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In ‘Towards a Theory of Capitalist Crisis’ you describe a deep structural conflict within capitalism, in which you differentiate between crises that are caused by too high a rate of exploitation, which lead to a realization crisis because of insufficient effective demand, and those caused by too low a rate of exploitation, which cuts into demand for means of production. Now, do you still hold to this general distinction, and if so would you say that we are now in an underlying realization crisis, masked by expanding personal indebtedness and financialization, due to the wage repressions that have characterized capitalism over the last thirty years?
Yes. I think that over the last thirty years there has been a change in the nature of the crisis. Up to the early 1980s, the crisis was typically one of falling rate of profits due to intensifying competition among capitalist agencies, and due to circumstances in which labour was much better equipped to protect itself than in the previous depressions—both in the late nineteenth century and in the 1930s. So that was the situation through the 1970s. The Reagan–Thatcher monetary counter revolution was actually aimed at undermining this power, this capacity of the working classes to protect themselves—it was not the only objective, but it was one of the main objectives. I think that you quote some adviser of Thatcher, saying that what they did was …
… to create an industrial reserve army; exactly …
… what Marx says they should do! That changed the nature of the crisis. In the 1980s and 1990s, and now, in the 2000s, we are indeed facing an underlying overproduction crisis, with all its typical characteristics. Incomes have been redistributed in favour of groups and classes that have high liquidity and speculative dispositions; so incomes don’t go back into circulation in the form of effective demand, but they go into speculation, creating bubbles that burst regularly. So, yes, the crisis has been transformed from one of falling rate of profit, due to intensified competition among capitals, to one of overproduction due to a systemic shortage of effective demand, created by the tendencies of capitalist development.
There are two different questions here: one concerns an appreciation of the flexibility of capitalist development and the other is the recurrence of patterns, and the extent to which these are determined by contingency or necessity. On the first, the adaptability of capitalism: this is partly related to my personal experience in business, as a young man. Initially I tried to run my father’s business, which was relatively small; then I did a dissertation on my grandfather’s business, which was bigger—a medium-sized company. Then I quarrelled with my grandfather and went into Unilever, which in terms of employees was the second-largest multinational at the time. So I had the luck—from the point of view of analysing the capitalist business enterprise—of going into successively larger firms, which helped me understand that you cannot talk about capitalist enterprises in general, because the differences between my father’s business, my grandfather’s business and Unilever were incredible. For example, my father spent all his time going to visit customers in the textile districts, and studying the technical problems that they had with their machines. Then he would go back to the factory and discuss the problems with his engineer; they would customize the machine for the client. When I tried to run this business, I was totally lost; the whole thing was based on skills and knowledge that were part of my father’s practice and experience. I could go around and see the customers, but I couldn’t solve their problems—I couldn’t even really understand them. So it was hopeless. In fact, in my youth, when I used to say to my father, ‘If the Communists come, you are going to be in trouble’, he said, ‘No, I’m not going to be in trouble, I’ll continue to do what I’m doing. They need people who do this.’
When I closed my father’s business, and went into my grandfather’s, it was already more of a Fordist organization. They were not studying the customers’ problems, they were producing standardized machines; either the customers wanted them or they didn’t. Their engineers were designing machines on the basis of what they thought there would be a market for, and telling the customers: this is what we have. It was embryonic mass production, with embryonic assembly lines. When I went to Unilever, I barely saw the production side. There were many different factories—one was making margarine, another soap, another perfumes. There were dozens of different products, but the main site of activity was neither the marketing organization nor the place of production, but finance and advertising. So, that taught me that it’s very hard to identify one specific form as ‘typically’ capitalist. Later, studying Braudel, I saw that this idea of the eminently adaptable nature of capitalism was something that you could observe historically.
One of the major problems on the Left, but also on the Right, is to think that there is only one kind of capitalism that reproduces itself historically; whereas capitalism has transformed itself substantively—particularly on a global basis—in unexpected ways. For several centuries capitalism relied on slavery, and seemed so embedded in slavery from all points of view that it could not survive without it; whereas slavery was abolished, and capitalism not only survived but prospered more than ever, now developing on the basis of colonialism and imperialism. At this point it seemed that colonialism and imperialism were essential to capitalism’s operation—but again, after the Second World War, capitalism managed to discard them, and to survive and prosper. World-historically, capitalism has been continually transforming itself, and this is one of its main characteristics; it would be very short-sighted to try to pin down what capitalism is without looking at these crucial transformations. What remains constant through all these adaptations, and defines the essence of capitalism, is best captured by Marx’s formula of capital M–C–M’, to which I refer repeatedly in identifying the alternation of material and financial expansions. Looking at present-day China, one can say, maybe it’s capitalism, maybe not—I think it’s still an open question. But assuming that it is capitalism, it’s not the same as that of previous periods; it’s thoroughly transformed. The issue is to identify its specificities, how it differs from previous capitalisms, whether we call it capitalism or something else.
One point is that there is a very clear geographical dimension to the recurrent cycles of material and financial expansion, but you can see this aspect only if you do not stay focused on one particular country—because then you see a totally different process. This is what most historians have been doing—they focus on a particular country, and trace developments there. Whereas in Braudel, the idea is precisely that the accumulation of capital jumps; and if you don’t jump with it, if you don’t follow it from place to place, you don’t see it. If you stay focused on England, or on France, you miss what matters most in the development of capitalism world-historically. You have to move with it to understand that the process of capitalist development is essentially this process of jumping from one condition, where what you’ve termed the ‘spatial fix’ has become too constraining, and competition is intensifying, to another one, where a new spatial fix of greater scale and scope enables the system to experience another period of material expansion. And then of course, at a certain point the cycle repeats itself.
