Capitalists are but the personification of capital, which has no heart.

It is common knowledge that an arms economy promotes a “healthy,” robust economy even when those arms aren’t used to plunder foreign countries. Yet most people don’t know the reasoning behind this fact. For a correct understanding, it’s necessary to place the permanent arms economy in its historical context.

It originated in the monopoly capitalism era (1880-1940) which bridged classical capitalism (1790-1880) and late capitalism (1940 and on) as the state evolved to meet the needs of capital.

Due to the law of concentration of capital and the subsequent law of combined and uneven development, classical capitalism and free competition gave rise to monopoly capitalism.

Monopolies’ tremendously greater efficiency than small firms is dependent on enormous economies of scale. According to the last analysis, expanding markets are necessary for capitalist economic growth.

As Russian revolutionary Vladimir Lenin famously asserted, monopolies’ need for constantly expanding markets resulted in the horrors of imperialism, culminating in World War I.

Laissez-faire ideology, the rationale and justification for free competition, became increasingly invalidated as monopolies bought up market shares and bought out small enterprises by the dozen. As Lenin wrote: “Almost half the total production of all the enterprises of [America in 1909] was carried on by one-hundredth part of [the] enterprises!”

Leaving the market to its own devices, i.e. promoting an “every man for himself,” “devil take the hindmost” attitude, was considered the best approach for both economic growth and economic recovery. Rather, social Darwinism was the result.

The incongruity of basing policy on ideology condoning free competition spurred the Great Depression. In reality, free competition had served its historical purpose and passed away.

Recessions are the result of crises of overproduction. Overproduction is in terms of capital’s need for valorization, not in terms of exceeding society’s material needs.

That’s why in 1933, the government let 10 million acres of crops rot and 6 million pigs die, as people starved to death.

When the market is overstocked with unsellable commodities, capitalists cut back on production and layoff workers, increasing job competition, lowering the price of labor-power and lessening effective demand for products, which causes more industries to scale back on production, and so on, spiraling out of control with dreadful logic.

On the one hand, society can overcome these crises by empowering the working class on the basis of associated unions to manage a planned economy with ownership of the means of production held in common.

On the other hand, the government can subsidize profit-hungry corporations, condone their policy of fixing supply artificially low to drive prices up, and hand them fat contracts.

Now, the best scenario is contracting production of commodities that won’t appear on the already glutted market, a property unique to few commodities, principally armaments. Meanwhile, workers earn wages, buy surplus goods on the market and capitalists pocket a profit.

According to Marxist economic theorist Ernest Mandel, Nazi Germany was the first to discover this, and it was no coincidence that Germany’s economic recovery exactly mirrored its arms expenditure.

In America, the New Deal didn’t end the Great Depression. Militarizing for World War II did. When the war ended, government spending comprised some 30% of the GDP, a tenfold increase compared to pre-war levels. Military spending remains the largest recipient of income tax dollars, even following the Cold War.

However, a military economy only works its magic under one condition: There has to be an abundance of capital lying idle, so that the military is not competing to the detriment of business. This stipulation is met most of the time, not just in recessions.

The interconnection between capitalism and the permanent arms economy is alarming. If war was unprofitable capitalistically speaking, and not just from the humanist perspective, can anyone doubt that there would be less war? Bush undoubtedly calculated the effect a war economy would have on improving the 2001 recession, and subsequently his approval rating.

The permanent arms economy does not solve any problems at root, since the very “success” of employing surplus capital thus only serves to reproduce capitalism’s contradictions on a larger scale.

Accelerating concentration of capital leads to crises of overproduction and a falling rate of profit. Greater employment reduces the size of the industrial reserve army, driving wages higher, making it harder to exact a profit.

As of 2006, 41 percent of our taxes fund arms, war and their side effects. 2008 military expenditure will be $644 billion. This extreme wastefulness of human and material resources is characteristic of the capitalist mode of production, based as it is on exploitation.

Workers are alienated from the means of production, leaving decision making to the bourgeoisie, who are not in business to satisfy human needs, but to pocket the largest profit possible.

If that means funding sources of destruction over social uplift, they won’t hesitate, morally bankrupt as they are. Capitalists are but the personification of capital, which has no heart.

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