The eminent economist says neoliberalism creates corporate monopolies and weakens workers, setting the stage for fascist takeover.The market economy tempered by social ethics, as advocated by economists like Adam Smith, Alfred Marshall, John Maynard Keynes, Amartya Sen and many others, has not only been replaced by “asocial neoliberalism” but also, in the current phase, by mighty oligarchic duopolies controlled by politicians and their prevailing favourites. The Trump-Musk and Modi-Adani duets are the most flagrant examples of the pervasive political-economic bonhomie at work. Is this development opposed to welfare capitalism in principle and practice? The eminent economist Prabhat Patnaik, former professor at JNU and political commentator, answers the question while tracing the crucial passage from free trade to plutocracy.If we confine ourselves to the capitalist world of South Korea and Japan, the Scandinavian countries, and West Europe, why do we not see such intimate alliances in these countries? Is it because the economies of these countries are gegliedert, to use the German expression, which means structured at three layers—large corporates, middle concerns, and small initiatives which interact with one another in the market economy?A very close relation between the government and monopoly capital is a feature of all countries in the era of monopoly capitalism, and it was a feature also of Japan with its Zaibatsu [group of capitalist enterprises] and South Korea with its Chaebols [large, usually family-owned, conglomerates]. Within this relationship, however, when there is ascendancy of fascism, not only does an alliance develop between the fascists and monopoly capital but a particularly close relationship develops between a new segment of monopoly capital and the fascist rulers; this had happened in pre-war Japan when Japanese military fascism was hand in glove with a new segment of the Zaibatsu, the “Shinko Zaibatsu”.It is, therefore, a matter not of country characteristics but of the ascendancy of neo-fascism. Of course, countries impose their specific imprints on the character of the neo-fascism that emerges there. Besides, whether neo-fascism acquires power at all in a country depends upon the particular class configuration within that country, but class configurations do change over time. So, I would not bet on Japan or South Korea not witnessing the emergence of crony capitalism reminiscent of what we have
In this context, I am reminded of a conversation I had with a top Siemens executive in Berlin some years ago. He accused former German Chancellor Willy Brandt of being positively “anti-business”. Brandt, we know, was miles away from the present-day Social Democrats. Yet another memorable Social Democrat, Brandt’s admirer Günter Grass, remained an acerbic critic of neoliberal globalisation all through. How would they have reacted to the two alliances I referred to right at the start? Neither Grass nor Brandt was a communist, and they lived in a capitalist society.The Siemens executive calling Brandt anti-business does not surprise me. Monopoly capital expects the government to exclusively promote its own interest, passing it off as the “national interest”, and if a politician does not fall in line, then he is called “anti-business”. Under neo-fascism he would even be called “anti-national”. Brandt certainly (and possibly Grass too) would have opposed the close nexus that develops between one or two “new” monopoly houses and the government, as it occurs under neo-fascism, but I imagine he would have worked hard to prevent a neo-fascist government from coming to power at all, by forming a broad coalition of the Left, as happened recently in France.
