Thursday, 30 April 2009

Responding to the economic crisis: What might governments do?

The next Cafe Economique, at 7.30 pm on Tuesday 12th May 2009, at The Old Stables, 7 Regent Street, Chapel Allerton, Leeds LS7 (venue details below).

The topic will be: ‘Responding to the economic crisis: What might governments do?’

The discussion will be introduced by Brendan Sheehan, Senior Lecturer, Leeds Metropolitan University, whose book ‘Understanding Keynes’ General Theory’ was published earlier this year.

Governments worldwide are grappling with ideas to address the current economic crisis. Drawing on important policy insights from the economist John Maynard Keynes’ work, Brendan Sheehan will look at the reasons behind different government actions and what these might be expected to achieve.

The meeting will start at 7.30 pm at The Old Stables, 7 Regent Street, Chapel Allerton, Leeds LS7 4PE (up the driveway opposite the Sukhothai Restaurant). The doors will be open from 7 pm, and the discussion will be from 7.30 pm to 9.30 pm.

Monday, 27 April 2009

Thoroughly Modern Marx

From the latest edition of the slightly liberalish but very establishment American Foreign Policy magazine is this piece by Socialist Register editor Leo Panith.

Original at:

Thoroughly Modern Marx
By Leo Panitch
Foreign Policy May/June 2009

Lights. Camera. Action. Das Kapital. Now.

The economic crisis has spawned a resurgence of interest in Karl Marx. Worldwide sales of Das Kapital have shot up (one lone German publisher sold thousands of copies in 2008, compared with 100 the year before), a measure of a crisis so broad in scope and devastation that it has global capitalism—and its high priests—in an ideological tailspin.

Yet even as faith in neoliberal orthodoxies has imploded, why resurrect Marx? To start, Marx was far ahead of his time in predicting the successful capitalist globalization of recent decades. He accurately foresaw many of the fateful factors that would give rise to today’s global economic crisis: what he called the “contradictions” inherent in a world comprised of competitive markets, commodity production, and financial speculation.

Penning his most famous works in an era when the French and American revolutions were less than a hundred years old, Marx had premonitions of AIG and Bear Stearns trembling a century and a half later. He was singularly cognizant of what he called the “most revolutionary part” played in human history by the bourgeoisie—those forerunners of today’s Wall Street bankers and corporate executives. As Marx put it in The Communist Manifesto, “The bourgeoisie cannot exist without constantly revolutionizing the instruments of production, and thereby relations of production, and with them the whole relations of society. . . . In one word, it creates a world after its own image.”

But Marx was no booster of capitalist globalization in his time or ours. Instead, he understood that “the need for a constantly expanding market for its products chases the bourgeoisie over the whole surface of the globe,” foreseeing that the development of capitalism would inevitably be “paving the way for more extensive and exhaustive crises.” Marx identified how disastrous speculation could trigger and exacerbate crises in the whole economy. And he saw through the political illusions of those who would argue that such crises could be permanently prevented through incremental reform.

Like every revolutionary, Marx wanted to see the old order overthrown in his lifetime. But capitalism had plenty of life left in it, and he could only glimpse, however perceptively, the mistakes and wrong turns that future generations would commit. Those of us now cracking open Marx will find he had much to say that is relevant today, at least for those looking to “recover the spirit of the revolution,” not merely to “set its ghost walking again.”

If he were observing the current downturn, Marx would certainly relish pointing out how flaws inherent in capitalism led to the current crisis. He would see how modern developments in finance, such as securitization and derivatives, have allowed markets to spread the risks of global economic integration. Without these innovations, capital accumulation over the previous decades would have been significantly lower. And so would it have been if finance had not penetrated more and more deeply into society. The result has been that consumer demand (and hence, prosperity) in recent years has depended more and more on credit cards and mortgage debt at the same time that the weakened power of trade unions and cutbacks in social welfare have made people more vulnerable to market shocks.

This leveraged, volatile global financial system contributed to overall economic growth in recent decades. But it also produced a series of inevitable financial bubbles, the most dangerous of which emerged in the U.S. housing sector. That bubble’s subsequent bursting had such a profound impact around the globe precisely because of its centrality to sustaining both U.S. consumer demand and international financial markets. Marx would no doubt point to this crisis as a perfect instance of when capitalism looks like “the sorcerer who is no longer able to control the powers of the netherworld whom he has called up by his spells.”

Despite the depth of our current predicament, Marx would have no illusions that economic catastrophe would itself bring about change. He knew very well that capitalism, by its nature, breeds and fosters social isolation. Such a system, he wrote, “leaves no other nexus between man and man than naked self-interest, than callous ‘cash payment.’” Indeed, capitalism leaves societies mired “in the icy water of egotistical calculation.” The resulting social isolation creates passivity in the face of personal crises, from factory layoffs to home foreclosures. So, too, does this isolation impede communities of active, informed citizens from coming together to take up radical alternatives to capitalism.

