The Impending World Recession

Prabhat Patnaik

IDEAs | January 16, 2023

The IMF managing director Kristalina Georgieva has now openly admitted that the year 2023 will witness the slowing down of the world economy to a point where as much as one-third of it will see an actual contraction in gross domestic product. This is because all the three major economic powers in the world, the US, the European Union, and China, will witness slowdowns, the last of these because of the renewed Covid upsurge. Of the three, Georgieva believes, the US will perform relatively better than the other two because of the resilience of its labour market; indeed the greater resilience of the US labour market provides some hope for the world economy as a whole.

There are two ironical elements in Georgieva’s remarks. The first is that the best prospects for the world economy today, even the IMF concedes if only implicitly, lie in workers’ incomes in the US not falling greatly. For an institution that has systematically advocated cuts in wages, whether in the form of remunerations or of social wages, as an essential part of its stabilisation-cum-structural adjustment policies, this is a surprising, though welcome, admission. Of course Georgieva, many would argue, is seeing US labour market resilience only as the result of US’s economic performance and not as its cause. But her considering it a “blessing” (though not an unmixed one for reasons we shall soon see) leaves one in no doubt that the demand-sustaining role of workers’ incomes is also being recognised by her.

The Euro Without German Industry

Michael Hudson | October 04, 2022

The reaction to the sabotage of three of the four Nord Stream 1 and 2 pipelines in four places on Monday, September 26, has focused on speculations about who did it and whether NATO will make a serious attempt to discover the answer. Yet instead of panic, there has been a great sigh of diplomatic relief, even calm. Disabling these pipelines ends the uncertainty and worries on the part of US/NATO diplomats that nearly reached a crisis proportion the previous week, when large demonstrations took place in Germany calling for the sanctions to end and to commission Nord Stream 2 to resolve the energy shortage. 

The German public was coming to understand what it will mean if their steel companies, fertilizer companies, glass companies and toilet-paper companies were shutting down. These companies were forecasting that they would have to go out of business entirely – or shift operations to the United States – if Germany did not withdraw from the trade and currency sanctions against Russia and permit Russian gas and oil imports to resume, and presumably to fall back from their astronomical eight to tenfold price increase.

Michael Hudson: A roadmap to escape the west’s stranglehold

Pepe Escobar

THE CRADLE | October 06, 2022

It is impossible to track the geoeconomic turbulence inherent to the “birth pangs” of the multipolar world without the insights of Professor Michael Hudson at the University of Missouri, and author of the already seminal The Destiny of Civilization.

In his latest essay, Professor Hudson digs deeper into Germany’s suicidal economic/financial policies; their effect on the already falling euro – and hints at some possibilities for fast integrating Eurasia and the Global South as a whole to try to break the Hegemon’s stranglehold.

That led to a series of email exchanges, especially about the future role of the yuan, where Hudson remarked:

“The Chinese whom I’ve talked to for years and years did not expect the dollar to weaken. They’re not crying about its rise, but they are concerned about flight capital from China as I think after the Party Congress [starting on October 16] there will be a crackdown on the Shanghai free-market advocacy. Pressure for the coming changes has been long building up. The spirit of reform to rein in ‘free markets’ was spreading among students over a decade ago, and they have been rising in the Party hierarchy.”

Dollar Decline to Make Americans Poorer, Economist Hudson Says

teleSUR | July 18, 2022

Image of U.S. dollar bills. | Photo: Twitter/ @business

The de-dollarization or decline of dollar hegemony will put the United States in a slow crash and make everyday Americans poorer. Other countries have to de-dollarize because of American foreign policy, which forces them to create an alternative, said Michael Hudson, professor of economics at the University of Missouri-Kansas City.

“Any country that supported land reform, any country that protected its economy and grew its own food, and any country that did anything the United States didn’t like, they have all the foreign exchange, and all the savings stolen,” Hudson said, adding that “so obviously, this has led countries no longer to keep their savings in the form of U.S. dollars.”

Dollar hegemony is the system where U.S. overseas military spending and other spending deficits result in U.S. dollar savings in foreign countries. Then, foreign central banks recycle their reserves in dollars in the form of purchasing U.S. treasuries. Dollar hegemony enabled Americans to have high living standards and to become rich even though the U.S. is de-industrialized.

A tightening world

Michael Roberts Blog | June 18, 2022

It’s been a big week for the major central banks. First, the European Central Bank (ECB) called an emergency meeting because government bond yields were rising sharply in the more indebted Eurozone economies like Italy and Spain.  That threatens to deliver a new sovereign debt crisis as happened after the Great Recession from 2010-2014, leading to the Greek nightmare.

