PRAGOTI

[This is the text of the Safdar Hashmi Memorial Lecture delivered by eminent Marxist economist Prof. Prabhat Patnaik, on 8th November 2008 in New Delhi. In this lecture Prof. Patnaik argues that Marxist theory should not be viewed as a closed isolationist knowledge system. On the contrary, It is important for Marxist theory, especially today, to break out of isolationism, to engage vigorously with the world of ideas in general, and thereby to enrich itself to cope with the unfolding reality of the world capitalist crisis. -Ed.]

Lenin’s Imperialism the Highest Stage of Capitalism is undoubtedly among the most important books on political economy to have been written in the twentieth century. It provided the basic theoretical framework that underlay both the revolutionary slogan during the first world war of “turning the imperialist war into a civil war” and the subsequent formation of the Communist International. And yet, paradoxically, when one reads this Marxist classic, one finds very few specific references to Marx’s writings. It does take off from the basic Marxist idea of “centralization of capital”; but beyond that it relies on other sources, such as Hilferding, and, above all, Hobson, who was an English parson by profession and a liberal pacifist in his views. The fact that Lenin relies heavily on the work of an English parson does not make his work any less Marxist; on the contrary what he takes from Hobson and weaves into his own framework constitutes a development of Marxism.

Lenin did this quite systematically. His speech to the Second Congress of the Communist International borrowed heavily from John Maynard Keynes’ The Economic Consequences of the Peace. Even as he called Keynes “a well-known bourgeois and implacable enemy of Bolshevism”, “the British philistine”, and “petty bourgeois pacifist”, he arrived in the course of his speech at the following conclusion: “If on the one hand, the economic position of the masses has become intolerable, and on the other hand the disintegration described by Keynes has set in and is growing among the negligible minority of all-powerful victor countries, then we are in the presence of the maturing of the two conditions for the word revolution.” He was clearly not quoting Keynes to make a debating point, but was relying on Keynes’ work to come to the conclusions he did.

Three propositions follow from this which are of importance to Marxists. First, important elements of “truth” may be found even in the writings of “philistines” and “petty bourgeois pacifists” who have nothing to do with Marxism; secondly, Marxists can fruitfully use these elements in their own theoretical constructions, to develop their own theory. And thirdly, for doing so, Marxism has to be “open-ended” in the dual sense, of being open to new ideas, even those propagated by “philistines” and “liberal pacifists”, and of appropriating them for its own use in its own fashion.

Marxism in other words while having its own distinct character does not remain aloof from the realm of ideas peopled by non-Marxists, but is part of the general world of ideas. Indeed one can go further. The development of Marxism occurs precisely because it is part of this general realm of ideas. Its specificity, and its superiority, in the sense I shall describe below, arise however from the fact that it comes to this general realm of ideas with its own basic concepts and understanding. If it cut itself off from this general realm of ideas then it would stagnate; likewise if it merely got submerged in this general realm of ideas, abandoning its own basic concepts and approach and became either eclectic or hegemonized by strands of non-Marxist ideas, then it would lose its edge.

In fact there is a more basic point here. I have referred to stagnation
and submergence as two distinct alternative possibilities. This is actually incorrect. Stagnation is implicit submergence. The lack of serious theoretical engagement with the realm of ideas, often camouflaged by debunking all ideas other than what the classic Marxist “texts” say as bourgeois or counter-revolutionary, produces not only stagnation in the name of “purity” but a subterranean hegemonization by the very bourgeois ideas so debunked. This fact may not be immediately apparent; it may become apparent only over time. But it is inevitable. The late Soviet-era text-books on economics for instance were so “pure” that they reproduced, while discussing Marx’s Reproduction Schemes, the very same numerical examples that Marx had produced in Capital. This “purity” obviously meant intellectual timidity and stagnation and hence an implicit intellectual hegemonization by the bourgeois ideology which only became apparent when Gorbachov as General Secretary of the CPSU rued the fact that the Soviet Union had remained cut off for long from “the mainstream of European civilization”!