Marx would ask first and foremost how to overcome this all-consuming social passivity. He thought that unions and workers’ parties developing in his time were a step forward. Thus in Das Kapital he wrote that the “immediate aim” was “the organization of the proletarians into a class” whose “first task” would be “to win the battle for democracy.” Today, he would encourage the formation of new collective identities, associations, and institutions within which people could resist the capitalist status quo and begin deciding how to better fulfill their needs.

No such ambitious vision for enacting change has arisen from the crisis so far, and it is this void that Marx would find most troubling of all. In the United States, some recent attention-getting proposals have been derided as “socialist,” but only appear to be radical because they go beyond what the left of the Democratic Party is now prepared to advocate. Dean Baker, codirector of the Center for Economic and Policy Research, for example, has called for a $2 million cap on certain Wall Street salaries and the enactment of a financial transactions tax, which would impose an incremental fee on the sale or transfer of stocks, bonds, and other financial assets. Marx would view this proposal as a perfect case of thinking inside the box, because it explicitly endorses (even while limiting) the very thing that is now popularly identified as the problem: a culture of risk disassociated from consequence. Marx would be no less derisive toward those who think that bank nationalizations—such as those that took place in Sweden and Japan during their financial crises in the 1990s—would amount to real change.

Ironically, one of the most radical proposals making the rounds today has come from an economist at the London School of Economics, Willem Buiter, a former member of the Bank of England’s Monetary Policy Committee and certainly no Marxist. Buiter has proposed that the whole financial sector be turned into a public utility. Because banks in the contemporary world cannot exist without public deposit insurance and public central banks that act as lenders of last resort, there is no case, he argues, for their continuing existence as privately owned, profit-seeking institutions. Instead they should be publicly owned and run as public services. This proposal echoes the demand for “centralization of credit in the banks of the state” that Marx himself made in the Manifesto. To him, a financial-system overhaul would reinforce the importance of the working classes’ winning “the battle of democracy” to radically change the state from an organ imposed upon society to one that responds to it.

“From financialisation of the economy to the socialisation of finance,” Buiter wrote, is “a small step for the lawyers, a huge step for mankind.” Clearly, you don’t need to be a Marxist to have radical aspirations. You do, however, have to be some sort of Marxist to recognize that even at a time like the present, when the capitalist class is on its heels, demoralized and confused, radical change is not likely to start in the form of “a small step for the lawyers” (presumably after getting all the “stakeholders” to sit down together in a room to sign a document or two). Marx would tell you that, without the development of popular forces through radical new movements and parties, the socialization of finance will fall on infertile ground. Notably, during the economic crisis of the 1970s, radical forces inside many of Europe’s social democratic parties put forward similar suggestions, but they were unable to get the leaders of those parties to go along with proposals they derided as old-fashioned.

Attempts to talk seriously about the need to democratize our economies in such radical ways were largely shunted aside by parties of all stripes for the next several decades, and we are still paying the price for marginalizing those ideas. The irrationality built into the basic logic of capitalist markets—and so deftly analyzed by Marx—is once again evident. Trying just to stay afloat, each factory and firm lays off workers and tries to pay less to those kept on. Undermining job security has the effect of undercutting demand throughout the economy. As Marx knew, microrational behavior has the worst macroeconomic outcomes. We now can see where ignoring Marx while trusting in Adam Smith’s “invisible hand” gets you.

The financial crisis today also exposes irrationalities in realms beyond finance. One example is U.S. President Barack Obama’s call for trading in carbon credits as a solution to the climate crisis. In that supposedly progressive proposal, corporations that meet emissions standards sell credits to others that fail to meet their own targets. The Kyoto Protocol called for a similar system swapped across states. Fatefully however, both plans depend on the same volatile derivatives markets that are inherently open to manipulation and credit crashes. Marx would insist that, to find solutions to global problems such as climate change, we need to break with the logic of capitalist markets rather than use state institutions to reinforce them. Likewise, he would call for international economic solidarity rather than competition among states. As he put it in the Manifesto, “United action, of the leading . . . countries, at least, is the first condition for the emancipation of the proletariat.”

Yet the work of building new institutions and movements for change must begin at home. Although he made the call “Workers of the world, unite!” Marx still insisted that workers in each country “first of all settle things with their own bourgeoisie.” The measures required to transform existing economic, political, and legal institutions would “of course be different in different countries.” But in every case, Marx would insist that the way to bring about radical change is first to get people to think ambitiously again.

How likely is that to happen? Even at a moment when the financial crisis is bleeding dry a vast swath of the world’s people, when collective anxiety shakes every age, religious, and racial group, and when, as always, the deprivations and burdens are falling most heavily on ordinary working people, the prognosis is uncertain. If he were alive today, Marx would not look to pinpoint exactly when or how the current crisis would end. Rather, he would perhaps note that such crises are part and parcel of capitalism’s continued dynamic existence. Reformist politicians who think they can do away with the inherent class inequalities and recurrent crises of capitalist society are the real romantics of our day, themselves clinging to a naive utopian vision of what the world might be. If the current crisis has demonstrated one thing, it is that Marx was the greater realist.

