Contradictions of Monopoly Capital

From Monthly Review:

The main consequences of the internationalization of monopoly capital for accumulation are the intensification of world exploitation and a deepening tendency to stagnation. Since the 1970s, there has been a worsening slowdown in the rate of growth of the world economy centered in the advanced capitalist economies—while many of the most dire effects of the world crisis are falling on the poorest countries of the world. The growth of international monopoly-finance capital has not only spread stagnation across much of the globe but has also given rise to financialization, as the giant firms, unable to find sufficient investment outlets for their enormous economic surpluses within production, increasingly turn to speculation within the global financial sphere. As a result, financial crises have become both more common and more severe, while state systems everywhere are increasingly subject to the whims of giant capital and are forced to bail out corporations that are deemed “too big to fail.” Governments at the national, regional, and local levels seek to clear up the resulting fiscal crises by hammering the general public, cutting back on social services while creating more regressive tax systems, thereby ratcheting up the effective level of exploitation in society. Hence, the internationalization of monopoly capital, rather than contributing to the stabilization of the world system, is generating ever-greater crises, not only for the private economy but also for state systems.

Inequality, in all its ugliness, is, if anything, deeper and more entrenched. Today the richest 2 percent of adult individuals own more than half of global wealth, with the richest 1 percent accounting for 40 percent of total global assets. If, in the “golden age” of monopoly capitalism in the 1960s, the gap in per capita income between the richest and poorest regions of the world fell from 15:1 to 13:1—by the end of the twentieth century, the gap had widened to 19:1. From 1970 to 2009, the per capita GDP of developing countries (excluding China) averaged a mere 6.3 percent of the per capita GDP of the G8 countries (the United States, Japan, Germany, France, the United Kingdom, Italy, Canada, and Russia). From 2000 to 2006 (just prior to the Great Financial Crisis), this was only slightly higher, at 6.6 percent. Meanwhile, the average GDP per capita of the fifty-eight or so Least Developed Countries (a UN-designated subset of developing countries) as a share of average G8 GDP per capita declined from 1.8 percent in 1970, to 1.3 percent in 2006. The opening decade of the twenty-first century has seen waves of food crises, with hundreds of millions of people chronically food-deprived, in an era of rising food prices and widespread speculation.

The supreme irony of the internationalization of monopoly capital is that this entire thrust toward monopolistic multinational-corporate development has been aided and abetted at every turn by neoliberal ideology, rooted in the “free market” economics of Hayek and Friedman. The rhetoric invariably promotes human freedom, economic growth, and individual happiness—or “democracy” in popular parlance—on a global scale, with no outposts of “tyranny” remaining. There are, in the Hayekian view, two enemies of this rosy future: labor and the state (insofar as the latter serves the interest of labor and the general population).

This neoliberal campaign for the internationalization of monopoly capital is not merely an attack on the working class. Rather it must be understood, more broadly, as an attack on the potential for political democracy, that is, on the capacity of the people to organize as an independent force to counteract the power of corporations. With no clear notion they are contradicting themselves, much less denying reality, neoliberals paint a picture of a small “libertarian” state that gets out of the way of individuals, business, and free markets worldwide. Yet, to paraphrase the old calypso song, this millionaire’s “libertarian” heaven is the poor person’s hell.

In fact, state spending across the planet has hardly shrunk. Instead, states increasingly serve the needs of national and international monopoly capital, by aiding and abetting “the take” of their “own” giant corporations—with political elites corrupted by payoffs, which come in innumerable forms. At the same time, these quasi-privatized state systems have become ever more preoccupied with incarcerating and oppressing their domestic populations.

“The Internationalization of Monopoly Capital”, John Bellamy Foster, Robert W. McChesney and R. Jamil Jonna, Monthly Review