Overview of the Wallenberg Sphere
Image: Knut and Alice Wallenberg
We will now describe one of the most influential financial families in Sweden—their history, how they operate, and how they preserve their wealth. We will also use the Wallenberg family as a practical example of how state monopolism is exercised as part of Swedish imperialism.
For over 150 years, the Wallenberg family has held key positions in industry, politics, banking, and other lucrative sectors. According to a 2018 report by the think tank Katalys, the Wallenberg sphere controls nearly 2,000 billion kronor (approximately 40% of the total value of the Stockholm Stock Exchange!). To trace the development of this vast monopoly over which the family reigns, this article will review some of the activities of previous generations (and here it may be a bit difficult to keep track, as many of them, in keeping with customary dynastic practices, share the exact same name). The focus, however, is on describing the Wallenberg family’s current position of power.
As mentioned, two names recur throughout the history of the Wallenberg family, and to make things easier for the reader, we will now introduce all the different Marcus and Jacob Wallenbergs mentioned in the text:
- Marcus Wallenberg senior (1864 – 1943)
- Marcus Wallenberg junior (1899 – 1982)
- Marcus Wallenberg den yngre (1956 – ?)
- Jacob Wallenberg (1892 – 1980)
- Jacob Wallenberg junior 1 – Current chairman of Investor and the Confederation of Swedish Enterprise (1956 – ?)
- Jacob Wallenberg junior 2 (1992 – ?)
This article is based primarily on information from printed sources, which means we are limited to a broad overview. Not even the formal power expressed through wealth, board positions, executive roles, and the like has been fully depicted. Unfortunately, we will not be able to describe the entire real power struggle behind the scenes—which determines who decides what and how, which groups trample on others and move forward, and which ones are crushed in the fierce battle over who gets to be the boss—as thoroughly as would actually be necessary. The facts we are about to present, however, will expose the immense power concentrated in the hands of a few magnates in capitalist society.
The development of the monopoly
a) Banking operations
The history, current activities, and influence of the Wallenberg family in Swedish society are so closely intertwined with Stockholms Enskilda Bank (the predecessor of the Wallenberg-owned banking giant SEB) that the family and its bank should really be considered together. The relationship between them can be explained by the fact that the Wallenberg financial family uses the bank as a base from which to venture into industry. It is with the bank as their starting point that they then found or acquire a number of the country’s leading large companies, such as: ASEA (now known as ABB), Electrolux, Ericsson, SAAB-Scania, Svenska kullagerfabriken (SKF), and so on. In a letter from 1900, Marcus Wallenberg Sr. wrote the following, which provides a telling description of the family’s position regarding the bank:
”“You are aware of the bank’s character as a family institution. The Wallenberg element must remain predominant there as long as there are members of this family who are suited to business.”
The first financier in the Wallenberg family—a line of priests and bishops—was André Oscar Wallenberg (1816–1886). In their family biography, André is described as “the pioneer of the Swedish banking system.” He began his business career in Sundsvall, where he helped found the Sundsvall and Hudiksvall branch banks, before going on to establish Stockholms Enskilda Bank in 1856. André was actively involved in political life. He served on the Stockholm City Council and later as a member first of the House of the Burghers and later of the First Chamber. He was also a member of the Banking Committee and exerted significant influence on banking legislation.
In the early years, Enskilda Banken managed its finances primarily by purchasing government bonds related to, among other things, railroad construction for ore transport. In the late 1870s, an economic crisis struck, causing railroad expansion to decline drastically on top of reduced demand for key Swedish exports such as lumber and iron. As a result, the railroad companies became unable to pay their interest, while Wallenberg was unable to sell the bonds. Despite this situation, Wallenberg—through his close ties with then-Finance Minister Gripenstam—was able to secure a full-scale government bailout for the bank, which meant that the National Debt Office lent 23 million Swedish kronor (equivalent to approximately 1.57 billion SEK today) to establish a railway loan fund through which Enskilda Banken could pledge its bonds as collateral, thereby stabilizing the bank’s finances. This enabled major investments in industry, including the acquisition of AB Atlas and ASEA, both of which were able to quickly amass wealth by winning government contracts for the expansion of the railway and electrical grids, respectively, throughout the country.
