Reluctance at Reveille

The global industrial revolution being engineered by multinational firms and the dismantling of international trade barriers have produced wrenching social changes and will unleash more. Rolling Stone National Editor William Greider, author of Secrets of the Temple (on the Federal Reserve) and Who Will Tell the People (on contemporary politics), here surveys global capitalism and its "contradictions," and offers reforms to rectify them.

Greider's central message is a "reasoned warning": global capitalism "appears to be running out of control toward some sort of abyss." While technological progress propels capitalism's global revolution, its "dirty little secret" is its tendency to depress a firm's rate of return per unit of output. Driven therefore to reduce costs, capitalism is shifting production to low-wage countries—simultaneously creating excess capacity and supply and suppressing demand. Hence it is haunted by the possibility of a crisis of overproduction, and the more it cuts costs at labor's expense, the more likely the crisis becomes. Finance capital, "the Robespierre of this revolution," churning from country to country, destabilizes things further.

The cost-minimization drive is creating "tax arbitrage," whereby firms play cities, states, and even nations off against each other, locating where tax breaks...

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