jump to navigation

Social democracy and late capitalist societies… April 17, 2017

Posted by WorldbyStorm in Uncategorized.

Interesting Prospect podcast recently on ‘The End for Labour?’. In it one contributor made the following point in answer to a question as to whether Pilketty’s book had had an influence in providing a possible solution for social democrat parties away from what seems like inexorable decline. The answer was that no it hadn’t, at least not beyond a limited circle of readers.

I think the wider electorate still has a strong sense of fairness and fair dealing and what they’re due but I don’t think it’s made people turn in the direction of social democrat parties. Which I find very puzzling because like you I find social democracy to be still quite as relevant for late capitalist societies as it has always been.

And in relation to Corbyn the contributor still found this puzzling suggesting that his views (Corbyn’s) in relation to the EU, foreign affairs, etc, were probably somewhat closer to ‘the people who have left the LP’ over those issues than any leader before him and yet he’s still not regarded with any respect. Of course one could introduce a massive caveat here which is that the UKIP level of support while not derisory is still pretty minor. And then the panel had to note the impact of the loss of Scotland. I cannot stop thinking that the loss of LP support in Scotland has been utterly under and unconsidered by those on the left. I suspect it may be the key factor in regard to a large range of areas in the future in terms of the development of the UK and so on.


1. CL - April 17, 2017

“Late” capitalism has been around for quite awhile

‘The term “late capitalism” was first used by Werner Sombart in his 1902 magnum opus Der Moderne Kapitalismus; Sombart distinguished between early capitalism, the heyday of capitalism and late capitalism. The term began to be used by socialists in Europe towards the end of the 1930s and in the 1940s, when many economists believed capitalism was doomed.’

Maybe we should use the term ‘capitalism’?

“French economist and best-selling author Thomas Piketty is to join the team of left-wing candidate Benoit Hamon in the run-up to France’s presidential election.”

“French economist Thomas Piketty has said he would back leftist presidential candidate Jean-Luc Mélenchon if his chosen candidate does not make the second round of the country’s elections, which begin on April 23.
Piketty supports the more mainstream left-winger Benoît Hamon, candidate for the Socialist Party. But with Hamon trailing in the polls, Piketty said he would prefer to vote for the radical independent Mélenchon rather than the centrist candidate Emmanuel Macron in the election’s second round, Le Monde reported.”


WorldbyStorm - April 17, 2017

Capitalism yes. But I do think that there are phases to capitalism, that it’s quite mutable in some respects and that probably needs parsing out descriptively – though I do take your point and I’d think ‘late’ could be superseded by a different term.


6to5against - April 17, 2017

Perhaps ‘reborn’ would be better than ‘late’?

I’m just finishing Piketty’s book, and it seems to me that capitalism is in fine fettle. The return on capital is as good as its ever been,and for the first time in generations is far more lucrative than wage growth. I think the figures are in the ball park of 4-5%, as opposed to 1%.

And if I’ve understood him right, it is now again close to impossible for most of us working for a living to gain anything like the wealth in our lifetimes that a small number will inherit. This wasn’t true for the last 80 years. The only loss that the truly wealthy must suffer as opposed to their equivalents over a century ago is that now many have to wait into their 50s to inherit their full wealth. Because their parents aren’t only super-wealthy, but also super-healthy.

I thought in 2008 that surely we would now turn away from neo-liberalism and back towards something approaching egalitarianism. But that hasn’t happened, and following Trump and Brexit, why should we believe it will?


Jim Monaghan - May 15, 2017

A new May/June 1968, but deeper and more widespread. Begging will not even things up.


Paddy Healy - May 15, 2017

Because capitalists are currently making big returns on capital does not mean that the capitalist system is in fine fettle. Capitalists were making huge returns on capital and enjoying huge growt in assets up to 6 months before the recent crash. This was not confined to Ireland.
Read Michael Roberts (Marxist Economist) Predictions 2016,2017
New World Economic Crash On The Way http://wp.me/pKzXa-ua Paddy Healy
Economists of right and left agree that the gap between the very rich and the general citizenry is widening. The wealth of the top Irish 12 increased by 6 billion last year!
In the hey-day of Imperialism and social democracy, Ccapitalists were able to enrich themselves while allowing workers in imperialist countries to make gains. That is the material basis of social democracy which is a phenomenon of imperialist countries. Irish social democracy was always “mickey mouse” because Irish capitalism missed the imperialist boat.
Social democracy is not principally a matter of political perceptions or egalitarian views. It had a material basis.
Social democratic leaderships of political parties and trade unions (British Unions-remember them!) can no longer deliver material gains without confronting the capitalist system itself. As Social democracy is based on a committment to reformist capitalism, it cannot do this.
Hence the crisis of Social democracy.
Despite all the valid and progressive statements of Jeremy Corbyn he is not succeeding politically
It is obvious that a revival of the Labour movement generally in the UK requires a huge mobilisation of the working class against Tory austerity. But Corbyn won’t do it and TGWU leader McCloskey wont do it either.
In the growing crisis of the world capitalist system revolutionary socialist leadership is needed even to protect existing working class gains. But sin scéal eile.


