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The populist moment


© Volker Straeter

Populism sure is getting bad reviews. All manner of evil is getting laid at its door: racism, xenophobia, authoritarianism, jingoism – and that’s just the start. The conventional view is that populism is an irrational and impatient response to modern dilemmas that are best solved by conventional politics and economics. There is much evidence linking current politicians and political campaigns deemed populist – Trump, much of the Brexit campaign, Orbán in Hungary, the far-Right parties across Europe – to simple-minded scapegoating as a way to achieve or stay in power. But throwing the term populism around so loosely is just a bit too easy and analytically lazy.

For a start – who is a populist? Looking over the span of decades since decolonization (the 1950s and 1960s) a plethora of leaders and their movements have earned the label. These include Julius Nyerere of Tanzania, Kwame Nkrumah of Ghana and Thomas Sankara of Burkina Faso. Here we have some of Africa’s most revered and effective leaders. Sankara (who did not have much time before his assassination) and the others earned their populist labels by their effort to forge a deeper, more self-reliant decolonization than so many African leaders were willing to settle for. Today, Ghana and Tanzania are two of the more coherently democratic societies in post-colonial Africa.

Pile of populists

More recently, in Latin America a wave of leftwing governments (referred to as Bolivarian) were swept into power by poor voters tired of brutal military rule that enriched the continent’s oligarchs and transnational corporations to the cost of everyone else. In country after country these ‘populists’ pursued egalitarian goals and significantly reduced both extreme poverty and inequality. Much (but not all) of this movement is now in retreat, suffering problems of bureaucratism and corruption that also plagued its more conventional predecessors.

Left populism’s recent difficulties have led to much crowing on the part of the privileged in capital cities of Latin America as well as in Washington, London or Ottawa. That harbinger of establishment anti-populism The Economist expressed delight that at least some of Latin America’s ‘spendthrift’ populists are fading from the scene. There is also a simple-minded tendency to lump all populists together: Cristina Fernández de Kirchner of Argentina (where there is a long history of both Left and Right populism) with the indigenous radicalism that propelled the still-popular Evo Morales and his MAS party to power in Bolivia.

Drawing the ‘unwashed’ into politics is perceived as a threat by anti-populists, who prefer to preside over a mass of passive consumers and resentful taxpayers

Populist credentials often seem to hang on personal political style. It is much easier for a fiery balcony orator like Hugo Chávez (a lightning rod of the anti-populists) to carry the label than Uruguay’s José ‘Pepe’ Mujica (a former Tupamaro guerrilla) famous for his integrity and modest personal lifestyle. Yet both get dumped in the populist pile.

Also lost on the anti-populists is the absurdity of placing Silvio Berlusconi (the very model for Donald Trump?) in the same bag as Beppe Grillo of Italy’s popular Five Star protest movement that, whatever its faults, is opposed to almost everything Berlusconi represents. Their definition of populism is wedded to a loose notion of appealing to the people outside the conventions and structures of politics-as-usual. Drawing the ‘unwashed’ into politics is perceived as a threat by anti-populists, who prefer to preside over a mass of passive consumers and resentful taxpayers. But what gets missed in this blanket assault is that populism comes from all parts of the political spectrum, with widely varying philosophies, levels of integrity and preoccupations. Perhaps surprisingly, the simplest and clearest definition of populism comes from a lapsed aristocratic neoconservative, the Japanese-American political philosopher Francis Fukuyama. According to him, populism is ‘the label that political elites attach to policies supported by local citizens that they don’t like’.

Trapped in the centre

Maybe it’s easier to define what isn’t populism than what is. The ‘neoliberal consensus’ that spreads from the centre-Left to the centre-Right and champions the discipline of the global market as the best way of organizing human affairs is definitely not populist. The shrinking difference between Left and Right in contemporary politics is based on the notion that ‘there is no alternative’ to a system in which most people feel they have little or no control. A professional political class has usurped any notion that democracy is about the broad self-governance of the citizenry.

Fortunately people are stubborn in clinging to the notion that we don’t live in the best of all possible worlds and that things could and should be different

Bill Clinton’s infamous campaign slogan ‘It’s the economy, stupid’ captures the flavour of it all. The economy and those who control it set the limits of democratic choice. In daily life, debt and poverty box in far too many. Bureaucratic states in combination with the corporate economy are set on an auto-pilot course of carbon-based growth, economic insecurity, inequality and ecological destruction. It is the champions of this system that so easily throw around the P-word to express a coded disdain for ordinary people and their political capacities. Their technocratic arrogance has provoked the current ‘populist moment’, most recently bringing us Donald Trump but also Bernie Sanders.

Fortunately, people are stubborn in clinging to the notion that we don’t live in the best of all possible worlds and that things could and should be different. That some of these hopes turn in illusory and misguided directions and can be captured by monsters for their own dubious purposes is undeniable. How could it be otherwise in a system poisoned by the Hobbesian ethic of the ‘war of all against all’ – where the insecure are too easily manipulated to look down for scapegoats rather than up at the glamorous wealthy for causes of their grief? At their best, Left variants of populism draw a line between the besieged majority and ‘Old Corruption’ as the British radical pamphleteer William Cobbett used to describe it back in the day. For The People’s Party in 19th-century western US states like Kansas and Idaho, the main culprits were the banks, railroads and the gold standard. Today, Occupy calls it the one per cent, and Spain’s anti-austerity Podemos refers to it as la Casta (a scandal-ridden political class) – but it’s still Old Corruption in designer clothes. Populists are often accused of the crime of trading in the blame of ‘Others’, but it is one thing to be critical of corrupt political elites and big banks, and quite another to scapegoat vulnerable minorities: whether immigrants, refugees, Roma or Jews. The undoubted shortcomings of Left populism need to be leavened by a cosmopolitan tolerance and internationalism if it is to effectively undercut the jingoism of the Right.

While the intelligentsia will always be suspicious of populism of whatever stripe, these days, without Left populist parties and movements, the political polarization is between racist and xenophobic movements of the populist Right and the sterile consensus politics of the Centre Right and Centre Left. It is becoming apparent that this Centre simply cannot hold. The notion that we as a species are in profound crisis is rapidly spreading. The problems we face of wrenching inequality and the carbon countdown to climate degradation do not lend themselves to a little technocratic tinkering. The basic structures of capitalist society need a thorough rethink that must involve a broadening of democracy. A rough-and-ready and even impolite populism of the Left, unafraid of accusation and confrontation, could be an important agent in building such a sustainable future.

Richard Swift is a former co-editor of New Internationalist and author of SOS Alternatives to Capitalism.

The Transition Movements meets De-Growth

Co-Founder of the Transition Movement, Naresh Giangrande in conversation with Richard Swift, author of SOS Alternatives to Capitalism and a former editor of New Internationalist magazine for more than two decades. These two thinkers were brought together in the Caribbean island of Dominica, with Earthbooktv's Jessica Canham and Timothy Speaks Fishleigh at the Earthbook retreat centre in the mountains of Dominica.

Tax cheating, easy living


Floating on top of the world – a well-heeled client enjoys himself in the infinity pool of the luxurious Marina Bay Sands hotel overlooking Singapore’s financial district (where discretion is guaranteed). © Paolo Woods & Gabriele Galimberti/INSTITUTE

Should I declare it? It’s a question many of us ask as tax time rolls around. Aside from the fear of getting caught, why do we actually pay taxes? After all, anyone’s individual taxes don’t amount to very much in the overall scheme of things. Who would miss them? And then there are all those irritating things governments waste our taxes on – corporate subsidies, expensive military hardware, big salaries for high-handed bureaucrats.

But in the end our taxes are also part of the social bond that ties us together as a society: giving us basic services we all need, supporting the most vulnerable of us and restraining the predatory tendencies to which capitalism seems preternaturally inclined. If we look at it this way, taxes are the gift we give each other. When we lose faith in that simple truth, we move a little bit closer to the abyss of the ‘war of all against all’.

This year has been a bad one for tax cheats. The New York Times’ October disclosure that Donald Trump likely used a variety of accounting tricks to avoid paying nearly a billion dollars in federal taxes was only one in a string of shocking revelations that shed new light on the unfair tax practices of transnationals and the ultra-rich. From Apple Ireland’s spat with the European Union to the Panama Papers and Bahamas Leaks, this year has seen tax dodgers in the limelight as never before. And with public pressure mounting, even the political class has taken notice, with David Cameron – himself the not-so-proud beneficiary of an offshore trust – vowing last May to ‘push… corruption to the top of the international agenda’.1 Given the heat, it’s easy to imagine tax cheats sweating in their designer suits.

