MIA > Archive > Fraina/Corey Archive > Decline of Am. Cap.
ECONOMIC forces – institutions and their ideology – are interlocked with the class relations of society. In any society based on private property the relations of production mean the domination of a particular class ruling over other classes. Economic contradictions and antagonisms, and economic development in general, are expressed in class interests and class struggles. The focal point of the class struggle is the state, for its force is necessary to realize class interests. Thus the class struggle is a struggle for power: to maintain or secure control of the state to decide the issues created by class-economic contradictions and antagonism. Neither economics nor politics are intelligible without reference to class relations and the balance of class power.
In “normal” times the class struggle is comparatively peaceful and the struggle for power mainly potential. The ruling class is solidly entrenched in the state, supported by all the institutional and ideological relations arising out of the existing order. It may be forced to make temporary or minor concessions; but this is compatible with the continuance and consolidation of its power for three reasons: the ruling class still represents at least the possibility of economic progress and, by and large, still “delivers the goods,” its concessions blunt the edge of opposition and strengthen its institutional and ideological supports, and the ruled classes are neither desperate enough nor conscious enough to initiate a revolutionary struggle for power. When American capitalism was on the upswing, the struggles of the agrarian, middle class, and labor radicals were easily smothered by a policy of concessions and suppression and the hope of better things. But this has its limits. While the ruling class is strengthened, it is at the same time undermined by social-economic forces which eventually produce a decline and crisis of the system. Dominant institutional and ideological relations begin to crumble. The ruling class no longer represents even the possibility of economic progress: it no longer “delivers the goods.” Hope of better things is replaced by bitter disillusion. Concessions are more difficult to make and do not satisfy, for they are limited by economic decline and the interests of the ruling class. Class struggles become more intense and explosive, more conscious of goals and means. As classes mobilize and fight, issues are clarified. The struggle for power becomes the order of the day, for it is now clear that the real struggle is between the old order and the new, and their class representatives: i.e., in contemporary society, capitalism and socialism, the capitalist class and the working class. This struggle absorbs all other issues and classes.
The emerging struggle for power is being shaped by three major developments:
This crisis of the system compels the intervention of the state the state of the ruling class. Although it claims to act in “the public interest,” for the people, society, and nation, state capitalism is really an expression of the class struggle, of the efforts of capitalist interests to maintain their rule and the system it represents. One liberal apologist of the NRA unwittingly gave the case away in justifying the resort to state capitalism:
“The old economic forces still work and they do produce a balance after a while. But they take so long to do it and they crush so many men in the process that the strain on the social system becomes intolerable. Leaving economic forces to work themselves out as they now stand will produce an economic balance, but in the course of it you may have half of the entire country begging in the streets or starving to death.” [1]
Consider the significant words: the strain on the social system becomes intolerable. It does, endangering the capitalist system: hence the intervention of the state. But why, in the past, did not “leaving economic forces to work themselves out” produce an “intolerable social strain”? Because capitalism was on the upswing, had not yet exhausted the possibility of economic progress. Now, with capitalism on the decline, it means millions “begging in the streets or starving to death.” Only an economic balance on a lower level can be produced, in spite of state intervention. For the measures of state capitalism are not intended, as other NRA apologists claim, “for the primary purpose of providing full employment with adequate purchasing power,” [2] but to bolster up the old order, aid it to function on a profitable basis, maintain capitalist domination: precisely the factors which are responsible for the crisis. Because of economic decline and the class nature of the state, any possible “economic balance” is necessarily accompanied by disemployment and lower standards of living. Behind the compromises, concessions, and pretenses of state capitalism is the ruthless determination to maintain capitalist supremacy. This aggravates the crisis of the system and arouses constantly greater opposition. The capitalist struggle to maintain power is answered by the revolutionary struggle of the working class to conquer power.
1. A.A. Berle, The Social Economics of the New Deal, New York Times, October 29, 1933.
2. John Bauer and Nathaniel Gold, Permanent Prosperity (1934), p.203.
Last updated on 4.9.2007