“We are at a stage in which crises are no longer a symptom of the rise of capitalism and not yet a symptom of its demise.” – Rosa Luxemburg, (1900)
There is a joke regarding the overly-deterministic nature with which Marxists discuss capitalist crises that goes: “Marxists have accurately predicted seven of the last three recessions.” It feels appropriate to begin with levity, given the severity and weight of the implications of a theory of crisis, as well as a nod of acknowledgment to the inevitable problems of attempts to predict and sculpt determinate form out of the unforgiving indeterminacy of history yet to unfold. There is a reason that Marxists concern themselves with economic crises, as such events direct “attention to the discontinuities of history, to breaks in the path of development, ruptures in the pattern of movement, variations in the intensity of time.” In a crisis something of the unique character of capitalism can be glimpsed in the exact manner in which its constituent processes fail to come together. It would not be an overstatement to say that a distinguishing feature of Marxism is that it specifically theorizes an immanent tendency towards crisis and the specific social instabilities that give rise to it. For bourgeois theorists, on the other hand, crises seem to come from nowhere. They are accidents which reveal nothing about capitalism’s internal operations. The exegesis of crisis becomes a task of nailing down a culprit. What disturbs a system derived from natural law?
From such a perspective, historical crises themselves are framed as aberrations, begging for autopsy. We experience booms, we suffer busts. The tale presents factors as outside of the inner dynamics of the political-economic functions of capitalist society. If an internal origin is found, we learn that it was taken too far. With each breakdown, economists and analysts publish their breathless apologetics, citing a litany of particularist and external factors plaguing the system. No internal tendency is detected. The analyses may pinpoint complex and unique proximal causes in each case, but the premises are all variations on a theme: capitalism naturally exists in a state of self-regulating equilibrium, unless some unnatural condition is inhibiting its special homeostatic mechanisms. The Great Depression was explained with overly lax banking policies, it’s origin point situated in stock brokers overextending margin calls leading to a crash in late 1929. The stagflation of the 1970s was supposedly the result of the OPEC oil embargo following years of inflationary spending to fund the Vietnam war. The mini-crashes of the 1980s stemmed from excessive state expenditure throughout the 1970s and runaway assets like junk bonds exerting a hypnotic allure to investors. The Asian financial crisis of 1997 was treated as primarily a financial and East Asian phenomenon, chalking it up almost entirely to currency exchange rates fixed to a rising dollar, causing a round of runs on current accounts across Asian central banks. The Great Recession, of course, boiled down to reckless and predatory subprime mortgage lending and the eventual bursting of a housing bubble big enough to swallow the global economy. And now, perhaps, a coronavirus outbreak will set Chinese exports into precipitous decline after already being weakened in a misguided trade war, as some speculate now. In any of these cases, risky behavior responding to perverse incentives or botched state policies or sticky regulatory environments are the human errors, bad actors and random noise that steer the ship off course.
Though the phenomena of crisis are observed to cyclically recur, the possibility of these events expressing an inner tendency is struck from thought, in the need to focus on very proximal causes. Instead, bourgeois theory explains crises by way of what can be generally called “the investment cycle,” which of course has many variations in emphasis. In this perspective, economic development proceeds through the subjective judgment and will of capital-owners who, encouraged by the prevailing interest rates, invest their capital where they believe it will get the highest return. The market is then a maelstrom of passions, affects, slant percepts and magical thinking, which can be all the more distorted as speculation compounds. It is in such a runaway departure from rationality where crises – or “market corrections” – hit, righting the course through the balancing wisdom of bare factual reality. Despite the claims to agency which the “subjective judgment” of investors pretends, objective determinism dominates in this view. What is examined are the irregularities in the quantitative relations between commodities as observed in their relations to each other in exchange. The isolated categories of economics fetishizes the living relations between people, taking the result for the process, becoming a science of objects in relation to each other. In this universe, there are no systemic irregularities except through artificial obstacles to the natural investment cycle, booms can be extended through monetary wizardry and growth is always possible with some Davos visioneering.
