The Protracted Crisis of Capitalism

By Prabhat Patnaik

Republished from People’s Democracy.

THERE is a commonly-held view that the current crisis in capitalism, which has resulted in a massive output contraction and increase in unemployment, is because of the pandemic; and that once the pandemic gets over, things will go back to “normal”.

This view is entirely erroneous for two reasons. The first which has been often discussed in this column, has to do with the fact that even before the pandemic the world economy was slowing down. In fact ever since the financial crisis of 2008 following the collapse of the housing bubble, the real economy of the world had never fully recovered. Small recoveries were followed quickly by collapses; and the low unemployment rates in the United States that had prompted Donald Trump’s triumphalism, were to a very large extent explicable by the reduced work participation rate after 2008. In fact if we assume the same work participation rate in 2020(just before the pandemic), as had prevailed on the eve of the financial crisis, then the unemployment rate in the U.S. was as high as 8 per cent as compared to the less than 4 per cent mentioned in official figures.

This slowing down in turn has been a result of the operation of neoliberal capitalism which has massively increased the share of economic surplus in output, both within countries and also at the world level, by keeping the vector of real wage-rates unchanged, even as the vector of labour productivities has increased; and this increase in the share of surplus, or this shift from wages to surplus, has lowered the level of aggregate demand for consumption goods, and hence of overall aggregate demand, as workers spend more on consumption out of a unit of income than the surplus earners.

The pandemic has occurred in this context, so that even after it gets over, the world will still be stuck with the crisis of over-production which had already engulfed it well before the pandemic. To get out of this crisis it is necessary to use State expenditure, provided such expenditure is financed by either taxes on capitalists or by a fiscal deficit ; State expenditure financed by taxes on workers will not help, since workers consume the bulk of their incomes anyway, so that State demand only substitutes workers’ demand without adding to aggregate demand.

But neither fiscal deficits nor taxes on capitalists are liked by finance capital, so that State expenditure as an anti-crisis measure is ruled out. This means that, even after the pandemic is over,not only will the crisis continue, but it will do so without any counteracting measures, at least as long as neoliberal capitalism lasts. This crisis therefore marks a dead-end for neoliberal capitalism.

There is however a second reason why even after the pandemic gets over, capitalism will still remain engulfed in a crisis; and this has to do with the fact that even if the demand for consumer goods recovers to the level where it had been before the pandemic, investment goods production will still remain below what it had been, and this very fact will also ensure that even the consumer good output does not get back to the level where it had been before the pandemic. This is what happens when an economy receives a major shock, of the kind that the pandemic represents for the world economy.

An example will make the point clear. Suppose before the pandemic the economy was growing at 2 per cent per annum. Then capitalists, anticipating a 2 per cent rate of growth, would have been adding to their capital stock also at 2 per cent. If the capital stock was 500, output was 100, then investment would have been 10, and consumption would have been 90. Let the share of post-tax profits and post-tax wage-bill in total private post-tax incomes be 50:50; and let all wages and 75 per cent of profits be consumed. If government consumption (assuming a balanced budget for simplicity) happens to be 20, then this 90 of consumption would have been divided as 20 by government, 30 by capitalists and 40 by workers.

Now, suppose, for argument’s sake, that after the pandemic, consumption recovers to 90. All of it can be produced by the existing capital stock requiring no additional investment. Moreover, there is no reason why the capitalists should expect output to grow at 2 per cent next year; so they would not add 10 to capital stock as they had done before the pandemic. Let us assume that they add only 5 to capital stock, and wait to see what happens before deciding to add any further to capital stock.

Two things will happen in such a case. First, in the capital goods sector, output will be only half of what it had been before the pandemic; likewise capacity utilisation in the capital goods sector will be only half of what it had been before the pandemic. Second, even the consumption demand of 90 cannot be sustained. Assuming the same ratios as above, an investment of 5, which must equal private savings, will generate a total consumption demand of only 55 (given by 20 of government+15 of capitalists out of total post-tax profits of 20 + 20 of workers). Total output will be only 60, equalling consumption of 55 and investment of 5.

The 90 of consumption therefore, which we assumed the world economy to reach, for argument’s sake, will not even materialise. The consumption goods sector’s capacity utilisation will be 61 per cent of what it had been before the pandemic (55 divided by 90). This will be higher than the ratio of capacity utilisation in the investment goods sector compared to what it had been before the pandemic (in fact it will now be only 50 per cent of what it had been earlier).

Any severe external shock to the capitalist system has this effect, namely that investment recovers only after a long time; and precisely for that reason even the recovery of consumption, though less delayed than the recovery of investment, also takes a fairly long time.

In other words, even if there had been no crisis of over-production engulfing world capitalism before the pandemic, the sheer external shock represented by the pandemic would have kept the system mired in crisis for quite a long time. The existence of an over-production crisis predating the pandemic only makes matters worse.

This is exactly what had happened in the U.S. in the recovery from the Great Depression of the 1930s. The consumption goods sector had recovered relatively faster than the investment goods sector, as a result of Roosevelt’s New Deal which had enlarged government spending. The recovery of the investment goods sector occurred only when there was an increase in armament expenditure in preparation for the war, which is why it is said that the recovery from the Great Depression was made possible by the war.

But the New Deal had meant larger government spending which is why at least the consumption goods sector had recovered somewhat, even before the war. Globalised finance capital today does not even allow larger government spending within any economy, either by taxing capitalists or by enlarging the fiscal deficit, the only two ways that such spending can increase aggregate demand. Therefore even the depression in the consumption goods sector will last much longer that in the 1930s, so that, altogether, world capitalism will remain sunk in a protracted crisis for a very long time.

In an economy like India where the government obeys the dictates of finance capital quite slavishly, the prospects of recovery are even bleaker. None of the measures adopted by the government to revive the economy addresses the issue of demand, because the government does not understand that the crisis is because of insufficient aggregate demand. In fact, the government measures are such that they will only aggravate the deficiency of aggregate demand, thereby worsening the crisis rather than alleviating it. As the crisis gets aggravated, however, the government will resort even more strongly to repression against the working people, and intensify even further its communal agenda.

The Internationalist Lenin: Self-Determination and Anti-Colonialism

By Vijay Prashad

Republished from Monthly Review.

In 1913, Lenin published an article in Pravda with a curious title, ‘Backward Europe and Advanced Asia’.(1) The opening of the article accepts the paradoxical nature of the title, for it is Europe–after all–that has advanced it forces of production and it is Asia that has had its forces of production stifled. The character of advancement and backwardness for Lenin does not only rest on the question of technological and economic development; it rests, essentially, on the nature of the mass struggle.

In Europe, Lenin wrote, the bourgeoisie was exhausted. It no longer had any of the revolutionary capacity with which it once fought off the feudal order; although even here, the bourgeoisie was pushed along reluctantly by the rising of the masses–as in the French Revolution of 1789–and it was the bourgeoisie that betrayed the mass struggle and opted for the return of authoritarian power as long as its class interests were upheld. By 1913, the European bourgeoisie had been corrupted by the gains of imperialism; the rule of the European bourgeoisie had to be overthrown by the workers.

In Asia, meanwhile, Lenin identified the dynamism of the national liberation movements. ‘Everywhere in Asia’, he wrote, ‘a mighty democratic movement is growing, spreading, and gaining in strength…Hundreds of millions of people are awakening to life, light, and freedom’. Until this period, Lenin had focused his attention on the revolutionary developments in Russia, with a detailed study of agrarian conditions and capitalism in his country and with debates over the nature of organisation in the revolutionary camp. The breakthroughs in 1911 that took place in China, Iran, and Mexico with their variegated and complex revolutionary processes, nonetheless struck him. In 1912, Lenin would write on numerous occasions of the peoples of Asia–such as Persia and Mongolia–who ‘are waging a revolutionary struggle for freedom’, and he would push his party to condemn Tsarist imperialist attacks on Persia and the ‘revolutionary struggle of the Chinese people, which is bringing emancipation to Asia and is undermining the rule of the European bourgeoisie’.(2)

Lenin had tracked developed in eastern Asia ever since the Tsarist empire opened hostilities against China by invading Manchuria in 1900 and then against Japan in 1904-05 in Manchuria and Korea. In 1900, Lenin took a strong anti-war position, arguing that even though the Tsar had not declared war in 1900, ‘war is being waged nonetheless’.(3) ‘The autocratic tsarist government’, Lenin wrote, ‘has proved itself to be a government of irresponsible bureaucrats serviley cringing before the capitalist magnates and nobles’; meanwhile, the war resulted in ‘thousands of ruined families, whose breadwinners have been sent to war; an enormous increase in the national debt and the national expenditure; mounting taxation; greater power for the capitalists, the exploiters of the workers; worse conditions for the workers; still greater mortality among the peasantry; famine in Siberia’. ‘The Chinese people suffer from the same evils as those from which the Russian people suffer’, argued Lenin in an early demonstration of his internationalism.

The Tsarist empire, along with the European imperialists, had developed a ‘counterrevolutionary coalition’, Lenin wrote in 1908 in his reflection on the Balkans, Turkey, and Persia. How should the socialists react to this policy of imperialism? ‘The very essence of proletarian policy at this stage’, he wrote in Proletary, ‘should be to tear the mask from these bourgeois hypocrites and to reveal to the broadest masses of the people the reactionary character of the European governments who, out of fear of the proletarian struggle at home, are playing, and helping others play, the part of gendarme in relation to the revolution in Asia’.(4)
Within Europe, the oppressed nationalities–such as the Polish and the Irish–demonstrated the important spirit of democracy that Lenin had detected from Mexico to China. Unlike many other Marxists–such as Karl Radek and Leon Trotsky–Lenin fully supported the Easter Rising in English-occupied Ireland in 1916. It was in this context that Lenin wrote in July 1916, ‘The dialectics of history are such that small nations, powerless as an independent factor in the struggle against imperialism, play a part as one of the ferments, one of the bacilli, which help the real anti-imperialist force, the socialist proletariat, to make its appearance on the scene.’(5) As he studied these movements with more care, the national liberation struggles no longer were seen as mere ‘bacilli’ and not ‘real’, but these movements were themselves partners in a global struggle. Lenin began to conceptualise a strategic unity between the nationalism of the oppressed and the proletariat in the imperialist states. ‘The social revolution’, he wrote in October 1916, ‘can come only in the form of an epoch in which are combined civil war by the proletariat against the bourgeoisie in the advanced countries and a whole series of democratic and revolutionary movements, including the national liberation movements in the underdeveloped, backward, oppressed nations’.(6)

Lenin’s great advance over Second International Marxism is clarified by the centrality he placed of anti-colonial national liberation, of the struggles of oppressed nationalities by the jackboot of imperialism. For Lenin, the democratic struggles of anti-colonialism were lifted to parity with the proletariat struggles inside the advanced industrial states; it was the international cognate of his theory of the worker-peasant alliance.(7)

In 1914, Lenin published a long series of articles on the theme of ‘national self-determination’ in the journal Prosveshcheniye (Enlightenment).(8) These were his longest statements on the topic, even though Lenin was to return to the idea over the next decade. Like much of Lenin’s work, this essay was not written to elaborate on the idea of national self-determination in itself; Lenin wrote the article to answer a position initially taken by the Rosa Luxemburg in 1908-09. In that article, ‘The National Question and Autonomy’, published in Przeglad Sozialdemokratyczny (Panorama Social Democracy), Luxemburg argued against the right of self-determination for the Polish people.(9) Initially, Stalin responded to Luxemburg (in Prosveshcheniye, March-May 1913), but Stalin’s essay did not directly confront Luxemburg’s theses (he was more content to take on Karl Renner and Otto Bauer).(10) It was left to Lenin, the following year, to offer a full critique of Luxemburg.

Lenin argued that an oppressed nation must be allowed its freedom to secede from an oppressor state. Tsarism and colonialism not only crushed the ability of the people of its peripheral states and its colonial dominions to live full lives, but it also contorted the lives of those who seemed to benefit from colonial rule (including workers at the core of the empire). Secession, for Lenin, was a democratic right. If later, because of economic pressures, the proletariat of an independent state would like to freely unite with the proletariat of their previous colonial state that would be acceptable; their unity would now be premised upon freedom not oppression. Over the course of the next decade, Lenin would develop this argument in a series of short essays. Most of the essays, written in German, were translated into Russian in the 1920s by N. K. Krupskaya and published in the Lenin Miscellany volumes, later in the Collected Works. In 1967, Moscow’s Progress Publishers put these essays into a small book under the title, The Right of Nations to Self-Determination (it is available in volume 20 of Lenin’s Collected Works). Their appearance in a book, then, was not intentional since Lenin had never written a book on the subject. This was a collection of interventions and articles that had the gist of his analysis on the question.(11) It is these interventions, however, that allow us to see the richness of Lenin’s argument about anti-colonialism and self-determination.(12)

Bourgeois Nationalism

The question of self-determination came to the fore because of the social forces unleashed by the 1905 Russian Revolution and because of Tsarist expansion into Manchuria and Korea. Different social groups within the Tsarist Empire began to make their own claims for freedom, which had to be represented in the new political parties that emerged on the partly freed up civil arena. The Russian Social Democratic Labor Party (RSDLP) had to, therefore, address the question of national self-determination frontally: how should the various people within the Tsarist empire struggle for their freedom? Must they remain under the yoke of the State, even as this State would be at some point be free from Tsarism? Luxemburg was specially involved in this debate because of her roots in the Polish Social Democratic movement, which had since the 19th century been involved in questions of freedom for Poland from the tentacles of Tsarist power. In the world of international socialism, it was often the Polish parties that made the strongest application of the idea of the right to self-determination. That was the case in 1896, when it was the Polish Socialist Party that called for the independence of Poland at the International Socialist Congress in London. At that Congress, the delegates passed a resolution in favor of ‘the complete right of all nations to self-determination and expresses its sympathy for the workers of every country now suffering under the yoke of military, national, or other despotism’.(13)

Polish social democrats at their own Congress (1903) and at the Congress of the RSDLP (1906) agitated to sharpen Social Democracy’s view on self-determination. Little seemed to divide the position of Luxemburg from Lenin at this time, except that in the hallways of the meetings the Poles did express their reservations against the idea of a right to self-determination. It was the working-class that had rights, Luxemburg wrote in her 1908 pamphlet, not nations. The nub of Luxemburg’s unease with the theory of the ‘right to self-determination’ is captured in a long quotation from her 1908 pamphlet,

The formula of the ‘right of nations’ is inadequate to justify the position of socialists on the nationality question, not only because it fails to take into account the wide range of historical conditions (place and time) existing in each given case and does not reckon with the general current of the development of global conditions, but also because it ignores completely the fundamental theory of modern socialists – the theory of social classes.

When we speak of the ‘right of nations to self-determination,’ we are using the concept of the ‘nation’ as a homogeneous social and political entity. But actually, such a concept of the ‘nation’ is one of those categories of bourgeois ideology which Marxist theory submitted to a radical re-vision, showing how that misty veil, like the concepts of the ‘freedom of citizens,’ ‘equality before the law,’ etc., conceals in every case a definite historical content.

In a class society, ‘the nation’ as a homogeneous socio-political entity does not exist. Rather, there exist within each nation, classes with antagonistic interests and ‘rights.’ There literally is not one social area, from the coarsest material relationships to the most subtle moral ones, in which the possessing class and the class-conscious proletariat hold the same attitude, and in which they appear as a consolidated ‘national’ entity. In the sphere of economic relations, the bourgeois classes represent the interests of exploitation–the proletariat the interests of work. In the sphere of legal relations, the cornerstone of bourgeois society is private property; the interest of the proletariat demands the emancipation of the propertyless man from the domination of property. In the area of the judiciary, bourgeois society represents class ‘justice,’ the justice of the well fed and the rulers; the proletariat defends the principle of taking into account social influences on the individual, of humaneness. In international relations, the bourgeoisie represent the politics of war and partition, and at the present stage, a system of trade war; the proletariat demands a politics of universal peace and free trade. In the sphere of the social sciences and philosophy, bourgeois schools of thought and the school representing the proletariat stand in diametric opposition to each other.

The possessing classes have their worldview; it is represented by idealism, metaphysics, mysticism, eclecticism; the modern proletariat has its theory–dialectic materialism. Even in the sphere of so-called ‘universal’ conditions–in ethics, views on art, on behavior–the interests, world view, and ideals of the bourgeoisie and those of the enlightened proletariat represent two camps, separated from each other by an abyss. And whenever the formal strivings and the interests of the proletariat and those of the bourgeoisie (as a whole or in its most progressive part) seem identical–for example, in the field of democratic aspirations – there, under the identity of forms and slogans, is hidden the most complete divergence of contents and essential politics.

There can be no talk of a collective and uniform will, of the self-determination of the ‘nation’ in a society formed in such a manner. If we find in the history of modern societies ‘national’ movements, and struggles for ‘national interests,’ these are usually class movements of the ruling strata of the bourgeoisie, which can in any given case represent the interest of the other strata of the population only insofar as under the form of ‘national interests’ it defends progressive forms of historical development, and insofar as the working class has not yet distinguished itself from the mass of the ‘nation’ (led by the bourgeoisie) into an independent, enlightened political class.(14)

For Luxemburg, the idea of the nation is an ideological smokescreen utilised by the bourgeoisie to create horizontal linkages against the vertical hierarchies of social life. It is a useful mechanism to build national economies and national polities that benefit the class rule of the bourgeoisie. That is the reason why the idea of the right to national self-determination had to be defeated.

Lenin did not disagree with the spirit of Luxemburg’s analysis. He agreed with her that the bourgeoisie’s own class power is most efficiently wielded through the national container. ‘The economic basis of [nationalist] movements’, he wrote in his 1914 reply, ‘is the fact that in order to achieve complete victory for commodity production the bourgeoisie must capture the home market, must have politically united territories with a population speaking the same language, and all obstacles to the development of this language and to its consolidation in literature must be removed’.(15) Therefore, Lenin notes, ‘the tendency of every national movement is towards the formation of national states, under which these requirements of modern capitalism are best satisfied. The profoundest economic factors drive towards this goal, and therefore, for the whole of Western Europe, nay, for the entire civilised world, the typical, normal state for the capitalist period is the national state’. Here there is no difference between Lenin and Luxemburg, with both in agreement that national movements are along the grain of capitalist development, and that the advantages of nationalism in the European experience are first garnered by the bourgeoisie.

Equal Rights of Nations and International Solidarity of Workers

If this analysis is all that there is to it, and if it is correct, then Luxemburg’s antipathy to nationalism seems more coherent than Lenin’s ambivalence. But this is not all there is to it, at least as far as Lenin is concerned. Luxemburg’s approach to the idea of nationalism, Lenin suggested, reduced the national question to economics and to economic independence. It was not interested in the political question, in the hunger for freedom among people who had been colonised. Capitalism’s tendency to expansion out of the national container contained the seeds of imperialism; at a certain stage of its economic development, the national bourgeoisie sought the advantages of the nation-state; but as its dynamism pushed outwards, this bourgeoisie’s ambitions mimicked the imperial exertions of its aristocratic ancestors. It is to this end that Lenin made a distinction between the nationalism of the oppressors (the Great Russians and the English) and the nationalism of the oppressed (the Poles and the Irish). This distinction, Lenin wrote in 1915, ‘is the essence of imperialism’.(16) The nationalism of the oppressor, of the Great Russians and the English for example, is always to be fought against. There is nothing in the character of its nationalism that is worthy of support. Its chauvinism leads it to world conquest, a dynamic that not only shatters the well being of the oppressed but also corrupts its own citizenry.