II

The proposition that specific scientific discoveries may be made within diverse ideological traditions was made by Joan Robinson in an article “Marx, Marshall, and Keynes”. The classic example of this is the theory of effective demand. This was advanced within the Anglo-Saxon world in 1936, in the midst of the Great Depression, to explain the phenomenon of the Depression itself, by John Maynard Keynes who was an English Liberal. The same basic idea was advanced in 1933 by Michael Kalecki, a Polish Marxist who was an engineer by training and who taught himself economics by reading Marx and Rosa Luxemburg.

But while the scientific discovery of the theory of effective demand was made within two vastly divergent intellectual milieus and traditions, which suggests that no one particular tradition has a monopoly in making such scientific discoveries, the scientific discovery itself came, within each tradition, with the soil of that tradition, as it were, clinging to it. For instance, several of the building blocks of Keynes’ theory consisted of supposedly psychological attributes of human beings (such as the “propensity to consume”), while those particular building blocks in Kalecki are rooted in property relations and the resultant income distribution.

When Marxist theory, in its engagement with the general realm of ideas, makes use of the scientific discovery of some tradition other than itself, it has to do so therefore with three caveats: first, it must remove the soil of the other tradition which comes clinging to the theory; second, it has to use the theory as a building block for its own larger edifice, so that it cannot incorporate the theory in a simpliste fashion, or in toto; and thirdly, its own theoretical edifice must always be built for praxis unfettered by the bourgeois bounds of society.

Let me take up each of these points. The first is pretty straightforward. The psychological props upon which Keynes bases his theory for instance have to be replaced, when his theory is being incorporated into a Marxist structure, by other building materials which serve the same analytical purpose but which are part of the Marxist tradition. The second relates to the fact that the totality of Keynesian theory can never be incorporated into a Marxist structure. For instance the Marxist postulate that capitalism can never do without a reserve army of labour suggests that while the Keynesian theory of effective demand may be appropriated by Marxist theory, the Keynesian view that capitalism can reach full employment through the boosting of effective demand by the State cannot possibly be so appropriated..

The third point is of some importance. The fact that Marxists talk of revolutions is often used as a criticism of their position, viz. they have nothing to offer “on this side of the revolution”. This too however is incorrect as Lenin argued in putting forward the concept of “transitional demands”. In fact one can think of two kinds of “transitional demands”, those which within a given conjuncture stretch capitalism to the point where it cannot meet the demands (such as the demand for “land, peace and bread” during the Bolshevik Revolution); and those which can be met within the system in a given conjuncture, but whose meeting creates fresh contradictions that set the stage for a new set of demands to resolve them, and so on, in a recursive manner until the system is stretched to its limit.

It follows that Marxist theory, though of course concerned with the revolution, is not concerned solely with the revolution, in the sense of remaining dormant until the time for the revolution comes, when it suddenly wakes up. Rather, it is engaged in “praxis” around “demands” every moment, but is distinguished from all other tendencies engaged in such praxis by the fact that it alone can go beyond capitalism through such praxis. It can be consistently scientific precisely because it alone is not circumscribed by the boundaries of capitalism, it alone can “go the whole way”, it alone does not at some point compromise its honest scientific understanding to remain on “this side of the boundary of capitalism”.

III

It may well be asked: why should the fact that Marxist theory “can go the whole way”, i.e. can look beyond capitalism, give it an edge over all other traditions when it comes to scientific understanding? Marx himself was critical of classical political economy, i.e. saw it as a scientific limitation of classical political economy, that it believed that history had come to an end with the bourgeois system. But how can Marx’s critique of classical political economy on this score be justified?

One can give a general justification. This is in terms of the fact that the possibility of standing epistemologically outside capitalism gives us a deeper understanding of capitalism itself. Paul Baran had once argued that just as we do not get a scientific understanding of the slave society by applying to it the reasoning that is prevalent within a slave society itself, likewise we cannot get an understanding of the capitalist society by applying to it its own reasoning. True, it can carry us up to a point but no further. To understand capitalism fully we need to stand epistemologically outside the capitalist society itself, and we can do so only if we can perceive a society beyond capitalism, which Marxism alone does.

