RETHINKING MARXISM
VOLUME 22
NUMBER 2
(APRIL 2010)
The Economic Crisis: A Marxian Interpretation Stephen Resnick and Richard Wolff Like most capitalist crises, today’s challenges economists, journalists, and politicians to explain and to overcome it. The post-1930s struggles between neoclassical and Keynesian economics are rejoined. We show that both proved inadequate to preventing crises and served rather to enable and justify (as ‘‘solutions’’ for crises) what were merely oscillations between two forms of capitalism differentiated according to greater or lesser state economic interventions. Our Marxian economic analysis here proceeds differently. We demonstrate how concrete aspects of U.S. economic history (especially real wage, productivity, and personal indebtedness trends) culminated in this deep and enduring crisis. We offer both a class-based critique of and an alternative to neoclassical and Keynesian analyses, including an alternative solution to capitalist crises. Key Words: Capitalist Crisis, Exploitation, Keynesian Economics, Neoclassical Economics, Marxian Economics
Two different and contending mainstream theories have explained capitalism’s repeated crises over the last century. Each time each theory proposed correspondingly different solutions. Today’s crisis is no exception. One theory*/called, after one of its founders, ‘‘Keynesian economics’’*/claims that unregulated private markets inevitably yield price movements that react back on the decisions of businesses, workers, and consumers to produce out-of-control price spirals. These periodically push the economy into inflations, recessions, or even depressions. Without intervention from outside, capitalism’s private economy may remain depressed or inflated long enough to threaten capitalism itself. Keynesian*/or now more generally ‘‘macro’’*/economics identifies the key private economy mechanisms that produce cyclical crises. These range from market imperfections arising from agents’ unequal and/or unfair access to information to a plethora of noneconomic causes typically grouped together as ‘‘animal spirits.’’1 Political fear combines with macroeconomics to organize and enact state interventions aimed at counteracting the unwanted 1. Perhaps Joseph Stiglitz is the most important and best-known macroeconomist arguing that unfettered markets yield cyclical crises. The animal spirits argument first appeared in Keynes (1964, 161); it refers to how the expected yield of business investment in relation to its cost is ‘‘determined by the uncontrollable and disobedient psychology of the business world’’ (317). ISSN 0893-5696 print/1475-8059 online/10/020170-17 – 2010 Association for Economic and Social Analysis DOI: 10.1080/08935691003625182