If it is what it is
Dann wird es, was es muss
1. When the bourgeoisie aren’t, and even when they are, flogging the virtues of responsibility, accountability, attention-to-detail, hands-on-management, they’re usually in court pleading out the latest bit of irregularities, high and petty crimes, misdemeanors, and assorted felonies, with claims of amnesia (“I have no recollection…”), or dementia (“I’ m not capable of recognizing my own handwriting”). Or, they’re busy blaming irresponsible, unaccountable, subordinate rogues for violating “corporate ethics” (sic); abusing the “trust;” going “too far” thereby turning the corporate good ship Lollipop into Blackbeard’s Queen Anne’s Revenge.
When, and better sooner than later, the bourgeoisie are finally eliminated, planted face down and buried in quicklime, a tombstone shall be erected, a two-sided tombstone being the only appropriate marker for a class that spoke out of both sides of its mouth, and at the same time. On one side, the tombstone shall read, “Where’s Mine?” On the other side, it will read, “It Wasn’t Me.” Epitaph? Business card? You make the call. Me? I’m saying that it is more than either. The whole is the sum of its parts, and the whole is their business plan.
That’s how the world is for the bourgeoisie. It’s not just hypocrisy that informs their every utterance. It’s aphasia. In their dotage, and their dotage starts a day or two before they ascend to power, the bourgeoisie achieve an historical anti-synchronicity, unable to recognize the content of faces, emails, words, or common economic policies. They are perfectly out of phase. Value is the disavowal of reality.
No sooner did The Wall Street Journal run a headline proclaiming “Surging stocks are routing the bears” than the US Bureau of Economic Analysis issued its advance report on the change in the fourth quarter 2012 for the US gross domestic product. The BEA estimated that GDP decreased at annual rate of .1 percent from the third quarter. Of course, nothing so vague and imprecise as the advanced estimate of one quarter of GDP change coming from an organization so unreliable as the BEA would be enough to trigger even a minor sell-off on Wall Street. Only something with a record of real accuracy in predicting economic trends could do that...like if the Baltimore Ravens, the AFC champions, were to win the Super Bowl. Then the bulls would start to worry.
The conflict between market direction and economic reports provides the basis for two of the bourgeoisie’s favorite activities, making predictions about the economy, and equivocating when making predictions about the economy. Equivocation is prediction’s chaperone.
Prediction is, for and to a class so consumed with denying history, and disavowing the present, nothing but a market position—long or short. Equivocation is the hedge on that position—not that long, not too short..
In the US, the GDP declines and some take a position in the market, warning of a “double-dip” recession. Europe, of course, is in a double-dip recession, and in the UK, whose position within the common European market has been hedged into isolation, the talk is of a “triple-dip” recession. If people in hell had ice cream cones, they could be political economists.
The US BEA attributed the 4th Q GDP decline to decreases in private business inventories, a drop in exports, and the reduction in federal government expenditures. National defense spending declined 22 percent in the quarter. Bad news? Go short? Hedge?
However, real non-residential fixed investment increased 8.4 percent when compared to the previous quarter. Spending on equipment and software, as distinct from structures, rose 12.4 percent. Good news? Go long? Hedge?
So everybody wants to know, more or less, what’s up ahead. How bright or gloomy is the future? Sunglasses or mourning veils? Up or down? On or off? Buy or sell? And let’s not forget, is the glass half-empty or is it half-full?
Here’s the answer: There is nothing in the glass that’s fit for drinking.
2. “The real barrier of capitalist production is capital itself,” wrote Marx in Capital, vol 3. The limit to capitalist production is the very basis for capitalist production. The conversion of the products of labor into commodities, and the realization of commodities as values, requires the division of the working day into necessary labor time, the time it takes for the workers to reproduce the means of their own subsistence, or more precisely the value equal to the means of purchasing their own subsistence, and the surplus labor time—that time of production which is aggrandized by the capitalist and which forms the increment of expansion of the total capital , the total costs, of the production. Necessary labor time becomes both the basis and the limitation to surplus labor time. The organization of wage-labor, the very existence of the wage rather than simply its magnitude, places a limit, a barrier, and obstacle to the aggrandizement of surplus value in the creation of surplus value.
The obstacle itself propels capital to overcome the limitation, in the only way it can, compressing further the necessary working time, reducing the reproduction time of the wage by expelling labor from production, substituting already accumulated value, in the form of machinery, improved materials and materials handling, refined control processes; in short adding to the bulk of capital which will necessarily reduce the increment of profit extracted from the surplus value. The conflict is overcome. The conflict is recreated. Things get better. Things go from bad to worse. The economy perks up. The economy crawls.
