Interesting Piece on Marx and the Crisis

by Chris Sturr | October 22, 2008

From Stumbling and Mumbling. Hat tip to Economist’s View. I don’t agree with all of this, but it’s thought-provoking:

Marx: less relevant

The credit crunch is making Marx fashionable again. Which I find odd. Strictly speaking, this crisis has made Marx less relevant, not more.

Our current crisis is a less Marxist one than almost any post-war recession.

To Marx, crises originated in the real economy. Recessions occur when an over-accumulation of real capital equipment combine with a lack of demand to cause a falling rate of profit and then capital-scrapping, job cuts and slump.

Now, this was a great explanation for previous recessions. The long boom of the 1950s and 60s led to over-accumulation and falling profits and the recessions of the 70s and 80s. The tech bubble of the late 90s caused a massive over-accumulation of capital and nugatory profits. It’s this stress upon profits that elevates Marx and his follower such as Kalecki above mere Keynesians.

However, this is a poor description of our current woes. Non-financial profits have been reasonably healthy. Instead, this crisis originates in the financial system.

Read the rest of the article

Leave a comment

Leave a Reply

%d bloggers like this: