Wednesday, 8 March 2017


I will be presenting on a panel at Manchester University's 2017 Post-Crash Economics Society Conference, held on the weekend of 18-19 March.

The panel topic is 'The Global Power of Finance', and the session is held in room 3.213 in the University Place building in Oxford Road M13 9PL, from 14.00-15.30 on Saturday 18 March.

Some organisational and booking details are given here, together with a link to the programme. I reproduce the latter below, but the text may not be clear.

Tony Norfield, 8 March 2017

Sunday, 5 March 2017

The Politics of Counting Billions of Beans

Just in case you were one of the half dozen or so people who thought that Brexit would be a simple affair, the UK's House of Lords European Union Committee has produced a report. Published yesterday, Brexit and the EU Budget is a 65-page analysis, with hyperlinks to the detailed evidence given on more than 70 questions and references to a multitude of EU-related documents. As one expert witness put it, there are 'many unknowns'. The chairman asked: 'Are these known unknowns or unknown unknowns?' The response was: 'All of them'.

The report covers the UK's potential liabilities to the EU and details the kinds of asset over which it might have a claim. Estimates in the media have claimed the net UK exit 'bill' as being anywhere from zero to 60 billion euros or more, and these different takes are analysed. However, the general conclusion is that all of this comes down to politics and a trade-off between different areas as part of the broader exit negotiations. It is not a thrilling read, but an instructive one that spells out the complex web of relationships within the EU.

Tony Norfield, 5 March 2017

Wednesday, 1 March 2017

What is Marx’s Value Theory Worth?

At a recent talk I gave on imperialism, there was an interesting question raised on what I thought about Marx’s theory of value. This seemed to be prompted by my reference to Marx’s theory, while I spent little or no time using the terminology in Capital. So the logic of the question was: what is the point of Marx’s theory if one can do without it when explaining what is going on in the world?
Partly, the question is answered by saying that one does not always have to use specialist terminology to express ideas. For example, I have found it to be simpler in presentations to avoid Marx’s term ‘fictitious capital’, because that concept would take some time to explain properly and most people are not familiar with it. Even those who are commonly misunderstand it. Instead, I usually develop the same ideas more directly through discussing the role played by equities and bonds and their relationship to what the economy produces. However, the question needs to be put in a broader context.
Marx’s value theory analyses social labour under capitalism and the increasingly odd forms that it takes as capitalism develops: from being represented in the prices of commodities, to being the source of interest, profits, dividends, rents and tax revenues, to underlying, in an even more distorted fashion, the prices of financial securities. Marx’s theory shows how the capitalist market gives the system a particular dynamic, one that leads to the monopolisation of production and the creation of a world market as capital accumulates. The labour embodied in commodities may not tally directly with the prices they command in the market, but those prices remain strongly influenced by changes in social productivity. Furthermore, we get a longer-term process by which barriers to capitalist production are set by the tendency of the rate of profit to decline. Since the logic of capitalist production is to make a profit, this is the key underlying problem for capitalism as a social system. It is one that the (sometimes) well-meaning reformers of the system do not want to contemplate, so they exclude this from their analysis or go out of their way to deny this does, or even could, happen.[1]
These fundamental features of capitalism analysed by Marx remain in place, although the system has of course developed a great deal in the 150 years since Capital was written. However, the changing forms of capitalism have led many to argue that Marx’s theory is outdated or invalid today. But a proper Marxist analysis examines the dynamic of the system and the new forms that evolve out of the old, rather than simply to judge whether contemporary capitalism fits completely with an earlier conception of it.
In Capital Volumes 1, 2 and 3, Marx did not investigate relationships between countries in the world market. Some of this was done outside the three volumes, and plans for later volumes included a more systematic coverage of the state, foreign trade and the world market. So, for example, in Capital there was no real discussion of colonies, just brief mentions, nor much on monopoly or national differences in wages.
Lenin updated aspects of Marx’s work in his 1916 pamphlet Imperialism, drawing on other analyses. He correctly put greater emphasis on the division of the world economy between oppressed/oppressor nations, the territorial division of the world between the major powers, the propensity to war, on monopolies, bank/industrial capital and a ‘financial oligarchy’. This was a key advance in the analysis, and consistent with the idea of Marx’s value theory as being a theory of the evolution of and barriers to the capitalist system – hence Lenin’s term ‘moribund capitalism’. Many aspects pointed out by Lenin remain relevant today, even though these century-old forms have, of course, also developed. There is now a largely post-colonial world, although many countries are still clearly underdogs in the imperial hierarchy. There remains a propensity to war, but now with many wars by proxy, sponsored by the major powers.
I have some differences with Lenin’s analysis, as explained in my book, The City: London and the Global Power of Finance, especially on his understanding of finance, which was taken largely from Hilferding. However, perhaps Lenin’s greatest weakness was his analysis of the ‘labour aristocracy’, the unconvincing notion of how a labour elite getting the benefits of imperial privilege influences the broader working class with their pro-imperialist views. Even in Lenin’s time it would have been more convincing to have taken into account how the mass of people in rich countries were patriotic for their own reasons, ones that had a strong basis in reality rather than a supposedly infectious ideology. They saw, and still see, their economic interests tied up with that of their own states, and benefit in their wages and welfare conditions from this imperial privilege. That is another sign of how it is important to conduct a thorough analysis.
I rely on Marxist concepts as starting points for understanding the world today because they provide the best way to explain what is going on. However, this is not to say that one can find the detailed answers in a particular volume of Capital. To think so would be almost as bad as believing in the prophecies of Nostradamus. Instead, the significance of Marx’s theory is that it so clearly spelled out the dynamic of capital accumulation that, much more than one might think plausible, his analysis provides key building blocks from which to understand major features of the world economy today.
Whether I use terms from Marx’s value theory in my analysis, and which terms, depends on the context in which I make my argument and how much time there is to do so. In any case, Marx’s work is used as just described. His concepts, like Lenin’s, might need to be amended – perhaps even rejected – according to an assessment of how the world has developed since they wrote.
The observation that capitalism in various forms has been around for several hundred years is commonly seen as an argument that it will go on forever: that it is an eternal, natural system for organising the economy. While economic crises are an undeniable reality and sometimes bring protests, there remains little understanding or acceptance of the Marxist conclusion that capitalist social relations are an increasingly dysfunctional, reactionary way in which to organise the affairs of humanity.

