Aside from the reality of periodic crises that break out on the basis of industrial cycles, the changes in the pace of capitalist development over long periods have continuously preoccupied Marxists as well. There have been many debates concerning the fluctuations in the curve of capitalist development that have been identified to occur over the course of decades. In these debates there have been certain conceptions developed in an effort to deepen the understanding of the workings of capitalism, without drifting away from basic tenets of Marxism. But there have also been other interpretations that are at variance with foundations of Marxism, leading to various misconceptions. The analysis of “long waves” that will be discussed below belongs to the latter category. Let us underline an important point to prevent any misunderstanding regarding the target of criticism. To be able to comprehend concrete fluctuations in the curve of capitalist development, it is of importance to analyse long periods with different characteristics. There is nothing to criticise about it. What deserves criticism, however, is the type of “long waves” theory which, in effect, is used in place of periodic long cycles, as seen in the case of Kondratiev.
Marx remarks that the industrial cycle is of such a nature that the same circuit must periodically reproduce itself, once the first impulse has been given. Engels attached an important footnote to Marx’s remark, saying that following the crisis of 1867, the former ten-year cycles seemed to be have given way to a more chronic and drawn-out form that found its expression in the alternation between a relatively short and weak improvement in trade and a relatively long and indecisive depression. The conclusion to be drawn from this remark was not a new sort of analysis of crises or business cycles. Indeed, Engels continues: “But perhaps it is only a matter of a prolongation of the duration of the cycle.” And further: “In the early years of world commerce, 1845-47, it can be shown that these cycles lasted about five years; from 1847 to 1867 the cycle is clearly ten years; is it possible that we are now in the preparatory stage of a new world crash of unparalleled vehemence?” Engels goes on to answer this question by pointing out that there were many signs indicating this way. With this, he wishes to explain that crises were showing a tendency to become more severe, as previously pointed out by Marx. Engels was right. As the capitalist mode of production proceeded in the effort to surpass the barriers of private property and national boundaries that stand in its way, this historic tendency manifested itself more and more dramatically.
Engels’s remark on the dramatic changes in the aftermath of the 1867 crisis was to draw Parvus’s attention several years later. Parvus, quoting the term “sturm und drang” from Marx, pointed out that there could be longer “storm and stress” periods in the workings of capitalist economy in addition to the usual industrial cycles. In the aftermath of the First World War, long waves became a subject of debate in the Soviet Union.
Among the issues dealt with during the Third World Congress of the Comintern, held in 1921, was the world economic crisis. Examining the question of capitalist development in his report, Trotsky explained that the curve of economic development is a composite of two movements: “a primary movement which expresses the general upward rise of capitalism, and a secondary movement which consists of the constant periodic oscillations corresponding to the various industrial cycles.” Trotsky further explained that the cyclical fluctuations blend with the primary movement of the capitalist curve of development and consequently, in periods of rapid capitalist development, crises have a brief and superficial character, whereas the booms are long-lasting and far-reaching. In periods of capitalist decline, however, the crises have a prolonged character while the booms are fleeting, superficial and speculative.
The point remarked by Parvus was clearly used as a point of departure by Trotsky in his report, who wrote: “In citing Engels it is very dangerous to overlook these basic facts. For it was precisely after 1850, when Marx and Engels made their observations, that there set in not a normal or regular situation, but an era of capitalist Sturm und Drang (storm and stress) for which the soil had been cleared by the Revolution of 1848. ... At issue here is not whether an improvement in the conjuncture is possible, but whether the fluctuations of the conjuncture are proceeding along an ascending or descending curve. This is the most important aspect of the whole question.” He explained, “The acquisition by capitalism of new countries and continents, the discovery of new natural resources, and, in the wake of these, such major facts of ‘superstructural’ order as wars and revolutions, determine the character and the replacement of ascending, stagnating, or declining epochs of capitalist development.”
However, Kondratiev drifted away from this conception following the Third Congress of Comintern. Based on statistics and mathematical models, he endeavoured to prove the existence of long term periodic cycles in addition to the ordinary boom-collapse cycles, which made him known as the founder of the “long waves” theory. In his view, in addition to the “small cycles” spanning periods of 10 years, there were also “big cycles” lasting around 50 years, divided into two nearly equal halves - a downswing and an upswing. This was an erroneous conception, which was therefore to receive Trotsky’s criticism for being an erroneous generalisation based on a formal analogy: “It is already possible to refute in advance Professor Kondratiev's attempt to invest epochs labeled by him as major cycles with the same ‘rigidly lawful rhythm’ that is observable in minor cycles.”
Under the influence of Trotsky’s critical remarks on the long cycles, Kondratiev replaced the term with long waves from 1926 onwards. But, Trotsky’s criticism was not confined to the term at stake, but basically directed towards the content of the analysis. What he principally emphasised was that sudden turning points of long-term motion, unlike the industrial cycles, could not be explained by the internal laws of the economy, and that unlike the industrial cycles, a kind of long waves theory based on the rhythm of renewal of fixed capital was incorrect.
Although Kondratiev abandoned the term he had initially used, he preserved his manner of approach to the question. He continued criticising the Marxist explanation of long-term motion of the capitalist economy. Marxist analysis had already laid bare the fact that the curve of capitalist development takes shape under the influence of irregular and non-economic factors such as wars, revolutions, technical innovations, and the integration of newcomer countries into the world market. In Kondratiev’s view, however, such factors were not the causes but the results. For instance, the integration of newcomer countries into the system did not cause a long-term upswing; but, on the contrary, new areas were absorbed as a consequence of an upward trend caused by the economic operation of the system.
There is nothing wrong with distinguishing the periods of economic operation according to their peculiar characteristics. However, Kondratiev, and also others who adopted his “long waves” theory, neglected the role played by political factors in determining the long-term ebbs and flows of capitalism. They attributed a one-sided and an undue importance to economic factors. For instance, Kondratiev built his “long waves” theory by on the basis of the relationship he established between the renewal of the fixed capital and the investment fund. Yet, the phenomena that cause long-term trends in the operation of the capitalist economy are charactarised by irregularity. Therefore, this kind of ebbs and flows cannot be explained by theories such as “long-term industrial cycles”.
It is obvious that the need to renew and increase the fixed capital requires massive investments. As point of departure Kondratiev takes the assumption that it would take a long time to accumulate enough funds to accomplish such renewal and increase. In his view, the expansion of the funds of capital goods was not a continuous and a regular process. Rather, it was taking place in the form of cyclical upsurges that find their expressions in the long periods of economic activities. For this reason, major inventions had to wait for a period of time, long enough to ensure the accumulation of such capital, say 20 years, before being put into practice on a vast scale. According to this explanation, there exist long cycles that operate on a regular basis, stimulated by the realisation of large-scale investments. The period in which the production of capital goods is on the rise coincides with the upward stage of the cycle.
In an effort to theorise the emergence of technological inventions, Kondratiev argued that they generally occur during periods of economic downturn. Yet, as can be easily reckoned, new inventions can emerge at any time, even though they do not find immediate widespread use. Moreover, the renewal of fixed capital is not distributed equally and simultaneously among countries and industries. In short, in spite of all its scientific-looking mathematical appeal, Kondratiev’s theory is far from demonstrating the existence of a law inherent in capitalist economy that operates on the basis of “long cycles”.
It would be erroneous to regard the halts in the economic growth as a result of inadequate capital accumulation and, thus, of inadequate investment funds. In fact, as pointed out by Marx, economic stagnations arise from overaccumulation of capital, not from capital shortage. Undoubtedly, overaccumulation does not signify an absolute reality, but a relative one. It implies capital that remains idle due to inability to obtain the expected rate of profit. Marx points to superabundance of the mass of capital that is impeded in its reproduction process during crisis periods when everyone has products to sell but cannot sell them, and when the credit is extremely scarce. Thus, a crisis emerges, leading to factory shutdowns, to piling up of raw materials, and to the glutting of the market with unsold commodities. Marx therefore highlights that it would be erroneus to blame the scarcity of productive capital for depression, adding that it is precisely at such times that there is a superabundance of productive capital. “Huge quantities of commodity-capital, but unsaleable. Huge quantities of fixed capital, but largely idle due to stagnant reproduction.”
The question of overproduction, the main signifier of capitalist crises, also signifies overproduction of capital. In order to resolve the crisis, to enter a period of recovery and to leave behind the recession created by overproduction, the capitalist economy is bound to sacrifice some of the capital, leaving it depreciated and discarded. Likewise, introduction of new techniques, which paves the way for recovery through increasing the productivity, entails the moral depreciation of some part of fixed capital before it is physically exhausted.
Hence, the source of the problem is not the shortage of capital accumulation, but rather the stagnations in the revaluation process of capital, arising out of the unplanned character of the capitalist economy. Investors, at first, swarm into profitable areas. But profitability tends to decline over time, aggravating the problem of realisation of the surplus value. All these form the basis whereupon industrial cycle plunges into a crisis. It is also on the basis of these laws of operation that capitalism proceeds over the long run. As remarked by Marx, the curve of capitalist development is fluctuated by tendencies such as the fall of the rate of profit. When the operation of the economy is taken as a whole, it would be seen that each one of the factors examined by Marx, including periodic reinvestment of fixed capital, the question of overproduction, inadequate consumption, the tendential fall of the profit rate, interacts with one another on the basis of a dialectical relationship. Therefore, it has nothing to do with the Marxist attitude to break the integrity of the reality and overemphasise one of the elements, ending up forming schools such as “underconsumptionists” or “falling profit rate-ists” and, at the end, reducing the theoretical struggle to inter-school economic debates, as seen in the cases of some so-called Marxist writers.
Though inspired by this or that interpretation of Marx, the mentality of researchers like Kondratiev bears a strong stamp of bourgeois economists, marked by the desire to compete with them. In fact, the phenomenon of capitalist crisis had already been adequately explained by Marx. The “contributions” that Kondratiev and his likes desired to make, in the final analysis, do not bring further clarity to, but rather blur the subject. Besides, “long waves” type of analysis is characterised by an obsession with hammering away at the ebbs and flows of economy, far from attaching any importance to class struggle, the only way to overthrow the capitalist system. This style, in the final analysis, belongs to the economists. Indeed, it is precisely for this reason that theories of this kind find acceptance among bourgeois economists, being rehashed time and again.
To sum up, there is no basis for claiming that capitalist economy proceeds on the basis of cyclical long waves spanning, say, 30 or 50 years by establishing resemblance with the Marxist analyses of industrial cycles. There is no such inherent law of motion in capitalist system, which can be called “long cycles”, where long periods of upswing and downswing alternate with each other on a regular basis. “Long wave” theory is alien to Marxism as it rules out non-economic factors that are directly involved in the shaping of history and denotes that the course of history is driven by an almost predetermined economic fate.
In an effort to establish a mechanistic link between the course of economic fluctuations and the ebb and flow of class struggle, Kondratiev also maintained that wars and revolutions occur during the upward phase of his “long waves”. But social life, contrary to what Kondratiev and his likes try to deduce, has no regular pattern of rhythm or mathematical accuracy. Trotsky underlines the necessity to combat the mechanistic conception of capitalist decline. The transition from an epoch to another leads to intense frictions in the relations between classes and states. “If periodic replacements of ‘normal’ booms by ‘normal’ crises find their reflection in all spheres of social life,” says Trotsky, “then a transition from an entire boom epoch to one of decline, or vice versa, engenders the greatest historical disturbances; and it is not hard to show that in many cases revolutions and wars straddle the borderline between two different epochs of economic development, i.e. , the junction of two different segments of the capitalist curve.”
The history of capitalism is replete with different types of examples, illustrating the complicated relationship between economic crises and revolutionary situations. Different parts of the world experienced many different revolutionary upsurges during periods of both economic recovery and recession. In some cases where the counter-revolution was successful the capitalist system secured a long period of relief, but, it would be extremely erroneous to attribute this situation to spontaneous fluctuations of the economy. In fact, what all these examples demonstrate is the vital importance of the subjective factor for the victory of the revolution, rather than the role of economic crisis or recovery.
In relation to the debates on “long waves”, another episode may also be worth recalling. Ernest Mandel, who was a prominent figure in the Trotskyist movement, put forward some theses on long waves that aroused interest among academic milieu. Though he did not explicitly ignore Trotsky’s criticism of Kondratiev’s “long cycles”, he was influenced by the latter’s theories. Due to the critiques he recieved regarding this subject, he felt it necessary to repeat time and again that the long periods of capitalist development are not automaticaly determined by economic factors and that one cannot ignore the influence of superstructural factors.
In his explanation regarding the working mechanism of “long waves”, Mandel argues: “A general transformation of productive technology also generates a significant rise in the organic composition of capital and, depending on concrete conditions, this will lead sooner or later to a fall in the average rate of profit.” The reality revealed here, as may be remembered, corresponds to the law of operation of the capitalist industrial cycles. However, as can be seen in the subsequent lines, Mandel devotes much of his effort to prove the existence of a law that operates on a regular basis and regulates the long-term motion of capitalist economy: “The decline of the average rate of profit in turn becomes the greatest impediment to the next technological revolution. The increasing difficulties of valorization in the second phase of the introduction of any new basic technology lead to growing under-investment and increasing creation of idle capital. Only if a combination of specific conditions generates a sudden rise in the average rate of profit will this idle capital, which has slowly gathered over several decades, be drawn on a massive scale into the new spheres of production capable of developing the new basic technology.”
As is evident from this analysis and others alike, Mandel strives to attribute the long-term fluctuations of capitalism to ebbs and flows in the average rate of profit. Trotksy, on the other hand, clearly criticises the attempts at explaining the curve of capitalist development with mere economic factors. Thus, what Mandel’s “long waves” analysis reflects is an effort to find a middle way. According to Mandel, the transition from an expantionist long wave to a stagnating long wave is inevitable due to the tendential fall of the profit rate, which amounts to the idea that there is nothing wrong at this point with explaining the events with economic factors. “It is inevitable that a new long wave of stagnating trend must succeed a long wave of expansionist trend, unless, of course, one is ready to assume that capital has somehow discovered the trick of eliminating for a quarter of a century (if not for longer) the tendency of the average rate of profit to decline.” But, the same does not apply to the transition from a stagnatory long wave to an expansionist long wave, Mandel argues, as such a transformation cannot be explained merely by an automatic motion of economic factors. He adds that non-economic factors, the course of the class struggle and the setbacks suffered by the working class play a role here.
Mandel’s “long waves” theory surely shows differences of emphasis from Kondratiev’s and Schumpeter’s analyses, with the former attaching primary importance to price movements, while the latter bases his analysis solely on technological inventions. At any rate, Mandel brings to the forefront the changes in the rate of profit in an effort to remain loyal to Marx’s analyses. But in the last instance, he fails to prevent his analyses from being infected by the influence of economists such as Kondratiev, Schumpeter and so on. Therefore, his writings regarding the subject contain many generalisations, in which various views, each with a determining role, are put together in an eclectic way. On the one hand, he criticises Kondratiev, quoting Trotsky at length. But on the other hand, he attempts at attributing long-term fluctuations of capitalism to a law that almost amounts to “long cycles”.
In addition to the renewal of fixed capital on the basis of industrial cycles, Mandel argues, there is a fundamental form of renewal based on technological change that occurs in long historical periods. In his view, this type of renewal corresponds to “technological revolution” and forms the objective basis of long waves. He divides the curve of capitalist development, stretching from the late 18th century to 1960s, into 4 long periods, each corresponding to a distinctive form of technology: The industrial revolution with handicraft-operated (and handicraft-made) machines driven by the steam engine; the first technological revolution with machinist-operated (and industrially produced) machines driven by steam engines; the second technological revolution with assembly line combined machines operated by semiskilled machine operators and driven by electric engines; the third technological revolution and electronics, which made non-stop production machines part of semiautomatic systems.
There is no need to further examine the “long waves” theory advocated by Mandel and his co-thinkers. It is clear that the analyses within the scope of this theory contain many misconceptions along with certain truths. But beyond this, the crux of the problem, in our view, lies in the way such questions are dealt with. Undoubtedly, it is a necessity to examine long-term fluctuations in the curve of capitalist development. However, an approach focused merely on displaying one’s knowledge on economy cannot be satisfactory at all. The method employed, the way the theses are substantiated, and whether a clear Marxist stance along with avoidance of eclecticism is adopted are of utmost importance. And above all else, one must subordinate theoretical struggle to the requirements entailed by the duty of organising the working class in a revolutionary way, without giving the slightest credence to academic Marxism, which is incapable of breaking away from bourgeois ideology.
 Nikolai Dmitriyevich Kondratiev was the Director of the Economic Research Institute in Moscow in early 1920s.
 Engels, Capital Vol.3, p. 633.
 Trotsky, “Boom and Crisis”, In Report on the World Economic Crisis and the New Tasks of the Communist International,
 Trotsky, Ibid.
 Trotsky, “The Curve of Capitalist Development”, In Problems of Everyday Life, p.277.
 Trotsky, Ibid, p.276.
 Marx, Capital Vol.3, p.330.
 Trotsky, “The Curve of Capitalist Development”, Ibid, p.276.
 E. Mandel, “Long Waves” in the History of Capitalism, In Late Capitalism, p.120.
 E. Mandel, Long Waves of Capitalist Development, p.23.