Monday, 30 November 2015

Capital III, Chapter 19 - Part 2

As Marx pointed out in Capital II, the circuit of productive capital is P...P, or C' – C'. It starts not with the advance of money-capital, but with the productive process and the creation of commodities that already represent expanded value -  capital. The purpose of its circuit is to return to this same position, to reproduce the elements of productive capital consumed in that process, so as to continue on at least the same scale. In this circuit, P. . . C' – M'. M – C … P, money-capital only represents a mere transitional phase, not a start and end point.

“It is only when, and in so far as, capital is newly invested — which also applies to accumulation — that capital in money-form appears as the starting-point and the end result of the movement. But for all capitals already engaged in the process, these first and last points appear merely as points of transit.” (p 315)

This is why Marx insists that the value of the productive-capital advanced to production must be based on its current reproduction cost, rather than its historic price, because its only on the former basis that the circuit is logically consistent. Its only on the basis of the current values, of the consumed productive-capital, that their use-value can be logically reproduced, and as Marx points out, it is this use value that must be reproduced, on a like for like basis, that must be effected for social reproduction to continue, on at least the same scale.

“This entire portion of constant capital consumed in production must be replaced in kind. Assuming all other circumstances, particularly the productive power of labour, to remain unchanged, this portion requires the same amount of labour for its replacement as before, i.e., it must be replaced by an equivalent value. If not, then reproduction itself cannot take place on the former scale.” (Chapter 49)

Marx also clarifies elsewhere that this “like for like” replacement of the physical use values is only “in terms of effectiveness”. That is a machine may be replaced by an equivalent machine, or better machine; a material may be replaced by some other material that is at least as good, and so on. This has the same effect, as if the labour-time required for production of these use values falls. In other words, if the labour-time required for the production of the use values that comprise the consumed constant capital falls, the value of the constant capital falls – the amount of social labour-time required for its reproduction is less, leaving a greater proportion of social labour-time available for other purposes.   The rate of profit - the relation between the social surplus product, and the portion of the social product that must be devoted to this like for like replacement of the use values that comprise the constant and variable-capital - thereby rises.  The opposite is true if the labour-time required for this like for like replacement increases.

The money received for the commodities that comprised the commodity-capital, is not an end point, but only the end of one stage of the metamorphosis of the productive-capital, but it is simultaneously the starting point of the second stage, of that metamorphosis, as the money-capital is transformed again into productive-capital, that physically reproduces that previously consumed. This applies equally to the merchant capital, when it assumes the function of converting the commodity-capital into money-capital.

“And although the C — M of industrial capital is always M — C — M for merchant's capital, the actual process for the latter is continually also C — M — C once it has begun to function.” (p 316)

But, as was analysed in Capital II, in relation to productive-capital, in order for production to be continuous, the same capital must be simultaneously in all its forms. Outputs are simultaneously inputs, whether for the same individual capital, as part of its labour process, or for the total social capital, as part of the process of social reproduction.

The conveyor belt was the classic manifestation of that as, along its length, its continuous movement meant that the output of one worker was simultaneously the input of the next, so that the first worker on the line was inextricably linked to the last.

The same applies to the merchant. They are not, in fact, buying in order to sell, other than when they advance their initial capital. Just like the productive capital, once it has started to function, the requirement of continuous movement means both occur simultaneously.

“But it performs the acts C — M and M — C simultaneously. This is to say that there is not just one capital in the stage C — M while another is in the stage M — C, but that the same capital buys continually and sells continually at one and the same time because of the continuity of the production process. It is to be found always in both stages at one and the same time. While one of its parts turns into money, later to be reconverted into commodities, another turns simultaneously into commodities, to be reconverted into money.” (p 316)

Incidentally, this simultaneity, which is fundamental to Marx's materialist and dialectical analysis, is rejected by the TSSI, which operates on the basis of syllogistic logic, and so denies the possibility of the contradiction implied by such simultaneity, but which is central to understanding any kind of movement and, therefore, process.

