Afghanistan – Past, Present and Future, a Marxist Analysis

On Aug. 30, the last U.S. and other NATO troops after a 20-year shooting war against the Afghani people withdrew from Afghanistan in defeat. On Aug. 15, even before the last U.S.-NATO troops had left, the Taliban entered Kabul as the “president” of Afghanistan, U.S. puppet Ashraf Ghani, fled the country.

It wasn’t only Ghani who fled. What was on paper the extremely formidable apparatus of the Afghan state including a heavily armed standing army of 300,000 soldiers and a massive police force melted over 11 days into thin air. As Taliban fighters drove into Kabul, there were no police on the streets. The only security was the armed Taliban. As these astonishing events unfolded, the U.S. military seized and maintained control of the Kabul airport as panic-stricken supporters of the U.S. occupation, and other Afghans who have no desire to live under the rule of the Taliban fled to the airport. In one incident, Afghans fleeing the Taliban desperately held on to a U.S. plane. Showing the real attitude of U.S. imperialism to those who do its bidding, the plane took off anyway with the Afghans dropping to their deaths.

Many more Afghans celebrated both the end of decades of disastrous war and the fact that another empire — the most powerful of them all — had been defeated by the people of Afghanistan. At least momentarily, Afghanistan is more united than at any time in its history. President Biden claimed a few weeks earlier — pointing to the 300,000-strong Afghan army compared to the 75,000-strong Taliban — that the U.S. withdrawal would not end like the U.S. war against Vietnam had on April 30, 1975.

In fact, the speed of the collapse of the U.S. puppet government dwarfed anything that had happened in Vietnam. In Vietnam, the puppet government had held on for about two years after the last U.S. troops withdrew. In Afghanistan, the puppet government vanished several weeks before the last U.S. troops could be flown out — to the astonishment of the U.S. government, the world, and even it seems the Taliban itself.

On Aug. 26, ISIS-K (the Afghan wing of the Islamic State), a bitter enemy of the Taliban, attacked the Kabul airport with suicide bombers, killing many Afghans as well as U.S. soldiers. However, it seems that many of those who died were also killed by bullets of U.S. and other NATO troops. Perhaps ISIS was frustrated that the war was coming to an end short of the “end of days” leading to the ultimate direct rule of God and his saints, a belief that plays an important role in both the Jewish religion and its offshoots the Christian and Muslim religions. President Biden seems to have forgotten the teachings of his own Christian religion (at least according to Matthew’s Gospel). (1) In his famous “Sermon on the Mount,” Jesus preaches forgiveness, loving of enemies, and turning the other cheek. Instead, President Biden promised vengeance against ISIS-K.

“To those who carried out this attack as well as anyone who wishes America harm,” the U.S. president declared, “know this: We will not forgive. We will not forget. We will hunt you down and make you pay.” President Biden was as good as his word. He sent drones guided by the most modern computer technology the Pentagon has at its command to kill alleged ISIS leaders. This was essentially a police execution that is all too familiar on the streets of the U.S. — particularly for African-Americans — where there is no presumption of innocence, no trial by one’s peers or anybody else for that matter. Among the victims of Biden’s high-tech revenge were ten civilians including seven children.

The woman question

To confuse progressives, supporters of the war against Afghanistan have put great emphasis on the Taliban’s policies toward women. A typical example of this pro-war propaganda dressed up as defense of women’s rights is provided in an AP article by Kathy Gannon, dated Sept. 4, from Kabul. Gannon reports on a demonstration by Afghan women against the Taliban. Gannon reports: “The women’s march — the second in as many days in Kabul — began peacefully. Demonstrators laid a wreath outside Afghanistan’s Defense Ministry to honor Afghan soldiers who died fighting the Taliban before marching on to the presidential palace.”

Notice that the demonstrators honored soldiers who fought in a U.S.-created puppet army that disintegrated even before the last U.S. and other NATO soldiers were withdrawn because there were few people willing to fight and die for what that army represented — namely U.S. control over Afghanistan.

“The Taliban,” Gannon continues, “have promised an inclusive government and a more moderate one but women are deeply skeptical and fear a roll back of rights gained over the last two decades.” Gannon and the AP aim to convince their readers that the last two decades, coinciding with the U.S. occupation and war against the Afghan people, were a period of great gains for Afghan women. Now that the U.S. is out, Gannon wants her readers to believe that the “gains” Afghan women supposedly won as a result of the U.S. war are in mortal danger.

“Flanked by fellow demonstrators,” Gannon writes, “Sudaba Kabiri, a 24-year-old university student, told her Taliban interlocutor that Islam’s Prophet gave women rights and they wanted theirs. The Taliban official promised women would be given their rights but the women, all in their early 20s, were skeptical.”

In the U.S. and other imperialist countries, we live in a society where not most but many young people, including many women, get the chance to attend university. We should, however, not forget that Senator Bernie Sander’s proposal, supported by all progressives including Marxists, for free college education as a right for all Americans, shows no sign of being passed anytime soon. Ms. Kabiri, at least before the Taliban returned to power, was therefore enjoying a privilege still denied in practice to most U.S. women — especially but not only women of color. Kabiri’s prospects for continuing her university studies, at least if she remains in Afghanistan, now indeed are grim.

How many young men, not to speak of young women, in Afghanistan had the privilege of attending university during “the last 20 years” — or ever? At least 75% live in the countryside. For these women — and men — attending university is simply beyond comprehension. However, a small bourgeois layer in Afghanistan, located largely in Kabul, a city that is anything but typical of Afghanistan as a whole, benefited from the U.S. occupation. There were plenty of U.S. dollars circulating in Afghanistan as a result of the U.S.-NATO occupation, and for Kabul residents who could get their hands on enough of these dollars, the doors were opened for higher education and the culture that comes with it, along with access to all the commodities produced by the workers and peasants of the world these dollars could buy. But the vast majority of Afghans — women even more than men — have no access to commodities or modern culture that come with U.S. dollars.

To understand what is happening in Afghanistan, it is necessary to understand what the country is and what it is not. Afghanistan is not a somewhat backward capitalist nation-state. The vast majority of the residents of Afghanistan live in what is called a tribal-clan society and speak many languages.

Ten thousand years ago, all the human residents of the vast Eurasian landmass as well as Africa, Australia, and the Americas lived in such societies. But gradually, over thousands of years, these societies disintegrated and in their place rose societies based on private property, the nuclear family, and the state, whose final form is the capitalist society we live in today. In his “Origins of the Family, Private Property and the State,” Frederick Engels describes the evolution of human society — from a tribal-clan structure where there was no private property and the women had a high social status to a later stage of tribal-clan society called patriarchy where private property began to develop and patriarchy replaced matriarchy. Engels called this development the defeat of the female sex. Ultimately, the further development of private property led to the disintegration of the tribal-clan structure and its replacement by the nuclear family, private property, and the state that exists to defends private property.

This evolutionary process — sometimes punctuated by revolutions — unfolding over the last 10,000 years has led to our “bourgeois society” with its division between the capitalist class, which monopolizes the ownership of the means of production, and the working class, which has only its labor power to sell. All that is left in our modern society from the old tribal-clan society, aside from private property, concentrated in fewer and fewer hands is the nuclear family. And even that is disintegrating, leaving the “sovereign individual” fending for him or herself in the social jungle that is capitalist society.

With the rise of capitalist society comes another institution, the capitalist nation-state, which can also be called the modern capitalist ethnostate. Pre-capitalist states were either geographically small kingdoms, city-states, or multi-national empires — with the small kingdoms and city-states being conquered by the larger multi-national empires. But the modern capitalist state is ethnologically homogeneous. Within our modern capitalist nation-states, most citizens speak the same language, share a more or less common religion, have similar diet and food taboos, and a common culture and dress code.

The modern capitalist nation-state is necessary for the development of the capitalist mode of production because it is the system of political organization that best facilitates the exchange of commodities. The capitalist nation-state guarantees private property in capital and land while allowing the capitalist-controlled government to wall off the national market through tariffs and other trade barriers from the world market, where this is judged appropriate by the capitalists. The nation-state is a tool in the hands of each national capitalist class in the never-ending struggle with the capitalists of other nation-states for control of the world market.

Within a class-state society, individuals are grouped geographically. In contrast, within tribal-clan society, individuals relate to one another through “blood ties,” whether real or mythological. Members of a tribe are, at least in theory, descendants of a common ancestor, at first defined on the maternal line but later, after the defeat of the female sex, by the paternal line. Tribes, in turn, form nations, which are confederations of tribes that also claim common ancestors.

