10. Rebuilding the Theory of Crisis as a Postcolonial Task

See Karl Marx, Class Struggles in France, 1850, Selected Works, Volume 1 (Moscow: Progress Publishers, 1969)—https://​www.​marxists.​org/​archive/​marx/​works/​1850/​class-struggles-france/​ and Frederick Engels, Revolution and Counter Revolution in Germany, Chapter 19, “The Close of the Insurrection”, 23 October 1852—https://​www.​marxists.​org/​archive/​marx/​works/​1852/​germany/​ch19.​htm (accessed on 21 December 2016).

V.I. Lenin, The Impending Catastrophe and How to Combat It (September 10–14, 1917), Lenin Collected Works (Moscow: Progress Publishers, 1977), Volume 25, pp. 323–369.

Karl Marx, Theories of Surplus Value, 1858–62 (Moscow: Progress Publishers, n.d.), Chapter 17, “Ricardo’s Theory of Accumulation and a Critique of It (The Very Nature of capital Leads to Crises)”,—https://​www.​marxists.​org/​archive/​marx/​works/​1863/​theories-surplus-value/​ch17.​htm (accessed on 29 January 2017); contemporary economists still repeat the old idea of Malthus, exposed by Marx in Theories of Surplus Value, of the so-called positive role of the unlimited growth of consumption as a means to fight economic crises. Unproductive consumption brought forth possibilities of war, such as increased armaments orders and wasted capital, and in the final reckoning it led to war itself. It could not, however, avert the economic crises of overproduction. Related to this, see also Chapter 20 (section 3 (b), “An Inquiry into Those Principles…” [The Lack of Understanding of the Contradictions of the capitalist Mode of Production Which Cause Crises]”—https://​www.​marxists.​org/​archive/​marx/​works/​1863/​theories-surplus-value/​ch20.​htm (accessed on 26 February 2017).

Marx wrote, “a falling rate profit (may correspond) to a rising or falling rate of surplus value, and a constant rate of profit to a rising or falling rate of surplus value. And we have seen in that a rising, falling, or a rate of profit that remains the same can also correspond to a rising or falling rate of surplus-value… The rate of profit is thus determined by two major factors—the rate of surplus-value and the value-composition of capital. The effects of these two factors may be briefly summed up as follows, and we are able now to express the composition in percentages, since it is immaterial here in which of the two portions of the capital the change originates. The rates of profit of two different capitals, or of one and the same capital in two successive different conditions, are equal: (1) given the same percentage composition and the same rate of surplus-value; (2) given unequal percentage compositions and unequal rates of surplus-value, if the (mathematical) product of the rate of surplus-value and the percentages of the variable part of capital (s′ and v) is the same in each case, i.e., if the mass of surplus-value reckoned as a percentage of the total capital (s = s′v); in other words, when the factors s′ and v stand in inverse proportion to one another in the two cases. They are unequal: (1) given the same percentage composition, if the rates of surplus-value are unequal, in which case they stand in the same ratio as these rates of surplus-value; (2) given the same rate of surplus-value and different percentage composition, in which case they stand in the same ratio as the variable portions of the capitals; (3) given different rates of surplus-value and different percentage compositions, in which case they stand in the same proportion as the products s′v, i.e., as the masses of surplus-value reckoned as a percentage of total capital.”—Capital, Volume 3, The Process of Capitalist Production as a Whole, ed. Friedrich Engels, (1894), trans. David Fernbach (London: Penguin, 1991), Chapter 3, pp. 161–162. In other words, crisis thus remains organic to economy more because of the uncertainties in the parallel trajectories of the rate of surplus value and rate of profit, with the mutating organic composition of capital ever unsettling any possibility of fit.

“The Crisis as the Manifestation of All the Contradictions of Bourgeois Economy’, in Karl Marx, Theories of Surplus Value, Chapter 17, Section 10, “Ricardo’s Theory of Accumulation and a Critique of it. (The Very Nature of Capital Leads to Crises)’, Theories of Surplus Value—https://​www.​marxists.​org/​archive/​marx/​works/​1863/​theories-surplus-value/​ch17.​htm (accessed 26 December 2016).

Roman Rosdolsky thought that Marx’s argument of the law of the tendency of the rate of profit to fall was “in every respect the most important law of modern political economy… despite its simplicity, it has never before been grasped and even less consciously articulated… It is from the historical standpoint the most important law.”—The Making of Marx’s Capital, (1968), trans. Pete Burgess (London: Pluto Press, 1977), p. 381. This is because, as Marx said, the real barrier of capitalist production is capital itself (Capital, Volume 3, Chapter 15), and thus the law was linked to the entire range of questions concerning the mode of production, development of productive forces, existence of various social classes, etc.

On this see David Kennedy, “A Clarification of Marx’s Theory of Crisis”—https://​libcom.​org/​library/​clarification-marxs-theory-crisis-david-kennedy (accessed on 6 January 2017).

On post war debates among the academic Marxists in the West on Marx’s ideas on crisis and the relative validity of various explanations, such as, under-consumption, falling rate of profit, realisation crisis, over-accumulation with respect to labour power, competition and the anarchy of the market, production and consumption disproportionality, market competition and monopoly profit, finally credit and regulation of accumulation, see Simon Clarke, “The Marxist Theory of Overaccumulation and Crisis”, Science and Society, Volume 54 (4), Winter 1990–91, pp. 442–467, and for the following debate, Judith Orr, “Making a Comeback: The Marxist Theory of Crisis”, International Socialism, 79, Summer 1998. This chapter does not go into these debates are they are not relevant for a postcolonial framing of the question.

The Japanese Marxist Samezo Kuruma wrote as early as 1929, “As long as political economy retains its bourgeois perspective, however, it will be incapable of moving forward to thoroughly understand the problem of crisis. We can in fact see that the outbreak of crisis, in the proper sense of the term, was a turning point in terms of political economy ceasing to exist as a science. Crisis, in its particular sense, is the collective explosion of all of the contradictions of capitalist production, and as such the outbreak of crisis, from two directions, necessarily brought bourgeois political economy as a science to an end. First, by actually thrusting upon political economy a new problem that was unanswerable from the bourgeois perspective—i.e. a problem that could only be answered by elucidating the contradictions of capitalist production—crisis exposed in the clearest manner possible the fundamental defect of bourgeois political economy: the class-based limitations of its cognition. Second, the appearance of crisis threw out on the streets immense numbers of wageworkers, who had been gathered from every direction during the preceding period of prosperity, thereby revealing the anti-social figure of capitalist production in the most vivid manner and stimulating the class consciousness of the proletariat, so that the elucidation of the internal connections of capitalist production, which had been a weapon in the hands of the bourgeoisie, became a weapon to be wielded by the proletariat.”—“An Introduction to the Study of Crisis”, Journal of the Ohara Institute for Social Research, Volume 6 (1), September 1929—https://​www.​marxists.​org/​archive/​kuruma/​crisis-intro.​htm (accessed on 25 January 2017).

Samezo Kuruma noted many years ago that all through his expositions on crisis Marx had analysed the global entanglement of crisis. For instance he remarked that Marx had written, “The commercial crises of the nineteenth century, and in particular the great crises of 1825 and 1836 [were] big storms on the world market, in which the antagonism of all elements in the bourgeois process of production exploded.” (A Contribution to the Critique of Political Economy); then “The world trade crises must be regarded as the real concentration and forcible adjustment of all the contradictions of bourgeois economy.” (Theories of Surplus Value); and then “In world market crises, all the contradictions of bourgeois production erupt collectively; in particular crises (particular in their content and in extent) the eruptions are only sporadically, isolated and one-sided.” (Theories of Surplus Value)—Samezo Kuruma, “An Overview of Marx’s Theory of Crisis”, Journal of the Ohara Institute for Social Research, August 1936—https://​www.​marxists.​org/​archive/​kuruma/​crisis-overview.​htm(accessed on 25 January 2017).

Marx wrote, “It is quite simply the private ownership of land, mines, water, etc. by certain people, which enables them to snatch, intercept and seize the excess surplus-value over and above profit (average profit, the rate of profit determined by the general rate of profit) contained in the commodities of these particular spheres of production, these particular fields of capital investment, and so to prevent it from entering into the general process by which the general rate of profit is formed. Moreover, some of this surplus-value is actually collected in every industrial enterprise, since rent for the land used (by factory buildings, workhouses etc.) figures in every instance, for even where the land is available free, no factories are built, except in the more or less populated areas with good means of communication.”—Theories of Surplus Value, Chapter 8, Section 3 (c)—https://www.marxists.org/archive/marx/works/1863/theories-surplus-value/ch08.htm#s3c (accessed on 25 January 2017); he also pointed out there, “Interest and rent, which anticipate surplus-value, presuppose that the general character of reproduction will remain the same. And this is the case as long as the capitalist mode of production continues. Secondly, it is presupposed moreover that the specific relations of this mode of production remain the same during a certain period, and this is in fact also more or less the case. Thus the result of production crystallizes into a permanent and therefore prerequisite condition of production, that is, it becomes a permanent attribute of the material conditions of production. It is crises that put an end to this apparent independence of the various elements of which the production process continually consists and which it continually reproduces.”—Ibid.

