Capitalism Has Failed—What Next?

Less than two decades into the twenty-first century, it is evident that capitalism has failed as a social system. The world is mired in economic stagnation, financialisation, and the most extreme inequality in human history, accompanied by mass unemployment and underemployment, precariousness, poverty, hunger, wasted output and lives, and what at this point can only be called a planetary ecological “death spiral.” The digital revolution, the greatest technological advance of our time, has rapidly mutated from a promise of free communication and liberated production into new means of surveillance, control, and displacement of the working population. The institutions of liberal democracy are at the point of collapse, while fascism, the rear guard of the capitalist system, is again on the march, along with patriarchy, racism, imperialism and war.


To say that capitalism is a failed system is not, of course, to suggest that its breakdown and disintegration is imminent. It does, however, mean that it has passed from being a historically necessary and creative system at its inception to being a historically unnecessary and destructive one in the present century. Today, more than ever, the world is faced with the epochal choice between “the revolutionary reconstitution of society at large and the common ruin of the contending classes.”


Indications of this failure of capitalism are everywhere. Stagnation of investment punctuated by bubbles of financial expansion, which then inevitably burst, now characterises the so-called free market. Soaring inequality in income and wealth has its counterpart in the declining material circumstances of a majority of the population. Real wages for most workers in the United States have barely budged in forty years despite steadily rising productivity. Work intensity has increased, while work and safety protections on the job have been systematically jettisoned. Unemployment data has become more and more meaningless due to a new institutionalised underemployment in the form of contract labor in the gig economy. Unions have been reduced to mere shadows of their former glory as capitalism has asserted totalitarian control over workplaces.


The capture of the surplus value produced by overexploited populations in the poorest regions of the world, via the global labour arbitrage instituted by multinational corporations, is leading to an unprecedented amassing of financial wealth at the center of the world economy and relative poverty in the periphery. Around $21 trillion of offshore funds are currently lodged in tax havens on islands mostly in the Caribbean, constituting “the fortified refuge of Big Finance.” Technologically driven monopolies resulting from the global communications revolution, together with the rise to dominance of Wall Street-based financial capital geared to speculative asset creation, have further contributed to the riches of today’s “1 percent.” Forty-two billionaires now enjoy as much wealth as half the world’s population, while the three richest men in the United States—Jeff Bezos, Bill Gates, and Warren Buffett—have more wealth than half the US population. In every region of the world, inequality has increased sharply in recent decades. The gap in per capita income and wealth between the richest and poorest nations, which has been the dominant trend for centuries, is rapidly widening once again. More than 60 percent of the world’s employed population, some two billion people, now work in the impoverished informal sector, forming a massive global proletariat. The global reserve army of labor is some 70 percent larger than the active labour army of formally employed workers.


Adequate health care, housing, education, and clean water and air are increasingly out of reach for large sections of the population, even in wealthy countries in North America and Europe, while transportation is becoming more difficult in the United States and many other countries due to irrationally high levels of dependency on the automobile and disinvestment in public transportation. Urban structures are more and more characterised by gentrification and segregation, with cities becoming the playthings of the well-to-do while marginalised populations are shunted aside. About half a million people, most of them children, are homeless on any given night in the United States. New York City is experiencing a major rat infestation, attributed to warming temperatures, mirroring trends around the world.


In the United States and other high-income countries, life expectancy is in decline, with a remarkable resurgence of Victorian illnesses related to poverty and exploitation. In Britain, gout, scarlet fever, whooping cough, and even scurvy are now resurgent, along with tuberculosis. With inadequate enforcement of work health and safety regulations, black lung disease has returned with a vengeance in US coal country. Overuse of antibiotics, particularly by capitalist agribusiness, is leading to an antibiotic-resistance crisis, with the dangerous growth of superbugs generating increasing numbers of deaths, which by mid–century could surpass annual cancer deaths, prompting the World Health Organisation to declare a “global health emergency.”


