Now a classic of Marxian economics, The Limits to Capital provides one of the best theoretical guides to the history and geography of capitalist development. In this edition, Harvey updates his seminal text with a substantial discussion of the turmoil in world markets today. Delving into concepts such as “fictitious capital” and “uneven geographical development,” Harvey takes the reader step by step through layers of crisis formation, beginning with Marx’s controversial argument concerning the falling rate of profit and closing with a timely foray into the geopolitical and geographical implications of Marx’s work.
The Limits to Capital is 50% off as part of our end-of-year sale (ends January 1, 2019). Full details here.
Here we present an excerpt from the Introduction.
Everyone who studies Marx, it is said, feels compelled to write a book about the experience. I offer this work in partial proof of such a proposition. But I do have an additional excuse. After the completion of Social justice and the City (nearly a decade ago), I determined to improve upon the tentative, and what I later saw to be erroneous, formulations therein and to write a definitive statement on the urban process under capitalism from a Marxist perspective. The more deeply enmeshed I became in the project, the more I became aware that some of the more basic aspects of Marxian theory to which I sought to appeal lay quite undeveloped and in some cases almost empty of consideration. So I set out to write the theory of urbanization, to integrate it with detailed historical studies of the urban process drawn from Britain, France and the United States, and to casually fill in a few 'empty boxes' in Marxian theory en route. The project soon became totally unwieldy. In this book, long as it is, I deal only with the 'empty boxes' in the theory. Let me explain how that came to be.
It is both a virtue and difficulty in Marx that everything relates to everything else. It is impossible to work on one 'empty box' without simultaneously working on all other aspects of the theory. The bits and pieces I had to understand - such as the circulation of capital in built environments, the role of credit and the mechanisms (such as rent) that mediate the production of spatial configurations - could not be understood without careful attention to the relationships they bore to the rest of the theory. I saw, for example, that earlier errors on the interpretation of rent arose precisely out of a failure to integrate this single aspect of distribution into the general theory of production and distribution that Marx proposed. The trouble is, however, that there are many different interpretations of that general theory. Furthermore, as is to be expected, investigation of the topics of particular interest to me suggested new ways to think about value theory, crisis theory and so on. I had no option except to write a treatise on Marxian theory in general, paying particular attention to the circulation of capital in built environments, the credit system and the production of spatial configurations.
All of this took me very far from my original concern with urbanization under capitalism; with the details of Haussman's administration in Paris and the subsequent glories and horrors of the Paris Commune; with the processes of urban transformation and class struggle in my adopted city of Baltimore. Yet the links arc there. I think it is possible to pull all of this together, to transcend the seeming boundaries between theory, abstractly formulated, and history, concretely recorded; between the conceptual clarity of theory and the seemingly endless muddles of political practice. But time and space force me to write down the theory as an abstract conception, without reference to the history. In this sense the present work is, I fear, but a pale apology for a magnificent conception. And a violation of the ideals of historical materialism to boot.
In self-defence I have to say that no one else seems to have found a way to integrate theory and history, to preserve the integrity of both while transcending their separation. Marx went to great pains to keep the history-theory relation intact in the first volume of Capital, but covered probably about one-twentieth of what he intended as a result (he never finished Capital, and projected books on foreign trade, the world market and crises, the state, etc., were left totally untouched). And the history disappears almost entirely from the preparatory studies that make up volume 2 of Capital. For my part, I wanted to get through the materials Marx assembled in the three volumes of Capital, the three parts of Theories of Surplus Value and in the Grundrisse in order to deal with the particular topics that interested me. There was no way to do it except by stripping the theory of any direct historical content.
But I hope that the general theory set out here will be helpful to the study of history and the formulation of political practices. I have found it so. It has helped me to understand why capitalism engages in periodic splurges of insane land speculation; why Haussman was brought down in 1868 by the same kinds of financial difficulties that beset New York in the 1970s; why phases of crisis are always manifest as a joint reorganization of both technologies and regional configurations to production; and so on. I can only hope that others will find the theory as helpful. And if not, then I suppose the burden rests on me to demonstrate the utility of the theory in future works that have a more explicit historical, geographical and political content. This should not be taken to mean, however, that I regard the theory as correct and sacrosanct. It surely deserves all kinds of modification in the light of critical review, better and more general theory construction and thorough testing against the historical record, as well as in the fires of political struggle. I publish these theoretical findings as a contribution to a collective process of discovery. I do so now because I cannot take the subject much further without a radical change in direction which will take several more years to bear fruit.
I could puff out this introduction with learned-sounding comments on matters such as epistemology and ontology, on the theory and practice of historical materialism, on the 'true' nature of dialectics. I prefer to let the methods of both enquiry and presentation speak for themselves through the text and to let the object of enquiry emerge in the course of study rather than to set it up a priori like some cardboard cut-out on a back-lit stage. But some general comments on what I have tried to do, and how, may be helpful to the reader.
The general objective has been to combine a mode of thinking that I conceive to be dialectical with as much simplicity of exposition as a manifestly complicated subject matter will allow. Such aims are not easily reconciled. At some points, the striving for simplicity takes me dangerously close to the perils of reductionism, while at others the struggle to keep faith with the intricate integrity of the subject matter brings me to the brink of obscurantism. I have not avoided either error to my own satisfaction. And I am only too well aware that what appears as reductionist to the expert long steeped in Marxian theory may appear unnecessarily obscure to the newcomer. My tactic in the face of this has been to strive for enough simplicity in the opening chapters to give newcomers, willing to struggle with admittedly difficult concepts, the greatest possible opportunity to grapple with the more substantive contributions of later chapters. I have tried to keep better faith with the intricacy of the subject matter in the chapters on fixed capital, finance and money, rent and the production of spatial configurations.
I do not, however, want the argument to be construed as a linear argument, in spite of the apparent linearity in the flow. The first chapters are not firm and fixed building blocks upon which all subsequent chapters are erected. Nor are the later chapters derived or deduced out an original set of propositions advanced at the outset. I begin, rather, with the simplest abstractions that Marx proposed and then seek to expand their meaning through consideration of them in different contexts. The view of the whole should evolve as more and more phenomena are integrated into the vast composite picture of what capitalism, as a mode of production, looks like. The difficulty here is to come up with a mode of presentation - a form of argumentation, if you will that does not do a violation to the content of the thoughts expressed. Each chapter focuses on a particular aspect of the whole. The difficulty is to preserve the focus while keeping the relation to everything else broadly in view. Constant invocation of 'everything else' would needlessly clutter later chapters and render the initial chapters incomprehensible, because subjects not yet analysed would have to be invoked without explanation. Marx tried to deal with the problem in the opening chapters of Capital by fashioning a language of such density and utter abstraction that most ordinary mortals are left quite bewildered, at least on first reading. I have sought a middle ground. I use notions of opposition, antagonism and contradiction as connecting threads to bind the materials together. In so doing I employ a logical device which Marx uses to great effect. The details will be explored later, but the general tactic is worth elucidating in advance, if only to provide the reader with some idea of how the subsequent argument will unfold.
At each step in the formulation of the theory, we encounter antagonisms that build into intriguing configurations of internal and external contradiction. The resolution of each merely provokes the formation of new contradictions or their translation on to some fresh terrain. The argument can spin onwards and outwards in this way to encompass every aspect of the capitalist mode of production. For example, Marx opens Capital with the idea that the material commodity is simultaneously a use value and an exchange value, and that the two forms of value necessarily oppose each other. This opposition (which is internal to the commodity) achieves its external expression in the separation between commodities in general (use values) and money (the pure representation of exchange value). But money then internalizes contradictory functions within itself which can in turn be resolved only if money circulates in a certain way, as capital. And so the argument proceeds to encompass the class antagonism between capital and labour, the contradictory dynamics of technological change, and ultimately evolves into an elaborate and lengthy disquisition upon those seemingly irreconcilable contradictions that lead capitalism into the cataclysms of crises. The first seven chapters summarize and interpret Marx's argument, according to such a logic, up to the point of what I call 'the first cut' at crisis theory, as exemplified by Marx's theory of the falling rate of profit.
In the remaining chapters I use the same logical device to extend Marx's argument on to less familiar terrain. The analysis of fixed capital and consumption fund formation in chapter 8 shows that the surpluses of capital and labour produced under the conditions described in the 'first cut' at crisis theory can be absorbed by the creation of new forms of circulation oriented to future rather than present uses. But we then find that these new forms are at odds, in the long run, with a continuous dynamics of technological change, itself a necessary condition for the perpetuation of accumulation. The 'value' put upon fixed capital becomes an unstable magnitude as a result. The continued circulation of capital is threatened with severe disruption.
The credit system then comes to the rescue. In chapters 9 and 10 we discover that the credit system, as a kind of 'central nervous system' for the regulation of capital flow, has the potential to resolve all of the imbalances to which capitalism is prone, to resolve the contradictions earlier identified. But it can do so only at the price of internalizing the contradictions within itself. Massive concentration of financial power, accompanied by the machinations of finance capital, can as easily de-stabilize as stabilize capitalism. And a fundamental opposition arises in any case between the financial system - the creation of money as credit money - and its monetary base (the use of money as a measure of value). This sets the stage to examine the financial and monetary aspects of crisis formation, including financial panics and inflation. This forms the 'second cut' at crisis theory.
The chapter on rent nominally completes the theory of distribution but also allows us to consider the spatial as well as the temporal dynamics from a theoretical perspective. Further analysis of the geographical mobilities of capital and labour shows how the contradictions of capitalism are, in principle at least, susceptible to a 'spatial fix' - geographical expansion and uneven geographical development hold out the possibility for a contradiction-prone capitalism to right itself. This leads directly to the 'third cut' at crisis theory, which deals with crisis formation in its spatial aspects. Under this heading we can approach the problems of imperialism and inter-imperialist wars from a fresh perspective. We see once more that pursuit of a 'spatial fix' to capitalism's internal contradictions merely ends up projecting them, albeit in new forms, upon the world stage. This, I argue, allows us to construct a framework for theorizing about the historical geography of the capitalist mode of production.
The Limits to Capital is 50% off as part of our end-of-year sale (ends January 1, 2019). Full details here.