Charles wrote:
>On the contradictory or dialectical unity of overproduction and the law of
>the tendency of the rate of profit to fall, Rudy Fichtenbaum ( who has
>posted to this list) says in "Did Marx Have a Theory of the Business
>Cycle" ( Nature, Society and Thought Vol. 1, No. 2 1988):
>
>"A dialectical view which takes in to account Marx's fundamental method of
>research shows that as unified consistent theory of the business cycle is
>contained in Marx's writings. Cyclical crises, according to Marx, were
>reflections fo the fundamental contradiction of capitalism resulting in
>the law of the tendency of the rate of profit to fall. However, this does
>not in any way contradict the fact that these crises are also crises of
>overproduction resulting from the inability to realize the goods which
>have been produced. Rather, business cycles express the dialectical
>relationship between "the law as such" and "counteracting tendencies",
>which together give rise to the "internal contradictions of the law"
>expressing themselves as crises of overproduction."
The way I think of this is that the tendency for the rate of profit it fall
is basically a microeconomic theory of how capitalists have to keep on
striving to expand or else they'll lose out to their competitors. In many
cases, this causes a macroeconomic overaccumulation, which is sometimes --
in a "labor scarce economy" -- expressed as "overaccumulation relative to
supply," which looks a lot like Marx's classical theory of the falling rate
of profit. Something like this happened in the late 1960s/early 1970s in
the US, combined with wage squeezes on profits combined the rise in
international competition (cf. Brenner) that prevented the wage hikes from
being simply passed onto consumers. I had an unreadable article on this
subject published in the EASTERN ECONOMIC JOURNAL a long time ago.
>... On what you say following isn't it also true that the limited
>consuming power of society as a whole , limited to less than the total
>value of commodities produced, rooted in the fact that the fundamental
>facts of surplus value, in that the great mass of workers all produce
>more value ( surplus value) than they are paid in wages , of course? The
>capitalists who get the surplus value cannot or do not buy all especially
>the individual consumption commodities, they don't purchase the "surplus"
>commodities corresponding to the surplus value produced, so there is an
>inevitable realization problem lurking by the very operation of extraction
>of surplus value. This is an expression of the contradiction of social
>production and private appropriation. There's a better quote in Vol. III
>saying this , but I have lost track of it.
In "normal" times, the capitalists purchase the surplus commodities as
luxury consumption goods or investment goods or wasteful goods, so this
basic realization problem isn't realized (as it were). However, driven in
part by competition, they strive to raise the rate of surplus-value. (The
capitalists will disrupt even their own status quo.) If labor-market
conditions (including the state of working-class organization) allow this
hike to occur, then the capitalists have a harder and harder time filling
the gap, since increasing luxury and investment spending makes the economy
more unstable. This is overinvestment or overaccumulation relative to
consumption.
Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine
