University of Western Sydney lecture

The global economic breakdown—a Marxist analysis

By Nick Beams
17 September 2010

The following lecture was delivered by Nick Beams, National Secretary of the Socialist Equality Party (Australia) and a member of the International Editorial Board of the World Socialist Web Site, at the University of Western Sydney on September 14, 2010. He was invited to speak by the School of Law and the School of Economics and Finance.

 

 

About 100 students and academics attended. The lecture was followed by a lively discussion during which Beams answered a number of questions ranging from the nature of finance capital to the character of the working class in modern society and the viability of socialism.

1. Tomorrow, September 15, marks the second anniversary of the collapse of the Wall Street investment bank Lehman Brothers. Its demise set in motion a chain of events that over the next three weeks saw a meltdown on Wall Street and brought the global financial system to the point of collapse. The US president went on national television to declare that “major sections of America’s financial system are at risk of shutting down,” warning that if emergency measures were not taken immediately, “America could slip into a financial panic.” Nothing like this had been seen since the 1930s.

Two years on what is the situation? The bailout operation organised by the major governments and central banks to provide trillions of dollars to the leading global financial institutions has ensured that the global financial system continues to function. But despite this massive financial rescue operation—the largest such action in the history of world capitalism, amounting by some estimates to at least $14 trillion, equivalent to one quarter of global GDP—the underlying systemic crisis that produced the meltdown has not been resolved. Rather, the provision of unprecedented amounts of finance has simply created new contradictions in the global capitalist economy as the European sovereign debt crisis of last May clearly indicated.

2. Two years after the financial collapse, it is clear that the global capitalist economy is ensnared in the most profound crisis since the Great Depression of the 1930s. In the United States almost 30 million people are either unemployed, under-employed or have dropped out of the workforce because of their inability to find a job. Half of those out of work have been jobless for more than six months. This is the highest long-term rate since the 1930s. There is discussion in the media of a “double-dip” recession. As far the US is concerned, there has not even been a so-called “recovery”.

3. If we turn to Europe, the situation is no better. The British people are about to be hit by a series of government spending and job cuts, the like of which have not been seen in the post-war period and which eclipse even those that took place under the notorious Thatcher government of the 1980s. On the continent of Europe, the project of a single currency, the euro, is under a cloud, despite the €750 billion bailout organised in May. No one believes the crisis has been overcome. Indeed, a recent note prepared by an analyst at Morgan Stanley’s London Office warned that government defaults on debt were inevitable. “The only question,” he wrote, “is not whether they will renege on their promises, but rather upon which of their promises they will renege, and what form it will take.” The sovereign debt crisis was not over and it was global. The basis for this analysis was that the crucial determinant of solvency was not the ratio of debt to GDP, but the ratio of debt to government revenue, out of which debt servicing must be made. Government revenue has experienced a bigger decline than the fall in GDP. Yesterday, the Financial Times’s European columnist Wolfgang Münchau wrote: “Two years after Lehman’s collapse, the fragility of the European banking sector is still an issue. I would bet we are still talking about it in five years. That, in turn, means the financial crisis will go on and on and on, at least in the eurozone.”

4. If we turn to the East we find continuing economic stagnation in Japan, so much so that it has lost its place as the world’s number two economy to China. Is the overall picture contradicted by the rise of China? Can its rising economic growth somehow provide a new base of stability for the world economy? Not at all, because, in the final analysis, the expansion of the Chinese economy depends on the growth of the world economy. It should be recalled that after the first great breakdown of the world capitalist economy in 1914, the United States enjoyed a massive boom in the 1920s only to collapse when it ran into the limits on its expansion imposed by the crisis in the world economy as a whole. At the end of 2008, China experienced a major crisis which the government sought to overcome with a stimulus package of $500 billion and a massive expansion of credit. It is estimated that in the year 2009 alone Chinese banks issued a record $1.4 trillion in new loans. Rather than becoming a new foundation for the global economy, the expansion of the China is more like a fever chart measuring the ongoing crisis of the global capitalist system.

