The collapse of capitalism and other nuggets from 2011

In some ways, this past year has been the counterpoint of 1989, the year in which the final countdown to the demise of Soviet and Eastern European communism began. Though the TV images of the Occupy movement, the Euro crisis and the worldwide economic malaise do not come near to matching the drama of the fall of the Berlin Wall, they are arguably no less significant. The events of 1989 and of 2011 both portended the bankruptcy of an ideology that had been the bedrock of governments and determined the lives of hundreds of millions of people.

The two decades that followed the fall of the Soviet Union were, supposedly, the victory lap of capitalism. After 70 years of bitter competition and proxy conflicts around the world, markets had conquered central planning. Fukuyama called it the end of history; the decisive vindication of liberal democracy and free markets over the totalitarian Marxists. It was meant to be clear sailing from then onwards.

Except that Fukuyama – and many, many others – got it wrong. Free markets are not the natural state of human beings; the final, evolutionary step in the ladder of governance. Capitalism is as much an ideology as communism. It makes the same type of deterministic assumptions that Marxism makes and is as prone to human failings as Marxism proved to be. And it has the same, vicious ideologues in Milton Friedman and his ilk as Marxism had in Trotsky and the Comintern.

The self-satisfied clarity and self-assurance of the Nineties have evaporated. Greed, profligacy and lack of regulation have tarnished capitalism forever and will probably lead to its dramatic transformation in the longer term. What will replace it is unknown, but it’s likely to be a middle way between Bolshevik centralism and the laissez faire capitalism of the Reagan-Bush variety. A variation of Scandinavian social democracy, possibly.

If the economic collapse that has been underway since 2008 is not sufficient proof of the exhaustion of capitalism, then the current Republican race for the US presidency should do the trick. I’m not a believing man myself, but I can almost believe in intelligent design when I see the breathtaking unintelligence of the leaders-in-waiting of Reagan’s party. Surely the timing can’t be coincidence? The spokesmen of capitalism proudly displaying such profound ignorance just as their ideology is collapsing around them. The Soviet central committee in its heyday would have been hard-pressed to match their uniform stupidity.

What does all that have to do with Israel, you may ask? (After all, isn’t this meant to be a blog devoted to Israel-bashing?) Well, two things.

The first thing is a reminder that our current prime minister, the honorable Binyamin Netanyahu, is a disciple of Milton Friedman and all things laissez faire. He was noted, during his tenure as finance minister under Arik Sharon, for dismantling the remnants of the welfare state and handing over public assets to the so-called tycoons. The bankruptcy of the capitalist order is his bankruptcy as well. Israel is also part of the capitalist constellation and is not immune to its consequences. Hard economic times are on the way.

The second thing has to do with the so-called Arab Spring, the other major development in 2011. Israel’s TV commentators and Arabists (another name for Arab haters) delight at denigrating the Arab Spring at every possible opportunity. The Arabs can’t do anything right, they are simple people who need to live under dictators, the Islamists are sure to take over –and so on.

I, on the other hand, am a believer (of the secular sort). It’s unrealistic to expect a country that has suffered under a dictatorship for 40 years to suddenly emerge into a Jeffersonian democracy. The people of Libya, Tunisia, Egypt, Yemen (and soon, Inshalla, Syria) are going to go through rough times and, yes, the Islamists will be dominant players in many of them. They are scarred and scars take time to heal.

Israel’s reaction to the Arab Spring has been to withdraw into its cave and wait for the shit cloud to blow over. There has to be another Mubarak or Gadaffi out there, surely?

As usual, Israel lacks the foresight and leadership to understand that a Middle East in flux offers as many opportunities as dangers. The old order is gone; the new order has yet to be established. Speculators buy in such situations, but Israel turns into concrete. (Or, more accurately, reinforces the concrete that has long since hardened.)

Like liberal capitalism, enmity between Israelis and Arabs is not a natural condition – the end of history. If there was ever a time to make a dramatic move towards altering the status quo it is now, when everything is up for grabs. There is no Arab state that poses a military threat and Iran is safely on the American radar. The last thing that the (already-collapsing) West needs is for Israel to intervene.

Instead, Israel should renounce its claim to Palestinian land, begin dismantling the occupation and seek a workable accommodation with the Palestinians. It’s possible. But it’s not going to happen. Israel prefers land and Jewish aggrandizement to peace. That’s the reality.