The crisis of capitalism is accompanied by a crisis of bourgeois thought: philosophy, economics, morality – all are in a state of ferment. In place of the earlier optimism that stated confidently that capitalism had solved all its problems, there is an all-pervading mood of gloom. Not so long ago, Gordon Brown confidently proclaimed “the end of boom and bust”. After the crash of 2008 he was forced to eat his words.

The latest episode of the crisis of the euro shows that the bourgeoisie has no idea how to solve the problems of Greece and Italy which in turn threaten the future of the European common currency and even the EU itself. This is a potential catalyst for a new collapse on a world scale, which will be even deeper than the crisis of 2008.

The thing about the present crisis was that it was not supposed to happen. Until recently most of the bourgeois economists believed that the market, if left to itself, was capable of solving all the problems, magically balancing out supply and demand (the “efficient market hypothesis”) so that there could never be a repetition of the crash of 1929 and the Great Depression.

Marx’s prediction of a crisis of overproduction had been consigned to the dustbin of history. Those who still adhered to Marx’s view that the capitalist system was riven with insoluble contradictions and contained within itself the seeds of its own destruction were looked upon as mere cranks. Had the fall of the Soviet Union not finally demonstrated the failure of communism? Had history not finally ended with the triumph of capitalism as the only possible socio-economic system?

That was then. But in the space of 20 years (not a long period in the annals of human society) the wheel of history has turned 180 degrees. And now the erstwhile critics of Marx and Marxism are singling a very different tune. Al of a sudden, the economic theories of Karl Marx are being taken very seriously indeed. Das Kapital is now a best seller in Germany. A growing number of economists are poring over its pages, hoping to find an explanation for what has gone wrong.

Crisis of bourgeois economics

The reason for this strange conversion is not hard to find. All the theories of the official bourgeois economists have been falsified by the march of events. The economists were incapable of predicting any of the major economic events of the last thirty years. They did not predict the present recession (in fact, they denied its very possibility), but then, neither did they predict the feverish boom that went before it.

Bourgeois economic theory has been weighed in the scale and found wanting. No serious person takes it seriously. No wonder some big corporations have taken to consulting professional astrologers before deciding where to invest their money. The latter are probably better value than the products of the economics departments of the university; at any rate the success rate of their predictions would not be any worse.

In July 2009, after the start of the recession The Economist held a seminar in London to discuss the question: What is wrong with Economics? This revealed that for a growing number of economists mainstream theory has no relevance. Nobel Prize winner, Paul Krugman actually admitted “that the last 30 years development in macroeconomic theory has, at best, been spectacularly useless or, at worst, directly harmful.”

This judgement is a fitting epitaph for the theories of bourgeois economics. Nothing that has happened since then gives us any reason to doubt it. The Greek crisis that now threatens to pull the whole of Europe down, sink the euro and even break up the European Union has served to underline the complete inability of either economists or politicians to offer a solution.

In reality they have no way out. Whatever they do will be wrong. Even if (as is quite likely) they decide to pour money into Greece, the markets will turn their attentions to other countries: Ireland, Portugal, Spain, Italy, Belgium, even France. In vain does Angela Merkel wring her hands and complain about the “irresponsible” credit agencies. These are the workings of the “free market”, which they all accept. You cannot accept market economics and then complain about the inevitable consequences.

Four years after the first crisis the world is now heading for a new collapse, which nothing can prevent. Millions of people will suffer the consequences. Unemployment will soar to levels not seen since the 1930s. Living standards will fall steeply. And the inevitable result will be an intensification of the class struggle everywhere.

Whole nations bankrupt

The first phase of the crisis that began in 2008 was characterised by the default of big banks. The entire banking system of the USA and the rest of the world was only saved by the massive injection of billions of dollars and euros by the state. But the question must be asked: what is left of the old idea that the free market, if left to itself, will solve all problems? What is left of the old idea that the state must not interfere in the workings of the economy?

