Hassan Abbasi
2. The Capitalist State and the Hype of Privatization by David Harvey
In Chapter 13 of Volume 3 of Capital, Marx deals with a subject that is the real autopsy of the capitalist crisis, and we are witnessing its stormy and ever-increasing growth today. He describes the rate of increase of capital accumulation exceeding the rate of increase of surplus value produced by workers. Marx describes this situation, which is a direct result of the tendency towards a falling rate of profit, as follows: “Since the total volume of living labour added to the means of production is constantly decreasing in proportion to the value of these means of production, therefore unpaid labour and the part of value it represents are decreasing in proportion to the value of the total capital advanced. Or in other words: A constantly decreasing part of the total capital is converted into living labour, and consequently this total capital absorbs in proportion to its volume a constantly decreasing surplus labour. Although the ratio of the unpaid part of the labour employed to its paid part may grow at the same time. The relative decrease of variable capital and the relative increase of constant capital, although both parts may increase in absolute terms, are, as has been said, only another expression of the greater productivity of labour.” (Volume III, Chapter XIII, p. 15). Tax and financial policies that swallow up the meagre wages of workers, the appropriation and conversion of natural phenomena such as untouched forests, waters and seas, animals, etc., which man has not yet done anything with, into capital and capital accumulation. This law of the diminishing rate of profit is that an ever-larger part of capital in the form of machinery, installations, etc. is set in motion by an ever-smaller part of living labour. Thus, unpaid labour, which represents the part of the value that must be added to the accumulated capital, decreases. Ways to prevent the rate of production of surplus value (unpaid labour of workers) from lagging behind the accumulation of capital arise in the form of the above wells (appropriation of natural resources, etc.). The process of development of production and accumulation of capital dictates that this shortage of capital and the lag of the rate of increase of surplus value from the rate of accumulation must be compensated in various ways. One of the factors that effectively contributes to the increase of the fixed part of social capital in this process is the objects of labour that do not create any expenses for capital because nature has prepared them over many years. When capital annually clears forests the size of Greece (this is the amount in 2014, which should now be much more) by means of planned fires in the forests of Borneo and other Indonesian forests, burning nature and human life with the aim of providing a very profitable area of accumulation and thereby obtaining huge profits and combating the decline in the rate of surplus value, and in this regard, combating the occurrence of a crisis. When the World Wide Fund for Nature (WWF) announced in October 2016 that a third of animal species have already disappeared and by 2050 this figure will reach two thirds, or 75%, of animal species, it does not only mean that 75% of species will disappear, but also that the world’s seas will be emptied of fish and other aquatic animals, which in turn will lead to a decrease in the animals that feed on them. When million-year-old forests are converted into oilseed plantations in a short time, it means that their timber is converted into capital, and their high-quality soil is added to the mass of capital with little investment. The same process occurs in society when capitalist governments finance the costs of war, capitalist crises, school costs, health, etc. through huge loans. This means that they put the working masses into huge debts that are paid for through the tax system, etc. from the workers and their wages. These are the costs of capital, nothing else. It is capital that should train the workforce, prepare the next generation of workers, and treat workers who have become sick and exhausted in the production cycle and return them to the labour process and capital production. All this means reducing the costs of capitalist production, which ultimately means increasing the productivity of labour. Increasing capital accumulation in this way also means increasing the organic composition of capital, increasing the volume of fixed capital that is set in motion by fewer and fewer working masses. What Harvey traces in successive and scattered pages under the title of the onslaught of neoliberalism in America and Britain in the 1980s is, on the one hand, the anti-inflation struggle, and on the other, the struggle of trade unions, city councils, and municipalities. Harvey’s anti-inflationary struggle revolves around the tax policies of the Reagan and Thatcher governments. I have already explained this in detail. But in the second case, Harvey presents the trade unions and municipalities of these two countries as if they were the centres of power of the American and British working class! And the battle is between the Thiers government and the Paris Commune!! As for the trade unions, both in the United States and in the United Kingdom, the arrogant history of these apparatuses of burying the struggle of the working class in the closed rooms of the bureaucratic hierarchy is no secret to anyone. Until the Ronald Reagan administration, the leaders of the American trade unions participated in government meetings related to the labour market and investment and are even officially part of the American ruling class. The local governments, municipalities and city councils of Britain are representatives of the local bourgeoisie of the British government bureaucratic system. These unions only bear the name of the working class of these countries; otherwise, they are, first and foremost, institutions of capital advance, partners and other competitors of the huge international industrial and financial monopolies. This is not hidden from anyone, and the leaders of these unions proudly talk about the role of these institutions in international competition in their annual reports. Therefore, these organizations are not only an organ for controlling the workers’ struggle and generally planning the long-term struggle of the working class in their countries within the framework of the system and laws of capital, but at the same time they have an important share in the ownership of parts of social capital. Moreover, these unions actively play an important role in the planning of capital states, large industrial and financial monopolies. Being involved in the hierarchy of ownership of capital’s industrial and financial institutions is the main condition for influencing the advance planning of production, and these unions, relying on financial power, experienced economists and the lever of controlling the workers’ struggle, play a more important and fundamental role in the stability of the wage labour system than a capitalist, however large. The labour unions of traditional capitalist countries, namely most European countries, the United States, and Canada, follow precise and calculated plans to invest and participate in the boards of directors of capitalist institutions, which not only include earning as much profit as possible and accumulating capital, but also play a key role in terms of strategy and control of labour movements. The history of the shackling of the labour movement of the aforementioned countries is a separate chapter, the current fruits of which are the complete silence of the workers of these countries and their begging for the morsel of bread that the employers’ unions and the capital state throw before them every year as the generosity of the capitalist class, which is not hidden from any worker, not even the workers of these countries. In exchange for this morsel of bread, the working classes of these countries have sold the entire power of the class struggle and their glorious past history. This brief survey determines David Harvey’s place in the hierarchy of the bourgeoisie because the labour unions and their leaders are the only support not only for his opinions but also for all his actions. We said this to prepare the conditions for criticism, to provide one of the main axes of Harvey and his associates’ demagoguery propaganda, namely the capital state and the issue of privatization.
Harvey writes on page 20 of this book, “After World War II, various types of democratic socialist, Christian democratic, and controlled economic planning governments emerged in Europe. The United States itself adopted a liberal democratic government, and Japan, under close U.S. supervision, created an ostensibly democratic but in practice highly bureaucratic government to oversee the reconstruction of the country. What all these different types of government had in common was the acceptance that the government should focus on full employment, economic growth, and the well-being of its citizens, and that to achieve these goals, government power should be used unfettered along the market, intervening in it or even replacing it if necessary. Fiscal and monetary policies, commonly called Keynesian policies, were widely used to reduce business modernization and ensure acceptable full employment. In addition, a class compromise between labour and capital was generally advocated as the main guarantor of domestic peace and tranquillity.”. Before any discussion, it is worth mentioning one feature of Harvey’s views, which is that, like other bourgeois theorists, he gives more importance to the thoughts and opinions of experts, what others say about them and judge them about them, than to their performance. Even when he enters into the analysis of their performance (which rarely happens), the basis of his judgment and analysis is what they have said and defined about themselves. In this specific case, the state is also like this. He first starts with what the capital state, as the public claimant, says about itself and says that it says so and so in their platform, and then when this same Harvey sits down to judge, the basis of his comparison is what these states have said about themselves. Harvey’s definition of the state and the role of the state, whenever it is purified from the huge debris of his generalizations and generalizations, is a definition of the capitalist bottom line. A definition that not only bears no resemblance to the Marxist and labour explanation of the state but is in clear contradiction to it and is just the words and definitions of the bourgeois state about itself. Leaving this aside, we can get to the main issue and continue the discussion. The capitalist state represents the ruling class and is in fact a personified capital that represents, directs and plans the entire social capital and is responsible for its reproduction. Current capitalist states also carry out the aforementioned tasks with modern means and weapons and therefore play a more important role as active agents of capital. The challenge of capitalist crises and helping social capital to emerge from crises is one of the serious tasks that was assigned to the capital state after the 1929 crisis, which today is not limited to the crisis arena but is its daily work and that of capital institutions. The main axis and goal of the capital state is to reduce the costs of reproducing social capital by shortening the necessary labour as much as possible (the labour that leads to the reproduction of social labour) and increasing surplus labour (the labour that leads to the profit of social capital).
Marx says in Chapter 16 of Volume 1 of Capital, “Thus, contrary to Adam Smith, capital is not merely the rule over labour. Capital is essentially the rule over labour whose value has not been paid for. All surplus value, in whatever specific form it later crystallizes (profit, interest, or land rent), is in its essence the materialization of labour time whose value has not been paid for. The secret of the self-expansion of capital is revealed in the fact that capital possesses a certain quantity of the labour of others whose value has not been paid for.” The state of capital, like any state of class society, is not a neutral social force and lever, and its organs function in the same way as any other social unit. In capitalist society, where the motive of profit, accumulation of capital, and production of capital are the main goals, it also includes the state and its institutions. But despite this, the class state presents itself not only in capitalist society but throughout the history of its existence as the public prosecutor, the representative of the whole of society, and the guardian of the public interest. The laws it makes are binding on all classes and it passes them off as laws of the general interest. But it is quite clear that the nature of the capitalist state is not revealed by what it says about itself. These are all claims that the capitalist state makes about its intentions, the reality is the opposite. In judging history, we do not refer to what individuals, kings, rulers have said about themselves, but we proceed from and evaluate what they were and did (quoting Marx literally).
