A critical review of David Graeber's Debt

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Angelus Novus
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Jun 12 2012 10:31
A critical review of David Graeber's Debt

"Graeber does not recognize what money and credit mean in pre-capitalist societies, what distinguishes them from each other. He works with trans-historical phenomena, without raising questions as to their historical-social form. This is a trait he shares with the economic mainstream that he otherwise criticizes. Graeber writes that systems of credit and accounting are as old as civilization itself. He admits that he finds it difficult to distinguish between gift-giving and credit; but this is only a problem if one discusses these forms of social intercourse independent from their respective dominant forms of production, when one does not clarify exactly what is characteristic of capitalism, what makes it capitalistic and thus what distinguishes it from other social formations."

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Joseph Kay
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Jun 12 2012 11:36

Good review. The worry with criticising a book by a non-Marxist for not talking about class struggle and modes of production is that it's kinda a given, but I think this manages to avoid banality by pointing out what's at stake in these concepts (i.e. the actual social relations prevailing today against which any revolution erupts).

Graeber doesn't ignore the capital-wage labour relation but argues free wage labour has always been a minority of labour in capitalism. There's some truth to that, but the power of Marx's analysis isn't in saying 'everyone is a wage labourer' but grasping the internal logic of capitalism which is fully compatible with formal freedom, even where it integrates circuits of bonded-labour, slavery etc. Graeber doesn't really have an answer for why capitalism is so relentlessly productive compared to previous social formations, whereas Marx does (i.e. money functioning as capital is not transhistorical money, but something historically specific, as the review points out).

The way I see it people reading Debt with no background in Marx will take the focus on the debtor-creditor relation as a nice populist basis for 99%ism and see Graeber's periodisation as basically cyclical, which supports the view that finance has got a bit out of control and society just needs a bit of regulatory tinkering (hence good reviews from the bourgeois press). The appeal of the jubilee proposal is in this vein. Aside from the fact debts are written off all the time (it's called bankruptcy, or an Individual Voluntary Arrangement), all the debt-based revolts Graeber cites seem to have been demanding the restoration of the status quo ante, not radical social change (with the exception of the German Peasants War, omnia sunt comunia and all that).

On the other hand, I think if you've got a background in Marx there's lots of use. The historical and anthropological critique of the barter myth is a good corollary to Marx's logical critique of the myth of Robinson Crusoe and his good English book-keeping habits. And I think when Marxists reject economic reductionism, there's plenty in the book about forms of social relations which aren't reducible to economics (which I think is an excellent counter to stuff like ParEcon, which agonises over how to measure everyone's efforts and sacrifices and reward them accordingly).*

I think Graeber had a more subversive intent than simply 99%ism. To be fair he doesn't just focus on the state, but repeatedly sees the state and market as arising together and requiring each other (inviting a critique of both). And he also seems to be trying to reintroduce 'communism' to an American audience, not as something foreign and dangerous but something wholesome and everyday. The question is whether that works. Will people take away a critique of both markets and states, or simply calls for jubillee? Does defining communism as mutual aid neuter it as class antagonism?

* Oddly, isn't Graeber a signatory of the new 'ParEconist International' thing? (Edit: yes). Seems to run counter to the anti-economistic arguments in Debt, which talk about how quantifying/monetising social obligations destroys social bonds.

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georgestapleton
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Jun 12 2012 14:49

Amusingly this article has been shared by Alex Callincos on his facebook page.

Imagine if the SWP got into value theory. (Actually China Mieville's book on international law is suposedly very pashukanis-ist.)

Also, I like the review but agree with Joseph's comments.

So this is probably true: "He works with trans-historical phenomena, without raising questions as to their historical-social form. This is a trait he shares with the economic mainstream that he otherwise criticizes." But it is also true of much marxist theory. And Stützle's call for historicization, one i agree with, is not one that is heard by most value theorist. There is a complete lack of serious historical work on the development of social forms. The sole exception to this being the work by Heide Gerstenberger and (possibly Kurz in the the Black book, but that's not translated yet so I don't know.)

