ABSTRACT
Analysis of the contradictions of capitalism draws on what is known in political economy as crisis theory and involves a focus on the tendency for the capitalist system to experience recurrent crises. This chapter views, the crisis that beset global capitalism involved the interrelated aspects: overproduction or underconsumption, or what alternatively is known as overaccumulation; global social polarization; the crisis of state legitimacy and political authority and the crisis of sustainability. In past epochs of capitalism the problems of overaccumulation and social polarization were offset, in part, through two processes. One was classical imperialism, or the forcible opening up of new territories and markets by the centers of power in the world capitalist system through military force and wars of conquest. The other process involved diverse redistributive mechanisms developed in the framework of nation-state capitalism culminating in the post-World War II system of Keynesian demand creation.
