Economics

An insurance society for the ruling class

An editorial in the Financial Times (21 January) summed up well the Government's new plan for the collapsed bank Northern Rock. "The plan is this. Northern Rock will issue billions of pounds in new bonds... and repay its debt to the Bank of England. Private investors will [take over the bank]. And to make it work the bonds - all £30 billion or so - will carry a government guarantee... "The package amounts to a subsidy [from the Government to the Northern Rock shareholders and its putative buyers] and it may be worth billions of pounds... "[But] the political attractions are obvious. The...

Andrew Glyn, economist of the left. June 30 1942 – December 22 2007

On December 22 2007, Andrew Glyn, left wing economist and prolific author of books and articles about capitalism, died of a brain tumour. When Andrew began teaching economics at Oxford University in 1969, the capitalist world was experiencing major political turmoil. Memories of the US civil rights movement were fresh, France’s political explosion of the previous May still echoed around Europe and workers in many countries were engaged in the most active struggles for decades. In this atmosphere large numbers of workers, students and teachers were radicalised and Andrew, already something of a...

Is capital in a big expansion or a long downturn? Will the current crisis snowball?

I attended two sessions discussing the current credit crisis at the conference on 9-11 November sponsored by Historical Materialism magazine. The two sessions offered very different views on the crisis, with disappointingly little interaction. No speaker in either session was confident enough to give a definite yes or no on whether the credit crisis will snowball into a sizeable crisis of trade and production. Robert Brenner, in the second session, ventured a prediction that it will snowball, but made it clear that was only a best guess. The big difference between the two sessions was in their...

Marx's "Capital" on wage-labour and profit: PowerPoint presentation

Here is a PowerPoint presentation on commodities, value, wage-labour, profit, and capital . It is designed as back-up for talking through the issues, rather than as a stand-alone. You may find it useful when reviewing your notes from a study group on these issues, or when leading a study group.

When “aid” means evictions

Even with Labour and the Conservatives outdoing each other to be the party of big business and wealth, some poor people are still popular at Westminster — that is poor people in other countries. Laments for the scale of global poverty and a stern faced insistence on the need to do something about it are becoming the favoured recourse of every politician, most obviously Gordon Brown. Soundbites like “when conscience is joined to conscience, moral force to moral force, think how much our power to do good can achieve” (Brown on his recent trip to America) are lapped up by the press as testimony...

Northern Rock and the case for nationalising the City

The Liberal Democrats are calling on the Government to nationalise the failed bank Northern Rock, and denouncing New Labour from being held back from this course by "ideological preoccupations". Such are the weird convolutions produced in British politics by the Blair-Brown counter-revolution in the Labour Party. Lib Dem economic spokesperson Vincent Cable, a man solidly on the pale-Thatcherite right wing of the Lib Dems, denounces the Labour Party leadership for having "ideological preoccupations" against public ownership (Guardian, 20 November 2007)! Cable, of course, only wants "the...

World credit spiral hits nemesis

“You can expect”, writes US economist Nouriel Roubini, “that the ongoing credit crunch will get much worse in the year ahead and its fallout will spread from the US to Europe and throughout Asia and the globe. "Trillions of dollars of securitised assets that were sliced and diced in the long food chain of securitisation are now at some risk. The first crisis of financial globalisation and securitisation is only at its beginning stage”. At one end — the starting end of this crisis — two million poorer US households are likely to lose their homes in the coming months because, with interest rates...

The Grundrisse on exploitation

Where do profits come from? How can wage-labour reasonably be described as wage-slavery? If a worker makes a free contract, as an individual equal before the law, with an employer, isn’t that a fair day’s wage for a fair day’s work? Shouldn’t the word “exploitation” be reserved for exceptional cases where workers are exceptionally at a disadvantage in the wage-bargain, rather being used (as Marxists use it) for all wage-labour? The Grundrisse offers a faster-burning and more vivid first draft of the answers to these questions which Marx develops in Capital. In Capital, Marx is laconic and...

Rich and poor: the gap widens

“Britain remains a nation dominated by class division”, reported the Guardian on 20 October. The division is dramatised by David Cameron’s Tory front bench, which includes no fewer than 15 men schooled at Eton. The Lib Dem leadership contest is being fought out by two men schooled at Westminster, a school almost as posh as Eton. Thirty-two per cent of current MPs went to fee-paying schools, which educate just 7% of the population. 43% went to one of the 13 poshest universities and over a quarter (27%) to Oxford or Cambridge. The Tories are what they always have been. New Labour is becoming...

A five year plan?

Alistair Darling’s pre-Budget statement on 9 October promised real wage cuts for public sector workers through to 2011, as well as choking back health and education spending and decreeing extra job cuts in the civil service, especially the Department of Work and Pensions. The statement decrees “public sector pay settlements consistent with the achievement of the Government’s inflation target of 2 per cent” right through to the financial year 2010-11. Actually, the Retail Price Index currently shows inflation at 4.1%. It has been above 4% pretty much all this year — 4.8% at one point — and is...

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