So you have sentences like this: "Under pre-capitalist relations, in which production was conducted to meet needs, credit was a means of impoverishment."

Credit was a means of impoverishment! That's a big statement, and I have no idea what he means. I'm a total financial history nerd and it sounds a bit off to me.

And when he points us to good history of the development of social forms, he points us to a political marxist, polanyi and a 'new historian' (i.e. kind of a Foucauldian) - no person from his tradition is included. (And I'd say Graeber is as much of a Marxist as Polanyi!)

When I was in Berlin we spoke about political marxism's relation with value theory. And although both of us think that there is a big undeveloped convergence there, it's worth noting that the leading political marxist working on finance/credit etc (Sam Knafo) is pretty against value theory. (See his Political Marxism and Value Theory.) So it is interesting to see yet another value theory person go to Political Marxism for their historical work. This is certainly better than when I spoke to Anselm Jappe about the nature of pre-capitalist money and asked him for some historical work to read on it and he couldn't recommend any other than Marx's historical writings on the topic.

So doubly thanks for this translation because I'm ordering that LeGoff book now and will probably read it over the weekend.

Angelus Novus
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Jun 12 2012 15:53
georgestapleton wrote:
When I was in Berlin we spoke about political marxism's relation with value theory. And although both of us think that there is a big undeveloped convergence there, it's worth noting that the leading political marxist working on finance/credit etc (Sam Knafo) is pretty against value theory. (See his Political Marxism and Value Theory.)

I'm totally convinced that Political Marxism and value theory are like unwitting cousins. In Charlie Post's _American Road to Capitalism_, he says he prefers the term "Capital-centric Marxist".

I also see a lot of convergence with Daniel Bensaid's Marx For Our Times, and he was neither a Political Marxist nor a value-form guy, so I'm curious as to what influenced him in this regard (other than the fact that French Trotskyists all seem to be really heavy into the Frankfurt School).

Angelus Novus
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Jun 12 2012 15:54

P.S. I mentioned on Hektor Rottweiler's blog that I'd love to do an online reading group of the Gerstenberger book. Anyone up for that?!

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Khawaga
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Jun 12 2012 16:06

When would you start reading? I'm up for it, just not right away.

Angelus Novus
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Jun 12 2012 16:43
Khawaga wrote:
When would you start reading? I'm up for it, just not right away.

Autumn? Hektor says he'd be able to start in October.

Angelus Novus
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Jun 12 2012 17:07
georgestapleton wrote:
I'm a total financial history nerd

Can you recommend a good list of titles? (Yeah, I know you probably mentioned some during your Berlin visit, but I didn't write any down)

Hektor Rotweiler
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Jun 12 2012 17:17

I agree with Angelus about value theory and political marxism. It's all about the relationship between the material and the ideal maaan. Can anyone recommend works other than the Gerstenberger and the Bensaid that attempt to work out some sort of relationship between the two?

I read the Knafo sometime ago. As an IR scholar I can understand his stress on empirical capitals. But I don't understand why he can be dismissive of value form theory and retain a long and abiding interest in Lacan.

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Jun 12 2012 17:29
Angelus Novus wrote:
P.S. I mentioned on Hektor Rottweiler's blog that I'd love to do an online reading group of the Gerstenberger book. Anyone up for that?!

ocelot, AndrewF and me are doing a real world reading group of Gerstenberger, although we are reading Anderson's Lineages of the Absolutist State first. We'll probably start Gerstenberger in July or that so I could probably participate online in October.

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Jun 12 2012 17:43

Same here regarding Gerstenberger (do you mean Impersonal Power?).

Angelus Novus, thanks a lot for the translation! I first read it in German on IS's blog and thought, oh, this would be a good text to translate!

On credit as a means of impoverishment, Michael Heinrich mentions this in this or this video, but similarly without any further details.

Also thanks everyone for the discussion on the possible convergences between political marxism and value theory. I'm very much attracted to both (although predominantly focusing on the latter right now, for school-related reasons) but never actually thought about their relationship. Could someone post Knafo's "Political Marxism and Value Theory: Bridging the Gap between Theory and History"? I don't have access to HM archives.