This brief caricature is not to say that contemporary economics is without sophistication or that it is completely detached from empirical phenomena; it is to say that its sophistication belies a crucial methodological aporia. Marx’s method of moving past the “noisy sphere” of market circulation in order to assay the “hidden abode of production” allows us to examine the connective tissue of capitalist society: the specificity of the value-form which organizes the production process, and the social relations in the production process which determine this value-form. In an analysis of the social relations of capitalism as a mode of production and form of social organization, subjects are located. Classes may be discerned from subjective relations to the production process, the production of the social body’s reproduction. A fundamental division into two ideal-typical classes, between the proletariat, that subject whose subjectivity is alienated as wage-laborer, a bearer of labor-power, in opposition to the bourgeoisie as capitalist, possessing the power of the means of production, that requires the exploitation of labor-power. Value as the object of production requires maintaining this fundamental relational structure. From this cleavage is apparent an internal tension that drives the organization of the production process and the course of capitalist development; a continual struggle to control the means by which each class reproduces itself. Out of this tension, a complication emerges to capitalist ideology’s objective determinism. The contradiction of a general equilibrium that rests upon a shifting ground of conflict that generates its movement and sees periodic crises resulting in a brief disruption of its normative functions. After all, the biggest clue to the bankruptcy of the bourgeois understanding of crisis is in the perfect coexistence of widespread immiseration in the midst of economic booms. Crisis is merely taken in afterthought as an aberration from this objective determinism of the bourgeois ideology. It is for the Marxists to contend then that the success of capitalist profitability and continuity as a mode of production requires an ongoing crisis of social reproduction; we must then ask what exactly is the relationship between the value-form and social reproduction?
It is an axiom of our work that it is this value-form, which is a relation of exploitation, that gives capitalism its unstable and stumbling character; that the resulting antagonisms and the deferment of their dialectical resolution are a driving force of historical development. The cyclical appearance of crises are set against this horizon of a much more entrenched causal relation in the class relations themselves; and that, for this reason, crisis theory is much more than an attempt to account for economic crashes. Rather it is to account for the historical transience of capitalism as a mode of production, the subjective interest of that which constitutes a proletariat in overcoming the subsumption of social reproduction to capital, and locating the means by which we may achieve this supersession through the process of building agency via proletarian self-composition as a subjective, political agent external and antithetical to the reproduction of the relation of exploitation, in and against these critical ruptures.
But this theoretical task is not necessarily straightforward. What exactly is the Marxist theory of crisis? There is no explicit elaboration of a theory of crisis proper in Marx’s work, as he only obliquely touches on crisis as such in the course of describing the dynamics of accumulation. This suggests a deep relationship between accumulation – the reproduction of capitalist social relations – and crisis – the appearance of their potential non-reproduction. Unfortunately, the contours of this relationship are fuzzy and Marx’s systematic study left unfinished. At different points, he seems to emphasize overproduction, underconsumption, disproportionality between the production of means of production and the production of articles of consumption, the unplanned nature of competition, and overaccumulation as the driver of crisis. Engels seemed to favor the contradiction between the limitless and escalating development of productive forces and the limited ability of the population to consume (underconsumption), in combination with the ‘anarchy of the market.’ The ambiguity of theory met with objective developments in the historical conjuncture of the Second International lead to debates, particularly inflected between those over the question of reformism, and eventually to two dominant schools: the underconsumptionists, most exemplified by Rosa Luxembourg, and the disproportionality school, associated with Rudolf Hilferding.
