economic crisis and the responsibility of socialists isr 68 published

8/3/2019 Economic Crisis and the Responsibility of Socialists ISR 68 Published

1/13

www.isreview.org

U.S.$5.95 Canada $5.95 UK3.60

ohn Pilger: Power and illusion Phil Gasper: What happened to change we can believe in?


2/13

Contents

INTERNATIONALSOCIALISTREVIEW

NovemberDecember 2009Issue 68

Published by the Centerfor Economic Researchand Social Change.

To subscribe, send acheck or money order(payable to ISR)with your address to:ISR, P.O. Box 258082,Chicago, IL 60625. BasicRate, First Class Mail:$29 for 1 year,$49for 2 years.Institutional Rate: $60.Canada/Mexico: $35.All other countries $60.U.S. dollars only.

The ISR is indexed inthe Alternative PressIndex, published by theAlternative PressCenter. The index isavailable online atwww.nisc.com.

The ISR is distributed to bookstores throughDisticor MagazineDistribution [email protected]

Reproduction ofmaterial contained inthe ISR is allowed onlywith permission. Forinformation, [email protected].

EditorAhmed Shawki

Managing EditorPaul DAmato

Associate EditorsJoel Geier, Sherry Wolf

Reviews EditorDavid Whitehouse

Editorial BoardAnthony Arnove, JulieFain, Phil Gasper, BrianJones, Tom Lewis, BillRoberts, JenniferRoesch, Eric Ruder,Helen Scott, LanceSelfa, Ashley Smith,

Keeanga-YamahttaTaylor, Annie Zirin

ProductionCindy Kaffen, BillRoberts, Lance Selfa,Elizabeth Terzakis,Dao X. Tran, AnnieZirin, Nancy Welch,Jesse Zarley

Business andCirculationAnnie Zirin

www.isreview.org

Cover design: Eric Ruder.

Editorial

1 The business of health care reform

Analysis in brief

Elizabeth Schulte

3 Why wont they call it racism?plus Obamas Afghan disasterEric Ruder interviews

Gareth Porter

Column

Phil Gasper Critical Thinking

7 What ever happened to change we can believe in?

Features

Shaun Joseph

10 The coup in Honduras: Perspectives and prospectsResistance to the coup is reshaping the countrys politics

Cleve Jones Interview

16 Getting back to our rootsHarvey Milks collaborator on the new LGBT movement

Walden Bello Interview

20 The G20 after the crashThe need for democratic control of the economy

John Pilger

24 Power, illusion, and Americas last tabooObamas real theme was power, not change

Chris Williams

28 Are there too many people?Food and environmental crises have convinced many

that Malthus might finally be right

Rick Kuhn

39 Economic crisis and the responsibility of socialists

History

Rebekah Ward

50 The reluctant revolutionaryDarwins achievement, 150 years after The Origin

John Riddell

58 Clara Zetkins struggle for the united frontThe German communists contribution to political strategy

Sharon Smith65 1934: The strikes that led the way

Struggles that formed the prelude to the CIO

Book reviews

Christopher Phelps Featured review

70 The sexual revolutionReview of Sherry Wolfs Sexuality and Socialism

Ian Angus

74 Two accounts of Engels revolutionary lifeplus Phil Aliff on soldiers resistance; Dave Florey

on racism in the aftermath of Katrina; Sarah Knopp and

Mais Jasser on a teenagers diary under occupation;

Marlene Martin on Mumia Abu-Jamals JailhouseLawyers; Chris Williams on Monthly Reviewsspecial

issue on food

Too many people? 28

Capitalism and the global food crisis 79

1934:The strikes

that led the way

65

Sexuality andsocialism 70

1934:The strikes

that led the way

65

The new LGBTmovement 16


3/13

NOVEMBERDECEMBER 2009

Isaac and TamaraDeutscher MemorialLecture, November 7,2008. Delivered at theSchool of Oriental andAfrican Studies, London.

Rick Kuhn is a reader inpolitical science in theSchool of Social Sciencesat Australian National

University in Canberra.

Economic crisis and the

responsibility of socialists

Economic crisis

The purpose of Henryk Grossmans economicresearches was to advance the class struggle. From1920, if not before, he subscribed to a particular,Leninist conception of Marxist politics that over-lapped with views he had already put into prac-tice well before the First World War, particularlyby helping to build a revolutionary organizationof Jewish workers in Galicia.

If Lenin recovered Marxs revolutionary con-ception of politics, Grossman recovered the revo-lutionary content and implications of Marxs eco-nomic analysis. Like Lukcs, who also drew onLenin and restored contradictory class interestsand perspectives to the center of Marxist philoso-phy, he stressed capitalisms crisis-prone logic andits mystification of that logic. By exploring theeconomic roots and implications of commodity

fetishism and their relationship to capitalist crises

and revolution, Grossman also complementedLukcss arguments in History and Class Con-sciousness, which focused on ideology and revolu-tion but not economics.1

Marxist and other criticisms of the way capital-ism generates oppression and alienation powerfullyjustify the struggle for socialism. As a young man,Grossman was himself actively involved in the Jew-ish working classs fight against both oppressionand exploitation. But, following Rosa Luxemburgand against those who thought that capitalismcould be reformed into socialism, he insisted thatMarx regarded the bourgeoisie as incapable of con-sistently sustaining workers lives.2 Capitalism has atendency to break down economically, throwing apart of the working class out of work, and attack-ing the living standards of those who retain theirjobs. Today that tendency is particularly apparent.

Grossman made two major contributions to

ByRICK KUHN

39

HENRYK GROSSMAN is particularly relevant today and not onlybecause of his explanation of economic and financial crises, whichI will briefly recapitulate. That theory was formulated and can

only be understood as an element in a broader, classically Marxist analy-sis of capitalist society and the way it can be superseded. The specifics ofGrossmans political outlook help explain the generally hostile receptionof his work in the immediate wake of the publication of his best-knownstudy, The Law of Accumulation and Breakdown of the Capitalist System,Being Also a Theory of Crises, and subsequently. Grossman expressed his

revolutionary Marxism not only in his writings, but also in political ac-tivity. That was not always flawless, on the contrary. But his views aboutthe responsibilities of socialists are superior to fashionable notions of theresponsibilities of intellectuals. Furthermore, the continuities and dis-continuities in his practice and, in some periods, the inconsistencies be-tween it and his theoretical commitments are instructive.