On December 10, 1869, Marx wrote to Engels on the Irish question. ‘The English working class will never accomplish anything before it has got rid of Ireland. The lever must be applied in Ireland’, he wrote. ‘English reaction in England has its roots in the subjugation of Ireland’ (Lenin quotes part of this in his 1914 pamphlet).(17) Drawing from Marx, Lenin wrote in his 1915 essay on self-determination, ‘The freedom of [the English] was cramped and mutilated by the fact that it oppressed another nation. The internationalism of the English proletariat would have remained a hypothetical phrase were it not to demand the separation of Ireland’.(18) Much the same kind of logic applied to Russia, whose Social Democrats were urged by Lenin to demand freedom for its oppressed nations. ‘Carried away by the struggle against nationalism in Poland’, Lenin wrote, ‘Rosa Luxemburg has forgotten the nationalism of the Great Russians, although this nationalism is the most formidable at the present time, it is the nationalism that is less bourgeois and more feudal, and it is the principle obstacle to democracy and to the proletarian struggle’.(19) It had to be confronted. Neither Lenin nor Luxemburg thought otherwise.

Their difference was sharp in the second half of Lenin’s distinction. The Great powers not only annex the economies of their subjects, but they also drain their political power. National self-determination of the oppressed contains both the oppressed bourgeoisie’s plans to suborn the economic to their own ends, but also that of the oppressed proletariat’s hope to fight their bourgeoisie over how to organize their nation. ‘The bourgeois nationalism of every oppressed nation’, Lenin argued, ‘has a general democratic content which is directed against oppression, and it is this content that we support unconditionally, while strictly distinguishing it from the tendency towards national exceptionalism, while fighting against the tendency of the Polish bourgeoisie to oppress the Jews, etc., etc’. Lenin carefully worked out the formula for this unconditional support. If the bourgeoisie of the oppressed nation ‘fights against the oppressing one’, then the Social Democrats would support them wholeheartedly. If, however, ‘the bourgeoisie of the oppressed nation stands for its own bourgeois nationalism’, then the Social Democrats stand opposed to them. ‘We fight against the privileges and violence of the oppressing nation, but we do not condone the strivings for the privileges on the part of the oppressed nation’.(20)

To ‘not condone the strivings’ of the bourgeoisie of the oppressed nations sets the Social Democrats and their class allies the crucial task that separates them from the liberals and their class allies. The Social Democrats both stand against the nationalism of the oppressed nation and against the strivings of the bourgeoisie of the oppressor nation to supplant that of the oppressor nation. Workers in the oppressed nation are not to submit to the rule of the bourgeoisie of the oppressed nation, but to confront it with as much determination as they would fight against the imperial bourgeoisie. The fight for national self-determination must not divide workers in the imperial core and in the imperial periphery. Those in the core must fight against imperial nationalism, and those in the periphery must fight against both imperial nationalism and the nationalism of their bourgeoisie. The latter have a double task, formidable for the complexity of strategy and tactics demanded of them. They are to fight both for ‘the absolutely direct, unequivocal recognition of the full right of all nations to self-determination’, and for ‘the equally unambiguous appeal to the workers for international unity in their class struggle’.(21) In other words, Social Democrats are not invested in nationalism as an end in itself. The final goal is internationalism of the proletariat, but it must go through the nationalism of the oppressed. The twin tasks of Social Democracy are then to fight for ‘the equal rights of nations and international solidarity of the workers’.(22)

A Free Union

What are the practical means by which this nationalism of the oppressed manifests itself? Lenin argued that the oppressed regions should secede from the oppressor nations, or, in other words, they need to win their independence. If Social Democracy does not call for the right to secession, its politics would ‘empty phrase-mongering, sheer hypocrisy’.(23) Plainly, the ‘self-determination of nations means the political separation of these nations from alien national bodies, the formation of an independent national state’. But an independent national state is not the end of the process. It is here that Lenin carved out new terrain in the Marxist theory of nationalities and self-determination (although once more drawing from insights in Marx’s letters to Engels on the Irish question). Marxists and Social Democracy recognize the economic and political advantages of bigger geographical entities: they are both able to command more resources and larger markets, and they are less vulnerable to military conquest. The end goal is to form vibrant and genuine unions of large, non-homogenous areas,

We demand freedom of self-determination, i.e., independence, i.e., freedom of secession for the oppressed nations, not because we have dreamt of splitting up the country economically, or of the ideal of small states, but, on the contrary, because we want large states and the closer unity and even fusion of nations, only on a truly democratic, truly internationalist basis, which is inconceivable without the freedom to secede.(24)

In his March 1916, Nine Theses on Self-Determination, Lenin wrote, ‘a free union is a false phrase without right to secession’.(25) Drawing from Marx on Ireland, Lenin wrote, ‘the demand for the right of secession for the sake of splitting and isolated countries’ is not an end in itself; it is towards a process ‘to create more durable and democratic ties’.(26) Further, Lenin wrote, ‘only in this way could Marx maintain—in contradiction to the apologists of capital who shout that the freedom of small nations to secede is utopian and impracticable and that not only economic but also political concentration is progressive—that this concentration is progressive when it is non-imperialist, and that nations should not be brought together by force, but by a free union of the proletarians of all countries.’(27)

To defend this right to secession, Lenin wrote in August 1915, ‘does in no way mean to encourage the formation of small states, but on the contrary it leads to a freer, more fearless and therefore wider and more universal formation of larger governments and unions of governments–a phenomenon more advantageous for the masses and more in accord with economic development’.(28) Capitalism dynamically grew to encompass the planet, and it sought out larger and larger areas of operation. This is the tendency not only for firms to agglomerate toward monopoly control over markets, but also for states to enlarge through imperial or colonial policies (this is the general dynamic identified by Lenin in his 1916 pamphlet Imperialism). ‘Imperialism means that capital has outgrown the framework of national states’, Lenin wrote in 1915; ‘it means that national oppression has been extended and heightened on a new historical foundation’.(29) Monopoly capital flourished in large, imperial states. Imperialism was rooted in the political economy of the time. It had to be confronted not by morality but by the growth of political movements that undermined its power, in other words, by a combination of proletarian movements and movements of the oppressed nationalities. ‘It follows from this’, Lenin argued, ‘that we must connect the revolutionary struggle for socialism with a revolutionary program on the national question’.

Luxemburg fought for the ‘freedom from national oppression’ and not for ‘the right of self-determination of nations’. For her, national oppression was just another form of oppression, and it should be confronted as just another oppressive force. For Lenin, national oppression played a specific role in the operation of imperialism, and it had to be confronted in a specific way, by encouragement of secession of the oppressed nationalities in order not to petrify their national culture as separate from that of other cultures, but to work toward a proletarian internationalist unity of the future. Lenin’s approach was not a moral approach, therefore, but one that emerged out of his analysis of imperialism and the national movements that had emerged in opposition to it. His endorsement of nationalism was not premised on the assumption that the small states would somehow undermine imperialism; it was understood that democratic states, with the proletariat in each making links with each other, would be able to take advantage of the new economic scale to forge a genuine unity.

Nationalism would not, as Luxemburg acidly put it, mean ‘the right to eat off gold plates’.(30) But it would mean, as Lenin noted, part of a three-point agenda:

• Complete equality for all nations.

• The right of nations to self-determination.

• The amalgamation of the workers of all nations.

This is ‘the national program that Marxism…teaches the workers’.

Karl Radek, the Austrian Marxist, waded into the debate in 1915 to argue that the struggle for national self-determination is ‘illusionary’ (‘Annexations and Social Democracy’, Berner Tagwacht, October 28-29).(31) One of Radek’s objections that rankled Lenin was that a truly class project would abjure democratic political demands that do not threaten capitalism. There are some democratic demands that can be won in the era of capitalism and there are others that must be struggled with even in a socialist society, Lenin argued. ‘We must combine the revolutionary struggle against capitalism with a revolutionary program and revolutionary tactics relative to all democratic demands: a republic, a militia, official elected by the people, equal rights for women, self-determination of nations, etc. While capitalism exists, all these demands are realizable only as an exception, and in an incomplete, distorted form’.(32) Social Democracy has to ‘formulate in a consistently revolutionary manner every one of our democratic demands’ because the proletariat must be ‘educated in the spirit of the most consistent and determined revolutionary democracy’. To contest the right of national self-determination for oppressed nations is to deny them their democratic rights and to undermined revolutionary democracy.

In the USSR and in the Comintern

Lenin’s formulation from 1914-1916 enabled a clear position in practice after the Soviet revolution (1917). Two tasks presented themselves along the grain of national self-determination.

• How should the new Soviet state deal with the question of its own nationalities?

• How should the newly created Communist International (1919) confront the nationalist movements in the colonies?

On January 3, 1918, Lenin, as part of the All-Russia Central Executive Committee drafted the Declaration of Rights of the Working and Exploited People. It was subsequently adopted by the Third All-Russia Congress of Soviets as the 1918 Constitution (the essence remained in the 1924 Constitution). The second article establishes that the Soviet Republic is based ‘on the principle of a free union of free nations, as a federation of Soviet national republics’. The Council of People’s Commissars had already proclaimed the independence of Finland, removed Russian troops from Persia and committed itself to self-determination for Armenia. On paper, this was unassailable. The problem is that counter-revolutionary forces in its border states, the very states that had been promised the right to secession, attacked the new Soviet state. The Soviets hastily sought alliances with these states (Armenia, Azerbaijan and Georgia for instance), in which pro-Bolshevik forces were supported by the Soviets and counterrevolutionaries were defeated. Self-determination of the nation was a formula by which the states were afforded nominal independence if they were not hostile to the Soviets. When Bolsheviks (such as Georgy Pyatakov) in these states did argue for full dissolution into Russia, Lenin called them Great Russians and opposed them. The principle of self-determination was sacrosanct, even when the counter-revolution threatened the new Soviet state (Luxemburg, in her essay on the Russian Revolution identified this weakness, ‘While Lenin and his comrades clearly expected that, as champions of national freedom even to the extent of ‘separation’, they would turn Finland, the Ukraine, Poland, Lithuania, the Baltic countries, the Caucasus, etc., into so many faithful allies of the Russian revolution, we have witnessed the opposite spectacle. One after another, these ‘nations’ used their freshly granted freedom to ally themselves with German imperialism against the Russian revolution as its mortal enemy, and under German protection, to carry the banner of counter-revolution into Russia itself’).(33) In 1922, Stalin wished to curtail the rights of the new border-states through a policy called ‘autonomisation’, namely that these states would dissolve themselves into the USSR by gaining nominal autonomy. Lenin was adamantly opposed to this policy. ‘We consider ourselves, the Ukrainian SSR and others, equal, and enter with them, on an equal basis, into a new union, a new federation’.(34) This federation was the Union of Soviet Socialist Republics, the USSR. This principle was already there in the 1918 draft, and in the first Soviet Constitution,

At the same time, endeavoring to create a really free and voluntary, and therefore all the more firm and stable, union of the working classes of all the nations of Russia, the Constituent Assembly confines its own task to setting up the fundamental principles of a federation of Soviet Republics of Russia, while leaving it to the workers and peasants of each nation to decide independently at their own authoritative Congress of Soviets whether they wish to participate in the federal government and in the other federal Soviet institutions, and on what terms.(35)

The logic of the federation within the USSR applied similarly to the colonial question. In the 1918 declaration, Lenin had written that the new state must have a ‘complete break with the barbarous policy of bourgeois civilization, which has built the prosperity of the exploiters belonging to a few chosen nations on the enslavement of hundreds of millions of working people in Asia, in the colonies in general, and in the small countries’.(36)

When the Communist International (Comintern) met for its first meeting in 1919, the jubilation of the Soviet experience combined with the potential revolution in Europe (particularly Germany) and the emergence of working-class and peasant movements in Asia defined its outcome. The Comintern addressed the ‘proletariat of the entire world’, telling them,

‘The emancipation of the colonies is possible only in conjunction with the emancipation of the metropolitan working class. The workers and peasants not only of Annam, Algiers and Bengal, but also of Persia and Armenia, will gain their opportunity of independent existence only when the workers of England and France have overthrown Lloyd George and Clemenceau and taken state power into their own hands’.(37) Nationalism of the oppressed nations barely earned a mention. The defeat of the German revolution and the setbacks in the colonies provoked a more sober tone at the second Comintern meeting (1920). Lenin’s views on the colonial (Eastern) question drew from his more capacious attitude toward nationalisms of the oppressed. It was the presence of the Indian Marxist M. N. Roy that stayed Lenin’s hand and curtailed his more ebullient support for anti-colonial nationalism. The second thesis of the Comintern emerged out of a compromise formulation between Lenin’s own draft and Roy’s emendations (with the Dutch Marxist Henk Sneevliet holding their hands to the same pen),

As the conscious express of the proletarian class struggle to throw off the yoke of the bourgeoisie, and in accordance with its main task, which is the fight against bourgeois democracy and the unmasking of its lies and hypocrisy, the Communist Party should not place the main emphasis in the national question on abstract and formal principles, but in the first place on an exact evaluation of the historically given and above all economic milieu. Secondly it should emphasize the explicit separation of the interests of the oppressed classes, of the toilers, of the exploited, from the general concept of the national interest, which means the interests of the ruling class. Thirdly it must emphasize the equally clear division of the oppressed, dependent nations which do not enjoy equal rights from the oppressing, privileged nations, as a counter to the bourgeois democratic lie which covers over the colonial and financial enslavement of the vast majority of the world’s total population, by a tiny minority of the richest and most advanced capitalist countries, that is characteristic of the epoch of finance capital and imperialism.(38)

Nothing in this thesis contradictions the spirit of Lenin’s own view on self-determination, expect in so far as this makes explicit Lenin’s hesitancy over the character of the bourgeoisie of the oppressed nations. The 9th thesis said that the Comintern ‘must directly support the revolutionary movement among the nations that are dependent and do not have equal rights (for example Ireland, the Blacks in America, and so forth) and in the colonies’.(39) At the same time, the Comintern, in the 11th Thesis noted that it must engaged in a ‘resolute struggle’ against the attempt to ‘portray as communist the revolutionary liberation movements in the backward countries that are not truly communist’.(40) The Comintern supports the revolutionary movements in the colonies ‘only on condition that the components are gathered in all backward countries for future proletarian parties–communist in fact and not only in name–and that they are educated to be conscious of their particular tasks, that is, the tasks of struggling against the bourgeois-democratic movement in their own nation’. What the Comintern ‘must unconditionally maintain the independent character of the proletarian movement, be it only in embryo’.(41) Lenin’s general principles articulated in his essays from 1914 onwards were enshrined in the Soviet Constitution and in the Comintern, with some alterations to fit the new situations and the new class configurations.

No surprise that radicals from the colonised world–such as Ho Chi Minh and José Carlos Mariategui–found Leninism to be the heart and soul of their political outlook. It was this anti-colonial Marxism that drew radical nationalists from the Dutch colonies of Indonesia to the French colonies of West Africa, and it was this strong theory of anti-colonial national self-determination that forged ties for the Marxist left across these worlds.(42) Little wonder then that the tradition of ‘Western Marxism’ tends to ignore Lenin, to jump from Marx to Lukacs and Gramsci, evading the fact that Lukacs wrote a book on Lenin and that Gramsci developed his own thought with Lenin in mind; the leap over Lenin is a leap not only over the experience of the October Revolution but it is a leap past the Marxism that then develops in the Third World, a leap into abstract philosophy with little engagement with praxis and with the socialism that develops–not in the advanced industrial states–but in the realm of necessity, in the former colonised world from China to Cuba. In those outer reaches, where revolutions have been successful, it is the anti-colonial Lenin that guides the way.

Vijay Prashad is an Indian historian, editor and journalist. He is a writing fellow and chief correspondent at Globetrotter, a project of the Independent Media Institute. He is the chief editor of LeftWord Books and the director of Tricontinental: Institute for Social Research. He has written more than twenty books, including The Darker Nations: A People’s History of the Third World (The New Press, 2007), The Poorer Nations: A Possible History of the Global South (Verso, 2013), The Death of the Nation and the Future of the Arab Revolution (University of California Press, 2016) and Red Star Over the Third World (LeftWord, 2017). He writes regularly for Frontline, the Hindu, Newsclick, AlterNet and BirGün.

Notes

1. Lenin, ‘Backward Europe and Advanced Asia’, Pravda, 18 May 1913, Collected Works, vol. 19, pp. 99-100.

2. Lenin, ‘Draft Resolution of the Tasks of the Party in the Present Situation’, January 1912, Collected Works, vol. 17, p. 456 and ‘Resolutions of the Conference. The Russian Organising Commission for Convening the Conference’, January 1912, Collected Works, vol. 17, p. 485.

3. Lenin, ‘The War on China’, Iskra, no. 1, December 1900, Collected Works, vol. 4, pp. 372-77.

4. Lenin, ‘Events in the Balkans and in Persia’, Proletary, no. 37, 16 October 1908, Collected Works, vol. 15, p. 221.

5. Lenin, ‘The Discussion of Self-Determination Summed Up’, July 1916, Collected Works, vol. 22, p. 357.

6. Lenin, ‘A Caricature of Marxism and Imperialist Economism’, Zvezda, October 1916, Collected Works, vol. 23, p. 60.

7. Vijay Prashad, ‘For Comrade Lenin on his 150th Birth Anniversary’, Lenin 150, New Delhi: LeftWord Books, 2020.

8. All these articles are in Lenin, Collected Works, vol. 20.

9. Horace B. Davis collected the five articles by Luxemburg from her Kraków journal Przeglad Sozialdemokratyczny in The National Question. Selected Writings, New York: Monthly Review Press, 1976.

10. J. V. Stalin, ‘Marxism and the National Question’, Collected Works, vol. 2, Moscow: Foreign Language Publishing House, 1953.

11. V. I. Lenin, The Right of Nations to Self-Determination, Moscow: Progress Publishers, 1967.

12. Vijay Prashad, ‘Vladimir Ílyiç Lenin/Uluslarin Kaderlerini Tayin Hakki’, Marksist Klasikleri Okuma Kilavuzu, Istanbul: Yordam Kitap, 2013.

13. Luxemburg, The National Question, p. 107. For a critical appraisal of Polish Social Democracy, see Eric Blanc, ‘The Rosa Luxemburg Myth: A Critique of Luxemburg’s Politics in Poland (1893–1919)’, Historical Materialism, vol. 25, issue 4, 2017.

14. Luxemburg, The National Question, pp. 133-135.

15. Lenin, ‘The Right of Nations to Self-Determination’, Collected Works, vol. 20, p. 396.

16. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, p. 409.

17. On 24 October 1869, Engels wrote to Marx, ‘Irish history shows what a misfortune it is for one nation to subjugate another. All English abominations have their origin in the Irish pale. I still have to bone up on the Cromwellian period, but it appears clear to me that things in England would have taken another turn but for the necessity of military rule in Ireland and creating a new aristocracy’. Marx/Engels, Collected Works, vol. 43, p. 362.

18. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, p. 410.

