Mr. Ip and the Wall Street Journal Discover Wealth Inequality

It was in 2013 that Thomas Piketty rediscovered the problem of wealth inequality with his celebrated book Capital in the Twenty-first Century. Published by Harvard University Press and selling several million copies, the book turned prevailing mainstream economic thinking on its head. Academic economists and capitalist apologists had long assured us that capitalism persistently created wealth and distributed it fairly to all the factors of production, with deviations from this fair distribution attributable to unusual or exceptional intervention in the process.

But Piketty’s look at all the available, relevant data showed just the opposite: capitalism-- absent any external or exceptional circumstances-- invariably generated growing inequality. Using sources dating to the eighteenth century, Piketty showed that, with the exception of the destruction of capital or the rare active measures to redistribute it, wealth inequality was bound to grow. Piketty offered no deep explanation of why this is a feature of capitalism, but he did offer the usual social democratic panacea-- tax the rich!

Coming only four years after the steepest economic downturn since the Great Depression, Piketty’s opus was well received by a wide audience. As a consequence, one might think that the idea of overthrowing the system responsible for more than two centuries of growing inequality would accordingly enter the popular conversation.

But it was not to be. Though a new gilded age of conspicuous consumption, new manifestations of privilege, and raging demand for luxury emerged, no serious threat to the capitalist system sprung forth. Anger was contained effectively in the US by a rotten, corrupt two-party system. Fear and a deeply ingrained hostility to socialism gripped older generations. And younger people-- facing a desperate future-- were open to an alternative to capitalism, but saw no clear road for it.

Now, thirteen years later, The Wall Street Journal’s top economic commentator, Greg Ip, has again rediscovered inequality. He writes about today’s economy:

Its rewards are going disproportionately toward capital instead of labor. Profits have soared since the pandemic, and the market value attached to those profits even more. The result: Capital, which includes businesses, shareholders and superstar employees, is triumphant, while the average worker ekes out marginal gains.

The divergence between capital and labor helps explain the disconnect between a buoyant economy and pessimistic households. It will also play an outsize role in where the economy goes from here.

The brute financial force of all that wealth means market fluctuations, like last week’s, matter more for consumer spending. Meanwhile, artificial intelligence could funnel even more of economic output toward capital instead of labor. Last week may be a taste. Amid reports that layoffs are climbing and job openings plunging, especially for professionals exposed to AI, the Dow Jones Industrial Average closed above 50000 for the first time…

The shift to capital from labor has actually been under way for more than 40 years. Labor received 58% of the total proceeds of economic output, as measured by gross domestic income (conceptually similar to GDP), in 1980. By the third quarter of last year that had plummeted to 51.4%. Profits’ share, meanwhile, rose from 7% to 11.7%.

Ip’s charts show that S&P 500 profit margins have doubled over the last 15 years, with corporate profits rising 43% since the end of 2019.

Where Ip tells us that this is an alarming trend over the last 40 years, Piketty tells us that growth in inequality is the long-term trajectory of the capitalist economy. Both are right.

What is disconcerting is that the victims of this trend, the vast mass of working people, have no voice, no representation, no program to address this inevitable-- if we are to believe Piketty-- consequence of a capitalist system.

What is even more disconcerting is that voices on the left that purport to advocate for working people offer such unimaginative, weak alternatives.

Now Ip only raises the specter of growing inequality to alert ruling circles of the danger that the masses will sharpen their pitchforks and rebel against the privileges of capital. Piketty proposes redistributing wealth through mechanisms-- like taxation-- that the system controls with its most loyal agents. The idea that bourgeois political parties will substantially tax the bourgeoisie is truly fantastic. 

Unions-- one of the few remaining mass organizations supporting workers-- offer a poor record of staunching the flow of wealth to capital, even in industries where unions are well represented and strong. And union leaders seldom have any vision beyond that offered by center-left parties. 

Sadly, too many of the left’s public intellectuals are mired in side shows: cooperatives as an answer to international monopolies, romanticizing the capitalist order existing before Thatcher and Reagan, or cheering on an abstract “global south” bringing capitalism to its knees. 

Others paint a dire picture of wealth being cannibalized by a cabal of rentiers, scorning the Marxist theory of bourgeois and exploited proletariat. This novelty finds currency in the fashionable, but deeply incoherent idea of “technofeudalism.”

Missing from these distractive theories is any understanding of capitalism’s fundamental logic: the contradiction between workers and capital. Oddly enough, a capitalist apologist, a conservative writer, Greg Ip, understands this contradiction all too well in his observations about growing inequality, as does Piketty in his writings. 

For many of those offering their thoughts to working people, the working class is inconsequential or decimated by deindustrialization in their relatively small part of the world (typically, English speaking or Eurocentric). As a result, they spin arcane theories of inequality or oppressions. They overlook the reality that there are over a billion and a half workers in Asia alone, most of whom are working under conditions of capitalist exploitation as described by Karl Marx and Frederick Engels. They have forgotten that while industry has shifted globally, while there is a constant change in the global division of labor, the material wealth is still created by working people. 

The mobility of production and the division of labor are permanent features of capitalism that have only accelerated in recent decades. New technologies and industries have sprung up, where older technologies and industries migrated to areas of cheaper labor. A country like the United States is hollowing out, with a diminishing manufacturing sector, but a high-value, high-income technology sector at one level and a precarious, lower-income service sector at another level. Workers at all levels in all countries where capital employs labor are exploited by capital. 

The lengths to which so many supposed leftists go to ignore or deny the fundamental relationship between workers and capitalists-- the ultimate cause of growing inequalities-- is startling. The dawn of the industrial age gave new meaning to the word “exploitation.” Marx and Engels refined that meaning, giving it a rigorous role at the center of their analysis. And it remains essential to our understanding of the world today.  

Workers are exploited.

Reformers seek to blunt exploitation’s sting.

Revolutionaries act to eliminate it.

Greg Godels

zzsblogml@gmail.com

Obscene Wealth

Gabriel Zucman is a French-born economist who teaches at California, Berkeley and the Paris School of Economics. Zucman’s academic specialization is in wealth inequality, using tax data to track the stratification in wealth in the US and the rest of the world. A student of famed inequality expert, Thomas Piketty, he is an important figure in the World Inequality Database.

His most recent findings expose a gross obscenity, a level of wealth inequality in the US that should shame every politician, every mainstream-media commentator, and every cultural influencer who fails to make recognition of this travesty central to his or her message. 

Discussed in some detail in an article by Juliet Chung, appearing in the Thursday, April 24 Wall Street Journal, Zucman’s most recent findings draw little attention from the other corporate media. 

Zucman claims that the wealth of 19 households in the US grew by one trillion dollars in 2024, more than the GDP of Switzerland. That top 0.00001% of households accounted in 2024 for 1.81% of all the wealth accumulated in the US-- nearly 2% of all US wealth is held by those 19 households.

Other conclusions drawn from the WSJ article:

● Total US wealth in 2024 was $148 trillion.

● The share of total US wealth held by the 0.00001% of households was, by far, the greatest since 1913, when the US income tax system originated.

● JP Morgan Chase estimates that there were 2,000 billionaires in the US in 2024; 975 in 2021.

● The top 0.1% of households constitute approximately 133,000 households and each holds an average of $46.3 million in wealth, accumulating $3.4 million a year since 1990 (Steven Frazzari, Washington University, St. Louis).

● The next 0.9% of households-- approximately 1.2 million households-- were each worth $11.2 million and grew by $450,000 per year in the same period (Frazzari).

● The cumulative 1% of households account for 34.8% of total US wealth in 2023.

● In capitalist counterpart countries, the 1% account for 21.3% of the total wealth in the British Isles, 27.2% in France, and 27.6% in Germany (2023).

● The top 10% of US households hold 67% of all the wealth in the US.

● The top half of US households have secured 97% of all US wealth.

● CONSEQUENTLY, THE OTHER HALF OF US HOUSEHOLDS (~ 66 MILLION HOUSEHOLDS, ~166 MILLION CITIZENS) SHARED ONLY 3% OF ALL THE WEALTH ACCUMULATED IN THE US.