The expulsion of labor, the reduction of the necessary time means that the intensified exploitation is not, or cannot remain, intense enough. The boost to the rate of exploitation is converted anew into capital and consequently the increment of changes in the rate of exploitation shrink. Necessary labor cannot be eliminated, under capitalism, for to do so will eliminate the basis of surplus value. Capitalism runs up the inside of the walls of a cage of its own making
The corollary to Marx’s “appreciation” of capital, that obstacles and barriers are offsets and stimuli, is that contraction and expansion each take on the characteristics of the other, and become less and less distinguishable. What it was is what it is and will be what it will be, until it’s overthrown.
3. In 2006 all was right with capital. All right, however, is never good enough. Corporate profits peaked that year. Profits for the mining, manufacturing, utilities , and construction sectors of the US economy rang in at $354 billion. That same year, the fixed assets deployed in those industries were valued at $4.976 trillion. Now we all know, or should know, what fixed capital is: fixed capital is that capital that is consumed only partially, incrementally, in any single cycle of production.
Oil is not fixed capital. The value of the oil consumed in the production of any set number of commodities is transferred completely, through cost/price, to the commodities produced with that oil. The furnace burning the oil is fixed capital. The value of the furnace burning the oil is not transferred completely to those commodities, as its use value remains beyond any production cycle.
The value, represented as cost/price, of the fixed capital can only be transferred completely to the cost/price, the exchange value, of the commodities for which it is deployed, through the extinguishing, the using up of its use value. Increasing the mass of commodities in production and circulation is not determined by competition. It is the economic necessity dictated by the expulsion of labor from the production process and the shift in the proportion of fixed capital deployed in production, a shift determined by the organization of labor as wage-labor, the presentation of labor as a commodity, the transformation of labor-power into necessary and surplus labor-times, the expression of labor time as value.
Things, that is to say relations, weren’t quite so all right in 2007, as capital investment had increased the value of the fixed assets to $5.369 trillion, approximately 11 percent above the previous year. The mass of wages, the mass of production hours had increased also, but much more modestly, by 1 percent. While revenues increased, both the mass and the rate of profitably declined. Manufacturing absorbed almost $3 trillion in processed, raw, and packaging materials while claiming just $301 billion in profits. The reproduction of capital, the ability to compress the necessary labor time at a rate and intensity sufficient to offset the increase in fixed assets, declined.
So begins the contraction of capital. The contraction accomplishes what the expansion cannot, precisely that compression of the necessary labor time, by…expelling labor, by…devaluing assets. Except…this all takes time. So that in 2008, with profits down some 40 percent from 2006, the manufacturing, mining, utilities, and construction sectors had boosted fixed asset values another 11 percent, driving down their wage bill, however, by only 3 percent.
In 2009, capital was finally able to synchronize its devaluation of assets with its expulsion of labor, driving down the wage bill by 15 percent, and the value of the fixed assets (through the mothballing, warehousing, retirement) by 5 percent. This set the stage for the profit recovery of 2010 and 2011.
The profit “recovery” was somewhat modest. The 2011 mark registered just 70 percent of the 2006 peak. Fixed asset valuations, however, recovered and exceeded $6 trillion, about $1.1 trillion above the 2006 valuation. Moreover, the wage bill, though below that of 2006, 2007, and 2008, exceeded that of 2009 and 2010.
The BEA has not yet released its figures for 2012, but the US Department of Commerce (the sponsor of the BEA) doesn’t have all its eggshells in this one basket. The department produces the Annual Survey of Manufacturers, and the Quarterly Financial Review of Manufacturing, Mining, Trade, and Selected Service Industries. This latter document reveals a year to year decline from 2011 to 2012 in the relation of after-tax profits to net property, plant and equipment.
No matter how the bourgeoisie choose to represent it, capital has not been able to exploit labor at a sufficient degree of intensity to achieve the conversion of assets into expanded values at rates of conversion previously established.
4. So what? So this. Because assets continue to accumulate, and the compression of the necessary labor time approaches limits that are the very essence of wage-labor, and cannot be overcome by capitalism, by the exchange of value, by the circulation of commodities, then the assets of production, accumulated and living, fixed and circulated, breathing and not, have to be destroyed. The price of labor-power must be driven below the social costs of its reproduction. This “simple necessity” of capital sentences entire peoples, countries, and decades to devaluation and destruction. The “Great Recession” is not over. It has barely begun. The privation and misery forced upon Greece, Iraq, Ireland, San Bernadino is not a “sometime” thing. We haven’t seen anything yet…of what capitalism will command, and with that “lack of vision” we’ve seen the future.
February 10, 2013