BirGün: We are in the 10th year of the crisis that started from the USA. How do you summarise the consequences of the crisis after ten years?
John Bellamy Foster: The Great Financial Crisis (or Global Financial Crisis) that began in the United States in 2007 and then spread to the global economy after the collapse of Lehman Brothers in September 2008 was obviously a turning point for the capitalist world economy. The deepening of economic stagnation tendencies and the financialisation of the economy as a structural response to stagnation had been going on for decades in the United States and in the other advanced capitalist economies—as famously described by Harry Magdoff and Paul M. Sweezy in Stagnation and the Financial Explosion in the mid-1980s. But it was not until the 2008 crisis that the full dimensions and consequences of this were fully apparent. This is a problem that I addressed in two books, The Great Financial Crisis (2009), written with Fred Magdoff, and The Endless Crisis (2012), co-authored with Robert W. McChesney. The contradictions of accumulation under monopoly–finance capital that were described at that time—growing monopolisation, economic stagnation, and the financialisation of the world economy—have continued to develop over the last decade.
What has grown apace with all of these developments is the new economic imperialism of the global labor arbitrage, involving the location of an increasing share of the world’s industrial employment in the low-wage global South, and the siphoning off of the resulting economic surplus generated through the agency of multinational capital and international financial capital. What we are seeing is a huge amassing of wealth at the center of the system, the headquarters of world finance, which also controls the means of technological and military power, and the terms of trade, while the largest share of world industrial employment and proletarianisation has shifted to the periphery.
At present the US and the world economy are at the end of a long, sluggish recovery from the Great Financial Crisis. In the United States and elsewhere the economy is at the peak of the business cycle. But this comes at the end of a long, sluggish upturn. Growth rates at the center of the system have remained low, generally below the historical average, throughout the recovery. The US economy currently has a moderate growth rate of over 3 percent but in the European Union it is still below 2 percent. This points to the continuing sclerosis of capital formation. More and more, the capitalist entities in the center are dependent on their imperial financial positions, as centers for the concentration of wealth and power, even in the context of stagnant domestic production and accumulation. Global inequality has thus reached record levels, with a handful of individuals—no more than you could count on the fingers of your two hands, and perhaps fewer—now owning as much wealth as half the world’s population.
Global debt has risen like a mushroom cloud. According to the Institute of International Finance (IIF) in a report that came out this year, the global debt ratio has risen to $247 trillion, or 318 percent of global GDP. Boosted by the low interest rates following the Great Financial Crisis, world debt has risen 40 percent over the last decade.
All of this has the vested interests deeply concerned. Stock market jitters are now visible, and a full-scale panic is just below the surface. Right now, a downward turn in the business cycle is to be expected. Interest rates are again being eased upward in the United States, in a ghostly replay of 2006–07. The Federal Reserve is trying to initiate a controlled slowdown of the economy, throwing people out of work, in order to keep wages down and to lessen inflation worries—without inducing a financial meltdown in the process.
The IIF, meanwhile, has been raising concerns about emerging economies that are thought to be unable to roll over their debt. The IIF has singled out Turkey, South Africa, Brazil and Argentina as the emerging economies that have become bad risks. These countries, which only a few years ago were being celebrated by international capital as newly emerging centers of global accumulation, are now to be subjected to a new shock doctrine, in order to ensure the continuing flows of wealth to the global North. It is no accident, therefore, that each of these countries is now experiencing major political–economic instability.
One of the major developments in the aftermath of the crisis is the radical right-wing movements, which are represented by Trump in the US, while also developing in different forms in countries from Europe to Asia to Latin America. You oppose the designation of these as populist movements and state that they should be considered as neo-fascist. What is the difference between populism and neo-fascism?
