Archive for February, 2012

Theories of the Current Crisis: John O’Connor, Neoliberalism and the Long Painful Death of the Nation State

February 25, 2012 1 comment

The modern state, no matter what its form, is essentially a capitalist machine — the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with. It is, rather, brought to a head. But, brought to a head, it topples over.

Frederick Engels, Socialism: Utopian and Scientific

I am now reading John O’Connor’s “Marxism and the Three Movements of Neoliberalism” (PDF)

O’Connor proposes what he calls a “Marxian conceptual and empirical framework for understanding the disparate research on neoliberalism”. As with Saad-Filho’s work, John O’Connor’s is deeply flawed and is not in any fashion based on Marx’s theory of the Capitalist mode of production. Rather than an exercise in historical materialist analysis, O’Connor serves up a rehash of progressive nostalgia for a mythical pre-1970s Keynesian social compact, combined with a laundry list of ideological and policy crimes by the Neoliberal world order. We end with no more understanding of this thing, Neoliberalism, within the context of history, than we did at the beginning. O’Connor fails the essential test of the historical materialist critique of the capitalist mode of production.

If Neoliberalism is simply an ideological, policy, or governance construct, why is this construct the necessary form of ideology, policy and governance at this stage of development of the mode of production?

Fascism and the Myth of Keynesian Social Accommodation

For some strange reason, O’Connor arbitrarily begins his narrative in 1950 — completely bypassing a decade of depression ending in world war . He wants us to ignore this catastrophe and the war of redivision of the planet that ended in the destruction of much of Europe and Japan — 80 million dead and the productive capacity of Europe and Japan laying in ruins. He also wants us to ignore the rise of the fascist state and the debasement of currency that made that war possible. This allows him to portray the period roughly from 1950 to 1974 as a “Golden Age of Capitalism” following Glyn and Hosbawm.

Completely ignoring the fact that Europe and Japan lay in ruins at the end of the war — and, therefore, that any measure of post-war expansion begins from a base determined by this previous horrific loss of productive capacity — O’Connor tells us the “post-war economic boom was exceptional in capitalist history for its explosive growth, high profits, technological innovation, and reliance on government policy.” This last thing “reliance on government policy” is the kicker, because O’Connor is now going to use it as a crutch to get him to 1974. The “Golden Age” was made possible by two things: class accommodation at home and state involvement in the accumulation process. We don’t get any critical look at this so-called class accommodation nor state involvement in the accumulation process. In fact, both are filler material, placed there solely to let O’Connor to segue into the “crisis” of 1974-82. With this filler material O’Connor can stuff in the typical myth-story about a “Golden Age”” which he finds already present in our national political discourse.

Gone is the Great Depression, the debasement of the currency and the rise of the fascist state, the catastrophic wars of the 30s and 40s, US aggression in Korea, and a series of other police actions and coups, the red scare, the arms race, the Suez incident, Vietnam and the horrors of the United States’ Southeast Asian murderous rampage. What was blood red in reality, becomes a hazy faint shade of pink in O’Connor’s make-believe world of “I Love Lucy”. At some point, someone is going to have to call Marxists out on their patriarchal, racist, elitist, Anglocentric, rewrite of history. Frankly, the shit is just fucking unnerving — there was no “Golden Age” of capitalism! For John O’Connor, Saad-Filho, Richard Wolff and the rest of the Marxist Academy to continue referring to this myth is just bizarre!

The period under question begins not in 1950, but in 1929 with the collapse of capitalism world-wide, from which capitalism never recovered. Rather, all industrial states stepped in as the national capitalist and immediately imposed a continuous wage reduction regime across the board on their respective working classes in a ruthless act of class warfare. Then each fascist state turned on its neighbors and slaughtered everyone they could get their hands on in an orgy of bloodletting. It wasn’t enough to kill them — NO! — they then leveled their cities, destroyed their  factories and productive capacity, and stole their resources to starve them out.

You want to see the “Golden Age” of Keyesianism — just look at World War II. Thanks to Lord Keynes the United States was able to devote 40% of its GDP to slaughter and pillage, and still have “economic growth”. In the United States alone 1500 factories were built from scratch to murder strangers — not feed them and ourselves. Sixteen million men were withdrawn from all productive labor and sent to murder, fully outfitted and fed by American industry — the same American industry which, just months earlier, could neither hire nor feed them — that’s your fucking Keynesian “Golden Age”, bitches.

The insult to the 100 million dead in two global wars of redivision cannot be worst than out of the mouth of a Marxist who states, as John O’Connor does, “the USA and Britain took steps to ensure that a stable liberal world order was recreated”.

The Second Great Depression

Having used this “Golden Age” of capitalism as a crutch to get him to 1974, O’Connor misses the beginning of the crisis in the 1960s. Had he done the least bit of analysis on the period 1929 to 1950 he might have noticed a little event called debasement of the currency. With this debasement, and the devaluation of wages by 70% that accompanied it, American capitalism went through an expansion phase. That expansion was not just fueled by the devaluation of wages, but also the war expenditures of World War II and the absorption of a hefty section of post-war Europe and Japan into the newly emerging fascist American Empire. This expansion phase comes to a head not in 1974, but in the mid-sixties with the collapse of the London gold pool in 1968 (pdf) , which facilitated manipulation of gold bullion price and allowed the US to share in the extraction of surplus value wrung from the European and Japan working classes — the so-called “exorbitant privilege”, a term coined by the French. (Of course, since Marxists are MARXist in name only, they have ignored the implications of the French critique.)

