Has Capitalism entered its Decadence since 1914?

 III. The national question before and after 1914

The national question before 1914

Another area where the theoretical framework of ‘decadence since 1914’ is in direct contradiction with the facts is that of the constitution and development of new capitalist nations. In effect, the ICC platform states that : “(…) in the ascendant phase of capitalism the nation represented the most appropriate framework for the development of capitalism, and the establishment of new nation states, by eliminating the constricting vestiges of pre-capitalist social relations, represented a step forward in the development of the productive forces on a world scale(…).” (1)

Certainly, the productive forces have developed with the industrial revolution that began in the countries of Western Europe and North America. However, were we witnessing “a step forward in the development of the productive forces on a world scale before 1914? Not at all, because the first Euro-American countries would limit this development to their geographical area and deindustrialize the rest of the world, destroying all potential for competing economic growth, as the study on the 250 years of capitalism (2) that we have republished clearly shows. To this we add the very telling graph below, whose data confirm this observation, since in 1750, 80% of industrial production was located in the world outside Western Europe and North America and only 20% in the latter two areas, whereas after a century and a half of ‘capitalist ascendancy’ (1750-1913), we are witnessing a spectacular geographical inversion in this distribution, as production had become almost exclusively concentrated in the Euro-American area (84%) to the detriment of the rest of the world (16%)! In other words, the development of productive forces following the industrial revolution, far from being “a step forward in the development of the productive forces on a world scale…”, remained confined to the Euro-American area to the detriment of the rest of the world. Once again, the reality is strictly the opposite of the idealistic postulates of the ICC. This divergence in geographical evolution is at the origin of the economic bi-polarization of the world between the so-called Developed Countries and what will later be called the Third World.

Graph 3.1 - Distribution of the Manufactured Production in the World (1750 - 1913)
Graph 3.1 – Distribution of the Manufactured Production in the World (1750 – 1913). Source: Les mondes insurgés, Altermanuel d’histoire contemporaine, Ed. Vuibert, p13. The data come from: Paul Bairoch, ‘International industrialization levels from 1750 to 1980’, published in The Journal of European Economic History, n°11, 2, 1982.

Such a geographical inversion in the distribution of manufactured production to the detriment of the Third World is not only relative but also absolute, since we are witnessing a real deindustrialization there before the First World War, as shown in the graph below.

Graph 3.2 - Level of Industrialization per Inhabitant (1750 – 1995)
Graph 3.2 – Level of Industrialization per Inhabitant (1750 – 1995); UK 1900 = 100. Source: Bairoch, P., 1997, Victoires et déboires. Ed. Folio, Volume III, p.860. 

To this first untruth about the “development of the productive forces on a world scale...”, the ICC states a second one by affirming that : “The most developed countries showed the way forward to the other coun­tries, whose lateness on the scene wasn’t necessa­rily an insurmountable handicap. On the contrary, the latter had the possibility of catching up or even overtaking the former. This was, in fact, almost a general rule…” (3)

Everything is wrong with this statement because the most developed countries before 1914 did NOT lead the way for other countries to the extent that they blocked the industrialization of the latter. This blockage therefore prevented any catch-up for any Third World country, a catch-up that was all the more compromised because the gap with the Developed Countries only widened before 1914 (see graphs 3.2 and 3.3).

Graph 3.3a - The catching-up of the Asian giants
Graph 3.3 – The catching-up of the Asian giants: China, India, Indonesia (1820 – 2015). Source: Milanovic, B., 2020, Le capitalisme sans rival. La Découverte, p.260. [GDP per inhabitant of China and India as percentage of Britain’s; GDP per inhabitant of Indonesia as percentage of Netherlands’; from the Industrial Revolution until our days. Sources: calculated from the Maddison Project (2018); GDP per inhabitant expressed at purchasing power parity, 2011.]

The development of the productive forces before 1914 shows a rule exactly opposite to that stated by the ICC and all the more so as it is after 1914 that we are witnessing a process of catching up by a good part of the Third World on the Developed Countries as shown in graph 3.4 … while the ICC platform decrees its absolute impossibility: “As capitalism entered its period of decline, the nation together with capitalist relations of production as a whole, became too narrow for the development of the productive forces.”! This is what we will now examine in detail.

Graph 3.4 - USA and China – Relative Part of the Global GDP per country (1950 - 2015)
Graph 3.4 – USA and China – Relative Part of the Global GDP per country (1950 – 2015). Source: Milanovic, B., 2020, Op. Cit. p.27.

The national question after 1914

In fact, the ICC’s theoretical framework on the national question is just as contrary to reality after as it was before 1914, since it states that: “The period of capitalist decadence is characterised by the impossibility of any new industrialised nations emerging. The countries which didn’t make up for lost time before World War I were subsequently doomed to stagnate in a state of total underdevelopment, or to remain chronically backward in relation to the countries at the top of the sandcastle. This has been the case with big nations like India or China, whose ‘national independence’ or even their so-called ‘revolution’ (read the setting up of a draconian form of state capitalism) didn’t allow them to break out of underdevelopment or destitution.” (4)

After thirty years of Indian growth averaging 7%, after forty years of Chinese growth averaging 10% a year, after China has become the world’s industrial workshop, with more manufacturing jobs than all the developed countries combined (see graph 1.8), after it has also overtaken US GDP in absolute volume (see graph 3.4) and has become the potential challenger to US hegemony in the medium term, what should we think? Should we laugh or cry when the ICC makes completely unreal “theoretical” statements about “the impossibility of any new industrialised nations emerging” after 1914?

But it is not only India and China that capitalism has been able to drag into its dynamics of accumulation, it is also the case of a good part of Southeast Asia, which represents, at the very least, almost half the world’s population! In fact, there are a significant number of other countries belonging to the former Third World that are undergoing significant development processes, but it would be tedious to enumerate and examine them in detail here. Nevertheless, there is one that is worth its weight in peanuts for this ‘organization’, and that is the case of Vietnam!

In fact, after the American defeat and the victory of the Vietcong in 1975, the ICC considered this country as dead and without any future: “Among a multi­tude of examples of the wars that have taken place since 1945, we can take that of Vietnam, which, according to those who in the 1960s and 70s were demonstrating under the flags of the NLF, (5) would make it possible to build a new and modern country, whose inhabitants would be freed from the calamities which accompanied the old Saigon regime. Since the reunification of this country in 1975, not only have the Vietnamese population not had any peace (the old ‘armies of liberation’ have been converted into an occupying army in Cambodia), but also their economic situation has got worse and worse to the point where, at its last Congress, the ruling party had to admit that the economy was bankrupt.” (6) At the time of writing, Vietnam’s growth rate had risen from 3.6% in 1987 to 6% in 1988.

The reader may think that this peremptory statement could very well be a slip of the pen on the part of its editor, or that the growth of Vietnam was too recent to be certain. Not in the least, since the same idea can be found in many subsequent articles in the ICC’s international theoretical review: “(…) for 20 years, the Vietcong confronted first the French and then the United States in a savage war where both sides committed the most appalling atrocities. The result was a devastated country which today, 16 years after its ‘liberation’, has not only been unable to rebuild but is increasingly sinking into catastrophe.” (7) However, at the time of writing (1992), Vietnam’s economic boom had already been well established since 1988 (at a rate of 5% per year). Moreover, its GDP per capita had already increased by 40% in sixteen years (from 1975 to 1991 – see the graphs below), yet this ‘organization’ still claims that it is “a devastated country which today, 16 years after its ‘liberation’, has not only been unable to rebuild but is increasingly sinking into catastrophe.” The doxa of the ICC’s positions is decidedly stronger than the reality of the facts, which is what they call – no kidding – their ‘scientific’ method of analysis!

Graph 3.5 - Vietnam – Growth of the GDP (1986 - 2018)
Graph 3.5 – Vietnam – Growth of the GDP (1986 – 2018). Source: J.R. Chaponnière & M. Lautier, 2019, L’Asie du Sud-Est, Bréal, p.170.

As the graph 3.6 below shows, Vietnam’s GDP per capita since 1820 has grown almost zero before 1914 and much more afterwards, reaching $6,062 in 2016, or six times more than in 1975, which is equivalent to an average annual growth rate of 4.8% over four decades: enough to make many Western leaders pale in comparison! Indeed, such a rate over such a long period of time is more than honorable for a country ravaged and almost destroyed by decades of wars, spills of defoliants, Napalm, cluster bombs, etc. – all things that have made entire territories unfit for habitation and cultivation. Moreover, this growth rate obtained in ‘decadence’ is much higher than most of the growths known for developed countries before 1914!

Graph 3.6 - Vietnam – GDP per inhabitant (1820 – 2016)
Graph 3.6: Vietnam – GDP per inhabitant (1820 – 2016)

Theoretical framework and national liberation struggles

The ‘theory’ of the ICC is that any real national liberation struggle (i.e. enabling a country to acquire real political independence, to free itself from the socio-economic shackles of the past and to develop economically) was still an open possibility in the 19th Century but is now impossible after 1914: “In the 20th Century, the nation has become too narrow a framework to contain the productive forces. Just like capitalist relations of pro­duction, it has become a veritable prison hol­ding back the productive forces.” Moreover, still according to this organization, every “na­tional independence became a mirage as soon as the interests of each national capital compelled them to integrate themselves into one or the other [of the two] big imperialist blocs, and thus renounce this independence. The examples of so-called ‘national independence’ in this century boil down to a country passing from one sphere of influ­ence to another.” (8)

In order to judge the relevance or otherwise of this ‘theoretical framework’ on the national question, it is particularly instructive to look at the cases of China and Vietnam, which were regularly used by the ICC to illustrate it. But the facts show exactly the opposite of its petitions of principle! Indeed, instead of developing during the said ‘ascending’ phase, these two countries stagnated before 1914, whereas they experienced an explosion of their growth during the said phase of ‘decadence’ (and even ‘decomposition’), that is to say the exact opposite of the idealistic postulates of this organization (see graph for Vietnam above and for China below. (9)

Graph 3.7 - China – GDP per inhabitant (1820 – 2016)
Graph 3.7 – China – GDP per inhabitant (1820 – 2016)

Certainly, if it is true that the accessions to political independence during the 20th Century were more formal than real, this has nothing to do with a so-called ‘decadence and impossibility of national developments since 1914’, but derives from the double economic and geopolitical bipolarization of the world that locks any possibility of significant developments outside the ten or so countries that have known the industrial revolution. It is in this sense that Rosa Luxemburg was right in relation to Lenin and the Third International on the national question, not by virtue of her theory of accumulation or of the advent of a supposed ‘decadence’ after the First World War, but because this double geo-economic and geopolitical polarization of the world has blocked any accession to a real political and economic independence within this framework.

However, if the ‘independence’ acquired by many countries during the 20th Century was more formal than real, it was nevertheless a necessary condition for being able to carry out real economic development policies in some of these countries when this double bipolarization disappeared. Thus, while China was able to break with its quasi-colonial domination in 1949, it nevertheless had to deal with a Soviet alliance until the early 1960s, and then open up to the Western bloc. However, despite this dual influence and imperialist dependence, it was able to maintain a relative political autonomy that allowed it to break away from the Soviet bloc, first, and then to open up to the world market from the early 1970s, while maintaining a certain autonomy from the new American sponsor. This relative independence was one of the conditions necessary to carry out a vigorous policy of economic development from 1979 onward (reforms introduced by Deng Xiao Ping), a policy made possible by the shift to neoliberal globalization in Western countries and reinforced by the end of the geopolitical bipolarization of the world in 1989 (collapse of the Berlin Wall). The same is true for Vietnam: although its independence in 1975 was gained under the tutelage of the Soviet bloc, it nevertheless allowed it to implement an economic development policy that took off just after the implosion of the Soviet bloc.

For the ICC, on the other hand, since any real political independence would be impossible after 1914, it firmly placed China in the American imperialist bloc from the mid-1970s and Vietnam in the other. (10) But then, how can this organization explain that the current polarization of the world is sharpened around the competition between China and the United States! Such an imperialist reconfiguration means ipso facto that China has been able to emancipate itself from American tutelage … whereas the ICC decreed this emancipation impossible! When, how and why? This organization remains silent on all these questions. The fact remains that, as far as these two countries are concerned, if their national independence could not be put to good use until the end of the 1970s, it will nevertheless constitute a tangible lever thereafter. This is also true for other countries, and not the least, such as India (we will come back to this).

To understand that the national liberation struggles were a real lure during the phase of double economic and political bipolarization of the world, but that they nevertheless constituted an indispensable basis for being able to carry out policies of economic development, as explained in the [aforementioned] study on 250 years of capitalism, requires a completely different theoretical framework than that of the ICC, which accumulates contradictions and inconsistencies!

The Four Curses of the ICC

In effect, to the impossibility of any development of new industrialized nations after 1914, the ICC adds three additional curses making this emergence an absolute and irremediable impossibility:

1- Stalinist state capitalisms backed by the army in less developed countries would illustrate, on the political level, their structural weaknesses on the economic level. These Stalinist bureaucratic rigidities would constitute shackles to their development, shackles imposed by the decadence of capitalism. (11)

2- Unlike the mixed-economy state capitalisms of Western Europe and North America, which offer more flexibility and performance on the economic level, Stalinist state capitalism is intrinsically inefficient, unreformable and can only implode, like the Eastern bloc in 1989 and the USSR shortly thereafter. (12)

3- The saturation of the world market and the economic crisis since the 1970s would no longer offer any significant possibility of development for these Stalinist or ex-Stalinist state capitalisms: “Today, by contrast, any development in the East of a competitive industry would inevitably be confronted with the general saturation of the world market. As was already the case during the 1970s with the “Third World” countries, Western credits aimed at financing such a development in the Eastern countries could only result in a further swelling their debt, consequently increasing still further the weight of debt on the whole of the world economy.” (13)

What is the reality? First of all, when this theory of ‘Stalinism only capable to implode’ – because inherently weak and unreformable – was put forward in 1989, it was already outdated, as the Stalinist-military regimes in China, Vietnam and Laos had been in the process of reform and growth [already] for a decade! Despite these formal denials, the ICC nevertheless wrote its ‘Theses on Stalinism’ and a plethora of ‘forecasts’ announcing the certain implosion of all the remaining Stalinist regimes, but this is still not the case thirty years later! Of course, Cuba and North Korea have not reformed (or very little) and are still economically in a bad way, but countries that are much more important and populated – such as China, Vietnam and Laos – formally contradict the ‘analyses’ of the ICC, since these are regimes that accumulated the four curses that it enunciates, and yet, not only have they been able to reform, but also to experience a very sustained growth over four decades! Moreover, whereas Laos corresponded to the typical case of the ICC condemning it to a sure decomposition and that this country also knew the sad ‘privilege’ to be the most bombed country of all human history (the USA poured there more than one ton of bombs per inhabitant, yes, one ton!) and well, in spite of all these curses, this country has spectacularly risen up as illustrated by the graph below!

Graph 3.8 - Laos – GDP per Inhabitant (1950 – 2016)
Graph 3.8 – Laos – GDP per Inhabitant (1950 – 2016)

Then, again in contrast to the ICC’s ‘learned prognostications’ of ‘inevitable social, economic and political decomposition’ and the impossibility of a “development of a competitive industry in the countries of the East” because they “would inevitably be confronted with the general saturation of the world market” (ibid), it is clear that some of them, such as Poland, the former Czechoslovakia and Hungary, have been doing much better than all the other developed countries since the 1990s (see graph 3.9)!

Graph 3.9 - GDP per inhabitant of three East European countries (1946 - 2016)
Graph 3.9 – GDP per inhabitant of three East European countries (1946 – 2016)

Finally, if today the ICC is obliged to consider this major fact that it ignored for nearly forty years, namely the economic rise of China as a major industrial power, when such a possibility was decreed to be totally impossible, (14) on the other hand, it still plays dead on all the other gaps in its analyses: the impossibility for Stalinism to reform itself, its inevitable implosion, its congenital economic weakness, the economic emergence of other countries than China… And the term ‘gaping holes’ is still very indulgent because, if we look closely, the reality is strictly the opposite of its theory of the four curses, since the strongest current growths are all the result of reformed Stalinist regimes relying on the army and achieved within the framework of an unfavorable world economic context for several decades, and even of ‘decomposition’ according to the ICC. Moreover, these growths are all much higher than those of before 1914, and are spread over some forty years! A trifle! Decadence since 1914 you say?

Graph 3.10a - Growth of the GDP per Inhabitant of China, Vietnam and the USA (1990 – 2016)
Graph 3.10 – Growth of the GDP per Inhabitant of China, Vietnam and the USA (1990 – 2016). Source: Milanovic, B., Op. Cit, p. 119. [Growth rates of the GDP per inhabitant in China, Vietnam and the USA from 1990 to 2016. The growth rates are calculated in real terms, based on the US-Dollar in 2011, at purchasing power parity. Source: World Bank, World Development Indicators, version 2017.]

The National Question and the ICC’s theory of accumulation in face of the facts

To conclude with, it is also necessary to underline another major inconsistency in the ICC’s ‘theoretical corpus’, namely the formal denial of its Luxemburgist theory of capital accumulation by the currently emerging countries. The latter postulates the need for an ever-increasing number of pre-capitalist markets in order to ensure growth. Now, since these markets were declared relatively insufficient on a world scale in 1914 to explain the opening of a period of ‘decadence of capitalism’, of a brake on the development of the productive forces, how can this organization explain the strong economic growth – much stronger than before 1914 – observed in certain Eastern countries for more than twenty-five years, in many Asian countries for three or four decades and even in certain African countries more recently? Indeed, it will be very difficult for them to find in the heap of ruins, scrap metal, defoliants, anti-personal bombs and chemical products that have sterilized a good part of the agriculture during decades in Vietnam and Laos the mass of pre-capitalist markets necessary to explain the economic development of these two countries? The same is true – and more particularly – in China, because, contrary to the European Ancien Régime which constituted a real pre-capitalist sphere allowing to sell a part of the goods resulting from the industrial revolution, post-Maoist China is not at all in the same configuration since this regime ruined the countryside and employed a majority of peasants in collective farms. As Mao said about his policy: “Two big mountains weigh heavily on the Chinese people. One is imperialism, the other is feudalism. The Chinese Communist Party has long since decided to destroy them.” (15) If there is one economic category that Maoist Stalinism has particularly ruined, it is that of pre-capitalist markets.

Asserting much stronger economic growth in ‘decadence’ when there are relatively fewer pre-capitalist markets than in ‘ascendancy’ is totally contrary to the analyses of the ICC. The latter cannot at the same time assert that there was a brake on the development of the productive forces after the First World War, as a result of a relative insufficiency of precapitalist markets, and, at the same time, claim that the latter remain sufficient only to explain higher growths in ‘decadence’!

Moreover, let us recall that Marx, after numerous scientific readings on several non-European societies, including China, had expressly restricted his theory of primitive accumulation to the European area. Therefore, to try to explain China’s development by primitive accumulation and the pattern of pre-capitalist markets is totally contrary to Marx’s analysis and to the most elementary realities. But the ICC does not care about this, because it does not hesitate to extend these mechanisms of primitive accumulation to the whole world in order to “explain” growths that it had always claimed to be impossible since the First World War! Understand this who can! Thus, the patches that the ICC tries to apply to its ‘theoretical framework’ in order to mask its punctures only weaken it further and make it completely ridiculous.

By pretending to make a work of analysis and deepening of Marxism, while it only makes its theoretical schemes prevail over the reality of the facts, the ICC reveals itself as political impostors.

C.Mcl., November 6, 2020.

Source: Les impostures du CCI (Courant Communiste International), III. Les quatre malédictions du CCI sur la question nationale.

Translation: H.C., June 7, 2021

Update: July 4, 2021 (Added source references to the graphs)

 

Index of Graphs (Table)

Click below on page 5


Notes:

2 250 years of modern Capitalism: A reconstruction of its dynamics, (Ch. 1 – 3, version of March 17, 2020).

3 MC & FM: ‘The proletarian struggle under decadence’, International Review of the ICC, no. 23 (4th quarter of 1980).

4 MC & FM, Op. Cit., International Review no. 23 (4th quarter of 1980).

5 The movement led by Ho Chi Minh, which was to take power in Vietnam when the Americans left the country. [ICC’s note]

6 FM, War, militarism and imperialist blocs in the decadence of capitalism, Part 1, International Review no. 52 (1st quarter of 1988).

7 Adalen, “National liberation” in the 20th Century: a strong link in the chain of imperialism, International Review no. 68 (1st quarter of 1992). MC & FM, Op. Cit., International Review no. 23 (4th quarter of 1980).

