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Daniel Bensaïd: The rhythms of capital. On Mandel's The Long Waves of Capitalist Development

19 February 2024
Ondes longues du developpement capitaliste

At the end of the Second World War, the revolutionary movement faced an unexpected situation.i The bureaucratic Soviet regime had not only survived the war, but appeared to be expanding in Eastern Europe. Capitalism, out of breath in the 1930s, seemed to be regaining strength.

In 1947, the young revolutionary activist Ernest Mandel at first clung to the idea that this boom was just a short-lived respite before a new revolutionary upsurge. Observing the effects of the Marshall Plan in restoring production and stabilizing the situation in Europe, at the congress of the Fourth International in 1948 certain Trotskyists, such as Tony Cliff and Nahuel Moreno, were more puzzled. When it became clear that this was indeed the start of a period of sustained expansion, Ernest Mandel set about elucidating the enigma of capital's new-found vitality. His theoretical reflection on cycles of accumulation and crises is one of the main threads running through his economic work, from Marxist Economy Theory (original French publication 1962) to Long Waves of Capitalist Development(1980), via Late Capitalism (original publication 1972), The Second Slump (1979), and the introductions he wrote for Penguin editions of the three volumes of Capital.ii

How can we explain the renewed dynamism of capitalism during the 'long boom' of the post-war years? And why did the end of the Second World War, unlike the 1920s, not result in the rebirth of a powerful revolutionary movement in the developed capitalist countries? Mandel's answers to these questions were never simplistic. Major economic trends are closely interwoven with technological innovations, social struggles and political events. In the 1960s, Mandel was one of the first to resume the debate on capitalist development cycles, which had been interrupted in the 1920s, on the basis of a re-reading of Kondratieff, then a victim of the forgetting organized by Stalinist orthodoxy. While in Marx the 'regular periodicity' of crises exclusively concerned the crises of the industrial or commercial cycle, occurring approximately every decade, from the beginning of the 20th century fluctuations of a different scale were statistically recorded by academic economists (such as Jean Lescure and Albert Aftalion) and socialist theorists (such as Parvus and Van Gelderen). But the first synthesis correlating long movements in prices and production was made by N.D. Kondratieff in articles and lectures from 1922 to 1926.iii Since the work of Simiand and Schumpeter during the interwar period, however, the theory of long business cycles had fallen into disfavour. The expansion of the post-war boom, the attenuation of short cycles and the relative effectiveness of counter-cyclical policies fed the illusion that the spectre of crisis had been exorcised once and for all. At a time when the theories of equilibrium, organized neo-capitalism and controlled growth seemed to be triumphant, Mandel was one of the few authors to defend and develop the theory of long waves. Although many of the questions raised by this theory remain unanswered, in response to the long depression that began in the 1970s the long-wave hypothesis has nevertheless become an established part of research programmes.iv

Mandel was also one of the first to grasp the historical significance of the shift, whether in cycle or wave, that occurred in the mid-1960s-1970s, and to offer a complex interpretation that could not be reduced, as in conventional economics, to a mechanical effect of the 1973 'oil crisis'. In light of this shift, he developed the terminological distinction between cycle and wave, aiming to correct the mechanistic interpretation to which the notion of cycle could lend itself. To this end, he took up the problem sketched out by Trotsky in the 1920s. In his June 1921 report to the Third Congress of the Communist International, 'The World Economic Crisis and the New Tasks of the Communist International', Trotsky took issue with those who drew a mechanical link between the economic crisis and the revolutionary situation. And in his 1923 article 'The Curve of Capitalist Development', Trotsky again stressed, against Kondratieff, the complexity of the links between economics and politics: 'It is a very difficult task, impossible to solve in its full scope, to determine those subterranean impulses which economics transmits to the politics of today'. In Trotsky's view, cycles have a real explanatory value, but these cycles cannot 'explain everything: this is excluded, if only for the reason that cycles themselves are not fundamental but derivative economic phenomena.' If capitalism were to be characterized only by the recurrence of cycles, history would be just 'a complex repetition and not dynamic development'.

