My fellow Americans:
Sometimes, you just have to cut the crap about faith and hope and progress and this land being your land and the perfectability of man and the enormous potential of clean coal and just spit it out, with the emphasis on the spit. Word.
As a species we distinguish ourselves through-- besides our eagerness to kill so many unknown, unencountered, unthreatening members of our own species-- our affliction with addictions and our addiction to afflictions. Word.
Nothing gives us more pleasure than satisfying our own addictions, but seeing some poor sot suffering miserably, unable to satisfy his or hers comes in a close second. Word.
We are not only participants we are observers... and from a distance, what is easier, more interesting, diverting, riveting, than seeing others like- but not- us suffering endlessly, miserable in the grips of.... whatever. Who really cares? Now that's entertainment. Word.
From a distance, I mean. Distance being the critical word. Word. As in don't come too close; do not touch; keep off the grass; God forbid we should get any of that, of them on us. You know what I mean? I know you know what I mean.
Speaking of god-- there isn't one, or two, or many, but god is, and is all powerful because god is affliction and addiction all rolled up into one... the Big One, the Universal One, the All of Us One... which accounts for all the violence associated with religion. It makes no sense, ergo let's go out and kill. God bless you.
It, religion, is us at our best, inflicting ourselves on each other, complete with afflictions and addictions, and getting some of us on each of us in the name of god. Word. Oh happy, and holy, day. Oh most perfect, supreme, sanctified anti-species being.
That's how I see it. Of course, I also think that history is a play acted by fools for the enjoyment of cynics. And vice-versa. Waiting for Godot? And what about Godot? What's he waiting for? And why is he delayed? They pretend Godot is going or coming, but can't tell which, and he plays along by pretending to even exist.
Pretending, pretense.... pretension. That's another one of our distinguishing characteristics, along with species slaughter, and addiction.
Speaking of species, this is the 200th anniversary of the birth of Charles Darwin and Darwin never said evolution was smart, or progressive, or better-- just that it is adaptive. Evolution, unlike god, really is and like god, is mindless, bloody, ignorant and often a mistake. But tough to stop.
That's something else we are, adaptive. We can move our afflictions and our addictions and our anti-species being species all over the globe and soon enough other planets, which for their own sake should be more than uninhabitable, they need to be downright hostile so that we will move on with our afflictions and addictions, gods, history, drama, evolution, needs, and leave them peacefully barren.
So there you have it. And so do I. Please don't think that I hold myself apart, exempt myself from this dismal science that is we, us, you, me... humanity.
Speaking of humanity, what was it the radio announcer said, collapsing in tears as the Hindenburg lit itself up over New Jersey-- "Oh the humanity"? Right. Oh the humanity, ladies and gentlemen. Which is why we thrill to watching that particular piece of newsreel time and time again, wondering about the humanity trapped in that furnace. Give us the spectacular "accident," and we're plowing through the Kleenex like disappointed heirs at the reading of a will. But as for the daily, programmed murder that makes up our waking hours.... whatever. Word.
Anyway that's it. That's you and me and us and we. And that's why, right now, I've got to stop-- take a time out, attend to my addiction to affliction and vice-versa, cooking up this little dose of brown powder that came all the way from Afghanistan, and synching up the podcasts I have of the Jerry Springer show. Don't get too close, I wouldn't want to get any of me on you. Word.
sartesian@earthlink.net
Tuesday, January 20, 2009
Sunday, January 11, 2009
Not Just, Just Not 2
4. The petroleum industry gives capitalism, in all its petty victories and melodramatic setbacks, its most acute presentation. In its accumulation of capital, its expansion of its property, the industry amasses a machinery of extraction, an asset base, a net property, plant, and equipment, that measures its efficiency in the reduced, now relatively, then absolutely, quantities of wage-labor required to animate the physical plant. In its development, then, the petroleum industry confronts the predicament of capital in a hard way-- the more of its capital it accumulates, the more capital it exchanges with wage labor, the less relatively of itself has in fact been exchanged with wage labor, and the lower the rate of accumulation becomes.
In 2006, the net PPE of the FRS companies was valued at $666.9 billion. In 2007, the value of the PPE increased 4.5 percent to $697 billion. For US manufacturing as a whole, the values were $1217.7 billion and $1229 billion respectively, giving the FRS companies an asset share of about 56 percent of the total US PPE.
This massive fixed investment is animated by a labor force, and a "wage-bill" dramatically smaller than the labor force and wage-bill for US manufacturing.
The number of production workers, adjusted for those self-employed in the petroleum industry, has increased from approximately 111, 000 in 2004 to 127, 000 in 2007. At the same time, the wage-bill for the petroleum [unadjusted] has increased from approximately $13.2 billion to $19.2 billion.
During this same period, production worker numbers in manufacturing, adjusted for self-employment declined from 14.1 million to 13.7 million. The wage-bill in manufacturing [unadjusted] climbed at a considerably lower rate, from $704.4 billion to $746 billion.
With a wage-bill equal to less than 3% of that of manufacturing, the petroleum industry is able to animate property, plant and equipment with a value equal to half of that total value for manufacturing.
It is this, this incredible increased/diminished exchange, this PPE "overweight" in relation to wages, rather than the utility of oil, that gives the petroleum industry its specific gravity, its determinant quality for capitalism as a whole.
5. With this massive accumulation of industrial plant, the "super-productivity of labor, the costs of production and reproduction of the unit quantities of oil are driven to a near-absolute minimum, including in the areas of "difficulty" like the North Sea. The petroleum industry engages in a battle against the enemy that is both itself and the shadow of itself, a declining rate of return. The industry must seek, by hook, crook, line, and sinker, offsets to this decline. Seek and find it does, utilizing market, cartel, and state mechanisms to alter the unit price above the cost of production, and above the price of production, effectively, transferring profit from all other industries to itself.
6. The increased capital investments from 1992-2000 drove the rate of return on investment for capitalism as a whole up and then into decline, leading to the recession of 2001-2003.
The US bourgeoisie, knowing better than some that overproduction is not underconsumption, that overproduction is exactly as Marx described it-- an overproduction of the means of production of capital unable to exploit labor at a sufficient intensity-- built the recovery of 2003 on basis of reduced capital spending, reduced rates of expansion of the means of production, accumulation of capital as money to be hoarded, or distributed to executives, owners, investors, in a word to its classmates, and of course, control of wage rates.
The asset-backed securitization that swept through the US economy during this period was in fact derivative of the restraint on investment and accumulation maintained in the industrial sector.
Indeed, in 2002, 2003, 2004 capital spending was below the values claimed for depreciation and capital consumption of property, plant, and equipment. In the third-quarter of 2001, net PPE for US manufacturing was measured at $1180 billion. A year later, that figure had declined to $1173 billion. By the third-quarter of 2003, the value was $1142 billion, and by the third-quarter 2004, $1101 billion, equal to the net value of PPE in 1999.
While operating income did recover, something else recovered even more for US manufacturing-- and that was recurring income from non-operating sources. These non-operating sources include interest payments, dividends, royalties, earning from minority interests in other businesses. Prior to the recession of 2001, these revenue streams were about 33 to 40 percent of the amounts for operating earnings. However, after 2004, the size of all other income from non-operating sources increases to 50, then 60, and 70-75 percent of the amount for operating earnings, and accounts for almost 40 percent of total income. The US bourgeoisie was earning its money the old-fashioned way-- by making others work productively for it.
At the same time cash, US government securities, and other securities held by US manufacturing companies increased 50 percent from 2003 levels, peaking in the 4th quarter 2007 at $454 billion.
It was a closed fist policy of US manufacturing between 2002 and 2005 , building its cash hoard, investing in stock buybacks, awarding dividends. The FRS companies, awash in cash, averaged $37 billion in stock buybacks in 2004, 2005, 2006, and 2007, dedicating in those 4 years a sum almost about 45 percent greater than the total spent for the 17 years prior.
This closed fist, clasped hand policy created the open palm policy of the investment and commercial banks, the mortgage financing agencies, and the thrift institutions. The only revenue streams that the financiers could tap, that they could attack and divert, were those based on wages and salaries, on the personal income of those working and poor, working and not so poor.
7. The "discipline," in reality deprivation, that the bourgeoisie practiced upon capital spending and fixed assets, it practiced also on the wage portion of capital's identity. By 2003, the manufacturing wage bill had declined 6 percent from its 2001 level. In 2006, the total wage outlay finally surpassed the 2001 mark. By 2007, the manufacturing wage bill was 6 percent above the 2001 mark.
The wage-bill for the petroleum industry shrank also during those glory years of 2003-2006, with the hourly wage dropping 9 percent between 2001 and 2004, before recovering in 2005. In 2007, the industry's average hourly wage was 20 percent above its 2001 level.
