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24. November 2008
29 min.
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Correction
On a superficial level, it could indeed appear that the financial markets constitute the original cause of the increasing economic pressure on society as a whole. Who could deny that the markets have taken on historically unprecedented levels of significance and have a stronger influence than ever on economic development? Does that not itself almost amount to blaming them primarily for social misery? It is not simply because they reflect surface-appearances that polemics against hedge funds, private equity funds and other players of the financial markets (particularly those that use ideologically incendiary images such as 'locusts' and 'blood-suckers')1 find such strong resonance in the public sphere.
More than that, they can find support in the widespread preconception that finance capital, banks and 'speculators' are responsible for most of the evils of capitalism, because they supposedly extract their profit at the expense of 'honest labour' and of 'productive entrepreneurship', without themselves lifting a finger. Thus the frequent denouncements of the 'insatiable greed' of speculators who are supposedly in search of 'excessive rates of return', as if capitalist production were not by its very nature based on the maximisation of profit, as if it didn't already stop at nothing in pursuit of this aim.
This is clearly no critique of capitalism: it is at best a nostalgic look back at the post-war regulation of capitalism by a social state, in a world that was still 'in order'. Worse still, it opens the door for delusional antisemitic projections, at the core of which is the division of capital into a (concrete) 'creative capital' and an (abstract) 'grasping capital', in which 'the speculators' are identified with 'the Jews', who reputedly pull the strings behind the scenes of global economics and politics. This dangerous ideological combination has in recent years been identified and criticised many times – I thus don't treat it in further detail here.2 I shall instead concentrate on evidence for the claim that these one-sided attacks on finance capital also turn the cause-effect relationships of the functional logic of capitalism on their head, which blocks the way not only for an analysis of the ongoing crisis, but also for an adequate opposition to the unreasonable social and political demands that are bound up with it. The long-term repercussions of the crisis of Fordism
A glance at history shows that the development of large-scale speculative and credit-bubbles has never been the cause of capitalist crises; rather, it has always been simply a consequence and stage in the development of the crisis-process, the causes of which can always be traced back to stagnation in the valorisation of capital in the real economy. This is no less true for the current financial crisis and for the long period of speculation that preceded it, even if there are certain characteristics that distinguish it from previous crises.
It is generally recognised that it was in the mid-1970s that the financial markets first began to grow rapidly and become independent. This was not, as is often asserted now, caused by any deliberate political decision or by the influence of neo-liberal think-tanks and powerful economic interest-groups, but by the fact that the long post-war boom fell into a structural crisis, as Fordism ran up against its limits. The exhaustion of organisational and administrative reserves of productivity of standardised mass-production brought about increased pressure on rates of profit, while at the same time labour had successfully struggled for increases in wages and social services, and the capital-costs of financing general public infrastructure continued to rise.
Then, when the OPEC countries raised oil-prices gently – which caused the costs of the excessive exploitation of fossil energy-reserves to rocket – the self-supporting thrust of post-war growth came to an end. There was no increased investment in the means of production, factories, buildings etc., because these could no longer produce sufficient profit; a significant proportion of capital was thus 'set free' and found no profitable investment.
But since capital is by its nature self-valorising value – that is, since the only purpose to capitalist production consists in making more money out of money (which is the source of capitalism's compulsion to perpetual quantitative growth without regard for human needs or natural limits) – such a stagnation in the process of valorisation is synonymous with a crisis. More precisely: with a crisis of over-accumulation, or, to put it in the vocabulary of contemporary macro-economics, with a crisis of over-investment. A proportion of capital becomes excessive (measured according to its own abstract rationality as an end in itself) and is therefore threatened by devalorisation. And when this devalorisation happens, it is not constrained to the collapse of individual companies and banks (as is the case in the normal functioning of capitalism) but reverberates, mediated through and strengthened by negative multiplying effects – through the entire economy and society.
Precisely this danger threatened in the mid-1970s – as was predicted by many (not only left-wing) economists.3 But why didn't it happen? Why did the great world-economic crisis fail to break through? One fundamental reason was that a substantial proportion of the superfluous capital that could no longer be invested in the real economy was diverted into the financial markets, where it was then invested primarily in government bonds, but also increasingly in stock- and security-speculation. This diversion into the financial sphere, seen on its own, is a perfectly normal stage of progression of every crisis of the valorisation of capital. Marx had already analysed it in relation to the crisis of 1857, and coined for it the term 'fictitious capital'.
