Zapata in Wall Street

julio 30, 2011 Article and Chapters / English

John Holloway

(Instituto de Ciencias Sociales y Humanidades,

Benemérita Universidad Autónoma de Puebla)

It was on 19th December 1994 that Zapata rode into Wall Street on his white stallion, cartridge belts crossed on her chest, the flash of dignity in her eyes. In the days that followed, there was consternation in Wall Street, panic on the world’s financial markets. The stock markets of the world shook, the political leaders confabulated. The volcano Popocatépetl started to belch forth smoke and ashes from its snowy top. It has never stopped since.

‘We have made the Power of Money tremble’, Zapata of the balaclava remarked some time later¹, ‘it has realised there is something it cannot buy or sell, that dignity is starting to unite. The Power of Money is afraid because the uniting of dignities signifies Its downfall, Its rapid transition to part of a nightmare that is coming to an end, the conclusion of a historical phase ruled by arrogance and stupidity’.

I

In the early hours of the 19th December, 1994, the EZLN announced that they had broken through the military cordon which had encircled them for almost a year, and had undertaken actions in 38 municipalities of the state of Chiapas².

The reaction of the financial markets was immediate. Capital fled. The prices of Mexican shares fell both in Mexico City and in Wall Street, as investors sold their stock. In the money markets, there was a flight of capital from the Mexican peso as money holders changed their pesos for dollars³. On the following day the Mexican Government announced a 15.3% devaluation of the peso in relation to the dollar and blamed the devaluation on the zapatistas. In spite of the devaluation, the flight of capital from the peso continued and, on the 22nd December, the government decided to let the peso float freely on the market. The peso fell and within a few days it had lost 40% of its value prior to the 19th December⁴.

In the weeks and months that followed, the impact of the Mexican devaluation and of the flight of capital from Mexico was felt thoughout the world. For several years Mexico had been regarded as the success symbol of neoliberal politics, the star of the ‘emerging markets’⁵, the poor country that had succeeded in constructing the North American Free Trade Agreement with its rich neighbours and in becoming a member (in April 1994) of the OECD (Organisation for Economic Cooperation and Development). When the peso fell, it seemed to many of the investors who had taken part in the enormous flow of capital to the emerging markets in the years from 1990 to 1994 that none of these markets was secure. There was a ‘flight to quality’ as capital flowed to the more firmly established markets⁶ and fled from those considered risky, threatening the stability of currencies and stock markets not only in Latin America (especially Argentina and Brazil) but also in Thailand, Hong Kong, Hungary, Sweden, Spain, Portugal, Pakistan, South Africa, Italy, Indonesia, Poland, Nigeria, Canada and many other countries⁷.

In the middle of January, the President of the United States declared that his government would give a loan of $40 billion to stabilise the Mexican peso. When this proposal encountered strong opposition in Congress, Clinton announced the creation of an international package of support totalling more than $50 billion, by far the biggest intervention of this type in the history of the world’s financial markets⁸. The announcement succeeded in stabilising the peso, but the dollar fell as a result. The resulting rise in the price of the yen in relation to the dollar caused an increase in unemployment in Japan and marches of protest in Tokyo⁹. In Europe the financial turbulence gave rise to new tensions in the process of monetary integration¹⁰.

When the political and economic leaders of the world came together in Davos in January 1995, Mexico was the principal topic of discussion¹¹; when the Group of Seven met in Toronto in February, Mexico was the principal topic¹²; when the International Monetary Fund met at the end of April, Mexico was still one of the principal topics¹³. There was much talk of the risk of a ‘systemic crisis’ of world finance, even of ‘global financial apocalypse’¹⁴ The argument advanced by the US government to defend its original proposal of support and to justify the international financial package was that the collapse of the peso was not just a Mexican or an American concern, but that it put at risk the stability of the international financial system as a whole.

II The world financial system did not collapse, has not collapsed. Popocatépetl did not erupt, has not erupted.

And yet the incursion of Zapata into Wall Street is relevant to the theme of the meaning of politics at the end of the twentieth century, for it involved the sharp confrontation of two worlds, two conceptions of politics, two ideas of reality and of realism. On the one hand, the naked, undisguised power of money, of capital in movement, of the states and all their energies brought to focus on ensuring the reproduction of capital. On the other hand a beautifully executed piece of mischief, a mockery, a cry of dignity, the ‘Here we are!’ of a world that refuses to be extinguished, of a world that does not yet exist. The prevailing concept of reality was challenged just as surely as though the ghost of Zapata had physically ridden onto the trading floors of Wall Street.

The incident poses conceptual problems for the way that we think about politics. Two versions of reality present themselves here: the reality of power and the (non-, anti-, or what?) reality of dignity. Clearly there is an antagonism between them, an unsprung tension. It is a volcanic tension, a tension constantly present, a tension that could, but may not, explode. To conceptualise the volcanic tension we must go beyond the indicative mood in which political analysis is usually couched and develop some sort of peculiar negative subjunctive which points not to a certain future but to a desired possibility. To try and do this, we must begin with the indicative reality, the Is-ness of power.

III ‘I am who am, the eternal repetition’, says Power.¹⁵

On the face of it, of course, that is not true. The discourse of politics is all about change. Change is what all new governments promise on coming to office. Change is what all oppositional parties proclaim as their reason for existence.

Political change is, however, a bounded change, a change within the limits of the eternal ‘I am who am’. There is an eternal present indicative which defines reality so thoroughly that it is rarely even mentioned. That eternal present is constituted by capitalist relations of exploitation.

Politics starts from the acceptance, or rather the taking for granted, of capitalist exploitation. It is not pure forgetfulness on the part of politicians that they do not mention this: rather, it is the relations of capitalist exploitation which give rise to an apparently autonomous sphere of politics, a sphere which conceals its own progenitor but depends on it absolutely for its own existence.¹⁶

Political change in capitalist society, then, is bounded by the state’s relation to capital accumulation. The state must promote the accumulation of capital (the reproduction of capitalist social relations). Successful politicians are very aware of this: they couch their proposals for change in terms that make clear that they are good ‘for the economy’, or, at very least, not harmful to ‘the economy’. This is the central contradiction of social democratic governments. Although there are certainly different strategies that can be pursued to promote capital accumulation, some more, some less overtly brutal, it remains true that any government must do its utmost to promote capitalist exploitation, on pain of economic and political crisis.

Social scientists (whether political scientists, economists or others) are also very aware of the limits imposed by capital. Social and political analysis is carried out, in the overwhelming majority of cases, in terms which respect, without mentioning them, the overarching relations of power constituted by capitalist exploitation. The language of social science, like the language of practical politics, is in the indicative mood. The present is extended into the future and back to the past. The limits of possibility are assumed, silently.

Accepting the limits of possibility, the reality of capitalism, does not necessarily mean condoning it. Within the framework of this reality, one can quite easily point out the misery that capitalism brings, the oppression, the hunger, the misery, the violence, the horrors of a modern capitalism in which over a thousand million people live in extreme poverty, in which babies are produced for sale, in which the systematic murder of street children is the only way of maintaining respect for property.¹⁷ All of this, even all of this, can be accommodated within a theoretical framework which condemns morally, but still assumes, in stucturalist-functionalist manner, the stability of capitalism, the reality of the ‘I am who am’. So much of radical analysis, even (or especially) within the Marxist tradition, assumes the subjectivity of capital and the objectivity of labour as a starting point to be taken for granted rather than as an achievement of capital that is constantly at issue.¹⁸ The names given to the supposed structures change (‘globalisation’ is the current fashion), but all focus on the bounding of reality, the exclusion of (im)possibilities.

Within this reality, the dream of a different world must remain just that, a dream. Within this reality, moral outrage must be seen as an extra-scientific value judgment, an ‘ought’ to be opposed eternally to what ‘is’. Within this reality, the scream of rage must be stifled, in one way or in another.

In all this, money is the great watchdog of Reality. When the state transgresses by introducing some measure that is not conducive to capital accumulation, or (more oftten) by failing to control a movement that threatens the profitability of capital, then the police action comes not through law or physical force, but through the movement of money. If the conditions are not favourable to capital, then capital will metamorphose itself into money and go where the conditions are better. Capital that might otherwise have flowed into the state’s territory will go elsewhere. The flight/ flow of money sets the limits to political reality: any government, whatever its leaning, will try to avoid the massive outflow of capital which is the surest indication of the government’s ‘failure’. ‘Globalisation’, in the sense in which it is usually used, namely to indicate the increasingly tight structural limits on state action, refers to the increasingly austere police action of money which derives from the increased speed and mass of its circulation. Even more than brute force (although obviously it is supported by brute force), it is the flow of money that marks out the limits of capitalist reality, that asserts with irrefutable logic the ‘I am who am’ of Power, that encarcerates our bodies and our minds.

IV

It is through money that the Is-ness of politics is imposed. It is through the movement of money that the rationality of mass starvation comes to be accepted. That is why money must be challenged, and that is why it is exciting (and frightening) when there is a crisis of the monetary system.

But how could a monetary crisis come about? If money encloses reality, then how could that reality come to subvert money? What could make the Power of Money tremble? There must be some other reality, some reality that is not contained within Power’s eternal present.

The zapatistas are part of such a reality. Their rebellion challenges not only the power structures of Mexico, but also and above all the reality and language of politics. Theirs is another conception, one that does not assume the bounds inherent in capitalist exploitation which are enforced through money. They propose a politics of Dignity. Dignity is essentially an unbounded, anti-definitional concept. Dignity is the scream of rage that refuses to be stifled, the ought that refuses to remain suspended in the limbo of morality, the dream that struggles for its own realisation. Dignity is and is not, the present existence of the not yet, the struggle for its own realisation. The grammar of dignity is not the present indicative but a negative subjunctive, a constant tension tearing against that which Is and pulling towards that which is not but (perhaps) could be – hence the poetry and fantasy of the zapatista communiqués. If politics refers to the state-oriented and therefore bounded sphere discussed above, then the politics of Dignity is better thought of as an anti-politics, certainly the most innovative and exciting anti-politics for many years.

