Compulsive Behavior

Compulsive Behavior

by Sabine Nuss

Originally published in German in the daily newspaper neues deutschland

The Deutsche Theater in Berlin recently celebrated the premiere of the play “Das Himbeerreich” (“The Raspberry Empire”). Director Andres Veiel interviewed over twenty prominent bankers in order to trace “the connecting threads between personal motives and social structures in the financial sector.” That’s a rare concern at a time in which the crisis is often reduced to the greed of managers and thus to individual bad behavior.

Admittedly, it’s easier to criticize people than “structures” or an abstract “system”. People have faces and addresses, they bear responsibility, fulfill tasks, and act. Structures, on the other hand; where are they tangible? Marx made social structures the point of departure for his analysis, which in turn explained individual behavior. According to him, it’s competition that forces the individual capitalist, by pain of ruin, to make the hunt for constantly increasing surplus-value the purpose of his activity.

With regard to the financial sector, it was this competition that was desired by the state in the recent past. For that reason, there were regulations intended to promote competition. These laws, referred to as “deregulation” arose, once again, from the pressures of competition: states vied with each other for the position of “attractive investment location for capital.”

So how’s the situation with regard to competition and individual behavior? Ultimately, social structures are nothing more than the result of millions of individual acts by millions of people equpped with different levels of power. For that reason, structures cannot easily be traced back to individual, exposed protagonists. We are all in competition with each other every day: when seeking work, when we try to sell our labor power in the most optimal way, so that we get the job and not others. In the workplace, if I work harder than others so that the next wave of dismissals won’t affect me. As a business person, if I try to sell more commodities than others. By constantly performing these everyday actions, we constantly reproduce the structure that distresses us, and from which none of us can extricate ourselves, unless one already has enough money to live. This is not to excuse excesses by bankers, or lousy character traits. However, the point is to reveal the contradiction that permeates everything under the reigning social conditions.

Veiel has depicted that in his play: the bankers stand around forlorn in a large space. They are victims. On the other hand, they created these spaces themselves. “It’s their empire, they bear the responsibility, even if they suffer from an inherent contradiction” says the director. A solution to the crisis inspired by the left must therefore place a new architecture of “the system” on the agenda – not just with regard to the financial sector and the activity of the state. Rolling back competition in favor of cooperation can be practiced at many levels. Self-managed housing projects, worker-owned businesses, or agricultural collectives are just a few examples. In a capitalist environment, they often fail, have to be maintained with great effort, and are always precarious and subject to ridicule. But they are the fragments of a space in which people would perhaps behave differently, because they are able to, and don’t have to fight with each other for raspberries.

Critical Notes on Moishe Postone

Just as a heads up, the blog Reification of Persons and Personification of Things has published a series of critical observations on Moishe Postone that are very worth reading.

Part 1,Part 2,,Part 3,Part 4,Part 5,Part 5a,Part 6,Part 7,Part 8,Part 9, and Conclusion.

I just finished TLSD. As you’ve probably noticed I had my problems with it. I don’t want to go over them in detail again as they are available elsewhere on this blog. Instead I want to focus on two points: how the context of TLSD publication and Postone’s argumentative strategy make it seem more singular than it deserves and how money may have addressed what I saw as the gap in Postone’s analysis between structure, action, valorization and reproduction.

Regarding the first point as I signaled in my first post on re-reading TLSD, Postone’s work is not as singular as it presents itself. This is certainly true of the main points that he makes in his reinterpretation of the central categories in part one of Capital. What I rate as better analyses of these categories were already available in English in the works of Rubin and essays by Arthur, Backhaus, Reichelt, Open Marxism, Banaji etc. In addition there was 20 odd year of German scholarship to say nothing of Japanese value theory. All of this is obscured by Postone’s strategy of separating himself from all heretofore existing ‘traditional Marixsts.’

Engels on the American Political System

There is no place yet in America for a third party, I believe. The divergence of interests even in the same class group is so great in that tremendous area that wholly different groups and interests are represented in each of the two big parties, depending on the locality, and almost each particular section of the possessing class has its representatives in each of the two parties to a very large degree, though today big industry forms the core of the Republicans on the whole, just as the big landowners of the South form that of the Democrats. The apparent haphazardness of this jumbling together is what provides the splendid soil for the corruption and the plundering of the government that flourish there so beautifully. Only when the land — the public lands — is completely in the hands of the speculators, and settlement on the land thus becomes more and more difficult or falls prey to gouging — only then, I think, will the time come, with peaceful development, for a third party. Land is the basis of speculation, and the American speculative mania and speculative opportunity are the chief levers that hold the native-born worker in bondage to the bourgeoisie. Only when there is a generation of native-born workers that cannot expect anything from speculation any more will we have a solid foothold in America. But, of course, who can count on peaceful development in America! There are economic jumps over there, like the political ones in France — to be sure, they produce the same momentary retrogressions.

