Keynesianism, Monetarism and the Crisis of the State

by Simon Clarke

First published in 1988, this book has acquired new relevance in the wake of the global financial crisis. This important book focuses on the fundamental theoretical and political issue of the relationship between money and the state raised by the crisis of Keynesianism and the rise of monetarism. Simon Clarke starts with the classical political economists' analysis of the state based on their view of money as the only acceptable form of capitalist regulation. He then draws on Marx’s critique of the classical theory of money to develop an analysis of the tendency to the overaccumulation of capital, which underlies the permanence of class struggle and monetary disturbances. He then analyses the liberal form of the capitalist state, which determines the manner in which crises appear politically and ideologically at the level of the state, and whose contradictory form defines the nature and limits of state intervention. This argument is developed through an historical analysis of the rise of the modern state, leading to an original account of the crisis of Keynesianism and the rise of monetarism. The conclusion outlines the implications of the analysis, highlighting the limits of monetarism, the crisis of social democracy and the future of socialism.
The book makes a major original contribution to contemporary academic and political debate.

'Keynesianism, Monetarism and the Crisis of the State is well and
clearly written. It makes a significant contribution and is particularly
useful as an historical account of monetary policy in relation to
various economic theories'
Tom Bottomore, Emeritus Professor of Sociology, University of Sussex
'Simon Clarke's penetrating analysis strips off the ideological masks of contemporary capitalism, to show the continuing relevance of a Marxist historical approach to understanding the political and economic crisis of capitalism, and to establish the urgent necessity or a socialist and internationalist solution'
Peter Guttkind, Former Professor of Sociology, McGill University, Canada
'A very coherent and well-argued book which provides powerful
criticism of current writing on the state and the theory crisis, and
offers a compelling new perspective'
Andrew Gamble, Professor of Politics, University of Sheffield.

Genres: Economics

384 pages

First published January 1, 1988

About the author

Simon Clarke is a British sociologist specialising in social theory, political economy, labour relations, and the history of sociology. He has a particular interest in employment relations in China, Vietnam, and the former-Soviet nations. He is Professor Emeritus of Sociology at the University of Warwick.

Reviews

[Jacob Joshy · Rating 4 out of 5]

In this seminal text, Simon Clarke offers a meticulous and comprehensive survey of capitalist development from the onset of mercantilism to the monetarism of the late twentieth century.

Through the lens of crisis and accumulation, Clarke presents a solid Marxist analysis of the development of social welfare states, global geopolitical dynamics, the rise of Keynesianism as a response to the crisis, its ultimate demise and the dominance of monetarism. He traces the gradual separation of polity and economy throughout the last two centuries, which led to the subordination of the state and society under the command of the market power.

The central thesis Clarke puts forward is that the present crisis can be identified as the crisis of socialism, a pressing issue that demands our immediate attention. He concludes with a revived call for socialism as the paramount goal, emphasising that this is not a mere policy and programme formulation nor an opportunistic struggle for state power but a democratic and international movement grounded within an inclusive and robust working-class movement.

Although rooted in the British policy experience during the nineteenth and twentieth centuries, Clarke's book provides an excellent way to understand the contradictory tendencies inherent within capitalism as a system that constantly ushers to the pauperisation of the growing masses, wars, and recurrent crises. Hence, he argues that the remedy can only be achieved by bringing social production under social control.

[Brecht Rogissart · Rating 5 out of 5]

This book is - in typtical Clarke style - not really about the historical period of Keynesianism, the crisis of the '70s, and monetarism. He starts in the 18th century, and outlines his theory of the role of the capitalist state in relation to "civil society" (the market) in a historical argument. He goes through 19th and early 20th century histories of the capitalist state through a view on British politics. Only in the eleventh chapter (having the same name as the title of the book) does he actually delve into the breakdown of Keynesianism, and its alternatives.

Selecting Britain as the historical case study is possibly misleading - as the 19th century hegemon it had a profoundly different domestic and foreign economic and class structure, which lingered on throughout the 20th - but he's excellent in locating Britain within the global economy, how it drips through in domestic affairs, and allows him to make meaningfull comparisons with France, Germany, US,... along the way. Still, focus is on Britain, and it limits the insights of this book for other historical contexts.

What I like about Clarke is a good balance between empirics and theory. He is well-read in Marxist theories and methods, but refuses to fall back on platitudes/classic theoretical blueprints. Theory must meaningfully agglomerate and make sense of the broad movements. But he does it in a quite classical Marxist vocabulary. It allows him to make sharp observations on the role of the capitalist state, from which I've learned much. Some other aspects, for example his crisis theory of 'overaccumulation in a capitalist global market defined by uneven and combined development' does seem to work and is at points very helpful in seeing causality in international economics, but it should have been a seperate book where he carefully exposes every aspect of the theory. In this book it is often used, but eventually underdeveloped to really clarify what was going on.

The ultimate conclusion of Clarke is that the only alternative for the unfolding neoliberal discipline is democratic, international socialism. It is the only - rather cynic - conclusion one can draw from his analysis: capitalist accumulation will always push back the collective aspirations of the working class, the capitalist state will always have to comply to the boundaries of the market. Even though I refuse to agree with this cynic conclusion (it's really in the Bartellian "TI1A: socialism" pipeline), it is still unbelievable that Clarke wrote this analysis of monetarism already in 1988. He is so much ahead of many of the studies of neoliberalism. For example his emphasis that the neoliberal turn was *forced* by the crisis of the '70s, which was a global capitalist crisis, and that it was not at all an ideological battle, but a pragmatic policy compulsed by the global market... He already said it in 1988!

[loitering outside 711 · Rating 4 out of 5]

Brilliant beautiful analysis,
Sources? “Bro just trust me”