Hektor Rotweiler
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Jun 12 2012 18:24

Yes, Impersonal Power.

Knafo is here:

mediafire dot com/?42vjbqbj6ej9bvz

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Jun 12 2012 19:32

October is good for me unless we somehow manage, in our wildest dreams, to have spread the social strike from Quebec to Ontario by then.

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Jun 12 2012 20:02

David Graeber's Twitter responses to the review (via the author):

https://twitter.com/istuetzle/status/212527422904598528

Angelus Novus
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Jun 12 2012 20:31
knotwho wrote:
David Graeber's Twitter responses to the review (via the author):

https://twitter.com/istuetzle/status/212527422904598528

Yeah, Graeber misses the point. Ingo was making a point about the specificity of social forms, and in particular relations of production, whereas Graeber assumes he's being criticized merely for not mentioning things like the existence of social class.

andy g
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Jun 12 2012 20:45

jura

i have access to HM archive if you still need that article

posi
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Jun 12 2012 22:03
AN wrote:
Yeah, Graeber misses the point. Ingo was making a point about the specificity of social forms, and in particular relations of production, whereas Graeber assumes he's being criticized merely for not mentioning things like the existence of social class.

If you look at his whole twitter feed, I think his response is stronger than that. Captured by: "I say this especially because he gives _no_ reason why the distinctions he proposes imply _any_ distinction in practice . . . how would saying "credit is not the same as debt in a capitalist system" actually effect any of my other arguments in any way?"

I haven't read Graeber's book, but when I got to the end of the review that was my feeling as well. It all sounds very serious, but if you're going to make an argument about the importance of historical specificity, then you need to be able to specify what historic differences, exactly, are in question, and why they matter. I don't see the review doing that. There's just this single sentence:

"Under pre-capitalist relations, in which production was conducted to meet needs, credit was a means of impoverishment. In contrast, under capitalism, credit is a means of augmenting money – of profit maximization. "

OK, fine - but what follows from this? Based on other reviews of Graeber's book, my impression is that these two roles of credit are amply described by Graeber, and that he says that credit has different functions at different times. No?

I also suspect, based on a fairly sketchy understanding of the topic, that this distinction might be too bald. In the sense in which credit was a means of impoverishment in early civilisation, that is also one of its functions today. Even more obviously, lending money for profit was also a phenomenon in pre-capitalist society. The point about pre-capitalist relations of production is not that there is no profit motive (for which there is evidence in mercantile accounting documents going back to 5000BC or so), it's that the profit motive doesn't overwhelmingly determine, across society as a whole, decisions about prices, production, etc.

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Jun 13 2012 14:50
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if you're going to make an argument about the importance of historical specificity, then you need to be able to specify what historic differences, exactly, are in question, and why they matter.

In fairness posi, I agree with you, and make the same point in my comments above. But, it is a book review not a book so I think pointing to the need for historical specificity is fair enough.

The problem is that value theorists too often insist on the the historical specificity of a phenomenon but don't show that the phenomenon did not previously exist. (Actually this is a problem generally on the left - see the endless claims about debt and the unending nature of the current crisis - we'll never have growth again, blah, blah, blah.)

And I have difficulty understanding the difference between a 'distinction in theory' and a 'distinction in practice' in practice that Graeber proposes. I get the question okay but 'why does this matter' - and here I think it is pretty clear. Stuezle is objecting to this:

Quote:
According to Graeber, every revolution begins with debt that society can no longer repay. “Cancel the debts and redistribute the land.” This sentence by the historian of antiquity Moses Finley is the only revolutionary program, recurring throughout the centuries. And most revolutions were preceded by (excessive) debt.

Because if this is true then revolutions are a historically recurring phenomenon as opposed to historical determinate phenomenon. And that does matter for how we understand revolutions and revolutionary activity.

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Jun 13 2012 14:51

But yeah posi I agree with what you are saying and I haven't read Graeber (although I've read a few reviews) so I don't know if Stuetzle's big point is fair or accurate.