The theoretical critique of classical fascism was developed mainly by Marxist theorists. Figures as varied as Leon Trotsky and Franz Neumann, the author of Behemoth, agreed that fascism had its roots in an alliance between the lower-middle class (or petty bourgeoisie) and monopoly capital, under conditions of hegemonic struggle between capitalist states, and growing militarism and racism. It is the nature of this class alliance between the lower-middle class and the upper echelons of concentrated capital that mainly distinguishes fascism, plus its profound enmity to the liberal–democratic state. It arises historically at a time in which the left has suffered major defeats, but when there is also a kind of political stalemate and the right cannot further its ends within the current structure. The enemies of classical fascism are not only the bulk of the working class but also the upper middle class, particularly the more highly educated portion of the population and governmental elites. Fascism invariably employs nationalist–racist ideology and severe repression against its class enemies, and singles out various scapegoats. It relies on what the Nazis called a totalitarian-state model (not to be confused with Cold War notion of totalitarianism), by which they meant the concentration of power within the state and ultimately the fascist leader (the Führer principle), eliminating the separation of powers. As Paul Sweezy said, the antonym of fascism is not socialism, but bourgeois democracy. In Germany especially, this was coupled with the privatisation of the economy (the term privatisation was introduced by the Nazis in the 1930s in the context of their selling off of state property to big business).
Fascism also typically depended on the growth of militant fascist movements (black shirts and brown shirts) that were incorporated into the state as a kind of paramilitary force. Once in power, fascist movements seek to transform the main institutions of the state and civil society by a process of Gleichschaltung (bringing into line)—a line of attack more easily carried out because it is backed by the capitalist class, because it takes place within existing institutional structures, and because it relies of what the Nazi theorist Carl Schmitt called the “extermination of heterogeneity,” which privileges some even as it terrorises others. Fascism in power seeks to curb any residual “radicalism” among its lower-middle class adherents while still mobilising them on nationalistic–racist lines. All of this seems to be forgotten, even on the left, and decades of liberal watering down of the notion of fascism have reduced the notion to one of right-wing racism, thereby disguising the structural reality, and the full extent of the danger, which cannot be seen simply in idealist or ideological terms. All of this and more is explained in my book Trump in the White House.
Although there is no complete replication of classical fascism in our time, the Trump phenomenon in the United States is best understood as a species of the fascist genus. The core of Trump’s support lies in the lower-middle class (petty bourgeoisie) in the United States, consisting largely of individuals who are white and either self-employed or high-level corporate workers and lower managers, often with strong nationalist and religious identifications. Trump lost when it came to the voters with less than the median level of income, vast numbers of whom, however, did not vote. His ideology and political practice rely on a combination of nationalism, racism and chauvinism that appeals to the lower-middle class—what C. Wright Mills called the “rear guard” of the capitalist system. Neo-fascism in this sense is a powerful political current, and once awakened won’t easily go away. In the United States it is closely correlated with widespread fears of the decline of US hegemony. Many of those within this social orbit believe that there has been a “betrayal” of the country by liberals, government employees, people of color, immigrants and women, and that this somehow accounts for the economic plight of “middle America.”
The term “populism,” as promoted today by the corporate media, is mostly a distraction, aimed at preventing class analysis and avoiding crucial questions about the class structure of society. It is heavily employed by the liberal media to indicate mass political developments aimed at vague “elites” in which neither the forces at the top or the bottom of society are clearly defined. In the populist rhetoric as used by the establishment populism, whether of left or the right, fascism is seen as constituting a threat to the so-called liberal center.
We are now seeing the spread of semi-fascist movements (not simply authoritarianism) in so-called emerging countries. The best analysis of this global development is still Samir Amin’s “The Return of Fascism to Contemporary Capitalism” in the September 2014 issue of Monthly Review where he points to the growth of fascist tendencies in the global South as well as Europe. Modi in India, Duterte in the Philippines, and Bolsonaro now in Brazil are prime examples. As Bernard D’Mello has recently argued in his India After Naxalbari, the repressive Hindutva nationalist movement in India is a manifestation of the development of “semi-fascism”—though occurring in a country in which there are still considerable radical opposition forces on the ground.
Turkey is also a developing country and is now facing a crisis, like Argentina. Both are being forced to go to the IMF. How do you assess the crisis in Argentina and the crisis in Turkey?