In 2005, the petroleum industry resumed its capital expenditures. Unlike the wave of consolidations and mergers that had swept the industry earlier, a major portion of this spending was on actual actual exploration and development. In 2006, capital spending was a record high $200 million dollars. In 2007, while overall capital spending declined from its 2006 peak, development and exploration expenditures exceeded the 2006 level. What did the FRS companies buy with this money? Real estate. Expenditures on proven and unproven acreage in the US soared in 2005, 2006, and 2007. Total exploration and development expenditures in the US doubled between 2005 and 2006. FRS companies' acquisition of proven acreage outside the US also increased in 2006, but not nearly as dramatically.
So if overproduction is, and is always, the overproduction of the means of production as capital, unable to exploit sufficient quantities of labor at a required intensity, the petroleum industry overproduced itself by the book, the book being Capital, Vol 3, as both wage-rates and increases in net property, plant, and equipment took the "sufficient" out of profitability.
The dramatic contraction in the price of oil is, of course, just the market's way of reflecting the declining profitability, and the failure of all the mechanisms-- war, cartel, government-- to offset the decline.
The dramatic contraction in industrial output worldwide, is more than just the market's way of reflecting that decline on an international scale. The contraction means that the bourgeoisie in order to repair profitability must attack the accumulated means of production, devaluing and destroying fixed assets and physical plant, and attack the workers resistance to wage cuts, diminished standards of living, deprivation, and dispossession. Accumulation for capital never stops being primitive.
S. Artesian
address all comments to: sartesian@earthlink.net
In 2006, the net PPE of the FRS companies was valued at $666.9 billion. In 2007, the value of the PPE increased 4.5 percent to $697 billion. For US manufacturing as a whole, the values were $1217.7 billion and $1229 billion respectively, giving the FRS companies an asset share of about 56 percent of the total US PPE.
This massive fixed investment is animated by a labor force, and a "wage-bill" dramatically smaller than the labor force and wage-bill for US manufacturing.
The number of production workers, adjusted for those self-employed in the petroleum industry, has increased from approximately 111, 000 in 2004 to 127, 000 in 2007. At the same time, the wage-bill for the petroleum [unadjusted] has increased from approximately $13.2 billion to $19.2 billion.
During this same period, production worker numbers in manufacturing, adjusted for self-employment declined from 14.1 million to 13.7 million. The wage-bill in manufacturing [unadjusted] climbed at a considerably lower rate, from $704.4 billion to $746 billion.
With a wage-bill equal to less than 3% of that of manufacturing, the petroleum industry is able to animate property, plant and equipment with a value equal to half of that total value for manufacturing.
It is this, this incredible increased/diminished exchange, this PPE "overweight" in relation to wages, rather than the utility of oil, that gives the petroleum industry its specific gravity, its determinant quality for capitalism as a whole.
5. With this massive accumulation of industrial plant, the "super-productivity of labor, the costs of production and reproduction of the unit quantities of oil are driven to a near-absolute minimum, including in the areas of "difficulty" like the North Sea. The petroleum industry engages in a battle against the enemy that is both itself and the shadow of itself, a declining rate of return. The industry must seek, by hook, crook, line, and sinker, offsets to this decline. Seek and find it does, utilizing market, cartel, and state mechanisms to alter the unit price above the cost of production, and above the price of production, effectively, transferring profit from all other industries to itself.
6. The increased capital investments from 1992-2000 drove the rate of return on investment for capitalism as a whole up and then into decline, leading to the recession of 2001-2003.
The US bourgeoisie, knowing better than some that overproduction is not underconsumption, that overproduction is exactly as Marx described it-- an overproduction of the means of production of capital unable to exploit labor at a sufficient intensity-- built the recovery of 2003 on basis of reduced capital spending, reduced rates of expansion of the means of production, accumulation of capital as money to be hoarded, or distributed to executives, owners, investors, in a word to its classmates, and of course, control of wage rates.
The asset-backed securitization that swept through the US economy during this period was in fact derivative of the restraint on investment and accumulation maintained in the industrial sector.
Indeed, in 2002, 2003, 2004 capital spending was below the values claimed for depreciation and capital consumption of property, plant, and equipment. In the third-quarter of 2001, net PPE for US manufacturing was measured at $1180 billion. A year later, that figure had declined to $1173 billion. By the third-quarter of 2003, the value was $1142 billion, and by the third-quarter 2004, $1101 billion, equal to the net value of PPE in 1999.
While operating income did recover, something else recovered even more for US manufacturing-- and that was recurring income from non-operating sources. These non-operating sources include interest payments, dividends, royalties, earning from minority interests in other businesses. Prior to the recession of 2001, these revenue streams were about 33 to 40 percent of the amounts for operating earnings. However, after 2004, the size of all other income from non-operating sources increases to 50, then 60, and 70-75 percent of the amount for operating earnings, and accounts for almost 40 percent of total income. The US bourgeoisie was earning its money the old-fashioned way-- by making others work productively for it.
At the same time cash, US government securities, and other securities held by US manufacturing companies increased 50 percent from 2003 levels, peaking in the 4th quarter 2007 at $454 billion.
It was a closed fist policy of US manufacturing between 2002 and 2005 , building its cash hoard, investing in stock buybacks, awarding dividends. The FRS companies, awash in cash, averaged $37 billion in stock buybacks in 2004, 2005, 2006, and 2007, dedicating in those 4 years a sum almost about 45 percent greater than the total spent for the 17 years prior.
This closed fist, clasped hand policy created the open palm policy of the investment and commercial banks, the mortgage financing agencies, and the thrift institutions. The only revenue streams that the financiers could tap, that they could attack and divert, were those based on wages and salaries, on the personal income of those working and poor, working and not so poor.
7. The "discipline," in reality deprivation, that the bourgeoisie practiced upon capital spending and fixed assets, it practiced also on the wage portion of capital's identity. By 2003, the manufacturing wage bill had declined 6 percent from its 2001 level. In 2006, the total wage outlay finally surpassed the 2001 mark. By 2007, the manufacturing wage bill was 6 percent above the 2001 mark.
The wage-bill for the petroleum industry shrank also during those glory years of 2003-2006, with the hourly wage dropping 9 percent between 2001 and 2004, before recovering in 2005. In 2007, the industry's average hourly wage was 20 percent above its 2001 level.
In 2005, the petroleum industry resumed its capital expenditures. Unlike the wave of consolidations and mergers that had swept the industry earlier, a major portion of this spending was on actual actual exploration and development. In 2006, capital spending was a record high $200 million dollars. In 2007, while overall capital spending declined from its 2006 peak, development and exploration expenditures exceeded the 2006 level. What did the FRS companies buy with this money? Real estate. Expenditures on proven and unproven acreage in the US soared in 2005, 2006, and 2007. Total exploration and development expenditures in the US doubled between 2005 and 2006. FRS companies' acquisition of proven acreage outside the US also increased in 2006, but not nearly as dramatically.
So if overproduction is, and is always, the overproduction of the means of production as capital, unable to exploit sufficient quantities of labor at a required intensity, the petroleum industry overproduced itself by the book, the book being Capital, Vol 3, as both wage-rates and increases in net property, plant, and equipment took the "sufficient" out of profitability.
The dramatic contraction in the price of oil is, of course, just the market's way of reflecting the declining profitability, and the failure of all the mechanisms-- war, cartel, government-- to offset the decline.
The dramatic contraction in industrial output worldwide, is more than just the market's way of reflecting that decline on an international scale. The contraction means that the bourgeoisie in order to repair profitability must attack the accumulated means of production, devaluing and destroying fixed assets and physical plant, and attack the workers resistance to wage cuts, diminished standards of living, deprivation, and dispossession. Accumulation for capital never stops being primitive.
S. Artesian
address all comments to: sartesian@earthlink.net
Thursday, January 08, 2009
NOT JUST ALL ABOUT THE OIL, 1.
1. When Marx wrote in Capital, Volume 1 that "capital comes [into the world] dripping from head to foot with blood and dirt," he wasn't kidding. He wasn't just using a particularly rich metaphor to identify the brutality at the core of the "free" economy. He was not simply capturing in a single phrase the vicious venality of the bourgeoisie.
Marx was first and foremost describing the actual historical process that changed, and changes, the means of subsistence, the means of production, and human labor from quantities into specific qualities, from objects, articles, attributes to conditions and relations. Marx was describing the history of the transformation of land, production, and labor into the interpenetrating relationship of capital and wage-labor.
It is this immediate, enduring, opposite identity of capital and wage-labor that forms the not very secret secret of "primitive accumulation." It is the the expanded exchange of capital with wage-labor that is whispered in every market, and in all capitalist accumulation. .
Capitalism never rids itself of its primitive origins. It does not, and cannot, "clean up well." Expropriation and dispossession are its core. It embeds a little bit of primitive accumulation in every commodity produced, in every one of its billions of exchanges, in every cent of profit so realized.