19. Lenin, ‘The Right of Nations to Self-Determination’, Collected Works, vol. 20, p. 412.

20. Lenin, ‘The Right of Nations to Self-Determination’, Collected Works, vol. 20, p. 412.

21. Lenin, ‘The Right of Nations to Self-Determination’, Collected Works, vol. 20, p. 432.

22. In an early formulation, Lenin argued not for the ‘self-determination of nations’ but for the ‘self-determination of the proletariat’. ‘We on our part concern ourselves with the self-determination of the proletariat in each nationality rather than with the self-determination of peoples or nations’. (‘On the Manifesto of the Armenian Social Democrats’, Iskra, 1 February 1903, Collected Works, vol. 6, p. 327). It appears that this position is close to that of Luxemburg, that nationalism of the bourgeoisie had to be opposed in all respects, and that the Social Democrats must take a class view over a national view. Over the course of the decade, Lenin changed his position–no longer was there the emphasis on the ‘self-determination of the proletariat in each nationality’. Lenin now saw the difference between the oppressor nationality and the oppressed nationality, which nuanced his stand a great deal.

23. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, p. 409.

24. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, pp. 412-413.

25. Lenin, ‘The Socialist Revolution and the Right of Nations to Self-Determination: Theses’, Collected Works, January-February 1916, vol. 22, p. 143.

26. Lenin, ‘The Socialist Revolution and the Right of Nations to Self-Determination: Theses’, Collected Works, January-February 1916, vol. 22, p. 165.

27. Lenin, ‘The Socialist Revolution and the Right of Nations to Self-Determination: Theses’, Collected Works, January-February 1916, vol. 22, p. 150.

28. Lenin, ‘Socialism and War. The Attitude of the RSDLP Towards the War’, Sotsial-Demokrat, 1 November 1914, Collected Works, vol. 21, p. 316.

29. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, p. 408.

30. Luxemburg, The National Question, p. 123.

31. Warren Lerner, Karl Radek, the last internationalist, Palo Alto: Stanford University Press, 1970.

32. Lenin, ‘The Revolutionary Proletariat and the Right of Nations to Self-Determination’, Collected Works, vol. 21, p. 408.

33. Rosa Luxemburg, The Russian Revolution, and Leninism or Marxism?, Ann Arbor: University of Michigan Press, 1961, pp. 49-50.

34. Lenin, ‘On the Establishment of the USSR’, 26 September 1922, Collected Works, vol. 42, pp. 421-422.

35. Lenin, ‘Declaration of Rights of the Working and Exploited People’, 3 January 1918, Collected Works, vol. 26, p. 425.

36. Lenin, ‘Declaration of Rights of the Working and Exploited People’, 3 January 1918, Collected Works, vol. 26, p. 424.

37. ‘Manifesto of the Communist International to the Workers of the World’, 6 March 1919, Liberate the Colonies. Communism and Colonial Freedom, 1917-1924, ed. John Riddell, Vijay Prashad, and Nazeef Mollah, New Delhi: LeftWord Books, 2019, p. 33.

38. ‘Theses on the National and Colonial Question’, 1920, Liberate the Colonies, p. 94.

39. ‘Theses on the National and Colonial Question’, 1920, Liberate the Colonies, p. 97.

40. ‘Theses on the National and Colonial Question’, 1920, Liberate the Colonies, p. 98.

41. ‘Theses on the National and Colonial Question’, 1920, Liberate the Colonies, p. 98.

42. Vijay Prashad, Red Star Over the Third World, New Delhi: LeftWord Books, 2017.

Under Capitalism Black Lives Are Adrift and Vulnerable

By W. T. Whitney, Jr.

Originally published at Monthly Review.

It’s true. Too often, in too many circumstances, for too long, the lives of Black people in the United States don’t matter. Black people fill prisons; their children fill terrible schools; many are poverty-stricken. But at issue here are the killings and people being left to die.

Post-Civil War arrangements by which the victorious North settled with the defeated slavocracy ensured that many Black people would not matter much and that some would die. A thousand or so were murdered in the South in 1866, reports W.E. B Du Bois. Over 2000 more would be lynched during the Reconstruction years, as documented recently by the Equal Justice Initiative. [1] That organization had already documented and memorialized thousands of lynching deaths occurring between 1877 and 1950.

The police killings of Black people prompted the formation of Black Lives Matter. But they die unnecessarily in others ways. Life expectancy is far shorter and infant mortality far greater for U.S. Blacks, for example, than for white people.

According to journalist Adam Serwer, writing in the Atlantic,

The lives of disproportionately black and brown workers are being sacrificed to fuel the engine of a faltering economy.” Specifically, “workers at the front lines of the [COVID-19] pandemic—such as meatpackers, transportation workers, and grocery clerks—have been deemed so worthless that legislators want to immunize their employers from liability.

Significantly, even white people viewed as worthless may be in trouble. Texas Lt. Governor Dan Patrick, commenting on the Covid 19 pandemic, told a reporter that “there are more important things than living. And that’s saving this country.” Representative Hollingsworth of Indiana identified Coronavirus deaths as “the lesser of these two evils,” the other being economic collapse.

That white people die because they don’t matter is revealing.  They too may be disposable—if they are unnecessary, in the way, or far off. The victims of Hiroshima, Nagasaki, and Dresden are remembered, as are indigenous peoples decimated by settlers and invaders, and civilians and combatants dying in U.S. wars. The political powers seem to be at ease presently with the probability that millions will be dying soon due to climate change.

Dan Glazebrook, writing for Counterpunch, is a witness. He asserts that, “one product has defined capitalism above all else: human waste.” Criticizing Britain’s management of the COVID-19 crisis, he notes that,

Superfluous people, not necessary for production, not able to participate in the market, and an ever-present threat to the stability of the system [are] the main output of the bourgeois epoch.…. [S]urplus Europeans were exiled…to the colonies…to continue the process of exterminating surplus non-Europeans.

Glazebrook cites urban theoretician and historian Mike Davis’s observation that up to 3 billion informal workers constitute “the fastest-growing and most novel social class on the planet.” But this “is not a labor reserve army in the nineteenth-century sense: a backlog of strikebreakers. [It’s] a mass of humanity structurally and biologically redundant to global accumulation and the corporate matrix.”

Marxist scholar Andy Merrifield identifies some people as “residues.”

They’re minorities who are far and away a global majority. They’re people who feel the periphery inside them, who identify with the periphery, even if sometimes they’re located in the core. Residues are workers without regularity, workers without any real stake in the future of work…. A lot of these residues know that now work is contingent [and] life itself is contingent.

George Floyd’s life was contingent. The lives of U.S. Black people who don’t matter are residues.

Under capitalism, human beings are valued for their use. Enslaved, Black workers were useful, even essential. Then their agrarian society merged with the larger one embarked upon industrial production and territorial expansion. They acquired a distant master that, like the old one, measured the worth of workers with an economic yardstick.

Black agricultural workers, bereft of education, their ancestors stolen from Africa, didn’t fit the capitalist mold. European immigrants ready to work in factories or to occupy land being opened up by the railroads amply fulfilled capitalist objectives.  From Reconstruction on, Black people were marginalized in a country where social needs are neglected and public attention distracted. Violent thugs threatening them have had free rein.

Du Bois in his Black Reconstruction in America (1935) offers an explanation for how the failure of Reconstruction led to limited political rights for Black people and exclusion from real participation in the larger society. Initially,

the reconstructed states were in the power of the rebels and…they were using their power to put the Negro back into slavery.” But the North “united its force with that of the workers to uproot the still vast economic power of the planters. It hoped…to induce the planter to surrender his economic power peacefully, in return for complete political amnesty.

The northern business class was insecure: “the Republican party which represented it was a minority party.” But “united with abolition-democracy [with its] tremendous moral power and popularity,” the party hoped to “buttress the threatened fortress of the new industry.” Giving Blacks the vote “would save the day.” The Republicans sought to nullify apportionment based on non-voting slaves, as provided for in the Constitution. Southerners had relied on that device to inflate their representation in Washington.

But poor whites in the South regarded Blacks as wage competitors. Landowners proceeded to “draw the color line and convince the native-born white voter that his interests were with the planter class.” Poor whites “thought of emancipation as giving them a better chance to become rich planters, landowners, and employers of Negro labor.” They wanted “to check the demands of the Negroes by any means” and were willing “to do the dirty work of the revolution that was coming, with its blood and crass cruelties.”

In the North, “Abolitionists failed to see that…the nation did not want Negroes to have civil rights and that national industry could get its way easier by alliance with Southern landholders than by sustaining Southern workers.” And so, “labor control passed into the hands of white southerners, who combined with white labor to oust northern capitalists” and themselves manage a southern-style capitalist economy.

What resulted remained for decades. Wages for Black people, initially non-existent or very low, stayed depressed. Aspiring Black landowners met resistance, eventually at the hands even of New Deal officials. Because the methods of exploitation available to southern overlords, sharecropping and the convict-leasing system, were less profitable than those available to northern capitalists, the material value of southern Blacks stayed low.

Most Black people were barred from occupying a sustainable niche in the productive apparatus of the U.S. economy. They’ve verged on the irrelevant, remaining as a “residue,” at risk of being disposed of.

Nevertheless, the U.S. political system has been open enough to allow many Black people to find remunerative work, elevate their social-class status, and be safe. Even Black workers defied expectations: in 1950, 43% of Black men in Michigan were working in the auto industry. [2]

The argument here has centered on social-class difference. But racism, which operates as a means for imposing differentiation among humans, also had a part. The notion of racism elaborated by political scientist Adolph Reed Jr. is relevant. Reed explains that racism showed up historically as a tool devised by oppressors for dealing with social conflict. He claims that white settlers and other exploiters configured differences among humans—physical, cultural, and religious plus others fashioned out of upper-class snobbery—into an all-embracing concept of race. They thus gained the ability to weaponize inequalities within human society, the better to enforce oppression.

One example: southern elites, from Reconstruction on, arranged for Blacks and the white underclass to be at each other’s throats. Their northern counterparts did likewise, leaving it so that Blacks and whites don’t easily unite in common struggle.

Racism serves as an adjunct to classed-based oppression. Causing pain, it works for maintaining social-class boundaries. The combination of the two has resulted in Black people being left with a generally precarious role within U.S. society and with vulnerability to lethal violence.

Some basic ideas, no less true for being platitudinous, may suffice to conclude this effort. One, an injury to one is an injury to all. Two, ruling class prerogatives and oppression travel in the same lane. Three, dedication to equality, radical or otherwise, does matter.

Anti-colonialist intellectual and activist Franz Fanon has the last word: “For my part, the deeper I enter into the cultures and the political circles the surer I am that the great danger that threatens Africa is the absence of ideology.” You need to replace “Africa” with “USA.”

W. T. Whitney Jr. is a political journalist whose focus is on Latin America, health care, and anti-racism. A Cuba solidarity activist, he formerly worked as a pediatrician.

Notes

[1] “Reconstruction in America–Racial Violence After the Civil War, 1865–1876,” Equal Justice Initiative, Montgomery, Alabama, pp. 118.

[2] Victor Perlo, People vs. Profits, (International Publishers, NY, 2003), p. 181.

Why Do Stocks Rise While the Country Burns?

By Contention News

This is a special edition of Contention News, a new dissident business news publication, shared exclusively at the Hampton Institute. You can read more and subscribe here. 

A reader sent us a brief, important request this week: “would like to see more on why markets are up when the world is on fire.” 

This is, in many ways, the theme of almost every edition of Contention, and we’ve pulled it apart a number of times:

• Dire economic straits can be good for big business as workers are less likely to press for higher wages, and competition goes bankrupt.

• Investment prices are all about expectations, and the big losses businesses keep reporting aren’t as bad as predicted.

• Those forecasts aren’t rational, and investors are arbitrarily assuming the worst can’t happen.

• Central bank action is swelling asset prices — not like a bubble, but like a tumor.

But let’s elaborate the reasons for this disconnect yet again, because new explanations emerge all the time. Multiple phenomena are causing this contradiction, all part of the same basic force: state manipulation of markets to protect concentrated wealth.

First, let’s be clear: “markets” are not up in every sense. The major indexes are up: the S&P 500 and Nasdaq are already back at record levels and the Dow is not far off its all-time-high. But this is a reflection of the exceptional performance of very few components in each index, not broad-based gains. As of last week:

• Half of the stocks that make up the S&P 500 are down for the year still, only 4% of its components are driving all the record gains. 

• The digital oligopoly — Facebook, Apple, Amazon, Alphabet, and Microsoft — are up 37% this year, but without them the S&P 500 is down 6%.

• Fully 64% of S&P 500 components are underperforming the index, and they’re missing it by an average of 22%. 

• All-country stock performance minus the S&P 500 has done nothing this year. 

This international perspective highlights another crucial, largely unreported aspect of the alleged stock rally: pricing the S&P 500 in euros instead of dollars wipes out all of its record performance. 

The bull run is closely associated with the devaluation of the dollar, because inflated liquidity is being blasted directly at equity markets. 

Remember: stock prices reflect discounted future cash flows. Cash flow means income left over after expenses, so if investors have reason to believe that income will increase or expenses decrease in the future, stock prices move up. Monopoly pricing power means higher income, suppressed wages mean lower expenses, so large-scale bankruptcies and unemployment can actually benefit large firms.

Earnings expectation beats have moved stock prices upwards, but only 1% of that outperformance has come from increased income. The rest has come from cutting expenses, i.e. the very layoffs and cancelled purchases that make the rest of the economy miserable.

Because forecasts around cash flows aren’t certain, prices take into account a risk factor closely associated with interest rates. The larger the risk, the bigger the discount for the future cash flows, and the lower the stock price goes.

The Federal Reserve has taken emergency action this year to suppress interest rates. It dropped the rate it charges banks to near-zero levels, but more importantly it bought up trillions of dollars in bonds — including corporate bonds for the first time. 

Bond prices and their interest rates move inversely to one another, so this single-payer bond market bids up prices and sets a ceiling for rates. This squeezes investment out of safe assets, and makes riskier investments — like stocks — artificially more secure-looking. 

The implicit — sometimes explicit — assumption is that the Fed won’t let markets crash for long. We now have central planning for capital, so why wouldn’t you buy? 

But if the cost cuts that drove earnings beats in the last quarter have now hit bone, if failed fiscal stimulus means a big drop in aggregate demand, or if accelerating political chaos raises volatility too much and markets do drop, what can the Fed do? Their only card left may be to intentionally depreciate the dollar in even more aggressive ways. 

That is to say, the most likely outcomes of our present condition are that things keep burning like they are or the people that started the blaze will throw gasoline on it. Either way Contention will be here to sound the alarm. 

For more anti-imperialist business analysis, subscribe to Contention. 

A Marxist Vision for the Post-Sanders American Left

[Pictured: Members of the Party for Socialism and Liberation (PSL) in NYC}

By Matthew John

As a socialist writer who has been regularly producing political commentary for the last three years, I’ve made some observations about the state of the American Left and it’s potential future prospects. Though my political education began with reading authors like Noam Chomsky and Howard Zinn nearly two decades ago, I have more recently evolved in my political tendency and now consider myself a Marxist-Leninist. With the advent of Bernie Sanders and the prospects for social democracy in the United States, I was both inspired and frustrated during recent years.

My political views changed significantly over the course of the tumultuous four-year period that included both of Bernie’s presidential runs. But it wasn’t all at once, like a “Eureka!” moment. There was considerable overlap between my espousal of Marxism and my naïve hope in a Sanders-led push toward social democracy. I believe my political trajectory is far from unique and I believe others can change their minds, just as I did. After all, there is a vast population of disgruntled American progressives who recently watched their dreams of a “democratic socialist” presidential administration dashed before their eyes by a relentless, neoliberal, ruling-class institution; the Democratic Party.

Although I am somewhat new to Marxism-Leninism, I have recently read Lenin’s “State and Revolution,” Michael Parenti’s “Blackshirts and Reds,” Walter Rodney’s “The Russian Revolution: A View from the Third World,” and Douglas Tottle’s somewhat obscure “Fraud, Famine and Fascism.” I am currently reading Vincent Bevin’s “The Jakarta Method,” and have many more books on communism and socialism in my queue. These texts and other sources of information (such as online publications and the Revolutionary Left Radio podcast) have allowed me to refine my views on socialism and consider what might be the best path toward this daunting task of reconstructing society. My recent trip to Cuba then provided tangible inspiration in this pursuit.

The goal, simply put, is for the working class to gain control of the political system and the economy so that industrial production is harnessed primarily for human need and public good. Once the “means of production” are decidedly seized, universal human flourishing can then be persistently pursued. Under capitalism, things like housing, healthcare, food, and education are largely commodified. Assuming adequate resources exist, socialists like myself believe these services should be human rights. Building class consciousness, political education, the capacity for community defense and mutual aid, and developing socialist political parties are some of the major projects that await us. But a primary barrier to these prerequisites is a ubiquitous Western phenomenon: anti-communism.

There are certain postures Bernie Sanders himself adopted that not only fall into the category of “left anti-communism” (such as the demonization of socialist projects of the Global South like Venezuela and Cuba), but also contributed to his demise (such as Russiagate). Whether or not Sanders personally believes in all of his public stances is another issue all together. But speculation could lead us to surmise that Sanders felt the best political calculation was to lean into the anti-communist rhetoric; after all, most of the American political landscape is still saturated with evidence-free, McCarthyist stereotypes of Marxism and Actually Existing Socialism (many of which originated with conservative — or in some cases fascist — sources; a fact all self-proclaimed “progressives” should care about).

In addition to recognizing the fabrications and McCarthyism of tactics like Russiagate, we need to continue exposing voter suppression, the corporate nature of the two-party system, and the problems with bourgeois democracy more broadly. We also need to re-examine imperialist lies beyond just the Cold War variety (many of which Sanders and other progressives utilize in their rhetoric). And we need to recognize the glaring omission of the entire topic of Western imperialism and neo-colonialism within the rhetoric of “democratic socialism”, especially in terms of the foreign resource extraction required of an empire like the U.S. and the related culpability of a hypothetically successful progressive presidential administration.

A larger theme in this discourse is the progressive push for Medicare for All, tuition-free college, housing reform, and other such policies. These and similar initiatives are consistently implemented by socialist countries, as they are in the material interests of the working class. Of course, this is yet another element of Western anti-communism; the whitewashing and omitting of the actual, tangible accomplishments of socialism (which Parenti and others have elucidated). It is important to explore this topic in general, but also to point out the inherently white supremacist, colonialist nature of such omissions, as they discount and marginalize the vast accomplishments of the anti-colonial and socialist movements of the Global South. This phenomenon can be witnessed pretty much any time American “progressives” share information about how all other “industrialized” nations have some form of universal healthcare, yet they consistently fail to mention Vietnam, the DPRK, Cuba, Venezuela, etc.

Speaking of Venezuela, there should also be a discussion of this oil-rich, Latin American nation as a modern example of Actually Existing Democratic Socialism, including the inherent challenges in such a path. These include far-right political parties and their violent sabotage in coordination with the still-existing bourgeoisie, specifically large companies hoarding food, right-wing protesters burning food, etc. — phenomena practically unheard of in countries that have taken a more Marxist-Leninist path. A major lesson from this particular discussion, once again, is that these progressive social programs have already been successfully enacted by revolutionary socialist governments around the world — not just by Western bourgeois welfare states. We therefore have numerous historical models regarding how to accomplish this outside of the false notion of socialism that has found its way into American political consciousness (which is essentially just social democracy accompanied by vaguely socialist rhetoric).

