Utsa Patnaik and Prabhat Patnaik "Capitalism and Imperialism" (Book Note)

 

Capitalism and Imperialism traces the historical trajectory of capitalism highlighting its intrinsic connection with colonialism and imperialism. The prevailing economic narratives, critiqued by the authors, have often presented a one-sided view, assuming that capitalism can be comprehended in isolation, divorced from its indispensable ties to colonial exploits and the abundant resources derived from colonization that propelled its trajectory.

 

The authors aim to rectify this historical oversight, asserting that traditional economics has suffered from a blind spot arising from its development primarily within metropolitan settings. The book is structured into six parts, with the initial four sections delving into the theoretical dimensions of the capitalism-colonialism nexus and the evolution of capitalism until the post-World War II era. The latter two segments expound upon the transformations in the post-war and neoliberal periods, dissecting the nuanced shifts in capitalism over time.

 

The historical epochs of capitalism are categorized into five stages: the pre-World War I era, the interwar period, the post-World War II "Golden Age of Capitalism," the era of globalization, and the recent years marked by a resurgence of perennial crises within capitalism, signaling an impasse. Throughout these periods, the book underscores the pivotal yet dynamic role played by colonialism and imperialism, serving as the common thread binding the various phases of capitalism's development. According to the authors, the prosperity of metropolitan centers in the narrative is intricately linked to the assistance provided by colonial and imperialistic plunder.

 

The core argument of the book challenges the conventional wisdom held by mainstream economists, who posit that money in the form of wealth is an anomaly due to its perceived inability to generate profits. In contrast, the authors contend that, historically, this has never been the case within capitalism. They set out to demonstrate that the persistent demand for wealth in the form of money poses a continual threat to the progression of capitalism. In the absence of external stimuli, capitalism in isolation would stagnate. These external stimuli, identified as pre-capitalist markets, state expenditures, and innovations, are crucial for sustaining capitalism on an ever-expanding scale. The authors emphatically reject the notion of capitalism as a self-contained and perpetual system.

 

The authors commence their examination of capitalism by characterizing it as a monetary system, asserting that it not only employs money for transactions but also for wealth accumulation. They argue that many economic schools fail to recognize capitalism's use of money to amass wealth, leading to the imperative of preserving the value of money. This is achieved through income deflation on the supply price of commodities, historically realized through imperialism. Imperialism, as defined by the authors, entails a relationship between capitalism and its environment, emphasizing the imposition of a regime that enforces income deflation to avert the threat of rising supply prices. Through colonial subjugation and plunder, the metropole aimed to maintain a stable supply price of raw materials.

 

The book meticulously traces the enduring centrality of imperialism to capitalism, acknowledging its evolving forms. In the post-war boom era dominated by Keynesian economics, imperialism's income deflation strategies were replaced by state-driven measures, sustaining demand in the metropolis while maintaining a trade balance favoring advanced capitalist nations. Following decolonization, nationalist policies empowered the local bourgeoisie with dirigiste regimes. However, in the neoliberal phase, the local bourgeoisie, once reined in by decolonized states, actively participates in the international finance system.

 

The concluding parts of the book delve into the current scenario, accompanied by the rise of neo-fascist politics, and advocate for a revitalized Left to counteract such trends. However, these sections are considered the weakest in the book. While the prognosis is largely accurate, the authors' visions of transformative politics are criticized as somewhat narrow. The authors contend that the economic order in decolonized states favored the local bourgeoisie, but nationalist policies also benefited petty producers, peasants, and craftsmen. Yet, with the integration of the big bourgeoisie into the neoliberal order, the plight of these groups has worsened, evident in recent protests against farm laws favoring the big bourgeoisie. The withdrawal of these laws highlighted the antagonistic relationship between the neoliberal regime and the masses of decolonized states. The big bourgeoisie now aligns with metropolitan capital, promoting the "opening up" of the world for free capital and goods flows, to the detriment of peasants, petty producers, and small capitalists.