“State loans, the creation of the ever increasing, gigantic public debt, is one of the keystones of capitalist accumulation. Marx, in Book One of Capital (chap. XXVI, 8, on the genesis of the industrial capitalist), states: ‘National debts, i.e., the alienation of the state – whether despotic, constitutional or republican – marked with its stamp the capitalistic era. The only part of the so-called national wealth that actually enters into the collective possessions of modern peoples is—their national debt. Hence, as a necessary consequence, the modern doctrine that a nation becomes the richer the more deeply it is in debt. Public credit becomes the credo of capital. And with the rise of national debt-making, want of faith in the national debts takes the place of the blasphemy against the Holy Ghost, which may not be forgiven’”.
These few sentences of Marx’s (quoted in “America”, one of our own texts written in 1947) (1) give a very brief summary view of the general terms of the public debt issue and allow us to read current events free from the sea of prejudices that affect any interpretation not based on revolutionary Marxism. The prejudices can be summed up precisely in what Marx defined as “the blasphemy against the Holy Spirit”: in other words, that the debt be the fruit of guilt (terms which, moreover, are equivalent in German). State financing through the debt carries out praiseworthy work, as long as it guarantees safe returns to a capital otherwise unproductive, but suddenly becomes the object of public reprimand when it sways under the weight of its own gigantism. In the latter case, it is pointed to as the fruit of guilt, of bad administration, of waste, if not, indeed, as the prime cause of all the ills that afflict the otherwise flourishing society of capital. The public debt becomes a parasite that is called to account. As an effect of the upturning of reality which is characteristic of our demented modern economy, the creditor – in other words financial capital – takes care not to demand that the parasite be uprooted, but demands greater returns from it as compensation for the loss in security. In this way it reveals, to the eyes of those who know where to look, who is really the ultimate parasite in this relationship between parasite organisms: financial capital, even without taking into account the salvage operations by the Central Banks which in recent times have saved it from bankruptcy and have weighed so heavily on the debts of nation States.
Yet the responsibility is of the much-maligned State (Capital, in fact, is not guilty of being… itself!), which for its part confesses to have been a little too munificent, to have, in its turn, nurtured a vast population of parasites; but in the end the people who will have to pay will be those who are said to have benefited most from this munificence: the employees and the pensioners who have … wallowed in the midst of social buffers and the care offered by public services.
“One of the essential theses of Marxism is that the more wealth is concentrated in the hands of the national bourgeoisie, the more poverty there is in the working-class masses. The Cop-State, which simply defends the privileges of the former, is increasingly transformed today into the Cashbox-State. The profits from this cashbox go towards incrementing the accumulated wealth of the bourgeoisie, whilst its debts weigh on the general public, or the workers. Through national debts the economic slavery of the proletariat is confirmed. Moreover, with the senseless claim that the latter should even put its signature to some of its exploiters’ credit bonds, its slavery is confirmed a third time over” (2).
By means of the public debt, today as yesterday, Capital calls to account the Servant-State, which promptly takes steps to activate the tax system in order to depredate the proletariat more intensively, causing growing masses of the petit-bourgeois and middle classes to precipitate into its ranks, including entrepreneurs, ruined as much by taxes as by the crisis. The patriotic objective of the present thus becomes the balancing of accounts, which, in a situation of economic stagnation, means including in the agenda the dismantling of what remains of the social services. In fact, like any glorious aim, the balancing of accounts, too, requires its necessary sacrifices and inevitable victims, who, if they do not figure in the lists of the Fallen for their Country, will fill up a few square centimetres of print or a minute or two on TV. Thus, the concentration of wealth in the hands of the “financial aristocracy” is confirmed as an essential function of the public debt.
