Roubini, whose predictions of the financial crash of 2008 earned him thenickname “Dr. Doom,”has referred his patients to a specialist in capitalist crisis: Dr. Karl Marx.
In an interview with the Wall Street Journal, Roubini said:
Karl Marx had it right. At some point, capitalism can destroy itself. You cannot keep on shifting income from labor to capital without having an excess capacity and a lack of aggregate demand. That’s what has happened. We thought that markets worked. They’re not working. The individual can be rational. The firm, to survive and thrive, can push labor costs more and more down, but labor costs are someone else’s income and consumption. That’s why it’s a self-destructive process.
For several hours on August 12, theJournalwebsite ran the video of the interview as a top story, under the headline, “Roubini: Marx was Right.”
Considering that the first edition of Marx’s three-volume masterwork Capital appeared in 1867, Roubini’s revelation isn’t exactly news to socialist opponents of capitalism. But given the intractable nature of the current crisis—a deep global recession, a weak recovery in the traditional core of the system in the U.S. and Europe, and now the possibility of a lurch into a second recession—mainstream, or bourgeois, economics has been exposed as ideologically driven and incapable of offering solutions.