When news came that Paul Sweezy had died we turned to ROBERT POLLIN, once a student of Sweeezy’s, for input on Sweezy’s economic contributions. Pollin is professor of economics at U Mass, Amherst, at the Political Economy Research Institute, which he and his colleagues have made into a power house of research, most notably into the living wage campaigns across the US, most recently in New Mexico and Louisiana, which Pollin pioneered. A few months ago we reviewed here Contours of Descent: US Economic Fractures and the Landscape of Global Austerity, Pollin’s superb book on the US economy in the Clinton and early Bush years. Pollin swiftly responded with the extremely enlightening reflections below. AC.
Here are some thoughts on Paul Sweezy.
First, on his major intellectual and political contributions:
There is no doubt that Paul was the leading Marxian economist in the United States, and probably the world, during his lifetime. Certainly he was the most widely recognized and respected. In my view, he made four major intellectual/political contributions.
1. His book, Theory of Capitalist Development (first published, I believe in 1942), was an extraordinarily cogent explanation of the economics of Karl Marx, in particular the main themes of Capital. Paul went through all the basic issues, starting with the labor theory of value, and getting all the way to the falling rate of profit. However, this was not merely a work of exegesis-of collecting and assembling quotes. Paul presented a clear and fair treatment of Marx, but he also developed some ideas of his own. Perhaps most important, Paul was critical of the falling rate of profit explanation of economic crisis in Marx-and that criticism was all the more powerful because Paul presented Marx’s arguments in such a clear way. But Paul went further than criticism: he also developed the underconsumptionist strains in Marx’s writings, which were not as well developed in Capital as the falling rate of profit arguments. No doubt, Sweezy was strongly influenced by the pull of JM Keynes in developing the underconsumptionist arguments in Marx. Keynes said the macroeconomic problem of capitalism was effective demand-and that was the cause of the 1930s depression. Sweezy saw this point coming out of Marx, and well before Keynes. [By the way, Keynes himself acknowledged Marx, along with some obscure people, like Silvio Gessel, as predating him with an underconsumptionist perspective]. I will come back to this Marx/Keynes connection in Sweezy. But the main thing on Theory of Capitalist Development is that it was a classic, incredibly clear, exposition of Marxian economics. It remains today the first place I would send a student who wants to get the basics of Marx in a serious, but still totally accessible way.
2. The next big book was, of course, Monopoly Capital, written with Paul Baran, though Baran died before they finished the manuscript. This book tried, and succeeded in many ways, to bring Marxism alive for its time. It was not another exposition of Marxian economics per se, and it did not use Capital in an orthodox way. It was trying to capture the spirit of Marxism in an era of giant corporations and big government capitalism. It focused on the U.S., deliberately, in the way Marx focused on England in Capital-as the most important and advanced capitalist economy. It was also written with the 1930s depression and 1940s war-induced amazing recovery as the background. Thus, Sweezy and Baran hypothized about a “tendency of surplus to rise” rather than the profit rate to fall. Surplus would rise because big corporations had monopolistic pricing power, and so they could extract surplus both from non-monopolistic elements of the U.S. economy, and from less developed countries, which at the time included everyone. The fundamental problem to the internal logic of this system was then, what they termed “surplus absorption”-who was going to buy the things that the corporations could produce? This is how they linked up the issue of big government and imperialism with the functioning of the monopolistic capitalist model. They said military spending was necessary to buy up the surplus product; and thus we needed the cold war, and imperialism, to prevent the economy from again lapsing into depression. Here again you see the links with Keynesianism, and with the obviously powerful experience of coming out of the depression: the only thing that brought us out of the depression being, obviously, massive deficit spending to pay for the war. And here is where the idea of military Keynesianism becomes very clear.
I would add though that the idea of military Keynesianism was first articulated clearly by Kalecki in his great short paper “The Political Aspects of Full Employment”. Paul acknowledged his debt to Kalecki many times. He also said that Monopoly Capital was heavily influenced by Josef Steindl’s book, Maturity and Stagnation in American Capitalism. In any case, Paul was indeed trying to synthesize Marxism with aspects of Keynesianism, as well as the theory of monopoly. This latter connection also made lots of sense, since Paul himself, in an earlier incarnation, had made a major contribution to the theory of monopoly pricing, a topic to which I’ll return below.
3. The third major intellectual and political contribution by Paul was, of course, his creating Monthly Review, and serving as its co-editor for 50 years. I mentioned this contribution third, but I don’t mean to place it third. It is probably first in terms of overall influence and as a measure of Paul’s lifelong dedication to the left. However, it is also true that Monthly Review would not have had anything close to the stature it enjoyed had Paul not also been the author of Theory of Capitalist Development and Monopoly Capital. Monthly Review was hugely important, in my view, in sustaining a serious Marxian left that was talking about real things, and not wandering into either cult-like Marxology or over academic trivia. It was also important in maintaining a focus on political economy as central to Marxism, just as Karl himself meant it to be. Monthly Review did also spawn something like what Paul and Harry liked to call “The Monthly Review school.” I would say the most important stream of that school of thought was its perspective on imperialism and underdevelopment. It was connected to what became known as the “dependency school”-the view that the third world was underdeveloped because of the system of dependency that was created by imperialism. The Monthly Review version of this approach was more infused with a Marxist spirit, but it was basically in this strain of thought. Certainly Andre Gunder Frank and Harry Magdoff was major thinkers here, as well as Paul himself.