The progressive movement centered around the presidential candidacies of Bernie Sanders has certainly had a far-reaching and positive impact. If nothing else, this effort accurately described the desolate material conditions in the “land of the free”, proposed reasonable solutions, and paved the way for future socialists to become involved in American politics. Possibly most importantly, Sanders has softened the blow of the “S” word, especially with Millennials. (Due to the vestiges of Cold War propaganda and McCarthyism, socialism has largely been portrayed as some sort of cartoonish “evil” in Western discourse.)

Bernie’s “Political Revolution” unfortunately failed, but if it had succeeded, the success might have only been temporary. When social democratic reforms (like the New Deal) are implemented, those gains can be — and usually are — rolled back significantly by the tenacious forces of capital, which are allowed to continue operating under capitalism and within bourgeois democracy. In short, not only are the reforms themselves compromises with the ruling class (and therefore watered-down half measures), but they are subject to the whims of the ruling class, which has not been overthrown. In addition to our own New Deal legislation being gradually decimated by neoliberalism, things could end up even worse, as Chileans tragically learned in 1973.

Despite the momentary setbacks experienced by the progressive Left, I find myself optimistic that, when properly introduced to the ideas of Marxism, it is often the case that “non-sectarian” progressives and leftists will respond positively and openly. It happened to me, it has happened to acquaintances and many social media users I have interacted with, and it can happen to others as well. Learning about anti-communist propaganda and the rich, global history of socialism can be a very rewarding and liberating process, and those who have a pre-existing distrust of major Western institutions are inherently more receptive to this type of information. The failures of the attempted “progressive insurgency” within the Democratic Party and the subsequent widespread disillusionment should also serve as catalysts for American progressives who are seeking new analyses and visions for a future socialist reality. We must learn from these domestic failures and look to the infinitely demonized, yet successful global socialist triumphs of history.

It is time for progressives and working-class Americans of all stripes to unite and chart a path toward true socialism and human liberation. As Marx said, “You have nothing to lose but your chains!”

"It's A Class Struggle, Goddammit!": A Speech by Fred Hampton (1969)

The following is the full transcript of a speech delivered by Fred Hampton at Northern Illinois University, November, 1969

What we're going to try to do, is we're going to try to rap and educate. We're glad to try to throw out some more information. And it's going to be hard to do. The Sister made a beautiful speech as far as I'm concerned. Chaka, the Deputy Minister of Information, that's his job--informing. But I'm going to try to inform you also.

One thing Chaka forgot to mention that Brothers and Sisters don't do exactly the same. We don't ask for any Brother to get pregnant or anything. We don't ask no brothers to have no babies. So that's a little different also.

After we get through speaking, for those people of you who don't think you understood all of the ideology exposed here so far, and the ideologies that I will espouse, we will have a question and answer period. For those people who have their feelings hurt by niggers talking about guns, we'll have a cry'in after the question and answer period. And for those white people that are here to show some type of overwhelming manifestation of guilt syndromes, and want people to cry out that they love them, after the cry-in, if we have time, we'll allow you all to have a love-in.

So now we'll get down to business. First of all, about what some people call the TRIAL. We call it a HECATOMB, we call it a hecatomb. That's spelled h-e-c-a-t-o-m-b. And I know there's enough dictionaries floating around up here to probably fill the room up, so you can check that out. It means a sacrifice. It usually means a sacrifice of an animal. So we'd like you, if you'd like to do that, so people ask you "Have you been to the trial," tell them that you've been down or heard about the hecatomb, because that's what it is. It's a public sacrifice. It's a situation where they're trying to unjustly, illegally try our Chairman.

We look at it as a 1969 manifestation of the Dred Scott Decision. We look at Chairman Bobby as being the manifestation of Dred Scott in 1857. And we look at Judge Hoffman as being a manifestation of Judge Taney in 1857. Because in 1857 Dred Scott was a negro, a former slave--he was still a slave, because we're slaves--who went into court and evidently had some type of misunderstanding about what he was in American society, where he fit in.

So he went to the Supreme Court to have Judge Taney answer him and try to clear up some mistaken ideas that he had floatin' around in his little old head. Ang Judge Taney did just that. Judge Taney explained to him very clearly that, "Nigger, you're nobody, you're property, you're a slave. That the systems--the legal system, the judicial system--all types of systems that are functioning in America today was set up long before you got here, brother. Because we brought you over to make money to keep what we've got going, these avaricious, greedy businessmen, to keep what we've got going, going on."

And Dred Scott couldn't understand this. There was a big rebuttal. And at that time, Judge Taney made a statement that has become famous. And that statement, maybe not in the same words but through actions ant through social practice, is being manifested down at the New reigstag Building at Jackson and Dearborn. It's being manifested through Judge Hoffman by saying the same thing that Judge Taney said in 1857. When he told Dred Scott that "Nigger, a black man in America has no rights which a white man is bound to respect." And that's the same thing that Judge Hoffman is telling our Chairman every day.

And we understand. You know a lot of people have hang-ups with the Party because the Party talks about a class struggle. And the people that have those hang-ups are opportunists, and cowards, and individualists and everything that's anything but revolutionary. And they use these things as an excuse to justify and to alibi and to bonify their lack of participation in the real revolutionary struggle. So they say, "Well, I can't dig the Panther Party because the Panthers they are engrossed with dealing with oppressor country radicals, or white people, or hunkies, or what have you. They said these are some of the excuses that I use to negate really why I am not in the struggle."

We got a lot of answers for those people. First of all, we say primarily that the priority of this struggle is class. That Marx, and Lenin, and Che Guevara end Mao Tse-Tung and anybody else that has ever said or knew or practiced anything about revolution, always said that revolution is a class struggle. It was one class--the oppressed--those other class--the oppressor. And it's got to be a universal fact. Those that don't admit to that are those that don't want to get involved in a revolution, because they know that as long as they're dealing with a race thing, they'll never be involved in a revolution. They can talk about numbers; they can hang you up in many, many ways, but as soon as you start talking about class, then you got to start talking about some guns. And that's what the Party had to do.

When the Party started to talk about class struggle, we found that we had to start talking about some guns. If we never negated the fact that there was racism in America, but we said that when you, the by-product, what comes off of racism, that capitalism comes first and next is racism. That when they brought slaves over here, it was to take money. So first the idea came that we want to make money, then the slaves came in order to make that money. That means that capitalism had to, through historical fact, racism had to come from capitalism. It had to be capitalism first and racism was a by-product of that.

Anybody that doesn’t admit that is showing through their non-admittance and their non-participation in the struggle that all they are, are people who fail to make a commitment; and the only thing that they have going for them is the education that they receive in these institutions—education enough to teach them some alibis and teach them that you’ve gotta be black, and you’ve gotta change you name. And that’s crazy.

The minister of education of the Party, Raymond “Masai” Hewitt, and Chief of Staff, David Hilliard, just got back from Africa visiting Eldridge Cleaver. And they said niggers over there never will be wearing the type of garb that some of these Africanized fools over here wear. They’re wearing rags or either they’re wearing nothing. And if you want to dress like some African people, then you oughta dress like the Angolans or the people in Mozambique. These are the people that are doing something. You need to dress like people that are in liberation struggles. But nah, you don’t want to get that Africanized, because as soon as you have to dress like somebody from Angola or Mozambique, then after you put on whatever you put on, and it can be anything from rags to something from Saks fifth Avenue, you got to put on some bandoliers and some AR-15’s and some 38’s; you’ve got to put on some Smith and Wessons and some Colt 45’s, because that’s what they’re wearin’ in Mozambique. And any nigger that runs around here tellin’ you that when your hair’s long and you got a dashiki on, and you got bubus and all these sandals, and all this type of action, then you’re a revolutionary, and anybody that doesn’t look like you, he’s not—that man has to be out of his mind.

Because we know that political power doesn’t flow from the sleeve of a dashiki. We know that political power flows from the barrel of a gun. And that’s true. It has to be true. We know that in order to be able to talk about power, that what you’ve got to be able to talk about is the ability to control and define phenomena and make it act in a desired manner. That means that if you can’t control and define phenomena and make it act in a desired manner, then you don’t even have any dealings with power, you don’t know and you probably never will know what power is. And we know what power is, and we know who’s doing harm to the people—the enemy.

And everybody wants to talk about…the pork chops will tell you in a minute “The pigs don’t want you to get black. They don’t want you to get no black studies programs. They don’t want you to wear dashikis. They don’t want you to learn about the motherland and what roots to eat of the ground. They don’t want that—because as soon as you get that, as soon as you go back 11th century culture, you’ll be alright.”

Check the people who went back to 11th century culture. Check the people that are wearing dashikis and bubus and think that that’s going to free them. Check all of these people, find out where they’re located, find out the addresses of their office, write them a letter and ask them if in the last year how many times their office been attacked. And then write any Black Panther Party, anywhere in the United States of America, anywhere in Babylon, and ask them how many times the pigs have attacked them. Then when you get your estimation of both of them, then you figure out what the pigs don’t like. That’s when you figure out what the pigs don’t like.

We’ve been attacked three times since June. We know what pigs don’t like. We’ve got people run out of the country by the hundreds. We know what pigs don’t like. Our Minister of Defense is in jail, our Chairman is in jail, our Minister of Information’s in exile, our Treasurer, the first member of the Party, is dead. The Deputy Minister of Defense and the Deputy Minister of Information, Bunchy, Alprentice Bunchy Carter, and John Huggins from Southern California, murdered by some pork chops, talking about a BSU program. We know what the pigs don’t like.

We said nobody would shoot a Panther but a pig, because Panthers don’t pose a threat to anybody but pigs. And if people tell you that Panthers pose threats, then ask them what kind of sense it would make, unless it’s to get up at 5 o’clock in the morning to feed somebody’s son and then at 3 o’clock that afternoon shoot him—save a meal. We don’t need to do that. What sense does it make for us to open up a free health clinic where the only prerequisite that you got to have to receive free medical aid is the prerequisite that you be sick. And we’ve got students who jiving themselves and running around playing, talking about they doin’ something for the struggle, and I want to know what more could you do? And you all people come from Chicago.

People talking about the Party co-opted by white folks. That’s what that mini-fascist, Stokely Carmichael said. He’s nothing but a jackanapes. As far as I’m concerned, he’s a jackanapes, cause I’ve been knowing him for years, and that’s all he could be, if he go around murder-mouthin’ the Black Panther Party.

If we’re co-opted by white people, then check the locations of our offices, our breakfast program, our free health clinic is opening up probably this Sunday at 16th and Springfield. No does everybody know where 16th and Springfield is at? That’s not in Winnetka, you understand. That’s not in Dekalb. That’s in Babylon. That’s in the heart of Babylon, Brothers and Sisters.

And that free health clinic was put there because we know where the problem is at. We know that black people are most oppressed. And if we didn’t know that, then why the hell would we be running around talking about the black liberation struggle has to be the vanguard for all liberation struggles? If there’s ever going to be any liberation in the mother country, ever gonna be any liberation in the colony, then we got to be liberated by the leadership of the Black Panther Party and the black liberation struggle. We don’t negate that fact.

We’re not hung up in anybody’s not a Panther. We don’t want to get you thinkin’ that, because we can dig Fred, I mean Everett, we can dig him. But we can’t dig Ron Karenga and LeRoi Jones. We can’t dig that. We can’t see any social practice on the part of them Brothers. We know that they both have names longer than my arm. And both of them supposed to be so intelligent and so smart. And that’s the problem right now.

We’re talking about destroying the system, and they have hang-ups doing that because they’re constantly buying property within the system. And it’s kind of hard to burn up on Tuesday what you bought last Monday. Because they’re a bunch of unrepentant capitalists. They’ll never repent. And they know better. We try to make excuses for them—“Maybe they’ll have to go through stages, Fred.” No, that’s not it. Because they’re much older than we are—I’m 21. We’re all young. So stages, they don went through them. Ron Karenga has more degrees than a thermometer. That’s right, he has more degrees than a thermometer and he continues to do what he’s doin’. And how do they fool you? Because they pick the leaders they want. And they put those people up there and portray them as being your leaders when, in fact, they’re leaders of nobody.

…we call the oppressed apologists. Because after something’s happened, all they can do is apologize for it. Look in the papers. Now they’re drawing pictures of the Chairman chained and gagged. Don’t you know that if the news media, the established press, had moved before this, that they could have stopped this rising tide of fascism years ago. But they endorsed, they joined, they supported what fascists were doing at the time. And now it’s being heaped down upon all of the people.

And a lot of people think now that their hands are getting dirty. We call them ideological servants of United States fascism. And that’s what they are, because they serve fascism by doing nothing about it until the law goes over and then they apologize for it, they get apologetic. But we say it’s the same press that we’ll look at and believe and think is bona fide; the same press that talked us into believing that we was somebody when in fact we were nobody.

I don’t think there’s anything more important. I think that what Malcolm says is important. Now think back. Those students were laughing at Malcolm. Can you dig it? They were laughing at Malcolm. Why? Regis Debray, he says the revolutionaries are in the future. That militants and pork chops and all these people, radical students, are in the present, and that most of the rest of the people try to remain in the past. That’s why when somebody comes that’s in the future of a lot of us can’t understand him. And the same thing that you don’t understand Huey P. Newton now, you didn’t understand Malcolm when he was living. But we know that when Malcolm left, the well almost ran dry. You don’t miss the water til the well runs dry, and it almost ran dry.

Huey P. Newton got to reading, and he’s not like a lot of us. A lot of us read and read and read, but we don’t get any practice. We have a lot of knowledge in our heads, but we’ve never practiced it; and made any mistakes and corrected those mistakes so that we will be able to do something properly. So we come up with like we say more degrees than a thermometer, but we’re not able to walk across the street and chew gum at the same time, because we have all that knowledge but it’s never been exercised, it’s never been practiced. We never tested it with what’s really happening. We call it testing it with objective reality. You might have any kind of thought in your mind, but you’ve got to test it with what’s out there. You see what I mean?

They talked us into buying candy bars and throwing the candy away and eating the wrapper. They’re the only people in the world, you understand, that’s right, that can sell ice boxes to Eskimoes. They can sell natural wigs to niggers that’s got natural hair already. And see, this is a shame. They can sell a one-legged man probably 24 tickets in a asskicking contest, and he knows he has no business being there. See, these are the things they can do to us and then they have us believe that what they’re tellin’ us is right, it’s bona fide, it’s justified. We say that’s wrong, that’s incorrect, that Malcolm, when he spoke to students, and you probably heard that record, he speaks to some Jews, some slick people, and he told them.

You might say, “Well, the way I feel, people ought to be able to walk around naked because rape is love.” That’s idealism. See what I mean? You’re dealing in metaphysics. You’re dealing in subjectivity, because you’re not testing it with objective reality. And what’s really wrong is that you don’t go test it. Because if you test it, you’ll get objective. Because as soon as you walk out there, a whole lot of objective reality will vamp down upon your ass and rape you of whatever you have. So whenever this happens, this is when people get a whole lot of mistaken ideas. That’s why a lot of you can’t understand and can’t agree with a lot of what we said. You’ve never tried it.

You don’t know whether people relate to the breakfast program, because you’ve never fed anybody. You don’t know anything about the free health clinic because you never asked anybody. You don’t know anything about the good that a gun does you, because you never tried one. And we say that if you was born and if you said you didn’t like pears and you never tasted pears, you’d have to be a liar. You don’t know whether you like pears, but you can’t claim that you don’t like pears. The only way that anybody can tell you the taste of a pear is if he himself has tasted it. That’s the only way. That’s the objective reality. That’s what the Black Panther Party deals with. We’re not metaphysicians, we’re not idealists, we’re dialectical materialists. And we deal with what reality is, whether we like it or not.

A lot of people can’t relate to that because everything they do is gagged by the way they like things to be. We say that’s incorrect. You look and see how tings are and then you deal with that. We runnin’ around talking about “We gonna love all black people. We have an undying love for all black people.” And you know what? That if Malcolm came back, he’d walk pas a million Klansmen to get to Stokely and whoop his motherfuckin’ ass. Because Malcolm was standing right like this in a room, where white people weren’t even allowed. You hear me? They wouldn’t allow no white people in there. But Malcolm’s dead. Now what happened? What’d that fool’s name, James Whitmore. Didn’t he do his little skin?

Because they had names with 37X, 15X, blacker than black, and they were able to sneak in because of this ignorant potient #9 that these maniacs are trying to whoop on us—“We gonna love all black people because every Negro is a potential black man.”

The man that testified against Chairman Bobby in the Conspiracy Trial down in Chicago was a black man. The man that has Chairman Bobby on a murder trial in Connecticut is a black man. The man who murdered Malcolm X is a black man. The judge that denied Eldridge Cleaver bond after a white man had granted him bond—a nigger who investigated on his own and said, “Nigger, I don’t think you ought to be on the street,” was a black man, Thurgood Marshall, Thurgood NOGOOD Marshall, that the NAACP put in. That’s one of the things about sittin’ in and dyin’ in and waitin’ in and cryin’ in got us. If Thurgood Marshall hadn’t been there, then Eldridge Cleaver would probably still be here with the people.

He’s a nigger, a bootlicker, a tonto, a jackanapes. You understand? Goin’ “I don’t think you should be on the streets.” And we runnin’ around lettin’ niggers tell us we got to love all black people.

You heard about the conspiracy trial on the West Side that they were able to win, with Doug Andrews and Fat Crawford, when they had the big burn on the West Side in the Martin Luther King riot? Ask ‘em! Brothers, what’s wrong with you, Brothers and Sisters? Ask ‘em was that a white man. No! Because Doug and them they criticized us for our liberal stand. They call it liberal. So they let nobody in their hood but black people. But they didn’t know. Anybody ever hear about Gloves on the South Side of Chicago? He’s not white. [Glove Davis was later on one of the Chicago policemen that participated in Fred’s assassination.] Did you think Buckney was white? Buckney, who’s taking all of your Brothers and all of your little Sisters and all of your little cousins and nephews, and he’s gonna continue to take ‘em. And if you don’t do anything, he’s gonna take your sons and your daughters. And a lot of niggers is going to school now trying to make a name. We don’t hear nobody running around talking about “I’m Benedict Arnold, III,” because Benedict Arnold’s children don’t want to talk about they his children. You hear people talking about they might be Patrick Henry’s children—people that stood up and said “Give me liberty or give me death.” Or Paul Revere’s cousin. Paul Revere said, “get your guns, the British are coming.” The British were the police.

Huey said “Get your guns, the pigs are coming.” Same thing. There’ll be a lot of Newtons running around. A lot of your kids will be calling themselves Huey P. Newton, III. They won’t be calling themselves Ooga-Booga or Karangatang Karenga, or Mamalama Karenga—none of that shit. They won’t be calling themselves that. You see, ask the pigs in California. Ask them! You see that? Hand me one of them posters, Brother. The one right there. Now if you think I’m lying, look at this. Take a look at this. Now all you Sisters here, tell me what looks better—a nigger runnin’ around in a robe and a staff pole, lookin’ like Moses, or these bad—these are the baddest lookin’ …. You might think, you might say you’re chauvinistic, organizational chauvinistic you might call it. You might call me wrapped up in the Party’s own ego. But I’m wrapped up in the truth. And I think the Sister can verify that these are the baddest. These are the movie stars for Babylon, Godamnit. Huh? Fuck John Wayne and all this other shit.

Alright. But you see, if you look at that, that’s what we look good in. We don’t care if niggers wear dashikis. You understand? That’s not gonna mean anything in the final analysis. But we’re saying that you need some tools.

