Book Review of Foster & McChesney's "The Endless Crisis: How Monopoly-Finance Capital Produces Stagnation and Upheaval from the USA to China"

The Endless Crisis: How Monopoly-Finance Capital Produces Stagnation and Upheaval from the USA to China. John Bellamy Foster & Robert W. McChesney Hardcover: 224 pages. Publisher: Monthly Review Press (September 1, 2012). Language: English. ISBN-13: 978-1583673133

By David Fields

Over-accumulation stemming from the so-called golden age of global capitalism has ensued an era of underconsumption as exemplified by low profit rates and chronic excess capacity. As such, what has taken place is an historical transformation towards the process of financialization. With an inability to absorb effectively economic surpluses, concerning the promotion of rising wages along with productivity, NFCs, or non-financial corporations, are coerced to paying a larger share of their internal funds, specifically via debt leveraging (including consumers), to financial institutions. These financial institutions, which are increasingly concentrated in the hands of fewer and fewer people, have become some of the most powerful actors. Increasing concentration of control within the financial sector lends credence to Marx's (1894: 544-45) argument that what Foster & McChesney call the age of monopoly finance capital is one in which

[t]he credit system, which as its focus in the so-called national banks and the big money lenders and usurers surrounding them, constitutes enormous centralization, and gives this class of parasites the fabulous power, not only to periodically despoil industrial capitalists, but also to interfere in actual production in a most dangerous manner-and this gang knows nothing about production and has nothing to do with it.

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Ben Fine on British Coal Industry's Contribution To Work of Paul Sweezy

My research has delved me into the plethora of work produced by the 'Monthly Review School'. Interestingly enough, I came across this article by Ben Fine, which I found to be quite illuminating. 

From the abstract:

Paul Sweezy has been a central figure in the understanding and development of Marxist political economy both in the United States and more widely in the West. For a long period, much like his counterparts in the United Kingdom, Maurice Dobb and Ronald Meek, his was almost a lone voice along with his close collaborators, most notably Paul Baran. Much has changed in the last twenty years with the renewed intellectual interest in Marxism following the student activisim of the sixties-so much that Marxism has even attained the status of academic respectability. This has meant that whilst there was always opposition to the Sweezy problematic (as represented by the “Monopoly Capital” or Monthly Review school), only in recent years has it been substantially criticised and counterbalanced by alternative schools of Marxism. In particular, there has been a lessening sympathy for underconsumptionist theory; for the notion that monopoly and competition are inversely related; for the validity of the concept of the potential surplus and its compatibility with value theory; and, as a more general aspect of the latter, that monopoly and competition and accumulation can be analyzed independently of the labour (value-producing) process, whatever the merits of Braverman’s (1974) seminal contribution. In addition, unfortunately on the margins of political economy, rather than its occupying a central position of debate as within the often supposedly separated discipline of economic history, Sweezy has been a prime mover in the debate on the transition from feudalism to capitalism’ which has subsequently given way to the “Brenner Debate” [...] The purpose of this article could hardly be to provide a “political economy of Sweezy.” For this, the present author cannot claim adequate acquaintance with Sweezy ’s intellectual and political biography. Indeed, here we rely exclusively upon the articles of Sweezy that have appeared in the academic journals. As a study of the evolution of Sweezy’s political economy, we have made use then of only a few of the pieces of the jigsaw that make up his intellectual biography, although we also have available some overall picture of the “final product,” as represented in his mature works.

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Monthly Review: The Baran–Sweezy Letters Project

By Nicholas Baran

The correspondence of Paul Baran and Paul Sweezy in the 1950s and early ‘60s is one of the great, unknown legacies of Marxian political economy in the United States. Over the past year and a half, I have been transcribing all of these letters with the goal of having the collection published by Monthly Review press, both as a hardcopy book of selected letters, as well as an unabridged e-book. In commemoration of my father, Paul A. Baran, on the fiftieth anniversary of his death on March 26, 1964, we decided to refer publicly for the first time to the Baran–Sweezy Letters Project and to publish a few important and representative letters.

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Herbert Marcuse on Paul Baran’s Critique of Modern Society and of the Social Sciences

Paul Baran and Herbert Marcuse's (author of One Dimensional Man) friendship went back to their days together at the Institute for Social Research (the foundational school of critical theory in the social sciences, which led to the future establishment of The New School For Social Research in NYC, and became the intellectual impetus for spawning the 'New Left' in the US - for more on this, see here) in Frankfurt in pre-Hitler Germany. Their close connection is revealed in a series of letters they wrote to each other in the 1950s and early ’60s (posted this month on the Monthly Review website).

From John Bellamy Foster:

The following talk, delivered only days after the publication of Monopoly Capital: An Essay on the American Economic and Social Order by Baran and Paul M. Sweezy, Marcuse reveals his admiration for Baran’s article on “The Commitment of the Intellectual.”Marcuse also provides his understanding of the critical importance of Baran’s notion of economic surplus, as introduced in The Political Economy of Growth and its significance for the critique of monopoly capital. This throws light on Marcuse’s own use of the concept of monopoly capitalism, which is frequently mentioned in his work (see for example his Counter-Revolution and Revolt).