Tony Norfield, 1 March 2017

[1] I have little confidence in being able to track movements of the rate of profit through official statistics, although one does get indications of the underlying movements from the behaviour of major capitalist companies and reports of investment that suggest a rising organic composition of capital. Official data are focused on an individual country, and do not fully allow for international influences, something especially important for the US. Statistical conventions for counting the ‘value added’ by the financial sector make things worse, as exemplified by UK GDP income data in 2008 showing a higher operating profit for UK banks when the company reports, and Bank of England data, showed a very sharp drop, often into losses! This is apart from the multitude of accounting tricks that large corporations use to relocate the origin of their profits, including through tax havens.

Monday, 27 February 2017


It took me a while, but I have finally used the Blogger system for accessing past and current contributions on this blog by topic, identified by the label attached to each post/article. So, assuming it all works, if you want to find out what I have written in the past six years about various things, around 90 labels are listed at the end of the main page.

The labels are ordered in terms of the frequency with which the labels have been used. At present, 'Imperialism' is at the top, 'BRICS' is close to the middle and 'value chains' is at the end. Greece, Saudi Arabia, Norway, pirates, Donald Trump, the Ottoman empire and commercial capital also feature on the list. It is slightly arbitrary, since one can overdo or underdo the labels, or use one term rather than another for basically the same thing. Nevertheless, I hope it will give interested readers an easier way around the six-year list of articles and comments.

Just as a note, I have deleted no previous articles or comments. Where I have made more than minor stylistic changes to the original text to clarify the wording (there were a couple of cases where I corrected a point originally made) I have indicated that with a comment in the relevant post.

