Friday, April 02, 2010

Mythology and revolution

There is a beautiful sister and an ugly sister. We know such tales from childhood.

There is the allure of the beautiful female face that seems to summon us. And there are the hissing snakes for hair and the gorgon features of the face that repulses us.

In his 1848 article for the Neue Rheinische Zeitung about the June revolution of 1848, Marx gives us a story of the beautiful sister and the ugly sister in terms of revolutions. The part played by the beautiful sister is the universal revolution that overthrows the signs of the old order. This revolution is conducted under the sign of the universal family – except it is no longer a family with a father at the head of it. No, this is the family of brothers, of fraternity. But this revolution conceals within it an undermining fact. Just as Cinderella does all the chores that allow her sisters to appear beautiful, so, too, does the proletariat do all the chores that allow for the beautiful overflow of fraternal feelings. When the proletariat gets tired of playing this role, it rises up. This is the revolution of the ugly – the ugly sister of the beautiful revolution. The story shifts, at this point. Cinderella’s godmother does not turn her into the beautiful woman she secretly is. Rather, the godmother – a chthonic which – takes Cinderella’s place.

“The February revolution was the beautiful [schöne] revolution, the revolution of universal sympathies, because the contradictions which erupted in it against the monarchy were still undeveloped and harmoniously slept next to one another, because the social struggle which formed their background had only achieved an airy existence, an existence in phrases, in words. The June revolution is the ugly revolution, the repulsive [abstoßende] revolution, because the phrases have given place to the real thing, because the republic itself has bared the head of the monster by knocking off the crown which shielded and concealed it.”

The repulsive face of the monster - who does it belong to? The phrase about the repulsive revolution suggests that the monster is the working class – a monster concealed by the old order. But it is more than the working class. The proletariat is the product of the bourgeois system. Thus, in the house of the father, the monster is concealed – and when the brothers rise up to destroy the father – a story of Freud’s, remember – what do they find? Father was a bluebeard. But they, the brothers, far from being innocent, have merely used the crown to conceal their own work.

The monster’s head comes back in the preface to the first, German edition of Capital. Here, the same unveiling takes place. Again, what the monster is, and who is responsible for it, becomes cloudy – is the monster the system or the product of the system?

Where capitalist production has been completely assimilated by us, for example, in the actual factories, the conditions are much worse than in England, as the counterweight of factory regulations is missing. In all other spheres as, besides, in the whole of continental Europe, not only the development of capitalist production hurts us, but the lack of its development as well. Next to modern distresses, a whole series of inherited distresses also oppress us, springing from the vegetative continuation of archaic, obsolete modes of production, with their train of obsolte social and political relations. We not only suffer from the living, but the dead. Le mort saisit le vif!

In comparison to England, social statistics in Germany and elsewhere on the continent are in a miserable state. Yet they lift the veil just enough in order to allow us to see the Medusa head behind them.”

Who would want to see the Medusa head? Here, there is – or there is supposed to be - a crack between the mythological and the revolutionary. To lift the veil and gaze upon the repulsive medusa is the first step, for the revolutionary, in the long process of sezing control of the social conditions that produced the Medusa.
And yet, is the mythological so easily tossed aside? Reading the history of the socialist movement, it is impressive, to me, that the greatest actors in that movement seem to come up with the worst readings of Marx. Instead of emancipating themselves by way of the ugly sister’s strategy, they stand, rooted to the spot, by the sheer power of the system, and find ways to deal with it.

Meanwhile, those, like Lenin, who did understand that the system was ineradicably rotten, end up instituting capitalism by way of the state. Lenin’s NEP is the only live fact in communism – its heir is the policy of the Chinese communist party.

“Perseus needed a cap of invisibility to pursue the monster. We pull the cap of invisibility deep over our eyes and ears, in oder to be able to deny the existence of the monster.”

Every day, the newspaper bring us evidence of the existence of the monster, and every day, we pull our cap more deeply over our eyes and ears. Today, in the business section of the NYT, there is a story marveling over the docility with which the people of Lithuania have allowed the government, on purpose, to slash spending and sink the Gross Domestic Product by 15 percent. Why did the government do this?

“But Mr. Kubilius and his team [the president of Lithuania]say that with a budget deficit of 9 percent of G.D.P., a currency fixed to the euro and international bond markets unwilling to lend to Lithuania, the government had no choice but to show the world it could impose its own internal devaluation by cutting public spending, restoring competitiveness and reclaiming the good will of the bond markets.”

Restoring competitiveness, as one finds later in the article, has a correlation with the booming business of suicide:

“The psychological toll has been immense. Suicides have increased in a country where the suicide rate of 35 per 100,000 is already one of the world’s highest, local experts say.

According to figures collected by the Youth Psychological Aid Center, telephone calls to its hot line from people who said they were on the verge of committing suicide nearly doubled last year to 1,400, from 750.”

