Category Archives: capital

What does School Privatization Have to Do With the Crisis?

Following the Chicago teacher strike over the Democratic Party’s push to privatizae public schools, with the “Race to the Top” initiative, I was reminded of a couple texts about the relationship between the current crisis and the thrust towards the privatization of the public sector, with the latter becoming an increasingly important site for the profitable investment of over-accumulated capital.

Reclamations, a journal that emerged out of the California student demonstrations of 2009, has been producing very interesting material relating the crisis to the university. They argue that by the late 1990s, “the leading edge of restructuring [centered around “privatization, neoliberalization, financialization and commercialization”] shifted from the university’s rationalization to its integration as a site of accumulation and investment in the circulatory system of capital.” (emphasis added) (Whitener/Nemser, ;”Circulation and the New University”, 06.08.12)

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Occupy’s relationship to capitalism

In a recent interview in the Frankfurter Allgemeine Zeitung, Mark Greif, participant in the New York City Occupy movement, editor of the magazine n+1, and literatur professor at The New School, commented about the movement’s view of capitalism:

The central figures of the movement want a radical transformation [of society]. For them, capitalism is the enemy. They want, like the sociologist [sic] David Graeber who established the “99 percent” statement, a non-violent anarchism. There is also the group of part-time protesters, for whom they, like myself, come on particular days, after work for example. They have a completely different attitude. I saw a woman speaking to the business people in front of the stock exchange: “I am not against capitalism,” she said. “I believe in the idea of hard work, but I have so much healthcare debt, that it doesn’t matter how much I work, I will never be able to pay it back.” For her, capitalism is not the problem. On the contrary — she wants to be part of the system. The problem is a kind of capitalism that makes it impossible for those people who play by its rules to lead an orderly middle-class existence.”

While Greif is right to identify this distinction within Occupy, the movement’s initial success rested on its capacity to turn this question around. Instead of answering on ideological grounds about its desired social, political or economic alternative to capitalism, it challenged U.S. capitalism to face its own failures.

Slavoj Zizek demonstrated this from atop a soap box in Zuccotti Park when he said: “They tell you we are dreamers [ie. that we are ideological or utopian]. The true dreamers are those who think things can go on indefinitely the way they are. We are not dreamers. We are the awakening from a dream that is turning into a nightmare.”

It doesn’t seem to me that the initial success of the Occupy movement rested on its opposition to capitalism on the ideological level. Rather, it challenged neoliberal capitalism to face up to the material reality it had created, hence the thousands of testimonies on the wearethe99percent.tumblr.com blog attesting to the material deprivations caused by three decades of neoliberal restructuring, the current crisis and recession: lack of access to healthcare, homelessness, overwork, unemployment, insurmountable debt, skipped meals, exploitation, and so forth. The apparent political difference between the anarchists (or socialists or communists for that matter) on the one hand, and those who supposedly “just want to be part of the system” on the other hand, is not significant. All are “waking up on the wrong side of capitalism.”

What drives the movement forward is its most simple demand, that the societal configuration ought to respond to the material needs of the population, and not the other way around. (What some refer to as “economic democracy”, in the widest sense of the term). The question the movement implicitly poses through its actions, is whether the current configuration is up to that task or not.

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Reclamations Journal: Circulation and the New University

During the 1990s, a rationalization of the workplace in American universities occurred, a process that critics described with terms like privatization, neoliberalization, financialization, and commericalization. By the late 1990s, however, the leading edge of this restructuring shifted from the university’s rationalization to its integration as a site of accumulation and investment in the circulatory system of capital. Notably, however, our discourse hasn’t changed, and today we continue to talk as if all that was happening in the university was the same process of rationalization. This is not to say that words like neoliberalization or privatization have nothing to tell us, but rather that, because the majority of gains were received from these changes by the end of the 90s, these words no longer capture the leading edge of change in universities today. [….] What we want to do here is to briefly outline the new insertion of the university into the reproductive circuits of capitalism.

The university is no longer primarily a site of production (of a national labor force or national culture) as it was in the 1970s and 80s, but has become primarily a site of capital investment and accumulation.

There are two key mechanisms through which the university has been coupled into circulation—or, to be technical, coupled into the circulation of both productive capital and money capital. The first is the cycle of wealth transfer that moves federal dollars directly into corporate and bank coffers. [….]

The second mechanism, the emergence in the post-crisis context of capital over-accumulation—that is, a surplus of capital with no profitable investment outlet—has helped to transform universities into privileged sites of capital investment. Due to market conditions and credit availability, universities have been able to increase tuition without limit (for example, at the University of Michigan, tuition has gone up 297% since 1990), which in turn has driven up their credit ratings and made borrowing cheap for them.[6] As a result, banks, hedge funds, and institutional investors have begun investing heavily in and through universities, buying up construction and other bonds as well as student loans. In this way, some of the money that once was put into the faltering credit and mortgage markets has found a new home in the student loan and secondary student loan markets.

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David Harvey: Middle Path Between Autonomism and Statism

Here is a selection from David Harvey on the shortcomings of autonomist and statist approaches, and his view of a “middle path” that could work as an “antidote to the power of capital”. (“The Urban Roots of the Financial Crises: Reclaiming the City for the Anti-Capitalist Struggle” in SOCIALIST REGISTER 2012): Continue reading

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