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Against the Market: Political Economy, Market Socialism and the Marxist Critique
In this innovative book, David McNally develops a powerful critique of market socialism, by tracing it back to its roots in early political economy. He ranges from Adam Smith’s attempt to reconcile moral philosophy with market economics to Malthus’s reformulation of Smith’s political economy which made it possible to justify poverty as a moral necessity. Smith’s economic theory was also the source of an attempt to construct a critique of capitalism derived from his conception of free and equal exchange governed by natural price. This Smithian forerunner of today’s market socialism sought to reform the market without abolishing the social relations on which it was based. McNally explores this tradition sympathetically, but exposes its fatal flaws.
The book concludes with an incisive consideration of efforts by writers such as Alec Nove to construct a “feasible” model of market socialism. McNally shows these efforts are still plagued by the failure of early Smithian socialism to come to grips with the social foundations of the market, the commodification of labor-power which is the key to market regulation of the economy. The results, he argues, are neither socialist nor workable.
The book concludes with an incisive consideration of efforts by writers such as Alec Nove to construct a “feasible” model of market socialism. McNally shows these efforts are still plagued by the failure of early Smithian socialism to come to grips with the social foundations of the market, the commodification of labor-power which is the key to market regulation of the economy. The results, he argues, are neither socialist nor workable.
276 pages, Paperback
First published December 17, 1993
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About the author
David McNally
9 books23 followersDavid McNally is the Cullen Distinguished Professor of History and Business at the University of Houston and director of the Center for the Study of Capitalism. McNally is the author of seven books and has won a number of awards, including the Paul Sweezy Award from the American Sociological Associaton for his book Global Slump and the Deutscher Memorial Award for Monsters of the Market.
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Displaying 1 - 4 of 4 reviews
October 1, 2014
David McNally's analysis of the market form proceeds in different parts, first drawing out the historical development of market capitalism in England. In McNally's reading the key thing about the development of the free market was above all the creation of the free market in labor, echoing the chapter on primitive accumulation in Marx's Capital, but also pointing to the enactment of the Poor Laws, the removal of protections for apprenticeships etc which removed all recourse the working classes of English society had other than selling their own labor. In the second and third chapters he records how these developments were codified and naturalized into the ideology of political economy by Adam Smith and Thomas Malthus. If Smith's attempt to make national wealth, including that of the working class, consistent with the principles of the free market was inconsistent in a way that could give some inspiration to early working-class socialists, Malthus was a thoroughly execrable ideologist of the bourgeoisie, whose incredibly inconsistent and at times bizarre claims served to justify the elimination of all rights of subsistence, giving the ruling class an "ethical" reason for starving the poor.
In the next chapter, McNally reveals how Malthusian political economy was subject to a great amount of contestation by the early working-class and socialist movement in England. Starting with the factory owner Robert Owen, he dissects the work of a range of working-class activists who through a series of successive approximations came to understand the limitations of the market. Nevertheless, what all of these utopian socialists ultimately missed was a coherent theory of the free market's embedenness in a system that enslaved the workers and the poor. Committed to a view that saw monopolies and the interference of the state hindering the operation of the market as the source of class warfare and inequality, they all tended toward the reactionary view of an ideal society as a commonwealth of independent producers who could freely exchange their goods to realize needs. Rather than exploitation happening within the process of production as Marx would later reveal, they saw it as a result of unequal exchange happening in the realm of circulation. The faults of this view were shown in Owen's labor-credit system, and by later attempts to simply abolish money and replace it with a currency that would somehow mystically grant each producer the value of his or her labor.
The height of these petty-bourgeois socialisms was shown in the work of Proudhon, who to this day exercises a bizarre influence on some anarchist circles in the developed world. McNally traces Marx's critique of Proudhon and his followers from his famous polemic "The Poverty of Philosophy" to less-known engagements in the Gundrisse and Capital. In Marx's elegant critique, Proudhon's views were emblematic of petty-bourgeois socialism in that he saw the establishment of mutual banks for producers as the solution to social conflict. Proudhon's central error, similar to that of all early socialists, was to see the market as a place where human wants could be realized if a few things were tampered with. Most of all he failed to see the market for labor as the source of the capital relationship, dissolving the dialectics of capitalist society into "good aspects" and "bad aspects." He failed to recognize the identity of the market with the ruling-class order, and this led him to oppose attempts to organize labor and take a counterrevolutionary stance in 1848.
McNally's last chapter, "Beyond the Market," is the cornerstone of the book in that it thoroughly engages with and refutes the claims of the market socialists of the present era. He emphasizes the identity of the free market, most of all the market in human labor-power, as the source of capitalism in today's world. Though he acknowledges that markets in some commodities may exist after the destruction of capitalism as they did before its birth, he demonstrates concretely how markets are a mechanism for reproducing inequality and crisis in the form of the capitalist relationship, and would have to be deliberately driven to the margins of society under a truly democratic socialist regime. In his excellet account of the incompatibility of the market with socialism, he both refutes the ideological claims of von Mises and Hayek and their curious influence on some socialists, and draws out a concrete and inspiring model of how a democratic regime of socialist planning might work in the future.
