Contradictions can be seen on both a global and national level can be summarised as a Capitalist crisis of imbalances of development that begun in 1914. At present a new aspect of this crisis is revealed in credit and debt dilemmas that go back to the Bretton Woods Agreement 1971, etc. From over thirty years ago; the shift from gold standard to the US greenback aided the US at first, but has worked against it later. The manufacturing structure of the US has since been challenged by China , Japan, India and other countries and allowed the US to deteriorate. There has been a shift in real wealth from the US to these countries. The rise of wealth in China and India has been parallel the growth of debt in the US. Unregulated Capitalism has attempted to make money out of other money as ‘fictional finance’ and fictional capital (such as unused office space, etc) Moving from real money to electronic money and towards ever greater abstract finance simulated global finance in the US enjoyed free play across the world. The fall of the USSR and the opening up of China and Asia helped the US prosper with cheap labour and markets and fantasy money and capital has made good use of them. This postponed the US economic crisis for awhile. Hedge funds arose with Investment groups that flew around the world seeking to exploit all markets (they brought down stock market in Thailand).US manufacturing fell further behind and infrastructure declined. Whilst more of the country moved into ever increasing debt that has been hidden. Unemployment affected peoples purchasing power. Living standards in the US are now so bad that the division between rich and poor is now as terrible as it was in 1917; the year of the Russian Revolution .One child in four in the US now lives in poverty. No one knows in today’s world what was real credit and real debt. Pretend money has been used to make finance out of other pretend money. Powerful oligarchies have swallowed up other oligarchies as did corporations. Hedge funds and Investment Groups became ever bigger than banks and entire national economies. Corporate executives replaced shareholders as controllers of corporations and saw their interests as the main ones. Everything began to float on phantom money and capital. No one knew what was ‘real value’ any more. Greed, waste ,excess and a culture of the appertitive dominated everything and still does.
The pyramid structure of advancing Capitalism has been replaced by an inverted pyramid that is ready to collapse.It is the opposite of what is depicted in Bruegel’s painting of the ‘Tower of Babel’. Taxpayer money was used to save capitalism, but this isn’t enough finance to save the Capitalist structure, and little has changed except that a few rivals have disappeared. The injection of taxpayers finances to prop up capitalism can only stimulate the economies temporally and will need inhuman cuts to social programs with each of their infrastructures. This will force the financial crisis onto the backs of all working people is a form of Capitalist blackmail of the public sector .The amount world wide of this bailout and black mail is a staggering $50 trillion dollars that has been obtained by cutting social infrastructure and the peoples quality of life. Most major US banks could go bankrupt in the next seven years (420 are now in doubt). All debts have increased and the debt crisis has not been solved nor problems of toxic assets and their still there. Total financial losses in housing are now $4 trillion and $9 trillion in share markets. This crisis could move into commercial real estate in the near future. About one third of US debt comes from foreign investors in the US, if they decide to take back their own finances, then the US economy will fall apart. No one knows when this could happen on the future calendar .All insiders are very nervous. The system of Capitalist accumulation is totally breaking down. Military conflict and use of war is a kind of trade war conducted by other means, which was and remains a barbaric method that can be used to destroy other nations capital base so that a false regeneration can take place. At present, the Capitalist world economy was and remains like a pack of cards ruled by a ship of fools, and it could be destined to fall in a mighty mess in the near future and could tempt vast, cross nation military conflicts of rival Imperiums as has happen before to capitalist economies in crisis. The aim of this would be to destroy and force open new markets and restart the paradoxical engines of Capitalism all over again.
There are also new factors in operation such as wide spread inequality of distribution of wealth in countries such as the US. Today 1% of the population control over 40% of the wealth. This is bad as it was in 1917. This will lead to large scale alienation within the society of the US which will in turn influence is future culture.
No country should follow the US down that dangerous path to initiate a war regime change (with nuclear weapons) as it will not solve the essential problems of Capitalism. The world has changed since 1914. Basically, Capitalism and its Nation/Sate in trendy language has by-passed its historic use- by -date! It needs a flexible hybrid green/socialist, mixed model to replace it.