You ever had the occasion to have a doctor come to your house, or a plumber comes to your house? Suppose a plumber came to your house, he opened up his bag and he had stethoscopes and thermometers and hypodermic needles and syringes. You’d say “You came to fix the plumbing? Brother, you got the wrong tools. Something suspicious is going on because you don’t even have the proper tools.” Ain’t that right?

Suppose somebody came to deliver your baby and he had plumber's tools? I know you Sisters would scream bloody murder. No but you’d say, “This is not right, Brother. We can’t have this. You got to, you understand, you gotta come a little easier, you got to show me something better. You got to have some tools that are more appropriate for the occasion, you understand, because I don’t have any runny faucets or anything.”

So when people come into our community with tanks, when they come into Babylon or Warsaw, or whatever you want to call it, like they did into Henry Horner Projects—and that’s a manifestation of, a very clear manifestation of what’s happening in Babylon. When they do that, when they come in there with tanks and those tanks are tools, those tanks are tools of war, they’re declaring war on the community. And if you, when they come into the community with tanks, you come out with dashikis and nothin’ but dashikis, bubus and nothin’ but bubus, sandals and nothing but sandals, then you’re in the wrong place at the wrong time with the wrong people. You’d better go back in the house, if you have to strip buck naked, if you got to get asshole naked, put you on even if it ain’t nothing but a holster and a gun and some ammunition. Take your bear ass, you understand, and they won’t consider you being naked. Nobody will try, you understand, to whistle at you, or anything. Cause this will be gone from the minute …any kind of sexual attraction you had will be gone. Cause they will be looking at Mr. and Mrs. Colt .45, Mr. and Mrs. .357 Magnum. And the shapes on them are the best shapes we have in Babylon to deal with. And you Brothers holdin’ a .357 Magnum in your hand, there ain’t nothin’ that feels like a .357 Magnum, except one of these beautiful black Sisters. But we need them.357 Magnums also.

When we go out there, we’ll be able to protect ourselves. Huey P. Newton issued a mandate a long time ago. It was executive Mandate #3. It said we need to draw the line of demarcation. And when pigs move on our cribs, we have to protect our crib with gun force. Pigs don’t move on Panther cribs. When they move on Panther cribs, they make sure the Panther’s out of town. We had a situation where they moved on a Panther crib and they had three helicopters above his crib. I’m serious, I’m serious. See, they come prepared. Because they know when they comin’ to a Panther’s crib that we might talk a lot of rhetoric, but we deal with the same basic jargon that the people in Babylon deal with. It takes two to tango, motherfucker. As soon as you kick that door down, I have to kick it back to you. We don’t lock our doors. We just get us some good guns and leave them motherfuckers open and when people come in there we put something on them that will make them go to the hardware, buy a lock, come back, pull the door closed, lock it and stay their ass outside!

We’re gonna move as quickly as we possibly can for the people with the questions and answers and the people with the guilt syndrome and the people that have been embarrassed and shamed and disgraced. And we’ve talked about their leaders like LeRoi Jones and Mamalama Karangatang Karenga, a big bald-headed bazoomie as far as we’re concerned. That’s what he is. And we think that if he’s gonna continue to wear dashikis, that he oughta stop wearin’ pants. Cause he’s look a lot better in miniskirts. That’s all a motherfuckin’ man needs in Babylon that ain’t got no gun, and that’s a miniskirt. And maybe he can trick his way out of somethin’. Cause he not gonna shoot his way outta nothin’. He won’t fight temptation, but he never killed anybody but the Black Panther member. Name somebody. Name me a time you read about Karangatang’s office being attacked. The only time he ever had the occasion to use a gun was on Alprentice Bunchy Carter, a revolutionary. This Brother had more revolutionary poetry for a motherfucker than anybody. Revolutionary culture. John Huggins. The only time they lifted a gun was against these people.

As Huey says in prison when they lifted their hands against Bunchy and when they lifted their hands against John, they lifted their hands against the best that Babylon possesses. And you should say that. You should feel anytime when revolutionary Brothers die. You never heard about the Party going around murdering people. You dig what I’m saying? Think about it. I’m not even gonna tell you. You think about it for yourself.

We started the Black Panther Party in 1966. I’m gonna tell you the whole story in a minute. We started dealing with pigs. You think we scared of a few karangatangs, a few chumps, a few male chauvinists? They tell their women “Walk behind me.” The only reason a woman should walk behind a faggot like that is so she can put his foot knee deep in his ass.

We don’t need no culture except revolutionary culture. What we mean by that is a culture that will free you. You heard your Field Lieutenant talking about a fire in the room, didn’t you? What you worry about when you got a fire in this room? You worry about water or escape. You don’t worry about nothin’ else. If you say “What’s your culture during this fire?” “Water, that’s my culture, Brother, that’s my culture.” Because culture’s a thing that keeps you. “What’s your politics?” Escape and water. “What’s your education?” Escape and water. When people ask us about our culture, we say our culture’s guns, baby. Our culture’s revolutionary art, like that. And when you see those two Brothers who picked up them guns and went out into Babylon in ’66 when a lot of us were scared to do anything except lock ourselves up in the closet and listen to Coltrane—ain’t that something for woopin’ a motherfucker’s ass. And this turned us on and this made us black enough that we were bad. Then this made us black enough to get out and launch a blanket indictment at the murder-mouthin’ rest of the black people. Nigger, you ain’t got no natural. Nigger, how come your name ain’t changed? Ask the pigs in California. Ask ‘em. “Who do you fear most? Ron Mamalama Karenga, or Huey P. Newton, who is named after a demagogic, lyin’ politician, Huey P. Long?” And pigs don’t care about that. Because you don’t have to call, if your shotgun’s a Browning, you don’t have to give it no African name, because believe me, it shoots the same. You understand? It shoots the same….

Changing your name is not gonna change our set of arrangements. The only thing that’s gonna change our set of arrangements is what’s gotten us into this set of arrangements. And that’s the oppressor. And it’s on three stages, we call it the three-in-one: avaricious, greedy businessmen; demagogic, lyin’ politicians; and racist, pig fascist, reactionary cops. Until you deal with those three tings, then your set of arrangements will remain the same. The only difference will be that you’re still under fascism, but instead of Fred being under fascism, I’ll be Oogabooga under fascism. But I’ll feel the same. Instead of me goin’ to the gas chamber, I’ll go to an African section of the gas chamber. We so Africanized over here that if Africans came over here, you’d have to give them a catalogue to find out what the fuck they were buyin’. That’s right, you’d have to give them a catalogue to find out what the fuck they were buyin’. You got posters and pictures and names, we’re namin’ things and namin’ ourselves names they never even heard of. And we call ourselves Africanized. And ain’t that somethin’? You understand?

If you’re racist, let me tell you somethin’. Or if you’re a reactionary nationalist. White folks run it. Go to south Africa and ask ‘em. Go ahead. If you want an example of cultural nationalism, the best one I can give you is Papa Doc, Duvalier. In Haiti, all the black people, “We need some black-ness” Papa Doc—naw, Duvalier said “Right on, we need some blackness. Let’s get all the white folks out of here.” Got all the white folks out, and now he’s oppressing all the black folks. When the black folks complain about it, he says, “Well, godamn; what you all complainin’ about now? I’m black. I can’t do nothin’ wrong brother. We already qualified that.” That’s why these apologists like Wesley South come on the air, and to rap that sophistry that the Sister was talkin’ about. Talkin’ about, they’re ballyhooing, really. Just rappin’ about nothin’ because they’re jackanapes in our community allowed to remain there only because of their skin complexion. And we ought to drive them out. Think about it.

You’ve got Bobby Seale chained and gagged at the Federal Building. You’ve got James and Michael Soto who was murdered in two days. By the way, for all you white folks who claim you’re radicals, that claim you’re gonna support the Party. We move in and we’re saying that there’s no better, there’s no higher Marxist than Huey P. Newton. Not Chairman Mao Tse-Tung or anybody else. We’re saying that unless people show us through their social practice that they relate to the struggle in Babylon, that means that they’re not internationalists, that means that they’re not revolutionaries, truly Marxist-Leninist revolutionaries. We look at Kim Il Sung. We look at Comrade the Marshall, Marshall Kim Il Sung of Korea as towering far and high above in his social practice as Mao Tse-Tung. If you can relate to that, cool. If you can’t relate to that, walk out with your as picked clean like the chickens do, you dig? If you can’t relate to that. And we’re tellin’ you that.

And you motherfuckers who think you’re so radical that you’re trying to radicalise everything in Washington. And I don’t know what the fuck you could radicalise, because you ain’t gonna do nothing but walk between the bodies of two dead men, Lincoln and Washington. And I know you’re not gonna stand up and gain no redress. And there’s just as much chance for Nixon giving you some redress. If you can’t get 200,000 people to march on Washington for something that’s in Vietnam, why the fuck can’t you get 200,000 people to come to Jackson and Dearborn, the Federal Building, and march for the Chairman of Babylon, the man who did more for Babylon, and more for Vietnam than you marchin’ maniacs will ever do. Because you’re not doin’ nothin’ for nobody but Florsheims and Stetsons or Stacy Adams and anybody else, because you’re gonna wear your soles out—your metaphysical souls and the soles on your shoes. And we say if you can’t relate to that, then fuck you.

Because our line’s been consistent. We know the Marxist-Leninists. People who might not want to dig on it, they say Marxist-Leninist they don’t curse. This is something we got from slave masters. We know niggers invented the word motherfucker. We wasn’t fuckin’ nobody’s mother. It was the master fuckin’ people’s mothers. We invented the word, you dig? We relate to that. We Marxist-Leninist niggers, and we some Marxist-Leninist cussin’ niggers, and we gonna continue to cuss, godamnit. Cause that’s what we relate to, that’s what’s happening in Babylon. That’s objective reality. Don’t nobody be walkin’ around in Babylon spoutin’ out at the mouth about a whole lot of academic bullshit, intellectually masturbating, catching diarrhea of the mouth. We say to those motherfuckers if you want to catch a mouth disease, you come and talk that shit in a community where the Panthers are at, and you’ll get a mouth disease alright. You’re gonna get hoof-in-mouth; Panther hoof-in-mouth. So if you radicals can’t relate to that, then fuck you, because we know what Chairman Bobby did for the struggle.

And we know that the people in Vietnam, they know that peace, just like Huey P. Newton tells about our motto, that we are the advocates of the abolition of war. We do not want war, but we understand that war can only be abolished through war. That in order to put down the gun, make a man get rid of the gun, it’s necessary to pick up a gun. And you motherfuckers that’s for peace in Vietnam, the Black Panther Party is for victory in Vietnam. We say that they’re aggressors, they’re a bunch of lackey running dogs, that they’re imperialists. They’re a bunch of Wall Street warmongers. And they need to be driven out of there.

And the only way that the liberation of the oppressed people Vietnam or the oppressed people of Babylon’s freedom can be founded, it has to be founded on the land that is fertilized by the bones and blood of these aggressive pig dogs that come into our communities and occupy our communities like troops occupy a foreign territory and go into Vietnam and fight and struggle relentlessly against the people in Vietnam to have a right to self-determination. We don’t care whether anybody likes it or not. That’s our line. It’s a Marxist-Leninist line. It’s consistent. It’s going to remain that way, and it’s been that way.

If you can’t get 200,000 people to come see about Bobby, then we say you’re counter-revolutionary. That what you’re doing is you’re taking some kind of route from DeKalb where you’re going to get to Vietnam without even passing the Henry Horner Projects on the West Side of Chicago. That’s impossible. You think Vietnam is bad? Check the laws. In Vietnam if you lose one son they allow you to keep the other one. They say, “Here, mother dear, hold him—hold him tight.” He can stay at home, you understand. If you have two in there and one dies, they’ll ship him back. They’ll ship him back and get him out of the war where there’ll be no chance of him dying, because “Miss, this war is not going to take both of your sons.” And then you’re marchin’ on this cruel war in Washington, all you radicals, and what about Mrs Soto, who lost two sons in one week? That proves to us through historical fact that Babylon is worse than Vietnam; we need to have some moratoriums on the black community in Babylon and all oppressed communities in Babylon.

And Charles Jackson, from Altgeld Gardens. Last week a 14-year-old boy throwing rocks. The pigs told him to halt, and the motherfucker shot and murdered him. Murdered him in cold blood. And then you motherfuckers got the nerve to go tramping off to Washington, marching between two dead motherfuckers. The Panther Party is going to criticize you motherfuckers. We gonna criticize you out open because we believe in mass revolutionary criticism. We’re gonna tell you that you’re wrong, because we done had a lot of criticism levelled at us for fucking around with you. You will either be part of the problem or you’re gonna be part of the solution. And if we find out you motherfuckers is part of the problem, we’re gonna start turning the guns on you crazy motherfuckers.

We’re gonna have some questions and answers. We’re gonna do one thing, too. And this is another thing out of sight to show the people where we come from. We come from Babylon. The Black Panther Party’s ran solely by black people. If you get a chance—I don’t think it’s gonna be this Sunday, but we taped this Sunday and shown next Sunday, I’m almost sure. It’s gonna be taped this Sunday and shown next Sunday. There’ll be a big round table discussion that’s gonna be on “For Blacks Only”, any you can check the thing and see what it is. And either myself or Chaka will be there. We’ll be presenting the Black Panther Party. And if you get a chance, why don’t you look at it.

If you wanna do something for me, we’d like to do something for Chairman Bobby, if you just clap your hands for me. This is what we call—you don’t have to clap to loud—this is what we call the people beat. It’s a beat that was started in 1966 by Huey Newton and Bobby Seale. It’s a beat that never stops because it’s the beat they got because they knew it couldn’t be stopped. It’s the beat that manifested in you, the people. Chairman Bobby Seale says that as long as there’s black people, there’ll always be the Black Panther Party. But they never can stop the Party unless they stop the beat. As long as you manifest the beat, we can never be stopped. You think the beat is dangerous? We know it’s dangerous. Because when the beat started out on the West Coast, the chief pig out there, Mafioso Alioto, said to the rest of his people that helped him with his fascism out there, he said, “Listen to those people beat. Hey, they’re beating much to fast. Why don’t they go back home where they belong.” When that beat started last November a year ago in Chicago, Illinois, at 2350 W. Madison, when me and Chaka and Bobby Rush and Che and some more Brothers and Jewel got together and said we’re gonna start a Black Panther Party right here. Because this is part of Babylon; the Party exists tight here too. That we might be in school now, might think we’re on the mountain top, but we’re gonna come down to the valley, because people in the valley, commitment’s in the valley, oppression’s in the valley, aggression, repression, fascism, all exists in the valley. No matter how nice it might be on the mountain top, we’ve got a commitment, so we’re going back. We got to go back to the valley.

And when we did that, even Daley and Hanrahan and Judge—we call him Adolph Hitler Hoffman—the chief fascist who knows the art of tapista, the art that Mussolini was supposed to have mastered. We say that Hoffman is better at the art of tapista than Mussolini ever was, because we know what the art of tapista is: it’s an art of good timing. And when we started that beat, Judge Hoffman and Mayor Daley and hammerhead Hanrahan said, “Hey, listen to the people. It’s Chicago beat. Politically they are even beating beating much too fast. Why don’t they go back home?” To live with all black people where they belong, to live in dashikis and bubus and to be porkchop nationalists and cultural nationalists. Why don’t they go back home to thinkin’ what you’re wearin’ is going to change you? Why don’t they go back to “Political power flows from the sleeve of a dashiki.” And we said, No!” As long as that beat continues, we continue, because it gives us in the Party a type of intoxication, that it let’s us understand… we’re so revolutionary proletarian intoxicated that we cannot be astronomically intimidated.

Don’t worry about the Black Panther Party. As long as you keep the beat, we’ll keep on going. If you think that we can be wiped out because they murdered Bobby Hutton and Alprentice Bunchy Carter and John Huggins, you’re wrong. If you think that because Huey was jailed the Party’s gonna stop, you see you’re wrong. If you think because Chairman Bobby was jailed the Party’s gonna stop, you see you’re wrong. If you think because they can jail me you thought the Party was gonna stop, you thought wrong. Because they can “Rage”, Eldridge Cleaver out of the country…you’re wrong. Because we said it before we left and we said it today. That you can jail a revolutionary, but you can’t jail the revolution. You can lock up a freedom fighter like Huey P. Newton, but you can’t lock up freedom fighting. You might hire some pork chops like Mamalama to murder Alprentice Bunchy Carter, a liberator, but you can’t murder liberation, because if you do, you come up with answers that don’t answer, explanations that don’t explain, conclusions that don’t conclude.

We say that if you dare to struggle, than you dare to win. If you dare not to struggle you don’t deserve to win. We wouldn’t go into the ring with Muhammad Ali and not fight and wonder why we lost, would we? If you don’t fight, then you don’t deserve to win. If you don’t move on these fascists, then you’re crazy. We say it’s no longer a question of violence or non-violence. We say it’s a question of resistance to fascism or non-existence within fascism. We say let’s stop the war in Vietnam. Let’s stop it by acquiring victory for the spirit of Ho Chi Minh. We say let’s stop the war in Babylon. Let’s initiate the decentralization of the police….

The only real thing is the people, because pigs bite the hand that feeds them and they need to be slapped. And like Chaka said, when you catch them in you’re house, hit ‘em with anything. You shouldn’t argue about whether to hit ‘em with a chair or a table, because they’re out of order from the start. We say that the oppressor—fuck Judge Taney—the oppressor has no rights which we, the oppressed, are bound to follow.

If you get a chance, come see about Bobby. You oughta come see about Bobby because Bobby came and saw about you. You oughta come see about Bobby because in 1966, when we didn’t even think we were important enough to protect ourselves, Bobby and Huey got their guns and went into the community. They left college. They where pre-engineer students, that was Bobby, and Huey was a pre-law student. And what they read they put into practice. You oughta come see about Bobby because Bobby came and saw about you. I’m gonna see about Bobby and if you have anything to say you’ll come see about Bobby. Come down to Jackson and Dearborn and see about our Chairman, because he’s the Chairman of Babylon. He’s the father and the founder of the breakfast programs and the free health clinics, and there’s nothing wrong, nothing in the world wrong with that.

All power to the people. Northern Illinois power to the people that go here to Northern Illinois University.

We say that we need some guns. There’s nothing wrong with guns in our community, there’s just been a misdistribution of guns in our community. For one reason or another, the pigs have all the guns, so all we have to do is equally distribute them. So if you see one that has a gun and you don’t have one, then when you leave you should have one. They way we’ll be able to deal with things right. I remember looking at T.V. and I found that not only did the pigs not brutalize the people in western days, they had to hire bounty hunters to go arrest them. They shoot somebody with no intention of arresting them. We need some guns. We need some guns. We need some force.

Thank you. I’m going to call Chaka end Sister Joan back up here to deal with any questions that you want answered, because we have plenty of time to spend; we don’t have any time to waste. As the sister said, “Time is short, let’s seize the time.”

Thank you.

"Power Anywhere Where There's People": A Speech by Fred Hampton (1969)

The following is the full transcript of a speech given by Chairman Fred Hampton Sr. at Olivet Baptist Church in Chicago in 1969.

Power anywhere where there's people. Power anywhere where there's people. Let me give you an example of teaching people. Basically, the way they learn is observation and participation. You know a lot of us go around and joke ourselves and believe that the masses have PhDs, but that's not true. And even if they did, it wouldn't make any difference. Because with some things, you have to learn by seeing it or either participating in it. And you know yourselves that there are people walking around your community today that have all types of degrees that should be at this meeting but are not here. Right? Because you can have as many degrees as a thermometer. If you don't have any practice, they you can't walk across the street and chew gum at the same time.

