see the more recent, and far superior, draft here.
The Left Forum is next weekend at Pace University in NYC. I’m speaking on two panels on Sunday: David Harvey and Capitalist Accumulation; and a roundtable on Andrew Kliman’s new book The Failure of Capitalist Production.
Below is a rough draft of paper for the former panel. In case you were wondering, no David Harvey is not going to be at the panel. My paper is an attempt to summarize a longer paper of mine which critiques many of his positions on crisis theory, focusing primarily on his 1981 book Limits to Capital. There is certainly much editing in front of me in the coming week getting this ready for the Left Forum, but the draft below at least has the structure of the argument worked out. I am always glad to hear responses, feedback, criticism, etc.
The Enigma of the Enigma
The aim of this brief talk is to provide the beginning of a critique of David Harvey’s theory of crisis. But I have to start by saying how humbly I approach this task. Like many people, I am greatly indebted to David Harvey. In many ways Harvey was my first access into the world of Marx. His clear, articulate language, his passion for his subject material, and his patient dedication to pedagogy were a big influence on me, compelling me to dig deeper and deeper into the world of Marx and Marxism. The criticism I offer here is made with the deepest and most sincere respect for his work.
My critique is of 3 intertwined aspects of Harvey’s work: his rejection of Marx’s theory of the Tendency of the Rate of Profit to Fall (TRPF), his theory of ‘overaccumulation’, and his use of this ‘overaccumulation’ as a framework for his geographical analysis.
Much of 20th century Marxism is defined by its defeats, both theoretical and political. As much as we have to learn from our elders, we also must remember that they have their origin in a certain time and place and that their approach to Marx is informed by this origin. For Harvey the time is the 1970’s and the place is the western academy. It is a time and place where Marxists were facing certain theoretical challenges that they were unable to respond to, forcing them to revise or reject key aspects of Marx’s value theory. They were also faced with the need to distance themselves politically from the horrors of Soviet Marxism and Maoism. This led to several distinctive characteristics of what I call here ‘the 70’s Marxist’.
Aspect 1: Anti-orthodoxy
The 1970’s was a time of challenge and defeat for Marxists but these experiences also opened up space for new approaches to Marx and to reappraisals. The bitter end of the Stalin-era (marked by Khrushchev’s secret speech in 1956) provided a space for a critique of so-called “orthodox Marxism”, allowing for a reappraisal of Marx himself, not filtered through the politics of the Soviet era. This combined with a trend of academic Marxism, tracing itself back to figures like Paul Sweezy, who worked to establish more space for Marxian ideas in the academy by developing a non-sectarian Marxist tradition which often borrowed language and tools of neo-classical economics. On the positive side, this has led to some great scholarship and debates on many topics from dialectics to value theory to the labor process, revealing the great depth and richness of Marx’s analysis, and freeing Marx from the stodgy determinism of the Iron Curtain. On the other hand there has been too great, and often too superficial, a rush to distance oneself from this so-called “orthodoxy”, often confusing this “orthodoxy” with Marx himself (throwing out the marx-baby with the orthodox bath water). Public speak events require a ritualistic, undeveloped castigation of some aspect of Marx in order to prove to the audience that one is not a Stalinist. The charge of “orthodox marxism”, has too often been used as a rhetorical weapon to silence critics. Thinkers who have sought to defend key aspects of Marx from revision have been accused of dogmatism, inflexibility and sectarianism. A false-dichotomy between “open-minded reinterpretations” and “deterministic orthodoxy” is too-often erected as a substitute for a real argument. While I admire much of Harvey’s work as a Marxist pedagogue I also think that he sometimes suffers from this 70’s vibe of anti-orthodoxy. Limits to Capital, for instance, is riddled with dead ends and pointless asides spent critiquing Marx where there is no critique to make (for instance, the pages and pages spent pontificating about the transfer of value from fixed capital, none of which accomplishes anything, see my critique elsewhere). More relevant, Harvey seems to brush aside contemporary debates around the TRPF, dismissing these ideas as the work of orthodox dogmatists rather than actually engaging with them.