8 MC & FM, Op. Cit., International Review no. 23 (4th quarter of 1980).

9 China’s GDP per capita was $741 at the beginning of the ‘upward’ phase in 1820; $881 at its end in 1913; $757 just after the Maoist takeover in 1949; $1,384 when Mao died and $12,320 in 2016!

10 “They only include the two official military alliances and thus exclude countries like China (which alone accounts for 10.5% of the world total) which undoubtedly belong to the American bloc, whereas the only important Russian-bloc country which isn’t affiliated to the Warsaw Pact is Vietnam.” (FM, International Review no. 21, 2nd quarter 1980). And this is not a slip of the pen since this analysis is repeated in several articles including congress resolutions: “ (…) – the complete insertion of Vietnam into the Russian bloc; – the growing integration of China into the US bloc.” (Resolution on the International Situation (1979), International Review no.18, 3rd quarter 1979). Or still: Thus, the sympathy of the Western bourgeoisie for Gorbachev finds its significance essentially in the new configuration of the world imperialist arena and not in any aversion to the Stalinist state. It suffices to be convinced of it, to remember the eulogistic articles dedicated by all the Western press to China when this last one was integrated into the Western block after the war of Vietnam.” (Révolution Internationale’ no. 185; December 1989)

11 Read the ICC’s pamphlet on the collapse of Stalinism. (Online in French: Effondrement du Stalinisme).

12 Idem.

13 Source: Resolution: The International Situation (June 1990), International Review no. 63, 4th quarter 1990.

14 Forty years of denial of reality, which is quite a feat for an organization that prides itself on being at the forefront of theoretical research! However, despite this acknowledgment of China’s current economic successes, this denial persists because the ‘explanatory’ elements put forward do not challenge any of the ICC’s past analyses, and worse, they add gaping holes to its theoretical presuppositions. We will come back to this in more detail in another contribution.

15 ‘How Yukong Moved the Mountains’, Mao’s speech delivered on June 11, 1945 at the 7th Congress of the Chinese Communist Party.

8 thoughts on “Has Capitalism entered its Decadence since 1914?”

  1. Link commented on Topic: Has Capitalism entered its Decadence since 1914?
    November 6, 2020:

    I would like to start of by absolutely agreeing with CM’s presentation of empirical facts about the developments during the past century. The ICC in particular has had major problems recognising what has been actually happening in the world economy because it is stuck in Luxemburg’s theories about accumulation being dependant on non-capitalist markets.

    I however disagree with the interpretation that leads to a rejection of the idea of decadence and indeed the suggestion that the ICC presents falsehoods.

    Luxemburg, Lenin, Bukharin and others are I think to be applauded for their efforts at the start of the 20th century to understand how capitalism was changing at that time. With hindsight we can say they all got some things right and some things wrong. With regard to the Luxemburgism taken up by groups in the 30s and later by the ICC, it seems to me that it is possible to say that her ideas made a certain sense and were justifiable in the context of world developments up to say the 1960s. It seems to me that it is only since then during an extended period of reaction and of continued growth of the capitalist economy and world population that her thesis about non-capitalist markets really needs to be seriously questioned and for my part definitively abandoned.

    CM takes this criticism of the ICC to an extreme however in rejecting the concepts of decadence/obsolescence (I become less concerned about the label to be used, the point is that a significant change in capitalism development took place).

    The ICC’s unwillingness to reject Luxemburgism leads it into many problems because certainly in the early days and to some extent today explains decadence as an economic crisis, as permanent crisis, market saturation and a product of the lack of pre cap markets and these explanation do not hold up any longer. Some of the assessments it makes on workers struggle, political activity and economic development are as a consequence faulty and open to serious questioning. Now I do agree that there are issues that the ICC has got wrong

    However, just because luxemburgism is wrong does not mean we should reject an understand of imperialism and the completion of a world market and the changes in capitalism. Nor should we reject Marx’s view of historical materialism which identifies for all exploiting societies a period of ascendancy and a subsequent period where the relations of production become a fetter on the forces of production. I cannot agree therefore that to recognise the continued growth of capitalism in decadence should lead to seeing dangerous political aberrations in rejecting reformism, national question, its interpretation of historical materialism and so forth.

