Political economy — theoretical and ideological dispute



The importance of the Brazilian Society of Political Economy (SEP)


In the coming weeks we will have the Congress of the Brazilian Society of Political Economy (SEP). Founded in 1996, at the height of Fernando Henrique Cardoso's neoliberal government cycle, this entity brings together the largest group of researchers on heterodox and radical political economy in Brazil. The next meeting of the Brazilian Society of Political Economy SEP will take place for the first time in the Amazon region, in the state of Pará, more precisely in the municipality of Marabá.[I]

Due to the importance of the ideological and theoretical dispute within the so-called economic science and the specificities of the almost continuous process of intervention of economic discourse in society, it is worth establishing some considerations and analyzes of the importance of the aforementioned institution of civil society and the character of the dispute theory that involves the very logic of the existence of this science.

The article that follows seeks to develop three elements that we consider central in the current situation and that are part of both the holding of the Congress of the Brazilian Society of Political Economy, but mainly in the dispute posed in Brazilian and world society over the future of capitalism and human civilization itself. , without any kind of dramaturgy.

Firstly, we seek to elucidate the ideological and technical meaning of what is called economic science, in contrast to the classic term political economy, also observing the diversity of schools and explanatory lines present in the current configuration of economic thought. In a second moment, we will make a brief historical approach to the entity, seeking to socialize the facts that lead to the organization of an alternative entity to the neoclassical hegemonic thinking and fiscal balance prevalent in Brazilian and international academia.

Finally, we establish some conjunctural elements that reinforce the need to oppose any hegemonic thought and that are linked to the maintenance of a double systemic order: the predominance of capitalist gain (profit) over the well-being of society and the use of institutions of the State to maintain the aforementioned systemic order.

The theoretical and historical dispute in political economy

The development of the so-called “economic science” over the last four centuries, taking as a landmark the work of Adam Smith (1776), is established in different schools of thought, diverse theoretical formations and interpretations marked both by differentiated interpretative elements, as well as also, as Hunt (1988, p. 22) denotes, by “cognitive, scientific, as well as (…) emotional, moral or ideological aspects”.[ii] It is worth reinforcing the ideological component and treating it better, as we will do later.

Thus, the different historical constructions in the economy were not properly established as paradigmatic interactions, as Thomas Kuhn (1989) considered in relation to natural sciences, especially physics and chemistry.

The theoretical dispute in the so-called classical political economy has already taken place with the clear character of social class disputes, and the questioning of the classical labor theory of value, developed by Smith and Ricardo, has been doubly attacked: by the conformation of utilitarian logic, which will give rise to the differentiated set of contemporary neoclassical and Keynesian formations and, on the other, the construction of an alternative line that, reformulating the labor theory of value, but maintained the objective nexus of explaining the production of social wealth. We will return to these two major formulations later.

However, the core of economic theory, which changes historically, but maintains analytical elements that are conventionally called neutral and natural, especially neoclassical theory, converges towards a paroxysm that Joseph Schumpter (1964, p. 194) called “economics of economics”. Crusoe-like”, a science based on high formalism, but where only a representative economic agent, “Crusoe”, can “be imagined evaluating his various scarce means of production according to the marginal satisfactions that he knew to be dependent on the possession [of income] respective”.

The analysis of the so-called “vulgar economy”, as Karl Marx (2013, [1867]) called utilitarian authors such as Jean Batista Say and Jeremy Bentham, precursors of the current marginalist neoclassical economy, becomes a necessary point to observe how the theoretical system of the modern economy will be based on mathematical instruments whose axiomatic basis will always be a subjectivist construction, where the factors of societal and historical absence will be the core of explanatory organization, conditioning the models, even if increasingly complex, but simplistic in their axiomatic essence.

Marx already strongly highlighted the demarcations of the difference between “classical political economy” and “vulgar economy”. According to him, classical political economy “investigates the internal structure of bourgeois relations of production”, while “vulgar economics (…) moves only within the apparent context (…) and serves the domestic needs of the bourgeoisie”.[iii]

The economic theory established at the end of the 19th century, around the formulations of Austrian, English and French authors (Manger, Walras, Marshal) established what the Italian author Antônio Gramsci (Ano) called “old economic individualism”, based on the general lines of a “perfectly competitive market”, characterized by the atomicity and homogeneity of firms, fully adjusted to Smith’s “invisible hand”.

However, two elements were added to this edifice of fantastic unrealism that largely organized the way of treating the capitalist economy in the 20th and 21st centuries: the logic of fiscal balance, imposing the existence of a neutral and only normative State and, also, the perspective that market adjustments would be rational enough to stabilize the economy, avoiding its crisis spasms, something sufficient to deal with and respond to the enormous uncertainties characteristic of capitalist society.

As for the first aspect, something central in the justifying construction of every fiscal system in contemporary capitalism, something that Mattei (2023), in his excellent descriptive study of the XNUMXth century, observes that it is part of a common sense of “honest and difficult language” of discourse economic, so often replicated in the media that seek to compare the “State budget” to the “family budget”.