The crisis begins in the mid-sixties with a run on US gold reserves, and culminates in the collapse of Bretton Woods, and the end of dollar convertibility for settling international obligations. But this is just its superficial expression — what really happened is that the new productive capacity of Europe and Japan came online. For a period this overaccumulation was disguised by the murderous war on Vietnam and the swelling of American domestic spending to stem protests. But all of this comes to a head with the opening moments of the Second Great Depression of the 20th Century — the Great Stagflation. This depression triggers the collapse of Bretton Woods and the end of dollar convertibility by the Nixon administration. And it occurs not in 1974 but years earlier, although the actual expression of this crisis in unemployment is itself triggered by the massive inflation that occurs as Washington tries desperately to spend its way out of the contraction. Those of a certain age will remember Nixon declaring fatuously, “I am now a Keynesian in economics”.

The attempt to slow the contraction by a massive expansion of government spending ultimately fails and the Federal Reserve has to choke off credit in the midst of a depression to slow the inflation of prices. Nixon is gone, Gerald Ford is running around handing out “Whip Inflation Now” (WIN) buttons, and the Fed is trying to douse inflation with unemployment. None of this has any effect on the depression, however, which continues unabated for the next five or six years  — in other words Keynesian economic policy is overcome by the growing productive capacity of society and the dissolution of nation-state economic management begins.

Only at this point do we finally reach O’Connor’s dating of the initial emergence of what eventually becomes neoliberalism — the crisis has, by this time, gone on for nearly a decade.

Neoliberalism and the Demise of the Nation State

The easiest way to understand neoliberalism is to understand exactly what the fascist state accomplished that can now only be accomplished by its demise. The success of the fascist states rested on what O’Connor terms a “distinct structural, institutional, and class foundation.”

This state led monopoly capitalism, as described by Fine and Harris (1979), was marked by the socialization of economic activity, in which the state took an active role in the accumulation process. Economic socialization helped offset the unproductive costs of accumulation and the reproduction of the labor force (Gough and Eisenschitz 1996). Through a wide variety of non-market mechanisms, the state balanced the social nature of production with the private appropriation of capital.

Okay, I admit I haven’t a clue what this means — so I am going to parse it.

“State led monopoly capitalism” appears to be some sort of a distinction from the state-as-capitalist — a concept that is apparently alien to Marxists. What role does the state play in this “state led monopoly capitalism” – clearly it is not the capitalist, so is it leading the capitalists? So how is it leading them? And to where? Well, it appears to be leading them toward some “socialization of economic activity” — which is clearly not socialism, but “socialization”. Which is to say, the capitalist accumulation process, having grown beyond the control of various forms of private management, must at some point fall under the direct management of the state. How does this work? Well, the state takes “an active role in the accumulation process”.

Okay, now I am stumped. What exactly is “an active role in the accumulation process”?

O’Connor tells us that it “helped offset the unproductive costs of accumulation and the reproduction of the labor force”. So what are these unproductive costs of accumulation and the reproduction of the labor force? Clearly by “the reproduction of the labor force” O’Connor can only mean wages and (perhaps) a meager provision of public education and a national health system. Can the state add to wages, educate, or cure illness? Not likely, since it is a bloated parasite on society, it can’t even put a chicken in a single pot. Since the state creates nothing, and produces nothing, it can only “offset … the reproduction of the labor force” by driving wages down. Perhaps I got this wrong; perhaps the state can magically whip up a subsidy for wages by creating food, clothing, and shelter out of nothing. I am not as educated as fucking Marxists Academics, but it seems to me all O’Connor is suggesting is that the state devalues labor power!

Of course, I could be wrong. Maybe Obama is feeding the working class from that victory garden over at the White House.

And what are the “unproductive costs of accumulation”? How does the fascist state “offset” these costs pray tell me? Frankly, I have never heard of the term “unproductive costs of accumulation” before I read this paper — the term appears nowhere in Marx. Nowhere in three fucking volumes of Capital does Marx ever mention an animal going by the name of “unproductive costs of accumulation”. Even if we assume the state plays some role in offsetting these mysterious costs, there are only two classes for the distribution of the social product of labor: workers and capitalists. If the state is “offsetting the unproductive costs of accumulation” for the capitalists, it has to be taking it from the working class.

So when I parse O’Connor’s argument, “Economic socialization helped offset the unproductive costs of accumulation and the reproduction of the labor force”, I only get two things out of it: “devaluation of the wages of the working class” and “more devaluation of the wages of the working class”. Since I am not a Marxist, you probably can understand why I come to that ‘absurd’ conclusion. If I were a Marxist, I could invent another phantom source of value for the state to redistribute as wages and profits.

Once we get past the silliness about the Keynesian “Golden Age” of capitalism, it is clear neoliberalism is not in the least a switch from social accommodation between capital and wage labor to coercive competition as O”Connor argues, but simply an intensification of systematic impoverishment of wage labor, for which Keynesian state policy was, by the 1960s and 1970s, insufficient to realize. This does not in the least require any modification of Marx’s labor theory of value, nor any special explanations. It simply requires us to grasp national capitals behave just like privately owned capitals, but with grim consequences for both national sovereignty and national fiscal/monetary policy. Which means these national capitals, although for a time appearing quite permanent features of economic analysis, were always transitory and subject to the very same laws as determine the capitalist mode of production generally: equalization of the rate of profit, concentration and centralization of capital, overaccumulation, falling rate and mass of profit, a growing superfluity of capital, a growing mass of workers who fill the ranks of the industrial reserve, etc.