Let me tell you how Huey P. Newton, the leader, the organizer, the founder, the main man of the Black Panther Party, went about it.

The community had a problem out there in California. There was an intersection, a four-way intersection; a lot of people were getting killed, cars running over them, and so the people went down and redressed their grievances to the government. You've done it before. I know you people in the community have. And they came back and the pigs said "No! You can't have any." Oh, they dont usually say you can't have it. They've gotten a little hipper than that now. That's what those degrees on the thermometer will get you. They tell you "Okay, we'll deal with it. Why dont you come back next meeting and waste some time?"

And they get you wound up in an excursion of futility, and you be in a cycle of insaneness, and you be goin' back and goin' back, and goin' back, and goin' back so many times that you're already crazy.

So they tell you, they say, "Okay niggers, what you want?" And they you jump up and you say, "Well, it's been so long, we don't know what we want", and then you walk out of the meeting and you're gone and they say, "Well, you niggers had your chance, didnt you?"

Let me tell you what Huey P. Newton did.

Huey Newton went and got Bobby Seale, the chairman of the Black Panther Party on a national level. Bobby Seale got his 9mm, that's a pistol. Huey P. Newton got his shotgun and got some stop signs and got a hammer. Went down to the intersection, gave his shotgun to Bobby, and Bobby had his 9mm. He said, "You hold this shotgun. Anybody mess with us, blow their brains out." He put those stop signs up.

There were no more accidents, no more problem.

Now they had another situation. That's not that good, you see, because its two people dealing with a problem. Huey Newton and Bobby Seale, no matter how bad they may be, cannot deal with the problem. But let me explain to you who the real heroes are.

Next time, there was a similar situation, another four-way corner. Huey went and got Bobby, went and got his 9mm, got his shotgun, got his hammer and got more stop signs. Placed those stop signs up, gave the shotgun to Bobby, told Bobby "If anybody mess with us while were putting these stop signs up, protect the people and blow their brains out." What did the people do? They observed it again. They participated in it. Next time they had another four-way intersection. Problems there; they had accidents and death. This time, the people in the community went and got their shotguns, got their hammers, got their stop signs.

Now, let me show you how were gonna try to do it in the Black Panther Party here. We just got back from the south side. We went out there. We went out there and we got to arguing with the pigs or the pigs got to arguing-he said, "Well, Chairman Fred, you supposed to be so bad, why dont you go and shoot some of those policemen? You always talking about you got your guns and got this, why dont you go shoot some of them?"

And I've said, "you've just broken a rule. As a matter of fact, even though you have on a uniform it doesn't make me any difference. Because I dont care if you got on nine uniforms, and 100 badges. When you step outside the realm of legality and into the realm of illegality, then I feel that you should be arrested." And I told him, "You being what they call the law of entrapment, you tried to make me do something that was wrong, you encouraged me, you tried to incite me to shoot a pig. And that ain't cool, Brother, you know the law, dont you?"

I told that pig that, I told him "You got a gun, pig?" I told him, "You gotta get your hands up against the wall. We're gonna do what they call a citizens arrest." This fool dont know what this is. I said, "Now you be just as calm as you can and don't make too many quick moves, cause we don't wanna have to hit you."

And I told him like he always told us, I told him, "Well, I'm here to protect you. Don't worry about a thing, 'm here for your benefit." So I sent another Brother to call the pigs. You gotta do that in a citizen's arrest. He called the pigs. Here come the pigs with carbines and shotguns, walkin' out there. They came out there talking about how they're gonna arrest Chairman Fred. And I said, "No fool. This is the man you got to arrest. He's the one that broke the law." And what did they do? They bugged their eyes, and they couldn't stand it. You know what they did? They were so mad, they were so angry that they told me to leave.

And what happened? All those people were out there on 63rd Street. What did they do? They were around there laughing and talking with me while I was making the arrest. They looked at me while I was rapping and heard me while I was rapping. So the next time that the pig comes on 63rd Street, because of the thing that our Minister of Defense calls observation and participation, that pig might be arrested by anybody!

So what did we do? We were out there educating the people. How did we educate them? Basically, the way people learn, by observation and participation. And that's what were trying to do. That's what we got to do here in this community. And a lot of people don't understand, but there's three basic things that you got to do anytime you intend to have yourself a successful revolution.

A lot of people get the word revolution mixed up and they think revolutions a bad word. Revolution is nothing but like having a sore on your body and then you put something on that sore to cure that infection. And Im telling you that were living in an infectious society right now. Im telling you that were living in a sick society. And anybody that endorses integrating into this sick society before its cleaned up is a man whos committing a crime against the people.

If you walk past a hospital room and see a sign that says "Contaminated" and then you try to lead people into that room, either those people are mighty dumb, you understand me, cause if they weren't, they'd tell you that you are an unfair, unjust leader that does not have your followers' interests in mind. And what were saying is simply that leaders have got to become, we've got to start making them accountable for what they do. They're goin' around talking about so-and-so's an Uncle Tom so we're gonna open up a cultural center and teach him what blackness is. And this n****r is more aware than you and me and Malcolm and Martin Luther King and everybody else put together. That's right. They're the ones that are most aware. They're most aware, cause they're the ones that are gonna open up the center. They're gonna tell you where bones come from in Africa that you can't even pronounce the names. Thats right. They'll be telling you about Chaka, the leader of the Bantu freedom fighters, and Jomo Kenyatta, those dingo-dingas. They'll be running all of that down to you. They know about it all. But the point is they do what they're doing because it is beneficial and it is profitable for them.

You see, people get involved in a lot of things that's profitable to them, and we've got to make it less profitable. We've got to make it less beneficial. I'm saying that any program that's brought into our community should be analyzed by the people of that community. It should be analyzed to see that it meets the relevant needs of that community. We don't need no n*****s coming into our community to be having no company to open business for the n*****s. There's too many n*****s in our community that can't get crackers out of the business that they're gonna open.

We got to face some facts. That the masses are poor, that the masses belong to what you call the lower class, and when I talk about the masses, I'm talking about the white masses, I'm talking about the black masses, and the brown masses, and the yellow masses, too. We've got to face the fact that some people say you fight fire best with fire, but we say you put fire out best with water. We say you don't fight racism with racism. We're gonna fight racism with solidarity. We say you don't fight capitalism with no black capitalism; you fight capitalism with socialism.

We ain't gonna fight no reactionary pigs who run up and down the street being reactionary; we're gonna organize and dedicate ourselves to revolutionary political power and teach ourselves the specific needs of resisting the power structure, arm ourselves, and we're gonna fight reactionary pigs with INTERNATIONAL PROLETARIAN REVOLUTION. That's what it has to be. The people have to have the power: it belongs to the people.

We have to understand very clearly that there's a man in our community called a capitalist. Sometimes he's black and sometimes he's white. But that man has to be driven out of our community, because anybody who comes into the community to make profit off the people by exploiting them can be defined as a capitalist. And we don't care how many programs they have, how long a dashiki they have. Because political power does not flow from the sleeve of a dashiki; political power flows from the barrel of a gun. It flows from the barrel of a gun!

A lot of us running around talking about politics don't even know what politics is. Did you ever see something and pull it and you take it as far as you can and it almost outstretches itself and it goes into something else? If you take it so far that it is two things? As a matter of fact, some things if you stretch it so far, it'll be another thing. Did you ever cook something so long that it turns into something else? Ain't that right?

That's what were talking about with politics.

That politics ain't nothing, but if you stretch it so long that it can't go no further, then you know what you got on your hands? You got an antagonistic contradiction. And when you take that contradiction to the highest level and stretch it as far as you can stretch it, you got what you call war. Politics is war without bloodshed, and war is politics with bloodshed. If you don't understand that, you can be a Democrat, Republican, you can be Independent, you can be anything you want to, you ain't nothing.

We don't want any of those n*****s and any of these hunkies and nobody else, radicals or nobody talking about, "I'm on the Independence ticket." That means you sell out the republicans; Independent means you're out for graft and you'll sell out to the highest bidder. You understand?

We want people who want to run on the People's Party, because the people are gonna run it whether they like it or not. The people have proved that they can run it. They run it in China, they're gonna run it right here. They can call it what they want to, they can talk about it. They can call it communism, and think that that's gonna scare somebody, but it ain't gonna scare nobody.

We had the same thing happen out on 37th Road. They came out to 37th road where our Breakfast for children program is, and started getting those women who were kind of older, around 58---that's, you know, I call that older cause Im young. I aint 20, right, right! But you see, they're gonna get them and brainwash them. And you ain't seen nothin till you see one of them beautiful Sisters with their hair kinda startin getting grey, and they ain't got many teeth, and they were tearin' them policemen up! They were tearing em up! The pigs would come up to them and say "You like communism?"

The pigs would come up to them and say, "You scared of communism?" And the Sisters would say, "No scared of it, I ain't never heard of it."

"You like socialism?"

"No scared of it. I ain't never heard of it."

The pigs, they be crackin' up, because they enjoyed seeing these people frightened of these words.

"You like capitalism?"

Yeah, well, that's what I live with. I like it.

"You like the Breakfast For Children program, n****r?"

"Yeah, I like it."

And the pigs say, "Oh-oh." The pigs say, "Well, the Breakfast For Children program is a socialistic program. Its a communistic program."

And the women said, "Well, I tell you what, boy. I've been knowing you since you were knee-high to a grasshopper, n****r. And I don't know if I like communism and I don't know if I like socialism. But I know that that Breakfast For Children program feeds my kids, n****r. And if you put your hands on that Breakfast For Children program, I'm gonna come off this can and I'm gonna beat your ass like a ...."

That's what they be saying. That's what they be saying, and it is a beautiful thing. And that's what the Breakfast For Children program is. A lot of people think it is charity, but what does it do? It takes the people from a stage to another stage. Any program that's revolutionary is an advancing program. Revolution is change. Honey, if you just keep on changing, before you know it, in fact, not even knowing what socialism is, you dont have to know what it is, they're endorsing it, they're participating in it, and they're supporting socialism.

And a lot of people will tell you, way, Well, the people dont have any theory, they need some theory. They need some theory even if they don't have any practice. And the Black Panther Party tells you that if a man tells you that he's the type of man who has you buying candy bars and eating the wrapping and throwing the candy away, he'd have you walking East when you're supposed to be walking West. Its true. If you listen to what the pig says, you be walkin' outside when the sun is shining with your umbrella over your head. And when it's raining youll be goin' outside leaving your umbrella inside. That's right. You gotta get it together. Im saying that's what they have you doing.

Now, what do WE do? We say that the Breakfast For Children program is a socialistic program. It teaches the people basically that by practice, we thought up and let them practice that theory and inspect that theory. What's more important? You learn something just like everybody else.

Let me try to break it down to you.

You say this Brother here goes to school 8 years to be an auto mechanic. And that teacher who used to be an auto mechanic, he tells him, "Well, n****r, you gotta go on what we call on-the-job-training." And he says, "Damn, with all this theory I got, I gotta go to on-the-job-training? What for?"

He said, "On on-the-job-training he works with me. Ive been here for 20 years. When I started work, they didn't even have auto mechanics. I ain't got no theory, I just got a whole bunch of practice."

What happened? A car came in making a whole lot of funny noise. This Brother here go get his book. He on page one, he ain't got to page 200. I'm sitting here listening to the car. He says, "What do you think it is?"

I say, "I think its the carburetor."

He says, "No I don't see anywhere in here where it says a carburetor make no noise like that." And he says, "How do you know its the carburetor?"

I said, "Well, n****r, with all them degrees as many as a thermometer, around 20 years ago, 19 to be exact, I was listening to the same kind of noise. And what I did was I took apart the voltage regulator and it wasn't that. Then I took apart the alternator and it wasn't that. I took apart the generator brushes and it wasn't that. I took apart the generator and it wasn't that. I took apart the generator and it wasn't even that. After I took apart all that I finally got to the carburetor and when I got to the carburetor I found that that's what it was. And I told myself that 'fool, next time you hear this sound you better take apart the carburetor first.'"

How did he learn? He learned through practice.

I dont care how much theory you got, if it don't have any practice applied to it, then that theory happens to be irrelevant. Right? Any theory you get, practice it. And when you practice it you make some mistakes. When you make a mistake, you correct that theory, and then it will be corrected theory that will be able to be applied and used in any situation. Thats what we've got to be able to do.

Every time I speak in a church I always try to say something, you know, about Martin Luther King. I have a lot of respect for Martin Luther King. I think he was one of the greatest orators that the country ever produced. And I listened to anyone who speaks well, because I like to listen to that. Martin Luther King said that it might look dark sometime, and it might look dark over here on the North Side. Maybe you thought the room was going to be packed with people and maybe you thought you might have to turn some people away and you might not have enough people here. Maybe some of the people you think should be here are not here and you think that, well if they're not here then it won't be as good as we thought it could have been. And maybe you thought that you need more people here than you have here. Maybe you think that the pigs are going to be able to pressure you and put enough pressure to squash your movement even before it starts. But Martin Luther King said that he heard somewhere that only when it is dark enough can you see the stars. And we're not worried about it being dark. He said that the arm of the moral universe is long, but it bends toward heaven.

We got Huey P. Newton in jail, and Eldridge Cleaver underground. And Alprentice Bunchy Carter has been murdered; Bobby Hutton and John Huggins been murdered. And a lot of people think that the Black Panther Party in a sense is giving up. But let us say this: That we've made the kind of commitment to the people that hardly anyone else has ever made.

We have decided that although some of us come from what some of you would call petty-bourgeois families, though some of us could be in a sense on what you call the mountaintop. We could be integrated into the society working with people that we may never have a chance to work with. Maybe we could be on the mountaintop and maybe we wouldn't have to be hidin' when we go to speak places like this. Maybe we wouldn't have to worry about court cases and going to jail and being sick. We say that even though all of those luxuries exist on the mountaintop, we understand that you people and your problems are right here in the valley.

We in the Black Panther Party, because of our dedication and understanding, went into the valley knowing that the people are in the valley, knowing that our plight is the same plight as the people in the valley, knowing that our enemies are on the mountain, to our friends are in the valley, and even though its nice to be on the mountaintop, we're going back to the valley. Because we understand that there's work to be done in the valley, and when we get through with this work in the valley, then we got to go to the mountaintop. We're going to the mountaintop because there's a motherfucker on the mountaintop that's playing King, and he's been bullshitting us. And weve got to go up on the mountain top not for the purpose of living his life style and living like he lives. We've got to go up on the mountain top to make this motherfucker understand, goddamnit, that we are coming from the valley!

COVID-19, Marxism, and the Metabolic Rift

By Sagar Sanyal

Originally published at Red Flag.

The COVID-19 pandemic is far from a purely natural occurrence. Respiratory viruses like SARS-CoV-2 (the virus that causes COVID-19) that exist in populations of birds and various mammals such as pigs, horses, cows and humans, are nothing new. But the circulation of these viruses between species, and the frequency of viruses spreading from animals to humans, has increased in recent decades, and changes in the relationship between human society and nature have been the main driver of this.

The origin of COVID-19 and the vector for its spread to humans are still under investigation by scientists. The closest variant of the virus has been identified in bats, and it’s possible it was transmitted to humans through wild meat or bush meat markets, perhaps via pangolins. Whatever the exact origin and vector, however, the jump from animals to humans fits a familiar pattern, one long understood by epidemiologists.

The destruction of nature by capitalist industry plays a big part. As forests and other areas untouched by human development are destroyed, wild species like bats are forced out to forage for food in urban centers. Those wild species carry diseases that previously remained confined to forests and only rarely infected humans – never enough to cause an epidemic. But now this migrating wildlife comes into more frequent contact with large human populations. Sneezes and droppings from wild animals spread the virus to other animals that humans handle more often – like pigs, chickens or, as with the MERS outbreak in the Middle East a decade ago, camels.

Evolutionary biologist Rob Wallace, author of Big Farms Make Big Flu: Dispatches on Influenza, Agribusiness, and the Nature of Science, is among the writers who for years have warned of the increasing likelihood of such epidemics. On COVID-19 specifically, Wallace and his collaborators emphasize how the wild meat sector fits into the broader context of industrial food production. “How did the exotic food sector arrive”, he asks, “at a standing where it could sell its wares alongside more traditional livestock in the largest market in Wuhan? The animals were not being sold off the back of a truck or in an alleyway”.

Increasingly, according to Wallace, wild food is being integrated into the mainstream of the capitalist food market. “The overlapping economic geography”, he writes, “extends back from the Wuhan market to the hinterlands where exotic and traditional foods are raised by operations bordering the edge of a contracting wilderness. As industrial production encroaches on the last of the forest, wild food operations must cut farther in to raise their delicacies or raid the last stands”.

Right wing news outlets more interested in racist scapegoating than in facts made a big deal of the wild meat issue, as if the world would have been spared the virus if only Chinese consumers had stuck to eating chicken or pork. But that is a false narrative. Since the 1990s, several deadly strains of bird flu and swine flu have developed and spread from industrial farms of chickens or pigs, including in North America and Europe, as well as in China.  

It has long been understood why these places breed disease. The animals are crowded into feedlots under conditions that run down their immune systems. The genetic monoculture of these populations takes away the natural diversity that reduces the prevalence of diseases. As farmers try to minimize time from birth to slaughter, this has the perverse consequence of acting as a natural selection pressure for pathogens that can survive more robust immune systems. All these things mean diseases can spread very fast within industrial herds and flocks. The cost cutting imperative means that work conditions (like protective equipment) are so poor that farm laborers are highly vulnerable to catching viruses from these animals.

The danger to humanity from such practices was reinforced in June, when scientists discovered a number of new strains of swine flu with pandemic potential circulating among pigs on farms in China. Although the strains, collectively referred to as G4 viruses, don’t appear currently to be able to spread between humans, around 10 percent of blood samples taken from farm laborers showed evidence of prior infection. All it would take is a small mutation and one or other of these viruses could start jumping from human to human and spread rapidly through the broader population, just as has occurred with SARS-CoV-2.

Marx and Engels’ groundbreaking work on the relationship between human society and nature in the context of the emergence of capitalism as a global system in the 19th century can help us understand the destructive dynamics underlying these developments. Central to their work in this area was the idea of the “metabolic rift”. All living things have a metabolic relation with their ecological surroundings, taking in certain things and putting out waste. When it comes to humans, Marx and Engels noted that our metabolism with the rest of nature is not due to our biology alone, but also to the kind of society we’ve built. To understand human metabolism with nature, we thus need social science in addition to natural science.

The metabolic rift has both historical and theoretical aspects. On the historical side is the displacement of peasants and peasant farming methods from the countryside, and their corralling into towns to create the modern working class. Workers, unlike the peasantry, had no means of livelihood of their own, and therefore had to move around to find waged work, crowding into the cities where that work was concentrated. One consequence of this was that, instead of being reabsorbed back into the local environment, human waste now collected in vast pools in the cities.

This process was the main driver of the soil fertility crisis that struck Europe in the late 19th century. By displacing the peasantry, and forcing more and more people into the cities, capitalism, Marx wrote, “disturbs the metabolic interaction between man and the earth, i.e. it prevents the return to the soil of its constituent elements consumed by man in the form of food and clothing; hence it hinders the operation of the eternal natural condition for the lasting fertility of the soil”.

What about the theoretical aspect? The rift isn’t just about the natural effects they observed, but also their social cause. It is a rift in social relations: the forcible conversion of a peasantry into the modern working class.