Or maybe not. After all, this is hardly the first time tax dodging has gone under the microscope. In the wake of the 2008 financial crisis, G20 leaders came together to proclaim ‘the end of financial secrecy’. As far back as 1961, John F Kennedy was asking US Congress for legislation to drive tax havens ‘out of existence’.2 Yet since the 1960s, the amount of wealth held in tax havens and secrecy jurisdictions – the term experts use to refer to the 70-odd offshore financial centres whose low tax rates and loose regulations draw tax cheats the world over – has increased astronomically. Since 2008 alone, private wealth parked in tax havens increased by a staggering 25 per cent.3 While exact figures are hard to come by, French economist Gabriel Zucman estimates – conservatively – that $7.6 trillion is currently held offshore, eight per cent of total global financial wealth.3 James Henry, senior advisor at the Tax Justice Network, puts that number much higher, at anywhere from $21 to $32 trillion.4

While economists continue to quibble about the exact figures, all agree that the offshore economy is massive. More than half of all banking assets are routed offshore, as is about half of global trade. Like it or not – and most of us have many reasons not to like it – the offshore world isn’t going anywhere.

The life offshore

What is ‘offshore’? The word conjures images of swaying palm trees, expensive cigars and lax tax laws – sleepy islands where corrupt plutocrats and cunning mobsters quietly squirrel away their ill-begotten millions. And while this is certainly part of the offshore equation, it only scratches the surface. In essence, offshore is anywhere that allows its clients – a mix of criminals, corporations and the very rich – to get around the pesky taxes and regulations imposed by other jurisdictions. While Caribbean tax havens still play an important role, some of the biggest players in the offshore world are not islands at all. The City of London sits at the heart of a colonial network of secrecy jurisdictions and offshore financial centres comprised of its crown dependencies and overseas territories. American banks offer tax-free accounts and secrecy services to illicit foreign capital, making the US one of the biggest players in the offshore economy. Many of offshore’s biggest clients are establishment figures like Iceland’s former prime minister Sigmundur Gunnlaugsson and familiar brands like Pepsi, Google and Facebook.

Campaigners help force consumer-sensitive Starbucks to pay $9.7 million in UK taxes – which corporate avoiders are next in the crosshairs?

Jenny Matthews/Alamy Stock Photo

Today the offshore world comprises an economic system, a complex web of tax havens and secrecy jurisdictions that is simultaneously separate from and integral to the functioning of the global economy. Each cog within this system has its own special function: from offices in London or New York, the wealthy use arcane accounting arrangements to squirrel away billions in Cayman-domiciled hedge funds, where the money multiplies tax free. Transnationals use complex ‘transfer pricing’ arrangements to shift billions in profit from the large, high-tax nations where they do business to single-employee letterbox subsidiaries in havens like Jersey, Bermuda and Luxembourg. Investment banks and other financial desperadoes take advantage of the low taxes and loose regulation offered offshore to engage in the kind of financial chicanery that destroyed Enron and led to the 2008 credit crunch.

Today, the offshore world has become an essential part of the bloated international financial sector that lies like deadweight on the possibility of a fair economy based on a simple first principle: meeting the basic needs of ordinary people. The system can seem complicated, and that’s the point; tax cheats rely on soporific tax law and fragmented international regulation to shield their money from tax authorities.

An example: a British entrepreneur plans to leave millions to her children, and wants to avoid hefty inheritance tax. She might set up a Bahamian trust to administer the money, which it in turn deposits in an account in the tax-free Caymans. The trust’s directors might be ‘dummy nominees’ – professionals paid to manage hundreds of similar companies. Its beneficiary might turn out to be an anonymous Delaware corporation whose director, a Panamanian lawyer, is bound by attorney-client privilege to conceal the company’s ultimate beneficiaries: in this case, the woman’s now wealthy children.

If the British tax authorities want to look into the money, they will have their work cut out for them. By exploiting strict secrecy laws in tax havens and taking advantage of the arcane tangle of legislation that exists across multiple jurisdictions, cheats are able to dodge tax almost completely, often while staying within the letter of the law.

A story: the Cayman Islands is what’s known as a ‘pure’ tax haven. It imposes no direct tax, meaning that there is zero tax on corporate profits, income, inheritance, or capital gains. As such, it has become a magnet for mobile capital looking to escape the hands of ‘revenuers’. Today, the Caymans are the world’s sixth-biggest banking centre, home to 40 per cent of the world’s hedge funds and thousands of transnational subsidiaries controlling some $1.4 trillion in liabilities.5

More than half of all banking assets are routed offshore, as is about half of global trade

In 2004, the Caymans were hit by Hurricane Ivan, a category-five storm that caused major damage, cutting power and destroying infrastructure across the islands. When the storm cleared, several people were dead and more than a quarter of the islands’ dwellings had been left uninhabitable. This should have had the global financial elite panicking. But markets barely registered Ivan. McKeeva Bush, then leader of Cayman government business, reported that the islands’ financial services industry ‘offered continuity of service throughout the hurricane,’ cheerfully noting that ‘as a consequence of the multi-jurisdictional nature of many Cayman Islands firms, financial service provision continued at a high level.’6

This story underscores an essential point about the offshore world. While the Caymans may be home to 100,000 registered companies, very little substantive economic activity takes place there. Apart from the legion of parasitic lawyers and accountants who have set up shop to facilitate tax dodging, almost all the money in the Caymans – whose citizens derive little benefit from the islands’ outsized financial industry – passes through only on paper on its way to Wall Street or the City of London.

What capital values about the Cayman Islands is not any special technical or productive capacity, but rather its sovereignty; the islands, like most offshore destinations, are a ‘legislative elsewhere’: a financial wild west where the wealthy shape lawmaking and escape cumbersome taxes and regulations.

What’s wrong with tax avoidance?

Tax cheats are careful to stress the difference between evasion and avoidance. While evasion is illegal, avoidance – using complicated accounting tricks and complex multijurisdictional structures to slash tax bills – is not only legal, but imperative. Indeed, many corporate tax avoiders speak proudly of ‘tax neutralization’ strategies, arguing that they owe a ‘fiduciary responsibility’ to shareholders to pay as little tax as possible.

This thinking rests on a neoliberal reformulation of taxation. Most of us still see tax as the price we pay for the social infrastructure – roads, schools, healthcare – that makes democratic life possible. But as a neoliberal ethos of austerity and self-interest comes to dominate our politics, any sense of our social obligations to each other goes out the window. If we are just a conglomerate of isolated individuals, if fortunes really are ‘self-made’ rather than resting on myriad unquantifiable social investments, then tax can only ever be experienced as a ‘burden’. This is why Donald Trump can project himself as the neoliberal hero par excellence, ‘brilliantly [using]’ tax laws to avoid federal taxes.

In this climate of unmitigated greed, tax havens are thriving like never before. Economists estimate that governments lose about $400 billion in tax revenue each year to the offshore economy, more than twice the annual global aid budget.3 This flow of wealth offshore has a corrosive effect on democracy, fuelling inequality and austerity and pushing the burden of taxation onto small local businesses and middle- and working-class taxpayers who cannot afford teams of accountants and lawyers.

Politicians who receive kickbacks and campaign contributions from tax abusers continue to drag their feet

As taxation becomes an optional matter for those with means, those without begin to wonder why they have been left to foot the bill. In countries like Greece and Italy, and large parts of the Global South, a contagion of tax avoidance is spreading throughout the economy, undermining all revenue collection and drying up the fragile glue that holds society together.

The offshore system also drives harmful tax competition, pushing down tax rates worldwide. In a globalized economy, where capital is free to choose where to set up shop, national economies must compete with each other in order to attract and keep jobs and investment. If transnationals don’t like a particular tax or regulatory regime, the threat of relocation is often enough to get policymakers to see things their way. If not, there is always somewhere else eager to offer lower tax and other sweeteners. Whether it is Belgium’s fiscal incentive scheme aiding McDonald’s and some 35 other corporate freeloaders, or sweetheart tax deals offered to the mining industry from East Africa to the Nevada desert, politicians of all stripes live in fear of the ‘jobs hissy fit’ that corporate CEOs are so good at throwing if they don’t get their way. Tax competition further undermines democracy globally, wrestling control of tax policy from elected governments and forcing countries into a Hobbesian race to the bottom. Some experts believe that in 10 years, corporate taxation will be a thing of the past.

