The Hypocrisy of NATO's Illegal War On Iran - Part 2

The introduction of national laws and rules, by the capitalist ruling-class, which created a “level playing field”, like all bourgeois right, is, as Marx describes it in The Critique of The Gotha Programme, a right not to equality, but inequality.

“But one man is superior to another physically, or mentally, and supplies more labour in the same time, or can labour for a longer time; and labour, to serve as a measure, must be defined by its duration or intensity, otherwise it ceases to be a standard of measurement. This equal right is an unequal right for unequal labour. It recognizes no class differences, because everyone is only a worker like everyone else; but it tacitly recognizes unequal individual endowment, and thus productive capacity, as a natural privilege. It is, therefore, a right of inequality, in its content, like every right. Right, by its very nature, can consist only in the application of an equal standard; but unequal individuals (and they would not be different individuals if they were not unequal) are measurable only by an equal standard insofar as they are brought under an equal point of view, are taken from one definite side only – for instance, in the present case, are regarded only as workers and nothing more is seen in them, everything else being ignored. Further, one worker is married, another is not; one has more children than another, and so on and so forth. Thus, with an equal performance of labour, and hence an equal in the social consumption fund, one will in fact receive more than another, one will be richer than another, and so on. To avoid all these defects, right, instead of being equal, would have to be unequal.”

Marx is not even talking about the conditions existing under commodity production, or capitalist production, here, but about the conditions that would exist under socialism, in its initial phases. It is the critique of the fundamental flaw in the concept of meritocracy, which, inevitably entrenches the existing natural abilities of some as against others. Under capitalism, there is no material basis for society seeking to go beyond this “equality of right”, which inevitably means an inequality of outcomes, given the actual “inequality of being”. It is the fundamental flaw of welfarism, which purveys the idea that such “equality of outcome”, or, at least, a mollification of inequality can be achieved, by a complex, inefficient, bureaucratic and costly system of taxes and benefits, itself requiring huge numbers of people involved in its administration, who could have been more usefully employed.

And, this is true in terms of imperialism too. The developed, capitalist economies, with their existing masses of fixed capital, let alone their more advanced technology, produce commodities whose individual value is much lower than that of the same commodities produced by less advanced capitalist countries, that have less fixed capital, and less advanced technology. But, in the world market, as in every market, commodities are sold not at their individual value, but at their market value (if we ignore the question of prices of production), as Marx sets out in Capital I and III. The large, monopoly-capitalist (imperialist) producers, can always sell their commodities at lower prices, and so undercut their smaller competitors.

The large, monopoly-capitalist (imperialist) producers, thereby, obtain surplus profits (rents), even though they often sell their commodities at prices slightly below that of their smaller competitors, and despite the fact that they can, as Engels described above, and as Marx set out in Capital I, pay their workers much higher wages, and provide them with better conditions. Marx noted that European textile workers, were paid wages only half that of English textile workers, and yet English textile production persistently undercut the European producers, and provided higher profits for English producers.

Demanding that less developed economies abide by the same rules and regulations and standards as the advanced capitalist economies, within the confines of a continuation of global capitalism, is as utopian as the welfarist demands for equal outcomes, for unequal individuals. It is simply a manifestation of that petty-bourgeois, social-democratic, managerialist ideology that the interests of capital and labour are the same, and require only a negotiation as to the process of distribution. It imposes the false concept of the idea of “the people”, as though the entire historical process of the differentiation of that “people”, into “bourgeois” and “proletarians”, that took place at an accelerating pace, from the 15th century onwards, had never occurred.

Back To Part 1

Anti-Duhring, Part II, Political Economy, X – From The Critical History - Part 28

So now, to return to Engels' exposition.

