Capitalism Does Not Repeat Itself

Robert Kurz

In terms of lifestyle, it’s called nostalgia: namely, the memory of supposedly better times, for example, of the economic miracle. In pop culture, it’s called “retro”: When producers can’t think of anything else, they rehash old stuff in a slightly different form. And when you watch “Tatort” on TV, you have to make sure you haven’t already seen it a few years ago. Nothing new under the sun, that seems to be the motto. Somehow, the belief has spread that if you want to find a recipe for the present, all you have to do is look to the past. Why else are politicians, the media and economists constantly looking for historical parallels in the crisis developments of recent years? Anyone who opens the newspaper often believes they have been transported to a history lesson.

Breakneck financial speculation, minor and major crises, a host of state bankruptcies, even the odd failed monetary union – the economic historians of modern times have just about everything on offer. And the moral of the story? It’s all been there before, which also means that everything is not so bad, everything can be overcome on the basis of the prevailing facts. Not only is wishful thinking the father of thought here, but also a certain image of capitalism as the eternal return of the same. Sometimes the economy is humming, sometimes it is crashing; there are up-and-comers and down-and-comers of the year or the century. But in principle, so the belief goes, it will always go on like this.

However, this is a mistake. We are not dealing with a static system, but with a dynamic one. Capitalism does not repeat itself, nor does it go round in circles, because it is itself an irreversible historical process. Capital valorization does not always start from scratch, but on a social scale it must exceed its last level if it is to continue. The degree of global economic integration cannot be turned back, and neither can the development of the productive forces. Universal competition ensures that this is the case.

But if globalization and productivity are developing ever higher, why should the character, depth and scope of crises always remain the same? The fondly told story of the tulip bulb speculation on the Amsterdam stock exchange in the 17th century teaches us nothing about the real estate bubble of 2008 and the bankruptcy of Lehman Brothers. To understand that a sovereign bankruptcy in the early 19th century was something quite different from what it would be today, just look at the government’s share of the national product. The current history lesson of the experts and media tea-leaves readers is a witching hour.

Again and again, one hears the claim that politics and management have learned so much from the crises of the past that today there are sufficient instruments and tools available for coping with them. At most, the diagnosticians argue about whether the crisis is now one like 1872 or possibly one like 1929 or merely one like 1973. The learning success seems to be a minor one when governments and central banks prove to us every day that their economic and monetary policy concepts are about as helpful and competent as the toolbox of a steam locomotive for the emergency repair of an high-speed train. Anyone who talks as much about the future as the elites of the present should not rely too much on the system rescues of the past. In the memory of mankind, the old rescue packages and their consequences tend to go down as disasters anyway.

Originally published in Neuen Deutschland on 12/12/2011

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