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Henryk Grossman (alternative spelling: ''Henryk Grossmann''; 14 April 1881 – 24 November 1950) was a Polish economist, historian, and Marxist revolutionary active in both Poland and Germany. Grossman's key contribution to political-economic theory was his book, ''The Law of Accumulation and Breakdown of the Capitalist System'', a study in Marxian
crisis theory Crisis theory, concerning the causes and consequences of the tendency for the rate of profit to fall in a capitalist system, is associated with Marxian critique of political economy, and was further popularised through Marxist economics. Histo ...
. It was published in Leipzig months before the Stock Market Crash of 1929.


Early life and education

Grossman was born as Chaskel Grossman into a relatively prosperous Polish-Jewish family in Kraków, Poland (then part of
Austrian Austrian may refer to: * Austrians, someone from Austria or of Austrian descent ** Someone who is considered an Austrian citizen, see Austrian nationality law * Austrian German dialect * Something associated with the country Austria, for example: ...
Galicia). Although his parents were assimilated into Krakow society, they nevertheless ensured their sons were circumcised and registered as members of the Jewish community. His father died at the age of 54 when Henryk was 15. He joined the socialist movement around 1898, becoming a member of the
Social Democratic Party of Galicia Polish Social Democratic Party of Galicia ( pl, Polska Partia Socjalno-Demokratyczna Galicji) was a political party in Galicia. The party was formed in 1890 as the Galician territorial organization of the Social Democratic Workers Party of Austri ...
(GPSD), an affiliate of the
Social Democratic Workers' Party of Austria The Social Democratic Party of Austria (german: Sozialdemokratische Partei Österreichs , SPÖ), founded and known as the Social Democratic Workers' Party of Austria (german: link=no, Sozialdemokratische Arbeiterpartei Österreichs, SDAPÖ) unti ...
. The GPSD, led by Ignacy Daszyński, was formally Marxist, but dominated by
Polish nationalists Polish may refer to: * Anything from or related to Poland, a country in Europe * Polish language * Poles, people from Poland or of Polish descent * Polish chicken *Polish brothers (Mark Polish and Michael Polish, born 1970), American twin screenwr ...
close to the
Polish Socialist Party The Polish Socialist Party ( pl, Polska Partia Socjalistyczna, PPS) is a socialist political party in Poland. It was one of the most important parties in Poland from its inception in 1892 until its merger with the communist Polish Workers' ...
(PPS). When the Ukrainian Social Democratic Party in Galicia (USPD) was formed in 1899, the GSPD became the
Polish Social Democratic Party Polish Social Democratic Party of Galicia ( pl, Polska Partia Socjalno-Demokratyczna Galicji) was a political party in Galicia. The party was formed in 1890 as the Galician territorial organization of the Social Democratic Workers Party of Austri ...
(PPSD) and the Polish nationalist current was strengthened. Grossman led the resistance of
orthodox Marxists Orthodox Marxism is the body of Marxist thought that emerged after the death of Karl Marx (1818–1883) and which became the official philosophy of the majority of the socialist movement as represented in the Second International until the Fir ...
to this current. Along with
Karl Radek Karl Berngardovich Radek (russian: Карл Бернгардович Радек; 31 October 1885 – 19 May 1939) was a Russian revolutionary and a Marxist active in the Polish and German social democratic movements before World War I and a ...
, he was active in the socialist student movement, particularly in ''Ruch'' (Movement), which included members of the PPSD as well as of the two socialist parties in the Kingdom of Poland, the PPS and the Social Democracy of the Kingdom of Poland and Lithuania (SDKPiL – led by
Rosa Luxemburg Rosa Luxemburg (; ; pl, Róża Luksemburg or ; 5 March 1871 – 15 January 1919) was a Polish and naturalised-German revolutionary socialist, Marxist philosopher and anti-war activist. Successively, she was a member of the Proletariat part ...
and
Leo Jogiches Leon "Leo" Jogiches (Russian: Лев "Лео" Йогихес; 17 July 1867 – 10 March 1919), also commonly known by the Pseudonym, party name Jan Tyszka, was a Polish Marxism, Marxist revolutionary and politician, active in Poland, Lithuania, an ...
). He was the main figure in the newspaper ''Zjednoczenie'' (Unification), which took a line close to the SDKPiL, against the pro-PPS politics of ''Ruch''s main organ, ''Promień'' for which he was censured by the PPSD and its newspaper ''Naprzód''. During this period, Grossman learned
Yiddish Yiddish (, or , ''yidish'' or ''idish'', , ; , ''Yidish-Taytsh'', ) is a West Germanic language historically spoken by Ashkenazi Jews. It originated during the 9th century in Central Europe, providing the nascent Ashkenazi community with a ve ...
and became involved in the Jewish workers' movement in Kraków. Grossman was the founding secretary and theoretician of the
Jewish Social Democratic Party The Jewish Social Democratic Party in Galicia ( yi, יידישער סאציאל-דעמאקראטישער פארטיי אין גאליציען, ''yidisher sotsial-demokratisher partey in galizien'', pl, Żydowska Partia Socjal-Demokratyczna, abbre ...
of Galicia (JSDP) in 1905. The JSDP broke with the PPSD over the latter's belief that the Jewish workers should assimilate to Polish culture. It took a position close to the Bund, and was critical of the
labour Zionism Labor Zionism ( he, צִיּוֹנוּת סוֹצְיָאלִיסְטִית, ) or socialist Zionism ( he, תְּנוּעָת הָעַבוֹדָה, label=none, translit=Tnuʽat haʽavoda) refers to the left-wing, socialist variation of Zionism ...
of the Poale Zion as well to assimilationist forms of socialism. The JSDP sought to affiliate to the Social Democratic Workers' Party of Austria (the General Party), but this was refused. However, the JSDP was active alongside the General Party, for example for universal suffrage. Grossman earned his Juris Doctor in 1908 from the Jagiellonian University. At the end of 1908, he went to the University of Vienna to study with the Marxian economic historian
Carl Grünberg Carl Grünberg (10 February 1861 – 2 February 1940) was a German Marxist philosopher of law and history. Biography Born in Focșani, Romania, into a Jewish- Bessarabia German family, Grünberg studied law in Strasbourg and worked as an adv ...
, withdrawing from his leadership role in the JSDP (although he remained on its executive until 1911 and had contact with the small JSDP group in Vienna, the Ferdinand Lassalle Club).Rick Kuhn ''Henryk Grossman and the Recovery of Marxism'' pp. 70–77 With the destruction of the Austro-Hungarian empire at the end of World War I, Grossman became an economist in Poland, and joined the
Communist Party of Poland The interwar Communist Party of Poland ( pl, Komunistyczna Partia Polski, KPP) was a communist party active in Poland during the Second Polish Republic. It resulted from a December 1918 merger of the Social Democracy of the Kingdom of Poland a ...
.