Capital in its state body, through loans, spreads all the burden of expenses on the workers and their families. Even the purchase of bankrupt capital enterprises in times of crisis is paid for from the wages of the workers when the state bails them out. The game of buying and selling bankrupt capital enterprises has a story as long as the history of capitalism for several hundred years. I will return to this story. But what Harvey calls the state as the protector of public property and the like is something else than what was said in these lines. The fact is that neither Harvey nor even the recent generations of social reformists discovered this nonsense. The roots of this kind of interpretation of the state in general and the capitalist state lie in the Second International and in Karl Kautsky in particular. The idea of economic determinism and the induction of the growth, concentration, and monopoly of capitalism as the backbone of socialist production and the growth of socialist production relations within capitalist production relations were among the teachings of Kautsky, who nurtured an important part of the leaders of the Second International, and Lenin also became acquainted with Marx in this culture and from this perspective. This view particularly concerns the role of the state in capitalist relations. Before any discussion, it should be noted and emphasized that no other production relations other than these capitalist production relations based on the purchase and sale of wage labour power, even if all social capital is concentrated in the hands of the state or similar institutions, will arise in the heart of capitalist society, and capitalism only creates capital. It is clear that the development of capitalism creates the material foundations of communist society within capitalist production relations in the form of the development of productive forces, but this has nothing to do with socialism. The main condition for socialist society and its development is the rise and power of the working people who overthrow capitalism and abolish wage labour. Kautsky’s socialist thought revolves around the state. He explains it in his book “Class Struggle” in such a way that his entire socialism is based on state ownership of capital. Nowhere in his writing is there any discussion of wage labour as the basis of the capitalist production relation, but everything revolves around the type of ownership, so much so that in the fourth chapter of his book he mentions ownership 28 times. Note this long sentence of his from the same chapter: “Anyone who understands the conditions that are necessary for the present system of production knows what system those conditions demand when the existing system of ownership is no longer possible. The root of private ownership of the means of production is in small-scale production. Individual production necessitates individual ownership. On the contrary, large-scale production is in the sense of cooperation and social production. In large-scale production, not one individual works alone, but a large number of workers, all the sharers of wealth, work together to produce the total product. Thus, the new means of production are diverse and powerful. It has become absolutely impossible for each individual producer to own his own means of production. When we have reached this stage of large-scale production, two more types of ownership are no longer possible. One is private ownership of the means of production used by common labour. This means the existing capitalist system, with its attendant misery and exploitation for the workers and stifling abundance for the capitalists. The second is common ownership of the means of production by the workers, which means the cooperative system of production and the abolition of the exploitation of the workers. In this system the workers are the masters of their own production and appropriate the surplus which under the present system the capitalist deprives them of.” Lenin also used the same formula when the party at the head of the workers seized power, as in the pamphlet “Commodity Tax.” “To explain this further, I will first give a very specific example of state capitalism. Everyone knows what this example is. It is Germany. In this country we have the latest in the contemporary technique of large-scale capitalism and a well-organized organization which is subordinate to Junker-bourgeois imperialism. Throw away the words on which they are relied upon and replace the bourgeois and imperialist Junker military state with a state of a different social order and with a different class content, the Soviet or proletarian state, and you will obtain the whole set of conditions that create socialism.”
It is clear that all that gives Lenin’s government the sanctity of socialism is his party’s riding on the throne of power. Do you see any difference between the attitude of social democracy a hundred or so years ago and what Harvey is stating today!! Yes, during this time, capitalist governments have planned and implemented two great wars and have experienced great crises by dumping their burden on the working masses. In the hell of capitalism, mountains of capital have accumulated in this period from the labour of wage workers, thousands of times larger than in previous periods. The result of these huge accumulations has been nothing but poverty, homelessness, hunger, displacement, war, the Holocaust, and unemployment for the vast billion-strong masses of workers in the world. Capitalist governments have planned and played the leading role in all of this. Capital, with all its demonic power, including its engineering of ideas and culture, was unable to bring the working class to this day. The current very frightening situation is the product of the reformist twists and turns, the misdirection’s and wanderings that the spectrum of bourgeois communism, reformist parties and circles, thinkers such as Harvey, Piketty, Chomsky and his grave have thrown at the movement of the workers’ class struggle. In other words, everywhere is the howling of the old hyena of reformism that is irritating the ears. By continuing to build parties, unions, and superclass anti-regimes outside the circle of the war against wage slavery, by hanging on the noose of the law and spinning in the maze of the capitalist order, they want the workers not to be freed from this situation but to be obedient disciples of the saviours of social reformism. In a subchapter entitled “Forces and Permanent Changes” in his book A Brief History of Neoliberalism, Harvey discusses the various forms of manifestation of neoliberal policies, namely privatization, free market policies, and the lack of control of capital by the state and shows how external and internal factors cause these problems. Regarding internal factors, as he himself calls them, “it is the upper classes who have accepted the structural changes based on neoliberalism as the path to progress.” He goes on to say that “even the most difficult IMF programs for structural change are unlikely to progress without some internal support from someone.” So far in this part of his writing, Harvey seems to be an observer who describes the events of the day without intervention or strategic conclusions. While he formulates the role of the working masses in the face of neoliberal politics in this way. “The strength of people’s belief in social solidarity and in the importance of traditions of shared social commitment and action has been as influential as the integration of liberalism into the public consciousness. Thus, the cultural and political traditions that form the basis of people’s common sense have played a role in differentiating the degree of political acceptance of ideals of individual freedom and free-market incentives versus other forms of socialization.”
We have seen this aspect of the social reformist attitude towards the capitalist state in previous writings. In the previous chapters of this book, we have understood the meaning of the above sentences well, how the leaders of the unions and other sections of the ruling class stand against the expansion and organization of neoliberal policies and encourage the working masses, under the guise of “integrating liberalism into the public consciousness”, to side with one section of the ruling class against another. As has been said, this is rooted in the obvious point that it is always in the interest of rulers and statesmen to consider the state as the representative of the public, to sanctify its laws and, ultimately, to present the interests of the ruling class as the common good. It is when the continuous and permanent reproduction of capital leads to a certain situation and the relations that are its basis gradually take on a regular and orderly form, and the practical conditions of this need create a mode of production that creates social stability, that all this becomes a solid habit and custom and is considered as a general law of the common good, and all this is what Harvey calls “general knowledge”, “common sense of the people” and people’s belief in the importance of traditions of commitment. Therefore, in every era, the ruling class and the apparatus of publishing its thoughts have thinkers who, despite minor changes in their thoughts, focus on the sanctity of the state and the system of cultural and political traditions. In the past, we talked about Esteban Mazaresh, how he creates the constant theme of all reformist views based on separating the state from capital. Meszaros clearly considers the capitalist society as the bearer of three axes: the capitalist class, the government and the working class. This view is in many of his analyses. Neutral, neutral, neutral, mediator, and the third part of seeing and protecting the common interests of the government is not specific to Harvey’s capitalism, but it is the common feature of all social reformists from the Second International onwards. There is no mention of the new roles of the government, which is always the representative and political power of capital and the guardian of production relations. Have Meszaros and Harvey forgotten the great and decisive role of the government in the expansion of agricultural industrial capital in England and other European countries, in taking agricultural land from small owners, passing the iron laws of ownership in England, France, Germany and Italy, and forming a labour reserve army in the vanguard capitalism of these countries in the nineteenth century. Did this role decrease during the Margaret Thatcher period, the Reagan administration and various periods of European labour party governments.
