Capital strike. Now that’s a name I’ve not heard in a long time. But it’s not dead . . . not yet.

The idea of a “capital strike” has been around forever. It’s the obvious complement to the labor strike: just as workers can shut down production by refusing to come to work, capital can shut down the economy by refusing to invest and hire workers. You can find discussions of capital strikes during the Great Depression. But as a theoretical concept, the capital strike was popularized by the neo-Marxist theorists of the 1970s and 1980s. Adam Przeworksi used it in Capitalism and Social Democracy to explain why reformist projects of redistribution ultimately run up against a revolutionary limit. He notes that:

Under normal circumstances it can be expected that the increase of aggregate demand should stimulate investment and employment. Redistributional measures . . . are usually justified by appeals not only to justice but also to efficiency. (Przeworski, p. 44)