Re: [OPE] Britain--parasitic and decaying capitalism: A comment

From: <>
Date: Mon Dec 28 2009 - 11:04:49 EST

The article can be found on the website

Go to previous editions of FRFI Newspaper It is in FRFI 194.

A PDF version can be found at

David Yaffe

At 14:37 27/12/2009 -0500, you wrote:
>can you please indicate the source of David's article.
>Thank you,
>-----Original Message-----
>From: Dave Zachariah <>
>To: Outline on Political Economy mailing list <>
>Cc: Jacob Richter <>
>Sent: Sun, Dec 27, 2009 1:15 am
>Subject: [OPE] Britain--parasitic and decaying capitalism: A comment
>A comment on David Yaffe's article "Britain--Parasitic and decaying
>The general outline of the article is consistent with the orthodox theory
>of imperialism going back to Hobson and Lenin. But even after subtracting
>the typical complaints against other far-Left groups in Britain, I find
>parts of the article unconvincing and not well-argued.
>A key problem is that what actually constitutes 'imperialism' is not well
>defined, and in what sense its operation differs from the laws of motion
>of capitalism that operate within an established market. I would agree
>that the classical era of capitalist imperialism was characterized by the
>dominance of the rentier interest and its distinguishing feature is the
>'export of capital', i.e. global investment, as opposed to the export of
>commodities. But I do not think these features are sufficient, and to
>believe they are will lead into the traps of nationalism and misconceived
>notions of 'national oppression'.
>If capitalists in region A invest in region B, this in itself is not
>imperialism, but the operation of capitalism. Further, if the capitalists
>are transformed into rentiers that merely transfer interest payments and
>dividends from region B to A, then it is the operation of capitalism with
>finance capital. Both scenarios occur persistently across regions,
>especially between countries considered to be 'imperialist'.
>If 'imperialism' is to mean anything specific it has to relate to 'empire'
>and therefore to the system of territorial states which pre-dates
>capitalism. Classical imperialism in the capitalist era then was the
>convergence of the rentier interest and the interests of the territorial
>state to establish the above scenario in regions where either the market
>did not exist or where states opposed the capitalists from outside.
>Capitalist imperialism is therefore the set of extra-economic mechanisms
>of coercion used by states when the standard operation of rentiers through
>an established free market cannot operate in a region for various reasons.
>The extraction of interests and dividends by rentiers in Britain from
>various regions of the world is not equivalent to 'national oppression' as
>such. Any oppression that results from this economic relation is done by
>the rentier class, the state apparatus and the client states or
>organizations that they may involve and not the exploited classes in
>Britain. (The only sensible use of 'oppressor nation' is the case of
>settler-colonial states, when an entire community is founded in a region
>that exploits or excludes the indigenous population.)
>The article rightly points out the differential between rates of return on
>foreign assets flowing between the rich and poor regions. This is to be
>expected since capital exports from a region is driven by precisely the
>low rate of return that follows from a stagnant workforce and high levels
>of capital investment.
>This may very well lead to a parasitic extraction by agents in the rich
>countries but to conclude the nature of this it would be necessary to look
>at the income flows across all regions. A substantial---I would guess the
>bulk---of these streams flow between the advanced countries. It is however
>clear the advanced economies that have been running a persistent trade
>deficit the past years are parasitic since it means that they are
>appropriating a part of the surplus product produced elsewhere, from both
>developing and advanced countries.
>Moreover, it does not follow logically that a high rate of return in
>underdeveloped countries is a result of super-exploitation. Work by Paul
>C, Allin and myself has shown that rates of return on capital stocks are
>independent of the wage share, and are determined by the growth of labour,
>productivity and the level of investments. Still less does it entail that
>rate of exploitation would be lower if the local working classes were
>exploited by 'national' capital.
>Labour aristocracy
>It is certainly true the current levels of living standards in the
>advanced countries are dependent on income flows from abroad. But to
>conclude that there exists a 'labour aristocracy' that is somehow bribed
>by super-profits from 'oppressed nations' is a really weak theory in my
>view. The article does little to corroborate the theory by identifying the
>sections of the working-class more precisely; how they actually are
>benefited by super-profits; from which investments are these super-profits
>in 'oppressed nations' flowing; how this hypothetical economic relation
>leads to an ideological mechanism which supports the rentier interest?
>The only plausible candidate for the so-called 'labour aristocracy' that
>the article gives is within the financial sector, which I agree is
>unproductive and the center of the rentier interest. Employees in the
>financial sector have an interest in preserving their employment and
>therefore also the financial system.
>But I think the general argument behind the 'labour aristocracy' thesis is
>conflating the professional middle-class with the working-class. They do
>not share the same positions in the economic structure anyway. In my view
>this theory was primarily adopted by small far-Left groups who failed to
>give a proper account for the reformism within the working-class movement
>and hence their own political weaknesses. The consequence of such a theory
>is to destroy the confidence of the labour movement in the advanced countries.
>The real issue is the need for global trade-unions with coordinated
>activities across borders, and the primary obstacle is the
>wage-differential between regions of varying levels of development in an
>era of global capital flows. It makes capital flow to low-wage economies
>with labour reserves and migration flow towards the high-wage economies
>which weakens bargaining power there. This creates real problems for
>socialist politics in the advanced countries and is predicted to stabilize
>once the labour reserves begin to deplete. Then the bargaining power of
>labour can begin to rise on a global scale.
>//Dave Z
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Received on Mon Dec 28 11:23:08 2009

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