Sunday, 29 November 2015

The Blair-right Dead End

This weekend, and over the last few days, the Tory media have stepped up their attacks on Jeremy Corbyn and the Labour Party he leads. In part, it is because of a desire immediately to get support for Cameron's warmongering plans for bombing Syria. After all, nothing sells newspapers, or fills the ratings of vacuous 24 hours News Channels, better than a good old war, is there? In part, though, it also the other way round. The issue of Syria and the bombing thereof, also presnts the Tory media with an opportunity to play up the divisions between Corbyn's, Labour Party, which voted decisively and clearly just a couple of months ago against bombing, and the remnants of the Blair-right Parliamentary Labour Party, which still has not accepted that it has been consigned to the dustbin of history.

The issue of Syria is actually a good proxy for the problem that faces the Blair-rights, and others who for the last 30 years have occupied the same political centre ground. In both cases, it revolves around the same attempt to see the potential for any political regime to exist separate from the reality of the underlying social forces, and social relations in society.

There is a simple reason that the repeated attempts at liberal intervention in Afghanistan, Iraq, Libya and Syria have failed. It is the same reason that these societies had the political regimes they already had, usually of some form of Bonapartism. It is that in these societies industrial capitalism had not developed to such a stage, whereby the economy could sustain a modern bourgeois social democracy, and in the modern world bourgeois democracy can only take a stable form as a social democracy, in which a large working-class is incorporated, via a universal franchise, in which a large middle class, and bureaucracy based upon socialised capital, acts as a mediating force, and where developed means of production based upon that socialised capital, is sufficiently productive to ensure a minimum standard of living for the working-class, along with generally rising standards of living, and social protection.

When those things are absent, as they were in Britain and other parts of Europe until the latter half of the 19th century, bourgeois social democracy is not possible, and so the capitalist polity, the political regime, takes the form of Bonapartism, and within that category, we could also include the type of bourgeois liberal democracy that existed in those societies prior to that period, when the workers were denied the vote, and where the bourgeoisie, along with the landed class, exercised their rule, on the basis of repeated use of violence by its state, to suppress the workers, who had no other form of political response other than violent opposition.

That Bonapartism is, in fact, the means by which the means of production are developed to such an extent that social democracy becomes possible, which is why, however repulsive some of these regimes might be – and the political regime in Britain, where laws existed that allowed the unemployed to be branded, and taken as slaves existed up until the latter part of the 19th century, was itself pretty repulsive – considered from the Marxist perspective of what is objectively, historically progressive, they meet that criteria. Trying to impose bourgeois social democracies upon such societies when these material conditions do not exist, is not just utopian, and subjectivist moralism, but it is dangerous folly, because the inevitable consequence must be that the political regime collapses for lack of the necessary social underpinning, and leads to chaos and reaction within the society itself.

That is what has happened in Afghanistan, Iraq, Libya, and Syria. Cameron is ludicrously suggesting that he has a plan for Syria, based upon the idea that ISIS can be bombed out of existence, and that a moderate, non-sectarian government can then be installed, so that everything will be sweetness and light. But, of course, not only has recent history shown that bombing alone will not destroy ISIS, but his idea that this moderate government is somehow going to be magicked out of thin air, is not even believed by many of his own MP's, and still less by any serious analyst that has looked at the country. The only people who purvey that nonsense, as was the case with politicians like Chalabi in Iraq, or the the Libyan National Council in Libya, are the handful of professional bourgeois politicians in those countries, who actually lack any meaningful social support, and who need western intervention to replace that support, and put them in office by military power. In other words, it is just a different Bonapartist regime, disguised as liberal democracy. As soon as that external military support disappears, the reality imposes itself, and those regimes collapse.

