this post was submitted on 12 Nov 2024
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Why force austerity on the periphery when production operates more efficiently without the inefficiency that private monopolies induce? (hexbear.net)
submitted 3 days ago by FunkyStuff@hexbear.net to c/marxism@hexbear.net
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I was watching this interview with Michael Hudson and Richard Wolff, and Hudson said something that I completely accepted at first, but mulling it over now it seems contradictory. He says that the IMF and World Bank, as neo-colonial powers, arrest the development of capitalism within the colonized countries, by enforcing austerity and making them privatize everything. He says that the purpose of doing this is to prevent the saturation that happens naturally as local finance capital develops and begins to deindustrialize the economy, which grinds industrial development to a halt as finance capitalists only exist as leeches that make their money by creating rents.

Now, where I take issue with this analysis, is that a great deal of what the IMF and World Bank do is steer countries into privatizing public healthcare, education, and other natural monopolies. When these services are public, they don't hold industry back from booming because they take care of a significant social cost, so if the state takes care of them the state is subsidizing industry to keep developing. Yet when they're private, they hold a monopoly position and exploit it to charge rent on everyone else because of the obvious necessity for these services. This keeps industry from developing.

If imperialists need the industrial capacity of the periphery, why kneecap it with privatization?

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[–] FunkyStuff@hexbear.net 1 points 3 days ago (3 children)
  1. But this explicitly just leads to less profit for the multinationals. The private healthcare insurers, utilities, etc that can profit off the privatization are generally local companies that belong to the national bourgeoisies of the colonized countries.
  2. Monopoly capitalism is definitionally the most centralized capital has ever been. The IMF and World Bank are single, centralized institutions that (from my perspective right now) are making an unforced error.
  3. True
  4. The safety net in question still results in more productive labor as a whole, though? This point is just a rejection of materialism. Private monopolies increase socially necessary labor, it's additional economic rent and it just holds back productivity. How is a materialist to dismiss that fact just because the safety net makes people lose hope?
  5. and 6 see point 4
[–] KobaCumTribute@hexbear.net 13 points 3 days ago

The IMF and World Bank are single, centralized institutions that (from my perspective right now) are making an unforced error.

As much as neoliberals can be cynical, calculated, and cruel, it's easy to forget that their economic system is a dogmatic cult that's irrational, flawed, and built on materially false tenets. They're not magic robots doing paperclip optimization, they're cruel people dogmatically following an earnest belief in a deeply flawed school of economic thought written by cranks with ulterior motives.

[–] Collatz_problem@hexbear.net 9 points 3 days ago
  1. Social services improve workers' position on labour market, leading to higher wages, so it is profitable for capitalists to destroy them.
[–] JoeByeThen@hexbear.net 8 points 3 days ago (1 children)

I mean, not all capitalists are marxists, my dude.🤷 Austerity has been proven to be bunk; They're still doing it. While a bunch of those ghouls (Clinton, Obama, that one general guy spring to mind) are familiar with Marxist theory, plenty of them are not and are doing what they think will increase profits purely based on vibes. Someone in another post recently mentioned 48 Laws of Power, it is a book of sociopathic behaviour, based on vibes that many rich people use as a Bible. All your points (which I totally agree with) could easily be turned back on the global north. I mean, don't we regularly joke around here that Marxists would do capitalism better except we give a shit about people?

[–] FunkyStuff@hexbear.net 4 points 3 days ago

Yeah, I suppose you're right. In the same interview I linked Hudson throws his hands up and exclaims basically the same thing, his job as an economist is impossible because the ruling class has blinded itself about its own interests and has now repeatedly failed to act in its own basic material interest. But it just seems like a critical failure of materialism as an analytic framework that you have to just accept that these people care more about ideas than facts.