Tag Archives: Keynes

Hayek Versus Keynes: The Clash That Marginalised Marx?

16 Wed Sep 2015

Posted by in Anti-Capitalism, Critical Theory, Macroeconomic Analysis, Open Economy Macroeconomics, Political Economy

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GrantKeynesLUMPENPROLETARIAT     Every once in a while, our comrade Mitch Jeserich [1] at KPFA/Pacifica Radio’s Letters and Politics will discuss political economy and various economic topics.  A notable broadcast recently (from home due to an injury) finds KPFA’s Mitch Jeserich speaking with Nicholas Wapshott, author of Keynes Hayek: The Clash That Defined Modern Economics and Ronald Reagan and Margaret Thatcher: A Political Marriage.

During this broadcast, Jeserich refers to Keynes and Hayek as the two most important economists to understand, in terms of understanding contemporary economics.  So, it’s notable how quickly Jeserich forgets Marx.  Or, perhaps, Jeserich ideologically opposes Marx’s work, and, so, self-censors (however unconsciously).  So, in certain regards, Jeserich’s exposure to the work he presents on free speech radio isn’t as cumulative as we might like.  For example, Mitch Jeserich has frequently broadcast Dr. Richard D. Wolff on Letters and Politics, and often discussed (and agreed with on air) Wolff’s analysis of Contending Theories, and the bifurcation and trifurcation of economic theory in the academy, namely how Marxian analysis is kept out of the academy and profession.  So, Jeserich forgets about Marx, or he chooses to overlook Marx; the effect is the same.

Friedrich_Hayek_portraitListen to, or download an mp3 of, the interview here:  Letters and Politics, September 16, 2015, 10:00 PST, 94.1 FM, KPFA, Berkeley, California.

Jeserich asked Wappshot whether Keynes, like Hayek, took on the issue of state tyranny (c. 50:55):

“Yes, because, um, Hayek sent him a copy of The Road to Serfdom, which he read very excitedly and wrote him a very generous letter.  And he said:  Thank you for this very important book.  And I’m glad that you’ve written it.  And there are a lot of lessons in it, and it’s very well-timed.  And I take your message entirely.”  But, then, he went on to say in very typical Keynesian way, having flattered, he said:  Now, I notice that you say in Road to Serfdom, even in your ideal state, where the government is as small as it might be, that includes of course defense and policing and things like that, that every state must have, but you also mention that in order for the market to work properly you should at least guarantee that people are housed, have food, and have proper social security, which isn’t that exactly what I’m saying?  All we’re saying is a matter of degree, of where to draw the line.  I just think that it ought to be drawn further over here.  And you think that it ought to be drawn further over there.  But the principle objection that you have to state existing, to the government existing at all, doesn’t seem to apply.  And, so, that was Keynes’ response to Hayek on that issue.”

[This article is a rough draft under construction.  Check back to read/experience the final draft.]

Messina

***

LETTERS AND POLITICS—With Nicholas Wapshott, author of Keynes Hayek: The Clash That Defined Modern Economics and Ronald Reagan and Margaret Thatcher: A Political Marriage. A former senior editor at the LondonTimes and the New York Sun, he is now international editor at Newsweek. 

About the book:

As the stock market crash of 1929 plunged the world into turmoil, two men emerged with competing claims on how to restore balance to economies gone awry. John Maynard Keynes, the mercurial Cambridge economist, believed that government had a duty to spend when others would not. He met his opposite in a little-known Austrian economics professor, Freidrich Hayek, who considered attempts to intervene both pointless and potentially dangerous. The battle lines thus drawn, Keynesian economics would dominate for decades and coincide with an era of unprecedented prosperity, but conservative economists and political leaders would eventually embrace and execute Hayek’s contrary vision.

From their first face-to-face encounter to the heated arguments between their ardent disciples, Nicholas Wapshott here unearths the contemporary relevance of Keynes and Hayek, as present-day arguments over the virtues of the free market and government intervention rage with the same ferocity as they did in the 1930s.

Learn more at LETTERS AND POLITICS.

***

[1] Mitch Jeserich is the host of Letters and Politics, KPFA radio (Berkeley, CA) and the Pacifica radio network throughout the nation.

[Images are used for educational purposes under creative commons licence, CC BY-SA 3.0.]

[10:08 PST  8 OCT 2015]

[Last modified 14:35 PST 8 OCT 2015]

Celebrating Consumerism? The Commodity Form as an Emancipatory Force

26 Tue May 2015

Posted by in History, Macroeconomic Analysis, Open Economy Macroeconomics, Political Economy

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kpfa-free-speech-take-it-back-logo-121199LUMPENPROLETARIAT—Rutgers University Professor of History, Dr. James Livingston, is the author of Against Thrift: Why Consumer Culture is Good for the Economy, the Environment, and Your Soul (Basic Books, 2011) as well as op-eds for Wired, The New York Times, the Los Angeles Times, and The Christian Science Monitor.  In his book, Against Thrift, Dr. Livingston presented various controversial arguments.  Today, on free speech radio, Against the Grain (KPFA, 94.1 FM, Berkeley, CA, Pacifica Radio) broadcast a discussion with Dr. Livingston.  Listen here. [1]

Dr. Livingston challenges his readers/radio listeners to reconceptualise the commodity form as a force with emancipatory effects for humanity.  Dr. Livingston raises some interesting questions.  And, perhaps, his zeal in advocating for the power of consumerism for socioeconomic wellbeing adversely overpowers, as when he seems to advocate for marketing to children, despite its attendant perils of branding and corporations building lifetime cognitive associations in children carrying forward into adult fetishism of corporate logos and identities.