See in particular the famous section, “The Banks and their New Roles” in V.I. Lenin, Imperialism, The Highest Stage of Capitalism in Lenin Selected Works, Volume 1 (Moscow: Progress Publishers, 1963), pp. 210–225—https://​www.​marxists.​org/​archive/​lenin/​works/​1916/​imp-hsc/​ch02.​htm (accessed on 29 January 2017). He wrote further, “It is characteristic of capitalism in general that the ownership of capital is separated from the application of capital to production, that money capital is separated from industrial or productive capital, and that the rentier who lives entirely on income obtained from money capital is separated from the entrepreneur and from all who are directly concerned in the management of capital. Imperialism, or the domination of finance capital, is that highest stage of capitalism in which this separation reaches vast proportions. The supremacy of finance capital over all other forms of capital means the predominance of the rentier and of the financial oligarchy…”—https://​www.​marxists.​org/​archive/​lenin/​works/​1916/​imp-hsc/​ch03.​htm (accessed on 29 January 2017).

Thus, after the financial meltdown in 2008, when the US banks were in trouble, they had Henry Paulson write a three-page piece of legislation within days granting them $750 billion. When Congress rejected this outrageous giveaway, after a struggle among the banks, a small number of them emerged stronger than before the crisis. Goldman Sachs, JPMorgan Chase—all of whom had got government coverage—made billions of profits, seven times higher in 2009 than a year previously. Meanwhile, home foreclosures went up; more workers lived in their cars and were pushed into homeless shelters.—http://​www.​workers.​org/​2009/​us/​banks_​1029/​ (accessed on 17 January 2017).

Frederick Engels, Anti-Duhring: Herr Eugen Duhring’s Revolution in Science, 1878—p. 196 https://​www.​marxists.​org/​archive/​marx/​works/​download/​Engels_​Anti_​Duhring.​pdf (accessed on 31 January 2017).

One of the most lucid and informative expositions on this is Andrzej Walicki, The Controversy over Capitalism: Studies in the Social Philosophy of the Russian Populists (Oxford: Oxford University Press, 1969), Section 3 (4), “Populism and Marxism”, pp. 132–194; See also on the engagement of Marxism with Populism, Teodor Shanin (ed.), Late Marx and the Russian Road: Marx and the Peripheries of Capitalism (London: Routledge and Kegan Paul, 1983). According to Walicki, Shanin’s representation of the populists was inadequate, and did not do full justice to the full range of Populist writings. See “Preface” to The Controversy over Capitalism: Studies in the Social Philosophy of the Russian Populists, p. xii.

V.I. Lenin, The Collapse of the Second International, 1915, Lenin Collected Works (Moscow: Progress Publishers, 1974, Volume 21: pp. 205–259), Section 3, p. 226.

V.I. Lenin, The Economic Content of Narodism and the Criticism of It in Mr. Struve’s Book,1984–95, Lenin Collected Works (Moscow: Progress Publishers, 1974, Volume 1: pp. 333–508), pp. 507–508.

One of the detailed discussions on Chernyshevskii’s novel and its history in Russian political-revolutionary thought is Andrew M. Drozd, Chernyshevskii’s What is to be Done? A Reevaluation (Evanston, Illinois: Northwestern University Press, 2001).

As the war clouds gathered over Europe, Lenin began focusing on crisis; see, “The Meaning of the Crisis”, 1911, Lenin Collected Works, Volume 17 (Moscow: Progress Publishers, 1974), pp 168–172. In 1914 he wrote, “The European war is a tremendous historical crisis, the beginning of a new epoch. Like any crisis, the war has aggravated deep-seated antagonisms and brought them to the surface, tearing asunder all veils of hypocrisy, rejecting all conventions and deflating all corrupt or rotting authorities. (This, incidentally, is the salutary and progressive effect of all crises, which only the dull-witted adherents of ‘peaceful evolution’ fail to realise.)”—“Dead Chauvinism and Living Socialism—How the International Can be Restored”, Lenin Collected Works, Volume 21 (Moscow: Progress Publishers, 1974, pp. 94–101), p. 98; among Lenin’s other war year writings on crisis, “The Defeat of Russia and the Revolutionary Crisis”, 1915, Lenin Collected Works (Moscow: Progress Publishers, 1974), Volume 21, pp. 378–382; “Three Crises”, July 1917, Lenin Collected Works (Moscow: Progress Publishers, 1977), Volume 25, pp. 171–175; and “The Crisis Has Matured”, October 1917, Lenin Collected Works (Moscow: Progress Publishers, 1972), Volume 22, pp. 74–85.

