Zombie Capitalism Global Crisis and the Relevance of Marx

Schumpeter, Joseph 10; and creative destruction 1 94-5; and long waves 373

Scientific American warning on peak oil 318

Second Cold War and arms spending 234

Self employment, in Africa and India 339

Self-expansion of capital 75

Selyunin, Vasily, quoted on accumulation and consumption in USSR 204

Semi-colonies 185

Sen, Abhijit, analysis of India poverty figures 252

Serge, Victor 349

Services and industry, false distinction 333

Services, breakdown of category 334; central to capitalist production today 334; productive and unproductive 121

Shaikh, Anwar, and Tonak, Ertugrul Ahmet 126, 195-7

Shaikh, Anwar, on mainstream economics and crises 56; on values and prices 49; on distribution of welfare costs between labour and capital 174

Shanghai 243

Share of national income going to labour in 1990s, 1980s and early 2000s 236-7

Shareholder value, theories of 294; criticised 295

Shiv Sena 345

Simpson, Derek, praise for Gordon Brown 303

Simultaneous equations, error in using them with economic processes through time 7 4

Singapore 218, 221, 242

Skidelsky, Robert, on Keynes 162

Slave labour in USSR under Stalin 158

Slump of 1930s 144-168, 325; different explanations 149; rate of profit and rate of exploitation 151; and concentration and centralisation of capital 153; how capitalism got out of it 303

Slump, beginning in USSR in late 1989

209; in former Eastern Bloc in
1990s 224-5

Smith, Adam 12, 43, 46, 55; on value and labour 30; on origins of profits in labour 29; ambiguities in theory of value 22, 30, 4 7; theory of falling rate of profit 69; productive and unproductive labour 121

Smoot-Hawley Act 145; not to blame for world slump of 19 30s 302

"Social contract", myth of during long boom 164, 172

Social Democracy, ideology 1 64

Social exclusion, ideological character of term 342

Social wage 13 7

Socialisation of next generation of labour power 173

"Socialist societies" of old Eastern bloc as state capitalist 1 1 8

Socially necessary labour 46

Socially necessary labour time 25

Soil fertility 82; falling 321

Solidarnosc 206

Soros, George, on scale of crisis of 2008-9 300

South Africa, strikes of 2007 343; attacks on Zimbabwe refugees 345

South Korea 221, 242; economic growth under Park Chung Hee dictatorship 1 88; per capita growth in 1960s 189; "economic miracle", IMF on 242

Soviet crisis of 1989-91 207-11

Soviet-type economies, dynamic of 202

Spain 218

Speculation, in late 1920s US 147; in China in mid 2000s 249; in bubbles of 1990s and 2000s 214, 249, 278, 281, 283, 285, 322

Sraffians 23

Stalin, on "catching up" with West 158; death 176

State apparatuses, loss of cohesion in the face of different interests of different capitals 268

State bureaucracy, as agents of capital accumulation 1 14; class character of 1 12

State capital, in Capital Volume Two 1 15

Statecapitalism, 104, 159; economic dynamic 118; GermanyandJapanin 19 30s 15 5; during long boom 170; militarised 172;Ja panese directed to globalmarketcompetition 1 71; Stalinism and Keynesianism as its ideological correlates 302; and limits to accumulation within a national economy201,206; and state capitalists 1 15-19

420

Index

State capitalist trusts, in Bukharin's theory 95-6

State directed, monopoly capitalism and war 156; industrialisation, in India 251

States, economic management during First World War 154; role in supplying labour power in long boom 172; expenditure, US, 1 800- 1980 103; revenues as arising from surplus value 1 13-14; comparable to profit, interest and rent 1 12; share in national output, Japan in early 2000s 216; theories that see as external to capitalist economic system 103-4, 1 1 2; little attention to in Capital 88; role in integrating mass of people into system 1 1 0-1 1

States and capitals, structural interdependence 1 1 O; difficulties of break between them 112, 1 13, 1 14; relationship left unresolved by Marx 102; in Lenin's theory 93-5; in the era of "globalisation" 264-70

Steedman, Ian 48; alleged refutation of Marx on falling rate of profit 71

Steindl, Josef 146

Stern report 309; suggestions tailored to profitability 312

Stern, Todd 313

Stockhammer, Engelbert, and finance and real investment, quoted 295 "Stop-go" policies 164

Strachey, John 64,158, best known writer on Marxist economics in Britain in 1930s 163; decides Keynes is right 163; and "end of imperialism" 164

Strikes, air trafic controllers in US, defeated 238; miners in Britain, defeated 239; Egypt, 2006 344; South Africa, 2007 343; Soviet miners of 1989 209; Mumbai textile strike 1 982-3 345

Strong, Benjamin 145

Subprime mortgages 286

Sub-Saharan Africa, growth in 1960 189; debt burden 279; much of it marginal to global capital 224, 340

Subsidy to advanced countries from Third World through migration 173

Subsistence farmers 21

Summers, Larry, and "the new paradigm" 229

Surplus value 29, 31-5; relative 34; see also Absolute Surplus Value, Relative Surplus Value

Sweezy, Paul 48; on transformation of values into prices 48

Syria 185

Taiwan 218, 242

Taleb, Nassim Nicholas, cheered at Davos for attack on bankers 292 Taylor, F W 34

Taylorism 35; and assembly line 35
TechNet 220

Technical advance, and the organic composition of capital 70-1

Technical composition of capital 69, 71; and organic composition of 73 71; and organic composition of 73

Telecoms investment boom of late 1990s 285

Temin, Peter, on Smoot-Hawley Act 302

Temporary contracts, Britain 337

Tett, Gillian, on Zombie banks, 12, 354

Thailand 221, 242; per capita growth in 1 960s 189

The means of production, ownership of 29

The new working classes of the "Third World" 336-339

Theory and Practice of Socialism, The (John Strachey) 163

Third World 18; economic growth during long boom 161, multinationals 220-1, 257 see also Global South

Three Mile Island 308

"Thrombosis in crisis" 153

Tiananmen Square protests of 1989 244

"Tiger cubs" 242

"Tigers" 242; after Asian crisis 282

Tipping points 308, 327

Tonk, Ertugrul Ahmet 126, 195-7

Index

421

Tony Cliff, on military competition 1 1 7; on H-bomb and long boom 172

Tory Party, splits in 1 990s and different multinational agendas of diferent capitals 268

Totalitarianism, theories fail to foresee crises in Eastern bloc 179

Toynbee, Polly, spreads myth about two thirds of population being middle class 334; praise for Gordon Brown 303

Trade and budget deficits of US in 2000s 273

Transformation of values into prices 48

Transformation problem 46-50, 74; critiques of Marx's solution 48 see also Okishio's Theorem

Transnationality Index 260

"Triad" of North America, the EU and Japan 262

Trostle, Ronald, on innovation and inability of small farmers to pay royalties 322

Trotsky, Leon 159; on capitalism living by booms and slumps 68; on statification 1 16; on equalisation of economic development 1 87; on convulsive and uneven development under capitalism 1 90

Trusts 86-9

Turner, Adair, quoted 289-90

Turner, Graham 163

Turnover time of capital, and rate of profit 235

Ultra-imperialism 92, 185

UNCTAD 1 7, 186; on multinational corporations in early 2000s 257; transnationality index 260

Underconsumptionist theories 58
Underproduction 61

Unemployment, and economic crises, in 19th century 55; in 1 932 143; during long boom 172; in mid 1 970s 191; in USSR, 208; in Global South 339; "natural" or "noninflationary" level of 137, 192; benefits, during long boom 174; cut in Germany in early 2000s 240