One of the tricks that Harvey uses to make himself look good, sell his anti-neoliberal ideas, and make his analysis and criticism exceptional is that when he analyses the approaches and practices of neoliberal policies, he pretends that the implementation of these tax policies, economic deregulation, and what he calls “the complete authority of the free market” never happened before his amazing discovery, and that capitalism before that was wonderfully humane, productive and social relations for human happiness, egalitarian, and such nonsense that only comes out of his bag this year. He sees “the complete authority of the free market as synonymous with the fall of people’s power”!! And thus, according to him, until the 1970s, it was the working masses who ruled in America, England, and even cities like New York!! “New York became the centre of postmodern culture and the experience of intellectuals. Meanwhile, investment banks reshaped the city’s economy around financial activities, ancillary services such as legal services and the media, and diversified consumerism. City government became increasingly entrepreneurial rather than social democratic or even managerial… City affairs were increasingly conducted behind closed doors, and the democratic and representative content of local governance was reduced. New York’s working class and ethnic immigrants were plunged into darkness. They were devastated by the racism and drug epidemic of the 1980s, which killed, imprisoned, or made many young people homeless, and by the AIDS epidemic that continued into the 1990s. For New York’s poor, turning to crime became one of the few viable options.” (p. 71, Chapter 2 of the book) Harvey attributes all of this to neoliberal policies that gave free rein to finance capital and blamed the free market for the main culprit. “New York’s management of the financial crisis paved the way for neoliberal practices, both domestically, in the Reagan administration, and internationally… This management proved the principle that when there is a conflict between the integrity of financial institutions and the profits of bondholders, on the one hand, and the welfare of citizens, on the other, the former should be given priority. This administration emphasized that the role of the government is to create a good business environment and not to address the needs and welfare of all people. It must be said that the bourgeoisie knows well the role of individual capital, the state of capital as a planner of social capital and a guard armed to the teeth of this system, and it is David Harvey who has created a state in his brain and intends to convince the workers that the state is something other than capital and its production relations, that the state is between capital and labour, and that the welfare of citizens is the goal of this organ!! Harvey continues this view by analysing the policies of Ronald Reagan and after analysing his financial policy says, “But worst of all, public assets were unconditionally placed at the disposal of the private sector. For example, the National Institutes of Health funded many important advances in drug research in cooperation with pharmaceutical companies. But in 1978 these companies were allowed to pocket all the profits from registration and exploitation rights without returning anything to the government, and from then on, the industry was assured of high profits and large subsidy benefits” (page 77 of the same chapter). One point in this connection is clear and similar relationships between universities, government research centres and companies that are engaged in the production of products and goods in the same fields of capital investment are of particular importance and need to be examined. That is, what these government institutions research is part of the dynamics of capital circulation, and this is a part that entails excessive costs. This research is generally called basic research (Basic Science, Fundamental Science) or basic and has such a characteristic that its unique impact is not limited to the profit and added value of the institution itself, they are an essential part of the capital circulation process. When the results of this research are made available to institutions (both government and private), the value created in them by students and researchers of government organizations (skilled workers) is converted into profit. This basic research generally plays an important role in the growth of labour productivity, the emergence of new goods and the survival of capital. Capitalist governments around the world plan and budget large sums in these areas, which is a guarantee for the continuation of the life of capital and its cycle. These exorbitant costs are financed through taxes on workers’ wages. The tax that is paid on salary does not first give capital to the resident, but it is added to the social capital by these government institutions. In some cases, companies and other institutions enter into these processes by accepting costs, and they take extra profit or the privilege of producing goods from a certain project. The main costs from fixed capital (buildings, laboratories, machines and research tools) to variable capital (small wages of students and some researchers), which are also large costs, are obtained through taxes on the wages of society’s workers. Calling this research a “public asset” is pure demagoguery and arises from the same point of view that the government and various organizations consider it as belonging to the mass of workers, as the capital state pretends, while the workers only pay the expenses of the capital state and not its profits and gains. This demagogic method was founded by Karl Kautsky, the leader of the Second International, and all social reformists of any colour use the same term “public property” to sanctify the capitalist state and consider it socialist. The role of the capitalist state in facilitating the flow of capital does not end with the aforementioned case, but the above explanation also includes all other areas of the capitalist state in general (from central rulers to governorates and municipalities), in the creation of roads, airports, ports, public transportation systems, water supply systems, schools, universities and health centres. It is necessary to state this point here in order to clarify the demagoguery of those who talk about public assets, namely how it is that only this part of the social capital that is in the hands of the capitalist state belongs to the mass of workers, but not all social capital is created by labour and does not belong to the working class. If you are not a demagogue, why don’t you demand all social capital in the hands of workers and in this regard, the abolition of wage labour! Harvey continues his analysis of neoliberal policies to Europe and its utopias of the “welfare state”, starting first with Britain. He says, “Corporate power there was less inclined to support overt political activity (its contributions to political parties were minimal) and preferred instead to exert influence through networks of class and class privilege that had long linked the government, the university, the judiciary, and the permanent state bureaucracy (which at that time still retained its tradition of independence) to industrial and financial leaders. The political situation was also fundamentally different, given that the Labour Party was largely built as an instrument of working-class power and was indebted to strong and sometimes quite militant trade unions. As a result, Britain had created a very extensive and pervasive welfare state structure, never imagined in the United States. The major industries of the economy (coal, steel and motor vehicles) had been nationalised, a large part of housing was in the public sector, and the Labour Party had built up, from the 1930s onwards, a significant stronghold of power in the realm of municipal governance” (p. 81 of the same chapter). Harvey then speaks of the “Labour Government of the 1960s” and names it as a stronghold against neoliberal policies. In these assessments, David Harvey’s class and political base is well-known and needs no explanation. The British Labour Party, which from its inception was committed to the deviation of the British working class in the anti-capitalist struggle and in this way did not fail to claim the title of representative of the British working class, just as other European social reformists also bear such a title and Harvey considers them right because in his opinion, anyone, any party and government has any claim, which is real. I do not mean here that Harvey and his like-minded people have made an academic and philosophical mistake, no, I do not claim such a claim, but on the contrary, like any bourgeois, he considers himself a public prosecutor and says that if the British Labour Party considers itself to be the representative of the working class of this country and his government is also a welfare state, then it is right to do so. In this way, the Communist Party of the Soviet Union and China are representatives of the working classes of their countries, and thus whoever has any claim is right in it, and the reality is nothing else!! In Harvey’s view, class contradictions are only those that take place at the top, in the bourgeois parliament, in their party circles. The financial interests of the bourgeoisie leaders with the state of capital, with other parts of the ruling class, these are class conflicts, in his dictionary there is no class called workers. Everywhere in his book he talks about capital and only capital, and even when he talks about its opposite, he still talks about capital!! And that in the form of capital in the hands of the state under the name of public property. This is also the main theme of Thomas Piketty’s thick book, and since Piketty claims not to have read any work by Marx, I give him the right to ignore the working class, labour, like any other bourgeois, and pretend that capital, out of compassion and humanity, takes pity on this class and allocates it a job with a salary.!!! Harvey cannot teach Piketty any lessons in this matter, as in other cases. For him, capital is everything and there will be no world without capital. Harvey raves about the “onslaught of neoliberalism in the 1970s” without saying a word about the origins and origins of what he calls neoliberalism.
All the ups and downs revolve around the idea that the rise and fall of the capitalist state in general, and in Britain and the United States in particular, at different times, has been the cause of all historical policies and events, including neoliberal policies. In his little world, which does not go beyond the boundaries of newspaper commentary, the capitalist state is not only the cause and effect of events, but also the solution. His analytical method of capitalist crises and the bourgeois solutions in this regard is plagued by the vulgar view that the emergence of neoliberalism in the two countries mentioned above is due to the unpleasantness of finance capital and the top of the financial oligarchy, as if, first and foremost, the dominance of ideas and politics is a condition for the ruling class.
