A particularly interesting session at the Historical Materialism conference in London on 10-13 November 2011 heard four contributions on Marxist theories of crisis and the current crisis.
These are the abstracts supplied by three of the presenters.
Michel Husson: Towards a chaotic regulation
The period opened up by the crisis is leading to a “chaotic regulation” of the capitalist world economy. There is a kind of regulation, since capitalism does not collapse and continues to operate. But this regulation is chaotic because of a fundamental contradiction: capitalism is trying to return to business as usual but it's impossible. The very causes of the crisis are to be found in the essential features of the pre-crisis configuration and they cannot function any longer.
Three Unsustainable Processes: 1. Chimerica is challenged by the big shift between “old” and “emerging” capitalist countries. The recovery in the U.S. is artificial because it displaces onto the rest of the world the contradictions of the U.S. growth model. 2. Neo-liberal Europe is a truncated construction. The euro was conceived as an instrument of wage discipline, which was bypassed by over-indebtedness. The sovereign debt crisis reveals a tendency to break-up. It can only be stopped by a further degree of integration which is probably out of reach. 3. The fall in the wage share, the rise of inequalities in a context of fiscal austerity render the “equation of realization” insoluble.
Capitalism cannot self-regulate and go back to the “Keynesianism” of the “Golden Age”, its only escape is the deepening of the neoliberal model, but the operational framework of this model has been broken by the crisis. The financial crisis is thus transformed into a systemic crisis of capitalism which affects its very foundations, especially its mode of meeting social needs.
Simon Mohun: Three crises in the long run development of the US economy: similarities and differences
Conventional wisdom on the causes of the crisis of 2007-09 focuses on a background of macroeconomic imbalances, and against this background a search for yield coupled with financial innovation in a financial sector replete with moral hazard and asymmetric innovation. This paper takes a different perspective by focusing on the macroeconomic rate of profit in the US economy.
After considering the difficulties of constructing a long time series, the rate of profit for the economy is depicted from 1980 to 2009. The aim is to use it to construct a long run picture of the ‘laws of motion’ of the US economy. Examination of the US historical record suggests that there are long swings in the macroeconomic rate of profit, and that serious crises are associated with turning points. But not all such turning points are characterized by a falling rate of profit.
The paper explores capital productivity and the profit share in the run-up to the three crises of 1929, 1979 and 2007, and considers their time-series properties. In particular, the paper suggests that most studies do not measure the profit share properly; conventional measures are problematic, and the paper considers how the profit share may be reformulated. A new measure is presented, and the paper concludes with a discussion of what this tells us about how to understand the long run development of the US economy.
Michael Kraetke Capitalism and its crises. Marx' studies of crises from 1847/48 to the 1880s
From 1847/48 onwards, Marx studied all the major crises in the capitalist world economy which he witnessed in much detail. Most of these studies is to be found in hithertoo unpublished notebooks, starting with the London notebooks (1850-53) and continuing until his last notes on the money market and its crises in the 1870s and as late as 1881/82. In Capital as well as in the manuscripts pertaining to Capital, Marx often refers to the crisis events as well as to the various ways in which the experience of cyclical, small and great crises was reflected upon in the economic thought of his time. This is one of the mostly neglected, but highly important, building stones of his own "theory of crisis", originally meant to be the concluding book of the whole "critique of political economy".
• the vast volume of Marx's notebooks devoted to empirical study of the crises of capitalism
• Marx's repeated observation that crisis appears as "a credit phenomenon";
• when writing the Grundrisse, Marx did not not study Hegel, but instead compiled three large notebooks (about 400 printed pages) on the empirical facts of the crisis of 1857/8;
• at the end of 1860s, Marx started studying accountancy, so as better to understand the economic data available;
• after 1879, Marx thought that capitalism had been transformed in important ways;
• in all these voluminious studies on capitalist crises, Marx never mentions the tendency of the rate of profit to fall.