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The Coming Meltdown of Traditional Capitalism

Published online by Cambridge University Press:  28 September 2012

Robert Heilbroner
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Abstract

Heilbroner challenges the concept that capitalism is purely an economic system and asserts it is rather a regime informed by social and political forces. The relentless pursuit of capital is the process by which the social order manifests its historical vigor. Within the regime of capitalism two realms of power and authority, the state and the economy, exist in a dialectic marked, in normal circumstances, by the concession of the incomparably more powerful state to the current interest of capital. However, the rise of international capitalism has changed this dynamic. Heilbroner describes this historical movement and ponders what capitalism will look like after its traditional form gives way.

Type
Articles
Information
Ethics & International Affairs , Volume 2 , March 1988 , pp. 63 - 77
Copyright
Copyright © Carnegie Council for Ethics in International Affairs 1988

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References

1 Among many excellent pieces let me mention Michael Moffitt's “Shocks, Deadlocks, and Scorched Earth: Reaganomics and the Decline of U.S. Hegemony,”World Policy Journal (Fall 1987). My own contribution is “Hard Times,” The New Yorker (September 13, 1987)Google Scholar.

2 Let us remember that Schumpeter tells us that “a century is a ‘short run’” for these purposes. See Capitalism, Socialism and Democracy (New York: Harper & Bros., 1942, 1947) p. 163Google Scholar.

3 From Gordon, David, “The Global Economy: New Edifice or Crumbling Foundations?” New Left Review (forthcoming) Table 1Google Scholar.

4 See Boland, Lawrence, “Stylized Facts,” in The New Palgrave (New York: Stockton Press, 1987) Vol. 4, p. 535Google Scholar.

5 The Nature and Logic of Capitalism (New York: Norton, 1985)Google Scholar; also “Capitalism,” in The New Palgrave, op.cit., Vol. 1, p. 347Google Scholar.

6 “You know what capital is? You think it's something you own, don't you? You think it's factories and machines and buildings and land and things you can sell and stocks and money and banks and corporations…. But you are mistaken. Capital is controlling things. Controlling things.” From Wolfe, Tom, The Bonfire of the Vanities (New York: Farrar, Straus, Giroux, 1987) p. 150Google Scholar. Implicit in this quotation is the belief that control, like power and prestige, also defies the laws of diminishing marginal utility. This widespread belief that an unslakeable thirst for power or prestige is part of “human nature” diverts our attention from a search for the psychological roots and symbolic meanings of these crucial elements of social behavior. I have examined this phenomenon in my book, The Nature and Logic of Capitalism, op. cit., pp. 46–52Google Scholar.

7 This interpretation makes capitalists, or the business-related echelons within the capitalist social order, a “universal class” in the sense suggested by Immanuel Wallerstein. This is a class whose interests are widely regarded, at least in ordinary times, as representing the interests of all. See Wallerstein, Immanuel, The Modern World-System Vol. 1 (San Diego: Academic Press, 1980) pp. 351–52Google Scholar.

8 Wallerstein, Immanuel, Historical Capitalism (London: Verso, 1983) p. 30Google Scholar, Bairoch, Paul in Just Faaland, Population and the World Economy (London: Blackwell, 1982) p. 162Google Scholar.

9 Calculated from Gordon, , “The Global Economy,” op. cit., Table 1Google Scholar.

10 See entries under “Kondratieff Cycle,”“Long Cycles,” and “Long Swings in Economic Growth,” in Boland, op. cit.; and “Long Swings and Stages of Capitalism,” in Gordon, David, Edwards, Richard, and Reich, Michael, Segmented Work, Divided Workers (New York: Cambridge University Press, 1982) ch. 2Google Scholar.

11 The hypothesis was originally put forward by Gordon, David in U.S. Capitalism in Crisis (New York: Union for Radical Political Economists, 1978)Google Scholar. See its further elaboration in Gordon, Edwards, and Reich, op. cit., and in Heilbroner, op. cit., ch. 6, “The Logic of Capitalist Development.”