Both Turkey and Argentina are experiencing severe external debt problems that are also threatening their currencies, and generating political–economic instability. They are viewed by global capital as representing “roll-over risks.” High external short-term borrowing by these countries over the previous decade, in which international capital played the role of drug pushers, has now placed these countries in a near-default situation given the rise in interest rates introduced by the United States. The symptoms of this economic malaise are a slowdown in their growth, increasing current-account deficits, out-of-control inflation, weakening currencies, and emerging trade wars.
Both Argentina and Turkey have made some tentative efforts to hold down interest rates, but international finance has responded by backing away from their currencies. Nearly all of the major so-called emerging economies (excepting China and economies within its economic sphere of influence and Russia with its oil) are now reeling in the face of these new international pressures. The IMF’s answer is that that these states need to make their populations pay the cost of repaying loans by cutting state spending, social services, electricity subsidies—slashing anything geared to the needs of the population.
Turkey is in a somewhat different position than other emerging economies, in that the bulk of the external debt is held by Turkish companies and financial institutions, not the government. Over half of its $220 billion in foreign debt is denominated in foreign currencies, which means when the Turkish lira drops the Turkish companies see their debt explode.
One of the developments that need to be evaluated after the 2008 crisis was the wave of opposition, which was shaped by the square movements. This wave of opposition, however, lacked the ability to produce lasting results. At some points, it came to power as in the Syriza experience, in other places it has continued as a horizontal social movement. However, none of these political movements have yet become a center that will change the direction of the process. How do you evaluate the experiences of these movements?
Such movements are the material proof of peoples’ desire to fight back. At the same time, they represent the organisational, strategic, and ideological weaknesses of the left following a series of massive defeats, associated with the dismantling of the Soviet-type economies and the betrayals of social democracy. In response to neoliberal austerity, which only became worse after 2008, amorphous, left–populist movements emerged in some countries that represented the anger and desires of the people. This was exemplified by the “squares movements.” But since such movements essentially avoided class-based organisation and anti-capitalist strategies, and promoted a vague, anti-elitist ideology, while trusting in a few politically indeterminate leaders as representatives of the entire movement, their successes when they came to power was practically nil, evaporating overnight. Some post-Marxists like Ernesto Laclau and Chantal Mouffe promoted such a left–populist view, the dangers of which were highlighted by Ellen Meiksins Wood in The Retreat from Class.
Capitalism is a system of power, it can’t be materially overcome much less deposed by a mere aggregation of individuals coming together in a square or through the simple exercise of a popular vote. There has to be a more developed left political organisation/strategy. Today it is a question of building a movement toward socialism that struggles for the diverse needs of the working class. The struggle is both horizontal, accommodating the diverse needs of the workers and building equality within, and vertical, confronting a hierarchical capitalist order.
Today, in the wave of opposition, there is a search for new directions from Sanders to Corbyn. Latin America offered one of the first experiences in this respect from Lula to Chávez. What do these experiences say about the progress of socialism in the 21st century?
All of these new developments remind us that class struggle is possible and the various chains that hold us can be broken, and yet they also point to the scale of the problem and the deep contradictions that must be faced. As Marx said, human beings make their history, but not under conditions entirely of their own choosing, but rather under conditions directly inherited from the past.
Sanders demonstrated that a direct appeal to the broad working class in the United States would have an effect. His successes have inspired a broader political movement that has already secured the nominations of a couple of Democratic Socialists on the Democratic ticket for the Congressional elections. But the Democratic Party remains a party of the ruling class, while the United States remains at the center of the imperialist world system. Sanders in his bid for the nomination avoided challenging US militarism and imperialism. This means that the Sanders movement is likely to be very limited from the start in terms of effecting real change.
In this regard, Corbyn as leader of the Labour Party in the UK couldn’t be more different. He has been a consistent opponent of imperialism throughout his political career and has not budged on this as party leader. His rise to leader of the Labour Party in Britain therefore represents a historic shift at the level of political ideology and practice.
