Correspondence on Crisis Theories and Decadence, Part 1

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IR105, 2nd Quarter 2001

We are publishing below a letter that we have received from one of our close contacts, in disagreement with our position on the economic foundations of capitalism’s decadence. The letter is followed by our reply, and we will publish the second part of this correspondence in the next issue.

The Method of Capital

a)   General Considerations

One of the supposedly most telling criticisms Luxemburg makes about Capital is that, since it is an incomplete work, it is necessarily a flawed one. Though it is true that Capital is unfinished insofar as Marx clearly intended to extend it further, what he did write is, with Engels’ assistance, in its essentials, a unified, coherent and consistent analysis. [1] This becomes apparent if you grasp that Marx’s theory of crisis is based uniquely on the tendency of the rate of profit to fall. What critics such as Luxemburg fail to grasp is that Marx had already worked out the contradictions of capitalist accumulation prior to writing Capital in the collection later known as the Theories of Surplus Value.

In fact, to argue that Capital has such serious deficiencies as Luxemburg does is to reduce Marx’s analysis to a mere description rather than a critique of capitalist political economy, that is, to fall into an empiricist perspective.[2] It means that Luxemburg does not understand the nature of the method of presentation Marx uses in Capital. This is borne out by her inability to heed Marx’s warning that “it may appear as if we have before us an a priori construction (Karl Marx, Capital Vol. 1, trans. Ben Fowkes, Penguin Books, Harmondsworth (1976), p102). She cannot grasp that Marx chose the particular method of presentation he did for Capital so as to enable the proletariat to pierce through the world of appearances, of commodity fetishism that the capitalist relations of production necessarily create; so that the basic contradictions, the “real movement can be appropriately presented (ibid.).

This method “abstracts from all the less essential and continuously changing surface phenomena of the market economy” (Paul Mattick, ‘Value and Capital’, Marxism: Last Refuge of the Bourgeoisie, Merlin Press, London (c.1983), p74). Capital is therefore not intended to “tell the whole story of capitalistic development (ibid., p.75) or “to predict the actual course of capitalist development” (ibid., p.94), but to “lay bare the dynamics of that development” (ibid., p.74); that is, it reveals the inherent contradictions of capitalist accumulation from the perspective of the revolutionary transformation of society, from the point of view of the totality.

Capital does NOT consist of a series of progressively detailed descriptions of concrete capitalist reality, analogous to a series of photographs of successively greater magnification. Although explanations in Capital proceed from those of a more abstract and general nature to those of a more concrete and particular one, this is not a simple linear progression; rather at each stage, on the basis of simplified conditions, a provisional analysis is made. At a subsequent stage this provisional analysis is extended and concretised. The levels therefore do not contradict either each other or empirical capitalist reality, as they might seem if simply compared [3], as Luxemburg mistakenly does. Marx removes the apparent contradictions between the different levels in the following way. First, he draws all the logical conclusions that follow on the basis of the assumptions of the lower level. By then showing that “these conclusions lead to a logical absurdity (I.I. Rubin, Essays on Marx’s Theory of Value, Black Rose Books, Montreal (1975) p.248) he thereby demonstrates that the “analysis is not yet finished and has to be continued further (ibid.); that is, the previous assumptions need to be modified to remove the contradictions. These modified assumptions define the next level. Examples of this in Capital are the transition from the value of commodities to the value of labour-power in Chapter 4 of vol.1, and the transition from different rates of profit in different spheres of production to the formation of the average rate of profit in Chapter 8 in vol.3.

The impossibility of surplus value in Chapter 4 of Volume 1, and the possibility of different profit rates in Chapter 8 of Volume III, do not serve as necessary links for his constructions, but as proofs of the opposite. The fact that these conclusions lead to a logical absurdity shows that the analysis is not yet finished and has to be continued further. Marx does not determine the existence of different profit rates, but on the contrary, the inadequacy of any theory which is based on such a premise (ibid.).