The neoclassical perception is linked to the dominant notion of the State as a neutral “entity”, which defines each State attitude as a separate action and also having an isolated impact on the economy. It should be noted that this conception has repercussions on the idea of ​​“independence” of the Central Bank, and on aspects of fiscal rigidity. It is interesting to note that in all moments of structural crisis (1930, 1973, 2008) and war conflicts, deficits Budgets are freely determined by the presidential executive with full consent from the Federal Reserve Board, in the case of the USA, for example.[iv]

The 20th century demonstrated that the permanent outbreaks of crises in the capitalist system force an increasing presence of the State in the management of certain sectors of the economy, removing obstacles to capital accumulation. Likewise, the dominant discourse around only momentary crises and market solution adjustments has also historically shown itself to have no basis in reality, but composing the logic of the explanatory models of conventional economics.

SEP and its radical critical role

The Brazilian Society of Political Economy (SEP) was created in 1996 as a result of the XNUMXst National Meeting of Classical and Political Economy,[v] centered on the demarcation of divergent theoretical points in relation to neoclassical hegemonic thought on the development and regulation of the capitalist economy and, mainly, on the treatment of Brazilian society, it established an organizational center of critical economic thought of enormous relevance not only in Brazil, but for all of Latin America.

In the founding meeting of the Brazilian Society of Political Economy we had the participation of more than 90 political economists, with a great diversity of positions, with the main currents of critical economic thought being present in the construction of the entity. Over the last 28 years, the number of works presented has increased, and in 2023, 145 scientific works were presented at the SEP held in the state of Alagoas.

The various heterodox currents represented in the entity (Marxists; neo-Ricardians; post-Keynesians; neo-Shumpterians and structuralists) have a necessary space for development and creative organization for the collective construction of alternatives to neoclassical positivism. The points of convergence of these different visions can be summarized in four points of proximity, even though many others are those of contradictions, differentiations and divergences:

(i) There is an important convergence regarding the criticism of the false “neoclassical consensus”, considering both the need for a more historical approach to the “concrete thought”, that is, the social, economic and environmental reality; (ii) Political economy does not establish itself as a neutral science that naturalizes its object of study. It constitutes a social science and distances itself from the positivist ties that characterize ordinary economics.

(iii) Criticism of the dogma of fiscal rigidity and the logic of budget balance. This analysis is distorted because it does not consider the components of the credit system and the dynamics of capital accumulation. The general corollary of this interpretation is the condition that all savings (S) generated in the system find, in some way, productive application (I) and that it is the subjective decisions to save that determine investment. This perception generates the predominant version of public finances based on budget balance, establishing the impossibility of maintaining government deficits.

(iv) Finally, the set of perceptions gathered in the Brazilian Society of Political Economy consider the critical limits of capitalism, considering the need for necessary ruptures with the current standard. The existing consensus is not moving towards a single perception, different views are observed regarding the paths to be followed, however the radical criticism of neoliberalism and the current condition of complete commodification of nature and extreme social inequality are points of convergence.

Political economy would have the scientific function, according to Marx, to investigate “the internal structure of bourgeois relations of production, as opposed to the vulgar economy, which moves only within the apparent context”. What SEP and the researchers and scientists organized around it do refers to the exercise of structural analysis of capitalism, seeking both to establish the limits of this productive order and to project civilizing solutions. Long live the Brazilian Society of Political Economy!

*Jose Raimundo Trinidad He is a professor at the Institute of Applied Social Sciences at UFPA. Author, among other books, of Agenda of debates and theoretical challenges: the trajectory of dependency and the limits of Brazilian peripheral capitalism and its regional constraints (Paka-Tatu).


BERLE, Adolf A. The American Economic Republic. Rio de Janeiro: Forense, 1982.[https://amzn.to/4c2PDUA]

BLYTH, Mark. Austerity: the story of a dangerous idea. São Paulo: Autonomia Literária, 2017. [https://amzn.to/456cTyR]

HUNT, E.K. History of economic thinking. São Paulo: Elsevier, 2012. [https://amzn.to/3RdSJNk]

KUHN, T. The structure of the scientific revolution. São Paulo: Perspectiva, 1989. [https://amzn.to/3RcPG89]

MARX, K. Capital: critique of political economy, Book I: The process of production of capital [1867]. São Paulo: Boitempo, 2013. [https://amzn.to/3Vt8vXt]

MATTEI, Clara E. The Order of Capital: how economists invented austerity and paved the way for fascism. São Paulo: Boitempo, 2023. [https://amzn.to/3V5MsER]

SCHUMPETER, JA History of economic analysis. Mexico: Cultural Fund, 1964.

STUDENSKI, P. & KROOSS, HE Financial history of the United States. New York: McGraw-Hill, 1963. [https://amzn.to/45haSjq]

VAROUFAKIS, Yanis. The Global Minotaur: The True Origin of the Financial Crisis and the Future of the Economy. São Paulo: Autonomia Literária, 2017. [https://amzn.to/4c9LbUd]


[I] The SEP National Meeting takes place annually and this year, 2024, for the first time, it will be held in the Amazon region, specifically at the Federal University of South and Southeast of Pará (UNIFESPA), with a wide program that can be accessed at: https://www.sep.org.br/01_sites/01/index.php. The SEP Meeting will be between the 11th and 14th of June in Marabá in the state of Pará.

[ii] HUNT, EK History of Economic Thought. São Paulo: Elsevier, 2012.

[iii] In the first chapter of Capital (“The commodity”), see: Marx (2013, [1867], p. 156, note 32).

[iv] See, among others: Studenski & Krooss, 1963; Berle, 1982; Varoufakis, 2017; Blyth, 2017; Mattei, 2023).

[v] For the SEP history, check: https://www.sep.org.br/01_sites/01/index.php/instituicao/historico-sep.

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