The Catastrophic Failure of the Theory of “Catastrophism” (Part 3)


Note of the Editorial Board: This chapter contains figures which can only be viewed in the pdf version (download here).



The Current Historical Period which Opened in 2008/09




Let us now briefly characterize the present historic period which has opened in 2008. Since its beginning we have insisted that this period contains a revolutionary character. In a resolution written in early January 2009 we made the following prognosis which, in our opinion, has been fully vindicated since then:


The new period is characterized by a historical crisis of capitalism. It is a period not of years but has a more long-term character. It is a period where the “curve of capitalist development” (Trotsky) is pointing downwards and where the productive forces and the social development are retreating rather than advancing. It is a period where short-term booms are not excluded but where the crisis-ridden, depressive character of the world economy is the dominant feature. World politics will be characterized by increasing instability and rivalry because the imperialist hegemon – the United States of America – is no longer capable of dominating the world. Faced with this crisis, the imperialist bourgeoisie will launch huge attacks on the working class and the oppressed people and as a result we will see a sharp increase of class struggle. This is why this period will be marked by a series of wars, pre-revolutionary, revolutionary, and counter-revolutionary situations. This is why the new period is a revolutionary period.[1]


As we said in this resolution, and later elaborated more in detail, the basis of the revolutionary character of the new historic period was the dramatic decay of the productive forces. While the epoch of imperialism is generally marked by a stagnation of the productive forces, within it there are periods of varying tempos and dynamics for the development of the productive forces. In the current period, we can clearly see a decay of the productive forces. This finds its expression in unprecedented low growth of the world economy, low productivity, combined with record levels of global debts, the dramatic consequences of the devastating climate change which is endangering the survival of humanity, wars which result in massive destruction and huge refugee movements, etc. (See the next chapter for empirical evidence.)


As Trotsky once pointed out, the reduction of national economic wealth inevitable sharpens the contradictions between the classes and will, sooner or later, provoke clashes and explosions between the classes.


The classes of Germany, the number of workers and their concentration, the concentration of capital and its organizational form - all this had taken shape prior to the war, and in particular as a result of the last two decades of prosperity (1894-1913). And later on, all this became still more aggravated: during the war - with the aid of the state intervention; after the war - through the fever of speculation and the growing concentration of capital. We thus have two processes of development. National wealth and national income keep falling, but the development of classes continues there- with not to regress but to progress. More and more people are becoming proletarianized, capital is being concentrated in fewer and fewer hands, banks keep merging, industrial enterprises become concentrated in trusts. As a result, the class struggle inevitably becomes sharper on the basis of a declining national income. Herein is the whole gist of the matter. The more restricted becomes the material foundation under their feet, the more fiercely must classes and groups fight for their share of this national income. We must not lose sight of this circumstance for a single moment. While Europe has been thrown back 30 years with regard to her national wealth this does not at all mean that she has grown thirty years younger. No, in the class sense, she has become thirty years older.” [2]


By defining the historic period as “revolutionary” we never implied that there is a permanently present “revolutionary situation”. We rather pointed out that the economic and political equilibrium has become so instable that it inevitable results, again and again, in sharp tensions between the Great Powers, wars, pre-revolutionary and revolutionary as well as counter-revolutionary developments. The revolutionary character of the period lies in the fact that the acceleration of the contradictions provokes inevitable political and economic explosions and sharp zigzags. In a World Perspective document adopted in December 2016, the RCIT summarized its characterization of the historic period in the following way:


In summary: revolutionaries must be absolutely clear about the character of the present historic period, as well as about the nature of the phase within this period. Since the beginning of the Great Recession in 2008, we have been living in an historic revolutionary period. This is a period characterized by the acute decay of capitalism. In this period, the clashes and struggles being waged along the three fronts of imperialism’s contradictions are unavoidably exacerbated in all regions of the world: (a) the struggle between the bourgeoisie and the world proletariat; (b) the struggle of the Great Powers and monopoly capital against the oppressed people in the South; and (c) the conflicts between the imperialist rivals. These, in turn, will provoke revolutions, counterrevolutions and wars, and offer numerous opportunities (as well as dangers) for the working class to advance in its struggle for liberation. Currently we are living in a phase characterized by the reactionary offensive of the ruling class, one which has already resulted in a number of defeats for the workers and oppressed due to the chronic crisis of revolutionary leadership. However, this reactionary offensive unavoidably provokes new contradictions and new struggles. The new World Party will be forged under the blows of the reactionary offensive of the ruling class. It is towards the workers and oppressed engaged in these struggles that all revolutionary forces must orient all their efforts to build a new Revolutionary World Party.[3]


