Capitalist Crises and the Crisis This Tme

BY LEO PANITCH AND SAM GINDIN

Exactly a hundred and fifty years before the current crisis began in August 2007, the collapse of the Ohio Life Insurance Company in New York triggered what became known as ‘the great crisis of 1857-8’. As it quickly spread to Europe’s main financial centres, Karl Marx ‘was delighted and thrilled by the prospects for another revolutionary upsurge on the continent’.

As Michael Kratke notes, ‘the crisis started exactly as Marx had predicted already in 1850 – with a financial crisis in New York’ and the crisis itself led Marx to extend ‘the scope and scale of his study’ for the Grundrisse notebooks he was working on, so as to take account of ‘the first world economic crisis, affecting all regions of the world’. In their correspondence, Marx and Engels agreed that ‘the crisis was larger and much more severe than any crisis before’, viewing the financial crisis as ‘only the foreplay to the real crisis, the industrial crisis that would affect the very basis of British prosperity and supremacy’.

In October 1857, Engels wrote to Marx: ‘The American crash is superb and will last for a long time... Now we have a chance’. And two weeks later: ‘…in 1848 we were saying: now our moment is coming, and in a certain sense it was, but this time it is coming completely and it is a case of life or death’.

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