[Marxism] Thoughts on 8 Theses

[D OC]

S, a chara,

 

Many thanks for your response. 

 

> Sure. Mostly I disagree.

 

Good. I look forward to the discussion and learning something more.


> Agree that neo-classical conceptions have crept in-- and most neo-classical 
of all, and most of the creeping is in this notion of trade imbalances-- 
trade imbalances neither reflect nor cause breakdowns in capitalism as 
capital-- as the reproduction of expanded value.


I'm not sure that I mean the same thing as the neo-classical concerns around imbalance but we'll see.


> As a matter of fact this dependence, reliance, on trade imbalance theory is 
a little more than neo-classical. It is positively mercantilist. Engels 
wrote an interesting piece in 1843 in the Jahrbucher on the critique of 
political economy; includes a great attack on mercantilist "balance of 
trade" worhippers.


I will check this out. Someone was recently quoting me sections on this elsewhere. I will come back to you on it. Thanks.


> The proof, more or less, of the inapplicability of "balance of trade" 
theorizing, you provide when you make the analogy between agriculture and 
city-- absolutely-- cities "import" much more from the countryside than 
they "export" to the countryside-- that's an index to the relative 
development of the city over the countryside-- this doesn't make the city 
financially or economically subservient to the countryside-- to the 
production of exchange value in agriculture. There is no NEED in capitalism 
for balance; for balance between industry and agriculture-- balance is 
necessary in barter, but not in capitalist exchange. Profit is what counts. 
Expanded value. Not balance.


True. But the balance I speak of is different to that you speak of. There are very many types of balance so it is critical we speak of the same thing. In the case of city-countryside exchange, in a stable capitalist scheme, cities export commodities produced in factories in return for the raw materials produced in fields and mines (for an example). There is balance to the trade in value terms. The cities cannot hope to extract greater value from the rural areas indefinitely and although the trade is imbalanced in relative productivity terms, it is balanced in terms of value exchanged.

 

This is precisely not the case in the current international metabolism of trade. By definition, net surplus value is taken (exploited) from capital-dependent countries by those with its surplus. There is an imbalance in value exchanged from third world to first world (imperialist) economies. It is this imbalance that I speak of; not the imbalance of trade spoken of by the vulgar economists - an imbalance defined by 'price' in any case.


> Financial investment has always been intrinsic to capitalist development, 
just as international, global expansion has always been intrinsic to 
domestic capital investment. 

 

I don't deny this. What I believe, however, is that this has undergone a 'qualitative' change - about a hundred years ago. Indeed, that is the social basis of 'imperialism' by Lenin. My contention is that the crisis is rooted in the structural changes which have occurred in the social relations of production which remain characteristic of imperialism in the era of 'globalisation'. You may choose to see the root as a falling rate of profit - which I don't deny is a trend - but to bypass that tendency - the imperialists have concentrated production in the third world and accrued both surplus value and super-exploited surplus value as a result. To avoid the polarity of the contradiction in domestic production, they have abstracted to a new and more severe contradiction on a global scale.

 

The problem is that that this has allowed the inflation of the financial superstructure and the growth of predatory finance-capital but has left behind the working class in the imperialist core. To some extent, this tendency has been mitigated by social reformist concessions (facilitated by transfer of super-exploited surplus value to the 'privileged' sections of the 'domestic' working class) but also through the extension of credit (itself facilitated by a 'price' inflation on unproductive assets e.g. houses). Of course, all of this occurs in a period of high productivity which has enabled more (in use value terms) to be done with less (in exchange value terms) - but essentially the net transfers in value terms has remained qualititatively the same.

 

Of course, the availability of credit and the increasing productivity of labour have enabled wages to be depressed further in imperialist centres (and this also challenges social 'transfers'). So progressively the latter factor  (credit) has became more dominant in enabling consumption to increase.

 

> The bulk of the value generated, appropriated 
by the advanced capitalist countries is most certainly NOT value 
expropriated, seized, looted, unequally exchanged from "foreign 
exploitation" if you mean by foreign exploitation-- super-profits derived 
from poorer, less-developed countries. The overwhelming bulk of 
imperialist investment is inter-imperialist, or maybe better 
INTRA-imperialist, the overwhelming source of profits is, again, inter/intra 
imperialist, and is not derived from investments in the less-developed 
countries.

 

On what do you base this? No doubt on basis of 'prices'. The reality is that little is produced in imperialist countries but instead they generate a lot of 'value added' through simply repackaging things. Take the blossoming industry of 'supply-chain management'. It is a classic example. Cloth is produced in one country, stitched into garments in another and exported to a third where the customer pays a handsome mark up. The bulk of the profit accrues to the SCM company located in a fourth country. So let's look at price-based 'value added' as the european capitalists call it. The cloth sells for pennys. The garment for perhaps twice or five times that. The consumer pays a massively inflated price many multiples higher. The net profit in price terms accruing to the SCM company is huge relative to the cost of production. The GDP figures you quote will give significant 'value-added' contributions from the service sector, which by definition produces minimal value in marxist terms. Just think about that for a second.

 

This happens repeatedly across the global economy in the real world; all over the place. The net impact is that GDPs in the imperialist countries grow at rates considerably above the parallel rate of growth in 'trade deficits' (measured in price terms). From a capitalist perspective, it is sustainable because of the difference is sufficient to enable it the imperialists to continue to borrow to pay off that accumulated trade deficit. The crucial gap in the model is, however, the imperialist end 'consumer'. They are 'paying' for the huge mark-up in price. That is financed from our two sources of 'transfer' identified above and possibly income from a 'service sector' job. The problem is that if the capitalist class is to make sufficient profits as a percentage of investment from this exercise, the only way for this to happen is for consumption to be financed by an expansion in credit.

 

In a sense, I therefore agree that the problem is related to the tendency of profit to fall but it is also rooted in the international division of labour. To fail to see the importance of the multi-trillion dollar debt held by the Chinese over the USA is to miss the essence of the contradiction. This is my criticism of the eight theses. 

> Regarding productive cores and advance countries-- US still provides the 
largest portion of the world's industrial production-- about 24-21% [think 
this is a 2007 figure] and even poor old decadent super-annuated Britain has 
a manufacturing sector providing about 15% of GDP-- not very much less than 
France's ratio.

 

Again, just how much of this 'production' is simply repackaged production from the third world. What proportion of your figures for UK GDP is made up from 'service sector' production. What does this represent in real value terms? How many components are produced elsewhere,  bought cheap, assembled and then parceled on at a huge price 'markup'? To simply accept 'price' based estimates of GDPs as reflecting underlying 'value' from various sectors is surface only analysis at its worst.

 

Even if in the real world, manufacturing and agricultural production provided 90% of GDP - what does that tell you? It says that 10% of the net GDP is directly accumulated from exploitation overseas and that's on the basis of GDP figures alone and a massively inflated figure of 90% as opposed to your 15% - a very poor indicator of what's really happening (which can only be determined by a analysis of gross national consumption as against gross national production). This is the centre of the crisis in my opinion. That differential was sustainable in periods of expanding credit, and expanding growth, but unsustainable in periods of contraction in both growth and credit.

 

Anyhow, thanks for your response. I have to get back to work but hope others who know more join in this discussion.

 

le meas,

DoC.


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