The notion of “secular stagnation” – made famous
initially by Alvin Hansen when the Great Depression was in full swing in the
1930s – refers to the secular – that is
to say, constant and irremediable, in the
course of time – decline of “the natural rate of interest”. There are two
elements that immediately leap to our attention when considering these twin
notions: the first is that secular stagnation refers to the inevitable decline
of the “natural rate of interest”; and the second is that therefore the “natural
rate of interest” is not “natural” merely in the sense that it is set and
determined by involuntary factors beyond human control – natural in the sense
of “automatic” – but also that the natural rate of interest is “natural” in the
sense that the economic organism to which it applies is subject to a physiological or organic process of stagnation that resembles the ageing of an
organism that is unstoppable. This would seem to bring the operation of
economies, and therefore also of economics as a “science”, closer to the study
of a biological process rather than a purely mechanical-quantitative one. The
old notion of Classical and Neo-Classical Political Economy that located the
scientific kernel of “economic science” in the determination of Value and in
its distribution among various “factors of production” – this notion seems to
be outflanked and entirely superseded by that of “the natural rate of interest”
when it is tied to that of “secular stagnation”.
In both Classical and Neo-Classical
Political Economy there simply was no room for notions such as “secular
stagnation”, though there certainly was an implicit notion of a “natural rate
of interest”, that is, a rate of profit “naturally” corresponding to a given
type of economy. The concept of secular stagnation goes beyond Wicksell’s
initial formulation of the natural rate of interest in the sense that for the
first time the problem of economic science is no longer that of the distribution of Value or indeed of the growth of Value (its production) which
up until now had seemed to be a “natural” aspect of capitalist production. With
the notion of “secular stagnation” for the first time bourgeois economic “science”,
and thus the bourgeoisie itself, seems to be coming to terms with the “decline”
of its system of production, capitalism, which it now sees as inevitable to the
degree that it is “secular”. At the same time, with this notion the bourgeoisie
tries to shift the blame for the decline of its system of production and of its
political regime to a “natural” and “organic” process – a process akin to that
of the “ageing of an organism”.
In other words, whereas in the heyday of
bourgeois capitalist development the focus of orthodox bourgeois “economic
science” was to determine the “natural” mechanism for the production and above
all the distribution of Value – now suddenly bourgeois economic science becomes
aware of the inevitable, unstoppable decline
of capitalist production…and quite possibly even of the demise,of this system of production – and with it, surely, also the extinction of the bourgeoisie itself. For
once, the usually triumphant bourgeoisie becomes aware and wary of its ultimate
mortality!
Hence, not only is the bourgeoisie aware of
its system of vertiginously and intolerably destructive
production (the oxymoron is a slap in the face for Schumpeter’s “creative
destruction”), but yet it also seeks profligately to deflect responsibility for
this onto some “natural” process of decay – without examining the causes of
this degeneration and indeed the reasons behind the fact that “economic science”
can no longer be an objective impersonal and disembodied, neutral-technical
study but must rather concentrate on the ways in which distorted human social
relations of production have as their ultimate deleterious effect the
destruction of the environment in which humans necessarily operate – the destruction
of the ecosphere.
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