Fundamental to an understanding of Marx’s method is the distinction between the ‘inner’ or ‘general’ nature of capital [4] and its empirical and historical reality; the “general and necessary tendencies” (Marx, op.cit. p.433) as distinct from the “forms of their appearance (ibid.). To fail to grasp this crucial difference risks a headlong flight into empiricism, an acceptance of mere appearances for the truth. Conversely, ignoring the “necessary links” between this inner nature and the forms of appearance turns Capital into a mere abstract ideal divorced from reality.

There is nothing mystical or scholastic about this distinction; Marx clearly regarded it as vital to an understanding of capitalist accumulation.

…a scientific analysis of competition is possible only if we can grasp the inner nature of capital, just as the apparent motions of the heavenly bodies are intelligible only to someone who is acquainted with their real motions, which are not perceptible to the senses” (ibid.).


b) Marx’s Reproduction Schemes, the Crisis and the Falling Rate of Profit

In his reproduction schemes Marx merely intends to show the reproduction of total capital in its fundamental form; they lay “no claim to presenting a picture of concrete capitalist reality (H. Grossmann, quoted in Paul Mattick, ‘Luxemburg versus Lenin’, Anti-Bolshevik Communism, Merlin Press, London (1978), p.37).

But the essential, important point is seen clearly from these reproduction schemes: for production to expand and steadily progress given proportions must exist between the productive sectors; in practice these proportions are approximately realised; they depend on the following factors: the organic composition of capital, the rate of exploitation, and the proportion of surplus value which is accumulated (Anton Pannekoek, ‘The Theory of the Collapse of Capitalism’, Capital and Class 1, London (Spring 1977), p.64).

They are NOT intended to reveal the cause of the crisis. The real cause of the crisis is investigated at a later stage in Marx’s analysis.

Neither the possibility of overproduction nor the impossibility of overproduction follows from the schemas themselves. What must be remembered is that these schemas are only a particular stage, represent a certain level of abstraction, in the development of Marx’s theory. The production process and the circulation process, the problem of production and realisation, have to be seen within the total process of capitalist production as a whole...” (David S. Yaffe, ‘The Marxian theory of crisis, capital and the state’, Economy and Society, vol.2 no.2, p.210).

Marx explains the falling rate of profit as a consequence of the unity of the production, circulation and distribution of capital, i.e., the “capitalist accumulation process has three distinct but inter-related moments: extraction of surplus value; realisation of surplus value; capitalisation of surplus value (‘Correspondence: Saturated Markets & Decadence’, Internationalism 20, p.19). He explains the capitalist crisis uniquely in terms of the falling rate of profit because this embodies the whole process of capitalist accumulation. He shows that, eventually, this causes a crisis because of the overproduction of capital. Moreover, this overproduction of capital is not absolute or permanent, but relative to a given rate of profit and recurrent.

Periodically, however, too much is produced in the way of means of labour and means of subsistence, too much to function as means for exploiting the workers at a given rate of profit. Too many commodities are produced for the value contained in them, and the surplus-value included in this value, to be realised under the conditions of distribution given by capitalist production, and to be transformed back into new capital, i.e. it is impossible to accomplish this process without ever-recurrent explosions” (Karl Marx, Capital vol.3, p.367, trans. David Fernbach, Penguin Books, Harmondsworth (1981).

c) Capital and the Historical Evolution of Capitalism

To understand how the unfinished and abstract analysis of Capital can be applied to the historical evolution you need to grasp the following. First, that the abstract analysis of Capital is applicable to all phases of capitalism:

Marx’s formulas deal with a chemically pure capitalism which never existed and does not exist anywhere now. Precisely because of this, they revealed the basic tendency of every capitalism but precisely of capitalism and only of capitalism” (Leon Trotsky, quoted in Raya Dunayevskaya, Marxism and Freedom: From 1776 Until Today, Pluto Press (1975), p.132).[5]

Secondly, that:

 Although the actual crisis has to be explained out of the real movement of capitalist production, credit and competition, it is the general tendencies of the accumulation process itself and the long-term tendency of the rate of profit to fall that form the basis of that explanation” (D.S. Yaffe, op. cit., p.204).

Lastly, that this “real movement of capitalist production, credit and competition” cannot be reduced to pure economics, but needs to be seen from the viewpoint of the evolution of capitalism as a whole.

