19.6.10

SHORTER MARXIST BUSINESS CYCLE. The General Law of Capitalist Accumulation, as spelled out in volume I of Capital, culminates thus:
Along with the constantly diminishing number of the magnates of capital, who usurp and monopolize all advantages of this process of transformation, grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working-class, a class always increasing in numbers, and disciplined, united, organized by the very mechanism of the process of capitalist production itself, The monopoly of capital becomes a fetter upon the mode of production. Centralization of the means of production and socialization of labor at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.
It takes 21 chapters to get there, and a lot of heavy reading, whether in German, Russian, or in the English translation.

Read through Howard Sherman's The Roller Coaster Economy: Financial Crisis, Great Recession, and the Public Option, and you get the same analysis, albeit in fewer pages and with a different policy conclusion. Thus Book Review No. 12 recommends the book as an accessible explanation of the Marxian business cycle. The serious scholar will still read and understand all three volumes of Capital: the casually interested reader will find the main points spelled out in chapter 1, Boom, Bust, and Misery; and in Chapter 2, History of the Roller Coaster. Keep reading, and note the labor theory of value, the accumulation of surplus value, and underconsumption.

The public policy chapter that concludes the book, however, does not call for goatees, granny glasses, and a sealed train arriving at the Finland Station. The public option part of the subtitle does refer to health care, in which insurance companies extract surplus value in ways Professor Sherman suggests a government agency would not. He also proposes democratic management of large corporations (presumably not by hippie cooperatives or soviets of workers deputies, althoug the details are missing) as a way of taming some of the instabilities of market-directed resource allocation. That gives me a chance to go radical on radical economists. Complex adaptive systems, such as market-based allocation of resources, do what they damn well please, and they can produce disruptive fluctuations. But democratically managed economies subject to majority rule, Wise Experts acting in The Public Interest or no, are also complex adaptive systems.

(Cross-posted to 50 Book Challenge.)

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