But, in fact, a similar process has happened across the existing bourgeois social democracies too. Greece is a perfect example. For the last 30 years, the locus of the political centre has shifted to the right. That itself was a function of changed economic and social relations during that period. In the mid 1970's, the long wave boom that had run since around 1949, came to an end. That boom had been the basis of a rapid accumulation of socialised capital, upon which was based a strengthening of social democracy.

When that boom came to an end, there was a choice. Either the representatives of that socialised capital, would assert its primacy, and take measures to deal with the need to restructure, and renovate the productive relations, which would have required further inroads into the power and influence of the owners of fictitious capital, or else the latter would assert their interests, at the expense of a growth of real capital.

In the end, the latter won, and the representatives of socialised capital, and social democracy were thrown backwards. The interests of the owners of fictitious capital were furthered by money printing, and lax credit regulations, to cause bubbles in the prices of shares, bonds and property. The political representatives of that fictitious capital, were thereby strengthened, and so conservative regimes were established across Europe and North America, and along with it the professional politicians in the existing social democratic parties themselves adopted more conservative ideas.

It is that consensus between these professional politicians of all main parties, and the social milieu of journalists, and so on around them, which has defined the political centre during that period. But, that political centre existed on the basis of very definite economic and social conditions that arose during that time. Those conditions were themselves necessarily time limited. It is only possible to keep inflating asset prices bubbles for so long, before they burst, and those that exist are bigger than ever and more likely to burst than ever. And the other side of those asset prices is massive amounts of debt.

When the state attempts to pay off its own debts, as in Greece, and elsewhere by austerity, then it also reaches a point where that is no longer viable. Not only does the economy shrink, and become less productive, thereby undermining the potential to pay off the debt, but there is a limit to how much can be screwed out of workers to cover those debts too. Trying to overcome this by the old methods, of yet more debt, of “extend and pretend”, only exacerbates the problem, as Greece demonstrated, and which is why Varoufakis and Syriza were correct to have initially rejected that non-solution, of simply covering the existing debts, by further loans from the EU and ECB etc.

The only solution for Greece, as elsewhere, was to write off the debt, which means when applied generally a massive fall in stock, bond and property markets, destroying the fictitious paper wealth of all of the bond, share and property owners, in order to promote the real wealth creating power of society. But, of course, the current political centre could not promote such a policy, because it is precisely on the ground of inflating the prices of fictitious capital that it has rested and grown for the last thirty years, and it is to the social forces that depend on that, on which its own political fortunes depends.

The political centre wants to continue in the old way, but the economic and social reality makes it impossible, as Greece, and elsewhere has shown, and the more the parties of that political centre attempt to continue in the old way, the more they ensure its collapse. That is why, in Greece, that political centre collapsed, PASOK was destroyed and the same was true of the centre-right. It is what led to the creation of Syriza, not really as the kind of far-left, or revolutionary party it has been described as, but only really as the kind of social-democratic party that Labour, or the German SPD represented in the 1960's, and 70's. Syriza, Podemos, and Corbyn's Labour Party do not represent some kind of new radical left formation, but only demonstrate the extent to which traditional social democracy had been undermined, and shifted to the right over the last 30 years.

Syriza, Corbyn, Podemos and other formations across Europe, as well as Sanders in the US only indicate the nature to which the underlying social relations has caused a shift of where the political centre now needs to be. The destruction of those parties of the political centre across Europe, also symbolised by the Liberals in the UK, which are a physical manifestation of that political centre, is the necessary consequence.

And that is why the hope of the Blair-rights, and of the Tory media that those elements in the PLP can simply ignore the social reality and organise a coup against Corbyn and the Labour Party is simply wishful thinking. They first hoped that after Corbyn's election as Leader, that a large number of Blair-rights would leave as the SDP did in 1981. They did not leave, because they knew it would be political suicide. It would be to follow the Liberals into oblivion. Nor can they anymore leave today than two months ago, for the same reason.

