Re: [OPE-L] Grossman and the theory of capitalist collapse

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Fri Jun 29 2007 - 21:03:31 EDT


>Thanks Jurriaan.. I found the quote, but as you say not the source yet.
>

cite is given footnote 156 on p. 268 of Rick's biography. It seems
that Rick has quoted Juegen Scheele quoting from a file of
unpublished manuscripts by Grossman. My sense is the quote is from
1932.



>Paul B.
>
>----- Original Message -----
>From: <mailto:adsl675281@TISCALI.NL>Jurriaan Bendien
>To: <mailto:OPE-L@SUS.CSUCHICO.EDU>OPE-L@SUS.CSUCHICO.EDU
>Sent: Tuesday, June 26, 2007 8:51 PM
>Subject: [OPE-L] Grossman and the theory of capitalist collapse
>
>The source is
><http://www.marxists.org/archive/grossman/>http://www.marxists.org/archive/grossman/ where
>it's printed as a caption quote in grey, at the top of the page.
>However, the source of the caption is not stated. I cannot yet trace
>the source in Grossman's published texts. Presumably the comment was
>made after 1929. I suggest you consult Rick Kuhn.
>
>However Grossman is wrong in stating that Hilferding or Bauer
>believed a breakdown was "impossible". They had, after all, observed
>the ravages of world war I and its aftermath. The question was more
>one of a conjunctural type: how likely was a deep slump in the given
>circumstances? What would be its magnitude? What were the political
>implications?
>
>The notion of a breakdown is however somewhat ambiguous itself,
>because what is a real "breakdown" (Zusammenbruch)? Grossman aims to
>show that after N number of cycles, insufficient surplus value is
>generated to valorise the mass of capital assets, the rate of profit
>falls, and eventually the system collapses. But supposing that he is
>right, what prevents a mutation of the system in a way which
>revalues assets, changes allocative principles and changes property
>rights? You may possibly be able to demonstrate a necessary
>long-term trend in capital structures, but an economic collapse does
>not logically follow from it.
>
>During the great depression, production and circulation never
>"collapsed" totally, even with seriously debased currency (my
>grandfather once gave me an old banknote of a million Reichsmarks,
>claiming that at a certain point it would have taken a barrowful of
>these notes to buy groceries, and that people therefore bartered
>instead). Between summer 1929 and early 1932, German unemployment
>rose from just under 1.3 million to 6 million. The unemployment rate
>rose from 4.5% to 24% of the labour force. Real GDP declined
>absolutely by 8.3 percent from early 1931, average real weekly wages
>declined 2.5% per year until mid-1935. (Nicholas H. Dimsdale,
>Nicholas Horsewood and Arthur van Riel, "Unemployment and real wages
>in Weimar Germany". Uni of Oxford Discussion Papers in Economics and
>Social History, no. 56, 2004). That was depression, not collapse. I
>thumbnail-sketched the impact and recovery from world war 2 here:
><http://en.wikipedia.org/wiki/Capital_accumulation#Capital_accumulation_and_military_wars>http://en.wikipedia.org/wiki/Capital_accumulation#Capital_accumulation_and_military_wars
>
>I think that you can find real examples of the collapse of societies
>in history, where people literally died like flies from lack of food
>and water, but few collapses are absolute, in the sense that a
>social order totally disintegrates. As soon as the normal trading
>pattern becomes impossible, and one's life is at stake, prevailing
>property relations are no longer respected, and people seize
>whatever they need to survive, or barter.
>
>When I lived in New Zealand in 1985, the Labour Government began to
>apply neoliberal shock therapy, ripping up all protectionist
>measures, eradicating most subsidies, and staging a privatisation
>sell-out. At that time, I and my friends thought the avalanche of
>events would inaugur a pre-revolutionary political crisis. That did
>not happen with the given qualities of consciousness; the most that
>happened, other than business failures, rising unemployment and some
>feeble protest, was that the net outward emigration flow for some
>years was proportionally similar to East Germany after the Wende,
>and that the Labour Party eventually split, after masses of workers
>had already voted with their feet. The maximum permitted inflation
>rate was fixed by legal statute. All this excitement taught me, that
>the anxiety of collapse was not wellfounded, and that a theory of
>collapse would actually have to specify what a collapse would
>consist in.
>
>There exists a literature on collapsing societies, both historical
>(Joseph Tainter, Jared Diamond etc.) and contemporary (e.g. with
>regard to the "transitional economies" of the ex-Soviet Bloc,
>Argentina, Zimbabwe etc.) but it is mostly not a Marxist literature.
>I think that when Marxists raise the spectre of collapse, they ought
>to base themselves on real facts and not rhetoric. A general
>collapse of capitalism through economic dislocations is very
>unlikely, at most you can say that the social order in particular
>countries or regions can collapse for mainly economic reasons.
>Perhaps a better perspective is that of Mike Davis, who portrays in
>various ways the gradual "rotting" of the foundations of traditional
>bourgeois society, in terms of what this means for human relations
>and the people who no longer fit easily in these relations, and how
>unanticipated events can spell disaster (the great influenza
>pandemic of 1918 killed more people than the world war did!).
>
>As a digression, more realistic than the spectre of collapse, is the
>spectre of wars, which Mr Bush focuses upon a lot, with a military
>mind-set. Generally people fight wars because they think they can
>win something by them, or to defend what they think is rightfully
>theirs or claim as theirs. But what if you can effectively do
>neither, in important respects? You can still have a conflict in
>some way, obviously, but it begins to take very different forms.
>I noted cyber wars; there are also resource wars and guerilla wars
>of various kinds. But, for example, controlling access to a resource
>is only useful, if you can utilise it or make money from that
>resource - if you cannot do that for technical, political or
>financial reasons, the resource isn't worth much to anybody. All
>that is achieved, is that some are prevented from access by others.
>
>I would expect that in future, the wars will be more and more
>oriented to issues about the *access to resources of any kind*,
>calling into question the ownership relations, enclosures and
>barriers pertaining to those resources. As I've argued before, I
>think the globalisation of the world begets the "ghettoisation" of
>the world, not necessarily spatially.  "Criminality" is a relative
>concept, insofar as what is not illegal, is not a crime, although it
>may be morally objectionable, and obviously there are many more ways
>to stir (or cause trouble) in the moral cauldron of humanity even
>although those ways are not strictly illegal and bypass the law
>makers. At issue there, is the self-regulation of people versus the
>regulation by an external authority, ultimately the meaning of
>freedom. The problem here is that markets by themselves cannot
>balance this out. And indeed the modern social/cultural debate is
>very much about human "behaviour" as such, the limits of what can be
>tolerated, and how you can impose sanctions against behaviour deemed
>anti-social. Grist to the mill for the genuine socialist concerned
>with the potential for human emancipation from the conditions that
>oppress them.
>
>Jurriaan


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