Rediscovering Rosa Luxemburg.

AuthorBlackwater, Bill
PositionESSAYS

In the light of post-crisis developments in the political economy of financialisation, credit, and the money supply, Rosa Luxemburg's critique of capitalism deserves to be looked at afresh.

'I was, I am, I shall be!'

Rosa Luxemburg, 'Order reigns in Berlin', 1919. Her last written words.

Rosa Luxemburg's name lives on among left-wingers--but while she is remembered as a hero, her ideas about the intrinsic unsustainability of capitalism have been consistently misunderstood and neglected. This has begun to change recently, with reappraisals of her thought seeing her as a forerunner of contemporary understandings of the role of credit in economic growth. This renewed understanding of her ideas makes her highly relevant to current debates about the role of credit in the financial crash of 2008 and ongoing stagnation which has followed in its wake. But these reappraisals can go further. So far they have focused on showing how, according to Luxemburg's ideas, credit is required in order to make growth possible; what they have not focused on is how her ideas show that such growth cannot go on forever.

Luxemburg the woman

Born in Poland in 1871, Rosa Luxemburg became a leading figure within Germany's social democratic party, the SPD. Her central contribution to political debate was to take issue with those among the SPD's leaders who believed in working for practical gains within the capitalist system, rather than actively organising for its replacement. Her opposition to this reformism was founded on her analysis of the internal contradictions within capitalism: these doomed it to a collapse, she believed, which would in the process cause immense destruction. This led her to pose two great questions for which she is famous: 'socialism or barbarism?' and 'reform or revolution?' Her argument was that a mild policy of attempting to reform capitalism from within would leave its internal contradictions untouched, meaning whatever practical gains were made by workers in the short term would be blown away as capitalism degenerated towards its implosion. Unless there were to be a revolution which proactively replaced capitalism with socialism, the natural completion of capitalism's life-cycle--by which the system gobbled up more and more of the globe, and nations fought each other for the sources of growth until all were exhausted--would have devastating consequences for civilisation.

There is an enduring interest in Rosa Luxemburg, but one hesitates to call it an influence. For decades she has been remembered more for who she was than what she thought. She is admired as a fearless trailblazer for her sex, who took on a party establishment dominated by men, and met condescension with biting sarcasm. She is celebrated for her role within the Second International, the global alliance of socialist parties whom she sought unsuccessfully to unite in opposition to the First World War. She is admired for her equal commitment to democracy and socialism, which saw her oppose the party dictatorship Lenin created in Russia. She is admired, above all, for her courage, moral and physical; her martyrdom. In 1915, shortly before being imprisoned for her opposition to Germany's involvement in the First World War, Luxemburg co-founded the Spartacus League, which would subsequently become the German communist party. In 1919, after an uprising by Spartacus supporters was put down by the authorities, Luxemburg was arrested, then beaten and shot dead while in custody, her body tossed into a canal.

This biography has consistently overshadowed her legacy as a thinker. The tone was set by Lenin, who argued that, even though she had been wrong on all the important debates she had participated in, still she was a hero. Or as he put it, in the ultimate in backhanded compliments: 'An eagle can sometimes fly lower than a chicken, but a chicken can never rise to the same heights as an eagle' (Evenitsky, 1966, 45).

Why is it that her ideas have been largely overlooked? It is not just that they have been overshadowed by the compelling narrative of her life-story. On one side, the centre-left has marginalised her as a revolutionary communist, thus rejecting her ideas as being necessarily misguided. At the opposite pole, for years the Soviet authorities denounced her for having criticised the Leninist approach to power, 'Luxemburgism' becoming a term used to describe those who showed an heretical tendency to think they knew better than the Party. As the intellectual authority of Soviet communism dwindled among Western Marxists, such character assassination later rebounded to her favour. But still, this tended to lead to a celebration of her character rather than a rediscovery of her theory of capitalist breakdown (1).

Rediscovering Luxemburg's ideas

To treat Luxemburg the woman with the proper respect ought to mean engaging seriously with Luxemburg the thinker--this is only what she would have demanded, after all. But at last there are signs today that her ideas are ripe for rediscovery. There is something about the times we live in that makes a widely-understood rediscovery of her thought both possible and necessary.

There are three factors for discussion here. The first is the present context of economic crisis and environmental danger. The capitalist system has not been so obviously dysfunctional since the Great Depression. For decades inequality has been worsening, the real incomes of workers declining, growth in productivity receding, work-life balance getting worse. Dependence on consumer credit partly masked these flaws, but now, following the financial crash of 2008 which this helped create, capitalist economies as a whole have become mired in a condition of chronic stagnation. Meanwhile, there is now a highly-developed scientific understanding that 'business as usual' capitalism will lead to environmental disaster. In 2013, for instance, the Intergovernmental Panel on Climate Change pronounced with greater certainty than ever before that humanity was largely to blame for global warming, and that it was likely there would be a range of serious impacts over the coming decades (Intergovernmental Panel on Climate Change, 2013, 2, 15, 17-25).

It is this which makes understanding Luxemburg's argument, that capitalism is inherently unsustainable, necessary in the most obvious sense. It is necessary in the sense that people must take action to fundamentally change the social system if we are to avert a global catastrophe. But it is also necessary in another sense, that of being instrumental in helping to liberate mainstream debate from the 'tyranny of the present'--the background assumption since the fall of the Berlin Wall that history is over and capitalism triumphant until the end of time.

This is to say, there remains an unwillingness to make fundamental criticisms of capitalism as a system, even among many left-wingers and environmentalists. To talk about capitalism as having an end is nowadays, in any mainstream media, to sound gauche, adolescent, a touching relic of a bygone past. Even to name 'capitalism' as a subject for criticism is to exile oneself to the political margins, presupposing as this does that capitalism is something that can be viewed from the outside--as one of a historical succession of social systems--rather than the way things are.

A vivid illustration of this mentality was given by the left-liberal Richard Reeves, in a 2007 article entitled 'We love capitalism'. Writing for the New Statesman, he began:

Karl Marx famously predicted that capitalism would produce its own gravediggers. If so, they have been an awfully long time on the job. (Perhaps they knock off early). In fact, there is no grave...

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