Odious eulogists for Blair, such as John McTiernan continue to hope that some sort of coup will be organised, but that is just as unlikely. Those Blair-right MP's, who are seeking to override the democratic decisions of the Labour Party by seeking to organise a coup against Corbyn, and seek legal support to prevent him standing in any subsequent election, are already guilty of bringing the Party into disrepute. By plotting such a coup, they are acting as a party within a party, and such be expelled from the Party forthwith, by the NEC. It is also up to the party members to bring to heel any MP's who give succour to such thoughts.

But, let us assume that a handful of MP's launched such a coup against Corbyn, an that the bosses' courts backed them up in preventing Corbyn from taking part in such an election. What would be the consequence? Firstly, it means that Corbyn and his supporters, as I suggested some time ago, should organise an Emergency Rules Conference to ensure that the Party's rules are changed for election of the Leader, to prevent such a challenge. The PLP should have no more greater right in nominating candidates then any other party member. That is what One Member One Vote should really mean.

Secondly, it would mean that CLP's would be infuriated that MP's should take such a callous, undemocratic attitude towards their own party members, so that those MP's would be told to nominate Corbyn, or be threatened with their own deselection. Thirdly, Corbyn, and his supporters would use the party machinery to themselves challenge any such ruling in the courts, delaying any such election for months, during which time there would be civil war inside the party, with large numbers of MP's being put under daily pressure and facing deselection, which currently they do not.

Thirdly, even if all that failed to stop Corbyn retaining his position, the Blair-rights would have won nothing. The Party would not split as much see the Blair-rights within the PLP, fly off as a spark that would burn brightly for a fraction of a second, before dying out. As against the real Labour Party, of half a million members, with all of the trades union movement standing behind it, the Blir-rights would have a party comprising just a couple of hundred members who temporarily were MP's, and a small portion of party members who might follow them into oblivion.

The vast majority of members who already support Corbyn would be joined by others, who would be disgusted at the extent to which a handful of MP's put themselves above the party, and undermined its opposition to the Tories at a vital moment. The party has already seen the return of trades unions that left because of the dominance of the Blair-rights. The reality would be that the Blair-right MP's would be rather like the Tory MP Mark Reckless, who held his seat as a UKIPPER only for a few months until the election brought appearance into alignment with reality. They would have given their political careers a definite and short duration by their actions, as the real Labour Party, whatever name legalities might cause it to have to assume, would simply eclipse them, at every subsequent election.

That is why they have not split before now, it is why they are unlikely to split in future, and why any attempt at a coup against Corbyn would be a disaster for them, and so why they are unlikely to attempt it.

But, for that very reason, Corbyn and the party should not cause confusion over Syria, by giving these Balir-right wreckers, and their party within a party the opportunity to defy party policy with a free vote. Unlike Trident, the party's policy over Syria is clear, and past experience dictates why Labour should not support an attack on Syria. There should be a whipped vote, imposed by Corbyn in line with party policy, and if that means some Labour Shadow Cabinet Ministers decide to walk, so be it. We could probably do with a smaller, more select and cohesive Shadow Cabinet anyway, alongside a much greater role for the party itself in providing policy support for the Leader.

We have to end the undemocratic, and elitist privileging of MP's over other party members, and now is the opportune time to do it.

Capital III, Chapter 19 - Part 1

Money-Dealing Capital

Money-dealing capital, dealt with in this chapter, has to be distinguished from interest-bearing capital, dealt with later. Money-dealing capital here is a form of merchant capital. Merchant capital obtains its share of the total surplus value, because of the function it performs in selling commodities on behalf of productive-capital. It is the commodity-capital of industrial capital that has separated off into its own independent existence. But, similarly, industrial capital must always hold a certain quantity of money-capital. It requires money for circulation, and for payments; it must hold money hoards, which are the money equivalent of the value of wear and tear of fixed capital, waiting to be reproduced; it must hold money hoards which are the equivalent of realised surplus value that is not yet sufficient to be reinvested; it must hold money reserves to cover payment of wages during the turnover period and so on.