Both of these selectively held views rely on a fantasy that voters—that is, responsible voters, not the kind who fall prey to base desires—navigate a simple, unmediated relationship between what they like and what should be. Thus, judging by the frequency with which the argument is made, one of the best things Clinton supporters have going for them is the notion that Clinton’s unexpected challenges are due to a “likeability problem.” “I Used to Hate Hillary Clinton. Now I’m Voting for Her,” announces the headline of a Slate article by the liberal commentator Michelle Goldberg. Goldberg’s politics haven’t changed—they were and remain close to those of Sanders, she tells us. What changed between 2008, when she excoriated Clinton’s political sins, and today, was that her emotional attachments grew up:
For a progressive, how you reconcile conflicting truths about Clinton depends, to some extent, on how much you empathize with her. Supporting Clinton means justifying the thousands of concessions she’s made to the world as it is, rather than as we want it to be. Doing this is easier, I think, when you are older, and have made more concessions yourself. Indeed, sometimes it feels like to defend Clinton is to defend middle age itself, with all its attenuated expectations and reminders of the uselessness of hindsight.
“This is in support of Hillary?” a friend asked. Goldberg’s counterintuitive approach to political rhetoric—We’re the party of defeat!—is in fact the more or less official line of the Clinton campaign. Disciplined by the fetters of middle age, Goldberg narrates her march toward reason as a sentimental journey in which, through a growing identification with Clinton, she comes to like the way concession feels.
dying
History, we were told in the 1990s, was something that happened to other people. The recent past was littered with code-named police actions that, rendered pointless by the evaporation of the cold war, no longer even had the dignity of the unmentionable. Conservatives kept building monuments to the death of communism that no one wanted to visit. Liberals wanted to forget the whole messy business and gave themselves endless Oscars for movies about World War II. Only fools with sheaves of xeroxed newsletters thought they were smart enough to construct a narrative out of a deafening drone. The more distant past, upon inspection, turned out to be much the same, leading some to suspect that history had never happened at all. There were, however, exceptions to the rule: events taken to be unique in their world-shattering horror and exceptional people who had come near them and gotten away no longer quite themselves. We, too, could be exceptional: if we were good and listened hard, history could become something that happened, though only by proxy, to us. Every year on the Day of Remembrance, survivors came to Hebrew school and asked us to feel on our skin the licks of the Shoah’s eternal flame and to guard with our lives its redemption in the birth of a handsome nation. In history class in regular school, we learned nothing at all. And yet the past kept ghosting through like reruns.
lol
Once, when my parents were visiting, I broke this tacit compact on a drive to Philadelphia with my mother and her cousin Janet. Janet and her son had been in a heated email exchange about whether Israel was an apartheid state, and then, she said, his emails had simply stopped coming. “Well, and so we shall cease to speak of such things, and our generation shall rise,” I snapped from the back seat, like I was suddenly the Bible or something. Everyone was quiet; it isn’t nice to tell people they will be swept away by time.
My building is not very tall but it is wide, with wings folding out from the lobby like a parliament. Legally speaking it is a co-op; our landlord converted it in the 1990s in a real estate ploy, then bought and sublet nearly all the shares. When quarantine began, the world shrank to the building’s size and everyone became a mad housewife in their cabin fever. There were frenzies in the tenant WhatsApp thread: a package thief, tacos for 2L abandoned in the lobby. Chimney swifts were spotted on the roof of the haunted 19th-century institutional building — now a Seventh Day Adventist school, someday slated to be dwarfed by condos — across the street. Once someone saw turkey vultures. “Sure it wasn’t management?” someone else asked. It became clear that if rent continued to drain from the apartments, the neighborhood would wash away. We formed a committee and slipped flyers under doors. They came back covered in complaints. Upstairs a patch of black mold was growing in a baby’s room; it measured less than a square foot, so the housing inspectors couldn’t be bothered. I desperately wanted to learn everyone’s problems and names.
lol
There was Selma Gardinsky, a red diaper baby from Brooklyn transplanted to Boston by marriage, where she took a unionized office job and became an organizer in an attempt to catch the party’s eye. She left her husband “without so much as a backward glance” when the union offered her a position back in New York; there, she was recruited by the Communist Party and went to work for it for “the best ten years” of her life. “Whatever else we were or were not as Communists,” Gardinsky told Gornick, “we were not lonely.” There was Bernie Sanders, a socialist from a Brooklyn immigrant family who does not appear in Romance. He became the mayor of a small city in Vermont, then a senator, and finally ran twice for President. “I have cast some lonely votes, fought some lonely fights, mounted some lonely campaigns,” he wrote in 2015. “But I do not feel lonely now.” I don’t feel lonely anymore, but it isn’t nearly enough. An infinite amount of care seems necessary. While we gather our strength, the lucky ones among us will grow old.
god this makes me cry every time
These kinds of changes are often thought through the conceptual lens of ‘neoliberalism’. It’s worth describing what we might mean when we talk about neoliberalism, as the term – and imprecise uses of it – are all too quickly maligned. By neoliberalism, I mean a conscious, political project, undertaken to break the power of organised labour and develop new methods to extract profit from more and more of human social life, including from the legacy institutions of the welfare state. David Harvey describes it as the ‘gutting’ or ‘hollowing out’ of social programmes or social institutions.6 In its promise of breaking through the boredom of mid-twentieth century Fordism, it turns freedom in on itself. In promising freedom, it produces more coercion. As the philosopher, Byung-Chul Han puts it:
Neoliberalism represents a highly efficient, indeed an intelligent, system for exploiting freedom. Everything that belongs to practices and expressive forms of liberty – emotion, play and communication – comes to be exploited. It is inefficient to exploit people against their will. Allo-exploitation [exploitation carried out by other people] yields scant returns. Only when freedom is exploited are returns maximised.