They're still waiting for the procrastinating shopper

loupaulsen at loupaulsen at
Fri Dec 27 16:45:30 MST 2002

> Here's a question for the economists on this list. What does it mean for
> Walmart et al to have a bad shopping season, when so much of what they
> sell comes from China and other countries where the working class has
> little spending power?
> How much is industrial production in the US itself affected by this
> retail down-draft?
>   Jon Flanders

(a) I don't know how the effect of the crisis is parceled between U.S.
manufacturing and Chinese/Asian/maquiladora (etc.) manufacturing.

(b) But insofar as there is ANY manufacturing in the U.S. of consumer goods
(BTW a car is a consumer good), it seems that they aren't selling it.

(c) Furthermore, if you want to figure out what the effect is going to be on
the U.S. working class, it would be a mistake to concentrate overmuch on the
manufacturing end.  I argued, in a reply to Mark Jones during the
environmental discussion, that the labor-time of retailing, marketing,
packaging, etc., all goes into the constituted value of the product under the
heading of 'costs of circulation'.  The item which is being sold at retail for
$100 might have $10 worth of raw materials in it, $10 worth of cheap
manufacturing labor performed at subsistence wages in Indonesia, and $70 worth
of transportation, processing, marketing, retailing, etc. labor which was
bought in the U.S. by the domestic capitalists.  When they can't sell the
product, they are out the whole $90.  The domestic capitalists - the shippers,
marketers, importers, traders, wholesalers and retailers - and everyone who
supplies them are all in trouble.  And all the people who sell them goods are
in trouble too.  That brings in ALL U.S. manufacturing.

(But even if you believe that the $70 in the above example should be treated
as "surplus value", which is being used to purchase 'non-productive labor',
then you end up in the same place, because the surplus value which is not
realized cannot be parcelled out, and all the 'non-productive' workers who
normally do those things are out of jobs.)

Lou Paulsen

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