[Marxism] James Heartfield responds

Louis Proyect lnp3 at panix.com
Tue Dec 9 06:53:47 MST 2008

  Dear Louis,

Do thank your listers for their comments on my article in Platypus. I am 
grateful for their, and your points. I suggest though, that they are not 
addressing the central argument that Marx's analysis of overaccumulation 
predicts that the rate of profit will fall as constant capital grows 
faster than variable capital (roughly speaking, the wage bill); whereas 
the last twenty years have seen the opposite, very low rates of 
investment in new technologies and plant, and considerable expansion of 
the workforce (34 million new jobs in the US between 1988 and 2008, 421 
million growth in the world labour force between 1996 and 2006).

Rather than constant capital crowding out variable capital, as Marx 
predicted, non-productive, and less-productive service sector, finance 
and government job growth has crowded out productive growth in industry. 
All of this of course is confirmed by Shaikh, who deduces his rising 
organic composition of capital on an ever-smaller subsection of the US 
economy, (manufacturing, narrowly defined as the only productive 
labour), losing sight thereby of the overall decline in the organic 
composition of capital, as more and more workers are in low productivity 
service sector jobs. You might argue that it is a fine distinction, 
since the end result is the same, too many capitalist claims on too 
little surplus value. Still, it ought to be of interest that the 
diagnosis Marx made of the Victorian era does not correspond directly to 
the conditions of the present (though even he might not have been 
surprised by that).

The reason for this redirection of the trajectory of capital 
accumulation is the world historic defeat of organised labour and the 
left in the 1980s. It was because wages were held down that it was 
possible for capitalism to grow extensively, by recruiting more workers, 
more cheaply (Likewise in the East, the defeat of the radical 
nationalist and Stalinist movements laid the basis for a wholesale 
expansion of capitalist employment in China, Vietnam and elsewhere). 
Indeed it would have made no sense from a capitalist point of view to 
displace cheap labour with expensive machinery (except in those few very 
high productivity industrial sectors, where skilled labour could commad 
greater wages). All of this goes directly to the relation between Marx's 
two components of accumulation, C, constant capital (machinery, plant 
and so on) and V, variable capital, wages paid to workers. It is not 
psychologism to see the struggle between the two classes as decisive in 
the course of accumulation.


James Heartfield

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