4/13

40

our understanding of economic crises. The first was al-ready outlined in 1919, developed in his 1929 The Law of

Accumulation, and further elaborated in (semi-published)detail in 1941.3 Capitalist production, he pointed out fol-lowing Marx, is at once a labor process creating use valueswith particular physical characteristics, and a process ofself-expanding value creating new wealth through the ex-ploitation of wage labor. This analysis provided

a means of eliminating what was deceptive in the purecategories of exchange-value, thus creating a foundationfor further research into capitalist production and af-fording him the possibility of grasping the real inter-connections of this mode of production behind the veilcreated by value.4

The satisfaction of the requirements for the propor-tional expansion of both these processes at once can onlybe passing and accidental. Far from being characterizedby equilibriumas assumed by the inaccurate and staticassumptions of mainstream economicscapitalism isnecessarily dynamic, uneven, and crisis prone. Grossmandemonstrated that this was even true in the case of simple

reproduction, where the scale of output does not expand.5Furthermore, capitalisms tendency to break down is

grounded in a contradiction at the heart of the produc-tion process. There is unlimited technical scope to expandthe productivity of human labor, but this is restricted bythe logic of production for profit, giving rise to the break-down tendency.6 The exposition and defense of Marxs ac-count of the way capitalism limits the possibilities for theself-expansion of value was Grossmans second, and best-known, contribution to crisis theory. It is, however,grounded in the first.

Capital accumulation means that the proportion be-tween the numbers of specific kinds of means of produc-

tion (raw materials, buildings, machinery, etc.) used inproduction increases compared to the number of workersemployed. This is the technical composition of capital.The ratio of the values of means of production to meansof consumption (on which workers spend their wages)the value composition of capitalchanges as, with tech-nological advances, the amount of labor time (the founda-tion of value) required to make them declines unevenly. Inthe longer term, however, there is no reason to believe thatthe value of means of production falls more rapidly thanthe value of means of consumption. So the organic com-position of capital, which expresses the effects of the tech-nical composition of capital on the value composition of

capital, tends to rise: capitalists spend increasingly moreon means of production than on buying labor power. AsGrossman pointed out in a passage that does not appear inthe English translation ofThe Law of Accumulation:

The pure value perspective that has been taken overfrom bourgeois economics has already permeated sodeeply into the consciousness of Marxs epigones of allcolours, from reformists to communists, that the mostbasic Marxist concepts have been distorted and cor-rupted. Thus the concept of the organic composition ofcapital. Marx distinguishes a technicaland a valuecom-position and finally, as the third concept, the organiccomposition, by which designation he understood thereciprocal relationship of the two previously identi-

fied, namely the valuecomposition of capital, in so farINTERNATIONAL SOCIALIST REVIEW

as it is determined by its technicalcomposition and re-flects changes in it. The organic composition of capital,formulated in this way is the most important factor ininquiry into capital accumulation. Of all this not atrace remains in the work of Marxs epigones.7

Among the mistaken commentators on the organiccomposition of capital, Grossman counted the socialdemocrats Karl Kautsky, Rudolf Hilferding, and Emil

Lederer; the Communists Eugen (Jen) Varga and NelliAuerbach; and the academic Ladislaus von Bortkiewicz,who ostensibly solved the transformation problem. Theorganic composition of capital is important because it isonly living labor that gives rise to new value. If organiccomposition rises while the rate of exploitation, theamount of surplus value produced will remain the samebut capitalists will have spent more to generate it. Therate of profit will have fallen.

Marx and Grossman identified the tendency for therate of profit to fall as a crucial contradiction in theprocess of self-expanding value. They also describedmechanisms that serve to counteract it. Among the coun-

tertendencies is the intrinsic cheapening of means of con-sumption through technological change, which can leadto increases in the rate of exploitation without cuts in

workers living standards. Crises also eventually lead toimprovements in profitability as bankrupt or failing busi-nesses sell off their assets at a discount to other firms

whose costs of production are thus reduced. Furthermore,when means of production lie idle and decay, crises de-stroy value. War has similar consequences. But there areother measures which capitalists and states can deliber-ately pursue to maintain or improve profit rates. Amongthese, attacks on workers living standards are particularlysignificant. Grossman explained that capitalisms break-down tendency takes the form of recurrent economiccrises, conditioned by the empirical course of the ten-dency for the rate of profit to fall and its countertenden-cies. For him, the tendency for capitalism to break down

was definitely not a unidirectional path to final collapse.There is also a fundamental connection between capi-

talisms crisis tendency and imperialism. Before WorldWar I, Marxists had elaborated theories of imperialism asa necessary consequence of capitalist development. KarlKautsky linked this with capitalisms crisis tendency,

which he generally understood in underconsumptionistterms, the problems capitalists have in realizing the sur-plus value embodied in commodities by selling them.

The system of trusts and cartels and that of militarismcannot guarantee the capitalist mode of productionagainst collapse. Neither can the export of capital withits resulting new-type colonial system. However, thenew colonial system, like the system of trusts and car-tels and that of militarism, has become a mighty meansof holding back this collapse for several decades.

Colonial policy has become a necessity for the capi-talist class, just as militarism has.8

Kautsky changed his mind in 1914. Like the starry-eyed proponents of globalization as the guarantor of worldpeace up to (and even beyond) the U.S.-led invasions ofAfghanistan and Iraq, Kautsky now maintained that thedegree of integration of capital across national boundaries,

ultra-imperialism, reduced the likelihood of war.


5/13


Rudolf Hilferding asserted, in 1910, that imperialismwas the economic policy of finance capital, which wasbound to lead towards war. He insisted that the idea ofa purely economic collapse makes no sense and did notlink imperialism to capitalisms crisis tendencies.9 Rosa

Luxemburg, however, provided an explanation of imperi-alist expansion into non-capitalist territories as a means tooffset capitalisms inability to realize the surplus value ithad created.

Accumulation is impossible in an exclusively capitalistenvironment. Therefore, we find that capital has beendriven since its very inception to expand into non-capi-talist strata and nations, ruin artisans and peasantry,proletarianize the intermediate strata, the politics ofcolonialism, the politics of opening-up and the exportof capital.10

Otto Bauer demonstrated that Luxemburgs proof thatcapitalisms survival depended on its expansion into non-

capitalist territories or spheres of production was wrong.He used a version of Marxs reproduction schemes, tablesthat followed the pattern of accumulation over successiveyears given certain assumptions, to show that capitalismcould survive in a purely capitalist world.11

Among the leading Bolsheviks, while NikolaiBukharin did not identify capitalisms tendency to break-down as a cause of imperialism in his major study,12

Lenin did. But he wrote little more than The need to ex-port capital arises from the fact that in a few countriescapitalism has become overripe and (owing to the back-

ward state of agriculture and the poverty of the masses)capital cannot find a field for profitable investment.13

Paradoxically, Bauers refutation of Luxemburg was the

starting point for Grossmans vindication of her basic po-sitions: that a breakdown tendency is inherent in capital-ism and gives rise to imperialism. Grossman extended asimplified version of Bauers own reproduction schemebeyond a few years and found that the system brokedown because of the tendency for the rate of profit to fall.He specified the nexus between capital accumulation, cri-sis, imperialism, and war in terms of efforts by capitalists

and states to offset the fall in the rate of profit. In particu-lar, unequal exchange through foreign trade helps bolsterthe profits of imperialist powers at the expense of less de-veloped countries,14while monopoly control over rawmaterials does so at the cost of their imperialist rivals.15

Finance capital and neo-harmonismAs during the 1920s and 1930s, orthodox economists

and governments have attributed the economic crisis thatbegan in 2007 to a lack of effective state regulationand/or transparency of the financial system.16 Identifyingthe immediate causes of the current crisis is an empiricaltask. Problems in the realm of finance and inadequate

state regulation have, indeed, been a trigger. But there isalso a methodological question: are there underlying,more fundamental processes that ultimately condition orgive rise to the surface appearance of the crisis? The issuehere is that ofabstraction. Henryk Grossman alreadystressed the importance of going beyond nave empiri-cism by abstracting from less salient features of the real

world in order to lay bare underlying structures in a 1919lecture. In The Law of Accumulation, he explicitly drewattention to, and himself employed, Marxs method inCapital, by initially abstracting from and then succes-sively reintroducing the complicating factors that arecharacteristic of concrete reality. As Grossman pointedout in a supplementary essay, Marx reorganized his planfor Capitalprecisely in order to implement this methodin his explanation of the capitalist mode of production.17

The growth of financial speculation over recentdecades was spectacular. Sub-prime housing loans in theU.S. were only one aspect of the phenomenon. Foreignexchange transactions in 2004 were more than sixty timesgreater than the value of all the worlds exports. In 2005,the notional amount of over-the-counter foreign exchangederivatives was almost two and a half times greater thanthe value of global exports.18 Other indices of the flow ofcapital into speculative rather than productive investmentwere the scale of private equity/leveraged buyouts and thefact that hedge funds in 2006 managed over U.S. $1.1

trillion. While the U.S. finance sector only realized 10percent of total corporate profits in 1980, the figure was40 percent in 2007.19 Most of the transactions on finan-cial markets are a zero sum game: players only gain at eachothers expense. The key question is why this shift, whichsome have called financialization, has taken place.

Grossman pointed out in 1929 that, as the rate ofprofit declines, capitalists in productive sectors will in-creasingly turn to speculative activity.20 This goes a long

way towards explaining recent developments. Low profitrates characterized the end of the long boom of the 1950sand the 1960s. They recovered in the wake of the reces-sions of the mid-1970s, early 1980s, and early 1990s

each in turn the deepest since the Depression. But not to41

Henryk Grossman


6/13

42

the levels of the long boom. So capitalists invested at anincreasing rate in speculative financial assets rather thanproductive activity.21 Grossman insisted

the very laws of capitalist accumulation impart to accu-mulation a cyclical form and this cyclical movementimpinges on the sphere of circulation (money marketand stock exchange). The former is the independentvariable, the latter the dependent variable.22

On this basis, he attacked social democratic neo-har-monists like Rudolf Hilferding, twice Germanys Finance

Minister during the 1920s, who argued that it was possiblefor the working class to take state power by parliamentarymeans and to overcome capitalisms pattern of booms andslumps on the road to socialism. The growing dominationof production by larger and larger corporations and cartels,Hilferding maintained, meant that a government couldachieve a forthright program of reform by managing thecapitalist economy, especially through state control overthe banking system.23 Resistance from the German SocialDemocrats coalition partners and the partys own timiditymeant that he never put his ideas into practice. But gov-ernments whose pronouncements were ever-so-recentlyneo-liberal are now trying out Hilferdings prescriptions

for pragmatic reasons. This applies in Europe, Asia andNorth America, but I will provide an antipodean example.In 2007, before the elections that made him Australias

Prime Minister, Kevin Rudd reassured business that hewas a fiscal conservative. But in early October 2008, theLabor Government decided valor was the better part ofdiscretion by speeding up expenditure on public infra-structure from the Future Fund. Again, this was designedto reassure corporate Australia: Labor will do whatever ittakes to secure growth and, especially, profits. In the faceof the crisis, a prolonged and careful assessment of how tospend the billions of dollars in the Fund on competingprojects was set aside. It was necessary to get the money

flowing to make up for the very rapid anticipated slow-

downs in Australian investment, consumption, and in-come from the export of minerals to China. A few dayslater the Board of the Reserve Bank of Australia, on

which the head of Treasury sits alongside a majority ofcorporate heavyweights, had the same fears as the govern-ment. So it cut the official interest rate by a whole onepercent, for the first time since 1992.24 Further, larger andmore desperate reductions in interest rates and attempts

to boost demand followed.These measures looked like Keynesian economics,

where the government steps in to sustain growth andmake up for the deficiencies of markets. But the massivepolicy shift was more than Keynesian. Governments ofthe worlds most prosperous countries provided tens andhundreds of billions of pounds and dollars to bail out firstprivate and state banks and then strategic manufacturingcorporations. In the U.S., Britain, Belgium, Luxembourg,the Netherlands and Iceland, they nationalized failingbanks. Some Republicans in the United States and con-servatives elsewhere expressed concerns about creepingsocialism, as governments made gifts to and took over

banks and promised to regulate the rest much moreclosely.25As the crisis deepens, there is bound to be evenmore overt state involvement in economic activity andmore of this kind of socialism, of which Hilferding

would have approved. Yet, whether such state capitalistmeasures are deemed socialist or not, the importantfinal chapter ofThe Law of Accumulation (missing fromthe English translation) concluded that they are unlikelyto resolve the underlying problems.26

