North Atlantic Treaty Organization. - Bonfire of illusions: the twin crises of the liberal world

Preface and Acknowledgements

I must confess to having had some second thoughts about the title of this book. The illusions that I had in mind were those forming the dominant ideology in the era since the end of the Cold War, and crucially the belief most famously articulated by Francis Fukuyama when he announced the End of History in 1989 that liberal capitalism offered the only basis on which humankind could hope to enjoy peace, prosperity and freedom. The starting point of this book is that this belief was exposed as illusory in the late summer and autumn of 2008, with the geopolitical setback suffered by the United States in the war between Russia and Georgia and the economic earthquake unleashed by the collapse of Lehman Brothers on 15 September 2008.

I still think that this is right, and indeed in this book I develop an extensive analysis in support based in particular on the long-term crisis of overaccumulation and profitability from which the advanced capitalist economies have been suffering for several decades. But I forgot the point that Marx made when he pointed out the limits of any purely intellectual critique of the religious beliefs people have: To call them to give up their illusions about their condition is to call on them to give up a condition that requires illusions .

Thus, despite the enormous material and symbolic blows that it has suffered, liberal capitalism attempts to steam ahead as if nothing happened. According to a study by the Bank of England published in November 2009, the state bailouts of the financial system have cost $14 trillion in the US, Britain and the euro-zone, nearly a quarter of global output. Yet governments still seek to propitiate the financial markets whose continued survival depends on their own efforts. Public services are butchered in the drive to return to neoliberal normality. Most absurdly, market solutions are proposed to the enormous problem of global warming.

And so the illusions have survived the bonfire. This is an exercise in collective deception and self-deception, but it indicates that we are dealing with illusions sustained by material interests. They are, in other words, a symptom of a condition that requires illusions. This makes ending that condition all the more urgent. The shambles of the Copenhagen climate summit in December 2009, which was torpedoed by cynical manoeuvres between the major powers, underlines how important it is to rid the world of an economic system driven by blind competition among firms and states.

In writing this book I have, of course, depended on others. At Polity I benefited from the support and assistance of Clare Ansell, Susan Beer, David Held and Sarah Lambert. Sam Ashman, Joseph Choonara and Chris Harman all read the book in draft and made very valuable comments. Lorenzo Fusaro helped me see the importance of David Harveys The Limits to Capital in integrating different partial perspectives on capitalism. I would like to thank them all for the help they have given me though naturally they are not responsible for the use I have made of it.

The year 2009 took a terrible cull of Marxist intellectuals of the 1960s generation. We saw the passing, for example, of Giovanni Arrighi and Jerry Cohen. Bonfire of Illusions is dedicated to two others. In the past decade, Peter Gowan developed a critical political economy of the contemporary world that is both original and stimulating. Before that Peter had, among many other things, headed a sustained effort to promote the development of anti-Stalinist socialism in what was still the Soviet Union and Eastern Europe. I learned a great deal from reading and talking to Peter. He was a splendid human being and his death in June 2009 was a great loss.

But then, suddenly and unexpectedly, Chris Harman died in November 2009. This is a source of grief that I still find it hard to express. Chris had been both a friend and a pervasive intellectual influence for more than thirty-five years. While he developed Marxist thought in many different areas, his work in political economy was particularly important and helped very much to shape my own views on the subject. It is especially sad that Chris should have died at a time when his writing on Marxist political economy was so productive, as is evident in what proved to be his last book, Zombie Capitalism . I read and commented on it in draft, as he did for both this book and its predecessor, Imperialism and Global Political Economy . It seems quite impossible that our long dialogue is over and I must continue without him.