Stefan Stern: Marx was right about change

Even now, political leaders are advocating wholly orthodox approaches to managing deficits and currency volatility

Share
Related Topics

The pundit could not have been clearer. "Equities are cheap," she declared with wonderful certainty. In plain English what listeners to the Today programme were being told was that they should consider scrabbling together whatever spare cash they could to buy shares in stock-market companies. But we never got to hear which companies in particular we should be investing in. Equities may indeed be cheap. Then again, perhaps they aren't. I really don't know, and neither do you. And nor do any of the experts who earn a good living telling pension fund managers, insurance companies and other investors where to place their financial bets.

If you think you know for certain what will happen next to US unemployment levels, their budget deficit, the eurozone, Chinese inflation, or the price of oil, wheat or copper, you are either a genius (sorry, but that is unlikely) or deluded (I'm tending to option (b) here). That is not meant to be as rude as it sounds. I know no more, and possibly less, than you do.

At a time like this in the global economy confusion is a rational and not unhealthy response. But we should seize this moment to move on from confusion and enjoy intellectual liberation. That is what Charles Moore, the High Tory former Daily Telegraph editor and official biographer of Baroness Thatcher, has done.

In a recent column for that newspaper he shared his anxiety that "the left" may have been right about business all along. He summarised the workings of the free market in these terms: "The rich run a global system that allows them to accumulate capital and pay the lowest possible price for labour. The freedom that results applies only to them. The many simply have to work harder, in conditions that grow ever more insecure, to enrich the few." I'm not sure that the subject of his long-awaited biography would accept this characterisation of global capitalism.

Other respected figures are daring to say things that, perhaps only a few months ago, would have still been completely unsayable. Nouriel Roubini, professor of economics at the Stern school of business in New York, managed to produce "Marx was right" headlines after an interview with the Wall Street Journal last week. "Karl Marx got it right, at some point capitalism can destroy itself," he said. "We thought markets worked. They're not working."

Roubini earned himself the nickname "Dr Doom" – revealing label – for being among the first economic commentators to declare that all was not well in the world's financial system. I first heard him speak at a conference in Tel Aviv about five years ago, before the crisis started. Seemingly without pausing for breath for around 30 minutes, he explained calmly why things looked grim for the global economy. But it was still possible, then, to disregard his warnings as over-the-top and unnecessarily pessimistic.

That, of course, is the psychological problem which lies behind politicians' and financiers' reluctance (or inability) to recognise that radical change in their system is required. Everyone is more comfortable with familiar orthodoxy. When a critical voice is raised to suggest things are going badly wrong, it is easier to reject it as a misguided voice of doom. Whistleblowers face this problem, whether employees in a business or organisation or participants in a network.

For two or three years after the credit crunch of 2007 first struck, newspapers and airwaves were filled with earnest people announcing that we must not at all costs go back to "business as usual". At that time expressing this view was a sure way to win supportive nodding from all who were listening. But the nodding dogs did not really mean it. They have reverted to type. Perhaps this is what has provoked figures such as Professor Roubini to ratchet up the rhetoric a bit more.

Even now, most global financial institutions and political leaders are advocating wholly orthodox approaches to managing budget deficits and currency volatility, even as their efforts are revealed as being more or less futile, or worse. The truth is perhaps too scary for some to contemplate. Either that, or the temporary winners of the current system are simply filling their boots with as much as they can before the next, potentially even bigger crash.

Those who regard the recent actions of rioters in English cities as "criminality pure and simple" will not see any connection between Roubini's declaration that "Marx was right" and the decision to steal a 42-inch TV from a burning electricals store. But, for some, looting may have seemed a sensible (if illegal) response to the apparently continuous turmoil of the economy. If everything about your financial future seems at best uncertain and at worst desperate, why not carpe diem, or carpe television at any rate? Rational economic man (and woman) has finally been sighted, legging it down Tottenham High Street in a new pair of trainers.

Marx said that while interpreting the world was all very well, the point was to change it. If capitalists want to keep their world safe for capitalism, they need to face up to what is wrong with it, and change it, fast.



The writer is visiting professor of management practice at Cass Business School, London

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Senior Digital Marketing Consultant

£28000 - £45000 per annum: Recruitment Genius: A Senior Digital Marketing Cons...

Recruitment Genius: Assistant Stores Keeper

£16640 - £18500 per annum: Recruitment Genius: An Assistant Stores Keeper is r...

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Software Developer - C# / ASP.NET / SQL

£17000 - £30000 per annum: Recruitment Genius: Developer required to join a bu...

Day In a Page

 

General Election 2015: The SNP and an SMC (Salmond-Murdoch Conspiracy)

Matthew Norman
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk