Kalyan Sanyal, Rethinking Capitalist Development: Primitive Accumulation, Governmentality & Post-Colonial Capitalism, Routledge, 2007. Hbk, pbk
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Kalyan Sanyal’s Rethinking Capitalist Development is as eccentric a book as you could find, and it is completely wrong in all its major arguments. But it has been and is influential, and the reasons for its wrongheadedness and its influence are instructive. Sanyal argues, as he summarises it towards the end of the book, that the idea of development as ‘planning for accumulation’ gave way in the 1970s to a focus on the promotion of welfare through direct intervention in what was a project of ‘legitimizing capital’s existence by resorting to a reversal of primitive accumulation for providing entitlements to the dispossessed’. And he goes on to say:
‘I will now claim that the development discourse in this era of capital is reorganizing itself entirely in relation to the world of the dispossessed produced by capitalist accumulation, and now it is governmentality in a form that is far more complex, with far greater material effectivity, than before. Its goal is to constitute an economic space outside and alongside capital, for its castaways, rather than to create entitlements for them through redistribution of income. Development is very much alive and kicking; only instead of identifying itself with capital, it now seeks to create the conditions of existence of the latter on the basis of an agenda of its own. What it is engaged in is the management of poverty—although couched in terms of the now fashionable “development management”—in a far more elaborate and complex way than in the 1970s and 80s’ (191, emphasis mine).
How does Sanyal reach this bizarre conclusion, and on what evidence can it possibly be based?
He challenges the notion that the system that has triumphed in the 'new order' is capitalism, understood in the dominant discourse as a system organized by market forces that work beyond the frontiers of nations, and based on the institution of private property: capitalism as a system is said to rest on private property rights over economic resources (2).
'What is striking in the current representation is that it equates capitalism with market and private property while capitalism traditionally has been defined as a specific mode of production. Private property and the market are both requirements for capitalism, but they alone do not make a system capitalistic. The market can exist in the presence of a variety of non-capitalist modes of production. Indeed the institution of market has a history that is much longer than the history of capitalism—it has coexisted, albeit in less than perfect form, with pre-capitalist forms of production such as slavery and feudalism. The market is capable of accommodating much more than only the capitalist mode of production. Therefore, equating capitalism with market means keeping out of sight the specificity of capitalism. Neither does the institution of private property, combined with market, make the system necessarily capitalistic. A producer who owns the means of production and produces for the market is neither a capitalist producer nor a wageworker. One can imagine an economy populated solely by such self-employed direct producers engaged in production for the market. Here we have commodity production with private property, yet it is not capitalist production. For, the latter rests not on the existence of private property per se, but on a specific structure of property, i.e., a specific distribution of ownership. In capitalist production, workers, bereft of means of production, sell their labor power for wages and enter into the labor process. The capitalist who has ownership rights over the means of production controls the labor process, and the extracted surplus in the form of profits is used for accumulation. While capitalist production, defined thus, implies the existence of both private property and market, the converse is not true: the combination of the market and private property does not rule out non-capitalist production' (3).
Why then, he asks, 'is capitalism being allowed to appropriate the entire developmental effectivity of that process and, by implication, ruling out the possibility of the same process nurturing and fostering non-capitalist production as a vehicle of development' (ibid). And he answers, evoking Gibson-Graham (1996) that it is the result of 'a social representation that sees capitalism as the dominant form of the economy' (4), and one that is bound to establish itself on a global scale:
‘The economic formation in the third world is traditionally seen as marked by the presence of both capitalist and pre-capitalist forms of production, but always implicit in the characterization of this formation is a presumed superiority of capitalist production in terms of its inherent strength and dynamism. In the course of development, the capitalist sector is seen as the motor of the development process, a sector that expands its domain ultimately bringing the entire economic space within its own ambit, leading to the dissolution of all other forms of production’ (ibid).
JK Gibson-Graham 1996. [Who argue that it is the discourse that keeps capital hegemonic and devalues/hides non-capitalist production]. So, ‘while the process of globalization entails an assault on the non-capitalist economy through commodification and proletarianization, it simultaneously creates conditions within which non-capitalist forms of production can emerge and flourish’ (5). He does not agree:
‘For her, dominance necessarily takes the form of a monolith that annihilates, suppresses, and silences the “others”. And by shattering the monolith, the “others” can be reinvigorated, rehabilitated and posited in radical opposition to the “hegemon”. But, can’t we see hegemony in its complex form in which dominance works through resuscitation rather than asphyxiation, exclusion rather than subsumption, valorization rather than demotion of the “others”? In which the “others” are brought to light and allowed a voice, rather than suppressed and silenced? … Shouldn’t we explore the possibility that they exist as an integral part of a complex hegemonic order?’ (6).
‘Instead of arguing that the presence of multiple forms of production in a market economy challenges capitalism’s hegemony, I want to further problematize the very concept of capitalism by asking: Isn’t it possible to see capitalism as necessarily a complex of capitalist and non-capitalist production residing in the commodity space? In other words, can’t we see capitalist development as process that necessarily produces, brings into existence, non-capitalist economic processes in its own course?’ (7)
‘I begin by recognizing that it is economic heterogeneity that constitutes capitalism within which capital, as a specific relation of production, exists, and then ask whether that heterogeneity itself can be seen as an expression of capital’s hegemony’ (7).
So he rejects the ‘vision of capitalism as a force that destroys the non-capitalist economy’, or the idea that the continued existence of pre-capitalist modes of production is a sign of capitalism’s failure to transform the entire economy’ (7).
‘While Gibson-Graham confronts capitalism’s hegemony to revive economic difference, I problematize the supposedly “non-hegemonic capitalism” of the third world to explore if economic heterogeneity can be interpreted as a complex hegemonic order’ (7-8).
‘Capitalist (under)development: Tales told by Marxists’, 8-26
‘From the very beginning, the Marxist approach to the question of capitalist (under)development in the third world has been caught up in a dilemma. In order to have a theoretical understanding of the economic formation in the third world, it has recognized the need to eschew the orthodox vision of capitalist development as part of a unilineal process of history. But at the same time, it has been reluctant to radically break with the historical materialist framework in which the process of history is seen as the change from a backward mode of production to a more advanced one, driven by the conflicts between forces and relations of production. The theorization of the economic formation in the third world has thus remained implicitly anchored in the paradigm of historical materialism. As the paradigm privileges the orthodox vision that capitalism develops along an inexorable, unidirectional trajectory of historical change, this anchoring ultimately frustrated all attempts to conceptualize the third world capitalism as capitalism of a different kind with a dynamics of its own. The literature on the third world that emerged in the 1960s and 1970s is best seen as a series of failed attempts to cope with this dilemma’ (8)
And ft 1, 41-2 outlines a determinist account of unilinear direction, contradiction between forces and relations of production. But he moves very quickly to dependency and world systems theory. Frank. Wallerstein. Brenner. Exchange v. capitalist class relations and class struggle. Articulation of modes of production. ‘But the question is why do the pre-capitalist modes continue to exist in the presence of the capitalist mode? Why does the latter not expand and lead to the dissolution of the earlier modes as suggested by the historical materialist process? In other words, what are the conditions of existence of this indissoluble unity?’ (15). Three different positions. Dominance of merchant capital (15-18) – Geoffrey Kay on tendency of merchant capital to undermine pre-capitalist conditions of existence, except in Third World., where it sought to preserve earlier modes of production and confine itself to circulation. But, Sanyal asks, why does transformation get blocked in this way? There is a view that articulation of capitalist and pre-capitalist modes is ‘merely a transitional phenomenon’ (18). Warren. Imperialist penetration (19-20): Amin, Taylor. Selective in its interest only in raw materials, and market for luxury goods. But doesn’t explain ISI etc. Capital’s need (20-26). Meillassoux, Rey, Wolpe – ‘According to this view, the pre-capitalist modes continue to exist because they fulfil crucial needs of capital and ensure its conditions of existence. Capitalist production requires supply of cheap labor power and raw materials, and capital typically is unable to secure the entire requirement. It is the pre-capitalist sectors that ensure the conditions of existence of capital by acting as sources of cheap labor and raw materials’ (20).
‘Both Meillassoux and Wolpe base their analysis on African case studies. What they observe in Africa is that there is a domestic subsistence sector acting as a source of cheap labor power to the capitalist plantation and mining sectors. Since part of his subsistence consumption is provided by the subsistence sector, the worker is in a position to work in the capitalist sector for a wage rate that is less than what it otherwise would have been. The wage he receives in the capitalist sector only supplements the “social wage” he is entitled to in the village economy. While the subsistence needs are met by this entitlement, the supplementary cash wage-income from the capitalist sector is used to meet cash obligations such as payment of taxes and purchase of goods produced in the capitalist sector. Thus, the subsistent village economy bears a part of the cost of reproducing labor power, and that enables the capitalist sector to use labor power without having to pay its full reproduction cost. In other words, the pre-capitalist sector implicitly subsidizes capitalist production’ (20-21).
So, ‘the pre-capitalist sectors serve “capital’s need” as supplier of labor and raw materials’ 21. So capital tries to bolster them. Cf. Luxemburg (who was wrong on this) – capitalist sector needs non-cap sector to purchase its surplus goods.
NB:
‘What the structuralist does present is a static picture of the articulation in which the pre-capitalist modes are seen to be serving the economic needs of capital. But how is the dynamics of the articulation to be characterized? Is it only a synchronic relation? Can it reproduce it- self over time? Once we address these questions, the weakness of the structuralist explanation becomes apparent. The capitalist mode of production, defined as extraction of surplus value from wage-labor for accumulation, is essentially a system of expanded reproduction. The surplus value is transformed into new capital resulting in a continuously expanding production base. If the pre-capitalist sectors exist as a source of cheap raw material and labor power, it must then be increasingly difficult for them to cater to the needs of an expanding capitalist production system. In a dynamic context, the capitalist sector, therefore, cannot afford to depend on a stagnant pre-capitalist sector for fulfilling its (economic) conditions of existence; it must fulfill those conditions within itself. Whether it is cheap raw material, as in Rey, or cheap wage goods, as in Meillessoux and Wolpe, the process of accumulation of capital requires that they be eventually produced within the capitalist sector as a part of the process of expanded reproduction. And it is only then that capital becomes self-subsistent in the sense that it is in a position to ensure its own (economic) conditions of existence. Thus, in a particular stage of capital’s emergence as a mode of production, the pre-capitalist sectors may serve capital’s need, and capital may have an incentive to preserve the earlier modes, but the dynamic of accumulation weighs heavily against it and necessitates the ultimate dissolution of those other modes. The articulation that rests on capital’s need is therefore contingent and transitory—it cannot be reproduced in the face of expanded reproduction of cap- ital. In other words, there cannot be a dynamic theory of articulation based on capital’s need’ (23-4).
‘Rey in fact argues this in three-stage process, explicitly making articulation a temporary stage.
I would argue that the structuralists do not have a choice in this regard. The economic logic of capital has implicit in it the inevitability of a full-scale transition’ (24). But he makes this point to say that their analysis must be wrong, not that he accepts the case for the inevitability of full-scale transition: ‘The logic of articulation of capital and its outside, pre-capital, therefore cannot be found in the capitalist economic alone; we must look for it elsewhere, in the realm of the other instances: the political and the ideological/cultural’ (25).
‘Class, Power and Hegemony: The Neo-Gramscian Perspective’, 27-38
Passive revolution. Ideas developed in India by Chaudhury, looking at ‘how capital copes with and negotiates the pre-capitalist institutions in order to carry out the process of accumulation’ (32):
‘Passive revolution offers the theoretical framework within which these strategic maneuvers of capital vis-à-vis the pre-capitalist forces can be captured, and it is these maneuvers that constitute the situation of post-colonial capitalism. And this is a story of success, not failure, in which capital succeeds in creating the conditions for accumulation despite the presence of pre-capital’ (32).
This gives rise to a ‘narrative of the Indian post-colonial capital’.
‘The neo-Gramscian approach characterized the nationalist movement against the colonial power as a case of passive revolution in which the Indian bourgeoisie entered into a series of alliances with other pre-capitalist dominant classes, and under the leadership of this alliances mass support from the subordinate classes was mobilized. Such alliances were necessary because the bourgeoisie did not represent the national–popular and therefore was unable to launch an attack on its own against the colonial rule to found a modern nation state that would ensure the conditions for expanded reproduction of capital. In the post-colonial situation, the nation is reified in the body of the state, and the bourgeoisie is able to establish its dominance only by coming to terms with the other constituents of the nation to construct a hegemonic order that is necessarily complex. Therefore, instead of undertaking a full- scale assault on the pre-capitalist dominant classes, it seeks “to limit their former power, neutralize them where necessary, attack them only selectively, and in general bring them round to a position of subsidiary allies within a reformed state structure.”(Chatterjee 1993: 212) The hegemony in this case does not reflect capital’s dominance in “civil society”; it is a complex hegemony that includes both civil society and the pre-capitalist community with the nation as the surrogate synthesis reified in the body of the state’ (33).
