Ernest Mandel's "Marxist Economic Theory" (Book Note)

 

 

Ernest Mandel, a prominent figure in Trotskyite circles associated with the Fourth International, is renowned for his extensive writings on Marxism. Among his works, "Marxist Economic Theory" stands out as a significant contribution. Although titled as a theoretical work, it is more accurately described as a comprehensive analysis of the origins and evolution of capitalism, grounded in Marxist principles.

 

Mandel's book delves into the historical and theoretical underpinnings of capitalism, drawing on a wealth of evidence and contemporary examples. While not presenting original theoretical insights, Mandel synthesizes Marxist thought with historical and empirical data to offer a detailed examination of capitalism's development.

 

The early chapters explore precapitalist economic structures across various civilizations, aiming to broaden the analysis beyond a Western-centric perspective. While Mandel's attempt to 'de-Westernize' the material may have its limitations, he incorporates insights from diverse societies, including India, China, the Arab East, and Africa.

 

The book progresses through chapters on social divisions of labor, surplus production, petty commodity production, money, and capital accumulation. These set the stage for an examination of capitalism's inherent contradictions, followed by discussions on trade, credit, agriculture, and the growth of national income.

 

One notable section is Chapter Eleven, which provides a thorough overview of periodic crises within capitalism, along with an analysis of business cycle theories proposed to explain these fluctuations. Overall, "Marxist Economic Theory" offers a comprehensive and insightful exploration of capitalism's dynamics, informed by Marxist analysis and enriched by historical and empirical evidence.

 

 

In the latter sections of his work, Mandel explores the trajectory of capitalism into its later stages, including monopoly capitalism, imperialism, and what he terms as the epoch of capitalist decline. In this phase, the state increasingly aligns with monopolies to safeguard their profits, leading to a fusion of state apparatus and corporate interests. Mandel analyzes the altered nature of crises and the emergence of inflation as inherent tendencies of what he terms 'modern war capitalism'.

 

He criticizes state interventionists, often labeled as 'socialists', who seek to rescue the system without fundamentally challenging it. Mandel emphasizes that the growth of the public sector or selective nationalization does not constitute socialism, likening it to the impossibility of being 'a little bit pregnant'.

 

Furthermore, Mandel identifies intensified contradictions between planned production and capitalist anarchy. While planning is adopted to a limited extent, it fails to address the profit motive comprehensively. The problem of underdevelopment in colonial economies exacerbates as overcapitalization in capitalist countries necessitates unproductive expenditures to prevent stagnation.

 

Mandel discusses the Soviet economy and socialism, although his Trotskyite perspective influences his analysis. While he acknowledges the Soviet Union's early achievements, he criticizes its economic trajectory since the rejection of 'super industrialization' proposals in the mid-1920s. He offers a critical view of wage differences in the USSR, attributing them to the continued existence of commodity production and insufficient productive power to satisfy basic needs.

 

Ernest Mandel's characterization of the stage between capitalism and socialism as a transitional society is contested, as Marx envisioned a higher stage of socialism or communism marked by the production of an abundance of use-values. Mandel's insistence on abolishing economic categories like commodity, value, and money under socialism is criticized, as Marx's conception suggests that these categories persist until the higher stage of communism.

 

Looking ahead, Mandel forecasts a future where political economy will become obsolete as society reaches a state of plenty, rendering commodity production and economic calculation unnecessary. He suggests that Marxist economists, by consciously working towards the abolition of their own profession, are pioneering this transition. However, some argue that Mandel's interpretation overlooks Marx's distinction between socialism and communism, and the persistence of certain economic categories in the transitional period.