No 1701 Posted by fw, June 13, 2016
“Three years after the near collapse of global financial markets, America is still struggling with unemployment, debt, and foreclosure, European governments are teetering on the brink of bankruptcy—and the world’s billionaires are getting richer faster than ever before. The current situation is not sustainable. But what changes need to be made to overcome this mounting crisis of our world economic system? How radical an adaptation will be required? David Harvey, the brilliant theorist and scathing critic of postmodern society, looks at what the future holds for global capitalism.”
In an 85-minute tour de force video-recorded presentation before an academic audience, the erudite Dr. Harvey, speaking without any apparent aid of written notes, reflects on the end of capitalism. As he says in his witty opening:
“I’m not quite sure where the title of this talk came from. I’m not sure I gave it. Maybe I did. That was awhile ago and you know in one of those euphoric moments and I said, oh, oh you know… But it immediately tracks me back again to the middle the 1990s when I first heard the commentary that it’s easier to imagine the end of the world than it is to imagine the end of capitalism. And I heard it from Donna Haraway at that time and since then has been attributed to all kinds of people, so where it originated I have no idea. But I think it’s worth thinking about it. And I thought, you know, since it was easier to talk about the end of the world I’d skip this capitalism bit and talk about the end of the world, and you, then, feel much more reassured.”
I have watched Dr. Harvey’s presentation. I can promise you that you’re in for a ride. And by the end of his lecture, you will have a far greater understanding of why we’re in the mess we’re in. And why it will be so “hard to imagine the end of capitalism.”
David W. Harvey is the Distinguished Professor of anthropology and geography at the Graduate Center of the City University of New York (CUNY). He received his PhD in geography from the University of Cambridge. In 2007, Harvey was listed as the 18th most-cited author of books in the humanities and social sciences.
NOTE: I am in the process of writing a transcript for the entire lecture. (Although there is a scrolling auto-generated transcript accompanying the video, it is an error-filled disaster. But should you wish to access it, click on the “● ● ● More” link below the video. After a longish introduction of Professor Harvey, he begins his address about 8 minutes into the video. Part 1 of the transcript covers up to about the 21:19-minute mark.
The full 85-minute video is embedded below. My transcript of the 21:19-minutes of the Part 1 segment includes subheadings: before watching the video, you may find it helpful to skim the transcript subheadings to get a summary overview of the key ideas discussed by Dr. Harvey. To watch the video on the You Tube website, click on the following linked title.
“It’s easier to imagine the end of the world than it is to imagine the end of capitalism.”
So, thank you for that introduction. It was very interesting — you’re frustrated. I’ve been frustrating a lot of people. I recall back in the 1990s I was told that Marxism was dead, and I said, well actually I think I’m still alive. And since then I’ve been writing up a storm just to prove them wrong, and it’s been a rather great experience.
I’m not quite sure where the title of this talk came from. I’m not sure I gave it. Maybe I did. That was awhile ago and you know in one of those euphoric moments and I said, oh, oh you know…
But it immediately tracks me back again to the middle the 1990s when I first heard the commentary that it’s easier to imagine the end of the world than it is to imagine the end of capitalism. And I heard it from Donna Haraway at that time and since then has been attributed to all kinds of people, so where it originated I have no idea. But I think it’s worth thinking about it. And I thought, you know, since it was easier to talk about the end of the world I’d skip this capitalism bit and talk about the end of the world, and you, then, feel much more reassured.
Why is it so hard to imagine an alternative to capitalism?
But there’s something serious here which I did think I’d like to reflect upon and so when I saw the title I thought well maybe I should think about this: which is why is it so hard to imagine an alternative to capitalism? What is it that’s happened that puts us in a situation where it seems there is no alternative.
“There is no alternative.” – Margaret Thatcher coined the phrase, but what did she mean by it?
And when I say there is no alternative, of course, I’m thinking back to the woman who coined that phrase, which is Margaret Thatcher. And she said there is no alternative. And she set about trying to prove her point. And Thatcher, I think, is an extremely interesting figure now for precisely this reason that she said I’m not simply out to change the way the economy works, and, you know, crush the unions — well she didn’t say that — but what she was really saying was change the institutional arrangements. She said I’m, I’m really, I’m really out to change the soul. I’m, I’m really out to change the way in which people understand their relations to the world. And I am out to change the conceptual universe in which people live.