Hilferding’s disproportionality theory rested on an idea of the dominance of finance capital. He argued that the rise of trusts and cartels, composited together through infusions of credit from financial institutions, was the result of the systemic immobilization of capital into fixed capital forms. This stymied the transfer of capital between branches and its necessary function in the equalization of profit rates, which increasingly becomes only possible “through the influx of new capital into those spheres in which the rate of profit is above the average, whereas the withdrawal of capital from those branches which have a large amount of fixed capital is extremely difficult.” This further compounds the overreliance on finance and monopolistic concentration to overcome these barriers to capital mobility. This “replacement of the market” by centralized banking cartels creates massive distortions in the price structure, with overinvestment in some lines and underinvestment in others, yielding surplus capital which cannot find outlets for domestic productive investment, instead seeking them overseas. This need to export capital abroad forms the basis of Lenin’s declaration that the era of monopolies and finance constituted a new phase of capital accumulation, in which oversaturation necessitated imperialism. The disproportionalities between branches of production stimulate a need for increasingly massive infusions of finance capital, which in turn amplifies the tendency towards concentration and preventing the market from restoring proportionality through the elimination of weaker capitals. Note that this departs from Engels’ idea of secular overproduction, where capitalist competition persistently stimulates the development of productive forces beyond all boundaries, instead positing that it was the lack of competition, in the form of increasingly consolidated monopolies, that prevented the necessary equalization of the rate of profit between branches of industry. Similarly, unlike the underconsumptionists, for which disproportionality was driven by capitalist competition itself, Hilferding locates the cause of periodic crisis in “imperfect competition” and barriers to the mobility of capital. For the disproportionality school, the lack of regulation was the ultimate source of crises.
The underconsumption hypothesis drew largely on the contemporary theoretical developments on imperialism of its time, positing that capitalism, as production for the purpose of value’s self-valorization, would expand to such degrees that new markets must be constantly sought throughout the world to realize the commodity product’s values in consumption, but that these would not be able to absorb the sum of capital values that require realization. According to this theory, capitalist competition does not result in the market balancing out discrepancies between supply and demand, with firms cutting prices and contracting production to match consumption needs, but rather in a drive to intensify the work process and expand into the market share of competitors. Therefore, there is a systematic tendency for competition to push production beyond the ability of the commodities to be consumed, thus an inability to realize their values. Luxemburg particularly attended to the reproduction schemes Marx laid out in Capital, Volume II. The expansion in the production of means of production would not necessarily meet any issues, as capitalists producing articles of consumption will maintain demand in the face of potential oversupply, in order to expand their own productive forces. But this demand must ultimately be reciprocated if the entire system is to reproduce itself; the capitalists producing consumer goods will only expand production if they can reasonably expect to sell their own products. This leads to an imperialist tendency to “create new markets” to absorb overproduced commodities. Capitalism can only continue to exist when met with a source of demand external to it, in the form of precapitalist societies yet to be integrated. The exhaustion of this periphery leads to the intensification of imperialism, its “final stage,” marking the secular tendency towards a final breakdown. The limitation of this viewpoint is not that this does not occur, but that, in posing the market as the limit, assumes that an external market expansion is all that is needed to rectify the discrepancy. It expresses a real contradiction animating capitalism, the contradiction between production for use-value and production for exchange-value, but this contradiction finds itself located outside the capitalist production process itself in the sphere of circulation.
For other underconsumptionists, like Paul Sweezy, this tendency to outstrip demand did not have to end with the closing of capitalism’s frontiers, but could be staved off with unproductive state expenditure artificially propping up demand. This bears more than a passing resemblance to Keynesian prescriptions of economic controls through state fiscal spending to stimulate aggregate demand. This is no coincidence, as this school of thought grew to dominance at the same time as Keynesianism became the reigning organizing principle of crisis management in Western capitalism, in the wake of the Great Depression. While significantly different, they each share a focus on the market’s ability to “support” continued growth, locating the cause of the crisis in the failure of circulation to realize value. According to Keynesian hypotheses, however, a circuit of value as a socially-constituted relation is not a central figure of capital as seen in Marxist theories. Rather, the focus is found in business cycles of investments seeking a marginal efficiency of capital in the rate of return, where the success of a given wave of investment in one period determines the volume in following periods. The conclusion drawn here is that if appropriate investment may be achieved, then slumps can be avoided, given that eventually the actions of entrepreneurs would become self-justifying. Such is the case that in accordance with Keynesian economic theories, issues arising in the sphere of consumption become crises of effective demand, and the solution of state-induced investment becomes a support mechanism by which industry may operate efficiently whilst stimulating demand. Later Keynesian theory would find development in the works of Hyman Minsky, who saw a causal factor in the instability of financial factors in investment that lead to a series of payment commitments reliant upon the indebted investor’s income to satisfy payment. At the root of these conceptions is the assumption that, for a capitalist economic system to function, “prices must carry profits.”
