As I forecast in the previous post
(https://thenextrecession.wordpress.com/2014/07/08/slowing-global-growth-and-the-capitalist-future/),
the International Monetary Fund (IMF) has lowered its 2014 forecast for global economic growth. The IMF now says world real GDP will rise only 3.4% this year, 0.3% points below what it predicted in April. But, of course, as it has done in very report, it reckoned growth would speed up to 4%. It’s always jam tomorrow.
This rate of real GDP growth of 3-4% a year for the world economy is well below the average growth rate before the Great Recession, confirming the view that the major capitalist economies remain in what I call a Long Depression. The IMF moaned that “robust demand momentum has not yet emerged despite continued very low interest rates and easing of brakes to the recovery, including from fiscal consolidation or tight financial conditions”.
This slow growth is no longer confined to the major advanced capitalist economies, as the so-called BRICs (Brazil, Russia, India, China and South Africa) are slowing too. The advanced economies will grow just 1.8% this year (up from 1.3% in 2013) and supposedly accelerate to 2.4% in 2015. But real GDP growth in the emerging economies will slow marginally this year to 4.6% from 4.7% in 2013, with the hope of a pick-up to 5.2% in 2015. This includes China, which is growing at 7.4% this year.
After a terrible first quarter, the US economy will grow only 1.7% this year, although the pace is expected to pick up for the rest of this year. The Eurozone economies remain weak with average real GDP growth for the region barely above 1%. Japan will grow at just 1.6%.
IMF chief economist and sometime Keynesian, Olivier Blanchard, summed the IMF’s view: “In short, the recovery continues. But it remains weak and is still in need of strong policy support to strengthen both demand and supply…Advanced economies are still confronted with high levels of public and private debt, which act as brakes on the recovery.” So what was the answer? Blanchard called on governments to boost public investment to turn the global economy round.
Blanchard is shouting at windmills here. Business investment globally is hardly growing.
And yet public sector investment is being slashed as the easiest way of meeting the demands of fiscal austerity.
If more public investment is the answer to faster growth then it ain’t going to happen.
Much has been made in the British media that the UK economy will lead the way as the fastest growing G7 economy this year, according to the IMF expanding by 3.2%. The data for the second quarter have just come out, with a growth rate of 3.1% yoy (although that could be revised down a little later). So the UK economy has finally returned to its pre-crisis peak in 2008 – that’s after six years, the slowest recovery of the major economies!
The generally ‘unproductive’ services sector, including financial services and real estate, is now 2.9% above 2008 levels, but the production sector (manufacturing, mining etc) is still down 11.3% from 2008 and construction of new homes, roads, rail and offices is still down 10.7% from the peak. So Britain’s property price boom that is leading the ‘recovery’ is a product of low interest rates, government subsidies and very low production by private building firms.
But if Mark Carney, the Bank of England governor, is to be believed, the era of low interest rates is soon to end, with the BoE planning to hike rates before the year’s end. I doubt that but if it happens and interest rates start to rise, that could quickly burst the property bubble as millions of Brits face sharply higher mortgage costs.
The Resolution Foundation calculates that the number of UK households struggling to keep up with their mortgage payments will double to 2.3m by 2018, even under the scenario of small, gradual interest rate rises as suggested by the BoE. Even with interest rates at current historic lows, one in five borrowers said they had difficulty paying their mortgage. This was only slightly down on the one in four who said the same in 1991, when base rates hit 13 per cent.
One in four households would face repayment problems if rates rose by steps to a moderate 2.9% by 2018. And over one million would find themselves in the unsustainable position of “debt peril”, in which more than half their post-tax income went on repayments. Two in five mortgage holders are really ‘mortgage prisoners’, unable to refinance their home loans when rates rise, after stricter lending criteria came into force in April. That would leave them stranded on the standard variable rates charged by their lenders and “fully exposed” to further rate rises.
And still no sign of significant recovery in business investment in productive sectors. Shouting at windmills.
Michael Roberts Blog 
It’s tilting at windmills.
An old man tilting/shouting at windmills – sounds like me.