Meanwhile, the electorate awaits… for something.

In the reception area of the bank’s headquarters, bankers laughed and drank beer from a well-stocked bar as rock music played in the background.
It is a far remove from the soup kitchen at St. Peter and St. Paul’s Church in Vilnius, where 500 people a day line up for a free meal of soup and Lithuanian pancakes.

Mecislovas Zukauskas, 88, a retired electrician, has lived through the devastations of World War II, the Soviet occupation and, most recently, the death of his wife. He is taking his pension cut in stride.
“The government does what it wants to do,” he said. “We can do nothing.”

Can we really do nothing? And if we agree to that, what was the beautiful revolution for, anyway? Questions that no NYT reporter asks. A former New York Herald reporter, however, would remember that the point of revolution is not, finally, to end up in the good graces of the bond market.

Thursday, April 01, 2010

Dixi et salvavi animam meam.

But let man and beast be covered with sackcloth, and cry mightily unto God: yea, let them turn every one from his evil way, and from the violence that is in their hands.
9Who can tell if God will turn and repent, and turn away from his fierce anger, that we perish not?
10And God saw their works, that they turned from their evil way; and God repented of the evil, that he had said that he would do unto them; and he did it not.”

Marx’s God was entirely higher order of divine beast, who had in his hand a bill of indictment linking the thread counts of every yard of sack cloth to the bloody fingers of its blind seamstress.

As I have indicated, Marx’s well known doctrine according to which the contradictions of capitalism vow it to a perpectual cycle of crisis became a polemical weapon to move socialism to an accomodationist position, one in which the governing class, periodically repenting its evils and reforming its regulations, would thus turn away the evil that otherwise would be done to them by the proletariat.

It was over this issue that the lion roared his last great roar – which, as is well known, discomforted the lion’s supposed heirs. One of the costs of inheriting holy writ from a man who is still alive is that the author can unexpectedly round on the adorers. When Marx received the Gotha program, around which the Socialist Democratic Worker’s Party was to be organized, he recognized the imprint of his old antagonist, Lassalle. Old antagonist, and yet co-worker –for it was through Lassalle that Marx’s name became known in Germany. After Marx’s death, Engels, who was, now, the revered elder, found that nevertheless, times had moved on, and Marx’s intemperate remarks (had the prophet gone senile?) were not the kind of things to be published for everybody to read. Marx’s glosses are scathing - about the rhetoric of the program, about the nationalism, about the idolatry of the state, about the peace and democracy platitudes that disguised the police state, about the sentimentalizing of work, about the desire to chase women – witches once again! - out of the public sphere, and seemingly willing to pick nits concerning labor and labor power.

But Marx never made a mountain out of a molehill that did not, to his eye, contain a Himalayan potential. Lassalle’s men, Marx saw, had moved communism backwards: back to a theory about distribution. Back to the pre-scientific socialists.

Marx never wrote a book entitled “Distribution”. The point of Capital was not that the system of distribution was unjust – rather the point of Capital was that the system of production was inhuman, a contradiction at every point of what the definition of the human that had emerged in the great revolutions that had founded our modernity.

Lassalle, of course, won. At least he has up until now. Marx’s demand is so total – involving as it does the dissolution of classes as the result of the overthrow of capitalism – that the reader, even today, instinctively flinches. Leon Bloy, Marx’s Catholic antithesis, has the same fierce sense of demand, which, for him, is the essence of divinity. God demands that you eat his flesh and drink his blood. And all of civilized Christianity, and every truism about family, and every attempt to make that demand the equivalent of being good, is an absolute falling away from the divine. The absolute, in the fallen world, always takes on the mask of the banal.

… In the Grundrisse, Marx clearly sets out the contradictions inherent in capitalism, the sum total of which expresses itself in crisis.

"First of all, there is a limit, not inherent to production generally, but to production founded on capital. This limit is double, or rather the same regarded from two directions. It is enough here to demonstrate that capital contains a particular restriction of production -- which contradicts its general tendency to drive beyond every barrier to production -- in order to have uncovered the foundation of overproduction, the fundamental contradiction of developed capital; in order to have uncovered, more generally, the fact that capital is not, as the economists believe, the absolute form for the development of the forces of production -- not the absolute form for that, nor the form of wealth which absolutely coincides with the development of the forces of production. The stages of production which precede capital appear, regarded from its standpoint, as so many fetters upon the productive forces. It itself, however, correctly understood, appears as the condition of the development of the forces of production as long as they require an external spur, which appears at the same time as their bridle. … These immanent limits have to coincide with the nature of capital, with the essential character of its very concept. These necessary limits are:

(1)Necessary labor as the limit of the exchange value of the potential of living labor, or of the wage of the industrial population;
2) Surplus value as limit on surplus labour time; and, in regard to relative surplus labour time, as barrier to the development of the forces of production;
(3) What is the same, the transformation into money, exchange value as such, as limit of production; or exchange founded on value, or value founded on exchange, as limit of production. This is:
(4) again the same as restriction of the production of use values by exchange value; or that real wealth has to take on a specific form distinct from itself, a form not absolutely identical with it, in order to become an object of production at all.
However, these limits come up against the general tendency of capital (which showed itself in simple circulation, where money as medium of circulation appeared as merely an evanescent thing, without independent necessity, and hence not as limit and barrier) to forget and abstract from:
(1) necessary labour as limit of the exchange value of living labour capacity; (2) surplus value as the limit of surplus labour and development of the forces of production; (3) money as the limit of production; (4) the restriction of the production of use values by exchange value."

