SERIOUS THOUGHTS ABOUT THE FUTURE PART THREE

Capitalism is, but its nature, in a constant stake of change. Schumpter described it as "creative destruction." Corporations are driven by competition and the aspirations of their managers to contrive ever more efficient arrangements for producing and selling their wares, and these innovations, inevitably, prepare the way for a rationally planned economy. Two familiar examples will suffice. One source of inefficiency and cost in production is the necessity of maintaining large stocks of factor inputs -- fuel, raw materials, partially processed components, and the like -- which are available as they are needed in the course of the production process. Through careful analysis of the flow of production, aided by computerized tracking of components, major industrial undertakings like automobile plants can manage much more efficiently with "just in time" sourcing -- the shipping to the production site of required inputs just at the time when they will be incorporated into the finished product. Just in time sourcing allows for major savings, as the corporation is not required to keep capital tied up unproductively in stockpiles for weeks, or even months. The system also permits the suppliers to plan their own production processes, with the result that at every stage, gluts and bottlenecks are eliminated. Compare these arrangements with the management of inputs of early companies, which might buy their supply of a factor input monthly, or even annually, and then simply store it at considerable cost while waiting to use it.
The second example is the computerized management of inventory in retail operations with enormously large numbers of different products. We are all familiar with barcodes, which are now ubiquitous. By means of them, a supermarket or a Walmart store can track precisely the flow of each individual category of item, telling the manager in a glance which items need to be restocked. The last time I bought little cans of cat food at a PetSmart outlet, the checkout clerk had to scan one can from each case, even though they were all the same price, so that inventory management would know which brands and items to reorder.
These homely examples may not strike you as terribly interesting, but they, and countless others like them, constitute a revolution in capitalism that makes rational planning at long last feasible. Once we have reached the point at which a single firm can track its inventory and plan its production by these means, it is a small step to integrating the sales of many outlets and the production of many firms into an economy-wide plan. Capitalists do not intend these innovations to prepare the way for a planned economy, but they do nonetheless. This, in part, is what Marx means by a new order growing in the womb of the old.
We come now to the financial crisis, which concerns neither production nor distribution of commodities, but rather the flow and management of financial capital itself. The world is at this moment in the midst of a major financial crisis that is very far indeed from having been managed. All of us in the United States have been watching the slow-motion train wreck of the American financial sector, but the crisis reaches across the globe. The latest focus of attention is the deep trouble of the Greek economy, and its ripple effects throughout the Eurozone. A year ago it was the Icelandic banking sector that collapsed. There is no reason to think that we have seen the last of it.
I do not pretend to be able to predict the course that this crisis will take, nor can I even estimate the scope of the damage that it will inflict on millions, if not billions, of people around the world. Speaking only of America, it is clear that uncounted millions of Americans have lost, or will lose, their homes and their retirement savings, and will lead lives as senior citizens that are devastatingly less comfortable than what they had planned for and expected. There is no familiar index, analogous to the Dow Jones Index of Industrial Stocks, that tracks the well-being of Americans [though economists have made some stabs at creating one], and it is difficult therefore to grasp quantitatively and synoptically the scope of the human suffering inflicted by the financial crisis.
Two things are certain, however, I believe. First, the managers of financial capital will seek institutional arrangements for managing the vast international flows of capital, in order to protect themselves and the interests they serve from future crises. And Second, when they do so, they will unintentionally be creating the foundations for a planned economy.
Contrary to Marx, I do not believe that there are mechanisms in place that will engender the counter-movements leading to an overthrow of capitalism and the installation of socialism. But I do believe that as capitalism, both industrial and financial, rationalizes itself in order to pursue profit and avoid crises, it will bring into being structures that can at least in theory be turned to social ends, humane ends, collective ends, despite the intentions of those who created those structures. In short, while I believe that capital is capable of rational self-transformation, as it always has been, I do not believe that it can with any certainty protect itself against a rising tide of demands for the socialization of the ends, as well as the means, of economic activity.
Democratic political arrangements are well-suited for the collective expression of demands for socialization of the economy, even though, at least in the United States, those demands are probably better voiced with the use of the word "socialization."
As always, I end these perorations with a single word: Organize.