In the “financial aristocracy” Marx includes “not merely the great loan promoters and speculators in public funds, in regard to whom it is immediately obvious that their interests coincide with the interests of the state power. All modern finance, the whole of the banking business, is interwoven in the closest fashion with public credit. A part of their business capital is necessarily invested and put out at interest in quickly convertible public funds. Their deposits, the capital placed at their disposal and distributed by them among merchants and industrialists, are partly derived from the dividends of holders of government securities” (3).
This is thus a phenomenon that has been an intimate part of capitalism’s nature since its origins, impossible to eradicate as long as capitalism lasts.
Parallel to this process of concentration of financial wealth, the opposite process is going on – something equally part of the nature of capitalist development – as increasingly large sectors of society are depredated and impoverished, which is the reason for Capital’s ever more urgent need to rely on the solidarity of the State as an organism of class domination, the Cop-State: “If in every epoch the stability of the state power signified Moses and the prophets to the entire money market and to the priests of this money market, why not all the more so today, when every deluge threatens to sweep away the old states, and the old state debts with them? Words that appear to have been written today but that once again date back to Marx, 1851 (4).
Today, like yesterday, there is always trouble when the spread of disorder threatens the agreeable business of the “financial aristocracy”, which asks nothing more than to make its money peacefully and undisturbed and is thus always on the lookout for “sentinels of order”, in particular at times of crisis: “this is proved by the sensitiveness of the public funds at the least prospect of disturbance, and their firmness the instant it is made manifest that the executive is victorious". Here is another dogma of the modern economic Word which we could find in the pages of a hundred modern publications, from the ItalianSole-24 Ore to the Economist: and which we copied precisely from the Economist – but its 1st February 1851 edition! (5)
A social pact, by Jove, otherwise Capital will go elsewhere! Bend your backs, wage-earners, or the spread will increase! For over 160 years Capital’s admonishments have regularly been the same and will remain so until its end.
***
The question of the sovereign debts does not regard exclusively the domestic situation of capitalist countries but, today, more than ever, the relationship with international Capital.
We quote once again from our text, “America”:
“In Italy it is certainly not De Gasperi who risks sinning against the Holy Spirit! But his present opponents in Parliament, his partners up until yesterday in the policy of loans, his partners again today in the policy of the servility of the workers’ unions, remain partners in the policy of loans from America by which the Italian State alienates itself to foreign capital. We have already stated that, for the proletariat, whether it is sold to foreign or domestic capital, the misadventure is the same. In the case of the present political class in Italy, however, it should be remembered that, through the disgraceful metamorphosis their positions have gone through, they will have taken another step downwards by selling the honour of their State. Alienation from one’s own honour is not the worst conclusion to be expected. Here again, and we are still reasoning fully in terms of the mechanics of the bourgeois world, which we oppose and abhor, there is a question of price. Honour can be sold at below cost price. And this is what today’s Italian political hierarchy will come to, by negotiating the conditions of its financial intervention with the foreign Victor, their only preoccupation being to contend the percentages of commission on the deal, whether they be pro-American or pro-Russian.”
In this extract, reference is made to the conditions laid down by the capitalism emerging victorious from the last imperial war for the concession of financing to the losers: political subordination and intensification of the exploitation of the proletariat. The subjection of the nation State to Capital, which yesterday could be identified mainly with American capital and today with world capital, which nonetheless maintains its main overseas centres, in any capitalist age involves the proletariat being sold at the lowest possible price. The ruling Italian political classes, today’s as yesterday’s, with the same “disgraceful metamorphosis of their positions”, align themselves in support of the policy of sacrifices, by which they can hope that their earnest work is appreciated in that sort of financial law court constituted by the rating agencies.
In the meantime, “in selling the honour of their State” they have taken several steps downwards towards the abandonment of any independence of politics, on the one hand from the interests of finance, and on the other from the diktat of the strongest foreign capitalism. If the present-day diktats of US capitalism pass through the claims of the financial markets, those of German capitalism, which has perked up in the meantime, pass through the obligations deriving from their membership of the prestigious Euro zone.
