the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters.
This conception of crisis suggests a technological determinism as the basis of crisis and social change within the capitalist mode of production. The contradiction between forces/relations is also a historical contradiction that leads to the breakdown and then supersession of a mode of production. Yet what constitutes the forces of production is not a conceptually clear issue in Marxism, with some Marxists including, over and above the means of production and labour, science and geography into its definition. At the same time, where does this leave class struggle, particularly if, in the logic of accumulation, the forces of production have primacy? The blind veneration of technology and science associated with this perspective also has implications for the socialist alternative. For Stalin, it meant forced-march modernisation and building gigantic factories as the new basis for socialist relations of production. Yet this did not work and instead produced a tyrannical society. This conception of crisis, and ultimately social change, is a very contentious issue in Marxist thought.
In Capital, Marx abstracts to a very high level of generality the dynamics and tendencies that drive capitalism and its mode of production. Generally, the time taken to valorise money into capital, or M–C–M (money–commodity–money), is a simple, and the basic, idea of crisis in Capital. In other words, the failure to valorise money into capital produces crisis. In the three volumes of Capital there are three more important ideas that point to crisis tendencies in capitalism. This is Marx thinking at an abstract level about the deep structures of capital.
First, there is the notion of disproportionality. This relates to an allocation of resources between department one (means of production) and department two (means of consumption) within the scheme for simple and expanded reproduction. Essentially, given the anarchy of capitalist production, individual capitalists will tend to overinvest in a particular department. Allocation will not happen smoothly or rationally. The excess allocation of investment will lead to excess output, which cannot be sold, and the rate of profit will then decline relative to the narrow market. Furthermore, contraction in the overinvested department will not be matched by an adjustment in the underinvested department. This leads to aggregate demand falling, then to a realisation problem and then to a general crisis that ensues in both departments.
Second, underconsumption refers to a decline in aggregate demand, which ensues when capitalists cannot sell all they produce. Underconsumption points to a gap between supply, and what workers can purchase and consume. With workers not having a large enough proportion of the surplus, or with insufficient incomes, aggregate demand declines. Commodities are not sold and this creates a general crisis.
Third, overproduction refers to high levels of productivity or relative surplus value being produced as part of the generation of surplus output. This output or supply exceeds demand and cannot be sold, thus creating a general crisis.
Despite his recognising these tendencies towards crisis in capitalism, and as expressions of deeper contradictions, Marx did not bring these concepts together into a systematic theory of crisis.1 Therefore, Marx’s rich, complex, inchoate – and, in some instances, contradictory – approach to capitalist crisis laid the basis for further development of crisis theories. This task was left to subsequent generations of Marxists and it is a challenge we still face today. But guiding us in this endeavour is how Marx thought about and approached the study of capitalism (Ollman 2003). Marx abstracted, to different levels, to understand how social change happened in the context of capitalist society and this is presented in different ways, which enabled an appreciation of what is old/new, tendential/non-tendential, contradictory/non-contradictory and essential/non-essential.
This varied approach to understanding change applies to Marx’s understanding of crisis. Without an appreciation of the dialectical method in Marx’s thought, his discussion of crisis tendency, which is highly abstracted from capitalist reality and generalised, can easily be confused with an empirical trend. On the other hand, if crisis tendency is not situated within Marx’s method, it can be reduced to mono-causal economic determinism, understood in static terms, without the reader’s appreciating its interconnections with larger processes and the necessary conditions that bring it into being. Finally, Marx’s approach and method prompts a rigorous and studied approach to capitalist reality. This means that although capitalism is inherently prone to periodic crises, these have to be studied at every moment to understand the historical specificity of each crisis and its connections to larger patterns. This also means that Marxism as a body of knowledge is unfinished.
LIMITS AND CHALLENGES TO MARX’S UNDERSTANDING OF CAPITALIST CRISES
Marx’s thought is crucial to help one think about the dynamics and tendencies of contemporary global capitalism. The insights he provides from making the ‘capitalist mode of production’ an object of study are at the heart of how capitalism works in the abstract or pure level. These insights provide us with powerful resources to think about the political economy of global capitalism. However, at the same time, there are limits to how we can use Marx to think about the contemporary crises of global capitalism. This does not mean abandoning Marx. However, it does mean it is important to think in a Marxist way about our contemporary world. Merely applying Marx’s theoretical approach to crisis will not help us think about the nature of the contemporary systemic crises of capitalist civilisation. At most, a modified application of Marx’s theory of capitalist crisis will bring into view overproduction or financialised overaccumulation in our explanatory understanding.2 This is important, but it is also insufficient. Being aware of the problems and limits of Marx’s Marxism in relation to crisis theory helps us renew a Marxist approach to such a theory. Three main shortcomings with Marx’s understanding of capitalism and its crisis tendencies have to be considered.
First, although Marx’s conception of capitalist crisis and his explication of crisis tendencies in Capital are useful, they are economic-reductionist and are not sufficient to explain the nature of the contemporary crises of capitalist civilisation. There are material determinations in contemporary capitalism that go beyond even Marx’s conception of pure capitalism, as contained in the three volumes of Capital. Although Capital is a powerful heuristic device to help us think about the tendencies of capitalism, it is not able to address new concrete historical tendencies of contemporary global capitalism and crisis. For instance, climate change and peak oil are not part of the way pure capitalism is conceptualised in Capital, and these are powerful systemic crisis tendencies in today’s capitalism, which impose limits on and engender serious contradictions for global accumulation.
This is not to argue that Marx was blind to nature and ecology, or that a green reading of Marx is not valuable. Foster (1999) has done a great job in retrieving the dimension of nature in Marx’s conception of historical materialism. Foster’s work foregrounds the notion of ‘metabolic rift’ in Marx – a rift between town and countryside, and between humans and nature. However, the notion of metabolic rift is not a theory of crisis, and although it could be elaborated into such a theory post-Marx, the point here is Marx’s understanding of capitalist crisis. In Marx’s most elaborated work of capitalist crisis in Capital, his theoretical perspective has nothing to do with ecology and how this determines capitalism’s systemic crisis tendencies.
Second, Marx believed in general that capital is the all-dominating economic power of bourgeois society. This is a crucial premise for his theoretical understanding of capitalist crisis. In Capital, Marx goes further to make capital an object of enquiry as a social relation. Although Marx brilliantly understood capital in a relational sense, and as this applied to labour and capital, the structural power of capital today in the global political economy is shaping and determining not only the logic of capitalist accumulation, but also the future of all living forms – both human and non-human.