Peasants farmed a plot of land to which they had customary right over generations. They controlled their own labor process, and this meant there was a feedback mechanism between their labor and its effects on the land. If they depleted the soil and thus threatened their livelihood, they could adjust their methods of work accordingly. Peasant farmers had, over many generations, developed practices to maintain soil fertility through crop rotation, cycling between crops and pasture to ensure manuring, and returning human excrement to the fields. Peasant methods of labor were the main factor in the metabolism between feudal society and the rest of nature. Feudal lords would leave peasants to farm as they wished, then take a portion of the produce.

By contrast, the capitalist mode of production involves the capitalist dictating the labor process, and then just hiring laborers to do what they are told. As capitalist farmers emerged, they realized more money was to be made by cutting out the aspects of peasant farming practices that had no immediate pay-off (even though they maintained soil fertility) and focusing just on the highest earning aspects.

Around the same time the first factories were bmetabloismeing established in towns, and the emerging capitalist class and the state that served them realized that wages could be forced down if large masses of former peasants were concentrated in a handful of industrial areas rather than scattered across a large number of small population centers. During the 18th and 19th centuries, vast numbers of peasants were driven from the land by a combination of brute force and legal changes (such as the Enclosure Acts). Out of this uprooted peasantry, the modern working class was born.

A new dynamic began to shape social metabolism with nature. Unlike the peasants who worked the land directly, capitalist farmers and the new captains of industry were far removed from the destructive consequences of their activities. So long as they had workers prepared to exchange their labor for a wage (and the desperate poverty in which most people lived ensured that there was no shortage), they could turn a profit, even if their actions were detrimental to the natural world on which their business ultimately depended. If they destroyed the land, they could use the profits they had made to buy more land elsewhere. More often, however, the destructive consequences of their activities were simply externalized – the poisoning of the air and water in factory districts, which had a major impact on the lives of workers in this period, provides a clear example.

From this point on, what was produced in society and through which methods was determined by the profit motive and competition among rival capitalists and nation-states. The impact of production on the natural world became, at best, an afterthought. A new dynamic was driving society’s metabolism with nature – one that would create environmental disasters on an ever widening scale.

Scientists who study the origins of diseases have been telling us for decades that we will continue to have outbreaks of novel viruses that hop from other animals to humans because of how we farm animals and how we destroy wilderness. This advice is ignored, just as the advice of climate scientists is ignored, because acting on it would require breaking from the profit-driven logic of capitalism.

Where it’s a choice between booking short-term profits and taking a hit to profit to address potentially destructive consequences in the longer term, capitalists will always put profit first. They, after all, can escape the consequences of their actions. They spend their days in air conditioned offices, unlike the farm laborers who spend their days surrounded by hundreds of pigs riddled with swine flu. In a pandemic, capitalists can hide away in their country mansions and, in the event that they fall ill, can pay for the very best of medical care.

For workers it’s a different story. We’re the ones on the front lines of the battle against COVID-19, not through our own free choice, but through economic necessity. For the vast majority of workers around the world, stopping work isn’t an option. We must work to survive, even if in doing so we are actually putting our lives at risk. This suits the capitalists very nicely. The COVID-19 pandemic arrived at a moment when the world economy was already struggling. The ruling class, whether in Australia, the US or any other country, is desperate to limit the economic damage from the crisis, even if that means many more people will die.

If workers ran the world, it would be very different. It would make no sense for us to ignore the warnings of scientists about how industrial agriculture and environmental destruction are fueling the emergence of new diseases, for the simple reason that we’re the ones who will suffer when they appear. We don’t have a stake in the relentless scramble for short-term profit that defines capitalism today. We can organize production – both what we produce and how we produce – with human health and environmental sustainability in mind.

In the current pandemic, that might mean shutting down all but the most essential parts of the economy to slow the spread of the virus, while ensuring other workers are paid to stay home. In the longer term, it would mean reshaping animal agriculture to limit the potential for it to function as a petri dish for the emergence of deadly diseases.

This is how Marx envisaged the metabolic rift being healed. “Freedom in this field”, he wrote in volume 3 of Capital, “can only consist in socialized man, the associated producers, rationally regulating their interchange with nature, bringing it under their common control, instead of being ruled by it as by the blind forces of nature; and achieving this with the least expenditure of energy and under conditions most favorable to, and worthy of, their human nature”.

Such freedom will never exist under a capitalist system in which the drive to profit rules. The first step in fixing the metabolic rift is to make our labor our own again. That means taking it back from the ruling class.

Working From Home: The Silver Lining of the COVID-19 Pandemic

[Image Credit: Alessandro Massimiliano/ Getty Images]

By Cherise Charleswell

During this unprecedented global coronavirus pandemic there has been a great deal of uncertainty, hardships, frustration, and unfortunately – loss of loved ones, so it makes it exceptionally difficult to recognize any positivity during these trying times. As our existence becomes more and more precarious, and it feels like we are failing miserably on this team assignment to combat this virus and slow the spread of infection, I want to point out a sliver of hope, and the silver lining that has come out of this pandemic.

To truly understand what I’m going to share please consider one of the main reasons why the COVID-19 pandemic is unprecedented. This has to do with the fact that we, our global community, all homo sapiens are more connected than we have been during any other time in human history. In a sense, globalization has been completed. We can board a plane and get to the most remote parts of the world within hours, use high speed rail (outside of the United States, of course, because our infrastructure is poorly lacking) and crisscross a country within hours, and there are many far flung Diasporas where certain groups, whether identified by nationality, race, or ethnicity, can be found in parts of the world that is a great distance from their country/region of origin.

And there is no doubt that we’ve benefited from this connectedness.  We’ve benefited in terms of learning about different cultures, tasting and falling in love with various cuisines, establishing meaningful friendships, and we could only hope, that we’ve learned more about tolerance, respect for others, and the importance of upholding human rights across the world.

Unfortunately, at this time, we are losing the Microbial Arms Race, which is a war that began with our early human ancestors and involves a competition between humans and microbes; where microbes are constantly adapting (mutating) to overcome barriers to their ability to infect our bodies. These barriers have include the complexity and evolutionary adaptability of our own immune systems, improved sanitation practices, as well as the use of vaccines and drugs/therapeutics. One of the most well-known “superbugs” is methicillin-resistant Staphylococcus aureus (MRSA), an especially difficult-to-treat variety of the disease-causing bacteria staph. MRSA and other antibiotic-resistant bacteria stand proof that bacteria have learned to outsmart us much faster than we can invent new treatments.

Our current connectedness and exploitation of the planet, uncovering unknown microbes for which we do not have any immunity, only exacerbates the situation, and has helped to fuel this pandemic. And it truly seems like the microbes are winning, as borders are closing – forcing  us to disconnect, and we have to cope with the reality that we are without immunity or any natural defense against COVID-19.

So, where is the silver lining?

It’s faint, but it’s there. And one place to find it, is when we look at the way that “working from home”  or “remotely” has helped to not only transform the lives of workers, and the dynamics of communities, but how this transition has positively impacted the planet.While we spend so much time focused on the microscopic organism and its threat, we must not forget the fact that we all call Earth home, and as Astronomer, cosmologist, astrophysicist, astrobiologist, author, and lecturer Carl Sagan stated, this “Pale Blue Dot” is home to all of us, all life forms, and it is the only place in the known universe that we can inhabit. Unfortunately and despite, knowing that we have no other planet or place to go, we’ve continued to harm and destroy this planet.

Prior to the COVID19 pandemic scientists had estimated that we had only 11 years left (as in until 2030) before we will have to cope with the devastating effects of global warming and climate degradation. Swedish teen activist Greta Thunberg who has been afforded the most attention by the international press, and other young activists, such as Isra Hirsi, Autumn Peltier, Bruno Rodriguez, Helena Gualinga, Mary Copeny, Delaney Reynolds, Kisha Erah Muana, Alexandria Villasenor, Vic Barrett, Katie Eder, have also been beating the drum, demanding climate action, and fighting for their, and our right to have a future. Seriously, as a Millennial, I would like to be able to live into my “Golden Years”!

For the young activists and other people from the Global south, island nations, and other nations at or below sea level, the situation is even more dire. Their lives, and my own family’s lives, will be impacted more greatly; and this includes the complete loss of homeland. Countries such as Kirbati in the South Pacific have actually already begun the process of vacating their island-nation, and re-settling it’s citizens. The worse and most ironic part about all of this is that those living in the Global South and marginalized people all around the world, hold the least responsibility for climate change and environmental degradation.  What is taking place is the result of the actions of people living in the “West”, more affluent nations, and their multinational corporations. These nations have built their wealth off of raping and exploitation of peoples and the very planet that we live on. All for manufactured wealth and profit. Not realizing that our greatest form of wealth has been this planet.

In short, capitalism and hyper-consumerism are leading us to the apocalypse.

So, let’s focus on some of the positive that COVID-19 and the resultant millions of people who no longer commute daily, no longer piling onto congested highways, and instead are working from home has done for the planet:

Internationally, the levels of air pollution has declined since early March when lockdown directives really began to go into effect. This is being tracked and confirmed by the number of nitrogen dioxide (NO2) emissions in the air; with NO2 being a marker of pollution.

The earth has gone quiet! Seismologist and other researchers have reported that there has been a noted drop in seismic noise, which could be the result of transport networks and other human activities being shut down.

More about the environmental benefits here, here, and here.

When you consider all of this it would seem like Mother Earth is healing, and we must really take some time to appreciate the fact, that we are witnessing the reversal of centuries of destruction, in merely a few  months’ time. That this small pause in destructive human activity, is all the earth needed to begin healing again.We must remember this, and realize that we have been presented with a great opportunity, and cannot go back to what we’ve been doing before.

It is no longer about surviving a virus, but surviving as a species, period.

The increase in the number of people working from home globally, has created this silver-lining.

I would like to present Six Shades of Silver to consider. These are the environmental and social benefits of having more people work from home:

1. Environmental Protection: Less traffic, less utilization of gasoline, and a sharp reduction in all forms of commuting has without a doubt provided a benefit to the planet. Also, the fact that the “Outdoors” seem to be the only thing currently accessible “Outside” means that there are more people interested in exploring and preserving national parks, hiking trails, and other natural environments that they may have not visited before.

2. No Bedroom Communities - When one really thinks about it, it didn’t really make any sense to force the majority of workers to pile into their cars, generally head in the same direction, and across overburdened  roads and highways, to join a slow procession of cars; in order to trade their labor for pay/wages. We can immediately do away with the phrase “rush hour” by increasing the number of remote workers.

   With remote work, more workers could opt to move away from over crowded urban centers and this may offer the benefit of not only improving quality of life, but may help to reduce homelessness, particularly in urban areas, where many find themselves residing in because of the proximity to jobs. Leaving housing in these areas, such as San Francisco, Los Angeles, New York, Boston, Washington D. C. limited and thus unaffordable.

   Let’s talk more about the lives of people who would no longer have to live in “bedroom communities” and who would instead be able to live in affordable, less congested, greener, and thriving communities that are located at a distance from urban centers. Rather than awaking at some ridiculous time in the morning in order to sit for an hour or more in traffic, and essentially abandon their communities until nightfall. These workers will have an opportunity to be active members of their communities and these communities won’t be deserted towns for most of the day.

   Non-commuting workers would have more time to spend with their children and families, to get out-and-about in their neighborhood, take a walk along a trail (a physical and mental health benefit that can increase longevity), prepare nutritious meals for breakfast and lunch rather than relying on eating snacks, junk food, and fast-food in a hurry at their desk or in their car during their commute. And working in the community that one lives means that there is a greater  opportunity to build bonds with neighbors and patronize local businesses. Retaining the workers who are often gone for 10-12 hours a day, 5 days a week, means that these communities will truly be able to “come to life”.

3. Less Office Space/More Affordable Housing: Homelessness is a manufactured phenomenon. One that is brought about by accepted socioeconomic & political systems, such as capitalism, policies, and social norms. There is truly enough “room” or space to effectively provide shelter to all people on this planet. We simply do not do so, because we place more value on land and land use than we do on lives. This is why it is not uncommon to find buildings, houses, and other housing units sitting unoccupied in cities that have extreme problems with homelessness.

   Homelessness and poverty are inextricably linked. Poor people are frequently unable to pay for housing, food, childcare, utilities (heating & electricity) health care, and education. Leaving them with difficult choices to make when limited resources cover only some of these necessities. Often it is housing, which absorbs a high proportion of income that must be dropped. If you are poor, you are essentially an illness, an accident, a paycheck, and now a pandemic away from living on the streets.

   With the mass loss of jobs and the resultant unemployment and underemployment of workers, the COVID-19 pandemic is providing an opportunity to re-think, or finally admit that there is a problem in believing that some people are more deserving of housing than others. As we talk about stopping evictions of workers and business owners, we should also consider those who were not only evicted, but forced out of their homes due to increasing economic inequity and poverty and the lack of affordable housing prior to the COVID-19 pandemic. The current alarming rates of homelessness that we see with 2019 estimates being that 567,715 Americans experience homelessness on a single  night, have been growing over the past 40 years, and has been tied to the erosion of the  middle class, the massive transfer of wealth from workers to the 1%,  economic inequity - with 20% of families making more than half of all U.S. income, stagnant wages, and the exponential  growth in the cost of housing. Reagan’s trickle down economy was a trick, and no one knows  this more than those of us born during and after the Reagan era. We are the first generation in  American history to have a quality of life that is far worse off than the previous generation.

   With an increase in the number of workers working from  home, we can begin considering converting office spaces to residential use, and/or halting the  development of even more office buildings, and focus on building more affordable housing.  Further, “affordable” housing shouldn’t be something that is made available to workers living  well below the poverty line. We need to think of affordable housing in terms of something that  is accessible to the average worker. So, it is not about creating a program, checking eligibility,  and having social workers visit families placed in affordable units, its more about having enough  available units and homes that can be afforded by (meaning not costing more than 30-40% of  their salary) people making the median salary/wage in a city or county. “Affordable housing” truly needs to signify being able to afford to pay the rent or mortgage on a home based on one’s current wages.

4. Families and Childcare: While most women are active members of the global workforce. Out of the world’s 197 countries, the United States and Papua New Guinea are the only countries that have no federally mandated policy to provide new mothers with paid time off. Policies, provision, and management of maternity leave is left up to states and individual employers. And the time off provided to expectant and new mothers in the United States pales in comparison to maternity leave in other countries. For example, in the “progressive” state of California, mothers can typically take up 12 weeks to bond with their child; and are expected to return back to work while their child is still an infant. In the United States paternity leave is nonexistent and quality childcare is extremely expensive.

   Remote work can decrease or eliminate these financial and logistical burdens for families, and allow time for more critical bonding between parent and child(ren). This is especially true when you consider getting back all of the time loss to commuting, which often leaves parents and their children with very limited time to actually interact before bedtime and preparation for the next day. Flexible work from home schedules means that parents can begin working earlier in the day, resume work later in the evening, or even take off a Wednesday, and catch up on work on a Sunday. The silver-lining is that working parents do not have to choose between being professionals, breadwinners, and having a presence in their child(ren)’s lives.

5. Less Commuting, Coworkers Coughing, & the Potential To Contract Communicable Diseases: We all have our “war stories” where we arm ourselves with lysol, sanitizer, tissue boxes, etc. and enter our places of work, knowing that there would be many sick and infectious people passing by and working in close proximity. We avoid shaking hands, ask people not to use the phones on our desks, and begin to bob-and-weave the minute that we hear someone coughing. And we did all of this long before COVID-19. We did this because we knew that entering our crowded workplaces, particularly office buildings & warehouses where windows don’t open, and doors remain close for the most of the day, meant that it was likely for us to contract a disease, whether it be the common cold, flu; or more serious diseases such as meningitis or tuberculosis; which can readily spread in a workplace setting.Therefore, there can only be a benefit of decrease interactions with coworkers, collaborators, clients, and others; particularly during Flu season.

6. Improved Work-Life Balance: Working from home not only allows a worker to save money, due to less of a need for gasoline or eating out for lunch, it further improves the work-life balance by providing workers more time for their families, for themselves, for rest (sleeping in rather than having to rush to catch a bus, train, or battle traffic), to workout, do yoga, meditate, and cook healthy meals. It allows them to actively implement self care into their daily routine rather than make it something that has to be planned for and scheduled by appointment. Far more can be accomplished when preparing for work, going to work, and actually working doesn’t take up 40-50% of the day or a 24 hours period.

The Need To Transform The Workplace

The COVID-19 pandemic has made, or should’ve made it clear to many employers that their businesses and/or organizations can continue to operate with their workers or most of their workers working remotely. This is why the job advertisements that state “temporary remote” really are nonsensical. If that position can be carried out by a remote worker for the unforeseeable future, as we wait for this pandemic to wane, why should the worker in that position return to working onsite?

Employers have to get out of the outdated view of employees as children who need to be micromanaged by babysitters (managers and supervisors) who glare at them through their office windows or as they sit in crammed cubicles. This need to supervise not only the output of workers, but also their movement, truly harkens back to the practice of blocking exits that was once utilized in the workplace prior to the infamous Triangle Shirtwaist Factory fire that took place in Manhattan’s Greenwich Village in 1911. On that day 150 garment workers who were mostly women and immigrants were trapped and killed when the building caught fire, and all exits remained blocked. A number of the women were photographed as they attempted to flee the building by jumping through the windows, and falling to their death. This horrific incident was witnessed by Frances Perkins, a sociologist, workers-rights advocate and the first women to be appointed to the U.S. Cabinet; where she served as the Secretary of Labor from 1933 to 1945, under President Theodore Roosevelt. Frances championed the cause of The Fair Labor Standards Act of 1938. The FLSA required that employers pay overtime to all employees who worked more than 44 hours a week, and by 1940 the 40-hour work week became U.S. law.

Henry Ford and his Ford Motor Company actually began popularizing the 40-hour work week prior to this landmark legislation, in 1914, after research confirmed his belief that working more yielded only a small increase in productivity that lasted a short period of time; hence too many hours of work were bad for worker’s productivity and a company’s profitability. 

When it comes to this continued need or desire to “babysit” that some employers have, one has to ask - Why go through the process of searching for the best educated, experienced, and professional job candidates, if you are going to treat them like children who are unable to set priorities and manage their own schedules?

We are long overdue for a Labor revolution, and the COVID-19 pandemic has only helped to illuminate this fact. It has forced us to rethink where, how, and when we work; as well as what & how much we are willing to sacrifice when we trade our time for wages. We should take the opportunity presented by the pandemic to make changes that match the current needs, lifestyle, and realities of the 21st century worker. The re-establishment and/or support of labor unions will be needed to usher in this change.

Transitioning workers whose jobs are performed in an office setting, using a computer, etc. to remote workers, should be a part of this Labor revolution. Remote work provides the opportunity to shift the focus of work from the amount of time dedicated to work, to confirming whether tasks and assignments are completed. With task-based work, workers are provided with far more flexibility and freedoms; especially since there is less emphasis on the time of day, or days that they work. And this is something that employers really need to consider, because forcing people to sit at a desk for 8 consecutive hours does not guarantee that they are going to spend all of that time working. Instead, they are likely to attempt to get other things accomplished during that time, whether it is taking an extending lunch in order to make a medical appointment, checking personal emails, responding to texts from family and friends, surfing social media, paying their bills online, getting caught up on gossip near a water cooler, or taking multiple informal breaks to grab coffee or tea, walk, stretch, and think; because it is truly difficult for human beings to sit still and stare at a screen for long periods.

