The capitalist system
A market is a social structure that brings together a buyer and a seller to agree on a price to exchange goods or services. … The nature of market is such that the market always tries to bring itself to equilibrium.
The question I ask myself about the issue is capitalism.
where does capitalism go? We may not know the details, but what is certain is that it will survive because it is the economic subsystem of the immediate future, a future that could last if other events such as environmental catastrophe or decay do not interfere.
At the moment, it is firm and sure, with its frequent crises. They are rather recessions. The capitalist system has a crisis and will have them as it happens now: we are immersed in one of them, although we are not in the crisis ups and downs happen, and they do not occur every five years. There is no regularity. In western Europe, it fell at the end of the 18th century with the French Revolution, but in the 17th century, feudalism was still advancing in Poland and other countries in Eastern Europe.
History and its hundreds of economic systems throughout humanity attract my attention.
For example, the eastern despot of the Aztecs, Egypt, or China, with a network of centralized ownership in the royal power of the sultan or emperor and also includes the Incas and the Maya; the feudal, which we know in purity in Europe and Japan.
How does capitalism begin?
He says it started in Cataluña and Italy and expanded in the late Middle Ages to the north in Holland, Germany, England, and other secondary and peripheral places. Then the United States and Canada do not fall behind. The Anglo-Saxon world looks like an amoeba. Today they embrace the entire plant, including Russia and China.
In Latin America and the Caribbean, the first phase of neoliberal globalization accentuated the processes of denationalization of the economies as well as the conditions of a structural impoverishment, in the midst of internal polarization that favored the formation of transnationalized economic-political elites and fragmentation of the popular movement and forms of resistance.
This globalization under the neoliberal scheme has formally meant the abandonment of national development projects and instead has favored macroeconomic issues such as inflation control and the reorganization of fiscal finances for example, with consequences aimed at the destruction of trade unionism and the in formalization of the economy and with a considerable concentration of profits, as well as an increase in social inequalities.
For the Latin American and Caribbean countries, this situation resulted in the unilateral opening to foreign trade, the privatization of state-owned companies, the liberalization of the capital market, the fiscal adjustment and the reduction of public spending, as well as the weakening of state interference. In the macroeconomic administration with a very irregular growth of the economies, but with an intensified increase of the external debt and therefore of the conditions of the dependence of the capitalist world market.
But all this management of economic conditions could not have been carried out without an active role of the States, which meant their transformation with transitions to “democratic forms” that favored the domination of elites linked to the international market and the large corporations; and to a model of society whose basic sensibility went through the absence of alternatives.
In vain was trade resumed, in vain did swarms of international conferences display the idylls of peace, and dozens of governments declare for the principle of freedom of trade—no people could forget that unless they owned their food and raw material sources themselves or were certain of military access to them, neither sound currency nor unassailable credit would rescue them from helplessness. Nothing could be more logical than the consistency with which this fundamental consideration shaped the policy of communities.
Polanyi, Karl. Great Transformation: The Political and Economic Origins of Our Time, Beacon Press, 2001.
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