Capitalist “Externalities” – A Failure To Face Its Immanent Contradictions

Capitalists, like individuals, have defense mechanisms to keep them from facing capitalism’s self-generating problems. One defense mechanism is “business cycles” – a capitalist euphemism for avoiding the fact that some turbulence accumulates and is irreversible. Another defense mechanism, addressed by Michael Roberts in his blog, is “externalities”. This is where capitalists pretend that the system was humming along just fine, until something completely unconnected to capitalism interferes. Here capitalists blame bad weather, draughts or political instabilities to avoid facing the fact that their system is foundationally crisis-prone.