These internal limits of capitalism are the key to the surface problem of distribution. Because production is tied indirectly to use value – on the one hand, the use value, to the capitalist, of the working time he buys, and on the other hand, the use value to the potential consumer of the commodity – there is no direct connection between the use value of the product and the quantity in which it is manufactured. It is, as it were, manufactured blindly. But in as much as the more the capitalist can exploit the laborer, the more surplus value he gains, the tendency is weighted towards overproduction. This is rooted not directly in the conditions of the marketplace, but more fundamentally to the conditions of production under capitalism. In as much as circulation work is subject to the same logic, it, too, will be overproduced. Every time we pick out a region of commodification in capitalist society, we will find the tendency to overproduction. Thus, to use Arlie Hochschild’s example of the emotional labor of the airline hostess – it, too, will be subject to overproduction. If the smile is your asset, you will find – as Hochschild’s interviewees affirm – that you never stop smiling. Emotional labor consists in producing, after all, the signs of emotion. Whether these signs are ‘real’ or not is as immaterial to the enterprise as the advertising slogans on the juice can are immaterial to the grocery store that sells it.
Thus, production is both limited by the incentive system that draws it forth to continually misalign itself with total use value – giving us, for instance, more pills for male pattern baldness, and less research into malaria – and is compelled to offer ever more commodities and ‘choices’, ultimately driving down the level of the realization of the value of these things for the capitalist.

At the end of the Gotha program, Marx signs off with the latin sentence we are quoting as the title of this post. It means, I have spoken and saved my soul. This must be the last sentence in my little book on Marx. As the critique of the Gotha Program might be Marx’s last roar, it is important to note that he was a lion to the very end.

Wednesday, March 31, 2010

crisis two

According to Marx, capitalism as a subordinate economic system already appears in feudal Europe by the sixteenth century. Braudel and Polanyi would agree with that assessment – others would look at proto-capitalist enterprises in Northern Italy in the 14th century. Still, the full development of capitalism – wage labor as the predominant form of labor, the circulation of the commodity to money to commodity circle, the development of a world market and a credit market, an industrial technostructure, all really come together in the ‘advanced’ nations of Western Europe in the 19th century, and in North America, in the U.S. and Canada.

One could add that, since Marx, we have evidence for a demographic shift in households in the sixteenth century, as the paterfamilias household, in which sons and their wifes lived in the household complex with their parents, becomes much rarer, compared to the nuclear family type, in which the sons and their wives start new households – at a cost that forces up the age of marriage for both sexes. In a study of the Shipibo, an Indian group in Peru, Clifford Behrens discovered that the advent of a market economy in the sixties and seventies was marked by a similar shift to nuclear households, where before a matrilinear household pattern – husbands and wives living with the wife’s mother, which Behrens calls “uxorilocal’ – had held before, and in fact been the prevailing ethos in economic activity (a man had to provide for his wife’s mother). [Human Ecology 1992, 20: 4]

Since Marx’s death, we’ve seen two world wars and one cold war; we have seen the rise and fall of a communism that, at least, operated in Marx’s name, even if not in Marx’s spirit.

Capitalism is, of course, still here.

It has survived crisis after crisis. The capitalist class has managed to either physically exterminate revolutionaries who wanted to overthrow them or coopt the working class into arrangements that continued the process of valorization by which the capitalist accumulates surplus value from surplus labor.

At some point after Marx’s death, the inevitability of the collapse of capitalism due to its inherent crises became, as Karl Korsch pointed out in 1933, a point of entrance for reformist socialists into the system. If both crises and revolution pointed to the end of the capitalist system, then perhaps, from the point of view of crises, one could bargain with the system and fix it – in return for the worker’s receiving a higher share of the product.

Korsch was certainly not the only one to question the viability of this strategy.

Undoubtedly, we could look at the developed countries and say, Marx was wrong. The position of the working class was on the upswing, and as less variable capital was needed, the reserve industrial army was comfortably shoved into circulation work.