More than two million people in the United States are behind bars, a higher rate of incarceration than any other country in the world, constituting a new Jim Crow. African Americans and Latinos make up 56 percent of those incarcerated, while constituting only about 32 percent of the US population. Nearly 50 percent of American adults, and a much higher percentage among African Americans and Native Americans, have an immediate family member who has spent or is currently spending time behind bars. Racial divides are now widening across the entire planet.


Violence against women and the expropriation of their unpaid labor, as well as the higher level of exploitation of their paid labor, are integral to the way in which power is organised in capitalist society—and how it seeks to divide rather than unify the population. More than a third of women worldwide have experienced physical/sexual violence. Women’s bodies, in particular, are objectified, reified, and commodified as part of the normal workings of monopoly-capitalist marketing.


The mass media–propaganda system, part of the larger corporate matrix, is now merging into a social media-based propaganda system that is more porous and seemingly anarchic, but more universal and more than ever favouring money and power. Utilising modern marketing and surveillance techniques, which now dominate all digital interactions, vested interests are able to tailor their messages, largely unchecked, to individuals and their social networks, creating concerns about “fake news” on all sides. Numerous business entities promising technological manipulation of voters in countries across the world have now surfaced, auctioning off their services to the highest bidders. The elimination of net neutrality in the United States means further concentration, centralisation, and control over the entire Internet by monopolistic service providers.


Elections are increasingly prey to unregulated “dark money” emanating from the coffers of corporations and the billionaire class. Although presenting itself as the world’s leading democracy, the United States, as Paul Baran and Paul Sweezy stated in Monopoly Capital in 1966, “is democratic in form and plutocratic in content.” In the Trump administration, following a long-established tradition, 72 percent of those appointed to the cabinet have come from the higher corporate echelons, while others have been drawn from the military.


War, engineered by the United States and other major powers at the apex of the system, has become perpetual in strategic oil regions such as the Middle East, and threatens to escalate into a global thermonuclear exchange. During the Obama administration, the United States was engaged in wars/bombings in seven different countries—Afghanistan, Iraq, Syria, Libya, Yemen, Somalia and Pakistan. Torture and assassinations have been reinstituted by Washington as acceptable instruments of war against those now innumerable individuals, group networks, and whole societies that are branded as terrorist. A new Cold War and nuclear arms race is in the making between the United States and Russia, while Washington is seeking to place road blocks to the continued rise of China. The Trump administration has created a new space force as a separate branch of the military in an attempt to ensure US dominance in the militarisation of space.


Increasingly severe economic sanctions are being imposed by the United States on countries like Venezuela and Nicaragua, despite their democratic elections—or because of them. Trade and currency wars are being actively promoted by core states, while racist barriers against immigration continue to be erected in Europe and the United States as some 60 million refugees and internally displaced peoples flee devastated environments. Migrant populations worldwide have risen to 250 million, with those residing in high-income countries constituting more than 14 percent of the populations of those countries, up from less than 10 percent in 2000. Meanwhile, ruling circles and wealthy countries seek to wall off islands of power and privilege from the mass of humanity, who are to be left to their fate.


More than three-quarters of a billion people, over 10 percent of the world population, are chronically malnourished. Food stress in the United States keeps climbing, leading to the rapid growth of cheap dollar stores selling poor quality and toxic food. Around forty million Americans, representing one out of eight households, including nearly thirteen million children, are food insecure. Subsistence farmers are being pushed off their lands by agribusiness, private capital, and sovereign wealth funds in a global depeasantisation process that constitutes the greatest movement of people in history. Urban overcrowding and poverty across much of the globe is so severe that one can now reasonably refer to a “planet of slums.” Meanwhile, the world housing market is estimated to be worth up to $163 trillion (as compared to the value of gold mined over all recorded history, estimated at $7.5 trillion).


The Anthropocene epoch, first ushered in by the Great Acceleration of the world economy immediately after the Second World War, has generated enormous rifts in planetary boundaries, extending from climate change to ocean acidification, to the sixth extinction, to disruption of the global nitrogen and phosphorus cycles, to the loss of freshwater, to the disappearance of forests, to widespread toxic-chemical and radioactive pollution. It is now estimated that 60 percent of the world’s wildlife vertebrate population (including mammals, reptiles, amphibians, birds, and fish) have been wiped out since 1970, while the worldwide abundance of invertebrates has declined by 45 percent in recent decades.


If present climate-change trends continue, the “global carbon budget” associated with a 2°C increase in average global temperature will be broken in sixteen years (while a 1.5°C increase in global average temperature—staying beneath which is the key to long-term stabilisation of the climate—will be reached in a decade). Earth System scientists warn that the world is now perilously close to a Hothouse Earth, in which catastrophic climate change will be locked in and irreversible. The ecological, social, and economic costs to humanity of continuing to increase carbon emissions by 2.0 percent a year as in recent decades (rising in 2018 by 2.7 percent—3.4 percent in the United States), and failing to meet the minimal 3.0 percent annual reductions in emissions currently needed to avoid a catastrophic destabilisation of the earth’s energy balance, are simply incalculable.


Nevertheless, major energy corporations continue to lie about climate change, promoting and bankrolling climate denialism—while admitting the truth in their internal documents. These corporations are working to accelerate the extraction and production of fossil fuels, including the dirtiest, most greenhouse gas-generating varieties, reaping enormous profits in the process. Capitalist countries across the board are putting the accumulation of wealth for a few above combating climate destabilisation, threatening the very future of humanity.


Capitalism is best understood as a competitive class-based mode of production and exchange geared to the accumulation of capital through the exploitation of workers’ labour power and the private appropriation of surplus value (value generated beyond the costs of the workers’ own reproduction). The mode of economic accounting intrinsic to capitalism designates as a value-generating good or service anything that passes through the market and therefore produces income. It follows that the greater part of the social and environmental costs of production outside the market are excluded in this form of valuation and are treated as mere negative “externalities,” unrelated to the capitalist economy itself—whether in terms of the shortening and degradation of human life or the destruction of the natural environment.


We have now reached a point in the twenty-first century in which the externalities of this irrational system, such as the costs of war, the depletion of natural resources, the waste of human lives, and the disruption of the planetary environment, now far exceed any future economic benefits that capitalism offers to society as a whole. The accumulation of capital and the amassing of wealth are increasingly occurring at the expense of an irrevocable rift in the social and environmental conditions governing human life on earth.


How did these disastrous conditions characterising capitalism worldwide develop? An understanding of the failure of capitalism, beginning in the twentieth century, requires a historical examination of the rise of neoliberalism, and how this has only served to increase the destructiveness of the system. Only then can we address the future of humanity in the twenty-first century.


Neoliberalism and Capitalist Failure


Many of the symptoms of the failure of capitalism described above are well-known. Nevertheless, they are often attributed not to capitalism as a system, but simply to neoliberalism, viewed as a particular paradigm of capitalist development that can be replaced by another, better one. For many people on the left, the answer to neoliberalism or disaster capitalism is a return to welfare-state liberalism, market regulation, or some form of limited social democracy, and thus to a more rational capitalism. It is not the failure of capitalism itself that is perceived as the problem, but rather the failure of neoliberal capitalism.


In contrast, the socialist tradition understands neoliberalism as an inherent outgrowth of late capitalism, associated with the domination of monopoly-finance capital. A critical-historical analysis of neoliberalism is therefore crucial both to grounding our understanding of capitalism today and uncovering the reason why all alternatives to neoliberalism and its capitalist absolutism are closed within the system itself.


The term neoliberalism had its origin in the early 1920s, in the socialist critique of the Austrian economist Ludwig von Mises’s (1881–1973) Nation, State, and Economy (1919) and Socialism: An Economic and Sociological Analysis (1922), both of which were written as virulent anti-socialist tracts. In these works, Mises, then employed by the Vienna Chamber of Commerce, equated socialism with “destructionism,” insisted that monopoly was consistent with capitalist free competition, defended unlimited inequality, and argued that consumers exercised “democracy” through their purchases, which were equivalent to ballots. He strongly condemned labour legislation, compulsory social insurance (or social security – provides protection against various economic risks, such as loss of income due to illness, retirement benefits, or unemployment), trade unions, unemployment insurance, nationalisation, taxation, and inflation as the enemies of his refurbished liberalism.


