Notes – ECOP 2012 Essay

‘THE CAPITALISTIC STATE MUST TRY TO FULFIL TWO BASIC AND

OFTEN CONTRADICTORY FUNCTIONS – ACCUMULATION AND
LEGITIMISATION. THIS MEANS THAT THE STATE MUST TRY TO
MAINTAIN OR CREATE THE CONDITIONS IN WHICH PROFITABLE
CAPITAL ACCUMULATION IS POSSIBLE. HOWEVER, THE STATE
MUST ALSO TRY TO MAINTAIN OR CREATE THE CONDITIONS FOR
SOCIAL HARMONY’

─ James O’Connor, The Fiscal Crisis of the State.

EVALUATE O’CONNOR’S PROPOSITION REGARDING THE DYNAMICS

OF THE CAPITALIST STATE.

Plan

- O’Connor’s claim about the state is correct  the state

manages tenuous balance between providing the operative
conditions for capital accumulation and ensuring the
consolidation of a particular historical bloc

O'Connor, J. 1973, The Fiscal Crisis of the State, St. Martin's Press,
New York.

- Every class and social group want government to spend more

and more money on things amenable to them without paying
new or higher taxes
- Tendency for government expenditure to outrace revenue – the
fiscal crisis of the state:
o Not an iron law but growing needs that only state can
meet create greater claims on the state budget
- Factors that offset the crisis:
o Ignoring the needs of those who require government
provided services  welfare cutback, cutbacks on
subsidies and loans for corporations, freeze wages, raise
taxes, inflation/credit expansion to induce greater tax
- Volume and composition of government expenditure are
historically and structurally determined by conflicts between
classes and groups

Traditional Economics
 - No integrated theory of the economics and politics of public
finance and state finance in mainstream economic thought
- Orthodox public finance theorists are concerned with only
economic effects of tax/expenditure and with the problem of
what the government takes away/provides
o Normative questions of how public enterprise should
conform to preconceived notion of economic optimum
- Absence of integrated theory has compelled economists to
adopt a metaphysical attitude to government spending 
unsatisfactory
o Assumes government expenditure is exogenous to the
economic system
o Merges government expenditure with private
consumption
o Assumes it away altogether
- Orthodox approach is simplistic – economic theorists ignore
actual determinants of state budget, but only estimate the
volume of state spending necessary to effect desired changes
i.e. high employment, growth, rapid accumulation
o Expenditures, programs, budget as a whole can only be
explained in the context of power relationship

Theory of the fiscal crisis

- Theory of economic growth based on relationship between

private and state sectors, private and state spending
- Accumulation and legitimation – mutually contradictory
functions of the state:
o Capitalist state that uses coercive power to help one
class accumulate capital at the expense of other classes
loses legitimacy
o State that ignores necessity of assisting the process of
capital accumulation risks drying up the source of its
own power  economy’s surplus production capacity and
taxes drawn from this surplus
o State must involve itself in the accumulation process but
must mystify its policies or try to conceal them
- State expenditure has twofold character corresponding to
social capital and social expenses:
o Social capital – expenditures required for profitable
private accumulation, it indirectly expands surplus value
  Social constant capital (investment) and social
variable capital (consumption)
 Social investment – projects and services that
increase the productivity of labour power and
increase the rate of profit ceteris paribus
 Social consumption – projects and services that
lower the cost of reproduction of labour and also
increase rate of profit
o Social expenses – projects and services required to
maintain social harmony
 I.e. welfare systems
- Nearly every state agency and expenditure has this twofold
character
o For example, some education spending constitutes social
capital (e.g., teachers and equipment needed to
reproduce and expand work-force technical and skill
levels), whereas other outlays constitute social expenses
(e.g., salaries of campus policemen)
o Few state outlays can be classified unambiguously
- Growth of the state sector and state spending is functioning as
the basis for the growth of the monopoly sector/total
production  at the same time the growth of state spending is
the result of the growth of the monopoly sector
o Socialisation of the costs of social investment and social
consumption capital increases over time  needed for
profitable accumulation by monopoly capital
o Increase in the social character of production prohibits
the private accumulation of constant and variable capital
 specialisation, division of labour, interdependency
o State must meet demands of those who suffer the costs
associated with the rise of the monopoly sector to
maintain legitimacy  unemployment, poverty etc.
- Social investment and social consumption generate private
investment and private consumption
o Supply of social capital creates demand for social
expenses  a model of expanded reproduction which
takes into account socialisation of constant and variable
capital costs and costs of social expenses

Miller, J. 1986, The Fiscal Crisis of the State Reconsidered: Two

Views of the State and the Accumulation of Capital in the Postwar
Economy, Review of Radical Political Economics, vol 18, no 1-2,
pp.236-260.

Introduction

- FCS questions basic proposition of Keynesian economics: that

the form of state expenditures is unimportant and any state
intervention promotes the expansion of capital
o Also questions the idea that expansion of not for profit
state sector is a drain on surplus value
- Disproportionate growth of legitimisation expenditures has
engendered a fiscal crisis of the state that left the state
unable to manage stagflation crisis of the 1970s (237)
- This article argues that current fiscal crisis cannot be
O’Connor’s FCS
o Implausible empirical implications of FCS and invalidity
of social consumption and tax exploitation as theoretical
categories

O’Connor-Wright Analysis

- Orthodox Marxists argue that expansion of the not-for-profit

state is a drag on the accumulation process, even if it can
postpone general crises of capital accumulation
o O’Connor and Wright – Keynesian demand management
policies are more of a mixed bag; some expenditures and
taxes promote accumulation and some do not (237)
- O’Connor – analysis of the state’s ability to socialise costs and
realise profits for the private sector in the Marxist
underconsumption framework of the Monthly Review School
o Monopoly sector, the principle engine of accumulation in
today’ economy, becomes more and more dependent on
the state (238)
- Social investment consists on expenditures on physical
economic infrastructure, R&D, human capital
o Reduces private capital costs and increases rate of profit
- Social consumption – expenditure on welfare and warfare to
legitimate the system
o Help maintain an adequate level of aggregate demand
necessary for capital accumulation)
- Revenue side – burden of taxes have shifted onto the working
class, consumers and small businesses, allowing monopoly
capital to expand its income and wealth
 o Reduces the surplus value absorbing taxation coming
from capital and increases non surplus value absorbing
taxation from labour
- State spending and taxation affect crises in two ways: a)
volume of state spending that augments aggregate demand
and b) indirectly productive accumulation expenditures that
expand the productive capacity of the economy (239)
- Basic question: does the state actually promote accumulation

o Depends on division of government expenditures between

accumulation and legitimisation expenditure and the
extent to which taxation is surplus value absorbing
o The greater the percentage of taxes that are non-surplus-
value absorbing and greater percentage of expenditures
that are indirectly productive (social investment) 
greater the ability of the state to promote accumulation
- Problem of the fiscal crisis is the selective expansion of
unproductive legitimisation expenditures with continued
capital accumulation and the general expansion of the state
 o Keynesian policies become progressively more and more
out of proportion to requirements of accumulation

Testing the Fiscal Crisis of the State

Alternative Marxist Analysis of the State and Capital Accumulation

- Any examination of the state on private profitability must

consider two questions about state expenditures (248):
o Which expenditures are productive of surplus value
 If it commissions the production of, or directly
produces, a commodity which is sold in the market
and has value
 If it employs workers who perform this labour under
the direct control of capital in the productive
sphere of the capitalist sector
o Which expenditures are reproductive of capital, labour
and the economy
 This is a better description that “indirectly
productive” because it does not conflate
reproduction and production of surplus value
- State often acts as a collective consumer to realise surplus
value by purchasing from private capital

O'Connor J 2010, “Marxism and the Three Movements of

Neoliberalism”, Critical Sociology, vol 36, no 5, pp.691-715.
Intro

- Many mainstream accounts of neoliberalism, for example, have

progressed in three distinct directions – considering
neoliberalism as ideology, as policy, and as governance (Larner
2000). Studies document the power and diffusion of free-
market ideas (Babb 2001; Meijer 1987), the global change in
economic policy (Fourcade-Gourinchas and Babb 2002; Taylor
and Pieper 1996), and economic shifts undermining democracy
and instilling worker discipline (Gill 1995; Young 2000). While
scholars have produced important empirical work, illustrating
how neoliberalism is, in fact, an ideology, a set of policies, and
a form of governance, these distinct currents of research have
not been reconciled theoretically. (692)
- Radical analysts generate very different explanations of
neoliberalism. These conceptualizations reflect competing
units of analysis. To illustrate, Howard and King (2002) contend
that neoliberalism is a long-term consequence of the
development of the productive forces, in which advances in
technology are key. For Duménil and Lévy (2004), neoliberalism
represents the ascendancy of financial capital over industrial
capital in the pursuit of profit. In outlining the elements of
‘accumulation by dispossession’, Harvey (2005, 2006)
maintains that neoliberalism is an exercise in the
redistribution and transfer of wealth. Different units of analysis
– be they technology, finance capital, or redistribution – have
produced different meanings of neoliberalism. (692)

Neoliberal transformation

- This state led monopoly capitalism, as described by Fine and

Harris (1979), was marked by the socialization of economic
activity, in which the state took an active role in the
accumulation process. Economic socialization helped offset
the unproductive costs of accumulation and the reproduction
of the labor force (Gough and Eisenschitz 1996). Through a
wide variety of non-market mechanisms, the state balanced
the social nature of production with the private appropriation
of capital. (694)
- Neoliberalism intended to reorder the political economy of
post-war capitalism – modifying its existing class relations, its
 organizing structures, and its institutions of accumulation.
(695)
- With neoliberalism, capital and its agents re-injected market
competition by redefining the boundaries of government
intervention. This was accomplished by replacing the
socialization of economic activity with a new form of coercive
competition. 3 Through the workings of this coercive
competition, there were significant shifts in the relational and
structural power between collective actors and in state-
economy relations. As shown, coercive competition consists of
three distinct yet related processes – state rationalization,
market contestability, and factor mobility. Its logic is such that
the process of state rationalization commands market
contestability, which leads to increased factor mobility, and so
on. Neoliberal coercive competition changes the boundaries of
capital accumulation at the same time as it now regulates
economic activity. (695)
- The first element of coercive competition is state
rationalization. As conceptualized here, state rationalization
refers to the process of, and commitment to, breaking down
the post-war institutional and policy order and attempting to
construct a new one. (696)

Balance of class forces

- The first movement in the neoliberal reordering of capitalism is

the recasting of class relations. In the aftermath of the limited
capital-labor accord and Keynesian state intervention, workers
won higher wages and extensive social protections (O’Connor
2002). To reassert capital’s dominance and help restore
profitability, the balance of class forces was recalibrated in
capital’s direction. This shift in the balance of class forces
meant realigning the class relations involved in both the
production and distribution of surplus value. These conditions,
the actual mechanisms of the employers’ offensive, created
new freedoms for capital and new restrictions on labor. (697)
- Thanks to the cumulative effects of the 1974–5 and 1980–82
recessions and early moves against policy induced ‘labor
market rigidities’, full employment was abandoned in the OECD
in two waves – in the early 1980s and in the early 1990s. Over
the emerging neoliberal period, more people were unemployed
than at any time before, increasing from 30 million in 1983 to
 35 million in 1993 (OECD 1994). By 1996, the year before the
Asian crisis, the official OECD unemployment rate was 7.5
percent – creating a reserve army of 36.4 million (OECD
1998a). (698)
- The change in the balance of class forces under neoliberalism
was related to a number of factors: mass unemployment,
capital flow liberalization, industrial downsizing, and the new
imperialism. Taken as a whole, this recasting of class relations
undermined the social power of organized labor by producing a
downturn in the class struggle: weakening unions’ strategic
importance and in some nations breaking the historic
structure of the workers’ movement (i.e. the unity of union-
party relationships). And, as evidenced by the historic decline
of capital-labor disputes, the stagnation of real wages, and the
retreat of social democracy, the neoliberal recasting of class
relations 700 Critical Sociology 36(5) appeared to have been
successful (ILO 1997–8; Ross and Martin 1999; Scharpf and
Schmidt 2000). (700)

Mode of production

- Under neolberalism, lean production promises increased

productivity, quick reaction to changing market demands, and
a reduction in worker resistance. Relying on consumer
feedback, lean production identifies and serves various market
niches, meeting consumer needs and shifts in public demand
(Smith 1994). By offering a greater range of products, firm
inventories are smaller, and at the point of production, work
activity is organized in such a way that all practices that did
not add value would be eliminated (Hampson 1999). This
stressful state of ‘constant improvement’ removes excessive
set-up time and inventory, as well as production rigidity that
hinders switching from one product line to another. Cost
reduction and flexibility are established through ‘just-in-time’
delivery, job rotation, multifunctional machinery, and the use
of teams (Moody 1997). In terms of organization, lean
production relies on ‘production chains’, in which suppliers,
assemblers, and distributors are separated by time and space
yet are bound together (Moody 1997). Through ‘sub-contracting’
and ‘outsourcing’, capital can take advantage of cost, policy,
and institutional advantages within different nations. (702)
 - There was both change and continuity in the forms of
appropriation under neoliberalism. While enterprise profits
remained central, a new form of appropriation slowly
developed – ‘financialization’. With the breakdown of the post-
war system of fixed exchange rates, worldwide high interest
rates, and the lack of profitable industrial investment
opportunities, a host of new valorization possibilities emerged
for profitseeking money capital. Financialization, the
immediate realization of profits based on the anticipated
creation of surplus value, utilizes surplus liquidity without the
high risks/uncertainty and low yield of productive investment.
(702)
- Two points need to be noted. First, at the level of the mode of
production, the relationship between the state and capital
changed. The retreat from the socialization of economic
activity and the embrace of coercive competition enabled
capital to spread its tentacles across state boundaries. In
terms of productive techniques, forms of appropriation, and
the manner of reproduction, capital is now free to merge, make
alliances, and form partnerships with other capitals and states
in pursuit of profit. Under neoliberalism, the logic of
profitability is such that there are now networks of multiple
capitals and multiple states. Second, the relationship between
state and labor has changed as the mode of production has
been altered. With the production, appropriation, and
reproduction of surplus value dependent upon the interaction
of a number of capitals and states, it is difficult for labor to
turn to a state/employer and demand concessions. In terms of
the organizing and reproducing structures of the mode of
production, neoliberalism is not the same capitalism as that of
the ‘Golden Age’ post-war period. (704)

Fine, B. and Saad-Filho, A. 2016, Thirteen Things You Need to Know

About Neoliberalism, Critical Sociology, vol 43, no 4-5, pp.685-706.

- Under neoliberalism state institutions intervene upon and

through markets and other institutions in specific ways that
tend to extend and/or reproduce neoliberalism itself.18 Exactly
the same is true of other systems of accumulation, not least
those attached to the Keynesian, developmental or Soviet-type
states that are presumed to have been more interventionist.19
 In all these cases, the roles of ‘the state’ and ‘the market’
(unduly undifferentiated) cannot be usefully identified through
their simplistic opposition. Instead, the relevant patterns of
accumulation, restructuring and social and economic
reproduction can be understood only through relatively
concrete and historically specific analyses. These must
include the interaction, contestation and co-operation among
specific institutions within, across and beyond that putative
divide. Those processes are themselves heavily influenced and
contested by, but not reducible to, the underlying economic,
political and ideological (class) interests that are formed and
act upon and through such institutions. In practice, then, first,
much has been achieved through state provision in the past,
and this has itself become the basis for privatization, for
example, in terms of availability of productive facilities. The
scope for such achievements can only have been enhanced
over time through improved technological capabilities and new
management techniques. Yet, these successes are rarely if
ever recognized, while public provision is invariably and
arbitrarily deemed to be inferior to private provision, often on
the basis of casual or flawed studies that rarely even consider
firm and market structure, finance, degree of monopoly and so
on (Bayliss and Fine, 2008). Second, state intervention has
been transformed rather than simply ‘reduced’ under
neoliberalism (see sixth thing). Currently, while the overall
logic of state policies and interventions remains to promote
economic and social reproduction and the restructuring of
capital, the interests and role of finance have increasingly
come to the fore either directly or indirectly. Such is evident,
for example, from the policy responses to the global crisis and
the continuing recession; but it is equally characteristic of the
policies implemented over the entire neoliberal period, as the
interests of private capital in general and of finance in
particular have been favoured by the state (see eighth thing).
- The neoliberal ‘policy reforms’ implemented through
Reaganism, Thatcherism and the (post-) Washington
Consensus are supported by five ontological planks.25 First is
the dichotomy between markets and the state, implying that
these are rival and mutually exclusive institutions. Second is
the assumption that markets are effective if not efficient while
 state intervention is wasteful because it distorts prices and
misallocates resources in comparison with what an ideal
market would have done, induces rent-seeking behaviour and
fosters technological backwardness. Third, the belief that
technological progress, the liberalization of finance and capital
movements, the systematic pursuit of ‘shareholder value’ and
successive transitions to neoliberalism around the world have
created a global economy characterized by rapid capital
mobility within and between countries and (an ill-defined
process of) ‘globalization’. Where they are embraced, rapid
growth ensues through the prosperity of local enterprise and
the attraction of foreign capital; in contrast, reluctance or
‘excessive’ state intervention (however it may be determined)
drives capital, employment and economic growth elsewhere.
Fourth, the presumption that allocative efficiency,
macroeconomic stability and output growth are conditional
upon low inflation, which is best secured by monetary policy at
the expense of fiscal, exchange rate and industrial policy tools.
Fifth, the realization that the operation of key neoliberal
macroeconomic policies, including ‘liberalized’ trade, financial
and labour markets, inflation targeting, central bank
independence, floating exchange rates and tight fiscal rules, is
conditional upon the provision of potentially unlimited state
guarantees to the financial system, since the latter remains
structurally unable to support itself despite its escalating
control of social resources under neoliberalism

Barrow, C. 1993, Critical theories of the state, University of

Wisconsin Press, Madison, WI.

Plain Marxism: The Instrumentalist Approach

- The most succinct statement of instrumentalist theory is Paul

Sweezy's assertion that the state is "an instrument in the
hands of the ruling class for enforcing and guaranteeing the
stability of the class structure itself." 2 The basic thesis of the
instrumentalist approach is that modern capitalists are able to
formulate public policies which represent their long-term class
interests and to secure the adoption, implementation, and
enforcement of those policies through state institutions. Thus,
instrumentalist theory offers a straightforward and simple
 claim that the modern state serves the interests of the
capitalist class because it is dominated by that class. (13)
- A key methodological assumption of power structure analysis
is that patterned distributions of key resources institutionalize
the levels of power that specific individuals can potentially
deploy against other individuals or that they can deploy in
realizing their objectives at any given time and place.5 The
research agenda generated by this analytic framework is
driven by the further assumption that one can develop
empirical maps of a power structure by measuring the relative
degrees of power controlled by different groups of individuals.
Relative amounts of power are indicated by the degree to
which those who control a particular resource (e.g., wealth)
are able to monopolize (1) the control of that key resource
which defines them as a social group, and (2) the control of
other key resources that potentially supply other groups with
competing sources of power. (14)
- The Principle of Commodification refers to the idea that in
capitalist societies all use values are potentially convertible to
exchange values. As a historical phenomenon,
commodification is the tendency of the capitalist mode of
production to extend market relations to a wider and wider
range of social phenomena, thus making it possible to convert
capital (i.e., money) to other types of use values.ll The
importance of this principle to a theory of the state is its
implication that wealth and income (i.e., capital) are always a
potentially generalizable source of power in capitalist society.
Capital is convertible to other forms of power to a degree that
is not true of social status, political influence, or knowledge.
(15)
- The General Law of Capitalist Accumulation simply refers to
the historical tendency for capital and other productive assets
to become concentrated and centralized in the hands of fewer
and fewer individuals in the regular course of capitalist
economic development.13 Thus, if one combines the Principle
of Commodification with the General Law of Capitalist
Accumulation, one would expect that, as a consequence of its
control of capital, the capitalist class will have a greater
relative capacity to deploy an array of power resources on its
own behalf under normal circumstances. As a result, there is a
 theoretical expectation that other sources of power will be
pulled into the orbit of the capitalist class in one of two ways.
Capital can be converted to direct control of other resources
(e.g., state offices and higher education), or it can be used to
influence those who control other resources (e.g., campaign
contributions, consultant positions, and research grants). (16)
- Thus, a key issue in contemporary power structure research is
whether or not corporate elites have a capacity to formulate
their general class interests and to act then as a coherent
organizational entity in pursuit of those interests. As Beth
Mintz observes, this challenge has required more recent
studies of the internal structure of the u.s. capitalist class to
"concentrate on one organizing question: are there
mechanisms for cohesion capable of transforming a series of
important actors into a unified social class?" 24 The primary
thrust of this research has been to evaluate the potential for
coordinated action among corporate elites on the basis of,
first, shared economic interests and, second, a set of common
social experiences and cultural values. The first type of
research is called positional analysis, and the latter is called
social analysis. (18)
- Positional Analysis
o The most common model of u.s. capitalist class
formation is based in a concept of financial groups. Paul
A. Baran and Paul Sweezy define a financial group as a
"number of corporations under common control, the
locus of power being normally an investment or
commercial bank or a great family fortune." 25 Private
corporations, such as banks, industrial firms, and
commercial enterprises, are governed by boards of
directors elected by shareholders. The board of directors
exercises the proprietary, or ownership, function of the
corporation. Directors have the legal authority to make
decisions concerning wages, working conditions, and
terms of employment in the corporation, to establish
capital investment policies, to set goals for profitability,
product prices, and decide virtually any other matter
related to the disposition of a corporation's assets.
Interlocking directors are individuals who simultaneously
sit on two or more corporate boards of directors. An
 interlocking directorate is said to exist whenever a
stable network of interlocking directors is identified
among a specific group of corporations.27
o It is hypothesized that interlocking directorates provide a
linking mechanism for intercorporate coordination and
planning in the monopoly capital sector. Second, it is
theoretically plausible to infer that interlocking directors
are more likely than their noninterlocking counterparts to
"think in terms not only of the narrow interests of the
individual corporation but also of the good of the class as
a whole." 28 This is because their position within the
corporate network is tied simultaneously to several
different companies that often represent several
different industries. Thus, interlocking directors are much
more likely than other elements of the corporate elite to
be the agents of classwide interests. The intercorporate
agent established by interlocking directorates is often
referred to as finance capital. (19)
- Social analysis:
o Power structure analysts do not regard ∙financial groups
and the economic interests constituted by them as the
only factors promoting cohesion within the u.s. capitalist
class. The substructural mechanisms of class cohesion
are reinforced by a variety of noneconomic status
linkages, cultural affiliations, and social interactions.
Social analysis is a subfield of power structure research
that involves the study of status indicators and their
association with members of the capitalist class. Quite
simply, social analysis seeks to answer whether or not
the capitalist class is also an "upper" class. (22)
- One of the most direct indicators of ruling-class domination is
the degree to which members of the capitalist class control
the state apparatus through interlocking positions in the
governmental, administrative, coercive, and ideological
apparatuses. Positional control of the state apparatus is
particularly important in instrumentalist theory~ because the
theory locates state power within the state system's
institutional apparatus. As Miliband emphasizes: "It is these
institutions in which 'state power' lies, and it is through them
that this power is wielded in its different manifestations by the
people who occupy the leading positions in each of these
 institutions." 50 For this reason, according to Miliband,
instrumentalists attach considerable importance to the social
composition of the state elite. The class composition of a
state elite creates "a strong presumption ... as to its general
outlook, ideological dispositions and political bias" in the way
it will wield state power.51 (25)
- From this perspective, one way to measure the degree of
potential class domination is to quantify the extent to which
members of a particular class have colonized the state
apparatus. One measures the colonization process simply by
counting heads, namely, by quantifying the degree to which
the means of political decision-making are controlled by
members of a particular class. Thus, an analysis of the
colonization process seeks to find out whether or not members
of the capitalist class also hold most of the decision-making
positions in the state apparatus; that is, does the class which
wields economic power also control state power? (26)
- Contrary to often-made assertions, adherents of
instrumentalist theory have considered the process of
colonization an important one, precisely because they begin
with the explicit presumption of an analytic separation of
class and state. As Domhoff has recently pointed out, the
basic assumption of power structure research is that the state
"might well be independent of the upper class and the big-
business community; otherwise, all the empirical digging,
network tracing, and content analysis that constitutes the
field of power structure research makes no sense whatsoever
theoretically." 54 Likewise, Miliband agrees that "the first step
in the analysis is to note the obvious but fundamental fact that
this [capitalist] class is involved in a relationship with the
state, which cannot be assumed in the political conditions
which are typical of advanced capitalism," namely, political
democracy.55 (26)
o The analytic autonomy of the state means that, from the
instrumentalist perspective, any relationship between
class. and state is a historically contingent one. As
Domhoff further observes: "What this means empirically
is that there can be no general theory of the relationship
between state and ruling class"; that is, the state in
capitalist society is not necessarily either capitalist or
 democratic.56 Consequently, it becomes theoretically
important to know who actually controls state power at
any given time. Moreover, it is the autonomy of the state
as a separate power source that opens up the theoretical
possibility that noncapitalist classes might actually
"seize" state power under certain circumstances,
whether through elections or revolution, and then be able
to deploy that power against the capitalist class.
- Miliband has attempted to explain the coherence of the state
system by suggesting that its operational unity is primarily
ideological, that is, a state of mind. He argues that most state
elites, including those who are not members of thecapitalist
class, "accept as beyond question the capitalist context in
which they operate." Consequently, their views on public
policy "are conditioned by, and pass through the prism of, their
acceptance of and commitment to the existing economic
system." In Miliband's account, the ideological commitments
of state elites and state managers are of "absolutely
fundamental importance in shaping their attitudes, policies
and actions in regard to specific issues and problems with
which they are confronted." The result of their underlying
ideological unity is that "the politics of advanced capitalism
have been about different conceptions of how to run the same
economic and social system." (29)
o Two additional problems surface for instrumentalist
theory. First, theoretical treatments of the state have too
often assumed that those capitalists who serve as state
elites have a coherent political vision.64 However, if this
claim is to be anything more than mere assertion,
specific mechanisms must again be identified that
facilitate political class consciousness by capitalists.
Moreover, if capitalists are class conscious, then one
should also be able to identify and reconstruct their
specific political ideology.
o Second, instrumentalist theory must likewise account for
the procapitalist nature of the state managers'
ideological commitments. Miliband nominally resolves
the second problem by reference to the workings of an
ideological system. The ideological system is an
institutional matrix that includes the state's ideological
 apparatus (i.e., schools and universities) and private
institutions such as churches, the mass media, and other
opinion-shaping networks. As with the economic and
state systems, the ideological system's command
positions are colonized by the capitalist class.65
Miliband considers the ideological system, particularly
the state's ideological apparatus, an important
mechanism for socializing state managers, especially
because higher educational credentials are a stringent
requirement for holding advisory, policyanalysis, or
decision-making positions in the administrative and
coercive apparatuses. Likewise, many of the most
important positions in state management require
applicants to pass confidential security checks.

Neo-Marxism: Structuralist Approach

- Because of this underlying tendency toward crisis,

structuralists argue that the state must intervene politically to
maintain economic stability and to mediate class struggles in
capitalist societies. The structuralist thesis, as summarized by
Ernest Mandel, is that the function of the state is to protect
and reproduce the social structure of capitalist societies (i.e.,
the fundamental relations of production) insofar as this is not
achieved by the automatic processes of the economy.2
Consequently, structuralists argue that state policies and
state institutions are best understood by their "function" in
maintaining the capitalist system. The main goal of
institutional and policy analyses informed by a structuralist
approach is to analyze how the effects of state institutions and
state policies operate to fulfill this general maintenance
function.3 (51)
- However, structuralists note that as a result of its internal
development, various "contradictions" are constantly at work
within the system to generate crises of capital accumulation
and simultaneously to undermine ruling class domination.
While there remains a great deal of debate among
structuralists concerning the exact nature and source of these
contradictions, most theorists identify one or all of three
possible factors as the source of crises: (1) economic crisis,
(2) class struggle, and (3) uneven development? (52)
- In this regard, the structural effects of crisis tendencies are
visible in the social dislocations that disrupt the functional
stability of all capitalist social formations. Whether one
identifies the contradictions of capitalism with structural
economic crises, class struggle, uneven development, or a
combination of all three factors, it is the ever-present
phenomena of crisis that, for structuralists, raises the
question of how the reproduction of capitalism is even
possible for any extended length of time. The structuralist
answer to this puzzle is that in a capitalist social formation the
state functions as "the regulating factor ofits global
equilibrium as a system." 14 Poulantzas suggests that the
state fulfills a general maintenance function by "constituting
the factor of cohesion between the levels of a social
formation." (54)
o First, Poulantzas argues that contrary to the mythology of
neoclassical economic theory, the economic level of
capitalist societies has never "formed a hermetically
sealed level, capable of self-reproduction and possessing
its own 'laws' of internal functioning." Rather, the
economic level of capitalist societies is only relatively
autonomous of the other levels. Consequently, he argues,
"the political field of the State (as well as the sphere of
ideology) has always, in different forms, been present in
the constitution and reproduction of the relations of
production." (54)
o Quadagno claims that state policies contribute to the
reproduction of labor power and the means of labor partly
by mediating disputes between antagonistic classes and
between competing fractions of capital. The state
preserves the capitalist system as a whole by effecting
compromise policies which yield unequal benefits to the
politically dominant power bloc in a capitalist society,
but it also confers on workers real tangible benefits that
are necessary to the reproduction of labor power (e.g.,
education, family allowances). Hence, according to
Quadagno, the structuralist concept of political power"
can be [empirically] derived by analyzing how state
managers respond to different power blocs, by examining
the existing economic and political constraints unique to
 a particular period and to a particular state action, and
by assessing how working-class demands get
incorporated into social policy." 20 (55)
o Third, Poulantzas clearly accepts the principle of uneven
development as an important structural element of state
institutions and state policies. Poulantzas maintains that
uneven development within capitalist societies results in
an unstable equilibrium between the economic, political,
and ideological instances. As a result, Poulantzas argues
that (HIe) "this [structural] equilibrium is never given by
the economic as such, but is maintained by the state." 21
The state must often intervene with policies or
institutional reforms in order to reestablish equilibrium
between the various levels. Thus, for example, the state
might initiate curriculum reform in public schools, such
as computer literacy or engineering scholarships, to
bring the ideological level into a time sequence that
corresponds to the functional requirements of capitalist
accumulation. (55)
- The modalities of the state function are always implemented
through three functional subsystems of the state: the judicial
subsystem, the ideological subsystem, and the political
subsystem. Poulantzas argues that in capitalist societies the
judicial subsystem is constituted as a set of rules which
facilitate market exchanges by providing a "framework of
cohesion in which commercial encounters can take place"
(e.g., property and contract law, fair business practices, etc.) .
25 The state's ideological subsystem functions primarily
through public educational institutions, and the strictly
political subsystem consists of institutions engaged in "the
maintenance of political order in political class conflict" (e.g.,
electoral laws, the party system, law enforcement).26 The
state's modalities each constitute political functions insofar
as their operational objective is the maintenance and
stabilization of a society in which the capitalist class is the
dominant and exploitative class. As Poulantzas notes, "it is to
the extent that the prime object of these functions is the
maintenance of this unity that they [i.e., the functions and
their modalities] correspond to the political interests of the
dominant class." 2 (56)
 o It should be emphasized as a point of considerable
methodological significance that structures (i.e., the
levels of capitalist society) are not reducible to the
economic, political, or ideological institutions that
compose them.28 On this point, David Gold, Clarence Lo,
and Erik Olin Wright observe that the concept of
"structure does not refer to the concrete social
institutions that make up a society, but rather to the
systematic functional interrelationships among these
institutions." Hence, a structural analysis consists of
more than a narrative history of a particular institution or
an analysis of the policy-formation process. It requires
one to identify "the functional relationship of various
institutions to the process of surplus-value production
and appropriation." (57)

Concept of the State

- The functional necessity of policy conjunctures between state

power and capitalist interests is a postulate derived from an
analytic distinction between the concepts of state power and
the state apparatus.31 Poulantzas defines state power as the
capacity of a social class to realize its objective interests
through the state apparatus.32 Thus, Jessop observes that
"state power is capitalist to the extent that it creates,
maintains, or restores the conditions required for capital
accumulation in a given situation and it is non-capitalist to the
extent that these conditions are not realised." 33 In this
respect, the objective effects of state policies on capital
accumulation and the class structure are the main indicators
of state power.34 (57)
o On the other hand, the state apparatus is identified with
two relations that are analytically (though not
functionally) distinct from state power. Poulantzas
defines the state apparatus as: "(a) the place of the state
in the ensemble of the structures of a social formation,"
that is, the state's functions, and "(b) the personnel of
the state, the ranks of the administration, bureaucracy,
army, etc." 35 The state apparatus is thus a unity of the
effects of state power (i.e., policies) and the network of
 institutions and personnel through which the state
function is executed.36
o The functional unity between state power and the state
apparatus is emphasized by Poulantzas with the
observation "that structure is not the simple principle of
organization which is exterior to the institution: the
structure is present in an allusive and inverted form in
the institution itself." 37 This indicates that for
Poulantzas the concept of the state apparatus
intrinsically includes the functions executed through
state institutions and by state personnel. Hence, unlike
instrumentalist or organizational theorists, structuralists
have generally insisted that the concept of state power is
not reducible merely to governmental institutions and
state personnel. Quite the contrary, Poulantzas argues
that "the institutions of the state, do not, strictly
speaking, have any power." 38 Bob Jessop echoes this
view with his observation that "the state is a set of
institutions that cannot, qua institutional ensemble,
exercise power. (57) Jessop notes that an important
implication of this view is that neither the state nor state
elites should be seen as historical agents capable of
exercising political power toward noncapitalist
objectives.41 (58)
- It is from this methodological perspective that Poulantzas and
other structuralists criticize the instrumentalist approach to
the state. Poulantzas concludes that if state institutions are
not seen as the repository of state power, but merely as
structural channels for the realization of its effects, then the
direct participation of members of the capitalist class in the
state apparatus, even where it exists, is not the most
important aspect of political analysis. Rather, as Poulantzas
claimed in his famous debate with Ralph Miliband, "if the
function of the state in a determinate social formation and the
interests of the dominant class in this formation coincide, it is
by reason of the system itself: the direct participation of
members of the ruling class in the state apparatus is not the
cause but the effect, and moreover a chance and contingent
one, of this objective coincidence." (58)

Functional Constraint
- Consequently, if structuralism is to avoid the worst kind of
functionalist metaphysics, it must be able to specify a
structural mechanism that requires the state to function
automatically as a capitalist state even though capitalists do
not directly hold most, or sometimes any, governmental
offices.4 (58)
o The state necessarily serves the interests of the
capitalist
class, because the state's own fiscal functioning is
immediately dependent on the economy.
- Two sources of fiscal dependency:
o First, Block notes the state's tax capacity is dependent
on the overall performance of the economy. When the
economy slows down or declines, the state will have
difficulty maintaining adequate revenues to finance its
own operations.46 When the economy is growing, the
state can generate revenues with much less tax effort
and, thus, with much less resistance from business or the
public. Second, Ernest Mandel has consistently
emphasized that all modern capitalist states rely on
shortterm borrowing and long-term deficit financing as
regular components of public budgeting. Consequently,
he argues, escalating public debt increasingly forges "a
golden chain" between state and capital, because no
government could last more than a month without
knocking on the doors of the major banks.47 (59)
o The state necessarily serves the interests of the
capitalist class, because the state's legitimacy is
dependent on the economy.48 Citizens generally view the
state's personnel and policies as being responsible for
their economic prosperity or lack thereof. Consequently,
during economic downturns support for a regime
declines. In democratic states, the party in power is
likely to be ousted in the next election because of its
poor economic performance, and in nondemocratic
countries rising opposition may destabilize a regime if
poor economic conditions persist for too long.
Paradoxically, the ease with which party regimes can be
ousted in most democratic countries may well make
democratic states more responsive to the needs of
 capitalists and, hence, make democracy what Lenin
called "the best possible shell" for a capitalist state. (59)
- The concept of "capital flight" is a key element in structural
theory that greatly clarifies the structuralist distinction
between state power and the state apparatus. As used by
Bridges, Block, and Lindblom, the explanatory power of the
capital flight concept is that it reinforces Poulantzas's claim
that political power is constituted outside the state apparatus
in capitalist relations of production, namely, in the private
control of productive assets.51 Moreover, as Bridges
concludes, such a concept makes it "impossible to conceive of
a state functioning against the interests of the bourgeoisie ...
short of removing the basis of their power, that is, control of
the means of production." (60)

Form Analysis

- Structuralists have frequently suggested that historical

variations in the functional structure of capitalist states can
be analyzed along two axes. First, capitalist states tend to
develop different forms of intervention in the economy, such as
mercantilism, minimalism, and welfarism, with each emerging
during different phases of capitalist development. Second,
capitalist states demonstrate wide variations in the forms of
representation that institutionalize the alliance between state
and capital. (64)
- The problems of defining a structuralist politics are best
understood in terms of two dilemmas: the asymmetry of the
state apparatus and the separation of state power from the
state apparatus. Most structural theorists would argue that
the existing state apparatus cannot simply be "seized" or
captured by the working class as an instrument of transition
because (1) the existing form of state power functions against
noncapitalist interests, and (2) the state apparatus has no
power, but merely channels the social power constituted in
relations of production. The idea that forms of representation
institutionalize asymmetrical distributions of political power
suggests that working-class parties cannot establish their
political dominance simply by seizing an existing state
apparatus. (69)

The Derivationist Approach

 - The primary methodological axiom of the derivationist
approach is that the analysis of the relation between state and
society must be deduced from contradictions inherent in the
capitalist mode of production. 4 The rationale for this axiom is
that if capitalism were in fact spontaneous, self-regulating,
and self-sustaining as an economic system, then there would
be no logical rationale for state action in relation to capital
accumulation. Therefore, derivationists posit the state as a
logically necessary instance of capitalist society that must
perform for the capitalist class those tasks which it inherently
cannot perform for itself.5 These tasks, whatever their nature,
define the general interests of the capitalist class. (78)

Barrow C 2016, Toward a Critical Theory of States: The Poulantzas-

Miliband Debate after Globalization, State University of New York
Press, Albany.

Poulantzas v Milliband

- The most succinct summary of Ralph Miliband’s (1969, 23)

theory of the state is that: “In the Marxist scheme, the ‘ruling
class’ of capitalist society is that class which owns and
controls the means of production and which is able, by virtue
of the economic power thus conferred upon it, to use the state
as its instrument for the domination of society.” (22)
- Otherwise, as Miliband describes it, the modern state system
in capitalist societies is a vast and sprawling network of
political institutions loosely coordinated, if at all, through
mechanisms that provide a tenuous cohesion at best.
Importantly, for Miliband, the diffuseness of the state system
in capitalist societies also means that the conquest of state
power is never an all or nothing proposition, because it is—in
the Gramscian phrase—a war of fixed position, waged on many
fronts, in many trenches, with shifting lines of battle, where
victories and successes occur side by side on the same day.
The conquest of state power is never absolute; it is never
uncontested; and it is never complete, because it is an on-
going and contingent political struggle. 13 Hence, Miliband’s
concept of the state requires an analysis and understanding of
state power that always refers to particular historical
circumstances and to institutional configurations that may
vary widely from one capitalist society to another, and where
 over time class hegemony may shift in one direction or another
within the same society. Indeed, Miliband (1969, 77) is quite
explicit in pointing out that state elites “have in fact been
compelled over the years to act against some property rights,
to erode some managerial prerogatives, to help redress
somewhat the balance between capital and labour, between
property and those who are subject to it.” (29)

Poulantzas Theory of the State

- In direct contrast to what he calls the “historicist conception”

of class practice, Poulantzas (1978a, 66) argues that
“relations of production as a structure are not social
classes . . . capital and wage-labour are not, of course, the
empirical realities of ‘capitalists’ and ‘labourers’.” Instead, for
Poulantzas (1978a, 66), the relations of production: . . .
consist of specific forms of combination of the agents of
production and the means of production. This structure of
relations of production “determines the places and functions
occupied and adopted by the agents of production, who are
never anything more than the occupants of these places, in so
far as they are supports of these functions.” (31)
- Thus, Poulantzas can never regard the main tasks of Marxist
political theory as empirical or historical, because such
analyses in his framework confuse the agents of
production (i.e., groups of individuals) with the structural-
functional relations that determine social class. Individuals
“support” and “carry out” various functions within temporal
history, but these functions are in no way dependent upon
particular individuals or groups of individuals. Hence, even
before the publication of Miliband’s The State in Capitalist
Society, Poulantzas (1978a, 62) was dismissing the historicist
conception of class practice as one that: . . . leads ultimately
to the establishment of an ideological relation between
individuals/agents-of-production (“men”) and social classes;
this relation is given a theoretical foundation in the status of
the subject. agents of production are perceived as
agents/producers, as subjects which create structures; and
social classes are perceived as the subjects of history. (31)
- The contradictory effects of class practices on the equilibrium
of the capitalist system means that immanent crisis
 tendencies are always disrupting the functional stability of the
capitalist mode of production. Thus, the basic structure of the
capitalist mode of production generates contradictory class
practices, dislocations, and crisis tendencies, and it this
inexorable disruption of the capitalist system that
necessitates a separate structure to specifically maintain,
monitor, and restore its equilibrium as a system. Although
Poulantzas (1978, 45) modifies structural-functionalism by
introducing class practices as a disequilibrating mechanism,
nevertheless, he was clearly indebted to mainstream a
merican functionalists and systems theorists insofar as he
argues that the general function of the state in the capitalist
mode of production is to serve as “ the regulating factor of its
global equilibrium as a system .” (34)
- In particular, Poulantzas identifies three ensembles of class
practices that require regulation by the state in order to
maintain and restore the equilibrium of the capitalist system.
First, Poulantzas argues contrary to the mythology of neo-
classical economic theory, that the economic level of the
capitalist mode of production has never “formed a hermetically
sealed level, capable of self-production and possessing its own
‘laws’ of internal functioning.” Rather, the economic level of
the capitalist mode of production is only relatively
autonomous from the political and ideological levels, but given
this relative autonomy, Poulantzas (1978, 45) concludes that
structural “equilibrium is never given by the economic as
such, but is maintained by the state.” To this extent, the state
fulfills a general maintenance function “ by constituting the
factor of cohesion between the levels of a social formation ”
(Poulantzas 1978a, 44). (35)
- The operational objectives of state policy are realized through
three “modalities of the state function.” The modalities of the
state function identify the structural levels in which the
effects of state policies are realized: (1) the technico-
economic function at the economic level, (2) the political
function at the level of class struggle, and (3) the ideological
function at the cultural level. (35)
- The differences between Miliband and Poulantzas
concerning the importance of institutions initially appear to be
much more than a mere difference in emphasis or theoretical
 focus. Miliband and Poulantzas each articulate competing
concepts of state power that are linked inextricably to their
methodological differences. Whereas Miliband articulates an
institutionalist conception of power, anchored by the
methodological (Weberian) assumptions of power structure
research, Poulantzas articulates a functionalist conception of
power anchored by the methodological (Parsonian)
assumptions of systems analysis and structural functionalism.
Notably, and in direct contrast to Miliband, Poulantzas draws a
sharp analytic distinction between the concepts of state
power and the state apparatus (Therborn, 1978, 148). (37)
- Poulantzas (1978a, 104) defines state power as the capacity
of a social class to realize its objective interests through the
state apparatus. Bob Jessop (1982, 221) lends greater
specificity to this idea by observing that within this framework
“state power is capitalist to the extent that it creates,
maintains, or restores the conditions required for capital
accumulation in a given situation and it is non-capitalist to the
extent these conditions are not realised.” In this respect, the
objective effects of state policies on capital accumulation and
the class structure are the main objective indicators of state
power. 29 (37)
- State apparatus:
o “(a) The place of the state in the ensemble of the
structures of a social formation,” that is, the state’s
functions and “(b) The personnel of the state , the ranks
of the administration, bureaucracy, army, etc.” The state
apparatus is thus a unity of the effects of state power
(i.e., policies) and the network of institutions and
personnel through which the state function is executed.
(38)
- Ideology historically dismissed in Marxist theories of the state
as epiphenomenal (as opposed to constitutive) of social and
political relations – ideology equated with ideas, customs,
morals (rather than embedded in institutions which belong to
the State:
o Ideology brought into the realm of the state by
conceptualising the state as a dual matrix of
apparatuses that perform repressive and ideological
functions (43)
 - Poulantzas argues that state institutions, as such, do not have
any power, but must be related only to social classes which
hold power. However, Miliband (1973, 87) observes that if the
state does not have any independent source of power, “this,
inter alia, is to deprive the state of any kind of autonomy at all”
and, for all practical matters, conceptualizes the state out of
existence in everything but name only. Thus, aside from being
a self-contradictory and self-defeating theoretical position,
Miliband insists that one has to make a distinction between
class power and state power, not only because it is necessary
to conceptualize the state as relatively autonomous, but
because it is also necessary to recognizing that while state
power may be the main and ultimate means of maintaining
ruling class domination, it is not the only form of class power.
(50)

Poulantzas v Althusser

- Miliband criticised Poulantzas for his “structural super-

determinism,” because the latter seemed to claim that state
elites and state institutions automatically respond to the
functional imperatives of the capitalist system to such an
extent that there is no place for personal ideological beliefs,
party affiliations, political institutions, or even class struggle
in a theoretical analysis of the capitalist state (King, 1986, 77).
2 Moreover, in a subsequent critique, Miliband condemned the
“structuralist abstractionism” of Poulantzas’ analytical
method, which seemed to favor the elaboration of abstract
concepts over empirical, historical, and institutional analyses
of actually existing states. (104)
- The epistemological and methodological differences between
Poulantzas and the other structuralists manifest themselves
more explicitly after 1968, mainly because Poulantzas shifts
the focus of his epistemological critique from historicism and
voluntarism (e.g., C. Wright Mills) to what he called formalism
(e.g., Balibar) and economism (e.g., Therborn) (Benton, 1984,
13). In Political Power and Social Classes , Poulantzas’ (1978,
11, 37– 40) epistemological criticisms are directed mainly
against the major variants of Marxist “historicism,” that is,
Lukacs, Korsch, Labriola, and Gramsci. After the publication of
The State in Capitalist Society - - (1969), Poulantzas
 immediately iden tified Miliband as a contemporary exemplar
of Marxist histor icism, which (if inaccurately) put him directly
in the crosshairs of Poulantzas’ epistemological critique. (107)
- Thus, in Fascism and Dictatorship , Poulantzas begins more
explicitly to differentiate his position from Althusser’s on two
points that he would elaborate in subsequent works in much
greater detail. First, Poulantzas (1974, 300– 301 fn. 2) argues
that Althusser’s (1978) widely acclaimed essay on ideological
state apparatuses “suffers to some extent from both abstract -
edness and formalism: it does not give the class struggle the
place it deserves.” 13 Second, Poulantzas (1974, 303 fn. 5)
claims that Althusser badly underestimates “the economic role
of the State apparatuses, to the extent of completely
neglecting it theoretically” in his famous formula: The State =
Repression + Ideology. (109)
- Poulantzas (1980, 15) identifies the main limitation of the
formalist-economist position with its assumption that “the
economy is composed of elements that remain unchanged
through the various modes of production— elements
possessing an almost Aristotelian nature or essence and able
to reproduce and regulate themselves by a kind of internal
combinatory.” It views the economic instance, as well as the
statepolitical instance, as a fixed set of structural relations
between essentially immutable forms. Poulantzas (1980, 15)
correctly criticizes “the formalist position” for conceptualizing
modes of production: . . . in the form of instances or levels that
are by nature or by essence autonomous from one another.
Once the economy is apprehended in terms of a series of
elements occupying their own spaces and remaining
unchanged through the diverse modes of production (slavery,
feudalism, capitalism), the conception will be extended by
analogy to the superstructural instances a posteriori
combination of these inherently autonomous instances that
will produce the various modes of production, since the
essence of these instances is prior to their mutual relation
within a mode of production. (the State, ideology). It is then
the a posteriori combination of these autonomous instances
that produce the various modes of production, as the essence
of these instances is prior to their mutual relation within a
mode of production. (113)
 o A second major flaw with this theoretical position, as Pou
- lantzas (1980, 15) notes, is that it “obscures the role of
strug - gles lodged in the very heart of the relations of
production and exploitation.” In State, Power, Socialism,
Poulantzas (1980, 16) reiterates a point he had made with
equal vigor in Political Power and Social Classes : These
conceptions also have an effect on the delimita - tion and
construction of objects for theoretical investigation for
they both admit the possibility and legitimacy of a
general theory of the economy taken as an
epistemologically distinct object— the theory, that is to
say, of the transhistorical functioning of the economic
space. In this perspective, the differences presented by
the object (the economy) from one mode of production to
another are to be explained purely in terms of a
selfregulating and rigidly demarcated economic space,
whose internal metamorphoses and transformations are
unraveled by the general theory of the economy
(“economic science”).
- Furthermore, Poulantzas observes that at the superstructural
levels, the formalist-economist position diverges into two
distinct structuralisms that he considers equally flawed. The
formalist variant— what is properly called structuralist
abstractionism— argues that the general theory of the
economy “has to be duplicated by analogy in a general theory
of every superstructural field— in this case, the political field
of the State.” The economist variant— what is generally called
technological determinism— conceptualizes the
superstructural instances “as mechanical reflections of the
economic base” (Poulantzas, 1980, 16). 17 (114)
o Just as there can be no general theory of the economy
(economic science) having a theoretical object that
remains unchanged through the various modes of
production, so can there be no general theory of the
state-political having a similar constant object. What is
perfectly legitimate, however, is a theory of the capitalist
state.
- Secondly, he retains the distinction between mode of
production as an abstract-formal object and concrete social
formations as articulations of several modes of production at a
 given historical moment. While Poulantzas (1978a, 145– 147)
never clarifies the epistemological status of an abstract-formal
object, he definitely rejects structuralist abstractionism (i.e.,
formalism), which seems to assign an objective (i.e., Platonist)
reality to these concepts, but he is also equally vehement in
rejecting Max Weber’s heuristic notion of an ideal-type.
Nevertheless, Poulantzas (1980, 25) clearly distinguishes
himself from Althusser, Balibar, and Therborn by insisting that
one cannot deduce the characteristics of a social formation
“as merely heaped up concretizations of abstractly reproduced
modes of production; nor, therefore, should a concrete State be
considered as a simple realization of the-State-of-the-
capitalist-mode-of-production.” (115)
- While the state’s social welfare responsibilities were being
curtailed as part of the transition to a new state form,
Poulantzas observed that its economic functions were
simultaneously increasing to such an extent that one could
now theoretically identify a specialized state economic
apparatus in addition to the repressive and ideological state
apparatuses (e.g., the strengthening of central banks, business
friendly tax reform, finance and trade ministries, state labor
exchanges, work - force retraining, economic development
agencies). While Poulantzas had already called attention to the
shortcomings of Althusser’s conception of the state, the
Althusserian view of autonomous instances and independently
functioning apparatuses was now completely incapable of
theorizing this restructuring of the state form. Thus,
Poulantzas (1980, 170) insisted that “unless we break with the
analogical image according to which the state apparatuses
are divided into watertight fields, we cannot grasp the
reorganisation, extension, and consolidation of the state
economic apparatus as the restructuring principle of state
space.” (117)

Globalisation and the return of the state

- Michel Aglietta identifies (1979), “the wage-relation” as the

cornerstone of the capitalist mode of production, since it is
the basis of exploitation and therefore capital accumulation. 6
Aglietta anticipated globalization as a territorial expansion of
the wage-relation, but in extending the territorial reach of the
 capitalist wage-relation, he observes that capitalist
enterprises come into conflict with the reciprocal obligations
of traditional societies. Thus, in substituting the capitalist
wage-relation for the relationships of traditional societies, the
introduction of capitalist social relations tears apart the social
ethos and other forms of social regulation that constitute the
older civil societies. The result is that new social norms must
be instituted by the state and this process requires the state
to intervene in civil society and to restructure it in ways that
are compatible with the emerging wage-relation. Following
Poulantzas, Aglietta (1979, 32) suggests that historical and
empirical investigations of this process would demonstrate
that “the state forms part of the very existence of the wage
relation.” 7 (123)
- Capitalist Regulation Michel Aglietta identifies (1979), “the
wage-relation” as the cornerstone of the capitalist mode of
production, since it is the basis of exploitation and therefore
capital accumulation. 6 Aglietta anticipated globalization as a
territorial expansion of the wage-relation, but in extending the
territorial reach of the capitalist wage-relation, he observes
that capitalist enterprises come into conflict with the
reciprocal obligations of traditional societies. Thus, in
substituting the capitalist wage-relation for the relationships
of traditional societies, the introduction of capitalist social
relations tears apart the social ethos and other forms of social
regulation that constitute the older civil societies. The result
is that new social norms must be instituted by the state and
this process requires the state to intervene in civil society and
to restructure it in ways that are compatible with the emerging
wage-relation. Following Poulantzas, Aglietta (1979, 32)
suggests that historical and empirical investigations of this
process would demonstrate that “ the state forms part of the
very existence of the wage relation .” 7 (124)
- In this formulation, the internationalization of the nationstate
entails an internal restructuring of the state apparatus and a
realignment of its attachments to various class forces, but its
policies continue to be generated by the systemic requirement
that it manage the contradiction between (now) global
accumulation and domestic legitimation (O’Connor 2002, xiii–
xviii). The function of the nation-state has not been diminished
 as a result of globalization, although the form of state
intervention in the economy and society has changed
considerably. As Leo Panitch (1994, 69) puts it: “The state now
takes the form of a mediator between the externally
established policy priorities and the internal social forces to
which it also still remains accountable.” (127)
- Many international trade agreements, including the WTO, go far
beyond the effort to merely liberalize trade between nations, or
construct an international division of labor, as previously
characterized the world capitalist system (Schirm, 2002,
Chaps. 3– 5; Cf. Wallerstein, 1980). These new treaties between
nation-states prohibit discrimination between national and
foreign owned corporations (so-called national treatment) and
even create new corporate property rights such as guarantees
of intellectual property rights, the repatriation of profits, and
extended patent protection, among others. In this respect, the
more recent trade agreements do not merely liberalize trade
between countries, but “function as an economic constitution,
setting the basic rules governing the private property rights
that all governments must respect and the types of economic
policies that all governments must eschew” (Robinson 1993,
2). These new private property 17 rights typically go well
beyond those previously established in most countries,
although they frequently mirror U.S. property and contract law
and, thus, effectively extend the U.S. Constitution’s 5th and
14th Amendment protections to virtu ally the entire globe
(Hartmann, 2011). (128)
- Jessop observes three major structural shifts in the state form
that are still ongoing in response to the continuing
development of a new regime of global accumulation. A first
response involves the internationalization of domestic policy
regimes that incorporate the personnel and interests of those
fractions of capital involved in global accumulation directly
into the national policy regime. The international context of
capital accumulation increasingly provides the basis of policy
formation, decision making, and state actions through its
incorporation into domestic policy-making processes and
political discourse. The internationalization of domestic policy
regimes certainly requires the incorporation of extraterritorial
or transnational agreements and processes into state policy
 making and action (e.g., IMF, WTO, NAFTA, EU), but “the key
players in policy regimes have also expanded to include
foreign agents and institutions as sources of policy ideas,
policy design, and implementation” (Jessop, 2002a, 208). (145)
o However, in many ways, the internationalization of policy
regimes may well intensify the central contradiction
between - - diction as “the displacement of crisis through
the reallocation the requirements of accumulation and
legitimation. Thus, Jes sop (2002a, 205) identifies a
second response to this contra of functions to different
levels of economic and political organization.” Jessop
refers to this process of political devel - opment as “a
general trend toward the denationalization of the state
206) argues that the national state apparatuses are
being hollowed out in a process where both old and new
state capacities are “being reorganized territorially and
functionally on sub-national, national, supranational, and
trans-local levels” ” (see also, Jessop, 2002b, Chaps. 5–
7). Jessop (2002a, (see also, Pierson, 1996, 204). This
process is most visible in the European Union, but it is
also occurring to a lesser degree in the NAFTA region
and in other formal intergovernmental blocs (Zurn, 2005).
(145)
- The expansion and deepening of the scope of governance
required to facilitate capital accumulation necessitates these
factors under the logic of capital” (i.e., as social capi a
structural denationalization of the state. Jessop (2002a, 206)
observes that this process has “major implications for the role
of local and regional governments and governance
mechanisms insofar as supply-side policies are supposedly
more effectively handled at these levels and through public-
private partnerships than at the national level through
traditional legislative, bureaucratic, and administrative
techniques.” However, - the rising significance of local and
regional forms of sub national governance cannot be confined
merely to traditional forms of “the local state” (Gottdeiner,
1987), precisely because economic regions, supply chains, and
industrial clusters have emerged as the new centers of global
competitiveness (Porter, 1990, Chap. 6– 7). These regional
clusters not only exceed the geographic reach of existing
 forms of the local state, but they are frequently international
regions defined by cross-border economic linkages (Perkmann
and Sum, 2002). (146)
- Claus Offe (1984, 249; 1996, 22– 27) describes the same
process as “a dissolution of the institutional separateness, or
relative autonomy of the state, the withering away of the
capitalist state as a coherent and strictly circumscribed
apparatus of power.” The process of destatization is one in
which “policy-making powers are ‘contracted out’ to consortia
of group representatives who engage in a semi-private type of
bargaining, the results of which are then ratified as state
policies or state planning.” A key feature of destatization in
Offe’s view is the parallel trend toward strengthening
intermediate organizations in national and international civil
societies that are legally “private,” but which are capturing
sovereign functions from the state or receiving them as
delegated powers of the state. (147)

The Return to State Theory

- It is no longer possible to pretend that the state is in retreat as

the global financial and economic crisis resulted in massive
state interventions and, once again, despite the myth of
neoliberalism, the state visibly reemerged as the main
structural and institutional mechanism for restabilizing and
reproducing the capitalist mode of production on a global
scale, and primarily through the actions of nations-states,
albeit led by and coordinated with the United States. Thus, as
Martijn Konings (2010, 174) observes, “the period since the
onset of the global financial crisis in 2007 has seen
unprecedented public interventions into economic life. As a
result, the role and presence of states has taken on a new
degree of visibility. . . . If the state’s presence and active role
were impossible to miss, so - was the fact that the benefits of
its interventions were distributed in a highly unequal manner.”
(159)

Jessop, B. 2008, State power, Polity Press, Cambridge.

Strategic Relational Approach

- This led to my account of accumulation strategies as means of

imposing a provisional, partial, and unstable 'substantive unity'
 on the various interconnected formal manifestations of the
capital relation and thereby securing the conditions for
relatively stable periods of economic growth. These ideas
originated in an analogy between Gramsci's analyses of lo
stato integrale (the integral state) and what I termed
Veconomia integrale (the integral economy). While Gramsci
defined 'the state in its inclusive sense' as 'political society +
civil society' and saw state power in Western societies, as
based on hegemony, armoured by coercion, my strategic-
relational account defined the 'economy in its inclusive sense'
as an accumulation regime + social mode of economic
regulation' and analysed capital accumulation as 'the self-
valorization of capital in and through regulation'. This analysis
was combined with interest in state projects and hegemonic
visions and an attempt to ensure the commensurability of all
three concepts within a strategic-relational approach (Jessop
1983) (24)
- In particular, it rejected attempts to develop a general theory
of the capitalist state (let alone of the state in general) and,
instead, offered four guidelines for analysing the state as a
concrete-complex object of inquiry: The guidelines comprise
the following: (1) the state is a set of institutions that cannot,
qua institutional ensemble, exercise power; (2) political forces
do not exist independently of the state: they are shaped in part
through its forms of representation, its internal structure, and
its forms of intervention; (3) state power is a complex social
relation that reflects the changing balance of social forces in a
determinate conjuncture; and (4) state power is capitalist to
the extent that it creates, maintains, or restores the conditions
required for capital accumulation in a given situation and it is
non-capitalist to the extent that these conditions are not
realized (1982: 221). Some fundamental substantive concepts
for analysing the states institutional architecture, its social
bases, state projects, and the organization of hegemony were
then elaborated on the basis of these guidelines. (28)
- This analysis was based on a 'relational" approach that
focuses on 'the relations among relations", that is, 'an analysis
of the relations among different relations comprising the
social formation" (1982: 252). This approach had some
fundamental implications, which I then presented, for the
 analysis of structure and conjuncture, structural constraints
and con- junctural opportunities, the complex, overdetermined
nature of power relations, the vital role of specific
mechanisms and discourses of attribution in identifying the
agents responsible for the production of specific effects within
a particular conjuncture, the significance of specific
capacities and modes of calculation in framing individual and
collective identities, the relational and relative nature of
interests, and the dialectical relation between subjective and
objective interests (1982: 252-8). (29)
- These guidelines proved controversial in some quarters
because they rejected the view that there is a fundamental
ontological distinction between state power and class power. I
was careful to note that the 'third guideline implies a firm
rejection of all attempts to distinguish between "state power"
and "class power" (whether as descriptive concepts or
principles of explanation) insofar as they establish this
distinction by constituting the state itself as a power subject
and/or deny the continuing class struggle within the state as
well as beyond it" (1982:224-5). This guideline was based on
the sound strategic-relational arguments that (a) the state is
neither a unified subject nor a neutral instrument but an
asymmetrical institutional terrain on which various political
forces (including state managers) contest control over the
state apparatus and its distinctive capacities; and (b) class
power depends less on the class background of those
nominally in charge of the state or their subjective class
identities and projects than on the differential class relevance
of the effects of the exercise of state capacities. in a complex
and changing conjuncture. This does not reduce state power to
class power. Nor does it exclude the influence of the core
executive, the military, parliamentary deputies, or other
political categories in all their complexity in the exercise of
state power or the determination of its effects. Nor again does
it exclude that the state's role as a system of political class
domination could sometimes be secondary to its role as a
system of official domination over 'popular-democratic forces'
or, indeed, secondary to its institutional mediation of the
relative dominance of another principle of societalization
(such as theocracy, 'racial' apartheid, or genocide). But such
 issues can only be adequately explored by refusing a radical
distinction between state power and class power. (31)
- Poulantzas has an implicit account of the state as a social
relation. The same argument runs through Marx and Engels's
reflections on the state and can be paraphrased to read that
state power is a social relation between political forces
mediated through the instrumentality of juridico-political
institutions, state capacities, and political organizations (Marx
1843, 1850,1852, 1871a; and chapter 3). Poulantzas expressed
this intuition in his thesis that state power is an institutionally
mediated condensation of the balance of forces in political
class struggle (chapter 6). Because Marx and Engels did not
present this account in a systematic movement* from
abstract-simple to concrete-complex arguments, however, it
was easy for subsequent Marxist state theorizing to read their
work on the state in highly selective and often simplistic ways.
(56)
- Two issues are at stake here. First, given that the state power
is a form- determined condensation of forces in struggle, the
significance of particular strategies pursued by particular
agents varies with the nature of the state. Different types of
state and political regime selectively reward different types of
actors and strategies. Second, given again that state power is
a form-determined condensation of forces in struggle, the
state apparatus and its capacity to act depend heavily on the
capacities and aims of forces represented within the state,
struggling to transform it (or prevent its transformation), and
operating at a distance from it. Social forces are not mere
Tràger (bearers) of pre-constituted class identities and
interests but active agents, refle cting on their identities and
interests in specific conjunct tures, with all that this implies
for changing horizons of action. Th|fi different types of state
and political regime will be more or less vulnerab^ to different
types of strategy pursued by different blocs or alliances and
this vulnerability will change with the overall balance of forces
in a complex war of manoeuvre and tactics. (133)
- For both spatial and temporal organization, Poulantzas
stresses that the state always modifies the supposedly
natural' pre-given elements of nationhood. Thus it always
integrates elements such as economic unity, territory,
 language, tradition, and so forth, into the basic spatio-temporal
matrix of capitalism. Indeed Poulantzas is careful to contrast
the spatial and temporal organization of capitalist societies
with those in ancient and feudal systems and to trace its
implications for the divisions between nations, between
civilized peoples and barbarians, and between believers and
infidels, respectively. In this respect he emphasizes that the
modern nation is always a product of state intervention and
should not be considered as pre-political or primordial (1978b:
94, 96-103, 108-10, 113). (136)
- Poulantzas also stresses that conceptions of time, space, and
nationhood are overdetermined by class struggle. There are
bourgeois and proletarian variants of the capitalist spatio-
temporal matrix and also contrasting class versions of the
nation. The modern nation is not the creation of the
bourgeoisie alone but actually reflects a relationship of forces
between the 'modern' social classes. It is still pre-eminently
marked, however, by the development of the bourgeoisie.
Indeed, even when capitalism is undergoing
transnationalization, bourgeois reproduction is still focused on
the nation-state. Thus the modern nation, the national state,
and the bourgeoisie are intimately connected and all are
constituted on the same terrain of capitalist relations.
Poulantzas concludes that 'the modern nation is written into
the state, and it is this national state which organizes the
bourgeoisie as the dominant class' (1978b: 117). (136)