Union Miniere de Haut Katanga mining

corporation, nationalised 185 "Unipolar world" 274 “Unipolar world” 274

United States, imperialism without formal colonies 182; seizure of Philippines and Puerto Rico 97; economic crises 18 10-1920 55; industrial growth 1914 to 1 929 144; share of world output, 1 920 143; investment in 1 920s 146; recession in 1927, 147; fall in output 1929-33; decline in capital stock 1919-45 164-5; Federal Reserve Bank in 1930-31, 145; federal expenditure, in New Deal and in 2008 300; military expenditure, before World War Two 165; government capital expenditure 1941 156; state share of investment 1943 157; economic output 1947-70 161; recession of 1 949 1 65; labour productivity in 1970s 202; methods to keep hegemony over Europe and Japan during Cold War 268-9; government spending, during long boom 164; post war hegemony over Western Europe 180; share of world output in long boom 170; overseas investment during Cold War 1 8 1; unemployment in 1950s 172; growth of foreign trade in 1970s 201; share of arms expenditure in GNP declines during long boom 198; economic policy, 1980s 194; fall in median wage 1973-98 236; productive workforce in post-war decades 126; employed workforce 1940-70 172; employment in trade and finance 126; rates of profits and investment, 1948-2005 235; growth in corporations sales after "Plaza Accord" 266; attempt to gain from Russian occupation of Afghanistan 268-9; computer corporations overtake Japanese in 1990s 265; import of inputs in 1990s and early 2000s 262; Congress, fear that Japan would overtake US 211; investment 223; number of workers in 1998 compared with 1971 and 1950

422

Index

332; arms spending 2005 234; balance of trade 198; trade and budget deficits in 2000s 273; blows to hegemony, 274; overseas hegemony and crisis of 2007-9 327; nationalises Freddy Mac and Fanny Mae 277; sources of oil 319; world's biggest manufacturing country 332-3

Unproductive expenditures, and the dynamic of the system 129; and boom of 1920s 146-7

Unproductive labour, and waste production 127; scale of in US 126

Urbanisation in 20th and 21st centuries 337; and growth of wage labour, 336

US capitalism's interest and climate change 317

Use value 23; in Adam Smith 22

Use value and exchange value 108, 176; and crisis 59; under military competition 1 1 7

USSR, character of economy aher 1929 158; economic mechanisms established in 1928-9 157-9; accumulation and consumption 177, 204; bureaucracy substitutes itself for capitalist class 1 57; slave labour 176; and law of value 176, 204; economic growth 1950-70s 175; seen as model for Third World development 186; imperialism in Eastern Europe 181; Competition with West, Brezhnev on 203; causes of waste 177; consumer goods appear by 1960s 175; as world's second economic power 211; productivity and competition with US 180; agricultural problems 176; cyclical fluctuations in growth 178, 204; from Stalin to Gorbachev 1 15; growth rates long term decline

203; growing dependence on foreign trade 207; stagnation of 1 980s 202-3; crisis of late 1 980s, causes and scale of 181, 207-8; compared with Japanese crisis of 1 990 217; why market reforms were not the answer 210-12; inflation of late 1 989 and early

1991 208; revolts of national minorities 208; collapse of 234

"Valorisation" 37

Value added in schools 135

Value 25, 32, 33; substance of 26; and prices 46-50; during crises 60-1; Marx on productivity and 27; and technical advance 27

Vampire-like character of capitalism 84

Variable capital 38, 70

Venezuela 221, 351; and US oil 319

Viemam 1 84, 1 85; French withdrawal 182

Viemam War 327; and cost to US 271,198

Village industries 243

Vitro 221

Volcker "coup" 296

Volcker, Paul, raises interest rates 1979 296

von Bortkiewicz, Ladislavs, on transformation of values into prices 48-9

Wade, Robert, calls for greater regulation 292

Wage controls 178

Wage labour in USSR 158

Waged employment, fall in several African countries 339

Wages, and development of crises 60; rises in US in 1 920s 145; not cause of low profits in 1970s 1 97; of US workers in 1970s 1 97; japan in 1 980s 213; real fall in Germany in early 2000s 237

