reviewed by Ken Tarbuck Ed.note: This recently published book has, up to now, attracted little notice in the review columns of the capitalist press, and almost no discussion in the socialist press. The Week can claim with some justification that it recognised the importance of this book by organising the first public discussion on it in london on June 24th this year. We return to the subject because we feel that some of the issues raised in the book are of importance to all serious socialists. This book is a revisionist work in the very best tradition of that very overworked phrase. It sets out, boldly, to examine the present stage of monopoly capitalism and in the process tries to arrive at an adequate theory of its laws. In doing so the authors felt that they had to revise certain of Marx's concepts, or, rather, to question tle validity of their application today. But this they attempt to do on the basis of general Marxist theory and not by contradicting or opposing Marxism. It is perhaps this aspect of the book that gives it sone of its novel and most interesting aspects. The crux of the problem is that they see the analysis that Marx gave as being based upon a competitive model of capitalism and that monopoly is only seen in this context as being marginal to the analysis. They argue that previous attempts by Marxists to analyse monoploy have failed because they were rooted in the competitive model, and not because of their assumption that monopoly is today the dominant feature of capitalism and that new assumptions and new analytical tools are therefore required, The main revision that they undertake is that of dropping the concept of surplus value and substituting for it the concept of ‘economic surplus', which they define as "the difference between what a socicty produgss and the cost of producing it". This may appear to be merely a play on words, and a relatively simple concept. However, it is far more than this, and the actual computatiion of the economic surplus is today a highly complex and exacting task. Why they undertook this revision was because ".... in a highly developed monopoly capitalist society, the surplus assumes many forms and disguises, .... It is for that reason we prefer the concept ‘surplus' to the traditional Marxian ‘surplus value', since the latter is probably identified in the mind of most people familiar with Marxian economic theory as being equal to the sum of profits + interest + rent. .,.. It is our contention that under monopoly capitalism this procedure is no longer justified, and we hope that a change in terminology will help to effect the needed shift in the theoretical position". (page 6) This shift in tS2oretical position is probably the one that will give rise to the greatest controversy around this book. The usefulness or other wise of the introduction of this new concept will, in my opinion, depend on how one uses it. If, as I think they do, Baran and Sweezy use the theory to suggest that crises will tend to disappear or become merely residual under monopoly capitalism, this could lead to serious errors of juigement. Ir, however, one uses the concept to demonstrate the fundamental irrationality of the system, then it becomes an additional powerful weapon of analysis. The book puts forward the idea of a rising economic surplus as being the distinguishing characteristic of the monopoly era of capitalism: this is brought forward in distinction to the law of tendency of the decline in the rate of profit that has a central place in traditional
Marxian economics, T i i the major problem for lee a ee pnts rising mann Se ie Beth, owen. ash =o wae to their theory, One ively new problem for capitalism but a anenntenss dhe ilaetiremean denied that capitalisn has been a tremendous eae <i scans
é material go rats sere would do other than prepare the material basis for the conta
ocilalism on a world scale. In fact they have maintained that this was biota wrerqres decades ago. Moreover, the figures that Baran and Sweezy prouce tend to reinforce the law of tendency to a decline in the rate of profit. They calculate that the economic surplus as defined by them rose 4s a percentage of Gross National Product, in the U.S., from 46.9 in 1929 to 56.1 in 1963. Surplus value, i.e. profit, rent and interest declined from 57.5 to 31.9. Therefore, one would question the necessity for the sharp counterposing between what Baran and Sweezy call the old Marxian concepts and what they bring forward as new Marxian concepts, This is not to deny the very valuable contribution to our understanding that they have made. The data they produce, to verify their concept of the economic surplus, is most illuminating, both in relation to the U.S. economy specifically and, by implication, to monoploy capitalism in general, The actual analysis, rich and complex both in its more narrowly economic data and of the social relation/ conditions, is of such an order that it does not need the counterpointing that is introduced. There are, hower, a number of other defects that prevent it from being a rounded out analysis of the monopoly stage of capitalism, in the way that Marx gave one of the competitive stage of capitslism. The changes in all the advanced capitalist countries since the end of World War IT have been characterised by a number of European Marxists as ushering in the period of neo-capitalism and neo-imperialism, These take into account a number of factors that in my opinion this book does not, or underplays them to a considerable extent, e.g. the changed nature of the trade cycle. The defects in "Monoploy Capital" stem partially from the analysis resting primarily on the American experience, (which the authors freely admit) and particularly the home scene. The forays into overseas questions, e.g. imperialist aggression, seem at times to be solely for the consumption of tke economic surplus: in fact they argue that foreign investment is an unimportant element. This, to say the least, makes it a very odd explanation for imperialisn. Moreover, I think there is a danger that conclusions of too general a nature are drawn about the nature of monopoly capitalism than are warranted by the material. Some of these defects stem, I think, from a lack of totality of view, and a failure to comect the still very important link between the export of capital and the pattern of imperialist aggression, On the question of the pricing system of monopoly capitalism, the book advances no new ideas. The essential ideas of pricing under conditions of oligopoly, known as the kinked demand curve, are well known and orthodox - not that one necessarily disagrees with their conclusion, rather it is a little disappointing. One factor that I feel is insufficiently stressed is that under conditions of monopoly/oligopoly there is greater scope for exploitation of the workers, not only as producers but also as consumers, and that the greater the degree of monopoly the greater the chance for this. Nevertheless, this is an exciting book. For all its defects it is a book by political economists, and Marxian-socialist ones to boot. It should not only have a place on our bookshelves, but also a place in our discussions for a long time to come.