HISTORY is a corrective of ideas, serving as a reality check on intellectual inflation. Sometimes it takes years, decades, even centuries for big and even not so big ideas to be properly deflated.

I remember fondly many heated arguments with the late Fred Gaboury, a former union logger from the north-west United States, who became an organiser for Trade Unionists for Action and Democracy, editor of Labour Today and World Federation Trade Union representative to the United Nations. Fred was a serious thinker in ways that many of his contemporaries missed.

When the eurozone — the European monetary union — was about to be established, I argued that between nationalism and uneven European development, a common currency was not sustainable. Posthumously, I conceded to Fred. But, today, there is plenty more reason to doubt the eurozone’s future sustainability. History has yet to speak definitively.

As a retired worker, Fred followed trends in production and distribution closely. Me, not so much. When business writers began to herald modularisation and just-in-time inventory production, Fred saw it as the next big thing, a profit-driven structural adjustment set to change the course of global capitalism.

With my usual knee-jerk scepticism, I argued that it was just a passing gimmick, something for the TV pundits to talk about. In any case, I argued, it would prove to be unworkable and ultimately disruptive to the production process.

Decades later, it seems that I was both wrong — and possibly, right.

Wrong, because just-in-time distribution became a dominant mode with global supply chains. Virtually all production and distribution organised by monopoly capitalist enterprises moves products through their processes with none of the traditional back-up supply. There are no full-to-capacity warehouses filled with widgets for “just-in-case” scenarios or unanticipated shortfalls. That thinking has been rendered obsolete.

For the most part, the system works well, saving monopoly capitalism billions in costs. It works… until it doesn’t!

History is speaking.

The pandemic brought the “efficient” system to its knees, demonstrating just how fragile this big idea actually is. The disruptive factor of massive layoffs, consumption declines, volatile production and unanticipated imbalances today make lean production and instantaneous distribution look like genuinely bad ideas.

Just-in-time has been replaced with never-in-time, as bottlenecks, late arrivals and displacements choke off consumption.

Shortages abound. Capitalist markets respond to shortages with higher prices. But it is not only material commodities, but also labour “commodities” that are in short supply and commanding higher “prices.” Labour costs rose by 8.3 per cent in the third quarter of 2021 (reflecting a 2.9 per cent increase in hourly compensation and a 5 per cent decrease in labour productivity, due largely to longer hours from the existing workforce).

Workers sent home over the pandemic have been reluctant to return to work, whether it is from fear of infection, withdrawal from the rat race, or a sophisticated understanding of the gains possible from the withholding of labour. The result is a competition for labour, with capital offering bonuses, benefits and higher wages to entice a shrunken labour market.

Labour compensation is now breaking through imagined barriers that restricted hourly wages to near flat growth for nearly half a century in the US and sapped the political will to advance the minimum wage.

One can only hope that the complacent, risk-averse labour leadership will learn a valuable lesson about the advantages of workers withholding their labour, a grand idea that deserves to be revisited.

While it is true that union workers are also on strike for better compensation (though with a frequency and volume well below that of a few years ago), it is clear that labour’s top leadership is cheering union militancy from the sidelines.

Despite the assurances of those who believe that inflation is a thing of the past, manageably through Central Bank manipulation, rising prices have returned and returned with a vengeance.

After a long period of rescuing deflated financial values with central bank purchases of overvalued assets, after a lengthy regimen of ultralow interest rates designed to provide nearly free money to reviving risky or marginal investments, funding mergers and acquisitions, initial public offerings and open-ended Special Purpose Acquisition Companies (SPACs) and generally overcoming post-crisis inertia, the central banks have seemingly overshot their targets.

They have overloaded a deflated and deflationary economy. October’s inflation rate of 6.2 per cent reached a 31-year high, topping 5 per cent for the fifth straight month.

Put simply, the effort by central banks to energise a sluggish economy has created inflation, amplified by supply shortages and a labour force growing at a snail’s pace.

Those living below the highest quintile — the home of the bourgeoisie and the petty bourgeoisie — are seeing any material gains from workers’ advantages in the labour market erased by higher prices. And of course those on fixed incomes — the poor and elderly — are hurt the most.

More bad ideas coming home to roost.

It’s safe to say that the Democratic administration, through its own courtship of monopoly capitalism, finds itself caught between the sharp blades of a scissors. On one hand the party has pledged to provide a constantly shrinking, minimalist, but sorely needed relief package to a major section of its base.

On the other hand promiscuous spending on managing the empire — military and security services, foreign meddling, corporate giveaways, reflating or isolating capitalist flotsam and jetsam and the tax coddling of the rich — result in the risk of any future essential spending on human needs becoming inflationary. Crowding out relief for the masses while partnering with monopoly capital is the signature of state-monopoly capitalism.

The return of inflation has quieted the idealist-left’s infatuation with Modern Monetary Theory (MMT), the notion that spending on peoples’ needs could come at no cost to the bourgeoisie, its minions and the bloated capitalist state.

Adherents saw the massive spending on resuscitating crisis-ridden capitalism with no apparent serious effect on prices and concluded that the same kind of spending could support social welfare programmes with no inflationary consequences.

They overlooked the context. Massive Federal Reserve spending took place to address a profoundly deflationary systemic crisis.

From the MMT perspective, it is not necessary to curb insane military spending or tax the rich. Waving the magic wand of MMT will permit solving all of capitalism’s irrationalities and injustices, while meeting the people’s needs through deficit spending. Candide’s best of all possible worlds is in the MMT theorist’s grasp.

The harsh reality of inflation upends this utopian dream. Another bad idea dashed.

If it seems like the US left is addicted to bad ideas, it’s because most of the think-tankers, academic gurus and labour polemicists that influence the broad left deny that gains for the majority come from a zero-sum game — the wealthy and powerful must lose for the rest of us to win.

They pretend that there are roads to social justice that pass through regions of social harmony and equitable sacrifice, a long-held principle that keeps people in the Democratic Party orbit. They look for shortcuts that will avoid a direct confrontation — class struggle — while still challenging capitalism’s privilege to dictate human affairs. When, in fact, we must challenge its very existence.

This misguided approach guarantees that bad ideas steeped in idealism will dominate — ideas that promise success, without pain or confrontation.

MMT will not magically solve the problem of inequality; a chain of co-ops will not defeat monopoly capital; and two-party theatrics will not establish real democracy.

We need bigger and better ideas for those tasks.

With a near future of a crippling price rise motivated by exploding profits, a do-little political stratum obsessed with fund-raising and securing the approval of the rich and powerful and a murderous, gangster foreign policy motivated by service to global capitalism, we can’t afford the luxury of toying with bad ideas.

Zoltan Zigedy is a Marxist-Leninist writer whose work can be found at www.zzs-blg.blogspot.com.