Wall Street crash 143

Walras, Leon 42; ignores problem of time 42; economic crises 56

War and surplus value 156

War on terror and arms spending 234; failures in 32 7

Warren, Bill, theory imperialism as advancing economic development 189-90

Wars, waged by US in Global South 271, 273; hot, waged in Third World 268

"Washington Consensus" 221

Waste expenditure 234; in US, 1 970 127; and accumulation 129-30; a

Index

423

contradictory role 132 Waste production 126 "Weightless economy" 332; myth of 257 Welfare expenditure, productive and unproductive 137; as proportion of GDP in different countries 1975-95 (table) 238 Welfare provision, early development in Britain 134; development in 20th century 135; during long boom 164; costs in Western Europe and US 174; cuts to 137 Welfare state and needs of capital 135 Wolf, Martin 197; on Thai crisis of 1997 as a "blip"242; quoted on financial crises 280; quoted on "deleveraging" 290; on role of US household borrowing in keeping global economy going 288 Wolff, Edwin 195-6, 1 95, 197 Women, married, entry into employed workforce during long boom 173 Wood, Ellen Meiksins 1 12; on imperialism as caused by politics, not capitalist economics 93; state not instrument of appropriation under capitalism 104 Woolworths in UK goes bust 291 Work measurement and payment schemes 137 Workers, number in world according to Deon study 331; as proportion of workforce in US 334 Working class, in classical Marxism 329-30; theories of decline of 330-1; global size of 331; global distribution of 337; unevenness within 330; relation of the formal and informal sectors 338-344 Working day, legal limits on 33, shortening in 20th century 33; lengthening of 33 Working hours, decline in first part of 20th century 89 Working year, different countries, 2004 239; United States, 1 973-98 236 Workplace and community 343 World accumulation, 1970-2004 232 World Bank, endorsement of state planning in 1950s and 60s 186 World growth 1961-2003 231 World Trade Organisation,

negotiations, states and corporate interests 266

World Trade Organisation 17

WorldCom, bankruptcy 233

Wright Mills, C 331

X-efficiency 169, in West and in USSR 204

Yeltsin, Boris, and dissolution of USSR 210

Zapatistas 346, 348

Zeilig, Leo, and Ceruti, Claire, on South African township 343 Zombie banks 1 1

424

Index

An incisive and devastating critique of capitalism, sounding the alarm that the system poses a threat to human wel-being.

We've been told for years that the capitalist free market is a self-correcting perpetual growth machine in which sellers always find buyers, precluding any major crisis in the system.

_Then _the _credit _crunch _of _August 2007 turned into the great crash of September-_October 2008, _leading _one _apologist _for the system, Willem Buiter, to write of"the _end _of _capitalism _as _we knew _it."

As the crisis unfolded, the world witnessed the way in which the runaway speculation of the "shadow" banking system wreaked havoc on world markets, leaving real _human _devastation _in _its wake.

Faced with the financial crisis, some economic commentators began to talk of "wmbie banks" -financial institutions that were in an "undead state" and incapable of fulfilling any positive function, but representing a threat to everything else.

What they do not recognize is that twenty-first century capitalism as a whole is a zombie system, seemingly dead when it comes to achieving human goals.

_Chris Harman _uses _the _basic _concepts _of Marx to show that crises are not accidental features of capitalism, but are built into its very structure, and that only a radical restructuring of the system can save humanity from the recurring crises, wars, and ecological disasters capitalism brings in its wake.

This book needs to be read far and wide. It is a clear, incisive warning of the massive dangers posed by a "runaway system" and the threat it poses for the future of humanity.

\- Graham Turner, author of 7he Credit Crunch

Zombie Capitalism is both timely and hugely valuable ....

This book is an essential read.

\- Socialist Review

Essential reading for anyone who wants to understand the present-day crisis and its place in the history of capitalism.

-Alex Callinicos, author of Bonfire of Illusions

Current Events I Economics

ISBN: 978- 1 608461 -04-2

\$ 1 7

Haymarket Books

www.haymarketbooks.org