5. How are we to comprehend these processes? It is of course necessary to abstract from the myriad of different economic events to grasp the fundamental trends of development. But such an abstraction must not do violence to the external objective reality and the processes we are seeking to comprehend. For this reason, all nationalist conceptions—such as those that seek to present Australia, or any other country, as somehow ploughing through the high seas of the global economy, seeking to weather global shocks, as if these were some kind of external factors—are profoundly unscientific. Some eighty years ago Leon Trotsky explained the basis for a scientific analysis. “Marxism,” he wrote, “takes its point of departure from world economy, not as a sum of national parts but as a mighty and an independent reality which has been created by the international division of labour and the world market, and which in our epoch imperiously dominates the national markets.”[1] Each national situation, he explained, could only be understood as an “original combination” of the basic features of the world process. This is the method I will seek to employ.

6. At the outset it should be noted that there is not only a crisis of the global capitalist economy but of the entire ideological framework within which the bourgeoisie and its representatives, in this case the economists, seek to explain it. The global economic breakdown is the most stunning refutation of the “free market” mantras that have prevailed over the past thirty years. According to these doctrines, the capitalist form of economic organisation is not only the highest achievement of mankind but in fact the only possible form of economic organisation in accord with the laws of reason, or, for the religiously inclined, with the view of the Almighty himself.

7. Just after the crisis began, Queen Elizabeth of England famously asked a group of British economists at the London School of Economics why none of them had seen the crisis coming. In the summer of 2009, the leaders of the economics profession in Britain met to draft a reply. After labouring mightily over the question, their letter, delivered to Buckingham Palace, concluded as follows: “In summary, Your Majesty, the failure to foresee the timing, extent and severity of the crisis and to head it off, while it had many causes, was principally a failure of the collective imagination of many bright people, both in this country and internationally, to understand the risks to the system as whole.”

This was a damning admission about the state of bourgeois economics, going to its very foundations. No account was taken of systemic risk because the fundamental assumption of all bourgeois economics is that there are no contradictions or processes within the capitalist economy that could threaten the system itself. Long before Francis Fukuyama famously declared the end of history following the dissolution of the Soviet Union, bourgeois economists had concluded that the capitalist market economy, based on private ownership of the means of production and private profit, was the only possible rational economic system because it was based on human nature itself.

8. Apart from these longstanding ideologies, there was a more immediate material reason. The most recent innovations in what passes for bourgeois economic theory, such as the efficient markets hypothesis, were a direct expression of the needs of finance capital which has assumed such a powerful role in the world capitalist economy over the past three decades. The efficient markets hypothesis holds that the market is always right because at any one point in time all available information has been priced into it. Consequently, no one can know more than the market and any attempt at regulation, based necessarily on partial or limited information, is inefficient.

Why has such rubbish been served up for so long as “science?” Because it serves definite financial interests. As one recent account put it: “Without the Efficient Markets Hypothesis, most of the trading and risk models used by major financial institutions would have to be junked.” [2] And, as we know, banks, investment firms and hedge funds made hundreds of billions of dollar in profits from the use of these models in financial trading and richly rewarded their executives and so-called investment strategists. Any warnings about the real situation in global financial markets were simply brushed aside. The former IMF chief economist Raghuran Rajan recalls in the introduction to his recently published book that he was severely criticised at the 2005 annual conclave of central bankers held at the end of August in Jackson Hole. Rajan had committed to the sin of pointing to growing problems in financial markets when the theme of the gathering was whether the retiring Federal Reserve Board chairman, Alan Greenspan, was “the best central banker in history, or just among the best.”[3]

9. Let me turn now to the analysis of this crisis based on the method of Marxism. Such an analysis must be grounded on the laws of capitalist economy and an understanding of the interaction between these laws and the historical development of capitalism, that they both condition and within which they operate. The bourgeois economist Joseph Schumpeter, much in vogue these days because of his notion of “creative destruction” under capitalism, was an opponent of Marxism. But he had a great appreciation of Marx’s method of analysis and his achievements. “There is … one thing of fundamental importance for the methodology of economics which he [Marx] actually achieved,” he wrote. “Economists always have either themselves done work in economic history or else used the historical work of others. But the facts of economic history were consigned to a separate compartment. They entered theory, if at all, merely in the role of illustrations, or possibly of verifications of results. They mixed with it only mechanically. Now Marx’s mixture is a chemical one: that is to say, he introduced them into the very argument that produces the results. He was the first economist of top rank to see and to teach systematically how economic theory may be turned into historical analysis and how the historical narrative may be turned into histoire raisonnée.”[4]

10. Marx only saw the beginning of the historical development of capitalism. His method of historical analysis was deepened in a very important respect in 1921 when Leon Trotsky introduced a concept that has proved vital in developing the analysis of the historical development of capitalism, above all in assessing the current breakdown.