In Marcus Wallenberg Jr.’s own words, this is described as follows:
”Stockholms Enskilda Bank underwent a complete transformation in this regard, attracted large deposits by the standards of the time, and began financing industrial operations. Since then, it has largely been through the Swedish banks that Swedish industry has been able to secure financing.”
However, the change described by Marcus Wallenberg Jr. is not in itself linked to the founding of Enskilda Bank: it was a general trend in the development of commercial banks in Sweden, as well as in other capitalist countries. This complete transformation was directly linked to the then-new industrial phase in the capitalist development process, which demanded entirely different contributions from the banking system than before.
The emergence of a domestic industry required large capital investments in new factories, mines, and so on. The ever-increasing scale of industrial activity, in turn, led to a constantly growing need for invested capital, hence the need for a “new” type of bank.
Commercial banks accounted for a large part of the mobilization of the monetary capital necessary for capitalism, which was accumulated in various parts of society. But at the same time, their own position within the capitalist process underwent a change. Swedish banks underwent the same transformation as commercial banks in other countries: ”from modest middlemen into powerful monopolies having at their command almost the whole of the money capital of all the capitalists and small businessmen and also the larger part of the means of production and sources of raw materials in any one country and in a number of countries.” (Lenin)
b) Government intervention in the economy to accommodate the growing role of the banks
To establish its position as a “new” type of bank, the company relied on government intervention to the greatest extent possible. Over the next generation, the Wallenbergs evolved into one of the most powerful financial families in the country through a combination of financial and political activities. André Oscar’s son, Knut Wallenberg (1853–1938), became CEO of the bank in 1886 and served for many years as a member of the Stockholm City Council and the First Chamber. Knut Wallenberg served as Minister of Foreign Affairs in the government from 1914 to 1917. His brother, Gustaf Wallenberg (1863–1937), began his career at the bank, served as a member of the Second Chamber from 1900 to 1906, and worked as a diplomat. Oscar Wallenberg (1872–1939), like the others, also worked in banking and later became CEO of the state-owned AB Svenska Tobaksmonopolet. He served on the Stockholm City Council for several years. Axel Wallenberg (b. 1874) was the Swedish ambassador to Washington from 1921 to 1926.
These positions within, and relationships with, the government would prove to be of great importance for both the domestic market and, in particular, foreign trade. The companies controlled by the Wallenberg family at that time experienced a major boom in the early 1900s and during World War I, when government agreements allowed for generous trade relations both with the West and with Russia, despite Russia’s otherwise protectionist market.
In 1913, exports to Russia amounted to only 32 million kronor, or 3.97% of total Swedish exports, but since they grew quite rapidly and were largely concentrated among large companies in the high-value-added engineering industry, they were nonetheless a dynamic factor in the Wallenberg family’s development. Russia quickly became the largest buyer of engines and machinery—especially those for agriculture—and the second-largest buyer of telephones. In the year before the war, the Russian market accounted for 28% of Swedish exports of engineering products (more than the next three countries combined!), while companies such as Husqvarna, Asea, and Atlas were in the process of establishing Russian subsidiaries and branches. The family became involved in this matter early on, primarily through the telephone industry. As early as the turn of the century, Marcus Wallenberg Sr. had hoped that this would pave the way for exports to Russia on a larger scale, while Gustaf Wallenberg, as a member of the Riksdag, submitted a motion aimed at establishing regular Swedish-Russian steamship connections. Among the clients of Enskilda Banken that established Russian branches shortly before the war were, in addition to ASEA and AB Atlas, also Nordiska Kompaniet, which for a long time conducted highly successful sales of luxury goods in St. Petersburg and Moscow.
The head of this generation of the family was Marcus Wallenberg Sr., known as “Häradshövdingen.” He began his career at Enskilda Banken and was appointed CEO in 1911. Marcus Wallenberg Sr. did not hold a seat in parliament, but nevertheless had extensive government responsibilities. In 1919, he was appointed to represent Sweden’s economic interests at the peace negotiations, which led to his participation in economic conferences in Brussels and Genoa, as well as his service as a member of the League of Nations’ Financial Committee from 1920 to 1930.
The German question also played a major role. After World War I, Marcus Wallenberg Sr. became chairman of the committee on German industrial liabilities and Germany’s payments in kind. He also served as a member of the tribunals responsible for adjudicating disputes concerning the Dawes Plan and the Young Plan (repayment plans for Germany’s war reparations following World War I). In 1931, he was appointed by the German government as an expert on the reconstruction of German banks.
In these committees, trade delegations, and the like, the state and monopoly capital collaborate in the management of the latter’s business affairs. In some cases, this intertwining goes so far that the two merge more or less completely.
c) Further expansion and monopolisation
A major turning point for the Wallenberg sphere—as it emerged and assumed an increasingly dominant role in Swedish business during the financial crises of the 1920s and 1930s—was the Kreuger crash. The Wallenbergs’ biggest competitor during this period, Ivar Kreuger—who, among other things, owned the world’s largest matchstick monopoly (250 factories in 43 countries)—went bankrupt in connection with the Wall Street crash of 1929. The Kreuger Group’s capital consisted largely of loans from American stock market speculators, and when the stock market crash hit, Kreuger was unable to repay the loans.
The Kreuger crash led to the closure of the Stockholm Stock Exchange and triggered a panic sell-off among investors, which enabled Stockholms Enskilda Bank to buy up all these panic-sold shares at a bargain price and thereby acquire significant stakes in the majority of Kreuger’s former financial assets. This was of particular importance to the Wallenberg family, as the expansion of the industrial sector through the consolidation and absorption of Kreuger companies into the Wallenberg sphere—such as STAB (since sold and renamed Swedish Match) and Ericsson—paved the way for the monopoly position we see today.
During the war years of the 1940s, the Swedish upper class—led by the Wallenberg family—was also able to play the major imperialist powers off against one another to gain advantages. Swedish imperialism adopted a “policy of neutrality” and presented itself as a “friendly” imperialist power in order to create business opportunities with every conceivable party. During this period, Marcus Wallenberg Jr. served as Sweden’s negotiator with the Western powers, while Jacob Wallenberg (1892–1980) negotiated with Nazi Germany. This enabled Sweden, among other things, to sell iron ore, ball bearings, and other goods from industries in which the family’s companies were virtually dominant. Behind this lay, among other things, the fact that Jacob was a member of the trade commission for negotiations with Germany from 1934 to 1944, and his brother Marcus served for many years as chairman of the Swedish-British Chamber of Commerce, a member of the 1939 delegation for negotiations with the British government regarding trade and shipping in light of the war situation, and, from 1939 to 1943, chairman of the Swedish representatives on the Permanent Swedish-British Commission on Wartime Trade.
During the so-called “Cold” War, the family benefited from extremely favorable government contracts and partnerships. One example is Ericsson’s partnership with the state-owned Televerket, where government investments paved the way for the company’s expansion of the telephone network throughout the country, while government resources were directed toward the development of telecommunications technology that Ericsson could later sell abroad. Another example is government contracts awarded to ASEA for nuclear power plant construction (Asea-Atom), under which Wallenberg companies built the majority of all nuclear reactors in the country. This, combined with government orders for military equipment from SAAB, meant that nearly one in four Swedish industrial workers was employed by companies within the Wallenberg sphere in 1969.
At the end of the 20th century, Wallenberg companies accounted for approximately 40% of Sweden’s total export value. If one adds up the sales figures for the companies within the Wallenberg sphere during this period, the total exceeds ninety billion dollars a year—more than that of many other monopolistic conglomerates.
The size of the Wallenberg sphere
When it comes to the relationship between a financial family’s total wealth and its influence in society, it is difficult to quantify in monetary terms or to arrive at a figure that arbitrarily illustrates the Wallenberg family’s position of power. However, all the data regarding their banking operations, foundations, and personal fortunes do provide an estimate of the approximate capital over which the family can exert varying degrees of influence—even if these estimates differ drastically depending on how they are calculated.
To make such an assessment, we must take into account the holdings of the Wallenberg Foundations, SEB’s assets, and the capital owned and managed by the bank. In addition, the control over productive assets that the Wallenberg family exercises directly and indirectly through shareholdings in other companies—including, among other things, board seats—must also be factored in. This influence extends through subsidiaries, shareholdings, joint ventures, and cartel agreements. The technique of financial capital is precisely to control capital assets many times greater than its own investment, through, among other things, holding companies, subsidiaries, and controlling stakes in shares. In this way, an investment of 100 million yields power over many billions.
Image: Overview of the ownership structure within the Wallenberg sphere.
a) The difference between A- and B-stocks
Legislation limits banks’ ability to hold shares directly. As a result, banks must establish so-called holding and finance companies (Investor, FAM, etc.), and it is through these entities that banks own or control the decisive controlling stakes in a number of Sweden’s largest companies. Holding companies are thus the most important vehicle for the banks’ ownership interests in industry. Their sole purpose is to manage ownership, i.e., shares and other securities. By establishing an extensive network of controlling stakes in the largest corporations, the banks’ holding companies can either own or control entire industries. This system is particularly well developed around the Wallenbergs’ AB Investor, which holds shares not only in its own subsidiaries but also in various individual corporations. How the Wallenbergs’ bank exercises immense control with the least possible capital investment has been illustrated by a government report on concentration (SOU 1968:3):
“Assume that 20 percent of the voting rights are sufficient to confer “working control”—that is, practical control—over a company, and that the number of voting rights is equal to the number of shares. Further assume that Person X owns 20 percent of Company A’s share capital, which in turn owns 20 percent of Company B’s share capital, which in turn owns 20 percent of Company C’s share capital. X thus controls both A, B, and C. His share of Company A’s share capital is 20 percent, of Company B’s share capital (via Company A) 4 percent (0.20 × 0.200 = 0.04), and of Company C’s share capital only 0.8 percent (0.20 × 0.20 × 0.20 = 0.008).
Suppose that the share capital of each of the three companies is 1 million SEK, for a total of 3 million SEK. In that case, X could, with a capital contribution of 200,000 SEK (equivalent to 7 percent of the company’s total share capital), gain effective control over all three companies. This can be compared to the 600,000 SEK that would be required for a direct 20 percent stake in all companies and the 1,500,300 SEK that would be required for a direct majority stake (3 × 500,100).
If there are classes of stock with different voting rights, the capital-saving effect becomes extremely significant. If X’s shares carry ten votes in all three companies, while all other shares carry only one vote, X can achieve effective control over all the companies through “pyramid building” with a capital investment of approximately 25,000 SEK. This 25,000 kronor corresponds to 0.8 percent of the companies’ total share capital. The Swedish Companies Act permits a class of shares in a company to have ten times the voting rights of other shares. For certain companies, such as LM Ericsson and SKF, the previous rules for limited liability companies still apply, which allowed certain shares to have a thousand times the voting rights of other shares.”
The system of A and B shares is the second reason for the Wallenberg family’s position of power. In Swedish companies, there are shares with different voting weights, and even if the shares pay the same dividend, an A share may carry X more votes at a shareholders’ meeting than a B share. In this way, an owner of A shares can control a company even though they own only a small percentage of the company’s shares.
One example is the telecommunications company Ericsson, in which AB Investor owns only 5.3 percent of the shares. However, since a large portion of these are Class A shares, Investor holds as much as 21.5 percent of the votes at the company’s annual shareholders’ meeting. In the massive monopoly Electrolux, the Wallenberg family owns 15 percent of the shares—but holds over 30 percent of the votes.
b) The Wallenberg Foundations
Foundations in general have become an important means not only of owning and managing large fortunes, but also of controlling interests in certain companies. At the same time, these foundations are highly secretive, and their internal structures are very rarely, if ever, disclosed to the public. The holding and financial companies mentioned above are, in turn, controlled by the 16 so-called “Wallenberg foundations” (in which family members constitute a majority on the boards), the largest of which is the Knut & Alice Wallenberg Foundation. For the family, ownership of these foundations entails the following:
Since the Wallenberg Foundations’ profits, according to their founding documents, are to be allocated to Swedish research, the foundations are considered public-benefit organizations, which means that their activities are tax-exempt. In 2024, the foundations supported Swedish research with 2.9 billion kronor, while the Knut & Alice Wallenberg Foundation increased its assets by approximately 54 billion kronor. Through these foundations, the family can also promote research closely related to the operations of Wallenberg-owned companies, for example by channeling funds into studies that benefit their areas of business.
These “public benefit” foundations have annually disbursed sums exceeding ten million to individuals within the family circle. In fifteen out of sixteen cases, the County Administrative Board verifies that the foundations’ activities are indeed “for the public benefit.” In the sixteenth case, Knut & Alice Wallenberg Foundation, however, no oversight whatsoever is conducted, as it is exempt from government oversight.