Moreover, the crisis cannot be reduced to ‘purely economic’ events, although it arises ‘purely economically’, that is, from the social relations of production clothed in economic forms. The international competitive struggle, fought also by political and military means, influences economic development, just as this in turn gives rise to the various forms of competition. Thus every real crisis can only be understood in connection with social development as a whole” (Paul Mattick, ‘Marx’s Crisis Theory’, Economic Crisis and Crisis Theory, Merlin Press, London (1981), p.76).

Herein lies the great contribution of Luxemburg to the Marxism. Even though her economic theory is seriously flawed, by proceeding from the viewpoint of the totality, Luxemburg arrives at the insight that:

Imperialism is not the creation of one or any group of states, but is the product of a particular stage of ripeness in the world development of capital, an innately international condition, an indivisible whole, that is recognisable only in all its relations, and from which no nation can hold aloof at will (Rosa Luxemburg, ‘The Junius Pamphlet’, quoted in Nation or Class? International Communist Current, (autumn 1979), p.25).

The nature of capitalist decadence and the crisis theories of Marx, Luxemburg and Grossmann

The lynchpin to understanding the decadence of capitalism is, as Bukharin stresses in Imperialism and World Economy[6], the formation of the world economy. Thus the decadence of capitalism is synonymous with the creation of the world economy.

The existence of a world economy, implies the intensification of the international division of labour and commodity exchange to the point where whatever happens at one point in the economic chain directly influences all the other points. International competition levels prices and conditions of production, and tends towards the equalisation of the rate of profit at the international level, (though of course this is always modified by the existence of capitalism in its nation-state form). The industrialised countries are now so inter-dependent in terms of trade and investments, that crises are a phenomenon that spreads like wildfire from one to another. As for the under developed areas, they have no internal dynamic, and are totally circumscribed by the formal domination imposed on them by capitalism. The existence of the world economy doesn’t mitigate, rather it intensifies imperialist antagonisms, and its consequences are world economic crises and world wars.” (‘The Meaning of Decadence’, Revolutionary Perspectives 10 (Old Series), p.12).

Even though the creation of the world economy results in the “hellish cycle of crisis-war-reconstruction-new crisis (‘The Platform of the ICC’, in Platform and Manifesto, International Communist Current, Winter (1980), p.3), this does not mean that decadence is characterised by a total halt to the growth of the productive forces. Rather, “Since the beginning of the century we have witnessed a massive arrestation of the growth of the productive forces, compared with what is objectively possible, given the level of scientific knowledge, technical progress and level of proletarianisation in society” (Revolutionary Perspectives 10 (Old Series), op. cit., p.7).

This is of course in keeping with the outline of the decadence of class societies in Marx’s famous Preface to A Contribution to the Critique of Political Economy.

During the reconstruction period after World War II, many workers, mainly those in the Western countries of course, did experience substantial improvements in their material conditions. But in no way could these improvements in living conditions be considered real reforms because of the material costs associated with them. That is, these improvements occurred because of the massive destruction of the productive forces during World War II, and their profound shackling during the ‘Cold War’. During reconstruction capitalism was destroying humanity’s future in advance at the same time as it was preparing for even greater destruction in the future.

The material reality of decadence therefore gives the lie to the idea of a final, death crisis. And Luxemburg’s and Grossmann’s crisis theories are unquestionably those of the death crisis as they both set an absolute economic limit to capitalist accumulation; that is, they predict that, eventually, capitalism must breakdown because accumulation becomes literally impossible. (Specifically, Luxemburg argues that capitalism is prone to crisis because it is impossible to realise surplus value within capitalism [7]; Grossmann that crises occur because capitalist accumulation inevitably leads to an absolute lack of surplus value [8].)

It is true that Luxemburg and Grossmann believe that well before capitalist accumulation becomes impossible, the intensification of the class struggle resulting from growing economic difficulties would have disrupted capitalist accumulation anyway[9]. Nonetheless, as they still see an absolute economic limit to capitalist accumulation, they argue that capitalism would eventually breakdown regardless of the class struggle.