“The first premise of the Tableau is that the farming system and with it large-scale agriculture as understood in Quesnay’s time, had been generally introduced, Normandy, Picardy, Île-de-France and a few other French provinces serving as prototypes. The farmer therefore appears as the real leader in agriculture, representing the whole productive (agricultural) class in the Tableau and paying the landlord a rent in money.” (p 314)

In other words, we have capitalist production, in agriculture. The social function of the landlord, in organising agricultural production, has ceased, and the landlords, now, simply receive capitalist ground-rent from the farmer, in the same way that, today, the social function of the private capitalist has ended, and the ruling-class of shareholders (owners of fictitious-capital) simply receive their revenues in the form of interest/dividends.

“An invested capital or inventory of ten milliard livres is assigned to the farmers as a whole; of this sum, one-fifth, or two milliards, is the working capital which has to be replaced every year—this figure too was estimated on the basis of the best-managed farms in the above provinces.” (p 314-5)

The “working-capital” is what Marx refers to, elsewhere, as circulating-capital. It is what is required for wages (variable-capital), raw materials, auxiliary materials (circulating constant capital) , and to cover the wear and tear of fixed capital. Because the physiocrats lump together the capitalist farmer with the agricultural labourers – as the productive class – they make no distinction between wages and profit in agriculture.

“Further premises: (1) that for the sake of simplicity constant prices and simple reproduction prevail; (2) that all circulation which takes place solely within one class is excluded, and that only circulation between class and class is taken into account; (3) that all purchases and sales taking place between class and class in the course of the industrial year are combined in a single total sum. Lastly, it must be borne in mind that in Quesnay’s time the home industry of the peasant family itself provided by far the greater portion of its needs other than food in France, as more or less in all Europe, and that it is therefore taken for granted here as accessory to agriculture.” (p 315)

The premise of constant prices simply removes the distraction of changes in productivity, which might lead to the previously discussed issues of tie-up or release of capital. It also removes the distraction of inflation, i.e. changes in the standard of prices. The premise of exchanges only between classes is, also, a simplifying assumption, were it not for the fact that the Physiocrats lump together the capitalists and labourers into the “productive” and “sterile” classes. In doing so, they fail to recognise the actual basis of the creation of surplus-value, in both these “classes”, as the surplus labour performed, and its appropriation by the capitalists.

The assumption of a single annual exchange between the classes is a simplifying assumption, and, in Marx's analysis in Capital and Theories of Surplus Value, he sets out the effects of breaking this down into multiple exchanges, during the year, on the circulation of money and capital. Marx' and Engels' analysis of the rate of turnover of capital is an extension of that.

The description of cottage industry as accessory to agriculture, indicates the extent to which industrial production of commodities was the preserve of the towns, and the “sterile class”, and provided means of production, and items of consumption, for the exploiting classes.

Its also notable, given the earlier discussion, that, in the Tableau, Quesnay's starting point is the total harvest, and is described as “total reproduction”, a phrase emphasised, here, also, by Engels. It is the basis of Marx's determination of value as “current reproduction cost”, and of his schemas of reproduction, in which what is reproduced is not money-values, but the physical elements of capital, i.e. the use-values.

Back To Part 27

SNNS 33

 

Anti-Duhring, Part II, Political Economy, X – From The Critical History - Part 27

Elsewhere, I have set out the way in which a rise in productivity results in a release of capital. In other words, the opposite condition applies to that set out above. Higher productivity results in a fall in unit values, i.e. more use-values are produced by a given amount of labour, so that each unit contains less labour/value. That lower unit value, means that each unit of output has a lower value than the unit value/historic cost of the same use-values used in production, as inputs. Looked at in the same context as that set out above, as a snapshot, this seems to result in a reduction in the mass of profit, and fall in the rate of profit, just as, in the case of a crop failure, the reverse seems to be true. But, again, that is an illusion caused by a focus on money values/prices.

A rise in productivity, resulting in lower unit values, gives the appearance, if only a single year is considered, of reducing profit, but represents only a capital loss – the most obvious example of that is Marx's analysis of moral depreciation. But, on the basis of continuing production, this rise in productivity, and fall in unit values, means that a smaller portion of total output is required to replace the consumed constant and variable capital. It produces a release of capital. Although this release of capital manifests as an increase in profit, it is again, an illusion. But, the fact that it also reduces the value of labour-power means that it does raise the rate of surplus value, and so does raise the mass of profit. Moreover, any given mass of profit, now, represents a higher rate of profit, because the value of c and v are reduced, so that s/(c +v) rises. This is what happened in the 1980's and 90's.

The Physiocrats made the same mistake of failing to distinguish between labour and labour-power that continues in the work of Smith, and is found in the work of Proudhon. It manifests differently, because the Physiocrats were concerned with use-values, whereas Smith was concerned with values – though, as Marx sets out in Theories of Surplus Value, Smith, also, slips back into Physiocracy in places. The Physiocrats argued, as set out above, that 1,000 tons of corn is used as seed (constant capital), 1,000 tons as wages (variable-capital), but 3,000 tons is the output, with the 1,000 tons surplus mystically arising from the land, providing the basis for the owner of the land to obtain rent.

But, as set out earlier, this assumes that the 1,000 tons of corn paid as wages, which is equal to a value of 1,000 hours of labour, or £10,000, is the same as the new value created by that labour. It isn't. The value of labour-power, the use-value of being able to perform labour, is equal to the value of the 1,000 tons of corn required to reproduce that labour-power, i.e. is equal to 1,000 hours of labour. The workers, however, perform not this 1,000 hours required to reproduce their labour-power, but 2,000 hours, 1,000 hours of surplus labour, manifest in the surplus product of 1,000 tons of corn.

Suppose we go back to an initial condition where, as noted earlier, Nature provides its gifts freely. In other words, we have Nature, by its own evolutionary processes creating corn. Early humans are able to consume this corn, just as cows consume grass in a field, as a use-value, gratis. It has no value, no labour has been expended on its production. Value is just the label, the scientific term we give to this labour required to take the free gifts of Nature, and to enhance them, by transforming them in some way. It may be, for example, taking the seeds from plants, and, instead of relying on Nature to cast them, haphazardly, we plant them in dedicated areas, and tend them so as to raise the output.

In this case, we start with seed corn that has no value, no labour has been spent on it. To use the terms applicable to capitalist production c = 0. But, the first farmers must collect the seed, they must create seed drills into which they plant the seeds, and they must cultivate the seed, watering it and so on. This is labour over and above what is required simply to consume, i.e. to reproduce their labour-power (necessary labour).  If they collect a ton of seed, which, left to Nature, would have produced 2 tons of corn, and, by cultivating it, they may obtain 10 tons of corn. That represents an improvement in their real wealth of 500%.

Back To Part 26

Forward To Part 28

The Hypocrisy of NATO's Illegal War On Iran - Part 1

Even the miserable, western bourgeois media have been led to discuss the fact that US imperialism, and, thereby, NATO, which is its military instrument, its global body of armed men, which has sought to exercise a monopoly of violence, has engaged in an illegal war against Iran.

In reality, its not the fact that its war against Iran is “illegal”, that concerns dominant sections of the ruling-class, whose concerns are being voiced by sections of the media, but that, like many other aspects of the actions of the Trump regime, they are unthought out, haphazard, and counter-productive. Trump's regime is a mafia regime, focused on the personal enrichment of the Trumpf gang.

Its not that western imperialism is horrified at the fact that US imperialism has engaged in an illegal war against Iran, and is dragging the rest of NATO into it, because NATO has repeatedly engaged in illegal wars, infringing “international law”, whatever that is supposed to be. International law, like national law, is simply a codification of the objective rules required to ensure the interests of the ruling-class. The state acts as the “executive committee” of that ruling-class, establishing a system of laws and rules that advance and defend the interests of that class, even at the expense of individual members of it.