This quote also demonstrates that the RCIT never had a one-sided view that only revolutionary developments could take place. We rather emphasized from the beginning that if such revolutionary situations are not utilized by the workers vanguard and transformed into a successful revolution, counter-revolutionary situation will inevitable emerge.


The present historic period has to be understood, in fact it can only be understood, in a dialectical way. This period is characterized both by revolutions as well as by counter-revolutionary offensives. On the surface, these two elements seem to contradict each other. However, using the method of dialectics, the two poles form a unity of opposites. It is a revolutionary period because the capitalist class cannot develop the forces of production and, because of this, the ruling classes are attacking the social gains and the democratic rights of the workers and the oppressed. This, in turn, inevitable provokes mass resistance up to revolutionary uprisings.


Our understanding of the character of a revolutionary historic period is in accordance with Trotsky definition of such a period. In his critique of the Stalinist Comintern draft program Trotsky developed the following thought:


The revolutionary character of the epoch does not lie in that it permits of the accomplishment of the revolution, that is, the seizure of power at every given moment. Its revolutionary character consists in profound and sharp fluctuations and abrupt and frequent transitions from an immediately revolutionary situation; in other words, such as enables the communist party to strive for power, to a victory of the Fascist or semi-Fascist counter-revolution, and from the latter to a provisional regime of the golden mean (the "Left bloc," the inclusion of the social democracy into the coalition, the passage of power to the party of MacDonald, and so forth), immediately thereafter to force the antagonisms to a head again and acutely raise the question of power.[4]


Likewise, he emphasized in the very first paragraph of his report to the III. World Congress of the Communist International in 1921 the highly contradictory character of the capitalist equilibrium in such periods.


With the imperialist war we entered the epoch of revolution, that is, the epoch when the very mainstays of capitalist equilibrium are shaking and collapsing. Capitalist equilibrium is an extremely complex phenomenon. Capitalism produces this equilibrium, disrupts it, restores it anew in order to disrupt it anew, concurrently extending the limits of its domination. In the economic sphere these constant disruptions and restorations of the equilibrium take the shape of crises and booms. In the sphere of inter-class relations the disruption of equilibrium assumes the form of strikes, lockouts, revolutionary struggle. In the sphere of inter-state relations the disruption of equilibrium means war or – in a weaker form – tariff war, economic war, or blockade. Capitalism thus possesses a dynamic equilibrium, one which is always in the process of either disruption or restoration… This equilibrium has a great power of resistance, the best proof of which is the fact that the capitalist world has not toppled to this day.” [5]


We remark, as a side-note, that intelligent bourgeois analysts with a sense for history are also recognizing in their own way the fundamental explosive character of the present period. For example, the U.S. Federal Reserve Board recently published a study which attempted to create an index of “geopolitical risk” and their effects for the world economy. The authors of the study conclude that geopolitical events (we Marxists would prefer to speak about the struggle between the classes and states) indeed have important consequences for the economy. Moreover, the authors arrive to the conclusion that such “geopolitical risks” have substantially increased in the past years. They construct a historical index covering the years 1900 to 2017. They arrive at the conclusion that, leaving aside the periods around the two world wars, the period from 9/11 in 2001 until today has seen the most significant instability and crisis and that this process is accelerating.


High geopolitical risk leads to a decline in real activity, lower stock returns, and movements in capital flows away from emerging economies and towards advanced economies. (...) Extending our index back to 1900, geopolitical risk rose dramatically during the World War I and World War II, was elevated in the early 1980s, and has drifted upward since the beginning of the 21st century.[6]


In various documents, we have analyzed the period concretely and dissected different political phases inside this period. In summary, we identified a first phase after 2008 which we characterized as a “state of shock” of all classes. This was followed by the second phase which – starting in late 2010 / early 2011 – was characterized by a “massive upswing of the class struggle”. In the class struggle developments since then we have identified an initial phase which we called an “innocent phase” where the masses, full of illusions, either followed petty-bourgeois and bourgeois leaderships in movements (anti-dictatorship religious and secular opposition forces in the Arab Revolution, SYRIZA in Greece, Occupy movement) or elected them into office (Tunisia, Egypt).


