Peoples' movements and protests




How peoples’ movements force the powers to become serious



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By Jan Wiklund



The rulers of the world have seldom behaved in such a selfish and stupid way as they did the last few decades. The speculative economy almost collapsed in 2007. Thereafter, they have franticaly and repeatedly thrown fresh resources into the speculators’ purses, at the expense of the majority, with unemployment and misery as a result. If they have ever discredited themselves, it is now.
However, these things seem to repeat themselves periodically.

Almost 100 years ago, a Russian economist noticed that there appeared to be long cycles of economic development, lasting about fifty years. Every fifty years, the economy went on full speed, while in between there was a deep crisis when most of the capital was devoted to Ponzi schemes and other speculative pursuits. The cycles are called Kondratiev cycles after him.

There was for a long time some uncertainty about what these cycles were due to. The heterodox economist Joseph Schumpeter suggested in the 40s that it was perhaps only every fifty year that there was something serious to invest in, and the Venezolan economist Carlota Pérez wrote something exciting about that ten years ago: when the capacity of such a wave has become so high that there is no efficient demand for everything that can be produced, the capitalists go speculating instead, and from this speculation, in the best possible case new products will appear to be invested in. Each production wave also brings a lot of follow-up investments and new technologies, and a reorganization of the whole society. Which creates ”full employment” as long as it lasts.

Kondratiev, and Pérez, point to four Kondratiev waves in the history of industrial society.

The first great speculative wave lasted 1775-1795. Then, the ruling class tpulled itself together and invested in the freshest technological breakthroughs at the time, textile industry machines and canals.

About 1830, it was time for the next speculative wave, which lasted until about 1850. Then they pulled themselves together once more, and invested in the newest and freshest - railways and steam engines.

This lasted until about 1875 when a new twenty-year speculation period took place. It ended in about 1895, with new serious investments, this time in steel, electricity and chemistry.

And this lasted until about when speculation took over again. It went on until World War II when production started again. This time cars and home appliances were the new things.

Neither Kondratiev, Schumpeter nor Pérez say anything about is why yesterday's speculators suddenly become serious and start investing in material production. Ponzi schemes are actually easier to organize than production, so why should they bother?
The answer may be not so far away. It’s sufficient to look for why the last Kondratiev cycle started.

Some suggest that it was due to the war. They are partly right - it was partly because of the war that it became politically possible to target resources on material production instead of letting the capitalists play as they pleased. But another factor also helped: fear of mobilized people movements.

In both the pioneer areas of Keynesian politics, the Nordic countries and the United States, labor movements had been extremely militant and well organized during the speculation period. Sweden hade the strike championship of the world in the 20’s, the United States had it in the 30’s.

In addition, largest anti-colonial movements of the 20th century were in full swing in India, while in China a radical nationalist regime took over at the very beginning of the investment wave. In addition, as many have pointed out, Russia was there as another radical challenger. It was to prevent Russian influence in Europe, the United States lent money for reconstruction after the war on generous terms, instead of using the resources for home-grown profits.

With this in mind we can look at the other shifts from speculation to production.

1795 - this was just after the French Revolution, when fear of populist democracy still plagued Europe's rulers and forced them to act seriously for a while.

1850 - this was just after the world’s first organized labor movement, the Chartists, and just after the revolutions of 1848

1895 - this was precisely when trade unions had started seriously to mass-organize in Europe.

In all cases, the peoples’ movements considered the rulers as totally illegitimate and only worth getting rid of. The only way the rulers could find to stay in power was to become serious, to divide the people’s movement alliance, if possible, and to get the more privileged parts thereof to support themselves instead.

Right now, the shift is delayed. The current speculation period has already lasted twice as long as the previous ones. People’s movement mobilizations this time have been weaker and more localized than previous times. In particular, they have been weak in the core countries of the global economy – except in China where a strong labour mobilization has rucceeded in raising wages three- to fivefold in a decade. Otherwise, only India and Latin America have marked themselves out with fairly impressive movements – agrarian movements in India, indigenous and slum movements in Latin America.

Accordingly, ruling classes in these countries have been the only ones to behave somewhat seriously during the last few decades.

To regain the seriousness of the 50s and 60s, we would need some huge movement mobilizations indeed, to match an economy which is so much greater than it was when the last Kondratiev wave started.

Will we?

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