From: "Cercle social" <cerclesocial-AT-altern.org>
Subject: AUT: Some notes on capitalist-state in globalisation 
Date: Tue, 5 Mar 2002 19:34:41 +0100


Hello,

I feel that if State can become a capitalist and assume direction of capital
in "state capitalism" or "mix-economy capitalism", it's because state is
himself capital. That's more or less the perspective we develop within
Cercle social, in a discussion with Critical Times (Temps Critiques). Here's
a part of this discussion, first written for the French theoretical left
libertarian review la Gryffe. I don't translated notes, as they almost leads
to references of French books. Does anybody have any ideas about this
question ?

Nico
------------
Some notes on capitalist-state in globalisation

These notes aim at contributing to the demystification of the state, the
state that fills in depth the thought of the "left" up to its critical
margins. It tries to show that the state works as a private capitalist
company, which possesses a capital and invests it in the production of
commodities. The common socialist analysis sees state as "state of the
dominant class", in charge of managing the public affairs with best
interests of the capitalists. The main alternative consists in asserting the
superiority of the state on the capitalism. What is only returning the
problem. In both cases, the exact nature of their connections remains
mysterious, sometimes reduced to a sociological question.

Assert that the state is a private capitalist could arouse the question:
whom does it belong? To nobody in particular. For a long time, analyses on
the "state capitalism" reminded that the capitalism is a social report,
based on the exploitation, and not a simple legal form based on property. On
the other hand, it is managed by a bureaucracy and a political "class" which
removes from it substantial advantages. In this text, it is the analysis of
a particular, but essential aspect, of this relation that is going to be
sketched: the financial mediations represented by the tax system and the
national debt.

The capitalist-state

The main capital of the state is the Territory, which is similar to a landed
capital. It exercises there a series of rights, which allows extracting an
income by taxes, customs duties. But it does not content taking money: it
uses it to improve the profits of the public or private capital, either
directly in helps and different subsidies, or by creating the convenient
social conditions (cost of the work, formation, social peace, etc.). It is
the commodities of the state, that the private capitalists buy it by paying
taxes. Does the tax being paid directly by capitalists or by workers does
not change much, because it's always integrated into the global cost of the
work. There is so a cycle of money circulation between " public " and
private capital.

This cycle is very slow. To take only a single example: between the moment a
state invest in an educational program and the one where the workers
stemming from this program will have produced enough so that, by means of
the tax system, this money returns in the state budget and exceeds the
initial sum, he can take place twenty, thirty years. This slowness obliges
the state to have a global, long-term sight, as its future is not limited by
the fluctuations of one commodity in particular. It so makes the state an
element of stabilization of the system. It contributes also to mask the
profits of the state, already well hidden behind the ideological
mystification of general interest.

This ideological mystification is the corporate culture of the state. It
peaks in the myth of the free access to public utilities. The state absorbed
the political sphere to transform it into commodity, making of any
resistance become an anti-politics in the same way as the resistance in the
capitalism passes by the refusal of the work. It can make appear his
ideology as the reflection of the interest of each, although it is nothing
else the interest of bureaucracy and "political class». "Public utility" is
the name of the exploitation of state workers, whose salaries arise from the
capital of the state and whose essential production consists in allowing the
private sector to increase its profit.

But, and what is essential to understand, this engendered profit interests
directly the state, because it returns to it under direct or indirect fiscal
form. The state is so bound to capitalists by a trade relation. They are so
placed in a mutual interdependence, which does not exclude conflicts of
interests. It is this financial aspect, which is mostly neglected in the
analyses of the state. One knows how state supports capitalists, but one
forgets that this help has a price. At the same moment, the action appears,
in the common analyses, as free and without counterpart.

 The world market of states
For the private capitalist, tax is the price of the services from which it
benefits. But it is a global price that includes mostly services, which do
not concern it absolutely, at least directly and for its limited mind. There
is a contradiction around the contents of these services. The small
capitalist, boss of small company, can hate the state of all his forces or
take place under his protection, but he can not by-pass it: it is confined
in the national territory, and "its" state is in situation of monopoly.

Things are different from the transnational company, often richer than many
states. Theses one can choose the establishment of its various branches
according to its needs (cost of work, professional skill and formation,
labour and environmental laws, tax system). It is the basic principle of the
relocations of factories and the exports of capital. The national and
regional specialization on definite and very concentrated productions is
another consequence of it.

There is so a world market of states. Every state appears, with the eyes of
the capitalists, as a set of competitive advantages, whose fiscal cost is
only one of the factors. From this moment, states are placed in a
competitive system on the directly economic ground, and each is going to try
to highlight the appropriate specificities, even if it means being engaged
in a real fiscal war - where from the current stake around the fiscal
paradises or of the fiscal harmonization of the European community.

 The question of the national debt
In the vocabulary of the left, neoliberalism is synonym of all troubles,
because it is the ideological vector of the dismantling of the welfare state
and the mix capitalism economy. The deregulation is bound to the inversion
of the balance of power states / transnational in the global capitalism. But
if the state deregulates, it is to maintain the own profits. It is not
weakened so inevitably, even if its influence is seemingly lesser or
redefined on one function, social control.

It's the same for the privatisations. Except any ideological consideration,
a nationalized company has sense for the global profit, which it generates
and which returns in the state budget. If this one has not the necessary
capital to make if fructify, privatisation is not a bad solution, because it
gives an immediately available money supply and that it helps a company from
which a part of the profits will finish in the state budget by means of the
tax system. It is so not at all a sign of decline.

But the current states have all, more or less, public debts. How can it be
to otherwise after more than sixty years of cult of the benefactions of
national debt, of which Keynesianism was the main herald? Not only the poor
countries persist in borrowing to pay the interests of their debt, but the
USA, first capitalist power, are also the indebted country. The purpose of
the national debt was at the same moment to boost the economy by the state
commission and, there even, to strengthen the role of intervention of the
state in the economy. It allowed especially to avoid increasing the fiscal
pressure beyond the point where this one stops being really profitable.

But increase of the national debt presses heavily on the financial means of
states. The titles of the debt become then themselves commodities which
business is prosperous, but creates financial instability. In this context,
neoliberalism preached by the IMF, or the Maestricht criteria (which include
reduction of the debt), if they limit the immediate intervention capacity of
the state by dismantling public service, aim to restore the financial means
of the state by the reduction of the debt. Eventually, the neoliberalism
strengthens the state, by restoring its capacity of financial action.

Neoliberalism and neoreformism
The alternative was proposed by the demand of Third World debt cancellation,
new banner of the social Catholicism (Jubilee 2000 campaign) and of the
social democracy, take sights of utopia, because it expresses the
contradiction between the necessary reduction of the debt and the refusal of
the social forces which support the "left" to sacrifice providence-state,
which they are products and defenders in the same moment.

The neoliberal phase is, in a sense, a phase of primitive accumulation of
the global capital. Marked by the violence and the destruction of all which
was assimilate to common good - notably the providence-state or national
sovereignty. The neoreformist phase which could succeed it and which appears
as its antagonist today, will come to crown the new system of states by
legitimising the institutions under the form of an accomplished world state.
That's why they emphases on the question of financing an overall policy, by
a tax on financial transactions (Tobin tax) or, as it was advanced more
recently, an international tax on armaments, sketches of world tax system.
After all, a world state would not know how to exist without giving itself
the means to extract a profit of its global capital, to reproduce in its
scale the cycle of accumulation which had led to the current "nation"
states.

Nico
www.geocities.com/demainlemonde/






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