Luxemburg, Rosa 1870 or 1871-1919

BIBLIOGRAPHY

Rosa Luxemburg was a Polish Marxist revolutionary as well as the most relevant figure of the left wing of the German Social Democratic Party (SPD). Together with Leo Jogiches (1867–1919), she was the leader of the Social Democratic Party of the Kingdom of Poland. Breaking with SPD for its support of World War I (1914–1918), with Karl Liebknecht (1871–1919) she founded the Spartacist League (Spartakusbund ), which became in 1918 the German Communist Party (KPD). Luxemburg was killed during the German Revolution of January 1919 by the paramilitary Freikorps, and by the order of the SPD chancellor Friedrich Ebert.

At Zurich University Luxemburg trained in law and economics. Indeed, many of her writings can be seen as an original and undogmatic reprise, critique, and development of Marxist critical political economy. By 1898 she was widely known for her trenchant and astute criticism of the mounting revisionism. In Social Reform or Revolution? (1899), the pamphlet she wrote against fellow SPD member Eduard Bernstein, Luxemburg strongly objected to the idea that capitalism was entering a phase of social and economic stabilization, with the end of class polarization and the attenuation of economic crises. Skeptical about the law of a tendential fall in the profit rate, she nevertheless defended “collapse theory,” but with too generic a reference to the lack of demand for commodities. She also stressed the essential link between money and value, justifying Marx’s notion of abstract labor as a real abstraction that actually comes into being with the unity of production and circulation.

She refined her argument after 1907 when she started teaching economics at the SPD party training center in Berlin. While preparing her lectures (which were posthumously collected in Introduction to Political Economy, 1921) she stumbled upon a difficulty in Marx. Luxemburg stressed what she called the “law of the tendential fall” of the “relative” wage—that is, of the share in the new value added that goes to workers—as the other side of relative surplus value extraction. In her view, though, the real wage may grow when the productive power of labor rises, the former always lagging behind the latter. Workers’ consumption is thus decreasing. Hence the question: Can capitalist investments fill the gap, and guarantee the smooth development of capitalist extended reproduction? In the Accumulation of Capital (1913) Luxemburg attacked Marx’s schemes of reproduction for promoting the illusion that in a “closed” setting capitalism can go on as “production for the sake of production,” and only disproportional crises can occur. Imperialism is seen as the consequence of the need to find new markets in non-capitalist areas. In the end, collapse due to lack of effective demand was certain: To avoid slipping into “barbarism,” socialist revolution was historically necessary.

She was fiercely attacked by critics who hit some blind spots in her formulation (which was written in haste in a few months) but missed the core of her position, stated most clearly in the Anti-Critique (written in jail in 1916–1917). Capital must be analyzed first of all as a macro-monetary circuit. Therefore, the issue at stake is that capitalists cannot recover from monetary circulation more than they injected into it, advancing either constant or variable capital. From this theoretical stance, the realization problem opens to the problem of finance as fundamental in a monetary production economy. This does not mean that Luxemburg’s view was correct: She discarded the distinction between “financial” and “industrial” capital, so her question could not have an answer. But her approach was more farsighted than her critics understood because she opened a new problematic (Bellofiore 2004).

Two interpreters who clearly perceived this were Joan Robinson (1951) and Michal Kalecki (1967). Robinson saw that the key issue in Luxemburg was that accumulation depends on the incentive to invest. Kalecki extended her position, showing that capitalism can find effective demand not only through net exports, but also through state deficit spending financed by the central. However, it must not be forgotten that in the last instance, crises erupt because of relative surplus value extraction: Although it induces a fall in the wage share, it also systematically upsets the conditions of equilibrium for capitalist reproduction, and then provokes disproportions and leads to a general “glut.” Realization crises are failures to sell products at prices that recoup expected profitability due to inadequate aggregate demand. They are rooted in the dynamics of exploitation within the capitalist labor processes where valorization—that is, the production of surplus value starting from a given value—immediately occurs.

Customarily, Luxemburg’s position is labeled as determinist and under-consumptionist (which is clearly wrong), and her political perspective is condemned as spontaneist. A convincing rebuttal of this reading was put forward by Norman Geras (1976). What is relevant is Luxemburg’s opposition to Lenin. As Rossana Rossanda succinctly states, Luxemburg “never maintained that the masses could do without an organized vanguard which, for her, was identified with the party. However, the need for the latter was not derived from the absence of a political dimension of working class struggles as such, but from the objective fragmentation of these struggles, which a unifying strategy could alone overcome” (1970, p. 224).

In recent decades, interest in Luxemburg has shifted from discussion about her political, social, and economic thought to her pacifism, her love for nature, and her anticipation of some traits of contemporary feminism (Nye 1994).

SEE ALSO Accumulation of Capital; Economic Crises; Feminism; Imperialism; Kalecki, Michal; Robinson, Joan; Socialism

BIBLIOGRAPHY

Bellofiore, Riccardo. 2004. “Like a Candle Burning at Both Ends”: Rosa Luxemburg and the Critique of Political Economy. Research in Political Economy 21: 279–297.

Geras, Norman. 1976. The Legacy of Rosa Luxemburg. London:New Left Books.

Hudis, Peter, and Kevin B. Anderson. 2004. The Rosa Luxemburg Reader. New York: Monthly Review Press.

Luxemburg, Rosa. [1913] 2003. The Accumulation of Capital. London: Routledge.

Luxemburg, Rosa. [1921] 1972. The Accumulation of Capital:An Anti-Critique. New York: Monthly Review Press.

Nye, Andrea. 1994. The Thought of Rosa Luxemburg, Simone Weil, and Hannah Arendt. London: Routledge.

Robinson, Joan. 1951. Introduction. In The Accumulation of Capital. London: Routledge and Kegan Paul.

Rossanda, Rossana. 1970. Class and Party. Socialist Register. 217–231.

Riccardo Bellofiore