In 1921, renowned Austrian socialist philosopher and politician Max Adler coined the term neoliberalism to designate Mises’s attempt to refurbish a fading liberal order through a new ideology of market fetishism. Subsequently, Mises’ neoliberalism was criticised by several other socialists.


The 1930s, and later the post-Second World War years in the West are known as the age of Keynes. The Great Depression years saw powerful working class movements, forcing the ruling classes to implement measures such as the New Deal. And then, after the Second World War, capitalist economies grew rapidly for a quarter-century—spurred on by increased state spending (particularly on the military in the context of the Cold War), the rebuilding of the war-torn European and Japanese economies, the expansion of the sales effort, waves of automobilisation in both the United States and Europe, and two major regional wars in Asia. Simultaneously, the West was faced with the threat of the alternative model represented by the Soviet Union, and the advent of strong unions as a result of the developments of the 1930s and ’40s. Consequently, the West moved in the direction of Keynesianism, social democracy, and the welfare state. The net result was: from the 1930s to 1960s, following the Great Depression and the Second World War, neoliberal ideology waned in the context of the deepening crisis of capitalism.


Nevertheless, the tendency toward economic stagnation already exhibited in the 1930s remained as a structural flaw of the system, temporarily masked by the so-called Golden Age of rapid growth and increasing income for workers that immediately followed the Second World War. By the 1960s, the factors that led to the rapid growth of the economy in the 1950s began to wane, and the US economy began to slowdown once again, resulting in a structural crisis of the capitalist system in the mid–1970s. This marked the beginning of decades of economic stagnation and a long decline in the trend rate of growth in the advanced capitalist economies.


To maintain its profit accumulation, the capitalist class now sought to reverse decades of modest working-class gains, thereby deciding to take an anti-Keynesian stance, designating  anything to the left of hardcore neoliberalism as socialist or totalitarian. There was a sharp turn toward austerity and economic restructuring, under the guise of monetarism and supply-side economics. Simultaneously, a concerted effort to destroy unions by combined political, economic, and juridical means was carried out.


Key to the reemergence of neoliberalism in the post-Second World period was the Mont Pèlerin Society, named after the Swiss spa where Mises, Hayek, Robbins, Milton Friedman, George Stigler, Raymond Aron, and others met in 1947, to promote neoliberal economic and political ideas. However, the members of the Mont Pèlerin Society did not refer to themselves as neoliberals, probably because they remembered the devastating socialist critiques of neoliberal ideology in the 1920s, and referred to themselves as classical liberals; they stated that neoliberalism was not a separate political ideology but only an extension of classical liberalism and attributable to inherent features of human nature. In this way, as Michel Foucault (French philosopher) argued, it was converted into a kind of biopolitics.


Till the 1960s, figures like Mises, Hayek, Friedman, and James Buchanan remained on the margins, though heavily bankrolled by private foundations. But with the return of economic stagnation in the 1970s, neoliberal intellectuals were actively recruited at the apex of monopoly capital in order to provide the ideological basis to launch the corporate campaign to restructure the capitalist economy, deliberately targeting labour, the state, and the underdeveloped economies of the global South. By now, along with the Mont Pèlerin Society, the Department of Economics at the University of Chicago too had become the bastion of neoliberal ideology, as several leading believers in this ideology were teaching there.


Central to neoliberal philosophy from the beginning was the defense of concentrated corporate capital and class dynasties, which were portrayed as representing free-market competition and entrepreneurship. The very virulence of neoliberal anti-socialism meant that it represented the drive to a complete market-privatisation of social life. In Margaret Thatcher’s London and Ronald Reagan’s Washington, figures like Hayek and Friedman became the symbols of the neoliberal era. The new so-called Nobel Prize in Economics, or the Sveriges Riksbank (Bank of Sweden) Prize in Economic Sciences in Memory of Alfred Nobel, established by the Bank of Sweden in 1969, was controlled from its inception by ultraconservative neoliberal economists. Seven members of the Mont Pèlerin Society, including Hayek, Friedman, Stigler, and Buchanan received the prize between 1974 and 1992, while even mildly social-democratic economists were all but excluded.


