The abortive 18th Brumaire of Donald John Trump

Joseph Biden was sworn in as the 46th president of the United States and Kamala Harris as vice president on Jan. 20, 2021. (1) But it was an inauguration unlike any other. Washington was occupied by 20,000 National Guard troops. Nobody without a pass was allowed anywhere near the ceremony. One reporter on the eve of Biden’s inauguration said something to the effect that on Jan. 20 Washington did not look anything like America. But the point is this is exactly what the United States of America looks like now. The real questions are, how did the U.S. get this way and where is it going?

Four years earlier, the capitalist ruling class looked on with a mixture of great hope and some trepidation as Donald John Trump was sworn in as the 45th president of the United States. On one hand, Trump was a brazen amateur compared to even the least prepared of his predecessors. He had never served in the armed forces or held an elective office, nor had he served in a U.S. cabinet or any other government post. Indeed, he never held any job outside his family business besides his role as a TV showman.

Once in office, Trump wasted no time in starting a trade war with China but also with the U.S.’s imperialist satellite “allies” such as Germany and the other EU countries. There were fears in the ruling circles that this was endangering the world order that had emerged out of the U.S. victory against Nazi Germany and Imperial Japan. This world “order,” which Joseph Biden is now trying to reinvigorate, was based on a compromise agreement between the victorious U.S. and its defeated imperialist rivals that emerged after World War II.

The defeated imperialists got access to the U.S. home market and other markets as well as sources of raw materials that were “protected” by U.S. military power. In return, the defeated axis powers agreed never to challenge the U.S. again in the political and military spheres. Soon, the U.S. imperialist allies during World War II such as Great Britain found themselves slipping into a relationship with the U.S. not so different than its defeated imperialist enemies. However, 72 years of uneven capitalist development that has occurred since 1945 had increasingly undermined this order by the time Trump assumed office.

Already on the eve of Trump’s rise to the presidency, there was a general agreement among U.S. capitalists that Germany was taking too many markets away from the U.S. and other capitalist powers. Even more importantly, there was the entirely new situation created by the shift of much of the world’s industrial production to China.

Back in 1945, China was viewed as little more than a dumping ground for surplus commodities produced elsewhere. Today in absolute terms, China has the highest level of industrial production in the world, a position that had long been occupied by the United States.

In the four years of Trump’s term, his racist comments and anti-immigration actions delighted his white racist MAGA base. This, however, was not without its dangers for the capitalist ruling class. As early as the year 2040, the U.S. is expected to have a non-white majority. Even sooner, the majority of the U.S. working class will consist of people of color.

However, many, perhaps most, of the U.S. capitalist ruling class was won over to Trump by what was described as the most “pro-business” administration in history. From his repeated attempts to repeal “Obamacare,” his huge 2017 tax cut for the rich, his mocking of the dangers of climate change, and his deregulation policies to his support of “beautiful clean coal,” combined with his anti-union policies, much of the originally skeptical business community became enthusiastic Trump supporters. Increasingly, he was viewed by the capitalists as a second Reagan. Like Reagan, Trump was reliably “pro-business.” And much like Reagan, he maintained a solid base among racist whites, including backward sections of the working class.

A year ago, with the election season getting underway, the media was filled with hopeful articles predicting Trump’s reelection based on the 50-year-low U-3 unemployment rate as well as the rate of new applications for unemployment insurance that were also at 50-year lows. The “low” unemployment numbers were combined with what really counts for the capitalist ruling class — record-high stock market prices — which Trump continuously boasted about. (2)

When it became clear in March 2020 that the COVID-19 pandemic was hitting the United States with devastating force, Trump’s policy was to do everything he could to “reopen America for business,” even as the pandemic accelerated with the U.S. leading the world in cases as well as deaths. Total deaths are now well north of 400,000 and climbing.

Trump repeatedly lied about the pandemic. First, he claimed that COVID was the “China flu” and would not affect the United States. Then he claimed repeatedly that the pandemic was about to go away, somewhat like Herbert Hoover in another time claiming that “prosperity was just around the corner.” Trump often made other ridiculous statements about the pandemic, revealing his complete ignorance of basic science. At one point, he even suggested that bleach could be used to “cure” the virus as his embarrassed medical advisers struggled to maintain calm expressions. After all, bleach does kill “germs” doesn’t it? All this made him an object of ridicule in the anti-Trump “Party of Order” press.

These statements cost Trump the support of many older white people who, though they held to more traditional — among whites — bigoted views on race, gender roles, and attitudes toward LGBTQ people, also were more likely to die from the virus than younger people with stronger immune systems.

Before the Nov. 3 election when Trump was asked whether he would respect the election results, he answered “it depends.” Most people still assumed that the president was bluffing. The U.S. constitutional system doesn’t say that the president leaves office only if he accepts his defeat in the election. When the election came, African Americans, Hispanics, Native Americans, Muslims, and LBGTQ people turned out in what by U.S. standards were great numbers and voted for the Biden-Harris ticket. This didn’t reflect widespread enthusiasm for Biden-Harris but rather a deep hatred of Donald Trump and all he stood for.

In the popular vote, Trump was soundly defeated by a 7 million vote margin. But in the Electoral College, which strongly favors Republicans, it was a close thing because if as few as 77,000 votes had gone the other way in “swing states,” Trump would have been “reelected” for a second term. Such is the working of what passes for bourgeois democracy in the United States.

But Trump was defeated and the Biden-Harris ticket prevailed. Once this became clear and the election was unofficially called on Saturday, Nov. 7, first by the Associated Press and then by The New York Times and lesser organs of the capitalist press, Trump refused to respect the unofficial but very real parts of the U.S. Constitution that require the losing Democratic or Republican candidate to concede to the victorious candidate. It was only at this point that the capitalist class — not only its Party of Order leaders — began to turn decisively against Trump.

The role of the concession speech

The concession speech is designed to convince the supporters of the defeated candidate that the election really represented the will of the American people as a whole. Therefore, the next president represents the one legitimate, democratically elected and constitutional government and therefore must be obeyed. The capitalists know that whether they like a particular administration or not, it is still their only government until the next election. And they also know that if their government is to rule effectively, it must be seen as legitimate by a great majority of the people.

This is why Richard Nixon conceded to John F. Kennedy in November 1960, though there was a strong case to be made that the election was stolen from Nixon by the Chicago Democratic Machine and its allied “Outfit,” aka “the Chicago mob.” It also explains why Albert Gore conceded to George W. Bush in 2000, even though Gore had won the popular vote by a half-million votes and it appears that he won the Florida vote as well. And it explains why Hillary Clinton promptly conceded the election to Donald Trump in 2016, though it turned out that she had defeated Trump by almost 3 million votes in the popular vote.

This illustrates the centralist part of what passes for bourgeois democracy in the United States. Once “the people” make their decision, the majority must submit to the majority, or as was the case in 2000 and 2016, the majority must submit to the minority. Donald Trump is the first U.S. president who did not concede defeat even after the outcome of the election was no longer in reasonable doubt. It was pretty clear that Trump had lost the Electoral College, which is what counts in U.S. presidential elections, by Nov 6. But the Associated Press decided to give Trump an extra 24 hours to accustom himself to his defeat, cool down, and concede the election. Then business could proceed as usual. But Trump refused to concede. Instead, he at first cautiously but then louder and louder proclaimed that the election had been stolen from him and his reactionary MAGA base. The president claimed that he lost only because “illegal” mail-in ballots were counted while Trump ballots were thrown out. But he could offer no evidence that this was the case. He launched court suit after court suit that were so absurd that they were dismissed by Democratic and Republican judges alike, including judges appointed by Trump.