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Jun 13 2012 15:00

And as I said, we don't have a decent value theoretic account of the emergence of money that we can point to. And that is needed if value theory is to be taken seriously.

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Jun 13 2012 15:43

I read the article by Knafo today. What do people think about it? To be honest I thought it was mostly utter BS.

Hektor Rotweiler
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Jun 13 2012 16:34

I haven't read it for years, but apart from remembering being fascinated by a few comments, that sounds about right.

I did a bit of trawling on the web last night for articles that tried to link value theory with political Marxism and came across some stuff by Guido Starosta. Has anyone read his stuff? His article on Lukacs was good but the other stuff I skimmed, while generally solid, seems to be based on a perverse need to argue that value theory has an inverted view of abstract labour. This leads him to argue that fusing substantialism and formalism somehow renders his theory political. So like Knafo it seems that his strategy for linking value theory with political marxism is to argue for some sort of deficiency in value theory and introduce some sort of amendment that links it to the realm of empirical politics.

(He's also the one who has made statements that abstract labour can be measured in calories. This led to some good responses from Arthur and Bonefeld.)

Does anyone know if Banaji has written anything on the subject? I'd imagine it would be good.

Android
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Jun 13 2012 16:58
Hektor RotWeiler wrote:
Does anyone know if Banaji has written anything on the subject? I'd imagine it would be good.

The only thing that I have across from Banaji in this ballpark was his text from the late 1970s, 'From the Commodity to Capital: The Hegelian Dialectic in Marx's Capital'. Which was published in Value: Representation of Labour in Capitalism, edited by Diane Elson. I have not read the text itself so can't comment on how relevant it is to linking political marxism and value theory. Other then I have seen it referenced in quite a few more contemporary texts.

Also, according to his university page he is working on a new book, provisionally entitled Marx's Theory and Contemporary Capitalism - which is a bit vague although it might cover some of the issues being discussed.

Hektor Rotweiler
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Jun 13 2012 17:40

Thanks Android,

I tried reading that Banaji article. Couldn't wrap my head around it. But its why i hoped he may have written something on this issue. The new book sounds good.

It also seems I misremembered. Although Bonefeld and Arthur respond to G.Carchedi and G.Starosta on abstract labour, it is G. Carchedi that discusses Abstract labour and calories.

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Jun 13 2012 18:37

I think Banaji's article from Elson's collection is very good as far as reflections on Marx's method are concerned. It is perhaps the only paper in English that I've read that details the "circular" nature of Marx's exposition (i.e. from appearances to essences to appearances reconceptualized based on the knowledge of essence). IIRC he calls this the "curves" in Marx's exposition. Thus he correctly identifies the beginning of Capital as (simple) circulation, which is followed by an anlysis of production to return to circulation (as the circulation of industrial capital) in Vol. 2. Moreover, this analysis is firmly grounded (pun intended) in the Hegelian category of "ground".

I've read Starosta's critique of Rubin. Maybe I'm confusing him with someone else but I think he was arguing for a physiological interpretation of abstract labor. On the one hand, this distinguishes him from just about everyone else today, on the other hand, it is not a distinction to be proud of...

posi
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Jun 13 2012 20:19
georgestapleton wrote:
And I have difficulty understanding the difference between a 'distinction in theory' and a 'distinction in practice' in practice that Graeber proposes.

Well, if I am the only right handed person in the room, and the only person with a hat, then 'the person in the room with the hat' and 'the right handed person in the room' are theoretically different, but practically the same.

That would be how I'd see it: the different term doesn't pick out any distinct set of facts.

georgestapleton wrote:
I get the question okay but 'why does this matter' - and here I think it is pretty clear. Stuezle is objecting to this:
Quote:
According to Graeber, every revolution begins with debt that society can no longer repay. “Cancel the debts and redistribute the land.” This sentence by the historian of antiquity Moses Finley is the only revolutionary program, recurring throughout the centuries. And most revolutions were preceded by (excessive) debt.

