Crisis of capitalism?

Howie Chodos howie at
Sat Apr 29 15:13:28 MDT 1995

Scott's recent reply to Guy Yasko started me thinking about a basic issue:
is capitalism in crisis? This would seem to me to be a pretty important
question of concrete analysis with implications for all aspects of left
strategy. Scott argues that not only are we already in the midst of an
"economic and social crisis of capitalism" but that it is getting worse,
compounding the "the structural crisis (S&T revolution) hit with such a
storm in the early Reagan years". And furthermore, "the demise of socialism,
warts and all, has greatly increased the potential for war and fascism". My
inclination is to disagree with this analysis.

Scott uses the term crisis in a variety of ways, economic crisis, social
crisis, structural crisis. The first question then is, what is a crisis? It
seems to me that for the term to be a useful one we need to have a way of
distinguishing between periods of crisis from periods of non-crisis. There
is a tradition of analysis which sees capitalism as having entered into a
period of "general" crisis, which IMO tends to obliterate this distinction.
There is even some of this in Lenin's _Imperialism_ with the notion of
moribund capitalism. At the same time, if memory serves, Lenin had a pretty
good idea of what constituted a revolutionary crisis, that is where the
ruling class can no longer govern in its habitual way and where the
subordinate classes no longer accept to be governed.

I would suggest that in economic terms growth is one indicator to look at in
assessing whether we are in a crisis period or not. This is admittedly a
limited criterion, and the one preferred by mainstream economics (i.e. the
definition of recession being two successive quarters of negative growth, I
think), but it does provide a basis for differentiating the moments of
various economic cycles. In political terms stability would seem to be a
useful indicator. We could look at the extent of popular opposition (mass
movements, etc.) as well as at the regularity and "normalcy" of the various
political processes. If we take "social crisis" to refer to things like the
stability of family life, the effects of various corrosives on people's
lives (crime, drugs, etc.), similar criteria could be applied to establish
the extent to which there is a crisis.

The question of crisis or not overlaps with, but is not identical to, the
idea that capitalism is an oppressive and exploitative system. Whether or
not there is a crisis there will be people suffering from the "normal"
functioning of capitalism. There are several reasons it seems to me to
matter whether or not there is a crisis. First, if Marxism has value it
should, and here I am drawing on some of Justin's recent arguments, produce
positions which help us understand and explain the world out there. So,
almost as a matter of principle, we should strive to get it right. Second,
at some point in time it may matter whether we succeed in taking advantage
of a crisis to actually bring about radical change. Third, the assessment of
the state of the economy will likely have an effect on how we go about
various short-term tasks as well. For example, whether a particular strike
is winnable or not may depend on the overall state of the economy and a
given firm's position within it.

All in all it seems to me that to conclude that capitalism is today in a
state of crisis is to interpret the notion of crisis as a long-term,
quasi-irreversible, nearly-permanent state. There are certainly major
changes taking place both economically and politically which are having many
adverse effects on millions of people's lives. But I cannot see that it is
educationally useful to call this a crisis, and I think that we run the risk
of committing strategic errors in planning our work if we base it on such an

One final point. I think that disagreements of this kind are healthy and
inevitable. There will not necessarily be a clearly signposted border
separating the land of crisis from the land of non-crisis. We need to be
able to debate these matters openly and non-dogmatically, and to work
together despite the disagreements we may have.

Howie Chodos

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