Periodizing Capitalism and Capitalist Extinction

Periodizing capitalism and theorizing its stages of development is a research field that originates with the writings of Karl Marx. However it is also taken up in the post-WWII era by non-Marxian economists and sociologists. Two major epistemological strategies are deployed in it: the attempt to identify an essence or constant of capitalism from which transmutations of capitalism and its stages are derived; and the stylizing of empirical history to set out salient features of a period of capitalist development. This chapter summarizes the major approaches to periodizing capitalism and the ordering of the material in the book.

In distinguishing between formal and real subsumption of the labor and production process of society by capital Marx provides a formative periodizing of capitalism. Yet, losing sight of Marx’s subtle distinctions, it would be the writings of Karl Kautsky, in whose hands the very term Marxism originates, that most influenced generations of Marx’s followers. Kautsky maintained that Marxism is a theory of historical directionality. He argued that Marx’s study of capitalism constituted a subtheory of historical materialism and confirmed socialism as the historical telos. A combination of theoretical problems deriving from Kautsky’s reconstruction of Marxism plus the fact that capitalism would survive its first major economic crisis at the close of the nineteenth century to emerge reloaded in its imperialist stage by the early twentieth century animated the important work of Rudolf Hilferding, V.I. Lenin, and Nicolai Bukharin. Theorizing of imperialism provides the foundation for studies of the corporate form of business enterprise and what is referred to today as financialization.

Initial periodizations of post-WWII capitalism by Marxist theorists picked up where early twentieth century theorists of imperialism left off. The Monopoly Capital perspective of Paul Baran and Paul Sweezy maintains the post-WWII era as a phase of increased monopolization leading to endless crises. J.K. Galbraith, in a non-Marxist approach, drew conclusions in line with Marxists on the “organized” nature of post-WWII capitalism. Such organization in his view leads to the formation of a new overarching managerial class of sorts dubbed the “technostructure”. With technostructure management, according to Galbraith, the potential for crises claimed by Marxists is dampened. Ernest Mandel offers a sweeping and sophisticated periodizing of capitalism from its inception. He theorizes the post-WWII stage as “late capitalism” and produces an important and enduring argument for the crisis of the golden age.

Beginning in the 1970s and continuing into the 1980s and 1990s a spate of largely non-Marxist writings attempted to capture momentous changes that major, advanced economies were undergoing. Particularly significant among the changes were the expansion of service sector employment as a percent of total employment and diminution of employment in industry, the emergence and spreading application of information and computer technologies, horizontal disintegration of corporate capital, transformation of the international financial architecture, and rise of a speculation economy. Sociologist cum futurist Daniel Bell, Scott Lash and John Urry, as well as Michael Piore and Charles Sabel all drew radical conclusions over the transformations which they believed vitiated Marx’s views on socialism supplanting capitalism. While the aforementioned writers produced theories of change predicated upon systematizing empirical history in stylized facts, Giovanni Arrighi and Carlota Perez treated the above changes in terms of new sweeping periodizations of capitalism over the course of several centuries.

Regulation School and Social Structures of Accumulation periodizations of capitalism switched the course of Marxist theory away from theorizing stages of capitalism based upon a historical teleology. By combining research strategies of systematizing empirical history and elaborating upon a constant of capitalism each approach arrived at the idea of intermediate theory as a “level” of theory mediating between abstract economic theory and historical studies. Intermediate or mid-range theory operates as a form of institutional analysis capturing non-economic supports capital relies upon to avert crises and sustain decades of accumulation. Concern of these theories with factors stabilizing accumulation also brings to bear analysis of crises tendencies of capitalism. Of particular interest in this chapter are debates among Marxist and non-Marxist theories of the specific crises tendencies which led to the demise of the post-WWII golden age of capitalism.

Because of language difficulties, the Japanese Uno–Sekine approach to Marxism, based upon pioneering work of Kozo Uno, his student Thomas Sekine, and a growing cast of followers, both in Japan and around the world, has never received the acclaim it deserves for its interventions in Marxian theory and debate. Questions of periodizing capitalism, for example, were treated innovatively in line with writings of Regulation Theory and Social Structures of Accumulation theory, yet well in advance of the latter’s formulations. The Uno–Sekine approach is distinctive within the field of Marxist studies for two reasons. First it argues for the relative separation of historical materialism and Marxian political economic study of capitalism as two distinct projects with divergent subject-matters. Second it maintains that Marxian political economy be undertaken at three levels of analysis—a pure economic theory of capital, a stage theory which periodizes capitalism, and empirical-historical studies of capitalism.

Processes euphemized as globalization and financialization offer the most significant economic transmutations shaking advanced capitalist economies during the final decades of the twentieth century and into the twenty-first century. Globalization entails the disintegration of full-scale industrial production centered economies carrying ramifications for both the mass commodified labor forces capital maintained in the post-WWII period in its heartlands and the activities of erstwhile production centered corporations themselves which morph into “brands” that no longer make anything. Financialization involves the transformations of capitalist finance which produces a financial and historical regression to antediluvian practices most associated with ancient usury that expropriate wealth rather than intermediate in its generation and augmentation. Financialization and globalization interpenetrate to the detriment of humanity.

Nineteenth-century economist David Ricardo, as a defender of rising bourgeois class interests, inveighed against rent-seeking by landed classes of the day lest monies be diverted from profit-making investment in industry to the detriment of economic growth. John Maynard Keynes, writing during the Great Depression, similarly castigated financial rentiers of his time for drawing wealth from capitalist investment, even advocating the euthanizing of the rentier class. Yet today, between rents accruing to holders of patents, trademarks, copyright, brands, and so forth, and interest or financial rents flowing into hands of individuals and institutions in the burgeoning speculation economy, Ricardo’s and Keynes’ nightmare of diminished profitable investment and income generation leading to sustained deflation has materialized as an historical fact. A combination of the hypertrophic force of indirect costs of intangible assets on vestiges of capitalist production operating alongside predatory expropriations of financialization is tantamount to the “landlordization” of capitalism.

A raft of apocalyptic appellations for the current economic state—gore, carceral, authoritarian, and cancer capitalism—have been recently proffered. It is argued that the pathologies these works emphasize point not to a form of capitalism but the extinction of the capitalist species. However, technocratic management by neoliberal states of capitalist decay mean that in lieu of a concatenation of unforeseen events there will be no final great meltdown to bring the masses onto the streets demanding change akin to Marx’s envisioned heroic class struggles. Rather the extinction of capitalism will unfold as a slow and agonizing death as dystopian scenarios of starvation, disease, and urban violence break down the last fabrics of social control sending the über wealthy with their private contracted security forces scurrying for “safe zones” either on earth or other planets.