Western Communist Parties themselves adopted a hybrid Marxist-Keynesian, a supposed democratic road to socialism, as socialists were forced to make alliances with liberals and reformists of various kinds in the mid-century interregnum. The contradictions grew. “As the [postwar] boom persisted, underconsumptionist theories of secular stagnation and inevitable crises appeared less and less convincing, while the claim that Keynesianism was in some way anti-capitalist appeared increasingly hollow.” The course of history itself disrupted these orthodoxies, the latent contradiction coming forth, as the last years of the postwar boom turned to the stagnation of the 1970s.
Keynesianism and social democratic institutions failed to prevent, after decades of unprecedented growth, the onset of stagnation, marked in its early stages not by the appearance of mass unemployment but an undeniable fall in the average rate of profit, stimulating new debates to account for this. The resulting theories are distinguished from the previous orthodox Marxist theories in that they consider the fall in the rate of profit as causal, not merely correlative, to the development of crisis conditions. The rate of profit always falls in the advent of an economic crash, but these theories made explanatory recourse to Marx’s formulation of the tendency for the rate of profit to fall over time. The emphasis in this period was not just in providing a Marxist account for the phenomenon of periodic crises, but in interrogating the extent to which one could speak of a secular crisis tendency, one that lead, through objective laws of motion, to a breakdown of the capitalist system.
Three main branches came from this period of debate, each with their own answers to the question of whether the fall in the rate of profit was the result of rising wages eroding the basis of profitability. The first of these schools answered in the affirmative, asserting that militant struggles over the distribution of capital incomes drove up wages to an intolerable degree, thus exerting a “squeeze” on profits. Politically, this viewpoint aligned with a Trotskyist strategy of “transitional demands,” in which the blatant failure of capitalism to meet the militant demands of the working class would enable the emergence of class consciousness. This, however, rested on a reactionary slippery slope, portraying capitalism’s limits not as inherent to accumulation, but in the “excessive” demands of the working class, a situation, in any case, that was to be soon rectified, without overcoming the horizon of crisis, with the destruction of militant labor and the resulting neoliberal “wage squeeze.”
The second school repudiated the “subjective” orientation of the first, in favor of an objectivist focus on the organic composition of capital. This derives from Capital itself and lies close to Marx’s most explicit formulation of crisis tendencies. We will significantly expand on this concept in coming sections, but for now, suffice it to say that with the progressive increase in the productivity of labor the ratio human labor to technical means of production shrinks as each worker comes to command a larger and larger mass of machines and tools. Given a certain rate of exploitation, this rising organic composition of capital, as it is referred to, will stymie the production of surplus value, thus leading to a shrinking rate of profit. However, this immediately stimulates its own countertendency, as the rate of exploitation will rise with higher unit labor productivity. The tendency to fall, then, comes about when the rate of increase of organic composition surpasses that of the rate of exploitation. On its own, this does not constitute a sufficient theory of secular crisis for this very reason. A further limitation to this viewpoint was a sort of millenarianism, in which technological progress alone condemned capitalist social relations, the so-called “objective tendency,” and the specter of crisis would assert itself regardless of the state of class struggle. The role of the communist movement was to be to prepare itself to take advantage of this external movement.
The third school attempted to rectify the issues with the first two, synthesizing the “neo-Ricardian” focus on distributional struggles with the mechanistic approach regarding the organic composition. In short, class struggle was theorized at the center of crisis. One variant of this school followed Kozo Uno in identifying the crisis tendency as “overaccumulation with respect to labor-power.” The presupposition here was that with the development of monopoly capital, competition in the labor market intensified such that building wage squeezes on profits stimulated a flurry of labor-saving technology, thus precipitating a crisis with the sudden increase in fixed constant capital and a fall in the rate of profit. The value of this perspective is it’s corroboration of the conflict over wages cutting into profits as a structural antagonism rather than a contingent effect of a voluntarist model of class struggle. Further, it accounts for the phenomenon of unemployment and appearance of relative surplus populations alongside crises. A separate attempt to explain crisis by way of class struggle shifted from a focus on “distribution,” i.e. wages, onto the struggles over production. As stated before, the effect of a given composition of capital on the rate of profit depends on the rate of exploitation, the ratio of necessary to surplus labor. The introduction of new technology may undermine profitability but this will be offset by the extension of the working day, exacting labor productivity increases and reductions in the value of labor-power, that is, attaining higher productivity and therefore cheaper prices in the basket of basic goods that the laborer consumes in order to reproduce themselves. Both bodies of theory, while advancing a structural rather than voluntarist dynamic of the class antagonism determining accumulation, fall into the shortcomings of the first school: theoretically, with adequate suppression of proletarian ascendency, a steady state could be achieved that could indefinitely postpone crisis. While capturing crucial dimensions to the unfolding and causal structure of the crisis tendencies of capitalism, this emerging Marxist consensus around the tendency of the rate of profit to fall that came from these debates failed to fully explain why crisis must occur under capitalism. It is here where we take our starting point.
The diversity of crisis theories is not due to a diversity of misreadings, all trying and failing to uncover the transcendent but hidden truth laid down in manuscripts of the 1860s, but is rather due to the inherent impossibility of applying the highly abstracted critique of political economy to the moving contradictions and concrete conjunctures of history in any complete fashion. For every theory that was successfully debated out of vogue by more rigorous contemporaries, the ensuing consensus was just as often shown to be inadequate only in retrospect, after unforeseen developments. This hints at a lurking indeterminacy within the course of these relations. The “laws of motion” of capital are not set axioms, unfolding linearly, but tendencies intertwined with counteracting forces. “The concrete is concrete because it is the concentration of many determinations, hence unity of the diverse.” Any appearance of a unified object is the result of a concerted process, in which the current determination has been decided by the relative capacity of a given element to subsume its agonists. It is never frozen or finalized, but only subject to dilating intensities. The turbulence of the unending class struggle may stabilize the inner tensions, dampening the tendency towards crisis, or it may inexorably amplify it. Any given crisis theory, as attentive as it might be to concrete nuance and extenuating conditions, will come to appear overly mechanistic in time. As such, communists must always strive to think with the movements of history, that is, the movement of class struggle in time and space. While we will draw upon the invaluable work of previous analyses of capitalist crisis, we make a distinction in our focus in crisis as an immanent tendency to capitalist production as the ultimate consequence of its characteristic and historically specific social relations of production, of the condition of alienating human subjectivity in the commodification of labor-power, and the struggle for reproduction that originates from this internal relation. Many economic theories of crisis formation are correct in their observations, but are unified in their appearance by labor’s condition of alienation that valorization requires, as well as the ongoing manipulations of space and time for valorization that accumulation entails. A Marxist theory of crisis that serves class struggle must seek to place in context and emphasize the subjective elements that act in a relation of causality to crisis, rather than solely engaging in the litigation of empirical factors.
It is our assessment that past crisis theory is limited by an emphasis on, if not entire scope within, the economic manifestations of crisis. This is occasionally supplemented with an attention to the role of states or political institutions, reified as separate and autonomous actors that (mis)manage crises as they arise. Sometimes reference is made to one or another social dimension that correlates with the moment of crisis, such as stoked racial animus or the impact on the nuclear family. But this is all to remain bound by the categories of an augmented political economy. It is our contention that crisis is best apprehended as the problematic reproduction of the capitalist social form in its totality, as the conditions for valorization that must be established in processes of accumulation are in contradiction with the interests in the reproduction of the valorizing element, the bearer of labor-power. This points to another aporia in the elusive semantics of crisis discourse: crisis as an event, bounded in time, or as a horizon, omnipresent but never quite reached. What is the proper scale to speak of a crisis occurring? Are the crisis tendencies of capital only observable in terms of secular trends? This is related to the much more relevant question of whether we can say that capitalism’s crisis tendencies will lead, by its own logic, to anything like a fatal breakdown, or if each potential obstacle to valorization will turn out to be just another threshold for capital’s morphing forms. Is it possible that capital undermines itself to the point of exhaustion?
