Review of The Political Economy of Development (November Socialist Standard)

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    Comment from one of the authors, Ben Fine:

    Thanks for this and hope all is well. My only comment is to ask whether you have actually read the book. It is incomprehensible how you have come to the view that it follows a Keynesian approach or proposes Keynesian solutions.



    Haven’t read this one but his guide to ‘Capital’ is probably the best around. ‘From Political Economy to Economics’ is pretty good as well, at least the bits I read where.He didn’t seem to be a Keynesian.



    I agree. His book on Capital is good. I think he’s ex-Communist Party. Some people who consider themselves Marxists are in fact leftwing Keynesians. Maybe some of the authors of the Political Economy of Development fall into this category.



    Hi!Comrade LEW has also reviewed two other books written or co-authored by Professor Fine:Marx’s Capital. By Ben Fine and Alfredo Saad-Filho, Pluto Press, 2004. This book was favourably reviewed in the Socialist Standard when it was first published in 1975 and again with the third edition of 1989. This fourth edition is substantially rewritten, doubling the text length, yet still coming in at under 200 pages. This is quite an achievement for an introduction to the thousands of pages in the three volumes of Marx’s Capital, as well as some of the multi-volume Theories of Surplus Value, the so-called fourth volume of Capital. As the authors point out, “Marx is not interested primarily in constructing a price theory, a set of efficiency criteria or a series of welfare propositions; he never intended to be a narrow ‘economist’ or even a political economist”. Rather, they argue that Marx sought to challenge the assumptions that political economy (the older and more accurate term for economics) makes about capitalism:“the monopoly of the means of production by a small minority, the wage employment of the majority, the distribution of the products by monetary exchange, and remuneration involving the economic categories of prices, profits and wages”. As an introduction to Marx’s Capital, this book offers a much more reliable guide than the late Ernest Mandel’s 1976 introduction in the current Penguin edition of Capital. Mandel, in common with other Trotskyists, defended the then USSR in the misguided belief that it had overthrown capitalism.  Social capital? Theories of Social Capital. By Ben Fine, Pluto Press, 2010 In Marxian economics capital only exists when the appropriate historical and social conditions are present. Specifically, when the means of production are generally used to exploit wage labour for profit. In capitalist economics capital is one of the ‘factors of production’ along with land and labour (and, in some definitions, entrepreneurship or management). Capital is money invested in production with the expectation of profit, though in capitalist economics capital is primarily a timeless asset. This is why those who have been exposed to capitalist economics will sometimes express bafflement at the socialist proposal to abolish capital. ‘But any society must have capital,’ they exclaim, as if we propose to physically destroy means of production. No, any modern society must have means of production (land, factories, railways, etc.), but it is only in the capitalist system of society that the means of production takes the form of capital. Socialists want to abolish capital by establishing common ownership of the means of production, replacing production for profit with production solely for use. In the last 20 years or so, in an attempt to promote the illusion of the inevitability of capital, the term has been widened to include ‘social capital’. Fine defines social capital as ‘any aspect of the social that cannot be deemed to be economic but which can be deemed to be an asset’. It can be anything from your personal acquaintances, through communal or associational activity, to your identity or culture, and so on. The objective, whether clearly recognised as such or not, is to get the notion of profit into every aspect of our lives. It should come as no surprise that one of the main sponsors of the idea of ‘social capital’ is the World Bank, though its use is now well-established in certain academic disciplines, such as management studies. Fine has also written, along with Alfredo Saad-Filho, a highly recommended work on Marxian economics called Marx’s ‘Capital’. Now in its fourth edition (2003) it is a remarkably succinct summary (216 pages) of Marx’s multi-volume Capital. Yours for Socialism, Robert Stafford


    Reply received from LEW who wrote the book review:The review noted that The Political Economy of Development provided detailed evidence of the failures of the World Bank and the neo-liberal assumptions which still guide its activities. But we ask again: What of the alternative? ln a chapter co-authored by Fine, it is argued that “lt is insufficient simply to inform of more appropriate analytical frameworks and content” and that progress crucially depends upon “‘activism’ against the Bank’s roles in advocacy, scholarship and policy” (p.45; original emphasis). In the book’s Concluding Remarks, also co-authored by Fine, a number of recommendations are made with regard to the Bank’s roles, particularly in the way it carries out its research (p.281-282).Leaving to one side the nature of those recommendations, it is clear that the contributors to this book see a continuing role for banks in general and the World Bank in particular. In that case it is inevitable that they will follow one monetary policy or another. When it comes to monetary policy there is only either the neo-liberal ideology of “sound money” (what used to be called “monetarism”) or broadly defined keynesianism which according to the original review is governments spending their way out of trouble. (This probably does an injustice to Keynes but it is how Keynesiansim is generally understood.) In other words, either the currency is issued sufficient for capitalism to operate or the currency issue is inflated for political ends.The contributors to the book reject neo-liberalism; Fine now says the book does not propose Keynesian approaches or solutions, though that is not stated or implied anywhere in the book. Perhaps Ben Fine can explain what monetary policy he does favour?



    Hi!These are possibly the last words on this subject from Professor Fine:”this is like saying something is cheese or it is not cheese. so either you believe money should be cheese or you do not believe money should be cheese. as we clearly do not believe money is cheese, we will just have to accept money is not cheese. in case you do not follow, you are putting yourself in a straitjacket of seeing those other than yourself as keynesian or monetarist. but others are not and do nto see themselves in this way. have fun.”YFS.,Robert Stafford     



    Strange that someone like Ben Fine who knows enough about Marx’s views to be able to write a very good introduction to Capital seems not to realise that Marx envisaged capitalism being replaced by a society in which money would have no place. Suzanne de Brunhoff is another who wrote a whole book on “Marx on Money” without  realising that there can be so such thing as a marxist monetary policy.The explanation might lie in the fact that both are former members of the old Communist Party which also produced people who were able to apply the materialist conception of history very ably to past events but not to contemporary ones.Here’s another comment on Fine from a book review in the October 2006 issue of the Socialist Standard:

    Others, despite their reputations, are obviously mere reformists, especially two ex-members of a Communist Party, Ben Fine and Suzanne de Brunhoff. The former, who can’t have known about Chattopadhyay’s contribution, talks of “some form of wage labour persisting” in the first stage of socialist/communist society while the latter opines that “a new public regulation of markets and financial institutions is necessary”.
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