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From International Socialism, No.19, Winter 1964/5, p.29.
Transcribed & marked up by Einde O’Callaghan for ETOL.
Economic Survey 1919-1939
W.A. Lewis
Unwin, 15s.
The City
Paul Ferris
Penguin, 4s.
Lewis’s book shows how slow has been the growth of economic knowledge throughout the period of world industrialisation. After 1919 the growth of a consciousness of the workings of capitalism among the capitalists themselves was hindered by the irrational fervour for nationalism and revenge among Europe’s ruling classes. The US had replaced the UK as the world’s principal creditor but failed to understand the complexities and responsibilities of the of the position. Britain thought that Imperial Preference was an adequate substitute for the world market and all ruling classes considered that more work for less pay was the solution to falling prices. Everything hinged on and collapsed with the confidence of the capitalists themselves.
From 1919 to 1933 capitalists and their economic theoreticians thought still in terms of the inviolable natural laws of economic life and were not willing to create or allow a state mechanism to replace nature. The exception of course is the USSR where it was done by historic irony in the name of a largely deceased working class. While the state in Russia had assumed full control it was not well versed in capitalist practice, though in eliminating the old Bolsheviks it put an end to the confusion about socialist practice. Once full employment was reached officially in 1930 a tremendous inflation and black market ensued. To control capitalism successfully the state has to know how it works.
Lewis’s book enables one to begin to formulate a theory of state capitalism by providing data for comparing the era of significant state intervention, ie from about 1933 onwards, with the previous era of uncoordinated capitalism. The important question is not however when state capitalism began but in what aspects it differs from the capitalism of Marx’s Capital. The period up to the Great Depression and the liquidation of the kulaks may be said to conform to Marx’s theoretical model in almost all respects, including the immiseration of the working class. What has happened since then is still not clarified bv state capitalist theorists. Why, with varying national forms of exchange control, speculation control, wage control and production control, do tariffs and currency crises still hinder the development of a world capitalist system? Is state capitalism as prone to market pressures as classical capitalism, or does it control them because it is not in awe of the apparently uncontrollable, namely market competition? Ferris’s book shows – despite its journalist’s gloss – that the institutions of capital, especially the money markets, are not yet fully subordinate to the state. Socialists need both the dryness of Lewis and the gossip of Ferris if they are to understand what neither of these authors attempt, namely the institutions and the changing concepts which, originating with capitalism, now contain the burden of state capitalism. But a great deal more facts are needed. Argument on the nature of state capitalism in Russia becomes arid with the dearth of facts. It need not in the case of the UK, the US, France and Germany. The explicit theory cannot be expected in works like these but if it is to come from us such books are necessary primers.
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Last updated on 4.9.2007