When making an analysis, Trotsky explained, it was necessary to distinguish between the short-term fluctuations of the capitalist economy—boom, crisis, downturn, recession, recovery—and the longer term phases of development within which they occur. In 1921, it was clear that the severe recession into which all the major capitalist economies had plunged after the conclusion of World War I was over and an economic recovery was underway. Did this mean, as the bourgeois economists of the day strenuously maintained, that the breakdown of capitalism proclaimed by the Marxists was a figment of left-wing imagination? See, they declared, capitalism has survived, it has proved its viability and there is no historical justification for socialism, least of all for the Russian Revolution of 1917.

11. Trotsky’s analysis was developed both against these conceptions and a “left” interpretation which maintained that since the breakdown of 1914, capitalism was destined to suffer a never-ending downturn. Contrary to the assertions of the “lefts”, Trotsky explained that there were clear signs of an upturn and they would strengthen. But that said nothing about the historical viability of the capitalist system. It merely demonstrated that capitalism was alive and continued to “breathe”, just as a man continues to breathe up to the moment of his death. Capitalism was still alive, but there would be no return to the phase of capitalist expansion that had preceded World War I and in fact any boom would soon create the conditions for a new and deeper economic crisis.

That analysis was vindicated over the next period. Far from capitalism enjoying a stormy period of growth, it was only in 1925-26 that the European economies returned to the levels of production reached in the pre-war period. Then, just three years later, the Wall Street collapse of October 1929 signalled the onset of the Great Depression.

12. Was a new upswing in what Trotsky called the curve of capitalist development possible? Trotsky did not rule that out but he insisted it could take place only under very specific conditions.

“If we grant—and let us grant it for the moment—that the working class fails to rise in revolutionary struggle, but allows the bourgeoisie to rule the world’s destiny for a long number of years, say, two or three decades, then assuredly some sort of new equilibrium will be established. Europe will be thrown violently into reverse gear. Millions of European workers will die from unemployment and malnutrition. The United States will be compelled to reorient itself on the world market, reconvert its industry, and suffer curtailment for a considerable period. Afterwards, after a new world division of labour is thus established in agony for 15 or 20 or 25 years, a new epoch of capitalist upswing might perhaps ensure.”[5]

This remarkable analysis, which so accurately charted the course of the next 25 years was made in 1921. On the blood and bones of millions, a new capitalist upswing was made possible. However, the main point to which I want to draw your attention here is not the insightful character of Trotsky’s analysis, but the method on which it was based.

Trotsky was not the only figure at that time to take cognisance of the different phases of capitalist development. They were apparent to any economically literate observer. The great mid-Victorian boom of 1851 to 1873 was very different from the Great Depression of 1873 to 1896 that followed. This in turn was different from the capitalist expansion that took place in the first decade of the twentieth century.

These phases have continued in the period since Trotsky first began to analyse them. The inter-war period is very different from the post-war boom which, in turn, is different from the 1970s and 1980s, just as the period 1990 to 2008 clearly constitutes a new phase of capitalist development.

The question to be answered was not the existence of these phases but what gave rise to them.

Trotsky developed his analysis in opposition to the theories of the Russian economist Kondratiev who maintained that the long-term phases of development were conditioned by the economic processes of capitalism itself, in the same way as the short-term fluctuations of the business cycle. Trotsky, however, insisted that there was nothing automatic about the development of a capitalist upswing, it was conditioned by the “external conditions through whose channel capitalist development flows.” That analysis has been confirmed by the historical development of capitalism in the 70 years since Trotsky’s death.

13. The post-war boom, which began in the late 1940s, did not emerge from the automatic working out of economic processes. It was first of all made possible by the betrayals of the upsurge of the working class in the last years of World War II and in its immediate aftermath by its social democratic and Stalinist leaderships. These betrayals made possible the political restabilisation of the capitalist order—so discredited at least on the continent of Europe because of its collaboration with the Nazis—which was the precondition for the economic restructuring of the world economy under the leadership of the economically dominant United States. This restructuring facilitated the spread to the other major advanced capitalist countries of the more productive and technologically advanced methods of American production, thereby bringing about an increase in the rate of profit. This was the economic basis of the post-war boom.

14. For 25 years after the conclusion of the war, the world capitalist economy enjoyed unprecedented growth and economic stability. But the contradictions that had exploded in the first half of the twentieth century had not been overcome. The tendency of the rate of profit to fall, which appeared to have been overcome, reasserted itself from the mid-1960s onwards.

There were mounting tensions at the centre of the post-war international monetary arrangements. Under the 1944 Bretton Woods Agreement, major currencies were fixed in relation to each other and to the US dollar. The US dollar, in turn, was tied to gold at the rate of $35 per ounce. US dollars could, on demand, be redeemed for gold at this rate. Under this agreement, the US dollar effectively functioned as world money, thereby facilitating the revival of global trade and investment, which had all but collapsed in the decade of the 1930s, and which was critical to the expansion of the world capitalist economy as a whole.

However, while it functioned as world money, the US dollar remained the currency of a national state. This contradiction between its two functions began to emerge from the late 1950s onwards. The growth of international trade and investment required an outflow of dollars from the US to provide necessary international liquidity. At the same time, the more dollars that circulated in the rest of the world, the more the commitment to redeem those dollars for gold became untenable. On August 15, 1971 Nixon, faced with this contradiction, cut the Gordian Knot and severed the relationship between the dollar and gold.

15. The collapse of the Bretton Woods system from 1971 to 1973 and the emergence of a global recession in 1974-75 signalled the end of the post-war boom. The recession, which to that point was the deepest downturn since the 1930s, passed. But the conditions of the post-war boom did not return. Rather they gave way to the phenomenon of stagflation—that is, continuing high unemployment combined with record levels of inflation.

Just as the present crisis has been a devastating refutation of the doctrines of the “free market” that have prevailed in the last three decades, so the collapse of the post-war boom was an equally devastating refutation of the doctrines of Keynesianism that predominated in the 25 years following World War II.

According to these doctrines, government intervention in the economy could prevent the emergence of the conditions that had developed in the 1930s. We are all Keynesians now, US president Nixon had declared in 1969. But when confronted with the crisis of the mid-1970s, the application of Keynesian measures only made the crisis worse. The doctrine that somehow timely government intervention could manage the capitalist system lay in tatters. For the past thirty years, the Keynesians have denounced the proponents of the “free market”, insisting that if only there were a return to their policies at least the excesses of the capitalist system could be curbed. But they have never been able to answer the simple question: if Keynesian measures were responsible for the greatest expansion of capitalism in history—a period of benefits for all when a rising tide did lift all boats—why were they unable to prevent its collapse?

16. Capitalism responded to the crisis of the 1970s in the way it has always done: it undertook a massive restructuring of economic and social relations aimed at trying to restore expanded accumulation and overcome the downturn in the rate of profit. But there was nothing automatic or pre-ordained in this development. The bourgeoisie was only able to remain in the saddle and initiate this process from around 1979-80 onwards because it had been kept in power by the betrayals of the upsurge of the working class in the period 1968-75.

17. The economic restructuring, which can be dated roughly from the coming to power of the Reagan and Thatcher governments, involved the smashing up of the industries that had been at the centre of the post-war boom. Finance capital played a key role in this process. However, it would be wrong to see the rise of finance that began in this period as simply the outcome of the lack of profitable opportunities for investment. There was, of course, as Marx had noted, no lack of swindling and the promotion of swindling, but behind this lay the drive of capital to try to develop new methods of production and new technologies to lift the rate of profit of individual firms and corporations above the declining average.

Finance capital, as the representative of capital-in-general, played the most active role in the re-organisation of capitalist industry. Through mergers and takeovers, it forced the development of new technologies in the production process, imposed cost-cutting and in this way forced the disaggregation of production and outsourcing, thereby initiating the processes that we have come to know as the globalisation of production.

These measures were begun in the 1980s, but in and of themselves they were not able to lead to a new period of capitalist upswing. For that to take place there had to be a vast change in the external conditions within which capitalist production develops—a change in the economic topography.

18. That came with the dissolution of the Soviet Union and the integration of China into the global capitalist market, and the consequent abandonment of national economic planning in more backward capitalist countries—above all in India—and the introduction of a “free market” regime.

These changes brought about a vast shift in the structure of the world capitalist economy. Some two billion workers were added to the global labour market available to capital at wages far below those of their counterparts in the advanced capitalist countries. Fresh blood was injected into the arteries of the capitalist economy and this created the conditions for a new period of capitalist upswing starting from the 1990s.