Career

From 1922 to 1925, Grossman was Professor of economics at the Free Polish University in Warsaw. He emigrated in 1925 to escape political persecution. The same year he was invited to join the Marxian
Institute for Social Research The Institute for Social Research (german: Institut für Sozialforschung, IfS) is a research organization for sociology and continental philosophy, best known as the institutional home of the Frankfurt School and critical theory. Currently a pa ...
in Frankfurt by his former tutor Carl Grünberg. Hitler's accession to power in 1933 forced him first to Paris, and then via Britain to New York, where he remained in relative isolation from 1937 until 1949. In that year he took up a professorship in political economy at the University of Leipzig in East Germany. Grossman's ''The Law of Accumulation and Breakdown of the Capitalist System''(1929) despite being one of the first publications of the
Frankfurt School The Frankfurt School (german: Frankfurter Schule) is a school of social theory and critical philosophy associated with the Institute for Social Research, at Goethe University Frankfurt in 1929. Founded in the Weimar Republic (1918–1933), duri ...
was only made available in English translation in 1979 by Jairus Banaji, for an Indian Trotskyist organisation, the Platform Tendency. A recent edition is: . However, it is a condensed version and lacks the important concluding chapter of the German original.


Contribution to theory

While at Frankfurt in the mid-1920s, Grossman contended that a "general tendency to cling to the results" of Karl Marx's theory in ignorance of the subtleties of "the method underlying ''
Capital Capital may refer to: Common uses * Capital city, a municipality of primary status ** List of national capital cities * Capital letter, an upper-case letter Economics and social sciences * Capital (economics), the durable produced goods used fo ...
''" was causing a catastrophic vulgarisation of Marxian thought, a trend which was undermining the revolutionary possibilities of the moment. ''The Law of Accumulation'' was his attempt to demonstrate that Marxian political economy had been underestimated by its critics and by extension that revolutionary critiques of
capitalism Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, private pr ...
were still valid. Amongst other arguments, it sets forth the following demonstration (for a complete definition of the terms employed, the whole book is recommended):


Logical and mathematical basis of the law of breakdown

Apart from the arithmetical and logical proofs that we have been given already, mathematicians may prefer the following more general form of presentation which avoids the purely arbitrary values of a concrete numerical example. ; Meaning of the symbols '' c '' =
constant capital Constant capital (c), is a concept created by Karl Marx and used in Marxian political economy. It refers to one of the forms of capital invested in production, which contrasts with variable capital (v). The distinction between constant and vari ...
. Initial value = ''co''. Value after ''j'' years = ''cj''
'' v '' =
variable capital Constant capital (c), is a concept created by Karl Marx and used in Marxian political economy. It refers to one of the forms of capital invested in production, which contrasts with variable capital (v). The distinction between constant and vari ...
. Initial value = ''vo''. Value after ''j'' years = ''vj''
'' s '' = rate of surplus value (written as a percentage of ''v'')
'' ac '' = rate of
accumulation Accumulation may refer to: Finance * Accumulation function, a mathematical function defined in terms of the ratio future value to present value * Capital accumulation, the gathering of objects of value Science and engineering * Accumulate (highe ...
of constant capital ''c''
'' av '' = rate of accumulation of variable capital ''v''
'' k '' = consumption share of capitalists
'' S '' = mass of surplus value, being: k + + '' Ω '' =
organic composition of capital The organic composition of capital (OCC) is a concept created by Karl Marx in his theory of capitalism, which was simultaneously his critique of the political economy of his time. It is derived from his more basic concepts of 'value composition o ...
, or ''c'':''v''
(Correction with respect to Grossman's text: From the formula below it follows that Grossman means by '' Ω '' the initial value of the organic composition of capital ''c_0'':''v_0'')
'' j '' = number of years Further, let
r = 1 + and let
w = 1 +


Formula

After ''j'' years at the assumed rate of accumulation ''ac'', the constant capital ''c'' reaches the level: c_j = c_ \cdot r^j At the assumed rate of accumulation ''av'', the variable capital ''v'' reaches the level: v_j = v_ \cdot w^j The year after (''j'' + 1) accumulation is continued as usual according to the formula: S = k + + = whence k = - For ''k'' to be greater than 0, it is necessary that: > ''k'' = 0 for a year ''n'', if: = Note this line follows the German original in ''Das Akkumulations- und Zusammenbruchsgesetz des kapitalistischen Systems (zugleich eine Krisentheorie)'' because it is misspecified in the condensed English translation. The timing of the absolute crisis is given by the point at which the consumption share of the entrepreneur vanishes completely, long after it has already started to decline. This means: ()^n = whence ''n'' = \over This is a real number as long as ''s > av'' However, this is what we assume anyway throughout our investigation. Starting from time-point ''n'', the mass of surplus value ''S'' is not sufficient to ensure the valorisation of ''c'' and ''v'' under the conditions postulated.


Discussion of the formula

The number of years ''n'' down to the absolute crisis thus depends on four conditions: # The level of organic composition ''Ω''. The higher this is the smaller the number of years. The crisis is accelerated. # The rate of accumulation of the constant capital ''ac'', which works in the same direction as the level of the organic composition of capital. # The rate of accumulation of the variable capital ''av'', which can work in either direction, sharpening the crisis or defusing it, and whose impact is therefore ambivalent. # The level of the rate of surplus value ''s'', which has a defusing impact; that is, the greater is ''s'', the greater is the number of years ''n'', so that the breakdown tendency is postponed. The accumulation process could be continued if the earlier assumptions were modified: # The rate of accumulation of the constant capital ''ac'' is reduced and the tempo of accumulation slowed down. # The constant capital is devalued which again reduces the rate of accumulation ''ac''. # Labour power is devalued, hence wages cut, so that the rate of accumulation of variable capital ''av'' is reduced and the rate of surplus value ''s'' is enhanced. # Finally, capital is exported, so that again the rate of accumulation ''ac'' is reduced. These four major cases allow us to deduce all the variations that are actually to be found in reality and which impart to the capitalist mode of production a certain elasticity ... Much of the remainder of Grossman's book is devoted to exploring these "elasticities" or counter-crisis tendencies, tracking both their logical and their actual, historical development. Examples of each would include: # Depressed interest rates, investment capital transferred to unproductive speculation, e.g. housing stock, art objects. # Enlarged state sector bleeds value from the accumulation process via taxes. Wars destroy capital values. # The
reserve army of labour Reserve army of labour is a concept in Karl Marx's critique of political economy. It refers to the unemployed and underemployed in capitalist society. It is synonymous with "industrial reserve army" or "relative surplus population", except that t ...
(unemployed) created to discipline wage claims. # Imperialism


Personal life

Grossman lost his immediate family in the Holocaust. His wife Jana and his son Jan were murdered in Auschwitz in 1943. His return to Leipzig was considered in the newly formed
German Democratic Republic German(s) may refer to: * Germany (of or related to) **Germania (historical use) * Germans, citizens of Germany, people of German ancestry, or native speakers of the German language ** For citizens of Germany, see also German nationality law **G ...
to be a success for the regime, and he was nominated by the city of Leipzig in March 1950 for the National Prize 'for the totality of his scientific achievements in the area of scientific socialism', but did not win. He was plagued with ill health and died after suffering with prostate problems and Parkinson's disease.


See also

*
Reproduction (economics) In Marxian economics, economic reproduction refers to recurrent (or cyclical) processes. Michel Aglietta views economic reproduction as the process whereby the initial conditions necessary for economic activity to occur are constantly re-created ...
*
Capital accumulation Capital accumulation is the dynamic that motivates the pursuit of profit, involving the investment of money or any financial asset with the goal of increasing the initial monetary value of said asset as a financial return whether in the form o ...
*
Crisis theory Crisis theory, concerning the causes and consequences of the tendency for the rate of profit to fall in a capitalist system, is associated with Marxian critique of political economy, and was further popularised through Marxist economics. Histo ...
* Tendency of the rate of profit to fall * Surplus value *
Organic composition of capital The organic composition of capital (OCC) is a concept created by Karl Marx in his theory of capitalism, which was simultaneously his critique of the political economy of his time. It is derived from his more basic concepts of 'value composition o ...


References


Further reading

* Kuhn, Rick (ed.)
Henryk Grossman Works, Volume 2: Political Writings
' Brill, 2020 * Kuhn, Rick (ed.)
Henryk Grossman Works, Volume 1: Essays and Letters on Economic Theory
' Brill, 2018 * Freudenthal, Gideon and Mclaughlin, Peter (editors) ''The Social and Economic Roots of the Scientific Revolution: Texts by Boris Hessen and Henryk Grossmann'' Springer 2009 * Grossman, Henryk ''The Law of Accumulation and Breakdown of the Capitalist System'' Pluto 1992 * Kuhn, Rick ''Henryk Grossman and the Recovery of Marxism'' Urbana and Chicago: University of Illinois Press, 2007. * Grossman, Henryk
017 Seventeen or 17 may refer to: *17 (number), the natural number following 16 and preceding 18 * one of the years 17 BC, AD 17, 1917, 2017 Literature Magazines * ''Seventeen'' (American magazine), an American magazine * ''Seventeen'' (Japanese ...
''Capitalism’s Contradictions: Studies in Economic Theory before and after Marx'' Ed. Rick Kuhn, Trans. Birchall, Kuhn, O’Callaghan. Haymarket, Chicago. * Scheele, Juergen ''Zwischen Zusammenbruchsprognose und Positivismusverdikt. Studien zur politischen und intellektuellen Biographie Henryk Grossmanns (1881–1950)'' Frankfurt a.M., Berlin, Bern, Bruxelles, New York, Wien: Peter Lang, 1999. .


External links

* Grossman, Henryk
The Henryk Grossman Internet Archive
A collection of Grossman's writings. * Grossman, Henry
''Fifty years of struggle over Marxism 1883‐1932''
* Harman, Chris
"Forgotten treasure: a new biography of Grossman"
''International Socialism'', No. 114, Spring 2007. A review of Kuhn's Grossman biography. * Heartfield, James
"Why Grossman still matters"
''Spiked Review of Books'', No. 3, July 2007. Another review of Kuhn's Grossman biography. * Kuhn, Rick

''Socialist Review'', No. 245, October 2000. A short biography of Henryk Grossman. * Kuhn, Rick
"Economic crisis and socialist revolution: Henryk Grossman's Law of accumulation, its first critics and his responses"
preprint version of an essay in Paul Zarembka and Susanne Soederberg (eds) ''Neoliberalism in crisis, accumulation and Rosa Luxemburg's Legacy'': ''Research in Political Economy'' 21 Elsevier, Amsterdam 2004 pp. 181–22. A discussion of aspects of Grossman's contribution to the Marxist theory of economic crisis. * Kuhn, Rick
"Henryk Grossman and the recovery of Marxism"
preprint version of an article in ''Historical Materialism'' 13 (3), 2005. On Grossman's contributions to and place in the history of Marxism. * Kuhn, Rick
"Henryk Grossman – Capitalist Expansion and Imperialism"
, ''International Socialist Review'', No. 56, November 2007. On the relevance of Grossman's analysis for understanding globalisation and the current crisis.
"On Henryk Grossman, A Revolutionary Marxist: An Interview with Rick Kuhn"
''Radical Notes'', 9 April 2007 * Mattick, Paul
"Economic Crisis and Crisis Theories"
1974. (The book places Grossman's work in the context of other theories of economic crisis.) {{DEFAULTSORT:Grossman, Henryk 1881 births 1950 deaths Writers from Kraków Jews from Galicia (Eastern Europe) Polish Social Democratic Party of Galicia politicians Jewish Social Democratic Party in Galicia politicians Jewish socialists Communist Party of Poland politicians German economists German Marxists German communists Polish economists Polish Marxists Polish communists Marxian economists Marxist theorists Leipzig University faculty