By K. Khubeev
Professor of Economics
Dean of Post-graduated school

The appearance of the book 'Capitalism today and Capitalism tomorrow' by Ilya Stavinsky one may consider as an unusual event in the economic science. Not because its author is an American economist, who graduated Moscow University more than 25 years ago, nor because the book attracted the attention of Bill Clinton and an "Australian" newspaper and several other magazines in Europe and the USA, but because its content and ideas.

Although the book is written in a classical style and in popular form, nonetheless the problems it considers are quite serious and complicated. For example, the growth of production, full employment, inflation, the economic consequences of an automation and robotization, negation of competition and commodity circulation etc, are considered .

The central idea of the book is the 'social capital'. The author discovers and proves the existence of this category in a quite logical way by investigation of the concentration of monopolies with vertical integration. Contemporary and particularly future capitalism is characterized by the development of automation and robotization, which in turn, will lead to higher productivity of labor and to the diminishing of employment. The latter in turn leads,besides the growth of unemployment, to the reduction of demand and as result to the reduction of profits of monopolies, which under high productivity of labor can satisfy the market in a very short period of time with half capacity of their production being used.. For this reason capitalism will draw in a specific crisis situation where the production of profit will lose its economic meaning. One can not close one's eyes on such complicated problems - they must be addressed.

Besides the concentration of the capitalist production moving to the new form of 'social capital', the author shows how the latter will come into existence. And here one becomes surprised by this very interesting scientific metamorphosis. The contradiction between private and social capital is resolved by creation of one stockjoint company where all stocks of private companies are exchanged for stocks of the social capital. The social capital will regulate the degree of involvement of equipment in each branch of production in order to satisfy direct wants of the whole population of the country.

Why only direct wants of the people ? And in this context more unusual conclusions come to the surface. Within social capital there is no commodity exchange. The branches producing the means of production supply them to the branches producing articles of consumption to replace or expand the old one. (input - output conception). Competition disappears. The production of profit in value form as a goal, will loose its economic meaning.

Of course the cascade effect of these conclusions will shock any marginalist. If one recognizes the logical analysis and conclusion the author came to, then that branch of economic theory which collectively is as neo-classical economics will go down the drain. Indeed what happen to it, if the growth of productive force refutes the marginalist law of diminishing marginal productivity and what is more the social capital liquidates the competition which is out of-date method of increasing productivity.

The question is how without competition will the capitalists l produce a profit? Very simple. Each capitalist will get a dividend proportionally to the number of stocks one owns. Under social capital the production of profit completely is transferred into branches engaged directly in production of articles of consumption. The production of profit in other branches disappears, (becomes a history). For example, if social capital produced the means of production then the social capitalist understands very clearly that he produced only the means of production for replaceing them in branches producing articles of consumption or means of production, but he did not produce yet any profit which can be used directly as revenue. Social capital inherited from private capital is only one kind of profit existing in articles of consumption.

Deciding to what degree to use different branches of the social capital in order to produce social profit, social capital resolves the problems of unemployment by reducing the length of the working day and the retirement age. In that relation the author criticize the position of some politicians and economists who suggest that we extend the retirement age.

The author uses exhaustive statistical material to support his argument about social capital. The reader who has respect for the classical school of political economy, will find this book is very interesting and will answer many economic problems. This book 'Capitalism today and Capitalism tomorrow' demonstrates that the resources and methods of classical analysis are not yet exhausted in the investigation of the developing economic systems.

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