Society of Heterodox Economists Conference University of New South Wales, Sydney, 2-3 December 2013

Marxist crisis theory to 1932 and to the present: reflections on Henryk Grossmans Fifty years of struggle over Marxism
RickKuhn AustralianNationalUniversity Rick.A.Kuhn@gmail.com
HenrykGrossmansarticleandpamphletFiftyyearsofstruggleoverMarxism,18831932 providedasurveyofMarxismandparticularlyMarxistcrisistheorysinceMarxsdeath.He identifiedbothinnovationsinandmajordeparturesfromMarx'sownapproachamongstthose whocalledthemselvesMarxists.Theprocessesofinnovationanddeparturehaveboth continuedovertheperiodsince.ThispaperexploresGrossman'sassessmentsofMarxistcrisis theoriesupto1932,subsequenttheoreticaldevelopmentsandgroundstheseinanaccountof thematerialcircumstancesoftheirproduction. In1932,HenrykGrossmanwroteasubstantialsurvey(over20,000wordsinmytranslation, whichisanappendixtothispaper)ofMarxismoverthe50yearssinceMarxsdeath,foravery widelyuseddictionaryofeconomics;itwasalsopublishedasapamphlet,Fiftyyearsof struggleoverMarxism,18831932(Grossman2013).1Heconcentratedoneconomicanalyses, thoughhealsodealtwithpoliticsand,toamorelimitedextent,philosophy.Itstandsupwell, particularlythediscussionsofMarxisteconomics.InhistreatmentofMarxismingeneral, however,therearetwoparticularlynoticeablegapscomparedwithcontemporary assessmentsoftheclassicalMarxistcanon.AsupporteroftheCommunistInternational,which atthisstageregardedTrotskyasadangerousheretic,GrossmanwasclosetotheGerman CommunistPartythattoedthelinefromMoscow.Grossman,nevertheless,acknowledged Trotskystheoreticalwork.ButthesurveydoesnotmentionTrotskystheoryofpermanent revolutionwithitsimportantimplicationsforpoliticalandeconomicanalysis.Thetheoryis, moreover,discussedinworksbyTrotskyinGrossmansbibliography(Trotsky1970andTrotsky 1977).Parvussresponsestorevisionism,beforehispoliticalapostasy,arealsomentioned favourably,butnothiscontributiontothetheoryofpermanentrevolution(Parvus19).The absenceofAntonioGramscifromGrossmanssurveycanbeexplainedbytheItalian CommunistleadersfocusonItaliandevelopmentsinworkspublishedduringhislifetime,very fewofwhichappearedinlanguagesotherthanItalian.Gramscisprisonnotebookswerestill beingwrittenin1932andwereonlysmuggledoutofGramscishospitalroomafterhisdeath in1937,manyyearsbeforeanyofthetextswerepublished.

1 GrossmangenerallysignedhimselfHenrykGrossman.Thiswashowhisnameappearedinhis publicationsthatwereoriginallypublishedinPolish,French,YiddishandEnglish.Henryk GrossmannwasthemostcommonGermanrenditionofhisnameandtheoneusedinmostofhis ownpublicationswhichoriginallyappearedinGerman.Inreferencesbelow,thenameunderwhich eachpublicationappearedisused. GrossmanssurveyhasbeentranslatedforafourvolumecollectionofhisworksthatIamediting. Thevolumeswillincludeallofhispublishedessaysandsomepreviouslyunpublishedwritingson economictheoryandpolitics,mostnevertranslatedbefore,aswellasthefirstfulltranslationofhis TheLawofAccumulationandBreakdownoftheCapitalistSystem,andmajorstudiesofthe economichistoryofPoland.

ThefirstsectionbelowisanoverviewofGrossmansdiscussionofthehistoryofMarxscrisis theory,providingasummary.Afewimportantdevelopmentssincethenareconsidered,inthe spiritofGrossmansapproach,inthesecondsectionbeforeaverybriefcomparisonofthe stateofMarxistcrisistheorywhenGrossmanwroteandtoday. Grossmanssurvey Inthelate19thandearly20threvisionistsrejectedrevolutionarypoliticsandoneofthekey argumentsforrevolution:capitalismstendencytobreakdown.EduardBernsteinsThe preconditionsofsocialismsetoutthecasein18989anditwasdevelopedbyothersonthe rightwingoftheSocialDemocraticPartyofGermany,notablyConradSchmidtwhoexplicitly rejectedthelabourtheoryofvalue.Capitalism,Bernsteinargued,hadovercomeitspropensity togothrougheconomiccrises.ItisnocoincidencethattheorganoftheGermanrevisionists fromthemid1890s,DieSozialistischeMonatshefte(TheSocialistMonthly)wasoriginallycalled DerSozialistischeAkademiker(TheSocialistUniversityStudent). Forthesemen,conductingthesmallscalewarforentirelygradualimprovements inthesituationoftheworkersthatwereagainandagainthreatenedbysetbacks, allradicalismrepresentedathreattothepositionstheyhadconquered,their organizationsandtradeunionfunds. Anotherrevisionistexplanationofcrisesandargumentagainstcapitalismstendencytobreak downwasdevelopedbyMikhailTuganBaranovsky,aRussianlegalMarxist(1894,German edition1901).LikeBernstein,anadherentofmarginalutilitytheory,heattributedcrisesto disproportionbetweenindustries.ThiswasemployedbyRudolfHilferdinginhisimmensely influentialFinancecapital(1910)andOttoBauerina1913critiqueofLuxemburg.Bothcame tobelievethatdisproportioncouldbeovercomebythepoliciesofaparliamentary,social democraticgovernment.HilferdingwastwicetheGermanfinanceministerinthe1920s,while BauerwastheleaderofAustriansocialdemocracyfrom1918andbrieflyforeignminister, helpingpreventaworkersrevolutioninthenew,rumpAustrianstate. FollowingEngelsandLenin,Grossmanattributedtheseviewstotheinfluenceofthe bourgeoisieonthelabourmovementthroughthetoplayersoftheworkingclassandpetty bourgeoisadherentsofsocialistparties,boughtoffwithsomeofthesuperprofitsgainedfrom imperialism.Bourgeoisworkersparties,liketheBritishLabourParty,wereanexpressionof theemergenceofthislayer.Grossman,however,alsopointedoutthatreformismwas especiallysuitedtotheinterestsoftradeunionleaders. AgainstBernstein,theleftistHeinrichCunowin1898explainedthebreakdowntendencyin underconsumptionistterms:workerswerenotpaidenoughtobuyallthattheyproducedand exportmarketswouldonlybeabletoabsorbthisexcessforalimitedperiod,beforecapitalism developedthewholeworld.Between1901and1911,KarlKautsky,themostprominent Marxisttheoristintheworld,andinhiswidelyreadEnglishworkof1907,LouisBoudin,also embracedthisargument.RosaLuxemburg,in1913,provideditwithafarmoresystematic groundinginthehistoryofcrisistheory,drawingespeciallyontheworkofSimondede Sismondi,earlyinthe19thcentury.Luxemburgrecognisedthatthetheoryofbreakdownwasa keyelementofMarxsanalysisofcapitalismandthecaseforsocialism.But,likeCunow,she defendeditwithfaultyargumentsthatwerenotMarxs,assertingthathehadfailedto recognisethatcapitalismcouldsurvivewithoutexternalmarkets. TheRussianRevolutionandBolshevik/communistorganisationandactivityledtoarecoveryof Marxistpolitics,philosophyandeconomics,associatedwiththeworkofLenin,Lukcsand Grossman,allwithexperienceaspracticalrevolutionaryleaders.

GrossmanrecoveredMarxsexplanationofcapitalismsbreakdowntendencyintermsofthe progressivenatureofcapitalistproduction,whichhasrepeatedlymeantthatlesslabourcan producemorecommodities.Thisveryprocessentailsatendencyfortherateofprofittofall which,beforeMarx,hadbeenidentifiedbyAdamSmithandJohnStuartMill.Capital accumulationisbiasedtowardsinvestmentinconstantratherthanvariablecapital:each workeroperatesmoreequipment;theratiothecostofthecapitalusedtothewagesbill increases,asUScensusstatisticsdemonstrated.Inotherwords,theorganiccompositionof capitalrises.Whileexploitation,therateofsurplusvaluerises,and(uptoapoint)themassof surplusvalueincreases,thisdoesnot,inthelongerterm,fullyoffsettherisingorganic compositionofcapital. BoudinandGeorgCharassoffsensedthatMarxexplainedcapitalismstendencytobreakdown intermsoftherateofprofit.But,unlikeGrossman,theydidnotidentifythewayinwhich,as accumulationoccurstherateofexpansionofsurplusvalueslowsdown,evenifthemassof surplusvalueisstillincreasing.Eventuallyapointwillbereachedwhenthemassofsurplus valueisinsufficienttomaintainanygivenrateofaccumulation.Thisisevenmorethecase becausetheabsolutevalueofnewtheindividualitemsofconstantcapital(machines,buildings etc)alsotendstogrow.Beforethatpointclassstruggleswillintensifyastherequirementsfor theaccumulationofconstantcapitalencroachonthesurplusvalueavailableforthe consumptionthecapitalistsandtopayfortheemploymentofnewworkers.FollowingMarx, Grossmanalsoidentifiedcountertendenciesthatslowortemporarilyreversethetendencyfor therateofprofittofall.Theseincludedthecheapeningofbothconstantcapitalandtheitems workersconsume,whichisaconsequenceoftheincreasedproductivityoflabour;reduced turnovertime;unequalexchangeandcapitalexportchannelsurplusvaluefromlesstomore developedterritories. Grossmanusedhissurveytomakeimplicitrepliestothecriticsofhismostinfluentialwork, Thelawofaccumulationandbreakdownofthecapitalistsystem(1929).Againsttheargument thathehadadvancedatheoryofautomaticeconomicbreakdownhereferredtoLeninand stressedthathisanalysis,farfromdenyingthesignificanceoftheclassstruggle,provideda frameworkinwhichitcouldbeunderstoodandhencemademoreeffective.Themechanisms thatcounteractthetendencyfortherateofprofittofall,Grossmanalsopointedout,only operatetemporarilyandtoalimitedextent. Crisistheorysincetheearly1930s GrossmansapproachwascaricaturedanddismissedbyreformistsandStalinistsandtheir academicacolytesinRussia(headedbyStalinslieutenantineconomicsJenVarga,who becameStalinslieutenantineconomics)andthewest(notablyNatalieMoszkowska1935and PaulSweezy1942)asatheoryofautomaticcapitalistbreakdown.Andthemidnightinthe century(Serge1982)theriseofNazismandStalinisminthe1930smeantmassivesetbacks fortheorganisedworkersmovementandtheuttermarginalizationofrevolutionaryMarxist politics. VargaappropriatedLuxemburgsunderconsumptionisttheoryofbreakdown,while denouncingLuxemburgherselfandmovingfurtherawayfromMarxsanalysis.From1928,he arguedthattechnologicalchangewasleadingtoanabsolutedeclineinthenumberofworkers (Day1981:14653).Anunderconsumptionistaccountofcrisesandthegeneralcrisisof capitalism,stretchingbacktoWorldWarI,becametheorthodoxyinRussiaandthe internationalCommunistmovement,astheStalinistcounterrevolutionshutdownbroad publicdebate,notonlyoverpoliticalandeconomicissuesbutalsoindiscussionsofphilosophy,

artandevenscience.Thiswasthemostwidespreadunderstandingofeconomiccrises amongstselfidentifiedMarxistsformorethanfourdecades.HavingquotedMarxonthe stupidityofRicardossuccessors,Grossman,inhisThelawofaccumulation,hadobserved that ThedifferencebetweenMcCullochandtheothervulgareconomistsandMarxs epigones,e.g.Varga,nowonlyliesinthereversedorderoftheircontradictory assertions:namelythattheyconcedetheoverproductionofcommoditiesand turnitintoanessentialpointintheirdoctrinesbutdenytheoverproductionof capital,whileRicardosepigonesconcedetheoverproductionofcapitalbutdeny thatofcommodities.(Grossmann1929:517) A1928Communisttextbookofpoliticaleconomystillaccommodatedboth underconsumptionistanddisproportionalitytheoriesofeconomiccrisis,whichconstitutedthe parametersofdebateintheUSSR.ItreferredtoworksbyBukharin,themostprominent proponentoftheoriesofdisproportionalityandstillaleaderoftheCommunistParty,Varga andoneofhismostimportantcriticsSpektator,i.e.MironIsaakovichNakhimson(Lapidus andOstrovitianov1929:3723,432,455,539). InNovember1930,theAgrarianInstituteinMoscowmadeGrossmanamember,in recognitionofthevalueofhisbook.After1931,however,Sovietwriterswoulddisagreewith oneanotherwithintheboundsofdiscourseestablishedbyStalinandVarga,butrarelywould theyoverstepthem.DuringavisittotheRussiain1932,onNakhimsonsinvitation,Sergei MitrofanovichDubrovskii,theheadoftheAgrarianInstitute,confidedtoGrossmanthatno oneheretakesVargaseriously.ButthecogencyofVargasworkhadlittletodowiththe ascendencyofhistheoryastheunchallengeableorthodoxyofStalinscounterrevolutionary, statecapitalistregime,whichexecutedNahkimsonandBukharin,in1938(Kuhn2007:140). In1935,VargaprovidedanempiricalandtheoreticalreportontheDepressiontotheSeventh CongressoftheCommunistInternational.Depressionsweretheresultofadeclinein consumingpower(wagespluscapitalistsprivateexpenditure)comparedtosocietys expandingproductivecapacity.Vargaattemptedtocomplementhisexplanationofthe generalcrisiswithanaccountofcyclicalcrisesbutamountedtoarecapitulationofhis analysisofthegeneralcrisis.Consequently,hiseconomicsystemwasindeterminate,incapable ofexplainingthemovementsoftherealworldeconomybecauseitconflatedshortandlong termmovements.Norcoulditallowthepossibilityofarecoveryfromthegeneralcrisis(Varga 1935:20;Day1981:263;Mommen2010:125). VargasapproachwasnowtheeconomicorthodoxyinStalinistRussia,expressedinLeontievs textbooks(1935:2467,253).In1939,Vargareiteratedthatotherfeaturesofeconomiccrisis intermsoftheproblemofthemarket,whichboileddowntothepurchaseofmeansof consumption(andnotmeansofproduction)byworkersandcapitalists(Varga1929:889). AlthoughVargafellfouloftheregimeforaperiodafterWorldWarII(ineffect,fornot retrospectivelyadjustinghisargumentinabookaftertheofficiallinehadchanged), Communisttextbooksstillassertedthatcapitalismwasinthemidstofitsgeneralcrisisdueto theproblemofmarkets,whichledtoafurtherimpoverishmentoftheproletariatwellinto thelongpostwarboomofwesterncapitalism(InstituteofEconomics1957:367).Bythe 1960s,accordingtothetheoryofstatemonopolycapitalism,whichVargaembraced,the monopolybourgeoisiedidnotlosemuchfromacrisiswhoseburdenwasbornebyworkers andweakersectionsofthenonmonopolybourgeoisie.Neverthelessthegeneralcrisisof capitalismpersistedandmassunemploymentwaspermanent(Varga1962:1212). TheUSeconomistPaulSweezyhelpedkeepradicalideasandclassanalysisaliveineconomics, asdidothersoftandhardStalinistsinavarietyofareas.Hisinfluentialandverywellwritten

Thetheoryofcapitalistdevelopment,publishedin1942,introducedimportantGerman debatesoverMarxisteconomicstoreadersofEnglish.Necessarily,hisownjudgements colouredtheaccount.Buttherewasalessadmirableside.HedistortedHenrykGrossmans position,entirelyignoringGrossmansdiscussionofcountertendenciestothetendencyfor therateofprofittofall.LikeGrossmanssocialdemocraticandStalinistcritics,Sweezy condemnedhismechanisticthinking(Sweezy1970:211).GrossmanwrotetohismateBill Blakein1947 ItisnotsoimportantformetowritealetteragainstthedistortionsofMrSweezy. IfIwillnotbeabletopublishanEnglishbookonMarx,suchaletterwillnothelp. IfIwillpublishabook,thenIwillcrushhimallbonesandthereaderwillbeable tojudgehimselfwhichbookgivesreallysuperiorinterpretationofMarxtheory. (Kuhn2007:207) Unfortunately,Grossmandiedin1949withoutwritingsuchareply,thoughitispossibleto constructoneonthebasisofhisearlierwork. TheexplanationofeconomiccrisesthatSweezyfavouredwasunderconsumptionistmore sophisticatedthantheStalinistorthodoxy,articulatedbyVarga,butbroadlycompatiblewith it.Capitalismstendencytounderconsumptionhasbeenoffsetbycounteractingforces. Investmentinnewindustries,beforetheycomeintofullproduction,andinvestmentsthatturn outnottohavebeenjustified,andthereforedonotproducemeansofconsumption,reduce thevolumeofcommoditiesthatwouldotherwisebeproduced.Populationgrowth, unproductiveconsumptionbysomepeoplenotinvolveddirectlyinproducingcommoditiesas capitalistsorworkers,somestateexpenditures(includingtheexportofcapital)supposedly increasetheoveralllevelofconsumption.Commerceandimperialismalsoreduce underconsumptionbyslowingcapitalaccumulationandraisingconsumption(Sweezy1970: 21736,280,309,315).SweezyalsouncriticallyportrayedRussiaassocialistandquoted favourablyfromStalin(Sweezy1970:35462).Suchstanceswouldnothavealienatedreaders sympatheticordedicatedtoStalinismand/ortheSovietUnion,whentheUSSRwastheheroic allyoftheUSAandtheCPUSAwaspromotingclasscollaborationtoassistthewareffort (Isserman20:145).2 WithLeoHuberman,SweezyinitiatedandeditedMonthlyReviewin1949.Themagazinehad considerableinfluenceintheUSAandabroadfordecades.MonopolyCapitalism,coauthored bySweezywithPaulBaran,in1966,offeredareformulatedunderconsumptionistaccountof economiccrisiscombinedwithapowerfulcritiqueoftheUSrulingclass.BaranandSweezy maintainedthatundermonopolycapitalism,owingtothenatureofthepriceandcostpolicies ofthegiantcorporations,thereisastrongandsystematictendencyforsurplus[thetermthey prefertomassofsurplusvalue]torise,bothabsolutelyandasashareoftotaloutput(Baran andSweezy1966:79).Buttheconsumptionofanexpandingpopulationandinvestmentto supplythatpopulationandinnewtechnologygrowsataslowerpace,whileforeign investmentintensifiestheproblem(BaranandSweezy1966:90108).Surplusisabsorbedand thesystemkeepsgoingthankstospendingonadvertising,governmentoutlays,especiallyon militaryrivalrywiththeworldsocialistsystem(BaranandSweezy1966:191).Thepoliticsof MonopolyCapitalismwereThirdWorldist:writingofftheUSworkingclassasanagentfor radicalchangeinfavourofstrugglesoutsidethemostadvancedcapitalistcountriesfor withdrawalfromtheworldcapitalistsystemandtheinitiationofsocialandeconomic
2 AreviewinCommunistcontrolledNewMasses,whilehighlightingdeviationsfromStalinistdogma, patronisinglyrecommendedSweezysasaprovocativebookthatdeservesseriousstudy (Tamarkin1943:27).TheEnglishCommunisteconomistMauriceDobbprovidedacomplimentary, thoughnotuncriticalforewordfortheEnglishedition(Dobb1946:vvi)

reconstructiononasocialistbasis,suchasthosewhichachievedvictoryinVietnam,China, Korea,Cuba,andAlgeria,(BaranandSweezy1966:3635). Marxistorganisation,politicalandeconomictheoryrevivedinsideand,moreimportantly, outsidetheacademy,withtheupturninclassstrugglefromthelate1960s.Particularlyinthe UnitedStateswherethelinksbetweenthenewleftandtheworkingclassweretenuous,the affinitybetweenthecrisistheoryinMonopolyCapitalismandbothStalinistandKeynesian approaches,andthebooksThirdWorldismappealedtoandreinforcedtheinclinationsof substantialelementsofthenewleft.TheTheoryofCapitalistDevelopmenttoobecameakey referencepointforacademicallyinclinedyoungradicalswithaninterestinMarxist economics.3Sweezystreatmentofthetransformationproblemprovidedabasisfordialogue betweenthemandmainstreamuniversityeconomists. TheneoRicardianeconomist,LadislausBorkiewicz,arguedin1906thatthewayMarxtreated theimplicationsofthewaytherateofprofittendstoequaliseacrossindustrieswaswrongand providedanalternativeaccount.InThetheoryofcapitalistdevelopment,Sweezyendorsed Bortkiewiczssolutiontothisproblemofthetransformationofvaluesintopricesof production.Afewyearslater,hetranslatedandeditedthefirstEnglishversionofoneof Bortkiewiczskeytexts(Bortkiewicz1949). AccordingtoBortkiewicz,Marxwasmistakeninstartingfromvaluesandendingupwithprices ofproductioninhisdiscussionoftheemergenceofpricesofproductionintherealworld.In reality,allcommoditiesareexchanged(assumingawaymarketfluctuationsandmonopoly)at theirpricesofproduction.SoBortkiewiczformulatedasysteminwhichallcommodities exchangeattheirpricesofproductionandthereisadeterminateratiobetweenthevaluesand pricesofproductionineachofthethreedepartmentsproducingImeansofproduction,II meansofconsumptionandIIIluxurygoods,solongastotalpricesofproductionequaltotal valuesorthepriceofproductionoftheoutputofdepartmentIII(assumedtobegoldi.e. money)equalsitsvalue.ThismodelisincompatiblewithMarxsassertionthatthevalueof totaloutputisthesameasitstotalpriceofproduction,thatthevalueoftotalsurplusvalue andprofit(transformedsurplusvalue)arethesame,andthatthevalueandpriceof productionrateofprofitarethesame.(foracomprehensivestudyofthehistoryand significanceofthetransformationproblemanddefenceofMarxspositionseeKliman2007). BypromotingBortkiewiczssolutionandmethodology,Sweezyandhissuccessorssmuggled thegeneralequilibriumfantasiesofmainstreameconomics(andneoRicardianeconomics),in whichthevaluesandpricesofproductionsinputsandoutputsaredetermined simultaneously,intoMarxism.IfHilferderingandBauerwere,asGrossmanputit, neoharmonistsSweezyandhissuccessors,whoswallowedthesamebourgeoiseconomicpill, wereneoneoharmonistsorperhapshyperharmonists.Theseassumptionsprovidedthe basisforOkishios(1961)mathematicaltreatmentofcapitalaccumulationwhichwasregarded asadefinitiverefutationofthelawofthetendencyfortherateofprofittofallbymanyanti MarxistsandprofessedMarxists(notably,Brenner1998:1112)alike. AccordingtoAttewell,therewasanalmostunchallengedhegemonyofunderconsumptionist theoriesinAmericancirclesuptotheearly1970s(1984:180,likewiseandFosterand McChesney2010:53,who,however,mistaketheUSAfortheworld).Therewereexceptions, notablytheworkofPaulMattickandRomanRosdolsky,whohadparticipatedinprewar revolutionarymovementsinEurope.MattickhadbeenacouncilcommunistinGermanyand, afterhehademigratedtotheUSA,hadestablishedarelationshipwithHenrykGrossman, whoseapproachtocrisistheoryhechampioned.RosdolskyhadbeenaCommunistandthen