There is however an even more compelling and specific justification, and this consists in the fact that capitalism is what Oskar Lange had called a “spontaneous system”, i.e. it moves according to its own immanent tendencies, and is not a malleable system which can be moulded according to will, through, for instance, the intervention of the State. The fact that post-war capitalism had gone in for large-scale State intervention may appear to contradict this. But such intervention, far from being the rule under capitalism, was in fact an exception which resulted from the specific and extraordinary conjuncture of the war, and the changed correlation of class forces in the aftermath of the war, where the working class emerged immensely stronger than before owing to its wartime sacrifices. Not surprisingly, however, the immanent tendencies of capitalism asserted themselves after the lapse of some years and this ended the era of Keynesian demand management: for instance, centralization of capital gave rise to the globalization of finance (and the formation on this basis of a new form of international finance capital) in the face of which the nation-State (other than the U.S. perhaps) was incapable of pursuing autonomous policies. The nation-State in other words had perforce to bow to the caprices of international finance capital, pursue policies to its liking, and hence lose the autonomy required for carrying out Keynesian demand management. Capitalism was back to its “spontaneity” after a couple of decades of “social engineering” through State intervention, which incidentally explains why we are back to facing crises reminiscent of the 1930s.

The spontaneity of the system implies that those contradictions of the system which are reproduced by its immanent tendencies can be resolved only when these tendencies themselves are overcome, i.e. only when the system itself is transcended. All theoretical positions other than the Marxist one which believe that the contradictions can be resolved within the system itself are therefore necessarily partial. Even when some of these positions, like the Keynesian one, are based on important scientific discoveries, these discoveries are embedded within an overall perspective that is limited, partial, and hence in a fundamental sense unscientific. The Marxist position, precisely because it has an overall perspective that is scientific, since it correctly cognizes the spontaneity of the system, can preserve its scientific character even while borrowing specific scientific discoveries from other traditions; but the other traditions, even when they make scientific discoveries, have a totality that is fundamentally unscientific since it necessarily presumes the possibility of successful and permanent, social engineering, overriding the immanent tendencies of the system.

It follows than that the proposition that scientific advances are possible within all theoretical traditions, including “philistine” and “social pacifist” ones, does not negate the view that Marxism is scientific in a basic sense in which other traditions are not. This is because Marxism correctly perceives the system as being subject to immanent tendencies and hence spontaneous. This spontaneity is a reality about capitalism discovered by Marx, not just an attribute ascribed to it by Marx. It is this grand discovery that constitutes the basic case for socialism which is the scientific achievement of Marx.

Our difference from Joan Robinson’s position outlined above should now become clear. Joan Robinson made a distinction between science and ideology and saw each tradition in a symmetric fashion as an admixture of science and ideology. The argument presented earlier states that even though scientific discoveries can be made within any tradition, there are different levels of scientific discoveries. Marx’s discovery of the spontaneity of the capitalist system which in turn is located within his discovery of historical materialism, makes Marxist theory stand apart from this symmetry. Even when it borrows scientific elements from other traditions it has a scientific worth that exceeds others.

IV

The idea that the development of Marxist theory is marked by a process of assimilation, absorption, appropriation, and hence transcendence (or “going beyond”) of all advances of knowledge, no matter what ideological integuments such advances come wrapped within, is in conformity with the philosophical position of dialectical materialism. This position was expressed by Lenin in his note “On the Question of Dialectics”, a piece that is strongly influenced by Hegel to whom Lenin came somewhat late in life. Lenin says: “Philosophical idealism is only nonsense from the standpoint of crude, simple, metaphysical materialism. From the standpoint of dialectical materialism, on the other hand, philosophical idealism is a one-sided, exaggerated.. development (inflation, distension) of one of the features, aspects, facets of knowledge, into an absolute, divorced from matter, from nature, apotheosized. Idealism is clerical obscurantism. True. But philosophical idealism is (“more correctly” and “in addition”) a road to clerical obscurantism through one of the shades of the infinitely complex knowledge (dialectical) of man”.

Lenin further elaborates on this idea in the following words: “Human knowledge is not (or does not follow) a straight-line, but a curve, which endlessly approximates a series of circles, a spiral. Any fragment, segment, section of this curve can be transformed (transformed one-sidedly) into an independent, complete straight-line, which then leads into the quagmire, into clerical obscurantism (where it is anchored by the class interests of the ruling classes).” This remark of Lenin emphasizes not only the assimilating-transcending character of dialectical materialism, but also the fact that even theoretical traditions opposed to it represent the inflation, or distension or linearization or apotheosization, call it what you wish, of some aspect, some facet, some feature of knowledge itself in its ascending spiral. In other words, even this apotheosization is based on a kernel of truth whose apotheosization it constitutes, a view that is also echoed in Georg Lukacs’ famous remark that even false consciousness has an element of truth.

