The Dialectics of Wealth and Poverty

Prabhat Patnaik | 02 Nov 2024

NEWSCLICK INDIA

There is a lacuna in the 2024 Economics Nobel Prize winners looking at poverty as arising from an absence of development rather than being a dialectical accompaniment of growth itself.

This year’s Nobel Prize in economics (the Riksbank Prize to be more precise) has been awarded to three US-based economists for their research into what promotes or hinders the growth of wealth among nations; and they assign a crucial role to institutions, arguing that Western institutions, like electoral democracy, are conducive to growth. Where colonialism led to the promotion of what they call “inclusive institutions” such as in settler colonies, growth flourished, but elsewhere in the colonial empire, where colonialism set up “extractive institutions”, they turned out to be harmful for growth.

Their work has aroused much criticism. Some have argued that their argument lacks substance: the growth-success of East Asia is accompanied by a lack of Western-style democracy, and of a corruption-free environment; indeed, corruption characterised the Western countries in their period of high growth.

Others have argued that the contrast between the colonies of settlement and other colonies can be attributed to the former receiving as immigrants the “kith and kin” of Western populations. Still others have been critical of the authors’ apotheosising Western institutions and of their being silent on the extreme oppression unleashed by colonialism.

Our purpose here is not to discuss these authors’ arguments but to underscore a basic lacuna in their very perception of growth and under-development, a lacuna that characterises the perception of even their critics, no matter how right these critics may otherwise be. This lacuna consists in their looking at poverty as arising from an absence of development rather than being a dialectical accompaniment of growth itself. The picture they implicitly subscribe to is of a race, where some countries with good (“inclusive”) institutions moved ahead while others with bad (“extractive”) institutions stayed behind.

What this picture misses is that the staying behind of some is because the others moved ahead, that capitalist growth produces poverty. The late Andre Gunder Frank had coined a phrase to describe this phenomenon: the development of under-development, which emphasised that under-development was not lack of development but itself a specific form of development that accompanied what we generally recognise as “development”. There is a complete absence of recognition of the dialectics between development and under-development or between the growth of wealth at one pole and poverty at another in the argument of the awardees of the Riksbank Prize.

The basic reason for this dialectics of the growth of wealth accompanying the growth of poverty, and its international counterpart, namely, the development of some countries accompanying the under-development of others lies in the following: capitalist growth is necessarily accompanied by a process of primitive accumulation of capital, entailing the expropriation and hence impoverishment of a mass of petty producers; but the number of persons engaged within the capitalist sector, those whom it assimilates as workers directly, are just a fraction of those impoverished.

The absolute numbers of the victims of primitive accumulation of capital who remain “outside the system” keep increasing as capital accumulation proceeds; or, if their absolute numbers do not increase but either remain constant or decline, then the extent of poverty increases among them. But a decline in both, the numbers impoverished by the system but remaining outside of it, and the extent of poverty of such persons, is ruled out by the fact that primitive accumulation is a ceaseless process.

It is this phenomenon which explains why the accumulation of wealth at one pole is simultaneously accompanied by the growth of poverty at another. The perception of this phenomenon, however, is typically obscured by the absence of a comprehensive vision of the totality of the accumulation process; attention is focussed only on a particular part of it, which gives an erroneous impression.

In the course of the long boom of capitalism, stretching from the mid-19th century right until the First World War, when capitalism consolidated itself as a global system, this dialectic of wealth and poverty worked as follows. There was a spread of capitalism from Britain to continental Europe and further to the temperate regions of European settlement, like Canada, the United States, Australia, New Zealand and South Africa.

The mechanism for this was a diffusion of industry to these areas of settler colonialism, made possible by Britain not only keeping its own market open to imports from these regions, but additionally exporting capital to them to accompany the massive out-migration from Britain and the rest of Europe to these regions.

The scale of European migration was estimated to be at least 50 million between the end of the Napoleonic war and the First World War. Those who migrated, dispossessed the local populations of their land; those of them who did not die fighting, or from the new diseases to which they were now exposed, were herded into “reservations”. The migration from Britain alone was so large that almost half the natural increase in Britain’s population each year, is estimated to have left its shores for the “New World” during this period.

Since the British market was open to both primary sector and industrial exports from these newly-industrialising countries of settlement and in addition Britain also made capital exports to these same countries, it ran up large balance of payments deficits vis-a-vis them.

Besides, Britain’s import surplus from these regions would have normally caused some de-industrialisation in the British economy creating unemployment and generating pressures to protect the British market against imported goods. This was averted because British goods, including above all cotton textiles that had spearheaded the Industrial Revolution, and that were being produced far in excess of the needs of its own domestic market, were exported to its tropical colonies; Eric Hobsbawm refers to Britain’s increasingly selling in the (tropical) colonies what it could not at home, as a “flight to the colonies”. Such exports caused in turn de-industrialisation in these colonies where the traditional artisans and craftsmen, above all spinners and weavers, lost their occupations and were thrown onto the land causing an increase in rents, a decline in wages, and a rise in mass poverty.

Britain’s balance of payments deficits vis-à-vis the “newly industrialising countries” of that period, were covered substantially by two items it earned from the tropical colonies: one was the de-industrialising exports to these colonies referred to above. The other was the drain of wealth, namely one-way transfers, from these colonies to Britain: the entire annual export surplus earnings of countries like India were siphoned off by Britain without any quid pro quo and helped to pay for Britain’s deficit vis-à-vis its settler colonies and other “new industrialisers”.

This system worked because these tropical colonies had a merchandise export surplus vis-à-vis the European Continent, the New World as well as Japan. India’s massive merchandise export surplus with these countries, the second largest in the world for many decades, arose from its ability to supply the primary commodities they required for their industrialisation. These export surplus earnings were entirely appropriated gratis by Britain to pay for its own deficit vis-à-vis the “New World”. It was gratis because Britain ‘paid’ the peasantry for their export goods out of their own taxes; this was perhaps the most important source of generating poverty in the tropical colonies.

The growth of wealth in the settler colonies and elsewhere during what Hobsbawm calls the “long nineteenth century” (stretching up to the First World War) had as its counterpart the growth of poverty, including periodic famines, in the tropical colonies which were colonies of conquest (as distinct from colonies of settlement).

Lest it be thought that countries like India were always as poor as they were at the time of Independence, an estimate by Shireen Moosvi, the economic historian, is worth citing here. She estimates the per capita income of Mughal India from the revenue figures given by Abul Fazl for 1575 and compares it with the per capita income figure provided by S Subramonian for the whole of India for 1910, and finds the latter to be lower than the former in real terms.

The spread of industrial capitalism in the long 19th century was made possible by sucking out a part of the surplus from tropical colonies; the market access provided to the “new industrialisers” by Britain had as its counterpart the encroachment by Britain into the markets of its tropical colonies. Both these were part of a process of primitive accumulation of capital which produced modern mass poverty in these colonies; but the beneficiaries of this primitive accumulation of capital were the temperate regions of European settlement which witnessed a massive increase in their wealth.

