crises of capitalism

crises of capitalism

(MARXISM) the periodic ECONOMIC CRISES which occur in capitalist economies in association with the TRADE CYCLE, which, according to some Marxists, tend to deepen as capitalism advances, although MARX himself did not take such a view consistently. A deepening of the crisis tendencies in capitalism is seen as associated with a contradiction between an increasing 'S ocialization’ of production (e.g. increased interdependency between different parts of the capitalist system) and the lack of any general mechanism for its coordination. One way in which cyclical crisis tendencies in capitalist societies have been controlled, especially in the course of the 20th century, is by government intervention in the economy. Sometimes it has been suggested that such interventions have been counterproductive (see KEYNESIAN ECONOMICS, FISCAL CRISIS IN THE CAPITALIST STATE). However, alternative policies introduced to ‘correct’ such intervention-related tendencies to crisis, in their own way also involve interventions. Thus no entirely convincing economic arguments have been adduced that tendencies to periodic crisis within capitalism, and any long-run tendencies to deepening crisis, cannot be smoothed or overcome by government, or increasingly by inter-state, intervention. Periodic crises are the way capitalism as an overall system adapts to new conditions, with periods of crisis being soon followed by periods of rapid growth. Whether the requirement of capitalism for ceaseless economic accumulation will ultimately be undermined by crisis tendencies which are ecological in source is a different matter. See also IMPERIALISM, DEPENDENCY THEORY.