Since his appointment as a Canada Research Chair in 2002, Panitch has focused his academic research and writing on the spread of global capitalism. He argues that this process of globalization is being led by the American state through agencies such as the U.S. Department of the Treasury and the Federal Reserve. Panitch sees globalization as a form of imperialism, but argues that the American Empire is an "informal" one in which the US sets rules for trade and investment in partnership with other sovereign, but less powerful, capitalist states. His latest book, The Making of Global Capitalism: The Political Economy of American Empire (2012), written with his close friend and university colleague Sam Gindin, traces the development of American-led globalization over more than a century. In 2013, the book was awarded the Deutscher Memorial Prize in the U.K. for best and most creative work in or about the Marxist tradition and in 2014, it won the Rik Davidson/SPE Book Prize for the best book in political economy by a Canadian.
Panitch is the author of more than 100 scholarly articles and nine books including, Working-Class Politics in Crisis: Essays on Labour and the State (1986), The End of Parliamentary Socialism: from New Left to New Labour (2001) and, Renewing Socialism: Transforming Democracy, Strategy and Imagination (2008) in which he argues that capitalism is inherently unjust and undemocratic.
Leo Victor Panitch grew up in Winnipeg's North End, a working-class neighbourhood that, as he noted decades later, produced "many people of a radical left political disposition." His Jewish father, Max Panitch, was born in the southern Ukraine town of Uscihtsa, but remained behind in Bucharest, Romania with a fervently religious uncle when his family emigrated to Winnipeg in 1912. He was reunited with them in 1922 and by that time was well on his way to becoming a socialist and a Labour Zionist. As a sewer and cutter of fur coats (an 'aristocrat of the needle trade'), he was active in the Winnipeg labour movement and the Manitoba CCF and its successor, the NDP. Panitch's mother, Sarah, was an orphan from Rivne in the central Ukraine who had come to Winnipeg in 1921 at the age of 13 accompanied only by her older sister. Max and Sarah married in 1930. Panitch's older brother Hersh was born in 1934.
Panitch attended a secular Jewish school named after the radical Polish-Yiddish writer I.L. Peretz. During a conference on Jewish radicalism in Winnipeg held in 2001, Panitch said the school grew out of the socialist fraternal mutual aid societies that Jewish immigrants had established. These included the Arbeiter Ring also known as the Workmen's Circle. Panitch told the conference that its first declaration of principles, adopted in 1901, began with the words: "The spirit of the Workmen’s Circle is freedom of thought and endeavour towards solidarity of the workers, faithfulness to the interests of its class in the struggle against oppression and exploitation." He added: "As such institutions multiplied and spread through the Jewish community, for a great many people and for a considerable number of decades to come, to be Jewish, especially in a city like Winnipeg, came to mean to be radical."
Panitch received a B.A. (Hons.) in economics and political science in 1967 from the University of Manitoba. During his undergraduate years, he realized how much the writings of Karl Marx and the evolution of historical materialism helped him understand capitalism and its relation to the state. One of his teachers, Cy Gonick, introduced him to ideas about industrial democracy in which workers would control and manage their own workplaces. The 1960s generation of the New Left, Panitch writes, was impelled towards socialism by "our experience with and observation of the inequalities, irrationalities, intolerances and hierarchies of our own capitalist societies."
At age 22, Panitch left Winnipeg and moved to London, England where he earned his M.Sc. (Hons.) in 1968 at the London School of Economics and his PhD from LSE in 1974. His doctoral thesis was entitled "The Labour Party and the Trade Unions." It was published as Social Democracy and Industrial Militancy in 1976 by Cambridge University Press.
Panitch taught at Carleton University between 1972 and 1984, and has been a Professor of Political Science at York University since 1984, serving as the Chair of the Department of Political Science from 1988-1994. In 2002, he was appointed Canada Research Chair in Comparative Political Economy at York. The appointment was renewed in 2009. His research involves examining the role of the American state and multinational corporations in the evolution of global capitalism.
After his text in Canadian political science, The Canadian State: Political Economy and Political Power, was published in 1977 by the University of Toronto Press, Panitch became the General Co-editor of its State and Economic Life book series in 1979 serving in that role until 1995. In 1979, he was also co-founder of the Canadian academic journal, Studies in Political Economy (on whose advisory board he still sits).
He was also politically active in the two main organizational successors to The Waffle after it was expelled from the NDP in the early 1970s, the Movement for an Independent Socialist Canada and the Ottawa Committee for Labour Action. In the 1980s, he was a regular columnist ("Panitch on Politics") for the independent socialist magazine, Canadian Dimension, and has remained active in socialist political circles, in particular the Socialist Project in Toronto (www.socialistproject.ca). He was inducted as an Academic Fellow of the Royal Society of Canada in 1995, and has also been a member of the Marxist Institute and the Committee on Socialist Studies as well as the Canadian Political Science Association.