Many assumed that once the Electoral College elected Joseph Biden and Kamala Harris to the U.S. presidency and vice presidency on Dec. 14, Trump would finally concede. Senate Republican leader Mitch McConnell and most elected Republican politicians went along with Trump until Dec. 14, hoping that once the Electoral College voted, Trump would finally accept reality and then business would proceed as usual. After Dec. 14, McConnell began to refer to Biden as the president-elect and Kamala Harris as the vice-president-elect while Trump still refused to concede. The split between Trump and McConnell, representing the executive and legislative branches of the government respectively, was now out in the open. With the certification of the electoral vote by Congress on Jan. 6 coming up, which had always been seen as a ceremonial rubber stamp hardly mentioned in the press, Trump’s last remotely legal option to stay in office was about to be exhausted. That left only an illegal option. This came down to a coup to seize dictatorial power in defiance of U.S. constitutional traditions that had survived even the War of the Slaveholders’ Rebellion, aka the Civil War. Trump decided to pursue the coup option. The only question remaining was how to do it.

In a meeting in the White House on Dec. 18, Trump considered a coup plan that would begin with the declaring of martial law in the “swing states” where the majority of voters had voted for electors pledged to Biden-Harris. The vote in these “swing states” would be declared invalid because of the alleged fraud. New elections would then be held, this time under conditions you can be sure would guarantee Trump’s victory. General Michael Flynn, the former head of the Defense Intelligence Agency and Trump’s original “national security” adviser, favored this course of action.

But this plan was so brazenly illegal and unconstitutional that ultimately Trump had to reject it as unworkable. However, Trump did not give up on a coup. The coup plan began with the gathering of some tens of thousands of supporters including the most extreme fascistic wing of his MAGA supporters from around the U.S. in the weeks preceding Jan. 6. (By fascistic, I mean Trump supporters who are willing to fight for him in the streets and use violence as opposed to Trump supporters who simply vote for him or attend mostly peaceful rallies.) These included former members of the military with extensive training in military operations and “off-duty” police officers. This was no mere accidental mob.

The next step was the announcement by several far-right Republican congressmen that they would exercise their constitutional right to raise objections to the legitimacy of pro-Biden electors from the swing states at the Jan. 6 congressional meeting. At first, this could be seen as simply political grandstanding on the part of some second-string Republican politicians playing up to the racist MAGA base. But then it was made known that Senator Josh Hawley and Senator Ted Cruz, in defiance of Senate Republican leader McConnell, would second the challenges to the elections of the electors in the “swing states.” This would then force both chambers of Congress to vote on the challenges. The idea was that if enough of these electoral votes in the Electoral College could be thrown out, Biden and Harris would fall below the 270 votes needed to win, thereby nullifying the Dec. 14 election of Biden-Harris by the Electoral College. The election would then move into the House of Representatives. There, according to the 12th Amendment ratified in 1804, each U.S. state has exactly one vote for president and vice president regardless of its population. It should be pointed out that this Amendment stands in complete contradiction to the principles of formal bourgeois democracy, which require one person one vote, not one state one vote.

Two centuries have now passed since the adoption of this anti-democratic amendment, which is more than enough time to replace it with a new one that would respect the principles of formal bourgeois democracy. For example, the new amendment could state that in the case where no presidential candidate receives a majority of the vote in the Electoral College, the election would be decided by the House of Representatives by a simple majority of all House members.

The wording of the 12th Amendment was no innocent mistake. Back in 1804, when the amendment was adopted, it was designed to give control of the presidency to the slave-owning states when no candidate had a majority in the Electoral College. On Jan. 6, 2021, the failure to replace the slaveholder-inspired undemocratic 12th Amendment was to bite back hard. The reason is that in the current Congress the Republicans control the majority of state delegations, though they have a minority of the total number of congresspeople. Therefore, if the 2020 election had been thrown into the House and assuming a party-line vote, Trump would have been “reelected” to a second term.

On the face of it, however, the challenges had no chance of success. This was true for two reasons. First, Mitch McConnell, who was no doubt privately glad to see Trump go, made it clear from Dec. 14 onward that he would vote to certify the Biden-Harris victory. McConnell as the Republican majority leader would have no problem bringing enough Republican senators with him to throw out any challenge. But there was a second reason.

Even if the Republican Senate had voted to throw out enough electoral votes to move the election into the House of Representatives, this still would have done Trump no good. The vote to certify the election is by majority vote of the House members and not one state one vote. The Democrats have a slim majority of congresspeople. Therefore, unless some Democrats decided to support Trump, which was simply not in the cards if only because the Democratic base hates Trump, the challenge would fail and Biden and Harris would still be sworn into office on Jan. 20.

But what would happen if the balance of power within the House was shifted on Jan. 6, if before the vote was taken on the challenges, a sufficient number of Democratic House members happened to die? Then, if enough Senate Republicans (the Republicans still had a slim majority at the time) or if deaths among Republican senators who were planning to certify the election occurred, the election would be thrown into the House after all, where Donald Trump would prevail. Was this the job of the fascists gathering in Washington, D.C., during the weeks leading up to Jan. 6 to ensure the necessary number of deaths among congresspeople and senators?

I am not saying that Donald Trump was deliberately trying to kill enough congresspeople and senators to achieve his aim of overturning the results of the 2020 election. Such an attempt would break many criminal laws including the laws against murdering people. Perhaps Trump was only trying to “pressure” congresspeople and senators to change their planned votes on the certification of the elections. Whether this was Trump’s conscious aim is a matter for the upcoming Senate impeachment trial and the criminal justice system to consider — though I wouldn’t hold my breath on that one — and for future historians to determine based on whatever additional information surfaces in the coming months and years. At the very least, Trump was playing with the lives of members of both the House and the Senate and his vice president, Mike Pence.

Before the Jan. 6 putsch was launched, Trump tried to convince Pence to announce when he “counted” the electoral votes on Jan. 6 that he (Trump) had won in the Electoral College vote rather than Biden and Harris, or at least that no candidate had won the necessary 270 votes, thereby throwing the election into the House. Pence explained that he (Pence) could only announce what the whole world had known since Dec. 14, which was that the Electoral College had elected Biden and Harris. When Pence explained to Trump that the Constitution gave him no legal leeway on his announcement of the results of the Electoral College vote, Trump was furious. Trump now considered Pence, who had played the role of a loyal lapdog for the last four years with the hope of emerging as Trump’s political heir and successor, as a traitor.

Pence’s refusal to go along with Trump on the formal counting of the electoral vote was part of a pattern that had persisted since the election was “called” by the AP on Nov. 7. Electoral Republican politicians who need the MAGA vote to win their future elections gave lip-service to Trump’s claims that there was widespread electoral fraud. But those Republican politicians and officials who had the power to throw out the elections of Biden-Harris electors declined to use it.

Whether they were state election officials, state governors, or legislators, federal judges or Supreme Court justices, or Justice Department officials, or even as it turned out the vice president of the United States, they were simply too deeply rooted in the U.S. constitutional system to go along with Trump’s brazenly illegal and unconstitutional demands. After the death of the liberal Supreme Court Justice Ruth Bader Ginsburg in September 2020, Trump insisted on having the then-Republican Senate confirm his nominee to succeed Ginsburg, right-winger Amy Coney Barrett, just weeks before the election. This even though it had long been an unofficial part of the U.S. Constitution that if a Supreme Court Justice dies as close to a presidential election as Ginsburg did, the president holds off nominating a successor until after the election.

