[OPE] Hillel Ticktin: The theory of decline and capital

From: Doğan Göçmen (dogangoecmen@aol.com)
Date: Wed Jun 11 2008 - 02:19:42 EDT

The theory of decline and capital 

In the first of two articles, Hillel Ticktin, editor of Critique, looks 
        at the rise and fall of different modes of production and the problems 
        of transition and non-transition


Aspects of the decline of modern capitalism are all too evident today 
        - most notably the law of value, which is fundamental to the system. We 
        see the constant tendency to replace the law of value with administration, 
        resulting in increasing bureaucracy, both private and public, managerialism 
        and a tendency to authoritarianism. At the same time there is also the 
        self-defeating attempt to force the market back to its former dominance.

The logic of the situation leads to an increasing demand for control 
        from below and the substitution of economic control, using prices to direct 
        planning of use-values - hence the alternative logic of capital of reducing 
        democracy and attempting to use pseudo-markets instead. Results are patently 
        disastrous, as in public transport, education and health. For instance, 
        today we see Avian flu, yet a single company, Roche, has a monopoly on 
        the production of vaccines.

The poles of the basic contradictions are pulling apart and the mediations 
        have become both more difficult and more of a fundamental change in capitalism 
        itself. One result is that of disintegration - most obviously shown in 
        the phenomenal rates of the rich getting richer, the poor poorer, not 
        to mention crime and massive levels of unemployment. In theoretical terms 
        we are witnessing the promotion of the contradiction between use-value 
        and exchange-value into a conflict.

Huge levels of capital surplus are combined with low levels of growth 
        with all its consequences. The gap between the potential and actual surplus 
        product is rising. In the absence of planning, the system is becoming 
        more chaotic, more disintegratory, and hence more irrational, with unpredictable 
        consequences which threaten humanity itself.

As a result of the complexity of the system, with different sets of laws 
        operating and a disintegrative process at work, it is hard to understand 
        the society and confusion reigns in all aspects of the process of understanding. 
        Commodity fetishism is partially overcome, but it is also supplemented 
        by new derivatives like nationalism and racism. Despair, irrationality 
        and confusion create an atmosphere at once demoralising and explosive.

The crucial feature of the present time is that capitalism was overthrown 
        in a part of the world during the period of its decline, but capitalism 
        as a whole managed to hold out. However, in order to hold out it resorted 
        to three forms which altered the epoch. Firstly, it repressed and for 
        this purpose saw itself in a permanent state of war with communists. Secondly, 
        this in itself created the need to offer a more humane alternative than 
        had existed, in comparison with the communist future. That altered the 
        whole nature of the epoch itself, because it meant for the first time 
        that capitalism accepted two forms of control over itself which negate 
        the capitalist drive to accumulate. The first is the need for democracy, 
        albeit bourgeois democracy. The second, which is a partial result of the 
        first, is the need for a rising standard of living for all.

Underlying it all is the collision between the ever growing socialisation 
        of the means of production and so of labour, as opposed to the ever smaller 
        number of ever larger units of capital. Socialisation demands planning. 
        Monopoly is itself a form of organisation, but it contains an element 
        of competition and it continues to rely on an increasingly decadent form 
        of the law of value. As a result, the poles pull apart and there is disintegration 
        mixed in with increasing forms of direct control required to run the system. 
        Capitalism creates the potential for common ownership, but instead produces 
        a hybrid form - capitalist nationalisation - which malfunctions, being 
        neither socialist nor capitalist. It produces the potential for planning, 
        but instead has a variety of forms of administration, a consequently increasing 
        bureaucracy and with it growing corruption, which is greatest at the interface 
        between the public and private sectors.

Theory of decline

All things organic and inorganic in the universe are born, grow, mature, 
        decline and die. Decline is the necessary end period of any socio-economic 
        formation, which has gone through its embryonic and mature epochs. Each 
        of these periods will tend to go through the same phases, assuming that 
        they last a sufficient period of time.

When a mode of production is in decline, it has its own laws governing 
        it. The period of decline may be shared with a phase of transition to 
        the new society. The longer the decline lasts, the longer the shared period 
        itself will exist.

Decline has to be decline of the laws of motion of the mode of production. 
        Logically, as at the present time, there will be three sets of laws applicable 
        in a declining mode of production: the laws of capitalism itself, the 
        laws of the decline of capitalism and the laws of the transition.

At the present time, the concept of decline appears discredited in two 
        ways. Firstly, because it is quite apparent that modern capitalist economies 
        are growing and, secondly, because traditional Marxist theorists of decline 
        are no longer making the case. Indeed, for many Marxists, the whole concept 
        is an embarrassment precisely because people who claimed to be Marxists, 
        of different kinds - from Gerry Healy, who kept anticipating the final 
        capitalist crisis, to a variety of Stalinists - argued the case usually 
        on a very primitive basis.

Today Stalinism is dying and its doctrines discredited, while the dogmatists 
        of various kinds have little influence. As a result, the concept of decline 
        has to be investigated and understood cleansed of the pollution of dogmatic 
        and Stalinist thought.

In modern times it is Edward Gibbon who is most associated with the concept 
        of decline, when he wrote on the decline of the Roman empire. In fact, 
        he was writing at a time when British society thought of itself 
        as in decline. It was no coincidence that Oliver Goldsmith wrote The 
        deserted village at the end of the 18th century, which contains the 
        immortal lines: “Ill fares the land - To hastening ills a prey - Where 
        wealth accumulates and men decay.”

This attack on industrial capitalism was ahead of its time, but it was 
        expressing something real. The embryonic phase of capitalism - the period 
        of manufacture, as opposed to machinofacture - had come to an end and 
        hence the condition of the population closely connected to it had began 
        to decline, with the enclosures and the barbaric conditions in the early 
        period of the industrial revolution. This points to the fact that decline 
        is not only one of the broad epochs of capitalism, but it also applies 
        to the epochs themselves.

In thought, it was the development of theories of evolution which brought 
        the concept itself into more general discussion. Hegel produced his own 
        theory of societal evolution. Darwin reinforced the concept when he showed 
        how species came into being, flourished, declined and died. At the same 
        time, the growth of life sciences showed the same process existed for 
        all organic entities. This division between organic entities and physical 
        entities has only broken down in the last 40 years or so, as physicists 
        have shown that the cosmos itself has the same life cycle.

It was Lenin who developed the concept among Marxists, in his work on 
        imperialism. It is clear that Trotsky also accepted the analysis of decline, 
        particularly in the 30s, and the Stalinists went much further, in support 
        of the view that the USSR was a haven from the collapse of civilisation. 
        During the 20s and 30s Oswald Spengler and Arnold Toynbee also took up 
        the idea of decline, reflecting the horror of the World War I, the uncertainty 
        provoked by the Russian Revolution and the visible economic decline, particularly 
        of the British empire, which intensified with the great depression.

Interestingly, no one actually theorised decline as such among Marxists. 
        The Soviet Stalinists simply took Lenin at his word and proceeded from 
        there, assuming among other things that there was a law of increasing 
        misery and hence the standard of living in the west had to be going 
        down. To that they added a kind of doctrine, in which there was a permanent 
        general crisis of capitalism.

Trotsky held the components of a theory of decline: the growth of finance 
        capital, the relative weakness of the bourgeoisie with the rise of the 
        proletariat, etc. But he did not theorise them as decline. He developed 
        a theory of long waves (which I think is fundamentally correct), but it 
        is not linked to decline. One might have thought that the two great theorists 
        before 1914, Hilferding and Kautsky, would have developed such a theory, 
        but they conspicuously refused to do so.

It was Lenin who did conceptualise decline, though more empirically than 
        theoretically. For Lenin decline is bound up with the growth of monopoly, 
        interwoven with finance capital. But it is above all the demise of competition 
        that he sees as the essence of the epoch. This is logical, but he does 
        not spell it out. He gives empirical examples of decline in innovation. 
        Imperialism and war are themselves aspects of it.

Dialectics of decline

The basis of Marxism lies in political economy and its method is dialectics. 
        In his The difference between the Democritean and Epicurean philosophy 
        of nature, written in 1840 for his dissertation, Marx stated:

“To be sure, it is a commonplace that birth, flowering and decline constitute 
        the iron circle in which everything human is enclosed, through which it 
        must pass. Thus it would not have been surprising if Greek philosophy, 
        after having reached its zenith in Aristotle, should then have withered. 
        But the death of the hero resembles the setting of the sun, not the bursting 
        of an inflated frog.

“And then: birth, flowering and decline are very general, very vague 
        notions under which, to be sure, everything can be arranged, but through 
        which nothing can be understood. Decay itself is prefigured in the living; 
        its shape should therefore be just as much grasped in its specific characteristic 
        as the shape of life.”

I have cited this to indicate, firstly, that Marx was well aware of the 
        question of decline. Secondly, the conception of decline itself comes 
        from the ancient Greek philosophers - most particularly Aristotle - but 
        it was elaborated on in the 19th century with the acceptance of evolution, 
        most particularly by Hegel and Darwin. The distinction between organic 
        and inorganic is no longer necessary, as we see everything in evolution, 
        including the cosmos and our sun.

It is clear from this that decline is a necessary feature of any mode 
        of production, and most particularly of capitalism, and if it is not in 
        decline today we will have to ask at what point it will be so.

Decline represents limitations and disintegration of laws or, more accurately, 
        it represents the point at which mediations between the movement of a 
        phenomenon’s poles become increasingly difficult to sustain without the 
        two poles interpenetrating to the point of supersession. Mediations represent 
        the points of interpenetration of the two poles. Over time the frequency 
        and depth of mediation is such that the two poles are losing their difference.

Logically their negation of each other is then negated and the system 
        is superseded, but this process is not automatic and within a mode of 
        production the class struggle plays a crucial role at this point. If either 
        class finds ways of ignoring or destroying the mediative interactions, 
        then the system disintegrates rather than being superseded.

In other words, the system remains in a state of negation with the poles 
        standing in opposition to each other. Then ensues a crisis of the system, 
        which is itself a mode of overcoming this point of equilibrium. In principle 
        there could be many crises before the system is itself overthrown. If 
        it is not, and the poles of the contradiction do not interpenetrate, the 
        crisis is not resolved and the system disintegrates. Once it disintegrates, 
        there is always the possibility of a society without any system and hence 
        the intervention of barbarism. Decline occurs at the point when the system 
        is in process of supersession, but the process of supersession is a complex 

It is important to distinguish between decline and crisis. The decline 
        of capitalism is long-term, affecting every aspect of the system. The 
        system can suffer short-term and long-term crises. In its mature phase 
        capitalism will only suffer short-term crises: that is, arising from a 
        particular event. This may happen when the downturn in the economic cycle 
        reaches a point where it cannot be resolved without a slightly longer 
        period in which capital can enforce lower wages and worse conditions or 
        else finding some external method of raising the profit rate.

In the period of decline, these crises become prolonged, reflecting the 
        increasing difficulty of defeating labour or finding a compromise, which 
        is the more usual form today.

Crises, however, are resolved and mediations are found. In other words, 
        a crisis occurs when the labour-capital relationship requires a new form 
        of mediation, but in decline this becomes increasingly difficult and tends 
        towards the formation of new bourgeois strategies - often inchoate and 

There may be many crises before the system is overthrown, but the crisis 
        which occurs at the point at which it can be overthrown we can 
        call a terminal crisis. This is composed of a crisis in both the categories 
        and in the class struggle, so in this instance we are speaking of a crisis 
        where the working class has reached the point where it has sufficient 
        strength to overthrow a weakened system.

It is theoretically possible for the decline/transition period itself 
        to be frozen: ie, there is no actual transition to the new society and 
        the decline/transitional period so weakens the system that eventually 
        the society ceases to exist, because it is overthrown or for some other 

Disintegration and supersession

We only know in historical detail of two transitions and hence of periods 
        of decline - to feudalism and to capitalism. The absence of a transition 
        in China, in the case of the Asiatic mode of production, is itself very 
        interesting, but that is another discussion.

When we discuss any mode of production, then it is the extraction of 
        the surplus product which is crucial - and most particularly the form 
        in which it is extracted.

In the case of the ancient mode of production, that form was slavery 
        and tribute. In fact the two were connected, as many (and at some points 
        most) slaves were taken in war under the subjection of another tribe, 
        nation, city-state or ethnic grouping. However, as Marx points out in 
        the Communist manifesto, the ancient mode of production contained 
        different forms like serfdom and wage labour as well, but they were subordinate 
        to the main forms.

Decline therefore had to be decline in the form of the surplus product 
        and indeed that was the case by the time of the Roman empire, in that 
        the process of enslavement had slowed down. It obviously followed that, 
        once the subordinate state had been subjected, it could no longer be enslaved 
        if it were to be part of the empire. Instead tribute was paid. That in 
        turn was costly, as there were constant revolts and large armies had to 
        be maintained. By the 3rd century AD Diocletian had replaced slavery with 

We can therefore regard the whole period of the Roman empire and some 
        period before as the period of decline of the ancient mode of production. 
        From this point of view the Roman empire is the period of decline and 

We may note here that Edward Gibbon in The decline and fall of the 
        Roman empire points out the enormous rise of bureaucracy and its cost, 
        but also that the burden of taxation was so great that ordinary Italians 
        had taken to killing their newly born babies through leaving them to die 
        in the open. He says that Constantine tried to ameliorate the taxation 
        for the poor, but his measures had no effect.

The transition itself took on its unique form with the end of the Roman 
        empire, the rise of christianity and islam as the two feudal ideologies 
        of control, and the particular forms of the extraction of the surplus 

The point to notice in this context is the confusion, the multiplicity 
        of societal forms, the emergence and destruction of different societies. 
        Byzantium here appears as the ancient mode of production frozen in its 
        transition, unable to take the next step.

Decline of feudalism and rise of capitalism

The mature form of feudalism exists from roughly 700AD to 1100AD - the 
        crusades mark the watershed between maturity and decline. Capitalism was 
        coming into being. What is crucial here is the emergence of the surplus 
        product in the form of money and hence the conversion of labour rents 
        into money rents. The form of the surplus product had changed. That has 
        to be explained with the rise of both agricultural and industrial production 
        for a market, which in turn was facilitated by international trade. The 
        implication is that the surplus product itself had risen sufficiently 
        for such trade.

The feudal lords in this situation exemplify the nature of decline, in 
        that they are only interested in consumption and hence squander their 
        income in various forms of luxury. Then in order to raise their income 
        they attempt to squeeze the peasantry and the Jews. They go for foreign 
        adventures and the king, as the first feudal lord, does the same with 
        taxation, internal and external wars and victimisation of groups from 
        whom he can seize money and assets, particularly the Jews. The effect 
        is ruinous.

At the same time, we have the rise of the bourgeoisie - first and foremost 
        in Italy, where mass production of clothes and textiles is first encountered. 
        They in turn trade with the world, inter-relating with the east, particularly 
        India and China. We have to note that in both decline and transition the 
        process is international. It never takes the form which Maurice Dobb wants 
        to assign to it: that the emergence of the skilled worker into a capitalist 
        is the basis of the emergence of capitalism. This is simply wrong in its 
        categorisation. The whole process of a system in decline, transition and 
        emergence is international.

In the process of decline there is also the rise of transitional forms 
        like guilds, and that to the independent artisan is important. Whether 
        the independent artisan is part of the embryonic form of capitalism or 
        a transitional form emerging out of feudalism is itself in question. The 
        initial form of capitalism is one of manufacture, as opposed to machinofacture: 
        ie, it relies heavily on skilled workers and a mass of labourers. Accumulation 
        is first and foremost accumulation of capital, which finds its fullest 
        expression in fixed capital, but in the early stage fixed capital was 
        limited. It required the industrial revolution to replace manual labour 
        with machinery, which has become evermore automatic.

In this process, we witness the rise of value, money and, behind it, 
        abstract labour. One cannot have value in its full existence unless we 
        have abstract labour and abstract labour cannot exist in its full form 
        before one has machine production. In the early stages of capitalism, 
        therefore, we only have proto-value and proto-capital. Marx says that 
        the more developed is merchant capital, the less developed is capitalism. 
        In other words, in the declining years of feudalism we see the emergence 
        of merchant capital, which runs right through the early years of capitalism 
        itself. But if the country remains bound within this period of buying 
        low and selling high, then no value is created and it is only living off 
        a form of deception. This is similar to the period of primitive accumulation, 
        where the European nations robbed the rest of the world.

So we have three periods which merge in different ways, depending on 
        the countries involved - decline of the old, transition and the emergence 
        of the new. In this process, a whole series of different combinations 
        came into existence. Which were able to develop depended on the particular 
        correlations of class struggle and development of the categories. Capitalism 
        developed in all countries once it had succeeded in overthrowing feudal 
        socio-economic relations, even though in many countries the political 
        superstructure remained semi-feudal, as in France.

Not all countries, however, were able to fully emerge into the initial 
        stage of capitalism: eg, Holland. Spain too remained bound within its 
        imperial forms and hence could not develop. Countries in eastern Europe 
        were thrown backwards, becoming dependent on the more developed countries. 
        They provided cheap wheat for the west European market and had to protect 
        themselves against the predations of the west. They, therefore, re-introduced 
        a more slave-like form of serfdom. Hence in Russia we have the evolution 
        of the autocracy or the semi-Asiatic mode of production.

There are a number of points to be made in relation to this:

1. The evolution of capitalism to its mature form takes 700-800 years.

2. During that period we are talking of the decline of feudalism, which 
        runs in parallel with the transition to capitalism itself, and even with 
        emergent capitalism. Forms of feudal decline remain up to the 19th century.

3. There are abortive transitions - forms which are neither capitalist 
        nor feudal - which in principle cannot last, but do last many hundreds 
        of years.

4. In this process the value form evolves to the point where abstract 
        labour comes into existence and the law of value can operate under competition. 
        Labour-power becomes a commodity and wage-labour replaces all previous 
        forms as the means towards the formation of the surplus product/surplus 
        value. Money as the universal equivalent reaches its fullest form as the 
        means of accumulation and hence as world money.

5. The forces of production are developed to the point where machines 
        can operate under their own power and the potential of machines making 
        machines is established. Hence at the point where abstract labour is established 
        its demise is also heralded. When machines make machines, labour is no 
        longer needed and hence there is no abstract labour, no value and no profit.

6. This logic, however, is aborted by a capital afraid of its own end. 
        It refuses to go towards total automation as too costly and non-profitable. 
        It turns to finance capital.

The class struggle

Whereas Dobb and other Stalinists saw the issue as a transition within 
        one country, Brenner and his followers, like Ellen Meiskins Wood, see 
        it as an international class struggle. It is clear that the class struggle 
        does play a pivotal role in any change in the mode of production, but 
        it cannot do so on an arbitrary basis or without the necessary change 
        in the mode of production.

The struggle of the peasantry in Europe played a crucial role in the 
        decline and in the transition to capitalism, but it is not unilinear. 
        In China it looks very much as if the strength of the ruling class was 
        such that it suppressed change. Indeed the same may be said of the ancient 
        mode of production, where Marx argues that the Roman empire had to be 
        overthrown from outside. Byzantium seems to prove that point. If the ruling 
        class suppresses the development of the forces of production, whether 
        through the elimination of science, as in the burning of books in China, 
        or through their physical destruction, the transition will be aborted 
        and the system will continue to exist even if in decline, ultimately to 
        be overthrown from outside.


Doğan Göçmen
Author of The Adam Smith Problem:
Reconciling Human Nature and Society in
The Theory of Moral Sentiments and Wealth of Nations,
I. B. Tauris, London&New York 2007

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