In addition to the 33 annual volumes of the Socialist Register he has edited since 1985, he has been the author of over 100 scholarly articles and has published nine books, including From Consent to Coercion: The Assault on Trade Union Freedoms; A Different Kind of State: Popular Power and Democratic Administration; The End of Parliamentary Socialism: From New Left to New Labour; American Empire and the Political Economy of Global Finance; and In and Out of Crisis: The Global Financial Meltdown and Left Alternatives.
At the "Globalization, Justice and Democracy" symposium (Delhi University, November 11, 2010), Panitch, drawing on his book In and Out of Crisis (with Greg Albo and Sam Gindin), addressed a lack of ambition on the left which, he argued, has been more debilitating than its lack of capacity in the global economic crisis. He outlined immediate reforms that could lead to fundamental changes in class relations including nationalizing banks and turning them into public utilities; demanding universal public pensions to replace private, employer-sponsored ones; and free health care, education and public transit as a way of escaping capitalism's drive to turn public needs into marketable, profit-generating commodities.
In 2012, Leo Panitch, with his friend and colleague Sam Gindin, published The Making of Global Capitalism: The Political Economy of American Empire (2012). As its title suggests, the 456-page book is a comprehensive study of the growth of a global capitalist system over more than a century. Panitch and Gindin argue that the process known as globalization was not an inevitable outcome of expansionary capitalism, but was consciously planned and managed by America, the world's most powerful state.
They dispute the idea that globalization was driven by multinational corporations that have become more powerful than nation states. For them, this claim ignores the intricate relationships between states and capitalism; states maintain property rights, oversee contracts and sign free trade agreements, for example, while deriving tax revenues and popular legitimacy from the success of capitalist enterprises within their borders.
Panitch and Gindin also dismiss claims that the American Empire is in decline as shown, for example, by U.S. trade deficits, industrial shutdowns and layoffs. They argue, in fact, that the opposite is true. In recent decades, American firms "restructured key production processes, outsourced others to cheaper and more specialized suppliers and relocated to the U.S. south — all as part of an accelerated general reallocation of capital within the American economy." They write that although it is always highly volatile, the robust and globally dominant U.S. financial system facilitated this economic restructuring while making pools of venture capital available for investment in new, high-tech firms. As a result, the U.S. share of global production remained stable at around one quarter of the total right into the 21st century.
According to Panitch and Gindin, the institutional foundations for American-led global capitalism were laid during the Great Depression of the 1930s when the Roosevelt administration strengthened the U.S. Federal Reserve and the U.S. Treasury while establishing a wide range of economic and financial regulatory agencies. U.S. entry into World War II led, moreover, to the growth of a permanent American military-industrial complex.
The authors argue that these state financial and military institutions made the U.S. into a Great Power capable of superintending the spread of its own brand of capitalism. The U.S. also dominated post-war global institutions such as the International Monetary Fund and the World Bank, while the American dollar, backed by U.S. Treasury bonds, became the anchor for international finance. Panitch and Gindin write that the American-financed post-war rebuilding of Europe and Japan, "through low-interest loans, direct grants, technological assistance, and favourable trading relations," created the conditions for investment by U.S. multi-national corporations and eventually for substantial foreign investment in the U.S.
As they trace the history of global capitalism, Panitch and Gindin write that in the years after World War II, the U.S. succeeded in building an "informal empire" integrating other capitalist states into a co-ordinated, global capitalist system:
The U.S. informal empire constituted a distinctly new form of political rule. Instead of aiming for territorial expansion along the lines of the old empires, U.S. military interventions were primarily aimed at preventing the closure of particular places or whole regions of the globe to capital accumulation. This was part of a larger remit of creating openings for or removing barriers to capital in general, not just U.S. capital. The maintenance and indeed steady growth of U.S. military installations around the globe after World War II, mostly on the territory of independent states, needs to be seen in this light rather than in terms of securing territorial space for the exclusive U.S. use of natural resources and accumulation by its corporations.
Although the U.S. dominates in this informal, imperial system, Panitch and Gindin argue that other advanced capitalist states maintain their sovereignty, but must defer to American wishes when it comes to military interventions abroad. "The American state arrogated to itself," they argue, "the sole right to intervene against other sovereign states (which it repeatedly did around the world), and largely reserved to its own discretion the interpretation of international rules and norms."
The book chronicles the “golden age” of capitalism during the 1950s and '60s when capitalists enjoyed high profits in a booming, full-employment American economy. Workers benefited too from improved social programs and the higher wages that labour unions fought for and won. But, as the authors point out, capitalism is prone to crisis, and the 1970s produced "stagflation", simultaneously high rates of inflation and unemployment, stagnant economies and declining profits.