***
In the present phase, the capitalist crisis, whose effects run deep, into its very mechanisms of accumulation, and which is reflected first and foremost in the credit system, obliging the central banks to intervene with considerable financing, exhibits, as one of its surface effects, the difficulty of some European States to place their own debt securities. As a consequence there comes a consequent reduction in their prices and increase in the interest to be paid when they are due. As is well known, this plague affects the Euro zone in particular, where the States do not dispose of any independent monetary policy and thus cannot intervene on the market of their own titles, for example buying them back again, as the Fed did, or supplying unlimited liquid assets to their banks, so that they can do this for them. International speculation – a term in use when it was considered impolite to reveal the work of the banks themselves – thus manages to manoeuvre bargains on the debts of some States through waves of selling and subsequent repurchasing at favourable prices, or else on the CDS, in other words those special financial tools that should protect creditors from the risk of their debtors going bankrupt. The result is that the cost of financing the public debt in some States – considered less trustworthy – swells to beyond a level of tolerance, in others it drops to zero by virtue of a presumed state of economic “health”. The result of these imbalances is an increase in the lack of balance itself (those who are better off finance themselves, those who are worse off pay through the nose for their loans), since it is natural, in the jungle of Capital, for the strongest to act the boss, and thus, at all levels, situations like the one in the fable of the wolf and the lamb are generated. Germany, the wolf this time, self-finances at 0% credit, so much so that she can afford to grant 5% rises to civil servants and preaches the need for sacrifice to the Greek lamb, which is already nearing starvation point. In Greece, Spain, Italy, etc. there is certainly no talk of wage rises but of authentic bleeding operations, draconian measures that affect the living conditions of millions of proletarians and half classes in order to face the cost of financing the State.
This, broadly speaking, is the framework within which protest and indignation, without even the faintest glimmer of the class war flaring up again, take their place. While the proletariat as yet fails to express any spontaneous defensive reaction to the crisis, which nonetheless hits their living conditions so hard, in the complete absence of any initiative by the union corporations, we see a proliferation of movements and associations promoting the most diverse of initiatives, self-dubbed “radical” or even “revolutionary”, claiming to voice the “people’s” protest, a “people” whose democratic majesty is offended by a clique of avid speculators backed up by those who govern for them. Witty fellows of all descriptions preach that the respective governments should withdraw from the blackmail of the so-called “markets”, refusing to give in to the threats, which go something like this: “Put your State accounts back in order, make cuts, and layoffs, tax and wield the stick or with your treasury bonds, titles, etc. you can proceed to operations that are not precisely… financial.” Meanwhile, the public securities are indeed sold, but at bargain prices and with peak returns… In support of the aim “not to pay the debt” – which according to them is a reasonable and sensible move – the demagogues quote the example of semi-frozen Iceland, where a referendum authorized the government not to honour its commitments towards international creditors – neglecting the small detail that the country’s resident population is equivalent to more or less that of a medium-sized Italian province and that the northern banks are featherweights in the international finance system.
