I have set out why there has been that change, elsewhere. It is symptomatic of the fact that the ruling-class during the last century became entirely a class of owners of fictitious-capital. The state, as the state of the ruling-class, acts to protect their interests, and its ruling ideas are those of that class, even when those ideas are based on a delusion that falls apart as each day passes. As capital became increasingly imperialist capital (large-scale, socialised, state-monopoly capital), from the end of the 19th century, the ruling-class itself, in proportion, became a class of coupon-clippers.
As coupon-clippers, dependent on the interest on bonds, and dividends on shares, they continued to have a direct interest in the growth of the profits of the companies which paid out those revenues. The state acted accordingly to ensure the growth of those profits, and accumulation of industrial capital. The heyday of that came in the period after WWII. It actually began in the 1930's, as on the one hand, the 1929 financial crash ruined many of the speculators, and created the conditions for the dominance of an accumulation of industrial capital, of its reflection in a corporatist, progressive social-democratic ideology, and a significant extension of economic planning and regulation by the state. In the US, The New Deal, but, in Europe, Nazi Germany, Nordic Social Democracy, etc. As economies geared up for WWII, that process was accelerated, and it continued after the end of the war.
That heyday ended in the 1970's, for the reasons I have set out earlier, and elsewhere. The period since, then, in particular since the mid 1980's, is the first time when the nature of the ruling-class, as a class made up entirely of owners of fictitious-capital, increasingly divorced from the interests of industrial capital, and, indeed, as Marx describes, antagonistic to it, has asserted itself. Initially, the defeat of the working-class, resulting from the technological revolution of the 1970's/80's, which resolved the crisis of overproduction of capital, and created a huge relative surplus population, and a massive rise in the general rate of profit, caused a fall in interest rates. The supply of additional money-capital from these higher profits, rose significantly. At the same time, the technological revolution, created a huge moral depreciation of the fixed capital stock, and the rise in productivity, also cheapened materials and energy, as well as labour-power. In other words, it created a huge release of capital.
By the time the 80's became the 90's, asset prices had risen significantly. House prices in Britain had quadrupled, and similar rises occurred across the globe. In addition, money that did not find a home in real capital accumulation, found its way into other forms of speculation. In the US, the Dow Jones and S&P 500 rose by around 230%, between 1980 and 1990, whilst US GDP rose, just 108%. In 1987, a global financial crash set the scene for the following 40 years. It is the first time that the consequence of the ruling-class having become a class of owners of fictitious-capital becomes apparent.
The period of social-democracy, in its ascendancy, had been one in which real industrial capital accumulated, profits rose and out of those profits, were paid increasing amounts of interest, rent and taxes. The fact that demand continually expanded during this period, meant that every industrial capital was forced to seek to grab its share of the market, by increasing its output/accumulating capital – the intensive accumulation of the 1930's/40's, turned into the extensive accumulation of the 1960's/70's. The owners of fictitious capital, were subordinated to the needs of capital accumulation, but content in conditions where the mass of their revenues, in the form of interest/dividends and rent, continued to rise, even if, as a proportion of profits, they declined. When that period culminated in a crisis of overproduction of capital, in the 1970's, there were only two options. Either the constraints of capital itself had to be smashed, or else the working-class would be smashed.
The first required that the working-class had a fully conscious political leadership that understood the real basis of struggle. No such leadership existed. Instead, one of two strategies pervaded the labour movement. The most significant of those strategies was that which simply saw the period ahead as being a more intense continuation of the period that was, now, gone. In other words, it was a strategy based on a bourgeois, trades union consciousness of bargaining within the system for a bigger slice for labour. That had worked since the 1950's, as capital expanded, profits were high, and as the period progressed, labour became increasingly in relative short supply. It was precisely the success of workers in that period – more to do with the expansion of capital than effective trades union militancy – that brought about its demise, for the reasons I have set out, and that Marx describes in Wage-Labour and Capital, and Value, Price and Profit. It was an impossible strategy, at the point that capital had already responded to the overproduction of capital/shortage of labour, by revolutionising technology, and creating a relative surplus of labour!
That strategy was one pursued by the Stalinists in the Communist Party, and their fellow travellers in the Labour Left. In conditions where the historic dominance of those forces was being effectively challenged by the likes of the SWP and Militant, they, also, pursued that strategy. In the case of the Communist Party, Bennite Left, and Militant, the extension of this strategy took the form of a process in which mounting industrial struggle would lead to increased pressure on the Labour Party, via its Left-wing, to, in some form, “take the power”, meaning, in reality, that a Labour government would respond to opposition from bosses, by supporting trades unions, nationalising companies that were closing down, and by continuing the process began in the 1970's, of increased planning and regulation of production. In short, to become a Workers' Government. Unfortunately, not only was such a strategy, at this point, doomed, but, it was also, thoroughly confused and nationalistic, including elements that were inherently racist. It was a modern version of the Moseley Memorandum, put forward by Oswald Mosely, when he was a Minister in the Labour Government, and which became the basis of the economic strategy he adopted for the New Party, and the British Union of Fascists.
So, elements of this Alternative Economic Strategy, called for import controls, which, of their nature, as with Trump's tariffs, not only lead workers to the conclusion that the source of their problems is not capitalism, but “foreigners”, who are, in some way, doing them down, by producing goods more cheaply, and exporting them to Britain, it also means that, as domestic prices rise, the consequence is either falling real wages, or, to the extent real wages are protected, falling domestic profits, and so less new money-capital available for capital accumulation, causing higher interest rates, a tie-up of capital, slower growth etc. That at a time when the solution for workers across Europe, and indeed across the globe, was to unite, across national borders, against their common enemy capital. Indeed some elements of that strategy not only called for import controls, but also immigration controls, immediately and visibly blaming foreign workers for the problems of British workers.
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