The virtual zero growth of capitalism between the World War I and World War II at the time seemed to vindicate both Luxemburg’s and Grossmann’s theories as they both tend to identify the decadence of capitalism with a permanent economic crisis. However, the expansion of capitalism after World War II is the strongest possible refutation of these theories. According to Luxemburg, solvent pre-capitalist markets, without which capitalist accumulation is impossible, were exhausted globally by World War I. And it is clear that there has since been an ongoing destruction of these markets. Logically, capitalist growth CANNOT thereafter attain let alone surpass that reached prior to World War I. Seen in the light of her theory, it is therefore inexplicable that capitalist growth after World War II reached substantially greater levels than that before World War I, even taking into account unproductive capitalist production, as the ICC themselves admit. As Grossmann shares Luxemburg’s mechanistic idea of an absolute economic limit to capitalist accumulation, logically his theory can account for the expansion of capitalism after World War II ONLY if capitalism was still a progressive system, that is, it was NOT yet decadent.

The impossibility of real reforms and national self-determination, the imperialist nature of all nations, the rise of state capitalism, the reactionary nature of all factions of the bourgeois and the world-wide nature of the communist revolution; in short, the decadence of capitalism, CANNOT be reduced to the impossibility of capitalist development as Luxemburg’s and Grossmann’s crisis theories imply, but “can only be understood in connection with social development as a whole (Paul Mattick, ‘Marx’s Crisis Theory’, Economic Crisis and Crisis Theory, Merlin Press (1981), p.76).

Thus the permanent crisis DOES NOT mean a permanent economic crisis, that it is only in relation to “social development as a whole” that one can talk about a permanent crisis; but this is exactly what Luxemburg’s and Grossmann’s crisis theories imply.

The actual course of capitalist development contradicts the crisis theories of Luxemburg and Grossmann. The attempt to reconcile these theories with the actual evolution of capitalism can but lead to explanations that are ad hoc, inconsistent and contradictory. In particular, it is a flagrant error to argue that the view that there is an absolute economic limit to capitalist accumulation is a non sequitur to these theories. The Marxist view of decadence as a fetter on the productive forces and the notion of an absolute economic limit to capitalism are totally incompatible; you cannot coherently subscribe to both ideas at the same time.

Luxemburg’s and Grossmann’s distortion of Capital

Because the world economic crisis coincides with the geographical division of the whole world, it could appear that a lack of external markets is the cause of this crisis. Luxemburg accepts this appearance for reality and proceeds to revise [10] Capital in the light of her empiricist vision. In particular, after examining Marx’s schema of expanded reproduction, she concludes that capitalist accumulation inevitably gives rise to an absolute excess of surplus value. [11]

The problem which seemed to have been left open was who was to buy the products in which surplus value was contained. If Departments I [means of production] and II [means of consumption] buy from each other more and more means of production and means of subsistence this would be a pointless circular movement from which nothing would result. The solution would lie in the appearance of buyers situated outside capitalism…” (Pannekoek, op.cit., p.64).

However, this is a “pointless circular movement” to Luxemburg only because of her profound misunderstanding of the process of capitalist accumulation; she constructs her ‘proof’ upon some of the most elementary theoretical errors ever made by a revolutionary Marxist. (This criticism is made by Left-wing Social Democrats such as Lenin and Pannekoek in their contemporary reviews of Luxemburg’s, The Accumulation of Capital.)

Luxemburg’s basic mistake is that she takes the total capitalist as an individual capitalist. She underrates this total capitalist. Therefore she does not understand that the process of realisation occurs gradually. For the same reason she portrays the accumulation of capital as an accumulation of money capital.” (Nicolai Bukharin, Imperialism and the Accumulation of Capital, p.201-202).

Luxemburg confuses the total capitalist with the individual capitalist because she carries over to Marx’s scheme of expanded reproduction the assumption from his scheme of simple reproduction that the “total amount of variable capital, and hence the also the consumption of the workers, must remain fixed and constant” (Paul Sweezy, The Theory of Capitalist Development: Principles of Marxian Political Economy, Monthly Review Press, New York (1964), p.204).