As well as the requirement to hold this money-capital, it must employ bookkeepers, cashiers, and so on to keep track of the various payments and receipts, as well as to actually make the payments and take the receipts. All of these activities are necessary functions, are costs, which, like the selling of commodities, add no new value, but which are required for the value of commodities to be realised. As with the selling of commodities, the more capital can reduce these costs, therefore, the greater the proportion of the produced surplus value that can be realised as profit.

Money-dealing capital is then the equivalent, at the level of the social capital, of the role of the bookkeeper or cashier within the firm. Its profit derives not from the lending of money, but from the provision of these services. An example, would be something like Paypal, which makes its profits solely on the basis of providing a money transmission service, or various Bureaux de Changes, or FOREX companies who make their profits from charges levied for changing money from one currency to another.

As Marx puts it,

“A portion of industrial capital, and, more precisely, also of commercial capital, not only obtains all the time in the form of money, as money-capital in general, but as money-capital engaged precisely in these technical functions. A definite part of the total capital dissociates itself from the rest and stands apart in the form of money-capital, whose capitalist function consists exclusively in performing these operations for the entire class of industrial and commercial capitalists. As in the case of commercial capital, a portion of industrial capital engaged in the circulation process in the form of money-capital separates from the rest and performs these operations of the reproduction process for all the other capital. The movements of this money-capital are, therefore, once more merely movements of an individualised part of industrial capital engaged in the reproduction process.” (p 315)

Saturday, 28 November 2015

Capital III, Chapter 18 - Part 12

The difference between the role of turnover of capital on values for industrial capital and on selling prices for merchant capital, acts to obscure the real relations. Taken solely on its own, and from the perspective of the total social capital, the value of commodities can be seen to be determined by the labour-time required for their production. But, when it comes to selling prices of commodities sold by merchants, these seem arbitrary, the price being a function of the profit margin charged by the merchant, which in turn seems an arbitrary figure, chosen by the merchant, dependent on whether they want to maximise their profits by selling a lot on a low margin, or a little on a high margin.

Because commerce preceded capitalist production, and because a great deal of economic analysis is concerned with trade, with buying and selling, rather than with production, and the creation of value, it is no wonder that these deceptive appearances, in the realm of circulation, result in faulty conceptions. Even for the industrial capitalist, they must be also concerned with buying commodities – means of production and labour-power – as well as selling them in the shape of the end product. So, it is no wonder that even they can be taken in by these faulty theories and misconceptions.

“All superficial and false conceptions of the process of reproduction as a whole are derived from examinations of merchant's capital and from the conceptions which its peculiar movements call forth in the minds of circulation agents...

The conceptions of the merchant, stockbroker, and banker, are necessarily quite distorted. Those of the manufacturers are vitiated by the acts of circulation to which their capital is subject, and by the levelling of the general rate of profit.” (p 312-3)

So, the connection between the average rate of profit, determined in production, becomes completely separated from the commercial profit, at the superficial level of competition, even though, in reality, the latter is determined by the former. For the industrial capitalist, a high level of productivity that facilitates a more rapid turnover of capital results in a greater quantity of surplus value and profit produced, for any quantity of capital advanced, and consequently, a higher rate of profit. Yet, for the merchant capitalist, a higher rate of turnover appears as the concomitant of a lower profit margin.

“Small profits and quick returns appear to the shopkeeper to be the principle which he follows out of sheer principle.” (p 314)

As described earlier, in any branch of commerce, what is described above refers to the average rate of turnover, for that branch, but, the bigger, more efficient merchants, like their industrial counterparts will be able to turn over their capital faster and, thereby make a higher than average profit.