But, for all the power of their ideas and their discourse, it is hard to see how the action of a few thousand rebels in the jungle of south-east Mexico could precipitate a world financial crisis. Or rather: the fact that the zapatistas brought to a head the outflow of capital from Mexico that led to a world financial crisis tells us as much about the world financial system as it does about the zapatistas. To have fallen so easily into crisis, the financial system must already have been in a condition of acute fragility.

But what could have brought the watchdog of reality to such a crisis? The fragility of capitalist reality suggests that the scream of rage that is such an obvious part of the horrors of current capitalist development, our scream of rage, must somehow also be a scream of power, an effective subversion. But how?

Marx suggests, in his discussion of value, that there is a fundamental weakness at the core of capitalist strength, a contradiction that constantly subverts capital’s presentation of reality, a dependence that undermines its domination. That contradiction is constituted by the fact that labour is the only source of value, or in other words that capital depends on labour for its own production and reproduction.¹⁹ Capital will be reproduced only if it succeeds in subordinating labour. The subordination of labour involves not just the direct control of wage-labour (a notion which presupposes subordination and gives rise to a very narrow concept of class), but is much wider than that: it involves the constantly renewed transformation (degradation, humiliation, alienation, fetishisation) of human creativity into subordinate labour. Capital’s struggle to reproduce itself is the struggle to subordinate effectively, the struggle to alienate, fetishise, degrade humanity (the creativity that makes people human) into subordinate labour. Anti-capitalist struggle, class struggle, is then simply the struggle against dehumanisation and for humanity, dignity in other words, the everyday stuff of life. The so-called tendency of the rate of profit to fall can be seen, therefore, as meaning simply that as capitalism progresses, there is a tendency for the contradiction or relation of dependence to grow more intense, that capital is driven to degrade human creativity more and more into subordinate labour.

One might expect, if one follows this argument, to find that the insubordination of social practice is at the root of the instability of money. Such insubordination may be overt insubordination, as in the case of the zapatista uprising; or it may simply be the grinding, corrosive non-subordination of life to the command of capital, the chronic incapacity of capital to adequately subordinate social practice to its needs. The inherent incapacity of capital to free itself from its dependence on labour constitutes its fragility. It is this which makes it not a mountain but a volcano. Monetary instability is the smoke which shows us the intensity of the volcanic activity.

Much has been written on the embourgeoisement of the working class, the extent to which labour has been integrated within capitalism. Less has been said of its logical counterpart: the proletarianisation of capital, or, better, the growing intensity of the presence of labour within capital. Both can be linked with Keynesianism (Fordism) and its unresolved crisis.

V

The central feature of Keynesianism was the attempt to control labour through the acknowledgement and institutionalisation of its strength. The most obvious features of this were the political-institutional changes: the integration of the trade unions into the process of political decision-making and all the ‘welfare state’ reforms associated with that. But the feature which has proved most intractable, and that which was most feared by the opponents of Keynesianism in the 1920s and 1930s, was the admission of the power of labour into the regulation of money itself.

This was the central issue in the debates around the Gold Standard in the 1920s and 1930s. The reaction of the US politician Bernard Baruch to Roosevelt’s abandonment of the Gold Standard in 1933 makes the point clearly: ‘It can’t be defended except as mob rule. Maybe the country doesn’t know it yet, but I think we may find we’ve been in a revolution more drastic than the French Revolution. The crowd has seized the seat of government and is trying to seize the wealth. Respect for law and order is gone.’²⁰

What Baruch and the ‘old-world party’ (as Keynes called them²¹) were worried about was the undermining of money and of the discipline of the market through the unlimited expansion of credit. If the discipline imposed upon national governments by the tying of national currencies to the gold Standard were removed, then it would be all too easy for governments to give way to social pressures by increasing expenditure and allowing the expansion of credit. This would lead to a progressive separation between real accumulation and its monetary representation, a weakening of the currency and above all of the discipline which the market imposes on all aspects of society.

The Keynesian counter-argument was essentially that the only future for capitalism was to accept that conditions had changed and that the trade unions now played an important role. Consequently, it was necessary for governments to try to integrate the strength of the trade unions by institutionalising their demands. This required as a precondition the flexibilisation of monetary control: the acceptance of credit expansion as a principle of capitalist rule.

In a sense, both sides of the argument were correct. The strategy of ‘pacification through institutionalisation’ (Agnoli) succeeded in containing class tensions. On the other hand the price paid by capital was a very high one: a chronic monetary instability resulting from the progressive separation of real and monetary accumulation.