(In the 1920s Trotsky had raised such a possibility if the Soviet Union was overturned and China enslaved. The re-integration of these regions into the capitalist world economy did not take place in the way envisaged by Trotsky but the point he made stands.)

19. The capitalist upswing that started in the 1990s, however, was not like anything that had gone before. The upswing that followed World War II was based on the spread of more productive American industrial methods to the rest of the world, above all to the other advanced capitalist countries. The increase in the rate of profit, which lay at the base of the boom, resulted from increases in the productivity of labour in the manufacturing industries of the major capitalist economies.

In the 1990s, a new mode of accumulation developed in which the major corporations in the advanced capitalist countries played a very different role in the value chain. They carried out the design of new products and the introduction of technological innovations at the start of the manufacturing process and organised the marketing of the products that emerged at the end. But the manufacturing processes were carried out by different firms in regions with cheaper labour. Some of those firms have now become very large. The Chinese firm, Foxconn, which has been in the news recently because of the suicide of at least 11 workers, has a workforce of more than 920,000. They churn out iPhones, PlayStations and Dell computers. There is a joke told by executives that in twenty years time there will only be two companies in the world: everything will be made by Foxconn and then sold by Wal-Mart.

There is some truth in the jest. It points to an entirely new mode of profit accumulation resulting from the global restructuring of the past twenty years. The question to be answered is: how has this led to the breakdown now underway?

20. The driving force of the capitalist mode of production is the extraction of surplus value from the working class. Increasingly, however, major corporations have been involved not so much in the extraction of surplus value as such, but rather in the appropriation of surplus value extracted elsewhere. Consider a 64-Gb iPod touch, retailing for about $400. Of this, only some $13 is accounted for by the labour of the workers at Foxconn. There is a large outlay on development of software programs and new technology. But this cost is spread over a large number of units and so constitutes a small fraction of the final price. With wages in China around a thirtieth or a twentieth what they would be in the US, there is a massive amount of surplus value extracted in the production process. But the vast bulk of this surplus value does not go to the manufacturer. It is distributed to the parent company Apple, the legal firms involved in protecting its brand, the shopping malls and retail outlets that distribute its products, the advertising agents that promote them and so on. It is a very different mode of profit accumulation from that developed by Henry Ford.

21. This shift in the mode of accumulation is expressed in the rise and rise of financialisation—that is, the accumulation of profit not through the direct extraction of surplus value, but through financial activities. General Motors, at one time the world’s largest industrial firm, is a case in point. Before its bankruptcy and restructuring, its financial arm, GMAC, was a greater source of profit than the manufacturing division. On this basis it could be argued that GM went from being an industrial firm with a finance arm to a financial corporation with an industrial arm.

22. The extent of financialisation can be seen in a series of statistics. Some thirty years ago, the profits of financial corporations in the US amounted to less than 10 percent of all corporate profits. By 2007 they amounted to around 40 percent.

In 1980 global GDP stood at $10 trillion, while global financial assets amounted to $12 trillion. In 2007, at the height of the finance boom, global financial assets were $196 trillion compared to global GDP of $55 trillion. That is, in the space of a quarter of a century, global financial assets had gone from just over 100 percent of global GDP to more than 350 percent. Or, to put it another way, in the period 1980 to 2007, financial assets grew around four times faster than global GDP.

23. The significance of this enormous disparity becomes clear when we consider what financial assets represent. They are not real wealth itself, but claims on wealth. A share in a company is not wealth as such but a property title—a claim on the profit generated by the company. Likewise a bond, whether issued by a corporation or a government. These property titles can themselves be traded, and such trading can be a source of profit. This gives rise to the illusion that money can simply beget money, without the need for any intervening production process—a kind of capitalist heaven. But in the final analysis, financial assets cannot break free from their earthly roots. They represent claims on real wealth.

What these figures point to is that these claims have now vastly outstripped their real foundation. How did this happen? It seemed that for a period of time finance capital was able to defy the laws of political economy. But only for a period. Eventually those laws asserted themselves in the same way, as Marx explained, that the law of gravity asserts itself when a house falls about our ears, that is, in the form of a crisis.