The emergence of the ideas and policies of the ruling class was due to certain economic conditions and, in this regard, to long periods of successive capitalist crises, which were and are indicative of the immense decline in the rate of profit of capital and the reduction in the accumulation of capital due to the lag of the process of production of surplus value behind the pace of capital accumulation. In this regard, the bourgeois state is forced to open all the valves of the accumulation process on social capital. Contrary to what Harvey thinks, the capitalist class and its state are not being pushed back, which, according to him, wants to regain power in this historical period. Rather, a new process of assault on the minimum subsistence level of the working masses throughout the world is beginning under the name of neoliberal policy, which aims to compensate for the above deficiencies. If in this situation the working class is caught in the captivity of bourgeois policies and sacrifices the main goal of destroying capitalism and abolishing wage labour to fight neoliberal policies, including the fight against privatization, the fight for fair wages, and such bourgeois nonsense, it has fallen into the same trap as the goal of the bourgeoisie, namely the parliamentary struggle, determining the minimum living wage, and the fight against finance capital and usury. The political game within the framework of bourgeois parliamentarism takes on a name in every era, and this time neoliberalism has become fashionable, and its function is the sale of state-owned companies and institutions, whose time has come. A part of social capital must have access to them by a certain deadline, which is conventionally done in the daily parliamentary checks and balances and is now being done in a special way under the name of neoliberal policy in a short period of time. Now if Harvey wants to call this an “attack on the public purse” and make a history for it, it does not change the fact that capital is being moved as it is done every day on the London and New York stock exchanges, but this time in another bourgeois centre called Parliament. David Harvey sees the cause of the British economic crisis of 1975 as “a balance of payments crisis coupled with huge budget deficits” (pp. 85-86 of the same chapter). He opens his mouth to say nothing about the root cause of capitalist crises. The cause of the crisis cannot be explained by the crisis itself; this is nothing more than a repetition of the question posed and does not specify any origin for the emergence of the capitalist crisis. He tediously repeats the phrase “crisis of capital accumulation” but with no naked eye can one see what he considers the root of the crisis. Capitalist states, especially after the second imperialist war, fill the budget deficit of their economic programs, which is nothing more than helping to reduce the costs of social capital, with ever-increasing debts every year. These debts are always poured into the accounts of the working class of those countries, and all capitalist states are now in debt several times what the bourgeoisie calls the gross national product. Gross domestic product in the sense of political economy is nothing more than the surplus value produced by the working class and this means that capitalist states expropriate the livelihood of the present and future generations of the working class in order to use this expropriation to help the profitability of capital and the challenge of the capitalist crisis. They take workers into debt so that they can prevent a massive decline in the rate of profit through more work, higher exploitation, and higher taxes. It is the future of workers and their children that is being sold to lenders in international transactions. The result of this sale is nothing more than investment in capital infrastructure, roads, airports, ports, research budgets for government institutions, education and health systems, etc., all of which are capital expenditures, and ultimately it is social capital that benefits from it. So, it is not the budget deficit itself that is the cause of the crisis, but rather its effect and consequence. In the case of Britain in particular, the roots of its government debt go back to the Napoleonic Wars in the 19th century and after the Second World War it exceeded two years of its national income. Thomas Piketty writes in the final chapter of his book “Capital in the Twenty-First Century” that “the public debt (meaning government borrowing from the market) in rich countries is on average equivalent to one year of national income, they have a debt that has not been seen since 1945,” and he then continues, “Europe is facing the headache of resolving the public debt crisis more than anywhere else in the world.” Thomas Piketty, with his populist economic perspective (Marx used the term “folk economist” for those who, after the classical bourgeois economists David Ricardo and Adam Smith, who were as sharp as possible in analysing the capitalist economy, instead of continuing the fundamental analysis of capitalist processes, focus on the appearances of things and events in this economy), says, “Every government uses two main methods to finance its expenditures: taxes and debt creation.” And from his perspective, there is a difference between the two!! Despite his efforts, David Harvey does not add anything to Piketty’s discussion, as his only criticism of Piketty is some academic and categorical criticism. Like our domestic critics, he sees the problems with Piketty’s work in the category of capital and Piketty’s failure to see the difference between it and income. Although this criticism is directed at Piketty, there is no problem with this, and in principle, Harvey will not learn anything from Piketty in this particular case. He and his Iranian thinkers such as Farideh Afari, Nasser Zarafshan, etc. do not have the problem of a lack of study of Marx’s works, these are all “Marxists” and “Marxist” claimants today who know very well what they are writing and talking about. They do not have any anti-wage labour criticism of capital and their struggle, like David Harvey, is against the neoliberal policy of capital. They are also against the laws of the free market of capital! They fight against the sale of public property!! And they take steps for a fair distribution of income! In a word, within the framework of capitalist production relations, they want a clean capitalism that is not contaminated with recent impurities. In social behaviour and action, they also see environmental issues, the spread of poverty and all the misfortunes that capital inflicts on the working class as the ignorance of managers and the lack of proper planning of technocrats. The fact is that if people like Harvey, who until yesterday lined up the workers behind a part of the capitalist class under the name of the fight against imperialism, monopoly and finance capital, the invasion of foreign capital! And this kind of misleading, were obstructing the working class’s struggle against the basis of capitalism, today they are doing the same thing under the banner of the fight against neoliberalism and privatization. They are encouraging the working masses to fight against an unknown monster called the “invisible hands of the market in state institutions” instead of fighting to abolish wage labour and overthrow capitalism. This trend appears in different ways in different circumstances and periods and gathers the disobedient and dissatisfied working masses around the axis of opposition to neoliberalism without really threatening either the capital state or the economic structure of the bourgeoisie. However, sometimes in a city or country, with the gathering of a limited number of people, generally young people with anger and hatred for the dominant system but without any goal or direction, start a way out of the capitalist hegemony and consider this to be the struggle of the proletariat against capital! Not long ago, European newspapers wrote with big headlines about urban struggles in Italy, and Harvey’s followers attributed all this to the anti-neoliberal struggle of the current Italian government. According to them, the referendum of December 4, 2016, in Italy revolves around the axis of the invisible hand of the market on state institutions, which now the “neoliberal government” of Italy intends to weaken the power of local governments in favour of political centralization! The government of Matteo Renzi, the heir to the crisis-ridden Italy of 2008, wants a government that even reduces the power of the Senate in favour of the central government. The term “invisible hand of the market,” which shines throughout David Harvey’s works as the economic dimension of neoliberal politics, aims to explain the entire economic underpinnings of Harvey’s anti-neoliberal ideas. So, what are these invisible hands and what does the market mean in general?
If we are to explain the term market from the perspective of bourgeois political economy, the encounter and exchange of goods and capital in which the relationship of goods-money-goods and also money-goods-money is established is called the market. This is not necessarily in a specific place or time but is a constant process that flows with intensity and weakness. These exchanges have been going on even before capitalist production relations and after the development of industrial capital, they naturally acquired the nature of the capitalist market. In capitalism, a specific commodity, namely the labour power of the worker, is also exchanged. Therefore, commodity-money exchanges do not have any code or astrolabe that we can call them invisible hand. As long as capitalism exists, the market, i.e. the exchange of commodity, capital and labour power, is also a necessary part of capitalist reproduction. This is inevitable and necessary even in Soviet and Chinese state capitalism (see Appendix 1 at the end of this article, where workers’ struggles over wages are evident both in the normal process of buying and selling labour and in workers’ struggles, and also see the section on the social insurance system in China in the same appendix, which shows the capitalists’ struggle to gain a share of this plunder). Now, why Harvey calls it the invisible hand is rooted in his ideas and demagoguery, which, relying on a kind of government concentration and tax system, pretends to control the market. This is just a pretence. In Iran, China, the former Soviet Union, and the entire capitalist world, where labour is bought and sold as a commodity, talking about the invisibility of its purchase and sale is a lie and pure demagoguery, and the workers who sell their labour feel this with their own flesh and blood every day and every hour. The fact that Harvey intends to bring incomes closer together through the tax system will have no effect on the market mechanism, that is, the relationship between buying and selling commodity and capital, which means that his tax system will also operate in this relationship. All the fuss that Harvey has made about the market and the fight against it is for nothing. He talks like Don Quixote about the fight against the market in order to block any formation of a real anti-capitalist movement of the working class. The market, despite its importance, is only a place for the manifestation of goods and their exchange, but what is the hallmark of capitalism, what determines the content of goods and where value is created, is not the market but the arena of production. This is true not only of the market and its functions, but especially of the previous discussion, namely what Harvey and Piketty call the equitable distribution of income. Both Harvey and Piketty start from the sphere of circulation of commodity, labour, and capital, and their solutions remain within the same scope, while any economic formation, including capitalism, can be explained only by referring to the form and mode of production. It is production that determines the subject of circulation, its nature, and everything else. The price of goods, including labour power, is determined in the market and under the pressure of competition. But all the values that are transformed into prices in the market and under the dominance of competition are created and released to the market in the sphere of production. The necessary price of labour is also determined through the necessary means of subsistence of the worker, which are produced by the workers themselves. All values and surplus values arise in the sphere of production. But it is in the market that surplus value is transformed into profit and the rate of surplus value into the rate of profit. This is done under the pressure of competition between different capitals. Competition determines how surplus values are distributed among capitals; for this, the hypothetical base rates of profit in different spheres are transformed into a single rate. As a result, what is real is that the rate of profit is formed in the market, but this profit itself is generated in the sphere of production. In this way, these two bourgeois thinkers blow the trumpet and search for their ideal society in the sphere of competition and circulation. Harvey and his associates have no problem in the sphere of production and do not want any change in it, which is why we do not see any trace of the production of commodity, the production of capital and the creation of profit anywhere in the works of these philosophers. Like all bourgeois philosophers, they see the problems of capitalist production relations in the sphere of distribution of goods, wage prices and the circulation of capital, and this is where they want to control and regulate capitalist relations so that they are better displayed and guarantee their survival. Our philosopher, who bears the title of the Marxist of the century, does not understand that Marx explores capitalism in relation to the production of surplus value. He begins with production. According to him, he considers circulation, consumption, distribution and everything else to be examinable “under the ethereal light” of production. It seeks the destruction of all capitalism and the abolition of wage labour. With the anti-neoliberalism banner in one hand and the tax system and so-called market control laws program in the other, Harvey does not realize his great contradiction, which itself requires a large bureaucratic apparatus that acts in exactly the same way that Margaret Thatcher’s government and the current Italian government act against local governments and institutions. For example, to explain Harvey’s contradiction, consider a system of concentration of financial capital, industrial capital and a huge oligarchy of the Revolutionary Guards that fights against the neoliberal policies of the Hassan Rouhani government. The farce that these two have created in the Iranian political arena is not hidden from any worker, but nevertheless the perfection of David Harvey’s aspirations.
