The increase of political and economic turmoils - from Ukraine, the Middle East and North Africa to the Euro crisis - are symptoms of a worldwide systemic crisis, says Immanuel Wallerstein. The global capitalist system reaches its limits, as its engine, the endless accumulation of capital, has started stuttering. One of the root causes of this process is the fact that more and more jobs even in the service sector of the middle class are being replaced by machines. Thus fewer and fewer people have the means to buy up the produced goods, investments do not pay off anymore, speculation is soaring. The system itself cannot solve this problem. The solution can only evolve after the current chaotic phase of transition to a new system.
Immanuel Wallerstein, senior research scholar at Yale University, USA. Co-founder of the world-systems analysis. From 1994-1998 president of the International Sociological Association. Author of numerous books, including "The Modern World-System".
Fabian Scheidler: Professor Wallerstein, we met four years ago in Dakar, Senegal, and talked about the growing instability of the Capitalist World System. Since then, a lot has happened: the rise and fall of the Arab Spring, the accelerating crisis in Southern Europe and the Eurozone, the Ukraine crisis and also the rise of the Islamic State in Irak, Libya and elsewhere. Are we on a path into more and more global instability, and if so, why?
Immanuel Wallerstein: Yes, absolutely we are on a path to more and more global instability and why? We are in a systemic transition: We are in a systemic crisis of the capitalist world system such that it is falling apart and will in fact go out of existence. We are in a long transitional phase of 60,80 years, and we are in the middle of that. It is characterised by this chaotic fluctuations that are enormous ... in the economy, in the geopolitics, in everyday life, in everything. All the things that you have mentioned are simply parts of that chaotic disturbances which are uncontrollable and very frightening to people and well, they should be, because it is a very risky situation on the individual level as well as on a systemic level. So yes, we a are in a crisis, it’s getting worse – it’s not getting better, it’s not going to get better until it is resolved in one way or the other by tilting in one direction or the other of the bifurcation in which we find ourselves.
Scheidler: You say that in your analysis it is a five hundred year system which is coming to an end.
Wallerstein: That’s right.
Scheidler: What exactly is coming to an end and what are the perspectives?
Wallerstein: It’s a system built on the ceaseless accumulation of capital, and to accumulate capital you have to make what is called profit out of productive enterprises. And the fact is that the cost of the production has gone up so high and the possibilities of effective demand for that production have gone down so low that you can’t really make profit, you can’t accumulate capital. Lots of people have always been unhappy with the capitalist system, but in addition to that unhappiness coming from the base there is now the realization by capitalists that it isn’t working in their favour: They can’t accumulate the capital So the question is to find an alternative mechanism of maintaining their wealth, their power and their privileges etc. We have a situation in which no-one wants the continuation of the system for different kinds of reasons and the question before us is not: Do we like the system or do we not like this system, but what system should replace this system? There are two basic alternatives, one better, one worse, in my view – but that’s my appreciation of the situation.
Scheidler: It sounds a bit unfamiliar that the accumulation of capital is no longer possible, when we look at companies like Apple or Exxon Mobile which make huge profits. What is your view on that?
Wallerstein: Yes, they make huge profits, but the key thing to look at is not so-called growth, which Apple is a good example of. Growth, after all, can be cancerous, of course not necessarily a good thing. The key thing to look at is employment. And to look at employment levels in world figures, not national figures, which are irrelevant. Basically, if it goes up or down in one nation, this is quite irrelevant, and if you look at those unemployment figures, they have been going up and up and up. The fact is that the new kind of industries which get founded these days and out of which you can make some money don’t employ many people. That’s the real problem today. It’s not only that the unskilled workers are no longer needed, replaced by machinery, but the skilled workers are no longer needed. In fact, what we call middle class white collar workers are no longer needed and are basically being replaced by all kinds of mechanisms. That’s fine for an individual company, but what it means is that there is nobody there that buys the products and that’s the real problem. That there is nobody to buy the products. If there is nobody to buy the products it doesn’t make sense to invest money in order to create the products to be sold. And so we are in that kind of squeeze everywhere which doesn’t get better. It gets worse and worse and worse.
Scheidler: You have also written about speculation that when investment is no longer profitable …
Wallerstein: Well, speculation doesn’t create new capital. Speculation is just the mechanism of shifting the capital from the hands of A to the hands of B. That’s fine for B, and bad for A, but it does nothing for the system as a whole. That’s the point.