Theoretical projects in the nineteenth,

twentieth, and twenty-first centuries

The intention of the present article is to examine various theoretical socialist projects and show, with the help of the Marxian analysis of capitalism, that they could be categorized as variants of capitalism rather than socialism. Although some of these theories were realized in practice, like the economy of the Soviet Union, my goal is to make a theoretical argument instead of an historical one. With regards to the Bolsheviks, my argument will not include the examination of the Soviet economy, but a theoretical examination of their understanding of socialism, and this will be done with theories by other authors discussed here as well as theories which were never implemented in any historical society.

Not all of the authors examined here considered themselves Marxists, of course, though most of them do or did. For instance, Alec Nove explicitly rejected the label. Those who did not cannot be justly accused of not following the Marxist idea of socialism. But the goal of this article is not to compare the Marxist outline of a socialist society with the socialist projects examined here, or even to use them as a tool for a better understanding of what socialist economy would look like. Since I consider the Marxist analysis of capitalism more thorough and nuanced than the neoclassical or Keynesian one, I will try to use it to show these theorists’ shortcomings in their understanding of capitalism by showing that their concepts of socialism are really no different than capitalism. Rather, they can be fit into a broad range of capitalist varieties, which testify to capitalism’s enduring flexibility. The main focus of this article is, therefore, a better understanding of capitalism, not of socialism.

In order to achieve this, I have tried to incorporate several socialist claims: state socialism by Lenin, Trotsky, Bukharin, and Preobrazhensky, “feasible” socialism by Nove, self-directed workers’ enterprises by Richard Wolff and democratic economic management by Yanis Varoufakis. Although there are many others to choose from, I have selected these because of their diversity and their influence.

Nove, while rejecting socialism as Marx envisioned it, still adheres to the general belief that socialism is a desirable alternative to capitalism. His version of socialism is just a variant of capitalism, as we will see, which came about as a result of the influence of the Marxist tradition as a whole. Unfortunately, this version seldom got further than cherry-picking elements from Marx’s theoretical framework, instead of bringing clarity to his concept of capitalism and socialism. The main problem with this method is not that it examines Marx’s theory and proceeds to subtract portions of it that do not fit the picture of capitalism’s particular historical stage, or add reflections which do fit, while retaining its theoretical clarity and consistency. On the contrary, the issue at stake is that this cherry-picking is the result of both micro- and macro-misunderstandings of Marx’s theoretical advances. By that I mean that certain portions of his theory are misunderstood and wrongly interpreted, and thus replaced with portions from other theoretical traditions or trends that correspond to it. One famous example of a micro-misunderstanding is the so-called “transformation problem,” which would be a problem for Marx only if he had viewed capitalism as an equilibrium, as some of his (“Marxist”) critics assert, a view Marx did not hold. A macro-misunderstanding simply means that the lack of understanding of Marx’s critique of capitalism as a system with its own interconnections which, if broken apart, cannot yield sense. This point of view, which is still far too prevalent in Marxism, is also responsible for accusing Marx of various inconsistencies and mistakes. Once we recognize that his critique is of capitalism as a system, and not a list of ingredients for a recipe we can experiment on and modify as we see fit, then we realize that what has been said at the end of the story makes more sense applied retroactively to its beginning, and vice versa.

The socialist projects I analyze here reflect all this, and the problems they contain can be roughly categorized into two groups: 1) skipping the mode of production as a starting point of their analysis and jumping to the questions of exchange, distribution, or relations of ownership, and 2) mistaking the symptoms of crisis for its causes. Of course, they each differ in the ways they perpetuate these problems, but all of them demonstrate this, either directly or indirectly. That is to say, they show this to be the case from both what has and has not been said.

In his speech at Marx’s funeral, Engels reminded everyone in attendance of a “simple fact.” Namely, that Marx had brought to light the fact that “mankind must first of all eat, drink, have shelter and clothing, before pursuing politics, science, art, religion, etc.”: i.e., that, in Marxist terms, the material base forms the ideological superstructure, not the other way around. The same goes for the base itself — the way the allocation of resources is set up in a given historical period cannot be understood without taking into account the mode of production (“mode of production” is used in a narrow sense here, in terms of the way people produce to reproduce themselves, not in the sense marking the whole of society, which Marx employs). This “simple fact” has obviously been too simple for many to take into account or give serious consideration. We simply cannot understand the way in which the whole of the “economy” operates (“economy” appears in quotation marks here, because I follow Marx’s understanding of society as a mode of production in the broadest sense, meaning it cannot be neatly chopped into “economy,” “culture,” etc. as if they have nothing to do which each other) unless we understand its starting point, the base upon which everything else is built and conditioned. And that is always a mode in which people produce for the sake of their own physiological reproduction. That “simple fact” Engels that talked about, which in this context I will take to mean the explanation of the base from bottom up rather than the explanation of the superstructure by analyzing its base, had not been considered before Marx. Sadly, in the context of our examination, it has not been sufficiently considered afterward either. One can even talk about the mode of production without making this connection; it does not have to be so blatantly absent from an analysis. Richard Wolff, for example, talks about the mode of production and the crucial importance of it all throughout his book Democracy at Work, but his concept of socialism suggests to me that his view of capitalism did not come about as the result of recognizing the mode in which people produce as a seed that which gives life everything else in the “economy.”

The second cluster of problems (i.e., mistaking the symptoms of crisis for its cause) is linked to the first. Theories of underconsumption, for example, although far older than Marxism (dating back to the nineteenth century economist Jean Charles Léonard de Sismondi), are widely accepted among Marxists. But these do not go beyond the level of mere appearances, concluding that the cause of crises are imbalances in the relation of supply and demand, similar to the Keynes’ emphasis on “effective demand.” Theories of underconsumption go hand in hand with the identification of the anarchy of production, inequality, and overproduction as the cause of crises, all of which fail to grasp that the mode of production is the root cause. Underconsumptionist theories are quite popular, accepted among intellectuals both within Marxism and without as well as among activists and activist groups, such as the #Occupy movement.

Theories that include these errors cannot deliver even the basic outline of socialism, because all of them fail to properly analyze capitalism. Of course, one can have one’s own view of socialism, but if we agree that Marx’s analysis of capitalism is superior to the competing theories, and assume socialism to be fundamentally distinct from capitalism, then it simply will not do to call some variant of capitalism socialism. As with the story of base and superstructure and the base from top up, we cannot understand what socialism is supposed to be if we do not understand capitalism. Capital, Marx’s magnum opus, is written to fulfill exactly this purpose. He tried to explain what capitalism is, in order that we could first recognize and then establish a society that is its opposite. Therefore I will not engage in a comparison of the socialist projects analyzed here with Marx’s view of socialism, but rather test them to see if they fit the mold of capitalism, in order to show that the authors’ understanding of capitalism is insufficient for outlining a society which is supposed to be capitalism’s opposite.

State socialism

What I am about to examine are works that advanced a theory of state socialism, by Lenin, Trotsky, Bukharin, and Preobrazhensky. All these are confined to a certain period, either during the October Revolution or in its immediate aftermath, which played a huge role in subsequent theoretical understandings of socialism as well as of capitalism, not to mention their role in the formation of societies that more or less followed the Russian example. Therefore I will not include, for instance, Trotsky’s later critiques of Stalin’s Soviet Union, though they undoubtedly offer a good source for his understanding of socialism.

Ever since the Second International, there has been a widespread tendency in socialist circles to see private ownership as being in the hands of individual capitalists, imagining it as the sole form of ownership that exists under capitalism. Social ownership was thus characterized as state ownership and thought to be the “cure” for capitalism. Its emergence was therefore thought to signal the end of the capitalist mode of production. Yet this is merely Marx’s materialist method turned on its head. Rather than mode of production determining the character of property relations, here instead changes in property relations determine the mode of production. Moreover, the belief here seems to be that ownership relations have the capacity to transform the mode of production on their own, without it ever actually being transformed in itself.

Lenin hardly wrote anything about the nature of socialism before 1917, when State and Revolution was first published. Since this text contains the majority of his views on socialism, the main focus here will be on this seminal text.

For Marx, capitalism is a society riven with internal contradictions, which therefore cannot be saved from itself. The only solution for workers is to overthrow it by establishing a dictatorship of the proletariat, which does not bring about a new mode of production, but instead serves as a political dictatorship in order to further the revolution and prevent a possible counterrevolution. When that period is over, which Marx calls the transitional period, communism or socialism begins first with its lower and then continues with its higher phase. The first phase still resembles capitalism in the sense that it is not yet a society which reproduces according to the society’s needs, but according to labor. This is what Marx meant by “bourgeois right” still existing in this lower phase of communist society. However, work will not yield surplus value for capitalists since there is no private property, no classes, and no state (the proletarian state, i.e., the dictatorship of the proletariat, ceases to exist at that point, and the bourgeois state has been abolished with the beginning of the proletarian state).

Unlike Marx, in this respect, Lenin treats socialism and communism as two different societies. Lenin distinguishes between communism and socialism, holding that they represent two separate transitional periods: One from capitalism to socialism and the other from socialism to communism. Lenin’s socialism corresponds to Marx’s transitional phase, with a couple differences. Lenin defines socialism as a transitional society, not as a transitional phase or period, that will echo over subsequent decades as something justified by Marx and serve as an excuse for various social democratic parties to stay in power and still ceaselessly promise the coming of communism.

On top of proclaiming that socialism is a different society than communism, Lenin refers to Marx’s line about the “bourgeois right” in the Gothakritik, putting words into Marx’s mouth. Even though Marx speaks of “bourgeois right” as a “principle” put into practice without a state, Lenin says “bourgeois right” cannot be enforced without a state. Furthermore, workers under Lenin’s socialism become the “hired employees of the state,” introducing, therefore, the notion of state and wage labor into society which should have rid itself of both. He emphasizes this even further, defining “social ownership” as the ownership of the state, and he defines private ownership as an ownership of “separate persons.” In socialism according to Lenin, there would be no commodity production, but products made in factories would still take the value-form. In his socialism, there would exist statewide distribution and the exchange of state products.

It really does not make much sense to establish the dictatorship of the proletariat only to bring back the state and wage labor, whose abolition was the goal of that dictatorship to begin with. This would make sense only if we suppose that state ownership is something fundamentally different than ownership by “separate persons,” which entails a formation of an entirely new society, i.e., a completely different mode of production than the one which would presuppose the ownership by “separate persons.” Here we see an inversion of the materialist method: property relations determine the mode of production instead of the other way around. Furthermore, property relations are just that: relations. Ownership of the means of production, i.e., capital, is a social relation whose existence will not perish if it is transferred to different persons, whether separate or not. Capital is not something possessed by someone, to put in macro-terms, and Lenin did not speak about a society as a whole in micro-terms. It is a relation that determines the nature of other components of society and shapes it as a whole. We could perhaps speak of capital as a thing if we were to consider, for example, earlier capitalism, when it was still just emerging from a feudal society, but that does not ring true for capitalism — for which capital is social — meaning that it is the defining characteristic of the entire society. If that is the case, then it really does not matter who owns it, “separate persons” or state, so long as it appears to be social in a given historical context. Marx puts it succinctly, saying that social capital can be either the “sum of individual capitalists or the state capital,” providing that the latter employs workers. Engels reminds us that “state ownership does not do away with the capitalist nature of productive forces.” Therefore, the juridical change in ownership does not change the fact that it is still a form of ownership. Nor does it change the mode of production it is ultimately based upon. The point is to eliminate capital as a social relation — i.e., to create conditions where it will be impossible for someone to possess capital while someone else cannot.

Products of labor that take the form of value are none other than commodities, which is to be expected in capitalism, since value is necessary for commodities to appear as social. So the distinction between products which take the form of value on one hand, and commodities on the other, suggested by Lenin, is entirely made up, at least in Marxist terms. Value means human labor which produces commodities. But these commodities cannot “confront” one another without first being fetishized, i.e., without acting as living things that rule over people instead of the other way around, since that is the only way they can appear socially (for most commodities, that is). Labor time becomes crucial here, its efficiency depending on the increase or decrease of value. Although value existed before capitalism, in capitalism it becomes the norm, as the law of value. Wage labor, which Lenin introduces into socialism is completely compatible with all of this, since the whole purpose of wage is to reproduce workers who are unable to directly exchange their goods with other free individuals and reproduce in that manner without the mediation of their products, the majority of which are alien to them. The alienation of workers from one other by means of separation into different labor units, the presence of wage labor, commodities which take the value-form, and the continued existence of property relations all characterize the capitalist mode of production. Lenin clearly distinguishes these features from capitalism, because a society with these features is something he places in the period after the transition from capitalism. But since it retains of all the principal features of capitalism, it can hardly be characterized as distinct from it. State ownership of the means of production which pays wages to workers to produce commodities is state capitalism, and hence only a variant of capitalism.