Neoliberalism as an economic ideology was largely ineffectual in normal economic-policy terms, judged by its lack of success in promoting growth. But for big business, it was a huge success as the surplus capital in the hands of the corporate rich not only increased, but by virtue of financialisation, globalisation, and the revolution in digital technology, new forms of amassing wealth were created.


Financialisation—the relative shift of the economy from production to finance—opened up vast new avenues to speculation and wealth formation, relatively removed from capital investment in new productive capacity (that is, real capital accumulation). Globalisation meant not only new markets, but, more importantly—through the global labour arbitrage—the appropriation of huge economic surpluses from the overexploitation of low-wage labor in the periphery that ended up in the financial coffers of multinational corporations and wealthy individuals in the rich countries.


Meanwhile, digital technology created the basis of a new globalised surveillance capitalism, buying and selling information on the population, primarily motivated by the sales effort, leading to the creation of enormous information-technology monopolies.


Vast increases in inequality and wealth were justified as returns for innovation. In the new era of expropriation, all was up for grabs: education, health systems, transportation, housing, land, cities, prisons, insurance, pensions, food, entertainment. All exchanges in society were to be fully commodified, corporatised, and financialised, with the funds flowing into financial centers and feeding speculation on capital gains, leveraged by debt. Human communication was itself to be turned into a commodity. All in the name of a free-market society.


For the powers that be, this strategy was enormously successful. The financialisation process managed to counter economic-stagnation tendencies to some extent, but at the cost of periodic financial crises layered over the normal business cycle. Nevertheless, the amassing of wealth at the top continued to accelerate, with financial crises themselves leading to even greater financial concentration and centralisation.


The state too became subject to the financialisation policy, shifting its overall role to protecting the value of money. In the Great Financial Crisis of 2007–09, the big banks and corporations were almost all bailed out; the population was not. While this crisis, the worst faced by the capitalist world since the Great Depression of 1929–37, should have raised questions about the efficacy of neoliberalism, what has actually happened is its exact opposite—the neoliberal ideology has become so strongly entrenched that the Great Financial Crisis only gave it further impetus!


A characteristic of this new era of financialised accumulation is that it is so far removed from the realities of production and use value that it has led to “a social and ecological planetary emergency.” This is most evident in the rapid destruction of the natural environment. Fossil fuels are entered as financial assets on the books of corporations, even when they exist only in the form of reserves buried in the ground. Trillions of dollars of Wall Street assets are thus tied up in fossil capital. This has made it doubly difficult to shift away from the extraction and use of fossil fuels to more sustainable alternatives, such as solar and wind power. No one owns the sun’s rays or the wind. Hence, there is less of a vested interest in these forms of energy. In today’s capitalism, more than ever before, current and potential future profits dictate all, at the expense of people and the planet. The human population stands by, seemingly helpless, watching the destruction of the climate and the loss of innumerable species, all imposed by the ostensibly overwhelming force of market society.


Neoliberalism has always been directly opposed to strict laissez faire since it has invariably emphasised a strong, interventionist, and constructionist relation to the state, in the direct service of private capital and market authoritarianism. In the neoliberal view, the role of the state is not simply to protect property, as maintained by Smith, but extends to the active construction of the domination of the market over all aspects of life. This means refashioning the state and society on the model of the corporation or the market.


The state must not “correct the destructive effects of the market,” where these fall “on society” outside the market, but rather take advantage of these destructive effects to impose further measures that extend the reach and penetration of the market. The goal is to shackle the state to the monopolistic–competitive ends of capital, so as to limit any changes that would negatively affect the value of money. Hence, both fiscal and monetary policy are increasingly put out of reach of the government itself—in those cases where changes going against the vested interests are contemplated. Central banks have been transformed into largely autonomous branches of the state, in fact controlled by the banks. Treasury departments are shackled by debt ceilings. Regulatory agencies are captured by monopoly–finance capital and act, for the most part, in the direct interest of corporations outside governmental control.


Such an attempt to construct a so-called self-regulating market society therefore requires constant state interventions on behalf of capital, undermining the very foundations of society and life itself. Neoliberalism thus extends the structural crisis of capitalism in its globalised monopoly–finance phase to all of society and makes it universal. The answer to every failing of capitalism is thus to turn the screw further—with each failure opening up new areas of profitability for a few. The result of this irrational logic is not merely economic and ecological disaster, but the gradual demise of the liberal–democratic state itself. Neoliberalism thus points inevitably to market authoritarianism and even neofascism. In this respect, Donald Trump is no mere aberration.


As Mises openly declared in 1927 in another work, Liberalism: “It cannot be denied that Fascism and similar movements [on the right] aiming at the establishment of dictatorships are full of the best intentions, and that their intervention, has, for the moment, saved European civilisation. The merit that Fascism has thereby won for itself will live on eternally in history.” Hayek, along with other neoliberals such as Friedman and Buchanan, actively supported General Augusto Pinochet’s coup in Chile in 1973, overthrowing the democratically elected socialist government of Salvador Allende and imposing an economic shock doctrine on the population. Hayek, during a trip to Chile in 1978, personally warned Pinochet against a resurrection of “unlimited democracy.” During a second visit in 1981, he stated that “a dictatorship . . . may be more liberal in its policies than a democratic assembly.”


Neoliberalism, in short, is not a mere paradigm that can be dispensed with, but represents the absolutist tendencies of the system in the age of monopoly finance. In this new phase of monopoly capitalism, its survival can only be ensured for a time by the singular application of its economic logic to all of sociological existence. Reduced, however, to a pure Midas principle, capitalism is ending up by destroying everything in existence with which it comes into contact. But if capitalism has now failed, the question becomes: What next?


What Next?


In his magisterial The Age of Extremes: A History of the World 1914–1991, the renowned socialist historian Eric Hobsbawm, viewing the approach of the twenty-first century, indicated that there were reasons to be concerned that the new century might be even more threatening to humanity than the “age of extremes” that had preceded it, a century that had been punctuated by world wars, imperial conflicts, and economic depressions—and in which humanity was confronted for the first time with the possibility of its own self-annihilation. Yet, looking forward, he concluded, the new century (and millennium) offered even greater dangers.


“We live in a world,” Hobsbawm observed in 1994,


uprooted and transformed by the titanic economic and the techno-scientific process of the development of capitalism . . . it cannot go on ad infinitum. The future cannot be a continuation of the past, and there are signs, both externally, and, as it were, internally, that we have reached a point of historic crisis. The forces generated by the techno-scientific economy are now great enough to destroy the environment, that is to say, the material foundations of human life. The structures of human societies themselves, including even some of the social foundations of the capitalist economy, are on the point of being destroyed by the erosion of what we have inherited from the human past. Our world risks both explosion and implosion. It must change. . . . If humanity is to have a recognisable future, it cannot be by prolonging the past or the present. If we try to build the third millennium on that basis, we shall fail. And the price of failure, that is to say, the alternative to a changed society, is darkness.


Hobsbawm left little doubt as to what the principal danger was at present, namely “the theological faith in an economy in which resources were allocated entirely by the totally unrestricted market, under conditions of unlimited competition,” carried out by ever more concentrated corporations. Chief among the dangers of such a system was the likelihood of “irreversible and catastrophic consequences for the natural environment of this planet, including the human race which is part of it.”


Hobsbawm’s position was roundly criticised at the time, even by many on the left, as overly “pessimistic” with regard to the course of capitalist development. Today, however, a quarter-century later, it is clear that he hit the mark, as the concerns that he voiced then are even more evident today. Nevertheless, there are still progressive intellectuals in the wealthy countries who hope that the pendulum will swing back again, leading to a more affirmative-style liberalism or social democracy. This sustains the belief that the failures of unregulated capitalism can be countered by a return to regulated capitalism, a new Keynesian age—as if history had stood still.