However, if we broaden our view, we might notice that the productive process, relocating in ever cheaper locales, is still actually mired in 19th century conditions. Meanwhile, the social cost of development has become global. While the U.S.S.R. might be remembered best, in the end, for having created the greatest human caused environmental disasters in history – this is surely true of the assassination of the Aral Sea – the acidification of the ocean and the unstoppable increase in CO2 in the atomosphere, which is leading to a global disaster such as homo sapiens have never faced, is surely equally condemnatory of the system we now live under.

It is in this broad overview that I want to locate crisis in Marx. Historically, I’d contend that the crisis doctrine has allured Western intellectuals into Marx’s teaching more than revolution. It has given Marxism the cast of a doctrine that preaches the historical inevitability of the collapse of capitalism due to contradictions in its immanent laws.

My presentation of Marx, on the contrary, is based on revolution – which hypothesizes that history is not, like nature, ruled by inevitable laws. However, a system may be constituted by relationships that derive, inevitably, from its fundamental structures. It can and does generate a second level of necessity, that is coordinate with its predominate mode of production. Revolution, which is itself dependent on a level of un-endurability, or alienation, does not emerge as some similar inevitability in the system. A system can collapse without causing a revolution, or without its collapse being caused by a revolution.

Such, at least, is the way I take Marx’s idea of revolution, which distinguishes it from the crisis of capitalism.

The questions is, then: what causes the crisis? And how does capitalism recuperate, or reproduce itself, given crises?

Let’s start with the contradiction between the classes. If the worker is dependent on the capitalist to the extent that he needs to sell his labor in order to survive, the capitalist is dependent on the workers to the extent that the purpose of his enterprise is to make a profit. The capitalist could care less about the efficient allocation of capital – the latter has never bought a yacht or merged two corporations in a deal paying off handsomely for the management. The capitalist only cares about profit. “The contradiction between production and valorization [Verwertung – realization in the standard translation] – the unity of which is capital, according to its concept – must be grasped still more immanently than simply as the indifferent, seemingly independent appearance of the individual moments of the process, or that the totality of the processes against each other.”

Marx projected an interesting scenario to explain crises as something that originates not in the circulation of money, but in the sphere of production. The scenario begins by distinguishing between two types of capitals – constant, which is all the dead labor in durables, instruments, machines, etc. – and variable – which is live, human labor. It is from that live human labor that the capitalist derives his profit – that is, the surplus labor objectified in the commodity. However, there is a tendency that the capitalist can’t avoid – the increase in constant capital in relation to variable capital. Competition, working on the surface, More dynamite, more meat, more Barbie dolls. More kinds of Barbie, more flavors and cuts of meat, more sophisticated explosives.

Marx makes a controversial move here – he claims that this general tendency – more constant capital, less variable – expresses itself in the fall of the rate of profit. Or at least that is one interpretation of the fall of the rate of profit.

There is, of course, another Marxian interpretation which claims that the working class makes the rate of profit fall when they become strong enough to bargain for higher wages, or another words, they cut into the surplus value of the capitalist.

Tuesday, March 30, 2010

Gunpowder and Money

George Bernard Shaw’s play, Major Barbara, came out in the year 1905. In that year, the industries of Europe and the United States were humming, and none more so than the Nobel Dynamite trust. Alfred Nobel not only invented safe explosives, but – in his search for strategic partners – he helped invent a new, multi-national corporate form. Munitions industries were peculiar things in the Europe of the time. Many of them were state run, on the premise that the state alone should be trusted with management of weapons manufacture and the secrets of weapon improvement.

Nobel, of course, was not manufacturing for the state. His dynamite built the railroads – or at least blasted out the tunnels through which track was laid – and opened up new passages in mines. Through complicated contracts with Dupont and various German chemical companies, Nobel and associates pretty much dominated the world explosives market. And given the need for ever new markets, the cartel also developed explosives for military use. Thus it came about that in the years before WWI, there was a lively interchange of chemical formulas for blowing things up in ever new and creative ways between Imperial Britain and Imperial Germany.

Shaw’s play is a paen to money, from the point of view of a man who called himself a socialist. The millionaire Undershaft confesses his deepest belief in a conversation with his potential son in law, the Greek scholar Cusins:

“CUSINS. You know, I do not admit that I am imposing on Barbara. I am quite genuinely interested in the views of the Salvation Army. The fact is, I am a sort of collector of religions; and the curious thing is that I find I can believe them all. By the way, have you any religion?
CUSINS. Anything out of the common?
UNDERSHAFT. Only that there are two things necessary to Salvation.
CUSINS [disappointed, but polite] Ah, the Church Catechism. …
UNDERSHAFT. The two things are--
CUSINS. Baptism and--
UNDERSHAFT. No. Money and gunpowder.”

Shaw’s relish of paradoxes has not always worn so well. For instance, the ‘paradox’ that a courted woman also does the courting is not exactly a shocking state of affairs for anybody outside the narrow circle of the Irish Protestant society in which Shaw grew up. Henry James is infinitely more subtle about such things. But in announcing the gospel of money and gunpowder, Shaw found an enduring paradox, one that still digs into us if only because it is a paradox that has unfolded at the cost of tens of millions of lives in the 20th century. The wealthiest nations have also all been the most savage nations. Their wealth stinks of gunpowder. And even those countries that have not, themselves, been great aggressors, as for instance Nobel’s Sweden, have accumulated great wealth by selling weapons to those who want to, and will, use them. In the U.S., the military has long been an economic mainstay, the sector from which all good things flow – such as computers and the internet.

While I have been working out the pattern of Marx’s central thoughts, I have been interested in projecting them against our current circumstances, and the historical circumstances that lie between us and Marx. In the developed world, those circumstances have led to a post-industrial political economy – that is, a shift of the great mass of workers from manufacturing work to circulation work. Just as the agricultural sector was ruthlessly shrunk in the developed economies and is being ruthlessly shrunk in the second wave of development in China and India, so, too, was manufacturing.

These developments came about, partly, as a result of the 20th centuries numerous crises and wars, which seem to cycle between money and gunpowder. Yet, the record of crisis seems to offer us another paradox on the Shavian scale: the crises have strengthened, rather than weakened, the hold of capitalism in general upon us. If we define capitalism solely as ‘free enterprise’, of the ‘private sector’, this may not seem to be the case. Every economy of any size has adopted the mixed economy model, with a considerable part allotted to the state.

But if we define capitalism according to Marx’s standards, viz, a system of production dependent on wage labor, in which value is determined by the abstract labor time embodied in goods and services, then certainly we are still in the belly of the beast.

Looking at the crisis of 2008-2009, we see that it, too, falls into the pattern of crises that strengthen, rather than weaken, the hold of the capitalist oligarchs. There is, however, a difference between this crisis and those of the first half of the twentieth century. In the latter, the working class as a whole came out better than it went in. This time – or perhaps I should say, in the crises that have erupted over the last thirty years – the working class will be considerably weaker than when they came into it. Among the developed economies, the conviction in the oligarchic circles is that competition will demand the takedown of working class perks, and the reversal of working class salaries. The position of the working class had already deteriorated during the boom years, and it is evident that, given one of the unquestioned structures of our society – the increasing appropriation of surplus value by the capitalist oligarchs – capitalism can no longer afford a huge ‘middle class.’ Or I should say, it can’t afford it unless growth is of such a size that the bigger bite taken out by the investor class still allows the fortunes of the middle class to grow. In the Anglosphere, where the concentration of wealth at the top is the greatest, the mix of policies aimed at squeezing middle class salaries while pumping up middle class consumption has bumped up against the limit formed by that proportionality. In other words, the limit is the class composition of the ‘national’ wealth itself. The symptoms of this underlying malaise are everywhere: in the vacant house with the foreclosed sign, in the development of housing in the flood plains around Sacremento and the hurricane vulnerable Florida coast, in the two worker family that lives on income coming in and is in no position to buffer any sudden shocks with savings, and in the curious death of military Keynesianism as a tool that would give a big bang to an otherwise slow business cycle. In the 00s, the government threw trillions into the military, with no appreciable effect on employment numbers. Although the crisis struck, we are told, in 2008, that really means simply that the richest fortunes were imperiled in 2008. The median income household has been going through a crisis since 2000. The machine in the bowels of our noosphere has stopped.

So, let’s look at what the Grundrisse has to say.

Monday, March 29, 2010

Upon the iron wheel: circulation work, moving toward crisis.

[I edited this post because I had originally pieced it together out of two different themes, making it an unruly, Gemini kind of thing. Now it flows like water, almost - all the curents are folded into one stream. I hope]

“Marxian theory aims not to resolve “economic problems” of bourgeois society, but to show them to be unsolvable. Marx was a socialist, not an economist – Paul Mattick, Marxism, the last refuge of the bourgeoisie? P.87

Paul Mattick poured as much cold water as he could on the project of normalizing Marx. This project consists in finding problems in Capital that can be rephrased in terms of Walrasian equilibriums – and proceeding from this point to translate the whole system. Thus, according to Mattick, an industry has devoted itself to ‘transforming’ value into price, in response to the critiques of the bourgeois economists, without thinking of the fact that Marx continually advocates the revolutionary overthrow of wage labor – and thus of the price system as we know it. This should alert us to two things: for Marx, value as he is using the term in Capital is a historical construct of a particular mode of production – capitalism. And secondly, that Marx is not concerned with finding a way to successfully translate values into prices in such a way as to establish some grounding equilibrium from which to understand and control crises in the economic system. That is, he is not working on the parameters assumed by the bourgeois economist.