As the crisis in the real economy intensifies, capitalistsand governments are turning, pragmatically, to measuresthat will help to restore profit rates. This is also true of bigspending governments, some of which invoke Keynes. In

the national interest they call on everyone to tightentheir belts for the common good. They have wage re-straint and responsible management of social securityoutlays in mind. In other words, they will intensify theclass struggle from above, attempting to raise profit ratesby increasing the rate of exploitation. Inflation and cur-rency devaluations can have this effect too, as Grossmanpointed out in relation to the French Socialist premierLon Blums devaluation of the franc in September1936.27 In the short term, as unemployment rises, suchmeasures will intensify the economic contraction by re-ducing consumer demand. In the longer run, at the ex-pense of mass misery, successful attacks on workers willhelp overcome the crisis. Another vital factor in a recoveryis the devalorization of capital resulting from bankrupt-cies, the sale of failing businesses in the productive sectorat large discounts, and state imposed rationalization of in-dustries by shutting down less efficient operations.

Grossman drew conclusions, which reflected his polit-ical orientation, from his analysis.

If capital now succeeds in pressing down wages and thusraising the rate of surplus value the existence of thecapitalist system can be prolonged at the expense of theworking class, the intensification of the breakdown ten-dencyslowed down and thus the end of the system post-poned to the distant future Conversely, if workingclass resistance counteracts or overwhelms pressure from

the capitalist class, the working classs struggles can winINTERNATIONAL SOCIALIST REVIEW

Karl Kautsky


7/13


wage rises. Thus the rate of surplus value will decline andconsequently the breakdown of the system will acceler-ate It is thus apparent that the idea of a breakdownthat is necessary on objective grounds, definitely does notcontradict the class struggle. Rather, the breakdown, de-spite its objectively given necessity, can be influenced bythe living forces of the struggling classes to a large extentand leaves a certain scope for active class intervention.28

ReceptionGrossmans book quickly became a reference point in

Marxist economics. But, with a few exceptions, reviewersand commentators were very hostile. The main reasonsare straightforward. In The Law of Accumulation, Gross-man had attacked a series of prominent socialist econo-mists in less than restrained terms. Many responded inkind. More importantly, his analysis was incompatiblenot only with bourgeois and social democratic but alsoStalinist and council communist politics.29

The reassertion of Marxs argument that a tendency tobreak down was inherent in capitalism found no sympathyamong defenders of the existing order and advocates, even

ostensibly Marxist ones, of reforming capitalism into social-ism. Grossmans book appeared in the course of the Stalin-ist counterrevolution in Russia. The construction of a po-lice state, competing militarily with western imperialismthrough rapid capital accumulation based on the hyper-ex-ploitation of the working class and peasantry, had conse-quences in the realm of ideas. Stalins regime was imposingunchallengeable orthodoxies on the discussion in the Com-munist movement of many areas of life, ranging from liter-ature and music, though history, social analysis and policy,to military doctrine and biology. Stalin anointed Jen Vargaas the guardian of Communist economic dogma in 1930.30

Varga, whom Grossman had specifically labelled an

epigone of Marx,31 subscribed to an underconsumptionistexplanation of economic crises which drew, unacknowl-edged, on Luxemburg. Grossmans approach, whichfol-lowing Marxstressed that the fundamental contradic-tions of capitalism derived from the organization of pro-duction rather than the circulation of value, was thereforeheresy. A focus on the production relations, at the heart ofthe logic of capitalism, might also prove embarrassing if ap-plied to the way work was organized in the Soviet Union.

The two main currents in the labor movement thereforeagreed that Grossmans analysis was flawed and mechanical,a theory of the automatic collapse of capitalism. Mostcouncil communists concurred. They did not distinguish

between Lenins development of the theory and practice ofworking class self-emancipation, that Grossmans economicanalysis was designed to complement, and Stalinism.

Where and when Grossmans work was taken seriouslyon the left, it was on the margins of the workers move-ment. In particular Paul Mattick, a council communist,

was a consistent proponent of Grossmans approach toMarxist economics from 1931 until the 1980s. The twocorresponded until Grossman moved to the UnitedStates, where they had contact with each other at leastuntil the early 1940s. Mattick rejected critiques of Gross-man formulated by two of the most prominent figures inhis own political current, Anton Pannekoek and Karl Ko-

rsch. He shared their rejection of Leninist politics but

simply sheared off this, for Grossman, crucial aspect ofhis analysis, defending only Grossmans main economicarguments. On the basis of two reviews he read while inprison, Antonio Gramsci expressed interest in Grossmansapproach to economic crises.32

Later, Bernice Shoul, associated with the SocialistWorkers Party in the United States during the 1940s,drew on Grossmans work in writings between 1947 and

1967.33 So did her friend Jean van Heijenoort, formerlyone of Trotskys secretaries, in a single article published inParis, shortly before he broke with Marxism.34 The veteranTrotskyist historian Roman Rosdolsky, in 1957, expressedreservations about Grossmans analysis but defended Marxand Grossman against Martin Trottmanns recycled, aca-demic criticism of any theory of breakdown in general,and Grossmans reproduction scheme in particular.

It was not until the late 1960s, with the growth of theradical student movement in Germany, that Grossmans

work and Marxs theory of capitalist breakdown found anew, wider, and more receptive audience. Two left wingpublishing houses, one of them created by members of

the radical Sozialistischer Deutscher Studentenbund(Social-ist German Student Union), republished Grossmansmain economic works between 1967 and 1971.35 PaulMattick continued to promote Grossmans economic the-ory to English and German speaking audiences and be-yond. There were translations of Grossmans work intoother languages. Capital and Classcarried his essayMarx, classical political economy and the problem of dy-namics in 1977. Jairus Banajis abridged translation ofThe Law of Accumulationwas published in 1992. Severalsubstantial essays by Grossman, however, are yet appearin English.