‘In post-colonial India, according to the neo-Gramscian argument, representative democracy severely limits the use of the kind of coercive power that has been used in the Western European case, thus ruling out the possibility of destruction of the pre-capitalist subsistence production through the process of primitive accumulation. On the contrary, “...the ideological construct of the ‘passive revolution of capital’ consciously sought to incorporate within the frame- work of its rule... the entire structures of pre-capitalist community taken in their existent forms.” And “in the economic field, the form preferred was that of ‘community development’ in which the benefits of plan projects, meant for the countryside, was supposed to be shared collectively by the whole community.”(Chatterjee 1993: 213). The result is the continued presence of pre-capital along with a growing modern (capitalist) sector’ (34)
Summing up the general approach in the neo-Gramscian literature:
[But presumably this is transitional]
This is a political strategy, not a recognition of the ‘needs of capital’; and not caused by imperialism: ‘The process of legitimization that the neo-Gramscians refer to is a process internal to the nation: it involves capital, pre-capital, and the nation state’ (35). And ISI strategy fails to produce a fully-fledged capitalist transformation. But Neo-G approach is marked by same contradiction as Marxists: ‘The contradiction between the need to characterize capitalism in the periphery as a sui generis with dynamics of its own, and the implicit refusal to break away from the stagist paradigm of historical materialism that reduces the peripheral capitalism to a mere case of failure. … However, full-scale capitalist transformation, i.e. the classical case, as a possibility, remains embedded in the framework as a reference point, in terms of which the case of passive revolution is seen as a deviant one. The analysis thus remains implicitly anchored in the trajectory of capitalist development implied by the framework of historical materialism’ (36).
‘According to [Chatterjee], destruction of the pre-capitalist sectors through the process of primitive accumulation involves extensive use of coercive power, which, in the Indian case, the political framework of representative democracy does not permit. And therefore the state has to preserve and develop the traditional sectors’ (36).
Suggesting that if it had been possible to use coercive power there would have been a full transition.
‘Beyond Gramsci: Breaking with Historicism’, 38-41.
Need to ‘extricate the post-colonial story entirely from the historical materialist framework’ (38):
‘Only then are we in a position to see the post-colonial capitalist development not as the immanent supersession of the earlier contradictions but as a constructed hegemony with a dialectic of its own. This, for sure, is a theoretical task. It calls for a characterization of capitalist development that theoretically rules out the possibility of capital superseding pre-capital. And this is what marks my point of departure from the neo-Gramscian literature. In what follows I shall conceptualize capitalist development as a process that in its own course produces pre-capital. While on the one hand, the process of primitive accumulation, I will argue, leads to the destruction of the pre-capitalist sectors, on the other, it simultaneously produces a space that necessitates the recreation of those sectors. In short, pre- capital’s conditions of existence flow from the internal logic of the expanded reproduction of capital. (This characterization of capitalist development is elaborated in Chapter 2). Seen thus, pre-capital constitutes an internal ‘other’ of capital and the possibility of capital superseding pre-capital becomes a theoretical impossibility. And no synthesis is possible in the form of a full-fledged capitalism and the classical case of capitalist transformation by ‘battering down the Chinese wall’ turns out to be unrealizable even in principle’ (38-9).
First, ‘pre-capital’ becomes ‘non-capital’, and ‘commodity relations integrate capital and non-capital to form the post-colonial economic’. By going beneath the market, ‘we find the complex of capital and non-capital perpetually locked in a relation of contradiction and mutuality’ (39).
Second, ‘the idea that capital produces non-capital allows us to capture the dynamics of the post-colonial capitalism’ (39): ‘Our conceptualization of the post-colonial economic allows for a diachronic account of the capital–non-capital complex in terms of the two-sided process of destruction and creation of non-capital’ (40).
Third: ‘Most important, conceptualized as a complex of capital and non- capital, the narrative of post-colonial capitalism ceases to be a narrative of transition. … The conceptualization of post-colonial capital in terms of this complex amounts to saying that transition in the historicist sense has already occurred and what we have is capitalism with an inherent heterogeneity. Capitalist development in this scenario means not a structural shift from non-capital to capital, but the development of the entire capital–non-capital complex’ (40).
Chapter Two: Ship of Fools
Post-colonial capitalism like Foucault’s ‘ship of fools’ in Madness and Civilization: ‘The ship carrying its insane cargo, drifting from port to port, with the gates of the cities closed and the insane not allowed to disembark, brings to my mind a similar landscape, the post-colonial one, in which a large part of the population, dispossessed and marginalized, wander around in a wasteland created by “capitalist development”’ (45).
‘I attempt to rethink the Marxian concept of primitive accumulation of capital by explicitly considering exclusion and marginalization of surplus labor power as an inescapable moment of capital’s arising, and then conceptualize the post-colonial economic formation as a structural unity of capital and a sub-economy of the marginalized. In other words, my purpose is to inscribe the wasteland of the excluded into the narrative of capital’s coming into being’ (47).
[The question is, what are the developmental dynamics of this ‘structural unity’? Is it stable, and perpetual, or not?].
‘Primitive Accumulation: the Immanent History of Capital’ (47-52)
Describes it, for Marx, as ‘the process through which the initial conditions of the capitalist mode are created’ 48. Quotes Grundrisse, 459. Then: ‘The “capital in arising”, dependent on the “pre-capitalist outside” for its conditions of existence, is not capital as posited by the concept of the capitalist mode of production’, 48, which is fine as far as it goes. Capital once established does not ‘need’ its non-capitalist outside: capital’s need-based articulation theoretically cannot serve as an explanation of the failure of capitalist transformation of the third world’ 49-50. So: ‘What we need to do is to theoretically intervene in the concept of becoming/arising of capital and problematize the notion of self-subsistent capital to further complicate the concept of primitive accumulation as its immanent history’ 51
‘Not Even the Chains of Wage-Slavery: Surplus Labor Power and the Arising of Post-Colonial Capital’ (52-64)
‘In Marx, when the process of arising of capital is finally over—when capital has become and its becoming remains suspended in its being as prehistory—capital is not only self-subsistent but is also the universal mode of production. Universality of capital implies that nothing exists beyond its domain, no outside for it to cope with or relate to, that through the process of primitive accumulation, the pre-capitalist system of production has totally dissolved to create the initial conditions of capital. In other words, the process of capital’s becoming means the dissolution of the earlier modes of production and structures of property relations, but universality of the capitalist mode of production implies that the process of demolition of the old order to create the conditions of capital has left no wreckage.
In characterizing post-colonial capital in terms of the concept of primitive accumulation, it is precisely at this point that I locate my point of departure. I would imagine a scenario in which direct producers are estranged from their means of production, the latter are to make labor more productive, it changes the composition of new investments in favor of the constant part of the capital as opposed to the variable part, leading to a higher organic composition of the newly created capital. At the same time, composition of the existing capital also changes in the same direction due to the tendency to- wards centralization. Thus with accumulation, the variable part of the capital grows at a much lower rate than the overall rate of ac- cumulation, and since it is the variable part of the capital that serves as the basis of employment of labor, the rate of growth of employment falls short of the rate of accumulation. And “it is capitalist accumulation itself that constantly produces and produces in direct ratio of its own energy and extent, a relatively redundant population of laborers, i.e., a population of greater extent than suffices for the average needs of the self expansion of capital, and therefore a surplus population.
The reserve army therefore arises out of the very nature of capitalist accumulation, and the surplus population that constitutes the reserve army resides within rather than outside the domain of the capitalist mode of production. Unemployment and pauperism is the mirror image of employment, and the reserve army is an ex-tension of the active labor force—an appendage that is brought into being and reproduced by the capitalist mode of production itself. And it belongs to the being of self-subsistent capital” (p. 590)’ 52-3.
[This is wrong. Only the surplus population that is produced by the operation of the capitalist mode of production ‘arises out of the very nature of capitalist accumulation’, and so belongs to ‘the being of self-subsistent capital’. Only some of the surplus population is ‘a moment of the capitalist mode itself’.
The argument, anyway, is that capital creates a ‘wasteland’ inhabited by the dispossessed. But what is the relationship between the phenomenon of exclusion and marginalization with the emergence, consolidation, and reproduction of the capitalist mode of production?
‘The theoretical stance I adopt is radically different from this received wisdom of the traditional Marxist political economy. My position derives from the claim that the phenomenon of exclusion as a theoretical category belongs not to the realm of self-subsistent capital but to capital’s arising, its becoming, a process conceptualized in a space that captures the relation between capital and pre-capital. The wasteland of the dispossessed is the result of the process of primitive accumulation and the dispossessed as a theoretical category is excluded from the very space in which class-based exploitation is defined’ 58.
[But at least you would need to discriminate between ‘expelled’ and excluded]. He goes on:
‘The central point is that Marx’s rendition of primitive accumulation as the immanent history of capital does not recognize the existence of this wasteland. After capital comes into its own, it is the universal mode of production, self-constituting and self-reproducing, without, as I said earlier, any outside to cope with or relate to. The silence about the wreckage and debris left by primitive accumulation, the obliteration of the space of the dispossessed from the story of the capitalist mode of production, is a discursive violence. My purpose in this book is to inscribe the wasteland and its shadowy inhabitants into the heart of the becoming of capital to unsettle the smooth, linear trajectory of its immanent history. The repressed has returned, with a vengeance’ 58.
Here is the statement of the argument:
‘What is to be noted is that here Marx defines self-subsistence entirely in terms of the economic requirements, i.e. the requirement of labor power and capital—both constant and variable. The implicit assumption is that when capital’s economic conditions of existence are created and can be reproduced, the political and ideological conditions of existence are automatically ensured. But once we take into account the wasteland and its inhabitants as an outside of capital, the latter ceases to be self-subsistent even though it is capable of creating and reproducing its economic conditions of existence on its own. For its political and ideological conditions of existence, capital is not self-constituting and to secure the legitimation of its existence, it has to address the outside in politico-ideological terms. In other words, capital’s political and ideological conditions of existence require that the dispossessed producers inhabiting the outside be reunited with means of labor so that they can subsist by engaging in economic activities outside the domain of capital. What follows is a process whereby the means of labor are made to flow from the domain of capital to its outside where producers are reunited with the means of pro- duction to engage in non-capitalist production. More specifically, a part of the surplus produced in the capitalist sector is not transformed into new capital but transferred to the surplus population to constitute the conditions of existence of non-capitalist production. While primitive accumulation seeks to transform the means of labor into capital and subsume them within the domain of capitalist relations, this process of transfer is a reverse flow that extricates them from the space of capital and reunites them with labor. I characterize this decapitalization of means of labor as a reversal of primitive accumulation. The result is a need-based economy in which the dispossessed are rehabilitated in non-capitalist production activities; and the rehabilitation, I further argue, is made possible by interventions brought about by the discourse of development’ 59.
This is an ‘imperative of governance’, to be addressed in Chapter 4.
[This is about as mad as you can get – no way capital can do this, so has to resort to the ‘discourse of development’ as the agent].
Except capital is not self-sufficient in its own sphere:
‘The need for legitimation thus necessitates a reversal of primitive accumulation through developmental intervention but creation of a need economy is not the end of the story. The expansionary thrust of capital continues to subvert the need-based economy separating the direct producers from their means of labor and excluding them from the production economy. … It is this simultaneous process of primitive accumulation and its reversal, the process of destruction and recreation of the non-capitalist outside, of dissolution and conservation of the need-based economy that characterizes the arising of capital in the post-colonial context. The need-based economy as a site for non-capitalist activities gets effaced here only to reappear there in the next moment in a double-faced process of obliteration and reconstitution’ 60-61.
The first part of the argument makes sense (but doesn’t go against Marx): primitive accumulation is a ‘continuous and ongoing process that capital is perpetually engaged in’, or ‘an inescapable moment of capital’ 61. But the second part is pure fiction: ‘the post-colonial capital never becomes in the Hegelian sense. On the one hand, it engages in primitive accumulation, invades what lies beyond, usurps the economic space and becomes self-subsistent in so far as its expanded reproduction is concerned. But on the other, its political and ideological conditions of existence, the need for legitimation, demand that it leave a part of the economic space to a non-capitalist need economy—a reversal of primitive accumulation. Like the proverbial Sisyphus, capital is engaged in a task that is never accomplished: its arising is never complete; its universality never fully established; its being is forever postponed. In other words, inscription of the wasteland, in what Marx calls the immanent history of capital, condemns the post-colonial capital to a perpetual state of becoming’ (61) – ingenious, but bonkers. Leads to reassertion that ‘We have to … see post-colonial capitalism as necessarily a complex of capital and a non-capitalist need economy. This, at the same time, extricates the story of post-colonial capital entirely from the historical materialist paradigm and the Hegelian idea of supersession that informs it. For, if capital necessarily exists as a complex of capital and a non-capitalist outside, then the historical materialist trajectory of stages in which capital supersedes pre-capitalist modes becomes totally irrelevant ruling out full-fledged transformation even as a possibility. And this marks our departure from the Gramscian narrative of passive revolution that presents the post-colonial scenario as a case of blocked transition while full transition remains the reference point in relation to which the post-colonial case is seen as a deviant one’ (61-2).
‘For Marx, once capital has arisen, it no longer needs to engage in exchange with any non-capitalist outside for neither labor power nor the means of labor. But the claim that capital is entirely on its own falls through as soon as we bring to the fore the fact that labor power is not reproduced at the site of capitalist production; household as a non-capitalist site exists where the reproduction of labor power takes place. In the Marxian value calculus, the subsistence basket that the worker receives from the capitalist is treated as the value of labor power, i.e., its cost of reproduction. Labor power, however, is reproduced in the household and the process of reproduction involves not only the subsistence basket received as wages but also the labor performed by the members of the household. These include the labor required to transform commodities in the wage-basket into articles of consumption and also affective, emotional labor that goes into rearing the child—the prospective source of labor power. Thus, the household as a site of non-capitalist production is crucial for the expanded reproduction of capital, and capital continues to engage in exchange with a non-capitalist outside. But the Marxian value calculations completely suppress these indispensable production activities undertaken in the household and capital’s claim to self-subsistence and universality is predicated on the act of obliteration of the household from the discourse on capital’ 62-3.