By considering capitalism not as “an economic system” – a tautology as economy as such emerges only within bourgeois society – but as both a social form and a totality, we attempt to locate the dynamism that capitalism exhibits in its constitutive class antagonisms and expand the frame of analysis to a wide enough scope to make sense of the class relation outside of its “mere” economic manifestations. The mode of production is more broadly a contradictory mode of social reproduction. An economistic perspective details the relations of things to things, and the objective consequences of this sphere for human life, rather than the objectification of relations between people in a process of social reproduction subordinate to the accumulation of capital.
Capitalist social relations produce the appearance of society as an aggregate mass of atomized individuals, reflecting the degree to which relations between individuals come to be mediated through commodity production. Though the experience of life under capitalism is substantially individualized, the myriad situations produced by material conditions can be characterized in the formation of classes as a process in motion, complicated by any number of factors, inner-class competitions and struggles that result from the turbulence of accumulation. The proletariat’s condition of being “without reserves” makes it a class with “radical needs,” who’s self interest lies in the abolition of this condition, and therefore of classes. To speak of class as formed out of a continual process is not to state per se that class mobility for individuals is common; indeed, most people spend their entire lives without fundamentally altering their relation to production. Rather, it is to say that the struggle between classes is continuous and undecided, that the proletariat’s separation from the means of subsistence has to be reimposed, in order for labor-power, the basis of all social wealth in capitalist society, to remain commodified. The maintenance of mass deprivation is the ultimate object of accumulation, through which capital comes to command a greater pool of social labor. It is often in those historical moments where the underlying crisis makes itself present and felt that the fundamental class antagonism is most clearly perceived, and reveals subjective potentials unclouded by bourgeois mystifications. Wage-labor, qua wage-labor, exists as a form of capital. Through the processes of social fragmentation, social relations become objectified and fixed, but emerging from this is subjectivity within the constitution of these social relations. What is revealed in struggle is a social process that can be acted upon; the negation of the negation: labor-power as separable and alienable, the negation, is negated by the process of wresting back command over reproduction.
What is mystified to us is that the conditions of each cyclical eruption of crisis are always already with us, and born in the everyday functions of capitalism as a generalized mode of production and form of social organization. The event of its rupture into a generalized social form is a matter of the development of the processes of capital accumulation and the ensuing concentration. This is successively mediated by the perpetual coexistence of capitalism’s normative conditions for reproduction requiring the distribution of material realities of crisis to specific regions, displacements of instabilities inherent to the functional processes of capital accumulation. Masses of proletarians relegated to the affordability of life in a slum, countries under the boot of empire saddled with skyrocketing debts, incarcerated workers toiling or entombed in the social death of the slave; these are the realities of such displacements. As the conditions for capital’s reproduction accumulate and concentrate in more expansive and greater magnitudes, the field of movement and action for these generative processes grows increasingly constricted. A globally integrated capitalism is all the more incapacitated by the inadequacy of the peripheries in absorbing its expansions. The human species increasingly realizes its growing social productive power on a global scale, yet remains dominated by its objective functions and the class relations that necessitate them.
When the particular crises of the total social body constituted under a capitalist mode of production and social organization find themselves converging, that is, proliferating and extending into confluences of apparently separate spheres of social life, a quantitative intensification of crises can result in a qualitative shift in the experience of the crisis. The condition of immiseration is brought about on a scale without precedent. Classes undergo composition in situations that force them to act according to their interests as determined by their relation to the society’s base of production, the materiality by which it realizes its reproduction. As crises proceed, it is important to examine who is affected, what solutions come from the state, and who is providing what for who’s needs. It is never so simple as a moment of failure on behalf of the owners and managers of capital to conduct themselves according to the greater good, nor is it the result of an unreliable consumer base. Rather, it is the very tendency towards crisis made manifest.