Dr. Livingston described various theories of capitalist crisis and emphasised one problem with the capitalist mode of production, in particular:

“I’m with the pro-capitalist theorists of the last century, the guys who invented the Federal Reserve, in saying:  No, it’s not these four Ms, although there’s enough truth in each, it seems to me, to warrant a careful study of these claims.  The real problem is surplus capital. [2]  That is, the real problem is the distribution of income:  Too much capital seeking too few productive outlets.  That’s the cause of the recent crisis, just as it was the cause of the Great Depression.”

This is, essentially, a Post-Keynesian argument describing low aggregate demand, or low consumer spending.  However, as Dr. Hyman Minsky (1919-1996), Dr. L.R. Wray (b. 1953) [3], and other Post-Keynesian economists have shown, Dr. John Maynard Keynes’ (1883-1941) ideas came to be distorted by others’ attempts to reconcile Keynes’ work with the extant (neo)classical economic orthodoxy or to mathematically model Dr. Keynes’ concepts as with the IS-LM model.  Joan Robinson (1903-1983), a colleague of Dr. Keynes, called these theorists who introduced Keynes’ ideas (in modified form) to the world as the Bastard Keynesians [4] because they bastardised, or debased, Keynes’ main arguments.  (Bastard Keynesians are also known, more neutrally, as the Textbook Keynesians because of their predominance in economic textbooks of the mid-20th century.)  Whereas Dr. Keynes argued for government intervention to increase consumer spending and capitalist investment as a means to stimulate economic activity, Bastard/Textbook Keynesians focused their policy prescriptions upon incentives aimed at capitalist investors, propagandised today as the job creators.  This shifted focus away from Keynes’ advocacy for public spending for job guarantee programmes, as developed during the USA’s New Deal, under the influence of Keynes’ ideas. [5]

Post-Keynesian analysis recognises that firms and corporations have no incentive to invest when aggregate demand is low.  Dr. Livingston understands this and, so, argues for a reconceptualisation of consumerism.  However, as the interviewer suggests, this approach may apply only narrowly to the already well-off middle class.  One important aspect, which Dr. Livingston seems to overlook is Modern Money Theory (MMT) as well as the economically viable, but ignored, concept of a government job guarantee. [6]

—Messina

***

AGAINST THE GRAIN—Could spending be virtuous and thrift bad? Left-wing economic and cultural historian James Livingston thinks so. He suggests — taking on the 19th century Populists, the Frankfurt School, and current economic orthodoxy along the way — that consumption is good for social justice and the environment. Livingston argues that, in place of austerity and frugality, investment should be socialized, wages increased, and the workweek.

Learn more at AGAINST THE GRAIN.

***

AGAINST THE GRAIN—”Today on Against the Grain:  Could spending be virtuous and thrift bad?  Left-wing economic and cultural historian James Livingston thinks so.  He suggests—taking on the 19th century Populists, the Frankfurt School, and current economic orthodoxy along the way—that consumption is good for social justice and the environment.  I’m Sasha Lilley.  We’ll hear my conversation with Livingston after these news headlines.”

[SNIP]

[This is a rush transcript. This transcript is currently under construction.]

[SNIP]

SASHA LILLEY:  From the studios of KPFA in Berkeley, California, this is Against the Grain on Pacifica Radio.  I’m Sasha Lilley.  Both, before and after the financial meltdown, the conventional wisdom about Americans has been the same: We spend too much, save too little, consume too many resources, are manipulated by advertisers, and buy a lot of junk, that ends up in massive landfills.  James Livingston wants to upend your thinking on those assumptions entirely and argue the opposite, that frugality is bad and consumption is good.  No, he doesn’t work for Madison Avenue, but, rather, is a left-wing economic and cultural historian.  He teaches at Rutgers.  And he’s written a polemic called, Against Thrift: Why Consumer Culture is Good for the Economy, the Environment, and Your Soul.”

[SNIP]

[This is a rush transcript. This transcript is currently under construction.]

[SNIP]

LILLEY:  [SNIP]  “What about this question of consumption and resources, consumption and—”

DR. LIVINGSTON:  “Yeah.”

LILLEY:  “—the environment.  All around us, we see the ravages of the environment.  And you make the point that humans have always been involved in shaping the environment, that we’re not some interlopers from outside.”

DR. LIVINGSTON:  “Right.”

LILLEY:  “And, even if we assume that’s all true—and you have me there; I agree—what about this destruction of resources by consumer capitalism?”

DR. LIVINGSTON:  (c. 48:26) “Yeah.  Well, I think that you’re absolutely right, that this is the most controversial claim in the book. [chuckles]  I can’t seem to convince anybody, not even you.  When I say, not even you, I mean it’s pretty clear that you’ve read the book very, very carefully.

“My primary example in my chapter where I talk about the environment is the food revolution.  It seems to me, since the 1970s, consumer boycotts of that industrialised food chain have changed the way we produce food, distribute food, consume food, and prepare food.  And I think that, as an environmental achievement, can’t be exaggerated.  I think that’s an extraordinary achievement.  So, that’s one way to put it.

“The other way to put it is:  If consumers have the requisite income and the proper facilities, they typically do two things:  First, they buy vehicles with better mileage, if they can, if they have the requisite income, and if the things are available.  They did it in the 1970s in an overnight switch to Japanese cars, which were, both, better built and had better mileage than American-built cars.  But I live in New York City.  If people have clean, reliable mass transit, not only will they use it, but they will use it by the millions every day.  And it will be a whole lot less destructive of the environment.

