Re: [OPE-L] SV: [OPE-L] what is irrational in the functioning of capitalism?

From: clyder@GN.APC.ORG
Date: Fri Dec 01 2006 - 15:00:49 EST

Quoting ajit sinha <sinha_a99@YAHOO.COM>:

> Imagine a large capitalist economy which produces a
> huge amount of surplus however employs just a few
> thousand workers (since you guys are not ready to
> accept zero worker situation). Now, if you apply
> Marx's calculation here, then the labor-values of
> commodities would be close to zero and if wages are
> what is necessary to reproduce the labor-power, then
> the rate of profits would be quite high, and this high
> rate of profits (within Marx's calculations) could
> only be explained by a very high rate of surplus
> value.

This is not evident to me. In what sense is the
capitalist economy 'large' if it employs only a
few thousand workers?

Is it large in the Tonnage of output?

It is clearly not large in the normal sense of the
word - employing lots of people.

It would not make sense to say that it was large in
money terms since the the value of money is arbitrary
and can be changed by a currency revaluation like that
of De Gaulle.

You are assuming I think that wages are low relative to
the total product - which does imply a high rate of exploitation,
I dont see that there is anything paradoxical here - counter factual
but not paradoxical. Counter factual because we know that the
range of variation of rates of surplus value is actually quite
small say 60% to 200% in current capitalist economies. This
also appears to be stable over long historical periods.

> This makes no sense to me. Capitalists are in business
> to make profits (M-M'), if a capitalist finds that
> s/he can increase her/his profit by introducing a
> technique that displaces labor, then why wouln't s/he
> do it? As a matter of fact Marx's argument is that
> actually the dynamics of capitalism is such that this
> will keep happening--that's why my limiting case of
> this dynamics is something Marxists cannot close their
> eyes to.

I think you have to consider the dynamics of the process
more carefully. If the rate of surplus value rises unusually
high, then labour is cheap and it will pay capitalists to
use labour intensive rather than capital intensive techniques.
Thus the process you hypothesise will be self limiting.

We know empirically that capital intensive industries do
experience lower rates of profit, so in general capitalists
will prefer to invest in labour intensive industries.

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