Nor does a foundation face the same risks as corporations: overvalued or undervalued corporations may be at risk of a “hostile takeover.” This means that one company buys up and takes over the operations of another company against the will of the management of the targeted company. For example, in 2006, venture capitalist Christer Gardell purchased 8 million shares in Volvo AB and then demanded that the company liquidate its assets and distribute the proceeds to the shareholders. By placing its assets in foundations, the Wallenberg sphere avoids this risk.
Another advantage of the Wallenberg foundations is that the wealth is not lost during the transfer of inheritance. The fact that the assets have not been fragmented and that the family has maintained its power across generations is not unlike a medieval dynasty.
There are, therefore, strong arguments that the foundations play an important role in the Wallenberg family’s maintenance of power in the Swedish economy. This is also noted in the government’s 1968 report on economic concentration: “With few exceptions, foundations of this kind can be assumed to have been established to make it easier for the donating family to retain control over the companies in question.”
Government intervention in economic life
”Whether a bourgeois state pursues a policy of grabbing colonies or of contending for world supremacy, a policy of free trade or of protective tariffs, every such policy constitutes state intervention in economic life, which bourgeois states have long practised in order to protect the interests of their bourgeoisie. Such intervention has played an important role in the development of capitalism.”
– More on the differences between comrade Togliatti and us, ”Some Important Problems of Leninism
in the Contemporary World”, The Editorial Department of Hongqi (Red Flag), Peking, March 1963.
Governments have always intervened in economic life to protect a certain class and its interests. The measures mentioned above to “stop” crises or “save” the monopoly capitalists from them share a common goal: for the state apparatus to make up for the declining market demand that private monopolies are increasingly unable to meet. In all capitalist countries, the state apparatus has come to play a greater economic role in this regard. The state’s most important role is to guarantee a profitable market with non-competitive production and highly favorable terms, including as a buyer of the monopoly capitalists’ products.
A particularly clear example of this can be seen in the context of Sweden’s military buildup. Today, the Wallenberg family is raking in profits through the production of military equipment. The Swedish Defense Materiel Administration is one of the most loyal customers of SAAB, which is owned by the Wallenberg family. The company has raked in billions for both developing and modernizing the Swedish military. In the final months of 2025 alone, orders were placed for, among other things, radar systems, artillery location radar, and development resources for Gripen aircraft, totaling 6.75 billion kronor. This included an air defense solution worth 2.1 billion kronor and a launch system worth 1 billion kronor, among other items.
As part of the then-current government’s fall budget in 2011, a decision was made to purchase new JAS fighter jets from SAAB for several tens of billions of kronor. The decision was crucial for the new generation of Gripen aircraft and, consequently, for the entire SAAB Group. Shortly after the announcement, the stock price rose by about 20 kronor—representing a 2 billion kronor increase in value for the Wallenberg-owned company.
Another example of the state guaranteeing this type of market is the massive mining company LKAB. The company posed too great a risk for the monopolies to take on themselves, which is why mining operations were nationalized; however, the Wallenberg sphere’s monopolies still control the business and the overwhelming majority of LKAB’s purchases. Marcus Wallenberg Jr. served as chairman of LKAB from 2011 to 2014.
To cite a few examples of the procurement monopoly, we see a 2014 framework agreement between Atlas Copco and LKAB for the purchase of drill rigs, drilling tools, and related services. We also see an agreement with ABB to install cranes in the mines, a project that was completed in 2025. Furthermore, agreements were signed with both Epiroc and ABB for various digital tools related to mining operations in 2025, and LKAB purchased measuring instruments from SKF. Through this arrangement, the Wallenberg family appropriates enormous sums from the national budget, which they, among other things, funnel on to their industrial conglomerates.
State monopolism
”State-monopoly capitalism is monopoly capitalism in which monopoly capital has merged with the political power of the state. Taking full advantage of state power, it accelerates the concentration and aggregation of capital, intensifies the exploitation of the working people, the devouring of small and medium enterprises, and the annexation of some monopoly capitalist groups by others, and strengthens monopoly capital for international competition and expansion. Under the cover of “state intervention in economic life” and “opposition to monopoly”, and using the name of the state to deceive, it cleverly transfers huge profits into the pockets of the monopoly groups by underhand methods.”.
