Critique of "political economy"

I still have to encounter a serious critique of capitalist (and anti-capitalist) political economy that stresses the capitalist system's main nature as a huge gambling casino. As most capitalists cannot know in advance if and how much there will be of a market for the products and services they produce and provide and at what price, they are mostly gamblers...

Just for example, the high-tech industry involves a lot of startup projects that do not yield any saleable products. Only the few which hit the jackpot - like Facebook, Google, Apple and Microsoft - as well as the many moderate ones stand as examples that motivate so many high-techists to invest a lot of work and money in this field.

The "free market" is not really free, and States do intervene a lot in order to keep order and distribute favors, but uncertainty and gambling are the two main aspects of the main factor. States intervene with various contracts with private capitalist firms. They intervene for them in the international market. They regulate imports. They use differential tax policies, and so on.

The fact that the gambling involves not just the pure chance of slot machines or other games like card games, but also involves weather fluctuations and the real economy, neither of which are seldom entirely unpredictable, and cartels that lower competition and uncertainty, does not take away from the fact that gambling is the main factor. Certainly, part of the gambling/uncertainty - especially in the "real" economy - is by no means pure chance.

Any model of the economy of capitalism which does not include the various "non-economic factors" may be appropriate for studying a specific factor (by holding all factors constant or taking them out of the equation), but they are not appropriate for studying the system as a whole.

The periodic crises are not just a magical failure of the free market, nor are they the result of surplus production. Efforts to find factors within the production cycle itself that are responsible for the circularly-occurring capitalist cycle have always been doomed.

I studied Marxism intensively for two years till I discovered that the explanation of the circular crisis does not take into consideration the monetary factor and the Keynesian approach that intervenes in it by manipulating the amount of money/the means of exchange and softens the cycle when applied.

The false blaming of the tendency of overproduction and the tendency of the rate of profits to decrease for the circular capitalist crisis started me on the way to freedom from Marxist dogma.

The gambling factor at work

After a crisis in which some gamblers go bankrupt, some just lose a bit and some hit the jackpot, a new round starts. Gradually the speed of transactions accumulates, the gambling increases and grows and when the cycle reaches the turnover point when too many lose their bets, the cycle ends, the speed of transaction decreases, the gamblers hesitate, the "herd effect" causes a swift slow-down and a recession, and after a while a new cycle starts.

The last cycle, which ended in 2008, differed from previous ones in a few main points. First, from cycle to cycle the concentration of capital into a smaller number of corporations increased the size of the bets and the weight of each loss. Second, globalization united the casinos into one big one, with an increase in the size of each bet and in the effect of each loss.

Third, the decrease in taxation of big capital typical of the neo-liberal mode, instead of investment in the "real" diverse economy, created a huge amount of capital which found its way to investment in the real estate bubble.

Fourth, huge deception in the financial system management of credit for the building bubble with false bonds and insurance frauds on the false bonds. The banks gave mortages to people who had no ability to return them, with conditions that lured people into gambling as the initial rate of interest was so low; they then bundle these individual mortages and sold bonds lying about the ability of creditors to return them; then they issued "insurances bonds" - CDCs - for these and other loans without the reserves to cover the insurance when creditors defaulted. This way, the banks lured huge amounts of investment into the gambling bubble of the construction industry instead of investing these sums in the means of production and expanding these (and/or driving the less successful to bankruptcy).

These factors, in addition to States' intervention to prolong the cycle (to soften and delay the end of the cycle's crash) resulted in a bigger and deeper crash than previous ones.

As the neo-liberal mode of exploiting the working class enables, and as the pressure of big capital interwoven with the financial system demands, instead of letting the financial capital firms and those investing in them suffer the losses, the imperial powers of the US and Europe have mostly tried to force the losses onto the working class of their countries.

Only on the margin, Iceland and Cyprus were allowed to force the investors/gamblers in the banks to suffer the losses.

The good news is that the "owners" of the world casino are themselves gamblers. They bluff all the time and often, when the working people and political activists call their bluff, they yield.

We have seen how Iceland's capitalist system refused to yield to the imperial dictate and allowed the local banking casino to bankrupt itself with immunity. We have seen the case of Cyprus in which the imperial European power tried to force the Cypriot people to pay for the gambling losses of their banking system... and when they refused, they let the big gamblers/investors pay for most of the loss.

In Israel, we recently had a case in which a tycoon had a huge loss, connected with the world gambling crisis. The national bank intended to take on itself a part of the loss and let the tycoon keep the concern in his possession (and cover the loss from dues extracted from the smaller clients). However, a short protest in the new media forced the directors of the bank to refrain from the murky deal with the tycoon.

As gambling is part of human nature (and the nature of other animals too), you can treat the "false mentality of the working people" and class war too as involving aspects of gambling. We can use a lot of tricks and not just calculate the real power relations. In a way, many times acts of class war are themselves a gamble and the decision of people to join them is often based on the hope or a gamble for success and not on a rational calculation of power relations.