These data underscore the fact that the US is a radically unequal society, with wealth concentration increasing dramatically as one ascends the class ladder.

What conclusions can we draw from the Zucman/Wall Street Journal report?

First, it is important to distinguish wealth inequality from income inequality. 

Income inequality is a snapshot of the remuneration that an individual or household might receive in a given period. For example, a sports figure or a celebrity might receive a huge compensation package for two or three years of success, but otherwise fall dramatically in income and end with modest wealth.

Wealth on the other hand, is inheritable and cumulative. In a capitalist society, it is possible to have income without accumulating wealth, but it is almost impossible to have wealth without effortlessly gaining income. 

Among the employed, income is always contingent. Wealth, to the contrary, is owned and can only be alienated by legal action.

While income is empowering, accumulated wealth imbues its owner with both security and degrees of power and influence proportionate to its quantity.

Thus, wealth is a better measure of personal or household economic status than income.

For those academics and media pundits who prattle on about “our democracy,” it must be pointed out that over half of the US population is effectively economically disenfranchised from the political system. With so little accumulated wealth (3% of the total wealth), they cannot participate meaningfully in an electoral system driven by money. They lack the means to contend for office, as well as to affect the choice of candidates or the outcomes. 

Even if the bottom half of households were to pool their resources, they could not match the financial assets readily available to the top 1% in order to dominate political power. 

Cold War intellectuals constantly heralded the formal democracy-- the rights to participate in electoral politics-- enjoyed by citizens in the advanced capitalist countries. They assiduously avoided mentioning citizens’ actual means to participate in any meaningful way, influenced by the vast and telling inequalities in those means. Clearly, the bottom half of all US households have little means of engagement with politics, apart from casting an occasional vote for limited options, for which they have little say in determining. 

Further, the next 40% of households have between them, in diminishing amounts as they approach the bottom half, just 30% of US wealth to express their political prerogatives. No doubt that provides the false sense of political empowerment that the two bourgeois parties prey upon.

The victory of form-over-substance in the legitimation of US social and political institutions is surely threatened by the reality of wealth inequality-- a reality that empowers the wealthy over the rest.

The fact that the top 10% of US households have a grip on 67% of the wealth makes a mockery of “our democracy.” 

Talk of “oligarchs” or “the 1%” -- so popular with slippery politicians or internet naïfs -- actually masks the rot behind our grossly unequal society. Neither “evil” nor “greedy” people can explain the travesty recorded by the Zucman data. 

Instead, it is a system that produces and reproduces wealth inequality. While wars, economic crises, or the militant action of workers and their allies may temporarily slow or set back the march of wealth inequality under capitalism, the system continues to regenerate wealth inequality. That system is called “capitalism.”

As Paul Sweezy explained most clearly:

The essence of capitalism is the self-expansion of capital, which takes place through the production and capitalization of surplus value. Production of surplus value in turn is the function of the proletariat, i.e., the class of wage earners who own no means of production and can live only by the sale of their labor power. Since the proletariat produces for capital and not for the satisfaction of its own needs, it follows that capitalism, in Marx’s words, “establishes an accumulation of misery corresponding with accumulation of capital.” The Transition to Socialism, lecture, 1971

Economic historians like Piketty and Zucman who carefully track the trajectory of capitalism demonstrate empirically, again and again, that capitalist socio-economic relations give rise to economic inequality. 

While the distribution of wealth in advanced capitalist countries is not captured perfectly by the Marxist class distinctions, class-as-ownership-of-capital goes far to explain how wealth is distributed. 

With two-thirds of all wealth concentrated in the top 10% of households and an estimated 89% of all capital-as-stocks held by that same 10%, it seems reasonable to conclude that the capitalist class resides within the top 10% of wealthy households.

It should be just as clear that the bottom 50%-- with 3% of the wealth, and nearly all of that in personal real estate and other personal property-- survives on income from some form of compensation; its members work for a living. 

