Book review: Does Capitalism Have A Future?

Book review: Wallerstein, Immanuel et al. Does Capitalism Have A Future? Oxford: Oxford UP, 2013.

(crossposted to Firedoglake and to

This book is a "response" anthology, with the lead author being Immanuel Wallerstein, prominent world-systems theorist, laying out his hypothesis for postcapitalism. Even though I am sympathetic to Wallerstein's hypothesis, I find its logic a bit brief. Wallerstein argues that a number of trends in present-day world-society will converge and produce a transition to a postcapitalist world-society, and that what is going on now is the struggle to define what the world after capitalism will be like.

Here is a short list of the trends Wallerstein cites:

1) Financialization has granted inordinate economic power to the most predatory form of capitalism -- for-profit lending.

2) There are "hegemonic cycles" which (Wallerstein claims) put a limit upon the ability of a hegemonic power (in our present day, the United States) to maintain its dominant position. Wallerstein thinks the hegemonic position is shifting toward the BRICS countries (Brazil, Russia, India, China, South Africa) without any possibility that they themselves will become hegemonic.

3) The capitalist system is running out of "room to move" -- there are no great new reservoirs of resources to exploit.

4) The cost of inputs (wages, resources) is going up

5) Tax burdens are becoming heavier

6) Environmental crises (global warming etc.) are becoming deeper

The problem with this sort of theory (as I see it) is that if you only identify a number of trends for why capitalism is entering a period of ever-greater crisis, you still haven't identified a primary necessary reason why capitalism won't survive all of the trends you cite. One of the things Wallerstein is up against is the common presupposition that "the economy" exists independently of Earth's ecosystems, so that the predictions on Wall Street can assume endless growth regardless of what the dire predictions of "peak oil" or "global warming" assume. It is in this economy-ecology linkage that I think the main reason for capitalism's demise will be found.

The most basic remedy for this economy-ecology divide is to view the capitalist economy as Paul Prew does, as a "dissipative system." Here is how Prew describes the "dissipative" dilemma facing world capitalism today:

World capitalism now faces two ecological options. Do we proceed with capitalism until we reach an ecological bifurcation point that leaves the habitability of the earth in question for the vast majority of the population? Or will we reach a bifurcation point that leads toward an alternative system of production that is (also) dissipative, but less threatening to the flowing balance of nature? To accomplish the latter, we must begin to nudge the trajectory of the current social system of production in the direction of a more harmonious relationship with nature. To seek short term solutions or reforms to the current system may help increase the instability of the capitalist system necessary for its eventual transition, but a “reformed” capitalism is not sufficient to salvage our relationship with nature.

"Does Capitalism Have A Future?" does not appear to be at the point in the discussion where it is willing to take on Paul Prew's subject matter. Now, to be sure, Wallerstein gives a timetable for the changeover to postcapitalism. There will be a struggle to determine the shape of postcapitalism, and it will take place in the next thirty years: "what we need to analyze are the probable organizational strategies on each side in this struggle that started more or less in the 1970s and will continue in all probability to circa 2040 or 2050." (33) However, some of the other authors (Michael Mann; Craig Calhoun) still don't see, in this regard, why we can't have "the good capitalism." Oh, sure, they recognize the environmental threat to capitalism -- but they argue as if environmental considerations are an afterthought to be "added in" to an economic discussion that doesn't reveal any imminent possibility of collapse for the capitalist system.

At any rate, marxist economic theorists (and we can count Wallerstein as a marxist in a sense), are fond of noting that capitalism periodically undergoes "crisis" without any deep consideration of how "crisis" might merely diminish the strength of the capitalist system without landing any sort of knockout blow to the system itself. The standard marxist explanation of "crisis," then, trumpets the vulnerability of the capitalist system while reminding us that only if the economy is reoriented through working-class revolution will capitalism be ended. This, however, is also not necessarily so -- we just don't know for sure. The dissipative aspect of capitalism may yet transform the relations between the social classes so thoroughly that what results after "crisis" is no longer capitalism, but rather (as Wallerstein points out) something worse than capitalism. I can imagine, for instance, a neofeudalistic social order in which one signs a feudal contract online, through the Internet.

In summary, I feel Wallerstein is essentially right, but there's an economy-ecology connection he hasn't made. In the other chapters of "Does Capitalism Have A Future?", Wallerstein's respondents tried to reason through his trends, adding a few more of their own. In the following paragraphs I will go through their arguments, highlighting the interesting while mentioning the routine in passing.

Randall Collins, a sociologist from Penn, also thinks capitalism will be toast. His prognosis:

The bottom line remains: technological displacement of the middle class will bring the downfall of capitalism, in places where it is now dominant, before the 21st century is over. Whether these transitions will be peaceful or horrific remains to be seen. (69)

Collins may be right but for the wrong reasons. He argues that some sort of middle-class revolt will occur upon their gradual unemployment due to automation technology, whereas an alternative scenario is actually developing in the world, in which "employment" consists largely of defending the increasingly aggressive capitalist police state in this time of increasing economic insecurity. The revolt against this scenario may take the form one could see in the Taksim Square uprisings in Turkey, in which protesters attempted to create an alternative to bad governance in general.

Michael Mann, the next author in this anthology and a sociologist at UCLA, argues from a model of human society in which he does "not conceive of societies as systems but as multiple, overlapping networks of interaction, in which four networks -- ideological, economic, military and political power relations -- are the more important." (72) Unfortunately, this perspective doesn't help readers understand capitalism any better. He disputes the model of economic growth filling up planet Earth as follows:

If there is no cheap labor left, capitalists can no longer reap superprofits from this source, but the higher productivity of labor and increased consumer demand in newly developed countries might compensate for this and produce a reformed capitalism on a global scale, with more equality and social citizenship rights for all. (87)

I am unclear as to where the resources for this presumed future of high labor productivity are going to come from, if capitalism is maxing out our planet. At any rate, Mann claims to be agnostic about whether or not capitalism will survive the current set of crises, without any serious calculation of where we are headed. Maybe technology will save capitalism, as he claims -- but Mann doesn't seem to have much of an idea of how technology will save capitalism.

At this point in my reading I was thinking that both Collins and Mann needed to read David Graeber's piece in the Baffler titled "Of Flying Cars and the Declining Rate of Profit." Graeber makes an effective case, I think, for why we are not today experiencing the technological utopia of "The Jetsons" or of "Star Trek" or of anything out of the imaginations of 1960s science fiction optimists. Graeber argues that capitalism has developed in a paranoid, elitist fashion, and dragged technological progress with it:

A case could be made that even the shift to research and development on information technologies and medicine was not so much a reorientation toward market-driven consumer imperatives, but part of an all-out effort to follow the technological humbling of the Soviet Union with total victory in the global class war—seen simultaneously as the imposition of absolute U.S. military dominance overseas, and, at home, the utter rout of social movements.

For the technologies that did emerge proved most conducive to surveillance, work discipline, and social control.

We can say, for instance, that even that most popular of technical innovations, the Internet, was originally part of a Department of Defense project. So this is why automation will not give us the world promised us in "The Jetsons" -- our capitalist governments, fearing in paranoid fashion for the future of their beloved system, have steered technical "progress" in the direction of social control. Revolt against global social control, then, may be the basis of the opposition.

Georgi Derluguian has a short "response" in this book, after Mann's chapter, about the collapse of the Soviet Union. The idea for including this chapter was that the collapse of the Soviet Union might give readers some hints about the collapse of the capitalist economy, but if Derluguian is correct in arguing that the Soviet Union was a government that assumed the role of a monopoly corporation, then the collapse of the USSR was really more like the collapse of a large corporation, say for instance Washington Mutual, rather than being anything like the here-anticipated collapse of capitalism itself. You might think of "actually existing socialism," then, as like a corporate mission statement for a state-capitalist "socialist" state.

The last respondent in "Does Capitalism Have A Future?" was Craig Calhoun, now "Director of the London School of Economics and Political Science." Even though I couldn't really agree with his perspective I found Calhoun one of the most interesting of the respondents, for the critical issues he brought up. Calhoun is famous for having put out some important volumes in critical theory (in Jurgen Habermas's circle of academic friends), and so I read his stuff avidly back in the 1990s. It interested me to know what he was doing these days. Calhoun is also skeptical about whether or not capitalism is going to collapse any time soon, though he has a very succinct description of the problem with capitalism:

The expansion of capitalism has not only depended on states and societies, but on the exploitation of nature. In each of these three cases, capitalism is destructive of conditions on which capitalism depends, and extreme financialization and neoliberalism exacerbate this tendency. The future survival of capitalism depends on whether ways can be found to limit or reverse this destruction without eliminating capitalism. (146-147)

Here we run into an interesting problem of perspective. Why not eliminate capitalism's destruction without worrying about whether or not capitalism survives? Oh, right, capitalism. Clearly, though, in tackling the capitalism-environment problem head on, Calhoun is onto something. He continues:

Because nature-as-resources always appears limited and capitalism is organized as a system of perpetual expansion, capitalism also nurtures efforts to transcend the limits of nature. The combination of modern science with business and government backing has been remarkably productive of new technologies. Those include engineered resources to augment natural ones, such as improvements in agriculture, new materials, and new ways of extracting energy. Capitalism has thus been basic to increased capacity to support human life, complementing "natural" potential with intensified agriculture based on fertilizers, mechanization, drainage and irrigation, and new crops based on research. (153)

This is as vital an insight as the whole book produces, yet Calhoun needed to read Jason W. Moore's essay "Cheap Food and Bad Money" here, to understand why technology won't save capitalism now even though it has done so in the past. Moore argues that capitalist technology, by which we mean technologies created by working inventors but produced and distributed along lines laid out by capitalist managers, once opened up new "cheap resource" opportunities for capitalists. Cheap food, essentially, is a resource that can be productive of cheap labor, in an era in which cheap energy and other natural resources are available. Moore argues, moreover, that new technologies today are not opening up new "cheap resource" opportunities, but are, instead, maintaining profit rates while the era of the "cheaps" is disappearing. Technological progress continues, then, while at the same time the capitalist system continues to head into increasing crisis.

Calhoun seems to hesitate in making linkages between capitalist forms of life and the operation of the capitalist system itself. He argues that, with capitalist development, "the new organization of social life has also multiplied demands for energy, met especially by carbon sources from coal to petroleum but also by nuclear and other forms of power." (153) But what Calhoun describes is not just an organization of social life, but rather an organization of global economic markets on the basis of cheap, plentiful fossil fuels as used today on an enormous scale. This is a matter of market infrastructure, not just of "social life." Arguably, without capitalism, i.e. without an infrastructure designed for "market competition" and corporate profit, we could have a far less wasteful world-system which would at the same time be better at satisfying the needs of the human race than capitalism has been.

Moreover, the result of more capitalism as such will be profound alterations in Earth's atmospheric balance (thus "global warming") and impending global shortages in energy inputs for the fossil-fuel infrastructure (thus "peak oil.") This isn't merely due to a "new organization of social life," nor is it merely an additional byproduct of capitalist development, but rather it's the expected result of capitalist development.

I can't say I didn't like this book. It's nice to have Wallerstein's theory of postcapitalism laid out in concise fashion. But I felt that it needed to go to the next level in its analysis of postcapitalism. And what's with all the men? They couldn't find any woman writers on this topic? Are we to feel that world-systems theory is largely the province of males?

Recommended, with objections.




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