(PDF) Fragile Juggernaut Brill

41mm STUDIES IN POLITICA L ECONOM Y OF GLOBA L L A BOR A ND WOR K | 6 Series Editor Immanuel Ness BRILL.COM/PELW ISSN: 2667-288X ISBN 978-90-04-70836-5 THE FRAGILE JUGGERNAUT Harry Cleaver is Associate Professor, Emeritus, at the Department of Economics, University of Texas at Austin and author of Reading Capital Politically (AK Press/Anti-Thesis, 1979 and 2000), Rupturing the Dialectic: The Struggle Against Work, Money, and Financialization (AK Press, 2017) and 33 Lessons on Capital: Reading Marx Politically (Pluto Press, 2019). Harry Cleaver Whether loving or hating it, many visualize capitalism as an unstoppable juggernaut. For those of us who would defeat it, we must identify its weaknesses. Fortunately, Marx and Engels’ writings on “crisis” reveal them. They show how its endless imposition of exploitative and alienating work creates such antagonistic conflicts everywhere as to make it, ultimately, a far more fragile monster than it first appears. Each of its efforts to shape social relationships, subordinating them to the work of commodity production and its control over society, has been and can be thrown into crisis by those of us resisting its way of life and seeking to create more appealing alternatives. PELW | 6 STUDIES IN POLITICA L ECONOM Y OF GLOBA L L A BOR A ND WOR K | 6 THE FRAGILE JUGGERNAUT Marx & Engels on Capitalism, Class Struggle and Crisis Harry Cleaver The Fragile Juggernaut Studies in the Political Economy of Global Labor and Work Series Editor Immanuel Ness (Brooklyn College, The City University of New York, USA, and University of Johannesburg, South Africa) Editorial Board Amiya Kumar Bagchi (Institute of Development Studies Kolkata, India) Eileen Boris (University of California, Santa Barbara, USA) Jeannette Graulau (Lehman College, The City University of New York, USA) Yu Huang (Minzu University of China, China) Marcel van der Linden (International Institute of Social History, The Netherlands) Trevor Ngwane (University of Johannesburg, South Africa) volume 6 The titles published in this series are listed at brill.com/pelw The Fragile Juggernaut Marx & Engels on Capitalism, Class Struggle and Crisis By Harry Cleaver leiden | boston This is an open access title distributed under the terms of the CC BY-NC 4.0 license, which permits any non-commercial use, distribution, and reproduction in any medium, provided the original author(s) and source are credited. Further information and the complete license text can be found at https://creativecommons.org/licenses /by-nc/4.0/ The terms of the CC license apply only to the original material. The use of material from other sources (indicated by a reference) such as diagrams, illustrations, photos and text samples may require further permission from the respective copyright holder. Cover illustration: Hindu Juggernaut chariot. © Library of Congress (public domain). The Preface was originally published in the online web journal The Commoner, Issue 05, Autumn 2002. Appendix 1 was previously published in Teoria kryzysu jako teoria walki klas (Poznań: Wydawnictwo A+, 2017). Library of Congress Cataloging-in-Publication Data Names: Cleaver, Harry, 1944- author. Title: The fragile juggernaut : Marx & Engels on capitalism, class struggle and crisis / by Harry Cleaver. Description: Leiden ; Boston : Brill, [2025] | Series: Studies in political economy of global labor and work, 2667-288X ; volume 6 | Includes bibliographical references and index. Identifiers: LCCN 2024030807 (print) | LCCN 2024030808 (ebook) | ISBN 9789004708365 (hardback) | ISBN 9789004708631 (ebook) Subjects: LCSH: Financial crises–Philosophy. | Financial crises–Europe–History–19th century. | Capitalism–Social aspects–Europe. | Marx, Karl, 1818-1883. | Engels, Friedrich, 1820-1895. | Marxian economics. Classification: LCC HB3714 .C58 2024 (print) | LCC HB3714 (ebook) | DDC 338.5/42–dc23/eng/20240801 LC record available at https://lccn.loc.gov/2024030807 LC ebook record available at https://lccn.loc.gov/2024030808 Typeface for the Latin, Greek, and Cyrillic scripts: “Brill”. See and download: brill.com/brill-typeface. issn 2667-288X isbn 978-90-04-70836-5 (hardback) isbn 978-90-04-70863-1 (e-book) doi 10.1163/9789004708631 Copyright 2025 by Harry Cleaver. Published by Koninklijke Brill BV, Leiden, The Netherlands. Koninklijke Brill BV incorporates the imprints Brill, Brill Nijhoff, Brill Schöningh, Brill Fink, Brill mentis, Brill Wageningen Academic, Vandenhoeck & Ruprecht, Böhlau and V&R unipress. Koninklijke Brill BV reserves the right to protect this publication against unauthorized use. This book is printed on acid-free paper and produced in a sustainable manner. Juggernaut Originally, a British colonial misspelling of Jagannath, one title for the Hindu God Vishu, the noun juggernaut has come to refer to “a massive inexorable force, campaign, movement, or object that crushes whatever is in its path” (Merrium-Webster Dictionary). The “object that crushes” comes from early reports that some worshipers threw themselves under the wheels of the huge Jagannath chariots towed through the streets in public Ratha Yatra ceremonies. Translated as “Lord of the World,” Jagannath or Juggernaut seems a good characterization of how capitalists (and some critics) understand their system and its role in the world. Harry Cleaver ∵ Contents Preface (2024) xi Preface (2002) xv 1 Introduction 1 1 Work, the Vulnerable Heart of Capitalism 2 “Class” and Class Struggle 4 3 Capitalism, the Fragile Juggernaut 7 4 What Constitutes a Crisis? 9 2 Marx & Engels’ Studies of Crises, 1843−1895 13 1 The Early Studies: 1842−1852 19 1.1 Paris and Manchester 24 1.2 Brussels 38 1.3 Paris 45 1.4 Cologne 46 1.5 London 48 2 Years of Theory, 1857−1867 55 2.1 From Notes to Weighty Tomes 55 2.2 The First International (1864–1876) 59 3 After Capital, 1867−1895 62 3.1 A New Terrain of Struggle: Electoral Politics 63 3.2 Continuing Conflicts within the First International 64 3.3 War and the Paris Commune 67 3.4 Revisions and Translations 74 3.5 Working Class Parties and Debates 76 3.6 Marx: Critique of the Gotha Program 78 3.7 Engels: Anti-Dühring 80 3.8 Engels: Socialism: Utopian & Scientific 86 3.9 Engels: the Dialectics of Nature 87 3.10 Periodical Crisis Becomes Permanent Stagnation? 89 3.11 The Second International 93 3.12 Engels: Sources and Circulation of Crises 94 3 Marx’s Theory of Accumulation 96 1 A “Labor” Theory of Value? 98 2 The Material Circuits of Accumulation 102 3 Three Observations 109 4 Omnipresent Conflict; Omnipresent Struggle 5 Conditions of Reproduction 116 2 114 viii 6 Contents Accumulation in Terms of “Value” 119 6.1 The Substance of Value 121 6.2 The Measure of Value 122 6.3 The Form of Value 124 4 The Possibilities of Crisis 127 1 Markets & Crisis 128 2 And in Capitalism Per Se 131 3 Possibilities of Crisis in the First Stage of the Circuit: Investment 134 3.1 Possible Crises in Gathering Enough Money, M 134 3.2 Possible Crises in Obtaining Labor-power 141 3.3 Possible Crises for Buyers of the Means of Production, M – MP 170 4 Possibilities of Crisis in the Second Stage of the Circuit: Production 182 4.1 Possible Crises with Labor-Power, LP in … P … 183 4.2 Possible Crises in Means of Production, MP in … P … 188 4.3 Possible Crises Caused by a Rising Organic Composition of Capital 196 4.4 Possible Crises Due to a Tendency for the Rate of Profit to Fall 198 5 Possibilities of Crisis in the Third Stage of the Circuit: Sales 203 5.1 Possible Crises in Selling Slaves, C(LP) – M′ 204 5.2 Possible Crises in Selling C(MS)’ or C(MP)’ 204 5.3 Credit, Debt, and Commercial Crisis 217 5.4 Summarizing 222 5 Predispositions to Crisis 226 1 Predispositions in the First Stage of the Circuit: Investment 227 1.1 Forces Limiting Access to Money for Investment, M 228 1.2 Forces Interfering with the Supply of Labor-Power, LP 231 1.3 Forces Causing a Shortage in the Supply of the Means of Production, MP 241 2 Predispositions in the Second Stage: Production 241 2.1 Predispositions to Breakdowns in Labor-Power, LP 242 2.2 Predispositions to Breakdowns in the Means of Production, MP 249 2.3 Predispositions to Increasing the Organic Composition of Capital 255 2.4 Predispositions to a Falling Rate of Profit Tendency and Its Crises 258 Contents 3 4 5 ix Predispositions in the Third Stage of the Circuit: Sales 260 3.1 Predispositions to Crises in Selling Slaves, C(LP) – M′ 261 3.2 Predisposition to Crises in Markets for C(MS)’ or C(MP)’ 262 3.3 Predispositions to Credit Crises 273 The Circulation of Breakdown 278 4.1 Quantitative and Qualitative Change 279 4.2 Circulation of Crisis within Individual Circuits 281 4.3 Circulation of Crisis among Interconnected Circuits 283 Linkages among Tendencies 291 6 Offsetting Strategies and Their Contradictions 297 1 Force 297 2 Laws: Writing and Enforcing 299 3 Ideology: Ideas, Institutions and Behavior 303 4 Strategic Ideas 310 5 Apologetic Ideas 311 6 Structural Changes 315 7 Offsets in the First Stage of the Circuit: Investment 316 7.1 Getting Enough Money 316 7.2 Fixing the Supply of Labor-Power 323 7.3 Offsetting Crises in Buying the Means of Production, M – MP 347 8 Offsets in the Second Stage of the Circuit: Production, … P … 355 8.1 Countering Breakdowns in Labor-Power 355 8.2 Countering Breakdowns in the Means of Production 366 8.3 Offsets to Crises Due to Rising Organic Composition of Capital 369 8.4 Offsets to the Falling Rate of Profit Tendency 371 9 Offsets in the Third Stage of the Circuit: Sales 374 9.1 Dealing with Crises in Selling Slaves, C(LP) – M′ 374 9.2 Dealing with Crises in Selling C(MS)’ or C(MP)’ 377 9.3 Dealing with Crises in Selling the Means of Production, C(MP)’ – M′ 387 9.4 Countering Credit and Commercial Crises 392 10 Offsets to the Circulation of Breakdown 393 10.1 Dealing with Qualitative Change 394 10.2 Blunting Circulation within Individual Circuits 396 10.3 Blunting Circulation among Interconnected Circuits 402 7 Crises as Solutions to the Contradictions of Accumulation 1 In the First Stage of the Circuit: LP – M/M – LP 406 405 x Contents 2 3 In the Second Stage of the Circuit: …P… 409 In the Third Stage of the Circuit: C′ – M′ 412 8 Crisis and Revolution 416 1 Revolution: Another Amoebic Term 417 2 “Revolution” as Used by Marx and Engels 418 Appendix 1: Note to Polish Readers (2016) 426 Appendix 2: Annotated Bibliography of Marx and Engels’ Writings on Crisis 453 Index 521 Preface (2024) This book presents a comprehensive analysis of Karl Marx and Friedrich Engels’ writings on crisis, highlighting the key role played by the struggles of workers throughout capitalism’s organization of society. Its origin is an essay, “Marx’s Theory of Crisis as a Theory of Class Struggle,” which I wrote in collaboration with Peter Bell, originally published in 1982. Since then, I have repeatedly revised the essay and in the process considerably amplified it. To this most recent revision I have added: this foreword, an earlier preface, and an annotated bibliography of Marx and Engels’ writings on crisis which I compiled while doing the research for this book. The original essay, intended to be the opening chapter of a book, was pared down for publication in the series Research in Political Economy, edited by Paul Zarembka.1 “Paring down” involved condensing the essay – to a length compatible with its inclusion in a collection – mainly by leaving out some of the argument, some quotations from Marx and Engels’ writings and a great many footnotes. In the present, revised, and amplified version of the essay I have reincorporated much of what was previously left out, including extensive footnotes to the material upon which it is based, and added new material based on my continuing research and thinking about what I have found since 1982.2 The two prefaces were occasioned by the publication of revisions of the essay in 2002 and 2016. I provided the 2002 preface as background to the essay’s inclusion in a special issue of The Commoner, an online journal edited by Massimo de Angelis.3 The 2016 preface, “Note to Polish Readers,” was written for a Polish translation of the original essay published as a book.4 That “Note” is included here as an Appendix because it adds to both the essay and the earlier preface in two ways. The first part provides considerable detail on Marx and Engels’ writings on crises in Poland – thus adding to the essay’s sketch in 1 Peter F. Bell and Harry Cleaver, “Marx’s Crisis Theory as a Theory of Class Struggle,” Research in Political Economy 5 (1982): 189−261. 2 A note on authorship. Although I wrote the original 1982 essay, it was the product of an active collaboration between myself and Peter Bell, so we were both cited as authors. At the time, if I remember correctly, Peter was drafting a chapter critiquing Paul Baran and Paul Sweezy’s writings on crisis. We subsequently abandoned our book project in favor of directing our efforts to what seemed like more pressing matters, e.g., the neoliberal assault on the working class in the 1980s, both at home and abroad. I originally attributed the two prefaces to both of us, due to our original collaboration and on the assumption that Peter would eventually return to work on this subject. He has not done so, therefore – at his suggestion – here I take full and unique credit (and blame) for both prefaces, for the substantial amplification of the original essay and thus, for the book as a whole. 3 https://thecommoner.org/back-issues/issue-05-autumn-2002/ 4 Teoria kryzysu jako teoria walki klas (Posnań: Wydawnictwo A+, 2017). xii Preface (2024) Chapter 2 of the evolution of their writings on crisis. The second part takes up the issue of assessing the relevance of these old writings to contemporary crises, both in general and in the specific case of Poland. In that preface I wrote: We have insisted, repeatedly, that our interest in Marx and Engels’ writings is not philological but political. We have not intended our reinterpretation to be just another contribution to the analysis of the history of thought, but rather one that uncovers how, and in what ways, these old ideas can help us cope with new problems, especially the constraints imposed on our lives by contemporary capitalism. Today, we are two decades into the twenty-first century. Obviously, a lot has changed since our two authors wrote. Yet, despite many changes, crises of all sorts are still very much with us. Are Marx and Engels’ thoughts from so long ago still relevant? Are the sorts of crises they addressed like the crises that you face today and to what degree, if any, do their analyses illuminate your present problems and can usefully inform your strategies of struggle? These questions, I felt, would inevitably be raised by readers in Poland, long alienated from Marx due to the ways the Soviets and their local clients used his writings to justify their efforts to subordinate all of life to the very (state) capitalist imposition of work, exploitation, and alienation. So too should they be raised by all readers in evaluating the relevance and usefulness of both the original texts and the analysis set forth here. While I cannot examine the relevance of these ideas to the experiences of each reader, writing this second part of the “Notes” convinced me to compose many new footnotes to illustrate my own evaluation of the relevance of Marx and Engels’ thoughts on crisis in the years since they wrote, including the present. The extensive annotated bibliography of Marx and Engels’ writings includes those on which we based our original essay and many of those referenced in my subsequent revisions. Ideally, the essay would be followed not merely by annotations on material utilized, but by the original material itself – hyperlinked for quick and easy reference. Early on, I had hopes for such linkages in a digital version of the essay. Unfortunately, such an arrangement proved impossible because much of the material has been withdrawn from our digital commons.5 Nor is it practical in hard copy because of the large amount. The original essay included two brief, historical sketches of Marx and Engels’ writings and political activity – in so far as they related to their analyses of 5 This is primarily due to the refusal of the publishers of Marx Engels Collected Works (MECW) to allow free reproduction of the material included in those fifty volumes. Some 1,450 articles from MECW were digitized and made available at www.marxist.org but they were removed under threat by the publishers. Material from many other sources are still available at that site. Preface (2024) xiii crisis – now Chapter 2, Section 1, “The Early Studies: 1843−1850” and Chapter 2, Section 2, “The Years of Theory: 1853−1867,” ending with the publication of Volume 1 of Capital. By that time Marx had already completed the manuscripts that Engels would reshape into Volumes 2 and 3. Because I have drawn upon those volumes and other things they wrote after 1867, in both the original essay and this amplified version, I have extended the historical sketch to cover the period between 1867 and the end of their lives – in a new Chapter 2, Section 3, “After Capital, 1867−1895.” I undertook the elaboration of this new section with much the same reluctance with which Engels took on writing an extended critique of Eugen Dühring (1833-1921) in the late 1870s, albeit for different reasons. Engels was reluctant because he found Dühring’s ideas largely insipid and wrong and only undertook the task because those ideas were infecting the burgeoning German Social Democratic movement for which he and Marx still had hopes. In my case, there were two factors which made writing this section burdensome. First, the eventual disappointing behavior of the social-democratic parties of that time, and second, this later period also included Engels’ dive into creating a post-Hegel dialectical materialism, which provided the starting point of a version of Marxism which would reach its nadir in Stalinist Marxism-Leninism. With respect to the first of these factors, the hopes of Marx, Engels, and many of their followers for the usefulness of political parties for workers, after swelling with the formation of the Second International, were plunged into despair when those so-called working-class parties voted support for the military mobilizations that led to World War I. Moreover, in the years that followed, those same, or similar parties, while helping workers win some gains have repeatedly participated in constraining and harnessing their struggles within capitalist development. Familiarity with this history long ago diminished my interest in studying their early formation and development, including Marx and Engels’ efforts to influence their behavior. With respect to the second of these factors, I was never sympathetic to Engels’ effort to turn Marxism into an all-embracing philosophical system – which Marx himself rejected – and have downright despised its adaptation and use in the form of Marxism-Leninism.6 Both attitudes made it painful to 6 Marx’s rejection can be found in several places. One such was his dismissal of the argument by Nicolai K. Mikhailovski (1842–1904) that his analysis of primitive accumulation implied the historical necessity for all countries, including Russia, to pass through the stage of capitalism. Marx protested Mikhailovski “metamorphosizing” his “historical sketch of the genesis of capitalism in Western Europe into a historico-philosophical theory of general development, imposed by fate for all peoples, whatever the historical circumstances in which they are placed.” Karl Marx, “Letter to [the editorial board of] Otechestvenniye Zapiski,” November 1877, MECW, Vol. 24, p. 200. xiv Preface (2024) return to a whole set of readings once set aside, even with the limited objective of recovering moments of their thinking about crises. To be clear: these three historical sketches are by no means offered as serious biographical contributions. Their focus is narrow, on our two authors’ writings on crisis, and these sketches are merely intended to help the reader situate those writings in time and circumstance. The relevant history is gleaned from the writings themselves and from a variety of histories and biographical sources – often at odds with one another. Footnotes indicate the sources used and sometimes the conflicts among them. The various passages from Marx and Engels’ writings quoted in this essay, have, for the most part, been taken from Marx Engels Collected Works (MECW), with five major exceptions. On the assumption that most readers are more likely to have access to 1) the Penguin editions of the three volumes of Capital and the Grundrisse and 2) to the new translation of Marx’s Economic Manuscript of 1864−1865 than MECW, I quote from the former, but in footnotes give page number references to both editions.7 The translations in these editions are different, so fastidious readers – with enough time and inclination – might want to compare them. They might also check www.marxist.org for other translations from other sources. Those who can read German, of course, can consult the originals in Marx-Engels-Gesamtausgabe (MEGA). Lacking that skill, I do not provide volume or page number references to that work.8 7 Karl Marx, Capital: A Critique of Political Economy, Volume 1, trans. Ben Fowkes (New York: Pelican Books, 1976, London: Penguin Classics, 1990), Capital: A Critique of Political Economy, Volume 2, trans. David Fernbach (New York: Pelican Books, 1978, Penguin Classics, 1992), Capital: A Critique of Political Economy, Volume 3, trans. David Fernbach, (New York: Pelican Books 1981, London: Penguin Classics, 1991); Grundrisse, trans. Martin Nicolas (New York: Pelican Books, 1973, Baltimore: Penguin, 1993), Marx’s Economic Manuscript of 1864−65, trans. Ben Fowkes (Chicago: Haymarket Books, 2017). All footnote references to these volumes just use their title and page number, e.g., Capital, Vol. 2, p. xxx. MECW references provide volume and page numbers. 8 MEGA is the largest published collection of Marx and Engels’ writings and reproduces them in their original languages. The collection is still expanding, under the stewardship of the Internationale Marx-Engels-Stiftung (IMES) in Amsterdam. For more information on MEGA see its entry in Wikipedia. In some English translations, references are given to corresponding volumes and sections of MEGA, but not having access to the texts themselves and therefore unable to verify others’ references, I have chosen not to reproduced them. For an account of the history of efforts to compile Marx and Engels’ writings in substantial collections, see the Appendix to Kevin Anderson, Marx at the Margins: on nationalism, ethnicity and non-western societies (Chicago: University of Chicago Press, 2010, 2016), and the “Introduction” in ­Riccardo Bellofiore and Roberto Fineschi, eds., Rereading Marx: New Perspectives After the Critical Edition (London: Palgrave, 2009), 1−16. Preface (2002) Crisis theory is the Achilles heel of the left. Different views of capitalist development and breakdown have always shaped, and been shaped by, political strategies. In the early and mid-1970s the onset of a crisis of Keynesian policy, and hence theory, brought on by an international cycle of workingclass struggle, led to a widespread preoccupation with “crisis theory” in both capitalist and anti-capitalist circles. This essay was written as an intervention in the debates of those times. Throughout the Keynesian period the regulations set in place during and after the Great Depression coupled with Keynesian policies, both national and international, reduced the depth and shortened the length of business cycle downturns. As a result, the subject was largely neglected in both mainstream macroeconomic theory and among Marxists. When I took a course in business cycle theory at Stanford in the late 1960s the basic message was essentially: “we have things thoroughly in hand, in the future we will only have recessional slowdowns in growth and no depressions in aggregate output.” In the wake of the engineered downturn in 1970 and the subsequent “Great Recession” of 1974−75, it became obvious that this had been a pipe dream. The search for alternatives to Keynesian theory and policy was on. Among mainstream economists that search included the first serious reconsideration of neoliberal policies since Keynes. Among Marxists, it meant a scramble to retrieve and revitalize a variety of theories of crisis that had flourished and competed in an earlier, pre-Keynesian period. So urgent was the capitalist preoccupation with finding new theoretical solutions to the crisis that economic journals and the business press both carried assessments of what Marxists were saying, to see if any of it might be of use. By the early and mid-1970s, when all this was happening, the anti-Vietnam war movement had born fruit, both good and bad. On the one hand, a combination of Vietnamese valor and U.S. internal protest was forcing the U.S. government out of Vietnam (final defeat and exit came in 1975). On the other, many militants were abandoning the New Left for one sect or another of the Old Left and the old sectarian theories and debates were re-emerging – picking up where they had left off years before. This was true with respect to “crisis theory” as it was with respect to other things. As a result, the arguments of that period largely repeated early debates that pitted, for example, underconsumptionist crisis theory against falling-rate-of-profit crisis theory. The political sects associated with various theories are often unpredictable, but there was considerable continuity and the “new” debates generally seemed like dusted-off versions of the old ones. There were a few new wrinkles, but not many. The Sraffians and some American Radicals, for example Ray Boddy and James Crotty, offered a kind xvi Preface (2002) of neo-Ricardian “profit squeeze” crisis theory that was Marxian to the degree that it admitted class struggle over distribution but Ricardian in its neglect of class struggle in production. Other radical economists adopted strands of Marxist theory, usually drawn from the early writings, such as the “anarchy of production,” or over-production. In 1982, the only innovative rethinking of Marxian crisis theory in recent history had occurred in Italy where the Italian New Left had had to take on the very powerful and theoretically sophisticated Communist Party of Italy (CPI). There the “extraparliamentary” Left—that refused to play the CPI’s game of seeking to share power via elections—undertook extensive re-evaluations both of the state of the class struggle and of Marxian theory. During those re-evaluations (that took several years and were spurred and inspired by a whole series of struggles) a number of Marxists, e.g., Romano Alquati, Raniero Panzieri, Mario Tronti, Antonio Negri, found ways to locate many of Marx’s theoretical concepts within the dynamics of class struggle in ways that had never been done before. Concepts like “technology” or the “organic composition of capital,” which had often been treated as either neutral (by the CPI) or purely as denoting weapons wielded by capitalists, were recast as theoretical expressions of aspects of class struggle. At the same time, at least in part because of the CPI’s embrace of Keynesian “development,” some of those same Marxists re-interpreted mainstream economic theory in class terms. They came to see that despite its “neutral,” non-political language, it was very much a theory of the management of antagonistic class relations of struggle. Thus, for example, Negri reinterpreted Keynes as having done more than simply coming up with a new method of exploitation. He discovered a relatively progressive capitalist solution to the new power of the working class that emerged in the 1930s: harnessing wage struggles to drive accumulation. For example, in Keynes’ macroeconomics, the new power of workers to achieve rising wages shifted his “consumption function” in a way that provoked capitalist investment and growth. These Marxists looked around and decided that what Antonio Gramsci (1891−1937) called “Fordism” (a particular way of organizing and managing capitalist class relations) had come to Italy from America and the Keynesian policies embraced by the CPI were its institutionalization at the level of the “social factory.” What Marxist theory provided, they saw, was the means to decode such policies and provide workers with the theoretical tools for dissecting every aspect of “the economy” in class terms.1 1 A considerable body of this kind of work can be found referenced in the Texas Archives of Autonomist Marxism. A brief sketch can be found in the introduction to Harry Cleaver, Reading Capital Politically, 2nd ed. (Leeds: Anti/Theses and Edinburgh: AK Press, 2000). A much more complete survey is now available in Steve Wright, Storming Heaven: Class Composition and Struggle in Italian Autonomist Marxism, 2nd ed. (London: Pluto Press, 2017) and in his more recent The Weight of the Printed Word: Text, Context and Militancy in Operaismo (Chicago: Haymarket Books, 2021). Preface (2002) xvii In a distorted manner some of these insights were taken up first in France, then in Britain and finally in the US by the “regulation” theorists. They took over the Italian New Left understanding of Fordism, for instance, and turned it into a periodization of capitalist management (or “regulation”). From a dynamic response to class struggle, the analysis was reduced to sketching a style of domination. In their lingo, “Fordism” would become more or less equivalent to “Keynesianism” and the post-Keynesian period would be seen as a “post-Fordist” one. What disappeared throughout most of their analysis was the omnipresent antagonistic class dynamics of the Italian theory on which they had drawn and, of course, the politics associated with them. In the same period, some of those Italian reformulations of Marxist theory were imported undiluted and undistorted into those same countries by an entirely different set of actors. In France a variety of militants, including Yann Moulier-Boutang, read and translated many key Italian texts and drew on them to rethink their own situation. This led first to the journal Camarades and later to Babylone and then Multitudes. In Britain the same thing happened through the work of John Merrington and Ed Emery whose translations were published as a series of Red Notes and included both theoretical texts and extensive accounts and documentation of the political situations that had generated those texts. Eventually, that material circulated to the US, first through the movement of individuals exposed to it in Britain and then through the circulation of documents. The first results of that circulation were the appearance in the US of the Wages for Housework movement and then the journal Zerowork (1975, 1977). My own contributions to the elaboration of such theory began in 1978 with Reading Capital Politically − a systematic re-reading of Chapter One of Volume One of Capital in the light of the rest of Marx’s work, incorporating insights from what I had come to call “Autonomist” Marxist theory – because of its emphasis on the ability of workers to take autonomous initiative in the class struggle. The unsettled theoretical debate about “crisis” in capitalism and how to theorize it led Peter Bell and myself to contemplate writing a book surveying, politically decoding, and offering an alternative to the various strains of “Marxist crisis theory” that were then circulating and clashing. As a prelude to, or opening moment of, such a project we decided to undertake as systematic a study of Marx and Engels’ writings on crisis as we could manage, given the texts available to us in languages we could read. While we found many of the Italian innovations inspiring and useful, including moments of analysis of the specific crisis of Keynesianism, nowhere could we find such a systematic study by those theorists. So, we undertook one. The result is the essay below that was originally published in Research in Political Economy in 1982. As it turned out, after undertaking this part of the study, largely my work, much of the analysis of other, more contemporary material was never written up in the form of xviii Preface (2002) chapters. However, samples of the kind of commentary those chapters would have contained can be found in Peter Bell, “Marxist Theory, Class Struggle and the Crisis of Capitalism,” (1977), and Harry Cleaver, “Karl Marx: Economist or Revolutionary” (1986).2 We concluded that the then current debates were not only largely sterile but also, in relation to other projects that interested us (such as dealing with Reaganomics and the onset of the international debt crisis), not worth the time it would take to demonstrate the fact in detail. So, the book was never completed. Harry Cleaver Austin, Texas and Boston, Massachusetts Summer 2002 2 Peter Bell, “Marxist Theory, Class Struggle and the Crisis of Capitalism,” in Jesse Schwartz, ed., The Subtle Anatomy of Capitalism (Santa Monica: Goodyear Publishing Company, 1977). Harry Cleaver, “Karl Marx: Economist or Revolutionary?” in Suzanne Helburn and David Bramhall, eds., Marx, Schumpeter & Keynes (Armonk: M. E. Sharpe, 1986). Chapter 1 Introduction Philosophers have hitherto only interpreted the world in various ways; the point is to change it. Karl Marx ∵ Every time there is an economic crisis in our capitalist system, some of those trying to understand what’s going on turn back to Karl Marx, a man and political activist of the nineteenth century. This includes not only his followers – Marxists of various stripes – but economists and even the business press. With crises recurrent, and this return to Marx along with it, any number of articles and books have been written, reassessing the analysis Marx spelled out in his many writings. For Marxists, this return to Marx has involved renewing old debates, going all the way back to ones he was involved in. For economists it has meant reassessing whether there might be some aspect of his work still useful, despite their general agreement that the fundamentals of his theory were flawed and appropriately set aside long ago. For the business press, reflecting the anxiety of its readers, it has often been a desperate search for something, anything that might help explain the crisis at hand – even if it comes from their most important critic. This book offers one more contribution to the Marxist tradition, one more reinterpretation of Marx’s writings on crisis. Because his writings were often inspired by those of his friend and frequent co-author Friedrich Engels and in turn provided the latter with many theoretical underpinnings for his own work, this essay reads and interprets both of their writings and their interconnections. My principal objectives are to show, first, how their theoretical work grew out of, and was integral to, their political struggles, second, how their theories of crisis were repeatedly formulated in terms of class conflict, third, how their analysis revealed not only the power but also the fragility of capitalism as a social system, precisely due to the many ways in which resistance to its rule © Harry Cleaver, 2025 | DOI:10.1163/9789004708631_002 This is an open access chapter distributed under the terms of the CC BY-NC 4.0 license 2 chapter 1 repeatedly threw it into crisis, and fourth, how their analysis, based on their observation, study, and political engagement in the nineteenth century, is still relevant in the twenty-first century both to our understanding of capitalism and to coping with the crises that face us today. This exposition of their theories of crisis offers a new interpretation and demonstrates how that interpretation is internally consistent, semantically meaningful, and politically useful. In other words, in keeping with Marx’s Eleventh Thesis on Feuerbach, this book offers not just another exercise in Marxian scholarship and political economy but some help in figuring out how to change the world. 1 Work, the Vulnerable Heart of Capitalism The analysis I offer here differs from more traditional interpretations because it understands Marx and Engels’ theories of accumulation and crisis as socio-­ political theories of the development of the antagonistic social relations of capitalist society. The antagonism, I argue, is rooted in the capitalist ­imposition of work and how, in response, people resist, struggling against the subordination of their lives to work – to being exploited and alienated – and often seek to craft alternatives. Therefore, I interpret all of Marx’s concepts of value, ­surplus value, variable and constant capital, the organic composition of capital and so on, as denoting aspects of those relations of struggle. The development of capitalism is more than the evolution of capitalists, their businesses, and their economy. It is an evolving social system, which unfolds as capitalists try to reproduce their reduction of life to work on an ever-increasing scale, as people resist it, and as they try to get beyond it. To many Marxists, the imposition of work appears to be merely something required by capitalists’ endless search for profits, which are obtained by exploiting people’s labor.1 Profits are the motive, the objective, the “end”, while work is merely the “means.” I am arguing the opposite, namely that viewed socially and politically, the search for profits is merely the necessary means through which capitalists maintain and grow their peculiar social order. Investing profit expands the imposition of work on new people or in new ways. This centrality of imposed work as the primary means of social control differentiates capitalism from previous social orders in which work has also been 1 “The sole purpose of a purchase of labor-power is production for profit.” Riccardo ­Bellofiore and Nicola Taylor, eds., The Constitution of Capital: Essays on Volume 1 of Marx’s Capital (New York: Palgrave Macmillan, 2004), 23. Introduction 3 imposed (ancient slavery, serfdom, etc.). In those other systems, the amount of work imposed was limited by particular objectives. But, as Marx argues in the second section of Chapter 10 of Volume 1 of Capital, it is the endless quality of the imposition which differentiates capitalism. The capitalist imposition of work is endless for two reasons. First and foremost, simply because it is the primary way capitalists organize people’s lives, even their own – thus, their opposition to every effort to reduce the amount of work and the control it gives them over society. Second, while the capacity of each individual unit of capital to impose work is limited by its size, there is no theoretical limit to the ever-­ renewed conversion of objects and human activities into commodities whose production provides the opportunity to impose more work. That alone makes the possibilities for capitalists as a class to impose the work of producing ­commodities endless. Although, in their own search for profits, merchants also impose work over and over again on those who handle and transport their goods, as long as they merely traded in surpluses produced by those beyond their control (other people’s serfs, independent peasants, craftspeople, hunters and gatherers, etc.), their ability to put people to work was limited. Industrial ­capitalists overcome this limit by taking over production and imposing work not only on those who transport goods but on those producing them. Unlike merchants, by expropriating everyone else’s means of production and hence their independence, capitalists can force everyone to seek income by working for them – even the merchants whose business has become dependent on the capitalist control over production. Resistance to this endless creation of commodities and the imposition of the work of producing and transporting them has forced capitalists to intervene ever more actively and ever more thoroughly in people’s lives outside the waged workplace. Workers’ success in eventually forcing down the hours of their labor and then liberating their children from waged labor, forced capitalists to organize the re-incarceration of children into schools and to intervene in family life to ensure the reproduction of the willingness and ability to work, i.e., of life as the commodity labor-power. In the process, it has turned society into a “social factory,” a whole social order modeled on the capitalist imposition of commodity-producing work. In this social order, Marx and Engels argued, one finds two different and antagonistic classes: one of capitalists and one of workers, a working class. How exactly those classes are defined and understood has, unsurprisingly, been a key issue among Marxists who have accepted the idea but differed on how they understand it. 4 2 chapter 1 “Class” and Class Struggle My interpretation of Marx’s theory of crisis as one of “class struggle” is based on the following understanding of the “classes” in capitalism. I mean, on one side, those “functionaries” of capitalism, who seek to impose or maintain the subordination of life to work,2 and, on the other side, those upon whom it is imposed, who often resist and struggle to create alternatives. By differentiating class-in-itself and class-for-itself, Marx distinguished between one’s class status and one’s class behavior.3 People find themselves part of the working class-in-itself simply by suffering the imposition of work. Those who resist that imposition and fight for what they need and want, often for life beyond work, become part of the working class-for-itself.4 Both resistance to work 2 When ownership of the means of production (capital, narrowly defined) was generally personal, when owners managed or oversaw the management of their own businesses, it made sense to call such owners “capitalists.” However, with the development of “joint stock” or “­limited liability” corporations, in which ownership is diffused among myriad stockholders, Marx saw that the imposition, organization, and policing of work on the job devolved ­primarily to managers (from CEO’s and Boards of Directors down the administrative hierarchy), who he called “functionaries” of capital. Thus, the key relationship of ownership was replaced by that of managerial control. Eventually, some non-Marxists recognized the same phenomenon and called it “managerial capitalism.” See, for example, Adolph Berle and ­Gardiner Means, The Modern Corporation and Private Property (1932), John Kenneth ­Galbraith, The New Industrial State (1967) and Alfred Chandler, “The Emergence of Managerial Capitalism,” The Business History Review 58, no. 4 (Winter 1984) 473−503. 3 Marx’s most famous delineation of this distinction is in his analysis of the French peasantry in “The Eighteenth Brumaire of Louis Bonaparte” (1852), MECW, Vol. 11, p. 187. I have elaborated this conception of class against the all-too-common practice of seeing individuals as simply belonging to one rigidly defined class or another – what I call the “Madame Defarge theory of class,” after the character in Charles Dickens’ novel Tale of Two Cities (1859) set during the French Revolution. Once Madame Defarge had incorporated the name of a noble into her knitting, they were doomed to the guillotine regardless of their behavior. Similar practices were followed by Stalinists in the USSR with their lists of “kulaks” and Maoists in China with their lists of “rich peasants.” Such “classification” has also been all too common among sociologists, political scientists, journalists, and political pundits. As I have argued elsewhere, ultimately working-class struggle for-itself involves not merely improvements in its condition but escaping capital’s dialectic by creating alternatives, first as experiments then in crafting entirely new worlds in which the class distinction between the “functionaries” of capitalism and a separate working-class no longer exists. See, Harry Cleaver, Reading Capital Politically, 2nd ed. (Leeds: Anti/Theses and Edinburgh: AK Press, 2000), Chapter 2: The Commodity Form. 4 In the case of the capitalist class, the parallel dichotomy of class-in-itself and class-foritself was clearly of less interest to Marx. While he was aware that individual “functionaries of capital” – like members of earlier ruling classes – might resist their role, even drop out of their class, becoming déclassé and choose to be workers, even struggle alongside workers, such behavior was uncommon. One example, of which he was well aware, was Robert Owen (1771−1858), a textile manufacturing capitalist who became so frustrated with his inability to convince other capitalists of his reformist ideas that he defected from Introduction 5 and the fight for alternative ways of organizing life can obviously take many forms, from the open-ended struggle for time and energy liberated from work to concrete experiments in new ways of being. This dual concept of class recognizes how the behavior of individuals is often contradictory. Within the hierarchies of income, wealth and power characteristic of capitalism, individuals may both suffer the subordination of their lives to work yet be involved in imposing it on others. In other words, individuals may, to varying degrees, act as both workers and as functionaries of capital. An individual’s position in the hierarchies largely determines the degree to which one suffers the imposition of work and the degree to which one imposes it on others. Greater willingness and ability to impose work is rewarded by more income, power and status, a higher position in those hierarchies. Greater resistance to that imposition is penalized by lower income, lower status, a lower position. This book, by emphasizing workers’ struggles and their role in creating crises for capitalism, privileges Marx’s concept of working class for-itself. We can recognize how many workers, at a given moment, may not be struggling against their exploitation or even be complicit with it. Complicity can be either passive, simply getting through the job without resisting, or active, as typified by those lucky enough to have jobs where they can exercise an unusual degree of control over their work and thus actually enjoy it, e.g., creative artists, research scientists, teachers, and, as a result, work enthusiastically. This amounts to imposing work on themselves, quite independently of whether they have any supervisory role vis-à-vis other workers. Within conflicts over this social order, I call those who work “workers” or participants in the “working class” and those who seek to maintain it “capitalists” or “functionaries of capital,” while keeping in mind the possible contradictions in the behavior of individuals or groups.5 Recognizing this contradiction also helps in understanding how individuals his class, becoming first a campaigner for worker-owned cooperatives and then tried to set up utopian communities. 5 Marx recognized this phenomenon of the self-imposition of work even for those who did not like their jobs, e.g., in the case of piece work where low piece-wages encourage hard work to the point where the “superintendence of labour becomes to a great extent superfluous.” Capital, Vol. 1, p. 695, or MECW, Vol. 35, p. 552. While he saw this in factories, it also operates beyond the domain of waged and salaried labor, in places like schools where many students who have accepted the framework of competing for grades, impose long hours of homework on themselves, or in homes where unwaged housewives labor to repair and procreate ­labor-power, driven by hopes and expectations fostered by capitalist-shaped culture and advertising. 6 chapter 1 and groups of individuals sometimes shift from imposing work to resisting it or vice versa.6 Recognizing the centrality of pitting people against each other to capitalists’ ability to impose work allows us to understand how all kinds of differences – gender, race, ethnicity, nationality – have been preserved or created and instrumentalized to undermine resistance and gain complicity with life-as-work. Therefore, as Marx clearly understood, “class” has never designated a homogeneous mass, but has always been highly differentiated by 1) being organized hierarchically, with some accorded more power, e.g., men over women, whites over blacks, English over Irish, local over immigrant, skilled over unskilled, salaried over waged, waged over unwaged and so on, and 2) by the inevitably different characteristics of struggles by those in different positions within the hierarchy. As it has been designed to do, this organization of power inevitably involves conflicts among workers, among capitalists, and between workers and capitalists. How those conflicts play out – aggravating differences or overcoming them – results in changes in the distribution and composition of power among workers, among capitalists and thus between workers and capitalists.7 What have been called the “laws of motion” or the “objective historical movement” of capitalist development I understand to be regularities in the unplanned outcomes of the conflicts between antagonistic subjects. As in physics where two vector forces create a resultant force whose direction and magnitude are distinct from either of the two, so too in the class struggles that constitute capitalist development, the “laws” of accumulation and of crisis are the unplanned outcomes of confrontation. Those outcomes are the result of myriad “vectors” of struggle, both within each class and between them. Therefore, analyzing the composition and dynamics of class struggle at any 6 A common example of such a shift in the behavior of individuals comes with promotion to a managerial position in which the “job” becomes imposing work on those who were once co-workers but are now subordinates. This can happen either within the existing hierarchy of jobs or even within unions where “promotion” means becoming a shop steward or union enforcer. Distaste for doing to one’s comrades what one has suffered is one reason why many workers refuse such promotions. An example of such a shift among a whole section of the workforce has been that in the behavior of teachers. As supervision by school administrators and even state legislators has become onerous micro-management trying to control not only what they teach, but also the materials they use, and what they are allowed to say to their students, we have seen teachers rise from compliance with mandated work rules to resistance, a resistance that has included both individual exodus from such jobs and the collective formation of unions and the organization of strikes. 7 Although in his theoretical essays Marx mostly focuses on conflicts between workers and capitalists, with no further differentiation, his studies of actual struggles demonstrate a lively awareness of divisions and conflicts among workers and among capitalists. Introduction 7 point in time and place is no simple matter – as Marx and Engels’ own essays make clear. Building from an such an understanding of the fundamental Marxian concept of the antagonistic social nature of capital, I offer a reinterpretation and synthesis of such traditional themes of “crisis theory” as the tendency of the rate of profit to fall, underconsumption, disproportionality, and the “contradiction between the forces and relations of production.” 3 Capitalism, the Fragile Juggernaut The mere fact that capitalism has progressively dominated the history of our society and planet over the last few hundred years – despite repeated revolts – has given it an air of invulnerability, of being an unstoppable juggernaut. Added to that lamentable fact have been the myriad ideologies conjured up by its apologists that have not only treated its existence as historically inevitable but portrayed it as the culmination of social evolution. With capitalism, have we not, asked the neoconservative Francis Fukuyama, reached the “end of history”?8 It may not be the best of worlds, but is it not the best we are capable of creating? Whatever its flaws, we are told, they can be remedied by piecemeal reforms and there is no point in looking beyond it for some other way of organizing society. In the infamous words of British Prime Minister Margaret Thatcher, “There is no real alternative.” She was arguing for acceptance of her policies, but the phrase became a slogan justifying capitalism in general. Even among the critics of capitalism, including Marx and Engels, the vast majority of words inscribed or uttered have been dedicated to describing not only how successful capitalism has been but also how its power has allowed it to crush, absorb, or instrumentalize all alternatives. Often, books on capitalism by its critics, including Marxists, read as virtual paeans to that power, leaving the impression of capitalism as an evil but almost invincible impersonal force. As a result, proposals about how to organize working class struggle have often rung hollow. Hollow because in their analyses of an all-powerful capitalism workers appear overwhelmingly as victims. If, on the contrary, we recognize how pervasive workers’ struggles have been and how their repeated success at rupturing capitalist plans have revealed its fragility, analyses of those struggles can provide the basis for imaging how we can not only rupture capitalist plans but shatter the juggernaut and bring it down. 8 Francis Fukuyama, “The End of History?” The National Interest 16 (Summer 1989): 3−18. 8 chapter 1 The central thrust of my interpretation of Marxian theory sees accumulation as the expanded reproduction of a fabric of capitalist control that is always tenuous, repeatedly threatened, and often torn by workers’ struggles. The most serious crises are working-class produced rips in that fabric and a consequence of workers either directly undermining some aspect of capitalist control or elaborating a positive alternative which indirectly threatens escape from that control. Sometimes the rips are partial and limited, which capitalists can patch over. Sometimes, the rips spread, opening seams, and exploding in overt, ­revolutionary uprisings, threatening to shred the fabric as a whole. Where ­capitalists can crush or even harness such threats, whether limited or explosive, those crises are successfully “internalized”; they remain within capitalism and can even accelerate accumulation. Marxian analysis, however, reveals how resistance, struggle, and crisis inevitably reappear because of how capitalism organizes the world, including ever more exploitation and alienation.9 This is not to deny that there are many influences within the complex ­pattern of accumulation which are only indirectly related to workers’ struggles. Many of these are discussed below. Struggle always takes place in a concrete setting, at a given level of development, and within a particular class composition that shapes the direction and outcome of the conflict.10 But I contend that from the viewpoint of the working class, every factor related to crisis must be evaluated in terms of the development of sufficient power to overthrow the system. Marx and Engels’ work is most useful to those of us opposed to capitalism when we interpret it within the framework of our struggles. Such a “political reading” of crisis theory eschews reading Marx and Engels’ writings as philosophy, as political economy, or simply as criticism of ­capitalism. It insists on reading them from an anti-capitalist, working-class perspective as providing ideas which can be appropriated as strategic and tactical weapons for workers within the class struggle. 9 10 This reverses the traditional view of revolution as one working class response to crises generated by contradictions internal to capital and independent of workers’ struggles. The concept of class composition, which denotes the dynamics of the power ­relationships within and between the working class and capital at a point in time, along with those of political recomposition (changes achieved by workers’ struggles that increase their power) and decomposition (changes achieved by capitalist efforts that undermine ­workers’ power) was developed by the Italian Marxists discussed in my Preface of 2002. For a detailed analysis of the development of these concepts see Steve Wright, Storming Heaven: Class Composition and Struggle in Italian Autonomist Marxism, 2nd ed. (London: Pluto Press, 2017). Introduction 4 9 What Constitutes a Crisis? This reading leads directly to the question of the very meaning of “crisis.” The concept is ambivalent and has been subject to many interpretations. Its conventional meaning among Marxists has been the denotation of a breakdown in the expanded reproduction of the system. With the concept originating in medicine as a turning point, life or death, in a disease, most Marxists have focused only on “crises” that they believe bring the system as a whole to its knees, with the threat, of course, not merely of collapse but of revolutionary overthrow. The historical sketch in Chapter 2 shows that this was how Marx and Engels saw the situation in 1847−48, where a large-scale, international crisis in capitalist reproduction gave way to a whole series of revolutionary uprisings in Europe. Typical of the dismissal of less dramatic crises, is the Polish Marxist economist Henryk Grossman (1881−1950): “According to Marx, crises can result from changes in prices. As such, they do not interest him; they are special cases. Marx takes ‘capital in general’ as the object of his analysis, i.e., he is only interested in those crises that necessarily arise from the nature of capital as such, from the essence of capitalist production, ‘which are peculiar to it as capital’.”11 On the contrary, this essay shows how Marx and Engels were very much interested in all kinds of crises, not least because they lead to others, building towards a possible “final” crisis to which capitalists can find no adequate response. In their writings, they use the term “crisis” to characterize not only many kinds of breakdowns in capitalist reproduction, but also situations facing workers. Most obviously, in the frequent fluctuations that economists call “business cycles” and Marx and Engels called periodic crises, there have been two very different kinds of “crisis.” The first being a crisis for capitalists, often brought on during an upturn in accumulation by workers’ struggles, e.g., wage increases that outstrip productivity growth and undermine profits, leading to a downturn when capitalists respond by cutting investment, laying off workers, shutting down plants and reducing wages. But those acts create an immediate crisis for workers by stripping them of income and throwing their survival and wellbeing onto whatever savings they may have set aside or onto community networks of mutual aid. Where unemployment is general and alternative jobs are scarce, wages and salaries are low and savings few or non-existent, in communities lacking networks of mutual support, the lack of income quickly 11 Rick Kuhn, ed., Henryk Grossman Works: Volume 3: The Law of Accumulation and ­ reakdown of the Capitalist System, being also a Theory of Crises (Chicago: Haymarket B Books, 2021), 119. 10 chapter 1 begats absolute penury and impoverishment and all the woes that accompany them: increased anxiety, loss of dignity, inability to take care of children and other family members. When such responses are accompanied by important organizational changes in the structure of the class relations, such as the introduction of labor-­ displacing machinery, or the displacement of production operations from areas where workers’ struggles have been strong enough to throw local capitalists into crisis to other areas where workers are weaker, the crisis for workers is even more profound and long-lasting, often undermining their existing forms of self-organization and ability to fight for what they need and want. Such crises – for both capitalists and workers – may be small or large, temporary ruptures in the rhythm of accumulation or those critical moments when the continued existence of the system is a stake. This complexity is why Chapters 4 and 5 of this essay, on the possibilities and predispositions to crisis, make up the bulk of this essay. Exploration of Marx and Engels’ writings have revealed analyses of a great many possibilities and predispositions, some small, some great, some transitory and some long-term secular tendencies. One result of that exploration, which motivated the original version of this essay, was dissatisfaction with existing interpretations of Marxist crisis theory in a number of respects; these interpretations variously: (1) see only theories of the development of capital and capitalists, but not of the class relation, (2) focus on the centrality of capitalist competition, which is conceptualized in terms of relations among units of capital separate from the class relation, (3) sever the unity of the spheres of production and circulation by privileging the former (falling rate of profit/rising organic composition of capital) or the latter (underconsumption or neo-Ricardianism), (4) assign the dominant role to the so-called “forces of production,” often understood simply as technology, (5) fetishize Marxian categories including crisis theory, such that it becomes a theory of investment behavior or mechanical breakdown,12 or (6) destroy the unity within Marxist crisis theories by asserting the existence of many different strands, or separate theories.13 In this essay, however, I mostly set aside critical evaluations of other interpretations, in favor of spelling out an alternative. 12 13 Despite the association of the term “breakdown” with such theories, I choose to use the term more broadly to signify a rupture in some aspect of the organization of accumulation. A “breakdown” is also a failure in some planned moment of accumulation. Because the causes of a breakdown vary, they must be identified to explain any particular rupture/ failure. But the term’s very lack of specificity as to cause makes it a useful synonym for crisis in some moments of expanded reproduction. Peter Bell, “Marxist Theory, Class Struggle and the Crisis of Capitalism,” in The Subtle Anatomy of Capitalism, ed. Jesse Schwartz (Santa Monica: Godyear Publishing Company, 1977), 170−94. Introduction 11 Here, I read Marx and Engels’ texts for what I can learn about struggles in the period in which they were written – to discover, in turn, the degree to which their insights still apply in the present. I argue that the basic analytical framework worked out by Marx and Engels is still valid and accurately describes many of the fundamental features of contemporary capitalist society. Clearly much has changed since they wrote. A concrete analysis of contemporary capitalist society obviously requires an adaptation and extension of Marxist theory to take these developments into account. Having participated in such efforts elsewhere, this essay eschews the temptation of “up-dating” Marx and Engels’ writings and grounds understanding of the original analysis directly in the texts themselves. It is not enough, but I have found it to be one useful step. Let me show you where we’re going. I’ve organized my analysis of Marx and Engels’ widely scattered discussions of crisis in seven chapters. Chapter 2. Marx & Engels’ Studies of Crises. These two men’s writings on crisis are scattered from early on in their lives throughout the decades that followed. As their engagement in political struggles and their studies of capitalism, class struggle and crises evolved, so did their analysis, often in response to new developments, always as interventions into on-going struggles. This chapter provides a sketch of that evolution to provide historical context for the more detailed dissection of their theory of crisis which follows. Chapter 3. Marx’s Theory of Accumulation. This chapter frames my synthesis of Marx and Engels’ writings on crisis in their major published books, their journal articles, and their correspondence. It does so by providing an interpretation of Marx’s analysis of the nature and functioning of capitalist accumulation when it is not in crisis. Chapter 4. Possibilities of crisis. This part brings together the passages where Marx and Engels point out the various moments at which it is possible that the processes of production and circulation can be interrupted. I organize their comments first by sketching their analysis of how the possibility of crisis is inherent in markets – which predate but become an essential, albeit subordinate, dimension of capitalism – and then by examining the possibilities of crisis in each stage of the circuit of industrial capital. Chapter 5. Predispositions to crisis. The existence of possibilities of interruption does not mean that rupture will in fact occur. So, Marx and Engels also examine the forces within accumulation that may lead to the actualization of those possibilities; in other words, the forces which establish ­various predispositions to crisis. Here I situate their analyses of many frequently ­discussed “causes” of crisis, for example, the tendency of the rate of profit to fall or tendencies to underconsumption, among a great many other forces at work. 12 chapter 1 Chapter 6. Offsetting Tendencies. Although Marx and Engels frame their analyses of crisis in terms of the forces that tend to undermine accumulation, they also recognize and analyze some of the strategies and tactics that capital uses to offset those tendencies. A few of those are laid out in Chapter 14 of ­Volume 3 of Capital; many more are scattered through their writings. Chapter 7. Crisis as Solution. Marx and Engels have highlighted how capital often tries use the crisis itself to overcome interruptions and ruptures in accumulation and to restore the conditions of reproduction. The capitalist use of crisis often involves countering ruptures caused by workers’ struggles by imposing new constraints on them, new crises-for-workers. When they are successful, crisis becomes an equilibrating moment in a secular process, overcoming predispositions to disequilibrium – effectively an offsetting tendency, but one that is unique and important enough to deserve separate treatment. Chapter 8. Crisis and Revolution. Crisis becomes revolution when capital fails to realize the second moment of crisis, when it fails to turn the crisis against the working class and restore control. In other words, when the workers’ ­struggles threaten the overthrow of the system as a whole. To date, revolutionary threats have been both local and temporary; retaining control elsewhere, capital has been able to contain and reverse such defeats, reestablishing accumulation. The optimism of Marx and Engels’ analysis lies in their perceptions that first, because the reestablishment of accumulation inevitably recreates, on an expanded scale, of all the antagonistic contradictions of the system, and second, so too does it recreate the possibilities of ruptures so great, so widespread and thoroughgoing that capitalists are unable to cope as revolutionary uprisings overthrow the system and people free themselves from being “mere workers” by changing every part of society more to their liking. Chapter 2 Marx & Engels’ Studies of Crises, 1843−1895 Karl Marx and Frederick Engels were men of the nineteenth century and their understanding of economic and political crises was based on both observation of the events of their time and the theories they developed to understand them. They lived, fought, and wrote during a period of recurrent economic ­crises marked by several major political upheavals in some of which they participated as militant revolutionaries. Dedicated to active political organizing against an expanding capitalism that was subordinating more and more people to endless work, in cruel, often murderous ways, Marx and Engels studied economic crisis, not as academic theorists but as militants. They studied the periodical crises of capitalist accumulation while helping organize and expand: first, the Communist League in the period of the Revolutions of 1848, and then the First International in the period surrounding the Commune of Paris in 1871. As working-class political parties began to be formed, they contributed both critique and positive input into the formulation of the politics of such parties. In every case, they were dedicated to the unification of workers’ struggles across national borders and the transcendence of capitalism. Given the importance Marx and Engels attached to workers’ struggles not only in causing crises in capitalist accumulation but also in their potential to overthrow capitalism completely, their interest in discovering the dynamics of capitalist growth aimed at showing workers two things: first, the sources of the frequent crises of their time, and second, how the interests of some workers were inevitably bound up with those of others elsewhere. The path towards greater power for workers lay in strengthening connections and developing ways to collaborate. In their writing and in their political activity, we can discover both their understanding of the ways in which workers’ struggles circulate and their own efforts to accelerate that circulation. Their efforts included: 1. the serious study of languages relevant both to their studies and to their ability to communicate politically, 2. writing up and giving verbal accounts of struggles in one place to convey stories of those struggles to workers elsewhere, 3. translating their writings, by themselves or through others, to increase the likelihood of their accounts of workers’ actions in one place having an impact on workers elsewhere, © Harry Cleaver, 2025 | DOI:10.1163/9789004708631_003 This is an open access chapter distributed under the terms of the CC BY-NC 4.0 license 14 chapter 2 4. helping organizations in one place create or strengthen links with ­organizations elsewhere, 5. by supporting emigrants like themselves, they facilitated the ­international circulation of the experience of struggle and the spreading of lessons learned Educated in both the gymnasium and university in German, Latin, and Ancient Greek, Marx and Engels repeatedly studied those modern languages they found relevant to understanding capitalist development and workers’ struggles. Moreover, as they became more and more deeply involved in politics, they worked hard at learning the languages they needed to communicate their ideas – in both writing and conversation – to others struggling for change.1 Obviously, neither man was a member of the factory proletariat that they saw as the increasingly dominant sector of the working class and whose struggles they were dedicated to circulating. When he wasn’t fighting the system, Engels worked as what Marx eventually called a “functionary of capital” for his father’s business. Marx made his living as a writer of books and as a journalist. Income from both sources was highly irregular. Although he dismissed writers who worked for capitalist employers as an insignificantly small part of the working class, he did just such work. Despite their anti-capitalist content and objective, his books were printed and sold as commodities – earning him income, either as advances or as royalties, while earning profits for his publishers. His journalism, first for the New York Herald Tribune, and then as a contributor to New American Cyclopaedia made him, in effect, an intellectual gig worker, unsalaried and paid by the piece, per article by the Tribune, per page by the Cyclopedia editors.2 For both men, their primary modes of political action were writing and organizing. Both drew on skills learned in school and continued to study, write, and organize, learning through participation, first 1 Most good biographies of Marx and Engels contain accounts of their language learning. A recent survey, drawing on both biographies and now available letters, is Kaan Kangal, “Marx and Engels as Polyglots” Monthly Review 75, no. 9 (February 2024): 22-35. 2 Although the payment went to Marx, like Tom Sawyer in Mark Twain’s novel, who got a friend to do his work of painting a fence, Marx often talked Engels into writing some of these pieces published under his name – especially those for which he thought Engels was more qualified, e.g., on military matters. His personal annoyance with the piecework character of his journalism certainly contributed to his detailed analysis of piece-wages in Chapter 21 of Volume 1 of Capital. One complaint to Engels: “It’s truly nauseating that one should be condemned to count it a blessing when taken aboard by a blotting paper vendor such as this [the ­Tribune]. To crush up bones, grind them and make them into soup like PAUPERS in the WORKHOUSE – that’s what the political work to which one is condemned in such large measure in a ­C ONCERN like this boils down to. I am aware I have been an ass in giving these ladies more than their money’s worth – not just recently but for years past.” Marx to Engels, January 23, 1857, MECW, Vol. 40, p. 98. Marx & Engels’ Studies of Crisies, 1843−1895 15 in reform circles and later among worker organizations. As I point out below in my historical sketch, they developed these skills within the context of rapid socio-economic change in which a whole array of reformers and revolutionaries were already active. In their now collected works, one can easily see how Marx and Engels’ writing took two forms: writing to and for comrades in struggle and writing for public consumption. In the absence of telephones or email, most correspondence with others was either face to face or epistolary, handwritten letters to share ideas and to organize. Their written correspondence was voluminous as they shared experience, discussed organizational strategies, critiqued others’ ideas, offered early formulations of their own ideas, which later appeared in their published works, or recaps of points already made in print designed to highlight their political implications. Their correspondence with each other and with comrades illuminates our understanding of both the evolution of their analysis of crisis and their perception of its importance for political action. Until finally being published in MECW and MEGA, most of their letters were unknown and unavailable outside the archives that contained them. But among those that were, perhaps the best known was Marx’s letter to Engels telling him about slaving night after night to pull together his analysis during the crisis of 1857 in anticipation of possible revolutionary upheaval. (See, ­Section 2.1.) Today, hundreds of such letters are readily available, although mostly studied only by their biographers.3 In their public political writing, one can find exhortations to collaboration across differences, e.g., the famous call in the Communist Manifesto for “workers of the world” to unite, but almost all their efforts, both theoretical and political, were designed as interventions aimed at bringing about or speeding up the circulation of struggles – the only path they could see to the overthrow of capitalism. Those interventions included a) writing articles in the language appropriate to the targeted group of workers, e.g., in German for the Rheinische Zeitung or Neue Rheinische Zeitung, but in English for Chartist and American newspapers, b) the creation of new publishing efforts to overcome linguistic barriers, e.g., the Deutsch-Französische Jahrbücher aimed at linking Germans and French struggles by publishing articles by revolutionary intellectuals in both languages, and c) efforts to get their major works published in as many languages as possible, e.g., Marx’s efforts to recraft the French translation of Capital to increase its accessibility to workers in France. Whether they were directly involved in struggles, e.g., the 1848 Revolution in Germany, or observing 3 I include myself among those who have, so far, failed to study this correspondence in detail. While for this book I scoured the many volumes of MECW for discussions of crisis, I largely ignored everything else. 16 chapter 2 them from afar, e.g., the Paris Commune, they wrote about them to circulate the lessons they drew from those experiences to other workers in other places. Not only their writing but also most of their political organizing aimed to bring workers together across linguistic and cultural differences –in the League of the Just, in the formation of the Communist Correspondence Committee, in the Communist League and in the International Working Men’s Association, or First International. And, for Engels, who outlived Marx, in the Second International.4 Part of this work was writing up position papers and manifestos for the various groups, e.g., Engels’ “Draft of a Communist Confession of Faith” and Marx and Engels’ Communist Manifesto for the League of the Just. This kind of writing was integral to their political work throughout their lives. But like other organizers of their day, they didn’t just write. In the absence of any form of audio-visual recording and reproduction, they also took the time and devoted considerable energy to public speaking to groups of workers and to potential supporters among the middle classes. We know about such efforts from letters, lecture notes eventually published and from contemporary accounts. Early examples include the speeches Engels gave in Elberfeld and later prepared for publication.5 In a letter, he recounts to Marx: Here in Elberfeld wondrous things are afoot. Yesterday we held our third communist meeting in the town’s largest hall and leading inn. The first meeting was forty strong, the second 130 and the third at least 200. All Elberfeld and Barmen, from the monied aristocracy to épicerie (small shopkeepers) was represented, only the proletariat being excluded.”6 Among the better-known examples of speeches to workers, also cited below in Section 2.2, is Marx’s report to the Central Council of the First International 4 In terms of organization, this emphasis on circulating struggles across differences in the working class has been a central part of Marx and Engels’ legacy. The Second International (1889−1916) was followed by the Third International – the “Communist International” or “Comitern” – (1919−1943) created by the Bolsheviks in the wake of the Russian Revolution and the Fourth International formed by Leon Trotsky and his followers in 1938 after his exile from the USSR and in opposition to Stalin’s domination of the Comitern. It can also be seen in Marxist support for anti-colonial or national liberation struggles in the post-WWII period and in the alter-globalization efforts of recent years undertaken by all sorts of opponents of capitalism. 5 These February speeches were written up by Engels and published in August in the Rheinische Jahrbücher zur gesellshaftlichen Reform. See endnote 91, MECW, Vol. 4, p. 697. “Speeches in Elberfeld,” February 8, 1845, MECW, Vol. 4, pp. 243−251. “Speeches in Elberfeld,” February 15, 1845, MECW, Vol. 4, pp. 256−64. 6 Engels to Marx, February 22 – March 7, 1845, MECW, Vol. 38, pp. 22-23. Marx & Engels’ Studies of Crisies, 1843−1895 17 presented on June 20 and 27, 1865, eventually published posthumously in 1898 as Value, Price and Profit.7 Beyond researching, writing about, and telling tales of distant struggles to local audiences, Marx and Engels – like so many workers, moved from place to place and carried their experience of struggle with them. Engels moved from Germany to England; Marx moved from Germany to France (Paris) to Belgium (Brussels) to England (London). In each place, they not only lived within communities of émigrés and refugee revolutionaries like themselves but also welcomed others from afar to share their experiences and learn from them. Among them were Poles and Russians from the Eastern European front of the struggle for democracy, worker, and peasant rights. These included J­ oachim Lelewel, who collaborated with Marx and Engels in Brussels, Walery Wróblewski, a general in the Paris Commune and later a member of the General Council of the First International,8 and Mikhail Bakunin who also joined the First International after opposing Czarist occupation of Poland, participating in the Czech Rebellion of 1948, being imprisoned in Russia but escaping exile to Siberia. Influenced by Proudhon and destined to become a major figure in the anarchist tradition, Bakunin sparred with Marx and Engels over revolutionary strategy.9 These prominent individuals, however, were just visible representatives of vast numbers of lesser or unknown workers on the move, carrying their experience of struggle with them to new terrains. With the rapid development of capitalism came massive movements of workers. Some were moved forcibly, e.g., slaves, press-ganged seamen and those arrested, jailed, and transported to the peripheries of the expanding capitalist world. For far more, g­ eographical displacement was either part of their work, e.g., sailors and soldiers, or a form of struggle, e.g., pirates or immigrants seeking freedom from exploitation. Marxists have tended to emphasize the role of capitalists in all this movement, from merchant capitalists seeking new markets to industrial capitalists seeking new pools of labor and sources of raw materials. Their roles in conquest, the creation of colonies and empire were obvious. Less obvious has been the autonomous mobility of many workers either making use of capitalist circuits or breaking free of them. Yes, some capitalists profited from providing transportation to 7 See endnote 87, MECW, Vol. 20, pp. 466−67. 8 See the mentions of Lelewel and Wróblewski in “Notes to Polish Readers” included in this volume. 9 Their differences in strategy, which eventually led to Bakunin’s expulsion from the International, are well-known and were based on differing analyses of how workers should deal with the state. Whereas Bakunin argued for revolutionaries to immediately abolish the state, Marx argued for taking it over – to prevent counter-revolution – and then gradually abolishing it as people developed alternative institutions. More on this in Chapter 8: Crises and Revolution. 18 chapter 2 workers on the move, e.g., German companies selling immigration (tickets to the US) to workers in the wake of the 1848 uprisings. But many of those who moved had participated in the revolution and were escaping the subsequent repression to pursue their struggles elsewhere, e.g., those who moved to Texas and founded communist communities.10 Yes, sailors were workers on the commercial fleets of the expanding empire, but they often mutinied, becoming pirates, or jumped ship leaving the sea altogether, becoming immigrants in new lands. As Linebaugh and Rediker have demonstrated, capitalist expansion in the Atlantic (and beyond) not only included the formation of a polyglot working class – on land and on the sea – but also the movement of those workers circulating their experience and struggles throughout that world.11 I divide my account of Marx and Engels’ studies and writings on crisis into three periods. The first period is the decade of 1842 to 1852, during which Marx and Engels elaborated their critiques of Hegel’s philosophy, plunged into the study of political economy, and began to become seriously involved in political struggles. I end this period when both Marx and Engels had completed their major works analyzing the forces involved in the Revolutions of 1848 and with the dissolution of the Communist League in 1852. The second period includes the 1850s and 1860s, encompasses the long lull in their political activity and the most intense development of their theories of capitalism and its crises. It was during this interim that Marx composed the fullest elaboration of his theories of capitalism and class struggle in a series of notebooks and manuscripts. I date the end of this period as 1867, the year he published Volume 1 of Capital. The third period, 1867 to 1895, encompasses the rest of Marx and Engels’ lives – Marx died in his 65th year in 1883 and Engels in his 75th in 1895. During these years both men continued to think, write, and participate in various political efforts, including the First International and the formation of the first working-class political parties to enter the terrain of electoral politics. Comparing their early writings on crisis with later ones reveals both continuities and important changes. The most important continuity is the central concern with the relationship between crisis and workers’ struggles. The most important changes result from Marx’s elaboration of his theories of value, surplus value and accumulation. Those concepts allow Marx and Engels to understand crisis in terms of class struggle with much greater clarity and in more detail than hitherto possible. 10 11 Ernest Fischer, Marxists and Utopias in Texas (Burnet, TX: Eakin Press, 1980). Peter Linebaugh and Marcus Rediker, Many-headed Hydra: Sailors, Slaves, Commoners, and the Hidden History of the Revolutionary Atlantic (Boston: Beacon Press, 2000). Marx & Engels’ Studies of Crisies, 1843−1895 1 19 The Early Studies: 1842−1852 In 1839, while working at his family’s textile business in his hometown of Barmen, Engels published – in vivid detail and from direct observation – a series of letters reporting on the exploitation and suffering of industrial workers.12 But while juxtaposing the condition of workers with “the wholesome, vigorous life” of people elsewhere, his condemnation was general and not related to any critique of capitalism or any idea of crisis. That would come later. Instead of such analysis, he berated the local bigotry, religious extremism, and anti-intellectualism that he associated with the hypocritical Lutheran pietism of property owners and the desperation of workers. He seems to have only begun the serious study of political economy and of capitalist crisis after meeting Marx in the fall of 1842.13 In November of 1842, while on his way to his father’s cotton mill in Manchester, England, Engels took time to visit the offices of the Rheinische Zeitung in Cologne, Prussia, a liberal journal founded by Rhenish industrialists with an editorial staff that included Marx.14 Despite some differences, they agreed that Engels would write for the journal about the situation in England.15 12 13 14 15 At the time, Barmen and the adjacent town of Elberfeld (see below) were part of Prussia, an independent Kingdom until forming the North German Confederation in 1867, a step toward the unification of Germany in 1871. Engels’ “Letters from Wuppertal” were published in a progressive Hamburg journal, the Telegraph für Deutschland, in March and April 1839, MECW, Vol. 2, pp. 7−25. Wuppertal = Wupper Valley = valley of the Wupper river, a tributary of the Rhine. The water of the Wupper powered the industries of the valley in that period. Eventually, with the substitution of the steam engine for waterpower, demand for coal by Wuppertal industry would drive the development of mining in the nearby Ruhrgebiet or Ruhr Valley. Many may identify with Engels’s reaction in this period when so many Christians have been proving themselves hypocritical bigots in their embrace of white supremacy and Christian nationalism and so many workers have been suffering the consequences of unconstrained neoliberalism. The business backers of the paper were seeking greater freedom and a roll in government – something they would only get with the Constitution and Parliament ­created by the Prussian king Frederick William IV in the wake of the Revolution of 1848. Biographers differ on Marx’s position at the paper. McLellan claims that in October 1842, Marx was made editor-in-chief. Sperber, on the other hand, claims that Marx only received “an employment contract.” Whatever his formal position, all agree his coming on board strengthened the paper’s critique of the Prussian government and dramatically increased its circulation. See David McLellan, Karl Marx: A Biography (New York: ­MacMillan, 1973), 43, and Jonathan Sperber, Karl Marx: A Nineteenth Century Life (New York: Liveright, 2013), 91. Engels tells of his first “distinctly chilly” meeting with Marx, in an 1895 letter to Franz Mehring (1846−1919). See, Engels to Mehring, London, End of April 1895, MECW, Vol. 50, p. 503. 20 chapter 2 In Manchester, amidst its infamous “satanic mills,” Engels found himself in the heart of British industrialization and in the midst of the English working class and its major political movement of the time: Chartism. With English workers suffering much the same exploitation as their German counterparts, the Chartists had organized peacefully the previous May and presented a petition to the House of Commons – with over 3 million signatures – demanding democratic reforms, including universal adult male suffrage, giving propertyless workers as well as property owners the right to vote. It was overwhelmingly rejected.16 That rejection, coupled with rising unemployment, led to a wave of strikes throughout much of industrial England. Engels wrote stories for the Rheinische Zeitung on the economic situation and the angry reaction of workers plunged into poverty through the loss of their jobs and with no hope from Parliament.17 His reports contain elements of an analysis of crisis – and its relation to revolution – that he would soon systematize: the necessity of industry to expand, the resulting need for markets, inevitable limitations on those markets, fluctuations in trade and crises of overproduction or glutted markets, at home or abroad. But crisis for the capitalists also means crisis for workers: overproduction means layoffs, rising unemployment and hunger. The more severe the downturn, the greater the suffering. He predicted that when a “large-scale trade crisis” creates “general lack of food among the workers,” then “fear of death from starvation will be stronger than fear of the law” and, with peaceful petitions having failed, revolution will result.18 In this period “trade” refers to both domestic commerce and international trade. As capitalists’ command over production expanded, they required profitable markets for their products. In his analysis of primitive accumulation, Marx would later show, in Capital, Vol. 1, Chapter 30, how capitalists’ theft of locals’ land and tools and their imposition of wage labor creates a “home” or domestic market. Then in Chapter 31, he would show how they repeated the process abroad via colonialism. In both cases, capitalist success required victory over the resistance of those being expropriated. At home, the repression required was justified, when anyone bothered, by such claims as the need for more “efficiency” in production, despite the way increasing mechanization 16 17 18 It was neither the first, nor the last Chartist petition. For a brief history see the Wikipedia article “Chartism”. “The English View of the Internal Crisis,” Nov. 29, 1842, MECW, Vol. 2, pp. 368−69, “The Internal Crises,” Nov. 30, 1842, MECW, Vol. 2, pp. 370−74, and “The Condition of the Working Class in England,” December 20, 1842, MECW, Vol 2, pp. 378−79. “The Internal Crises,” MECW, Vol. 2, p. 373. Marx & Engels’ Studies of Crisies, 1843−1895 21 displaced workers and threw them into poverty. Abroad, colonialism, after crushing local resistance via military conquest of some and the co-optation of others, developed foreign markets and extracted cheap resources via exploited cheap labor, while rationalizing these actions with the racist rhetoric of “white man’s burden” to “civilize” the supposedly backward and racially inferior natives. Early on, international trade was justified in Britain by merchants arguing the need for trade surpluses to bring gold and silver into the country.19 Their “mercantilist” arguments were soon replaced by those of British political economists such as Adam Smith (1723−1790) and David Ricardo (1772−1823) in favor of “free trade,” which would supposedly benefit all trading partners. Although British imperialists touted that the sun never set upon the Union Jack, the same could be said of the banner of “free trade” carried by political economists and policy makers alike. These arguments supported an aggressive expansionism, while typically ignoring how all colonial powers, including the British, denied the markets they seized to others – so they really weren’t “free” at all.20 Against such hypocrisy, capitalists operating in weaker nation states pitted arguments for the “protection of infant industries” against aggressive British expansionism. Capitalists in countries such as Germany and the United States sought bigger profits by getting tariffs and other barriers erected to keep out 19 20 This was an argument specific to Britain, whose colonies turned out to lack precious metals, unlike those of Spain in Mexico and Peru. Although later mercantilists replaced the crude arguments of “bullionists” by more sophisticated ones, they all argued – while asking for support from the government – that trade was the main path to increasing the local stock of precious metals and national wealth. “Free markets” are a capitalist myth; both supply and demand have always been the object of manipulation by all concerned: capitalists, governments and customers (both other capitalists and workers). This is true for both input markets (for labor-power and the means of production) and output markets (for the final product). Domestic trade has been shaped by all sorts of government policies, from legal regulation and tax policies to direct subsidies. Foreign trade has also been manipulated through such means as tariffs, customs duties, and colonialism. This is even more obvious today, where governments regularly negotiate trade arrangements, codifying both domestic and international trade in laws, treaties and institutions, e.g., the Federal Trade Commission in the US, the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) at the global level. Lurking in the shadows behind those governments are generally intense capitalist efforts to shape agreements in their particular interests. Out front in broad daylight are often masses of consumers and workers protesting that influence and results inimical to their interests. Recent examples include cross-border opposition in Canada, the United States and Mexico to the North American Free Trade Agreement (NAFTA) and recurrent protests and disruptions of the WTO. The “Battle of Seattle” was only one of many such protests. 