Thus, as one might anticipate from reading the 1848 Communist Manifesto, capitalist society today-- 177 years later-- remains substantially divided between those who create the wealth by working for a living and those who own the means of wealth creation and, therefore, gain most of their wealth from that ownership. Capital-- whether it coalesces as factories, banks, or other enterprises-- concentrates wealth at the top.

Between the bottom 50% and the top 10% of households is a contested field of largely income earners-- workers-- as well as professional, self-employed, and small business owners. While most are, strictly speaking, working class, many have illusions about their class status (“middle class”) or harbor the illusion that their class status will improve.

Some have been characterized as “aristocrats of labor” because of their relatively elevated possession of income or wealth among workers. Others are even better characterized-- to follow Marx-- as “petty-bourgeois”: small, insignificant capitalists.

From the classical texts through Louis Althusser and Nicos Poulantzas to Soviet analyst S. N. Nadel, Marxism has yet to produce a robust and rigorous theory of the upper-middle strata, though their members often prove to be the pivotal factor in denying social change. Accordingly, it is the segment most intensely courted by the centrist political parties.

If we are to remove the stain of wealth inequality, it must be its sufferers-- the working class-- who assume that task. And that task will only be decisively accomplished with the replacement of capitalism with socialism.

Greg Godels

zzsblogml@gmail.com

Why Class Matters

After the last election, Democratic Party functionaries were puzzled that voters-- usually attuned closely to the economy-- failed to show proper appreciation for the Biden economic miracle. They cited the billions in federal money flowing toward economic growth; they repeated aggregate growth figures more robust than other advanced economies; they showed that consumer spending continued to show surprising vigor; they noted that aggregate incomes grew faster than inflation; and they reminded us of the often-mentioned markers of rising stock market and housing values.

Baffled by the voters who shunned Bidenomics and complained about the economy, Democratic Party pundits are convinced that voters are simply ignorant of the facts.

Today, perhaps more than ever, the failure to recognize social-class divisions produces ill-informed, arrogant judgments like those prominent within Democratic Party circles. While aggregate numbers may tell one story, they fail to tell the story of the economic well-being of the classes and strata that make up the aggregate, even the by-far-largest segment of that aggregate. Could it be that Biden’s economic victory was a victory for the wealthiest, the most generously compensated among the US population, while leaving the majority of US citizens (and voters) in the rear-view mirror?

The answer is an unequivocal ‘yes.’

And the answer comes, not from a left-leaning think tank, but from Federal Reserve data by way of Moody’s Analytics and summarized in The Wall Street Journal.

As reported in the WSJ, the top 10% of “earners” -- those households reporting $250,000 in income or more-- are responsible for 49.7% of consumer spending. In other words, nearly half of all consumer spending is accounted for by those in the top 10% of all those reporting their incomes. This is the largest share for this elite segment since the Federal Reserve began tracking in 1989. In just three decades, the top 10%'s portion has increased from over a third to nearly half of all consumer spending.

According to the WSJ:

Taken together, well-off people have increased their spending far beyond inflation, while everyone else hasn’t. The bottom 80% of earners spent 25% more than they did four years earlier, barely outpacing price increases of 21% over that period. The top 10% spent 58% more…

Between September 2023 and September 2024, the high earners increased their spending by 12%. Spending by working-class and middle-class households, meanwhile, dropped over the same period.

Democratic Party consultant James Carville likes to say “it's the economy, stupid!” that decides US elections. If he is right, the celebration of Bidenomics was widely off the mark. During the Biden years, for 80% of US voters, their economy was stagnant, at best. In that light, the election results are far more understandable as reflective of pocketbook issues.

US economic growth is often portrayed by the major media as driven by household consumption (around two-thirds of gross US economic activity comes from household consumption). However, these reports are deceptive if they fail to acknowledge that nearly all of the consumption growth impacting GDP growth comes from the wealthiest 10% of the population. Arguably, so-called luxury spending is the driving force behind economic growth in the US in our time.

Thus, the widely heralded mantra of capitalist apologists that “a rising tide lifts all boats” has it backwards. In fact, the privileged 10% of all boats that rise constitute the tide.