Leo Panitch is Canada research chair in comparative political economy and distinguished research professor of political science at York University in Toronto, and coeditor of the annual Socialist Register.

Friday, 24 April 2009

Policing The Crisis

Policing The Crisis

A public forum with speakers on the G20 in London, the recent mass arrests in
Nottingham, and the policing of dissent in Leeds

Organised by wewontpayfortheircrisis Leeds

Thursday, May 14, 2009, 7:00pm

The Common Place
23 Wharf Street

Tuesday, 21 April 2009

Book Launch: Feelbad Britain

Taking Soundings Leeds presents:

Feelbad Britain: How to make it better
by Pat Devine, Andrew Permain, and David Purdy

Book Launch event to be held on Wednesday 3 June 2009 Old Broadcasting House, 6-8 pm.

Pat Devine (co-editor) – Introduction honorary Research Fellow University of Manchester

David Beetham – Democracy Professor Emeritus University of Leeds

Noel Castree – Environment Professor School of Environment and Development University of Manchester

Linda Patterson – Health OBE, consultant physician

Taking Soundings own Matthew Caygill will be a critical discussant to the four presentations.

Taking Soundings is happy to announce that the event will be followed by a wine reception.

About Feelbad Britain:
The central thesis of Feelbad Britain is that after the decades of neoliberalism the institutions and social relations on which solidarity, trust and citizenship depend have been undermined. This has left contemporary British society in a troubled and dysfunctional state, without the cohesion or confidence needed if we are to escape from recession, combat climate change and restore faith in government. The authors put forward a theoretical framework for understanding contemporary politics; and they consider what is to be done to revitalise the British left, challenge neoliberal hegemony, and develop a political project aimed at creating a greener, fairer, happier, more democratic and less divided Britain.

Tuesday, 14 April 2009


DIY newspaper hits the streets of Leeds

Free copies of the Yorkshire Evening Pest are being handed out to thousands of people across Leeds, in a format that mimics the city's Yorkshire Evening Post – albeit with articles on the collapse of the city centre, climate change, the role of public transport and the financial turmoil at Elland Road.

In fact, the parody is just a little too accurate for many in the city. "While some people were queuing up to take them out of our hands, others rushed past, thinking it was just another Evening Post," said Colleen Platts, one of the people behind the project.

The Yorkshire Evening Pest is the latest example of a new form of 'citizen journalism' which has emerged in the current financial crisis. Last week, thousands of spoof copies of the Financial Times were handed out in London ahead of the G20 summit. Its editor accused the media of complicity by failing to to ask the difficult questions in the lead-up to the fiscal meltdown. "It's the job of journalists to support facts and not opinions, but a lot of what's reported as facts are actually the opinions of powerful people," said Raoul Djukanovic.

With falling advertising revenue and the inexorable rise of other media, the UK's regional papers are facing problems of their own. Johnston Press, owners of the Yorkshire Evening Post, are embroiled in a bitter industrial dispute: 140 workers have been taking strike action since mid-February over its plan for compulsory redundancies at the paper and its sister title, the Yorkshire Post. As the Yorkshire Evening Pest explained, such cutbacks inevitably mean even less time to research stories, and greater pressure to regurgitate press releases.

But it's not all doom and gloom, as Colleen Platts explained. "Local papers still have a hugely important role to play. They have a street presence which means they can provide that city-wide 'water-cooler moment' in a way that online news portals can't. But they'll only do this if they ask the right questions – something they seem increasingly reluctant to do."

For further information, contact

Biofuels: Do they have a role in a sustainable future?

Cafe Economique Leeds invites you

21 April, 7.30pm:
‘Biofuels: Do they have a role in a sustainable future?’
The discussion will be introduced by Jen Dyer, Researcher, Sustainability Research Institute, University of Leeds.

Biofuels produced from crops are promoted as a solution to climate change. Can they help or will they make matters worse?

A short summary about biofuels can be found here.

A longer report can be found here. .

Tuesday 21st April 2009, at The Old Stables, 7 Regent Street, Chapel Allerton, Leeds LS7(up the driveway opposite the Sukhothai Restaurant). The doors will be open from 7 pm, and the discussion will be from 7.30 pm to 9.30 pm.

Wednesday, 8 April 2009

Politics after the crash

5th annual Soundings event
10.00 am – 4.30 pm
20 June 2009

Tavistock Centre
120 Belsize Lane
London NW3

The discussion will focus on political responses to the financial meltdown, including putting forward an alternative narrative for understanding the crisis, and discussing new alliances and ideas for change.

Join the debate on the new socialism. How shall we
Respond to the economic crisis and what sort of
politics and alliances do we need to develop in the
longer term? The future starts today

More information to follow. For updates go to