The massive injection of public money solved nothing. The crisis has not been resolved. It has merely been shifted onto states. All that happened is that in place of a massive deficit of the banks we have a gaping black hole in the public finances. And who will pay for this? Not those well-heeled bankers who, having presided over the wrecking of the world financial order, have calmly pocketed the public’s hard-earned money and are now awarding themselves lavish bonuses with the proceeds.

No! The deficits about which the economists and politicians are complaining so bitterly must be paid for by the poorest and most defenceless sections of society. Suddenly there is no money for the old, the sick, the unemployed, but there is always plenty of money for the bankers. This means a regime of permanent austerity. But this merely creates new contradictions. By cutting demand, it reduces the market still further, and thus aggravates the crisis of overproduction.

Now the economists are predicting a new collapse, when currencies and governments will go under, threatening the very fabric of the world financial system. And despite what the politicians say about the need to curb the deficit, debts on the scale that have been run up cannot be repaid. Greece provides a graphic example of this fact. The future is one of even deeper crises, falling living standards, painful adjustments and increasing impoverishment for the majority. This is a finished recipe for further upheavals and class struggle on an even higher level. It is a systemic crisis of capitalism on a world scale.

Second thoughts

Now that events have knocked just a little sense into the heads of at least some bourgeois thinkers, we are seeing all kinds of articles that grudgingly recognise that Marx was right after all. Take for example a recent article by John Gray in the BBC news magazine, with the title: A Point of View: The revolution of capitalism (BBC News, 4 September 2011). In it he says:

“As a side-effect of the financial crisis, more and more people are starting to think Karl Marx was right. The great 19th Century German philosopher, economist and revolutionary believed that capitalism was radically unstable. It had a built-in tendency to produce ever larger booms and busts, and over the longer term it was bound to destroy itself.”

Now this was something that people like John Gray in the past would have ridiculed. Now, however, they are forced to treat it in deadly earnest. So Mr. Gray now accepts what is becoming increasingly evident: that capitalism contains within itself the seeds of its own destruction; that it is an anarchic and chaotic system characterised by periodic crises that throw people out of work and cause social and political instability.

The Communist Manifesto is the most relevant book one can read today. It is really extraordinary to think that a book written over 150 years ago can present a picture of the world of the 21^st century so vividly and truthfully. Gray now recognises that it was astonishingly far-seeing:

“At the time nothing seemed more solid than the society on the margins of which Marx lived. A century and a half later we find ourselves in the world he anticipated, where everyone's life is experimental and provisional, and sudden ruin can happen at any time.”

While denying that socialism is the logical alternative to decadent capitalism, Gray is forced to admit that Marx understood the workings of the capitalist economy far better than the bourgeoisie and its economic “experts”:

“More profoundly, Marx understood how capitalism destroys its own social base – the middle-class way of life. The Marxist terminology of bourgeois and proletarian has an archaic ring.

“But when he argued that capitalism would plunge the middle classes into something like the precarious existence of the hard-pressed workers of his time, Marx anticipated a change in the way we live that we're only now struggling to cope with.”

Devastating condemnation

There is a growing feeling among all sections of society that our lives are dominated by forces beyond our control. Society is gripped by a gnawing sense of fear and uncertainty, as Gray admits:

“But we have very little effective control over the course of our lives, and the uncertainty in which we must live is being worsened by policies devised to deal with the financial crisis. Zero interest rates alongside rising prices means you're getting a negative return on your money and over time your capital is being eroded.”

The situation of many younger people is even worse. The crisis of capitalism has its direst effects among the youth. Unemployment among young people is soaring everywhere. This is the reason for the mass student protests and riots in Britain, for the movement of the indignados in Spain, the occupations of the schools in Greece and also for the uprisings in Tunisia and Egypt, where about 75% of the youth are unemployed.

A whole generation of young people is being sacrificed on the altar of Profit. Many who looked for salvation to higher education have fond that this avenue is blocked. In Britain, where higher education used to be free, now young people find that in order to acquire the skills they need, they will have to go into debt.

At the other end of the age scale, workers approaching retirement find that they must work longer and pay more for lower pensions that will condemn many to poverty in old age. For young and old alike, the prospect facing most people today is a lifetime of insecurity.

