CAPITALIST DEVELOPMENT AND CRISIS THEORY Accumulation, Regulation and Spatial Restructuring

Also by M. Gottdiener

CITIES IN STRESS (editor) THE CITY AND THE SIGN (editor with Alexandros Ph. Lagopoulos) THE DECLINE OF URBAN POLITICS PLANNED SPRAWL THE SOCIAL PRODUCfiON OF URBAN SPACE

Also by Nicos Komninos

THEORY OF URBANITY (in Greek, 3 vols) URBAN DEVELOPMENT AND PLANNING (in Greek) ESPACE URBAIN, ARCHITECfURE ET IDEOLOGIE

Capitalist Develop01ent and Crisis Theory: Accumulation, Regulation and Spatial Restructuring Edited by M. Gottdiener Professor of Sociology and Chair, Urban Studies Program University of California, Riverside and

Nicos Komninos Assistant Professor of Urban Planning, Aristotelean University of Thessaloniki

Palgrave Macmillan

ISBN 978-1-349-19962-4 ISBN 978-1-349-19960-0 (eBook) DOI 10.1007/978-1-349-19960-0

© M. Gottdiener and N. Komninos 1989 Softcover reprint of the hardcover 1st edition 1989 978-0-333-45582-1

All rights reserved. For information, write Scholarly and Reference Division, St. Martin's Press, Inc., 175 Fifth Avenue, New York, NY 10010

First published in the United States of America in 1989

ISBN 978-0-312-02102-3

Library of Congress Cataloging-in-Publication Data Capitalist development and crisis theory. Includes index. 1. Capitalism. 2. Business cycles. 3. Saving and investment. I. Gottdiener, Mark. II. Komninos, Nicos HB501.C24273 1989 338.9 88-15848 ISBN 978-0-312-02102-3

To the memory of Gregory Garwick and Thora Paulson- M.G. To Elena and Alexandros- N.K.

Contents List of Figures

List of Tables

Acknowledgements

Notes on the Contributors

Introduction M. Gottdiener and N. Komninos

PART I THEORIES OF LATE CAPITALISM AND CRISIS

IX

X

xi

xiii

2 An Introduction to a Theory of Crisis Theories 21 James O'Connor

3 Theories of Crisis: An Explanation of the 1974-82 Cycle 30 Ernest Mandel

4 Three Crises: The Metamorphoses of Capitalism and the Labour Movement 59 Alain Lipietz

PART II INTERNATIONALISATION OF ACCUMULATION: THE CRISIS OF INTEGRATION, TRADE AND DEBT

5 The Uncoupling of the World Order: A Survey of Global Crisis Theories 99 John Bellamy Foster

6 Nation-State and European Integration: Structural Problems in the Process of Economic Integration within the European Community 123 Klaus Busch

7 The Problem of Capitalist Development: Theoretical Considerations in View of the Industrial Countries and the New Industrial Countries 154 John Milios

1

viii Contents

8 Industrialisation, De-industrialisation and Uneven Development: The Case of the Pacific Rim Mike Berry

9 The Infernal Logic of the Debt Crisis Ernest Mandel

PART III CRISIS IN THE MODE OF REGULATION: THE RESTRUCTURING OF THE WELFARE STATE

10 Economic Crisis and Welfare State Recommodification:

174

217

A Comparative Analysis of the United States and Britain 237 Desmond King

11 Conservative Regimes and the Transition to Post-Fordism: The Cases of Great Britain and West Germany 261 Bob Jessop

12 Political Regulation: The Crisis of Fordism and the Transformation of the Party System in West Germany 300 Juergen Haeusler and Joachim Hirsch

PART IV CAPITALIST RESTRUCTURING AND SPATIAL CHANGE

13 The Change of Regional Inequality in the Federal Republic of Germany 331 Hartmut Hiiusermann and Thomas Kriimer-Badoni

14 From National to Local: The Janus Face of Crisis 348 Nicos Komninos

15 Crisis Theory and Socio-Spatial Restructuring: The US Case 365 M. Gottdiener

16 Financial Crises and the Evolution of Capitalism: The Crash of '87- What Does it Mean? 391 Hyman P. Minsky

Index 404

List of Figures

3.1 Cyclical evolution of productive investment in the private sector of seven major countries

3.2 Taxes on profits and corporate profits in Great Britain

48

showing mutual decrease of taxes and profits 49

6.1 Development of the Price Index for Consumer Goods in selected countries (1976-82) 134

6.2 Bilateral Foreign Trade Balances between the FOR and other selected EC countries (in billion OM) 1972-82 137

6.3 Bilateral Foreign Trade Balances (15 specified sub-groups of goods of the industrial statistics) between the FOR and selected EC states (in billion OM) 1972-82 138

List of Tables

3.1 Evolution of strike struggles (in yearly averages) 45

6.1 Real gross national product, productivity, real wages and consumer prices (the average annual percentage change) 132

6.2 Change of the ECU parity of the EC currencies from March 1979 until August 1986 (per cent) 135

6.3 Changes of the bilateral OM exchange rate vis-a-vis different European currencies 1979-81 135

8.1 Selected growth rates 177

8.2 Sector share of industry, selected countries 179

8.3 Distribution of manufacturing added, 1981 (per cent) 180

8.4 Export growth, selected countries 180

8.5 Origin and destination of merchandise exports (per cent) 182

8.6 Japanese direct investment, 1984-85 209

9.1 Accumulated debt at end-1985 218

9.2 Clandestine export of capital from selected countries 222

Acknowledgements

The editors would like to thank James O'Connor and Basil Blackwell Publishers for permission to publish a revised version of the introduction to The Meaning of Crisis: A Theoretical Introduction (1987); Ernest Mandel for his permission to publish a revised version and translation of chapters 25 and 26 of La crise (Paris: Flammarion, 1982), and for permission to publish a revised version of 'The Infernal Logic of the Debt Crisis' which first appeared in International Viewpoint (1986).

