Frenetic Standstill

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At the extreme, signs and significations which are nothing more than significations will lose all meaning. At the extreme looms the shadow of what we will call ‘the great pleonasm’: the unmediated passing into the unmediated and the everyday recorded just as it is is everyday—the event grasped, pulverized and transmitted as rapidly as light and consciousness—the repetition of the identical in a wild whirling dance devoid of Dionysian rapture, since the ‘news’ never contains anything really new. If this extreme were reached, the closed circuit of communication and information would jeopardize the unmediated and mediated alike. It would merge them in a monotonous and Babel-like confusion. The reign of the global would also be the reign of a gigantic tautology, which would kill all dramas after having exploited them shamelessly… It would be a closed circuit, a circuit from hell, a perfect circle in which the absence of communication and communication pushed the point of paroxysm would meet and their identities merge. – Henri Lefebvre, Critique of Everyday Life, Volume II

Lately I’ve been reading through a rather interesting book that somehow slipped beneath the radar, despite being focused on my long-running obsession with the strange architecture of modernity’ temporality: Hartmut Rosa’s Social Acceleration: A New Theory of Modernity. The sense of acceleration characteristic of ‘classical’ modernity is not something that I’ve talked much about in the scribblings on this blog, having opted instead to look at the inverse that I think is more characteristic of our postmodern or late modernist condition—the sense of atemporal stagnation, declining progress and exhausted slowdown that was once described under the gloomy sign of ‘decadence’. So far my three bigger posts on this topic have been “Spatialization of Time/Temporalization of Space”, “Decadence & (Po)Mo” and “Catastrophic Marxism in the Age of Decadence”.

In the first, I tried to correlate these two orders of time—compressive and accelerative transformation and stasis—to the dialectical unfolding of space and time that Marx found operating in different ways at different points of the capitalist reproduction cycle and associated historical tendencies. The second post was about drawing parallels between the epoch that we describe as postmodernism and the era of cultural ennui and apocalypticism that held sway in Fin de siècle Europe. The third, finally, was a reading of catastrophist Marxism—which overdetermined the prevailing interpretations of Marx’s crisis theory with a mechanistic vision of capitalist breakdown and Kladderadatsch—as a political iteration of this same condition, with a correlation drawn between decadence and the “long depression” of the 1870s-90s. The further implication is that we can find in postmodernism an unconscious cultural reflection and articulation of a similar situation: the “long downturn” that has persisted since the 1970s.

One of the important things to note is that while the classical age of decadence and contemporary ‘postmodernism’ are comparable and reflective of similar trend-lines, there are also stark diverges. It was Frederic Jameson who wrote of decadence as something of a ‘foreshadow’ to postmodernism, but that in many respects, the postmodern condition is one that is worse and more protracted that this earlier mode. Decadent society was one both entranced and enthralled with entropy, which first stamped its mark on social consciousness in the 1860s as yet another great humiliation, one tearing at the fabric of the ideological fantasies of uninterrupted progress and civilizational march. Because entropy is still an affair of directionality (it provides, after all, the arrow of time in a physical sense), so too did decadent society move in particular way. It moved, at a ever-slowing pace, towards the great frozen end: the dimming sun and humanity’s grand buildings and machines coated in vines and rust—and, finally, the heat death of the cosmos itself.

Postmodernism for Jameson is something different. Entropy may still be a force recognized in popular (and unpopular) imagination, but it no longer operates as an arrow of time. Instead, we’ve faced with timelessness itself and the total supremacy of the same space stretching out in all directions, streaking off into horizons that are standing, paradoxically, just before our eyes. Not even the real threat of absolute catastrophe unmoors us here. In The Progress of This Storm, Andreas Malm describes climate change as a sort of ‘revenge of time’ against postmodern spatial domination, writing that “We can never be in the heat of the moment, only the heat of the past. Insofar as extreme weather is shaped by basal warming, it is the legacy of what people have done, the latest leak from a malign capsule—indeed, the air is heavy with time”. But even if we now “inhabit the diachronic”, as Malm says, this has done little to dent the widespread experience of living in posthistorie.

How to make sense of this paradox, where diachronic transformation fails to dint superstructural synchronic space? One can find traces of this non-conflict not only in the cultural response to climate change, but in the freight train of political events and the pace of life itself. From the declining existence of free time to the relentless barrage of political crises and even the recent near-brush with large-scale geopolitical war, space appears full of discrete events. And this brings me back to Rosa and his book, where we find the term to perfectly encapsulate this experience: the frenetic standstill. A twist on Virilio’s notion of ‘polar inertia’ (a “pathological fixedness”), Rosa defines the frenetic standstill as an abyssal scenario that constitutes the flipside of Jünger’s total mobilization—which was, of course, an expression of the developmental sublime at its most vitriolic, a violent joy at a great machinic arrangement seizing the whole of the globe and plunging it into the future. Rosa writes that

political events again take on the situational character of episodes and are comparable to… compressed episodes of individual experience… However, because they lose their status as elements of a meaningful historical chain of development and can no longer be transformed into genuine historical experience (Erfahrung) in Benjamin’s sense, they also lose any (“deeper”) significance in general, as countless cultural (and pop-cultural) observers of the present attest. Quite in the spirit of Marx’s dictum that history only repeats itself as farce, the documents of contemporary culture observe (occasionally even very turbulent) historical events in terms of the peculiar waning of their personal and collective significance. “From the turn of the twentieth century up to the present, the semantics of time has developed from a field upon which there are still victories to be won to an area in which all battles have already been fought and nothing more can happen,” as Nassehi summarizes this feeling of an end of history; his summary is confirmed by Imre Kertész, the Hungarian winner of the Nobel prize for literature in 2002, who writes: “everything keeps on going, but somehow flatter, if also more bluntly.”

Elsewhere in Social Acceleration, Rosa describes the frenetic standstill as a “decelerating force”, a “tendency towards rigidity” and “return of the ever same”. While this return of the same—or bare repetitionis meant first and foremost to define the repetition of the present itself within the (eternal) present, it seems to me that it could also be used to define another curious hallmark of the present moment, which is the flight into a sort of unproductive anachronism. Just as Malm’s poisoned air diffuses within the present the actions of the past with little cultural effect, so fragments of past cultural forms and even more recent recombinations of these forms come to circulate endlessly, colliding and mixing into ever more strange hybridities. These cultural artifacts are symptoms of a chronosickness (to borrow Alex William’s term to describe the postmodern flight into “kitsch retro-futurism”), the most illustrative example of which might be this cursed meme recently shown to me by Cockydooody:

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If chronosickness diagnoses the constant collisions of past forms with the wall of frozen time, this seemingly pointless meme reflects the immense piling-up of broken pieces and turned-over scraps. The quote is from the Atrocity Exhibition by J.G. Ballard, an author whose works continually probed the interzone between hyper-modern acceleration and exhausted obsolesced through experiments with uncanny occurrences and anachronistic encounters. The font and coloring, meanwhile, brings to mind both the title card of Twin Peaks and the aesthetic templates of vaporwave—both of which engage in a strange time-scrambling, the former by dragging the 1950s into the late 1980s and the latter by dragging the anticipated futures of the 1980s into the 2010s. And, finally, the picture itself, borrowed from Fallout New Vegas: a game that depicts the leveled future of an alternative future where the 50s returned in full force. Importantly, the post-apocalyptic desert of New Vegas is not the “desert of solace” pursued by the Church fathers and hermit monks, but a desert that is teeming with events and haunted by the ghost of Great Politics (with all the required nods to Hegelian dialectics and Walter Benjamin). In a very real sense it too is a depiction of the frenetic standstill: what’s left of human community might be locked into a timeless moment and even on its way down, but events that resemble history continue to take place. Even the franchise’s motto, which alludes to an unchanging nature of things, situates these events not as unfolding in the context of a grand narrative (even if some players on the stage read it this way), but on the treadmill of eternal mechanical repetition, the bad infinity. In Fallout, not even the literal apocalypse can alter this bleak fate.

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A dynamic similar to Rosa’s frenetic standstill is traced by Guy Debord in his late Comments on the Society of the Spectacle. There, Debord was concerned with a historical evolution in the nature of the spectacle itself. In the United States and Western Europe, the ‘diffuse spectacle’, typified by a relatively mild bureaucratic order and the proliferation of commodities, had reigned, while the ‘concentrated spectacle’, based on a ‘controlling center’ promoting a singular social vision, held sway in countries such as the Soviet Union. Both of these, however, were superseded by the rise of the ‘integrated spectacle’—’integrated’ because it was the merging of the logics of both the diffuse and concentrated spectacles, on the basis of the diffuse spectacle itself. The spectacular society, in other words, now operated in a way that its operations were maintained by a controlling center, one regulated the logic of capitalist production and exchange, that remained occulted, hidden from view.

There are “five principal features” of a “society whose modernization has reached the stage of the integrated spectacle”, which Debord lists as “incessant technological renewal; integration of state and economy; generalized secrecy; unanswerable lies; eternal present”. Of these, ‘generalized secrecy’ and ‘unanswerable lies’ are indicative of the ‘conspiratorial turn’ of Debord’s thought, which emerged in the aftermath of the Years of Lead in Italty and the subsequent revelations of the state security services’ role in perpetuating terrorist attacks to justify crackdowns. This wasn’t, however, the flight into unabashed conspiracy theorizing as it was the articulation of a new sort of epistemological uncertainty that underpinned social order: lies that unanswerable means that we cannot, ultimately, discern whether or not they are lies or the truth. Truth, by extension, is extinguished as a political force, and the efficacy of public opinion as a democratic tool is annihilated. This is exacerbated by the role of generalized secrecy, which for Debord is “the most vital operation” of the integrated spectacle, and acts as the “decisive complement of all its displays”. Between generalized secrecy and unanswerable there emerges a society swarming with apophenia, misdirection and noise, all of which work together to produce a new sort of political order just as quickly as they grinds the gears of traditional mass politics to a halt.

Incessant technological renewal and the eternal present are more directly relevant to the question of the frenetic standstill. Debord writes of a “recent acceleration” of technological development that has served to “reinforce spectacular authority”—and this language is telling. Rosa’s own analysis of acceleration as something intrinsic to modernity is routed through an understanding of a historical trajectory embattled by repeating waves of technological innovation. It’s also something to be found in Marx, with his emphasis on the introduction of new machinery as a means of speeding-up of production (alongside an increase in the productivity of labor), and the importance of investments in means of transport and communication to decrease turnover time, which is to say, to increase the pace of the whole vital circuit. The latter stands at the basis of contemporary theories of space-time compression, the dynamism through which time horizons tend to collapse and the obstacles posed by space are eliminated. Reality itself seems to speed up as the globe itself shrinks.

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But if we are going constant technological transformation, and such transformations constantly remake our world, then how do we end up with this other angle that Debord identifies, that of the eternal present? Debord suggests that the eternal present is induced by the forceful eradication of historical knowledge and memory, which is a point that conforms to permanent technological renewal: one simply doesn’t have the time to grasp a foothold and hang onto the present past. This too the ultimate conclusion that Rosa comes to, with the frenetic standstill being the index of a kind of psychic shock arising from the overwhelming of the senses by hyper-kinetic modernization.

However tempting these reading is, based on the relentless rush of individualized and discontinuous events, it seems to me that this cannot be the explanation, as this experience is taking place not within an explosion of innovation and change, but in the context of a protracted downturn. It’s the same problem that arises when we seek to apply Marx’s theory to the reality of the economic environment: we can tell, from both measures derived from Marx and from the mainstream economic toolkit, that the rate of profit has fallen—yet at the same time, it was Marx that argued that the rate of profit falls in proportion to the rising productivity of labor through increasingly mechanized production. The situation that we’ve seen since the 1970s, with a notable exception in the mid-1990s, has been different: productivity has stagnated in comparison to the period prior to the 1970s. This can be viewed through the measure of productivity as the ratio of output to labor hours and also through more neoclassical models such as total factor productivity; in the case of the latter the following chart from Robert Gordon is particularly telling:

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source: The Rise and Fall of American Growth: The U.S. Standard of Living Since the Civil War

At first blush this might seem like a counter-intuitive claim—after all, it appears difficult to imagine that growth in productivity has slowed across this period, because it appears undeniable that ‘incessant technological renewal’ is a reality. This question, then, is one of to what degree this technological change is really innovative, in the sense that it breaks paradigms, transforms the condition of labor and social life and increases the robustness of production. Gordon takes up such a question in a recent paper for the National Bureau of Economic Research, writing that while he is “impressed by the frenetic pace of innovation”, doubts linger for him as to the “strength of its impact on productivity growth”. There is no doubt this pace is a reality; for example, “[t]he number of U.S. patents issued increased by 27.9 percent between 2006 and 2016, even faster than the 24.2 percent decadal increase from 1996 to 2006, which in turn was more rapid than the average 17.4 percent per-decade increase between 1956 and 1996”. But is are these innovations really innovative as such? And what does it mean to be truly innovative? I’m reminded here of Boris Groy’s comment that “[a] new iPhone is not an innovation. It is repetition”, which falls so close to Peter Thiel’s declaration that he doesn’t “consider [the iPhone] to be a technological breakthrough”.

“The reevaluation of values is the general form of innovation”, writes Groys, explicitly aligning innovation with the Nietzschean project of the transvaluation of values. It’s a snaking underground chain of continuity: we should recall, on the one hand, that Joseph Schumpeter’s own definition of innovation, creative destruction, is traceable back to Nietzsche via the mediation of German economist Werner Sombart, while on the other, this concept is fully prefigured by Marx’s own comments on the unity of destruction and renewal exhibited by robust modernizing processes. If what we’re left with in lieu of technical and social transvaluation is simply modular repetition, the breakdown of the identity between ongoing technological change and innovation as such is clear. It also illustrates the economic and technical processes underpinning the frenetic standstill: everlasting change with the effect of deepening the bare repetition of present life. Society becomes trapped, to quote Henri Lefebvre, in “a wild whirling dance devoid of Dionysian rapture”.

Industrial Policy Round-Up #2

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Its been a little over a week since the first industrial policy round-up, and new news in this go-round has come at a much slower pace—with the notable exception, of course, being the unexpected turns in the recent UK election, which has brought with it some surprising turns and uncertainties, particular where economic questions are concerned. But before diving into British affairs, I’d first like to look at a piece that has gotten significant traction in the past days: a response posed to Marco Rubio’s interventionist program for a “common good capitalism” by Kevin Williamson at the National Review.

National Review‘s legacy is built on its role in helping engender a major shift in American conservative thought, being the place where fusionism (the unification of social conservatism with economic liberalism) was articulated and advanced. It had become closely aligned with the Republican Party in the 1950s, and sought out cooperation in particular with the segments of the party that made up the so-called “anti-New Deal coalition”. The echoes of this encounter have persisted through the years, with NR consistently taking aim at programs that would bolster the government’s role in managing the country’s economic affairs—and Williamson’s piece closely conforms to the common tropes offered up by this tendency:

Rather than monkeying around with things that are beyond his kin and outside the credible operating capacity of the U.S. government, Senator Rubio should be seeing to some of the things that actually might make a difference. The U.S. government is on a catastrophic fiscal course that will, without reform, eventually result in a ruinous debt crisis the likes the world has never seen. (We’ve seen fiscal crises in Canada and Argentina, but the U.S. economy represents nearly a quarter of the world’s economic output). We have entitlement programs that are in need of reform, decaying and archaic infrastructure under federal purview, serious K-12 educational problems entangled with federal policy, a tax code in great need of simplification, a series of worldwide military engagements that have failed or are on the verge of failing, enormous deficits, an out-of-control presidency and administrative state, etc., all of it under the responsibility of a federal apparatus that cannot even produce an accurate account of how many programs it administers. Senator Rubio and his colleagues are like fast-food workers who haven’t yet mastered the drive-thru but demand a seat on the board of the company: They are not doing a very good job with the responsibilities they already have.

Williamson’s argument revolves around what we might call, from our position in a world draped in the language of complexity and systems, a stigmergic understanding of capitalist development: capitalism advances through the rough-and-tumble world of the market’s self-organizing powers, where innovation and growth bubble up from the webs and conflicts of innumerable self-interested actors. This stigmergic understand is the natural counterpart—and outgrowth from—the flat abstractions of neoclassical economics, where issues of class, structural determinations and, importantly, the state bear little to zero imprint on the operations of these actors. He raises an important point when he notes that government fiscal policy is dependent on the capture of profits and incomes in the form of taxes (which brings the limits of the state into sharp relief when confronted with the issue of profitability crisis rears its head), but otherwise the account remains reductionist and lopsided—especially when considered from the point of view of American economic history, which pursued a radically different pathway than its cousin across the pond, Britain.

Williamson writes that the “things that gave Detroit its critical advantages in the early 20th century were not things that could be planned in advance by super-intelligence philosopher-kings in the bureaucracies”. It’s true that the absolute outcomes of actions cannot be drafted in advance, but its equally true that efforts to provide the frame for critical advantages was part and parcel of the early American experience. The program for the promotion of manufacture drafted by Alexander Hamilton might have hit road blocks and been mired in political gridlock, but as historians like John Lauritz Larson have shown, the cultivation of ‘internal improvements’ and other business-promoting measures was abundant and common, not only at the federal but also state level. In the case of Detroit, that critical advantage that Williamson applauds emerged in large part due to what was at the time one of the largest mobilizations of labor, money and resources outside of wartime. This was, of course, the construction Erie Canal.

That industrial policy programs are related to either the acceleration or restoration of profitability rates goes without saying—though some of the ways this takes place are saying. In the case of internal improvements, like the American projects to develop canals and vital infrastructure, what is at stake is the reduction of turnover time. This is the unity of the time of production and exchange. At the outset of a given production cycle, the capitalist must invest in labor, raw materials and the like up front—investments which are compensated for by returns generated by the successful realization of profits. The quicker the turnover time, the quicker this realization, and it is through investments in transport and vital infrastructures that this time is shortened. For people like Hamilton, the successful profitability of business was linked directly to the political standing of the nation: the state benefits from maintaining a consistent rate of return. It’s only a small leap from here to the ‘risk-bearing state’ that I mentioned last week, where the state takes the lead in fronting the investments for high-cost, high-risk, big pay-off ventures that private business is reluctant to engage in. Because there is a dialectical relationship between profits and investments (profit rates determine investment behavior, quantities of investment capital impact the rate of profit), it’s clear here too that the interest of the state in continued profitability is playing a clear role.

Finally, the turn of the state to industrial policy in times of crisis often entails ‘forcing’ investments where there are none, even if that goes against the interests of those holding onto to potential investment capital. Elements of this existed in the era of the New Deal, especially with the mid-1930s Revenue Acts that imposed wealth taxes on corporations and the country’s wealthiest individuals, though this side of the experiment has been overstated a bit (though important, we tend to forget that a major part of the New Deal was the encouraging of private investment, in manners akin to those I just described above). But it’s what is at the core of much of what is being discussed today, particularly in the form of the Green New Deal. Here, what is being proposed is that the state seizes the capital to become the investment apparatus itself, in order to funnel it towards productive, profitable—and hopefully ecologically sound—ventures.

When it comes to the ongoing discussion inside the Eurozone, it isn’t so much profitability itself, but questions of global political standing, that is taking point. This was touched on a bit in the last round-up, with the ongoing debates surrounding the EU’s perceived decline in the face of American and Chinese “technological supremacy”. Several reports have been issued by prominent European think-tanks, close to policy-making circles, that have reiterated this problem. One of these worth mentioning at length is a policy brief written by Kris Best titled “The Economics of European Sovereignty”. Best’s papers is published in the aegis of Jacques Delors Centre, the Berlin-based branch of the Jacques Delors Institute, a French think-tank committed to promoting an integrated and stable Europe (Delors, the founder of the institute, was Mitterand’s finance minister, president of the European commission and, notably, a proponent of European federalism)—and it is the preservation of the European Union, through both reinvigorating the continent economically and preventing governmental overeach, that is the goal.

First, a little background: in 2017, a deal was struck between the German firm Siemens and Franc’s Alstom to merge their railway businesses in order to create, in the words of a Reuters report, a “European champion”. The merger would have produced one of the strongest rail businesses in the world, one capable of overtaking the global railway supplier, China’s CRRC—but in February of 2019, the European Commission blocked the merger, citing worries over the impact it would have on innovation and consumer welfare. The result was an intensified debate over the merits of industrial policy and government intervention in the markets in general. In March, the Commission’s European Political Strategy Centre published a report titled “EU Industrial Policy After Siemens-Alstom” that opened with the observation that “[t]here is a palpable feeling that Europe risks being left behind unless urgent action is taken”. The urgent action came in the form of a recommendations comprehensive and multi-pronged approach, ranging from strengthening the World Trade Organization, expanding “trade defence instruments” (in short: protectionist measures to shore up domestic firms and markets against foreign competition), equalizing access to markets and, importantly, the promotion of “strategic investment” into “disruptive of breakthrough innovation”.

Best’s briefing takes cue from these debates; as she notes, the blocking of the merger “sparked a heat debate about whether EU competition policy is still in line with the realities of the new global economy. Those who supported the merger argue that the European Commission is preventing the creation of “European champions”, and that such things are necessary if the EU is going to continue to be competitive against China’s rising global influence. In response, the Commission has looked to reevaluating the Eurozone’s legal frameworks governing competition, with an eye towards cultivating a “long term strategy for Europe’s industrial future”. At the heart of this reevaluation is a series of questions posed by new technological developments—namely, artificial intelligence, big data platforms, and cybersecurity, as well as the significantly large role played by singular firms in making up the ‘infrastructure’ for this new economic environment.

In the proliferation of large-scale, surprisingly mutable information technology firms—what Nick Srnicek has described as platform capitalism—economic and technical power undergoes an intense concentration which leads them, inevitability, operate out of joint from the usual ‘laws’ of competition. But as market competition declines, competition between nations has been intensified, as countries and regions work with tandem with these economic giants. In the case of Europe, the lag is indeed palpable when one looks to the top twenty internet firms as sorted by market capitalization: they are all American and Chinese, with no European companies making the list.

This is a worrying situation for European policymakers, as the collision of these firms on the world market operate as indices for the growing tensions between the US and China. As Best summarizes,

China in particular views the rapidly-evolving field of digital technology, and especially the rise of artificial intelligence, as an opportunity to further its own development. In its Made in China 2025 strategy, China targets digital tech as a strategic area for industrial policy and aims to become a global leader in high-tech manufacturing by 2049. Under this strategy, China is channelling significant public and private investment into its industrial giants and aims to reduce its state of current tech interdependence with the US by supporting indigenous tech development. The US, meanwhile, is attempting to disentangle itself from the Chinese tech industry – for example, by implementing stricter controls on foreign investment in the US, blacklisting Chinese tech firms (including Huawei), and considering restrictions on American tech exports to China. This decoupling between the US and Chinese tech industries carries the medium- to long-term risk of splitting the global economy into two distinct ‘technospheres’, each with its own products and standards. In this respect, the risk for Europe is being caught in between these two spheres and constantly being pulled to one side or the other.

Best, however, rejects the notion that Eurozone policy should be picking individual firms to serve as “champions”, and warns that overhauling laws governing competition would not only negatively impact consumers, but ultimately disincentivize innovative behavior. Instead, “[i]ndustrial policy should… aim to encourage innovation and thereby support economic growth” by situating it in a highly competitive environment. She reinforces this position by turning to a previous study published this year by the Jacques Delor Centre that argued that industrial policy works best when it is married to market competition (this paper, titled “Beyond Industrial Policy: New Growth for Europe”, is worth checking out!). Despite this guardedness, Best’s understanding of a renewed competitive framework would not be a simple reiteration of old frameworks. Reinforcing large, champion-like firms should be the agenda, though a distinction must be made between “predatory acquisitions” and “mergers that improve efficiency and deliver benefits to consumers”. Likewise, Best suggests that people recognize that information technology platforms do indeed lend themselves to a “winner takes all” state of affairs, making the “superstar firms” something of a structural inevitability.

Best’s briefing resonates with “Europe’s Third Way in Cyberspace”, a recent report from Annegret Bendiek and Martin Schallbruch of the German Stiftung Wissenschaft und Politik (the SWP, the EU’s premier think-tank for international affairs). I find the language in this title to be both interesting and telling: classically, ‘third way’ was a term developed to describe center-left and social democratic parties that had turned away from socialist and even Keynesian types of policy perscriptions towards a ‘humanist’ or ‘social’ form of capitalism. It had its origins in the idea, advanced by the Ordoliberal intellectuals and put into practice by German Christian Democrats, of a “social market economy”, a blend of free market capitalism with a welfare state and renewed focus on the legal aspects of economic life (i.e. ensuring balanced and fair competition and the like). By the 1980s the third way had become prominent across Western Europe, and was the motor of the social democrat embrace of so-called ‘neoliberalism’—though it must be said this iteration of neoliberalism was counterposed to the sort of economic revolution being led in the US and UK by Reagan and Thatcher, respectively. In both of these countries the third way would be realized by President Clinton’s realignment of the Democratic Party and Tony Blair’s ‘New Labour’, though this would be a rather idiosyncratic form determined by the laissez-faire, anti-welfare politics that preceded them.

For the SWP authors, the new third way refers to a path between American capitalism, typified by ‘Silicon Valley libertarianism’, and Chinese state capitalism. It is at once a new future (a break with the current state of things), a defense manuever (maintaining European independence, interdependence and competitiveness), and an act of preservation (retaining the ‘essential’ aspects of the EU experiment). Bendiek and Schallbruch write that

“Regulation, competition and industrial policy must relate to cybersecurity and and cyber foreign policy. The key question will be whether or how the EU can successfully strengthen digital sovereignty whilst preserving its liberal democratic traditions in the digital space and ensure the necessary strategic interdependence with other regions of the world.

They see a “conflict of values” emerging on the near horizon. For some time now, information technology has been seen as a neutral—even neutralizing—force. It’s a hangover from the tech boom of the 90s, which perceived global information flows as a great leveller, something capable of smoothing out the rough edges of the world order and of breaking down every sort of barrier between nations, cultures, markets, so on and so forth. Tech led, so the prophecy went, and governments followed, and where both were heading was a transnational world whose governmental architecture would be less “formal Greek” and more “Frank Gehry” (to quote Hillary Clinton). But, as the SWP authors point out, this line of thought has obscured the deep connection between tech and great power politics. It’s impossible to attribute to information technology as a simply neutral position when, for example, the dominant tech firms work closely with the US government state surveillance apparatus. Likewise, the ongoing cold conflict between the US and China, with firms like Huawei taking center stage, should give these technologist determinists room for pause:

The US administration views Huawei not only as a market participant but, at the same time, as a Trojan horse from an unfriendly government…

The conflict over Huawei marks a break with the purely market-based logic of global trade relations and expedites a growing digital mercantilism. Many see converging markets as no longer simply an opportunity to improve prosperity, but also as a danger to self-determination and public safety. They argue that digital products are suitable for undermining value systems and subverting governmental control through technical backdoors. Terms such as “technological sovereignty” and “economic vulnerability” or “weaponized interdependence” are an indication and legitimation of the growing willingness to restrict innovation and competition when it comes to digital products and services.

In this environment, the striving for a preservation of European “digital sovereignty” becomes paramount. To achieve this end, Bendiek and Schallbruch lay out a means of three planks: “(1) maintaining and enhancing global competitiveness, (2) rules on competition that are as fair as possible (3) investment in digital infrastructures”.

Moving west from Brussels to the UK, itself on the verge of finalizing its exit from the EU, and we find a similar set of concerns at play. The events massive—and for many, surprising—defeat of Labour by Boris Johnson’s Conservatives needs little repeating here, though it might be worth keeping in mind that the question of Brexit was a major determining factor in how that critical vote played out. What will the UK look like outside of the EU? It’s hard to say at this point, but there are already rumbles of a large-scale restructuring of the British government. The Times (shout out to Thom once again for drawing this to my attention) reports that Johnson “has drawn up plans for to run a ‘revolutionary government’ that will see ministers sacked, Whitehall departments abolished and civil servants replaced by experts in a bid to ‘reshape’ the economy”. FT goes even more in-depth:

Mr Johnson now wants to create a powerful new business department — absorbing the international trade department — to secure inward investment for the UK’s poorer regions and strike trade deals across the world, according to officials briefed on his proposals. Rishi Sunak, Treasury chief secretary, is seen in Whitehall as a potential head of the new economic super-ministry, which might also take responsibility for broadband and artificial intelligence from the Department for Digital, Culture, Media and Sport.

Officials confirmed that Mr Johnson was looking to recreate an energy and climate change department — as first reported in the Sunday Times — because of the political imperative of tackling global warming.

Much of this comes from Johnson’s chief adviser, Dominic Cummings, whose own political outlook contains a fascinating mixture of populist sentiment and technocratic imperative (for more on the tangled relationship of these two forces, I refer the interested reader to my post “Technocracy and Populism”). In a 2017 blog post he lauded ARPA, the Department of Defense R&D hub that worked to promote a wide range of innovations, most slated primarily for military use but with significant bleed-through into civilian applications (see: the internet, but also information technology more generally). Cummings writes that the successes of ARPA “runs contrary to how free market think tanks and pundits describe technological development. The impetus for most of this development came from government funding, not markets”. For this reason, he continues, “[a]s we ponder the future of the UK-EU relationship shaped amid the farce of modern Whitehall, we should think hard about the ARPA/PARC example: how a small group of people can make a huge breakthrough with little money but the right structure, the right ways of thinking, and the right motives”.

This need for a British ‘innovation think-tank’ was reiterated in a recent speech by the Queen, and was the subject of series of documents obtained by the New Scientist. As they report, these documents

show that the proposed new agency would back researchers working in any new and emerging fields with a high risk of failure and where the outcomes are uncertain.

“Our proposal is that a new body, offering academics longer term funding (spanning at least 10 years) to tackle significant societal challenges – problems or opportunities – could help do this and strengthen the UK’s global reputation,” officials write in a discussion paper on a UK ARPA.

The agency would be a plank of the UK’s aspiration to become a “science superpower”, they add.

The Department for Business, Energy and Industrial Strategy (BEIS) invited academics to a meeting at 10 Downing Street on 25 September to discuss plans for the agency. Cummings was present at the meeting, people who attended told New Scientist.

Business minister Andrea Leadsom and science minister Chris Skidmore also attended, though the list of academics at the meeting is redacted, as are many of the documents released by BEIS under the FOI request.

The mooted agency wouldn’t have set areas of research focus, but existing UK work on quantum computing and molecular biology are cited as examples of the sort of research that could be funded. The emphasis is placed on long-term funding, up to 15 years, for basic research that is “far from the market” and has a higher risk of failure.

That’s all for this week! (oh, and I’m always looking for more stuff to add for future round-ups—and I’m particularly interested in keeping better track of the goings-on in the developing world. So feel free to drop me a line in the comments here, or you can always DM me on twitter).

Note on the Organic Composition of Capital

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The past couple of nights I’ve stayed up way too late puzzling over the best ways to calculate the organic composition of capital — and, as a necessary extension, untangling the relationship between the organic composition (OCC) and its two ‘components’, the technical composition of capital (TCC) and the value composition of capital (VCC). This post is really just my little notes to myself to keep it straight in my head, so if anybody reading has additional insights or whatever feel free to drop them in the comments. Oh, and thanks to Kevin Rogan and MDL for listening to me ramble and providing some good feedback.

In much of the work that I’ve seen done on Marxist economics (including my own meager attempts), the OCC is determined by looking at the ratio of constant capital to variable capital. Constant capital has been derived in various ways, but most look at the value of fixed assets and inventories—and likewise for variable capital, working back from rates of employee compensation. Debates flourish over whether or we assess at historical cost or current cost, and some fairly recent work has emphasized the necessity of factoring in turnover time—the unity of production time and circulation time—in producing accurate measures. There’s a small hiccup, however, with this formula for the OCC (i.e. C/V): this remains closer to what Marx was describing as the VCC than the OCC proper.

In the 25th chapter of Capital Volume 1 (‘The General Law of Capitalist Accumulation’), Marx writes that the “composition of capital is to be understood in a two-fold sense”—a value side and a ‘material’ side. In the case of the former, the composition “is determined by the proportion in which it is divided constant capital… and variable capital”. This is the VCC, with the formula C/V emerging as the means to determine these empirically. Constant capital is the value of the means of production, and variable capital is “sum total of all wages”. Straightforward enough—but this is only one half of the question. On the latter side, the material side, where we’re dealing with the production process, “all capital is divided into means of production and living labor power”. Fred Moseley has rendered living labor power here as the “quantity of productive labor”, carefully controlling for the quantities of laborers employee who function as productive, as opposed to unproductive, labor. No longer C/V, but MP/PL (with MP being the quantities of the means of production, i.e. fixed assets and inventories, and PL being productive labor).

In the ‘division’ between the TCC and VCC, we see a direct echo of Marx’s distinction between use-values and exchange-values. As Marx wrote in the first chapter of Volume 1, “[t]he usefulness of a thing makes it a use-value… It is conditioned by the physical properties of the commodity, and has no existence apart from the latter. It is therefore the physical body of the commodity itself, for instance iron, corn, a diamond…” The TCC is the physical magnitudes of use-values deployed in the production process, put in motion by the equally-physical quantities of living labor. And so it is for the VCC: as we’re dealing here not with physical but monetary quantities, constant capital and variable capital are anchored in their exchange values.

Henryk Grossman makes a similar point:

Ricardo already made the distinction between capital-intensive and labour-intensive spheres of production, which was important for his theory of profit. But he conceived of it purely in terms of value. Marx split Ricardo’s category into its use value and exchange value sides, in order to reunite them in a synthesis. The category of organic composition, transformed in this way, takes on a completely different function, not only for the explanation of profit, as in Ricardo’s work, but also as the ‘most important factor’ in the accumulation of capital

From this angle, the OCC becomes the thing that brings the TCC and the VCC together, just as use-value and exchange-value required something that each are irreducible too. In the context of the production process, the function of the OCC is the expression of the way that the TCC and VCC interact with one another, an interpenetration that works through their fundamental unity (one wonders, then, if Marx’s choice of the word organic is a nod to Hegel’s usage of the term—similar to the argument made by Tombazos that Marx’s invocation of biological metaphors for different aspects of the capitalist process fulfills just that purpose). He writes:

Between the two there is a strict correlation. To express this, I call the value composition of capital, in so far as it is determined by its technical composition and mirrors the changes of the latter, the organic composition of capital. Wherever I refer to the composition of capital, without further qualification, its organic composition is always understood.

Here, both formulations—MP/PL and C/V—are necessary to properly articulating the real nature of the OCC. This becomes clear particularly if we consider the possibility that a given industry might VCCs that appear equal, but diverge on the side of the TCC—as well as a vice-versa. Consider a scenario (and here I’m riffing off an example given by Marx in Volume 3) where Industry A and Industry B both deploy 3000 constant capital and 1500 variable capital. But suppose that Industry A is working with steel, whereas Industry B is working with copper. Because of the chasm between the value of steel and that of copper, the physical quantities of copper at 3000 C in Industry B would be higher than that of steel in Industry B. Thus while the VCC in Industry A and B would be equal, their TCC would be divergent. Similarly, we could just as easily draw up a scenario where Industry A and Industry B have equal quantities of steel, copper, and labor, thus producing an equalization on the side of the TCC, but as long as the value of steel and copper are unequal, the VCCs would diverge. This becomes particularly important when considering the movement of the rate of profit, which is determined by the OCC: we might be able to get a picture of what the ROP is doing by calculating the VCC, but we also lose sight of how that ROP is really being determined.

 

Industrial Policy Round-Up #1

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Last week, I created a twitter for the purposes of scrapping our fave zone of cyberspace for mentions of industrial policy—follow Lil’ Industrial Policy Guy!—partly for the novelty of it, but also for keeping up with the ongoing conversations around the topic. It’s certainly been more active than I initially anticipated, and one of the things I have found deeply fascinating (and deeply disconcerting) is the the continuation of a trend that I noticed when I first wrote about this topic back in July: there’s a more dynamic conversation happening right now on the right, as opposed to the left.

Perhaps the item that gained any sort of widespread circulation was a piece that ran in the American Prospect, titled “Industrial Policy and the Climate Challenge”. It’s written by Mariana Mazzucato, who, for those who don’t know, is the author of The Entrepreneurial State: Debunking Public Vs. Private Sector Myths. Her work is quite interesting, focusing on the ways in which state-financing and research and development has led to a multitude of innovations that we tend to take for granted as being the byproducts of a kinetic, technologically-oriented laissez-faire system. Mazzucato’s preferred example is the iPhone: behind the GPS technology, the touch screen, voice commands, etc, is the looming—yet largely invisible—hand of government sponsorship of technological development. The crux of the matter that Mazzucato identifies is a certain squeamishness on the part of private ventures to embark on high-cost, high-rest ventures, which leads to hold their investment capital close to the chest. In an inversion of common economic thinking, the state here emerges as the entity that comes to bear the costs and risks of the “technological mission”.

There’s a continuity between these arguments and those in her article about the possibility of a green industrial policy or Green New Deal. Because businesses have become—or maybe always were—risk-averse, it’s foolish to look to them in setting off the great waves of investment and innovation that are necessary in confronting (and hopefully averting) impending climate catastrophes. Instead, the state should take charge in generating the vital infrastructures and research programs and mobilizing the appropriate flows of capital and labor that is needed. This, in turn, means harnessing the power of the market to a strong, centralized imperative, with the two locking together into a reciprocally-determining ‘co-design’. She writes:

Policies aimed at big societal challenges require confronting the direction of growth—to become more inclusive and sustainable. But this is very hard to do within the traditional framework that sees policy as simply fixing market failures or simply de-risking and facilitating value creation. Challenge-led growth requires a new tool kit—one that is more based on market shaping and market co-creating. Industrial policies have always been composed of both a “horizontal” and a “vertical” element. Horizontal policies have historically been focused on skills, infrastructure, and education; while vertical policies have focused on sectors like transport, health or energy, or technologies. These two traditional approaches roughly embody differing schools of economics: neoclassical economics–inspired horizontal policies focusing on supply-side factors and inputs; and evolutionary economics–inspired policies putting emphasis on demand-side factors and systemic interactions.

There’s a curious echo here of Nick Srnicek and Alex Williams’ commentsin the 2013 Manifesto for Accelerationist Politics, that “[w]e need to posit a collectively controlled legitimate vertical authority in addition to distributed horizontal forms of sociality… The command of The Plan must be married to the improvised order of The Network”. And just as the MAP shimmered with a kind of steely retrofuturism, so too does Mazzucato look back. The end of her piece features a black and white photograph, dated to 1963 of President Kennedy looking up at a rocket on the launch pad at Cape Canaveral, and the final section bears the telling title of “We need a climate moon shot”.

Meanwhile, in Brussels, the conversation is already rolling. Financial Times reports that the Eurozone is in a mad rush to “retool” its industrial policy programs in the face of the bloc’s automakers failure to embrace the “electric car revolution”. Automotive manufacturing is a vital component of the European industrial base, and as it stands now is in the unenviable position of having to import batteries for the new breed of cars—batteries that, importantly, take up some 40% of manufacturing costs. In 2017 the European Battery Alliance, a coalition of policymakers and businesses, was formed to work towards remedying this situation, and within two years it helped funnel 100 billion euros in private and public funds into battery manufacturing. With an expected boom in battery manufacturing on its way—a “tenfold” growth by 2023—this number, along with a deeper and broader industrial policy infrastructure, is expected to climb.

Concerns about the climate and sustainable development are only a part of the European’s shift. It’s also deeply political:

Fearing European industry could be crushed by US technological supremacy, Washington’s growing protectionism and Chinese state capitalism, German, French and EU leaders have embraced a reinvigorated industrial policy as a tool to assert the continent’s technological independence and ensure its economic survival… “I really think of this issue in terms of sovereignty,” says Bruno Le Maire, French finance minister.

The drive to maintain a top position in the global system is also at the heart of what got by far the most circulation on twitter: Marco Rubio’s December 10th speech given to the National Defense University. It follows in the wake of the senator’s February 2019 report “Made in China 2025 and the Future of American Industry”, and his talk last month at Catholic University on “Catholic Social Doctrine and the Dignity of Work”. In the former, Rubio took aim at the ten-year China drafted by the Chinese government in 2015, which outlined a strategic bid to become the world leader in a host of key industries. These include information technology, robotics, green energy, railway equipment and agricultural technology—an ambition program that slots the ongoing US-China trade war into its real context. In the words of a Council on Foreign Relations article published last year, “[i]n the saga of the U.S.-China economic rivalry, Made in China 2025 is shaping up to be the central villain, the real existential threat to U.S. technological leadership”.

Rubio, chairman of the Committee on Small Business and Entrepreneurship and a member of the Committee on Commerce, Science, and Transportation, concurs. The February Report addresses a growing imbalance between American and Chinese industrial power and global competitiveness, and suggests that the US’s common stance in regards to the economy—neutrality—is sadly mistaken. “‘Not choosing’ is a choice, however it is made”. As such, “the US cannot escape or avoid decisions about industrial policy”. For Rubio, the choice is clear: affirm industrial policy.

The talk given to Catholic University was somewhat different, focusing instead on the question of whether or not a commitment to a strictly market-based order is compatible with notions of the common good: “does our country exist to serve the interest of the market, or does our market exist to serve the interests of our nation and of our people?” Contemporary American Catholicism has had a curious affinity with laissez-faire attitudes, emerging in part from the broad “fusionist” strategy pursued by the right since the 1950s, which sought to marry social conservatism to libertarian-leaning economic ideology. In its most recent manifestations, there has been an erroneous conflation between the Catholic social teaching of subsidiarity (matters must be handled by scale approach to their magnitude) and its economic corollary, distributism, and laissez-faire economics. Properly rendered, subsidiarity lends itself to a more corporatist position, from which the regulation of the common good is supposed to unfold—in contrast to the liberal ideal of the common good emerging from the foam of individual actors pursuing what they perceive as their individual goods. But I digress—

Rubio tries to resolve these issues by offering up an awkward synthesis that he dubs “common good capitalism” (one can’t help but wonder if this shares any genetic material with Andrew Yang’s “human-centered capitalism”). “Common good capitalism”, he argues, “is about a vibrant and growing free market, but it is also about harnessing and channeling that growth for the benefit of our country, our people, and our society at large”. A truly utopian form of capitalism!

In the recent talk at the National Defense University, the geopolitical struggle with China, common good capitalism, and industrial policy all intersect. A few choice bits:

Almost overnight, we have awakened to the reality that “while America slept,” the Chinese Communist Party has emerged as an immediate and growing threat to prosperity, our freedoms, and our security.

[…]

Experts were intoxicated with post-Cold War fantasies about “the end of history.” A bipartisan consensus formed that an American-helmed international system would forever be the new normal, and the arc of all nations was toward democracy and respect for the rule of law.

We have made great progress toward advancing our values and interests. But it is now clear that our consensus on China was dangerously flawed.

[…]

This century will be defined by the relationship between the United States and China.

And it will either be the story of an unfair and unbalanced relationship that led to the decline of a once great beacon of liberty and prosperity.

Or it will be the story of a stable, balanced, and sustainable relationship that allowed us to further and protect our national interest and the common good of our people.

[…]

For public policy makers, the common good can’t just be about corporate profits. When dignified work, particularly for men, goes away, so goes the backbone of our culture. Our communities become blighted and wither away. Families collapse, and fewer people get married. Our nation’s soul ruptures.

[…]

I am not advocating for a government takeover of our means of production.

What I am calling for us to do is remember that from World War II to the Space Race and beyond, a capitalist America has always relied on public-private collaboration to further our national security.

And from the internet to GPS, many of the innovations that have made America a technological superpower originated from national defense-oriented, public-private partnerships.

[…]

It is a call for a 21st-century pro-American industrial policy.

There is every reason to take seriously the gravity of this moment. What Rubio is posing is a break with the prevailing orthodoxy that it has cemented itself as an unwavering dogma around both the Republicans the Democrats. Usually such calls come from the fringes of a given party—but here, it is being issued from within the mainstream itself. It’s a rupture, even, with the shift in the party that has taken place under Trump: for all the bluster and nostalgia-mongering of the MAGA moment, Trump’s policies have failed in virtually every respect to break with orthodoxy. Even his primary hammer of choice, the tariff, was a feature of both Reagan and Bush Jr.’s economic toolbox, and its all-pervasive use has more to do with the contingencies of structural geopolitical-economic imbalance that it does with any sort of sea-change. And as the tariff war continues to fall short of delivering the goods, and the economy continues to stagnate (how long before people realize how truly lackluster the recent jobs report really was?), the support for these ideas in the mainstream will only grow.

Meanwhile, the liberal centrists continue to dig their heels in. Industrial policy was featured at this year’s Charles River Associates Brussels Conference, dedicated to the issue of “Anti-Trust in Times of Upheaval”. Jason Furman, a veteran of the Obama administration’s economic team (first as deputy director of the National Economic Council, then as chairman of the Council of Economic Advisors), seemed to suggest that while industrial policy may be something of inevitability, restraint and caution should condition any embrace of such programs:

A little background on Mr. Furman here: prior to entering the Obama administration, he was involved with the incredibly misnamed Hamilton Project, a program that was run out of the liberal counterpart to the American Enterprise Institute, the Brookings Institution. If “neoliberal” actually means anything at all, the Hamilton Project personifies it. It was founded in 2006, with the aid of start-up funding provided by Goldman Sachs, by Robert Rubin, himself a veteran of the firm and the former head of Bill Clinton’s Treasury Department. Rubin wasn’t the only former Clintonite who was associated with the Hamilton Project, with his protege Lawrence Summers—Clinton’s deputy Treasury secretary—taking a position there as well. Obama spoke at the Hamilton Project’s opening ceremony, and when it came time to staff his economic team, he drew heavily on the group’s ranks, tapping not only Furman but Summers, Peter Orszag, and Austan Goolsbe as well. When it came time to organizing the bailouts in the wake of the Recession, it was these people who set the agenda—and who, against dissenting voices in the administration who were sidelined, blocked more radical solutions and structural changes from going forward. So take Furman’s comments with a grain of salt.

One last item, brought to my attention by Thom:

Oren Cass was a participant at the National Conservatism Conference, where he debated libertaran Richard Reinsch on the merits of the an American industrial policy—taking, as one might guess, a pro-policy stance. To see Cass announcing his departure from the Manhattan Institute (which, historically, has been a hotbed of neoliberal orthodoxy) is interesting enough, but that he’s doing so to “start a new organization whose mission is to redefine economic orthodoxy” is extremely telling.

Until next time!

Foreshadows of a Great War

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This morning I came across this fragment by Engels this morning, penned in 1887 as the introduction to a pamphlet by Sigismund Ludwig Borkheim (a veteran of the revolutions of 1848 and member of the International Workingmen’s Association) titled “In Memory of the German Arch-Patriots of 1806-1807″. Engels in this period was flirting with the theories of capitalist breakdown that flourished in the years of depression following the Panic of 1873 (at least this is what I argued in a recent post, check it out), which often posed a ‘catastrophist’ account of the transition beyond capitalism. By some accounts this was a political catastrophe (the revolution accelerated by the pressure of capitalist crisis), and in others this was an economic catastrophe (the final collapse of capitalism taking on a precedence over that of political organization). What’s interesting is that in Engels’ piece is a version of catastrophism that isn’t immediately economic, or at least the usual sense—it’s a world war. And indeed, when we look at the tendencies, both economic and cultural, it isn’t really the mild recovery from the Long Depression in the early 1900s that closes this period; it’s World War I itself. 

Anyways, here’s Engels:

And, finally, the only war left for Prussia-Germany to wage will be a world war, a world war, moreover of an extent the violence hitherto unimagined. Eight to ten million soldiers will be at each other’s throats and in the process they will strip Europe barer than a swarm of locusts. The depredations of the Thirty Years’ War compressed into three to four years and extended over the entire continent; famine, disease, the universal lapse into barbarism, both of the armies and the people, in the wake of acute misery irretrievable dislocation of our artificial system of’ trade, industry and credit, ending in universal bankruptcy collapse of the old states and their conventional political wisdom to the point where crowns will roll into the gutters by the dozen, and no one will be around to pick them up; the absolute impossibility of foreseeing how it will all end and who will emerge as victor from the battle. Only one consequence is absolutely certain: universal exhaustion and the creation of the conditions for the ultimate victory of the working class.

That is the prospect for the moment when the development of mutual one-upmanship in armaments reaches us, climax and finally brings forth its inevitable fruits. This is the pass, my worthy princes and statesmen, to which you in your wisdom have brought our ancient Europe. And when no alternative is left to you but to strike up the last dance of war – that will be no skin off our noses. The war may push us into the background for a while, it may wrest many a conquered base from our hands. But once you have unleashed the forces you will be unable to restrain, things can take their course: by the end of the tragedy you will be ruined and the victory of the proletariat will either been achieved or else inevitable.

In 1918, Lenin looked back on these words and described them as a “scientific prophecy which has come true”.

Catastrophic Marxism in the Age of Decadence

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A few weeks back I wrote a post on the uncanny similarities between postmodernism—as a kind of all-encompassing and generalized cultural condition that has persisted since (roughly) the early 1970s—and ‘decadence’, the elusive ensemble of expressions, traits and (sub)cultural norms that rolled across Europe in the so-called fin-de-siecle era. On the surface, what brings the two together is the sense, common to each, of being at the ‘end of things’, the “last in a series”—an apocalyptic affect and constellation of aesthetic commitments that doesn’t end in spectacular combustion, but a simple unceasing of movement and motion Then, this was understood through the thermodynamic principle of entropy, and while the actually ‘end of the world’ in a cosmological setting exists at the other side of vast time-scales, this cold tableau was registered as something imminent. Today, entropy doesn’t hold as much sway, and the time-order that it produces is blocked by the negation of any sort of motive historical time.

It would be proper to label postmodernism a phase of decadence as well—so long as it is understood to be a condition that is more virulent than its predecessor, the age of ‘classical decadence’.

The similarities don’t end at distinct cultural parallels. The fact is that both expressions form themselves across the spine of an increasingly fragile and stagnant capitalism. If we take that classic Marxist frame of reference, the rate of profit, as an indicator, we find that these elements smoothly lock together:

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(source: Michael Robert’s blog)

A crisis of history is always, inevitability, a crisis of politics, and particularly so for politics that takes the construction of the future for its task. Thus this situation—and the host of cultural expressions that it brought into play—radiated throughout the fractious currents of Marxism, then still only in its nascent stages of growth. When the French ‘aristocratic’ Decadents like the Goncourt brothers could look out at the slowly reclining European continent and write that they were living through a strange repetition of the “malady of the Roman Empire”, a veritable “anemia” that was “obviously an actual fact”, their words formed an odd symmetry with legions of socialists who, with the then-recently published final volumes of Marx’s Capital in hand, searched for the rationale of development’s turgid detour. These particular Marxists—the catastrophists—heralded the impending collapse of capitalism. Where they broke their decadent cousins was that they didn’t see in this situation the eclipsing of all historical possibility. Instead, it was the ruination of civilization that prompted the opening of the future itself: communism erected atop a world turning into rubble.

From catastrophe to renewal: the evolution of Marx’s crisis theory 

Catastrophe isn’t a foreign concept to Marxist thought. It figures as a permanent motif in the writings of Benjamin and Adorno, who both presented it as the ur-condition for modernity, a transient indicator of the “shock” through which this new epoch has ruptured the “flow of time”. But the chronological nature of catastrophe offered by these Marxists was a bit different in that it spoke of catastrophe, one perceived as being new—even to capitalism—ongoing, and slowly building to a particular point, producing along the way an immense influx of pressure that served as the ground for political mobilization.

The traces of this tendency are to be found in Marx’s early writings. In the Communist Manifesto, for example, the immediacy of the proletariat revolution is sketched out against a capitalism that has a double feature. On the one hand, there is the dynamic capitalism extolled in the fevered recounting of what the bourgeois revolutions have birthed into this world, and on the other, the inevitable advance of capitalism on its bad side. A brief overview of capitalism’s tendency to cyclical crisis is briefly sketched:

Ever since the beginning of this (19th) century, the condition of industry has constantly fluctuated between periods of prosperity and periods of crisis; nearly every five to seven years, a fresh crisis has intervened, always with the greatest hardship for workers, and always accompanied by general revolutionary stirrings and the direct peril to the whole existing order of things.

Yet at the same time, the progressive side persists, and makes possible the basis for a world beyond capitalism; as Etienne Balibar said, quoting Leibniz, capitalist society is “heavy with futurity”. “It thus appears”, Marx wrote, “that the very qualities of big industry which, in our present-day society, produce misery and crises are those which, in a different form of society, will abolish this misery and these catastrophic depressions”. Here, the connection between the proletarian struggle and economic crisis is forged. The possibility of communism is latent, but its actualization emerges through the conditions brought on by the crisis.

As Alvin Gouldner has pointed out in his work The Two Marxisms, all of Marx’s earliest writings, from his doctoral dissertation (1839-1840) to the Economic and Philosophic Manuscripts (1844) and right up to the Communist Manifesto (1848) were penned under the shadow of Germany’s economic turmoil. At the same time, the Young Hegelian world in which Marx had for a while moved through was enraptured by securalized eschatology; Bruno and Edgar Bauer, for example, maintained ‘catastrophic’ theories of history, with the former writing to Marx in 1840 of an imminent and “frightful” “catastrophe…  greater and more monstrous than that which accompanied Christianity’s enterance on the world scene”. Moses Hess, meanwhile, announced in 1842 that “England, where distress has reached a frightful proportion, is heading for a catastrophe sooner than has been expected. And no one can foretell the consequences will have not only for Great Britain but also for this continent”.

From the reflections of the Young Hegelians to the material conditions of Germany; there, worker’s wages had risen in the 1820s and 1830s, but would sharply drop in the 1840s, reaching a low point in 1847. Recession swept over the land, triggering a rise in prices (for agricultural commodities, some price increases reached 100%) while some 6% of those living in the urban centers were cast in homelessness. “After 1845”, writes Thomas Nipperdey in Germany from Napoleon to Bismarck, “food riots were becoming frequent, for example in Berlin, where the ‘potato revolution’ took place on 21 April 1847, or in Upper Silesia, where 80,000 fell sick with typhus, of whom 16,000 died”.

The Communist Manifesto, standing at the end of this phase of Marx’s development (keep in mind that this a quite different analysis than that of Althusser’s allegations of an ‘epistemological break’), is the distillation of this social environment, where the fury of industrial development glided with ease into utter barbarism. It is the germ-seed of all of Marx’s subsequent thought, and the litany of Marxisms that followed—but it is with the catastrophists in particular that a distinct and idiosyncratic tracing of the work can be felt. This can only really be glimpsed, however, through its juxtaposition against the evolution of Marx’s critique of political economy and the material-economic circumstances that shaped them.

Gouldner’s work is, to my mind, one of the only I’ve seen to attempt this (and sadly his work in this area is far too brief). He notes that as Marx and Engels left Germany at the end of the 1840s and found their way to London, the floodwaters of economic turmoil receded and gave way to a period of relative prosperity and growth—and, along with it, what Marx and Engels described as a “decomposition” of the workers movement. Crisis would not rear its head again until the latter part of the 1850s, when the Panic of 1857 began in the United States and soon made its way across the Atlantic, to Great Britain. Marx at the time had been writing for the New York Tribune, and had in fact penned several articles in the months again of the crisis about an impending ‘industrial crash’—only for these comments to be dismissed by the financial presses. Two months after the Panic set in, Marx penned “The British Revulsion”, in which he sketched the movement of the 7-11 year business cycle—now commonly known as the Juglar cycle—and compared not only the prevailing economic climate, but the actions taken by the Bank of England, with the period in the run-up to 1847. For Marx, the Panic of 1847 had a nature that was much deeper that the ‘free traders’, the bankers, or the presses cared to admit:

What English writers consider an advantage of their present crisis, as compared with that of 1847—that there is no paramount channel of speculation, like the railways, for instance, absorbing their capital—is by no means a fact. The truth is the English have very largely participated in speculations abroad, both on the Continent of Europe and in America, while at home their surplus capital has been mainly invested in factories, so that, more than ever before, the present convulsion bears the character of an industrial crisis, and therefore strikes at the very roots of the national prosperity.

It was in this same time that Marx went to work on the Grundrisse. As a transitional text—Peter Thomas and and Geert Reuten call it a Kampfplatz, a battleground—there is a collision between old ideas and theories and the dynamic systematization that emerge only in the volumes of Capital. The flirtations with stadialism that could found in earlier works has already begun to give way plural temporalities that underpin late Marx, though this exists in uneasy tensions with the inheritance of a kind of mechanistic-teleological depiction of capitalism’s impending end. As Thomas and Reuten note, large swaths of the Grundrisse remained under the sway of catastrophism, though the nature of the catastrophe has shifted a bit. Reflecting a lineage running back to the French Revolution, the Marx of the Communist Manifesto had an understanding of imminent catastrophe as a political act. In the Grundrisse, the catastrophe is not so much political as it economic, and the figure of the proletariat largely recedes to the background. This doesn’t mean, of course, that Marx abandoned political commitments or the analysis of class society, but what it does mean is that the Grundrisse presents capitalism as tending towards its own self-abolition.

In these pages, Marx sketches a theory of the rate of profit and its fall that lacks the sophistification of the organic composition of capital, which would only emerge in Capital—though here already there is a clear movement towards it. The rate of profit declines when “the portion [of capital] exchanged for living labor” falls below that “existing in the form of raw material and means of production”. This disproportion is bound with two other tendencies: the “development of productive forces”, and as a consequence, a growth in relative surplus-value. Marx thus poses that a growing divergence between relative surplus-value and the rate of profit occurs, which at some point brings the system into conflict with itself. These contradictions”, he writes, “lead to explosions, cataclysms, crises, in which by momentaneous suspension of labour and annihilation of a great portion of capital the latter is violently reduced to the point where it can go on”. He continues:

These contradictions, of course, lead to explosions, crises, in which momentary suspension of all labour and annihilation of a great part of the capital violently lead it back to the point where it is enabled [to go on] fully employing its productive powers without committing suicide. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow.

By October 1958, Marx would write to Engels of a “favourable turn of world trade at this moment”, with the qualification that “the enormous accumulation of money in the banks of London, Paris and New York show that things are very far from being all right”. In Europe, the recovery had begun, while in the US, stagnant conditions would remain up through the events of the Civil War. It was in this environment that the critique of political economy came into full bloom. In 1959, Marx published A Contribution to a Critique of Political Economy, and from 1861-62 worked on a series of notebooks that expanded on themes present in the Grundrisse, albeit with a more systematic schema in mind. In spring of 1862 work was carried out for what would become Theories of Surplus Value, and wrote later that year of producing in cohesive form the output of this work under the title of Capital. From 1864 to 1865 the notebooks that would later be edited by Engels into Capital Volume 3 were written, and work on Volume 2 was carried out in the late months of 1865. In 1866, at the urging of his publisher, Marx went to work on finalizing the drafts for Volume 1, which would be publishing the following year. Volume 2 and Volume 3 would not, however, be published in his lifetime, making their debuts in 1885 and 1894, respectively.

Crisis theory holds a prominent position in Theories of Surplus Value, where Marx can be found ruminating on questions of disproportionality, but it isn’t really until Volume 3 that the question of the rate of profit and its tendential fall is addressed in full. In these pages the basic theory advanced in the Grundrisse—the widening gap between capital advanced for living labor and for non-human inputs—is reformulated through the organic composition of capital, with a high emphasis on the way in which stagnant, crisis-ridden conditions emerge, almost paradoxically, on the basis of growing productivity. But there’s another key distinct: the latent catastrophism of the Grundrisse has vanished. In the earlier work, periodic cataclysmics gave way to periods of renewed growth and stability, but were understood as leading towards the great catastrophe at the end of capitalism. In the writings of the 1860s, however, the apocalyptic language shifts as the importance of the “countervailing factors” move to the fore. In the Economic Manuscript of 1861-63, Marx writes that the “whole of the Ricardian and Malthusian school is a cry of woe over the day of judgment this would inevitably bring about”, and juxtaposes this against the “mad adventures that capital enters upon in consequence of the lowering of [the] rate of profit”. “Crises”, he adds, are thus “acknowledged as a necessary violent mean for the cure of the plethora of capital, and the restoration of a sound rate of profit”.

In the third volume of Capital, this is rendered ever-more stark fashion:

Alongside the fall in the rate of profit mass of capitals grows, and hand in hand with this there occurs a depreciation of existing capitals which checks the fall and gives an accelerating motion to the accumulation of capital-values.

Alongside the development of productivity there develops a higher composition of capital, i.e., the relative decrease of the ratio of variable to constant capital.

These different influences may at one time operate predominantly side by side in space, and at another succeed each other in time. From time to time the conflict of antagonistic agencies finds vent in crises. The crises are always but momentary and forcible solutions of the existing contradictions. They are violent eruptions which for a time restore the disturbed equilibrium.

The contradiction, to put it in a very general way, consists in that the capitalist mode of production involves a tendency towards absolute development of the productive forces, regardless of the value and surplus-value it contains, and regardless of the social conditions under which capitalist production takes place; while, on the other hand, its aim is to preserve the value of the existing capital and promote its self-expansion to the highest limit (i.e., to promote an ever more rapid growth of this value). The specific feature about it is that it uses the existing value of capital as a means of increasing this value to the utmost. The methods by which it accomplishes this include the fall of the rate of profit, depreciation of existing capital, and development of the productive forces of labour at the expense of already created productive forces.

In this same chapter (chapter 15: ‘Exposition of the Internal Contradictions of the Law’), Marx argues that through this process, the capitalist “cycle would run its course anew. Part of the capital, depreciated by its functional stagnation, would recover its old value. For the rest, the same vicious circle would be described once more under expanded conditions of production, with an expanded market and increased productive forces” [my emphasis]. Thomas and Gueten have noted that when Marx uses this term, ‘vicious circle’, he renders the phrase not in German but French—a deliberate invocation of the words as alluding to an “endless circle” or “lasting recurrence, in which one thing leads to another and back again in a spiral of presupposition and confirmation”.

Marx’s theory of crises and the tendency of the rate of profit to fall have been, at this point, utterly transfigured: the negative side of capital, the bad side, is bound more fundamentally than its progressive side than ever before, and the lingering mechanistic traces have been wiped from the theory. Catastrophe is rendered immanent to the capitalist system itself, not as a signal of a final, apocalyptic convulsion at a point in the future but as the means through which developmental processes undergoa periodic renewal—the rhythmic heartbeat of development. The dialectical dance of the tendential fall and the countervailing factors, always present but manifested most sharply in the form of the crisis, renders those processes as taking place along an asymptotic curve. Such an analysis doesn’t discount the possibility of the rate of profit’s fall being in the position of the primary (as Engels argued in his edits to Capital Volume 3—whether or not this is flush with Marx’s own understanding is a topic of open debate), but what it does do is put hard limits on the way in the ‘breakdown of capitalism’ can be understood, if at all.

A convulsion in the international order

In 1873, the ‘Long Depression’, the “first truly international crisis”, ruptured the prolonged phases of capitalist growth. It began in May, when the Vienna stock market collapsed, and spread to US in September in an economic contraction known as “Black Thursday”. North America had been witness to significant boom, set off by the reconstruction that took hold in the wake of the Civil War fueled largely by railroad construction; when investments in Pacific North Railroad collapsed, a domino of bank failures swept across the nation. A crisis in Germany’s railroad system struck as well, destabilized in the situation unfolding Vienna. The country’s economic had been upheld in large part by speculative activities, fueled by the influx of capital via the war reparations paid by France in the aftermath of the Franco-Prussian War, and these reparations came to an end right after the crisis begun to unfold. The situation was no better for France herself: the economic downturn hit a country reeling from the reparations, and left no real opportunity for the vigorous recovery that it needed.

Across the English channel, Great Britain—the global hegemon and head of the international capitalist order—plunged headlong into the crisis shortly thereafter, and it was intensified by the challenges to British trade by possible by the opening of the Suez Canal. These interlocking characteristics were what made the Panic of 1873 a crisis of international scope, and countries across the world faced declining prices and dwindling growth.

The duration of ‘the Long Depression’—or even the classification of these events as a depression—has been somewhat controversial for economic historians. From an external point of view, the whole period takes on a profoundly schizophrenic character. Internally to the crisis, for example, the usual 7-11 year Juglar cycles continued, with the expected oscillations of expansion and contraction taking place. There was also the continuation, despite stagnant conditions, of expanding industrial power, production output, and in some places, rising real incomes. For this reason, figures like the Austrian school economist Murray Rothbard have written off the Long Depression as a “myth”, a sort of hysteria formed in reaction to the onslaught of the Second Industrial Revolution and the consolidation of an international trade order.

Against these sorts of propositions, economic historians like Arthur Lewis have convincingly argued that the Long Depression was, in fact, a depression, albeit one whose character truly reveals themselves with one delves into the world of statistical data. Taking England as his testing bed, Lewis noted that profitability fell continually from 1873 to 1899, with a reciprocal collapse in trade volumes. Similarly, the British iterations of the Juglar cycles each witnessed a recession that was deeper than its predecessor, with industrial output taking longer to return to its previously ‘normal’ rate. In 1877, the nation’s construction sector collapsed, and failed to regain its strength until 1903.

Michael Roberts has shown similar data for German, France and the US. In the case of Germany, “industrial production growth was 33 percent slower between 1873 and 1890 than between 1850 and 1873”, while in France “it was 24 percent slower than before”. The US’s industrial production growth was similar to that of France, moving “25 percent slower than before”. He continues:

Evidence for a depression in the United States is most dramatically seen in railroad construction, where the financial panic of 1873 was located. In fact, the post–Civil War boom in rail construction had peaked in 1871, but the decline in production accelerated, going from 6,000 miles’ worth in 1872 to just over 4,000 miles’ worth in 1873, then plunging to barely over 2,000 miles’ worth in 1874 and dropping further to under 2,000 miles in 1875, the bottom. Railroad construction began to recover after 1875, but it did so fitfully and basically remained flat and low during the 1876–78 period, fluctuating around 3,000 miles of construction. Only in 1879 did construction surge again up to 5,000 miles, followed by the biggest surge of all as the 1880ss proved to be by far the leading decade of rail construction, followed by a nearly total collapse in the 1890s.

Roberts has further illustrated that the various theories put forth in explain this crisis—usually contingent factors ranging from impositions of gold standards to irrational exuberance in financial markets—are insufficient in grappling with its real character, which laid in the movement of the rate of profit itself. Taking the mature version of Marx’s theory as presented in Capital Volume 3, he draws out a dynamic that how, in Great Britain and the US, there was an inverse relationship between the organic composition of capital and the rate of profit. This can be glimpsed particularly well in regards to the economic tendencies swirling beneath American society:

Screenshot from 2019-11-26 15-04-12

(source: Roberts’ The Long Depression, p. 42)

One of the effects of the Long Depression was a widespread return to protectionist measures as a means to try and stabilize embattled domestic markets. In the US, tariff policies had been a mainstay of the Civil War and post-Civil War years, but an opposition, led by the Democratic Party, formed in the 1880s—only to be beaten back in the 1890s as the depression dragged on. In France, the Méline tariff of 1892 brought to a close the period of laissez-faire that had been ushered by the Cobden-Chevalier Treaty of 1860. By this point, France was already locked into a tariff war with Italy, which lasted across the decade from 1887 to 1897. In Germany tariffs had by this point a long-standing policy, with Otto von Bismarck having curtailed liberal attitudes with the tariff of 1879. Of the major countries, Great Britain was one of the few that didn’t resort to protectionist measures (though it was the subject of policy debate).

Another effect was the acceleration in the concentration of firms, a dynamic highlighted by Eric Hobsbawm in Age of Empire:

If protectionism was the worried producer’s instinctive political reaction to the Depression, it was not the most significant economic response of capitalism to its troubles. This was the combination of economic concentration and business rationalization, or in the American terminology, which now began to set global styles, ‘trusts’ and ‘scientific management’. Both were attempts to widen profit margins, compressed by competition and the fall of prices.

This tendency was also reflected by Lenin: “Free competition is the basic feature of capitalism, and of commodity production generally; monopoly is the exact opposite of free competition, but we have seen the latter being transformed into monopoly before our eyes, creating large-scale industry… cartels, syndicates and trusts”. What this transformation portended, in Lenin’s view, was “the transition from capitalism to a higher system”—an iteration of capitalist development that he labeled ‘imperialism’. Under imperialism, the “international trusts”, now the centers of economic and technical might, the “division of all territories of the globe among the biggest capitalist powers [had] been completed”. On this point, Hobsbawm agreed: “[t]here was a third possible way out of business troubles: imperialism”.

While the the intricacies of their causal relations is too tangled to really dive into on this blog’s pages, it is these three points—protectionism, cartelization, the return of colonial expansion—along with the revival of nationalism, appearing on the scene at the late phases of decadence (which, as we’ve seen, is basically synonymous with the Long Depression) as a means of ‘spiritual renewal’, helped propel the world into the dark and violent vortex of the First World War.

The coming Kladderadatsch

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Such was the world that earlier Marxism—and the latter two volumes of Capital—were thrust into, and unsurprisingly, the imprint of stagnation and crisis would be stamped on both the reception of the texts and the political lessons drawn from them. It is for this reason that I consider the catastrophist Marxists the cousin of those who at alternating probed, revolted against, and even celebrated decadence, not in the sense of an absolute determination, but as a reflexivity that constituted the experience of that crippled modern world. What is critical to consider is that when the Long Depression had erupted, world capitalism had seen nothing like it before: as an entirely new state of affairs, the feeling that civilization was entering into a foreign time and space was widespread. For Marxists, this registered as the already-realized twilight stage of capitalism itself, the coming-together of the great historical catastrophes of economics and politics.

The convulsions of the global economic system shine brightly in Engels’ efforts to edit and re-publish Marx’s works in the 1880s and 90s, though his observations were often grounded in the experience of Great Britain (after all, it was this country’s development that served as the model for Marx’s immanent critique of political economy). In the preface to the 1884 German edition of The Poverty of Philosophy, after elucidating the way that Marx “never based his communist demands upon” our “sense of morality”, describes the “inevitable collapse of the capitalist mode of production which is daily taking place before our eyes to an ever growing degree”. Engels continues:

Since England’s monopoly of the world market is being increasingly shattered by the participation of France, Germany and, above all, of America in world trade, a new form of evening-out appears to come into operation. The period of general prosperity preceding the crisis still fails to appear. If it should remain absent altogether, then chronic stagnation must necessarily become the normal condition of modern industry, with only insignificant fluctuations.

In Engels’ analysis, the 7-11 year business cycle, our Juglar cycle, no longer applied in this alien world, and as an indicator of long-range stagnation they took on an increasingly warped and widened character. Subsequent analyses of Juglar cycles within the ebbs and flows of the Long Depression show this clearly isn’t true—and it seems to me that what Engels was seeing was in fact what we might now refer to as the “long cycles” (the ‘Kondratiev wave’ or the ‘techno-economic paradigm’ of the ne-Schumpeterians) of capitalist development, which operate at a level high above these smaller cyclical convulsions.

At any rate, this same idea was turned over again by Engels in his preface to the English edition of Capital Volume 1:

The time is rapidly approaching when a thorough examination of England’s economic position will impose itself as an irresistible national necessity. The working of the industrial system of this country, impossible without a constant and rapid extension of production, and therefore of markets, is coming to a dead stop. Free trade has exhausted its resources; even Manchester doubts this its quondam economic gospel. Foreign industry, rapidly developing, stares English production in the face everywhere, not only in protected, but also in neutral markets, and even on this side of the Channel. While productive power increases in geometric rate, the extension of markets proceeds at best in an arithmetic ratio. The decennial cycle of stagnation, prosperity, overproduction and crisis, ever recurrent from 1825 to 1887, seems indeed to have run its course; but only to land us in the slough of despond of a permanent and chronic depression. The sighed-for period of prosperity will not come; as often as we seem to perceive its heralding symptoms, they again vanish into air.

It becomes even more pronounced in a lengthy footnote inserted in the thirtieth chapter of Capital Volume 3:

As I have already stated elsewhere [English edition: Vol. I. —Ed.], a change has taken place here since the last major general crisis. The acute form of the periodic process with its former ten-year cycle, appears to have given way to a more chronic, long drawn out, alternation between a relatively short and slight business improvement and a relatively long, indecisive depression-taking place in the various industrial countries at different times. But perhaps it is only a matter of a prolongation of the duration of the cycle. In the early years of world commerce, 1845-47, it can be shown that these cycles lasted about five years; from 1847 to 1867 the cycle is clearly ten years; is it possible that we are now in the preparatory stage of a new world crash of unparalleled vehemence? Many things seem to point in this direction. Since the last general crisis of 1867 many profound changes have taken place. The colossal expansion of the means of transportation and communication — ocean liners, railways, electrical telegraphy, the Suez Canal — has made a real world-market a fact. The former monopoly of England in industry has been challenged by a number of competing industrial countries; infinitely greater and varied fields have been opened in all parts of the world for the investment of surplus European capital, so that it is far more widely distributed and local over-speculation may be more easily overcome. By means of all this, most of the old breeding-grounds of crises and opportunities for their development have been eliminated or strongly reduced. At the same time, competition in the domestic market recedes before the cartels and trusts, while in the foreign market it is restricted by protective tariffs, with which all major industrial countries, England excepted, surround themselves. But these protective tariffs are nothing but preparations for the ultimate general industrial war, which shall decide who has supremacy on the world-market. Thus every factor, which works against a repetition of the old crises, carries within itself the germ of a far more powerful future crisis.

The scope of this footnote is immense: in a single paragraph, Engels roams across the world crisis, offering his theory of enlarging cycles, reflecting on the cartelization of the economy and the decline of trade and, in a moment that anticipates the coming age of new imperialism (if not the blood and fire of a world war just mere decades away), prophecizes an “ultimate general industrial war”. And to wrap it all up, the ghost of the breakdown, “far more powerful crisis” whose singularity is underscored.

Engels, in this period, was flirting with the idea of the Kladderadatsch, the crash or collapse that marks the apocalyptic end of the capitalist system. The greatest proponent of the Kladderadatsch wasn’t Marx (who, as we’ve seen, developed a crisis theory freed from the feverish anticipations of the future catastrophe), but the ‘shadow emperor’ of the German SPD, August Bebel, who Engels corresponded with extensively. Bebel’s veritable fixation on the Kladderadatsch had emerged right in the context of the Panic of 1873, the catalyzing moment of the Long Depression. As Germany turned towards tariffs in the late 1870s, Bebel seized on the opportunity to predict a complete collapse of capitalism within the next decade. Two years later he wrote to Engels of a “growing conviction” that “a partial or considerable upswing of business is out of the question, that the crisis is chronic and moves forward until some incident provides the impulse for the general Kladderadatsch“.

Bebel’s vision of the immediate future was one of “the almost complete stagnation of all businesses, starvation wages for the workers, mass bankruptcies in the class of entrepreneurs, artisans in complete despair”. This was practically a matter of faith: Bebel wrote to Engels in 1885 that “[e]very night I go to sleep with the thought that the last hour of bourgeois society strikes soon”. This was a thirst for collapse, the swapping of the common coolness in the face of recline for euphoria: the transformation of the negative catastrophe into the positive. So strong was Bebel’s fixation on the Kladderadatsch that the political dimension of the catastrophe sometimes fell away; during the SPD party congress at Erfurt in 1891, he had argued that “bourgeois society is working so vigorously towards its own destruction that we need only wait for the moment when we can pick up the power which has already dropped from its hands”. Engels wasn’t so sure. In his letters he expressed the fear that by the time the socialists were able to mobilize, it may be too late.

Other leading socialist figures—namely Kautsky and Bernstein—flirted with theories of breakdown early on, but each rejected the enthusiasm that Bebel exhibited. When the SPD’s Erfurt Program emerged from the 1891 party congress, Kautsky penned a commentary that was shot-through with the imagery of the end, rendered in the most mechanistic of forms:

We consider the breakdown (Zusammenbruch) of existing society as inevitable, since we know that economic development creates with a natural necessity conditions which force the exploited to strive against private property…

Capitalist society has failed; its dissolution is only a question of time; irresistible economic development leads with natural necessity to the bankruptcy of the capitalist mode of production. The erection of a new form of society is no long merely desirable; it has to become something inevitable.

The only question is: shall the system of private ownership in the means of production be allowed to pull society down into the abyss; or shall society shake off that burden and then, free and strong, resume the path of progress which evolutionary law prescribes to it?

Because Capital Volume 3 had yet to be published, the mature version of crisis theory and the transformation of the rate of profit was not yet known at this stages. Alternative theories on what had prompted capitalism’s catastrophic turn abounded. The Lassallean iron law of wages was grafted onto Marx’s economic analysis, though Marx himself had emphatically rejected the assumptions that underpinned this argument. Others resurrected underconsumptionist arguments: crisis emerged because the prices of goods flung onto the market far outweighed the wages of the workers who produced them. Bebel and Kautsky both flirted with this theory, as did many Italian socialists. Still, in terms of the politics and orientation of the Second International, crisis theory remained marginal, relegated to playing second fiddle to the the more general idea of breakdown.

The great assault on the Kladderadatsch came from the pen of Bernstein. In October 1898, he drafted a letter for the SPD assembly in Stuttgart that took aim at heart of this form of crisis theory:

I set myself against the notion that we have to expect shortly a collapse of the bourgeois economy, and that social democracy should be induced by the prospect of such an imminent, great, social catastrophe to adapt its tactics to that assumption. That I maintain most emphatically.

The adherents of this theory of a catastrophe base it especially on the conclusions of the Communist Manifesto. This is a mistake in every respect.

[…]

[T]he more the political organisations of modern nations are democratised the more the needs and opportunities of great political catastrophes are diminished. He who holds firmly to the catastrophic theory of evolution must, with all his power, withstand and hinder the evolution described above, which, indeed, the logical defenders of that theory formerly did. But is the conquest of political power by the proletariat simply to be by a political catastrophe? Is it to be the appropriation and utilisation of the power of the State by the proletariat exclusively against the whole non-proletarian world?

This was the opening shots of the Revisionist debates. For Bernstein, the motion of capitalist development was simply not reflecting the arguments set forth by Marx. Taking aim at the mechanistic logic of the catastrophists more than anything actually found in the volumes of Capital, he wrote that “concentration in productive industry is not being accomplished even to day in all its departments with equal thoroughness and at an equal rate”. Likewise, Bernstein perceived a shift in the relationship between the bourgeoisie and proletariat, as the “privileges of the capitalist bourgeoisie” came to submit “step by step to democratic organisations”. It followed from this that the power of the proletariat was not weakening, but was in fact strengthening: reformist social democratic politics and pragmatism, not ‘social catastrophe’, could in fact produce a steady march towards a socialist future. Robbed of the justification provided by the breakdown, Bernstein’s socialism came to take on an exceedingly ethical character—one that, in a completion of a liberal turn, would be rooted in German neo-Kantianism.

Enthralled by collapse, the ‘Orthodox Marxists’ carried out a theoretical regression that snared them in the trap of fatalism, while in his rejection of this stance, Bernstein inched closer to Marx’s own by recognizing that decline was not terminal, and that after crisis itself capitalism contained the ability to progress forward once again. But Bernstein lost the dialectical character of Marx’s analysis of capitalism, which was not simply an methodological mechanism but a probing of the very unfolding of social organization and consciousness under the sway of an operative abstraction. When he responded to Rosa Luxemburg’s critique with his famous turn of phrase—”this goal, whatever it may be, is nothing to me; the movement is everything”—he took Marx’s description of communism as the “real movement that abolishes the present state of thing” and flattened it into a one dimensional plane.

The vicissitudes of history moved in other directions. Within just a handful of years, socialism would be born out in renewed form with the events of the Bolshevik Revolution. It’s an interesting twist: deep in the throes of decadence, the Goncourt brothers had looked towards a workers revolt as a possible source for civilizational revival. In Rome’s waning days, “exhausted from a physiological perspective, an invasion of barbarians arrived to give it a transfusion of young, Herculean blood. Who will save the world from the anemia of the nineteenth century? In a few hundred years, will society experience an invasion of workers?” Jules de Goncourt also provided a significantly shortened timeline for this event: “now that civilization contains no more savages, the workers will do the job of revitalizing civilization in about fifty years. It will be called the Social Revolution”.

In Reflections on Violence, Georges Sorel echoed the sentiment of the Goncourts, albeit in a darker fashion, when he wrote that “[t]wo accidents alone, it seems, would be able to stop this movement [of decadence]: a great foreign war, which might reinvigorate lost energies… or a great extension of proletarian violence, which would make the revolutionary reality evident to the bourgeoisie and would lead to their disgust with the humanitarian platitudes”. It appears as each of these came to fruition, the latter in the form of the Bolshevik Revolution and the latter in the form of the First World War: the twin pillars standing at the end of the recline.

Now, beached on the shores of a seemingly-exhausted capitalism and stagnant, timeless life, we might do as Nietzsche did and ask: ‘who are our barbarians of today’?

Technocracy and Populism

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An interesting convergence of two sets of writings on populism and technocracy drifted across the tl yesterday: the latest issue of American Affairs, dedicated to the ongoing evaporation of laissez-faire’s hegemonic status in American thought, and a paper on the politics of Italy’s Five Star Movement (5MS) and Spain’s Podemos as being “techno-populist” in orientation. The former—as far as I’ve read—doesn’t delve into the issues surrounding these two prongs with any depth, leaving their articulation of subtext, while the latter reads these political organizations as a hybrid form born from the intermingling of each respective position.

The headlining article in American Affairs, written by Hudson Institute historian Arthur Herman, bears a title whose simplicity contains within itself a watershed moment: “America Needs an Industrial Policy”. From the opening paragraph, a litany of free-market ideologues—”from Milton Friedman and Martin Feldstein to George Gilder and Arthur Laffer”—and experiments in state-led development are quickly glossed, followed by Herman’s brief summation of the current shift:

All this explains why industrial policy has been, by and large, a taboo subject among American politicians as well as economists. That is, until now. There’s been a recent shift in mood and attitude about the proper role of government in shaping America’s economic desti­ny. There’s a growing fear that limiting government’s role to merely umpiring market mechanisms is hurting both our economic future and our national security. There is a growing belief that policy op­tions beyond market fundamentalism must exist, and that a failure to pursue these alternatives might put us on a different road to serfdom.

Another article in this American Affairs issue is dedicated to the “Socialist revival” in the United States. It’s mainly concerned with the ‘American-style socialism’ of Jacobin and the neo-New Deal ‘democratic socialism’ of Bernie Sanders, noting that these currents bear a curious resemblance to “the debates about a ‘cooperative commonwealth’ waged among Henry Demarest Lloyd, Edward Bel­lamy, Laurence Gronlund, and other nineteenth-century intellectuals prior to the founding of Eugene Debs’s Socialist Party and the rise of industrial unionism”. As with Herman’s essay, this article (written by John Judis of Talking Points Memo) notes that the ideological drift that characterizes the current emerges from a perceived crisis of capitalism. Judis writes that “[t]oday American socialism is not a fixed idea but an expression of deep dissatisfaction with what are seen as capitalism’s values and practices”, while Herman notes that “politicians, academics, and the public are realizing that these assumptions [i.e. those characteristic of ‘neoliberal’ capitalism aren’t working”.

But whereas Judis looks at the rising discontent from below, Herman focuses on the interconnections between American industrial standing and its defensive position, regarded as having entered a retrograde state that puts it at a potential disadvantage with regards to a rising China. “Today”, he writes, “the United States is engaged in a struggle with China that dwarfs the stakes of the War on Terror. In terms of its potential to shape the future, it is a struggle approaching the significance of the Cold War”. One might look at the two papers as this: Judis sees the present resurrection not so much of socialism, but the New Deal, while Herman sees what came after the New Deal—or, more properly, what the New Deal became, or perhaps always was. Here, we have not so much the opposition of populism and technocracy, as normally configured, but their intertwining, at both the level of practical application and at that of historical development.

In some respects this is quite similar to what the paper on 5MS and Podemos stakes out: the authors, Christopher Bickerton and Carlo Accetti, note that while technocracy and populism are often counterposed to one another, in the case of each of these movements, these parameters are completely scrambled. Like classic populist parties they oppose the status quo in a fundamental way, “express[ing] an ‘opposition of principle’ rather than an ‘opposition of issues'”, and take up a distinctly anti-pluralist stance. But like technocrats, they emphasize ‘pragmatic’ solutions to problems and ground their political opposition in the idea that they alone bear the ‘proper knowledge’ necessary to determine these solutions. Most importantly, 5MS and Podemos present themselves as “post-ideological”, which opens the space not only for a scrambling of the traditional left and right coordinates of political identity, but serves as the justification for this appeal to higher knowledge. Thus these parties work to resolve the charge—the one commonly made by technocrats!—that populism is intrinsically irrational and driven by emotion by making technocracy the form of articulation for populist content.

Bicker and Accetti go on to note that populism and technocracy do, in fact, bear a series of fundamental similarities:

As Cas Mudde remarked, ‘populism is not necessarily opposed to technocratic measures, particularly if they can help do away with established politicians’. ‘In the populists’ view’, he added, ‘the people should be consulted about the broad parameters of policy, while experts should produce mechanisms to bring this policy about’. Muller has gone further, stating explicitly that populism and technocracy are ‘mirror images of each other’. ‘Technocracy’, he writes, ‘holds that there is only one correct policy solution; populism claims that there only one authentic will of the people aiming at the common good’. As a result, ‘[o]ne might pave the way for the other, because it legitmises the belief that there is no real room for debate and disagreement: after all, there is only one correct policy solution, just as there is one authentic popular will’.

There are, as one might expect, limits to this kind of synthesis. It’s important to not eliminate the chasm that remains between technocracy and populism, between the cool regime of experts and the antagonism of the ‘molten masses’. Margaret Canovan has argued that in democratic societies, a tension exists between what she calls “redemptive” and “pragmatic” modes of politics; in the case of the latter, we have one of the key benchmarks for technocracy, the delicate balancing act a plurality of often-conflicting variables, and in the case of the former, the “redemptive vision” in which “the people are the only source of legitimate authority”. In this prism, the techno-populism of 5MS and Podemos are, at bottom, more populist than technocratic, but when we slip from the inward-facing world of goals and ambitions to the rowdy arena of parliamentary affairs, this populism must be recontextualized by technocratic superiority.

Perhaps to solve the puzzle, one must slip outside this frame, which ultimately treats populism, technocracy, and the mechanism(s) through which they synthesize, to the historical-materialist processes that loom beneath it.

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In Technocracy and the Politics of Expertise, Frank Fischer defines technocracy as being intrinsically bound to what he, adopting J.K. Galbraith’s term, describes as the technostructure. For Galbraith, the rise of the technostructure marked a shift from earlier forms of capitalism, where structures of ownership took precedence in terms of daily operation and business organization, to a far more complex, vast, and technologically-integrated iteration where the owner was supplanted by stratas of engineers, technicians, and experts of various stripes. The technostructure is where “all who participate in group decision-making reside”. Fischer, similarly, writes how it “consists of the policy planners, managerial specialists, social scientists, and technologists responsible for processing the information essential to the stable and efficient operation of modern large-scale organizations, in both the private and public sectors”. Bound up in this structure is a prevailing epistemological outlook on the world, rooted in neo-positivism, that sees knowledge as being the only means to reaching a solution to pressing problems: the “technocratic form of consciousness”.

The limits to Galbraith and Fischer’s lines of arguments is that each are incubated in a very specific period of capitalist development: the period spanning the New Deal through the Great Society. This was indeed a time of great transformation, seeing the arrival of a higher degree of unity between the state and capitalism than had been seen in previous eras, the realization of colossal firms and international trading systems, the introduction of computer technologies and system-oriented cybernetic ‘sciences’, and the introduction of the social scientist and revolving door between think-tanks and policy-making circles as a potent political forces. The error, however, is in seeing in these developments an abrupt break in the evolution of the capitalist system: discourses around ‘organized capitalism’ and the ‘managerial society’ threaten (particularly in this latter form) to posit an entirely new mode of production in itself, or at least the inaguration of a ‘post-ideological’ era. It was Daniel Bell who christened this age as the ‘end of ideology’, where development completed its snaking path by discovering moderate management of economic forces and the political management of contesting pluralities.

By contrast, underneath the shimmer of a rising abundance and generalized stabilize (which would quickly be recognized as being oh-so-temporary) was a capitalism that operated in accordance with the same tendencies and meta-structures as it had for centuries. Likewise—and more importantly, for what I’m trying to sketch here—the idea of a divergence between the managerial dimension of capitalism and the ownership of individual capitals is nothing new. This was regarded somewhat critically by Andrew Ure (who I’ve written about before) as far back as 1836, noting in his The Philosophy of Manufactures that

I have known not a few cases, where a complete system of good machines, capable of doing excellent work, has been capriciously turned out of a cotton factory and replaced by another of greater expense, but of less productive powers, and less suited to the style of work, than the old one if skillfully managed. These substitutions are continual in many establishments. They interfere most essentially, and often not necessarily, with the going of the mill, and are referrible almost always to injudicious choice at first—circumstances over which the proprietor, from ignorance of the structure of a good machine, cannot always venture to exercise the proper control. There are by no doubt many mill-managers perfectly fitted by judgment, knowledge, and integrity to second the sound commercial views of the mill-owner, and to advance the business with a profitable career. These practical men form the soul of our factory system.

In the third volume of Capital, Marx takes up this last point of Ure’s—that managers “form the soul of our factory system”—and pushes it much further than previously allowed, all the way to the irrelevance of the industrial capitalist in the face of the rising industrial manager:

The capitalist mode of production has brought matters to a point where the work of supervision, entirely divorced from the ownership of capital, is always readily obtainable. It has, therefore, come to be useless for the capitalist to perform it himself. An orchestra conductor need not own the instruments of his orchestra, nor is it within the scope of his duties as conductor to have anything to do with the “wages” of the other musicians. Co-operative factories furnish proof that the capitalist has become no less redundant as a functionary in production as he himself, looking down from his high perch, finds the big landowner redundant. Inasmuch as the capitalist’s work does not originate in the purely capitalistic process of production, and hence does not cease on its own when capital ceases; inasmuch as it does not confine itself solely to the function of exploiting the labour of others; inasmuch as it therefore originates from the social form of the labour-process, from combination and co-operation of many in pursuance of a common result, it is just as independent of capital as that form itself as soon as it has burst its capitalistic shell.

Marx’s comments here follow directly from reflections on capital’s domination over labor, revealing this emerging obsolescence of the industrial capitalist as an important dialectical reversal in the historical evolution of the system. The manager comes into being right when the necessity of command over labor at a large scale, and coordination between the various branches of a given production process, reveals itself. He writes:

The labour of supervision and management, arising as it does out of an antithesis, out of the supremacy of capital over labour, and being therefore common to all modes of production based on class contradictions like the capitalist mode, is directly and inseparably connected, also under the capitalist system, with productive functions which all combined social labour assigns to individuals as their special tasks.

This industrial manager is the germ of the technocrat, something that is clearly illustrated in analyses of the so-called ‘professional-managerial class’: the transference of the management of the factory, filtered through the consciousness of this particular class position, to that of society as a whole. There are no shortage of studies, for example, of how Taylorization in the factory became social Taylorization, driven by the legions of experts and specialists who arrived on the scene during the Progressive Era. But while this transference might explain the historical content of a shifting terrain of social and industrial development, it doesn’t explain the general cause that made it possible for these people to imprint their stamp upon society in such a spectacular way.

When considering the process that led to the complex division of labor, the introduction of managers, etc, one has to also look at Marx’s distinction between formal and real subsumption, and absolute and relative surplus value. Formal subsumption marked the earlier stages of capitalist development, before it had become the capitalism proper that Marx was analyzing in the bulk of the volumes of Capital. Here is where the figure of the capitalist owner appears for the first time, and one “who was formerly an independent peasant now finds himself a factor in a production procss and dependent on the capitalist directing it, and his own livelihood on a contract which he as commodity owner… had previously concluded with the capitalist as the owner of money”. Yet what is exceptional about this stage of development is that the complex process of production and division of labor had yet to have taken root: “the fact is that capital subsumes the labor process as it finds it, that is to say, it takes over an existing labor process, developed by different and more archaic modes of production”.

In real subsumption, meanwhile,

The social productive forces of labor, or the productive forces of directly social, socialized (i.e. collective) labor come into being through cooperation, division of labor within the workshop, the use of machinery, and in general the transformation of production by the conscious use of the sciences, of mechanics, chemistry, etc., for specific ends, technology, etc. and similarly, through the enormous increase of scale corresponding to such developments…

The movement from “absolute” to “relative” surplus value largely tracks along this division. In the case of absolute surplus value, the capitalist extracts surplus value—the value created that is over and beyond what is necessary for the laborer to reproduce their existence—through the indefinite prolonging of the working day. With relative surplus value, however, the capitalist has run into obstacles to this prolonging, most particularly through the rupture of the class struggle and its forceful regulation of the working day. In this movement, the capitalist comes to realize surplus value by increasing the intensity and productivity of labor with the limited labor time, primarily through the help of increased levels of mechanization within the production process. It is by no accident that in the first volume of Capital the chapter on absolute and relative surplus value follows that on large-scale machinery; as Marx writes, “the production of relative surplus value completely revolutionizes the technical process of labor and the groupings into which society is divided”.

The regulation school, led by the French economist Michel Aglietta, has taken this insight to build their theory of capitalist regulation. Marx suggests that, in general, the movement towards formal subsumption and relative surplus value changes the “technical process of labor”—but what is important here is that this remains by no means a static state. Presaging thinkers like Schumpeter, Marx is careful to draw attention to the incessant technological change that continually sweeps across capitalist society: the production of relative surplus value (we’re leaving aside points that absolute surplus value reassert themselves) is continually punctuated by paradigm-shifting innovations. It follows, then, that these innovations themselves alter the composition and organization of labor. From there, the “groupings into which society is divided” themselves undergo a rhythmic modification, shifting and turning with the transformations in the heart of the capitalist machine.

For Aglietta and others, these pulses of innovation open the door to crisis itself. While not forging straight ahead into questions of the tendency of the rate of profit to fall (it hasn’t disappeared, only moved to the background), Aglietta sees the problem in terms of the uneven development across the space of Department I (where the ‘means of production of the means of production’ are situated). Because certain sectors or even firms within a given sector will vary in terms of their organic composition and degree of development, the profitability across Department I will also vary—and this Department will exist out-of-joint with the Department II. Because, per the reproduction schemes introduced in the second volume of Capital, successful accumulation of capital proceeds through a largely harmonious development between these two departments, a conflict between them opens up the possibility of stymied accumulation.

This is an account of crisis arriving through disproportion. It might look at first like the underconsumptionist arguments that Marx was so critical of, but there is an important distinction. The underconsumptionist arguments places in the position of the primary the contradiction between the value received by the worker in the form of wages and the value of the commodities that have arrived on the market; in other words, it takes the inability to meet effective demand as the basic problem confronting capital. Marx’s theory, by contrast, moves behind these problems, and targets the source of crisis in overproduction, which appears as the intrinsic tendency of capitalist production. Through the revolutions in productivity and the exploitation of labor, society is swept along by a rising tide of output. Marx concedes that this can occassionally take the form of underconsumption at the level of appearances, by it is by no means a question of effective demand in the first instance. Instead, it is an question of what happens in the titantic collision of the contradiction between the forces and relations of production and the brute anarchy of the market.

For Aglietta, this must be read through the problem of uneveness between technical and social development, understood as a historical process. A particularly illuminating example is his account of the Great Depression, which begins with a growing imbalance between investments in Department I and the social conditions capable of meeting the profit rates required to meet those outlays, and ends with a blizzard of short-term speculation that became increasingly detached from these real, material conditions. The mode of regulation, in turn, is the periodic manifestation of the efforts—materializing the form of institutions, laws, policies, organizational paradigmsand norms—that seek to strike a balance between social development and the development of productive forces (in this case, it would be the New Deal and the sweeping programs that followed in its wake—a great lesson in how a given mode of regulation will always fall prey to the primacy of the capitalist cycle).

It’s through the shifting modes of production that I think we understand of the emergence of the technocrat proper, beginning with the formation of a managerial stratum within the sphere of production, and gradually transferring to public and civil society institutions as the demands for increasingly penetrative modes of regulation begin to hold sway. The higher integration of the sciences within production (described as the “general intellect” in the Grundrisse and the “use of science” as the “general product of social development” in Capital Volume 1) reflects upon the deepening degree to which regulation, broadly understood, takes on the classically technocratic character. Seen from this point of view, technocracy is but the superficial sheen of deeper tendencies that have held sway since the inaguration of the modern epoch.

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In The Great Transformation, Polanyi introduces the concept of the “self-protection of society”, a sort of replacement for Marxist theories of class struggle grounded not in the proletariat’s position within capitalist production, but in the communal experience of human social life. In Polanyi’s account, the laissez-faire market is a dangerous myth—utopian, even—that wrecks havok on society as it seeks to ‘disembed’ itself from social regulation. The self-protection of society is the counter-movement that strikes back at this disembedding process, and (if successful) reconstitutes some form of social control over its circumstances.

Without accepting Polanyi’s account in full, it seems to me that something similar is in play when it comes to populism—especially given that some of the historical moments that Polanyi cites as evidence correspond to great populist upswells. Like the self-protection of society, populism doesn’t necessarily form itself along class lines: by swapping class for an abstract notion of “the people”, it comes to exhibit a cross-class character, even one of class collaboration. This is particularly true when it comes the actual application of populist politics, which comes ultimately to petition the ruling class for reforms. It’s chiefly for this latter reason that Zizek famously asserted his opposition to populism as something that wholly diverges from socialist politics (I personally don’t draw such an absolute line between populism and socialism, and at any rate Zizek’s own position then might need to be thought against his current politics).

Another distinction might be that while the socialist movement seeks to draw its energy from the “poetry of the future” (as Marx wrote in the 18th Brumaire), populism often positions itself with its face looking to the past, as an expression of discontent for what has been lost. This too falls in line more with Polanyi’s analysis, which finds the self-protection of society serving equally as a politics of self-preservation. It’s this which should be taken as the benchmark of populist politics: the articulation of the singular, homogenous People erected on the basis of a swiftly dissolving ground (this isn’t to say, of course, that this articulation is always expressed through a traditionalist prism).

In the current time, populist discontent often takes as its explicit target the technocratic regime, frequently slipping back from attacking the rule-by-abstraction that is the capitalist form of domination and instead finding in technocracy itself the causes of widespread degradation. This is because the technocrats act as an active accelerant for capital’s permanent reorganization of social life, aiding at every turn to convert previously-held qualities into mere quantities and sweeping aside all old conventions and forms of life in the name of a great harmonic balance. The figure of the technocrat appears before a vanishing world as the great reducer of Spirit, the agent who extinguishes any and all characteristics of sensuous life. From the technocrat’s leveling gaze, the unruly ferment, the ‘molten mass’, can only be seen as an irrational beast to be quickly tamed and corralled back into the comfortable cage of production and consumption.

Yet insofar as it falls back from articulating itself on the basis of class, the populist is compelled to enter into the arena of politics, where the realm of the possible is always going to be curtailed by the intrinsic limitations of the bourgeois state. Whatever grievances it articulates—reforms, particular instances of preservation, etc.—will be folded in the context of the prevailing mode of regulation, the very playground of the technocrat. Thus we arrive at the ubiquity of populist/technocrat hybrid regimes. Take the New Deal: was this a populist or technocratic moment in American history? It was clearly both, with the rule of experts coming in to mediate the demands of the undermasses, to preserve the fragile grip of the bourgeoisie, and to try and realize the impossible dream of a cycle-less economy. This is also the dynamic in play with groups like 5MS and Podemos, and its shadow is cast over whatever mode of regulation is coming into view in contemporary America, where years of populist discontent on both the left and the right gives way to a profound intellectual transformation.