The small farmer and the petty bourgeois will hardly ever succeed in forming a strong party; they consist of elements that change too rapidly — the farmer is often a migratory farmer, farming two, three, and four farms in succession in different states and territories, immigration and bankruptcy promote the change in personnel, and economic dependence upon the creditor also hampers independence — but to make up for it they are a splendid element for politicians, who speculate on their discontent in order to sell them out to one of the big parties afterward.

The tenacity of the Yankees, who are even rehashing the Greenback humbug, is a result of their theoretical backwardness and their Anglo-Saxon contempt for all theory. They are punished for this by a superstitious belief in every philosophical and economic absurdity, by religious sectarianism, and by idiotic economic experiments, out of which, however, certain bourgeois cliques profit.

(Hat-tip to Doug Henwood)

Ingo Stützle on David Graeber, Part 2

Available here.

Michael Heinrich – The Development of Marx’s Theory of Value, and its Ambivalences (English)

Why You Need Yet Another Introduction to Capital

The blog “Reification of Persons and Personification of Things” gives a nice endorsement of the Heinrich Capital Introduction (at the end of a critique of David Harvey’s):

As a result, Harvey’s stated attempt to provide a close reading that reads Capital in ‘Marx’s own terms’ ultimately fails. Fortunately, the recently published Heinrich introduction does address these issues. It is also properly lucid and cogent providing an overview of all three volumes of Capital in half of the space it takes Harvey to give an overview of volume 1. If I had my say it would become the go to guide not only for people who are trying to understand Capital, but for a number of people who think they already understand Capital.

New Release: An Introduction to the Three Volumes of Karl Marx’s Capital

Now available from Monthly Review Press!

I hear from many people who’d love to read Capital, but find the thing almost prohibitively daunting. Michael Heinrich has written an excellent little introduction to Marx’s masterpiece. Among its many virtues is that it takes money and finance seriously, which many Marxists don’t. But even if you’ve read lots of Marx, you can still learn a lot by reading this book.

—Doug Henwood, editor, Left Business Observer

Whether one is a ‘traditional world-view Marxist’ like myself, or a student who wants to understand this world we live in, or an activist who is committed to changing it, Michael Heinrich’s succinct, lucid, compelling summary of the three volumes of Marx’s Capital is a ‘must-read’ in our time of crisis.

—Paul LeBlanc, professor of history, La Roche College; author, From Marx to Gramsci and Marx, Lenin and the Revolutionary Experience

The best introduction to Capital I have read. Heinrich has done the world of Marx scholarship a great service. In presenting Marx’s critique of the entire structure of capitalism, Heinrich manages to be comprehensive, deep, and clear at the same time. While making a substantial advance in analyzing Marx, he makes this book accessible to readers who are relatively unfamiliar with Marx.

—Michael Perelman, professor of economics, California State University, Chico; author, The Invisible Handcuffs of Capitalism and The Confiscation of American Prosperity

A brilliant presentation of Marx’s Capital—it would be hard to imagine a more timely publication. Anyone who thought Marx was irrelevant to today’s movement needs only to read this book to see things differently. Whether people describe themselves as anarchists or socialists, all of us can benefit from understanding what Marx actually wrote. Must reading for everyone in the Occupy movement and for everyone who wants to understand social relations in contemporary capitalist societies.

—Paddy Quick, member, Union for Radical Political Economics;
St. Francis College

This is likely the best short introduction to Marx’s Capital to ever appear in English. Michael Heinrich succeeds in providing the readers with a clear and profound understanding of the core of the Marxian critique of political economy, thanks to his deep knowledge of the critical edition of Marx and Engels’s collected writings and of the German debate.

—Riccardo Bellofiore, professor of monetary economics and history of economic thought, University of Bergamo, Italy; co-editor, Re-Reading Marx: New Perspectives after the Critical Edition

A fundamental reinterpretation and understanding of all major ‘chapters’ of Marx’s theory, many of which which remain until now a matter of different interpretations or even dispute among Marxist and Non-Marxist economists and, more generally, social scientists: value theory, money and the credit system, the ‘falling rate of profit,’ economic cycles and crises, and the circuit of social capital … an important book for all those seeking to comprehend the workings of capitalism, but also for the university library and the students’ or scholars’ study of Marx’s theory.

—John Milios, professor of economics, National Technical University of Athens, Greece

The best and most comprehensive introduction to Marx’s Capital there is. It is written in a most accessible style and provides an admirably clear explanation of complex ideas. In contrast to other Introductions to Marx’s Capital, it offers a sophisticated commentary on all three volumes of Capital, provides an excellent critical commentary on the secondary literature, and includes pertinent case studies to illustrate the contemporary relevance of Capital, including an excursus on anti-Semitism, globalization, and imperialism. Its scholarly treatment of Capital is at once accessible, comprehensive and contemporary. I do not know of any better introduction to Capital for undergraduate students and non-specialist readers.

—Werner Bonefeld, Department of Politics, University of York

In only 220 pages the author achieves a summary of the three volumes of Capital: explaining the connection between labor, commodities, and money, how surplus value arises, what capital is, the role of banks and stock exchanges, and from where crises arise. Alongside this he manages to fit in the history of Marxism, demystify the ambiguous term dialectic, and throw in a final chapter on the role of the state in capitalism, all the while refuting common mistakes about the Marxian corpus.

—Stephan Kaufmann, Berliner Zeitung

Debt and Punishment: A Critical Review of David Graeber’s Debt

Debt and Punishment

David Graeber’s book Debt: The First 5,000 Years is missing an analysis of capitalism

by Ingo Stützle

(article originally published in the May 18th, 2012 issue of the newspaper analyse & kritik)

The last few years of crisis politics were a prime example of how on the one hand profits are privatized, while on the other hand losses are socialized. The deep crisis of capitalism has left in its wake a sovereign debt crisis. The answer of the political class has been fiscal consolidation. Finance capital’s claims on returns are guaranteed and collected by the state. The invisible hand of the market is joined by the visible fist of the state. Struggles over state finances will be central battlefields in the next few years.

That is no doubt the reason why the publication of David Graeber’s book Debt: The First 5,000 Years was greeted with euphoria, even by the bourgeois press. In the Frankfurter Allgemeine Sonntagszeitung, Frank Schirrmacher wrote that Graeber “opens the reader’s eyes to what’s going on right now,” and furthermore, “Graeber’s text is a revelation, since one is no longer forced to react to the system itself within the system of apparent economic rationality.” Der Spiegel opines: “his book on the nature of debt and its economic and moral basis is already regarded as an anti-capitalist standard work of the new social movements which have emerged during the world economic crisis.” This is in reference to the Occupy protests. Even the chief economist of the Deutsche Bank group reviewed Graber’s book positively in the monthly economic policy journal Wirtschaftsdienst (4/2012) with regard to the question of the future of central banking. Since May 2012, the book has been available in a German edition.

Promises Become Debts

David Graeber, anthropologist and anarchist, is a Professor at Goldsmiths College of the University of London. Until 2007, he taught Ethnology at the ivy league university Yale. For political reasons, his contract was not renewed – Graeber is a political activist. Since the protests against the World Economic Forum in New York City in 2002, he has been an important figure. The role that he has played in the Occupy movement underscores this: not only has he participated, but he has published books on the movement.

Graeber’s point of departure is the question as to why in capitalism the human appreciation of morality and justice is reduced to an economic quantity and the language of a business transaction – debt. The moral-economic double meaning of the word “debt” in many languages is striking. How have moral obligations and promises between people become an economic debt, and what does that mean for society?

For Graeber, debts constitute a promise – which is to say, a moral obligation – which also existed before capitalism and independent of money. Money makes the mutual promise between people into something impersonal and transferable: debt. Human cooperation, community, and possible forms of renegotiating promises are thus disturbed, existing relations of power and domination become cemented.

In this way, money makes it possible to “turn morality into a matter of impersonal arithmetic” with which promises can be balanced against each other. A settlement by means of debt cancellation, renegotiation, or non-commodified exchange relationships (gift giving or donation), as was still prevalent in pre-capitalist societies, is thus no longer possible.

Graeber thus concentrates upon a classical question of political economy, with which the book also begins: what is money? In the first part, Graeber correctly criticizes the theoretical mainstream of economics. Economics textbooks always begin with barter, an exchange of products without the mediation of money. Economists usually proceed from unhistorical models in which people pursue their “natural dispositions”, among others their drive to barter and exchange.

The State Invents Money

Graeber opposes all this with a historical argument. He proceeds from the assumption that credit and therefore the relationship between creditor and debtor historically precedes money. “The standard account of monetary history is precisely backwards”, namely the sequence from exchange to the discovery of money to the developed credit system. Graeber further hones his argument: money is not only a thing, but a means of making things commensurable. But exactly what is measured or compared? Graeber’s simple answer is: debt. Money and credit (that is to say, promises to pay) are for him de facto the same.

Graeber reconstructs the genesis of money from promises through various historical phases. From the time of early urban civilizations (Egypt, Mesopotamia, China) around 3000 to 800 B.C., through the Middle Ages (600-1450 A.D.) to the “Age of Great Capitalist Empires” from 1450 (to 1971).

In Graeber’s account, the state is responsible for the emergence of money, which was introduced in order to pay soldiers. The state thus at the same time also establishes the “currency” in which it collects taxes and generalizes the use of money. Simultaneously, markets arise alongside barracks and mass war production, and in turn money plays an increasingly important role in these markets. According to Graeber, state force, money/credit, and the dominance of markets are tightly interwoven.

Graeber’s account exhibits a rather vague understanding of capitalism, and in accordance with the anarchist tradition assigns a dominant role to the state. At the same time, this role is subordinated to the economy of obligation. The same is the case for other characteristics of capitalism. Monetary phenomena have existed long before factories and wage labor. However, one searches in vain in Graeber’s work for an exact determination of what capitalism is. One characteristic he offers is endless growth and the production of “an endlessly expanding volume of material goods”. Also central is the state’s promotion of an “economy of interest”; the history of capitalism is the history of “the gradual transformation of moral networks by the intrusion of the impersonal – and often vindictive – power of the state.” Against this background, it’s no wonder that Graeber concludes that markets and money will continue to exist after capitalism.

It’s not difficult to recognize that Graeber’s understanding of capitalism is not oriented toward Marx’s. However, whoever struggles against capitalist relations should nonetheless have an idea of what it is he or she is against. In the future, this must be a concern within the radical left. It is at this point that a critique of Graeber’s book should be applied.

Relations Without Classes

In principle, Graeber proceeds from the starting point of a socioeconomic relationship that generates interest – the relationship between creditor and debtor; but class relations, the relation between wage labor and capital, and the form of production are not at the center of his focus. Thus, numerous relationships that characterize capitalism become indistinct in Graeber’s account.

Various actors engage in credit relationships. Debtors can be states, wage laborers, or businesses – for different reasons. The state, because it does not collect enough revenue from taxes or because it nationalizes bank losses; wage laborers, because they don’t earn enough; businesses, in order to make as much profit as possible. The perspective of credit, however, causes them to all look the same; the reason for the credit relationship that arises appears irrelevant.

This blurring of social relations is also apparent in the categories of money, credit, and capital, which in Graeber’s conception are indistinguishable from one another. According to Marx, on the other hand, they are forms that mediate quite distinct relations. Money completes a promise to pay, it is therefore itself the “general equivalent.” Money is accepted and used by all, whether wage laborer or capitalist. It mediates commodity exchange. Labor-power is also compensated in the form of money.

If money is supposed to be credit, as Graeber thinks, that raises the question as to what “real” act of monetary payment it supposedly refers. Capital is valorized value. When money is spent as capital, it always presupposes a class relation. Money is spent with the goal of making a profit. At the same time, this relation presupposes the existence of people who, free of both means of production and of personal ties of dependency, have nothing to sell but their labor-power. When capital takes the form of a property claim such as a stock, bond, or another security, Marx refers to it as “fictitious capital”. For Graeber, it’s again merely credit. Since he ascribes no relevance to these distinctions, all cats are grey to him.

Cancel All Debt

The same is true for his historical observations. Graeber does not recognize what money and credit mean in pre-capitalist societies, what distinguishes them from each other. He works with trans-historical phenomena, without raising questions as to their historical-social form. This is a trait he shares with the economic mainstream that he otherwise criticizes. Graeber writes that systems of credit and accounting are as old as civilization itself. He admits that he finds it difficult to distinguish between gift-giving and credit; but this is only a problem if one discusses these forms of social intercourse independent of their respective dominant forms of production, when one does not clarify exactly what is characteristic of capitalism, what makes it capitalistic and thus what distinguishes it from other social formations.

Historically speaking, a social obligation is not the same thing as credit, and even credit is not the same thing as credit. This observation can be found in Marx’s work: “There was borrowing and lending in earlier situations as well, and usury is even the oldest of the antediluvian forms of capital. But borrowing and lending no more constitute credit than working constitutes industrial labour or free wage labour.” (Grundrisse, <http://www.marxists.org/archive/marx/works/1857/grundrisse/ch10.htm) What does Marx mean by that? Under pre-capitalist relations, in which production was conducted to meet needs, credit was a means of impoverishment. In contrast, under capitalism, credit is a means of augmenting money – of profit maximization. Similarly, industrial labor (or factories in the case of Graeber's book) cannot be simply identified with capitalist profit logic.

Although it is often asserted that a historical approach is able to show that something existed before capitalism, and that one can learn from history, the differences between capitalist and pre-capitalist societies are often obliterated (and not just in Graeber's book) if one does not first clarify what is specific about capitalism, in order to use that as the starting point for delving into history – and not the other way around. 1

According to Graeber, every revolution begins with debt that society can no longer repay. “Cancel the debts and redistribute the land.” This sentence by the historian of antiquity Moses Finley is the only revolutionary program, recurring throughout the centuries. And most revolutions were preceded by (excessive) debt. However, before we can think about revolution, we should agree first on what exactly is supposed to be revolutionized. Debt cancellation is indeed a correct demand, but only when the social relations that constantly bring about indebtedness are abolished as well. It seems difficult to reach an agreement with Graeber on exactly what those social relations are.

  1. For that reason, historical research influenced by Marx controverts Graeber's accounts of the market, credit, and money. On the imposition of the market as an imperative, see Ellen Meiksins Wood's The Origin of Capitalism. On money, see Jacques LeGoff ‘s Your Money or Your Life: Economy and Religion in the Middle Ages. On credit, see Karl Polanyi’s Primitive, Archaic, and Modern Economies: Essays. []

Event Note

(Thanks to reificationofpersonsandpersonificationofthings.)

The Department of Sociology, Goldsmiths, University of London invites you to:

Value, Money and Crisis:
A Workshop on the Work of Hans-Georg Backhaus

Presentations by Riccardo Bellofiore and Tommaso Redolfi Riva, responses by Chris Arthur and Werner Bonefeld

4 June 2012
Room 137, Richard Hoggart Building, Goldsmiths, University of London
4-6 pm
All welcome

Hans-Georg Backhaus is one of the most provocative thinkers of the Frankfurt School. Together with Helmut Reichelt, Alfred Schmidt, and Hans-Jürgen Krahl, he was at the origin of the Neue Marx-Lektüre. Building on Adorno’s critical sociology, Backhaus has been engaged in a problematization of the Marxian critique of political economy which takes seriously its roots in Hegel’s Logic. Questioning orthodox Marxism and Engels’s legacy, he has advanced a whole-scale reconstruction of Marxian theory, confronting the inconsistencies in Das Kapital, and rescuing Marxism as a critical theory of society. The most important of his essays were collected in Dialektik der Wertform: Untersuchungen zur marxschen Okonomiekritik (The Dialectic of the Value Form: Investigations into Marx’s Critique of Economics) by the German publisher ça ira. Very few of them are available in English, but the seminal contributions (in particular his 4-part Materials for the Reconstruction of Marx’s Theory of Value) have now been published in Italian under the editorship of Bellofiore and Redolfi Riva. At the core of Backhaus’s reconstructive project is the uniqueness of Marx in building the only monetary theory of value available to us, together with a full recognition of the fetish character and the displaced/perverted nature of contradictory capitalist reality. Backhaus’s contributions put the question of the ‘constitution’ of capitalist social ‘objectivity’ once again on the agenda of Marxian theory and politics. They are essential today for anyone preoccupied with building an analysis of the crisis – one that would not only depart radically from mainstream economic theory, but go far deeper than Neo-Ricardianism and Keynesianism.

Riccardo Bellofiore has published books on Marx, Luxemburg, Minsky, Napoleoni, globalization, and the current economic crisis. With Giovanna Vertova he has a FB page, Economisti di classe. He teaches at the University of Bergamo, Italy.

Tommaso Redolfi Riva studied Philosophy and History of Political Economy in the Universities of Pisa and Florence. Together with Riccardo Bellofiore he is the editor of Hans Georg Backhaus, Dialettica della forma di valore, Roma, 2009.

Chris Arthur is the author of The New Dialectic and Marx’s Capital.

Werner Bonefeld teaches at the University of York. He recently edited Subverting the Present, Imagining the Future: Insurrection, Movement, Commons.

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