Thus the path of the struggle has been mapped out by the heroic people of Iceland: it will be waged by referendum. What is surprising in all this protesting is certainly not the sacred repulsion for banks and servile governments but, on the one hand, the completely superficial approach to the problem (as though the question could be isolated from the general context, laden as it is with implications), and, on the other hand, the claim that it will be a “democratic revolution” that will reverse the direction of the present political path: “This debt must not be paid and the costs of this crisis must be assumed by those who caused it… From Greece, where the word democracy was invented, should come a democratic reaction by all the peoples of Europe” (6). It is hard to say if those who shoot their mouths off like this are serious or just pretending; the fact remains that the general illusion is spread that a protest movement, however big it is, that respects the rules of democracy, just because it demonstrates “indignation”, is capable of overturning consolidated power relations that see big industrial-financial capital comfortably manoeuvring to its own advantage with the decisive contribution of the democratic State, while the proletariat suffers the initiatives of its class enemy helplessly for the moment. We obviously do not expect figures, who can only be passed off as “extreme left” in talk shows, to be able to deal with Marxist categories. But these people are living on another planet. To follow these Pied Pipers, at times lent to politics by cabaret, means losing oneself in a void. They cling to the idea of suspended democracy: democracy, this essential and imperishable good belonging to free peoples, is said to have been suspended dramatically in Genoa in 2001, when the truncheons beat down on the heads of defenceless kids (defenceless, because unaware of the true hidden nature of the democratic State!), and is said to have been suspended today because the “governments of experts” in Italy and Greece did not take up office by appointment in political elections but were imposed from outside by “superior powers”. In fact, they were democratically voted, though with some bleating and a few reserves, by the most strongly represented parties in Parliament: in Italy, to the unanimous satisfaction of the prim and proper at the replacement of a rather embarrassing figure by a distinguished gentleman with good manners (so good indeed as to exhibit, as a sign of merit, the comparison of the number of suicides in his own State to that in the black-sheep State!); in Greece, to the absolute indifference of the MPs to what was going on outside the building, to the helpless anger of the young, the unemployed, pensioners, all sentenced to misery.
To listen to the supporters of the “No-debt” – let’s call them this for simplicity’s sake – this social disaster originated from a clique of politicians at the service of international financial groups. Once the clique has been sent home and Sacred Democracy has been re-established, Free Peoples will be able to make their will felt in policies that are finally made to serve common mortals. The No-debt supporters, too, are victims of the guilt prejudice, guilt to be attributed to someone, to a parasitic fraction of capital, a government, an international plot (today there is talk of the Trilateral; yesterday of finance … Jewish finance). What rubbish! The public debt is, we repeat, in the very nature of capitalism. When the experts go home, not before they have diligently completed their tasks, other figures will appear (the market has a fine bestiary of them!), who will tell a new little story, suited to the new circumstances, and once again they will practise the art of democratic deceit of the proletariat struggling with even greater difficulties than today’s but well fed with illusions. And it is not unlikely that amongst the candidates to manoeuvre the old ship of State there may be some of today’s “debt rebels”! That is: unless growing frustration and anger find ways of showing themselves in forms that are at long last classist and thus open to a more aware vision of what is at stake – not democracy, but the conservation or not of dominion by capital.
There has never been any “suspension of democracy”, because truncheons and experts in social butchery – for those who can interpret them – simply reveal the class nature of the democratic State, a nature that decades of counter-revolution have clumsily concealed behind the benevolent mask of welfare. Nor is this butchery, which justifies itself with the need to finance the interests on the public debt, the simple result of a political will or even of international “plots”, but of the worsening contradictions in which the capitalist system is struggling and which require “saviours of the mother country” and “sentinels of order”: today in the disguise of experts, yesterday of leaders of the people like Louis Napoléon. All democracies democratically envisage their own self-suspension when it is a question of … democracy, and precisely this nice little democratic rule, written down in article 48 of the Weimar Constitution, allowed the democratic affirmation of Adolf, the “Great Dictator”. Under the same logic, Fascism is interpreted as an unpleasant hiccup in the continuity of a liberal-democratic State, when it was in fact its saviour. Democratic ingratitude!