FergusD - May 16, 2017

I don’t think it is the case that capitalism is fine and the rate of profit is healthy. If it was, why the crisis? It sounds like Piketty is an under-consumptionist. According to this (sort of Keynesian) view greedy capitalists are taking too much wealth from the masses, who therefore cannot buy stuff, so sales fall and we have a crisis. Capitalists are so daft! (well they maybe but…). So we need a reformed capitalism that spreads the wealth a bit and allows sales and production to rise.

I think the rate of profit has been falling, for a long time, and this explains the end of the post-war boom. I would point to Andrew Kliman’s work:


I would also suggest a look at Tony Norfield’s work for teh pecularities of the UK and finance in this situation:


I think it (falling rate of profit) helps to explain the post 1960s explosion in financialisation (although financialisation has been happening for a long time) and the “class war” unleashed with the collapse of social democracy (which as Paddy Healy points out increasingly has no material basis – it is dependant on a healthy capitalism).


Paddy Healy - May 16, 2017

Dead Right Fergus!
Don’t Forget to Read Michael Roberts Blog Also: Economic Predictions 2016,2017


CL - May 16, 2017

-“Social democrats have thought they could ride the market, to make it subservient to social purposes; for example, relying on privatization to make social services more responsive to citizens-renamed-customers.
In the course of events they sacrificed the dignity of the public sphere and subjected its operation to the imperative of profitability. They also became agents of capitalist expansion at a time when capitalists were desperately looking for new business….
What makes me pessimistic, though, is the fate of Syriza — how they caved in to the pressures of the other governments, of the IMF, of their own middle class — and perhaps of their strange illusions on “the European idea.”-


6to5against - May 16, 2017

I don’t know about the current rates in profit. What I quoted from Piketty above is about the rate of return on capital, which is not quite the same thing.

His figures by their nature are averaged out over a number of countries and over quite some time, but they nevertheless show that the return on capital is in fine form. Having sunk as low as 1-2% in the post war years, it is now constantly over 5%. And on large (multi-billion euro) fortunes, it seems to be more like 7 – 8 %.

Coupled with this is the fact that, as capital has being growing for some time without the inconvenience of a world war, it has largely regained its value against wages that it had a century ago.

He makes a very good point wrt wealth in modern society. It is kept largely invisible and, as most have so little, they are inclined to believe that there is very little of it about. We hear about this here in Ireland, when we are told we can’t tax the rich because there simply aren’t enough of them.

There may well be clouds on the capitalist horizon. And all this may end. But I wasn’t justifying any of it in my point above. I was simply making the point that with right wing governments in power across the world, with figures as extreme as Trump and May in power, and with current returns on investment hitting record highs, it is a bit early to be talking about ‘late’ capitalism.


FergusD - May 16, 2017

Re: the point about “Late capitalism”, we don’t know when/if it will end so we can’t say it is “late” or not until then. “Later” maybe.

Indeed “rate of profit” is very hard to estimate, Kliman has a go at it. I suppose my point is that may economists, even of the left, don’t consider it and have abandoned Marx’s view on the causes of capitalist crisis. Of course maybe Marx was wrong, or is wrong now, but I don’t think so, I think the historical evidence stacks up. It matters because the “solution” will be different if you if you think it is under-consumption by the masses, beaten down by over-greedy capitalists, which is the problem or an intrinisic feature of capitalist production itself.


GW - May 16, 2017

Hm – just how the rate of profit should be measured is a contested question.

I’m suspicious of all forms of orthodoxy, Marxist included, and those who attribute the instability of capitalism to one factor like profit rate. But they may be right.