The accumulation of wealth and the accumulation of poverty were thus dialectically related. But bourgeois economics would never admit this fact.

Prabhat Patnaik is Professor Emeritus, Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. The views are personal.

Ian Angus’s ‘The War Against the Commons’: A vital new history of the bloody rise of capitalism

Steve Leigh
12 June, 2024


First published at Firebrand.


In Marxist theory, primitive accumulation is, as Marx defined it in Capital Volume I, “the historical process of divorcing the producer from the means of production.” Occurring at different times in different regions around the world, primitive accumulation is the stage of history during which the ruling class took wealth from the lower classes — unjustly, usually by force or by theft — in order to accumulate the capital they would need to become the capitalist class.

The War Against the Commons: Dispossession and Resistance in the Making of Capitalism is an excellent new book on this history from Canadian ecosocialist Ian Angus. It is a beautifully written examination of the rise of capitalism and the destruction of peasant livelihoods as the centuries-old social relations of feudalism were abandoned for a new mode of production. Though it largely focuses on the transformation of feudalism into capitalism in England and Scotland, it has many implications for socialist organizing and for environmentalism today.

Angus’s book is especially valuable for the way it sharply refutes the reactionary thesis of “the tragedy of the commons.” It also provides substantial clarity on Marx’s views of, as he put it, “so-called primitive accumulation.”
The rise of capitalism required the war on the commons

In The War Against the Commons, Angus argues that for hundreds of years, peasants had successfully managed common land to the benefit of all. They democratically decided on its use and did not over-exploit it as the reactionary thesis contends. Often peasants repartitioned the private strips of land around the common area to give every family enough land to survive.

Of course this was not some agrarian utopia. Under feudalism, landlords ruthlessly exploited the masses of peasantry, either as serfs, who were kept in bondage, or as free farmers who were still very much tied to the land. Peasants paid rent or performed service on the lord’s demesne (the lord’s private land, attached to their manor), or both. Peasants’ rights were limited and were at the whim of the lord when it came to justice. During times of war they might be called on to fight and die for the lord’s material interests.

But in return for that exploitation, peasants were allowed the collective use of common areas. The commons were absolutely essential to the livelihoods of the peasants.

Beginning with the rise of the market economy in the 15th century, landlords were under more pressure to raise revenue. As Angus writes, “Landed families which stuck to the old ways, left rents as they were and continued to grant long leases soon found themselves trapped between static incomes and rising prices.”

There were several related strategies employed by the landlords during this period of primitive accumulation: raising rents, enclosing the commons and adding it to their demesnes, consolidating farms into larger units, and replacing farming with sheep raising. The latter required less labor and created higher profits. Overt time, the economic differentiation of the peasantry — some peasants growing more wealthy while others slipped further into poverty — aided the landlords’ efforts.

The peasant class did not just go along with these land grabs and forcible changes to the previous social arrangement. They continually resisted these attacks that denied their livelihood, and peasant revolts broke out from time to time throughout this entire process.

These revolts peaked at particular times, sometimes culminating in revolutionary situations, such as Wat Tyler’s Rebellion in 1381. More often they involved re-taking common lands by tearing down fences and hedgerows. In the 1640s, these peasant revolts intersected with the English Revolution and Civil War.

According to Angus, the peasant revolts did not fuel either side of the Civil War exclusively. Though the Parliamentarians at first seemed to take the side of the peasants against the Royalists, in the end the consolidation of power by Parliament furthered the accumulation of land in the hands of the landlords.

The most radical elements during this period were the Diggers, who tried to extend communal ownership of land both physically and through political organizing.

At the beginning of the war against the commons, the English Crown tried to restrain enclosures. They feared depopulation that would deny the needed soldiers for war; and they also feared social unrest.

Thus, the Crown passed laws to slow down the enclosure process. But landlords, who often controlled the local justices of the peace, prevented effective enforcement of these laws. Over time, Crown resistance to land consolidation and enclosure waned as the new capitalist relations dominated the economy more and more.

Angus also examines the role of the “commonwealth men” who were theoretically against capitalist development, but also opposed peasant resistance to the rising power of capitalism. They were similar to the “feudal socialists” whom Marx and Engels denounced in the Communist Manifesto — the aristocrats who railed against the exploitation of the new capitalist order and attempted to sway the proletariat to their side, while still holding deeply reactionary views. “What they upbraid the bourgeoisie with is not so much that it creates a proletariat,” they wrote, “as that it creates a revolutionary proletariat.”

Despite the peasant revolts, the dominant trend was toward enclosure and consolidation as rural residents were expelled from the land. Many became vagabonds who tried to survive by begging and stealing. Over time, the peasants who were kicked off the land became the basis of the working class that capitalism needed in industry. Thus, primitive accumulation created the proletarian class even as it destroyed feudalism.

During this era, rural people with small cottages entered the capitalist system directly by working for capitalists as weavers or in other trades under the “putting-out system.” Under this system, merchants would sell raw materials to cottagers who would work it up into products. Merchants would then buy the finished product back at a fixed rate, rather than pay a wage.

Marx called this the “formal subsumption” of labor to capital as opposed to the “real subsumption” of wage labor.
Wage labor was the last resort

When peasants were expelled from the land, wage labor was the last resort for survival. Thus, people saw wage labor as another form of slavery. As Marx wrote in Capital:


A new class of wage-laborers was born in England when great masses of men were suddenly and forcibly torn from their means of subsistence, and hurled onto the labor-market as free, unprotected and rightless proletarians.

Under feudalism, they had largely controlled their own labor. The work day was governed by the weather, seasons, and other natural conditions. Under capitalism, labor was controlled by the clock and working hours were longer.

To enforce wage labor, the state now dominated by capitalism used draconian methods, including actual slavery. “Poaching” was outlawed for the poor who needed food, but hunting was allowed for the rich who did not need it. For a period, England enforced the death penalty for hundreds of offenses, including poaching and petty theft, and also made regular use of transportation to the colonies in Australia and elsewhere.

The destruction of the old rural economy unleashed more people than the rising capitalist economy could absorb. Even if there was not enough wage work available, vagabonds were punished for not working for a master. The creation of capitalism was based on the horrific oppression of ordinary people.

This process of consolidating capitalism in England took hundreds of years, from the 15th to the 18th centuries. The practice of enclosure persisted well into the 19th century in England. In Scotland, it happened much faster after the English conquest; the results were equally bloody but much more condensed in time.

Apologists for capitalism contend that it made agriculture much more efficient. Angus thoroughly refutes this, showing that many of these improvements arose during the period of peasant management of the commons.

Angus also shows that caloric intake declined as capitalism rose. “Most industrial workers and agricultural laborers were malnourished,” he writes.