Don Quixote, what do you say
Are we proud, are we brave or just crazy
Don Quixote, what do you say
Are we shouting at windmills like you – Nick Kershaw
Nick Kershaw! you’re showing your age!
“After a terrible first quarter, the US economy will grow only 1.7% this year, although the pace is expected to pick up for the rest of this year.”
I’m not sure where this 1.7% figure comes from. Most estimates I’ve seen for the year are between 3-3.5%. I suspect that there will be slowing growth generally in the latter part of the year, and for a year after that, because, a similar three year pattern of slower growth can be seen in the latter part of 2011, 2008, 2005 and for every three year interval going back for about 30 years.
But, I also note that 7 of the 10 fastest growing economies in the world are now in Africa, which is an indication of the extent to which capitalism is spreading industrialisation globally faster than ever.
To see the 1.7% forecast for the US in 2014, go to the table in the IMF blog by Blanchard and the outlook update
http://blog-imfdirect.imf.org/2014/07/24/the-slow-recovery-continues/#more-7835 This is because of the huge contraction in Q1, supposedly followed by 3% rises in the following quarters.
Michael,
Thanks for the link. I suppose some attention has to be given to what the IMF says, but they do have a really poor record on forecasting GDP, as the fact they got UK growth this year so badly wrong demonstrates.
As far as I’m aware the consensus of private estimates of US GDP is concerned, they’ve been reduced because of the freak of the Q1 data, but are still in the 3% range. In fact, there was one analyst on CNBC last week saying he saw it coming in above 3.5%, which seems a bit rich to me.
As I said, I see some global slowing happening from Q3 onwards, because that has been the case with the 3 year cycle for the last 30 years, and there’s evidence that is already lining up. However, in respect of the US, if we have 4.5% growth in Q2, as a rebound for the weather induced freak figures for Q1, as some are forecasting (I think 3.5-4% is more likely), followed by 3- 3.5% for Q3 and Q4, I’m not sure how talking about a 1.7% growth rate makes any sense, even if statistically for the year that was the case.
An annualised GDP figure to take out the seasonal factors would in any case give a different figure.
If the average quarterly growth figure for the next 3 quarters is 3 – 3.5%, basing yourself on a 1.7% figure that only arises because of a freak figure for Q1, would then seem a bit like driving and deciding where you were going by looking in the rear view mirror rather than through the windscreen.
IMF is not alone in its projections. US Conference Board has projected 2014 GDP growth at 1.5%. The US Fed has reduced its forecast (June 2014) for full year growth to the 2.1-2.3% level from the previous (March 2014) 2.8-3.0% range.
Not exactly a trade secret that GDP has revised downward after the 1st Q numbers came in so much lower than forecast. All you have to do is pay attention and give up the old pollyanna cheerleading that says 2008 was just a “blip” and that confuses growth in isolated, and relatively less-developed areas, for some sort of intrepid dynamism of capitalism as a whole.
Whatever growth rate you pick it hardly amounts to a “Great Depression”.
Agree. Unless, of course, you live in Greece; or Ireland; or Portugal; maybe Spain; or the Ukraine; or Cyprus; and coming soon to Italy.
Although….I don’t believe I referred to 2008–? as the “Great Depression. Since it was the most severe economic contraction, globally since WW2, I think it’s fair to have called the period to 2010 the Great Recession.
As for the period after 2010… hell I don’t know what to call it, but PPR for “piss poor recovery” comes to mind. Does that work for you?
Oh..and “private forecasters,” like JP Morgan etc have revised down their predictions for US GDP growth in 2014 to the 2.5% range. Not that it matters…
You’re suffering from a misapprehension. i wasn’t referring to anything you wrote, as I don’t refer to anything your write (except this clarification which I know breaks the above stated rule).
Sorry about that. In that case, did anyone here call it a “Great Depression”? I mean anyone other than those living in Greece, or Ireland, or Portugal, or maybe Spain, coming soon to Italy, or in the Ukraine, or Cyprus?
Except for anyone except those under 26 years of age in Europe, or the US whose chances of finding employment are slim? none?