“Not searching for an equilibrium in terms of prices, Marx’s mixture of value and price relations suffices to illustrate the statement that prices and values will be altered through the competitive establishment of an average rate of profit. Whereas Marx’s example of the transformation process has only an explanatory function, Bortkiewicz [one of Marx’s critics] approaches value relations as if they were actually ascertainable in price relations. Like Ricardo, he conceives of labor-time value in terms of physical commodity units, and not, like Marx, in terms of socially necessary abstract labor time. He therefore thinks it is possible for analysis to proceed directly from technically determined observable production prices with a uniform rate of profit. But it this were so, there would be no need for value theory, for it would yield no more than can be found in price relations.” (49)

Marx, in the 1840s, the first period in which he turned to the study of the political economy as the master key to the social transformations he saw happening all around him, quickly became certain that capitalism produced its own undertakers – the proletariat- and that it was a system that was internally bound to experience crises. Revolution, as I have argued in these posts, is the truth procedure in Marx’s work. It is from the standpoint of the overthrow of the form of the class relations upon which capitalism is founded that we understand the truth of capitalism, just as we understand feudalism from the point of view of its overthrow by the bourgeoisie. That, of course, is the standpoint unconsciously adopted by the mainstream historian today – for whom feudalism is always leading to something else.

However, while revolution was one way to envision the end of the capitalist system, crisis was another. The idea of the crisis is, of course, not Marx’s alone – indeed, the cycles of the business crisis have been lamented since the 16th century. Crisis, then, there will definitely be – yet Marx wanted to understand crisis in terms of the overall structure of capitalism. Crisis has a certain similarity to revolution in that, theoretically, it could put an end to the whole system – and in fact, after Marx died, the idea of the inevitable crisis served as a sort of tool by which the reformist socialist parties could reconcile themselves to capitalism. By mitigating the causes of class struggle through regulation and the provision of public goods, the liberal state could both ensure that the working class would not struggle with the capitalists too aggressively and that the tendency of the capitalist to increase the level of exploitation as the rate of profit fell would be buffered.

Marx, in a letter to Kugelmann in 1857, sarcastically saw that all laissez faire doctrine would be laid aside when the investing class felt threatened. In that year, bank failures had initiated bank runs that had their usual effect of freezing credit and thus bringing industry to a standstill. The same Victorian respectables who had, ten years before, condemned a million Irish to starve to death because state support would weaken their will to work and encourage an inefficient agricultural sector had no problem immediately reacting to the trouble of a handful of financiers.

“It is beautiful that the capitalists, who scream so much against the right to employment, now everywhere demand public assistance from their governments in Hamburg, Berlin, Stockholm, Copenhagen, even England [in the form of the suspension of bills], thus seeking to enforce a “right to profit” at the public’s expense.”

Why, though, did crises originate in the speculative sector? And how do we distinguish crisis, anyway, from the usual degradation of the position of labor?
Talk about crisis tends to float to the top level – we tend to look at crises as they effect the financial system. Marx’s idea, that the rate of profit, collectively, tends to fall is, in fact, placed squarely in the sphere of circulation. Crisis effects the capitalists, who react to it by trying to shift the cost of the crisis on the backs of the working class by mass layoffs, cuts in pay, making jobs temporary, shifting to piecework, etc. On the largest scale, the capitalists depend on the state.

Thus, Marx needs a theory of the sphere of circulation. One way of approaching this is to ask – what kind of labor is involved in the movement that transforms commodities into money and money back into commodities?

In the sixth chapter of Capital, 2, Marx makes a start at outlining a theory of rentseeking. This theory has problems. He starts out wrongfooting himself by decreeing that the work of transforming commodities into money is not work in the proletariat sense as it does not add value. This, one has to say, threatens to fetishize value as a property of creating some physical object only. Marx begins badly, with a complicated analogy to the work of making heat – which in itself does not add to the heat. Thus, the work of the salesman who tries to sell the dynamite the Ardeer girls make does not add to the value of the dynamite, nor the work of the secretary who takes calls for the salesman.

“The dimensions, which the transformation of commodities assume in the hands of the capitalists, could naturally not be those of value creating labor, but instead only the mediating work of changing the form of value. Even so little can the miracle of this transubstation occur through a transposition, that is, through the fact that the industrial capitalists instead of themselves completing this burning labor, make it the exclusive business of third persons paid to do the task. These third persons will naturally not out of love for their beaux yeux put their labor power to this task. To the rent collector of a landlord or the slavey of a bank it is completely indifferent, that their labor does not add a jot to the value quantity of the rent nor to the goldpieces that the latter drags to another bank.”

This, it seems to me, simply can’t be the case if value theory is to have any coherence. Here it takes on a double determination, on the one hand as a property of the making of a thing, and ally stuff the components that make up the explosive charge of dynamite into the cartridge are not making is dynamite - they are part of the chain by which dynamite is assembled. Marx mostly sees this very clearly - it is only from the point of view of abstraction that we separate production and circulation.