What is distinct about these national capitals, however, is the constitution of purely national political class struggles. The political contest between any class of wage laborers and their national capital is fought out within the context of a nation-state form that is rapidly approaching extinction. Already countries very close to the core of Europe have been stripped of their national sovereignty, not to mention peripheral nations. And the more these nations lose their sovereignty, the more indifferent they become to both their domestic working class and domestic capitalist class.

Theories of the Current Crisis: Saad-Filho and the “Crisis in Neoliberalism”

February 23, 2012 1 comment

There is a lot of material out there produced by Marxists trying to get their head around Neoliberalism and its role in the current crisis. So as part of my Occupy the Marxist Academy I am going to do a few posts on it.

First up: Alfredo Saad-Filho’s “Neoliberalism in Crisis: A Marxist Analysis”, which can be found here. Saad-Filho argues Neoliberalism is not simply an ideology or a set of policies, but the “current configuration” of capitalist accumulation. In particular, Neoliberalism is a response to the “structural problems of capitalist reproduction after the displacement of Keynesianism”.

Read more…

A Brief Sketch of the Political-Economy of the Fascist State (Revised and Extended)

February 20, 2012 2 comments

Introduction to this revision

On the Left there is a real prejudice that Paul Krugman’s Keynesian policy ideas represent a more humane form of capitalism than Obama, Bush, Geithner and Bernanke neoliberal policies. Or that state social spending represents a more moderate face of capitalism than calls to dismantle entitlements and welfare spending. Even anarchists like Chomsky or Marxists like Wolff buy in to this stupid proposition.

Let’s be clear about this: there is not a dime of fascist state spending on anything that is not aimed at prolonging the life of capitalism. There is not a single penny spent on the poor that is not aimed at anything but intensifying their poverty. We are talking about a class of cannibals that have ruthlessly leveled entire cities to gain a competitive industrial advantage. If you think capitalism has a human face, you should get your fucking head examined.

Henry VIII exterminated 70,000 men and women to force the working class to accept wage slavery. The folks who control wealth right now, slaughtered millions on every continent to accumulate it, yet we still have dumbasses in the movement who think Obama cares about the unemployed and about your health? We are facing a class of predators who would feed on your children if they thought it would give them a competitive advantage. These are people who will drive our species to the brink of an extinction level event, secure in the knowledge there is profit to be made.

Our limitation, naiveté, is the inability to imagine just how inhumanely they can act toward entire sections of humanity to make a buck. We on both the Left and Right can talk all we want about the Constitution or “human need”, but this is meaningless to these people. They have already told us “The Constitution is not a suicide pact.”

Translation: “Whatever we have to do, we will keep our monopoly over the wealth of society.”


Read more…

#OtMA: Wolff’s and Resnick’s “Marxian Interpretation” of the Crisis

February 14, 2012 4 comments

I have been contemplating these two paragraphs for a week now, because they seem to me to sum up the disconnect between Academic Marxism and the actual problems facing the working class today. The quote is taken from an article written by Richard Wolff and Stephen Resnick in 2010, titled “The Economic Crisis: A Marxian Interpretation”.

Indeed, the repeated oscillations between the two theories and their associate policy prescriptions emerge also from a fundamental perspective both sides share. They largely agree that the market system is the best of all known mechanisms to allocate resources efficiently. Many would add that markets also allocate resources equitably. They claim that fully competitive markets enable those who contribute to wealth production to receive rewards (incomes) exactly equal to the size of their contribution. Where the two sides differ is in how to insulate and protect the market system from the criticisms and movements for state economic interventions that flow from citizens who suffer from the economy’s recurring recessions and inflations. Against the criticism and movement, one side argues to ‘‘leave the market alone so that it can find its way to a new, efficient, and just solution.’’ ‘‘No,’’ says the other. ‘‘We need state intervention to help guide the market’s search for a new and efficient solution.’’ Capitalism-defined as private enterprise and free markets-remains the optimum system for both sides in terms of wealth creation and social welfare.

Both sides thus share a profound conservatism vis-a`-vis capitalism, despite holding radically different views on the need for state intervention. The oscillation between them serves their shared conservatism. It prevents crises in capitalism from becoming crises of capitalism, when the system itself is placed in question. It does this by shaping and containing the public debate provoked by crisis-caused social suffering. When serious crises hit a deregulated capitalism, the two sides debate whether the solution is regulation or letting the system heal itself. When serious crises hit a regulated capitalism, the two sides debate whether the solution is deregulation or more or different regulation. This effectively keeps from public debate any serious consideration of an alternative solution to capitalism’s recurring crises: namely, transition to an economic system other than and different from capitalism.

The argument Wolff and Resnick are making is not particularly original; in fact it simply repeats, without any critical analysis, the received wisdom of the two alleged competing views of fascist state economic policy — Keynesian and neoclassical — regarding their policy differences. The Keynesian school wants to regulate the economy, while the neoclassical wants to deregulate it. The neoclassical school wants to leave the market alone, while the Keynesian school wants the state to intervene in the market.

Wolff and Resnick then tell us that the two schools share a common belief in “private enterprise and free markets”, that makes them conservative capitalist alternatives, because they prevent crises from developing to the point where “the system itself is placed in question”, “by shaping and containing the public debate provoked by crisis-caused social suffering”.

Frankly, I don’t know what to make of this “Marxian interpretation” of the division within fascist state economic policy pundits.

First, even if Wolff and Resnick were correct that there is indeed two wings within fascist state economic policy pundits, it is not at all clear to me that these differences amount to “Regulate, regulate” versus “Deregulate, deregulate”. Wolff and Resnick never even bother to discuss whether there even is “private enterprise and free markets”.

Second, Wolff and Resnick argue these differences play merely an ideological function of containing the debate in society within certain tolerable limits. Their argument seems to suggest the point of the division itself is to serve as a safety valve that allows dissent from placing the “system” in question by redirecting public debate. Are there really no policy differences of material significance between the two schools? Is the debate over fascist state policy really all just misdirection?

Third, the last question gets to the heart of what is wrong with this “Marxian interpretation”: Wolff and Resnick offer an argument of sorts the explains the prescription differences within fascist state economic policy, but it does not explain fascist state economic policy itself. Why is there fascist state economic policy? Why was it necessary for the state to undertake a more or less continuous intervention in the economy since the Great Depression?

By contrast, Engels, speaking from the grave fully fifty years before the state undertook this continuous intervention in the economy, described it as the inevitable result of the working out of the historical materialist law of value:

In any case, with trusts or without, the official representative of capitalist society — the state — will ultimately have to undertake the direction of production. This necessity for conversion into State property is felt first in the great institutions for intercourse and communication — the post office, the telegraphs, the railways.

If the crises demonstrate the incapacity of the bourgeoisie for managing any longer modern productive forces, the transformation of the great establishments for production and distribution into joint-stock companies, trusts, and State property, show how unnecessary the bourgeoisie are for that purpose. All the social functions of the capitalist has no further social function than that of pocketing dividends, tearing off coupons, and gambling on the Stock Exchange, where the different capitalists despoil one another of their capital. At first, the capitalistic mode of production forces out the workers. Now, it forces out the capitalists, and reduces them, just as it reduced the workers, to the ranks of the surplus-population, although not immediately into those of the industrial reserve army.

But, the transformation — either into joint-stock companies and trusts, or into State-ownership — does not do away with the capitalistic nature of the productive forces. In the joint-stock companies and trusts, this is obvious. And the modern State, again, is only the organization that bourgeois society takes on in order to support the external conditions of the capitalist mode of production against the encroachments as well of the workers as of individual capitalists. The modern state, no matter what its form, is essentially a capitalist machine — the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with. It is, rather, brought to a head. But, brought to a head, it topples over. State-ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical conditions that form the elements of that solution.

Not to be misunderstood, Engels emphasizes in a footnote that this intervention would mark a new and different stage for the mode of production and would not just be a policy preference designed to play some ideological function:

I say “have to”. For only when the means of production and distribution have actually outgrown the form of management by joint-stock companies, and when, therefore, the taking them over by the State has become economically inevitable, only then — even if it is the State of today that effects this — is there an economic advance, the attainment of another step preliminary to the taking over of all productive forces by society itself.

Engels argues the continuous intervention in the economy forced on governments in all countries, beginning with the Great Depression, was the inevitable result of economic laws, having nothing to do with containing public debate within tolerable limits. He stated it would mark the displacement of the capitalist class by the state, which would from that point itself function as the capitalist exploiting labor. His argument suggests the debate between the camps within fascist state policy pundits is not merely playing the role of misdirecting public opinion. Instead, these two wings are arguing among themselves over the best policy the fascist state should adopt to maximize the exploitation of the working class.

#OtMA Why George Washington was a Revolutionary (according to Marx) and Why Marxists Just Don’t Get It

February 10, 2012 Leave a comment

This is my second response to JMP, who answered my previous response, #OtMA: A Reply To JMP, with the following statement: “Oh it’s all fine and good to call yourself an historical materialist, but if you make bizarre statements about the American Revolution, fail to understand its class content or the theory that was actually and HISTORICALLY used to structure said revolution, then you’re not a historical materialist.  You’re an idealist and your “historical materialism” is the historicism of Hegel, or at least Feuerbach.  Furthermore, when you ignore the content and meaning of world historical revolutions––those locomotives of history which form the principle of change for the historical materialist––then you are disappearing even further into the idealist universe.  To be an historical materialist is not to wax eloquent about what you think the theory is, but to engage the crude matter of history in an historically materialist manner: which that article failed to do in any way shape or form.  One must engage concretely with history and draw concrete concepts, not simply declare positions already proven erroneous by the momentum of revolutionary history.

This is my response to JMP’s argument:

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#OtMA: A Reply To JMP

February 9, 2012 2 comments

In a response to my post, #OtMA: Was George Washington a Maoist?, JMP, a blogger makes several claims against me in a post entitled, Without Revolutionary Theory… Among other things, JMP claims:

  • that I make the “same banal and confused claims certain sectors of the directionless left have been making for years.”;
  • that I am “demonstrating an inability to grasp both the movement of history and the historical meaning of theory.”;
  • that the American Revolution was “simply a war between brothers, the younger of whom wanted the right to exploit for itself…”;
  • that I am, “assuming that theory is nothing more than a bland act of expressing meaning after the fact of a revolutionary movement…”;
  • that I pretend my argument is not “a theorization of history and revolution”;
  • that my post, “‘occupies’ marxist academia merely by occupying a position within the ranks of marxist academia… it challenges nothing.”;

Well, I promise not to be blase’ or flippant in my response since the writer raises serious issues regarding my argument.

First, I want to concede, if I really need to, that my argument is a theory of the role of theory in the historical movement of society — JMP is correct on this. Since I have offered this theory, his accusation amounts to demand for me to reveal the premises of this theory. The premises of my argument are the premises of historical materialist method as outlined by both Karl Marx and Frederick Engels. These premises are available to JMP in both the German Ideology and the eleven Theses on Feuerbach. I think I need not expand on them, since I assume JMP is completely familiar with both works. If my argument that violates the premises of historical materialism as outlined in those texts, I hope JMP will bring the specific statements in question to my attention.

Assuming we agree on the premises of historical materialism offered by Karl Marx and Frederick Engels, JMP and I can together evaluate Lenin’s statement:

Without a revolutionary theory there can be no revolutionary movement.

What is Lenin stating here?

He is stating that the revolutionary character of a movement is not to be found within that movement, but arises from the ideas external to this movement that motivate it. To explain why a particular movement is revolutionary, our attention should be focused on the ideas and conceptions of its members and not on their actions.

Is this historical materialism?


It is an invention passed on by Lenin from European social-democracy. The source of this argument is not Marx or Engels, but the renegade Kautsky, who sided with his own capitalists in the Great War. Kautsky is actually quoted by Lenin in “What is to be done” as the authority for Lenin’s argument on the relation between theory and practice. Since most people are only familiar with Lenin’s formulation above, I want to quote it so everyone can see just how raw and elitist Kautsky’s argument really is.

Kautsky states:

In this connection socialist consciousness appears to be a necessary and direct result of the proletarian class struggle. But this is absolutely untrue. Of course, socialism, as a doctrine, has its roots in modern economic relationships just as the class struggle of the proletariat has, and, like the latter, emerges from the struggle against the capitalist-created poverty and misery of the masses. But socialism and the class struggle arise side by side and not one out of the other; each arises under different conditions. Modern socialist consciousness can arise only on the basis of profound scientific knowledge. Indeed, modern economic science is as much a condition for socialist production as, say, modern technology, and the proletariat can create neither the one nor the other, no matter how much it may desire to do so; both arise out of the modern social process. The vehicle of science is not the proletariat, but the bourgeois intelligentsia [K. K.’s italics]: it was in the minds of individual members of this stratum that modern socialism originated, and it was they who communicated it to the more intellectually developed proletarians who, in their turn, introduce it into the proletarian class struggle where conditions allow that to be done. Thus, socialist consciousness is something introduced into the proletarian class struggle from without [von Aussen Hineingetragenes] and not something that arose within it spontaneously [urwüchsig].

So, according to Kautsky, “socialist consciousness” — whatever that means — is not a product of the class struggle. Kautsky doesn’t offer any definition of “socialist consciousness”, but does classify this “socialist consciousness” as a science beside other modern sciences and argues “the proletariat can create neither the one nor the other, no matter how much it may desire to do so; both arise out of the modern social process.”

So, according to Kautsky, Lenin’s authority on the matter, science cannot be created by the working class, “The vehicle of science is not the proletariat, but the bourgeois intelligentsia…”

So, when we return to Lenin’s statement, we can amend it as follows:

Without the revolutionary bourgeois intelligentsia there can be no revolutionary workers’ movement.

Lenin is basically stating the working class movement owes its revolutionary character, not to its material position in society, but to the bourgeois intelligentsia who become its leaders.

Perhaps I am unfairly mischaracterizing or distorting Lenin’s argument in some way. Well, let’s let Lenin speak from the grave:

…there can be no talk of an independent ideology formulated by the working masses themselves in the process of their movement

Now, I suppose, JMP can parse this sentence to make say something else, but I have always loved reading Lenin because his shit was clearly spoken. There are no metaphysical gymnastics in Lenin’s writing; I don’t have to keep running to Wikipedia to find out what a word means. In Lenin’s argument, the working class is incapable of creating a revolutionary movement because it lacks the capacity to create a theory.

However, in the These on Feuerbach, we are called to “grasp the significance of ‘revolutionary’, of ‘practical-critical’, activity.” Marx appears to be arguing that human action itself has a practical-critical or revolutionary character that does not depend on the ideas held by the people performing those action. Earlier materialist philosophy, Marx argues,

forgets that circumstances are changed by men and that it is essential to educate the educator himself. This doctrine must, therefore, divide society into two parts, one of which is superior to society.

And, this is precisely the argument Kautsky advanced, and Lenin adopted in the case. The working class is not capable of creating a revolutionary practical-critical activity on it own; it must be led by the revolutionary bourgeois intelligentsia. The ugly history of Leninist sectarianism (aka vanguardism) essentially results from this notion that workers themselves are incapable of creating theory. It is a notion that theory must be brought in from outside the worker’s movement if this movement will have a revolutionary character. According to Lenin, communists are supposed to stand in front of the workers’ movement and declare:

“You are incapable of freeing yourself unless we lead you; your fight against capital is only a filthy commercial argument and can never become more than this, because you are incapable of creating your own theory.”

So JMP, let me ask you something: How’s that working for you?

I want to continue this discussion to touch on the other objections JMP makes above, but I want to be sure we are using the same methods of social criticism. So before, we begin discussing my criticisms of academic Marxism; before we address the question of whether I am criticizing academic Marxism from within academic Marxism; and, before we begin discussing whether my opinion reasserts a very common academic position that is opportunist and petty bourgeois, can we agree on terms of this discussion?

Those terms can be simply stated according to historical materialism:

Without a revolutionary movement there can be no revolutionary theory.

Do you hold to historical materialism or not?

It’s all about “The Thing” — you know, reality

February 8, 2012 1 comment

I’ve been reading Marx’s “Theses on Feuerbach“, and I love the way he talks about “The Thing” — you know, reality.


The chief defect of all hitherto existing materialism – that of Feuerbach included – is that the thing, reality, sensuousness, is conceived only in the form of the object or of contemplation, but not as sensuous human activity, practice, not subjectively. Hence, in contradistinction to materialism, the active side was developed abstractly by idealism – which, of course, does not know real, sensuous activity as such.

Feuerbach wants sensuous objects, really distinct from the thought objects, but he does not conceive human activity itself as objective activity. Hence, in The Essence of Christianity, he regards the theoretical attitude as the only genuinely human attitude, while practice is conceived and fixed only in its dirty-judaical manifestation. Hence he does not grasp the significance of “revolutionary”, of “practical-critical”, activity.

He calls reality, “the thing”, and he says Feuerbach treats “the thing” as an object of contemplation. The object isn’t engaged, it is contemplated; the object contemplated is not human activity, it is not subjective but an object. This idea reappears as the commodity fetish in Capital.

The four temperaments (Clockwise from top right: choleric; melancholic; sanguine; phlegmatic).

I think this is the entire secret of the failure of academic Marxism. It cannot grasp the categories of political-economy as human activity. Money is not the object “MONEY”; it is the division within the social activity of billions of individuals being carried on in isolation and without a plan. Once historical materialism uncovered the secret of money, the point was to abolish these divisions, not debate whether money is objective. In fact, money is only as “objective” as human productive activities are divided in reality.

Likewise, the state is only the expression of the divisions within civil society; it is only as “real” as the divisions within society and no more. The point Marx makes in relation to the state is the same as he makes with money — once the society is revealed as the basis for the state, society itself must be abolished. We keep focusing on “the thing”, long after we have already exposed “the thing” for what it really is: human activity as an object. “The thing” rules over us, dominates us, makes us miserable; yet, despite realizing it is only our activity, we treat it as the object.

The study guide on that accompanies Marx’s theses asks: “Isn’t this statement by Marx idealist?” I think this question is partly stupid, or, at least, worded stupidly. There is an element of this argument that appears to suggest we can change reality by changing our behavior — some argue, for instance, we can abolish money or the state simply by refusing to go along with them. But, Marx is not making that argument; he is proposing a diagnosis of social phenomenon — oppression, exploitation, hunger, want, etc. He is pointing to the root source of these social ills. By framing the question in philosophical terms, we miss the point of his argument. A better way to put it: Is Marx practicing social quackery?

Is Marx making a scientific diagnosis of social ills, or is he engaged in prescribing snake oil potions and voodoo; is he offering us some pseudoscience of unbalanced social humors. Marx is making an argument that the categories of political-economy are the perverse symptoms of human activity in specific historical circumstances. The problem is with society, not the state; production without a plan, not money; material relations, not ideas.

Marx really is not doing anything very extraordinary here; he is simply proposing a source of social illness as a medical doctor once proposed bacteria as the source of some physical illnesses — as opposed to demons or “unbalanced humors“. (Interestingly enough, bacteria as the cause of diseases actually dates to the Bronze Age — well before it was finally proposed by modern medicine as the source of illness.)

The argument is highly charged politically, because it basically says all these social ills are being created by our activity, not natural. Capitalism creates poverty; but, just as important, capitalism creates both money and the state. This implies capitalism is increasing the divisions within society along with its own development. And, by this I do not mean the division between social classes — which actually grows more simplified over time; I mean the divisions within each class, which begin to approach a state of pure atomization.

The upshot of the first of Marx’s theses is that the conclusions he reaches will be scientific, independently discoverable, objectively verifiable, and disprovable. He is proposing a scientific approach to social criticism that is a natural science and should be treated as one.

Capitalism without Crises?

February 6, 2012 Leave a comment

At the end of his paper, Fred Moseley makes several statements that are important to parse. (PDF: )

This conclusion suggests that the debate over whether or not gold still plays a role in the function of measure of value in today’s economy is less important for Marx’s theory than previously thought. Whether or not gold still plays such a monetary role, i.e. whether it is assumed that credit money represents SNLT directly by itself, or indirectly through gold, it does not make any difference to the quantitative determination of the MELT in Marx’s theory. In both cases, the MELT is equal to the ratio Mp V / L, as in equation (7). Therefore, it also does not make any difference to the determination of the aggregate price level, nor of the total surplus-value produced.

Moseley argues Marx’s theory of money can be dispensed with, since it plays no role in determination of value, prices, and surplus value. As a practical matter, Moseley appears to be right on this: even in the absence of commodity money, labor produces value and surplus value. And, commodity money plays only a symbolic or token role in prices. Finally, if I interpret Marx correctly, money and the circulation of commodities occupy antagonistic poles not only in circulation itself, but between circulation, on the one hand, and a hoard of gold, on the other. Which is to say, between capital (as wealth in circulation, as self-expanding value) and money (as wealth at rest.).

If capital was not prone to crises arising from the mode of production itself, money in Marx’s sense of that term would be unnecessary. This is the side of the equation that Moseley grasps onto as if it is the whole of Marx’s theory of money. Mosley’s argument requires a capitalism without overaccumulation (overproduction) of capital, without crises and stoppages of industry. Once all these elements of capitalism are reintroduced into his argument, that argument collapses and must collapse. Now, the circulation of commodities is no longer smooth and unvarying, but subject to interruptions, imbalances, even periodic collapses. During these periods of crises what serves as money is of acute importance — it cannot be symbolic or token money, but must be actual gold.

During crises, the nominal value of token money, bills of exchange, derivatives, bonds, etc. vanish — as is happening right now in Europe. This devaluation of token money and credit money is expressed as the sudden appreciation of gold “prices” against all symbolic monies.

What remains to be shown is that even if we assume no overaccumulation, crises or industrial stoppages, Moseley never shows in his paper that symbolic or token money can not only serve as measure of the value of commodities, but actually materialize this value in its own form — these two are not the same thing.

To understand the difference consider the difference between labor power employed to produce an automobile or a manicure, and that employed to clear an occupation, or a village in Afghanistan. In the first case labor power is employed to produce a thing having value — even if this employment itself produces no material object. In the second case labor power is not employed to produce anything but broken bones and corpses. In either case tokens can be used to purchase the labor power employed, but only in the first case does the labor power replace its value.

If we consider the capitalist mode of production as the continuous circulation of value through the process of self-expansion the result is obvious: in the first case we get not only the replacement of the value of the labor power, but an additional surplus value; while, in the second case, we get neither replacement of the value of the labor power, nor any
surplus value — just piles of dead bodies.

The quantity of value in circulation has undergone a contraction in the second case of unproductive employment of labor power. Yet, there is no alteration of the quantity of symbols of money in circulation. While it is true these symbols of money now expressed the diminished quantity of values in circulation just as readily as they did the larger quantity previously, it is also clear that they express it the same way a bucket expresses the quantity of water it contains. There is, in fact, no way to tell how much water there is in the bucket merely by examining its outside. Is the bucket full? Half full? Or, empty? Does the bucket contain only water, or does it also contain oil or some other contaminant? If the bucket contains both water and oil, in what proportion are the two liquids present in the bucket.

The fact is, according to Marx’s theory of money, with debased tokens of money it is impossible to separate the socially necessary expenditures of labor time, from labor time that is wasted and unproductive. Without the ability to distinguish between the productive expenditure of labor time and unproductive expenditure of labor time we are led into the fallacy of neoclassical economic theorists who propose the prices of commodities are identical with their values. And, that the total sum of prices of commodities in circulation is identical with the total sum of values of those commodities.

When Andrew Kliman admitted that MELT is not a diagnostic tool, he was admitting that MELT was unable to distinguish socially necessary labor time of society, from labor time that is totally wasted and unproductive. But, the entire point of the social revolution is predicated on just this material differentiation. The whole of the struggle between the two great classes of capitalist society is a fight over what is socially necessary labor time. This takes the immediate form of the fight over the division of the social labor day between wages and profits, i.e., between value and surplus value. But, in the final analysis, it is a fight over labor time that is socially necessary in both these categories, and labor time that is superfluous to either category.

Gold and Exchange Rates (Random thoughts)

February 5, 2012 Leave a comment

This is very geeky, sorry. I posting it because I intend to revisit it sometime in the near future in the context of a review of the Euro-zone crisis.

My post on Moseley’s MELT paper (pdf) argues the so-called “price of gold” is actually the standard of price for a currency. I argued in the paper that dollars do not buy gold, gold buys dollars. Dollars are “sort of” a commodity necessary to convert gold into capital. I said “sort of”, because I really cannot describe it, except along the line of Marx’s argument on loaned capital:

M ==> M ==> C.

Where the first M is the bank’s money to be loaned, and the second M is the actual conversion of this loaned money into industrial capital. We could think of the movement of gold similarly as:

Mg ===> Mc ===> C.

Where Mg is a quantity of gold, Mc is a quantity of a particular currency, and C is the commodity.

The owners of gold, however, have a choice of currencies whose bodily form their gold can assume: euros, dollars, yen, yuan, reals, pesos, etc. And, each of these currencies have their own standard of price, i.e., their own specific exchange rate with gold. Each of these standards of price is an expression of the quantity of a given currency in domestic circulation to the quantity of domestic socially necessary labor time. Since, in each country, the relation between the total currency in circulation and total socially necessary labor time is different, the standard of price for each country currency must necessarily be different.It would seem to follow from this that the relation between currencies, their relative exchange rates, should be determined by the above. For instance, if country A has a standard of price with gold of 10 currency A units per ounce of gold, while country B has a standard of price of 20 currency B units per ounce of gold, the relation between the two should be:

one unit of currency A = 2 units of currency B

However, just as different industries have different composition of capital, so different nations have different compositions. The composition of capital in the US is far higher than that of the People’s Republic of China, or Zimbabwe. The movement of gold between currencies, I think, is determined much like the movement of capital between industries. On the one hand, the standard of prices in various countries arise from the domestic quantitative relation between the currencies and socially necessary labor time. On the other hand, for the owners of gold, these currencies are no more than forms gold must take if it is to become capital — and capital is self-expanding value, the production of surplus value through the consumption of labor power.

This suggests that although the standard of price of a currency is determined solely by the relation between the mass of currency and the mass of socially necessary labor time; it is also being determined by the rate of surplus value within each country as determined by their varying compositions of capital.

I think we are again face to face with Marx’s transformation problem, where the law of value confronts the law of average rate of profit. One law suggests the standard of price of a currency is determined solely by the relation between the total quantity of currency in circulation domestically and the total quantity of socially necessary labor time; the other law suggest the relative exchange rates among all currencies is determined by the law of the average rate of profit. The latter law suggests currencies are exchanging in the world market above or below their actual domestically determined standard of prices.

What use might this argument have?

  1. This might just offer an idea how, without violating Marx’s labor theory of value, imperialist super-profits are obtained.
  2. It could offer a way of modeling the emergence of world market prices, and the dollar as world reserve currency.
  3. It could also explain the empirical data, which shows neoliberal free trade policies produced a US expansion in the 1980s and 1990s.
  4. Finally, it explains why China’s currency appears undervalued on the world market and the US dollar overvalued against what we would expect.

#OtMA: Was George Washington a Maoist?

February 4, 2012 Leave a comment

In my Occupy the Marxist Academy commentary for today, I want to throw out some ideas about the role of theory in the social revolution. This is a very sensitive topic that has, on several occasions, thrown the entire movement into chaos. Nothing I say will be profound, or epoch changing. Instead it will consist of some observations.

My first observation is theory is not all that it is cracked up to be. Theory as THEORY is not a necessity for the social revolution. No social revolution failed for lack of theory, although many failed for lack of other things. Even if we disagree with the results of the Russian Revolution, the Chinese Revolution, or even the American Revolution they were successful — and their success is an empirically verifiable historical fact. But, success or failure of a social revolution is neither proof of a theory nor does its failure disprove a particular theory.

Social revolutions are empirical events which bring out masses of people for any number of empirically determined reason. Theory plays no more role in such events than it does in the far larger and more significant market events of every day life. In social revolutions, as in daily market activities, people are motivated primarily by their empirically perceived interests. What changes in a social revolution is not these empirically perceived interests, but material conditions themselves.

Let me give an example: the birth of the labor movement in the 19th Century was expressed in a general social demand by working people for freedom from work — for a shortening of the social work day. Marx, in fact, called the struggle over hours of work the Magna Charta of the the labor movement.

Yet, by 1941, on the eve of United States entry into World War II, Roosevelt was proposing the so-called Four Freedoms, among which freedoms included “the freedom” of working people to work longer and harder to create a massive armaments industry:

Every realist knows that the democratic way of life is at this moment being’ directly assailed in every part of the world… The need of the moment is that our actions and our policy should be devoted primarily—almost exclusively—to meeting this foreign peril. … [T]he immediate need is a swift and driving increase in our armament production. … I also ask this Congress for authority and for funds sufficient to manufacture additional munitions and war supplies of many kinds, to be turned over to those nations which are now in actual war with aggressor nations. … Let us say to the democracies: ‘…We shall send you, in ever-increasing numbers, ships, planes, tanks, guns . …’

We go from Freedom FROM work, to freedom TO work in the space of 100 years. How the fuck did that happen? Clearly there was a massive transformation of the material relations in society, such that separation from wage labor — unemployment — became the general social enemy. While theory did not cause this separation in any case, it might help us to explain what happened.

So, given the above, what is the role of theory? And, why does theory remain a problem for all variants of communist thought?

I think this can best be shown by the split in the International Workingmen’s Association between Marxists and anarchists in the 19th Century. The role of theory is very limited in relation to the social revolution, but it can throw light on the possibilities of that revolution. The split in the IWMA was not about the social revolution itself, but what various theories proposed as the possibilities or limitations for it in the late 19th Century.

We should be clear on this: theory did not have any impact on the social revolution itself, but on how we perceived its possibilities and limitations at a particular point in history.

The point in contention between Marx and Bakunin in the late 19th Century was not whether the state must be abolished, but whether this was immediately possible in those specific conditions. Now, it is possible to make this difference more profound than that — stretch it beyond such particularities and propose that different views had to lead to different strategies.
However, we still have to face the facts that these different strategies themselves had no impact on the success or failure of the social revolution per above.

To make this point perfectly clear: the American Revolution was not successful because George Washington was guided by brilliance of Marxism-Leninism-Mao Zedong Thought.

And, the differences between Marx and Bakunin do not explain how society gets from “freedom FROM work“, to “freedom TO work“. Marx’s theory did not get us here, nor did Bakunin’s theory. The conclusions Marx drew were conflict with the conclusions Bakunin drew regarding the possibilities in the late 19th Century and nothing more. At its best — “right” or “wrong” — all any theory can tell us is what the possibilities are for the social revolution now.

Let me rephrase that: No theory can tell us anything except what we can realistically hope to accomplish now! Theory can’t accomplish the social revolution “for us“, or “despite us“, or “on our behalf“, or “in our best interests“. Theory is not the cause of a social revolution’s success or failure.

Theory is nothing more than a tool, like a toilet bowl scrubber or a jack hammer — all the skill and art is in the hands of those who use it, not the instrument itself.