David Harvey’s illusion goes further, as he considers Bill Clinton and Tony Blair, former British Prime Minister, Bush’s partner in the Iraq war, to represent the working class in these countries. Harvey writes, “Their greatest achievement (Ronald Reagan and Margaret Thatcher) lies in the fact that both Clinton and Blair (US President Bill Clinton from the Democratic Party between 1993 and 2000 and British Prime Minister Tony Blair from the Labour Party between 1997 and 2007) found themselves in a situation where their room for manoeuvre was so limited that they could not stop the process of restoring class power, except to maintain it against their conscience” (p. 91 of the same chapter). Harvey is constantly making new discoveries. For example, Blair and Clinton were also defenders of workers’ rights!! David Harvey’s interpretation of neoliberalism is limited to politics, to individuals, and how it manifests itself. That is why, immediately after his presentation, he speaks of “how neo liberalization was realized and by whom.” This interpretation is quite like the interpretation of some artists of art, a metaphysical interpretation. He also does not see the social existence of man as the creator of his thought and politics. On the contrary, throughout his writings, he believes that it is the policies and thoughts of neoliberal representatives that, in his opinion, create the social existence of capitalism after 1970. For this reason, the cause of the changes in the relationship between labour and capital is also considered to be neo liberalization itself. The accumulation of capital in the hands of capitalist states, the implementation of Keynesian policies and many such policies as a result of economic crises, political developments and revolutions, major bankruptcies and, in short, the current necessities of capitalist production relations and its challenges are not the reason for adopting certain policies, including neoliberal policies, but rather the adoption of these policies is considered the cause and Harvey once again blows his trumpet. When the entirety of social capital and capitalist production relations are threatened with overthrow and destruction, adopting any rational method of the time is the right thing to do. The fact that politicians and government managers plan for such a day and in such circumstances is also one of the duties of the capital state, so what is Harvey’s fuss about? Does he expect anything else from the statesmen and managers and planners of the huge apparatus called capitalist states! All the pages of Harvey’s book are full of socialist expectations!! It is from such a government, and this is nothing more than demagoguery and creating illusions in the minds of workers who make the government a place of reference and the Kaaba of their aspirations. The main reason why Harvey immediately proceeds to describe the role of thinkers and writers after proposing the category of neoliberalism cannot be other than that he insists that thinkers, including himself, are always moving ahead of what is actually happening. This is the essence of his metaphysical view, and this is why people and individuals, especially opinionated individuals, play a historical role in society in his system of thought. Since in his system of thought, classes and class struggle not only have no role but also do not exist at all, therefore the society he is discussing is composed of individuals, and the differences between these individuals are not based on class differences but on their intellectual differences. Despite his claim to be a Marxist of the century, Harvey did not even learn from Marx that “thought has been afflicted with the calamity of matter from the very first day.” According to Harvey, it is these individuals who have driven capitalism towards neoliberalism. It is not capitalism! Under the pressure of its destructive and crushing contradictions, it has seen its way of survival in an increasingly brutal attack on the workers, both present and absent. The issue is not whether or not neoliberal policies will occur. Of course, such policies, like other policies in the arena of class struggle between different sections of the bourgeoisie, are adopted within the framework of parliamentarism. The issue is that this explanation does not seek the roots of bourgeois policies but only repeats the main question and states the same events that once took place and are now being described by a thinker like Harvey. For this reason, these wordings are not able to explain the stated problem, but rather repeat the problem once again, or in other words, they pretend to be a cause-and-effect relationship. In the second chapter of his book, entitled “Making Consent,” Harvey proudly explores the neoliberal policy of the US government in the 1970s, which, according to him, except for “upper class people” and himself, even the “left movements” of that day failed to realize, and he reveals evidence to us! Which, in their entirety, shows that the US government, politicians and senior technocrat managers, along with the majority of American companies (250,000 companies, according to him), are planning for American social capital. The result of this planning is the creation of neoliberal policies, including the sale of state rights to discoveries or, as he puts it, “the invasion of public property.”
Now the question is whether this same vast and long administrative apparatus, when necessary, planned to the same extent and even more haphazardly for American social capital and the purchase of its bankrupt institutions during the beginning of the capitalist crisis of 2008-2009. The result of the latter was the rescue of capital in danger of destruction, how the latter was not even worth recounting in Harvey’s opinion, but to justify his views on the danger of neoliberalism! He examines all the offices and letters of the American capital government and appropriates the title of this discovery to himself. The answer is other than that the capital government is just as much responsible for planning, directing and strategic responsibility for social capital during periods of calm and the process of normal reproduction of capital as when it is distributing the burden of the capitalist crisis to the workers. And also, the answer: Isn’t it true that if Lenin and the Second International once removed capital from the proletariat’s class struggle under the guise of anti-imperialist, anti-finance capital, and rotten monopoly capitalism slogans and divided capital into good and bad, advanced and backward? Today, when anti-imperialist and popular slogans no longer have a buyer among the workers, Harvey and his associates are doing the same thing under the guise of criticizing neoliberalism.
The process of privatization of governments, which is one of the main points of Harvey’s arguments in his fight against neoliberal policy, operates, as explained earlier, according to the laws of capitalist political economy, which governs every purchase and sale of goods. The capitalist state of Iran operates in this regard in the same way as the Greek government, Margaret Thatcher’s government in the 1980s in Britain, and the processes of selling industries, banks, etc. in Sweden, or any capitalist society you can think of. The initial conditions for the sale of companies under the control of the state of capital, which Harvey, like all social reformists, demagogue sly calls “public goods,” are that these companies must be saleable, their labour productivity and organic composition of capital must be marketable, they must have normal production costs, they must have little debt, and in the meantime, the proportional productivity of labour in the bourgeois political economy is the smallest number of workers against the largest amount of fixed capital. Otherwise, they will not create a significant incentive for capitalists to buy. This process was exactly the same as that followed during Margaret Thatcher’s time, and it is the same that is always ongoing between different sectors and areas of capital advance. The massive selloffs of state-owned enterprises in Europe in the 1970s had the same roots as the selloffs of Greek state-owned enterprises after the 2008 crisis, which had once been state-owned by capital for the same reason. Neither their state-owned acquisition nor their sale is the result of any bourgeois policy but are both the result of circumstances beyond the control of the capitalist state. The policy of buying or selling by politicians and technocrats is not itself the cause, but the result of circumstances beyond their control. Capitalist statesmen do what the imperatives of production, profit, capital accumulation and the mitigation of capitalist crises demand. This is a process that Harvey acknowledges, as he writes: “Steel, electricity, gas, oil, coal, water, bus, rail and a host of smaller state-owned enterprises were sold off in a huge wave of privatization. Britain pioneered privatization by showing how to do it on a relatively large scale and in a way that was profitable for capital.” But Harvey nevertheless speaks in the following pages of Thatcher’s “revival of class power,” and this is only due to her demagoguery, which pretends that the capitalist state is independent of the two main classes of society, workers and capitalists, and is seen as the mediator and saviour of the working class. Thatcher’s government, like the clerical state or any other capitalist state, is an institution of the capitalist class, the centre of political, military power and planning of social capital of any capitalist society. It is Harvey’s demagoguery that introduces Reagan as a representative of the power of the American ruling class and Clinton as a faction that stands in front of the power of the American ruling class! Marx writes in The German Ideology in the section on Social Being and Social Consciousness on this subject as follows: “The social structure and the state constantly emerge from the life process of certain individuals, but individuals do not appear as they appear to themselves or to other people, but as they actually are, that is, as they act, engage in material production and, in other words, as they work within the limits, backgrounds and material conditions independent of their will.” Tony Blair’s performance as a capitalist statesman makes it seem that capital has been necessary. His government’s participation, along with another criminal of capital, Bush, in the devastating war in Iraq, which is and is not, set the working class of Iraq and the region on fire. We, the workers, are the standard for recognizing his class position, not what he pretends to be, and Harvey also repeats this. Thus, the government that Harvey portrays to the workers is not an impartial and neutral class arbiter, but a fraudulent representative, and in this case, the cruellest capitalist government. But Harvey’s arguments are even more shaky and deplorable because he says that when the neoliberal state “disturbs the general character of the state”, then this state becomes the representative of “elite and experts” and suddenly becomes not an organ of the ruling class power but an “attempt to restore class power”. While this same state in Clinton’s hands represents the oppressed bourgeoisie!! In this way, Harvey is the founder of a set of definitions for the state that replace each other whenever necessary. When the state deregulates the economy, sells state-owned economic institutions and, as he puts it, “opens the invisible hand of the market”, this state is called an “attempt to restore class power” and when in its subsequent political action it changes tax regulations it is called a “welfare state”, a “class-neutral state”, “urban socialism of the Greater London Council” and even a “workers’ state” in England!! By establishing an independent and impartial system called the government, Harvey drags it to wherever he sees fit and produces the necessary results for the purpose he has set in advance, rather than analysing reality. Harvey uses this method throughout the book and in discussing various topics. In Chapter 2, page 70, when he discusses the New York City financial crisis of the 1970s and examines the conditions that lenders set for the local government, he suddenly introduces the New York City government as representatives of the working class and the founders of the welfare state and says, “But the investment banks did not turn their backs on New York City. They used this opportunity to rebuild it in ways that suited their agenda. Creating a good business environment was a priority, that is, using public resources to build infrastructure suitable for business (especially in the field of telecommunications) along with giving subsidies and tax incentives to capitalist companies. The welfare of the companies replaced the welfare of the people.” Until the financial crisis, New York was a city of the people, for their welfare, not for good business. This is the method we see again and again in Harvey’s extremely childish analyses. Interestingly, in all these cases, what existed before belonged to public resources and public property, and there are no mention of capital and its state. Suddenly, by adopting neoliberal policy, they find the title of rebuilding capitalism, restoring class power and elite interests. The same kind of watery analysis based on bourgeois parliamentarian data is also used to analyses the crisis of capitalism in England in the 1970s, the rise of Thatcherism and Harvey’s so-called English neoliberalism, the rule of the Labour Party and its role in the defeat of the British labour movement. In this analysis, too, the gold rush between the various factions of capital led by the Labour and Liberal parties is taken so seriously that even the IMF’s siding with the Liberal Party against the Labour Party is a pretext for the latter’s victimisation. Harvey examines this period on page 85 as follows: “The Labour government failed to meet the terms of the agreement with the miners and its financial problems increased. The balance of payments crisis coincided with huge budget deficits. In order to obtain credit from the IMF in 1975-76, the government had two options: either to submit to the IMF’s mandatory budgetary constraints and austerity policies, or to declare bankruptcy and sacrifice the credibility of the pound sterling, thus inflicting a fatal blow to financial interests in the City of London. The government chose the first option and implemented severe budget cuts in welfare state spending. The Labour government acted against the material interests of its traditional supporters.” Harvey presents a scenario of a gold rush between different factions of British