In the Western world (and in this sense, the West includes Afghanistan thanks to the domination of the Muslim religion), the most well-known example of tribal patriarchy is found in the Hebrew-Christian Old Testament. According to the Hebrew Bible, God destroyed the rest of humanity in a fit of rage allowing only one man Noah and his family to survive. Presumably, Noah had a wife (or wives), but the society that produced this ancient myth – a version of which appears in the Hebrew Bible – was so patriarchal that the biblical authors left out this “unimportant detail.”

In the Biblical version of the myth, Noah had three sons – Japheth, Ham and Shem. All living humanity, according to the Bible, are descendants of one of these three men, with all other lines wiped out by God through the flood. Arabs and Jews are supposedly the descendants of Shem — the Semitic (2) peoples. The people of Africa are supposedly descendants of Ham, while the people of Europe are supposedly descendants of Japheth. The ancestors of peoples from other regions of the world are not considered because the Biblical authors had no knowledge of their existence.

One of Shem’s descendants, according to this mythological genealogy, was Abraham, called God’s friend. According to the Bible, Abraham and his wife Sarah were getting on in years but Sarah failed to provide Abraham with a male heir who alone in the patriarchal tribal society could continue his line. The scheming Sarah owned a slave woman named Hagar. Sarah gave Abraham permission to sleep with her slave so that she could bear him a son. Abraham’s son by Hagar was named Ishmael. But then when she was in her nineties, which is normally considered a bit beyond the child-bearing years, Sarah, conceived Issac, who was to become the ancestor of the Israelite tribal confederation out of which the Jews — the tribe of Judah — descended.

Once Issac was born, Sarah turned against Ishmael and demanded that Abraham banish him. Ishmael as well as his mother, Sarah’s slave woman Hagar, were banished at Sarah’s insistence to the wilderness. But God protected Ishmael and his mother Hager. (God unlike Sarah is after all of the male gender and was, therefore, more reasonable than Sarah.) Ishmael gave rise to his own line which became a “great nation,” which according to later Jewish lore is called the Arab nation. When some Arabs were converted to Judaism and then Christianity, they were proud to discover that like the Jews they were the direct tribal descendants – not mere spiritual descendants – of Abraham. (3)

Why did the tribal patriarchal society such as that described in the Hebrew Bible manage to hold on in Afghanistan while it largely — though not completely — vanished from the rest of the globe? Afghanistan is a landlocked and mountainous country. Its mountains are much higher than the Rockies, the Sierra Nevada, and the Cascades in the western U.S. or the Alps in Europe, or even the Andes of South America. Mountain ranges — particularly high mountain ranges — separate people from one another and prevent them from crystallizing into nations in the modern bourgeois sense.

Afghanistan’s valleys are fertile, but this fertile land has remained isolated from the world market by the high mountain ranges and the landlocked nature of the country. As a result, capitalism has been slow to take hold in Afghanistan. Capitalism develops in coastal regions or in river valleys that connect to the oceans that form the highways of the world market, the basis of the capitalist mode of production.

The Afghan Revolution of 1978

This doesn’t mean that capitalism is uninterested in Afghanistan. The country is rich in mineral wealth, and important oil pipelines run through it. Wikipedia estimates the value of the mineral wealth at a trillion dollars, while the website CaspianReport put out by the bourgeois Uzbekistani journalist Shirvan Neftchi, who now lives in Moscow, estimates the value of Afghanistan’s mineral wealth at $3 trillion. Afghanistan has, according to Wikipedia, barite, chromite, coal, copper, gold, iron ore, lead, natural gas, petroleum, precious and semi-precious stones, salt, sulfur, talc, and zinc.

Wikipedia also states: “According to a September 2011 US Geological Survey estimate, the Khanashin carbonatites in southern Helmand Province have an estimated 1 million metric tonnes of rare-earth elements at a potentially useful concentration in the rock, but of unknown economic value. Regina Dubey, Acting Director for the Department of Defense Task Force for Business and Stability Operations (TFBSO) stated that ‘this is just one more piece of evidence that Afghanistan’s mineral sector has a bright future.’”

Further, states Wikipedia: “Lithium is a vital metal that is mostly used in the manufacture of rechargeable batteries for mobile phones, laptops and electric cars. It is speculated that Afghanistan has plenty of lithium. The country’s lithium deposits occur in dry lake beds in the form of lithium chloride; they are located in the western Province of Herat and Nimroz and in the central east Province of Ghazni.”

Both Lithium and rare earths are therefore vital to the 21st-century world capitalist economy. Much of the world’s rare earths are located in China, and the U.S. has long been interested in finding alternative sources of supply. Far from being marginal to the world economy like it was in the past, Afghanistan is positioned to play a vital role later in the 21st century.

After the Russian Revolution, Soviet governments from Lenin to Chernenko were concerned to make sure that Afghanistan was not transformed into a military base against the Soviet Union. Successive Soviet governments encouraged democratic changes in Afghanistan, but the leaders of the Soviet Union never considered this largely tribal country to be ripe for a socialist transformation.

The 1978 Saur (April) revolution was led by the People’s Democratic Party of Afghanistan, founded in 1965. This party has been called by the imperialists as well as many Western socialists and progressives a “communist party.” However, this is not true. To understand why the People’s Democratic Party was not a communist party we have to review some basic Marxist principles.

Genuine communist parties are parties of the proletariat — the class that owns no private property except its labor power, which it is forced to sell to the class that monopolizes the ownership of the means of production — the capitalists. A communist party must therefore be proletarian not only in theory and program but also in composition. Therefore — and the Communist International under Lenin was clear on this point — communist parties can only exist in countries where an industrial proletariat exists. In countries without an industrial proletariat, while there can be communist intellectuals, they cannot form a communist party.

In countries that are truly pre-capitalist like Afghanistan — as opposed to those capitalistically underdeveloped — the Communist International supported the creation of people’s parties that would push for progressive democratic changes — sometimes called national democratic revolutions — as well as close cooperation with the Soviet state. A direct transition to socialism without passing through the stage of capitalist development in these types of countries is possible but only to the extent that they merge economically with already existing socialist countries. In that case, and only in that case, is it possible for a pre-capitalist country to make a transition to socialism without passing through the capitalist stage.

Many Kabul-based Afghani intellectuals admired the achievements of the Soviet Union, which they contrasted with the continued backwardness and stagnation of the still largely tribal Afghan society. Some of these intellectuals may have hoped that eventually Afghanistan, which bordered the Soviet Union, might join the Soviet federation and become a Soviet Socialist Republic. But successive Soviet governments showed no interest in such a transformation.

Unable to form a true communist party, these progressive Afghani intellectuals created the Democratic People’s Party of Afghanistan in 1965. Its program was a series of democratic reforms that included among other things rights for women linked to the abolition of tribal institutions such as the bride price and arranged marriages as well as the right of women to obtain education along with men through the university level. In 1978, facing repression from the Afghan government of President Sardar Mohammed Daoud, and with the support of the Afghan military, the People’s Democratic Party of Afghanistan assumed power in Kabul. However, its authority like all other Afghan governments before it did not extend very far into the tribal countryside.

The tribal leaders saw the democratic reforms supported by the Democratic People’s Party of Afghanistan — such as rights and education for women — as a threat to their age-old authority. The U.S. government, then under U.S. Democratic President Jimmy Carter, saw an opening. It decided to arm and encourage the tribal leaders and feudal warlords to start an insurrection to overthrow the new progressive Kabul government and replace it with one that would do Washington’s bidding. If the tribal leaders-backed insurrection, in turn, backed and armed by the United States, was successful in overthrowing the new progressive government in Kabul, Washington hoped this would enable it to set up a pro-U.S. imperialist government in Kabul right on the Soviet border.

Moscow was alarmed by this development and aided the People’s Democratic Party government in its resistance to the U.S.-sponsored insurgency, though it did not at first send Soviet troops into Afghanistan. On the ground, tribal leaders and village preachers called mullahs, who have great authority in Afghani rural society, organized the so-called Mujahideen, which functioned as a decentralized militia under local tribal and clan leaders. The Mujahideen were well financed by the U.S, Pakistan and Saudi Arabia. The Saudis sent one of their sons, a certain Osama bin Laden, to help organize the rebels, who were painted in the West as heroic “freedom fighters” battling the “communist” government in Kabul. In those days, neither Washington nor the corporate media showed the great concern for the rights of Afghani women that they pretend to show today.

The People’s Democratic Party was not a unified party but a loose confederation of factions that were often in bitter conflict with one another. The top leaders of the PDPA were Nur Muhammad Taraki (1917-1979), Hafizullah Amin (1929-1979), Babrak Karmal (1929-1996), and later Mohammad Najibullah Ahmadzai (1947-1996). Taraki was a writer and is sometimes referred to as Afghanistan’s Maxim Gorky. He was the first leader of the People’s Democratic Party and headed the first PDPA government established in April 1978.

However, Taraki was ousted by Hafizullah Amin in 1979 and was soon killed. The murder of Taraki reportedly shocked the ailing Soviet president and Communist Party General Secretary Leonid Brezhnev. The Soviet leadership strongly suspected — and for good reason — that Amin was attempting to move the Kabul government away from friendship with the USSR and towards an alignment with the United States and its then ally against the Soviet Union, the People’s Republic of China. Fearing that Kabul was about to reach an agreement with Washington at Soviet expense, the Soviet leadership decided to move troops into Afghanistan to prevent this from happening while at the same time helping the besieged Kabul government fight against the U.S.-supported rebels. Amin was soon killed and replaced by Karmal, who remained the head of the PDPA until 1986 when he was replaced by Najibullah at the urging of Mikhail Gorbachev.

By the time Najibullah had replaced Karmal, a major shift in power had occurred in Moscow. The long-ailing Leonid Brezhnev had died in November 1982. He was succeeded in quick succession by Yuri Andropov and Konstantin Chernenko. Both Andropov and Chernenko were already old men in bad health when they were chosen to lead the CPSU and soon died in office. In March 1985, the Central Committee of the Soviet Communist Party chose a much younger — and healthier — general secretary, Mikhail Gorbachev.

Gorbachev represented a new generation of CPSU leaders who had matured in the relatively peaceful years after what the Soviets called “The Great Patriotic War” — World War II. The new Kremlin leaders headed by Gorbachev were qualitatively further removed by both time and ideas from the October Revolution 1917, which had brought the Bolsheviks to power, than any of their predecessors. These new leaders were willing to listen to economic advisers who claimed that modern “Western economics” based on the Austrian and neoclassical schools was correct against Marxism. The Soviet Union, these economic advisers claimed, could quickly solve its economic problems if the Soviet Union fully embraced a “market economy.” As Marxist theory would indicate, and events were soon to prove in practice, this meant the restoration of capitalism with all its consequences including among other things the destruction of the Soviet Union.

Gorbachev was also inclined to embrace “Western” ideas — in other areas as well — including in Afghanistan. If the website CaspianReport, based in what was the Soviet Union, is to be believed — and it seems to be well informed — Gorbachev decided to embrace a new strategy in fighting against the U.S.-supported mujahideen rebels. The Gorbachev leadership, according to CaspianReport, decided to launch a massive bombing campaign against the Afghan rural population aimed at driving the rural tribespeople into the cities where Gorbachev and his advisers believed they would be more easily controlled.

This was similar to the U.S. strategy employed in Vietnam — though Vietnamese rural society was quite different than the one in Afghanistan, and the Vietnamese insurgency in Vietnam had a very different kind of leadership than the one in Afghanistan did. The result was that many embittered young tribesmen fled to Pakistan where they were educated in religious schools known as Madrassas, where they learned a strict form of fundamentalist Islam that was in accord with the values of their tribal society. Lenin would, of course, have been outraged by Gorbachev’s policy of brutally destroying with massive firepower from the air a society made up of impoverished tribal people.

Brezhnev, Andropov and Chernenko, however far removed they were from the revolutionary spirit of Lenin, were unwilling to embrace such a strategy. But the “Western-oriented reformer” Mikhail Gorbachev, at least if the CaspianReport is to be believed, did embrace it, laying the foundations of what was to become the Taliban. In 1987, Gorbachev changed course in Afghanistan and decided to capitulate to U.S. imperialism, just as he was soon to capitulate to U.S. imperialism in Eastern Europe, Germany, and finally the Soviet Union itself. (4)

The U.S. policy of encouraging tribal people to rebel against a progressive government is not unique to Afghanistan. For example, the U.S. encouraged the rebellion of the Miskito people against the Nicaraguan government in the 1980s. Earlier, it had fostered an armed movement aligned with U.S. imperialism among Hmong tribes of Laos during what is called in the West the “Vietnam war.” The U.S. did the same in Vietnam itself. The best fighters for the South Vietnamese puppet government were found among the mountain tribal people of southern Vietnam. Later, the U.S. used people from mountain tribes of Albania against Serbia and what was left of Yugoslavia. More recently, the U.S. imperialists have been manipulating the mountain tribal people of Southwest Asia known as the Kurds.

The U.S. is also encouraging central Asian tribal people known as Uyghurs to rebel against China. The use of tribal people against rising and potentially dangerous capitalist competitors, or any democratic movement opposed by these powers, is an old policy of the established capitalist powers that precedes even the rise of modern imperialism. During the U.S. war of independence, the British used the native American tribes — called “Indians” by the white settlers and “savages” in the U.S. declaration of independence — against the rebelling white colonists, who the British rightly feared represented a danger to their then monopoly of modern industry.

U.S. aims in Afghanistan

With the discovery of vast mineral wealth, Afghanistan has acquired great importance to the U.S. world empire and global economy. In addition, the country is a gateway into central Asia uniting the now huge industrial complex of China with Europe. Afghanistan has potentially great importance to China and what the Chinese government calls the “New Silk Road.” (5)

By 1989, Gorbachev had completed the pullout of Soviet forces from Afghanistan. However, the government of the People’s Democratic Party in Kabul did not fall at that time. It was still in control of Kabul in December 1991 when Gorbachev was frantically trying to negotiate with Washington to save his job as president of what was left of the Soviet Union.

Gorbachev was unsuccessful in this attempt and lost his job when Russian President Boris Yeltsin arranged to have the USSR formally dissolved. At this point, to save his skin Gorbachev agreed to formally resign the post of Soviet president, which was being abolished by the formal liquidation of the Soviet Union. As the Gorbachev regime came to its disgraceful end, the People’s Democratic Party of Afghanistan managed to hold onto power in Kabul into 1992. Finally, however, the PDPA, deprived of any powerful allies with state power that could provide aid, lost control of Kabul and the city fell into the hands of pro-U.S. warlords.

The U.S. had, with Gorbachev’s considerable assistance, succeeded in using the tribes of Afghanistan to destroy the People’s Democratic Party and its attempts at improving the position of women in Afghanistan and realizing other aspects of the national democratic revolution. But after 1992, the tribal Afghanistan society that the U.S. had used to destroy the Saur Revolution now became an obstacle to U.S. plans to dominate Afghanistan and gain control of its vast mineral wealth.

U.S. imperialism aims to transform the tribal people in Afghanistan into proletarians who will work in the extractive industries expected to be developed later this century. And it wants to make sure these extractive industries, as well as the railways and roads that will be necessary to bring the products of these industries to the markets of the world, will enrich U.S. corporations and their mostly U.S. stockholders first of all.

To achieve these aims, U.S. imperialism needs to destroy the tribal society of Afghanistan much as early U.S. capitalism destroyed the tribal societies in what we now call the United States. To achieve U.S. aims, the fertile land in Afghanistan must become private property — not in the feudal sense but the modern capitalist sense — so the tribal people can be separated from their means of production and be forced to sell their labor power to the corporations.

In 1992, Kabul fell under the control of corrupt U.S. paid for and bought warlords willing to do the bidding of American imperialism. In response, the Taliban (6), much demonized in the West, were formed by young tribespeople who had fled to Pakistan to escape Gorbachev’s bombs. There they trained in a form of Islam that is rooted not so much in Islamic religious law as it is in the values of an Afghan patriarchal tribal society much older than Islam. In 1996, the rule of the U.S. puppet warlords was replaced by that of the Taliban. The Taliban now faced a new enemy — their former sponsor, U.S. imperialism and its NATO satellites.

The events of 9/11/2001 gave the George W. Bush administration the excuse it needed to invade Afghanistan under the banner of NATO and crush the Taliban as a first step toward the destruction of Afghanistan’s tribal society and transform the tribespeople into wage slaves for the (mostly) U.S. corporations. The excuse the Bush administration used was that the Taliban had provided refuge to the former U.S. ally Osama bin Laden.

Saudi Arabia itself is a kind of tribal society where the ruling tribe has been converted into landowners who have grown extremely rich off the huge differential oil rents they collect. Bin Laden, a former U.S. ally after the counterrevolutionary destruction of the Soviet Union but infuriated by the introduction of U.S. bases and troops in his native Saudi Arabia — the Islamic holy land — decided to launch his own terrorist struggle against American imperialism, which climaxed on 9/11. (7)

The Taliban was willing to negotiate with the U.S. government when it demanded after 9/11 that Bin Laden be handed over to it. The Taliban proposed to hand over Bin Laden to a Muslim country for trial if the U.S. could provide evidence that Bin Laden was really behind 9/11. But the U.S. was not interested in negotiating with the Taliban over Bin Laden; indeed Bin Laden and 9/11 were only a pretext.

The U.S.-NATO war against the people of Afghanistan

Within weeks after the U.S.-NATO invasion began, the U.S. media began speaking about the Afghan war in the past tense. Even the Taliban, if The New York Times is to be believed, were willing to negotiate a surrender with the hope that perhaps they would be able to retain some influence in the rural areas. After all, the Taliban had no regular army, no air force, no navy, and indeed, unlike Vietnam, no ally with state power anywhere in the world except to some extent Pakistan.

George W. Bush and his advisers as well as the corporate media were convinced there was no way the U.S. could lose this war. What was viewed as the inevitable, and the Bush administration and U.S. corporate media assumed quick, U.S. victory against Afghanistan would help overcome the “Vietnam Syndrome” and thus pave the way for wars against stronger opponents. But the U.S. media was wrong. The Afghan war was only just beginning and it was to become the longest war for the U.S. since the centuries-long war against the tribal peoples the white settlers called “Indians”.

Why the U.S. lost

It wasn’t easy for capitalism to defeat the tribal peoples of North America. But the early capitalist system had a powerful weapon against the tribal peoples – a surplus population out of which the white colonial settlers who were to become the “Americans” were recruited. The leaders of a young British and then American capitalism told the white settlers, we will arm you with modern weapons. If you can crush the “Indians” (the settler slogan was “the only good Indian is a dead Indian”), you will be able to keep the land you stole from them as your private property. And if you can farm — or in some cases mine — it, you will have a chance to grow rich off it and become capitalists yourselves.

But times have changed. After using the “farmer economy” to crush the “Indians,” capitalism in its further development crushed the settler-farmer economy. Today, agricultural production has fallen more and more into the hands of an ever-smaller number of ever-larger capitalist farms. These capitalist farms are now being pushed aside by even larger corporate farms. Today, U.S. farmland is being bought up by multi-billionaires like Bill Gates, the software monopolist of Microsoft, now raking in still more billions from agricultural ground rents.

The high mountains of Afghanistan and its landlocked geography saved it from colonial settlers during the age of settler colonialism. The passing of the small farmer — and mining — economy means that there is no chance that Afghanistan’s fertile valleys can be colonized by “white” farmers from North America, Europe or anywhere else. Nor can its mountains be mined by white settlers. The development of the natural resources of Afghanistan will require huge quantities of capital — or socialist production. Instead of colonial settlers, U.S. imperialism was forced in its war against the Afghans to rely on soldiers and mercenaries who were paid a wage but had no prospect of seizing the land of Afghanistan and farming or mining it themselves to make themselves rich.

Therefore, unlike the British settlers who colonized America and waged a centuries-long war against the “Indians” in return for farmland, the U.S. and other NATO soldiers and mercenaries working for private contractors were interested above all in staying alive and collecting their wages to eventually return to the United States — or the other NATO countries from which they came. The Taliban, on the other hand, were defending their country, villages, clans and society. Using guerrilla tactics, they merely had to wait out the U.S. as the imperialists squandered trillions in the Afghan “forever war.”

When the U.S. finally announced the date — 31 — that they were leaving and it became clear that they meant it, the entire structure of the bourgeois Afghanistan state with its 300,000-member standing army and police forces, having no real base in Afghan society, disappeared overnight. With U.S. and other NATO forces gone, the country is now in the hands of the Taliban though how centralized their rule will be and how long it will last remains to be seen.

The Marxist attitude toward the Taliban victory

First, we should oppose the new economic war the U.S. has launched against Afghanistan. The U.S. has frozen the accounts that the central bank of Afghanistan holds in the Federal Reserve Bank of New York. We should demand that this money be released immediately and the U.S. — and the other NATO countries — recognize the Taliban government in Kabul since it controls the country. The representatives of the now overthrown puppet government of Afghanistan should also be removed from the United Nations and replaced by representatives of the government that actually rules Afghanistan.

Left-wing anti-imperialists across the globe are delighted to see the U.S. and other NATO forces leave Afghanistan in defeat. But left-wingers are also appalled by the victory of the “reactionary Taliban,” especially in its treatment of women. Therefore, many on the left wonder if the victory of the Taliban is a victory in the struggle against imperialism and the U.S. world empire in general, or is it yet another victory of reaction?

After the Russian Revolution, there was much discussion in the Communist International on what should be the attitude of Marxists when imperialist countries find themselves involved in wars of conquest against pre-capitalist countries. In the Second International, right-wing Social Democrats like Edward Bernstein argued that such imperialist wars should be supported because the imperialist countries were bringing the gains of capitalist civilization to backward and “barbaric” peoples.

But the left-wing Social Democrats and the Communists after the Russian Revolution rejected this argument. The main enemy the workers’ movement faces is world imperialism and not the pre-capitalist formations that survive in various parts of the world.

Communists, the leaders of the Third International explained, should strive to achieve proletarian leadership over the struggles of the peoples of pre-capitalist areas wherever possible. Communists should oppose the leadership of these struggles by religious and clerical forces such as that of the Afghanistan Taliban. But if clerical, tribal, and even monarchist forces find themselves at the head of struggles against imperialism anyway, communists are duty bound to support all struggles against imperialism regardless of their leaderships.

The defeat of imperialist invaders, regardless of the leadership of the forces fighting imperialism, is a blow against imperialism, the main enemy of the working class, while a victory of the imperialist invaders strengthens our main enemy. The debacle in Afghanistan will make it harder — though, of course, not impossible — to start new “easy-to-win” wars against “backward” countries. Far from overcoming the “Vietnam syndrome,” U.S. imperialism will now have to overcome the “Afghanistan syndrome.”

For example, in 1935 fascist Italy invaded the African country Ethiopia, then ruled by the autocratic Emperor Haile Selassie. In pre-capitalist Ethiopia, slavery still existed. There were socialists in the 1930s who argued for neutrality in the war between Italy and Ethiopia. Mussolini and Selassie were both “dictators,” these socialists argued. And even under Mussolini, Italy didn’t have chattel slavery while chattel slavery did exist under Selassie. Despite the fact of the existence of slavery in Ethiopia, all Marxists in the 1930s worthy of the name defended Ethiopia against the Italian imperialist invasion. Even if Italy in the 1930s had been a parliamentary republic, like it is today, communists would still have supported Ethiopia in its struggle with Italian “democratic” imperialism.

Similarly, Marxists in the 1930s supported China under the blood-soaked anti-communist dictator Chiang Kai-Shek in his rather reluctant struggle against the imperialist Japanese invaders. Again there were socialists in the 1930s who argued that there was nothing to choose between imperialist Japan and the dictator Chiang Kai-Shek. But the Marxists of those days knew that if the Japanese imperialists were successful in colonizing China, not only would Japanese imperialism but world imperialism would have been greatly strengthened. But if the Japanese were defeated, not only Japanese but world imperialism in general would be dealt a powerful blow. And this is exactly what happened.

But what about the horrible oppression of women by the Afghan Taliban? Surely Marxists don’t defend that! Of course, we don’t! Marxists oppose the oppression of women anywhere it occurs whether in Texas (8) or Afghanistan, just as we opposed slavery in Ethiopia in the 1930s. But we also have to be aware of how U.S. imperialism is misusing the woman question to hide its crimes against the people of Afghanistan and explain to well-meaning progressives what is really involved in all the U.S. wars against the Afghanistan people. These include the war against the Saur revolution from 1979 to 1992, the 20-year military war between 2001 and 2021, and the current economic war – 2021-?.

From the dawn of capitalist colonialism until well into the 20th century, European colonialism justified its crimes against the peoples of the world by claiming that it was saving the souls of the colonized peoples, even when it was physically exterminating them. Salvation for sinning humanity, the colonizers claimed, could only come through the recognition of Jesus Christ as Lord and Savior. It was therefore perfectly okay to wipe out the “natives” physically because their souls were being saved for eternal life.

The decline in Christian belief over the last several centuries — despite the continuing efforts of the capitalist ruling class to prop it up — has forced modern imperialism to largely drop this argument. Its successor has been that imperialism — now mostly U.S. imperialism — must intervene to bring “democracy” to the benighted peoples of the world. However, the Vietnam War and the revelations over the years of the crimes against many other peoples of the world by imperialism and its various puppet dictators and monarchs have undermined this argument. (9)

As a result, the democracy argument, refuted by U.S.-arranged and supervised fake elections in Afghanistan and elsewhere, carries less and less weight. But imperialism has found a new argument better suited to present-day conditions — the woman question. The Taliban has been charged by the U.S. media with forbidding women to work outside the home and attend school while forcing them to wear clothes that conceal almost their entire bodies and with supporting the bride price and arranged marriages.

These charges are true, though the Taliban claims that this time it will allow women to work and attend school within the limits of the Taliban’s interpretation of Muslim religious law. Still, even this more liberal attitude — if that is what it is — falls far short of what the modern women’s liberation movement in the West demands — or for that matter what the Saur Revolution was trying to achieve in Afghanistan itself in the 1970s and 1980s against the opposition of U.S. imperialism.

However, the tribesmen that make up the Taliban view themselves in their own patriarchal way very much as defenders of Afghan women. Under the U.S. puppet regime, most Afghan women enjoyed in practice only the right to be bombed and driven from their homes by the U.S. and NATO forces — “rights” also enjoyed by men and children. Women also enjoyed the “right” to be raped by rampaging pro-imperialist soldiers. Gains the U.S. media claims that Afghan women won in the last 20 years at most benefited a small minority of bourgeois women in Kabul and a few other cities but meant nothing for the overwhelming majority of Afghan women. The argument that Afghan women need the U.S. and NATO to defend their rights is a fraud, just as much as they need the Christian religion to save their souls or for the U.S. Army and Air Force to establish democracy and free elections in their country.

The future of Afghanistan

The new Taliban government will need foreign capital if it wants to develop Afghanistan’s vast natural resources, which potentially could transform the country from one of the poorest in the world into one of the richest. This capital could come from the U.S., Europe and Japan but it could also come from China and to a lesser extent India. Perhaps the Taliban will attempt to play the various potential sources of foreign capital off against one another. The chance of U.S. capital dominating the process of developing Afghanistan’s natural resources has been weakened but far from eliminated by the U.S. defeat in its 20-year military war against the Taliban.

If and when foreign capital does penetrate Afghanistan, the huge mineral ground rents might well transform the upper strata of the Taliban into a class of wealthy rent collectors such as occurred in Saudi Arabia and the other oil monarchies while the mass of the tribespeople are separated from their means of production and are transformed into a modern proletariat. Though this would be a long and painful process, such a development would put the struggle for socialism — and not just a national democratic revolution – on the agenda in Afghanistan.

But there are other possibilities for Afghanistan’s future. If over the coming decades the crises of world capitalism lead to a victory of the socialist revolution, Afghanistan may yet be spared the agony that a transition from a tribal to a capitalist society involves. In the event of the victory of the global working class, one way or another Afghanistan will at some point join the world socialist community at a pace decided by the Afghan people themselves. The Taliban, if it survives that long, will of course resist such a process. But in that case, it will be waging a losing fight.

But there is yet another possibility. World capitalism may within a few decades through climate change, war, or some combination of the above bring about the collapse of modern civilization. If this happens, the victims won’t number in the tens or hundreds of millions like they did in the wars and catastrophes of the 20th century, but in the billions. However, Afghan tribal society protected by its mountain vastness might survive such a disaster.

Then the Taliban will be able to say to tribal society that the society of the capitalists was able to produce for awhile far more wealth than our kind of society can ever hope to produce. It dazzled the world, the Taliban will explain, with its technological and scientific achievements beyond anything our society could ever dream of. But it couldn’t last. Only a society like ours that respects nature and is based on the eternal values handed down by God Himself can survive in the long run. And then the Taliban, or forces like it, might rule Afghanistan for centuries to come and the position of women in Afghanistan will remain just as it has been since the matriarchy gave way to the patriarchy.

The outcome won’t be decided by the Afghans or the Taliban. It will be decided by us, the global working class. Will we finally be able in the 21st century to end the rule of capital and transform world imperialism into world socialism, or will we allow modern society to crash as billions perish. The outcome is not up to the Taliban or the Afghans, it is up to us.

Now back to Shaikh

Now let’s return to our examination of modern capitalism and the work of Anwar Shaikh.

In 1978, Anwar Shaikh wrote a paper for the Union of Radical Political Economists as part of a series of papers on U.S. capitalism in crisis entitled “An Introduction to Crisis Theories.” At that time, the U.S. and world capitalist economies were in the midst of a decade-long economic crisis called stagflation. The U.S. economy had pulled out of the mid-1970s recession that had occurred within the broader stagflation crisis. But the recovery was shaky. Both inflation and unemployment remained stubbornly high during what turned out to be an abortive upturn.

According to Keynesian theory, stagflation — the combination of high inflation, high unemployment, and low to no growth – was not supposed to happen. As a result, Keynesianism was coming under increasing attack by Milton Friedman and his “monetarists” — today called neoliberals – from the right. According to Keynes, inflation was supposed to become a problem only when the economy was “in the vicinity of full employment.” The co-existence of both high inflation and high unemployment created a major policy dilemma for the Carter administration and the Federal Reserve System.

The standard policy measures for situations of high inflation were tax increases and reduced spending — or, more realistically, a reduced rate of growth of spending — by the central government, combined with moves by the central bank to raise short-term interest rates. However, high unemployment — both of workers and machines – required the opposite set of policies: some combination of tax cuts and increased spending by the central government backed by moves by the central bank to lower short-term interest rates.

But what was the central government and the central bank — the Federal Reserve System — supposed to do when both unemployment and inflation were high? The Carter administration and the Federal Reserve leadership gave the impression they had no idea of how to respond to the stagflation crisis. Their policy, if you could call it that, was simply to hope the inflation would go away. But the inflation refused to oblige.

Within a year after Shaikh wrote “An Introduction to Crisis Theories,” inflation sharply accelerated and the crisis came to a head. Carter appointed a new Federal Reserve chairperson, Paul Volcker. Volcker announced that the Fed was going to adopt Milton Friedman’s policy recommendations of targeting the rate of growth of the money supply – the dollars created by the Federal Reserve System plus the credit money (checkbook money created by the commercial banking system) rather than target short-term interest rates. In reality, as Volcker later admitted, this meant allowing interest rates — especially short-term rates — to rise radically to whatever level was necessary to break the back of the accelerating inflation.

But when Shaikh wrote “An Introduction,” the “Volcker shock” was still in the future. While it can be said that in a sense Paul Sweezy and the other economists of Sweezy’s generation were children of the Depression, Shaikh was a child of the 1970s stagflation. By 1978, Shaikh had not only rejected the neoclassical economics he had learned from Gary Becker; he also rejected the “Keynesian-Marxism” associated with the Monthly Review school. It can be said that “An Introduction to Crisis Theories” was a preliminary draft of what was to become his monumental 1,000-page book “Capitalism,” published in 2016, in the wake of yet another economic crisis, that of 2008.

Henryk Grossman and his school

Back in 1978, finding the Monthly Review school unsatisfactory to his mathematical-logical mind, Shaikh looked toward the economic school of Henryk Grossman for an alternative to both neoclassical economics and the Keynesian-Marxist Monthly Review school. Grossman, who had died in the German Democratic Republic (East Germany) in 1950, had little influence among bourgeois economists. No surprise there, since Grossman was a thoroughgoing Marxist of the generation that had witnessed and supported the Russian Revolution. Grossman was a lifelong supporter of the October Revolution and the Soviet Union.

Grossman also had little influence in the international Communist movement or the broader labor movement. The international Communist movement (the Third, or Communist, International had been dissolved in 1943) was thoroughly embedded in the trade union movement engaged in the daily struggles to raise workers’ wages, reduce working hours, and improve working conditions.

Grossman’s theory of “breakdown crises” implied that the way out of an economic crisis short of a socialist revolution was to reduce wages. Breakdown crises in the final analysis, according to Grossman, arise from insufficient production of surplus value. The way the capitalists solve each successive breakdown crisis is to increase the rate of surplus value.

This implies that the trade unions’ insistence on high wages is responsible for high unemployment. Indeed, neoclassical economists claim that if there is not full employment it is because wages are higher than the value of the marginal product the unemployed workers would produce if they were employed by the capitalists. Therefore, according to neoclassical economists, the only way out of a persistent unemployment crisis is to reduce wages. Though they disagree on virtually everything else, Grossman and the neoclassical and Austrian economists all see wage cuts as key to recovery from economic crises as long as capitalism is retained.

These conclusions were not welcome in trade union circles and in working-class parties leading the day-to-day struggles of workers because it implied that the more successful the struggles of the workers were the more likely crises were to break out and the harder it would be once a crisis broke out to achieve recovery (on a capitalist basis). As a result, Grossman’s theories found little support among the Communist Parties that exercised great influence in the trade union movement. Grossman’s theories also had minimal influence in the much smaller Trotskyist movement (9), probably for similar reasons.

Grossman found himself largely outside of the organized workers’ movement from the time he dropped out of the Polish Communist Party around 1925 to the time that he joined the (east) German Socialist Unity Party at the end of his life. Grossman, however, did have a few followers, among them the German worker and Marxist economist Paul Mattick (1904-1981).

In Germany, Paul Mattick was briefly a member of the German Communist Party. He broke with that party well before the Stalin-Trotsky split and denounced the Russian Bolshevik Party and its policies from the left. Unlike Grossman, Mattick considered the Soviet Union to be “state capitalist.” Mattick was associated at various time with some small Marxist organizations — sometimes called “council communists” — who opposed the Communist Parties of the Third International. These groups should not be confused with the followers of Leon Trotsky. None of the groups Mattick was associated with exercised much influence in the broader trade union movement.

Another follower of Grossman (and Mattick) is the British Marxist David Yaffe, who in the 1970s wrote many articles on economics. Yaffe in his youth was a follower of Tony Cliff, who led a split from the British Trotskyists who refused to support the Koreans who in the Korean War of 1950-53) were facing a U.S. invasion. While the “orthodox Trotskyists” defined the countries of the Socialist Camp as degenerated and deformed workers’ states, Cliff and his supporters claimed the Soviet Union and the socialist bloc were “state capitalist” and just as much the enemies of the working class as U.S. imperialism. In the 1980s, Yaffe moved away from Cliff to Grossman’s positions on the Soviet Union and the socialist camp and renounced the theory of state capitalism. Today, Yaffe is a strong supporter of socialist Cuba.

During the 1970s, Shaikh was impressed by the economic analysis of Grossman and his followers Mattick and Yaffe. However, Shaikh has never joined an organized Marxist tendency or party and has spent most of his adult life as a professor of economics at the New School. Though a sympathizer, Shaikh has always stood outside the organized workers’ movement.

Shaikh has a logical-mathematical mind that rejects inconsistency and muddled thinking. This goes hand in hand with a love of algebra and knowledge of mathematics in general, which he acquired first as an engineering student and then a student of neoclassical economics. However, unlike some other writers, he never used his formidable knowledge of mathematics to mystify the non-mathematical reader and emphasizes that mathematics itself is no substitute for sound economic reasoning.

In his “Introduction to Crisis Theory,” Shaikh deals with three crisis theories. One is known as underconsumption theory, the second is the profit squeeze theory, which blames the falling rate of surplus value during prosperity for capitalist crises, and the third is the fall in the rate of profit caused by a rise in the organic composition of capital. In the history of Marxism, Grossman is the most prominent exponent of crises caused by a fall in the rate of profit tied to the rising organic composition of capital. This is the camp Shaikh has supported from the late 1970s until the present.

Shaikh’s critique of underconsumption crisis theories in 1978

“The basic tenet of underconsumption theory,” Shaikh wrote in his 1978 article, “is that the demand for consumer goods and services determines not only the production level of Department II (consumer goods), but also that of Department I (producer goods).” The working class, which produces surplus value, cannot buy back its entire product, the underconsumptionists point out correctly. The workers can buy only the commodities enabling them to reproduce their labor power.

As a general rule, members of the working class spend their entire wage income on items of personal consumption. The rest of the commodities annually produced replace the existing constant capital used up (simple reproduction), expand the existing constant capital (expanded reproduction), and comprise items of personal consumption (necessary goods and luxuries) purchased only by capitalists.

According to underconsumption theory, production in the producer goods industry, Shaikh writes, “is ultimately regulated by the input requirements of the consumer goods industry: the demand for producer goods is, therefore, ‘derived’ from the demand for consumer goods”. Let’s suppose we imagine we have an economy that is engaged in simple reproduction that shifts to expanded reproduction. Shaikh goes on: “ … the capitalist class at first spends entirely on personal consumption. Now suppose they cut back their consumption to $150,000, and the remaining $50,000 they invest by using $30,000 to buy producer goods (from the inventories of Department I) and $20,000 to hire workers (out of the reserve army of the unemployed). The net drop in consumer demand is only $30,000 since the drop in capitalist consumption demand is partially offset by the extra consumption of the newly hired workers. Nevertheless, demand for consumer goods does drop, so that sales in Department II will fall which in turn means that its own demand for producer goods will fall, thus decreasing sales in Department I.”

According to the underconsumptionists, the basic aim of production is the satisfaction of human needs — the production of items of personal consumption. If, the underconsumptionists reason, we increase investment from zero net investment — simple reproduction — personal consumption has to drop. The capitalists end up increasing the ability to produce consumer goods but cut the demand for consumer goods. The result is an overproduction of consumer goods that then leads to cuts in investment leading as a secondary effect to overproduction of the means of production — Department I — as well. The result is that, according to underconsumptionist theory, in Shaikh’s words, “Internally generated accumulation negates itself.”

But now if we are to follow the underconsumption logic, we have proved too much. We have proved the impossibility of the capitalist mode of production as a system of expanded reproduction. But since expanded capitalist reproduction exists in the real world, this means that demand must be coming from outside the capitalist system.

Different schools of underconsumption thought

Shaikh divides underconsumption theorists into what he calls radical and conservative. He also notes that the early underconsumptionists wrote before Marx and lacked the concept of Department I and Department II, which gradually became known after Engels published Volume II of “Capital” in 1885. According to Shaikh, early pre-Marxist underconsumptionists were not always aware that their theory implied that what Marx called expanded capitalist reproduction was impossible. The pre-Marxist underconsumptionists imagined that there was a kind of optimum rate of accumulation. If the accumulation was too low, there would be economic stagnation. But if accumulation was too rapid, general gluts — overproduction — would bring capitalist accumulation to a screeching halt. The remedy was to slow down economic growth enough to avoid the dreaded “general glut.”

Shaikh quotes Michael Bleaney (1950 – ) from his book “Underconsumption Theories”: “The general position of these writers was that there is a limit above which the rate of accumulation becomes dangerously high, threatening to precipitate a slump. But the logic of the argument as they develop it is that this limit is a zero rate of accumulation, as is effectively pointed out by Chalmers. Thus they are caught in a trap, in which either they must draw back from the brink and discard part of their results, or they must openly state the absurdity of their conclusions.”

Shaikh notes: “The first major economist to land himself in this dilemma was Thomas Malthus (1820s). True to the underconsumptionist tradition, Malthus argued that it is the demand for consumer goods which regulates production, so that only a certain rate of growth was ‘sustainable.’ Of course, given the logic of his argument and the conclusion implicit in it, Malthus was never able to say just what this ‘sustainable’ rate of growth was.”

Shaikh goes on: “In Malthus’s hands this tendency towards underconsumption became a reactionary apologetic for feudal land-owners, whose high living and conspicuous consumption was presented as a welcome counter-balance to the tendency of capitalists to (over) save. (Malthus is also famed for his attack on the working class through his so-called laws of population. Then, as now, these brutish ‘natural laws’ were never meant to represent the behavior of the ‘civilized’ ruling classes).”

In addition to Malthus’s reactionary underconsumptionism, there was a kind that is much closer to those of progressives today. The founder of the “progressive” underconsumptionist school was the Swiss economist Simonde de Sismondi (1773–1842), considered by Marx to be, along with Ricardo, the last of the classical economists. “Sismondi himself,” Shaikh writes, “championed radical changes in income distribution in favor of peasants and workers, and looked to the state to carry these and other economic reforms out.”