It establishes a “level playing field”, but, of necessity, that level playing field protects the interests of those best able to take advantage of it. As Engels put it,

“Thus the truck system was suppressed, the Ten Hours’ Bill was enacted, and a number of other secondary reforms introduced — much against the spirit of Free Trade and unbridled competition, but quite as much in favour of the giant-capitalist in his competition with his less favoured brother. Moreover, the larger the concern, and with it the number of hands, the greater the loss and inconvenience caused by every conflict between master and men; and thus a new spirit came over the masters, especially the large ones, which taught them to avoid unnecessary squabbles, to acquiesce in the existence and power of Trades’ Unions, and finally even to discover in strikes — at opportune times — a powerful means to serve their own ends. The largest manufacturers, formerly the leaders of the war against the working-class, were now the foremost to preach peace and harmony. And for a very good reason. The fact is that all these concessions to justice and philanthropy were nothing else but means to accelerate the concentration of capital in the hands of the few, for whom the niggardly extra extortions of former years had lost all importance and had become actual nuisances; and to crush all the quicker and all the safer their smaller competitors, who could not make both ends meet without such perquisites. Thus the development of production on the basis of the capitalistic system has of itself sufficed — at least in the leading industries, for in the more unimportant branches this is far from being the case — to do away with all those minor grievances which aggravated the workman’s fate during its earlier stages.”

(Preface to the English Edition of The Condition of the Working Class in England)

A level playing field, establishing laws of conduct, in place of a free for all, chaos and arbitrariness, including, therefore, rules, regulation, minimum standards, and even planning, which the largest capitals had, already, had to adopt for their own effective operation, was wholly in the interests of those large capitals, and acted to disadvantage the smaller less efficient capitals, let alone the petty-bourgeois and peasant producers. Was that a “bad” thing, as the likes of the petty-bourgeois socialists such as Sismondi or Proudhon, argued, or as today's “anti-capitalists” argue? Morally, if you look at the immediate effect on that large mass of those small producers, certainly, a case could be made for saying that it was “bad”, but, as Marx, Engels, Lenin and Trotsky set out, this petty-bourgeois moralism ends up being not just utopian, but is also reactionary.

Utopian, because the very same material conditions, and social and historical laws that led to the competition of independent, small commodity producers, becoming increasingly differentiated into larger and smaller producers – what in other contexts is seen as a process of self-organisation, in other words, it is not consciously organised, but arises spontaneously behind their backs, as a result of these unconscious processes and historical laws – are also the same laws that lead to the larger commodity producers becoming capitalist producers, and, then, those capitalist producers being divided into the large, dominant capitalist producers, and the small capitalist producers and petty-bourgeoisie, subordinated to, and ultimately dependent upon the large capitals. As Lenin put it, quoting Hilferding approvingly,

““It is not the business of the proletariat,” writes Hilferding “to contrast the more progressive capitalist policy with that of the now bygone era of free trade and of hostility towards the state. The reply of the proletariat to the economic policy of finance capital, to imperialism, cannot be free trade, but socialism. The aim of proletarian policy cannot today be the ideal of restoring free competition—which has now become a reactionary ideal—but the complete elimination of competition by the abolition of capitalism.””

(Lenin - Imperialism, The Highest Stage of Capitalism)

Forward To Part 2

Anti-Duhring, Part II, Political Economy, X – From The Critical History - Part 26

Elsewhere, I have set out the way in which a rise in productivity results in a release of capital. In other words, the opposite condition applies to that set out above. Higher productivity results in a fall in unit values, i.e. more use-values are produced by a given amount of labour, so that each unit contains less labour/value. That lower unit value, means that each unit of output has a lower value than the unit value/historic cost of the same use-values used in production, as inputs. Looked at in the same context as that set out above, as a snapshot, this seems to result in a reduction in the mass of profit, and fall in the rate of profit, just as, in the case of a crop failure, the reverse seems to be true. But, again, that is an illusion caused by a focus on money values/prices.