However, this was soon replaced by a process of disillusionment and growing opposition to these leaderships. Starting with the bloody military coup of General Sisi in Egypt on 3rd July 2013 (scandalously hailed by the Stalinists, the Morenoite LIT, Alan Woods IMT and the Cliffite RS/IST as a “Second Revolution” of the popular masses!), another phase began which was characterized by a reactionary offensive of the ruling class and a number of defeats for the worker and oppressed. This counterrevolutionary offensive accelerated with the victory of Trump in the U.S. in November 2016, the institutional coup in Brazil against the PT-led government, the setbacks of the Syrian Revolution and the increasing racism and Islamophobia in the imperialist countries.


As we have analysed in our latest book on the world situation, we are observing important developments since late 2017 of accelerated warmongering in the Middle East as well as in North-East Asia but also growing resistance of the masses (Iran, Palestine, Tunisia, Morocco, Sudan, Honduras, India, Catalonia, etc.). [7] We will see if these developments open a new political phase.




Empirical Evidence for the Decay of Capitalism in the Present Historic Period




We have demonstrated the validity of our thesis of the decaying productive forces in a number of studies on the world economy. [8] At this place we will only provide a few figures to underline our argument.


The following two figures show the deepening crisis of capitalism since the beginning of the new historic period in 2008. Figure 4 demonstrates both the long-term decline of output per capita since the early 1950s as well as the massive slump in 2008/09.




Figure 4. Growth Rate of Real Capita Gross Global Product, 1961-2015 [9]




Figure 5 shows how the declining dynamic of the productive forces finds its expression in the development of labor productivity. As we can see the average growth of labor productivity has gradually declined in nearly all capitalist countries since the beginning of the 1950s. This long-term tendency has particularly accelerated in the new historic period of capitalist decay which opened in 2008. Labor productivity (measured in output per hour worked) declined significantly in nearly all major capitalist economies since the beginning of the new period.




Figure 5. Labor Productivity Performance in Long Run Comparative Perspective, 1950-2013 (GDP per hour worked; annual average growth) [10]







Another indication for the decay of the productive forces is the depression of the capital accumulation. Figure 6 shows the decline of net investment in the major old Western imperialist economies if measured as share of annual GDP. Figure 7 verifies the same tendency when net investment is viewed as share of the capital stock in the US economy.




Figure 6. Nominal Net Fixed Capital Formation in Western Imperialist Countries, 1991-2014 (as % of GDP) [11]






Figure 7. Net Investment as a Share of the Capital Stock, USA, 1945-2015 [12]



As we stated above, the decline of the productive forces is also reflected in the fact that the capitalists are increasingly forced to finance their business as well as their state apparatus by debts, i.e. by borrowing from tomorrows wealth (which might be created or not). Table 4 shows how dramatic global debt levels (measured as a share of global output) have increased in the past 15 years. It also shows that debt levels today are even substantially higher than they were before the Great Recession in 2008 – when such high levels triggered the slump!




Table 4. Global Debt (All Sectors), 2002-2017 [13]


                                In Trillion US-Dollar                          Global Debt as a Share of Global GDP


2002                       86                                                           246%


2007                       149                                                         276%


2012                       205                                                         305%


2017                       217                                                         327%




However, as we stated in our writings, the crisis of capitalism and the decay of its system is not only reflected in the decelerating dynamic of its economy. It finds also its expression in increasing inequality, mass unemployment, poverty and the dramatic climate change. For reasons of space we limit ourselves to reproduce only two figures.