The offshore system has had a particularly devastating impact in the Global South, where a combination of rampant corruption and decrepit tax administrations has amplified its impact. It’s estimated that between 2004 and 2013, more than $7.8 trillion flowed illicitly from developing economies to offshore accounts; many such economies lose more to tax havens than they receive in aid and foreign investment combined.7 In sub-Saharan Africa, the problem is so bad that experts estimate the continent has lost 80 cents for every dollar of external debt accrued since 1975.8 While Western politicians are quick to point a finger at supposedly endemic ‘third world’ corruption, little attention is paid to the role of tax havens, including both the US and the City of London, in actively abetting the illegal transfer of wealth from developing economies.

When will it end?

Little is being done to curb tax avoidance and rein in the offshore system. While it’s true that, after years of half-hearted and ineffective legislation, pressure from civil society is finally forcing governments to take tax cheats seriously, the response is still surprisingly lacklustre. Yet the technical problems are not insurmountable, and economists have offered ambitious but doable proposals on how to begin tackling tax dodgers. Britain could, with the swoop of a pen, reform the vast network of crown dependencies and overseas territories over which it has ultimate political control – it exercised this power in 2000 to decriminalize homosexuality in its Caribbean territories.9

The problem is political will. The offshore system continues to survive and thrive because there are powerful interests – one-per-centers and transnational corporations – who want it that way. Lawmakers seeking to reform the system are continually met with fierce resistance from powerful lobby groups like the Coalition for Tax Competition. Politicians who receive kickbacks and campaign contributions from tax abusers continue to drag their feet. Many politicians are themselves enthusiastic participants in the offshore economy: the Panama Papers revelations have compromised political luminaries such as Ukrainian President Petro Poroshenko, the King of Saudi Arabia, and close relatives of Syrian Dictator Bashar al-Assad. In this climate of rampant greed and corruption, the impetus falls on regular citizens to hold tax cheats to account. No-one else will do it for us.

  1. The Independent nin.tl/anti-corruption-2016
  2. Nicholas Shaxson, Treasure Islands, Vintage books, London, 2012.
  3. Gabriel Zucman, The Hidden Wealth of Nations, University of Chicago Press, 2015.
  4. James Henry, The Price of Offshore Revisited, Tax Justice Network, July 2012.
  5. Financial Secrecy Index nin.tl/cayman-offshoring
  6. UK Parliament nin.tl/ivan-cayman
  7. Global Financial Integrity nin.tl/illicit-flows
  8. Elcano Royal Institute nin.tl/Africa-capital-flight
  9. Pink News nin.tl/gay-rights-cayman

HotDocs Festival - Film review special

Still from Norman Lear film

Norman Lear: Just Another Version of You

directed by Rachel Grady and Heidi Ewing. (91 minutes)

This is a polished documentary biopic of one of the great innovators of mainstream US television. Lear is now a dynamic 92-year-old, still full of energy and ideas. The film strings together some fabulous music with often amusing footage from Lear’s youth (he grew up in a poor and broken Jewish New York family) to later public appearances on talk shows. Throughout, Lear is the very model of wit and grace.

Back in the day, which for Lear was from the late 1960s into the 1980s, he worked 75-hour-weeks to create and write sit-coms such as All in the Family, Maude, The Jeffersons – bringing issues like racism, reproductive rights, national chauvinism, violence, sexual orientation and drug addiction centre-stage on US network TV. For the fundamentalist Right he was the anti-Christ and they vilified him wherever and whenever they could. He finally quit Hollywood and set up People for the American Way to defend cultural space against their incursions.

Rating: ★★★★

Hooligan Sparrow

directed by Nanfu Wang. (85 minutes)

Ye Haiyen (‘Hooligan Sparrow’) is a Chinese sex-rights activist who, with great humour and resilience, challenges her country’s hypocrisy, puritanism and exploitative practices. The film opens on the tourist resort island where the irrepressible Ye previously antagonized brothel owners by, as part of her campaign for sex workers’ rights, offering free sex to migrant workers. Now she is on the trail of a local school principal who has been taking 11-year-olds to a resort hotel for sex. (Ye claims it is a widespread practice in China for principals to offer young students to local party officials as bribes.) The publicity forces reluctant police to arrest the teacher and as he is hauled off, Ye, surrounded by fellow activists, sports a sign saying: ‘Hey, principal, get a room with me and leave the kids alone.’

The authorities are not amused. Soon Ye, accompanied by young filmmaker Wang, are fleeing police and assorted pro-government goons. Ye is impressive and so is Wang, who braves smashed cameras to smuggle her footage out of China. Her first film, not the most polished of pieces, is a raw effort to expose injustice under perilous circumstances.

Rating: ★★★

Fireflies in the Abyss

directed by Chandrasekhar Reddy. (88 minutes)

Eleven-year-old Suraj and his friends and family can barely survive as rat-hole miners, scraping coal from rock in a dangerous pit mine in northeast India. Filmmaker Reddy took months winning the trust of these Nepalese migrants by living with them and sharing the risks of going down into the unstable coal pits, his camera perched on a rickety trolley. It makes for a slow and thoughtful documentary.

This is much more than a standard exposé of child labour and appalling working conditions. Reddy captures the rhythms of life in a marginal mining community, and in the laughter and tears of the Nepalese workers themselves. We are immersed in their intersecting personal stories that give a sense of individual hopes and fears against the backdrop of often bleak, at times beautiful, countryside. The kids here grow up too fast, with a stubborn smile and a determination to survive.

Rating: ★★★

A Revolution in Four Seasons

directed by Jesse Deeter. (90 minutes)

The Arab Spring’s one fragile success story is Tunisia and this film seeks to explore its dynamics through the stories of two women. Both sympathize with the aspirations for freedom, but in radically different ways. One is freelance journalist and blogger Emna Ben Jemaa who craves a secular freedom that fits her cosmopolitan roots in urban Tunis. The other is Jawhara Ettis, a star of the youth movement of the Islamist Ennahda Party, who sees her country’s future in tolerant but decidedly religious terms. She is elected to the Tunisian Parliament after the overthrow of the country’s corrupt leader, Ben Ali.

Deeter resists arranging for the two activists to meet. Instead, she draws from their parallel stories and reactions to the vicissitudes of a revolution in which they invest much hope. Both women marry and have their first child against the backdrop of demonstrations, assassinations and political intrigue. It’s not an easy ride. Tunisia has been scarred by fundamentalist terrorism that threatens to derail the precarious consensus, presenting a cruel challenge to both the women’s perspectives. This is political documentary-making at its best, delivering gripping human drama that provides understanding without sacrificing complexity.

Rating: ★★★★

Do Not Resist

directed by Craig Atkinson. (70 minutes)

From Ferguson Missouri to small-town USA, this is a harrowing exposé of the militariza­tion of police tactics and technologies. We see a system of profiling and surveillance way beyond the imaginings of the most paranoid activist. We meet the ideologues of this dystopian police state: training cheerleaders who preach the gospel of ‘us’ versus ‘them’ to uniformed superheroes, ‘criminologists’ who champion drones killing without human orders, and the pre-crime profiling of ‘killers’ (mostly people of colour) not yet born.

Modern US policing is organized around highly militarized SWAT squads driving to the homes of potential ‘perps’ at unexpected hours and smashing up their houses and belongings. The tactics and technologies have been road-tested in the occupations of Iraq and Afghanistan. Director Craig Atkinson captures the gung-ho enthusiasm of these frat boy cops with very few discordant or critical voices to puncture the night­mare. It makes for an important document that we ignore at our peril.

Rating: ★★★★

Chasing Asylum

directed by Eva Orner. (96 minutes)

Clandestine footage from the Australian refugee gulags on Pacific islands provides an unflinching examination of one of the most draconian anti-migration systems in the world. The Australian political class has constructed this system of camps to send out the message that no illegal migrant will ever be welcome on the shores of the sub-continent. Refugees (mostly from Asia) are left to rot in stifling prisons where lives of regimented boredom are leading to an epidemic of despair and self-harm.

Orner’s footage is striking in that you rarely see the face of camp staff. This is due to fear of the government’s repressive legislation that could mean job loss, hefty fines, even prison for whistleblowers. This contributes to the film’s claustrophobic feel, deriving both from prison bars and the camera playing on the wrists or shoulders of anonymous interviewees. The effects of this refugee policy are intercut with clips of the political elite mobilizing fear and xenophobia to justify the unjustifiable. Orner puts Australia’s shame on display for all to judge.