In addition to the bourgeois pre-Marxist “underconsumptionists,” there is also the post-Marx bourgeois underconsumptionist schools. One of the most important representatives of this school was the Englishman John Hobson (1858-1940), who was to exercise a great influence on Marxists including Lenin as anybody who has ever read Lenin’s famous pamphlet “Imperialism” knows. Hobson also influenced Baran, Sweezy, and John Maynard Keynes. “Hobson,” Shaikh explains, “begins in the now familiar way of underconsumptionists. He explicitly identifies the ultimate object of all production, even under capitalism, as being the production of consumer
goods.”

“Hobson,” Shaikh notes, “also introduces the concept of the ‘surplus’, which plays an important role in his subsequent analysis. Generally speaking, the ‘surplus’ is defined by Hobson to be the excess of the total money value of the output over the strictly necessary costs of producing that output.” Anybody familiar with Baran and Sweezy’s Monopoly Capital (first published in 1966) or books and articles written by members of the Monthly Review school will recognize not only the Hobson concepts but even Hobson’s terminology.

According to Hobson, the increasingly bloated incomes of the capitalists and landowners and their increasing inability to spend all their income on items of personal consumption tends to lead to underconsumption, overproduction and stagnation. The rich capitalist countries try to escape from the resulting economic stagnation by seizing pre-capitalist countries and colonizing them. However, Hobson believed there was a better way to deal with underconsumption and the stagnation it allegedly breeds than the competitive seizure of territories by the “great powers,” which leads towards war.

“Let any turn in the tide of politico-economic forces divert from these owners their excess of income and make it flow, either to the workers in higher wages, or to the community in taxes,” Hobson wrote, “so that it will be spent instead of being saved, serving in either of these ways to swell the tide of consumption — there will be no need to fight for foreign markets or foreign areas of investment.” (quoted from Shaikh). Hobson’s views as expressed here still exercise great influence on progressive thinking today, if not directly, then through their influence on the Monthly Review school.

Marxist underconsumption theories and Rosa Luxemburg

The semi-Marxist Ukrainian economist Mikhail Tugan-Baranowsky, Shaikh explains, took opposition to underconsumptionist theory to its logical extreme. Tugan-Baranowsky claimed that if only the correct proportions were maintained between Departments I and II, consumption represented no barrier to capitalism whatsoever. To maintain these correct proportions as the organic composition of capital rises, it is necessary for Department I to grow faster than Department II. There is, of course, always the possibility that the correct proportions between the two departments will not be maintained, which will lead to crises that disrupt capitalist expanded reproduction.

This led to the view that became widespread among the theoreticians of the Second International that crises arose out of mere accidental disproportions between Department I and II. Tugan-Baranowsky’s influence encouraged the view that the growing “organization” of monopoly capitalism in the form of syndicates, cartels and trusts and bank control over industrial enterprises could limit or even eliminate crises. “Both “Tugan-Baranowsky and Hilferding,” Shaikh writes, “were later to argue that since it was the anarchy of capitalism which led to crises, planning would eliminate crises.” However, Shaikh continues, “Rosa Luxemburg refused to accept this resolution of the debate.” He quotes Luxemburg as stating that if “capitalist development does not move in the direction of its own ruin, then socialism ceases to be objectively necessary.”

Underconsumptionist breakdown theory

Underconsumptionist theory implies that if there isn’t a source of extra demand that is somehow external to the system, capitalism cannot realize surplus value in money form — profit — if it engages in expanded reproduction. If we combine Marx’s view that capitalism can exist only as a system of expanded reproduction with the underconsumptionist view that capitalism cannot carry out expanded reproduction without a market that is somehow external to the system, you draw the conclusion that a pure capitalist society consisting only of workers, and capitalists (and their hangers on) cannot exist.

“Imagine,” Shaikh writes, “that at the end of a production cycle the whole social product is deposited in a warehouse. At this point capitalists come forward and withdraw a portion of the total product to replace their producer goods used up in the last cycle, and workers come and withdraw their means of consumption. This leaves the surplus product, from which capitalists withdraw a portion for their personal consumption. Now Luxemburg asks, where do the buyers for the rest of the product come from? (This is, of course, the traditional underconsumption problem of filling the ‘demand gap’).”

If we assume that Luxemburg’s logic is sound here, this raises the question of how has capitalism been able to carry out expanded reproduction over several centuries. Luxemburg concluded that the extra demand must be generated outside of capitalist production. But where does this extra demand come from? Shaikh explains, “Luxemburg notes that the Malthusian solution of a third class of unproductive consumers makes no sense, since their revenue could only come from profits or wages.”

“She therefore argues that capitalist accumulation requires a strata of buyers outside of capitalist society who continually buy more from it than they sell to it. Thus trade between capitalist and non-capitalist spheres is a prime necessity for the historical existence of capitalism, and imperialism necessarily arises as capitalist nations struggle over control of these all important sources of effective demand.”

In a footnote, Shaikh explains that “Readers familiar with Volume I of Capital might recall that Marx distinguishes two types of circuits involving purchase and sale: C-M-C and M-C-M’. In the former the object is consumption, but in the latter the object is the expansion of capital. It is the latter which is the dominant (regulating) circuit of capitalist production. Luxemburg forgets this.”

Shaikh’s point is sound. But this is one of the relatively few places in Shaikh’s entire article where he refers to money. For the most part, Shaikh – like most other Marxist writers of either the Second or Third Internationals or who are independent treat the trade that the capitalists of Departments I and II engage in with each other as though it was barter. These Marxists, including Shaikh, forget that the individual capitalists that make up Department I purchase the consumer goods they and their workers buy from Department II not with means of production but with money. Similarly, the capitalists of Department II purchase the means of production produced by the capitalists of Department I not with consumer goods but also with money.

If the trade between Department I and Department II is a barter trade, there is no way that any disproportion between the two departments can ever represent a general overproduction of commodities that Marx and Engels (but not most modern Marxists including Shaikh) repeatedly describe as the essence of modern cyclical capitalist crises. At most, disproportions between the two departments of production can represent a partial overproduction of some commodities backed up by a shortage of other commodities.

The Great Depression and Paul Sweezy

The Depression of the 1930s revived once again the whole question of the historical limits of capitalist expanded reproduction. Capitalism had survived the crises associated directly with World War I except on the territory of what had become the Soviet Union. By the middle 1920s, Luxemburg (who had been murdered by German fascists in 1919 with the support of the Social Democratic government) was thoroughly and well repudiated by the theoreticians of both the Second and Third Internationals. Capitalist expanded reproduction to all appearances was progressing normally once again. It was assumed, especially by Nikolai Bukharin, the chief theoretician of the Communist International, that this would continue unless or until it was again disrupted by a new world war.

But then came the crisis that began in 1929. This was not merely the usual cyclical crisis — though it appeared to be at first — but developed into a massive breakdown in the process of capitalist expanded reproduction. This “breakdown” was to continue, first in the form of the Depression and then the World War II war economy for 15 years. Even today when pressed, bourgeois economists will often admit that they don’t really understand what caused the Depression — that is, the breakdown in capitalist expanded reproduction — though this does not prevent them from adding that “we” know how to avoid a similar disaster in the future. A new generation of left-wing and Marxist economists out of which Paul Sweezy emerged as a central figure attempted to answer the question of why the Depression occurred.

‘Theory of Capitalist Development’

According to Shaikh, Sweezy made two attempts to develop a theory of capitalist crises and stagnation. The first was in Sweezy’s “Theory of Capitalist Development,” published in 1942. “As capitalism develops … ” Shaikh writes, “mechanization proceeds apace and it takes more and more machines and materials to back up one worker; this means that capitalist investment expenditures on producer goods rise faster than those on wages. … It appears, therefore, that the capacity to produce consumer goods expands faster than the consumption demand of workers. A ‘demand gap’ thus opens up.”

Sweezy believed it unlikely that this demand gap would be filled by increased capitalist consumption because as capitalism develops the incomes of the capitalists become so colossal they are unable to spend an ever-declining fraction of their income on personal consumption. Shaikh quotes Sweezy: “ … it follows that there is an inherent tendency for the growth of consumption to fall behind the growth in the output of consumption goods … this tendency may express itself either in crises or in stagnation, or both.”

Shaikh refutes Sweezy’s underconsumptionist position as of 1942 as follows: “The fundamental error in Sweezy’s analysis is the traditional underconsumptionist one of reducing Department I to the role of an ‘input’ into Department II. Once this assumption is made, it necessarily follows that an increase in production of producer goods may be used to make producer goods also, and as we noted in the critique of Luxemburg, expanded reproduction requires that they be so used.”

