From a Marxist perspective
Disproportionality was a popular crisis theory among Marxists of the Second International era that preceded World War I — from Engels’ death in 1895 to 1914. It is less popular among Marxists today, at least judging from the Internet, where the seemingly incompatible “not enough” surplus value or “too much” surplus value/underconsumptionist theories are fighting it out.
The capitalist mode of production and, indeed, all economic systems involve not only production but reproduction. What is the difference between production and reproduction? Let’s take any factory — for example, a garment shop that specializes in belt production. In order to produce the belts, the boss — industrial capitalist — needs workers, a building, raw materials in the form of leather, electricity to run the shop’s machines and provide lighting, and so on. The industrial capitalist then must combine these forces of production to produce the belts. This is an example of production.
Among Marxists today, the tendency of the rate of profit to fall is perhaps the most popular explanation for capitalism’s cyclical economic crises, with underconsumption a distant second. In its more naive forms, this theory leaves out the question of realizing surplus value altogether.
We can’t help it! Donald John Trump is again the chief of world imperialism. Is Trump a good representative of the U.S. capitalist ruling class? He is not only a capitalist but also a large landowner.
Given that the primary focus of this blog is economics, it is essential to address both of Trump’s roles.
The Trump Organization, his main enterprise, appropriates surplus value by buying land in Manhattan (New York City) and other large urban areas. It hires construction companies to erect skyscrapers that increase in height in alignment with the continually escalating urban ground rents. As these rents climb, the Trump family gets richer.
The basic formula of capitalist production is M—C…P…C’—M’. (1) Industrial capitalists begin with a sum of money M. They must then find on the market the elements of productive capital — both constant capital (factory buildings, machinery, and raw and auxiliary materials) and variable capital (labor power), the only commodity that produces surplus value. The productive capital, both constant and variable, is represented by C.
Chapter 1: Modern Underconsumption Theories
The first underconsumptionist theories were put forward by pre-Marxist bourgeois economists such as Sismondi and Malthus. As trade unions developed, these theories gained considerable support among their members and supporters.
The Debate Among the (Bourgeois) Economists About the Possibility of a General Glut of Commodities
Even before the first general capitalist crisis hit the world market in 1825, a debate occurred among the political economists on whether or not a general glut of commodities was possible. On one side were J.B. Say, James Mill (father of John Stuart Mill), and David Ricardo; on the other side were Simondi de Sismondi and Thomas Robert Malthus
For weeks following Israel’s murder of Hamas leader Ismail Haniyeh in Tehran on July 31, the world wondered if (and when) Iran would retaliate. Haniyeh was heavily involved in diplomatic activity to end Israel’s genocidal bombing in Gaza. He had been in Tehran for the inauguration of Iran’s new president, Masoud Pezehkian.
Iran was widely expected to react by launching a drone and missile counterattack on Israel as in April, but this time to causing greater damage. Much to the surprise of most observers, Iran took no military action. It seems that the Iranian leaders were engaged in intense diplomatic activity to arrange a ceasefire to end, or at least suspend, Israel’s genocidal bombing campaign on Gaza.
Hezbollah, the Lebanese political-religious resistance organization, was also negotiating for a ceasefire. Its leader, Hassan Nasrallah, was one of the most popular and respected political leaders in Lebanon.
Sam Williams
March 1, 2015
This book is based on my blog Critique of Crisis Theory. The blog is focused on one question of Marxist economic theory: What are the causes of periodic economic crises such as the one that occurred in 2007-09 that have marked the concrete history of the world capitalist economy since 1825?
The blog and this book are built on the foundations of Capital, which, during the panic in 2008, became a bestseller once again. However, that work itself, though it lays the foundation, is not about the periodic crises capitalist production goes through. Nor is there a section within it dealing with crises as such.
Since Marx and Engels put so much emphasis on crises in the Communist Manifesto and other works, this omission seems surprising. However, according to Marx’s original plan, Capital was to be only one of a series of books he intended to write on economics. According to this plan, Marx would crown his economic work with a book on the world market, the state, competition, and crises. However, Marx did not have the time to produce this work.
Editor’s Note
In 2010, a project was announced to compile the main posts into a PDF eBook.
By 2015, an update on the eBook’s status indicated that the first draft had been completed, with 37 chapters organized into seven sections, a general introduction, and individual introductions for each section. The update suggested that the project was expected to be finalized within the following year, 2016.
However, as is often the case, unforeseen circumstances delayed the project until now.
The second draft of the eBook, building upon the 2015 first draft, has been finalized and is currently being prepared for publication.
In the coming weeks, we will share the completed chapters on this blog between our regular postings.