But when the attorney general of Texas, himself under criminal indictment, filed a suit against several swing states that had certified Biden’s victory, Barrett along with the rest of the Supreme Court refused to hear the case. Again, from Trump’s point of view, he had once again been double-crossed by high Republican officials. In this case, he had been double-crossed by the three justices of the Supreme Court that he had appointed. What good was it to put so much effort to get Barrett on the court, Trump must have wondered, if she didn’t even use her vote to keep him in office! The putsch With all legal options for Trump to stay in office being exhausted on Jan. 6, the time for action had finally arrived. In addition to fascist allies such as the Proud Boys and others, Trump did have a few other powerful allies. One Trump ally was the police. The U.S. police force has long considered African Americans to be their primary enemies. Many U.S. cops, maybe a majority, will shoot an African American dead if they believe the person represents even the slightest personal danger to them. Indeed, they are trained to do so. Some cops go even further and shoot African Americans whenever they want to get rid of a particular person, whether for sport or some other reason. Police officers have gotten away with this time and again. Last year, after the police murder of African American George Floyd, the largest series of political demonstrations in U.S. history broke out across the USA and even spread around the world. The scope of this movement, and the sympathy for it shown by a surprising number of whites, especially younger whites, alarmed the U.S. ruling class. U.S. politicians were forced to make statements claiming some degree of sympathy for these demands, including the demand to “defund the police” and in a few case the more radical demand to “abolish the police.” The cops were furious.

We, they say to the capitalist ruling class and its politicians, do your dirty work, and we in return expect that you will back us up unconditionally when we go to war daily with our and your enemies. These enemies are above all African-American working-class people, who we as police officers wage war against daily throughout the streets and byways of America.

Trump, of course, denounced politicians who expressed any sympathy at all for the Black Lives Matter movement, whether sincere or not. This further increased the already enthusiastic support of an increasingly “radicalized” police force for Trump. Virtually every police “union” endorsed Trump for re-election.

Another source of support for Trump, though we don’t know how big it is, is the U.S. military officer caste centered in the Pentagon. The U.S. military is by far the largest and most powerful in the world. It has carried out many military coups against governments that U.S. imperialism desires to get rid of. But it has never carried out a coup in the United States itself.

But many an officer must wonder, wouldn’t a coup be a good idea right here at home? Then we and our police allies will settle accounts with the Black Lives Matter protesters, who are winning support among the rank-and-file soldiers, as well as left-wingers in general, trade unionists, and other enemies. General Suharto in Indonesia in 1965, General Pinochet in 1973, and the generals in Argentina in the 1970s knew how to handle the left. Why can’t we do the same thing right here in America? These officers in their own way agree with the great German socialist and Communist leader Karl Liebknecht that the main enemy is at home! General Mike Flynn is one example of such an officer. We can be sure there are many others.

The putsch began after Trump addressed a crowd of tens of thousands of MAGA supporters, which included many of the most fascist-minded ones, on Jan. 6 in front of the White House as Congress was meeting to certify the elections. Trump demanded that they march to the Capitol and said he would join them. But he didn’t. Instead, he retreated to the safety of the White House to watch the putsch unfold live on TV.

About 15,000 or so MAGA supporters, led by fascist-minded veterans, many of them armed, then marched to the Capitol. The leaders of the crowd that marched to the Capitol were led by men well trained in professional military tactics including on how to invade and seize control of buildings. These men led a crowd of about 800 people into the Capitol and dispersed Congress. Congresspeople, senators, and even vice president Mike Pence feared for their lives. The fascists erected a gallows in front of the Capitol, which they may have intended to use in an effort to change the composition of the House of Representatives from majority Democrat to majority Republican as well as to execute certain “disloyal” Republicans such as Vice President Mike Pence.

There is no doubt that police, military intelligence, and the FBI knew about the planned attack on Congress in advance. After all, it had been largely organized on-line through social media as well as through a cross-country bus tour organized by former Tea Party leaders under the name “Women for America First.” The 15,000 or so crowd of fascist MAGA supporters assembled at the Capitol, even though led by men well-armed and trained in military tactics, could easily have been contained and repelled. Congress could then have continued to safely go about its constitutionally mandated business of certifying the Biden-Harris victory. Indeed, the African-American mayor of Washington, D.C., had the day before called for National Guard forces to prevent the pending violence but was turned down. The result was that the police and National Guard left the Capitol, Congress, and Vice President Pence largely unprotected. Though the full story is still not known, it is obvious that the police and National Guard were deliberately held back so the Capitol invasion could proceed. This puts in a new light the recent firing of the secretary of defense and other Pentagon officials and their replacement by pro-Trump lackeys after it became clear that Biden-Harris had won the election. Indeed, the signs were so clear that Trump was planning a putsch to stay in office that all 10 living former secretaries of “defense,” including both Democrats and Republicans and such notorious war-makers as Richard Cheney and Donald Rumsfeld, in an extraordinary public letter published in the Washington Post Jan. 3 demanded the military allow the constitutionally mandated transfer of power from Trump to Biden proceed peacefully.

That statement was preceded by testimony to Congress by Gen. Mark Milley, chairman of the Joint Chiefs of Staff on Aug. 28. He wrote the following in response to several questions posed by two Democratic members of the House Armed Services Committee: “I believe deeply in the principle of an apolitical U.S. military. … In the event of a dispute over some aspect of the elections, by law U.S. courts and the U.S. Congress are required to resolve any disputes, not the U.S. military. I foresee no role for the U.S. armed forces in this process.” (

The putsch fails

Though the organized police and military units didn’t take decisive action for five hours to stop the putsch, they didn’t join it either. This doomed it to failure. The former war secretaries were reminding the top brass three days before the putsch that your masters, the big capitalists, do not want a coup. You must make sure that if one is attempted it is not successful and that Biden and Harris take office on January 20 just as the Constitution demands. The living war secretaries were reminding the brass that though it is true that power grows out of the barrel of a gun, it is the big capitalists’ money bags that finance the guns. Remember, these are the people you work for.

As pro-Trump fascists erected a scaffold and noose in front of the Capitol building, Trump did all he could to keep the National Guard from being mobilized to rescue the Capitol, Congress, and Vice President Pence. This allowed the fascists the time they needed to erect their scaffold and noose in front of the Capitol. For hours, the National Guard was nowhere to found.

Finally, Pence got in touch with the Pentagon, and the National Guard was sent to the Capitol. However sympathetic the top brass may have been to the putsch, they didn’t dare actively join it against the opposition of their paymasters the big capitalists. Trump was finally defeated and forced to order his mob to withdraw from the Capitol before the change in the composition of Congress could be achieved. A badly shaken Congress and Vice President Pence then reconvened and in the early hours of Jan. 7 certified the election of Joseph Biden as the 46th president of the United States and Kamala Harris as vice president. Still, a majority of the House Republicans and seven U.S. senators voted to in effect overturn the election. But this was not nearly enough to keep Trump in office. Thirteen days later, Biden and Harris, protected by 20,000 National Guard took their oaths and assumed office.

Why the capitalists opposed the Jan. 6 putsch

The capitalists need a strong, stable government. To achieve this, the government must be seen as legitimate by at least a large part of the population. Only in this way is the door to revolution kept securely shut. On Jan. 6 and the days leading up to it, the capitalists had essentially two governments to choose between.

One would have been an illegal unconstitutional government backed by the military and police headed by Donald Trump. While this government would have enjoyed the support of perhaps 30 or 35 percent of the population, it would have been opposed by the majority of the American people, including the majority of the working class.

On the plus side from the viewpoint of the capitalists, a Bonapartist dictatorship headed by Trump would have been able to carry out massive repression against the Black Lives Matters movement, the left in general, and the trade unions and all other progressives movements in a way no constitutional government ever could. Many people would have been killed — not just anti-Trump congresspeople and Mike Pence, you can be sure — or thrown into concentration camps and prisons. But at the same time, the long-closed door to revolution in the U.S. would have been opened.

The majority would have viewed a Trump Bonapartist dictatorship as illegal and illegitimate. The American people are taught that it is the supreme crime to overthrow a constitutional government elected by and for the people. However, they are also taught it is their duty to overthrow by any means necessary an illegal dictatorial government ruling in open defiance of the majority of the people as well as the letter of the Constitution. Indeed, whenever U.S. imperialism targets the government of a foreign country for regime change, it is always on the pretext of helping the people of the country in question to overthrow a dictatorial government and establish freedom and constitutional democracy.

As bad as a Donald Trump dictatorship would be, it would not have been a fascist government. The 15,000 fascist-minded MAGA supporters that Trump was able to moblize in front of the Capitol and 800 that actually invaded it are not nearly enough to establish a fascist dictatorship in a country as diverse and large as the United States. The U.S. population is now well above 300 million; 15,000 fascists are not nearly enough to hold them down.

Therefore, a Trump dictatorship would have had to rest on the military and police. The type of dictatorial government that seemingly exists above classes and rests on the military and the police is called in Marxist terminology a Bonapartist dictatorship. (3)

Also, while the police would have been pretty solidly aligned with Trump, the military would have been divided. The officer corp would have largely supported a Trump dictatorship if the top brass had gone that way, but many of the African-American and people of color workers in uniform, and even many working-class white soldiers, would in time have joined the inevitable revolution to overthrow the dictatorship and restore what would be viewed as constitutional democratic rule.

Before a genuine fascist dictatorship can come to power, a massive fascist militia movement must be organized. The militia must be centralized and disciplined around a dictatorial cult leader and organized as a political party that runs candidates in elections, publishes newspapers, and in today’s world has its own Internet-based on-line media. The disorganized fascist militia groups and other ultra-right organizations that exist in the U.S. today are in terms of numbers and organization nowhere close to what would be required to establish a true fascist dictatorship. To come to power, the emerging fascist party based largely on members of an impoverished middle class that fears falling into the ranks of the proletariat must organize a militia and wage civil war against the workers and other progressive organizations. The organized fascist militia must spread terror in the streets, the factories, and the university campuses, which inevitably results in the deaths of many people even before the fascists conquer power. Finally, the fascists through these tactics must achieve a position where the only strong capitalist government that is possible is a government formed by the fascist party itself. The backbone of a successful fascist party in the U.S. today would have to be based on a militia of millions ready to obey the demands of the Leader.

Italian and German fascism began as a series of disorganized militias such as the black-shirted ‘squadisi’ in Italy and the “Freikorps” militias in post-World War I Germany. At first, these militias lacked a strong central leader or an organized political party of their own. In 1918, when World War I ended with Germany’s defeat, nobody had ever heard of a certain NCO officer named Adolf Hitler.

But through a political struggle that unfolded over years, first Mussolini, who was a war veteran, journalist, and renegade socialist, and then Hitler, an unknown war veteran and in his peacetime life a would-be artist, emerged as leaders of the now unified fascist forces in their respective countries. In each country, before a strong fascist political party emerged, powerful upsurges of the workers’ movement opened up the real possibility that the workers could conquer political power. But in both Italy and Germany, the workers failed to take power.

In both Italy in 1922 and Germany in 1933, the capitalists had first hoped to lure the fascists into a conservative coalition government where they would be subordinate to the traditional conservative parties. That tactic didn’t work. The reason was that, in Italy and a decade later in Germany, the now centralized fascist militias had reached massive proportions and were able to engage in a reign of terror in the streets. The capitalists then realized that they couldn’t create a stable government that wasn’t backed by the fascists. The capitalist ruling class first attempted to lure Mussolini and later Hitler into coalition governments dominated by conservatives with Mussolini and Hitler in subordinate roles. But neither Mussolini nor Hitler would agree to those proposals. Instead, the fascist leaders demanded the top post, which was the prime minister position in Italy and the chancellorship in Germany. Realizing that a strong capitalist government could not be formed in any other way, the capitalists struck an agreement with Mussolini and then Hitler under which the fascist leaders would head the government but conservatives would form a majority of the cabinet.

Then because Mussolini and later Hitler had what the conservatives did not have, mass political parties with huge centralized militias loyal to Il Duce and the Fuhrer, they were able to push the conservatives aside and assume full dictatorial power. Once in power, however, due to the very nature of the capitalist economy, both Mussolini and Hitler were obliged to serve the class interests of the capitalists, which both fascist dictators were more than glad to do.

If they had managed to survive World War II, which fortunately they did not, both Hitler and Mussolini, who had started as people of modest means, would have died rich men. Capitalism was the goose that laid the golden egg for the fascists. Therefore, once in power the fascists were determined to preserve capitalism and advance the imperialist interests of their countries at any price. (4) When over the last four years I have said that Trump was not a fascist, I didn’t mean that he didn’t have a fascist ideology. Fascism has no ideology distinct from other reactionary pro-capitalist political currents. Mussolini was a life-long political chameleon. He was first a radical socialist and internationalist, then a pro-war “socialist” in the pay of France and Britain, and finally a chauvinistic anti-socialist Italian nationalist. He summed up his program as the “wish to govern Italy.” Not much ideology there, much like is the case with Donald Trump. Hitler was a life-long German nationalist chauvinist. After World War I, he was deep into the anti-Semitic conspiracy theory that held that “international Jewry” (5) controlled high finance, the Social Democratic Party, the Bolshevik Revolution, and the new German Communist Party. The Jews, according to this conspiracy theory, were determined to use all these instruments to destroy Germany as part of their alleged age-old campaign to gain world domination by breeding the white “Aryan race” out of existence by crossing it with the inferior “colored races.”

Though Hitler’s racist ideology was indeed horrible, it was common currency among the ruling classes and reactionary intelligentsia of Europe and America. Indeed, Winston Churchill held views on the Jewish question and the “lower colored races” similar to Hitler’s. Franklin D. Roosevelt also held similar views though political circumstances required the U.S. president to be discreet about it. Roosevelt was dependent on the vote of African-American and Jewish voters who were part of his political base.

The difference between Hitler and Churchill and Roosevelt was not so much in terms of ideology but rather that Hitler headed a massive centralized political party with a huge militia that waged civil war against the working-class organizations while Roosevelt and Churchill headed conservative capitalist political parties deeply rooted in their respective constitutional systems.

Far from the events of Jan. 6 showing that Trump was a fascist, they show that Trump had not organized a fascist political party. Trump had one foot in the extremely reactionary but by no means fascist Republican Party and the traditional constitutional system of the United States and one foot in a still very disorganized and relatively modest-sized fascist movement.

To have achieved a true fascist coup, Trump would have needed a mass centralized party with millions — not a mere tens of thousands — of militia people so powerful that he could tell the capitalist ruling class the only strong, stable government that could be organized was one headed by himself. Trump had nothing like that to offer the capitalists.

If the capitalists had chosen to go down the road that Trump did offer them, they would have had a government hated by the majority of the American people and, perhaps more importantly, viewed as totally illegal and illegitimate by this majority. This majority would have been determined after the previous 232 years of uninterrupted constitutional rule to restore what they have been taught their whole lives was the democratic constitutional rule of the people for the people.

If we look at the history of capitalist coups, they fail or backfire from the viewpoint of the capitalists when the working class and the people as a whole have already been defeated through previous struggles. Successful examples from the capitalist point of view were the coups in Brazil in 1964, Indonesia in 1965, Chile in 1973, and Argentina in the 1970s. Examples of coups that backfired are the 2002 coup against the Hugo Chavez government in Venezuela, and most recently the coup in Bolivia in 2019. But from the capitalists’ point of view, the most disastrous example was the Cuban coup of 1952. As the constitutionally mandated 1952 presidential election in Cuba approached, all indications pointed to a victory of the left-wing — but bourgeois and anti-communist — Orthodox Party. American imperialism at the height of the Cold War didn’t want to deal with a pesky, populist, and somewhat nationalist government in Cuba. The leaders of American imperialism organized in alliance with “the mob” that controlled the Cuban hotel and “gaming” industry, (6) a military coup that installed Fulgencio Batista as Cuban dictator. Back in 1940, when he was the democratically elected constitutional president of Cuba, Batista had issued a new constitution with many democratic features. This was the very constitution that Batista tore up in 1952. Batista proceeded to carry out many bloody repressions aimed at the opponents of American imperialism and of American organized crime in Havana as well as his personal enemies. The people of Cuba were outraged. A massive movement to restore what was seen as the democratic constitution of 1940 emerged to battle the Batista dictatorship on many fronts. In this movement, a certain young labor lawyer named Fidel Castro played a leading role.

Before the 1952 coup, a series of corrupt pro-imperialist but constitutionally elected governments ruled Cuba. There was constant political violence. But as long as constitutional rule was maintained and regular elections were held in which the various Cuban political parties participated, the door to revolution remained shut. During these years, Cuban politics was stuck in a vicious circle where one corrupt bourgeois party succeeded another. Then in 1952 to head off the victory of the populist Orthodox Party, U.S. imperialism and the mob encouraged Batista to return from the United States where the former Cuban president had been living and stage his coup. The Cuban people were outraged and a mass movement developed to restore the 1940 constitution and (bourgeois) democratic rule. The result was the victorious revolution of 1959. This revolution not only swept away Batista but also swept away the entire military and police system that had long underlay the “pseudo-republic” established by the U.S. invasion of the island during the Spanish-American war of 1898. Once unleashed, the revolution could not be contained within its original goals of re-establishing (bourgeois) democracy and the 1940 constitution but “got out of hand” and with support from the Soviet Union developed into a full-scale socialist revolution. The U.S. capitalists have no desire to find out whether a new American revolution to restore constitutional bourgeois-democratic rule that would have occurred in the wake of a Bonapartist Trump dictatorship would end in the same way the Cuban revolution had. That is why the U.S. capitalist class realized that under the circumstances the only real option open to them was the legal and constitutional election, within the very narrow limits of U.S. bourgeois democracy, of Joseph Biden as president and Kamala Harris as vice president.

The U.S. capitalist class has no love for genuine (bourgeois) democracy. But under the existing political circumstances created by 232 years of uninterrupted constitutional rule, combined with a rising anti-Trump movement crowned by the massive Black Lives Matter rebellion, followed by Trump’s defeat by 7 million popular votes in the Nov. 3 presidential election, the American people feel anything but defeated. Therefore, the only hope that the capitalists had for reestablishing a stable government after Trump’s chaotic four years in office was through a constitutional Biden-Harris government.

The second impeachment of Donald Trump

In the wake of the failed putsch, the Democrats with the support of about 10 anti-Trump Republicans moved to impeach Donald Trump a second time, the first time that a U.S. president has been impeached twice. At first glance, impeaching Trump would seem to make no sense. With all his options, both legal and illegal exhausted, Trump was scheduled to leave office on Jan. 20 and indeed he did. But the House of Representatives went ahead and impeached him anyway.

This means there will have to be a Senate trial of Trump, which is now set to begin later this month (February 2021). To convict Trump on the impeachment article of fomenting insurrection, the Senate, which serves as a jury, will have to vote by two-thirds to convict. While Trump’s first impeachment was a purely partisan affair with no chance of convicting Trump, this time it seemed at first that there was a real chance of conviction, which Senate Republican leader Mitch McConnell was rumored to favor.

But many Republican senators will face reelection in the coming years and still need the racist MAGA Trump base to win their reelection contests. Then there are Republican Senators such as Josh Hawley, Ted Cruz, and Lindsay Graham who have their own presidential ambitions and are eyeing runs in 2024. To prevail in the Republican primaries, they will also need the votes of Trump’s racist MAGA base.

Impeachment is not a criminal procedure. The most that can happen to an official, or in the case of Trump ex-official, convicted on an impeachment article is loss of pension and, in the case of an ex-president, taxpayer-paid Secret Service protection, plus if after a Senate conviction the majority votes to do so, the official’s right to hold another federal office. Therefore, if Trump is convicted in the upcoming Senate trial on an insurrection charge, he will likely be ineligible to run for president again in the 2024 election.

This is what McConnell wants and perhaps the majority of Republican senators as well, but they cannot say so for fear of losing their seats in future elections. McConnell reportedly wants to “purge” Trump from the Republican Party for good. However, while no reader of this blog would ever consider voting for Donald Trump, voting for him or any other presidential candidate is, after all, a formal democratic right under bourgeois democracy. The democratic right to run for president or another office on grounds of not supporting the current constitutional order that guarantees the class rule of the capitalist class cannot be suppressed without also weakening the right of other candidates who do not support the “current constitutional order” (such as, for example, communists) to run as well.

Under the present system of decaying monopoly capitalism — aka imperialism — Trumpism and other forms of Bonapartism can only be effectively fought by expanding democracy, not further contracting it. An even greater danger to the democratic rights of the opponents of U.S. capitalism and the working class is the threat that new laws will be passed against “sedition.” Though these new laws will be presented as being aimed against the Trumpist and fascist right, such legislation if passed will inevitably be used against movements like Black Lives Matter, the left, and the trade union movement.

On the other side, at Trump’s impeachment trial, possible criminal trials against Trump and other organizers of the Jan. 6 putsch that could follow, a lot about the operations of the military, intelligence agencies, and their secret police activities could be revealed, much like happened after the Watergate scandal that bought down Richard Nixon in 1974.

Indeed, Trump’s crimes against the U.S. constitutional order far exceed the crimes against that order committed by Richard Nixon. Of course, Nixon’s crimes against the people of Vietnam and other Indochinese countries is another matter, but those crimes were committed in the interests of imperialism and were therefore perfectly “legal and constitutional” from the viewpoint of U.S. law. However, the experience of not only the U.S. but other countries such as Germany under the Weimar Republic virtually rules out a thoroughgoing purge of those elements in the police and military who aided and abetted the Jan. 6 putsch. The ruling capitalist class very much needs the current police and military structure, notwithstanding their Bonapartist tendencies, in the inevitable coming class struggles with the working class and its allies both within the U.S. and around the world.

For his part, Trump is said to be considering launching a new political party to be called the “Patriot Party.” But there is reason to believe Trump is merely bluffing here. He is using the threat of launching a new far-right party to blackmail Republican senators to vote against convicting him in the Senate and thus leave open the possibility that he will mount a new presidential campaign for the Republican nomination in 2024.

So far, Trump’s plan appears to be succeeding. If a new far-right “Patriot Party” is launched with Trump’s endorsement, it will likely split off enough of the “plebeian” white racist MAGA voting base of the Republican Party to render Republican candidates unelectable. This could mean the downfall of the Republican Party, which would then weaken the Democratic Party as well since the Democrats are held together only by fear of the Republicans. If Trump does form a new far-right “Patriot Party” leading to the downfall of the Republican Party, it could lead to a genuine mass working-class party in the United States on one side and a genuinely fascist party on the other. (7)

Two perspectives

There are two political perspectives on the left as the post-Jan. 6, post-Trump era begins. One perspective appears in an article in the January 2021 issue of Monthly Review entitled “The Contagion of Capital,” signed by John Bellamy Foster, R. Jamil Jonna, and Brett Clarke. The article is largely about the economic situation but closes with a political perspective that, though written before the Jan. 6 events, reflects I believe the views of the majority of progressives, including the resurgent democratic socialist movement, the Communist Party USA, and many other left groups.

“Sweezy,” Foster, Jonna, and Clarke write, referring to the famed Marxist economist and Monthly Review founder Paul Sweezy, advocated “building a ‘cross-class alliance’ between those suffering most from monopoly capitalism and the more far-seeing elements of the ruling class, a kind of new New Deal, but with the working class as the organizing and hegemonic force. This was consistent with a political praxis emphasizing protecting the population in the immediate present while working toward the long-run revolutionary reconstitution of society at large.” The course recommended by the Monthly Review editors is the classic people’s front perspective. It proposes an alliance between a section of the capitalist class and the working class. Though the authors say that the working class should be “the organizing and hegemonic force” within the struggle for a “new New Deal,” in reality no section of the capitalist class will join such an alliance unless the continued existence of capitalism and indeed American imperialism is guaranteed in advance. This was indeed the case with the old New Deal and will be the case with any new New Deal or “Green New Deal” in the future.