Trotsky’s ideas about socialism before 1926 (the year he was expelled from the Soviet Union) mostly dealt with to the question of the development of the so-called socialist economy in Russia, and can be found in his polemic Terrorism and Communism, his Report to the Fourth Congress of the Comintern, and finally his New Course. Although he does refer to the real economy, Trotsky’s ideas reflect his thinking about socialism as such, meaning socialism as a theoretical concept rather than an historical example.

Trotsky’s views on socialist economy were for the most part similar to Lenin’s: the way to transform the economy from capitalism to socialism is to change the juridical status of property relations. His perspective on the state logically corresponds to this understanding of property relations, clearly visible in his New Course, for example. In this work he complains of the Soviet state apparatus going in a “bourgeois direction” and the need for the communist party to struggle against “counter-revolutionary tendencies” (meaning the rise of private capital, which he conceives of the same way as Lenin, that is, as the only capital that exists in capitalism and that is opposite to the state ownership). So for Trotsky the means by which to establish socialism is to struggle against private capital. Anarchy of distribution, characteristic of the capitalist mode of production (described by Trotsky as an “anarchic distribution of labor power” through buying and selling), is countered by a planned economy. This, along with state ownership, entails the abolition of capitalism. The concrete means by which to achieve socialism is through the regulation of capital, introducing “socialist primitive accumulation” during the period when capitalism and the exploitation of labor are supposed to be eliminated, along with the market, already done away with by state planning. Wage labor continues to exist under socialism, according to Trotsky, but does not entail exploitation.

Once again, everything is almost the same as with Lenin: private property in the hands of individual capitalists is characteristic of capitalism, whereas property in the hands of the state is characteristic of socialism. Although anarchic production and distribution are no doubt qualities of capitalism, neither state planning nor state ownership does away with its basis. State planning on its own cannot even do away with the market, since commodities are being produced and distributed through exchange. The state is taking the role of price regulator instead of individual capitalists competing on the market. Instead of individual capitals extracting the surplus value, the state can do the same thing, since its social function is that of an employer of workers. This also means exploitation does not disappear, since wage labor persists. The socialist accumulation that Trotsky speaks of, analogous to the “primitive accumulation” at capitalism’s origins, really means nationalization, i.e., the concentration of capital in the state’s hands. It is clear that, although significant changes to property relations are introduced, the question of the mode of production is not tackled here. Instead it is skipped over, so as to deal with topics like ownership, exchange, and distribution. The mode of production is left intact, simply rechristened as socialism, as if calling it something else were enough to change it, believing that those aspects which are determined by the mode of production are able to determine it instead.

In his 1920 book Economics of the Transition Period, Bukharin also makes it clear that he thinks changes to property relations can change relations of production. Similar to Lenin and Trotsky, he seems to equate free market with commodity production, meaning that the latter can only materialize if the former is first set into motion. Bukharin recognizes the existence of exchange in the planned state economy, as well as the existence of the price form, but both are characterized as simply formal, without the content they would have with the existence of anarchic distribution and the free market. The same goes with wages, which still exist as a form, but are supposedly deprived of content. Commodity production, wage labor, and everything else will disappears in the transitional period, once workers achieve the “self-organization of labor.”

After the NEP was put in place, Bukharin changed his mind about commodity production in the transition period. He now recognized its importance, seeing it as playing a “very big role,” returning to old Lenin’s habit of treating the lower phase of communism as a kind of separate socialism, which according to Bukharin would entail the disappearance of commodity production and “bourgeois right.“ Also significant was Bukharin’s invention of the slogan “socialism in one country,” taken up by Stalin. According to their theory, given capitalism’s intrinsically uneven development, socialism is possible even if limited to just a single country. Prior to this, the unevenness of capitalist development had been used by Bukharin to argue for the continued viability of international revolution. At this time, he held that socialist revolution would have to be international, because of the international scope of capitalism.

Bukharin does acknowledge the centrality of mode of production, saying it is “what determines everything else.” He makes a mistake, however, in conceptualizing the road to its abolition. In Economics of the Transition Period, Bukharin asserts: “Capitalist relations of production are inconceivable under the political rule of the working class.” Not only is this an erroneous reading of Marx, but it is also nonsensical. The “political rule of the working class” is analogous to Marx’s dictatorship of the proletariat, itself a transitional phase on the way to communism, which means that the capitalist mode of production has not yet been abolished. Only the political structure has been transformed. But Bukharin’s argument implies that the mere seizure of power by the proletariat signifies the end of capitalism, qua the “impossibility of exploitation.” As it was with Lenin and Trotsky, the inversion of the materialist method is also quite clear. By conceiving the end of capitalism as the result of a mere change in political structure, Bukharin makes the same mistake as Lenin and Trotsky. He argues that the social reality is changed simply because a different group of people has now taken hold of it, no matter how much the previous social reality looks like the subsequent one. It seems that Bukharin confuses the transitional period with the early (“lower”) stages of communism, effectively eliminating the former while still retaining its name.

The “big role” commodities have come to play in the transitional period is exaggerated here in order to justify and rationalize the NEP. The role of commodities cannot be “big” or “important” since in the period of the dictatorship of the proletariat the workers strive for its abolition, and the transition in which they find themselves serves this purpose.

When it comes to converting the typical capitalist phenomena into socialism in name only, Preobrazhensky takes it to another level in his book, The New Economics (1926). This work concerns the actually-existing Soviet economy of the time, not a theoretical sketch of the concept of socialism. But his concept of socialism is expressed all the same. The existence of the state and state ownership once again finds its way into socialist society, which he describes as a socialist economy with commodity production and a “state sector,” similar to Lenin’s “statewide syndicate.” Preobrazhensky writes of two kinds of so-called “socialist accumulation.” One is “primitive socialist accumulation,” or state accumulation of resources outside the state domain, while the other is “socialist accumulation” proper, or state accumulation of resources within the state sphere. Primitive socialist accumulation requires expropriation of private capital and its concentration into the state’s hands, what we would refer to as “nationalization.” It is clear then that state capital is the defining characteristic of socialism, whereas capital owned by private individuals defines ownership within capitalism.

Central planning eliminates commodity production, and prices taken by products produced by labor units have a merely “formal character,” as do wages. Preobrazhensky recognizes the existence of surplus value as well, but does not count it as profit since it is extracted by a state which enforces central planning (rather than letting market forces decide). He distinguishes “underdeveloped” from “developed” socialism. Whether it is one or the other is determined by the extent of state ownership over the means of production. He posits “developed” socialism as having a larger share of state property than “underdeveloped.” The private sectors that remain within underdeveloped socialism confront the state sector with the law of value.

