On Economic Crisis

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:27 pm

blindpig
11-09-2009, 02:01 PM
I just left that thread.

Just trying to match the concrete. So Waterloo roughly corresponds with the beginning of the Industrial Revolution. Crimea, 1848, the rise of Prussia and unified Germany are results, the last event marking the beginning of the new cycle. I'm seeing that these things develop unevenly, in the US it was the Civil War, which certainly destroyed a whole class of capital, followed by the Trusts(the 'parvenus'). Expansion of markets by the new round of colonialism worked for a while and then it didn't and any excuse would do.....

So it seems that every 70 years ( an arbitrary, contingent number) they run out of tricks and necessarily behave like cornered rats, with the rest of the world to pay...

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:27 pm

Kid of the Black Hole
11-10-2009, 10:09 AM
Expanding markets are subject to the same logic and contradictions as any other capital

Look at China -- something like 500+ million peasants? And yet it isn't just as simple as adding them to the "domestic market". Whatever gets built gotta pull its own weight when it comes to adding to (expanding) value.

And, as it turns out, its a tough trick to turn without also stoking up class struggle in the process.

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:27 pm

Dhalgren
11-10-2009, 10:16 AM
occurs - it is the snake eating its tail...I think...Class conflict can arise wherever and whenever exploitation occurs, this is what motivated the "Cultural Revolution"...

chlamor
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Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:28 pm

Kid of the Black Hole
11-10-2009, 10:35 AM
the Great Leap Forward and GPCR. Without any first-hand perspective I find it hard to assess, but it seems a little screwy to me from casual reading and study. I get that there are always extenuating circumstances too

But I don't know

chlamor
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Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:28 pm

anaxarchos
04-09-2010, 10:52 AM
Since this thread was written, a very succinct analysis of the current crisis has been published which agrees with this thread in virtually every detail, both theoretical and practical. More... it is from the most unlikely source conceivable.

I'll try to post it and go through it in detail in the next couple of days.

The bastards have no real theory, you know... they borrow ours when they run out of lies.

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:28 pm

Kid of the Black Hole
04-13-2010, 10:40 AM
I have a suspiscion on this, but will be very interested to see what it is

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:29 pm

anaxarchos
04-13-2010, 10:58 AM
I'm just waiting a day or two for the board drama to die down. The material is important.

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:29 pm

PinkoCommie
04-13-2010, 06:10 PM
and I do have my Pisarev and scanner... However, I am only now reloading my drivers and OCR (and and and ad nauseum). I have to format my goddamn hard drive in order to get some software to load for a mandatory class - a "class" that I had to drive 15 hours one-way to attend and which did Nothing to explain my installation errors and little more to explain its operation which I was already comfortable with.

So, in between the significantly rising rate of exploitation that has attended my recent Real Work in the field (*this owing to the relative blessing of having too much to do all at one time even as the summer looks bleak indeed), I have had a woeful delay in being able to do much of anything online as I try to rebuild a corrupt work-mail file and reload the scads of apps I run on this laptop when not being fucked over by one in particular or working 12 hour days on construction sites and military bases.

It's almost a living though!

And the "efficiency" of capitalist development, well, it is a sight to behold. It'll be good to get back on a military jawb for while, the fuckin' socialists :)

OET - heh. I really didn't miss anything after all. Same old shit. Show us somethin' older and all new.

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:30 pm

anaxarchos
04-20-2010, 07:47 PM
...and we will return to "business" (the economic crisis).

BTW, there is a real need to look at California in particular through this recession. We should try to get to that sometime in the not too distant future.

chlamor
Posts: 520
Joined: Tue Jul 18, 2017 12:46 am

Re: On Economic Crisis

Post by chlamor » Thu Jan 02, 2020 2:30 pm

anaxarchos
04-20-2010, 10:19 PM
This is by Patrick Bond who is a professor at the University of KwaZulu-Natal in South Africa. The account has some weaknesses but it appears prescient as far as the onset of the current "Great Recession" (this was written in 2003 - the emphasis is mine):

http://www.marxmail.org/faq/overproduction.htm


What is a crisis of overproduction?

Prepared by Patrick Bond

Capital accumulation refers to the generation of wealth in the form of "capital." It is capital because it is employed by capitalists not to produce with specific social uses in mind, but instead to produce commodities for the purpose of exchange, for profit, and hence for the self-expansion of capital. Such an emphasis by individual capitalists on continually expanding the "exchange-value" of output, with secondary concern for the social and physical limits of expansion (size of the market, environmental, political and labour problems, etc.), gives rise to enormous contradictions. These are built into the very laws of motion of the system. Perhaps the most serious of capitalist self- contradictions, most thoroughly embedded within the capital accumulation process, is the general tendency towards an increased capital-labour ratio in production--more machines in relation to workers--which is fuelled by the combination of technological change and intercapitalist competition, and made possible by the concentration and centralisation of capital.

Individual capitalists cannot afford to fall behind the industry norm, technologically, without risking their price or quality competitiveness such that their products are not sold. This situation creates a continual drive in capitalist firms towards the introduction of state-of-the-art production processes, especially labour-saving machinery. With intensified automation, the rate of profit tends to fall, and the reasons for this are worth reviewing. Profit correlates to "surplus value" which is only actually generated through the exploitation of labour in production. Why is labour only paid a certain proportion of the value produced, with a surplus going to capital? Since capitalists cannot "cheat in exchange"--buy other inputs, especially machines that make other machines, from each other at a cost less than their value--the increases in value that are the prerequisite for production and exchange of commodities must emanate from workers.