“If competition compels him, he can sell cheaper than his competitors without lowering his profit below the average. If the conditions which would enable him to turn over his capital more rapidly, are themselves for sale, such as a favourable shop location, he can pay extra rent for it, i.e., convert a portion of his surplus-profit into ground-rent.” (p 314)

Northern Soul Classics - You Better Keep Her - Marvin Holmes & Justice

Friday, 27 November 2015

Friday Night Disco - Flying High - The Blackbyrds

Cameron's Dodgy Dossier

Yesterday, David Cameron gave one of the lamest arguments for taking the country to war there has probably been seen in Parliament. This is the man who only two years ago wanted to bomb Assad, which would have resulted in ISIS now being in charge in Damascus, and who now wants to bomb ISIS instead. Even more ridiculously, he believes that there is no reason for the UK or the US to put boots on the ground, in Syria, because those boots will miraculously appear from somewhere else. He wants us to believe that there are 70,000 “moderate” rebels, ready and able to fulfil that function. No serious analyst, in fact, no one with a brain can, or does, believe this rubbish. It is Cameron's equivalent of Blair's “dodgy dossier”.

Not even many backbench Tories believe any of this boloney, including the Tory Chair of the defence Select Committee, Julian Lewis. Many of the Tories who opposed the bombing of Syria two years ago, if truth be told, are only backing Cameron now, because they don't want him to lose a second vote on the issue, and are more concerned to drive to maximise divisions in the Labour Party, and to embarrass Corbyn, than they are about the lives of the soldiers and airmen that will be lost, as a result of their decisions.

The idea that there are 70,000 “moderate” forces in Syria waiting to provide the basis not just for defeating ISIS, but of providing the basis for a stable democratic government in Syria, is just more of the same chaff that has been thrown out in the past, in such situations. For example, we were told prior to the invasion of Afghanistan that such forces would be able to establish a stable democracy, if given the necessary backing. Even, when billions of dollars of military backing for the government in Afghanistan was provided, it did not result in a stable democratic government, but only in an unstable government, that even the US admitted was thoroughly corrupt, and which as we speak is being gradually undermined and replaced, as the Taliban prepare to take over once more.

The same thing was said in Iraq, where we were told that moderate bourgeois politicians like Chalabi, were ready to establish a stable democratic government. In fact, he was a non-starter, as were all the others put up as alternatives, because they actually lacked any real social support within the country. So, we have again a corrupt, sectarian Shia government in Baghdad, which in part has provided the basis for the growth of ISIS amongst disenfranchised and oppressed Sunnis, in the country.

Then we were told that such forces were there in Libya to do the same job. That never even got started, because it was obvious once more that democracy requires more than just holding elections. The so called Libyan National Council was a mirage, that had no real existence outside the imagination of the liberal interventionists. Having removed the only sort of secular, sort of modernising power in society, that of Gaddafi's regime, the door was thrown wide open to all sorts of reactionary forces to be unleashed, which as could have been, and indeed I did predict, at the time, would lead to a descent into chaos.

Einstein said that the definition of madness was doing the same thing over and over again, and each time expecting a different result. That sums up the madness of the position of the liberal interventionists, and of Cameron in once again proposing such an intervention in Syria. The Blair-rights, who seem incapable of having any independent thought processes whatsoever, appear set to make the same mistakes they made in Serbia, in Afghanistan, in Iraq, and in Libya. Corbyn, and the rest of the Labour Party must make it absolutely clear that we have nothing to do with their decisions, which are clearly against the Labour Party conference decision of just a couple of months ago, and against the views of more than 60% of party members, according to recent polls.

If those Blair-right MP's, see the party, and the party members in their constituencies, who are the reason they are in parliament in the first place, as irrelevant to their decisions, if they think they have an obligation to all the voters in their constituency, be they Tories, Liberals, or whatever, rather than to the party and its members, then they should do the decent thing and go. They should leave the Labour Party and stand as independents able to act freely as merely mouthpieces of the electorate. Then they would see how little their position is down to them, and how much is down to all those party members they currently seek to ignore! They should remember how all those who went before them in that venture fared.