The Poverty of Marxist Crisis Theory During the Great Depression

Canadian Review of American Studies/Revue amadienne d'etudes amei1a1mes Volume 26, Number 2, Spnng 1996, pp. 27-61 The Poverty of Marxist Crisis Theory During the Great Depression ChristopherPhelps The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid symptoms appear. (Gramsci 1971, 276) 27 American society during the Great Depression offered no end of stimuli to economic thought. Financial crash and industrial stagnation threw millions out of work, growth was anemic at best until the Second World War, and the consequent conviction that Karl Marx's economic anticipations had been proven correct led unprecedented numbers of intellectuals to embrace Marxism. Under such circumstances one might expect the American left to produce an outpouring of economic analysis, and that, indeed, is the presupposition of many accounts. Louis Adamic recalled "elaborate analyses and diagnoses of the rapidly disintegrating socio-economic structure of the United States" during the first years of the 1930s (1938, 325). "In those days," Malcolm Cowley concurred, "everyone was trying to be an economist of sorts. Writers studied 'conditions/ as they called them, in various cities or industries and tried to publish their findings as pamphlets 11 ( 1981, 27). But what is most striking about the contours of American economic thought in the 1930s is less the volume of contributions from the left that one would expect to find than the paucity of sustained Marxist crisis theory and debate. Between 1929, when a precipitous fall in stock market values 28 Canadi.rn Review of Amenc,rn Studies Reuue cmwd1em1e d'etudes ameitcmnes marked the end of the uneven prosperity of the twenties, and the early 1940s, when global war initiated the long boom, no torrent of Marxist analyses rushed toward an understanding of the causes of capitalist crises 1t1 general, or the character of the Great Depression in particular. In the opening years of the thirties, the most notable left-wing work on the collapse was TragicAmerici:1 (1932) by the novelist Theodore Dreiser, who enumerated capitalism's faults but offered little explanation for the cause, timing or depth of the crisis.1 Americans fluent in Marxist political economy were also virtually absent from The Encyclopaediaol the Social Sciences (19301935 ). While open to radical perspectives, contributors, and editors, the Encyclop,iediarelied exclusively upon European writers for its sections on "Capitalism," "Crises," "Karl Marx, JI "Socialist Economics, JI and "Overproduction .Jl2 The sole American contributor to a category related to crisis theory or Marxist political economy was Wesley Mitchell, who was neither a Marxist nor a radical and whose entry, "Business Cycles, 11 made not the slightest mention of Marxian crisis theories:~ Even by the close of the decade, the body of American Marxist economic theory was unimpressive. "There exists in English no reasonably comprehensive analytical study of Marxian political economy," wrote Paul Sweezy at the outset of his Theory ol CapitalistDeuelopme11t(1942b, vii). Sweezy had spoken to the paradox of American Marxism in the 1930s. In the midst of capitalism's apparent ruin, during a period when radical intellectual life was dominated by a Communist Party with a self-professedly Marxist orientation , in a decade when militant union organizing at the point of production was the left's central purpose, not one radical intellectual in the United Stc1tes had produced so much as a serious, thorough overview of Marxian political economy. Not until recovery was underway and the left discombobulated by war did a young scholar, Sweezy, step forward to produce a solid exposition of Marxist economic theory. The mystery of the 1930s, thus, is less the economic obsessions alleged in countless narratives than the paradox that a stunted, inadequate Marxist crisis theory was all that issued from such a moment. ChristopherP/Jelps/ 29 The Conservatism of Economics Why was there so little Marxist crisis theory in the United States during the 1930s? Why was that which did exist so poor in quality? If our expectations are betrayed, it is because ideas do not arise neatly in response to events. The capacity of theories to emerge and take shape is determined not just by their appropriateness or validity, though merit is...