But to except such an assumption means to exclude expanded reproduction from the very beginning. If, however, one has excluded expanded reproduction from the start in one’s logical proof, it naturally becomes easy to let it disappear at the end of it, for here one is dealing with the simple reproduction of a simple logical error.” (Bukharin, op.cit., p.166).

Luxemburg makes the incredible argument that the total surplus value to be accumulated has to be matched by an equal amount of money for its realisation to occur. [12]

 In each given moment, the total surplus value destined for accumulation appears in various forms: in the form of commodity, money, functioning means of production and labour-power. Therefore, the surplus value in money form should never be identified with the total surplus value.” (Bukharin, op.cit., p.180).

From this - as we believe - results the manner in which she explains imperialism. Indeed, if the total capitalist is equated with the typical individual capitalist, the first of course cannot be his own consumer. Furthermore, if the amount of gold is equivalent to the value of the additional number of commodities, this gold can only come from abroad (as it is obvious nonsense to assume a corresponding production of gold). Finally, if all capitalists have to realise their surplus value at once (without it wandering from one pocket to another, which is strictly forbidden), they need ‘third persons’, etc” (ibid. p.202).

However, even if she did succeed in showing that an excess of surplus value arose on the basis of this schema, she would prove NOTHING because she would be drawing conclusions that were “derived from a schema having no objective validity” (Paul Mattick, ‘Luxemburg versus Lenin’, Anti-Bolshevik Communism, Merlin Press (1978), p.38). That is, Luxemburg’s principal mistake is to think that Marx’s schema of expanded reproduction is supposed to portray concrete capitalism (ibid. p37).

In a reproduction scheme built on values, different rates of profit must arise in each department of the schema. There is in reality, however, a tendency for the different rates of profit to be equalised to average rates, a circumstance which is already embraced in the concept of production prices. So that if one wants to take the schema as a basis for criticising or granting the possibility of realising surplus value, it would first have to transformed into a [production] price schema.” (Henryk Grossmann, quoted in Paul Mattick, op. cit., p.37).

And this has the following consequences: “If one takes into account this average rate of profit, Rosa Luxemburg’s disproportionality argument loses all value, since one department sells above and the other under value and on the basis of production price the undisposable part of the surplus value may vanish.” (Paul Mattick, op.cit. p.38).

Superficially, Grossmann would seem to follow Marx’s falling rate of profit theory because he uses Otto Bauer’s schema, which has a rising organic composition of capital in both departments of social reproduction. However, the schema also assumes a fixed and constant rate of surplus value for the two departments; hence we have “two conditions which completely contradict and neutralise one another” (Rosa Luxemburg, op. cit. p.99), “an impossibility, nay an absurdity (Paul Mattick, ‘The Permanent Crisis’, Council Correspondence, Nov. 1934, No.2, New Essays, vol.1, 1934-1935, Greenwood Reprint Corporation, Westport, Connecticut (1970), p.6). (Though these assumptions were adequate for showing the falseness of Luxemburg’s so-called realisation problem.)

Under these assumptions, eventually, “there will reach a point where the organic composition of total composition is so large and the rate of profit so small, that to enlarge on the existing constant capital would absorb the whole of the surplus value produced (The Economic Foundations of Capitalist Decadence’, Revolutionary Perspectives 2 (Old Series), p.27).  Thus the crisis results from an absolute lack of surplus value.

In Grossmann’s analysis, therefore, the fall in the rate of profit is only an accompanying factor, not the cause of the crisis.

How could a percentage, a pure number such as the rate of profit produce the breakdown of the real system? - A falling rate of profit is thus only an index that reveals the relative fall in the mass of profit.” (Grossmann, op.cit. p.103).

Though his argument is logically impeccable, it proceeds from false premises. Grossmann is unaware that, in using Bauer’s schema, he is committing the same fundamental error that he and Paul Mattick correctly criticise Luxemburg for: he derives conclusions from a schema that has no objective validity. For if one wants to take Bauer’s scheme as a basis for criticising or granting the possibility of an under-accumulation of capital, one would have to transform it into a production price schema. Grossmann fails to realise the importance of the fact that, in volume III of Capital, Marx analyses the fall in the rate of profit after he investigates the transformation of values into prices of production; namely that as the latter is responsible for the formation of the average rate of profit, capitalism’s tendency towards crisis cannot therefore be deduced independently of this process. What Grossmann overlooks is that Bauer’s schema, by virtue of its two contradictory assumptions, thereby excludes the average rate of profit; and that this consequently negates any conclusions he draws.

