Back in the 1830s, Thomas Peel decided to migrate from England to the Swan River in Western Australia. A man of means, Peel took along, besides his family, ‘300 persons of the working class, men, women, and children,’ as well as ‘means of subsistence and production to the amount of £50,000.’ But soon after arrival, Peel’s plans were in ruins.
The cause was not disease, disaster, or bad soil. Peel’s labour force abandoned him, got themselves plots of land in the surrounding wilderness, and went into ‘business’ for themselves. Although Peel had brought labour, money, and physical capital with him, the workers’ access to alternatives meant that he could not bring capitalism.
Karl Marx recounted Peel’s story in Capital, Volume I to make the point that ‘capital is not a thing, but a social relation between persons.’ The parable remains useful today in illuminating not only the difference between money and capital, but also why austerity, despite its illogicality, keeps coming back.
For now, austerity is out of fashion. With governments spending like there’s no tomorrow—or, rather, to ensure that there is a tomorrow—fiscal spending cuts to rein in public debt do not rank high among political priorities. US President Joe Biden’s unexpectedly large—and popular—stimulus and investment program has pushed austerity further down the agenda. But, like mass tourism and large wedding parties, austerity is lingering in the shadows, ready for a comeback, egged
— source yanisvaroufakis.eu | Yanis Varoufakis | 20/05/2021