social capital in a way that seems to describe the battle between the Parisian working class at Versailles and the German forces (Bismarck) in the Paris Commune!! The same method of analysis is also used for neoliberal policies outside Europe and America. Harvey writes in Chapter 3, page 106. “James Baker, the Reagan Treasury Secretary… used the International Monetary Fund to impose structural adjustments on Mexico (Harvey means the Mexican government and its central bank) and to support the New York banks in fulfilling their obligations… In the international environment, this means extracting the surplus value of the poor people of the Third World countries to settle loans with international banks.” And he then goes on to clarify for us the nature and intentions of the story that “the extraction and taking away of surplus through financial mechanisms is an old imperialist practice.” The surplus value produced by the working masses of Mexico, Brazil, Argentina (these are all the cases that Harvey lists for us to clarify his point of view) that accrues to the common or domestic capitals of these countries, is called “surplus value”!!! This work of domestic and foreign capitals is considered “the plunder of the working masses and the national bourgeoisie”!!! The same misleading inversions that were made not so long ago by the Maoists, Harvey also uses the term “poor people of the Third World countries” in the above sentences. In these countries, he finds it futile to look for capitalist governments like the British Labour government, which is why he resorts to the categories of people and imperialism. Harvey’s limited world, whether it includes only Europe and America or extends to other parts of the capitalist world, is enclosed between two parts of the bourgeoisie. On one side are powerful finance capital and international financial institutions, which he believes are the saviours of neoliberal policies, and on the other side are the borrowing bourgeoisie, weaker in terms of capital and local governments. This division seems very familiar. This was the same division of capital in the way that was used until recently to align the working class of capitalist countries such as Iran, Mexico, Argentina, Brazil, China and India behind their domestic bourgeoisie under the name of the national bourgeoisie against the larger and more powerful competitor, called finance capital, monopolies and finally imperialism. The goal was also clear. The working class will ignite the great struggle for a greater share of the first part of the world bourgeoisie against the other part. Harvey’s developing countries, which include powerful capitalists such as Brazil, Mexico, Argentina and India, annually share a significant part of the surplus value produced by the workers of these countries with other international capitals. Harvey’s stagecraft, with the long and short dramas he weaves together, is as old as the history of capitalism. If Harvey doubts the role of the International Monetary Fund, the World Bank and the like in supporting larger and more organically composed capitals, it is his problem that he does not understand the first law of capitalism. The regulation of the relationship between the different sectors of international capital, the distribution of the total surplus value resulting from the exploitation of the world’s working class among the different spheres of capital and the realization of the desired rate of profit of the more concentrated and more organically composed sectors of capital, can be justified in the competition between its different sectors. Meanwhile, the mass of Mexican, Brazilian, Iranian, Argentinean, Indian and Chinese workers only bear the burden of producing these surplus values on an ever-increasing scale. They do this in a situation where their standard of living is not only not improving, but is getting worse and worse every day, the millions of workers who go to bed hungry. This Harvey demagoguery is the same old policy that the theorists of the people’s struggle against imperialism established a hundred years ago and which he now calls the struggle against neoliberal policy. The conventional process of the capitalist state’s work in bourgeois planning and directing capitalist society, which is the routine and usual task of a class state, and in this case the capitalist state, is suddenly called “neoliberal state social policymaking” in Harvey’s dictionary of categories and justifications. He cites the example of China and Russia after the collapse of the Soviet bloc, where “neo liberalization has led to an increasing reliance on public-private sector partnerships…businesses and corporations not only work closely with state actors, but also play a significant role in formulating laws, deciding on public policies, and establishing regulatory structures,” or “the state usually provides laws and structures that benefit corporations, and in some cases, special interests such as energy, pharmaceutical, agribusiness, and the like.” These are the sins of neoliberalism in tarnishing the sacred space of capital that Harvey never forgives!! Similarly, in the last chapters of his book, Harvey examines the influence of neoliberal policies in East Asia, and here too the whole issue revolves around the difference and small gap of contradiction between different sectors of capital and generally the capital in the hands of the central government, local governments and municipalities, and individual capitals and financial and industrial giants. From this angle, he examines the operation of this policy in Germany, France and Scandinavia, especially Sweden, which ignites his anger against this policy in front of the Kaaba of his aspirations, the Swedish government. As for the emergence of this policy in China, Harvey, along with all the social reformists who admire the bourgeois reformist ideas of Mao and do not like the policies of the generation after him, analyses it in a chaotic manner. This topic is so important to him that he devotes the entire fifth chapter of his book to it. Although this chapter contains no new points, I will mention some aspects in connection with their commonality with the discussions to date. Harvey writes in the introduction to this chapter: “Although China had not abandoned egalitarianism as a long-term goal, Deng Xiaoping said that the individual and local initiative must be freed from restraints in order to increase productivity and generate economic growth. The consequence of this was that a certain degree of inequality would inevitably arise… Under the slogan of a well-off society… Deng Xiaoping focused on four modernizations: in agriculture, industry, education, science and defence. These reforms sought to bring all the market forces into the Chinese economy unconsciously. The aim was to stimulate competition among state-owned enterprises in the hope that this would foster initiative and growth.” This policy of Deng’s is precisely the policy that Lenin had first established in the Soviet Union, and Stalin tried to revive the Soviet economy in international competition by making it clear that Soviet society and its workers were producers of value and that for healthy competition to be healthy, productivity had to rise. Therefore, it is only Harvey’s naivety about Chinese state capitalism and its politicians that says they were unaware of the consequences of their thoughts and actions. Lenin, Stalin, Mao, and then Deng were aware of the capitalism of their societies, but they call state capitalism ruled by a party under the name of workers socialism. In their dictionary, socialism is an idea and theory that materialized by bourgeois thinkers through a party organ, and it is enough for the millions of workers to become its unpaid soldiers for this idea to be realized. The parameters and factors that he lists under the title of neoliberal policies are as old as the history of capitalism. As long as capitalism has existed, there have been contradictions between different sections of the capitalist class, the market has already existed, and with the emergence of the capitalist mode of production, it has been the place of circulation and organization of capital, the formation of prices, the determination of the average rate of profit, etc. It is not the discovery of Deng Xiaoping, Lenin and Stalin that makes the growth of labour productivity possible in the competition of capital! Chinese state capitalism could not have grown without the global capital market and the exchange of goods produced by China’s wage labour force, so it is obvious that the policymakers of the Chinese capitalist state will open the doors of China to capital, technology and goods. This has no specific title other than following the laws of capitalist political economy in the conventional way. For Harvey to attribute China’s economic progress to neoliberal policies in a given period is like putting a flag over the Himalayas that says, “This is the highest peak in the world!” The compliance of every economic unit, whether a country or an industrial unit, with the laws of capitalist political economy is as obvious as the very existence of this production process (for further clarification of this issue, i.e. the functioning of the laws of capitalist political economy in China and every other capitalist society, see Appendix 1 at the end of this article, where you will witness the daily struggle of Chinese workers over wages and working conditions, the competition of capital, whether public or private, domestic or foreign, over the surplus values produced by hundreds of millions of Chinese workers, the role of labour productivity growth in eliminating workers’ unemployment and increasing the amount of profit when the rate of profit falls, as well as the ruinous houses and the influx of hundreds of millions of poor peasants into the cities to sell their labour power at the cheapest price under the worst working conditions).
Harvey writes in the same chapter, “If it had not been for the simultaneous and seemingly unrelated transformations in the advanced capitalist world about how markets work, neither would these reforms have had the significance we now attribute to them, nor would China’s astonishing economic development have taken the path it has chosen and achieved. The growing political power of neoliberalism over international trade during the 1980s opened the whole world to the forces of financial change. China’s stunning emergence as a world economic power after 1980 was to some extent an unintended consequence of the neoliberal turn in the advanced capitalist world.” This kind of explanation of the world of capital and the expansion of capitalism is like saying that if the capitalist world did not exist with its economic laws in operation, no country, including China, would be capitalist!!! Harvey tells us about the free capital market and introduces it as a determining factor in the progress of capitalism in China. Glory to God, what discoveries would not have been made if Harvey had not told us about them! Harvey pretends that capitalism is something other than the laws of its political economy and that these are two different areas. As if neoliberal policies, including the free capital and commodity markets, are unbalanced relations in the relations of production of capitalism. In Harvey’s mind, neoliberal policies exist and are formed in the minds of politicians and managers, and they inject and impose this into these relations of production, and not vice versa. The laws of bourgeois political economy, including the functions of the free market of capital, are the human expression of those things and trends that actually exist, and the rulers of capital, even when they are the guides of large capitals, are not their creators but only their executors. Moreover, if Harvey believes this about the development of capitalism in China, what justification does the development of these relations have in the decades before 1980 in East Asia, such as South Korea, Malaysia, Indonesia, and Japan, etc. during such periods. Should there have been Thatcher’s and Reagans in such periods for the economic wonders of East Asia to take shape? Harvey continues to attribute everything that capitalism has brought and is bringing to humanity, that it is increasing the severity of the disasters it inflicts on the working masses every moment, adding new areas to the areas of capital accumulation, and closing the way for man to breathe, all to neoliberal policies. He strangely insists that “capital is inherently free from defects. “Every flaw is from neoliberalism”!!! Everything he lists in his book under the title of this policy is not that it is not true, but a hundred times worse. The difference between Harvey’s statements and reality is that he attributes all these disasters to neoliberal policies, the openness of companies, the free market of capital and commodity competition, privatization, and so on, and thus decomposes capitalist production relations into separate components and sanctifies the totality of these relations as the basis of the wage relationship. He claims to have discovered a contradiction between individual freedom to choose goods and what he calls the “power of determination” of companies. He formulates the problem as follows: “If corporate power steals your personal freedom, then the promise of neoliberalism will not go anywhere.” Harvey is trying to create in us the impression that capitalism itself is not a bad thing, but that it is the neoliberal policies mentioned that should be hated and are the cause of all human misery. Once upon a time, in the rural situation and the patriarchal peasant family, man consumed whatever he produced, and at that time all these products were useful to the public, and the purpose of production was basically to create a useful product that was needed for life, and man in these societies was always the purpose of production. When commodity production became dominant, the purpose of production was not to meet the needs of life, but to exchange and sell it. This process reached its peak in capitalism, when labour power became a commodity. The purpose of production became only profit and profit again. The result was that in natural production, where man produced for his daily needs, he had the possibility of choice and freedom of action within the limits of his productive power. When money becomes capital and the worker, by selling his labour power, is separated from his work and the product of his work and determining the fate of this product, it is only capital and the capitalist who decide. The worker has nothing else to sell but his labour power, and he does not even determine the price of this power.