You OTOH did call the period from 2008- a “blip”– if I recall correctly and I’m pretty sure I do. That’s some blip. Hell, with a blip like that, who needs depressions?
For what it’s worth Wikipedia has a page called the great recession, describing the period in question:
http://en.wikipedia.org/wiki/Great_Recession
It hasn’t led to the collapse of capitalism, or even any kind of threat or challenge to neo liberalism for that matter. And it mostly hasn’t resulted in any tangible increase in revolutionary action, or even much in the way of serious class struggle. The same bastards are still in charge.
So whether it was a great recession or not is rather beside the point.
Indeed.
Well, in fact it did call into question “neo-liberalism” to the point that the once and future huckster of Ayn Rand capitalism, that putty faced charlatan Greenspan, a man who once wrote a glowing recommendation of Charles Keating’s petition to take over a savings and loan bank, was roundly excoriated by his once and future admirers in the US Congress.
And it has led to massive demonstrations, and a few battles of workers vs. police, in France, in Spain, in Greece.
Basically, the point is, it ain’t over. The issue isn’t calling it whatever anybody wants to call it. The issue is the “was”– as if the capital is not again approaching that point where the cyclical and structural declines will coincide and push forward serious class struggle.
Edgar,
None of those things could have led to anything progressive. As Trotsky points out in “Flood Tide”, and in “The Curve of Capitalist Development”, workers consciousness is not raised, but lowered during periods of recession and depression. It is only during long periods of boom and security that workers can rebuild their organisation, and begin to develop their own alternatives and strength. Its on that basis that revolutionary periods arise not in periods of depression, but only in the conjuncture at the point of the end of the boom.
But, that is only the objective condition. For it actually to become a revolutionary situation requires also the subjective condition, that the workers during that previous period actually have rebuilt their organisations, and been armed ideologically.
In the period of boom that ran from around 1842 to the late 1860’s, that happened. Marx refers to the fact that unusually for a declining industry, agricultural workers wages rose between 1849 to 1859, even though grain prices fell. They rose for several factors, but one main factor was that the boom meant that the demand for labour in the towns was rising rapidly, so agricultural workers flocked to the better wages and conditions of the towns.
But, more notably, as Marx documents, during this period, as workers became stronger, they were also ideologically armed. They began to develop their own forms of property, and their own self-government based upon it. They developed co-operative enterprises that grew massively. Those co-ops, as Marx had advised, put aside a proportion of their profits for workers education, each co-op having its own reading room, and providing instruction. They provided welfare for their workers and members. But workers self-government also took the form of other forms of independent working-class education, as well as worker owned and controlled social insurance through the development of the workers’ Friendly Societies.
As Marx put it, in his Inaugural Address to the FI, it was these examples of workers self activity and self government that were far more important than reformist measures like the passing of the ten Hours Act. It was this strength and ideology that made possible the Paris Commune at the point of conjuncture.
The fact is, as Lenin points out, and Luxemburg agrees in “Reform or Revolution”, the struggles that arise due to economic weakness are not class struggles, but only sectional struggles. Rather than being a basis for the development of class consciousness they are the breeding ground of reformism, syndicalism, sectionalism and the natural corrollary, regionalism and nationalism. They breed only a Trade Union consciousness.
In the 1970’s, revolutionaries characterised the SWP/IS as syndicalist, because its programme was based on exactly this kind of idea that revolutionary consciousness could develop out of repeated industrial struggle, and more militancy. It didn’t, when the economic conditions changed in the late 1970’s and 80’s, it left the workers ideologically unarmed.
During that same period all revolutionaries characterised the Militant as reformists, because their perspective was based on socialism being delivered from on high by a left-wing Labour Government. The pinnacle of their ambition was the Fabian demand for a Labour Government to nationalise the “200 top monopolies”. Once again this nonsense – which fortunately never had any chance of being implemented, because it would have led to a military coup and the slaughter of workers – left workers ideologically unarmed.
