You had to ask. The AI "thinks" that's a grand idea, lol. -------------------------------------------------------------
Yes. *Kalecki’s 1943 essay, “The Political Aspects of Full Employment,” provides precisely the conceptual bridge* that lets us reconcile Larry Summers’s secular stagnation thesis with the Monthly Review (Baran–Sweezy–Magdoff–Foster) theory of monopoly-capitalist stagnation. The key is that Kalecki explains why capitalist economies chronically lack sufficient demand , why private investment is unreliable , and why the capitalist class resists the policies that would permanently fix this problem. Those three elements map almost perfectly onto what Summers sees empirically and what Monthly Review explains structurally. Below is a structured reconciliation. *************************************************************** *1. Kalecki: Private investment is the weak link in capitalism* *************************************************************** In Kalecki’s model: * *Capitalist profits depend on capitalist investment.* * Investment depends on business confidence. * Therefore “the state of confidence” becomes a political weapon. In other words: *capitalism is inherently prone to demand shortfall because private investment is volatile, oligopolistic, and politically constrained.* This gives us a pivot: * *Summers* observes that private investment is chronically weak (“low natural rate”). * *Monthly Review* explains why private investment is structurally weak (monopoly, overaccumulation). * *Kalecki* shows why investment cannot be stabilized without changing political power relations. ****************************************************************************** *2. Kalecki explains why Summers’s fiscal solutions face political resistance* ****************************************************************************** Summers argues: * The cure for secular stagnation is *permanent fiscal expansion* : public investment, deficit spending, stronger redistribution, etc. Kalecki famously argues: > > > > Capitalists will oppose sustained full employment achieved through > government spending, even though it raises profits. > > Why? * It undermines the “discipline of unemployment.” * It reduces business control over economic policy. * It sets a precedent for a powerful state sector (“creeping socialism” in their view). This exactly anticipates why: * *Summers’s policy prescriptions (fiscal stimulus, higher inflation targets, public investment)* are politically blocked. * *Monthly Review* says stagnation persists because capitalist classes structurally resist measures that would cure it. Kalecki explains why Summers’s macroeconomic “fix” is systemically frustrated — because it conflicts with capitalist class interests. ********************************************************************************************** *3. Kalecki connects Summers’s demand shortfall to the MR school’s surplus-absorption problem* ********************************************************************************************** Summers: * Excess saving → insufficient investment → low natural rate. Monthly Review: * Monopoly capitalism generates excess surplus that cannot be profitably reinvested. Kalecki: * Profits depend on investment, but investment depends on capitalists’ expectations and power. Here is the reconciliation: * *Summers identifies a chronic macro imbalance* (excess saving, weak investment). * *Monthly Review identifies the structural reason* (monopoly capitalism produces a surplus that cannot be absorbed through productive investment). * *Kalecki provides the political logic preventing public policy from compensating for this gap*. Thus: *Summers = symptom. MR = structural cause. Kalecki = political mechanism enforcing the cause and perpetuating the symptom.* All three describe the same phenomenon at different levels. *************************************************************************************************** *4. Kalecki shows why capitalism turns to financialization—explaining what Summers sees as bubbles* *************************************************************************************************** Summers famously says: > > > > We only reached full employment in the 1990s and 2000s via unsustainable > asset bubbles. > > Monthly Review argues: > > > > Financialization is a structural response to surplus absorption problems. > > Kalecki’s framework predicts this too: * When private investment is insufficient and government action is politically blocked, * Capitalism turns to *destabilizing, speculative, and politically harmless outlets* for surplus and demand. Kalecki didn’t foresee modern derivatives, but he absolutely foresaw the logic: > > > > If government employment policy is blocked, the economy will rely on > “stimulating private investment”—including through instability. > > So: * Summers: “We needed bubbles to maintain demand.” * MR: “Bubbles are a structural mechanism of monopoly-finance capital.” * Kalecki: “Bubbles arise when business vetoes the public policies that could maintain full employment.” This makes all three positions consistent. ************************************************************************************ *5. Kalecki integrates Summers’s macro diagnosis with MR’s theory of monopoly power* ************************************************************************************ Monthly Review emphasizes that monopoly power suppresses investment by reducing competitive pressure. Kalecki wrote in Theory of Economic Dynamics and other work that: * *Oligopoly leads to retained profits that suppress investment* (because expected profits don’t justify additional capacity expansion). * Investment becomes political and strategic, not just economic. Thus Kalecki already provides the “missing middle” between Summers’s empirical observations and MR’s structural theory: *Summers* : Investment is weak → low natural rate. -------------------------------------------------- *Kalecki* : Investment is controlled by oligopolists concerned with power, not just profit maximization. -------------------------------------------------------------------------------------------------------- *MR* : Monopoly capitalism structurally creates too much surplus and too few outlets → stagnation. -------------------------------------------------------------------------------------------------- Put together: *Oligopoly → underinvestment → stagnation → fiscal policy needed → capitalists block fiscal cures → stagnation becomes permanent.* That is the complete synthesis. ********************************************* *6. Complete Reconciliation in One Paragraph* ********************************************* Summers identifies the empirical macroeconomic symptom of secular stagnation: too much saving, too little investment, and a natural interest rate below zero. Monthly Review identifies the structural cause: monopoly capitalism generates an excess surplus that cannot be absorbed through productive investment, leading to chronic stagnation and financialization. Kalecki shows the political mechanism behind this: capitalists oppose the sustained public spending that could maintain full employment because it weakens their power and undermines the “discipline of unemployment.” Taken together, Kalecki’s political theory explains why Summers’s proposed cures are not implemented and why the Monthly Review school’s stagnation tendency persists. -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#39294): https://groups.io/g/marxmail/message/39294 Mute This Topic: https://groups.io/mt/116301050/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. #4 Do not exceed five posts a day. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/13617172/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