Lula is certainly no socialist. Tragically, he is now in prison as a result of a right-wing political coup, with the almost certain electoral triumph a few days from now of the outright fascist Bolosonaro. This represents the long-term failure of the whole strategy of the Workers’ Party, which tried to accommodate itself to the imperialist system and put its trust in an enlightened capitalist class.
It is to Chávez of course that we owe the notion of a ‘Socialism for the Twenty-First Century’, and it is through the Bolivarian Revolution in Venezuela that we saw another way of waging revolution, which achieved a significant success in its early years in shifting power toward the people, and in its defiance of international capital, with the result that the revolution has endured despite Chávez’s death and the relentless pounding by the US-led imperial order. It is a model of revolution that has relied on the forging of a new constitution, coupled with Bolivarian circles, communal councils, communes, and other forms of popular political–community organisation, in an effort to institute people’s power or protagonism. (It has been less successful in the area of promoting socialist-oriented unions and the transformation of workplace relations.) What is astonishing and entirely admirable in this context is the degree of resistance of the Venezuelan people, who so far have fought a US-directed global counterrevolution at every step, and with the odds stacked against them. Nothing so clearly points to the authenticity of the Venezuelan revolutionary experience. I wrote an article addressing some of the political aspects of this, called “Chávez and the Communal State,” for the April 2015 issue of Monthly Review.
For the opposition movement, there is a distinction between the development of the party organisations on the one hand and the horizontal organisations (social movements, assembly type public organisations) on the other hand. How do you evaluate this debate? How can opposition movements move to more effective policy and organisation?
I don’t have any magic answer on this, since organisational forms must vary according to circumstances. Organisational initiatives in both horizontal and vertical directions (vertical because of the class struggle waged from below against a hierarchal and repressive system) is necessary. Political parties are essential in any movement toward socialism, but they are not the only possible form of organisation. Socialist parties cannot simply be electoral parties. Extraparliamentary struggle aimed at strengthening the power of the working-class, as well as all struggles of women, race and ethnic groups, LBGTQ, Earth-System defenders, and many others, are vital. All of these movements must be part of the class struggle or the class struggle is meaningless, devoid of real content. By the same token, social movements structurally divorced from the class struggle end up dividing rather than uniting the movement, even when pursuing crucial ends. There needs to be the constant building of the working-class movement on the community level. Class and community (which often means forging wider links between diverse communities) are a powerful combination, and lead to the forging of powerful alliances. Strong, grassroots-based union movements seeking to control the labor process and workplace are essential. Combatting imperialism is another, even bigger challenge. This has to be extended to defending oppressed populations generally wherever they are, including immigrants and refugees. The major revolutions of the twentieth and twenty-first centuries have arisen in the global South and these demand our utmost support. The creation of a New International for the twenty-first century is required. Above all we need the audacity to launch continual attacks on the laws of motion of capitalism, using all the ingenuity at our disposal, refusing to “play the game” and forging new strategic terrains outside those laws of motion.
Along with your investigations into the economic crisis, you are conducting in-depth studies on the destructiveness of the ecological crisis. How will humanity save itself from the ecological crisis at a point where the social and economic crisis is deepening.
We normally see economic crises and ecological crises as separate and requiring opposite solutions, freeing up or limiting the economy, respectively. Nevertheless, both have their source in different ways in the capital accumulation process. It should not surprise us that capitalism displays both internal contradictions and contradictions with its external environment, both of which are insuperable. The notion that economy and environment are completely divided off from each other is merely a product of the combined alienation of nature and labor that constitutes the capitalist system. What is certain is that the overwhelming character of the ecological crisis, which today knows no bounds, will eventually override all of this, and workers will find, much like in the early Industrial Revolution, that the main material conditions determining their lives are both economic and environmental—and indeed that the latter are more far-reaching. At that point—and we are already seeing some signs of this, particularly in the global South—an environmental working class will emerge, capable of recognising that our material problems have a common cause in the systems of capital accumulation, and that the solution requires the revolutionary reconstitution of society at large aimed at a world of substantive equality and ecological sustainability.
John Bellamy Foster, professor of sociology at the University of Oregon, is editor of Monthly Review, an independent socialist magazine published monthly in New York City.
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