From the early 1970s, there was a flurry of interest in

Grossmans analysis of economic crises in German andEnglish.36 This continued into the early 1980s, but subse-quently slowed down, as class struggles and the Marxistleft declined, especially in the universities. Most of the ref-erences to Grossman focused on economic theory. Thereare, however, recent, more empirical applications ofMarxs approach along the lines of Grossmans analysis by,for example, Chris Harman and Patrick Bond.37 But thedominant view, shared by a spectrum that has stretchedfrom Stalinist textbooks in East Germany through variousanti-Stalinist Marxist economists to the most influentialaccount of the history of Marxist economics, by two radi-cal economists, has been that Grossmans approach is

flawed.38

The impressively scholarly biography of Gross-man by Jrgen Scheele, reproduced such assessments.39

Since the 1970s, many critiques of Grossman and/orMarxs presentation of the tendency for the rate of profitto fall by both non-Marxist radicals and self-identifiedMarxists, have invoked the Okishio Theorem, which re-lies on an equilibrium methodology alien to Marxism.After the revival of Marxism associated with the massstruggles of the 1960s and 1970s subsided, bourgeois eco-nomics again increasingly permeated the consciousnessof the briefly expanded ranks of Marxs epigones.40AlanFreeman has aptly labeled such attempts to explain Marx-ist economics using tools and assumptions drawn from

neo-classical economic theory Walrasian Marxism.41

43


8/13

44

Most of the treatments of Grossmans economic theo-ries since the 1960s have been undertaken in ignorance ofhis political orientations. The logic of his theory of break-down is still self-evidently anathema to those committedto a reformist path to socialism, let alone proponents of astable and humane capitalism.

The responsibility of socialists

Grossman stated, in an implicit but hardly disguisedreference to Vladimir Ilych Lenin, that his treatment ofcapitalisms tendency to break down was intended tocomplement analyses of the politics of revolution.42 Hisaccount was designed to help revolutionaries identify theobjective circumstances in which intense class strugglesand revolution were likely to emerge. When discussingthe politics of insurrection, he explicitly referred to Leninas an expert.43 From both his writings and his politicalpractice, Grossmans Leninist conception of revolutionarypolitics (the need to smash the capitalist state) and organ-ization (the role of a revolutionary party) are clear, exceptto those wedded to social democracy, Stalinism, or their

academic legacies.Yet Henryk Grossmans practical political activities ex-

pressed his conception of the responsibilities of socialistsmore eloquently than his writings. In pursuit of the goalof working-class self-emancipation, Grossmans actionsresisted the dominant currents of Polish and Jewish na-tionalism, social democracy and, for a brief period, Stalin-ism. At the center of his approach to politics was a com-mitment to building a revolutionary party.

The view that those critical of the established ordershould be involved in organizations devoted to bringingthat order down is currently unpopular. The expectationthat intellectuals, scientists, and academics should be dis-

passionate, objective, and apolitical is as widespread asthe positivist conception of science. Even among thosewho publicly take sides, it is scandalously common forradicals in words to be rather politically inactive in theirdeeds. Moreover, most of those who engage in strugglesagainst exploitation or oppression do not do so throughinvolvement in organizations, dedicated not to buildingfreedom but to moving the working class to build it,44

which attempt to tie struggles for reforms to the project ofrevolutionary change. Beyond the pragmatic assertion thatthe time is not ripe for any practical activity, there are ar-guments that people, intellectuals in particular, shouldavoid making commitments to revolutionary organiza-

tions. It is worth considering the most influential of thesebefore examining the case made by Grossmans practice.

Liberal, reformist and radicalconceptions of responsibility

Julien Benda would have regarded Grossman as a co-ac-cused in the betrayal of the intellectuals. In 1927 Bendaformulated a metaphysically rationalist conception of in-tellectuals and denounced their betrayal by participatingin mass political passions. Instead, they should devotethemselves to the truth, every life which pursues onlyspiritual advantage or sincerely asserts itself in the univer-sal, situates itselfoutside the real, and hence in a certain

manner say: My kingdom is not of this world. Benda

was, however, a defender of Dreyfus and an anti-fascist,who believed that intellectuals should proclaim the trutheven when this did not find favor with the authorities. 45

In his Representations of the Intellectual, Edward Said ap-propriated the core of Bendas argument: intellectuals arean elite of special individuals with a vocation for the art ofrepresenting positions to, as well as for, the public, whoshould be devoted to proclaiming the truth and conse-

quently always [stand] between loneliness and alignment.[T]here is a special duty to address the constituted andauthorized powers of ones own society, which are ac-countable to its citizenry, particularly when those pow-ers are exercised in a manifestly disproportionate andimmoral war, or in a deliberate program of discrimina-tion, repression, and collective cruelty.

More consistently than Benda, Said stressed the im-portance to the intellectual of passionate engagement,risk, exposure, commitment to principles, vulnerability indebating and being involved in worldly causes; and thatthe intellectuals belong on the same side with the weakand unrepresented.46 Saids own professional and politi-

cal work impressively matched his conception of the roleof an intellectual. He exposed the pervasiveness of imperi-alist modes of thought, particularly in high culture, andsupported the struggles of his fellow Palestinians even

when these were undermined by the leadership of thePalestinian Liberation Organization.

Although, for Said, political passions were acceptable,even desirable, a residue of Bendas emphasis on intellec-tual disinterestedness remained in his warning against po-litical gods that always fail and joining up, not simplyin alignment but in service and, though one hates to usethe word, collaboration. Said presented a false choice.On the one hand, he told us about McCarthyism, apos-

tates who flipped over from Stalinism or Trotskyism to theright, and the need to avoid subservience to authority.On the other hand, he portrayed true intellectuals withtheir convictions derived from their work and a sense ofassociation with others, but not acting at the behest of asystem or method, and essentially alone. While caution-ing against system and method, Said snuck their ghostlymoral shades through the wall, by invoking a consistentand universalistic ethic.47 His is a conventional, individu-alistic, liberal morality. It excludes the possibility that, tobe effective in the struggle for human freedom, our criticalabilities may best be exercised collectively.48

Saids book began as the 1993 Reith Lectures for the

BBC. He was an astute choice for this honor: a controver-sial figure in literary studies and on the Palestinian ques-tion who could attract an audience, yet his argument didnot go far beyond the bounds of liberal protest at oppres-sion. It struck a chord in a period when the extent ofmass struggles was limited and the anti-capitalist left, par-ticularly the organized anti-capitalist left, was shrinking.It appealed to those who identified with the suffering ofthe oppressed but did not challenge the individualism ofbourgeois common sense or the self-regard of intellectu-als, confident about their own special social role. And it

was summed up in a catchy slogan. Speak truth topower is vastly more respectable than an injunction to

promotemass action to change the world, however neatlyINTERNATIONAL SOCIALIST REVIEW