This is what is meant by integrating the work flow. Take a thing like beef. When, in 1866, the Packers Association of Chicago, along with some local boosters, hired Octave Chanute to lay out a massive stockyard on the Chicago River’s South Branch, he directed the building of sewers for discharge, holding pens, railroad docks, etc. which in affect made connected Chicago to ranchers in Texas. The chain that was built, using drover trails, stockyards, railroads, vast slaughterhouses, and refrigerated cars to send the meat out to clients – all of it could be thought of as making meat. True, there were salesmen going out to find clients, there were packagers, there were truckers, there were clerks at the end in the store that rang up the charges for the consumer – but they were all more conveniently regarded as part of the entire meat network, than divided between those who ‘added’ value and those who only moved the meat. And the meat did keep moving:

It was a long narrow room with a gallery along it for visitors. At the head there was a great iron wheel about twenty feet in circumference with rings here and there along its edge. Upon both sides of this wheel there was a narrow space into which came the hogs at the end of their journey; in the midst of them stood a great burly negro, bare armed and bare chested. He was resting for the moment for the wheel had stopped while men were cleaning up. In a minute or two however it began slowly to revolve and then the men upon each side of it sprang to work. They had chains which they fastened about the leg of the nearest hog and the other end of the chain they hooked into one of the rings upon the wheel. So as the wheel turned a hog was suddenly jerked off his feet and borne aloft. At the same instant the ear was assailed by a most terrifying shriek; the visitors started in alarm the women turned pale and shrank back. The shriek was followed by another louder and yet more agonizing, for once started upon that journey the hog never came back; at the top of the wheel he was shunted off upon a trolley and went sailing down the room. And meantime another was swung up and then another and another until there was a double line of them each dangling by a foot and kicking in frenzy and squealing. The uproar was appalling perilous to the ear drums; one feared there was too much sound for the room to hold, that the walls must give way or the ceiling crack. There were high squeals and low squeals grunts and wails of agony there would come a momentary lull and then a fresh outburst louder than ever surging up to a deafening climax. It was too much for some of the visitors -- the men would look at each other laughing nervously and the women would stand with hands clenched and the blood rushing to their faces and the tears starting in their eyes.

Meantime, heedless of all these things the men upon the floor were going about their work. Neither squeals of hogs nor tears of visitors made any difference to them; one by one they hooked up the hogs and one by one with a swift stroke they slit their throats. There was a long line of hogs with squeals aud life blood ebbing away together until at last each started again and vanished with a splash into a huge vat of boiling water. [Sinclair Lewis, The Jungle 1920, 39]

Value would be too thinly bladed if we decide who, here, adds value and who does not.

And yet, there is a socially valid reason to separate the circulation work from the production work, if we don't hypostatize that separation too much. The bookkeeper, the floor boss, the salesman, the clerk - they may all, as a matter of fact, be as inexorably chained to wage labor as the pigs are chained to Sinclair's iron wheel. But unlike pigs, human cries are much more diverse as they are jerked up into the air and their throats slit. Some cry that they are individualists, and that any burden upon the owner of the slaughterhouse is a potential burden to them, as they, too, will one day own slaughterhouses. As the circulation worker gets more distant from the making of the product, the same ideological hierarchy to which Marx, obscurely, responds by separating out productive labor as thingmaking from non-productive labor as merely movement making works, in reverse, to make the petit bourgeois identify with the owners and investors.

Thus, even though Marx writes that the proletarianization of the circulation workers is ongoing and inevitable, their understanding of this is spotty and aspirational. In fact, so much do they employ their time in distancing themselves from classic proleterian labor that they hardly have time to think about the conditions under which they do labor. Rather, they substitute the notion that they have achieved a certain skill upon which the reward for their labor depends. This is half true. But, as we have seen, any skillset also gets chained, figuratively speaking, to the iron wheel - to the level of routinization to which all work is heir.

Marx himself backs away from his grand gesture, by moving on to explaining circulation work in terms of time - which of course gets us back to valorisation:

For the capitalists, who let others work for them, buying and selling are central functions. Since he adapts the product of many to the great social measure, so he must also sell it as such and later again transform it again out of money into the elements of production. Yet the buying and selling time, as we have said, creates no value. An illusion comes in here through the function of the businessman’s capital. But, without going into this here, so much is clear: when a function, which is itself unproductive, is, through the division of labor, a necessary moment of reproduction, and from an auxiliary operation of the many is transformed into the exclusive operation of the few, in its particular business, yet does this not transform the character of the function itself. One businessman (here treated as a mere agent of the transformation of commodities, as a mere seller or buyer) may through his operation abbreviate the buying and selling time for many producers. He is then to be treated as a machine, that shortens the useless expenditure of power or helps set free production time.”

