Commentary on Political Economy

Sunday 2 October 2011

Addendum to Post on Bernanke's Speech

Let me summarise and also hopefully clarify the "lessons and implications" that we can derive from Bernanke's latest speech on global capitalist "growth" as it is understood by one of the foremost exponents of capitalist officialdom and academe.

First, Bernanke proposes a model and pattern of "growth" for "emerging market economies" that closely mirrors the model and pattern of development experienced alreasy by the advanced industrial capitalist societies of Western Europe, North America and Japan. Bernanke uncritically accepts and adopts the capitalist notion of what constitutes "growth" and therefore proceeds to indicate a "path of development" that does not at all depart from the essential categories and characteristics of world capitalism from its inception in seventeenth century Europe.

Second, Bernanke makes quite explicit - without necessarily intending to do so - that the apparent "success" of the "emerging market economies" has nothing at all (!) to do with "innovation and progress" or an "evolution" of the capitalist model but rather has everything to do with the mere "extension" of Western-style capitalist exploitation to greater numbers of workers in those countries through lower wages and existing or inferior technologies available in the West. Put in other words, the "growth" of so-called emerging market economies is essentially due to what we have called "absolute exploitation" of poor countries by their new capitalist elites aided and abetted by the Western elites through lower wages than in the West and "the mobilisation of resources" (population explosions, rapid urbanisation, transfer of existing technologies of production and social forms, disintegration of social networks, values and environmental standards).

Third, Bernanke limits himself to suggesting that the "re-balancing or addressing of existing trade and balance of payments imbalances" is all that is needed to reset the global capitalist economy on the path to growth. But this has got to be wrong! For the simple reason that simply addressing balance of payments imbalances can never but never lead in and of itself to higher capitalist "growth"! What is needed instead is "higher profitability"! And this is where the limits and barriers of capitalism arise. We will address these limits and barriers soon.

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