The following period of Depression during the 1980’s and 90’s, did not lead to radicalisation, but as it always has to reaction, and the workers being put on the back foot. In the 1930’s it led to fascism and authoritarianism across Europe, and a strengthening of other forms of National Socialism, personified by Stalinism. In the 1980’s it only took the form of Thatcher and Reagan. If there were any chance that the current period will be a period of depression, that would be very bad news for workers, and any possibility of a progressive development of workers consciousness.
The point isn’t about “leading to things progressive.” The point is class struggle and what impact capitalist recession, contraction has on that class struggle. And the impact is not always negative as Boffy would have everyone believe.
The 1930s Depression did produce an increase in class “consciousness”– and the only way we can measure that is through class struggle. Some might want to disregard the Spanish Civil War, the struggles for industrial unionism in the US, the strikes and workers’ risings in Vietnam, and France, the oil workers’ strikes in Trinidad, but those are the battles the defined the 1930s, even in their defeat.
If we want to like back further, the Paris Commune did not occur during a period of robust capitalist expansion, and the great US railroad strike of 1877 in the US took place during a sharp contraction when the railroad owners cut the wages of workers.
Doesn’t mean depression is always or mostly “good” for class struggle; doesn’t mean things have to “get worse,” to “get better.” It just means that history doesn’t fit into the neat little boxes Boffy would like it to.
And if 2008-??? doesn’t qualify as a sustained depression, exactly what criteria are used to characterize the period of the 1980s and 1990s as a depression?
Boffy,
I think I lean towards sartesian on this particular point, i.e. history doesn’t fit into neat little boxes. Though as an underlying principle I see socialism being linked with a certain level of economic development, therefore depressions that knock back economic development hamper socialist development. Having said that, it would have to be a catastrophe to knock back economic development so much that it objectively disqualified socialist development. That is an end of times type scenario. Some post nuclear event or something around oil running out.
So the so called recession of 2008 wasn’t a recession that knocked back economic development and therefore in theory should not have changed the objective conditions, other than ruling class propaganda that said we ‘all’ had to tighten our belts.
You would think that when the economy is objectively still on a sound footing but everywhere there is austerity, this would really kick start some class consciouness and really see far reaching class struggles.
But I don’t see it, outside Greece, Ukraine, parts of the Middle East and the way some of those struggles are progressing I am not sure we aren’t ending up with something worse then before! Certainly not the sort of class struggles that question capitalism as a system. I really see no progress in this area, whatsoever.
So whether it was a great recession or not, or whether the objective conditions allow for progress or not, it all seems pretty academic.
Edgar,
I wasn’t suggesting that depressions remove the objective conditions that make Socialism possible. I was suggesting that they create the objective conditions under which its difficult for workers to make progress, and thereby undermine the development of workers class consciousness.
That is what Marx and Engels, and Lenin and Trotsky, and Gramsci, and most other Marxists also say. As Trotsky puts it the workers need to feel “firm ground beneath their feet”. This is why revolutionary upheavals, as Trotsky points out, and Kondratiev makes the same point, occur not when this is a period of depression, but at the point of conjuncture at the end of a boom.
As Lenin points out, strikes are not acts of class struggle, but merely sectional, reformist struggles, that breed a reformist consciousness. I’ve always found Luxemburg’s position rather odd, and certainly the position of Luxemburgists like the SWP.
On the one hand, in Reform and revolution, she argues this point that trades unions are reformist organisation, transferring bourgeois ideas into the working-class. On the other hand she beleives that somehow out of all these individual strikes, there can arise spontaneously the “Mass Strike”, which is a revolutionary act of class struggle.
Well that may be so but if 2007 wasn’t the start of a recession or depression but was merely a blip, then doesn’t this stand:
“You would think that when the economy is objectively still on a sound footing but everywhere there is austerity, this would really kick start some class consciouness and really see far reaching class struggles.”
“On the other hand she beleives that somehow out of all these individual strikes, there can arise spontaneously the “Mass Strike”, which is a revolutionary act of class struggle.”
I don’t see what is odd about this. Without the experience of those individual strikes, that workers unavoidably engage in with some frequency, then the mass strike wouldn’t really have any base. It would have to spring from nowhere.