22 chapter 2 cheaper foreign (often British) imports. They too had their political economists as apologists. For example, George Friedrich List (1789−1846) sharpened the arguments of Adolphe Thiers (1797−1877) and Alexander Hamilton (1755−1804) into advice to both Prussian and American policy makers and laid out his arguments systematically in his book The National System of Political Economy (1841). All these proceedings and debates formed the backdrop to first Engels’ and then Marx’s turn to the study of political economy. Marx’s interest in political economy was stimulated, in part, from his efforts, as editor of the Rheinische Zeitung, to critique on-going legal debates over the laws dealing with peasants caught appropriating fallen wood in once common but now enclosed forests.21 He also took up the economic problems of vintners in his native Moselle Valley. They were suffering a decline in the value of their wines and the absence of any helpful government action, such as a compensatory reduction of taxes. The situation seems to have been a byproduct of the creation of the Zollverein, a customs union that removed barriers to trade among several German states. As a result, the vintners were subject to competition from growers elsewhere in Germany. In addressing the conflict, Marx neither analyzed this background nor took up the ongoing debates over “free trade” and “protectionism” – as he would a few years later.22 At this point, he only attacked government press censorship that inhibited open discussion.23 With respect to these problems of peasants and vintners, years later he explained how he found himself “in the embarrassing position” of having to discuss them in print with no background knowledge.24 Only in critiquing the 21 22 23 24 “Proceedings of the Sixth Rhine Province Assembly, Third Article, Debates on the Law on Thefts of Wood,” Rheinische Zeitung, October and November 1842, MECW, Vol. 1, pp. 224−63. Such laws against direct appropriation on privately owned lands have been widespread and long predate capitalism. One thinks of the iconic tale of Robin Hood, who, in at least one version, was outlawed for poaching the “King’s” deer. See, Chapter One of Howard Pyle, The Merry Adventures of Robin Hood (Racine: Whitman Publishing Company, 1883). Capitalists continued such practice, to criminalize appropriation, whether of wood, edible plants, or animals. On some laws against poaching see, Douglas Hay, “Poaching and the Game Laws on Cannock Chase,” in Douglas Hay, et al., Albion’s Fatal Tree: Crime and Society in Eighteen Century England (New York: Pantheon Books, 1975). On Marx’s critique of the Law on Thefts of Wood, see Peter Linebaugh, “Karl Marx, the Theft of Wood, and Working-Class Composition: A Contribution to the Current Debate,” Crime and Social Justice 6, (fall-winter, 1976): 5−16. See below, Chapter 4, p. 208. See his response to government complaints about treatments of these problems in the Rheinische Zeitung, “Justification of the Correspondent from the Mosel,” MECW, Vol. 1, pp. 332−58. “In the year 1842−43, as editor of the Rheinische Zeitung, I first found myself in the embarrassing position of having to discuss what is known as material interests.” Karl Marx, Marx & Engels’ Studies of Crisies, 1843−1895 23 debate over the appropriation of fallen wood did he deal directly with workers’ struggles. He sided with the peasants, pointing out how the Provincial Assembly permitted the forest owners to usurp the law in their own interest. Regularly harassed by a government censor who rejected article after article, Marx nevertheless succeeded in publishing several essays by Moses Hess (1812−1875) discussing socialist and communist ideas.25 Attacked for these articles by a more conservative newspaper, Marx responded by arguing not for communist ideas but for submitting “these ideas to thorough criticism … to long and profound study.”26 Indeed, he was soon engaged in just such careful reading of writers such as Étienne Cabet (1788−1856), Charles Fourier (1772−1837), and Pierre-Joseph Proudhon (1809−1865), all of whom inevitably raised issues of political economy.27 Because Marx published article after article critical not only of oppression and poverty in Prussia but also of the injustice of legal reforms proposed by King Frederick William IV, all while demanding open public debate and complete freedom of the press from censorship, the government moved to suppress the Rheinische Zeitung, ordering its closing by the end of March 1843.28 25 26 27 28 “Preface” to A Contribution to the Critique of Political Economy (1859), MECW, Vol. 29, p. 262. Many years later, Engels affirmed that “Marx always used to tell me that it was precisely his preoccupation with the law on thefts of wood and the condition of the Mosel winegrowers that led him from politics pure and simple to economic conditions and thus to socialism.” Engels to Richard Fischer, April 15, 1895, MECW, Vol. 50, p. 497. Sometimes said to have been the individual who introduced communist ideas into ­Germany, Hess claimed to have influenced Engels during the latter’s visit to Cologne ­earlier in 1842. “Engels, who was revolutionary to the core when he met me, left as a passionate revolutionary.” Quoted in David McLellan, Friedrich Engels (Harmondsworth, UK: Penguin Books, 1977), 21. See “Communism and the Augsburg Allgemeine Zeitung,” MECW, Vol. 1, p. 220. See Saul Padover, Karl Marx: An Intimate Biography (New York: McGraw-Hill, 1978), ­Chapter VIII. Two things are worth noting. First, the suppression of the Rheinische Zeitung was part of a broader wave of repression that forced the closure of several papers that had dared to question or challenge the government. Second, not only was the Prussian government upset about public criticism, but it was, in turn, under pressure from the Czarist government in Russia for permitting the publication of articles critical of its policies. See, ­McLellan, Karl Marx: A Biography, 50. Throughout his life, Marx would single out the Czarist regime as being a primary bulwark of absolutism and reaction on the continent. Such repression of the press and criticism, along with the refusal of any form of democratic input into its decision making, illustrates why these regimes were called “absolutist.” The monarchs demanded absolute power and tolerated no challenge. Such a regime was rejected during the American Revolutionary war, 1775−1783, and overthrown in France in 1789. Both capitalists and working-class revolutionaries sought the overthrow of such centralized power. In some cases, monarchies have survived by accepting constitutions, 24 chapter 2 1.1 Paris and Manchester Following the shutting down of the Rheinische Zeitung in March and his marriage to Jenny von Westphalen (1814−1881) in June, Marx and his wife moved to Paris in October 1843. Once settled, he began to 1) make up for his ignorance of political economy by studying both English and French political economists29 and 2) collaborate with Arnold Ruge (1802−1880) to launch a new paper. Their Deutsch-Französische Jahrbücher aimed at linking struggles in Germany and France by publishing articles by revolutionary intellectuals in both languages and developing contacts with workers. Although he was unable to attract contributions from those French socialists whose writings he had been studying, Marx did establish connections with both immigrant German and local French workers in Paris – often unable to speak each other’s languages, organized separately, and often in conflict. These difficulties, caused by differing ideas and languages, undoubtedly contributed to Marx’s life-long search for organizational ways to overcome them and unite workers’ struggles across national, ethnic, and linguistic differences.30 In this situation, it is not surprising that Marx’s studies of political economy were thoroughly mixed with the philosophical, legal, and political debates of the time. Engels, on the other hand, living and working in the midst of England’s burgeoning manufacturing industry, was drawn to examine closely, and analyze carefully, the capitalism that surrounded him, first in Germany, then in 29 30 a small degree of democracy (originally, in nineteenth century Britain, only those with property could vote for members of parliament) and limits on its power. In a few cases, e.g., Islamic monarchies such as Saudi Arabia, royal families still cling to power – while others, such as Donald Trump and his followers, aspire to such status, admiring others who seem to have achieved it, such as Vladimir Putin (1952−), Xi Jinping (1953−), Kim Jong Un (1982−), and Viktor Orbán (1963−). Among those he studied, according to Padover, were Adam Smith, James Mill (1773−1836), David Ricardo, his follower John Ramsey McCulloch (1789−1864), Jean-Baptiste Say (1767−1832), and Michel Chevalier (1806−1879), op. cit., p. 189. At the beginning of his Economic and Philosophical Manuscript of 1844 (see below) he also recounted studying the German socialists Wilhelm Weitling (1808−1871), Moses Hess, and Frederich Engels (his Outline), MECW, Vol. 3, p. 232. This problem continues to plague anti-capitalists world-wide. In these first decades of the twenty-first century, although English has, to some extent, become the common language of Empire for intellectuals, the bulk of material written about local struggles and assessing broader trends continue to be written in local languages and thus inaccessible to those unfamiliar with those languages. The arrival of the Internet and the creation of translation programs have ameliorated this situation somewhat, but the problem persists. As noted in the preface to the Polish translation of this essay, my inability to access Polish language materials on both Marx and Engels’ writings and on contemporary conditions in Poland was frustrating because it limited my knowledge of both past and present. Marx & Engels’ Studies of Crisies, 1843−1895 25 England.31 While Marx was still struggling with his Hegelian roots and writing “Contribution to the Critique of Hegel’s Philosophy of Law” (1843−44),32 Engels followed up his 1839 “Letters” and his 1842 reports from England by composing a systematic “Outline of a Critique of Political Economy” (1844), his first effort to set out elements of an understanding of crisis that they would soon share.33 In the “Outline”, after first developing a critique of some of the economic categories of classical political economy (including private property, trade, value, price, rent, labor, and capital), Engels turns to a discussion of competition (between capitalists, between workers, and between classes), monopoly and trade crises. He establishes what would remain as some (but not all) of the basic tenets of Marxian crisis theory: 1. Crises are caused by production outstripping available markets. This he analyzes in terms of fluctuations in supply and demand and the impact of price changes on production: If demand is greater than supply the price rises and, as a result, ­supply is to a certain degree stimulated. As soon as it comes on the market, prices fall; and if it becomes greater than demand, then the fall in prices is so significant that demand is once again stimulated. So it goes on unendingly …34 2. This overproduction is the result of there being no plan to equalize aggregate production and aggregate demand, but only the frenzied efforts of 31 Engels was by no means unaware or had lost interest in either philosophical or political debates. He wrote a number of articles for local radical newspapers – the Owenites’ The New Moral World and the Chartists’ The Northern Star – about events, debates and political movements on the continent. See Volume 3 of MECW. There are two parts to this text. The first is the main body of existing manuscript, MECW, Vol. 3, pp. 3−129. The second is an “Introduction,” MECW, Vol. 3, pp. 175−87. Both the first and the second are available, in a different translation, at https://www.marxists.org/, under the title “Critique of Hegel’s Philosophy of Right”. “Outline,” (October - November 1843) (Deutsch-Franzosische Jahrbucher, 1844), MECW, Vol. 3, pp. 433−43. Frederick Engels, “Outline of a Critique of Political Economy” (1843), first published in the Deutsch-Französische Jahrbüicher, 1844, MECW, Vol. 3, p. 433. Keep in mind that here, as elsewhere in Engels and Marx’s analyses of supply and demand, they are NOT thinking in terms of the supply and demand curves familiar to modern microeconomics, but simply of the quantities of commodities being supplied to or demanded in markets. With the exception of a little-known French philosopher and mathematician, Antoine Augustin Cournot (1801−1877), who wrote a book on Recherches sur les principes mathématiques de la théorie des richesses in 1838, such curves were unknown until late in the nineteenth century. 32 33 34 26 chapter 2 different capitalists to keep ahead of both workers and other capitalists.35 The implication, he argues, is that were workers to take over, they would produce only what they needed and thereby avoid crises. The law of competition is that demand and supply always strive to complement each other, and therefore never do so …36 The struggle of capital against capital, of labor against labor, of land against land … drives production to a fever pitch …37 If the producers as such knew how much the consumers required, if they were to organize production, if they were to share it out amongst themselves, then the fluctuations of competition and its tendency to crisis would be impossible.38 3. Beyond this Engels does not explain why, with no plan, production must outstrip demand enough to cause a crisis.39 The pattern of expansion, overproduction, crisis and recovery is a recurrent one: … trade crises, which reappear as regularly as the comets, and of which we have now on the average one every five to seven years. For the last eighty years these trade crises have arrived just as regularly as the great plagues did in the past …40 35 36 37 38 39 40 “Aggregate” in Keynesian macroeconomics is a synonym for total. In the case of production, it means the amount that all businesses will supply at a given price level. In the case of demand, it means the sum of all expenditures by consumers, business and government, plus net exports, also at various prices levels. In both cases, the aggregation is achieved by summing the monetary value of production and of expenditures. Ibid., p. 433. Ibid., p. 435. Ibid., p. 434. This claim, of the possibility of planning supply as to properly meet demand, neither more nor less, was one side of a debate that has raged ever since. Soviet 5-Year plans quickly became the object of critique by those skeptical of the possibility of comprehensive planning. Classic theoretical arguments against the possibility were laid out by Ludwig von Mises (1881−1973) and Friedrich Hayek (1899−1992). Economists and their models generally assume that capitalists will make small marginal adjustments in production in response to small changes in price and inventory and by so doing eliminate any kind of dramatic crisis of overproduction. The actual extent of crises, such as that of 1842 followed by the Chartist-led strikes, led Engels to foresee far more drama than imagined by economists. “Outline of a Critique of Political Economy,” MECW, Vol. 3, p. 433. Engels was by no means the first to recognize recurring patterns of general crisis. Malthus had argued for their existence against Ricardo, who believed that only single-market overproduction was Marx & Engels’ Studies of Crisies, 1843−1895 4. 27 The crises get progressively worse over time as capitalism develops: … each successive crisis is bound to become more universal and therefore worse than the preceding one.41 5. Finally, crisis accentuates conflict between classes and will lead ultimately to revolution: … and finally causing a social revolution such as has never been dreamt of in the philosophy of the economists.42 Engels sees in this pattern a strange contradiction within capitalism that he and Marx would refer to repeatedly in the years ahead: A stage must be reached in the development of production wherein there is so much superfluous productive power that the great mass of the nation has nothing to live on … that the people starve from sheer abundance.43 Yet he also sees in this growth of productivity the basis of a possible social order in which increased social wealth and less work would go together: This immeasurable productive capacity, handled consciously and in the interest of all, would soon reduce to a minimum the labor falling to the share of mankind.44 41 42 43 44 ­ ossible. Both the Welsh industrialist and reformer Robert Owen – whose ideas and folp lowers Engels and then Marx would soon critique – and the Swiss socialist Jean Charles Leonard de Sismondi (1773−1842) both observed and analyzed what economists would eventually call “business cycles.” See, Owen’s Report to the Committee of the Association for the Relief of the Manufacturing Poor (1817) and Sismondi’s Nouveaux principes d’économie politique, ou de la richesse dans ses rapports avec la population (1819). Observations of such regularity became so common as to eventually provoke 1) economists to construct mathematical models that generate cycles, including the kind of ever-worsening fluctuations that Engels predicted, e.g., William Baumol, Economic Dynamics (1951, 1959) and 2) government and private agencies to collect data to keep track of and help predict business cycles, e.g., the US Department of Commerce, the National Bureau of Economic Research, and a host of private “forecasting” efforts. Ibid., p. 434. Ibid., p. 434. Ibid., p. 435. Ibid., p. 436. 28 chapter 2 Thus, he offers the beginnings of a vision of post-capitalist society based not on utopian speculation of the sort then popular among English and French socialists, but rather on an analysis of the actual pattern of development of capitalism and the possibilities created. Two years later, in speeches at Elberfeld, Engels argues how this vision of less work could begin to be realized through the elimination of huge amounts of unproductive work. A businessman himself, it was easy for him to look around and identify numerous sources of wasted human time and energy in trade, i.e., speculators, swindlers, superfluous middlemen, exporters, commission agents, forwarding agents, wholesalers and retailers, all of which, he judges, “contribute nothing to the commodity itself.”45 But he goes on to identify many other areas where people are employed in jobs that exist only because of the inequities of capitalism, e.g., the police and those in the judicial system, primarily deployed against crimes provoked by unjustly distributed property, and standing armies used against workers at home and in colonies abroad and against other capitalist powers. Freeing all these millions from unproductive activities so that they could participate alongside those already employed in truly socially productive activities could reduce the labor required of each individual. Given a just distribution of social activity … the present customary labor time of the individual will be reduced by half simply by making use of the labor which is either not used at all or used disadvantageously. However, the benefits which communist organization offers through the utilization of wasted labour power are not yet the most significant. The greatest saving of labour power lies in the fusing of the individual powers into social collective power …46 45 46 Frederick Engels, “Speeches in Elberfeld,” (on February 8 and 15, 1945) first published in Rheinische Jahrbücher zur gesellshaftlichen Reform, 1845, MECW, Vol. 4, pp. 246−47. Ibid., pp. 251−2. Although Engels made no effort to actually count the number of people engaged in unproductive work or calculate by how much each individual’s workload might be reduced by shifting such people’s labor to more productive activities, odds have it that by his definitions the percentage of “unproductive” workers today is much higher than his speculations in 1845. Here too, Engels had his forerunners, from Aristotle, whom Marx would cite in Capital as dreaming of replacing slaves with robots, through William Godwin (1756−1836) who not only hoped for less work and more leisure but also argued that only capitalism stood in the way of progressively freeing people completely from work. See his Enquiry Concerning Political Justice and its Influence on Morals and Happiness (1793), (Harmondsworth, UK: Penguin Classics, 1985), especially Vol. II, Book VIII, Chapter VI: “Objections to this System from the Allurements of Sloth.” The parallels between their arguments are striking. Godwin wrote. “What is this quantity of labour that a state of equality will require . . . ? It is so light as rather to assume the guise of agreeable Marx & Engels’ Studies of Crisies, 1843−1895 29 Beyond the sphere of production, Engels goes on to make a similar argument about the labor savings that could be gained by reorganizing the sphere of reproduction, i.e., housing and family life. As one possible step, he recommends the proposals by Robert Owen to replace separate individual houses by communal palaces where both resources and labor could be saved through collective heating, cooking, etc.47 Thus, Engels’ concern with crisis and class struggle is directly connected with his vision of a world beyond capitalism, which workers can construct. No mere academic concern, but that of a revolutionary grappling with the present to change the future. Marx read Engels’ “Outline”, made a short, two-page summary of it in his notebooks and published it in the first (and only) issue of the Deutsch-­ Französische Jahrbücher. The failure of his summary to make any mention of Engels’ discussion of crises suggests that he was not yet focused on the issue.48 His own first effort at synthesizing his previous study of philosophy and his more recent study of economics, were the Economic and Philosophical Manuscripts of 1844, which he wrote during the summer before he met Engels in Paris and began to work closely with him. In that text, Marx draws from his reading of Adam Smith and other classical political economists the same conclusion as 47 48 relaxation and gentle exercise than of labour . . . There will be no persons devoted to the manufacture of trinkets and luxuries; and none whose office it should keep in motion the complicated machinery of government, tax-gatherers, beadles, excise-men, tide-waiters, clerks and secretaries. There will be neither fleets nor armies, neither courtiers nor lacqueys. It is the unnecessary employments that, at present, occupy the great mass of every civilized nation . . . From the sketch which has been given, it seems by no means impossible that the labour of every twentieth man in the community would be sufficient to supply to the rest all the absolute necessities of life. If then this labour, . . . were amicably divided among the whole, it would occupy the twentieth part of every man’s time . . . half an hour a day employed in manual labour by every member of the community would sufficiently supply the whole with necessaries.” pp. 745−46. Ibid., pp. 252−53. Some of these ideas were put into practice in “Red Vienna” in the late 1920s when the city was governed by the Social Democratic Workers’ Party of Austria. While passing through that city in 2012, I had the pleasure of being taken to explore the most famous of such housing, the Karl-Marx-Hof, built for about 5,000 residents. It is worth keeping in mind that in many indigenous communities around the world the kind of collective cooking, clothes washing, etc., that Engels envisioned are common, albeit not in modern public housing. I’ve observed such in both Mexico and India. The breaking up of such collective behavior is typical of capitalist tendency to divide and conquer in the sphere of the reproduction of labor-power – a process that has probably reached its nadir in American suburbs full of single-family dwellings, famously parodied (along with the kinds of people such division tends to produce) in the song Little Boxes written and sung by Malvina Reynolds (1900−1978) in 1962. Available on YouTube. “Summary of Frederick Engels’ Article,” MECW, Vol. 3, pp. 375−76. 30 chapter 2 Engels, namely that crisis in the overall economy results from overproduction driven by competition – between capitalists, between capitalists and workers, and between workers. He writes: Finally, as the amassing of capital increases the amount of industry and therefore the number of workers, it causes the same amount of i­ ndustry to manufacture a larger amount of products, which leads to over-­ production …49 And: Whilst labour brings about the accumulation of capital and with this the increasing prosperity of society, it renders the worker ever more dependent on the capitalist, leads him into competition of a new intensity, and drives him into the headlong rush of over-production, with its subsequent slump.50 Like Engels, he also emphasizes how the growth in the division of labor, while crippling workers within capitalism, does raise productivity, making possible the liberation of workers’ time from work and the flowering of human being beyond work. In parallel to Engels’ speeches at Elberfeld, Marx cites Friedrich Wilhelm Schulz (1797−1860): In France it has been calculated that at the present stage in the development of production an average working period of five hours a day by every person capable of work could suffice for the satisfaction of all the material interests of society …51 Finally, in these long-unpublished pages, Marx directly confronts the class antagonisms that underly all the competition leading to crisis: the capitalist imposition of alienating work, exploitation, and workers’ resistance. His analysis in these pages does not yet have the precision that his later theoretical work would make possible, but it does reveal the heart of the phenomenon of crisis – the antagonism between classes – and how revolution is the only path beyond it to communism. 49 50 51 “Economic and Philosophical Manuscripts of 1844,” MECW, Vol. 3, p. 238. Ibid., p. 240. Ibid., p. 242. The passage is from Schultz, Die Bewegung der Production (Movement of Production), Zurich und Winterthur, 1843. Marx & Engels’ Studies of Crisies, 1843−1895 31 When political pressures from the Prussian and French governments killed the Deutsch-Französische Jahrbücher, Marx joined the staff and wrote for the journal Vorwärts! Pariser Deutsche Zeitschrift, a liberal German language journal published in Paris, made more radical by Marx’s contributions. In them, he both critiqued others’ ideas and politics, which he felt were erroneous and dangerous – like those of Ruge with whom he had parted ways – and began to analyze those workers’ struggles he had found at the heart of crisis. In a long article – published in two issues of Vorwarts! – Marx attacks Ruge’s dismissive response to the June 1844 uprising of weavers in Silesia, then a province of Prussia.52 Like the vintners in the Moselle Valley, the weavers were suffering from competition resulting from trade. Unlike them, they were also suffering from the very capitalist introduction of labor-displacing machinery. Against Ruge’s dismissal, Marx hails the character of the weavers’ rising as social, as a true proletarian revolt – however limited – against not just the political system but against capitalism. Indeed, he compares their rising favorably with the recent worker strikes reported by Engels from England and those by weavers in Lyons, France a decade earlier. Citing a song sung by the weavers, he argues that the lyrics aimed not only at the machines that were ­displacing them but also at the “ledgers, titles to property” of their employers and the bankers, the “hidden enemy” behind those employers.53 His celebration of the revolt of Silesian weavers and condemnation of their repression so enraged the Prussian government that it successfully pressured the French government to close Vorwarts! and expel Marx from France in January 1845. Prior to that expulsion, a visit by Engels to Paris in late August and a meeting with Marx resulted in ten days of intense discussion and the beginning of their first joint project – an attack on the Young Hegelians. Conceived as a short pamphlet, Marx amplified the attack into a 300-page manuscript, published in February 1845 as The Holy Family: The Critique of Critical Criticism, Against Bruno Bauer and Company. In the course of his critique, Marx dissects and demolishes their critique of Proudhon, praising him both as the first to recognize the negative effects of changing property relationships on human society and as having his analysis firmly anchored in the real concrete life of social struggle. 52 53 “Critical Marginal Notes on the Article ‘The King of Prussia and Social Reform. By a Prussian,” Vorwärts!, August 7, 10, 1844, MECW, Vol. 3, pp. 189−206. Engels had mentioned the turmoil in Silesia in two articles written for The Northern Star, No. 346, June 29, 1844, MECW, Vol 3, pp. 530−31 and pp. 532−34. His attention to these workers’ own words, can be seen as a forerunner to his later “Worker’s’ Inquiry” (1880), aimed at a systematic study of workers’ own perspective on their work, exploitation, and alienation. 32 chapter 2 While Marx was finishing that project, Engels proceeded on his own to research the conditions of life and struggles of workers within the accumulation of capital in Britain. Based on his study of official reports and his personal observations, he then wrote a detailed analysis of his findings. His research covered both working conditions in factories and the lives of workers outside those satanic mills: their poverty, horrible living conditions, inadequate nutrition and susceptibility to disease, all worsened by periodic losses of jobs and income during commercial and industrial crises.54 The result was his authoritative The Condition of the Working Class in England (1845), dedicated to “the working classes of Great Britain.”55 In two chapters, Engels develops his analysis of crisis and class struggle. The capitalists’ pitting of Irish workers against English ones, he argues, “has deepened the chasm between workers and the bourgeoisie, and hastened the approaching crisis.” He draws upon the medical notion of crisis and applies it to capitalist society. The course of the social disease from which England is suffering is the same as the course of a physical disease; it develops according to certain laws, which has its own crises, the last and most violent of which determines the fate of the patient. And as the English nation cannot succumb under the final crisis, but must go forth from it, born again, rejuvenated, we can but rejoice over everything which accelerates the course of the disease.56 At the same time, as before, he focuses on crisis as a necessary outcome of the “unregulated production,” the outcome of industrial competition, and insists on the “perpetual” periodicity of the cycle. Once more, he attributes the onset of crisis to the problem of overproduction, or the glutting of the market. He 54 55 56 On the devastations of disease due to low income, execrable living conditions and lack of medical care, see, MECW, Vol. 4, pp. 364−65, 396−400. Perhaps the most notable parallels during the current pandemic of Covid-19 are Engels’ descriptions of the grossly overcrowded living conditions of workers and their families – the universal prescription for the spread of disease. Much the same problem persists today among those at the bottom of the income hierarchy: those who can barely afford to rent a roof over their heads, much less multiroom dwellings where intra-family “distancing” is possible and among those with no roof at all, homeless and living in the street, often huddled in little clusters of tents under overpasses or in abandoned buildings. MECW, Vol. 4, pp. 295−583. MECW, Vol. 4, p. 419. Engels rejoicing at “everything which accelerates the course of the disease” would become a recurrent theme among not only Marxists but also reactionaries in the form of “accelerationism.” Marx & Engels’ Studies of Crisies, 1843−1895 33 implicitly supposes that all markets for particular goods would eventually be glutted, and that the problem arises because capitalist producers cannot judge when that will happen. In this work, he details the phases of the crisis more systematically than he had done in the “Outline”.57 He also describes more completely the process through which speculation and credit act both to stimulate investment and production and to accelerate collapse.58 Engels’ major innovation, however, dealt with the relation between crisis and the class struggle. He formulated more clearly how the maintenance of competition among workers, e.g., between the English and the Irish, constituted the key to capitalist control and how the generation of an unwaged “reserve army” increased that competition. The rapid growth of the reserve army, which occurs during crises as workers are laid off, has two effects. First, it weakens those who retain their jobs, making it easier for capitalists to force down wages. Second, this very process contributes to the growth in class ­tensions, especially anger among those who lost their jobs. As a result, those workers …. … begged, not cringing like ordinary beggars, but threatening by their numbers, their gestures and their words … Here and there disturbances arose … The most frightful excitement prevailed among the workers until the general insurrection broke out throughout the manufacturing ­districts.59 In his chapter on “labor movements” Engels traces how these tensions grew and were transformed by workers into combinations and trade unions, ­escalating their struggles into an intense conflict between the classes. In his political analysis of these workers’ struggles, his theory of crisis plays a critical 57 58 59 Ibid., pp. 381−82. Although all investment is a kind of speculation on uncertain future profits, here Engels is referring to money spent buying either commodities or securities in anticipation of either an increase or decrease in their value. In such speculative expenditures profit is sought, not by employing workers and the means of production to produce new commodities – what many economists call “real investment” – but rather by gambling on the future prices of the items purchased. Speculation can stimulate the economy to the degree that the excitement stimulated by the influx of money actually results in more real investment. But to the degree that it merely contributes to unsustainable overproduction of commodities or to a “bubble” in asset prices, the inevitable sudden fall in prices or devaluation of assets creates a crisis. MECW, Vol. 4, p. 387. 34 chapter 2 role. On the one hand, he argues that the laws of supply and demand would always conquer the unions: All these efforts naturally cannot alter the economic law according to which wages are determined by the relation between supply and demand in the labor market. Hence the Unions remain powerless against all great forces which influence the relation.60 However, he also argues forcefully that these struggles are by no means hopeless but are indeed essential. They prevent capitalists from lowering wages as quickly as they otherwise would during a downturn and “then too, the unions often bring about a more rapid increase of wages after crisis than would otherwise follow.”61 In this way, “the active resistance of the English working-men has its effect in holding the money greed of the bourgeoisie within certain ­limits.”62 But more than this, these short-term struggles over wages point beyond the trades unions whose power is limited by the institutional framework. Trade union struggles, Engels writes, constitute “schools of war” for workers preparing them for revolution: These strikes, at first skirmishes, sometimes result in weighty struggles; they decide nothing, it is true, but they are the strongest proof that the decisive battle between bourgeoisie and proletariat is approaching. They are the military school of the workingmen in which they prepare themselves for the great struggle, which cannot be avoided.63 Because the crisis reappears; the struggles reappear: Stagnation in business and the want consequent upon it engendered the revolt at Lyons in 1834 … in 1842 at Manchester, a similar cause gave rise to a universal turnout for the Charter and higher wages.64 60 61 62 63 64 Ibid., p. 505. Eventually, Engels and Marx would demonstrate how some of those “great forces” are not exogenous but are shaped by workers’ struggles. Ibid., p. 506. Ibid., p. 507. Ibid., p. 512. The gist of these arguments would be reiterated in Marx’s lectures in 1865. See below, p. 40. Ibid. Marx & Engels’ Studies of Crisies, 1843−1895 35 The crisis of 1842 came on. Agitation was once more as vigorous as in 1839.65 Based on this pattern Engels accurately predicts not only the subsequent crisis of 1847 but also a renewal of struggle—albeit not as successful as he hoped. The approach to Socialism cannot fail, especially when the next crisis directs the workingmen by force of sheer want to social instead of political (parliamentary action) remedies. And a crisis must follow the present active state of industry and commerce in 1847 at the latest … The working men will carry their Charter …66 As the crisis of 1847 unfolded, Engels narrates how as cotton textile factories laid off workers and announced a reduction in wages for those still employed, a meeting of worker delegates “from all over the country” threatened to strike: This strike, together with the strike of the Birmingham iron-workers and miners which has already started, would not fail to assume the same alarming dimensions which signaled the last general strike, that of 1842.67 At the same time, Engels saw how the “liberal” bourgeoisie tried to use the crisis against both workers and landlords by fomenting protest against the Corn Laws, e.g., tariffs against imported grain. Passed in 1815 in the wake of the Napoleonic Wars (1803−1815) at the behest of landlords, the Corn Laws (1815−1846) kept up the price of grain and by so doing also kept up landlords’ rents. Inevitably, the high price of grain also made bread more expensive, forcing capitalists to pay higher wages and obtain lower profits than they would like. Thus, their opposition. In support of their condemnation of the Corn Laws, capitalists drew on the political economist David Ricardo who argued that rising wages (due to the higher price of bread) and increased rents, which financed only the ­luxurious lifestyles of the landed aristocracy, squeezed industrial profits, which were 65 66 67 Ibid., p. 520. Ibid., p. 524. While time proved Engels right about how crisis engenders uprisings, it proved his optimism overblown about “the working men ... carrying their Charter.” They never did. It wasn’t until the Reform Act of 1867 that substantial numbers of working men gained suffrage – itself only one of the Chartist demands. Women would only gain equal suffrage in 1928 – as the result of decades of struggle. Frederick Engels, “The Commercial Crisis in England – The Chartist Movement – Ireland,” October 23, 1847, (La Reforme, Oct. 26, 1847) MECW, Vol. 6, pp. 308−9. 36 chapter 2 vital to investment and growth.68 So, they organized against those laws, forming a nation-wide Anti-Corn Law League in 1839. When the crisis of 1842 came on, they saw an opportunity to incite workers in their cause, appealing to the latter’s need for cheaper bread. In his chapter on labor movements, Engels describes how some capitalists provoked workers into action in the hope workers would turn their frustration and rage against the landlords. The bourgeoisie was determined to carry the repeal of the Corn Laws with the help of the crisis, the want it entailed, and the general excitement [worker protests] … the Liberal bourgeoisie half abandoned their law-abiding habits; they wished to bring about a revolution with the help of the workers … But how to provoke that help? With the crisis causing capitalists to lay off workers and unemployment rising, those workers who still had their jobs were loath to walk off them in protest. it was not the working-men who wished to quit work, but the manufacturers who wished to close their mills and send the operatives into the country parishes upon the property of the aristocracy, thus forcing the Tory Parliament and the Tory Ministry to repeal the Corn Laws.69 68 69 Against this support for Anti-Corn Law legislation, the landlords had Thomas Malthus (1766−1834) who defended the laws, basically arguing that given the recent wars, England needed to be self-sufficient in food production and keeping tariffs on grain high would help achieve that. See his The Corn Laws (1814) and his Grounds of an Opinion on the Policy of restricting the Importation of Foreign Corn (1815). To this Ricardo responded first, that once large scale exports of grain to England became normal and expected, no country could shut off such exports without disastrous consequences to their own agriculture and the danger of popular revolt (he cited the results of Bonaparte’s cutting off of Russian grain exports as an example), second, England could, as in the past, obtain grain from other countries especially once the free opening of British markets led producers in other countries to expand production expressly for the purposes of exporting to England, and third, that any decline in English agricultural production due to cheap grain could be softened by an gradual freeing of trade and at any rate capital withdrawn from agriculture would be invested in manufacturing to good effect and any decline in landlord consumption due to the fall in rents would be compensated for by a rise in the expenditure of profits and wages. See his An Essay on the Influence of a Low Price of Corn on the Profits of Stock (1815). Ibid., p. 520. Engels drew upon this chapter for an article on “The History of the Corn Laws” for the Telegraph für Deutchland, December 1845, MECW, Vol. 4, pp. 656−61. Marx & Engels’ Studies of Crisies, 1843−1895 37 Unfortunately for the capitalists, as Engels details, instead of going after the landlords, thousands of workers, who were outraged at having their wages cut, instead mobilized against the capitalists demanding “a fair day’s wages for a fair day’s work” and spread their strikes quickly from mill to mill and town to town. At which point, as Engels relates “the bourgeoisie … resumed its law-abiding attitude, and placed itself upon the side of the government as against the working-men.”70 Beyond his descriptions and theory of crises and class struggle, Engels also used his analysis as the basis for an explicit critique of the bourgeois socialists of his day (such as the English Owenites and the French Utopians). His support for strikes and wage struggles included support for the Chartists whose cause he openly endorsed. This was a position that he and Marx would continue to hold through the forties as they broadened their writings to develop these views in The German Ideology (1844−45),71 in the Poverty of Philosophy (1847),72 and in the Communist Manifesto (1948). As Marx and Engels’ first joint work, The Holy Family (1845) was primarily concerned with their critique of the Young Hegelian socialists, so too was their second, The German Ideology. Although The German Ideology represented a distinct advance in the development of their perspective, especially the first section on Ludwig Feuerbach (1804−1872) where they set out their view of history, it had virtually nothing to add to the work Engels had already done on crises within capitalism. Rather, the major thrust was to set out their views on the centrality of class conflict in the evolution of social orders and to distinguish the class struggles of capitalism from those in earlier class societies. They distinguished between the “productive forces” and the “forms of social intercourse” or, as they would later say, the “relations of production.” The development of the former, they argued, is at first stimulated by, but then constrained by the latter. This situation they saw as key to the collapse of one social order and the transition to the next. In this sense, their work did contribute to the theory of crisis, at least with respect to the fundamental forces acting to undermine capitalism as a system: Thus, all collisions in history have their origin, according to our view, in the contradiction between the productive forces and the form of intercourse.73 70 71 72 73 Ibid., p. 521. MECW, Vol. 5, pp. 19−537. MECW, Vol. 6, pp. 105−212. MECW, Vol. 5, p. 74. 38 chapter 2 The concrete specificity of this development, however, remains even less clear in The German Ideology than it was in Engels’ works, where the periodical contradiction between the productive forces (as production/output) and the forms of intercourse (the market) was defined in terms of an overproduction crisis and accentuated working-class struggle on the path to revolution. Much of Marx and Engels’ subsequent work on crisis in which the forces and dynamics of this process are more fully developed, can be seen as the elaboration of the concept of the “forms of intercourse” acting as fetters on the productive forces. As spelled out in Chapter 3 below, this reaches its fullest development in Marx’s “mature” works where the “forms of intercourse” are grasped in terms of the necessary imposition of – and worker resistance to – labor, value and the surplus value; all of which become harder and harder to impose as production and productivity expand. 1.2 Brussels Based on their experiences in France and England, and the analysis in the “Outline” and in The Condition of the Working Class in England, Marx and Engels decided to begin political organizing in 1846−47. Expelled from Paris by the Guizot government in January 1845, Marx moved to Brussels. There, after working with Engels on The German Ideology and joining the newly formed International Democratic Association, they decided to launch a Communist Correspondence Committee to broaden their contacts and expand the number of adherents to their analysis before engaging directly in any existing political movement. Through exchanges of letters and meetings they sought to link together, through themselves, working class militants in Germany, France, and England. Their major effort in his project was directed toward the League of the Just, a clandestine organization based in London among German émigrés, with a public German Workers’ Educational Union. The League’s members had left behind the insurrectionism of Louis Auguste Blanqui (1805−1881), turning first to the utopianism of Fourier and Cabet in France but then moving towards the Chartists.74 As already mentioned, Engels had established close ties with the Chartists and written several articles for their journal. When the League of the Just convened a congress in 1847, members adopted many of Marx and Engels’ ideas and changed the name of their organization to the Communist League. At that point, Marx “turned the Brussels Corresponding Committee into a branch” of the renamed organization. 74 See McLellan, Chapter III, Section III on “The Founding of the Communist League,” pp. 154-76. Marx & Engels’ Studies of Crisies, 1843−1895 39 Failing to attract Proudhon to their Committee, Marx and Engels complemented their support for the Chartists with attacks on the French socialist movements. Although he had praised Proudhon in The Holy Family, in his polemical Poverty of Philosophy (1846−47) Marx excoriates the man’s economic analysis, his method, and his politics. Here, as they would do in the Communist Manifesto (1848), the theory of crisis bolstered their advocacy of working-class wage struggle and revolution against utopians, bourgeois socialists and others. He used arguments similar to those laid out earlier by Engels in The Condition of the English Working Class75 to attack Proudhon’s opposition to wage struggles. Proudhon had argued against them on the grounds that wage increases could only lead to higher prices and hence scarcity. Against that argument, Marx points out that wage struggles lead not only to price increases, but also to the development of production as capitalists are forced to introduce new machines to replace troublesome workers. (This important point is taken up in detail in Chapter 4, Section 4.3 below.) Again, like Engels, he points out that worker combinations and strikes had been ­growing constantly: In spite of both of them [economists and socialists], in spite of manuals and utopias, combination has not ceased for an instant to go forward and grow with the development and growth of modern industry.76 Why was this? Because, Marx writes, of the very dynamic of industrial organization and the exploitation of workers: Large-scale industry concentrates in one place a crowd of people unknown to each other. Competition [between workers] divides their interests. But the maintenance of wages, this common interest which they have against their boss, unites them in a common thought of ­resistance-combination.77 75 76 77 MECW, Vol. 4, pp. 375−388, 397−99, 501−29; 579−83. Karl Marx, “The Poverty of Philosophy” (1847), MECW, Vol. 6, pp. 105−210. Ibid. Eventually, in the late 1970s, the high development of workers’ self-organization and struggle in large factories and offices led to a reversal of the tendency to concentrate workers that Marx identifies. Some capitalists began to consciously disperse their labor force – a sort of return to something like the early putting out system in which employees work at home on machines and raw materials provided by their employers – whether material or digital – and once transformed/produced into output returned to them. When this reversal began to be noticed in Italy, it led to a national conference on the “Diffused Factory” in June of 1978, at the Università degli Studi di Milano, Milan, Italy. Much of the 40 chapter 2 This transformation of resistance into permanent combinations spreads, Marx notes, until it assumes the general character of a struggle in which the workers affirm themselves as a class. If the first aim of resistance was merely the maintenance of wages, ­combinations, at first isolated, constitute themselves into groups as the capitalists in their turn unite for the purposes of repression, and in face of always united capital, the maintenance of the association become more necessary … In this struggle—a veritable civil war—all the elements necessary … for a coming battle unite and develop. Once it has reached this point, association takes on a political character … In the struggle, of which we have pointed out only a few phases, this mass becomes united, and constitutes itself as a class for itself, the interests it defends become class interests.78 As in Engels’ “schools of war,” Marx argues that only through combinations and strikes does the working class really become a class capable of overthrowing the bourgeoisie. He said little about the relation between crises and the class struggle, but where he did mention it, he implied that the struggles were often less intense during periods of prosperity, thus agreeing with Engels’ linking of more intense class struggle with periods of crisis. If in 1844 and 1845 strikes drew less attention than before, it was because 1844 and 1845 were the first two years of prosperity that English industry 78 discussion at that conference, which I attended, focused on the role of this “diffusion” of workplaces in the evolution of class struggle in Italy – given how the spatial dispersal of workers makes their autonomous interaction and coordination difficult. For a sample of the issues, see Quaderni del territorio: ristrutturazione produttiva e nuova geografia della forza-lavoro (anno I, n. 1, 1976). Since then, “work at home” has become fairly common, both among regular employees, especially but not uniquely among those who work on computers and whose work is easily monitored by their employers, and precarious workers hired for one task at a time. In the wake of the student movements of the 1960s, there was some experimentation in the US with the “diffusion” of campuses that would make it hard for students to organize. Such “diffusion” of labor expanded considerably during the Covid-19 pandemic in both industry and in schools. Since then, the discovery by stay-at-home workers of the advantages of managing your own work without direct oversight has prompted some business to try get them back in the office and under immediate supervision. The long-term impact on the organization of work remains to be seen – and will, undoubtedly, be determined by struggle between workers and their bosses. “The Poverty of Philosophy”, MECW, Vol. 6, pp. 210−11. Marx & Engels’ Studies of Crisies, 1843−1895 41 had had since 1837. Nevertheless, none of the trades unions had been ­dissolved.79 When the Communist League decided a “confession of [their] faith” should be drafted and discussed, Engels set to work, eventually coming up with a text titled “The Principles of Communism.”80 In that text, which amounted in many ways to a first draft of the Communist Manifesto,81 he reiterates his earlier analysis of crises within capitalism and how they would lead to revolutionary “ferment.” With the rapid growth of capitalist industry, he writes, very soon more was being produced than could be used. The result was that the goods manufactured could not be sold, and a so-called trade crisis ensued. Factories had to stand idle, factory owners went bankrupt, and the workers lost their bread … After a while the surplus products were sold, the factories started working again, wages went up, and gradually business was more brisk than ever … the state of industry has continuously fluctuated between periods of prosperity and periods of crisis … and every time it has entailed the greatest misery for the workers, general revolutionary ferment, and the greatest danger to the entire existing ­system.82 The gist of this account was applied by Marx to fluctuations in wages in lectures given in December of 1847, but not published until later (see below).83 Written primarily by Marx but drawing on Engels’ “Principles” draft, the Communist Manifesto announced the political credo of the Communist League. The Manifesto was written during the crisis of 1847, just before the revolutions that swept Europe in 1848. The Manifesto provided both an analysis of the development of capitalism—including its crises—and a prescription for action in the forthcoming social conflict. At last, Engels’ analysis of crisis began to be integrated in an important way into their joint works in support of their political position. Beyond The German Ideology, where crisis was conceived in the very general terms of “the history of the revolt of modern productive forces against modern conditions 79 80 81 82 83 Ibid., p. 208. MECW, Vol. 6, pp. 341−357. Terrell Carver does a side-by-side comparison of passages in the two texts in his Marx & Engels: The Intellectual Relationship (Bloomington: Indiana University Press, 1983), 87−94. MECW, Vol. 6, p. 347. Karl Marx, “Wages,” MECW, Vol. 6, pp. 424−25, 429−30, 432. 42 chapter 2 of production,” or against forms of “social intercourse,” in the specific case of capitalism, the “productive forces” are the machines, workers, and their organization while the “conditions of production” are, above all, the need to sell the commodities produced in markets. They see crises emerging from the inability to coordinate the two phenomena. It is enough to mention the commercial crises that by their periodical return put on trial, each time more threateningly, the existence of the entire bourgeois society.84 So, the contradiction between the forces and relations of production lead to revolution via the path of Engels’ recurrent, worsening crises. What is the ­origin of these crises? What exactly is meant by the inability to control the productive forces? The meaning lies in the tendency for production to outstrip the bourgeois ability to handle it: In these crises there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity—the epidemic of over-production … there is too much civilization, too much means of subsistence, too much industry, too much commerce … The conditions of bourgeois society are too narrow to comprise the wealth created by them.85 But if Marx means more by the phrase “too narrow to comprise the wealth” than commercial breakdowns, he does not specify it here. Nor would he set out a systematic explanation for some years. But if he does not explain the forces involved in this loss of control, he does see clearly how capital deals with the problem: And how does the bourgeoisie get over these crises? On the one hand by enforced destruction of a mass of productive forces; on the other by the conquest of new markets, and by the more thorough exploitation of the old ones.86 And yet, these measures cannot solve the problem permanently because the same forces that have led to the development of the productive forces will do so again with the same result: 84 85 86 Karl Marx & Frederick Engels, “The Communist Manifesto” (1848), MECW, Vol. 6, p. 489. Ibid., pp. 489−90. Ibid., p. 490. Marx & Engels’ Studies of Crisies, 1843−1895 43 That is to say, by paving the way for more extensive and more destructive crises, and by diminishing the means whereby crises are prevented.87 These crises of capitalism are linked to the rise of the proletariat and to the class struggle by the growth of industry and trade which tend to unite the working class secularly in their struggles with capital. As they become “­concentrated in greater masses,” crises aggravate those struggles by increasing the fluctuations of wages: The growing competition among the bourgeois, and the resulting commercial crises, make the wages of the workers even more fluctuating … the collisions between individual workmen and individual bourgeois take more and more the character of collisions between two classes. There upon the workers begin to form combinations (Trade Unions) against the bourgeois; they club together in order to keep up the rate of wages.88 Although he was not very clear, Marx again seems to be arguing that working class struggles—aimed at “keeping up” wages in the face of fluctuations— would be particularly intense during periods of downturn and crisis. Certainly, this was consistent with his and Engels’ observations on the rise of the Chartists after the crisis of 1836, their experience in 1846 to 1848 and Marx’s critique of Proudhon. But if the Communist Manifesto primarily presents an analysis of the class struggles of a rapidly developing capitalism, it was also written in a period in which that development on the continent was constrained and hindered by governments not yet under the control of capitalists. Both France and Prussia were ruled by authoritarian monarchies. Thus, the support of Rhineland industrialists for the Rheinische Zeitung whose pages regularly carried articles critical of those constraints. Thus too, the government censorship, harassment, and ultimate banning of the paper, complemented by driving its most acerbic critic, Marx, out of the country. The same drama was repeated in Paris, by the French and German governments closing down the Deutsch-Französische Jahrbücher and then, Vorwärts! while forcing Marx to leave France for Belgium.89 87 88 89 Ibid. Ibid., pp. 492−93. The contemporary, early twenty-first century, return of authoritarian behavior among neo-fascist governments in Europe and the US, has brought a return to attacks on independent criticism in the press quite like what Marx and comrades were experiencing in 44 chapter 2 Beyond these general observations and endorsements of wage struggles, Marx and Engels also focus on the historical specificity of the crisis of 1846−48 that they see leading toward inevitable uprisings against the established orders. They argue – against the views of petty-bourgeois, “true” bourgeois, and critical utopian socialists – that working-class struggle is absolutely necessary. They see these upheavals in Europe as crises, not of capitalism but of the existing monarchies, which claimed absolute power, unchecked by either the emerging capitalist class or by workers. Thus, they view these uprisings as bourgeois revolutions aimed at replacing the power of monarchs with elections, some form of democracy. Through these means capitalists seek control of the state, civil liberties, and freedom of the press, which would provide both vehicles to spread bourgeois ideology and better flows of information about problems facing their ability to govern.90 Such changes, Marx and Engels judged, would improve the terrain of struggle for workers. Therefore, they called for the 90 the 1840s. Trump-the-pathological-liar’s unsubstantiated branding of all critical reports as “fake news” has been adopted by several authoritarian governments in Europe. (At last check, the Washington Post had cataloged over 30,000 Trump lies.) These attacks have been aimed at obscuring stepped up repression of a wide variety of hard-earned rights, through legislative action and vicious rhetoric which has encouraged violence – against both individuals and democracy itself, e.g., voter repression and the January 6, 2021 effort to block the peaceful transfer of power through a physical assault on the US Capitol. Along with the attacks on women’s reproductive rights, by SCOTUS’ overturning of Roe and the passage of anti-abortion legislation in all too many states, we are also seeing a new wave of attacks on LGBT+ rights. In June 2021, Hungarian lawmakers passed legislation banning any mention of LGBT+ in schools or any media available to minors – in direct violation of EU rules. https://www.pinknews.co.uk/2021/06/15/hungary-anti-lgbt-homophobia-propaganda-law-ban-fidesz-viktor-orban-section-28/ This anti-LGBT+ crackdown is being repeated in the US by neo-fascist state governments such as DeSantis’ in Florida with his “Don’t Say ‘Gay’” law. Although Marxists, for obvious reasons, have generally emphasized the ideological role played by the capitalist press – which has never been as “free” as it has pretended – just as important has always been the interclass intelligence provided to capitalist policy makers by reporters’ stories about conflicts within the system. A “free press” dramatically multiplies ruling classes’ sources of intelligence. These sources of information often arrive sooner, and sometimes are more reliable, than more “serious” studies of such conflicts by academics and government bureaucrats commissioned to study them. One of the great weaknesses of authoritarian governments that suppress such information flows is how they rarely know what is going on before conflicts explode. This weakness of nineteenth century pre-capitalist authoritarian governments was replicated in the twentieth century in the USSR and its client states – as was plainly revealed in upheavals such as those in East Germany in 1953, in Hungary in 1956, in Czechoslovakia in 1968, in the food protests in the USSR in the 1970s, in the emergence of Solidarność in Poland in 1980 and ultimately in the collapse of those regimes. In case after case, the suppression of the press and of revelatory dissent resulted in uprisings for which the regimes were totally unprepared, Marx & Engels’ Studies of Crisies, 1843−1895 45 working class to support such revolutions as a necessary step – one that would dramatically improve political conditions – before turning against the bourgeoisie itself. This position, they would later decide, in the light of subsequent events, was ill-advised. When the continental upheavals of 1848−49 exploded with the ­February Revolution against King Louis Philippe in France, the March Revolution against King Frederick William IV in Germany and uprisings in Italy, Austria, and so on, Marx and Engels found themselves no longer theorizing about crisis and revolution but face-to-face with the reality. They immediately joined the fray, supporting both demands for democracy against feudal and monarchical power and insurrectionary actions. When the Democratic Association in Brussels demanded that the Belgian government arm workers, several of its members, including Marx and his wife were arrested, briefly jailed and deported. 1.3 Paris From Belgium they travelled to Paris where Marx’s previous expulsion was rescinded by friends in the new Second Republic government who invited him back. There, Marx took part in the political meetings of the Society of the Rights of Man and sought out militant groups of German workers. Once joined by Engels, they set up a German Workers’ Club and created a new Central Committee of the Communist League. As events unfolded, they opposed the formation of a militia of armed German workers to overthrow the Prussian government from the outside. When others did form a “German Democratic Legion”, it was quickly crushed. On the other hand, when news came of mass demonstrations in Berlin and of King William conceding parliamentary elections, a constitution and freedom of the press, Marx and Engels returned to Cologne – with copies of the Communist Manifesto in hand – to join the revolution. They also brought with them leaflets containing “The Demands of the Communist Party in Germany” calling for such things as the unification of Germany, universal suffrage, arming of the people, land reform to free peasants of feudal obligations, nationalization of transport and making it free to having lost the potential for preventive measures that better information might have made possible. The flip side, the vulnerability to capitalist rule created by a “free press” are the ways workers have found to use it for their own purposes, from using reports in capitalist media to circulate their analyses and even their struggles (more efficient than illegal efforts like samizdat in the USSR and Eastern Europe), to the creation of their own above-ground press media, from handbills and flyers to newspapers and journals to circulate their ideas more effectively – as Marx and Engels repeatedly sought to do through their journalism. 46 chapter 2 “the impecunious classes,” a progressive income tax, state guaranteed employment – to offset the negative effects on workers of capitalist crises – and free education.91 1.4 Cologne In Cologne, they created a “Neue” Rheinische Zeitung through which they ­carried on their propaganda work. When conflicts in the Communist League led to the dissolution of its Central Committee in May of 1848, the Zeitung became the focal point for their organizational work as well as their propaganda. During this period of almost a year, Marx and Engels worked, through their paper and political co-workers, to influence the direction of the struggle. Everywhere in Europe, the old order was being challenged, in national assemblies by bourgeois democrats and in the streets by workers demanding both democracy and improvements in their wages, working conditions and standards of living. In the beginning, Marx and Engels argued forcefully for the strategy developed in the Manifesto: support for working-class struggles, but also for the bourgeois revolt against absolutism. They argued against those who would confine workers’ struggles to “economic” issues, e.g., wages, arguing the need for both workers and peasants to join the fight to change the political system to gain more latitude for struggle, e.g., freedom of the press, which in those moments made their Zeitung possible. But, as events unfolded in 1848, Marx and Engels were forced to modify their position by overwhelming evidence that the bourgeoisie was not taking sufficient action or leadership to ensure the success of what they viewed as its own revolution – one spearheaded by workers, but in support of capitalist priorities. In France, they saw the National Assembly turn against the workers by moving to abolish the National Workshops that provided wages. That action brought on the “June Days” of revolt, viciously repressed by the new government. In country after country, they saw liberal capitalists joining with conservatives to compromise with absolutism and betray the very workers and peasants who had been in the streets fighting for their demands. In “The June Revolution”, Marx analyzed the betrayal in France, which led to Cavaignac’s slaughter of thousands and the deportation of thousands more.92 That betrayal, he argued, outlined a pattern repeated elsewhere on the continent. In his analysis, he directly addressed the relationship between class struggle and industrial crisis. Unemployed workers had risen in February against the regime of King Louis Philippe during a crisis, demanding the creation of public employment 91 92 MECW, Vol. 7, pp. 3−5. “The June Revolution,” Neue Rheinische Zeitung, June 28, 1848, MECW, Vol. 7, pp. 144−49. Marx & Engels’ Studies of Crisies, 1843−1895 47 (the National Workshops) to ward off poverty and starvation, as well as participation in government, the Second Republic and National Assembly. But that government, with only two members representing workers’ interests, not only canceled the workshops but also proved unable to deal with crisis. It was not, Marx writes, “within the power of any assembly any more than of a king to tell a universal industrial crisis – advance up to this point and no further.”93 All it did do was abandon any effort to alleviate worker suffering and by so doing bring on greater revolt. If, during most of 1848, the Neue Rheinische Zeitung had played down the class conflict between workers and capital, the abandonment of leadership by the bourgeoisie caused them to re-emphasize the autonomy of the working class and support independent action on its part as the only way to avoid catastrophe. To spell out their analysis of this abdication by the Prussian bourgeoisie of its role, Marx wrote a series of articles: “The Bourgeoisie and the Counter-Revolution” in December.94 To bring the working class-capital conflict back to the center of discussion by showing how the interests of workers and capitalists were opposed, Marx published another series of articles in the Zeitung under the title “Wage Labor and Capital” (1849) – essentially the lectures he had prepared the previous year.95 As was to become his wont, in these articles, Marx roots his analysis of wages in that of commodities in general because workers sell their labor-power to capitalists as a commodity. In his exposition, crisis is presented, once again, as the result of overproduction. First, crises for capital: These fluctuations, which, looked at more closely, bring with them the most fearful devastations and, like earthquakes, cause bourgeois society to tremble to its foundations … 96 And then crises for workers. As capital and its command over labor is accumulated, he explains, there is a corresponding increase in earthquakes … in a word, crises increase. They become more frequent and more violent … A lord, at once aristocratic and barbarous, [capital] drags with it into the grave 93 94 95 96 Ibid., p. 148. MECW, Vol. 8, pp. 154−78. MECW, Vol. 9, pp. 197−228. Ibid., p. 208, 48 chapter 2 the corpses of its slaves, whole hecatombs of workers who perish in the crises.97 Besides demonstrating the unavoidable opposition between workers and capitalists, Marx also countered reactionary arguments that blamed the depressed economy and high unemployment on the continent on social unrest. A Z ­ eitung editorial on the “The State of Trade,” published in March 1848, demonstrated with historical data how downturns were the result of overproduction exacerbated by speculation and accentuated by financial collapse and how the crisis of 1847 that originated in England circulated to the continent. He did not, however, entirely ignore the contribution of workers’ struggles to crises, while maintaining that capitalist behavior could lead to crises. “The revolutions,” he argues, “contributed to the fact that now and then trade stagnated … [but] In Southern Germany, on the Rhine, in Hamburg and in Berlin, with or without the revolution we would have had our bankruptcies.”98 As revolutionary efforts in Europe – by both timid bourgeois liberals and insurgent workers – were defeated by the old regimes, conflicts broke out among the factions fighting for change, financing for the Zeitung dried up and individuals suffered increased police and military repression. In September 1848, a state of siege was declared in Cologne and on October 4th an arrest warrant was issued for Engels and another editor of the paper.99 Engels and Marx were forced to leave the city. Marx went to Paris where he was again expelled and then moved on to London. Engels also left Cologne but joined the insurrection in Baden to give the popular army whatever advice he could, based on his own military training. He stayed until the revolt collapsed in July when he fled to Switzerland and eventually back to London. 1.5 London In London, Marx and Engels set about two urgent tasks. The first was rebuilding the Communist League. They felt that the defeats on the Continent would soon be followed by a new round of revolution, and they wanted to be 97 98 99 Ibid., p. 228. MECW, Vol. 9, p. 7. Eventually, this vision of crisis as occurring independently of w ­ orkers’ struggles would be abandoned as Marx discovered more and more of the “­internal” dynamics of capitalist development to be aspects of class struggle. Such passages, however, have provided some Marxists with grounds for their belief that overproduction as a cause of crisis is a phenomenon driven by forces autonomous of workers’ actions and the latter are mere reactions to the former. I return to this issue in Chapter 5 on “Predispo­ sitions to Crisis.” The other editor was not Marx, but Heinrich Bürgers (1820−1878). MECW, Vol. 7, p. 593. Marx & Engels’ Studies of Crisies, 1843−1895 49 organizationally prepared. This new upheaval they expected to envelope both England and the Continent, as the end of British prosperity of 1848−49 would coincide with crisis across the channel: … as this crisis will inevitably coincide with great clashes on the Continent, it will bear fruit of a very different type from all preceding crises. Whereas hitherto every crisis has been the signal for further progress, for new victories by the industrial bourgeoisie over the landowners and financial bourgeoisie, this crisis will mark the beginning of the modern English revolution.100 The effects of the trade crisis now breaking will be more significant than those of any crisis hitherto. It coincides with the agricultural crisis which already began with the repeal of the Corn Laws in England and was intensified with the recent good harvests. For the first time England is simultaneously experiencing an industrial crisis and an agricultural crisis. This double crisis in England is being hastened and extended and made more inflammable by the simultaneously impending convulsions on the Continent, and the continental revolutions will assume an incomparably more pronounced socialist character through the recoil of the English crisis on the world market.101 Political developments on the Continent are likewise pressing daily more urgently towards a showdown, and the coincidence of trade crisis and revolution, which has already been mentioned several times in this Revue, is becoming more and more certain.102 These comments, written in the spring of 1850, reflected both a continuing optimism that all was not lost and analytical links among prosperity, crisis, and the pattern of working-class revolt. Their autocritique and planning involved two thrusts. First, they reaffirmed their new belief in the necessity of autonomous working-class action even within an essentially bourgeois revolution. In the discussion and debate within the re-established Communist League, Marx and Engels emphasized this autonomy as a prerequisite for the inevitable conflict between workers and capital that would follow bourgeois success in overthrowing absolutist 100 101 102 “Review: January−February 1850,” MECW, Vol. 10, pp. 264−65. “Review: March−April 1850,” MECW, Vol. 10, p. 340. Ibid., p. 341. 50 chapter 2 regimes. They argued for maximizing working-class strength in the struggle against absolutism, including the maintenance of its own ability with arms after victory and the creation of working-class organizations and alternative state functions, as the only possible way to avoid subsequent defeat.103 Second, they undertook an extensive analysis of the experience of their own activity (in the Communist League) and of the course of the Revolution in general. Removed from the heat of the conflict for the first time in a year, they had time to reflect and to try to grasp the general forces that had shaped the Revolutions and that would shape the future. In this reflection, they leaned heavily on their analysis of economic crisis and its relation to the class struggle. Their initial optimism, however, did not last. As the counter-revolution was secured across Europe, Marx returned to his studies of political economy and a closer examination of the pre-1848 economic crises and their relation to the 1848 revolutions. The results of these studies were published as articles in the New Rheinische Zeitung Revue in 1848 and 1849. The most important of these articles, for their evolving theory of crisis and class struggle, was the “Review (of international economic and political development): May-October 1850,” which appeared in the last issue of the Revue.104 In this article Marx and Engels traced both the emergence of crisis in England as a product of the industrial and commercial expansion of 1843−45 and the spread of that crisis to the Continent. There is no major change in their interpretation of the causes and nature of crisis. They attribute its source to the emergence of overproduction despite the opening of new Far Eastern markets and new trade and investment outlets in the New World. There is no new explanation as to the reason why this overproduction is inevitable, but there is considerable analysis of the role played by speculation in accentuating its developments and impact. They analyze the development of speculation in railways, cotton, corn, and foreign trade – the expansion of credit and the creation of false ventures, e.g., those designed purely to make quick profits through stock issues on non-existent assets – one of those things that Marx would later analyze under the title “fictitious capital.” (See Chapter 5, Section 3.3.) Based on the real expansion of the British and continental railway systems and the speculation which was bound up with it, there gradually arose during this period a superstructure of fraud reminiscent of the time 103 104 History has demonstrated, again and again, that one of the first signs that a new post-­ revolutionary regime is turning against workers and peasants is the demand for the ­surrender of arms by everyone except the official police and military. “Review: May−October 1850,” MECW, Vol. 10, pp. 490−532. Marx & Engels’ Studies of Crisies, 1843−1895 51 of Law and the South Sea Company. There were projects for hundreds of lines which had not the slightest chance of success, which their very authors never had any intention of really carrying out and whose sole purpose indeed was to enable the directors to squander the deposits and to make fraudulent profits from the sale of stocks.”105 When this superstructure of speculation and fraud collapsed, it led quickly to the restriction of the production on which it had been based: Speculation regularly occurs at times when over-production is already in full swing. It provides channels by which this over-production may temporarily be diverted, whilst by this very process hastening the onset of the crisis and magnifying its impact. The crisis itself first breaks out in the field of speculation and only seizes hold of production later. Not over-production but over-speculation, itself only a symptom of overproduction.106 It was from this capitalist crisis at the English heart of the European economy that subsequent crises on the Continent sprang. “The first repercussions of the crisis appeared on the continent as early as October (1847) … As the crisis abated in intensity in Great Britain, so it increased on the Continent and affected places that it had not hitherto reached.”107 By the time the Revolutions broke out in France in February 1848 and in Germany in March, the crisis in England was over, but the crisis in those countries well under way. Marx and Engels grappled with the problem of trying to sort out the direction of 105 106 107 Ibid., pp. 491−92. The “Law” referred to here is John Law (1671−1729), a banker and ex-con from Scotland, who founded the Banque Générale Privée in 1716, nationalized a year later, at Law’s request, to become the Banque Royale or first central bank of France. He used it to create the Compagnie d’Occident (The Mississippi Company) in 1717 and obtain for it a government-sanctioned monopoly on trade in Louisiana and the West Indies. Law encouraged speculation on the Company’s shares, which resulted in the Mississippi ­Bubble that burst in 1720 and bankrupted the Banque. See, James Narron and David Skeie, “Crisis Chronicles: The Mississippi Bubble of 1720 and the European Debt Crisis,” New York Fed, Liberty Street Economics (January 10, 2014). https://libertystreeteconomics.newyo rkfed.org/2014/01/crisis-chronicles-the-mississippi-bubble-of-1720-and-the-european -debt-crisis/ The South Sea Company was a British joint-stock company, founded in 1711 and like the Mississippi Company was granted a monopoly to trade in the Americas – mainly in slaves. Here too speculation resulted in a dramatic rise in the value of the ­Company’s stock, the South Sea Bubble, which also burst in 1720. Ibid., p. 490. Ibid., p. 496. 52 chapter 2 causality between this economic crisis and the political upheavals that swept Europe, and they found causes running each way. With respect to, “The Panic which broke out in Paris after February and spread throughout the continent at the same time as the revolutions …”108, they find the causes indeterminate: In the case of failures of bankers and traders in other places on the Continent, it is impossible to decide to what extent they arose from the continuation and gradual spread of the commercial crisis … or to what extent they were really consequences of losses resulting from the revolution panic.109 Nevertheless, they offer the general reflection that: However, this much at least is certain, that the commercial crisis contributed infinitely more to the revolution of 1848 than the revolution to the commercial crisis.110 They used this same reasoning to understand how returning prosperity cut short class conflicts in England. They trace the numerous beneficial effects of the Continental upheaval on the economies of England and the United States. In both cases, new prosperity was partly built on the capital that flowed out of the Continent during the upheaval, and partly on the elimination of outlets for speculation, which forced capital into productive enterprise. They argued, that although the crisis had begun in England, its circulation to Europe had contributed to English prosperity, thereby helping to undercut all revolutionary movement there (that is, the Chartists), “The French Revolution of 1848 saved the English middle class,”111 where capital’s power and thus its ability to cope was greatest: While, therefore, the crises first produce revolutions on the Continent, the foundation for these is, nevertheless, always laid in England. Violent outbreaks must naturally occur rather in the extremities of the bourgeois 108 109 110 111 Ibid., p. 497. Ibid., p. 497. Ibid. “Preface” to the 1892 English edition of Condition of the Working Class in England in 1844, MECW, Vol. 27, p. 263. Marx & Engels’ Studies of Crisies, 1843−1895 53 body than in its heart, since the possibility of adjustment is greater here than there.112 The return of prosperity to England, they went on to show, was soon followed by the defeat of the revolutions and the spread of prosperity to the Continent in its turn – lagging in recovery as in crisis. Faced with this widespread recovery during the summer of 1850, Marx and Engels were forced to conclude that this development would undermine any quick return of a revolutionary situation. At the same time, they began to look at the European situation within the framework of their analysis of the contradiction between the forces of production and forms of social intercourse. They began to think that ­perhaps the development of the forces was not as advanced as they had previously thought — that there was still room for further development before the crisis. The new soberness in their assessment of the situation was accompanied by the conviction that crisis must eventually return and through it the revolution. With this general prosperity, in which the productive forces of bourgeois society develop as luxuriantly as is at all possible within bourgeois relationships, there can be no talk of revolution. Such a revolution is only possible in the periods when both these factors, the modern productive forces and the bourgeois forms of production, come in collision with each other … A new revolution is possible only in consequence of a new crisis. It is, however, just as certain as this crisis.113 The upshot of this analysis was the conviction on the part of Marx and Engels that the revolutionary possibilities, which they had expected to re-emerge soon, would be much longer in coming. They gave reasons in the Review to think that a crisis might recur as early as 1852, but they apparently did not put much faith in this prediction. They were soon embroiled in political infighting within the Communist League over the proper course of action. The change in their views was evidenced in their opposition to others who desired to continue to organize as if a new revolutionary surge was imminent. As a result of this conflict, the League split. With the continuing success of reaction on the continent, especially the successful destruction by Prussian police 112 113 Karl Marx, “Class Struggles in France,” January – November 1, 1850, MECW, Vol. 10, p. 134. Ibid., p. 135. 54 chapter 2 of the League’s organization in Germany in 1851, Marx and Engels decided to officially terminate the organization in 1852.114 This brought to a close their active participation in the political struggles of the period, as they both turned to research, writing, and making a living. For the next decade they would think, study and write in more or less complete isolation from active political movement. In this, they were not simply abandoning the field of action, but following the only realistic course open to them in the light of the defeat suffered by the working classes in England and Europe, and their belief that major political movement would only be generated by another round of major crises. Their return to research was part of the general movement of the working class in this period to relinquish the initiative in the class struggle and heal its wounds in preparation for struggles to come. It was during this long decade of relative working-class quiescence that Marx was able to return to his studies of political economy and work on the development of the basic theoretical framework necessary to a more precise understanding of the class relations of capitalism. Here he went back to the early efforts of Engels’ “Outline” and of his own Poverty of Philosophy to critique the categories and theories of political economy and construct a meaningful and consistent analysis of capitalism as a social system. It was during this period that his conceptualization of how the labor theory of value could be used as the key to a quantitative and qualitative analysis of capitalist relations took shape. This was a work of many years for Marx and interspersed with his job as a journalist for the New York Herald and other papers, all carried out under conditions of much personal poverty and ill health. When the crisis of 1851−52, which Marx and Engels had predicted, finally arrived, it was of considerably less amplitude—a “minor trade crisis”—and was accompanied by no significant resurgence of working-class struggle. In the continuing atmosphere of industrial prosperity and the rapid growth of European capitalism, which characterized the next five or six years, Marx and Engels carried on their solitary efforts. It was only slowly that they came to recognize that the crisis of the late 1840s was not a prelude to a final massive upheaval of capital and the revolution that they had expected, but rather a prelude to a long period of capitalist expansion. “The revival of trade, after the crisis of 1847,” Engels would later write “was the dawn of a new industrial epoch.”115 114 115 Biographers debate whether Marx officially dissolved the Communist League, or it just fell apart. David McClellan, for example, suggests “It seems probable that Marx exercised the power granted him in Brussels . . . to declare a formal dissolution . . .,” McClellan, Karl Marx: A Biography, 183. “Preface,” op. cit., MECW, Vol. 27, p. 258. Marx & Engels’ Studies of Crisies, 1843−1895 2 55 Years of Theory, 1857−1867 The first few years of the 1850s, after the split in the Communist League, were politically quiet ones for Marx. His endless studies in the British Museum, reading, copying excerpts, and making notes, were interrupted only by his work as a journalist. Those studies bore theoretical fruit in 1857 when the outbreak of a major crisis provoked him to pull his thoughts together. Despite the crisis causing the New-York [Daily] Tribune to reduce his already low payments by half, making his financial situation even more dismal,116 he was nevertheless excited by the revolutionary potential of a crisis he had been anticipating since the beginning of the decade. “Though my own financial distress may be dire indeed, never, since 1849, have I felt as cozy as during this outbreak,” he wrote to Engels.117 2.1 From Notes to Weighty Tomes In a tremendous burst of energy Marx worked night after night for months, pulling together his notes and synthesizing the new ideas that he had been developing over the past several years. As he wrote to Engels, “I am working like mad all night and every night collating my economic studies so that I at least get the outlines clear before the déluge.” The déluge was an expected revolutionary upheaval – such as the Revolutions of 1848, which had followed the crisis of 1847.118 The result was a series of notebooks – published long after his death as the Grundrisse,119 which many consider not only the first moment in the production of Marx’s so-called “mature” works, but also the first “draft” of what would become Capital.120 Although unpolished, they embodied a tremendous leap 116 117 118 119 120 Franz Mehring, Karl Marx, The Story of His Life (Ann Arbor: University of Michigan Press, 1918, 1962), Chap 9, 255. Mehring uses the title New York Tribune, which was correct except for the years from 1842 to 1866 when it bore the title New-York Daily Tribune. Marx to Engels, November 13, 1857, MECW, Vol. 40, p. 199. Marx to Engels, December 8, 1857, MECW, Vol. 40, p. 217. The Grundrisse der Kritik der Politischen Ökonomie, or Fundamentals (or Outlines) of the Critique of Political Economy, remained unpublished in full in German until 1939−41 and in English until 1973. This is the position of the editors of MECW, who sometimes call it “the original rough version of Capital.” See Vol. 28, p. XI, and sometimes “the first version of Capital,” Vol. 30, p. X, of Enrique Dussell in his “The Four Drafts of Capital: Towards a New Interpretation of the Dialectical Thought of Marx,” Rethinking Marxism 13, no. 1 (2001): 10−26 and of Fred Moseley in his Introduction to Marx’s Economic Manuscript of 1864−1865. It was not the position of either David McLellan or Antonio Negri who saw in the Grundrisse manuscripts a much greater synthesis of ideas only some of which would eventually appear 56 chapter 2 forward in Marx’s theoretical work. Despite his excitement and fervent wish, the crisis of 1857 did not result in another explosion of revolutionary activity, neither in England nor on the Continent, as had happened in 1848. In that absence, Marx continued his theoretical efforts. To polish, sharpen, reorganize, and clarify in his own mind and for publication, Marx repeatedly reworked the ideas in these notebooks in three more manuscripts leading up to Capital. The first, which he published in German in 1859, was his Zur Kritik der Politischen Ökonomie, or A Contribution to the Critique of Political Economy – largely a rewrite of the first part of the Grundrisse, which dealt with value and money.121 The second, intended as a continuation of Zur Kritik was the huge “Manuscript of 1861−63” – comprised of 23 notebooks and 1,472 pages.122 The entire manuscript has only recently become available in English in MECW (Vols 30−34), published from 1988 to 1994.123 The third was the “Manuscript of 1864−65,” supposedly a complete draft of Capital, although the part corresponding to Volume 1 has been lost. The parts containing the material which Engels prepared as Volumes 2 and 3 have just recently been published in English.124 All these texts contain analyses of the possibilities of crisis and various forces at work tending to bring them about.125 121 122 123 124 125 in Capital. See McLellan’s Karl Marx: A Biography (1973), pp. 275−284 and Negri’s much more elaborated interpretation in his Marx Oltre Marx: Quaderno di Lavoro sui Grundrisse (Milano: Feltrinelli, 1979). In English as: Marx Beyond Marx, Lessons on the Grundrisse (New York: Autonomedia, 1991). Zur Kritik was published in Berlin in June 1859. An English translation by N. I. Stone was published in English by Charles Kerr & Co. in Chicago in 1904. A different translation by Salo Ryazanskaya was published in 1970 by the troika of Progress Publishers in Moscow, Lawrence Wishart in London and International Publishers in New York. That translation was also the basis of the one provided in MECW, Vol. 29, pp. 257−417. A big chunk of the manuscript would be edited by Karl Kautsky (1854−1938) and published in three volumes as Theories of Surplus Value. That material was re-edited and translated into English and the three volumes were published sequentially by Progress Publishers (Moscow) as Theories of Surplus Value: Volume 4 of Capital, Pt. I in 1963, Pt. II in 1968 and Pt. III in 1971. The “Manuscript of 1861−63” was published for the first time, in German, in the MEGA in 1976−82. The section corresponding to Vol. II of Capital was published in German in MEGA in 1988 and the rest was published in 1992. The first English translation was published as Marx’s Economic Manuscript of 1864−1865, (Brill, 2015, Haymarket Books, 2017). The chronology is from Fred Moseley’s introduction. The availability in 2015 of an English translation of the original Manuscript of 1864−1865, out of which Engels crafted Volume 3, now makes it possible for those of us without knowledge of German to compare the original manuscript with Engel’s edited version. Unfortunately, the editor – Fred Mosely – by only linking the new translation to MEGA and not to the Penguin edition of Volume 3, which is the version most easily available, Marx & Engels’ Studies of Crisies, 1843−1895 57 All this work of theoretical thinking and writing elaborated a whole series of concepts in an increasingly clarified manner. This allowed Marx and Engels to dissect a wide variety of phenomena they had been studying in the development of the class struggle more clearly than ever before. As sketched below in Chapters 3−8, these concepts allowed them both to more clearly grasp the conditions of capitalist development and to analyze those conditions, both their realization and their crises, in terms of the ongoing struggle between workers and their exploiters. Devoted to thinking through these things with the ever-present goal of helping workers both understand what their class enemies were up to and their possibilities of rupturing those plans, their theories were unclassifiable in terms of contemporary scholarly “disciplines.” Yes, they studied some philosophers and drew upon some of their concepts to enrich their own insights, yet they were not philosophers, per se. Yes, they studied the political economists of their time – ever apologists, strategists and tacticians for capital – but they were not political economists, much less the even more narrowly focused economists of the twentieth century and today. So, reading their theory as philosophy or as an alternative economic theory of capitalism fails to see how they drew upon every theoretical effort they found useful to understand has made finding a familiar passage from Volume 3 within the Manuscript a tedious, time-consuming business. Similarly, because he bracketed the material Engels left out merely with the karats > and <, I highly recommend reading the text with a highlighter to more clearly identify those words and passages. The earlier publication of the manuscript in German gave rise to considerable debate among Marxologists about the importance of what Engels included, what he left out and what he changed, and the importance of the differences. See for example: Martha Campbell and Geert Reuten, eds., The Culmination of Capital: Essays on Volume III of Marx’s Capital (New York: Palgrave, 2002). Unfortunately, the theoretical perspectives of those engaged in the debates and their resulting preoccupations are so different from my own as to make most of the debate irrelevant to this project. The same situation obtains with regard to similar volumes written in reaction to the availability of original manuscripts which Marx wrote in crafting Volume 1 and from which Engels extracted and compiled Volume 2, e.g., Riccardo Bellofiore and Roberto Fineschi, eds., Re-reading Marx: New Perspectives after the Critical Edition (New York: Palgrave, 2019), Michael Heinrich, How to Read Marx’s Capital: Commentary and Explanations on the Beginning Chapters (New York: Monthly Review Press, 2021), Fred Moseley, Marx’s Theory of Value in Chapter I of Capital: A Critique of Heinrich’s Value-Form Interpretation (Palgrave Macmillan, 2023), Christopher Arthur and Geert Reuten. eds., The Circulation of Capital: Essays on Volume Two of Marx’s Capital (London: Macmillan Press, 1998). To the degree that I have found any of this new source material useful in clarifying Marx and Engels’ thinking on crisis beyond the material in the Penguin editions of Volumes 1 - 3, I have included references and appropriate footnotes. 