Sweezy’s second attempt

According to Shaikh, Sweezy made a second attempt to explain capitalism’s crises and stagnation periods in “Monopoly Capital,” which he wrote with Paul Baran, first published in 1966. “Monopoly Capital,” Shaikh explains, “written in the light of Marx, Keynes and Kalecki, no longer restricts itself to Department II or consumer demand alone. Instead, it is argued here that modern capitalism has a tendency to expand total productive capacity faster than internally generated effective demand — so that in the absence of external factors [emphasis Shaikh’s], monopoly capitalism would sink deeper and deeper into a bog of chronic depression.’”

The task then, despite Baran and Sweezy bringing in monopoly, is in the end no different than the traditional underconsumption problem of explaining not stagnation or depression but rather why even monopoly capitalism can ever grow. To explain continued capitalist growth, Shaikh writes, “ … Baran and Sweezy point to major innovations (steam engine, railroads, automobile), imperialist expansion and wars, and the stimulation of demand in general through advertising, government policy, etc., as being crucial factors in overcoming the inherently stagnant nature of monopoly capitalism.”

Shaikh’s criticism of ‘Monopoly Capital’

Suppose, Shaikh writes, the capitalist investment is “large enough to expand capacity but not large enough to purchase the preceding period’s supply — then of course productive capacity will outrun effective demand and the system will be faced with a demand gap or ‘realization problem.’ This is precisely the argument implicit in Baran and Sweezy’s assertion that the (potential) surplus expands faster than the system’s ability to absorb it. Yet, though they tend to lay much of the blame for this problem on monopoly, they do not discuss why monopolists would persist in over-expanding productive capacity in the face of insufficient demand.”

In other words, thanks to capitalist monopoly, investment is strong enough to expand productive capacity but not strong enough to generate the demand necessary to buy the increased product that can be produced with the help of the additional capacity. Baran and Sweezy in “Monopoly Capital” see this as inherent in the nature of monopoly — it presumably wasn’t a problem in the earlier phase of capitalism that ended in the late 19th century when “perfect competition” prevailed.

Shaikh quotes Erik Olin Wright (1947-2019): “The most serious weakness in (this) underconsumptionist position is that it lacks any theory of the determinants of the actual rate of accumulation. … Much underconsumptionist writing has, at least implicitly, opted for Keynes’ solution to this problem by focusing on the subjective anticipation of profit on the part of capitalists as the key determinant of the rate of accumulation. From a Marxist point of view this is an inadequate solution. I have not yet seen an elaborated theory of investment and rate of accumulation by a Marxist underconsumptionist theorist, and thus for the time being the theory remains incomplete.”

What actually determines accumulation — or, if you prefer, investment? It is the rate of profit both for the economy as a whole and relative rates of profit in different branches of production. Capital always flows away from branches with lower than average rates of profits to branches of higher than average rates of profit. We learn from Marx that profit is nothing but the money form of surplus value. Paul Sweezy was so concerned about the realization of surplus value that transforms surplus value into money profit that he neglected the production of surplus value.

Keynes, who also avoided the question of the production of surplus value much like the vampire avoids the cross, explained capitalist investment decisions being determined by the capitalist expectations of profit. But surely these “expectations” are not based on mere whims but reflect some reality that exists outside the minds of the individual capitalists. In contrast, to the problem of the realization of surplus value that has dominated underconsumptionists from the days of Sismondi to the present, Shaikh (and Grossman before him) are above all interested in the production of surplus value. This is especially true of the young Shaikh in 1978 though this will be modified somewhat as we will see in the mature Shaikh of “Capitalism”.

This brings us the family of crisis theories that Shaikh subscribes to that blames real-world capitalist crises — and depression and stagnation periods — on an insufficient production of surplus value. These can be divided into two sub-families. One is the so-called profit-squeeze theory. According to this theory, during prosperity the balance of forces on the labor market shifts in favor of the sellers of labor power, the working class. As unemployment falls, competition among the workers for jobs declines while competition among the capitalists for workers increases. The result is a declining rate of surplus value and eventually an absolute fall in the mass of surplus value, a situation that Marx called the “absolute overproduction of capital.” Investment collapses triggering an economic crisis.

The other sub-family of the “not enough surplus value” school involves what Marx calls the organic composition of capital. As capitalism develops, the constant capital — factory buildings, machines, and raw and auxiliary material — rise relative to the variable capital, the purchased labor power of the working class. Assuming the rate of surplus value remains unchanged — as it does in the Bauer-Grossman model we examined last month — the rate of profit will decline as the organic composition of capital rises. Eventually, not enough surplus value will be produced to sustain the existing level of employment in the absence of a rise in the rate of surplus value, causing the system – or at least “full employment” — to “break down.”

To be continued.


1 Compare President Biden’s statement with the words of Jesus Christ in his Sermon on the Mount as recorded in Matthew 5:38 and 5:39: “You have heard that it was said, ‘Eye for eye, and tooth for tooth.’ But I tell you, do not resist an evil person. If anyone slaps you on the right cheek, turn to them the other cheek also.“ (back)

2 The modern conception of the “Semitic” peoples dates to the 19th century when European linguists discovered that Arabic, Hebrew, Aramaic as well as the languages of Ethiopia are closely related to each other just like the languages of Europe and India called “Indio-European” are also closely related. In the hands of 19th-century European racists, this got mixed up with the concept of “race,” which pitted the “Semitic” Jews against the “Aryan” — Indio-European — race, which are supposedly locked in eternal conflict with one another. This idea became the basis of the ideology of Nazi Germany. (back)

3 St. Paul argued that the Jewish Law — Torah — is no longer necessary because the followers of Christ, soon to be known as Christians, were spiritually at least the descendants of Issac, who according to Paul represent “freedom” — from the Jewish Law. Arab Christians didn’t like the implication that since they were biological descendants of Abraham through the slave women Hagar, they are inferior to the Jews and other Christians who spiritually are descendants of Abraham through his free wife Sarah.

Islam can be viewed as a kind of Christianity that observes a modified version of the Jewish Law and rejects Paul who in breaking with Judaism insulted the alleged tribal ancestor of the Arabs Ishmael. Today the great majority of Muslims, including the residents of Afghanistan, are non-Arabs who are only “spiritual” descendants of Abraham and Ishmael, but this was not the case when Islam began in the seventh century. (back)

4 Within a few years, the majority of the post-1985 Soviet leadership including Gorbachev were to break with any pretense of dommunism and Marxism completely and became open anti-communists. (back)

5 The New Silk Road is an initiative by the government of China to develop both land and sea routes that will link China’s industrial economy to Europe. U.S. imperialism is strongly opposed to the New Silk Road since among other things it threatens Europe’s submission to the U.S., which forms the cornerstone of the U.S. world empire. (back)

6 Taliban is a word borrowed from the Arabic language, which means students. (back)

7 Oil monarchies like Saudi Arabia had very low populations before the discovery of oil enriched the small tribal populations that are native to these regions. Therefore, there is not much of a native proletariat in these regions. Instead, the oil monarchies depend on workers shipped in from abroad — largely Muslim people from Pakistan and India. These workers are cruelly — and in the case of women often sexually — exploited. They have no prospect of remaining in the oil monarchies and plan to return to India or Pakistan. The lack of a working class with any prospect of remaining in the oil monarchies has made these monarchies difficult to overthrow from within. This is why the oil monarchies are so valuable to U.S. imperialism. The larger native population in Afghanistan means the chances of developing a native proletariat as the tribal society disintegrates is much better in that country than it ever was in the oil monarchies. (back)

8 The U.S. state of Texas had just passed a law that not only bans abortion later than six weeks or whenever a fetal heartbeat can be detected. It awards any private person anywhere in the world who discovers that an abortion later than six weeks has taken place to sue in court the people involved in the abortion and collect a $10,000 bounty from them.

The Republican faction of the Supreme Court, three of whose members were appointed by Donald Trump, refused to declare this law unconstitutional and it has gone into effect. A country that can allow a state to pass such a barbaric law and tolerates Supreme Court “justices” who refuse to declare such a law unconstitutional has no right to lecture Afghanistan or anybody else about women’s rights. (back)

9 The leading Trotskyist economist was Ernest Mandel (1923-1995). In his “Marxist Economic Theory,” first published in 1962, Mandel, who had been a member of the economic studies commission of the Belgian General Federation of Labor until the early 1960s, was quite dismissive of Grossman’s work. However, in “Late Capitalism,” first published in German in 1972, the influence of Grossman on Mandel is very strong. (back)


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