«Into their place stepped free competition, accompanied by a social and political constitution adapted in it, and the economic and political sway of the bourgeois class.
A similar movement is going on before our own eyes. Modern bourgeois society, with its relations of production, of exchange and of property, a society that has conjured up such gigantic means of production and of exchange, is like the sorcerer who is no longer able to control the powers of the nether world whom he has called up by his spells. For many a decade past the history of industry and commerce is but the history of the revolt of modern productive forces against modern conditions of production, against the property relations that are the conditions for the existence of the bourgeois and of its rule. It is enough to mention the commercial crises that by their periodical return put the existence of the entire bourgeois society on its trial, each time more threateningly. In these crises, a great part not only of the existing products, but also of the previously created productive forces, are periodically destroyed. In these crises, there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity — the epidemic of over-production. Society suddenly finds itself put back into a state of momentary barbarism; it appears as if a famine, a universal war of devastation, had cut off the supply of every means of subsistence; industry and commerce seem to be destroyed; and why? Because there is too much civilisation, too much means of subsistence, too much industry, too much commerce. The productive forces at the disposal of society no longer tend to further the development of the conditions of bourgeois property; on the contrary, they have become too powerful for these conditions, by which they are fettered, and so soon as they overcome these fetters, they bring disorder into the whole of bourgeois society, endanger the existence of bourgeois property. The conditions of bourgeois society are too narrow to comprise the wealth created by them. And how does the bourgeoisie get over these crises? On the one hand by enforced destruction of a mass of productive forces; on the other, by the conquest of new markets, and by the more thorough exploitation of the old ones. That is to say, by paving the way for more extensive and more destructive crises, and by diminishing the means whereby crises are prevented.
The weapons with which the bourgeoisie felled feudalism to the ground are now turned against the bourgeoisie itself.»
Karl Marx in Communist Manifesto
There is a growing talk among mainstream economists and the financial media of a new global economic recession. Until the last few weeks, the locus of this new slump has been focused on China. But, as I have argued in a previous post, it is unlikely to start there. Much more important to the world economy is the largest economy in the world in terms of national output and financial fire-power, the US.
In the last few weeks, there has been a continuous series of poor data for the US economy: falling manufacturing output, weakening business sentiment and capital goods orders and falling corporate profits. And globally, international agencies by the week seem to announce reduced forecasts for economic expansion.
The latest of these agencies, after the IMF, the World Bank and the OECD, is the United Nations. In its report on global economic perspectives, it concluded that
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