Like Ricardo, the author of the “Inquiry” notes the effect of machines on the workers. They note that the development of some machines may cheapen the price of necessaries, so that this facilitates that consumption by the workers, but machines that cheapen the price of luxuries do not benefit the workers. In fact, this argument is rather one-sided. Machines that cheapen wage goods facilitate workers' consumption, but may put workers producing those wage goods out of a job.
When the demand for a range of existing commodities comprise wage goods has reached a certain level, it may be difficult to raise it further, at market prices that produce a profit. At that point, capital needs to accumulate in alternative spheres of production, and to stimulate demand from workers for these new products. Only if the prices of these new products, formerly often luxuries, consumed by the few, can be sufficiently reduced, does it become possible for workers to consume them. What the author also notes, as did Ricardo, and Marx, is that where technological developments revolutionise production, and raise productivity, the consequence is a rise in the rate of surplus value, and frequently, a reduction in the value of labour-power, and often of constant capital. A given amount of surplus value buys more constant and variable-capital than it did previously, but also the mass of surplus value rises. The consequence is that although the immediate effect is to replace labour, and make it redundant, the longer-term effect is to increase surplus value, so as to facilitate greater accumulation, and to cheapen capital, so that more can be accumulated.
As Marx notes elsewhere, the beneficiaries of this further accumulation are not the workers themselves replaced by the technology, but their children and later generations. Marx notes,
“This Ricardian, following Ricardo’s example, recognises correctly crises resulting from sudden changes in the channels of trade. This was the case in England after the war of 1815. And consequently, whenever a crisis occurred, all later economists declared that the most obvious cause of the particular crisis was the only possible cause of all crises.” (p 122)
Marx could also here be criticising all of those “Marxist” economists, today who have mono-causal theories of crisis, whether it be in relation to credit, or under-consumption, or disproportion, or the law of the falling rate of profit. Marx, in Chapter 17, rejected the idea of there being some single cause of crises, and instead sets out that the specific causes of each crisis can only be investigated concretely. Where some wish to point to a single cause of such crises, such as the law of falling profits, or credit, or under-consumption, or disproportion, Marx rejects such a vulgar approach. These single cause explanations are rather like explaining every plane crash by the ever present force of gravity, whereas Marx's method is more like that of the forensic investigator, who searches amongst the debris to look for the failed engine, the electrical fault, the fractured wing, etc. And, Marx, consistent with that approach, makes the following comment, in respect of the idea that the cause of crises can be located in the role of credit.
“The author also admits that the credit system may be a cause of crises (p. 81 et seq.) (as if the credit system itself did not arise out of the difficulty of employing capital “productively”, i.e., “profitably”). The English, for example, are forced to lend their capital to other countries in order to create a market for their commodities. Over-production, the credit system, etc., are means by which capitalist production seeks to break through its own barriers and to produce over and above its own limits. Capitalist production, on the one hand, has this driving force; on the other hand, it only tolerates production commensurate with the profitable employment of existing capital. Hence crises arise, which simultaneously drive it onward and beyond [its own limits] and force it to put on seven-league boots, in order to reach a development of the productive forces which could only be achieved very slowly within its own limits.” (p 122)
The author of the “Inquiry” explains the Ricardian theory of why this accumulation results in falling profits. In this view, labour and capital form the demand for each other. In other words, the available labour creates a demand for capital, in the shape of means of production, without which the worker cannot produce. But, similarly, the available capital forms a demand for labour, without which the means of production lie idle, and no profits are produced. Its on this basis that the worker must provide unpaid labour to the capitalist.
“He must do so, or the capitalist would not have afforded him this assistance” [op. cit., p. 102].” (p 122)
In other words, unless he provides unpaid labour the capitalist would not have provided means of production.
““But as the capitalist’s motive was gain, and as these advantages always depend, in a certain degree, on the will to save, as well as on the power, the capitalist will be disposed to afford an additional portion of these assistances; and as he will find fewer people in want of this additional portion, than were in want of the original portion, he must expect to have a less share of the benefit to himself; he must be content to make a present” (!!!) “(as it were) to the labourer, of part of the benefit his assistance occasions, or else he would not get the other part: the profit is reduced, then, by competition” (loc. cit., pp. 102-03).” (p 122)
This, in fact, is closer to the explanation of the falling rate of profit given by Smith than Ricardo. As Marx summarises it,
“This is very fine. If, as a consequence of the development of labour productivity, capital accumulates so quickly that the demand for labour increases wages and the worker works for a shorter time gratis for the capitalist and shares to some degree in the benefits of his more productive labour—the capitalist makes him a “present”.” (p 123)
The author of the same work believed that high wages acted as a discouragement for workers, but, typically, opposed the high rents imposed by landlords, because he considered that low profits are a discouragement for capitalists. We see the same two-faced approach today with workers told that they should not expect more than subsistence, minimum wages, for fear of not being employed by firms unable to extract sufficiently high profits from them, whilst workers are told that top executives, bankers and the like must be paid millions per year for fear they will go to work elsewhere.
No comments:
Post a Comment