a. Neoclassical economics and the debt issue
Neoclassical economics is blind not only to the political dimension of debt (as a way of disciplining workers and a crucial element of an imperialist global order) but also to its economic one. The idea that aggregate levels of debt do not matter is underpinning current austerity measures. As deleveraging is taking place in the private sector, attempts at fiscal consolidation are further decreasing aggregate demand and aggravating the crisis.
b. The issue of ecological debt
Although it is coming generations that will bear the brunt of ecological devastation, we should not fall into the trap of thinking about the issue as primarily generational – as a lot of critical ecological discourse tends to do – while ignoring the class dimension. For example indigenous peoples around the world, residents of the Niger delta or Chinese economic migrants are feeling the impact of environmental degradation today while sharing none or only little of the benefits of global economic growth. Furthermore, as the examples of Katrina and Sandy demonstrate, the question of dealing with the consequences of climate change is a question of solidarity and, more specifically, of the maintenance of quality public infrastructure. Dominant discourse on ecology, although critical of environmental degradation, largely neglects its class dimension and embeddedness into the capitalist mode of production. Future generations will also not face the consequences of climate change as a monolithic whole. Rather we can expect an unequal distribution of risk. The left should strive to repoliticize the issue by stressing:
– That it is also (or primarily) an issue of class and the relationship between the core and periphery of the global capitalist system;
– That it is not a technical issue that can be solved purely by technological innovations but that it is an issue of political economy that can be addressed only through thorough reforms and in the final instance through the abolition of capitalism;
– That the problem cannot be adequately addressed through the perspective of morals and individual responsibility (like changed patterns of individual consumption), but that it is a political problem that must be addressed by political means;
c. The debt issue as a challenge for the political activation of the multitudes of people, for new political alliances and for further research
Movements against austerity measures have to a large extent managed to activate large numbers of people around the issue of both public and private debt, yet have so far failed to achieve visible changes. It seems that the crucial question is not how to politically activate the multitudes, but how to effectively organise them. Nation states have become less and less able to contain and control capital flows within their borders, making the goal of social democracy in one country almost utopian, while the fiscal straitjacket imposed on Eurozone countries has managed to strengthen this development, while at the same time highly restricting the influence of citizens on democratic institutions. A left strategy must therefore deal not only with the defense of the welfare state in a national context but must build an international movement at least on a European scale. Some points around which a strong alliance between progressive forces in the core and the periphery can be built could be:
– socialization of finance, investment steered by the needs of society;
– redistribution of surplus value from the core to the periphery in the form of productive investments;
– democratization of the EU;
– shortening of the working day and increase of wages, especially in core countries with significant trade surpluses;
– strengthening institutions of the welfare state;
d. Values and pluralism in economics, limits of pluralism
A clear sign of the success of neoliberalism is that it can successfully lay claim to the status of neutrality, both in the academic and political sphere. Its demands are presented not as choices but as objective necessity, for example as the common-sense demand that we cannot allow ourselves to live beyond our means. This apparent neutrality is institutionalized for example in the Fiscal Stability Treaty or the supposedly apolitical status of the ECB and in austerity measures that are presented as purely technical adjustments to the supposed problem of out of control public debt. In a sense these measures are truly apolitical, since they do not involve negotiations between different interests and different visions of the world, but are the more or less unmediated expression of the interest of a fraction of the ruling class. There is but one value that is taken into account: surplus value. Means have in effect become ends in themselves and ends like higher quality of life have become means to achieve the continuation of surplus value accumulation. The immediate task is to undo the neoliberal consensus that “there is no alternative” by challenging its academic and political hegemony and opening up the discussion about what kind of world we would like to live in.
e. Conclusions for further research and for academic teaching; conclusions for political education and modern left/modern socialist politics.
Formerly social-democratic parties have drifted and continue to drift to the right and unions, operating largely in national contexts, have failed to counter the stagnation or erosion of wages and worker’s rights, while social movements that have managed to mobilize impressive numbers of people around issues of debt and austerity remain largely spontaneous and politically marginal, even hostile to any form of hierarchical organization. The crucial question that needs to be answered is not so much an economical, but a sociological one: how to reform and invent new forms of organization that would be able to achieve socialism in the current conditions.
Questions for future research should include:
– how to organize people outside of the workplace (for example holders of student debt) and precarious workers;
– how to achieve this organization on a trans-national scale;
– how to strengthen intra-party democracy, responsiveness to social movements;