***
And here comes the best of it, in the form of the revealing paradox: what are the No-debt supporters asking for, in the end? They are demanding “not to pay this debt and instead the costs of the crisis must be assumed by those who caused it. ” Well, on reading the history books we learn that the one who was able to consolidate the Italian public debt in the past, making the banks responsible for the costs, was not Sacred Democracy but … good old Benito Mussolini, a champion of the practice of curbing economic factors by using the State as a tool (7). He did this in the name of national interests, the “interests of the Italian people”, the same people referred to by those who evoke an “economic and social revolution of Europe’s peoples”. When speaking in the name of the Nation and the State, one lands on unexpected shores in unexpected company, because national interests are, in the end, the interests of national capital. The contrast that emerges in this ultra-democratic rebellion against the debt is that between national capital and international capital, between Peoples and world Finance, between the State as regulating mechanism and the lawless Market. It is the same logic as inspired black-shirted Fascism in past times. And so it is not incongruous for some of these last-minute moralizer (as, in Italy, the 5-Star-Movement of Beppe Grillo) to count the support of the far-right parties at administrative elections, nor to accept the anti-immigration arguments of the right. As to the various union leaders, right at the front of this procession of indignados, they rightly belong to a perfectly Fascist corporative tradition, adapted to the conditions of an anti-Fascist Republic with the same basic aim: to subordinate the proletariat to the interests of the Nation.
In this Barnum circus which brings together neo-Fascists, anti-Fascists, union leaders, workerists (united under the slogan “Jobs! Jobs!”), the cabaret artists that some old parties in the government gang wink an eye at, we also find the worthy representatives of the Italic “national-communist” tradition. Let us give an example of their contribution to the No-debt cause in the following extract where the author, having shown off his familiarity with Marxist categories in the interpretation of the national debt, concludes:
" For some time we have been arguing that the only alternative to the economic and social catastrophe is annulment of the debt burden, the pure and simple cancellation of it. Such a measure is shunned by the plethora of liberal and liberist economists, who maintain that it would be an attack on market laws, whose spontaneous interaction we should continue to believe in. It is all too easy to remark that it was these very market laws (on a market dominated by returns and financial speculation) that has put us in the position we are now and that leaving the so-called ‘market’ free to do what it wants not only means trusting in predatory finance but also heading straight towards the abyss. Others say that a measure like this is impossible to put into practice without upsetting the balance of the capitalist casino. This is true but the fact is precisely that there is no way out of the chaos without exiting from the system, without cutting off the flow through which capital returns and the parasitic sectors of the bourgeoisie living off the income generate oxygen and wealth at the country’s expense.
‘Annulling the debt – they answer us – implies hacking the present banking system to pieces and certainly leaving the Euro zone’. This, too, is true: annulment of the debt does in fact imply three complementary measures: the recovery of monetary sovereignty, the nationalization of Bankitalia and that of the banking system. ‘Sensible’ people hold these measures to be revolutionary and, thus, what we propose to be ‘absurd’. In any case, the masses have hell before them: they have to decide not whether to make hard sacrifices or not, but for what purpose, whether to make them in order to change the system or to make them in order to preserve it, with the risk of finding themselves up against other, worse catastrophes." (8)
In passing let us just note the underlining, not by chance, of financial speculation andeconomic liberism as the origins of the present damage, as if they were not themselves the necessary products of Capital’s evolution, but of a parasitic fraction of it. Fine then, let’s annul the debt. But if we were to ask who should take responsibility for applying these “revolutionary” measures, what government should be able to approve them, the reply would not be unlike that of all the other Barnum acrobats: a nice national government arising out of the will of the people, that will re-nationalize the currency, nationalize the banking system, place controls on the flow of capital and goods, launch employment and industry anew with productive investments, from public works to building, from alternative energy to armaments; briefly, launch anew the cycle of accumulation that became snarled up in financial speculation. The Mother Country and Jobs! Social Cohesion! Democracy (if at all necessary, suspended)!
These “revolutionaries” look back to the good old welfare system, to the Keynesian apparel, to the solid and strict relation between State and trade unions, to all that the powerful dynamics of capitalism have already widely experimented and exhausted. These are the great “final aims”, the “new system”, that are supposed to arise out of the dissolving of the Euro zone and the collapse of credit: what is more, with the claim that capitalism should be forced to return to the dimensions of a home market with the inevitable recourse to massive protectionist measures and all that derives from this. Is there any need to point out just how old and rancid all this sounds?