Of course, none of this quite captures the immediate reality of crisis, and the persistent shock treatment of crisis to the proletariat and those just on the verge of joining that class. While being exemplary moments of the violence at the base of class society revealing itself, it still may often further drive us into necessary means of sustaining ourselves that further mystify the trajectory in which crisis inexorably leads us, tensing rather than resolving the fundamental contradictions. Such is the indeterminacy of crisis that yields great movement in the class struggle, tipping the ephemeral compositions and balance of class forces into new directions, sometimes toward potentially revolutionary horizons or in the direction of outright reaction. The strategy becomes one of determining through what means the immediate needs of the masses suffering the brunt of crisis at hand can be satisfied, for the reality of crisis is that life, and the means with which to sustain and reproduce it, hangs in the balance.
Since the 2008 recession, the class divide has been driven deeper in the US, accompanied by a decade’s worth of political posturing over the “death of the middle class” in the wake of the housing bubble’s collapse. What is to be made of the “recovery” we have supposedly experienced since then? And what further to make of a “recovery” that continues to see intensifying austerity the world over, and massive demonstrations increasing in number against such measures before another recession has officially taken over on a global scale? What we see at present is that the “recovery” of the past decade is merely an even greater potential crisis merely deferred through the borrowed futures of credit, culturally felt as a suspension and malaise, a continuity of the perpetual crisis always waiting to burst forth. The nature of this eruption is that of a rapid destabilization immanent to the dynamics of capital accumulation. It manifests when the composition of capital and labor are, on the level of social expansion thus reached by capitalist development, such that its expanded reproduction is inhibited.
The disruption poses immense subjective potential before and after the event, in the orbit of its temporality. Capital’s profitability is always directly and adversely impacted by demands in the interests of labor. To sustain the reproduction of living labor is to do so at the expense of the self-valorizing potential its dead, objectified form takes as capital. A crisis is simultaneously the revelation of the weakness of capital in the face of the inner tension of its relations of production at a given historical moment, as well as its means of recomposing these relations according to the demands of its present composition once again. There is, in the orbit of a total social crisis, the contingency of the balance of class forces. The situation in which the bourgeois ideology of the imperial cores of today finds itself is a weakly sustained optimism in the absence of alternatives, while slowly becoming more aware of the true nature of its limits and the depth of the impasse upon which it has arrived, thus veering more overtly and rapidly into reactionary nationalism and protectionist trade policy. To understand this trajectory, we seek to break down the tendency towards crisis in the internal contradictions of the processes of capital accumulation and reproduction, to see the inborn limits to this that point towards the mode of production’s ultimate historical transiency, and the terrain of shifting balances of class power that we may exploit within the crisis tendency to achieve capitalism’s ultimate supersession.
These internal, contradictory tendencies form the basis of its tendency to erupt in periodic crisis, brief disruptions resulting from capital’s inability to reproduce itself as a mode of production and produce value at scale required for its expansion, which it must if it is to continue. Marx himself was clear in expressing the cyclical nature of crises and their regenerative function to the continuity of the mode of production:
“These contradictions, of course, lead to explosions, crises, in which momentary suspension of all labour and annihilation of a great part of the capital violently lead it back to the point where it is enabled [to go on] fully employing its productive powers without committing suicide. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow.” 