Whether in its “underdeveloped” or “developed” stage, Preobrazhensky treats socialism as a society that retains all the characteristics of capitalism. Except his socialism, like that of Lenin, Trotsky and Bukharin, has transferred ownership over the means of production from individual capitalists to the state in its developed stage. The so-called only “formal character” of profit, wages, and commodities, coupled with state property, cannot still exist and somehow be without “content,” because they belong to capitalist society and continue to fulfill the same function only under new ownership. By renaming this modified arrangement of capitalism “socialism,” Preobrazhensky hopes to justify state capitalism in Russia. He wants to avoid admitting that the economy he is describing cannot be characterized as socialist. Just like Lenin, Trotsky, and Bukharin before him, a mere change in ownership relations and political rule magically turns the capitalist mode of production into a socialist one.

At the beginning of the twentieth century, there had been a debate between Russian populists [народники], who promoted underconsumptionist arguments, and those who did not see the question of consumption as decisive for periodic capitalist crises. The latter consisted of Lenin, Bulgakov, and Tugan-Baranovsky, among others. They responded to the populists’ claim that capitalism would not be possible in Russia, since the proletariat produces more than it consumes, and so growth is not possible. Lenin and the others rightly stated that the goal of the capitalist mode of production is not consumption, but profit, and that expanded capitalist production is able to create internal markets, so that market expansion surpasses certain upheavals in the supply-demand relation in terms of growth. In other words, the inability to consume everything cannot stop the growth of capitalism. The question of the cause of crises followed soon afterwards. The answer from the antiunderconsumptionist corner was to suggest the anarchy of production would, in classic trial-and-error fashion, cause periodic crises. Lenin himself did not provide a clear theory of crisis, although he, Bukharin, Trotsky, and Preobrazhensky did consider it part of capitalism’s disruptive dynamic. When Henryk Grossman made a case for the third volume of Capital’s importance for crisis theory, he was highly critical of underconsumptionist doctrine. But the official doctrine of the “real socialist regime” had already adopted the theory of underconsumption, and was very harsh towards Grossman and his revival of Marx’s theory of the tendency for the profit rate to fall, responding by suppressing and banning his texts. Plus, Mikhail Tugan-Baranovsky claimed years earlier planning would eliminate crisis. So, even though it was not promoted, the Bolsheviks were leaning toward the notion that it was the anarchy of production which was responsible for causing periodic crises in capitalism.

But “anarchy of production” is tied to the underconsumptionist argument. It refers to the incapacity of the market to prevent overproduction. Since capitalists are, like workers, isolated from one another as well as from other consumers, they are not sure how much to produce or whether rate of consumption will stay the same now as the previous year. The basic underconsumptionist argument is that capitalism creates the unequal distribution that causes overproduction. The underconsumptionists of Lenin’s day thought that the inability to consume all that has been produced would halt growth. This argument would be repeated in the twentieth century as well, especially among so-called left Keynesians such as Joan Robinson. But the capitalist mode of production, as Lenin said, does not produce for consumption, but for profit. If the right investment is made, Marx also shows, profits will be made, since capitalists do not invest anywhere demand exists, but only where there is an effective demand, meaning one with money to buy. Capitalists do not care if there are unsatisfied needs as long as products meet effective demand. Underconsumptionists fail to recognize this, mistakenly thinking that capitalist society aims to fulfill people’s needs, and that if the investment is successful then the capitalist will invest further, which means that growth is certainly possible. Investment ensures accumulation, which pays out the wages workers rely on to consume. But it is erroneous to think, as many underconsumptionists do, that the means of consumption are separated from investment. For the investment creates demand, which then creates more demand, and capitalism continues to grow.

The anarchy of production theory and underconsumptionism make the cause of the crisis into its symptom. Because as profitability falls, capitalists on average reduce their costs in production, which prevent them from providing the sufficient supply. In all likelihood, a crisis will then ensue, and it will look like its cause is the lack of effective demand. However, it is the fall of the rate of profit which is in fact the root cause, whereas the underconsumptionist cause is only a symptom. Of course, this does not mean that everything produced will be consumed or that everyone will do so because of wages. Real imbalances between supply and demand do exist, and by no means do we the existence of the army of labor. The point is that capitalism enters into crisis whenever capital does, and capital is capable of reproducing itself despite turbulence in the supply-and-demand relationship, provided the level of investment “makes up” for it.

The rate of profit exists not only on a national but on an international scale. Even if every market were to be abolished, that means the competition among states would still exist. State planning does not eliminate the law of value, capital, or profit. And if all that is needed to prevent crises is to have a planned economy, then there is no point in promoting or calling for revolution. If capitalism’s contradictions can be reformed out of existence, a parliament is all that is needed. As already noted, socialists did not much pay attention to Marx’s third volume of Capital until Grossman made that pivotal breakthrough in the 1920s. But, as we will see (and I will talk further about underconsumptionist theories) although he was very influential, the great majority of Marxists failed to catch on.

Market socialism

Market socialism entails an economic system in which the key means of production are owned by the state or some other collective, like cooperatives, and which leaves space for markets as the best tool for allocating resources. Its form can be highly varied and eclectic; it can either resemble a Keynesian “mixed” economy or can look more like “pure” workers’ autogestion. The absence of markets and increased state control were viewed as the main vehicles used to suppress freedom in the experience of “really-existing socialist” societies, and so the emphasis on democracy became more pronounced among socialist theorists. Alec Nove outlined his version of socialism in two books — The Economics of Feasible Socialism (1983) and The Economics of Feasible Socialism Revisited (1991). Since there is not much difference between the two books, I will rely more on the second one in order to try and sketch my critique of his version of socialism.

Nove sets himself up as a critic of both the Marxist conception of socialism and the free market. He views each of them as impracticable. According to Nove, free market society exhibits a total disregard for people’s real needs, not to mention those of the environment, because it concerns itself only with the accumulation of more profit. Because the absence of planning — or rather an insufficient dose of it — chaos, wastefulness, and imbalances between supply and demand occur all the time. This is why market systems tend to generate inequality and excess waste through competition. On the other hand, Marx’s vision of socialism is infeasible because it is “utopian.” Self-management at the level of the whole of society, Nove argues, is “inconceivable.” Moreover, the capitalist law of value will have to continue operating in socialism, because its absence leads to central planning and despotism in the hands of the few. Here Nove refers to the Soviet Union, which he says represents the classic model of Marx’s disastrous idea of socialism. The universal development of individuals envisioned by Marx would also be impossible to achieve, because it presupposes conditions of unlimited availability of goods and services. The idea of having a society allocate its resources according to its needs is regarded as utopian. Commodity production, on the other hand, is not opposed to socialism, since commodity production has always existed in all societies, which is why there is no reason we should expect it to disappear in socialism.

To balance the inequalities which are generated by the unregulated market, Nove supplements it with the public ownership of key resources and limited planning. At the same time, though, an absence of markets leads to authoritarianism and to a consequent lack of freedom, which in turn provokes economic crisis, because of the failure of societies such as the Soviet Union to execute rational regulation. They too, as Nove rightly observes, create waste and inefficiency. Nove suggests that in his “feasible socialism” markets would, although they are imperfect, continue to function to an extent, utilizing the rationality of market regulation to create “prices which balance supply and demand, that reflect cost as well as use value.” The necessity of profit, labor markets, interest, and rent are all accepted and kept on board in this “feasible socialism,” but no one would be able to solely live off an income extracted from mere ownership of goods.

The political structure of Nove’s society would be a parliamentary democracy with elections occasionally so people could “avoid feeling alienated.” Moreover, in addition to owning the key means of production, the state would also have elected committees to appoint managers for the firms. These managers would listen to the employees in terms of what they think should be produced, Workers would have input about major investments as well. The state would also intervene to limit the monopoly of certain firms over the market, ensuring every firm gets its chance. Planning would not be executed on a state level, but would instead on the level of individual firms. These firms would effectively coordinate supply with demand, but will also ensure high quality products at the same time. To summarize, Nove thinks that planning combined with markets is the most important ingredient to a society that would be suited to most people.

Although I will not dedicate too much time dealing with how Nove treats Marx’s version of socialism, because the goal of this whole discussion is supposed to be about capitalism, I will say a few things that will hopefully shed some light on the concept of capitalism Nove uses as well.

His argument that the law of value’s absence leads straightaway to authoritarianism is puzzling. Its absence in the case of Marx’s communism, to which Nove refers, does not entail any kind of government. Political structure as such would cease to exist in communism, and with it any kind of authoritarianism.

Regarding the issue of abundance in Marx’s version of socialism, here Nove demonstrates a neoclassical conception of the human and her needs, saying in effect that a human being can only be free if there is an unlimited supply of commodities for her to consume. He is asserting this definition as something that just is, as an universal definition, in very much the same way as neoclassical economists assume that their supposed knowledge of human nature is eternal. This goes hand-in-hand with the lack of clarification of the concepts of capitalism or socialism in Nove’s book. Marx, however, deployed a different meaning of abundance, which, of course, includes the material aspect of abundance, but also includes freedom from conditions of work which remain within a “realm of necessity.” This entails non-material abundance as well, the satisfaction of human needs of a higher order, as the things people would be free to do without material coercion will generate far more material and intellectual goods and services, and that means that the activities which would dominate in a socialist society would continue to contribute to the overall growth of abundance (though not as much or as fast as in capitalism).

While the question of how material abundance will be realized under socialism is not easy to answer, the curious thing here is that Nove views market mechanisms as systems that produce economic equilibrium. Indeed, this is exactly what the fiercest promoters of the free market emphasize, the views of whom Nove professes to criticize. The problem that Nove has with unplanned markets is they only pursue profit, blinding them to the supposed fact that demand is what ought to determine production in a market system. Planning will eliminate that blindness, and companies will invest only where demand already exists. This will eliminate imbalances in the nexus of supply and demand, while reducing inequality. The prices people are prepared to pay, says Nove, serve as “price signals,” telling individual firms what to produce and how many workers should be employed. But “price signals,” as Marx’s example of Department A and B shows, cannot tell the companies what products will be demanded, but rather what was demanded the year before. Nevertheless, Nove seems to think companies amend their prices to consumers’ wishes, and that demand is the only thing they will be concerned with. This fits into the neoclassical definition of a perfect market, or maybe an almost perfect market, according to which no antagonisms exist between companies, from which it follows that price modification has nothing to do with that antagonism. But contrary to Nove’s view, which he shares with underconsumptionists, companies do not produce in order to satisfy consumers, but to realize profit, and profit can be realized only where there is an effective demand, Not just any demand. Of course, capitalists will not make a profit if they produce something that no one will buy, but satisfaction of human need is not their motivation. Contrary to Nove and the neoclassicists, companies do not exist peacefully on the market but tend to undercut their competitors by reducing prices. Hence, the motivation to influence prices is connected to the fact that competition is antagonistic. Whenever productivity rises, capitalists extract more surplus value and hence increase their profit rate — for a while, at least. This picture is opposite to Nove’s, according to which profits, which fuel the economy, are set aside for the sake of a peaceful competition among companies that only care about consumers. Nove believes this peaceful competition would supposedly happen if markets are merely “tamed.”

Nove’s insistence on consumers’ willingness to pay as effective regulators of price disregards the fact that prices are set by labor time. Of course excessive supply or demand, and the domination of a certain company’s output can determine the increase or decrease of prices, but productivity’s role in price determination is crucial, and quite observable as well. Farmers know, for example, the price of their product will be higher after a bad harvest than after a good one.

Nove emphasizes the need for the state to intervene in market mechanisms in order to ensure a “fair game” for all the companies on the market. This entails preventing monopolization by those companies which tend to consolidate of the market, along with a “fairer” distribution of income. This can undoubtedly be done, and it has been done in certain periods of capitalism. But this does not promise “feasibility” in the long run, because the lifeblood of capitalism is the accumulation of profit, and preventing monopolization in the market will only serve to reduce profits. Increased salaries and employment tend to reduce profit as well, as they take away a larger portion of the company’s profit. Though an increase of profitability can occur alongside a rise in wages, these cannot rise faster than productivity. The correlation productivity and profitability key here, since even a “fairer” distribution of income does not ensure an increase of productivity. When capital is “left alone,” in the sense of not being burdened by sanctions, only then does it shows a tendency to be most productive. Increased spending on variable capital should increase consumption of what has already been produced, but increased consumption does not hold a guarantee for the next round of production, since higher profitability is needed to complete this next round. In other words, increased wages would help sell the products that are on hand, but they would not induce more production, because spending more on wages reduces profitability and creates difficulties for capitalists competing on the market. Should higher taxation, for example, or other means of reducing profitability were enforced in every country, as Nove seems to advocate in his “socialism,” then capital would not be able to flee to other countries were these policies were not put to practice. But this still would not eliminate the possibility of reduced profit rates. Precisely that is what happened during the so-called “golden age” of social democracy, starting at the end of the Second World War and lasting up until the mid-1960s, when capitalism did experience several crises due to the restrictions in accumulation. Surely no one thinks that during this period underconsumption was the issue, since capital reached compromises with the working class in terms of income distribution at the time. Of course, crises are less painful when wages are higher, but as Marx pointed out, such higher wages are often a sign of an upcoming crises, because they signify a reduction in profitability.

Since wages, profit, the state, and markets would be part of Nove’s socialism, as well as alienated labor, in keeping with the law of value, it is hard to say how this kind of society is different enough from capitalism to deserve the name socialism. Even Nove asks himself “Is this socialism?”, fearing that he might actually be proposing just another form of capitalism. Of course, the answer he gives to the question he poses himself is negative, but we would beg to differ.

Richard Wolff is another theorist not too keen on economies patterned after the Soviet Union. Instead of insisting on its inability to manage planning, Wolff says Soviet-like societies did not end exploitation, and thus cannot be described as socialist, only state capitalist. He is equally critical of what he calls “private capitalism,” as it too does not end exploitation and withholds surplus value from the workers. Wolff suggests a model called “workers’ self-directed enterprises” (WSDE), which he outlined in his Democracy at Work: A Cure for Capitalism (2012). According to this model, workers would make decisions about production and distribution, unlike at capitalist firms, where they are made by the owners, shareholders, and state bureaucrats. Workers would decide what to produce, which technologies to apply, and so on. Consensus would be reached through the “democratic process.” They also collectively appropriate surplus value, which partially goes to paying taxes to the government, and partially to further investment in the company. He contrasts his model with worker-managed enterprises where managers are appointed by boards of directors. By contrast, in WSDE, boards of directors would consist of workers, and not just any workers, only the productive ones. The nonproductive workers, who will be hired by the productive workers, are called “enabling workers.” Enabling workers, Wolff says, will also participate in the “democratic process,” but productive workers have their final say. They will also not introduce technological innovations that might put certain workers out of a job. If that does happen, however, there would be “specialized agencies” which would make sure that these workers get employed by other firms, acting as “matchmakers.” Furthermore, the state would get involved, providing advance paychecks instead of the regular unemployment benefits. On the ownership question, Wolff allows for several possibilities. Either WSDEs would be owned by the workers, or the state, or the mixture of state, regional, and local ownership. Although he leaves it an open question, it seems like he personally prefers the option of workers owning their own firms.

Prior to outlining his prescription for the “cure to capitalism,” Wolff dedicates a significant portion of his book to an interpretation of how capitalism works. I won’t go into too much detail about this, but will talk about portions of it which throw his proposed “cure” to capitalist society into doubt.

Rejecting both private and state capitalism, Wolff says they are capitalist because they have the capitalist mode of production in common. The capitalist mode of production is, for him, a relation between workers and capitalists. Workers have to sell their labor power to capitalists, who in turn extract the surplus value for themselves and pay the workers wages for their time. Workers do not have a say in production, since shareholders, boards of directors, etc., make those decisions for them. For Wolff the capitalist mode of production involves power relations over surplus value. Of course, as he says, the disentanglement of the “economic” and “political” sphere is unique to capitalism. Workers in capitalism are politically free to starve to death if they so wish, as there is no government coercion. But this is hardly what constitutes this mode of production as a whole. If only power relations at stake, then capitalism would be the same as feudalism and every society that came before. The capitalist mode of production is the production of value as a consequence of alienated and commodified labor. Although the dichotomy between workers and capitalists is apparent, there is no absolute need that it exist for surplus value to be produced, as it is the functional separation of alienated, commodified labor which “causes” the production of value, meaning that the role of capitalists and the role of workers can be embodied in a single person. Surplus value cannot be therefore be eliminated by “democratic” processes. Wolff says that exploitation would be eliminated in the WDSEs, but at the same time asserts over and over again that workers would be in a position to collectively appropriate surplus value. How are they going to do that if exploitation is supposed to be abolished? It looks like exploitation for Wolff is not the extraction of surplus value, but rather the workers’ inability to make workplace decisions, which seems curious, as surplus value quite obviously exists independently of decision-making power.

Moreover, since he claims to be a Marxist, it should be obvious to him that the extraction of surplus value comes from dividing the work into concrete and abstract labor. The former giving workers the means to reproduce, while the latter is appropriated as surplus value. Of course, it is the managers’ job, among other things, to make sure production is running smoothly in order to increase the surplus value. And of course this is authoritarian and dismissive of the workers’ interests, because managers are paid enforcers of the capitalists, and therefore workers’ class enemies. This exploitation will surely continue to exist in WSDEs, since exploitation means extraction of surplus value, and workers in WSDEs will have an interest in increasing its rate, just like any other capitalist. Capitalists do not extract surplus value just for personal consumption, but also for further investment in their company, which is exactly what WSDEs would have to to, since WSDEs do not abolish value, capital, commodities, or exchange. Therefore, they will be forced to act as any other company would in the market.

Curiously, Wolff says nothing about the workers’ personal consumption. Surplus value, he claims, will be divided among workers, and will be used to pay taxes and to further invest in their company’s future. That is, if we assume the workers to have sole property rights, and thus act as their own capitalists. If enterprises are partially owned by the state, then the decision-making powers exercised by the workers would probably be at least somewhat curtailed, since the state would then doubtless be able to exert control over the company, to some degree. What are workers going to live off of, after all? Wolff says nothing whatsoever about wages, because in the previous section, on capitalism, he had stated that wages are what the capitalists pay workers. This is probably because he views wages the same way he views the capitalist mode of production — i.e., as a relationship between people. However, a wage is a logical consequence of a state in which workers who sell their labor power are alienated from their products. Since they cannot use it for their own immediate consumption and exchange it with others on the basis of use value, they have to receive a wage in order for them to reproduce their physical existence. This does not rest upon a specific relationship between certain individual persons, but upon a specific social relation, which presupposes alienated labor, and which still, as we saw, exists in WSDEs. This means either workers would have to begin paying their own wages, or the state would provide it for them.

This underscoring of relationships between people instead of on the social relations is visible in the bit he has about workers’ decisions concerning technological innovations. Mixture of ownership can lead to several different outcomes on this score, for instance the state reducing productivity to decrease unemployment and raise wages, which would in the long run put downward pressure on the rate of profit. Or, in the case of workers being their own capitalists, it would be in their best interest to invest in technological innovations to undercut competitors, which would likewise in the long run and on the level of the average profit rate, likely ensure future crises because of the tendency for the profit rate to fall.

The care that workers in WSDEs would supposedly display towards other workers, who would have to be laid off due to technological innovation, would mean a loss for all workers, because that would either put them in a disadvantaged position on the market, or it will run them out of it, leaving workers unemployed. The “specialized agency” dedicated to helping displaced workers would either succeed in finding them future employment in a WSDE that has not yet introduced this technological innovation, only to be fired when the technology advances, or they would likely be rejected by other companies, which have already adopted this innovation. These laid-off workers can, perhaps with a financial boost from the government, establish another firm that will produce something else. But in all likelihood they will face this same situation again regarding the need to introduce new technologies to survive on the market, and will have a tougher time dealing with more experienced WSDEs in that field of production. This means unemployment will certainly be a part of the WSDE system.

This is perhaps the main contradiction of capitalism, the “can’t live with it, can’t live without it” quality it possesses — its boundless capacity for growth is at the same time the best guarantee it will self-destruct. Yet for Wolff, the main contradiction consists in the unequal distribution of income, supposedly responsible for economic crises. In fact, there is little evidence that inequality or low wages cause crises. Investments tend to fall before a crisis ensues, and much more regularly than consumption. Investments fell in every postwar crisis except one mild one in the 1953-1954. In fact, in the US since 1947, there has been more pronounced change in the rate of profit than in the level of wages, meaning that, compared to the rate of profit, the level of wages did not show the tendency to fall. In the US, corporate profits usually stop growing, stagnate, then start falling before a crisis ensues, before a decrease in consumption, which is what usually happens after the crisis has already begun.

Returning to underconsumptionism, these theorists tend to assume that products must be produced for “the people,” or for personal consumption. Consumer goods, however, do not make up for the whole of the demand. In Marx’s example of Department A and B, one produces commodities for the consumer and the other for investment demands, firms use commodities too. Between the means of production and up to the final product there lies a series of commodities which in turn serve as a means of production. One product produces the other, the second produces the third, and so on until the final output. If investment demand is indeed sufficient, which entails accumulation of value through sale and employing larger number of workers because of increased investment demand, then growth would be possible. If, for example, the total value of output is 10,000, consumption demand 8,000 and investment demand at least 2,000, then there would be no slump. But if the investment demand is less than that, there would be slump. But the slump would not happen because of the lack of consumption demand, because consumption demand remains at 8,000 in both cases.

The Mondragón experience which Wolff sees as very important, is just what one might expect to happen when individual capitalists firms gradually start to incorporate themselves into capitalism. Sharryn Kashmir’s book The Myth of Mondragón details how Mondragón workers’ interests were gradually disregarded, how they fought for higher wages while benefiting the managers more than workers. And when it comes to cooperatives, there are several more companies which testify to this development. Good Vibrations is another example of a company that eventually instituted strict hierarchical order. If we forget everything else, Wolff himself introduces this threat to his WSDEs by dividing workers into productive and nonproductive, in terms of the power they possess. Of course, none of these things necessarily happen, but when the opposite is the general norm and a company must be competitive, it is much easier to conform to the general laws. I think it is clear from all of the elements from which WSDEs are comprised that Wolff is just talking about a different form of capitalism, which could be better achieved by revolution than by the gradual integration of WSDEs into society. But then we are faced with the same issue as the state socialists, which is the question of why is it sensible to destroy one mode of production through a bloodbath only to reinstate it afterwards. This question is directed especially to Marxists like Wolff, who claim to want people to get rid of capitalism.

Another market socialist who focuses on democracy, as Wolff does, is the economist Yanis Varoufakis. Part of the Democracy in Europe Movement 2025 (or DiEM25), whose manifesto says one of main the ills of today’s Europe is its betrayal of democratic principles, he rarely talks as much specifically about socialism as he does about the democratization of Europe. But in his TED Talk, he did go into certain details regarding the former. So, I will try to complement this Talk with his famous “Confessions of an Erratic Marxist Amidst a Repugnant Eurozone Crisis” essay in order to get a clearer picture.

Although he sees himself as Marxist because Marx correctly discovered capitalism is like an Ouroborus in that grows by destroying itself, he nevertheless claims that Marx’s views on how to achieve socialism result in authoritarianism, because Marx did not consider that a young workers’ state would soon “be afflicted by the virus of totalitarianism” while the rest of the capitalist world would became more “civilized.” Similarly, Marx’s view of capitalism in general is closed and dogmatic, determined to have the final word while pretending to be empirically correct.

In this respect, Varoufakis says, Keynes had a better solution. Since Varoufakis views capitalism as a system that is not always able to recover from a crisis, it needs state intervention to keep itself going, but cannot do it on its own. This was Keynes’ proposal: pumping up the economy until approaching full employment. Although Varoufakis would rather promote socialist policies, he instead promotes what he wrote in his “Modest Proposal for Resolving the Euro Crisis,” which “does not have a whiff of Marxism in it,” since promoting socialist policies did not get us anywhere before. For example, socialist policies weren’t installed in Thatcherite Britain, because people the swallowed neoliberalism pill hook, line, and sinker. That is why it is today “more realistic” to advocate for Europe to “save capitalism from itself,” which would also “minimize the unnecessary human toll from crisis.”

Since democracy (i.e., “real democracy”) is needed, unlike that authoritarian Marx’s project, we should try to establish something similar to Athenian democracy, only adjusted to the present day. This means workers having the opportunity to decide what they produce as collective owners of the companies where they work. This would be a “Star Trek-like society” and would be extremely different from capitalism. In fact, Varoufakis’ description of it sounds similar to Marx’s description of daily life under communism, where we could spend nearly all our time on the activities we like (Varoufakis mentioned talking about the meaning of life “in some ancient, Athenian-like high tech agora”).

The “erraticism,” as Anwar Shaikh pointed out in an interview, stems not from his sobriety over Marx’s alleged mistakes about claims of empiricism, but rather erraticism within the Marxist tradition. Marx’s Capital is not a testimony to empirical capitalism, but serves as a conceptual framework for understanding the general qualities it possesses. Besides, Marx intended to write six books on Capital, containing several volumes each. Marx did not have the advantage of living long enough to witness the unique changes that occurred over the second half of the twentieth century, involving various state interventions and so forth. He did not have the empirical evidence we have at our disposal today. Even if Marx had been some sort of a messiah, the need for extension, supplementation, and further analysis of his theory is implied by the very fact of capital’s development. Marx was very much aware of this.

The belief that the road to socialism is inherently authoritarian cannot be defended, either conceptually or empirically. The concept of the “workers’ state” that Varoufakis ascribes to Marx cannot be justified, given that Marx did not envision a transitional society but a transitional period that would only serve as a political advancement in progressing towards a different form of production. Varoufakis either does not understand Marx or mistakenly attributes Lenin’s interpretation to him. The goal of the transitional period is to transition, not to a workers’ state but a society without classes, without private property, lacking any form of political structure. Economically and politically communism will not, therefore, suffer from any kind of authoritarianism. Perhaps even worse, Varoufakis seems to think Marx had socialism in one country in mind. He should have continued reading Lenin, at least, to see this is not true. It would be absurd, given the international character of capitalism and the fact a lone socialist country would either have to adopt some version of capitalism or else die out, as indeed ended up happening with the USSR. Varoufakis is pinning Stalin’s moustache on Marx’s face, so to speak. There could be no single socialist country among a capitalist majority, and no amount of striving could ultimately achieve it.

But this argument is even more ridiculous if we so much as superficially examine the empirical evidence. When Varoufakis claims Marxian socialism was authoritarian, whereas the capitalist countries surrounding it were “civilized,” he is no doubt referring to the USSR. The notion that the capitalist countries acted in a “civilized” manner while the Soviet Union was authoritarian is strange. Does he believe Nazi Germany and Fascist Italy were “civilized” capitalist countries?

Or perhaps the US during its war with Vietnam? Or maybe he thinks of the US violently overthrowing Allende in Chile, or perhaps Allende himself disarming revolutionary workers in order to prevent them from achieving some sort of socialism that would threaten his presidency. It is not clear what he means by “civilized,” but judging from the context, I would guess it means putting more emphasis on human rights, which I guess these countries did not have many problems with according to Varoufakis.

From all this, the type of society the DiEM25 calls democratic workers management and which he calls “real democracy” fits neatly into his understanding of capitalism, history, and politics. We need a lots more democracy to overcome Marx’s authoritarianism, and we need some Keynes because Marx did not handle the issue of capitalist development and crisis quite so well. The idea of slow growth and the inability of capitalism to recover after a crisis is what he picked up from the neo-Keynesians, though in a crude manner, explaining crises through the theory of inequality and underconsumptionism. But crises function as a way for capitalists to recover from profits being “smothered,” and profitability always goes up sharply after the crisis, no matter how slow or how much time it takes for the economy to recover.

Keynesianism, on the other hand, has shown little promise as a long lasting cure for the ills of capitalism. The idea that system could be improved by pumping state money into the economy in order to boost the demand countercyclically and increase profitability and reduce inflation all turned out to have major problems. It was thought you can have either full employment or inflation, and the Phillips Curve was devised in order to show this empirically, but the 1970s proved that it is possible to have high unemployment and high inflation simultaneously. Besides, artificially pumping up the system cannot be been done without consequences, as the burden of increased wages and higher employment puts more pressure on profitability, which then reduces further growth.

Although Varoufakis’ desired society does not really resemble the Keynesian one, it is complementary to it. Both models arise from issues of aggregate demand. If there is low consumption and lots of unspent money in the pockets of capitalists, underconsumptionists like Varoufakis add, the economy is heading toward crisis.

I have already covered underconsumptionist theses, so I will not do so any further. I will, however, say that the tendency of the profit rate to fall (i.e., the recurrent cause of crisis) entails a nonequilibrium understanding of the capitalist economy. Varoufakis sees capitalism in precisely the opposite way, as an equilibrium economy. If we view it as an equilibrium, that often means labor time does not affect prices at all and that commodities retain the same prices. And if they do this, profitability must rise and will never fall. This is the famous Okishio theorem, of which Varoufakis is probably well aware. But viewing capitalism as an equilibrium economy, while compatible with Keynes, is not at all compatible with Varoufakis’ view that capitalism eventually eats itself by growing, i.e. accumulating profit. This is the erraticism of Marxism that Anwar Shaikh talked about.

So, disregarding the tendency for the rate of profit to fall and sticking to the underconsumptionist theory, his vision of workers as their own capitalists is something he thinks is feasible. But while with Wolff there is some doubt about the role of the state, here things are fairly clear. Workers’ democracy would somehow wish away the mode of production simply by eliminating the dichotomy between workers and capitalists. Production of surplus value would remain, as would the alienation of worker-capitalists from their product and from each other, competition, crisis, and so on. It is clear that this is simply a matter of modifying capitalism as we know it today, retaining its features while calling it socialism.

Conclusion

Innocent misrepresentation, avoidance due to negative historical associations, or deliberate distortion of Marx’s ideas might lie with some of these authors. As capitalism experiences periodic booms and slumps, so does the inspiration drawn from Marx’s ideas. It is difficult to read Marx, though, not so much because he is hard to understand, but because he was notoriously prolific in his writing. For certain problems Ricardo and Smith would write thirty pages. From there, Marx would expand upon their work, adding hundreds of pages of his own commentary and criticism. The same thing often happened when he polemicized with others; his debate with Proudhon comes to mind, although Marx did say to Engels that he would like Capital to be rewritten as a shorter version. But judging from his life, he would have just expanded on his work had he lived longer. He was even teaching himself Russian at one point because he thought, for whatever reason, that rent developments in Russia is a good case study of rent development in general. For other reasons, we cannot be so studious or ambitious, but we can at least try to study him with openness and honesty.

The most important contribution of Marx’s political economy is understanding the nature of capitalism and the relationship of its microorganisms to one another. The conclusion at which he arrives, i.e., that capitalism cannot be saved from its contradictions, is, of course, key. But this conclusion could be reached by anyone. People of various political positions may wish for capitalism to be abolished. The difference with Marx and certain Marxists is their effort to understand why this conclusion asserts itself with such strength. Nor can this question be brushed off by focusing on certain parts of political economy while ignoring others. The theories that I have examined here testify to the enduring flexibility of capitalism, which makes the task of answering the question “What is capitalism?” more difficult But they also testify to the lack of definition, and the need to reconnect the dots between them. Some examples take only a certain type of ownership as characteristic to capitalism rather than all types. Others confuse the transformation of democratic processes within workplaces with the mode of production. Yet others completely ignore the role of profit in crises. This paper is a modest attempt to clarify certain things about Marx’s analysis of capitalism, and I hope it will serve as both a reminder of the importance of coming back to basics and as a further stimulus for diving into more complex matters. While the latter is difficult and time-consuming, the theoretical frameworks that attempt to jumpstart, skip, or misconstrue vital elements only lead to greater confusion. And that is certainly not the outcome that we desire.

Sonja Krivokapić

Zagreb, Croatia

October 2018