Business as Usual: the Economic Crisis and the Failure of Capitalism

Reaktion Books (London), 2011

Paul Mattick’s Business as Usual is an attempt to come to grips with the global economic crisis that began in 2007 in Marxist terms, an entry into a growing category books which includes David Harvey’s The Enigma of Capital. Mattick (son of the late council communist Paul Mattick) argues that, contrary to views of the entirety of the world of economists and business journalists, the ongoing crisis (ongoing in the sense that economies of Europe and the U.S. are inextricably interrelated) fundamentally reflects the dire problem of profitability for capitalism. However much the economists may wish to trumpet the long-awaited turnaround, the threat of depression and war haunt a system running out of options.

Mattick provides a bracing reminder of the reality of the nature of the capitalist system in his analysis of the limits of Keynesian stimulus policies:

From the viewpoint of economics—including most left-wing approaches—the point of an economy is the allocation of resources to meet consumption needs. The chief issue distinguishing conflicting viewpoints, then, is what sort of economy—what mix, for example, of market and state planning—does the best job of promoting the public welfare (the wealth of nations). This is why most economists, including Keynes, think of profit-making as a device for getting people with money to invest in the production that seves consumption. And this is what allows a contemporary Keynesian like Paul Krugman to ignore the imperative of profitability and insist, in making an argument for a massive stimulus program, that “under current conditions, a surge in public spending would employ Americans who would otherwise be unemployed and money that would otherwise be sitting idle, and put both to work producing something useful.” But capitalism is a system not for providing “employment” as an abstract goal but for employing people who produce profits; its goal is not the production of useful things but the increase of capital.

 Mattick excels in the anti-Keynesian argument so neccessary today (Naomi Klein should put this book on her reading list) as well as in his passages on the enormous role of the state in the capitalist economy, but in his stated aim of avoiding “jargon,” he constructs a critical structure lacking a treatment of  the foundation of the origin of profit: surplus value (the word “value” does not appear in the book) and the abstract labor that produces it. This stems from Mattick’s appearent interpretation of Marxism as a critique of political economy, rather than a philosophic criticism not only of political economy, but of the subjective assumptions that underlay it. The fetish of the commodity, as Marx criticizes it in Chapt. 1 of Capital, is neither an economic nor a sociological category, but rather a philosophic predicate of capitalist “civilization.”

Because of this sociological truncation of Marx’s thought (one he shares with David Harvey), the criticism offered in Business as Usual is ultimately inadequate. It should be read, however, as the puncturing of the balloon of dominant economic thinking it delivers is a salutary one.

(The excerpted passage is from Chapter 5: “Appropriate Policies”)