Tony Norfield, 27 February 2017

Wednesday, 15 February 2017

The Anti-Russia Syndrome

I normally cast aside explanations of events based on the psychology of the actors, but this has been hard to do in recent months. How else, apart from signs of paranoia, can one explain the never-ending stories in the mainstream media about the Russian menace?
A constant tirade against Russia emanates from television and radio channels, and from all the ‘quality’ newspapers and reporters. (See this Youtube video of Putin explaining that the BBC’s John Simpson has no ‘common sense’). Only the topic changes with the times. One early focus was Russia’s intervention in Crimea/Ukraine, which upset US and European strategy. The next was how Russia’s support for Assad in Syria unravelled and sidelined disastrous western policy. One of the latest is the election of Trump, billionaire-in-chief of the US hegemon. A shocked US political elite can only put down Trump’s election to the nefarious Russkies, not to domestic political reaction. Right on cue, a British ex-MI6 agent provided a dossier of ‘evidence’ to ‘demonstrate’ that Putin was in a position to blackmail Trump! If that were not bad enough to show how the commies were undermining western liberal democracy, new stories are about Russian support for Marine Le Pen’s Front National in France and other rightwing parties in Europe.
The anti-Russia syndrome reflects two things outside the realm of psychosis. Firstly, it is a sign of big power frustration with a permanent member of the UN Security Council that can veto US-led UN resolutions and which can also back up its policies with military firepower. Secondly, the chronic phase of the crisis persists, and this is straining the political infrastructure, as most clearly seen with the Brexit and Trump votes. ‘Anti-communism’ is one of the few comfort blankets that the western powers can cling on to in these troubling times and pretend that they are all still in the same gang.
Take the UK government, for example. No longer invited to any EU soirĂ©es, the UK has to grandstand at NATO. The UK Ministry of Defence today declared that one of its key objectives for this week’s NATO summit in Brussels was
“to ensure the Alliance continues to make progress on taking forward the ambitious agenda agreed at Warsaw, in particular on modern defence and deterrence towards Russia. On that front (literally), the enhanced forward presence of NATO battlegroups is deploying this Spring to the Baltic States and Poland, with the UK proud to be leading the formation in Estonia, one of our most effective Allies in the Helmand campaign.”
The anti-Russian strategy has been a hallmark of British imperialism ever since the October revolution of 1917, and it has helped shape, or has been used in, almost all of its other policies. From the late 1930s/early 1940s, Britain focused upon splitting India into two countries, so as to make the new Pakistan a bulwark against any Russian incursion into its interests in the Indian subcontinent and the Persian Gulf. Britain also feared Soviet involvement to stymie its attempts to re-establish its colonial empire (and those of other powers) in the late 1940s. Britain went out of its way to support Moslem fundamentalism in the Middle East and North Africa as a counter-weight to local demands for freedom from foreign domination, usually put forward by secular nationalists, and it justified this by using the fear of ‘communist subversion’, even when that was completely unfounded. Similarly, Britain used the Soviet threat as a way to get the Americans to back its policies, as with the US involvement in the 1953 coup that overthrew Mossadegh in Iran. There were many other such initiatives, as documented in Stephen Dorrill’s MI6: Fifty Years of Special Operations.
Russia has completely embarrassed British and American political strategy at a time when Britain wants to hold on to its role as facilitator for that strategy in European and beyond. Now, post-Brexit, the Brits are high and dry, but Theresa May hopes to continue to hold hands with Donald Trump over NATO.

Tony Norfield, 15 February 2017

Thursday, 9 February 2017


Next Thursday, 16 February, I will be giving a lecture on 'Capitalism, Imperialism and Finance' at the University of Sussex, Falmer, near Brighton.

The session is run by their Centre for Global Political Economy, and Sam Knafo will be a discussant.

It is from 5-7pm, the location on the campus being Essex 18.

If that's convenient for you, I look forward to seeing you there.

Tony Norfield, 9 February 2017

Wednesday, 1 February 2017

Finance and the Imperialist World Economy

I will be giving a lecture next week at King's College, London, on Wednesday 8 February.

The session is from 6pm to 8pm, and is part of a series of seminars at King's on Contemporary Marxist Theory.

The seminars are open to the public, but arrive in time to get signed in if you want to attend.

Venue details:
342N Norfolk Building (entrance on Surrey St)
King's College London, Strand, London WC2R

Summary of topics:
This paper discusses how the financial system both expresses and reinforces the power of major countries. Developing Marx’s theory by examining bank credit creation, bond and equity markets, the paper shows how what Marx called the ‘law of value’ is modified by the evolution of finance. To understand imperialism today, one has to recognise how financial markets help the centralisation of ownership and control of the world economy. They are also an important way in which the US and the UK siphon off the world’s resources. The question of Brexit and the City of London is also discussed.

Tony Norfield, 1 February 2017