Monopoly Capital

The other major twentieth century development in Marxism we will mention is the growth of the "Monopoly Capital" school of thought. The leaders of this school were Americans, Paul Sweezy and Paul Baran.

This idea stems partly from the recognition that real capitalist markets are often not very competitive, but can be dominated by big businesses that can, to some extent, control supply, prices and profit margins. This adds a fifth way to increase s/v: obtain a monopoly position in your industry, and push up prices.

Other points made by the Monopoly Capital school include the following:

While class struggle over surplus-value is the driving force of any class system, classes are not monoliths, and struggle between factions within a class can be important too. In American capitalism, for example, the division between "Monopoly Capital," that is national and international corporate "big business" and smaller-scale business, often equally monopolistic but only on a local basis, has been quite important in the twentieth century.
The world working class is equally divided, and at some periods highly unionized workers in some "more developed" countries have in effect been among the beneficiaries of the exploitation of very poor workers in less developed countries.
Government can be an active agent of exploitation. Marx had said that in a capitalist society, the government is the executive committee of the employing class; but government and bureaucracy play very little role in Capital. By the 1960's, the Monopoly Capital school -- never uncritical supporters of the Soviet Union -- had come to the conclusion that the Soviet bureaucracy was an exploiting class that would eventually evolve into a capitalist class.

Some of the Monopoly Capital scholars had some striking success at long-term forecasting. In an essay entitled "The Peaceful Transition from Socialism to Capitalism," Sweezy predicted the collapse of Communism in the Soviet Union, twenty years in advance of the event, and that the Soviet managerial class would become a capitalist class. Twenty-five years ago, James O'Connor (in The Fiscal Crisis of the State New York: St. Martin's Press, 1973) predicted the chronic government deficits that have plagued the more developed countries for the last twenty years. It seems clear that "Monopoly Capital" Marxism can be a powerful tool of diagnosis of Capitalist dynamics, at least in some hands.

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