[Marxism] Thoughts on 8 Theses

[D OC]

A chairde,

 

I have been reading much of this discussion. 

 

It seems to me that neo-classical conceptions have crept into marxist analysis. Specifically, while the eight theses are a very useful explanation of the apparent unfolding of the recent economic crisis, it is an analysis which appears to lack materialist depth.

 

What does financial investment constitute in real economic terms? Of course some element represents nothing more than the fiction of price over value but it is more than simply that.

 

Financial investment is integral to globalised production in the imperialist mode. As such, the dominance of 'financial' capital over productive capital is reflective of the dominance of imperialist over domestic production. 

 

The crisis would appear to be at least highly conditioned by (and I would tend to believe caused by) the imbalance of trade that lies underneath the trends which have been analysed by the (unduly insular) eight theses. These underlying trends are conditioned by the global imbalance in the metabolism of production. Just as agriculture is imbalanced between countryside and town, so too now production and consumption on a global scale. The eight theses make a critical point in terms of how financial instruments have been developed to enable globalisation of investment but fails to develop this argument from that point - it seems to me at least. 

 

Credit has allowed that situation to extend beyond the ordinary limits of balance. The gains of social reformism (which were always underpinned by imperialist super-profits) were largely rolled back but the relative position of privilege in imperialist centres remained and even extended relative to the peoples of the third world. The imbalance of consumption over production is reflected in some way in the aggregate price differential known as the 'trade deficit'; however, I would argue that this is a significant underestimation of the imbalance of trade due to prices not reflecting value. In marxist terms, much of the GDP per capita in imperialist centres has no intrinsic value whereas the value of production in the third world is very close to the price of its export. The bulk of value generated by most imperialist economies is surplus value obtained from foreign production/exploitation. The price of this surplus value is extenuated by mark up between the productive and consumptive markets. The dependence of the British economy on financial services and the parallel deindustrialisation and unprecedented contraction in agricultural production in the same country is a case-in-point. Britain's society is built on the profits of super-exploitation just as is Iceland's and to a lesser extent that of the USA. Consumption on that basis could only be facilitated by the extension of (inflated) credit and a graduated build up of national debt to 'net producer' economies. 

 

Credit overextended to its very limits has now has collapsed - aka the financial deleveraging - and this will not be simply reversed in the short to medium term. Such leveraging was only sustainable with an inflation in global prices and profits underpinned by a growth in the net real global capital base. As a result, there are two crises - a crisis of the financial institutions which have facilitated the overextension of credit - and a crisis of consumption in the imperialist core. This will naturally spread outwards to a crisis of the productive centres - which is what we're seeing in drops in economic output across the world.

 

It would appear that the only way to steady the boat on the long-term is to rebalance the productive economy. There are two relatively obvious ways to do that - first is to lower consumption in the imperialist centres (a lowering of the standard of living) - which is already happening - and second to address the imbalance of trade. Hence the talk of keynesian stimulus and the possibility of protectionism. The alternative for the west is to control a critical raw material for production i.e. oil or something similar, but I don't see that as viable at this time.

 

Necessarily, this is a generalised presentation but it stands in fairly stark contrast to the analysis of the eight thesis which I fear seeks to explain the crisis in terms which are *fundamentally* national and loses the connection which marxist economics need to retain to materialist analysis. 

 

Thoughts, anyone?

 

Le meas,

DoC.

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