    My explanation for this viewpoint is thats I think it has been clear for sometime that the onset of decadence/obsolescence should not be seen as the onset of an economic crisis. It is not determined by the amount of non-capitalist markets available nor is it a product of a certain rate of profit and nor a certain amount of overproduction. Decadence/obsolescence is a political and social even a historical development that is not in itself an economic crises but it creates an environment where the contradictions within capitalism are sharper and more prone to generate crises.

    In fact Grossman’s following explanation of capital expansion (from Chap 2 The Law of Capitalist Breakdown seems a far more insightful view of how capitalism has grown within decadence, and it rejects Luxemburgism and provides an explanation of why capitalism can continue to grow even within decadence.

    “Despite the fall in the rate of profit, accumulation proceeds at an accelerated tempo because the scope of accumulation expands not in proportion to the level of profitability, but in proportion to the weight of the already accumulated capital: ‘beyond certain limits a large capital with a small rate of profit accumulates faster than a small capital with a large rate of profit’ (Marx Capital Vol 3)”

    After all the basis of capitalism and what differentiates it from previous societies is precisely the ongoing accumulation of constant capital. We can never expect it not to continue to grow outside of overt crises. Decadence can only represent a fetter on the growth of productive forces not their decline.

  2. The author of this (and other) works in progress, has set himself the task to confront the positions of the ICC with reality. In doing so, he is contributing to a necessary revision of the heroic effort of the ICC to synthesize the historical contributions of the Italian, German-Dutch, and other Communist Lefts. I can only confirm the urgent need for this work.

    Unfortunately, he does so in partly self-chosen isolation from other comrades and from the work of analyzing present reality, taking a position, and contributing to the actual class struggle, even with the present limited possibilities. He has defended this double isolation with reference to Lenin that withdrew from the life of his party to write Materialism and Empiriocriticism; an exceptionally bad example, and in no way justifying C.Mcl.’s retreat, that has reached now about five years. Unfortunately, the dangers of this isolation from class struggle are starting to become evident when his latest publications ignore the specter of generalizing inter-imperialist wars that are haunting the proletariat, from the Middle East to Indochina, and from the Caucasus to Libya.

    When the Communist International, following the efforts of mainly Lenin and Luxemburg to understand the causes of World Ware One, declared “The contradictions of the capitalist world system which were hidden deep within it have burst forth with tremendous force in a single huge explosion – the great imperialist world war” (Manifesto of the CI), this was understood by many in a mechanistic way as the end of the capitalist mode of production, because capitalism would not be able to restore itself. Indeed the national capitals that had suffered most from the war – Germany, Hungary, Italy, and Russia – completely collapsed, and so did their state power, followed by revolts and revolutions by the workers and bigger parts of a hungry and war-tired population. In Germany, this led the KAPD to theorize a ‘death crisis capitalism’ on the basis of Luxemburg’s theory of extra-capitalist markets. This theory found some evidence in the disastrous situation of the German economy but was contradicted by the post-war boom of the capitals that had won the war. In his American exile, Paul Mattick in full Depression elaborated a theory based on the tendential fall of the profit rate. Both theories could argue more or less correct that World War was the consequence of certain economic contradictions of capitalism.

    [It is an incontestable merit to have shown] that both the theory of Luxemburg and that of Mattick/Grossman were one-factor explanations when Marx in each of his analyses of several recessions underlined another factor as the main cause and that all factors are related to each other (La crise qui vient [pdf document available]). Linked to this C.Mcl. showed the reality of productive orders of capitalism as determining the continued survival of capitalism. However, in his aim to refute the ICC-version of the theory of decadence of capitalism, he had to follow its long-term view point of ‘before’ and ‘after 1914’. In doing so, the question of war, which is essential to the several theories of decadence, seems to have been lost.

    First, let’s have a look at the theory of decadence as the ICC sees it. Is it true that capitalism, like all productive orders historical modes of production before it, develops according to a curve with rise, summit, and downfall? As far as I know, Marx and Engels never said anything like that. What they did say was that communism contrary to productive relations in the past will have no exploitation and repression and that the proletariat as an exploited class will have no economic power to base its political struggle, as the bourgeoisie could do. Therefore in his First draft of Civil War in France, Marx underlines that the Commune – this finally discovered form of proletarian dictatorship – is only a form in which the liberation of labor will take place by the implementation of a proletarian economy. This is of course totally unacceptable for the ‘Leninists/Trotskyists’ in the ICC, and these kicked out, for they would have to accuse Marx of Stalinism.

