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Why capitalism is not the answer

By Liz Ross - posted Wednesday, 3 December 2008

If I were to sum up this contribution, a quote from the American environmental scientist Robert Newman perhaps fits the bill: “You can either have capitalism or a habitable planet. One or the other, not both.”

But we have to then ask - and answer - the question: how do we get to have a habitable planet?

That we face an environmental crisis is beyond question. Whether it’s global warming, pollution, plundering the forests and oceans, just to mention a few issues, the earth is in a dire state. And things are only getting worse. As the damning IPCC report out in November 2007 suggested and every environmental report since, it’s coming sooner - much sooner - than previously predicted.


And our rulers - to paraphrase a famous saying, “fiddle while the planet burns”. Australia’s environmental performance, despite all the hype that Wong, Garrett and Rudd mouth, is now ranked as third worst on environmental issues of the world’s 21 richest nations.

What about all those companies which are “going green” or those new firms producing renewable energy equipment, water tanks, or environment-friendly household products?

Doesn’t all this mean that capitalism is capable of fundamentally reforming itself? After all it’s not hard to see that this society is one of history’s most innovative and productive systems ever.

As British socialist Chris Harman recently pointed out, governments and businesses do have a genuine interest in stopping climate change. Not in our interests certainly but, as he adds “just as their predecessors a century and a half ago had a genuine interest in dealing with typhoid and cholera in slum working class districts in order to stop the diseases affecting upper class districts as well”. He continues “What is at stake for them - the people running governments and business - now is greater. Not just their lives are threatened, but the stability of global capitalism.”

And while concern for their own survival is no doubt important to today’s ruling class, it’s the continuation of their system - global capitalism - that is the critical factor for them.

For example Henry Ford's great-grandson Bill, apparently a "passionate environmentalist", sees his mission in life as getting rid of the internal combustion engine that powers today’s cars. But again it’s the survival of business that matters. As he explains: “There is a rising tide of environmental awareness. Smart companies will get ahead of the wave. Those that don't will be wiped out.”


But isn’t that just the way the system works? For some companies there are profits, while others will go to the wall, but overall, so the argument goes, the system survives and we’ve seen a massive improvement in the quality of life for so many people - healthier and longer lives coupled with higher standard of living.

We can even point to the fact that capitalism has overseen the greatest productive bonanza the world has ever seen, making it possible for the first time in human history to feed, clothe, house and provide education, leisure time and the like for every single person on the planet. It’s also made it possible to devise the technology to clean up the planet, stop the global warming threat, use renewable energy, and so on.

So why do we argue that capitalism - more than any other human social system - not only cannot solve the environmental problems of today, but also, in and of itself, is the cause of the world’s ecological nightmares? Nightmares that we can only awake from by replacing capitalism itself.

We have to go back to the basics of how the system works. Capitalism divides society into two main classes, the ruling class (for example, factory owners, bankers, employers) and the working class.

Under the rule of the employers and the state forces that back them up, capital combines its two sources of wealth: the mass “socialised” labour power of workers in the factories, farms, offices and the like, associated with the necessary machinery (the computers, trucks, etc) with the second source, the world’s natural resources, to produce goods at a level never seen before.

These goods that are produced, however, do not belong to the workers who have made them - either for their own use or even to trade for other useful items. Nor do they have a say in what is produced. Instead they are the property of the employer, who then proceeds to sell these items for more than it cost to produce them - in other words, at a profit. A money profit that is pocketed by the employer rather than shared equally with all. And because the system runs on making profit, without it the company will collapse, this sets up a highly competitive world system as companies battle it out for market share and more profits.

So the result is that what drives this system forwards is not how these goods satisfy human needs for a living - though of course it must do that to a certain extent otherwise there will be no workers - but the driver is the money profit a capitalist can make from the sale of products. So if there’s a choice between human need and profit, profit will win out.

This is when you see the obscenity of food being dumped rather than sent to feed the malnourished or starving peoples of the world, who are too poor to buy them at the price that would deliver a profit.