The basis of the alienation of labour, that is, the loss of the conditions for influencing and intervening in what is happening, reaches its peak when the worker is separated from the product of his labour and his free intervention in the labour process is eliminated. Where are his freedom and influence? The worker’s separation from his labour forms the basis of his alienation. This is especially intensified by the greater division of labour and the mechanization of production. The division of labour turns the worker into an interchangeable piece of equipment, and the growth of capital accumulation places him more under the influence of the product of his labour, capital. The wage labour is not only alienated from the product of his labour, but dead labour in the form of machinery dominates living labour, that is, him. Man is a slave to the product of his labour. Here, the talk of freedom of choice is pure demagogy. Even the capitalist, who owns capital, although he has the power of choice and the freedom to invest and choose what to produce and how, in general, he also only talks about capital. Harvey not only does not understand Marx’s critique of political economy, but his views belong to a period before capitalist industrial production had yet begun. Yet he is obsessed with the idea of capital control and consumer choice rather than the determining power of capital, or as he likes to say, corporations. Marx says in the first chapter of Capital, Volume 1, Chapter 12, about the development of capitalism from workshop production to industrial production: “Political economy, which first emerged as a special science in the period of workshop production, examines the social division of labour only in terms of the division of labour in workshop production, that is, as a means of producing more commodities with the same amount of labour and thus accelerating the accumulation of capital by making commodities cheaper. The view of the writers of the classical period, who were concerned exclusively with quality and use-value, is in striking contrast to this increase in quantity and exchange value. According to them, commodities are made better as a result of the separation of the branches of social production, the various human tendencies and talents gain a suitable field of action, and if man cannot restrain himself, no significant results can be achieved anywhere. Hence the division of labour improves both the product and the producer. If they sometimes mention the growth of the quantity produced, it is only in connection with the greater abundance of consumption. They make no reference to the exchange value or the cheapening of commodities.” Harvey insists on returning capitalism to the good old days of the factory, but this utopia remains only a dream. All the freedom he boasts of in bourgeois society is freedom of competition between capitalists. He very demagoguery equates the election of a president or a bourgeois parliament every few years and the checks and balances of the various sections of the capitalist class with the right of the working masses to freely choose their own destiny in work and life!!!
When he says in defining the contradictions of neoliberalism, “Despotism in imposing the market is incompatible with the ideals of individual freedom. The more neoliberalism moves towards the former, the more difficult it becomes to maintain legitimacy in the latter, and the more it must show its anti-democratic face,” he is in fact revealing the bourgeois liberal’s narrow-mindedness of capitalist production relations, of freedom of choice. What Harvey lists under the headings of “privatization and commodification, financialization, crisis management and manipulation, state redistribution, commodification of everything, and environmental degradation” in the sixth chapter of his book has been a characteristic of capitalist production relations since the emergence and expansion of industrial capitalism. He attributes all of this to neoliberal policies and even seeks the root of capitalist crises in neoliberalism!!! “Preserving the integrity of the financial system can be important, but the irresponsible individualism and egotism of the operators within it create speculative instability, financial controversies, and chronic instability…International free trade requires global rules of the game and creates the need for some kind of global governance (for example, through the World Trade Organization). If crises are to be avoided, removing state supervision from the financial system will facilitate the emergence of behaviours that require the reintroduction of supervision.”
The capitalist system needs preachers like Harvey who will denounce the irresponsible individualism of capitalists, reduce the arrogance of its managers, and control capital itself through international capitalist organizations!! To avoid capitalist crises, it is enough to monitor the behaviour of arbitrary and irresponsible managers!! And this requires the creation of vast and long bureaucratic capitalist apparatuses to control capital itself. For him, the commodification of everything is not due to the nature of capitalist production relations and its need, but rather to specific neoliberal policies, and in this process, the emergence and growth of fascism, nationalism, and extremist religious groups are also referred to the unbridled freedom in neoliberalism. “The movement towards market freedoms and the commodification of everything can easily go unbridled and create social chaos. The destruction of all types of social solidarity and even the very idea of society leaves a void in the social system. At this point, it becomes extraordinarily difficult to combat the anarchy and control the antisocial behaviours that arise from that vacuum, such as delinquency, pornography, etc. The reduction of freedom to freedom of exchange abandons all those negative freedoms that Karl Polanyi saw as inseparably related to positive freedoms. The inevitable reaction to this situation is the creation of social solidarities, albeit along different lines of politics, namely the revival of interest in religion and morality, in new forms of associationism (for example, around issues of civil rights), and even the revival of older political forms (fascism, nationalism, and the like).” You can see the similarity of this nonsense with what the flag bearers of the anti-imperialist struggle attributed to monopolies, finance capital and the parasitism of capital not long ago. Until yesterday, the flag bearers of the popular struggle, composed of a part of the bourgeoisie, tried to line up the working masses against another part of the bourgeoisie. In this way, they dressed up the whole of capitalism in a sacred robe and attributed all the problems of the workers to an entity called imperialism. Today, the Harvey’s replace imperialism with neoliberalism in order to block, in the same way, any radical orientation of the workers’ movement against the basis of capitalism. Harvey summarizes other functions of neoliberalism as follows: “The process of neo liberalization has required a lot of creative destruction. This process has destroyed not only the structures and powers of previous institutions (even questioning traditional forms of state sovereignty), but also the division of labour, social relations, welfare provision, technological complexes, ways of life and thought, reproductive activities, belonging to the land, and the desires of the heart. Since neoliberalism values market-based exchange as a moral system that can itself guide all human action and replace all previous moral beliefs, it emphasizes the importance of contractual relationships in the market.” For Harvey, the capitalist state, both when he believes it represents the workers (bourgeois reformist governments) and when it adopts neoliberal policies, is in any case a “representative of the public,” representing “the interests, needs, and desires of the general public.” Capitalist states have been and are the initiators, planners, and providers of war expenses and the continuation of bloody and inhumane wars that they always wage under various titles. They wage all these wars in the name of the people, national interest, maintaining the security of society, etc., while their goal is to protect and expand the interests of the capitalists. All capitalist states, even in a war, consider the right of self-defence and the killing of the opposing masses to be the defence of their own interests. The establishment, organization of war industries, military research organizations, equipping and keeping large masses of people on alert for future massacres is carried out at exorbitant costs and at the expense of these same masses. The capital state is busy day and night accounting for social capital, organizing the program and setting the budget, the expenditure and income of all social capital. Fundamental investments in roads, airports, ports, urban development, water supply systems, energy systems and their management are aimed at reducing capital costs, but under the guise of planning for the welfare and comfort of the working masses, of course, at their expense. The vast and long parliamentary bureaucratic apparatus, the entire state bureaucracy, the police and the judiciary, and prisons, under the guise of protecting democracy, actually play a role in silencing every voice of protest and strike of workers. All these huge apparatuses have been set up to maintain and perpetuate capitalist relations of production, and you see nothing else but this. At the same time, the state plays a huge role in imposing the thoughts, beliefs, and culture of the ruling class on the working masses, thereby helping to perpetuate the system of wage slavery. In other words, promoting and disseminating what the Harvey’s, Pikettys, and their associates say is part of the duties of the capital state. Planning to confront capitalist crises, reducing their destructive impact on the process of adding value to labour and accumulating capital by shifting their burden onto the working masses during and after these crises, is another serious and important duty of the capital state apparatus. The state has always been the representative of the ruling class and the protector of its interests throughout its history. Even the “traditional form of state rule” that Harvey so highly values is nothing more than an organ of the ruling class’s power. One of the themes that He persistently pursues in various parts of this book, as well as in the book “The Enigma of Capital and the Crises of Capitalism,” is the roots of the capitalist crises in the 1970s, 1980s, and 1990s in the adoption of neoliberal policies by governments. He attributes the great crisis of the 1990s in Southeast Asia, Japan, parts of Europe (such as the currency crisis in Sweden, Italy, and the United Kingdom, which led to the collapse of these countries’ currencies and the terrible debt crisis in these three countries in particular), Mexico, Brazil, Argentina, and other Latin American countries to the adoption of neoliberal policies by the governments of these countries, and says, “Another view of that crisis was that hasty financial deregulation and the failure to establish adequate regulatory controls over speculative and uncontrollable investments were the main factors in its emergence. The evidence for this latter view is abundant.” Harvey, who himself belongs to this group, does not show this evidence anywhere. He only lists astronomical figures of quick profits resulting from financial transactions of banks, large international financial institutions and governments, stock market gambling and trading in stocks and overnight acquisition of billions of dollars through buying and selling currencies and the like, in order to hide from view all the inherent contradictions and radical rottenness of capitalism. It seems that the huge accumulations of capital have not resulted from