Against this logic from within the bourgeois camp, which tends to mobilize the proletariat in a battle to conserve the bourgeoisie as the ruling class, threatened as it is by capitalist development itself, we stand with Marx when we affirm that liberists are objectively more revolutionary than these modern protectionists. For us this confirms that the crisis is maturing a process of objective convergence between “popular” right- and left-wing forces, the former linked to the plebeian tradition of historical Fascism, the latter to the national-“communist” tradition of the Italian CP and its bastard offspring, united by the idea of a “national revolution” that is supposed to be anti-capitalist because it means placing controls on the anarchical dynamics of capitalism and its destructive reflections, without removing its bases: the business enterprise and wage labour.
All this fits perfectly with our classical thesis: that Fascism historically achieves the objectives of social democracy. Instead, we hope that the train of Capital, with its driver busy stoking the firebox, will crash into a wall erected by the revolutionary proletariat, before carrying the human species to ruin in its mad race. Only then will all the debts between human beings be wiped out, though the one that will unfortunately remain will be the devastating result of the “demented economy” on the balance of Planet Earth.
***
The battle against the parasitism of financial capital is obviously close to our hearts: but for us it is just one aspect of the more general social and political battle against the capitalist system and cannot be the main one. On the one hand, it is necessarily linked to recovery of the class war in the forms consecrated by a by now century-long tradition and certainly not to pro-referendum initiatives or shows of impotent indignation; on the other hand, it can only be an international battle, not to be misunderstood in terms of “defending the conditions of the nation threatened by outside aggression” – in the present case, in the form of a financial war. And here a comparison comes to mind with the “struggle against Versailles”, which marked the political and social clash in Germany during the years of the Weimar régime. At that time the class war was really raging, animated by the internationalist perspective of the October Revolution; nonetheless the German communist movement, despite Lenin’s warnings, came to regard the oppressive conditions imposed by the Treaty of Versailles as being in some way central to the clash that was going on, and took up the rejection of them as its own objective, gradually ending up by giving credit to the prospect of a “national revolution” of all German people, oppressed by the victors of the Entente. This was one of the keys leading to defeat. We know that the prospect of a German “national revolution” was instead put into practice by quite different forces which, once in power, took steps to cancel the debts for war damages unilaterally. In this respect, Hitler was unquestionably an authentic supporter of the No-debt thesis.
Those who fail to adopt the Marxist criteria of revolutionary and internationalist class war in their interpretation (and thus transformation) of the world risk finding themselves with similar ancestors in their family albums: because there are no middle ways, or “third” ways, between Revolution and Counter-revolution.
NOTES
1- “America”, in Prometeo n. 7, 1947
2- “America”, cit. In another of our articles at that time, “Imprese economiche di Pantalone”(Battaglia comunista, n.20, 1950), we read: " “Mr. Pantaloon of the Needy, de te fabula narratur,you are the one in question, the fine patches you use to cover age-old misery. In you, the popular good sense has found the perfect personification of a Marxist image of the people, whose only share of the State or public goods is the debt, whilst ‘national wealth’ belongs to their lordships.”
3- Marx, The 18th Brumaire of Louis Bonaparte, Chapter VI, http://www.marxists.org/archive/marx/works/1852/18th-brumaire/ch06.htm
4- Marx, Idem
5- Quoted by Marx in Idem.
6- Thus writes Italian union leader Giorgio Cremaschi in Liberazione, 16.04.2012, in Http://rebusmagazine.org/fuori-traccia/la-rivoluzione-in europa-non-pagare-il-debito/
7- See D. Fausto, “Lineamenti dell'evoluzione del debito pubblico italiano (1861-1961)”, pp. 97-98, www.delpt.unina.it/stof/15_pdf/15_6.pdf.
8- See M. Pasquinelli, “Mission impossible”, a counter enquiry on the public debt, website of the Movimento Popolare di Liberazione, MPL.
