[Marxism] what way out
abuhartal at hotmail.com
Mon Mar 2 23:11:41 MST 2009
my concern is that the anticipated profitability from new investments is so weak that whatever demand support government spending provides in hopes of encouraging new investment will be neutralized by the discouragement of investment due to expectations of future higher tax rates cutting into profits. In other words, the problem of extant overcapacity can't be solved without a new source of "Malthusian" demand, i.e. demand that does not create new supply and compound the problem of overcapacity; but such a new source of demand cannot be generated without compounding the supply problem, that is underinvestment.
There does not seem to be any way out of the crisis by means of Keynesian macro-management. The question is how private investment will be revived. Fixing the banks will not be the solution;and the fixation on fixing the banks only speaks to the objective illusion that the interruption of circulation seems to be caused by a shortage of money. The resumption of private investmentwill depend on raising profitability by cutting capital costs (perhaps through a wave of employment destroying mergers and acquisitions) and raising the rate of exploitation (as a result of renegotiating wage contracts in a weak labor market).
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