So he claims that ‘Marxian discourse’ ‘posits capital’s universality by adopting a particular representational strategy that denies the existence of the household as an outside of capital’ 63 – sheer nonsense. Sees relation of capital to household as one of extraction/appropriation, v. exclusion of the ‘post-colonial wasteland’: ‘The post-colonial wasteland in contrast is the space of the excluded, a space constituted by people who do not perform, in fact are not given the option to perform any labor for capital’ 63.
[Obviously not true, and the extraction/exclusion contrast belied anyway by shift of household tasks to immigrant labour from the wasteland].
So, straight after highlighting ‘jobs for Nike’ (via McCloskey) he goes on to describe the post-colonial wasteland as ‘the space for the rejected, the marginal’, which unlike the household ‘has no role to play in the creation of the economic conditions of capital’s expanded reproduction’ 63-4.
‘Beyond the Narrative of Transition: The Post-Colonial Economic’ (64-73)
‘The post-colonial economic, in our conceptualization, is constituted by a dual process: on the one hand, the ongoing process of primitive accumulation of capital estranges direct producers from their means of labor, creating a wasteland constituted by the expropriated and dispossessed, and in a parallel process of reversal of primitive accumulation a need economy is created for their rehabilitation’ 64 – this is essentially the whole of his argument.
So the question arises: ‘But what makes this process of rehabilitation possible? Who institutes the need economy? How are its conditions of existence created and reproduced? What are the agencies that converge to ensure the conditions for its reproduction?’ 64.
And the answer is: ‘I see the process of recreation and renewal of need economy as being rooted in a global discourse of development and the agencies produced by that discourse’ 64.
Their aim is the reproduction of the need economy 65. Acute poverty to be eliminated by uniting the dispossessed with the means of labour, ‘that is, by allowing them to have access to productive resources’ 65.
‘What is important is that production activities in the need economy are predominantly non-capitalist, such as self-employment based production, household production with family labor or different forms of collective/communal organizations of production. These non-capitalist forms of production are seen by the development discourse as the appropriate and effective ways of constituting the need economy … development does not see the solution to the problem of poverty necessarily in terms of an overall capitalist transformation; its emphasis rather is on re-energization of traditional non-capitalist institutions and forms of production to be used as effective instruments for achieving the goal set in terms of consumption or standard of living of the marginalized and the dispossessed’ 65.
[I would like to see some evidence]
The need economy is the production of commodities for the market but: ‘instead of immediate consumption of use value, production in the need economy is production of exchange value with the purpose of acquiring the required consumption basket through the mediation of the market’ 70.
[So why don’t primitive accumulation and capitalist development follow?]
‘From the Politics of Transition to the Politics of Exclusion’ 73-80)
NB Garbled endnote 10, pp. 101-2. Sanyal regards the creation of this need economy as a success for the local bourgeoisie (74-5), despite the fact that as a consequence it does not develop as a bourgeoisie.
‘The process of primitive accumulation and its reversal that lies at the heart of the post-colonial economic, I argue, is to be seen as a global process. When post-colonial capital engages in primitive accumulation it does so as an integral part of global capital. The question of legitimation therefore refers to the political conditions of existence of global capital as a whole, and creation of those conditions requires a global management of the wasteland by creating and sustaining a need economy’ 76.
‘Legitimation of global capital— reproduction of its politico-ideological conditions of existence— through poverty management is now a global project to be undertaken, planned, and executed by global developmental organizations and footloose NGOs. In other words, primitive accumulation by global capital produces a wasteland in the third world and legitimation of capital requires the creation and renewal of a need economy through a global discourse of development. [Post-colonial states are now actors in the globally instituted management of poverty only as a vehicle of that discourse]—they are now instruments of global governance’ 77-8.
Section concludes with an overview of Foucault on discourse as a practice.
‘Development as Discourse’ (80-98)
Ferguson 1990. Escobar 1995. As he shows in his summary, Escobar thought the goal of development discourse was Western-style modernity, but it failed. Sanyal doesn’t agree (85-98). He sees a break around early 1970s:
‘It is a shift from the earlier notion of “development as a systemic transition” to one of “development as improvement”. The earlier claim was that development necessarily means a process of capital accumulation through industrialization accompanied by disintegration of pre-capitalist/ premodern economic organizations and social institutions, bursting of the bonds of caste, creed, and race, and their replacement by capitalist/modern economic, cultural, and social institutions. In the early 1970s, this view of development as an all-encompassing, macro- level transformation yielded place to a different notion of development that aimed at meeting the needs of the poor of the third world—needs defined in terms of nutrition, shelter, health, and education—in direct ways that are not necessarily mediated by a program of overall “transformation” of the traditional order’ 88.
Structure of argument – Chapter 3, first moment of complex hegemony process in which the process of development is identified with the process of primitive accumulation of capital; Chapter 4, ‘the legitimation crisis posed by the continued existence of absolute poverty necessitates a de-essentialization of development. The development discourse seeks to reorganize itself and produces a new system of meanings of the economic entities on the basis of need as a new nodal point. By foregrounding concepts such as “basic needs”, the discourse shifts away its focus from capital and thereby distances itself from the notion of development as transition’ 97. Then:
‘The tension between need and accumulation as the two contending nodal points remains at the heart of the development discourse until they both are turned into parts of a new complex totality produced by the market as the master nodal point. With the rise of neo-liberalism, post-colonial capitalist development is now being posited as a market driven process within a system of meanings that can accommodate accumulation and need as two apparently non-contradictory nodal points residing within a single space defined by the market. It signals a regime of capital that requires a need economy inhabited by non-capital to rehabilitate the victims of accumulation. This is the third moment of the discourse, described in Chapter 5, where a complex form of hegemony is discernable within which the reproduction of post-colonial capital, and its dominance, are ensured’ 97-8.
Chapter 3: Accumulation as Development: the Arising of Capital
Making Development Happen (105-110)
Novelty of post-WW2 concept of development as brought about by purposive planning and purged of political content by focus on rational planning, appropriate programming and efficient implementation.
Different Stage but the Same Script (111-3)
Focus on ‘a predetermined, unidirectional trajectory derived from the ex-post, immanent history of capitalist development in the West and its presumed lineality’ 111.
‘Put differently, what lies invisible in the early discourse of development is how the unity of labor with the means of labor within the pre-capitalist system is destroyed and the means of labor are trans- formed into capital, an alien power confronting labor—a narrative so vigorously told by Marx’ (112).
Structure of Primitive Accumulation and the Modalities of Power (113-127)
Marx, Capital I. Quotes inter alia ‘The so-called primitive accumulation is, therefore, nothing else than the historical process of divorcing producers from their means of production’ – which of course implies that as long as there are producers not divorced from their means of production, primitive accumulation continues 117. So does the system of ruling out alternative means of survival discussed 120-27. Ironic that exactly the same strategy still applies, globally, today:
‘Viewing labor not merely in terms of the wealth it produced but in terms of an ethical transcendence actually served to establish the conditions of capitalist production by providing an ideological justification of the coercive methods adopted to turn the dispossessed into wage-laborer for the capitalist system of production. The ideology of work espoused by the bourgeoisie was an integral element of primitive accumulation. The state power in its juridical form, however, was not the only form of power that made primitive accumulation and the emergence of the capitalist mode of production possible. Parallel to the coercive power of the state, a regime of what Foucault calls the “capillary form of power” was at work that sought to discipline the society by subjecting the human body to a network of continuous surveillance at various micro sites: school, hospital, and workshops. It was a non-sovereign, disciplinary power that operated outside the domain of the sovereign–subject relation, and this disciplinary mechanism combined with legislations and juridical controls to form the entire field where power was to be exercised for ensuring the conditions of the emergence of capital and produce “docile bodies” as the source of surplus value’ 124-5.
Perversely, he denies this and insists on the opposite: ‘the notion of development as provision of basic needs involves the deployment of a form of power whose techniques are fundamentally different from the ones that primitive accumulation was based on. It is a different mode of power that does not operate in terms of denial and suppression; it is a power that is productive and creative, it constructs and enlivens subjectivities rather than impede them’ 126.
Inauguration of the Discourse (128-152)
1950s development economics, Nurkse, Rosenstein-Rodan, Hirschman, Leibenstein, Lewis. Focus is on Lewis 1954, ‘a discursive construction with accumulation as nodal point (in the sense of Laclau–Mouffe) that produces the economy as a contingent totality by provisionally fixing the meaning of its instances and places capital and pre-capital in a hierarchy’ 135-6.
Sample statement: ‘The discourse thus organizes the economy as a totality around accumulation by positing the various instances of the economy in terms of their capacity to support and facilitate the accumulation process’ 140.
Critique of Lewis for not factoring in non-farm production in the ‘subsistence’ sector. A very dubious claim follows:
‘Fifty years after Lewis’ work inaugurated the development discourse, a consensus now seems to be emerging that the trajectory of capitalist development envisaged by Lewis has failed miserably to transfer the entire pool of surplus labor to productive employment in the capitalist sector. The international developmental organizations that once embraced the accumulation-centric approach are increasingly recognizing the existence of production activities in the “informal sector” that constitutes an outside of the capitalist sector. ILO’s insistence on the importance of the informal sector as a source of employment and on the need to pro- vide support to it, and World Bank’s concern about non-farm rural employment, are re-inscribing z-goods into the space of development, albeit in a displaced and reconstituted form’ 151.
Industrialization in Post-Colonial India: Planning as the Realm of Reason (152-66)
Shift towards industrialization strategy was relatively slow, over first three five-year plans.
Chapter 4 De-essentializing Development: Capital and Governmentality
Robert McNamara, Nairobi address to Board of Governors of World Bank, 1973, which he says proposed alleviation of direct poverty ‘as a goal distinct from accumulation and growth’, not really true 169. This, he says, was the ‘governmentalization’ of the developmental state 170.
More Foucault – governmentality and the welfare of the population. The turns to the relationship between governmentality and capital, 173-6. Core argument repeated:
The destruction of pre-capital as the necessary condition for capital’s arising was legitimized in the name of progress, but now poverty is integral to capital’s own existence, an “other” that it cannot escape. Development can now claim the legitimacy of capital’s existence only by addressing poverty and deprivation in terms of governmental technologies with the aim of ensuring subsistence to the dispossessed, to the inhabitants of the wasteland that surrounds the world of capital. This requires that a part of the capitalist surplus be transferred from the domain of capital for implementing anti-poverty programs; development now means a reversal of primitive accumulation’ 174
Not consistent with McNamara, I don’t think.
It goes on:
‘Thus there is dispersion within the discourse with its object undergoing transmutation. By shifting the focus from accumulation to eradication of absolute poverty, the discourse distances itself from the capital’s own agenda, and the space of development emerges as a space distinct from the one in which the story of the modes of production and capital is inscribed. Development is no longer synonymous with the project of an overall capitalist transformation of the economy, a project that President Truman’s 1949 speech described as one for which “ancient philosophies have to be scrapped; old social institutions have to disintegrate; bonds of caste, creed and race have to burst”. The primary concern of development now is the “improvement” of the conditions of the poor, who is located outside the domain of capital, with governmental technologies’ 174-5.
Not so. McNamara called for increased small farmer productivity, with property rights, credit, irrigation, obviously intended to eradicate subsistence farming.
Need, Entitlement and Capability: Development as Governmentality 176-84
Not fully developed until Sen in 1980s. Sen 176-9. Robert Ayres as a key source (1983!!). WDR 1980 cited as follows:
‘The World Development Report (1980) of the Bank explicitly recognized that growth might cause dispossession and poverty:
[L]ooking at changes over time within particular countries, the connection between growth and poverty reduction over periods of a decade or two appears inexact. There is a general agreement that growth, in the very long term, eliminates most absolute poverty; but also that some people may (at least temporarily) be impoverished by development—as when a tenant farmer is dis- placed by his landlord’s tractor or a shoemaker by mass-produced shoes. (pp. 35–36)
And it goes on to emphasize the absence of any trade off between growth and the poverty-focused approach:
[T]he connection between economic growth and poverty reduction goes both ways. Few would dispute that health, education, and well-being of the mass of people in industrialized countries are a cause, as well as a result, of national prosperity. Similarly people who are unskilled and sick make little contribution to a country’s economic growth. Development strategies that bypass large number of people may not be the most effective way for developing countries to raise their long-run growth rates. (p. 36)’
And he comments (184) ‘Thus the discourse first produced its own critique of “growth essentialism” and then restructured the space of development on the basis of this auto-critique to posit the eradication of absolute poverty and accumulation as its dual objectives, with profound implications for the post-colonial developmental states’. But the question is, what did it say next?
The Changing Perspective of Development and the Indian Planning, 184-8.
Poverty-eradicating measures introduced in Sixth Plan, 1980. Same argument:
‘Thus, Indian planning assumed a governmental role in order to ensure that it helped in the rise of the political conditions of existence of the post-colonial capital. For almost two-and-a-half decades after the independence it had been engaged in creating the conditions for primitive accumulation; now it was actively engaged in redistributing a part of the surplus generated in the capitalist sector to the poor through anti-poverty programs. And the space of planning was restructured to accommodate the non-capitalist goal of improving the condition of the victims of primitive accumulation’ 187.
At the same time he acknowledges the ‘Green Revolution’ as ‘undoubtedly an attempt to inaugurate capitalist transformation in the Indian agriculture, 187, but claims that:
‘The real change within the realm of planning occurred after the Green Revolution, a change whose profound implications escaped the Indian Marxist. It was the change from the preoccupation with accumulation to the concern about the poor, and with it the emergence of the governmental face of the state. And it is crucial to grasp the importance of this change to arrive at an understanding of the dynamics of post-colonial Indian capitalism’ 188.