In addition, not only does Grossmann depart from Marx in ignoring the consequences of the average rate of profit, he also does so through his view that the capitalists are compelled to increase constant capital owing to the “growth of capital demanded by technology (Pannekoek, op.cit. p.69). Grossmann argues that, “when the rate of profit becomes less than the rate of growth demanded by technical progress then capitalism must break down (ibid., p.69). This concept, which is foreign to both Capital and Marxism in general, furnishes Grossmann with the principal reason why capitalist accumulation advances inevitably towards its collapse. In his theory, therefore, the falling rate of profit is not the cause of the crisis, merely an accompanying factor. He draws the logical conclusion that capital is exported because it is impossible to use it at home rather than because of higher profits abroad (ibid., p.73).

Luxemburg’s and Grossmann’s conclusions about the cause of the capitalist crisis and the historical tendency of capitalist accumulation are therefore meaningless since they are derived from schemas that have no objective validity. These schemes are worthless for an analysis of these matters since they are based on assumptions that are historically and logically absurd for their resolution.

These erroneous crisis theories stem from fragmented and one-sided views of capitalist accumulation. Whereas Marx explains that the crisis arises from the unity of the production, circulation and distribution of capital, Luxemburg and Grossmann separate, respectively, the circulation of capital, and the production of capital from the capitalist production process as a whole.

 Luxemburg’s revision of Marx’s economics is cruder and more extreme than Grossmann’s. It is cruder because of the elementary mistakes she makes about capitalist accumulation; it is more extreme because she sees the fundamental barrier to capitalist accumulation being outside the capitalist economy whereas he at least agrees with Marx that the “true barrier to capitalist production is capital itself” (Karl Marx, Capital vol. III, p.358). Though Luxemburg succumbs to empiricism in her explanation of the contradictions of capitalist accumulation, she follows the Marxist method in analysing the historical development of capitalism from the viewpoint of the capitalist system as a whole. Rather than empiricism, Grossmann’s interpretation of the capitalist crisis reflects an idealist perspective. He argues that the real cause of the capitalist crisis is the mirror image of what it appears to be: the crisis appears as an overproduction of commodities, i.e., an absolute excess of surplus value, therefore the crisis is actually due to an absolute lack of surplus value. It is true that Grossmann has some insight into the method of Capital, but this insight is used to justify his idealist vision of capitalism.

Only Marx’s Capital explains the fundamental contradictions of capitalist accumulation, which underpin the historical evolution of capitalism. Luxemburg’s and Grossmann’s crisis theories explain neither.

Only Marx’s analysis explains the fundamental contradictions of capitalist accumulation and thus the economic foundations of capitalist ascendance and decadence.

Political Consequences

We would say that any errors on the level of economics tend to reinforce errors deriving from the totality of a group’s politics. Any incoherence in a group’s analysis can open the door to confusions of a more general kind; but we are not dealing with irrevocable fatalities - an analysis of the economic foundations of decadence is part of a more global proletarian standpoint, a standpoint which demands an active commitment to ‘change the world’ - the political conclusions defended by revolutionaries do not derive in a mechanical way from a particular analysis of economics (‘Marxism and Crisis Theory’, International Review 13, p.35).

In the light of this, I draw the following conclusions.

The principal strength of the analyses of imperialism of Bukharin [13], Luxemburg, Bilan, Paul Mattick [14], the FFCL and the ICC is their recognition of the global nature of capitalist decadence. Conversely, the principal weakness of Pannekoek’s, Lenin’s, the Bordigist’s and the IBRP’s analyses of imperialism is their tendency, in varying degrees, to view capitalist development from the point of view of each nation taken in isolation, to view the world economy as a mere sum of separate national economies. In other words, their analyses of imperialism are partially influenced by the erroneous mechanical stages theory of Social Democracy.

