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Capitalism Run Amok Is Just Plain Capitalism
16:37, January 17, 2015
By Markar Melkonian
The source of Armenia's misery and humiliation, we often hear, is not
capitalism per se, but rather "gangster capitalism," "a broken
system," "capitalism run amok."
The goal for the future, then, is to "fix the system," to reform
capitalism, to make it more like regular, pure, genuine Free
Enterprise, the kind of capitalism that works. But what if Armenia's
actually existing capitalism already is genuine capitalism?
An economist once observed that the only existential meaning of
"enterprise" in the term free enterprise is "whatever capitalists
happen to be doing at the time"--and "free" is the accompanying demand
that they be allowed to do it.
In Armenia, successive presidents, legislators, ministers, and
mayorshave certainly allowed them to "do it."Post-Soviet cliques have
privatized public land, seized factories, and plundered resources.
They have shredded the social safety net,unleashed the "job creators"
on child labor; eliminated overtime pay; dispensed with job safety
standards, trashed even the most minimal environmentalregulations, and
generally done everything they can toenrich themselves and their
cronies, seemingly without a thought to the welfare of the
vastmajority. Over the years, Hetq.am has done a truly admirable job
of reporting the daily pillage.
Armenia's plutocrats justify their actions in the name of free
enterprise, and their point is well taken. After all, a law
prohibitingthe exploitation of child labor or the poisoning of
drinking water is nothing if it is not state regulation of the market.
Building public schools and enacting laws that protect forestsmake
markets less free.So if Free Enterprise really were as important as
the IMF and the advisors from Chicago say it is, then Armenia's
oligarchs really are the national heroes they think they are.
One of the Ronald Reagan admirers who led Armenia's charge down the
road to ruinexemplified the wisdom of Yerevan's Free Marketeers: "free
market reform," he wrote, is the path "which has been traveled by many
other nations and which leads to happiness."(Vazgen Manukian, quoted
in Jirair Libaridian (ed.), Armenia at the Crossroads, 1991, p. 52.)
In the years since he made this announcement, we have beheld the
happiness that free market reform has wrought in many other nations,
from Mexico to Greece, and from Iceland to India, where in recent
yearsa quarter of a million farmers have committed suicide.
The oligarchs and their IMF advisors, of course,are willing to pay
this price for the sake of their Free Market utopia. Or rather, they
are willing to make the poor pay this price. For decades, sensitive
commentatorsin the West excoriated Joseph Stalin for his
"blood-curdling" suggestion that the end justifies the means. These
days, those same commentatorsdo not give a passing thought to the
hundreds of millions of lives consigned to displacement,drudgery,
fear,and early death in the name of free market reform.
A quarter century ago, the Ter Petrosyan administration set Armenia
off on the path to happiness by doling out state property to cronies
and racketeers,guttingthe industrial infrastructure, and shredding the
social safety net. Hundreds of thousands of workers lost their jobs,
anduntold thousands of Armenians, especially the elderly and the very
young, have died of exposure, food poisoning, preventable accidents,
and lack of access to basic healthcare.
Since then, aparade of alternating opposition figures and national
saviors have come into office, enriched themselves and their cronies,
and then left the scene with the loot, one after another. Despite the
personnel changes, though, economic policy has continued to benefit
the rich few, at the expense of the poor majority.
Armenia has undergone twenty-five years of foreign-directed reform:
privatization, shock therapy, conditionalities, and so on. Every time
we turn around, it seems that more "reform" is needed. And the reform
always seems to require further wage cuts, further cuts to social
programs, further deregulation, and ever more sacrifice from the
have-nots. Consider the much-ballyhooed Structural Adjustment
Policies (SAPs) of earlier years: for Armenia, as for other poor
debtor countries, SAPs required:
selling off state enterprises to the private sector;
eliminating price controls and producer and consumer subsidies for
agricultural goods;
devaluing the local currency;
cutting consumer subsidies and charging user fees for social services
such as health care and education;
dropping protectionist measures and reducing regulation of the private sector;
providing guarantees, state-funded infrastructure, tax breaks, and
wage restraints as incentives for investment;
dismantling foreign exchange restrictions (which has allowed wealthy
locals to export funds overseas, as capital flight, worsening
balance-of-payment deficits).
As a result of these policies, Armenia today can boast of Enterprise
that is as Free as anywhere on Earth. Readers of Hetq.am are aware of
the consequences: sky-high unemployment; proliferating poverty; the
depopulation of the countryside; deforestation; plummeting birth
rates; falling life expectancies, and, of course, the catastrophic
outmigration of one third of Armenia's population. Successive
plutocrats have lengthened the work week, lowered the legal work age,
evicted families from their homes in order to build "elite homes for
elite guys," demanded ever-higher bus fares for a privatized transport
system; raised university fees far beyond the means of most families,
attempted to privatize social security, and so on and so forth, ad
nauseam.
It is a sad commentary on the state of intellectuals in Armenia today
that few of them are even aware of the work of the great social
geographer David Harvey, who has so accurately described the process
of "capital accumulation by dispossession" that characterizes scores
of countries like Armenia. When is someone going to translate
Harvey's book, The New Imperialism, into Armenian?
In Armenia, as we know, "free market reform" has taken place against
the background of official impunity, the jailing of dissidents,
electoral manipulation, and fraud so pervasive that it would have
astonished even the most cynical Armenians of the Soviet period.
Let us remind ourselves that these measures were undertaken under the
tutelage of the IMF and the World Bank, in strict adherence to Free
Market doctrines. All the while, Western agencies and bureaucracies
have heartily congratulated their Armenian followersfor rapidly
privatizing state property, "making hard choices," and faithfully
carrying out Washington's directives.
David Brooks, one of the more thoughtful American Free Market
columnists, recently acknowledged that, curiously, post-Soviet success
stories are rare. ("The Legacy of Fear," New York Times, November 10,
2014.) Despite the generalized "wreckage," however, he was able to
identify several success stories, including none other than Azerbaijan
and Armenia! That's right: according to Brooks, Armenia today counts
as one of "only five countries that have emerged as successful
capitalist economies" from the former Soviet bloc.
This should surprise the Free Market faithful in Yerevan, who were
hoping that ultimate success lay in the bright future, not in the dark
present. If this is what a successful capitalist economy looks like,
then the question naturally arises: What was the point of letting
capitalists take over the country in the first place?
The Free Market coercion and rhetoric has come full circle:
right-wing politicians in the USA, exemplified by Scott Walker, the
governor of the state of Wisconsin, have tried to enact many of the
same policies in the USA that the IMF, the CIA, and the economists
from Chicago have foisted on vulnerable countries like Pinochet's
Chile and today's Armenia. In their arguments for, say, privatization
of social security, the Scott Walkers have pointed to policies in
Latin America, Eastern Europe, and the former Soviet republics as
examples of an irresistible global trend that America must follow.
When the Scott Walkers have failed to achieve their maximal demands,
it is because traditional constituencies in the United States with
independent organizational presence--notably labor unions--have fought
against free market "solutions." Here, ironically, America does
provide a valuable lesson to Armenia: resistance to Free Market
reform must be organized, sustained, and based in the working class.
The tide of misery rises ever higher, and there is no good reason to
hope that further reforms along the same lines will change the
trajectory. And yet capitalism still escapes blame for the disasters
it has created. Instead, we are told that "capitalism run amok" is to
blame, and that the only antidote is--more capitalism! This has
happened over and over again.
At what point will skepticism kick in?
Free Marketeers love to sermonize about accountability and the
responsiveness of the market. But the Free Marketeers escape all
responsibility for their policies and get to prescribe more of the
same poison to the patient.
As long as we are unable to describe the problem accurately, we will
not even begin to address it in an effective manner. The first step is
to start calling the thing by its name: the main source of Armenia's
devastation in the past twenty-five years is not "capitalism gone
amok"; rather, it is capitalist rule.
(MarkarMelkonian is a nonfiction writer and a philosophy instructor.
His books include Richard Rorty's Politics: Liberalism at the End of
the American Century (Humanities Press, 1999), Marxism: A Post-Cold
War Primer (Westview Press, 1996), and My Brother's Road (I.B. Tauris,
2005, 2007), a memoir/biography about Monte Melkonian, co-written with
Seta Melkonian)
http://hetq.am/eng/news/58171/capitalism-run-amok-is-just-plain-capitalism.html
16:37, January 17, 2015
By Markar Melkonian
The source of Armenia's misery and humiliation, we often hear, is not
capitalism per se, but rather "gangster capitalism," "a broken
system," "capitalism run amok."
The goal for the future, then, is to "fix the system," to reform
capitalism, to make it more like regular, pure, genuine Free
Enterprise, the kind of capitalism that works. But what if Armenia's
actually existing capitalism already is genuine capitalism?
An economist once observed that the only existential meaning of
"enterprise" in the term free enterprise is "whatever capitalists
happen to be doing at the time"--and "free" is the accompanying demand
that they be allowed to do it.
In Armenia, successive presidents, legislators, ministers, and
mayorshave certainly allowed them to "do it."Post-Soviet cliques have
privatized public land, seized factories, and plundered resources.
They have shredded the social safety net,unleashed the "job creators"
on child labor; eliminated overtime pay; dispensed with job safety
standards, trashed even the most minimal environmentalregulations, and
generally done everything they can toenrich themselves and their
cronies, seemingly without a thought to the welfare of the
vastmajority. Over the years, Hetq.am has done a truly admirable job
of reporting the daily pillage.
Armenia's plutocrats justify their actions in the name of free
enterprise, and their point is well taken. After all, a law
prohibitingthe exploitation of child labor or the poisoning of
drinking water is nothing if it is not state regulation of the market.
Building public schools and enacting laws that protect forestsmake
markets less free.So if Free Enterprise really were as important as
the IMF and the advisors from Chicago say it is, then Armenia's
oligarchs really are the national heroes they think they are.
One of the Ronald Reagan admirers who led Armenia's charge down the
road to ruinexemplified the wisdom of Yerevan's Free Marketeers: "free
market reform," he wrote, is the path "which has been traveled by many
other nations and which leads to happiness."(Vazgen Manukian, quoted
in Jirair Libaridian (ed.), Armenia at the Crossroads, 1991, p. 52.)
In the years since he made this announcement, we have beheld the
happiness that free market reform has wrought in many other nations,
from Mexico to Greece, and from Iceland to India, where in recent
yearsa quarter of a million farmers have committed suicide.
The oligarchs and their IMF advisors, of course,are willing to pay
this price for the sake of their Free Market utopia. Or rather, they
are willing to make the poor pay this price. For decades, sensitive
commentatorsin the West excoriated Joseph Stalin for his
"blood-curdling" suggestion that the end justifies the means. These
days, those same commentatorsdo not give a passing thought to the
hundreds of millions of lives consigned to displacement,drudgery,
fear,and early death in the name of free market reform.
A quarter century ago, the Ter Petrosyan administration set Armenia
off on the path to happiness by doling out state property to cronies
and racketeers,guttingthe industrial infrastructure, and shredding the
social safety net. Hundreds of thousands of workers lost their jobs,
anduntold thousands of Armenians, especially the elderly and the very
young, have died of exposure, food poisoning, preventable accidents,
and lack of access to basic healthcare.
Since then, aparade of alternating opposition figures and national
saviors have come into office, enriched themselves and their cronies,
and then left the scene with the loot, one after another. Despite the
personnel changes, though, economic policy has continued to benefit
the rich few, at the expense of the poor majority.
Armenia has undergone twenty-five years of foreign-directed reform:
privatization, shock therapy, conditionalities, and so on. Every time
we turn around, it seems that more "reform" is needed. And the reform
always seems to require further wage cuts, further cuts to social
programs, further deregulation, and ever more sacrifice from the
have-nots. Consider the much-ballyhooed Structural Adjustment
Policies (SAPs) of earlier years: for Armenia, as for other poor
debtor countries, SAPs required:
selling off state enterprises to the private sector;
eliminating price controls and producer and consumer subsidies for
agricultural goods;
devaluing the local currency;
cutting consumer subsidies and charging user fees for social services
such as health care and education;
dropping protectionist measures and reducing regulation of the private sector;
providing guarantees, state-funded infrastructure, tax breaks, and
wage restraints as incentives for investment;
dismantling foreign exchange restrictions (which has allowed wealthy
locals to export funds overseas, as capital flight, worsening
balance-of-payment deficits).