“There seems to be no alternative to the kind of capitalism we’ve got.”
And it’s very interesting to look right now – and this struck me very, very forcibly just recently when I was in Chile, where one of the other heroes of neoliberalization, General Pinochet, operated — where actually you realize that while Thatcher is no longer active in the scene and Pinochet is gone, Pinochet-ism, if you like, still rules in Chile, big-time. Thatcherism rules big-time. That actually this idea that there is no alternative has become so deeply embedded in our psyches, in our consciousness, that we cannot imagine that there is an alternative to capitalism. Another meme to there’s no alternative to capitalism, there seems to be no alternative to the kind of capitalism we’ve got.
During the 1990s, there was no great need to think about alternatives to capitalism
Now that point about there being, you know, being easier to imagine the end of the world, was said to me first in the 1990s when, you know, the need to think about alternatives was not so clearly apparent: the economy was booming and things seem to be going fine. Alan Greenspan was busy sort of Delphicly saying how the world was doing great. So, at that time the it was hard to imagine alternatives.
But after what we’ve been through since 2007, when there is a need to think of alternatives, why the bankruptcy of ideas?
But you would think, after we’ve been through what we’ve been through since 2007 or so, that the idea that there is no alternative would surely be sort of thrown to one side. But what I find instead is actually, at this particular historical moment there’s a tremendous bankruptcy of ideas as to what to do.
After the 1929 crash, there were alternative ideas: Keynesianism, state intervention, socialism, communism…
Back in the 1930s when there was a crisis there was at least an alternative theory lurking in the wings. Which was, you know, Keynes and Keynesianism and state involvement in the economy and, and okay there was a big battle and there were also social movements at that time, which genuinely envisaged some, some mass alternative. I mean that was the idea socialism, communism or those kinds of things were bubbling around. And so in the 1930s there was a clear sense that there’s an alternative. And as things went on there’s got to be an alternative.
Ultimately, World War 2 provided an alternative to the economic malaise – state intervention
And, you know, and ultimately after World War Two had kind of solved the economic problem, after World War Two an alternative emerged in which the state was heavily involved, in which taxation rates, for example, in this country were very high.
Proof that Republicans are wrong about high taxation rates destroying economic growth
I like to remind people we’re told by the Republicans that high taxation rates destroy growth. Taxation rate in top income brackets in this country in 1945 was 92 percent. Okay. It never fell below 70 percent until Ronald Reagan brought it down to 30. Between 1945 and Ronald Reagan the average [GDP] growth rate in the United States, particularly before the crisis the 1970s, is around four or five percent per year. In other words, this is one the most successful boom periods in American history when the top tax rate was always seventy-odd percent. Since Ronald Reagan the tax rate has always hovered – the top tax rates — hovered in the thirty percent. And what’s been the average rate of [GDP] growth since the 1970s? – it’s been about 2 percent. So don’t tell me that high tax rates are… inhibit — I mean these are the kinds of mythologies that you find.
During the grim 1970s’ crisis, there was also an alternative – destroy the power of labor and thereby raise the tax rate
But anyway, in the 1930s there was this alternative. That alternative ran out for a variety of reasons, I’m not going to go into them, in the late 1960s. We had the grim crisis of the 1970s. But in the 1970s there was also an alternative. There was a critique of Keynesianism. And a critique state involvement in the economy and that critique was well lodged in many of the think tanks — the Institute of Economic Affairs that influenced Margaret Thatcher; and then this country, you know, the Heritage Foundation, Business Roundtable, all the rest of it. And they’d all been kind of thinking well we have an alternative which is an alternative which is going to solve the problem of the 1970s in a very particular way, which is actually to destroy the power of labor and thereby raise the profit rate. And do it in a variety of ways, which included offshoring, included technological change, it included outright political assault, including coups, military occupations in Latin America and all the rest of it.
Why is there no alternative right now, in terms of social movements and new ideas?
So, there was an alternative there. But when you look right now and say where’s the alternative, in terms of social movements, in terms of actually thinking, and God, here at Penn you got the Wharton School over there. You’d have thought they could come up with an alternative by now. But now they’re so busy training themselves to go and make money that, you know, why do they want an alternative. And, indeed, why would they want to make an alternative when in fact the leading hedge fund managers, a couple years ago, got $3 billion dollars each in personal remuneration. I mean, you know, when I tell that to students they say: “How do I get there?” you know.
