Disease of Capitalism оr Decline of Civilization?

Disease of Capitalism оr Decline of Civilization? 

Humankind is sick. Perhaps, very few people doubt that. Even among the participants of Davos Forum. However, even realizing that humankind is sick, whether we have a sound enough idea about the nature of its illness, whether the diagnosis is reliably defined?  Alas, no - the diagnosis is not established. Instead of the diagnosis or explanations a magic word "CRISIS" is being “implanted” persistently into brains of people. If necessary, this “sacral” word is being decorated with various adjectives like “debt”, “financial”, “global”, “trade”, “economic”, etc. And such a substitution more or less satisfies people in the bulk; they are accustomed to trust TV and various “gurus”. In fact, however, this word explains nothing, it merely inspires fear. It is no more than an instance of wrong, false word usage. Crisis is not at all an illness; it is impossible to be sick with crisis – this is nonsense. Crisis is a point of instability of a process, leading to a decisive change.  If one has in mind the clinical course of a disease, there are only two possible outcomes of a crisis - either the patient recovers, or dies. Crisis is by its very essence a short-term state of a system; it cannot be chronic. 

In general, surprisingly many circumstances of now-a-day “crisis” look rather odd. An idea, or more truly - a belief, is being imposed methodically into people’s consciousness that the crisis has arisen unexpectedly, as a natural disaster. Neither the governments, nor presidents, or any «Group of Eight or that of Top Twenty” as well as the team of winners of so-called “Nobel prize in economy” had noticed obvious symptoms of the threat approaching. Thus all they as though do not bear here any responsibility. But when the disaster has already occurred, all they concertedly simulate activity on ostensibly its overcoming, diligently avoiding, however, objective analysis of its roots. 

 Let's mention but some, the most obvious symptoms of the troubles brewing up in the world.

 

• Drastic speeding up depreciation of money (relative to gold).  Throughout two centuries of capitalism in the US the rate of depreciating money was being kept on a rather low level about 0.4 % a year, whereas in the last 35 years it accelerated more than twenty-fold, up to 10%. In the year 1834, one dollar “weighed” about 1.5 gramme of gold, now - about 17 milligrammes. The consequence: Money has lost the ability to perform duly its fundamental functions – to be the measure of value and the means of its storage. Whether can this substance be considered Money thereafter?
• Drastic drop of the efficiency of financial turnover. Half a century ago, the production of one dollar of GDP in the US required about one dollar 50 cents in financial turnover, now – more than 60 dollars.

• Drastic growth of external (National) debts of almost all developed countries. The debt of the US grew about fifty-fold within last 50 years and exceeded now 15 trillion dollars. Total the US debt is still four times greater, about 60 trillion dollars.
• Drastic growth of Derivatives. This is a very tangled “financial instrument”, which allows making big money out of hopes, illusions and risks of its clients. Its embryo existed from of old, but from the middle of the last century the derivatives went into booming growth. Total volume of contracts concluding annually by different mechanisms of derivatives, has attained an “astronomic” level of a quadrillion dollars (thousand trillions). Warren Buffett considering that derivatives decrease the stability of economy, surely had reasons to call this instrument the “financial weapons of mass destruction”. 
• Uncontrollable growth of population of super-rich people whose incomes incommensurably surpass the real needs of realization almost any productive business.With respect to only few super-rich people one can tell that their incomes really correlate with their contribution to humankind progress. Most of super-rich do not produce real values; they gain their super-incomes because they are super-rich and can manage a considerable share of real incomes created by productive structures of society. 

A synchronous display of the symptoms listed above testifies that all they have common roots. They mirror various facets of a single process of global scale and historic significance. This process is nothing but the change of socio-economic formation – the replacement of capitalism by a quite different socio-economic system. There are strong reasons to call the system that is impending as “Neofeudalism” though its vanguard seeks now to mask itself under less worrying name of the “financial capitalism”.  

In the old incarnation of feudal system the owners of land, the landlords were real  “masters of life”, since land at those times was almost the only primary source of energy necessary for subsistence of human society. In the present reincarnation, again the owners, this time the owners of big money, one may call them finlords, claim the superb status of “the masters of life”. Meanwhile the capitalists, due to whose activity the capitalist civilization was created, and who were real “masters of life” in their epoch – they lose their antecedent status and gradually turn into executors of finlords’ demands.

The very “architecture” of social system undergoes radical changes. In the days of classical creative capitalism the economic pyramid of a society was, if considered quite simplistically, two-storied: below – the employees, above – the employers (capitalists). The employees perform work producing certain values; the employers organize their work and create conditions to make it efficient. Hypertrophy of so-called “financial capitalism” means the occurrence of the third storey of economic system. Its uppermost “storey”, where a huge financial power concentrates, actually is not a productive one. Nothing real is being produced there but money – big money - which appears there, as if “from nothing”. Actually, however, nothing appears from nothing, and the big money of the third storey is being pumped in fact from lower storeys, by whose joint efforts real values and real incomes are being created. The share of total income, which goes upstairs to the third storey, is not small but doesn’t satisfy a growing appetite of its residents. Eager for strengthening its power over society, financial capitalism manifests an evident interest to own enrichment even at the expense of reducing incomes of the lower social strata. That is quite logical: a very high degree of economic inequality is a necessary condition of existence and relative stability of a system of feudal type, nо matter either medieval one or neo-. 

The epoch of capitalism is characterized by unprecedented successes in science, technology, democratization of social relations, a certain decrease in inequality, general increase of well-being of people (not everywhere though, but in many countries). One may go on with eulogy for the brave epoch, despite it passes away, but we surely would like to understand, why does the capitalist system cede so easily its positions in live history? In general any evolving system bears in itself the germs of its own decline and is doomed to be replaced, sooner or later, by a system of other design. The time distance between “sooner” and “later”, i.e. the real lifespan of a system depends, however, on its will to self-preservation. Unfortunately, the existing system shows in this respect a surprisingly slack or even perverted behavior. The governments of states, at least of many, manifest full readiness to obey implicitly the demands of bankers, although the latter ones were in fact among the main initiators of the current dramatic events. On the contrary, the opposite side represented by big money, acts vigorously. It pushes the creation all the new international financial organizations, advertising them as a rescue for the world economy. It intrudes its people into state structures: only for some months of the last year the leading posts in the governments of five or more European countries were occupied by bankers. (France had lost a chance to appear among them rather casually).

The capitalist world never was afraid of anything – to connect two oceans with a channel, to construct a huge ship or build three hundred meters high skyscraper, to fly up in the sky, to split atom, to “land” on the Moon … All seemed realizable. Sometimes even the possibility of surmounting fundamental laws of Nature. So was it until recently. Now humankind is afraid of everything – of  uncountable “-isms” (Islamism, nationalism, terrorism, fascism, etc.), of new strains of flu virus, of global warming, of unexpected scientific discoveries, of landing aliens, of falling an asteroid, of absorption by a black hole, and so on. Great nervousness, sometimes even real panic arises because of negligible shifts in negative direction of some so-called «economic indicators». But most of all humankind fears to have known true diagnosis of its illness. Instead it attempts to heal itself by “home remedies”, which were in use a century ago and sometimes helped for a while. This time it is a hopeless way, the more so because there are influential layers of society, whose aim is substitution of capitalism, not its recovery.

It remains to rely merely that humanity, at least its sufficient part, is “adult” enough to set its face consciously against the efforts of authorities to draw it back into state of political infantility.