A rise in productivity, resulting in lower unit values, gives the appearance, if only a single year is considered, of reducing profit, but represents only a capital loss – the most obvious example of that is Marx's analysis of moral depreciation. But, on the basis of continuing production, this rise in productivity, and fall in unit values, means that a smaller portion of total output is required to replace the consumed constant and variable capital. It produces a release of capital. Although this release of capital manifests as an increase in profit, it is again, an illusion. But, the fact that it also reduces the value of labour-power means that it does raise the rate of surplus value, and so does raise the mass of profit. Moreover, any given mass of profit, now, represents a higher rate of profit, because the value of c and v are reduced, so that s/(c +v) rises. This is what happened in the 1980's and 90's.

The Physiocrats made the same mistake of failing to distinguish between labour and labour-power that continues in the work of Smith, and is found in the work of Proudhon. It manifests differently, because the Physiocrats were concerned with use-values, whereas Smith was concerned with values – though, as Marx sets out in Theories of Surplus Value, Smith, also, slips back into Physiocracy in places. The Physiocrats argued, as set out above, that 1,000 tons of corn is used as seed (constant capital), 1,000 tons as wages (variable-capital), but 3,000 tons is the output, with the 1,000 tons surplus mystically arising from the land, providing the basis for he owner of the land to obtain rent.

But, as set out earlier, this assumes that the 1,000 tons of corn paid as wages, which is equal to a value of 1,000 hours of labour, or £10,000, is the same as the new value created by that labour. It isn't. The value of labour-power, the use-value of being able to perform labour, is equal to the value of the 1,000 tons of corn required to reproduce that labour-power, i.e. is equal to 1,000 hours of labour. The workers, however, perform not this 1,000 hours required to reproduce their labour-power, but 2,000 hours, 1,000 hours of surplus labour, manifest in the surplus product of 1,000 tons of corn.

Suppose we go back to an initial condition where, as noted earlier, Nature provides its gifts freely. In other words, we have nature, by its own evolutionary processes creating corn. Early humans are able to consume this corn, just as cows consume grass in a field, as a use-value, gratis. It has no value, no labour has been expended on its production. Value is just the label, the scientific term we give to this labour required to take the free gifts of Nature, and to enhance them, by transforming them in some way. It may be, for example, taking the seeds from plants, and, instead of relying on Nature to cast them, haphazardly, we plant them in dedicated areas, and tend them so as to raise the output.

In this case, we start with seed corn that has no value, no labour has been spent on it. To use the terms applicable to capitalist production c = 0. But, the first farmers must collect the seed, they must create seed drills into which they plant the seeds, and they must cultivate the seed, watering it and so on. If they collect a ton of seed, which, left to Nature, would have produced 2 tons of corn, by cultivating it, they may obtain 10 tons of corn. That represents an improvement in their real wealth of 500%.

Back To Part 25

Forward To Part 27

Anti-Duhring, Part II, Political Economy, X – From The Critical History - Part 25

The greater the amount of surplus labour/value, the greater the potential to a) expand population, and b) to expand the scale of production itself. If we consider, as Marx does, that profit is a historically limited form of this surplus value, then, profit cannot be greater than this surplus-value. It can be less, because, as Marx sets out in Capital III, the surplus value, having been produced, must be realised by the sale of commodities, and that is not guaranteed, but, even if they are sold, at their value, there are lots of costs involved in their circulation, and these costs all represent a deduction from the produced surplus value/profit.

But, then, we can see why this posed a problem for Ramsay, because, if profit equals surplus value, then, a rise in the price of corn, relative to the historic price paid for the seed – corn – appears to produce profit higher than the produced surplus-value. The surplus-value, in the example, was equal to £10,000 (10,000 tons). But, now, if the price of corn rises to £12 per ton, the 3,000 tons sells for £36,000, whilst its cost of production was still only equal to £20,000, a surplus-value of £10,000 now seems to be at odds with a “profit” of £16,000. Ramsay concluded that this additional £6,000 of profit was, thereby, attributable to the constant capital itself.