Economy 101 preaches that working people spend nearly all that they make (or need to borrow more to make ends meet). That same conventional wisdom tells us that the rich reinvest or save most of their earnings. Both may be and are true, though inequality of income has grown so much that the richest 10% can save and reinvest while spending lavishly and conspicuously.

Since late 2021, the excess savings of the bottom 90% has dropped from about $1.1 trillion dollars to $300 billion at the end of 2024. In roughly the same period, the uppermost 10% has maintained an excess savings of about $1.3-1.4 trillion, according to Moody’s Analytics. Clearly, the bottom 90% was forced to draw down savings over the last four years in order to get by. It is important to notice that the concept of the “bottom 90%” masks the reality that each successive lower decile of household income below the top 10% has fewer means and lesser savings to meet a reasonably adequate standard of living. In short, the pain induced by a system maintaining such vast income inequality grows more acute as the level of income declines.

While not a proper class analysis of US society (not to be expected from official government statistics), the Federal Reserve data, as interpreted by Moody’s Analytics, provides a material basis for understanding the most recent US election.[i] As opposed to dire conclusions of a fascist mentality sweeping the country or wild celebrations of the revival of a mythical conservative past, the economic unraveling of the last period fed the electorate's profound thirst for change, any change.

In the wake of a deep economic collapse in the first decade of a new century-- a crisis unlike any seen for generations-- US voters turned, at that time, to a fresh-faced Democrat promising change. He won voters with his earnest, unbounded hope. He produced little change, but more of the same blindness to inequality.

Now, in the wake of the economic stagnation and hardship for the majority 90% struggling through the Biden years, another snake oil salesman returns, capturing one of the two decadent parties with another message of change-- Make America Great Again.

And again, voters act out of desperation.

Don’t blame the voters, blame the bankrupt two-party system and the economic system dominated by and for the rich and powerful.

Greg Godels
zzsblogml@gmail.com

[1] A proper economic class analysis will not evoke income or wealth-- simply contingent, quantified signifiers of inequality-- but qualitative indicators of socio-economic position or status. For Marxists, class is defined by an agent's function within a particular mode of production with regard to the economic relation of exploitation. Thus, under capitalism, class is a division between exploiters-- capitalists-- and the exploited-- workers. One class commands the means of production, the other class sells the former its labor power.

Of course, there are strata within and outside of the two classes: the haute and petit bourgeoisie, the ‘labor aristocracy,’ industrial workers, lumpen-proletariat, etc.

In general, income and wealth inequality are a result of class division and exploitation under capitalism and not its cause.

An Overdue Look at the Environmental Crisis

“When I use a word,’ Humpty Dumpty said in rather a scornful tone, ‘it means just what I choose it to mean — neither more nor less.’

’The question is,’ said Alice, ‘whether you can make words mean so many different things.’

’The question is,’ said Humpty Dumpty, ‘which is to be master — that’s all.”

― Lewis Carroll, Through the Looking Glass

Our global environmental crisis is widely understood to be reaching a crucial moment; the danger signals are flashing almost daily. Yet a certain complacency follows the many catastrophic climate events attributable to a critically injured environment. People talk easily of a climate Armageddon, while maintaining business as usual.

Is this fatalism? Are there onerous sacrifices necessary to save the planet? Are there insurmountable obstacles to finding solutions? Are we beyond the point-of-no-return? 

These questions need urgent answers.

The truth is that some leftists have been addressing these problems and ringing the alarm for decades. But some of us, though recognizing the crisis, have paid only lip-service to its solutions, neglecting to apply the unique perspective that Marxism could bring. Looking at the crisis through the lens of class and exploitation surely offers a deeper understanding than the sensationalism and superficiality of the capitalist media and their punditry.

Mea culpa.

Hopefully, my own absolution began with acquiring a copy of Monthly Review’s July-August issue devoted to perspectives on the environmental crisis from a left, Marxist-friendly perspective. Entitled Planned Degrowth: Ecosocialism and Sustainable Human Development (volume 75, number 3), the volume offers eleven contributions, with an important, essential, introductory essay by John Bellamy Foster. Foster has labored productively in the vineyards of ecosocialism for some time. The journal number comes highly recommended.