In this passage from the Grundrisse, one may be forgiven for overlooking the crucial part in the relation of crisis to the supersession of capitalism as a mode of production, that is, the necessity of this “violent overthrow.” There exists a perpetual temptation to see in every moment of our ongoing proletarianization and mass immiseration a moment by which we will be handed capitalism in tatters, flayed at our feet by its own design; the action on our part a matter of following through on what will present itself as self-evident. Such a destiny that sees history as a matter of mechanical processes in an objective determinism for our own purposes will never be the case. We may often give credence to the idea that a crisis stokes the fires of the oft-mythical weapon of “class consciousness,” but this too ceases to be true when we look and find intense and violent reaction close at hand. Even if indeterminate with respect to the struggle for emancipation, the phenomenon of an immanent crisis tendency evidences the transitory and fragile construction of the capitalist mode of production, a construction whose social constitution and conditions of possibility must be continually refounded. It is this process of reproducing capitalist social relations which is, therefore, inherently vulnerable to disruption. By emphasizing in analysis the points where subjectivity emerges, we may ascertain both the basic components of capital in terms of how they become objective in their function, as well as open to disruption. Subjectivity is the willed disruption of the ongoing process of objectification.What can at least be said to be true of crisis is its inevitability within the capitalist mode of production. Crisis is an innate dynamic present within capital’s laws of motion, and this too must lead us to acknowledge that the motive force of any crisis is the inner tension of the contradictory interests of labor and capital in their reproduction. “From time to time the conflict of antagonistic agencies finds vent in crises. The crises are always but momentary and forcible solutions of the existing contradictions. They are violent eruptions which, for a time, restore the disturbed equilibrium.” This conflict of antagonistic agencies may appear as the result of crisis, but is in fact the very determinant in the eventual rupture that takes place. It should be noted here that a theory of crisis tendencies is necessary, but not sufficient on its own for a theory of revolution. As these periodic ruptures break out, the struggle between classes intensifies and class struggle once again reveals itself to be the internal dynamic engine that drives capitalist development, allowing for its expansion or limitation. This intensification of class struggle does not necessarily yield the inexorable refoundation of capitalism; when the proletariat, in the course of the fractures, can amass sufficient social force to permanently disrupt capitalism’s ongoing operations, the discontinuity latent in crisis will be brought forth. A theory of crisis as a theory of the instability and narrow conditions of capital accumulation can be actualized in the flights and passages from cyclical crises to social irruptions to revolutionary situations. The constitutive elements of the event of crisis are always within it; crisis is immanent to capital.
- John Holloway, “Crisis, Fetishism, Class Composition” Open Marxism II (1992), p. 146
- We are using this hideous word here to keep in line with bourgeois economic theory, which denies that the owners of capital exist as a class – and so would never utter that ideological canard, “capitalist” – but treats them rather as simply the luckiest of the uniform spheres bouncing around the economy, who happen to own one of the numerous factors of production.
- Spoiler alert: it’s some kind of benign neglect eugenics
- Finance Capital, Hilferding (1912), p. 186, quoted in Marx’s Theory of Crisis, Clarke (1994), p. 31.
- Stabilizing an Unstable Economy, Minsky (1986), p. 158
- Marx’s Theory of Crisis, Clarke (1994), p. 42
- Grundrisse, Marx (1973) “Method of Political Economy,” p. 101. Here Marx is explaining his dialectical method of approaching organic wholes not as simple additive sums of “ever thinner abstractions” but building up to a “rich totality” of relationships.
- The peculiar condition of the proletarianized subject is to be alienated from means outside the market and thus dependent, directly or indirectly, on the social wage fund. Dispossessed of alternative reproductive social forms, survival comes to be mediated by the relation of production. One must work to live, and is therefore reduced to living in order to work; but the availability of work is not a guarantee. It is not exploitation as such which defines the proletariat, as this is contingent upon the variable state of productive forces and much else, but real or virtual poverty, the expulsion from social metabolism, which is imposed in order to make them exploitable. See Michael Denning, “Wageless Life” New Left Review 66, pp. 79 – 97.
- The force of the proletariat’s antagonism is rooted in the objective existence of profound needs that capitalism is constitutively incapable of satisfying. In fact, such social needs are subordinated to the need of the value form to expand, use-values are consumed as a footnote to the expansion of the circuit. Thus, the contradiction between needs is an irresolvable and unstable unity in the capital-labor relation. See Agnes Heller, The Theory of Need in Marx, 2018.
- Grundrisse, Marx (1973) “Capital as Fructiferous, Transformation of Surplus Value into Profit”, p. 750
- Capital, Volume 3, Part 3 Chapter 15: “Exposition of the Internal Contradictions of the Law [of the Rate of Profit to Fall]”