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Central issues dominating politics in North Atlantic nations today include the impact of the economic crisis, its causes, state responses, and who will pay for the state responses. The crisis exemplifies capitalism’s inherent instability. It carries both risk and opportunity for capitalism. The risk is that its victims will question capitalism per se and possibly seek a different post-capitalist class structure. The opportunity lies in a devaluation of means of production and labor power that creates conditions for renewed capitalist growth. Supporters of capitalism work politically to minimize the risk and take advantage of the opportunity.

Supporters of neo-liberal forms of capitalism use the crisis to further agendas of privatization, marketization, and welfare state destruction. Their strategy (e.g. Tea Parties in US) enlists victims of the crisis in a new crusade against the state as cause of the crisis through its corrupt favoring of various scapegoats such as the “rich,” the “poor,” the” immigrants” and so on. Their goal is to shift the costs of the crisis and of the state’s crisis response onto the masses via austerity programs defined as attacks on the evil, irresponsible, and corrupt state. 

Supporters of welfare state capitalism use the crisis to resume the pre-1975 dominance of Keynesianism. Their strategy enlists workers and the left to support changing state policies and politicians to produce a capitalism with a human face. Their goal is (1) state borrowing (via deficits) for stimulus programs sufficient to employ the masses and achieve economic growth, and (2) use that growth to cover the costs of servicing the state’s increased debts and thereby avoid disruptive, dangerous social conflicts over who pays those servicing costs. 

Struggles between austerity and deficit-finance stimulus programs replay classic conflicts between neo-liberal and Keynesian supporters of capitalism. Hence a key political question: can the political left – or at least a large portion of it – refuse to be caught up in and thus coopted by this struggle between the different factions of capitalism’s supporters (see Marx’s parallel argument in Essay on Free Trade)? Can a left emerge that defines a different project, namely one that targets capitalism per se as the problem and the supersession of capitalism as the solution? Without such a left, North Atlantic politics will yield various contested mixtures of austerity and deficit-financed stimulus depending on the relative strengths of their supporters.

A new basic strategy for the left to respond effectively to this situation would supplement but also constrain – and thereby differ from – classical socialism. Beyond advocating (a) socialized over private property in means of production, and (b) planning over markets as the means of distributing productive resources and produced outputs, this new strategy would radically reorganize many production sites in society. There, instead of capitalist corporations’ boards of directors selected by major shareholders, collectives of all workers at each site would democratically decide what, how, and where to produce and who will receive distributions of the surpluses those workers produced. This reorganization would institutionally subsume the state to such collectives of workers whose surplus distributions would furnish the state’s means of functioning. This reorganization would immediately transform workers’ on-the-job lives and their powers as citizens. It would thereby add a micro-level democratization to the classic macro-changes – socialized property and planning – heretofore over-emphasized by classical socialism and communism.

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