Much of the popular response to the unfolding environmental disaster is reducible to cultural environmentalism. Advocates call for a change in consumption patterns-- switching from products whose production, reproduction, or disposal is most harmful to our land, water, or air. Some cultural environmentalists demand a radical overall cut in consumption, insist on the elimination of conspicuous consumption, or even pose a philosophical challenge to the very concept of consumerism so prevalent in capitalist societies. 

But cultural environmentalism alone does not thoroughly address the institutions that encourage or incur needless carbon emissions, senseless waste, and the depletion of precious resources-- institutions like the military, the security, judicial, and penal system, the sales and marketing effort, mass entertainment, etc. Nor does it challenge capitalism itself.

On a global level, conserving only the twentieth-century resources allocated for war making, the social wealth lost to the destruction of past wars and necessitated by the remedial costs of death and suffering would put us uncountable years behind our current rendezvous with disaster. Even eliminating today’s bloated military budgets and stopping the current wars would lessen the immediate crisis dramatically. 

Most of the mainstream liberal and social democratic cultural environmentalists ignore these institutions that are deeply embedded in the capitalist infrastructure, instead opting for campaigns to eliminate or recycle the most energy-soaked articles of convenience-- cans, bottles, plastic bags, etc. or forcing the issue into the thick, impenetrable muck of bourgeois politics, legislative decision-making, and state regulation.

The Green New Deal, the consensus approach of the techno-environmentalists, promises to restructure capitalism by rewarding positive changes in energy generation and use, while sanctioning corporate foot dragging and avoidance. Implementation rests with the commitment of political puppets of corporate power-- the political strata. Again, there is no substantial challenge to capitalism and its institutions with techno-environmentalism.

The contributors to the Monthly Review anthology more or less understand the shortcomings of the liberal/social democratic approach. They grasp that capitalism-- with its insatiable thirst for accumulation-- cannot meet the challenge of environmental catastrophe. That reality animates all of the selections in Planned Degrowth. Yet, among the writers, there is little agreement on how to move beyond capitalism (of all the contributors, Ying Chen makes the strongest case for a robust, planned socialist economy genuinely independent of the capitalist mode of production).

Resolving those differences is made all the more difficult by the ambiguities and confusions accompanying the central concepts of planning and degrowth. 

It is commendable that nearly all of the participants understand that market forces alone are inadequate to extract humanity from the catastrophe awaiting us. Moreover, the alternative to markets necessarily is some form of economic planning-- some form of conscious human-based decision making. This alone is a departure from the left’s post-Soviet love-fest with market mechanisms and market socialism-- indeed, a welcome departure opening the way to a more robust socialism. But what form should the planning take? Who should make the plan?

Foster wisely sees the cause of environmental disaster in the capitalist’s insatiable need to “accumulate! accumulate!” -- borrowing Marx’s succinct summation. Accordingly, the challenge is to organize the economy around social usefulness, and not profit-- “focusing on use value rather than exchange value,” to employ Foster’s words.

Certainly, contrasting use value against exchange value, advantaging the former, requires some exiting from the market mechanism and a turn toward a different mechanism for the allocation of resources: conscious human decision-making, i.e. planning.

This makes a neat, compelling argument for some form of planning.

Unfortunately, most of the contributors have little regard for the rich twentieth-century experience in planning afforded by the now-defunct European socialist community. It is fashionable, among Western academic Marxists (or Marxians, as they sometimes like to be called), to heap scorn on the Soviet central planning mechanism in its different iterations despite its relative successes even without the benefit of today’s astounding computational powers. Apart from Paul Cockshott and some of his colleagues, there is little interest in exploring how a similar planning mechanism could be optimized using available technologies.

Foster, to his credit, offers a very modest defense of Soviet planning, especially regarding its impact on the environment. But others acknowledge the need for planning without providing even a sketch of how that would be done. 

Instead, several writers revisit the old New Left fetish of participatory democracy, as though the more fingers in the planning pie, the better, regardless of the results. This reaches the limits of absurdity with the Venezuelan rural commune proposed as the model for a planning mechanism to rescue the world economy from the throes of environmental crisis, a utopian fantasy.