“So, in that sense, we need to rethink all of our transportation planning priorities.  And this is nothing new to you; I’m sure.  But I think consumers can lead the way and have led the way.  I mean they certainly have led the way in New York City.  Nobody drives.  I mean I own a car; but I don’t drive a whole lot.

“So, those are two examples, it seems to me, that environmental integrity can be delivered by empowered consumers.”

LILLEY:  “But that seems to run up against this issue, which is sort of an open question throughout the book around social power.  I mean consumer boycotts have worked in specific cases.  But they’re very hard to apply across the board.”

DR. LIVINGSTON:  “Yes.”

LILLEY:  “I mean there’s lots of controversy how effective consumer boycotts are.”

DR. LIVINGSTON:  “Right.”

LILLEY:  “I think the consensus seems to be that they’re not very effective.  There’s some phenomenal examples.  But they stand out as times when people put a great deal of effort into something.”

DR. LIVINGSTON:  “M-hm.”

LILLEY:  “But, you know, there’s so questions around the environment and green-washing and people thinking they’re buying something that is environmentally sound.  And, then, just the scale of the problem versus—”

DR. LIVINGSTON:  “Yeah.”

LILLEY:  “—the impact of consumers, it’s hard to imagine that consumers, by themselves—we haven’t seen it around climate change in any big way that this is what it’s gonna take to reverse it.  And, although I think it’s interesting that you focus on the ways that the Left and others have fetishised the workplace as virtuous consumption or not virtuous, but certainly there is something about collective power in these different places, the work place is for one.”

DR. LIVINGSTON:  “Yeah.”

LILLEY:  “And collective power seems to be a key, yet unflagged, element in all of this when we’re talking about redistributing income and all of that.  I mean how do you see that.”

DR. LIVINGSTON:  “Well, I think it’s a very good point that one of the reasons that we have fetishised the workplace is that it is easier to organise people in workplaces than it is to organise consumers.  Consumer boycotts are difficult to accomplish.  But it did get done in the 1950s and 1960s by the Civil Rights Movement.  So, I think we do have historical examples whereby consumer culture can be turned to the benefit of progressive causes.

“I think Michael Pollan has a good answer to your deeper question.  And that is consumers, in the absence of wielding some leverage over producers, like for example, if consumers want better mileage in their cars, well, how do they get that if the producers aren’t—you know—if they think that lower mileage cars are more profitable and, therefore, they’re gonna produce those?

“So, yeah, the question is:  How do you concentrate social power, if you’re talking about consumers?  I think Pollan has a good answer.  And that is:  This food revolution, of which he writes so eloquently, is a way of redescribing and reconstructing a relationship between consumers and producers.  It’s putting them in closer touch and teaching—not to the extent we would like, so far—but teaching producers that it’s to their benefit to produce more healthily, to distribute less expensively, and so on and so forth.

“I think his next book will demonstrate this new relationship between producers and consumers.”

LILLEY:  “But, not just sort of throw around a left-wing sneer—”

DR. LIVINGSTON:  “Right. [chuckles]”

LILLEY:  “—but isn’t a lot of this really about the middle class?  I mean so many Americans now are living on the edge of poverty.”

DR. LIVINGSTON:  “Right.”

LILLEY:  “And they already spend all the money that they have, you know, because they need to to get by.  So, they don’t have discretionary income to say:  Well, I’m gonna put it here or I’m gonna put it there.  So, is this really, in some way, an argument limited to just one portion of society?”

DR. LIVINGSTON:  “I should hope not.  Um, uh, I hope you’re wrong about that because part of the redistribution of income effect, that I argue for in the book is that if we place more income in the hands of people who are now just getting by, who live at or below the poverty line, if we can place more income in their hands, then they will have more choices when it comes to food.  And the boutique stores, you know, the Trader Joe’s, the Whole Foods, all of those places—will move into those poorer neighbourhoods where they can turn a profit, where they can actually market their brand of health food and healthier food for the poorer people as well as the middle class people.

“Paul Campbell’s book on obesity, it seems to me, speaks directly to this, that income redistribution is really the first step towards addressing what he calls the obesity myth.  He doesn’t think it’s an epidemic.  But I guess the rest of us have a little bit more doubt about it.  But income is the key to that.  And, so, without income redistribution, this food revolution, that Pollan describes so well, can’t be completed.”

LILLEY:  “When we think about abundance, shouldn’t we really be thinking about ways to expand public abundance, generally, rather than private abundance?”  (c. 55:10)

DR. LIVINGSTON:  “Yeah.”

LILLEY:  “Although, you’re talking about these policy-wide ways of redistributing income, consumption seems still, by and large, to be a private thing in your book.  Correct me, if I’m wrong.”

DR. LIVINGSTON:  “Well, I think that that’s a fair reading of the book.  But, again, I would hope that one of the policy implications here is that we have to rethink transportation planning priorities, so, that instead of simply giving consumers better choices when it comes to the cars that they buy and commute with, we have to give consumers, commuters, better choices of mass transit.  I don’t think there’s any way around that.  We’re not going to be able to reduce our carbon footprint, as we now see it, in the absence of vaster, greater public spending on public transportation.”

