The problems of a changing economy also triggered a revival of Marxism and an increased interest in socialism. Gathering force through the 1960s, the resurgence of radicalism was less an attack on the dominant economic theory and policy as it was a critique of the economic system and its effect. A new interest in Marxism appeared, along with a wide range of non-Marxist radical analyses of the modern world.
One book led the way in the United States for the resurgence of Marxism as a tool for analyzing the contemporary economy. It was Monopoly Capital (1966) by Paul Baran (1910-1964) and Paul Sweezy (1910- ). Baran, who died two years before the book was published, was professor of economics at Stanford University. An earlier book. The Political Economy of Growth (1957), had already marked him as a major contributor to Marxist economic theory. In it, he focused attention on monopoly as the distinguishing feature of highly developed capitalism, on the production of an economic surplus that had to be disposed of, and on a drive toward economic imperialism leading to inevitable conflict between the advanced and the underdeveloped economies. All of these themes were developed in the later book. Baran's co-author, Paul Sweezy, had begun an academic career, teaching at Harvard University from 1934 to 1942 and writing two important pieces, one on interest groups among American corporations and the other on the theory of oligopoly. After government service in World War II, he helped found in 1949 the leading American Marxist journal, Monthly Review, and was one of its editors until a few years ago. He also wrote an important Marxist work. The Theory of Capitalist Development (1942), which is still one of the best restatements of basic Marxist economic theory for the contemporary reader.
Monopoly Capital made a major contribution to Marxist theory by shifting attention away from the assumption of a competitive economy, which was basic to the original analysis developed by Marx, and by focusing on the monopolistic aspects of giant enterprise in the contemporary economy. In doing so it also deemphasized the role of the working class and the class struggle, as it worked out the logic of an economy dominated by privately owned big corporations.
The argument runs as follows: monopolistic large corporations are able to maintain selling prices at relatively high levels while competing with each
other to cut costs, advertise and sell, and develop new or modified products, all in a gigantic race for profits. An economic surplus is the result, which can't be absorbed by consumer spending, however wasteful, or business investment, which only increases the surplus. Part of the surplus is absorbed in mammoth sales and marketing efforts and part through government employment. But the major thrust of monopoly capital is toward imperialism and militarism as the easiest and surest ways of utilizing otherwise surplus productive capacity. In the process, exploitation centers on low-wage workers at home, especially blacks and other minority groups, and on underdeveloped areas overseas that provide opportunities for profit even larger than in the home economy. For the average person the profit nexus and exchange relationship destroy meaningful human relationships, leading to widespread alienation, hostility, and purposelessness. The entire system is essentially irrational, for although individual economic units may be operated with the utmost emphasis on rational decisions, the system as a whole is directed toward irrational goals. Nevertheless, the system continues to function effectively because of military spending and Keynesian full-employment policies. It will continue to do so until the less-developed countries throw off the yoke of neocolonialism and the worldwide system of industrial capitalism collapses.
This brief summary can only suggest the richness and breadth of the analysis and the angry condemnation of modern life the book contains. If it had been written by anyone other than the two leading American Marxists, it might have become a major best-seller, just as some non-Marxist critiques have been. Baran and Sweezy were clearly describing the same economy as Galbraith, and much of their analyses were parallel. As it is. Monopoly Capital has had a steadily widening influence both in the United States and abroad.
Perhaps equally influential in stimulating radical analyses of modern society was an earlier book. The Power Elite (1956), written by the Columbia University sociologist C. Wright Mills (1916-1962). Mills argued that the United States is ruled by an elite group of business, political, and military leaders who manage the large bureaucratic organizations that dominate modern life. Recruited from a relatively narrow stratum of society, this group of several thousand elite managers selects itself by an informal process in which the older leadership passes on a value system that stresses acquisition of wealth and private enterprise. Oligarchy, rather than democracy, dominates modern America, along with the corrupt values of individualistic materialism, according to Mills.
These themes—dominance of the economy by giant corporations led by a self-selecting elite, and the problems of the capitalist economy—are the distinguishing features of radical analyses of the modern economy. In the United States, the Union for Radical Political Economics publishes a journal, sponsors national and regional conferences, and participates in the annual meetings of the American Economic Association. There are similar groups in England and other countries of Western Europe.
The Marxist revival and related radical economic thought were not particularly associated with support for the Soviet Union and its brand of socialism. Many radicals, including strong Marxists, looked with dismay upon the centralized bureaucratic methods of planning of the Soviet Union. They are more favorably inclined toward decentralized administration, market socialism, and workers' management. A search is under way among radicals for alternatives to both private-enterprise capitalism as practiced in the United States and Western Europe and the centralized state planning of the Soviet Union.