What can the INDIA bloc possibly do with the likes of a powerful industrialists such as Adani if at all it does come to power? After all, it cannot transform the system lock, stock, and barrel, can it?It can institute a proper inquiry into the various charges levelled against the Adani Group, which has been protected until now by the government, then take action on the basis of the findings. But if the INDIA bloc comes to power, then its agenda will have to be much more comprehensive than simply going after the Adanis. It will have to introduce a wealth tax and an inheritance tax on the richest sections of the population.According to my calculations, a 2 per cent wealth tax and a one-third inheritance tax imposed on just the richest 1 per cent of the population will enable the country to finance five new universal and justiciable fundamental economic rights, which would be the crux of a welfare state. Advanced capitalist countries have much higher inheritance tax rates (Japan, for instance, has 55 per cent and the US and the UK 40 per cent).Likewise, a 2 per cent wealth tax imposed only on the wealthiest 1 per cent of the population is much lower than what Bernie Sanders and Elizabeth Warren proposed in their programmes during the 2020 US presidential election.Elon Musk’s taking part in discussions with Ukrainian President Volodymyr Zelenskyy or the accounts of the Indian I-T department reportedly swooping on entrepreneurs to coerce them to withdraw tenders so that the contracts can go to one top business house have, I think, given a new and alarming dimension to neoliberalism. Do you think it should be described by the expression “repressive duopoly”? The term neoliberal sounds too timid.All these are symptoms of neo-fascism, and the conditions for neo-fascism are created by neoliberalism itself. Neoliberalism does so in two ways: first, by weakening the working class through increasing unemployment (a fallout of a higher rate of technological change because of greater competition owing to trade liberalisation and also of the decimation of the petty production sector) and through the privatisation of public sector enterprises. The working class is too enfeebled to resist the rise of fascism.Secondly, the crisis of overproduction in a neoliberal economy caused by growing inequality threatens the hegemony of monopoly capital, which therefore makes an alliance with neo-fascists to change the discourse away from issues of material life towards “othering” a hapless minority. So, as long as we distinguish between neoliberalism and neo-fascism and are clear about their interrelationship, using the term neoliberalism should not matter.
Regarding the indictment of Adani by the Department of Justice in a New York court and the raids conducted by the FBI on the premises of his nephew Sagar Adani, how far is malpractice allowed to be an integral constituent of “crony” capitalism? And, of all people, Joe Biden, in his farewell address, warned against the domination of the “oligarchy of the ultra-wealthy”. Biden is not even a pale Social Democrat!Public opinion in America has always favoured “competition”, which is reflected in several [pieces of] legislation and judicial pronouncements. At the same time, the inexorable logic of capitalism has been towards centralisation of capital and the formation of monopolies out of “free competition”. Monopoly capitalism necessarily entails “crony capitalism” (which, of course, reaches its apogee under neo-fascism). It is this contradiction between the “moralism” of public opinion that spills over into sections of the judiciary and the reality of capitalism which inevitably produces “cronyism” that occasionally expresses itself in judicial pronouncements in the US, such as in the Adani case.The Adani case, I believe, is not just a morally abhorrent special case in an otherwise blameless capitalism; it is an example, though perhaps an extreme example, of what happens under neoliberalism which allows the unfettered rule of monopoly capital, and especially under neo-fascism for which neoliberalism prepares the ground. Therefore, I would rather not attach much importance to Biden’s warning. Preventing such cases is possible only by changing the economic order and ushering in one that transcends neoliberalism.A spate of rejections and second thoughts has followed the indictment. The Kenyan government has cancelled its deals with the Adani Group; the Bangladesh interim government is reviewing its contract; TotalEnergies, the French energy giant, has said it is going to halt investments until the accusation is proved wrong; and the Sri Lankan government has revoked a power purchase agreement. Do these actions indicate that market forces are opposed to murky crony capitalism?These reactions should not mislead us into thinking that “market forces” under monopoly capitalism can somehow bring in “clean capitalism”. Even if the Adani empire collapses, some other empire will come up as an expression of crony capitalism as long as neoliberalism, and its ultimate denouement, that is neo-fascism, lasts.To say this is not to suggest that crony capitalism that violates the professed rules of the game of capitalism itself should be tolerated. It is to recognise the fact that crony capitalism, even in its most brazen form, cannot be overcome as long as we have not transcended monopoly capitalism and the current manifestation of its hegemony in the form of the neoliberal regime.Subhoranjan Dasgupta, former Professor of the Human Sciences, has authored several books in English and Bengali. He is based in Kolkata and contributes regularly to newspapers, magazines, and academic journals.
Neoliberalism creates conditions for neo-fascism: Prabhat Patnaik
https://frontline.thehindu.com/economy/prabhat-patnaik-economist-interview-indian-economy-neoliberalism-monopoly-crony-capitalism-neofascism/article69153958.ece
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