The old New Deal meant the subordination of the industrial unions of the Congress of Industrial Organizations — the CIO — to the war drive of the Roosevelt administration, which aimed at nothing less than the establishment of a U.S. world empire. This was done, however, in the guise of a war against fascism and an alliance with the Soviet Union. This led to massive illusions not only about the democratic nature of U.S. imperialism but the prospects of long-term peaceful coexistence and cooperation with the Soviet Union after the war was won.

But even before World War II formally ended, the Cold War was launched by U.S. imperialism, in essence, a global class war that aimed at the destruction — ultimately achieved — of the Soviet Union. Any new or “green” New Deal under present conditions would aim at re-establishing the unchallenged hegemony of U.S. finance capital over the world market while crushing any force that stands in its way such as the newly industrialized People’s Republic of China.

The only way the people’s front perspective outlined by Foster, Jonna and Clarke makes sense is if you believe that even at this late date U.S. capitalism is still capable of progressive development. It seems that the Monthly Review editors believe this indeed to be the case. This is why they have lent support to Modern Monetary Theory, attacked the left economic writer Doug Henwood, who criticized Modern Monetary Theory, and sponsor the “Money on the Left” podcast. This is despite the fact that supporters of MMT do not attempt to hide the claim that their theory of money is directly counter to the theory of money — and value — developed by Karl Marx.

It is true we can’t prove an economic proposition such as, for example, that money must be a commodity, by simply referring to Marx’s view on it, just like we can’t prove that the modern theory of general relativity is true simply by referring to Einstein’s writings. In both cases, we have to understand the science ourselves.

This is why at the dawn of the Biden-Harris administration — and, as it turns out, in the wake of the events of Jan. 6 — I have decided to review a series of essays collected by the Marxist economist Fred Moseley. Moseley believes, in contradiction to Marx, that money does not have to be a commodity. I believe Moseley is wrong, but he has made a serious effort to prove his point.

If money does not have to be a commodity, the capitalist state’s ability to create a new expansion of the market is very different than if money does have to be one. This is why Modern Monetary Theory appeals to the Monthly Review editors despite its anti-Marxist nature. The supporters of MMT, though they are not Marxists and hold views incompatible with the views of Marx, are I believe serious and well-meaning people who believe that capitalism can be radically reformed and made to work for the majority of the people.

The Monthly Review editors are correct to want to make agreements with MMT supporters to fight for particular reforms but are incorrect wanting to form a general ideological block with them as well. The MR editors are following this course, I believe, because they share the belief with MMT supporters that there still exist considerable possibilities for reform within U.S. capitalism through a “Green New Deal” and that such reforms are urgent if modern civilization is to survive over the next few decades.

However, if Marx’s theory is correct that money must be a commodity, the possibilities of realizing reforms under capitalism, though not zero, are far fewer. Therefore, if Marx’s theory of value, money, price, and profit is right, the strategy of a cross-class alliance advocated by the Monthly Review editors will if realized bring nothing but disaster.

This doesn’t of course preclude united fronts with people like MMT supporters on concrete issues. These range from defending against racist-fascist attacks, opposing any new attempts at a Bonapartist coup, struggle for action against the current COVID pandemic, relief for the pandemic’s tens of millions of victims, and medical care as a right and not a commodity, and reforms that at least slow down the looming climate disaster and buy us even a little time, to the need to expand (bourgeois) democracy through reforms such as introducing ranked-choice voting that have the potential of breaking the two-party monopoly. And last but far from least, the struggle against current and new imperialist wars.

But the strategic perspective indicated by Marxist theory, and I believe actual historical experience, shows that no section of the U.S. capitalist class is capable of steering American capitalism back onto a course of progressive development. Therefore, the time has come to build in the U.S. an independent working-class party to win political power away from the capitalist class and transform American capitalism into socialism. If I am right about the impossibility of any future progressive development of American capitalism, the political strategy advocated by Foster, Jonna and Clarke can only end in the victory of Bonapartism and/or full-scale fascism, and finally, a new world war, which will be the grave of civilization.

If U.S. monopoly capitalism has indeed entered an era of decline, and I believe the evidence is overwhelming that it has, the events of Jan. 6 were not simply a chance event caused by the particularly vile personality of ex-president Trump but a reflection of increasingly sharp class contradictions that will sooner or later blow up the U.S. constitutional order. In that case, Jan. 6 was only a foretaste of what is to come. Now let’s return to the question of whether money in Marxist theory and even more importantly, in reality, must be an actual commodity.

Is the sum of all prices of reproduction equal to the sum of natural prices?

When we deal with prices of production, we should always assume a pure capitalist economy. There are only two classes in such an economy: the workers, who produce value and surplus value and sell their labor power to the industrial capitalists, who monopolize the means of production and who purchase the labor power of the workers. Also, Marx specifically abstracted the effects that different turnover periods have on the transformation of values into prices of production. A full explanation would have to take into account the different turnover periods of capital employed in different industries.

In such an economy, we still have two commodities that will not have prices of production. These will be the money commodity, which we will assume is gold bullion, and labor power. Labor power does not have a price of production because in our pure capitalist economy it is the only commodity that is not produced capitalistically. However, in this case, we can assume that the workers purchase their means of subsistence with the money that the industrial capitalists paid them for their labor power at their prices of production. Therefore, we can treat the price of labor power — money wages — as a market basket of commodities that sell at their prices of production. When we do this, we have only one commodity that does not have a price of production, the money commodity. Fred Moseley believes that while individual prices can diverge from direct prices (prices corresponding to values), the sum of all direct prices must always equal the sum of prices of production. But is this true?

Ricardo was aware of the problem of a divergence of the sum of all the “natural prices” of commodities and the sum of the direct prices of commodities if the ratio of capital to labor — in Marxist terminology, the organic composition of capital — is not average in the gold industry. Marx assumed that the gold industry has a below-average organic composition. (8) This was also the assumption of Sweezy in his 1942 work “The Theory of Capitalist Development.”

Assuming that this is true, gold will, through the competition-driven mechanism of the equalization of the rate of profit, exchange with most other commodities below its value. This means that the total sum of all commodities that have prices of production will exceed their direct prices. But Moseley as a supporter of MELT — the monetary equivalent of labor time, which denies that money has to be a commodity — refuses to accept this. True, Moseley admits that the prices of production of individual commodities deviate from their direct prices. But when the prices of production of all commodities are added up, Moseley believes they must always equal the sum of the direct prices of all commodities. “According to their (Bortkiewicz, Sweezy) interpretation,” Moseley writes, “in order to equalize the rate of profit in the gold industry, surplus-value is transferred from the gold industry to all other industries (with a higher composition of capital). This transfer of surplus-value from the gold industry to other industries is accomplished through an increase in the prices of these other commodities. Therefore, the total price of production of commodities is greater than the total value-price of commodities, because of this alleged transfer of surplus-value from the gold industry to other industries.”

“Surplus-value in the gold industry,” according to Moseley, “is a definite quantity of actual surplus gold produced, which has neither a value-price nor a price of production, and which therefore cannot be shared with other industries.” But why can’t the gold capitalists yield some of their surplus value to their fellow capitalists? “Surplus-value in the gold industry,” Moseley writes, “is a definite quantity of actual surplus gold produced, which has neither a value-price [Moseley means by value-price what Anwar Shaikh means by direct price — SW] nor a price of production, and which therefore cannot be shared with other industries. Therefore, there can be no change in the prices of production of other commodities as a result of this non-existent transfer of surplus-value in the gold industry.”

What Moseley does not understand is that the extra quantity of gold that the gold capitalists end up with after they complete their production cycle, though it contains the social substance — abstract human labor — that makes up surplus value, is not in its existence as a physical substance surplus value itself.

