Late Capitalism and Neo-Liberalism by Michel Husson, January 2012, 8pp

to read Michel Husson’s pdf essay “Late Capitalism and Neo-Liberalism,” January 2012, 8pp, click on

http://hussonet.free.fr/loulou12.pdf

“…the European Union is not ready to solve its institutional problems and to dare to exclude the financing of public debt from the speculative markets. Therefore, the euro remains under threat and defaults are still possible. These contradictions highlight a `chaotic regulation’ as part of the difficulty to readdress the social regulation as part of the recovery towards a new wave of growth and accumulation.

Our conclusion, as far as the theory of the long waves of capitalist development is concerned, is that we live through the skirmishes of a major social change that neoliberal struggles do impose. The convergence of the debt crisis, the major budgetary restrictions and demand contraction, with the threat of a new recession in Europe, the transformation of the laws ruling the labor market, the lowering of the wages and pensions, provide an explosive framework. This is a systemic crisis not just because of its inner dynamices, but also because of what is at stake with the dominant strategies.

For the thirty years after the Second World War, a regulated capitalism was based upon mass consumption augmented by the wage increases. Afterwards, in the three decades of deregulated capitalism intheneoliberal mould, demand was fuelled by debt. Nowadays, neither wages nor debt: demand is restricted. Capitalism, in the period of the transition between two Kondratiev long waves, is therefore radical: social regression is offered to the majority of the population as the only hope for the future.”

Michel Husson offers many incredible graphs in his pdf essay: Graph 1: The curve of capitalist development, Graph 3: Growth rate of per capita GDP (1980-2008), Graph 4: Distribution of income, Graph 5: Configuration of the world economy and Graph 6: Emerging economies. He proves the “boomerang effect” in Graph 6. As a recent UN report states, “the global recovery has been dragged down by the developed economies.” Indeed, it is up to the emergent economies to propel the dynamics of capitalism, as shown by Graph 5. For the last two decades (1991-2011) industrial production augmented 24% int he advanced countries. For the same period, it’s growth was 2.4 times in the emerging countries and tjheir part in world exports is now 51%. There is no precedent in the history of capitalism and this implies further contradictions and major changes.”

Readers are encouraged to read Frederick Engels’ article from 1844. Engels taught us that nature has a history and that the negative – conservation of energy – is bound to the negative – transformation of energy.!

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