Marxist theory in short does not just debunk or oppose tendencies hostile to it; it locates them, assimilates them and thereby transcends them. It represents the striving for a totality of understanding. It follows that Marxist theory must engage with all theoretical tendencies no matter how distant from itself; it must assimilate all nuggets of advance of knowledge, no matter what ideological tradition such nuggets may be found within.

Every such assimilation constitutes at the same time an advance of Marxism itself. It follows then that Marxism, through a continuous engagement with the entire field of development of knowledge, is also continuously developing itself, or, to re-cycle a phrase I had used once earlier, it is continuously reconstructing itself. It is marked by continuous creativity, continuous development and continuous reconstruction. Indeed it is the only theoretical endeavour that is marked by such continuous development, precisely because unlike all other “bourgeois” tendencies that deliberately shut their eyes to all developments of knowledge that reach out to a society beyond the bourgeois one, that remain staunchly committed to the dictum, which Marx attributed to Classical Political Economy, that “till now there has been history but henceforth there will be none”, it puts no such limitations upon itself.

V

To say this may appear obvious at first sight but it is not so. Indeed it runs counter to a very common understanding of Marxist theory. This understanding sees the development of Marxism in terms of a set of hierarchies: Marx had developed the basic theory of evolution of capitalism; Lenin developed within this overarching theory the analysis of the monopoly phase of capitalism which is but one component of this totality; Mao developed an analysis of the evolution of a third world society, namely China, in the period of monopoly capitalism; and so on. Each subsequent theoretical advance is seen as being theoretically of a lower order than the preceding one, thus setting up, as it were, a hierarchy of theories, rather reminiscent of the series of Russian dolls that are stacked one inside the other. At the same time, Marx’s original analysis is seen to have encapsulated within itself the entire scope, the totality of possibilities, of the development of the system itself.

This common understanding of Marxism is characterized by three interrelated features: one is a hierarchical ordering of the contributions of Marxist theorists; the second, which is necessarily a counterpart of the first, is the encapsulation of the totality of history (of capitalism) within a single theoretical schema, namely the one advanced by Marx; and the third, which is necessarily linked to the second, a downplaying of all those aspects of capitalism which are not emphasized by Marx, which means a downplaying of the question of demand and of the market (since Marx was occupied primarily by production relations), and a downplaying of capitalism’s relationship to other modes of production (since Marx was occupied primarily by a closed capitalist system).

This second interpretation of Marx, since it visualizes an encapsulation of the totality of history within Marx’s theoretical schema itself, entails applying a closure not just to history, namely that history cannot go beyond the perception of Marx, but to Marxism itself, namely that Marxism cannot go beyond the boundaries set by Marx. Marxism cannot develop; all possible development it is capable of has already been encapsulated within Marx’s idea, has already been anticipated by Marx; all that remains to be done is to elaborate this idea, to flesh it out, to give it a concrete shape, and to draw out its significance.

This view of Marxism represents the dialectical opposite of the view that was discussed earlier. It is a theory of closure, of viewing Marxism as a closed system as opposed to a theory that sees Marxism as an essentially open system, which is continuously in the process of development, and of reconstruction. It represents Marxist theory not just as the acme, but as the end, of all theory. It presents Marxist theory in a manner that is reminiscent of how Marx himself had portrayed Classical Political Economy: Marx had said of Classical Political Economy that according to it “till now there has been history, but no more henceforth”; according to this view of Marxist theory “till now there has been theory, but no more henceforth”.

To view Marxism as the end of all theory, or as the theory which encapsulates the entire future development of the capitalist system, is to see it as a new idealism. If this indeed was Marxist theory, then Marx’s criticism of Hegel could with justification have been addressed against him. This however is not Marx’s theory, and there is no further need to do to it what Marx had done to Hegel. In other words, what Marx had done to Hegel was not just an inversion in the sense of the mere turning of Hegel’s theory upside down, through the substitution of a new idealism for the old Hegelian idealism, but an “inversion” (to continue using Marx’s phrase for it) in a very different sense, an inversion that simultaneously represented a radical break, through the substitution of an open-ended scientific quest for a closed absolutization of an idea.

Such an absolutization is in fact the denial of authentic Marxist theoretical praxis. There is a joke about China in the old days, when a visitor to the country was introduced to an economist. The economist unashamedly claimed that he was the sixth greatest economist! Then the visitor was introduced to a poet who also unashamedly claimed to be the sixth greatest poet. When the visitor was next introduced to a painter, he too claimed to be the sixth greatest painter. By then the visitor’s distaste of the boastfulness of his new acquaintances had given way to an amazement at the curious uniformity of the answers. So, he finally asked: “who by the way are the five better painters”? The answer promptly came: “Why? Marx, Engels, Lenin, Stalin, and Mao, of course!” This pantheon, this hierarchy constitutes a ritual, but nonetheless real, devaluation of the economist’s, the poet’s, and the painter’s praxis. It constitutes a religious rather than a scientific attitude. Jean Paul Sartre in his play Lucifer and the Lord had written: “God is the denial of man”. The hierarchical interpretation of Marx makes Marx a denial of the Marxists. It is an ultimate insult to the rugged greatness of Marx to apotheosize him, to use him as a means of self-deprecation by Marxist theoretical practitioners, since such self-deprecation constitutes a deprecation of theoretical praxis itself, an excuse for theoretical irresponsibility, and hence an alibi for remaining steeped within a lazy mediocrity that ultimately enfeebles Marxism theoretically. The apotheosis of Marx is simultaneously a means of the liquidation of Marxism.

Althusser had used the imagery of Marx having opened up a continent for exploration, the continent of history, rather like Thales opening up the continent of Mathematics. The hierarchical view of Marx is lazy, self-deprecating, and un-Marxist, in the sense of being theoretically enfeebling (rather like the Soviet text-books on political economy which reproduce Marx’s own original arithmetical examples), because it remains content taking shelter in that little corner of the continent which Marx had the time to explore, instead of venturing out to explore the hitherto unexplored parts of it.

In fact this hierarchical view of Marxist theoretical praxis was not only foreign to Marx himself but to Marxists during the golden years of the flowering of Marxist theory around the first world war. I have already referred to the nature of Lenin’s theoretical praxis in his opus Imperialism. Rosa Luxemburg, an outstanding proletarian revolutionary and follower of Marx, not only broke fresh ground by going beyond Marx’s analysis of the accumulation process, but made no secret of her criticism of Marx’s analysis. And even though her Accumulation of Capital was critiqued very strongly among contemporary Marxists, the critiques related to the substance of her argument but never to the fact per se of her having moved away from Marx’s analysis of accumulation.

VI

Marx’s theoretical analysis of capitalism itself is structured in a manner that keeps it “open”. It is noteworthy that Marx does not have a theory of growth, or a theory of crises, or a theory of any sort illuminating the dynamic course that capitalism would take. In this respect, the very structure of Marx’s theoretical opus is so different both from those of his classical predecessors, and from those of his neo-classical successors in the realm of political economy. Both these “bourgeois” trends in political economy are characterized by specific theoretical structures for explaining specific phenomena, and specific “models” of the trajectory of capitalist evolution. There is for instance a Ricardian theory of growth, a Schumpeterian theory of growth, and in more recent times a Solovian or a Kaldorian theory of growth. But there is no corresponding Marxian theory of growth. This is because Marx’s concern is not at all with mapping how the system moves over historical time, but rather with highlighting the social relations underlying the system and how the system spontaneously (even through the precipitation of crises) reproduces these relations, though not as the mirror image of how they were in the past. (For instance, the centralization of capital over time, the increase in the scale of production over time etc. entail that the reproduction of the basic relations of the system does not take the “mirror image” form). Robert Heilbroner has rightly said that Marxist economics is fundamentally “relational”; but precisely because it is “relational”, it leaves “open” the whole question of how exactly the system moves, how it evolves and develops through historical time. Hence the very structure of Marxist economics, and therefore, by implication, of Marxist theory, makes it “open-ended”, permitting the “filling up” of the theory through further development, assimilation, and absorption.

