Marx vs. Keynes

One major symptom of the current weakness of the left is the total marginality of genuinely left-wing economic theory. The economic crisis has done much to discredit the forms of neoclassical economics that have recently been dominant among Western academics and policy-makers. But in searching for alternatives, activists, intellectuals, journalists and bloggers alike are unlikely to turn to Marxist or other left analyses. Instead, they engage with fringe right-wing doctrines like Austrian economics, or else they seek the counsel of what on Wall Street are known as “permabears“: figures like the suddenly famous Nouriel Roubini, whose perpetual predictions of doom appear vindicated during any downswing of the economic cycle. Meanwhile, the absolute leftmost outpost of respectable opinion these days is occupied by Dean Baker–a brilliant, iconoclastic, and politically praiseworthy social democratic economist, but hardly a radical.

Now, however, the renowned Marxist geographer David Harvey has come forth on the web to present his critique of the economic stimulus package, and of mainstream economics more generally. Even more interesting, Harvey’s piece provoked a response from one of the more prominent economics bloggers, Berkeley professor and former Clinton administration official Brad DeLong.

DeLong has an odd relationship with radical economic theory. He is politically a middle-of-the-road Democrat, and theoretically a mainstream, neoclassical economist. But whereas most mainstream economists these days are content to simply ignore Marx, DeLong seems to have an almost pathological need to attack Marxists; see for example his reaction to the death of Paul Sweezy. Perhaps the spectre of Marx provokes some deep-seated fear in DeLong, a worry that the assumptions underpinning his intellectual project may turn out to be flawed. And maybe he’s right to worry–his neoliberalism now looks pretty obviously like a failed model. That could lead impressionable minds to turn away from the hegemonic forms of economics, in search of critical perspectives that have something to say about the crisis in which we find ourselves.

In any event, I encourage everyone to have a look at the debate:

• Harvey I
• DeLong I
• Harvey II
• DeLong II

The two principals lay out the issues better than I can, but my quick reaction is that Harvey is basically right about the larger issues at play. DeLong scores points insofar as he attacks Harvey for being a catastrophist–that is, saying that the stimulus can’t work, rather than that it may not work. Predicting economic catastrophe has a long and not particularly distinguished record on the left, and I don’t think anyone should count out the system’s ability to heal itself at the expense of the working class. But even here, it seems to me that DeLong is picking at semantics (when he’s not insulting Harvey for not having read the right neoclassical theorists). As a commenter at DeLong’s site points out, a lot of the differences between these two thinkers arise from the fact that they are operating at totally different temporal scales: DeLong is trying to figure out what may happen in the next year, while Harvey is thinking about the trajectory of the U.S. over the coming decades. In addition, DeLong is hung up on the purely technical analysis of economic mechanisms, while Harvey is trying to come up with an understanding that synthesizes social, political and economic factors–a reading of what the historians of the Annales school called the conjuncture.

Leaving aside the substantive issues at play, I also recommend a look at the comments sections of DeLong’s posts–you’ll see him jumping into the fray, adding his editorial comments to rebut each person who attempts to defend Harvey’s points. This is not how he usually treats discussion on his blog, and it suggests he’s more troubled by Harvey than would seem warranted, given DeLong’s far greater status both in academia and in the media.

This is probably not the last dustup of this sort. For the immediate future, I’m bullish on a bit of a resurgence in Marxist theory, and bearish on the prospects of creaky neoclassicals like DeLong.