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Annulling Debts as a Great Step

"The goal must be redefined beyond goods production and abstract labor, beyond the market and the state.. The great step of debt cancellation occurs when the burden can no longer be endured.The new finance capitalism since the 1980s is a speculative bubble-and debt capitalism.."

By Robert Kurz

[This article originally published in: Neues Deutschland, September 7, 2003 is translated from the German on the World Wide Web,  http://www.exit-online.org/html/druck.php.]

A radical criticism of the modern goods producing system is reproached for being esoteric, utopian, impractical and closed to negotiation or compromise. Even those pragmatists of the ruling order to whom the water is already up to their upper lip ask indignantly: Where is the alternative? What should we do differently? However all irritability against the exaction of system criticism is put aside when the crisis level continues rising. Coping or mastering a completely intolerable state of social reproduction with "creative organization" is now impossible..

This does not mean that the old dialectic of reform and revolution, fundamental criticism and limited daily demands, the way and the goal has become meaningless, even if it cannot be resolved as cheaply as in the times of the historical accumulation movement when the term socialism meant nothing but state capitalism and a variant of the goods producing system. The goal must be redefined beyond goods production and abstract labor, beyond the market and the state. There must also be ways to the new goal, transition forms and immanent partial demands that a social movement can adopt. A partial demand is also a demand, not an "organization" of the alleged practical necessities where one cannot demand anything any more but only creatively manage one's own social descent. To face even the smallest immanent demand, one must put the whole system completely in question theoretically and programmatically.

An immanent alternative to the present political management of the public and private financial distress was the resolute struggle to annul the debts of all the insolvent. This often occurred in history since the Athenian legislator Solon in 394 B.C. who liberated the small Attic farmers from debt bondage: the great step of debt cancellation when the burden can no longer be endured. Today this befalls the states of the third world, communes and debt-heavy private households of all countries. The destitute can no longer dig deep. All debt rescheduling deferments, transfers and so forth are only eyewash. The absolute limit is reached when the whole public and social life collapses as in countries like Argentina, when German communes close or make prohibitively expensive their libraries, swimming pools and social institutions, when millions of households are denied telephone, gas and electricity or people lose their housing.

The problem is obviously system-conditioned. Capitalist real-accumulation has long reached its inner limit in the 3rd industrial revolution. For want of profitable real investments, money capital flows in the financial superstructure and produces speculative financial bubbles. Simultaneously and for the same reason, real incomes collapse. States, communes and private households must become heavily indebted to unparalleled extents. The new finance capitalism since the 1980s is a speculative bubble- and a debt capitalism. Sometime or other the end of the flagpole will be reached. The bubbles burst and the debts can no longer be paid. Let us face this prospect now.

While the bubbles burst by themselves, the unpayable debts become the theme of the battle of interests and politics. The political-economic representatives of the new crisis capitalism and the administrators of financial assets and financial investments cannot do anything but persist in their unreal demands. However if the substance of the ledger money should be maintained come hell or high water, the social reproduction crumbles in ruins. Politics stands on the side of the creditor institutions as their bodyguard. The financial-capitalist fiction should be preserved at any price even though the debt mass in the meantime is an imaginary accounting like the speculative stock prices. The demand for the great step, for annulling unpayable debts is in the air so to speak.

Obviously this would be a deep incision in the reproduction of capital. Creditors must simply write off their demands in toto, not only in dribs and drabs. They will be dispossessed from their merely monetary titles of ownership. This will mean the ruin of many financial institutions, banks, funds, owners of great financial assets and so forth. This is unavoidable. Therefore the ideologies of crisis capitalism complain that a great step would mean a setback of paid laborers. However this could be easily avoided since the state and the security fund must guarantee financial investments to a certain extent... Everything that goes beyond this must be written off.

The great step of debt cancellation should not be interpreted as the final solution and overcoming of capitalism. This misinterpretation appears in a convoluted capitalism criticism that mistakes finance capital with the capital relation. Marx described this as a vulgar "popular prejudice". The logic of the crisis is turned upside down. Financial bubble- and debt capitalism appears as the cause of the crisis generally brought about by malicious profit seeking, not as a consequence of the inner limit of real accumulation. Anti-Semitism with the personification of an imaginary "rapacious" Jewish capital is not far away.

Emancipatory thinking must be sharply distinguished from vulgar economic Keynesianism, ideologically irrational and often ethnic-neo-nazi interpretations. A partial demand to immediately ward off the destruction of social reproduction is involved. The summons to the great step, for annulling all unpayable debts of the 3rd world and beyond can be an important motive of the new worldwide social movement.

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more texts 28.Jul.2004 11:35

Steve Roy