Something for the weekend? As another one commences, you’ll be wanting to uplift, inform and sharpen a mind dulled by the urgent banalities of the corporate world. Try this interview 1 with economist and geopolitical analyst Michael Hudson, whom I regard as the single most comprehensive and accurate voice not only on the Ukraine war but on why, as Eurasia rises and the West declines, the times they are a-changing.
For my baby-boomer generation, its working class in particular, a put-down routinely heard from our elders was “you don’t know you’re born”. We resented it, naturally, but those elders had a point. As I put it in 2019, in a footnote to a post on the Beatles:
To give that older generation – its working class in particular – its due, these were men and women who’d emerged from Depression and WW2 to raise and equip their children for lives of immeasurably greater prosperity, only to see them embrace weird lifestyles and – ingrates all – damn their elders for shortcomings unfathomable. (Paul piercing in She’s Leaving Home: “What did we do that was wrong? We didn’t know it was wrong. We struggled hard all our lives to get by …“)
Twice I’ve stressed that “working class in particular” add-on. This was the class – skilled and unskilled blue collar workers in the West – from which tens of millions escaped in the period 1960-1980. What conditions underpinned this remarkable exodus, taking place as it did in a long post-war boom characterised on the one hand by consumer-led capitalism and the “demand-side” economics of Keynes and Marshall Plan, on the other by cold war on the Soviet Union?
And why did those conditions hit the skids? 2 Why did they give way to the voodoo economics 3 of Chicago School orthodoxy, to a weakening in the West of organised labour as jobs migrated to the global south, 4 and to the fall of the Soviet Union with profoundly negative consequences for humanity? 5
Ironically, my unprecedentedly privileged generation, considered as a whole, is the one least equipped by temperament and world view to answer such questions. I say ironically because ours was the generation which acquired – en masse, courtesy the liberal education then seen as crucial to a techno-managerial class in the ascendant – the analytic skills to do so.
And I say it is the one least equipped to answer them because analytic skills were not the only product of that liberal education. Another was an idealist outlook, in the epistemological sense of seeing the world as driven by ideas rather than material forces. 6 My generation is wont to deplore – not without cause so long as we do as the Christians say, and love the sinner even as we hate the sin – the narrow minded bigotry of our parents. But while they embarrassed us with their racism and homophobia and inability to appreciate freestyle jazz or world cuisine, those parents did have one thing – actually a lot more than one but this will do for now – we baby-boomers are woefully short on. They “knew they were born”.
Which is to say they had, for all the blind spots and prejudices attendant on toil and hardship and painfully limited horizons, an instinctive grasp of realpolitik. They’d been shafted too many times, you see, not to recognise – not in the abstract but viscerally – that money is power, and power is always abused.
Our takes on the world – including but not confined to the seismic events unfolding in Russia’s south-west neighbouring state – will always be deluded if we lack a grasp of realpolitik. On that thought let me hand over to Professor Hudson. You do got eighty-two minutes to spare, right? If not, I urge you to give this great thinker 7 such time as you can salvage from your busy life.
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- Transcript here, should you prefer reading to viewing or listening. Me, I like to don the bluetooth headset and listen on my Samsung Galaxy while pottering about the house or strolling England’s green and pleasant.
- With hindsight we can see the victories of Thatcher and Reagan as synchronising a wider change, now in its fifth decade, marked by the plummeting bargaining power of Western workers, by the accelerating ascendancy of finance capital and, rather more recently but causally related, by the challenge to dollar hegemony posed by Eurasia rising.
- Says Michael Hudson to Ben Norton, “the Nobel Prize is given for junk economics. And probably the worst junk economist of the century was Paul Samuelson [who] made the absurd claim that he proved mathematically that, if you have free trade and no tariffs, and no government protection, everyone will become more equal. At least the proportions between labor and capital will be more equal. Well, the reality is just the opposite.”
- On the export of jobs to the global south, the quixotic vision of Donald Trump had it that those jobs could be “brought back to America” by sheer political will. He was by no means the first idealist (see footnote 6) to fail to grasp the weakness of industrial vis a vis a decidedly unpatriotic finance capital. Some of us are old enough to recall Sir Terence Beckett, director-general of the Confederation of British Industry and as such the authentic voice of industrial capital, promising Mrs Thatcher “a bare knuckle fight” over soaring interest rates he rightly saw as destroying Britain’s manufacturing base in favour of ‘the city’ but, like Mr Trump, wrongly thought he could reverse.
- ” … the fall of the Soviet Union with huge negative consequences for humanity …” This assessment is not at all dependent on a rose-tinted view of the USSR. One outcome of cold war victory was to end the business case for ruling classes in the West making ideologically driven concessions – showing workers a caring capitalism, lest they seek socialist alternatives – as their part of the Social Contract. Another was to strengthen, in a briefly unipolar world order, their capacity to exploit the global south
- That idealism underpins the largely implicit view – I mentioned it in Ukraine in La La Land – of the West as guided by Enlightenment values: understanding, for instance, the abolition of American slavery to be driven not by the needs of capitalism for a free labour force but by an onwards-and-upwards march of progressive ideals. Or seeing WW2 not as seismic shoot-out between rival imperialisms but as Manichean struggle between Good and Evil. Rejecting such idealism does not, ipso facto, make us cynics – nor does it deny the passion and heroism of those who fought to defeat slavery and Nazi poison both. It supposes only that in the last analysis – though without recourse to crass reductivism – we see subjective factors, even very important ones, as taking second place to history’s objective and stubbornly material drivers.
- If you are inclined, like me, to a Marxist worldview you’ll seek to avoid the fixed and finite categories so antithetical to dialectical enquiry. Michael Hudson does at times conflate terms like “early” or “classical” capitalism – and, rather differently, a mixed economy – with socialism. (Note to self: a post is needed on China, apropos Stephen Gowans’ recent outpourings.) At first blush this is plain wrong. As is the implication that capital’s own laws of motion allow, in principle if not in the practice of Really Existing Capitalism, for outcomes other than monopoly based imperialism. But we need to look at where he’s going with these equations. Or if that’s too big an ask, let them be and focus on the cogency and detail of his grasp of why a post-war order formalised at Bretton Woods is – slowly for now – dying: a fact less threatening to humanity than the measures a US-led west is bent on taking to halt that demise.