Figure 8 shows the dramatic inequality in global wealth distribution between the classes and between the nations on a global level. According to figures from the Credit Suisse – a source which no one could suspect of anti-capitalist ideology – an insignificant minority (0.7% of the population), representing largely the global capitalist class, owns 41% of the world’s wealth. The global middle class (7.7% of the world population) owes together about the same amount (42.3 of the world’s wealth). The next 22.9% of the world’s population, probably representing the significant share of the working class of the imperialist countries and the middle class of the semi-colonial world, own 13.7%, and the huge majority of the world’s population (68.7%) – representing mostly the working class and the poor peasants of the South – own the little which remains (only 3%) of the world’s wealth!




Figure 8. How is the World’s Wealth shared amongst its Population? [14]






Likewise, an OXFAM study concludes: “In 2015, just 62 individuals had the same wealth as 3.6 billion people – the bottom half of humanity. This figure is down from 388 individuals as recently as 2010. The wealth of the richest 62 people has risen by 44% in the five years since2010 – that's an increase of more than half a trillion dollars ($542bn), to $1.76trillion.Meanwhile, the wealth of the bottom half fell by just over a trillion dollars in the same period – a drop of 41%.[15]


Finally, let us briefly put some spotlight to the dramatic consequences of climate change. As it is well known today, the capitalist system of production for profit is increasingly destroying the climate. As a result, climate change is a accelerating, posing an increasing danger for humanity. In 2008, 36 million people were displaced by natural disasters. At least 20 million of those people were driven from their homes by disasters related to climate change, like drought and rising sea level. But this was only the beginning: according to different projections, the consequences of climate change will have devastating consequences for many countries and their population. With a global warming of three degrees, twelve countries around the world could lose more than half of their present land area and about 30 countries could lose one tenth of their area. A scientist explains: “If that sea-level rise occurred today, more than 600 million people would be affected and would have to find a new home.[16] Other sources estimate that, “unless strong preventative action is taken, between now and 2050 climate change will push the number of displaced people globally to at least 1 billion.[17]


The Climate Vulnerability Monitor estimates, “that climate change causes 400,000 deaths on average each year today, mainly due to hunger and communicable diseases that affect above all children in developing countries. Our present carbon-intensive energy system and related activities cause an estimated 4.5 million deaths each year linked to air pollution, hazardous occupations and cancer. (…) Continuing today’s patterns of carbon-intensive energy use is estimated, together with climate change, to cause 6 million deaths per year by 2030, close to 700,000 of which would be due to climate change. This implies that a combined climate-carbon crisis is estimated to claim 100 million lives between now and the end of the next decade”. To this human tragedy one has to add the financial costs. According to the OECD “Inflation-adjusted insurance losses from weather-related natural hazard losses have increased from an annual average of around USD 10 billion in the 1980s to around US$50 billion over the past decade.[18]


Concerning future perspectives, the Climate Vulnerability Monitor states: “Climate change caused economic losses estimated close to 1% of global GDP for the year 2010, or 700 billion dollars (2010 PPP). The carbon-intensive economy cost the world another 0.7% of GDP in that year, independent of any climate change losses. Together, carbon economy- and climate change-related losses amounted to over 1.2 trillion dollars in 2010. (…) The world economy therefore faces an increase in pressures that are estimated to lead to more than a doubling in the costs of climate change by 2030 to an estimated 2.5% of global GDP. Carbon economy costs also increase over this same period so that global GDP in 2030 is estimated to be well over 3% lower than it would have been in the absence of climate change and harmful carbon-intensive energy practices.” Most affected by this catastrophe will be those countries which contribute least of all to the climate change – the poor semi-colonial countries. “Least Developed Countries (LDCs) faced on average in excess of 7% of forgone GDP in 2010 due to climate change and the carbon economy, as all faced inequitable access to energy and sustainable development. Over 90% of mortality assessed in this report occurs in developing countries only – more than 98% in the case of climate change[19] (see Figure 9).




Figure 9. Total Deaths and Costs as a Result of Climate Change and the Carbon Economy, 2010 and 2030 [20]






The Dialectical and the Mechanistic Interpretation of Cycles on Capitalism




As we said above, it would be a mechanistic caricature to imagine that the theory of capitalist breakdown implies a gradual decline without any oscillations, without countervailing tendencies, without dialectical leaps, etc.


