[Marxism] Overproduction - underconsumption (was: China'snationalized sector has key role incurrent gains)

S. Artesian sartesian at earthlink.net
Tue Oct 13 16:37:10 MDT 2009

Latest estimate of China's steel making output capacity I've come across is 
in the Financial Times of 12 October-- 600 million tons, so I was 
conservative in my estimate of the capacity growth over the last year, and 
actual demand vs the increased capacity in China is less than I estimated, 
meaning the overcapacity is greater than 22% and probably over 25%.

Global output has declined more than 20% in the first half of 2009, and 
CISA has stated that China's consumption will decline this year. China's 
steel exports were about 50 million tons in 2007, current exports are only 
1/10 of that-- at about 5 million tons reported the FT on 5 October.

However, the recovery in China has the global steel industry worried.

Says the FT 12 October:  "The unexpectedly swift recovery in China's steel 
production has sparked fears that a glut of exports counld puncture steel 
prices as the global industry struggles to emerge from the downturn...."

The country apparently most concerned with China's exports?  India.

According to the FT: "SK Roongta, chairman of the Steel Authority of India 
said Chinese overproduction was 'a point of concern' for the world's steel 

Those who pay attention to these things, rather than just make things up as 
they go along,  will also note the recent protest in Brussels, I believe, 
where protesting farmers dumped millions of gallons of milk into the 
streets.  The EU, which already provides euro 55 billion in subsidies to the 
agricultural sector was moved to provide an emergency payment of euro 15,000 
per dairy farmer.

The US  has 60,000 dairy farm units, the EU has 1.4 million dairy farms. 
The price per liter received by the EU farmers has declinced from 45cents to 
25 cents.

Now this is overproduction.  Does it mean there are any fewer malnourished 
children in the world in need of milk?  Of course not, there are more than a 
year ago.  Does it mean that there is less need for milk than a year ago? 
Of course not, but capitalist production has nothing to do with need, or its 
contact with actual need is tangential, accidental-- mediated by the value 

The very essence of private property in the means of production, the 
capitalist production of milk, is that it must be "blind" to the actual 
assessment of need,  as the private producers try to realize the surplus 
value expropriated in production through exchange in the market.  Only 
through this 'blindness' can capital distribute and ration profit.

So production becomes overproduction on the very basis of the attempted 
realization of the total social value in private production.  Production 
becomes overproduction based on the very limits of the markets capital so 

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