– More on the differences between comrade Togliatti and us
We have now explained that the Wallenberg family has long acted in harmony with the Swedish state. We therefore maintain that the Wallenberg sphere belongs to the state-monopolistic faction within the imperialist big bourgeoisie. This means that the monopoly uses the state as leverage to drive economic profit. State intervention in economic life also secures capital for expansion and trade abroad, and it is precisely through this forced entry into foreign markets that the monopoly can survive and postpone the inevitable consequences of the falling rate of profit.
In an interview from a few weeks ago, Jacob Wallenberg Jr. made the family’s view of the state very clear. The discussion centered on infrastructure and how strange it is that Sweden doesn’t have a four-lane highway between Stockholm and Gothenburg. In other countries, there are toll booths where you pay to drive on entirely privately owned highways—this is the case on the European mainland and in Norway, among other places—and those countries have larger and better highways as a result. In Sweden, we only pay for infrastructure through our tax bills.
In other words, the government cannot afford to build a four-lane highway between Stockholm and Gothenburg. Government funds are insufficient, and Jacob argues that if we had this system of toll stations instead, private capital could step in to help finance the project, and then we could begin selling off highways to solve the problem of infrastructure investment when there isn’t enough government-owned capital.
The claim that the state does not have enough capital to finance major projects is a lie. This is something Jacob says in order to justify his own business activities. There is capital within the state; the problem is that there are various factions of the bourgeoisie within the state—some of whom, for example, favor the Wallenberg family while others do not—and this leads to disputes over how and where to prioritize this state capital. When the capital does not flow in the Wallenbergs’ favor and business operations are transferred to private ownership, the family seeks to outcompete them. When the family’s friends are at the helm of the state, the family is happy to sit alongside them and determine the direction.
On the other hand, he says—and this is important—if we “let politics run wild” and give politicians free reign, we would end up in a situation similar to that in France, where public debt exceeds 100% of GDP (our public debt stands at around 30%). So, according to Jacob Wallenberg Jr., we have “sound principles” in Sweden regarding state ownership.
“We’re stuck in a tradition where the government collects taxes, and the government, in its wisdom, decides how to spend that money.”
Jacob Wallenberg Jr.’s question is simple: How can we increase investment in infrastructure when there isn’t enough capital owned by the government?
The answer is just as simple: Private capital is allowed to manage and control investments in infrastructure and, for example, promise to return a certain amount to the government in the form of taxes or fee systems such as toll stations. Through this process, they have also made a tidy profit for themselves.
Jacob Wallenberg Jr. therefore has no problem with the state having full control over infrastructure or companies; as he himself says, how they charge for their services is what’s interesting. If they can’t make a decent profit on an investment, Jacob (and his friends in the Riksdag) believe that private capital should step in and “run the business” so that it generates a profit.
It is through interventions of this kind that the Wallenberg family has succeeded in strengthening and maintaining its position of power within the Swedish economy. Its relationship with the Swedish state is what has made this sphere viable, in contrast to Ivar Kreuger’s conglomerate, which belonged to the private-monopoly faction and relied on private capital and monopolies as its primary economic driving force. It is clear that the Kreuger Group was dependent not only on profits from its own operations but also on loans from Wall Street speculators to keep itself afloat. When these speculators went under during the crisis of the 1930s and no one could vouch for the companies, they were bought up by the state monopoly.
Swedish imperialism faces crises it cannot resolve
The state-monopolistic faction within Sweden’s upper bourgeoisie consists of the most powerful economic clan, which, through its capital, can use the state as a tool to secure its monopoly position against its competitors and can, moreover, plunder the state treasury and effectively transform it into its own risk and reserve capital. If its investments go poorly, it can call for state intervention; if an investment is too risky, it can obtain state financing. This means that the state-monopolistic faction within the upper bourgeoisie has even greater stakes in Swedish industry than its class counterparts, as it can dominate and plunder the state apparatus. By not openly advocating a policy of cutbacks, deregulation, and “free competition,” it can appear to be “left-wing” and thus justify its policies as “social democratic” and in the service of “the entire people” by safeguarding “the state of the entire people” —which in reality is the Swedish bourgeoisie’s apparatus of violence.