the surplus values produced by the mass of workers in the world, but from transactions, cleverness and the precise implementation of neoliberal policies, and interestingly, these are also the factors that caused the crisis in these decades. In this analysis, he also shows his inability and helplessness in seeing the roots of capitalist crises in the mode of production and production relations of this system, and he sees the roots in market relations where the surplus values produced by workers are distributed between different sectors and areas of capital. For Harvey and his associates, capital is everything and the producers of capital, the billion-strong masses of workers in the world, are nothing. His culmination and main source in this regard becomes clear in his study of Swedish capitalism. When the Swedish version of social democracy is sanctified in the eternal burial of the labour movement of this country and its confinement in the class agreement rooms of the heads of labour unions and employers with the intervention and active role of the capital state. We have already mentioned the Renn-Meidner program in the crisis periods of the 70s, 80s and 90s in Europe and we have said how this plan came to the aid of capitalism in this country in such a way that it stopped the labour movement and its development of struggle and turned this country into a wasteland for the hounds of capital. For decades now, no worker has been heard of anywhere in this land. The Swedish workers, with the most advanced industries and labour productivity, with the longest working hours, the longest working life in the world of capital and under the strong and irresistible power of the terrible and sinister alliance of the heads of labour unions and employers, await the outcome of the meetings of the heads of this union every year or every few years, in order to completely passively witness their fate over a certain period. The result of this situation over time has been the complete and unconditional submission of the Swedish working class to all the conditions of capitalist production relations, to the point where they regard these relations as their eternal destiny. The evasive movements of this class are within the framework of the laws of this system and are limited to working conditions and a penny increase in wages. This is the culmination of the dreams and aspirations of Harvey’s social reformism and of all those who see the fate of the working class in the hands of the capitalist class and wage labour relations. On the other hand, what Harvey claims that “according to this plan (meaning the Renn-Meinders plan) 20% of the tax on corporate profits should be deposited in a fund of wage earners supervised by the unions to be reinvested in companies” is not true and is something he has concocted himself. The nonsense that Harvey pours out is what the Swedish social democracy whispers every day in its colourful newspapers. “The power of capital was probably no where in the Western world more democratically threatened than in Sweden in the 1970s. The balance of class forces in Sweden, where the Social Democrats had been in power since the 1930s, was established around a strong, centralized trade union structure that negotiated jointly and directly with the Swedish capitalist class over wage rates, benefits, contract terms, and the like. The Swedish welfare state was politically organized around the ideals of redistributive socialism with progressive taxation and the reduction of income inequality and poverty, achieved in part through the provision of extensive welfare services.”
Harvey is so enamored of Swedish social reformism that when he talks about the Swedish welfare state, water flows from his mouth and he doesn’t know where to start! In his world, which is the world of capital and capital’s destiny, socialism is a piece of bread thrown to the working class by the bourgeoisie, which apparently fills its stomach to some extent, but at the same time locks its fate forever in the interests of capital. The Swedish bourgeoisie and its industries not only did not suffer any damage during the Second Imperialist War, but under the “policy of neutrality” they benefited from both sides of the war. Sweden was the only country in Northern Europe that remained neutral in the war and made profitable deals with both fronts. In exchange for the Nazi gold, they owned coal, wood, high-quality steel, iron ore and all kinds of advanced technology, and the West, in addition to the Soviet Union, used Sweden’s entire communications system, advanced logistics and free and neutral market. This policy is still continuing because of its unique advantages, and the Swedish government is the only Nordic country that, despite all the use of NATO military power, has not yet joined this organization. The Swedish bourgeoisie, having flourished in the post-war period, enjoyed a superior position for the growth of capital and accumulation than other European countries, where industry, communications, financial centres, and even the central government had suffered heavy losses. The only factor that could stop the bourgeoisie from taking advantage of it at this time was the working class. At this time, Swedish Social Democracy came to the aid of capital in this country, and with the Rein-Meidner plan, a union of employers and union leaders was formed on the basis of a specific platform, the main axis of which was the growth of profitability and the increase in the competitiveness of Swedish industrial capital in the world of capital. The result of this work was an extremely advanced country in terms of industry and high labour productivity, which at any time when the world of capital was expanding beyond its borders, was to some extent an island of capital stability. This situation opened the hands of the Swedish bourgeoisie to buy a part of the Swedish workers and increased their power to control the workers, so that they were always ready to buy a part, however insignificant, of the proletariat of this country in order to silence the entire working class of this country. Now, since the mid-1990s, although most of these privileges have been taken away from workers, schools and the education system have regressed to the point of being worse off year after year, teachers’ low salaries do not cover the increasing costs, the number of hospital beds is decreasing along with medical budgets, nurses and health centre workers have long suffered from stagnant wages and increased workload, the social insurance system is in disarray, the pension system, which was unique in its kind until 1993, was sold at a bargain price on the capital market during the crisis of Swedish capitalism, so that from that time on, workers had to set aside a portion of their monthly wages so that they could live out their old age with the goosebumps paid by the pension fund when capital is no longer able to profit from their labour and they have no energy left. The general poverty of this large social group has become a common proverb, with the so-called “poor pensioners” being a common and common thing. Despite all these setbacks for the working class and the huge cost reductions that Swedish capitalism has made, the working class in this country still bears the highest per capita taxes in the world, has the longest working life, and has the longest official working hours in Europe. All this means that the bread that the capitalists and their government used to throw at the workers by obtaining countless guarantees and therefore carrying the title of welfare state has ended, and all that remains is the high pressure and acceleration of work, harder working conditions and stagnant wages, and worst of all, the lack of self-reliance and class strength of the workers themselves. The crisis of capitalism in Sweden in 1993, like in all capitalist countries, especially in Europe, had its effects in reducing the costs of capital at the expense of the greater misery of the working masses and in taking back all the privileges that the workers had gained in pushing back capital. The Swedish government debt reached an astronomical figure of 1,500 billion kronor, which was unprecedented in the history of the country. Every day, the colourful newspapers of the Swedish bourgeoisie announced the amount of debt owed by each Swedish worker to this huge government debt to save the capital institutions. The figure of 180,000 kronor flew over each worker. This speculation was not unrelated to reality. Within a short time, 2,000 construction companies went bankrupt, leading to the bankruptcy of 200 banks and financial institutions, so that the financial losses of the latter reached 200 billion kronor. These debts and bankruptcies caused the Swedish capital government to let the currency float on the market, which in turn led to a greater financial crisis, which in a short time reduced its value by 25% against the German mark and by 40% against the dollar. To compensate for the decline in profits, a 500% interest rate was imposed on the banks and the monetary system, the pension system was dismantled, and it was said that each worker would be responsible for organizing, saving, and planning his or her own retirement, a policy that still stands today. This was while in a short period of time unemployment rose from 100,000 workers to 450,000 (according to official figures, which do not include those forced into early retirement, temporary jobs of a few hours a week or even a month, and salaried employees who are in training and do not include students). All union leaders responded positively to the coalition government’s wage freeze policies. Much capital left the country, and the capital government began a process that had been going on since the end of the “welfare state” era, and which continued for a long time. In order to compensate for the budgets for basic investments, the capital government began organizing the sale of state-owned capitalist companies and institutions. This process did not involve the government putting them up for auction in a state of serious bankruptcy, but in most cases, they were reorganized and sold at market prices, and the proceeds provided adequate capital to save the entire social capital. From then on, the Swedish capitalist government, both the Social Democratic and other bourgeois governments, invested enormous amounts in cyber systems (the Internet, nationwide cabling, attempts to create IT centres like the US’s Cellcom Valley and basic research centres for medical technology), roads, airports, and so on. Investments that are infrastructural for the whole of social capital and contribute to reducing production costs, increasing labor productivity and increasing Sweden’s share of international surplus value. Harvey calls this the result of the Swedish elite and politicians’ “inability to think of any other solution than that prescribed by the neoliberal perspective.” He fails to understand that bourgeois politicians have no need for his sermons and that they are dictated by capital and its need for ever greater profitability. It is not consciousness that determines life, but life that determines consciousness (to quote Marx in The German Ideology). It is not Harvey or the politicians of the Swedish bourgeoisie who even determine their own history. If what they wanted, wished for or imagined about themselves had happened, capitalism would not have been in crisis. Harvey imagines that adopting neoliberal policy and implementing it is an end in itself, but individuals, politicians, bourgeois technocrats decide not as they see fit or as others see fit, but as capital needs them. What he fails to understand is the source and origin of bourgeois thoughts, policies, and decision-making. He speaks of the emergence of neoliberal policies as if a handful of bourgeois have set out to create these policies by referring to the world of their own dreams, beliefs, and personal tastes!!