As it expands, capital's ability to create enough of that profit quickly enough changes. Those very increases in accumulated capital become, sooner rather than later, incapable of sustaining continued expansion. The dollars and euros and yen that gushed from the markets disappear. Barely a penny is spat out where rivers of liquidity once flowed. But the conditions of production have not changed-- capital remains capital, and exchanges with labor that remains wage-labor. And if the conditions have not changed, then capital's ebb flow, its expansion and contraction, must be the product of the changes in the quantities of wage-labor and capital, and the change in the relationship of those quantities. In its contraction realizes the truth of the secret of its expansion-- overproduction, the overproduction of the means of production as capital once able now unable to exploit a sufficient quantity of wage-labor at a sufficient intensity. The means of production have come into conflict with their own conditions, with the social relations of production, with the ownership of production as a private property.
2. The importance of oil to "modern" society is no secret at all. While manufacturing and industry have managed to reduce the amount of oil required for the production of each unit, each commodity, the expansion of production requires increased inputs of energy. Transportation likewise can reduce its oil consumption per unit of value hauled but it cannot change the fact that petroleum provides 98 percent of the energy used in transportation. Circulation sweats money from every pore, as Marx wrote, but oil provides the heat.
The importance of oil in manufacturing, transportation, energy production-- these things are the useful values of oil. These physical attributes however are nothing more than the mule, the pack animal, carrying the conditions for the production of oil, the exchange value, into the markets for the bourgeoisie.
Since 1973, every critical juncture in this miserable, dreary saga of "modern" capitalism has been announced, concluded, and foreclosed upon with a dramatic change in the price of oil. The OPEC price spikes of 1973 and 1979; the price decline of 1986 that finally brought the Soviet Union to ground; the run-up to the first Gulf War, with prices reaching $40 per barrel; the collapse of 1998 with prices sinking below $10 per barrel; OPEC's "third time is the charm" production cuts, triggering the doubling and tripling of prices; the price collapse of 2002, signaling that it was past time for another Gulf War; the speculative blow-off and then price implosion of 2007-2008-- all are different chapters to the same book where every line begins with the word "overproduction."
Capital comes into the world dripping blood and dirt from head to foot, but everywhere it steps, it leaves its hydrocarbon footprint. Everywhere it rest its head, it leaves a greasy stain.
3. It is the condition of the production of oil, and not the qualities of the oil itself, that makes the petroleum industry so dominant, so acute to the conditions of capital accumulation as a whole. It is the relationship between the massive capital apparatus of the industry and the wage-labor required to animate that apparatus that makes the petroleum industry so much more than representative of capitalism as a whole.
In 2007, according to the US Energy Information Agency's (EIA) Performance Profiles of Major Energy Producers, US petroleum companies participating in its Financial Reporting System (FRS) reported their first decline in net income after three successive years of record earnings in 2004, 2005, and 2006. The companies participating in the FRS account for approximately 41 percent of the petroleum, natural gas liquids, and natural gas production of US companies. Net income in 2007 declined 8 percent from the 2006 mark to 125 billion dollars. This "reduced" net income was still the third highest amount recorded in the history of the industry.
For the first time since 2002, operating expenses grew at a rate faster than revenues.
More significantly, and most representatively of the predicament of capital, the return on investment, which the is defined as the ratio of net income to net property, plant and equipment (PPE) declined to 17 percent from the 2006 rate of 21 percent.
This ratio, the rate of return on investment, is, if not everything to capital, pretty close to everything for capital. It measures nothing other than the condition of capital; it's success at being itself, which is to say, its success at successfully exploiting wage-labor at a sufficient intensity; which is to say, its success at increased accumulation; which is to say its ability at reproducing itself, its power, its property.
So if the ratio of net income to net plant, property, and equipment is critical to the petroleum industry, then the ratio of the petroleum industry's net operating income to the total net income for all of US manufacturing, and the ratio of the petroleum industry's net property, plant, and equipment to that of all of US manufacturing is critical for measuring the importance of the petroleum industry to all of capital as value accreting. These ratios capture the specific gravity, the weight, of the petroleum industry in the system of capitalist reproduction and provide an index to the overall conditions of capital.
So... so for 2006, the operating income for the FRS companies was $199.4 billion, and the operating income for all US manufacturing was $420.5 billlion; in 2007, operating income for the FRS companies was $173.6 billion, and for US manufacturing $413.5 billion. Net income, after taxes and consolidating other sources of income, for FRS companies in 2006 and 2007 measured $134.9 billion and $124.8 billion respectively. For US manufacturing companies, the numbers were $487.0 billion and $436.8 billion.
Clearly, the FRS companies capture a significant portion of the realized profits of all capitalist production, garnering 47 percent of all manufacturing operating earnings in 2006, 42 percent in 2007. Just as significantly, the FRS portion of total net income declines, registering approximately 28 percent of the total in each year.
The tendency of US manufacturing companies to generate signifcant portions of net income from sources other than operations is why this analysis, why this decade is not just all about the oil.
Next: Not Just, 2
Address all comments to: sartesian@earthlink.net
Marx was first and foremost describing the actual historical process that changed, and changes, the means of subsistence, the means of production, and human labor from quantities into specific qualities, from objects, articles, attributes to conditions and relations. Marx was describing the history of the transformation of land, production, and labor into the interpenetrating relationship of capital and wage-labor.
It is this immediate, enduring, opposite identity of capital and wage-labor that forms the not very secret secret of "primitive accumulation." It is the the expanded exchange of capital with wage-labor that is whispered in every market, and in all capitalist accumulation. .
Capitalism never rids itself of its primitive origins. It does not, and cannot, "clean up well." Expropriation and dispossession are its core. It embeds a little bit of primitive accumulation in every commodity produced, in every one of its billions of exchanges, in every cent of profit so realized.
As it expands, capital's ability to create enough of that profit quickly enough changes. Those very increases in accumulated capital become, sooner rather than later, incapable of sustaining continued expansion. The dollars and euros and yen that gushed from the markets disappear. Barely a penny is spat out where rivers of liquidity once flowed. But the conditions of production have not changed-- capital remains capital, and exchanges with labor that remains wage-labor. And if the conditions have not changed, then capital's ebb flow, its expansion and contraction, must be the product of the changes in the quantities of wage-labor and capital, and the change in the relationship of those quantities. In its contraction realizes the truth of the secret of its expansion-- overproduction, the overproduction of the means of production as capital once able now unable to exploit a sufficient quantity of wage-labor at a sufficient intensity. The means of production have come into conflict with their own conditions, with the social relations of production, with the ownership of production as a private property.
2. The importance of oil to "modern" society is no secret at all. While manufacturing and industry have managed to reduce the amount of oil required for the production of each unit, each commodity, the expansion of production requires increased inputs of energy. Transportation likewise can reduce its oil consumption per unit of value hauled but it cannot change the fact that petroleum provides 98 percent of the energy used in transportation. Circulation sweats money from every pore, as Marx wrote, but oil provides the heat.
The importance of oil in manufacturing, transportation, energy production-- these things are the useful values of oil. These physical attributes however are nothing more than the mule, the pack animal, carrying the conditions for the production of oil, the exchange value, into the markets for the bourgeoisie.
Since 1973, every critical juncture in this miserable, dreary saga of "modern" capitalism has been announced, concluded, and foreclosed upon with a dramatic change in the price of oil. The OPEC price spikes of 1973 and 1979; the price decline of 1986 that finally brought the Soviet Union to ground; the run-up to the first Gulf War, with prices reaching $40 per barrel; the collapse of 1998 with prices sinking below $10 per barrel; OPEC's "third time is the charm" production cuts, triggering the doubling and tripling of prices; the price collapse of 2002, signaling that it was past time for another Gulf War; the speculative blow-off and then price implosion of 2007-2008-- all are different chapters to the same book where every line begins with the word "overproduction."
Capital comes into the world dripping blood and dirt from head to foot, but everywhere it steps, it leaves its hydrocarbon footprint. Everywhere it rest its head, it leaves a greasy stain.
3. It is the condition of the production of oil, and not the qualities of the oil itself, that makes the petroleum industry so dominant, so acute to the conditions of capital accumulation as a whole. It is the relationship between the massive capital apparatus of the industry and the wage-labor required to animate that apparatus that makes the petroleum industry so much more than representative of capitalism as a whole.
In 2007, according to the US Energy Information Agency's (EIA) Performance Profiles of Major Energy Producers, US petroleum companies participating in its Financial Reporting System (FRS) reported their first decline in net income after three successive years of record earnings in 2004, 2005, and 2006. The companies participating in the FRS account for approximately 41 percent of the petroleum, natural gas liquids, and natural gas production of US companies. Net income in 2007 declined 8 percent from the 2006 mark to 125 billion dollars. This "reduced" net income was still the third highest amount recorded in the history of the industry.
For the first time since 2002, operating expenses grew at a rate faster than revenues.
More significantly, and most representatively of the predicament of capital, the return on investment, which the is defined as the ratio of net income to net property, plant and equipment (PPE) declined to 17 percent from the 2006 rate of 21 percent.
