Keynesianism, Social Conflict and Political Economy. (Book Reviews).

Massimo De Angelis

Macmillan, London

ISBN 0-333-71513-7X [pounds sterling]45.00

Keynesianism, Social Conflict and Political Economy aims to reveal the class nature of economic models by looking at the significance of class conflict and working class resistance for the social construction of Keynesianism. By providing 'a retrospective look at the rise and fall of Keynesian economic orthodoxy in relation to social conflict'(p.3) this book revitalises a significant political discussion, usually obscured by technical and economistic discourses. The book offers a critique of the economic theory that transformed Keynes' proposal into a paradigm. It does this through critical analyses of Keynes' theory, the constitution of Keynesianism, and Fordism in historical context as well as making an assessment of the possibility of revitalising Keynesianism on a global scale. This is a welcome project.

In its eleven chapters, the book addresses the question of how Keynes criticism of laissez-faire economics originated and how his categories 'developed under the pressures of economic social turmoil' (p. 8) (chapter two). It discusses the key aspects of Keynes' work and interprets them in political terms, showing that they were inspired by the intention to handle social conflict (chapter three). It also provides a classic case study of Ford's labour organisation as an example of the strategies that, in different forms, were to be 'attempted at the social level in the post-war period and which constituted the basis for the operationalism of Keynesian policies: the attempt to implement a "social deal" in the context of mass production'(p.9) (chapter four). The next two chapters (five and six) outline the 'various developments during the Second World War that lead to the realisation of this "social deal"' (p.9), including class unrest, institutionalisation of trade unions, grassroots activities and the 'formatio n of an economic orthodoxy' (p.9). In the following chapter (seven), De Angelis explores the institutional features of post-war Keynesianism, which are theoretically deconstructed in chapter eight. By means of a Marxist analysis of Keynesian Fiscal Multiplier and Inflation and the Phillips Curve, chapters nine and ten aim to show that economic models are underpinned by class struggle.

The principal idea of the book is that Keynesianism is not about economics but about politics. De Angelis defines Keynesianism as a paradigm, a 'form of social practice' which implied 'a vision of power relations among classes in society' (pp.2-3) but of course this was at a particular historical conjuncture. However, in the conclusion De Angelis poses a question about the present 'viability' and 'desirability' of Keynesianism. De Angelis asks: what are the 'general conditions and social costs that a new form of Keynesianism will have to meet if it is to become a viable capitalist strategy' (p.10). At the end of the book he asks the question, '[A]ssuming systematic Keynesian policies of growth promotion were possible, would they be desirable?' (p. 174). On the other hand, Keynesianism, De Angelis tells us, 'relies on at least two interlinked institutional pillars: expansionary demand policies to promote growth and employment creation ... If any of these parameters is missing, Keynesianism cannot be viable' (p .157). De Angelis argues that what constrains the revival of Keynesianism are, first, the global movement of capital and the globalisation of financial markets, and, secondly, the transformation of the class composition of labour, i.e. "'the working class" itself has taken on characteristics that it did not have during the Fordist period ... it is today more fragmented and divided' (p.172). These transformations would restrain the implementation of a Keynesian strategy as a form of regulation of class conflict since the parameters of capital accumulation have changed.

It seems to me that this exploration of the viability of Keynesianism as a new capitalist 'strategy' on a global-scale weakens De Angelis' critique of economic orthodoxy. Like any other bourgeois -ism, Keynesianism is a form of rationalisation a posteriori, of a specific historical configuration of class struggle in specific countries. The key word here is historical. One of the most important achievements of economic orthodoxy has been the consistent presentation of historical economic forms of class struggle as if they were technical issues or 'business strategies' implemented in order to cope with changes and crises. Although undeniably the current forms of labour and capital impose constraints on capitalist strategies, a real restriction on the reinvention of global Keynesianism lies in the fact that Keynesianism was, as suggested by De Angelis, a form of power relations in a determinate historical moment. Therefore, it cannot be repeated. In other words, I doubt that the question about the viability and desirability of Keynesianism in the 21st Century posed at the end of the book actually contributes to the author's efforts to demystify orthodox economic theories.

Overall, De Angelis' book is welcome as an energetic attempt to contest economic orthodoxy and to re-establish the significance of class struggle at the heart of technical discussions on Keynes and Keynesianism.

Ana C. Dinerstein is a lecturer at the University of Bath and a member of the Editorial Board of Capital & Class. She is co-editor (with Mike Neary) of The Labour Debate: an investigation into the theory & reality of capitalist work (Ashgate, 2002).