Credit and speculation capital is fictitious because it only apparently serves as capital. For it yields high interest-rates and speculative gains it for its owner in the relative absence of real valorisation takes place, which always presupposes that abstract labour is spent on the production of commodities and services and that a proportion of it is siphoned off as surplus value. But the 'returns' that fictitious capital 'yields' stem from other sources, whether taxes and new credits (in the case of exponentially growing national debt), bets on the future (in the case of speculative gains) or the selling off of social substance (in the case of privatisation).
This is most obvious in the case of increasing national debt: the state borrows money in order to flush it straight back into circulation. From the point of view of the creditor, this money appears as capital, because it 'yields' interest. But it fact it is long-since spent, and therefore exists as 'value' only in the form of receipts (government bonds). But personal loans and mortgages function according to the same principle: the debtor borrows money to to buy houses, cars or other consumer goods; although the money is long-since spent, it appears to the creditor as capital that has been profitably invested. Admittedly, from the creditors' perspective, this relationship doesn't matter at all. Credit and speculation seem to them no less 'real' opportunities for investment, as long as the sources of money continue to gush.
However, the growth of fictitious capital not only provides an alternative choice for investors, but also constitutes, when viewed on the macroeconomic level, a deferral of the outbreak of crisis. For the turn to the financial markets prevents the devalorisation of superfluous capital only temporarily, and at the same time also creates increased purchasing power through various mechanisms, which in turn increases the demand for commodities and services and thus keeps the real economy running, or even stimulates it. In the case of increases in public borrowing this mechanism functions immediately, and has become a central instrument of economic policy.
Regardless of whether the state spends the borrowed money on building roads, buying fighter planes or social transfer payments, it always flows straight back into consumer circulation and stimulates further economic activity. As the latest property boom in the USA has shown, personal loans and mortgages carry out precisely the same macroeconomic function, the only difference being that the debtors are private individuals. To a certain degree, profits from the financial market also flow back into the real economy, whether through money spent on fixtures and furnishings for banks, funds and other institutional players of the financial markets (from the fleet of company cars, via the computers, to the prestigious office-buildings), or through the fact that employees and investors finance their own consumption through yields from interest and speculation. Fictitious capital is to this extent anything but a dead weight that burdens the real economy and prevents it from functioning properly. Quite the opposite: it enables the temporary prolongation of capitalist business as usual.
In no great capitalist crisis so far has this means of deferring the crisis lasted long. A short period of speculative overheating has been followed by a large crash, in which the built-up potential for crisis discharged with huge impact, destroying in a single stroke a substantial proportion of economic and social structures. The historical particularity of the crises of Fordism consists in the fact that such a huge devalorisation of the speculation and credit amassed in the aftermath of the crisis has not yet taken place. But this should by no means be taken to mean that the principles of the logic of capitalist valorisation and function have been disproved, as has repeatedly been asserted.
Only the immensely long duration of the deferral is historically unique: mediated through the mechanisms of fictitious capital, it is structurally no different from previous crises, and must therefore sooner or later discharge into a surge of devalorisation. To this long duration corresponds the correspondingly gigantic inflation of the speculation and credit bubbles. If it is the case that today – as it says in almost every newspaper – about 97% of all international transactions serve purely speculative ends, this is no evidence of economic 'malfunction' or even for the 'greed' of insatiable speculators, but simply shows the extent to which the deferral of the crisis has grown, and thus also the huge potential for crisis that has been built up.
The particularities of the long deferral of the crisis
Seen politically, it was the growing liberalisation of the transnational financial markets and the final delinking of money from gold (the US dollar leaving the gold standard in 1971 was the beginning of the end of the system of regulated exchange-rates), that made it possible to prolong the deferral of the crisis for such a long time in the first place. For it was only in this way that the global money supply could grow to an extent unimaginable in previous crises, during which the gold standard and nationally regulated financial markets set limits to monetary expansion. The decision to tear down these limits was not a wilful political act that can be attributed to the influence of particular powerful interest groups.4 Rather, it was a consequence of economic development in the 1950s and 60s, which dug away little by little at the foundations of the Bretton Woods system.As the undisputed economic supremacy of the USA withered away to the extent that it could only cover the costs of its political and military position of global power through increased public borrowing (the costs of the Vietnam war played a major part in this), fixed exchange-rates and the pegging of western currencies to US gold-reserves could no longer be maintained. This was the point at which the prerequisites for a huge increase in the money supply – with the active participation of governments, central banks and the IMF – were first present. Since the 1970s – and above all since the 1980s – huge amounts of unsecured liquidity have been pumped into the markets, either through the direct route of public borrowing or through 'cheap money' policies, which were always introduced whenever the markets looked a little shaky. The USA played a central role in this process, for its global power enabled it to borrow in its own currency without having to fear devaluation, since the dollar functioned as a de facto world currency (a role that is currently being questioned). But the fiscal and monetary policies of other western states have also made a significant contribution to the permanent inflation of the global bubble of fictitious capital in order to defer the onset of the crisis ever further.
There is a further important historical particularity to the long cycle of finance-capital since the 1970s. Namely, that it not only represented a deferral of the crisis of Fordism, but it also interfered with the mighty surge in productive capacity that was the third industrial revolution. Under the conditions of a 'normal' crisis of overaccumulation, a fundamental transformation of production towards the foundations of information and communication technologies would only have been able to establish itself, if at all, after a period of deep global depression in which the post-war economic structures had been reduced to rubble and ashes. However, the long postponement of the crisis by means of fictitious capital made it possible to restrict this destructive work primarily to the global south and the former eastern bloc.
The structures of Fordism were also ruined in western cities, but this was part of a longer process, during the course of which pressure on the conditions of labour and on social systems was steadily growing, and the structures of production were undergoing fundamental transformation. This process unfolded differently in each country depending on its position on the global market and in competition, but the trend was the same everywhere: industrial sectors were radically rationalised with the help of micro-electronic applications, and slowly reduced to their hyper-productive cores, while each aspect of production that could not (yet) be made economically profitable by automation was outsourced to countries or sectors in which wages are lower.
Since the so-called service sector at once both gained increasing significance and absorbed a substantial proportion of the labour-power that was no longer required by industry, it was possible to interpret the situation, if superficially, as if capitalism had simply gone through a further structural change, a process which could essentially be characterised by the replacement of the dominant industrial sector with that of services and 'knowledge-production', and at the same time the globalisation of economic relations. Correspondingly, most observers and economic experts where united in the view that capitalism, at least in the urban west, had managed to overcome the crisis of the 1970s and 80s (keyword: 'crisis of labour society'), if at the price of increased precarisation of the conditions of life and labour for large sections of the population, which, depending on the commentator's political position, were either treated as unavoidable or denounced as the unnecessary result of neoliberal policies. But from all positions the diagnosis of a fundamental process of crisis seemed absurd and fallacious. 'Just look how vivacious capitalism is' was heard from all quarters – whether rejoicing, critical or resigned – with reference to the gushing profits even during the last few years.
The current crisis of the financial market shows relatively unmistakably that this assessment was fundamentally false. And not because speculation destroys the real, sustainable economic structure (just as in the current controversy the 'locusts' are always blamed), but because the structure that has emerged in the last twenty-five to thirty years was never the cause of a self-supporting boom of capital accumulation. Quite the reverse: it was only viable at all because it was (and still is) continually serviced by the flows of fictitious capital. A self-supporting boom would presuppose that whenever growth were checked, more labour-power would be exploited in the production of commodities up to the required level, for this is the only way to ensure that the amount of added value can increase and the cycle 'money – commodities – more money' perpetually be preserved. From the perspective of demand, this would mean that at at every stage of development, enough labour-income would have to be generated to sell the commodities produced during the previous stage.
Precisely this condition is absent under the conditions of the third industrial revolution. The rationalisation enabled by new information and communication technologies is ploughing up all sectors of the economy with such immense speed that more labour-power is always being rendered superfluous than can be put to use by the ensuing growth. This means that the process of valorisation not only has to cut away at the demand on which it depends in order to liquidate the produced value on the market, but also, more fundamentally, that it permanently undermines its very own foundations.5 To this extent the micro-electronic revolution in production is a sort of permanent crisis of over-accumulation: that is, it always produces an excess of capital that can no longer be valorised, which must in turn be diverted into the sphere of fictitious capital, and thus constitutes an essential contribution to the exponential growth of the financial bubble.
Crisis? What crisis?