One of the major problems posed to revolutionaries at the end of the 1970s by the start of a new long depressive wave was (and remains) that of the conditions for a new expansive wave. While a downward turn can be understood theoretically in light of the tendency of the rate of profit to fall, an upward turn seems to require a radical modification of the balance of forces and of the political and institutional conditions for the valorization of capital. Mandel stressed that the originality of his own conception of 'asymmetrical long waves' was in the fact that 'we base ourselves on the relative autonomy of the subjective factor and conclude that the outcome of the depressive long wave is not predetermined (it depends on the outcome of class struggles between living social forces).'v He thus repudiated the economism and determinism handed down by the Second International. The opposition between 'endogenous' (economic) factors which would determine the downward turn of the wave, and 'exogenous' (extra-economic) factors which would determine its upward turn, however remains dependent on an over formal separation between economics and politics, objectivity and subjectivity: 'For all the indicated reasons, we stick to our concept of a basic asymmetric rhythm in the long waves of capitalist development in which the downturn (the passage from an expansionist long wave into a depressive one) is endogenous, whereas the upturn is not, but rather is dependent on those radical changes in the general historical and geographic environment of the capitalist mode of production that can induce a strong and sustained upturn in the average rate of profit.'vi

Ernest Mandel's thinking was thus opposed to both the kind of harmonicist simplification according to which capitalism had overcome its inner contradictions and achieved unlimited growth, and to catastrophist simplification, which insisted on denying the new forms of global capitalism in order to continue prophesying its final crisis. This position put Mandel in the middle of a crossfire, as he was at times accused of prophesying an improbable crisis, and at other times of giving in to the siren calls of the idea of a 'neo-capitalism' that had overcome its contradictions. Yet such contradictions remained very real in his eyes. They were leading not only to a generalized crisis in social relations, but also to a crisis in cultural relations and in relations to the natural conditions for the reproduction of the species. His research programme proved exceptionally fruitful. Whereas the dominant economic theory had been built, as Francisco Louçã reminds us, 'on the Newtonian characteristics of an atomistic universe', Mandel's theory of long waves was 'essentially historical and conformed to the epistemological requirements of a realist approach to economics.' In order to elucidate the conjunction of tendential regularities and periodic irregularities, Mandel opposed mechanistic Marxism and the 'mystique of equilibrium' of classical economics with the notions of 'partially autonomous variables' and 'dialectical determinism'.vii

Mandel thus takes up and develops Marx's dialectical logic, at work in the third section of volume III of Capital, on the tendency of the rate of profit to fall: 'this double-edged law of a decline in the profit rate coupled with a simultaneous increase in the absolute mass of profit, arising from the same reasons.'viii A strange law indeed, this 'tendential law' which contains causes that 'counteract' and develops its own 'internal contradictions'. Such formulas imply a causality that is different from the classical mechanical and linear causality of cause and effect. Mandel insisted that the dynamics of an expansionary phase cannot be explained by the logic of 'capital in general' alone. It involves 'a whole series of noneconomic factors like wars of conquest, extensions and contractions of the area of capitalist operation, intercapitalist competition, class struggle, revolutions and counterrevolutions, etc.'ix

Ernest Mandel thus distinguished economic cycles from 'a long cycle of rise and decline in working-class militancy and radicalization' 'that is relatively independent of the long waves of more rapid accumulation and slower accumulation, although to some extent interwoven

with them.'x The task of empirical verification of such a 'long cycle of class struggle' remains. Some have tried to accomplish it.xi The first difficulty lies in the indicators used and their reliability. Assuming they can be resolved (through rigorous statistics on strikes, electoral results, union membership and social movements), we could undoubtedly establish a relationship between economic fluctuations and social conflict. However, this link would not be sufficient to explain the periodicity of a long cycle of class struggle, unless we were to go round in circles and deduce it (rather mechanically!) from the economic cycle! To the end of his life, Ernest Mandel dreamt of a theory of the cycles of class struggle that could be dialectically articulated with that of long waves. This dream of formalization was undoubtedly unattainable, insofar as it came up against the complex effects of the discordance of times.xii

In the third chapter of Long Waves, Mandel assesses the historical development of capitalism in light of the changes that have taken place since the First World War; 'From then on, we entered a new historical period involving both relative decline and geographic contraction of this mode of production. The victory of the Russian revolution and the subsequent losses suffered by the international capitalist system in Eastern Europe, China, Cuba, and Vietnam are significant expressions of that reversal, although by no means its only expressions.'xiii