9/13


or succinctly expressed.The phrase was first published in a U.S. Quaker pam-

phlet.50 Its roots are in the Quaker tradition of bearingwitness on matters of social conscience and, further back,in narrowly theological propositions in the New Testa-ment passages about Jesus divine status and the relatedformulation that the truth shall make you free.51 It canembody an approach to change, through dialogue with

those in authority, that is no threat to the establishedorder. Teresa Kerry used it at the 2004 Democratic PartyConvention in a speech supporting her husbands cam-paign for the U.S. presidency.52 But invoking Saids call tospeak truth to power is a lot cooler and seems more rad-ical than acknowledging the slogans Quaker roots.53 Italso achieves little: as Lukcs pointed out, the capitalistclasss position in society makes it incapable of recogniz-ing some fundamental truths.54

Noam Chomsky succinctly specified the nature ofpower and the relationship of intellectuals, as a sociallayer with specific material interests, to it: They are, inGramscis phrase, experts in legitimation. They must en-

sure that beliefs are properly inculcated, beliefs that servethe interests of those with objective power, based ulti-mately on control of capital in the state capitalist soci-eties.55 Chomsky has demolished the moralistic, liberalapproach to politics and the notion that intellectuals needtheir own special code of behavior.

[M]y Quaker friends and colleagues in disrupting illegiti-mate authority adopt the slogan: Speak truth to power.I strongly disagree. The audience is entirely wrong, andthe effort hardly more than a form of self-indulgence. Itis a waste of time and a pointless pursuit to speak truth toHenry Kissinger, or the CEO of General Motors, or oth-ers who exercise power in coercive institutionstruthsthat they already know well enough, for the most part.

To speak truth to power is not a particularly honor-able vocation.56

If you want to change the way things are then the intel-lectual responsibility of the writer, or any decent person, isto tell the truth. More specifically, The responsibility ofthe writer as a moral agentis to try to bring the truth aboutmatters of human significanceto an audience that can dosomething about them.57 This link between telling the truthand political action was also a central argument in Chom-skys famous essay The responsibility of intellectuals.58

Yet Chomsky has become more coy about the truthrecently. We dont know the truth. At least I dont, hehas asserted.59 This claim is disingenuous, or at least self-contradictory. Clearly in making all the generally excel-lent arguments he does in books, articles, and interviewsabout a range of issues, especially U.S. foreign policy,Chomsky thinks he knows better than mainstream politi-cians and the mass media. And he is right. He usuallydoes know much better, if not the final, absolute truth.It is a bloody good thing that he argues his case, from aforthrightly anti-capitalist perspective. The following for-mulation is more specific about his conception of truth.It accurately describes the collective nature of science and

the importance critical thinking:Im always uneasy about the concept of speakingtruth, as if we somehow know the truth and only haveto enlighten others who have not risen to our elevatedlevel. The search for truth is a cooperative, unendingendeavour. We can, and should, engage in it to the ex-tent we can and encourage others to do so as well, seek-ing to free ourselves from constraints imposed by coer-cive institutions, dogma, irrationality, excessive con-formity and lack of initiative and imagination, and nu-merous other obstacles.60

But, in the context of his wider anarchist outlook, thisargument fudges issues too, just as Saids call for open-mindedness did.

Chomsky has been reluctant to distinguish betweenthe effectiveness of different forms of political activity, in-voking the importance of tactics appropriate to concretesituations: there has not in history ever been any answerother than, Get to work on it.61 This neglects the ques-tion ofstrategyand contrasts with the strategic emphasisthat Marxists place on the unique potential power of the

working class to replace capitalism with socialism. Thereare, moreover, some activities that Chomsky explicitly re-

jects, notably involvement in revolutionary groups whoseinspiration is the Marxist and Bolshevik tradition, nomatter how democratic, committed to promoting social-ism from below or counterposed to Stalinism they are.62

He reproduces Bendas and Saids liberal hostility toMarxist organizations.

Both Said and, much more convincingly, Chomskyhave drawn on Antonio Gramscis discussion of how tra-ditional intellectuals and organic intellectuals of the capi-talist class serve ruling class interests.63 Neither has ex-plored Gramscis observations about organic intellectualsof the working class.

While he notes that intellectuals are privileged andgenerally have special skills,64 Chomsky, unlike Said andBenda, does not draw a sharp dividing line between intel-lectuals and mortals. Comparing specialists interpreta-tions with the facts of contemporary affairs, according to

Chomsky the basis for understanding social issues, is45

Noam Chomsky


10/13

46

of some importance, but the task is not very difficult,and the problems that arise do not seem to me to posemuch of an intellectual challenge. With a little industryand application, anyone who is willing to extricatehimself from the system of shared ideology and propa-ganda will readily see through the modes of distortiondeveloped by substantial segments of the intelligentsia.Everybody is capable of doing that.65

This is fine in its assessment of peoples abilities but ig-nores the context in which they exercise them. The con-ception here of how critical ideas arise is voluntarist, de-pendent on individuals willingness to critically assessdominant ideas. Yet Chomsky has provided convincingaccounts of the operation of the propaganda system inmaintaining a conservative consensus, which marginalizesdissident thinking in liberal capitalist societies.66 His ownefforts to provide a course in intellectual self-defence67

are very valuable, but compared with the power of thissystem and the coercive forces that stand behind it, thescale of his individual contribution is necessary small. For,more profoundly than the propaganda system, our dailyexperience of the market and workthe fetishism ofcommoditiesgenerally reinforces ruling ideas.

There is a way to systematically magnify the ideology-dissolving effect of class struggles, which are a necessaryconsequence of capitalist society, into more sustained andwidespread criticisms of the established order, as a basis forpolitical action. It draws on the insight that knowledge is acollective product and Gramscis discussion of intellectuals.But his anarchism means that it is a path that Chomsky re-jects. Marxists efforts to build both the class struggle andrevolutionary organizations Chomsky dismisses with quo-tations from Mikhail Bakunin and thinly documented at-tacks on the Bolsheviks rather than references to Marxswritings or specific activities. It was, however, Bakunin

whose political practice was conspiratorial and elitist as amatter of principle and who justified this in writings.68

Marxism and revolutionary responsibilitiesMarx and Engels identified the working class as the

sole social actor that could replace capitalism with a dem-ocratic society whose logic was not profit but productionto satisfy human need. On this basis, they were them-selves involved in building organizations that sought toensure that the working class developed and used its ca-pacity to change the world.