The other Western Marxist obsession is decentralization. Apparently, the political model beloved by the North American-European left is the Swiss canton, the landsgemeinde, combining the smallest possible political units with the most direct democracy. How such decentralized planning could successfully redirect a modern juggernaut economy to escape the tyranny of markets requires a giant leap of faith (As Nicolas Graham understates, “... it is quite difficult to imagine effective planning… without some coordinating authority and external arbiter.”) 

Planned Degrowth’s other key idea, degrowth, is also underdeveloped. Informing this concept is the looming disaster cited by Foster and implicit with all of the authors: 

The world scientific consensus, as represented by the UN Intergovernmental Panel on Climate Change (IPCC) has established that the global average temperature needs to be kept below a 1.5-degree Centigrade increase over pre-industrial levels this century-- or else, with a disproportionately higher level of risk, “well below” a 2-degree Centigrade increase-- if climate destabilization is not to threaten absolute catastrophe… All of this is predicated on reaching net zero (in fact, real zero) carbon emissions by 2050, which gives a fifty-fifty chance that the climate-temperature boundary will not be exceeded.

Understandably, faced with these limits, most of us recognize that, in some sense or another, we cannot have our cake and eat it, too. That is, growing carbon emissions, growing consumption patterns, more broadly-- growing GDP as support for growing consumption or growing population, and any and all other forms of growth that potentially increase carbon emissions cannot be simultaneously sustained without an existential threat to life on the planet.

But is it misleading, simplistic, and maybe even harmful to popularize degrowth in general as the solution to the life-or-death challenge of carbon-emission limits? Are there different kinds of “growth” -- minimal emissions, emissions-neutral, or even emissions-free-- that sidestep the rendezvous with climate disaster? Would not market-free, planned economic growth, itself, forestall that rendezvous? Can we not envision a growing, planned socialist economy that stems or reverses increases in emissions?

In the historically nuanced Marxist perspective, growth of the productive forces of society need not be coupled with an anarchical, unfettered, profit-driven economy, nor has it always been so associated. On the other hand, the preferred capitalist measuring stick of growth-- gross domestic product-- reflects that association: in the capitalist industrial era, growth (GDP), national wealth, the unregulated exploitation of carbon-based energy, and the exploitation of labor are inextricably bound. 

For Marxists, there is no such necessary link. Free of the wasteful uses of social wealth for class aggrandizement, class suppression, and endless accumulation, growth can be redefined as the unbounded improvement in both the quality and prospects of all human life. For example, the development of vaccines for Covid or future attacks of new viruses requires the further development of productive forces and constitutes a growth in social wealth, but with far less impact on the environment when undertaken outside the framework of the profit-driven capitalist system.

Marx and Engels gave us a different perspective on growth in The German Ideology, linking the development of forces of production directly to the improvement of humanity’s survivability and flourishing, while faced with ever-arising challenges from nature and other humans. They remind us that the mode of production is not only what people produce but how they produce. That ever-present, evolving challenge may, in some sense, at some time, require “growth,” but growth away from carbon emissions, waste, excess, inefficiency, and greed. Thus, we would define a new, humane concept of growth and production.

Foster comes close to recognizing this possibility by distinguishing “a quantitative as well a qualitative sense” of productive forces. But he seems to overlook that the qualitative expansion of productive forces might well be qualitative production, production independent of fossil fuels, carbon emissions, and environmental degradation-- production of new ideas, new living arrangements, new divisions of labor, etc. This would be a more refined notion of growth, far more useful than the BEA or OECD definition of gross domestic product that degrowth addresses. 

Two contributors, Isikara and Narin, are dismissive of the explanatory power of the second law of thermodynamics in the social world. Yet it does capture the fundamental struggle that only humans wage with ultimately limited, but astonishing success against a system’s tendency toward disorder. The development of productive forces was-- qualitatively or quantitatively-- the primary effective human response to this law: the law of entropy. The idea of degrowth, so superficially compelling in its simplicity, fails to account for this universal struggle. The environmental crisis is only the latest chapter in the perpetual struggle against species extinction. Like previous struggles, it will take development (and in the broadest sense, growth) of the productive forces to win, even if only temporarily from the inevitable disorder of closed systems.

