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Book Reviews

Engels defrocked

The Frock-Coated Communist: the Revolutionary Life of Friedrich Engels. By Tristram Hunt: Allen Lane £25.

In February last year we reviewed John Green’s biography of Engels, and now along comes another. This one was launched with far more hype, coming as it does from a well-known publisher and being written by an up-and-coming academic and TV historian. Both contain ‘revolutionary life’ in their sub-titles, and even feature on their front covers versions of the same portrait of Engels at the age of twenty.

And of course both books tell essentially the same story. Engels was born to a capitalist family in Germany in 1820, and rebelled against his upbringing but was forced to spend twenty years working for the Manchester branch of the family firm. He supported Marx financially, till in 1869 he was able to retire, and the next year he moved to London. Besides helping Marx’s research into capitalism, he wrote classic works such as The Origin of the Family, Private Property and the State.

Where Green saw Engels as something of a proto-Bolshevik, Hunt has a more balanced view in this respect. ‘Contrary to Lenin’s later assertions,’ he says, ‘Engels was no vanguardist.’ He appreciated, too, that workers could come to power using the ballot box. Nor was he a Fabian or a supporter of the reformism pursued by the German Social Democrats. Despite some claims to the contrary, he was not responsible for the horrors of Stalinism, and did not corrupt Marx’s ideas in any way.

But Engels was not perfect, by any means. He had some anti-Irish prejudices, but he later put these aside. He does not seem, though, to have modified his anti-Slav views, which led him to call for the disappearance of ‘entire reactionary peoples’. He was against homosexuality, and was not sympathetic to the women’s movement. In the 1840s he apparently slept with the wife of Moses Hess, a former associate with whom he and Marx had fallen out, and then boasted that she was in love with him. Yet ‘the womanising Engels ended up authoring the foundation text of socialist feminism’ (i.e. Origin).

As Francis Wheen did when writing about Marx, Hunt concludes by noting how contemporary Engels now seems, when read in the context of economic recession and globalisation.

Capitalism against ecology

The Ecological Revolution – making peace with the planet by John Bellamy Foster. Monthly Review Press N.Y. 2009. $17.95

Recalling the goals of the 1992 Earth Summit in Rio, the principal document – Agenda 21 – was intended to launch a new age of sustainable development for the 21st century. But a decade later at the second summit in Johannesburg, it 'had turned out to be about sustaining capital accumulation at virtually any ecological cost.'

The book is a compilation of earlier articles, mostly from Monthly Review of which Foster is the editor, or from talks given at various venues around the world, e.g. the Marxism Conference 2002 in London, the Climate Change, Social Change Conference 2008 in Sydney, and adapted for this edition. As a consequence there is some recurrence of themes, however the repetition of key points in different contexts tends to reinforce their significance overall.

Organised in three sections, The Planetary Crisis, Marx's Ecology and Ecology and Revolution, Foster lays out the most up to date information and statistics on climate change and peak oil, etc from credible sources. One recurring theme is that society needs to be reorganised, 'away from the imperatives of accumulation, exploitation and degradation of the natural environment' and that 'the necessary change must be revolutionary in nature.' A reference in chapter 7, A Planetary Defeat, is to The Johannesburg Memo, written by 16 environmentalists who pointed to the abject failure of governments which, after committing to curb environmental decline etc., continued supporting policies which are gradually making all things worse. Again, the Johannesburg Memo, 'as long as corporations' long and short term interests diverge from the public interest no tinkering, reforms, regulations, or World Summits will change the status quo.'

The chapters of part one cover the workings of capitalism, the reasons the blame lies there and Foster's explanations of why things won't change without a system change. Part two is an analysis of various interpretations of Marx's connection to or disconnection from ecology and how different interpretations have tended to be uppermost at different periods of time. In the longest chapter, Marx's Theory of Metabolic Rift, Foster discusses what he sees as renewed emphasis on Marx and Liebig's treatment of soil fertility and ecological implications from agronomists and ecologists, especially regarding soil science and the struggles over agribusiness v. organic agriculture. He also points to Marx and Engels's emphasis on 'the need for the movement to address the alienation of nature in the attempt to create a sustainable society.' According to Foster the essential starting point for a truly revolutionary social ecology should be Marx's 'Good Ancestor' analogy. 'More than ever the world needs what Marx and others called for – the rational organisation of human metabolism with nature by freely associated producers.'

Part three contains Foster's argument that only a socialist revolution will suffice to generate conditions of equality, sustainability and human freedom and would necessarily draw its major impetus from the struggles of the working populations and communities at the bottom of the global hierarchy. Basic human needs must be ahead of all other needs and wants. 'There is the need for a revolt from below in support of social and ecological transformation, pointing beyond the existing system.'  'The transition to socialism and the transition to an ecological society are one.'

Global finance

The No-Nonsense Guide to Global Finance.  By Peter Stalker. New Internationalist.. 150 pages. £7.99.

