Book Reviews

Che in power

Che Guevara and the Economic Debate in Cuba. By Luiz Bernardo Pericás. Atropos. New York, 2009

  Guevara’s cult status rests on the fact that he was a martyr to his cause, fighting to free the poor in the Third World from oppression and exploitation (by US imperialism). Pericás probably thinks he is enhancing Guevara’s image in describing what he did when he was a member of the Cuban government from 1959 to 1965, two years before he met his death in Bolivia. In fact he reveals what would have happened in the event of the guerrilla-led peasant insurrections that Guevara championed triumphing.

  In Cuba Guevara was successively head of the National Bank and Minister of Industry. As such he played a key role in the construction of state capitalism in Cuba, even though he thought he was constructing “socialism” as a step towards the moneyless “communist” society that he seems to have genuinely wanted. According to Andrew Sinclair in Guevara, “he dreamed of the single wage-scale in which everybody would earn the same wage or would earn according to needs until money could be abolished altogether”. This may have been his longer-term dream but equal wages was not what he introduced when he was Minister of Industry.

  The policy the Cuban government pursued (made all the more necessary by the US embargo) was to industrialise the country on the same sort of lines as Russia had done, putting in place the same structures: a one-party state, state enterprises, integration of the trade unions into the state. a harsh labour discipline banning strikes, imposing labour passbooks and severely punishing absenteeism. As can be seen from this book, Guevara implemented and justified all these things. Hardly freedom from oppression and exploitation. The same thing happened in Vietnam.

  Pericás’s book details the discussions that went on while Guevara was a member of the Cuban government and amounts to an economic history of Cuba during this period. The translation (from Portuguese, as the author is from Brazil) is not perfect. If the author had proof-read himself he would surely have changed “mercantile production” to the more familiar “commodity production” and “good” to “commodity”.



Voodoo Histories: The Role of the Conspiracy Theory in Shaping Modern History. By David Aaronovitch, published by Jonathan Cape, 2009

  Perhaps the most disastrous of all conspiracy theories is the Protocols of the Elders of Zion. This is largely based on a book written by a Parisian lawyer in the 1860s as a satire on Napoleon III. It was altered later in the nineteenth century by a Russian secret policeman to depict a Jewish conspiracy to take over the world. The man who popularised the Protocols around the world was the capitalist Henry Ford. Published by Ford’s publishing house in the 1920s (along with other anti-semitic literature), subsidised with five million dollars, it sold half a million copies in the US alone. After mounting complaints about his anti-semitism Ford recanted and apologised, but Adolf Hitler saw him as a hero and the Protocols formed the basis of his world-view in his manifesto Mein Kampf. The rest, as they say, is history. Aaronovitch thoroughly demolishes this conspiracy theory, as he does with the alleged conspiracies in Stalin’s show trials, McCarthyism, the deaths of President Kennedy, Marilyn Monroe, Diana, the story underpinning Dan Brown’s Da Vinci Code (in a chapter entitled “Holy Blood, Holy Grail, Holy Shit”), the 9/11 attacks on the Twin Towers and the Pentagon (in which some claim the Bush government were complicit) and more besides.

  Aaronovitch argues that belief in conspiracy theories is harmful since it “distorts our view of history and therefore of the present” and can lead to disastrous decisions. He detects a pattern in which conspiracy theories are “formulated by the politically defeated and taken up by the socially defeated”. Conspiracies become an excuse to explain away a  movement’s own inherent weaknesses or unpopularity by attributing blame to a ruthless enemy. Aaronovitch claims that capitalism is not the cause of conspiracy theories since “tate ownership in Russia was no guarantee against the most fabulous of conspiracy theories”. But this mistakenly assumes that state ownership is incompatible with capitalism. When President Bush effectively nationalised some financial institutions in last year’s “credit crunch” this was done for the benefit of American capitalism as a whole. In any case, capitalism’s continued existence does not require a conspiracy or a conspiracy theory. All it requires is the support, or more likely acquiescence, of the overwhelming majority in their own exploitation.


Boom and bust

The Trouble with Capitalism.  By Harry Shutt, Zed books.

  It is easy to see why the publishers have re-issued this book that first came out in 1998 – in it Shutt argued that a devaluation of capital assets could not be avoided for ever and that when it eventually did happen it would take the form of a big crash.

  Mat Little, who interviewed Shutt for Red Pepper this January, summarised what Shutt sees as the contradiction of capitalism that leads to recurring business cycles of boom and bust:

“According to Marx, capitalism is a system of accumulation. Profits are made but can’t all be consumed by owners. Extra profits need to be recycled through the market. ‘The only way you can successfully recycle them is to either expand your existing business or diversify into another business,’ says Shutt. ‘It all depends on the ultimate consumer, consuming more and more. It has to grow, growth is built in.’ The problem is that as profits are invested into the market, generating more profits that in turn have to be reinvested, production expands until it reaches a level that can no longer be absorbed by consumers. The market is glutted, and recession results. But the destruction of capital and jobs creates pent-up demand for the whole process to begin again in time. That, in brief, is the business cycle.” (

  Although Shutt does not write as a Marxist, this is one of the explanations of the capitalist business cycle put forward by some in the Marxist tradition. It implies that all capitalist crises are caused by the overexpansion (in relation to paying demand) of the sector producing consumer goods. But while the crash of 1929 can be explained in this way, the history of capitalism shows that the overexpansion of any key sector or industry can provoke a contraction of production through a knock-on effect on the rest of the economy.

  Shutt explains the 25-year period of expansion after the end of WW2 in terms of the satisfaction of the market for affordable consumer durables and the end of this post-war boom as a result of the slowing down of this market. Capitalist enterprises were thus, he says, left with a ‘mountain of cash’, profits which could not be re-invested in expanding production, which he also describes as a ‘capital glut’ in the sense of an oversupply of  investible funds.

  What would normally happen in  such a situation is that, in accordance with the law of supply and demand, capital would be devalued; which a crisis would bring about, so restoring the rate of profit (because this is calculated as profit divided by the value of capital). Only, according to Shutt, this did not happen on any large scale in 1974 because the authorities (governments and central banks) took steps to try to stop this, by facilitating the channelling of the surplus of investible funds into non-productive activities such as lending to consumers or speculation on the stock exchange or in property:

“This massive flow of funds – which is not being allowed, as would be dictated by traditional capitalist rationale, to self-destruct through the natural operation of the business cycle – has to find an outlet in more or less speculative forms of investment.” (p. 179)

  Writing in 1998 Shutt saw the various financial crises till then – the stock market crash of 1987, the Mexican debt crisis of 1994-95, the financial problems of the Asian ‘tiger economies’ in 1997 – as signs that this was not sustainable and as harbingers of  the Big Crash to come. Now, with the bursting of the dotcom bubble in between, he sees the Crash of 2008 as the expected big one:

“What the prolonged amassing of this huge surplus of capital cum fraud-driven credit bubble, means, according to Shutt, is the inevitable crash – the inexorable end of the business cycle – is going to be far more severe that it would otherwise have been. ‘I think we are looking at negative growth, for an absolute minimum of two or three years and I wouldn’t be surprised if it’s five or ten. That would be a depression,’ he says.” (Red Pepper interview).

  Since our failure to foresee the post-war boom with our prediction that WW2 would most likely be followed by a slump, just as after WW1, we have tended to be wary of making such predictions ourselves. So, we will just record this as the opinion of one person who has studied the matter.


Ya Basta!

Enough. By John Naish: Hodder £7.99.

  Naish coins the word enoughism to describe the idea that most people’s material wants are satisfied, so we should not aim to consume yet more. In a world where more people are obese than starving, we need to draw a limit to what we eat or otherwise buy. If you are earning the median income for the country you live in, striving to earn more is unlikely to make you happier, and even the filthy rich (with over $125 million) don’t feel much more contented than the average worker. Don’t try to earn more by working more, since long hours of employment are bad for you. Working over 41 hours per week is likely to give you high blood pressure, while voluntary work tends to increase the life span.

  It is surprising to be told that ‘In the Western world we have now effectively have everything we could possibly need’. This ignores the extent of homelessness and other kinds of want that exist even in relatively prosperous societies; one child in three in Britain lives in poverty, for instance. Even basic needs like food, warmth and shelter are not met for many, many people.

  But Naish does have some interesting things to say about consumer society. With many goods, we are offered not a genuine choice but a whole range of trivial ‘options’ that are really all the same (whether it is a matter of shampoo or digital cameras). Cars and fashion are further clear examples of where people are pressured into having the latest innovation. All-you-can-eat buffets are becoming increasingly popular: though don’t they really show that people are not that well off after all, as well as how they behave in a society of scarcity when the constraints are temporarily removed?

It’s unlikely that socialism will be a kind of consumer paradise, and the notion of enoughness will probably apply, since there will be no profit motive to persuade people into having the latest of everything. We have no reason to think that he’s a socialist, but Naish does see some of the implications of a truly human society when he writes of the need to ‘explore anew our old, nourishing and truly sustainable natural human resources – qualities such as gratitude, generosity and the urge for human connection’.


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