3 ForSweezysinfluenceseeGregoryAlbosobituary(2004).

TrotskyistinPolishoccupiedUkrainianterritory,PragueandVienna,andeasternEurope.Inhis pathbreakingworkonMarxsGrundrisse,TheMakingofMarxsCapital,andotherworkshe highlightedanddefendedMarxsexplanationofcrisesintermsofthetendencyfortherateof profittofall,refutingcriticismbyJoanRobinsonandPaulSweezy,amongstothers(Rosdolsky 1977:398411).MattickpointedoutthatMonopolyCapitalwasinternallycontradictoryand derivedthedynamicsofcapitalismfromthesphereofcirculationand,focusingonprice relationsandtechnology,abandonedthelabourtheoryofvalueandMarxsperspectivefrom classrelationsinproduction(Mattick1966;forarelatedcritiqueofKeyness underconsumptionismseeMattick1971). AfterWorldWarII,therewerefewlinkswithandeffortstobuildontheachievementsof Marxisteconomicanalysisbeforethemidnightofthecentury.ThefruitfulwesternMarxism thatexpandedandPerryAndersonhasdescribed,wasmainlytheproductofacademics, includingsomeadherentsofCommunistparties.ItspractitionersnotablyMaxHorkheimer, TheodorAdorno,HerbertMarcuse,LucienGoldmann,JeanPaulSartre,MauriceMerleau Ponty,GalvanodellaVolpe,LucioColletti,HenriLefebvre,LouisAlthussermainlyfocusedon philosophyandliteratureratherthanpoliticsoreconomics. TherevolutionaryMarxisttraditionofattemptingtocombinetheoryandthepracticeof workingclassstrugglewaskeptaliveonlybysmallnumbersofpeople,particularlyTrotskyists. TonyCliffoffereddistinctiveandoriginalanswerstothecrucialquestionsaboutcapitalismin theperiodafterWorldWarII,concerningthenatureoftheStalinistregime,thenatureofthird worldrevolutionsandtherootsofreformism(Cliff1974,Cliff1963andCliff1982a).Heandhis organisationinBritain,nowcalledtheSocialistWorkersParty,alsotookupanddevelopedan explanationofthelongpostwarboomintermsofthepermanentarmseconomy,developed intheUSAbyEdSard(writingunderpseudonymsOakes1944andVance1951;Cliff1982b.For theprovenanceofthetheoryHiggins1997).ThereisanunclearconnectionbetweenSards originalcontributionandthetendencyfortherateofprofittofall,butthesewere overshadowedbyanessentiallyunderconsumptionistunderstandingofthemechanismat work,hardlydistinguishablefromSweezys,bothinhisdiscussionsandCliffs. MichaelKidronelaboratedamoresystematicexplanationintermsofthewayarmsspending couldoffsetthetendencyfortherateofprofittofallbyreducingtheamountofsurplusvalue availableforcapitalaccumulation.HebolsteredtheargumentwithreferencestoBortkiewiczs andPieroSraffasmodelsinwhichtheorganiccompositionofindustriesproducingluxury commodities,thatwereneithermeansofproductionnormeansofconsumption,didnot affecttheaveragerateofprofit(Kidron1967,Kidron1974:1923).Butthiscasecouldbe sustainedwithoutrecoursetotheequilibriumassumptionsofthesemodels,asHarman pointedout.First,surplusvaluewhichthestateappropriatedfromprivatecapitalistswasnot availabletobeaccumulatedbythemandthusraisetheorganiccompositionofcapital. Secondly,iftheorganiccompositionofcapitalishigherinindustriesproducingcommodities thatdonotreturntheproductionprocess,likeluxuriesandarms,thanthoseproducingmeans ofproductionandmeansofconsumptiontheprocessofequalisingprofitrates(the transformation)willreducethepricesofproductionofmeansofproductionandmeansof consumptionandraiselikeluxuries.Astheinputsintothenextroundofproductionwillbe cheaper,therateofprofitfromthatroundwillbehigher(Harman1984:3843,Harman2009: 49,12932). ThemoreorthodoxTrotskyistErnestMandelformalisticallyidentifiedthetendencyforthe rateofprofittofallasacauseofcapitalistbreakdownbutdidnotrelateittocyclicalcrises, whichheattemptedtoexplainbysynthesisingunderconsumptionistanddisproportionality theory(Mandel1968:16670,34279).ThemainthemeofhishighlyeclecticLateCapitalism

(1975)wasatechnologicallydeterministaccountofeconomicfluctuations,usingtheconcept oflongwaves. Therevivalofclassandsocialstrugglesfromthe1960screatedawideraudienceforMarxist ideas.Insideandoutsideuniversities,someolderMarxistpoliticalorganisationsexpandedand newonesweresetup.Maoistorganisationsmadethemostrapidgainsinmanydeveloped countries.OrganisationsfromtheTrotskyisttraditionalsorecruitedandsome,notablyin Britain,France,theUnitedStatesandAustralia,sustainedtheirinfluenceformuchlonger. Inuniversities,agenerationofMarxistundergraduatesandgraduatestudents,someofwhom wentontobecomeacademicsemerged.Theirtheoreticaleffortseventuallygaverisetonew journals.ThosewhichhadasubstantialMarxisteconomiccontentandstillappearinclude ReviewofRadicalPoliticalEconomics(founded1969)andResearchinPoliticalEconomics (1977),intheUSA;Prokla(1979)inGermany;CapitalandClass(1971)andCritique(1973)in Britain;JournalofAustralianPoliticalEconomy(1977);StudiesinPoliticalEconomy(1979)in Canada.ApartfromMonthlyReview,otherolderjournals,whichsurviveandhavepublished significantarticlesonMarxisteconomicsincludeScience&Society(1936)intheUSA; InternationalSocialism(1958)andNewLeftReview(1960)inBritain;DasArgument(1959)in Germany. Between1967and1971,studiesbyGrossmanwererepublishedinGermany;fromthemid 1970s,translationsofworkswhichhadoriginallypublishedinGermanappearedinFrench, Italian,English(inabridgedform,withanintroductionbyTonyKennedy,Grossmann1992), SpanishandSerboCroatian.ArgumentsbyMattickandRosdolskythatsupportedorbuilton Grossmanspositionfoundnewaudiences.Therepublicationsandtranslationswerepreceded andfollowedbynewappreciationsandapplicationsofhiswork,stimulatedbytheendofthe longpostwarboomandhencethedwindlingcredibilityoftheKeynesiantheorieswhose proponentshadclaimedcreditforit.4 Thedeclineinthelevelsofclassandotherstrugglesfrombelowafterthe1970s,contraryto thehopesofrevolutionaries,demoralisedmanyandthefarleftcontracted.Alsoundermined bytheturninChineseforeignpolicytoreconciliationwiththeUSA,mostMaoistorganisations collapsed.SeveralgroupsfromtheTrotskyisttraditionfaredbetterinBritain,France,theUSA andAustralia.AsthetideofstrugglerecededMarxistacademics,particularlythosewhowere notintegratedintorevolutionaryorganisations,werestrandedonthe(relativelycomfortable) beachoftenuredappointmentsandwereaffectedbythechangedpoliticalclimate.Alan FreemanpointedoutthatmostacademicMarxistsfromthe1960seithercontinuedthe traditionofwesternMarxism,primarilyconcernedwithphilosophy,literatureandculture ratherthanthematerialbasisofsocialrelations;or,likeSweezy,theydepartedfrom fundamentalaspectsofMarxsanalysisofproductionrelations,includingtherelationship betweenvaluesandpricesofproduction,infavouroftheequilibriummethodologyof mainstreameconomics.Theincreasinglyconservativeatmosphereputpressureonradical academicstomoveontohighergroundthatwassaferfortheircareers,thatis,totheright. Sometookapostmodernistpath,evenineconomics,whileothersconcludedthatmajor amputationswerenecessaryinordertosaveMarxisttheory.TheneoRicardiancritiqueof Marx,whichdatedbacktoBortkiewicz,gainedparticularmomentumduringthe1970s includingamongstselfidentifiedMarxists(seeGanmann1983;alsoSteedmanetal.1981,
4 AmongstthemostimpressivediscussionsorapplicationsofGrossmansworkduringthe1970s wereDeutschmann1973,Schmiede(1973)andCogoy(1987b),inGerman;Cogoy(1987aand 1987c)inFrench,althoughthesedrewgreaterattentionamongstreadersofEnglish;Yaffe(1973), whohadearliercollaboratedwithSchmiede,andShaikh(1978)inEnglish;Marramao(1975)in Italian.

