Re: Re: capitalism's expansion vs. limits
Speaking of which, Australians are hitting their credit cards ever harder, are paying interest rates that beggar belief, are no doubt partly seduced by desperate marketing but also obliged by necessity (which consideration never gets a mention in this connection), and are being further helped to discipline themselves by new cash advance fees (what is to rob a bank, compared to founding one, eh?). Anyway, just another datum for the doomwatch ... Cheers, Rob. Card cash advances hit $10b *Sunday Herald Sun* 24 June 01 OUR love affair with credit has reached new heights with $10 billion withdrawn last year in cash advances on credit cards. Credit card cash advances - despite interest rates of about 16 per cent - jumped 45 per cent in two years. Australians withdrew $809 million in cash advances on their cards in April, compared with $559 million in April 1998, according to latest Reserve Bank figures. In the year to April, $9.8 billion in cash was withdrawn on credit cards, up from $6.6 billion in 1998. The average cash advance was $263.82 - a sharp rise of almost 20 per cent in three years from $223 - while the average credit card purchase was $106.67. The rise in credit card advances reflected a recent surge in credit card spending - fuelled by frequent-flyer programs - and the familiarity and convenience of ATMs, the director of credit card information firm MWE consulting, Mr Mike Ebstein said. Consumer groups warn that a credit card cash advance is one of the most expensive ways to get cash and suggest EFTPOS withdrawals from their bank accounts instead, if these are an option. If you are getting a lot of cash advances out, it is costing you a lot of money and it is not in your best interests to manage your finances that way, Australian Consumers' Association finance policy officer, Ms Louise Petschler, said. ANZ last month imposed a 1.5 per cent fee on cash advances.
Re: RE: capitalism's expansion vs. limits
I referred to: that eternal chestnut, the we're running out of oil theory Mark Jones says: This 'eternal chestnut' dates back at least to Marx himself, to Liebig, Jevons and others who first talked about resource limits, including both fossil energy and soil fertility. Of course, Ricardo and Malthus were also quite conscious of the natural limits, before Marx or Liebig or Jevons. (Probably Aristotle was too, but I'm not enough of a scholar on that guy.) But it's a mistake to equate the existence of natural limits with running out of oil. The former says that there is something -- e.g., energy received by the Earth from the Sun -- which involves an absolute limit (an ultimately vertical supply curve). The latter says that demand is always going to be increasing faster than supply. It's a basic mistake to jump without reflection from the former to the latter. It's also a mistake to ignore Marx's writings on rent, in volume III of CAPITAL: there he talks about differential rent II and how capitalism encourages technical change which deadens the blow of natural scarcity. He rejects the Ricardian stationary state pretty explicitly in much of his later work. That's why he instead emphasize the _nature_ of the technical change (for him, the rising organic composition of capital) as encouraging economic crisis. The problem has hardly gone away. Another reputable scientist, the petrogeologist M King Hubbert warned as long ago as 1956 that US oil would start to run out in 1970. It did. Lower 48 oil production peaked that year and US production is now half what it was then. Hubbert also predicted that world oil would peak around the year 2000. That's for a specific geographical location (though which location you're talking about is ambiguous, since you jump from the US to the lower 48 states and it's unclear whether or not the second reference to the US includes Alaska or not). New supplies of oil seem to be found in new locations (outside the US) every year. Further, the amount of oil available depends not just on the natural limits on the amount of oil in the ground but also social and technical conditions of oil production. As prices rise (if the price rise is seen as being a permanent rather than a transitory thing), the development of new technologies is encouraged to allow for the pumping of oil from old fields that have been abandoned. When oil prices are high, they even pump oil from the fields near my home (though the place will become a park in a few years). Of course, the supply of oil can also be boosted if we lower ecological standards, which is of course the Cheney-Bush goal. BTW, what does the petrogeological profession as a whole think of Hubbert? what is the professional consensus on his methods and conclusions? why should we believe him rather than others? or is he reputable the way Milton Friedman is? My amateur understanding is that most of the predictions about the limits on the supply of oil (like the ones that show up in SCIENTIFIC AMERICAN every year or two) have turned out to be too pessimistic practice. Is that the opinion of the petrogeologists, too? Or are they all pointing to absolute limits on the supply of oil that will bind the system causing the kind of crisis you predict? Certainly world energy per capita already has peaked. How did we get from oil to energy? In any case, peaked relative to what period of time? For example, in real terms, gasoline prices seem to have peaked in the US, but they're lower than they were 20 years ago. Whether or not it's a peak depends on your frame of reference. Further, world energy use could be peaking because people are figuring out how to use energy more efficiently. Look at California, where we've been increasingly efficient at using energy (but got punished by the energy monopolies for our efforts -- no good deed goes unpunished). Some argue that world oil has now peaked. If Hubbert is right, the decline will mean that oil and gas will fall by half in the next 50 years. But given what you said above, Hubbert was talking about the US, not the world. That will mean the end of capitalist economy, pace some as yet unknown act of final ingenuity. Wow! I'm sorry if your bald assertion has driven me to make a Brad-like response: I can more easily accept the idea that we're running out of oil than I can accept the assertion that higher oil prices (or more non-price rationing) will drive capitalism away. Why can't the cappos get the proles to pay for it? It is common to say that the streets of major cities were full of horse shit, but hey! the automobile came along. The automobile, however, was already invented. Anything which you rely onto to overcome a major crisis must already exist on someone's drawing board. But there is no evidence at all of any single technology or complex of technologies capable of subtituting for the myriad energy and feedstock uses of petroleum. On
Re: Re: RE: capitalism's expansion vs. limits
Jim Devine wrote: BTW, what does the petrogeological profession as a whole think of Hubbert? what is the professional consensus on his methods and conclusions? why should we believe him rather than others? or is he reputable the way Milton Friedman is? When Mark started going on about the disappearance of oil a few years ago, I called around to a bunch of industry savants, and had several on the radio. Mark's opnion is definitely a minority one - which doesn't make it wrong, of course. But he doesn't often acknowledge this. A guy from the Petroleum Finance Corp. agreed with me when I suggested the real danger was that we'd choke ourselves if we burned all the oil we have, rather than it running out disastrously soon. Doug
Re: Re: Re: RE: capitalism's expansion vs. limits
Doug is probably correct that the threat of choking on oil is an impending danger, but the oil is getting harder and harder to get. The low hanging fruit is gone. The oil that is now being drilled in the Gulf of Mexico is deep at the bottom of the sea. No one knows what will happen if a serious accident occurs there. The oceans, in addition, are being pushed to their environmental limits -- think of the fishing industry in decline. I would love to believe that ingenuity will rescue us. We have seen many surprising technological innovations, but often they too come at a cost. For example, the water in Silicon Valley is seriously poisoned from the solvents that the industry uses. Mark may be wrong that oil will be the ultimate constraint. I suspect water will come first -- although our economy wastes an enormous amount, which gives us some wiggle room. In other parts of the world, the people are note so fortunate. Doug wrote: When Mark started going on about the disappearance of oil a few years ago, I called around to a bunch of industry savants, and had several on the radio. Mark's opnion is definitely a minority one - which doesn't make it wrong, of course. But he doesn't often acknowledge this. A guy from the Petroleum Finance Corp. agreed with me when I suggested the real danger was that we'd choke ourselves if we burned all the oil we have, rather than it running out disastrously soon. Doug -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
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Michael: Mark may be wrong that oil will be the ultimate constraint. I suspect water will come first -- although our economy wastes an enormous amount, which gives us some wiggle room. In other parts of the world, the people are note so fortunate. Actually, it probably makes sense not to use a verb tense like will come when referring to water. Our Tom Kruse was on the front lines of a struggle over water in Bolivia, while Palestine and South Africa are confronting sharp struggles over this issue *right now*. While there might be technical substitutes for oil--at least in theory--there is none for water. Bill Moyers had a very good show on PBS the other night that explored many of these issues. In South Africa they are hiring people from places like Soweto to cut down Eucalyptus trees near rivers and streams. These are not only not native to the country, they suck up water just like the more familiar weeping willow tree in the USA. Despite such measures, there are enormous capitalist pressures to waste water even more than is the case today. For example, a steer requires TWENTY GALLONS of water each day. And, along with automobiles and entertainment, Macdonalds and Burger King serve as the storm troops of neoliberalism. One of Moyer's interviewees made the point that if this process does not come to an end, the world will look like Haiti before the end of the century. This I fear is the way that capitalism is moving, not so much toward cataclysm but desperate inequality where the apologists for the system, both on the left and the right, live inside walled communities with air conditioning and 3 square meals a day. Louis Proyect Marxism mailing list: http://www.marxmail.org/
Re: Re: capitalism's expansion vs. limits
Date: Fri, 22 Jun 2001 18:19:57 -0700 From: Jim Devine [EMAIL PROTECTED] Unfortunately for Marx, his volume III theory of the rising organic composition of capital doesn't work very well on either a theoretical or a practical level. Not only can the capitalists compensate for any rise in the organic composition of capital by cutting wages relative to productivity (raising the rate of surplus-value), Patrick wrote: Jim, there are always countervailing tendencies (absolute/relative s.v. extraction), of which I think the most important since the current int'l slowdown in accumulation began three decades or so ago, has been the temporal/spatial *displacement* of the devalorisation of overaccumuled capital. Third World lending has been one vehicle (even if not, in the whole scheme of things, a particularly large one in volume terms... but we've really felt it down here!). right. -- all of the stuff below also basically involves agreement with Patrick's position. Consider, for instance, the Suter/Eichengreen studies of financial crashes: every 50 years like clockwork since 1820s, involving 1/3 of all nation-states (the WB's 2000 Global Finance report actually promotes the financial-Kwave theory, I guess because Stiglitz still had his hand in and Eichengreen refused to draw the logical conclusions). It seems that the big difference during the 1980s was the concentrated power of the WB/IMF--as cops for NY/London/Frankfurt banks--to NOT ALLOW the devalorisation of financial capital by instead rescheduling debt (Nyerere and Castro failed to get the debtors' cartel up and running). But the point here is that this process of displacing the overaccumulation crisis South didn't solve it. Racing to repay unpayable debt, the Third World glutted most raw material and light mfg. markets. So the displacement -- the recent spatio-temporal countervailing tendencies Marx did not really foresee or theorise -- simply means that the overaccumulation problem grows worse, right? it's true that spatio-temporal displacement doesn't solve the problem -- so that it makes crisis tendencies worse, since imbalances continue to accumulate. But my point was only that Marx's theory wasn't very good. I'm not going to get into all that argument here, but I agree with the literature's almost-consensus. That does not mean that I reject the capitalist tendency toward crisis, though, as I noted in my original message. My point is that the capitalist tendency toward crises causes repeated crises rather than automatic breakdown. but any crisis that occurs purges imbalances from the system, destroying capital and allowing accumulation to recover -- to drive itself into crisis once again. A matter of the balance of class forces, right? Including territorial struggles? So, that's why helping to more surgically identify the pockets of resistance and empower them--instead of comrade Chris' utopian global-regulatory strategy--becomes ever more crucial. To link the pockets of resistance obviously also calls for the need for solidarity--the globalisation of people (not of capital or state functions, which will overwhelm us if they maintain their current international capacities, without nation-states reigning in capital, e.g., through a new round of exchange controls). right. Even this doesn't inevitably lead to capitalism's demise. Instead, it encourages collective solutions, i.e., the monopolization of markets and the rise in the role of the state. The last time capitalism had a gigantic Crisis -- the 1930s -- it encouraged the rise of state solutions, from social democracy to fascism, with the U.S. New Deal in the middle, on a national level. The next Crisis will likely see its solution on the global level, as seen in embryonic form in the Kyoto accords. (Somehow, the Bushwackers aren't anti-abortion on _this_ issue.) If the current US slowdown turns into a global depression, it encourages further development of collective control, perhaps the creation of a global Fed. Human ingenuity would show up in the form of a New Bretton Woods conference, a global-statist version of social democracy or fascism or something in-between. This eventually would allow the re-establishment of capitalist accumulation Why are you so sure, comrade Jim, about global solutions (restructuring of relations of production)? The old familiar intercapitalist-competition plus bloc-formation process plus geo-military conflict seems just as likely, doesn't it? I'm not sure. The capitalists unite to solve problems (as when the elites united circa 1945 to form NATO, Bretton Woods, etc.) But you're right that competition re-asserts itself. Where I had an ellipsis, I originally said something about the eventual rise of neo-neo-liberalism, which will come (roughly) 25 years after the new global collective solution and roughly 25 years before the next global collective solution. I elided this
Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Michael Perelman wrote: Doug is probably correct that the threat of choking on oil is an impending danger, but the oil is getting harder and harder to get. The low hanging fruit is gone. The oil that is now being drilled in the Gulf of Mexico is deep at the bottom of the sea. No one knows what will happen if a serious accident occurs there. The oceans, in addition, are being pushed to their environmental limits -- think of the fishing industry in decline. isn't the ladder for getting the fruit -- the technology for extracting oil -- getting taller, too? I totally agree that there's a lot of environmental impact: that's why I put the emphasis on the role of external costs (i.e., on capitalist society's failure to produce distribute consume at the lowest possible social cost) rather than absolute natural scarcity. The same goes for water, where the biggest problem is pollution. BTW, here's a poem (received via the internet) for all my friends on pen-l: Are you tired of all those mushy friendship poems that always sound good but never actually come close to reality? Well, here is a friendship poem that really speaks to true friendship and truth itself! Friend, When you are sad, ... I will get you drunk and help you plot revenge against the sorry bastard who made you sad. When you are blue, ... I'll try to dislodge whatever is choking you. When you smile, ... I'll know you finally got laid. When you are scared, ... I will rag you about it every chance I get. When you are worried, ... I will tell you horrible tales about how much worse it could be and to quit whining. When you are confused, ... I will use little words to explain it to your dumb ass. When you are sick, ...stay away from me until you're well again. I don't want whatever you have. When you fall, ... I will point and laugh at your clumsy ass. This is my oath, ...I pledge 'til the end. Why you may ask? Because you're my friend! If you send this poem to any of your closest friends, get depressed because you'll realize you only have 2 friends, and one of them is not speaking to you right now anyway. Remember: A friend will help you move. A good friend will help you move the body [The above message evoked Eudora's flame-alert, warning that I might get my keyboard washed out with soap. I decided not to tone it down, since all the objections came due to the poem.] Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~JDevine
Re: Re: capitalism's expansion vs. limits
Chris B writes: I do not know if Jim is saying that Marx explicitly argued in Volume III that the rising organic composition of capital led to an automatic (and permanent) break down. A reference would be important if Jim is saying Marx really did this, as opposed to arguing extensively from one side of a dialectical analysis which must be placed in the context of all of his writings. as far as I know, Marx never said that the rising composition led to breakdown (automatic collapse). However, many attribute this to him. In any event, it's not even a very good theory of (more limited) crisis, IMHO. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~JDevine
RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population.
Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Well said. The question then is do these contradictions reinforce each other or do they cancel each other out? On Sat, Jun 23, 2001 at 10:57:39PM -0500, Forstater, Mathew wrote: Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
RE: Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
2 definitely can be the basis for problems with 1. and 2 also does nothing without also having 1, because you can't push on a string. none of it matters if we have problems with 4, and many policies to address 1 will exacerbate 4 (mindless growth uses up more resources and creates more pollution, etc.). ditto then that if addressing 2 is a way to grease the way for 1, 4 is exacerbated. policies to address 1 can also exacerbate 3, because one of the ways that economies deal with 3 is to have excess capacity and unemployment. 1 and 3 can be linked in other ways--if technical innovations shift income distribution away from workers to capitalists, consumption demand can fall. -Original Message- From: Michael Perelman [mailto:[EMAIL PROTECTED]] Sent: Saturday, June 23, 2001 11:28 PM To: [EMAIL PROTECTED] Subject: [PEN-L:13892] Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits Well said. The question then is do these contradictions reinforce each other or do they cancel each other out? On Sat, Jun 23, 2001 at 10:57:39PM -0500, Forstater, Mathew wrote: Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
