The Political Economy of Capitalism is one half of a machine. It teaches the Marxist economics of a single mode of production — the capitalist one — across eight chapters that run from the subject-matter and method of the discipline through commodity production, surplus value, accumulation and the industrial reserve army, the distribution of surplus value among the propertied classes, the reproduction of social capital and crises, monopoly and finance capital, and finally state-monopoly capitalism. It stops exactly there, at the frontier of the system it has anatomised, and hands the reader over. The other half of the machine is the political economy of socialism, and in this series it is supplied by a companion volume from the same Soviet stable, A. M. Rumyantsev's Political Economy, whose second part takes up precisely where Ryndina and Chernikov lay down their tools. The two books were built to one specification and share one doctrine. Read together — and they should be read together — they make an instructive pair, because the first of them is very largely right and the second is not, and the reason the second fails is already legible in the first.
A word first about when this book was written, because the imprint misleads and the misleading is worth a moment. The English volume carries "© Progress Publishers 1974", and its editors, M. Ryndina and G. Chernikov, present it as a standard teaching text of the kind Soviet academic economics produced by the collective rather than the individual. But the book in your hands is not the 1974 text reprinted. Its evidence reaches into the middle 1980s. It describes the world slump of "1980-1982" as a completed event, gives US output falling "9.1 per cent" in it, records that "Unemployment reached 31 million in 1984" across the developed capitalist world, cites the "25th and 26th CPSU Congresses" — the twenty-sixth met in 1981 — and draws its inflation figures from S. M. Menshikov's Inflation and the Crisis of Economic Regulation, a Moscow book of 1979. Whatever its 1974 ancestry, the text has been revised to sit in the early-to-middle 1980s, the late-Brezhnev and Andropov-Chernenko years that Soviet economists would themselves shortly call the era of stagnation. That dating is not pedantry. It fixes the book at the precise moment when the socialist economy whose superiority it everywhere assumes was seizing up — growth sliding, investment returns falling, the chronic shortages of the command system settling into permanence — and it fixes the book's confident prediction of capitalism's imminent, law-governed downfall at the hour of that other, unmentioned exhaustion. Everything that is wrong with the book turns on that gap.
The core of The Political Economy of Capitalism — the long central stretch from commodity production through to the reproduction schemes — is an exposition of Marx's Capital, and it is a competent one. It proceeds in Marx's order and by Marx's logic. It takes the commodity as "the simplest economic cell from which Marx starts his analysis of capitalism"; it develops the twofold character of labour, the value form and the genesis of money; it derives surplus value and states the matter without flinching: "The law of surplus-value expresses the essence of capitalist exploitation, the basic production relation of capitalism" — that between capitalists and wage-workers — and, further, "The law of surplus-value is the law of evolution of the capitalist mode of production, leading, in the final count, to the socialist revolution." It handles wages, the general law of accumulation and the reserve army, the average rate of profit, ground rent, the circuit of capital, the reproduction of social capital and the theory of crises; and in its last third it expounds Lenin's Imperialism — concentration, finance capital, the export of capital, the division of the world, and the growing-over of monopoly into state-monopoly capitalism. Above all it teaches commodity fetishism as a category and not a slogan: value is a social relation that appears as a property of things, so that "Commodities rule, as it were, over people." It teaches that the law of value operates behind the producers' backs, spontaneously, as the coercive regulator of an economy nobody consciously directs, and that this law "continues in the stage of monopoly capitalism" rather than being abolished by it.
The exposition is at its most assured where Marx and Lenin are most concrete. On accumulation the book gives the general law and the industrial reserve army straight — the reserve of unemployed as a lever of accumulation and a discipline on wages, a category it deploys some eight times and pins to figures its own late date could supply. On the imperialist stage it follows Lenin's Imperialism closely: the concentration of production and its growing-over into monopoly, finance capital and the financial oligarchy that "throws a close network of dependence relationships over all the economic and political institutions of present-day bourgeois society", the export of capital, the division of the world and the colonial system and its collapse. On distribution it handles the average rate of profit, the transformation of values into prices of production and the theory of ground rent — the split of surplus value among the propertied classes — with the patience the subject needs. None of this is potted or sloganised; it is the argument of Capital and of Imperialism set out to be learned.
This is real Marxist political economy, competently taught to a great many readers in the language of international circulation, and it should be said without hedging, because the tradition from which this introduction is written — the anti-Stalinist, revolutionary-Marxist tradition — shares the analysis entire. On the anatomy of capital there is no quarrel between this textbook and its critics. A reader who worked through these chapters would emerge genuinely equipped to take apart a capitalist economy. The disagreement does not begin with Capital. It begins with what the book does, and refuses to do, with the categories it has just so carefully built.
Here is the striking fact about this volume, and it is a fact about silence. The book is 68,000 words on the laws of commodity production, value, money, wage-labour, price and profit. It insists, correctly, that these are objective laws — "They are objective since objective are production relations" — laws that under capitalism "operate spontaneously" and confront their participants as an alien necessity, precisely because no one consciously governs the economy in which they hold. And it never once turns this instrument on the society that commissioned it. The words "Soviet Union" do not appear in the book at all. "USSR" appears once. The categories that the book calls the very machinery of exploitation — the commodity, money, value, wages, price, profit, credit — demonstrably operated inside the Soviet economy of the 1980s, as anyone who shopped in it knew; and the book that expounds them at this length cannot see them there, because its brief forbids it. The analytical tool built with such care in the first seven chapters is permitted to point in exactly one direction.
The book even states, in its methodological opening, the criterion that would convict it, and then declines to apply it. Under capitalism, it explains, economic laws "operate spontaneously"; whereas "in socialist society economic laws are realised in conscious, organised activity of all society's members." That is Marx's own distinction, and a fair one: the difference between a society ruled by its product and a society that has mastered its own labour is exactly the difference between spontaneity and conscious control. But it is a test, not a certificate. Whether the Soviet economy of 1984 — with its assortment failures, its input hoarding, its plans routinely overrun, its shortages queued for in the street — was in fact an economy "realised in conscious, organised activity of all society's members," or an economy still ruled behind the backs of its producers by a bureaucracy that priced, allocated and commanded in their name, is a question the book raises by its own logic and cannot ask. The vocabulary of value the book teaches is the vocabulary that answers it. Where commodities still "rule, as it were, over people" — where money, price and wage still do their old work — the producers have not yet consciously mastered their economy, and one is looking not at socialism achieved but at a transitional society managing its unresolved commodity relations through a state. The book knows this about capitalism. It is not allowed to notice it about home.
The companion volume closes the trap. Rumyantsev's Political Economy, expounding the political economy of socialism that Ryndina and Chernikov leave offstage, states in so many words that commodity production and the law of value persist under socialism — that the law of value goes on operating there too, now put to work for the planned, balanced management of the economy rather than left to regulate it spontaneously. So the same publisher, in the same doctrine, in the volume that continues this one, concedes that the categories The Political Economy of Capitalism has just identified as the essence of a system of exploitation go on operating in the USSR. Ryndina's book supplies the anatomy; Rumyantsev's supplies the confession; and neither is permitted to hold the two pages against each other. Our introduction to the Rumyantsev volume takes up what follows from the confession — that a political economy of socialism is, in Marx's own terms, a contradiction, the science of an economy not yet mastered by its producers. Here the point is narrower and, in its way, sharper: this book teaches you everything you need in order to draw that conclusion, and stops one chapter short of the place where you would have to.
The turn that The Political Economy of Capitalism will not make was made, against precisely this bureaucratic habit, half a century before its editors set the doctrine down. In The Revolution Betrayed (1936), in the chapter on the productivity of labour and the fate of money, Trotsky treated the survival of money and value under Soviet conditions not as a settled feature to be catalogued but as the measure of a distance not yet travelled. "State compulsion like money compulsion," he wrote, "is an inheritance from the class society, which is incapable of defining the relations of man by man except in the form of fetishes, churchly or secular." The persistence of the money form was therefore an index of how far Soviet society still stood from its declared goal, not a proof that it had arrived: only when "the steady growth of social wealth" had freed men from their "miserly attitude toward every excess minute of labor" would money, "having lost its ability to bring happiness or trample men in the dust ... turn into mere bookkeeping receipts for the convenience of statisticians and for planning purposes." That is the argument Ryndina and Chernikov build the equipment for and never run. What Trotsky read as a symptom of an unfinished transition, the doctrine this book serves enthrones — in its companion volume — as a permanent law of a completed order. The whole difference between a critical and an apologetic Marxism lives in that single move, and The Political Economy of Capitalism is the apparatus of the critique lent, intact, to the apology.
The book's other characteristic move is teleological, and it is where the exposition of Marx passes over into something Marx did not write. Capitalism, we are told, is in "the period of the general crisis of capitalism" — a distinct and irreversible historical phase, opened by 1917, marked by "greater instability and decay of the capitalist economy," in which the system's downfall is not a possibility argued for but a law reported on. State-monopoly capitalism, the book's final subject, is "monopoly capitalism combining the power of capitalist monopolies and state power in the name of saving the capitalist system" — and it saves nothing: "Far from eliminating capitalist contradictions, state-monopoly capitalism further aggravates them, thereby accelerating the formation of the prerequisites for transition to socialism." Lenin is quoted for the verdict that state-monopoly capitalism is "a complete material preparation for socialism." Practice, the book says in its opening chapter, has confirmed "the historical soundness of Marxist-Leninist economic teaching on laws of capitalism and inevitability of its destruction in a revolutionary way"; the whole is designed to leave the student with "a firm conviction in the triumph of communism" and the certainty that "the capitalist system is doomed."
Two things must be said about this. The first is that the "general crisis of capitalism," presented here as the natural continuation of Marx and Lenin, is neither. As a periodising doctrine with its own stages and laws it is a construction of the Stalin era, elaborated in the 1930s and after and handed down as catechism; Marx's crisis theory, which the book expounds accurately in an earlier chapter, is a theory of a recurrent cycle, not of a one-way slide to a dated collapse. The move from the one to the other converts an analysis of capitalism's contradictions into a prophecy of its imminent, law-governed death — and a prophecy is a hostage to events in a way an analysis is not. The second thing is that events obliged. This book, revised to about 1984, teaches at length that the capitalist system is in its terminal general crisis and that its state-monopoly form is the antechamber of socialism — and within seven years of that revision it was the socialist system, the one the book will not name and cannot examine, that abolished the plan for the market and then ceased to exist, while the capitalism it had pronounced doomed did not oblige. This is not hindsight scoring a cheap point. A political economy claims to have found the objective laws of its object and to have read the future off them. When the future arrives and inverts the prediction — when the moribund system survives and the "complete material preparation for socialism" turns out to have prepared nothing — the claim is answerable, and the honest verdict is that these were not laws but a liturgy.
The book's blindness to its own side is visible in a single reserved word. Stagnation is a thing that happens only to capitalism: the monopoly economy's decay, the "stagflation" of the West, the depressed reproduction of the imperialist slump. It is never once turned on the Soviet economy, which in 1984 was the more stagnant of the two. So too with crisis, reserved throughout for the capitalist cycle, and with the whole vocabulary of shortage, applied to the capitalist money market and the developing world but never to the Soviet consumer. The reflexive question that this series puts to every volume in the library — can the category be turned on the speaker's own side? — comes back, here, flatly negative. Crisis, stagnation, anarchy of production and the tyranny of the value form are things that happen to the other system.
There is one further silence, and it concerns the discipline's own past. The Political Economy of Capitalism can expound the law of value across forty passages without ever mentioning that the law of value under Soviet conditions was the central, founding problem of Soviet economics in the 1920s, fought out by economists of the first rank. Evgeny Preobrazhensky, whose The New Economics (1926) made exactly that problem its subject and gave the debate its most powerful category — "primitive socialist accumulation" — is absent: the name does not occur, nor does the concept. Nikolai Bukharin, his great antagonist, is absent. Nikolai Kondratiev and Alexander Chayanov, whose work on cycles and on peasant economy was of international standing, are absent. Trotsky is absent; Stalin, whose 1952 Economic Problems of Socialism in the USSR fixed the very doctrine of the persistence of value that the companion volume reproduces, is absent. This is a book on the political economy of capitalism, and so it has, formally, no occasion to rehearse the Soviet debates — but that is exactly the convenience of confining it to capitalism. The men who conducted those debates were, most of them, shot: Preobrazhensky in 1937, Bukharin in 1938, Kondratiev in 1938, Chayanov in 1937. The serene discipline this book teaches was built over the discipline they made, and its serenity depends on the reader not knowing they are there. The companion volume performs the same erasure at greater length, with Trotsky admitted once as the supposed author of a nameless "principle" and Stalin's formulae reproduced without his name; here the erasure is simply total, and the more restful for it.
The Political Economy of Capitalism should be reprinted, and read, for what it honestly is: a competent, complete and usable Marxist economics of the capitalist mode of production, the export teaching text of a great state, and — in everything it says about Capital — shared ground with the tradition that answers it. The reader who wants the other half of the argument has it close to hand, and much of it stands in the tradition the book's doctrine claims and cannot name. Trotsky's The Revolution Betrayed remains the standard against which every Soviet account of Soviet society should be read; its chapters on money, value and the state supply exactly the reflexive analysis this book builds the tools for and forbids itself to attempt. Within this series, the companion Rumyantsev volume is the necessary second reading, because it says out loud what this one leaves implicit — that the law of value goes on operating in the USSR — and thereby completes the case against itself. And the deepest of the disagreements this whole subject contains, whether a planned economy can dispense with the market and the value form at all, was argued out in these very years between Ernest Mandel and Alec Nove, from the two sides of the socialist-calculation question; that debate begins where this book ends, from the premise the book cannot grant — that the socialist economy is a real object of critical economic analysis, capable of disproportion, waste and failure, and not merely the triumphant subject of a curriculum. The whole of The Political Economy of Capitalism is a demonstration of how good a Marxist economics can be for as long as it is required to face in only one direction, and of what it costs the moment it is asked to turn round.