But in the passage you quote here, the author agrees with Graeber, so it can hardly be the basis of a critique. There is a critique in the following sentences, but its claim is simply that Graeber doesn't share Stutzle's semantic analysis of capitalism. It might be more than semantic, but because Stutzle never establishes - at least credibly - what the real differences between the categories are, and why they matter, the assertion by itself is totally bite-free.

The reviewer also seems to think that there's a conflict between money being a form of credit and being a universal equivalent: I don't see why it can't be both. Based on my - admittedly limited - understanding of how money gets created it really is a form of credit. Not been on the Marx for a while, so maybe I'm missing something. But to me the review feels very declamatory and assertive, but also insubstantial.

georgestapleton wrote:
Because if this is true then revolutions are a historically recurring phenomenon as opposed to historical determinate phenomenon. And that does matter for how we understand revolutions and revolutionary activity.

Things can be both determinate and recurring. e.g. the earth rotating. Furthermore, the claim about there being a single recurring revolutionary programme is totally different from the question of whether revolutions happen on a recurring basis - they might very well keep happening on the basis of differing programmes. Which, now I think about it, contra the assertion in the review, is obviously the case.

Also, why on earth is someone who's being all I R SRS MARXIST endorsing a description of a revolutionary programme wholly orientated around debt and land FFS (and which is transplanted from 'antiquity', i.e. not capitalism, to capitalism which is supposedly what he is criticising Graeber for doing)?! Are there any other factors of production we might like to consider, perhaps?

PS ALSO. I have re-read the bit in the Grundrisse which Stützle quotes and it seems to me he's taking it out of context. The point of the passage is to make the distinction between lending capacity which is sufficiently universal, liquid, and powerful to facilitate a genuine competitive, society-wide money market (which he calls credit), and a few people lending a little bit here and there (which he doesn't).

He isn't hanging a big point about 'credit' or 'debt' off this passage, he's saying that historically capitalism requires a certain level of financialisation to establish the universal equivalence/value form that we all know and <3 - and he's bringing in the term 'credit' to explain that (distinguished from 'usury'). It's a semantic distinction which has a particular value for making a particular point. So when the reviewer then goes on to say:

Quote:
What does Marx mean by that? Under pre-capitalist relations, in which production was conducted to meet needs, credit was a means of impoverishment. In contrast, under capitalism, credit is a means of augmenting money – of profit maximization

... I'm gonna say he is mis-reading the passage and gets 0 beardy Marxist points.

Angelus Novus
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Jun 13 2012 23:04
posi wrote:
But in the passage you quote here, the author agrees with Graeber, so it can hardly be the basis of a critique.

No. That you think so is due to an ambiguity involved in translating conjunctive tense in German into English.

Ingo in the original writes: "Dieser Satz des Althistorikers Moses Finley sei das einzige und über die Jahrhunderte immer wiederkehrende revolutionäre Programm."

The word in bold, "sei", is a form of "is" used to indicate that Ingo is giving Graeber's position. If Ingo were giving his own position, or agreeing with Graeber, he would use "ist" instead of "sei".

Usually I deal with this by using phrases like "according to..." or "supposedly", but since the paragraph begins with "according to Graeber" (even in the original), I assumed it was already clear, and thought it would read awkward to just pile on multiple "according to"s.

Sorry for diverting from the substantive discussion, I just thought it was important to note this.

david graeber
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Jun 13 2012 23:57

I missed the point at first because I hadn't realized just how far off the criticism actually was.

Let me summarize what I wrote on another blog on the subject, since typing it all out a second time will be kind of exhausting.