Marcuse criticizes Baran for rejecting—in “Marxism and Psychoanalysis”—the use of psychological terms and for distancing himself from Freudian psychoanalysis and its left interpretations. Marcuse was clearly disappointed (as he indicated in a letter to Baran on September 22, 1959, where he commented on the galleys to Baran’s article) that Baran had not embraced the kind of argument he himself had put forward in Eros and Civilization. Nevertheless, it is worth adding that Baran—as Marcuse no doubt understood and as their own correspondence reveals—was far from simply rejecting psychological issues out of hand. Baran’s essay on psychoanalysis was aimed at the critique of what he called “psychologism” and “social psychologism”—and not psychology and social psychology. He insisted in this respect that what was needed was a more revolutionary social psychology—that took into account as its initial datum the structure of capitalist society as a whole. He sought to push this view forward near the end of his life through the critique of the cultural apparatus, overlapping in this way with the concerns of such thinkers as Marcuse, Fromm, Williams, and Mills. (See the special July-August 2013 issue of Monthly Review on “The Cultural Apparatus of Monopoly Capital”). To the end Baran remained an uncompromising critic of the narrow economic rationalism of monopoly-capitalist society and the damaging effect that it exerted on the material existence, culture, and consciousness of humanity.

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Prabhat Patnaik - Finance and Growth Under Capitalism

By Prabhat Patnaik

Once we reject Say’s Law and recognize that capitalism is prone to deficiency in aggregate demand, we have to accept that sustained growth in this system requires exogenous stimuli. By exogenous stimuli I mean a set of factors which raise aggregate demand but are not themselves dependent upon the fact that growth has been occurring in the system; that is, they operate irrespective of whether or not growth has been occurring in the system. Moreover, they raise aggregate demand by a magnitude that increases with the size of the economy, for instance with the size of the capital stock. They are in other words different from “erratic shocks” on the one hand, and “endogenous stimuli”, such as the multiplier‐accelerator mechanism, on the other: the latter can perpetuate or accelerate growth only if it has been occurring anyway.

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Introduction to the Second Edition of "The Theory of Monopoly Capitalism"

Introduction to the Second Edition of "The Theory of Monopoly Capitalism" by John Bellamy Foster:

The Theory of Monopoly Capitalism: An Elaboration of Marxian Political Economy was initially written thirty years ago this coming year as my doctoral dissertation at York University in Toronto. It was expanded into a larger book form with three additional chapters (on the state, imperialism, and socialist construction) and published by Monthly Review Press two years later.2 The analysis of both the dissertation and the book focused primarily on the work of Paul Baran and Paul Sweezy, and particularly on the debate that had grown up around their book, Monopoly Capital: An Essay on the American Economic and Social Order (1966).3 In this respect The Theory of Monopoly Capitalism was specifically designed, as its subtitle indicated, as an “elaboration” of their underlying theoretical perspective and its wider implications. 

My original motives for the analysis were twofold: (1) to provide a more thoroughgoing explanation of the economic surplus concept and the theory of accumulation to which it was related, and (2) to correct certain misconceptions of Baran and Sweezy’s analysis that had arisen as a result of the “back to Marx” intellectual movement of the 1970s—and that had led to various traditionalist or “fundamentalist” Marxian criticisms of their work.

See rest here.

The Quality of Monopoly Capitalist Society: Culture and Communications

From the editors of Monthly Review:

Below is a hitherto unpublished chapter of Paul A. Baran and Paul M. Sweezy, Monopoly Capital (New York: Monthly Review Press, 1966). The text as published here has been edited and includes notes by John Bellamy Foster. The style conforms to that of their book. Part of the original draft chapter, dealing with mental health, was still incomplete at the time of Baran’s death in 1964, and consequently has not be included in this published version. 

Paul Baran & Paul M. Sweezy

The culture of a society includes the education of its young, its literature, its theater, music, the arts—in short whatever contributes to the “training and refinement of mind, tastes, and manners…the intellectual side of civilization.” To inquire further into the culture of monopoly capitalism, we have here selected for attention two areas which offer a larger body of specialized research and which we judge to be decisive for the quality of culture as a whole: book publishing and broadcasting. These are both now big businesses, and they therefore demonstrate the striking extent to which culture has become a commodity, its production subject to the same forces, interests, and motives as govern the production of all other commodities. 

The development of big business in the cultural field has of course been possible only because of the enormous increase in the productivity of labor under advanced capitalism. In earlier times culture was the monopoly of a tiny minority, while the vast majority had to work most of their waking hours to keep body and soul together. 

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"The Endless Crisis" reviewed in Marxist Sociology Section (ASA) Newsletter

 

Book Review: The Endless Crisis: How Monopoly-Finance Capital Produces Stagnation and Upheaval from the USA to China, by John Bellamy Foster and Robert W. McChesney

Review by David Fields and Daniel Auerbach

The Monthly Review, since its inception, has been carrying on some of the best works in Marxism. The analytical foundations of what has come to be called the Monthly Review School were set out by the economists Paul Baran, Paul Sweezy, and Harry Magdoff. The lucidly rich works like Monopoly Capital by Baran & Sweezy and Magdoff’s piece on Imperialism (along with Harry Braverman’s work on Labor and Monopoly Capital) have sustained Marx’s invaluable insights into the twentieth and twenty-first centuries.

Read rest here.

Marx, Kalecki, and The Monthly Review School

By John Bellamy Foster

A historical perspective on the economic stagnation afflicting the United States and the other advanced capitalist economies requires that we go back to the severe downturn of 1974–1975, which marked the end of the post-Second World War prosperity. The dominant interpretation of the mid–1970s recession was that the full employment of the earlier Keynesian era had laid the basis for the crisis by strengthening labor in relation to capital. As a number of prominent left economists, whose outlook did not differ from the mainstream in this respect, put it, the problem was a capitalist class that was “too weak” and a working class that was “too strong.” Empirically, the slump was commonly attributed to a rise in the wage share of income, squeezing profits. This has come to be known as the profit-squeeze theory of crisis ...

Read the rest here.