Our bodies didn’t evolve to sustain this sedentary lifestyle. All of this again, makes the focus on how worker’s spend their time futile, and far from a true measure of productivity.

A 2014 report from AtTask shared the following response from 268 workers about how they typically spent their 8-hour work days:

• 45% of the time was spent on primary job duties

• 40% of the time was spent on meetings, administrative tasks, and “interruptions”

• 14% of the time was spent responding to emails

Remote Work Also Offers Benefits To Employers

Here is a short list of benefits of remote work that employers should take the time to contemplate:

1. Research has shown that engaged remote workers are more productive. And this productivity could also be contributed to having a healthier workforce where worker’s had more time for physical activity and where there were no concerns about spread of infectious agents, resulting in many workers having to take sick days.

2. There are obvious cost-saving benefits to having employees work from home, and this includes less overheard expenses in form of office space leases, furniture, security, as well as utility costs. Outside of payroll and fringe benefits the other major expenses would only be providing employees with technology (computers, printers, web conference logins, etc.) and supplies to utilize at home to perform their jobs.

3. Meetings would be fewer, shorter, and more meaningful. In person meetings tend to involve lots of casual banter, and may be used by people to lodge complaints and personal grievances that only involve few people in the meeting. When it comes to remote meetings, there is more of a desire and incentive to use the allocated time more wisely, which means stay on task and get through the agenda. There are already jokes about being “Zoomed out”, and this has led to more focused meanings and less frequent meetings. And remote work doesn’t have to mean the end of in person meetings, in a post-covid world, these types of meetings could always be arranged at local restaurants, cafes, coffee shops, or even in rental office and co-working  spaces; book through sites such as peerspace.com, easyoffice.com, or liquidspace.com.

4. Employers will be able to use the cost savings to reinvest in the company, expand the organization and increase capacity, maximize profits, or increase employee salaries in order to retain the most productive and effective workers, but also attract additional talent.

5. With remote work, employers can literally cast their nets wider and further, and tap into a larger pool of talented, educated, and experienced job candidates, rather than being limited by geographic location. More about how remote work attracts and retains top talent here.

The Reality

Our professions are greatly varied, so the reality is that not all workers will be able to transition to remote work, and this includes those deemed to be essential workers - who work in health care, agriculture, food service (especially supermarkets), law enforcement, fire, and first responders, construction workers, entertainers and athletes, and those working in human services; as well as workers in the service industries - cosmetologists, barbers, masseuses, and so on.

However, the COVID-19 pandemic has proven that many jobs can transition to a remote model quickly and efficiently , and these are the positions that we should focus on, because there are great benefits to the planet, to individual workers, to families, to communities, and even the companies when these workers stay home.

Finally, the best way to be prepared for and combat the next pandemic, or ensure that our planet remains habitable to human life, is by embarking on this radical change to the “workplace”. Like that of the early 20th Century, The 21st Century Labor Revolution is a matter of life and death.

Let’s stay home.

Cherise Charleswell is an unapologetic Black feminist, author/writer, poet, public health researcher/practitioner, radio personality, social critic, political commentator, independent scholar, activist, entrepreneur, and model who doesn’t believe in thinking or staying in one box. She is also a Founding member of The Hampton Institute and remains in an Advisory position. Her work has been published in various magazines, textbooks and  anthologies, websites, and academic journals; including The Hampton Institute: A Working Class Think Tank, New Politics, For Harriet, Black Women Unchecked, Zocalo The Public Square, Truth Out, Rewind & Come Again, Natural Woman Magazine, Kamoy Magazine, New Republic, Blue Stocking Magazine, Broad A Feminist & Social Justice Magazine, Obsidian Magazine, AWID Young Feminist Wire, Afro City Magazine, Role Reboot, Code Red for Gender Justice, Kalyani Magazine, Interviewing The Caribbean, TruthOut, Our Legacy Magazine, and Rival Magazine Los Angeles.

Cherise is of West Indian descent, with heritage from various Caribbean islands, & is an avid world traveler, visiting over 30 countries and counting. She can’t wait for Da’ Rona to go away so she can get back to traveling.

Firm Level Price Determination: A Comparison of Theories (Perfect Competition, Imperfect Competition, and the Theory of Real Competition)

By Ezra Pugh

“The best of all monopoly profits is a peaceful life,” (John Hicks, 1935).

“The division of labor within society brings into contact independent producers of commodities, who acknowledge no authority other than that of competition…the ‘war of all against all,’”      (Karl Marx, 1867)

George Stigler defines the term competition as “the absence of monopoly power in a market,” (Stigler 1957, 14). This could seem a curiously narrow definition to the businessperson or the worker. But this notion has been ubiquitous in the teaching of economics for decades. It originates, of course, from the Neo-Classical theory of perfect competition. Abstraction is necessary to any theoretical investigation. Assumptions must be made for the purpose of conducting analysis. But in flattening the meaning of a term like competition in such a way, is there a risk that some essential insights may be lost?

Perfect Competition

Perfect competition is the foundational parable of orthodox economics. A perfectly competitive market is an abstract ideal with a number of specific attributes:

•          There is a very large number of firms, such that no single firm can affect the overall market for its product.

•          There is a very large number of buyers for the industry’s product.

•          Each firm produces exactly the same undifferentiated product.

•          Firms, and their consumers, have perfect knowledge of all relevant economic information related to their industry and its product.

•          Firms have unrestricted power of entry and exit in their industry.

•          Firms are entitled to a ‘normal rate’ of profit, which is included in its operations costs.

• ·         Marginal costs drop at first then eventually increase with each unit sold. As a result, average cost is also upward sloping.

From its perspective, a firm in perfect competition is just a speck, dwarfed by the size of the market it competes in. The market can absorb whatever the firm can produce, provided it is sold at market price. The firm’s perceived demand curve is horizontal, or perfectly elastic. As a result, the demand curve is identical to its supply curve. The overall demand curve of the market, however, is downward sloping.

The firm must accept the prevailing market selling price for its good. If it sets its price above the prevailing price, even by an iota, the firm will lose all of its sales to the myriad other sellers. If it sets its price below, it will not be able to make enough profit to survive. A firm in a perfectly competitive market is therefore known as a price-taker, as it is powerless in the face of market pressures. Consequently, “a perfectly competitive firm has only one major decision to make—namely, what quantity to produce,” (Greenlaw 2018, 189).

Being rational, the firm’s motivating goal is to generate profit. Its profit (r), is defined as total revenue (TR) minus total cost (TC). Total revenue is made up on the products price (P) multiplied by the quantity produced (Q) minus the average cost per unit (AC) multiplied by the quantity produced. This can be written as:

To maximize its profit, the firm must continue producing more output up until the point its marginal revenue equals its marginal cost – the point where an additional unit of output contributes no more profit. Marginal revenue (MR) and marginal cost (MC) are defined thus:

Because the market price the firm experiences does not change based on its output, the firm’s marginal revenue is a constant. Each additional unit sold adds the same value, which is equal to the price of the product. If marginal revenue is equal to price, and profit maximization occurs when marginal revenue equals marginal cost, the firm should produce up until the point where its marginal costs equals the price of its product.

The firm’s average cost is its total cost divided by quantity produced, and is assumed to initially fall then eventually be upward sloping. Because innumerable sellers all sell the same good, in the long run (which generally does not have a specific definition), all ‘economic’ profits—those which are above the assumed ‘normal’ profits—are eventually eroded completely away. If positive economic profits existed, more firms would enter the market, increasing supply and lowering price. If economic profits are negative, firms would leave the market, causing the opposite effect. As a result, in the long run perfect competition causes sellers to produce their goods at the lowest point on their average cost curve.

“When profit-maximizing firms in perfectly competitive markets combine with utility-maximizing consumers, something remarkable happens,” we are told, “the resulting quantities of outputs of goods and services demonstrate both productive and allocative efficiency,” (Greenlaw 2018, 206). Productive efficiency is attained because in the long run, firms produce at their absolute lowest cost. Allocative efficiency is achieved because the resulting goods’ price is equal to its marginal cost—precisely the value of the ‘social cost’ of producing it.

Imperfect Competition and Monopoly

But of course, this state of affairs does not resemble the world in which we live. This utopian optimality, we are told, is distorted and mutated by the anti-competitive behavior of firms and government. Due to that meddling, we live in a world of imperfect competition—monopoly, monopolistic competition, and oligopoly. Paradise lost. In monopoly, a firm is the lone provider of a good, in monopolistic competition many firms produce differentiated products, and in oligopoly a small cabal of firms control the marketplace and exert price pressure.

The culprit which creates each of these distorted market types is barriers to entry. Whether natural or legal, barriers to entry prevent firms who would otherwise enter a market from entering. The few firms which are active in the market have control of too large a slice. As a result, they can affect the market price based on how many units they produce. Instead of a horizontal perceived demand curve, the firms in imperfect competition face a downward sloping demand curve.

To maximize its profit, the imperfectly competitive firm still produces at the level where MR = MC. But because of its outsized effect on the market, P no longer equals MR. With each unit produced, the increased supply exerts downward pressure on the price, which effects the price of all other units produced by the same amount. If such a firm produces too much, it can hurt its own bottom line. Because it supplies as much as it wants and not what consumers want, a true monopoly will have perpetual positive economic profits at a level which depends on the elasticity of the product’s demand schedule. Monopolistic competition, however, will in the long run result in a total erosion of economic profit as firms enter the market, all producing at a point on the AC curve, albeit not at its minimum point. As a result, none of these markets is productively or allocatively efficient. The amount of goods produced is below what consumers would have wanted under perfectly competitive conditions, they are more expensive than they are socially worth, and firms inefficiently do not produce at their minimum average cost. Customers are robbed of potential utility. Such markets are sadly the norm, because, we are told, “firms have proved to be highly creative in inventing business practices that discourage competition,” (Greenlaw 2018, 220). This is a great state of affairs for the firms, however, because “once barriers are erected, once a barrier to entry is in place, a monopoly that does not need to fear competition can just produce the same old products in the same old way,” (Greenlaw 2018, 229). Managers can kick back and watch the profits roll in.

Historical Overview

Sketched out above is the dominant parable in economic thought and teaching. Interestingly, almost none of this resembles the real world. How did we get here? An outline is sketched below.

Adam Smith is generally credited with establishing economic thought, or Political Economy, as a distinct field of study. His work An Inquiry into the Nature and Causes of the Wealth of Nations (1776) is regarded as the first modern work of economics. A key figure in the Scottish Enlightenment, Smith was interested in observing economic phenomena, describing them, and discovering the hidden patterns within. David Ricardo furthered and built on Smith’s ideas, advancing theories on rent, trade, and value. Over the course of the three volumes of Capital (1867), Karl Marx extended this theoretical framework even further with sharpened historical and class analysis, building a signature value theory in the process. Along with others, these thinkers are referred to as the Classical economists.

But in the 1870’s there occurred what is known as the Marginalist Revolution. The Long Depression (1873-96) caused a crisis of confidence in the capitalist world. Interestingly, it was during this period that the most utopian theoretical depictions of capitalism were popularized. W.S. Jevons (1871), Carl Menger (1871), and Leon Walras (1874) independently and almost simultaneously developed this new theoretical paradigm. They perceived fundamental flaws in the theoretical framework and methodologies of the Classical economists and sought to “pick up the fragments of a shattered science and to start anew,” (Jevons 1879/1965, Preface lii). The Classicals believed that the ultimate source of an item’s value was the amount of labor embodied in it and that market prices were connected to costs—prices of production. The Marginalists vehemently disagreed. “Value,” wrote Jevons, “depends entirely upon utility” (Jevons 1871/1965, 1). Echoing this sentiment, Menger wrote “there is no necessary and direct connection between the value of a good and whether, or in what quantities, labour and other goods of higher order were applied to its production” (Menger 1871/2007, 146). Value then stemmed from a buyers utility gained from a good; that utility being an index of the good’s scarcity.

Jevons and Walras both used advanced mathematics to express their ideas. Adopting algebra and calculus, they could express complex ideas with greater accuracy than was possible previously. "Why should we persist in using everyday language to explain things in the cumbersome and incorrect way, as Ricardo has often done,” wrote Walras, “when these things can be stated far more succinctly, precisely, and clearly in the language of mathematics?" (Heilbroner 1997, 226). Walras pioneered what is known as general equilibrium theory—the notion that a complex balance of supply and demand can exist in and between markets.

It is during this period that supply and demand curves and the modern theory of perfect competition are introduced. In order to make their highly abstract models functional and defined, economists had to make assumptions that did not necessarily fit with, and often outright contradicted economic reality. "The pure theory of economics, it must precede applied economics,” wrote Walras, “and this pure theory of economics is a science which resembles the physic-mathematical sciences in every respect," (Heilbroner, 224). Actual people and actual societies faded from the picture in favor of platonic ideals. This fundamental methodological shift opened up many new avenues of exploration for economists, but the descriptive and predictive usefulness of the new models was not necessarily clear. Perfect competition became the theoretical jumping off point for all ‘rigorous’ analysis, and Marshall (1890) systematized the theoretical structure into what would recognize as modern Neo-classical economics. Dobb notes, "at the purely formal level, there can be little doubt that the new context and methods, with their mathematical analogy if not mathematical form, resulted in enhanced precision and rigor of analysis…the cutting knives of economic discussion became sharper -- whether they were used to cut so deeply is another matter" (Dobb 1973, 176).

In the 1920s, unease with the dominance of perfect competition was growing. Sraffa (1925) aimed a potentially devastating critique at the then-dominant Marshallian partial equilibrium theory, demonstrating that the theoretical structure was not capable of dealing with non-constant returns (increasing or decreasing costs) adequately (Mongiovi 1996). The next year, Sraffa (1926) suggested a solution might be found using the lesser utilized monopoly theory as a starting point. Even in competitive markets, monopolistic tendencies could easily be observed because 1.) firms can exert some control over their own prices, and 2.) they frequently experience increasing returns (decreasing costs). Sraffa argued that these circumstances are not the exception, “rather they are normal and persistent features of the economic landscape, with 'permanent and even cumulative' consequences for market equilibria. When these influences are operative, each firm is to be viewed as having its own distinct market; prices are set so as to maximise profits on the supposition that the relevant demand curve is not perfectly elastic,” (Mongiovi 1996, 214). Building on these ideas, Robinson (1933) and Chamberlain (1933) independently, but simultaneously, developed the theory of imperfect competition that is taught today. Eventually abandoning Marshallian theory altogether, Sraffa’s publication of Production of Commodities by Means of Commodities (1960) is credited with establishing a distinctive Sraffian or Neo-Ricardian school.

Real Competition

In Capitalism: Competition, Conflict, Crises (2016), Anwar Shaikh erects a theoretical framework independent of perfect and imperfect competition. Formalizing insights developed by the Classical economists, a theory is built which is both analytically sound and corresponds to observed economic phenomena. The theory of real competition, as it is called, “is as different from so-called perfect competition as war is from ballet,” (Shaikh 2016, Ch. 7.I.). The classical economists stressed themes that were either diminished or omitted completely by Neo-classical economists, including conflict, class, and temporality. In Capital, Volume 1, Karl Marx writes that the economic realm is bellum omnium contra omnes, ‘war of all against all,’ (Marx 1867/1990, 477). All evidence of this is lost in the parables of perfect and imperfect competition. But in Capitalism, the theory of real competition “pits seller against seller, seller against buyer, and buyer against buyer. It pits capital against capital, capital against labor, and labor against labor,” (Shaikh 2016, Ch. 7.I.). Abstracting away from the essentiality of conflict to capitalist production and distribution makes Neo-Classical analysis not only unrealistic, but totally misleading.

But even on pure theoretical grounds there are issues with the theory of perfect competition. For one, there is a fundamental contradiction within the assumptions. Firms are assumed to have perfect knowledge of the market in which they are competing, yet their perceived demand curve is assumed to be flat. These two assumptions cannot hold at the same time. “If firms are assumed to be sensible in their expectations, then the theory of perfect competition collapses. More generally, even mildly informed firms would have to recognize that they face downward sloping demand curves under competitive conditions,” (Shaikh 2016, Ch. 8.I). If a firm in a perfectly competitive market has perfect knowledge, it would quite easily deduce that the market signals it is receiving are being received by every other firm, and those firms will react in a predictable manner. As a result, the firm would know that it does not face a flat, perfectly elastic demand curve, and would act in exactly the same manner as a monopolistic firm, with just the same results.

Another problematic assumption within the orthodox framework is that firms are entitled to a normal rate of profit, which is included within its cost structure. The action of competition completely erodes excess profits away but leaves normal profits intact. This, of course, is wildly unrealistic because “no capital is assured of any profit at all, let alone the “normal” rate of profit. Indeed, all capitals face losses at some point, and a certain number drown in red ink in every given interval. It is therefore completely illegitimate to count “normal profit” as part of operating costs,” (Shaikh 2016, Ch. 7.I.). The prospect of making a loss is the dark cloud that hangs over every business manager, driving them unceasingly into conflict with agents both inside and outside the firm. Abstracting away from this motive force fundamentally misdiagnoses the motivations of economic agents.

In the theory of perfect competition, a firm’s only decision is how much to produce. Likewise, in imperfect competition, pricing and quantity decisions are mechanically connected. But in the works of the Classicals and in the theory of real competition, firms are active price setting, cost cutting entities. Neo-Classical theory stresses that firms will flock to higher profit rates at a given price. But once firms have the power to set their own price, the picture becomes more complicated. In their endless search for higher rates of return, firms cut prices to attract more buyers and increase market-share. In the process, “the advantage in this perpetual jousting for market share goes to the firms with the lowest cost,” (Shaikh 2016, 7.II.). If firms have the power to cut their own prices, they have the power to starve out other firms—even ones that are potentially more profitable at initial prices. Neo-Classical theory stresses that firms will adopt whatever method yields the highest profit at a given price, but “when costs differ, there is always a set of prices at which the lower cost firm has the higher profit rate. This does not mean that [it] has to drive the price down to that level. It has only to get the message across to its competitor that the future has arrived,” (Shaikh 2016, 7.VII.). This is demonstrated in Table 1 below. Pricing wars, which are extremely common occurrences in the real economy, highlight the conflictual nature of economic relations—"these are the operative principles of warfare: attackers try to impose greater losses on the other side. We will see that such behavior is the norm in the business world. It follows that the highest profit that is sustainable in the face of price-cutting behavior is generally different from the price-passive profit assumed in theories of perfect and imperfect competition,” (Shaikh 2016, 7.II.). Only the theory of real competition deals with this common behavior adequately.

Conclusion

Contrary to Hicks’ assertion, a peaceful life is not included in a firm’s profit—no matter their degree of monopoly. There is perpetual conflict generated both inside and outside of the firm that must always be contended with. For real firms, “price is their weapon, advertising their propaganda, the local Chamber of Commerce their house of worship, and profit their supreme deity,” (Shaikh 2016, 7.II.). Abstraction is a necessary tool for analysis. But the specific method of abstraction used in the theories of perfect and imperfect competition does not serve to elucidate truths that would be otherwise unattainable. Neo-Classical economics was formulated during a crisis of capitalism to create a utopian vision in order to justify capitalist social relations. Capitalist relations have been shown to be the most powerful and productive in history, but that does not justify obscuring their fundamentally destructive and chaotic elements. Competition is not merely the absence of monopoly power—it is the struggle of all against all.

References

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