All the old bourgeois hypocrisy about morality and family values has been exposed as hollow. The epidemic of unemployment, homelessness, crushing debt and extreme social inequality that has turned a whole generation into pariahs has undermined the family and created a nightmare of systemic poverty, hopelessness, degradation and despair. Again, in the words of Gray:

“For many, women and the poor for example, these Victorian values could be pretty stultifying in their effects. But the larger fact is that the free market works to undermine the virtues that maintain the bourgeois life.

“When savings are melting away being thrifty can be the road to ruin. It's the person who borrows heavily and isn't afraid to declare bankruptcy that survives and goes on to prosper. (...)

“In a society that is being continuously transformed by market forces, traditional values are dysfunctional and anyone who tries to live by them risks ending up on the scrapheap.”

The argument so beloved of bourgeois sociologists that the working class has ceased to exist has been stood on its head. In the last period important layers of the working population who previously considered themselves to be middle class have been proletarianised. Teachers, civil servants, bank employees etc have been drawn into the ranks of the working class and the labour movement, where they make up some of the most militant sections.

Gray admits that the old arguments that “everybody can advance” and “we are all middle class” have been falsified by events. He says:

“In fact, in Britain, the US and many other developed countries over the past 20 or 30 years, the opposite has been happening. Job security doesn't exist, the trades and professions of the past have largely gone and life-long careers are barely memories.

“If people have any wealth it's in their houses, but house prices don't always increase. When credit is tight as it is now, they can be stagnant for years. A dwindling minority can count on a pension on which they could comfortably live, and not many have significant savings.

“More and more people live from day to day, with little idea of what the future may bring. Middle-class people used to think their lives unfolded in an orderly progression. But it's no longer possible to look at life as a succession of stages in which each is a step up from the last.

“In the process of creative destruction the ladder has been kicked away and for increasing numbers of people a middle-class existence is no longer even an aspiration.”

These words represent a devastating condemnation of the capitalist system. They show also that the social reserves of reaction have been sharply reduced as a big section of the white collar workers move closer to the traditional working class. In the recent mass mobilisations in Spain, and particularly Greece, these layers were in the front line of the class struggle.

“Marx to Market”

Marx predicted that the development of capitalism would lead inexorably to the concentration of capital, an immense accumulation of wealth on the one hand and an equal accumulation of poverty, misery and unbearable toil at the other end of the social spectrum. For decades this idea was rubbished by the bourgeois economists and university sociologists who insisted that society was becoming ever more egalitarian, that everyone was now becoming middle class. Now all these illusions have been dissolved.

Recently Businessweek carried a piece with the title “Marx to Market”, warning that Marx might have gotten some things right, but in reality he was wrong and dangerous. It expresses concern that “the gloomy, combative philosopher seems to find adherents in each new generation.” And continues:

“You might even say the Bearded One has rarely looked better. The current global financial crisis has given rise to a new contingent of unlikely admirers. In 2009 the Vatican’s official newspaper, L’Osservatore Romano, published an article praising Marx’s diagnosis of income inequality, which is quite an endorsement considering that Marx declared religion to be ‘the opium of the people’. In Shanghai, the turbo-capitalist hub of Communist-in-name-alone China, audiences flocked to a 2010 musical based on Capital, Marx’s most famous work. In Japan, Capital is now out in a manga version.”

It adds: “The vogue for Marx should be expected at a time when European banks stand on the precipice of collapse and poverty levels in the U.S. have reached levels not seen in nearly two decades.”

“As misguided as Marx was about many things, and as pernicious as his influence was in places like the U.S.S.R. and China, there are pieces of his (voluminous) writings that are shockingly perceptive. One of Marx’s most important contentions was that capitalism was inherently unstable. One only has to look at the headlines out of Europe—which is haunted by the specter of a possible Greek default, a banking disaster, and the collapse of the single-currency euro zone—to see that he was right. Marx diagnosed capitalism’s instability at a time when his contemporaries and predecessors, such as Adam Smith and John Stuart Mill, were mostly enthralled by its ability to serve human wants.”

