Class Conflict, Keynesian Policies, and the Business Cycle

Profit-Led Growth, Social Democracy, and the Left: An Accumulation of Discontent

“…Glyn and Sutcliffe’s early contributions were decidedly anglocentric, 3 but their contentions were soon to be generalized. In a lead article of the Monthly Review , Radford Boddy and James Crotty (1974) both restated and generalized the profit squeeze thesis articulated by Glyn and Sutcliffe. In their account, Keynesian theory had renewed faith in the possibility of full-employment growth under capitalism, a possibility that Marx had squarely dismissed.…”

“…In their account, Keynesian theory had renewed faith in the possibility of full-employment growth under capitalism, a possibility that Marx had squarely dismissed. As the achievement of such growth had become Keynesians’ central aim, they had necessarily “glossed over the importance of the full-employment profit squeeze” (Radford Boddy and James Crotty 1974: 3). They rightly note that both Kalecki and Steindl had generally dismissed the possibility of a profit squeeze, suggesting instead that the costs entailed by rising wages would be passed through.…”

“…Mustering data from the United States to support their case, the apparent cyclicality of the wage share, along with the seeming rise in unit labor costs in the tail-end of business cycle expansions, lent considerable doubt to the Kalecki–Steindl proposition. Rising wages were not the only cause of the spike in unit labor costs during expansions, as it was also suggested that productivity growth would slow due in part to “an increasingly obstreperous labor force” (Radford Boddy and James Crotty 1974: 9). These dual mechanisms of the profit squeeze would play a central role in later models.…”

Capital‐Labour Tensions and Liberal Economic Thought

“…The argument that the business cycle is in fact a political cycle has been set forth by economists on both the right and the left. See, for instance [67][68][69][70]. 26.…”

The Capitalist State.

“…it can be found in 'neo-Ricardian' analyses of economic policy-making and implementation as well as in various works stemming from 'state monopoly capitalism' theorists. Thus neo-Ricardian theorists have often focused on the instrumentality of the state for and on behalf of capital through its interventions to maintain or restore profits at the expense of wages (e.g., Boddy and Crotty, 1974;Glyn and Sutcliffe, 1972;and Gough, 1975). Likewise 'stamocap' theorists claim that the state and monopolies have 'fused' into a single mechanism which acts on behalf of monopoly capital in the twofold attempt to secure the political and ideological conditions necessary to capital accumulation and to secure various economic conditions that can no longer be realised through the operation of market forces (see chapter 2).…”