[OPE-L] More on Mandel/Grossman multicausalism

From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Tue Aug 29 2006 - 17:56:42 EDT

While I think of it, I should perhaps add that E. Mandel considered H.
Grossman as "multicausalist" crisis theorist as well. In the text I
mentioned, Mandel writes:

"'Non-monocausal' ones try to elaborate Marx's own dictum according to which
all basic contradictions of the capitalist mode of production come into play
in the process leading to a capitalist crises (Grossman, Mandel)."

I suppose the reason for that interpretation was, that Grossman
distinguished between a basic tendency towards overinvestment in production
capital expressing itself in a falling rate of profit, and a raft of
"modifying countertendencies" to that trend, which he itemises. By the time
you have elaborated the effects or dynamics of all these tendencies, you
have basically covered just about all the main economic contradictions
intrinsic to the capitalist mode of production.

Mandel was rather hesistant about accepting the thesis that the average rate
of profit could fall as a secular trend, be it more slowly and with
fluctuations, also *during* the long boom (how could a capitalist economy
boom, without a rising profit rate?), while the mass of profit increased,
and he was also keenly aware that the growth of the mass of profit was
itself conditional on *market expansion* (both domestically and through
foreign trade - there is an obvious link here to the successes and failures
of imperialist policies). Consequently, a drop in aggregate demand (whether
through bottlenecks, saturated markets, wage cuts, monetary policy or wars
etc.) had immediate repercussions for the growth rate of the mass of profit.

He basically thought - basing himself on sparse statistical evidence, e.g.
Joseph Gillman - that during the long boom, or at least in the early years
of it, average rates of profit must have massively increased (which he
explains partly through technological revolutions, partly through repression
of labour unions, partly through transfers of resources by state policy, and
partly through a surge in aggregate demand).  This contrasts with e.g. Anwar
Shaikh's interpretation, where the average profit rate declines even
*during* the boom, although the mass of profit rises.

Mandel's sprawling and rather unsystematic Phd thesis "Late Capitalism" is
nevertheless "Grossmanite" insofar as it is mainly concerned precisely with
the "modifying countertendencies" that provided the capitalist system with a
new lease of life after world war II. Grossman had set up a kind of
theoretical model, and Mandel sought to verify how that worked out in
historical reality. Mandel was accused by CSE economists of not just being
unsystematic but also for being eclectic, ignoring the centrality of the
tendency of the rate of profit to fall for the "law of accumulation". But
this criticism is rather weak - he tried precisely to identify the main
causes for why profitability was sustained or even increased through the
long boom, and why it would fall nevertheless, so really he was centrally
concerned with the profitability issue.

The main problem with his expose is that, having identified a raft of
"modifying countertendencies" and circumstances influencing profitability,
these variables could be mutually related in all sorts of different ways, as
he himself admits. This raises the objection that a theory should definitely
specify how the variables are (causally and quantitatively) related, and
then test empirically if this is true. But really he was in no position to
test this, both because he lacked the time for substantive empirical
research, and because it would take more research than a person could do in
a lifetime to test all of that in a scientifically acceptable manner.

This invites the accusation that the theory is metaphysical, it explains
everything and nothing - at best, it stated hypotheses about what "could"
explain the dynamics of global capitalist development, but it was more an
interpretation, than a scientifically satisfactory explanation, and this
rich and fertile interpretation could always invoke yet another aspect that
"could" explain the dynamics, for every nuance another nuance was possible.
Whether it really did explain them, remained uncertain, and there is a sense
in which it might describe more than explain (in the sense that the
Armstrong/Glyn/Harrison book is to a large extent descriptive).

Well, the German original of Mandel's Phd thesis was subtitled rather
modestly "Versuch einer Erklarung", i.e. an attempt at an explanation, which
is saying more "this is how you could explain it", i.e. providing a
heuristic theory as a journalist, aware of the complexities of life, might
create from his experience. In this respect it was quite successful
actually, insofar as it inspired many scholars, and put the discussion on a
higher plane, like the works of Arghiri Emmanuel, Klaus Busch, Pierre
Salama, Elmar Alvater and Samir Amin (whatever their faults) did. Maybe that
is all you can achieve in the field of theory. A theory which pretends to
explain "everything" (i.e. is over-extended beyond its proper aegis)
explains nothing.

Personally I don't really think that capitalism functions quite the way that
Mandel says it does - though if you write so much you have to be correct at
least on some points - but that's another story. I think much more attention
should be paid to how a theory is formed in the first instance. The main
thing I am trying to convey here is that Mandel actually tried to apply
Grossman's idea to historical reality, though he dissented from mathematical
"proofs" of capitalist breakdown. This point was missed by most people I've
discussed with on the topic, or that I've read.

Marx one time had this idea that a crisis theory should identify an ideal
movement or sequence of events that would repeat itself more or less at
every level (sectorally, economy-wide, globally) - I'm not quite sure what
he had in mind, but Mandel did attempt to sketch such a thing in his
"Introduction to Capital Vol. 3" (Pelican edition), pp. 48-51. No doubt an
Unoist would argue such an idealised picture could apply only at the level
of a "purely capitalist society"...

Meanwhile, economists are still debating about what exactly caused the Great
Depression of the 1930s, so there you go. Even half a century or a century
afterwards, people might still have good reason to scientifically disagree
about the causes of events that really happened. So maybe there is just not
a lot of meat in "crisis theories".


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