Against this diagnosis it is often claimed that in the last decades millions of new jobs have been created in countries that were previously peripheral to the world economy, particularly in East and Southeast Asia, and that the basis for the production of value has therefore grown rather than shrunk. But this argument ignores two fundamental factors. Firstly, the great majority of industrial labour in the relevant countries is carried out at a very low level of productivity and thus produces very small amounts of value, measured against the standard of the automated and completely rationalised factories on the global market. For from the standpoint of value-production, it is not so much that the level of value produced is defined by the mere number of hours worked as that the amount of value of a commodity is defined by the relevant level of social productivity.6 And since in the core sectors of global production this level has been rising consistently, the value of the unproductive labour in the outsourced elements of production falls just as consistently.This means that outsourcing is only economically profitable as long as yet lower wages and worse working conditions can always be found.7 And this in turn is the reason why the current drive towards rationalisation has not led to general reductions in labour-time and a good life for all (indeed, it has not even created the opportunity for a relative improvement of living conditions within capitalist society), but rather to large-scale social impoverishment.
But secondly, the boom in China, India and the other 'emerging markets' is by no means sustainable, but is itself thoroughly dependent on the global generation of money by credit and speculation. It is widely recognised that the entire economic structure of these countries is oriented towards mass export, primarily to the USA and EU, which in turn largely finance their imports with income from finance and credit capital. Paradigmatic for such relationships is the Pacific deficit-circulation between the USA and East Asia, which since the Reagan-administration has become the central motor driving world economic activity. Its functional mechanism is fundamentally very simple: a permanently growing trade deficit is covered by (also permanently growing) imports of finance capital, which, partly via the direct route of credit-financed government expenditure ('twin deficit'), partly via the detour that is the private finance system, is flushed back into consumer circulation. But since most of the money flows from the Asian countries (currently primarily Japan, but increasingly China), which invest their sales revenue in the US finance sector or build up their currency reserves in US dollars, they in fact finance these exports themselves.
In the Reagan-era it was burgeoning public borrowing that functioned as a motor for consumption, while share and bond speculation became more significant later – during the so-called 'new economy' many private investors financed a proportion of their consumption from the huge price-rises on the 'new market'. And in the last few years the emphasis has finally moved to property speculation.
However, this cycle can only function as long as the US dollar enjoys the necessary trust to sustain the flow of fresh finance capital necessary to cover the permanent deficit. It is a mark of the current financial crises that this trust is to a great extent crumbling (a sign for this is the falling dollar). Should the US government and the Federal Reserve fail to reverse this trend, the pacific deficit-cycle will come to a halt, which would have approximately the same effect on the world economy as the likely Gulf Stream shutdown on the global climate. It is nothing other than lazy anti-Americanism when more and more voices in Europe respond to the current prognosis by condemning the US with moral outrage for having 'lived at the expense of the rest of the world' by financing their 'unproductive consumption' on credit,8 and also now for tipping the world economy into crisis. This reproduces once more the ideological split between 'parasitic' credit capital and honest productive capital – anti-American ideological models are in Europe always at the very least an indication of a dangerous proximity to antisemitic constructs – and what's more, it turns the actual relationship right on its head.
For on the one hand, European countries have profited to a great extent from credit-financed demand from the US: German industry in particular would have been in a sorry state for a long time were it not for the huge volume of exports across the Atlantic. On the other hand, when compared to GDP, national debt in Europe is on a par with that of the US, and it is not as if speculation is unheard of: in recent years there has been a huge speculative property boom, particularly in southern Europe, which is also collapsing right now. And in any case, the global capitalist economy as a whole is surviving on a drip of fictitious capital because it can no longer be sustained by the real economy.
It is thus completely absurd for commentators in every newspaper from left to right to accuse the US central bank of having stimulated property speculation with its policy of low interest rates, and therefore of responsibility for the current financial crisis. The Fed's actions after the crash of the New Economy were simply to prevent a landslide on the financial markets. The Fed also deferred the onset of the crisis by seven or eight years and then enabled the much talked-of upturn, which all politicians claim as their own. Anyone who insists on using moral categories in this situation ought to be thankful to the Fed and the US government for allowing the world economy such an orderly pause for breath through their expansive monetary policy. But thankfulness is here no more helpful than moral condemnation. It is much more important to understand that the causes of the crisis of the financial markets lie not in speculation, but in a much more fundamental structural crisis of capitalist reproduction. This insight has far-reaching consequences for social conflict in the near future.