I’ve recently (in the last hour) got my copy of Shaikh’s ‘Capitalism: Competition, Conflict, Crises’ and I intend to read it from back to front. This book has a far greater claim to be the Das Kapital of the 21C than Piketty IMO, being equally well empirically grounded but with a fundamental assumption that capitalism is dynamic and unstable and driven by profit seeking rather then myths about ‘perfect markets and information’ and defective demand.

Shaikh in Chapter 16 also seems to show a fall in the rate profit as far as I can see, allthough the neo-liberal intervention significantly slowed the rate of fall. Other measures like the ‘profit share’, rose slightly according to Shaikh.

But I haven’t read either Roberts or Kilman’s books. Roberts’ blog is very good with empirical data and well argued positions and I mean to read his book after Shaikh’s.

What is undeniable is that corporate profits rose during the neo-liberal era by suppressing the wage share of increases in productivity very effectively.


2. Paddy Healy - May 15, 2017

Put this into the Mix-Whither Irish Social Democracy?
No Significant Change in May B&A Poll-Labour Drop Below 3% in Core Vote for First Time This Year
Discussion http://wp.me/pKzXa-jh
B&A Poll May 14 Margin of Error c. 3%
FF FG Lab SF Other/GR Undecided
Core% 21.7 22.4 2.9 14.9 15.5 22.6
Sinn Féin Core Vote 5 times that of Labour!!!


3. GW - May 15, 2017

The German SPD got trounced in the NRW regional elections (upwards of 15m voters) for a number of reasons – some of which had to do with their caving in to neoliberalism a long time ago.

As a result NRW will be ruled by a CDU and possibly FDP (think PDs but more transparently corruptible) coalition.

Die Linke frustratingly doubled their vote but just missed the 5% hurdle to get into the regional parliament.


4. FergusD - May 16, 2017

Apparently, if this site is correct, Paul Mason (quite high profile Leftie UK journalist and Momentum supporter) advocates an alliance between the “left” and “centre globalists”:




GW - May 16, 2017

Trots hate ex-Trots dept. Nothing new here.


FergusD - May 16, 2017

But Mason seems to be moving right nonetheless, if the report is true, whatever about Trots hating apostates. And he seems to have an influential role in Momentum, he speaks on Momentum platforms.


Alibaba - May 17, 2017

Yep, I agree Paul Mason has moved to the right. He is now a self-declared “radical social democrat”. His response to the Brexit referendum was for “a significant, temporary retreat from freedom of movement. That means – and my colleagues on the left need to accept this – that the British people, in effect, will have changed Labour’s position on immigration from below, by plebiscite.” This effectively means shut up and put up about bigoted views.

Or take this from Mason: ‘Labour needs to design a proposal that permits and encourages high beneficial migration, discourages and mitigates the impact of low-wage migration.’ I read this to mean let the educated and skilled workers from abroad take the jobs we can’t fill, but leave the low-paid, unskilled jobs to us. Or to put it differently, don’t raid our nests.

Furthermore, here’s Mason’s latest take on Corbyn and the Labour party manifesto:

‘At this point you have to consider what’s happening in the liberal centre. When everybody from Conservative Anna Soubry to Vince Cable, through to those on the Progress wing of Labour is talking about the need for a new centrist party, it is logical to assume someone has a plan to form one.

I think it would be a positive development. … If a new centrist party emerges, I am in favour of Labour seeking a formal alliance with it, and with the progressive nationalist parties, to oppose hard Brexit and pick up the pieces once economic chaos begins, and the victimisation of minorities starts in earnest.

There are far better examples than Macron v Mélenchon for the left to follow. In Berlin, for example, the city council is Red-Red-Green – an alliance between the social democrats, the former communists and the Greens. They don’t like each other, but they have to work together and negotiate a platform through give and take. It is much better to do it this way than the “winner takes all” battle that led to Labour’s new manifesto.’


At the manifesto launch yesterday Corbyn called unashamedly for freedom of movement and said “immigration is right”. All credit due. Not so, for Mason, it would seem.

Mason suggests the left should bend over backwards in compromise and alliances with the right and a coalition with slightly progressive elements. This means putting them in power with us, a recipe for disaster if ever I saw one. It is driven by desperation in the search for so-called electoral credibility for Labour and even neoliberal Macron. Well, that’s bargain basement radical social democracy for you.


Alibaba - May 17, 2017

Corbyn might have said “Immigration is good”. I can’t remember the exact words.


5. FergusD - May 17, 2017

Red-Red-Green is not the same as Labour-LibDem-new centrists-“progressive nationalists!!” Anyway. Mason is hopeless now.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: