Re: [OPE-L] the global labor force and capital accumulation

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Tue Jan 17 2006 - 16:34:53 EST

>  > Again I ask the question of what it
>  > means to say the supply of capital is fixed and how that is
>  > to be explained.
>  > I am posing clear questions about Freeman's article.
>  > I understand that you may not find my question interesting. That
>  > is alright. But let's not pretend that you are speaking in any kind
>  > of conversation with me.

>Let us not pretend that you initiated the thread or that your questions
>were the first.  To refresh your memory, you can re-read the original
>questions which I posed ... and you have not addressed:

Right but I did not copy your questions and then pretend to answer them.
I was not giving the pretense of answering the good questions that you raised
about this piece.

>As for your questions about Freeman's article, I _did_ address them
>in the best way that I knew how  -- by _not_  succumbing to uninformed

At one level it does not matter what Freeman himself thinks. Is the
supply of capital virtually fixed? If so, why? Is the reason
for the undersupply of capital the same as in Malthus' time?

One need not answer those questions.  I was just pointing to an
unexamined  and unjustified assumption in his analysis. Moreover, I was
pointing to his unjustified faith that the supply of capital
would eventually be forthcoming to restore what he saw
as healthy capital/labor ratios. There is no reason this set
of questions is more interesting than yours. I was simply
adding to them, so I did not pretend as if I was critiquing or
picking at you.
I was not.
Nor were you speaking to my questions, though you pretended to be.

>  See the  'PS' from the previous message (reproduced
>  > Now as for your previous "reply" to my questions
>  > about Freeman's analysis, I was quite surprised by
>  > this cavalier statement:
>  > There are other disanalogies and analogies: even if one
>  > accepts Grossman's argument,  one can not reasonably
>  > claim that the current transition "is a necessary and
>  > constitutive element of capitalism."  Yet one might claim that
>  > this "can and should only be a transitory tendency".
>  > Jerry, do you mean that the worsening situation of labor vis a vis
>  > capital and the absolute growth of the surplus population "' can and
>should only be a transitory tendency'"?
>No.  What I wrote was very simple, not in the least bit 'cavalier', and
>should not have been particularly controversial.

>I don't think anyone claims that the changes in the international
>division of labor following the transformations in the former USSR,
>many Eastern European nations, and the PRC  were necessary
>and constitutive elements of capitalism.

There are people who claim that the spatial extension of capital
is indeed a constitutive element of capitalism. As I recall there
have debates about the expansion of the world market, the export of capital,
the incorporation of non capitalist modes of production.
So I am not sure I would make as strong a statement as you do here.

>  Since capitalism had
>long been the dominant mode of production internationally before
>these changes, it would be absurd to argue that they are
>"constitutive" of capitalism.

What is the reference for the "they" in this statement.

>   As for my second sentence above,
>one might claim that the privatization of industry in formerly
>'socialist' nations and the increase then in the quantity of
>wage-workers in those nations producing commodities for sale on
>international markets 'can and should be only a transitory

But this is not what I was arguing about. Freeman suggested that over time
(perhaps thirty years) the capital/labor ratio would be restored, the
of labor vis a vis capital would be sopped up. He suggested that this relative
shortage of capital can and should only be a transitory tendency.
Indeed even a Marxist could
agree. After all, if capital is in part the appropriation of unpaid labor time,
why would it not incorporate and exploit the newly available labor force?
  This is what Grossman
was suggesting. While in Malthus time capital would increase to sop up
the oversupply of labor, late capitalism would have difficulty doing so
as the shortage of surplus value relative to capital invested would show up
as a shortage of accumulated capital vis a vis the growing workforce.
There is thus reason to suspect that the oversupply of labor vis a vis
capital will  prove only a transitory tendency. This is a fundamental question
about the basic economic nature of our time.
I thought I was pretty clear that this was the question I was putting forth.
For you to come back and say that we are only dealing with transitory
problems is
indeed cavalier. And totally misses the point of my post.

>  There are, after all,  hardly any more 'socialist'
>nations left in the world so the extent to which this trend can be
>further generalized and internationalized is rather limited.
>As for your questions about Freeman's article, I can not answer
>what he means when he claimed that the supply of capital has been
>relatively  stable.   But I _did_ attempt to address the issue of
>_how_ that question can be answered in the following:

I am in touch with Freeman.


>  >>>>>>>>>>>>>>
>PS: I'm not sure how Freeman came up with his estimates for
>the  how "the effective supply of capital ... has virtually
>remained unchanged".  While his estimates for a change in the
>capital-labor ratio have been widely cited on the Net, I
>haven't been able to discover the original source for the
>estimates.  You could see his NBER page -- <>
>-- where many of his papers and his CV are online to
>track down the original source.  Or, you could (following
>the example of Paul B) ask him: <>
>  >>>>>>>>>>>>
>If you seriously want to know more about Freeman's position,
>then the makes some suggestions about what you can do.
>In solidarity, Jerry

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