Karl Marx’s ideas about economic crises addressed the circumstances of 19th century capitalist development. In his critique, he identified an inherent contradiction in capitalism: a situation in which exploited and underpaid workers are unable to consume everything that is being produced. Marx foresaw that this state of affairs would lead to insufficient profits for business and insufficient revenue for the state, and, thus, a terminal crisis of overproduction. In this way, from a Marxist perspective, capitalism carries the seeds of its own destruction.
An economic crisis of this nature is highly unlikely to occur in a world of easy consumer credit and globalised trade, and in circumstances where many liberal states intervene (to a greater or lesser extent) in employer-employee relations and in financial markets. Furthermore, capitalism has been infinitely creative in restructuring itself in order to alleviate or sidestep all sorts of potential crises. Such innovations extend from technological revolutions such as IT, to strategic corporate alliances. These adaptations have allowed economic growth to be broadly maintained since the early 1950s.
Another problem with Marx’s crisis theory is that it also overlooks the reality that many of the most pressing socio-economic problems we face today have environmental origins. Interestingly, and perhaps surprisingly, in the past 20 years or so some Marxist writers have incorporated the ecological dimension into their thinking. And if we do give Marxist crisis theory an ecological twist, we come up with some fresh and very useful insights.
O’Connor’s crisis theory – the second contradiction of capitalism
The necessary pre-conditions of productive industry are (i) the natural environment; (ii) the physical, mental and emotional well-being of workers and their families; and (iii) the infrastructure and social capital of the communities in which workers live. Any damage to these pre-conditions threatens capitalism’s productive capacity and, therefore, profits. However, James O’Connor maintains that it is in the very nature of capitalism to exploit, impair and even destroy them ; this is what he calls the ‘second contradiction of capitalism’.
For example, the generalised ecological degradation brought on by pollution, overexploitation of natural environment, etc, progressively destroys the natural resource base that business relies upon for production. O’Connor predicts this will generate an ecological crisis that will impact on business as it leads to underproduction and insufficient profits. While the crisis stems from a failure of the state to exert its power to restrict resource use and control polluting activities, it would be regarded more significantly as a failure of the state to maintain economic growth.
One important flaw in this conception of ecological crisis, from a green perspective, is that it reduces the environment to its economic value only . However, it appears that the fear of this type of crisis drives much government policy, because many business and most state agencies themselves only recognise the economic value of the environment. As a crisis of underproduction would indeed severely damage prospects for economic growth, the response of governments, international institutions, NGOs and business has been the idea of sustainable development. At the same time it is always insisted that growth will not and must not be impaired by the new policy instruments of sustainable development. From the capitalist point of view of business and the state, this is only logical: nothing is permitted to rein in growth.
What we have in sustainable development, then, is the latest creative restructuring of capitalism in the face of an imminent crisis. What will this mean for capitalism? And what will it mean for the natural world?
In the ecosocialist journal Capitalism Nature Socialism, Timothy Luke presents an analysis of sustainable development that extends the insights gained from O’Connor’s theory . In his article, Luke describes how the crisis-induced reorientation of capitalism to sustainable development is being manifest as ‘ecomanagerialism’, ‘ecocommercialism’ and ‘ecojudicialism’.
Luke uses the term ‘ecomanagerialism’ to describe the shift of corporate thinking about environmental issues into more positive ‘environmentally friendly’ channels. This shift has occurred with the gradual acceptance of the natural world as one of the necessary pre-conditions of any profitable business enterprise. For example, environmentalists have worked hard over many years to move the business approach to resource exploitation away from ‘sustained maximum yield’ and towards sustainability; successes have been achieved through a combination of activism, resource management legislation, tradeable quotas, global competition, and bench-marking and eco-labelling. Extensive monitoring is also part of the picture, as it is a necessary part of maintaining keeping sustainable business practices on track.
Overall, the shifts in attitudes and practices embodied by ecomanagerialism have effectively blunted calls for more radical green economic alternatives and at the same time have allowed society to maintain its aspirations for continuing growth and expanding consumption.
Ecocommercialism: nature as services
The acceptance of the natural world as one of the necessary pre-conditions of any profitable business enterprise also sees the functions of the natural world (eg, the processing and recycling of wastes, and the maintenance of planetary climate) reframed as “ecosystem services” (p.104). The new departure here is that economic values are being assigned to these services for the first time in human history. Market based mechanisms such as emission credits have commercialised these services and thus permitted business to take modest steps towards sustainability. This is ‘ecocommercialism’ or, as Luke also puts it, the attempt to simultaneously engineer “economic solutions to preserve the earth and pump up profits” (p.105).
The confusion of opinion and motive, theory and data, tradition and political grandstanding that surrounds many environmental battles as they are fought out in the public arena almost always creates an impasse. Since the 1960s, therefore, many environmental issues have been resolved by court decisions based on liberal capitalist property laws and business, commercial and environmental legislation. According to Luke, this ‘ecojudicialism’ has some important benefits for environmentalists, such as due process, and accountability for substandard behaviour by state agencies and corporations. In particular, it gives civil society an opportunity to respond to hasty business decisions in a way that may not be possible without these judicial procedures.
I feel Luke’s points about ecojudicialism have merit but they are overplayed. From a practical perspective, many individuals and communities are put off by the very process that Luke suggests is such a benefit. The arcane and mysterious world of the law does a great job of scaring people off and the likely expense of the process is a further very effective deterrent.
There is another, deeper issue here too. The world of law courts and parliaments operates largely on a one-dimensional technocratic vision of both the natural world and human society. It must be borne in mind that successes in that realm are similarly one-dimensional, and that ecology as politics embraces far, far more than can ever be captured in the narrow, instrumental worldview of sustainable development.
Timothy Luke sees the technocratic tools of ecomanagerialism, ecocommercialism and ecojudicialism as embodying “efforts to manage and mitigate the damage inflicted upon nature” in ways that represent the ecological crisis as “manageable within the current parameters of capitalism” (p.101). He also recognises that this is a more progressive attitude to nature than held sway through much of the 20th century; and from an ecological perspective, it must be said that this is certainly better than nothing. Despite the undoubted advances though, “the existing socioeconomic and social ecological inequality of commodity production and consumption remains unaddressed” (p.101) and the goals of capitalism remain unaltered under sustainable development – it is just that the path to achieving them is a little longer.
For this reason, Timothy Luke is adamant that ‘sustainable development’ is ultimately neither sustainable nor development. “Ecological degradation is not halted; it is instead measured, monitored, and manipulated within certain tolerances” and therefore, within capitalism, “ecological degradation perversely acquires its own sustainability” (p.100).
Consequently, for Luke, sustainable development must be reframed as ‘sustainable degradation’.
 James O’Connor (1988) Capitalism, nature, socialism: A theoretical introduction. Capitalism Nature Socialism, 1, 11-39.
 Brent K Marshall and Warren S Goldstein. (2006) Managing the environmental legitimation crisis. Organization & Environment, 19, 214-232.
 Timothy W Luke (2006) The system of sustainable degradation. Capitalism Nature Socialism, 17(1), 99-112.