Perhaps the biggest obstacle to a just, viable solution to the environmental crisis is the gross inequalities found in the capitalist countries and found between the advanced capitalist countries and those less advanced. The weakness of the degrowth mantra aside, any immediate solution to the crisis will require limits to carbon emissions, limits that will fall unfairly upon the disadvantaged unless some compensatory distribution-- national and global affirmative action-- is established. In other words, should sacrifices be necessary, they must be fairly imposed. No poor country or poor population should be required or even asked to make commensurate sacrifices with wealthy countries or wealthy elites. More importantly, their development-- their ‘catching up’-- should not be delayed as long as they lag behind their wealthier counterparts. Jason Hickel and Dylan Sullivan make a powerful historico-empirical argument that capitalism can never meet this demand in their contribution. 

The only large-scale affirmative action program ever effectively actuated was the post-World War II collaboration of the socialist countries, coordinated by the Council on Mutual Economic Assistance (CMEA, known in the West as Comecon). The CMEA based itself on the Leninist doctrine and the history of intensive investment of Soviet resources in the former Russian empire’s disadvantaged oppressed nations. Cognizant of the uneven development produced and reproduced by class society, the Soviet Union proportionately devoted far more resources to the “backward” constituent republics than to the more advanced Russian Republic.

The CMEA sought to continue this policy with the post-war socialist community. For example, the Soviet Union would offer an extended contract for oil to Cuba at the lowest market price of a previous period, while agreeing to purchase a fixed amount of sugar at the highest market price of that period. In addition, the Soviet Union would grant the poorer member state favorable, extended payment terms. It should be noted that the Soviet beet crop was more than adequate to supply Soviet sugar needs at a lower cost. At the same time, the Soviet Union would provide grants and low-interest, long-term loans for Cuban infrastructure and industrial development.

This, and most internal CMEA agreements, typified affirmative action on a massive scale to correct uneven development.

Given that capitalism has never known or even devised such a leveling, developmentally egalitarian approach in international affairs nor that any country today practices it (apart from socialist Cuba, generously, but with limited resources), the necessity for global affirmative action on the environment would seem to be a powerful argument for socialism among leftist activists. 

True to the history of Western Marxism, European-North American socialists find little worthwhile in the history of the Soviet Union, so the argument seldom sees the light of day.

That is not to say that the contributors to Degrowth Planning are unaware of the inequalities standing in the way of any fair and equitable answer to the environmental crisis. Foster is explicit: “At the same time, the poorer countries with low ecological footprints have to be allowed to develop in a general process that includes contraction in throughput of energy and materials in the rich countries and the convergence of per capita consumption in physical terms in the world as a whole.”

But what is lacking with all the participants’ accounts is agency. Who will tackle these challenges? Who will adopt a program that incorporates these considerations? Who will build a movement to move a program forward? 

It would be unfair to fault the twelve academics contributing to this issue for having no ready answer to these questions. Nonetheless, if theory is to matter, we must have practical answers (Isikara and Narin almost broach this issue, but deliver it in unnecessarily opaque academic language) and avoid utopia-spinning. Too often intellectuals deliver theory in the passive voice: “What is objectively necessary at this point in human history is therefore a revolutionary transformation… governing production, consumption, and distribution… a shift away from the system of monopoly capital, exploitation, expropriation, waste, and the endless drive to accumulation.”

Yes, but who is to accomplish this and how are they to do it?

It is far easier to say who will not do it! But surely it can be conceded that we need a class-based revolutionary party committed to a robust socialism that will wrest political and economic power from the capitalist class. Should we not be vigorously working toward that end if we want to avoid our date with doom?

Despite my reservations, I strongly recommend the special Monthly Review issue devoted to the environmental crisis, entitled Planned Degrowth: ecosocialism and sustainable human development.

Greg Godels

zzsblogml@gmail.com