"Against the Market," only the second of McNally's prodigious output, was published in the early 1990s after the collapse of the Soviet bloc, when many leftist intellectuals under the pressure of this perceived defeat were embracing various models of "market socialism," which they proposed could avoid the supposed irrationalities of a planned economy, using the market as a tool to ensure socialist well being. Though most of these intellectuals ended up abandoning socialism instead of abandoning the market, McNally's critique is in a sense more needed now than ever, especially after the effects of the market on "communist China" have become known, and which Marxian dependency theorist Giovanni Arrighi tried to paint as the future base of a market but non-capitalist world order. I can't recommend it highly enough.
In the next chapter, McNally reveals how Malthusian political economy was subject to a great amount of contestation by the early working-class and socialist movement in England. Starting with the factory owner Robert Owen, he dissects the work of a range of working-class activists who through a series of successive approximations came to understand the limitations of the market. Nevertheless, what all of these utopian socialists ultimately missed was a coherent theory of the free market's embedenness in a system that enslaved the workers and the poor. Committed to a view that saw monopolies and the interference of the state hindering the operation of the market as the source of class warfare and inequality, they all tended toward the reactionary view of an ideal society as a commonwealth of independent producers who could freely exchange their goods to realize needs. Rather than exploitation happening within the process of production as Marx would later reveal, they saw it as a result of unequal exchange happening in the realm of circulation. The faults of this view were shown in Owen's labor-credit system, and by later attempts to simply abolish money and replace it with a currency that would somehow mystically grant each producer the value of his or her labor.
The height of these petty-bourgeois socialisms was shown in the work of Proudhon, who to this day exercises a bizarre influence on some anarchist circles in the developed world. McNally traces Marx's critique of Proudhon and his followers from his famous polemic "The Poverty of Philosophy" to less-known engagements in the Gundrisse and Capital. In Marx's elegant critique, Proudhon's views were emblematic of petty-bourgeois socialism in that he saw the establishment of mutual banks for producers as the solution to social conflict. Proudhon's central error, similar to that of all early socialists, was to see the market as a place where human wants could be realized if a few things were tampered with. Most of all he failed to see the market for labor as the source of the capital relationship, dissolving the dialectics of capitalist society into "good aspects" and "bad aspects." He failed to recognize the identity of the market with the ruling-class order, and this led him to oppose attempts to organize labor and take a counterrevolutionary stance in 1848.
McNally's last chapter, "Beyond the Market," is the cornerstone of the book in that it thoroughly engages with and refutes the claims of the market socialists of the present era. He emphasizes the identity of the free market, most of all the market in human labor-power, as the source of capitalism in today's world. Though he acknowledges that markets in some commodities may exist after the destruction of capitalism as they did before its birth, he demonstrates concretely how markets are a mechanism for reproducing inequality and crisis in the form of the capitalist relationship, and would have to be deliberately driven to the margins of society under a truly democratic socialist regime. In his excellet account of the incompatibility of the market with socialism, he both refutes the ideological claims of von Mises and Hayek and their curious influence on some socialists, and draws out a concrete and inspiring model of how a democratic regime of socialist planning might work in the future.
"Against the Market," only the second of McNally's prodigious output, was published in the early 1990s after the collapse of the Soviet bloc, when many leftist intellectuals under the pressure of this perceived defeat were embracing various models of "market socialism," which they proposed could avoid the supposed irrationalities of a planned economy, using the market as a tool to ensure socialist well being. Though most of these intellectuals ended up abandoning socialism instead of abandoning the market, McNally's critique is in a sense more needed now than ever, especially after the effects of the market on "communist China" have become known, and which Marxian dependency theorist Giovanni Arrighi tried to paint as the future base of a market but non-capitalist world order. I can't recommend it highly enough.
March 5, 2023
Really thorough and necessary. The bulk of the book is an intellectual history of the theories of the capitalist market, which is always the labor market. McNally really brings out the theoretical cannons in the final chapter. Any socialism that claims to be democratic (the essence of socialism) must take direct aim at the market. There is no way around it.
As a side note, I feel like our contemporary movement has all but lost sight of the market as central to Marx’s whole critique. This book is an excellent resource in recovering that, and contributing to a regeneration of applied Marxist theory. It should be read widely among leftists.
“The key to the capitalist economy, therefore, is the market in human labour-power. And this insight, systematically pursued, explodes the entire fetishistic universe of classical political economy and renders nonsensical all notions of ‘market socialism.’” (174)
As a side note, I feel like our contemporary movement has all but lost sight of the market as central to Marx’s whole critique. This book is an excellent resource in recovering that, and contributing to a regeneration of applied Marxist theory. It should be read widely among leftists.
September 22, 2020
I finished this book two weeks ago and I hadn’t had the time to write a review until now. It is a well-rounded description of the economic situation in Britain immediately after feudalism ended followed by a bit of history on the creation of working-class radicalism, its co-option of political economy and ultimate failure to bring about a coherent socialist ideology. All this background is useful to deal with contemporary strains of socialism which have decided to incorporate market mechanisms into their theories and, in doing so, have abandoned any semblance of socialism.
This book is very useful to understand Marx more deeply, but it doesn’t broach a discussion on the role of the state (even if this is transitional). All in all, a very well-written book that at times is repetitive but immensely rewarding.
This book is very useful to understand Marx more deeply, but it doesn’t broach a discussion on the role of the state (even if this is transitional). All in all, a very well-written book that at times is repetitive but immensely rewarding.
June 19, 2018
Good readable history of primitive accumulation in Britain and the parallel political economy. Well rounded critique of market socialism.
Displaying 1 - 4 of 4 reviews