V.I. Lenin, “The Crisis Has Matured”-https://​www.​marxists.​org/​archive/​lenin/​works/​1917/​oct/​20.​htm (accessed on 21 January 2017).

On this see the discussion, Kevin Anderson, Lenin, Hegel, and Western Marxism: A Critical Study (Chicago: University of Illinois Press, 1995), particularly Chapter 1, “The Crisis of World Marxism in 1914 and Lenin’s Plunge into Hegel”, pp. 3–27.

V.I. Lenin, The Collapse of the Second International, 1915, Lenin Collected Works, Volume 28 (Moscow: Progress Publishers, 1974, pp. 205–259), p. 214.

This is an important point. Agrarian crisis was almost forgotten by the crisis theorists of the West. Or the entire question was subsumed under antiquarian interest in Marx turning in his late years to Russia, or Lenin pointing out the importance of the peasant question in 1911–12, or the idea of a “peasant mode of production”. Only few theorists from postcolonial countries, dubbed as “Maoist theorists”, such as Amit Bhaduri or Samir Amin, kept on pointing out the significance of agrarian crisis in the broader crisis of capitalism. Among the new crop of writings, see T.J. Jacob, “Farmers’ Issues: Class Struggles under Neocolonial Relations of Production”, Frontier, Volume 49 (28), 15–21 January 2017—http://www.frontierweekly.com/articles/vol-49/49-28/49-28-Class%20Struggle.html#sthash.QdDQAdWh.dpuf (accessed on 30 January 2017); see also P. Lawrence, (ed.), 1986, World Recession and the Food Crisis in Africa (London: James Currey, 1986), and D. Nabudere, The Political Economy of Imperialism, (London: Zed Press, 1978).

On the role of the idea of justice, Etienne Balibar, Sandro Mezzadra and Ranabir Samaddar (eds.) The Borders of Justice (Philadelphia: Temple University Press, 2013).

Bjorn Beckman, “The Postcolonial State: Crisis and Reconstruction”, Institute of Development Studies Bulletin, Sussex, Volume 19 (4: pp. 26–34), p. 32; R. Sandbrook, The Politics of Africa's Economic Stagnation(Cambridge: Cambridge University Press, 1985).

In this regard, the history of South Africa seems to be decisive; see, Susan Booysen, The African National Congress and the Regeneration of Political Power (Johannesburg: Wits University Press, 2011); Anthony Butler, The Idea of the ANC (Athens: Ohio University Press, 2013); and Jonathan Ball. Arianna Lissoni, Jon Soske, Natasha Erlank, Noor Nieftagodien and Omar Badsha (eds.), One Hundred Years of the ANC: Debating Liberation Histories Today (Johannesburg: Wits University Press, 2012).

Interview given to Francesco Raparelli, “Reinventing Communist Politics”, Rome Conference on Communism (18–22 January 2017), Viewpoint Magazine, 18 January 2017—https://​viewpointmag.​com/​2017/​01/​18/​reinventing-communist-politics/​ (accessed on 30 January 2017).

Interview given to Chiara Giorgi, “The Communist Desire to Change the World—And Ourselves”, Rome Conference on Communism (18–22 January 2017) Viewpoint Magazine, 18 January 2017—https://​viewpointmag.​com/​2017/​01/​18/​the-communist-desire-to-change-the-world-and-ourselves/​ (accessed on 30 January 2017).

Lenin Collected Works, Volume 33 (Moscow: Progress Publishers, 1965), pp. 487–502; read also in this context Mao’s writings in the post-revolution China such as On the Ten Major Relationships (1956), where Mao introduced the problem in this way: “there are some problems in our work that need discussion. Particularly worthy of attention is the fact that in the Soviet Union certain defects and errors that occurred in the course of their building socialism have lately come to light. Do you want to follow the detours they have made? It was by drawing lessons from their experience that we were able to avoid certain detours in the past, and there is all the more reason for us to do so now.”—https://​www.​marxists.​org/​reference/​archive/​mao/​selected-works/​volume-5/​mswv5_​51.​htm (accessed on 31 January 2015); see also equally important from the theoretical point of view, and On the Correct Handling of Contradictions among the People(1957)—https://​www.​marxists.​org/​reference/​archive/​mao/​selected-works/​volume-5/​mswv5_​58.​htm (accessed on 31 January 2017).