This ratio, the rate of return on investment, is, if not everything to capital, pretty close to everything for capital. It measures nothing other than the condition of capital; it's success at being itself, which is to say, its success at successfully exploiting wage-labor at a sufficient intensity; which is to say, its success at increased accumulation; which is to say its ability at reproducing itself, its power, its property.
So if the ratio of net income to net plant, property, and equipment is critical to the petroleum industry, then the ratio of the petroleum industry's net operating income to the total net income for all of US manufacturing, and the ratio of the petroleum industry's net property, plant, and equipment to that of all of US manufacturing is critical for measuring the importance of the petroleum industry to all of capital as value accreting. These ratios capture the specific gravity, the weight, of the petroleum industry in the system of capitalist reproduction and provide an index to the overall conditions of capital.
So... so for 2006, the operating income for the FRS companies was $199.4 billion, and the operating income for all US manufacturing was $420.5 billlion; in 2007, operating income for the FRS companies was $173.6 billion, and for US manufacturing $413.5 billion. Net income, after taxes and consolidating other sources of income, for FRS companies in 2006 and 2007 measured $134.9 billion and $124.8 billion respectively. For US manufacturing companies, the numbers were $487.0 billion and $436.8 billion.
Clearly, the FRS companies capture a significant portion of the realized profits of all capitalist production, garnering 47 percent of all manufacturing operating earnings in 2006, 42 percent in 2007. Just as significantly, the FRS portion of total net income declines, registering approximately 28 percent of the total in each year.
The tendency of US manufacturing companies to generate signifcant portions of net income from sources other than operations is why this analysis, why this decade is not just all about the oil.
Next: Not Just, 2
Address all comments to: sartesian@earthlink.net
Sunday, December 28, 2008
Le Metro
The ads are in every Metro car on lines 3,5, 8,10,11:
SPEAK WALL STREET ENGLISH!
The posters, despite the predicament of Wall Street, despite the fact that they are printed on plain cardboard and are not protected behind plastic or by lamination, remain, unfortunately, unaltered, untouched, unanswered by the most merciless of critics, those jurors of history, graffiti artists.
As a New Yorker in Paris, I wish to give back to my hosts by providing them with the following up-to-the-minute, essential guide for speaking Wall Street English:
1. We are closed until further notice
2. I'm thinking being laid off is an awesome opportunity for me to go out on my own and like really use my entrepreneurial skills.
3. What do you mean the account is "frozen"?
4. Comme dit on en francais, "The check bounced"?
5. We are not honoring requests for
---redemptions
---withdrawals
---explanations
6. The bank has repossessed my
---house
---cell phone
---car
---children
7. The number you have dialed has been disconnected. No further information is available.
8. Moved, left no forwarding address.
9. In accordance with USC 201.37, this building and all its contents have been seized by federal marshals for non-payment of taxes.
10. Can I get incorporated as a bank?
11. I'm broke.
12. [From Hudson in Aliens]: "How do I get out of this chicken-shit outfit?"
SPEAK WALL STREET ENGLISH!
The posters, despite the predicament of Wall Street, despite the fact that they are printed on plain cardboard and are not protected behind plastic or by lamination, remain, unfortunately, unaltered, untouched, unanswered by the most merciless of critics, those jurors of history, graffiti artists.
As a New Yorker in Paris, I wish to give back to my hosts by providing them with the following up-to-the-minute, essential guide for speaking Wall Street English:
1. We are closed until further notice
2. I'm thinking being laid off is an awesome opportunity for me to go out on my own and like really use my entrepreneurial skills.
3. What do you mean the account is "frozen"?
4. Comme dit on en francais, "The check bounced"?
5. We are not honoring requests for
---redemptions
---withdrawals
---explanations
6. The bank has repossessed my
---house
---cell phone
---car
---children
7. The number you have dialed has been disconnected. No further information is available.
8. Moved, left no forwarding address.
9. In accordance with USC 201.37, this building and all its contents have been seized by federal marshals for non-payment of taxes.
10. Can I get incorporated as a bank?
11. I'm broke.
12. [From Hudson in Aliens]: "How do I get out of this chicken-shit outfit?"
Saturday, December 27, 2008
December
Two days after Christmas, and the Israelis have proven they are children of the true Christianity; that they have the holiest of holy spirits in them, by bombing Gaza and killing and maiming. I omit the number of deaths and maimings intentionally. The numbers matter to those who were and are the beings that make up the numbers, those who knew, know, loved, love those who were and won't be again. The task is not in knowing those numbers; in reducing those numbers. The task is in abolishing the process that creates those numbers-- the process that survives only through destruction.
The numbers don't count to the Israelis. What counts, literally, is destruction. The numbers, the index to the efficiency to the process of destruction, are secondary to the all the bourgeoisie as it is destruction alone that maintains their property; destruction alone that preserves aggrandizement.
As the bourgeoisie demonstrate everyday and in every way, their zeal for, and fidelity to, efficiency is vastly overrated. Efficiency is only an euphemism for aggrandizement. The Israelis, perfect vectors, cats' paws, proxies, derivatives, of and for the bourgeoisie are perfect examples of efficiency efficiently debased, profitably devalued, and made vitally wasteful and vice-versa to the real project of capital which is exacty that debasement, devaluation, destruction.
There is no basis for the existence of the state of Israel other than destruction, devaluation, debasement. The mythology of making the "desert bloom," of "technological progress," is nothing other than misdirection, the smoke and the anti-mirror to cover the destruction of the original social relations. In this, the Israelis are the true heirs to the Boers of South Africa; to the apartheid rule of Verwoerd, de Klerk and Botha; to the US of Nixon and his Christmas Bombings; to the United States and its destruction of Iraq.
There can be no two-state solution; there can be no one-state solution. There can be no solution without the revolutionary overthrow of the Israeli state. Attempts at Israel's simple destruction are worse than fruitless; they are necessary to its very existence. The transition then from resistance to revolution requires the socialist rejection of Arab nationalism by the displaced, the immiserated Palestinians and by the workers of Egypt, Syria, Lebanon, Jordan.
December 27, 2008
address all comments to:
Saturday, December 13, 2008
RETURN TO BOLIVIA
1. THE MOOR'S LAST SIGH
Abu 'abd-Allah, Muhammad XII, the last Moorish king of Granada, assumed power in 1482 after his father had been driven from the land. His mother, made of sterner stuff, stayed.
In 1483, Abu invaded Castile. Unsuccessfully. Captured, he obtained his release after promising to rule Granada as a tributary kingdom to that of Ferdinand and Isabella, a couple of vampires if ever any existed in human form.
In 1489, called upon by the merged and acquisitioned houses of Castile and Aragon to surrender Granada in toto, he resisted. Unsuccessfully.
On January 2, 1492 the royal standards of Castile and Aragon, the banner of St. James, and a cross were raised at the summit of the Alcazaba, oldest section of the palace and fort that was the Alahambra.
The surrender of Granada was not just defeat, it was also ceremony. It was not just conquest or reconquest, it was tranfer of title, conveyance of property.
A son of the royal family, taken prisoner in battle, was returned.
A daughter of Abu 'abd-Allah was taken as concubine, mistress to Ferdinand. Nothing conveys title to property like rape .
As Abu 'abd-Allah rode away from the Alahambra he turned for one final look, for one last sigh. He wept. His mother, made of sterner stuff, said "You do well to weep like a woman for what you could not defend as a man."
The rebuke was warranted. As were the tears.
And not only for the order, the culture that the Moors had created and would be destroyed, not only for what the Moors might have become, but for what Castile and Aragon were not, and could never be.
In the place of enlightenment and knowledge, cant and superstition.
In the place of experiment and investigation, inquisition.
In the place of hawks, dogs of god.
2. A PROJECTION OF BACKWARDNESS
Nowhere is that truth of what Castile and Aragon were not and could never be felt more acutely than in South America. Nowhere in South America is the legacy of what Spain was and could never be-- that legacy of ashes-- more alive than in Bolivia.
In the conquest of the Andes territories, Spain could subjugate the property of the Inca's empire, it could demolish, debilitate, infect those relations of land and labor, creating enclaves of what Spain was (and was not) at home in the body of the Inca's empire. Spain could not supplant completely those relations of land and labor; Spain could not revolutionize those relations, no more than it could revolutionize the relations of land and labor at home. The mercantile-landed estate compromise that was the basis of, that was monarchy itself was reproduced in the latifundio, in the indentured labor of indigineros, in the vice-royalties, in the economy of extraction.
Expansion and penetration by the Spanish crown were the intensification of extraction for export. Expansion and penetration were the import of backwardness. And this was not just because Spain was not England, was not, in the 16th, 17th, 18th centuries capitalist in its organization of land and labor. In not being England, in not being capitalist, in its backwardness, Spain showed to all of capitalism the future inferiority of private property in and as the organization of agriculture; the inability of landed private property to change the terms of of extraction to terms of development; the inability of private property in agriculture to support anything more than enclave capitalism.