Aspect 2: theoretical retreat
As 70’s Marxists wrestled with their identity in the post-Stalin era they also had to fend off the theoretical assault of the Sraffian’s, the transformation problem, and the Okishio Theorem. The inability of Marxists of this era to defend Marx’s transformation procedure or the theory of the Tendency of the Rate of Profit to Fall (TRPF) (discussed later) produced a myriad of theoretical approaches, all attempting to rescue some aspect of Marx from the burning wreckage of Marxism, while erecting work-arounds, synthesis with other traditions, etc. The end result of most of these efforts was often pathetic, forcing many to abandon Marx altogether. Those who tried to remain within the tradition often were only able to do so by drastically reducing the radical scope of the Marxist project, adopting an entirely un-Marxist framework, focusing on the non-economic aspects of Marx, or creating vague reformulations which side-stepped these problems in a dialectical sleight-of-hand. “Marxian” replaced “Marxist”. I consider Harvey’s crisis theory to be such a vague reformulation.
But the vague reformulation, the work-around, is not the result of some reformist politics. Rather, it shows the fidelity of many thinkers to the Marxist project despite the theoretical obstacles in their path. But when we maintain fidelity to the ‘essence’ of Marx, while abandoning his logic we get ‘Marxiness’.
Aspect 3: do it my own way
It seems almost every book on Marx written in the last 40 years must have as a subtitle “a reinterpretation”, “a reformulation”, or “a critical appraisal”. Academic careers were made based on the uniqueness of one’s reinterpretation. Putting a distance between oneself and Marx certainly makes one more palatable to the academy. But I suspect that the larger factor in this is the nature of academic careers in general which tend to foster individualism and originality in theories. Harvey’s crisis theory is one of these original contributions. Much of his career is based on the reformulation of Marx’s crisis theory that he develops in his 1981 Limits to Capital. (But it is not wholly original. It begins by trying to vaguely reformulate Marx’s TRPF in order to side-step the Okishio Theorem. But it also attempts to use the language and tools of the Monopoly school though without the underconsumptionism usually associated with this school.)What emerges is a highly original, yet sometimes confusing, distinctly “Harveyian” crisis theory.
I don’t think it works for the following reasons: The language of ‘overaccumulation’ that he borrows from the Monopoly school cannot effectively explain the cyclical nature of capitalist crisis. The lack of a mechanism within the theory that creates this cyclical motion forces Harvey to ascribe too much explanatory power to the agency of political actors. Without the TRPF there is theory that can explain why capital would ever overaccumulate in the first place, that is, why there would ever be a shortage of profitable investment opportunities. I think that these problems rob his geographical project of its potential power.
Let’s get into it…..
Thinking back to my first encounters with Harvey’s writing, reading the Condition of Postmodernity as an undergrad, I remember the excitement that his geographical project had on me. In a college environment of identity politics and postmodernism, where culture was used to explain politics, where ‘meta-narratives’ were akin to totalitarianism, David Harvey’s ability to provide a fresh materialist analysis to culture was a breath of fresh air. By focussing on the way capitalist accumulation constructs its own version of space and time his writing was able to pierce through the fragmentation and nihilism of the dominant postmodern narrative, and provide a materialist framework with which to understand the lived experience of capitalism in all of its diversity and complexity.
Often as an undergrad I had been told that Marxist analysis was reductive, that it predicted a uniform lived experience, that it proscribed a politics that ignored differences between people, rejecting many forms of struggle to focus narrowly on workplace struggles. Harvey showed that it was possible to theorize a great diversity of experiences of capitalism as well as a great diversity of struggles against capitalism, within a marxist framework.
This is the real strength of his project. It represents some of the best aspects of the 70’s Marxist. Marxism of the 70’s needed to escape from the determinism and narrowed politics of the so-called ‘orthodox marxism’ of the 2nd and 3rd Internationals. It needed to show that Marxism was an open, developing body of theory, capable of theorizing the continuing evolution of capitalism in all of its complexity and diversity.
But the 70’s Marxist too often threw out the Marx-baby with the orthodox-bath-water. Often times this was the best that could be done at the time as theoretical defenses of key aspects of Marx’s value theory had not been developed yet. MORE ON THIS BELOW. The best thing that could be done was to side-step these criticism of Marx, developing alternative approaches. Harvey’s work-around is this theory of over-accumulation.
What is missing in his theory?
For Harvey, capitalists are in a constant state of anxiety because they must turn their money into more money. They must constantly find new avenues for profitable investment. But the amount of value that needs to be valorized keeps increasing and so their task gets harder and harder. Eventually this growth reaches limits. It begins not just to accumulate, but to overaccumulate. The attempts of capitalists to overcome these limits is what particularly interests Harvey. Investments in fixed capital, public works, infrastructure, etc… The entire construction of physical space, and the organization of time are bound up in this attempt to deal with the overaccumulation of capital.