“They were less healthy and died younger than their ancestors a century earlier.” According to Angus, “The expansion of the capitalist world system caused a dramatic and prolonged process of impoverishment on a scale unprecedented in recorded history.”
The destructive birth of capitalism

Importantly, Angus explains Marx’s critical views of the war against the commons. Too many would-be Marxists stress the progressive nature of the rise of capitalism. Marx, on the other hand, saw it as a destructive process, even though it ultimately developed the productive forces that would allow the working class to take power and establish communism. As Marx famously put it, “Capital comes dripping from head to foot, from every pore, with blood and dirt.”

Marx preferred to discuss the war against the commons as “original expropriation” rather than primitive accumulation. Marx ultimately felt that “primitive accumulation” was too neutral a term — which is why he often qualified the phrase as so-called primitive accumulation.

Too many people miss Marx’s sarcasm when discussing this issue. Marx made it clear that capitalists stole their wealth from others rather than amassing it through hard work or intelligence, as the capitalist myth would have it. When workers no longer have access to the means of production, they end up having to work for those who stole it from them.

A large part of this original theft came from colonization. Angus explains the process of wealth seizure in the colonies as a further basis for the accumulation of capital in England. The effects on the native population of the Western Hemisphere and on enslaved Africans are well-known. As Marx wrote in Capital: “The veiled slavery of the wage-laborers in Europe needed the unqualified slavery of the New World as its pedestal.”

He goes on:


The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the indigenous population of that continent , the beginnings of the conquest and looting of India, and the conversion of Africa into a preserve for the commercial hunting of blackskins, are all things which characterize the rosy dawn of the era of capitalist production.

Thus the issues raised by this history are directly relevant to anticolonial and antiracist struggles today.
Debates on the left and the ongoing relevance of the history of accumulation

According to Angus, the war against the commons continues to this day. He believes Marx saw expropriation as a continual basis of capitalism, not just a contained process occurring at its dawn. Though capitalism now dominates the world economy, the dispossession of the world’s peasantry continues. Capital still accumulates through expropriation.

This bears on current political controversies on the left. David Harvey, for example, focuses in his writings on current “accumulation by dispossession.” Harvey seems to downplay the importance of the basic process of mature capitalism: accumulation by exploitation — in other words, not paying workers the full value of what they produce. Angus does not explicitly endorse Harvey’s position but does argue the importance of the continuation of expropriation of peasant land.

This is an important emphasis which solidifies our understanding: “Since the late 1900s, capital’s continuing war against the commons has dispossessed millions of peasant families in Africa, Latin America and Asia.”

Modern-day peasant resistance to being forced off their land is certainly a struggle that the left should support. Peasants can be allies with workers in the war against capitalism — Marx agreed with this approach. Angus notes the positive attitude Marx had toward the peasant communes in Russia. He thought they could become the basis of a transformation to communism — but importantly only if connected to the international working-class revolution. Marx rejected a utopian view of the peasant commune.

Nor does Marx’s attitude mean that Marxists support the preservation of peasant property even after the working-class revolution. The goal is still collective control of the whole economy, including land, by the population as a whole.

In spite of the need for Marxists to defend the remaining commons, the current context is important. In the period that Angus focuses on in early modern England, capitalism was still forming. Most of the world was pre-capitalist. The seizure of the commons was absolutely essential to the rise of capitalism.

Today, the situation has been transformed. The world economy is now universally capitalist. Even the remaining peasant agriculture is largely commercial and integrated into the capitalist market. Subsistence agriculture, which was the essence of agriculture during the rise of capitalism, is now more marginal.

Over the last 141 years since Marx’s death, much of the common land has been taken by capitalists. The expropriation of peasant land today is a transfer of wealth among participants in the capitalist system. It is no longer the destruction of a pre-capitalist mode of production to make way for capitalism. Today, expropriation is an important supplement to exploitation, but only a supplement.

Contra Harvey, the main emphasis of anticapitalists today needs to be resistance against the exploitation of workers, and opposition to the oppression that divides workers. The form of a worker-peasant alliance will differ from country to country, but defense of peasants should be integrated into the working-class revolution rather than being seen as a separate struggle.

Angus argues that Marx and Engels were more flexible and less dogmatic than later Marxists are. He discusses how Engels was reluctant to give advice to Russian activists because of ignorance of Russian politics. Angus also says that Marx and Engels supported assassination as a political strategy in Russia even while opposing it in Britain.

This attitude is an important corrective to dogmatism. Marxists need to understand the political and economic situation before pronouncing on it. We must learn before we can teach! However, the world has transformed in the last 140 years. The spread of the capitalist system across the world means that Marx’s strategies for the capitalist countries in the 1880s are more applicable across the world today than they were in his time. Although we need to understand the specifics of each situation, the broad contours of the focus on working-class struggle are applicable everywhere. The Communist Manifesto’s famous conclusion, “Workers of the world unite; you have nothing to lose but your chains,” is even truer today than when Marx and Engels wrote it.

This shift is shown by the changing strategy of Russian Marxists, including the Bolsheviks, before the Revolution. As capitalism developed in Russia in the early 20th century, they moved away from Marx’s positive attitude to the Narodniks, who were oriented to the peasantry. Instead, they focused on organizing the industrial working class.

Finally, Angus raises the very important issue of overcoming the division between the town and country. Marx and Engels were very clear on the importance of spreading the population rather than having it concentrated in cities. They saw this as similar to the abolition of class division. In The Housing Question (1878), Engels wrote, “The abolition of the antithesis between town and country is no more and no less utopian than the abolition of the antithesis between capitalists and wage workers.”

The War Against the Commons is a brilliant examination of the rise of capitalism. It smashes some of the bases of capitalist ideology, and vindicates the possibility of democratic control of the earth. It makes a valuable contribution to current debates on the left, connecting anticapitalism to defense of the environment. It shows that capitalism has always been opposed to ecological sanity — for example demonstrating the direct connection between capitalism and fossil fuels, especially coal.

For all these reasons, it is a must-read for socialists and for all who care about the future of humanity and the planet.


Steve Leigh (he/him) is a founding member of Firebrand and the Seattle Revolutionary Socialists. He has been an active Marxist since 1971 and was a founding member of the International Socialist Organization. He was a shop steward in SEIU for 35 years and is a member of the retirees chapter of SEIU 925. Read more from Steve on his blog.

Free Book Online: Rosa Luxemburg and South Africa

Newly released online as a PDF



Capitalist accumulation as a whole, as an actual historical process,
has two different aspects. One concerns the commodity market
and the place where surplus value is produced – the factory,
the mine, the agricultural estate… The other aspect of the
accumulation of capital concerns the relations between capitalism
and the non-capitalist modes of production which start making
their appearance on the international stage. Its predominant
methods are colonial policy, an international loan system – a policy
of spheres of interest – and war. Force, fraud, oppression, looting
are openly displayed without any attempt at concealment…
Rosa Luxemburg, The Accumulation of Capital, p. 432.

Capital now devours human beings: it becomes a cannibal. Every
human activity must now become capital and bear interest, so
that investment-seeking capital can live: schools, kindergartens,
universities, health systems, energy utilities, roads, railways, the
post office, telecommunications and other means of communication,
etc. The anarcho-capitalist dreams go even further. Even the police
and legislation are to be transformed into capital investments. One
receives a licence to live and to participate in any of the spheres
of society only if one pays to capital the fees required in the form
of interest. Capital becomes a ‘superworld’ to which sacrificial
victims must be brought.
Ulrich Duchrow and Franz Hinkelammert,
Property for people, not for profit, p.148.

These two citations present in a nutshell the basic traits of capitalist
accumulation from its origins to its current forms – the dominance of the
capitalist forms in the arena of material production, the continuous use
of coercion, violence and theft in order to increase the rate of profit, as
well as the intrinsic tendency of capitalism to subjugate all aspects of
social life to the reign of profit.

The 3rd Rosa Luxemburg Political Education Seminar, jointly
organised by the Centre of Civil Society at the University of KwaZulu-
Natal in Durban and the Southern African Regional Office of the Rosa
Luxemburg Foundation in Johannesburg, was held on March 2nd – 4th
2006 in Durban. The Seminar examined these general characteristics of
capitalist accumulation within the global, regional and local context.
That context is shaped, on the one hand, by the growing impact of
a corporate driven globalisation, but also the expansion of South African
capital into neighbouring countries, the emergence of new forms of
‘primitive accumulation’ under the label of Black Economic Empowerment,
and the ongoing commodification and privatisation of public services.
On the other hand, there is a growing movement which not only
resists the commercialisation of all sphere of human life but strives to
build alternatives – to create ‘another world’ which is not only possible
but necessary.

The success of the Seminar is due to many contributors. Very
valuable inputs were made by overseas guests including Elmar Altvater,
Nicola Bullard, Massimo De Angelis, Ulrich Duchrow and Gill Hart.
Other crucial interventions came from scholar-activists from the region
including Jeff Guy, Ntwala Mwilima, Prishani Naidoo and Greg Ruiters.
But this alone would not have been enough to make the seminar the
thrilling event it was. The other factor was vibrant interaction from the
floor. Contributions by activists from townships and social movements
– and the often forgotten inconspicuous work of the staff members of the
organising institutions – created an atmosphere of rigorous debate and
mutual encouragement.

This book contains some of the contributions to the 3rd Rosa
Luxemburg Political Education Seminar. The materials gathered here
will hopefully provide a valuable source of inspiration for activists and
will encourage them to extend their studies on other important writings
which form part of our huge theoretical heritage. However, these texts
can never fully reflect the lively spirit of interaction and solidarity that
prevailed throughout the event. To experience this unique feeling it was
essential to be there.

See:

Marxism

Imperialism

Africa

State Capitalism in the USSR

Find blog posts, photos, events and more off-site about:
South Africa, Rosa Luxemburg, Marxism, capitalism, Imperialism, PDF, free book online

On the Historical Specificity of the Marxist Theory of Imperialism

Nikolai Bukharin

Grigorii Zinoviev

.

If it were necessary to give the briefest possible definition of imperialism we should have to say that imperialism is the monopoly stage of capitalism. Such a definition would include what is most important, for, on the one hand, finance capital is the bank capital of a few very big monopolist banks, merged with the capital of the monopolist associations of industrialists; and, on the other hand, the division of the world is the transition from a colonial policy which has extended without hindrance to territories unseized by any capitalist power, to a colonial policy of monopolist possession of the territory of the world, which has been completely divided up.

— Vladimir Lenin, Imperialism, the Highest Stage of Capitalist Development, from Lenin: Collected Works, Volume 22, pg. 266 (1915)

Modern imperialism is the social-economic policy of finance capital tending toward the creation of the most comprehensive economic territorial entities and world empires possible. It is characterized by the tendency to supplant free trade decisively with the system of protective tariffs and to subordinate economic life completely to the great monopolistic combines, such as the trusts, cartels, banking consortia, etc. Imperialism signifies the highest stage in the development of capitalism, in which not only commodity exports but capital exports as well occupy a place of quintessential importance. It characterizes an epoch in which the world is partitioned among a few great capitalist powers and in which the struggle proceeds along the lines of repartitioning it and partitioning the remaining areas.

— Grigorii Zinoviev, “What is Imperialism?” (1916)

The historian or economist who places under one denominator the structure of modern capitalism, i.e., modern production relations, and the numerous types of production relations that formerly led to wars of conquest, will understand nothing in the development of modern world economy.  One must single out the specific elements which characterise our time, and analyse them.  This was Marx’s method, and this is how a Marxist must approach the analysis of imperialism.  We now understand that it is impossible to confine oneself to the analysis of the forms, in which a policy manifests itself; for instance, one cannot be satisfied with defining a policy as that of “conquest,” “expansion,” “violence,” etc.  One must analyse the basis on which it rises and which it serves to widen.  We have defined imperialism as the policy of finance capital.  Therewith we uncovered the functional significance of that policy.  It upholds the structure of finance capital; it subjugates the world to the domination of finance capital; in place of the old pre-capitalist, or the old capitalist, production relations, it put the production relations of finance capital.  Just as finance capitalism (which must not be confused with money capital, for finance capital is characterised by being simultaneously banking and industrial capital) is an historically limited epoch, confined only to the last few decades, so imperialism, as the policy of finance capital, is a specific historic category.

— Nikolai Bukharin, Imperialism and World Economy, pg. 114 (1917)

Modern imperialism is not the prelude to the expansion of capital, as in Bauer’s model; on the contrary, it is only the last chapter of its historical process of expansion: it is the period of universally sharpened world competition between the capitalist states for the last remaining non-capitalist areas on earth. In this final phase, economic and political catastrophe is just as much the intrinsic, normal mode of existence for capital as it was in the ‘primitive accumulation’ of its development phase. The discovery of America and the sea route to India were not just Promethean achievements of the human mind and civilization but also, and inseparably, a series of mass murders of primitive peoples in the New World and large-scale slave trading with the peoples of Africa and Asia. Similarly, the economic expansion of capital in its imperialist final phase is inseparable from the series of colonial conquests and World Wars which we are now experiencing. What distinguishes imperialism as the last struggle for capitalist world domination is not simply the remarkable energy and universality of expansion but — and this is the specific sign that the circle of development is beginning to close — the return of the decisive struggle for expansion from those areas which are being fought over back to its home countries. In this way, imperialism brings catastrophe as a mode of existence back from the periphery of capitalist development to its point of departure. The expansion of capital, which for four centuries had given the existence and civilization of all non-capitalist peoples in Asia, Africa, America and Australia over to ceaseless convulsions and general and complete decline, is now plunging the civilized peoples of Europe itself into a series of catastrophes whose final result can only be the decline of civilization or the transition to the socialist mode of production. Seen in this light, the position of the proletariat with regard to imperialism leads to a general confrontation with the rule of capital. The specific rules of its conduct are given by that historical alternative.