24. Finance capital continued to grow and ever-increasing profits were made as money was pumped into the financial system by the central banks. But the Great Moderation, as Federal Reserve chairman Bernanke termed it, a period of low interest rates and low inflation, meant that the rate of return, the yield on risky assets, declined. New, riskier assets had to be created in order to maintain a given rate of return. This whole process ended in the sub-prime debacle. Sub-prime credit was issued without regard to risk because it was assumed that, with the ongoing injection of liquidity into the financial system, house prices would continue to rise. When the US housing market started to fall and the sub-prime bubble collapsed, it set off a chain reaction throughout US and then the global financial system. The sub-prime crisis was only the catalyst for a crisis that had been in the making over the previous two decades.

25. When the crisis broke two years ago, governments and central banks around the world poured trillions of dollars into the banks and finance houses. The essence of this operation was clear: to take the worthless or “toxic assets” off the books of the banks and make them the responsibility of the state. After years of declaring that there was no money for social programs, suddenly there was money to be found everywhere. But this operation—the substitution of private debt by so-called public debt—did not solve the problem. It merely transferred it. Now the capitalist state has taken on the task of restoring value to the financial system. This involves a mass restructuring of social and class relations in a direct onslaught against the working class.

The so-called sovereign debt crisis of April and May was the means by which financial markets transmitted their orders to governments that this onslaught had to begin with the implementation of savage austerity programs.

26. The title of this lecture refers to the breakdown of capitalism. I hope my remarks have made it clear what is meant by this. A breakdown does not signify that the capitalist economy simply stops. Far from it. It signifies the opening of a new period of history in which the fate of society is decided for decades to come. How does that take place? Not by legislation or regulation but through the eruption of enormous social and class struggles. These struggles will assume revolutionary dimensions: the ruling classes can no longer rule in the old ways and the working class cannot live under the new conditions that are being imposed.

27. What will emerge from this crisis? According to a recently published book by economics writer Anatole Kaletsky it will be a new form of capitalism. Marx, he explains, was not wrong to point to contradictions within the capitalist mode of production. But he was wrong to insist that these contradictions led to its overthrow. Capitalism, he insists, does not break, it bends and adapts. Capitalism has faced crises in the past but it has developed through continuous adaptation. Some of these crises shook the system to its foundations but a new form of capitalism emerged. And so it will again.

28. It is true that capitalism did manage to emerge from the breakdown of 1914. But at what cost? A new equilibrium was eventually established but only on the basis, as Trotsky had warned, of the blood and bones of millions. Now another breakdown has taken place. Capitalism will seek to adapt itself to the new situation that it confronts. What form will this adaptation take? Two processes are involved here.

First, capital must adapt itself by intensifying the extraction of surplus value from the working class in order to facilitate the accumulation of capital. By what means? In the US, we see the introduction of below poverty level wages at GM—the starting rate for a worker is $14 an hour. The Obama administration has declared that the way forward for America lies in increasing its exports. But how is this to be done? Wages in the US must be driven down to meet those of its competitors. Social services, health and other provisions must be destroyed in order to make resources available for the financial system. These processes are being played out, with all their national variations, all over the world. In this country, the enormous instability in the political system and the highly unstable “two-track” economy are indications of what lies ahead.

Not only must class relations be “restructured” on a global scale but so also the relations between the major capitalist powers. In the aftermath of the catastrophe of the first four decades of the twentieth century, world capitalism was restabilised on the basis of the strength of American capitalism. Now the decline of American capitalism is itself at the very centre of the crisis. How will American imperialism seek to extricate itself? By military means. Enormous geo-political tensions are developing as can be seen so clearly in this region as the antagonism between America and China grows. These conflicts recall nothing so much as the antagonisms of the 1930s. They will have the same outcome, war. Only this time, rather than ending with the nuclear weapons, they will commence with their deployment.

Capitalism will “adapt” itself we are told by its defenders. Yes it will. But the forms of “adaptation” threaten the very existence of human civilisation. That is why it must be overthrown and replaced by a rationally planned world socialist economy in order that humanity can resume its historical progress.

Footnotes:

[1] Leon Trotsky, The Permanent Revolution, New Park London, 1975, p. 22. [back]

[2] Anatole Kaletsky, Capitalism 4.0, Bloomsbury, London, 2010, p. 177. [back]

[3] Raghuram G. Rajan, Fault Lines, Princeton University Press, Princeton, 2010, p. 3. [back]

[4] Joseph Schumpeter, Capitalism Socialism and Democracy, Allen and Unwin, London, 1976, p. 44. [back]

[5] Leon Trotsky, The First Five Years of the Communist International, vol. 1, New Park, London, 1973, p. 263. [back]