The Downfall of Capitalism and Communism
Encyclopedia
The Downfall of Capitalism and Communism is a major work by Ravi Batra
Ravi Batra
Raveendra Nath "Ravi" Batra is an Indian-American economist, author, and professor at Southern Methodist University. Batra is the author of six international bestsellers, two of which appeared on The New York Times Best Seller list...

 in the field of historical evolution
Social cycle theory
Social cycle theories are among the earliest social theories in sociology. Unlike the theory of social evolutionism, which views the evolution of society and human history as progressing in some new, unique direction, sociological cycle theory argues that events and stages of society and history...

, published in 1978. The book's full title is The Downfall of Capitalism and Communism: A New Study of History. Following the collapse of Soviet Communism in 1990, a 2nd edition was published with the title The Downfall of Capitalism and Communism: Can Capitalism Be Saved?

The book introduced an application of the theory of P.R. Sarkar that different socio-political groups, based on "inherent differences in human nature", that in turn are rooted in "characteristics of the mind," rotate in controlling the social motivity
Law of Social Cycle
Law of Social Cycle, also known as the Social Cycle Theory, is a theory of human historical motivity based on "the ancient spiritual ideas of the Vedas"...

, determining the historical evolution over time. A group of warriors, intellectuals or acquisitors take turns at leading society in their respective ages marked by ascension, supremacy and decline. Batra's book contains a wealth of evidence of historical ages
Epoch (reference date)
In the fields of chronology and periodization, an epoch is an instance in time chosen as the origin of a particular era. The "epoch" then serves as a reference point from which time is measured...

 reflecting the theory.

Downfall of communism

The predicted downfall of the increasingly enfeebled age of warriors or communism began in 1989 with revolutions in Eastern Europe
Revolutions of 1989
The Revolutions of 1989 were the revolutions which overthrew the communist regimes in various Central and Eastern European countries.The events began in Poland in 1989, and continued in Hungary, East Germany, Bulgaria, Czechoslovakia and...

 and ended in 1990 with the dissolution of the Soviet Union
Dissolution of the Soviet Union
The dissolution of the Soviet Union was the disintegration of the federal political structures and central government of the Union of Soviet Socialist Republics , resulting in the independence of all fifteen republics of the Soviet Union between March 11, 1990 and December 25, 1991...

. The Italian Senate awarded Batra the Medal of the Italian Senate for his accurate prediction in 1990.

Many observers in the 1970s believed in the invincibility of the Soviet system, but Batra was of a different view.

"I will now argue that the new [intellectual] era in Russian society has been long overdue, and that the next transition could come at any time, perhaps in the next twenty-five to fifty years, perhaps in another century. But come it must. And the current Soviet repression of intellectuals, is simply a harbinger of the new intellectual age" (pg. 220).


In the event, the end of the Soviet Union
Soviet Union
The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....

 and the Iron curtain
Iron Curtain
The concept of the Iron Curtain symbolized the ideological fighting and physical boundary dividing Europe into two separate areas from the end of World War II in 1945 until the end of the Cold War in 1989...

 occurred just over one decade after the book was published.

Downfall of capitalism

From 2007, Batra writes, the age of acquisitors in the West has come under a grave strain as financial capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...

 has suddenly erupted in a full blown financial crisis. He posits that, to some extent, the election of Barack Obama
Barack Obama
Barack Hussein Obama II is the 44th and current President of the United States. He is the first African American to hold the office. Obama previously served as a United States Senator from Illinois, from January 2005 until he resigned following his victory in the 2008 presidential election.Born in...

 as US President in November 2008 is a sign of public rejection of the economic policies of George W. Bush
George W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....

. In the autumn of 2011, the Occupy Wall Street
Occupy Wall Street
Occupy Wall Street is an ongoing series of demonstrations initiated by the Canadian activist group Adbusters which began September 17, 2011 in Zuccotti Park, located in New York City's Wall Street financial district...

 movement, protesting against "social and economic inequality, corporate greed, and the influence of corporate money and lobbyists on government, among other concerns", has spread throughout the USA. In European countries seriously affected by the crisis, such as Iceland in October 2008 and Eastern Europe in February 2009, significant political changes have taken place. In 2010 and 2011, riots have broken out in Greece and other countries in response to ever greater demands for fiscal austerity to stem the European sovereign debt crisis.

Batra suggested capitalism would collapse before communism.
In 1985, in his bestselling book, The Great Depression of 1990, Batra predicted the collapse of capitalism would begin in 1990. While the US escaped a calamity that year, Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...

, Sweden
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....

 and Finland
Finland
Finland , officially the Republic of Finland, is a Nordic country situated in the Fennoscandian region of Northern Europe. It is bordered by Sweden in the west, Norway in the north and Russia in the east, while Estonia lies to its south across the Gulf of Finland.Around 5.4 million people reside...

 experienced a full blown financial crash, which was followed by an extended period of economic stagnation. The USA muddled on with its own banking problems. Yet the decade saw ever more serious financial crises erupting around the world. First was the speculative attack
Speculative attack
A speculative attack is a term used by economists to denote a precipitous acquisition of something by previously inactive speculators. The first model of a speculative attack was contained in a 1975 discussion paper on the gold market by Stephen Salant and Dale Henderson at the Federal Reserve Board...

 on the ERM
Black Wednesday
In politics and economics, Black Wednesday refers to the events of 16 September 1992 when the British Conservative government was forced to withdraw the pound sterling from the European Exchange Rate Mechanism after they were unable to keep it above its agreed lower limit...

 (1992), which was followed by Mexico
1994 economic crisis in Mexico
The 1994 Economic Crisis in Mexico, widely known as the Mexican peso crisis, was caused by the sudden devaluation of the Mexican peso in December 1994....

 (1994), Asia (1997), Russia (1998), the collapse of LTCM
Long-Term Capital Management
Long-Term Capital Management L.P. was a speculative hedge fund based in Greenwich, Connecticut that utilized absolute-return trading strategies combined with high leverage...

 (1998) and Argentina (1999). In the USA, the IT bubble
Dot-com bubble
The dot-com bubble was a speculative bubble covering roughly 1995–2000 during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more...

 burst in 2000, followed by a temporary resurgence associated with the US-led war in Iraq and an excessively accommodative monetary policy designed by Alan Greenspan
Alan Greenspan
Alan Greenspan is an American economist who served as Chairman of the Federal Reserve of the United States from 1987 to 2006. He currently works as a private advisor and provides consulting for firms through his company, Greenspan Associates LLC...

. Up to this time, most economists lauded the successes of financial capitalism
Financial capitalism
Financial capitalism is a form of capitalism where the intermediation of savings to investment becomes a dominant function in the economy, with implications for the political process and social evolution...

, except Batra, who continued to predict its inevitable collapse in numerous books. Finally, in 2007, a financial crisis erupted in the USA, the UK
2008 United Kingdom bank rescue package
A bank rescue package totalling some £500 billion was announced by the British government on 8 October 2008, as a response to the ongoing global financial crisis. After two unsteady weeks at the end of September, the first week of October had seen major falls in the stock market and severe worries...

, Iceland, and other countries. In November 2008, Batra said he was "afraid the global financial debacle will turn into a steep recession and be the worst since the Great Depression
Great Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...

, even worse than the painful slump of 1980–1982 that afflicted the whole world". In October 2011, Batra argued that predictions made in his 2007 book The New Golden Age: The Coming Revolution against Political Corruption and Economic Chaos had begun to be realised with the Occupy Wall Street movement and that it would be successful.
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