Rating: ★★★

Introducing... Freddy Lim

Richard Swift

The Campaign Office of Freddy Lim

Talk about unlikely… Who would have imagined that a tattooed heavy-metal musician would break the stale stand-off in Taiwanese politics between the KMT, which pushes for reunification with China, and the Democratic Progressive Party (DPP), which is neither democratic nor progressive.

But in elections on 16 January, Lim and his New Power Party broke through, with six seats. The old Kuomintang-based KMT was routed in both legislative and executive elections; the new president is Tsai Ing-wen of the DPP, the first woman ever to hold the post.

New Power is trying to channel the voice of a younger generation of activists who most recently came to prominence in the Sunflower Movement, which challenged the highly unpopular KMT President Ma Ying-jeou’s unscrupulous manoeuvrings to move the country further into China’s autocratic orbit.

Lim made his name as lead vocalist with popular band Chthonic. Now 39, he has come a long way from his pro-unification student days to become a staunch defender of Taiwanese identity against the predations of an elitist mainland that suppressed the language and culture of his grandparents.

His move from heavy metal to politics came naturally. He explains that in contemporary Taiwan ‘politicians are the most distrusted profession’, while no-one distrusts musicians. So he tidied his wild black hair into a neat bun, hit the campaign trail and won a tightly fought race in the capital, Taipei. He hopes to eliminate the KMT, which he regards as an ‘undemocratic, pre-modern party’ that has dominated Taiwanese life for far too long.

Eco-divide: this changes everything


by Volker Straeter

The environmental crisis is proving not only a challenge to capitalism but forcing resistance movements to rethink their politics.

The title of this piece comes from Naomi Klein’s excellent book on climate change. There Klein makes the case for a sharp turn away from the looming doomsday that predatory capitalism wilfully refuses to see. But some of the historic alternatives to capitalism have also been blind to this. Before the 1960s, among the notions that the Left shared with capitalism were the centrality (indeed, absolute necessity) of economic growth, a concept of progress dependent on the exploitation of the natural world, and an almost unqualified belief in the beneficial nature of science and technology. The gospel of progress, born in the Enlightenment, held that the future of humanity must depend on ‘the conquest of nature’ to provide the good life. Division came over how this was to be brought about – through the state or through the market, by the bourgeoisie or by the proletariat, and so on.

With the gradual birth of ecological consciousness – landmarked by the publication of Rachel Carson’s 1962 classic Silent Spring on the effects of agrochemicals and the 1970s debate over limits to growth – a profound unease about the assumptions underpinning our productivist society has been gathering momentum.1 Is the widespread use of chemicals in industry and agriculture poisoning our own habitat and that of other species? Is our dependence on non-renewable resources and their rapid depletion putting us in a position of running on empty? Are we turning what should be renewable resources (soil, fish, water, forests – even air) into rapidly depleting non-renewable resources by ‘mining’ them with heavy technologies (building mega-dams and draining aquifers; using trawler fleets and driftnets; allowing agro-chemical runoff, soil compaction and desertification; clear-cutting forests)? Is our dependence on carbon endangering those who live in coastal areas, river valleys, or other habitats vulnerable to extreme weather and other consequences of a global temperature rise?

These questions loom increasingly large, casting a shadow over not only capitalism but any orthodox alternative to it. The dismal communist record on the environment can been seen in the dried-up Aral Sea between Kazakhstan and Uzbekistan, the radioactive protection zone still surrounding the Chernobyl nuclear reactor in Ukraine, and the looming water and energy crisis in China. Under communism, the triumphalist Stalinist mega-project – redirecting rivers, huge hydroelectric dams, soulless high-rise apartment blocks – were the sine qua non of progress.

The collapse of the Soviet bloc actually slowed global climate degradation, at least temporarily, as dysfunctional polluting industries went to the wall. Today, only Cuba, with its emphasis on alternative energy and organic agriculture, stands as a partial alternative to sacrificing the environment on the altar of economic development – and even there it is not clear if ecological initiatives are being carried out through conviction or due to necessities imposed by a Soviet collapse and a US embargo. Only time will tell.

Elsewhere, as with the late Hugo Chávez crafting a form of petro-socialism in Venezuela, short-term advantage seems to be trumping long-term ecological sanity. The history of the post-colonial Global South is marked by nationalist governments, often describing themselves as socialist, that champion development no matter what the ecological costs.

Greening of the Left

An ecologically coherent Left must come to terms with its own productivist roots if it is going to mount a convincing critique of capitalism. The Left must recreate itself by reorganizing around a programme of eco-sanity and challenging a process of growth that is not only moving too fast but also in a clearly unsustainable direction. It is by now pretty obvious that both inequality and growth are built into the very DNA of the capitalist system.

Capitalism can never be about selling us less, living in a more modest way, or reducing inequalities so as to allow us to share within our own societies – let alone the planet as a whole – in a sustainable fashion. The ‘me first’ ethics that underpin consumer culture are in sharp contradiction to the mutuality needed if we are to find a collective way to live more lightly on the earth.

A more basic challenge to the social and ecological wreckage capitalism is piling up is essential. Just a few basic facts are sufficient to show that the current desperate search for new sources of growth is heading us towards oblivion. First, growth rates across the industrial world have been declining for decades. There are no signs of a reversal of this trend – just the opposite. So it makes good sense to seek a different measure for our economic wellbeing aside from growth. Second, the negative impacts of the growth fetish, both ecological and social, are accumulating to a frightening extent. We would need five or six planet Earths if the whole world consumed and polluted at the same rate as US citizens (about three planets by European rates).

It is by now pretty obvious that both inequality and growth are built into the very DNA of the capitalist system

You could explore a range of other issues – such as soil and fresh-water degradation – and arrive at similarly alarming conclusions. Of course, it is true that the ecological footprint is badly skewed in favour of the wealthy. It would take a number of fair-sized African villages to have the same ecological impact as one upper-middle-class multi-vehicle-owning family commuting into New York or London from the affluent suburbs.

Inequality is the other major consequence of skewed capitalist growth. The Occupy movement, protesting against the one per cent and its lightly taxed paper wealth, is just the latest symptom of disenchantment with such obscene disparities. It is here that red and green preoccupations can rub up against one another in an uncomfortable fashion.

For those of an ecosocialist persuasion, it is essential that the costs of slowing growth are borne in an equitable manner. This means that the basic needs of all populations must be taken into account and the reductions associated with diminished growth possibilities, whether planned or unplanned, be applied first and foremost to those with an opulent lifestyle. It is easier to imagine this happening if degrowth takes place in a thought-out fashion rather than through an unplanned application of ‘lifeboat ethics’ that allows the powerful to protect their privileges while the vulnerable go to the wall. But have no doubt – degrowth there will be! It is just a question of whether this will result in equitable and democratic social arrangements or in gate-guarded communities serviced by underpaid workers and surrounded by large populations of environmental refugees.

A post-growth future

Any alternative to capitalism needs a post-growth future. There are by now many strains of Left ecological thinking trying to hammer out just what this might look like. There are the beginnings of a degrowth movement: this started in France and Spain and is now spreading to North America. There is a social ecology movement inspired by the writings of Murray Bookchin. There have been several attempts to fuse the socialist tradition with environmental concerns. Political theorists James O’Connor and John Bellamy Foster have explored such a synthesis in their writings. These are being underpinned intellectually by the burgeoning field of ecological economics, led by such notables as Herman Daly and Joan Martinez-Alier, as well as by a mounting body of climate and other environmental science that continues to reveal the deadly trajectory of the current growth obsession.

From the Global South comes an indigenous perspective based on the defence of Terra Madre, a competing tendency within the Latin American Left. Elsewhere, movements of resistance in Africa and Asia are working to defend the survival economy on which the rural poor depend by standing against deforestation, in defence of watersheds and in defiance of mega-projects designed to fuel various ‘economic miracles’ built on sand. The notion of a different, more equitable, development strategy has long been a counterfoil to the globalizers’ obsession with GDP growth. It has by now reached the point that any alternative to capitalism which does not accord the ecological survival of humanity a central place simply cannot be taken seriously.

Front cover, SOS Alternatives to Capitalism

This article, and the July/August issue main theme ‘Capitalism is spinning out of control’ is based on Richard Swift’s book SOS: Alternatives to Capitalism, which is available to buy through the New Internationalist webshop.

  • Rachel Carson, The Silent Spring, Houghton and Mifflin, New York, 1962.