58 chapter 2 capitalism and get beyond it – from philosophy and political economy through the kinds of approaches that today are classified as sociological, or anthropological, or political science or radical critical social theories, e.g., those of the radical social critics of their time, utopian socialists like Robert Owen, Charles Fourier or Saint Simon and anarchists such as Proudhon and Bakunin. They even drew inspiration from the analyses of the scientists of their day who were developing new theories and understanding of mathematics, thermodynamics, chemistry, and biology both in the abstract and in application to industry, in both commodity production and consumption. They examined not only how things were made but also the consequences of industrial processes for the safety or dangers of the commodities produced. One example: adulteration of foods, which sometimes merely lessened their nutritional value and sometimes made them quite poisonous to their consumers.126 Another result of their theoretical development was to facilitate recognition of how many phenomena, often seen as exogenous factors (intervening from the “outside,”) could be grasped as quite internal to the overall dynamics of the class struggles of capitalism. To take just a couple of examples, both “natural disasters,” such as epidemics or pandemics or floods or droughts, and wars, ranging from those between nation states through civil wars and colonial conquest, not only turn out to be moments of the more general class war constituted by ever-present struggles between workers and capitalists but also to play quite contradictory roles. For example, those “natural disasters” may cause crises in various moments of capitalist reproduction but how capitalist policy makers respond may turn them into weapons against workers aimed at counteracting workers’ struggles. Wars, say between nation states, may cause crises in some moments of capitalist reproduction, e.g., cutting off trade, killing off workers drafted into military service (mostly working-class men), but those conflicts may also include surges in investment and production, deployed in such a way as to counter worker struggles at home. Or, however, “productive” a war may initially appear, in terms of one national government seizing territory and resources, stimulating growth and providing a “nationalist” excuse to repress dissent at home, its negative effects on workers, both within the armed forces and in civilian life may be so great as to trigger a revolutionary uprising 126 With bread being the most basic consumption commodity of European workers in those days, it was fitting that Marx focused on how capitalists adulterated bread to cut costs and maximize profits, reducing its nutritional value to workers. See his discussion in Chapter 10, Section 3 of Volume 1 of Capital. Such practices continue to this day, despite the rise of workers’ awareness of such practices and the formation of specialized groups dedicated to ferreting out and exposing them, e.g., the private, non-profit Consumer Reports, founded in 1936, and government agencies such as the Food and Drug Administration. Marx & Engels’ Studies of Crisies, 1843−1895 59 disrupting capitalist accumulation far more than the war itself.127 Marx and Engels recognized these contradictory aspects and analyzed them in the different stages of activity which capitalists must realize in order to reproduce their system on an expanded scale.128 By the time the first volume of Capital appeared in 1867, Marx and Engels had re-entered the political arena. 2.2 The First International (1864–1876) Their return to active political life came after a decade (1852−62) of rapid capitalist expansion, a multiplication of the industrial proletariat and a resurgence of workers’ struggles that included the formation in 1864 of the International Working Men’s Association (the First International). This Association was initially formed by an assortment of British unionists, Owenites, French workers, Proudhonists and even a professor or two. They were all men and aimed at coordinating activities in supporting strikes and preventing the international use of 127 128 This was clearly the case when the Franco-Prussian War (1870−71) triggered the revolutionary rising that created the Paris Commune. (See below) A more recent and wellknown example was the Russian revolution in 1917 – partly spurred by the effects of Czarist participation in WWI. Both Marx and Engels grew up in a nineteenth century plagued by all kinds of war. Some examples: wars among pre-capitalist groups, e.g., the Ashanti-Akim-Akwapim War in West Africa (1814−16), wars of colonial conquest e.g., the First Anglo-Ashanti war in the Gold Coast (1823−31), the First Anglo-Burmese War (1824−26) in South Asia, the French conquest of Algeria (1830−1903), national liberation from colonialism, e.g., the wars of independence in South America (Brazil 1820−22), in Southeast Asia (Java War 1825−30) and in the Caribbean (Haitian Revolution 1791−1804, the Cuban War of Independence 1895−1898), civil wars, some short, e.g., the June Uprising in France (1848), some long, the American Civil War (1861−65), the First Central American Civil War (1826−29), wars among the major European powers, e.g., the Crimean War (1853−56) and revolutions, e.g., the July Revolution in France (1830), and, of course, the Revolutions of 1848 in which both Marx and Engels took part in Germany. Marx was born two years before the end of the Napoleonic Wars in 1815, which were soon followed by wars of liberation e.g., of Greece against the Ottoman Empire (1821−32). Engels, born two years later, received military training in the Prussia Army shortly before he met Marx in 1842. Although he attended some university classes, and reportedly preferred beer hall debates among Young Hegelians to the parade ground, something stuck such that over the years he contributed more to the study and writing about war than his more university-educated comrade. See, Tristram Hunt, The Frock-Coated Communist: The Life and Times of the Original Champagne Socialist (New York: Penguin Books, 2009). For both, however, wars constituted crises in structures of social power, increasingly of capitalist power to structure the world according to its own rules. 60 chapter 2 scab labor.129 Marx and Engels were invited to join the Association and quickly moved to prominence. Marx wound up preparing the final versions of the Inaugural Address and Provisional Rules – not easy given the conflicts among the different groups of workers involved: British Chartists, French Proudhonists, Italian Mazzinites, and so forth. Indeed, Giuseppe Mazzini (1805−1872), whose followers had prepared the first draft of the Inaugural address, was furious at Marx’s rewrite.130 In that address, despite acknowledging some success in extending the scope of the 1847 Ten Hours’ Bill and the creation of some industrial cooperatives, Marx recapped the history of class struggle since the defeats of 1848 emphasizing the contradiction between industrial growth and persistent poverty, periodically worsened by “the quickened return, the widening compass, and the deadlier effects of the social pest called a commercial and industrial crisis.”131 The objective of the International, at least from Marx and Engels’ point of view, was stated cleanly by the latter, years later: “Its aim was to weld together into one huge army the whole militant working class of Europe and America.”132 Once the International was launched, Marx and Engels set to work, as they had in the Communist League, spreading their own views among the membership and critiquing opposing tendencies. Although the organization had been founded on the principle of organizing across borders and there was general agreement to demand a universal working day of eight hours (adopted at their congress in Geneva in 1868), there were also important disagreements. One concerned the wisdom of struggles to increase, or prevent the decrease, of wages. It was within this debate that Marx delivered the two lectures that were later published as Value, Price and Profit.133 These lectures, which set out in capsule form the theory and arguments that would appear in Capital two years later, were written during the “real epidemic of strikes, and a general 129 130 131 132 133 The all-male character of the organization was challenged by Harriet Law (1831−1897), a prominent secularist and feminist speaker who wrote a letter to the organization on women’s rights. As a result, she was asked to join the General Council of the International. Although she played a role for five years, she remained the sole woman on the Council. McLellan, Karl Marx: A Biography, 347. MECW, Vol. 20, pp. 10−11. Frederick Engels, “Preface to the Fourth German Edition of the Manifesto,” London, May 1, 1890, MECW, Vol. 27, p. 58. In this Preface Engels goes on to explain how that couldn’t happen at that time. But in 1890, the birth of the Second International encouraged him to write, optimistically, “today, as I write these lines, the European and American proletariat is reviewing its fighting forces, mobilized for the first time, mobilized as one army, under one flag, for one immediate aim: the standard eight-hour working day to be established by legal enactment ... today the working men of all countries are united indeed.,” p. 60. MECW, Vol. 20, pp. 101–149. Marx & Engels’ Studies of Crisies, 1843−1895 61 clamor for a rise of wages,” that swept Europe shortly before the crash of 1866. Their political purpose was to refute the arguments of another member of the International, the Owenite John Weston, who had argued that workers should abandon wage struggles because inflation and recession would always undermine any gains made. Marx vehemently attacked this position arguing that it would have disastrous economic and political consequences for the working class. Drawing on his studies of crises, he argued that while it was true that crises would limit the gains workers could make, their situation would be even worse without those struggles. Basically, he was repeating the arguments Engels had used a decade earlier in his Condition of the Working Class in England. Wages (the price of labor-power) fluctuate over the course of business expansions and crises like the prices of other commodities. But, Marx argued, precisely because capitalists tend to get away with reducing wages during crises, – by laying off workers – it is important that workers struggle to force them up during periods of expansion: If during the phases of prosperity, when extra profits are made, he did not battle for a rise of wages, he [the worker] would, taking the average of one industrial cycle, not even receive his average wages, or the value of his labour[-power]. It is the utmost height of folly to demand that while his wages are necessarily affected by the adverse phases of the cycle, he should exclude himself from compensation during the prosperous phases of the cycle.134 Marx’s advocacy that the International strongly support workers’ wage struggles was based not only on the need of workers to protect their average income, but again, like Engels before him, he also saw those struggles as constituting indispensable opportunities for the workers to organize themselves as a class, a preparation necessary to the ultimate overthrow of the system as a whole: By cowardly giving way in their every-day conflict with capital, they would certainly disqualify themselves for the initiating of any larger movement.135 These lectures, it must be remembered, were written toward the end of Marx’s vast work on Capital and thus founded its politics on that basis. Although in 134 135 Ibid., p. 143. Ibid., p. 148. 62 chapter 2 these writings, he did not bring in the many causes of crisis136 explored in his theoretical writings, he maintained the same overall political conclusions and strategies that he had held in the earlier period of the 1840s. He again supported wage struggles as a necessary step in working-class development and as a prelude to the abolition of the wage system itself, i.e., the revolutionary overthrow of capital. 3 After Capital, 1867−1895 I date this third and last period of Marx and Engels’ writings from the first publication of Volume 1 of Capital in September 1867 through Marx’s death in March 1883 to Engels’, twelve years later in August 1895. Despite his last years being plagued with poor health and the all-too-­ frequent deaths of both children and grandchildren, which frequently interrupted his efforts to write, Marx did manage to turn out a number of important contributions. They included 1) his analysis of the Franco-Prussian war and the Paris Commune, 2) his revisions of Volume 1 of Capital, 3) his commentaries on political developments and conflicts in the budding socialist political movement, e.g., Critique of the Gotha Programme (1875), 4) his program for the deep study of the workplace, i.e., A Workers’ Inquiry (1880), and 5) his conclusions from his study of pre-capitalist societies and of Russia, e.g., his letters to Zasulich (1881). For Engels, his most substantial writings during this period were, 1) his critique of Dühring on science and economics: Anti-Dühring (1878), 2) his main effort to popularize their ideas: Socialism: Utopian and Scientific (1880), 3) his re-do of Hegel’s comprehensive view of dialectics: The Dialectics of Nature (1883), 4) his exploration of some hitherto undeveloped themes: The Origin of the Family, Private Property and the State (1884), 5) his recap of German philosophy: Ludwig Feuerbach and the End of Classical German Philosophy (1886) and 6) his work sorting, sifting and organizing Marx’s manuscripts into Volume 2 (1885) and Volume 3 (1894) of Capital. These last thirty years were ones of many sorts of crises: wars, financial panics, epidemics, worker strikes and popular uprisings all ruptured accumulation, both at home and abroad. The renewed colonial expansion by capitalists seeking profitable sources of cheap labor, raw materials and markets in Asia, Africa, and Oceania and by the US government in the Western territories all caused 136 On the other hand, in Chapter 5 of this book, I explore those causes and in Chapter 6 those countervailing forces he identified. Marx & Engels’ Studies of Crisies, 1843−1895 63 crises for the indigenous populations – who repeatedly fought back, rupturing and delaying plans of conquest. Finally, capitalist states warred among themselves both disrupting and, like colonialism, providing new opportunities for investment and profit making. Throughout this period, Marx and Engels continued to follow and analyze these events and their relation to workers’ struggles both at home and abroad. Always with the primary aim of influencing the evolving forms and content of workers’ political self-organization, they continued both to publish the results of their research and to intervene directly in debates about the best ways for workers to proceed. 3.1 A New Terrain of Struggle: Electoral Politics The year 1867 was an important one – not only because the first volume of Capital came off the presses, but also because of two other events. The first was the financial crisis of 1866−67. Marx closely followed the crisis, as with those in 1847 and 1857, filling several notebooks with information and reflections – despite being preoccupied with getting the manuscript and proof sheets of Capital to the printer.137 The second was the passage of the Reform Act of 1867 by the British Parliament – prompted by mass demonstrations against the rising unemployment and falling wages caused by the crisis. The Act profoundly changed the dynamics of class struggle within Britain by allowing at least some propertyless workers to participate in elections. Although the Chartist Movement and its demand for the enfranchisement of workers had long faded from the scene, two new organizations had been carrying on the struggle for working class suffrage: the Reform Union, founded in 1864, and the Reform League, founded in 1865. The League, created by ­middle class radicals and workers associated with the First International, was supported by Marx.138 It was partly through their efforts, mobilizing hundreds of thousands of workers in huge public meetings, that the enfranchisement of many adult male workers was achieved with the passage of a new Reform Act in 1867. Although the short-term effects merely tilted elections in favor of Liberals against Conservatives, the more profound and long-lasting effect – especially after the Ballot Act of 1872 that made ballots secret, and thus safer for workers who voted against the wishes of their employers – was to open a new political option for workers’ struggles that would lead to the rise of social democratic 137 138 It was too late for him to incorporate all this into the first volume of Capital but not for Engels to eventually incorporate some of it into his preparation of Volume 3 (see below). “The great achievement of the ‘International Association’ is this: The Reform League,” Marx wrote to Engels, “is our doing.” Marx to Engels, May 3, 1865, MECW, Vol. 42, p. 150. 64 chapter 2 political parties. This changed the formal sphere of electoral politics from being an object out of reach of workers, something to be pressured from the outside, into a new terrain of struggle, first to get candidates elected who represented workers’ interests and second, to draft and fight for new laws beneficial to workers.139 The appeal of these new parties lay not only in being vehicles to struggle for laws benefiting workers but also in their apparent potential for a peaceful transition out of capitalism. It was this potential that led Marx, according to Engels, to believe that “England is the only country where the inevitable social revolution might be effected entirely by peaceful and legal means.”140 This access to direct influence on legislation was an objective for which Marx & Engels had fought back in Germany, by supporting liberal demands for royal power to accept the formation of a parliament based on elections. Then, upon the failure of those efforts, they joined the rising of 1848 to force such a change. The eventual formation by Frederick William IV of a bicameral parliament, with the lower house made up of elected representatives, was similar to the English Parliament but with voting based on the amount of taxes paid rather than property as such. In both cases, workers were excluded. The success, in England, of workers finally winning participation in elections meant, inevitably, the formation of formally institutionalized political parties claiming to represent the interests of workers through electoral politics. Marx and Engels’ political activities drew them progressively into debates over the programs of such parties and into debates over whether those programs would either facilitate or hinder transitioning beyond capitalism. 3.2 Continuing Conflicts within the First International In the years immediately following all these events, Marx and Engels’ political activities were preoccupied with trying to build the First International, an organization created, not to contest elections but to unite the struggles of 139 140 Over time, it would become apparent that the same dynamics of outside pressure, which had previously forced the passage of the Factory Acts and then these acts giving some workers the vote, would be the primary source of power for their elected representatives. While their representatives within governments found a new public platform for articulating worker demands, it has been recurrent mass movements outside the electoral arena that have provided those representatives with leverage to achieve changes benefiting workers. Engels, “Preface to the English Edition” (November 5, 1886) in Capital, Vol. 1, p. 113, or MECW Vol. 35, p. 36. Least this be misinterpreted as overly optimistic, Engels also added “He certainly never forgot to add that he hardly expected the English ruling classes to submit, without a ‘pro-slavery rebellion’, to this peaceful and legal revolution.” Marx & Engels’ Studies of Crisies, 1843−1895 65 workers across borders. Their efforts to expand various national sections and coordinate among them included, inevitably, setting forth their own views and their critiques of others’ ideas. For example, Marx and Engels disagreed with the Proudhonists over a variety of issues. The one closest to my concern with crisis was the Proudhonists’ idea that reforming the financial system – where speculation and instability constituted important sources of crisis – could pave the path to transcending capitalism. Back in 1857, Marx had begun the Grundrisse notebooks with an attack on the Proudonist Alfred Darimon (1819−1902) and just that idea. While their proposal remained essentially the same, Marx’s study of the financial sector and of financial crises, which made up a large part of his Economic Manuscript of 1864−1865 and would eventually be published as part of Volume 3 of Capital, confirmed his critique of such Proudhonist projects as futile and the conflict was fought out both between and during the International’s various Congresses. In the case of the anarchist Mikhail Bakunin (1814−1876), Engels and Marx’s attitudes varied, from praise to condemnation. In the wake of the 1848−49 revolution in Germany, Engels praised Bakunin’s role in an uprising in Dresden. “The working men … found an able and cool-headed commander in the R ­ ussian refugee Michael Bakunin …”141 In 1864, Marx met with Bakunin and invited him to join the First International, remarking to Engels, “Bakunin sends his regards … I saw him yesterday for the first time in 16 years. I must say I liked him very much, more so than previously … On the whole, he is one of the few people whom after 16 years I find to have moved forwards and not backwards.”142 Bakunin, for his part, recognized how Marx and Engels had delved into “political economy” far more profoundly than he had, writing “Marx was, and still is, incomparably more advanced than I … I greatly respected him for his learning and for his passionate devotion … to the cause of the proletariat.”143 Indeed, 141 142 143 Frederick Engels, “Revolution and Counter-Revolution in Germany: XVIII: Petty Traders,” New-York Daily Tribune, No. 3576, October 2, 1852, MECW, Vol. 11, p. 90. Because the Tribune attributed the authorship of this series of articles to Marx, they appeared under his name. Engels’ authorship was only discovered in 1913 in correspondence between himself and Marx. It was therefore unknown to James Guillaume (1844−1916) whose 1907 biographical sketch of Bakunin (in Volume 2 of the French edition of the six volumes of Bakunin’s Oeuvres) is included in Sam Dolgoff, ed., Bakunin on Anarchism (Montreal: Black Rose Books, 1980). Marx to Engels, November 4, 1864, MECW, Vol. 42, pp. 18−19. Quoted by Guillaume in his Biographical Sketch of Bakunin in Dolgoff, p. 25. 66 chapter 2 despite subsequent differences, he found Marx’s analysis of capitalism so useful that he went so far as to begin translating Capital into Russian in 1869.144 Those differences, however, made a split inevitable. Unlike their differences with Proudhon over finance within capitalist development and crisis, those with Bakunin primarily concerned political strategy. Although Bakunin became a member of the Geneva section of the First International in 1868, he fought all of Marx and Engels’ efforts to achieve unity of principle and action among its various sections. Demanding only agreement on the principle of cross-border solidarity for membership in the International, he advocated instead for autonomy of ideas and actions. For him, the class struggle was real but simple: capitalists exploit, workers resist. And because the state (mainly the government) is controlled by capitalists and wields its armed might against workers, the only reasonable objective of class struggle is the overthrow of the state. As a result, Bakunin rejected Marx and Engels’ embrace of workers’ struggles for democracy, access to the vote and the possibility of influencing government policy on their behalf, e.g., the Factory Acts or laws against child labor, objectives long sought by workers. For Bakunin, such participation by workers in the formal political system, designed and structured by capitalists, was a trap, one that would inevitably result in the diversion of energy for revolution into negotiations with capitalists over changes that would not challenge the system as a whole. So, whereas Marx and Engels saw the Reform Act of 1867 opening a new terrain for workers’ struggles, on which they could win victories that would increase their ability to struggle further, Bakunin saw only a hapless illusion.145 The vociferousness with which each came to attack the other 144 145 Diverted by Sergey Nechayev (1847−1882) into participation in organizing in Russia, Bakunin abandoned his translating, and the task was taken up first by Lopatin and then by Danielson (see below). Just how much of Capital Bakunin actually studied, I have been unable to determine. To date I have found no writings of his reflecting on Marx’s theories of crisis, nor its relation to class struggle. For Bakunin’s views on his differences with Marx and Engels see his essay “The International and Karl Marx” (1872) in Dolgoff, op. cit., pp. 286−320. The subsequent history of social democratic parties’ participation in electoral politics has demonstrated precisely the contradictory forces that Marx and Bakunin debated. While those parties have sometimes facilitated workers winning some protections and rights, they have also often replaced revolutionary aims with reformist ones, which have strengthened rather than undermined capitalism. The result has been the repeated formation of movements and groups with more revolutionary goals acting autonomously from and often against the programs of “official” working class parties and labor unions. Besides the United States which saw in the 1960s the rise of Civil Rights, New Left and Black Power movements, all of which operated outside existing political parties, another country in which such autonomous grassroots activity has been well-documented is Italy, where the collabo­ ration of the supposedly pro-worker Communist Party of Italy (CPI) with Post-WWII Marx & Engels’ Studies of Crisies, 1843−1895 67 has continued to divide many anarchists and Marxists ever since. Bakunin was finally expelled from the International in 1872. 3.3 War and the Paris Commune These conflicts unfolded within the context of an ongoing series of crises and revolts in Europe, the first of which to draw Marx and Engel’s close attention was the onset of the Franco-Prussian War (July 19, 1870 to January 28, 1871) and one of its unforeseen consequences: the Paris Commune (1871).146 When France, under the rule of French Emperor Napoleon III declared war and invaded Germany, Marx, Engels, the International’s General Council and its sections in both France and Germany condemned it. The war, they argued, was one between ruling elites, in which workers qua soldiers were pitted against each other on the battlefield, while being repressed at home; only the ruling class of one side or another would benefit. The International’s First Address about the war, drafted by Marx at the direction of the General Council, not only blasted Napoleon’s aggression but also pointed out his practice of using war abroad to attack workers at home, including their organizations, such as the International.147 The International’s sections in France had opposed Napoleon’s “plebiscite” – designed to demonstrate popular support for his policies – and issued a manifesto against the war, which led directly to arrests of members. Nor did Marx judge Napoleon alone in his desire to use foreign wars to justify repression at home. He also condemned Prussian chancellor Otto Von Bismarck (1815−1898) who had, during the Austro-Prussian War (1866), “conspired with that very same Louis 146 147 capitalist development provoked the rise of a substantial “extra-parliamentary” movement. It both critiqued that collaboration and organized rank & file worker struggles against the subordination of their needs to capitalist development. More recently, the indigenous Zapatista movement in Chiapas, Mexico, arising outside the existing political party politics of that country, has refused to be suborned to either the “leftist” Partido de la Revolución Democrática or, more recently, to its one-time candidate but now President Andrés Manuel López Obrador (1953-). They have, instead, pursued collaboration with other indigenous and autonomous movements both within Mexico and around the world. Another fruit of the war was the unification of Germany under Prussian leadership. ­Bismarck began the war leading the North German Confederation, formed in 1867, but by its end had drawn in several South German states and in 1871 formed a unified German Empire. K. Marx, “To the Members of the International Working Men’s Association in Europe and the United States,” MECW, Vol. 22, p. 3. This usage of foreign wars for conquest of new land, new resources and potential workers included colonialism, in which ­Napoleon indulged freely, expanding the French empire in places such as New Caledonia, Cochinchina, and Africa. 68 chapter 2 Bonaparte for the purpose of crushing popular opposition at home.” In both cases, war formed a crisis for workers, both on the battlefield and on the home front.148 The Address condemned the war as aimed at increasing Napoleon’s power in Europe as well as “a source of fresh speculations.” This last charge was ­consistent with Marx’s analysis of the entire Second Empire (1852 – 1870) as fostering and propping up a capitalism run amuck, rife with stock jobbing and speculation. Following and analyzing the chaotic development of industry, finance and speculation in France was an important source for Marx’s analysis of capitalist crisis, much of which would eventually be included in Volume 3 of Capital by Engels pulling together Marx’s voluminous notes and material in the Manuscript of 1864−65. Sharing Marx’s condemnation of the capitalism of the Second Empire, Engels also portrayed the war as birthed by “a set of adventurers who turned administration, government, army, navy – in fact, all France – into a source of pecuniary profit to themselves.”149 Because Napoleon was the aggressor, the International initially, reluctantly, accepted the participation of German workers in the name of self-defense, but only so long as the conflict did not “degenerate into a war against the French people.”150 But as the coalition of German states, put together by Bismarck, not 148 149 150 This dual character of capitalist war continued into the twentieth century. A ­ merican involvement in WWI provided a pretext for anti-German and anti-immigrant propaganda that contributed to the Red Scare and wholesale repression of workers in the late teens and twenties. Anti-Japanese racism and internment during WWII echoed the anti-immigrant actions from WWI. After securing a no-strike pledge from workers during WWII, capitalists tried to use their quietude to increase their war profiteering at ­workers’ expense. See Martin Glaberman, Wartime Strikes: The Struggle Against the No-Strike Pledge in the UAW During W.W. II (Detroit: Bewick Editions, 1980). The racist vilification of the Vietnamese as “gooks,” etc., during the war on Vietnamese independence, made the lives of Vietnamese refugees in the US difficult after the loss of the war in 1975. Something similar is happening today with Muslim refugees from the US government’s wars in the Middle East (Gulf Wars I & II) and Central Asia (Afghanistan). MECW, Vol. 22, p. 77. The parallels with the Trump family of grifters could not be more obvious as not only Donald but Ivanka and Jared used their White House positions to enrich themselves. K. Marx, “To the Members of the International Working Men’s Association,” op. cit., MECW, Vol. 22, p. 6. One legacy of this support has been widespread Marxist opposition to all obviously aggressive wars, from those of colonial conquest, through World Wars I & II to more recent invasions of other countries, e.g., the Korean War, the French colonialist return to Vietnam after WWII followed by the US government’s neocolonial efforts to replace the French after their defeat, the Bush/Cheney invasions of Afghanistan and Iraq, and, most recently, the Russian invasion of the Ukraine. On the other hand, supposedly Marxist parties allied with the Soviet Union, largely turned a blind eye to its replacement of the Czarist empire with a new Soviet one and then its replacement of German control Marx & Engels’ Studies of Crisies, 1843−1895 69 only defeated the French army but then invaded France, that “degeneration” did take place and their opposition became much stronger.151 The capture of Napoleon and the defeat of his army led to the creation in Paris of a provisional Government of National Defence, its mobilization against the advancing German army and the announcement of a Third French Republic.152 As the German army fought its way across northern France winning battle after battle, its progress was followed closely by Engels. He wrote some 59 articles recounting and analyzing these military clashes, while also pointing out war profiteering among capitalists and how Napoleon had weakened his army by keeping troops in Paris – for the control of its workers.153 The German army’s advance ended with the surrounding and siege of Paris. The failure of the new government to break the siege, coupled with a revolutionary rising (crushed) led to its surrender and to the signing of a humiliating armistice and final treaty.154 That agreement disarmed the French army, ceded Alsace and Lorraine to the Germans and promised both indemnity and heavy reparations – to the tune of 5 billion francs.155 A new government was formed, with its seat outside of Paris at Versailles, which quickly passed new legislation to raise the funds necessary to pay the Germans and get them to withdraw from France. The costs of raising those funds fell heavily on the French people. Their reaction was outrage and uprisings in several French cities including Paris. The uprising in Paris led to Parisians not only forming their own government, separate from the one in Versailles, but also forming a 151 152 153 154 155 over Central Europe with its own domination and subsequent repression of local uprisings, such as those in East Germany in 1953, Hungary in 1956 and Czechoslovakia in 1968. This evolution can be seen in Marx’s two “Addresses” to the Central Council of the International. These, along with other documents tracing the activities of the International in various countries, can be found in MECW, Vol. 22. In one form or another the Third Republic would govern France until its defeat by the Nazis in 1940. During the last two decades of the nineteenth century, France under that government would expand what Napoleon III had called the Second French Empire into a much more extensive empire by creating new colonies in Indochina, Africa and the South Pacific. The 59 articles on the war written by Engels in 1870 and 1871, can be found in MECW, Vol. 22. Napoleon, Engels wrote, did not intend “to send the mass of the troops now in Paris to the front. Paris must be kept down.” “Notes on the War – X,” August 19, 1870, MECW, Vol. 22, p. 55. These were the Traité préliminaire de paix du 26 février 1871 and the Traité de Francfort. Traité préliminaire de paix, “ART. 2. - La France paiera à S.M. l’Empereur d’Allemagne la somme de 5 milliards de francs. Le paiement d’au moins 1 milliard de francs aura lieu dans le courant de l’année 1871, et celui de tout le reste de la dette dans un espace de trois années, à partir de la ratification des présentes.” 70 chapter 2 government of a new kind, an actually democratic one, which Marx and many others would celebrate as the first workers’ government in history – the Paris Commune. The Parisians were not alone; communes were declared in several cities. These included the short-lived Commune of Lyon, where Bakunin, then in the First International, was active and the Commune of Marseille. There was even a Commune in Algiers, capitol of the French colony of Algeria – a place to which many of the revolutionaries of 1848 had been deported. Unfortunately, THAT Commune, organized by settler-colonialists, did not link up with the near simultaneous indigenous Mokrani/Kabyle revolt against the French occupation of the country – not until surviving revolutionaries of both camps were packed off to the same prison island in New Caladonia. Although Marx and Engels celebrated the ethnic and national diversity of the Communards of Paris, as I noted in my “Note to Polish Readers” (below), it found its limits in the colonies.156 Marx and Engels, following these events from London, participated only indirectly through their First International contacts in Paris. Once the Commune was formed, they provided advice to those directly involved on the ground, while mobilizing solidarity with the Communards everywhere they could. Marx’s involvement was so well-known that he was attacked in newspapers – quite wrongly – as being the “eminence grise” behind the rising.157 The 156 157 See, Niklas Plaetzer, “Decolonizing the ‘Universal Republic’: The Paris Commune and the French Empire,” Nineteenth Century French Studies 49, nos. 3 & 4 (Spring-Summer 2021), 585−603. Upon the signing of this armistice, Napoleon and his entourage were released. Blamed for the war, its loss and the siege of Paris, with too little support in France for any hope of a comeback, he and his family went into exile in England where he died in 1873. Such efforts to blame – and often persecute – Marxist intellectuals for the actions of others can be seen as either a projection of ruling class modes of top-down structures of power onto opponents or as a merely convenient justification for the repression of outspoken critics. The absence of such leadership within horizontal rhizomes of distributed power and decision making hasn’t stopped capitalists from pretending top-down structures exist as part of more general repression. One notable example was the Italian government’s blaming – and attempt to arrest – Antonio Negri as the brains behind the Red Brigades in April 1979. Although Negri escaped to France, many other intellectuals were caught up in the governments’ dragnet to repress dissent – a repression actively pushed by the Italian Communist Party against its extra-parliamentary critics. In this case, Negri eventually returned to Italy, stood trial, and was exonerated of the charges. More recently, some of those who also escaped to France and have lived in exile for decades were arrested and deported by a more complicit Macron administration. On this latest case, see the interview with Enzo Traverso “On the Arrests of Italian Militants in France,” Verso Books Blog, June 25, 2021. https://www.versobooks.com/blogs/news/5115-on-the -arrests-of-italian-militants-in-france Marx & Engels’ Studies of Crisies, 1843−1895 71 International was also attacked, mostly based on lies cranked out by the French police and repeated uncritically in capitalist newspapers. He eventually laid out his analysis of the Commune in The Civil War in France (1871).158 Much of Marx’s analysis in that essay consists of identifying and lambasting those responsible for the war, for the selling out of France in defeat and for the crushing of the Commune, especially Adolphe Thiers who organized the massacre of the Communards and became President of the Republic.159 My interest here, however, is limited to what little he had to say about crisis. Unlike the revolutions of 1848, birthed in part by the crisis of 1847, the Commune was born in the midst of war, in a Paris surrounded by German troops – a crisis for sure but of a quite different kind. Within this context, his comments about crisis are of two sorts. The first concerns the economic situation faced by France and the Commune as a result of the policies of the Second Empire. The second concerns the steps taken by the Commune in the face of the situation in which it found itself. The war-as-crisis revealed another – dramatically worsened by the surrendering government granting massive reparations to the victorious­ ­ Germans – namely a fiscal crisis. That, Marx argued, was the inevitable result in a country bankrupted by years of speculation and ever-growing mountains of debt. Marx wrote about how under the sway of the Second Empire, “bourgeois society freed from political cares, attained a development unexpected even by itself. Its industry and commerce expanded to colossal dimensions, financial swindling celebrated cosmopolitan orgies, the misery of the masses was set off by a shameless display of gorgeous, meretricious and debased luxury,” 158 159 Another example was the attempt by the Mexican government to blame the 1994 indigenous uprising in Chiapas on its intellectual spokesperson Subcomandante Marcos, although it was actually an array of community councils which had ordered its Zapatista Army of National Liberation into action. The repression which followed was quite general and aimed at permanently crippling the ability of the Zapatista communities to resist exploitation. Whereas in Italy the government launched a police roundup of intellectuals, in Mexico it dispatched tens of thousands of army troops and, when that effort was stymied politically, it financed and armed paramilitary violence against the communities. K. Marx, “The Civil War in France,” MECW, Vol. 22, First Draft, pp. 437−514, Second Draft, pp. 515−551, Final, published version, pp. 307−355. This and similar historical essays provide antidotes to the common complaint that Marx’s use of the terms “capital” or “capitalists” to denote the class as a whole – as in Chapter 10 of Volume 1 on class struggles over the length of the working day – oversimplifies and wrongly depicts the class as a homogenous whole. They illustrate how while that practice is associated with analyzing overall trends, in his close examination of real historical moments Marx recognizes and analyzes the heterogeneity and internal conflicts within the capitalist class. His and Engels’ manifold analyses of the working class and of struggles between factions demonstrate the same differentiated approach. 72 chapter 2 this “rottenness … [was] laid bare by the bayonet of Prussia.”160 “The Second Empire had more than doubled the national debt and plunged the large towns into heavy municipal debts. The war had fearfully swelled the liabilities and mercilessly ravaged the resources of the nation.”161 For those who formed the Third Republic off at Versailles, the solution was obvious. In the short term: borrow, take on more debt, but as soon as possible shift the cost of the war and reparations from the “appropriators of wealth” to the “shoulders of the producers.” This had been done after the revolution of 1848, where concessions to workers were paid for by raising taxes on the peasantry – a ploy successful in turning the latter against the former. But to borrow, the Versailles government had to meet the demands of the bankers who insisted that before any new loans would be forthcoming, the Commune must be crushed. “Thus, the immense ruin of France spurred on these patriotic representatives of land and capital, under the very eyes and patronage of the invader, to graft upon the foreign war a civil war – a slaveholders’ rebellion.”162 True to their word, once the Commune was crushed, a new loan was forthcoming.163 This insistence by the bankers, agreed upon and executed by the Versailles government, derived not merely from a distaste for Parisians taking control of their own city, but from the policies being set forth by the Communards. Not only did the Commune declare that “the true originators of the war would be made to pay its cost,” but it also enacted a series of other measures which struck 160 161 162 163 “The Civil War in France,” MECW, Vol. 22, p. 330. Ibid., p. 319. Ibid., p.219, “No money was to be paid down until after the ‘pacification’ of Paris”, p. 320. Editors’ note, MECW, Vol. 22, p. 669, note 182. Similar were the demands of New York City banks in the mid-1970s as conditions for rolling over that city’s debt: cut welfare payments and cut the wages and benefits of city workers. See, Donna Demac & Philip Mattera, “Developing and Underdeveloping New York: The ‘Fiscal Crisis’ and the Imposition of Austerity”, Zerowork 2, (1977), 113−139. Under the same rubric of “austerity,” making workers and the poor pay became a central element in the conditions set by the International Monetary Fund for rolling over the debt of country after country during the international debt crisis of the 1980s and 1990s. See, H. Cleaver, “Close the IMF, Abolish Debt and End Development: a Class Analysis of the International Debt Crisis,” Capital & Class 39, (Vol. 13, Issue 3, Winter 1989): 17−50. Where resistance flared, the banks demanded more, as illustrated by the case of the Zapatista uprising in Chiapas, Mexico in 1994. In that case, just like the Parisian bankers who wanted the Commune crushed, Chase Manhattan Bank, in the person of Riordan Roett, writing for Chase investors in emerging markets, demanded the “elimination” of the Zapatistas. See Roett’s essay and the follow-up story by Counterpunch, which originally obtained and wrote about it, Ken Silverstein and Alexander Cockburn, “Chase Memo Tumult: Come Blow Our Horn,” Counterpunch 2, no. 4 (February 15, 1995): 3. Marx & Engels’ Studies of Crisies, 1843−1895 73 at the heart of capitalist power. These included: no prosecutions for delayed repayment of debt, the abolition of interest on debt, ending nightwork at bakeries, no more fines on waged workers, closed factories handed over to their workers, the suppression of the army – traditionally used to control workers and peasants as much as for foreign wars – and its replacement by arming the people, a parallel change in the police making it responsible to the people and a “revocable agent of the Commune,” public servants to be paid workers’ wages, magistrates and judges to be elected and revocable, secularization of science and education to be made free to all, the Commune form of government to be extended throughout the country, formed at each level through universal suffrage and revocable. In short, “the merely repressive organs of government were to be amputated, its legitimate functions were to be wrested from an authority usurping pre-eminence over society itself, and restored to the responsible agents of society.” “Yes, gentlemen,” Marx wrote, “the Commune intended to abolish the class-property which makes the labour of the many the wealth of the few. It aimed at the expropriation of the expropriator. It wanted to make individual property a truth by transforming the means of production, land and capital, now chiefly the means of enslaving and exploiting labour, into mere instruments of free and associated labour.”164 That reorganized, co-operative labor would put an end “to the constant anarchy and periodical convulsions which are the fatality of Capitalist production.”165 Of all this, Marx argued, the Commune only had time to take the first revolutionary steps towards replacing capitalism with communism. But in doing so it constituted a threat not only to bankers but to all capitalists. The great fear of capitalists and great hope of revolutionaries, that a capitalist crisis could be turned into the overthrow of the system and the building of an alternative seemed to be unfolding inside Paris. These were the things that excited Marx and terrified those at Versailles – provoking vicious massacres to put down the threat, the taking on of more debt. This last contributed to France suffering participation in a new banking crisis in 1873 and in the Trans-Atlantic depression of 1873−1896. 164 165 “The Civil War in France,” MECW, Vol. 22, 331−341. Despite these rhetorical flourishes that treat the Commune as a unified subject, both Marx’s essay and subsequent studies of the Commune have made clear that its existence and its evolution was the product of diverse, often conflicting interests – more united in what they no longer wanted than in the character of what would replace it. Marx was excited by what he saw, especially how universal suffrage would give great weight to the power of workers and peasants to determine that path and how those elected were subject to recall if they failed those who had elected them. But to what degree the Commune and its offspring would have followed the path to communism that Marx projected would never be known. Ibid., p. 335. 74 chapter 2 3.4 Revisions and Translations Despite the demands for keeping abreast of conflicts within the First ­International and analyzing workers’ struggles in England and abroad, Marx continued his theoretical work. He wanted to finish his promised second volume of Capital on the circulation of capital, a third on “the various forms of the process of capital in its totality” and a fourth on the history of the theory.166 All this he had already studied and spelled out in voluminous notebooks but not yet prepared for publication. His attempts to finish this work, however, were repeatedly interrupted, not only by ill health in his family,167 his involvement in politics and his efforts to keep up with various crises and revolts, but also by preoccupation with the second German edition of Capital and various translations of the book. His own dissatisfaction with the first edition led Marx to undertake some serious revisions in both structure and content in the Second German Edition. He indicates some of these in his 1873 Postface, especially his revisions of the analysis of value in the opening chapter where he combined the original with the supplemental material previously attached as an appendix. After reviewing critiques of the First Edition, after denouncing the descent of political economics from efforts to understand capitalism to efforts to apologize for it, and after analyzing the development of political economy in Germany, he ends the Postface by discussing the differences between his dialectical method and Hegel’s. He argues that capital itself, through its crises and recoveries will eventually teach doubters the reality of dialectics. The fact that the movement of capitalist society is full of contradictions impresses itself most strikingly on the practical bourgeois in the changes of the periodic cycle through which modern industry passes, the summit of which is the general crisis. That crisis is once again approaching, although as yet it is only in its preliminary stages, and by the universality of its field of action and the intensity of its impact it will drum dialectics even into the heads of the upstarts in charge of the new Holy Prussian-German Empire.168 166 167 168 Promised in his Preface to the first edition. Capital, Vol. 1, p. 93, or MECW, Vol. 35, p. 11. Ill-health would not only repeatedly prevent Marx himself from writing but would kill several members of his family including his wife Jenny who died of liver cancer in 1881. For an account of these tribulations see, Marcello Musto, The Last Years of Karl Marx: An Intellectual Biography, (Stanford: Stanford University Press, 2020). Capital, Vol. 1, p. 103, or MECW, Vol. 35, p. 20. This essentially foregrounds a similar s­ tatement in Chapter 25: “When this periodicity has once become consolidated, even political economy sees that the production of a relative surplus population . . . is a necessary ­condition Marx & Engels’ Studies of Crisies, 1843−1895 75 By 1882, the publisher of the Second Edition was running out of copies, so Marx, who at the time was working on Volume 2, began to make notes for the changes he wanted for a Third Edition. He died before he could complete either project. The first translation of Volume 1 was into Russian. Marx – who had studied the language in order to understand the struggles unfolding in that land – closely supervised the initial efforts by a young Russian, German Lopatin (1845−1918)) who came to London in 1870 to begin translating and corresponded with another, Nikolai Danielson (1844−1918) who completed the process (and later also translated Volumes II and III). The translation slipped by Czarist censors and appeared in 1872 – quickly selling more copies than the German and fueling debates between Russian “Marxists” and Russian populists.169 The second translation was into French and here again, Marx was intimately involved, editing, revising and adding to the translation. His deep involvement was undoubtedly spurred by the advantage he saw in how it was to be published: serially, in bite-sized morsels. He wrote to the publisher: “I applaud your idea of publishing the translation of Das Kapital in periodic instalments. In this form the work will be more accessible to the working class and for me that consideration outweighs any other.”170 He changed so much that in his Postface to the translation he wrote that “this French edition … possesses a scientific value independent of the original and should be consulted even by readers familiar with German.”171 The most significant passage concerning crisis that 169 170 171 for modern industry.” Ibid., p. 786, or MECW, Vol. 35, pp. 627−8. In the French edition Marx replaced “political economy” with “économistes.” See McLellan, Karl Marx: A Biography, 394. The debates – into which Marx was drawn – included one over whether revolution had to wait for the full development of capitalism and the rise of an industrial proletariat in Russia or could unfold successfully on the basis of peasant struggles. The dominant view of Marxists, in Russia and elsewhere, has been the former interpretation of Marx and Engels’ writings. They were dismissive of peasant struggles arguing their inevitable disappearance via the “proletarianization” with the development of capitalism. Once drawn in, however, and after studying the social situation in Russia, Marx took the side of the populists hypothesizing that in the case of revolution the peasant “mir” or village commune had the possibility of providing an alternative path for the “social regeneration” of Russia beyond capitalism. With the emergence of a world-wide indigenous renaissance, made visible and energized by the Zapatista uprising, this hopeful view of the potentialities of one kind of traditional peasant organization has received new attention. See, Theodore Shanin, ed., Late Marx and the Russian Road: Marx and the Peripheries of Capitalism (New York: Monthly Review Press, 1983). Marx to Maurice La Châtre, March 18, 1872, MECW, Vol. 44, p. 344. Capital, Vol. 1, p. 105, or MECW, Vol. 35, p.24. The failure of first Engels and then other editors of various English editions of Capital to include all of Marx’s changes has been repeatedly lamented by various commentators, including Kevin Anderson, “The ‘Unknown’ Marx’s Capital, Volume 1: The French Edition of 1872−75, 100 Years Later,” Review of Radical 76 chapter 2 he added to the French translation was the following, in which he argued that crisis only becomes endemic as capitalism becomes fully developed. But only after mechanical industry had struck root so deeply that it exerted a preponderant influence on the whole of national production; only after foreign trade began to predominate over internal trade, thanks to mechanical industry; only after the world market had successively annexed extensive areas of the new World, Asia and Australia; and finally only after a sufficient number of industrial nations had entered the arena – only after all this had happened can one date the repeated self-­perpetuating cycles, whose successive phases embrace years, and always culminate in a general crisis, which is the end of one cycle and the starting point of another. Until now the duration of these cycles has been ten or eleven years but there is no reason to consider this duration as constant. On the contrary, we ought to conclude, on the basis of the laws of capitalist production as we have just expounded them, that the duration is variable, and that the length of the cycles will gradually diminish.172 Because Marx was unable to finish preparing Volumes II and III of Capital before he died in 1883, Engels undertook to do so, publishing the first two years later in 1885 and the second in 1894. He also oversaw and edited the translation from the Third German Edition into English by Samuel Moore and Edward Aveling (Eleanor Marx’s partner), published in 1887. 3.5 Working Class Parties and Debates As workers were able to win the goal that had eluded the Chartists: laws giving propertyless workers access to participation in elections, this allowed many to abandon covert and illegal secret groups in favor of an overt and legal political terrain. They came onto a terrain, however, already shaped by the existence of formal political “parties,” i.e., institutions created by various political factions among capitalists, landowners and other property owners, e.g., the so-called “middle class.” Those parties organized the selection of candidates for public office; they drafted programs laying out their policy goals and they mobilized supporters to vote in elections. In England, such formal parties were created in the wake of the Exclusion Crisis (1679−1681), with the Whigs and the Tories contesting elections to Parliament. In the United States political 172 ­Political Economics 15, no. 4 (December 1983): 71−80 and Paul Zarembka, Key Elements of Social Theory Revolutionized by Marx (Boston: Brill, 2020). Capital, Vol. 1, p. 786 and Le Capital: Livre I, (Paris: Garnier-Flammarion, 1969), 462. Marx & Engels’ Studies of Crisies, 1843−1895 77 parties were created not long after the signing of the Constitution. The first American parties, formed in the late 1700s, emerged out of policy differences among advisors in the first presidential administration: the Federalist and Democratic-Republican Parties. By the time male British workers began to win the right to participate in elections, electoral politics in England were dominated by the Liberal (once Whig) and Conservative (once Tory) Parties, while in the US they were dominated by the Democratic and Republican Parties. In Germany, there were several parties representing various political interests, several of which dated from before that country’s unification in 1871. Faced with a terrain already well organized by their class enemies, militants in various workers’ movements had to decide whether to participate or refuse. For those who chose to participate, the question was how? Should they join existing parties – created by and in the interests of their exploiters – and organize within, pushing policies supporting workers’ struggles as some reformists had done in the past, or should they organize autonomously, ­forming their own working-class parties? Some workers, along with many middle-class reformers, chose to work within existing parties. Others, believing that the interests of those in existing parties were unlikely to be swayed by marginal worker participation, chose to organize independently. Yet those forming their own working-class parties, did so with the aim of winning public office, through which they hoped to lobby for and win legal and institutional changes of benefit to workers. In their most optimistic imagination, workers could gain enough positions to win ever greater reforms, transforming capitalism into something else, something better. As mentioned, others, such as Bakunin and his followers, refused to be drawn onto this terrain, preferring to continue organizing for the overthrow of the whole capitalist system, including its electoral infrastructure. Still others would attempt to organize both inside and outside the formal electoral system. Emerging working-class parties – like their predecessors – followed the common practice of drawing up and issuing public programs, laying out their ­principles and objectives for the world to see and assess – much as Marx and Engels did when they drafted the Communist Manifesto for the Communist League in 1848. Such programs commonly had some theoretical underpinning, either made explicit or implied, as well as indications of the kinds of policies and actions the issuing party intended to pursue. As parties contended or sought to collaborate, Marx and Engels continued to push their own perspective in working class circles and much of their writing was done as interventions into the resulting political battles within and between such parties. Without trying to cover the full extent of their efforts, I do want to comment on three famous efforts to influence the directions being taken by working-class parties: their 78 chapter 2 critique of the Gotha program (1875), Engel’s essay Anti-Dühring (1878) and his Socialism: Utopian and Scientific (1880), extracted from Anti-Dühring. 3.6 Marx: Critique of the Gotha Program The Gotha program was drafted by leaders of the Social-Democratic Workers’ Party (S-DWP) of Germany in preparation for a joint conference in Gotha, Germany with the General Association of German Workers (GAGW). The ­conference was aimed at unifying the two groups.173 The GAGW, the first political party in Europe to present itself as representing the interests of workers, was founded in 1863 by Ferdinand Lassalle (1825−1864) and continued, after his death, to be dominated by his followers. The S-DWP was founded in 1869, led by August Bebel (1840−1913) and Wilhelm Liebknecht (1826−1900) and based on the principles of the First International. With the objective of the conference being to achieve a unification of the two parties, the draft program, although written by the leaders of the S-DWP, sought to include ideas acceptable to the GAGW. Upon studying the draft program, both Marx and Engels felt their comrades in the S-DWP had conceded far too much to the Lassaleans. Like those who refused this terrain altogether, e.g., Bakunin, they clearly saw the danger of working-class parties’ effectiveness as organs of struggle being undermined by accepting to restrict their demands to those entirely compatible with capitalist development. Therefore, several of their critiques were aimed at avoiding such a fate. However, the sole aspect of crisis touched on in the draft and addressed in Marx’s letter of critique was the theoretical question of the proper working-class role in the final crisis – the end of capitalism.174 Of the many forces that tend to create ruptures and crises in capitalism, analyzed by them in other works (and sketched below in Chapters 4−8), he says nothing. What he does protest is the Lasallean substitution of “the social question” for class struggle and its faith, written into the program, that it is through aid from the government, especially in the form of support for worker cooperatives and education 173 174 The draft program was printed in Der Voksstaat, (S-DWP) No. 27, and the Neuer SocialDemokrat (GAGW) on March 7, 1875, according to footnote 95 of MECW, Vol. 24, pp. 602−603. It was from the former source that Marx lifted passages in his “Marginal Notes” mentioned below. They spelled out their critique of the draft program, in advance of the meeting, in a letter from Engels to August Bebel in late March, MECW, Vol. 24, pp. 67−73, and a letter from Marx to Wilhelm Bracke on May 5th, that included Marx’s “Marginal Notes on the Programme of the German Workers’ Party,” written in April-Early May 1875, MECW, Vol. 24, pp. 77−78, 81−99. Marx & Engels’ Studies of Crisies, 1843−1895 79 that capitalism can be brought to its end and replaced.175 Of cooperative ­societies, Marx writes, But as far as the present co-operative societies are concerned, they are of value only insofar as they are the independent creations of the workers and not protégés either of the governments or of the bourgeois.176 And of education, “Education of the people by the state” is altogether objectionable … ­Government and Church should rather be excluded from any influence on the school. Particularly, indeed, in the Prusso-German Empire … the state has need, on the contrary, of a very stern education by the people.177 In other words, he argues that it is only through their own, autonomous struggles, whether in dealing with capitalists or in creating new social institutions, that workers can end and replace the capitalist system. The state within capitalism was designed for its propagation and cannot be expected to become the vehicle of its supersession. He attacks neither the project of a unified party nor the participation of its members in elections nor the participation of any elected delegates in parliament, and thus within the German state. What he does protest is the abandonment of class struggle on other terrains and reformist demands that fail to lay the groundwork for further struggle. It is essential, he argues, to begin with the class struggles that the Lassaleans ignore and to recognize the important role of trade union actions, not only within each country but also coordinated (like capital itself) across borders, internationally (the objective of the First International). Fifthly, there is absolutely no mention [in the draft] of the organization of the working class as a class through the medium of trade unions. And that is a point of the utmost importance, this being the proletariat’s true class organization in which it fights its daily battles with capital, in which it trains itself …178 175 176 177 178 “In the place of the existing class struggle appears a newspaper scribbler’s phrase: ‘the social question’, for the ‘solution’ of which one ‘paves the way’,” MECW, Vol 24, p. 93. “Marginal Notes,” MECW, Vol. 24, p. 94. Ibid., p. 97. Engels to Bebel, London, March 18−28, 1875, MECW, Vol. 24, p. 70. 80 chapter 2 It is altogether self-evident that, to be able to fight at all, the working class must organize itself at home as a class … To this extent its class struggle is national, not in substance, but, as the Communist Manifesto says, “in form”. But the “framework of the present-day national state, for instance, the German Empire, is itself in turn economically ‘within the framework of the world market’,” politically “within the framework of the system of states”.179 In other words, workers’ self-organization, not just its consciousness, must match that of capital and be international. In short, the draft program is retrograde vis-à-vis the Communist Manifesto, written almost thirty years earlier! In its shift from recognizing how workers’ struggles could throw capitalism into crisis and how workers’ own initiatives could craft new alternatives, the program sketched principles of a social-democratic organization, which not only accepts to work within a political system organized by capital, but which also relies on a key element of that system – the government – to engineer its end. Marx was having none of it. No class struggle, no real crisis, no real change. Workers had to take over and dictate both the end of capitalist exploitation and the crafting of a post-capitalist order.180 Despite these and many other critiques, the joint conference adopted the draft program with only minor changes and the two parties merged to form a new Socialist Workers Party of Germany (Sozialistische Arbeiterpartei Deutschlands or SPD). United, it rapidly became the largest social-democratic party in Europe, participating in elections and winning seats in the German parliament. 3.7 Engels: Anti-Dühring Behind this abandonment of any mention of class struggle in the program of the SPD lay not only Lassalle’s ideas but also those of Eugen Dühring. A lawyer turned lecturer in philosophy and political science at the University of Berlin, Dühring had been the first person outside of Marx and Engels’ circle to write a review of Capital when it was published in 1867.181 Despite what he judged to be the review’s deficiencies, Marx appreciated the effort because it was better to be critiqued than ignored – which had been the general response of the German press. “I must be grateful to the man,” he wrote, “since he is the first 179 180 181 “Marginal Notes,” MECW, Vol. 24, pp. 89−90. This is my interpretation of Marx’s evocation of the “dictatorship of the proletariat” during the transition from capitalism to communism, as explained in my Rupturing the Dialectic, 238−240. E. Dühring, “Marx, Das Kapital, Kritik der politischen Oekonomie, 1. Band, Hamburg, 1867,” Erganzungsblatter zur Kenntngi der Gegenwart, Bd. 3, Heft 3, 1867, pp. 182−6. Engels published his own review in Die Zukunft, No. 254, October 30, 1867. Marx & Engels’ Studies of Crisies, 1843−1895 81 expert who has said anything at all.”182 That gratitude, however, was short-lived as Dühring repeatedly denigrated Marx’s ideas, while, to use the latter’s words, setting “himself up as a revolutionary in political economy” in such writings as: Capital and Labor: New Answers to Old Questions, Fragen: Berlin, 1865 and Critical Foundation of Political Economy, Berlin, 1866.183 He was also “setting himself up” by offering to those in the social-democratic movement alternatives to Marx and Engels’ analyses of capitalism, of its class struggles and of political strategy and tactics, in, for example, his Critical History of Economics and Socialism (1871, 1875).184 As Marx and Engels perceived important personages in the social-democratic movement, including Bebel, Liebknecht and Edward Bernstein (1850−1932) falling under Dühring’s spell, it became clear to them how Dühring’s ideas had contributed to the poor reception of their critiques of the Gotha program. Bebel, for instance, had already published in Der Voksstaat – the primary organ of the Social-Democratic Party – two articles praising Dühring in 1874, prior to the Gotha conference. In them, he declared Dühring’s latest publication “the best book on economics produced in the recent period since Marx’s Kapital and we may strongly recommend the study of the book.”185 In these circumstances, Marx decided that Dühring’s ideas needed to be critiqued “without compunction.”186 Under complaint, Engels quite reluctantly undertook to “break a lance with the tedious Dühring.”187 Albeit in consultation with Marx, he wrote and published a series of polemical articles in Vorwärts in 1877 and 182 183 184 185 186 187 Marx to Kugelmann, March 6, 1868, MECW, Vol. 42, p. 544. Ibid. The relationship between Dühring, Marx and Engels was usefully sketched by Gunter Krause in “Dühring in the perspective of Karl Marx and Engels,” Journal of Economic Studies, Vol. 29, no. 4/5, (2002): 345−363. These translated titles are from Krause; the originals are: Capital and Arbeit. Neue Antworten auf alte Fragen (Berlin: Verlag von Alb. Eichhoff , 1865) and Kritische Gnmdlegung der Volkswirthschafskhre (Berlin: Verlag von Alb. Eichhoff, 1866). Having been unable to discover any English translation of these works, I am forced to rely – with the usual amount of salt – on those who have read them in the original and given accounts in English. I am, therefore, not able to judge the degree to which Engels’ representations of Dühring’s ideas are accurate, or mere assertions, as Adamiak claims, “in its rendition of certain of Dühring’ ideas, marked distortion is evident.” Richard Adamiak, “Marx, Engels, and Dühring,” Journal of the History of Ideas 35, no. 1 (January – March 1974): 109 - 911. Kritische Geschichte der Nationalokonomie und des Socialismus, 1 Auflage, Leipzig, 1871, Berlin, 1875. “Ein neuer ‘Communist’,” Der Volksstaat, Leipzig, No. 30, Marz 13, 1874 and No. 33, Marz 20, 1874, cited and quoted in Adamiak, “Marx, Engels, and Dühring,” p. 106. Marx to Engels, May 25, 1876, MECW, Vol. 45, p.119. Engels to Marx, May 28, 1876, MECW, Vol. 45, p. 122. Besides finding Dühring “tedious,” Engels also complained about having to put aside his work on the dialectics of nature, a project upon which he had been working since 1873. 82 chapter 2 1878. He then combined these articles into a substantial book in 1878 – Herr Eugen Dühring’s Revolution in Science – one chapter was based on a draft­ written by Marx.188 Anti-Dühring consists of three parts: the first part covers Dühring’s writings on science and his “new” philosophical system. Here Engels draws on his own research on the “dialectics of nature.” The second part dissects Dühring’s supposed “revolution” in political economy and the third part challenges his analysis of the road to socialism. In so doing, however, Engels seizes the opportunity to not only critique Dühring but also to spell out many of his and Marx’s perspectives on these topics, exercises which make the book an important source on their views as well as their understanding of his. Given the focus here on their analyses of class struggle and crisis, I only highlight those of their views which touch on these subjects and leave aside all the rest.189 Although like Marx and Engels, Dühring critiqued capitalism and called for struggles for material gains via unions, strikes, etc., paving a road to socialism, unlike them he apparently argued that capitalism, like other oppressive ­systems before it, was based primarily on “force” rather than on economic relationships. Thus, for him, the “force state” became the primary object to be replaced and in its place, he offered a utopian vision of a decentralized socialist system of autonomous communes.190 Engels disparaged this vision, even more than he and Marx had done of earlier utopians, because Dühring didn’t have the excuse of writing before the struggles of industrial workers had really gotten organized, not only nationally but also internationally, e.g., the First International. Against Dühring’s analysis, Engels posed his and Marx’s understanding of how in the history of “civilization” the role of “force” was based on the mode of exploitation that underlay and defined both classes and their antagonisms. This view was worked out back in the 1840s and spelled out in writings such as the Economic and Philosophical Manuscripts of 1844, the German Ideology in 1846, and the Communist Manifesto in 1848. In Anti-Dühring this perspective is reiterated several times, in various chapters of the book. Sometimes it is in the same words found in those earlier texts, sometimes explained in later 188 189 190 Frederick Engels, Herr Eugen Dühring’s Revolution in Science, MECW, Vol. 25, pp. 1−309. That chapter was “X: From the Critical History” in Part II: Political Economy, MECW, Vol. 25, pp. 211−243. It will be obvious to any reader of Anti-Dühring that a whole range of issues taken up in Engels’ essay indirectly bare on their analyses of crisis and class struggle, e.g., his discussions of method, but I have chosen to limit myself here to only his direct comments on crisis. According to Adamiak, p. 103. Marx & Engels’ Studies of Crisies, 1843−1895 83 language, such as that of the Preface to the Contribution to the Critique of Political Economy or of Capital. For example, in the Introduction, Engels writes: Then it was seen that all past history was the history of class struggles; that these warring classes of society are always the products of the modes of production and of exchange – in a word, of the economic conditions of their time …191 Although Engels illustrates this interpretation with examples from various periods of history, my concern here is with capitalism and the crises experienced by its “warring classes,” i.e., capitalists and workers. What is striking in Engels’ treatment of crisis is his almost total reliance on the contradiction between the development of production and the limits on the size of the market. We have seen that the ever increasing perfectibility of modern machinery is, by the anarchy of production, turned into a compulsory law that forces the individual industrial capitalist always to improve his machinery, always to increase its productive force … [However,] resistance is offered by consumption, by sales, by the markets for the products of modern industry … The extension of the markets cannot keep pace with the extension of production. The collision becomes inevitable … collisions become periodic … since 1825, when the first general crisis broke out, the whole industrial and commercial world, production and exchange among all civilized people and their more or less barbaric hangers-on, are thrown out of joint about once every ten years … the productive forces are in rebellion against the mode of exchange …192 Within this scenario – familiar since their earliest writings – Engels does mention elements developed later, such as “hard cash” disappearing, credit now exploding, now vanishing, bankruptcy proliferating, big capitalists squeezing out little ones, but nowhere does he bring in the kind of detailed analysis of these things worked out by Marx in either Volume 1 of Capital or in his unfinished manuscripts. Least the reference to limits of consumption in the above quotation be miss-read as privileging “underconsumption” by workers, note 191 192 MECW, Vol. 25, p. 26. In a later formulation, Engels clarified by inserting “with the exception of its primitive stages,” ibid., p. 649, fn27. Ibid., pp. 262−263. 84 chapter 2 that the “products of modern industry” whose production is seen to repeatedly outstrip markets include both consumer goods and producer goods.193 Engels does add to Marx’s analysis of the increasing socialization of production. Marx laid out in Capital how the ever-increasing scale of capitalist production, through both concentration (investment) and centralization (mergers and takeovers) gave rise to the joint-stock or limited liability corporation, in which the diversification of ownership through the sale of corporate stocks and bonds results in the actual management of capital being passed to salaried corporate managers, whom he called “functionaries of capital” and Engels called “salaried employees.” Eventually, Engels argues, the scale of production and distribution outgrows the joint-stock company form of management, and, when “this form also becomes insufficient: the official representative of capitalist society – the state – will ultimately have to undertake the direction of production.”194 A takeover, he notes, already begun under Bismarck.195 He duly points out, however, that these transformations in the form of management “either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces … The more [the state] proceeds to taking over the 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.”196 Unfortunately, when Engels forecasts that the proletarian seizure of state power would immediately transform “the means of production into state property,” he fails to specify exactly how those proletarians can then make sure that 193 194 195 196 Despite Marx’s dismissal of such narrowing, the “underconsumptionist” theory of crisis embraced by many of his followers in the history of Marxism has always turned on the production of consumer goods and the limits on markets for them caused by workers’ low wages. This was also true among some non-Marxists, such as John A. Hobson (1858−1940) whose theories of both crisis and imperialism was founded on this perspective. The error of such analysis, clearly seen by Marx, was the failure to recognize how industrial products included both consumer and producer goods, so that inadequacies in aggregate demand might be traceable to either a shortage of expenditures by workers or of investment by capitalists. See Chapter 5.3. below. This error by Hobson was pointed out by John Maynard Keynes in his General Theory (1938), while ignoring how Marx had made the same point decades earlier. Ibid., p. 265. Ibid., fn *. Ibid., pp. 265−266. In this manner, Engels not only explains the emerging character of state capitalism in Germany but foretells the fate of socialism in Russia after 1917 as the result of Lenin and the Bolsheviks adapting the German model for the new Soviet ­economy. Marx & Engels’ Studies of Crisies, 1843−1895 85 the “capitalist relation” is, in fact, “done away with” and actually achieve the abolition of “all class distinctions and class antagonism,” and, in the process do away with “the state as state.”197 While Dühring’s projection of capitalism being replaced by a network of autonomous communes resembled earlier utopian projects, Engels’ under-specified alternative, echoing Marx’s affirmations in his critique of the Gotha Program of how workers would use state power to end and replace capitalism, left both of them open to the old Bakuninist charges of embracing a statist centralization of power. This Engels and Marx had long denied, yet their on-going refusal to imagine how the projected “dictatorship of the proletariat” could transcend the form of the state, meant that the charge continued to reappear, not only among their opponents in German social-democracy but throughout the history of “Marxism,” beginning with the “revisionism” of Edward Bernstein and Karl Kautsky (1854−1938) in the period of the Second International (1889–1916). Published in Leipzig in early July 1878, the circulation of Engels’ book was suddenly curtailed in October when Bismarck succeeded in getting an Exceptional Law against the Socialists passed, making the SPD illegal and banning its literature, including Anti-Dühring. Its underground circulation nevertheless succeeded in shifting some minds from Lassalean and Dühring’s views to ones more in line with those of Marx and Engels. Moreover, the law, which would remain in force until 1890, had the effects of both increasing support for the repressed party and stirring further debate within it.198 197 198 Ibid., p. 267. Lenin’s explanation of how these things would come about, of course, was through the actions of the Communist Party representing the interests of the workers. Unfortunately, despite claims that the CP organization was “democratic centralism,” no mechanism ever provided workers with the ability to counter the failure of the Party to act in their interest. As a result, workers within the USSR, like workers elsewhere, were thrown back on traditional methods of protest, including covert actions when the CPUSSR followed the German model of state capitalism in repressing overt dissent. The debates continued to reflect differences within the SPD over political strategy and tactics, including their manifestation in Party publications. One such debate unfolded during the planning of a Party paper to be published in Switzerland, to avoid the repression within Germany. In an internal “Circular Letter,” written by Engels in response to a proposal by Bernstein, Hochberg and Schramm, he blasted the “Zurich Trio” for arguing that the Party and its new publication should eschew overt support for working-class demands and struggle and seek instead to woe “supporters from the ranks of the educated and propertied classes”! Why? Because the Party needs “men (sic!) who are fit to represent it in the Reichstag.” This amounted, Engels argued, to abandoning the basic idea – laid out years ago in the Communist Manifesto – that ending capitalism and creating a new society must be done by workers themselves. There was nothing, however, in either document about any other aspect of crisis. 86 chapter 2 3.8 Engels: Socialism: Utopian & Scientific Paul Lafargue (1842−1911), an activist in the First International and ­husband to Marx’s daughter Laura, urged Engels to extract some chapters from ­Anti-Dühring into smaller publications to achieve a wider circulation in France of its ideas and analysis. Engels did so, revising and publishing three chapters, first in three issues of La Revue socialiste in March-May 1880 and then in a pamphlet titled Socialisme utopique et socialism scientifique that same year. A German version would follow in 1882 and an English one in 1891 under the title Socialism: Utopian and Scientific.199 With respect to crises, Engels’ only significant revision to his original essay is in Section II. In Anti-Dühring, his account of the progressive socialization of production included the formation of joint stock companies, an intermediary stage that would give way to the takeover of production by the state. But here, in his revised text, he inserts yet another intermediary stage: that of “trusts.” To wit: The producers on a large scale in a particular branch of industry in a particular country unite in a “Trust,” a union for the purpose of regulating production. They determine the total amount to be produced, parcel it out among themselves, and thus enforce the selling price beforehand … The whole of the particular industry is turned into one gigantic jointstock company; internal competition gives place to the internal monopoly of one company … In trusts, … production without any definite plan of capitalist society capitulates to the production upon a definite plan of the invading socialistic society.200 199 200 Friedrich Engels, Socialism: Utopian and Scientific, MECW, Vol. 24, pp. 281−325. Ibid., pp. 317−318, also MECW, Vol. 25, pp. 639−640. In his Preface to the Fourth Edition, Engels explains he added these words to the text of Anti-Dühring because “the new form of production, the ‘trusts’ ... have “become important.” May 12, 1891, MECW, Vol. 27, p. 202. Decades later, this theme of expanding capitalist planning laying the groundwork for workers’ control in a socialist society, was taken up by a dissident Trotskyist faction of the American Socialist Workers Party (SWP) known as the Johnson-Forest Tendency. In a pamphlet, Tendency members expanded the idea, drawing attention to workers – as well as capitalists – crafting new elements of a post-capitalist, socialist society in the present, J. R. Johnson (C. L. R. James, 1901−1989), F. Forest (Raya Dunayevskaya, 1910−1987) and Ria Stone (Grace Lee, 1915−2015), The Invading Socialist Society (1947). After breaking with the SWP and forming their own organization they further explored the idea in Facing Reality: The New Society … Where to Look for it, How to Bring it Closer. A Statement for Our Time (1958). Marx & Engels’ Studies of Crisies, 1843−1895 87 In other words, the dynamics of capitalist development results in ever more planning by bigger and bigger firms, effectively laying the groundwork for socialist planning. Unfortunately for the capitalists, however, Engels argues that “trusts of this kind, as soon as business becomes bad, are generally liable to break up …”201 The result of capitalist development, they may be; but they provide no solution to crisis.202 3.9 Engels: the Dialectics of Nature Upon completion of his book and pamphlet, Engels returned to his work on the dialectics of nature from 1878 to 1882. However, once again his research was cut short, this time by Marx’s death in 1883. Feeling compelled to finish the job of editing Marx’s manuscripts into Volumes 2 (completed in 1885) and 3 (completed in 1894) of Capital, he once again set aside his own research. As a result, he never did complete his work, leaving behind, as Marx had, only an incomplete manuscript and fragmentary notes. Nevertheless, the coherence of what he had already written did result in his manuscript and notes eventually being published in 1925 in the USSR. So, although it was published posthumously, the text does give us further insight into Engels’ thinking about crises in the period surrounding Anti-Dühring and Socialism: Utopian and Scientific. Because this project was focused on demonstrating how dialectics are as relevant to understanding nature as for understanding human society, the vast majority of his manuscripts and notes involve re-interpreting available scientific evidence and the evolution of science itself from the point of view 201 202 Engels, Socialism: Utopian and Scientific, MECW, Vol. 24, p. 317. Engels was not alone among Marxists in viewing the emergence of trusts as a new stage in capitalist development, with implications for crises. At the turn of the century, perhaps the most important study of this phenomenon was by the Austrian Marxist Rudolf Hilferding (1877−1941) who published his Finance Capital: A Study of the Latest Phase of Capitalist Development in 1910. Hilferding not only highlighted the rise of trusts and monopoly power but also showed how their formation in the field of finance increased the leverage of financial institutions such as banks over industrial firms to the point where the latter became dependent on the former and subject to their dictates with respect to decisions about investment, etc. Nor were Marxists alone in recognizing the rise of trusts. Muckraking (investigative) journalists reported on the power of Robber Barons and neoclassical economists’ theories of monopoly and oligopoly provided theories of how they limit output and raise prices – to the detriment of consumers. Both contributed to the rise of “anti-trust” legislation to curb such practices. Three decades later, the American Marxist Paul Sweezy (1910−2004) in his book The Theory of Capitalist Development (1942), while retaining Hilferding’s focus on monopoly, argued that the internal retained earnings of multinational, conglomerate, industrial corporations had grown to the point of freeing them from the kind of control by financial corporations that preoccupied Hilferding. 88 chapter 2 of materialist dialectics.203 There are only a few passages in these texts tying developments in science to crises within capitalism. They deploy basically the same concepts of crisis that are in the two works he did bring to completion, namely an emphasis on the tendency of production (supply) to outstrip available markets (demand). Engels also denounces the way Social Darwinists appropriated Charles ­Darwin’s analysis of evolution by reducing it to nothing but a “struggle for existence.” This amounted, he argued, to nothing but a “transference from society to organic nature of [Thomas] Hobbes’ theory of bellum omnium contra omnes and of the theory of competition.”204 This reduction completely ignored how “The interactions of bodies in non-living nature include both harmony and collisions, that of living bodies conscious and unconscious co-operation as well as conscious and unconscious struggle.”205 Engels was certainly thinking about how the capitalist organization of competition, both among themselves and among workers, was their way of managing networks of co-operation both within units of production and across industries.206 Moreover, he insists that where capitalism has developed, “where the means of development are socially produced – the categories taken from the animal kingdom are already totally inapplicable.” 203 204 205 206 This effort to demonstrate that everything develops in a dialectical manner lay the foundation for the emergence of dialectical materialism understood as a philosophy, indeed as a cosmology, one in which historical materialism is a subset. This perspective was reduced to a dogma under Stalin, one that had a crippling influence on the development of science in the Soviet Union and led to their being caricaturized as “diamat” and “histomat.” In less dogmatic forms they live on among some Marxists in journals such as Historical Materialism. “A war of all against all.” MECW, Vol. 25, p. 584. These passages were taken almost verbatim from a letter from Engels to Lavrov, ­November 12−17, 1875, MECW, Vol. 45, pp. 107−109. Remember how in Volume 1 of Capital, Marx immediately follows Chapter 12 on technological change being circulated by competition with Chapter 13 on Co-operation. Engels’ critique of the one-sided appropriation of Darwin’s ideas would find a more fully developed echo in Piotr Kropotkin’s book Mutual Aid (1902), also aimed against Social ­Darwinists, which demonstrated through numerous examples how among both non-­ human animals and throughout human history co-operation has been as essential to evolution as competition. Although Kropotkin (1842−1921) is generally viewed as one of the fathers of anarcho-communism, there is a considerable overlap between his analysis and that of Marx and Engels. See, H. Cleaver, “Kropotkin, Self-valorization and the Crisis of Marxism” (1992), Anarchist Studies (February 1993). Marx & Engels’ Studies of Crisies, 1843−1895 89 Finally, under the capitalist mode of production, production reaches such a high level that society can no longer consume the means of subsistence, enjoyment and development that have been produced, because the great mass of producers’ access to these means is artificially and forcibly barred; and therefore every ten years a crisis restores the equilibrium by destroying not only the means of subsistence, enjoyment and development that have been produced, but also a great part of the productive forces themselves.207 It is this wasteful character, he argues, that give the “struggle for existence” a whole new meaning. Namely: To protect the products and productive forces produced by bourgeois capitalist society against the destructive, ravaging effect of this capitalist social order, by taking control of social production and distribution out of the hands of the ruling capitalist class, which has become incapable of this function, and transferring it to the producing masses – and that is the socialist revolution.208 In other words, for the struggle for existence within capitalism to be successful, capital’s destructive methods must be replaced by non-destructive, careful planning by workers. 3.10 Periodical Crisis Becomes Permanent Stagnation? As part of his efforts to circulate Marx’s writings, besides editing and publishing the second and third volumes of Capital, Engels published two pieces in 1885 in which he raised what appeared to him to be a possible fundamental change in the pattern of capitalist crisis. The first was a preface he wrote for the first-time publication in German of Marx’s Poverty of Philosophy (1847), which had hitherto only been available in the original French. Prior to its publication with the new translation, Engels published his preface as an independent article “Marx and Rodbertus” in Die Neue Zeit, No. 1.209 In that preface, in the 207 208 209 MECW, Vol 25, pp. 584−585. Ibid. See the editors’ note 141 on the composition and publication of this piece of writing, MECW, Vol. 26, p. 647. This was not the only time Engels found it desirable to critique ­Rodbertus; most of his 1884 Preface to Volume 2 of Capital is devoted to showing the falsity of Rodbertus’ claims that Marx had plagiarized his own theory of surplus value. Capital, Vol. 2, pp. 83−102. 90 chapter 2 course of deploying Marx’s critique of Proudhon to counter attacks by Johan Karl Rodbertus (1805−1875) on Marx and Capital, Engels writes the following in a footnote: Since England’s monopoly of the world market is being increasingly shattered by the participation of France, Germany and, above all, of America in world trade, a new form of evening-out appears to have come into operation. The period of general prosperity preceding the crisis still fails to appear. If it should remain absent altogether, then chronic stagnation must necessarily become the normal condition of modern industry, with only insignificant fluctuations.210 [my emphasis] The old form of “evening-out,” of course, was the kind of crisis he had hitherto emphasized: periodic industrial overproduction, cutbacks in production and layoffs, accompanied by crises in finance from speculative busts, bank failures, etc., followed by a rapid recovery with expanding production, rising employment, new speculations, etc. His second discussion of such a possible failure of recovery came in an article, “England in 1845 and in 1885,” published in The Commonweal in March of 1885 in which he contrasts crises in those two periods.211 His analysis of the crisis of 1846 was basically the same as he and Marx had given at the time. Forty years ago England stood face to face with a crisis, solvable to all appearances by force only. The immense and rapid development of manufactures had outstripped the extension of foreign markets and the increase of demand. Every ten years the march of industry was violently interrupted by a general commercial crash, followed, after a long period of chronic depression, by a few short years of prosperity, and always ending in feverish overproduction and consequent collapse.212 Engels then sketches how, to avoid this pattern, English manufacturers pushed for free trade, succeeded in repealing the Corn Laws in 1846 and successfully 210 211 212 Friedrich Engels, “Marx and Rodbertus,” October 23, 1884, MECW, Vol. 26, p. 288, fn*. Friedrich Engels, “England in 1845 and in 1885,” MECW, Vol. 26, pp. 295−301. Engels attached this article as an Appendix to the first English edition of his The Condition of the Working Class in England, published in New York in 1887 to update the analysis, at least partially. He later integrated it into a new Preface to both English and German editions in 1892. So, the same passages, quoted here from the original article, can also be found in MECW, Vol. 26, pp. 399−405 and Vol. 27, pp. 257−69 and pp. 307−23. Ibid., p. 295. Marx & Engels’ Studies of Crisies, 1843−1895 91 expanded trade. They then credited “free trade” with “the revival of commercial prosperity” after the crisis of 1846−1847. To solidify their political power, they also took advantage of the resulting rapid growth to accept a restructuring of their relationships with workers. The Factory Acts, once the bugbear of all manufacturers, were not only willingly submitted to, but their expansion into acts regulating almost all trades, was tolerated. Trades Unions, lately considered inventions of the devil himself, were now petted and patronized as perfectly legitimate institutions and as useful means of spreading sound economical doctrines amongst the workers.213 The success of such education in pacifying labor, Engels argued, was in those “great Trades Unions,” where “the labor of grown-up men predominates” and whose leaders came to collaborate with their employers. There, the condition of workers “has remarkably improved since 1848” – to the point of forming “an aristocracy among the working class.” However, for the “great mass of the working people,” he cautioned, “the state of misery and insecurity in which they live now is as low as ever, if not lower.”214 In short, by accepting the demands of some workers, capitalists were able to strengthen the hierarchy in their labor force by dividing the working class as a whole, leaving most no better off than before. These changes at home, Engels argues, combined with the dominance of English manufactures in world trade to form a kind of hay-day for British capitalism, albeit one periodically plunged into crisis. All this, he argued, could continue only so long as British manufacturers dominated world markets. So, as in his critique of Rodbertus, Engels argued that as other countries gained ever larger percentages of markets the pattern of crisis would also change, a change already perceptible. We did not, indeed, pass through the full crisis at the time it was due, in 1877 or 1878; but we have had, ever since 1876, a chronic state of stagnation in all dominant branches of industry. Neither will the full crash come; nor will the period of longed for prosperity to which we used to be entitled 213 214 Ibid., p. 297. Ibid., pp. 298−299. Positing the income/wealth hierarchy imposed on the working-class as a simple dichotomy of a better paid aristocracy and a large mass of much less wellpaid workers would haunt Marxist thinking about that hierarchy for decades. In the worst cases, the entire working class of more industrialized countries would be treated as a sold-out aristocracy vis-à-vis the workers of countries capitalists had turned in exporters of raw materials. 92 chapter 2 before and after it. A dull depression, a chronic glut of all markets for all trades, that is what we have been living in for nearly ten years.215 [my emphasis] Engels repeated this same argument in both letters and publications over the next years. For example, in a letter to Danielson, in November 1885, we find: But the principal cause is undoubtedly the totally changed state of the Welmarkt [world market]. Since 1870, Germany and especially America have become England’s rivals in modern industry, while most other European countries have so far developed their own manufactures as to cease being dependent on England. The consequence has been the spreading of the process of overproduction over a far larger area than when it was mainly confined to England, and has taken – up to now – a chronic instead of an acute character. By thus delaying the thunderstorm which formerly cleared the atmosphere every ten years, this continued chronic depression must prepare a crash of a violence and extend such as we have never known before.216 And then, in a letter to Bebel the following year, he wrote, This is already the eighth year in which overproduction has exerted pressure on the markets and, instead of improving, the situation is getting steadily worse nor can there be any doubt that it is essentially different from what it used to be. Since the appearance of serious rivals to Britain on the world market, the era of crises, in the old sense of the term, has come to an end. If, from being acute, the crises become chronic yet lose nothing of their intensity, what is likely to happen?217 In his 1886 Preface to the English edition of Volume 1 of Capital, to explain why he judged that the “The working of the industrial system of [England] … is coming to a dead stop,” he wrote: 215 216 217 Ibid., p. 299. Engels to Danielson, November 13, 1886, MECW, Vol. 47, p. 349. Engels to Bebel, January 20−23, 1886, MECW, Vol. 47, p. 390. See also this follow-up letter, Engels to Bebel, March 18, 1886, where he agrees “with your view that periods of prosperity of over 6 months will cease to occur,” MECW, Vol. 47, p. 428. Marx & Engels’ Studies of Crisies, 1843−1895 93 Foreign industry, rapidly developing, stares English production in the face everywhere … While the productive power increases in geometric ratio, the extension of markets proceeds at best in an arithmetic one. The decennial cycle of stagnation, prosperity, overproduction and crisis, ever recurrent from 1825 to 1867, seems to have run its course, but only to land us in the slough of despond of a permanent and chronic depression.218 Projecting that this “present dreary period of stagnation shall not only become intensified, but that its intensified condition shall become the permanent and normal state of English trade,” he prophesizes that the resulting negative impact on workers, will bring about a renewal of workers’ struggles, up and down the hierarchy. When, he writes, the English working class loses “its privileged position; it will find itself generally – the privileged and leading minority not excepted – on a level with its fellow-workers abroad. And that is the reason why there will be Socialism again in England.”219 By “Socialism again in England,” Engels meant the revival of the socialist movement in that country. 3.11 The Second International Although during his last decade, from 1885 to 1895, Engels saw neither permanent stagnation nor the reduction of the standard of living of the English working class to that of their “fellow-workers abroad,” in 1889 he did see both a dramatic uptick in workers’ self-organization and strikes and the coalescence of an International Socialist Workers’ Congress in Paris in July. That Congress, which was attended by almost 400 delegates from workers’ and socialist parties in 20 countries, constituted the beginning of the “Second International” (1889−1916). It’s first action was to organize an international celebration of a workers’ May Day.220 The celebration of May Day in London, pushed back to May 4, was a dual affair: a huge gathering organized mainly by representatives of new trade unions of mostly unskilled workers, involving over 200,000 workers and a smaller one organized by conservative trade unions of mostly skilled workers – that “aristocracy” Engels argued had been collaborating with their capitalist employers and eschewing socialism and any kind of fundamental critique of 218 219 220 Friedrich Engels, “Preface to the English Edition” (November 5, 1886) in Capital, Vol. 1, pp. 109−113, or MECW, Vol. 35, p. 35. Friedrich Engels, “England in 1845 and in 1885,” MECW, Vol. 26, p. 301. Although May Day has since been associated with workers’ struggles, May celebrations long predated the rise of capitalism, the formation of the working-class and its struggles. See Peter Linebaugh, The Incomplete, True, Authentic and Wonderful History of May Day, (Oakland: PM Press, 2016). Originally a pamphlet published in 1986. 94 chapter 2 the system. It was the former, the great mass of newly activated unskilled workers whose rising led him to declare that “the English proletariat, rousing itself from forty years of hibernation, rejoined the movement of its class.”221 Those forty years he attributed to “the failure of the Chartist movement of 1836−50 and … the colossal rise of industry between 1848 and 1880,” during which time skilled workers had shared in the increased creation of wealth by collaborating with their employers. That period of quietude, he declared, “has come to an end.”222 During the five years that followed (1891−1895) Engels was mostly involved in contributing to the development of the socialist movement, especially in Germany but also in strengthening ties among the various socialist parties of different countries, partly through correspondence, partly through trips abroad, both to the continent and to the United States. That development, of course, involved plenty of debate over theory, strategy, and tactics. 3.12 Engels: Sources and Circulation of Crises With respect to theory, Engels often found his efforts to circulate his and Marx’s ideas frustrated by what he viewed as misinterpretations, including those about crises within capitalism. In an 1890 letter to Conrad Schmidt (1863−1932), Engels argues against the tendency to oversimplify the sources of crises by overestimating one source while ignoring others. As capitalism develops, he argues, crises can occur in quite different moments of its circuits because those moments become complex and generate their own internal dynamics. For example, despite reaffirming his and Marx’s longstanding position that “Production is, in the final analysis, the decisive factor,” he also recognizes how, … as soon as trade in products becomes independent of actual production, the former follows a trend of its own … does in turn obey laws of its own, laws inherent in the nature of this new factor; it is a trend having its own phases and reacting in turn on the trend of production223 Further, Once trade in money becomes divorced from trade in commodities, it will – under certain circumstances determined by production and by the 221 222 223 Friedrich Engels, “May 4 in London,” May 5−21, 1890, MECW, Vol. 27, p. 61. Ibid., p. 66. Engels to Schmidt, October 27, 1890, MECW, Vol. 49, p. 58. Marx & Engels’ Studies of Crisies, 1843−1895 95 trade in commodities and within those limits – develop in its own way subject to the special law and distinctive phases determined by its own nature.224 … it is, moreover, a fact that the money market may also have its own crises in which actual industrial disturbances play only a subordinate role, if any at all, and in this sphere there is much to be investigated, particularly in regard to the last 20 years.225 Moreover, If in addition and in the course of this further development, the trade in money expands to comprise trade in securities, the said securities being not simply government paper, but also the shares of industrial and commercial concerns, i.e., if the trade in money gains direct control of a section of the production by which it is largely dominated, then the reaction of the trade in money on production will be even stronger, and more complex.226 Not only is Engels recognizing how crises can break out in various parts of the circuits of capital for separate reasons, in production, commerce, money and financial markets, but also how these different sources of crisis then “react upon” or circulate to other moments of the circuits. I address such circulation in Chapter 5, Section 4 on the “Circulation of Breakdown”. 224 225 226 Ibid. Ibid. Engels’ “most striking” example of such financial control is “the North American railroads, the running of which is entirely dependent on the day-to-day stock market operations of a Jay Gould, Vanderbilt, etc., which have nothing whatever to do with any particular ­railroad or its interest qua means of transport.” Ibid., 59. This line of argument about financial control of industry will be taken up a decade later by Hilferding in his Finance Capital (1910) (see footnote 202). Chapter 3 Marx’s Theory of Accumulation Although, as we have seen in Chapter 2, Marx’s thinking was often inspired by Engels, it was Marx who developed a new theory of accumulation and spelled it out in theoretical detail in his major works, including the three volumes of Capital. Therefore, I treat this theory as Marx’s despite Engels’ acceptance of it and his many contributions to its elaboration, especially with regard to crises. Marx’s theory of accumulation can be thought of in two ways: first, as a theory of how capital tries to organize and reproduce society on an ever-larger scale, and second, as a working-class perspective on that society. Capital’s ideologs have their own theories – embodied in economics, sociology, industrial engineering and so on – designed to help solve the problems capitalists face, including those of crisis. Marx’s theory, on the contrary, although also a theory of capitalist society, is formulated to reveal what is most important for workers in their struggles, including a vision of the fragility and potential mortality of capitalism. In the Introduction to this book, I explained that “The central thrust of my interpretation of Marxian theory sees accumulation as the expanded reproduction of a fabric of capitalist control that is always tenuous, repeatedly threatened and often ruptured by workers’ struggles.” Marx’s theory of accumulation is thus a theory of what capitalists must succeed in doing to reproduce their kind of society on an expanded scale. His theory analyzes how capitalists attempt to expand their dominance by imposing ever more commodity-producing work, subordinating most of life to that work and by so doing exercising control over society. Yet, from its origins, people have resisted having their lives subordinated to work and struggled to avoid or escape it. As a result, accumulation, socially and materially speaking, is the expanded reproduction of antagonistic relations of struggle. accumulation reproduces the capital-relation on an expanded scale, with more capitalists, or bigger capitalists, at one pole, and more wage ­laborers at the other pole … Accumulation of capital is therefore multiplication of the proletariat.1 1 Capital, Vol. 1, pp. 763−4, or MECW, Vol. 35, p. 609. NB: Marx’s “proletariat” is made up of those workers who are paid money wages, either time-wages or piece-wages. However, payment for labor-power has come in many forms, some, also paid in money, are familiar, e.g., salaries © Harry Cleaver, 2025 | DOI:10.1163/9789004708631_004 This is an open access chapter distributed under the terms of the CC BY-NC 4.0 license Marx’s Theory of Accumulation 97 Following in the footsteps of the political economists of the eighteenth and nineteenth centuries, Marx identifies and provides a detailed dissection of the material elements involved in accumulation – money, commodities, production, means of production, and labor. As a result, many have seen Marx as just one more political economist, have read Capital and his other writings as an alternative political economic analysis of capitalism, one that has corrected some errors of his predecessors (or not) but remains basically on the same ground. This view, however, ignores not only how Marx explicitly identifies his project as a “critique” of political economy2 but also how his focus and objectives were entirely different from those of political economists. Political economy emerged from preoccupations of merchants, capitalists, and rulers with the generation of material wealth and the best ways to achieve it, while maintaining order in society. Whereas the two groups of thinkers who preceded the political economists, the mercantilists, who thought that trade was the main source of wealth (especially when it brings in more gold and silver money) and the physiocrats, who thought that only agricultural labor produced wealth,3 the political economists argued that not just agricultural labor, but all commodity-producing labor produces wealth. In all three cases, their writings address the needs of those who were putting people to work, whether in trade, manufacturing, or agriculture. Marx, on the other hand, appalled at the costs to humans and the rest of nature of this endless imposition of commodity-producing work, formulated his theory as a critique of the exploitation and alienation that results from the capitalist mode of generating wealth and as a contribution to resistance to it. Whereas political economists (and the economists who followed them) have or commissions, others, not paid in money, are less so, e.g., scraps of raw materials, housing, payment in kind (a small portion of a harvest), a bit of coal to heat company-owned cottages rented to miners, and so on. In general, in my exposition of Marx’s theory, “wages” can be understood in the general sense of payment for labor-power, unless otherwise more specifically indicated. 2 Both titles of his first two published books laying out his analysis of capitalism made this explicit: A Contribution to the Critique of Political Economy (1859) and Capital: A Critique of Political Economy (1867). In other works, such as Theories of Surplus Value, he spelled out his differences with political economists in great detail. 3 Political economy originated in the writings of the Mercantilists, most of whom were merchants and whose writings were almost always making the case for how their recommended policies would increase the wealth of both the nation and the crown. See, for example, Thomas Mun (1571−1641), Englands Treasure by Forraign Trade. or The Ballance of our Forraign Trade is The Rule of our Treasure (1664). Although critiquing the Mercantilists, Smith was careful to title his book in the same spirit An Inquiry into the Nature and Causes of the Wealth of Nations (1776). 98 chapter 3 always deployed their theories to meet the needs of capitalists, e.g., how to maximize profits, how to grow their system, Marx on the contrary deployed his in the interests of the exploited. His analysis is framed, in the language of Thomas Kuhn (1922−1996), by an entirely different paradigm.4 The theory Marx deploys, the questions he asks, the phenomena he chooses to examine in depth and his methods of analysis all differ fundamentally from those of political economists. 1 A “Labor” Theory of Value? Yet, at first glance Marx’s theory and that of his political economy predecessors seem identical in their common deployment of a “labor theory of value” – a theory later abandoned by economists. Upon closer examination, however, his theory turns out to be quite different. Whereas for political economists, labor creates “value” through its contribution to the production of wealth, for Marx the real “value” created for capitalists is the social role of labor in providing capitalists with its primary mode of social control, of organizing society. From the point of view of engineers, economists and some capitalists, labor is just one input or “factor of production” among others, alongside tools, machines, and raw materials.5 But for Marx, of all the elements of accumulation, labor stands out as the key social relationship through which capitalists organize, 4 See his books, The Copernican Revolution: Planetary Astronomy in the Development of Western Thought (1957) and The Structure of Scientific Revolutions (1962). Although his preoccupation was with grasping dramatic disjunctions in the evolution of science, as opposed to the common view of science developing in a smooth process of ever greater marginal understanding, the concept’s application to the social sciences has been widespread (and debated). 5 Although there are capitalists who view workers much as they view their machines, there are also capitalists who see the bigger picture, namely that in their kind of society it is their collective responsibility to put people to work so that society remains well ordered. An example of the former is quoted by Norman Ware, “I regard my work-people just as I regard my machinery . . . When my machines get old and useless, I reject them and get new, and these people are part of my machinery.” The Industrial Worker: 1840−1860, (Chicago: Quadrangle Books, 1964), 77. Examples of the latter can be seen in the capitalist diversion of profits from money-making into various foundations set up not merely as public relations (PR) ploys but dedicated to social engineering, e.g., promulgating public schooling and public health to create a healthier (and of course exploitable) labor force. The latest manifestation of this awareness – albeit in some cases undoubtedly pure PR – is “conscious” or “socially responsible” capitalism aimed at complementing the search for profits by concern with ESG issues (environmental, social and governance). Both kinds of capitalists – those with the narrow focus on profit-making and those with broader views of their social responsibility as managers of society – can also be found rotating in and out of government. Marx’s Theory of Accumulation 99 control and burden their world. Therefore, every element of accumulation must be interpreted in terms of its embodiment of that relationship. Tools, machines and raw materials have value not just because they are the products of human labor but because people can be put to work producing them. The more work it takes to produce them, the more “valuable” they are to the process of putting people to work and controlling them. Once this is understood, Marx’s labor theory of value can be read as providing a theoretical tool for analyzing the most important relations between the classes, how capitalists seek to reproduce those relations and why resistance arises. Marx locates the core of the class relation in the way the capitalist class monopolizes the means of producing the necessities of life and compels – through either direct force or the threat of poverty and starvation – the rest of society to work for it to live. What economists call a “labor force” – defined narrowly as the array of individuals either formally employed or looking for jobs – Marx calls a “working class” – defined more broadly to also include those reproducing that labor force. The distinctive features of this working class, as opposed to earlier forms of forced labor are two-fold. First, whereas in earlier societies how much those forced to work had to do was limited by the particular, concrete, and limited needs of those doing the imposing, in capitalism workers suffer an endless imposition of work because it is not just one method of control among others, but the primary mode of social control, one to be maintained and extended as much as possible and forever. As such it is accompanied and justified by ideologies that define humans (even their relationship to God) by their work. Capital did not invent surplus labour … where use-value rather than exchange-value of the product predominates, surplus labor will be restricted by more or less confined set of needs … in the capitalist the appetite for surplus labour appears in the drive for an unlimited extension of the working day …6 And not merely of the formal, contracted, working day, as he goes on to show, but of every dimension of life. As workers succeeded in limiting the hours of hired labor, capital moved to colonize time outside of waged or salaried jobs turning such mundane human activities such as children’s learning or taking 6 Ibid., 344−346, or MECW, Vol. 35, pp. 243−245. 100 chapter 3 care of families into the work of producing “labor-power,” the ability and willingness to work for capitalist employers.7 While the imposition of surplus labor, the extraction of surplus value (profit), may enrich individual capitalists, Marx’s analysis is focused instead on its social role. His interest in surplus value or profit is not in what capitalists siphon off for their own luxurious lifestyles but in how they invest it, putting more people to work, both directly and indirectly, and thus extending their control over society. The investment of money in obtaining labor-power, M – LP, is for putting people to work. So is the money spent on required means of production, M – MP. Producing the needed MP results in even more people being put to work. Therefore, investment, M – C(LP, MP), both initiates and continues the endless subordination of life to work. Any breakdown in investment, by undermining that subordination, threatens capitalist control over society. Second, in capitalism the dominant form of coercion is indirect. Those separated from any access to independent means of production (such as land and tools) are forced to sell their ability and willingness to work in exchange for wages or salaries, to obtain money which provides the only legal access to consumer goods and services. Where labor-power is sold like other goods, it is itself a commodity. Thus, the dominant social relations of classes in capitalist society may be defined as (1) the endless imposition of work through the commodity form, and (2) the struggle of people against that imposition and for their own ends.8 Capital establishes this dependency through processes of “primitive” accumulation in which people are stripped of their means of autonomous life and are forced to seek employment with the capitalist owners of the means of production.9 It maintains this dependency by continuing to monopolize the 7 Marx’s usual definition of labor-power is “the capacity to work.” Because work involves not just the strength and acuity to exercise various skills but mental control over that exercise, I disaggregate “capacity” into “ability and willingness.” Workers may have abilities they exercise enthusiastically, only reluctantly or not at all – as I discuss in Chapter 4, Section 4 on the possibilities of disruption in the sphere of production. 8 This analysis was first laid out in Harry Cleaver, Reading Capital Politically, 2nd ed. (Leeds: Anti/Theses and Edinburgh: AK Press, 2000). 9 The discussion of “primitive” accumulation appears in Volume 1 of Capital at the end, as Part Eight. In my courses on Capital, we started with that part, instead of the much more abstract theory of value in Part I. Why? Two reasons: 1) It provides a dramatic and easy to read historical narrative, and 2) it makes clear why the theory in Part 1 is a labor theory of value. The stripping of land and tools described in Part Eight is the precondition for the development of capitalism. Although Marx’s presentation is largely historical, the processes he analyzes have never ended, but continue right up to the present. This is true not only in remote areas where Marx’s Theory of Accumulation 101 means of production and by reorganizing social life to herd people into the labor market. In Marx and Engel’s time, capitalists used extremely low wages and hunger to drive everyone, men, women and children, into the search for waged employment.10 Although in Marx’s theory of capitalist accumulation the dominant, antagonistic social relationships which capitalists impose on the world are those between themselves and waged or salaried workers, for a very long time in the history of capitalism slavery played a hugely important role in early capitalist industrialization. Moreover, despite chattel slavery being eventually outlawed and illegal slavery being marginalized into the shadows, in many industries around the world capitalists have continued to force people to work against their will to generate surplus value and profit. What is commonly called “forced labor” today is really a euphemism for slavery. According to a joint report of the International Labor Organization, the Walk Free Foundation and the UN Migration Agency, “on any given day” in 2021 “there are 50 million people in conditions of modern slavery.”11 Marginal though slavery may be today, it ­continues to be an integral part of capitalism’s global work machine and one more source of widespread suffering. 10 11 people are not yet thoroughly integrated into the labor force – because they still have access to some common resources – but even in highly industrialized countries where capitalism has long been established. There too the theft of lands from the commons and the destitution of craftspeople continues. Some of this was analyzed in the 1980s, under the rubric of “The New Enclosures” by Midnight Notes. More recently the theft of land in the US from National Parks and other natural areas by the Trump administration, which then handed them over for capitalist exploitation, e.g., mining, opened a new phase of this very old process. As before, this attack on the commons is being resisted by environmental groups, Native Americans, and workers in general, loath to lose what little remains unspoiled by the ravages of capitalism. This imposed penury was, of course, complemented by severe punishment for evading the labor market and appropriating goods and services directly (“theft”). See Peter Linebaugh’s discussion of capital’s “thanotocracy” in his The London Hanged: Crime and Civil Society in the Eighteenth Century (London: Allen Lane, 1991). Then, in the wake of child labor laws restricting the exploitation of children and other laws restricting women’s access to jobs, it cultivated the nuclear family where women/ wives do the housework of gestating and rearing children while also taking care of the reproductive needs of employed husbands and helping force children into legally mandated unwaged schoolwork, conditioning them for later entry into the labor market. It has also limited any access to the means of subsistence outside the labor market, by keeping all legal forms of unwaged income very low, from parish relief in Marx’s time, to welfare and unemployment benefits in ours. All of these various forms of imposed work, waged and unwaged, have been resisted, often refused or sabotaged. See, The ILO, et.al., Global Estimates of Modern Slavery: Forced Labor and Forced ­Marriage, Geneva, (September 2022). 102 chapter 3 Despite writing quite a bit about slavery, both ancient slavery and that in the nineteenth century, Marx never included this form of imposed work in his formal theorization of capitalist social relations and their crises. However, because of both its historical significance and its persistence in the world today, I feel obligated to indicate, at least to some degree, in my sketch of his theory of capitalist accumulation and its crises, how the use of slaves fits into accumulation and the parallels and relationships Marx saw between the struggles of slaves and those of “wage-slaves.” In what follows, I first treat the concrete, material relationships that capitalists must create and maintain in order to reproduce their kind of society on an expanded scale and then, second, I explain how Marx analyzes those relationships in terms of value. 2 The Material Circuits of Accumulation I begin with the various material elements over which capitalists must gain control and organize so that their control can be perpetuated, preferably on an ever-larger scale: M — money, the universal equivalent of all commodities, which capitalists invest by obtaining labor-power, LP, and the means of production, MP, and used by workers to purchase means of subsistence, MS.12 MP — the means of production, which the capitalists monopolize as a class, use to put workers to work, and have workers produce to sell to other capitalists. These include raw materials extracted from the earth and fabricated tools, machinery, factories, means of transportation and communication. LP — labor-power, or the ability and willingness to work, which capital obtains either by hiring workers in labor markets or by extracting it through the direct coercion of slavery. P — production, or the processes in which capitalists put their workers to work with the means of production at their disposal. C — commodities, which are produced by workers, but are owned by capitalists and then sold to workers as means of subsistence, MS, or to other capitalists as MP. Although eventually proving to be marginal in capitalism, among the commodities produced and sold in capitalism have been slaves, human beings (and other animals) forced to work and thus a source of LP, even as they are treated as means of production. 12 I ignore here the many cases in which workers are paid in other forms, e.g., part of a ­ arvest, or other products of their work. h Marx’s Theory of Accumulation 103 MS — means of subsistence (or means of consumption): the commodi­ties (food, clothing, housing, and so on) necessary for the production and reproduction of LP, bought by hired workers with money obtained in exchange for their LP, or in the case of slavery, either produced for themselves or supplied by their owners.13 Each of these elements has to be employed successfully and in a certain order to achieve accumulation. Marx represented that order, which capital seeks to achieve and then to constantly repeat on an expanded scale, in two ways. The first, simplest representation, in Part 2 of Volume 1 of Capital, is the “general formula for capital,” M – C – M’, where M’ > M, in which capitalists spend money to make more money. But in this representation, as he points out, the source of the excess of M’ over M remains a mystery.14 The solution to the mystery, of course, is the labor expended in production. In his second representation, that labor is portrayed as the vital part of production, …P…, in what he calls the “circuit of capital.” In Part 1 of Volume 2 of Capital, the circuit is analyzed in terms of the reproduction of three of its elements: M (the circuit of money capital), P (the circuit of productive capital), and C (the circuit of commodity capital). In the representations of these circuits, dashes are used to represent market exchanges and dots to represent non-exchange relations. I use the circuit of money capital as the template for 13 14 Marx and Engels regularly used the term “subsistence” because in their time wages were so low that what workers could buy with their wages barely allowed them to scrape by. These days the term is usually only applied to peasants and farmers who are living off the land with little or no recourse to the labor market for income. The term “subsistence agriculture,” however, can also refer to the activities of waged or salaried workers who supplement their money income by gardening, canning, and raising animals. In times of high food prices, many workers, both waged and salaried, have been known to have increased recourse to these methods. An example was during the food crisis of the early 1970s when the US government engineered a dramatic rise in food prices by paying farmers to reduce production while negotiating a huge grain deal with the USSR. The expansion of gardening was so great it caused such an increased demand for canning jars as to result in a serious shortage. A similar run occurred more recently during the Covid pandemic when the loss of jobs and/or obligated home stays increased gardening. But in this case the shortage of jars was as much due to a series of takeovers that resulted in such a near monopoly of production that the main corporation producing canning equipment could reduce both production and sales, driving up prices (and, presumably, profits). On the 1970s case see, H. Cleaver, “Food, Famine and International Crisis,” Zerowork 2, (Fall 1977). On the recent shortage See, Debbie Stroud, “Where Are the Canning Jars? Is It 1975 All Over Again?,” North Carolina State University Extension Service, (August 21, 2020), who raises the issue, and Lois Thielen, who gives a better answer, “Why is there a shortage of canning jars and lids?,” Yahoo News, (April 6, 2022). For the mystery see Chapter V: “The Contradictions of the General Formula of Capital” in Volume 1 of Capital. 104 chapter 3 much of my exposition of Marx’s theory of accumulation (and crisis) because it makes it easy to follow Marx’s own analysis. Here is the circuit in two iterations through two time periods of accumulation. The M’ achieved in the first period makes possible in the second period the employment of more LP (LP’ > LP) and more MP (MP’ > MP), expanded production, more commodities, C”, and hence more revenue, M”. LP LP’ / / M — C . . . . . P . . . . . C’ — M’. M’ — C’ . . . . . P . . . . . C” — M” and so on. \ \ MP MP’ The meaning of this sequence is simple enough. Capitalists (if in the ­individual case),15 or capital in general, invest money to obtain labor-power, M – LP,16 and whatever means of production, M – MP, are required for the employment of workers, i.e., the tools, machinery and raw materials necessary to produce the intended new product, C’. The workers, both waged and slave, are then put to work, …P…, using the means of production, to produce new commodities, C’.17 Finally, those commodities, C’, must be successfully sold for money, C’ – M’, 15 16 17 NB: throughout this essay, I usually follow Marx’s habit of treating the behavior of individual capitalists only in so far as their actions are typical of capitalism in general. In other words, for my purposes I am not interested in their behavior as individuals per se. Folks with personal histories that lead them to take actions at variance with Marx’s theory would be in violation of capitalism’s “rules of the game.” I recognize that that both incompetent and well-meaning capitalists exist. The international debt crisis of the 1980s and 1990s revealed how bankers sometimes ignored their own internal warnings of dangerously high risk and suffered the consequences. The bursting of the dot.com speculative bubble of the 1990s revealed how greed and self-indulgence often overcame good capitalist practices and led to bankruptcy. It is also possible to identify individual capitalists who have adopted measures that benefit workers, or society at large, which in no way bolster their bottom line. Please note: this representation works regardless of whether the money, M, buys LP from workers who sell their labor-power, LP – M, piece-meal, or buys slaves, with whatever LP they possess, from other capitalists who produce them as C(LP) by either capture or breeding. So, if all goes as planned, they succeed, in the words of Cambridge economist Piero Sraffa (1898−1983), in achieving the “production of commodities by commodities.” See, Pierro Sraffa, Production of Commodities by Means of Commodities, Prelude to a Critique of Economic Theory (Cambridge, UK: Cambridge University Press, 1960). For economists more generally, what they succeed in achieving is the growth of output, in both material and monetary forms. For Marx and Engels, on the contrary, the main thing they succeed in reproducing are the antagonistic social relations of capitalism. Marx’s Theory of Accumulation 105 either to workers as means of subsistence or to other capitalists as means of production (or in the case of slaves, as sources of labor-power). While marketed C(MP)’ re-enter the circuit as new MP’, what of C(MS)’, consumer goods and services? They reinter the circuit, not as MS’, but as LP’. But how? Obviously via various forms of consumption. But unlike …P…, which designates the combining of LP and MP in the production of C’, Marx provides no parallel representation for the conversion of MS into LP. His “little circuit,” LP –M – C(MS), which represents waged workers obtaining and then spending their wages to purchase the means of subsistence, C(MS), ends with that purchase. There is no representation of either the work involved in finding jobs (job search), or that in the consumption of C(MS), e.g., shopping, cooking.18 Yet those are obviously essential elements in the reproduction of labor-power, including its reproduction on an expanded scale, i.e., the LP’ in the next circuit. As a representation of waged workers’ point of view, who sell their labor-power to obtain the means of life, LP –M – C(MS) is adequate; but as a representation of a moment of capital’s expanded reproduction, it leaves something to be desired.19 Only in the case of slavery might “…P…” be reasonably interpreted as 18 19 An example of Marx failing to analyze the work of shopping can be found in this comment: “The time that a worker needs to buy his means of subsistence,” he writes, “is lost time for him.” Capital, Vol. 2, p. 226, or MECW, Vol. 36, p. 153. While the time (and energy) spent shopping may be lost to other pursuits, to the degree that it contributes to the reproduction of labor-power it must be counted as unwaged work – regardless of whether the shopper enjoys or despises it. While theorists of ‘consumerism” point to middle-class enjoyment of shopping, the view of shopping-as-work is manifest in how the wealthy pay for the service of having others shop for them. “Personal shoppers”, who hire out by the hour, are today complemented by waged workers in big chain grocery stores providing the same service. Please note: Marx also fails to provide any representation of the work of looking for work, LP – M, which mostly falls on the unwaged. To include the reproduction of LP, the only element of the circuit unaccounted for in Marx’s representations, I have offered a parallel formulation of a “circuit of the reproduction of labor-power,” for the case of waged or salaried workers, i.e., LP – M – C(MS) . . . Pc . . . LP* where the Pc represents all the work – housework, schoolwork, subsistence agriculture, etc., required for consumption and reproducing the ability and willingness to work. See the appendix to H. Cleaver, “Malaria, the Politics of Public Health and the International Crisis,” Review of Radical Political Economics 9, (Issue 1, April 1977): 96−100. The reproduction of slave LP generally also requires the work of the slaves, e.g., producing food for themselves, taking care of clothes, shoes, etc., bought for them by their owners. This proposed fourth circuit is entirely different from the fourth circuit toyed with by Marx, discovered by Christopher Authur in a manuscript available only in German and in MEGA and analyzed in his article “Marx’s Fourth Capital Circuit,” Capital & Class, 59, Vol. 20, Issue 2 (Summer 1996): 31−36, and at greater detail in his “The Fluidity of Cap­ ital and the Logic of the Concept” in Arthur and Reuten, eds., The Circulation of Capital, 106 chapter 3 including the production of LP, where C’ = C(LP)’ = the slaves themselves, bred and then sold like MP but bought for their embodied LP. Marx does, however, discuss some of the work of consumption in his analysis of simple reproduction in Chapter 23 of Volume 1 of Capital and again in his analysis of expanded reproduction in Chapter 25 by calling our attention to the conditions of life suffered by workers outside the terrain of their employment. Those conditions, after all, shape the primary domains of reproducing laborpower. Although some of the reproduction of labor-power is often an “incidental part of the production process,” occurring on the job, such as learning skills, or eating or sleeping in worker dormitories on the job site, most of the work of reproduction occurs elsewhere, where “the capitalist may safely leave this [reproduction] to the worker’s drive for self-preservation and propagation.”20 This is also true in cases of slavery where the places they live are set apart and they can devote some time and energy to meeting their own needs and desires.21 The sites of that self-preservation and propagation by waged workers, which Marx has in mind, are homes and working-class neighborhoods. From the capitalist point of view, workers’ consumption is only about reproducing life as labor-power. The individual consumption of the worker, whether it occurs inside or outside the workshop, inside or outside the labour process, remains an aspect of the production and reproduction of capital, just as the cleaning of machinery does, whether it is done during the labour process, or when intervals in that process permit. The fact that the worker performs acts of individual consumption in his own interest, and not to please the capitalist, is something entirely irrelevant to the matter.22 Irrelevant, however, only to the degree that workers’ consumption of MS is limited to reproducing their labor-power and doesn’t fuel resistance to their exploitation or the elaboration of alternatives – whether individual or collective. However, given the antagonistic character of capitalist-worker 20 21 22 95−128. In all cases, these representations of reproduction leave out workers’ autonomous consumption, i.e., consumption that creates and supports life beyond, and often against, the reproduction of labor-power. Capital, Vol. 1, p. 718, or MECW, Vol. 35, p. 572. One breakthrough study of such self-activity among plantation slaves in the United States was George Rawick’s compilation of slave narratives and his prefatory volume From Sundown to Sunup: The Making of the Black Community (New York: Praeger, 1973). Capital, Vol. 1, p. 718, or MECW, Vol. 35, p. 572. Marx’s Theory of Accumulation 107 relationships, workers’ consumption has indeed often provided the energy to rebel, either on site or through flight. Elsewhere, Marx does recognize that capital doesn’t always “leave it to the worker’s drive for self-preservation” but actively intervenes in some domains of reproduction, e.g., workhouses, prisons and schools to obtain and shape the reproduction of labor-power, precisely to minimize the chance of them becoming sites of resistance and struggle.23 All of these, therefore, become – like the labor market and production – terrains of work, of class struggle and potential sites of crises in the capitalist ordering of society and its endless reproduction. It is this effort to achieve eternal return that justifies the metaphors of “circulation” and “circuit”. In Marx’s writings the representation of the circuit is linear. A better illustration of what capitalists are aiming for is a circular spiral in which both return and expansion are more obvious (Figure 3.1).24 Figure 3.1 23 24 Circuit as expanding spiral. Interventions in modern times have been far more extensive, reaching into every domain of the reproduction of labor-power. The metaphors of circulation and circuit originated in the analysis of the circular flow of blood, out from the heart through arteries and back to the heart through veins, by William Harvey (1578−1657), first spelled out in his De Mortu Cortis (1628). That understanding was taken up by the French physician turned economist, François Quesnay (1694−1774) and applied in his Tableau Économique that analyzed the circular flow of value from 108 chapter 3 At the end of a successful circuit, there are no qualitative changes in the basic conditions of the classes – capitalists still control the means of production and most workers still have their labor-power to be exploited. Thus, the class relation is reproduced, society is maintained in the same form, and the capitalists can deploy their surplus value to set the whole machine in motion, once again. What does change (hopefully, from the capitalist point of view) is the quantity of money in the hands of capitalists and thus their ability to expand their operations. Successful management results in extra or surplus work being performed in production, …P…, beyond that required to replace used up LP + MP. If all goes well, so much labor is extracted from the workers employed in the production of the final product, C’, that its value, and the money, M’, obtained from its sale, is greater than the value originally invested, such that C’ > C and M’> M. The excess labor embodied in M’ thus constitutes surplus value, or profit in money terms. Then by investing that surplus, capital can reproduce or grow the whole circuit on an expanded scale.25 More M means more LP and 25 agricultural labor to manufacturing and back again. Quesnay’s Tableau inspired both Adam Smith and Marx, both of whom argued that the source of value was not just agricultural labor but also that deployed in other commodity-producing industries. The long-lasting influence of this perception of circularity can be seen in the “circular flow” diagrams of virtually every introductory economics textbook. Those diagrams, of course, hide class relations by replacing the “workers” or the “working class” with “households” and capitalists or the “capitalist class” with “business.” The circularity, moreover, is also confined to markets with the only “value” in circulation being money whose amount is determined by the market prices of goods and services sold. The imposition of work in commodity production is buried inside “business” and the reproduction of labor-power is buried inside “households.” A fundamental difference between Marx’s theory of accumulation and economists’ theories of “growth” is how the former is formulated in terms of the social relations of labor while the latter have been – at least since the rise of neoclassical economics – formulated such that the only measure of value that matters are money prices. For example, economists’ measures of economic output, e.g., Gross National Product (GNP), and growth, e.g., percentage change in GNP, only count the monetary value of things and services sold. In Marx’s theory, the most important value to capitalists is the labor they are able to impose. Money merely embodies the exchange form of labor value, so money prices are grounded – although not uniquely determined – in that value. In his theoretical representations of the relationships involved in the accumulation of capital, Marx always assumes that (labor) value = (money) price and that all exchange is of equal values. Because he knows this is rarely the case, these are simplifying assumptions; there are causes of market fluctuations that raise and lower prices quite independent of any change in the value of commodities. (These assumptions are also basic to his theory of exploitation – which he demonstrates to exist even when there is equality in exchange.) He maintains this assumption as he analyzes the potential sources of crisis in accumulation and the forces Marx’s Theory of Accumulation 109 MP can be purchased, the scale of …P… can be increased and, if all goes well, an even greater value of commodities C’ can be produced and sold. Socially and politically speaking, the most important aspect of capitalist success in achieving an expansion of their system is the imposition of more work and more capitalist control. Yet, that also means the expanded system continues to be rife with all its antagonisms and conflicts. 3 Three Observations First, in Marx’s theoretical analysis, C’ – M’, like M – LP and M – MP, is defined as falling within the sphere of exchange, or of circulation. Yet, he recognizes that key elements involved in actual C’ – M’, such as “both transport proper and … and the transmission of mere information,”26 constitute moments of ­production, not exchange. Therefore, the work done by workers in those ­activities contribute to the value of C’. What the transport industry sells is the actual change of place itself … this journeying, the spatial movement of the means of transport, is precisely the production process accomplished by the transport industry … the exchange value of this useful effect is still determined, like that of any other commodity, by the value of the elements of production used up in it (labour-power and means of production), plus the surplus-value 26 that predispose the system to enter into crisis. However, when he analyses how things actually unfold in history, while the theory provides a guide, he drops this assumption and takes into account precisely those changes in price – and the roles they play in crisis – that have sources other than labor value. In this essay, I adhere to this practice, exploring both his theories of crisis in terms of value and his analyses of actual crises that recognize the influence of historical contingencies. Capital, Vol. 2, p. 134, or MECW, Vol. 36, p. 61. A certain amount of both transportation and communication naturally takes place directly within manufacturing, mining and agriculture as partially manufactured or partially processed product is moved from one site of production to another. Two examples: “for instance, cotton ... moved from the carding shop into the spinning shed” or “coal lifted from the pit to the surface.” Capital, Vol. 2, p. 227, or MECW, Vol. 36, p. 154. Each also requires coordination via communication among workers and between managers and workers. Multinational, conglomerate corporations, with production organized over several countries, have often found it useful to externalize these productive relations of transportation and communication by having subsidiaries buy them as services while selling intermediate products to each other. This allows, for example, the minimization of taxes by managing transfer prices between subsidiaries so that most “value added” occurs in low tax, rather than high tax countries. 110 chapter 3 created by the surplus labour of the workers occupied in the transport industry.27 [the transport industry] is distinguished by its appearance as the continuation of a production process within the circulation process and for the circulation process.28 I point this out because in my presentation of the possibilities of, predispositions to, and capitalist strategies to offset crisis, I organize my presentation according to the three stages of the circuit, 1) M – C(MP, LP), 2) …P…C’, and 3) C’ – M’. But, recognizing the productive function of the work done in transportation and in communication leads me to include their analysis within the second stage, …P…, rather than the third, even though they are material to the accomplishment of C’ – M’. Second, although most of Marx and Engels’ examples of commodities being produced in their time were things – whether C(MS)’ or C(MP)’, e.g., linen, coats, corn, iron, Marx did explicitly recognize that both services and slaves could also be produced and sold for a profit by capitalists.29 With respect to services, despite Marx not paying them much attention beyond transportation and communication – because he thought they constituted only a tiny part of capitalist commodity production – their steady growth in the nineteenth century (and since) warrants their explicit inclusion in the analysis of accumulation and its crises.30 We must, therefore, examine services, the work that produces them and the struggles of those doing that work, just as Marx studied those of workers producing things. Recognizing how transportation constitutes the service of moving commodities from here to there, and by so doing changes their use-values and thus adds value to them, implies that all work that transforms commodities by changing their use-values adds value to them. This includes a whole domain of labor long ignored by Marx’s followers: the work of selling involved in C’ – M’. There is a long-standing tradition among Marxists, derived from Marx’s assumption “that commodities are bought and sold at their value”, that all work 27 28 29 30 Ibid., p. 135, or MECW, Vol. 36, p. 62. Ibid., p. 229, or MECW, Vol. 36, p. 155. With respect to services, see Marx’s discussion of writers, artists, teachers, musicians, dancers and other performers in Capital, Vol. 1, pp. 1044−1048, or MECW, Vol. 34, pp. 448−452. He also noted the rise in intentional breeding of slaves once the international slave trade was outlawed and stopped. By the mid-twentieth century, the “service sector” was well on its way to becoming the largest part of capitalist commodity production. Marx’s Theory of Accumulation 111 involved in selling, C’ – M’ is deemed unproductive and involve costs that bear no fruit, a “faux frais” of commerce.31 Indeed, Marx wrote: all that is involved in these acts is the conversion of the same value from one form to another – from the commodity form [C’] into the money form [M’] …32 The general law is that all circulation costs that arise simply from a change in form of the commodity cannot add any value to it. They are simply costs involved in realizing the value or transferring it from one form [C’] to another [M’]. The capital expended in these costs (including the labour it commands) belongs to the faux frais of capitalist production.33 When applied to M – LP / LP – M, this assumption grounds his analysis of exploitation. By assuming workers are not cheated but paid the value of their labor power, he can locate exploitation in the surplus labor they do beyond what is necessary to produce their means of subsistence. But when this assumption is carried over to the analysis of C’ – M’ it leads to a certain blindness. To what? To how the “change in the form of a commodity” can be the result of all work which changes its use-value, as in transportation, which by bringing goods and services to buyers makes them immediately available. Such work adds value, possibly surplus value and by so doing meets Marx’s definition of “productive” labor. Although missing in Volumes 2 and 3 of Capital, Marx recognized this a decade earlier while writing the Grundrisse. There, he approvingly cited ­Heinrich von Storch (1766−1835)34 about the essential role of labor in making commodities available to buyers: [Trade] gives the product a new use value (and this holds right down to and including the retail grocer, who weighs, measures, wraps the product and thus gives it a form for consumption), and this new use value costs 31 32 33 34 One example of this tradition is the chapter on “the sales effort” in Paul Baran and Paul Sweezy’s book Monopoly Capital (New York: Monthly Review Press, 1964). Capital, Vol. 2, p. 207, or MECW, Vol. 36, p. 133. Ibid., pp. 225−226, or MECW, Vol. 36, pp. 152−153. On Storch, see Mark Blaug’s short bio in The New Palgrave Dictionary of Economics (London: Palgrave Macmillan, 2018), Jochen Schumann, “Heinrich von Storch’s innovative contributions to economics,” The European Journal of the History of Economic Thought 25, no. 2 (May 2018): 388−400, and Storch himself in Cours d’Économie Politique, ou Exposition des Principes qui Déterminent la Prospérité des Nations, 1815. 112 chapter 3 labour time, is therefore at the same time exchange value. The bringing to market is part of the production process itself.35 Moreover, we know that what constitutes the use-value of commodities lies not only in their intrinsic properties and in their availability but also in potential buyers’ perceptions. Many goods and services are often bought primarily for their symbolic use-value, e.g., as signaling status (social, sexual, political, etc.). Status, of course, in capitalism depends on one’s position in its hierarchies of income, power and celebrity. In Marx and Engels’ time this was obvious in the case of “luxury” goods purchased by capitalists or others high up the income hierarchy. It was also obvious to most of those nineteenth century novelists, from Jane Austen (1775−1817) to Henry James (1843−1916), who took on the changing class structure of the time, and how one’s array of luxury goods continued to differentiate social status.36 But even among low-waged workers and peasants, something as simple as meat bought and served on special occasions can be symbolic of care and affection, e.g., birthdays or marriages, or of appreciation of some special act, e.g., thanking neighbors who have helped in a harvest or donors who have helped rebuild after a disaster.37 Therefore, many of those Marx dismissed as “mere agents”38 of circulation turn out to be workers employed in changing the use-value of commodities, e.g., in market research to discover (or invent) such symbolic use-values, in advertising to design strategies to convince potential buyers that a given commodity can provide those use-values, still others to materially create the ­resulting advertising (mostly print in the nineteenth century) and, finally, some are employed in face-to-face encounters with potential buyers to convince them of the reality of the touted use-values. To sell machines to capitalists or food to workers requires the buyers be convinced that commodities do what 35 36 37 38 Grundrisse, p. 635, or MECW, Vol. 29, p. 24. In Jane Austen’s most famous novel Pride and Prejudice (1813), although trying to persuade Lizzy not to accept Darcy’s proposal of marriage, her father concedes that if she does, because he is rich she “may have more fine clothes and fine carriages than [her sister] Jane. But will they make you happy?” Still true. While visiting a poor peasant village in Guerrero, Mexico, after the earthquake of 1985, with Mexican activist Gustavo Esteva and representatives of the Swiss Red Cross, I saw just such a gesture: the pit-cooking of an entire goat to show appreciation of money donated by that agency to help locals rebuild their heavily damaged homes. These were peasants who usually subsisted on beans and corn tortillas, for whom eating meat was a rarity, a luxury reserved for special occasions. Capital, Vol. 2, pp. 208−209, or MECW, Vol. 36, pp. 134−135. Marx’s Theory of Accumulation 113 their sellers claim they do – which is often not the case.39 All these are part of the work of “sales” and to the degree such workers effectively change (or add to) the use-values of commodities, their work falls within the sphere of production and, like transportation, “is distinguished by its appearance as the continuation of a production process within the circulation process and for the circulation process.” Third, accumulation, the expanded reproduction of capitalist social relations, via investment, has been a process involving the annexation of ever greater swaths of humanity, first through colonialism and then through neocolonialism (what we now call globalization). This historical drama requires more of an explanation than being a mere by-product of the individual capitalists’ lust for self-enrichment and their competition with one another to see who can get the bigger share of the pie. The origins of this expansion that interest me most are in the dynamics of class struggle. Growth, it turns out, has often been the only way capitalists have been able to maintain control over those already working for them. Why? As Marx, Engels and several subsequent theorists of imperialism have pointed out, successful struggle for more income by already waged workers has driven capital to offset the resulting increase in costs by annexing cheaper sources of labor-power and raw materials. A parallel dynamic has resulted from workers’ successful struggles against work. Both successes, by reducing absolute surplus value have forced capitalists to invest in means of production that raise productivity to gain a compensatory increase in relative surplus value. But, raising productivity to lower per unit costs of production tends to drive expansion of production because increased productivity makes greater production possible and greater production requires expanded markets. In all these cases, it’s the successful self-organization of workers in their struggles, based on the existing concrete division of labor, which drives new investment and growth. Within this class 39 Marx and Engels both repeatedly cited and blasted poor quality consumer goods sold to workers. From Marx’s analysis of adulterated bread in Chapter 10 of Volume 1 of Capital to today’s worries about the proliferation of toxics and plastics in our food supplies, the cost cutting, profit maximizing practices of capitalists have continued despite the harm to consumers. Consumer awareness of those costs, thanks to the struggles of consumerists and environmentalists to reveal them, has forced capitalists to employ workers to convince consumers of the wholesomeness (use-value) of their commodities. The same has been true vis-à-vis the selling of means of production. There is a funny scene in Chaplin’s film Modern Times of one capitalist trying to convince another that his worker-feeding machine can be used to keep workers on the assembly line during lunch time. It repeatedly fails and is rejected by the potential buyer. These days the media of advertising differ markedly for C(MS) and C(MP), with the former dominant in television and popular newspapers and magazines and the latter largely restricted to trade publications. 114 chapter 3 dynamic, competition among capitalists merely decides which are more ­successful in adapting and which are less so. To successfully develop higher productivity technologies requires the harnessing of workers’ imagination and creativity to come up with newer, more productive machines or other technologies.40 Moreover, the adoption of more productive technologies requires control over workers who must adapt to the new rhythms of work – which are often organized to undercut their existing modes of self-organization. 4 Omnipresent Conflict; Omnipresent Struggle Under these circumstances, reproduction on an expanded scale is no smooth, simple matter, and much of Marx and Engels’ writing consists of analyzing how each of these steps involves an often-arduous struggle between the classes. The enclosures that have forced peasants off their land and stolen or destroyed artisans’ tools, forcing both into the labor market, have often been met with intense resistance. Faced with that resistance, capital has been willing to impose its new order through violence and bloodshed. But even where the separation has been made and capital has monopolized the means of production, the struggle has continued. The enforcement of “bloody legislation” has been required to force many of the dispossessed to actually enter the labor market – as opposed to opting for lives as vagabonds, highway robbers or revolutionaries. Branding irons, whips, chains and guns have been required to impose work, both slave and waged. Thus, the “rosy dawn” of capitalism. If money, according to Augier, “comes into the world with a congenital blood-stain on one cheek,” capital comes dripping from head to toe, from every pore, with blood and dirt.41 Accumulation involves capitalists’ efforts not only to establish their kind of society but to reproduce it on an expanded scale. And what they are trying to reproduce is the exploitative relationship between classes. 40 41 See, H. Cleaver, “Competition? Or Cooperation?” Common Sense 9 (April 1990): 20−22. Although the bulk of Marx’s analysis focuses on the development of machines and manufacturing technology, he also recognizes parallel productivity-raising developments in other realms of production, such as agriculture, transportation and communication. Capital, Vol. 1, pp. 925−926, or MECW, Vol. 35, p. 748. Marx’s Theory of Accumulation 115 Capitalist production, therefore, seen as a total, connected process, i.e., a process of reproduction, produces not only commodities, not only surplus value, but it also produces and reproduces the capital-relation itself; on the one hand the capitalist, on the other the wage laborer.42 In the labor market, capital and labor contend, over the terms of sale – how much money for how much work, under what conditions, and so on.43 The exchange concluded, the struggle continues during work itself – between the efforts of capitalists to obtain the maximum amount of work – whether manual or intellectual – from their workers and the latter’s struggle to give up as little of their life energy as possible. The same goes for slaves; they also struggle against the work imposed on them. Finally, not even the disposition of the final product, C’ – M’, necessarily runs smoothly. Rather, there is a wide variety of struggles ranging from workers’ direct appropriation of the goods they, or other workers, have produced, to struggles and wars over international trade – over what can be sold, where and at what price. In this way, each moment of the circuit, whether in the sphere of production (work) or in the sphere of exchange (labor and final goods markets), is not only a moment of the class relation but also carries the fundamental character of that relation: antagonistic conflict. Thus, each of the variables: LP, M, C, MP, P are elements, or moments, of the class relation of antagonistic struggle. Class struggle for Marx and Engels was not something outside the labor-capital exchange and work relations (neither a cause nor a consequence of it). Class struggle is rather the very subject of Capital itself. The self-reproduction or accumulation of society as a set of class relations involves the reproduction and accumulation of all these antagonistic elements of that relation, including the crises that result. 42 43 Capital, Vol. 1, p. 724, or MECW, Vol. 35, p. 577. The “microeconomics” analysis of the “labor market,” is usually framed with a ­function indicating the supply of labor – how much work workers are willing to do at various wages – and another function indicating the demand for labor – how much labor capitalists are willing to hire at various wages – the interaction of which determine actual wages and the level of employment. Excluded from this simplified vision are the complex issues actually negotiated between workers and employers, e.g., such as working conditions, collective bargaining, etc. Excluded too is any recognition of the difference between labor-power hired and actual work performed – a central issue for Marx but only belatedly (mid-twentieth century) recognized by economists in their analysis of “efficiency wages.” 116 5 chapter 3 Conditions of Reproduction Of the many conditions of this reproduction that Marx analyzed, beyond the question of control over its labor force, one of the most discussed has been the criteria of “proportionality.” To simply reproduce the existing situation, the means of production, MP, and means of subsistence, MS, must be produced in the proportions required to replace depleted means of production and the means of subsistence consumed by workers, whether they be waged or slave. While production P brings together LP and MP, this always occurs in a certain proportionate relation determined by the technology employed.44 Labor intensive production methods, using a lot of labor but few tools, will require greater replacement of the means of subsistence than of means of production. Capital intensive production methods where few workers are employed will require the reverse. Therefore, production must not be lopsided or disproportionate in such a way that either too little or too much MP or MS are produced.45 Marx formulated this by dividing production into two basic departments: one including all production of MP, and the other including all production of the means of subsistence MS.46 44 45 46 Neoclassical economics represents rough approximations of technology with production functions of the sort Q = f(K, L), where Q = total output, K = “capital,” understood as means of production and L = the labor expended by workers on the job (NOT laborpower). Such mathematical functions generally assume the factors of production, K & L, are infinitely divisible and can be combined, unproblematically, in all possible combinations defined by the functions. They are obviously gross simplifications of real technical relations. Although work can be performed in infinitely varying amounts, many means of production, e.g., machinery, factories, vehicles for transportation, are obviously “lumpy” and NOT smoothly divisible. These functions, however, serve the objectives of economists by providing tools to derive general principles capitalists can follow in order to maximize profits, respond to changes in the relative prices of labor and capital, etc. A theory quite different from Marx’s but designed for a different purpose. Economists generally assume that that failures in this regard will be easily corrected by capitalist adjustments in production. Excess production will be reduced in reaction to either a fall in price or a buildup of excess inventories. Inadequate production will be increased in reaction to rising prices or depleted inventories. The resistance to recognizing how such failures can occur on a very large scale and constitute crises goes back to David Ricardo and Jean-Baptiste Say, a failure denounced by Malthus at the time and later not only by Marx and Engels but also by John Maynard Keynes. The latter’s focus on correction in response to changes in inventory did not prevent him from seeing, as Marx and Engels had, how aggregate demand could not only fall so low as to cause a crisis but how it could also persist, threatening extended stagnation. Capital, Vol. 2, Part Three, Chapter 20, or MECW, Vol. 36, Part III, Chapter XX. This ­representation assumes that the labor-power hired in both departments, LP1 and LP2, are actually expended in utilizing MP1 and MP2 in the production of MP* and MS*. Marx’s Theory of Accumulation 117 Department I: LP1 + MP1 produces MP* Department II: LP2 + MP2 produces MS* In these circumstances, the necessary conditions of proportionality are that the total MP produced, MP*, must be sufficient to replace the MP used up in each department, while the total MS produced, MS*, must be enough to feed, clothe, house, etc., workers and thus support the reproduction of the laborpower in each department: MP* = MP1 + MP2 MS* = LP1 + LP2 If this is achieved, then the system will have produced the necessary means of reproducing the class relation. Once again, these relations are not simple technical ones but are an intrinsic part of the struggle between the classes. Clearly workers are interested in the output of MS meeting their needs, whereas capitalists’ major concern is having enough MP in order to keep control of the workers engaged in slave, waged or salaried employment – hence there is a class conflict over the allocation of resources between departments. The workers want to see Department I production geared to support Department II production, while capital must try to restrict the availability of wealth to workers (Department II production) to maintain control and force workers to work. If Department II production was such as to supply workers with vast quantities of means of subsistence their need to sell their labor-power to capital would be much lessened, and scarcity no longer a contrived and universal coercive force.47 47 Capital’s economists assume “scarcity” as a universal human condition. Indeed, they often define economics as the study of the allocation of scarce resources among competing ends. What Marx shows us, however, is how capitalists have created and maintain scarcity as a coercive force that gives them control over people’s lives. For an historical analysis of how this has been done over time see, Fredrik Jonsson and Carl Wennerlind, Scarcity: A History from the Origins of Capitalism to the Climate Crisis (Cambridge: Harvard University Press, 2023). Where state capitalists have engaged in active aggregate planning of investment, as in the Soviet Union or China, the preference for investment in Department I over Department II has been obvious in the drive to “industrialize,” to catch up to “Western” capitalist economies. The result, eventually, was rebellion on the part of workers against the failure to enhance production meeting their needs. That rebellion successfully forced a change in the planned allocation of investment among departments. Some of this history is analyzed with respect to food production in H. Cleaver, “Food, Famine and International Crisis,” Zerowork #2, 1977, pp. 7−69. A looser form of such planning can be found in so-called 118 chapter 3 But accumulation is more than simple reproduction – it is expansion. Accumulation is expanded reproduction of the social relations of society and involves the growth of its components. As in the case of simple reproduction, certain conditions must be met; in this case, overall expansion requires increases in production in each of the Departments. Investment must buy appropriate amounts of new MP and hire appropriate numbers of new workers, LP, so that their expansion in each Department proceeds in proportions which allow continued expanded reproduction. In simple reproduction, investment recreates the same amount of MP and MS. In expanded reproduction investment buys more MP and mobilizes more LP, so MP and MS must be expanded to MP* and MS* to meet the needs of each Department.48 Department I: MP* = MP1 + MP2 + new MP1 + new MP2 Department II: MS* = LP1 + LP2 + new LP1 + new LP2 A final point: While Marx spends a great deal of time analyzing and illustrating the production of MP and MS, he does not forget that while the production of MP involves the consumption of other MP, e.g., raw materials and depreciating fixed assets, the production of MS and its consumption by workers are two quite different moments of accumulation. Although, as he points out, a certain amount of the work of reproducing labor-power occurs on-the-job, most of it takes place elsewhere, during whatever time workers and their families have free of direct work for capital. After all, while M – LP for capital is a prelude to putting LP to work in …P…, LP – M for waged and salaried workers is a prelude to M – C(MS) and the subsequent consumption of MS. In the case of slavery, enough MS must also be available, either from the slaves’ own efforts or through purchase by their owners. Therefore, he points out, “for a full elucidation of the law of accumulation, [the worker’s] condition outside the workshop must also be looked at, his condition as to food and accommodation.”49 I already noted in Chapter 2 how Engels had reported, in part from personal observation, on these matters in The Condition of the Working Class in England 48 49 “supply-side” economic policies, which have been designed to shift resources in the opposite direction, from consumption of MS to investment in MP. See, H. Cleaver, “Supply Side Economics: The New Phase of Capitalist Strategy in the Crisis,” in French in Babylone, no. 0 (Hiver 1981−1982): 79-123, https://la.utexas.edu/users/hcleaver/304L/304Lsupplyside.html. Capital, Vol. 2, Part 3, Chapter 21, or MECW, Vol. 36, Part III, Chapter XXI. This is assuming increased MP does not result is such a displacement of LP as to reduce the amount of MS required. Capital, Vol. 1, p. 807, or MECW, Vol. 35, p. 647. Marx’s Theory of Accumulation 119 (1845) and later in his update “England in 1845 and in 1885.” Marx’s “looking” at those conditions appears to have taken place primarily through examination of the reports of public health inspectors, a method paralleling his manner of looking inside the sphere of production through the reports of factory inspectors. He was well aware of the limitations of his research into workers’ consumption and even apologized for it: “The limits of this book [Capital] compel us to concern ourselves chiefly with the worst paid part of the industrial proletariat and the agricultural labourers …”50 Nevertheless, as shown below in Chapters 4 and 5, what research he did perform contributed to his analysis not only of ­accumulation but also of the possibilities and predispositions to crisis. 6 Accumulation in Terms of “Value” Let us now turn from sketching the material circuits capitalists must successfully manage to achieve accumulation, to Marx’s analysis of those circuits and all their elements in terms of labor/value. Whereas capitalists measure the value of all the material elements of the circuits in terms of money, Marx follows Adam Smith and David Ricardo in providing a theory of the value of 50 Ibid. Much has been made in recent years of these limitations. Even in his “Workers’ Inquiry,” his 1880 list of 100 questions designed to reveal, from the workers themselves, “an exact and definite knowledge of the conditions in which the working class . . . works and begins to move.” very few of the questions address, even indirectly, conditions of life outside of waged labor. MECW, Vol. 24, pp. 328−334. One multipart question, #69, asks about the prices of the various commodities, C(MS), workers and their families consume, but not about the work of consumption itself. He doesn’t even replicate the kinds of questions asked by the British health inspectors whose reports he references in Capital. But since Mario Tronti’s analysis reminding us how Marx’s theory of accumulation includes the sphere of the reproduction of labor-power and since the main theorists of the Wages for Housework movement elaborated an analysis of the centrality to accumulation of the work of reproducing labor-power off-the-job, e.g., in the home through housework, Marx’s limited research and exposition of his findings have been amplified by an ever growing body of writing not only about that work but also about the struggle against it and the implications for class struggle more generally. See Mario Tronti, Operai e Capitale (Turin: Einaudi, 1966, 1971), now available as Workers and Capital (London: Verso, 2019), and Mariarosa Dalla Costa, “Women and the Subversion of the Community” (1971), in Mariarosa Dalla Costa and Camille Barbagallo, eds., Women and the Subversion of the Community: A Mariarosa Dalla Costa Reader (Brooklyn: PM Press, 2019). This work provoked first a widespread debate about “domestic labor” and its political implications and, more recently, a burgeoning derivative literature on “social reproduction theory” – that all too often ignores the earlier work that spawned it. Also See, Alisa Del Re, “Workers’ Inquiry and Reproductive Labor” in Viewpoint Magazine, 3, (September 25, 2013) and the rest of the issue. 120 chapter 3 money itself – and all the other elements – in terms of labor. But what does that mean? For Smith and Ricardo, it means that human labor creates wealth, first material wealth in the form of commodities and then, through sale, monetary wealth. In the Hegel-Marx tradition, labor input in production gives commodities their value, in the sense of their meaning, simply by being products of human action. In that tradition, use-values (and hence commodities) are the objectivization of human activity and because that activity has value – in the sense of being judged valuable by us humans – so too do its results. This view, clearly a-historical and applicable to all human history, is derived from the view that labor is the essence of humanity as a species. We are understood as homo faber – “’man’ who makes,” a quality which both Hegel and Marx thought differentiated us from other animals. Use-values, including those sold as commodities, embody this human essence and as such are valuable. This view is also associated with the belief that the labor incorporated in individual commodities underlies and ultimately determines their monetary value and thus their prices. But, as Marx readily admits – even though he usually assumes it away – prices rarely reflect labor value because of the endless fluctuations in supply and demand, which are caused by all sorts of things, many of which have nothing to do with any variation in the labor input. By the late nineteenth century, economists – working for capitalists for whom the prices of the commodities they buy and sell are all important because they determine their monetary profit – abandoned this privileging of labor and treated labor as simply one “factor of production” among others. The only value left was either the “utility” – the usefulness of commodities to those who buy them – or their monetary value, their price. Because usefulness varies from individual to individual, they were able to do away with any common notion of “utility” and replace it with the “preferences” of individuals as the basis for “price theory” or “microeconomics,” focused on the determinants of supply and demand in the formation of prices. Their dismissal of any special role for labor in determining monetary value has led to the long-standing debate with and among Marxists over the so-called “transformation problem” of whether it is possible to demonstrate some convincing connection between the array of labor values and the array of prices.51 51 Participation in this debate requires acceptance of economists’ preoccupation with price formation and a belief that Marx’s theory, as an alternative political economy, should be able to explain the array of relative prices as effectively as mainstream economics. If, in Kuhn’s language, both approaches shared the same foundational paradigm, or if the acceptance of a new paradigm depends on its ability to answer all the same questions posed by the previous one, then this demand would be reasonable. But, I argue on the contrary that: first, Marx’s labor theory of value has quite different purposes, namely Marx’s Theory of Accumulation 121 While accepting the view that the things people make and the services they provide are objectifications of human activity, I don’t see how that automatically makes them “valuable,” even to humans. After all, humans (especially within capitalism) create all kinds of things which are detrimental to humans as well as to the rest of nature. I see the “value” in Marx’s labor theory of value not as an a-historical judgement on what makes humans human and therefore on the worthiness of their activity and its results, but as an historically specific theory of the role of labor/work within capitalism, or, of the social/political value of labor/work to capital(ists). Unlike economists, I argue that Marx judged value to lie not just in labor’s contribution to the capitalist production of commodities but in its even more essential socio-political function as capitalists’ primary mode of social control. Therefore, the substance of the value of labor to capital is just this quality of providing its most fundamental means of organizing and controlling society.52 6.1 The Substance of Value Marx uses the term “abstract labor” to characterize the substance of value because it expresses how the kind of useful labor being imposed is – for capitalists – entirely secondary to the mere fact of controlling people by putting them to work. As long as the work it imposes produces a use-value which can be sold and upon which a profit can be realized, both the use-value of the commodity and the usefulness of the labor which produces it are secondary to the control established. Essential to maintaining that control are capitalists’ abilities to put workers to work first in this job and then in that job, depending on which kind of work produces the most profitable commodities. This amounts to achieving a malleability of labor – among jobs producing a single commodity or among jobs producing different commodities. Being able to use all sorts of imposed work to organize society requires being able to manage the allocation of work, being able to shift workers from one kind of production to another. Indifference towards specific labors corresponds to a form of society in which individuals can with ease transfer from one labor to another. and 52 revealing the nature of the antagonistic social relations of capitalism, and second, that when he addressed fluctuations in monetary prices he did so using the concepts of supply and demand available at the time. This is the contention laid out in my Reading Capital Politically (1979), amplified in Rupturing the Dialectic: The Struggle against Work, Money and Financialization (Oakland: AK Press, 2017) and detailed in Harry Cleaver, 33 Lessons on Capital: Reading Marx Politically (London: Pluto, 2019). 122 chapter 3 where the specific kind of labor is a matter of chance, hence of indifference. Not only the category, labour, but labour in reality has here become the means of creating wealth in general, and has ceased to be organically linked with particular individuals in any specific form.53 (my emphasis) The “indifference,” of course, is that of the capitalist, not of the workers who have no control over the tasks they are set, or the tools they are given, or the methods they are told to employ, and thus of the degree of exploitation and alienation to which they are subjected. The “chance” is the outcome of the vagaries of the market and thus of profitability. labor is not this or another labor, but labor pure and simple, abstract labor; absolutely indifferent to its particular specificity, but capable of all specificities … capital as such is indifferent to every particularity of its substance, and exists not only as the totality of the same but also as the abstraction from all its particularities, the labour which confronts it likewise subjectively has the same totality and abstraction in itself.54 An imposed abstraction and therefore alienating in all the ways Marx laid out in the Manuscripts of 1844, and therefore hostile! To achieve this, capital must keep workers divided. In other words, all ­specific labors turn out to be but moments in the process of controlling the working population – and thus the population as a whole, the unwaged as well as the waged or salaried. By imposing both a complicated division of labor and repeatedly re-dividing it, capital manages the vast system of “cooperation” that has sustained society in ways that pit workers against each other insuring its control over them all.55 6.2 The Measure of Value Under these circumstances the measure of the value of labor, or work, is simply the time imposed, more precisely, the “socially necessary” or average labor time imposed. The value of a commodity to capital is the average amount of time labor that can be imposed in its production. If productivity rises in the production of a commodity so that it takes less time to produce each unit, 53 54 55 Grundrisse, p. 104, or MECW, Vol. 28, p. 41. Grundrisse, p. 296, or MECW, Vol. 28, p. 223. And, to the degree that it is under its control, unruptured by workers’ resistance, it ­pretends to be the source of the productive power of cooperation – as Marx argues in Chapter 13 of Volume 1 of Capital. Marx’s Theory of Accumulation 123 then the value of that commodity falls because producing it provides less of an opportunity for putting people to work.56 Finally, as illustrated in the circuit of capital above, work is organized by capital to produce commodities, C’, i.e., MS, MP, and even C(LP) and thus, when sold, takes the commodity-form of exchange-value.57 By abstracting from the concrete characteristics of the different kinds of work that produce different kinds of commodities, Marx can theoretically measure each of the variables in terms of social necessary labor time (the measure of value). This makes possible quantitative comparisons, such as total sales, M’ compared with initial investment, M. If M’ > M, a surplus value is achieved in the form of money profits, which permit increased investment and growth in the entire circuit. When money is, itself, a commodity, e.g., gold or silver, its value is determined by the socially necessary labor time required to produce it. When it is merely symbolic, e.g., paper or digital money, the value of each unit is 56 57 Recognition of this consequence caused much worry among capitalists and their e­conomists in three relatively recent situations. First, during the rapid increase in labor-displacing automation in manufacturing in the 1950s and 1960s, they worried about where the jobs would come from to keep most people employed. Second, in the post-­ colonial era, continued expropriation of peasants and their forced exodus into cities led economists to worry about whether imported technologies were “appropriate” to absorbing the population no longer employed in agriculture. Capital-intensive technologies were critiqued as inappropriate, whereas labor-intensive ones were deemed more appropriate for solving this need to keep the displaced population busy and under control. Third, the onset of the computer revolution was feared to initiate such a rapid rise in automation as to, once again, create worry about where jobs might be found. The onset of global high unemployment in the early 1980s led critics of capitalism to suggestions that if capital couldn’t provide income thru jobs, income should no longer depend on jobs. This touched off demands for guaranteed minimum income for all citizens. In the first case, the problem was solved by the rise of the service sector, largely labor-intensive. In the second case, the problem was “solved” only partly by economists but mostly by the rural-urban migrants themselves, as they invented myriad ways of staying alive in the so-called “informal sector.” Grassroots activist and advisor to the Zapatistas, Gustavo Esteva (1936−2022) pointed out, long ago, that the so-called “marginals” in the Global South actually constitute a “social majority.” See his “Los ‘Tradifas’ O el Fin de la Marginación,” El Trimestre Economico, Vol. L(2), Núm. 198 (Abril-Junio de 1983): 733−769. The third case – accentuated by the rapid development of artificial intelligence – is still playing out amidst neoliberal attacks on good jobs and all forms of income not based on work. In the original version of this article this line read “. . . work is organized by capital into the production of commodities, either LP or C . . .” Although true, only the waged work that produces C(MS) is accounted for in Marx’s circuit of capital. Although recognized elsewhere, as I have indicated, none of the unwaged work of producing LP, e.g., housework or schoolwork, is included in his circuits. 