George Magnus

So much for Businessweek. Now let us read what George Magnus, a senior economic analyst at UBS bank, recently wrote an article with the intriguing title: Give Karl Marx a Chance to Save the World Economy.

Switzerland-based UBS is a pillar of the financial establishment, with offices in more than 50 countries and over $2 trillion in assets. Yet in an essay for Bloomberg View, published on August 28, Magnus wrote that “today’s global economy bears some uncanny resemblances to what Marx foresaw.” In his article he starts by describing policy makers “struggling to understand the barrage of financial panics, protests and other ills afflicting the world” and suggests that they would do well to study the works of “a long-dead economist, Karl Marx”:

“Consider, for example, Marx’s prediction of how the inherent conflict between capital and labor would manifest itself. As he wrote in Das Kapital , companies’ pursuit of profits and productivity would naturally lead them to need fewer and fewer workers, creating an ‘industrial reserve army’ of the poor and unemployed: ‘Accumulation of wealth at one pole is, therefore, at the same time accumulation of misery’.”

He continues:

“The process he [Marx] describes is visible throughout the developed world, particularly in the U.S. Companies’ efforts to cut costs and avoid hiring have boosted U.S. corporate profits as a share of total economic output to the highest level in more than six decades, while the unemployment rate stands at 9.1 percent and real wages are stagnant.

“U.S. income inequality, meanwhile, is by some measures close to its highest level since the 1920s. Before 2008, the income disparity was obscured by factors such as easy credit, which allowed poor households to enjoy a more affluent lifestyle. Now the problem is coming home to roost.”

Magnus quotes approvingly from Marx’s Preface to A Contribution to the Critique of Political Economy (1859):

“At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or – this merely expresses the same thing in legal terms – with the property relations within this framework of which they have operated hitherto”.

Magnus says that these lines have a particular relevance to the present situation:

“The quote above captures the important idea of conflict or turbulence when events happen that lead to challenges to the power, authority and legitimacy of the existing political and economic order. During the last several months, we have seen a succession of such challenges in the Eurozone, the US, and even, in embryonic form, in China. The recent skittishness in financial markets and increase in risk premiums reflect not only a rise in anxiety about the deteriorating health of the global economy, but the draining of confidence that political elites are up to the task of addressing it.”

Magnus accepts that the present crisis is a crisis of overproduction, although he confuses this with the Keynesian notion of under-consumption – a completely different (and false) idea:

“Marx also pointed out the paradox of over-production and under-consumption: The more people are relegated to poverty, the less they will be able to consume all the goods and services companies produce. When one company cuts costs to boost earnings, it’s smart, but when they all do, they undermine the income formation and effective demand on which they rely for revenues and profits.

“This problem, too, is evident in today’s developed world. We have a substantial capacity to produce, but in the middle- and lower-income cohorts, we find widespread financial insecurity and low consumption rates. The result is visible in the U.S., where new housing construction and automobile sales remain about 75% and 30% below their 2006 peaks, respectively.

“As Marx put it in Kapital: ‘The ultimate reason for all real crises always remains the poverty and restricted consumption of the masses’.”

Naturally, Magnus advocates Keynesian solutions for the crisis: if only the capitalists (or the state) gave a bit more money to the workers, if only they would lighten the household debt burden, restructure mortgage debt, if only there could be some debt forgiveness, if only the banks would lend more money to small companies, if only Governments and central banks would spend money on infrastructure programmes, if only European creditors would be nicer to the Greeks – then all would be well.

If only, if only... If only pigs had wings they would fly! And these economists accuse the Marxists of being utopians! All that Mr. Magnus is asking is for the capitalists to behave less like capitalists but more like St. Francis of Assisi. It is like asking a man-eating tiger to eat salad instead of flesh. We know how the tiger would react to this pleasant proposal. And we know how the bankers and capitalists would react also. Needless to say, this Keynesian idiocy has absolutely nothing in common with the ideas of Karl Marx.