According to official ‘expert’ Marxism, the rules are quite different. The belief in the possibility of accumulation in an ‘isolated capitalist society’, the belief that capitalism is conceivable even without expansion, is the theoretical formula of a quite distinct tactical tendency. The logical conclusion of this idea is to look on the phase of imperialism not as a historical necessity, as the decisive conflict for socialism, but as the wicked invention of a small group of people who profit from it. This leads to convincing the bourgeoisie that, even from the point of view of their capitalist interests, imperialism and militarism are harmful, thus isolating the alleged small group of beneficiaries of this imperialism and forming a bloc of the proletariat with broad sections of the bourgeoisie in order to ‘moderate’ imperialism, starve it out by ‘partial disarmament’ and ‘draw its claws’! Just as liberalism in the period of its decline appeals for a well-informed as against an ill-informed monarchy, the ‘Marxist center’ appeals for the bourgeoisie it will educate as against the ill-advised one, for international disarmament treaties as against the disaster course of imperialism, for the peaceful federation of democratic nation-states as against the struggle of the great powers for armed world domination. The final confrontation between proletariat and capital to settle their world-historical contradiction is converted into the utopia of a historical compromise between proletariat and bourgeoisie to ‘moderate’ the imperialist contradictions between capitalist states.

— Rosa Luxemburg, Anti-Critique (1915)

My reason for citing the above excerpts is that I feel that the Marxist theory of imperialism — as developed by Rudolf Hilferding, Rosa Luxemburg, Vladimir Lenin, Grigorii Zinoviev, and Nikolai Bukharin — has been widely abused in recent decades in analyzing the intervention of advanced capitalist states (the U.S. or members of the European Union) into less developed countries.  While there can be no doubt that there exist some parallels and continuities between the kind of self-interested exploitation of Third World countries, typically ex-colonies, that takes place today and the imperialism of old, these theorists understood it as a specific outgrowth of monopoly or finance capitalism.  If I might be permitted to grant this phase of capitalism a periodicity, I would probably place it between 1880-1929.  Since this time, capitalism has undergone not one but two drastic reconfigurations (Fordism and neoliberalism).  For this reason, I think that the term should not be so loosely thrown around in describing current affairs, as many of these categories need to be reworked to fit the present day.

There are many fundamental differences between the phenomenon Lenin et al. described as “imperialism” and what has more recently been dubbed “imperialism” (or, perhaps more fittingly, “neo-imperialism”).

Lenin understood imperialism to entail a certain underlying logic, the bloody competition between great capitalist powers to carve up the earth according to zones of influence and direct colonial administration in pursuit of new markets, raw materials, and cheap labor.  Moreover, he believed that this competition between the great capitalist powers of the world, which were at the time mostly European but also included Japan and the United States, would escalate to the point where an inter-imperialist war, by definition a world war, was inevitable.  This was a multipolar world, in which no one great power could be said to predominate completely, and in which large-scale alliances were formed in anticipation of major conflict that everyone knew was on the horizon.  Also, imperialism constituted the logical outgrowth of the shift from liberal capitalism, where the prevailing Manchester School ideology of “free markets” dominated and liberalism (quite contrary to its historical aspirations) held the reigns of state power, from 1848-1873, to monopoly or finance capitalism, where smaller competitors were gradually pushed out as major trusts swallowed up their rivals and cut deals with the governments in order to corner the market in the aftermath of the “long crisis” of 1873.

What leftists generally understand imperialism to mean today is the more or less cooperative domination of either the single world superpower, the US, or in tandem with its various allies in NATO (another Cold War holdover) or the UN.  While military occupations clearly last over years of bloody conflict, the point is not direct colonial administration but the indirect establishment of quasi-independent regimes that will be “friendly” to US or European interests.  No one really believes that these various military interventions around the world are actually going to lead to an armed conflict between, say, the European Union and the US, or between Russia and the US, or even China and the US.  After the collapse of the Soviet Union, there has been a decidedly unipolar order.  In terms of concurrent transformations in the organic composition of capital and the corresponding historical periodicities of capitalism, we seem to have reverted to a “neoliberal” valorization of free markets and the deregulation of capital flows.  There is some debate as to whether neoliberalism is merely an ideological pretext that masks deep complicity with state powers, or whether it is a socioeconomic reality, but clearly the form of capitalism that Lenin felt specifically motivated imperialism in his time does not exist today.May

06

A Study of the Marxist (and Non-Marxist) Theory of Imperialism

The Death of Global Imperialism (1920s-1930s)

As part of my study of the spatial dialectics of capitalism, I have been reading not only the more recent Marxist literature by Henri Lefebvre on The Production of Space or David Harvey’s excellent Spaces of Capital, but also some of the more classic works on the subject.

Marx’s own account of the spatiality of capitalism can be found in the Manifesto of the Communist Party, his Grundrisse of the early 1860s, and his posthumously published Capital, Volume II.  In the Manifesto, he talks at length in the first section of the globality of capitalism, of the formation of the world-market as part of the historical mission of the bourgeoisie.  In the latter two works I mentioned, the spatial dimension of capital is raised in connection with the ever-improving means of transport and communication, in facilitating the circulation of commodities.  Marx explains the dynamic in capitalism by which it breaks through every spatial barrier that it comes across, such that it seems to embody a sort of terrestrial infinity realizing itself through time.

But I am interested in some of the later work that was done on the Marxist theory of imperialism, both before and immediately after the 1917 Revolution.  This would have an obvious bearing on the spatial extension of capitalism throughout the world.  In this connection, I have drawn up a brief reading list:

1. John Atkinson Hobson.  Imperialism: A Study (1902).  Though a pacifist and political liberal, Lenin considered his study of imperialism vastly superior to Kautsky’s, which had by then joined forces with the bourgeois apologists.
2. Rudolf Hilferding.   Finance Capital: A Study of the Latest Phase of Capitalist Development (1910).  This book was extremely influential in its time, and established a number of concepts regarding monopoly capitalism and finance capital that Lenin would later rely upon.  The two chapters on “The Export of Capital” and “The Proletariat and Imperialism” are relevant to any study on imperialism.
3. Rosa Luxemburg.  The Accumulation of Capital (1913).  This is Luxemburg’s greatest contribution to the economic theory of Marxism.  Though she and Lenin disagreed over some of its premises and conclusion, the book remains extremely important for the analysis of imperialism.  The chapter on “Foreign Loans” addresses this directly.
4. Vladimir Lenin.  Imperialism, the Highest Stage of Capitalist Development (1915-1916).  This work scarcely needs any introduction.  The entire book is a study of imperialism as a stage in capitalist development.
5. Nikolai Bukharin.  Imperialism and World Economy (1917).  This book, which includes a favorable introduction from Lenin, seems to me to perhaps be the most pertinent to my own studies, since it places the “world economy” as  a centerpiece for its analysis.

I am hoping perhaps a few of my Marxist friends will join me in reading some selections of these books.  In my understanding of the subject, the imperialism described by Hilferding, Luxemburg, Lenin, and Bukharin were very specific to the time in which they were living.  According to their theories, it involved vast capitalist trusts and cartels, gigantic monopolies, along with huge amounts of finance capital backing them through the banks.  I think that Lenin’s theory of imperialism is all too often invoked in describing present-day imperialist ventures.  It continues to be a force within the greater complex of capitalist globalization, which has been taking place ever since the social formation first emerged.  But historical conditions have changed since Lenin’s time, and in light of the neo-liberalist recalibration of capitalism, I think some of the fundamental categories we retain from Lenin’s analysis of imperialism might have to be rethought or slightly modified to accommodate present-day realities.

I personally am interested in the historical imperialism that Lenin et al. were studying, i.e. the form of imperialism that existed between 1880 and 1939.  Are there any other suggestions for reading on this subject? Ren, I’m looking to you.  But others are welcome to make suggestions as well.

thecharnelhouse.org

The Spectacle of War on Terror

An excellent article in New Left Review, available online, is a review of NLR's Verso publication Afflicted Powers Capital and Spectacle in a New Age of War
by the Retort Collective based in the Bay Area of San Fransisco.

A collective effort they use Situationist theory of the Spectacle to analyze the current Bush phony war on Terror.

In light of the Pentagon release of Al-Qaeda materials this weekend that show Osama bin Laden understood the importance of media imaging of his war on the U.S. especially the attack on 9/11. It was the unreal reality of TV imaging, that then created the market response of 'reality' TV.

Retorts analysis of this as a Spectacular War, a media war fought in images and through media including the internet, becomes important for the Anti-War movement and the Left to understand.

They also use the theory that the permanent war economy that the US has embraced is a form of primitive accumulation of capital, which is also discussed in an earlier article in NLR.

It is this analysis that I have also posited here, that capitalism as globalization still requires primitive accumulation of capital, war zones with the consequential piracy and brigandism that marks the earliest form of capital accumulation.

Julian Stallabrass: Spectacle and Terror

The central claim of the book is that, with the attacks of 9-11, the us state was wounded at the level of the spectacle and cannot endure this ‘image death’ or ‘image defeat.

The perpetrators were fully conscious of what they were about, were in fact Debordian in their thinking, reasoning that capitalism is dependent on the colonized social circuits that comprise spectacle—including confidence in the market and the state, and an identification with commodity culture—and that to disrupt spectacle may have great and unpredictable consequences. The attacks, Retort claim, were not atavistic pinpricks but modern politics, an assault above all on the ‘ghost sociality’ purveyed by the media The assault on spectacle, not on economic power or even people, was their main business, and in this sense they were for a short time remarkably successful.

There is much that can be said to qualify this view. The motivations of the bombers themselves may never be known, although Retort point to tracts on media theory found in Al Qaeda camps. They must indeed have known that the consequences of their acts could not have been accurately predicted, and this makes their political motives—as opposed to their religious ones, or the desire for just revenge—murkier still. Retort are correct that the void at the level of the image in the mainstream broadcast media was remarkable

In any case, it may be that the point of terror is not merely to disrupt spectacle by producing indigestible images, but to exceed it. Retort highlight the paradox of the vanguard Islamic revolutionaries, who deny themselves all that capitalist spectacle has to offer, and harden themselves against mundane sentiment and appetite, yet who still hold to the effectiveness of the image, and propagate images of their acts through websites. Just as in their lives and deaths they seek the unmediated, so their atrocities perform it, being designed to produce real, bodily fear (not the sublime of air shows), to blanket a city with the smell of fire and blood, to bring to a people sunk in spectacle the ineluctability of arbitrary death. The July 2005 London underground bombings were not meant primarily to create images, but to spread the terror of living burial among the cityÂ’s populace.

Retort argue that the result of the spectacular defeat of 9-11 has been to push the state into actions that are as much governed by spectacle as by material considerations. Warfare has been elevated from an intermittent action to permanent imperial conflict. They claim that one frequently repeated charge of the anti-war movement—that the war was fought for oil—when taken too simply, ignores the ‘partially non-factual imperatives of capital accumulation. These include the effort to repair spectacle, and the drive to normalize war in the minds of citizens.

Retort are surely correct to point to the state’s efforts to create images that can counter the memory of 9-11, and to their insufficiency: Bush on the flight-deck proclaiming victory in Iraq, Saddam’s statue toppled, the dictator captured, the SmokinÂ’ Marine who was supposed to embody the cool courage of the us armed forces, and so on. It is not that these were ineffective pieces of propaganda, but they have subsequently soured as the war and acts of terror have continued. The most memorable images so far gathered by the us armed forces in Iraq are those taken on the phone-cameras of the torturers of Abu Ghraib. Similarly, us political support for Israel is seen as no longer being driven by strategic or military considerations, which now would operate against such an alliance, but rather as an attachment at the level of the image: both are simultaneously democratic consumer societies and highly militarized states with a pioneer ethos, and both harbour the guilt and pride of having taken their land by expelling and exterminating another population. The us in seeing Israel looks into a mirror and cannot abandon its own reflected image.

Find blog posts, photos, events and more off-site about:
NLR, Retort, Osama, bin, Laden, Al-Qaeda, Spectacle, Debord, Situationist, War, Bush, 9/11, Iraq, Afghanistan, Terrorism,

Deconstructing Hayek

I came across this article on the web by Sean Johnson Andrews critical of the Regulation School of Economics that also handily dismisses the Austrian School of Economics so favored by Neo-Conservatives and Right Wing Libertarians.

[Author’s aside: I found it while researching material for Libertarian Anti-Imperialism, ah the joys of research based writing, it takes you off in all directions at once. And serendipitous synergies occur as happened in this case.[1] ]

Andrews study is about cultural production under capitalism, especially media concentration, and the whole article is an excellent read as are his other writings ( I have included a link to his article on blog freedom as a comment to my Blog Freedom or Cyberwar). He asks if bourgeois political economy which wants be taken seriously as a science but what kind of science and what kind of economics? He does an excellent job challenging the neo-classical school of the economics including its most radical wing the Austrian School of Economics from a libertarian dialectical position.

I have excerpted some of his critique from this long article, the whole of which is well worth the read. I have excerpted a small section of his very long article dealing with neo-classical economics of the Austrian and Chicago Schools of Economics as well as the new Regulation School of Economics.

Excerpts From: A Conversation among Bourdieu, Regulationist Economics and Cultural Studies and the way they can help objectify this and other conjunctures

The Science of Culture and the Culture of Science:

From Culture and Political Economy (Spring 2003)

Sean Johnson Andrews

Sean Johnson Andrews Blog on Media

Where, if anywhere, ideology leaves off and science begins has been the Sphinx’s Riddle of much of modern sociological thought and the ruthless weapon of its enemies. Clifford Geertz, The Interpretation of Cultures, 1973

At the present time, scientific effort mirrors an economy filled with contradictions. The economy is in large measure dominated by monopolies, and yet on the world scale it is disorganized and chaotic, richer than ever yet unable to eliminate human wretchedness. Science, too, shows a double contradiction. Max Horkheimer, “Notes on Science and the Crisis,” c.1930

The] neoclassical consensus succeeded in replacing the labor theory of value with one grounded in subjective utility and placed the ideas of ‘marginal product’ and ‘final demand’ at the center while elbowing into the wings the concepts of total demand. With these new ideas [. . .] the economy came to be thought of less in terms of material production and reproduction and more as a logic of human action. (79)

To make matters worse, this is the model of economics that is most strongly believed as rational and verifiable by a great many capitalist subjects.

