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Understanding Crises

by Bill Dunn on August 29, 2014

My book on The Political Economy of Global Capitalism and Crisis has been published by Routledge in their RIPE Series in Global Political Economy. The book is trying to apply a Marxist understanding of capitalism to the recent crisis. It is making an argument that we need theory but cannot jump straight from Marx’s Capital to the current mess. Marx himself advocated a method of movement from the abstract and general to the concrete and specific, which too few Marxists have followed.

DunnAs I say at the beginning of the book, ‘existing accounts of the crisis, and for that matter of social life in general, tend to fall into one of two camps. The first camp is that of over-simplification. It is tempting to reduce complex social phenomena to a few formulae . . . On the other hand, oaths are sworn against determinism and deductivism and prohibitions made against attempting to impose analytical order on what is acknowledged as a complex social existence. We are left with unexamined prejudices’. We need theory and I think we need Marxist theory, but this should be of an open and anti-dogmatic bent.

I think Marxism, suitably conceived, is also perfectly capable of incorporating observations made by people working in other traditions and of deepening their insights. I am all for building bridges but I want people to cross them in a Marxist direction rather than disappearing off into liberal pluralism. So I start with some quite general discussions, along the way making original contributions to value theory and crisis theory. In both cases I’m arguing for something a bit broader than conventional wisdom has it.

On crises, I am making the point that capitalism goes into crises for different reasons. This is obvious in fact and theory needs to be able to cope with it. Too many critical political economists have a pet theory of crisis which they try to force onto every historical situation. Capitalism’s contradictions are more complex than that. From too many of his followers you might wonder why Marx wasted all those words when what he had to say can be captured in a couple of simple formulae. Any adequate theory of crisis must be synthetic, incorporating different dimensions of capitalist production and reproduction. Crises are also literally ‘turning points’ and theory should also be able to make sense of the processes of recovery as well as downturn. Historically, capitalism has recovered from its crises, only to hurtle down new and ultimately unsustainable paths.

So any particular crises cannot be deduced just from an abstract analysis and an adequate understanding requires a concrete investigation of the way the different and often contradictory tendencies of capitalism play out. Amongst other things, accumulation is also mediated by state interventions and international relations. The book therefore moves on to discussing how and why we had a ‘Keynesian’ period, why this went into crisis, how this crisis was fought out and finally how this sent us down new trajectories and towards new dislocations.

I have put ‘Keynesian’ in scare quotes here because the period of the long post-WWII boom owed little to the ideas of Keynes but it was one of rising investment and rising wages and intensive capital accumulation concentrated in or near to existing sites of wealth within rich countries. We have gone down a very different path in the last 40 years.

One aspect of this was increased financialisation. But the crisis of 2007 and after does not make sense as just a financial crisis while financialisation itself has to be understood in the context of the redirection of capital accumulation in response to the crisis of the 1970s.

The publishers gave the book its current title. I had wanted to call it Dislocations of Capital. That was a bit of a play on the word dislocation, about how things go out of joint but also about how the spatial dimensions are crucial to the process. In general terms I’m trying to think through the geographical dimensions of uneven and combined development, why we get simultaneous tendencies to agglomeration and dispersal and how these play out at different times. This helps in explaining the current crisis in terms of looking at how the geography of accumulation has changed and how this is related to changes in trade and debt and financial flows.

I want to develop the geographical aspects a bit further in the future and at least I can recycle that original title.

Bill Dunn
Bill Dunn works in the Department of Political Economy at the University of Sydney. His principal research interests are in the contemporary global political economy of labour, crises, international trade and Marxism.

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