A clarification of Marx's theory of crisis by David Kennedy

David Kennedy on Marxist crisis theory.

Submitted by blebber on February 15, 2010

'Orthodox' Marxist crisis theories have, in neglecting Marxism's philosophical roots, wandered into a cul-de-sac of their own logical empiricist making and are unable to offer, therefore, a viable commentary of contemporary bourgeoisie society. Capitalism is defined by the peculiarity of its form of social relations based upon the dominant mode of surplus extraction - in the form of a surplus of value extracted from waged labour. All entities undergo a definite life-process of genesis, maturity and, finally, decline. The task, therefore, for Marxists is to understand the changing status of the social relations and to empirically bear this out.

It is ironic that a Marxist theory of crisis would seem to
be most relevant and necessary just at the point in history
at which Marxism appears to be at its lowest theoretical
Simon Clarke1

That the epoch in which we live lends itself urgently to a rigorous Marxist
analysis, and that such an analysis is conspicuously absent from the
enquiries of mainstream, contemporary Marxism is, perhaps, self evident.
However, Clarke implies that no 'adequate theory' of crisis exists2. This
implication must be rejected. What follows below is an attempt to clarify
Marx's theory of crisis. It is argued that only by approaching Marx's
theory of capitalist society from a starting point informed with the
significance to Marx's work of it's organicist and Hegelian pedigree can an
understanding of Marx's theory of capitalist crisis hope to be arrived at.
It is suggested that 'orthodox' Marxist crisis theories have, in neglecting
Marxism's philosophical roots, wandered into a cul-de-sac of their own
logical empiricist making and are unable to offer, therefore, a viable
commentary of contemporary bourgeoisie society and the possibilities open
to it.
An attempt will be made to clarify and re-emphasise a Marxist theory of
capitalism in crisis informed by a view of capitalist society as a definite
stage in human social relations - an entity defined by the peculiarity of its
form of social relations based (as with all other societies) upon the
dominant mode of surplus extraction. In the case of capitalism this takes
the form of a surplus of value extracted from waged labour. It is in the
nature of all entities that they undergo a definite life-process of genesis,
maturity and, finally, decline - the latter of which, it is argued, being
capitalism's present moment. The task, therefore, for Marxists is to
understand the changing status of the social relations and to empirically
bear this out.
Such a view, it is recognised, is hardly orthodox in the canon of twentieth
century Marxism. Part of the task of this article is to demonstrate the
validity of such a reading of Marx's work: that Marx (the materialist
dialectician), cannot hope to be comprehended in the logical mis-reading of
his work which has been, and still remains, de rigeur in Marxist circles -
an environment where any notion of viewing the value relation in decline
is dismissed as being insubstantial and, therefore, metaphorical.