124 chapter 3 determined by the value of commodities it circulates. In this second case, an aliquot portion of money represents a given amount of value. 6.3 The Form of Value The substance of value, work abstracted from its particularities, can only be extracted after labor-power is obtained and put to work, either purchased in the labor market (most cases) or in the form of slaves. In turn, the products of that imposed labor can only contribute to accumulation by being sold in commodity markets for money. With markets, or exchange, being essential to the realization of the substance of value, the harnessing of potential laborpower as actual labor, etc., Marx calls the form of value, exchange-value. On the simplifying assumption, which Marx almost always uses, that exchange is equal, value for value, we can see that in investment the total value represented by M is converted into an equal value of LP + MP in some proportion, depending on the value per unit of LP and of MP and the technology used in P, which determines the “technical composition” of capital, which Marx expresses as MP/LP. Because the substance of value is work (abstract labor), the aim of capital, if it is to expand, is to obtain more work (value), and this is exactly what it seeks when extracting living labor from the purchased LP in the production process. The object is to impose enough additional work so that the labor incorporated in the product C’ has a greater value than the ­original value M and the purchased commodities C(LP + MP). In order to be able to continue putting people to work, this commodity C’ (with expanded value) must then be sold and converted into money (M’), the universal equivalent, or most general form of value, which can then be expended on new LP and MP and so forth. Marx calls the value (M) invested in labor-power (LP) “variable capital,” or “v,” and that invested in the means of production, MP, “constant capital,” or “c”. So, in value terms, capitalist success in expanding value (getting more work) requires investing M in c + v and then managing production, …P…, such that the newly employed labor-power utilizes the constant capital productively, i.e., in such a way that the labor that previously created the constant capital effectively contributes to the value of the final product (C’). It must also cover its own cost (v). Then, if the capitalists succeed in getting workers to do more work than required for these two purposes, the extra work constitutes surplus labor and thus surplus value, or “s”. In short, to survive and reproduce on an expanded scale, the value of the original investment, c + v, must be expanded such that the value of the new C’ is c + v + s. The surplus labor imposed, or surplus value, s, is thus one measure of Marx’s Theory of Accumulation 125 success as well as the means of future expansion.58 This surplus value, when it takes the money form through C’ – M’ can be used to purchase new LP and MP. We can re-represent this whole sequence as follows, beginning in time period t1: LP / M—C \ MP (the M expended on C(LP + MP) = c + v) . . . P . . . C’ (in production workers preserve c and add v + s, so, C’ = c + v + s) In the next period (t2), the s is reinvested in new c and new v, so the increased amounts of MP and LP produce s + s’. at t1 C’ = c + v + s and at t2 C’ = c + v + new c + new v + s + s’. Integral to this process is the expenditure by workers of the value of their wages, v, on the means of subsistence/consumption portrayed in the second half Marx’s “little circuit,” i.e., M (wages) – C(MS) and, by implication, the actual consumption of the workers which reproduces their labor-power, LP. That consumption, whether of waged workers or slaves, also often provides them with the ability to struggle against their exploitation by capitalists and to experiment with alternative, non-capitalist activities. The result of continual successful reinvestment is a growth in each of the variables – all of which are elements of the class relation.59 Socially ­speaking, 58 59 Besides the surplus value, s, itself, Marx offers two other “measures of success,” namely the “rate of profit,” s/(c+v), and the “rate of exploitation,” s/v, with the former expressing capitalists’ calculation (surplus/investment) and the latter the ratio of surplus labor extracted to the labor required for workers’ consumption, i.e., the degree to which they have been forced to work beyond meeting their own needs. “Growth in each of the variables” unless new machines, introduced to increase productivity, displace so many workers (raising MP/LP) that despite new investment expanding production fewer workers are employed. Some displacement has always been a part of capital’s strategy of relative surplus value, one which has contributed to the generation of a “reserve army” of the unemployed – useful in holding down wage growth and providing labor-power for new investments. 126 chapter 3 accumulation is the accumulation of the working class and capital, and includes the accumulation of money, of commodities and of the means of production. At each stage in this process, each element and relation is an object of struggle, and because everything is growing, accumulation is also class struggle on an ever larger scale. As capital expands, bringing more and more of the world’s population under its control and converting more and more of Nature into mere resources for commodity production, the class confrontation becomes global and every element/moment is a site of struggle. Now if these are the basic processes of accumulation, and if this accumulation reaches world dimensions, the further development of the theory of accumulation is a detailed study of the way in which these various moments of expanded reproduction are organized and of how that reproduction is often ruptured. This latter is the theory of crisis. It includes (1) the repeated collapse and recovery that we know as cycles, (2) the deeper historical crises that have characterized major turning points in the organization of capitalist reproduction, and, if it can be accomplished, (3) the ultimate crisis through which the system is abolished.60 60 Although some Marxists and many critics of Marx have read a teleological necessity into his theory of crisis indicating the inevitability of a final crisis of capitalism, others of us see no such necessity but rather a theory designed to facilitate workers’ struggles to bring on such a crisis and the revolutionary transcendence of capitalism. Chapter 4 The Possibilities of Crisis The possibilities of crisis mean possible interruptions in the cycle of expanded reproduction. With the cycle or circuit as a whole made up of several different processes, often separate in time and place, there is the possibility of failure in each process, which must be successfully realized and in proper relation to the others, for the whole circuit to be completed. This contingency reveals that just as there are possibilities of crisis within capitalist efforts at expanded reproduction, so too is the expanded reproduction of capital itself merely a possibility, by no means guaranteed! Indeed, as they proceed, trying to complete each stage of their circuits – while trying to manage all the other institutions of society that they have reshaped for their own purposes – they are repeatedly confronted with the very real possibility of failure at each point. So, what some see as an almost unstoppable juggernaut turns out to be a rather fragile affair, tenuously held together and needing to be repeatedly patched up. Capitalists, of course, have always known this, which is one reason why they have frequently argued that they deserve profits for having hazarded their money in risky investments! Returning to the metaphor of the circulation of blood, which – through Quesnay – inspired Marx’s theory of circuits, the counterpart to a crisis in capitalist reproduction would be some rupture in the flow of blood, e.g., a blood clot that blocks the flow, or a wound out of which the blood flows instead of through the body. Failures in the various moments of capitalist reproduction, like blood clots or wounds, can be small or large, cause temporary problems or threaten the life of the system. This suggests that examination of the ­possibilities of crises must involve not only their identification but also some evaluation as to the degree of risk that they pose to accumulation as a whole. Traditionally, focused as they have been on their hopes for the death of capitalism, many Marxists have looked only at those possibilities they have felt might result in the collapse of the system. However, as I show below, such major crises do not arise out of the blue but tend to be the product of an accumulation of smaller, less noticeable crises. Therefore, in what follows I pay attention to all the possibilities that Marx & Engels identified, both large and small. © Harry Cleaver, 2025 | DOI:10.1163/9789004708631_005 This is an open access chapter distributed under the terms of the CC BY-NC 4.0 license 128 1 Markets & Crisis chapter 4 In his exposition of his theory of crisis, before turning to the possibilities of crisis in the circuits of capital, Marx first points out the potential for crisis in the character of markets. It exists because in commodity exchange, C – M – C, the two acts of sale, C – M, and purchase, M – C, are separate. Here, as in his analysis of accumulation, he measures these variables by labor value and to simplify things he assumes equality in exchange. He writes of this in the Grundrisse, then in his Contribution to the Critique of Political Economy (1859), again in the section of the “Manuscript of 1861−63” that became Theories of Surplus Value (TSV) and finally in Capital, Vol. 1 (1867). In the Grundrisse, he points out how crisis lurks in the very nature of commodities and the contingency of C – M. The simple fact that the commodity exists doubly, in one aspect as a specific product … and in the other aspect as manifest exchange value (money) … this double, differentiated existence must develop into a difference, and the difference into antithesis and contradiction … this contradiction … contains the possibility that these two separated forms in which the commodity exists are not convertible into one another … the exchangeability of the commodity for money … may or may not be present.1 Then: Just as the exchange value of a commodity leads a double existence … so does the act of exchange split into two mutually independent acts … purchase and sale. Since these have now achieved spatially and temporally separate and mutually indifferent forms of existence, their immediate identity ceases. They may correspond or not … consonance may be reached only by passing through the most extreme dissonance.2 A little further on, against political economists such as Jean-Baptiste Say who argued “supply creates its own demand,” i.e., every sale results in a purchase, he counters, There are contradictions which are unpleasant for the apologists of bourgeois common sense, and must hence be covered up. In so far as purchase and sale … are indifferent to each other and separated in time and space, 1 Grundrisse, p. 147, or MECW, Vol. 28, pp. 84−85. 2 Ibid., p. 148, or MECW, Vol. 28, pp. 85−86. The Possibilities of Crisis 129 they by no means need to coincide … But in so far as they are both essential moments of the whole, there must come a moment when the independent form is violently broken and when the inner unity is established externally through a violent explosion … in the splitting of exchange into two acts, there lies the germ of crises, or at least their possibility”3 In the Contribution to the Critique, he writes, The division of exchange into purchase and sale … contains the general possibility of commercial crises, because the contradiction of commodity and money is the abstract and general form of all contradictions inherent in the bourgeois mode of labour.4 This is true regarding both cash money, which may or may not be used to purchase directly, and with credit money. Whether credit money serving as a means of payment will be forthcoming after commodities have already been delivered is always an open question. The difference between means of purchase and means of payment becomes very conspicuous and unpleasantly so, at times of commercial crises.5 Where chains of payments … have been developed, any upheaval that forcibly interrupts the flow of payments and upsets the mechanism for balancing them against one another suddenly turns money from the nebulous chimerical form it assumed as measure of value into hard cash or means of payment … The summum bonum, the sole form of wealth for which people clamour at such times, is money, hard cash …6 In the “Manuscript of 1861−63”, he writes, “The possibility of crisis lies solely in the separation of sale from purchase.”7 And then: The general, abstract possibility of crisis denotes no more than the most abstract form of crisis, without content, without a compelling motivating factor [predisposition] … The most abstract form of crisis (and therefore 3 4 5 6 7 Ibid., p. 198, or MECW, Vol. 28, p. 133. MECW, Vol. 29, p. 332. Ibid., p. 374. Ibid., p. 378. MECW, Vol. 32, p. 138. 130 chapter 4 the formal possibility of crisis) is thus the metamorphosis of the commodity itself.”8 In Capital, Chapter 3, he once again examines how, despite their independence, the “unity” of purchase and sale, “violently makes itself felt by producing – a crisis.” However: “These forms [of motion of this immanent contradiction] therefore imply the possibility of crisis, though no more than the possibility.”9 He also reformulates his thesis in the Contribution about the possibility of crisis with credit money: “There is,” he writes, “a contradiction immanent in the function of money as means of payment” between money as account or measure of value and money as means of payment. “When actual payments have to be made, money [serves] “as the individual incarnation of social labour, the independent presence of exchange value, the universal commodity.”10 Moreover, This contradiction bursts forth in that aspect of an industrial and commercial crisis which is known as a monetary crisis. Such a crisis occurs only where the ongoing chain of payments has been fully developed, along with an artificial system for settling them. Whenever there is a general disturbance of the mechanism, no matter what its cause, money suddenly and immediately changes over from its merely nominal shape, money of account, into hard cash.11 Assuming money, once obtained, could be easily spent (M – C), the main problem, he argues, lies in C – M. “Crisis results from the impossibility to sell.”12 Why might that occur? He mentions two reasons. First, a commodity may no longer find buyers, “Today, the product satisfies a social need. Tomorrow it may perhaps be expelled partly or completely from its place by a similar product.”13 Second, the person who has effected a sale and acquired money is not 8 9 10 11 12 13 Ibid., p. 140. Capital, Vol. 1, p. 209, or MECW, Vol. 35, p. 124. Capital, Vol. 1, p. 235, or MECW, Vol. 35, p. 148. Ibid., p. 236, or MECW, Vol. 35, pp. 148−149. Although focused, at this point in the text, on commercial crises, which can predate capitalism, he throws in “industrial crises,” which for him are only characteristic of capitalism. He’s getting a little ahead of the logical order of his exposition. MECW, Vol. 32, p. 139. Capital, Vol. 1, p. 201, or MECW, Vol. 35, p. 116. This is the death knell of what economists and business later called the “life cycle” of a commodity. See, Anne Sraders, “What is the Product Life Cycle? Stages and Examples,” The Street, March 4, 2019. 131 The Possibilities of Crisis compelled to buy again at once. “The outcome … [of C – M] may to begin with involve a pause … The golden chrysalis state [M] forms an independent phase in the life of the commodity, in which it can remain for a shorter or longer period.”14 In other words, individuals often opt to hold onto their money – whether from the sale of goods or of their labor-power – instead of spending it.15 2 And in Capitalism Per Se Marx then goes on to point out how capitalists face exactly the same problems as merchants because those two aspects of commodity exchange, buying, in their case M – C (LP + MP), and selling, C’ – M’, both required for capitalists to successfully gain the surplus value necessary to reproduce their operations on an expanded level, are separate in time and in space. Returning to Marx’s diagrammatic representation of the circuit of capital, we can identify three distinct stages: M — LP M — MP (1) 14 15 . . . P . . . C’ (2) C’ — M’ (3) MECW, Vol. 29, p. 328. Marx is writing about holding money in the form of cash, “larger or smaller amounts in reserve funds of coin,” or “suspended coin.” If unspent money is placed in interest earning assets, he assumes that that money will be loaned out and spent by someone else. “M – C, the second member of the circuit C – M – C, splits up into a series of purchases, which are not effected all at once but successively over a period of time, so that one part of M circulates as coin, while the other part remains at rest as money” or “hoard.” MECW, Vol. 29, pp. 360−1. And in the case of credit money: “Money has to be gradually accumulated so as to be available at definite dates in the future when payments become due.” Ibid., 379. With the development of world trade, the possibility of trade deficits, in which exports (which bring in money) are less than imports (for which money must be paid), requires the holding of money in the form of some accepted world money, e.g., the pound sterling or US dollar, or in the form of bullion or in the form of other reserves of foreign exchange. In Keynes’ analysis of the “demand for [cash] money,” he calls such holdings “trans­ actions demand,” or the holding of money for near-term spending. He also identifies a precautionary demand (holding against risk) and a speculative demand (holding against improvements in future rates of return on available financial assets). These motives hold for both businesses and individuals – at least for those with enough income to be able to hold on to some of it, a rarity among workers in the nineteenth century. See, John ­Maynard Keynes, The General Theory of Employment, Interest and Money (New York: ­Harbinger, 1965), Chapter 15 “The Psychological and Business Incentives to Liquidity.” 132 chapter 4 The first stage involving two processes, the buying of LP and MP, must obviously take place prior to the second stage, production, in which LP and MP must be combined to produce the new product C’. The third stage, the sale of that product, can equally obviously only take place after it has been created. Thus, there is an unavoidable temporal separation between the different moments.16 Each process must be carried out successfully and in the proper order for the entire circuit to be completed. Other temporal separations have also been identified in the “life of the commodity,” or product life cycles, i.e., successful new products are first conceived (born in the mind), then produced (born concretely), then sold for a profit. But if demand dwindles – say because of changing fashion or new competing products – capitalists will cut back their production. When their profitability declines enough, capitalists cease producing them at all and consign their corpses to the graveyards of the commodity world (neglected in attics, garages and closets, an exemplar or two in museums, or rusting or rotting, neglected in abandoned warehouses or landfills).17 There are also often geographical separations whose overcoming creates further possibilities of rupture. When M – LP took the form of buying the source of LP, i.e., slaves, they had to be successfully captured or bought and transported to wherever their LP could be exploited. The indenture of workers in Britain for employment in colonies generally included their passage abroad. Today’s labor market continues to include the hiring of workers in one location and their transportation to another. Raw materials produced in one location must often be successfully transported to another for processing. Finally, more generally, many commodities produced in one location are commonly sold in many other locations – which again necessitates various kinds of transportation and all the possibilities of interruption to which they are susceptible, from 16 17 The case of “futures” markets, where payment may be made before production to guarantee availability, merely reverses the temporal separation. This life cycle parallels that of both machines and employees, both of which eventually wear out and are discarded by capitalists. In Eastern Europe, after the “fall of the wall” and the opening of ex-Soviet economies to Western competition, much manufacturing machinery was left to rust in largely abandoned, uncompetitive factories. I visited one such factory in Poland, one that had built engines for big ships. Two-thirds of the place, including the machinery, stood unused and unlikely to be used in the future. Almost visible in their absence were the ghosts of all those workers hitherto employed on those machines, workers now discarded and gone from that factory. In recent years, the persistence of such attitudes helps account for employer prejudice against older workers and the latter’s charges of “agism” when 1) they are fired upon reaching a certain age and 2) when their job applications are perceived to be rejected because of their age. The Possibilities of Crisis 133 ship or train wrecks to strikes or other job actions by workers.18 Possibilities of interruption exist in all these spatial displacements of LP, MP and C’. When you realize that for Marx, transportation was a domain of production as well as essential to exchange and the functioning of markets, then such disruptions must be seen as occurring not only in M – LP, M – MP and C’ – M’, but in …P…C’ as well.19 Two of these processes are in the sphere of circulation and exchange: M – C, C’ – M’, and one in the sphere of production, … P … C’. Marx examined each of these different moments of the circuit of capital to determine possibilities of failure. Because capitalism came to maturity within a world of increasing foreign trade, these problems regularly had an international as well as local, regional and national dimensions. Given how I have argued in Chapter 3 on accumulation that the social relationships in each of these stages are those of class conflict and have insisted on the centrality of our struggles in those conflicts, in my further explorations of the possibilities of crisis in each of these three stages of the capitalist circuit, and in each element of those stages, I foreground the role of our struggles in potentially creating crisis. Certainly, Marx makes clear that workers’ struggles are not the only source of potential rupture, but from my point of view (and I believe of his too) they are ultimately the most important because they alone have the possibility not only of creating crisis but also of overthrowing the system as a whole. Please note: Marx’s theory reveals possibilities of rupture, of failure, of crisis. In what follows, I point to many of those possibilities, some of which Marx analyzed at length, some of which he ignored. Which deserve notice and how much treatment is appropriate? While his theory tells us where to look, my choices about which to include here are based on historical experiences that have revealed these possibilities to be not merely theoretical but to exist in 18 19 Shipwreck and the loss of C’, and thus M’, plays a central role in Shakespeare’s play The Merchant of Venice (1590s). In Act Three, Scene One, one of Antonio’s ships “of rich lading” is reported wrecked on the Goodwin Sands off the coast of England. Strikes by Thames lightermen in London, workers “employed in the transit of goods between wharfs and ships in the river,” caught Marx’s attention during the summer of 1853. So too did “the most important incident in this history of strikes” the declaration of the ‘Seamen’s United Friendly Association’ of the ‘Anglo-Saxon Sailor’s Bill of Rights’ against the repeal in the Navigation Acts of the requirement that at least three quarters of the seamen hired by British shippers be British. In other words, protest against the use of cheap foreign labor on British ships. See, “Rise in the Price of Corn – Cholera – Strikes – Sailors’ Movement,” August 30, 1853, MECW, Vol. 12, pp. 287−289. Capital, Vol. 2, Part I, Chapter 1, Section 1, or MECW, Vol. 36, Book II, Part I, Chapter I, ­Section I. 134 chapter 4 the world. My choices about how many words to write about them are based, partly on the extent of my knowledge and partly on my perception of their real-world importance. In footnotes, I offer many examples to convince the reader of the continuing relevance of Marx’s theory. As indicated earlier, historical examples from his time are included in the body of the text; contemporary counterparts are confined to footnotes. 3 Possibilities of Crisis in the First Stage of the Circuit: Investment As I spelled out in Chapter 3, capitalists begin their investments by gathering enough money to buy what their plans require. If successful, they must then find and enslave or hire the labor-power they need and purchase the means of production upon which their workers will be set to work. Let’s examine possible crises in each of these necessary steps. 3.1 Possible Crises in Gathering Enough Money, M With respect to the first stage of the circuit of money capital, M – C(LP, MP), the very first possibility of crisis lies in difficulties of amassing the money, M, necessary to begin the process. Marx usually assumes the availability of enough money to finance intended investment, i.e., to purchase both LP and MP. However, every capitalist faces the possibility of not being able to obtain a sufficient quantity of money and thus, a crisis avant la lettre, so to speak. In Capital, Marx gives an illustration of such a possibility from far-off Russia, where landowners, no longer able to command serfs, complain that “before the harvest is sold, the wage-labourers have to be paid a considerable amount, and the basic condition for this, a supply of ready cash, is lacking.”20 Although most workers are usually not paid until after they have worked for a week or a month, the same problem can exist for any capitalist. Without enough anticipated cash coming in to pay their workers, there is no point in hiring them.21 The same problem 20 21 Capital, Vol. 2, p. 117, or MECW, Vol. 36, p. 39. Unless, of course, the capitalist can get away with not paying them. In the nineteenth century that often happened during downturns when workers were laid off and factories closed. Today, unfortunately, within the multinational network of ever-changing patterns of capitalist investment, it still happens that plants are closed without workers being paid their most recent wages – often in response to workers organizing to form unions, but also because of the unprofitability of a particular operation due to all sorts of problems in the circuit of capital. See, Kate Bronfenbrenner, Final Report: The Effects of Plant Closing or Threat of Plant Closing on the Right of Workers to Organize, International Publications, 1, Cornell University, 1996. http://digitalcommons.ilr.cornell.edu/intl/1 Where workers are The Possibilities of Crisis 135 obtains about finding enough money to purchase the means of production, whether to get things going or to cover expected upkeep on fixed capital or to replace raw materials as they are used up. If money comes up short, investment stalls, whether it’s an initial investment by a new start-up capitalist or an investment in expansion by an existing capitalist. In his analysis of primitive accumulation in Volume 1 of Capital, Marx points out how this possibility, which had long plagued merchants, also faces would-be industrial capitalists. Both kinds of investors face the same problem of putting together enough money to buy in order to sell – for merchants to buy goods, for industrial capitalists to buy labor-power and means of production. Within on-going accumulation the availability of money for investment generally depends upon 1) retaining past surplus value in the form of money reserves, i.e., suspended coin, hoard or highly liquid assets, and 2) the ability to borrow if such savings are insufficient for the intended investment.22 Therefore, the possibility of investing and exploiting workers tomorrow is dependent on the success of investing and exploiting workers today and on access to commercial or industrial credit, i.e., the ability to convince other capitalists, banks, buyers of stocks and bonds or the government to loan money to help 22 organized and have achieved laws covering this bit of capitalist cheating, they take legal action to obtain their unpaid wages. See, https://www.workplacefairness.org/ Borrowing here should be understood broadly, not only loans from individuals or banks, but also new stock and bond offerings and loans from governments. Government financing of industrial production has sometimes taken the form of state-owned enterprises, which operate like private enterprise – seeking to maximize profits – but subject to government regulation and manipulation, e.g., having their profits drawn off through taxes to finance other state expenditures. Although rare in the US, the Tennessee Valley Authority (TVA) that produces and sells electricity is one well-known example, state enterprises have been much more common elsewhere. The most obvious cases were in Soviet-style “socialist,” or more properly “state-capitalist” countries. But they have also been created in Western Europe, e.g. Renault, the automobile company nationalized by the French government in 1945 and owned by it until privatized in 1996, in the Middle East where the governments of most OPEC countries own and manage their oil production and marketing, and elsewhere. Many such enterprises were created in ex-colonial countries where managerial talent was thought to be concentrated in the state. (Many have been privatized under neoliberal policies adopted by governments since the 1980s.) Governments have also provided outright subsidies to private industry that do not need to be repaid, either direct monetary payments or through the financing (via taxation) of infrastructure (roads, ports, dams, etc.) that reduce costs to industry and by so doing raise profits. Although relatively uncommon in the mid-nineteenth century, the more active intervention of governments in fostering investment in the twentieth century has led to the creation of all sorts of governmental agencies charged with promulgating either a particular industry or regional development. (The TVA was designed to provide such regional support as well as to produce electricity.) 136 chapter 4 (or entirely) finance proposed investment.23 The failure of current efforts at exploitation would not only mean less retained money for future investment, but would also negatively influence the willingness of others to lend in the future. Having argued the importance of foregrounding workers’ struggles in each of these stages and in each element of each stage, my first question is “how might workers’ struggles impede the ability of capitalists to muster sufficient funds for desired investment?” The most obvious response derives from how successful worker struggles can reduce work, raise wages and salaries or force their employers to spend money on other expenditures of interest to workers, such as safety equipment (e.g., guard rails around dangerous machinery or ventilation fans in textile factories and mines).24 Less work and all such expenditures raise costs and, ceteris paribus, reduce profits and thus the availability of retained earnings for investment. The second response is that such successful struggles by workers inevitably affect expectations about the future rate of profit from planned investment. Anything that lowers expected rates of profit undermines investment, both out of whatever retained earnings are available and the possibilities of borrowing money.25 Banks are notoriously averse to loaning money in risky circumstances. With rates of interest charged on loans contingent on estimations of risk, the higher those estimates, the more expensive potential credit, and the less profitable prospective investment. Indeed, opportunities can be rendered moot by rates of interest exceeding expected rates of return. The same effects can be seen in the ability of capitalists to raise money by issuing stocks or bonds: buyer perceptions of increased risk will reduce their purchases of securities and raise less money for investment. Reporting on crises of their time, Marx and Engels repeatedly pointed to the negative effects of increases in interest rates 23 24 25 See, Capital, Vol. 1, Chapter 31, or MECW, Vol. 35, Chapter XXXI. Since workers have become aware of how capitalist industries have poisoned both their workplaces and the communities in which they live, and since they have forced up wages and reduced working time to the point where they look beyond mere survival, they have also demanded expenditures on equipment to stem environmental pollution. Consistent with its past behavior, business has systematically resisted all such expenditures, complaining of reduced profits and demanding government subsidies – at taxpayer/worker expense. Years after Marx, Keynes formalized this relationship in his analysis of the effects of prospective rates of return on investment. Any decline in expected rates of return would reduce the “marginal efficiency of capital,” with the effect of reducing investment at each rate of interest; conversely, any rise in expected rates of return would likely increase investment. See, The General Theory, Chapter 11. The Possibilities of Crisis 137 on investment and thus on the usefulness of financial markets to raise money for investment. Similar considerations are taken into account by government policy makers, be they kings or legislators, in deciding whether to subsidize investment, either by the state itself or through loans or subsidies to private investors. Here again the reaction to upsurges in worker struggles, especially if on a large scale and affecting expectations across industries, may be to spend money on police and military repression while putting off expenditures on investment.26 Workers’ struggles, however, are by no means the only determinant of interest rates and thus the availability of credit for investment, be it from private money markets or government. Despite holding a theory that the supply of money is ultimately determined endogenously by the value of commodities in circulation, Marx nevertheless recognized how central banks repeatedly changed the interest rates they charged to influence the amount of money in circulation. For example, central banks would raise interest rates to maintain ties between their issuance of notes and their bullion reserves. With gold and silver the basis of money throughout Europe and Asia, the transference of bullion and thus the flow of investable money capital were sensitive to differences in interest rates – flowing away from lower rates and towards higher rates. Recognition of this sensitivity repeatedly led central banks to raise their rates in competition with one another to stem capital export and had the result of circulating crisis.27 In 1856, Marx analyzed such competition between the Bank of England, the Bank of France, German banks and those elsewhere on the continent. Complicating those relationships were the increasing drains 26 27 In extreme situations, however, we see both, designed to complement each other. Such was the US reaction to the upsurge in workers struggles during and after WWII in Europe where communists and their political parties played a major role in resistance to fascism. That gave them credibility and electoral strength in the post-war period. So, the Marshall Plan subsidized reinvestment in Europe, supporting capitalists, while more covert methods were used to counter communist party efforts to strengthen their influence in unions and to gain political power in France and Italy. Such complementary methods became frequent during various post-war counterinsurgency campaigns in Southeast Asia and elsewhere in the Global South where “civic action,” including investment, was designed to complement the military repression of insurgents. It continues to this day in places such as Chiapas, Mexico where government military and paramilitary methods of repressing indigenous autonomy have been complemented by various “mega [investment] projects” such as government subsidized rail lines and tourist development. Marx, K., “The Vienna Note – The US and Europe – Letters from Shumla – Peel’s Bank Act,” (Sept. 9, 1953) MECW, Vol. 12, pp. 292−300. Marx to Engels, 3 Feb. 1851, MECW, Vol. 38, pp. 273−278, 138 chapter 4 of silver to China and India.28 He saw all these monetary problems aggravating the emerging crisis whose seriousness was already predictable for other reasons. Whatever may be the temporary cause of the monetary panic, and the drain of bullion which appears as its immediate occasion, all the elements of commercial and industrial revulsion were ripe in Europe …29 One locus of such “ripeness” upon which Marx dwelt at length was France, where huge speculations in railroads were complemented by disasters in, and new taxes on, agriculture, “the dearth of lodgings and provisions in Paris, the pressure on the retail trade of the capital, [and] the strikes in different branches of Parisian industry …”30 In the case of both private banks and public lenders the cost of borrowing may entail not only interest but also all sorts of conditions that the borrowers much meet. In the case of private banks, the most obvious conditions are those for collateral, specified patterns of repayment and fines for failure to meet those obligations. In the case of public lenders, you have conditions placed on central banks by governments, e.g., Peel’s Bank Act of 1844, and by central banks on other banks, e.g., reserve requirements, and on foreign central banks and governments.31 Whatever the source, the terms of borrowing must 28 29 30 31 See “The Causes of the Monetary Crisis in Europe,” (circa October 14, 1856) MECW, Vol. 15, pp. 117−122, “The Monetary Crisis in Europe -- From the History of Money Circulation,” (circa October 17, 1856) MECW, Vol. 15, pp. 123−129, and “The Economic Crisis in France,” (circa November 7, 1856) MECW, Vol. 15, pp. 130−135. Today, “hot money” investors in liquid financial assets are known to flee open capital markets in response to perceptions of increased risk. One of many modern examples was the 1994 currency crisis in Mexico when increasing political instability in the wake of the Zapatista uprising in January of that year let to flight from the peso and its dramatic devaluation. (More on this in Chapter 5, footnote 5.) Not only did that flight reduce the available funds for investment, but the subsequent imposition of high interest rates to stem the outflow undermined availability even more, bringing on a broader crisis – and more political turmoil. MECW, Vol. 15, p. 122. “The Economic Crisis in France,” MECW, Vol. 15, pp. 134−5. Over time Marxist studies of relationships between banks and non-financial industry have evolved considerably. I have already mentioned Hilferding’s Finance Capital and Sweezy’ counter argument. In more recent years, the spread of financialization has renewed interest in the relative power of financial institutions versus industrial, agricultural or service industries – including the intellectual followers of Sweezy who make up the “Monthly Review” school of neo-Marxism. See, “Decoding Financialization” in Cleaver, Rupturing the Dialectic, for a sketch of this evolution. In the case of modern, supranational lenders to governments, e.g., the World Bank or International Monetary Fund, conditions The Possibilities of Crisis 139 be weighed by the potential investor and creditors against anticipated profits – which must be great enough to repay the costs of borrowing and leave a net profit sufficient to make the investment worthwhile. Any increase in the costs of borrowing reduces net profits and the willingness of the investor to borrow. The possibility of being unable either to earn or to borrow sufficient funds to finance a desired investment increases dramatically amid an economic crisis. Potential investors’ possibilities of earning the money they need to invest may be reduced by their own inability to sell. More generally, commercial crises (involving generalized ruptures in C’ – M’) bring on monetary crises in which the rate of interest charged by lenders rises rapidly as all kinds of firms – industrial, commercial, and financial – become desperate for cash and loath to loan in anticipation of their own needs, thus aggravating industrial crises. Moreover, there are a number of possibilities of crisis for would-be investors associated with changes in the value of their money holdings. First, money in the hands of investors may become debased to the point of being unacceptable to those from whom they desire to buy, e.g., raw materials. Besides inevitable wear and abrasion of coin in circulation, the debasement of metal money generally had three sources: (1) governments reducing the percentage of gold or silver in coins to stretch the “value” of precious metal on hand, (2) the private clipping of coins that reduced the amount of metal (and thus their value) and (3) out and out counterfeiting. In the Contribution to the Critique, Marx points to the “little shilling men,” who advocated repayment of government debt in debased shillings as a solution to currency problems.32 John Locke, while serving in the Mint, took the threat to British trade of debasement of the pound sterling so seriously that he called for recoinage – despite fears that it might result in deflation at a time when the country could ill afford it.33 Two, somewhat similar, problems may arise with metal-based monies from reductions in the value of the metal serving as money or from bimetallism in those periods in which gold and silver both serve as money. In the first case, the resulting price increases would reduce the buying power of whatever money is available for investment. In the second case, if the value of one metal falls in 32 33 for their loans and for signing off on the roll-over of private international debt, have included devaluations of local currencies, reductions in subsidies for basic consumption, ­privatization of state enterprises, etc. See Cleaver, “Close the IMF, Abolish Debt and End ­Development,” op. cit. MECW, Vol. 29, p. 319. The British pound sterling coin was divided into 20 shillings (smaller coins) – a monetary unit which was abandoned in 1991 in the UK but continues to be used in several countries in East Africa. See, George Caffentzis, Clipped Coins, Abused Words and Civil Government: John Locke’s Philosophy of Money (New York: Autonomedia, 1989). 140 chapter 4 relation to the other, it is less able to serve its owner as money and is likely to be driven from circulation. In both cases, would-be capitalist investors unfortunate enough to be holding their money in the devalued metal would discover their ability to purchase labor-power and the means of production impaired. A final problem, one of increasing importance in the nineteenth century with the rise of joint-stock companies, was the diversion of money from real investment, i.e., spending money on LP and MP to increase production, to speculation. i.e., money spent by individuals or firms that does nothing to increase production. Unfortunately, the word “investment” is commonly used to refer both to real investment and to speculative expenditures of money on existing assets whose prices are expected (or hoped) to rise, assets such as already issued stocks and bonds or existing supplies of housing or raw materials.34 We must differentiate speculative spending on existing stocks and bonds from purchases of new offerings of stocks and bonds being issued to raise money for actual real investment. Investing in new production involves speculation but only in the limited sense that future outcomes cannot be known with certainty. Let us now turn from the problem of having enough money to those potential crises that can emerge as capitalists try to obtain the LP and MP required in their investments. Assuming enough money has been found to fund the intended investment, there can still be crises associated with the availability of LP in labor markets and the availability of MP from other capitalists. In their economic models, economists treat scarcity as easily resolvable through changes in prices with changes determined by supply and demand. In the case of LP, they assume excess demand will raise the price of slaves or the wages of hired workers with the result that slavers will capture more workers or waged workers will have a greater willingness to sacrifice leisure and work more, or more workers will be drawn into the labor market from the “reserve army.”35 If more MP is needed than is currently available, i.e., the amount 34 35 The likelihood of money being diverted into speculation depends on a host of factors, although in recent decades the primary one has been financial deregulation which has made it easier to divert all sorts of money into speculation, most notably in housing and in financial assets. Thus, contemporary microeconomists’ general assumption of upward sloping supply curves of labor derived from personal preferences about mixes of income (and what it buys) and work (a loss of leisure). Not being completely oblivious to the implications of recognizing leisure as desirable and work as undesirable, economists sometimes remember that if wages rise high enough the supply curve of labor curves back to the left reflecting the choice (when available) to work less to take advantage of the opportunities provided by higher income! In typical introductory microeconomic textbooks, however, such “backward bending” labor supply curves are ignored, despite the way they provide one explanation for why capitalists try to keep wages below the point at which less work The Possibilities of Crisis 141 demanded exceeds the amount supplied, they assume the excess demand will raise prices and more will be forthcoming from producers of MP in response to higher prices. Such corrections, economists reason, will happen quickly and smoothly so any marginal difficulty in obtaining enough LP or MP will be quickly corrected. Marx and Engels, on the other hand, saw lots of cases where no such smooth, marginal adjustments took place, but instead corrections came in the form of serious disruptions and crises. After all, from the point of view of investors, when scarcity results in higher prices, their money buys less LP and/or MP. Given existing financing, in the short-term rising costs of LP and MP will immediately reduce the amount of investment and accumulation. If the prices of either labor-power or the means of production, or both, rise so high as to make earning an acceptable rate of profit unfeasible, capitalists will not invest at all. The result is, effectively, the same as a total unavailability of the required resources and the resulting impossibility of either beginning or renewing circuits. If this unfolds on a large scale the results can be dramatic. 3.2 Possible Crises in Obtaining Labor-Power Because within capitalism, labor is imposed, whether by slavery or through the not so “free” labor market, people resist and often revolt causing crises in the supply of labor-power. As a result, its availability is never guaranteed. Both slaves and waged workers, whom Marx often referred to as “wage-slaves”, drawing a parallel with their enslaved counterparts, have struggled against that imposition and the resulting alienation. The mechanisms of coercion differed but the objective was the same – control and exploitation – and both kinds of workers have fought back. 3.2.1 Possible Crises in Obtaining Slaves Since the rise of capitalism, capitalists have deployed several methods to obtain slaves, either as chattel property or as forced labor. Thanks to the resistance of those enslaved, each method has been subject to crises. The first, historically dominant method, when chattel property in people was legal, was capture and sale – “the slave trade.” This included the Atlantic will be desired and chosen (when possible) to maintain adequate supplies of labor. The backward bend (becoming downward sloped) was first recognized by economists studying colonial labor markets where the colonized did NOT want to work for their colonizers and did so only to pay required taxes in colonial monies that could only be earned by working for the invading foreign capitalists. THEIR labor supply curves were thus downward sloped from the get-go. The lower the wages the more they had to work to pay taxes. 142 chapter 4 slave trade that furnished enslaved Africans to slave markets in Europe and the Western Hemisphere.36 It was called “the slave trade” because it was mostly carried on by private capitalists, albeit often with the help and protection of governments. Against this trade, not only did people resist slavers, but those who failed and found themselves enslaved continued to resist, sometimes passively, denying their energy and creativity to their owners, sometimes through revolt or the organization of escape, e.g., the flight to freedom either in hidden Maroon colonies in the hinterland or through underground railroads to places where slavery was illegal.37 Success in such endeavors increased the difficulty of obtaining as well as retaining slaves. Slave resistance has also been supported by many abolitionists who have opposed slavery on various ethical or moral grounds. The revolt of the former directly deprived their owners of their LP; opposition of the latter demanded an end to both the slave trade, which would reduce the number of slaves, and to chattel slavery tout court, which would eliminate the ability of capitalists to employ slaves legally. The second method has been the imposition of forced labor on workers found guilty of crimes and either put to work by the managers of governments’ prison systems or farmed out to private capitalists. In Marx and Engels’ time, Britain was notorious for “transporting” prisoners – especially condemned ­militants – to places like Australia and New Zealand for forced labor. Within the US, penal forced labor persisted thanks to the Thirteenth Amendment to the US Constitution that made chattel slavery illegal but legalized forced labor in prisons “as a punishment for crime whereof the party shall have been 36 37 The capture and trade in slaves in the nineteenth century was by no means limited to the Atlantic. Non-Muslim Europeans captured by pirates were enslaved, sold and bought along the North African “Barbary Coast.” The slave trade was also rampant within Africa and in many parts of Asia. Escaped slaves formed Maroon colonies throughout the Americas, from those in the swamps of Florida to the forests and plains of South America. These colonies often interacted with and sometimes merged with indigenous communities. Underground railroads, on the other hand, usually led to the relative freedom of waged labor markets. See, Richard Price, Maroon Societies: Rebel Slave Communities in the Americas, 3rd edn. (­Baltimore, MD: Johns Hopkins University Press, 1996), Robert Schwaller, African Maroons in the Sixteenth Century Panama: A History in Documents (Norman: University of Oklahoma Press, 2021) and Maroon Comix: Origins and Destinies (Oakland: PM Press, 2018). On the underground railroad, see, Eric Foner, Gateway to Freedom: The Hidden History of the Underground Railroad (New York: W.W. Norton & Company, 2015) and the film Harriet (2019) about the struggles of escaped slave and abolitionist Harriet Tubman (1822−1913). In today’s world, “underground railroads” consist mostly of organizations that help escaping slaves by providing temporary refuge and then legal support. The Possibilities of Crisis 143 duly convicted.” Here too, many of those forced to work have resisted, either passively or actively by striking or escaping. As in the opposition to chattel slavery, resisting prisoners have received help from outside groups opposed to this form of legal quasi-slavery. The third method of obtaining slaves has been to breed them, i.e., enslave the children of existing slaves. This became the sole remaining method after the slave trade was made illegal, ending only with the outlawing of chattel ­slavery. Here too, there was resistance, especially by enslaved women who secretly used home remedies to avoid pregnancy or to abort, denying new slaves to their owners. (See, Chapter 5, Section 1.2.3.3.) 3.2.2 Possible Crises of Hiring in the Labor Market, M – LP Of these two markets, M – LP and M – MP, I begin with M – LP, rather than M – MP, because the labor market is the first of the two moments of the capitalist circuit where capitalists and waged workers come face to face and where the intrinsic antagonism of the class relationship is clearly manifested. (The second moment of confrontation, of course, is production, …P….) In ­Volume 2 of Capital, Marx was quite explicit about the centrality of M – LP. M – L is the characteristic moment of the transformation of money capital into productive capital, for it is the essential condition without which the value advanced in the money form cannot readily be transformed into capital, into value-producing surplus value. M - mp is necessary only in order to realize the mass of labour bought by way of M – L.38 The “essentiality” of M – LP is not only because workers are required to generate surplus value, but also because this subordination of people to work is the fundamental basis of capitalism as a functioning social system. The “means of production” are, socially speaking, merely the means of imposing work. This is true whether in the case of the dominant form of imposing work – the wage relation – or in the secondary form of slavery. Marx writes, The class relation between capitalist and wage-labourer is thus already present, already presupposed, the moment that the two confront each other in the act M – L (L – M from the side of the worker).39 38 39 Capital, Vol. 2, p. 113, or MECW, Vol. 36, p. 35. Ibid., p. 115, or MECW, Vol. 36, p. 37. 144 chapter 4 But the same is true in the case of slavery within capitalism. In both cases, the class relation being imposed involved peoples’ lives being subordinated to the production of commodities. And that “class relation” is one of struggle between those whose control of MP gives them the power to impose work and those whose lack of such control puts pressure on them to submit to it. In the case of M – LP, the possible sources of crisis faced by capitalists are first, not being able to buy enough LP and second, not being able to buy it at a price that will make putting it to work profitable. This holds whether the LP being purchased is “free” (waged) or slave.40 In other words, there are too few workers to hire or slaves to be bought or the wages of the one or the cost of the other might be too high. This possibility has existed in every labor market where capitalists buy LP. In Marx’s theory we speak of the labor market, but there have always been many segmented labor markets, differentiated by industry and skill, but also by gender, ethnicity and race and corresponding pay scales. Women have been treated differently than men, relegated to particular jobs and generally paid less. There have been Men’s jobs and Women’s jobs. The same has been true with ethnic and racial minorities. Not only were the Irish pitted against the English (and vice versa) in nineteenth century Britain but the Irish were admitted only to labor markets for the worst, lowest paying jobs.41 The “payment” of slaves, of course, generally in kind, room and board, has generally been much less than waged and salaried workers.42 Once chattel slavery was abolished in the United States, Jim Crow laws created segregated labor markets in which Blacks could only apply (with any reasonable expectation of being seriously considered) for some jobs, generally low paid, but not others. There have been White jobs and Black jobs.43 This segmentation was recreated throughout 40 41 42 43 In the case of chattel slavery, capitalists buy humans for their LP, extracted by force or manipulation. In the case of human trafficking, some capitalists pretend to hire workers but then force them to work as slaves, e.g., in the case of immigrants, withholding passports, whether in homes and brothels, agricultural fields, sweat shops, fishing boats or prisons. I take up the problems of capitalists trying to sell LP in the form of slaves in Section 5.1. The same, of course, was true when millions of them emigrated to the United States. The same was true in those cases where slave owners put their slaves out to work in waged jobs. Not only were they paid less but most of their pay went to their owners. On waged slaves in pre-Civil War southern industrialization, see: Robert Starobin, Industrial Slavery in the Old South (Oxford: Oxford University Press, 1970) and Klas Rönnbäck, “Were slaves cheap laborers? A Comparative study of labor costs in the antebellum U.S. South”, Labor History 62 (2021): 721−741. For a vivid contemporary example, see Charlie LeDuff, “At a Slaughterhouse, Some Things Never Die: Who Kills, Who Cuts, Who Bosses Can Depend on Race”, The New York Times, (June 16, 2000): A1-A24. The Possibilities of Crisis 145 society – in the segregation of schools by race, and in the redlining of urban spaces, which confined minorities to specific ghettos. In the world of colonialism, such discrimination among local ethnic and linguistic groups was ­rampant – and one source of the struggle for national liberation. Within all of these carefully constructed, segmented markets for waged and salaried workers, employers have been able to fire their employees “at will” – just as slave owners can sell their slaves whenever they have needed to do so. Firing has often been done unceremoniously, by company goons forcibly escorting workers off the grounds of their job.44 This has been the fate of individuals or, sometimes, of all workers when companies have shut down operations for whatever reason – from cutbacks in production or bankruptcies during crises to lockouts during contract negotiations (once workers achieved the power to impose collective bargaining).45 The problem of finding enough workers in any of these differentiated labor markets and at profitable cost has been endemic to capitalism for a variety of reasons. In the case of potentially waged workers, their availability depends on a number of factors: their willingness to enter the labor market at all, flight from labor markets, disease and starvation, military drains and reduced or slowed population growth. 3.2.2.1 Avoidance of the Labor Market Because waged and salaried jobs are shaped by capitalism’s efforts control life, making them exploitative and alienating, folks of all ages often try to avoid them. And avoiding jobs means avoiding the labor market – that portal to the heart of capitalism’s hell-on-earth. When young, still curious about the world, well-fed, and left on their own, kids are often more into exploring the world than accepting the difficulties and discipline with which they see their parents and older people struggling. When older, a surprisingly large number of adults still opt out of the labor market and choose some alternative way to survive. Eventually, for those who have chosen to work for wages or salaries, 44 45 The word “goon” comes from South Asia and the Hindu word guṇḍā or goonda – defined in both the vernacular and law (Goonda Acts) as a hired criminal, or a hired hand who engages in criminal behavior. They can be found in the hire of large landlords, merchants and industrial capitalists and the term with its derogatory connotations has been widely applied by workers to company thugs. Today, in the United States, the “pink slip,” the surprise order to leave everything behind except personal items, followed by the escort to the front door (or gate) have been so common as to constitute despised ceremonies of termination. In some European countries, better organized workers have won protection from such arbitrary termination with employers obligated to notify their workers ahead of time and, in a few cases, provide assistance in finding new jobs. 146 chapter 4 accumulated fatigue, ill-health or a sense of justice after a lifetime of work drive those who can afford it to retire from whatever jobs have dominated their adult lives and eschew any further engagement with the labor market. Let’s survey such avoidance in various situations and stages of life during Marx and Engels’ lifetimes. Avoidance among not-yet-disciplined youth seems endemic and can be found in every segment of the income hierarchy, from its upper echelons down to its most poverty-stricken segments. In the nineteenth century, well-to-do families in capital’s new income hierarchy often emulated earlier practices of the landed gentry by allowing their children to put off entering the job market, first by “schooling”, usually by tutors for boys and governesses for girls, then by taking parent-financed tours abroad (mostly boys), for fun, to widen their horizons, to improve their language skills and to prepare them for future leadership roles in capitalist society. Among the emerging middle-class, where family income has allowed, their youth often followed the same path, partly emulating their upper-class counterparts, partly just avoiding the job market and work.46 In both cases, young adults have indulged their natural propensity to avoid knuckling down to the discipline of doing what someone else tells them to do. The situation for the children of working-class families, in both countryside and cities, and those born into circumstances that Marx and Engels would classify as lumpenproletariat, faced more dire futures and much greater pressure to set aside their natural propensity to explore life and instead find some kind of work to supplement family income. Thus, that “selling into slavery” of children by some working-class families struggling to survive. Where even that proved impossible, children and young adults have often organized themselves into collectives (gangs) – operating within the “informal economy”, frequently in ways disruptive of the usual operations of businesses. A few, among children of all sorts, have formed politically active, militant groups, some to challenge 46 The poets and writers of the Beat Generation in the 1950s inspired many to follow Jack Kerouac On the Road (1957) but only as a temporary escape from the labor market. I became personally familiar with many such students in the early 1960s because while an undergraduate studying in France, I spent some time sleeping under the bridges of Paris, eating at soup kitchens, and hanging out with other students taking time away from both studies and the job market. A decade later, the 1960s saw an explosion of youthful resistance to the job market by a generation of “hippies” and “radicals”, critical of capital’s subordination of life to work with the accumulation of stuff as the only consolation. The Possibilities of Crisis 147 the structures of their society, some to organize countermeasures to the poverty and repression of their communities.47 But for adults, avoiding the labor market, refusing to hire out to some employer, has never been easy because of the way capitalists have monopolized the means of livelihood, land, tools, etc. Nevertheless, many have avoided and have found alternative ways to survive. Here, I’ll highlight two common alternatives. First, among the expropriated, those with either no interest in regaining access to land or judging it impossible, have often chosen to move outside both traditional norms and capitalist laws doing whatever they could to live. Second, where enclosure has not been complete, both during the rise of capitalism or later, on its not-yet-enclosed margins, many have fought to either retain their access to land for subsistence agriculture or, having lost it in one place sought it elsewhere. Thus, the resistance to enclosure and later efforts to reverse it. (See below, Chapter 4, Section 5.2.2.1.) Among those who, once deprived of land, abandoned any effort to regain it, were the beggars, vagabonds and robbers cited by Marx on the first page of Chapter 28 of Capital. With his emphasis on the cruelty of expropriation, his account emphasizes how they were forced out of their traditional roles and livelihoods. Studies by bottom-up historians provide examples of adaptation, such as Edward Thompson’s Whigs and Hunters: the Origin of the Black Act (1975) that sketches the complex modes of survival via squatting, farming and poaching of displaced yet creative people in and around the forests of England, and Peter Linebaugh’s London Hanged that shows how, as capitalism took over the slaughter of animals, many displaced butchers who lost their livelihood turned to robbery.48 Many other accounts have studied how some chose to continue living outside the labor markets capital sought to impose. The book London Labor and the London Poor (1851) by Henry Mayhew (1812−1887), based on interviews with vagrants, contains lots of stories of how and why they chose uncertain lives on the streets, highways, and byways of England rather than submit to the discipline of the job, any job. For those unacquainted with life on 47 48 The decision by some middleclass students to avoid entering the labor market by spending some time on the streets or traveling has been common enough but hardly a cause of crisis. In the 1960s, in the context of the Civil Rights Movement at home and of the Vietnam war, we saw the emergence of radical militants among both students and non-students. These included anti-war groups such as Students for a Democratic Society and militant groups such as the Black Panthers and the Brown Berets. In all these cases, participation in the labor force was minimal and designed to support struggles outside it. Edward Thompson, Whigs and Hunters: the Origin of the Black Act (, 1975), Peter Linebaugh, The London Hanged, Chapter Six: ‘Going upon the Accompt: Highway Robbery under the Reigns of the Georges.” 148 chapter 4 the streets, who tend to see only the hardships, such stories provide insight not only into the variety of ways vagabonds have foraged both society and nature but also, though it may seem strange, the pleasures of freedom they sometimes enjoy. Those who were once peasants used their agrarian skills to live off the land – foraging plants and poaching game – as well as begging and pilfering in towns. Although those accounts, especially fictionalized ones, often focus on individuals, such deracinés have often united to form collectives, such as the seventeenth century kingdom of vagabonds in Paris, which Marx mentions in Capital.49 Success at staying free from the labor market and from being exploited by some capitalist, despite being criminalized and harshly punished, has long had an appeal to those less successful at avoidance. John Garraty has reported on how French workers harassed cops arresting beggars; Eric Hobsbawm has suggested how exploits of unwaged “social bandits” appeal to the exploited and explain the persistent popularity of the frequently sympathetic portrayals not only of beggars and vagabonds but also of robbers.50 Think, for example, of the many tales of the English outlaw Robin Hood, or the orphan Oliver Twist in Charles Dicken’s novel of that title (1837−1839), or the hero of Victor Hugo’s Les Miserables (1862), who wends his way through much of the story as a vagabond. Or, the 1901 novel If I Were King, its 1925 adaption as an operetta The Vagabond King, and subsequent film versions, all based on the romanticized adventures of the fifteenth century outlaw and poet Francois Villon.51 Although bottom-up historians have sometimes retrieved stories of how communities of exploited workers have formed networks of mutual aid and collaboration to better cope with their situations, less study has been done on collectivities among the “lumpenproletariat”, frequently dismissed as irrelevant to class struggle, even by Marx and Engels who perceived a lack of class consciousness and how the lumpen had sometimes been used against waged workers. In the Communist Manifesto, they write: The “dangerous class” [lumpen proletariat], the social scum, that passively rotting mass thrown off by the lowest layers of old society may, here and there, be swept into the movement by a proletarian revolution; 49 50 51 Capital, Vol. 1, p. 899, or MECW, Vol. 35, p. 726. John Garraty, Unemployment in History (New York: Harper Colophon, 1978) 25. Eric Hobsbawm, Primitive Rebels: Studies in Archaic Forms of Social Movements in the 19th and 20th Century (New York: W. W. Norton, 1959) Chapter II. Films based on adaptations of the original novel were made in 1920 (silent), 1930 (musical), 1938 (historical), and 1956 (1930 remake), this recurrence a testimony to the appeal of the story. The Possibilities of Crisis 149 its conditions of life, however, prepare it far more for the part of a bribed tool of reactionary intrigue.52 This view was reinforced by observing how some of the lumpen were m ­ obilized to help put down workers’ revolts in 1848. Still seeing the lumpen as disorganized “social scum”, in the Eighteenth Brumaire (1851−2), Marx and Engels failed to study any of those they lumped into the lumpen other than those at the highest levels of capitalist power and corruption, e.g., Napoleon III, who Marx deemed the “Chief of the Paris Lumpenproletariat”, or those organized by them, e.g., the Society of December 10.53 Yet, the “lumpen” were not always a chaotic assembly of isolated, self-­ serving individuals, easily manipulated by the powers that be. Beggars, vagabonds and robbers often grouped and struggled collectively. Robin Hood, after all, had his band of “merry men” operating out of Sherwood Forest. The later deer-stealing “Blacks” (Thompson’s “hunters”) of Windsor Forest were also often well organized, albeit with guns rather than bows and arrows. Oliver Twist hooked up with a gang of pickpockets working the streets of London and the “vagabond king” was king of a well-organized underground of all sorts of “lumpen.” Exceptions to this neglect among historians who have studied the period leading up to and including Marx and Engel’s nineteenth century are Eric Hobsbawm in his Primitive Rebels (1959), the authors of Albion’s Fatal Tree: Crime and Society in Eighteenth-Century England (1975), including E. P. Thompson and Peter Linebaugh, also author of The London Hanged: Crime and Civil Society in the Eighteenth Century (1991), based on biographies of workers executed at the Tyburn gallows, Marcus Rediker, who has analyzed pirate communities on ships and on shore in Villains of All Nations: Atlantic Pirates in the Golden Age (2004) and Linebaugh and Rediker, who collaborated to write The Many-Headed Hydra: Sailors, Slaves, Commoners, and the Hidden History of the Revolutionary Atlantic (2000).54 52 53 54 “MECW, Vol. 6, p. 494. Marx and Engels’ dismissal differed radically from the view of contemporary anarchists, such as Max Stirner or Mikhail Bakunin whose embrace of lumpen rebellion earned him Engels’ nickname “the lumpen prince.” MECW, Vol. 11, pp. 148−149, 155. In the post-WWII period, some Marxists turned their backs on what they took to be a sold-out, consumerist, industrial proletariat, modern versions of what Engels had called the “labor aristocracy” of better paid, unionized workers. They turned their attention at home to re-evaluating the revolutionary potential of the lumpen and abroad to struggles on what they often called the Third World “periphery” of global capitalism. The result was both a failure to thoroughly analyze the hierarchy within the former countries – as Marx had done in Capital – and a tendency to glorify workers struggles in the latter – a 150 chapter 4 Turning from those who abandoned the land, we enter the diverse world of farmers and peasants, often dislocated but often equally engaged in fierce struggle to hang on to or regain land and the subsistence it makes possible. Just as local farmers located near developing capitalism were threatened by enclosure, like those in Great Britain analyzed by Marx, so too were agriculturalists in colonized areas, who saw their best lands taken over by invading foreigners, and indigenous peoples on the frontiers of capitalist expansion, who had lived by hunting, gathering, and agriculture for thousands of years. Whereas agriculturalists were often familiar with exploitation by local precapitalist or emerging capitalist elites, indigenous peoples often had neither familiarity with nor understanding of labor markets. Nor did they – initially – have any need for wages.55 Like gauchos who fled the labor market and often lived with them, indigenous peoples mostly continued apart from this new institution and refused to have anything to do with it. The attachment of peasants to the land and their struggles to maintain their access to it has limited their availability to capitalists seeking to hire.56 In discussing this problem, Marx cited the complaint of Russian landowners about difficulties in obtaining sufficient and timely wage-labor. Despite being freed from serfdom, he writes: the Russian agricultural worker, owing to the common ownership of the soil by the village community, is not yet fully separated from his means of production and is thus still not a ‘free wage-labourer’ in the full sense of the term.57 55 56 57 tendency sometimes called “Third Worldism.” Among those fascinated with the former were Herbert Marcuse and among those who revived the concept in Global South was Franz Fanon. The formation of groups such as the Black Panthers and the Young Lords whose militance included organizing in their communities gave some credence to such preoccupations in the US. The widespread rebellions in Asia, Latin America and Africa, against which the US and European powers mustered counterinsurgency wars, gave hope and prompted solidarity among those dismissing the “labor aristocracy” of the North. Eventually, barter trade with European colonizers would create enough of a demand for industrialized goods to induce some indigenous to enter the labor market to obtain money to buy them. See Section 3.4.1 below. The degree of unavailability has varied according to circumstances. Under normal growing conditions, sufficient subsistence renders recourse to the labor market for income unnecessary. Although, in peasant communities, some may temporarily hire out to neighbors during harvests. Drought, flood, and famine, however, often drive reluctant but desperate peasants to seek employment and wages. Capital, Vol. 2, p. 117, or MECW, Vol. 36, p. 40. This failure to totally separate workers from the means of subsistence persists in the recourse of even regularly employed waged or salaried workers to gardening or some subsistence farming. This is common in the Global South The Possibilities of Crisis 151 “Not yet separated” means they still had access to lands they knew full well how to cultivate and on the basis of which they could live their lives independently of big landowners. The same problem confronted Jamaican plantation owners once their slaves were freed. Marx writes: They have ceased to be slaves, but not in order to become wage labourers, but instead, self-sustaining peasants working for their own consumption.58 It is worth remembering that in the nineteenth century, many peasants, even when forced off the land carried living memories of different and often preferred lives in agricultural communities (such as the Russian mir, or peasant commune) and yearned after restitution or some new access to land, somewhere else.59 After the American Civil War, the situation of ex-slaves paralleled that of the Jamaican and Russian cases. Mostly agriculturists by skill, however forced it had been, many wanted “forty acres and a mule” to continue working the 58 59 where even those driven from their rural lands make use of any unbuilt ground in cities to grow food, e.g., the common milpa or corn patch in Mexico. The practice has been spreading in cities in the Global North, often in immigrant communities and with the blessings of ecologists. See, Chris Carlsson, Nowtopia: How Pirate Programmers, Outlaw Bicyclists, and Vacant-Lot Gardeners are Inventing the Future Today! (Oakland: AK Press, 2008) and Gabriel Valle, “Food Values: Urban Kitchen Gardens and Working-Class ­Subjectivity,” in Mexican-Origin Foods, Foodways and Social Movements: Decolonial Perspectives, Devon Peña et al., eds., (Fayetteville: University of Arkansas Press, 2017), 41−61. Where collectivization has been imposed, as in the USSR, to maximize grain production for export to finance rapid industrialization, the intentional allocation of small subsistence plots of ground to workers on collective and state farms proved a serious mistake. With production on state-organized farms of no use to them, workers tended to plow much of their effort into their private plots. This not only provided subsistence but often produced a surplus which was traded in the countryside or sold in cities. The higher productivity of labor on these private plots was well-known and was the direct result of the withdrawal of efficiency from state exploitation and its application to self-valorization. Grundrisse, p. 326, or MECW, Vol 28, p. 251. Teodor Shanin argues that first generation rural-urban migrants in Russia were responsible for setting up the soviets during the Russian revolution. They were, he argues, replicating in their factories and cities organizations akin to the communes they had known in the countryside. Over time, emigrants’ children constitute a “second generation” with no memories of the land and with an entirely different set of desires and, often, with much less willingness to put up with low wages and lousy jobs. Such children, of whatever age, have often spearheaded uprisings in immigrant communities. See, Yann Moulier-Boutang, La Révolte des Banlieues ou Les Habits Nus de la République (Paris: Éditions Amsterdam, 2005). 152 chapter 4 land – preferably taken from the plantations where they had been working. When Reconstruction (1865−1877) failed to expropriate and redistribute the land of treasonous plantation owners, their one-time slaves resisted returning to the plantations under the low wage, near-slave conditions on offer. Some hit the road forming a mass of unemployed workers – a mass so threatening that the white supremacists who retook power passed and enforced anti-­vagrancy laws to control them. Some succeeded in collectively obtaining land to found Freedmen’s or Black Towns. Others negotiated sharecropping contracts to get access to land. While sharecropping turned out to involve other forms of un-waged exploitation, including debt peonage, it did provide an alternative to the labor market and reduced the availability of potential waged workers.60 The ability to avoid the labor market in old age depends on sources of income. Those higher up the waged/salaried hierarchy could save, either in banks or by buying bonds that generate income, independent of current salaries. The further down that hierarchy, the lower the income, the harder to save – to the point of impossibility. For the low-paid workers whose struggles were the focus of Marx and Engels’ studies and political organizing, almost the only source of support in old age was the extended family – where the no-longer employed old lived with and helped their children and grandchildren – and community networks of mutual aid. But both the extended family and community networks have been repeatedly torn apart by the exodus of those following, rather than avoiding the job market. The closing of a mill or mine could mean not only the loss of jobs, but the need of the newly jobless to move elsewhere to find new ones. While such movement was sometimes from one local job to another, it also, all too often involved major geographic displacement, including immigration to other countries, e.g., those repeated waves of European immigration that populated the Western Hemisphere, while displacing the indigenous. That malleability of labor supply so vital to capitalist repeated self-reorganization has always undermined the ability of 60 C. Vann Woodward, Origins of the New South, 1817−1913 (Baton Rouge: Louisiana State University Press, 1951). The “Freedmen’s Towns” were not the hidden maroon colonies founded by escaped slaves, but simply communities of African-Americans with ­similar background. Often originally on the edge of cities, which have eventually expanded around them, many of those living in such Black communities sought, to the degree that persistent racism allowed, integration into the waged labor force. Over time, such ­communities have often been at least partially destroyed by the land being usurped through “eminent domain” for such “public improvements” as highways or eroded through gentrification. The Possibilities of Crisis 153 families and communities to hold together and provide security for both those no longer able to work and those fed up with it wanting to retire permanently.61 3.2.2.2 Flight from the Labor Market Many are the ways waged workers have fled the labor market and working for some employer. For example, many landless laborers, fed up with low and irregular seasonal wages, have tried to flee the labor market by seizing and occupying land, to obtain independent means of obtaining subsistence. (See, Chapter 4, Section 5.2.2.1 below on efforts to reverse enclosure.) Other waged workers, no longer willing to put up with their conditions of work and wages, have fled both labor market and waged labor in what have often appeared as sudden exoduses, short or long term. Short term flight has included: walking off the job, absenteeism, play, or sabotage. Marx and Engels’ familiarity with such actions began with the Chartists’ short-term strikes and protests, witnessed by Engels in 1842 upon his arrival in England. It continued through their observation of European workers’ long-term flight to the New World, often in the wake of armed uprisings, such as those of 1848. For example, many of the German immigrants who came to Texas after the failure of the Revolution of 1848 proceeded to set up utopian communities intended to be free not only of labor markets but of all capitalist exploitation and alienation.62 By reducing the size of the working labor force, or markedly slowing its growth below capitalist needs, all such actions can cause crises for investors.63 As in 1842, strikes and protests have generally been intended to be short, with workers soon returning to work, win or lose. They cause immediate crises for the struck employers, who can no longer produce, much less invest in expansion.64 The longer such actions last, the greater the disruption to both production and planned investment. 61 62 63 64 Because these disruptive displacements have been recurrent and on a mass scale, not surprisingly, both families and communities have often tried to reconstitute themselves in new lands, whether in cities or countryside. Individuals would move, then bring other family members. In many cases, friends and neighbors would move together trying to hold together remnants of their community of origin. Thus, the establishment by immigrants of a “Little Italy” in New York City, a “Chinatown” in San Francisco, a Greektown in Chicago, a Turkish neighborhood in Berlin or an Algerian banlieue in Paris. As I mentioned in Chapter 2, Marx and his family tended to find lodging in just such communities of exiles and immigrants as they moved or were driven from one country to the next. See, Ernest Fischer, Marxists and Utopias in Texas (Burnet, TX: Eakin Press, 1980). On all kinds of flight, by all kinds of workers, see Marcus Rediker, Titas Chakraborty and Matthias Van Rossum, A Global History of Runaways: Workers, Mobility, and Capitalism, 1600−1850 (Oakland: University of California Press, 2019). On the counter use of scabs, see Chapter 6 below. 154 chapter 4 Flight from one labor market to another is – fleeing workers hope – also temporary and from a greater to a lesser evil. Beyond its universal effort to subordinate life to work, every concrete aspect of work in capitalism varies, from place to place, from employer to employer. Workers know this and frequently look for better paying, safer, less obnoxious jobs, even if it requires moving to obtain them – sometimes not far, sometimes across borders, oceans and continents.65 Flight is particularly appealing to workers who possess special skills or knowledge acquired in one job that they can take to another. However short term for the workers, the flight of a large numbers, or the repeated flight of smaller numbers, can create a longer-term dearth of labor and a serious crisis for multiple employers.66 Exodus from labor markets through flight to distant shores, such as emigration from British and European labor markets to the fabled free lands of the Western Hemisphere can also be short or long-term, depending on whether those fleeing are actually able to obtain land. When successful, their attachment to the land can be as fierce as that of peasants who have resisted enclosure.67 If such immigrants fail to obtain land, however, their flight may be 65 66 67 I first saw this in action in a Paris post office chatting with a North African worker, while waiting in line. I asked him about his job and it turned out he was considering getting a new one. He proceeded to list a whole series of alternatives across Europe, complete with wage scales, benefits, and the degree of unionization. I was impressed! On capitalist responses to such flight see Chapter 6 below. Since the spread of schooling in the twentieth century, such flight undertaken by more educated workers has been labeled a “brain drain” from the countries of origin – an obvious ideological slur on the so-called “uneducated.” Such flight has been portrayed in many films about the American West. Examples: Jan Troell’s The Emigrants (1971) and The New Land (1972) about Swedish immigrants who settle in the forests of Minnesota in the mid-nineteenth century and Ron Howard’s Far and Away (1992) about immigrants fleeing burning crofts in Ireland and seeking free land in Oklahoma during the Land Run of 1893. In both areas “free” land was being taken from Native Americans, in the first case from the Očhéthi Šakówiŋ or Dekota Sioux and in the second from the repeatedly-betrayed Tsalagi or Cherokee (ᏣᎳᎩ), a people already dispossessed in Georgia, Tennessee, Alabama and North Carolina and forced into the 1838 Trail of Tears trek to Oklahoma. Although such flight to land for farming has largely disappeared, along with the dwindling of available land (e.g., the “closure” of the North American frontier), difficulties for small farmers, such as foreclosure and enclosure, have continued and the increasing ­urbanization of society generates ever fewer interested in moving to rural areas. There are still examples of such flight, such as that which has devastated the Amazon cutting down and burning its ecologically complex jungles for conversion to farmland. Unsuited for crop cultivation, most such land has wound up as ecologically impoverished grasslands used for grazing cattle – much of whose meat is exported to wealthy consumers in the The Possibilities of Crisis 155 short-lived as they are forced to re-enter the labor market. Even if they do, eventually, seek new waged jobs, their exodus from old ones remains a problem for the employers in the lands from which they fled. The Europeans who fled to the Americas and moved west to the frontier seeking land included peasants and farmers who had lost their land, those who had worked for wages and those who gained passage across the A ­ tlantic by accepting indenture for several years.68 Eric Williams argues that the­ ease of escape for white workers, whether waged or indentured, was a prime motivation behind the recourse to black slavery by capitalists in North ­America and the Caribbean.69 Those who fled exploitation in cities and towns, pushing the “frontier’ westward – destroying native American communities in the process – included frontiersmen, pioneers, miners and homesteaders in North ­America and similar groups in South America. North American frontiersmen who went west generally hunted for hides or trapped for furs – intruding into the lands previously occupied by Native Americans. (See, Section 3.3.1.) Gauchos went west from the cities on the east coast of South America into the Pampas, the great plains of Argentina, Uruguay and Southern Brazil. Like their counterparts up north, gauchos subordinated their work to their needs. Like many subsistence peasants, they refused to enter the labor market, killed wild cattle for food and hides, which they then sold, but only to obtain what little money they needed to buy what they could not make or trade for.70 As I once argued to historian George Rawick, for the most part such persons escaped working-class status by subordinating their 68 69 70 Global North. Although some countries, such as Canada and Australia continued to offer free land to settlers well into the twentieth century, fewer and fewer have taken advantage of the offer. Today, some small towns offer small plots of free land for house building in the hopes of bolstering their population, but takers are quite different from workers seeking the independence of farmland. Indenture was a legal contract binding a person to work for another for some period of time, during which the person holding the contract tried to extract as much labor as possible. This kind of arrangement has since been banned as a form of slavery. See, Eric Williams, Capitalism and Slavery (Richmond, VA: University of North Carolina Press, 1944). There was a similar problem with Native American slaves who could escape and return to their communities. See, Linford Fisher, “’Why shall wee have peace to bee made slaves’: Indian Surrenderers during and after King Philip’s War” Ethnohistory 64, no. 1 (January 2017): 91−114. See, the classic epic poem El Gaucho Martin Fierro by José Hernández (1872). 156 chapter 4 marginal relations to the market, i.e., C – M and M – C(MS), to their own autonomous ends.71 The frequent comparison of South American gauchos with North American cowboys – because of their independence, equestrian skills and relationship to cattle – rarely differentiates between those successful at avoiding the labor market and those caught up and corralled by settlers, especially ranchers, into hiring out their labor-power.72 Humans, it turns out, were not the only species to flee exploitation. In their own ways, many horses and cattle, imported by the Spanish conquistadors, also fled their enslavers. Almost as soon as horses and cattle reached the mainland in the sixteenth century, they began to escape and multiply, especially in the open grasslands and plains of both North and South America.73 The rapid multiplication of wild horses provided some Europeans the possibility of living free of the exploitation organized by the colonizers. They also provided Native Americans both a physical and a spiritual resource for resistance to European invasion. Both horses and cattle provided meat and hides, while horses also provided mounts. The result was a proliferation of mounted Native Americans and unwaged Europeans roaming free, hunting wild animals, horses and cattle as a way of life. 71 72 73 Like some surplus agricultural products sold by subsistence peasants, the hides gauchos stripped from free cattle and sold did enter an international market for hides, the raw material for the production of shoes, boots, saddlery, and machinery drive belts. Both the agricultural products and hides did embody their labor and as with many farmers, odds have it that they were exploited by unequal trade, but the hunting and stripping was a very minor part of their lives, unlike those whose lives were clearly subordinated to working for capital in either wage labor or production purely for commerce. See, “Some Notes on Argentine Gauchos in the nineteenth century on the Question of ‘Class’” from a letter to George Rawick (1987) in Common Sense 10 (May 1991): 58−61. Besides the gauchos in Argentina and Paraguay, there were vaqueiros and gaúchos in Southern Brazil, llaneros in west-central Venezuela and eastern Colombia, huassos in Chile and vaqueros in Mexico, whether independent or as working as hired hands for ranchers. For analysis of the difficulties for capitalists in turning gauchos into waged workers see, Ricardo Salvatore, “Class Struggle and International Trade: Rio de la Plata’s Commerce and the Atlantic Proletariat, 1790−1850” (PhD Diss., University of Texas at Austin, 1987). For some comparison between cowboys, gauchos and similar “equestrian cultures,” see Richard Slatta, Cowboys of the Americas: The Realities of Life as a Cowboy (London: Lume Books, 2019). Some Native Americans claim that some of these wild horses were indigenous and not descendants of Spanish breeds and have devoted themselves to preserving them and are trying to prove it through genetic testing. The Possibilities of Crisis 157 Hard on the heels of such individual escapees from capitalism came pioneers and settlers, mostly in family units, often by river flatboats or overland by wagon trains, to homestead land. Along with them came artisans to build smithies, saddleries and sawmills – the nuclei of future towns, some of which would become cities. All of this flight from capitalist labor markets, although rarely recognized as such, has been honored and romanticized throughout the Americas. Myriad American pioneer and western novels and films have celebrated both waves – the early loners and the later community builders, while frequently interpreting and instrumentalizing the latter as prototypical would-be entrepreneurs, so central to capitalist ideology. This interpretation confuses all those seeking autonomy from capitalist markets with the very real, self-conscious money-makers who came to build stores, open saloons, hotels and eventually banks – which would play a central role in eventually dispossessing those working the land. And of course, all this accelerated with the coming of the highly subsidized railroads,74 which brought ever more industrial products – means of both production (plows, then machinery) and consumption (cloth, guns, crockery, etc.) – from the East and provided access to distant markets for agricultural products, especially grain, cattle and later sheep, wool, and cotton. Against all this, those who were successful at obtaining land have fiercely resisted its loss.75 The flip side of flight has been the refusal of waged workers to move away from their communities, to labor markets where they are needed by capitalist employers. While some workers move, many others have resisted migrating to jobs. Indeed, whole communities have responded collectively by sending the few willing to go to distant labor markets while everyone else remains behind and the wages of the former help sustain the latter. So, for instance, in Marx’s time male Irish workers went to England for jobs, but their wages – to the extent possible at their low level – would often be used to support their 74 75 Part of the subsidies received by the railroads was land, so much land as to contribute substantially to the enclosure of the frontier. See the maps showing the extent of the grants in the Library of Congress, e.g., that to the Union Pacific Railroad in Nebraska. This continues to be true throughout the capitalist world, in both the Global North and Global South. Despite sporadic enclosure that has depleted the numbers of family farms and peasant holdings, resistance has continued, e.g., in the US, there was the Farmers’ Alliance and the Populist Party of the nineteenth century, which included millions of farmers and more recently the National Farm Family Coalition. In the Global South, Via Campesina, is made up of farmers’ movements around the world. 158 chapter 4 families and communities back in Ireland.76 This pattern has been repeated around the world.77 3.2.2.3 Other Sources of a Shortage of Labor-Power Beyond these refusals on the part of potential workers, other factors with the possibility of disrupting M – LP by reducing the availability of workers and increasing the cost of labor, have included famine, disease and starvation, wartime conscription, and any slow-down in population growth due to women’s struggles.78 The first three possibilities were realized frequently enough in the nineteenth century to seriously reduce the availability of labor. The fourth, although not yet having observable effects on population as a whole, was 76 77 78 Sometimes these have been individual choices, sometimes communal. Examples of the former were discovered by Karen Palazini in a Brazilian favela where she found women who chose to prepare and sell food out of their houses where they could stay in their community and with their children rather than take jobs on the other side of São Paulo, travel to which would cost part of their paycheck and require hours of time. See, “Women’s Work in Lauro de Freitas, Bahia, Brazil: Marginalization or Autonomous Development” (PhD Diss., University of Texas at Austin, 1997). Another example, both within and across borders, was Italy where young, mostly male workers from the South went North to work in factories as capitalists rebuilt after WWII but sent part of their paychecks back down south to support their families and communities. Later, like other North European countries, Italian capitalists welcomed an influx of workers, again mostly male, from North Africa, as their demand for labor-power continued to grow and as women’s struggles reduced the domestic birth rate and slowed the growth of the indigenous labor force. See, Mariarosa Dalla Costa, “Reproduction and Immigration,” originally written and published in A. Serafini, et al., L’Operaio multinazionale in Europa (Milan: Feltrinelli, 1974) 207−242. Translated, in part, for Zerowork 3. A modern example of communal choices – that nevertheless accommodates individual ones – has been documented by Néstor Rodríguez who has identified over fifteen distinct, stable communities of Mexicans in Houston, Texas that are extensions of communities back in Mexico. Those who come north change over time but wages of those who do support both portions of what Rodríguez calls “transnational” communities. See, his “The Battle for the Border: Notes on Autonomous Migration, Transnational Communities, and the State” Social Justice 23, no.3 (Fall 1996): 21−37. This is quite distinct from emigrants sending money home to pay for family members to follow them, as was the case of the Irish in the wake of the great famine, as Marx reports in C ­ apital, Vol. 1, p. 862, or MECW, Vol 35, p. 695. It seems to be a universal trait of many racist xenophobes to believe that every immigrant worker wants to bring all of his or her family and friends to live in (and threaten the cultural integrity of) their superior country. Whether they believe it or not, they wield it to foment anti-immigrant sentiment, which helps keep immigrant workers terrorized and locals less likely to accept them into a common struggle against capitalist bosses. This belief or pretense is belied by the existence of these transnational communities and the frequent permanent return of successful immigrant workers to their points of origin. In microeconomic terms, all these cause a leftward shift in the supply curve of labor. The Possibilities of Crisis 159 understood by capitalists as a very real threat that had to be nipped in the bud before it could cause serious problems. 3.2.2.3.1 Disease and Starvation Besides flight, by far the most obvious dramatic reductions in the labor force, in Marx and Engels’ time, were those caused by famine, disease, and starvation. In the British Isles, the most serious famine of the nineteenth century was undoubtedly the Gorta Mór or Great Irish Famine of 1845 to 1859 that killed a million people.79 In that case, although the root cause of the deaths was a disease that hit potatoes, it resulted in famine because the English colonization of Ireland had forced the conversion of most food cultivation to that of commercial crops, especially flax to pay taxes and feed the British textile industry. As a result of this manner of exploitation, potatoes had become the staple food of peasants in Ireland and when the potato blight hit, the drop in food supplies soon produced malnutrition, disease, and starvation on a massive scale. The deaths, coupled with the flight of over two million emigrants, caused a huge drop in the supply of Irish laborers. This drop and the subsequent series of revolts by Irish workers against their exploitation by the British caused recurring crises for employers. Although on a much smaller scale, the same blight caused crises elsewhere in northern Europe and contributed to the Revolutions of 1848.80 Marx writes of the effects in France: The potato blight and the crop failures of 1845 and 1846 increased the general ferment among the people. The dearth of 1847 called forth bloody conflicts in France as well as on the rest of the continent… the struggles of the people for the prime necessities of life.81 The great famine in Ireland was both preceded and followed by many others, especially in British-colonized South Asia where the yields of most crops depended on adequate but not excessive monsoon rains. In 1837−1838 drought and famine struck Agra in the East India Company-ruled North-Western Provinces and killed roughly 800,000 people. In 1866 drought, famine and then a cholera epidemic killed a third of the population in Orissa (Odisha). The Great 79 80 81 See, David Ross, Ireland: History of a Nation (New Lanark: Geddes & Grosset, 2002). See, the introduction to Eric Vanhaute, Richard Paping and Cormac Ó Gráda, eds., When the potato failed. Causes and effects of the “last” European subsistence crisis, 1845−1850 (Turnhout: Brepols Publishers, 2007) 1−31. K. Marx, “Class Struggles in France” MECW, Vol. 10, p. 52. 160 chapter 4 Famine of 1876−1878 unfolded in south and southwestern India but spread north into the North-Western Provinces and the Punjab. The death toll has been estimated from 5.5 to 10.3 million people. In each such case, the degree of hunger, starvation, disease, and death depended, not only on the weather but also on colonial policies, preceding, during and following the droughts.82 Although each of these events appeared, and was often portrayed as “natural” disasters, the truth was quite different. The colonial replacement of food production for local consumption by the cultivation of commercial crops for export, imposed on Ireland and other colonies, not only makes workers’ health more susceptible to crop failures but has often involved gathering workers into shanty housing, where the presence of disease and sickness spread quickly. Where sick workers are easily replaceable, the cost is relatively low. Where not, money has to be spent on housing and feeding those who, for the time being, can’t work and the costs to employers are higher.83 Because capital organizes workers in an unwaged/wage/salary hierarchy, disease always hits the poorest the hardest. Given their highly contagious nature, some diseases, such as influenza, can spread throughout the income hierarchy. But those with higher incomes are better able to avoid the disease, say by moving away, or to cope with disease, once acquired, by having access to the best available health care.84 Poor workers have no such options. Engels’ 82 83 84 This was true not only in British South Asia but throughout the world of European colonialism. After WWII, as the US and the USSR vied for influence in the ex-colonial Third World, rivalry and self-interest produced a certain amount of “foreign aid” to devastated areas, e.g., the provision of famine relief aid from US food surpluses conditioned on repayment with policy changes beneficial to US corporations. An example was the demand by US diplomats for India to open its fertilizer industry to US corporate investment in exchange for food aid in coping with the drought and famine of 1965−67. See, H. Cleaver, “Food, Famine, and International Crisis,” Zerowork 2 (Fall 1977): 7−69. Such was the lament of United Fruit Company executives about the costs involved in maintaining an adequate labor force to work their banana plantations in Central America. See, the report of United Fruit’s medical director, Edward Salisbury, “Costs and Returns of Industrial Health Services,” in Industry and Tropical Health 1 (1950): 172−173. Victor Heiser, in his An American Doctor’s Odyssey (New York: Norton, 1936) describes many such situations where disease and illness proved costly to US companies abroad. Thomas Mann in his novel Death in Venice (1912), based on extensive research into the history of a cholera epidemic, describes just such flight from the disease-ravaged city by those able to do so, e.g., tourists and locals with enough money. It is the failure of the main character in the novel to join in that flight that results in his death from the disease. This differential continues today. Flight to distant cities, or retreat to country homes are only available to the wealthy. Access to good medical care, especially in countries without universal health care, such as the United States, is also reserved for those able to meet its The Possibilities of Crisis 161 analysis of the Condition of the English Working Class and Marx’s of the reports filed by government inspectors of workplaces and worker housing provide ample evidence of the vulnerability of low-waged workers to disease both on-the-job and off.85 For the most part, the negative impact of disease and starvation is localized. Hurricanes which churn up in the Atlantic and the Gulf of Mexico and cyclones and typhoons in the Pacific and Indian oceans hit low-lying coastal areas hardest. Flooding occurs mostly on coasts and in river valleys and deltas. Fires rage mainly in drought-struck brush and forested areas or among poorly constructed houses in working-class neighborhoods. When the winds die down, the flood waters recede and the fires burn out, the locals left most devastated are usually workers and their families – those living in shanty towns or poor neighborhoods – because they don’t have the resources to escape, cope or rebuild.86 Their suffering costs money to those who employ them, either in caring for them or replacing them. The obvious exceptions to such localization have been pandemics in which disease has spread across much of the world, carried from country to country by some vector. In the case of the Black Death (bubonic plague) of the fourteenth century, the vectors were rats and rat fleas, carried from Asia to Europe on ships engaged in international trade and imperialism. In the case 85 86 high cost. The rich can also afford guardians for children kept home from school during epidemics; poorly paid workers cannot. We have seen this play out amidst the Covid-19 epidemic. In the wake of Covid-19, an analysis of cellphone data showed that 40 percent of the people in the richest neighborhoods in New York City fled the city! See, Kevin Quealy, “The Richest Neighborhoods Emptied Out Most as Coronavirus Hit New York City,” New York Times, May 15, 2020, “Hundreds of thousands of New York City residents, in particular those from the city’s wealthiest neighborhoods, left . . .” See, Marx’s analysis in Capital, Vol. 1, Chapter 25, Section 5, Subsections (b) and (c), and Engels’ analysis in his later essay “The Housing Question,” MECW, Vol. 23, pp. 317−391. In recent times, such differential impacts have been experienced from the slums of cyclone-battered Philippines or Bangladesh to the 9th Ward in New Orleans, devastated by the Hurricane Katrina (2005). Despite the promises of President George W. Bush, most working-class housing there has never been rebuilt. The same pattern was repeated with Hurricane Maria (2017) that wrecked Puerto Rico. President Donald Trump infamously tossed paper towels to the victims but denied the extent of death attributable to the hurricane and refused to provide adequate aid to rebuild. While urban fires may be more likely to destroy city slums, forest fires in California and grass fires in Hawaii have demonstrated how this is not always the case. Workers’ homes built far from city centers and ever deeper into surrounding woodlands have been burned in California. So have homes in Maui in 2018 and the entire town of Lahaina in the summer of 2023 as wildfires swept through the dry grass and abandoned sugar cane of now closed plantations. See, Cost of Government Commission, Report on Wildfire Prevention and Cost of Recovery on Maui, July 2021. 162 chapter 4 of smallpox, cholera and every influenza pandemic, the vectors have been humans, traveling from place to place, from the Spanish invaders of the Western Hemisphere in the sixteenth century to merchants, armies and tourists in the nineteenth. In the cholera epidemics of 1817−1823 and 1826−37, the disease spread from India to other parts of Asia, the Middle East, East Africa, the coasts of the Mediterranean Sea, Northern Europe and eventually to North America and south into Mexico and the Caribbean.87 All of these waves of disease have revealed the vulnerability of working-class populations and the continuing possibilities of crisis in labor supply. The differential results typical of local epidemics, i.e., hitting lowest-paid workers and their families hardest, have been largely the same with pandemics.88 In all historical cases, millions of ­workers 87 88 Unfortunately, despite the discovery by modern medicine of the nature of these diseases and of effective methods of treatment, new or mutated bacteria and viruses, often spread by thoughtless capitalist practices, have caused repeated pandemics, each requiring new research and new discoveries in order to cope with each outbreak. The cholera pandemic in Latin America (1991−1995) is thought to have begun with a ship from Asia dumping its human wastes or ballast water in the harbor of Lima, Peru. It reached Chiapas, Mexico in 1995 in the midst of the Zapatista struggle for indigenous rights and democracy. At that time, I posted a series of interventions on one solidarity listserv about cholera and the political history of disease. More recent pandemics have included those of cholera (a whole series, including 1961−75) spread by water contaminated by human feces, of HIV/AIDS that started in the 1980s, spread by humans, and of a whole series of influenza pandemics, e.g., the Spanish Flu (1918−1919), spread by humans, Swine Flu (2009), spread by animals and humans, SARS and MERS, and today, Covid-19. For an overview of the history see the Wikipedia entries for pandemics in general and for particular cases. We are currently seeing this differential impact play out as Covid-19 sweeps across the globe. As schools, businesses, sports arenas and other meeting places have been emptied and people ordered to stay home, “social distancing” and “self-quarantining” to slow the spread of the virus. Clearly those who can best afford to do these things are those higher up the income hierarchy and those least able to do so are those lower down. Those with savings can draw on them; for those dependent on current wages for food, rent or mortgage payments, the loss of a job immediately undermines their ability to pay bills and buy necessities. When schools are closed, children from low-waged households dependent on school breakfasts and lunches can be in serious trouble. When their only access to classes is via computer and they have none, they are left out of school-from-home. All of this played out before our eyes in 2020−21 during the Covid-18 pandemic. See, Lizzie Wade, “An Unequal Blow: In past pandemics people on the margins suffered the most,” Science 368, no. 6492 (May 15, 2020): 700−703, and Liliana Dávalos, et. al., “Pandemics’ historical role in creating inequality,” Science 368, no. 6497 (June 19, 2020): 1322−3. Another exception to localization, only recently recognized, has been human-­ accelerated global warming with its ever increasing effects on a wide variety of disasters, including flooding, fires and species extinction. (More on this in Chapter 5 on predispositions). The Possibilities of Crisis 163 have suffered and been unable to work, through sickness and often death, dramatically reducing the availability of labor-power in both labor markets and production. As capitalist circuits have become ever more entwined on a global scale, creating far-flung networks of production and sales, local disruptions can quickly circulate to cripple reproduction. Where the production in one place provides inputs into production in another place, the reduction in production due to disease ripples along the supply chain. Where disease disrupts the transportation of commodities, shutting down ports or dramatically raising the costs of transport, costs rise and profits fall.89 (More on this in Chapter 5, Section 4.) The connections between class struggle and these pandemics that disrupt capitalist reproduction deserve far more attention than they have received. While the differential negative impact on workers has derived from exploitation and workers’ failure to successfully win higher wages, better housing and access to medical care, their reaction has sometimes been outrage and uprising against the neglect of measures to protect them – actions which can further disrupt production.90 3.2.2.3.2 Military Poaching of Workers Even without the contribution of imperialist armies to the spread of disease and its negative effect on the supply of labor, the simple drain of workers from the labor force into the military reduces labor supply at home and can cause 89 90 The global character of the current Covid-19 pandemic has caused such widespread ruptures in supply chains that the business press regularly reports on such ruptures, providing estimates of their severity, their consequences and expected duration. See, the daily email bulletins of the Bloomberg group. For example, “The cost of shipping a 40-foot container from Shanghai to L.A. reached $11,569 in the past week, almost eight times higher than pre-pandemic levels, according to the Drewry World Container Index. One illustration of the strained system is the queue of ships outside the twin ports of L.A. and Long Beach, which jumped to a record 49 vessels as of late yesterday.” (9/10/2021) An obvious example was how government neglect and capitalist discrimination against victims during the HIV/AIDS pandemic led to massive and ultimately successful mobilization demanding resources for both research and treatment for victims. Our most recent experience of such outrage and uprising exploded in June 2020 in the US. Although triggered by videos of police murdering an unarmed black man, the event came amidst the Covid-19 pandemic in which growing numbers of reports pointed to the differential effect of the disease on those minorities continuing to work in “essential jobs” or suffering from being laid off with inadequate unemployment compensation and having the least health insurance to help cope with the disease. Sadly, efforts by right-wing politicians to utilize the pandemic for their own political ends, has also resulted in the confounding phenomenon of conservatives raging against masks, vaccines, and social distancing – measures designed to protect them! 164 chapter 4 a crisis for employers. The “military revolution” that accompanied the rise of capitalism and its nation states involved a vast expansion in the size of armies and a resulting shift from the use of mercenaries and volunteers to large scale conscription. The most notable exemplar of this expansion occurred with Napoleon Bonaparte’s conscription of a gigantic army to conquer much of continental Europe.91 Other countries followed suit. For example, Marx mentions how reductions in the numbers of agricultural workers during the Crimean War of 1853 to 1856 contributed to such an increase in wages as to cause employing farmers to protest and introduce machinery.92 Military forces were recruited among both waged and unwaged workers. Among the waged workers impressed into military service were sailors from commercial vessels, either in port or at sea. This immediately reduced the number of workers available to those merchant capitalist ships, and their captains had to find replacements on their own. Among the unwaged taken into the military were conscripts from peasant villages, which immediately reduced the size of the agricultural labor force. Others were taken from taverns or prisons reducing the size of the latent reserve army of labor and its availability to employers, either as a threat to the currently employed or as replacements.93 Both at home and abroad Black slaves and indentured “coolie” laborers from India and China were diverted from more productive labor to the work of building fortifications, etc.94 Although local recruiting of the colonized, e.g., Sepoys in India, helped limit the drain at home, it reproduced it in the colonies. Whatever the source, the scale of extraction of workers from the labor force available to capitalists is determined by the scale of military mobilizations and by the degree of resistance to recruitment and conscription. Conscription, after all, involves forced participation in the military and that in turn produces widespread avoidance and desertion from the ranks. The drain and associated conflict swelled in periods of war, either of conquest or between imperialist powers. The greater the resistance to colonialization or the bigger the war, the more workers are conscripted and the greater the problem for capitalists trying 91 92 93 94 See, Isser Woloch, “Napoleonic Conscription: State Power and Civil Society” Past & Present 111 (May 1986): 101−129 and Louis Rouanet and Ennio Piano, “Drafting the Great Army: The Political Economy of Conscription in Napoleonic France,” The Journal of Economic History 83, no. 4 (December 2023): 1057-1100. Capital, Vol. 1, p. 791, or MECW, Vol. 35, p. 632. In modern times, where youths have been subjected to conscription, the unwaged have also been plucked from schools. On the use of “coolie” laborers as late as WWI, see, Guoqi Xu, Strangers on the Western Front: Chinese Workers in the Great War (Cambridge, MA: Harvard University Press, 2011). The Possibilities of Crisis 165 to maintain or recruit workers.95 It’s worth noting that the degree to which draft dodging resistance reduced this drain on the labor force has depended on the strategies of the dodgers. Some sought waged employment elsewhere and remained available to capitalist employers. But others disappeared from the labor force entirely by becoming bandits or by escaping to settle in remote areas.96 3.2.2.3.3 Reductions in Family Size Here, I feel obliged to point to an important phenomenon that Marx and Engels should have taken into account in their analysis of crisis but did not – as far as I have been able to find. When they analyzed internal family dynamics, they focused on power relationships, but failed to study how those relationships affected birth rates, population growth and the availability of workers for hiring. I find this surprising considering their familiarity with what the English political economist Thomas Malthus had to say on the subject in his book An Essay on the Principle of Population (1793) – a man whom Marx and Engels ­criticized again and again on other topics related to crisis. Malthus argued theoretically that population, and hence the supply of labor, tends to grow exponentially because workers tend to breed like rabbits, unlike the bourgeois who sometimes exercise “moral restraint” and limit the size of their families. At the same time, he saw agriculture and the supply of food tending to expand more slowly than population. As a result, population growth and the supply of labor, he argued, is mostly only checked by external factors, such as famine or war. Among the lessons he drew from this analysis were that 1) the poor had only themselves to blame for their situation and 2) feeding the poor, i.e., those with no wages, should be abandoned because with more food they would just breed faster and create more poverty. This argument appealed to capitalists and was wielded by them against the Poor Laws or any other form of relief. Eventually, in the second edition of his book (1803), after studying actual population dynamics in Europe, he admitted workers did appear to be able to 95 96 This problem of labor shortages caused by wars that draw off men became familiar during World Wars I and then II as it became difficult to “man” factories and even farms for plantings and harvest. Special efforts had to be made by capitalists and governments to replace absent male workers – sometimes with prisoners or immigrants, but often with local women. The problem persisted after WWI, and to a lesser degree after WWII, especially in Europe, because of the high death rate in the war. Governments also formulated pro-natalist policies to encourage women to have more children to replace those who had been killed. For a wide-ranging survey of worker flight from work, which includes multiple examples of workers absconding from armies and navies, see A Global History of Runaways, op. cit. 166 chapter 4 exercise restraint and choose to have fewer children. But this admission had no effect upon the embrace of his theoretical argument by those opposed to any help for the poor.97 Instead of addressing these issues, Marx and Engels’ emphasis on the ­internal power structures within the family focuses on the inequities of men dominating both women and children. As early as the Manuscripts of 1844, the German Ideology (1846), and the Communist Manifesto (1848), they argue that property relationships shape family relationships.98 They juxtapose the bourgeois family, in which, they argue, the possession of property results in relationships being reduced “to a mere money relation”, to the proletarian family, which lacks property and therefore the relation of husband “to his wife and children has no longer anything in common with bourgeois family relations.”99 They condemn the former, “the bourgeois sees in his wife a mere instrument of production [of progeny]” to maintain the continuity of family property, and mock the bourgeois pretense of a “hallowed c0-relation of parent and child.”100 They call, therefore, for the liberation of women from the servitude of the bourgeois family and stopping “the exploitation of children by their parents.”101 Yet, by the time Marx writes Capital, he also recognizes how – under the pressure of poverty – desperate proletarians are willing to allow their children to be exploited by capitalists. We find in the most recent years of the Children’s Employment Commission [1850s-60s] that in relation to this traffic in children, working-class parents have assumed characteristics that are truly revolting and thoroughly like slave-dealing.102 Decades later, Marx and Engels’ discovery of the writings of the anthropologist Lewis Morgan (1818−1881) spurred both to new thinking about the origin, nature and destiny of families. Although Marx died before he could do more 97 98 99 100 101 102 True then, true ever since. This kind of Malthusian argument has been reformulated and trotted out again and again in opposition to all forms of “social safety net” expenditures, right up to recent opposition to those designed to offset the effects of the Covid pandemic. Marx, “Economic and Philosophic Manuscripts of 1844”, MECW, Vol. 3, pp. 294−296, Marx and Engels, “The German Ideology,” MECW, Vol. 5, p. 44, 180−181. Marx and Engels, “Manifesto of the Communist Party”, MECW, Vol. 6, p. 494. Ibid., p. 502. Ibid., pp. 501−502. Capital, Vol. 1, p. 519, fn 40, or MECW, Vol. 35, p. 399. The Possibilities of Crisis 167 than take notes on Morgan, Engels picked up where he left off, writing and publishing The Origin of the Family, Private Property and the State in 1884.103 In that essay, he sketches the historical evolution of the family from pre-­ historic times to contemporary capitalism. In doing so, he elaborates their previous assertion about the dominance of men over women in the bourgeois family. While anchoring the rise of the patriarchal family and “the subjugation of one sex by another” in pre-capitalist times, his main concern is the “final outcome of three thousand years of monogamy”104: The modern individual family is based on the overt or covert domestic slavery of the woman … the man has to be the earner, the bread-winner of the family, at least among the propertied classes, and this gives him a dominating position … In the family, he is the bourgeois; the wife represents the proletarian.105 And, as in the case of those two classes, there is a struggle in which the wife/ proletarian often rebels against her servitude. As in the Manifesto, Engels juxtaposes this situation to that of working-class families where, because industrialization “has moved the woman from the house to the labor market and the factory, and made her often enough the bread-winner of the family, the last remnants of male domination … have lost all foundation … the woman has regained, in fact, the right of dissolution of marriage …”106 So, if wives’ traditional servitude to their husbands includes their role as brood-mares, one might expect women to use the power conveyed by the wage, in ways that would result in a decrease in birth rates. Yet, Engels says nothing about this. His only solution to women’s struggles is their complete integration into the waged labor force. “… the first precondition for the emancipation of women is the reintroduction of the entire female sex into public industry.”107 In short, neither Marx nor Engels provide any analysis of intra-family struggles around procreation and child rearing that could provide an alternative to Malthus’ simple-minded vision of working-class homes as “bunny hutches” where only the food supply determines birth rates. Despite recognizing that 103 104 105 106 107 Friedrich Engels, “The Origin of the Family, Private Property and the State” (1884), MECW, Vol. 26, pp. 129−276. Ibid., p. 175. Ibid., p. 181. Ibid., p. 179. Ibid., p. 182. 168 chapter 4 women’s work in the home produces labor-power, they never bring to bear on that work the kind of detailed analysis they elaborate with regard to the production of all other commodities.108 For this to happen, several generations of Marxist feminists have had to do what those two men did not, and in so doing help us understand the sharp declines in birth rates which would eventually create crises for capitalists’ ability to meet their needs for labor-power.109 This absence is all the more striking because not long after Marx and Engels passed from the scene demographers came to recognize how rising income produces a “demographic transition”, with eventual falling birth rates and slower population growth.110 Rising incomes free parents from the need to peddle their children to capitalists for a wage that supplements their own. ­Rising income also reduces the need for children’s labor at home, e.g., on farms. Moreover, for both waged and unwaged families, it reduces the need for children as ultimate care providers for their parents – for many the only form of social security for old age. All these factors help explain fewer births and slower growth of the labor force. Finally, we also now know that the speed of this demographic transition has been determined by that to which Marx and Engels paid little attention: the degree to which women’s struggles have given them control over their bodies, including their ability to control the number of their children. Everywhere women have gained more control, birth rates have fallen, often dramatically, causing a reduction in the growth of the population and hence of the labor force – sometimes reducing it well below the needs of capital and therefore causing a crisis in M – LP.111 3.2.3 Overzealous Investment The most obvious possible problem on the demand side of the labor market I have already discussed in the first section of this chapter, i.e., possible problems in raising sufficient money to hire enough workers for planned investment. All the possible impediments discussed there could be repeated here, including: (1) workers past struggles causing a shortage of retained earnings and (2) problems in access to credit due to perceived risks, or to central bank 108 109 110 111 Capital, Vol. I., pp. 519−520 fn. 40, or MECW, Vol. 35, p. 399, fn. 2). See, Silvia Federici, Patriarchy of the Wage: Notes on Marx, Gender, and Feminism (­Oakland: PM Press, 2021) Chapter Three: Gender and Reproduction in Marx’s Capital, pp. 32−50. Mikko Myrskyla, et. al., “Advances in development reverse fertility declines,” Nature 460, no. 7256 (August 2009): 741−743. Although this source is modern, rising income was decreasing fertility long before. In the post-WWII decades, women’s gains and the slower growth of the labor force contributed to rising wages, forcing capitalists to have recourse to immigrant labor. See, Dalla Costa’s “Reproduction and Immigration”, op. cit. The Possibilities of Crisis 169 policies, both of which can raise interest rates, undercutting expected profits. Even in the absence of such problems, however, there is another all-tooc­ommon possible source of crisis. That source, to which both Marx and Engels return repeatedly, is how the demand for labor often outstrips supply. This commonly occurs in boom periods when capitalists are zealously investing, as quickly as money and available MP allow, to expand production to take advantage of apparently expanding markets and record profits. In such periods, real investment in expanding production capacity is often taking place in an atmosphere of rabid speculation, hardly an environment for careful calculations of risk. Enthusiastic investment can cause soaring demands for labor that can outstrip a depleted, stagnant, or more slowly growing supply. This increases workers’ bargaining power and their ability to win increases in wages and other benefits (including less work) large enough to undercut profits. Any serious reduction in profits, or the rate of profit, constitutes a crisis for capitalists. Substantial reductions in investment can bring the boom to an end and contribute to a downturn, not only in individual industries but in economic activity as a whole. Marx writes: If the quantity of unpaid labour supplied by the working class and accumulated by the capitalist class increases so rapidly that its transformation into capital requires an extraordinary addition of paid labour, then wages rise and, all other circumstances remaining equal, the unpaid labour diminishes in proportion. But as soon as this diminution touches the point at which the surplus labour that nourishes capital is no longer supplied in the normal quantity, a reaction sets in: a smaller part of revenue is capitalized, accumulation slows down … 112 Against Malthus’ reasoning that fluctuations in wages are caused by fluctuations in labor supply, Marx argued the contrary, that fluctuations in capitalists’ demand for labor – over the course of booms and busts – was the primary explanation for increases or decreases in wages and the effects on profits, the willingness to invest and to hire. How capitalist reductions in investment during downturns can help overcome the power of workers to raise wages, I take up in Chapter 7. Also, on the “demand side,” it is worth noting how more often than not when capitalists hire workers it has been common to put them to work and then pay them – a situation in which it is the workers who are effectively extending 112 Capital, Vol. 1, Section 1, p. 771, or MECW, Vol. 35, p. 616. 170 chapter 4 credit to the capitalists. It is an organization of M – LP in which workers effectively work for free for some period until capitalists have money on hand to pay them. Marx writes, the “money of the buyer in this exchange mostly functions as means of payment … it can be said that everywhere the worker gives credit to the capitalist.”113 Given the low level of wages and narrow limits of workers’ savings, such credit must be short lived – a day or a week at most in Marx’s time – albeit repeated regularly. Because of this, it is often the case that “In times of crisis, and even with isolated bankruptcies, it is then revealed that this credit given by the workers is no mere phrase since they do not get paid.”114 In such circumstances, failure to pay must very quickly lead to worker protests, slowdowns in labor or even work stoppages and strikes. In the nineteenth century such sequences often played out when capitalists, short of funds and unable to borrow as credit became too expensive, reduced or shut down production, laying off workers and not paying them. 3.3 Possible Crises for Buyers of the Means of Production, M – MP This section deals with crises faced by capitalists who need to buy means of production. The flip side: crises facing capitalists selling means of production are dealt with in Section 5.2.2. Because capitalist purchases of MP are acts of investment, willingness to buy depends upon everything I discussed in Chapter 3 above, including both investor estimations of the potential profitability of the investment, and their ability to mobilize the resources necessary, not only to purchase MP but also to hire LP. That ability depends on their accumulated surplus value and, if necessary, their access to loanable funds, i.e., their ability to borrow from the monetary commons pooled and managed by various financial intermediaries. Given these conditions, the most obvious source of crisis 113 114 Marx points this out in the “Manuscript of 1861−63,” MECW, Vol. 30, pp. 52−53 and in Capital, Vol. 1, pp. 278 and 1066, or MECW, Vol. 35, pp. 184−5. This situation still obtains, even with salaried workers, who are usually paid at the end of a month’s labor. In isolated mining or mill towns, it has also often been the case that the local company extends consumer credit to the workers in the period running up to the day they are paid – at which point they pay back the company with their just received wages. There’s a revealing scene in the film Coal Miner’s Daughter (1980) where Loretta Lynn, still a little girl, is with her father who comes out of the company office with his pay and says “Let’s go give the company its money back” as they head for the company store where they had been buying on credit. Besides low pay and high interest on “store credit,” Marx also writes of a third opportunity for exploitation used by such companies with isolated and dependent labor forces: rent on ill-built and unhealthy housing. See, Capital, Vol. 1, pp. 585−6, 820−2, 837−842, MECW, Vol. 35, pp. 460, 659−660, 673−677. Some years later, in 1872−4, Engels wrote a series of articles addressing such housing issues. See, MECW, Vol. 23, pp. 317−391. MECW, Vol. 30, pp. 52−53. The Possibilities of Crisis 171 for buyers of the means of production are unexpected increases in their price, which would increase their costs of production and thus reduce expected profits. If the reduction is large enough, planned investment may be abandoned. The most likely sources of such unexpected increases in prices are problems in the production, transportation, or markets for needed MP. In his theory, because it is a theory of a fully developed capitalism, Marx generally assumes capitalists buy MP from other capitalists with money. However, as his analysis of primitive accumulation, colonialism and the gradual transition from traditional agriculture and artisanal handicraft to capitalist industry shows, he was fully aware that capitalism first emerged and developed within a non-capitalist world. As capitalists have expanded their operations across the face of the earth, they have repeatedly faced peoples who have not yet had any use for money but have had things to trade usable as means of production for various industries. In such situations, capitalists have often resorted to one of the oldest methods of merchants: barter. 3.3.1 Barter and Crisis As an early example of the acquisition of MP via barter was the fur trade with Native Americans, beginning in the 1600s. This barter was soon undercut by the acquisition of furs from European trappers, who would sometimes barter furs for things they needed but often wanted to be paid in cash. Both the barter trade in furs and that for cash were integral to the rise of capitalism, both local and international. European merchants were bent on acquiring furs to resell and created elaborate networks to cultivate fur trapping and trade with both Native American and European trappers. Industrial capitalists sought furs, instead, as means of production. These Europeans learned that they could trade use-values for furs. In so doing, they were both acquiring what they wanted and, effectively, annexing and exploiting the labor and skills of trappers for their own purposes.115 115 Given the refusal of most Native Americans to submit to the labor market, trade was one of the few ways their labor could be annexed. Another, notoriously practiced by early European invaders, was slavery. See, the entire issue of Ethnohistory 64, no. 1 (January 2017) on “New Directions in the History of Native American Slavery Studies.” Assuming far more labor was involved in trapping and preparing pelts for sale than in manufacturing the items for which they were traded, Native Americans and trappers were being exploited through unequal exchange. This form of annexation of labor-power was akin to that employed by merchants in the “putting-out system” wherein capitalists bought raw materials such as flax, wool or cotton from both capitalist and non-capitalist peasants, then “put the materials out” to spinning and weaving artisans, and then bought the resulting thread, yarn, and cloth from 172 chapter 4 On the East Coast of North America European settlers learned early on they could trade wampum or beads made from shells for furs from Native Americans. Originally, the invading colonists wanted furs for immediate consumption, for the same immediate use-values as the indigenous, e.g., warm coats. Oblivious to the myriad use-values of wampum to native Americans, the Europeans looked at wampum as a kind of primitive money and set about producing the beads themselves, purely for barter trade. This pattern of trading industrial goods for Native American use-values was repeated as the European invasion moved West, with what they offered in trade varying according to the practices of the people encountered. More notorious than the trading of industrially produced use-values such as wampum, steel knives or cloth was the trading of alcohol or guns in exchange for whatever the merchants or capitalists sought to obtain. Although an anomaly in capitalism, barter trade, like trade using money, was also susceptible to crises. The sources of such crises could be found both in the supply of use-values and in the demand for them. Supply was subject to short-run disruptions among trappers due to conflicts over who could trap what and where. Conflicts raged not only between European and Native American trappers but also between tribes of Native ­Americans. Such conflicts were aggravated by those among competing ­European colonialists, e.g., the French-Indian War (1754−1763), in which both the French and the British allied with different tribes and pitted them against each other for their own competing imperialist interests. As the variety of manufactured trade goods and Native American desires for them grew, so did conflicts among suppliers, both Native American and European. Supply was also subject to the long-run problem of the depletion of animal populations being trapped or hunted. As trade expanded, the earlier limited indigenous trapping for furs or hides, which involved a sustainable relationship between people and their environment, fell victim to their subordination to the much greater demand driven by the capitalists selling to European producer and consumer markets. With activities such as fur-trapping and trade the only way for indigenous peoples to obtain the goods churned out by capitalist industry, trapping for trade eventually depleted the trapped populations, them as MP. Both cases deserve Marx’s characterization of such annexation of labor as a purely formal one in the sense that capitalists had not yet enclosed and taken over either the fur industry or textile manufacturing. When takeovers involved a reshaping of the production process, he called the process a real subordination of people’s labor. The same kind of transition took place in C′ – M′ but I deal with that in my analysis of the third stage of the circuit. The Possibilities of Crisis 173 upset local ecological balances, and caused a drop/crisis in the supply of furs and thus a rise in price and fall in profits. Similar dynamics obtained everywhere in the world as capitalists penetrated new areas populated by peoples without money. The demand for indigenous use-values as MP, was, in turn, dependent on the demand for the goods being manufactured with them. In the North A ­ merican fur trade, the demand for furs was dependent on the demand for various kinds of clothing made from furs, e.g., fur coats, or hats made from the felt extracted from beaver hides. So, when such hats fell out of fashion, or felt was made from cheaper rabbit fur, the result was a crisis in the trade for beaver hides.116 Although important in processes of primitive accumulation, as capitalist trade expanded in the nineteenth century, barter tended to be progressively replaced by the trading of goods and services for money (or the precious metals from which many monies were made).117 On the basis of their usual assumptions of both monetary exchange and the availability of sufficient money to purchase required MP, Marx and Engels pointed to a number of possible sources of crisis in M – MP, including those resulting from the struggles of workers, time lags, natural disturbances and political blockades of trade. 3.3.2 Possible Crises for Buyers Caused by Workers’ Struggles When capitalists purchase MP from other capitalists, the relationship M – MP falls within the sphere of exchange and circulation and unlike M – LP involves no direct relationship with workers. However, the quality, supply and price of MP does depend on the relationships between capitalists and workers within the industry producing MP – be it in fields, mines, factories or offices – and in their transportation to wherever the capitalists buying them intend to put them to use in production.118 In criticizing Ricardo on crisis, Marx writes, 116 117 118 The market for beaver fur eventually rebounded with the demand for new kinds of hats, e.g., cowboy hats, providing some income for remaining trappers. More recently, long after capitalist industrialization came to dominate hide and fur production, strong animal rights campaigns against the use of animal hides and fur and for the substitution of synthetics have begun to reduce the demand for such products in some markets, by both fashion houses and final consumers. That said, barter, as one form of “countertrade”, has never disappeared from capitalism. In the post-WWII period, the destruction in those parts of Eastern Europe taken over by the USSR resulted in most trade between Soviet state-capitalism and its clients taking the form of barter. Even today dozens of countries and businesses organize their exchanges through barter. See the Wikipedia entries on barter and countertrade. As previously indicated transportation of MP is also a process of production – a spatial displacement – but because it involves different workers, often managed by different 174 chapter 4 The same hold up [in investment] could occur for the opposite reasons, if the real prerequisites of reproduction were missing (for instance, if grain became more expensive or because not enough constant capital had been accumulated in kind). There occurs a stoppage in reproduction and thus in the flow of circulation.119 Violent fluctuations in price [of raw materials] thus lead to interruptions, major upsets and even catastrophes in the reproduction process.120 Clearly, grain (and other MP) can “become more expensive” due to workers’ struggles in their production and transportation (more in Section 4.2 on crises in …P…) that reduce quality and cause shortages. When workers go on strike and shut down production, crops rot in the fields, nothing is added to inventory, ships are neither loaded nor unloaded and undelivered C(MP)’ deteriorates. With their production shut down, enough raw materials, intermediary goods, tools, or machinery might not be accumulated. The more complex the “supply chains” of production and exchange, the more points of class struggle and the more numerous the possibilities of breakdown in both the production and shipping of MP. Similarly, even in the absence of shortages, when such actions by workers producing MP are successful in raising wages and the increased cost of production is passed on through higher prices of C(MP)’, this increases costs, c, for buyers of MP and reduces the rate of profit, s/(c + v) undermining investment and planned expanded reproduction.121 3.3.3 Crises for Buyers Caused by the Appropriation of MP Another source of problems in the availability of MP, has been their direct appropriation by workers or their theft by other capitalists. In this essay, and more generally, I differentiate between “direct appropriation”, i.e., the taking of either MS or MP by workers and “theft”, i.e., the theft of MP by capitalists. The former term amounts to a refusal of the legitimacy of laws, generally written by 119 120 121 c­ apitalists, it constitutes a different sphere of production. Sometimes the sale of MP takes place before their transportation, sometimes after. MECW, Vol. 32, p. 125−126. Manuscript of 1864−65, p. 226, Capital, Vol. 3, p. 213. MECW, Vol. 37, p. 119. Marx almost always assumes that the minimum acceptable level of profits is the “average,” but clearly this is not always so. Capitalists attempting to penetrate new markets and carve out a share for themselves have often accepted below average profits in the short term. So-called “loss leaders” are commodities sold at below profit prices in order to draw customers into buying other items being sold at profitable prices. The Possibilities of Crisis 175 capitalists or their apologists, whose definition of “theft” ignores the difference between the taking of personal private property and that of capitalist-owned means of production.122 Wherever they occur, all such acts reduce the supply of either MS or MP, cause shortages and increase prices, reducing the real wages of buyers of MS and profits for buyers of MP. Let’s examine the behavior of these two very different sorts of actors in turn. 3.3.3.1 Direct Appropriation of MP by Workers Just as workers have tended to directly appropriate MS for their own consumption or for resale to augment their income, discussed in Section 5.2.2.2 below, so too have they appropriated some means of production, e.g., food, raw materials, fuel, or tools, for the same purposes. The peasant direct appropriation of wood in forests, which caught Marx’s attention in the 1840s, was an appropriation of means of production only to the degree they cut trees that were to be harvested as lumber; fallen wood was of use only to their personal ­consumption, e.g., firewood for heating or cooking. An example from the eighteenth century, analyzed in fascinating detail by Peter Linebaugh in The London Hanged, was the repeated appropriation of tobacco throughout its transportation from drying barns in America to British wharfs, warehouses and retail outlets by slaves, waggoneers, lightermen and porters, sailors on ships, warehouse carters and even government inspectors.123 Although some of the tobacco was clearly a consumption good, some was raw material destined to be transformed into cigars, snuff, etc. Obviously, the more tobacco that disappeared into worker pockets along the way, the less was available as MP and the higher the price for industrial buyers. The London Hanged also details such appropriation by shipyard, silk and leather workers, who would take “scraps” from their workplaces for their own use, or to work up and sell.124 Their appropriation increased the cost of MP by forcing their employers to spend more on raw materials. In agricultural zones, where foodstuffs are grown commercially as C(MP), workers, both small holding peasants and landless laborers, sometimes directly appropriate food from the fields of agrarian capitalists, effectively converting MP into MS and increasing their income.125 This is especially common 122 123 124 125 The same distinction holds between the capitalist “theft” of workers’ time and energy by imposing work, and their “direct (re)appropriation” of their time. Capitalists, of course, call the former legitimate work time and the latter “time theft.” See, Chapter Five: Socking, the Hogshead and Excise, pp. 153−183. Ibid., Chapters Eight and Eleven. When working as a landless laborer on a fruit farm in France, I observed and took part in such direct appropriation during harvests. In the case of cherries, “Une pour le boss, une pour la bouche” was an unspoken but common mantra among workers harvesting fruits 176 chapter 4 in periods of food shortages and famine but can take place at any time.126 The appropriation reduces production, revenues and profits of those owning the fields from which foodstuffs have been appropriated. If widespread, it reduces supplies to the market, increases the cost of MP, lowering the profits of the relevant food processing industry. And to the degree that these increased costs are passed along to workers through increased food prices, they lower the real wage of consumers, reducing consumer demand. Because many raw materials – tobacco, cotton and other fibers, ores – were produced in colonies far from the handicraft and factory workers who processed them, their transportation to distant factories was subject to all kinds of disruption by all the workers involved, on both land and sea, including mutiny and piracy.127 In the case of mutineers turned pirates, of course, not only the cargo being carried was appropriated but often the ship itself – the most important means of production in the long-distance transportation of both MS and MP.128 3.3.3.2 Theft of MP by Capitalists In the case of capitalists stealing from other capitalists, when the means of production, MP, are stolen merely to resell them, via hijacking or piracy, the thieves are effectively acting as agents of rogue merchant capitalists engaged in illegal activity. When the MP are stolen to be covertly integrated into another 126 127 128 that could be easily consumed. For other fruits, e.g., peaches, such appropriation for consumption was virtually impossible to conceal and therefore not practiced. Peasants in Bihar Sharif, Bihar, India, described to me in 1976 at length how, after their legal public protests were violently repressed by the Indira Gandhi regime, in the middle of the night during harvest season they directly appropriated crops from the better irrigated and more heavily fertilized land of the local rich landlord – despite the threat of his armed goondas. Piracy of MP has by no means disappeared in the twenty-first century, e.g., Somali pirates taking oil tankers in the Gulf of Aiden and holding them for ransom. Both the ransom and increases in insurance raise the price of this energy MP, c, lowering profits s/(c + v). As in earlier periods, their actions provoked both the arming of crew and support from military forces deployed to protect such commercial shipping. The films The Highjacking (2012), by Tobias Lindholm, Stolen Seas (2012), by Thymaya Payne, and Captain Philips (2013), by Paul Greengrass, all portray the conflicts between pirates and commercial capitalists. Two other films show the situation of the poor Somali fisherfolk whose circumstances led to their turn to piracy: The Pirates of Somalia: The Untold Story (2011), by Neil Bell, and Fishing without Nets (2014), by Cutter Hodierne. See, Marcus Rediker, Villains of All Nations: Atlantic Pirates in the Golden Age (Boston: Beacon Press, 2005). The Possibilities of Crisis 177 firm’s supply chain, the thieves are agents of industrial capitalists.129 An example of such integration familiar in the United States from myriad Western films and TV shows has been the theft of cattle by one rancher from another.130 One important kind of intra-capitalist theft is industrial espionage to obtain secret information about production methods or products.131 Marx’s analysis of the diffusion of technological change – often implemented, as we have seen, in response to workers’ struggles – focuses on how any development by one capitalist firm, which gives it a competitive advantage and a larger share of surplus value, is desired by others.132 Where the new technology is easily available, diffusion takes place simply through adapting old plant and equipment or setting up new ones. But the international diffusion of new technology has often come through the migration of skilled workers and entrepreneurs who simply import or build new production facilities. In such a manner, for example, did the silk industry become established in the United States where sericulture had never been successful. Originally protected by tariffs on finished silk goods, the development of the industry was based on imported European technology and Far Eastern raw silk.133 But where the technology has not been freely available, nor skilled workers willing to move, copying was sometimes done by reverse-engineering means of production but often by stealing 129 130 131 132 133 Modern examples include the criminal activities of the Coal Mafia in the Indian coal belt that buys stolen coal from the poor and resells it to power companies. See, Frank Daniel and Matthias Williams, Special Report: The ‘Coal Mafia” plunders India, Thomson Reuters, (May 14, 2013). “Corruption and crime: How coal mafias fuel India’s power crisis,” Reuters, (December 20, 2014). Such rustling has been portrayed not only in movies about the American West but also in those about Australia and other places where ranching is big business. Examples in the US include Conagher (1991), Open Range (2003), or others cited in the Wikipedia entry on range wars. In Australia, the operations of modern cattle “duffers” (rustlers) are seen in “Dirty Pool,” Season 1, episode 14, in the TV series McLeod’s Daughters (2001−2009). Another kind of theft has been practiced by oil and gas companies who used horizonal drilling to tap resources under an adjacent property. Examples abound from the beginnings of industrialization to today. One story, from the nineteenth century is told in Daniel Gross’s article “Industrial Espionage and Cutthroat Competition Fueled the Rise of the Humble Harmonica: How a shrewd salesman revolutionized the instrument industry”, Smithsonian Magazine, September 17, 2014. Capital, Vol. 1, Chapter 12, or MECW, Vol. 35, Chapter 12. See, Debin Ma, “The Modern Silk Road: The Global Raw-Silk Market, 1850−1930,” Journal of Economic History 56, no. 2 (June 1996): 335. On how technologies developed in England were diffused to France, see, Alessandro Nuvolari, et. al., “British-French Technology Transfer from the Revolution to Louis Philippe (1791−1844): Evidence from Patent Data” The Journal of Economic History 83, no. 3 (September 2023): 833−873. 178 chapter 4 information about new products, closely guarded mechanical methods, or chemical processes of production. The more effective such industrial espionage, the faster the diffusion. Such espionage has always been an essential part of “competition” among capitalists. Writing about such methods in the eighteenth century, with a major focus on French spying on British industry, John Harris writes, “Espionage was a major means by which important new technology was actually transferred or attempted to be transferred … It was practiced on a very wide scale by all western countries of any industrial significance.”134 Methods included observation as “tourists” and stealing actual tools, machines, models, plans or formulae. Often essential, however, was enticing those with knowledge to “defect” to another company, either at home or abroad. Industrialists, it seems, either recognized or discovered that without the knowledge of skilled operatives about how to make a new technology work efficiently, stolen tech could be much less productive or even useless.135 This inseparability of technology from labor points to the inherent relationship between the two. It is creative labor, after all, that first invents new technology and then brings it alive in action. So, the separation of MP and LP, e.g., of machines from humans, of “dead” labor from “living” labor is much less clear in actual production processes than it appears in the abstraction of theory. At an international level all these methods, including espionage, have been natural complements to protectionist laws designed to keep foreign competitors out of a country while local late-comer capitalists are investing and trying to “catch up” to the methods and standards of their more able foreign competitors. The degree to which the success of these methods causes a crisis for the company or industry from which the technology is stolen depends upon how much of a market share the newly more competitive production is able to carve out. The logic of the “infant industry” argument for protection explicitly assumes that success in augmenting industrial efficiency will enhance competitiveness and the ability to steal market share and cause a crisis for competitors. 134 135 John Harris, “The Rolt Memorial Lecture, 1984, Industrial Espionage in the Eighteenth Century,” Industrial Archaeology Review 7, no. 2 (1984−1985): 127. Also, John Harris, Industrial Espionage and Technology Transfer. Britain and France in the Eighteenth Century (­London: Routledge, 1998). John Harris provides abundant examples. The Possibilities of Crisis 179 3.3.4 Crises Caused by Time Lags As Marx’s two-department model of expanded reproduction makes clear, the appropriate amounts of MP (and MS for that matter) need to be produced – and available at profitable cost – for both departments. Marx and Engels argued, as early as the 1840s, that such availability is never guaranteed – despite economists’ quasi-religious belief that market dynamics would almost always bring this about. The absence of intersectoral planning and time lags in flows of information sometimes meant overproduction and sometimes underproduction, which produced either excessive or inadequate inventories of available C(MP)’, thus price swings and possible interruptions in expanded reproduction.136 As capitalists extended their operations across oceans, increases in ­distance lengthened the time lag between production and sale and multiplied the possibilities of interruptions. Further: since the circulation process of capital is not completed in one day but extends over a fairly long period until capital returns to its original form … great upheavals and changes take place in the market … it is quite clear, that between the starting point, the prerequisite capital, and the time of its return at the end of one of these periods, great catastrophes must occur and elements of crises must have gathered and developed.137 Remember, Marx was writing during the period of rapid imperialist expansion in which conquest and colonialism were beating down foreign production, creating markets for goods produced in the imperialists’ homelands and opening up new sources of raw materials for processing at home. Means of production were being shipped home on voyages that could take months to complete – months during which buyers could only hope for the timely arrival of the raw materials they needed to continue or expand production. Improvements in transport technology, from horse-drawn carts to railroads, from sailing to steam vessels shortened delivery times and improvements in communication from physical mail to the telegraph shortened lags in knowledge about market conditions, but not enough to remove the problem. The crises of overproduction and over speculation that Marx identified in 1855 applied to 136 137 And sometimes these situations have unfurled in close temporal proximity, see the e­ xample of the Cotton Famine below. MECW, Vol. 32, p. 126. 180 chapter 4 both finished goods being sold abroad, and raw materials being imported for processing. He wrote: the commercial cycle has again reached the point where overproduction and over speculation turn into a crisis … glutting of the world market has been achieved in spite of … the electric telegraph which has transformed the whole of Europe into one big commodity exchange, in spite of railways and steamships which have improved communication and therefore commerce to an incredible degree.138 The same problem of time lags could produce underproduction, the collapse of speculation and a crisis in supply from raw material importers. 3.3.5 Crises Caused by Nature Crises caused by Nature in the ability of investors to obtain the MP they require result from shortages that either drive up the prices of MP to levels that undermine their profitable use or cause such absolute scarcity as to bring those production processes that require them to a halt. Such shortages occur because of catastrophes in either their original production or in their transportation. Dramatic changes in Nature such as drought, tornadoes, hurricanes, cyclones, flood, tsunamis, earthquakes, volcanic eruptions, wildfires, and disease can all have the effect of dramatically reducing either the quality or the quantity of MP, or both. On such crises in the production of MP, see Section 4.2.2.2 below. 3.3.6 Crises Caused by Blockades of Trade Unlike natural disasters, the imposition of blockades on flows of MP have been entirely the result of capitalist and government decisions. Using government-sanctioned patents and copyrights, capitalists have prevented or slowed the flow of new technologies. Governments, using laws, protective tariffs, and force have slowed or prevented flows of actual goods. Yet, these are parallel to natural disasters in their effects: reducing availability and raising prices – increasing costs to firms requiring blockaded MP for their operations. One well-known nineteenth century example of governments intentionally intervening to cut off imports of raw materials were the blockades of imports from the continent to England during the Napoleonic Wars, caused by both 138 Karl Marx, “The Crisis in Trade and Industry,” (Jan. 8−22, 1855) MECW, Vol. 13, pp. 571−578. On the impact of the telegraph and transoceanic cables on international trade in grain see, A. J. H. Latham and Larry Neal, “The International Market in Rice and Wheat, 1868−1914,” The Economic History Review, New Series, 36, no. 2 (May 1983): 273−274. The Possibilities of Crisis 181 Napoleon’s interdiction of trade with Britain and the British blockade of French ports.139 The cut-off drove up the price of grain, hence of bread, undermining real wages and causing worker unrest. A parallel blockade was enacted by Thomas Jefferson with the Embargo Act of 1807 that outlawed trade with either Britain or France – partly in response to the impressment of American sailors by the British Royal Navy, partly as another protectionist measure to favor the development of domestic industries. At the end of the wars, against the expected resumption of grain imports, landlord lobbying in Britain led to the Corn Laws that restricted imports, kept local grain prices and rents high and prompted further conflict.140 Despite continued opposition from manufacturers and workers, they were only repealed in response to the disastrous collapse in food production in Ireland that brought on the Great Irish Famine, mass starvation and emigration from Ireland.141 139 140 141 Revealing fiction, because based on real historical sources, including the Naval Digest, that tell stories of these blockades can be found in the Aubrey/Maturin novels of Patrick O’Brian. The story line of the 2003 film Master and Commander: The Far Side of the World was extracted from the novels’ stories. Such government-imposed blockages of imports predated the Corn Laws and have been repeatedly used in the years since. The motives behind such blockages have often been mixed, sometimes economic, e.g., to benefit domestic producers, and sometimes political, e.g., aimed at wartime enemies or to punish other governments for some reason. Raising prices for domestic producers were behind not only the Corn Laws but the many protectionist measures discussed in Section 4.3.3.2. below. Napoleon’s interdiction of trade with England was a political act of war. Obviously, the distinction has limited meaning when embargoing trade is both an economic act and a political one. In recent decades, we have seen the US impose a whole series of overtly political embargos although they have often served economic interests as well. An obvious case has been the embargo of all trade with Cuba. Because Cuba was a major sugar producer and exporter, this has obviously been of great benefit to sugar producers in the US. The embargos of Vietnam and Iran after their revolutions, of arms with Argentina and South Africa over human rights abuses, of grain to Russia after its invasion of Afghanistan in 1980, of exports to some oil importers by OPEC in 1973−4, of Iran by the US and European governments after its revolution in 1978, and of Russia again after its invasions of Ukraine in 2014 and 2022, are all examples of actions that have been explicitly politically motivated but with substantial economic effects. Although beyond the scope of this treatment, and despite being ignored by many Marxist treatments of wars between capitalist nation states, class struggle always plays a role in their genesis, evolution and ends. This is obvious in the case of Napoleon’s empire building in the wake of the French Revolution (1789). It’s also obvious in the runup to the Civil War in the US, which was preceded by slave revolts in Haiti (1791−1804) and the slave states. In the twentieth century it was obvious as the Russian Revolution of 1917 extricated that country from WWI and throughout the anti-colonial, independence struggles that dominated much of the century. Class struggle was also a determining factor during the Cold War as the specter of nuclear holocaust was wielded by both the Soviet and US 182 chapter 4 Another example of blockade in M – MP that Marx traced, in part through Factory Inspector Reports, one which contributed to a crisis in the English textile industry was the Cotton Famine (1861−1865) during the U.S. Civil War. First the Confederate states embargoed cotton exports in 1861 and then the North blockaded southern ports – much as the English had blockaded French ones sixty years earlier. The crisis actually began with excessive, speculative stockpiling of raw cotton, a previous overproduction of cotton yarn and cloth that had glutted markets and caused cutbacks in production and growing unemployment among mill workers. This was soon followed by the cutoff in supplies from America and a dramatic rise in the cost of cotton, reduced production and even greater unemployment – nearly 500,000 workers laid off.142 When desired cotton became either unavailable or too expensive, then regardless of how much money was available, prior investments could not be renewed, nor new ones undertaken until alternative sources could be tapped, e.g., cotton from India or Egypt.143 I return to this case in Chapter 6 on offsetting strategies. That historical experience reveals a further problem: reduced quality of MP caused by being forced to switch from preferred sources to secondary ones. The cotton obtained from India turned out to be of a much lower quality than that from the United States – which raised the costs of production and undermined both the quality of the product and profitability.144 4 Possibilities of Crisis in the Second Stage of the Circuit: Production In the second, production stage of the circuit (… P … C′), the possibility exists that despite having acquired and purchased the two elements of production, 142 143 144 governments as a means of domestic social control. Orwell’s novel 1984 (1949) captured, among other things, the usefulness of endless foreign conflicts for domestic control. Eugene Brady (1930−1991) argued that because of previous stockpiling the cutoff caused no dearth of cotton for the mills, rather the fear of future dearth, combined with previous overproduction, caused a dramatic increase in the cost of cotton, a decrease of production and an increase of unemployment. See, Eugene Brady, “A Reconsideration of the Lancashire ‘Cotton Famine’,” Agricultural History, Vol. 37, no. 3 (July 1963): 156−162. See, Marx’s journal articles of 1861 on the “Cotton Crisis” in MECW, Vol. 19 and his analyses in Volume 1 of Capital, Chapter 15, Section 7, pp. 575−588, or MECW, Vol. 35, pp. 450−462, Manuscript of 1864−65, pp. 232−236, Capital, Vol. 3, Chapter 6, Section 3, pp. 219−225, or MECW, Vol. 37, pp. 125−130. Besides being more expensive, working shorter, dirtier Egyptian and Indian cotton slowed down machinery, further reducing productivity, wages and profits. Capital, Vol. I, p. 585, or MECW, Vol. 35, pp. 459−460, Manuscript of 1864−65, pp. 237−238, Capital, Vol. 3, pp. 228−233, or MECW, Vol. 37, pp. 132−136. The Possibilities of Crisis 183 LP and MP, capitalists may fail to achieve their transformation into the final product C′ in a way that the value of C′ is sufficient to provide, if sold at its value, at least an average rate of surplus value or profit. This is true whether we are dealing with the production of C(MP)’ or that of C(MS)’. This possibility of crisis at the point of production must involve either a failure to extract enough work from enslaved or hired labor-power or some breakdown in the means of production. Possible causes of such failures can be either internal to the dynamics of production or external, e.g., disruptions due to “natural” disasters. 4.1 Possible Crises with Labor-Power, LP in … P … For reasons, which I analyze in Chapter 5 on predispositions to crisis, the labor processes of capitalist production are rife with conflicts between workers and capital – conflicts that can evolve from sporadic individual resistance to collective organization and action – and have the potential to disrupt and precipitate crisis. 4.1.1 Enslaved or Hired, But Will They Work? Resistance to Work In both cases, of slavery and waged labor, obtaining workers is only the first step in obtaining the labor necessary for the production of commodities. In the case of slaves, force or the eminent threat of force is usually required in an ongoing manner to get slaves to do the work desired. From reports from America, Marx and Engels were aware of the resistance of slaves that made that force necessary. In the case of waged or salaried labor, in principle, the only force required is the threat of everything that can be lost through the loss of a job. However, every capitalist discovers it is one thing to hire workers’ capacity to work, LP, but it is quite another to extract sufficient living labor, … P …, not only to preserve the original value invested, v + c, but also to extract surplus labor and generate surplus value, s.145 For the capitalist, success in production appears “totally identical with the production of surplus labor …”146 Therefore, 145 146 Although this has always been clear to capitalist managers, it took a remarkably long time for economists to recognize that “labor” was no simple input, such as the “L” hypothesized in production functions of the sort Q=f(K, L). It was not until the recognition of how “efficiency wages” (those intentionally higher than market clearing rates) could result in more work and higher productivity that they effectively acknowledged the difference Marx had noted long before, between the “ability and willingness” to work (LP) and actual work. Sociologists and psychologists were studying this issue much earlier – paid by capitalists to help manage discontented workers – creating specialized fields such as “industrial sociology” and “industrial and organizational psychology.” Grundrisse, p. 404, or MECW, Vol. 28, p. 331. 184 chapter 4 the central issue for both capitalists and the workers they hire is just how much work will actually be forthcoming. In other words, will capitalists succeed in exploiting their workers? And, will they succeed in exploiting them enough to be competitive with other capitalists trying to do the same? Will their s/v and s/(v + c) reach at least average levels (and preferably exceed them)? It all depends on just how much work they can get their workers to do. Although capitalists do their best to hire workers who seem both able and willing to do the work they need done, the degree of both are only truly revealed on the job and may disappoint capitalists’ hopes and expectations.147 No matter prior conditioning and training, there is much truth in the wellknown maxim that “most of what you need to know, you learn on the job.” (This is true about both how to do the job, and how to resist it!) Much the same is true with respect to willingness. Not only do workers often hide their resistance to work while seeking jobs and agreeing to terms of employment, but because conditions on the job vary, both by task and over time, so may willingness. Regardless of agreements concluded in M – LP, more often than not in …P… capitalists try to squeeze out a bit more labor, even at the cost of the workers’ safety and health, while workers try to limit their work, to make it safer and to conserve energy for their own personal lives off the job.148 This will be especially true if, once on the job, they find their work unsafe. Such discovery can undermine initial willingness and provoke varying degrees of resistance. In value terms, all worker resistance that takes the form of less work undermines the total amount of value added, v + s, to the means of production, c. In what follows, I examine some of the ways workers work less, reducing v + s. Here I look only at possible ways of working less – albeit demonstrated in history – reserving analysis of why they resist for Chapter 5, Section 2 on predispositions to crisis within the sphere of production. Given that the amount of work is determined primarily by the time of labor (how long workers work) and by the intensity of that labor (how hard they 147 148 See, George Caffentzis’ insightful analysis of capitalist efforts to choose those workers most willing to channel their energy into work, i.e., those with the lowest entropy, in his, “The Work/Energy Crisis and the Apocalypse,” Midnight Notes II, Vol. 1 (1980). See too any of the numerous business publications on “personnel” selection written to guide the evaluation of potential hires. See, Marx’s analysis of capitalist “nibbling and cribbling” to increase work in Chapter 10 of Volume 1 of Capital and my highlighting of workers’ methods of achieving the opposite in my commentary on that chapter. Capital, Vol. 1, p. 352, or MECW, Vol. 35, p. 250. Cleaver, 33 Lessons on Capital, 235−236. The Possibilities of Crisis 185 work), the most obvious possibilities of crises caused by less work and less v + s, are workers spending less time working or working less intensely than their employers’ desire. In terms of time, the most obvious potential (and historically very real) source of conflict was over the length of the working day – to which Marx devotes Chapter 10 of Volume 1 of Capital, one of the longest in the book. As he shows, this wasn’t just a possibility, but a source of repeated crises in accumulation as capitalists, their workers and social reformers battled repeatedly over what should constitute a “normal” working day. Although at any point in those battles, the length of a working day was often formally determined – by verbal agreement or by law – the actual number of hours, minutes and seconds of work could vary enormously. When and where craftworkers controlled their tools, e.g., where the subordination of labor was only formal, they could start and stop work at will, opening what Marx sometimes called “pores” of non-work in the working day and thus reducing its actual length. Early examples were spinners and weavers who controlled the speed of their spinning wheels and hand looms. Later examples were skilled machine tool operators, those who used machines to make machines or machine parts, and steel workers who long acted as both as engineers, designing tools and processes, and as manual workers, putting them to use. A parallel dynamic existed with respect to intensity. Just as workers who controlled their tools could take breaks, stop and start as they pleased, so too could they control the intensity of their work; they could modulate the rhythm of work, sometimes working hard and fast, sometimes taking it easy, depending on circumstances (such as how much they could earn for a given amount of labor or how much they needed to earn).149 But even where workers were assigned to merely tend machines that capitalists tried to run continuously to minimize down time and costs while maximizing output, workers were not without recourse. One obvious way of achieving down time for workers tending machines whose speed is controlled by their bosses is sabotage. Sabotage sometimes has taken the form of machine breaking, overt in cases such as the Luddites, covert in many others. Those who work with machines, hour after hour, day after day, often come to know them even better than their designers. That knowledge 149 Thanks to the United Farm Workers providing almost daily postings on Twitter, we have plenty of illustrations, with videos, of how, under varying circumstances, farm workers – who are often paid piece-wages – vary the rhythm of their work. When conditions ­warrant, e.g., low piece rates and bad weather, they are forced to work faster and harder to earn enough to live. When conditions are better, either higher piece rates, better weather or hourly wages, they can earn enough with less intense work. 186 chapter 4 makes it possible for them to either make the machines safer and more productive or utilize them in ways that cause them to break or otherwise stop functioning and require unscheduled repair and maintenance – a break in the rhythm of work, whether workers repair their own machines or someone else must be called in to do it. Other possibilities of rupture in work time include various forms of intentionally working less, e.g., workers sleeping, playing or organizing on the job instead of working, absenteeism (coming in late and/or leaving early), slow-downs, strikes, protests and uprisings. Sleeping or playing on the job has sometimes involved sabotage, sometimes merely carefully planned diversions of energy.150 Examples of collective slow-downs are often found in cases of piecework, where wages depend on how many “pieces” are produced, be they pounds of yarn spun by spinners, yards of cloth woven by weavers, crates of fruit picked by farm workers, or tons of ore extracted by miners. In such cases, workers sometimes collaborate to limit the number of “pieces” each produce – ­effectively slowing down production. One of my favorite short stories by Jack London is “South of the Slot” (1909) which recounts how a new employee is called out by a veteran for working too hard and messing up the piece rate. By producing more than the others, he risks giving the boss an excuse to lower their piece rates, forcing everyone to work harder.151 In such a manner do workers often refuse competition among themselves and collectively set upper limits to how many pieces each will produce and thus just how much work they will do. Shopfloor organizing – organizers talking with other workers about problems and possible actions – clearly takes time away from work and often involve preparation for taking more time, e.g., strikes.152 Strikes may be officially sanctioned by law, e.g., pre-contract contestation between unions and employers, or unsanctioned wildcat actions by rank & file workers. They may involve walking off the job, occupying plants and preventing the replacement 150 151 152 See, the examples in Bill Watkin’s “Counterplanning on the Shopfloor,” Radical America, May-June 1971, pp. 77−85. See, Donald Pizer (ed.), Jack London: Novels & Stories (New York: Library of America, 1982) 817−833. A more recent story of learning [to work less]-on-the-job, in a different setting, is told in Patti Smith’s autobiographical song “Piss Factory” (1974) on New Wave, Vertigo Records, 1977. Eventually, long after Marx and Engels time, workers in some industries won time for such organizing on the part of shop stewards or union reps with no loss of pay. When reaction to the Japanese “invasion” of the US auto industry in the 1970s resulted in “quality circles” to improve labor productivity, they were often used by workers as breaktime, rather than just another form of work. The Possibilities of Crisis 187 of striking workers by scabs – all of which bring work and production to a halt, rupturing circuits and reproduction. The same is true with widespread protests and uprisings, e.g., Chartist protests against Parliament inaction on their petitions or the Revolutions of 1848. Workers walking off the job and into the streets in large scale actions – especially general strikes and revolutions – may rupture not only production but other moments of the circuit as well – such as M – C(MP, LP), discussed in Section 1 above, or C′ – M,” discussed in Section 3 below. Whatever the cause, workers do get fed up with the work and even with the struggle over work, declare “Take This Job and Shove It!”!” and quit. Walking away obviously means less work by those who walk and the diversion of managerial time into replacing workers who quit. 4.1.2 “Nature” Can Kill In Section 3.3.5 on possible problems in buying the means of production, I discussed how drought or flood could decimate crops used as MP, reducing supply, driving up prices, reducing capitalist profits and causing a crisis. Obviously, drought or flood can also reduce food crops (MS), also driving up retail prices and undermining the value of workers’ wages. Where wages are already low, reductions in what they can buy brings deeper malnutrition, greater susceptibility to disease, loss of housing, even starvation – all reducing the ability of workers to work and, in the worst cases, killing them outright. The disease that blighted potatoes in Ireland, also resulted in some workers starving and others fleeing the workforce through emigration to escape the same fate. Any natural disruption – whether by flood, drought, or disease – of any crop that feeds local workers can have much the same effect of reducing available labor-power – as demonstrated dramatically in the multiple nineteenth century famines of South Asia.153 Severe storms, tornadoes, fires, and flooding can also damage or destroy manufacturing factories and in the process harm the workers who work in them, regardless of the nature of their final product. Earthquakes that crumble factories or whole towns crush workers as well as machinery and other means of production. 153 These natural devastations have continued to plague the labor force in the twentieth and twenty-first centuries, especially in South Asia and Sub-Saharan Africa, e.g., famine in India in 1967, drought throughout the Sahel in the early 1970s and most recently – ­augmented by global warming – drought and famine have been driving massive displacements of population in Africa. 188 chapter 4 Similarly, hurricanes, cyclones or dangerous coasts that sink or wreak ships can also kill their sailors. Or, if they keep ships confined to ports, they keep sailors on shore and dock workers idle, reducing their work and the production of transportation. Clearly, the recurrent epidemics and pandemics of the nineteenth century sickened and often killed workers removing them either temporarily or permanently from working and by so doing disrupted production. With working-class wages so often at or near bare subsistence, the ravages of disease simply worsened the health of workers already weakened by chronic malnutrition, killing more quickly than slower deaths by starvation. Not only were such sufferers removed from labor markets as I discussed in Section 4.1.2.3.1., but their deaths removed them from the labor force entirely. 4.2 Possible Crises with Means of Production, MP in … P … Keeping in mind that the means of production are determined by the technology of production, embodied in tools, machinery and raw materials, there are several possibilities of crises in production associated with some breakdown in these. They include workers’ actions, e.g., sabotage and direct appropriation, natural disasters and, for individual capitalists, the inability to cope with inevitable depreciation or keep up with technological changes introduced by competitors. 4.2.1 Crises in MP Caused by Workers’ Actions The most immediate and obvious possibilities of crisis in production associated with the means of production are those caused by workers in their conflicts with capitalists over priorities. Whereas for capitalists the maximization of profit involves minimizing not only wages but also other costs, including expenditures on worker safety, workers demand measures to protect themselves on the job and laws to mandate protections. In Section 2 on “Saving on the Conditions of Work at the Workers’ Expense” of Chapter 5 on “Economy in the Use of Constant Capital” in the Manuscript of 1864−65 and in Volume 3 of Capital, Marx provides many examples of such cost cutting – or refusal to spend – often at the expense of worker safety.154 During conflicts over these opposed sets of priorities, workers sometimes resort to sabotage: the breakage of tools and machinery, the destruction or contamination of raw materials, the burning down of factories. While capitalists try to forbid “… all wasteful consumption of raw material or instruments of labor … because what is wasted 154 Manuscript of 1864−65, pp. 156−179, Capital, Vol. 3, pp. 181−190, or MECW, Vol. 37, pp. 80−106. The Possibilities of Crisis 189 in this way represents a superfluous expenditure of quantities of objectified labour, labour that does not count in the product or enter into its value,”155 Marx was well aware that this aim was often thwarted by workers. In a footnote to this description, he draws on writings by John Cairnes (1823−1875) and Frederick Olmstead (1822−1903) to describe how capitalists in the slave states of the US were forced to give their workers crude tools because of the workers so frequently broke them.156 Although they partly attributed this to what they considered slaves’ racial inferiority, they also recognized resistance. Cairnes takes the following from Olmstead’s Seaboard Slave States: In working niggers, we must always calculate that they will not labour at all except to avoid punishment, and they will never do more than just enough to save themselves from being punished, and no amount of punishment will prevent their working carelessly and indifferently. It always seems on the plantation as if they took pains to break all the tools and spoil all the cattle that they possibly can, even when they know they’ll be punished for it.157 155 156 157 Capital, Vol. 1, p. 303. When Marx writes “does not count in the product or enter into its value,” he is telling us the real meaning of a failure to “transfer” or “preserve” value in a way that demystifies the usual interpretation of these terms. See, the commentary on Chapter 8 in H. Cleaver, 33 Lessons on Capital. Ibid., fn 18, pp. 303−304. It seems likely slaves played on white racism, which would ­attribute breakage to the stupidity of their black slaves. As with machine breakage, tool breakage results in work stoppages and perhaps the diversion of energy into more interesting repair work. John Cairnes, The Slave Power: Its Character, Career, and Probable Designs: Being An Attempt to Explain the Real Issues Involved In the American Contest, 2nd ed. (New York: Carleton, Publisher, 1862) 40, fn*. Omstead and Cairnes’ and hence Marx’s perception of how slave resistance prevented the use of the best tools, has been countered by a considerable literature demonstrating that this was not always so. Moreover, it is noticeable that Marx did not share their judgement of slave innate inferiority but clearly saw tool breakage purely in terms of resistance by exploited workers. Indeed, it has been shown that in some places slaves worked as artisans rather than field labor and, moreover, seem to have contributed to developing new, more efficient technologies. See, Veront Satchell, “Innovations in sugar-cane mill technology in Jamaica, 1760-−1830” in Verene Shepherd, Working Slavery, Pricing Freedom: Perspectives from the Caribbean, Africa and the African Diaspora (New York: Palgrave, 2001) 93−111 and Jenny Bulstrode, “Black metallurgists and the making of the industrial revolution,” History and Technology 39, no. 1 (June 2023): 1-41. Regardless, given how frequent the resort to sabotage has been throughout capital’s labor force, including wage labor, it seems likely that some slaves also mistreated their owner’s tools in acts of resistance. 