Capitalism's Latest Crisis

Crisis is inherent in Capitalism. In fact, the only good thing about capitalism is the ability to create such crisis and wash away the old and the inefficient, some people will say. This is indeed cruel system, which runs counter to natural human instinct of sympathy for the weak and the old and the like, but it is its self-healing nature, rather than its ability to create a better way of life, has kept it going when other competing systems have failed.

As we are in the middle of another, worldwide, crisis, such thoughts are indeed reassuring. Many people may yet again jump out to pronounce capitalism dead, but we have been there before. Every crisis over last 150 years have been seen as Capitalism's final crisis, and every time it has emerged relatively unscathed, and looked like a stronger system, only to absolve in another crisis in a few years time. 

Indeed, just like the doomsday preachers, there are others who saw the end of history at the upturns that ended recessions. This is in the see-saw of such sentiments, our post-modern vision was formed, in somewhat cynical rejection of all such grand narratives and consequent acceptance of a mere actor's role in the order of things. And, with such abdication of activism by us, the crisis and the recovery and the crisis that must follow have all become more virulent, far more impersonal but far more impacting, and with each wave, the power has shifted away from the man on street to those sitting in cubicles and their bosses, who can direct drone attacks on daily lives with far more impunity. 

The latest crisis, once the dust has settled on stock and bond markets, can be seen as the drone-masters' inability to trust themselves. We have constructed such a sophisticated system of financial instruments that the 'money' economy has increasingly become detached from the real economy. While the earlier generations used their intellect to understand and explain the real world, we somewhat believed that we have achieved a complete understanding and now can play with constructing the reality. What we ended up doing is constructing a reality that bears no semblance with the real world. The latest crisis seems like someone somewhere just called the bluff (Michael Lewis' wonderful 'The Big Short' portrays some of those oddballs and sociopaths who did just that) and suddenly the masters of universe can see that they were all living in an wonderland. It seems that the Truman show time is over.

But this isn't yet the final crisis that Marx hoped for, or Lenin wanted to engineer. This is yet another episode when the self-heal mechanism of the system will be at play. It will make a lot of people very miserable, and power balances will change. But more will be needed to turn this into a full scale social catastrophe. Indeed, the stage is ripe, we have some terrible leadership across the world, not least in America. The social consensus that held together for last 150 years, the promise of progression for a middle class which kept the society together, is crumbling. But someone somewhere has to cross the madness threshold and start the meltdown. There are lots of mad people already, not least the UBS trader who has pushed the bank to the brink and Angela Merkel, who is hiding her head in sand and thinking that the crisis will go away, and surely Barack Obama, who is turning out to be the first post-modern president of America who seems to believe in nothing, and indeed jointly they can start the bloodbath, a real one. However, for the moment, only the middle class dream is vanishing and there is time for us to have another round of capitalism.

I shall predict that's what will happen: We shall overcome this crisis and live for another, bigger one. But, eventually, this will end: If we are lucky, we shall discover economic sanity and build systems on, I would like to say, equality of opportunity and sympathy for the less able (I shall return to this discussion in a future post), and somewhat maintain the journey to prosperity. But, it may also turn out to be the opposite, a less than final catastrophe now, but something that spirals into war and social dissolution later on. Despite the pessimism that's on the air, I shall keep looking forward and hope that we shall discover our senses and interrogate the systems we have built so far. It is that tendency to self-question that has made the human species a survivor: Let blind faith on a debunked system not take it away.


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