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The Great Recession

Economic Crisis

Illustration by Galen Johnson

Capitalism is currently enmeshed in its most calamitous economic crisis since the Great Depression. And, just as in that earlier historic conjuncture, while visiting enormous trauma and privation upon working people, this crisis pried open the seams of the system in a way that opened up possibilities – too soon foreclosed – for a different tomorrow. So, the current crisis is a watershed, heralding both pain and the prospect of change.

Today’s economic meltdown caps more than three decades of struggle by capital to cast off the constraints imposed by an interventionist state and to liquidate the gains made by labour in the advanced industrial countries between the 1940s and the 1970s in the form of higher wages, job security and benefits like pensions and health insurance. Buoyed by the collapse of the Soviet Union, neoliberalism succeeded in sapping the welfare state, in shifting job creation increasingly away from stable employment and toward precarious work, and in reducing labour’s share of the national income.

Already the financial crisis is being manipulated to put the finishing strokes on the destabilization of the working majority. Any hope that the now widely acknowledged failure of unregulated capitalism might herald a 1930s-style New Deal designed to tilt the balance back, slightly, in the interests of the working and middle classes must be tested against the dubious nature of the bailout and stimulus packages being devised by governments across the western world. To date, remarkably few conditions have been attached to the billions of dollars of public money being transferred to private companies.

And where will the wisdom come from in tackling the crisis? Here in Canada, Harper’s government has appointed an economic advisory committee: a club of millionaires and billionaires, who, having made out like bandits for decades, are now generously offering their sage counsel to the state for a mere $1. A real bargain from the folks who brought us the abyss.

Moreover, there is no indication of any respite on the part of the rapacious rich from the assault on labour. On the contrary, the tried-and-true tactic of capital and its minions is to scapegoat working people. The pain must be shared, goes the mantra; there is no room in these tough times for decent wages and benefits. Sharing – a wicked socialist conspiracy when it comes to wealth and profit – is now a commonsense expectation in relation to economic pain. We should be content to let wealth trickle down; pain, however, must be shared. Already we are witnessing a renewed attack on unions and job security, on wages and benefits, as a counterpart to the limited regulation of capital likely to be imposed. With the Big Three automakers hustling for government handouts, the trope of the overpaid autoworker was sure to be trotted out.

We can also expect the faltering economy to be used as the pretext to brush aside urgent environmental concerns, supposedly in the name of stimulating growth and preserving jobs. The Left especially must be wary of this siren call. It is clear that job losses will be major. They have only begun, and they are even more severe than anticipated. But the solution is not job creation at any cost.

Indeed, now is an opportune time to call for a reconsideration of these very ideas of growth and development. Consciousness of the threats to long-term survival in the form of climate change and other environmental disasters is at an all-time high. And the very fate of humankind hangs in part on the choices that are made now regarding energy and industry. It behooves us as leftists, but also as ecologists, to press hard for investment in alternative energy, to make public investment in the auto industry contingent upon allocating the lion’s share of resources to public transportation.

As leftists and ecologists looking at a mounting crisis of joblessness and precarious employment, we can also take a leaf from the last Great Depression, during which the labour movement made the reduction of working time a priority. In the U.S., the Senate actually passed the 1932 Black-Connery Bill, reducing the work week to thirty hours, and it would have become law had it not been for the bitter opposition of business leaders, who peddled a new gospel of consumption instead.

At a moment when unregulated capitalism is so thoroughly discredited, we can call for deep reforms within the framework of a chastened capitalism. But as longstanding critics and opponents of a system that, no matter how restrained, will always push production for production’s sake and unbridled consumerism, we can also take advantage of the fissure in the hegemony of ruling ideas to foster a renewal of radical politics.

While the 1990s were grim ideological times with Margaret Thatcher’s “There Is No Alternative” as the reigning dictum, opposition to capitalist globalization did reinvigorate the Left, spurring energetic social movements across western Europe and North America. This anti-capitalist current in the West has a natural ally in the progressive ecological movements and can draw inspiration from the resurgence of socialism in Latin America. The financial crisis is a propitious moment, then, for the Left to rally the forces of change and move our thinking “beyond capital,” with its recurring boom-and-bust economics wedded to a profoundly destructive mode of development. History, evidently, is alive and well.

This article appeared in the March/April 2009 issue of Canadian Dimension (The Great Recession).


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