  • The people’s flag is deep and red


    © by Volker Straeter

    Socialism organized through the state has been the main way in which humanity has tried to build an alternative to capitalism. We now have a couple of centuries of experience of this so it should be possible to draw up a balance sheet of positives and negatives. From the beginning, the state – or, if not the actually existing state, some idealized version of its socialist reformation – has been for most socialists a source of coherence and justice in opposition to the squalour and instability of the capitalist market. While there have been competing currents of leftist opinion, it is this notion of a rational state as opposed to an irrational market that has until recently carried the day. This is the background needed for any understanding of what has been a largely uncritical view of the potential of the state to install and oversee a socialist alternative. The legitimacy of the political state and the way it exercises power remains one of the Left’s major intellectual blind spots.

    Back in the 19th century the goal of a socialist republic was, for movements of the Left, just the logical conclusion of the democratic dream. Socialist theorists were increasingly aware that capitalism threatened the idea of a fully evolved democracy. Among their most treasured goals was the expansion of the franchise, given that the vote was then restricted largely to males with property. The main alternative in which those opposed to the system invested their hopes was a socialism brought about in one way or another through the democratic transformation of the state. In those days no-one doubted that the triumph of socialism meant more, not less, democracy. Opponents of socialism were staunchly opposed to such an expansion of democracy, seeing it as a form of threatening mob rule.

    Along with other pioneers of socialism, Karl Marx saw the state as the fulcrum that could leverage a fundamental redirection of economic life. Marx, though, had very ambivalent feelings about the state. He thought of it as a transitional phase in the achievement of a stateless form of communism based on the democratic self-rule of producers. He was deeply suspicious of the bourgeois form of the state and saw a radical democratic transformation of it as a necessary precursor to socialism – hence his enthusiasm for the direct democracy of the Paris Commune of 1871.

    The Centre-Left remains trapped in a parliamentary political culture where achieving snail-like incremental reforms is the cause of much self-congratulation

    But in his writings on the state Marx chose to use the unfortunate phrase ‘the dictatorship of the proletariat’ to describe this transitional phase. The word ‘dictatorship’ had a far different and more limited definition in the 19th century than it has today. It meant a kind of directed control that would resist the challenges of the partisans of capitalism (particularly those that profited from the private control of the means of production) to reverse what Marx saw as a primarily democratic transition. But Marxism (not unlike the Bible and the Qur’an) can and has been used to support many different and competing viewpoints and interests. This is certainly true of the notion of ‘the dictatorship of the proletariat’ that was picked up by Lenin and his Bolsheviks (and too many others) to justify whatever draconian police-state measures they deemed necessary to protect their notion of socialism.

    This blind spot about using state power to install socialism from above is common in different ways to the social democratic as well as the communist Left, and it has proved the undoing of the socialist hopes that were so strong in the 19th century. It has been consistently challenged by the advocates of change from below, be they anarchists or other libertarians of the Left. The debate has waxed and waned over the course of the last two centuries, with the ‘practical’ advocates of state power holding the upper hand for most of the time. However, the notion of an alternative from below has never entirely disappeared and, given the eclipse of the Leninist ethos and politics embedded in the communist world, it has become again the principal source of opposition to the tepid reformism of the centre-left tradition.

    Communism and social democracy

    Few would today disagree that over-reliance on a centralized state played a key role in the undoing of both the politics and economics of orthodox communism. The consequence was an alternative to capitalism that was decidedly unattractive, as it squeezed popular democracy and personal freedom while at the same time failing to deliver on the promise of economic prosperity. A highly centralized planning mechanism undermined any effective feedback from below on which to base decisions as to what and how much to produce.

    The result was a combination of shortages and oversupply that became a notorious feature plaguing state communist economies. The system was able to achieve a forced-march industrialization that enabled first the Soviet Union (and, much later, China) to survive in the face of aggression from Hitler’s fascism and other enemies. A certain level of initial equality and security in daily life was eventually undermined by a growth in popular aspirations for a freer life with a wider range of opportunity and economic possibility.

    These systems have now been transformed back into a kind of autocratic capitalism where economic growth (spectacular in the Chinese case) has replaced stagnation but at the cost of galloping inequality. The usual, if limited, political freedoms associated with ‘advanced’ capitalism remain atrophied under these new forms of state capitalism. Undoubted advances in the general level of prosperity have not been accompanied by an opening up of the rights to assembly and independent organization that would allow trade unions and social movements to resist exploitation and inequality effectively. The ideological glue that sustains Russia and China is no longer some communist ideal of equality or producer self-rule but instead Great Power nationalism and individual self-enrichment.

    The other strain of state socialism that has competed with orthodox communism is that of social democracy. This form of moderate socialism gradually separated itself from the (mostly European) revolutionary movements as it became a significant parliamentary force in the latter part of the 19th century. The divisions on the Left were less about democracy than about the speed and scope of the necessary changes, and about whether tactics should involve direct action by popular movements or be restricted to elected representatives of the working-class movement fighting for reform in parliaments. But gradually the Centre-Left learned that the simplest road to electoral success was to cohabit with the power of capital rather than mount a direct challenge to it. On such major questions as a militarized foreign policy, free trade, the rights of corporations, a significant redistribution of wealth, prioritizing growth over the environment and the overweening power of the national security state – the Centre-Left and the Centre-Right have broadly come to agree.

    Capital’s modernizers

    Today’s centre-left parties vary greatly. Few have gone (at least publicly) as far as Britain’s New Labour in their complete commitment to capitalist modernity. It is fair to say, however, that almost all now present themselves in one way or another as modernizers of capitalism rather than as positing an alternative to it. Their aim is to shave off the rough edges by making the system fairer and better thought-out. They underestimate the power of corporate actors to manipulate and undermine whatever ‘rules-based’ economy they envision; they underestimate the essential irrationality and instability on which this ‘most radical of all social systems’ thrives; and they underestimate the sheer inertia in the very structure of the state – a kind of in-built conservative bias that derails their chosen vehicle of reform. They also ignore the myriad ways in which the state is tied into the capitalist power structure – or else simply accept these as the inevitable price of political realism.

    This blind spot about using state power to install socialism from above is common in different ways to the social democratic as well as the communist Left

    Achieving high government office becomes a question of compromise and careers. It tends to trap the Centre-Left into managing the fundamentally undemocratic structures (including the security apparatus) of government, and this sucks all the oxygen out of any remaining social vision. The state in an advanced capitalist society is hemmed in by the sheer weight of the corporate economy on which it depends for the fundamentals of economic wellbeing: growth, taxes and jobs. This gives the corporate elite serious weight (often presented as a subtle form of blackmail) when it comes to blocking any kind of alternative – or even regulatory tinkering that would threaten corporate power and prerogatives.

    Only a radical government with a significant counterweight rooted in society has any hope of facing down such forces. But instead of building this kind of counterweight, the Centre-Left remains trapped in a parliamentary political culture where achieving snail-like incremental reforms is the cause of much self-congratulation. The very things that it criticizes elsewhere in the political culture – hierarchy, short-sightedness, a politics tuned to the news cycle, leadership through personality rather than programme – also shapes its own behaviour. Building the counterweight is then left to the social movements and ecological projects whose vision is not atrophied by this self-defeating form of compromise.

    Front cover, SOS Alternatives to Capitalism

    This article, and the July/August issue main theme ‘Capitalism is spinning out of control’ is based on Richard Swift’s book SOS: Alternatives to Capitalism, which is available to buy through the New Internationalist webshop.

    The anarchist impulse


    by Volker Straeter

    Traditional socialism’s great competitor in both thought and deed amongst those seeking a way out of capitalism has been the anarchism that first bloomed as a political theory in the 19th century. But the desire not to be subject to the arbitrary authority of others and to captain your own ship is as old as recorded memory.

    Capitalism has used this universal desire to cloak itself in a libertarian guise by proclaiming that the freedom of the market is the only realistic way to achieve this more general liberty. But this cloak quickly shreds for most people as the growth of corporate monopoly usurps economic and eventually political power – and as their labour activity (most of their waking hours) is reduced to a commodity to be bought and sold, and subject to the profit-seeking whims of a boss. From its early days, capitalism’s claim to represent the only realistic human freedom has been challenged by anarchists and other libertarian currents with their resounding ‘no’ to the arbitrariness of Big Property.

