Internationalist Perspective

A FEW REMARKS ON THE PRESENTATION OF `CONTROVERSES ON THE CRISIS

November 1, 2009 on 9:31 pm | In Uncategorized | No Comments

1. Compared to the analyses of the ICC, from which Controverses only recently split, this text is a clear step forward. No longer are we confronted with simple formulas; there is a real attempt to deepen that must be welcomed.

2. Still, and this is understandable since their separation is recent and they must still take stock of their experience, the bad influence of the ICC does not yet seem to be completely overcome. In the ICC, an article on the crisis is a repetition of formulae, with facts and figures selected to prove them. In Controverse’s text, the formulas are gone and what remains is only an empirical analysis. An analysis closer to Marx’s method, on the other hand, would be above all, historical, which is completely lacking in Controverse’s analysis. It would start from the fact that what occurs on the level of prices and profits, is different from, and determined by, what happens at the level of value. That, Controverses does not do either. The text speaks about profits and solvent markets, but never about `value’ or `surplus value’. Does Controverses assume that price = value and that profit = surplus-value? (They do, but only in their totalities). If Controverses distinguishes between them, we do not find any trace of it in this text.

3. This lack of a Marxist approach is shown in the interpretation of the graphs on which Controverses bases its conclusions. Already we can notice that Controverses uses the EU or the US as a stand-in for the worldwide economy. Furthermore, the lack of distinction between profit and surplus-value makes it appear as if all the profit of the US is generated inside the US. IP, on the other hand, shows that in the phase of the circulation of commodities, surplus-value is redistributed, and that it is thus necessary to integrate into the analysis an understanding of the way in which this distribution changes historically (see chapter on `metabolism’ in my recent text ‘Crisis of Value’). A large part of American capital is fictitious capital, however, its profits are quite real.

4. According to Controverses, the boom of the post-war period was terminated by a fall of the rate of profit, caused by a decline of productivity, (without explaining what caused the latter). The current crisis on the other hand, whose beginning it situates in1982, would be caused by a lack of markets, caused by the decline of demand of the working class whose purchasing power decreases because of the attack on wages, etc. According to Controverses, its graphs prove that. But we can interpret them very differently. Graph #3 does not necessarily show a fall of wages but a fall of the share of wages. It does not say a share of what but one can assume that it is a share of the BIP. Thus, that says that the cost of wages related to the total value of production is reduced. Does Controverses think that it would be better for capital that the cost of wages would be higher, because that would create more demand from the workers? From the point of view of capital, this additional consumption would be quite as unproductive as an increase of its own consumption. And it is the latter that it prefers. Thus graph #5, which shows a relative fall on behalf of consumption of the working class and a simultaneous increase in the total consumption of the US, shows, indeed, that the increase of ’solvent markets’ and the relative diminution of wages can occur at the same time.

5. The decline of the share of wages cannot be presented as a problem of reduction of the market in itself. If wages decrease relative to profit that means that the capitalist can consume even more. The problem is that this wage decline indicates that in future production less human labor will be employed and thus less surplus-value will be created. The problem of the markets and that of the tendency of the rate of profit to fall cannot be separated. We must see how they interact and for this we must see their common origin: the value-form, and the contradiction which results from this between exchange-value and use-value, abstract labor and concrete labor, capitalist wealth and real wealth, in the Marxist sense. We are completely in agreement with Controverses when it says that the current crisis is caused by an overabundance of capital but not when it says that it is divorced from the threat of the decline of the rate of profit. The overabundance of capital is only one problem because these capitals are not stable containers of value, because they must either valorize or devalorize. It is the decline of the creation of value that causes their devalorization. As Controverses affirms, it is the economic crisis which caused the financial crisis, not the reverse.

6. It is important to insist on the value-form as the cause of the crisis, because an analysis like Controverse’s which says that the cause of the crisis is a lack of demand on the part of the working class, is recuperable by the capitalist left. It is necessary to go to the root. If we speak about the economy, it is only because that gives us an opening to show the need and the possibility of a new world. But our analysis can only be this lever for consciousness if we can connect the bases of capitalist society to the contradictions which confront us today.

Sander