The Wallenberg sphere, as the largest family within the Swedish bourgeoisie, has influence in all parties represented in the Riksdag. However, we can see that its dominance and connections are most deeply rooted within the Social Democratic Party. For example, Jacob Wallenberg has stated on several occasions on public television that he can personally reach both the prime minister and Magdalena Andersson (whom he mentions by name) when asked by a reporter if he “has the prime minister’s number.” The state-monopolist faction is politically represented by the Social Democrats and all those who trail in their wake, such as the Left Party and a whole host of decaying revisionists who together constitute the dustbin of history. These groups praise state interventions and state-owned companies, whose efforts they believe could resolve capitalism’s fundamental contradictions.
The state-monopolist faction within the big bourgeoisie comes to the fore during periods of crisis, warmongering, and militarization. At such times, the economy must be streamlined and follow a more unified plan. This leads to the replacement of all “laissez-faire” and “business as usual” with state control and austerity measures. When the economy is struggling—which it does with increasing regularity amid the general crisis of imperialism—state intervention serves as an effective palliative. Consequently, the trend in Swedish politics is toward the strengthening of state monopoly capitalism at the expense of private monopoly capitalism.
Marxism understands that crises are the inevitable result of the inherent contradictions within capitalism that cannot be resolved. In the short term, state support for monopoly capitalists has the effect of increasing demand as they “secure” a market. But the money used to finance these state interventions does not come out of thin air. To raise the necessary funds, ever-greater tax burdens are imposed on the working class. In this way, the state drains the purchasing power of the masses and is able to postpone the crisis. For state interventions in the economy to have any impact, they must—like drug injections—constantly be increased in strength and frequency to remain effective. This means that the state is forced to increasingly curtail the purchasing power of the masses in order to inject money in the form of a “secured” market that serves the interests of private monopolies.
Nor will the other government measures be able to solve the market problem for the monopolies. The capitalist state’s solution, in fact, means that the burdens of the crises are to be borne by the working people—that is, their purchasing power is drained, leading to a sharpening of the contradiction between production and consumption (reduced demand)—hence the need for the state to once again “stabilize” the market. Some call this the “privatization of profits and the socialization of losses.”
When an economic crisis strikes the capitalist system, capitalists must begin investing in labor, raw materials, and machinery. The entire system depends on the ability to get the gears turning again. Therefore, especially during crises, the state encourages investment by offering favorable terms. However, the resulting increase in profits and employment rates is only one side of these investments. The other side is that these investments also expand productive capacity. The very nature of the upswing therefore contains the seeds of its opposite—namely, overproduction, declining investment, and shrinking purchasing power—which in turn lay the groundwork for a new crisis.
Government measures, therefore, cannot resolve the contradictions of capitalism. This becomes abundantly clear when we look at developments over the long term. The fact is that government interventions have only a minor impact on the functioning of capitalism. They can neither create an upswing nor prevent a crisis; however, they can accelerate a temporary upswing or delay a crisis.
For as long as the capitalist system of production has existed, it has also been plagued by economic crises. These crises take the form of overproduction, in which workers cannot afford to buy the goods produced, and capitalists are therefore unable to sell their goods. The fundamental contradiction in the capitalist system of production, from which these crises stem, is the contradiction between the social character of production and private ownership. This contradiction is exacerbated to the extreme by all state “crisis-fighting” measures, which are not intended to solve the core problems of the crises but merely to patch up the symptoms.
To put an end to all of capitalism’s economic crises once and for all, the prevailing order must be overthrown, and the capitalist system of production must be uprooted in its entirety. This is an urgent necessity. As capitalism’s fundamental contradictions intensify, so do all other contradictions within capitalism, and this means that future economic crises will be even greater and even more devastating than those of the past. If the capitalists cannot escape economic crises by other means, they will attempt to “resolve” them by launching new wars of redistribution.
We must therefore take to heart and understand the summary of the international situation provided by Chairman Mao:
“The next fifty to one hundred years will be a great era of radical changes in social systems throughout the world, a period of upheaval unprecedented in history. We, who are living in such a period, must be prepared to throw ourselves into great struggles that will differ significantly in form from the struggles of the past.”
Kontakta oss via Kommunisten@riseup.net!