Sunday, March 28, 2010

the three muskateers, increasing return on investment, and the crisis in the humanities

In Benjamin’s essay on Eduard Fuchs there is a passing mention of a fascinating incident:

When the 1848 Revolution came, Dumas published an appeal to the workers of Paris in which he presented himself to them as one of their own. In twenty years, he had made 400 novels and 35 plays: he had been the source of the daily bread of 8,160 people. [My translation]

I thought that was a fascinating fact, and looked up the proclamation, which is reprinted, in part, in the Nouvelle Revue, vol. 8. Here is a bit of it:

I am putting myself forward as a candidate to the legislature, and I am asking for your voices. Here are my titles to your trust:
“Without counting six years of education, four years under a notary and seven years in an office, I have worked twenty years, ten hours a day, which is 73,000 hours. During these twenty years I composed 400 volumes and 35 dramas. The first print runs of the 400 volumes were at 4,000 and sold at 5 francs, producing 11,853,000 francs. Here’s a list:
To the editors… 264,000
To the printers… 528,000
To the paper merchants…. 633,000
To the advertising brochure designers…120,000
To the bookstores… 2,400,000
To the brokers…1,600,000
To the salesmen…1, 600,000
To the deliverers… 100,000
To the bookstores…4,580,000
To the illustrators…28,000
Total: 11,853,000 In putting the daily wage at 3 francs, and assuming 300 work days, my books have, over 20 years, employed 692 people.”
And so on. [My translation]

Thus, 140 years before Romer's Increasing Returns and Long Run Growth inaugurated the growth school, taking up, finally, the issue of increasing returns on investment, Dumas had already been there.

Mainstream economics has, of course, congealed around the image of decreasing return on investment. The volume of the Three Musukateers you purchase at the store has already gone through a certain amount of deterioration by the time it is lodged on the shelf of the book store. The very act of shelving it may have bent the cover a bit. The chemicals that make up the page – even if, as the small print tells you, the pages are acid free, which became standard in paperbacks in the nineteen nineties – are of course subject to the stains and stresses of use, especially if you mix eating and reading. The glue that binds the pages – especially in a 720 page paperback, which is the number of pages in the Penguin translation of The Three Muskateers – dries and loses its hold.

Thus, as a physical product, the book you purchased rapidly loses value. Take it to a used book store and you may get ten percent for what you paid for it. Of course, the very signs of deterioration can become beloved – an old hardback “in good condition” can become a collectors item. But, in general, that particular book deteriorates in value.

But does The Three Muskateers deteriorate in value? Posing the question points to the oddity of The Three Muskateers – what is it? It is like the Kingdom of Heaven – you can’t say that it is over here, or over there. The Three Muskateers is within ye - or rather, in what Lotman calls the noosphere. It doesn’t have a unique physical embodiment. It is, to use an ugly word, information. Has that information deteriorated? This can of course happen. When I open a notebook of mine at random, I often find hastily jotted down phone numbers and names. They have no meaning to me now, no use value. They have, in fact, deteriorated in value.
The Three Muskateers, on the contrary, has only gained in value. It has been translated and re-translated into all major languages. From a hasty look at IMBD, it seems that nineteen movies have been made with that title, including one starring Mickey Mouse and Goofy. If Dumas were to write his accounts now, he would no doubt find that, over the century and a half, The Three Muskateers have generated more than a billion dollars in value.
If we compare, say, the value generated by Ulysses, from the sale of the book itself to the tourist industry that has absorbed Bloomsday, etc., to two inventions of the 20s – the lead additive for gasoline, and the CFCs that were the basis of air conditioning, both the brainchildren of Thomas Midgely – we would find an interesting info track, in which all increased in value up until a certain point. Lead based additives for gasoline, it was discovered in the late sixties, translated into lead based additives in the human body. Not a good scenario. Then, in the 1980s, CFCs, which basically made the sunbelt in the United States, were found to have made a vast and growing hole in the ozone. And so both of Midgely’s products have had a shorter shelf life than Ulysses.
The simple lesson from this is that the university that lavishes attention and money on building that bio-engineering laboratory, and stingily withholds money from the English department building that was erected in 1910, is actually making an irrational decision even under its own capitalistic premises. The nano-tech device that comes out of the bio-engineering building may well never surpass, in cash value, the novel that comes out of the creative writing department. As is well known, since the late nineties, big Pharma, for instance, has spent literally tens of billions of dollars trying to develop the next generation of blockbuster drugs and has failed. The pipeline has long been clogged by mere tweaks, which exist for the sole purpose of extending patents – thus bringing together rent seeking behavior and engineering in a sort of male pattern baldness/penile lengthener festuche. But the humanities departments seemingly don’t know how to fight for themselves on this terrain. They should, of course, turn to Alexander Dumas for help. Also, they may want to try his recipe for Anchoïade Monte Cristo

Biden's foreign policy: let's bet everything on authoritarianism!

  And watch it all slip away (Por fin se va acabar) Or leave a garden for your kids to play (Jamás van a alcanzar)  --- The Black Angels, El...