Further deferral of the crisis…
It is not possible to offer a definite prognosis as to the future course of the crisis. At the moment it is not clear if the united forces of the central banks and governments would be able once again to defer the megacrash of the financial markets and its destructive consequences for the entire world. Should they succeed, it would only be through the inflation of another financial bubble. That would be in open mockery of those who see the solution to the problem in regulation of the financial markets. For this demand has been taken up from all sides, including by former neoliberal hardliners, who argue along the lines of 'what do I care about what I said yesterday?' But in practice, the state's intervention will result in the exact opposite: it will essentially act to limit the direct damages that result from the collapse of the property bubble.It is significant that even the social-democrat populist Oskar Lafontaine is arguing that the state should prevent failing banks from going under, because he knows that a collapse of the banking system would have disastrous consequences for society as a whole.9 Of course, he conscientiously tacks on the demand for better control of the banks and financial markets. But that is a mere rhetorical flourish, for bad credit given now can under current conditions only be repaid – if at all – through future gains on the financial markets. It makes no difference whether the players of the market are states or individuals, for both are equally subject to the requirement to invest 'their' capital profitably, and under conditions of over-accumulation that means investing only in the spheres of credit and speculation, because there is only very limited scope for the valorisation of capital within the real economy.10 It doesn't matter whether we recognise this fact or not: the point is proved in practice. It is for this reason that governments and central banks have no choice beyond the reopening of the monetary floodgates. The US government and the Fed are already steering this course.11
Of course, political action is always restricted by the fact that it cannot call into question the functional logic of capitalism itself. Politics is by its nature restricted to the administration of public affairs within this logic. However, the available political room for manoeuvre changes over the course of history. It is shaped and restricted by the limits of what is possible at any historically specific moment, which itself depend on the blind dynamic of the development of capitalism. Within these limits, political decisions and courses are not determined, but result from the interplay of different factors, such as relationships of social and international power, or relative strength in competition on the global market; but the frame defined by the limits is beyond the reach of politics. This is just as true for Fordism, today so often romanticised. Despite the relatively high potential for regulation during this period, politics could no more be said to have created the Fordist boom as such, than it could have prevented its end.
However, it was able to influence the boom's internal course to a certain degree, and to use the scope available for distribution to build up an extensive social infrastructure. The period of crisis-capitalist globalisation presents a mirror-image of this. Politics cannot substantively transform fictitious capital into flesh, because the constant inflation of the credit- and speculation-bubble is a precondition for the precarious deferral of the crisis, and thus determines the limits of political action. Politics is to this extent compelled to do everything to guarantee the existence of this precondition for as long as possible, and beyond monetary measures, its recources include increased predation of 'public goods', which are thrown into the fire of private valorisation in order to keep the capitalist machine running.12
But putting a stop to the crisis-dynamic of capitalism itself would be beyond the possible reach of politics, whose interventions instead contribute to the constant reproduction at an ever higher level of the contradictions that lie at the heart of the crisis-process. While the amount of fictitious capital that must be protected from devalorisation grows exponentially (as a glance at the growth of of the financial markets shows), the pressure on society and the large majority of the population, forced to sell themselves under ever more precarious conditions, grows with every stage of the deferral of the crisis. Correspondingly, the social costs of further postponement of the great crash will be considerable. On the one hand, we can count on a proper economic slump, which in contrast to the current 'upturn' will certainly hit rock bottom.
On the other hand, increases in the money supply will probably lead to further acceleration of inflation, and with it to further decreases in the already shrinking mass purchasing-power. And finally, the next wave of speculation will likely be in raw materials, food and agrofuels, and will therefore have catastrophic consequences for large sections of the global population. The horrendous rises in food-prices in the last two years can to a great extent be attributed to the fact that more and more institutional investors have placed their capital in commodity futures. If this trend continues, the unavoidable result will be a price-explosion, increasing world hunger many times over.
And even then the increased volume of fictitious capital would not be the direct cause of the catastrophe, but would rather function (as is already is in the current wave of privatisation) as the drive-belt and transmission of the crisis-process and of its inherent tendency toward exclusion and precarisation. There is therefore a considerable danger that the resentment that this causes will be directed only against the imagined enemy of 'greedy' finance capital, onto whom the blame for the entire misery will be shifted. It remains all the more important to take a stance against this inverted 'critique of capitalism' that leaves a way open for antisemitism. But this presupposes not only the necessary ideology-critique, but also a well-grounded analysis of the crisis that removes the ground from beneath the inverted perception of the capitalist cause-and-effect relationships. This is not to claim that speculation and the financial markets should be placed beyond critique, but to argue that they must always be analysed as aspects of a fundamental crisis of capitalism – and it is this process as a whole that will result in the wide-ranging destruction of the foundations of social and natural life.
