As the most recent global capitalist meltdown extends into its 4th calendar year, it would appear that the progress of slow-motion economic destruction – visible most readily and recently in the ongoing crisis of the Eurozone – is nowhere close to reaching its terminal point. While neoliberal policy elites have heroically acted to nullify democracy in the hottest flashpoints of southern Europe, replacing nominally elected officials with bank-friendly technocrats in key positions so as not to unduly upset sovereign bond markets, these actions have arguably only ‘kicked the can down the road,’ so to speak. In the cases of Greece and Italy, Merkel, Sarkozy, Trichet, and friends have, simply by fiat, installed reliable apostles of austerity in supposedly elected offices. This effectively shields the crafting of ‘sound monetary policy’ in these countries from any dangerous exposure to democratic, popular control, but it will also, arguably, exacerbate the underlying conditions of the crisis. At least in the case of Greece, it seems clear that these stop-gap measures of austerity essentially relegate the target country – whose economy is already under enormous stress and subject to a potential speculative attack at any time – to a deepening spiral of rising unemployment, decaying demand and capital investment, and of course a massive sell-off of public resources to private concerns. In order to avoid a potentially devastating default, which entails huge losses to rich creditors and is therefore unacceptable, the so-called ‘Troika’ of the Eurozone – the IMF, the European Central Bank, and the European Commission – is forced to merely dig a deeper grave, it would seem, for the ideal of European unity.
It is precisely this forced choice between two overtly destructive alternatives that confronts policy-makers at the highest levels of political and economic power during historical crisis-cycles. While most commentators on economic and political policy tend to judge the progress and outcome of such cycles on the basis of the talents and knowledge of the individual elites overseeing them, Marx was interested in a method that could begin to explain why policy-makers are confronted with these disastrous situations in the first place, and thus was led to theorize the deep processes of capital accumulation and its attendant, sub rosa contradictions. In the chapter on money and commodity circulation in Capital, Marx begins to theorize how the monetary crisis, as a specific element of a general commercial or economic crisis, is determined by the contradictory aspects taken on by money as a means of payment in a financially advanced capitalist economy. “There is a contradiction,” he suggests
immanent in the function of money as the means of payment. When the payments balance each other, money functions only nominally…as a measure of value. But when actual payments have to be made, money does not come onto the scene as a circulating medium, in its merely transient form of an intermediary in the social metabolism, but as the individual incarnation of social labor, the independent presence of exchange-value, the universal commodity. This contradiction bursts forth in that aspect of an industrial and commercial crisis which is known as a monetary crisis…Whenever there is a general disturbance of the [financial] mechanism, no matter what its cause, money suddenly and immediately changes over from its merely nominal shape…into hard cash. Profane commodities can no longer replace it. The use-value of commodities becomes valueless…The bourgeois, drunk with prosperity…has just declared that money is a purely imaginary creation…But now the opposite cry resounds over the markets of the world: only money is a commodity…In a crisis, the antithesis between commodities and their value-form, money, is raised to the level of an absolute contradiction (Capital, Penguin Classics edition, 235-236).
The ‘ontological’ status, if you like, of money shifts as the totality in which it moves and is embedded undergoes change. In a given temporal and geographical context, such as, let’s say, the Eurozone up until roughly late 2008, money “functioned nominally;” that is, the entry of Greece into the monetary union provided that country with a veritable flood of cheap bank credit, which generated debt-financed, consumption-driven growth and simultaneously served to energize the productive export economies of the European north (read: Germany). Money, here, was taken by economic actors to function nominally as a “measure of value;” where the putative source of that value lied was truly beside the point, as long as the Euro bubble kept growing alongside soaring profit margins for all interested parties. As we now know, the always illustrious and civic-minded Goldman Sachs had a key role to play in the duplicitous hiding of Greek debt during its transition period into the Eurozone.
This delusional state was removed by force with the meltdown and ensuing global slump of 2008. Greek political leaders, like others at the time, decided to ‘bail out’ Greek banks, which were of course paralyzed by the global credit freeze then tightening its grip on all the advanced capitalist democracies, thus tremendously augmenting the country’s already considerable public debt. This, combined with an astonishingly quick rise in unemployment and equally rapid decrease in GDP, fairly quickly alerted holders of Greek sovereign debt to the dubious status of their assets, and so began the cycle of crisis that has metastasized into the general crisis of the Eurozone that is now unfolding before us.
Returning to Marx one could, if preferred, perhaps identify the roughly 3 month period of October through December 2008 as the period wherein money, formerly a nominal, circulating medium or measure of value for its holders, transformed into a real container of social labor for them, that is, it itself took on the appearance of real, tangible value. Hence the vehemence with which the Eurozone power-elite insists upon forced, perhaps even permanent, austerity. What better evidence of the ‘metamorphosis’ of the money form, as described above, then the obsessive fantasy that harsh austerity for Greece’s embattled productive economy will somehow ameliorate the general crisis? In such times, wherein untold amounts of value have seemingly vaporized into thin air, capitalists search for and fasten upon – fetishize? – anything that seems remotely plausible as a source of value-creation. It of course goes without saying that the citizens of Greece figure nowhere in this picture, except as an aggregate of homo economicus, a potential source of wealth-extraction.*
The stubborn insistence of EU policy makers on seemingly counter-productive, even destructive, austerity policies strikes many as irrational and even vicious, and rightly so because it certainly is that. But according to Marx’s critical theory, to leave it at this would be in part a kind of misrecognition. This is because it abrogates an understanding of how the system of social relationships itself works not just to constrain the available range of possible choices, but also to impart values to them, to construct a horizon of meaning in which such geopolitical actions, far from irrational, represent in fact the very apex of rationality for the revolving-door coterie of people like Trichet, Papademos, and Draghi.
Loathsome and morally debased though they may be, it would be significantly mistaken to see the decisions of such people as the result of character flaws, or even as a result of basic class-interest (though of course this often is indeed an accurate predictor). Arguments focusing on individual attitudes or “character” are subject to all the historical limits of bourgeois thought. Instead Marx, as well as the tradition of critical social theory generally, aims at an analysis oriented by the idea of social and historical process, one that does not shirk the role of human agency and the significance of individuality as a key aspect of modernity, but that also does not fetishize them. As Marx and the critical left has understood for quite some time, seeing the world in historical motion is a step in a radical direction when social domination is so reliant upon an experience of time and space that empties these of their historical content, when it is deeply dependent on the successful inculcation of a sense of the static, eternal ‘now,’ or what Max Weber referred to as that complex of factors composing the ‘Iron Cage’ of modernity. This constitutes a method and a practical attitude, an orientation for collective action, one might say. And though it seems rather bleak at the moment, the development of the class struggles in Greece may hinge upon whether or not the hitherto fragmented and co-opted Greek left is able to consolidate itself under a unified banner, articulate itself as a hegemonic bloc and re-activate the sense of Greek citizens that they, as a collective agency and as they’ve done in the past, could act to intervene in historical processes and shape their own future.
* For data informing this section, see Stathis Kouvelakis, “The Greek Cauldron,” New Left Review 72.