Right now the world is divided into two camps: one is the hysterical austerity camp pushing debt reduction
So here we are in this situation and actually, you know, I want to talk about some other issues but, but I think that right now what you see is the world divided, roughly divided, into two camps. There is the hysterical austerity camp — which largely occupies Europe and United States — which says that the answer to their difficulties right now is to retire the debt, because we became too indebted.
Actually, capital never solves its crisis problems, it simply moves them around until an impasse is reached and the final solution is to make the people pay
And it’s interesting to see, you know, how capital works. I mean one of the theses that I work out in the Enigma of Capital is the idea that actually capital never solves its crisis problems, it simply moves them around. And right now is a very good moment to actually watch this game of hot potato, you know. There it is, there it was in the housing markets of California and Arizona and Florida and all the rest of it, and then it moves into the financial institutions, and then it floods all around the world. And there’s a financial difficulty in the states: mop all of that financial difficulty up. And then all the sudden there’s a sovereign debt crisis in the States and the States don’t know how to handle it except by doing things like making the people pay.
The rise of the debt income class
And the people, at a certain point are going to say “No”, we’ve had enough. I think the people of Iceland kind of voted not to pay and I think that eventually there’s going to be a lot of movements of that kind. And we’re beginning to see that in the Occupy Wall Street kind of thing pain.
But notice how they’re shifting the burden around. And I was struck by this — yesterday we had a demonstration at CUNY over the increase in tuitions at CUNY. Now CUNY used to be a tuition-free university. I think that’s a great idea. I was actually educated in a tuition-free university system. I got right through to my PhD without paying anything. This is a sensible society. When you tell people that they say what planet did you live on?
Enough is enough! – the Chilean student movement for free education
And actually right now the demands of the Chilean student movement, in relationship to Pinochet, is we want free education because the Chilean students are probably in the vanguard of a totally indebted class of people who have to pay for their education right the way through. And people are saying this is enough is enough and they’ve occupied the universities now for five months and were going to do it for another five months if necessary until they get some answer to this compelling question.
Rockefellers showed New York State how to lower its debt by privatizing it on the backs of students through increased tuitions
But in raising the tuition at CUNY, why is that going on, how did it happen? CUNY was tuition-free up until the 1970s. Who forced tuition into CUNY? Well, the primary people engaged in that campaign were the Rockefeller Brothers. The Rockefeller Brothers didn’t like the fact that they lived in New York and they paid taxes to support this tuition-free system. And they said, you know, rich bankers in Chicago don’t have to do this and they don’t have to do it — why are we paying this? So, they set up the business roundtable and the business roundtable did some incredible things. They hired a mass of independent experts to persuade everybody that actually tuition — that educational standards at a tuition-free university were extremely low and you got a very poor education. [If you] wanted a good education, you’d have to pay tuition. And so all of this was put out in radical journals like the Reader’s Digest. And then, and then the Rockefeller Brothers paid to have these independent expert opinions from the Reader’s Digest to be republished in every college newspaper across the CUNY system as part of this attack upon CUNY.
Bankers got into debt? No problem. Make students pay down the debt.
Well now we’ve got into this situation where the bankers got into trouble and they got into debt. And because they got into debt we had a crisis. And as a result of that New York State is a bit in debt, so it’s got to retire its debt. How does it do it? Well, one of the ways is it raises tuition on CUNY. Which does what? It increases student debt. You’re privatizing the debt on the backs of students, you know. And you’re creating this debt income class of students. Now this is a good idea politically because as somebody said about, you know, the mortgage stuff back in the 1930s, the debt income, but homeowners don’t go on strike. Well debt income, but student has a very hard time making kind of political choices which are a bit risky when the debt is hanging over them. So debt encumbrance is a real, real problem.
Austerity doesn’t work; it makes people poorer, and Republicans block government intervention
So this austerity mantra, which we have, is an answer to the particular question. As we see from Ireland and as we’re seeing from Greece and all the rest of it, it doesn’t work. What it does is people get poorer and because they get poorer they spend less and the whole economy starts to go down and down further and further and further. And Keynes saw that as a problem and said well the only thing to do is have the government step in and kind of go back in the other way, but no, no, we can’t do that because the Republicans won’t let you.
END OF PART 1