The same social alchemy is true of economic capital and, like the capital in the scientific field, capital in the economic or symbolic field, legitimated by a hierarchy of producers, is more than just a mode of exchange: it is also a mode of domination.

Regulationist economics is concerned with “the study of the transformation of social relations as it creates new forms that are organized into structures and themselves reproduce a determinant structure, the mode of production”(16). This characterization of the economy seems similar to the Polanyian idea of embeddedness, which he describe in detail in The Great Transformation. In short, embeddedness is a way of giving primacy to one social formation over another. Polanyi insists that before the development of modern market capitalism in the 19th century, “the human economy was always embedded in society”(xxiii) and, more importantly,

The idea of a [disembedded] self-adjusting market implied a stark utopia. Such an institution could not exist for any time without annihilating the human and natural substance of society; it would have physically destroyed man and transformed his surroundings into a wilderness. Inevitably, society took measures to protect itself, but whatever measures it took impaired the self-regulation of the market, disorganized industrial life, and thus endangered society in yet another way. (3-4)

This is understanding of the relations between the economy, society and the state is, indeed, similar to the Regulationist view, but they tend to posit the agency with the market instead of with society. The concept of a Regime of Accumulation, central to the school, is not concerned with the effect of capitalism on society per se, but rather on the way that society can be best transformed to accommodate capitalism. It could be said that, in relation to Polanyi, they recognize that there are times when the relation between the two is unique. The concepts of a the predominantly extensive and intensive regimes of accumulation indicate this understanding. The former is the regime of accumulation which Polanyi might call “disembedded;” it is “that in which relative surplus value is obtained by transforming the organization of labor; the traditional way of life may persist or be destroyed, but it is not radically recomposed by the logic of utilitarian funcitonalism”(Aglietta, 71). This is the type of accumulation regime, according to Aglietta, which existed in late nineteenth-century America.

The crisis of worldwide depression and the rise of fascism that ensued when this accumulation regime could no longer continue is what Polanyi has witnessed when he says, in 1944, “nineteenth-century civilization has collapsed.” But whereas Polanyi thinks this is primarily the social result of an economic phenomenon, Aglietta describes it as a social phenomenon with economic consequences: “The Great Depression [. . .] was a major crisis of accumulation because the transformation of the labor process itself set up obstacles to valorization. What was at stake in the crisis was the transformation of the conditions of existence on the working class”(95).

What this understanding of capitalism points to is the “progressive, historical role of capitalism”(Lenin, 47) which Aglietta describes as only being fully possible in an intensive regime of accumulation, or some other “set of mechanisms for social mediation that guide the accumulation of capital in the direction of social progress”(Aglietta, 412). The description of he gives of this concept is important because it points to the place where Bourdieu’s understanding of habitus becomes relevant to the Regulationist description of capitalism:

The predominantly intensive regime of accumulation creates a new mode of life for the wage-earning class by establishing a logic that operates on the totality of time and space occupied or traversed by its individuals in daily life. A social consumption norm is formed, which no longer depends in any way on communal life [. . . .] This norm is stratified according to principles that closely correspond to the stratification of social groups within the wage-earning class. The intensive regime of accumulation accomplishes an integration of the two departments of production that makes possible a far more regular pace of accumulation and a far more rapid increase in the rate of surplus value.(71)

Packed into this quote are several ideas that become more fully articulated concepts in the hands of later Regulationist theorists. So, the “mode of life” which Aglietta mentions above, becomes a mode of regulation and the “logic that operates on the totality of time and space” is similar to Alain Lipietz’s description of a schema of reproduction (32-33).

Aglietta describes the major problem of capitalism in terms that are similar to Althusser and the conception of “capital” as quite similar to eponymous idea in Bourdieu: “we conceive of capital not as an eminent entity but as the development of the wage relation. Every major crisis of accumulation is a crisis of the present conditions of reproduction of this relation”(Aglietta, 169). The idea of a “schema reproduction” is something which is meant to stem this crisis in the production relation or the “reproduction of the material conditions of production”(Althusser, Lenin, 127). The schema of reproduction accounts for the relationship of labor, the relationship between departments of production, and the patterns of distribution and consumption which all together form “the skeleton of a regime of accumulation or a mathematical diagram of its social coherence”(Lipietz, 32). This system of relations is not necessarily planned or settled upon before it is implemented, it is just the schema that was “found” to work. And the schema works in so far as there is a “mode of regulation” that is appropriate: “If any schema is to be realized and to reproduce itself for any length of time, there must be institutional forms, procedures and habits which either coerce or persuade private agents to conform to its schemas”(33). Thus the “mode of regulation” is almost identical to the habitus.

In relation to Bourdieu’s capital, which again, Aglietta describes as a development of the relation, capitalism can be conceived in terms of a certain formalization of an economic field. However, there is a highly stratified relation between the people able to accumulate capital and the people who only serve as, what could be called, relational support, for their accumulation. Workers, whose laboring capacity may reward them with symbolic capital within the field of economic relations, are not typically able to accumulate enough of the economic capital (which their work valorizes) to change their position in the field. Thus there has to be a strong relation of domination within the field which encourages a disposition for the worker to continue to play this relational support role when it is clearly more in the interest of the capitalist for him to do so.

For unlike other, more settled sciences, economics has had a difficult history in convincing other practitioners from other sciences that it has the same sort of quantitative verifiability of mathematics or physics. Its status as a social science makes its seem less authoritative among other scientists. On the other hand, its status as a social science having to do with the basic relations of humankind gives its authoritative practitioners a great deal of symbolic capital, even as many of them attempt to disconnect their theories from the messy assemblages of power and production that they are supposed to describe. Friedrich Hayek, whose most famous book Road to Serfdom, was published the same year as Polanyi’s The Great Transformation, went to far as to suggest that the term “society” should be stricken from “our poisoned language” (Hayek, 112-115), making a point of not using the term to describe “our extended moral order” lest he be branded a socialist.

This dimension of the authoritative position of economics is evident enough in common parlance. Nevertheless, an example of an attempt to move outside of the scientific field to accumulate symbolic capital is visible on George Mason University’s home page in iterations such as “Welcome Nobel Laureate Vernon Smith.” As Yves Gringas points out in a short article about the “Nobel prize by association,” she traces a particularly clear case of “social alchemy:” “this so-called ‘Nobel prize’ is an extraordinary case study in the successful transformation of economic capital into symbolic capital, a transformation which greatly inflates the symbolic power of the discipline of Economics in the public mind.”