whichcontainsanessaybySweezydefendingthelabourtheoryofvalueanddistancing himselffromtheBortkiewiczmodelhehaddonesomuchtopopularise,Sweezy1981:256; Freeman2010:86).Journalsnotassociatedwithpoliticalorganisationsbecameincreasingly academicasmassmovementssubsided. Fromtheearly1980s,however,advocatesoftheTemporalSingleSystemInterpretation(TSSI) oftherelationshipbetweenvaluesandpricesdefendedMarxstreatmentofthe transformationofvaluesintopricesinCapital3andthus,bydemolishingsolutionswhich wereincompatiblewithhisaccountofthetendencyfortherateofprofittofall,reinvigorated thisexplanationofcrises.Theyexplainedthatthevaluesoftheinputsforeachcycleof productionwerethepricesofproductionoftheoutputsofthepreviouscycle(seeKliman 2007:1414,15765). ThecontroversyoverMarxistcrisistheoryandparticularlythelongrundebatebetween supportersofexplanationsintermsofthetendencyfortherateofprofittofalland underconsumptioncontinuedinrivalinterpretationsoftheglobalcrisis(forexample,falling rateofprofit:Harman2009,McNally2010,Kliman2012;underconsumption:Fosterand Magdoff2009). JohnBellamyFosterandRobertMcChesneycontinued,aseditorsofMonthlyReview,toinsist onthetruthofSweezysunderconsumptionismandextendedthemyththatGrossman believedintheinevitablebreakdownofcapitalismtolaterproponentsofhisanalysisaswell (FosterandMcChesney2010,alsoFoster1986:1214).TheyalsorecruitedMichaelHeinrich, theGermanMarxologistwhoseapproachderivesfromthedifferenttraditionoftheNeue MarxLektre(newreadingsofMarx)andalsohasaffinitieswithpostmodernism,tothe projectofcombatinginEnglishMarxsexplanationofcrisesintermsofthetendencyforthe rateofprofittofall.Tothisend,HeinricharguedthatMarxbrokeinsufficientlywithhislabour theoryofvalue;thatthereisnosystematicrelationshipbetweenvaluesandprices;and,inthe spiritoftheFrankfurtSchoolshostilitytoempiricalresearch,thatsurplusvalueisanon empiricalcategory.OkishioandneoRicardianpropositionsservedhimasdemonstrationsof theuntenabilityofMarxslabourtheoryofvalue(Heinrich2013and,atgreaterlength, Heinrich2006:27284,32841).HeinrichprojectedhisownconclusionsontoMarx.Infact, Heinrichpulledhisconclusionsoutofhisownpomoinclinations.Hisostensibleevidencefrom manuscriptsandeditionspublishedinthenewCollectedWorksofMarxandEngelsamounted tomakingfancifulinterpretationsofthebreadthofMarxsresearchinterestsandofafew briefcommentsmadeduringthe1870sand1880s(seedevastatingcriticismsbyCarchediand Robertsforthcomingaandforthcomingb;andKliman,Freeman,Potts,GusevandCooney 2013). References
Albo,G.(2004)InMemoriam:PaulSweezy,19102004.PaulSweezyandAmericanMarxism,Studiesin PoliticalEconomy,74,Autumn,pp.1332 Anderson,.(1989)ConsiderationsonWesternMarxism,Verso,London[1976] Attewell,P.A.(1984)RadicalPoliticalEconomysincetheSixties:ASociologyofKnowledgeAnalysis, RutgersUniversityPress,NewBrunswick Baran,P.A.andP.M.Sweezy(1966)MonopolyCapitalism:AnEssayontheAmericanEconomicand SocialOrder,MonthlyReview,NewYork Boddy,R.andJ.Crotty(1975)ClassStruggleandMacroPolicy:ThePoliticalBusinessCycle,Reviewof RadicalPoliticalEconomics,7(1),April,pp.119 Bortkiewicz,L.(1949)OntheCorrectionofMarx'sFundamentalTheoreticalConstructionintheThird VolumeofCapital,inE.BhmBawerk,R.HilferdingandL.Bortkiewicz,KarlMarxandtheClose