As Magnus notes, Marx predicted that companies would need fewer workers as they improved productivity, creating an “industrial reserve army” of the unemployed whose existence would keep downward pressure on wages for the employed.

As the previously-quoted article from Businessweek pointed out, “It’s hard to argue with that these days, given that the U.S. unemployment rate is still more than 9 percent. On September 13 the U.S. Census Bureau released data showing that median income fell from 1973 through 2010 for full-time, year-round male workers aged 15 and up, adjusted for inflation. The condition of blue-collar workers in the U.S. is still a far cry from the subsistence wage and ‘accumulation of misery’ that Marx conjured. But it’s not morning in America, either.”

Nouriel Roubini

On August 11 The Wall Street Journal carried an interview with the well-known economist Dr. Nouriel Roubini, known to his fellow economists as “Dr. Doom” because of his prediction of the 2008 financial crisis. There is a video of this extraordinary interview, which deserves to be studied carefully because it shows the thinking of the most far-sighted strategists of Capital.

Roubini is completely sceptical about the ability of governments and central banks to avert a new economic collapse, let alone get out of the present recession. He does not think that a new bout of quantitative easing, lower interest rates, or any of the other measures proposed, will make any difference: “If people do not want to borrow,” he asks, “what good will it do to lower interest rates?”

He argues that the chain of credit is broken, and that capitalism has entered into a vicious cycle where excess capacity (overproduction), falling consumer demand, high levels of debt all breed a lack of confidence in investors that in turn will be reflected in sharp falls on the stock exchange, falling asset prices and a collapse in the real economy.

He concludes that the market economy cannot avoid a recession because “there is not enough final demand.” He further relates this lack of demand to a long period when Capital has squeezed labour, and the share of profits has expanded at the expense of wages. He points to the intensification of exploitation, stagnant or falling real wages, and unprecedented levels of inequality as central to the state of the world’s turbulent economy.

Like all the other economists, Roubini has no real solution to the present crisis, except more monetary injections from central banks to avoid another meltdown. But he frankly admitted that monetary policy alone will not be enough, and business and governments are not helping.

Europe and the United States are implementing austerity programs to try to fix their debt-ridden economies, when they should be introducing more monetary stimulus, he said. His conclusions could not be more pessimistic: “Karl Marx got it right, at some point capitalism can destroy itself,” said Roubini. “We thought markets worked. They’re not working.” (My emphasis, AW)

By slashing wages, they have cut the market, reduced final demand and caused overproduction (excess capacity) on a world scale: “Because you cannot keep shifting income from labour to capital without not having excess capacity and lack of aggregate demand. And that’s what’s happening,” the economist said.

Roubini predicted there is more than a 50% chance the world will plunge into another global recession and the next two to three months will reveal the economy’s direction: “We are at stall speed right now, and we do not know if we are going to go up, or down,” he said.

Roubini says he’s putting his money in cash, with U.S. Treasury’s a smart bet. “Now is not the time for risky assets,” he said. The WSJ interviewer, by now thoroughly alarmed asked Roubini if he thought that the fall of capitalism was imminent. He replied: “We are not there yet,” but made it clear that he thought we were on the way towards a “second edition of the Great Depression”.

Was Marx wrong about revolution?

Contrary to the comforting picture that used to be presented of the capitalist system offering a secure and prosperous future for all, we see the reality of a world in which millions suffer poverty and hunger, while the super rich become richer every day: Let us return to the article of John Gray:

“A tiny few have accumulated vast wealth but even that has an evanescent, almost ghostly quality. In Victorian times the seriously rich could afford to relax provided they were conservative in how they invested their money. When the heroes of Dickens' novels finally come into their inheritance, they do nothing forever after.

“Today there is no haven of security. The gyrations of the market are such that no-one can know what will have value even a few years ahead.

“This state of perpetual unrest is the permanent revolution of capitalism and I think it's going to be with us in any future that's realistically imaginable. We're only part of the way through a financial crisis that will turn many more things upside down.”

What conclusion does Gray draw from all this? Only this: that capitalism is destroying itself: “Capitalism has led to a revolution but not the one that Marx expected. The fiery German thinker hated the bourgeois life and looked to communism to destroy it. And just as he predicted, the bourgeois world has been destroyed.”

But then he adds: “it wasn't communism that did the deed. It's capitalism that has killed off the bourgeoisie.” This is a most peculiar conclusion. The bourgeoisie has not at all been “killed off”, to use Gray’s melodramatic terminology. It is very much alive. It holds in its hands the land, the banks and the big corporations. It takes all the fundamental decisions that affect the lives and destinies of millions of people on the planet.

People like Gray are forced to admit what they cannot deny. Yes, the capitalist system is in crisis. Everybody knows this. But what is the antidote to the crisis? If capitalism is an anarchic and chaotic system that inevitably ends in crises, then one must conclude that in order to eliminate crises it is necessary to abolish the capitalist system itself. If you say “A”, you must also say “B”, “C” and “D”. But this is what the bourgeois economists refuse to do.

What Gray and people like him cannot accept is that the crisis of capitalism can and will end in socialist revolution: “Marx welcomed capitalism's self-destruction. He was confident that a popular revolution would occur and bring a communist system into being that would be more productive and far more humane. Marx was wrong about communism. Where he was prophetically right was in his grasp of the revolution of capitalism. It's not just capitalism's endemic instability that he understood, though in this regard he was far more perceptive than most economists in his day and ours.”

But wait a minute, Mr. Gray! Do you seriously imagine that a crisis that is throwing the whole world into chaos, that condemns millions of people to unemployment, poverty and despair, that robs the youth of a future and destroys health, housing, education and culture – that all this can occur without producing a social and political crisis? Can you not see that the crisis of capitalism is preparing the conditions for revolution everywhere?

This is no longer a theoretical proposition. It is a fact. If we take just the last twelve months, what do we see? Revolutionary movements have occurred in one country after another: Tunisia, Egypt, Greece, Spain. Even in the United States we have the #Occupy movement and the earlier mass protests in Wisconsin.

These dramatic events are a clear expression of the fact that the crisis of capitalism is producing a massive backlash on a world scale, and that a growing number of people are beginning to draw revolutionary conclusions. This was summed up by Michael Moore on BBC Newsnight, when he went as far as to say that “capitalism has to be ended”.

“Western nations are now ripe for revolution”

This is recognized by at least some of the strategists of Capital, like Andreas Whittam Smith, a financial journalist and founder of the Independent. On Thursday, 20 October he wrote a piece with the title: Western nations are now ripe for revolution. He writes:

“If there is going to be a revolutionary outburst, you do not get much warning. Writing of the European revolutions of 1848, for instance, one historian [Peter N Staerns] recently noted: ‘At the beginning of 1848 no one believed that revolution was imminent.’ Now the reason I have gone back to accounts of 1848 is because this date has kept popping into my head as protests against contemporary capitalism have spread round the world.

“Not Paris 1968. Nor 1917 to 1921 when, in the chaos following the First World War, workers' rule was temporarily established in some German cities. Instead I have turned to 1848, when much of continental Europe took to the streets in what came to be called the Spring of Nations, or the Springtime of the Peoples or the Year of Revolution.”

Whittam Smith, who admits that he would be “appalled at the prospect of anything approaching revolution coming our way” nevertheless thinks that there is “one good reason why we should be fearful”: the intolerable gap that has developed between rich and poor. He quotes the Occupy Wall Street slogan: “The one thing we all have in common is that we are the 99 per cent that will no longer tolerate the greed and corruption of the 1 per cent.” And he continues:

“For during the past 25 years, the gap between the incomes of the rich and the poor has been steadily widening. The disparity which began to develop in the US and UK in the late 1970s, has been spreading. An OECD study published in May showed that countries such as Denmark, Germany and Sweden, which have traditionally had low inequality, are no longer spared.

