ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Prabhat PatnaikSubscribe to Prabhat Patnaik

The Left in Decline

Empiricisation or the pursuit of a political praxis that is uninformed by the project of transcending capitalism was ultimately responsible for the defeat of the CPI(M) in West Bengal. It is this empiricisation that is far more worrying than the election defeat itself. In a period when many have abandoned the concept of imperialism, the CPI(M) remains steadfast in its adherence to this concept; as long as the concept and the project remain valid, the historical relevance of the party remains unimpaired. But if the party does not arrest the process of empiricisation it has been experiencing and finally ends up accepting the hegemony of bourgeois theory, then it will get supplanted by some other communist formation subscribing to a theoretical position similar to what it has today.

Economic Growth and Employment

The fact that an economy, even when it experiences a higher growth rate in the capitalist segment, is saddled with an increasing unemployment rate, goes against the grain of conventional growth theory as indeed of the basic presumption underlying policymaking. In India, for instance, faced with growing misery in the midst of accelerating growth, the standard response has been that such "exclusion" will disappear if the growth rate can be further accelerated. The proposition that an acceleration of the growth rate in the capitalist segment will be accompanied by an increase in unemployment in the economy as a whole, which is the basic element underlying poverty (as Marx had recognised), cuts at the foundation of all such claims.

On Some Foundational Issues in the Theory of Money

A precondition for the emergence of involuntary unemployment is the fact that substantial labour reserves already exist that make at least a segment of workers price-takers. Not only is "full employment" of all the workers whom capital employs impossible, but a capitalist monetary economy cannot function without such substantial labour reserves as make at least a segment of workers price-takers.

Arjun Sengupta: A Tribute

Arjun Sengupta, the economist who held many positions in academics, government and international organisations, and was chairman of the National Commission for Enterprises in the Unorganised Sector died on 26 September. Two tributes, the first by a fellow economist who was Sengupta's student in the mid-1960s and the second by a more recent younger colleague, who worked with him in the last decade of his life.

A Left Approach to Development

Against the "means-based approach" to development that the bourgeoisie projects, the left must project a "rights-based approach". Since "rights" are guarantors of welfare gains, every winning of rights likewise strengthens them. The acquisition of rights on the part of the people, including rights to minimum bundles of goods, services and security, amounts therefore to winning crucial battles in the class war for the transcendence of capitalism. If the left were to put on its agenda a struggle for people's rights and adopt a rights-based approach to development as opposed to the means-based approach of the bourgeois formations, it would not constitute a retreat into abstract humanism but would be an integral part of the dialectics of subversion of the logic of capital.

The Diffusion of Activities

One of the striking features of the recent period has been the diffusion of manufacturing and service activities from the countries of the core to the periphery. The logic of competitive striving for the export market among the many "labour reserve" economies in the periphery leads to the accumulation of ever-growing reserves and a constraint on domestic absorption. To believe that the contradictions that emerge will disappear if only the economies with current surpluses appreciate their exchange rates is a fantasy. Such an appreciation, if it is not to reduce the level of activity in the appreciating economies, must be accompanied by an enlargement of the fi scal defi cit in these economies, which means both an abandonment of the tenet of "sound fi nance" and increased domestic absorption entailing a retreat from the strategy of export-led growth.

The Crisis of the Left

There is a theoretical ambiguity in the Left that underlies the crisis that it now finds itself in. On the issue of industrialisation, the real issue is whether it occurs through subservience to the logic of capital or it occurs without compromising the dialectics of subversion of the logic of capital. Subscribing to the view that the only immediate choice is between "development" and an attempt to overthrow the system negates any scope for Left politics. The scope for Left politics arises by rejecting this binary choice, by transcending the problematic that the only immediate choice is between subservience to the logic of capital and attempting to overthrow the system. Transcending this problematic is precisely the resolution of the theoretical crisis of the Left. And the possibility of politics that is created thereby will also resolve the practical crisis of the Left.

Reflections on the Left

If the Left accepts the advice given to it to overcome its "outdated" opposition to imperialism and neoliberal policies, this will lead to its incorporation into the structures of bourgeois hegemony. The Left lost votes among the peasants and the rural poor because its antiimperialism did not extend to the formulation of an alternative economic policy.

The Economic Crisis and Contemporary Capitalism

A democratic agenda for coming out of the recession must have at least five elements: first, the nationalisation of financial institutions in the leading capitalist countries where they have basically become insolvent; second, controls on cross border financial flows; third, protection introduced to defend peasants and other petty producers of primary commodities (ideally through agreements among producing countries) in the case of all commodities whose world prices are "demand-determined" (as opposed to "cost-determined"); fourth, a coordinated fiscal stimulus to the world economy provided by a group of leading countries; and fifth, a system of grants whereby the increased surpluses generated by such a stimulus are given as grants to the less (or least) developed countries on the condition that they do not merely add these to their reserves.

The Accumulation Process in the Period of Globalisation

The inflation in food prices of the early 1970s that arose out of excess demand for cereals disappeared in later years not because of any significant supply augmentation, but because it was substituted by an income deflation on the working people, including the peasantry, over large tracts of the world. This income deflation, brought about by the imposition of neoliberal policies, compressed demand and kept food and other commodity prices in check. But over the longer term, income deflation has undermined the very viability of peasant agriculture, adversely affecting supply. All this is part of the process of "accumulation through encroachment" which had been a central feature of colonialism and has re-emerged with a vengeance in the era of globalisation.

The Communists and the Building of Capitalism

The conception of a communist party being always concerned exclusively and immediately with the ushering in of socialism is theoretically erroneous. Further, to infer from the practical policies of the state governments which are an empirical matter, the theoretical positions of the party, is an inversion of reason.

Financial Crises, Reserve Accumulation and Capital Flows

The article constructs a theory to understand a financial crisis in an open third world economy in the context of a sequence of stock equilibria, ensured by inelastic expectations. It then explores the predicament of such an economy when it "opens up" to global financial flows. In the absence of central bank intervention it has to face financial crises. But central bank intervention aimed at avoiding financial crises by stabilising the exchange rate and holding foreign exchange reserves pushes the economy to a perennial stock disequilibrium.

Pages

Back to Top