ofHisSystemandBhmBawerk'sCriticismofMarx,togetherwithanAppendixConsistingofan ArticlebyLadislausvonBortkiewiczontheTransformationofValuesintoPricesofProductionin theMarxianSystem,Kelley,NewYork[1907] Brenner,R.(1998)TheEconomicsofGlobalTurbulence,NewLeftReview,229,pp.1265 Carchedi,G.andM.Roberts(forthcominga)ACritiqueofMichaelHeinrich:CrisisTheory,theLawof theTendencyoftheRateofProfittoFallandMarxsstudiesinthe1870s,MonthlyReview ____ (forthcomingb),MarxsLawofProfitability:AnsweringOldandNewMisconceptions,Critique Cliff,T.(1974)StateCapitalisminRussia,Pluto,London,[1948] ____ (1963)PermanentRevolution,InternationalSocialism,12,pp.1522 ____ (1982a)EconomicRootsofReformism,inTonyCliff,NeitherWashingtonnorMoscow:Essays onRevolutionarySocialism,Bookmarks,London,pp.108117[1957] ____ (1982b)PerspectivesforthePermanentWarEconomyinTonyCliff,NeitherWashingtonnor Moscow,Bookmarks,London,pp.1017[1957] Cogoy,M.(1987a)NeoMarxistTheory,Marx,andtheAccumulationofCapital,InternationalJournalof PoliticalEconomy,17()2,Summer,pp.1137 ____ (1987b)TheTheoryofValueandStateSpending,InternationalJournalofPoliticalEconomy,17 (2),Summer,pp.75110 ____ (1987c)TheFallingRateofProfitandtheTheoryofAccumulation:AReplytoPaulSweezy, InternationalJournalofPoliticalEconomy,17(2),Summer,pp.5474 Day,R.(1981)TheCrisisandtheCrash:SovietStudiesoftheWest(19171939),NLB,London Deutschmann,C.(1973)DerlinkeKeynesianismus,Athenum,Frankfurt Dobb,M.(1946)ForewordinPaulMaylorSweezyTheTheoryofCapitalistDevelopment,Dobson, London Glynn,A.andR.Suttcliffe(1972)BritishCapitalism,WorkersandtheProfitSqueeze,Penguin, Harmondsworth Foster,J.B.andR.W.McChesney(2010)ListenKeynesians,It'stheSystem!,MonthlyReview,61(1)1, April,pp.4456 Foster,J.B.andF.Magdoff(2009)TheGreatFinancialCrisis:CausesandConsequences,MonthlyReview Press,NewYork Freeman,A.(2010)MarxismwithoutMarx:Anotetowardsacritique,Capital&Class,34(1)8497 Ganmann,H.(1983)MarxwithouttheLaborTheoryofValue?,SocialResearch,50(2),Summer,pp. 278304 Grossman,H.(2013)FiftyyearsofstruggleoverMarxism,18831932,manuscripttranslationbyEinde OCallaghanandRickKuhn[1932,1933] Grossmann,H.(1929)DasAkkumulationsundZusammenbruchsgetzdeskapitalistischenSystems (zugleicheineKrisentheorie),Hirschfeld,Leipzig ____ (1992)TheLawofAccumulationandBreakdownoftheCapitlistSystem,BeingalsoaTheoryof Crises,abridgedtranslationofGrossmann(1929),Pluto,London Harman,C.(1984)ExplainingtheCrisis:AMarxistReAppraisal,Bookmarks,London ____ (2009)ZombieCapitalism:GlobalCrisisandtheRelevanceofMarx,Bookmarks,London Heinrich,M.(2006)DieWissenschaftvomWert:DieMarxscheKritikderpolitischenkonomiezwischen wissenschaftlicherRevolutionundklassischerTradition,WestflischesDampfboot,Mnster, [1991] ____ (213)CrisisTheory,theLawoftheTendencyoftheProfitRatetoFall,andMarxsStudiesinthe 1870s,Monthlyreview,64(1)1,April,pp.1531 Higgins,J.(1997)Appendix1inJimHiggins,MoreYearsfortheLocust,ISGroup,London,available http://www.marxists.org/archive/higgins/1997/locust/app01.htm,[accessed23October2013] InstituteofEconomicsoftheAcademyofSciencesoftheUSSR(1957)Politicaleconomy,Lawrence& Wishart,London[1955] Isserman,M.(1993)WhichSideWereYouOn?TheAmericanCommunistPartyduringtheSecondWorld War,UniversityofIllinoisPress,UrbanaandChicago[1982] Kennedy,T.(1992)HenrykGrossmannandtheTheoryofCapitalistCollapseinH.Grossmann,TheLaw ofAccumulationandBreakdownoftheCapitlistSystem,BeingalsoaTheoryofCrises,Pluto, London,pp.127.

