International Socialist Review columnist explains why the ruling class austerity agenda has been discredited—and at a terrible toll in human lives.
IN HIS 1873 afterword to the second German edition of Das Kapital, Karl Marx commented on how the conquest of political power by the bourgeoisie, or capitalist class, had “sounded the knell of scientific bourgeois economy.”
Earlier bourgeois economists, like Adam Smith and David Ricardo, had made genuine scientific contributions to the understanding of capitalist society, but once its power was established, it became much more important for the ruling class to use economics to defend the status quo as both reasonable and inevitable. As Marx and Engels had put it many years earlier:
The class which has the means of material production at its disposal has control at the same time over the means of mental production, so that thereby, generally speaking, the ideas of those who lack the means of mental production are subject to it. The ruling ideas are nothing more than the ideal expression of the dominant material relationships, the dominant material relationships grasped as ideas; hence of the relationships which make the one class the ruling one, therefore, the ideas of its dominance.
They put the idea more succinctly: “The ideas of the ruling class are in every epoch the ruling ideas.” In terms of mainstream economics, this meant that science came to be replaced by ideology—a set of ideas developed not primarily to discover the truth, but to defend the interests of the bourgeoisie. As Marx wrote in 1873:
It was thenceforth no longer a question whether this theorem or that was true, but whether it was useful to capital or harmful, expedient or inexpedient, politically dangerous or not. In place of disinterested inquirers, there were hired prizefighters; in place of genuine scientific research, the bad conscience and the evil intent of apologetic.
… Many liberals hoped that when Barack Obama was first elected in 2008, he would be the new Franklin Delano Roosevelt and initiate a 21st century New Deal that would both revive the economy and shift the balance of power in the U.S. back in the direction of labor.
The hopes were short-lived. Obama did push through a substantial stimulus package in his first year that stopped the U.S. economy from going into free fall, but which was not big enough to produce strong growth or make any significant reduction in unemployment. Since then, however, Obama has accepted the Republican view that budget deficits are the main problem, and since his reelection, he has taken the lead in proposing cuts to Social Security and Medicare.
… BUT WHATEVER the long-term consequences of austerity policies, their devastating immediate impact on workers and the poor around the world is very clear.
In their new book The Body Economic: Why Austerity Kills, David Stuckler and Sanjay Basu, a sociologist and an epidemiologist, respectively, survey the historical and contemporary record of sharply cutting wages and social programs, and document hw brutal toll in human terms. “The price of austerity is calculated in human lives,” they argue. “And the lives lost won’t return when the stock market bounces back.” In the book’s introduction, they write:
We were shocked and concerned at the illogic of the austerity advocates, and the hard data on its human and economic costs. We realized the impact of the Great Recession went far beyond people losing their homes and jobs. It was a full-scale assault on people’s health. At the heart of the argument was the question of what it means to be a society, and what the appropriate role of government is in protecting people.
During the current crisis, Europe and North America have seen an additional 10,000 suicides and perhaps a million new cases of depression. In the U.S., there has been a 30 percent increase in suicides by middle-aged Americans facing financial stress, long-term unemployment and other economic problems over the past decade. These consequences, however, are largely the outcome of the ways in which different societies have chosen to deal with their economic woes.
For example, Stuckler and Basu compare Iceland, which has protected social spending since the current financial crisis began, with Greece, which has been forced to slash government spending to get new loans. During this time, Iceland has seen no rise in its death rate, while in Greece the death rate has soared. “The human costs have become dramatically clear: a 52 percent rise in HIV, a doubling in suicide, rising homicides and the return of malaria—all as critical health programs were cut.”
Stuckler and Basu’s comparison makes clear that the economic crisis was not responsible by itself for the subsequent health crisis. “Ultimately, what we show is that worsening health is not an inevitable consequence of economic recessions,” Basu said in a statement. “It’s a political choice.”