This, however, denies the material reality that neoliberalism today is ingrained in capitalism itself, in the phase of monopoly–financial capital. The earlier age of industrial–capital dominance, on which Keynesian economics was based, is now gone. Even if progressive or socialist or left parties come to power in these circumstances, and attempt to implement Keynesianism, they will invariably fall prey to the laws of motion of capitalism in this phase.


So, the question arises, what next? Of course, the actual course of history can never be predicted. The only thing certain about historical change is the existence of the struggles that drive it forward and that guarantee its discontinuous character. Both implosions and explosions inevitably materialise, rendering the world for new generations different than that of the old. History points to numerous social systems that have reached the limits of their ability to adapt their social relations to allow for the rational and sustainable use of developing productive forces. Hence, the human past is dotted by periods of regression, followed by revolutionary accelerations that sweep all before them.


Could such a revolutionary acceleration of history, though on an incomparably greater scale, happen in the twenty-first century?


As a direct result of capitalist social relations, the material challenges now facing humanity are greater than anything ever seen before, pointing to an accumulation of catastrophe along with the accumulation of capital. Hundreds of millions of people under these circumstances are already being drawn into struggles with the system, creating the basis of a new worldwide movement toward socialism. Yes, the working people can indeed change the world, but they can only do so through a unifying struggle by workers and peoples aimed at genuine socialism.


It may be objected that socialism has been tried and has failed and hence no longer exists as an alternative. However, like the earliest attempts at capitalism in the Italian city-states of the late Middle Ages, which were not strong enough to survive amongst the feudal societies that surrounded them, the failure of the first experiments at socialism presage nothing but its eventual rebirth in a new, more revolutionary, more universal form, which examines and learns from the failures. Even in failure, socialism has this advantage over capitalism: it is motivated by the demand for “freedom in general,” rooted in substantive equality and sustainable human development—reflecting precisely those collective social relations, borne of historical necessity and the unending struggle for human freedom, crucial to human survival in our time.


It is capitalism’s undermining of the very basis of human existence that will eventually compel the world’s workers and peoples to seek new roads forward. An inclusive movement toward socialism in this century will open up the possibility of qualitative new developments that the anarchy of the capitalist-market society with its monopolistic competition, extreme inequality, and institutionalised greed cannot possibly offer. It introduces the prospect of long-term democratic planning at all levels of society, allowing decisions to be made and distributions to occur outside the logic of the cash nexus. Socialism, in its most radical form, is about substantive equality, community solidarity, and ecological sustainability; it is aimed at the unification—not simply division—of labour.


Once sustainable human development, rooted not in exchange values, but in use values and genuine human needs, comes to define historical advance, the future, which now seems closed, will open up in a myriad ways, allowing for entirely new, more qualitative, and collective forms of development. This can be seen in the kinds of needed practical measures that could be taken up, but which are completely excluded under the present mode of production. It is not physical impossibility, or lack of economic surplus, that stands in the way of the satisfaction of basic needs—clean air and water, food, clothing, housing, education, health care, transportation, and useful work—for all. It is not the shortage of technological know-how or of material means that prevents the necessary ecological conversion to more sustainable forms of energy. All of this is within our reach, but requires pursuing a logic that runs counter to that of capitalism.


The very waste and excess of today’s monopoly–finance capitalism, together with the development of new means of communication that allow for greater human coordination, planning, and democratic action than ever before, suggest that there are countless paths forward to a world of substantive equality and ecological sustainability once the world is freed from the fetters of capital.


The mainsprings of human action throughout history lie in the drive for human freedom and the struggle to master our relation to the world. The first of these ultimately demands equality and community; the second, human development and sustainability. It is on these struggles for collective advancement that we must ultimately rely if humanity is to have a future at all.


(John Bellamy Foster is professor of sociology at the University of Oregon and editor of the American socialist magazine, Monthly Review.)

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