The Theory of Monopoly Capitalism by Foster John Bellamy;

Author:Foster, John Bellamy;
Language: eng
Format: epub
Publisher: Monthly Review Press
Published: 2014-06-19T04:00:00+00:00

State Expenditures in a Class Society

Unlike O’Connor’s Fiscal Crisis of the State, which divided state spending into “social capital” and “social expenses” in order to demonstrate the fundamental thesis of a “structural gap” between the growth of spending and the growth of revenues, Baran and Sweezy’s Monopoly Capital, with its focus on surplus absorption, approached the composition of state spending primarily in terms of the systematic bias away from those areas that could be considered reproductive, from the standpoint of society as a whole, and toward those areas, like military spending, that belonged to the nonreproductive utilization of social surplus.49 Hence the issue of state expenditures in U.S. class society was introduced in the following way:

During the interval 1929–1957, total government spending increased from roughly one-tenth to one-quarter of GNP, most of the difference representing the absorption of surplus which would not otherwise have been produced. Of this proportionate increase in the ratio of government spending to GNP, almost nine-tenths was transfer payments and defense purchases, little more than one-tenth non-defense purchases. How are we to interpret these figures?50

The most important thing to recognize here was that “government’s direct contribution to the functioning and welfare of society is almost entirely subsumed under nondefense purchases.”51 This includes not only education and highways (the two biggest expenses), but also commerce, housing, health, sanitation, police and fire protection, the justice system, prisons, administration, and so on. What is noteworthy is that in spite of a vast expansion in the highway system in particular, associated with a doubling of the number of automobiles over the period, nondefense purchases made “almost no contribution to the solution of the surplus absorption problem.”52

Transfer payments, which had grown from 2 percent to 6 percent of GNP over the period, had, Baran and Sweezy contended, probably “made a significant contribution” to staving off stagnation. Nevertheless, the regressive nature of the payroll taxes on which social security was based, and the fact that some 12 percent of transfer payments were actually interest payments to banks, corporations, and wealthy individuals, diminished the extent to which such payments were part of the “solution” rather than the problem.53

It was in the area of military spending, however, that the real expansion had taken place, rising “from less than 1 percent of GNP to more than 10 percent, accounting for about two-thirds of the total expansion of government spending relative to GNP since the 1920s.” Moreover, without the prop of military spending, they contended, unemployment would be back up to levels of 15 percent or more, “such as prevailed in the 1930s.”54

But was this an intrinsic feature of U.S. capitalism, or could military spending simply be replaced by civilian spending if the voters so decided? The answer lay in the “modalities of political power in a monopoly capitalist society, and more specifically in its particular American version.”55 For Baran and Sweezy this had two aspects: (1) the theory of the state as such, and (2) the social limitations on civilian spending.

Baran and Sweezy’s analysis of

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.