This simply means, in class terms, that capitalists do not and cannot systematically exploit other capitalists but they can systematically exploit workers. Here arises the central contradiction: with automation, the labour input becomes an ever-smaller component of the total inputs into production. And as the labour content diminishes, so too do the opportunities for exploitation, for surplus value extraction and for profits. Given intensifying intercapitalist competition for profits--the basis of the Brenner thesis about the ongoing overaccumulation/falling-profits crisis--this situation exacerbates what becomes a self- perpetuating vicious spiral. Workers (as a whole) are increasingly unable to buy the results of their increased production. In turn this results in a still greater need for individual capitalists to cut costs. A given firm's excess profits are but only temporarily achieved through the productivity gains which automation typically provides, since every capitalist in a particular industry or branch of production is compelled to adopt state-of-the- art technologies just to maintain competitiveness.

This leads to growth in productive capacity far beyond an expansion in what consumer markets can bear. (It is true that there are countervailing tendencies to this process, such as an increase in the turnover time of capital, automation, and work speed- up, as well as expansion of the credit system. But these rarely overwhelm the underlying dynamic for long, and there are limits to the height of the consumer debt pyramid.) The inexorable consequence, a continuously worsening problem under capitalism, is termed the overaccumulation of capital. Overaccumulation refers, simply, to a situation in which excessive investment has occurred and hence goods cannot be brought to market profitably, leaving capital to pile up in sectoral bottlenecks or speculative outlets without being put back into new productive investment. Other symptoms include unused plant and equipment; huge gluts of unsold commodities; an unusually large number of unemployed workers; and the inordinate rise of financial markets.

When an economy reaches a decisive stage of overaccumulation, then it becomes difficult to bring together all these resources in a profitable way to meet social needs. How does the system respond? There are many ways to move an overaccumulation crisis around through time and space. But the only real "solution" to overaccumulation--the only response to the crisis capable of reestablishing the conditions for a new round of accumulation--is widespread devaluation. Devaluation entails the scrapping of the economic deadwood, which takes forms as diverse as depressions, banking crashes, inflation, plant shutdowns, and, as Schumpeter called it, the sometimes "creative destruction" of physical and human capital (though sometimes the uncreative solution of war). The process of devaluation happens continuously, as outmoded machines and superfluous workers are made redundant, as waste (including state expenditure on armaments) becomes an acceptable form of mopping up overaccumulation, and as inflation eats away at buying power. This continual, incremental devaluation does not, however, mean capitalism has learned to equilibrate, thus avoiding more serious, system-threatening crises.

Devaluation of a fully cathartic nature (of which the last Great Depression and World War are spectacular examples) is periodically required to destroy sufficient economic deadwood to permit a new process of accumulation to begin. When overaccumulation becomes widespread, extreme forms of devaluation are invariably resisted (or deflected) by whatever local, regional, national or international alliances exist or are formed in specific areas under pressure. Hence overaccumulation has very important geographical and geopolitical implications in the uneven development of capitalism, as attempts are made to transfer the costs and burden of devaluation to different regions and nations or to push overaccumulated capital into the buildings (especially commercial real estate), infrastructure and other features of the "built environment" as a last-ditch speculative venture. Moreover, the implications of overaccumulation for balance in different sectors of the economy--between branches of production (mining, agriculture, manufacturing, finance, etc.), between consumers and producers, and between capital goods (the means of production) and consumer goods (whether luxuries or necessities)--can become ominous. Indeed, because the rhythm of overaccumulation varies across the economy, severe imbalances between the different sectors and "departments" of production (sometimes termed "disproportionalities" or "disarticulations") emerge and introduce threatening bottlenecks in the production and realisation of value, which further exacerbate the crisis. These processes enhance the control and speculative functions of finance.

The argument, simply, is that as overaccumulation begins to set in, as structural bottlenecks emerge, and as profit rates fall in the productive sectors of an economy, capitalists begin to shift their investable funds out of reinvestment in plant, equipment and labour power, and instead seek refuge in financial assets. To fulfil their new role as not only store of value but as investment outlet for overaccumulated capital, those financial assets must be increasingly capable of generating their own self-expansion, and also be protected (at least temporarily) against devaluation in the form of both financial crashes and inflation. Such emerging needs mean that financiers, who are after all competing against other profit-seeking capitalists for resources, induce a shift in the function of finance away from merely accommodating the circulation of capital through production, and increasingly towards both speculative and control functions. The speculative function attracts further flows of productive capital, and the control function expands to ensure the protection and the reproduction of financial markets. Where inflation may be a threat, the control functions of finance often result in high real interest rates and a reduction in the value of labour- power (and hence lower effective demand). Where bankruptcies threaten to spread as a result of overenthusiastic speculation, the control functions attempt to shift those costs elsewhere. In sum, what we have sketched out above is a story of how crises are generated through the logical internal functioning of modern market economies, whether in national or global settings. A good amount of the world's systematic unevenness and inequality--not to mention its various geopolitical tensions-- follows directly from the ebb and flow of capital, both geographically and from productive to financial circuits.

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