No subject

of the exchange of capital and wage-labor, its reappearance as profit."

If this reproduction sentence means anything, it is simply a high-falootin'
way of repeating the old cliché that GM isn't primarily into producing cars,
they're into producing profits. Like every other capitalist. And the same is
true of Coca Cola. But much as it might want to, Coke can't make any money
producing cars and GM can't make any money putting sugar into water (and
sometimes not even that in Coke's case) because Coke doesn't have any car
plants and GM doesn't have any bottling plants. And neither can make any
money producing grumph, as neither has grumph plants (I'll come back to the
crisis of profitability in the grumph sector in a moment).

By going stratospheric into the realms of completely ABSTRACT capital and
ABSTRACT labor, Sartesian leaves behind all specific, concrete sources of
raw materials, production facilities, distribution networks and end
products. They're all way below us on the ground. But for that very reason,
his "contention that price inflation has to be analyzed according to how it
functions in the appearance and apportionment of profit" is absurd if one is
talking about prices for specific commodities. At the level of abstraction
we have risen to, there are NO concrete products, just the abstract
"commodity" produced by abstract labor hired by abstract capital, and which
therefore CANNOT HAVE a concrete, down to earth, quantifiable price.
_______________________

C. Methinks the gentleman protesteth too much, and is trying to accuse me of 
the very crime he has committed.  I believe I concretely pointed to the lack 
of "unexceptionalism" in the growth of the "demand" for oil in this century. 
I believe I concretely pointed to a matching, if not over-matching, growth 
in production.  I believe I concretely pointed to the rates of return for 
the oil industry; I concretely pointed to the lack of increase in lifting 
costs; I pointed to the failure of the peak oil "offset" theory between 
declining reserves and declining production.  And I concretely pointed to 
the oil companies reduction in capital spending over the years, hoarding and 
distributing cash. I believed I concretely pointed to the fact that the 
petroleum majors hold leases for exploration onshore and offshore, an no 
exploration has been undertaken on 80% of the territory covered by those 
leases.

You concretely pointed to..... what?  Peak theory? Notions of supply and 
demand?
__________________________

In other words, Sartesian, you've taken things to such a level of
abstraction that you forget the obvious. The REASON for the problems with
the reproduction of capital in the grumph sector is that GRUMPH DOESN'T
EXIST.

And neither, it appears, does the capacity RIGHT NOW to pump more oil of the
specific types and characteristics that can be most easily accommodated by
the really-existing crude oil market, which is an industry that, for
example, has a lot of refineries that can't handle the higher-sulfur "sour"
crude Saudi Arabia says it is willing to pump more of.

To handle it, those refineries would need an extensive retrofit that would
take years and cost millions of dollars.
__________________________

D. How about some facts to back up some of your GRUMPH?  How about some 
facts on refinery runs, refinery profit margins, grades of crude contracted 
for specific refinery runs.  How aboust something concrete?
___________________________________________________

My "contention" is that since the oil capitalists were happy as pie to sell
as much in petroleum products as anyone wanted at $30/barrel price levels,
they're even MORE overjoyed, positively orgasmic, to sell the same stuff for
four times as much four years later. And the fact that the oil giants are
currently enjoying the highest profits ever for any corporations in the
entire history of the human race suggests that at the level of the oil
industry, there's no extreme shortage of profits, no lack of the
reproduction of capital.
____________________________

 E. You really need to look at rates of return in the industry from at 
least1968 on. The issue of reproduction isn't only an issue of the 
reproduction of a MASS of profits; it is an issue of reproduction of that 
mass at a sufficient RATE..  So we really need to look at historical 
spending patterns, investment rates, return on investment rates, costs of 
production, and market prices before we make an assumption (to assume, as a 
past drill sergeant liked to say to me, between push-ups, to make an ASS out 
of U and ME) about the willingness, joy, and of the oil capitalists to 
expand production and, as history has shown them, drive the rate of return 
into the MID and LOW single digits.
____________________________

Consider the apple tree. ONE apple tree. Some fruit is lower on the tree,
some is higher. Is it really reasonable to assert that there will be an
infinite supply of low-hanging fruit?
_________________________________

F.  I love the homey touch.  It makes everything so clear.  I mean, let me 
get out my pen-knife and start whittling away as I sit here next to the 
cracker barrel (is the barrel half-full or half-empty).  I apologize for 
that bitter of sarcasm, but I think it's pretty well within the range you 
are using.

Anyway.  Well, we know we have one apple tree.  And we have historical 
records of millions and millions of apple trees.  And we know how much it 
can produce. AND BECAUSE IT CANNOT PRODUCE ENOUGH COMMODITY, USE-VALUE 
WRAPPED WITHIN EXCHANGE VALUE IN ITS "NATURAL STATE, REPRODUCE PROFIT 
QUICKLY ENOUGH--     we do what?  We farm.  We employ means of production 
and wage-labor to increase the production of apples, to improve the quantity 
of apples (and quality of apples) and the means of circulation to get them 
to market, and all of this will make the cost of an apple fall.  And when 
that  very act of "development" compels the rate of  profit to fall?  Have 
the apple trees failed to produce enough apples.  Are all the low hanging 
apples all gone?

When the harvest remains unpicked, and the fruit is left to rot, and the 
trees are no longer tended, has the world run out of apples.

But I know, oil is a fixed quantity, incapable of augmentation and 
reproduction.  Not so.  Known, proven reserves have increased over time, 
even since the time of the last oil giants.  Recovery rates have improved. 
And most importantly the fixed quantity of oil, in its entirety is not 
known.
________________________________________

Now it just so happens that Brazil has discovered what looks like could be
HUGE oil deposits but to get to them you need to go down through thousands
of feet of ocean and then drill thousands of feet below the ocean floor. How
expensive is that? Nobody is really sure, but a frequently cited guesstimate
is $100-$120/barrel. A lot of the technology to be used needs to be
developed  -- for example, how to keep an untethered oil platform over the
same spot of ocean floor, or alternatively, how to anchor a rig so far from
the ocean floor.
__________________________
G.  Let's be clear comrade.  Oil was discovered, that could be of huge 
quantities.  The problem is what-- supply and demand?  Or is it profit and 
the existing and possible cost of the means of production?
___________________________

Now, if someone could GUARANTEE the oil industry that some huge new more
easily accessible deposit won't be discovered tomorrow, probably investments
like that wouldn't be such a crap shoot from big oil's point of view. But no
one can guarantee that. Nor can they guarantee that there won't be some big
economic slowdown that will send demand and the price plummeting, or some
technology breakthrough or change in social behavior that will lead to the
same thing.
________________________
H. Again, abstraction, supposition, speculation, classically bourgeois 
economist risk assessment theory.

But what is interesting are the factors you put into the risk:  not those of 
the biosphere you allude to earlier with hurricanes, and storms, etc.  But 
the risks are a big economic slowdown that will send demand and the price 
plummeting, or some technology breakthrough or change in social behavior. 
I'm sorry, you stole that from me.  Give it back.

And I think I just said all I needed to say, since you said it too.