In fact, the capitalist economy is characterized by business cycle, usually lasting for about 7-10 years. According to Marx, the cycle is divided into several phases that begin with a crisis. This results in a dramatic decline in production followed by stagnation or depression then recovery, prosperity, overheating and, finally, a return to crisis. [21]


However, it would be absolutely wrong to imagine that the long-term, historic development of capitalism proceeds similarly in a cyclical manner, a kind of repetition of ups and downs. We reject such a non-dialectical, simplicistic conception which has become known in the economic literature as the “theory of long waves”. (See on this below)


In fact, since capitalism has entered the epoch of imperialism at the turn to the 20th century it has been marked by a tendency towards decline, resulting in repeated crisis, social catastrophes, mass slaughter of people, world wars, etc. However, within this epoch there are periods of varying tempos and dynamics for the development of the productive forces. Furthermore, as we said above, the ruling capitalist class will not voluntarily abdicate in favor of the working class so that the era of socialism could begin. They fight with all means necessary, including dictatorships, concentration camps and wars of annihilation, to keep their power. As a result, the imperialist rulers have been able to deliver historic defeats to the workers and oppressed and, hereby, allow a temporary delay of the declining tendency of theirs system. The devastating consequences of World War II – both materially as well as politically – and the sell-out of the revolutionary developments in its aftermath resulted in historic defeats of the working class, the establishment of the US’s absolute political, economic and military hegemony in the imperialist camp, and the reactionary Yalta agreement between the victorious imperialist powers and the Stalinist bureaucracy. These were the preconditions for a period of upswing (the so-called “long boom” of the 1950s and 1960s) – an exceptional period in the imperialist epoch (which confused and disorientated most Marxists at that time). [22]


To a much lesser degree we observed a certain transitional period with reactionary features in the 1990s (particularly in the first half of this decade) as a result of the collapse of the degenerated Stalinist workers states and the consequent ideological setbacks of the apparent victory of capitalism in 1989-91.


However, such a countervailing dynamic could only last temporary and was unable to remove the fundamental inner contradictions of the capitalist system. As a result, such periods inevitable ended with a political explosion and the opening of a new period marked by crisis and aggravated class struggles (e.g. the period after 1968, Vietnam War; or the period after 9-11 and the beginning of the imperialist “war on terror” in 2001).


Both economic as well as political cycles can only be adequately understood only if they are put into the context of the historic period in which they take place. Abram Deborin, the leading Soviet philosopher of the 1920s, once remarked that it is obligatory for any Marxist analysis to separate the primary factors from the secondary and “to assess, above all, the general direction of the development”. [23]


Indeed, the historic epoch determines the general line of a given period, its fundamental dynamic. For this reasons, the “cyclical” nature of capitalism must not be interpreted in a mechanistic way as a kind of repetition. Contrary to the schematic views of various pseudo-Marxist intellectuals, this does not mean that the capitalist economy, or the class society in general, is in a kind of constant equilibrium which is only briefly interrupted by crisis but soon restored. Nothing would be further from the truth!


In a remarkable article, written in 1923, Trotsky elaborated very insightful observations about the relationship of long-term, historic epochs or periods and short-term periods or phases.


But capitalism is not characterized solely by the periodic recurrence of cycles - otherwise what would occur would be a complex repetition and not dynamic development. Trade-industrial cycles are of different character in different periods. The chief difference between them is determined by quantitative interrelations between the crisis and the boom period within each given cycle. If the boom restores with a surplus the destruction or constriction during the preceding crisis, then capitalist development moves upward. If the crisis, which signals destruction, or at all events contraction of productive forces, surpasses in its intensity the corresponding boom, then we get as a result a decline in economy. Finally, if the crisis and boom approximate each other in force, then we get a temporary and stagnating equilibrium in economy. This is the schema in the rough.


We observe in history that homogeneous cycles are grouped in a series. Entire epochs of capitalist development exist when a number of cycles is characterized by sharply delineated booms and weak, short-lived crises. As a result we have a sharply rising movement of the basic curve of capitalist development. There are epochs of stagnation when this curve, while passing through partial cyclical oscillations, remains on approximately the same level for decades. And finally, during certain historical periods the basic curve, while passing as always through cyclical oscillations, dips downward as a whole, signalling the decline of productive forces.


