"The coronavirus crisis has revealed the fragility of a system built on decades of financialisation and globalisation."

Photo credit: The Independent.

Excellent magazine, equally fine article.

Tribune is a democratic socialist political journalism founded in 1937 and published in London. While it is independent, it has usually supported the Labour Party from the left. From 2009 to 2018, it faced serious financial difficulties until it was purchased by Jacobin in late 2018, shifting to a quarterly publication model.

Tear it down.

Coronavirus Has Exposed Capitalism’s Weaknesses, by Costas Lapavitsas

The coronavirus crisis has revealed the fragility of a system built on decades of financialisation and globalisation – but the task for the Left is to offer a real alternative, argues Costas Lapavitsas.

The coronavirus crisis represents a critical moment in the development of contemporary capitalism. To be sure, the crisis has longer to run — and its full impact on the USA, the EU, China, Japan and developing countries remains to be seen. But there is no doubt that it has posed the threat of a massive depression across the world economy. The systemic failures of financialisation and globalisation were starkly revealed by the public health emergency, and the state has become ever more implicated in sustaining this failing system. However, the character of its interventions give no reason to think that there will be a transformation at the top of the political and social hierarchy resulting in policies that favour the interests of working people.

The US government’s decision massively to augment its deficit — and thus its borrowing — while simultaneously expanding the supply of money and driving interest rates to zero, is essentially the same as after 2007–9. Even if a depression is avoided, the medium-term results are also likely to be the same, since the underlying weakness of capitalist accumulation is not confronted. But there will certainly be political contradictions arising from defending the neoliberal order, not least given the demonstration of nation states’ power to intervene in the economy. These will be particularly important in the EU, where the fiscal and health emergency response to the crisis has so far come from individual nation-states rather than the collective institutions.

Casting a harsh light on the inadequacies of neoliberal capitalism, this crisis has directly posed the issue of democratic reorganisation of both economy and society in the interests of workers. There is an urgent need to confront the chaos of globalisation and financialisation by putting forth concrete radical proposals. That also requires forms of organisation capable of altering the social and political balance in favor of working people.

The pandemic has brought to the fore vital issues of social transformation. It has vividly illustrated the imperative of having a public health system that is rationally organised and capable of dealing with epidemic shocks. It has also posed the urgent need for solidarity, communal action, and public policies to support workers and the poorest faced with lockdowns, unemployment, and economic collapse.

More broadly, it has reasserted the historic need to confront a declining system that is locked in its own absurdities. Unable rationally to transform itself, globalised and financialised capitalism instead keeps resorting to ever-greater doses of the same, disastrous, palliatives. The first requirement, in this respect, is to defend democratic rights from a threatening state and insist that working people have a powerful say in all decision making. Only on this basis could radical alternatives be proposed, including large-scale measures such as designing industrial policy to address the weakness of production, facilitating a green transition, dealing with income and wealth inequalities, and confronting financialisation by creating public financial institutions.

The coronavirus crisis has already transformed the terms of political struggle — and socialists must urgently respond.