But, what is the reality? Firstly, as set out earlier, this additional £6,000 of profit is an illusion, and is really just a one-off capital gain. To continue production on the same scale, the farmer, or someone who buys the farm from them, must, now, use £12,000 of the proceeds of the sale of corn, just to replace the seed, whereas, before, it only cost £10,000. Secondly, in this example, wages are equated with corn, as though this is all the workers consume. So, to replace the variable-capital (1,000 tons of corn) the farmer must hand over the same 1,000 tons, but which, also, now, represents a value of £12,000, and not £10,000, as before. Finally, the farmer appropriates the remaining £12,000, but this only enables them to consume the same 1,000 tons of corn as before.

In effect, as I will show, its just money-illusion, with a 20% inflation. If they previously devoted half of their profit to capital accumulation (£2,500 to seed, £2,500 to labour-power), to do so, now, costs them £3,000 for seed and £3,000 for labour-power/wages. But, even this is not the full story.

In this scenario, there are only two commodities, corn and labour-power. If the value/price of corn has risen by 20%, this can only be because productivity has fallen, for example due to a poor harvest, (or else the value of money/or the standard of prices has fallen). In other words, output can no longer be 3,000 tons of corn. In place of money prices, it is best seen by using values, i.e. labour hours. 

Assume that, initially, 1,000 tons of corn is equal to 1,000 hours of labour. In terms of values, then, we had 1,000 c + 1,000 v + 1,000 s. But, as a result of this poor harvest, and fall in productivity, the 1,000 hours of labour contained in the seed, plus the 2,000 hours of new labour performed to turn it into corn, no longer produces 3,000 tons of corn, but something less. For the unit value of corn to rise from £10 per ton to £12 per ton, the 3,000 hours of labour, represented by total output, must result in output of only 2500 tons, equal to £30,000. The unit value rises from 1 hour per ton to 1.2 hours per ton.

So, as Marx sets out, in Theories of Surplus Value, Chapter 22, although the unit price has risen by 20%, output falls by 16% (1/6). But, Marx notes, the farmer must still replace the consumed 1,000 tons of seed, and the 1,000 tones of corn that forms the variable capital, with these same physical quantities. Capital, as Marx notes, is a social relation, and that social relation only expands as a result of more labour being exploited. Consequently, the surplus product is reduced from 1,000 tons to just 500 tons. Previously, the surplus product represented a third of total output, and a half of the cost of production. Now, it represents only a fifth of total output, and a quarter of the cost of production.

Put another way, the 1,000 tons of surplus product could increase the size of the capital by 50%, whereas, now, it can expand by only 25%. What appeared, superficially, as an increase in the amount of profit, and rise in the rate of profit, measured against the historic cost of production, turns out to be an illusion, and the opposite. The additional money “profit” was simply a capital gain resulting from the rise in the unit value/price of corn. That same rise in unit value/price, resulting from a fall in productivity, actually causes a greater proportion of total output to be needed to reproduce the consumed constant and variable-capital. So, in reality, the mass of profit falls, because the rate of surplus-value falls. Previously, £10,000 advanced as wages produced £20,000 of new value, and so, £10,000 of surplus-value. But, now, the same 1,000 tons of corn (wages) has a value of £12,000. Previously, it represented 1,000 hours of labour, and now represents 1200 hours.

The labour still produces 2000 hours of new value, equal to £20,000, but, now, 1200 hours constitute necessary labour, and only 800 hours surplus labour. The rate of surplus value falls from 100% to 66.6%, and the mass of surplus value from £10,000 to £8,000. But, as Marx sets out, even if we disregard this fall in the rate of surplus value, and consequent reduction in the mass of surplus value, the rate of profit would still fall. Previously, surplus value represented 100% of the value of constant capital (seed). But, even assuming it remained at 1000 hours (£10,000) the seed, now, has a value of £12,000, so that the profit represents only 5/6 of its value.

Back To Part 24

Forward To Part 26