The Wages of Overproduction 2

dms dmschanoes at
Sat Jul 19 16:05:51 MDT 2003

LNM has taken over and turned around the Karmet steelmaking plant in

>From the hardcopy FT 7/16:

"Before the acquisition in 1995 operating costs at the plant were $268 a
tonne....That figure has been cut thanks to technical improvements to $114 a
tonne.....about 40 percent below rival steelmakers in Japan, Western Europe,
and the US. [My note: this is about to change in the US as new technologies
have brought production rates below 3hrs per tonne, to 2 hrs/tonne, with the
next advancements likely to take it down below 2 hrs/tonne].

"Much of this cost advantage is down to labour costs at the plant of...just
10 percent of the equivalent levels in Western Europe.  Yet while costs are
low, prices for the mill's steel--exported to more than 40 countries-- are
similar to those in the west, thanks to a programme of technical
improvements that has required heavy investment."

Sounds like they started out with super-exploitation and wound up with Marx,
and the distribution of profits and the establishment of the general rate of

With increasing overproduction of steel, this success story will soon turn
into its opposite as the mass of profits captured by increased technical
component stumbles and falls and then all the hardware becomes just more
dead weight around the neck of private property.

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