    Some anarchists – including the Russian noble Pyotr Kropotkin – saw the Neolithic village as a mostly peaceful and self-governing community before the formation of the state and predatory armies started to wreak havoc. Ancient and medieval history offer up plenty of examples that were often elaborate in their aspirations but partial in their achievement: Greek city states, slave revolts against Imperial Rome, monastic communities, heretical sects in revolt against religious authority, agrarian agitators all swam against the tide of arbitrary authority.

    Feminism has gone beyond the informal and personal to raise questions as to the legitimacy of how political power is exercised through the state

    Two figures who stand tall in historical memory are Thomas Müntzer, a leader of the peasant revolts in Germany in the early 16th century; and Gerrard Winstanley, an inspiration of the Diggers movement that defended the Commons at the tail-end of the English Revolution in the mid-17th century. Winstanley in particular recognized authority and property as a deadly combination that undermined popular liberty. 1

    The roots of formal anarchism can be traced back to the revolutions of 1848. That year a contagion of revolt against despotism spread across Europe – and not only where one would expect it, in revolutionary Paris, but also such previously unimaginable places as Vienna, which had long been under the brutal boot of Metternich’s Hapsburg Empire, and Berlin, which had been subject to the whims of the Prussian aristocracy. From Palermo to Prague, it was the kind of year when the spent ideologies and prerogatives of the old order came up for challenge by minds as well as feet and fists. The end of the year saw dashed hopes, slammed jail cell doors and too many corpses as the powers-that-be took their pound of flesh. In Paris thousands were executed without trial or even examination.

    After the failures of 1848, the anarchist movement underwent significant growth, particularly in France and the Slavic and Mediterranean countries. This was not just a question of a few isolated intellectuals but significant sections of working-class opinion, as with the watchmakers of the Swiss Jura or the workers from the marble quarries around the Italian town of Carrara. The continuing popularity of anarchist thinking could be seen clearly in the revolt of the Paris Commune in 1871, when the city rose against an enfeebled government, outraged by its failure to stop Prussian aggression. The influence of Pierre-Joseph Proudhon and the anarchists far outweighed any other socialist current.

    Ebb and flow

    After the defeat of the Commune, the anarchist movement dwindled to near invisibility. Indeed, as the anarchist writer George Woodcock often pointed out, the history of anarchism is one of recurrent ebb and flow.2 He sees a resurgence of libertarian thought and organizing again in the 1900s, with an ebb following the anarchists’ defeat at the hands of Bolshevism (1917-22) but another flow in the 1930s, when classical anarchism reached its high-water mark in Catalonia and Andalusia during the Spanish Civil War. Woodcock believes that, while there are historical correspondences between these different waves of anarchism, they were also shaped by very different contexts. He is not alone in seeing libertarian thought as vital to the formation of the international New Left in the 1960s. New Left notions of participatory democracy had much more of a libertarian than a Leninist ring to them. Although Woodcock never lived to see it, he would undoubtedly have recognized the influence of anarchism and other libertarian strains on the global justice and Occupy movements that animate current radical opposition to ever more dubious forms of capitalism.

    The Left is well known for its various splits and fissures. To some degree at least, this is because ideas and principles matter more than expediency in socialist culture. Perhaps none of these splits have been as momentous (and unfortunate) as two that took place at the end of the 19th century. In 1872, at a conference of the First International in The Hague, Marx and his allies expelled the anarchists who rallied around figures like Mikhail Bakunin, Errico Malatesta and James Guillaume. This event not only tragically split the forces of the Left but allowed for the evolution of more authoritarian strains of communism without the check of libertarian radicalism.

    The second fateful split came to a head in 1896, when the libertarian delegates were expelled from the International Socialist Congress. Principled socialists such as William Morris and Keir Hardie opposed the expulsion but for most social democrats the libertarian criticisms of electoral opportunism and ‘practical’ politics had become just too irritating. Within a generation, bureaucratism and capitulation had become so rife in social democracy that the parties lost their souls by rallying around their respective national flags in the slaughter of World War One.

    These parties also had a record of supporting the colonization policies of the European empires amongst the ‘lesser races’ of Asia and Africa. Without voices to raise doubts about the corruptions of conventional politics and state power, social democracy was gradually transformed from an alternative to capitalism to a more humane version of its management.

    A broader libertarian impulse

    It was not anarchists alone who foresaw and reacted to the problems of top-down power. Within the broader socialist movement voices started to be raised that were critical of both Bolshevism and social democracy for their willingness to use autocratic or conventional state power as the main means for implementing socialist measures. These included Paul Lafarge (Marx’s son-in-law) and William Morris, who challenged the orthodoxies not only about the state but also about the nature of work and the purpose of economic growth.

    The seminal figure to emerge as an advocate of a radical but libertarian socialism was, however, Rosa Luxemburg, who was a leader of the left wing of German social democracy. An adroit thinker and dedicated activist, she was quick to realize what would be the ultimate consequences of Bolshevism’s dogmatic interpretation and application of Marx’s ‘dictatorship of the proletariat’ in the Soviet Union. She engaged in political battle on all fronts. She was critical of the capitulations of the centre of German social democracy. She also regretted the autocratic Bolshevik short-cuts that undermined the fledgling power of the Russian working class, which had blossomed in the Soviets (workers’ councils) of 1917. But her hardest struggle, one in which she lost her life, was the workers’ revolt in 1919, which challenged the Junker class that had led Germany into the slaughter of World War One.

    Anarchism and other libertarian strains on the global justice and Occupy movements that animate current radical opposition to ever more dubious forms of capitalism

    The classical anarchism that did battle with Marx and the state socialists may be disappearing. The old doctrines of anarcho-syndicalism and ‘propaganda by the deed’ seem somewhat archaic in this era of mass depoliticization and eco-collapse. In their own way, anarchists too have believed in the Enlightenment notion of Progress with a big P. Murray Bookchin’s notion of a post-scarcity anarchism, with its glorification of liberatory technology is but one example – which, in fairness, Bookchin himself came to question.3 Maybe the real victory of anarchism is not in the triumph of large (if decentralized) organizations, bravery on the barricades or exposing the machinations of the deep state. Perhaps it lies more in the diffusion of a libertarian resistance to authority throughout society, particularly in modern social movements.

    A good example here is the rise of the feminist critique of male power and how it is exercised. Feminism has its anarchist roots, of course, in Emma Goldman, an early and persistent champion of women’s emancipation and critic of the sexual slavery she associated with patriarchy.4 The growing acceptance and assertion of women’s rights has eliminated or at least significantly challenged a large amount of arbitrary power over the lives of both women and men. But it has gone beyond the informal and personal to raise questions as to the legitimacy of how political power is exercised through the state. Feminism in its more radical manifestations has deepened the critique of instrumental power (generally wielded via the state by men) and posited a more local, self-affirming notion of power exercised through broad community participation.

    Social movements such as feminism exist within a broader milieu of ‘civil society’, which include such non-state actors as non-governmental organizations that advocate for the broader public interest and often act as watchdogs on state power. Perhaps the presence of some of the militant and uncompromising offspring of classical anarchism can act as a check to challenge civil society when it drifts in too statist or ‘professional’ a direction.

    SOS Alternatives to Capitalism cover

    This article, and the July/August issue main theme ‘Capitalism is spinning out of control’ is based on Richard Swift’s book SOS: Alternatives to Capitalism, which is available to buy through the New Internationalist webshop.

    1. Kenneth Rexroth, Communalism: From its Origins to the Twentieth Century , Seabury Press; New York, 1974.

    2. George Woodcock, Anarchism and the Anarchists, Quarry Press, Toronto, 1972.

    3. Murray Bookchin, Post-Scarcity Anarchism, Wildwood House, London 1974.

    4. Emma Goldman, The Traffic in Women and Other Essays, Times Change Press, New York, 1971.

    Capitalism’s stormy sea


    by Volker Straeter

    Capitalism as a total world system is a relatively new part of human experience. It has its roots in the 16th and 17th centuries, which means that it has been around for four or five hundred years at most, while we humans (Homo Sapiens) have been around for 200,000 years, reaching anatomical maturity some 50,000 years ago. Our ancestors (the less predatory Homo Erectus) go back over a million years. By these measures capitalism is merely the blink of an eye.

    Yet for most people living today this short time span is difficult to grasp. Partly this is because we have no relatives that remember pre-capitalism, and the oral tradition that used to pass historical knowledge from generation to generation has largely been disrupted by first literate and then media culture. There have been so many rapid technological changes over the past century that they add up to a kind of rupture in human memory. We have become future-oriented, addicted to novelty and ‘into’ discovering (and possessing) the latest thing in our rootless consumer universe.