But the main thing with Monthly Review wasn’t so much the specific things that were in it, but rather that it existed and it kept going, all through the dark McCarthy period. It then was a touchstone for the left as the 1960s burst out. This leads me to what I think was a fourth major contribution by Paul, starting really in the 1970s.
4. This fourth contribution was the work Paul was doing with Harry Magdoff, beginning in the late 1960s and continuing through the 1970s and 1980s, of documenting the emerging form of capitalism that has now become ascendant-the increasing role of finance in the operations of capitalism. This has been termed “financialization”, and I think it’s fair to say that Paul and Harry were the first people on the left to notice this and call attention. They did so with their typical cogency, command of the basics, and capacity to see the broader implications for a Marxist understanding of reality. I myself was heavily influenced by this work when I was a graduate student. Indeed, I got my idea for my dissertation after I read a Review of the Month by them called “Debt and the Business Cycle.” They were writing such things when, at the same time, the New School itself didn’t even have a field in financial economics-since most of the people thought this was for the bourgeoisie to figure out on their own.
5. I mentioned Paul’s earlier work on monopoly and want to come back to that. Before Paul was involved in Marxian economics, he was a superstar graduate student and junior faculty member at Harvard. He was the protégé of Joseph Schumpeter, who was conservative but brilliant and open-minded. Anyway, in this early phase of Paul’s career, he developed an explanation for how oligopolistic firms set their prices-he called it a “kinked demand curve.” The kink in the kinked demand curve refers to the capacity of oligopolists to push up prices beyond what a normal smooth demand relationship would suggest because of their pricing power. This was an important contribution in the literature on microeconomics and industrial organization, and I believe Paul wrote it as a graduate student. In any case, this theory was in all the textbooks. There is even a story that someone told me about an orthodox economist, obviously totally oblivious to anything about the left, who said something like the following: “Remember that guy Paul Sweezy? He was this brilliant young economist who came up with the kinked demand curve theory. Too bad he died so young.”
Some other Sweezy stories:
The connection with Schumpeter is very interesting. Schumpeter clearly admired Sweezy greatly. And remember, at the time, with the exception of Keynes, Schumpeter was probably the most prestigious economist in the world. Schumpeter wrote this massive history of thought book, which went far beyond what anyone else had attempted, at least in terms of length, called History of Economic Analysis. The number of references to Paul Sweezy in the index of that book are quite substantial. I would guess Sweezy was in the top 10-15 in terms of references-and that’s pretty good when you are talking about the whole history of economic analysis, including everyone. And this was before Sweezy had done Monopoly Capital.
There is more to the Sweezy/Schumpeter connection in my view, though I don’t think anyone else had ever thought about this. Schumpeter wrote this wonderfully provocative book called Capitalism, Socialism and Democracy. He was really reaching to be provocative since he started one section with the book asking the question: “Can Capitalism Survive?” And he answered no-this coming from probably the leading intellectual defender of capitalism in the world at the time, with the possible exception Hayek. But there’s more. Schumpeter then goes on to ask: “Can socialism succeed?” And to this, his answer is an equally shocking, “Yes, I think it can.”
Now Schumpeter goes on to explain what he really means when he gives these answers. And in both cases, I think he was heavily influenced by his relationship with Paul. Can Capitalism survive? He said no because he said capitalism breeds intellectual freedom, people with critical minds. And it was only inevitable that this spirit would breed powerful minds who would turn their guns on the deficiencies of capitalism itself. No doubt, he had Sweezy in mind here-since here was Sweezy, the smartest young economist at Harvard, from a ruling class family, becoming a Marxist before Schumpeter’s own eyes. Then on the question of socialism. Schumpeter says it will succeed, in that it will be workable, though it will be cumbersome and bureaucratic, if more egalitarian than capitalism. And how will it even work at that level? Because the brilliant thinkers who have grown dissatisfied with the crassness and injustices of capitalism will also rise to the top in a socialist society, and make it function decently well. And again, who else could he have had in mind here but Paul, his student and protégé? Anyway, I once asked Paul about this theory of mine. He didn’t dismiss it, but of course, he was too modest to claim it was entirely true. He told me, “well there were lots of people around then and Schumpeter was just picking up the spirit of the time.” Yes, true, but no doubt, Sweezy embodied that spirit for Schumpeter more fully and powerfully than anyone else.
On his Harvard career-again I think before he became a Marxist, Paul and some other graduate students put together a small book called, I think “A Program for American Democracy.” It was a clear exposition of how to implement a Keynesian demand stimulus program for the fighting the depression. My understanding was that it had some significant influence at the time it came out-Kindleberger, for example, cites it in his history of the Depression.
Let me finally give a few personal thoughts. I may be the only person in the world who can make this claim: outside of high school, the first book I ever read in economics was Monopoly Capital, and the first teacher of economics I ever had was Paul Sweezy. In my first semester at the New School, spring of 1975, I took Paul’s course titled “Reading and Using Capital.” As you can imagine, I was totally pumped to be taking a course on Marx’s Capital from the person universally acknowledged as the leading Marxist economist in the world at the time. When I met with the student advisor my first day there, I told him I felt like I would be taking a course on the Civil War taught by Abraham Lincoln.
Anyway, the advisor-Ron Blackwell, who is now a leading official of the AFL-CIO-told me that “Paul Sweezy isn’t really a Marxist but a Keynesian.” I didn’t know enough to have any idea what Ron meant by that. I have subsequently come to understand the comment. In fact, there is a lot of Keynes in Sweezy-as I mentioned before, with respect to both Theory of Capitalist Development and Monopoly Capital. This was a powerful synthesis he was attempting, while still retaining the basic spirit and commitments of Marxism.
There was a fever pitch at the New School when the course began. On the first day, probably 400 people or so showed up, and you couldn’t get into the room. The next class, you had to show your proof of enrollment to get into the class, as another 400 showed up. However, things calmed down very quickly once we really got into things. Paul was an amazingly clear and committed teacher. But he definitely wasn’t into any kind of theatre of teaching or histrionics. So the course rapidly thinned down to 30-40 people who really wanted to hear Paul expound on Marx.
Among the students-though he didn’t come every time-was Daniel Ellsberg. I noticed this person one day just sitting there in class, taking notes on the lecture, like everyone else. This of course was at the very height of Ellsberg’s fame. I said to another student something like, “Isn’t that weird. That guy over there looks exactly like Daniel Ellsberg.” Ellsberg heard me say that, and just walked over to me, stuck out his hand, and said, “Hi, Dan Ellsberg.” Then we started talking about the class. He said he didn’t agree with Sweezy or Marx, because the Marxian tradition doesn’t give enough weight to spiritual and religious impulses in understanding human behavior, or something to that effect. Anyway, it was a very interesting discussion. Ellsberg was perfectly happy to mix it up with the students, and try to learn from the great Sweezy.
At the time, the first English translation of the Grundrisse had just been published. Paul was extremely upset about the way it had turned out, and mentioned it to us repeatedly. As I recall, it all hinged on a mistranslation of the word from German, “Realization” I really don’t remember the problem exactly, but on reflection it all definitely had to do with Paul’s focus on the issue of underconsumption, or “realization failure” in understanding Marx’s theory of economic crisis. Apparently Paul thought all this got garbled in the English translation of the Grundrisse, where it had been very clear in the original. This was a regular theme in the class, and became a joke among the students-here goes Sweezy again on “realization”
Another more trivial thing about Paul then that we students joked about was the way he dressed. He had these two loud short-sleeved shirts-one I think was orange and the other one was blue. He seemed to wear these shirts on alternating days-as though he knew which loud shirt to wear according to the day of the week. We would say, “it’s a good thing he has on his blue shirt today. Otherwise, we might be going over the material from last week’s class.” The general point is this: Paul was completely unadorned, completely without pretension, and paid not the slightest bit of attention to how he dressed.
Which brings up another point. Paul was legendarily handsome in his younger years, and apparently the attraction for women remained powerful. Some evidence: Paul Samuelson himself wrote about it, in an article in Newsweek called, I believe, “When Gods Strode The Earth.” Samueulson was writing about a debate at Harvard between Schumpeter and Sweezy in the midst of the Depression, when Samuelson was a student there. In the article, as I recall, Sweezy, not Schumpeter, was “the God”-he was so smart, so rich, so handsome, and so Marxist. He apparently made mincemeat of the great Schumpeter, debating the most burning issue of the time. More evidence: In the mid 1980s I was at a small weekend retreat sponsored by MR. I happened to be talking to woman professor at the conference, Patricia Fernandez-Kelly (used to be at Johns Hopkins, not sure if she’s still there). Anyway, I noticed that she broke off our conversation and became transfixed for almost a full minute. She then turned back to me and said, “Look at Sweezy. He is so beautiful.” And this is when Paul was in his mid seventies.
So, you asked for thoughts of all kinds and you’ve got them. Paul was an amazingly great man. I could also give you some criticisms, both of his work and his politics. But at the moment these would seem totally trivial and petty.
ROBERT POLLIN is professor of economic and founding co-director of the Political Economy Research Institute at the University of Massachuesetts-Amherst. He is also the author of the Contours of Descent: US Economic Fractures and the Landscape of Global Austerity. He can be reached at: firstname.lastname@example.org.