Crotty, Raymond D. 2001. When Histories Collide: The Development and Impact of Individualistic Capitalism. . .
Ray Crotty was an interesting guy. He was an Irish farmer who observed his own failures and the general problems of farmers around him and then got a formal economics training which he used to explain the things he had observed. He made further observations of practical farming while working in Asia, Latin America and Africa with the World Bank and the UN, where he found similarities between Ireland and other former colonies. He then taught development economics in (of all places) the Statistics Department of Trinity College Dublin. Despite being marginalized by much of the Irish academic community, he had a major impact on critical Irish thought and practice since the 1970s, through his published work and his tireless campaigning against what he viewed to be the negative consequences on Ireland of EU integration. When Histories Collide is published posthumously due to the efforts of Lars Mjoset of the University of Oslo, who worked with and admired Crotty.
This is a two-part book in which Crotty lays out his interpretation of longterm world historical development and then applies his model with respect to Ireland (he also says some comparative things about North and South America and other colonised regions). He has a novel ecological theory of the origins of Western ‘individualist capitalism’, based on the ways in which pastoral migrants interacted with different factor endowments to develop specific systems of property relations and production/reproduction.
In the first half of the book, Crotty unfolds his basic historical analysis of the twin processes of ‘individualist capitalist development’ and ‘capitalist colonial undevelopment’. Both processes are centred on the introduction of property. But private property (the identifying institution of individualistic capitalism) emerged autochthonously in Europe, and was thus a developing factor by inducing productivity in the limiting factor of production, but was ‘undeveloping’ when it was imposed onto collectivist societies. There, it worked only to the advantage of a privileged class that was identified with the metropolis and the masses of people sank into deep poverty.
Crotty’s historical model unfolds something like clockwork, although it is a very long clock. Nomadic Indo-European pastoralists who were lactose tolerant attained an advantage over farmers because they could drink milk and eat milk products when other sources of food failed. This enabled them to produce a surplus population, leading to invasions of different regions of Asia and Europe around 2000BC. The invasions produced different outcomes according to the ecology of each region/society (note that Crotty’s ‘world-system’ begins at about the same time as that of Frank, but it proceeds very differently according to Crotty’s definition of individualist capitalism). In China, India and the Near East they did not produce capitalism. But invasions into Europe created individualistic constellations, in which the institutions of individual property emerged.
These European constellations took two forms. In southern Europe, conditions were such that the individual reproduction was possible only by extracting a surplus from slaves, so ‘individualist slavery’ emerged. The individualist slaveholder expanded extensively, by capturing more slaves, and the system expanded aggressively until it had to move northward. There, in central-western Europe, it was undermined by a more productive economy where individualism took a different and capitalist form because neither land nor labor was the limiting factor. The individualist farmer was able to adapt in a productive way to the environment by developing private property rights in capital (cattle, shelter, crops, food).
After these populations competed with each other for three millennia, the system exploded. Capitalist colonialism emerged as Spain and Portugal extended slave-based agriculture outward into the world-system. And the Tudors in England introduced property rights in land, which, together with the stimulus from the first outward movement of colonialism, provided the conditions for the rise of factory capitalism. England, however, was purely exceptional because it is the only place where property that was primarily in land developed autochthonously. The result was singularly ‘developing’ for England in an industrial sense, but because of the landed form of private property the English masses paid for its development and world leadership by enduring impoverishment for four centuries before they shared in the prosperity.
From this point, the rapid surge of individualist capitalist colonialism created two outcomes. In settler colonies like North America, where the indigenous populations could be largely swept away and land was virtually limitless, property was imposed and maintained by the settlers themselves. As in central Western Europe (but not England), they achieved development primarily on the basis of property in capital. Th e non-settler colonies, Crotty argues, were the only areas apart from England where property was based primarily in land. Since this was not an autochthonous development, property relations were forcibly maintained by the metropoles ‘for squeezing the colonized nations’ (P.121). Land that was previously used for popular sustenance now became a source of profit for agents and collaborators of the metropoles and the local people were squeezed and had no way to avoid sinking into poverty. This is the essence of Crotty’s ‘capitalist colonialist undevelopment.’
Th e second half of the book concentrates on how this model of historical development applies to the Irish case. The ‘capitalist colonization’ of Ireland began with the imposition of private property in land after the Tudor conquest. Eventually, the combination of cheap land, ecological conditions and changing demands in the metropolis led in 1820-1921 to the collapse of the Irish economy after a collapse in grain prices throughout Europe and, then, the potato blight of the 1840s, causing widespread famine (over a million died), depopulation and poverty.
Crotty discusses the ‘aftermath of capitalist colonialism’ to make his analysis speak to the current needs for change in colonized regions like Ireland. His central theme is that independence is obtained in capitalist colonies only when the metropolitan-oriented elite is sufficiently strong and the colonized mass sufficiently debilitated to ensure the perpetuation of ‘undevelopment’ in the post-colonial period. Crotty calls this the ‘essential continuity’ of capitalist colonialism. When he wrote When Histories Collide, the Irish Celtic Tiger economy of the 1990s had not yet emerged. Ireland was mired in poverty, one in five was unemployed, the state was one of the most indebted in the world and it appeared as though dependence on foreign investments would be insufficient to change any of this.
Despite his pessimistic analysis, Crotty has a pretty simple way out of undevelopment that only requires substantial national mobilization. To reverse undevelopment, he argues, one must deprive the state, ‘the enemy of the nation’, of its control of the nation’s resources; then one must recognize and implement the nation’s title to these resources. His argument for doing this is a strange mix of populism and neoclassical economics. Since he argues that the central problem of undevelopment is the legacy of free land (for those who have it), cheap capital and expensive (although low-paid) labour, his solution is market-led. He proposes that a ‘national dividend’, a large guaranteed income transfer to all residents of the state, would increase the supply of labour and cheapen it by eliminating the ‘poverty trap’ where wages are too low to induce anyone to forego their state welfare benefits. A land tax would force holders of the land to use it more productively or dispose of it to someone who will. And restoration of sufficiently high profit and capital taxes would increase the cost of capital, forcing its productive use in some cases and its substitution by labour in others. The thrust of each of these proposals is to develop institutions that will realign factor prices in a way that will ensure their efficient use to the benefit of the mass of people. In other words, Crotty suggests that ‘market-led individualistic capitalism’ can be introduced successfully in post-colonies with the right policies.
This is a startling conclusion in two respects (apart from his eliding of the problems of Western poverty and inequality). First, such a simple market-based solution seems to be out of sync with a long historical analysis that centers on the embedding of institutions over the millennia, in a way that appears to be pretty unshakeable due to the powerful class alliances that underpin and benefit from those institutions. Second, it all seems dated, anyway, after a decade of rapid economic growth in Ireland that seems to defy any long history.
One wonders what Crotty would have made of the Celtic tiger. I think he would have been hampered by the fact that his historical model, interesting as it is, lacks sufficient interior analysis of different phases or cycles of undevelopment, as we find, for instance, in the work of Arrighi. He thus has difficulty recognising the changes that have taken place in post-colonial Ireland (and in some other regions) to move it away from its agrarian past. Nonetheless, Crotty’s is a rewarding long historical analysis and a serious alternative (or addition) to others. And I suspect, if he were with us today, he would insist that the ‘essential continuity’ of capitalist colonialism is proven by the fact that, in spite of Ireland’s recent economic growth, many of its basic inequalities have remained.