    When capitalism is not overcome by the proletarian revolution, it will continue, finding new ways (‘productive orders’ in the words of C.Mcl.) and by a re-division of the world between imperialist powers (inter-imperialist wars) and the following redistribution of surplus-value extorted form the proletariat. Therefore it is important to analyze economic and demographic figures not as before and after 1914, but as well according to the ‘the real development’ of capital and labor: crisis, war, reconstruction, crisis. Finally, for any analysis that can explain for each generation of proletarians in each region of the world what they are living and what are the class forces of their situation, more details are needed than an overview of 250 years of world industrial capitalism or that of GB/UK. Latter can be symptomatic for the developments on the Continent, or even North-America. In this respect a good job has been done. But the world proletariat understood as the enormous masses that have lost their means of subsistence without all finding work in capitalism, from Iraq to Chile and from Pennsylvania to South Africa, cannot be satisfied with an analysis that centers around the old industrial centers of world capitalism. And neither the unemployed coal miners and steelworkers in the USA will be satisfied with the statement that there has been no net loss of jobs by the transfer of their industries to Asia.

    F.C. 13-11-2020

  3. In terms of CM’s piece, ive reread some and it appears i may well have misunderstood the first part of the intro and  i can now see in the section on Brake on the Productive Forces that there is agreement with the idea of periods of ascendancy and decline in capitalism.  Im afraid i got that wrong but i still cannot find anywhere that actually agrees that 1914 was a turning point and that capitalism is in decadence now.  In fact items 2 – 6 of the introduction are full of criticisms of the ICCs positions about the political consequences of decadence eg reformism, leftism, national question, national development, identity politics, workers councils.

    If i am misunderstanding this, please let me know, but my interpretation of the text is that it must be saying capitalism is still in its ascendant period?

    I would also like to question the statistics on the rate of exploitation during the 20th Century. These statistics are just based on the UK and are therefore not representative of the world economy as a whole against which the UK has declined significantly. Whilst I can see that rate of exploitation would vary on against factors eg stagnation of the 30s and the increased wage levels and population levels will both tend to reduce the rate of exploitation as is shown in the chart, I am wary about the overall idea that it has reduced over the 20th Century. Do these figures represent the weakness of the UK relative to others ie lack of investment? The undoubted advances in technology over the century would seem to complement the increased figures for increased GDP and increased population that are mentioned elsewhere but I would have thought exploitation would overall increase therefore just as the rate of profit falls because C generally increases at a faster rate than V. Anyway is there a clarification for these figures please?

    I cant comment to much on FC’s contribution as there has clearly been an ongoing discussion that i dont know about but i think its wrong to discard the view of a period of decline for capitalism based on purely economic issues.

    As I’m inclined to think that the term decadence has come from Luxemburg’s analysis that economic decay must happen after its ascendant period has come to an end, I am now more inclined to use the term obsolescence but i do not treat this is as overly important. I keep using both terms. 

    I would argue along with most that imperialism and the 1914 war marked the turning point for capitalism.  It marked the end of the ascendant period and the onset of decadence/obsolescence.  My view is that none of the economic theories of capitalist crisis can be used to explain this change, they just dont make sense as an explanation of this change in period. 

    I think that the changes in that period are political and social and this is why so many agree on 1914 as the change in period because of the onset of imperialism, the completion of the world market and the military confrontations this creates, the emergence of state capitalism to take control of national economies and international relations and i would agree with those including Luxemburg who saw this as a period of wars and revolutions – although clearly that has not worked out as permanent world wars or permanent revolutions. It has also been a period of increased exploitation of the working class. These are signs of capitalism’s decline, ie of the social relations being a fetter on the productive forces!  The issue is what could have been done with the productive forces if we didn’t have capitalism not of permanent crisis or stagnation or saturated markets or even low rate of profit (as capital seems to adapt by increasing in size)

    I believe that it is luxemburg’s theory of accumulation, and the early ICC positions on this topic, that got us all believing incorrectly that decadence meant economic stagnation and decline.

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