190 chapter 4 To the degree that Cairnes was correct that the “maxim of slave management, in slave importing countries [is] that the most effective economy is that which takes out of human chattel in the shortest space of time the utmost amount of exertion it is capable of putting forth” sabotage of the means of production would seem one natural response by workers.158 Such conflicts were widespread in the nineteenth century not only among slaves but also among wage-slaves. Turning to industrializing Britain, where slave-produced cotton was being processed into cloth with ever-more sophisticated machinery, Marx observed the same conflict between workers’ desire to work less and capitalists’ desire to extract the most work possible. As early as 1846, while critiquing Proudhon, he wrote, “Since 1825, the invention and use of machinery resulted solely from the war between masters and workmen.”159 On the basis of his worked out theory of relative surplus value, he reiterated this theme in Capital, explaining how the introduction of machines, which held the technical possibility of reducing work was used by capitalists to increase work and undermine workers’ power to resist. Hence too the economic paradox that the most powerful instrument for reducing labor-time [machines] suffers a dialectical inversion and becomes the most unfailing means for turning the whole lifetime of the worker and his family into labor-time at capital’s disposal for its own ­valorization.160 Simultaneously, machinery, he wrote, serves employers as The most powerful weapon for suppressing strikes, those periodic revolts of the working class against the autocracy of capital … It would be possible to write a whole history of the inventions made since 1830 for the sole purpose of providing capital with weapons against working class revolt.161 Not surprisingly, workers resented these capitalist uses of machinery. Although the best known acts of sabotage were those of the Luddites (1811−1816), English 158 159 160 161 Quoted in Capital, Vol. 1, p. 377, from Cairnes, The Slave Power, p. 73. Marx to P. V. Annenkov, December 28, 1846, MECW, Vol. 38, p. 99. Capital, Vol. 1, p. 532, MECW, Vol. 35, p. 411. Ibid., p. 563, MECW, Vol. 35, p. 439. Also: “Since 1825, the invention and use of machinery resulted solely from the war between masters and workmen.” Marx to P. V. Annenkov, December, 28 1846, MECW, Vol. 38, p. 99. The Possibilities of Crisis 191 handloom weavers and textile workers who destroyed machinery that displaced their labor and drove down wages, Marx recounts many such acts d­ ating back to the seventeenth century.162 Among which: “… nearly all of Europe experienced workers’ revolts against the ribbon-loom, a machine for weaving ribbons and lace trimmings …” And then “No sooner had Everett constructed the first wool-shearing machine to be driven by water-power (1758) than it was set on fire by 100,000 people who had been thrown out of work.”163 Similar actions against machines have been undertaken by agricultural workers. These included the widespread “Swing Riots” in 1830 against mechanization in agriculture and involved the destruction of labor-displacing threshing machines.164 Machines were not the only objects of anger and attack but unfolded alongside “the underground of the poaching war, the anonymous letter and the flaming corn rick.”165 By fits and starts such rebellion would become gradually better organized, leading eventually from the struggles and subsequent repression of the Tolpuddle Martyrs in 1834 to the “formation since the end of 1865 of a trade union among the agricultural labourers … in March 1867, the labourers carried through a general strike …”166 162 163 164 165 166 On the Luddites see Charles Poulsen, The English Rebels (London: Journeyman, 1984), David Noble, Progress Without People: In Defense of Luddism (New York: Charles Kerr, 1993) and Peter Linebaugh, Ned Ludd & Queen Mab: Machine-Breaking, Romanticism and the Several Commons of 1811–12 (Brooklyn: PM Press, 2012). One literary portrayal of such actions is in Charlotte Brontë’s novel Shirley (1849) where both sides are represented in a dialog, where the workers argue for saving their jobs and the capitalist argues he has no choice, given the competition of other capitalists – the very dynamic of inter-capitalist competition Marx analyzes in Chapter 12 of Capital as one vehicle for the spread of technological innovations. It also illustrates how the relative ability to compete depends on a capitalist’s relative control over his workers. Capital, Vol. 1, p. 554, MECW, Vol. 35, pp. 430−431. On the Swing Riots see Eric Hobsbawm and George Rudé, Captain Swing (London: ­Lawrence & Wishart, 1969). For a broader view, see E. P. Thompson, The Making of the English Working Class (New York: Vintage Books, 1963), Chapter Seven, “The Field Labourers.” The development and adoption of labor-displacing machinery in agriculture has ­continued, often in response not merely to the rise in wages but the anticipation of a rise in wages. An example of the former was the mechanical reaper in the American MidWest. See, Paul David, “The Mechanization of Reaping in the Anti-Bellum Midwest” in Henry Rosovsky, ed., Industrialization in Two Systems (New York: John Wiley & Sons, 1966) 3−39. An example of the latter was the development of tomato picking machines in the 1960s in response to the successful formation of farm worker organizations. See, Jim Hightower, Hard Tomatoes, Hard Times: A Report of the Agribusiness Accountability Project on the Failure of America’s Land Grant College Complex (New York: HarperCollins Publishers, 1978). Thompson, The Making of the English Working Class, 225−226. Capital, Vol. 1, p. 363, fn 54, MECW, Vol. 35, p. 260, fn 1. 192 chapter 4 As capitalist accumulation extended its reach beyond national borders through colonialism, one basic objective was the acquisition of raw materials at a lower cost than could be produced domestically. From the British annexation of Ireland as a source of first wool and later flax through the colonization of India facilitating the acquisition of cotton to Belgium’s conquest of the Congo for its mineral wealth, the international spread of raw material sourcing simultaneously involved the creation of new sites of workers’ struggles over their production.167 Another terrain of the production of MP that proved highly susceptible to worker sabotage was mining. As coal-fed steam engines replaced water-­ powered machinery in factories and transportation, the power of coal ­miners to disrupt accumulation, not only in the mines but also downstream in the industries dependent on their product, grew steadily. Given the d­ angerous character of the work, mine owner reluctance to invest in safety measures, and the support of isolated mining communities, the struggles of coal miners, all over the world, are legendary, from the Molly Maguires in Britain and the United States to miners in France, Silesia and India.168 Miners, with easy access to mining equipment, including explosives, have the means not only to shut down mines but also to interrupt the transportation of ore from pit to where it would be employed. Such power forced mine owners to draw upon both private police, e.g., the Coal and Iron Police, and government military force to repress miner struggles. Those same conditions obtained in many other kinds of mines.169 167 168 169 Although the English economist John Hobson in his Imperialism: A Study (1902) emphasized underconsumption and the consequent need for new markets as the “taproot” of colonial expansion, he recognized that the search for both cheap raw materials and new, more profitable investment opportunities were also prime motivations. So did Vladimir Lenin (1870−1924) in his Imperialism, the Highest Stage of Capitalism (1917) and Nicholai Bukharin (1888−1938) in his Imperialism and World Economy (1917). Among the many expressions of mining struggles in literature see Emile Zola, Germinal (1884−1885) based on the author’s investigative reporting in the coal mines of Northern France – frequently adapted to film. Twentieth century miners’ struggles exploded in the US in the 1920s, as illustrated in John Sayles’ magnificent film Matewan (1987) and continued in the decades that followed. See, William Blizzard, When Miners March (edited by Wess Harris) (Oakland: PM Press, 2010), Wess Harris, Truth be Told: Perspectives on the Great West Virginia Mine War: 1890 to Present (Gay, WV: Appalachian Community ­Services, 2015), William Cleaver, “Wildcats in the Appalachian Coal Fields” Zerowork 1 (1975): 113−127, and the documentary Harlan County, USA (1976) about a 1973 strike by Kentucky coal miners. In recent years, the rise of struggles to protect the environment has resulted in miners gaining three new sources of support in their struggles. Ecological and human rights activists have joined with indigenous people, whose lands have been threatened or The Possibilities of Crisis 193 Alongside such possible destruction of the means of production, workers also often threaten capitalists’ organization of production by directly appropriating – on-the-job – the raw materials with which they have been working, the tools they have been using and the wealth they have been producing. (See, Chapter 4, Section 3.3.3.1) Where workers have had some control over the disposition of their raw material, e.g., silk or leather workers in the eighteenth century, who were supplied with fabric or leather by merchant capitalists, they could cut the material in ways designed to leave usable scraps that they could shape into objects for their own use or for sale to supplement their income. Such direct appropriation, or “wasteful consumption,” obviously raised costs and reduced profits for employers.170 Of course, workers have not only appropriated scraps, but have often appropriated directly usable elements from fields, offices and factories, e.g., food, office supplies or means of production (from raw materials to intermediary parts).171 Such worker appropriation of things parallels the appropriation of their time previously discussed. 4.2.2 Crises in the Production of MP Caused by Nature I have already noted how interruptions due to exogenous changes in Nature may hurt workers and reduce the availability and efficacy of their labor-power. Such changes can also undermine the production and quality of the means of production. This is probably most obvious in extractive industries such as agriculture and mining. In Marx and Engels’ accounts, the example of crises in the production of MP that shows up most often is that of agricultural raw material production – especially crops – being disrupted by bad weather. Drought can reduce yields, even completely wipe out harvests. When prolonged, drought can undermine irrigation systems by drying up their sources of water, be it from reservoirs or aquifers. Its counterpart, storms, heavy rains and flooding, can disrupt the growth of crops (via “lodging” or drowning), their harvesting, 170 171 destroyed by mining, to resist and disrupt production. Critical focus on this particularly destructive area of capitalist activity has given new prominence to the term extractivism, i.e., exploitation of both miners and the earth in the mining industry. See, for example, Michael Becerril, Resisting Extractivism: Peruvian Gold, Everyday Violence, and the Politics of Attention (Nashville: Vanderbuilt University Press, 2021). See, Peter Linebaugh’s analysis of such methods in his The London Hanged, Part Three: Industry and Idleness in the Period of Manufacture, 1750−1776, especially Chapters Seven and Eight. Until criminalized, such scraps complemented money wages as part of workers’ income. The appropriation of machines for personal use is described in great detail in Miklós Haraszti, A Worker in a Worker’s State (New York: Penguin, 1977) about how ­Hungarian workers use the machines in their bosses’ factory to make “homers.” An amusing hymn to such appropriation in the age of the automobile is Johnny Cash’s song “One Piece at a Time” (1976). 194 chapter 4 and their irrigation systems.172 Both animal and plant populations can also be decimated by disease, either local or pandemic, as was amply demonstrated by the “potato blight” discussed in 1.2.3.1.173 In January of 1853, Marx speculates that poor winter crops will bring on crisis.174 When poor spring crops followed, Engels suggested that “the present prosperity cannot last beyond the autumn.”175 Again in 1856, discussing factors underlying the monetary crisis of the time, Marx points to crop failures, floods, and the failure of European silk crops.176 And in his Grundrisse notes against Darimon, who recognizes grain crop failures but attributes crisis to the drain of bullion, Marx not only complains that “he forgets the failure of the silk harvest” but goes on to argue The replacement of a sudden or chronic shortage of (grain, tea, cotton, flax, etc.) in the case of a domestic crop failure deprives the nation doubly. A part of its invested capital or labour is not reproduced – real loss of production. A part of that capital which has been reproduced has to be shifted to fill this gap … A crisis caused by a failure in the grain crop is therefore not at all created by the drain of bullion … Exports of gold are not the cause of the grain crisis, but the grain crisis is the cause of gold exports.177 In the case of mining, veins of ore can dwindle, or the percentage of useable metal in ore drop below levels worth extracting and processing, given the 172 173 174 175 176 177 Appearing random to observers in the nineteenth century, the extent and frequency of drought and flooding, like wildfires and hurricanes, are now understood to be influenced by human practices. “Human-caused” (i.e., capitalist caused) climate change is now recognized as causing many of these “natural” phenomena to occur more frequently and to be more severe. Although I have yet to come across any reference in Marx and Engels’ writings, a similar blight devastated European viticulture in the late 1850s to the mid-1870s, especially but not uniquely in France. Marx to Engels, 29 Jan. 1853, MECW, Vol. 39, pp. 274−277. Engels to Weydemeyer, 12 Apr. 1853, MECW, Vol. 39, pp. 303−311. Marx, K. “The Causes of the Monetary Crisis in Europe,” (circa October 14, 1856) MECW, Vol. 15, pp.117−122, and “The Monetary Crisis in Europe -- From the History of Money ­Circulation,” (circa October 17, 1856) MECW, Vol. 15, pp. 123−129. Grundrisse, pp. 120, 127−130, or MECW, Vol. 28, pp. 58−59, 65−68 The Possibilities of Crisis 195 current technology and value of material being mined.178 The same holds with oil and gas wells as reservoirs are drained and extraction costs increase.179 Finally, severe storms and flooding can also wreak havoc on factory production as well as on agriculture, thus disrupting the production of both intermediary, manufactured means of production and final products. Storms can also disrupt shipping, especially transoceanic shipping where bad weather and other natural hazards, e.g., dangerous coasts or rogue waves can sink ships, pandemic human disease can shut down ports, and disrupt supplies of MP.180 4.2.3 Depreciation and Competition While raw materials must be replaced regularly so too, eventually, must machinery and other elements of “fixed capital,” e.g., factories, barns, grain silos, irrigation systems, oil and gas drilling and refinery equipment, trucks, trains and ships. They all wear out or “depreciate” over longer periods of time and must be replaced (in part or in whole) in a timely manner to avoid ruptures in the production process. Marx discusses depreciation, both physical and in terms of value in his analysis of machines and industry in Volume 1 of Capital.181 In Volume 2, Section 3, his reproduction schemes explicitly include the replacement of MP due to depreciation (and any other losses). Leaving aside unforeseeable accidents, in which mine tunnels, bridges or roads collapse, refinery equipment or storage facilities explode, trucks and 178 179 180 181 While technological advances in ore mining have sometimes involved the machinery of direct extraction, e.g., the replacement of pickaxes in deep coal mining by Continuous Mining Machines and in open pit surface mining of hand tools by giant electric shovels and draglines, just as important have been the development of new technologies in metallurgical engineering or ore processing which have made it possible to profitably extract valuable metals from ores with ever lower proportions of metals to mineral deposit. Here too, technological advances in discovery, drilling, pumping, transporting, and refining have made ever greater mining and recovery of petroleum and natural gas possible. Controversy over the most recent innovation – hydraulic fracturing or “fracking” – has added to growing opposition to the use of hydrocarbon fuels because of their contribution to global warming. As in the recent case of the Covid pandemic that seriously disrupted global shipping and supply chains. Depreciation in terms of value involves not only wearing out but drops in the value of existing machines in the presence of newer, more efficient ones – a common phenomenon that undermines the competitive profitability of those stuck with the old machines. Marx analyses this in his discussion of how competition results in the diffusion of new technology – when capitalists can afford it, they replace the old with the new – to maintain their share of relative surplus value. See, Capital, Vol. 1, Chapter 12, or MECW, Vol. 35, Chapter XII. 196 chapter 4 trains crash, ships sink, or factories and other equipment are destroyed by the kinds of natural disasters mentioned above, rates of depreciation and therefore of replacement once learned by experience are largely predictable and are incorporated into investment plans. But in this, as with all capitalist investment, things do not always pan out as planned. The timely replacement of fixed capital can fail, disrupt reproduction, and cause a crisis. One well-known cause of the failure to replace failing fixed capital has been the simple refusal of capitalists to spend the money necessary. Simply putting off such investment can have catastrophic consequences, as when factories collapse or blow up due to postponed repairs.182 But beyond the failure to replace existing fixed capital, can be an inability to match technological innovations introduced by competitors who are able to raise productivity, reduce costs and gain a larger share of total surplus value. What may be true of an individual capitalist enterprise may also be true of large numbers, indeed, of whole industries. Marx and Engels watched this unfold as English industrialization surged ahead of that on the European mainland and further afield. They wrote of it lyrically in the Communist Manifesto, calling the “cheap prices” of commodities (because produced with more productive technology) “the heavy artillery” which “batters down all Chinese walls.”183 It is true that such metaphorical artillery was often accompanied by quite material artillery and other machinery of war carried by armies and gunboats, but the failure of some producers to match the innovations of others, for whatever reason, meant crisis for them. Marx set out essentially the same argument in his opening chapter (12) on relative surplus value and how innovation by one capitalist “forces his competitors to adopt the new methods.”184 Unfortunately for many competitors, anywhere in the world, they may find that adoption impossible – creating such a crisis for them that their businesses go bankrupt and fail completely. 4.3 Possible Crises Caused by a Rising Organic Composition of Capital In previous writings, but especially in Capital, Volume I, Part 4 on the “­Production of Relative Surplus Value”, Marx lays out both the history and the logic of the tendency for capitalists to raise both the technical (MP/LP) 182 183 184 A contemporary example – as I write – has been the failure of Southwest Airlines to update its computer equipment, which failed to cope with the severe winter weather in December 2022, resulting in large numbers of canceled flights and stranded passengers. “Southwest put investors ahead of its customers and employees,” Washington Post, December 28, 2022. MECW, Vol. 6, p. 488. Capital, Vol. 1, p. 436, or MECW, Vol. 35, p. 312. The Possibilities of Crisis 197 and organic (co/vo) compositions of capital. He analyzes the shifting of capitalist investment to increase MP relative to LP, e.g., by buying and deploying machines, within two frameworks. The first is that of the search for profits and competition. If successful in such investment, by raising productivity (and often by intensifying work) individual capitalists can cut their costs and increase their profits. If this proves true for one capitalist, those who can follow suit to be able to compete. But what, beyond simple greed, motivates investment in new – hopefully more productive – technology? The obvious answer is anything that reduces the existing rate of profit by raising the costs of production or by reducing the rate of surplus value. Leaving aside temporary increases in costs due to external causes, the most obvious candidate for raising costs is worker success at winning higher wages or other benefits, e.g., safety equipment.185 The most obvious candidate for reducing s/v is any reduction in work time with no change in v. In Capital, Marx places his emphasis on the latter.186 This emphasis is clear in the number of words Marx devotes in Capital to the historical success of workers (and their reformist supporters) in obtaining reductions in work time. After sketching capitalist efforts to impose ever longer hours of labor, he describes how workers and their reformist supporters fought back, stemmed that capitalist offensive, and eventually succeeded in getting laws passed reducing the number of hours in a working day. In retrospect, his emphasis seems well placed because after his time workers have gone on to win further reductions in the number of working days in a week, the number of working weeks in a year and the number of working years in a workers’ lifetime. All such reductions undermine absolute surplus value, both as a phenomenon (successful extraction of surplus labor) and as a strategy (increasing work time). Although these successes have never been complete, not then, not now, in the sense of covering all workers in all jobs, the overall effect of each such victory has been a reduction in the ability of capital as a whole to extract surplus value and profits. As a result, more and more capitalists have been forced to change their strategy of exploitation. 185 186 And, eventually, things like health care, paid leave, etc. For this he has been reproached by some Marxists for not devoting as much time and words to wage struggles as to those to reduce work time. Among those lamenting the “absence of a chapter on wage struggles” are Michael Lebovitz and Toni Negri. See: ­Lebowitz, Beyond Capital: Marx’s Political Economy of the Working Class (New York: ­Palgrave MacMillan, 2003) and Negri, Marx Beyond Marx, op. cit. Nevertheless, it is clear enough in Marx’s analysis that not only can increases in wages undermine profits, but that increasing productivity makes it possible for employers to make concessions to workers while maintaining profits. 198 chapter 4 As soon as the gradual upsurge of working-class revolt had compelled Parliament compulsorily to shorten the hours of labor, and to begin by imposing a normal working day on factories properly so called, i.e., from the moment that it was made impossible once and for all to increase the production of surplus value by prolonging the working day, capital threw itself with all its might, and in full awareness of the situation, into the production of relative surplus value, by speeding up the development of the machine system.187 Whether the motivation is to offset wage and benefit concessions or shorter hours, successfully “speeding up the development of the machine system” to raise productivity requires control over workers – getting them to cooperate with the change or repressing their resistance. As the Luddites and many subsequent struggles have demonstrated, this is not always easy because such changes often cause crises for workers, e.g., layoffs, loss of wages and all the stark consequences. So, the first, most immediate possibility of crisis is the reaction of workers who may strike, destroy machines, or even burn down factories. Successfully increasing MP/LP requires successfully managing one’s labor force. Those who are better at it have a shot at winning the competitive battle. As this dynamic has played out, the result has been a secular rise in average MP/LP and co/vo, albeit a rise marked by repeated crises in capital’s ability to manage the class struggle. Beyond such immediate problems, by far the most profound possibility of crisis in response to increases in the technical and organic compositions of capital lies in the unintended “tendential fall in the rate of profit”, which Marx analyzes at length in Part Three of Volume 3. Because he calls this tendency “the most important in the capitalist process of accumulation”, I treat it separately in the next section. 4.4 Possible Crises Due to a Tendency for the Rate of Profit to Fall Marx first worked out how this tendency of capitalists to raise the organic composition could have contradictory effects on profits and predispose to crisis in the Grundrisse, then in the Manuscript of 1864−1865, distilled by Engels into Capital, Volume 3, Part Three. How it can raise profits, he showed in Volume I. How it can lower them is less immediately obvious, but simple and with the most profound consequences. Let me outline it briefly in mathematical terms: 187 Capital, Vol. I, pp. 533−534, or MECW, Vol. 35, pp. 412−413. The Possibilities of Crisis 199 First, Marx expresses the rate of profit in terms of value, s/(c + v), not in terms of money. The ratio is surplus value over value invested in c and v, not monetary profit over money costs. Second, increases of productivity can lower v. Because there is no limit to this reduction, in theory complete robotization (complete elimination of human labor) could reduce v to zero. As v is reduced towards zero, s/v would seem to rise toward infinity and s/(v + c) to s/c. However, there is an upper limit on the possible value of s given by the number of workers, the length of the working day (which cannot even approach 24 hours), and the upper limit on intensity of physical and mental endurance. Therefore, with a rise in s/v brought on by an extension of the working day, rising intensity, and mainly by rising productivity, profits, s/(c + v), will tend, not to infinity, but to s*/c where s* is the upper limit on the possible value of s, and v has gone to zero. Third, the relative surplus value strategy that raises productivity and lowers v is based on a rise in the organic composition of capital, co/vo, which, being based on MP/LP, knows no theoretical limits. Therefore, the c in s*/c can rise continuously or repeatedly, without limit. Since s* is limited, s*/c will tend to fall. (Note: the distinction between the organic and value compositions of capital is critical here. Rising productivity in production of MP could lower the value composition, but not the organic composition that is tied to MP/ LP. Indeed, lowering the value of MP encourages its substitution for LP and thus a rise in the technical and organic compositions.) In short, the outcome of the tendency of the organic composition of capital to rise is an increasing difficulty in extracting surplus value. It takes a larger and larger investment in c to impose/extract a given amount of surplus labor. This tendency, which Marx called the most important in the capitalist process of accumulation, is not simply a mathematical formalism, but a social process inherent in the class relation of developing capitalism. There has been so much confusion about this that I want to bring out aspects of this social process more clearly. In the Manuscript of 1864−1865 and Capital, Volume 3, where the most rigorous exposition of the tendency is given, Marx gives some indication of the dimension of the problem. He insists repeatedly that: The progressive tendency of the general rate of profit to fall is, thus simply the expression, peculiar to the capitalist mode of production, of the progressive development of the social productivity of labor.188 188 Manuscript of 1864−1865, pp. 321−322. Capital, Vol. 3, p. 319; MECW, Vol. 37, p. 211. 200 chapter 4 Writing of the source of this movement, i.e., the tendency for the organic composition of capital to rise: This progressive decline in the variable capital in relation to the constant capital, … is just another expression of the progressive development of the social productivity of labor, which is shown by the way that the growing use of machinery and fixed capital generally enables more raw and ancillary materials to be transformed into products in the same time by the same number of workers, i.e., with less labor.189 Behind the movement of the value relations is the movement of the material relations of production. This is why the organic composition must never be confused with the value composition because it alone reflects the real moment represented by the technical composition. The most detailed and profound discussion of the real processes involved in the tendency of the organic composition to rise is contained in the Grundrisse. There we find two points that are very relevant here. The first, which he makes just about everywhere, is capital’s “general tendency to drive beyond every barrier to production”190; its “tendency to expand them [labor and value creation] boundlessly”191; “the necessary tendency to raise it [the productive force] to the utmost.”192 This emphasis on the endless expansion of capital, its quest for infinitude, is inherent in the class relations. It is neither an a priori assumption nor a crude observation. It is the product of capital’s need to raise productivity and expand production in the face of workers’ struggles. Second, the relative surplus value strategy necessarily becomes central; the ever-greater investment in constant capital, especially labor-replacing machinery, becomes a measure of the development of capital. Symbolically we can see that the technical composition and thus the organic composition of capital, co/vo, become virtual indexes of the degree of development of capital, which is to say of the class relation: … the quantitative extent and the effectiveness (intensity) to which ­capital is developed as fixed capital indicate the general degree to which capital is developed as capital, as power over living labor …193 189 190 191 192 193 Manuscript of 1864−1865, p. 321. Capital, Vol. 3, p. 318; MECW, Vol. 37, p. 210. Grundrisse, p. 415; MECW, Vol. 28, p. 342. Ibid., p. 421; MECW, Vol. 28, p. 350. Ibid., p. 422; MECW, Vol. 28, p. 351. Ibid., p. 699; MECW, Vol. 29, p. 85. The Possibilities of Crisis 201 But if the development of science and machinery measure the development of capital, how does the ever-greater employment of these elements of constant capital lead to crisis? Formally, the crisis, in the form of a tendency for the rate of profit to fall, grew out of the inability to compensate for a rising organic composition, c/v, by a sufficiently rising s/v. But the real meaning of this formalism is simple enough. The only way you can get the s in s/(c + v) to rise with a limited rate of exploitation s/v is to increase the number of workers; and it is for that reason that capital must expand the mass of s to compensate for the fall in s/(c + v). Yet, the result of the tendency of the organic composition of capital to rise is that the number of laborers tends to be reduced as they are replaced by machines. Certainly, workers thrown off in one sector, e.g., manufacturing, may be absorbed in another, e.g., services, but the overall tendency remains active in all sectors. Therefore, even the rise in the mass of s is undermined by this process. What Marx is getting at here is the very observable tendency of capital to create ever larger, more complex production processes, controlled by relatively smaller numbers of ancillary workers: Labor no longer appears so much to be included with the production process; rather, the human being comes to relate more as watchman and regulator to the production process itself … No longer does the worker insert a modified natural thing as middle link between the object and himself; rather he inserts the process of nature, transformed into an industrial process, as a means between himself and inorganic nature, mastering it. He steps to the side of the production process instead of being its chief actor.194 In its efforts to control workers by replacing some with machinery, capital is simultaneously undermining its fundamental control mechanism: work itself. If the tendency is for every production process to be automated in response to inevitable worker resistance to exploitation and alienation, human work is decreasingly needed and becomes decreasingly important in the production of social wealth: But to the degree that large industry develops, the creation of real wealth comes to depend less on labor time and on the amount of labor employed than on the power of the agencies set in motion during labor time, whose ‘powerful effectiveness’ is itself in turn out of all proportion to the direct labor time spent on their production, but depends rather on the general 194 Ibid., p.705; MECW, Vol. 28, p. 91. 202 chapter 4 state of science and on the progress of technology, or the application of this science to production.195 In this discussion in the Grundrisse, in this famous “Fragment on Machines,” Marx is clearly talking about the reduction in manual labor – by far the primary sort of labor toiling for capital in his time. But it is also clear in his analysis of the labor process, in Chapter 7 of Volume 1 of Capital, that “the general state of science” and its application to industry – the usual definition of technology – are also the products of living labor, of mental labor. What distinguishes the worst architect from the best of bees is that the architect builds the cell in his mind before he constructs it in wax. At the end of every labour process, a result emerges which had already been conceived by the worker at the beginning, hence already existed ideally.196 Among those things “conceived by the worker” are scientific theories. But as with every other labor process, they are only the beginning; they must be tested and their consequences discovered. Both scientific and technological research involve a mixture of mental and skilled manual labor.197 The performance of basic scientific research has always involved myriad steps requiring careful manual manipulation of equipment by scientists and their technical assistants. The application of science to industry has also always involved scientists, engineers, and their technicians in a complex array of manual tasks in crafting new machines and production processes as well as the mental labor involved in their conceptualization, evaluation of progress, etc. While this increasing importance of mental labor certainly increases the demand for such labor – offsetting to some degree the decline in the demand for manual labor – it is also subject to the same dynamic as manual labor, namely the tendency of capital, over time, to substitute the use of machines for the mental labor of individuals, thus reproducing in these fields of endeavor the same dynamic of a rising organic composition of capital as experienced elsewhere.198 195 196 197 198 Ibid., pp. 704−705; MECW, Vol. 28, p. 90. Capital, Vol. 1, p. 284. This very material mixture is often overlooked in contemporary discussions of so-called “immaterial labor.” While not yet obvious in Marx’s time, it certainly is in ours, e.g., computers, computercontrolled equipment and artificial intelligence programs (AI). The Possibilities of Crisis 203 But if the production of social wealth is increasingly independent of labor, then capital is undermining its ability to impose work as a condition of social wealth and thus as value: In this transformation, it is neither the direct human labor he himself performs, nor the time during which he works, but rather the appropriation of his own general productive power, his understanding of nature and his mastery over it by virtue of his presence as a social body – it is, in a word, the development of the social individual which appears as the great foundation-stone of production and of wealth. The theft of alien labor time on which the present wealth is based appears as a miserable foundation in face of this new one, created by large-scale industry itself. As soon as labor in the direct form has ceased to be the great wellspring of wealth, labor time ceases and must cease to be its measure and hence exchange value (must cease to be the measure) of use value … With that, production based on exchange value breaks down.199 This is a vivid exposition of the concrete processes expressed by and producing the rise in the organic composition of capital and the tendency for the rate of profit to fall, and also a vision of how this tendency works to undermine the fundamental basis of capitalism, as a system based on the imposition of work through the commodity form. 5 Possibilities of Crisis in the Third Stage of the Circuit: Sales The third moment of the circuit, C′ – M′, like the first, is in the sphere of exchange or circulation. Its completion depends upon the successful production of the commodity C′ being followed by the discovery of those both able and willing to buy it with an equivalent M′. In usual Marxist parlance, this is the realization problem. Only if buyers can be found do capitalists stand a chance of earning at least the average rate of profit, s/(c + v). This is the flip side of two processes whose susceptibility to crisis I have already discussed in 4.1 the purchase of labor power, M – LP, and commodities C(MS) and C(MP). However, although Marx considered slavery an anomaly within capitalism, people are still enslaved, sold and bought, by among others, traffickers of sex workers and domestic servants. Therefore, just as I included possible crises in 199 Ibid., p. 705; MECW, Vol. 29, p. 91. 204 chapter 4 obtaining slaves in Section 3.2.1, I include possible crises in selling labor-power in the form of slaves i.e., C(LP) – M. 5.1 Possible Crises in Selling Slaves, C(LP) – M′ The most obvious sources of crisis for both capitalists trying obtain slaves – as a substitute or complement to waged workers – and those selling slaves have been the revolts of the slaves themselves and interventions by others helping them break free. The successful flight of slaves to maroon colonies or to areas where slavery is outlawed obviously deprives slavers of their “property”/ commodities. So too, does the escape of modern slaves from sweat shops, fishing boats or illegal brothels. Slaves rising up in violent rebellion do the same, temporarily if revolt is put down, permanently when successful, as in the rising on Santa Domingue that overthrew slavery on the island. Beyond the slaves themselves, anti-slavery reformers (including ex-slaves) have joined the fight, ranging from sporadic individual action through the collective organization of flight to the ultimately successful public battle for the criminalization of chattel slavery. As with all laws, however, success in outlawing both chattel slavery and human trafficking has only been effective to the degree that the laws have been enforced. It took the deployment of naval military forces to enforce the criminalization of the transoceanic slave trade and it took a civil war in the United States to enforce Lincoln’s Emancipation Proclamation of 1862.200 5.2 Possible Crises in Selling C(MS)’ or C(MP)’ As capitalism developed, the search for and creation of markets expanded steadily – both domestically and internationally. Capitalists trying to sell both C(MS)’ and C(MP)’ share the problem of properly gauging the amount of their production to the size of the market and thus avoiding either underproduction 200 Still true today. In principle, wherever slavery, of one sort or another, has been outlawed, various police forces, both local and national, are supposed to shut it down. But given their neglect, corrupt complicity, or failure, it has persisted. Therefore, contemporary opponents of slavery have organized to pressure governments into more effectively enforcing existing laws against human trafficking and enacting new laws against other forms of forced labor, e.g., the de facto slavery of children in factories, of adults in prisons, and of forced marriages. See, the work of the Anti-Slavery International, Freedom United, the Anti-Slavery Society, and the list at https://www.endslaverynow.org/connect (accessed 2024). Current conservative efforts to weaken or revoke laws prohibiting child labor have been making it harder for these efforts to succeed. See, Jennifer Sherer and Nina Mast, “Child labor laws are under attack in states across the country,” Economic Policy Institute, March 14, 2023. The Possibilities of Crisis 205 (depleted inventories, lost sales as customers to turn to competitors) or overproduction (glutted markets, expensive inventory buildup or selling at prices below value). 5.2.1 Possible Crises of Overproduction/Underconsumption For capitalists to be able to sell the goods and services produced by their workers, they require customers with both money and readiness to spend it on what they need or desire. Any limit to the availability of money, or to a willingness to spend it, limits demand and the ability of capitalists to sell and make profits. “New value and as value as such,” Marx writes, must have the proper “magnitude of available equivalents, primarily money … the surplus value … requires a surplus equivalent.”201 In order to realize surplus value in the accumulation process there must be expansion at several points. “The surplus value created at one point requires other points: creation of surplus value at another point, for which it may be exchanged; if only, initially the production of more gold and silver, more money …”202 Will all those other points be realized – that is, come into existence? Although there are some reasons to think they will, there is also the possibility that there will not be enough of them and aggregate demand will be less than aggregate supply. Discussing absolute surplus value, Marx indicated how the realization of surplus value requires an expansion of the market – the “sphere of circulation” – and, to some degree, the expansion of production produces that: The creation by capital of absolute surplus value – more objectified labor – is conditional upon an expansion, specifically a constant expansion of the sphere of circulation … A precondition of production based on capital is therefore the production of a constantly widening sphere of­ circulation, whether the sphere itself is directly expanded or whether more points within it are created as points of production … to create more points of exchange; i.e., here seen from the stand point of absolute surplus value or surplus labor, to summon up more surplus labor … The tendency to create the world market is directly given in the concept of capital itself … to subjugate every movement of production itself to exchange.203 201 202 203 Grundrisse, p. 405, or MECW, Vol. 28, p. 332. Grundrisse, p. 407, or MECW, Vol. 28, p. 334. Grundrisse, p. 407−408, or MECW, Vol. 28, pp. 334−335. 206 chapter 4 The expansion of capital, which begins with investment M – C(LP, MP), immediately creates new points of exchange for final products, namely workers who can exchange their wages, M, for C(MS)’, and other capitalists who can invest the M′ obtained from selling C(MP) to the investor. The growing number of wage workers are themselves “independent centers of circulation.”204 He made the same kind of observation concerning the need for an expansion in the case of relative surplus value. “The production of relative surplus value … requires the production of new consumption; requires that the consuming ­circle within circulation expands as did the productive circle previously.”205 However, just because the expansion of capital based on absolute and relative surplus value strategies results in the multiplication of points of exchange, and in an expansion of the money available to buy the output, it remains possible that the amount buyers want to buy will be less than the commodities to be sold. This possibility, Marx and Engels recognized because they saw it repeatedly. Therefore, in the absence of a plan to coordinate the amount produced with the amount demanded, the possibilities of differences in the two amounts were inherent in the system. Capitalists can control the amount their own workers produce (based on their expectations) but they cannot control either the amount produced by their competitors or the demand for their product. For the most part, both are in the hands of others. How they cope with these problems, I discuss in Chapter 6. In the world around them, Marx and Engels saw how production sometimes continues even though previously produced commodities have not yet been sold, either by the producing firm or by wholesalers who bought them to sell or by retailers who bought them from wholesalers. The production of surplus value … and the whole reproduction process finds itself in the most flourishing condition, while in fact a great part of the commodities have only apparently gone into consumption, and are actually lying unsold in the hands of retail traders, thus being still on the market. One stream of commodities now follows another, and it finally emerges that the earlier stream had only seemed to be swallowed up by consumption. Commodity capitals now vie with each other for space on the market. The late-comers sell below the price in order to sell at all. The earlier streams have not yet been converted into ready money, while payment for them is falling due … At this point the crisis breaks out.206 204 205 206 Grundrisse, p. 419, or MECW, Vol. 28, p. 345. Grundrisse, p. 408, or MECW, Vol. 28, p. 335. Capital, Vol. 2, p. 156, or MECW, Vol. 36, pp. 82−83. The Possibilities of Crisis 207 In reading this passage, we must remember that “consumpti0n” includes sale and subsequent using up of raw materials and fixed capital as well as that of final consumer goods. Although Marx and Engels mostly associate the term consumption with workers’ consumption of MS, of food, clothing, housing, etc., they also recognized how this is what capitalists do with the MP they purchase.207 They effectively “consume” MP in production.208 So Marx approves this application of the term by Heinrich von Storch in critiquing Jean-Baptiste Say: Storch, for example, remarked quite correctly against Say that a great part of consumption is not consumption for immediate use, but consumption in the production process, e.g., consumption of machines, coal, oil. required building etc.209 Marx’s comments on the production of, and demand for, the means of production are similar to his treatment of consumer goods: It is quite the same [to be points of centers of circulation] with the demand created by production itself for raw material, semi-finished goods, machinery, means of communication, and for auxiliary materials … In so far as one capitalist buys from others, buys commodities, or sells, they are within the simple exchange relation; they do not relate to one another as capital. The correct (imaginary) proportion in which they 207 208 209 The other common meaning of consumption in the nineteenth century was “the lung d­ isease” or tuberculosis, so-called because the disease appeared to consume or waste away the body. Completely in the case of raw materials, partially in the case of fixed capital such as machines or factories. Grundrisse, pp. 412−413; MECW, Vol. 28, p. 339. This recognition by Marx (and Storch) made it impossible for him to fall into the trap of those who saw in the “underconsumption” of MS the source of crisis in capitalist reproduction. This has included both Marxists and non-Marxists, such as John Hobson, who have based their theory of crisis on the idea that workers could not buy back all that they produced, but failed to recognize how inadequate aggregate demand could also be due to a lack of markets for MP due to a lack of capitalist investment. See Hobson’s The Physiology of Industry (1889), written with Albert Mummery, and his Imperialism: A Study (1906). The latter would influence the two Bolsheviks, Nicolai Bukharin and Vladimir Lenin whose books Imperialism and the World Economy and Imperialism: The Highest Stage of Capitalism, both published in 1917, have been foundational for many subsequent Marxists. 208 chapter 4 must exchange with one another in order to realize themselves at the end as capital lies outside their relation to one another.210 This means, as with the production of consumption goods, that capitalists cannot, as individual buyers and sellers, see the overall picture, cannot know in advance exactly how much buyers will want or be able to buy. Therefore, the proportions can be wrong. As I pointed out in Chapter 2, Marx first encountered capitalists beset with these problems in the 1840s while studying the problems of the Moselle vintners (1843) who were producing wine (a consumer good) and Silesian weavers (1844) who were producing cloth (a means of production for the clothing industry). Both found themselves overproducing because of the influx of (cheaper) goods from elsewhere in Germany because of the Zollverein. Eventually, in 1848, after much study, Marx took on the issue of trade policy and the debates over it directly in a “Speech on the Question of Free Trade.”211 He laid out and examined both the arguments for “free trade” and those for “protection,” coming down on the side of “free trade” – but only because he believed it increased the frequency of crisis and “hastens the Social Revolution.”212 In Volume 1 of Capital, the theoretical possibility of overproduction is first analyzed by Marx in the case of individual producers, e.g., farmers or crafts persons, selling some use-values to obtain the money they require to obtain other use-values, i.e., C – M – C, often for their personal consumption. In Chapter 3 “Money, or the Circulation of Commodities,” he points out one source of overproduction, namely that even in a world with many buyers “no one directly needs to purchase because he has just sold.”213 Just because the sellers of C find buyers willing to part with their M, those sellers can then hold onto the money they receive instead of spending it. They may, for example, save to accumulate enough money for future, larger purchases. The possibility of C – M with no follow up M – C implies, he argues “the possibility of crises, though no more than the possibility.”214 All this is framed in terms of the selling and purchasing behavior of individuals in particular markets. Marx and Engels’ primary interest, however, in both their journalism and their theoretical work, were the possibilities of widespread failure in which 210 211 212 213 214 Grundrisse, p. 421, fn *; MECW, Vol. 28, p. 349. MECW, Vol. 6, pp. 450−465. Ibid., p. 465. Compare with Engels’ treatment of this same issue in his second “Speech at Elberfeld,” February 15, 1845, MECW, Vol. 4, pp. 256−264. Capital, Vol. 1, pp. 208−209, or MECW, Vol. 35, p. 123. Capital, Vol. 1, p. 209, or MECW, Vol. 35, p. 124. The Possibilities of Crisis 209 many capitalist producers faced many glutted or saturated markets, found they had overproduced and suffered a general commercial crisis. For them too, the possibility of failure to sell also lies in the separation of sale, C(MS)’ or C(MP)’ – M′ (supply) from consumer demand M – C(MS) and from investment demand, M – C(MP). Marx argued that because production was carried on by independent capitalists making their own decisions about investment and production (reaching separate deals with workers and suppliers, negotiating separate sales agreements with intermediaries, consumers, or other capitalists), there is no overall plan to coordinate supply and demand.215 Thus, the proportionate division of capital investment in c and in v required for reproduction might well be incompatible with the actual amounts of MP and MS produced. From this perspective the possible inability to realize the sale, C′ – M′, of either MS or MP, is part of the larger problem implicit in Marx’s scheme of expanded reproduction analyzed in Volume 2 of Capital, namely the requirement that smooth accumulation requires: Dept I MP* = MP1 + MP2 + new MP1 + new MP2 Dept II MS* = LP1 + LP2 + new LP1 + new LP2 In the absence of planning, imperfect market mechanisms, i.e., producer/ seller and buyer behavior based on often flawed perceptions, erratic expectations and unexpected disruptions, provides only crisis-ridden paths to achieving these required proportions.216 Among the possible causes of “flawed perceptions” are the often-serious lags in information flows sketched in Section 3.3.4. There I was concerned with the problem posed by time lags in information about the availability of means of production to buyers, those who need them in order to begin, continue, or expand production. But the same problem confronts sellers of both MP and MS. Each capitalist wonders whether there will be enough buyers to purchase everything their firm is sending to this or that market. If not, they will have “overproduced” C(MP)’ and C(MS)’ and suffer the consequence of “underconsumption” in the case of C(MS)’. 215 216 The exception, recognized by political economists as well as by Marx and Engels, were small, local markets where capitalists producing the same commodities could form an oligopoly, set common prices, and divide up the market. The inevitable problems in meeting these requirements provided Rosa Luxemburg the foundation for theories of both crisis and imperialism. See, her “The Accumulation of Capital,” now included in The Complete Works of Rosa Luxemburg, Vol. II: Economic ­Writings 2 (New York: Verso, 2015). 210 chapter 4 Such questions of proportionality are not simply technical or planning problems. As mentioned in Chapter 3, there is a class struggle over the proportionate allocation of resources to the two departments, and the struggles within other parts of the circuit can impinge on both the production of MP and MS, and on the allocation of v and c, in ways that undermine proper proportionality. The opposite case – when producers crank out less than buyers want, signaled by an unexpected drawdown of inventories – Marx and Engels seem to have seen as simply an inducement to firms to increase production, sales, and total profits but not as any kind of crisis. Nevertheless, despite these common problems, there are distinct differences in the problems facing those trying to sell means of subsistence and those trying to sell means of production. 5.2.2 Possible Crises in Selling the Means of Subsistence, C(MS)’ – M’ For capitalists to sell consumer goods, workers must be both willing and able to buy.217 Anything which substantially undermines either of those two conditions reduces demand and can cause a crisis for sellers of C(MS)’. Historically, capitalists have done their best to force people to buy consumer commodities by stealing and then monopolizing the means by which they might produce for themselves. The result: the only legal way to obtain the means of consumption has been by selling one’s labor-power in exchange for the money required to buy what is needed.218 As Marx points out in Capital, Vol. 1, Chapter 30, capitalist success in imposing these conditions created the “home market” for C(MS)’. The same methods were deployed in colonies abroad to create “foreign markets.” Although mistakenly thought by some to be a thing of the past, such theft has been ongoing, along with all the struggle it has provoked. 217 218 For a long time and for obvious historical reasons, MS was considered to take two ­distinct forms, literal means of subsistence consumed by workers and luxury goods consumed by capitalists. The development of a continuous income hierarchy encompassing everyone who works for capital, from the unwaged in the reserve army through blue and white collar waged and salaried workers up to highly paid managers – those Marx called the “functionaries” of capital – has made that simple dichotomy obsolete. I assume, as Marx did most of the time, that the vast bulk of the consumption of MS is by workers and ignore the tiny pool of those whose only contribution to the expanded reproduction of capital is buying commodities out of surplus value, i.e., the leisured rich who, like the landed aristocracy who preceded them, live entirely off unearned income derived from financial assets and rent. Capital, Vol. 1, Chapters 27 and 28 analyze the expropriation of land and tools and the violence with which capitalists have forced people into the labor market in search of the money they need to purchase C(MS). The Possibilities of Crisis 211 Not surprisingly, many of those who have been expropriated have struggled to reclaim their stolen means of production, e.g., peasants and small farmers left landless have fought to regain their access to land and tools. To the degree such efforts succeed, they undermine the “home market” for consumer goods. 5.2.2.1 Possible Crises due to Reversing Enclosure Both enclosures and efforts to reverse them predated capitalism but were renewed by the emerging capitalist class grabbing land and destroying homes and handicraft tools during that “primitive accumulation” of capital which Marx analyzed in Part Eight of Volume 1 of Capital. Clearly, every peasant ­success at seizing and then cultivating land, has made it possible for them to withdraw, to some degree, from capitalist markets for MS. In his book on The Peasant War in Germany (1850), Engels looked back at the history of such struggles, focusing on peasant revolts in the 1500s. German peasants and their supporters demanded, among other things, the abolition of serfdom and guaranteed rights to land. They tried negotiations, appeals to courts and finally armed struggle. His analysis repeatedly compares and contrasts the struggles of German peasants with others in Britain and elsewhere.219 One well-known effort by the landless to seize land took place during the English Revolution of the mid-1600s. One part of the many diverse efforts by the dispossessed in that period to “turn the world upside down” was occupying, cultivating and building houses on previously stolen commons, often uncultivated “wasteland.”220 Such were the struggles of the “True Levellers,” or “Diggers”, one of whose leaders was Gerard Winstanley (1609−76) – who wrote both a manifesto explaining their demands and objectives and a song for them.221 Struggles for land continued in the 1700s and 1800s, taking place piece-meal, locally or through immigration, or as one motivation of those involved in various revolutions, e.g., the American (1775−1783), French (1789−1799), Haitian (1791−1804), French and the Dutch in 1830, the Revolutions of 1848 and the Paris Commune of 1870. To such momentary upheavals we must add the long history of resistance to colonial dispossession that involved both settler efforts 219 220 221 MECW, Vol. 10, pp. 397−482. Marx and Engels also followed such struggles in other countries, e.g., Russia and Poland. See, “Note to Polish Readers” in this volume. See, Christopher Hill, The World Turned Upside Down: Radical Ideas During the English Revolution (London: Penguin, 1984) 107−124, and listen to Leon Rosselson’s songs resurrecting and celebrating their struggles. See, Winstanley, The New Law of Righteousness (1649). Hill’s book recounts many events of the momentous year of 1649 when the Diggers seized land, Cromwell invaded Ireland and the king was beheaded. 212 chapter 4 to expand enclosure and those by the indigenous to stop or reverse it, throughout the Western Hemisphere, Asia, Africa and Oceania.222 5.2.2.2 Possible Crises due to the Direct Appropriation of MS Inevitably, because capitalists maintain a “reserve army” of unwaged workers to pit against the employed, many of those dispossessed from the land, and unable to regain access, do not find jobs, cannot earn a wage and therefore are unable to buy, regardless of their willingness or need to do so. They either depend on those who can find jobs and wages to support them, e.g., waged spouses or other extended family members, or they find some other way to obtain what they need, or they die. In this predicament, they find themselves in the same plight as other workers who participated in the labor market but subsequently lost their jobs and been dumped into the reserve army. In both cases, one obvious alternative to dying has been to bypass markets for MS and directly appropriate what is needed. The direct appropriation of C(MS) by workers, before they can be sold, has disrupted capitalist management of markets throughout its history. I have already pointed to such appropriation in the sphere of production – including in the transportation of C(MS) to markets. The direct appropriation of finished goods for purposes of consumption is very much like that of raw materials or intermediary goods in production discussed previously. In both cases, workers reject capitalist claims to the ownership of products they themselves, or other workers, have produced, ignore sellers’ prices and, when successful, reduce C(MS)’ to MS, destroying their exchange value to capitalists.223 222 223 Such struggles were renewed in the twentieth century. They included not merely smallscale land occupations but widespread revolutionary risings by peasants, including their central roles in the Mexican, Russian, and Chinese revolutions. In all these three great revolutions peasants and landless laborers seized land. See, Eric Wolf, Peasant Wars of the Twentieth Century (New York: Harper & Row, 1969). To a considerable degree this was also the motivation of peasants supporting anti-colonial, “national liberation” movements, such as the Vietnamese revolt that retook land stolen by French colonialists (who had converted the land from subsistence to production for export, e.g., rice and rubber). Then, in the wake of independence from colonialism, the failure of new elites in country after country to redistribute land led to widespread seizures and aggressive legal demands for land reform. Such efforts have continued by, among others, the Zapatistas in Mexico, the Movimento dos Trabalhadores Sem Terra (MST, or Landless Workers’ Movement) in Brazil and other wings of Via Campesina. But not necessarily their use-value. Not only does consumption of directly appropriated MS sustain the unwaged as part of capital’s necessary reserve army, but because so many MS are designed for social control, e.g., to divert energy from struggle by entertaining buyers, such use-values to capital persist. The Possibilities of Crisis 213 To all the appropriations along the supply chain from producer through transport to wholesalers and retail outlets, here I am adding the widespread direct appropriation of final consumer products from those outlets. With ­robbery usually defined as the taking of another’s property, shoplifting and burglary are merely covert forms of robbery. Both forms of appropriation bypass price and refuse payment as the appropriator walks away with the unsold product. Here, we must distinguish robbery-for-resale from robbery-for-consumption. Those who rob a business then re-sell their stolen goods, e.g., individuals, criminal gangs, pirates or privateers, also cause losses to their original owners – be they industrial or merchant capitalists – but the value of the goods is merely redistributed from the original owners to their thieves, rather than destroyed. The thieves effectively assume the role of rogue merchant capitalists, inserting themselves illegally into the circuit. In selling the stolen C’, they re-establish C’ – M’, although the M’ they gain is often less than the original value of the goods stolen and resold.224 NB: I am concerned here only with the direct appropriation of commodities from businesses, which would otherwise sell them. I am not concerned with the robbery of individuals’ property. Such theft either transfers property from one person to another, or, if the stolen property is sold, re-establishes C’ – M’, albeit only to the benefit of the thief and buyer. Methods of direct appropriation vary, from covert acts such as individual shoplifting and burglary to overt ones such as armed robbery in stores, the hijacking of trucks or ships or massive protests. The costs of small-scale robbery to capitalists may be marginal and factored into their “costs of production.” Large-scale, direct appropriations, on the contrary, carried out by those with either little or no money or facing prices which have been raised beyond their ability to pay, can and have caused crises – both for those trying to sell, through the immediate rupture of C(MS)’ – M and through the longer-term delegitimization of prices and capitalist control over them.225 The most frequent of such uprisings, and the best documented, have been those in which 224 225 Whether selling to a “fence” or selling on the black market, they re-insert their purloined goods into the sphere of circulation and like legal merchant capitalists take a cut of the value. The imposition of price-fixing and rationing in periods of crisis, e.g., wartime, also removed some C(MS) from circuits of profit making or reduced their value and hence profits. On the other hand, the spread of food stamps and other forms of income in the wake of uprisings have subsidized both workers’ income and sales of C(MS). Dissatisfaction and protests against capitalist price gauging have been among the forces leading to the removal of unhindered capitalist control over the production and distribution of a few C(MS), e.g., electrical power and water, and their transfer to public utilities, regulated 214 chapter 4 people have seized food, the most basic of necessities.226 Starvation is a powerful goad to action. Remember Engels’s forecast in 1842, about workers faced with “a general lack of food”, “then fear of death from starvation will be stronger than fear of the law.” Given how capitalists have continued to wield poverty against workers, recurrent worker revolt must be expected.227 5.2.3 Possible Crises in Selling the Means of Production, C(MP)’ – M’ Here we have the flip side of M – MP discussed in 1. There I discussed potential crises for those trying to buy MP, here I am concerned with potential crises for those trying to sell MP. However, many of the possible crises that I noted facing buyers of MP simultaneously face sellers, e.g., any reduction in the quantity produced. For buyers of MP that means a likely increase in price, higher costs of production, and less profit. For sellers that means less to sell and the ­danger of any increase in price being offset by reduced sales, revenue and profit – depending on the behavior of buyers.228 5.2.3.1 Possible Crises with Barter In the example of the fur trade in Chapter 4, Section 3.3.1, the emphasis was on ­crises for buyers focused on reductions in supply, either short-term (local conflict) or long-term (exhaustion of species). For sellers, assuming constant demand, any substantial reduction in the supply of furs means less to sell. The long-term depletion of species whose fur can be sold, however, means the eventual reduction in the quantity available to sell, less revenue and profit, even with higher prices. It also meant a reduction in the number of trappers as trapping was largely replaced by industrialized fur farming – the breeding and murder 226 227 228 by the government. Since the rise of neoliberalism in the early 1980s, the push for the privatization has been aimed at restoring capitalist control. For examples from the nineteenth century see, John Bohstedt, The Politics of Provisions: Food Riots, Moral Economy, and Market Transition in England, c. 1550−1850 (London: ­Routledge, 2010). For our times see, David Seddon, Riot and Rebellion: Political Responses to Economic Crisis in North Africa (Tunisa, Morocco and Sudan) Discussion Paper No. 196, School of Development Studies, University of East Anglia, October 1986. Although, to all appearances, most urban uprisings involving direct appropriation have been more or less spontaneous actions, some have taken the form of organized protests involving the “self-reduction” of prices. See, Bruno Ramirez, “The Working Class Struggle Against the Crisis: Self-Reduction of Prices in Italy”, Zerowork 1 (December 1975): 142−150. In neoclassical microeconomic theory, different reactions are approximated by the “­elasticity of demand.” With “inelastic demand”, variations in price will have little impact on sales and profits, but with more elasticity, reduced sales will offset higher prices leaving the seller worse off. The Possibilities of Crisis 215 of animals such as mink or foxes on a mass scale.229 Such industrialization, requiring less labor and more investment in plant and equipment also meant a drastic reduction of the role of barter in the trade. Serious drops in demand, however, could end the trade much sooner, as in the case of the demand for beaver fur to be processed into felt to make hats. The reduction in the demand for hats made of such fur meant a drop in the market for beaver pelts. So even if there were still plenty of beavers to be trapped, with less demand, beaver trapping became a less viable way to make a living.230 Other examples of dramatic drops in the demand for sellers’ goods have originated in the reduction of protection for their markets, reductions which cause producers and sellers to find themselves unable to compete with competitors who can produce more cheaply and sell at lower prices. The abandonment of protectionist measures have sometimes been forced, e.g., by colonialism or war, and have sometimes been the result of economic pressures or negotiation.231 5.2.3.2 Possible Crises due to Workers’ Struggles Clearly, all struggles by workers which reduce the amount of MP produced and transported undermine sales and profits for those selling MP. This includes struggles during initial production and during transportation and sales. (See, Section 4.2.1) So, the same struggles against work, sabotage, strikes, protests, and upheavals that result in shortages and higher prices for buyers of MP, also undermine production, increase costs and prices, reduce sales, and potentially undermine profits for producers and sellers of MP. 5.2.3.3 Possible Crises due to Deterioration of Quality Among the problems facing sellers of both MS and MP are those of convincing potential buyers of their useful qualities. Because both MS and many MP are sometimes produced far from where workers or capitalists will either consume 229 230 231 According to the Fur Institute of Canada, 65−75 percent of the furs produced in that country come from fur farms (and 85 per cent worldwide). In our contemporary world, too many people trap (torture) and kill animals such as ­beavers just for the fun of it! That vicious past-time is currently fought by those trying to protect trapped species from all trapping because of its cruelty. See, for example, NH Citizens Against Recreational Trapping. Widespread examples of such crises for producers and sellers happened in the wake of the collapse of the USSR and the regimes of its client states in Eastern Europe and the subsequent imposition of austerity. In Poland I visited the factory of a major producer of ship engines that had to almost completely shut down because it could no longer sell its wares. Similar problems beset businesses in countries where IMF debt-rollover packages of “structural adjustment” required the reduction or elimination of protectionist measures during the international debt crisis of the 1980s-1990s. 216 chapter 4 or process them, buyers’ evaluation of quality often takes place at points of sale, e.g., ports of arrival, rather than where they were produced. For example, cotton produced in the Americas or in India for the textile factories of Britain was shipped across oceans and then evaluated and sold at their ports of discharge – to either intermediating merchants or textile producers. The same was true with all the cotton cloth or clothes produced in Britain with that imported cotton and then shipped to foreign ports as exports of MS. While some means of production were unlikely to suffer any deterioration during either transportation or storage, e.g., coal or metal ores, many other means of production faced the very real possibility of serious deterioration in their quality between their production as C(MP)’ and their utilization as MP. How serious depends on their intrinsic properties, perishability, and modes of transportation and storage. Marx discusses this while discussing turnover time in Volume 2 of Capital: The more perishable a commodity, the more directly after its production it must be consumed and therefore sold, the smaller the distance it can move from its place of production, the narrower therefore its sphere of spatial circulation, the more local the character of its market.232 Good examples of such limits were means of production subject to water damage during transportation in wooden ships, such as colonial exports like tobacco and rice. In the TV film series Hornblower (1998−2003) based on C. S. Forester’s novels about the fictional career of Horatio Hornblower during the Napoleonic Wars, the episode “An Even Chance” includes a vivid illustration of the dangers of both war and deterioration. A ship smuggling bags of rice through the English blockade of French ports is attacked and taken by an English ship of war. In the taking, the smuggler’s ship is holed below the water line. Before the hole can be plugged, water leaks in, the rice begins to swell and widens cracks in the ship’s frame, which lets in more water. Unable to unload the rice fast enough, the swelling eventually breaks the ship apart and both cargo and ship are lost. Given how all wooden sailing ships were so vulnerable to sea water leaking in through their caulked joints, the war damage portrayed in this TV episode merely accelerated an ongoing danger to vulnerable cargos. Much less dramatic but having a greater impact on the international trade in rice was the tendency of soft-grained rice, e.g., from Siam (Thailand) or 232 Capital, Vol. 2, p. 206, MECW, Vol. 36, p. 132. The Possibilities of Crisis 217 Burma (Myanmar), to deteriorate so quickly that it could only be shipped short distances without considerable loss.233 The same could be true for other consumer goods subject to deterioration, such as tobacco or cotton, where sales prices are partly determined by their innate qualities and partly by their condition, a function of both their production and whatever deterioration they suffer during their long transportation from country of origin to country of utilization. 5.2.3.4 Possible Crises due to the Direct Appropriation of C(MP)’ Just as problems of direct appropriation face buyers of MP, as sketched in Section 3.4, so too do they also face sellers, albeit somewhat differently. Clearly, every direct appropriation by workers or theft of produced MP by capitalists reduces sales, revenue and profits for sellers. If the losses are marginal and foreseeable, sellers often try to compensate by passing the cost of lost MP on to buyers by raising their price, but possibly lowering sales. The net impact on profits of higher prices and lower sales will depend on the behavior of buyers.234 If the losses are unforeseeable and massive – as with a sudden invasion by groups engaged in “self-reduction” (of prices) struggles, e.g., “food riots”, or by bad weather, mutineers or pirates sinking or seizing ships at sea, the costs will be much greater, and the likelihood of crisis increased. 5.3 Credit, Debt, and Commercial Crisis Temporal and geographic distances between the production of C’ and its realization as M’ has long made the availability of credit a major issue for capitalists engaged in commerce. This is true whether the possessor of C’ is an industrial capitalist who has overseen production and now undertakes to sell, or a commercial intermediary who has bought C’ to resell it. Indeed, historically, the extension of credit and the debt to which it gives rise were developed long before capitalism as a social system and played a major role in commerce.235 233 234 235 See, H. J. S. Cotton, “The Rice Trade of the World,” Calcutta Review, Vol. 58, Issue 116 April 1874, pp. 288−9. Given variations in the elasticity of demand, mentioned above, sellers must judge whether and to what degree to pass along increases in costs to buyers, sellers guestimate customers’ likely responses. Credit and debt, of course, also existed in relationships between individuals or between individuals and banks or between governments and banks. Individuals have borrowed from others to meet temporary unusual costs, say a marriage or a medical bill. The wealthy, with collateral in the form of property or dependable income from land rents or 218 chapter 4 From ancient times, banks (and others with surplus funds, e.g., governments and temples) played a vital role in financing long distance trade. That role expanded dramatically with the rapid development of international trade during the Renaissance.236 All those engaged in long distance trade, and facing the kinds of perils already mentioned, often had recourse to credit to finance their operations with the expectation of gaining enough money through trade to cover their debts.237 While obtaining credit in the form of loans solves the immediate need for cash to finance the transportation, storage and selling of C’, holding such 236 237 financial assets, have long been able to borrow from moneylenders and banks. ­Probably the best-known example in literature of a person borrowing from a moneylender is ­Bassanio borrowing from Shylock in Shakespeare’s Merchant of Venice (1596−99). In the post-colonial era of the mid-twentieth century, a major concern of “development” economists was the concentration of surplus money in the hands of moneylenders rather than banks. The “modernization” of finance – and of the economy more generally – required such surplus be channeled through banks, whether private or governmental. The argument was that moneylenders (like Shylock) tended to make loans for “unproductive” activities (such as Bassanio’s courtship of Portia), whereas banks were more likely to make loans to capitalists who would employ their borrowings “productively.” See, for example, Frank Moore, “A Note on Rural Debt and Control of Ceremonial Expenditure in India,” Economic Development and Cultural Change, Vol. 2, 1954, pp. 408−415. For many years, the literature of economic development included critical evaluations of inadequate financial institutions in the Global South and policy proposals for improving them, especially for the creation of new credit instruments for financing both manufacturing and agricultural investment. Focusing on accessing land rent and giving credit to Adam Smith, Walt Rostow (1916−2003) expressed this idea as clearly as other essays focused on finance per se, “surplus income . . . must, somehow, be transferred out of the hands of those who would sterilize it in prodigal living into the hands of the productive men who will invest it in the modern sector and then regularly plow back their profits as output and productivity rise.” Stages of Economic Growth: A Non-Communist Manifesto (Cambridge: Cambridge University Press, 1960) 24. See also: Hugh Patrick, “Financial Development and Economic Growth in Underdeveloped Countries,” Economic Development and ­Cultural Change 14, no. 2 (January 1966): 174−189. Governments have also used bank loans to finance various expenditures, from palaces to wars. Their ability to impose taxes and create money mostly guaranteed their ability to repay. The “sovereign” character of their debt increased the appeal of lending to them by banks. In Capital, Vol. 1, Chapter 31 on the rise of industrial capitalism, Marx presents this use of the state by banks as an important vehicle for the primitive accumulation of investable funds. Books on the history of credit and debt are numberless, but a recent one of interest providing an historical and anthropological perspective is David Graeber’s Debt: The First 5,000 Years (New York: Melville House, 2014). Wikipedia has a nice intro to “The History of Banking” but also see Graeber’s book on debt. As one form of money, “means of payment” is analyzed in Capital, Vol. 1, Chapter 3, but most of Marx’s analysis of credit and its role in capitalism can be found in the Manuscript of 1864−65, in Capital, Vol. 3 and in his journalism and notebooks. The Possibilities of Crisis 219 debt also creates a new possibility of crisis, namely potential difficulties in repayment, in coming up with “means of payment.” Marx’s exposition of this ­difficulty begins in Capital with a discussion of the separation (in non-barter markets) of the acts of purchase and sale. His analysis, abstracted from the history of commerce, is organized around commodity exchange C – M – C, where the two acts of sale, C – M, and purchase, M – C, are separate. In the case of merchant capital, the two are reversed in the sequence M – C – M’, goods are first purchased, M – C, then later, if all goes well, sold, C – M’, at a higher price. Within the context of capitalism, Marx assumes that if the industrial capitalist sells to a merchant capitalist, the latter buys C’ at less than its value, such that when those goods are sold at their value, C’ – M’, the merchant capitalist shares in the surplus value generated by the workers who produced C’.238 In the 1840s, as Engels and Marx began to study these relationships, both old financial institutions such as banks and newer “financial intermediaries,” such as stock and bond markets, were progressively channeling money to capitalist industry. Where Italian banking had dominated commercial trade in the Renaissance, British banking grew to dominance with industrial development in the eighteenth and nineteenth centuries. Other countries, including major ones on the continent, lagged behind Britain in the degree to which banks were making their monies available to capitalists and not just to governments and the simply wealthy.239 So, for example, in a series of articles in 1846 and 1847, Engels describes the various means – some illegal – by which Frederick William IV of Prussia was borrowing money, at home and abroad, eventually trying to trick the United Diet into approving a new loan – despite the backdrop of crisis in which “there is comparatively little capital in Prussia,” i.e., little money available for industrial investment and what was available was being 238 239 Although ignored at this point in his exposition, I have already indicated how Marx points out in Vol. 2 of Capital, how transportation – almost always an integral part of commercial operations – is another source of surplus value, extracted from the transport workers employed by merchant capitalists. See, Capital, Vol. 2, pp. 134−135, or MECW, Vol. 36, pp. 61−62. By “simply wealthy” I refer mainly to “old money,” individuals and families rich from inherited wealth and pre-capitalist sources of income, such as land rents and purely merchant buying and selling. As primitive accumulation progressed and landowners either became capitalists or hired others to manage their estates as agribusiness enterprises, such differentiation faded and as commerce became an integral part of capitalist operations meaningful distinctions between “old” and “new” money blurred and came to refer more to the chronological order of the acquisition of wealth than to that between pre-capitalist and capitalist sources. 220 chapter 4 diverted away from industry into speculation – one of the uses of credit most prone to crisis.240 Everywhere capitalism has developed, sooner or later, in response to difficulties and possible crises, new credit relationships have been developed among industrialists, merchants and specialized financial institutions such as banks at every point of the reproduction of capital where exchange occurs.241 By the mid-1850s, Marx’s studies of finance included following efforts in France – one of those countries where capitalist finance lagged – to reorient banking toward industry. He tracked the doings of the Société Générale du Crédit Mobilier, a joint stock company backed by Napoleon III that raised money by issuing stock to the wealthy and the emerging middle class.242 While loaning money to the government – to finance, among other things the Crimean War – and to merchant capitalists engaged in commerce, the Crédit Mobilier’s claim to fame was its financing of large-scale industry, such as railroads, both in France and abroad. Marx reported that the actual business practices of the company involved as much speculation with other people’s money as they did investment in industry.243 Commercial credit can be extended either to the producing capitalist or to a commercial intermediary. A producer may borrow to cover the costs of 240 241 242 243 Friedrich Engels, “Violation of the Prussian Constitution,” “The Prussian Bank Question” and “The Prussian Constitution” MECW, Vol. 6, pp. 52−53, 57 and 64−71, respectively. See his and Marx’s analyses of speculation and its roles in the crises of the 1840s in Chapter 2.1. above. Among the many new credit instruments created were government ones both for local financing and for international loans, supposedly guaranteed sovereign debt but revealed during the international financial crisis of the 1980s and 1990s to be far more vulnerable to collapse than anticipated. In this neoliberal period of the deregulation of finance, there has been a veritable explosion in the varieties of credit instruments, a great many of which provide platforms for speculation. The speculative housing booms of 1980s brought on the collapse of 1987 and that of the early 2000s brought on that of 2006, generating a general economic crisis in 2007−2008. Whereas institutions of crédit foncier, e.g., land banks, base loans on the security of landed, immovable property, those of crédit moblier base loans on movable property, i.e., financial assets such as shares in both public and private companies available to both wealthy and middle classes with enough money to save and invest. On the development of capitalist finance in France that takes Marx’s analysis into account, see Joseph Ricciardi, “Essays on the Role of Money and Finance in Economic Development” (PhD Diss., University of Texas at Austin, 1985). Some of his analysis has been made more readily available in Joseph Ricciardi, “Marx on Financial Intermediation: Lessons from the French Crédit Mobilier in the New York Daily Tribune,” Science and Society 79, no. 4 (October 2015): 497−526. See, the three articles “The French Crédit Mobilier,” in MECW, Vol. 15, pp. 8−13, 14−18, and 19−24. The Possibilities of Crisis 221 the sales effort, e.g., transporting goods and finding buyers, with repayment dependent on successful sale. Or, an intermediary (a wholesaler or retailer) may borrow to buy C’ from producers, or from another intermediary, e.g., retailers buying from wholesalers. Where intermediaries have borrowed from anyone other than the producer, if their sales fall short, the producers lose nothing; they have already been paid and are able to pay off any borrowing they might have done to finance their operations. On the other hand, a chain of intermediaries based on credit may collapse, bankrupting all those involved. In such a case, the producer may suffer eventual repercussions if future sales are impaired. In all cases, immediate problems in repaying debt may be handled temporarily by rolling it over, i.e., obtaining new loans to cover repayment of existing ones, assuming the funds necessary are available at interest rates sufficiently below the expected rate of profit. But that only puts off the need for an ultimate reckoning.244 All these relations of credit, like the other aspects of accumulation, are elements of, and shaped by, class relations and their antagonisms. In Capital, Marx was quick to point this out by drawing attention to the class conflicts around credit and debt in earlier societies. The class struggles in the ancient world took the form mainly of a contest between debtors and creditors, and ended in Rome with the ruin of the plebian debtors. In the Middle Ages the contest ended with the ruin of the feudal debtors, who lost their political power together with its economic basis … Here indeed, the money-form – and the relation between creditor and debtor does have the form of a money-relation – was only the reflection of an antagonism which lay deeper, at the level of the economic conditions of existence.245 Within capitalism, that deeper antagonism “at the level of the economic conditions of existence” is between capitalists and workers. With the availability of industrial credit dependent on capitalist control over workers, the effect on profits and the ability to repay, this is obvious. In the case of commercial credit, class struggle is integral in two ways. First, the capital-labor antagonism exists 244 245 This was how international banks, backed by the International Monetary Fund, handled the international debt crisis of the 1980s and 1990s, created by the Fed’s dramatic increase in interest rates which plunged the world into depression. Those unable to repay their international debts could – IF they met IMF conditions to impose austerity on workers – borrow to finance repayment, thus accumulating even more debt. Capital, Vol. 1, Chap. 3, p. 233, or MECW, Vol. 35, p. 146. 222 chapter 4 wherever workers are hired to transport and sell commodities, e.g., on commercial vessels, always at risk of direct appropriation, mutiny and or piracy. Second, the existence and maintenance of markets often depends on the more general stability of class relations. Where workers are in revolt markets are disrupted and may disappear completely. In general, credit is a vehicle for overcoming barriers (potential ruptures) by buying time, but the allocation of credit depends on relative “credit worthiness” among capitalists, industrial or commercial. The most important measure of “credit worthiness” is the ability of capitalists to control their workers so that they can make the profits required for repayment. The so-called “prime (interest) rate” to large corporate borrowers is accorded to those firms that earn the highest rate of profit, often produced by a high rate of exploitation, s/v. The greater the perceived risk that capitalist borrowers may lose control over their labor force, the higher the “risk premium” and the higher the interest rate charged by creditors. In this way, from the viewpoint of the capitalist class as a whole, loanable funds are allocated efficiently, by providing the most support to those who appear most capable of controlling their workers. In all these cases, where commodities are transferred from seller to buyer first and payment is only made later, credit allows the exchange to occur where it otherwise might not. But there is a sharp separation and opposition between the exchange of goods and the exchange of money, between the creditor and the debtor. In each case, because the debtor may fail to secure the necessary means of payment, that is, fail to sell C’ at high enough prices to be able to repay loans, the possibility of crisis persists. When such a breakdown in sales occurs, Marx calls it a commercial crisis. When the major aspect is the collapse of a set of monetary (credit) relations, he speaks of a monetary crisis. These two often go together, but are differentiated from industrial crisis, in which the breakdown occurs in the sphere of production. I discuss the interrelation of these crises below when I examine Marx’s analysis of how crisis can circulate from one aspect of accumulation to another. 5.4 Summarizing Early in this chapter on the possibilities of crisis, I emphasized how the possibilities that interest me the most are the direct and indirect results of workers’ struggles, of how they can impose an interruption at any of the many points in the circuits of capital, whether in M – LP, M – MP, LP – M – C(MS), … P … C’, C(MS)’ or C(MP)’ – M’. Here’s a brief summary of the possibilities of crisis in each of these moments caused by workers’ struggles. 1. Workers’ struggles can, in the past, in the present and we can anticipate in the future, reduce the availability of M – without which there is no The Possibilities of Crisis 2. 3. 4. 246 247 223 investment at all. Those in the past may have reduced the available surplus value below what is necessary for investment. All of them, past, present and anticipated, can undermine the willingness of creditors to loan money for investment and raise interest rates to unacceptable levels, given that interest must be paid out of surplus value. Both borrowers and lenders will estimate the consequences of any rise in interest rates resulting from the risks they anticipate.246 Workers may cause a crisis in the labor market, M – LP/LP – M, by refusing to enter it or by withdrawing from it. Without LP no production can take place, no matter how much MP may be on hand. Factories that can’t attract workers stand empty. During strikes, the inevitable cry of capitalists is “Our machinery lies idle! Our raw materials are rotting (or rusting) in warehouses!” If workers have won higher wages, raising v, either through the initial deal or in added expenditures necessary to make LP function, with a given total added value of v + s, surplus value will be reduced.247 Any rise in v means a fall in the rate of exploitation, s/v, and a fall in the rate of profit, s/(c + v). If the fall is great enough, it’s a crisis for the investor. Because the value expended on the means of production, M – MP, the investment in constant capital (c), is counted in the value of the final product, workers’ struggles that force an increased expenditure on c, lower the rate of profit, s/(v + c), (ceteris paribus). If workers’ struggles in the production or transport of MP raise its costs or render it unavailable, profit will be reduced or eliminated. While capitalists generally seek a low v, by holding down M in M – LP – C(MS), because it means a higher rate of profit s/(c + v), workers resist the resultant low level of C(MS) available to them. Because of the low wages of his time, Marx emphasized how reduced v often undermined the reproduction of labor-power by decreasing the size of the labor force through starvation or reducing the productivity of labor due to illness, but he and Engels also pointed out how workers revolted against such reductions in their well-being, rising up violently, directly appropriating This is true whether interest is interpreted – as Marx does – as a sharing of surplus value generated by industrial capital or as payment for a service. In the latter case, it forms a part of the costs of production and thus has the same relation to surplus value as other components of c. For one argument in favor of the latter interpretation, see “The Source of Financial Profit – Revising Marx” in Cleaver, Rupturing the Dialectic, 165−180. Assuming constant rates of productivity and of the intensity of labor. 224 5. 6. 7. 248 chapter 4 commodities or fleeing when that seems fruitless. All of which can cause a crisis in simple reproduction.248 At the point of production, … P … C’, all forms of worker struggle can interrupt the circuit by effecting the value components c, v, and s. Ineffi­ cient production (including sabotage) can greatly increase the cost of c through waste, etc., reducing the rate of profit. Absenteeism, loafing, and so on, can increase the costs of labor (v) by increasing the costs of labor turnover, supervision, etc. All reductions of work time or intensity can cut into surplus value, as can reductions of productivity by raising costs per unit, and even globally raising v. All lengthening of production time can raise finance costs of borrowing, etc., increase interest payments and reduce industrial net profit, and thus the rate of profit. When successful, strikes over wages, salaries or benefits have similar effects by raising v directly, thus cutting s, either immediately, or through a rise of v during the next contract of M – LP. Any worker unwillingness or refusal to spend money on consumer goods reduces C(MS)’ – M’, whether the cause be attachment to subsistence farming, reduced income, uncertainty, solidarity with the workers producing them, a conscious minimization of dependence on store-bought goods or a revulsion against the endless advertising of supposedly desirable but actually completely dispensable “goods”, reduces C(MS)’ and thus M’. All direct appropriation by workers ruptures C’ — M’, whether of C(MS)’ or of C(MP)’, undermines the sale of the final product, reduces total value, c + v + s, and thus surplus value, s, the rate of surplus value, s/v, and the rate of profit, s/(c + v). This will be true, whether the appropriation takes place at the point of production, during transportation or at retail outlets. Capitalist willingness to purchase C(MP)’, as with every other aspect of investment, may be undermined by worker struggles, either in-house or during the production or transportation of MP, that raises their price enough to undermine prospective profitability. Not only do workers’ struggles increase the possibilities of crisis along the circuit but they also undermine the availability of credit and loans by risk-conscious creditors to capitalists they see threatened by disruption. This is true for both industrial capitalists and merchant capital Of course, capitalists are not always blind to such effects and sometimes raise v in the expectation of raising productivity and s. An example referenced by Marx was mine owners forcing their workers to eat beans. See, Capital, Vol. 1, p. 718, fn 9, MECW, Vol. 35, p. 572, fn 1. When planned by capital, such increases in v are known today as investments in “human capital.” The Possibilities of Crisis 225 when their managers are forced to turn to financial intermediaries for the wherewithal necessary to keep their businesses running.249 As the cost of credit rises, net industrial and commercial profit falls and with them future investment and future profit. We now turn to an analysis of the forces that predispose all of these theoretical possibilities to become actualized causing actual crises for capitalists and their system. 249 As workers have forced up wages sufficiently to acquire wealth and gain access to credit from banks, the primary uses of loans has been to finance consumption, thus “consumer” credit and debt, whether the consumption be immediate or long term as in the case of consumer durables and housing. Although businesses have come to understand the advantage to them of increased purchasing power, as with business debtors, any reduction of income threatens the ability to repay, the inadequacy of “means of payment” and the threat of default. During periods of widespread rising unemployment and disappearing or falling wages, defaults can be equally widespread, terminating the income to creditors, causing a financial crisis and eliminating those consumption expenditures based on credit. Thus, a crisis for Department II businesses producing C(MS) can have a negative ripple effect on those in Department I. (More on this in the section on the circulation of crisis.) Chapter 5 Predispositions to Crisis Just as Marx and Engels saw many points at which there was a possibility of interruption and crisis in the reproduction process, so too did they see many reasons why those possibilities might be realized through various causes or forces that tend to produce interruption and whose existence, therefore, predisposes the system to crisis. They often speak of “tendencies”; a “predisposition” is a tendency. A predisposition to crisis is a force pushing in that direction; it may cause a crisis or it may be so weak or so offset by other forces that no crisis breaks out. Thus, to identify such predispositions is not to say that crises will in fact occur.1 Because Marx and Engels’ comments on such ­predispositions are scattered throughout their writings, deal with virtually every moment of capital’s expanded reproduction, but are in no way integrated into a reasoned whole, I divide their comments into three groups. (1) Those dealing with the predisposition to interruption at various points within individual units or circuits of capital. (2) Those dealing with the way interruptions in one point within a circuit can circulate within a circuit or to other circuits, thus generalizing the crisis. (3) Those dealing with forces acting at the level of capital as a whole.2 Let us begin with a review of the sequence of processes that must be ­successfully completed to achieve the expanded reproduction of capital. LP LP′ / / M — C . . . . . P . . . . . C′ — M′. M′ — C′ . . . . . P . . . . . C″ — M″ and so on. \ \ MP MP′ 1 This essay rejects the many Marxist interpretations that have conceived predispositions in terms of “iron laws”, which not only predispose but also predestine the system to inevitable “breakdown” and crisis. No teleology here. 2 Remember, capital as a whole consists of more than the sum of the individual circuits; it also includes the reproduction of labor-power. So, despite the way the behavior of forces at the level of the whole includes those within individual circuits, it exceeds them. Because of this, the circulation of rupture between industrial circuits does not necessarily lead directly to the totality despite being a part of it. If we treat the reproduction of labor-power in terms of the “little” circuit LP – M –C(MS) and treat the sum of those circuits as the sum of all reproduction processes, the behavior of the total social capital is more closely approximated by the behavior of Σki + Σhi , where ki = industrial circuits i; hi = reproduction circuits i. The same is true if we extend Marx’s little circuit to LP – M – C(MS) …P… LP*, which makes the reproduction of labor-power more explicit. © Harry Cleaver, 2025 | DOI:10.1163/9789004708631_006 This is an open access chapter distributed under the terms of the CC BY-NC 4.0 license Predispositions to Crisis 227 The smooth, expanded reproduction of the circuit involves growth in each element of the circuit – albeit often at different rates, e.g., a rise in the organic composition of capital will involve MP growing faster than LP.3 In the above representation, the second whole circuit (M′ to M″) involves increased quantities of money capital, labor-power and means of production as well as more final product and more sales revenue than in the first circuit (M to M′). My organization of Marx and Engels’ comments on the predispositions to breakdown follow the same outline as those on possibilities; I examine their analysis as it pertains to each stage of the circuit. In the introduction to this essay, I state that “the central thrust of my interpretation . . . sees accumulation as the expanded reproduction of a fabric of capitalist control that is always tenuous, repeatedly threatened and often ruptured by workers’ struggles. Crisis is thus, most basically, a ‘working-class produced’ tearing of that fabric and a positive consequence of workers either undermining some aspect of capitalist control or elaborating a positive alternative which also threatens that control.” A corollary of this interpretation sees the most fundamental “predisposition” to crisis to be workers’ (our) resistance to subordination to the capitalist organization of production, of consumption, of life. Therefore, as I examine each moment of capital’s organization, I suggest the origins of that resistance, why we resist, what predisposes us to resist, how we go about it and the problems we create for our would-be overlords in doing so. 1 Predispositions in the First Stage of the Circuit: Investment As with possibilities, I begin with the issue of whether enough money can be amassed by capitalists to launch or renew their investments. What forces predispose capitalists to crisis in gaining enough money for desired investment? Then, assuming they do get access, what predisposes failure in markets for labor-power and for means of production? 3 The displacement of workers by machines (capital’s relative surplus value strategy, an increase in the technical and therefore organic composition of capital, c/v) tends to slow the growth of the employed (waged or salaried) labor force. On a large enough scale, it can reduce the number of employed, but this does not reduce the size of the entire labor force, which includes the already unwaged, augmented by displaced workers. Locally, an overall shrinkage can happen if large numbers of the unwaged die off or emigrate, such as during and after the Great Irish Famine or the more recent devastating wars in the Middle East, or as a result of genocide as in Myanmar, Palestine, and the Congo, but even then, the impact on the totality of capital is marginal as world population continues to grow. 228 chapter 5 1.1 Forces Limiting Access to Money for Investment, M We have seen how difficulties in amassing the money, M, required for investment have the potential to thwart this first stage of the circuit before it even gets started. Workers’ struggles can create difficulties in two obvious ways. First, any past struggles by workers that reduced profits can undermine new investment by reducing the surplus value available. Worker success in raising wages faster than capitalists could raise productivity – thus undermining relative surplus value – would do just that. So would direct appropriation of the means of production or final product that undermines profits by raising costs, or success at imposing laws – such as limits to the working day – that reduce the ability to extract absolute surplus value. Why workers are often predisposed to create these problems for their employers I leave to each of the following sections. Second, to the degree that retained earnings are insufficient for planned investment and capitalists have to borrow, I have argued that past struggles can undermine the ability to borrow by increasing both the investing capitalists’ and creditors’ perceptions of risk. Clearly, a past failure to realize at least the average profit can mean not only inadequate retained earnings for new investment but also that creditors are more likely to refuse to loan or charge such high rates of interest as to impede borrowing sufficient funds to launch a new or expand an existing circuit.4 Failure breeds failure. (More on this when I turn to the circulation of crisis in Section 5.4) If we assume, instead, that the previous circuit was completed successfully, rendering at least some investable retained surplus value, then if that surplus value is enough to launch the planned investment there is no problem. If not enough and would-be investors require borrowing, potential creditors will be reassured by their past success. Success breeds success. However, as I discussed previously, another key issue of concern to investors and creditors, is the expected future rate of profit on any proposed new investment – which few are willing to assume to be a simple projection of past experience. Clearly, any perceptible forces at work tending to reduce expectations of future profits will not only reduce the inclination of some capitalists to invest, but also that of financial capitalists to extend new loans. Creditors, as I have mentioned, express their estimations of risk by the conditions they set 4 This is true whether the attempt to borrow is from domestic financial intermediaries or foreign ones. Already in the mid-nineteenth century both banks and stock markets operated internationally, loaning money, or offering shares to foreigners or extending operations into other countries. Just as capitalist commerce included international trade, so too were financial institutions increasingly operating across borders. Industrial firms were seeking raw materials abroad whether to buy or produce themselves through direct investment – ­wherever profit seemed likely, whether in protected colonies or elsewhere. Predispositions to Crisis 229 and the rate of interest they charge on loans. The greater the estimated risk, the more severe the conditions and the higher the rate of interest and thus the cost of borrowing. Interest rates high enough to reduce the expected rate of profit below the average can cancel investors’ willingness to borrow and, as a result, their planned investment. While all kinds of factors influence estimates of risk, most are contingent upon particular historical circumstances, e.g., weather and its effects on harvests of raw materials, their price, etc., or the state of foreign relations and the likelihood of an outbreak of war and military hostilities that would disrupt trade, or, less dramatically, potential changes in legislation, both at home and abroad, affecting trade and immigration, or, central bank monetary policy in response to excessive inflows or outflows of money, etc. The one factor that is built-in to every stage of the capitalist circuit, indeed in every aspect of society reshaped by capital for its own purposes, albeit variable in its intensity and effect on calculations of risk, is class struggle. The only question is how intense and how disruptive. All capitalists contemplating investment and all creditors contemplating loans to such capitalists know this and, as a result, their estimations of risk and the implications for future rates of profit are based, in part, on their assessment of the current state of class struggle and its future prospects.5 5 With the development of capitalism, the estimation of risk has come to be done both internally, within corporations, both industrial and financial, and externally by independent businesses. The most obvious traditional businesses preoccupied with risk assessment were insurance companies and banks. For example, banks acting as financial intermediaries between investors and their investments have employees devoted entirely to risk assessment, who share their results with both management and investing clients. I discovered an example of this in the wake of the Zapatista uprising in 1994. That many investors thought that their risks had risen was manifest in how they were pulling their “hot” money out of the Mexican stock market and repatriating it across the border to the US. Chase Manhattan Bank’s newsletter to “emerging market investors” was soon giving its own assessment of risk to its clients as well as advising the Mexican government – then being run by the PRI – to “eliminate” the Zapatistas to stabilize the investment climate and, if necessary, to cheat in forthcoming elections to retain control of the government to the same purpose! Despite this advice, military action against the Zapatistas and familiar cheating in the 1994 elections, capital flight continued. Because the Salinas government ran down foreign reserves trying to defend the peso, the new government under Zedillo was forced to marginally devalue the peso. But this triggered even more massive capital flight and a dramatic devaluation, i.e., the “Peso Crisis.” These were modern versions of the “money drains” Marx noticed and analyzed in the nineteenth century. See International Monetary Fund, “Factors behind the Financial Crisis in Mexico,” World Economic Outlook, May 1995, pp. 90−97. The Peso Crisis was serious enough to ripple across other “emerging markets.” Unfortunately for capitalists, so did the indigenous uprising that caused it. See, H. Cleaver, The Zapatista Effect: The Internet and the Rise of an Alternative Political Fabric, Journal of International Affairs 51, no. 2 (Spring 1998): 621−640. 230 chapter 5 Such assessments examine, first and foremost, the immediate pool of labor – both active and reserve armies of labor. Are those workers available and exploitable? Will they accept currently profitable wages and working conditions? Or, are they organizing and resisting, posing potential threats? Beyond the immediate pool, to what degree is the wider situation promising or threatening? Potential employers and creditors also take into account even distant class struggles that might influence local struggles. Some examples, in chronological order. Fear ran through investors in Britain in the wake of the French Revolution in 1789. As inspired workers organized in Britain and the state tried to whip up patriotic opposition to the revolution, intellectuals debated, penning either denunciations, such as Edmund Burke’s (1729−1797) pamphlet Reflections on the Revolution in France (1790), or support, by the Welsh Dissenter Richard Price’s (1723 – 1791) Discourse on the Love of Country (1789), the poet William Wordsworth’s (1770−1850) Letter to the Bishop of Llandaff (1793), and radicals Thomas Paine (1737−1809) and Mary Wollstonecraft (1759−1797) in his Rights of Man (1790) and her A Vindication of the Rights of Men (1790).6 Slavers and their creditors throughout the Western Hemisphere trembled in 1791 when revolution exploded in the French colony of Saint Domingue and succeeded by 1804 in throwing the slave owners off the island and establishing Haiti as the first independent, free nation of ex-slaves in the world. Estimates of risk in Britain obviously rose considerably with the growth of the Chartist Movement and experience with its protests, petitions and strikes in 1839, 1842, and even more so in 1848, given the revolutions on the continent. Worries about workers’ rebellion circulating from the continent to the ­British Isles was palpable and manifest in both parliament and daily journalism. ­Estimated changes in worker struggles, whether based on purely local circumstances or on potential foreign influences, certainly affect estimates of risk, interest rates on loans and thus the availability of money for investment. The threat, and the estimate of risk, varies, but the autonomous power of workers to disrupt the circuit guarantees a predisposition to crisis within the system. As I move through the various stages of the circuit this will become ever clearer. Assuming the problem of coming up with required investment funds is solved, the first stage of the circuit involves hiring labor-power and buying means of production. As I have mentioned, among the possible difficulties are (1) that LP and MP might not be available with the proper characteristics, or 6 See, Ruth Mather’s illustrated “The Impact of the French Revolution in Britain” (2014). For a recent, insightful re-examination of Thomas Paine, see Peter Linebaugh’s introduction to Thomas Paine: Rights of Man and Common Sense (New York: Verso, 2009). Predispositions to Crisis 231 (2) that they might not be available in the necessary amounts for expanded reproduction. 1.2 Forces Interfering with the Supply of Labor-Power, LP In the first investment of their capital, or in any subsequent investment, capitalists are confronted with the problem of whether they can hire workers in sufficient numbers, with the necessary skill mix, who can be expected to work for a wage on terms and in a manner, which will, when combined with the cost of means of production and the revenues of the sale of C′ at expected prices, achieve at least an average profit. As I noted in Chapter 4 on “possibilities,” this can be a problem because both those not yet hired and those already hired may resist. 1.2.1 Avoidance of the Labor Market Why do so many, from the children of waged or salaried workers to adult unenclosed peasants avoid entering the labor market, an obvious source of income in capitalism? For one thing, they are often made aware – from stories told by ­others, from anti-work songs, or from observation – of the violent, alienating, and exploitative character of work-for-capital and of its uncertainty. Given how obvious it is that children have a natural predisposition to play, to explore the world, what’s the likely effect then on their attitudes toward waged labor of observing their parents coming home each day from the violence of hard labor in waged jobs or from the emotionally exhausting work of salaried employees, coping with annoying bosses or recalcitrant underlings? What effect too of frustrated parents all too often bringing their frustrations home and then taking them out on their kids and spouses?7 The factory inspectors, upon whose reports Marx and Engels drew so often, provide plenty of accounts of the horrors of waged work in that period and evidence of how only poverty drove many into the labor market and the jobs to which they gave access. The “industrial novels” of the nineteenth century often portrayed the frustrations of middle-class managers, torn between the demands of profit-maximization and those of workers. Most workers, whether waged or salaried, had little job security and with the ups and down of investment and crisis were often hired today, and fired tomorrow.8 Childrens’ awareness of all this alone produces a resistance to entering the labor market. 7 In modern times, little has changed. Bruce Springsteen’s song Factory (1978) comes to mind, about his father coming home from working in a factory “with death in his eyes” and “Somebody’s gonna get hurt tonight.” 8 An uncertainty which has grown in recent years with the proliferation of precarious “gig” jobs of short duration, with no opportunity for advancement and few or no benefits. See George Caffentzis, “Throwing away the [Job] Ladder: The Universities in the Crisis,” Zerowork 1 (December 1975): 128-142. 232 chapter 5 Those young people lucky enough to have alternatives, e.g., schooling or travel, were clearly inclined to seize the opportunities to delay entering the labor market. This was especially true for those whose parents’ income could pay for private tutors for their children and eventual access to better jobs. Those less lucky – and that included most working-class children – found themselves under the same pressures of poverty as their parents. Whether farmed out by parents to capitalist employers or simply urged to help find a way to supplement family income at very early ages, they found avoidance of the labor market extremely difficult. With even reluctant children easier to control than adults, before the enactment of child labor laws capitalists were anxious to put them to work as young as possible at whatever jobs they could be trained to handle. So whatever satisfaction children and their parents might gain from bringing home some small contribution to family income was certainly offset by long hours working in dust-filled mines or “fluff” polluted textile mills. Once workers and reformers were successful at getting child labor laws passed, children began to be incarcerated in schools rather than mines and mills. Whereas workhouses were generally made as obnoxious as possible, with the objective of driving the unemployed back into the labor market, schools were pitched as being better alternatives because they provided the possibility of some learning, learning that was good for its own sake and might also open the way to better jobs. But precisely because they were, like labor markets, bootcamp-gateways to jobs, discipline was higher on the agenda of schoolmasters than learning. While economists like Adam Smith or Jevons saw schools as opportunities for the ideological brainwashing of children into accepting capitalism and its economic “laws” as natural, the primary day-to-day challenge facing those managing the schools was turning energetic, excitable, curious children into potential workers who will do as they are told, the way they are told by their teachers today, in preparati0n for their employers tomorrow. And, to enforce discipline, schoolmasters were not loath to use the coercion of corporal punishment (and often sexual harassment) to obtain these results.9 It’s easy enough to see how this character of schools has predisposed some children subjected to such regimes to reject both the immediate discipline of school and the anticipated discipline of waged jobs. Such refusals make up the story of “drop out culture”, “juvenile delinquency” and “gangs”, whether in 9 As late as the early 1960s, when I was still in high school, corporal punishment (“whacks” with fraternity-like boards) was still being meted out to those of us who chaffed at arbitrary rules. It was, I gather, worse in Britain where punishment was administered with canes. Watch Lindsay Anderson’s film If … (1968), which includes both such punishment and student revolt against it. American “teenage movies” rarely depict such punishment, and merely mock school disciplinarians, e.g., Ferris Bueller’s Day Off (1986). Predispositions to Crisis 233 schools or in the streets where children have sought fellowship where the rules of adherence have been much looser. Given both the frequent dearth of available jobs – due to recurrent crises – and the characteristics of the work involved when jobs were available, many adults as well as young people have opted to find ways to survive outside the frameworks offered by capitalism. Despite capitalist ideology preaching that “growing up” involves accepting its rules, especially the rule that wages or salaries provide the only legitimate access to consumer goods and other “private property”, the same urge to freedom born naturally in children persists in many adults who refuse those rules and make their own or join with others with the same predisposition. Thus, adult beggars who ask for (and sometimes demand) others to share, robbers who directly appropriate what they need or want, and vagabonds who may engage in either activity while also living off the land. The predisposition of peasants and small farmers to cling to their land has clearly been based on the self-determination and independence it affords. The ability of agriculturalists to grow enough crops, raise enough animals and forage the commons allows them to weather all but extreme natural and human-made disasters (epidemics, destructive floods, drought, earthquakes) – including the vagaries of capitalist markets. These abilities have provided them an alternative to the deadly long hours of labor capitalists have imposed – until curbed by workers’ struggles. Many traditional farming practices have often involved much less work. In some areas, winter weather alone ends much farm work.10 In both northern and southern climes, slash-andburn agriculture has been common and entails leaving planted areas alone during growing seasons.11 The same has been true for hunters and gatherers. Long thought to barely scratch out a living, modern research has revealed their methods to leave plenty of time for cultural activities.12 Given the difficult living conditions afforded waged workers, whether in mill towns, mining camps or cities, why move from a well-known countryside with all its resources 10 11 12 As for modern family farmers, having grown up in the Ohio portion of the “corn belt”, I long saw how frozen fields basically gave my neighbors most of the winter free of work. Years later, I spent many hours playing an online game (MMO) with a farmer in Michigan, whose fields were buried under two feet of snow, giving him far more time to play than I had. Obviously, this was less true for those whose primary occupation was husbandry because animals require year-round maintenance. On the limited work of agriculturalists who regularly shift their plantings, see Harold Conklin, “The Study of Shifting Cultivation” Current Anthropology 2, no. 1 (February 1961): 27−61. On the limited work of hunter-gatherers, see “The Original Affluent Society” in Marshall Sahlins, Stone Age Economics (London: Routledge, 2017). 234 chapter 5 (farmland, game, medicinal plants, and spiritual connection) or from equally well-known communities where one is part of a social network of mutual aid?13 This is the flip side of Marx’s analysis of “primitive accumulation” – to which that city-boy paid little attention, notoriously dismissing (until late in life) agriculturalists as dumb local yokels unable to organize in collective self-interest.14 Yet, many are the sources of farmer and peasant resistance to enclosure and colonialist attempts to impose capitalist social relations on whole populations. As for the predisposition of older folks to avoid the labor market and waged or salaried jobs, it depends on how they have been living. In agricultural and hunting and gathering communities, quitting previous adult activities may come naturally from age putting limits on what one can contribute. Where extended families and close social networks prevail, mostly it just means changing the nature of one’s participation, e.g., switching from fieldwork or hunting to childcare or other more sedentary activities. But for waged and salaried workers, retirement from working for capitalists means leaving an artificially constructed, authoritarian workplace of commodity-producing workers for what? As capitalists gradually urbanized their world, concentrating factories in cities to minimize costs, their practices of creating or ending jobs according to their own needs, of moving them from less profitable areas to more profitable ones, increasingly imposed high mobility on workers. That mobility has made the formation or reproduction of both extended families and coherent communities outside of work more and more difficult. Yet, waged and salaried workers have clearly fought for laws mandating retirement at ages where age-related disabilities are not a factor. They just want out. But they have also fought for income to sustain them when they are no longer working. They first won such laws and such income support in Germany in 1889 as Bismark sought to ward off greater concessions to the burgeoning workers movement. 13 14 In capitalist cities, wealth in connections to the land has largely disappeared. Yet, such connections have long existed and continue to exist in many rural communities of small farmers or indigenous peasants. One example: for the indigenous Maya of Chiapas,­ Mexico, who call themselves “the people of the corn”, both the cultivation of maize (milpa) and its consumption (comida) are vital elements of their spiritual connections to both the land and each other. See: Gustavo Esteva and Madhu Prakash, Grassroots Post-Modernism: Remaking the Soil of Cultures (New York: Zed Books, 1998) Chapter Three, “Beyond the Individual Self: Regenerating Ourselves.” That view, expressed in the Eighteenth Brumaire and in his analysis of “proletarianization”, was eventually modified by his studies during his final years, of the Russian peasant mir and other agricultural societies. It poisoned generations of Marxist attitudes towards farmers and peasants, only recently modified by the discovery of his later notes and writings and by the resurgence of very well-organized movements of peasants and indigenous peoples. Predispositions to Crisis 235 (See, Chapter 2, Section 3.11.) Where they have won it, retirement means answering the question “Now what?” For those who have successfully stolen or wrested enough time away from jobs to build other networks of connection, the answer may be obvious: increased time and energy for whatever activities constitute those networks. Those whose lives have been totally eaten up by their jobs, either because they have been endless and exhausting or because they have bought into the workaholism pushed by capitalist ideology, the answer is often anything but obvious. The results for them, alas, are often rather pathetic: taking up some “hobby”, searching for some kind of social life, maybe volunteer work, maybe (alas and alack) a return to the labor market, and all too often early death. 1.2.2 Flight from the Labor Market I already discussed in Chapter 4, Section 3.2.2.2 the possibility of flight, either from the labor market to open lands or from one labor market to another. Both kinds of flight, if large enough, can cause a crisis for those trying to hire in the labor market being abandoned. But what predisposes workers to flee or walk away from a labor market in which they have already participated? The obvious reasons are 1) conditions in both the labor market and in the work lying beyond that portal and 2) the options available. When taking a job through the labor market leads to the discovery that instead of that market being a rosy moment of equal exchange leading to friendly collaboration between capitalists and workers, it’s more akin to Dante’s gateway to Hell with a similar welcome “All Hope Abandon Ye Who Enter Here,” many workers will go elsewhere if they can. For Marx and Engels, among the obvious conditions which drove workers away were the early capitalist efforts to reduce wages as low as possible and the horrible conditions of work (long and often dangerous hours). Such conditions result in death for some but flight by others. The extremely long hours – effectively reducing wages below subsistence – and unsafe working conditions shorten lives, killing slowly or quickly, reducing the labor force, or slowing its growth. Chapter 10, in Volume 1 of Capital, on the struggle over the working day provides abundant evidence of how capital’s “orgies” of exploitation undermined the very reproduction of the working class.15 Who would not flee such conditions if they could? 15 Contemporary refugees from wars – the worst of working conditions – and those fleeing exploitation continue to cross borders, not in the hope of free land, but to find better labor markets and working conditions. Such movement is better understood as one strategy of those in the temporary but still active (floating) reserve army of labor. Among the many films about such folks see, Il Norte (1983) about Guatemalans fleeing exploitation 236 chapter 5 Another whole set of conditions, which might also provoke flight, were the miserable living conditions of workers when not at work in mines, fields, or factories – as sketched in Chapter 25 of Capital and described in detail by Engels, conditions conducive of daily misery, disease, and contagion. Lastly, it should be obvious that for legally enslaved workers, escape and flight was always desirable, when possible. This had to have been especially true in the period of the slave trade, which, Marx argued, made their replacement relatively cheap, so they were often worked to death.16 1.2.3 Other Sources of a Shortage of Labor-Power As I outlined in Chapter 4, in addition to the reluctance of some workers to enter the labor market and the flight from it by others, disease and starvation often took a heavy toll on the number of workers available to capitalists for hire as did military recruitment in the Age of Imperialism. Finally, in spite of 16 and repression to the US. (A byproduct, we should note, of US interventions in Central America and the deportation of criminals.) Indeed, despite the recurrent effort to pit locals against recent immigrant workers, most of the US labor force is composed of immigrants or descendants of immigrants who have successfully found new jobs. See, especially, Chapter 10, Section 3: “Branches of English Industry Without Legal Limits to Exploitation.” That “vampire” thirst for more work, no matter the cost to workers, was curbed by struggle, but capitalists for a very long time continued to believe (or pretend) that the relationship of wages and profits was zero-sum, i.e., any increase in wages would diminish profits. As capitalists shifted from absolute to relative surplus value strategies, they and their economists eventually figured out (or admitted) not only that increases in wages were not necessarily a threat – IF they were offset by increases in productivity – but that as the source of consumer demand, rising wages could, by raising aggregate demand, induce more investment, more employment, more output and more profits. This recognition came with the late nineteenth century marginalist revolution in economic theory. (For more on this see Chapter 6) The main economist who elevated business perception of wages and consumer demand from onerous burdens to engines of capitalist growth was John Maynard Keynes in his General Theory. Zero-sum thinking came to be replaced, but the idea of a “normal” labor market being one in which wages didn’t undermine profits remained. For the last several decades, we have witnessed neoliberal efforts to undo all the safeguards won by workers since Marx and Engel’s time, including health safeguards, e.g., attacks on Social Security, on Medicare, the refusal of Medicaid by state governments, Trump’s dismantling of pandemic response team and his more general disinvestment in preparedness for pandemics, despite SARS and MERS, as well as his criminally negligent response to the Covid-19 pandemic. Added to that have been the attacks on women’s health, especially reproductive health, e.g., abortion, accelerated by the recent Supreme Court overturn of Roe vs Wade. All these are now taking their toll on workers’ lives, up and down the wage and salary hierarchy. Leaving aside completely their moral degeneracy, the capitalists responsible have forgotten how dramatic reductions in the working-class population, e.g., during the Black Death, have led directly to major gains in wages by the reduced number of workers. Predispositions to Crisis 237 overwhelming patriarchal structures of power, women’s struggles to free themselves from the role of broodmare have been seen by capitalists as predisposing the labor force to reduction, potentially higher wages and lower profits. 1.2.3.1 Disease and Starvation The possibilities of serious epidemics, starvation and dramatic increases in death rates and consequent collapses in population and labor supply, mentioned in Chapter 4, turned into reality again and again, in place after place in the nineteenth century. Why? The most obvious cause lay in the character of capitalist development. The vicious exploitation of workers and the resulting poverty and living conditions made them vulnerable to hunger, malnutrition, and disease. The enclosure of the best land and its conversion to the cultivation of commercial, export crops, made food production on marginal land for local consumption vulnerable to erratic fluctuations in weather. Couple these vulnerabilities with the increased circulation of disease brought on by overseas colonization, the steady growth of long-distance trade and the associated movements of armies and navies, and you have an emerging world system predisposed to local instability, the circulation of illness or food shortages and, frequently, social uprisings in response. 1.2.3.2 Military Poaching of Workers The need for military forces within capitalism parallels that for police forces. Both follow from the antagonistic character of capitalist social relationships in which exploitation and resistance to it can be small scale and frequent, requiring police action, or large scale in violent uprisings which require not only police but also military forces to preserve or restore capitalist control. The latter has been true both in the case of local conflicts, e.g., Luddite attacks on particular factories, and in the massive Chartist strikes and protests against government policies. By requiring ever more people to be put to work and ever more land and raw materials for them to work up into profitable commodities, so too has capitalism required the expansion in the size of its police and military forces, on both land and sea. Throughout the nineteenth century’s “Age of Imperialism”, capitalist and military expansion went hand in hand in the subordination of new lands, new resources and new people to capitalist modes of organization. But this expansion, radiating outward from every country where capitalism has become dominant, has also led to conflicts among capitalists from different countries as they have competed for resources, labor supplies and markets. Again and again, capitalist influence on governments has resulted in military conflicts, from marginal skirmishes to full scale wars. And wars require 238 chapter 5 additional cannon fodder, which can only be drawn from either the waged labor force or the reserve army of unwaged. As I showed in my historical sketch, essential to Marx and Engels’ understanding of these conflicts, including wars between competing blocs of capitalists and their associated governments were the dynamics of class conflicts, both in terms of the capitalist motivations and the responses of workers. Remember their analysis of the Franco-Prussian War in which they denounced both the French government’s unprovoked attack on Prussia and then the Prussian counter-invasion of France. In both cases, they supported resistance to what amounted to capitalists trying to enhance their own power by pitting some workers against other workers to the detriment of both and they drew conclusions about appropriate worker strategies in the light of their analysis of the class conflicts at the heart of both phases of that war. Given that soldiers and sailors always suffer in wars, and wars have always been launched for capitalist purposes, not those of workers, there has always been resistance. Individuals and small groups dodge recruitment, desert from the ranks, or organize opposition such as that of the First International to the Franco-Prussian War. That resistance, of course, has been why capitalists have had to use force to coerce workers into the military and then to keep them there. As a result of these class antagonisms, every war has had two fronts: the one facing the declared enemy and the home front of resistance and repression. While those from better off families have often bought their way out of conscription, or bought commissions as officers rather than serving as enlisted grunts, those from peasant families in the countryside and from working class families in cities have been more likely to refuse conscription (draft dodgers in Britain or the U.S., insoumis in France) or collectively protest in “draft riots” – such as the one in New York City in 1863 – or go underground, resorting to criminal activities to survive while on the run.17 To obtain voluntary recruits, the military has used the typical capitalist method of offering wages, complemented by ideological appeals to patriotism and the vilification of the enemy of the day, for their behavior, for their inferior culture, for their language, for their religion, or even for their physical appearance.18 17 18 See the analysis in Rouanet and Piano “Drafting the Great Army”, op. cit. Although, where criminal activity involved joining organized crime families one can argue they were simply moving from the legal labor force into the illegal one but still available to capitalists. In modern times, while old methods have persisted, e.g., Trump buying his way out of service, we’ve also seen substantial draft resistance based on anti-war principles with resistors willing to go to prison if not excused or accepted as “conscientious objectors.” See, Ananya Ravishankar, “Linguistic Imperialism: Colonial Violence through Language”, The Trinity Papers, 2011-Present (2020). From cartoons in newspapers to Predispositions to Crisis 239 The generalized poverty in the nineteenth century made the pay offered for joining either local militias or standing military forces often appear higher than that available in civilian jobs. “Appear” because after “taking the King’s Shilling,” recruits into the British army often found themselves forced to spend their pay on their equipment and subsistence. This exploitation of soldiers doing the work of imposing discipline on other workers has contributed, not surprisingly, to chronic problems with desertion in every army based on conscription. Voluntary recruitment for wages was less effective for the naval forces because 1) wages were always higher on merchant ships and 2) navies were notorious for their shipboard discipline (floggings, hangings) and horrible working conditions (brutal work rotations, poor food, scurvy). As a result, navies were forced to have much greater recourse to legal impressment – the forcible kidnapping of sailors or civilians for military “duty.” Some were rounded up by “press-gangs” in cities, others were appropriated from merchant vessels, in dock or at sea. The impressment of Americans by the British navy to crew its warships was one of the “colonial grievances” that led to the American Revolution (1775−1783) and contributed to a second war with the British in 1812.19 1.2.3.3 Reductions in Family Size The most obvious internal predispositions to reduce the size of families are rising income and women’s struggles. With respect to rising income, while the best efforts by workers to raise wages – always supported by Marx and Engels – sometimes had sufficient success to cut into profits enough to be judged a crisis by capitalists, there’s little evidence, despite Malthus’ claims, that such shortterm increases were sufficient to warrant much change in the size of families. With respect to women’s struggles, given how the work of childbearing and rearing always fell to them, they often took what measures they could to have fewer children. 19 government-produced posters designed to foster support for war, the imagery deployed has often been racist, e.g., against the Japanese in WWII or Vietnamese during the US war in Indochina, or ­portraying the enemy as inhumanly vicious, e.g., against the German “huns” in WWI, “krauts” in WWII, and “commies” during the Cold War. More generally, see, Christopher Magra, “Anti-Impressment Riots and the Origins of the Age of Revolution,” International Review of Social History 58, Special Issue 21 (­December 2013): 131−151. Herman Melville’s novel Billy Budd: Sailor (1891), which narrates such impressment in 1797 and the fate of one impressed American sailor, certainly provided popular support for resistance. 240 chapter 5 Successes in getting laws passed which limited the working hours of waged children and women, to the degree they were actually enforced, were more likely to have had some bearing on attitudes toward family size. The fewer hours of work for a wage, the more hours of the work of reproducing laborpower, more housework for women and schoolwork for children as capitalists engineered the “nuclear family” and widespread public schooling, consigning women and children to the work of reproducing labor-power. Precisely because of their lack of attention to internal family dynamics – beyond its patriarchal character defined by the husband/father’s­ domination – Marx and Engels failed to analyze the struggles of women to reduce their workloads in the home by having fewer children. Yet, we know that women throughout the income hierarchy, from unwaged slaves, through waged “proletarians”, to “bourgeois” women have had recourse to various methods of contraception and abortion to do just that.20 Had Marx broadened his “Worker’s Inquiry” to include housework and schoolwork as well as the work of producing profitable commodities, he would certainly have queried women on their struggles to limit childbearing. But he did not. So we must have recourse to other authors to recognize the existence of such struggles, how they developed and how both men and capital responded.21 Of the predisposition among many women to have fewer children, there can be no doubt, only access to knowledge, opportunity and resources varied, and the pattern of that variation was determined both by the struggles of women and by the efforts of those who sought to control them. (On efforts at control, see Chapter 6, Section 7.2.3.3) 1.2.4 Overzealous Investment Another predisposition Marx and Engels both recognized, lay in the ­tendency for capital to invest and expand as rapidly as the degree of exploitation allows, 20 21 See, for example, Andrea Tone, Devices and Desires: a history of contraceptives in America (New York: Hill and Wang, 2001). Our knowledge of the use of contraception by enslaved women to subvert being used to breed more slaves is largely thanks to George Rawick’s work assembling/editing slave testimonies in The American Slave: A Composite Autobiography (Westport, CT: Greenwood Publishing Co., 1972−76). See his overview of slave after-work activities in From Sundown to Sunup: The Making of the Black Community in Volume 1, and Liese Perrin, “Resisting Reproduction: Reconsidering Slave Contraception in the Old South” Journal of American Studies 35, no. 2 (August 2001): 255−274, which tells of how women slaves chewed the roots of their owners’ cotton to avoid having children. For a modern effort to do just this, see Alisa Del Re, “Workers’ Inquiry and Reproductive Labor” Viewpoint Magazine 3 (September 25, 2013) https://viewpointmag .com/2013/09/25/workers-inquiry-and-reproductive-labor/ accessed 8-23-2024. Predispositions to Crisis 241 a propensity that predisposes the demand for labor-power to outpace supply. The frequent realization of this possibility (discussed in Chapter 4, Section 3.2.3) derives from both capitalists and speculators trying to take as much advantage as they can from expanding markets. In such boom periods, the slower growth of the labor force compels capitalists to compete for workers, by offering higher wages, potentially to unprofitable levels. The degree to which this affects individual capitalist firms depends on contingent factors, but the tendency will be there, as it will be for capital as a whole. Thus, a general expansion may lead to a rise in v, a fall in s/v and a reduction in s/(c + v) (ceteris paribus). A substantial fall in the rate of profit, of course, tends to cause a crisis – if capitalists judge that fall to be sufficient to withdraw from investing. What Marx doesn’t discuss at this point in Capital, but which he does make clear in his debate with Weston is how during such periods of rapid accumulation workers’ self-­ organization and militant actions can take advantage of tight labor markets to drive wages up higher than they might otherwise rise if left purely to competition among capitalist employers. 1.3 Forces Causing a Shortage in the Supply of the Means of Production, MP In the case of means of production, buyers confront supply crises in either low quality or shortages, which increase prices and costs that undermine their profits. These can be the result of either a disruption in the production of MP (including its transportation), …P…C(MP)’, or one in its sale, C(MP)’ – M. In Chapter 4, I discussed several possibilities in both cases. The question is what forces predispose those possibilities to realization? Forces that disrupt production of MP, I discuss in the next Section; disruptions in availability of MP in markets, I discuss in Section 3. 2 Predispositions in the Second Stage: Production Turning to the second stage of the circuit: let’s examine the forces tending to interrupt capitalist production. Failure to complete the transformation of the two elements of production LP and MP into the final product C′, must involve either the failure of labor-power to become living labor or the means of production breaking down. Breakdowns in the means of production may be the result of 1) their inherent characteristics, e.g., the tendency of fixed capital to wear out, or the poor quality of raw material, or 2) exterior forces, e.g., worker sabotage or natural disasters. While natural disasters are episodic, because workers set the means of production in motion, they have the most continuous 242 chapter 5 power to create a crisis in production. The question is: what forces are at work that predispose them to do so? 2.1 Predispositions to Breakdowns in Labor-Power, LP We must recognize disruptions in the conversion of labor-power into actual labor, as with those of M – LP, as a fundamental dimension of class struggle. The negotiation of a contract, formal or informal, between employers and workers by no means guarantees, as Marx shows repeatedly in Volume 1 of ­Capital and as managers have always known, to what degree workers will convert their labor-power into work. And this is true both of the production of use-values and of the generation of value and surplus value. Besides workers’ struggles that reduce the amount of work being done, I’ve also noted how the vagaries of nature may also reduce the ability of workers to work, irrespective of worker inclinations. Nature can debilitate or kill. But is there anything which predisposes those results? 2.1.1 Predispositions of Workers to Work Less The class war over the amount of work that actually gets done, Marx shows, in Volume 1 of Capital, is one in which each side has certain aims about how long, how intensely and under what conditions work will be performed. Capitalists seek more work, regardless of conditions, while workers seek less work (shorter, less intense), safer, and less alienating work. There is thus a struggle that takes many forms. Against capital’s techniques of control such as the wage hierarchy, despotic oversight, using differences such as race and ethnicity to turn worker against worker, or piece-wages designed to foster greater intensity and competition, workers pit absenteeism, collaboration, sabotage, loafing on the job, strikes, and so on. Why? What predisposes workers to such actions, whether they take them or not? The general answer is the way of life capitalists seek to impose harms people and confines their activities to those that benefit its harmful system. How does it harm? Marx’s answer is that the amount and kind of work capitalists impose both exploits and alienates. It exploits by imposing more work than necessary to reproduce workers’ labor-power.22 It alienates because­ 22 In Marx’s writings, the term “exploitation” is reserved for the extraction of surplus labor and surplus value from waged or salaried workers producing profitable commodities, C′, with “surplus labor” defined as labor in excess of that required to produce the means of subsistence required for the reproduction of workers’ labor-power, i.e., “necessary labor.” Therefore, he does not use the term “exploitation” in reference to all the labor done by workers in their homes, schools and elsewhere that contributes to creating or repairing labor-power. Yet, clearly, to the degree that such labor reduces the amount of necessary Predispositions to Crisis 243 capitalists organize work and ownership so that they, not workers, control what is done, how it is done, for what purpose, and the disposition of the products of that labor, which they use to impose more work and acquiescence to the system. It is in the pursuit of maximum possible exploitation – to maximize surplus value and profits – that capitalists organize work so as to minimize their costs, often at workers’ expense. As Marx’s illustrates in Capital and elsewhere, that effort to minimize costs often leads capitalists to refuse to alleviate dangerous working conditions with resulting harm to workers both physical and psychological.23 Because capitalists tend to discard old or injured workers, as they do with broken machinery, this alone has been enough to provoke struggle and revolt by workers.24 Being forced to work in dangerous circumstances adds to the alienation associated with having no control over your workplace. This is why Marx’s analyses of exploitation and alienation are germane to the issue of crisis: because they predispose those forced to work for capital to resist and to seek alternatives in ways that can disrupt capitalist planning. 2.1.1.1 Predispositions to Resist Exploitation Exploitation = the extraction of surplus value = the extraction of surplus labor in the production of profitable commodities, i.e., labor over and beyond the labor necessary to reproduce workers’ labor-power. But labor-power = the willingness and ability to work for capital, so capitalists try to confine “necessary labor” to that required for generating that willingness and ability. For workers, their needs and desires are for elaboration of their lives, beyond their employers’ need for labor-power. At subsistence levels of wages (minimal necessary labor) this is obvious, when workers’ needs include better food, clothing, housing, medical services, and more free time for life-beyond-work. But the last of these remains true no matter a worker’s income, no matter one’s place in the 23 24 labor that must be expended in producing the means of subsistence, it increases surplus labor and surplus value, raising the rate of exploitation, s/v, and the rate of profit, s/(c+v). Therefore, as with successful waged struggles against work on the job, successful struggles against the work of producing and repairing labor power also undermine surplus value and amount to resistance to exploitation, even though the effect is indirect. See, especially, his detailing of injuries to workers in Chapter 10, Section 3 of Volume 1 of Capital. This did not change in the period following Marx and Engels’ time. Nick Holdren in his book Injury Impoverished: Workplace Accidents, Capitalism, and Laws in the Progressive Era (Cambridge: Cambridge University Press, 2020), details the struggles of workers injured on the job in the first decades of the twentieth century employed by capitalists unwilling to take responsibility for workers’ injuries. 244 chapter 5 unwaged/waged/salaried income hierarchy. The subordination of life to work defines capitalist domination and everyone who suffers it is deprived of the free time necessary for the flourishing of their life, as individuals and in their social relationships. Except for those we call “workaholics,” individuals who have bought into the capitalist reduction of life to work and can no longer see or imagine life beyond their tools or offices, most workers not only imagine life-beyond-work but also struggle for it, either overtly or covertly, with greater or lesser consciousness of the class forces at work. Thus, the long struggle to shorten the working day (and later the working week, year and life).25 Thus, individuals are predisposed to work less on the job, to withdraw their energy, imagination and creativity from what the boss wants and to apply them instead to meeting their own wants, along with whatever their wage or salary can purchase and their limited free time permits.26 This is especially true because, as Marx recognized in his analysis of reproduction but didn’t study deeply, 25 26 This struggle was partially successful in Marx and Engel’s time, as analyzed in Chapter 10, Section 6, and even more successful later – reducing the average working week to roughly 40 hours for many, creating the weekend, freeing days for annual vacations and winning earlier retirement. Unfortunately, as Juliet Schor documented in her book The Overworked American: The Unexpected Decline of Leisure (1992), published ten years after this essay was first written, during this last period of neoliberalism capitalists have had considerable success on the terrain of absolute surplus value. The imposition of neoliberal policies of union busting, safety deregulation, lowering wages, cutting social services and raising unemployment have put sufficient pressure on workers to force many to accept, even demand, longer working hours. Downward pressure on wages and salaries, combined with a shift by employers to more part-time, precarious jobs, has forced many workers to seek out second jobs – often part-time. Every increase in work time strengthens accumulation and augments absolute surplus value. The heterodox economist Thorstein Veblen (1857−1929) was spot-on when he defined sabotage as “the conscientious withdrawal of efficiency” in On the Nature and Uses of Sabotage (1919) (New York: Oriole Chapbooks, n.d.). Although this was a concept I understood intellectually, it was not until I spent time in the Soviet Union that I observed it in the behavior of virtually everyone I met. Art Linklater may have filmed Slacker (1990) in Austin, Texas, but he could have filmed it anywhere in the USSR at any time before or after 1989 when workers finally brought the regime down. I am not speaking just of those with make-work jobs, through which the Politburo kept everyone employed, such as those of the babushkas sitting in every room of every museum in the country, but of those with jobs that required serious physical or mental labor. Time and again, I saw how little they managed to do and how much time and energy they freed to pursue their own self-valorization, e.g., classical Russian literature for a secretary, personal artwork for professional artist, participation in the Russian orthodox church for a gardener, getting drunk for far too many. Unable to resist openly in that police state, workers’ struggles went underground, where they channeled their creativity into diverse daily practices – all sorts of self-determined activities, including covert but clearly political resistance such as the production of samizdat – twentieth century versions of the subversive anonymous Predispositions to Crisis 245 so-called free time off-the-job is often taken up by the requirements of the job, the unwaged work of reproducing labor-power required to return to the job.27 But the individual, Marx repeatedly insists, is always a social individual, one who is reared and grows up as part of a larger society, so the wants and desires of social individuals – just like their skills and abilities – are shaped by others, those around them. Humans are “social animals.”28 Workers’ imaginations, needs and desires are always social, overlapping and interrelated with those of others and, as a result, give birth to collective struggles against the common experience of exploitation and capital’s domination of their lives. “As the number of the co-operating workers increases, so too does their resistance to the domination of capital.”29 While capitalists learned to draw workers together, to incarcerate them in factories to better tap the power of cooperation by controlling them directly (real subordination), Marx pointed out how such incarceration also resulted in workers recognizing their common lot and organizing together to change it. This has been true not only in factories but wherever workers mass as part of their work, e.g., train depots for railway workers, ports for dockers and sailors, hiring halls for others.30 Echoing early statements in the German Ideology, Marx concludes: “There also grows the revolt of the working class, a class constantly increasing in numbers, and trained, united and organized by the very mechanism of the capitalist process of production . . . the 27 28 29 30 tracts produced by workers in early capitalism. On the latter See, E. P. Thompson, “The Crime of Anonymity,” in Hay, et. al., Albion’s Fatal Tree, 255−344. Because of this, to the degree that workers are predisposed to resist work on the job, so too does it follow that they are also predisposed to resist work for the job done at home or, in anticipation of a future jobs, in schools. Unfortunately, neither Marx nor Engels appear to have either recognized or analyzed such struggles or their implications. Capital, Vol. 1, p. 444, or MECW, Vol. 35, p. 331. Ibid., p. 449, or MECW, Vol. 35, p. 336. The same has been true in schools (edu-factories) and other juvenile detention facilities, where unwaged children have been incarcerated to be trained and disciplined for future jobs. Like waged workers, their common experience – of being conditioned to accept being exploited and alienated – have resulted in collective revolt. Similarly, in prisons for workers who have violated capitalist laws and rehabilitation is defined as accepting to be exploited in a job. Not for nothing did Malcom X call prisons “the universities of the working class” where methods of resistance are learned alongside whatever “job training” is imposed. NB: even though, as I discuss in Chapter 6, workers have succeeded in obtaining laws to restrict capitalists in various ways, few are ever convicted of so-called “white collar” crime and the few that are inevitably wind up in “low security” facilities far different from the hell-hole prisons filled with “blue collar” workers from the lower rungs of the waged hierarchy. 246 chapter 5 socialization of labour reaches a point at which they become incompatible with their capitalist integument.”31 2.1.1.2 Predispositions to Resist Alienation Workers, moreover, are predisposed to rebel not only against the amount of work imposed, the subordination of their lives to work, but also against the kind of work imposed on them. That work, Marx argued most fully in the Manuscripts of 1844 but illustrated repeatedly in Capital, is alienated in four different ways.32 First, workers are alienated from the work imposed on them because they are not acting freely, but doing what their bosses want, the way they are told to do it, producing what those bosses want produced for sale and profit. Second, they are alienated from the products of their labors because capitalists have arranged laws so that they own the products, and the only way workers can get their hands on them is by buying them and the only way for most to be able to legally get the money to buy is to work for some capitalist. So, their own products are wielded as weapons to coerce them into the labor market. Third, they are alienated from each other because their bosses organize their work to pit them against each other – to undermine and stave off collective resistance. Fourth, by being deprived of their individual and collective free activity, they are deprived of what makes them human, their “species being.”33 All these things have been characteristics of the subordination of workers to capitalist control, first formal, then real, as their work has been reorganized to enhance control. 31 32 33 This common experience of the industrial proletariat Marx juxtaposed to the situation of isolated peasants, whose dispersion and differing circumstances weakened their ability to unite as a class in common struggle. “Small holding peasants form a vast mass, the members of which live in similar conditions but without entering into manifold relations with one another. . . the isolation is increased by France’s bad means of communication . . . they do not form a class. They are consequently incapable of enforcing their class interests in their own name.” “The Eighteenth Brumaire of Louis Bonaparte,” MECW, Vol. 11, p. 187. History has shown how important that “bad means of communication” was in limiting peasant abilities to collaborate. Modern means of communication, beginning in the twentieth century, have facilitated the self-organization of French (and other European) peasants to the point where they have been able to collectively resist the kind of enclosure that has virtually wiped-out small farmers in the United States – not only at the national level but also at that of the European Union. See the section on “The Attack on Agricultural Labor” in H. Cleaver, “Food, Famine and International Crisis,” Zerowork #2, 1977, pp. 42−43. See, the section on “Estranged Labor” in the “Manuscripts,” MECW, Vol. 3, pp. 270−279. For both Marx and Hegel, humans were the unique species – homo sapiens – having a will, i.e., being sapient. Today, we know better, although the nature of various species’ sapience may differ. Predispositions to Crisis 247 Although these forms of alienation are structural, in the sense that they are characteristics of how work is organized, Marx did see a relationship between them and workers’ discontent with their jobs. Against such work, he saw them predisposed to resist, to struggle, to rebel. Too much work, and of the wrong kind: that is the quality of the life sentence to hard labor handed out not just by courts but by the capitalist organization of society. These two characteristics of work within capitalism explain why there is a predisposition for those condemned to it to struggle against it. That predisposition is a fundamental source of crisis for capitalists because every reduction in the length or intensity of work reduces absolute surplus value, the rate of exploitation s/v, the rate of profit s/(c + v), and thus the capitalist ability to invest and impose more work, or even the same amount of work, in the future. Work reduction strikes at the heart of the capitalist system.34 2.1.2 Predisposition to Harm from Nature In Chapter 4, I discussed the possibilities for workers, as well as the means of production, to suffer the vagaries of Nature. Unfortunately, how capitalists organize production often makes the impact worse and predisposes workers to more suffering than might otherwise be the case. How? Primarily by prioritizing profitability rather than the well-being of workers, capitalists make choices that increase the likelihood of harm to their employees and other workers. First, in the nineteenth century, the profitability of the textile industry meant a prioritization of the production of fibers over food production. Early examples were the enclosures that Marx describes in Chapter 27 of Capital, Volume 1, which turned local food production into “sheep walks” for wool production. Marx cites, as prototypical, the “clearings” made by the Dutchess of Sutherland in Scotland. “Between 1814 and 1820, these 15,000 inhabitants about 3,000 families were systematically hunted and rooted out.”35 I’ve also mentioned how the diversion of land from the production of food to that of flax contributed to the Great Famine in Ireland. The same choice was made in colonies where the colonizers usurped the best land to produce raw materials for export, e.g., cotton in India destined for British cotton mills, plantation sugar in the West Indies shipped for New England distilleries. As a result, food produced for local consumption on poorer land was more vulnerable to bad weather, with workers suffering the consequences. Under these conditions, 34 35 And, as feminist Marxists have shown, this is also true of work reductions in the sphere of reproduction that subvert the reduction of life to labor-power. K. Marx, Capital, Vol. 1, p. 891-92, or MECW, Vol 35, pp. 719-20. 248 chapter 5 bad weather = lower yields = less food = higher prices = lower real wages = greater malnutrition, susceptibility to disease, and starvation.36 Second, cost-minimization to maximize profits has often made workers more vulnerable to natural phenomena such as floods, storms, fires, and earthquakes because the factories in which they work and the homes in which they live have been cheaply and poorly built. Marx’s research into the reports of government appointed Public Health and Factory inspectors revealed a full awareness of the dangers of leaving both factories and housing to the cost-minimizing practices of capitalists. In the colonies, where there was even less oversight and probably greater corruption due to the lack of colonizer concern with worker well-being, the situation was likely worse.37 The same choice to minimize costs has resulted in harm due to what economists call “negative externalities”, e.g., the pollution of air, land and water, which harms not only employees but all workers. Capitalist lack of concern with dumping wastes into the surrounding environment undermines the health of humans (as well as animals and plants). Capitalist mine owners have had their workers dump mine tailings, willy-nilly, into the surrounding environment, regardless of its negative effect on the miners or people living nearby.38 The mills of Manchester were called “satanic” not only because of the horrible working conditions but also because they operated with steam power. Fueled by coal, the factories produced prodigious quantities of smoke and waste coal ash, polluting both air and water. Engels has some nice, graphic descriptions in this book The Condition of the English Working Class. All these 36 37 38 The modern capitalist tendency in agricultural production to monoculture has increased the vulnerability of crops – both MS and MP - to bad weather. Replacing traditional, ecologically stable practices of growing many varieties of a given crop or breeds of animal with a single variety or the same breed makes production vulnerable to disease or parasites. See, H. Cleaver, “The Contradictions of the Green Revolution,” Monthly Review, Vol. 24, no. 2 (June 1972): 80−111. The same cost minimization has produced what detractors call “factory farms” with very large numbers of enslaved animals herded into tightly packed confinement, such as feedlots for cattle or sheep or cruelly tight cages for individual pigs or chickens instead of allowing these animals to feed on open range. Even in the post-colonial era, the perpetuation of capitalist practices with little effective regulation has produced some of the most devastating consequences, as in the case of the Rama Plaza building in Dhaka, Bangladesh that contained several garment factories. It collapsed in 2013, killing over a thousand workers. With the modern development of strip-mining and mountain top removal to make ore veins accessible to strip-mining equipment, this devastation has become far worse. Patrick McGinley, “From Pick and Shovel to Mountaintop Removal: Environmental Injustice in the Appalachian Coalfields,” Environmental Law 34, no. 1 (Winter 2004): 21−106. Predispositions to Crisis 249 were augmented in the nineteenth century by the absence of industrial regulations to limit both the phenomena and their effects.39 In all this, the vulnerability of workers to natural disasters at home and abroad was increased by 1) the almost universal capitalist effort to hold down wages to bare subsistence to maximize profits and 2) workers being forced to live in and pay rent for barely habitable huts near mines and construction sites and for slum flats in cities. The combination of low wages and miserable living conditions meant a great many workers were chronically malnourished, illclothed, living in ill-heated, over-crowded housing and therefore more susceptible to epidemic and pandemic diseases than they would be if instead they were paid wages that could buy more and better food, clothing, and housing. 2.2 Predispositions to Breakdowns in the Means of Production, MP Most of the means of production are produced, even raw materials extracted from the earth, so their rate of depreciation and waste – integral aspects of their quality – are determined by the production processes of their extraction as well as by their physical nature and how they are handled in transportation from where they are produced to where they are used to produce other commodities. 2.2.1 Due to Workers’ Actions The production of the means of production are as susceptible to breakdown as any other production process. All of the factors mentioned in the previous section can have an impact on the quality of the means of production and thus on the production processes in which they are deployed. Central to my concerns are those actions taken by workers, which undermine the quality of the MP they are producing. Exploited and alienated mine, agricultural or machine workers can sabotage, to a greater or lesser degree, their products, reducing their quality. They can do this in revenge for how they are being exploited, or they may do so to enhance their income. When workers are paid on the basis of piecework, they can sabotage the pieces on the basis of which they are paid. Miners, for instance, when paid by the ton of ore, can mix easier-to-obtain 39 Although in recent decades environmentalists and popular pressure have resulted in government regulators forcing coal-fired plants to take some measures to scrub and reduce their pollution of the air, and the resulting acid rain that kills forests and fish in rivers and streams, the so-called Environmental Protection Agency in the US still refuses to recognize the dangers of coal ash or regulate its disposal. The result has been horrendous for both workers and communities. See, https://www.nrdc.org/stories/coal -ash-hazardous-coal-ash-waste-according-epa-coal-ash-not-hazardous-waste (accessed 7-13-2024). 250 chapter 5 rock with harder-to-obtain ore to increase their tonnage and wage. But doing so reduces the quality of their product. In the case of coal, it decreases the available BTU’s per ton and in the case of other ores, it increases the costs of extracting desired minerals. Similarly, agricultural workers can be careless with cultivation or weeding (decreasing available nutrients and harvest) or with fruits and vegetables (damaging them, reducing their desirability and shelf life).40 Machine operators can intentionally turn out flawed or broken parts. As I have already mentioned, leather, silk or boat building workers produced excess scrap. All such sabotage can increase the rate of depreciation or waste of the means of production, raising the costs of repair and replacement, undermining the profitability of their use. On a large enough scale, defects in MP can disrupt production, even bring it to a halt. Interacting with worker struggles, failures in capitalist organization of production can also diminish the quality and quantity of the means of production being produced. Failure, for example, to mobilize enough labor at harvest time can leave crops rotting in the field, with the result being products of very poor quality – making them hard to process and therefore more costly. One example of poor quality, which Marx cites, was cotton from Surat, India, obtained by the British to replace that made unavailable from the Confederacy during the American Civil War. Surat cotton was of lesser quality partly due to its inherent qualities, e.g., shorter fibers and the unavoidable fragility of thread made from it. But according to reports Marx cites, it also arrived in Britain so filthy that handling it made workers sick and increased the costs of its processing.41 To what degree that quality was due to worker resistance, mishandling, or sabotage is unclear because Marx provides no account of the conditions of either its production or its shipping. In the same passage, however, he does mention the use by textile manufacturers of “unsuitable machinery,” which certainly indicates either incompetence or the inability to afford proper machinery.42 Yet another mixed example from the same period can be found in imported raw silk from China. Already uneven because of variations in the quality of peasant production, as soon as the reeling of silk from cocoons was industrialized 40 41 42 On the fruit farm where I worked in France, how fruits such as peaches and plums were handled was critical because they could only be sold at full value if there were no bruises on peaches and the grey surface dust of plums was intact. The French habit (at that time) of packing and selling fruit in trays where the condition of each piece was clearly visible meant sellers checked the quality of the fruit being picked because buyers did the same during sale. Capital, Vol. 1, pp. 585−6, or MECW, Vol. 35, pp. 459−460. Both reasons could cause small capitalists to be unable to compete, go bankrupt and out of business – hastening the centralization of capital. Predispositions to Crisis 251 and no longer in the hands of those producing them, their producers “paid less attention to the cocoon’s quality” likely causing their quality to decline and making the processing of resulting silk more difficult, raising costs.43 2.2.2 Due to Nature Leaving aside worker struggles and their interactions with capitalist incompetence, in Chapter 4 we saw there are also unforeseeable fluctuations and tendencies in “nature” that can lead to breakdown – especially changes in weather, soil fertility, the richness of mineral deposits and so on. The irregular recurrence of these changes, which make agriculture vulnerable, also predispose it to unplanned crises: It is particularly agricultural products, whose raw materials derive from organic nature, which are the most subject to these fluctuations of value, as a result of variations in the harvest, etc …. The same quantity of labour may here be expressed in very diverse amounts of use-values, depending on uncontrollable natural conditions, the seasons of the year, etc., and a particular quantity of these use-values will accordingly have very different prices.44 Along with variations in the amounts of use-values, so too may uncontrollable variations in weather cause substantial variations in their quality. For example, either too much or two little rain at the wrong time can seriously reduce the quality of many crops, undermining their value as MP and reducing the price at which they can be sold. Given that these kinds of interruptions occur within an expanding system, the natural time constraints of agriculture also cause problems for investors. In the nature of the case, plant and animal products, whose growth and production are subject to certain organic laws involving naturally determined periods of time, cannot suddenly be increased in the same degree as, say, machines and other fixed capital, coal, ore, etc., … It is possible, therefore, and indeed unavoidable when capitalist production is fully developed, that the production and increase of the portion of constant capital that consists of fixed capital, machinery, etc., may run significantly ahead of the portion consisting of organic raw materials, so that 43 44 Ma, “The Modern Silk Road,” 334. Manuscript of 1864−1865, p. 226, Capital, Vol. 3, p. 213, or MECW, Vol. 37, p. 119. 252 chapter 5 the demand for these raw materials grows more rapidly than their supply, and their price therefore rises.45 Such differential ability to expand some elements of MP independently of others causes all the problems discussed above. Marx goes on to note that these tendencies are accentuated during periods of rapid expansion. … the more rapid the accumulation (particularly in times of prosperity), the greater is the relative over-production of machinery and other fixed capital, the more frequent the relative underproduction of vegetable and animal raw materials, and so more marked the previously described rise in their price and the corresponding reaction. The more frequent, therefore, are those revulsions which have their basis in this violent price fluctuation, and are a major element in the reproduction process.46 Again, the natural limits to the rate of expansion of one process can lead to problems of realizing the proper proportion between LP and MP in M – C and thus in … P …. Beyond natural hazards that have always existed in agriculture (or in hunting and gathering for that matter), Marx also noted a tendency within capitalist agriculture that undermines expanded reproduction. Even when it is efficient and management is competent, it separates town and country, concentrating manufacturing and population in cities and reducing the countryside to the production of raw materials, MS or MP. In the process, it disrupts human interaction with nature, e.g., the return of waste to the soil and by so doing it accelerates its impoverishment with negative effects on agricultural productivity. Capitalist production collects the population together in great centers … it disturbs the metabolic interaction between man and the earth, i.e., it prevents the return to the soil of its constituent elements consumed by man in the form of food and clothing; hence it hinders the operation of the eternal natural condition for the lasting fertility of the soil … all progress in capitalist agriculture is a progress in the art, not only of robbing the worker, but of robbing the soil.47 45 46 47 Manuscript of 1864−1865, pp. 226−227, Capital, Vol. 3, p. 213, or MECW, Vol. 37, pp. 119−120. Manuscript of 1864−1865, p. 227, Capital, Vol. 3, p. 214, or MECW, Vol. 37, p. 120. Capital, Vol. 1, Chap. 15, pp. 637−638, or MECW, Vol. 35, pp. 506−507. This was written at a time when the fibers out of which clothing was made were natural, e.g., cotton, linen, wool, and therefore biodegradable. The advent of synthetic fibers has made return to the Predispositions to Crisis 253 Capitalists have counter-argued that their investments in things like fertilizer have enhanced the soil. Even then Marx saw how such investment could make things worse in the long run. all progress in increasing the fertility of the soil for a given time, is a progress toward ruining the more long-lasting sources of that fertility….48 The “more long-lasting” sources derive from the return not only of human waste but also of vegetable matter from plowing under crop residues and barnyard manure – a mixture of animal droppings and straw, what the French call “fumier” – a traditional byproduct on small farms that practice both horticulture and husbandry. Capitalist agribusinesses has replaced such balances with monoculture – in fields and in factory farms – and manure with synthetic chemical fertilizers derived from petroleum (thus no biological material to replenish the soil). Another soil-restoring practice generally abandoned by profit-greedy agribusiness is crop rotation that involves replacing harvestable (and profitable) MS or MP crops in one growing season with some nitrogenfixing crop like clover or alfalfa in the next season.49 48 49 soil impossible. Today, due to regular overproduction on the part of the clothing industry and the short life span of modern “fast fashion,” huge amounts of produced clothing are either never worn and discarded by firms that can’t sell them profitably or worn but quickly discarded because either they are poorly made and wear out quickly or they are replaced by the “latest thing.” The result is that “one garbage truck of textiles is landfilled or incinerated every second.” Landfills are NOT what Marx had in mind by “returning to the soil” – which was the destiny of most clothing throughout human history until capitalism. Most clothing did biodegrade and replenish the soil. See, Ellen MacArthur Foundation, A new textiles economy: Redesigning fashion’s future, 2017. Marx’s concept of a rupture in the metabolism between humans and nature, has recently become central to many Marxists’ thinking about ecological crisis. See, John Foster, “Marx’s theory of metabolic rift,” American Journal of Sociology 105, no. 2 (September 1999): 366−405. Jason Moore, “Transcending the metabolic rift: a theory of crises in the capitalist world-ecology,” The Journal of Peasant Studies 38, no. 1 (January 2011): 1−46, and references therein. Ibid., p. 638, or MECW, Vol. 35, p. 507. Marx here, in a footnote, draws on the work of Justus von Liebig (1803−1873). Today, we know far more about these long-lasting effects, especially the use by capitalist agribusiness of artificial fertilizers derived from petroleum that, unlike traditional manuring and crop rotation, fail to return vegetable matter to the soil, gradually sterilizing it to a mere physical carrier of plants and whatever chemicals are used on them. In the area of Ohio where I grew up, soil was rich and deep – the product of 10,000 years of untrammeled forest growing on a countryside scoured of rock by the glacier of the last ice age. The European settlers who took the land from the indigenous tribes, cut the forests, and created family farms using technologies which replenished the soil. Most raised 254 chapter 5 In Part Six of both the Manuscript of 1864−65 and Capital, Vol. 3, on ground rent, Marx offered further discussion of capitalist progress in “increasing the fertility of the soil” through the introduction of those new technologies associated with the “agricultural revolution” of the time, e.g., investments in drainage, crop rotation, and fertilization. He gave enough importance to this investment and to the declining role of “natural” fertility (fertility that was not the outgrowth of such investment) that he accorded a far lesser role to diminishing returns in agriculture as a source of breakdown than had, for example, Ricardo. The latter saw therein (via rising rent) the source of capitalist decline and the origin of stagnation. All of this allows us to see how Marx saw the occurrence of “natural” catastrophes in production, especially in agricultural production, as only partly exogenous to the system. The causes of disruptions in accumulation have fluctuated as the system has grown and efforts to achieve greater control over nature, have, sometimes, had the contradictory consequence of undermining the fertility of the soil or rendering cultivation more susceptible to disruption. Although farmers have been “selecting” both seeds and breeds long before capitalism, the risks involved in monoculture grew as profit-maximizing capitalist agribusiness has brought more resources to bear on raising the immediate productivity of crops and animals, without regard to long-term consequences.50 As early as his discussion in the Grundrisse, Marx recognized the intrinsic connections between local disruptions and international ones. (For more on the circulation of disruption, see Section 4 below.) This distinction between domestic and foreign, incidentally, is altogether illusory. The relation between the nation which suffers a crop failure and another nation where the former makes purchases is like that between every individual of the nation and the farmer or grain merchant. The surplus sum which it must expend in purchasing grain is a direct subtraction from its capital, from its disposable means.51 50 51 both crops and animals, rotated crops and had a manure spreader, usually a trailer with rotating prongs that flung the manure widely as it was towed across fields. The dangers of monoculture became dramatically apparent in 1970 when the American corn crop was decimated by Southern corn leaf blight. The extent of the damage was due to the widespread use of a single breed of corn, peddled by seed companies but susceptible to the disease. The breed was vulnerable because the seed companies had introduced a detasseling gene to cut production costs – thus its widespread adoption by cost minimizing agribusiness – but one that increased vulnerability to the disease. The seed companies took their profits, while the losses were born by those who bought and planted the seed. Grundrisse, pp. 128−129; MECW, Vol. 28, p. 67. Predispositions to Crisis 255 In the Manuscript of 1864−1865 and in Volume 3 of Capital, in Chapter 6 on “The Effect of Changes in Price,” he analyzed at length the role of agricultural production failures in causing crises both at home and abroad. 2.3 Predispositions to Increasing the Organic Composition of Capital Because defeats on the terrain of absolute surplus value have been recurrent, so too has been the predisposition of capitalists to substitute less troublesome, more productive machinery for workers. When faced with a declining workday and thus less work, value and surplus value, capital has been forced to find some way to redistribute value to itself, that is, from v to s. The substitution of productivity-raising constant fixed capital for labor achieves this result. As early as 1843, Engels recognized this consequence of a capitalist inability to hire enough workers for long enough to generate profits. In the struggle of capital and land against labor, the first two elements enjoy yet another special advantage over labor – the assistance of science, for in present conditions science, too, is directed against labor. Almost all mechanical inventions for instance, have been occasioned by the lack of labour-power; in particular Hargreaves’, Crompton’s and Arkwright’s cotton-spinning machines. There has never been an intense demand for labor which did not result in an invention that increased labor productivity considerably, thus diverting demand away from human labor. The history of England from 1770 until now is a continuous demonstration of this. The last great invention in cotton-spinning, the self-acting mule, was occasioned solely by the demand for labor, and rising wages. It doubled machine-labor, and thereby cut down hand-labor by half; it threw half the workers out of employment, and thereby reduced the wages of the other half; it crushed a plot of the workers against the factory owners, and destroyed the last vestige of strength with which labor had still held out in the unequal struggle against capital.52 Twenty-four years later, Marx described a similar response – albeit on a larger scale – to workers’ success in getting laws passed to shorten the working day. As soon as the gradual upsurge of working class revolt had compelled Parliament compulsorily to shorten the hours of labor, and to begin by imposing a normal working-day on factories properly so called, i.e., from 52 “Outline of a Critique of Political Economy,” MECW, Vol. 3, pp. 442−443. 256 chapter 5 the moment that it was made impossible once and for all to increase the production of surplus value by prolonging the working day, capital threw itself with all its might and in full awareness of the situation, into the production of relative surplus value, by speeding up the development of the machine system.53 For individual capitalists, the introduction of machinery makes it possible for them to increase surplus value and profits in three ways. First, by controlling the speed and rhythm of machines, they can force workers to work more intensely, increasing work, and if there is no compensating increase in v, s will rise, as will s/v and s/(c + v). Second, the higher productivity (product per unit of labor input) of the new machine technology results in products having a lower per unit cost than those of competitors, and hence enables them to sell at a lower price that redistributes surplus value to them, again raising s, reducing v relatively and thus raising s/v and s/(c + v). Third, unless and until they are constrained by struggles, e.g., new legal limits on working hours, the introduction of machines provides an excuse to extend working hours. To avoid the extra costs of starting up, shutting down or having machines stand idle, capitalists try to run them continuously 24 hours a day wherever and whenever possible, with the fewest number of workers, e.g., two 12-hour shifts rather than three 8-hour shifts. As the use of the new technique is generalized, the average per unit value of output declines. Where that output is either MS, or contributes to the production of MS, the result is a decline in the value of labor-power, which can be reproduced with less labor.54 Thus, of the total v + s being extracted from all workers, the capitalists get a relatively higher share; the rate of exploitation, s/v, and the rate of profit s/(c + v) rise for one and all (ceteris paribus). This strategy of substituting machines for labor Marx represents symbolically as a rise in the technical composition of capital: MP/LP – which is not a real ratio, because MP, LP, and their relationships to each other a