    The commons played a large role in both economy and society all through the experience of pre-capitalist societies of various types – the commons being a shared resource from which each had the right to draw their livelihood, even if this livelihood was unequally shared under feudal conditions. The health of the commons – pasture land, gardens, woodland, water supply – was the concern of all. Economy was, as the social theorist Karl Polanyi has so brilliantly analysed, ‘socially embedded’ in such societies and subject to the prevailing values of that particular society rather than the kind of all-determining external force it has become under capitalism.1

    We speak of the stock market, for example, as if it is a living person – sometimes confident, sometimes jittery, feeling robust, suffering an attack of nerves and so on; a kind of Old Testament Mammon god

    As market relations began to disentangle the economic from the social and cultural, ever fewer human checks remained to slow down or redirect the disembodied drive for profit. Today we experience the economy as a kind of out-of-control external force disconnected from human will. We speak of the stock market, for example, as if it is a living person – sometimes confident, sometimes jittery, feeling robust, suffering an attack of nerves and so on; a kind of Old Testament Mammon god.

    Those who want to transform or even just tinker with our current system of corporate capitalism are confronted with a formidable task. What we face is something very far from the much discussed ‘level playing field’ that is supposed to characterize democratic competition. Those who want change by and large have little wealth. Those who wish to defend capitalism, by contrast, have a great deal of it and they have become expert at using their wealth to shape the political process to get what they want. Money and power are by now so closely linked together that it is discouraging even to contemplate how it could be otherwise.

    The result is that ‘politics’ (how we organize our affairs) has become such a dirty word that people eschew even such minimal public involvements as casting their ballots. There is, moreover, an unspoken but widely held view on the political Right that vote suppression (actively finding ways to discourage people from voting) is a legitimate tool in the political war chest.

    Creative destruction

    One of the features of capitalism that has enabled it to survive is its ability both to create and to take advantage of its economic crises. This phenomenon was investigated and systematized by the political economist Joseph Schumpeter, who referred to it as a tendency for ‘creative destruction’. Schumpeter saw this underlying attribute as a kind of positive resilience that keeps capitalism from collapsing under the weight of its own contradictions.

    For centuries, its opponents have looked to such crises as a source of hope, believing that the beast had finally overstepped the mark and could be brought to ground. These booms and busts are not new but have supplied the rhythm of the deployment of capital from the 16th century onwards, destabilizing people’s lives through the enclosure of the commons, the expansion of empires, and the shift of industry from less profitable to more profitable regions.

    This destabilizing effect has always been a major source of the dissatisfaction with capitalism. It has inspired people to search for alternatives that provide a more balanced and stable form of existence, where they can count on regular access to the fundamentals of their survival – food and shelter, peace and community. Capitalism constantly puts these things at risk in its restless search for new avenues of profitable growth.

    Those who, for moral, economic or political reasons, are opposed to the insecurity, inequality and egoism that seem inevitable consequences of the capitalist way of operating do, however, face a significant uphill challenge. Not only has capitalism shown great resilience in overcoming the periodic crises it has faced but it has also even been embraced by its one-time ideological opponents: state socialism in China and the countries of the former Soviet bloc. These societies have now surrendered to the market as the most effective economic driver of future development.

    Today, most of the public economies of such countries have come under the sway of private capital – much of it foreign. China, in particular, has become ‘the workshop of the world’, with its labour force working under extremely exploitative conditions within a political system that still proclaims itself communist. Yet dissenting activities still go on. ‘Mass incidents’ of labour unrest in China rose from 70,000 in 2004 to 180,000 in 2010 with virtually every economic sector affected.2 This has led some to identify contemporary China as ‘the epicentre of global labour unrest’.3 It is certainly one of the ironies of the modern world that what remains of this failed experiment in communism is being used to undermine the struggles of workers for a better life.

    Our current phase of capitalism is underpinned by a much named but too little understood political philosophy called neoliberalism. Usually this is a phrase used by critics rather than proponents of capitalism. Neoliberalism is a project that reduces all human activities to ‘homo economicus’ and takes in almost every sphere of life, from criminal justice to immigration. It has become a sort of moral-rearmament political doctrine to accompany the market fundamentalism of economic policy.

    In these highly individualized economic circumstances, it is not surprising that the slogan that has become most popular with panicky voters during repeated election cycles is: ‘it’s the economy, stupid’. This captures the limits of government possibility as seen through neoliberal eyes – no room for compassion, intergenerational consideration, concern about the planet, international responsibility or democracy beyond the narrow confines of elections. There is simply no meaning outside the cold calculus of the market.

    This is now starting to undermine the institutions with which the establishment has traditionally been identified – the legal system, the police, parliament, local government. Under earlier forms of liberal democracy these could be counted on to play a moderately autonomous role in tempering capitalism. Under neoliberalism they are increasingly shaped so that they will not be obstacles to market priorities. Neoliberalism redefines democracy as a kind of market rationality – and the only criterion to judge our political class by is how successful they are in ‘marketizing’ human relationships. This makes for difficult terrain on which alternatives to capitalism must be built.

    Front cover, SOS Alternatives to Capitalism

    This article, and the July/August issue main theme 'Capitalism is spinning out of control' is based on Richard Swift's book SOS: Alternatives to Capitalism, which is available to buy through the New Internationalist webshop.

    1. Karl Polanyi, The Great Transformation, Beacon Press, Boston, 1944.
    2. Bob McGuire, newsandletters.org Jan/Feb 2012.
    3. H Hung (ed), China and the Transformation of Global Capitalism, Johns Hopkins, Baltimore, 2009.

    Stop the gold rush!

    Hey, big spender! China’s first gold vending machine – it dispenses coins and bars – landed in busy Wangfujing Street, Beijing, in 2011. Each withdrawal is capped at a million yuan (about US$162,000) worth of gold.


    Weird stuff, gold. While it is almost without any practical use, it has become a standard of value that people are willing to kill and die for. It suffuses our language as some undefined aim we should all be striving to achieve – there’s ‘good as gold’, ‘going for gold’ (in Olympics parlance), gaining the ‘gold standard’ or sometimes just a simple exclamation of ‘gold!’ to emphasize excellence. Anything with which one can make money gets compared to gold: thus water becomes ‘liquid gold’ or oil ‘black gold’. At a more banal level, we all can feel blessed to pass under the golden arches of McDonald’s to get our burger and fries.

    We still have most of the gold that’s ever been panned or dug up. Still we move heaven and a lot of earth to get more. Exact figures vary, but a semi-official estimate claims there are now 171,300 tonnes of gold above ground (although some believe we have 16 times that). Whatever the amount, it doesn’t take up much space because it is so dense. At the semi-official estimate, if you placed it all in a giant cube it would measure just 20 metres on each side. At 16 times, the cube shoots up to 50 metres high.1

    We painstakingly dig gold out of the ground in some remote corner of the globe, then dutifully put it back under the ground in some vault or safe storage facility. What’s the point?

    We are now mining and stockpiling more gold (2,500 tonnes a year) than ever before, mostly for ‘investment’ purposes in bullion, coins, and seldom-worn jewellery.2 We painstakingly dig it out of the ground from an open pit mine, usually in some remote corner of the globe, then dutifully put it back under the ground in some vault or other safe storage facility. What’s the point, you might ask?

    Some vaults accumulate more than others, of course. The Federal Reserve vault in Manhattan is said to hold between 20 and 25 per cent of all the gold ever found.3 Many nation-states as well as private investors keep some of their bullion here. So, say the Bundesbank wants to buy gold from the Bank of England, the yellow stuff need never leave the Federal Reserve vault. A little team of security guards just loads it up and takes it from the British pile to the German pile. Again, you might ask: what’s the point?

    Worship and scepticism

    The roots of gold worship run deep in culture and history. It is usually associated with power. In Exodus even God gives intricate design instructions for how gold is to be used to decorate the places in which to worship him. On the other hand, the quick-tempered Moses was not at all pleased when he came down from the mountain with the 10 commandments and found the Israelites worshipping a golden calf. He immediately (presumably obeying God’s wishes) burned the calf in a fire, ground it to powder, scattered it on water, and forced the Israelites to drink it.4

    Moses’ actions speak to another hidden strain in Western and perhaps other cultures – a scepticism about gold, almost an anti-gold. The worshipping of the golden calf has come down to us as a kind of unseemly adoration of wealth or ‘mammon’. The Persians went so far as turning it into a means of execution when they forced their captive, the gold-loving Roman emperor Valerian, to swallow molten gold.

