In Postcapitalism, Paul Mason looks at the cycles of change experienced by capitalist economies. He argues that we are undergoing a fundamental change, driven by information technology. This change will see the limits of capitalism reached and something else emerge, which could be a better and more just world. It is a bold proposition. However, it appears that the main aim of this book is to show how Marxian economics has been saved by the IT revolution.
Mason looks at theories of business cycles, especially the so-called Kondratieff waves. Kondratieff was a Russian economist who proposed that capitalism goes through distinct cycles which include periods of crisis followed by adaptation to new circumstances with new innovation. Unfortunately, this idea did not sit well with those who ran Soviet Russia. Marx had outlined how capitalism was doomed. Any suggestion that capitalism was a dynamic system which could transform itself was therefore anathema. Kondratieff was eventually executed. But what if, somehow, both Marx and Kondratieff were right, or could be made to be? Mason argues the two can be reconciled and help explain current developments in the global economy.
Mason takes us through various developments in far-left economic thinking. One chapter asks ‘Is Marx right?’ but he gives the game away when he says ‘in order for Marx to be right … we have to make the theory both internally coherent and consistent with the evidence’. That sentence alone both outlines the purpose and concedes the flaw of this book. If Marx’s economic theory is incoherent and does not stand up to the evidence, why do we not try elsewhere? Moreover, Marx’s labour theory of value cannot be observed in real life, as the contortions required to solve the Transformation Problem – how we can relate surplus value to market prices – have long demonstrated. Yet Mason specifically avoids this debate, assuring us he is satisfied that the problem has finally been solved.
Mason argues that we are coming to the end of an extended economic wave, at which capitalism will erode because information technology is driving the cost of goods and services towards zero. The marginal cost of a downloaded music file is practically nil, apart from the energy required. Scarcity, the underlying assumption of most economics, will cease to exist as, ultimately, will money. He does concede it is possible that ‘a new form of cognitive capitalism does emerge and stabilise – based on a new mix of firms, markets and networked collaboration’, which seems more likely, but Mason argues we must design a transition to a ‘postcapitalism’ outcome.
This need to force the revolutionary pace is driven by the huge risks of climate change, demographic changes including migration, and a global elite tempted to become an oligarchy. Mason proposes a ‘Project Zero’, not a good name, which will see a basic income paid, monopolies ‘suppressed’ or nationalised, tax avoiding firms come ‘onshore’ or be treated ‘as the financial equivalent of Al-Qaeda…tracked down and suppressed’, collaborative ways of working encouraged and new ways of running things tried out locally before being applied on a larger scale.
Mason is right to say that the global economic system is in trouble. The risks he highlights towards the end of the book are very real indeed, especially climate change. Markets may respond, but probably too late unless there is state-led action. Mason does not mention the role of incentives in this book. They help explain the failures of communist systems and also why Wikipedia, which Mason highlights as representing the way of the future, is having to fight, hopefully successfully, to keep its model working effectively. Mason is too optimistic that a networked world will solve our problems. For example, already computer algorithms are directing people around warehouses like machines. Combating such new forms of labour exploitation will require some old-fashioned democratic government.
This book’s mission aims to show that, with the development of the internet, Marx is relevant after all. It is more post Das Kapital than post capitalism. That must be one reason why, for example, Keynes gets barely a mention. However we should not spend any effort trying to force the square peg of dehumanising and failed Marxism into the round hole of reality in order to think coherently about economic and social injustice. Mason instead should have looked more at imbalances of economic power and the strengths and weaknesses of human nature. There he may have found a more human, democratic, and progressive answer to the important challenges he highlights. He should have written about Tawney rather than Trotsky.
Stephen Beer is acting chief investment officer at the Central Finance Board of the Methodist Church and a former chair of Vauxhall CLP. He blogs at stephenbeer.com . This article represents his personal opinion.
Postcapitalism: A guide to our future
Allen Lane publishing | 368 pp | &11.89
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