It is already possible to postulate a priori that epochs of energetic capitalist development must possess features - in politics, in law, in philosophy, in poetry - sharply different from those in the epochs of stagnation or economic decline. Still more, a transition from one epoch of this kind to a different one must naturally produce the greatest convulsions in the relationships between classes and between states. At the Third World Congress of the Comintern we had to stress this point in the struggle against the purely mechanistic conception of capitalist disintegration now in progress.


If periodic replacements of 'normal' booms by 'normal' crises find their reflection in all spheres of social life, then a transition from an entire boom epoch to one of decline, or vice versa, engenders the greatest historical disturbances; and it is not hard to show that in many cases revolutions and wars straddle the border-line between two different epochs of economic development, i.e., the junction of two different segments of the capitalist curve. To analyse all of modern history from this standpoint is truly one of the most gratifying tasks of dialectical materialism.[24]




Diagram 1: Leon Trotsky’s ‘Curve of Capitalist Development’ written in 1923 [25]






Let us now deal with the arguments and counterarguments which have been put forward by the comrades of PO.


[1] See Michael Pröbsting: Building the Revolutionary Party in Theory and Practice. p. 101,

[2] Leon Trotsky: Report on the World Economic Crisis and the New Tasks of the Communist International (1921), in: Leon Trotsky: The First Five Years of the Communist International, Vol. I, 1924, New Park, London 1973, pp. 264-65,

[3] RCIT: World Perspectives 2017: The Struggle against the Reactionary Offensive in the Era of Trumpism. Theses on the World Situation, the Perspectives for Class Struggle and the Tasks of Revolutionaries, 18 December 2016; Revolutionary Communism No. 59 (January 2017), p. 6 (Thesis 14),

[4] Leon Trotsky: The Third International After Lenin. The Draft Program of the Communist International: A Criticism of Fundamentals (1928), Pathfinder Press, New York 1970, pp. 81-82, Trotsky continues in the subsequent paragraphs of this quote with the following elaboration:

What did we have in Europe in the course of the last decades before the war? In the sphere of economy -- a mighty advance of productive forces with "normal" fluctuations of the conjuncture. In politics -- the growth of social democracy at the expense of liberalism and "democracy" with quite insignificant fluctuations. In other words, a process of systematic intensification of economic and political contradictions, and in this sense, the creation of the prerequisites for the proletarian revolution.

What have we in Europe in the post-war period? In economy -- irregular, spasmodic curtailments and expansions of production, which gravitate in general around the pre-war level despite great technical successes in certain branches of industry. In politics -- frenzied oscillations of the political situation towards the Left and towards the Right. It is quite apparent that the sharp turns in the political situation in the course of one, two, or three years are not brought about by any changes in the basic economic factors, but by causes and impulses of a purely superstructural character, thereby indicating the extreme instability of the entire system, the foundation of which is corroded by irreconcilable contradictions.

[5] Leon Trotsky: Report on the World Economic Crisis and the New Tasks of the Communist International (1921), in: Leon Trotsky: The First Five Years of the Communist International, Vol. I, 1924, New Park, London 1973, p. 226,

[6] Dario Caldaray Matteo Iacovielloz: Measuring Geopolitical Risk, Board of Governors of the Federal Reserve System, January 10, 2018

[7] Michael Pröbsting: World Perspectives 2018: A World Pregnant with Wars and Popular Uprisings. Theses on the World Situation, the Perspectives for Class Struggle and the Tasks of Revolutionaries, Vienna 2018,

[8] See the relevant chapters on the world economy in the World Perspective documents mentioned above.

[9] Leon Podkaminer: Has Trade Been Driving Global Economic Growth, The Vienna Institute for International Economic Studies, Working Paper 131 (2016), p. 3

[10] OECD: The Future of Productivity, Paris 2015, p. 16

[11] Michael Heise, Arne Holzhausen, Rolf Schneider: The productivity slump in the advanced economies: Explanations and need for action, Allianz Working Paper 194, 24.11.2015, p. 15

[12] Economic Report of the President, January 2017, Washington, p. 105

[13] Tyler Durden: Global Debt Hits Record $233 Trillion, Up $16Tn In 9 Months, 01/07/2018,

[14] Amina Mohammed: Deepening income inequality; in: World Economic Forum: Outlook on the Global Agenda 2015, p. 10.