“The result is that in the industrialised West the average income of the richest 10 per cent of the population is about nine times that of the poorest 10 per cent. That is an enormous difference. And if the comparison is made between, say, the pay of the directors of large companies compared with that of their staff, the gap is astonishing. In many cases, directors earn 200 times more than their lower-paid workers. At some point, this excessive difference is going to cause trouble. Has that moment come?”

“To go back again to 1848. In another account, Professor Stearns wrote that most of the revolutions of 1848 broke out rather haphazardly. ‘There was usually a brief, confused period of demands and demonstrations, during which governmental uncertainty helped prolong the tension’.”

There are clear parallels between this and what we see now. That the present protest movement is confused in its aims is evident. But it reflects a general mood of anger that is building up under the surface and which sooner or later must find a way out. A TIME magazine poll showed some interesting results:

"US: 54% have a favourable view of the #occupy movement, 79% think the gap between rich and poor has grown too large, 71% think CEOs of financial institutions should be prosecuted, 68% think the rich should pay more taxes, only 27% have a favourable view of the Tea Party movement (33% disfavourable)."

Of course, it is too early to speak of a revolution in the USA. But it is clear that the crisis of capitalism is producing a growing mood of criticism among broad layers of the population. There is a ferment and a questioning of capitalism that was not there before. One may say that these mass movements lack a clear programme, and that is certainly the case. But they are definitely anti-capitalist movements, and sooner or later, in one country or another, the question of the revolutionary overthrow of capitalism will be posed.

Is there no alternative?

The bourgeois economists are so blinkered and narrow minded that they cling to the outmoded capitalist system even when they are forced to admit that it is terminally diseased and condemned to collapse. To imagine that the human race is incapable of discovering a viable alternative to this rotten, corrupt and degenerate system is frankly an affront to humanity.

Is it really true that there is no alternative to capitalism? No, it is not true. The alternative is a system based on production for the needs of the many and not the profit of the few; a system that replaces chaos and anarchy with harmonious planning; that replaces the rule of a minority of wealthy parasites with the rule of the majority who produce all the wealth of society. The name of this alternative is socialism.

One may quibble over words, but the name of this system is socialism – not the bureaucratic and totalitarian caricature that existed in Stalinist Russia, but a genuine democracy based on the ownership, control and management of the productive forces by the working class. Is this idea really so very difficult to understand? Is it really utopian to suggest that the human race can take hold of its own fate and run society on the basis of a democratic plan of production?

The need for a socialist planned economy is not an invention of Marx or any other thinker. It flows from objective necessity. The possibility of world socialism flows from the present conditions of capitalism itself. All that is necessary is for the working class, which constitutes the majority of society, to take over the running of society, expropriate the banks and giant monopolies and mobilize the vast unused productive potential to solve the problems of society.

In his Contribution to the Critique of Political Economy Marx wrote the following:

“No social order is ever destroyed before all the productive forces for which it is sufficient have been developed, and new superior relations of production never replace older ones before the material conditions for their existence have matured within the framework of the old society.

“Mankind thus inevitably sets itself only such tasks as it is able to solve, since closer examination will always show that the problem itself arises only when the material conditions for its solution are already present or at least in the course of formation.”

The solutions to the problems we face are already in existence. Over the last 200 years capitalism has built up a colossal productive power. But it is unable to utilise this potential to the full. The present crisis is only a manifestation of the fact that industry, science and technology have grown to the point where they cannot be contained in the narrow confines of private ownership and the nation state.

Twenty years ago Francis Fukuyama spoke of the end of history. But history has not ended. In fact, the real history of our species will only begin when we have put an end to the slavery of class society and begun to establish control over our lives and destinies. This is what socialism really is: Humanity’s leap from the realm of necessity to the realm of freedom.

The present crisis is merely a manifestation of the revolt of the productive forces against these suffocating limitations. Once industry, agriculture, science and technology are freed from the suffocating restraints of capitalism, the productive forces would be capable of immediately satisfying all human wants without any difficulty.

For the first time in history, humanity would be free to realise its full potential. A general reduction in working hours would provide the material basis for a genuine cultural revolution. Culture, art, music, literature and science would soar to unimaginable heights.

London, November 16, 2011