The separation between real accumulation and monetary accumulation can be seen as part of the ‘normal’ process of reproduction-and-crisis of capital, part of the so-called ‘cycle’ of capitalist reproduction. As a period of rapid accumulation approaches its end (as the conditions for accumulation deteriorate)²², more and more productive capitalists seek to overcome their difficulties by borrowing. More capital is also made available for lending, as the conditions no longer exist for profitable expansion through direct investment in production. Accumulation, in other words, becomes more and more fictitious: the monetary representation of value becomes more and more detached from the value actually produced. This reaches a point where borrowers are no longer able to repay their loans nor the interest on their loans: borrowers go bankrupt, banks collapse and there is a massive destruction of fictitious capital. The crisis that is unleashed destroys inefficient capitals, drives up unemployment, drives down wages, increases social discipline and generally restores the conditions of profitable exploitation and accumulation which permit the cycle to begin again.

The problem for the long-term stability of capital arises when this cyclical process of creation and destruction of credit is disturbed. This is what the ‘old world party’ warned against. And yet the Keynesian argument came to prevail: in the wake of the miseries and unrest caused by the crash of 1929, in the wake of the horrors of fascism and the second World War, in the wake above all of the Russian Revolution, it came to be accepted that that state should intervene to regulate or avoid as far as possible the destruction of fictitious capital. Keynesianism was the theoretical and practical recognition of the untold destruction that a repetition of the ‘normal’ cycle of capital would involve. In order to avoid the horrors of such a destruction, and the concomitant threat to the survival of capitalism, the expansion of credit became a permanent, rather than a cyclical, feature of capitalism²³. The accumulation of capital came to be more and more fictitious. More and more, the reproduction of capital came to depend on the maintenance and regulation of a fiction.

The problems that arise for capital from this type of development became clear in the 1960s and early 1970s. The constant expansion of credit implies above all a weakening of the discipline of the market, a weakening of the social discipline imposed by the law of value. By postponing or modifying crisis, it makes possible the survival of inefficient capitals and, even worse from the point of view of capital, the survival of inefficient workers. It also implies the autonomisation of financial markets from commodity markets. Credit feeds on credit. In order to avoid defaulting in the repayment of loans and interest, debtors need to borrow more. An increasing proportion of credit granted is recycling credit, credit granted just for the purpose of repaying loans (or, often, the interest on loans)²⁴. The more elaborate the structure of credit becomes, the more difficult it becomes to maintain, but also the more difficult to undo. A ‘credit crunch’ (the destruction of fictitious capital) would not only cause massive social hardship but also threaten the existence of the banking system, and, with it, the existing structure of capitalism.

The criticisms voiced by the opponents of Keynes in the 1920s and 1930s arose with force again in the 1970s, when they formed the basis of the monetarist or neo-liberal assault on the assumptions of the post-war development of capitalism. The monetarist critique of Keynesianism was directed against the fictitious character of capitalist development (‘funny money’, as they called it) and against the social indiscipline which the modification of the market promoted. However, the attempt by the United States, British and other governments, to impose market discipline through tightening the money supply (that is, restricting the expansion of credit), in the years 1979 to 1982, not only caused considerable social hardship and economic destruction, but also threatened to destroy the international banking system. The restriction of credit by raising interest rates in the United States created a situation in which it became extremely difficult for some of the biggest debtors (such as the Mexican, Argentine and Brazilian governments) to repay their debts or even to pay the interest due. When the Mexican government threatened in 1982 to default on its payments, thus precipitating the so-called ‘debt crisis’ of the 1980s, it became clear that the attempt to eliminate the expansion of credit threatened not only the survival of the debtors but also of the creditors, in this case the world’s major banks. The attempt to precipitate the massive destruction of fictitious capital through tight monetary policies had proved impossible to implement²⁵.

The debt crisis led to a renewed and massive expansion of credit after 1982, a credit expansion far greater than anything associated with Keynesianism²⁶. When the spectre of 1929 arose again in the stock market crash of October 1987, the response of the governments was the same: the expansion of credit and the introduction of measures to avoid at all costs a massive destruction of fictitious capital²⁷. The response to the recession of the early 1990s was the same ‘Keynesian’ response, especially on the part of the United States government: to reduce the rates of interest to stimulate borrowing, to create money through credit. In this case, however, a lot of the money created in the United States was not invested in the US but in the international money markets, and especially in the so-called emerging markets, where there were high profits to be won²⁸. The most important of the emerging markets was Mexico, where the inflow of capital in the form of money contributed to the opening of a huge abyss between the reality of the process of accumulation and its appearance, the abyss that was revealed in the devaluation of the peso²⁹. In spite of the original aims of the neoliberals, capitalism continues to be based on a separation between real accumulation and monetary accumulation, that is to say on the constant expansion of credit and debt. Public debt, for example, which was the central theme of the monetarist attack against Keynesianism, continues to expand: the OECD calculates that the net public debt of its member states increased from 21% of the gross domestic product in 1978 to 42% in 1994 (Financial Times 31 October 1994). The net debt of the European governments grew from less than 25% of GDP in 1980 to more than 55% in 1994 (Financial Times 16 January 1995)³⁰. According to IMF figures for the member states of the Group of Seven, domestic credit as a proportion of gross domestic product rose from 44.48 per cent in 1955 to 104.54 per cent in 1994. Throughout the whole postwar period, the expansion of money has far exceeded the expansion of production (check Werner): or, in other words, despite the very real restructuring of the productive process that has taken place over the last twenty years or so, the survival of capitalism is based on an ever increasing expansion of debt.

The separation between real and monetary accumulation is crucial for understanding the instability, volatility, fragility and unpredictability of capitalism today. Since the whole financial structure of capitalism is so heavily based on credit and debt, any default or threat of default by a major debtor (such as Mexico) can cause great upheaval in the financial markets: the urgency with which the international package to support the peso was put together was related to fears that the Mexican government could default on the payment of its debt³¹. The size of the US budgetary deficit (and hence of the US government’s debt) is also a major factor affecting the value of the dollar and hence the stability of currency markets³². More generally, the autonomisation of the financial markets which the non-destruction of fictitious capital supports implies the possibility of creating ever more sophisticated financial instruments of doubtful validity (the so-called ‘derivatives’); it also implies the increasingly rapid movement of greater and greater quantities of money on the world´s financial markets, and therefore a radical change in the relation between individual states and world capital³³. All this does not mean that capitalism is on the point of imminent collapse, but it does mean that the possibility of a world financial collapse has become a structural characteristic of capitalism, even in periods of rapid accumulation.

VI

The zapatista uprising takes place in a world characterised by financial instability. The question, then, is not whether the zapatista action ‘caused’ or did not ‘cause’ the devaluation. The point is rather that the fragility of the capitalist financial system is such that the zapatista action did precipitate a flight of capital which led to the devaluation of the peso, with dramatic consequences for the finances of the whole world.

Mexico was probably the most concentrated expression of the world fiction of a capitalism increasingly based on debt. In the previous years Mexico had become an important focal point of the world tension between value and its monetary representation, between the reality and appearance of accumulation. The huge inflow of (speculative) money capital into Mexico in the years prior to 1994 had bolstered an exchange rate that did not reflect the generation of profits in the country (i.e. the level of exploitation of the workers in Mexico). This inflow, however, can not be seen as a peculiarly Mexican phenomenon: rather it was just one expression of the separation between money and production at the world level. The separation between money and production means precisely that: that the money will flow to the part of the world in which it has good prospects for rapid expansion, irrespective of the productive base. The autonomisation of the financial markets implies that the gap between money and production will be concentrated with particular intensity in one part of the world (or one particular currency) or another. The fictional basis of capital accumulation is worldwide, but its geographical impact is constantly shifting with the spatial flow of capital. In the years before the devaluation, Mexico had become one of the most important centres in the world of the tension implied in the fictional base of accumulation. The bursting of the bubble in Mexico does not mean an end to that tension, but simply that it moves on to somewhere else.

The fact that the country which was one of the most fragile points in the world financial system was also the location of one of the most important revolutionary movements in recent years is not mere chance. The Mexican state’s policy of encouraging the inflow of capital in whatever form was part of its attempt to overcome its declining legitimacy. The more manifest the instability of the political regime, particularly after the 1st of January 1994³⁴, the more desperate the measures taken by the state to maintain the flow of capital into the country³⁵. In other words, although it is not necessarily the case, the rise of political insubordination, far from frightening capital away in the first place, may generate, through state policies, conditions that are particularly favourable for the short-term expansion of capital. The more unstable a political system, the greater the lengths it will go to to attract the inflow of capital necessary to bolster its position; the more desperate capital is to find a means of self-expansion, the more likely it is rush into risky situations, in the hope that it will be able to get out again before the crash comes. In a capitalist system increasingly dependent on the expansion of credit (and on the autonomisation of the financial system that such a development implies), there will be a tendency, at least, for radical insubordination (or revolutionary activity) and the most vulnerable points of the world financial system to coincide. The link between the zapatista action of the 19th December and the ‘systemic risk’ to world capitalism is not just a one-off event, but suggests a growing interconnection between rebellious or revolutionary activity on the one hand and the financial instability not just of particular countries but of world capitalism³⁶.

What are the implications of this coming together of revolutionary activity and monetary instability? The link between the zapatista action and the monetary instability can be understood in two quite different ways. It can be seen as a remarkable display of the power of insubordination: the action of rebels in the jungles of Chiapas leads to political instability in Japan, etc. It can also be seen as a remarkable display of the power of capital: money and its turbulent movement appears to impose severe limits on what can be achieved within any national (or otherwise territorially defined) area. Both understandings are correct: both moments are present, the power of insubordination and the power of capital. Since the future of the world (and in this moment the future of Mexico) is being played out in the interplay of these two moments, it is worth focusing on each of them before returning to the question of their interrelation.

VII

The zapatistas frightened capital away. Capitalists do not like insubordination. They do not like struggles that put the security of their investments at risk. When profits are threatened by insubordination, capital flees. When the government linked the devaluation of the peso to the action of the zapatistas, it was not simply a ploy to discredit the zapatistas: its basis was the fundamental and obvious point, that human dignity and capital are mutually incompatible. The devaluation resulted from the fact that capital fled from the zapatistas’ dramatic act of insubordination.

