Paul Mason’s PostCapitalism: A response to Joseph Choonara

Issue: 149

Pete Green

It came as no surprise that International Socialism could publish, in the last issue, such a dismissive review of Paul Mason’s fascinating and thought-provoking new book.1 Certainly Mason has moved a considerable distance from the Leninism of his youth and now advocates a politics which uneasily combines elements of left reformism with an autonomist focus on the emergence of alternative forms of cooperative endeavour within contemporary capitalism. Mason’s provocative thesis that Wikipedia and the Anonymous network, rather than the Petrograd Soviet of 1917, anticipate the future of a “post-capitalist” society has predictably met with obdurate rejection by all who still think that the Bolshevik revolution provides us with a model for the path to socialism. But if that was all that Mason’s book had to say I would not have bothered to write this response to Joseph Choonara’s review.

Choonara, to be fair, focuses much of his review on the economic analysis in Mason’s book and attempts to deal with that on its own merits. Nevertheless, I was disappointed that his review either failed to acknowledge, or seriously misread, Mason’s illuminating if sketchy observations on the relevance of Marx’s theory of value to exploring the deeply contradictory character of contemporary capitalism in general and the impact of IT in
particular. Instead Choonara simply assimilates Mason’s position to that of Michael Hardt and Antonio Negri, who maintain that the labour theory of value is no longer applicable in a world where labour has supposedly become “immeasurable”.2 It is that mistake which prompted this response and on which I want to focus most of what follows. I will not dwell on the more problematic character of Mason’s conception of historical agency because that raises questions of analysis and strategy which would demand a much longer response than is possible here.

Certainly Mason draws on earlier work by Negri as well as such deviant Marxists as André Gorz and Manuel Castells. One could extend the eclectic list of influences considerably because Mason is a magpie type of thinker whose work as a globe-trotting journalist has somehow been combined with dipping into an impressively wide range of Marxist and non-Marxist writers. But the review’s sweeping comment, that there is little here that has not appeared elsewhere, is comparable to saying that there was nothing new in John Heartfield’s photomontages because he cut out all the photographic elements from somewhere else and just added a caption.

To give just one example, Choonara ignores completely the juxtaposition towards the end of Mason’s book of two quite distinct processes. Firstly, there is a discussion of the transition from feudalism to capitalism in Western Europe which emphasises the interplay between internal and external factors. One critical external factor, contributing to what historians call the “general crisis of feudalism”, was the Black Death, the plague that swept across Europe after 1347. In Mason’s summary this was an “external shock that helped to collapse an internally weakened system”.3 New technologies such as the printing press, the development of banking and trade and the conquest of the Americas all played a role in a “complex interplay of factors”. All of that is certainly derivative from the work of economic historians. But Mason then proceeds to suggest in his next chapter that climate change, along with related issues such as energy depletion and migration, is likely to be our equivalent of the Black Death, putting “the whole global system under strain” and “democracy itself in danger”. Of course, one can disagree with the details of the historical analysis, and it would be wrong to identify climate change as “external” to capitalism; Mason could have been a little more careful in his presentation in that respect because he manifestly does hold capitalism responsible for carbon emissions. But the historical analogy is imaginative, thought-provoking and certainly not “passé”.

Choonara neglects even to mention in passing Mason’s iconoclastic (for contemporary Marxists) attempt to draw a parallel between the transition from feudalism to capitalism and the projected transition to “post-capitalism”, which is one of the central themes of the book. Instead he critiques Mason’s use of historical stories to “buttress arguments about the contemporary world”, as if writers in this journal have always been completely innocent of such discursive manoeuvres.

That comment followed one piece of criticism where Choonara gets it right. Mason’s account of Lenin’s split with Alexander Bogdanov is misleading and does ignore the rather important point that Bogdanov led the “left” opposition to Lenin after the defeat of the 1905 revolution. Yet in his rush to the defence of Lenin, Choonara himself ignores Mason’s revelatory account of Bogdanov’s utopian science fiction novel Red Star, which is why its author features in Mason’s narrative. The omission is sadly symptomatic of Choonara’s reluctance to engage seriously with the utopian and visionary dimension of Mason’s book.

Rather than dwelling on that issue, however, I want to address the two critiques at the core of Choonara’s review. In both cases I think Choonara has seriously misread what Mason is saying, in part because he has not read the book carefully enough and in part because he has simply amalgamated Mason’s ideas with those of Hardt and Negri and other autonomists.

The first critique concerns Mason’s use of the Russian economist Nikolai Kondratiev and the question of long waves of expansion and decline (or stagnation) in the history of capitalism. Choonara’s critique runs along the following lines. He agrees that there are long periods of expansion and stagnation evident in the historical record but, like Leon Trotsky, questions their regularity. He acknowledges that Mason also references Trotsky but notes that Mason later uses the phrase “fifty-year cycle” repeatedly in his discussion of crisis theory. The danger of this is that it appears “to reduce the complexity of capitalism as a historical system to the simplicity of a mathematical formula”. On that we can agree. But then so does Mason in passages such as the following:

The long-wave pattern has been disrupted. The fourth long cycle was prolonged, distorted and ultimately broken by factors that have not occurred before in the history of capitalism: the defeat and moral surrender of organised labour; the rise of information technology and the discovery that once an unchallenged superpower exists, it can create money out of nothing for a long time.4

Whatever else you may want to say about that analysis it is certainly not one that reduces history to a simple mathematical formula.

Choonara then praises Mason for placing profit rates at the centre of his analysis and not simply relying on Kondratiev’s own explanation of long waves as a function of very long-term capital investments. Both Choonara and Mason stress that there are tendencies and counteracting tendencies at play as Karl Marx himself identified. This is an approach I also share. Where he disagrees with Mason at this point is simply over the issue of whether the turn to neoliberalism “restored profit rates from the late 1980s onward”.5 This of course touches on an extensive debate among Marxist economists which I cannot explore in any depth here but on which I tend to agree with Mason and the writers he references.

One can of course argue about how far profit rates were restored, and the usual comparison by writers such as Michael Roberts and Guglielmo Carchedi, on whom Choonara relies, is with the historically very exceptional peak of the mid-1960s for the United States economy alone. Anwar Shaikh certainly suggests that the recovery of profit rates from the early 1980s in the US did not take them back to the level of the earlier peak. But in the same article Shaikh also reasserts his own version of long-wave theory which is why Mason uses him in the book.6

Where Mason is absolutely correct in my view is his insistence that there have been critical periods when capitalism could only survive through deep structural adaptation or mutations. These are the transitions from one phase to another which earlier Marxists located in the long depression of the 1870s and 1880s leading to a new wave of imperialist expansion, and of course in the inter-war period which led to a new phase of state-managed capitalism. The crisis of the 1970s resulted in another mutation with the emergence of neoliberalism and renewed globalisation of capital. Mason suggests that this phase has now reached its limits, exposed not just by the financial crisis of 2008 but also by contradictions specific to the era of information technology. Mason is also correct to locate the gap between a rising mass of profits and the relative stagnation of investment as indicative of a contradiction specific to neoliberal capitalism with its prioritisation of shareholder value and preference for piling up cash reserves rather than making risky investments in what we call the productive economy.7

The most problematic implication of Choonara’s argument is that neoliberalism, and all that has accompanied it, including a transformation of the global division of labour with the growing share of manufacturing located in East Asia, had little impact on profitability globally (as distinct from the domestic US economy). Choonara relies on the argument developed by Chris Harman (from an original idea of Mike Kidron’s) back in the early 1980s that the size of capitals and state intervention have prevented the clearing out of the system and the devaluation of existing capital which characterised earlier crises. It is an argument which I endorsed at the time when it had a certain validity. But the most cursory examination of the scale of the protracted restructuring of capital since the early 1980s, alongside the disappearance of large sectors of the engineering, mining, shipbuilding and steel industries of countries such as Britain, confirms that thesis has long since ceased to adequately capture the dynamics of contemporary capitalism.

Mason, by contrast, takes seriously, with lots of data, the trends towards globalisation of capital, financialisation and what he terms, a little casually, the “doubling of the world’s workforce” with China’s move from autarchy to a major participant in world markets. Choonara pays little attention to this section of the book—perhaps because it reveals just how dated the orthodoxy of the Socialist Workers Party on these matters has become.

More surprising, however, is Choonara’s misreading of Mason’s position at the end of this section of his review. There he claims that “Mason argues that we are now seeing the combination of the end of the neoliberal solution to the downswing, and the embryonic beginnings of a new economic paradigm, the ‘fifth wave’, whose ‘core technology’ is ‘information’”.8 Now Mason may be a bit fuzzy on certain issues but on this point he is clear and it is pivotal to his core argument. Towards the end of his second chapter he notes that the so-called fifth wave began to emerge in the 1990s driven by network technology, a global marketplace and information goods. But he says that wave never got going—“it has stalled”.9 The reasons he gives for this are in many respects more interesting than the periodisation. Here we arrive at the focus of Choonara’s second critique.

Choonara claims that “the central notion in Mason’s book is that we are moving to an epoch in which information is rendering value irrelevant”.10 But that is to conflate two quite different notions. Certainly Mason envisages a postcapitalist future in which the law of value would no longer be central to the allocation of resources—but then so did Marx. Mason sees the seeds of such a future in the free labour expended on Wikipedia and opensource software to which the law of value obviously does not apply. But Mason is also defending the relevance of Marx’s theory to exposing the deep contradictions of “cognitive capitalism”. It is precisely because of the fact that information goods such as computer software can be reproduced (or copied!) with a minimal amount of labour that the marginal cost (the cost of producing an extra item) is driven towards zero.

This is a confirmation of Marx’s theory, not a critique of it. Choonara conflates this with a related but quite distinct question about the valuation of fixed capital. Some types of fixed capital such as computers are much cheaper but that’s not the critical argument. The threat to companies such as Microsoft, Apple and Google is that their massive investment in fixed capital, including all their research and development costs, will not be recovered in a competitive market. Only their ability to maintain a high degree of monopoly, protected above all in this epoch by so-called intellectual property rights globally, enabled them to make the vast profits they have stacked up over recent decades. Where hardware devices such as the iPhone are concerned, that profit derives in large part from the labour of super-exploited workers in Asia. Mason could have said more about that here as he has done elsewhere.11

Mason could also have elaborated more on the critical point that, as with all monopolistic structures, the profits of companies such as Google derive less from their own workers than from a transfer of surplus value via the pricing mechanism at the expense of other capitals in the system. When Choonara suggests in a footnote that “there is no reason in principle why other search engines could not in time erode this advantage”12 he is right, but that’s precisely the threat Mason is referring to. As the US Marxist Michael Perelman has explored in detail, the same clash between the high costs of fixed capital and low marginal costs threatened the viability of privately owned railroads in the US in the 19th century and monopolisation was the necessary response.13

Unfortunately Hardt and Negri, with whom Mason shares an interest in Marx’s fragment on machines in the Grundrisse, muddle things up by claiming that the categories of labour time and value are no longer relevant because the productivity of “mental” labourers is immeasurable. But that’s manifestly not Mason’s claim. Even if he echoes Negri with his references to “cognitive capitalism”, his core thesis is a derivation from Marx’s theory of value, not a break with it.

There is another objection to Mason’s argument which has more weight. Visions of a world of completely automated industrial production with most jobs eliminated remain just that—visions of a world which could only be realised in a post-capitalist society. That was Marx’s point in the fragment of the Grundrisse that Choonara himself quotes. When Marx anticipated the liberatory potential of capitalism’s development of technology he certainly wasn’t envisaging a smooth process of transition. Nor, to be fair, is Mason.

Moreover, while the global waged labour force has continued to expand, its composition and location has changed dramatically. To sum up a complex process rather crudely—the equivalents of the Petrograd factories of 1917 are today to be found in China and on the Mexican border rather than in Britain or the US. Outsourcing, offshore production and networks of sub-contractors are precisely the tendencies that Marx would have been examining if he was to rewrite those central chapters of Capital volume 1 on the organisation of production in Victorian Britain, which emphasised not the statistical average of the time of writing but the underlying tendency of capitalist development.

Choonara also dismisses Mason’s reference to the precariat, another topic that requires more space than is available. But the figure quoted by Choonara, that only 6 percent of workers in Britain are on temporary contracts, is grossly misleading. This excludes, for example, agency workers, who are classified as self-employed. The number of self-employed has risen rapidly in recent years to 15 percent of the labour force, with an average income of £11,000, which suggests that for most of them life is very precarious indeed.14 Nor does possession of a permanent contract in much of the non-unionised private sector offer much protection in this period.

In his conclusion, however, Choonara makes one argument with which I agree. The point of production remains a critical location of struggle even if that is not readily apparent from recent strike figures. Mason’s impressionistic invocation of a “networked humanity” as the agent of change is also far too fuzzy for my taste although its great merit is its resolute internationalism. I can only conclude by urging readers of International Socialism not to be deterred by Choonara’s review from reading Mason’s book for themselves.


Notes

1: Mason, 2015, reviewed by Joseph Choonara—Choonara, 2015a.

2: My own critical comments on Hardt and Negri’s Empire can be found in a review—Green, 2002.

3: Mason, 2015, p239.

4: Mason, 2015, p78.

5: Mason, 2015, p71.

6: Shaikh, 2011. I am however sceptical of the use of US national income accounts (by Carchedi, Roberts and Robert Brenner as well as Shaikh) for figures which, among other deficiencies, exclude the increasing share of profits from overseas accruing to US multinationals.

7: Although Mason doesn’t mention their work, studies by Erdogan Bakir and Al Campbell confirm this argument in detail (see for example Bakir and Campbell, 2010, and Bakir, 2015). Thanks to Jim Kincaid for these references.

8: Choonara, 2015a, p166.

9: Mason, 2015, p48.

10: Choonara, 2015a, p167.

11: Mason, 2013.

12: Choonara, 2015a, p171.

13: Perelman, 2006. Perelman is a writer whom Mason doesn’t reference but whose earlier work (Perelman, 2003) on intellectual property rights is also very relevant to his argument about the Googles and Microsofts of our period .

14: Choonara has addressed the issue of self-employment in the December 2015 issue of Socialist Review and rightly notes its diverse components—Choonara, 2015b. His claim that the percentage of the labour force in the category has only risen from 13 to 15 percent since 1993 is correct but ignores the sharp fall after 1993 and rise since 2008. These fluctuations are reminiscent of Marx’s characterisation of one element of the reserve army of labour, an analysis of the precariat of his day.


References

Bakir, Erdogan, 2015, “Capital Accumulation, Profitability and Crisis: Neoliberalism in the United States”, Review of Radical Political Economics, volume 47, number 3.

Bakir, Erdogan and Al Campbell 2010, “Neoliberalism, the Rate of Profit and the Rate of Accumulation”, Science and Society, volume 74, number 3, http://content.csbs.utah.edu/~al/articles/Sub_Neo_RP_Acc.pdf

Choonara, Joseph, 2015, “Brand New, You’re Retro”, International Socialism 148 (autumn), http://isj.org.uk/brand-new-youre-retro

Choonara, Joseph, 2015b, “Little Joy in Being Your Own Boss”, Socialist Review (December), http://socialistreview.org.uk/408/little-joy-being-your-own-boss

Green, Peter, 2002, “The Passage from Imperialism to Empire: A Commentary on Empire by Michael Hardt and Antonio Negri”, Historical Materialism, volume 10, issue 1.

Mason, Paul, 2013, Why It’s Still Kicking Off Everywhere: The New Global Revolutions (Verso).

Mason, Paul, 2015, PostCapitalism: A Guide to Our Future (Allen Lane).

Perelman, Michael, 2003, Steal This Idea: Intellectual Property Rights and the Corporate Confiscation of Creativity (Palgrave).

Perelman, Michael, 2006, Railroading Economics: The Creation of the Free Market Mythology (Monthly Review Press).

Shaikh, Anwar, 2011, “The First Great Recession of the 21st Century”, Socialist Register 2011: The Crisis This Time, available at www.anwarshaikhecon.org/index.php/publications/political-economy