The various Marxist theories of crisis which, in turn, have become vogue
within Marxism during the epoch of decline - primarily, disproportionality,
underconsumptionism, and the tendency for the rate of profit to fall - have
all been exhaustively documented, and there will be no laboured detailing
of them here.
Some, in an effort to locate what is essential and relative in each of these
theories, have insisted upon their broader division into, on the one hand,
theories of crisis in the sphere of circulation and, on the other, theories of
crisis in the sphere of consumption.3 It is argued here that, ultimately, all
of these theories are unified in their analysis of crisis - unified, that is, in
their attribution to capital of an abstract logic to its development.
Luxemburg, unwittingly articulating dramatically the shared assumption of
all Capital Logic theories of crisis, scolds the reformist Bernstein thus:
From the standpoint of scientific socialism, the historical
necessity of the socialist revolution manifests itself above
all in the growing anarchy of capitalism which drives the
system into an impasse. But if one admits, with
Bernstein, that capitalist development does not move in
the direction of its own ruin, then socialism ceases to be
objectively necessary.4
Implicit in such statements is a deductive methodology. What seems to be
a dynamic commentary is, on closer inspection, a profoundly abstract,
ahistorical and static analysis - an attempt to explain crisis by way of
projecting Marx's formulaic pronunciations on the phenomenal forms of
crisis onto reality itself, rather than, as with Marx, attempting to explain
those aspects of reality which provide the conditions for crisis in terms of a
changing social relation. This amounts to the elevation of form over
content. Whereas "Marx emphasised the dialectic and made use of logic",5
others have emphasised logic and paid lip-service to the dialectic. In a
general way (without breaking an earlier promise to avoid a detailed
discussion) this Capital Logic problem can be demonstrated.
For much of the epoch of capitalist crisis, Marxist orthodoxy, in analysing
crisis, has centred upon an underconsumptionist critique. Put succinctly, it
is, in the words of its most well-known expositor, Rosa Luxemburg, a
theory where "crises arise from the contradiction between the capacity and
tendency of production to expand and the limited capacity of the markets to
absorb the products".6 The anarchy of the system itself, then, is to blame:
consumption and production pull apart as part of the surplus value created
in production, under the logic of competing capitals, and is ploughed back
into production, expanding it at the expense of consumption. With the
capitalist class unwilling (due to the law to out-compete its competitors) to
take up the slack of an ever increasing surplus, and a working class whose
standard of living does not allow for increased consumption on the scale
required, crisis inevitably occurs. With the mechanics of crisis so simply
stated, the problem, as Clarke states, " becomes not so much that of
explaining the breakdown of capitalism but that of explaining how
capitalism is possible at all ".7
For Luxemburg the solution (albeit an imperfect one) was imperialism,
whereby surplus was dumped off onto regions as yet untainted by
capitalism. For more contemporaneous underconsumptiomsts the shortfall
is taken up by rising real wages and /or rising state expenditure (a 'Marxist'
political economy which gave rise, of course, to a reformist 'Marxist'
political discourse).
The same mechanistic preoccupation with causation can be witnessed in
the 'disproportionality theory'. Despite their heated disputes over the
phenomenal economic forms crises take,8 both underconsumption and
disproportionality theories share the fundamental view that crises are
essentially caused due to the breakdown of the relation between production
and consumption.
For Hilferding this breakdown occurs with the greater interpenetration of
banking and industrial capital - the movement of capital into its stage as
finance capital. Under these conditions there is greater fixity of capital
which leads to the extension of production via economies of scale, but
which also hinders capital's mobility - capital's ability to respond to
disproportionalities (especially that between the 'capital goods' and
'consumer goods' sectors). This creates an inherently unstable society
wherein equilibrium between supply and demand becomes rigid and hence
problematic. Thus the chaotic nature of the system is identified as crises'
fundamental cause:
The enormous inflation of fixed capital means, however,
that once capital has been invested its transfer from one
sphere to another becomes increasingly difficult The
result is that the equalisation of the rate of profit is
possible, increasingly, only through the influx of new
capital into those spheres in which the rate of profit is
above the average, whereas the withdrawal of capital
from those branches which have a large amount of fixed
capital is extremely difficult.9
It can be said that because of his treatment of the law of value as an abstract
category of logic, Hilferding failed to locate the aspects of finance capital in
relation to the developing real contradiction within the form of labour: that
between abstract and concretely useful labour. Hilferding, thus, was
condemned to elevate the growing discrepancy within the economy between
industries/sectors - the form which crisis can take - into the crisis itself.
In recent years, and especially with the growing realisation from the late
1960s that the Keynesian demand management policies which sought to
address such imbalances between production and consumption could do
little to solve the present crisis, explanation of crises has shifted away from
concentration on the breakdown between production and consumption and
toward an explanation based on the tendency for the rate of profit to fall. A
fall in the rate of profit had preceded the present crisis, seemingly causing
it (a fall in the rate of profit having hitherto been thought of as a
consequence of crisis).
After a short-lived vogue of viewing this fall in profit-levels as a result of
rising wages - a distributional interpretation rejected by Marx: "The rate of
profit does not fall because labour becomes less productive, but because it
becomes more productive" 10 - consensus settled around a view of the
falling rate of profit based on the 'rising organic composition of capital'. Its
proponents view crisis as being the result of the 'objective tendencies' of
capitalist accumulation. Much analysis tends, unfortunately, to slip into
mathematical formulae. More still uses Marx's pronouncements on the
subject to lapse into a technological analysis.
The theory states that the organic composition of capital, which occurs with
the displacement of living labour by machinery, rises with this growth of
fixed capital over living labour - the source of value. Despite questions over
the theory's validity, principally over the offsetting of a fall in profitability
through 'countervailing tendencies' such as the cheapening of the contents
of constant capital or an increase in the intensity of exploitation, the theory
is justifiable over the long-run. As Ticktin argues:
[Marx] points out that the logic of the development of
machinery is the total replacement of manpower by
machinery. At that point no value is produced. In other
words, to the extent that capital successfully reproduces
itself it will negate itself through the removal of the
source of value, labour. Put differently, it would appear
that when machines make machines, there will be no
value and hence no profit....such a society would clearly
undergo a crisis.11
Empirically, the validity of a declining rate of profit bears weight: the
United State economy, for example, has over the period from 1945 to 1976,
experienced a 30%-40% decline in the rate of profit, whilst in other
O.E.C.D.countries a 20%-30% decline has been suffered over the same
Again however, the real problem resolves itself, as with the other theories
of crisis previously mentioned, into a logical superimposition of sections of
Marx's work (in this case Volume Three of Capital) onto empirical
phenomena: "Hence, monopoly, labour collectivity, the public sector etc, all
become functional forms which either increase the tendency for the rate of
profit to fall or counteract it or delay it ".13
However, it would be a mistake to underplay the importance of these
phenomenal forms of crisis - Marx certainly did not. In relation to the
disproportion which occurs within the capitalist economy he writes:
All equalisations are accidental and although the
proportion of capital employed in different spheres is
equalised by a continuous process, the continuity of this
process itself presupposed the constant disproportion
which it has continuously, often violently, to even out.14
Or, elsewhere, on the problem of underconsumption:

