10 SOCIAL SCIENTIST very law of development of capitalism- is that of a development of output potential far out of line with the purchasing power of the workers, who comprise the bulk of the consuming population. Thus one component of Keynesian aggregate demand lags further and further behind potential output because of the very nature of capitalist production. The other component of effective demand, namely, investment, is related ultimately to the growth of consumption demand relative to output capacity- Since consumption demand relative to output capacity falls because of the very nature of capitalism, so does investment demand. During a boom, investment demand temporarily picks up in anticipation of growth of consumption demand, until productive capacity outstrips the anticipated demand, and recession sets in, throwing workers out of employment and reducing consumption demand further. Thus, during a recession, the "propensity to consume" and the "inducement to invest" are low because of the recession itself; and it is not that the recession is caused by a low "propensity to consume'9 and a low "inducement to invest55. Thus a mere principle of effective demand without a scientific theory of value that can explain the nature of profit under capitalism is a principle that says, there is recession because of recession. It is true, but a useless piece of truism. On the other hand, a proper understanding of the nature of capitalism leads to the logical conclusion that the tow level of effective demand i^ inseparably tied to the very nature of capitalism. Marx's discussion of the problem of realization, coming as it does with a scientific theory of value, thus becomes a scientific theory capable of both diagnosing the ailments of capitalism as well as of providing a prognosis of its destiny. The group of Keynesians who see the effective demand principle per se as a scientific doctrine are thus mixing up a scientific theory with a logical truism. They have attempted to underplay the distributional aspect of Keynes's theory, which is commendable, but they have failed to substitute it with a scientific theory of value. This has led them to cherish the naive wishfulness that the propensity to consume can be altered so much as to make capitalism workable. Their failure to understand the nature of capitalism makes them believe that distribution can be altered to the point of eliminating the basic contradiction of capitalism, and thence to the related error, that therefore capitalism not only can be but should be preserved. In a nutshell, their position can be summarized by saying that because capitalism is what it is not, it can be and ought to be preserved. It is curious that these economists are not only ignorant of their basic error but in fact make a virtue of this error by asserting that Marx's economics could be scientific if it consisted only of his discussion of realization and related topics (volume 2 of Capital), but that this scientific element has been marred by his