Karl Marx: Historian of Social Times and Spaces

Red May TV | May 13, 2022

Drawing on current perspectives in philosophy of history and a rigorous reading of Karl Marx’s oeuvre, George Garcia-Quesada’s recent book, Karl Marx, Historian of Social Times and Spaces, demolishes the all-too-common portrayal of Marx as an evolutionary determinist. By unpacking Marx’s concepts of social space and social time, he highlights the ways it can explain dynamics of complex multilinear development of human societies and of capitalism in particular. Cordelia Belton and Edwad, hosts of the podcast REEL ABSTRACTION, lead an inquiry into the book and consult with Massimiliano Tomba, whose own book, Marx’s Temporalities shows that an adequate historiographical paradigm for capitalism must consider the plurality of temporal layers that come into conflict in modernity.

George Garcia Quesada, Massimiliano Tomba, Edwad, Cordelia Belton

SOURCE: https://www.youtube.com/watch?v=Rswhe2trn8A

[THIS ARTICLE IS POSTED HERE FOR NON-PROFIT, NON-COMMERCIAL, EDUCATIONAL PURPOSE. THE VIEWS EXPRESSED IN THIS ARTICLE ARE THAT OF ITS AUTHOR(S) AND DO NOT NECESSARILY REFLECT THE VIEW OF THE JOP]

Uno Kozo’s Theory of Crisis Today

Red May TV | May 28, 2022

This panel discusses and explores the new English translation of Uno Kozo’s Theory of Crisis (Brill 2021). Originally published in Japan and in Japanese in 1953, Uno’s Theory of Crisis presents a radical reinterpretation Marx’s Capital to clarify the inevitability and periodicity of capitalist crisis. Emphasizing how the commodification of labour-power is the fundamental cause of capitalist crisis, Uno’s Theory of Crisis differs from other Marxist theories of crisis that emphasize the cause of crisis in over-production/under-consumption, or else in the tendency of the profit rate to fall. The panel features scholars of Uno’s method for political economy and discusses how his Theory of Crisis can help us to write the history of class struggle in today’s conjuncture of multiple capitalist crisis.

Ken Kawashima, Wendy Matsumura, Gavin Walker, Dr. Richard Westra

SOURCE: https://www.youtube.com/watch?v=8RFCRthZsq4

[THIS ARTICLE IS POSTED HERE FOR NON-PROFIT, NON-COMMERCIAL, EDUCATIONAL PURPOSE. THE VIEWS EXPRESSED IN THIS ARTICLE ARE THAT OF ITS AUTHOR(S) AND DO NOT NECESSARILY REFLECT THE VIEW OF THE JOP]

Has globalisation ended?

Michael Roberts Blog | April 27, 2022

Apart from inflation and war, what grips current economic thought is the apparent failure of what mainstream economics likes to call ‘globalisation’.  What mainstream economics means by globalisation is the expansion of trade and capital flows freely across borders.  In 2000, the IMF identified four basic aspects of globalisation: trade and transactions, capital and investment movements, migration and movement of people, and the dissemination of knowledge.  All these components apparently took off from the early 1980s as part of the ‘neoliberal’ reversal of previous national macro-management policies adopted by governments in the environment of the Bretton Woods world economic order (ie US hegemony).  Then the call was to break down tariff barriers, quotas and other trade restrictions and allow the multi-nationals to trade ‘freely’ and to switch their investments abroad to cheap labour areas to boost profitability.  This would lead to global expansion and harmonious development of the productive forces and resources of the world, it was claimed.

Book Review

Work Without the Worker: Labour in the Age of Platform Capitalism

Phil Jones

Verso, London, 2021. 144 pp., £10.99 hb
ISBN 9781839760433

Reviewed by Katjo Buissink

Imagine a factory, employing hundreds or even thousands of workers, suddenly disappearing overnight. Its employees would find themselves without their next expected pay cheque and with zero right of appeal to a manager or HR representative. Even the most malfeasant industrialist would struggle to accomplish this. Yet for those working within the platform economy, completing many small digital tasks for often anonymised companies in exchange for subsistence level piece wages, the disappearance of an ‘employer’ along with promised wages is not as fantastic. It simply requires the corporation to delete their account on the platform within which a worker was hired.

Ukraine-Russia: like an earthquake

Michael Roberts Blog | March 20, 2022

“The war in Ukraine is like a powerful earthquake that will have ripple effects throughout the global economy, especially in poor countries”.  That’s how IMF chief Kristalina Georgieva described the impact of the war on the world economy.  Nobody can be sure of the magnitude of this quake but even on the most optimistic view, it is going to damage significantly the economies and livelihoods of not just the people of Ukraine and Russia, but also the rest of the 7bn people globally.  And it is happening just as the world economy was supposedly recovering from the plunge in output, incomes and living standards suffered from the COVID pandemic slump in 2020 – which was the widest and deepest global contraction (if relatively short) in over 100 years.