LILLEY:  “James Livingston has been my guest.  He is Professor of History at Rutgers University and the author of Against Thrift: Why Consumer Culture is Good for the Economy, the Environment, and Your Soul.  That’s published by Basic Books.  And you can find a link to it on our website, AgainstTheGrain.org.  James, thank you so much for joining me.”

DR. LIVINGSTON:  “Well, thank you for having me, Sasha.  It was a pleasure.”

[All transcription by Messina]

***

[1]  “Celebrating Consumption“, Against The Grain, May 26, 2015, https://kpfa.org/episode/against-the-grain-may-26-2015/

[2]  N.B.:  Economics is a controversial field of study with contending theories vying for dominance in the academic and popular spheres of influence.  Two of the dominant categories of economic theory (Neoclassical and Keynesian) describe capital as plant and equipment (cf. fixed capital) or financial/money capital (cf. circulating capital).  In both cases, they convey the basic notion of capital, which is of an initial outlay (or investment), which yields a greater return later.  For example, an initial outlay of money capital will generate a greater amount of money later.  This is thought of as using money to make more money.  Or an initial outlay of plant and equipment, will pay for itself and generate greater returns later.  This is thought of as using tools and equipment to make more money.

However, simply thinking of capital as plant and equipment or financial capital obscures the social relations inherent in capitalist social relations.  Another major dominant category of economic theory is Marxian economics.  Marx wrote three important volumes on capital, capitalist relations, and the capitalist mode of production.  Unfortunately, it is largely left out, or censored, from most economics departments.

In the more accurate Marxian sense, capital is a social relation.  It is the constant extraction of surplus value from living labour (as opposed to dead labour, which is embodied in commodities or goods manufactured/produced through the application of living labour).  Workers are exploited through the capitalist mode of production and its wage labour social relations.  Under the capitalist mode of production (as opposed to slavery, feudal or other modes), workers are proletarianised (forced onto the grid, as it were).  Workers are a class of people with nothing of value by which to earn a living other than their capacity to work.  This makes workers dependent upon the asymmetrical power dynamics of the wage-labour social relations, whereby the capitalist owner of the means of production will never hire a worker, unless she can exploit the worker.  That is, unless she can make more money off of the worker than the worker is paid in wages.  By definition, the wage-labour social relation is a predatory one.  This is capital.  It is the theft, or appropriation, of the value produced by labour through society’s deification of property rights and capitalist ownership of the means of production.  Over time, class consciousness has eroded, especially in the USA, such that workers (even in most unions) do not perceive the inherently predatory nature of wage labour or how capital is extracted from labour.

[3]  Dr. L.R. Wray was a student of Dr. Hyman Minsky.  Dr. Wray was also one of my economics professors at the University of Missouri-Kansas City.

[4]  Cf. Turgeon, Lynn (1996). Bastard Keynesianism: The Evolution of Economic Thinking and Policy-Making Since World War II. Praeger. ISBN 978-0313300240.

[5]  Also consider, for example:

[6]  Ibid.

***

[Last modified 04:54 PDT  27 MAY 2015]

Heterodox Economics, Marxian Social Theory, and Capitalist Crisis with Ruchira Sen, Economics/Social Science Consortium

14 Thu May 2015

Posted by in Anti-Capitalism, Anti-Imperialism, Dr. Karl Marx (1818-1883), Free Speech, Marxian Theory (Marxism), Mindfulness, Political Economy

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s200_ruchira.sen
 

LUMPENPROLETARIAT—Ruchira Sen rules.  Despite having an exam and a deadline, and a busy day tomorrow (i.e., 15 MAY 2015), in preparation for going out of state, Ruchira has been gracious enough to, not only, grant Lumpenproletariat.org an interview, but a wonderful late lunch, as well, at Sahara, a cool restaurant across the street from UMKC, for some wonderful Mediterranean food.  “I like your blog,” said Ruchira.  Thanks, I said (totally spazzing out and trying to keep my cool around one of my intellectual sheroes).  I just hope, I said, to comprehend and metabolise your analysis adequately enough to be able to share your ideas and where I disagree/agree with your ideas with our circle of friends (and enemies).

337px-Karl_Marx_001WikiUserI read Ruchira’s 27-page iPh.D. working draft dissertation, Towards a Theory of Imperialism, as well as her 19-page 2013 paper “Marxian Social Theory and Capitalist Crisis” prior to the interview, but that wasn’t nearly enough time for me to fully marinate it all.  So, I apologise in advance for my harried mind.  Even without much time to prepare for the interview, I am grateful to Ruchira Sen for granting it, and for the generosity and wisdom, with which she so graciously graced Lumpenproletariat.org.  We look forward to learning more from her work in future.  (Also, we’ll share with you a transcript of her presentation at UMKC’s 2015 Interdisciplinary Conference (IDC).)

—Messina

***

MESSINA: “This is Messina, for Lumpenproletariat.org.  And, today, I have the great pleasure of speaking with Ruchira Sen.  I’m so excited about this, mostly because Ruchira is, like, one of the warmest people I’ve met at UMKC.  Ruchira, thank you for speaking with [Lumpenproletariat.org].”

RUCHIRA SEN:  “Thanks, Felipe.  And thanks for the nice introduction.”

MESSINA:  “Yeah.  No problem.  I know that it’s crazy busy right now.  And I really appreciate that you’re gonna take some time out from your busy schedule.  And I know you’re working on an exam right now.”

SEN:  “M-hm.”

MESSINA:  “So, I really appreciate this.  And then you’re getting ready to take off tomorrow.  So, I got a chance to read the paper, that you presented at the IDC, the Interdisciplinary Conference, Towards a Theory of Imperialism.  And I also got to read “The Marxian Social Theory and Capitalist Crisis“.  I was really happy to at least read a little bit.

“And I will apologise, right now, in advance, to all of the readers and/or listeners, for my lack of preparation for this interview.  […]  And, even though I’m gonna be completely shooting from the hip here.  [laughs]”

SEN:  [chuckles]

MESSINA:  “Can you start by talking a little bit about your background and your early years, where you grew up?”

SEN:  “Well, my early years are not very exciting.  I was in India.  I grew up in a classic upper-middle class family.  It wasn’t always upper-middle class.  My father worked with the Oil and Natural Gas Corporation because, back then, the public sector in India was what was considered a gem of the—you know—burgeoning, developing economy.  And, at that time, there was an idea that the industrialisation in India would happen through the public sector.  We had the second Five Year Plan with the Mahalanobis model.  And it mostly talked about the rise of the industrial sector.  And how public investment would happen in dams, infrastructure, in oil and natural gas, and steel.

“So, at that time, getting a job in the public sector was something that very few people got.  And my father had one of these very coveted public sector jobs.”

MESSINA:  “Ah, that’s awesome.”

SEN:  “Yeah.  My mother was a doctor with the ONGC.”

MESSINA:  “Whoa.”

SEN:  “So, it was, you know, one of those—they were up-and-coming people.  And they sent me to a very fancy boarding school because that was the up-and-coming thing to do.”

MESSINA:  [laughs]

SEN:  “You know?”

MESSINA:  “That was gonna  be my next question, about your schooling.”

SEN:  “Yeah.”

MESSINA:  “So, you got to go to the nice schools.”

SEN:  “Yeah.  I went to a fancy school.”

MESSINA:  “Unlike, what?  Most people?  Most folks in India?”

SEN:  “Yeah.  It was very rare and very—it was a rare privilege.  And I would say I belonged to the elite educated classes.”

MESSINA:  [laughs]

SEN:  “I can’t really say the ruling class.  But, definitely, as far as, you know, education and, to some extent, I would say this class has a disproportionate share of representation in the decision-making of the nation, in media, in the professional services.”

MESSINA:  “Yeah.  Now, where is this is in India?”

SEN:  “This is in Dehradun.  It’s a valley in the Himalayas, north, way north.  You know where you have, like, right now they talk a lot about the Himalaya—”

MESSINA:  “Yeah.”

SEN:  “—because of this earthquake in Nepal.”

MESSINA:  “M-hm.”

SEN:  “There’s a fault line, that lies out there.  But before you get to Nepal, if you’re going to Nepal from the South, you have the Sivalik Mountains, which are lower and then the Himachal mountains are higher.  So, there are a bunch of valleys there.  And I grew up in one of those valleys.  So, it was a beautiful childhood.  You know?  One of those idyllic times.”

MESSINA:  “Yeah.  [laughs]”

SEN:  “Rhododendron trees, living on a valley on the foothills of—”

MESSINA:  “Yeah.  [laughs]”

SEN:  “—the Himalayas.”

MESSINA:  “Wow!”

SEN:  “Yeah.”

MESSINA:  “That’s awesome.  So, you got to go to nice schools.”

SEN:  “M-hm.”

MESSINA:  “You went to—what?—all the way through college in India?”

SEN:  “Yeah.  I’ve a—So, when I graduated from school, then, after that—you know?—the real world comes and hits you because, suddenly, you realise that you’re in a country with a billion people.  And you have to get a college education.  And it’s almost impossible to get into college because you need over ninety-percent score to be able to get into some of the better colleges.”

MESSINA:  “Wow!”

SEN:  “So, there was this crazy rat race.  One thing is I was extremely nerdy—”

MESSINA:  [laughs]

SEN:  “—and I had the scores.  And I got into a really good college.  So, again, you know, the reality didn’t really hit me because I was so nerdy.  And I had, I mean I don’t agree with this term, social capital—”

MESSINA:  “Yeah.  [laughs]”

SEN:  “—but I belonged to a, you know, a family, which has that privilege of good education and so on.  So, with that baggage, or with that background, I was easily able to get into one of the best colleges.”

MESSINA:  “Wow!”

SEN:  “And—”

MESSINA:  “Which is?  What’s it called.”

SEN:  “St. Stephens College, Delhi.  It’s a missionary college.  It’s affiliated with the Church of North India.  So, yeah, that means I do know a lot more about Christianity than most people from non-Christian households do.”

MESSINA:  “Were you guys Christian?”

SEN:  “No.

MESSINA:  [laughs]

SEN:  “But, you know, the Church in India does a lot of good work with education.”

MESSINA:  “Okay.”

SEN:  “So, they had one of the best—it’s called the Harvard of India, the Ivy League of India.  So, one of the best colleges, St. Stephens.  And it’s supposed to be a great privilege to be there.  And I, somehow, found myself there.

“And, after, once I was there, I started getting disillusioned because it didn’t make sense anymore.  It was all about: Oh, you are in the hallowed halls of Stephania.  You should be able to do this.  And you should be able to do that.  I couldn’t understand what the whole deal is and why that doesn’t make me different from anyone else.  Why do I have to, you know, put in this added effort of maintaining a certain position in the elite class in society?

“And we had to do a Delhi University syllabus.  So, I started getting introduced to Marx.”

MESSINA:  “Hmm.”

SEN:  “I read Sweezy (1942).  I read Theory of Capitalist Production.  And then I read John Gurley, mostly the traditional, historical view of Marx. I thought:  Hmm. This stuff is interesting.  And, somehow, most of the people around me don’t seem to be interested in this type of stuff.  And, somehow, I seem to be interested in it.”

MESSINA:  “Yeah. [inquisitively]”

SEN:  “Is there something wrong with the world?”

MESSINA:  “I know.  Right?”

SEN:  “This little cliquish, niche, world that I live in.”

MESSINA:  “That was my next question.  So, you encounter Marx in your college studies.”

SEN:  “M-hm.”

MESSINA:  “[So, does that change your worldview?]  What led you to start seeing things this way?  Was it your parents?  I mean you were already different.  Right?”

SEN:  “I think I was steadily a bit of a misfit in this, you know, elite society, in which I lived.”

MESSINA:  “Okay.”

SEN:  “So, you know, I still have a lot of very bourgie friends.”

MESSINA:  [laughs]

SEN:  “You know?  And they come over.  And they want to go to the Plaza.  And they want to go shopping.  And I’m stuck following them around and trying to understand what they are talking about.”

MESSINA:  “[Oh, brother.]  You’re not—You’re not feelin’ it, anymore?”

SEN:  “I never did feel it.”

MESSINA:  “You never did feel it! [laughs]”

SEN:  “Yeah.  I think it’s just.  I don’t know what it was.  In India, wherever you are, you are a foreigner.  You know?  I was a Bengali in a Hindi-speaking majority.  I didn’t speak the language.”

MESSINA:  “Ah.”

SEN:  “I didn’t have the same background, as everyone else in my school.  So, I was already a misfit.  My parents were not business class, but professional class.  So, actually, I couldn’t afford—my parents could afford a lot.  But we couldn’t afford what my friends thought was cool.  You know?  Little Mermaid shampoo bottle.”

MESSINA:  [laughs]

SEN:  “I mean, you know, Gap is supposed to not be a great brand here.”

MESSINA:  “Yeah.”

SEN:  “But, in India, it’s so cool.  And McDonald’s, where everybody eats here, in India, that’s where people go on dates.

“So, and I think Bengalis, as such, have a cultural background of not liking money.  You know?  It’s just cultural.  I don’t know where it comes from.”

MESSINA:  “Ohh.  Okay.”

SEN:  “So, if I wanted to be like my friends, and if I wanted the Little Mermaid shampoo and the fancy stationary boxes and the Nike shoes—Nike is a big deal in India.  I know you are laughing.  But Nike is a big deal in India.”

MESSINA:  “No; yeah.”

SEN:  “It’s what the elite people wear.  [laughs]

MESSINA:  “Yeah.”

SEN:  “So, I never had Nike shoes.  I had Action shoes, bought in the cheap store.  And people would make fun me saying:  Oh, why do you have such cheap shoes?”

MESSINA:  “I can relate.  It’s kind of similar.  My parents came from Mexico.  They never even went to first grade.  But they worked so hard for us to have what everybody else had.  And I went to a basically preppy school.”

SEN:  “M-hm.”

MESSINA:  “[…]  And yeah, I would wanna dress like the preppies.  And have all those kind of fancy stuff.  But I don’t know what kind of led me to reject that.  Maybe it was being broke.  But I’m glad that you did.”

SEN:  “I wouldn’t say I rejected that because I wasn’t strong enough to do that.  I was just dealing with the bullies because I was nerdy.  And nerdy people get bullied.  So, I was trying to deal with a lot of mean girls.  You know that classic movie?  Mean Girls.  It was like that.  And they would come and throw water on my bed.”

MESSINA:  “Wow! That’s horrible.”

SEN:  “They knew I cared a lot about my books, so [laughs] they would do all kinds of crazy stuff.  They would take my books and dump them in buckets of water, so that I would see my books destroyed.”

MESSINA:  “That’s terrible.  […]”

“Like I said I was really stoked about the IDC presentation because you were talking about imperialism.  So, I’m just gonna kind of jump around.  […] We had to write a paper.  And I’m like well, what should I write about?  Well, the first thing that comes to my mind is imperialism.

“And I thought the same thing.  Like, what happened to imperialism.  Nobody talks about imperialism anymore.  I guess imperialism’s over.  I had vaguely heard about Immanuel Wallerstein and his world-systems approach, and a center-periphery stuff I’d heard about.

“But I would hear from activists on the street.  They still talk about imperialism.  And, maybe, I thought, maybe they’re kind of outdated.  Maybe they’ve got it wrong.  Maybe things have changed and moved on.  So, I decided to learn more about it by writing about it.  […]

“Would you mind going over a bit of a review of your presentation for everyone who has not caught your presentation?”

SEN:  “Well, I think, so far, that the West does not really have an understanding of imperialism.  For instance, I’ve been speaking to some Marxian scholars here.  Their idea becomes of imperialism as aggression, as militarism—”

MESSINA:  “M-hm.”

SEN:  “—of countries taking over other countries.  And I mean countries taking over other countries is not new.  It’s not something that is necessary and sufficient just to capitalism.  It predates capitalism.  In Veblen, we read that wonderful essay of his, ‘The Barbarian Status of Women.’

“We heard about, since the time, there has been the emergence of surplus, you know, various human societies have tried to take over other human societies and enslave the people, make them the lower caste of production, take the women over as trophies.  You know?  That’s where marriage comes from.”

MESSINA:  “Yeah.”

SEN:  “That stuff is there.  And maybe you can think of that, as imperialism.  But that’s not modern imperialism.”

MESSINA:  “No.”

[SNIP]

[This is a rush transcript.  This transcript is currently under construction.]

[SNIP]

MESSINA:  “(c. 57:50)  Well, I’m lookin’ at your paper.  And Marx talked about some of that stuff.  So, what I’m getting at is:  There’s so much influence, what seems to be Marx influence—”

SEN:  “M-hm.”

MESSINA:  “—in Veblen—”

SEN:  “I think that.”

MESSINA:  “—in Keynes—”

SEN:  “Yeah.”

MESSINA:  “—in, like, everywhere.  Right?”

SEN:  “Yeah.  I mean, I’m glad Americans read Veblen.”

MESSINA:  “It seems dishonest, intellectually dishonest.  I don’t know.”

SEN:  “I’m glad Americans read Veblen—”

MESSINA:  “Yeah!  [laughs]”

SEN:  “—because, well, if they don’t read Marx, at least they read Veblen.”

MESSINA:  “Yeah.  You know?”

SEN:  “And Veblen is great in his own way.  I like his idea of capital, as intangible assets, as opposed to produced means of production.  I mean he obscures the social relations, but—”

MESSINA:  “He seems to have read Marx, and then done something else with it, and then not mention Marx.”

SEN:  “No, Veblen has this annoying tendency.  He doesn’t cite any of his sources.”

MESSINA:  “Is that, kind of, like, a fair assessment of Veblen?

SEN:  “I think that is.  But you know Veblen never cites any of his sources.”

MESSINA:  “Yeah.”

SEN:  “Maybe it was not the academic thing to do back then.  You know?  He’s so influenced by Darwin.  I haven’t seen a single Darwin reference in any of his work.”

MESSINA:  “Yeah.”

SEN:  “So, Veblen clearly read Marx.”

MESSINA:  [laughs]

SEN:  “And he clearly read Darwin.  And he was a very well-read person.”

MESSINA:  “Yeah!  In Dr. Sturgeon’s Institutional Economics class, I always kept bringing up Marx because it screams out at you everywhere.  You know?”

SEN:  “Oh, he doesn’t like that.”

MESSINA:  “Yeah!  And he was–I think he was quite respectful, to me, because, I don’t know, I [wasn’t rude about it.  He is very cool].  But he talked about capital.  And that’s another question I was going to ask you was how he disagreed with Marx’s definition of capital because he said Marx’s definition implies some sort of natural rights.  And I think you say in your paper the exact opposite.”

SEN:  “What do I say?  What rights?”

MESSINA:  “Well, I mean—”

SEN:  “I do talk about a rights-based approach a little.  You know?  A right to employment, a right to food, and so on.  That’s my ways of development under imperialism.”

MESSINA:  “Are you familiar with that Original Institutional definition of capital and their complaint against Marx?”

SEN;  “Which is that?  No, not really.”

MESSINA:  “No?  Oh, okay? [laughs]”  (c. 1:00:00)

SEN:  “Could you tell me about it?”

MESSINA:  “I don’t think I can, unfortunately.  [reaching for notebook]  He discredited Marx’s definition of capital because he says that it relies on [shuffling through notebook], he said—”  [1]

SEN:  “He said it’s too physical.  Right?  Nature of Capital.  [reading my notebook]  I’ve read that book.”

MESSINA:  “He’s saying:  Veblen finds Marx’s definition too limiting.  It implies natural rights of the capital holder.”

SEN:  “Ohh.”

MESSINA:  “Or something like that.  That it’s a natural rights argument.”

SEN:  “Interesting.”

MESSINA:  “And I’m thinking:  No.”

SEN:  “I read that paper.  I didn’t really see this there.  What I got from it:  I thought it was more than just about the means of production because he starts talking about intangible assets, like goodwill and, you know.  It goes beyond actual, physical stuff.”

MESSINA:  “Yeah.”  (c. 1:00:58)

SEN:  “It goes beyond the whole commodity approach of classical political economy.”

MESSINA:  “Yeah, which I think is cool.  You know—”

SEN:  “Which I think is cool.”

MESSINA:  “—he injected some cool stuff into, you know, into Marx.”

SEN:  “M-hm.”

MESSINA:  “I just wish that Veblen would have said: Yeah, I’m building on Marx. [chuckles]  You know?”

SEN:  “Yeah.”

MESSINA:  “I mean, the Original Institutionalists talk about the cumulative accumulation of the common stock of knowledge and so forth—”

SEN:  “Yeah.”

MESSINA:  “—and somehow they still refuse to acknowledge the obvious influence of Marx, the Marxian influence.  [laughs]”

SEN:  “Yeah.  But, you know?  I think it’s also the old way of reading Marx, a tendency to read Marx in a world of commodities and not looking at the fact that capital is a relationship.  It’s not a thing.  They sort of see it as a thing.”

MESSINA:  “Yeah!  What is that a reification?  They reify it?”

SEN:  “Yeah.  And they don’t see that capital–I mean, they think that they are building and creating something new by talking about goodwill and intangible assets.  And my relationship with you is, certainly, capital.  And a lot of our colleagues also, you know, do this in the Institutionalist approach, like Jonathan Ramse’s paper on capital, the seven capitals, where he’s trying to marry the sociological and economic definitions of capital.

“He’s also relying on that!  He’s saying that a social relationship can be capital.”

MESSINA:  “Yeah.”

SEN:  “Yes, I agree.  A social relationship can be capital.  That is not a rejection of Marx!”

MESSINA:  “No!  U-uh.”

SEN:  “They see it as a rejection of Marx because they have understood Marx in a very limited way.”

MESSINA:  “Yeah.  I mean, you know, I always point people to Dr. Richard Wolff—”

SEN:  “M-hm.”

MESSINA:  “—who does his weekly radio broadcasts.  And, you know—”

SEN:  “M-hm.”

MESSINA:  “—and he points out, all the time, to the public, you know.  The capitalist would never hire you, unless the capitalist can make more money off of you than he’s gonna pay you.”

SEN:  “Yeah!”

MESSINA:  “You know?  It’s—from the beginning—a predatory and exploitative relationship.”

SEN:  “Exactly!”

MESSINA:  “Ruchira Sen—”

SEN:  “M-hm.”

MESSINA:  “—thank you very much for speaking with Lumpenproletariat.org.”

SEN:  [smiles]

***

[1]  Upon closer inspection of my lecture notes (ECON 451: Institutional Economic Theory, Fall 2014):

Dr. Sturgeon was discussing the factors of production, as described in economic theory.  The most problematic one, he said, was capital, because

“it is frequently confused or confusing what it is we’re talking about.  Are we talkin’ about plant and equipment?  The industrial arts?  What Veblen, would later call, Industrial Capital.  Or are we talking about money?  The pecuniary arts?  What Veblen would later call the pecuniary capital?

“Or are we talking about something entirely different from both of those things?  Are we talking about the process of the development of the joint stock of knowledge, upon which we all draw when we do something?  So-called social capital.”

So, Dr. Sturgeon recommended Veblen’s “wonderful, two-part article”, entitled “On the Nature of Capital” (1908, Quarterly Journal of Economics).  I was impressed to hear of this article by Veblen because I always thought he was greatly influenced by Marx.  I thought this would be where Marx would be cited and further vindicated.  But, instead, Dr. Sturgeon, rather than point out Marxian influence in Veblen’s definition of capital, said Veblen built on Veblen’s prior work, Theory of the Business Enterprise.  “Veblen would have us completely abandon the old notions of capital.”  Yes, but, perhaps, Veblen would only do so after working through the literature, including Marx.

So, I asked Dr. Sturgeon, during the lecture:  “He would have us abandon Marx’s definition of capital, for example?”

“Most definitely,” he said.

“So, it’s not the extraction of surplus value?” I queried.

No, he nodded his head, “because that is culturally limited to those who think that somebody has a natural right to something.”

“Hm?” I thought, right flummoxed.

“A natural rights doctrine is a culturally-set doctrine,” he continued.  The room was silent.  So, my colleague Evan Payne quizzed:  “So, is Veblen’s notion of capital, closer to [Pierre] Bourdieu?”  “Or the other way around,” concurred Dr. Sturgeon, “Yes.”

He recommended, for a deeper look at this issue, that we students look at, or revisit, the Cambridge Capital Controversy, or, more precisely, the Cambridge Controversy on the Theory of Capital.”  He explained how academics were trying to get at the nature of capital, but, ultimately, ending in a stalemate.  What seemed grossly lacking to me in all of this, as Dr. Richard Wolff often points out, is how there’s no mention of those epic tomes on capital written by Marx. It seems like such a huge oversight.  As Dr. Richard Wolff pointed out in one iteration on Democracy Now!:

“I was always struck that as I went through these schools, studying history, politics, economics, sociology—the things that intrigued me—I was never required to read one word of Karl Marx. And I remember telling that to my father, who looked in stunned disbelief at the very possibility that an educated person going to such august universities would not be required to at least read people who are critical of the society, simply as a notion of proper education. So with a father like that, it wasn’t so surprising that I went and found ways that individuals who were on the faculty sometime could, out of the classroom, teach me, take me through the great classics of critical literature, whether it was Marx and Engels themselves or Antonio Gramsci or George Lukács or all of the other—Rosa Luxemburg, the great thinkers of the critical perspective. So, I got excited about learning that on my own.

“Then I discovered that these people are full of interesting insights about our society, and I should have been asked to read them. And the more I read it, the more I realized that I wanted to be an economist, but one who had a toolbox not only with the conventional stuff that I was learning in my university classes, but also with the nonconventional stuff. And, you know, over the last 40 years in America, it’s a sort of a sad comment, but if you’re interested in Marxism, then people look at you as if you either are a Marxist, or worse, some sort of caricature of a Marxist. So I always have said I use Marxist theory, I find it very insightful, I think it’s a shame that other people don’t have it, and I think it’s made me a better economist when it comes to writing and teaching than I would have been without that. And I think that would be the same for my colleagues, and that it’s a deficiency of theirs that the education didn’t do it.”

However, Dr. Sturgeon said, “perhaps, the most illuminating comment was made by Joan Robinson, who said: If I had it to do over again, I’d have started the controversy out of Veblen’s work. (i.e., ‘On the Nature of Capital‘)”

Dr. Sturgeon stressed taxonomy: What is capital?  He also emphasised the importance of definitions needing to be evolutionary, otherwise, eventually, as society evolves, the definitions will no longer square with reality.

***

[Last modified 15:27 CDT 15 MAY 2015]

[Image entitled “Karl Marx 001” by John Jabez Edwin Mayall – International Institute of Social History in Amsterdam, Netherlands. Licensed under Public Domain via Wikimedia Commons.]