Edgar,
The recession that began 4Q 2007 certainly did “knock back” “economic development” on a global scale, with world trade experiencing its steepest declines post WW2; with global industrial output dropping more sharply than in any other recession (despite the vaunted, and vastly exaggerated, “shift” to the BRICS).
And I would say that such deep contractions, followed by such a PPR has “changed objective conditions.” Certainly has for the youth in the EU where unemployment for their age group runs close to, if not greater than 50%; certainly has changed “objective conditions” for the Ukraine with the shutdown of its steel industry…
“This rate of real GDP growth of 3-4% a year for the world economy is well below the average growth rate before the Great Recession, confirming the view that the major capitalist economies remain in what I call a Long Depression.”
On Monday I forecast that US GDP would rise between 3.5 – 4%. Its just been announced at 4%.
We shouldn’t get our pants wet with excitement over this. For example in 2013, the 3Q annualized rate was 4.5% followed by the 4Q 3.5%– and GDP for the entire year of 2013? At 2.2%, below the 2012 increase.
BEA’s full report is at: http://www.bea.gov/newsreleases/national/gdp/2014/pdf/gdp2q14_adv.pdf
Edgar,
The point is, as Lenin says, that these individual strikes are not acts of class struggle. Marx describes them as guerrilla warfare, defensive responses by workers, that they should not waste too much effort on, because they lead nowhere.
Or actually, as Lenin points out, they do lead somewhere, they lead to a reformist trade union consciousness, because they generate the idea that workers interests can be achieved by negotiating within the system. Its epitome is the creation of bourgeois workers parties for whom that is the guiding principle.
But, actually its worse than that, because as Lenin points out, these individual strikes, by definition are sectional. The driving force of them is to seek solutions to problems on a sectional basis. In the past that led to craft exclusivism. It leads to demands for the maintenance of differentials. When various actions are particularly defensive, it leads to demands to close this factory rather than this one, get rid of older workers rather than younger workers, women workers not male workers, and even black workers rather than white workers.
It does so, because the very conditions of economic weakness that exist during periods of stagnation, result in the very factors that always underpin capitalism – the competition of worker against worker, which breeds individualism, one reason why TU membership is always a minority – being increasingly magnified. The obvious extension of this is the kind of demands for “British Jobs for British Workers” that are raised, or the demand of the CP for Import Controls, and Immigration Controls, or other nationalistic demands to leave the EU and so on, supported by nationalist elements of the Left. The ultimate logic is the defence of “sectional” interest that leads to imperialist war.
So, the point is that there is no logical connection between these individual sectional strikes, and the mass strike. The mass strike is then simply left out there hanging in mid air, apparently arising spontaneously from nowhere.
As for,
“You would think that when the economy is objectively still on a sound footing but everywhere there is austerity, this would really kick start some class consciousness and really see far reaching class struggles.”
There are several points. Firstly, it depends where you look. Actually, back in 2007, as I reported at the time, the main fear was inflation, because workers WERE starting to raise their heads and take action. German workers had just obtained large pay rises. In Britain, tanker drivers got a 14% pay rise, even though even the day before it was settled the media were talking about the workers living in cloud cuckoo land if they thought that they could get such a rise!
In China, despite the oppressiveness of the state, there have been loads of wildcat strikes, and signs of unofficial union organisation. The Arab Spring was actually sparked by workers strikes in Egypt, and that came on the back of increasing strength of workers in the preceding period as the economy grew rapidly. There are similar indications in Latin America. And, of course, the place where the current boom is most marked is Africa, and for months now, newly formed unions have been engaged in militant struggles against mine owners.
But, the other point is that the building and rebuilding of workers organisations does not occur mechanically, or at the same pace everywhere. It is governed by the laws of combined and uneven development. In Britain, in the 1950’s the shop stewards movement did not simply arise over night. But, more importantly, it also depends upon the ideological arming and rearming of the workers.
One of the measures of just how far back the political leadership, the advanced guard of the labour movement has gone can be seen by comparing the current situation with the past. In a previous post, I pointed out that in the 1970’s and 80’s revolutionaries characterised the Militant as reformists because the pinnacle of their political programme was “nationalise the 200 top monopolies”, which they trotted out at LP conferecne, and every other opportunity they could.
But, compare that with today. The same revolutionary sects that criticised the Militant for that back then, today at every opportunity put forward as their solution to particular problems the nationalisation of the particular firm or industry, as though its likely David Cameron would do that in workers interests, let alone would volunteer to give those workers control over that industry, having done so!
Its rather like Lenin’s admonition of the Anarchists, when he said, “The Anarchists go in for violence retail, whereas we Bolsheviks go in for it wholesale!” At least the Militant went in for their reformism wholesale, whereas today the “revolutionary” sects go in for it retail.
You really cannot expect that without adequate ideological rearming of workers to have taken place in the intervening period, that workers will everywhere respond immediately with a militant or adequate reaction. But, what is clear is that other reactionary forces that have a clear ideology, are being able to organise on that basis.
Fortuntaely, what is also clear is that workers here and there are responding with their own solutions, which is why the number of co-ops continues to grow. Its why we see new solutions such as the link up of the United Steel Workers with Mondragon – http://www.usw.org/union/featured-projects/co-ops-resources-and-updates – to spread worker owned businesses across North America and so on.
So the lesson to be learned? No to strikes, Yes to worker owned businesses? FFS, anybody remember the LIP Strike? Italy’s factory takeovers; Argentina’s worker seizure and operation of owner abandoned factories? Where did any of that, and those are real examples of developing class consciousness, ever occur WITHOUT strikes; separate and apart from strike waves.
Short version– more nonsense from Boffy.
“You really cannot expect that without adequate ideological rearming of workers to have taken place in the intervening period, that workers will everywhere respond immediately with a militant or adequate reaction”
I noticed in an earlier comment you used the phrase ‘ideologically armed’, but this clarifies it more. This begs the question, does an economic boom or an economic contraction better lay the ground for that ‘ideological rearming’? And if it is the former why haven’t we seen it over the past, say, 40 years? Why have we seen the reverse?
I am getting slightly confused in relation to strikes as class struggle (or not). In response to my observation that I hadn’t seen any significant class struggles resulting from the 2007 ‘crisis’ you provided the following examples:
“German workers had just obtained large pay rises.
Tanker drivers got a 14% pay rise
In China, despite the oppressiveness of the state, there have been loads of wildcat strikes, and signs of unofficial union organisation.”
But you claim that strikes are not class struggles. So if strikes are not class struggles then how can you use strikes as examples of class struggle?
Edgar,
I’d been too busy to get the actual quote from Lenin I was looking for the other day to illustrate what I was saying. This, however, describes it fairly clearly. Here, Leninist arguing against the misconceptions of the Economists in this regard. He sets out how during a period of boom, workers are able to obtain pay rises fairly easily, and build their organisations and confidence, but the turn of the conjuncture to crisis demonstrates why strikes and trades unions are then no use, and why the economic struggle has led to such misconceptions.
““By means of strikes, the workers were able in some places to force concessions from the employers with comparative ease, and this “economic” struggle assumed an exaggerated significance; it was forgotten that trade unions and strikes can, at best, only win slightly better terms for the sale of labour-power as a commodity. Trade unions and strikes cannot help in times of crisis when there is no demand for this “commodity”, they cannot change the conditions which, convert labour-power into a commodity and which doom the masses of working people to dire need and unemployment. To change these conditions, a revolutionary struggle against the whole existing social and political system is necessary;”
(Lenin – Another Massacre in Collected Works Vol. 5)
But, of course, Lenin’s point, and this applies also to his argument against Luxemburg’s spontaneism, is that workers do not automatically come to this class consciousness of the need for such a “revolutionary struggle” and in fact, the previous economistic approach mitigates against it. It is only the intervention of Marxists into those previous struggles, to point out their limited nature, that can begin to develop class consciousness amongst the workers, and the need to focus not on these strikes etc. – even though they may be inevitable – but to begin to develop their own co-ops, their own party and so on, and to thereby undertake real class struggle.
Edgar,
There has not been 40 years of boom. The post war long wave boom ended in 1974. True to form, at this point of conjuncture, we see large scale confrontations, just as happened at the end of the boom that ran from around 1842 to the late 1860’s (Paris Commune), and happened with the boom that ran from early 1890’s to around 1914-20 (Russian revolution, German revolution, other European revolutions, UK General Strike, Chinese revolution etc).
This period can run for perhaps 10 years, during which the workers must either win or be forced back. That was the case in each of the above instances, including being forced back in Russia by Stalinism.
The period of stagnation ran from 1974, to 1999. During this period, as happened on each previous occasion the workers organisations were weakened, workers became divided and atomised, and class consciousness was driven backwards.
On German wages etc. I wasn’t suggesting that this represented class struggle. I was suggesting that this represented the workers getting firmer ground beneath their feet, to use Trotsky’s phrase, that they were beginning to rebuild their organisations and so on, which is a precondition for moving forward.
The question is once you have obtained some respite, and begun to rebuild those organisations, on what ideological basis are you building, what is the perspective? Is it simply to engage in repeated economistic struggles that reinforce bourgeois ideas, or is it as Marx encouraged via the International, to use the unions to build more effective solution, to build co-ops, to engage in wider political struggles etc.
Stagnation 1974-1999? That’s interesting. Boffy has capitalism entering an expansion period right about the time that overproduction and the coincident decline in profitability were driving capitalism into contraction after the very real expansion that started in 1993.
What’s more conducive to class struggle, “boom” or “bust”? The answer is a clear unequivocal “That depends.” It depends on the particulars of each situation in each location, and whether or not those particulars can reach some sort of coalescence, a “critical mass” so to speak.
Was the so-called “boom” of 1896-1914 more conducive to class struggle than the period after 1914? Was it more conducive to class struggle than the so-called “long depression” (actually long deflation) that preceded it? You make the call. Kind of depends where you were, no?
As for the post WW2 “long wave boom”– that ended in many places well before 1974– like around 1969-1970 and precipitated an uptick in class struggle– the popular unity government in Chile and its overthrow 1970-1973; Portugal 1974; with strike activity peaking in the US in 1974.
This:
“Or actually, as Lenin points out, they do lead somewhere, they lead to a reformist trade union consciousness, because they generate the idea that workers interests can be achieved by negotiating within the system. Its epitome is the creation of bourgeois workers parties for whom that is the guiding principle.
But, actually its worse than that, because as Lenin points out, these individual strikes, by definition are sectional. The driving force of them is to seek solutions to problems on a sectional basis. In the past that led to craft exclusivism. It leads to demands for the maintenance of differentials. When various actions are particularly defensive, it leads to demands to close this factory rather than this one, get rid of older workers rather than younger workers, women workers not male workers, and even black workers rather than white workers.”
Followed by this:
“I’d been too busy to get the actual quote from Lenin I was looking for the other day to illustrate what I was saying. This, however, describes it fairly clearly. Here, Leninist arguing against the misconceptions of the Economists in this regard. He sets out how during a period of boom, workers are able to obtain pay rises fairly easily, and build their organisations and confidence, but the turn of the conjuncture to crisis demonstrates why strikes and trades unions are then no use, and why the economic struggle has led to such misconceptions.”
Priceless. You see, strikes are counterproductive because among other things they lead to the illusion that the struggle can be satisfied within the framework of capitalism, but winning pay raises “fairly easily” — without strikes I presume– and building their organizations– what organizations are those? well according to Lenin’s own illogic, only trade unions which are necessarily sectoral, divisive and of no use. etc– that’s not counterproductive one bit.
So much for the strike of the Cambodian textile workers; or those in Bangladesh; or that in Lordstown, Ohio in 1974. And that hot autumn in Italy? Absolutely divisive, sectoral, and of no use.
Total confusion is what Boffy presents as clear analysis, although to be fair, he’s in good company. Lenin himself was a primary merchant of these inferior goods.