3. THE WAGES OF INDENTURED LABOR
There is uneven and combined development, and then there is Bolivia. Throughout its history, and until the MNR took power in 1952, Bolivia maintained the hacienda, the allyu, and the communidades, the "free communities" of the indigeneros, of the "originals," as units of agricultural production. The Spaniards of the conquest, the creoles and mestizos of the liberation had no interest, no material interest in the development of a unitary and productive-- above subsistence level-- form of agricultural property, of agricultural labor.
That labor of the indigenous people was confined, restricted under the terms of both conquest and "liberation." Labor that was required for the extraction of wealth from the silver mines was indentured labor.
Landed property, the hacienda was bestowed by the royalty and vice-royalty as reward for those overseeing that indentured labor. The hacienda was a token of service, a symbolic wealth, archaic in its formation, and valued in its archaic-ism.
The labor that was not required for the mines was required to serve the hacienda, to serve that token of wealth, maintaining it in stasis, not expansion.
The labor that was organized in the allyus on and off the haciendas was organized around "subsistence +" production.
Labor that was organized in the free communities was assessed a tax which lined the pockets of the tax collectors.
The mita was abolished by Bolivar in 1825, but it lived on in the countryside in the form of the pongo, a labor service obligation imposed upon the indigenous peoples by the owners of the haciendas.
The pongo tethered the indigeneros to the large estates while the existence of the large estates themselves, claiming the most fertile land but leaving such land uncultivated, and unproductive, controlled the ability of the free communities to produce above subsistence levels.
While industrial capitalism drives itself forward, is driven forward, by its simultaneous needs to aggrandize and expel ever greater quantities of wage-labor, and in fact reproduces itself only in the aggrandizement and expulsion of greater quantities of wage-labor in the production process, the legacy of indentured labor in Bolivia was involution, declining domestic industry, declining domestic production, declining productivity.
As a consequence, the needs of the laboring population were unmet. Those unmet needs could only support artisan, handicraft production. Cities existed not as permanent markets for the exchange of labor with, and, for commodities, but as administrative centers.
As a consequence, imports from the industrial capitalist countries took over the domestic markets while domestic production collapsed. By the middle 19th century, Bolivia's domestic textile production had declined 70 percent from the colonial period. crushed under the weight of the manufactured, flimsy English cottons.
4. UNDEVELOPMENT
Except in the Cochabamba with the production of wheat and corn, the hacienda did not dominate agricultural production nor agricultural labor until the second half of the 19th century. The Cochabamba, as the granary of Bolivia, was the basis for the accumulation of wealth by merchants and landholders, and that wealth found its way out of the limits of the hacienda, and the merchants serving the haciendas, and into the mining enclaves.
A general expansion of international capitalism followed the crises and near-revolutions of 1848, stumbled and fell in 1857, and then resumed its course through the 1860s. The source for both expansion and contraction was the introduction of new and cheaper technologies into production. In Bolivia that brought the application of steam power to the mining operations of the Altiplano.
That expansion dragged in its wake all the contradictions of capitalism. At one and the same time, the mining enclaves required greater access to labor and greater control over the supply and cost of labor. At one and the same time, the mining enclaves required greater quantities, lower prices and more reliable delivery of agricultural products to its centers of production, while minimizing the cost to itself of the improvement in infrastructure and in agricultural techniques that could satisfy these requirements. The impulse to developing a domestic capitalism, transmitted in the activities necessary to support the expansion of mining production and the sale of products, sought protection through tariffs and taxes against British capitalism. At the same time, the mining-merchant-hacendado alliance, the enclave troika, opposed such tariffs, seeing increased costs to its own business if such restrictions were enacted.
Losing out with the takeover of the national government by Belzu in 1848, the mining alliance finally elected their man, Jose Maria Linares to the presidency in 1857. As important as the alliance was, it was an emerging alliance of an emerging capitalism. As rich as it might be, the alliance was not rich enough to provide full funding to its government. In 1860, the tribute tax, assessed against the indigineros, accounted for more than one-third of the government's budget. The revenue stream alone ensured the survival of the "free communities" of the indigenous peoples.
In beginning and in end, the parliamentary form of bourgeois government depends on the stability, security, and prosperity of the small-property holders of capitalism. Where and how else could the bourgeoisie find the funds and personnel to handle the administration, the management of pettiness and and venality so essential to their business of governing, and vice-versa? And where there is no stability, no prosperity of the small-property holder? When there are individuals but no actual class of small-property holders, what then? Then the caudillo, then the military man, the general, the man on the horse, then the maybe hero to a would-be petty-bourgeoisie, then the petty tyrant despised by those with, and for a lack of, breeding; the man with the horse moving now left, now right, but always and always so crudely in the direction of order, property, obedience.
No better example of this can be found than in the person of Bolivia's General Mariano Melgarejo, the caudillo barbero. Seizing power in 1864, Melgarejo realized the program of the mining-merchant-haciendado alliance.
In this troika, we have not just the hacendados acting as the equivalent of the plantation owners in the US South; we have not just the merchants playing the part equivalent to that of the merchants in New York and Boston implictly, explicitly supporting the slaveholder rebellion against the emerged bougeoisie. We have the hardest core of the bourgeoisie supporting the hacendados, the merchants against the further development of Bolivia beyond enclave and toward a national capitalism.
While this same period brought forth the destruction of slavery in the United States under the banner of "free soil"; while in Russia this same period produced an announcement of the emancipation of the serfs as capitalism whispered its presence behind the Czar's throne; in Bolivia "free soil" is the attack on the communal land tenure practices of the indigenous people. "Private property," "private farming," was the assault on the free communities; on the competition to the monopoly of ownership, a monopoly not of or buy individuals, of or by one or two producers, but the monopoly of individuals and producers as a social class. Private property in agriculture is an ideology covering the tethering of the indigenous peoples to the hacienda, to sustained poverty, to a labor supply, limited by and to below subsistence agriculture, that can be aggrandized and expelled at will.
5. HALF-STEPS TO NOWHERE
After, and because of WW 2, Bolivia experienced a radical reorganization of demographics. The population began a sustained and rapid migration from the countryside, from the haciendas, from the impoverished rural communities, and into the cities. During the second half of the 20th century, the ratio between urban and rural populations reversed itself so that 65% of the population resided in urban areas.
Within the demographic transformation, the "national revolution" of the MNR organized itself around "state capitalism" in industry-- the nationalization of industry in order to preempt its expropriation by the workers.
In the countryside, the MNR's preemptive focus was on creating a "true peasantry" that would metamorphize from peasantry to yeoman farmers to capitalized agricultural production. Private ownership and petty production were the goal.
That goal was fulfilled. In a torturous due process to establish title to lands, and compensate the latifundistas, the MNR did in fact destroy the haciendas. Peasant production, however, is not and cannot be self-capitalizing. It does not, of its own dynamics, compulsively seek expansion. Just the opposite is likely to occur. Population pressures, increased family sizes, lead to increased parcellization of the land, and sustained declines in productivity. In pre-empting the workers' revolution, in opposing the expropriation of private property, the MNR preserved the organization of the enclave economy which was not only incapable of supporting agricultural productivity, but inherently hostile to such productivity. The private capitalization of agriculture, like the state capitalization of industry, was a coda to the impossibility of capitalist development of Bolivia. The agrarian reform produced private ownership while perpetuating the social poverty of private, subsistence agricultural production.
Banzer proved the impossibility of the private capitalization of agriculture. Expanding Bolivia's indebtedness fourfold during his first reign, Banzer provided extensive subsidies, and grants of large tracts of land to European, and North American private and corporate farm interests to colonize Santa Cruz and the other lowland provinces.
After the overthrow of the MNR, the military governments tried to maintain an "alliance" with the rural producers. As conditions worsened in the countryside that "alliance" existed only at bayonet point. Peasant syndicates were organized, coalescing in the Confederacion Sindical Unica de Trabajadores Campesinos de Bolivia (CSUTCB). The radical Tupac Katari movement took over leadership of the CSUTCB, and in 1981 Genaro Flores, leader of the Tupac Katari movement, was elected leader of the Confederation of Bolivian Workers (COB).
The MNR, in its need to pre-empt a workers' revolution led by the miners pre-figured international capitalism's pre-emption of the old structure of the enclave economy during its retrenchment of the 1980s. Peasant unions, government workers, service-sector workers replaced the miners as the mainstay of the COB. In 1983, oil and gas replaced tin as the primary export. The old enclave was dead. Long live the new enclave.
In 1985 the reelection of Paz Estenssero completed the pre-emption with the closing of mines, reducing the workers ranks by 75 percent, dismantling the state run Confederation of Bolivian Mines (COMIBOL)-- all capped by removing Juan Lechin, the old war-horse and leader of the miners' union, from the COB.