Capital might not have fled from Mexico if conditions otherwise had been such as to offer good prospects of profit. The flight of capital from the zapatistas revealed that there was a more general problem for capital in Mexico, namely that labour in Mexico was not productive enough to generate the sort of profits that would entice capital to stay in spite of the zapatistas. The flight of capital laid bare the inadequacy of the exploitation of labour in Mexico, the inadequacy of the subordination of labour. The flight of capital made clear the continuity between the open subordination of the zapatistas (and others) and the inadequacy of the subordination of workers more generally in Mexico to the demands of capital. (Hence the importance of parties and dancing in the zapatista discourse: parties as the symbol that we are still human, that we have not (yet) been reduced by capital to total subordination).

Capital was frightened away by the zapatistas, but it was fleeing from the combination of the insubordination and non-subordination of labour in Mexico: its flight expressed the unity of the antagonism of labour (overt and latent) to capital. It ‘re-composed’ labour, brought together resistances to capital that had appeared to be separate.

This recomposition took place in the first instance in the area defined by the currency, the Mexican state. However, the flight of capital quickly became a much more general flight from countries in which the conditions of profitable expansion did not seem sufficiently secure. The specific fright of capital provoked by the zapatistas was turned into a much more general and ill-defined fright. Capital fled towards ‘quality’, and away from all those areas in which the combination of insubordination and non-subordination appeared to threaten the security of profits. In many cases the condition of budgetary deficits was taken as the measure of the stability of capitalist control. In the case of Sweden, for example, the flight of capital was prompted by the government’s inability to reduce its budgetary deficit, which in turn reflected the strength of popular resistance to cuts in welfare provision. The world-wide ‘flight to quality’ provoked by the zapatista action was a flight from all those countries in which the combination of insubordination and non-subordination (real or suspected) put the exansion of capital at risk. The recomposition of labour, or bringing together of resistances to capital that had appeared separate, was thus not just within Mexico, but took place throughout the world. The devaluation of the Swedish korona, for example, resulted not just from the struggle of workers and welfare recipients in Sweden against the cuts in the welfare budget, but from the coming together of these struggles with the flight of capital provoked by the zapatistas. The financial crisis in Sweden thus expressed the unity of the struggles of the zapatistas in the Lacandona Jungle and those of single parents (say) in Stockholm.

The relation between the zapatista action and the turbulence of the world’s financial markets is not an external one. It is not that the subjective action of the zapatistas takes place in an objectively unstable structure. Rather, the extent of the turbulence and financial instability indicates the extent of insubordination and non-subordination throughout the world³⁷. The zapatista action punctured the fiction of subordination not only in Mexico but throughout the world.

The puncturing of a fiction, in a world in which capital accumulation is increasingly based upon a fiction, is central to the ‘uniting of dignities’, to any recomposition of labour. The idea of exposing a fiction, of attacking an untruth, has been central to the zapatista discourse from the beginning. Dignity and truth have been put forward as the central values of the rebellion. The word of the EZLN is, they say, the word of those ‘armed with truth and fire’. The wearing of the mask is a way of making themselves seen and drawing attention to the fact that it is the other side, the side of Power, that hides behind a mask of falsehood. The lesson that the technocrat-politicians have learned in their postgraduate studies abroad is always the same: ‘”Pretend that you know what you are doing”. “This is the fundamental axiom of the politics of power in neo-liberalism”, their master has told them. They ask “And what is neo-liberalism, dear teacher?” The master does not respond, but I can deduce from his face of perplexity, his reddened eyes, the saliva dribbling though the cracks in his lips and the obvious wear of his right sole, that the master does not dare tell his pupils the truth. And the truth is, as I discovered, that neo-liberalism is the chaotic theory of economic chaos, the stupid exaltation of social stupidity, and the catastrophic political implementation of catastrophe‘.³⁸

The wave of monetary turbulence set off by the zapatista action is thus the integration of the zapatista insubordination into the in- (and non-) subordination of the world. That this wave of insubordination³⁹ was seen as creating a ‘systemic risk’ at a moment when anti-capitalist struggle is so often proclaimed to be dead is eloquent testimony to the fact that insubordination is very much alive and shaping the world far beyond the confines of the Lacandona Jungle. The monetary resonance of the zapatistas is just part of the extraordinary resonance of their cry of “¡Ya basta!”.

The most important thing about the world financial instability that flowed from the zapatista action of the 19th December is that it was a dramatic illustation of the enormous power of insubordination (and non-subordination) of labour (human dignity, in other words⁴⁰) throughout the world. This should be shouted from the rooftops, again and again and again.

VIII

The zapatistas shook the financial world. But nobody shouted “Bravo! Bravo! More! More!” Why not? Because the flight of capital from the zapatistas was simultaneously a counterattack by capital. The same instability that shows the power of insubordination also shows the power of subordination. If insubordination showed its power by frightening capital away, capital showed its power by fleeing.

