New book examines character of deepening crisis in capitalist globalization
Published Nov 13, 2008 7:38 PM
Colossus with Feet of Clay:
What the new globalized, high-tech imperialism means for the class struggle in the U.S.
By Fred Goldstein
Available at leftbooks.com.
This is a must-read book for those seeking answers to the current crisis in
world capitalism. With the economic meltdown of 2008, the very future of the
system of international finance capital has been thrown into question.
Monumental write-offs of hundreds of billions of dollars by the world’s
leading banks and investment firms have occurred this year. Names such as Bear
Stearns, Goldman Sachs, UBS, HSBC, Wachovia, Citigroup, AIG, Fannie Mae,
Freddie Mac, etc., have become the focus of attention of not only the
bourgeoisie, but of working people who have seen their jobs, homes, pensions
and overall living standards plunge.
Official statistics on the U.S. economy indicate that over one million jobs
have been lost during 2008. Consumer confidence has declined while signs of
social discord have emerged, in part resulting in the willingness of many
whites to vote for the country’s first African-American president.
What has generated profound anger among working people throughout the U.S. is
the response to this crisis by the capitalist class and the bourgeois state,
which have given over a trillion dollars in taxpayer money to the very same
financial institutions that created the crisis.
This crisis, however, is not confined to the U.S. The subprime mortgage crisis
and the “credit crunch,” as it was described during the early
months of 2008, are now being labeled—even by the corporate
press—as a major economic dilemma affecting billions of people around the
The U.S. Federal Reserve Bank along with central banks throughout Europe and
the world have handed over hundreds of billions of dollars and other units of
currency to the bankers in order to stave off a rapid collapse of the system.
Despite all of these subsidies to the financiers, many of these firms have not
survived. Fannie Mae and Freddie Mac have essentially been
“nationalized” under capitalist control by the U.S. government in
order to soften the fall of the multi-trillion-dollar housing market.
Yet there has been no bailout for the working people of the U.S. and the world.
Millions have lost their homes and jobs. Their pensions are rapidly drying up
because many of these funds were invested in the gambling houses of Wall Street
and its counterparts around the world.
Nonetheless, the resistance and fightback are developing. Workers in Europe
have staged general strikes against rising fuel and food prices. There have
been food rebellions in various countries throughout the Caribbean and Africa.
In the U.S., a burgeoning movement calling for a moratorium on foreclosures has
made a political impact and is influencing the political dialogue taking place
inside the country.
The source of the crisis
Goldstein, utilizing Marxist economic analysis, has approached this crisis from
the standpoint of those who are most seriously affected: the working class, the
nationally oppressed and women. The author makes the case in very simple and
straightforward language that the crisis is one of capitalist
According to Goldstein: “This cycle dictates that, during periods of
capitalist expansion, the powers of production increase ever more rapidly while
the powers of consumption of society expand only gradually. Sooner or later
production outstrips consumption. Profit does not arrive in corporate bank
accounts until sales take place. If commodities cannot be sold at a profit,
inventories pile up, production stops, workers are laid off, and a crisis
ensues. That is the crude dynamic of the capitalist crisis of
overproduction.” (pp. xi-xii)
The author explains: “The new international division of labor pits
workers all around the world against each other in a race to the bottom. It
depresses wages of the working class in imperialist countries and expands the
sweatshop, superexploitation of the workers in low-wage countries. It makes
each capitalist recovery more difficult and undermines the historic advantages
accruing to the workers in a capitalist upturn. All this is aggravating the
general crisis of capitalism. High technology and low-wage capitalism on a
world scale are accelerating the crisis of overproduction and laying the basis
for a massive counterattack by the working class.” (p. xiii)
Women, race and the capitalist crisis
As it relates to the impact of the crisis on women and the nationally oppressed
in the U.S., Goldstein looks at this phenomenon within the context of the
historical development of the country. It was the stolen land of the Native
Americans and the slave labor of the African people, along with the low-wage
exploitation of Chinese workers in building the railways to the West Coast,
which made the U.S. the leading capitalist nation in the world.
The author takes note of the changing character of the labor force in the U.S.:
“The rise in the number of women compared to men in the workforce over
the last three decades is telling. In 1970, 79 percent of all men participated
in the labor force as opposed to 43 percent of all women. In 2005, men’s
participation dropped to 72 percent while women’s climbed to 60 percent.
Women’s participation in the labor force has steadily risen since 1980
and men’s participation has steadily declined. By 2005 there were 80
million men and 70 million women in the workforce.”
Goldstein emphasizes that women are more likely to receive lower wages than
men. He also points to the class nature of the Clinton-era “welfare
reform” policy that advanced “the politically reactionary campaign
to spread the idea that those on welfare were lazy people who just wanted to
‘live off the dole.’ It was racist in character because the racist
regime of U.S. capitalism has left so many Black single parents in poverty and
almost all references to the poor focus in on African Americans (even though
the majority of the poor in the U.S. are white).” (p. 134)
The author illustrates how the restructuring of capitalism has devastated large
sections of the Black working class: “The restructuring by the bosses
devastated Black workers, partly as a result of a deliberate effort starting in
the 1960s and 1970s to relocate plants away from the industrial central cities,
where there were great concentrations of the African-American proletariat. But
this devastation was also the result of a general decline in manufacturing and
particularly of the general attack on the union movement.” (p. 137)
The coming fightback
Goldstein not only analyzes the character of the modern-day capitalist crisis,
but he boldly puts forward a set of possible demands that can serve as a
rallying point for a national and international fightback movement. Looking at
the recent struggles that have taken place over the last three decades during
the overall capitalist decline, he firmly believes that the present crisis can
be reversed through a proactive approach by the working class and the
This struggle will not just encompass the workers of the industrialized
capitalist states. The proletariat in the U.S. and Western Europe must
understand the necessity of forming alliances with working people in the former
colonial and neocolonial countries. The globalization of capitalist production
has created the conditions for such an alliance, one that can transform the
course of history.
Goldstein’s work not only makes a significant contribution to the
resurgence in literature on Marxist political economy, but more importantly, it
serves as a guide for building broader and more militant social movements that
directly address the need to transform capitalist societies in order to ensure
a socialist future for humanity.
“Low Wage Capitalism” can be ordered online at
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