catallaxy files

catallaxy in technical exile

Koestler on the failure of capitalism

with 2 comments

Here is an extract from Arthur Koestler’s autobiography to indicate the way that disastrous state intervention during the Great Depression was interpreted as the failure of capitalism instead of the failure of governnemt interference. This is a brief overview of the New Deal.

He is reporting on the program to support the farmers by keeping the prices of farm produce high with the result that supply exceeded demand or at least the capacity of people to buy. The surplus had to be junked, burned, buried or put down the drain.

The event that aroused my indignation to a fever pitch never reached before was the American policy of destroying food stocks to keep agricultural prices up during the depression years – at a time when millions of unemployed lived in misery and near starvation. In retrospect, the economic policy which led to these measures is a matter of academic controversy; but in 1931 and ’32, its effect on Europeans was that of a crude and indeed terrifying shock which destroyed what little faith they still had in the existing social order.

By 1932 there were seven million unemployed in Germany – which means that one in every three wage-earners lived on the dole. In Austria, Hungary and the surrounding countries the situation was similar or worse. Meat, coffee, fruit had become unobtainable luxuries for large sections of the population, even the bread on the table was measured out in thin slices; yet the newspapers spoke laconically of millions of tons of coffee being dumped into the sea, of wheat being burned, pigs being cremated, oranges doused with kerosene ‘to ease conditions on the market’.

It was a grotesque and incomprehensible paradox – incomprehensible to the simple-minded among its victims, and to the socially conscious a sign of the complete breakdown and decomposition of the economic system. Had not Marx foretold that Capitalism would perish through its own internal contradictions; that the cycle of prosperous periods ending in a crisis would repeat itself in an accelerated rhythm and each crisis be worse – until the last would certainly bring the capitalist system to its end? Clearly, the prophecy was on the point of being fulfilled. When people starve and food is destroyed before their eyes so that their fat exploiters may grow even fatter, then the last judgment must be at hand.

Woe to the shepherds who feed themselves but feed not their flocks! Indignation glowed inside me like a furnace. At times I thought that I was choking in its fumes; at other times I felt like hitting out, and shooting from a barricade or throwing sticks of dynamite. At whom?…My seething indignation had no personal target; it was directed at the System in general, at the oily hypocrisy and suicidal stupidity that were driving us all to perdition. In my rage fantasies no people were killed but huge buildings burst open and their walls came tumbling down, as in an earthquake…Echoes of the hundred days of the Hungarian Commune; echoes of the indignant wrath of the Hebrew prophets, and of the forthcoming Apocalypse according to St. Marx; the memory of my father’s bankruptcy,, the sound of the hunger-marchers broken-down boots on the pavement and the smell of fresh wheat being burned in the fields – all these ingredients fused into one emotional experience. My political latency period had come to an end.

Though the mixture that set off the explosion varied from case to case, the reaction was the same for a large number of  writers and intellectuals the world over: Barbusse, Romain Holland, Gide, Malraux in France; Piscator, Becher, Seghers, Brecht in Germany; Auden, Isherwood, Spender, Day Lewis in England, Sinclair, Dos Passos, Steinbeck, Caldwell in the USA – to mention only a few. In the nineteen-thirties conversion to the Communist faith was not a fashion or craze – it was a sincere and spontaneous expression of an optimism born of despair – an abortive revolution of the spirit, a misfired Renaissance, a false dawn of history.

To be attracted to the new faith was, I still believe, an honourable error. We were wrong for the right reasons; and I still feel that, with a few exceptions – I have already mentioned Bertrand Russell and H G Wells – those who derided the Russian Revolution from the beginning, did so mostly for reasons that were less honourable than our error.

In your dreams Arthur!

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Written by Admin

November 11, 2006 at 10:53 pm

Posted in Uncategorized

2 Responses

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  1. Rafe
    can you find a way to convert what you write into plain text before you post it? Try pasting it into Notepad first.

    There were lots of font tags in your entry which I had to remove as it was converting everything on the blog into small Times New Roman font.

    Jason Soon

    November 11, 2006 at 11:03 pm

  2. OK I think the problem arises when i cut and paste from Word. Will go through Notepad in future.

    Rafe Champion

    November 12, 2006 at 2:02 pm


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