Robert Peter Burns
rburns at chaph.usc.edu
Thu Feb 1 18:56:41 MST 1996
On Mon, 29 Jan 1996, replying to me Paul Cockshott wrote:
> This is inconsistent on two counts.
> 1. Savings are the excess of reciepts over expenditure, if
> the personal sector has net savings, these can not be
> absorbed by redistribution within the personal sector. They
> must be lent either to enterprises or the state.
I am assuming all personal savings will be used to finance
consumer and housing loans or government spending on "social
consumption" (e.g. subsidies for arts, sports, etc). So there
need be no net savings in the personal sector--one worker's savings
will be another worker's loan to buy a house or some furniture. And
if private savings rise, the cost of loans should fall. At any rate I
am not assuming *net* personal savings.
> 2. If we include deposit accounts held by enterprises, which
> you admit will exist, among the debts of the banks, this
> implies that they are to be secured on loans against consumption.
> This implies a net financial surplus of the enterprise sector
> and financial deficit of the personal sector, which not only
> contradicts the prior assumption of net personal savings, but
> if true implies an unproductive use of the financial surpluses
> that do exist.
There was no prior assumption of net personal savings. And
why must using available funds to finance consumption and housing
needs imply an *unproductive* use of financial surpluses? Why
must all saving be invested in machinery, even when there are
workers whose consumption and housing needs are not capable of
being met from their current income? And must governments never
borrow money from the public? This sounds a wee bit like the
capitalist nostrums against working class consumption and public
borrowing, which I'm sure you didn't intend it to.
rburns at scf.usc.edu
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