By and large this book, one of a series published by the New Internationalist, is what its title says. But not quite. Stalker, himself a former co-editor of the magazine, writes correctly that commercial banks “make most of their money by charging borrowers a higher rate of interest than they give to the depositors” and that “without businesses prepared to put money to work, banks would be unable to offer interest on loans”, but then:

“Suppose, for example, 20 people have each deposited one hundred pounds of silver in the bank’s vaults. The total amount of money is thus two thousand pounds of silver. Then the 21st person comes along. He or she wants to borrow one hundred pounds. Certainly, sir or madam, please step this way. We can open an account for you and write into it one hundred pounds of silver. Now 21 people think they have 100 pounds and can spend it. The total amount of money has magically increased to 2,100 pounds of silver.”

No it hasn’t. How could it? If a bank could turn 2000 lbs of silver into 2100 lbs by a mere stroke of the pen that really would be magic, alchemy even. What it actually means is that one of the 100 lbs deposited has been lent to someone else to spend. There are still only 2000 lbs in existence, 100 in the hands of the borrower and 1900 in the vaults of the bank. The same would apply whether the original deposits were made in token money or by electronic transfer, but using metallic commodity money to illustrate the claim that banks “magically" create money is a good way to show it up as nonsense.

There follow chapters (most of the book) where Stalker explains in easy-to-understand terms, shares, hedge funds, derivates, deficit swaps and the like as well as international currency transactions and loans. It is only in the final chapter where he outlines the reforms he’d like to see that he goes off the rails again.

In a subsection entitled “Revoke licenses to print money” he says that 95 percent of money “materialises as if by magic, when commercial banks make loans to their customers”. He doesn’t seem to realise that this is because, confusingly, he along with most modern economists includes bank loans in the definition of ‘money’. On this definition, revoking the banks’ supposed “license to print money” ought, logically, to mean not allowing them to make loans. Yet on the next page:

“Banks would continue to offer loans, but they would do so in a much simpler fashion. Anything they lend would have to come from money deposited with them by savers, or borrowed from other banks, or from their tills, or from their own accounts held at the central bank.”

But this, essentially, is what happens today! Also, he is tacitly accepting here that bank loans don’t increase the ‘money supply’ and so are not really part of it.  Banks today no more have the power “to cream off extra profits by creating money” than they would have in his reformed capitalism.

Basic concepts

Unravelling Capitalism. A Guide to Marxist Political Economy. By Joseph Choonara. Bookmarks. 2009. 150 pages. £6.99

Zombie Capitalism. Global Crisis and the Relevance of Marx.  By Chris Harman. Bookmarks. 400 pages. £16.99

Choonara's short book is a good simple-to-follow introduction to the basic concepts of Marxian economics – from commodity, value, labour, labour power, and surplus value to rate of profit, organic composition of capital and price of production.

There’s the occasional reference to Trotsky and to the Russian revolution (Bolshevik coup) as a good thing but, after all, the author is a member of the SWP and the discerning reader will be able to discount these. Even so, it is surprising to see Mike Kidron’s “permanent arms economy” (that capitalism boomed after WW2 because wasteful expenditure on arms prevented the rate of profit from falling by slowing down the rate of capital accumulation) given another airing since it was so decisively refuted by the facts (those countries that spent less on arms boomed more). But this only takes up a few pages of an otherwise useful book.

Apart from the opening two chapters which cover the same ground as Choonara's book and in the same easy-to-follow way, Harman's book (published only a few months before he died in November) is by contrast dominated by Kidron's theory. In fact, Harman (the No 2 in the SWP under Tony Cliff) applies the theory much more widely than Kidron ever did, using it to attempt to explain the course of capitalist development since Marx's day. Thus the Great Depression of the 1880s only ended because of the naval arms race that began towards the end of the 1890s; the slump that followed the 1929 Wall Street Crash was due to the fact that there was not enough wasteful arms spending in the 1920s to slow down the rate of accumulation; WW2 ended this slump and post-war arms spending avoided another one till the 1970s. Then? Well, the permanent arms economy proved to be neither permanent nor enough: "The permanent arms economy had to be supplemented by the debt economy" (p. 289).

Despite this unsatisfactory analysis Harman does make some valid points. For instance, to those who blame the banks and bankers: "Finance is a parasite on the back of a parasite, not a problem that can be dealt with in isolation from capitalism as a whole".

Indian railways

Engines of Change. Ian J Kerr, Praeger Publishers

Although carried out in a rather annoying academic style, Engines of Change is nonetheless an excellent overview of the history of the railways of India from an economic and social perspective. One of the themes running through the book is the increasing state involvement in the running of the railways in India – partial government ownership beginning as early as 1870, less than twenty years after the opening of the first line. Marx gets a passing mention for his comment that the construction of railways under British rule would hasten industrialisation. By the end of British rule in India, up to 95 percent of the railway system was already nationalised. By the Raj – another nail in the coffin of the 'Nationalisation = Socialism' equation! On the same theme, it is interesting to note that ticketless travel, previously viewed as a nationalist anti-British protest, surged after independence – after all now 'the people' owned the trains. Currently some 6 million faredodgers every year find out just how far their ownership of Indian Railways extends.