This incidentally should also answer the question that may have arisen in the minds of many readers by now, namely, that if Marxist theory develops by assimilating and absorbing all authentic developments of knowledge, then what remains of Marxist theory itself? Does it not become reduced then to a mere portmanteau of ideas? The answer to this question lies in the fact that the “open-endedness” of Marxism is founded upon its analysis of the basic social relations underlying the system, which get “spontaneously” reproduced, but never in a “mirror-image” fashion, even though this “spontaneity” encompasses the precipitation of minor and major crises.

VII

The “isolationist” view of Marxist theory, which stands in contrast to the view that I have been advancing above, has been particularly constricting in two crucial areas. One is with regard to capitalist crises and the problem of effective demand, notwithstanding the fact that one of the co-pioneers of the theory of effective demand, along with John Maynard Keynes, was Michael Kalecki, a Polish Marxist. Marx had been extremely critical of Ricardo’s proposition that a situation of generalized over-production could not arise in a capitalist economy. He had been quite explicit that the claim of such impossibility, which was rooted in a Law propounded by the French economist J.B.Say to the effect that “supply creates its own demand” could not hold in an economy where purchasing power could be stored in the form of money. In a sense therefore Marx may be said to have been the true pioneer of the theory of effective demand, i.e. the theory that it need not equal full capacity output, and hence to have anticipated the Keynes-Kalecki revolution by almost three quarters of a century. But even though Marx was a pioneer of this revolution which related to the problem of “realization” of value of the produced output in a capitalist economy, he did not give it centre-stage in his analysis. And since realization is a matter that relates to the sphere of circulation rather than the sphere of production, which is considered primary in Marxist theory, later Marxists have tended to underplay the problem of effective demand. As a result, instead of appropriating the Kalecki-Keynes revolution that actually originated with Marx, Marxist theorists have tended to downplay the problem of demand, and the seriousness of realization crises, often sounding in this respect like orthodox bourgeois economists keen on presenting a “prettified” picture of capitalism.

So strong has this tendency been that even during the Great Depression, the Communist International’s emphasis was not on the anarchy and irrationality of the system that kept millions of workers unemployed in the advanced capitalist world and millions of peasants destitute in the third world owing to the disastrous collapse of primary commodity prices, but on the fact that capitalism was “shifting the burden of the crisis” to the periphery, even though by its very nature any such shift in the burden could only worsen the crisis. It is because of this “isolationism” that Marxist theory, especially that which emanated from the Soviet Union, completely underestimated the stabilizing role of Keynesian demand management by the State in the post-war period, and mistakenly identified what has often been called “the Golden Age of Capitalism” as the third phase of the General Crisis of Capitalism! This atrophy of theory, and the complete misreading of the world situation that accompanied it, was no small a factor contributing to the setbacks received by the revolutionary movement subsequently.

The second area where the “isolationist” interpretation of Marxist theory has been constricting is with regard to imperialism. Even though Marx wrote more feelingly and more insightfully on colonialism than any other writer in the nineteenth century, his writings on colonialism largely stood apart from his theoretical analysis of capitalism as developed in Capital. Luxemburg’s effort to locate interactions with the pre-capitalist and non-capitalist segments at the centre of the accumulation process under capitalism, did not find general acceptance among her contemporary Marxist writers. Lenin was the first to bring imperialism successfully to the centre-stage of Marxist analysis, but of course the phase of imperialism he talked about was the phase of finance capital, and his focus was on inter-imperialist rivalry which was natural in the context of the first world war. But a consequence of all this was that the impact of colonialism/imperialism on pre-capitalist societies remained insufficiently analyzed (until by Marxist historians much later), and a number of facile generalizations made about imperialism continued to persist and do so even today.

