Industrial Societies (Routledge Revivals)

Crisis and Division in Western Capatalism

Richard Scase

• Publisher: Routledge
• Year: 2015
• Print ISBN: 9781138846906
• eBook ISBN: 9781317539186
• Topic: Social Sciences
• Subtopic: Business General
• Index: Social Sciences

This book, first published in 1989, addresses an issue that stood at the centre of sociological concern – the changing character of industrial societies.

The authors examine the nature of the industrialization process, in terms of its impact upon and development within both state socialist and capitalist societies. Is 'industrialism' a constant phenomenon within both kinds of society, or are distinctive differences apparent? In the 1960s, it did seem that economic growth and technological change were producing similarities in social structure between the different socio-political systems; it now appears however that the crisis that have developed during the 1980s how illustrated their contrasts. Through the analysis of this trend in the West, in Eastern Europe and in China the authors clarify central issues for the student of sociology:

• The changing character of national states, organized labour, stratification systems and class relationships
• Processes of social integration, cohesion and control
• The extent to which dominant groups are able to sustain social and economic privileges in different socio-economic systems
• The changing pattern of work and employment relationships
• The nature of class, gender and ethnicity as sources of socio-economic division

1
The limits and divisions of industrial capitalism

KRISHAN KUMAR

Revolutionaries sometimes try to prove that there is absolutely no way out of a crisis [for the ruling class]. This is a mistake. There is no such thing as an absolutely hopeless situation.

Lenin, Report to the Second Congress of the Communist International, 19 July 1920

The decline of Western capitalism?

The 'decline of the West' has been pronounced at regular intervals since Oswald Spengler's gloomy prognostications of 1918. It was a favourite theme of Marxist and other literary intellectuals such as Christopher Caudwell and Ortega y Gasset in the 1930s. Later, in the 1970s it reappeared in the wake of the oil crisis and a rude awakening to the problem of the world's future supplies of energy. Ecological critiques were now joined to more traditional Marxist analysis to proclaim the bankruptcy of Western capitalism. Capitalism, as the dominant form of industrialism, seemed incapable of escaping the logic of its growth process. As an ecological, economic and social system, it was reaching its limits. Once more the choice seemed to be that posed by Rosa Luxemburg at the beginning of the century: socialism — of some kind — or barbarism.

As the millennial year 2000 beckons, such eschatological speculations are bound to grow. Every civilization known to us —and a fortiori every one we don't know — has after all declined. Often, like the Hittites or the Mayas, they have disappeared altogether, leaving only a few material remains. Or they go into a state of frozen or suspended animation, like the Polynesians. Of the twenty-six civilizations identified by Arnold Toynbee, sixteen are dead and five 'arrested'. Of the five remaining, one of these, Western civilization, is rapidly swallowing up the rest. Is there any reason to think that Western civilization will prove an exception to the law of decay and breakdown? And as it turns itself into the only remaining civilization, a world system or world civilization, does not its own downfall now threaten the downfall of the whole species?

Most theories of civilizational decline emphasize internal factors, or 'internal contradictions'. Suicide, not murder, is the general verdict. In Toynbee's case, this takes the form of a process whereby a civilization's ruling 'Creative Minority' becomes a coercive 'Dominant Minority', losing its ability to bind the 'Internal Proletariat' to its culture and so unleashing class war. The 'External Proletariat' of barbarians beyond its borders, previously kept in check with little difficulty, can now successfully invade a system fatally weakened by internal strains (Toynbee, 1962). Max Weber too, in his account of the decline of the Roman Empire, picks out the internal contradictions of the slave-based economy of the ancient world as the principal cause. The barbarians overran an imperial system that was already pointing their way, away from a centralized empire based on slave labour towards a manorial system based on family serfdom. 'The Empire had ceased to be what it once was, and the barbarian invasions simply concluded a development which had begun long before . . . When, after one and a half centuries of decline, the Western Empire finally disappeared, barbarism had already conquered the Empire from within' (Weber, 1976, p. 389).

But such theories of decline, with their concentration on internal social mechanisms of contradiction and conflict, have always had to contend with others that emphasize extraneous or natural factors. Social Darwinism looks to military fitness, in an environment of predatory and competitive states, as the key to survival or servility. International war is the testing agency that elevates some societies and enslaves others. Malthusians, from an even more cosmic perspective, have pitilessly observed the levelling of human societies as they come up against the blank wall of starvation. Population increase continually outstripping food supply, successful and growing societies are punished by their own progress, as if for hubris. Nature, in the form of plagues and famines, jerks them sharply back to their primitive starting points. The sorry cycle then starts all over again. What latter-day doomster has been able to match the Old Testament thunder of the Reverend Malthus himself?

The power of population is so superior to the power in the earth to produce subsistence for man, that premature death must in some shape or other visit the human race. The vices of mankind are active and able ministers of depopulation. They are the precursors in the great army of destruction; and often finish the dreadful work themselves. But should they fail in this war of extermination, sickly seasons, epidemics, pestilence, and plague, advance in terrific array, and sweep off their thousands and ten thousands. Should success be still incomplete, gigantic inevitable famine stalks in the rear, and with one mighty blow levels the population with the food of the world.

(Malthus, 1985, pp. 118-19)

Decline and downfall, all theorists agree, can however inevitable take a very long time. Weber, as we have seen, speaks of the decline of the Roman Empire stretching over a period of at least a century and a half. Toynbee for his part considers the whole Roman Empire as but the penultimate stage in the decline of a larger entity, Hellenic Society, as it vainly attempts to rally within the framework of a 'universal state'. Hellenic Society had in fact been in decline since the convulsions of the Peloponnesian War of the fifth century BC. 'The Roman Empire itself was a monumental symptom of the far-advanced decline of a Hellenic Society of which this empire was the universal state . . . this empire was already doomed before it was established' (Toynbee, 1962, p. 61).

This is la Iongue durée indeed, taking in over a thousand years; and one wonders how far such a long-breathed perspective is useful to anyone but the most philosophically minded historian. Certainly from the point of view of a comparative historical sociology, centuries rather than millennia might seem a more appropriate time dimension — for instance, the four or five centuries, from the fourteenth to the eighteenth century, that Braudel takes as the period of the 'economic civilization' of commercial capitalism in Western Europe (Braudel, 1970, p. 153). What such a time horizon would sufficiently suggest is that societies can live with their 'contradictions', if not comfortably at least tolerably, for long periods. The signs of decay may be observable only retrospectively, as to an eighteenth-century European like Gibbon musing on Roman history amidst the ruins of the Capitol. Or the persistence of old forms and old values may be so powerful and pervasive as to hide for a long time the seeds of decay. Joseph Schumpeter was convinced that 'there is inherent in the capitalist system a tendency toward self-destruction', and that for those with the eyes to see the signs were becoming evident. But he could also see all around him the evidence of a still confident and prosperous bourgeoisie. 'The middle class is still a political power. Bourgeois standards and bourgeois motivations though being increasingly impaired are still alive . . . The bourgeois family has not yet died', etc. These may, he conceded, be thought of as surface, short-run factors. But 'from the standpoint of immediate practice as well as for the purposes of short-run forecasting — and in these things, a century is a "short-run" —all this surface maybe more important than the tendency toward another civilization that slowly works deep down below' (Schumpeter, 1976, pp. 162-3, my emphasis).

If a century can be considered a 'short-run', then it would clearly be no contradiction to expect, say, the eventual demise of industrialism through the exhaustion of fossil fuels and mineral resources, while at the same time remaining relatively optimistic about its foreseeable future over the next century or so. The same can be said about the Marxist notion of 'the falling rate of profit' as an inherent long-term tendency of capitalism, and one that will compass its doom. So long as there are fresh fields for capitalism to conquer — and this could, without being too fanciful, now include other worlds than our own — it may be only of theoretical interest to deduce from its working some distant point in time when the accumulation crisis will reach revolutionary proportions.

Still, it is one thing to stave off the ultimate, the terminal crisis. There may be other problems in the meantime scarcely less pressing. While to the out-and-out Darwinian survival may be the only thing that matters, human societies have generally also been concerned with the terms of that survival. Those inmates who survived the Nazi concentration camps endured in conditions that few would describe as human. To have remained alive was certainly a triumph of individual ingenuity and resilience. But many would question whether, if whole societies came to resemble concentration camps, survival on these terms and in those conditions could ever be worth fighting for. Similar things have been said of some of the slave societies of the past. Social survival is the necessary premiss of all human values and purposes. But it is not synonymous with them.

This is perhaps to put the matter too alarmingly. Few societies are so intolerable that some space for humanly valued activities cannot be found. The point is simply that there can be questions about the 'limits' to social development short of the stage where limits become absolute. Societies can throw up a range of problems that suggest, not catastrophe, but systematic failures and lesions of various kinds. Life can be made so unpleasant and uncomfortable, so threatening and debilitating, that people withdraw from society, or seek to escape it. Society may have gone beyond some point — never easy to fix with precision — at which its institutions still function relatively harmoniously, and that can still deliver a relatively fulfilling life to the bulk of the population. The system survives, but shows increasing signs of wear and tear. It is just as important — in the short run, more important — to consider these relative limits and incapacities as to speculate on the long-term capacity for survival of the system as a whole.

In the following sections I consider views of this kind as well as those concerned with long-term survival. I make no attempt, of course, to be comprehensive. I have merely selected some examples which are useful for opening up questions about the future development of industrial societies, and for suggesting some of the newer sources of strain within them.

Capitalism and the world system

Despite, or perhaps because of, its origins in nineteenth-century evolutionary social philosophies, sociology has shown little interest in the transformations of whole social orders, and the mechanisms that bring this about. Following Weber, there has been some concern with origins — at least, the origins of capitalism — although even there the field has largely been left to sociologically minded historians such as R. H. Tawney and Christopher Hill. But to scan the literature on revolution, the concept most directly relevant to breakdown and renewal, is to be struck by the paucity of serious sociological contributions (and one Skocpol, 1979, does not make a summer). To repeat the old but still accurate charge: sociology has been good at explaining order; it has been far less successful in dealing with change.

The exception of course is Marxism. Marxism is the most powerful modern theory of revolution and social transformation. But its limitations as such have also been widely exposed, both in its treatment of past transformations — for example, from feudalism to capitalism — and its anticipation of future ones. Most pertinent to the present concern, it remains true to say that while Marx provided a compelling anatomy of capitalist society, his account of its transformation and supersession in a socialist revolution is, as all admit, incomplete and unsatisfactory.

Marx gives an unrivalled account of the rise of modern society. His writings on the origins and development of capitalism are the best part of his work, and better than anything else yet offered on the subject by anyone. In the Grundrisse and Capital, in the occasional writings on European politics and society, Marx provides a comprehensive sociology of bourgeois capitalist society that is still unsurpassed, and off which modern sociology still lives (see Bottomore, 1975; Davis and Scase, 1985).

On the future development of capitalism, the case is less clear. Marx's contempt for futurology — 'I don't make recipes for the cookshops of the future' — is to his credit. To have seen something of the barrenness of contemporary futurology must make us grateful that Marx did not indulge in detailed prediction and prophecy (although the attack specifically on utopianism, a different enterprise, was unfortunate and misplaced).

Nor is it true to say that Marx's account does not contain much valuable material on the future of capitalist society. Any developmental or evolutionary theory, as in essence Marxism is, must embody some notion of emergent properties or processes. Of this there is a good deal in Marx, on both general and particular matters. The analysis of technological innovation, de-skilling, and the general proletarianization of labour needs very little to add to it to bring it up to date, as Harry Braverman (1974) so vividly demonstrated. So too with the account of the concentration and centralization of capital, and the projected rise of managerial and monopoly capitalism (Sweezy, 1972; Heilbroner, 1985). Marx had from the first seized on the world character of capitalism; hence the massive growth in the internationalization of capital and the international division of labour would have come as no surprise to him.¹ In a celebrated passage in the Grundrisse, even the fully automated society is anticipated, at a time when mechanization had barely got under way (Marx, 1973, p. 705). In the late-twentieth-century world of multinational corporations, the North-South divide, automation, technological unemployment, and a growing underclass of casual, unskilled workers, Marx would have found little reason to think that his analysis of more than a century ago was fundamentally mistaken. What might surprise him, and what surely ought to astonish us, is how little he would have to change or add to his original prognosis.

Would he also have felt the same way about his ultimate prognosis, that capitalism must eventually collapse and give way to socialism? Again, the evidence of the past century would have given him some grounds for reaffirming his belief. The instability of capitalism as a system shows little sign of abating. The 'great thunderstorms' in which the economic contradictions of capitalism express themselves (Marx, 1973, p. 411) have blown up often enough. Crises and depressions, the upswings and downswings of the business cycle, the 'long waves' of growth and recession, have continued with remarkable regularity since the time of Marx's Capital (Maddison, 1982, pp. 64-95). Mass unemployment has been once already, in the 1930s, and returned half a century later to show that Keynesian recipes may not be enough. Technological unemployment, a spectre raised by Keynes himself, threatens a not too distant future of 20-25 percent unemployed among the adult populations of the industrial countries (Merritt, 1982). The growth and internationalization of capital have brought with them new sources of vulnerability. As the oil-producing countries showed with striking effect in the 1970s, a small group of countries in control of a strategic industrial resource can now exert something like blackmail on even the most powerful capitalist nations. With new countries — Israel, India, Pakistan — now joining the nuclear club, the possibility of other kinds of pressure on the guardians of the world capitalist order increases further.

And yet the oil crisis itself is a good example of how capitalism can weather even the roughest storm. The OPEC countries increased the price of oil fourfold in 1973—4, and doubled it again in 1979, amounting to more than a tenfold rise in the price of oil in the 1970s. This was at a time when Western countries had become increasingly dependent on oil: in 1973, oil imports were more than seventeen times their 1950 level, and oil represented half of total energy consumption, compared with a quarter in 1950. The oil shock produced simultaneously recession and inflation. Capitalist world production fell by 10 per cent in less than a year, and the average annual price increase in Western countries in the mid-1970s was 12-13 per cent. Unemployment rates too began to climb, rising from an average of 2.5 per cent in 1973 in the Western countries, to 5.5 per cent in 1980. Following the dizzying growth rates — an annual average of 5.5 per cent-and virtually negligible unemployment of the 'Golden Age' of 1950-73, the post-1973 period saw the capitalist countries in the worst recession since the 1930s (Maddison, 1982, pp. 142-57). In a series of trenchant essays written in the 1970s, the contemporary historian Geoffrey Barraclough proclaimed 'the end of an era'. 'We stand at a watershed in world history . . . The days of neo-capitalism are numbered . . . Neocapitalism, with its pretensions to have found the answer to Marx, was the expression of a temporary situation, borne along not by its own dynamic but by the upward wave of the economic cycle' (Barraclough, 1974, p. 20; 1975, p. 24; 1976, p. 31).

In the upshot the prophecies of collapse seemed wide of the mark. The West rallied under the leadership of the United States and brought about a remarkable re-stabilization — or at least 'normalization' — of the international economic order. The first step was to separate the non-oil-producing Third World nations from the OPEC cartel, thus heading off a potentially threatening anti-Western coalition and a strategy of 'collective self-reliance'. This was done through a typical mixture of threat, bluster and bribery. The non-OPEC LDCs (least developed countries) were warned that they, not the West, would suffer most from 'trade union' tactics against the capitalist bloc. They were, it was pointedly remarked, critically dependent on the West, especially the United States, for food and technology. Their best hope for economic development lay in a relationship of 'interdependence' with the West, not one of confrontation. The speedier the West's recovery, the likelier the improvement in the LDCs' own prospects.

The pill was sweetened somewhat by the decision to increase lending quotas to the LDCs through the International Monetary Fund, and by the establishment of a 'Common Fund', underwritten by the developed countries, to stabilize the prices of raw materials — which made up more than 80 per cent of the LDCs' export earnings — if they fell too far on world markets. But the balance — or rather imbalance — of power was clear. The LDCs' demand for 'indexation' — the tying of the price of raw materials to the price of manufactures — was decisively rejected by the West. So too was a request for an easing of the debt to Western banks. As Barraclough observed, in a somewhat more chastened vein, it was shown 'that if recession is notoriously a bad time for trade unions to fight for wage increases, it is also a bad time for the less developed countries to fight for NIEO' (the New International Economic Order) (Barraclough, 1978a, p. 47).

For their part, the OPEC countries were co-opted into the capitalist bloc through the recycling and absorption of petrodollars into the capitalist economies. Direct and portfolio investment gave the OPEC cartel an increased stake in the United States and other capitalist countries. If Western capitalism was hostage to OPEC, OPEC soon became hostage to capitalism. Vast amounts of technology, ...

Table of contents

• Cover
• Title
• Copyright
• Original Title
• Original Copyright
• Contents
• Notes on Contributors
• Introduction
• 1 The limits and divisions of industrial capitalism
• 2 Corporatism and the New Right
• 3 Employment relationships in economic recession
• 4 From 'informal economy' to 'forms of work': cross-national patterns and trends
• 5 Economic recession and gender divisions in Western capitalism
• 6 Ethnic divisions and class in Western Europe
• 7 Social change, division and control in the USSR
• 8 Crisis and conflict in East European state socialism
• 9 Development and socialism in post-Mao China
• Bibliography
• Index