Moseley does point out quite correctly that the expression of capitalist production M-C…P…C’- M’ must be modified in the case of gold production, assuming that gold is the money commodity, to M-C…P…M’. This is because the C prime that represents commodities that have absorbed surplus value is in the gold industry, unlike any other commodity, also in its natural form money. There is no need for the gold capitalists to sell their commodity capital to turn it into money capital. But does this unique privilege mean that our gold capitalists do not have to hand over some of their surplus value to the other capitalists to reduce their profit to the average rate of profit? Not at all.

We know from Marx that the money price of a commodity is its value form. But what is the value form of gold — money — itself? It cannot be the money form of value since as Moseley correctly emphasizes, measuring gold in terms of itself is nonsense. But that does not mean that gold does not have a value form. The value form of gold is the expanded form of value. That is the form of value where we measure the value of a commodity of a given use value successively in terms of the use values of all other commodities except itself. In plain language, the value form of gold is the price list of all other commodities read backwards.

Now let’s return to the modified formula for capitalist production, which applies only to the industrial capitalists that produce the money commodity: M-C…P…M’. The gold capitalists like all other industrial capitalists begin with a sum of money M. There is no difference here between the gold capitalists and every other industrial capitalist. They must find on the market the necessary means of production and labor power to carry out the act of production. During this act of production their emerging product — gold bullion — like any other commodity in the making absorbs surplus value. However, since the capital used to produce gold bullion as a commodity has under our assumptions a below-average organic composition of capital, they must buy the commodities necessary to mine and refine gold bullion, not at their direct prices but their prices of production.

The fact that our gold capitalists’ commodity does not have a price does not mean that the prices of the commodities they must purchase to produce gold bullion do not have prices. These commodities most certainly do. And since our gold capitalists work with a capital of below-average organic composition, they must buy the commodities that make up their capital at prices, to use Moseley’s terminology, above their value-price, or direct price.

If we assume that prices are equal to direct prices, our industrial capitalists might need 10 kilos of gold to purchase the elements of the productive capital they need to produce 12 kilos of gold. But the fact that our gold capitalists are operating with capital of below-average organic composition will enable them to make a super-profit. But sorry, competition will not allow that.

This means that our gold capitalists will be forced to purchase the elements of their productive capital at prices above their direct prices. If they attempt to make these purchases with 10 kilos of gold, they will be out of luck and will not be able to produce 12 kilos of gold. To produce 12 kilos of gold, our golden capitalists will have to provide some additional gold, let’s say 11 kilos of gold. The gold capitalists will have to come up with 10 kilos plus an extra kilo of gold to carry out the next cycle of production.

The gold capitalists, therefore, had better not spend it on personal consumption. This extra kilo of gold contains the surplus value that the gold capitalists must hand over to their fellow capitalists to reduce our gold capitalists’ rate of profit to the average rate of profit.

Moseley as a supporter of MELT needs the sum total of all direct prices to equal the sum total of prices of production at all times. MELT can barely tolerate the deviation of individual prices from direct prices. If the sum total of prices of production and the sum total of direct prices are not identical, MELT is toast. Unfortunately for MELT, this is indeed the case. Moseley cannot deny that competition will not allow the gold capitalists to enjoy a higher rate of profit just because they work with capitals with a below-average organic composition of capital. In an attempt to escape the corner that MELT has driven him to, he resorts to differential rent to explain how the gold capitalists’ profit is lowered to the average. Moseley assumes that since the gold capitalists are enjoying an above-average rate of profit, they will open up some marginal mines, presumably on lower-grade gold-bearing land, and this will lower their rate of profit to the average. However, let’s assume that there is one grade of gold-bearing land. In that case, Moseley is stuck. Like all MELT supporters, Moseley doesn’t understand that while all commodities contain abstract human labor as a social substance and are therefore valuable objects, they are not for this reason all money. The belief that all commodities are money is the underlying assumption of the monetary equivalent of labor time — MELT — version of labor value. The abstract human labor including the abstract surplus labor contained in the money commodity is not only private labor carried out for our gold capitalists’ own accounts. The private labor that produces gold is, unlike the case with all non-money commodities, at the same time directly social labor.

This means that the private labor embodied in gold does not need to be exchanged with another commodity to show that it is a part of the total social labor. This is the unique privilege of the gold capitalist compared to all other industrial capitalists. However, the gold capitalists are not privileged when it comes to the need to yield some of the surplus value — assuming they work with capitals with a below-average organic composition — that their golden product has absorbed during its production processes.

As a result, the surplus of gold that our gold capitalists possess after they have completed the process of production, relative to the gold they started with, not only contains surplus value. In that respect, the gold capitalists are in the same position as all other capitalists. It — and this the most important privilege that the gold capitalists have over all other industrial capitalists — is at the same time already profit in its (gold’s) natural form without having to be sold.

Why money must be a commodity

MELT implies that the abstract human labor embodied in all commodities means that commodities are equally all money. In MELT terminology, the abstract human labor embodied in all commodities is the monetary equivalent of labor time. Therefore, there is no special monetary function for gold. Why then can’t the monetary authority issue pieces of paper with X amounts of dollars printed on them backed by the monetary equivalent of labor time embodied in the commodities that the pieces of paper circulate? MELT implies that the dollars will then automatically represent the proper monetary equivalent of labor time needed to circulate the commodities.

MELT if carried to its logical conclusion leads to Say’s law — the impossibility of a general overproduction of commodities. Since all commodities are money — which was the basic assumption of Say as well — how can commodities be overproduced relative to themselves. Say conceded only that some commodities can be overproduced relative to other commodities.

If, however, one commodity serves as money, which was Marx’s view, all commodities can be overproduced relative to the money commodity. But if all commodities are equally money, so that no single commodity is money, then Say was right when he argued that a general overproduction of commodities relative to the money commodity is impossible. Therefore, MELT theorists rarely if ever refer to general overproduction. Crises might be seen as representing the over accumulation of capital — though relative to what is often left unexplained — but never the general relative overproduction of commodities. Also, MELT implies the quantity theory of money, since whatever the nominal amount of money in circulation, whether denominated in dollars, yen, rubles, yuan, or euros, the nominal quantity of money will adapt itself through the price mechanism to the quantity necessary to circulate the commodities. Therefore, according to MELT, we don’t need a dazzling piece of gold to act as a counter-value for all other commodities. Any ugly worn piece of green paper issued by a Federal Reserve Bank with “Federal Reserve Note” and X amount of dollars printed on it, as well as the statement that this note is legal tender for all public and private debts, will do.

Marx did not use the terms direct price and value-price. Instead, he referred to commodities selling at their values. But this is a kind of shorthand whose meaning has been largely lost by post-Marx Marxists. Let’s break this shorthand down.

If a commodity sells at its value, it means that the value of the commodity equals the value of its price. Remember, price is a definite quantity of gold bullion measured by some unit of weight. Therefore, if we say commodity A sells at its value, we mean that X quantity of commodity A will embody the same quantity of abstract human labor as the weight of gold that represents its price. If the price of commodity A is higher than its value, it means that commodity A embodies less abstract human labor than the weight of gold that constitutes its price. If the price of the commodity is below its value, it means that commodity A embodies more abstract human labor than the weight of gold that represents its price.

In Marx’s version of labor value in contrast to the MELT version, it is therefore quite possible not only for individual commodity prices to stand above or below their values but for commodity prices as a whole to stand above or below their values. MELT, therefore, is powerless to solve the transformation problem correctly. It is also powerless to explain the fluctuations of prices defined in terms of gold during the industrial cycle where the general price level starts below the value of commodities during the crisis and depression and then rises above the value of commodities during the phase of the economic boom that precedes the next crisis.

Why MELT fails

While according to MELT it is possible for the prices of individual commodities to diverge from their values, the total sum of all prices must always equal the total sum of all direct prices. This works well enough if capitalists are guaranteed that they will be able to exchange their particular commodities with any other commodity at its value. In this case, all commodities would indeed be money and no particular commodity would be money. But do our capitalists know how to produce commodities in the proportions necessary so that they are guaranteed to realize their values in terms of the use value of other commodities in the first place?