[15] OXFAM: An Economy For The 1%. How privilege and power in the economy drive extreme inequality and how this can be stopped, Oxfam Briefing Paper, 18 January 2016

[17] A Christian Aid: Human tide: the real migration crisis, May 2007, p. 22

[18] OECD: Economic Outlook, Vol. 98 (2015/2), p.69

[19] DARA and the Climate Vulnerable Forum: Climate Vulnerability Monitor 2nd Edition. A Guide to the Cold Calculus of a Hot Planet, Madrid 2012, pp. 17–18

[20] DARA and the Climate Vulnerable Forum: Climate Vulnerability Monitor 2nd Edition. A Guide to the Cold Calculus of a Hot Planet, Madrid 2012, p. 16

[21] See Karl Marx: Capital. A Critique of Political Economy, Volume III, in: MECW Vol. 37, pp. 358, In Volume I of Capital Marx describes the development of the cycle in the following way: „ periods of average activity, production at high pressure, crisis and stagnation“ (Karl Marx: Capital. A Critique of Political Economy, Volume I, in: MECW Vol. 35, p. 627; We have summarized the laws of the business cycle in the first chapter of Michael Pröbsting: World economy – heading to a new upswing? published in Fifth International, Volume 3, No. 3, Autumn 2009,

[22] Ernest Mandel, for example, stated in 1968 that “neo-capitalism” was historically “a third stage in capitalism’s development” after the second stage of monopoly capitalism (see Ernest Mandel: Workers Under Neocapitalism, International Socialist Review, November-December 1968, Unsurprisingly, when capitalism entered again a period of crisis in the 1970s he would drop this thesis on the quiet.

In this context we want to repeat our historical assessment of Ernest Mandel which we summarized somewhere else. Playing a central and highly progressive role in the leadership of the Fourth International during the Second World War and at its end, Mandel later became the central theoretician of the biggest split product of the Fourth International after its centrist degeneration in 1948-51 – called the “International Secretariat” and after 1963 the “United Secretariat of the Fourth International”. As a side note we remark that he had, without doubt, not only huge political failures but he also made important mistakes in his attempt to develop the Marxist economic theory. In addition to his thesis of new epoch after monopoly capitalism, mentioned above, one has to draw attention to his affirmative interpretation of the un-dialectical, objectivist theory of the “Long Waves” (see below). He became a leading theoretician of centrism, not of revolutionary Marxism. However one has also to recognize the fact, that he developed important insights in economic theory (and not only here) which need to be integrated into Marxism. As a theoretician he was far superior to his centrist competitors like Tony Cliff, Ted Grant or Pierre Lambert who shared his centrist misunderstanding of revolutionary Marxism but lacked his theoretical strength. He was – one could say – the Kautsky of the second half of the 20th century with all his strengths and weaknesses.

[23] Abram Deborin: Lenin als revolutionärer Dialektiker (1925); in: Unter dem Banner des Marxismus, 1. Jahrgang (1925-26), p. 224 (our translation). Abram Deborin was the brilliant and leading figure of the dialectical materialist school in the USSR in the 1920s. Unfortunately while there exist numerous works of this great Marxist philosopher in Russian language and also a considerable amount in German language, the weakness of Marxism in the Anglo-Saxon world in the 1920s has resulted in the situation that hardly anything of his works at that time  has been translated into English language. Some useful quotes and summaries of Deborin’s views in English language can be found in the following books: David Joravsky: Soviet Marxism and Natural Science 1917-1932, Routledge, New York 1961/2009; David Bakhurst: Consciousness and Revolution in Soviet philosophy: From the Bolsheviks to Evald Ilyenkov, Cambridge University Press, Cambridge 1991; Helena Sheehan: Marxism and the Philosophy of Science, Humanities Press International, New Jersey 1985.

[24] Leon Trotsky: The Curve of Capitalist Development (1923), in: Leon Trotsky: Problems of Everyday Life, Pathfinder Press, New York 1994, pp. 275-276

[25] Leon Trotsky: Problems of Everyday Life, p. 278; we have taken this graph from the US-Trotskyists’ theoretical journal Fourth International, Vol. 2, No. 4 (May 1941), p. 113, which can be found on the website