The editors would also like to thank Olga Varveri for her translation of the material from La crise and for helping in the translation of 'Three Crises' by Alain Lipietz. In addition, we wish to thank Simon Winder, our editor at Macmillan, for his kind attention to our project.

Finally, M. Gottdiener would like to thank the Academic Senate of the University of California, Riverside, for intramural grant support which aided the completion of this collection.

Notes on the Contributors

Mike Berry is head of the Department of Planning, Policy and Landscape, Royal Melbourne Institute of Technology. He co-edited Austalian Society, is co-author of Urban Political Economy: The Australian Case and author of Marxist Approaches to the Housing Question and The Political Economy of Australian Urbanization.

Klaus Busch is Professor of Political Science at the University of Osnabriick. He is the author of The Multinational Firms: A Contribution to the Laws of Internationalization of Production (Frankfurt/Main, 1974), The Crisis of the European Community (Koln u. Frankfurt, 1978), and co-author of Structures of the Capitalist World Economy (Saarbrucken, Ft Lauderdale, 1984).

John Bellamy Foster is Assistant Professor of Sociology at the University of Oregon. He is the author of The Theory of Monopoly Capitalism (Monthly Review Press, 1986) and co-editor of The Faltering Economy: The Problem of Accumulation Under Monopoly Capitalism (Monthly Review Press, 1984).

M. Gottdiener is Professor in the Department of Sociology at the University of California, Riverside and Chair of the Urban Studies Program. He is the author of Planned Sprawl: Private and Public Interests in Suburbia (Sage, 1977), The Social Production of Urban Space (University of Texas Press, 1985), The Decline of Urban Politics: Political Theory and the Crisis of The Local State (Sage, 1987). Editor of Cities in Stress: A New Look at the Urban Crisis (Sage, 1986), co-editor of The City and the Sign: An Introduction to Urban Semiotics (Columbia University Press, 1986).

Thomas Kramer-Badoni is Professor of Regional and Urban Sociology at the University of Bremen. He is the author of Zur Legitimitat der Burgerlichen Gesellschaft (Frankfurt/New York, 1978), and the co-author of Zur Soziookonomischen Bedeutung des Automobils (Frankfurt, 1971), and Die Kneipe: Zur Soziologie einer K ulturform (Frankfurt, 1987).

xiv Notes on the Contributors

Juergen Haeusler is Assistant Professor of Political Science at the University of Frankfurt. He is the author of several articles on energy politics, industrial policies and political parties.

Hartmut Hausermann is Professor of Regional and Urban Sociology at the University of Bremen. He is the author of Die Politik der Burokratie (Frankfurt, 1978), co-editor of Sud-Nord-Gefalle in der Bundesrepublik? (Opladen, 1986), co-author of Neue Urbanitat (Frankfurt, 1987).

Joachim Hirsch is Professor of Political Science at the University of Frankfurt. He is the author of numerous books and articles on state theory. His latest publications include 'Der Sicherheitsstaat' (1980) and as co-author, 'Das Neue Gesicht des Kapitalismus' (1986).

Bob Jessop is Lecturer in Government at the University of Essex. He has worked for many years on issues in the theory of the capitalist state and on topics in the political economy of post-war Britain. He is the author of The Capitalist State (1982), Nicos Poulantzas (1985), The Political Economy of Post-war Britain (1988), as well as many articles on these and related themes.

Desmond King lectures in Politics at the University of Edinburgh. His main interests lie in state theory, political economy and urban politics. He is the author of The New Right: Politics, Markets and Citizenship (Macmillan and Dorsey Press, 1987), The Cities (Methuen, 1988), and co-author of The State and the City (University of Chicago Press, 1987), as well as numerous articles.

Nicos Komninos is Assistant Professor of Urban Planning in the Department of Urban and Regional Planning, Aristotelean Universi­ty of Thessaloniki. He is the author of five books and numerous articles on spatial development and crisis, city planning theory and methodology, design ideology and practices, including Theory of Urbanity (1986) in Greek, three books dealing with contemporary crisis, spatial restructuring and new forms of local regulation.

Alain Lipietz is an economist at CEPREMAP in Paris, France. He is the author of numerous articles and books on contemporary political economy including Crise et inflation: pourquoi? (1979), Le Monde enchante (1983), L'audace ou l'enlisement (1984), Mirages et miracles (1985).

Notes on the Contributors XV

Ernest Mandel is Professor at the Vrije Universiteit in Brussels. Among his numerous books are: Marxist Economic Theory, Late Capitalism, Trotsky, a Study of the Dynamics of His Thought, Revolutionary Marxism Today, The Long Waves of Capitalist Development, The Second Slump and Delightful Murder - The Meaning of the Second World War.

John Milios lectures in political economy at the National Technical University in Athens. He is editor in chief of the theoretical sociological and economic journal Thessis (in Greek) and he is the author of articles on capitalist development and political economy.

Hyman P. Minsky is Professor of Economics at Washington University, St. Louis, MO. He was educated at the University of Chicago and Harvard and is author of John Maynard Keynes, Can It Happen Again?, Stabilizing an Unstable Economy, as well as numerous articles in professional and public journals.

James O'Connor is Professor of Sociology and Economics at the University of California, Santa Cruz. Prior to this he was Professor of Economics at San Jose State University. His latest books are The Meaning of Crisis: A Theoretical Introduction (Basil Blackwell, 1987) and Accumulation Crisis (Basil Blackwell, 1985).