something completely different...

rakesh bhandari djones at
Wed May 29 00:10:29 MDT 1996

Jon Flanders wrote:

> Read Thurow's new book The Future of Capitalism.

Here is an interesting paragraph or two from Thurow's conclusion:

"the intrinsic problems of capitalism visible at its birth (instability,
rising inequality, a lumpen proletariat) are still there waiting to be
solved, but so are a new set of problems that grow from capitalism's
growing dependence upon human capital and man-made brain power industries.
In an era of of man-made brain power industries, those who will learn to
play a new game with new rules requiring new strategies.  Tomorrow's
winners will have very different characteristics than today's winners.

"Technology and ideology are shaking the foundations of
twenty-first-century capitalism.  Technology is making skills and knowledge
the only sources of sustainable strategic advantage.  Abetted by the
electronic media, ideology is moving toward a radical form of short-run
individual consumption maximization at precisely a time when economc
success will depend upon the willingness and ability to make long-run
social investments in skills, education, knowledge and infrastructure.
When technology and ideology start moving apart, the only question is when
will the 'big one' (the earthquake that rocks the systems) occur.
Paradoxically, at precisely the time when capitalism finds itself with no
social competitors--its former competitors, socialism and communism having
died, it will have to undergo a profound metamorphosis." (326)

Like Schumpeter, Thurow also blames the market for decomposing the family,
leading to the anti-savings mentality which perilously drains the
investment fund: "indvidual fufillment now ranks higher than family in
public opinion polls. 'Competitive individualism' is growing at the expense
of 'family solidarity.'  The 'I' consumption culture drives out the 'we'
investment culture." (31-32)

So many things to unpack here (don't mind my notes; if anyone has any
thoughts, please do post them):

0. Unlike Bonefeld and Holloway, Thurow does not enter the abode of
production and clarify that only with the recomposition of necessary and
surplus labor  will  a global investment boom materialize.

This effectively gives humanity a dilemma within capitalism.  The
intensified exploitation of labor and a potential global boom on that
basis; or intense, survival of the fittest competition over the limited
demand for both producer and consumer goods in a depressed world economy.

If so, only the most efficient producers will survive, all social life will
be sacrificed at the altar of productivity, still inter-imperial rivalry
will intensify, whole places of the world will fall into oblivion.  Social
darwinism will become the global ideology; Thurow is already hinting at it
in this book.

 Leading bourgeois economists are quite aware that this could well be the
future of the capitalist system--see for example Sylvia Ostry and Richard R
Nelson, Techo-Nationalism and Techno-Globalism: Conflict and Cooperation.
(Washington: Brookings, 1995).

2. note the concern with family values in terms of its pecuniary impact.

3. while it has been shown that Marx was not illogical for his putative
failure to transform input values in a system of general equilibrium (see
for example Mattick, jr, Carchedi, Moseley, Kliman and McClone,Freeman and
Carchedi, eds),  there seems to be a new attack on the labor theory of
value: brains, not labor, create value. (In Frontiers of Political Economy,
Carchedi does theorize the new role of mental labor.)

4. what happens to the nations which don't learn to play 'the game'; would
Thurow still refuse the gift of Africa on a platter if god were to offer it
to him (he made some such hideous comment at some point). By the way, do
these brain power industries enjoy some sort of hidden transfer of value?
What are its mechanisms?

5. Is Thurow basically saying that only those with the human capital to
innovate radical new means of production will tend to get extra surplus
value (or rent and high wages, as he puts it) because on the hand of the
immediate, albeit ultimately transient, monopoly of the innovator over
supply and because of the strong effective demand for those more powerful
production means, among those firms and nations which can afford them, with
which to increase productivity-- the most effective way after all to
survive a global crisis of profitability.

I mention this point about producer good industries because almost all  of
Thurow's examples of brainpower industries are of this type:
microelectronics, biotechnology, the new material science industries,
telecommunications, civilian aircraft manufacturing, machine tools and
robots, and computers (hardware and software). (67)

So for example any nation which dominates such brainpower industries will
not only establish a highly profitable monopoly in the world market (though
it is possible that followers will carry out reverse engineering and save
the R and D) but, just as importantly,  will also have an advantage in the
retooling of other domestic industries with inputs from these brainpower
industries and thus continue to produce at unit costs below far below
social values.

6. What is the fate of unskilled labor in a world of brainpower industries?


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