 Luxemburg’s flawed economics encourages a tendency to see an absolute as opposed to a qualitative difference between ascendant and decadent capitalism. This is because in her theory the exhaustion of pre-capitalist markets is logically an impassable barrier to capitalist accumulation. The ICC, for example, sometimes finds it difficult to “see that the tendencies which brought about capitalist decadence don’t just conveniently stop at the beginning of the First World War (‘The Material Basis of Imperialist War: A Brief Reply to the ICC’, Internationalist Communist Review 13, p.13).

Grossmann’s crisis theory agrees with Luxemburg’s that there is an absolute economic limit to capitalist accumulation. But as his theory argues that this absolute limit is entirely due to internal capitalist factors, then what the expansion of capitalism after World War II logically implies is that capitalism was still in its ascendant period. Hence his theory encourages a tendency to see mere quantitative differences between ascendant and decadent capitalism.

However, above all else it is the rigour and coherence of a current’s political program that is the determining influence on the clarity and insight of its analyses. Thus the ICC’s flawed economics has a much less adverse effect on the clarity of their analysis than it otherwise would owing to the strength of their political program, a program that draws out all the consequences of capitalist decadence.

Conversely, it is the political programs of the IBRP and, to a greater degree, the Bordigists, which embody incoherence, ambiguity and error. These weaknesses reflect the inability of the former current to draw out all the consequences of decadence [15] and that of the latter to recognise that capitalism as a global system is decadent at all [16]. These currents, particularly the Bordigists, therefore tend to see mere quantitative differences between ascendant and decadent capitalism.



[1] Marx did hold contradictory views about when decadence would occur. One finds some statements that suggest he believed the crises in his time were the mortal crises of capitalism. Others that suggest he believed it would be decades away. He also thought that the workers could peacefully come to power in a few countries. But this does not diminish the validity of his method; Marx’s method transcends the limitations of Marx the nineteenth century revolutionary.

[2] Rosa Luxemburg, ‘The Questions At Issue’, The Accumulation of Capital: An Anti-Critique, published with Nicolai Bukharin, Imperialism and the Accumulation of Capital, trans. Rudolph Wichmann, Monthly Review Press, New York (1972).

[3] Henryk Grossmann, The law of accumulation and breakdown of the capitalist system: being also a theory of crisis, translated and abridged by Jairus Banaji, Pluto Press, London (1992) and I.I. Rubin, Essays on Marx’s Theory of Value, Black Rose Books, Montreal (1975).

[4] Roman Rosdolsky, ‘Appendix II: Methodological comments on Rosa Luxemburg’, The Making of Marx’s Capital, Pluto Press, London (1980), pp. 61-72.

[5] Though Trotsky is referring specifically to the reproduction schemes in Volume II of Capital, the point that is made can be applied to Capital as a whole.

[6] Nicolai Bukharin, Imperialism and World Economy, Merlin Press, London (1972).

[7] Rosa Luxemburg, ‘Imperialism’, The Accumulation of Capita: An Anti-Critique, p.145.

[8] Henryk Grossmann, op. cit., p.74-8.

[9] Rosa Luxemburg, op. cit., p.146-7. Henryk Grossmann, quoted in Introduction by Tony Kennedy, Henryk Grossmann, op. cit., p.20.


[10] Rosa Luxemburg remained a revolutionary Marxist despite her distortions of Marx’s economics.

[11]  ‘The Accumulation of Contradictions (or The Economic Consequences of Rosa Luxemburg)’, Revolutionary Perspectives 6 (Old Series), pp.5-27.

[12] Revolutionary Perspectives 6 (Old Series), op. cit., p.15.

[13] Prior to his political degeneration in the early 1920’s, as is already evident in Imperialism and the Accumulation of Capital.

[14] During the Cold War, Mattick’s analysis becomes clouded with ambiguities and inconsistencies.

[15] The IBRP attempt to justify this through their argument about the ‘autonomy’ of tactics from the political program as per the Preamble in ‘Theses on Communist Tactics for the Periphery of Capitalism’, International Communist 16.

[16] The dogma of the ‘Invariance of the Program’.

Life of the ICC: 


Heritage of the Communist Left: 

General and theoretical questions: