Republic of the Philippines

CAPIZ STATE UNIVERSITY

1 9 8 0

Pontevedra, Capiz

BARANS NEO-MARXIST THESIS

TOCHE VIC B. DOCE
P.A. 317 Seminar on Economic Planning and Development
COLLEGE OF BUSINESS ADMINISTRATION GRADUATE PROGRAM
DOCTOR OF PUBLIC ADMINISTRATION PROGRAM

LETS HAVE SOME BRAIN

EXERCISES
Exercise of the brain is as important as

exercise of the muscles. As we grow older,

its important that we keep mentally alert.
The saying if you dont use it, you will lose
it also applies to the brain. So

Brain Exercises
Twenty years ago, a plane is flying at

20,000 feet over Germany. If you recall,

Germany at that time was divided into West
Germany and East Germany. Anyway,
during the flight, TWO of the engines failed.
The pilot, realizing that the last remaining
engine is also failing, decides on a crash
landing procedure. Unfortunately, the
engines fails before he has time and the
plane crashes smack in the middle of no
mans land between East Germany and
West Germany. Where would you bury the
survivors East Germany or West Germany

Brain Exercises
Without using a calculator You are driving

a bus from London to Milford Havens in

Wales. In London, 17 people get on the bus.
In Reading, 6 people get off the bus and 9
people get on. In Swindon, two people get
off and four get on. In Cardiff, 11 people
get off and 16 get on. In Swansea, three
people get off and five people get on. In
Carmathen, six people get off and three get
on. You then arrived at Milford Haven.
Question: What was the name of the bus
driver?

WELCOME TO MENSA!!!

Review
Classical Marxism: Marx, Engels,

Luxemburg and Lenin

Neo-Marxism:
Underdevelopment: Baran (1950) and
Frank (1969)
Dependency Theory: Cardoso (1972),
Evans, Chase-Dunn (1975) and Janvry &
Garramon (1977)
World System: Wallerstein (1979)
Response to Neo-Marxism = Orthodox
Marxism: Laclau, Brenner (1977), Phillips,
Warren, and Sender & Smith

Overview
The neo-Marxists came after classical
Marxists. The difference between classical
Marxism and neo-Marxism is that neoMarxists see imperialism as responsible for
underdevelopment. All underdevelopment
draws on Lenin. There are three branches
of
neo-Marxism:
underdevelopment,
dependency, and world-system.

Overview
Baran (1950s) who was a neo-Marxist
underdevelopment theorist developed Lenins
ideas of imperialism by saying it was in the
interests of capitalism to keep the third world as
an indispensable hinterland because it provided
the West with raw materials. The indispensable
hinterland also gave a chance to extract an
economic surplus. Baran (1950s) also suggested
de-linking from the world economy and the
introduction of socialist economic planning.
Therefore, his thinking was a direct challenge to
economic development theory at Barans time.

Overview
Baran introduced the concept of "
economic surplus" to deal with novel
complexities raised by the dominance of
monopoly capital. With Paul Sweezy, Baran
elaborated
the
importance
of
this
innovation, its consistency with Marx's
labor concept of value, and supplementary
relation to Marx's category ofsurplus value.

Overview
According to Baran's categories, "Actual economic surplus"
is "the difference between what society's actual current output
and its actual current consumption," and hence is equal to
current savings or accumulation. Potential economic surplus,"
in contrast, is "the difference between that output that could
be produced in a given natural and technical environment with
the help of employable productive resources, and what might
be regarded as essential consumption." Baran also introduced
the concept of "planned surplus"a category that could only
be operationalized in a rationally planned socialist society. This
was defined as "the difference between society's 'optimum'
output available in a historically given natural and
technological environment under conditions of planned
'optimal' utilization of all available productive resources, and
some chosen 'optimal' volume of consumption."

Overview
Baran used the surplus concept to analyze

underdeveloped economies (or what are

now more optimistically called "developing
economies") in hisThe Political Economy of
Growth. Baran with Paul M. Sweezy applied
the surplus concept to the contemporary
US economy inMonopoly Capital.

About the theorist

Paul Alexander Baran(25 August 1909

26 March 1964) was an AmericanMarxist

economist. In 1951 Baran was promoted to
full professor atStanford Universityand
Baran
was
the
only
tenured
Marxian economistin the United States
until his death in 1964. Baran wroteThe
Political Economy of Growthin 1957 and
co-authoredMonopoly
CapitalwithPaul
Sweezy.

About the theorist

Baran was born inImperial Russia. His
father, aMenshevik, left Russia forVilna(then
Poland) in 1917. From Vilna the Baran family
moved toBerlin, and then, in 1915 back to
Moscow, but Paul stayed inGermanyto finish
his secondary school. In 1926 he attended the
Plekhanov Institute in Moscow. He left again for
Germany in 1928 accepting an appointment as
an assistant on agricultural research with his
advisor, Dr. Friedrich Pollock. Baran remained
in
Germany
associated
with
the
Frankfurt SchoolInstitute for Social Research.

About the theorist

He received the Diplom-Volkswirt (graduate
degree in political economy, equivalent to a
Master's Degree) in 1931 from the Schlesische
Friedrich-Wilhelm University of Breslau. He next
wrote a dissertation underEmile Ledereron
economic planning, and received his PhD from
the University of Berlin in 1933. During these
years in Germany, he metRudolf Hilferding,
author ofFinance Capitaland wrote under the
pen name of Alexander Gabriel for the
German Social Democratic Party journal
"Die
Gesellschaft."

Barans Neo-Marxist Thesis

Application of Marxism to Africa, Asia, &

Latin America.
Western economic & political
domination unfavorable.
Western monopolistic business
transferred to LDCs.
Bourgeoisie in LDCs too weak to
accumulate capital & provide
institutional change.

Baran - coalitions in LDCs

Bourgeoisie ally with moderate leaders of

workers & peasants.

Form New Deal coalition democratic,
antifeudal, anti-imperialist, supportive of
indigenous capitalists.
Indigenous middle & capitalist classes
unwilling or unable to reduce poverty and
provide economic development for masses.

Barans dynamics
Bourgeoisie frightened & forced into alliance with

landed interests & foreign capitalists.

Government supported by foreign economic &
military assistance.
Progressive coalition breaks down.
Overriding interest in preventing socialism.
Needed: progressive income tax; landlords invest
productively, public investment where private
capital does not venture or where monopolies or
where infrastructure required.
Impossible populist forces further polarization,
radicalism & revolt.
Impasse broken by expropriation & ethos of
collective effort.

Baran
Potential conflict of interest between

local & foreign capital.

Nationalism & decline of colonial
economic ties.
Couldnt revolution just transfer from
one elite to another, e.g. USSR?
USSR is Barans model collectivism not
market socialism.
Is transition of squalor, workers poverty
& other human costs inevitable?
Class interests under socialism.

Barans Neo-Marxist Thesis

Several Marxian economists have argued

that the Russian Revolution of 1917 did not

erase divergent class interests. One French
economist argues that the Union of Soviet
Socialist Republics (USSR) abandoned the
socialist road, creating a new ruling class
made up of the Communist Party, the
Praesidium, and the bureaucracy whose
economic interests are antagonistic to
those of Soviet workers (Bettelheim 1978).

THANK YOU!!!