Poulantzas, N 1978, Political Power and Social Classes, Verso,

London.

Poulantzas, N 2000, State, Power, Socialism, Verso, London.

‘The capitalistic state must try to fulfil two basic and often
contradictory functions – accumulation and legitimisation. This
means that the state must try to maintain or create the conditions
in which profitable capital accumulation is possible. However, the
state must also try to maintain or create the conditions for social
harmony’ ─ James O’Connor, The Fiscal Crisis of the State.

Evaluate O’Connor’s proposition regarding the dynamics of the

capitalist state

To uphold the system of capitalism two functions must successfully

play out; accumulation and legitimisation. To understand how this
system functions as a whole it is necessary to understand both
what these words mean in the context of economics and how they
realistically play out in society. We must also break the systems
internal workings down even further, looking at why the state
functions in the way that it does, and who maintains the mechanical
workings of the state, both economically and socially. As this essay
expands to answer these questions, it is important to keep in mind
that under capitalism, accumulation and legitimisation are
intrinsically linked, both to each other, to the state and ultimately, to
the overarching economic system of capitalism.

Capital accumulation is the basic economic principle of capitalism.

The theory is that a monetary investment in producing goods or
services will result in a profit for the person who has invested
(Marx, 1867). In its most common form it can be seen when
someone who owns the means of producing goods (the mechanics
of production) employ workers who are paid at a set wage for using
their labour power to produce goods. The profits which come from
selling the finished product go back to the person who owns the
means of production and thus they ‘accumulate capital’ from the
surplus profit (Marx, 1867). In basic classical economic theory this
accumulated capital should go back into the system to invest again
in systems of production to produce more goods, employ more
workers, and accumulate more capital, and thus the system will
repeat itself. The reality of this system is not as simple. Classical
economic is based on the theory that self-interest is an
undisputable fact of life, and that the capitalist system of production
is the best way to harness this self-interest. "It is not from the
benevolence (kindness) of the butcher, the brewer, or the baker that
we expect our dinner, but from their regard to their own interest."
(Smith, 1776). However this system does not work as smoothly as
Smith once theorised. Under modern day capitalism the capital
produced through this system is not fully redistributed through the
reinvestment in more production and markets, but is accumulated
by the rich in what is called the ‘crisis of accumulation’.

The crisis of accumulation is a market phenomenon in which a

market can collapse due to overinvestment. Marx explains that
overaccumulation and reinvestment can causes problems when a
market can no longer produce an adequate profit to the capitalist
who have invested, due to inadequate demand for a service or
product. When markets becomes flooded with capital in this way, a
devaluation of capital and labour occurs. “ Capital accumulation is
essence of capitalist system. Making profit maximum is the
system’s main goal and when the capital accumulation stops, this
situation causes crisis’s.” (Genc, 2011) This type of crisis can
materially result in a loss of jobs resulting in mass unemployment,
and the crisis which come hand in hand with this. We can see
historically this has happened in the past, with devastating effects,
such as The Great Depression of the 1930’ and 40’s (Genc, 2011).
When the flaws of capitalism, and more specifically capital
accumulation, can be seen in this way by the citizens of a state it
becomes harder to legitimize the system as a whole.

The mechanics of the state which uphold capitalism must be

‘legitimized’, or seem logical and necessary for society to continue
to work harmoniously. Legitimisation is a more complicated function
to define than accumulation, as it has many aspects which
interrelate and depend on each other. Put simply, it is the basic
upholding of living conditions and moral of workers to continue the
system of capitalism through a worker/boss power dynamic.
Capitalism must be legitimized in order to counteract any
disillusionment and stop any chance of revolt against the
government and ruling class. Under capitalism while “capital
accumulation is possible (it must also) try to maintain or create the
conditions for social harmony. A capitalist state that openly uses its
coercive forces help one class accumulate capital at the expenses
of other classes loses its legitimacy and hence undermines its basis
of support.” (O’Connor, 1973). As O Connor explains; legitimization is
necessary to uphold the system of capitalism.

The state provides the circumstances under which capital

accumulation is possible through the upholding of the system of
efficient market system. This includes processes and laws which
allow businesses the freedom to choose how much to pay
employees for their labour, how many employers to hire, and how
much to sell their products and services for (Harman, 1979). This
economic concept of the free market is essential to the key
workings of capitalism. The freedom given to those who own the
means of production is beneficial in their ability to accumulate
capital (Marx, 1867). However, this same system can cause
disillusionment and unrest in those who are worse off, and have to
sell their labour power for what is usually a much lower profit than
those who employ them. This is exactly why the state must also
uphold the system of capitalism through laws and processes which
legitimize the system and keep the citizens of a state happy with
their situation.

Neoliberalism is a system which allows for extreme capital

accumulation under a free market, however it’s interaction with
society is one which is often hard to legitimize. The modern
capitalist system of neoliberalism is a system built on the theory
that individual self-interest and motivation will spur the market
toward equilibrium without the intervention of the state. What this
theory fails to address however is the role that workers play in the
upholding of the capitalist state. Without a majority proletariat class
who act as workers under capitalism, the system of capital
accumulation would be unable to function. It is therefore an obvious
observation to make that this large group of people have basic
needs which need to be met in order for them to remain productive,
namely; health, education, food and shelter. However due to the
nature of the capitalist system, in most cases it is essential to work
for a wage in order to provide the basic needs for survival, leaving
workers tapped in the capitalist system which is controlled by those
who own the means of production. As David Harvey argues, “The
rich command the space in which the poor are trapped in” (Harvey,
2009). The organisation and provision of these services are left in
the hands of the state, as a self-interested market built on capital
accumulation does not interact well with systems such as health
care. We can thus see that the theoretical separation of the state
and economic system which underpins neoliberalist theory is in fact
a paradox. It can be argued that if the control of a society was left
entirely to neoliberal economics, the system would not be able to
function, let alone be legitimized to a society.

O’Connor stresses that social harmony must be achieved in order to

legitimize an economic system which allows capital accumulation.
However, what do we mean by social harmony? Do we mean a
society that is truly happy and without fault? Or do we actually
mean a society which is able to function at a basic level to uphold
the system of capitalism and capital accumulation for those who
control the means of production? Through standards of living
throughout the world, as well as the continually widening gap
between the rich and poor it can be seen that under the economic
system of capitalism, it is the latter (Harman, 1979). In theory to
uphold a basic standard of living the state should provide basic
medical services, education, access to housing and essential
services such as water and electricity. However under neoliberalism
we can see even these basic services are being privatised and often
are only accessible for those who are better off than most. This is
because, under the neoliberal paradigm the market “does not
distinguish between ordinary consumer goods and public goods
such as health care” (Horton, 2007). While in some countries there
are systems in place where services such as education and medical
treatment are available at a limited cost, these services also exist
in teared system, with the best quality only available to those who
can afford it. The growing inaccessibility of vital resources for the
majority of the population does not bode well for the legitimization
of capital accumulation.

Basic Marxist theory explains that capital accumulation leads to

inequality through an increasingly widening economic gap between
the bourgeoisie class and the proletariat. Capitalism allows for
unbridled accumulation of wealth which flows into the pockets of a
small minority. These people, who by nature and according to the
workings of classical economic theory, are self-interested, and rely
on extreme exploitation of the working class to continue to
accumulate capital. “Capitalism rests, as Marx tells us, upon the
perpetual search for surplus value (profit).” (Harvey, 2012) The
exploitation of labour power and resources to accumulate capital for
the sake of accumulating capital is a system which is
unsustainable. We exist in a world where the main natural resources
which are exploited through the capitalist market are non-renewable
e.g. coal and precious minerals. This has caused extreme
environmental degradation and increased the speed of climate
change (Newell, 2013). While it can be seen that it is the bourgeoisie
class who are responsible for the workings of the markets which
have caused this, they will not be the people who are affected first.
The global south is already experiencing the effects of global
capitalists impact on the environment, and will continue to at an
increasing rate (Roberts & Parks, 2014). Through the exploitative
nature of capital accumulation the world is starting to see
devastating effects on the environment. This is becoming harder
and harder to legitimize, and thus we can see how capitalism can
not continue in its path of unbridled capital accumulation forever.

Capitalism is an unsustainable economic system that will not be

able to be legitimized forever. A system built on the concept of
unbridled capital accumulation is not compatible with a world which
is made up of non-renewable resources. Capital accumulation will
continue to flow to the rich, and as explained earlier, will not be
redistributed for the benefit of all of society. As this becomes clear
to society the ability for social harmony is decreased. We can see
throughout history that when a state can no longer keep it’s citizens
content with the standard of living they have in comparison with the
extreme rich, there is mass unrest. Ultimately O’Connor statement
is correct, a state that can no longer care for its citizens is a state
that can no longer legitimize capital accumulations existence.

References
Genc, S. Y., 2011. The Historical Evolution of the Capital
Accumulation in the Capitalist System. International Journal of
Business and Social Science, 2(9), p. 268.

Harvey, D., 2009. Social Justice and The City.. Athens: University of
Georgia Press.

Harvey, D., 2012. Rebel Cities. London: Verso Books.

Horton, E. S., 2007. Neoliberalism and the Australian Healthcare

System (Factory).. Wellington, New Zealand.: Conference of the
Philosophy of Education Society of Australasia,.

Marx, K., 1867. Capital: Critique of Political Economy. s.l.:s.n.

Newell, P., 2013. Globalization and the Environment- Capitalism,

Ecology and Power. s.l.:Polity Press.

O’Connor, J., 1973. The Fiscal Crisis of the State. s.l.:s.n.

Roberts, J. T. & Parks, B. C., 2014. A Climate of Injustice- Global

Inequality, North-South Politics, and Climate Policy. s.l.:MIT Press.

Smith, A., 1776. The wealth of nations. Scotland: William Strahan,

Thoas Cedell.

‘The   capitalistic   state   must   try   to   fulfil   two   basic   and   often   contradictory   functions   –
accumulation and legitimisation. This means that the state must try to maintain or create the
conditions in which profitable capital accumulation is possible. However, the state must also
try to maintain or create the conditions for social harmony’

Evaluate O’Connor’s proposition regarding the dynamics of the capitalist state. 

That the state is a key institution in society is not a contentious claim. Indeed, across various
disciplines,   the   state   is   often   the   focus   of   study   due   to   the   significant   role   it   plays   in
international political economy. As such, there has been developed various theories as to the
nature and function of the state. This essay will argue from a Marxian perspective to affirm
O’Connor’s   proposition   that   effectively,   the   state   plays   a   twofold   role   in   society   under
capitalism; to create conditions allowing for greater capital accumulation and to legitimate
such   behaviour.   Furthermore,   it   will   more   importantly   make   the   argument   that   the   state
behaves in such manner because of its socially embedded nature and the social relations from
which state­power results. In highlighting this, the essay will first deal with the reification of
the state as its own separate entity following key political economy theories. Secondly, it will
refute   such   claims   and   affirm   O’Connor’s   theory   through   analysis   of   state   action   and
intervention in real lived experiences. Finally, it will explore how it is the internal relations of
forces in society under capitalism that results in the state acting in this way. 

It is first necessary to consider the various differing conceptions of the state held in political
economy. Moreover, a prevailing thought in mainstream political economy is the view of the
state as its own, distinct institution holding power over the sphere of politics as separate from
the economy or the market. As such, most schools in political economy have developed
theories of the state following this false demarcation. This is evident through the Neoclassical
school’s   support   of   Say’s   Law,   the   claim   that   aggregate   supply   creates   equal   aggregate
demand   (Marshall   1920,   pp.   198­204;   Friedman   &   Friedman   1980,   pp.   14­15).   As   per
Friedman   (1962,   pp.   27­38),   with   markets   viewed   to   naturally   reach   equilibrium,   state
intervention   is   seen   as   unnecessary   or   even   detrimental   to   this   realisation.   This   theory
highlights the separation of the state from the market as distinct entities and institutions. The
distinction is also evident in Keynesian economics. Whilst Keynesianism certainly criticises
the Neoclassical school and opposed Say’s Law, the reification of the state as opposed to the
market is still present. Converse to the Neoclassical theory however, the state is regarded to
be a progressive actor in capitalism to ensure the success and efficiency of the market and
therefore, wider society (Salais 2015). Again, whilst holding a different conception of the
state and its nature, the Keynesian school artificially distinguishes the state and market as
entities divorced from each other and the wider society. Under both theories, the state is
viewed as an unbiased entity. 

However, the reality of state actions in society and the market highlight the falsity of the
demarcation of the state. Neoliberalism, in theory, stresses the superiority of markets over the
state. Indeed Hayek (1972, pp. 36­71), a vehement defender of neoliberalism argued that as
markets are more efficient for the functioning of the economy, this would in turn also result
in greater political efficiency. Parker (2013, pp. 18­19) notes that as such, neoliberalism has
commonly been considered to be an economic system with minimal government intervention
and a free market economy. In practice, however, it is evident that this is not the case. Cahill
(2010, p. 301) notes that under former Australian Prime Minister John Howard – as per
Maddison and Martin (2010, p. 101), an advocate of neoliberalism – government spending
amounted to 24.4 per cent of Australia’s GDP from 2007­2008. This is in comparison to the
period under former Prime Minister Gough Whitlam, where government spending reached
only 18.3 percent between 1973­1974, heralded as the great Keynesian era (Cahill 2010, p.
301). Even Berg (2008), a prescriber of neoliberalism recognises that State intervention has
grown in states that supposedly support laissez­faire economics. As such, Cahill (2009, pp.
12­14) argues  that neoliberalism in its  real and existing form need not be tantamount to
‘small government’ but rather, it is the implementation and practice of policies and actions
that result in greater economic freedom, expand the sphere of commodification and reduce
organised labour power. Thus it is clear that the state actively intervenes in the economy,
even in periods of neoliberalism. 
Furthermore, contrary to Keynesian views of the state as a progressive actor for the wider
public, the real­lived experiences of the state highlight the State acting in the interest of
capital accumulation. Following the Global Financial Crisis of 2007­2008, former Australian
Prime   Minister   Kevin   Rudd   injected   large   stimulus   packages,   publicly   ‘opposing’
neoliberalism (Parker 2013, p. 129). As noted by many academics such as Parker (2013, p.
16) and Stiglitz (2008), such actions were not distinct to Australia but seen across many
OECD state, leading many to consider the period to be the end of neoliberalism. However,
Parker (2013) argues that such policies were actually neoliberal in the nature, delivery and
impact on the economy. Analysis of the fiscal intervention during this period by Parker and
Cahill (2017) reveals that the ‘Building the Education Revolution’ program heavily relied on
neoliberal practices of outsourcing and privatisation to carry out the program. Furthermore,
Parker (2013, pp. 145­165) notes that the government’s First Home Owner’s Boost failed to
assist the wider public such as the unemployed, homeless or pensioners where rather than
investing directly into public housing programs, the cash payments funded higher income
households. Similar to the neoliberal model, the Keynesian model of the state is not realised
in practice. 

This disconnect between the theories and reality could be taken to mistakenly identify the
nature  of the  state.  Marx’s   (2010) comments   that  “The  executive  of the  modern  state  is
nothing but a committee for managing the common affairs of the whole bourgeoisie” (Marx
2010, p. 221), misguidedly analysed, could be taken to be interpreted that the state as an
institution is simply a tool of the ruling capitalist class. Indeed, as recognised by Hay (1999,
pp. 153­154), an instrumentalist Marxian understanding of the state is exactly the viewing of
the state as an instrument of the ruling class to maintain and guarantee the capitalist system.
Such   a   conclusion   may   seem   plausible   particularly   due   to   the   actions   of   the   state   as
mentioned above, continuously acting in the interests of capital accumulation, regardless of
which economics theory is followed. However, this too would be an oversimplification and
misanalysis of the dynamics of the state. 

According to O’Connor (1973, p. 6), the state under capitalism has two functions, capital
accumulation   and   legitimisation.   The   first   part   of   this   twofold   function,   maintaining   or
creating the conditions for profitable capital accumulation has been clearly exemplified by
the examples above. Indeed, though these are only concerned with Australia in periods of free
trade,   the   experience   is   further   widespread   and   applicable   in   different   economic   and
geographical contexts. During South Korea’s development period between 1960­80’s, the
state   implemented   protectionist   policies   and   intervened   heavily   through   subsidies   and
investments.   However,   as   noted   by   Amsden   (1990,   pp.   13­18),   the   fast   economic
development and high profits in Korea was also the result of greater surplus­value extraction
with longer working hours and the greater repression of the working class. Such widespread
experiences of the state bears truth to the O’Connor’s claim that a primary function of the
state is capital accumulation. 
In following, the second role of the state to legitimate such motives and actions is also clear.
As per O’Connor (1973, p. 6), the state cannot openly use its coercive forces in the interest of
capital accumulation that will undermine another class and so it is imperative the state also
creates conditions of social harmony. Gramsci (1999, pp. 497, 532) similarly claims that the
integral meaning of the state is dictatorship and hegemony. Where the state uses dictatorial
coercive forces in the interest of capital accumulation, it is equally significant for the state to
achieve   a   hegemony   and   widespread   support   for   their   actions   so   as   not   to   risk   losing
legitimacy and thus power. Gramsci (1999, pp. 450­451) notes that a general crisis of the
state occurs when there has been a failure to achieve legitimacy or where legitimacy has been
lost. Indeed, the significance of this can be seen through the Tunisian Revolution in 2011.
Redissi (2014, pp. 382­387) accounts of the Tunisian Revolution, noting that the revolution
was   the   result   of   the   failure   of   the   Islamist   party,   En­Nahada,   to   achieve   legitimacy   in
government from the Tunisian society when they failed to provide a constitution despite the
request of Tunisians and used coercive measures, infringing on freedoms and liberties of
press   and   information.   The   Tunisian   Revolution   was   a   spark   for   the   region­wide   Arab
Springs, highlighting the great implications of failing to establish hegemony, not only on a
national scale but also regional or globally. Thus the imperative of the second function of the
state is clear. 

Whilst then the functions of the state is accounted for, still the reasons as to why the state acts
in such a manner, in the interest of capital accumulation when it is not actually or necessarily
a part of or tied to the capitalist class is needed. Critical to an understanding of this dynamic
of the capitalist state is first dismantling the notion of the state as a fixed entity. Indeed, the
abovementioned failure of Neoclassical and Keynesian theorisation of the state is in actual,
illustrative of the internal relations approach. Converse to mainstream political economics,
Wood (1981, pp. 66­95) argues against the dichotomisation of the state and market through
the social property relations approach. The state is not considered its own separate entity but
rather socially embedded in society, along with the market (Wood 1981, pp. 66­68). 

In that sense, the state is constantly influenced by factors and forces in society. Converse to
the instrumental Marxist view of the state, Poulantzas (2000) argues that the state is actually
relatively autonomous from the ruling class. This is further theorised by Jessop (2016, pp. 53­
90) and his Strategic Relational Approach. As posited by Jessop, the state or state power is
the result of the interaction of various dimensions. Similarly, Poulantzas (1978, pp. 128­129)
notes that like capital, the state is a relationship of forces and the relationship of classes, as
well as class fractions. From this, the driving force behind the dynamics of the capitalist state
to accumulate further capital as well as to legitimise this becomes clear. It is necessary for the
state   to  accumulate   capital   so   as   not   to   lose  the   source   of   revenue   and   thus   power,   but
concurrently, it cannot be seen to do so at the expense of other classes or class fractions or it
would risk social upheaval. Thus state power is reflective of the inherent class conflict that
exists   under   capitalism.   As   the   ruling   class   holds   power   over   and   owns   the   means   of
production and capital, thus these parties hold greater power than those groups originating
from the working class. As Gramsci (1999) notes, “Classes produce parties, and parties form
the personnel of State and government, the leaders of civil and political society” (Gramsci
1999, p. 477). 

In conclusion then, the real­life actions of the state bears truth to O’Connor’s argument. State
interventions in political economy can be seen to serve the goal of capital accumulation and
then   the   legitimisation   of   its   actions.   Thus   the   views   of   the   state   as   held   in   orthodox
economics as an unbiased actor or even a protector is challenged by the actual behaviour of
the state itself. However, what is even more crucial to an understanding of the state is the
analysis of the underlying relations that results in the state acting the way it does. For this, the
internal relations approach, and an understanding of the socially embedded nature of the state
is   critical.   The   state   does   not   strive   for   capital   accumulation   because   it   is   inherently
‘capitalist’ but rather, as the state is socially embedded in society and thus born from the
internal relations of various forces. Further, it is the class conflict inherent in class society
under capitalism that determines that the state acts in the interest of capital as the ruling class
holds power in society. Perhaps then, this is to signify to win over the state, the class struggle
must be won.  

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The Strengths and Limitations of James O’Connor’s State Theory

Does O’Connor successfully characterise the capitalist state and its tendency to fiscal crisis?

This essay will begin by outlining his approach and raising a minor critique of its somewhat

confusing categories of state expenditures. It will then outline the fundamental strength of

O’Connor’s focus on the social foundations of the state and its constant struggle to meet the

conflictual   demands   of  accumulation  and  legitimisation.   From   this   focus,   the   framework

produces   prescient   insights   on   the   state’s   inherent   tendencies   to   fiscal   crisis.   However,

hindsight finds that the work relies heavily on assumptions about the economy based on the

post­war context in which it was written, especially due to the limitations of its functionalist

mode of analysis. This essay will then turn to Bob Jessop’s  Strategic Relational Approach,

which   demonstrates   how   O’Connor’s   framework   can   be   improved   upon   by   eschewing

functionalism and avoiding the reification of the state at the level of the mode of analysis. 

O’Connor argues that ‘accumulation’ and ‘legitimisation’ are the existential imperatives that

define   the   functions   of   the   capitalist   state   and   ultimately   ensure   a   tendency   to   social,

economic and political crises due to their contradictory needs. The state is concerned with

accumulation as the source of its own power, since its fiscal survival hinges on its continued

ability to draw tax revenues from the economic surplus (O’Connor 1973: 6). However, a state

that transparently exercises its force to allow one class to accumulate capital at the expense of

other classes quickly undermines its own legitimacy. For this reason, every programme of

state expenditure has a dual character explained by O’Connor using the terms social capital

and  social   expenses  (1973:   6).   He   defines  social   capital  as   ‘expenditures   required   for
profitable private accumulation’; these indirectly productive expenditures serve to increase

the rate of profit, either by increasing the unit productivity of labour – for instance, through

state­developed infrastructure facilities – or by reducing the reproduction costs of labour, as

in the case of social insurance (O’Connor 1973: 7). On the other hand, social expenses  are

economically unproductive but critical to maintaining social harmony and state legitimacy.

Importantly, it is argued that the ‘dual and contradictory nature of the capitalist state’ means

that   every   operation   of   the   state   must   serve  both  the   accumulation   and   legitimisation

functions.   Thus,   transfer   payments   include   both   social   insurance   that   indirectly   supports

accumulation,   and   also   welfare   payments   paid   to   the   unemployed,   which   O’Connor

characterises as ‘not even indirectly productive’ (O’Connor 1973: 7). Certainly, by ensuring

that the unemployed feel looked after by the officials that purport to represent them, such

payments clearly serve the legitimisation function of the state. 

Yet in another way, it can be argued that such payments play a key role in facilitating and

naturalising   the   existence   of   a   reserve   army   of   labour,   which   is   central   to   maintaining

capital’s   power   to   extract   surplus   from   wage­labour   at   a   rate   consistent   with   profitable

accumulation. Especially because he stresses the dual functions simultaneously performed by

every state activity, it is unclear whether O’Connor’s categories of social capital and social

expenses are entirely productive to his argument, or whether it is even possible to separate

out these two classifications in any meaningful way. Indeed, referring to the social expenses

of  environmental  degradation,  O’Connor recognises  that  owing  to  the  increasingly  social
character of modern production, these costs are a threat not only to the ecological structure,

but also to profitable accumulation itself (O’Connor 1973: 195­196). Because of this problem

of circularity, we may find more use in concepts such as Castells’  collective consumption,

which   does   not   divide   state   expenditures   serving   accumulation   into   ex­ante   and   ex­post

categories (Castells 1978: 168).  

O’Connor’s work finds strength in centring itself on the social foundations of the state. He

diverges from orthodox, depoliticised conceptions of the state by taking the social functions

of accumulation and legitimisation as the starting point of analysis, conceiving of the state as

a process in a constant struggle to perpetuate itself. This analysis draws heavily from the

seminal writings of Gramsci and his emphasis that ‘the state is not to be found only where it

appears to be “institutionalised”’ (Gramsci 1972: 262). Of critical importance for Gramsci is

the mutually constitutive relation of civil society to the operation of the state; for him, one

cannot separate the political from the social or economic. This Marxist approach stands in

contrast to orthodox theories of the state that treat it as a political entity distinct from the

economic sphere; at most, the state in this approach is externally related to the economy

through   ‘interventions’   in   otherwise   depoliticised   markets   (Wood   1981:   92).   Indeed,   for

O’Connor,   state   sector   expansion   is   fundamental   to   the   growth   of   private   industry   and

especially monopoly capital (O’Connor 1973: 7). The associated ‘crowding in’ of investment

as   a   result   of   public   expenditure   is   a   direct   refutation   of   the   contemporary   conservative

conception of the state and the private sector as mutually exclusive. This apparent separation
of the ‘political’ from the ‘economic’ sphere in capitalism obscures the exploitive nature of

production, representing as universal relations of production which are in fact completely

socio­politically contingent (Wood 1981: 69). The misconstruction of the state as an entity

primarily   separate   from   the   economy   is   not   only   made   in   Orthodox   economics.   Wood

critiques the common misinterpretation of the Marxist ‘base­superstructure’ model that sees

the role of ‘superstructural institutions’ in maintaining the economic ‘base’, but ignores that

‘that the productive base itself  exists in the shape of  social, juridical, and political forms’

(Wood   1981:   69­70,   emphasis   added).   O’Connor’s   state   theory   respects   this   more

compelling, mutually constitutive version of the ‘base­superstructure’ model. His approach

should be credited for highlighting the social foundations of the state and its integral role in

securing profitable accumulation.

The other main thrust of O’Connor’s argument concerns the crisis tendencies of the state

resulting from its dual and contradictory functions. He argues that social capital expenditure

increases over time as the socialisation of capital costs becomes increasingly necessary for

profitable accumulation by monopoly capital (O’Connor 1973: 8). This is because private

accumulation of constant and variable capital is inhibited by the increasingly social nature of

production   –   characterised   by   a   pronounced   division   of   labour,   specialisation,   and

interdependency – and the growing role of types of social capital such as education in the

production process. However, the growth of the monopoly sector is also accompanied by

‘market failures’ such as unemployment, mass poverty, and economic stagnation that must be
treated by state expenditure to fulfil the legitimisation function. Thus ‘the supply of social

capital creates the demand for social expenses’ (O’Connor 1973: 8). Whilst the increase in

social   capital   indirectly   expands   total   production   and   social   surplus,   thus  appearing  to

underwrite greater social expenses, ‘large monopoly­sector corporations and unions strongly

resist   the   appropriation   of   this   surplus   for   new   social   capital   or   social   expense   outlays’

(O’Connor 1973: 8). This divergence of expenditures and revenues is the key factor in the

tendency of the capitalist state to fiscal crisis. 

O’Connor’s analysis is firmly rooted in the post­war context, and it is arguable that many of

his basic assumptions do not stand the test of time and changing economic dynamics in many

developed economies. At the time of writing, rapid capital accumulation in the United States

necessitated consistent increases in skilled employees. In this context, collective consumption

expenditure   was   crucial   to   the   expansion   of   capital;   it   made   adequately­skilled   labour

available to capital without the burden of training and education, and restrained its price by

increasing the supply on the labour market (Schwartz 1983: 45). However, such expenditure

also   creates   path­forming   government   expenditure   categories   which   are   inflexible   to   the

evolving   needs   of   capitalist   interests.   According   to   Preteceille   (1981:   11),   following   the

1973­75 recession, and the updated strategies of capital that responded to it, ‘employment

and investment trends have changed, and the major public expenditures which contribute to

the   reproduction  of  skilled   labour   no  longer  match  capitalist  interests  in   the  same   way’.

Indeed, O’Connor’s work was based upon a vision of continued global hegemony for US
capital,   failing   to   anticipate   the   decline   in   basic   (i.e.   monopoly)   industry   domestically

(Schwartz   1983:   46).   With   the   increasing   mobility   of   capital   comes   the   rise   of   the

‘entrepreneurial’   regional   government,   which   vies   to   attract   business   ventures   with   site

preparations, tax concessions, and guarantees of a favourable ‘business climate’ (Preteceille

1981: 12). The position of fiscal austerity that results causes states to re­align expenditure

priorities, often sacrificing what O’Connor describes as  social expense  in order to increase

social  capital, and  social investment  more specifically (Schwartz 1983: 46). Such priorities

may favour the construction of industrial parks and shopping precincts at the expense of

welfare or public transportation, for instance.

Another drawback to O’Connor’s approach is the mode of its argument. O’Connor writes

much about ‘intent and effect’ to explain how the structure of capital accumulation brings

about fiscal crisis, recalling a teleological and functionalist approach. Schwartz argues that in

taking   this   tack,   he   ‘fails…   to   draw   out   the   varied   ways   in   which   corporations,   unions,

government   bureaucrats   and   agencies   and   other   relevant   actors   create   (and   recreate)   a

situation conducive to fiscal crisis’ (Schwartz 1983: 47). Granted, O’Connor does reference

the   importance   of   political   struggle   in   mediating   the   myriad   claims   on   state   budgets   by

special   interests.   He   notes   that   ‘few   if   any   claims   are   coordinated   by   the   market’,   and

additionally that ‘most are processed by the political system and are won or lost as a result of

political struggle’ (O’Connor 1973: 73). However, he does not go far enough to explicitly

show how the actions of relevant institutions and actors influence the dynamics of fiscal
crisis,   and   due   to  this,  his   portrait   of   the   relations   between   labour,   capital   and   the   state

remains schematic and functionalist, to its disservice. 

Incorporating   O’Connor’s   insights   into   an   institutional   approach,   Bob   Jessop’s  Strategic

Relational Approach (SRA) provides a framework for state analysis that avoids reifying the

state with an overly schematic or functionalist approach. Instead of studying the state as a

substantial, unified subject, the SRA looks at it as a changing balance of forces seeking to

advance   their   respective   interests.   Jessop   extrapolates   the   dual   accumulation   and

legitimisation roles of the state into ‘economic projects’ and ‘hegemonic visions’, which act

as more nuanced analytical tools, acknowledging that these are contested, dynamic activities

and   not   the   static,   functionalist   categories   found   in   O’Connor.   Jessop   begins   by

acknowledging that the general interest of capital consists of a shifting nexus of value and

non­value­forms that can take various configurations. Various capitals compete in order to

establish a mode of accumulation that serves their particular interests, requiring always the

support of state ‘economic projects’ (Jessop 1990: 202­203). Note that such strategies must

be articulated with the interests of capital in general to be viable, and that a plurality of

competing accumulation strategies will exist at any one time (Jessop 1990: 205). The state’s

support   of   one   accumulation   strategy   will   necessarily   marginalise   the   interests   of   some

particular capitals;  this  is  mediated  through the  creation of a ‘general  economic  interest’

(Jessop 2002: 30). This is the reason for the importance of ‘hegemonic visions’, which justify

state economic projects by tying them to some idealistic narrative about the role and purpose
 of the state and the values it should uphold. One may note the current push in support of the

Australian coal industry by the Monash Forum, which is building a hegemonic vision based

around a purported contest between environmentalism and economic development in order to

secure government financial support for new fossil­fuel mining and power plant operations.

This effectively supports an accumulation strategy that would marginalise the interests of

renewable energy and tourism capitals, which would lose out from the allocation of fiscal

support   to   environmentally­degrading   fossil   fuel   industries.   These   dynamics   remain

underdeveloped in O’Connor’s approach, which often implies that the capitalist state serves

the interest of all capitals and of the ruling class as an entity. 

The SRA contains a further improvement on O’Connor’s framework in its analysis of the

dynamics of different capitalist states based on their forms of representation and institutional

architecture. This analysis elaborates the specific ways that relevant state and non­state actors

negotiate the contests over economic projects and hegemonic visions. Jessop sums up the

importance of this type of approach: 

One must identify the actual modes of political representation at various sites and scales of action

and how they operate, both formally and informally, to enable political forces to voice and

promote their contingent material interests and their unconditional ideal interests (or values)

by virtue of their differential access to centres of political formation, decision making, and

implementation. (Jessop 2016: 61)
Of course, several criticisms can be made of Jessop’s work, but these are not the focus of this

short paper. The SRA stands as an example of how O’Connor’s ideas can be improved upon

by using a mode of analysis that more actively avoids the reification of the state and eschews

a functionalist standpoint. 

O’Connor’s state theory draws strength from its focus on the social foundations of the state

and   the   interminable   struggle   to   meet   the   conflictual   demands   of   accumulation   and

legitimisation. However, the continuing relevance of his framework is undermined by its

reliance on historically specific economic assumptions and its use of a functionalist mode of

analysis   that   does   not   elaborate   the   channels   through   which   state   and   non­state   actors

continually  create  the fiscally self­endangering state. While retaining much of the spirit of

O’Connor’s   legitimacy­seeking   state,   Jessop’s   SRA   explicitly   draws   out   the   negotiation

processes that are necessary if the state is to have any cohesive direction to legitimise at all.

To   avoid   reification,   state   theory   must   recognise   that   these   processes   occur   internally

between state officials and agencies as well as between state officials and actors external to

the state in civil society. While O’Connor’s insights on the state’s tendency to fiscal crisis

have   had   a   far­reaching   influence,   they   can   have   a   greater   impact   in   a   framework   that

eschews   functionalist   and   schematic   interpretation.

Reference List

Castells, M. 1978, City, class, and power, Macmillan, London.
 Gramsci, A., Hoare, Q. & Nowell­Smith, G. 1972, Selections from the prison notebooks of 
Antonio Gramsci, [1st]. edn, International Publishers, New York.

Jessop, B. 2002, The future of the capitalist state, Polity, Cambridge.

Jessop, B. 1990, State theory: putting the Capitalist state in its place, Polity Press, Chapter 7 
‘Accumulation Forms, State Forms and Hegemonic Projects’, Cambridge, U.K. 

O'Connor, J. 1984, Accumulation crisis, ‘Chapter 7: Economic and Social Reproduction and 
the Capitalist State’, Basil Blackwell, New York, N.Y.

O’Connor, J. 1973, The Fiscal Crisis of the State, Chapter 3 ‘The State as a Social Relation’, 
pp. 53­90, St Martin’s Press, New York.

O'Connor, J. ‘The Expanding Role of the State’ in Edwards, R., Reich, M. & Weisskopf, T.E.
1972, The capitalist system: a radical analysis of American society, Prentice­Hall, 
Englewood Cliffs, N.J.

Preteceille, E. 1981, ‘Collective Consumption, the State, and the Crisis in American Society’ 
in Harloe, M. & Lebas, E. 1981, City, class, and capital: new developments in the political 
economy of cities and regions, E. Arnold, London.

Schwartz, A. 1983, Crisis of the Fiscal Crisis? A Review of James O'Connor's The Fiscal 
Crisis of the State (Book Review), Basil Blackwell, etc, Oxford.

Skocpol, T. 1985, ‘Bringing the State Back In: Strategies of Analysis in Current Research’ in 
Peter Evans et. al. (eds) Bringing the State Back In. Cambridge University Press, Cambridge

Wood, E.M. 1995, Democracy against capitalism: renewing historical materialism, 
Cambridge University Press, Cambridge.
Tutor Comment

‘This is an excellent essay that brings a range of Marxist perspectives on the state together in 
a critical way. The focus on critically evaluating the strengths and weaknesses of O'Connor 
was especially good, particularly the critique of the distinction between social capital and 
social expenses. I also liked the complementaries drawn between Wood and O'Connor, and 
the use of Jessop to further develop O'Connor. The critique of O'Connor based on its 
functionalism and outdated­ness was also good, but relied a little to much on the work of 
Schwartz and Preteceille. You could have injected your own voice into this part of the 
argument a little more, e.g. by providing more contemporary examples to update their 
critiques.’