Kidron,M.(1967)APermanentArmsEconomy,InternationalSocialism,28,available http://www.marxists.org/archive/kidron/works/1967/xx/permarms.htm,[accessed23October 2013] ____ (1974)Capitalism:TheLatestStage,inMichaelKidron,CapitalismandTheory,Pluto,London [1971] Kliman,A.(2007)ReclaimingMarxsCapital:ARefutationoftheMythofInconsistency,Lexington Books,Lanham,MD ____ (2012)TheFailureofCapitalistProduction:UnderlyingCausesoftheGreatRecession,Pluto, London Kliman,A.,A.Freeman,N.Potts,A.GusevandB.Cooney2013,TheUnmakingofMarxsCapital: HeinrichsAttempttoEliminateMarxsCrisisTheory,available http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2294134,[accessed26July2013] Kuhn,R.(2007)HenrykGrossmanandtherecoveryofMarxism,UniversityofIllinoisPress,Urbanaand Chicago Lapidus,I.A.andK.V.Ostrovitianov(1929)AnOutlineofPoliticalEconomy:PoliticalEconomyandSoviet Economics,Lawrence&Wishart,London Mandel,E.(1968)Marxisteconomictheory.Volume1,Merlin,London,[1962] ____ (1975)LateCapitalism,NLB,London,[1972] Marramao,G.(19756)TheoryoftheCrisisandtheProblemofConstitution,Telos,26,Winter[1975] Mattick,P.(1971)MarxandKeynes:TheLimitsoftheMixedEconomy,Merlin,London,[1969] ____ (1978)MonopolyCapitalinPaulMattick,AntiBolshevikCommunism,Merlin,London,pp.187 209[1966] McNally,D.(2010)GlobalSlump:TheEconomicsandPoliticsofCrisisandResistance,PMPress,Oakland Mommen,A.(2010)Stalin'seconomist:theeconomiccontributionsofJenVarga,Routledge,NewYork Moszkowska,N.(1935)ZurKritikmodernerKrisentheorien,Prague,Kacha Oakes,W.J.(1944)TowardaPermanentWarEconomy?,Politics,February,available http://marxists.org/history/etol/writers/vance/1944/02/pwe.htm,[accessed23October2013] Okishio,N.(1961)TechnicalChangesandtheRateofProfit,KobeUniversityEconomicReview,7,pp. 8599 Rosdolsky,R.(1977)TheMakingofMarxsCapital,Pluto,London,[1968] Schmiede,R.(1973)GrundproblemederMarxschenAkkumulationsundKrisentheorie,Athenum, Frankfurt Serge,V.(1982)MidnightintheCentury,Writers&Readers,London[1939] Shaikh,A.(1978)AnIntroductiontotheHistoryofCrisisTheoriesinBruceSteinbergetal.,U.S. CapitalisminCrisis,UnionforRadicalPoliticalEconomics,NewYork1978,pp.21941 Steedman,I.etal.(1981)TheValueControversy,Verso,London Sweezy,P.M.r(1970)TheTheoryofCapitalistDevelopment,MonthlyReview,NewYork[1942] ____ MarxianValueTheoryandCrisesinIanSteedman,etal.TheValueControversy,Verso,London, 1981,pp.2035 Tamarkin,B.(1943)ProvocativeStudy,NewMasses,8June,pp.257 Trotsky,L.(1970)TheThirdInternationalafterLenin:thedraftprogramoftheCommunistInternational: acriticismoffundamentals,PathfinderPress,NewYork,[1928] ____ (1977)HistoryoftheRussianRevolution,PlutoPress,London,[1930] Vance,T.N.(1951)ThePermanentWarEconomy,NewInternational,17(1),JanuaryFebruary,pp.29 44,availablehttp://marxists.org/history/etol/writers/vance/1951/permwar/part1.htm,[accessed 23October2013] Varga,E.(1935)TheGreatCrisisandItsPoliticalConsequencesEconomicsandPolitics19281934, ModernBooks,London[1934] ____ (1939)TwoSystems:Soci8alistEconomyandCapitalistEconomy,LawrenceandWishart,London ____ (1962)TwentiethCenturyCapitalism,ForeignLanguagesPublishingHouse,Moscow[1961] Yaffe,D.(1973)TheMarxianTheoryofCrisis,CapitalandtheState,EconomyandSociety,2pp.186 232