Since these lines were written, Russia and China have been reintegrated into the world of market-driven globalization. Without social protection, millions of workers in these countries have been brutally thrown into the global labour market. Despite the worldwide defeats inflicted on the workers' movement, despite the recovery in profit rates, and despite the financial performance of multinationals and pension funds, the depressive wave has not turned upwards. We find ourselves on the threshold of a new era, very different from the post-war era whose enigmas Ernest Mandel strove to decipher. It is up to the new generation to learn how to use the conceptual tools he bequeathed them in order to decipher those of the present.

i This text was originally published as the preface to Les ondes longues du développement capitaliste. Une interprétation marxiste (Paris: Éditions Syllepse, 2014). Text from Translation by Alex de Jong.

ii The original edition of the book on long waves was published in English in 1980 under the title Long Waves of Capitalist Development: A Marxist Interpretation (C.U.P.)

iii See the articles published and presented by Louis Fonvieille under the title Les grands cycles de la conjoncture (Paris: Economica, 1992).

iv See Bernard Rosier and Pierre Dockès, Rythmes économiques (Paris: La Découverte, 1983); Bernard Rosier, La théorie des crises (Paris: La Découverte, 1987); Jean-Paul Fitoussi and Philippe Sigogne (eds), Les cycles économiques (Paris: Presses de la Fondation des sciences politiques, 1994); Francisco Louçã, Turbulence in Economics: An Evolutionary Appraisal of Cycles and Complexity in Historical Processess (Cheltenham: Edward Elgar Publishing, 1997); Chris Freeman and Francisco Louçã, As Time Goes By (London: Oxford University Press, 2001); Robert Brenner, The Economics of Global Turbulence (London: Verso, 2006). However, an author like Makotoh Itoh only accepts the long-wave hypothesis as the outcome of an empirical observation with a poorly established theoretical status: 'The long-wave theory recently presented in Mandel's Late Capitalism should not obscure the unified nature of this stage, with its characteristic regular cyclical crises. The long-waves theories rather should be seen as attempting to generalize the historical experiences of the great depressions at the end of the nineteenth century and in the 1930s. I strongly doubt if they can be proved as a constituent element of Marx's theory of crisis.' (Value and Crisis: Essays on Marxian Economics in Japan, London: Pluto Press, 1980, p. 141).

v Long Waves of Capitalist Development, p. 40.

vi Ibid., p. 42.

vii Ibid., p. 115.

viii Marx, Capital, vol. III (London: Penguin Books, 1981), p. 326.

ix Long Waves of Capitalist Development, pp. 16, 17.

x Long Waves of Capitalist Development, p. 38.

xi Among others, see: G. Gatteï, Every 25 Years? Strike Waves and Economic Cycles, international colloquium on long waves and the economic conjuncture (Brussels, 1989).

xii For Henryk Grossmann, attempts to transform political economy into an exact science are trapped in one-sided quantification that prevent thinking about the temporal dynamics of disequilibrium. Quoting P.W. Rosenstein-Roda, Grossmann writes; 'the ''equilibrium system'' of the mathematical school only exists by virtue of the fact that it represents ''economics without time.' 'The equilibrium system of the mathematical school, which embraces neither indices nor coefficients relating to time, can in no way capture the real state of equilibrium.' 'Its only merit, so to speak, is to constitute an ''atemporal economy''' (Henryk Grossmann, 'Marx, Classical Political Economy and the Problem of Dynamics', Capital and Class, part I, summer 1977 (2): pp. 32-55; part II, autumn 1977 (3): pp. 67-99, 77). According to Grossmann, the dynamic economy obeys a logic of disequilibrium that modifies classical notions of law and causality. Marx asserts that 'law is determined by its opposite, absence of law', so that 'the true law of political economy is chance' (Comments on James Mill, Éléments d'économie politique []). Laws can assert themselves only as 'blindly operating averages between constant irregularities' . Marx, Capital, vol. I (London, Pengiun Books, 1979), p. 196). This asymmetrical logic of disequilibrium in particular concerns long waves.

xiii Long Waves of Capitalist Development, p. 49.

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