6. THAT WAS THEN...
Decapitating the workers' movement was essential to both the change from old to new enclave and the maintenance of the status quo, accelerating the unevenness and distortion of land tenure in agriculture. Behind every free market stands the bayonet... and a University of Chicago trained politician. After his victory in the 1993 elections, Gonzalo Sanchez do Lozada, who ran as a fusion candidate in alliance with Tupac Katari Revolutionary Liberation Movement, introduced a series of "democratic," market-based reforms. The reforms included the law on Popular Participation, the law on Decentralizaton, effectively decentralizing the country, creating direct election to over 300 municipalities for indigenous peoples; the law on educational reform, which provided for primary school instruction in the local languages of the indigenous peoples; and the law on Capitalization, which led to the privatization of the five state-owned corporations.
The ideological focus of these programs was an intent to establish through decentralization and privatization functioning national markets. The national markets in return would create a functioning petty-bourgeoisie to administer, endorse, and accommodate the aggranizement of resources and the expropriation of labor.
Markets can only exist where property can be exchanged, where property is alienable; and to be alienable, property must be titled. As a consequence, in 1996 Sanchez introduced another law on land reform.
A decade before Evo Morales and the MAS came to power with the promise of a constituent assembly and a "new" constitution recognizing the rights of indigenous peoples, the MNR /TKRLM government of Gonzalo Sanchez amended the existing 1967 constitution to define Bolivia as multiethnic and pluricultural. A decade before Evo Morales and the MAS promised thorough and substantive land reform, the Sanchez's MNR government enacted legislation that recognized the historical legitimacy of the communal land tenure practices of the allyus and the free communidades, and exempted small rural property holders from taxation. A decade before Evo Morales and the MAS promised to takeover and redistribute land not being used "productively," the Sanchez government had enacted legislation authorizing such actions. In fact, the 2006 MAS law on land reform and the seizures of land that have taken place in Bolivia are based on the MNR's 1996 law.
In order to establish the legitimacy of the claims to land, and the forms of land tenure -- to establish the boundaries of enclaves within enclaves, the MNR reform of 1996, like the proposed MAS reforms, requires the accurate determination of title to the land. In 1995, the World Bank provided $23.7 million to Bolivia to create a National Land Administration.
The project's primary objectives were:
The project objectives are to achieve a more efficient and transparent land administration system, clarify the land tenure situation, identify public land suitable for small farmer settlements and promote a more sustainable use of the country's land resources. To achieve these objectives the project helped the Government to formulate land administration and policy reforms, obtain accurate land ownership information, carry out land studies, alleviate land conflicts and improve land transaction registration.
Abu 'abd-Allah, Muhammad XII, the last Moorish king of Granada, assumed power in 1482 after his father had been driven from the land. His mother, made of sterner stuff, stayed.
In 1483, Abu invaded Castile. Unsuccessfully. Captured, he obtained his release after promising to rule Granada as a tributary kingdom to that of Ferdinand and Isabella, a couple of vampires if ever any existed in human form.
In 1489, called upon by the merged and acquisitioned houses of Castile and Aragon to surrender Granada in toto, he resisted. Unsuccessfully.
On January 2, 1492 the royal standards of Castile and Aragon, the banner of St. James, and a cross were raised at the summit of the Alcazaba, oldest section of the palace and fort that was the Alahambra.
The surrender of Granada was not just defeat, it was also ceremony. It was not just conquest or reconquest, it was tranfer of title, conveyance of property.
A son of the royal family, taken prisoner in battle, was returned.
A daughter of Abu 'abd-Allah was taken as concubine, mistress to Ferdinand. Nothing conveys title to property like rape .
As Abu 'abd-Allah rode away from the Alahambra he turned for one final look, for one last sigh. He wept. His mother, made of sterner stuff, said "You do well to weep like a woman for what you could not defend as a man."
The rebuke was warranted. As were the tears.
And not only for the order, the culture that the Moors had created and would be destroyed, not only for what the Moors might have become, but for what Castile and Aragon were not, and could never be.
In the place of enlightenment and knowledge, cant and superstition.
In the place of experiment and investigation, inquisition.
In the place of hawks, dogs of god.
2. A PROJECTION OF BACKWARDNESS
Nowhere is that truth of what Castile and Aragon were not and could never be felt more acutely than in South America. Nowhere in South America is the legacy of what Spain was and could never be-- that legacy of ashes-- more alive than in Bolivia.
In the conquest of the Andes territories, Spain could subjugate the property of the Inca's empire, it could demolish, debilitate, infect those relations of land and labor, creating enclaves of what Spain was (and was not) at home in the body of the Inca's empire. Spain could not supplant completely those relations of land and labor; Spain could not revolutionize those relations, no more than it could revolutionize the relations of land and labor at home. The mercantile-landed estate compromise that was the basis of, that was monarchy itself was reproduced in the latifundio, in the indentured labor of indigineros, in the vice-royalties, in the economy of extraction.
Expansion and penetration by the Spanish crown were the intensification of extraction for export. Expansion and penetration were the import of backwardness. And this was not just because Spain was not England, was not, in the 16th, 17th, 18th centuries capitalist in its organization of land and labor. In not being England, in not being capitalist, in its backwardness, Spain showed to all of capitalism the future inferiority of private property in and as the organization of agriculture; the inability of landed private property to change the terms of of extraction to terms of development; the inability of private property in agriculture to support anything more than enclave capitalism.
3. THE WAGES OF INDENTURED LABOR
There is uneven and combined development, and then there is Bolivia. Throughout its history, and until the MNR took power in 1952, Bolivia maintained the hacienda, the allyu, and the communidades, the "free communities" of the indigeneros, of the "originals," as units of agricultural production. The Spaniards of the conquest, the creoles and mestizos of the liberation had no interest, no material interest in the development of a unitary and productive-- above subsistence level-- form of agricultural property, of agricultural labor.
That labor of the indigenous people was confined, restricted under the terms of both conquest and "liberation." Labor that was required for the extraction of wealth from the silver mines was indentured labor.
Landed property, the hacienda was bestowed by the royalty and vice-royalty as reward for those overseeing that indentured labor. The hacienda was a token of service, a symbolic wealth, archaic in its formation, and valued in its archaic-ism.
The labor that was not required for the mines was required to serve the hacienda, to serve that token of wealth, maintaining it in stasis, not expansion.
The labor that was organized in the allyus on and off the haciendas was organized around "subsistence +" production.
Labor that was organized in the free communities was assessed a tax which lined the pockets of the tax collectors.
The mita was abolished by Bolivar in 1825, but it lived on in the countryside in the form of the pongo, a labor service obligation imposed upon the indigenous peoples by the owners of the haciendas.
The pongo tethered the indigeneros to the large estates while the existence of the large estates themselves, claiming the most fertile land but leaving such land uncultivated, and unproductive, controlled the ability of the free communities to produce above subsistence levels.
While industrial capitalism drives itself forward, is driven forward, by its simultaneous needs to aggrandize and expel ever greater quantities of wage-labor, and in fact reproduces itself only in the aggrandizement and expulsion of greater quantities of wage-labor in the production process, the legacy of indentured labor in Bolivia was involution, declining domestic industry, declining domestic production, declining productivity.
As a consequence, the needs of the laboring population were unmet. Those unmet needs could only support artisan, handicraft production. Cities existed not as permanent markets for the exchange of labor with, and, for commodities, but as administrative centers.
As a consequence, imports from the industrial capitalist countries took over the domestic markets while domestic production collapsed. By the middle 19th century, Bolivia's domestic textile production had declined 70 percent from the colonial period. crushed under the weight of the manufactured, flimsy English cottons.
4. UNDEVELOPMENT
Except in the Cochabamba with the production of wheat and corn, the hacienda did not dominate agricultural production nor agricultural labor until the second half of the 19th century. The Cochabamba, as the granary of Bolivia, was the basis for the accumulation of wealth by merchants and landholders, and that wealth found its way out of the limits of the hacienda, and the merchants serving the haciendas, and into the mining enclaves.
A general expansion of international capitalism followed the crises and near-revolutions of 1848, stumbled and fell in 1857, and then resumed its course through the 1860s. The source for both expansion and contraction was the introduction of new and cheaper technologies into production. In Bolivia that brought the application of steam power to the mining operations of the Altiplano.
That expansion dragged in its wake all the contradictions of capitalism. At one and the same time, the mining enclaves required greater access to labor and greater control over the supply and cost of labor. At one and the same time, the mining enclaves required greater quantities, lower prices and more reliable delivery of agricultural products to its centers of production, while minimizing the cost to itself of the improvement in infrastructure and in agricultural techniques that could satisfy these requirements. The impulse to developing a domestic capitalism, transmitted in the activities necessary to support the expansion of mining production and the sale of products, sought protection through tariffs and taxes against British capitalism. At the same time, the mining-merchant-hacendado alliance, the enclave troika, opposed such tariffs, seeing increased costs to its own business if such restrictions were enacted.