In 1979, Paul Volcker, Chairman of the Federal Reserve found a way out of the crisis by administering the "Volcker shock", double-digit interest rates. The deep recession that followed brought high unemployment and with that, a decline over time of labour militancy. The adoption of neoliberal policies during the 1980s, that restricted workers' rights to organize and to strike, made it possible for capitalists to "discipline" workers by demanding greater "flexibity" in hours and working conditions and by holding down wages. Neoliberalism also led to an array of free trade agreements that promoted worldwide corporate investment and production.
According to Panitch and Gindin, the neoliberal era ushered in a second, highly-profitable "golden age", but this time only for the capitalist class, not for workers whose wages stagnated while union membership declined.
The final chapter in The Making of Global Capitalism is devoted to a detailed examination of the international financial crisis that began in 2007 bringing an end to high corporate profits as millions lost their homes and consumer spending fell. Panitch and Gindin write that the crisis was preceded by decades of growth in volatile financial markets that had become crucial to underwriting capitalist expansion. They argue that the U.S. encouraged the growth in financial markets with its accompanying risk-taking even though it was periodically required "to put out financial conflagrations" such as the 1997 Asian financial crisis. The crisis of 2007-08, however, was not regional, but global:
The roots of the crisis, in fact, lay in the growing global importance of U.S. mortgage finance – a development which could not be understood apart from the expanded state support for home ownership, a long-standing element in the integration of workers into U.S. capitalism. Since the 1980s, wages had stagnated and social programs had been eroded, reinforcing workers' dependence on the rising value of their homes as a source of economic security. The decisive role of American state agencies in encouraging the development of mortgage-backed securities figured prominently in their spread throughout global financial markets. The close linkages between these markets and the American state were thus crucial both to the making of the U.S. housing bubble and to its profound global impact when it burst, as mortgage-backed securities became difficult to value and to sell, thus freezing the world's financial markets.
Panitch and Gindin add that the collapse of housing prices led to a sharp decline in U.S. consumer spending because housing represented a main source of workers' wealth. "The bursting of the housing bubble," they write, "thus had much greater effects than had the earlier bursting of the stock-market bubble at the turn of the century, and much greater implications for global capitalism in terms of the role the U.S. played as 'consumer of last resort'."
Panitch and Gindin note that the U.S., as manager-in-chief of the global capitalist system, once again came to the rescue with billions of dollars in bail-out money for domestic and foreign banks.
With the apparent victory of global capitalism and the neoliberal state in the 21st century, Panitch notes the persistence of what he calls a "debilitating pessimism" about the possibility of realizing a better world. He writes that while some on the left, such as Tony Blair, chose what they called the politics of the third way—an attempt to reconcile socialist goals with a capitalist economy—others continue to feel powerless and defeated, especially in light of communism's failure to develop a democratic alternative to global capitalism.
Panitch argues that to avoid the politics of the third way and to transcend pessimism, socialists need to revive the utopian ideal in which human beings are free to realize their potential by building their capacities for freedom and equality through social co-operation. He writes that "capitalism is unjust and undemocratic not because of this or that imperfection in relation to equality and freedom, but because at its core it involves the control by some of the use and development of the potential of others, and because the competition it fosters frustrates humanity's capacity for liberation through the social."
He recommends that socialists work towards a better world by developing alternative models to enhance human capacities for co-operation and democracy. These include communications systems that are not driven by advertising and consumption; organizations that are non-hierarchical beginning with socialist parties, unions, movements, NGOs and universities; and alternative, communal ways of living that could extend the bonds of the nuclear family to "a broader supportive community."
Panitch argues a rekindling of the socialist imagination requires the recognition of the basic utopian principle that "you simply cannot have private property in the means of production, finance, exchange and communication and at the same time have an unalienated, socially just and democratic social order; and that you cannot begin to approach a utopia on the basis of the acquisitive and competitive drive."
Leo Panitch married Melanie Pollock of Winnipeg in 1967. She is an longtime activist and human rights advocate who teaches in the School of Disability Studies at Ryerson University in Toronto. In 2006, Melanie Panitch earned a doctorate in social welfare from the City University of New York. Her thesis, on the history of the Canadian Association for Community Living, focused on mothers' campaigns to close institutions and gain human rights for disabled Canadians. In 2007, it was published as Disability, Mothers and Organization: Accidental Activists.
The Panitches have two children. Maxim is a photographer, writer and Scrabble champion while Vida is a philosophy professor at Carleton University in Ottawa.
Leo Panitch speaks three languages, English, French and Yiddish. He and Melanie live in Toronto.