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Issue #1533      1 February 2012


Needed: a new system

The Great Transformation: Shaping New Models was the theme of the World Economic Forum (WEF) held in Davos from January 25-29. The reference is to “new” models of capitalism. The “Arab Spring” protests demanding democratic rights and social justice, the Occupy Movement in the US and the millions of people across Europe who have taken to the streets are worrying governments and big business. People around the world are demanding jobs, social justice, democratic rights, and some are even questioning the system of capitalism. Inside the exclusive Swiss ski resort, 2,600 business and government leaders, academics and “safe” (not going to question the capitalist system itself) trade union and NGO leaders rubbed shoulders.

Outside the conference, the 50 or so protestors who braved the cold and camped in igloos, were prevented by 6,000 security forces from going near the streets of Davos. The armed fighter jets that patrolled the skies above proved ineffective when protestors decided to “occupy the sky” above the conference with large red weather balloons.

WEF managing director Lee Howell warned, “It’s no longer simply cyclical, with everybody down and everybody getting to go back up. This time some people may not get up.” His comments reflected those of many corporate and banking leaders, looking for ways to clean up their image and the need to address the inevitable deepening of the crisis and halt the growing protest actions by the victims of the crisis and austerity measures.

Speakers blamed poor corporate governance, development of technology, the greed of individual capitalists, anything but the capitalist system itself. Likewise their solution, their “new” models, included training more job-ready workers, the need to be “good corporate citizens”, philanthropy to the poorer nations, economic reforms within capitalism. But not a word suggesting the system might be the problem. They regurgitated the old “capitalism with a human face” in its various forms.

There was even a session on the future of capitalism which was sponsored by Time Magazine. (Yes, even the sessions had corporate sponsors – after all WEF is a massive money spinning capitalist venture!) Former ACTU president and now International Trade Union Confederation general secretary Sharan Burrow told delegates that the business community had “lost its moral compass”. “We must redesign the model. We must reset it. Stop the greed. Unless employers and workers sit down with governments, the system will continue to fail.” On the eve of the forum, Burrow had ruled out real change: “It is too simplistic to say we need a new system. The system is not working because of extraordinary greed, extraordinary inequality and attacks on workers’ rights that are leading to a crash in demand.”

Burrow told delegates: “We need to say if capitalism is going to sustain itself, if it is going to provide secure jobs, it has to distribute wealth evenly and it has to make a contribution to the common good.” Her comments only serve to mislead trade unions and workers that under capitalism wealth can be “distributed evenly” and there is such a thing as “the common good” between capitalists and the workers they exploit.

Burrow put forward a set of five principles: jobs; social protection, sustainable demand and decent work; financial regulation (dealing with speculative trading on financial markets and registration of credit rating agencies); fair and progressive taxation; and climate action. These are all progressive and desirable reforms, but even as reforms they are weak; they fail to address many of the pressing issues – privatisation, sackings of public servants, lower pensions, neo-liberal trade and financial deregulation, etc.

More importantly they divert attention from the cause of the crisis. As the statement issued by the 13th Meeting of Communist and Workers Parties in Athens last December stated, “… the crisis is a crisis of the system. It is not faults within the system but the system itself that is faulty, generating regular and periodic crises.

“It results from the sharpening of the main contradiction of capitalism between the social character of production and the private capitalist appropriation and not from any version of the management policy of the system or from any aberration based on the greed of some bankers or other capitalists, or from the lack of effective regulatory mechanisms. It highlights the historical boundaries of capitalism and the need to strengthen the struggles for anti-monopoly anti-capitalist ruptures, the revolutionary overthrow of capitalism.” (See Guardian #1532, 25-01-2012 – “We salute the people’s struggles”)

Next article – Speaking out for the disenfranchised

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