Moseley as a MELT supporter hasn’t reasoned this out. If he had, he would be obliged to abandon MELT. But he does know that an ugly trap is awaiting him in the form of the transformation problem. In Volume III of “Capital,” Marx shifts his assumption from assuming commodities sell at their values — that is, at their direct prices. In other words, faced with the reality of different organic compositions of capitals in different industries, as well as different turnover times of capitals in different industries, if we are to assume an equal rate of profit we have to assume that prices do not equal values, aka direct prices and value-prices.

To be continued.


1 Because of his advanced age — he is now 78 and will be 82 when he completes his term on Jan. 20, 2025 — Biden is expected to serve only one term. Kamala Harris is widely expected to be the Democratic presidential candidate to succeed Biden in the 2024 presidential election. If Harris becomes president, she will be the first woman as well as the first woman of color to become U.S. president. (back)

2 Journalists who write for the capitalist press have great difficulty in understanding that working-class people who own little if any corporate stock do not care as much about the level of stock market prices as they do. Workers instead are much more concerned about the number of jobs, the level of wages, and working conditions. (back)

3 I say seemingly above classes because, in the final analysis, even a Bonapartist government depends on the capitalist class to pay the bills and is therefore obliged to serve the interests of the capitalists. (back)

4 After World War I, France occupied the Ruhr Valley in Germany. The French used some troops from its African and Indochinese colonies. Racist-minded Germans were outraged that they were put under the authority of African and Indochinese troops, who they considered to be of a lower race. German politicians ranging from the Social Democratic President Friedrich Ebert and other Social Democratic leaders on the left to the far right protested against France’s use of “colored” troops to occupy the Ruhr. How dare the French, they complained, put members of the inferior races of Africa and Asia in authority over white Aryan European Germans! The racist attitudes in Germany did not prevent some women from marrying or otherwise having babies with some of these nonwhite soldiers occupying the Ruhr. The far right and the rising Nazi party demanded that these children be sterilized to prevent the further “debasement” of the German white Aryan race. They charged that “international Jewry” was behind this move to debase the white race to remove the obstacle that the superior white Aryan race represented to Jewish global domination.

When the Nazis came to power in the 1930s, these mixed-race people were without their knowledge forcibly sterilized to prevent further debasement of the white Aryan race. Today’s fascists claim that the white race is being bred out of existence by the growing number of non-white people living in the United States and Europe. Again, the far right claims that the Jews are behind what the far right sees as an increasingly successful attempt to destroy the white Aryan race through interbreeding with the “lower” colored races. (back) 5 In the 1930s, an Italian renegade Communist Bruno Rizzi advanced the claim that Hitler and Mussolini represented a new class of bureaucrats who were expropriating the capitalist class and thus paving the way for socialism. Rizzi pointed to Hitler’s “Aryanization” campaign, which forced Jewish businessmen to sell their businesses to “Aryan” capitalists at cut-rate prices, as a progressive step toward expropriation of the entire capitalist class by the state. Rizzi claimed that Stalin, along with Hitler and Mussolini, represented what he called “bureaucratic collectivism,” which though not socialism itself was a progressive step toward socialism.

James Burnham, in the late 1930s a leader of the Trotskyist Socialist Workers Party, took up Rizzi’s theories but drew different conclusions. Burnham claimed that the Soviet Union under Stalin, Nazi Germany, and fascist Italy were examples of countries ruled by a new class of totalitarian managers that were replacing the capitalist class as the ruling class. He saw the U.S. under the New Deal though still capitalist as heading down the same path pioneered by Stalin, Hitler, and Mussolini. After he broke with the Trotskyist movement in 1940, Burnham wrote a book, “The Managerial Revolution,” that popularized these ideas. Burnham was the chief influence behind George Orwell’s famous novel “1984.” His ideas also influenced the liberal — in the New Deal, not neo-liberal sense — John Kenneth Galbraith’s 1967 book “The New Industrial State.” This book echoed Burnham’s claim that managers were taking the big corporations away from the capitalists.

However, while Burnham drew conservative-reactionary conclusions from his “Managerial Revolution,” Galbraith believed that the same “revolution” was a positive step toward a socialist society that would be an advance beyond capitalism. Burnham, in contrast, came to see the capitalists as waging a last-ditch attempt to defend “freedom” from an encroaching totalitarian bureaucracy represented by the Communists, fascists, as well as the New Deal. As a result of these views, Burnham became a right-wing Republican and a columnist for William F. Buckley’s National Review. Shortly before he died, Burnham was rewarded with the Presidential Medal of Freedom by Ronald Reagan. Galbraith, in contrast, took a benign view of the “managerial revolution.” He saw it as a natural, peaceful and gradual evolution from capitalism toward socialism. Burnham’s influence is also visible, though to a lesser extent, in Sweezy and Baran’s “Monopoly Capital.” In this book, Sweezy and Baran claimed that the managers of large corporations had largely freed themselves from (and the influence of) the bankers and the financiers, though unlike Burnham or Galbraith, Sweezy and Baran stressed that the managers themselves were capitalists. For Sweezy, monopoly capitalism was not evolving peacefully into socialism as in Galbraith or descending into a managerial totalitarian nightmare as in Burnham but was simply stuck as manager-dominated monopoly capitalism no longer dominated by financiers and banks By the late 1960s Sweezy had largely abandoned his support of the Soviet Union claiming that the USSR was dominated by a new bureaucratic ruling class. Later, in the 1980s, he expressed regrets about the negative attitudes he had adopted toward the USSR and its Eastern European allies during the 1960s.

In the real world, neither the fascists, the New Deal, or corporate bureaucracy pushed aside the capitalists as Burnham feared they would and Galbraith hoped they would. Rather, it was the leaders of the Soviet bureaucracy under Gorbachev and Yeltsin that reestablished markets, private property, and capitalism. In the 1950s, 1960s, 1970s and the first half of the 1980s, there were repeated attempts by Soviet and Eastern European “reformers” to graft the “profit motive” onto the planned economies of the USSR and even more so the Eastern European countries. Finally, under the new General Secretary of the Soviet Communist Party Mikhail Gorbachev and his successor Russian President Boris Yeltsin, the planning principle was abandoned completely and replaced by profit as the only guiding force of the economy. This led to the rapid reestablishment of capitalist private property, at the cost of the impoverishment of most of the population and the dramatic lowering of the productive forces.

In the meantime, a series of economic and financial crises combined with post-Volcker shock “financialization” had again shown that in any crisis it is the people with money that call the shots. This has become so obvious that today John Bellamy Foster, Sweezy’s successor as leader of the Monthly Review school, refers to the domination of what he calls “monopoly-finance capital,” and the alleged domination of the corporate managers is now forgotten. Therefore, not a brick is left standing of the once trendy theories of Rizzi, Burnham and Galbraith. (back)

6 Interestingly enough, Trump as a capitalist has specialized in investing in the hotel and “gaming” (aka gambling) industries that were historically dominated by organized crime. (back)

7 Trump will be 78 in 2024. So it is by no means impossible that if the Republican Party indeed splits and the “Patriot Party” is launched, it won’t be Trump but a much younger person who will emerge as its leader. In that case, depending on the evolution of the economic situation and the course of the class struggle, the “Patriot Party” might then develop into a truly fascist party. (back)

8 According to the Internet site, the present-day modern gold industry is extremely capital intensive. Modern gold mining and refining is based on mining ores that contain minute amounts of gold and extracting the gold from them. This implies that modern gold mining and refining is no longer a below-average organic composition industry but perhaps has an above-average organic composition of capital. If this is indeed true, the sum total of prices of production will be less than the sum total of direct prices. Instead of having to yield some of its surplus value, the modern gold capitalists instead obtain some extra surplus value by buying the means of production necessary to produce gold at prices below their direct prices. But this doesn’t change the basic argument that the sum total of direct prices will almost surely differ from the sum total of prices of production. (back)