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:
(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:
(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
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’?