In the Communist League, their activities among work-ers in Cologne and further afield during the German revo-

lution of 18481849, in the International Working MensAssociation from 1864 to 1872, and in their later relationswith the emerging socialist workers parties, they promotedthe growth of a layer of organized workers with an aware-ness of working-class interests and the capacity to advancesocial struggles by intervening into them. That was thepoint of the educational activity of the Communist League.An organizing perspective informed publications like theManifesto and The New Rhineland Newspaperand underlaythe production of in-depth analyses, like Class Struggles inFrance, The Eighteenth Brumaire of Louis Bonaparteand TheCivil War in France, and even theoretical texts like Capital.All were designed to be tools that organized workers could

use to make their struggles more effective.

In this spirit, the 1891 Erfurt program of the GermanSocial Democratic Party specified that It is the task ofthe Social Democratic Party to shape the struggle of the

working class into a conscious and unified one and topoint out the inherent necessity of its goals. Engels hadsuggested including, at this point, a reference to workerssaturated in the conscious of their class position.69

On the other hand, Marx and Engels pointed to in-

tellectual strata whose social function it was to foster suit-able fantasies in the interests of capital, as Hal Draperput it.70When people from these strata joined workersparties, which from being thoroughly exceptional becamemore common late in the nineteenth century, Engels ar-gued that they should

understand that their academic educationwhich inany case needs a basic, critical self-reviewgives them noofficers commission with a claim to a corresponding postin the party; that in our party everyone must serve in theranks; that posts of responsibility in the party will be wonnot simply by literary talent and theoretical knowledge,even if both of these are present beyond a doubt, but that

in addition what is required is a thorough familiaritywith the conditions of the party struggle and seasoning inits forms, tested personnel reliability and sound character,and, finally, willing enlistment in the ranks of the fight-ers;in short, that they, the academically educated peo-ple, have far more to learn from the workers, all in all,than the latter have to learn from them.71

In other words, leaders of the party needed to be ableto write, to be theoretically sophisticated and to have ex-perience as tested partisans of the working class. Thebackground of some leaders might be the intelligentsiabut Engels clearly expected all of them to be products ofthe party and its involvement in class struggles.

Karl Kautsky made a similar point in his 1903 article

Franz Mehring:

What the proletariat needs is scientifically groundedself-knowledge. The science that the proletariat needscannot be that which is officially recognised andtaught. Its theoreticians have to develop themselves andthey are thus all autodidacts, whether they stem fromthe circles of university graduates or the proletariat. Theobject of study is the proletariats own praxis, its role inthe production process, its role in the class struggle.Only from this praxis can theory, can the self-con-sciousness of the proletariat arise.

The world saving unity of science and labor is there-fore not to be understood as university graduates pass-ing on to the people knowledge which they have re-

ceived in bourgeois lecture halls. It is rather each of ourco-fighters who is capable and has the opportunity,

whether university graduates or proletarians, participat-ing in proletarian praxisas combatants or at the veryleast by researching itin order to draw from it newscientific knowledge that will then reciprocally influ-ence proletarian praxis by making it more fruitful.72

Lenin agreed with thisindeed he quoted from thearticle in One Step Forward, Two Steps Backand also

with Kautskys stress on the importance of a Marxist partyrallying all those oppressed under capitalism.73WhereKautsky was primarily concerned with the petty bour-geoisie and peasantry, Lenin had already generalized the

point in What Is to Be Done?INTERNATIONAL SOCIALIST REVIEW


11/13


12/13

48

ence in the Jewish working class, Jewish social democraticgroups across Galicia left the PPSD to form the Jewish So-cial Democratic Party of Galicia (JSDP) on May Day1905. Grossman was its founding secretary.

As the new partys theorist, Grossman generalized hisown and the JSDPs experience in a pamphlet onBundism in Galicia.

Party consciousness is the multi-faceted expression ofthe proletariats class interests and the most far-reaching

interpretation of conclusions drawn from the objectivetrends of real social development. Workers parties donot always fulfil this requirement (as evidenced by thePPSD). Both the character and the content of collectiveparty thought remain directly dependent on the partic-ular partys adjustment to the very working class whoseexpression it should be.

.The closest possible adaptation of the party or-ganization to the historical forms of the Jewish prole-tariats conditioncould only be achieved through themutual organic growth of the party organization andthe workers movement itself, just as the latter hasgrown out of capitalist society.83

His assessment, like Lenins theory of the party, drew

on the orthodoxy of Second International Marxism, sys-tematically expressed by Kautsky.84

There is one specific story about Grossmans agita-tional activities in Galicia that must be included in aDeutscher Lecture.

Chrzanw, about 45 kilometers from Krakw, wasdominated by the towns Jewish bosses. Half of the popu-lation of around 6,000 was Jewish, many of them Khas-sids, members of fanatical Jewish sects. One of the mainindustries was printing. Many workers labored for fifteenhours a day, six days a week. Their bosses controlled localpolitical life, through the municipal council, and religiouslife, through the kehile(the local religious administration).

Paragons of the community like these did not appreciate

outsiders whose social democratic agitation disrupted theestablished order. In early June 1906, they expelled twoJSDP members from the town. Soon, Henryk Grossmancame to give heart to the local comrades. Among the tra-ditionally clothed inhabitants, he was easy to identify: awell-dressed, middle class, young gentleman. Incited byKhasidic zealots a large mob roughed him up and trashedthe rooms of the recently established JSDP affiliate.

Afterwards, the JSDP produced a leaflet that coun-

tered the arguments of the Chrzanw worthies that Jew-ish socialists wanted to organize pogroms, as in Russia. Infact who took the Jews side in Russia and who defendedthem, if not the socialists? The local bosses were the ones

who had instigated a pogrom, against the socialists.Grossman also took legal action over the assault. He won,demonstrating that the parochial despots were not all-powerful and turning the affair into a publicity coup forthe JSDP. Christina Steads short story The AzhdnovTailors is based on this incident.85

Isaac Deutscher was born in Chrzanw to a familywhich ran a printing firm in 1907. His father was a Khas-sid.

Although he moved to Vienna at the end of 1908,Grossmans close association with the JSDP continueduntil at least 1910. For the period immediately beforeand during World War I, no evidence has come to lightof political involvement, although his publications duringthe period give hints of his continuing Marxist views. TheGerman-Austrian Social Democratic Party had opposedthe existence of the JSDP from the start. So joining it wasnot an attractive proposition.

In 1919 or 1920, when Grossman joined the Commu-nist Workers Party of Poland (KPRP), if not before, headopted a package of Leninist politics, which included ele-ments of his earlier political outlook, notably his belief that

socialists should be involved in building revolutionary or-INTERNATIONAL SOCIALIST REVIEW

Anti-fascist fighters in Spain. Impressed by Russias support for Republican Spain, Grossman became a Soviet fellow-traveler


13/13


ganizations. Grossman was, between 1922 and 1925, thesecretary and then the chairperson of the Peoples Univer-sity (PU) in Warsaw. This educational institution was oneof the partys most important fronts, as the KPRP was asemiclandestine organization. The PU organized aboutforty lectures a month, each attended by fifty to three hun-dred people, and programs of talks for trade unions. Itsupported a publishing program and managed several

buildings, including a cinema. Through PU activities,communists involved in different areas, unionists, stu-dents, activists in campaigns could come together legally.

In 1925, after a series of arrests and periods in prison,the Polish authorities forced Grossman into a qualifiedexile. He took up a post at the Marxist Institute for SocialResearch in Frankfurt am Main and was now doubly in-sulated from conservatizing pressures. On the one hand,his well-paid post at the Institute meant that he was notfinancially dependent on either a more conventional,bourgeois institution or a political organization with aline. While he lived in Germany, he remained a supporterof the Communist International and Lenins theory of the

party. He was politically engaged, a close fellow-travellerof the Communist Party of Germany (KPD) and an ad-mirer of the Soviet Union. In 1932, he returned from astudy tour of the USSR starry-eyed. Yet, in order to avoidprovoking the German and Polish authorities, he did not

join the KPD. So he was not, on the other hand, subjectto the partys discipline as it imposed the new Stalinist or-thodoxies. We have seen that Grossman defended Marxsanalysis of the anatomy of capitalism against the distor-tions that became the Stalinist line in economics.

Grossmans work in economic theory, from 1919 tohis death, embodied commitment to working class self-emancipation, recognition that socialists need to organize

politically for that goal, and insights opened up by thesuccess of the Bolshevik revolution. The subordination ofCommunist Parties to the interests of the rising Russianbureaucracy created a contradiction between the funda-mentals of Marxist politics and his loyalty to the Com-intern and the Soviet Union. Consequently, professionaland amateur mouthpieces of Stalinism distorted and de-nounced Grossmans best-known work. For a period, heresolved the contradiction by reestablishing a consistencybetween his own political perspectives and the classicalMarxism that was the basis for his theoretical insights.86

The disaster of the Nazis victory in 1933 and Gross-mans accurate assessment that the tactics of the KPD, the

Comintern and the Russian leadership had failed to buildan effective opposition to the Nazis rise to power led himto explore dissident Communist analyses of what had gonewrong. He recommended Trotskys The German Catas-trophe to Paul Mattick. This was not, however, a decisivelyTrotskyist moment as Grossman was apparently closer tothe Socialist Workers Party of Germany (SAP). For a periodin 1934 and 1935, there were meetings, which discussedrevolutionary politics and included the SAP leaders PaulFrlich and Jakob Walcher at Grossmans place in Paris.

There was a sharp contrast between Grossmans atti-tude to politics and that of Max Horkheimer, who had be-come the Institutes director during the early 1930s.

Grossman appreciated Horkheimers work on philosophy.

But they were published in German in the Institutesrather inaccessible journal, even after it had gone intoexile, first in Geneva, then New York. Grossman suggestedin 1937 that the essays be published as a book, for a wideraudience. As in the natural so in the social sciences. Re-ally, from an activist standpoint, you should be interestedin confronting broad layers of young people. One shouldnever forget that the victory of Cartesianism was not sim-

ply achieved through the power of pure thought but wassupported in the university by the fists and clubs of Dutchstudents, who answered the brutal force of scholasticismwith the similar force of their fists!87

Apparently influenced by Russian support for Repub-lican Spain during the civil war, Grossman around 1937sadly again became a fellow-traveller of the Soviet Unionand an uncritical supporter of Stalins foreign policy. Hecontinued to engage in political activities that he mistak-enly believed expressed the perspective that informed hisresearch. In 1938, he moved to New York and, duringand after the war, was involved in groups associated withthe KPD.

On May Day 1949, a few months after arriving ineastern Germany to take up a professorial chair in politicaleconomy at the University of Leipzig, he signed up for theSociety for German-Soviet Friendship. On June 9, he be-came a member of the Socialist Unity Party (SED), whichruled Communist East Germany, under the supervision ofStalins regime in Russia.88 Nevertheless Grossman still ad-hered not only to the Marxist perspective that it is a re-sponsibility of socialists to be politically active, but also tohis own contributions to Marxist theory, even when thesecontradicted Stalinist orthodoxies.

Already ill for months, he died on November 24,1950. So he was not affected by the SED campaign from1949 that finally subordinated all institutions, notablythe unions and universities, to the Stalinist state. Theregime targeted, in particular, party members who hadbeen in western exile during the Nazi dictatorship.

With the benefit of hindsight, but also from the per-spective of some of his Marxist contemporaries, we canrecognize weaknesses and contradictions in Grossmanschoices and actions. In practice, the Stalinist organiza-tions in which he placed his faith undermined rather thanadvanced workers interests. There is, nevertheless, muchto identify with in his Marxism and his political career.

In 1946, Henryk Grossman explained his revolutionarysentiment to Christina Stead: I feel as if I saw a dangerousbadly made deadly machine running down the street, when

it gets to that corner it is going to explode and kill everyoneand I must stop it: once you feel this it gives you greatstrength, you have no idea there is no limit to the strengthit gives you.89We can draw strength from Grossmans sys-tematic account of the contradictions at the heart of capi-talist production and some important features of his politi-cal and organizational commitments in our own efforts torealize the project of working class self-emancipation.

References are available in the online edition

49

economic crisis and the responsibility of socialists isr 68 published

Documents