Money profit has another property, apart from enriching the ruling class, that is crucial in its destructive potential. Unlike natural resources which can completely run out and cannot be accumulated, the goal of money profit is quantitatively unlimited, and it can continue to accumulate for so long as there is anything left standing. Hence the quote from Paul Burkett: “We may not like it, but the fact is that capitalism can survive any ecological catastrophe short of the extinction of human life.”

And the capitalists will continue to try to “improve” their productive processes to gain ever more profit.

As Karl Marx put it, “The division of labour [a highly efficient way of organising work] is necessarily followed by greater division of labour, the application of machinery by still greater application of machinery, works on a large scale by works on a still larger scale. That is the law [driven by competition] which again and again throws bourgeois production out of its old course and which compels capital to intensify the productive forces of labour, [and] because it has intensified them … [this] law gives capital no rest continually whispering in its ear ‘Go on! Go on!’”

Polish revolutionary Rosa Luxemburg explains in more detail how this drive for profit leads to environmental crises as the world is plundered. She writes “Capital, impelled to appropriate productive forces for the purposes of exploitation, ransacks the whole world; it procures its means of production from all corners of the earth, seizing them, if necessary by force, from all levels of civilisation and from all forms of society.”

Today we just have to look at the US in Iraq and Afghanistan - the murder of millions and the environmental trashing that comes from non-stop warfare to secure the oil and other resources to maintain US world domination - i.e. the domination of American capital.

Then there’s the competition for the riches of Africa, where the companies grow fat and the people starve and the local land is devastated; the wide-scale destruction of forests to grow corn for biofuel; or as global warming melts the ice around the Arctic, resource companies rush to lay claim to Greenland’s previously inaccessible oil, diamonds and gold. Or in Australia where we see the invasion of Aboriginal land to gouge out the uranium and other mineral resources for private profit.

Capital creates commodities that can be sold out of resources that once were free. As one commentator noted, carbon credits - part of the carbon trading process - “are a triumph of capitalism, creating a commodity from nothing - clean pockets of air - that gain value through being certified. They have created a market now worth between $10 and $30 billion.” This set The Economist - the British magazine for the bosses - to rubbing its hands with glee over such wealth creation adding its hope that, “perhaps soon, the best things in life will not be free”.

But crazy as this system may seem, a system that can never stand still, is forever expanding, what underpins the capitalist dilemma is that because of the constant innovation and improvement, as more and more workers are replaced by machinery, the system’s rate of profit actually declines. This leads the world’s capitalists to ever greater frenzies of production - especially arms production as occurred in the aftermath of World War II - as they try to counteract the system’s downward spiral.

So we get the economic crises that capitalism cannot escape.

A drive for money profit that forces ever greater production until there are market gluts and then falling prices, plummeting profits and financial collapse of the system. While every other human society faced crises of scarcity, capitalism is the only one that has crises of over-production. And as well, crises that can only be resolved by mass destruction of productive forces (the factories, farms, etc) and immiseration of millions of people either through wars or economic depressions.

With immediate profit as the driver of the system, not the real needs of humanity or a sustainable planet, capitalism is, in fact, indifferent to the fate of humanity and the world we live in. Marx wrote that Capital is “moved as much and as little by the sight of the coming degradation and final depopulation of the human race, as by the probable fall of the earth into the sun.”

So, for example, former US Secretary of State Madeline Albright, when asked whether the death of an estimated half million children in Iraq as result of the sanctions imposed in the 1990s, was a price worth paying, she replied “… the price - we think the price is worth it.”

To sum up: capitalism, a system whose driver is profit rather than human needs, must plunder and degrade the planet to feed its continuous expansion as it tries to counteract its inbuilt fault line - the tendency of the rate of profit to fall. Consequently, we argue, capitalism is directly responsible for the scale of destruction and if left to continue, will drive us ever closer to annihilation.

In the next article I'll discuss what the solutions are and basically argue only working class revolution, with production organised democratically to satisfy human need, can save the planet.

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See the Socialist Alternative pamphlet How capitalism is costing us the Earth. Also Mick Armstrong From Little things, big things grow. Order from

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About the Author

Liz Ross is an activist and member of Socialist Alternative.

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