By Walter Libby
While the industrial revolution has produced technology that borders on the magical, it has also produced historical forces that threaten civilization: peak oil, global warming, and globalization. And while each has their own scenario of catastrophe, it is globalization that appears to be the immediate concern.
What is globalization? In capitalist terms it is the global spread of ideas, products, and culture. Free markets at work, all to the good. This is one side of the ideological coin; other side being Marxism. And the historical flip has apparently come up on the side of Marxism.
While history has introduced some buts in Marxism, nonetheless, his analysis of capitalist is largely intact.
Marx begins the Communist Manifesto with: “The history of all hitherto existing society is the history of class struggles.” And then quickly gets to the gist.
But does history lead there? Not quite. The world has changed significantly.
Marx did not foresee the rise of multinationals and their eventual abandonment of their countries of origin. They are driven not so much by their quest for new markets, but by competition as they chase each other across the globe in a race to the bottom for cheaper labor, fewer regulations, and lower taxes. And when they nestled in communist China, a new market with a billion people, they changed the dynamics of Marxism in a number ways.,
Here, in the erstwhile developed countries, rising unemployment naturally leads to less global demand for China's factories. As the world demands less from China, China in turn demands less from the world (resources), who in turn demands less from China. It's not global overproduction that leads to the collapse of capitalism, it is the lack of global demand; deflation. Somewhere down the road the global economy will collapse. What arises in the free world from the rubble?
Certainly not communism. The workers cannot rise up and seize what is not there. And revolution in Marx's time was a numbers game. That reserve army of employed would have to only go up against muskets and cannons.
But what happens today when the system breaks down? Socioeconomic chaos. So what is chaos? It’s this: the food chain breaks, and everywhere it’s a war of all against all.
A little history: Following World War II was the Golden Age of Capitalism. Enlightened policies towards Japan and Germany played a role in their rebuilding, but a role buttressed as the U.S. turned them into forts to guard against Soviet intrusion; assuring a stable government and their economic development. South Korea eventually fell under our umbrella and became one of the Asian Tigers. All in all, it was a period of huge global demand. And the United States was the immediate beneficiary.
As it stands now The Treasury General Account is held at the Federal Reserve Bank of New York. But understand that it is the Treasury that prints the Federal Reserve Notes, and for a fee, supplies the currency to Fed. Since all official payments of the U.S. government are made from this account., and all deposits, since with the collapse there are no taxes, are now made by the printing press, there is no problem funding the federal government along with providing block grants to state and local governments. Whatever needs to done will be; there are no limits to funding governments or subsidies for businesses.
These are hard times. The manufactured consumer have mostly been off shored. But we now have a solid foundation.
Having a contingency plan is inherently a good thing. And it may be the only way to achieve the ideal; the end of history.
And what of communist China?
It's only going to get worse.