One such generalization relates to the “modernizing role of imperialism” in backward societies. In the contemporary context, this generalization translates itself into the proposition that integration with world capitalism through the pursuit of neo-liberal policies has a “progressive” and “modernizing” role in backward societies. The simplest expression of this argument in economic terms is the “so-called dual economy model” where the economic universe is characterized by a “modern” capitalist sector and a “backward” traditional sector. The expansion of the “modern” sector keeps absorbing more and more labour from the “traditional” sector, which results over time in a progressive attenuation of the “backward” sector; but even as the “backward” sector dwindles in significance, this very dwindling, because it is accompanied by an exodus of labour out of it, and hence by a lessening of the magnitude of labour reserves located within it, brings about an improvement in the condition of life of the work-force that remains within it (i.e. a “trickle down” of the benefits of expansion of the “modern” capitalist sector is felt within the “backward” traditional sector even as the latter dwindles in size). And since the “traditional” sector is seen as the repository of feudal-patriarchal consciousness, the impact of the expansion of the “modern” capitalist sector, such as would occur through the pursuit of neo-liberal policies of closer integration with imperialism, is the “modernization” of society.

This argument which was universally rejected earlier in the third world for the obvious reason inter alia that integration into the colonial system and the colonial pattern of international division of labour, even as it implanted capitalist relations into the third world society, was simultaneously a constraining factor on the growth of the “modern” capitalist sector, has gained currency of late because of the somewhat impressive rates of growth witnessed in several of the so-called “newly-emerging” economies. The argument is put forward by bourgeois defenders of neo-liberalism that what happened in history is irrelevant (though some of them would even argue that the bleak picture of colonialism that is often painted is itself incorrect); contemporary “globalization”, i.e. integration with imperialism in the contemporary context does have this “modernizing” and “developing” effect, an argument strongly espoused by the contemporary third world bourgeoisie itself.

Much has been written on the flaws of these “dual economy” models, and I need not repeat all that here. Suffice it to say that the basic perception underlying the model and the ensuing argument is wrong, since it misses the dialectic between the “modernity” of the “modern” sector and the “backwardness” of the “backward” sector, the fact that the two are not disjointed sectors standing apart from one another, but are dialectically linked and constitute one indivisible unity. The expansion at one pole of this unity, i.e. in the so-called “modern” sector is accompanied in economic terms by a retrogression at another pole, i.e. in the so-called “traditional” sector; the growth of income and wealth in the former is accompanied by dispossession and absolute impoverishment in the latter, without this dispossession being offset by any shift of the work-force from the latter to the former, from which it follows that the basic Marxist understanding developed during the anti-colonial struggle, that in third world societies it is only a democratic revolution led by the working class in alliance with the peasantry, which consciously prepares the ground for a transition to socialism, that can act as the harbinger of progress and modernity, remains equally valid under the contemporary conditions of “globalization”.

But here too, as in the case of the theory of effective demand, an “isolationist” Marxist understanding which cannot theoretically locate the exploitation of the third world peasants and petty producers within its strictly orthodox perception of the capitalist mode of production based on a binary opposition between the capitalists and the workers, and which is misled by the apparent “dynamism” of the capitalist segment within several third world economies in the era of “globalization”, remains unclear about the direction of the system’s movement and proves unequal to the task of challenging “globalization”.

VIII

Let me draw together the threads of the argument. I have in this lecture distinguished between two different interpretations of Marxist theory. One looks at Marxist theory as an open system that is continuously in the process of development, or, putting it differently, that is continuously reconstructing itself anew by engaging with the world of ideas in general, and appropriating, and hence also going beyond, what is scientific in any tradition, no matter what the attitude of that tradition to Marxism. Marxist theory on this view, while building on certain basic tenets of Marx also goes beyond Marx and explores the “continent” that he opened up.

The second interpretation which was quite prevalent during the Comintern years and remains influential even today is suspicious of any attempt at assimilating propositions arrived at by other traditions. It sees Marx’s theory as having encapsulated capitalist evolution in its entirety, with only elaborations within its fold remaining to be done, and the task of such elaboration being distinctly of a lower theoretical order. This hierarchical, isolationist, closed, and essentially “productionist” view however, precisely because of its reluctance to engage with the world of ideas in general, becomes atrophied over time and contributes to a theoretical enfeebling of Marxism. It is important for Marxist theory, especially today, to break out of this isolationism, to engage vigorously with the world of ideas in general, and thereby to enrich itself to cope with the unfolding reality of the world capitalist crisis, that presages major upheavals, including perhaps even revolutionary upheavals in the foreseeable future.