Hilferding, Rudolf

(1877–1941)

   Born in Vienna, Hilferding trained and worked as a doctor before becoming involved full-time in politics, with a particular interest and expertise in political economy. He wrote frequently on economics for the Neue Zeit, edited by Karl Kautsky, taught in the German Social Democratic Party (SPD) school, and at different times edited the SPD newspaper Vorwärts, the Independent Social Democratic Party (USPD) paper Freiheit, and the socialist journal Gesellschaft. He was briefly minister of finance in 1923 in the Gustav Streseman coalition government and again in 1929 under Chancellor Herman Müller, and was a member of the Reichstag from 1924–1933. With the Nazi takeover Hilferding fled to Switzerland, then Austria and then France, but was captured and committed suicide while being held by the Gestapo. Hilferding’s major contribution to Marxism lies in his two works Bohm-Bawek’s Marx-Critique (1904) and Finance Capital (1910). In the former he replied to Bohm-Bawek’s criticism of Marx’s economic theory and in the latter he analyzed what he called “the latest phase of capitalist development.” There were several key points in his defense of Marxist economic theory and his account of contemporary capitalism. First, finance capital (the banks) was becoming much more closely involved with industrial capital and playing a dominant role. Secondly, capital was becoming increasingly concentrated and centralized in ever more powerful corporations. Thirdly, there now existed what Hilferding called “organized capitalism” by which he meant that there was much more planning and regulation of the economy and of relations between states to create a stable capitalism. Finally, he concluded from his analysis that the workers must wrest control of the planning and organization of the large corporations by winning political power through democratic elections.