The book Monopoly capital is written by Paul A. Baran and Paul M. Sweezy, both economists with a good name in the marxist school. Baran was born in the Soviet-Union, but he made his scientific career mainly in the United States of America (in short USA). Sweezy is an American by birth, who radicalized during the Great Depression, and then was converted to the marxist paradigm. He also was a professor at an American university, which is not granted to much marxists. Sweezy has published many books about socialism, and besides was the publisher of Monthly review, a socialist magazine. Baran has written several books, and besides has regularly published essays, notably in Monthly review. When two such prominent scientists combine their efforts, then the expectations are obviously high.
Monopoly capital appeared exactly at the right moment. New Left had benefited from the movement for civil rights, and was at the peak of its success. The American government was unpopular due to the setbacks in the Vietnam war. And in South-America left-wing guerrilla movements tried to seize power. In such a social climate the revolutionary theory of Marx suddenly becomes very concrete. Their is a willingness to change. Here it must be noted, that Monopoly capital sketches a picture of advancing monopolies, which actually mainly belongs to the Leninist interpretation, such as is stated by the cruel dictator V.I. Ulianov. The contents of the analysis in Monopoly capital indeed has some resemblance with similar studies, which at the time appeared in the Soviet-Union. Nevertheless, the book maintains its typically American character.
The originality of Monopoly capital is perhaps in the hypothesis, that the profit rate has the tendency to rise. For, Marx has always stated, that the profit rate has the tendency to fall. However, according to Baran and Sweezy that law is no longer true for monopolistic production. In itself their opinion is understandable, because the post-war years were characterized by an unprecedented welfare, also in the USA. Next the authors state, that the rise must eventually still end in a crisis. Besides, the book pays attention to at the time topical matters, such as imperialism and militarism (Vietnam!), and such as the inter-racial relations. More generally, the capitalist society is analyzed critically. It is a failure.
However, although Monopoly capital sketches a recognizable picture of the rebellious spirit of the time, unfortunately the story disappoints. Baran and Sweezy stick too much to Leninist phrases and dogma's, which are not very credible for your reviewer1. The similar work Economics by Hunt and Sherman is as radical and complete, but avoids the Leninist pitfalls. Therefore your reviewer prefers Economics, which even inspired one of the first reviews in this Gazette. Monopoly capital is so outdated, that ten years ago your reviewer could only acquire it at a Trotskist bookfair! Was it during a Turn-the-tide manifestation? This does not imply, that the book must be ignored. The creation of Baran and Sweezy remains a fascinating document of the time.
What can the reader expect to find in Monopoly capital? The authors believe that capitalism develops in the direction of oligopolistic structures. For the sake of convenience they call them monopolies, and in a more general sense monopoly capital. They want to closely investigate this phenomenon, and for this goal select the USA. In 1963 the produced surplus value, consisting of profits, interests, taxes and the like, is 56% of the gross domestic product (GDP). The industries are dominated by the managers of the monopolies. These are greedy. They want to maximize their own wage, and aim at huge profits. For this, the form of the oligopoly offers good chances, and it reduces the risks. The oligopoly is a price setter, either as a market leader, or as a silent collusion with its branch fellows. They succeed in pushing the total surplus value upwards.
Following Leninism, Baran and Sweezy also believe, that the state serves the monopoly capital. This is called stamokap (an abbreviation of state monopolistic capitalism). The authors believe that this term is less accurate, because the state is not a separate power factor. It is subjected to the class of managers2. The oligarchy of manager is continuously searching for possibilities to invest the surplus value in a profitable manner. However, due to the tendency of the surplus value to rise its absorption becomes more difficult.
Therefore Baran and sweezy expect, that the monopoly capital will finally end in a crisis. It fails. However, there are many ways to postpone this moment. For instance, additional consumptive demand can be generated by intensifying advertising. But according to the authors expenditures on advertising are not productive. This judgement also holds for various speculative financial services. They are worthless parasites.
Another part of the surplus value is absorbed by the taxes. It returns to the industries in the form of expenditures on defence, which provide for work for 9% of the professional population. According to the authors the military apparatus is aimed against a possible rebellion of its own population. Furthermore, the army is needed in order to surround the Soviet-Union, although that federation is peaceful. The rich elite tries to minimize the other expenditures in the public sector. The construction of roads is stimulated by the car-industry. The absorption of surplus value can also proceed by means of investments abroad, although there are boundaries. In this manner the domain of activity of the oligopolies becomes global. The oligopolies naturally bribe the various foreign governments. Nonetheless, the authors remain convinced of the inevitable coming of the crisis.
Racism is useful for the monopoly capital, because thus the black people become a reserve army of cheap labour forces. According to Baran and Sweezy the black people are a potentially revolutionary group. They complain about the formation of ghetto's. The authors do not restrict themselves to their economic analysis, but they supplement it with a philosophy of culture. In general life in monooly capitalism is superficial, empty and transitory. People feel alienated in their society. They suppress their emotions, by means of self-repression. The argument on p.344 suggests, that it makes women hysterical. In short, the whole system is irrational. The USA are in danger of collapsing due to insanity, whereas elsewhere in the world rebellion abounds. This story is a mixture of outdated marxism, and of the critical theory, which has been developed by the neomarxist School of Francfort.
Ten years ago your reviewer, although at the time quite naive and credulous, already believed that the statements of Baran and Sweezy are too far-fetched. Monopoly capital certainly contains many interesting facts. However, the authors try to force reality into the strait-jacket of their utopic dogma. It is an offence of the intelligence of the reader. Yet its simplicity can be attractive, for instance for young people, indignified by the injustice in the world. This demagogy irritates, without bounds3. For those who want to experience this feeling, Monopoly capital is a good choice.