Logicians of Capital

Riley’s admonition is a reminder of the strange itinerary that “the structural logic of capital” has traced over the past century and a half. Karl Marx was the great pioneer of the concept of course. His lifelong intellectual project was to uncover the system’s inner “laws of motion” and then to ask: If you have a society propelled by such inner dynamics, in what direction is it likely to go?

His answers to that question almost always involved some mechanism by which capitalism could be shown to be undermining itself or preparing the ground for socialism: Competition bred ever-bigger factories that required ever-more sophisticated planning of production. Capital accumulation gathered up scattered proletarians from the global countryside and concentrated them in crowded factory towns where they could learn of their common interests and organize against the system. And so on.

For Marx, reform was another of these dialectical boomerangs. Capitalism could not stop breeding movements to reform capitalism. These movements had the effect of strengthening the political muscles and sense of self-efficacy of the working class, and this, for Marx, was yet another example of the system putting shovels in the hands of its own gravediggers.

The leading instance of such reforms in Marx’s writings was the English Ten Hours Bill (in its several iterations), the object of a great working-class movement in the era of Owenism and Chartism — “a thirty-years’ struggle fought with admirable perseverance,” as Marx recounted in his 1864 inaugural address to the International Workingmen’s Association.

And he was unequivocal about the outcome: the reform legislation limiting the length of the working day had been a smashing success. “The immense physical, moral, and intellectual benefits hence accruing to the factory operatives, half-yearly chronicled in the reports of the inspectors of factories, are now acknowledged on all sides.”

But besides all this, the movement yielded another great benefit.

Throughout the struggle for ten hours, a constant line of attack by bourgeois writers opposed to the reform had been that, if enacted and enforced, the legislation, by driving up production costs, would spell economic calamity for British industry — harming the very factory hands it was designed to protect.

In other words, though they may not have used the phrase, the bourgeois opponents of the Ten Hours Bill were appealing to the structural logic of capital to demonstrate the folly of the reform.

For Marx, one of the great achievements of the ten-hours agitation — on a par with the actual improvements in the health and happiness of the workers that resulted — was precisely how it discredited that kind of critique, and how it vindicated the idea of “social production controlled by social foresight” even within the bourgeois mode of production:

There was something else to exalt the marvelous success of this workingmen’s measure. Through their most notorious organs of science, such as Dr. Ure, Professor Senior, and other sages of that stamp, the middle class had predicted, and to their heart’s content proved, that any legal restriction of the hours of labor must sound the death knell of British industry, which, vampirelike, could but live by sucking blood, and children’s blood, too. . . .

This struggle about the legal restriction of the hours of labor raged the more fiercely since, apart from frightened avarice, it told indeed upon the great contest between the blind rule of the supply and demand laws which form the political economy of the middle class, and social production controlled by social foresight, which forms the political economy of the working class.

Hence the Ten Hours’ Bill was not only a great practical success; it was the victory of a principle; it was the first time that in broad daylight the political economy of the middle class succumbed to the political economy of the working class.

If any “structural logic of capital” was at work in the saga of the ten-hours movement, for Marx, it lay in capital’s endemic tendency to generate reform movements in opposition to itself — not, as the middle-class “sages of science” had claimed, in condemning any reform measure to futility.

The Logic of Capital, Vol. 1

If we fast-forward a century or so, however, we find these intellectual positions drastically reconfigured.

By the middle of the twentieth century, the political economies of the industrialized world had been transformed by forms of state intervention that Marx and his comrades in the International Workingmen’s Association could scarcely have imagined. Wide swathes of industry were nationalized. Wage schedules were set in national agreements. Capital-controlled banking systems were under the thumb of national central banks, now accountable to finance ministries that answered to parliaments elected by universal suffrage. Governments committed to full employment held jobless rates to levels once thought impossible.

Intellectuals on the right wing of the socialist and labor movements — neo-revisionists like the British author and politician Anthony Crosland — began claiming that in this new era of full employment and uninhibited economic management, capitalism had ceased to be capitalism and the workers’ movement no longer needed to push for any deeper transformation beyond an endless series of piecemeal reforms.

It was in this context, in the ’60s and ’70s, that self-consciously “revolutionary” writers on the Left seized on the notion of a “structural logic of capital” as a weapon in the fight against the new revisionism.

“If the capitalist mode of production can ensure, with or without government intervention, continual expansion and full employment, then the most important objective argument in support of revolutionary socialist theory breaks down,” wrote David Yaffe, a key figure in the “capital logic” current of intellectual Marxism, in a 1973 article.

It was thus vital to furnish arguments showing why such a stabilization was impossible, and this was done — in works by such writers as Paul Mattick and Roman Rosdolsky — by plucking out of relative obscurity a suggestion that could be found in scattered passages of Marx’s voluminous economic writings but had, until then, only occasionally been the focus of sustained consideration from Marxists: the idea of a lawlike tendency for the profit rate to fall.

The great nineteenth- and early twentieth-century defenders of Marxist orthodoxy, most prominently Karl Kautsky and Rosa Luxemburg, had been dismissive of falling-profit-rate theories on the rare occasions when they felt the need to acknowledge them at all, and certainly did not believe that such a tendency could be granted a central role in Marxist crisis theory. (Luxemburg was especially biting in her disdain for the idea. Responding to an enthusiast of the theory who had reviewed her Accumulation of Capital in a German socialist newspaper, she wrote: “There is still some time to pass before capitalism collapses because of the falling rate of profit — roughly until the sun burns out.”)

But since the 1970s, the canonical status of falling-profit theory in the corpus of orthodox Marxism has become a kind of “invented tradition.” Its centrality in the pantheon of Marxist ideas, though widely seen as primordial, is no more than a few decades old, and its function has always been ideological: to demonstrate the futility, perversity, or jeopardy of social democratic reforms.

I’ll save for a subsequent article a more thorough discussion of the various theories of falling profit — including the novel version advanced by the UCLA economic historian Robert Brenner, which has become something of a house theory at the New Left Review over the past twenty-five years.

Suffice it to say that when the New Left Review invokes it to warn that the “structural logic of capital” will somehow render futile measures to promote green technologies, due to a “massive exacerbation of the problems of overcapacity on a world scale,” it illustrates the rhetorical dilemma of an “anti-reformist” left whose struggle against anachronism has forced it to stand Marx on his head.