The flight of capital from the zapatistas and from the general inadequacy of the subordination of labour in Mexico has had a dramatic effect on the living standards of most people in the country. Official figures for unemployment rose by over a million. Prices rose by 35% in the first seven months of 1995, according to official figures, while salaries rose by only 10%. Indices of suicide and violence rose sharply. The number of people living in extreme poverty rose by x%.⁴¹

In some ways the flight of capital has been a more effective display of the power of capital against insubordination than any military intervention. Rates of exploitation have risen sharply. It is hard to know how many people have died as a result of the flight of capital, but presumably more than have been killed by direct military action against the zapatistas since the beginning of 1994. The movement of money has acted with particular ruthlessness as capital’s ‘police force’⁴².

The flight of capital makes clear the reality of a society in which the production of material wealth is based on the subordination of labour. In such a society, insubordination brings material costs. In a society based on the crushing of dignity, the proclamation of human dignity means material loss. It is not so much administrative action that imposes these costs as the simple movement of money: money moves away from insubordination, away from the proclamation of dignity. This is what makes a national revolution, or indeed a ‘national liberation’ very difficult to imagine. Either the state in question tries to make itself attractive to capital, in which case there is no revolution or liberation at all, or else considerable material loss results. The only way in which the antagonism between money and liberation could be overcome would be through the liberation of the entire world, that is, the abolition of money.

It is now clear why nobody shouted ‘More! More!’ when the zapatistas frightened capital away. The movement of money confronts the zapatistas with two major obstacles. Firstly, it would be very difficult for them or their supporters to say openly that their action had brought material loss to the people of Mexico. Secondly, it is difficult for a movement that presents itself as one of national liberation to say that national liberation is a chimera, that the only possibility is world liberation (although their political practice has become increasingly oriented towards world liberation). However, if it is not said that the flight of capital is the expression of power of insubordination, then there is a danger that the movement of capital appears as unavoidable necessity, a law of nature to which one must submit. The wave of monetary turbulence in the world then appears not as the monetary expression of a wave of insubordination but as a series of national problems, the result in each case of mistaken economic policies or the weakness of governments in conceding too much to social pressures. If the movement of money is not confronted as the expression of the world power of the enemy, capital, then the only possibility is to bow to the great principle of capitalist rule in the 1980s and 1990s: There Is No Alternative.

The world monetary turbulence, then, not only recomposes labour: it simultaneously decomposes it. Like a great flash of lightning, it shows the interconnections and then leaves us in a more profound darkness than ever. The flight of capital to ‘quality’ establishes a unity between struggles in different parts of the world, but it does so in a form that simultaneously conceals (or fetishises) that unity. While it is certainly true that the devaluation of the Swedish krona results from the combined impact of the action of the zapatistas and the struggles of welfare recipients in Sweden, the form in which the unity of action is established simultaneously makes the connection invisible. Money divides in the process of uniting. Within Mexico too, the devaluation is the combined result of the insubordination of the zapatistas and the in- and non- subordination of labour in general, but it does not appear as such. On the contrary, the devaluation presents itself as the intervention of a cruel reality, which must be accepted, making struggle pointless.

The monetary response to the zapatista action is at least as violent as a direct military response. The political effect, however, is very different. Money is a far more effective weapon for capital than brute force. Where the open military intervention of the first days of January 1994 and of the 9th of February 1995 had the effect of stimulating struggle against the government in Mexico and throughout the world, the effect of the monetary assault has been, tendentially at least, to weaken struggle. Money has always been the principal form of capitalist rule, military force its uncouth henchman. But that is now more true than ever. Neoliberalism is the naked rule of money, a rule so effective, so violent, that military dictatorships have become increasingly redundant: the violence of the everyday, ‘democratic’, policing to enforce respect for money is sufficient⁴³. To attack neoliberalism (not a policy, but the capitalism of the late twentieth century) is to attack the rule of money: not of the banks, not of a group of finance capitalists, or of a political party or clique, but of money. Until money (capital in money form) is attacked, no military seizure of power, no electoral victory will eliminate its violence. Until money itself is attacked, no liberation, either national or otherwise, is possible.

IX

Where does all this leave us? Any reflection on the world today seems at moments to be filled with hope, more often to be full of horror. Those of us who insist on hoping, who insist on thinking that there must be some way of getting away from the horrors that confront us on every side, some way of creating a radically different world, often feel that we are screaming in a padded cell, insane and without echo. To know that we are, rather, the fire in the volcano gives us no certainty but it does give substance to our hope.

The first conclusion is that the reality of capitalism today is an increasingly vicious reality, within which political options are more and more restricted, and more and more tightly policed by the movement of money. Within this conclusion, there is ample room for debate on just how much space is left to the national state to exercise its ‘sovereignty’, but the general conclusion seems inescapable. The narrowing of options, the foreclosure of possibilities, the rigidity with which Reality is imposed find expression too in the discussions of social scientists and in the everyday practice of universities, with which we are all familiar.

