Differential Accumulation: Toward a New Political Economy of Capital

Existing theories of capital, neo-classical as well as Marxist, are anchored in the material sphere of production and consumption. This article offers a new analytical framework for capital as a crystallization of power. The relative nature of power requires accumulation to be measured in differential, not absolute, terms. For absentee owners, the main goal is not to maximize pro.ts, but rather to ‘beat the average’ and exceed the ‘normal rate of return’. The theoretical framework builds on Thorstein Veblen’s separation of industry from business and on Lewis Mumford’s dichotomy between democratic and authoritarian techniques. Extending their contributions, we argue that capital is a business, not an industrial category, a human mega-machine rather than a material artefact. Indeed, it is the social essence of capital which makes accumulation possible in the .rst place. Capital measures the present value of future business earnings, and these depend not on the productivity of industry as such, but on the ability of absentee owners strategically to limit such productivity to their own differential ends. Introducing the twin concepts of the ‘differential power of capital’ (DPK) and the rate of ‘differential accumulation’ (DA), we examine the non-linear and possibly negative link between industrial growth and accumulation in the US

New imperialism or new capitalism?

Over the past century, the institution of capital and the process of its accumulation have been fundamentally transformed. By contrast, the theories that explain this institution and process have remained largely unchanged. The purpose of this paper is to address this mismatch. Using a broad brush, we outline a new, power theory of capital and accumulation. We use this theory to assess the changing meaning of the corporation and the capitalist state, the new ways in which capital gets accumulated and the specific historical trajectory of twentieth-century capitalism up to the present.arms; accumulation; capital flow; capitalism; conflict; corporation; crisis; distribution; elite; energy; finance; globalization; growth; imperialism; GPE; liberalism; Marxism; Middle East; military; national interest; neoclassical economics; neoliberalism; nomos; oil; OPEC; ownership; peace; power; profit; ruling class; security; stagflation; state; stock market; TNC; United States; US; utility; value; violence; war

The scientist and the church

The April 21, 2005 issue of the LONDON REVIEW OF BOOKS carried a lead article titled ‘Blood for Oil?’ The paper is attributed to a group of writers and activists – Iain Boal, T.J. Clark, Joseph Matthews and Michael Watts – who identify themselves by the collective name ‘Retort.’ In their article, the authors advance a supposedly new explanation for the wars in the Middle East. Much of their explanation – including both theory and fact – is plagiarized. It is cut and pasted, almost ‘as is,’ from our own work. The primary source is ‘The Weapondollar-Petrodollar Coalition,’ a 71 page chapter in our book THE GLOBAL POLITICAL ECONOMY OF ISRAEL (Pluto 2002). The authors also seem inspired, incognito, by our more recent papers, including ‘It’s All About Oil’ (2003), ‘Clash of Civilization or Capital Accumulation?’ (2004), ‘Beyond Neoliberalism’ (2004) and ‘Dominant Capital and the New Wars’ (2004). In their paper, the Retort group credits us for having coined the term ‘Weapondollar-Petrodollar Coalition’ – but dismiss our ‘precise calibration of the oil/war nexus’ as ‘perfunctory.’ This dismissal does not prevent them from freely appropriating, wholesale fashion, our concepts, ideas and theories – including, among others, the ‘era of free flow,’ the ‘era of limited flow,’ ‘energy conflicts,’ the ‘commercialization of arms exports,’ the ‘politicization of oil’ and the critique of the ‘scarcity thesis.’ Nowhere in their article do the authors mention the source of these concepts, ideas and theories; occasionally, they even introduce them with the prefix ‘Our view is. . . .’ Their treatment of facts is not very different. They freely use (sometimes without understanding) research methods, statistics and data that took us years to conceive, estimate and measure – again, never mentioning the source. These concepts, theories and facts are far from trivial. Until recently, they were greeted with strategic silence, from both right and left. Their publication has been repeatedly denied and censored by mainstream as well as progressive journals (including, it must be said, by the LONDON REVIEW OF BOOKS, that turned down our paper on the subject). They cannot be found anywhere else in the literature, conservative or radical. To treat them as ‘common knowledge’ is deceitful. To cut and paste them without due attribution is blatant plagiarism. The first part of our paper illustrates this process of ‘intellectual accumulation-by-dispossession’ with selected examples. The issue, though, goes well beyond personal vanity and self-aggrandizement. At the core, we are dealing here with the clash of science and church, with the constant attempt of organized faith – whether religious or academic – to disable, block and, if necessary, appropriate creativity and novelty. Creativity and novelty are dangerous. They defy dogma and undermine the conventional creed; they challenge the dominant ideology and threaten those in power; occasionally, they cause the entire edifice of power to crumble. For these reasons, the latent purpose of intellectual accumulation-by-dispossession – like the accumulation of private property – is primarily negative. The word ‘private’ comes from the Latin ‘privatus,’ meaning ‘restricted,’ and from ‘privare,’ which means ‘to deprive.’ And, indeed, the most important feature of private ownership is not to enable those who own, but to disable those who do not. It is only through the threat of prevention – or ‘strategic sabotage’ as Thorsein Veblen called it – that accumulation can take place. It is only by restricting the free creativity of society that society itself can be controlled. The second section of the paper explains how the appropriators of ‘Blood for Oil?’ fit this pattern. The final section of the paper is an epilogue. It describes our failed attempts to get this paper published with The LONDON REVIEW OF BOOKS; Retort’s efforts to mislead us; and some additional insight from their AFFLICTED POWERS, a 2005 Verso book that contains the same plagiarism and more. The epilogue concludes with a few observations on the nature of academic dialectics.academia; arms; accumulation; capital; capitalism; church; conflict; corporation; crisis; data; development; distribution; dual; economy; elite; energy; finance; globalization; growth; imperialism; distribution; institutionalism; IPE; liberalization; methodology; Middle East; military; national interest; science; security; oil; OPEC; ownership; peace; plagiarism; politics; power; profit; religion; ruling class; sabotage; stagflation; state; TNC; United States; violence; war

Cheap wars

The new conflicts of the twenty-first century – the 'infinite wars,' the 'clashes of civilization,' the 'new crusades' – are fundamentally different from the mass wars and statist military conflicts that characterized capitalism from the nineteenth century until the end of the Cold War. The novelty lies not so much in the military nature of the conflicts, as in the broader role that war now plays in capitalism.accumulation capital capitalism crisis differential accumulation distribution elite energy conflict globalization inflation Iraq Israel Keynesianism Lebanon Middle East military spending neo-liberalism oil ownership power prices profit ruling class TNC United States violence war warfare welfare Weapondollar-Petrodollar

Global Capital: Political Economy of Capitalist Power (YorkU, GS/POLS 6285 3.0, Graduate, Fall Term, 2011-12)

What is capital? Despite centuries of debate, there is no clear answer to this question – and for a good reason. Capital is a polemic term. The way we define it attests our theoretical biases, ideological disposition, view of politics, class consciousness, social position, and more. Is capital the same as machines, or is it merely a financial asset? Is it a material article or a social process? Is it a static substance or a dynamic entity? The form of capital, its existence as monetary wealth, is hardly in doubt. The problem is with the content, the stuff that makes capital grow – and on this issue there is no agreement whatsoever. For example, does capital accumulate because it is productive, or due to the exploitation of workers? Does capital expand from within capitalism, or does it need non-capitalist institutions like the state and other ‘external’ forces? Is accumulation synonymous with economic growth, or can capital expand by damaging production and undermining efficiency? What exactly is being accumulated? Does the value of capital represent utility, abstract labour – or perhaps something totally different, such as power or force? What units should we use to measure its accumulation? Surprisingly, these questions remain unanswered; in fact, with the victory of liberalism, most of them are no longer being asked. But the silence cannot last for long. As crisis and social strife intensify, the questions are bound to resurface. The accumulation of capital is the central process of capitalism, and unless we can clarify what that process means, we’ll remain unable to understand our world, let alone to change it. The seminar has two related goals: substantive and pedagogical. The substantive purpose is to tackle the question of capital head on. The course explores a spectrum of liberal and Marxist theories, ideologies and dogmas – as well as a radical alternative to these views. The argument is developed theoretically, historically and empirically. The first part of the seminar provides a critical overview of political economy, examining its historical emergence, triumph and eventual demise. The second part deals with the two ‘materialistic’ schools of capital – the liberal theory of utility and the Marxist theory of labour time – dissecting their structure, strengths and limitations. The third part brings power back in: it analyses the relation between accumulation and sabotage, studies the institutions of the corporation and the state and introduces a new framework – the capitalist mode of power. The final part offers an alternative approach – the theory of capital as power – and illustrates how this approach can shed light on conflict-ridden processes such as corporate merger, stagflation, imperialism and Middle East wars. Pedagogically, the seminar seeks to prepare students toward conducting their own independent re-search. Students are introduced to various electronic data sources, instructed in different methods of analysis and tutored in developing their empirical research skills. As the seminar progresses, these skills are used both to assess various theories and to develop the students’ own theoretical/empirical research projects

Capital and Power in the Global Political Economy (YorkU, AS4291 3.0, Undergraduate)

What is capital? Is it a material thing or social relation? What is political about it and how does it relate to power? What is the role of capital in the broader international political economy? The seminar examines such questions, both theoretically and historically. The first part deals with basic conceptions of capital, emphasizing the interaction between productivity and power, and examining how this interaction affected the evolution of transnational corporations. The second part looks at the changing relationship of business enterprise and states, illustrated for example by the three-way interplay between petroleum and armament firms, superpower confrontation, and Middle-East ‘energy conflicts.’ The third part focuses on the globalization of ownership and its domestic ramifications. Particular emphasis is put on the links between capital mobility and social transformation, such as the (re)capitalization of Russia, the Asian crisis and the changing ‘Asian model’, and the dramatic U-turns from ethnic conflict to transnational liberalism in South Africa and Israel

Political Economy: Major Themes (YorkU, GS/POLS 6272 3.0, Graduate, Fall Term, 2007-8)

At the dawn of the 21st century, more and more people realize that ‘economics’ and ‘politics’ are intimately related. And yet, these two aspects of social existence are usually studied as separate ‘disciplines,’ each with its own categories, language and theories. Can this departmentalization be overcome? Should it? And if so, how? The seminar deals with these questions by critically examining major themes of political economy. Topics are divided into two major categories: elements and aggregates. In the first part, the seminar examines the origins and implications of concepts such as supply and demand, equilibrium, utility and productivity, market organization, and the role of power. Part two, focusing on aggregates, covers the issues of national accounting, theories of prosperity and crisis, money and finance, economic policy, stagflation, welfare/warfare, and the global formations of trade, capital flows and currency regimes. Throughout the seminar, the emphasis is not only on the ‘how,’ but also on the ‘why.’ Where have the concepts and theories come from? Why have they risen to prominence and what brought them down? Who benefited from them and who paid the price? Do they help us understand the world, or do they serve to conceal it? In these explorations, special emphasis is put on methodology, as well as the importance of empirical/historical analysis

Global Capital: Political Economy of Capitalist Power (YorkU, GS/POLS 6285 3.0, Graduate)

What is capital? Is capital the same as machines, or is it merely a financial asset? Is it material or social? Is it static or dynamic? Surprisingly, these questions have no clear answers. The form of capital, its existence as monetary wealth, is hardly in doubt. The problem is with the content, the ‘stuff’ which makes capital grow, and on this issue there is no agreement whatsoever. For example, does capital accumulate because it is ‘productive,’ or due to the ‘exploitation’ of workers? Does capital expand ‘on its own,’ or does it need non-capitalist institutions such as the state? Can capital grow by undermining production and efficiency? What exactly is being accumulated? Does the value of capital represent a tangible ‘thing,’ ‘dead labour’ or perhaps something totally different? What units should we use to measure its accumulation? Despite centuries of debate, none of these questions has a clear answer. Yet they have to have answers. The accumulation of capital is the central process of capitalism, and unless we can clarify what that means, our theories remain ‘bagel theories,’ with a big hole in the middle. The seminar examines such questions theoretically and historically. The first part explores basic conceptions of capital. It begins by studying three approaches to capital: one based on utility, a second based on labour value and a third based on power. The discussion then broadens to examine these three approaches in relation to technology, the corporation and the state. The second part of the seminar deals with transformations of capital. This part introduces the twin concepts of dominant capital and differential accumulation. Using these concepts, the seminar explores the historical processes of corporate mergers, globalization, stagflation, imperialism and the new wars of the twenty-first century. [For electronic data resources, click on the link in Alternative Locations

Political Economy of Capital Accumulation (YorkU, LAPS/POLS 4292 6.0, Undergraduate, Fall Term, 2014-15)

Capital is the central power institution of capitalism: it is the main force underlying the relentless transformation of power relations in capitalist societies. The course explores the accumulation of capital from three interrelated perspectives: conceptual, historical and empirical. At the conceptual level, the course examines the evolution of different orthodox and critical theories of value and how these theories serve to explain and justify contending notions of accumulation. At the historical level, it traces the development of capital from its humble pre-capitalist origins to its present world dominance. At the empirical level, it studies and juxtaposes the qualitative and quantitative aspects of capital accumulation and study what they mean for the contemporary political economy. In parallel to these explorations, the course introduces students to the art and science of empirical research. By the end of the course, students are expected to be able to develop and integrate theoretical arguments with their own empirical work

Global Capital: Political Economy of Capitalist Power (GS 6285 3.0, Graduate)

What is capital? Is capital the same as machines, or is it merely a financial asset? Is it material or social? Is it static or dynamic? Surprisingly, these questions have no clear answers. The form of capital, its existence as monetary wealth, is hardly in doubt. The problem is with the content, the ‘stuff’ which makes capital grow, and on this there is no agreement whatsoever. For example, does capital accumulate because it is ‘productive,’ or due to the exploitation of workers? Does capital expand ‘on its own,’ or does it need non-capitalist institutions such as the state? Can capital grow by undermining production and efficiency? What exactly is being accumulated? Does the value of capital represent a tangible ‘thing,’ ‘dead labour’ or perhaps something totally different? What units should we use to measure its accumulation