As a result of these policies, Armenia today can boast of Enterprise
that is as Free as anywhere on Earth. Readers of Hetq.am are aware of
the consequences: sky-high unemployment; proliferating poverty; the
depopulation of the countryside; deforestation; plummeting birth
rates; falling life expectancies, and, of course, the catastrophic
outmigration of one third of Armenia's population. Successive
plutocrats have lengthened the work week, lowered the legal work age,
evicted families from their homes in order to build "elite homes for
elite guys," demanded ever-higher bus fares for a privatized transport
system; raised university fees far beyond the means of most families,
attempted to privatize social security, and so on and so forth, ad
nauseam.
It is a sad commentary on the state of intellectuals in Armenia today
that few of them are even aware of the work of the great social
geographer David Harvey, who has so accurately described the process
of "capital accumulation by dispossession" that characterizes scores
of countries like Armenia. When is someone going to translate
Harvey's book, The New Imperialism, into Armenian?
In Armenia, as we know, "free market reform" has taken place against
the background of official impunity, the jailing of dissidents,
electoral manipulation, and fraud so pervasive that it would have
astonished even the most cynical Armenians of the Soviet period.
Let us remind ourselves that these measures were undertaken under the
tutelage of the IMF and the World Bank, in strict adherence to Free
Market doctrines. All the while, Western agencies and bureaucracies
have heartily congratulated their Armenian followersfor rapidly
privatizing state property, "making hard choices," and faithfully
carrying out Washington's directives.
David Brooks, one of the more thoughtful American Free Market
columnists, recently acknowledged that, curiously, post-Soviet success
stories are rare. ("The Legacy of Fear," New York Times, November 10,
2014.) Despite the generalized "wreckage," however, he was able to
identify several success stories, including none other than Azerbaijan
and Armenia! That's right: according to Brooks, Armenia today counts
as one of "only five countries that have emerged as successful
capitalist economies" from the former Soviet bloc.
This should surprise the Free Market faithful in Yerevan, who were
hoping that ultimate success lay in the bright future, not in the dark
present. If this is what a successful capitalist economy looks like,
then the question naturally arises: What was the point of letting
capitalists take over the country in the first place?
The Free Market coercion and rhetoric has come full circle:
right-wing politicians in the USA, exemplified by Scott Walker, the
governor of the state of Wisconsin, have tried to enact many of the
same policies in the USA that the IMF, the CIA, and the economists
from Chicago have foisted on vulnerable countries like Pinochet's
Chile and today's Armenia. In their arguments for, say, privatization
of social security, the Scott Walkers have pointed to policies in
Latin America, Eastern Europe, and the former Soviet republics as
examples of an irresistible global trend that America must follow.
When the Scott Walkers have failed to achieve their maximal demands,
it is because traditional constituencies in the United States with
independent organizational presence--notably labor unions--have fought
against free market "solutions." Here, ironically, America does
provide a valuable lesson to Armenia: resistance to Free Market
reform must be organized, sustained, and based in the working class.
The tide of misery rises ever higher, and there is no good reason to
hope that further reforms along the same lines will change the
trajectory. And yet capitalism still escapes blame for the disasters
it has created. Instead, we are told that "capitalism run amok" is to
blame, and that the only antidote is--more capitalism! This has
happened over and over again.
At what point will skepticism kick in?
Free Marketeers love to sermonize about accountability and the
responsiveness of the market. But the Free Marketeers escape all
responsibility for their policies and get to prescribe more of the
same poison to the patient.
As long as we are unable to describe the problem accurately, we will
not even begin to address it in an effective manner. The first step is
to start calling the thing by its name: the main source of Armenia's
devastation in the past twenty-five years is not "capitalism gone
amok"; rather, it is capitalist rule.
(MarkarMelkonian is a nonfiction writer and a philosophy instructor.
His books include Richard Rorty's Politics: Liberalism at the End of
the American Century (Humanities Press, 1999), Marxism: A Post-Cold
War Primer (Westview Press, 1996), and My Brother's Road (I.B. Tauris,
2005, 2007), a memoir/biography about Monte Melkonian, co-written with
Seta Melkonian)
http://hetq.am/eng/news/58171/capitalism-run-amok-is-just-plain-capitalism.html