In the book I wrote what I thought was a friendly challenge to Marxist theory – I said, basically, that we are used to writing as if

a) capitalism is based on the relation of production between free wage laborer and the owner of capital
b) the form and meaning of capitalist money emerges from this relation
c) therefore it is inappropriate to assume any important continuity with earlier, pre-capitalist (that is pre-wage labor) forms of money

In response I threw out an historical observation: that, surprisingly, almost all the key financial innovations which became typical of capitalism, from stock exchanges to national deficit financing through semi-private central banking systems, to various forms of commercial credit, developed not only before the factory system, but before wage labor was in any way dominant, or really all that significant, as a factor in production for the market. I also observed that free wage labor was never as commonplace as many seem to assume even in Victorian England, let alone in the world system as a whole at that time, and cited Yann Moulier-Boutang’s arguments that there has never been a time when it was the predominant global form. Finally I pointed out this didn’t really contradict Marx’s analysis since he was writing not a work of political economy but a critique of political economy, that is, assuming the somewhat utopian assumptions of the political economists were true and showing that even if they were, the capitalist mode of production would still destroy itself based on fundamental contradictions.

I expected this might spark a certain debate.

I didn’t expect agreement . But I did expect some engagement. There are lots of potential explanations one can offer, after all. One could argue (a la Brenner) that wage labor was more common in the 16th and 17th centuries than we usually think. Or maybe one could argue as does Jairus Banaji that wage labor is not primarily a matter of free contract at all but of paying the means for workers’ reproduction out of a firm’s income, in such a way that even slaves could be wage labor in a sense. Or one could conclude as I do that free wage labor simply isn’t as central to capitalism as we’d previously assumed. But I did expect some engagement.

What do I get instead? Stutzle completely ignores the entire argument, acts as if I never even addressed Marx and Marxist categories, and simply reasserts the common orthodox view - assumptions (a), (b) and (c) above - as if I was simply ignorant of them or was incapable of conceiving them.

Why? I have no idea. I assume he did read the passages in question. He could have addressed them in some way. But instead he just intentionally pretended they weren't there.

Why do people write reviews like this? I mean, what would be so hard about addressing the arguments I actually do make. I'm sure there are plenty of devastating criticisms one could offer of them. But it seems profoundly dishonest simply to ignore what I have to say about wage labor and then lecture me on the monetary significance of wage labor as if I had not even thought about the subject.

Angelus Novus
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Jun 14 2012 00:10

David,

Ingo's review appeared in Analyse & Kritik, a general audience (i.e. "popular") leftist newspaper. As such, a book review has to be brief.

To compensate for this brevity, Ingo also added a Appendix to the review on his website, where he goes a little bit more into depth.

When I get around to translating that, perhaps the nature of his critique might be clearer.

However, I should not that it trying to cast Ingo as some sort of standard bearer of Marxist orthodoxy, you are way, way off the mark.

There's a Wikipedia entry that, while not particularly in depth, does give something of an outline of the theoretical heterodoxy he represents: Neue Marx Lektüre.

The closest thing I know in the English-speaking world would be the Open Marxism school in Scotland/England.

david graeber
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Jun 14 2012 00:14

Oh yeah and for what it's worth I never say anything remotely like that "every revolution begins with debt that society can no longer repay." I do say that debt seems to me the most common reason for revolts and insurrections in world history (rather than different than revolutions by most definitions) and do indeed quote Moses Finley, who said not that there is only one revolutionary program in history (cancel debts and redistribute the land) but that this was the only revolutionary program in the ancient Mediterranean. I didn't even say he was right, but I thought it at least showed such concerns were extremely common.

This is just one of any number of examples where Stultze completely misrepresents my actual stated position.

It's tiresome to write these responses. It puts you in a quandary. Generally speaking I just don't write responses to reviews when the bulk of the response would have to consist of clarifications of what I actually said. It's a damned-if-you-do damned-if-you-don't sort of situation. If you do reply, you always sound intemperate and people insult you personally and call you an asshole for seeming so impatient with being misquoted or misrepresented (as has happened to me several times already with this very review.) If you don't respond, there will dozens of people out there in the world thinking you did actually believe whatever idiotic thing the reviewer ascribed to you. I'm still trying to figure out which is better.

david graeber
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Jun 14 2012 00:17

I think people are confused about my use of the term "orthodoxy" here.

I am not trying to characterize his position in general. I am using it to describe the specific position he takes on the relation of free wage labor and capitalist money forms. I challenge this one particular piece of Marxist orthodoxy. He aggressively defends it. That is all.