Banaji on Debt.

If memory serves David Graeber referred to the work of Jairus Banaji in several of his responses to criticisms of Debt. Graeber rightly pointed out that Banaji’s work departs from the model of the ideal average that Marx provides in Capital in order to investigate the variety of ways capitalism developed historically. Graeber used Banaji’s historical account to back up points he makes in Debt that question the pervasiveness of doubly free labour in capitalism. Unfortunately, Graeber does not seem to have engaged with points Banaji makes about how these types of labour are subsumed by the overriding ‘laws of motion’ of the world capitalist system. In doing so Banaji also points out how forms of debt that Graeber accounts for in a non-capitalist, actually functioned in the process of capitalist valorization.

A case in point is Banaji’s analysis of the Hacienda system, where he makes the following point contra Knight (who’s argument seems to resemble Graeber’s):

Gibson’s reversal of perspective, in turn, was the basis for the kind of distinctions that Alan Knight went on to make in an essay that breaks with the ‘superficial similitude of debt’ to distinguish classic debt-servitude from other more ‘proletarian’ and certainly less coercive forms that are usually conflated with it.32 Knight’s paper contains a brilliant description of the fiercely repressive form of capitalism that prevailed in late nineteenth-century Yucatán, where the boom in fibre-production was met by a monocultural, quasi-industrial hacienda-régime based on extreme coercion (flogging, debt-servitude, etc.)33 but also financed to a great degree by New York brokers and the banks they borrowed from.34 As Wells points out, the expansion of the henequen industry was bound up with legal changes that stipulated that ‘the peón who left work without paying the sums that he owed would be prosecuted before the courts’.35 But Yucatán’s ‘classic’ debt-servitude was part of a capitalist labour-régime where it functioned to reinforce the ‘internal mobility and flexibility’ of a tightly regulated labour-force where workers were transferred between tasks and in general piece-rated,36 and it is worth emphasising that, in Mexico anyway, these types of extreme coercion (‘comparable to chat- tel slavery’) were more characteristic of quasi-industrial enterprises such as those in timber and tobacco than of the coffee-plantations of Chiapas or the purely agricultural haciendas of central Mexico.37 (340)

I’m also unaware of Banaji engaging with Graeber’s work. It would be interesting to see the two debate the matter.


About HR

Deep in the adjunct crackhole.
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3 Responses to Banaji on Debt.

  1. David Graeber says:

    Where do i say it was “non-capitalist”? I say the opposite. I argue that capitalism doesn’t necessarily have to operate primarily with free labor. Well, logically, I couldn’t very well be arguing that unless I thought there were systems operating with unfree labor that were in fact capitalist. So how does Banaji’s point that those systems were ultimately subsumed in a capitalist logic contradict me? That’s exactly my point.

    • HR says:

      Point taken. It looks like I misinterpreted your comments on Libcom when I re-read them. For some reason I though that your points that: (1) the typical financial institutions of capitalism predate capitalism and (2) labour in capitalism is not always wage labour were part of an argument about how these types of debt and labour functioned in a manner that did not correspond with the logic of capitalist accumulation. Therefore it seemed to me that Banaji’s account differed with this.

      My basis for this interpretation was these two points from

      (1)” the book I wrote what I thought was a friendly challenge to Marxist theory – I said, basically, that we are used to writing as if

      a) capitalism is based on the relation of production between free wage laborer and the owner of capital
      b) the form and meaning of capitalist money emerges from this relation
      c) therefore it is inappropriate to assume any important continuity with earlier, pre-capitalist (that is pre-wage labor) forms of money

      In response I threw out an historical observation: that, surprisingly, almost all the key financial innovations which became typical of capitalism, from stock exchanges to national deficit financing through semi-private central banking systems, to various forms of commercial credit, developed not only before the factory system, but before wage labor was in any way dominant, or really all that significant, as a factor in production for the market. I also observed that free wage labor was never as commonplace as many seem to assume even in Victorian England, let alone in the world system as a whole at that time, and cited Yann Moulier-Boutang’s arguments that there has never been a time when it was the predominant global form. Finally I pointed out this didn’t really contradict Marx’s analysis since he was writing not a work of political economy but a critique of political economy, that is, assuming the somewhat utopian assumptions of the political economists were true and showing that even if they were, the capitalist mode of production would still destroy itself based on fundamental contradictions.”

      “I didn’t expect agreement . But I did expect some engagement. There are lots of potential explanations one can offer, after all. One could argue (a la Brenner) that wage labor was more common in the 16th and 17th centuries than we usually think. Or maybe one could argue as does Jairus Banaji that wage labor is not primarily a matter of free contract at all but of paying the means for workers’ reproduction out of a firm’s income, in such a way that even slaves could be wage labor in a sense. Or one could conclude as I do that free wage labor simply isn’t as central to capitalism as we’d previously assumed.”

      But I did miss the point you make about how this corresponds to your interpretation of Capital:

      “Finally I pointed out this didn’t really contradict Marx’s analysis since he was writing not a work of political economy but a critique of political economy, that is, assuming the somewhat utopian assumptions of the political economists were true and showing that even if they were, the capitalist mode of production would still destroy itself based on fundamental contradictions.

      So whilst I acknowledge the point you make I’m still curious to hear how your and Banaji’s account of capital and the subsumption of non-capitalist types of production converge. Do you address this anywhere?

  2. David Graeber says:

    No, not directly. I generally lean towards a Midnight Notes-style class-struggle version of Marxian political economy, where the internal laws of motion of capital (while real enough as tendencies, as a Critical Realist would put it) also work themselves out only in an overall context of class struggle. I guess I mention Banaji sometimes because while he’s coming from a different tradition, I think he’s addressed these issues in an interesting way and there could be a really useful synergy. Alas, I have not myself done the work.

    Thanks for the generous reply!

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