Thursday, January 5, 2023

Clara E. Mattei's "The Capital Order"

Clara E. Mattei is assistant professor of economics at the New School for Social Research in New York City.

She applied the "Page 99 Test" to her new book, The Capital Order: How Economists Invented Austerity and Paved the Way to Fascism, and reported the following:
Page 99 is at the end of chapter 3, “The struggle for economic democracy.”

Following the economic interventions of their governments during World War I, the working classes of Britain and Italy were uninterested in a smooth reintroduction of capitalism. By 1919 the old system was in full-blown crisis, and its component parts— workers, union leaders, and economic experts— were all announcing the end of the old order. Post-capitalism, whatever its form, was on its way.

What was the basis for this conviction, which was mirrored by a sense of apocalyptic panic among the bourgeois establishment? Capitalism was strongly contested at its very core.

In these pages we have shown how political imagination toward the abolition of private property and wage relations moved from abstraction to reality. In the first place, the soaring “strikomania” of the British and Italian workers was political: it demanded new relations of production.

These demands took the form of the struggle for workers’ control that peaked in 1919– 1920 with the objective of self-government to secure the emancipation of the majority.

Certainly, the direct action of politicized workers was proving to be a far more serious enemy to capitalism than the reconstructionist project that the reader encountered in chapter 2. Indeed, the miners, the building guilds, and the cooperatives directly attacked production for profit, wage relations, and private ownership of the means of production. However, the struggles we have encountered here share with the reconstructionists a faith in state aid to defeat the old order through constitutional means. To complete the sketch of capitalism in crisis we must still address its gravest enemy.

Chapter 4 explores the movement for industrial councils that emerged in the Clydeside region of Britain and reached its peak in Turin, Italy. The efforts of these rank-and-file workers took on a clear-cut revolutionary form in opposition to both capital accumulation and the state— and pushed capitalism to the brink. In this space, a class of experts found their most useful tool: a new rationale for austerity, one that became the narrative of the threatened and powerful.
The Page 99 Test is spot on in allowing a browser to get a good sense of the content of the first part of The Capital Order. It provides a bird’s-eye view of the diverse spectrum of alternatives to capitalism that were emerging after the shock of WWI, which had shaken the pillars of western capitalist societies, especially private property of the means of production and wage relations. Part I of The Capital Order stands on its own feet. Rather than looking at the years 1919-1920 with the benefit of hindsight and thus portraying them as “weak” in their attempts to dethrone the status quo, my effort is to give voice to the spirit of the time. Indeed, by focusing on the deep interconnection between theoretical and practical alternatives to organizing production and distribution that emerged a century ago, the reader may broaden her imagination as to how to confront the deep challenges that our capitalist societies face today. Of course, this first part of the book serves the important purpose of setting the stage for the story of part II, namely the austerity reaction that captured Europe starting from the 1920s. The main thesis of The Capital Order is that the logic of austerity today can be grasped if one looks at the moment of its origin. Rather than being a stupid economic theory, austerity is a powerful disciplinary project that “tames” citizens and re-asserts capitalism as the only game in town. Cuts in the social budget, regressive taxation, interest rate hikes, privatizations, and labor deregulation (all components of what I call the austerity trinity) shift resources from the many to the few and increase our precarious conditions of market dependence. Such one-sided class warfare, which is fought also at the cost of an economic recession, serves the structural benefit of forcing the large majority to accept our condition as low-paid wage workers. The protagonists of this story are the economic experts who collaborated with Benito Mussolini and those who led the British Treasury. Both sets of technocrats devised theories that suppress workers’ agency and have lured us into internalizing a false sense of meritocracy by which if we are poor we deserve it.
Follow Clara E. Mattei on Twitter.

--Marshal Zeringue