The reality of capitalism is, however, a volcanic, fragile reality. Its fragility is concentrated in the fragility of the world monetary system: a frgility that is grounded in the increasingly fictitious character of capital accumulation. Lipietz poses the issue strikingly in terms of an ‘image which has been haunting me since the crisis began – the image of a cartoon character who has gone over the edge of a cliff and carries on walking on thin air. This seemed to me to illustrate the position of the world economy, which continues to work “on credit” while the actual ground on which post-war growth has been based … crumbles beneath it’⁴⁴ (Lipietz 1985, 5). Lipietz himself is concerned to ensure that the character does not go ‘crashing into the abyss’ (7). Certainly that has been the main preoccupation of international economic policy coordination over the last twenty years at least. At times the salvation of the cartoon character has been envisaged in terms of setting his ‘feet back on solid ground’ (7): that was what was attempted by the pursuit of tight monetary policies before the ‘debt crisis´of 1982. This caused both enormous hardship and almost sent the character into the abyss. More often, saving the character has been understood in terms of keeping the character afloat through the increased expansion of credit. The international bail-out of the peso with $50 billion dollars is just the latest spectacular example of this policy. The problem with this approach is that it reproduces the fragility and volatility of capitalism on an expanded scale, together with all the misery and starvation that accompanies it. The so-called discipline of the market is increasingly mediated through the arbitrary (and corrupt) state regulation of punishment, as the state (or states) choose which debtors should suffer annihilation (either as companies or as physical people) and which must be saved in the interests of keeping the cartoon character afloat, in accord with the “too big to fail doctrine”⁴⁵.

But what do we want to do with the cartoon character, we who hope for a different world, we who are screamed at by the horrors of the present? Do we put its feet on the ground, keep it afloat or send it crashing into the abyss?

Push it into the abyss.

There is no other way to imagine the end of capitalism and the beginnings of a society in which human existence is not ruled by the god of money. Movements which aim to transform society radically will always provoke monetary upheaval as capital flees and counterattacks-by-fleeing. Revolutionary attacks on capital will always provoke tremors that appear to be internal to capital. The only possible way of thinking about a revolution is in terms of capitalism being eaten from the inside as it is eaten from the outside: monetary instability joining with overt revolutionary action to produce change.

But would monetary collapse not bring about the barbarism of which socialists have always warned? Is the barbarism of collapse the only alternative to the barbarism of capitalism?

The quotation that stands at the beginning of this paper suggests another option. Marcos suggests there that it is the ‘uniting of dignities’ that has the capacity to bring about the downfall of money, ‘its rapid transition to part of a nightmare that is coming to an end, the conclusion of a historical phase ruled by arrogance and stupidity’. The argument in this paper has been that it is indeed the ‘uniting of dignities’, or, in other words, the in- and non-subordination of labour, that is behind the instability of money. It is this uniting of dignities which makes it possible to conceive of a safety net which would prevent humanity crashing into the abyss with the cartoon character, Money.

The uniting of dignities has not taken the form of the development of a world revolutionary party, as envisaged by revolutionaries in the earlier part of the century. It is now clear that the myriad ways in which people fight for their humanity will not let themselves be so easily defined, and that the ‘uniting’ of their dignities is a far less structured and far less visible uniting than had previously been foreseen. Rather than the discipline that a party requires, it seems far more realistic to think of the ‘uniting of dignities’ as a ‘network of voices that, in the face of the deafness of Power, chooses to speak to itself, knowing itself to be one and many, knowing itself to be equal in its aspiration to listen and make itself heard, recognising itself to be different in the tonalities and levels of the voices which form it…; a great bag of voices, sounds that seek their place fitting with others…; the world in which the sounds can be heard separately, recognising their specificity, the world in which the sounds can be included in a single great sound…; the world with many worlds which the world needs.’⁴⁶

Politics in this era of globalisation, this end of the twentieth century, is about what it has always been about: class struggle, the reproduction of domination, the suppression of alternatives to capitalist reality. Anti-politics has gained a clearer focus in the aftermath of the zapatista uprising. It is the struggle for dignity: the struggle against exploitation, the struggle to be human, the struggle for humanity, the struggle to lead a life that is not fragmented into the public and the private, the political and the non-political, the struggle not to take power but to dissolve power. The struggle for dignity implies the recognition of the dignity of others, and hence the impossibility of an instrumental or definitional concept of revolution. It implies a concept of organisation which is radically democratic in its decision-making: hence the zapatista principles of ‘command by obeying’ (mandar obedeciendo) and ‘asking we walk’ (preguntando caminamos). It implies a revolution which is not just a means of making the transition from the present to the future but is the present negation of capitalism which our struggle to be human involves. This may seem insane, as it always has done to politicians and their theorists, just as the totally absurd uprising of the zapatistas on the first of January 1994 was insane.

And yet they made the Power of Money tremble. And yet they made the volcano belch forth smoke and ashes.

Asking we walk. Preguntando caminamos.