Losing out with the takeover of the national government by Belzu in 1848, the mining alliance finally elected their man, Jose Maria Linares to the presidency in 1857. As important as the alliance was, it was an emerging alliance of an emerging capitalism. As rich as it might be, the alliance was not rich enough to provide full funding to its government. In 1860, the tribute tax, assessed against the indigineros, accounted for more than one-third of the government's budget. The revenue stream alone ensured the survival of the "free communities" of the indigenous peoples.
In beginning and in end, the parliamentary form of bourgeois government depends on the stability, security, and prosperity of the small-property holders of capitalism. Where and how else could the bourgeoisie find the funds and personnel to handle the administration, the management of pettiness and and venality so essential to their business of governing, and vice-versa? And where there is no stability, no prosperity of the small-property holder? When there are individuals but no actual class of small-property holders, what then? Then the caudillo, then the military man, the general, the man on the horse, then the maybe hero to a would-be petty-bourgeoisie, then the petty tyrant despised by those with, and for a lack of, breeding; the man with the horse moving now left, now right, but always and always so crudely in the direction of order, property, obedience.
No better example of this can be found than in the person of Bolivia's General Mariano Melgarejo, the caudillo barbero. Seizing power in 1864, Melgarejo realized the program of the mining-merchant-haciendado alliance.
In this troika, we have not just the hacendados acting as the equivalent of the plantation owners in the US South; we have not just the merchants playing the part equivalent to that of the merchants in New York and Boston implictly, explicitly supporting the slaveholder rebellion against the emerged bougeoisie. We have the hardest core of the bourgeoisie supporting the hacendados, the merchants against the further development of Bolivia beyond enclave and toward a national capitalism.
While this same period brought forth the destruction of slavery in the United States under the banner of "free soil"; while in Russia this same period produced an announcement of the emancipation of the serfs as capitalism whispered its presence behind the Czar's throne; in Bolivia "free soil" is the attack on the communal land tenure practices of the indigenous people. "Private property," "private farming," was the assault on the free communities; on the competition to the monopoly of ownership, a monopoly not of or buy individuals, of or by one or two producers, but the monopoly of individuals and producers as a social class. Private property in agriculture is an ideology covering the tethering of the indigenous peoples to the hacienda, to sustained poverty, to a labor supply, limited by and to below subsistence agriculture, that can be aggrandized and expelled at will.
5. HALF-STEPS TO NOWHERE
After, and because of WW 2, Bolivia experienced a radical reorganization of demographics. The population began a sustained and rapid migration from the countryside, from the haciendas, from the impoverished rural communities, and into the cities. During the second half of the 20th century, the ratio between urban and rural populations reversed itself so that 65% of the population resided in urban areas.
Within the demographic transformation, the "national revolution" of the MNR organized itself around "state capitalism" in industry-- the nationalization of industry in order to preempt its expropriation by the workers.
In the countryside, the MNR's preemptive focus was on creating a "true peasantry" that would metamorphize from peasantry to yeoman farmers to capitalized agricultural production. Private ownership and petty production were the goal.
That goal was fulfilled. In a torturous due process to establish title to lands, and compensate the latifundistas, the MNR did in fact destroy the haciendas. Peasant production, however, is not and cannot be self-capitalizing. It does not, of its own dynamics, compulsively seek expansion. Just the opposite is likely to occur. Population pressures, increased family sizes, lead to increased parcellization of the land, and sustained declines in productivity. In pre-empting the workers' revolution, in opposing the expropriation of private property, the MNR preserved the organization of the enclave economy which was not only incapable of supporting agricultural productivity, but inherently hostile to such productivity. The private capitalization of agriculture, like the state capitalization of industry, was a coda to the impossibility of capitalist development of Bolivia. The agrarian reform produced private ownership while perpetuating the social poverty of private, subsistence agricultural production.
Banzer proved the impossibility of the private capitalization of agriculture. Expanding Bolivia's indebtedness fourfold during his first reign, Banzer provided extensive subsidies, and grants of large tracts of land to European, and North American private and corporate farm interests to colonize Santa Cruz and the other lowland provinces.
After the overthrow of the MNR, the military governments tried to maintain an "alliance" with the rural producers. As conditions worsened in the countryside that "alliance" existed only at bayonet point. Peasant syndicates were organized, coalescing in the Confederacion Sindical Unica de Trabajadores Campesinos de Bolivia (CSUTCB). The radical Tupac Katari movement took over leadership of the CSUTCB, and in 1981 Genaro Flores, leader of the Tupac Katari movement, was elected leader of the Confederation of Bolivian Workers (COB).
The MNR, in its need to pre-empt a workers' revolution led by the miners pre-figured international capitalism's pre-emption of the old structure of the enclave economy during its retrenchment of the 1980s. Peasant unions, government workers, service-sector workers replaced the miners as the mainstay of the COB. In 1983, oil and gas replaced tin as the primary export. The old enclave was dead. Long live the new enclave.
In 1985 the reelection of Paz Estenssero completed the pre-emption with the closing of mines, reducing the workers ranks by 75 percent, dismantling the state run Confederation of Bolivian Mines (COMIBOL)-- all capped by removing Juan Lechin, the old war-horse and leader of the miners' union, from the COB.
6. THAT WAS THEN...
Decapitating the workers' movement was essential to both the change from old to new enclave and the maintenance of the status quo, accelerating the unevenness and distortion of land tenure in agriculture. Behind every free market stands the bayonet... and a University of Chicago trained politician. After his victory in the 1993 elections, Gonzalo Sanchez do Lozada, who ran as a fusion candidate in alliance with Tupac Katari Revolutionary Liberation Movement, introduced a series of "democratic," market-based reforms. The reforms included the law on Popular Participation, the law on Decentralizaton, effectively decentralizing the country, creating direct election to over 300 municipalities for indigenous peoples; the law on educational reform, which provided for primary school instruction in the local languages of the indigenous peoples; and the law on Capitalization, which led to the privatization of the five state-owned corporations.
The ideological focus of these programs was an intent to establish through decentralization and privatization functioning national markets. The national markets in return would create a functioning petty-bourgeoisie to administer, endorse, and accommodate the aggranizement of resources and the expropriation of labor.
Markets can only exist where property can be exchanged, where property is alienable; and to be alienable, property must be titled. As a consequence, in 1996 Sanchez introduced another law on land reform.
A decade before Evo Morales and the MAS came to power with the promise of a constituent assembly and a "new" constitution recognizing the rights of indigenous peoples, the MNR /TKRLM government of Gonzalo Sanchez amended the existing 1967 constitution to define Bolivia as multiethnic and pluricultural. A decade before Evo Morales and the MAS promised thorough and substantive land reform, the Sanchez's MNR government enacted legislation that recognized the historical legitimacy of the communal land tenure practices of the allyus and the free communidades, and exempted small rural property holders from taxation. A decade before Evo Morales and the MAS promised to takeover and redistribute land not being used "productively," the Sanchez government had enacted legislation authorizing such actions. In fact, the 2006 MAS law on land reform and the seizures of land that have taken place in Bolivia are based on the MNR's 1996 law.
In order to establish the legitimacy of the claims to land, and the forms of land tenure -- to establish the boundaries of enclaves within enclaves, the MNR reform of 1996, like the proposed MAS reforms, requires the accurate determination of title to the land. In 1995, the World Bank provided $23.7 million to Bolivia to create a National Land Administration.
The project's primary objectives were:
The project objectives are to achieve a more efficient and transparent land administration system, clarify the land tenure situation, identify public land suitable for small farmer settlements and promote a more sustainable use of the country's land resources. To achieve these objectives the project helped the Government to formulate land administration and policy reforms, obtain accurate land ownership information, carry out land studies, alleviate land conflicts and improve land transaction registration.
In its own evaluation of the success of the program, written in 2006, the World Bank concluded that the performance in reaching the objectives was "moderately successful." The project was moderately successful in that its objectives were so limited. The project goal for clarification of land tenure was set at 3 million hectares.
The Bolivian government's estimate of land requiring clarification of title identifies 110 million hectares requiring review, with only 20 million hectares having been reviewed in the last decade.
7. ...THIS IS NOW
Despite Goni's resignation and flight from the country, and despite the calls for his arrest and extradition to stand trial for ordering the murderous assaults of 2003; despite the bankruptcy of the MNR's programs of "state capitalism" and "market capitalism"-- not once, but five times-- these failures live on in the MAS programs of--- state capitalism, nationalization, land reform.
In fact, Bolivia remains an enclave economy. Ninety percent of its total exports are consist of "primary products," energy, minerals and raw agricultural products (for Brazil these products account for 50% exports. For Mexico, 25 percent).
