118 CRISIS IN CAPITALIST SOCIETY Cain, Maureen and Hunt, Alan, eds. 1979: Marx and Engels on Lane. Greenberg, David F..ed. 198 1: Crime and Capitalism Readings in Marxist Criminology. Phillips, Paul 1981: Marx and Engels on Law and Laws. Quinney, Richard 1977: Class, State and Crime. Taylor. lan, Walton, Paul, and Young, Jock 1973: The New Criminology: For a Social theory of Deviance. — 1975: Critical Criminology. ‘Thompson, E. P. 1975: Whigs and Hunters: The Ori gi of the Black Act DAVID GREENBERG crisis in capitalist society Traditionally Marx- ists have conceived a crisis as the breakdown of the operating principles of society. In capitalist, society such a breakdown is held to be generated by the accumulation process determined by the tendency of the rate of profit to fall (see FCONO- MIC CRISES), But a distinction must be drawn between, on the one hand, a partial crisis or collapse and, on the other, acrisis which leads to the transformation of a society or social forma- tion. The former refers to such phenomena as the political-business cycle which involves seem- ingly endless booms followed by sharp down- turns in economic activity and which is an ende- mic feature of capitalism. The latter refers to the undermining of the core or organizational prin- ciple of a society; that is, to the erosion or destruction of those societal relations which determine the scope of, and limits to, change for (among other things) economic and political activity. Marx identified the organizational principle of capitalist society as the relationship of wage labour and capital; and he formulated the fun- damental contradiction of this type of society as, that between social production and private appropriation, that is social production for the enhancement of particular interests. Assuming that Marx was right about this, the following questions arise: have events in the last hundred years altered the way in which the fundamental contradiction of capitalism affects. society's dynamics? Has the logic of crisis changed from the path of crisis-ridden growth and unstable accumulation to something fundamentally dif- ferent? If so, what are the consequences for patterns of social struggle? Marx accurately predicted a general te in all capitalist societies towards _ sive industries and increased concentratign™ capital. Later Marxists have documented frms and industries have become increasing? interdependent (Gurland 1941, Neu 1944; Baran and Sweezy 1966). While i useful toanalyse present-day capitalism inte of a number of sectors (the competitive ligopolistic private sectors, the residual labo sector and the state sector) itis striking how fy fortunes of many enterprises and industies ay interrelated. The network of interdependence ensures, at best, a delicate economic equili. rium. Any disturbance or disruption of econg. mic life can potentially ramify throughout the system. A bankruptcy of a large firm or bank, for example, has implications for numerou, apparently sound enterprises, whole communi. ties, and hence for political stability. Accord ingly, if the economic and political order of present-day societies isto be sustained, extensive state intervention is required. Viewed in this light the twentieth-century burgeoning of state activity, the expansion of ‘interventionist machinery’, can be seen as inevitable. The exten: sive effects of changes within the system (high rates of unemployment and inflation at the troughs and peaks of the political-business cycle] and/or the impact of external factors (shortages of raw materials as a result of international political events, for instance) have had to be carefully managed. The attempt to regulate economic activity and sustain growth, an attempt which is associated closely with Keynes and the idea of fiscal and monetary management (and which was 4 marked feature of political life from the 1950s tothe early 1970s), deepened the state's involve ment in more and more areas (see STATE. MONO” POLY CAPITALISM). This involvement itself ge™ erated difficulties which suggest that even if particular states were successful in minimizing economic fluctuations, this was only achieved by staving off problems and potential crises (Habermas 1973). In order to avoid economic crisis and political upheaval, governments 4 states had to shoulder an increasing share of tht costs of production. In addition, in order to fulfl their increasingly diversified roles, they had expand their bureaucratic structures, thus if creasing their own internal complexity. Thcomplexity in turn entailed an in- inf eed for cooperation and, more impor creased Muired an expanding state budget. The tantly ear cinance itself through taxation and ae jm capital markets, but it could nor do toate way which would interfere with the ths 1 ion process and jeopardize economic are These constraints helped to create 3 frovyon of almost permanent inflation and saat public finances (O'Connor 1973). Ifthe cra cannot develop adequate policy strategies srchin the systematic constraints it encounters, ‘Re esult is ikely 10 be a pattern of continuous Menge and breakdown in policy and planning tpestand Connolly 1976). The problems are so Neely structured that it seems very unlikely indeed that any government can reverse these developments for anything other than the shor- tests of periods. Attempts to ‘roll back the state’ inthe 1980s and early 1990s have only achieved limited success (see Held 1989). ‘The political consequences of this situation have been interpreted in different ways. If ec nomic problems and the ensuing struggles be- tween nation states do not lead to war, a deepen- ing crisis of legitimacy, Habermas (1973) and Offe (1972) have argued, will face Western class democracies. The state is enmeshed in contra- dictions: intervention in the economy is un- avoidable yet the exercise of political control over the economy risks challenging the tradi- tional basis ofthe legitimacy of the whole social order~the belief that collective goals can prop: «rly be realized only by private individuals acting in competitive isolation and pursuing thei aims with minimal state interference. The State's very intervention in the economy and other spheres draws attention £0 issues of choice, planning and control, The *hand of the State iy more visible and intelligible than ‘the 'nvisible hand” of the market. More and more areas of life are seen by the general population as Politcized, that is as falling within its (via the Sovernment’s) potential conteol. This develop: "nent, in turn, stimulates ever greater demands on the state; for example, for participation and Consultation over decisions. If these demands Cannot be met within available alternatives the State may face a “legitimation crisis’, Struggles ‘ver, among other things, income, control over the work place, the nature and quality of state Bods and services, might spill beyond the owin CRISIS IN CAPITALIST SOCIETY 119 boundaries of existing institutions of economic management and political control. Under these circumstances the fundamental transformation of the system cannor be ruled out; it is unlikely to result from one event, such as an insurrectio- nal overthrow of state power, but more likely to he marked by a process of continuous erosion of the existing order’s capacity to be reproduced and the progressive emergence of alternative insti Those who have sketched this scenario have tended to underestimate and play down the social forces which fragment, atomize and hence privatize people’s experiences of the social world, Factors such as differentiated wage structures, inflation, crisis in government finances and uneven economic development, which disperse the effects of economic crisis on to ‘groups’ such as consumers, the elderly, the sick, schoolchildren, are all part of a complex series of developments which combine to make the fronts of class opposition repeatedly frag- mented and less comprehensible (Held 1982, 1989). A striking feature of these tendencies has been the emergence in many Western societies of what have been called ‘corporatist arrange. ments’. The state, in its bid to sustain the con- tinuity of the existing order, often favours selec- tively those groups whose acquiescence and sup. port are crucial: oligopoly capital and organized labour. Representatives of these ‘strategic groups’ (trade union oF business confedera- tions) then step in alongside the state's represen- tatives to resolve threats to political stability through a highly informal, extra-parliamentary negotiation process, in exchange for the enhan- cement of their corporate interests (Schmitter 1977; Panitch 1977; Offe 1980). Thus a ‘class compromise’ is effected among the powerful but at the expense of vulnerable groups, for example the elderly, the sick, non-unionized, non-white, and vulnerable regions, such as those areas with “declining” industries no longer central to the economy (Held and Krieger 1982). Thus erucial fronts of social struggle can be repeatedly frag- mented. Under these circumstances political outcomes remain uncertain. But there are trends which enhance the pos- sibility of a severe crisis. The favouritism to- wards dominant groups expressed by corporatist strategies and/or ‘special’ bargains erodes the clectoral/parliamentary support of the more ons.120 CRISIS IN CAPITALIST SOCIETY vulnerable groups, which may be required for the survival of a regime. More fundamentally, corporatist arrangements may erode the mass acceptability of institutions which have traditio- nally channelled conflict; for example party sys- tems and conventions of collective bargaining. Thus new arrangements may backfire, en- couraging the formation of movements oppos- ing the status quo, based on those excluded from key decision-making processes, such as shop floor workers and shop stewards, those con- cerned with ecological issues, and the women’s movement activists (Offe 1980). While there is widespread scepticism about conventional politics, there is also, however, considerable uncertainty about alternatives to the status quo: Cold War attitudes and, of course, the rise and demise of Stalinism have discredited socialist ideas in the eyes of many. There is considerable uncertainty about what kind of institutions there might be and also about what general political directions should be taken. Thus there is reason to believe that the oft-expressed scepticism and remoteness many people feel in relation to dominant political institutions might be the basis of further politi- cal dissatisfaction in the future. But as possibili- ties for antagonistic stances against the state are realized, so too are the germs of a variety of other kinds of political movement, ¢.g., move- ments of the New Right. Anxiety about direc tionless change can fuel a call for the re- establishment of tradition and authority. This is the foundation for the appeal by the ‘new" con- servatives ~ or the New Right ~to the people, to the nation, to many of those who feel so acutely unrepresented. It is important to stress that trends such as these, in all their complexity and ambiguity, cannot be interpreted independently of interna~ tional conditions and pressures. The capitalist world was created in dependence on an interna tional market and is ever more dependent on international trade. The multiplicity of econo- mic interconnections between nation states which are beyond the control of any one such state (Wallerstein 1974), disproportional econ- omic development and uneven economic development generally within and between ad- vanced industrial societies and Third World countries, enhance the likelihood of intensive struggles over who is at the centre and on the periphery of the economic order, and over yj controls what resources. What cannot ignoredis the highly contingent, inherently day. gerous nature of the international system nation states, which has its origins before talist development but has been profoundly fluenced by it (Poggi 1978). In order to understand crisis tendencies tg, day, therefore, a differentiated analysis of ine. national conditions which form the constrain, on, and the context of, the politics of modem societies is necessary. It is precisely the intersee tion of processes and events in national arenay = crisis of particular state forms, emergence of new social and political movements, conflicts in the relation between regimes, parties and econ. ‘omic institutions — with international develop. ments, which have been the crucial determinans of transformative crises that affect the organiza. tional principle of society (Skocpol 1979). Butit is hard to see how such an account can take the form prescribed by classical Marxism with is emphasis on, for instance, history as the pro- gressive augmentation of the forces of production or history as the progressive evolution of societies through class struggle (Giddens 1985). Develop ments within and between societies seem tohave burst the boundaries of this conceptual scheme. The theoretical tools of Marxism are inadequate as a basis for a theory of crisis today. Reading Best, Michael and Connolly, William 1976: cized Economy. Giddens, Anthony 1985: The Nation-State and Vie lence. Gurland, A. R. L. 1941; ‘Technological Trends and Economic Structure under National Socialism’. Habermas, Jurgen 1973 (1976): Legitimation Crisis Held, David 1982: “Crisis Tendencies, Legitimatot and the State’. In John Thompson and David Held edt Habermas: Critical Debates. — 1989: Political Theory and the Modern State. — and Krieger, Joel 1982: “Theories of the State: Som* ‘Competing Claims’. In Stephen Bernstein et al. eds. T# State in Capitalist Europe. O'Connor, James 1973: The Fiscal Crisis of the Stale: Offe, Claus 1972: Strukturprobleme des kapitalist™ ischen Staates. — 1980: “The Separation of Form and Content it Liberal Democratic Politics’1977; ‘The Development of Corporatism in panes = Fiperal Demoer26 Gianfranco 1978: The Development of the sets. 1977 Modes of Interest Intermediation it dels of Societal Change in Western Europe’ stocpa, Theda 1979: States and Social Revolutions. ako Immanuel 1974: The Modern World Sys- tem crisis in socialist society The idea of crisis in a socialist society has formed, until recently, no part of Marxist thought. On the contrary, so- Pralism was conceived as a definitive resolution of the contradictions and crises of capitalism which Marxist theory was primarily concerned toanalyse. Marx and Engels themselves refused to speculate about the economic and social arrangements of the future society, which they saw as developing on its own foundations, but, they clearly assumed that this would be a har- monious development, no longer riven by class conflicts, in which the ‘associated producers’ would act collectively (and somehow sponta- neously) to promote the common good. Some Marxists of the following generation, to be sure, recognized that the construction of a socialist economy and society, far from being a simple matter, would present a variety of problems. Kautsky (1902), in his text on ‘the day after the revolution’, examined some of these, while Otto Bauer (1919) argued that the process of socialist construction, after the working class had gained Political power, would necessarily be slow and difficult, since ‘it must not only achieve a more equitable distribution of goods, but also im- Prove production; it should not destroy the Capitalist system of production without estab- lishing at the same time a socialist organization Which can produce goods at least as effectively.” 'ngeneral, however, Marxists were ill-prepared 7 the task of developing a new economy, as urath (1920) observed with reference to the cauamision on the Socialization of Industry SLalished in Germany in 1918: ‘The technique nc ocilist economy had been badly neglected. wash only criticism of the capitalist society Aeiolfered’s in consequence ‘long-winded, ster- le debates took place, showing disagreements of all sorts,” CRISIS IN SOCIALIST SOCIETY 121 But it was in Russia after 1917 that the prob- lem became most acute, compounded by indust- rial backwardness and the havoc wrought by war, civil war and foreign intervention. In the 1920s, vigorous debates took place, involving particularly Lenin, Bukharin and Preobra- thensky; debates which became increasingly focused, however, on rapid industrialization (Erlich 1960) and on what was called “building, socialism in one country’, until they were ended by Stalin's dictatorship, already foreshadowed in the total dominance of the Communist Party, and his policies of forced INDUSTRIALIZATION and COLLECTIVIZATION. After 1945 this totali- tarian system (see TOTALITARIANISM) was irn- posed on the countries of Eastern Europe (although Yugoslavia began to escape from it in 1950), but after Stalin’s death in 1953 its insta- bility gradually increased, as was shown by a succession of revolts in the 1950s and 1960s. The signs of crisis became still more marked from the beginning of the 1970s and then multi- plied rapidly in the following decade (in China as well as in Europe), culminating in the uphea- vals at the end of 1989 which initiated a radical restructuring of society. The crisis can reasonably be described as ‘general’ in the sense that it profoundly affected the whole social framework - economic, politi- cal, social and cultural. In the economic sphere, the problems of highly centralized planning in more advanced, diversified and changing econo- mies steadily increased (see ECONOMIC PLAN- NING), and the idea of an alternative ‘socialist market economy’ (see MARKET SOCIALISM) was widely debated and vigorously advocated in diverse forms. In the Soviet Union this combina- tion of planning with markets now provides the context in which economic reforms are being undertaken, but in some East European coun- tries there has been a more sweeping rejection of any kind of economic planning and social own- ership by the new regimes, and powerful move- ments to re-establish a capitalist free-market economy have emerged. The political crisis was just as severe, and more immediately important, in the movements of revolt, whose main demands were for the restoration of democracy, free elections, an end to the comniunist monopoly of power and, in particular, the elimination of the ubiquitous secret police forces. The political opposition