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PostCapitalism

A Guide to Our Future

By Paul Mason
13-minute read
Audio available
PostCapitalism: A Guide to Our Future by Paul Mason

Postcapitalism (2015) offers a close examination of the failures of current economic systems. The 2008 financial crisis showed us that neoliberal capitalism is falling apart, and these blinks outline the reasons why we’re at the start of capitalism’s downfall, while giving an idea of what our transition into postcapitalism will be like.

  • Capitalists and anti-capitalists
  • Students of sociology or politics
  • Anyone interested in what the future holds for modern-day societies

Paul Mason is the economics editor of Channel 4 News. His other books include Meltdown: The End of the Age of Greed and Why It’s Kicking Off Everywhere: The New Global Revolutions. He also writes for news outlets including The Guardian and The New Statesman.

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PostCapitalism

A Guide to Our Future

By Paul Mason
  • Read in 13 minutes
  • Audio & text available
  • Contains 8 key ideas
PostCapitalism: A Guide to Our Future by Paul Mason
Synopsis

Postcapitalism (2015) offers a close examination of the failures of current economic systems. The 2008 financial crisis showed us that neoliberal capitalism is falling apart, and these blinks outline the reasons why we’re at the start of capitalism’s downfall, while giving an idea of what our transition into postcapitalism will be like.

Key idea 1 of 8

Neoliberal capitalism is broken, largely because of fiat money and financialization.

The modern form of capitalism in place throughout the Western world is called neoliberal capitalism, or neoliberalism. According to neoliberalism, the best way for a society to grow and be prosperous is for it to allow its individual citizens to pursue their self-interests in a free market.

However, neoliberalism is failing. According to the Organization for Economic Co-operation and Development, or OECD, economic growth will slow over the next 50 years, while inequality will rise by 40 percent in Western countries. Why?

One major contributing factor is the increased use of fiat money. Fiat money is currency that isn’t backed by gold or silver: it derives its value solely from the state that issues its notes.

Neoliberal economies use fiat money to counter financial crises. For example, the European Central Bank printed €1.6 trillion during the 2015 crisis, which itself originated in 2009 when certain member states in the Eurozone, such as Greece and Spain, weren’t able to repay their debts.

The neoliberal practice of countering financial crises with fiat money can cause follow-up crises years later, because fiat money allows governments to take on more debt, even if they’re unlikely to be able to repay it later on.

Financialization, which began in the 1980s, is another major cause of neoliberalism’s downfall. Financialization is the process by which stagnant incomes in the workforce are compensated with credit given by banks.

Credit cards, overdrafts, mortgages, student loans and automobile loans are now a regular part of everyday life in the neoliberal world. Over time, this bank credit means that more and more of a society’s money is imaginary, since the money is generated purely by the interest owed upon these loans and credits.

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