Chapter 5 Difference as Hegemony: Capital and the Need Economy
The Theme of Return 189-191
(Zizek) Globalization to a return to 19th century laissez faire, or earlier imperialism. Ironically, he makes this mistake in talking about spread of informalization. ‘I will argue that far from a return to the past, what we are witnessing is the emergence of a capitalism that is radically new in its form of governance and modalities of power’ 190: a new era in which ‘the accumulation-centric vision—we have already characterized it as the first moment of the hegemony process—is fast fading away but it is yielding place to an entirely new imaginary of development, one that is rooted in governmentality rather than in the project of planned primitive accumulation. In the preceding chapter, I argued that there was already a mutation in the notion of development from the 1970s with the focus shifted from accumulation to pro- motion of welfare through direct intervention. It was the project of legitimizing capital’s existence by resorting to a reversal of primitive accumulation for providing entitlements to the dispossessed. I will now claim that the development discourse in this era of capital is reorganizing itself entirely in relation to the world of the dispossessed produced by capitalist accumulation, and now it is governmentality in a form that is far more complex, with far greater material effectivity, than before. Its goal is to constitute an economic space outside and alongside capital, for its castaways, rather than to create entitlements for them through redistribution of income’ 191.
The Challenge of the Slums 192-3
A third of the global urban population live in slums (2001). Davis (2004), surplus humanity. Hence ‘management of poverty’, for which we require to explore the genealogy of the ‘informal sector’.
The Discursive Constitution of the Informal Sector 193-207
‘Informal economy’ focus of ILO attention since 1970s. [See also WDR 1978, 5-6]. His focus is on a paper by Paul Bangasser, 2000, then Harris/Todaro, 1970 on inducement to migrate although jobs are few (wage differential). Data collection from early 1990s, turn of the century recognition of ‘breeding ground for entrepreneurship on a mass scale’ 205. Majority of economically active population. With this discursive shift, there is ‘an important moment of departure in which development is finally extricated from the narrative of transition’, 206.
The Need Economy 208-215
Non-capitalist economic space characterized as a need economy. ‘I see it as an ensemble of economic activities undertaken for the purpose of meeting needs, as distinct from activities driven by an impersonal force of systemic accumulation’ 209.
This is crazy – from the point of view of the worker, the formal sector is just as much a need economy.
Anyway, brings out the dualism of his approach:
‘I call the realm of capitalist production the accumulation-economy and that of informal production the need economy. In the first, production is for accumulation, and in the second, it is for meeting need. They are two distinct economies, two systems, each with an internal logic of its own. While one is driven by the logic of accumulation, production in the other is organized to support a certain level of consumption. Although they both reside in the realm of ex- change and money, their simultaneous presence marks a discontinuity in the space of the market. These two economic spaces together constitute the post-colonial economic, inscribing in it an inescapable dualism’ 212
So simply twists Lewis model by denying the possibility of transition. But NB informal ‘need’ economy includes wage-labour.
‘Empirical studies have reported an immense heterogeneity within the informal economy: these activities take place within a wide variety of informal arrangements and a network of oral contracts and relations of reciprocity. The forms of labor on which they are based are also varied and many: pure self-employment, family labor, communal labor, or even wage-labor and their various combinations. The concept of the need economy encompasses the entire ensemble of these activities because despite the heterogeneity of their forms, they have one common characteristic: they all enable the producer to have access through the market to a consumption basket that will satisfy his need’ 212.
Not quite the same as subsistence economy because it may generate a surplus. But further complicated by the employment of labour in the ‘need’ economy – fatal for his approach. He calls it another complication, but the fact is that the need-accumulation dualism breaks down. Obfuscation 214-5.
Difference as Hegemony: Capital’s Self-Representation in a Globalized World 215-227
Two ‘nodal points’ now – accumulation and need. But completely incoherent again:
‘For example, labor in the first space is the means to produce surplus for investment and accumulation, and the state is an institution for creating the most favourable conditions for the accumulation process. But when seen in relation to the second space, labor is the means to acquire entitlements to consumption through the production of marketable commodities, and the state’s role is to create conditions to ensure these entitlements’ 216.
This looks at labour from the point of view of capital in the first instance, but the worker in the second. Also, ‘the informal sector is described in a positive light with dynamism and innovativeness attributed to it, qualities that promote it to a level where it can be treated at par with the formal sector’ 217.
As diversity and plurality are now promoted and managed by capital in order to legitimise itself, it is wrong to celebrate their presence as a countervailing force 225-6. Rather, ‘in the now prevalent development imaginary, while governmentality, through a reversal of primitive accumulation, activates the need-space by promoting newly formed subjectivities— the self-employed, the z-goods producer, the subsistence producer in a small cooperative—the need economy remains the space of confinement for the dispossessed and castaways of capitalist development. It is a space that prevents them from banging on the doors of the glittering world of capital’ 226.
And micro-credit is the mechanism through which the need economy is created and renewed.
Financing the Need Economy: Governmentality and the Global Management of Policy 228-236
‘A new architecture of development must complement the new global capitalist order, and this new paradigm of development focuses on the management of poverty from a global perspective. More precisely, the creation and renewal of the need economy is now a global process driven by a global discourse’ 228.
Perversely, he follows a series of quotes that clearly indicate the use of micro-credit to bring the poor into the capitalist economy, he presents it as a means of keeping them outside it: ‘We, from our perspective, will interpret the core content of this pro-poor growth strategy as the creation of the need economy. It is a strategy that seeks to reunite the pauperized with the means of labor to constitute an economic space outside the economy that is driven by the logic of accumulation’ 230.
WDR 2002 cited 235. Ch 8 makes exactly the opposite argument; and see also p. 174: reliance on informal institutions alone is not enough for growth of inclusive markets.
Informalization within the Accumulation-Economy 237-42
‘So far, we have described the informal need economy as existing outside the accumulation-economy of capital. We now have to contrast it to a phenomenon that is increasingly being highlighted in the commentary on globalization: informalization of production activities within the circuit of capital—a phenomenon that results from the internal logic of the accumulation economy itself. Studies in the informal sector have emphasized the observation that a part of the sector is deeply implicated in the modern formal economy through various linkages of subcontracting and outsourcing (Sethuraman 1997, Tabak 2000). There is a tendency among development theorists and practitioners to see the informal sector entirely in terms of this embedded-ness and to focus exclusively on these linkages for designing policies. But what is to be emphasized here is that need-based production that resides within and is organically related to the accumulation circuit is very different from the need- economy that exists outside the circuit.33 It is the latter that has been our concern in this book, and it should be emphatically contrasted with the former’ 237.
Putting-out, self-employed sub-contracting, and sub-contractor as informal employer of wage labour.
‘Thus through this dispersion of production on a global level, a part of the informal need economy of the third world finds itself implicated in the circuit of the global accumulation-economy’ 240.
So: ‘The important point here is that we must sharply contrast the need economy that results from developmental governmentality— the one we have described in this book—with informalization within capitalist production described above’ 240.
The Indian Economy Goes Global 242-5
Put together, [the post-1991] reforms significantly altered the structure of the Indian economy in favor of a system driven by the market forces and private entrepreneurship. Although the neo-liberal advocates of reforms complain about the insufficient implementation of the proposed reform package, there is no denying that the Indian economy in the preceding decade-and-a-half has experienced a rupture with the past. The post-colonial regime of economic development through planned accumulation, with the state as its most important agent, has been virtually abandoned to embrace a system in which accumulation is driven entirely by the market forces and the logic of capitalist calculation.
Jobless Growth 245-51
Key section.
‘The growth rate figures however belie a phenomenon that the Indian economy has been experiencing in this period of boom: the growing level of unemployment. The evidence also points to the fact that while the economy is growing steadily in terms of the GDP, its impact in terms of employment generation has been negligible. It is not India alone, the entire developing world—and to a certain extent the developed countries as well—is witnessing this growth–employment paradox’ 245
Same error of analysis as in previous two sections repeated here:
‘In terms of our story, the strategy is one of constituting and fostering the need economy to provide income-entitlements, as the accumulation-economy is incapable of accommodating the surplus labor force. The fact is that the unorganized sector has always been there, providing subsistence to an overwhelming majority of the working population, but the discourse of planning in India never recognized its existence—it was a dark space between the traditional agriculture and the mod- ern industry. The discourse now illuminates this space, “discovers” the unorganized sector and turns it into an object of planned governmentality. The accumulation-economy, driven by the logic of capitalist calculation and the forces of the market, will grow on its own, but at the same time the need economy has to be created, fostered and managed by purposeful planned intervention for providing livelihood to the excluded’ 249.
Insists that the aim is the reproduction of dualism 251: ‘After struggling for half-a-century with this elusive project, the project of post-colonial development is finally coming to terms with the fact that there is a dualism endogenous to post-colonial capital, and the role of the developmental state is to create the conditions within which the two-tier world of capital can be reproduced’.
This account is just as historicist as any other – a permanent settlement based on a stable dualist equilibrium. But at the same time one in which capital continues to penetrate the space of the dispossessed. And one in which some employers of wage labour choose to provide services to global capital as sub-contractors but other employers of wage labour choose not to and do not seek to accumulate.
Conclusion: Towards a New Political Imaginary for the Post-Colonial World
‘The politics of exclusion … unyokes the anti-capitalist political project from the story of transition by envisioning post-colonial capitalism as a complex of capital and a need economy and focuses on the space of the marginal and the dispossessed. Its critique of capital is centered not on the inability of capital to transform pre-capital but on the wasteland of the dispossessed created by the very process of primitive accumulation. The goal of this politics is to politicize development. As we have seen, developmental governmentality posits itself as “politically neutral” practices, the purpose of which is to improve the conditions of the population groups with the help of rational calculations by experts and professionals. The politics of exclusion subjects the depoliticized face of governmentality to a political critique and seeks to posit the terrain of governmentality as a politically contested terrain.
Politicization of the governmental functions of the developmental state and the international organizations means pitting the need economy in radical opposition to the accumulation-economy of capital. The new anti-capitalist politics claims autonomy for the need economy and asserts its demand for resources (means of labor, credit, training, information). Governmentality creates and renews the need economy but at the same time confines it to an “informal” space outside the space of capital. In the complex hegemonic order of capital that I have described, the dominant discourse of development allows capital an autonomy in the sense that the accumulation- economy can expand on its own. The expansion of the accumulation- economy is the result of both capitalist accumulation—creation of new capital with surplus produced within the capitalist production system—and primitive accumulation. As primitive accumulation results in dispossession, development rehabilitates the dispossessed in the need economy. Thus, the need economy remains a passive space that is obliterated and recreated in the course of capital’s autonomous process of expansion, although in the representation of the development process the two are posited as complementary and parallel. The precise goal of the politics of exclusion is to unsettle the dominant regime of representation to bring to light this asymmetry and then to endow the need economy with autonomy that will allow it to posit itself as the radical “other” of capital. In other words, the purpose of the new politics is to liberate need-based production from the informality and spatial fixity that the dominant discourse imposes on it so that it can encroach upon and unsettle the space of capital. … The politics of exclusion aims to resist the invasion of the accumulation-economy into the parallel need economy and to assert the latter’s demand for resources to create the conditions for its expanded reproduction. At the same time, it strives to extricate the implicated part of the need economy from capital’s circuit, to liberate these activities from the grasp of the systemic logic of capitalist accumulation, and unite them with the parallel part of the need economy to constitute a unified economic space where production is grounded in the logic of need’ 255-7.
Once the space of the dispossessed is conceptualized in terms of needs-based production, ‘multiple population groups in political society and their plural struggles can be seen as grounded in the need-economy. Communities that emerge from these struggles, with their various forms of solidarity, can find a common identity in relation to their location in a unified “informal economy”. The politics of the governed then rises above its temporary and contextual nature and is able to posit a radical critique of capital’s accumulation-economy. Governmental technology necessarily presents the social as heterogeneous and the outside of capital is represented in the discourse of welfarist governmentality as fragmented, consisting of multiple population groups. And the precise task of the anti-capitalist politics of exclusion is to ground these fragments in the space of need to produce a unified and stable “other” of capital’ 258.
So in the end he calls for an alliance between workers, those in the ‘need’ economy, and those in the informal economy ‘implicated in the circuit of capital’:
Marx in Grundrisse repeatedly draws our attention to this subjugation of the world of need to the logic of accumulation, to the fact that the worker can perform the necessary labor for his/ her own reproduction only if she/he performs surplus labor for the capitalist. Seen thus, the existence of the direct producers belonging to the three distinct parts of the economy—the need economy that exists outside the domain of capital, the informalized production activities that are implicated in the circuit of capital and the formal capitalist labor process—is grounded in production for the satisfaction of need, and they are all subjected to capital’s dominance although the nature and form dominance is different in each case [sic]. The perspective of need can thus provide a common ground for both the “excluded” and the “included” in their battle against capital.
A radical political agenda for today’s post-colonial world, deeply implicated in a global capitalist order, thus must be rooted in an articulation of these two terrains of politics: the terrain that foregrounds the need economy in radical opposition to the continual and ongoing process of primitive accumulation of global capital, and the one that focuses on class-based exploitation within capital’s own space. It is only by articulating these two realms of politics— instead of reducing one into the other or placing them in a hierarchy—that we can carve out from their criss cross a complex space, a space politically far more fertile than the one defined by class alone; a space in which radically new counter-hegemonic imaginaries, and the contours of strategies and actions to turn those imaginaries into actualities, can be made visible.
Partha Chatterjee, The Nation and Its Fragments, OUP, 1993.
Partha Chatterjee, The Politics of the Governed: Reflections on Popular Politics in Most of the World, Bombay, Permanent Black, 2004.
text
‘I will now claim that the development discourse in this era of capital is reorganizing itself entirely in relation to the world of the dispossessed produced by capitalist accumulation, and now it is governmentality in a form that is far more complex, with far greater material effectivity, than before. Its goal is to constitute an economic space outside and alongside capital, for its castaways, rather than to create entitlements for them through redistribution of income. Development is very much alive and kicking; only instead of identifying itself with capital, it now seeks to create the conditions of existence of the latter on the basis of an agenda of its own. What it is engaged in is the management of poverty—although couched in terms of the now fashionable “development management”—in a far more elaborate and complex way than in the 1970s and 80s’ (191, emphasis mine).
How does Sanyal reach this bizarre conclusion, and on what evidence can it possibly be based?
He challenges the notion that the system that has triumphed in the 'new order' is capitalism, understood in the dominant discourse as a system organized by market forces that work beyond the frontiers of nations, and based on the institution of private property: capitalism as a system is said to rest on private property rights over economic resources (2).
'What is striking in the current representation is that it equates capitalism with market and private property while capitalism traditionally has been defined as a specific mode of production. Private property and the market are both requirements for capitalism, but they alone do not make a system capitalistic. The market can exist in the presence of a variety of non-capitalist modes of production. Indeed the institution of market has a history that is much longer than the history of capitalism—it has coexisted, albeit in less than perfect form, with pre-capitalist forms of production such as slavery and feudalism. The market is capable of accommodating much more than only the capitalist mode of production. Therefore, equating capitalism with market means keeping out of sight the specificity of capitalism. Neither does the institution of private property, combined with market, make the system necessarily capitalistic. A producer who owns the means of production and produces for the market is neither a capitalist producer nor a wageworker. One can imagine an economy populated solely by such self-employed direct producers engaged in production for the market. Here we have commodity production with private property, yet it is not capitalist production. For, the latter rests not on the existence of private property per se, but on a specific structure of property, i.e., a specific distribution of ownership. In capitalist production, workers, bereft of means of production, sell their labor power for wages and enter into the labor process. The capitalist who has ownership rights over the means of production controls the labor process, and the extracted surplus in the form of profits is used for accumulation. While capitalist production, defined thus, implies the existence of both private property and market, the converse is not true: the combination of the market and private property does not rule out non-capitalist production' (3).
Why then, he asks, 'is capitalism being allowed to appropriate the entire developmental effectivity of that process and, by implication, ruling out the possibility of the same process nurturing and fostering non-capitalist production as a vehicle of development' (ibid). And he answers, evoking Gibson-Graham (1996) that it is the result of 'a social representation that sees capitalism as the dominant form of the economy' (4), and one that is bound to establish itself on a global scale:
‘The economic formation in the third world is traditionally seen as marked by the presence of both capitalist and pre-capitalist forms of production, but always implicit in the characterization of this formation is a presumed superiority of capitalist production in terms of its inherent strength and dynamism. In the course of development, the capitalist sector is seen as the motor of the development process, a sector that expands its domain ultimately bringing the entire economic space within its own ambit, leading to the dissolution of all other forms of production’ (ibid).
JK Gibson-Graham 1996. [Who argue that it is the discourse that keeps capital hegemonic and devalues/hides non-capitalist production]. So, ‘while the process of globalization entails an assault on the non-capitalist economy through commodification and proletarianization, it simultaneously creates conditions within which non-capitalist forms of production can emerge and flourish’ (5). He does not agree:
‘For her, dominance necessarily takes the form of a monolith that annihilates, suppresses, and silences the “others”. And by shattering the monolith, the “others” can be reinvigorated, rehabilitated and posited in radical opposition to the “hegemon”. But, can’t we see hegemony in its complex form in which dominance works through resuscitation rather than asphyxiation, exclusion rather than subsumption, valorization rather than demotion of the “others”? In which the “others” are brought to light and allowed a voice, rather than suppressed and silenced? … Shouldn’t we explore the possibility that they exist as an integral part of a complex hegemonic order?’ (6).
‘Instead of arguing that the presence of multiple forms of production in a market economy challenges capitalism’s hegemony, I want to further problematize the very concept of capitalism by asking: Isn’t it possible to see capitalism as necessarily a complex of capitalist and non-capitalist production residing in the commodity space? In other words, can’t we see capitalist development as process that necessarily produces, brings into existence, non-capitalist economic processes in its own course?’ (7)
‘I begin by recognizing that it is economic heterogeneity that constitutes capitalism within which capital, as a specific relation of production, exists, and then ask whether that heterogeneity itself can be seen as an expression of capital’s hegemony’ (7).
So he rejects the ‘vision of capitalism as a force that destroys the non-capitalist economy’, or the idea that the continued existence of pre-capitalist modes of production is a sign of capitalism’s failure to transform the entire economy’ (7).
‘While Gibson-Graham confronts capitalism’s hegemony to revive economic difference, I problematize the supposedly “non-hegemonic capitalism” of the third world to explore if economic heterogeneity can be interpreted as a complex hegemonic order’ (7-8).
‘Capitalist (under)development: Tales told by Marxists’, 8-26
‘From the very beginning, the Marxist approach to the question of capitalist (under)development in the third world has been caught up in a dilemma. In order to have a theoretical understanding of the economic formation in the third world, it has recognized the need to eschew the orthodox vision of capitalist development as part of a unilineal process of history. But at the same time, it has been reluctant to radically break with the historical materialist framework in which the process of history is seen as the change from a backward mode of production to a more advanced one, driven by the conflicts between forces and relations of production. The theorization of the economic formation in the third world has thus remained implicitly anchored in the paradigm of historical materialism. As the paradigm privileges the orthodox vision that capitalism develops along an inexorable, unidirectional trajectory of historical change, this anchoring ultimately frustrated all attempts to conceptualize the third world capitalism as capitalism of a different kind with a dynamics of its own. The literature on the third world that emerged in the 1960s and 1970s is best seen as a series of failed attempts to cope with this dilemma’ (8)
And ft 1, 41-2 outlines a determinist account of unilinear direction, contradiction between forces and relations of production. But he moves very quickly to dependency and world systems theory. Frank. Wallerstein. Brenner. Exchange v. capitalist class relations and class struggle. Articulation of modes of production. ‘But the question is why do the pre-capitalist modes continue to exist in the presence of the capitalist mode? Why does the latter not expand and lead to the dissolution of the earlier modes as suggested by the historical materialist process? In other words, what are the conditions of existence of this indissoluble unity?’ (15). Three different positions. Dominance of merchant capital (15-18) – Geoffrey Kay on tendency of merchant capital to undermine pre-capitalist conditions of existence, except in Third World., where it sought to preserve earlier modes of production and confine itself to circulation. But, Sanyal asks, why does transformation get blocked in this way? There is a view that articulation of capitalist and pre-capitalist modes is ‘merely a transitional phenomenon’ (18). Warren. Imperialist penetration (19-20): Amin, Taylor. Selective in its interest only in raw materials, and market for luxury goods. But doesn’t explain ISI etc. Capital’s need (20-26). Meillassoux, Rey, Wolpe – ‘According to this view, the pre-capitalist modes continue to exist because they fulfil crucial needs of capital and ensure its conditions of existence. Capitalist production requires supply of cheap labor power and raw materials, and capital typically is unable to secure the entire requirement. It is the pre-capitalist sectors that ensure the conditions of existence of capital by acting as sources of cheap labor and raw materials’ (20).
‘Both Meillassoux and Wolpe base their analysis on African case studies. What they observe in Africa is that there is a domestic subsistence sector acting as a source of cheap labor power to the capitalist plantation and mining sectors. Since part of his subsistence consumption is provided by the subsistence sector, the worker is in a position to work in the capitalist sector for a wage rate that is less than what it otherwise would have been. The wage he receives in the capitalist sector only supplements the “social wage” he is entitled to in the village economy. While the subsistence needs are met by this entitlement, the supplementary cash wage-income from the capitalist sector is used to meet cash obligations such as payment of taxes and purchase of goods produced in the capitalist sector. Thus, the subsistent village economy bears a part of the cost of reproducing labor power, and that enables the capitalist sector to use labor power without having to pay its full reproduction cost. In other words, the pre-capitalist sector implicitly subsidizes capitalist production’ (20-21).
So, ‘the pre-capitalist sectors serve “capital’s need” as supplier of labor and raw materials’ 21. So capital tries to bolster them. Cf. Luxemburg (who was wrong on this) – capitalist sector needs non-cap sector to purchase its surplus goods.
NB:
‘What the structuralist does present is a static picture of the articulation in which the pre-capitalist modes are seen to be serving the economic needs of capital. But how is the dynamics of the articulation to be characterized? Is it only a synchronic relation? Can it reproduce it- self over time? Once we address these questions, the weakness of the structuralist explanation becomes apparent. The capitalist mode of production, defined as extraction of surplus value from wage-labor for accumulation, is essentially a system of expanded reproduction. The surplus value is transformed into new capital resulting in a continuously expanding production base. If the pre-capitalist sectors exist as a source of cheap raw material and labor power, it must then be increasingly difficult for them to cater to the needs of an expanding capitalist production system. In a dynamic context, the capitalist sector, therefore, cannot afford to depend on a stagnant pre-capitalist sector for fulfilling its (economic) conditions of existence; it must fulfill those conditions within itself. Whether it is cheap raw material, as in Rey, or cheap wage goods, as in Meillessoux and Wolpe, the process of accumulation of capital requires that they be eventually produced within the capitalist sector as a part of the process of expanded reproduction. And it is only then that capital becomes self-subsistent in the sense that it is in a position to ensure its own (economic) conditions of existence. Thus, in a particular stage of capital’s emergence as a mode of production, the pre-capitalist sectors may serve capital’s need, and capital may have an incentive to preserve the earlier modes, but the dynamic of accumulation weighs heavily against it and necessitates the ultimate dissolution of those other modes. The articulation that rests on capital’s need is therefore contingent and transitory—it cannot be reproduced in the face of expanded reproduction of cap- ital. In other words, there cannot be a dynamic theory of articulation based on capital’s need’ (23-4).
‘Rey in fact argues this in three-stage process, explicitly making articulation a temporary stage.
I would argue that the structuralists do not have a choice in this regard. The economic logic of capital has implicit in it the inevitability of a full-scale transition’ (24). But he makes this point to say that their analysis must be wrong, not that he accepts the case for the inevitability of full-scale transition: ‘The logic of articulation of capital and its outside, pre-capital, therefore cannot be found in the capitalist economic alone; we must look for it elsewhere, in the realm of the other instances: the political and the ideological/cultural’ (25).
‘Class, Power and Hegemony: The Neo-Gramscian Perspective’, 27-38
Passive revolution. Ideas developed in India by Chaudhury, looking at ‘how capital copes with and negotiates the pre-capitalist institutions in order to carry out the process of accumulation’ (32):
‘Passive revolution offers the theoretical framework within which these strategic maneuvers of capital vis-à-vis the pre-capitalist forces can be captured, and it is these maneuvers that constitute the situation of post-colonial capitalism. And this is a story of success, not failure, in which capital succeeds in creating the conditions for accumulation despite the presence of pre-capital’ (32).
This gives rise to a ‘narrative of the Indian post-colonial capital’.
‘The neo-Gramscian approach characterized the nationalist movement against the colonial power as a case of passive revolution in which the Indian bourgeoisie entered into a series of alliances with other pre-capitalist dominant classes, and under the leadership of this alliances mass support from the subordinate classes was mobilized. Such alliances were necessary because the bourgeoisie did not represent the national–popular and therefore was unable to launch an attack on its own against the colonial rule to found a modern nation state that would ensure the conditions for expanded reproduction of capital. In the post-colonial situation, the nation is reified in the body of the state, and the bourgeoisie is able to establish its dominance only by coming to terms with the other constituents of the nation to construct a hegemonic order that is necessarily complex. Therefore, instead of undertaking a full- scale assault on the pre-capitalist dominant classes, it seeks “to limit their former power, neutralize them where necessary, attack them only selectively, and in general bring them round to a position of subsidiary allies within a reformed state structure.”(Chatterjee 1993: 212) The hegemony in this case does not reflect capital’s dominance in “civil society”; it is a complex hegemony that includes both civil society and the pre-capitalist community with the nation as the surrogate synthesis reified in the body of the state’ (33).
‘In post-colonial India, according to the neo-Gramscian argument, representative democracy severely limits the use of the kind of coercive power that has been used in the Western European case, thus ruling out the possibility of destruction of the pre-capitalist subsistence production through the process of primitive accumulation. On the contrary, “...the ideological construct of the ‘passive revolution of capital’ consciously sought to incorporate within the frame- work of its rule... the entire structures of pre-capitalist community taken in their existent forms.” And “in the economic field, the form preferred was that of ‘community development’ in which the benefits of plan projects, meant for the countryside, was supposed to be shared collectively by the whole community.”(Chatterjee 1993: 213). The result is the continued presence of pre-capital along with a growing modern (capitalist) sector’ (34)
Summing up the general approach in the neo-Gramscian literature:
- The post-colonial bourgeoisie has to form alliances with dominant pre-capitalist groups to enter into state power.
- The state, representing the national popular, has to legitimize capitalist accumulation on the level of the people–nation.
- The need for legitimization rules out the process of primitive accumulation.
- The state therefore has to protect, preserve, and promote the pre-capitalist modes of production. The strength of the post-colonial capital thus lies in its ability to use the ideo- logical construct of passive revolution to carry on expanded reproduction in the modern sector and, at the same time ensure reproduction of the pre-capitalist, traditional sectors of the economy’ (35).
[But presumably this is transitional]
This is a political strategy, not a recognition of the ‘needs of capital’; and not caused by imperialism: ‘The process of legitimization that the neo-Gramscians refer to is a process internal to the nation: it involves capital, pre-capital, and the nation state’ (35). And ISI strategy fails to produce a fully-fledged capitalist transformation. But Neo-G approach is marked by same contradiction as Marxists: ‘The contradiction between the need to characterize capitalism in the periphery as a sui generis with dynamics of its own, and the implicit refusal to break away from the stagist paradigm of historical materialism that reduces the peripheral capitalism to a mere case of failure. … However, full-scale capitalist transformation, i.e. the classical case, as a possibility, remains embedded in the framework as a reference point, in terms of which the case of passive revolution is seen as a deviant one. The analysis thus remains implicitly anchored in the trajectory of capitalist development implied by the framework of historical materialism’ (36).
‘According to [Chatterjee], destruction of the pre-capitalist sectors through the process of primitive accumulation involves extensive use of coercive power, which, in the Indian case, the political framework of representative democracy does not permit. And therefore the state has to preserve and develop the traditional sectors’ (36).
Suggesting that if it had been possible to use coercive power there would have been a full transition.
‘Beyond Gramsci: Breaking with Historicism’, 38-41.
Need to ‘extricate the post-colonial story entirely from the historical materialist framework’ (38):
‘Only then are we in a position to see the post-colonial capitalist development not as the immanent supersession of the earlier contradictions but as a constructed hegemony with a dialectic of its own. This, for sure, is a theoretical task. It calls for a characterization of capitalist development that theoretically rules out the possibility of capital superseding pre-capital. And this is what marks my point of departure from the neo-Gramscian literature. In what follows I shall conceptualize capitalist development as a process that in its own course produces pre-capital. While on the one hand, the process of primitive accumulation, I will argue, leads to the destruction of the pre-capitalist sectors, on the other, it simultaneously produces a space that necessitates the recreation of those sectors. In short, pre- capital’s conditions of existence flow from the internal logic of the expanded reproduction of capital. (This characterization of capitalist development is elaborated in Chapter 2). Seen thus, pre-capital constitutes an internal ‘other’ of capital and the possibility of capital superseding pre-capital becomes a theoretical impossibility. And no synthesis is possible in the form of a full-fledged capitalism and the classical case of capitalist transformation by ‘battering down the Chinese wall’ turns out to be unrealizable even in principle’ (38-9).
First, ‘pre-capital’ becomes ‘non-capital’, and ‘commodity relations integrate capital and non-capital to form the post-colonial economic’. By going beneath the market, ‘we find the complex of capital and non-capital perpetually locked in a relation of contradiction and mutuality’ (39).
Second, ‘the idea that capital produces non-capital allows us to capture the dynamics of the post-colonial capitalism’ (39): ‘Our conceptualization of the post-colonial economic allows for a diachronic account of the capital–non-capital complex in terms of the two-sided process of destruction and creation of non-capital’ (40).
Third: ‘Most important, conceptualized as a complex of capital and non- capital, the narrative of post-colonial capitalism ceases to be a narrative of transition. … The conceptualization of post-colonial capital in terms of this complex amounts to saying that transition in the historicist sense has already occurred and what we have is capitalism with an inherent heterogeneity. Capitalist development in this scenario means not a structural shift from non-capital to capital, but the development of the entire capital–non-capital complex’ (40).
Chapter Two: Ship of Fools
Post-colonial capitalism like Foucault’s ‘ship of fools’ in Madness and Civilization: ‘The ship carrying its insane cargo, drifting from port to port, with the gates of the cities closed and the insane not allowed to disembark, brings to my mind a similar landscape, the post-colonial one, in which a large part of the population, dispossessed and marginalized, wander around in a wasteland created by “capitalist development”’ (45).
‘I attempt to rethink the Marxian concept of primitive accumulation of capital by explicitly considering exclusion and marginalization of surplus labor power as an inescapable moment of capital’s arising, and then conceptualize the post-colonial economic formation as a structural unity of capital and a sub-economy of the marginalized. In other words, my purpose is to inscribe the wasteland of the excluded into the narrative of capital’s coming into being’ (47).
[The question is, what are the developmental dynamics of this ‘structural unity’? Is it stable, and perpetual, or not?].
‘Primitive Accumulation: the Immanent History of Capital’ (47-52)
Describes it, for Marx, as ‘the process through which the initial conditions of the capitalist mode are created’ 48. Quotes Grundrisse, 459. Then: ‘The “capital in arising”, dependent on the “pre-capitalist outside” for its conditions of existence, is not capital as posited by the concept of the capitalist mode of production’, 48, which is fine as far as it goes. Capital once established does not ‘need’ its non-capitalist outside: capital’s need-based articulation theoretically cannot serve as an explanation of the failure of capitalist transformation of the third world’ 49-50. So: ‘What we need to do is to theoretically intervene in the concept of becoming/arising of capital and problematize the notion of self-subsistent capital to further complicate the concept of primitive accumulation as its immanent history’ 51
‘Not Even the Chains of Wage-Slavery: Surplus Labor Power and the Arising of Post-Colonial Capital’ (52-64)
‘In Marx, when the process of arising of capital is finally over—when capital has become and its becoming remains suspended in its being as prehistory—capital is not only self-subsistent but is also the universal mode of production. Universality of capital implies that nothing exists beyond its domain, no outside for it to cope with or relate to, that through the process of primitive accumulation, the pre-capitalist system of production has totally dissolved to create the initial conditions of capital. In other words, the process of capital’s becoming means the dissolution of the earlier modes of production and structures of property relations, but universality of the capitalist mode of production implies that the process of demolition of the old order to create the conditions of capital has left no wreckage.
In characterizing post-colonial capital in terms of the concept of primitive accumulation, it is precisely at this point that I locate my point of departure. I would imagine a scenario in which direct producers are estranged from their means of production, the latter are to make labor more productive, it changes the composition of new investments in favor of the constant part of the capital as opposed to the variable part, leading to a higher organic composition of the newly created capital. At the same time, composition of the existing capital also changes in the same direction due to the tendency to- wards centralization. Thus with accumulation, the variable part of the capital grows at a much lower rate than the overall rate of ac- cumulation, and since it is the variable part of the capital that serves as the basis of employment of labor, the rate of growth of employment falls short of the rate of accumulation. And “it is capitalist accumulation itself that constantly produces and produces in direct ratio of its own energy and extent, a relatively redundant population of laborers, i.e., a population of greater extent than suffices for the average needs of the self expansion of capital, and therefore a surplus population.
The reserve army therefore arises out of the very nature of capitalist accumulation, and the surplus population that constitutes the reserve army resides within rather than outside the domain of the capitalist mode of production. Unemployment and pauperism is the mirror image of employment, and the reserve army is an ex-tension of the active labor force—an appendage that is brought into being and reproduced by the capitalist mode of production itself. And it belongs to the being of self-subsistent capital” (p. 590)’ 52-3.
[This is wrong. Only the surplus population that is produced by the operation of the capitalist mode of production ‘arises out of the very nature of capitalist accumulation’, and so belongs to ‘the being of self-subsistent capital’. Only some of the surplus population is ‘a moment of the capitalist mode itself’.
The argument, anyway, is that capital creates a ‘wasteland’ inhabited by the dispossessed. But what is the relationship between the phenomenon of exclusion and marginalization with the emergence, consolidation, and reproduction of the capitalist mode of production?
‘The theoretical stance I adopt is radically different from this received wisdom of the traditional Marxist political economy. My position derives from the claim that the phenomenon of exclusion as a theoretical category belongs not to the realm of self-subsistent capital but to capital’s arising, its becoming, a process conceptualized in a space that captures the relation between capital and pre-capital. The wasteland of the dispossessed is the result of the process of primitive accumulation and the dispossessed as a theoretical category is excluded from the very space in which class-based exploitation is defined’ 58.
[But at least you would need to discriminate between ‘expelled’ and excluded]. He goes on:
‘The central point is that Marx’s rendition of primitive accumulation as the immanent history of capital does not recognize the existence of this wasteland. After capital comes into its own, it is the universal mode of production, self-constituting and self-reproducing, without, as I said earlier, any outside to cope with or relate to. The silence about the wreckage and debris left by primitive accumulation, the obliteration of the space of the dispossessed from the story of the capitalist mode of production, is a discursive violence. My purpose in this book is to inscribe the wasteland and its shadowy inhabitants into the heart of the becoming of capital to unsettle the smooth, linear trajectory of its immanent history. The repressed has returned, with a vengeance’ 58.
Here is the statement of the argument:
‘What is to be noted is that here Marx defines self-subsistence entirely in terms of the economic requirements, i.e. the requirement of labor power and capital—both constant and variable. The implicit assumption is that when capital’s economic conditions of existence are created and can be reproduced, the political and ideological conditions of existence are automatically ensured. But once we take into account the wasteland and its inhabitants as an outside of capital, the latter ceases to be self-subsistent even though it is capable of creating and reproducing its economic conditions of existence on its own. For its political and ideological conditions of existence, capital is not self-constituting and to secure the legitimation of its existence, it has to address the outside in politico-ideological terms. In other words, capital’s political and ideological conditions of existence require that the dispossessed producers inhabiting the outside be reunited with means of labor so that they can subsist by engaging in economic activities outside the domain of capital. What follows is a process whereby the means of labor are made to flow from the domain of capital to its outside where producers are reunited with the means of pro- duction to engage in non-capitalist production. More specifically, a part of the surplus produced in the capitalist sector is not transformed into new capital but transferred to the surplus population to constitute the conditions of existence of non-capitalist production. While primitive accumulation seeks to transform the means of labor into capital and subsume them within the domain of capitalist relations, this process of transfer is a reverse flow that extricates them from the space of capital and reunites them with labor. I characterize this decapitalization of means of labor as a reversal of primitive accumulation. The result is a need-based economy in which the dispossessed are rehabilitated in non-capitalist production activities; and the rehabilitation, I further argue, is made possible by interventions brought about by the discourse of development’ 59.
This is an ‘imperative of governance’, to be addressed in Chapter 4.
[This is about as mad as you can get – no way capital can do this, so has to resort to the ‘discourse of development’ as the agent].
Except capital is not self-sufficient in its own sphere:
‘The need for legitimation thus necessitates a reversal of primitive accumulation through developmental intervention but creation of a need economy is not the end of the story. The expansionary thrust of capital continues to subvert the need-based economy separating the direct producers from their means of labor and excluding them from the production economy. … It is this simultaneous process of primitive accumulation and its reversal, the process of destruction and recreation of the non-capitalist outside, of dissolution and conservation of the need-based economy that characterizes the arising of capital in the post-colonial context. The need-based economy as a site for non-capitalist activities gets effaced here only to reappear there in the next moment in a double-faced process of obliteration and reconstitution’ 60-61.
The first part of the argument makes sense (but doesn’t go against Marx): primitive accumulation is a ‘continuous and ongoing process that capital is perpetually engaged in’, or ‘an inescapable moment of capital’ 61. But the second part is pure fiction: ‘the post-colonial capital never becomes in the Hegelian sense. On the one hand, it engages in primitive accumulation, invades what lies beyond, usurps the economic space and becomes self-subsistent in so far as its expanded reproduction is concerned. But on the other, its political and ideological conditions of existence, the need for legitimation, demand that it leave a part of the economic space to a non-capitalist need economy—a reversal of primitive accumulation. Like the proverbial Sisyphus, capital is engaged in a task that is never accomplished: its arising is never complete; its universality never fully established; its being is forever postponed. In other words, inscription of the wasteland, in what Marx calls the immanent history of capital, condemns the post-colonial capital to a perpetual state of becoming’ (61) – ingenious, but bonkers. Leads to reassertion that ‘We have to … see post-colonial capitalism as necessarily a complex of capital and a non-capitalist need economy. This, at the same time, extricates the story of post-colonial capital entirely from the historical materialist paradigm and the Hegelian idea of supersession that informs it. For, if capital necessarily exists as a complex of capital and a non-capitalist outside, then the historical materialist trajectory of stages in which capital supersedes pre-capitalist modes becomes totally irrelevant ruling out full-fledged transformation even as a possibility. And this marks our departure from the Gramscian narrative of passive revolution that presents the post-colonial scenario as a case of blocked transition while full transition remains the reference point in relation to which the post-colonial case is seen as a deviant one’ (61-2).
‘For Marx, once capital has arisen, it no longer needs to engage in exchange with any non-capitalist outside for neither labor power nor the means of labor. But the claim that capital is entirely on its own falls through as soon as we bring to the fore the fact that labor power is not reproduced at the site of capitalist production; household as a non-capitalist site exists where the reproduction of labor power takes place. In the Marxian value calculus, the subsistence basket that the worker receives from the capitalist is treated as the value of labor power, i.e., its cost of reproduction. Labor power, however, is reproduced in the household and the process of reproduction involves not only the subsistence basket received as wages but also the labor performed by the members of the household. These include the labor required to transform commodities in the wage-basket into articles of consumption and also affective, emotional labor that goes into rearing the child—the prospective source of labor power. Thus, the household as a site of non-capitalist production is crucial for the expanded reproduction of capital, and capital continues to engage in exchange with a non-capitalist outside. But the Marxian value calculations completely suppress these indispensable production activities undertaken in the household and capital’s claim to self-subsistence and universality is predicated on the act of obliteration of the household from the discourse on capital’ 62-3.
So he claims that ‘Marxian discourse’ ‘posits capital’s universality by adopting a particular representational strategy that denies the existence of the household as an outside of capital’ 63 – sheer nonsense. Sees relation of capital to household as one of extraction/appropriation, v. exclusion of the ‘post-colonial wasteland’: ‘The post-colonial wasteland in contrast is the space of the excluded, a space constituted by people who do not perform, in fact are not given the option to perform any labor for capital’ 63.
[Obviously not true, and the extraction/exclusion contrast belied anyway by shift of household tasks to immigrant labour from the wasteland].
So, straight after highlighting ‘jobs for Nike’ (via McCloskey) he goes on to describe the post-colonial wasteland as ‘the space for the rejected, the marginal’, which unlike the household ‘has no role to play in the creation of the economic conditions of capital’s expanded reproduction’ 63-4.
‘Beyond the Narrative of Transition: The Post-Colonial Economic’ (64-73)
‘The post-colonial economic, in our conceptualization, is constituted by a dual process: on the one hand, the ongoing process of primitive accumulation of capital estranges direct producers from their means of labor, creating a wasteland constituted by the expropriated and dispossessed, and in a parallel process of reversal of primitive accumulation a need economy is created for their rehabilitation’ 64 – this is essentially the whole of his argument.
So the question arises: ‘But what makes this process of rehabilitation possible? Who institutes the need economy? How are its conditions of existence created and reproduced? What are the agencies that converge to ensure the conditions for its reproduction?’ 64.
And the answer is: ‘I see the process of recreation and renewal of need economy as being rooted in a global discourse of development and the agencies produced by that discourse’ 64.
Their aim is the reproduction of the need economy 65. Acute poverty to be eliminated by uniting the dispossessed with the means of labour, ‘that is, by allowing them to have access to productive resources’ 65.
‘What is important is that production activities in the need economy are predominantly non-capitalist, such as self-employment based production, household production with family labor or different forms of collective/communal organizations of production. These non-capitalist forms of production are seen by the development discourse as the appropriate and effective ways of constituting the need economy … development does not see the solution to the problem of poverty necessarily in terms of an overall capitalist transformation; its emphasis rather is on re-energization of traditional non-capitalist institutions and forms of production to be used as effective instruments for achieving the goal set in terms of consumption or standard of living of the marginalized and the dispossessed’ 65.
[I would like to see some evidence]
The need economy is the production of commodities for the market but: ‘instead of immediate consumption of use value, production in the need economy is production of exchange value with the purpose of acquiring the required consumption basket through the mediation of the market’ 70.
[So why don’t primitive accumulation and capitalist development follow?]
‘From the Politics of Transition to the Politics of Exclusion’ 73-80)
NB Garbled endnote 10, pp. 101-2. Sanyal regards the creation of this need economy as a success for the local bourgeoisie (74-5), despite the fact that as a consequence it does not develop as a bourgeoisie.
‘The process of primitive accumulation and its reversal that lies at the heart of the post-colonial economic, I argue, is to be seen as a global process. When post-colonial capital engages in primitive accumulation it does so as an integral part of global capital. The question of legitimation therefore refers to the political conditions of existence of global capital as a whole, and creation of those conditions requires a global management of the wasteland by creating and sustaining a need economy’ 76.
‘Legitimation of global capital— reproduction of its politico-ideological conditions of existence— through poverty management is now a global project to be undertaken, planned, and executed by global developmental organizations and footloose NGOs. In other words, primitive accumulation by global capital produces a wasteland in the third world and legitimation of capital requires the creation and renewal of a need economy through a global discourse of development. [Post-colonial states are now actors in the globally instituted management of poverty only as a vehicle of that discourse]—they are now instruments of global governance’ 77-8.
Section concludes with an overview of Foucault on discourse as a practice.
‘Development as Discourse’ (80-98)
Ferguson 1990. Escobar 1995. As he shows in his summary, Escobar thought the goal of development discourse was Western-style modernity, but it failed. Sanyal doesn’t agree (85-98). He sees a break around early 1970s:
‘It is a shift from the earlier notion of “development as a systemic transition” to one of “development as improvement”. The earlier claim was that development necessarily means a process of capital accumulation through industrialization accompanied by disintegration of pre-capitalist/ premodern economic organizations and social institutions, bursting of the bonds of caste, creed, and race, and their replacement by capitalist/modern economic, cultural, and social institutions. In the early 1970s, this view of development as an all-encompassing, macro- level transformation yielded place to a different notion of development that aimed at meeting the needs of the poor of the third world—needs defined in terms of nutrition, shelter, health, and education—in direct ways that are not necessarily mediated by a program of overall “transformation” of the traditional order’ 88.
Structure of argument – Chapter 3, first moment of complex hegemony process in which the process of development is identified with the process of primitive accumulation of capital; Chapter 4, ‘the legitimation crisis posed by the continued existence of absolute poverty necessitates a de-essentialization of development. The development discourse seeks to reorganize itself and produces a new system of meanings of the economic entities on the basis of need as a new nodal point. By foregrounding concepts such as “basic needs”, the discourse shifts away its focus from capital and thereby distances itself from the notion of development as transition’ 97. Then:
‘The tension between need and accumulation as the two contending nodal points remains at the heart of the development discourse until they both are turned into parts of a new complex totality produced by the market as the master nodal point. With the rise of neo-liberalism, post-colonial capitalist development is now being posited as a market driven process within a system of meanings that can accommodate accumulation and need as two apparently non-contradictory nodal points residing within a single space defined by the market. It signals a regime of capital that requires a need economy inhabited by non-capital to rehabilitate the victims of accumulation. This is the third moment of the discourse, described in Chapter 5, where a complex form of hegemony is discernable within which the reproduction of post-colonial capital, and its dominance, are ensured’ 97-8.
Chapter 3: Accumulation as Development: the Arising of Capital
Making Development Happen (105-110)
Novelty of post-WW2 concept of development as brought about by purposive planning and purged of political content by focus on rational planning, appropriate programming and efficient implementation.
Different Stage but the Same Script (111-3)
Focus on ‘a predetermined, unidirectional trajectory derived from the ex-post, immanent history of capitalist development in the West and its presumed lineality’ 111.
‘Put differently, what lies invisible in the early discourse of development is how the unity of labor with the means of labor within the pre-capitalist system is destroyed and the means of labor are trans- formed into capital, an alien power confronting labor—a narrative so vigorously told by Marx’ (112).
Structure of Primitive Accumulation and the Modalities of Power (113-127)
Marx, Capital I. Quotes inter alia ‘The so-called primitive accumulation is, therefore, nothing else than the historical process of divorcing producers from their means of production’ – which of course implies that as long as there are producers not divorced from their means of production, primitive accumulation continues 117. So does the system of ruling out alternative means of survival discussed 120-27. Ironic that exactly the same strategy still applies, globally, today:
‘Viewing labor not merely in terms of the wealth it produced but in terms of an ethical transcendence actually served to establish the conditions of capitalist production by providing an ideological justification of the coercive methods adopted to turn the dispossessed into wage-laborer for the capitalist system of production. The ideology of work espoused by the bourgeoisie was an integral element of primitive accumulation. The state power in its juridical form, however, was not the only form of power that made primitive accumulation and the emergence of the capitalist mode of production possible. Parallel to the coercive power of the state, a regime of what Foucault calls the “capillary form of power” was at work that sought to discipline the society by subjecting the human body to a network of continuous surveillance at various micro sites: school, hospital, and workshops. It was a non-sovereign, disciplinary power that operated outside the domain of the sovereign–subject relation, and this disciplinary mechanism combined with legislations and juridical controls to form the entire field where power was to be exercised for ensuring the conditions of the emergence of capital and produce “docile bodies” as the source of surplus value’ 124-5.
Perversely, he denies this and insists on the opposite: ‘the notion of development as provision of basic needs involves the deployment of a form of power whose techniques are fundamentally different from the ones that primitive accumulation was based on. It is a different mode of power that does not operate in terms of denial and suppression; it is a power that is productive and creative, it constructs and enlivens subjectivities rather than impede them’ 126.
Inauguration of the Discourse (128-152)
1950s development economics, Nurkse, Rosenstein-Rodan, Hirschman, Leibenstein, Lewis. Focus is on Lewis 1954, ‘a discursive construction with accumulation as nodal point (in the sense of Laclau–Mouffe) that produces the economy as a contingent totality by provisionally fixing the meaning of its instances and places capital and pre-capital in a hierarchy’ 135-6.
Sample statement: ‘The discourse thus organizes the economy as a totality around accumulation by positing the various instances of the economy in terms of their capacity to support and facilitate the accumulation process’ 140.
Critique of Lewis for not factoring in non-farm production in the ‘subsistence’ sector. A very dubious claim follows:
‘Fifty years after Lewis’ work inaugurated the development discourse, a consensus now seems to be emerging that the trajectory of capitalist development envisaged by Lewis has failed miserably to transfer the entire pool of surplus labor to productive employment in the capitalist sector. The international developmental organizations that once embraced the accumulation-centric approach are increasingly recognizing the existence of production activities in the “informal sector” that constitutes an outside of the capitalist sector. ILO’s insistence on the importance of the informal sector as a source of employment and on the need to pro- vide support to it, and World Bank’s concern about non-farm rural employment, are re-inscribing z-goods into the space of development, albeit in a displaced and reconstituted form’ 151.
Industrialization in Post-Colonial India: Planning as the Realm of Reason (152-66)
Shift towards industrialization strategy was relatively slow, over first three five-year plans.
Chapter 4 De-essentializing Development: Capital and Governmentality
Robert McNamara, Nairobi address to Board of Governors of World Bank, 1973, which he says proposed alleviation of direct poverty ‘as a goal distinct from accumulation and growth’, not really true 169. This, he says, was the ‘governmentalization’ of the developmental state 170.
More Foucault – governmentality and the welfare of the population. The turns to the relationship between governmentality and capital, 173-6. Core argument repeated:
The destruction of pre-capital as the necessary condition for capital’s arising was legitimized in the name of progress, but now poverty is integral to capital’s own existence, an “other” that it cannot escape. Development can now claim the legitimacy of capital’s existence only by addressing poverty and deprivation in terms of governmental technologies with the aim of ensuring subsistence to the dispossessed, to the inhabitants of the wasteland that surrounds the world of capital. This requires that a part of the capitalist surplus be transferred from the domain of capital for implementing anti-poverty programs; development now means a reversal of primitive accumulation’ 174
Not consistent with McNamara, I don’t think.
It goes on:
‘Thus there is dispersion within the discourse with its object undergoing transmutation. By shifting the focus from accumulation to eradication of absolute poverty, the discourse distances itself from the capital’s own agenda, and the space of development emerges as a space distinct from the one in which the story of the modes of production and capital is inscribed. Development is no longer synonymous with the project of an overall capitalist transformation of the economy, a project that President Truman’s 1949 speech described as one for which “ancient philosophies have to be scrapped; old social institutions have to disintegrate; bonds of caste, creed and race have to burst”. The primary concern of development now is the “improvement” of the conditions of the poor, who is located outside the domain of capital, with governmental technologies’ 174-5.
Not so. McNamara called for increased small farmer productivity, with property rights, credit, irrigation, obviously intended to eradicate subsistence farming.
Need, Entitlement and Capability: Development as Governmentality 176-84
Not fully developed until Sen in 1980s. Sen 176-9. Robert Ayres as a key source (1983!!). WDR 1980 cited as follows:
‘The World Development Report (1980) of the Bank explicitly recognized that growth might cause dispossession and poverty:
[L]ooking at changes over time within particular countries, the connection between growth and poverty reduction over periods of a decade or two appears inexact. There is a general agreement that growth, in the very long term, eliminates most absolute poverty; but also that some people may (at least temporarily) be impoverished by development—as when a tenant farmer is dis- placed by his landlord’s tractor or a shoemaker by mass-produced shoes. (pp. 35–36)
And it goes on to emphasize the absence of any trade off between growth and the poverty-focused approach:
[T]he connection between economic growth and poverty reduction goes both ways. Few would dispute that health, education, and well-being of the mass of people in industrialized countries are a cause, as well as a result, of national prosperity. Similarly people who are unskilled and sick make little contribution to a country’s economic growth. Development strategies that bypass large number of people may not be the most effective way for developing countries to raise their long-run growth rates. (p. 36)’
And he comments (184) ‘Thus the discourse first produced its own critique of “growth essentialism” and then restructured the space of development on the basis of this auto-critique to posit the eradication of absolute poverty and accumulation as its dual objectives, with profound implications for the post-colonial developmental states’. But the question is, what did it say next?
The Changing Perspective of Development and the Indian Planning, 184-8.
Poverty-eradicating measures introduced in Sixth Plan, 1980. Same argument:
‘Thus, Indian planning assumed a governmental role in order to ensure that it helped in the rise of the political conditions of existence of the post-colonial capital. For almost two-and-a-half decades after the independence it had been engaged in creating the conditions for primitive accumulation; now it was actively engaged in redistributing a part of the surplus generated in the capitalist sector to the poor through anti-poverty programs. And the space of planning was restructured to accommodate the non-capitalist goal of improving the condition of the victims of primitive accumulation’ 187.
At the same time he acknowledges the ‘Green Revolution’ as ‘undoubtedly an attempt to inaugurate capitalist transformation in the Indian agriculture, 187, but claims that:
‘The real change within the realm of planning occurred after the Green Revolution, a change whose profound implications escaped the Indian Marxist. It was the change from the preoccupation with accumulation to the concern about the poor, and with it the emergence of the governmental face of the state. And it is crucial to grasp the importance of this change to arrive at an understanding of the dynamics of post-colonial Indian capitalism’ 188.
Chapter 5 Difference as Hegemony: Capital and the Need Economy
The Theme of Return 189-191
(Zizek) Globalization to a return to 19th century laissez faire, or earlier imperialism. Ironically, he makes this mistake in talking about spread of informalization. ‘I will argue that far from a return to the past, what we are witnessing is the emergence of a capitalism that is radically new in its form of governance and modalities of power’ 190: a new era in which ‘the accumulation-centric vision—we have already characterized it as the first moment of the hegemony process—is fast fading away but it is yielding place to an entirely new imaginary of development, one that is rooted in governmentality rather than in the project of planned primitive accumulation. In the preceding chapter, I argued that there was already a mutation in the notion of development from the 1970s with the focus shifted from accumulation to pro- motion of welfare through direct intervention. It was the project of legitimizing capital’s existence by resorting to a reversal of primitive accumulation for providing entitlements to the dispossessed. I will now claim that the development discourse in this era of capital is reorganizing itself entirely in relation to the world of the dispossessed produced by capitalist accumulation, and now it is governmentality in a form that is far more complex, with far greater material effectivity, than before. Its goal is to constitute an economic space outside and alongside capital, for its castaways, rather than to create entitlements for them through redistribution of income’ 191.
The Challenge of the Slums 192-3
A third of the global urban population live in slums (2001). Davis (2004), surplus humanity. Hence ‘management of poverty’, for which we require to explore the genealogy of the ‘informal sector’.
The Discursive Constitution of the Informal Sector 193-207
‘Informal economy’ focus of ILO attention since 1970s. [See also WDR 1978, 5-6]. His focus is on a paper by Paul Bangasser, 2000, then Harris/Todaro, 1970 on inducement to migrate although jobs are few (wage differential). Data collection from early 1990s, turn of the century recognition of ‘breeding ground for entrepreneurship on a mass scale’ 205. Majority of economically active population. With this discursive shift, there is ‘an important moment of departure in which development is finally extricated from the narrative of transition’, 206.
The Need Economy 208-215
Non-capitalist economic space characterized as a need economy. ‘I see it as an ensemble of economic activities undertaken for the purpose of meeting needs, as distinct from activities driven by an impersonal force of systemic accumulation’ 209.
This is crazy – from the point of view of the worker, the formal sector is just as much a need economy.
Anyway, brings out the dualism of his approach:
‘I call the realm of capitalist production the accumulation-economy and that of informal production the need economy. In the first, production is for accumulation, and in the second, it is for meeting need. They are two distinct economies, two systems, each with an internal logic of its own. While one is driven by the logic of accumulation, production in the other is organized to support a certain level of consumption. Although they both reside in the realm of ex- change and money, their simultaneous presence marks a discontinuity in the space of the market. These two economic spaces together constitute the post-colonial economic, inscribing in it an inescapable dualism’ 212
So simply twists Lewis model by denying the possibility of transition. But NB informal ‘need’ economy includes wage-labour.
‘Empirical studies have reported an immense heterogeneity within the informal economy: these activities take place within a wide variety of informal arrangements and a network of oral contracts and relations of reciprocity. The forms of labor on which they are based are also varied and many: pure self-employment, family labor, communal labor, or even wage-labor and their various combinations. The concept of the need economy encompasses the entire ensemble of these activities because despite the heterogeneity of their forms, they have one common characteristic: they all enable the producer to have access through the market to a consumption basket that will satisfy his need’ 212.
Not quite the same as subsistence economy because it may generate a surplus. But further complicated by the employment of labour in the ‘need’ economy – fatal for his approach. He calls it another complication, but the fact is that the need-accumulation dualism breaks down. Obfuscation 214-5.
Difference as Hegemony: Capital’s Self-Representation in a Globalized World 215-227
Two ‘nodal points’ now – accumulation and need. But completely incoherent again:
‘For example, labor in the first space is the means to produce surplus for investment and accumulation, and the state is an institution for creating the most favourable conditions for the accumulation process. But when seen in relation to the second space, labor is the means to acquire entitlements to consumption through the production of marketable commodities, and the state’s role is to create conditions to ensure these entitlements’ 216.
This looks at labour from the point of view of capital in the first instance, but the worker in the second. Also, ‘the informal sector is described in a positive light with dynamism and innovativeness attributed to it, qualities that promote it to a level where it can be treated at par with the formal sector’ 217.
As diversity and plurality are now promoted and managed by capital in order to legitimise itself, it is wrong to celebrate their presence as a countervailing force 225-6. Rather, ‘in the now prevalent development imaginary, while governmentality, through a reversal of primitive accumulation, activates the need-space by promoting newly formed subjectivities— the self-employed, the z-goods producer, the subsistence producer in a small cooperative—the need economy remains the space of confinement for the dispossessed and castaways of capitalist development. It is a space that prevents them from banging on the doors of the glittering world of capital’ 226.
And micro-credit is the mechanism through which the need economy is created and renewed.
Financing the Need Economy: Governmentality and the Global Management of Policy 228-236
‘A new architecture of development must complement the new global capitalist order, and this new paradigm of development focuses on the management of poverty from a global perspective. More precisely, the creation and renewal of the need economy is now a global process driven by a global discourse’ 228.
Perversely, he follows a series of quotes that clearly indicate the use of micro-credit to bring the poor into the capitalist economy, he presents it as a means of keeping them outside it: ‘We, from our perspective, will interpret the core content of this pro-poor growth strategy as the creation of the need economy. It is a strategy that seeks to reunite the pauperized with the means of labor to constitute an economic space outside the economy that is driven by the logic of accumulation’ 230.
WDR 2002 cited 235. Ch 8 makes exactly the opposite argument; and see also p. 174: reliance on informal institutions alone is not enough for growth of inclusive markets.
Informalization within the Accumulation-Economy 237-42
‘So far, we have described the informal need economy as existing outside the accumulation-economy of capital. We now have to contrast it to a phenomenon that is increasingly being highlighted in the commentary on globalization: informalization of production activities within the circuit of capital—a phenomenon that results from the internal logic of the accumulation economy itself. Studies in the informal sector have emphasized the observation that a part of the sector is deeply implicated in the modern formal economy through various linkages of subcontracting and outsourcing (Sethuraman 1997, Tabak 2000). There is a tendency among development theorists and practitioners to see the informal sector entirely in terms of this embedded-ness and to focus exclusively on these linkages for designing policies. But what is to be emphasized here is that need-based production that resides within and is organically related to the accumulation circuit is very different from the need- economy that exists outside the circuit.33 It is the latter that has been our concern in this book, and it should be emphatically contrasted with the former’ 237.
Putting-out, self-employed sub-contracting, and sub-contractor as informal employer of wage labour.
‘Thus through this dispersion of production on a global level, a part of the informal need economy of the third world finds itself implicated in the circuit of the global accumulation-economy’ 240.
So: ‘The important point here is that we must sharply contrast the need economy that results from developmental governmentality— the one we have described in this book—with informalization within capitalist production described above’ 240.
The Indian Economy Goes Global 242-5
Put together, [the post-1991] reforms significantly altered the structure of the Indian economy in favor of a system driven by the market forces and private entrepreneurship. Although the neo-liberal advocates of reforms complain about the insufficient implementation of the proposed reform package, there is no denying that the Indian economy in the preceding decade-and-a-half has experienced a rupture with the past. The post-colonial regime of economic development through planned accumulation, with the state as its most important agent, has been virtually abandoned to embrace a system in which accumulation is driven entirely by the market forces and the logic of capitalist calculation.
Jobless Growth 245-51
Key section.
‘The growth rate figures however belie a phenomenon that the Indian economy has been experiencing in this period of boom: the growing level of unemployment. The evidence also points to the fact that while the economy is growing steadily in terms of the GDP, its impact in terms of employment generation has been negligible. It is not India alone, the entire developing world—and to a certain extent the developed countries as well—is witnessing this growth–employment paradox’ 245
Same error of analysis as in previous two sections repeated here:
‘In terms of our story, the strategy is one of constituting and fostering the need economy to provide income-entitlements, as the accumulation-economy is incapable of accommodating the surplus labor force. The fact is that the unorganized sector has always been there, providing subsistence to an overwhelming majority of the working population, but the discourse of planning in India never recognized its existence—it was a dark space between the traditional agriculture and the mod- ern industry. The discourse now illuminates this space, “discovers” the unorganized sector and turns it into an object of planned governmentality. The accumulation-economy, driven by the logic of capitalist calculation and the forces of the market, will grow on its own, but at the same time the need economy has to be created, fostered and managed by purposeful planned intervention for providing livelihood to the excluded’ 249.
Insists that the aim is the reproduction of dualism 251: ‘After struggling for half-a-century with this elusive project, the project of post-colonial development is finally coming to terms with the fact that there is a dualism endogenous to post-colonial capital, and the role of the developmental state is to create the conditions within which the two-tier world of capital can be reproduced’.
This account is just as historicist as any other – a permanent settlement based on a stable dualist equilibrium. But at the same time one in which capital continues to penetrate the space of the dispossessed. And one in which some employers of wage labour choose to provide services to global capital as sub-contractors but other employers of wage labour choose not to and do not seek to accumulate.
Conclusion: Towards a New Political Imaginary for the Post-Colonial World
‘The politics of exclusion … unyokes the anti-capitalist political project from the story of transition by envisioning post-colonial capitalism as a complex of capital and a need economy and focuses on the space of the marginal and the dispossessed. Its critique of capital is centered not on the inability of capital to transform pre-capital but on the wasteland of the dispossessed created by the very process of primitive accumulation. The goal of this politics is to politicize development. As we have seen, developmental governmentality posits itself as “politically neutral” practices, the purpose of which is to improve the conditions of the population groups with the help of rational calculations by experts and professionals. The politics of exclusion subjects the depoliticized face of governmentality to a political critique and seeks to posit the terrain of governmentality as a politically contested terrain.
Politicization of the governmental functions of the developmental state and the international organizations means pitting the need economy in radical opposition to the accumulation-economy of capital. The new anti-capitalist politics claims autonomy for the need economy and asserts its demand for resources (means of labor, credit, training, information). Governmentality creates and renews the need economy but at the same time confines it to an “informal” space outside the space of capital. In the complex hegemonic order of capital that I have described, the dominant discourse of development allows capital an autonomy in the sense that the accumulation- economy can expand on its own. The expansion of the accumulation- economy is the result of both capitalist accumulation—creation of new capital with surplus produced within the capitalist production system—and primitive accumulation. As primitive accumulation results in dispossession, development rehabilitates the dispossessed in the need economy. Thus, the need economy remains a passive space that is obliterated and recreated in the course of capital’s autonomous process of expansion, although in the representation of the development process the two are posited as complementary and parallel. The precise goal of the politics of exclusion is to unsettle the dominant regime of representation to bring to light this asymmetry and then to endow the need economy with autonomy that will allow it to posit itself as the radical “other” of capital. In other words, the purpose of the new politics is to liberate need-based production from the informality and spatial fixity that the dominant discourse imposes on it so that it can encroach upon and unsettle the space of capital. … The politics of exclusion aims to resist the invasion of the accumulation-economy into the parallel need economy and to assert the latter’s demand for resources to create the conditions for its expanded reproduction. At the same time, it strives to extricate the implicated part of the need economy from capital’s circuit, to liberate these activities from the grasp of the systemic logic of capitalist accumulation, and unite them with the parallel part of the need economy to constitute a unified economic space where production is grounded in the logic of need’ 255-7.
Once the space of the dispossessed is conceptualized in terms of needs-based production, ‘multiple population groups in political society and their plural struggles can be seen as grounded in the need-economy. Communities that emerge from these struggles, with their various forms of solidarity, can find a common identity in relation to their location in a unified “informal economy”. The politics of the governed then rises above its temporary and contextual nature and is able to posit a radical critique of capital’s accumulation-economy. Governmental technology necessarily presents the social as heterogeneous and the outside of capital is represented in the discourse of welfarist governmentality as fragmented, consisting of multiple population groups. And the precise task of the anti-capitalist politics of exclusion is to ground these fragments in the space of need to produce a unified and stable “other” of capital’ 258.
So in the end he calls for an alliance between workers, those in the ‘need’ economy, and those in the informal economy ‘implicated in the circuit of capital’:
Marx in Grundrisse repeatedly draws our attention to this subjugation of the world of need to the logic of accumulation, to the fact that the worker can perform the necessary labor for his/ her own reproduction only if she/he performs surplus labor for the capitalist. Seen thus, the existence of the direct producers belonging to the three distinct parts of the economy—the need economy that exists outside the domain of capital, the informalized production activities that are implicated in the circuit of capital and the formal capitalist labor process—is grounded in production for the satisfaction of need, and they are all subjected to capital’s dominance although the nature and form dominance is different in each case [sic]. The perspective of need can thus provide a common ground for both the “excluded” and the “included” in their battle against capital.
A radical political agenda for today’s post-colonial world, deeply implicated in a global capitalist order, thus must be rooted in an articulation of these two terrains of politics: the terrain that foregrounds the need economy in radical opposition to the continual and ongoing process of primitive accumulation of global capital, and the one that focuses on class-based exploitation within capital’s own space. It is only by articulating these two realms of politics— instead of reducing one into the other or placing them in a hierarchy—that we can carve out from their criss cross a complex space, a space politically far more fertile than the one defined by class alone; a space in which radically new counter-hegemonic imaginaries, and the contours of strategies and actions to turn those imaginaries into actualities, can be made visible.
Partha Chatterjee, The Nation and Its Fragments, OUP, 1993.
Partha Chatterjee, The Politics of the Governed: Reflections on Popular Politics in Most of the World, Bombay, Permanent Black, 2004.
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