    One of numerous protests across Romania – here in Brasov, September 2013 – against government support for a plan to open Europe’s biggest open-cast goldmine in the small Carpathian town of Rosia Montana.

    Ionut David/Alamy

    More recently there were those great Hollywood films like Lust for Gold and The Treasure of the Sierra Madre. Who can forget the gold-crazed stare of Humphrey Bogart as the paranoid prospector Fred C Dobbs in the latter? The film was based on the novel by that mysterious anarchist writer B Traven, who had spent years observing how the gold lust of whites was tied to the misery of Mexico’s indigenous population.

    Then there was Lenin, the Russian Bolshevik leader, who proposed that gold be used to decorate public toilets in revolutionary Russia. Or the brilliant 20th-century economist John Maynard Keynes who thought of it as an ‘archaic relic’ that needed to be completely severed from currency value and public finance. These days Keynes has mostly got his way since ‘Tricky Dick’ Nixon cut the US dollar loose from being pegged to gold back in 1971.

    But even as a sideshow, gold searching and hoarding continues to plague the world. Today, digging up of the hyper-valued metal by rapacious mining companies (charmingly referred to simply as ‘miners’) meets resistance from local communities in alliance with environmentalists in almost every corner of every continent. The widespread use of toxic chemicals, the destructive nature of huge open-pit mines, the despoliation of precious water resources, a boom culture of thuggery and corruption all put meat on the bones of the case against gold.

    It was the Lydians, back around 600 BC in what is now western Turkey, who first used gold as currency instead of mere decoration. This made the demand for the stuff almost infinite. The egotistical political class quickly inscribed their own image on the currency – a practice they have continued to the present day.

    Public decorative gold today is an artefact of church and state. It tints domes and cupolas of parliament and mosque, adorns the crowns and sceptres of royalty, the braids and medals of military rank, is part of the trappings of most official rituals – essential to the sad pomp of power. This was well caught by the British colonial administrator Sir Frederick Hodgson when he went to Kumasi in 1900 to teach the gold-rich Ashantis of Ghana who was boss. Ashanti kings had for centuries perched on a golden stool that symbolically marked royal power. In writer Matthew Hart’s account:

    ‘Where is the golden stool?’ Hodgson
    demanded. ‘Why am I not sitting on the
    golden stool at this moment? I am the
    representative of the paramount power; why
    have you relegated me to this chair?’

    High wire capitalism

    Part of the appeal of gold is caught up with a swashbuckling history of ruthless pirates and conquistadors as they chopped down whoever stood between them and the shiny metal. The romance is sustained today by a kind of extreme capitalism of high-risk mining companies, often owned by dare-devil entrepreneurs in search of that big score. It’s a world of high-stakes trickery, price fixing, bribery and shell games – hostile takeovers and stock scams are a regular part of the ‘business model’. Gold is often found by small mining companies known as ‘juniors’ with only limited capital to start mining. The juniors then tend to exaggerate their ‘finds’ in order to attract the attention of ‘majors’ who they hope will get into a bidding war that allows the little guys to cash in big time.

    These days, levitating at the ridiculous price of well over $1,000 an ounce, gold is an extremely lucrative business. Back in the day when gold was linked to the value of currency it was believed to provide (at $35 or so an ounce) an anchor to prevent runaway inflation. For many central bankers and conservative economists this was holy writ. So much so that they were willing to plunge their fellow citizens into economic despair in order to ensure gold stocks. The depression of the 1930s is the classic case where governments cut desperately needed relief and refused economic stimulation in order to ‘protect’ their gold-backed currencies. Oddly, when the connection between gold and currency was finally severed by the Nixon administration, currencies were not affected by severe inflation but the price of gold went through the roof.

    The sky-high price ensures that gold and crime are now joined at the hip

    At current prices gold is becoming very troublesome. Remote mining sites have now become ‘economical’, endangering indigenous communities from Andean Latin America to central Africa. Previously abandoned old mines are being reopened across the world. Canada, New Zealand, Spain, California, Egypt – in almost every corner of the globe – mining scars that have previously healed are having their scabs ripped off.

    A classic example is Romania, where the controversial Rosia Montana mine in the western part of the country is in prospect of becoming Europe’s biggest goldmine. Goldmining had taken place there since Roman times but ceased decades ago. Now those gold-mad Canadians, this time led by Gabriel Resources, are promising a giant four-pit ‘project’. Resistance has been formidable with Romanians rallying to protect their beautiful Transylvanian countryside and traditional village life. Recent memories of a huge cyanide spill (in 2000) from the Baia Mare Australian/Romanian venture that poisoned Romanian rivers make the country particularly suspicious of goldmining. This environmental disaster, which many claim to be the worst in Europe since Chernobyl, is something Gabriel Resources promises could never happen at Rosia Montana.6

    Felonious temptations

    The sky-high price also ensures that gold and crime are now joined at the hip. Whether it is bribery (Turkey and Colombia), price-fixing (Barclay’s Bank in London), fraud (Canada’s Bre-X in Indonesia), tax evasion (Australia and the Philippines), counterfeiting (sophisticated fake or adulterated ‘gold’ sold in the Hong Kong trade) or smuggling (India), so-called ‘white collar’ crime has found a veritable playground in the gold market.

    And it is not just nonviolent crime. Forcing a goldmine down the throats of a reluctant local community can be a violent business. So can seeing off local miners who either have a prior claim or feel they have as much right to gold as some large foreign mining giant.

    The wounded, yawning mouth of Newmont Corporation’s massive open-cast gold and silver mine in Waihi, North Island, New Zealand/ Aotearoa.

    John Kershaw/Alamy

    All this can get quite ugly. Sometimes it is local police who do the dirty work for the mining industry. Recently official police have been used to assault anti-goldmine protesters at Skouries in northern Greece and to smash through a blockade of peaceful protesters at the El Tambor mine in Guatemala. The list of such actions is depressingly long. Of course, this isn’t technically crime because it is the police who are doing it. Often, though, it is also necessary for the ‘miners’ to supplement police by hiring private security guards to enforce their interests. And these forces can be simply a collection of local thugs.

    At their Porgera joint venture goldmine in Papua New Guinea, Barrick Gold (a Canadian ‘major’), was forced to seek exemption from legal recourse from 170 local women who accused Barrick security guards of gang rape. Once they had accepted a company ‘package’ these Ipili women sacrificed their right to bring legal action against the company.7

    In their North Mara mine near the Tanzanian border with Kenya, Barrick has another public relations disaster brewing. Over the past three years 69 illegal miners have been killed by police (tasked to protect the mine) who, it is widely believed, run a protection racket for illegal miners. The dead, presumably, wouldn’t or couldn’t pay. Before foreign companies took over, generations of poor Tanzanians had practised small-scale mining in the area. Now they have become ‘illegal’.

    In the deep mines of South Africa there is a virtual civil war between illegal ‘ghost’ miners (grey from spending too long underground) and the big mining companies who claim they lose 10 per cent of their gold (worth nearly half a billion dollars) to illegals.

    We need to stop this silly gold rush. Our species footprint needs to be reduced so that we can live within our ecological means. We can simply no longer afford to ‘rush’ about the globe digging up a shiny metal that is of marginal use and damn the consequences. We can’t afford the energy it takes to do it. We can’t afford the water it requires or is polluted in the process. We can’t afford to keep dumping the poisonous chemicals involved. We can’t afford the cowboy capitalism of mining companies that so easily degenerates into crime and thuggery. We need a different standard of value than gold – one that measures in clean air and water and sustainable incomes rather than some mystical pot at the end of an increasingly bedraggled rainbow.

    1. Ed Prior, ‘How much gold is there in the world?’, BBC News Magazine, 1 April 2013.

    2. numbersleuth.org/worlds-gold

    3. David Graeber, Debt, The First 5,000 Years, 2011.

    4. Peter Bernstein, The Power of Gold: The History of an Obsession, 2000.

    5. Matthew Hart, Gold: The Race for the World’s Most Seductive Metal, 2013.

    6. Claudia Ciobano, ‘The revolution begins with Rosia Montana’, 4 September 2013 openDemocracy

    7. Mining Watch Canada, ‘Rape victims must sign away rights to get remedy from Barrick’, 30 January 2013, miningwatch.ca

    Richard Swift is a former co-editor of this magazine. His most recent book (above) is SOS Alternatives to Capitalism, New Internationalist, 2014.