In 1968, the Bank of Sweden, interested in conferring a greater legitimacy on the discipline of economics, decided to offer a prize to the most innovative and important thinkers in the field and to dedicate it to Alfred Nobel, which was strange since he wasn’t an economist. However, the organizers in charge of the creation of the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel “ had its their own reasons for choosing Nobel. As Gringas tells it:

First, despite the skepticism of some scientists towards the ‘scientificity’ of economics, the Bank managed to convince the Royal Swedish Academy of Sciences and the Nobel Foundation to administer their prize. Secondly, identical procedures for the selection and nomination of the prize were chosen to those of the real Nobel prizes. Of course, the prize money would come from the Bank of Sweden, not the Nobel Foundation, but all the rest would be done exactly as if it was in fact a Nobel prize, up to and including the ceremony of 10 December.

Furthermore, since the full name of the prize is too onerous for people (especially journalists) to say, it became common parlance to call the prize “The Nobel Prize in Economics.” This work of social alchemy meant to solve the problem of the “primitive accumulation of symbolic capital”(Gringas) regarding this prize and its related field.

Of course not everyone has been happy about this. In 1974, when Gunnar Myrdel shared the prize with Hayek in 1974, he reserved his speech to advocate for the abolition of the prize. If Hayek was supposed to be the best an brightest in the field, then he wanted nothing to do with it. Nevertheless, the prize continues, despite the abyssal divide between what are arguably, ideological points of difference within the field itself. Which brings us back to the early 1970s and the intervention which Michel Aglietta was, arguably, attempting to make.

Fordism –or as the theoretical component was better known, Keynesianism—was obviously in crisis since both of the “cyclical” tendencies—stagnation and inflation—were happening at once; Althusser and others on the “New Left” were inspired both by world events and the appearance of any sort of crisis tendency in the capitalist system; and, perhaps more importantly, Hayek had just won the “Nobel prize in Economics” and Milton Friedman and the Chicago school were hard at work turning Pinochet’s Chile into a neo-liberal paradise. Finally, on a monetary level, abandoning the gold standard and replacing it with the “black gold” standard of recycled petrodollars was developing an extension of the financial markets and giving unprecedented control of world capital over to a “stratified oligopoly” of private banks. It was an important moment for economic science because, again, “history has infinitely more imagination than we do.” It was a moment when the flaws of the dominant economic model—and the theories that were supposed to explain it—were showing through. It was a good time to revert to a subversion strategy and, as a graduate student, Aglietta was in the sort of position Bourdieu recommends to make the heretical invention. But instead of saying anything too revolutionary, what he actually did was to begin by make an originally strong set of economic concepts into a set of symbolically legitimate equations: he rewrote the basic arguments of Capital, starting with one that Adam Smith himself would find it hard to contest.

As was said before, by Caporaso and Levine, the labor theory of value, a foundational concept in Marx’s Capital, had been disproven. Caporaso and Levine themselves, in their textbook which purports to explain economic theories, are unable to explain LTV without providing a neo-classical excuse for it. In the section supposedly devoted to the theories of Adam Smith, Ricardo, etc., they do not describe labor theory of value in any detail, but instead revert to the statement, “the theory runs into a number of analytical difficulties, which convinced modern economists working in the classical tradition to build a materialist basis for exchange by employing a distinct starting point also present in the classical theories: price of production”(47). They then go on to explain the changes to they make to equations of inputs and outputs (10t iron + 250 bu wheat + 100 hr labor…): “when labor enters as an input, it is really so much wheat, which went to produce the labor, and enters as an input through its product, the laboring capacity of the worker”(50).

Leaving aside the problems of all the naked, sickly, wheat-fed laborers sleeping on the factory floors and the ethical implications of this revolutionary new crop of wheat that evidently plows, plants, grows and harvests, mills and bakes itself, what is important is that Caporaso and Levine, while trying to present an overall balanced look at political economy, are unable to even consider the possibility that the Labor Theory of Value has any theoretical validity. Instead, it makes much more sense to think of things in terms of some monetary equivalent, the amount of which, in one way or another, “indicates the utility that the seeker recognizes in the materiality of the object sold or on offer” (Nadel, 29).

In other words, even though there have been many theorists in the tradition of Regulationist Political Economy, the dominant groups in the field of economics—especially anyone outside of France—namely the proponents of the neo-classical general equilibrium model taught in every ECON 101 classroom, did not want to acknowledge the possibility of an alternative model for the Labor Theory of Value, even to refute it: to do so would also be to consecrate it and admit that there was a legitimate challenge to the powerful agents and apparatuses, the Departments of Economic theory, all of which have a vested interest in keeping the current model functioning. Not only in terms of the field, which is largely based on these assumptions, but also of the market dominated society in which it operates and for which it provides a placating explanation. As Aglietta says, “If this theory has exercised such a dictatorship over economic thought, it is because it supplies a reassuring vision of society and a justification for the profession of economist”(10).

This, of course, brings us full circle to the central dialectical problem of the need for a simultaneous understanding of the culture of science and a science of culture. The former is something which Cultural Studies has done vigorously but not rigorously. The basic assumption was that one could simply understand scientific or even merely disciplinary claims as ideological cultural productions.

The project of cultural studies is an important one and the cultural significance of economic science is one of the most important ideological investigations we could undertake. There was a time when this type of discussion being engaged. Despite what Murdock and Golding have to say about the problem of “examining the economic base,” Stuart Hall, Raymond Williams and others began to present a system of concepts which attempted to illuminate the dynamic nature and role of culture—starting primarily in its very material nature. As Williams says in Marxism and Literature:

The insertion of economic determinations into cultural studies is of course the special contribution of Marxism, and there are times when its simple insertion is an evident advance. But in the end it can never be a simple insertion, since what is required, beyond the limiting formulas, is restoration of the whole social material process, and specifically of cultural production as social and material.(138)

Williams goes on to begin the project he continues in The Sociology of Culture in which the most basic task “is analysis of the interrelationships within this complex unity: a task distinct from reduced sociology of institutions, formations, and communication relationships and yet, as a sociology, radically distinct also from the analysis of isolated forms”(139). This loose set of concepts—as well as the many others he presents to describe cultural (as normally in the creative and/or artistic sense)—is developed with an eye to make the realm of cultural production describable so that the investigator could then position that process within the production relations.

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[1]

[Author’s aside. This is why I currently run four blogs and over the past decade have had multiple web pages. This log is for longer features, which is supplemented by my site at modblog for news over views of the current crisis state of capitalism and the resistance of capitalisms subjects. It is why my bloglines site has numerous news, activist and alternative news/blogs linked up to supplement my writings, to give an alternative to what is called consensus reality or the ruling ideas or the ruling class. To give readers more research links. And I can blow off some steam at that blog with my Devils Dictionary Redux.

And I have added a new blog this week; Heresiology-for the little heretic in each of us. This is for my other interests in cultural studies, the occult, esoterica, science, crypto science, and all aspects of popular culture, as the saying goes; all the news that doesn’t fit in these other blogs.]