“The Marxist argument is, then, that the tendency toward overaccumulation can never be eliminated under capitalism. It is a never-ending and eternal problem for any capitalist mode of production. The only question, therefore is how the overaccumulation tendency can be expressed, contained, absorbed or managed in ways that do not threaten the capitalist social order.” (The Condition of Postmodernity p.181)
This becomes a very powerful tool for Harvey as it allows him to explain all of space and time, more or less, through the problem of overaccumulation, or surplus value absorption, or as he says in Enigma, the problem of surplus. But the problem is that his theory explains too much. Like his theory of Accumulation by Dispossession, the categories are extended too wide; too much is explained; it’s too easy.
How can the boom in construction at the start of an economic boom (say the 50’s in the US) and the boom in construction that accompanies a credit bubble right before a crisis (say the 2000’s) both be a result of overaccumulation? Here the same geographical phenomenon, the rapid construction of spaces, exists at two very different places in the accumulation cycle. The dominant forces of a boom can’t be the same as those of a bust. We need a theory capable of explaining cyclical movement.
Harvey talks a lot about the creation of difference through the uneven development of capital in space. These differences are often due the contingent aspects of the flow of capital through spaces, local advantages and barriers, the irregularities of fixed capital, etc. This is all great and usefull. But his theory of overaccumulation also has a monotone quality to it, one that can’t theorize other types of difference. Again, I refer to the long-term cyclical movements of profit rates, and the accompanying booms and busts which have occurred regularly throughout the history of capital. If overaccumulation is a chronic condition, this suggests a steady stagnation, not cyclical motion.
So I don’t think overaccumulation can explain the cyclical motion of crisis. But I also don’t think overaccumulation can explain overaccumulation.
If capital is overaccumulating due to a shortage of profitable investment we need some theory of the growth of capital relative to investment opportunities- or, I should say, relative to profitable investment opportunities.
Historically theories of overaccumulation are associated with the underconsumption school of thought which argues that low wages create a situation of not enough consumer demand which means product can’t be sold, capital overaccumulates, etc. Harvey seems to endorse this thesis in Enigma, even though he critiques the theory earlier on in Enigma, and many of his earlier works. (This, I must confess, I find confusing.) His critique I agree with: capital has the ability to generate its own demand through the expansion of capital goods. (see Kliman’s new book.)
If Harvey rejects the underconsumption argument then what is the cause of overaccumulation? At his worst, Harvey sometimes seems to suggest that overaccumulation is its own cause and effect. Just the very fact that capitalism must constantly grow is used to suggest that this growth will hit a limit at some point. This aspect of his theory seems to have become more blatant since the crisis. It emerges quite strongly at times in Enigma and in recent speaking engagements. I think it is mostly a result of trying to communicate his ideas with lay audiences. But it has the danger of evoking an “anti-growth” aesthetic similar to the ‘small is beautiful’ politics of primitivists, anarcho-libertarians, apolitical environmentalists and hippies. It borders on vulgar populism. And it has no theoretical meat: he must provide a reason why capitalism can’t expand forever.
Now, Harvey does have a better answer to the question. He often argues that there are multiple Limits to capitalist production. This, for him, means that the specific limit operating at any particular place and time is contingent. Many of the limits Harvey talks about have to do with the temporal barriers to production generated by the complex overlapping of different turnover times, transportation, and the use of the credit system to overcome these limits, which generates its own speculative impulses.
This idea of a plurality of limits can seem attractive at first. It definitely gets anti-orthodoxy points due its ability to embrace many different interpretations of crisis. But I worry that it ignores the mechanism by which capital overcomes its limits: profit. Profit reapportions investment to areas with high return, and takes investment out of unprofitable areas. Now, of course this is not always successful for every individual capitalist. Of course there is a lot of unevenness due to all of the factors that Harvey discusses. But it is no good to just stress the limits and ignore the elephant in the room: the profit rate.
It turns out that capitalism is remarkably good at overcoming barriers. It is an overcoming marked by all sorts of violence and unevenness, but it is an overcoming. Now when a crisis erupts this is qualitatively different than the sorts of minor fluctuations and unevenness that I think Harvey’s limits imply.
If profit is the mechanism for overcoming these ‘little-limits’, we need a theory about profit rates to explain the ‘big-limit’ that is a crisis. Of course, this is Marx’s theory of the Tendency of the Rate of Profit to Fall (TRPF): technological change eliminates human labor in proportion to total investment which causes a long-run fall in profit rates. As profits fall, there are less opportunities for profitable investments, capital bunches up… it ‘overaccumulates’, crisis erupts.