The conditions . of direct exploitation, and those of
realising it, are not identical. They diverge not only in
time and place, but also logically. The first are only
limited by the productive power of society, the latter by
the proportional relation of the various branches of
production and the consumer power of
society....consumer power based on antagonistic
conditions of distribution, which reduce the consumption
of the bulk of society to a minimum varying within more
or less narrow limits.15
It would be a greater mistake, however, to overstate the explanatory
importance of the phenomenal forms of crisis. Marx was at pains to make
this plain in his Theories of Surplus Value, Volume Two: "These forms
alone do not explain why their crucial aspect becomes prominent and why
the potential contradiction contained in them becomes a real
contradiction".16 "In investigating why the general possibility of crisis
turns into a real crisis, in investigating the conditions of crisis, it is
therefore quite superfluous to concern oneself with the forms of crisis...." n
It is worth, at this point, locating what exactly it is which Marx does
concern himself with in an essential study of capitalist crisis. The
developing contradiction which underlies the crisis is something more
fundamental than that between production and consumption, which lies at
the heart of most orthodox crisis theory. Such phenomenal forms can only
be understood in relation to the source of all contradiction which arises
from the peculiarity of the society in which we live based on the duality of
labour. That is, labour is at once both useful and exchangeable and thus has
both a concrete aspect and (for measurability of value) an abstract aspect.
Their unity, the basis of a stable social relation between capital and labour,
whereby labour fetishes this relation and its phenomena, makes for a viable
surplus labour extracting organism - that is, capitalist society is not
threatened with its negation: communal society. Capitalism, therefore, this
social relation briefly outlined, experiences its many forms of crisis when
the unity of labour, its concrete form and socially supplied abstract form,
pull apart. Large areas of the economy are given over to a purely "useful"
supply of labour independent of its abstract form as fetishism is broken
down under the growing consciousness of labour brought about, in turn, by
its growing socialisation under the auspices of an ever greater division of
labour required for accumulation. Ticktin encapsulates the situation thus:
In its essence it [crisis-D.K.] expresses the fact that the
economic relationships stand in an "absolute
contradiction" with one another. They are pulling apart
instead of interpenetrating. Hence production stands
opposed to consumption, agriculture to industry, labour
power to the means of labour, and sale to purchase. Put
succinctly, value has broken down. Disintegration sets
It is on this very last point of a disintegrating/declining law of value which
we must take issue with what is loosely termed the 'Autonomist' school of
Marxism which has, with its attempt to escape the mechanistic
interpretation of Marx's work already outlined, attained a certain amount of
credibility in this period.

The task in analysing what has become known as Autonomism is to sort
out the wheat from the chaff. In its favour is the obvious disregard for
theory which downplays the role played by the working class in
capitalism's crisis. It points out, rightly, the (at best) 'stage army' view of
the working class, which is trundled out sporadically for its minor role
whilst the 'protagonists', the blind forces of capitalist production, act out
their historical mission. As Geoff Kay points out: "The inevitable outcome
of the degeneration of Marxism to logical-positivism is the objectification
of the working class, and the reduction of its opposition to capital to purely
quantitative struggles (for example, the struggle over wages - D.K.)". Kay
trails off by concluding that "the ultimate failure is to turn away from the
law of value and objectify the forces of production".19

Antonio Negri, the Autonomists' most well known expositor, talks in terms
of capitalism's 'antagonistic character' having its origin in "the relation of
scission between use-value and exchange-value, a relation of scission in
which two tendencies are liberated from the forced unity to which they have
been constrained".20 So far, so good. However, it becomes apparent that in
their haste to get clear of logical-positivism, the Autonomists polarise
themselves at the other extreme, relying on a theory of crisis 'top heavy' in
its subjective content. That is, crisis is caused through overt working class
action which - as we shall now see - is the propellant toward 'death', to use
Negri's words, of the law of value.
To understand the problem we must highlight the Autonomists'
preoccupation with what they see as the fundamental contradiction:
between necessary labour and surplus labour. In this respect Negri's words
are instructive:
Marx's route is that which descends from an adherence to
the monetary image of the crisis to an analysis of the
crisis of social relations, from the crisis of circulation to
the crisis of the relation between necessary labour and
surplus labour And it is in this historical projection
that the crisis becomes a crisis of the law of value.21
For the Autonomists, crisis emanates from advancement in the productive
forces. As science and technology take on greater significance in
production vis-a-vis living labour, the potential develops for the gap
between necessary labour time and surplus labour to increasingly grow. In
other words, less physical labour is required to supply the material needs of
society. However, the possibilities this advance presents are not realisable
as capitalism's primary aim is that of social control through the
imposition of work. "With the growing contradiction between the rising
level of social productivity and capital's continuing insistence on more
work", concludes Harry Cleaver, "working class struggle has more and
more taken on the character of a struggle against work".22 Thus
phenomenal forms of crisis such as that arising out of the tendency of the
organic composition of capital to rise " can be re-read in terms of the
increasing difficulty of imposing work".23
It is this struggle against the 'subordination to work' which underlies the
Autonomists 'scission' between use and exchange value (less work = less
labour = [in its abstract form] less of a measuring rod for capital), and
thereby the crisis of the law of value. Analysis of capitalism and its crises
in terms of an objective unfolding of the laws of that social form is
eschewed in favour of charting the composition and recomposition of the
working class (for example from the 'mass worker' of the 'Fordist' era to the
'social worker' of the 'post-Fordist' present), the working class being seen,
of course, as a class for itself. Thus Cleaver can state:
With the working class understood as being within
capital yet capable of autonomous power crisis can
no longer be thought of as a blind "breakdown1 generated
by the mysterious invisible laws of competition crisis
has been reinterpreted in terms of the power relations
between the classes.24
A true reading of Marx, it is argued, has to reject the Autonomist,
subjectivist argument. Its analysis by-passes the view (consistent with
Marx) of an epoch of decline, and fails to register, in its attack upon the
reification of categories witnessed in 'objectivist' Marxism, the real extent
to which the categories do have an objective life as aspects of capital.25
(Marx writes in the Grundrisse of the part played by capital in its own
destruction thus:
As soon as it begins to sense itself and becomes conscious
of itself as a barrier to development, it seeks refuge in
forms which, by restricting free competition, seem to
make the rule of capital more perfect, but are at the same
time the heralds of its dissolution, and of the dissolution
of the mode of production resting upon it ").26
How, for example, can a theory of crisis based upon the 'concrete
behaviours' of the working class explain the palpable deepening of crisis in
the 1980s and 1990s alongside an equally palpable cessation in an
offensive class struggle? A theory born of the marriage between, on the
one hand, the immediate euphoria of European struggles in the 1960s and
1970s and the (justified) distaste of many on the Marxist left for the
structuralist, anti-humanism of Althusser on the other, Autonomism is, it is
fair to say, a theory inappropriate to the present.
What is needed, therefore, in any investigation of capitalist crisis, is a way
of determining the relationship between both objective and subjective
factors which leaves behind the mechanistic interpretations of the 'capitallogic'
school and the overemphasis upon the struggle of a class 'in itself
characteristic of the Autonomist school. What is needed, in other words, is
a faithful reading of Marx's work - something which, it is argued, can only
be attempted with an understanding of Marx's ontological assumptions.


Marx, unlike many of those contemporaries in political economy he spent
much of his time criticising, was able to both accept and explain the
contradictions which gave rise to crisis. Marx, as Meikle points out, had
this ability because 'he based his understanding on the category of a whole
identity in movement'.27
There is, of course, not enough room here to get to grips fully with what is,
to use Stern's words, ' one of the central disputes of philosophy'28: that
is, the fundamental debate over the structure of the object between those
holding a 'pluralistic' (or atomistic) ontology, and those holding a holistic
(or organic) ontology. However, a brief outline of Marx's pedigree in this
respect is, perhaps, essential to appreciate Marx's understanding of
contradiction (and, of course, the concrete form it takes in capitalist
For Marx, the object (including social phenomena such as a system of
human relations) is - if it is to be made sense of - irreducible. In this,
Marx both demonstrates his Hegelian roots, and his rejection of Kantian
constructivism (upon which, whether conscious of it or not, much
bourgeois political-economic thought rests).29
Taking the latter first, Kant's 'unity' of the object (whatever it may be) is
one which takes place as a result of a 'synthesizing' process by the subject,
whereby more fundamental, self-subsistent and independently existent
elements, are given a mind-imposed identity - in other words, unity is
conferred externally. (Later, it will be drawn out from this point how such
an ontological standpoint insidiously informs many Marxist accounts of
capitalist crisis, treating the system in such a reductionist way that their
analysis lapses into a glorified empiricism rather than a dialectical
understanding of a living organism.)
Following Hegel, Marx rejects any account of the subject which starts out
by giving ontological primacy to the parts which make up that object,
stressing instead their 'indivisible totality1, in which their elemental parts
are subsequent to this totality. As Stern informs us, Hegel is able to reject
the Kantian premise thus: "The object does not need to be organised or
unified by us, because, as the exemplification of a substance-universal it is
no longer treated as reducible to the kind of atomistic manifold that
requires this synthesis'.30 In this account of the object the particular
aspects are not ignored but made sense of as qualities which have meaning
only in relation to the nature of the whole. In short, for both Hegel and
Marx the object as a whole is given ontological primacy.
What, then, is the 'substance-universal' in social terms? If we say, for
instance, that the capitalist social relation is the exemplar of a substanceuniversal
(and thereby lays claim to be treated as an irreducible whole), we
are drawing attention to the fact that capitalist society has an essential
nature which it shares in common with others. The question then becomes:
'what is this essential nature?' Its answer - if one is a Marxist - is that,
essentially, social organisms are class organisms where a surplus of labour
is extracted from one class and appropriated by another. The particular
form in which this process takes place delineates the stages of human
history. Society, then, is for Marx, an irreducible whole - a whole,
moreover, whose totality can only be comprehended in terms of the unity of
the opposing forces of which it is comprised.
The latter aspect is drawn out to good effect by Allen Wood when he states:
An organic whole is essentially made up of
different reciprocally negating processes, which
constitutes the thing the conflicting elements are not
incompatible in the sense that they cannot exist for a time
in the thing. But they are incompatible in the sense that
the opposition between them undermines the stability of
the structure, and eventually destroys it along with the
contradictions which constitute it. The opposing
elements in an organic whole are reciprocally dependent
and cannot exist without one another.31
The 'whole', for Marx, is one which is seen to be in a constant state of
flux. Again, therefore, a question needs to be posited and then answered:
'What is it in capitalist society which represents the restless contradiction
described above?'

In Marx's own words: 'Crisis is the forcible establishment of unity between
elements that have become independent'.32 By this, Marx means that crisis
is a conscious attempt by capital to address the antithesis which arises from
the necessarily dual form of labour supply that is typical under capital, viz.
the concretely useful, and the social form in which surplus labour is
extracted - abstract labour. As Meikle stresses, the fundamental history
(of capitalist society - D.K.) consists in the changes, developments or
adaptations which are made to ease the friction (of these two elements -
D.K.) or to dampen it down when it threatens to burst into flame'.33
The fact that for Marx this is a dialectical contradiction, not conducive to
the static misreadings of these categories made commonplace by those who
followed, can be seen from the words of Marx himself: ' the antithetical
phases of the metamorphoses of the commodity are the developed forms of
motion of this immanent contradiction'.34 From this, it is obvious to
conclude that Marx was talking of a relationship (identified here as the
fundamental source of capitalist crisis) which faces a permanent and
deepening schism. The corollary of this is the ever greater ferocity of the
general forms of crisis (identified earlier in this paper) as the capitalist
class is forced into action in an attempt to bridge the chasm into which it
ultimately must fall.
Following on from what has been said, the natural question to be posed at
this stage is to ask what precisely is causing this friction between use and
exchange value (the dialectic being concerned, firstly, with revealing the
essential contradiction at work in society - that between use value and
exchange value - and, secondly, the uncovering and explanation of its
development: the progressive decaying of exchange value on the one hand,
and the assertion of use value on the other hand).
Crisis, in essence, is the attempt by capital to halt an historical process: the
breakdown of one social relation and its supersession by another, higher
social relation. More specifically, it is an attempt to arrest the transition
between a society where social wealth is measured in terms of exchange
value and a society where social wealth is measured increasingly in terms
of use and need - even if this means the retardation of the forces of
production and the quality of life of the great mass of people in that society.
'Production is only production for capital and not vice-versa' (Marx).35
Marx shows in the Grundrisse where the problem facing capital emanates
from: accumulation is its life blood. The development of the accumulation
process, however, gives rise to the growth of socialised labour, and with it
the criteria of production shifts from exchange to a use value orientation:
'Marx makes abundantly clear what the real dialectical process is: with the
progress in production technique a socialised worker emerges which
increasingly negates his exchange value extreme as abstract labour within
the capitalist integument'.36
The transformation in the supply of labour Marx refers to can best be
appreciated from back-to-back statements, the first from A Contribution to
the Critique of Political Economy, the second from the Grundrisse:
The following basic propositions are essential for an
understanding of the determination of exchange-value by
labour-time. Labour is reduced to simple labour, labour,
so to speak, without any qualitative attributes...To
measure the exchange value of commodities by the labour
time they contain, the different kinds of labour have to be
reduced to uniform, homogeneous simple labour, in
short, to labour of uniform quality, whose only
difference, therefore, is quantity.37
To the degree that large industry develops, the creation of
wealth comes to depend less on labour time and on the
amount of labour employed than on the power of the
agencies set in motion during labour time...Labour no
longer appears so much to be included within the
production process; rather, the human being comes to
relate more as watchman and regulator, to the production
process itself In this transformation, it is neither the
direct human labour 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... labour time ceases
and must cease to be its measure, and hence exchange
value must cease to be the measure of use value.38
In the former, Marx conjures up the scenario of an efficient, mature
capitalist economy where the supply of labour in its abstract form rests
unproblematically with its content, simple human labour - the necessary
social basis of the commodity form. In the latter, Marx is concerned with
conveying the tendency toward the negation of abstract labour - the
'measuring rod' of exchange - as technique and organisational
improvements in the production process leads to the emergence of a
socialised worker capable of forcing concessions from capital it can illafford
to concede. In short, the forcing of the quantitative (accumulation)
brings about, at a certain point, a qualitative change in the social relation.
The progression in the division of labour, destroying craft divisions and
skills, lends itself to the subjective assertion of the working class and so the
pragmatic development by capital of a strategy of control through
concessions to the working class. By the end of the nineteenth century the
organisation of the British working class posed a dangerous alternative to
bourgeois society: a society it looked increasingly upon as having limited
possibilities. The working class could not, if the system were to survive, be
allowed to evolve their socialistic tendencies. Intervention was required,
and intervention came in the forms of: a shift to production on the basis of
need in certain areas of the economy; the withdrawing of whole sectors (or
partial withdrawal) from market discipline; and the negation of exchange
value by use. All of this was done in order to ensure that the enforced
contradiction at the heart of accumulation might continue in however a
deformed manner elsewhere. (This was channelled through and
administered by the reformist tide of institutions and individuals which
swept over the social and political life of the nation from the last quarter of
the nineteenth century - the institutional deflection of independent working
class action). Could this not be what Marx meant when stating that
the capitalists are compelled to exploit the already
gigantic means of production on a larger scale....there is a
corresponding increase in earthquakes, in which the
trading world can only maintain itself by sacrificing part
of wealth, of products and even of productive forces to
the gods of the netherworld - in a word, crises increase?39
Only in this way - by locating the fundamental source of capitalist crisis in
the contradiction between capital and labour, and more specifically, the
ongoing contradiction existing within labour itself - can we view with
clarity the relationship between the objective and subjective elements of
capitalist crisis and dispel theories of it which emphasise the importance of
one to the detriment of the other.
Any theory emphasising the level of conscious action by the working class
in forcing a situation where crisis occurs effectively downplays the part
played by the objective unfolding of the dialectical laws peculiar to
capitalist accumulation identified above. On the other hand, as Kay
The vision of capital running out of momentum and
losing its capacity to survive as capital for lack of
sufficient profit, precisely because of its success in
revolutionising the forces of production (though having -
D.K.) great intellectual appeal cannot yield to any
real understanding of the death crisis of capital as the
birth pangs of a new form of society. It can produce a
breakdown theory, of sorts, but it tells us nothing, and
can tell us nothing, about the class that will make the
Each extreme position, it has been argued, flows from a common inability
to grasp Marx's ontological starting point in relation to human society from
which the dynamic contradiction he identified within capitalist society can
only be understood. Marx's pronouncements on capitalist society (where
the law of value holds sway) lose their incisiveness when law is defined in
terms of regularities rather than as the necessary working out of an
essential contradiction. Crisis here, therefore, must be seen as functional
to the system - a point where capital is (if unchallenged) able to ride out
depressions in trade and continue, 'business as usual', none the worse for
The result of this misreading has been to disassociate capitalist crisis with
the objective decline of capitalist social relations, which in turn, condemns
many Marxists to misread the nature of the present period of capitalist
development. We are living through an era when the life-blood of the
system (abstract labour) continues to haemorrhage at an alarming rate, an
era when capital has begun 'to sense itself and become conscious of itself as
a barrier to development'.41 The encroachment of the state - 'the executive
committee of the bourgeoisie class' as Marx perceptively described it - is a
particular feature of this era of capitalist decline. It is an overseer of
capital's affairs. Decision making concerning the economy shifts from
private capital to capital on a collective basis.42 Other phenomena such as
monopoly, nationalisation, welfarism, the embracing by the state of
bureaucratic trade unionism, and the flight into finance capital keep the
system of wage labour in existence, but only at the terrible cost of curtailing
the law of value in ever larger areas of the economy.
However, these very developments are seen by many Marxists to mark not
the progressive decline of capitalism but, rather, merely its movement from
one form of accumulation to another (even, for some, its exact opposite -
the movement toward a more stable social relation). Machover, for
example, can write:
As the end of the century draws near and we look back at
the epoch from 1900 to the present day, it is clear that
this has been a century of great upheavals and
crises....The late nineteenth and first half of the twentieth
century were indeed a response to a period of historical
crisis of capitalism; but this was a crisis of youth and
growth rather than of senility and of decline.43
(Revealing the depth of his analysis, Machover goes on to pose and answer
the question 'What does a moribund capitalism look like? We shall only be
certain of the answer in retrospect, when capitalism is on its deathbed
history is this kind of science - very good at explaining after the
The same kind of empiricism which infects Machover's Marxism can be
perceived in Negri and the Autonomists in their analysis of capital's
In post-war Europe, which was undergoing
reconstruction, capitalism's excellent health was
interpreted by those believers in the ineluctable
superiority of the 'socialist cause' as a chance mishap, like
the secondary counter tendencies against the downward
trend of the capitalist mode of production. There was no
doubt that capitalism's days were numbered and sooner or
later the economy's inherent and catastrophic
contradictions would emerge. However, capitalism's
growth rate was maintained, the internationalisation of
capital continued unhindered, working class house-holds
increased their standard of living, technological
innovation flourished in short, the productive forces
developed very nicely.45
There has indeed been, within much of contemporary Marxism, a
fetishisation of the ability of capital to expand the forces of production
during the present period, without, it has to be said, addressing whether
such an ability is capable of being fully utilised. As Ticktin points out:
'It is the progress of accumulation that is critical. In
other words, the whole question revolves around the
question of the growth of surplus value. A vibrant
capitalism is able to raise productivity to the limits and
use the surplus value generated to further raise production
and then productivity. To the extent that an increasing
gap opens up between the potential for productive
investment and the reality, capital is malfunctioning.46
We have reached a stage when the forces of production have, to use Marx's
expression, become fettered - not in the sense of the ability to conceive and
construct them, but in the ability to realise the role they have been created
for in capitalism - to facilitate surplus value extraction.
The alarming inability of many Marxists to fully comprehend Marx's
methodological approach to his critique of capitalism shows itself most
starkly in such misunderstandings.

In his book, , Simon Clarke observes that it is 'the
supreme responsibility of socialists' to discover and lay-bare the 'necessary
reasons' of capitalist crisis.47 It can be said that the first step for Marxists
wishing to fulfil this responsibility is to familiarise themselves with Marx's
theoretical pedigree - more specifically, the input into Marx's work of both
the organicist and Hegelian traditions which gives Marxism its explanatory
dynamism, distinguishing Marx's critique of capitalism from all others.
A failure to begin our journey with Marx's methodology to gain our
bearings can only result in travelling down the usual intellectual cul-de-sac
of viewing capitalist crisis in terms of something which is functional to the
capitalist system. Typical of this view are the words of Mandel: the
development of the capitalist mode of production is marked by 'periods of
equilibrium and disequilibrium, each of the two elements engendering its
own negation. Each equilibrium inevitably leads to a disequilibrium, and
after a certain period of time this, in turn, makes possible a new provisional
equilibrium'.48 As Meikle points out, though, 'Crises do not occur in order
that the self-expansion of capital can start up again. They are, as Marx
treats them, crises of the society, not cycles in an economic mechanism'.49
The real basis of Marx's theory of crisis lies, it has been argued here, in the
contradictory nature of the value relations, or, more accurately, the
realisation of the contradiction (an ever more antagonistic contradiction)
between the unity of concrete human labour and its social form, abstract
labour. Crisis theory, to be meaningful, must be harnessed to the
dialectical account of this growing contradiction - in doing so, the dynamic
view Marx had of capitalist development, in terms of an entity with a
definite life-process, becomes essential.
Writing in 1929, Henryk Grossman identified the reason for Marxism's
production of 'unsatisfactory literature' on the subject of 'economic
breakdown' as having methodological roots: Marxism had turned to
empiricism and away from theory.50 Sadly, it seems that little in the
intervening years has changed within Marxism. As we move into a period
where the complexities of capital's crisis and decline give ever more
contradictory signals to its commentators, the need to re-establish
Marxism's theoretical foundations becomes a crucial task.

1 Simon Clarke, , p74, London, 1994.
2 The source of this 'inadequacy', for Clarke, being that: 'Nowhere in his own works does Marx
present a systematic and thoroughly worked out exposition of a theory of crisis' - ibid, p5
3 See M. Itoh, Value and Crisis, London 1980, pl 19 and A. Negri , Marx beyond Marx, Mass.
1984, p96.
4 Quoted by S. Clarke, op-cit, p94.
5 P. Kennedy, unpublished paper on Grossman's crisis theory, Glasgow, 1994.
6 Quoted by S. Clarke, op cit., p31
7 Ibid p54.
8 Hilferding writes, for example, "The term underconsumptionism has no sense in economics".
Underconsumptionism is "impossible to conceive if production is carried out in the right
proportions". For Hilferding, then, underconsumption is subsumed within a disproportionality
theory of crisis. See S. Clarke, op cit., p39.
9 Quoted by S. Clarke, op cit., p40
10 Quoted by A.Callinicos, Karl Marx, London, 1983, p134
11 H. Ticktin, Critique 26, p172.
12 F. Mosely, Capital and Class 48, p115
13P. Kennedy, op cit
14K. Marx, Theories of Surplus Value, 2 London 1969, p492.
15 Quoted by E. Mandel, Late Capitalism, London 1993, p28.
16 K. Marx, op. cit, p152
17 Ibid, p514
18 H. Ticktin, op cit, p74.
19 G. Kay, Critique 6, p74.
20 A. Negri, op cit, p72.
21 Ibid, p25
22 H. Cleaver, Reading Capital Politically, Brighton 1979, p83.
23 H. Cleaver, Radical Chains 4, p13
24H. Cleaver, Reading Capital Politically, p62.
25 Aufheben 3, pages 33-34.
26 K. Marx, Grundrisse, London, 1973, p651.
27 S. Meikle, Essentialism in the thought of Karl Marx London 1985, p66.
28 R. Stern, Hegel, Kant and the Structure of the Object, London 1990, p5.
29 Ibid. (The passages on this dual assertion are an extremely concise outline of the argument put
forward in R. Stern's book and are certainly not meant to be seen as an original contribution on my
part - D.K.).
30 Ibid, p5.
31 Quoted in S. Meikle, op. cit, p66.
32 Quoted by S. Meikle, op. cit, p67.
33 S. Meikle, op. cit, p67.
34 Quoted by S. Meikle, op. cit, p118
35 Quoted by P. Kennedy, op. cit.
36 P. Kennedy, op. cit
37 K. Marx, A Contribution to the Critique of Political economy, Moscow, 1979, p30.
38 K. Marx, Grundrisse, p704.
39 K. Marx and F. Engels, Selected Works, London, 1977, p228.
40 G. Kay, op. cit, p74.
41 K. Marx, Grundrisse, p651.
42 H. Ticktin, Critique 26, p80.
43 M. Machover, Critique 23, p148 & 151.
44 Ibid, p147.
45 A. Negri. The politics of Subversion, Cambridge 1989, p10.
46 H. Ticktin, Critique 26, p79.
47 S. Clarke, op. cit, p73.
48 E. Mandel, op. cit, p26.
49 S. Meikle, op. cit, p66.
50 Quoted by P. Kennedy, op-cit.

MOSCOW, 1979.
LONDON, 1985.
LONDON, 1990.




13 years 2 months ago

In reply to by libcom.org

Submitted by Steven. on May 19, 2011

Does anyone have contact details for David Kennedy? Someone has contacted libcom asking for permission to translate this into Turkish.