Despite the revenue surge that was provided by the increased prices for gas the Morales government won from Brazil and Argentina, and despite the increased price for zinc provided by the deceased commodity boom, between 2003 and 2006 the overall rate of fixed capital formation in Bolivia has been flat. And this after the rate had declined 20% between 2000 and 2003
The much praised nationalization of the hydrocarbon sector has done little to create an even, but combined, development of the economy. The nationalization itself can be questioned as protest from Brazil resulted in a halt to the nationalization process, and a renegotiation of its terms so that Petrobras could maintain at least a 15 percent return on investment. Today, production by Petrobras accounts for 18% of Bolivian GDP, 24% of the tax revenues, 95% of refining, 23% of fuel distribution, and... Petrobras "manages" 46% of Bolivia's gas reserves.
Just as agriculture is not self-capitalizing, land tenure reform cannot be accomplished in the countryside alone. Land use cannot be reformed without the overthrow of the relations of landed property to labor; without the overthrow of the relations of private property to labor that have created and sustained the existing pattern of land tenure.
"Nationalization" has not and will not create a "national capitalism" but will only perpetuate the limitations of enclave capitalism throught its subordination of production to the world markets, the subordination of production to exchange.
Only when the relations of production in both city and countryside, in factory, workshop, mine, gas field, large farms are transformed into the relations of production for use will the material support be provided for alleviating the poverty of subsistence production and for sustaining the practice of agriculture in traditional communal forms.
S. Artesian
address all comments to:
Friday, November 28, 2008
Dismal Science, Wonderful World
Short...
The November 2008 issue of the Statistical Supplement to the Federal Reserve Bulletin is now available online.at: http://www.federalreserve.gov/pubs/supplement/2008/default.htm . The bulletin provides the Fed's estimates on industrial production and capacity use for the first two quarters of 2008 and compares them to the 2007 numbers.
If you look deeper into these numbers and compare them to historical data available in in Fed G.17 reports, available at http://www.federalreserve.gov/releases/g17/, you can discern the following:
Industrial Output: The Fed is using 2002 as its baseline for indexing growth and rates of growth in 2007 and 2008. 2002 was near the trough in the last recession, which only shows the Fed is scraping the bottom of the barrel in more ways than one.
In 2000, industrial output measured 116% of output in 1997.
In 2002, industrial output measured 110% of output in 1997.
In 2008, industrial output measured 111% of output in 2002, equivalent to 122% of 1997 output.
Industrial output in 2008 is approximately 4.5% greater than output in 2000.
2. Not Sweet
Now look at growth of industrial capacity.
First you will notice, unless you're an economist or a hedge fund manager, that annual capacity growth increases averaged about 4.6% per year for 1997, 1998, 1999, 2000.
In 2001, capacity growth declines to 1.7 % above the 2000 mark.
In 2002, capacity growth declines to 1.1 % above the 2001 mark.
In 2003, capacity growth remains at 1.1% above the 2002 mark.
In 2004, capacity growth "improves" to 1.6% above the 2003 level.
In 2005, capacity growth remains 1.6% above the 2004 level.
Now comes the uptick with increased capital investment.
In 2006, industrial capacity grows 2.4 percent.
In 2007, the capacity growth rate falls to 1.8 percent.
In 2008, FRB estimates are that industrial capacity growth slows again to 1.6 percent.
Rates of return on capacity investment had peaked in 2006, and once again were showing themselves to be more cost than benefit to profits.
All in all, output increases approximately 4.5% between 2000-2008, while capacity increases amount to approximately 13.5 percent.
These are the circumstances of overproduction that Marx described in Volume 3 of Capital:
Overproduction of capital never signifies anything else but overproduction of means of production-- means of production and necessities of life--which may serve as capital, that is serve for the exploitation of labor at a given degree of exploitation; for a fall in the intensity of exploitation below a certain point calls forth disturbances and stagnations in the process of capitalist production, crises, the destruction of capital...
Marx continues:
...there is periodically a production of too many means of production and the necessities of life to permit of their serving as means of exploitation of the laborers at a certain rate of profit...
...there follows swindle and a general promotion of swindle by frenzied attempts at new methods of production, new investments of capital, new adventures, for the sake of securing some shred of extra profit, which shall be independent of the general average and above it.
3. And Down Low
It certainly is not the case that the "real economy" was/is healthy and that the disturbances are the result of speculation, overextension of credit, fictitious capital, irrational exuberance, excess leverage, poor savings by consumers, etc. etc. The condition and terms of finance are determined by the condition of the real terms of production.
With output and investment so restrained by the bourgeoisie after the 2000-2003 period, finance's access to the revenue stream of industrial production through corporate lending, corporate bond underwriting, etc. was severely restricted.
If as Marx put it, overproduction is the overproduction of the means of production that cannot be deployed to exploit labor power at a required, sufficient, intensity, then finance capital's focus on the securitization of consumer debts, of mortgage payments, of student loans, represents the attempt to divert revenue away from wages, from the V component of capitalist production; to in effect, reduce wages.
Finance capital represents, not a vampire feeding on the body of so-called real capital, but the attempt to generate a sufficient intensity of exploitation of labor by means other than increased output and capacity growth. Financialization proves itself the most modern expression of the most primitive expropriation of surplus value by demanding and instigating the absolute reduction in the value of wage-labor.
S. Artesian
address all comments to: sartesian@earthlink.net
The November 2008 issue of the Statistical Supplement to the Federal Reserve Bulletin is now available online.at: http://www.federalreserve.gov/pubs/supplement/2008/default.htm . The bulletin provides the Fed's estimates on industrial production and capacity use for the first two quarters of 2008 and compares them to the 2007 numbers.
If you look deeper into these numbers and compare them to historical data available in in Fed G.17 reports, available at http://www.federalreserve.gov/releases/g17/, you can discern the following:
Industrial Output: The Fed is using 2002 as its baseline for indexing growth and rates of growth in 2007 and 2008. 2002 was near the trough in the last recession, which only shows the Fed is scraping the bottom of the barrel in more ways than one.
In 2000, industrial output measured 116% of output in 1997.
In 2002, industrial output measured 110% of output in 1997.
In 2008, industrial output measured 111% of output in 2002, equivalent to 122% of 1997 output.
Industrial output in 2008 is approximately 4.5% greater than output in 2000.
2. Not Sweet
Now look at growth of industrial capacity.
First you will notice, unless you're an economist or a hedge fund manager, that annual capacity growth increases averaged about 4.6% per year for 1997, 1998, 1999, 2000.
In 2001, capacity growth declines to 1.7 % above the 2000 mark.
In 2002, capacity growth declines to 1.1 % above the 2001 mark.
In 2003, capacity growth remains at 1.1% above the 2002 mark.
In 2004, capacity growth "improves" to 1.6% above the 2003 level.
In 2005, capacity growth remains 1.6% above the 2004 level.
Now comes the uptick with increased capital investment.
In 2006, industrial capacity grows 2.4 percent.
In 2007, the capacity growth rate falls to 1.8 percent.
In 2008, FRB estimates are that industrial capacity growth slows again to 1.6 percent.
Rates of return on capacity investment had peaked in 2006, and once again were showing themselves to be more cost than benefit to profits.
All in all, output increases approximately 4.5% between 2000-2008, while capacity increases amount to approximately 13.5 percent.
These are the circumstances of overproduction that Marx described in Volume 3 of Capital:
Overproduction of capital never signifies anything else but overproduction of means of production-- means of production and necessities of life--which may serve as capital, that is serve for the exploitation of labor at a given degree of exploitation; for a fall in the intensity of exploitation below a certain point calls forth disturbances and stagnations in the process of capitalist production, crises, the destruction of capital...
Marx continues:
...there is periodically a production of too many means of production and the necessities of life to permit of their serving as means of exploitation of the laborers at a certain rate of profit...
...there follows swindle and a general promotion of swindle by frenzied attempts at new methods of production, new investments of capital, new adventures, for the sake of securing some shred of extra profit, which shall be independent of the general average and above it.
3. And Down Low
It certainly is not the case that the "real economy" was/is healthy and that the disturbances are the result of speculation, overextension of credit, fictitious capital, irrational exuberance, excess leverage, poor savings by consumers, etc. etc. The condition and terms of finance are determined by the condition of the real terms of production.
With output and investment so restrained by the bourgeoisie after the 2000-2003 period, finance's access to the revenue stream of industrial production through corporate lending, corporate bond underwriting, etc. was severely restricted.
If as Marx put it, overproduction is the overproduction of the means of production that cannot be deployed to exploit labor power at a required, sufficient, intensity, then finance capital's focus on the securitization of consumer debts, of mortgage payments, of student loans, represents the attempt to divert revenue away from wages, from the V component of capitalist production; to in effect, reduce wages.
Finance capital represents, not a vampire feeding on the body of so-called real capital, but the attempt to generate a sufficient intensity of exploitation of labor by means other than increased output and capacity growth. Financialization proves itself the most modern expression of the most primitive expropriation of surplus value by demanding and instigating the absolute reduction in the value of wage-labor.
S. Artesian
address all comments to: sartesian@earthlink.net
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