Harvey isn’t willing to take Marx’s approach to the problem, even though his theoretical framework seems to demand to be completed by a theory of profit rates.
Why he rejects the TRPF
I suspect that Harvey’s gravitation towards developing some version of an overaccumulation theory is in many ways a result from his inability to find a way to make Marx’s TRPF work. 70’s Marxists wrestled with the TRPF and often came out rejecting the theory. They were up against the logic of the Okishio Theorem, which claimed the exact opposite of what Marx claimed: rather than labor-saving technology causing a fall in the rate of profit, Okishio aruged that it must always raise the rate of profit.
The inability of Marxists from this period to save the TRPF from Okishio led many, including Harvey, to develop alternative crisis theories. Math is math and you can’t argue with it. But you can argue with the presuppositions behind the math. This is what the TSSI does to the Okishio theorem. It questions the assumptions behind the theorem and shows that Marx’s theory of the TRPF is totally consistent. Because there now exists a refutation of the Okishio Theorem, I no longer believe it is defensible to just write off the TRPF in a current book on crisis. It also demands that we return to the debates around crisis that happened in the 70’s and reevaluate the conclusions that people like Harvey drew from them.
I have a rather detailed critique I have made of Harvey’s take on the TRPF in Limits, but here I will summarize:
Harvey’s chapter (it’s actually a sub-chapter) on the TRPF could be the poster child for the 70’s Marxist. It starts with a hint that there is something wrong with Marx’s theory, though it is very hard from the chapter to find out what this is. It begins with a very thorough, detailed description of all of the different possible criticisms of the theory, all of the counter-tendencies that might raise the profit rate, etc. One by one Harvey dismisses these critiques, arguing that they are not adequate to forestall a fall in the profit rate. Then comes this very interesting sentence:
“Van Parijs (1980), for his part, uses a proof of Okishio’s (1961) to show that capitalists, under competition, will choose techniques which necessarily reduce the unit values of all commodities (including labor power), and increase the transitional rate of profit to themselves as well as the social rate of profit, no matter what happens to the value composition, provided only that the physical standard of living labor remains constant.” (p. 185)
Now, nowhere does Harvey actually explain what this means or how this argument is proven. We are, I guess, just supposed to take the word of Van Parijs that we should take the word of Okishio. For a reader new to Marx, as I was when I first read Limits, this paragraph produces a deal of head-scratching. We have just read pages of elaborate details about the TRPF that turn out to be dead ends (failed critiques, counter-tendencies, etc.). Now we are finally given a definitive statement that the TRPF is wrong and David Harvey, the Marxist pedagogue, does not offer to give his readers any explanation.
This spectral appearance of Okishio becomes a turning point in the text. Okishio seems to be haunting the text. Harvey doesn’t want to directly confront Okishio. Instead he develops a very complicated and obtuse sidetrack about turnover time, credit and constant capital that attempts to rescue what it can of Marx’s crisis theory. In the end Harvey concludes:
“individual capitalists, acting in their own self-interest under the social relations of capitalist production and exchange, generate a technological mix that threatens further accumulation, destroys the potentiality for balanced growth and puts the reproduction of the capitalist class as a whole in jeopardy.” (p.188
This appears to be nothing more than a vague restatement of the TRPF. The only difference is that Harvey puts the question in the language of equilibrium states. It is hard to see how recasting the same theory in vaguer language really rescues it from Okishio. If Harvey had just left things here his work would probably not have been that note-worthy. But, Harvey doesn’t just leave things here. He uses this vague defense of Marx a springboard for his own theoretical riffing: In the next chapter the camera has panned away from the discussed of the limits to profitability and zoomed in on the issue of the rising surplus. Here the language of overaccumulation begins.
This strange, ghostly encounter with the repressed spectre of Okishio provides us with a template for the 70’s Marxist.
1. Sraffian critiques of Marx are side-stepped in an attempt to save Marx by being vague.
2. This vagueness becomes a platform for erecting original reformulations.
3. The reformulation takes on a life of its own, and the relation to the original debate is forgotten.
4. The reformulation is conflated or confused with Marx’s crisis theory.
In order to question these theories we have to interrogate each of these:
4. We must separate Marx’s own theory from those of the “Marxits”, “Marxian”, “Marxoid”, etc.
3. We must acknowledge and understand the original debates that gave rise to these reformulations.
2. We must interrogate reformulations and challenge them to be clear, not evasive.
1. We must challenge Marxists to deal directly with the charges of inconsistency that have been leveled against Marx in the academy.