This critique must also be directed against the partly nostalgic, partly populist plans for a return to a Keynesian politics of growth and regulation. Even the proponents of these plans know that under the current conditions there is simply no scope for their implementation. Evidence for this is provided whenever 'left-wing' parties come to power, and then carry out quite the opposite of their promised programme; this is no less true for the SPD-Left Party coalition in the Berlin city government as it is for the former 'centre-left coalition' in Italy or broadly speaking for the Lula-government in Brazil. Insanely enough, it is not the case that the electorate is simply credulous and is 'deceived', but rather, that in the absence of any better prospects it wants to believe that a return to the Keynesian post-war social state is still possible, even though it is at another level thoroughly aware that this cannot happen.
That is at the heart of the schizophrenic mood in Germany where there is both broad support for classical social-democratic demands (universal minimum wage, no rail-privatisation etc.) and at the same time high levels of affection for the Merkel-government. What is problematic about this mood is that in its oscillation between unrealisable wishes and uncritical acceptance of the structural logic of capitalism it is deeply susceptible to the danger of identifying scapegoats, whether hedge-funds, the US government, large corporations or – in its final delusional ramification – 'the Jews'.
It might sound paradoxical, but the point at which the last thing one wants to give oneself up to 'realpolitik' and its credo of practical constraint is precisely when clearly naming the limits of politics in the current period of crisis becomes more necessary than ever. Not in order to acknowledge the validity of these limits, but as a necessary process of orientation for social movements and the parts of the trade union movement that are opposed to the systematic predation of the social state, the progressive intrusion of monetary value into all aspects of life, increasing precarisation and the state-control and -repression that are associated with them.
If they commit themselves to illusory political perspectives and immerse themselves in party politics, the result is nothing other than their neutralisation.13 If, on the other hand, they concentrate on uniting their struggles across the divisions between between special-interest campaigns, isolated living-conditions and fragmented identities, they could succeed in reversing the trend away from solidarity that has been driven forward by the pressure of the crisis, and in forming an oppositional social power that stands opposed to the neoliberal politics of demolition and exclusion, and that at the same time brings the defeat of the logic of capital back into the realm of the possible.
… or global economic crisis?
Should attempts once more to defer the crisis fail, there threatens a global economic crisis of formidable proportion, in which the crisis-potential that has been built up over thirty years will be released. The immediate consequences will be the collapse of a great many businesses and banks, probably along with a huge rise in inflation. It doesn't take much to imagine the destructive consequences of such stagflation on public finances, social services and the living conditions of the great majority of the population. It is highly likely that under these conditions the ideology of a national-populist crisis-administration – as has been advocated for a long time, and not only from the right wing of the political spectrum – will grow in popularity. When the journalist Jürgen Elsässer (currently at Neues Deutschland, the newspaper of the former ruling party of the DDR) calls for a 'national popular front' against globalised capital and particularly against finance capital (that he locates, quelle surprise, predominantly in the USA), it still sounds perhaps somewhat overexcited.But it represents a tendency that amounts to an aggressive, nationalist shutting-off from the outside, and authoritarian internal discipline in conjunction with the mobilisation of antisemitic hatred. Given the complex relationships of transnational economic interdependence, it is hardly possible to imagine a return to the largely isolated nation-state, even merely in administration of the crisis. More likely is the disintegration of the world economy into continental blocs, a scenario that is already being played through in think tanks and in the corridors of power. The visible fall of the US dollar and its ensuing loss of its function as a global country could be a strong driving mechanism in this direction.14
Such a possible scenario does not present any hope for a solution to the crisis, in any genuine sense of the world, but only for a form of administration of the state of emergency. That is to say, any sudden instance of devalorisation would in no way have the character of a 'purifying crisis' in which the foundations for a new self-supporting surge of accumulation could be created through the sweeping away of surplus capacity and bad credit. For this would not eliminate the actual cause of the crisis, the displacement of living labour power through the relocation of productive capacity from immediate production onto the level of the general social complex of knowledge, and the ensuing destabilisation of the production of value. Furthermore, all production would have to take place at the level of productivity attained through the new information and communication technologies, or be measured against this level, while the race for increased productivity would continue.
At lower levels of value-production, a state of permanent over-accumulation would be immediately re-established, and with it the compulsion for the renewed pumping up of fictitious capital. The contradictions of the current crisis-process would be reproduced under substantially worse economic and social conditions. The decisive question will then be whether a transnational movement of emancipation can succeed in developing out of the resistance against the gravity of the crisis-process, a movement that can take an understanding of the social situation beyond the capitalist logic of valorisation towards a practical programme.
