A Characterisation of Economic Romanticism, Chapter 1 - Part 71

Lenin is quite right that distribution has no independent existence, and before the question of demand and supply can be examined, the relation of distribution to production relations must be examined, but, as Marx explains in The Grundrisse, production is consumption and consumption is production. The worker produces labour-power by consuming commodities required for their own reproduction. Labour-power is consumed in the labour process in producing commodities. Commodities, in the form of fixed capital and raw and auxiliary materials, are consumed in the production process. Lenin makes the mistake of the Ricardians of wanting to make consumption entirely and automatically determined by production, and of not seeing that production itself, or more correctly reproduction is simultaneously conditioned by consumption.

“Supply and demand determine the market-price, and so does the market-price, and the market-value in the further analysis, determine supply and demand. This is obvious in the case of demand, since it moves in a direction opposite to prices, swelling when prices fall, and vice versa. But this is also true of supply. Because the prices of means of production incorporated in the offered commodities determine the demand for these means of production, and thus the supply of commodities whose supply embraces the demand for these means of production. The prices of cotton are determinants in the supply of cotton goods.

To this confusion — determining prices through demand and supply, and, at the same time, determining supply and demand through prices — must be added that demand determines supply, just as supply determines demand, and production determines the market, as well as the market determines production.”

(Capital III, Chapter 10)

Without consumption, the circuit of capital cannot be completed. Indeed, as Marx sets out, in Capital II, unless consumption occurs within a given amount of time, after production, the circuit of capital is broken, and reproduction cannot occur. In other words, Lenin, in his justifiable desire to oppose the petty-bourgeois moralism of Sismondi and the Narodniks, has fallen into the same errors as the Ricardians.

Sismondi attacked Ricardo for presenting an analysis of society on scientific principles. In other words, he dealt with what is, rather than the moralist approach of what ought to be. The same is seen today with those moral socialists who bemoan the actions of the capitalist state, rather than explaining honestly, and scientifically, why it is inevitable that this state, as a class state, acts in the ways they object to. In large part, that is down to the fact that these petty-bourgeois socialists are themselves statists. They have abandoned all perspective of working-class self-activity and self-government, and instead place their faith in the state itself performing the historic tasks of the proletariat. That was the same perspective of Sismondi and the Narodniks. But, to hold this perspective is then to abandon the Marxist analysis of the state as a class state. It requires a belief that the state, often confused with government, is class neutral, an empty vessel waiting to be filled with class content, or, worse still, waiting simply to be filled with the ideas required to advance the interests of “the nation”, ideas that are somehow, objectively true, and simply waiting for the intelligentsia to discover.

“We fully understand their fear: the frank admission of reality would completely cut the ground from under the sentimental (Narodnik) criticism of capitalism. It is not surprising that they so ardently rush into battle before they have had time to clean the rusty weapon of romanticism. It is not surprising that they are unscrupulous in their methods and want to present hostility towards sentimental criticism as hostility towards criticism in general. After all, they are fighting for their right to existence.” (p 206)

And, so too with today's romanticists. Its not that Marxists reject criticism of capitalism/imperialism, but that we reject the petty-bourgeois, moralistic criticism of it – and the same applies to the criticism of Stalinism and the deformed workers' states. That moralistic criticism is inevitably reactionary, unable to provide any realistic way forward from the reality of capitalism/imperialism/Stalinism, it inevitably points backwards to a former state of things, in which such morally objectionable phenomenon are thought not to exist – but, of course, other, often worse, morally objectionable phenomena, in reality, accompany those past conditions, and even more so when an attempt to return to them is made when the world has moved on.

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