From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Sat Aug 12 2006 - 08:32:47 EDT
Rakesh, Yes, I have read H. Grossmann, in fact before I even read H. Grossman (when I was 25) I had developed a theory very similar to H. Grossmann. I have also met Jairus Banaji who translated H. Grossmann's text into English (he said he intends to translate the remainder of the book as well). I thought it was amazing H. Grossmann published this in 1929. However in some ways L. Corey (aka Louis Fraina)'s book "The Decline of American Capitalism" is superior. The trouble though with fundamentalist Marxism is, that it believes economic life exists only of production relations. Distribution, circulation and consumption do not exist. This leads to warped theories of economic development. There is plenty Marxist rhetoric about "over-accumulation crisis", but most of these people don't know what they are talking about. In Grossmann and Mattick, sometimes the argument is that the overaccumulation consists of not sufficient new surplus value being produced to valorise all (production) capital assets, at other times sufficient new surplus value is produced, but it can no longer be reinvested profitably, or in any case not at, or above, the previously ruling rate of profit. Sometimes overaccumulation applies to all capital assets, sometimes only to production capital, and sometimes only to the newly produced capital assets that are an addition to the existing physical capital stock. In their haste to demolish underconsumptionist theories of crisis, the problem of the realisation of surplus value is simply deleted, it doesn't exist. You asked rhetorically: "do you think Grossman denies the importance of profiteering through stock market speculation, real estate speculation, betting on the futures market, etc? Again please reconsult the text." No I don't, but that is a side issue - what I referred to is the false concept of valorisation involved. Contrary to what fundamentalists say, the economy consists of more than the circuit of M-C...P...C'-M' depicted in GDP statistics, and commercial trade consists of more than "stock market speculation, real estate speculation, betting on the futures market, etc". The concepts of the production of surplus value and the realisation of surplus-value have to be correctly defined. Cf. K. Marx: "As soon as all the surplus-labour it was possible to squeeze out has been embodied in commodities, surplus-value has been produced. But this production of surplus-value completes but the first act of the capitalist process of production - the direct production process. Capital has absorbed so and so much unpaid labour. With the development of the process, which expresses itself in a drop in the rate of profit, the mass of surplus-value thus produced swells to immense dimensions. Now comes the second act of the process. The entire mass of commodities, i.e. , the total product, including the portion which replaces the constant and variable capital, and that representing surplus-value, must be sold. If this is not done, or done only in part, or only at prices below the prices of production, the labourer has been indeed exploited, but his exploitation is not realised as such for the capitalist, and this can be bound up with a total or partial failure to realise the surplus-value pressed out of him, indeed even with the partial or total loss of the capital. The conditions of direct exploitation, and those of realising it, are not identical. They diverge not only in place and time, but also logically. The first are only limited by the productive power of society, the latter by the proportional relation of the various branches of production and the consumer power of society. But this last-named is not determined either by the absolute productive power, or by the absolute consumer power, but by the consumer power based on antagonistic conditions of distribution, which reduce the consumption of the bulk of society to a minimum varying within more or less narrow limits. It is furthermore restricted by the tendency to accumulate, the drive to expand capital and produce surplus-value on an extended scale. This is law for capitalist production, imposed by incessant revolutions in the methods of production themselves, by the depreciation of existing capital always bound up with them, by the general competitive struggle and the need to improve production and expand its scale merely as a means of self-preservation and under penalty of ruin. The market must, therefore, be continually extended, so that its interrelations and the conditions regulating them assume more and more the form of a natural law working independently of the producer, and become ever more uncontrollable. This internal contradiction seeks to resolve itself through expansion of the outlying field of production. But the more productiveness develops, the more it finds itself at variance with the narrow basis on which the conditions of consumption rest. It is no contradiction at all on this self-contradictory basis that there should be an excess of capital simultaneously with a growing surplus of population. For while a combination of these two would, indeed, increase the mass of produced surplus-value, it would at the same time intensify the contradiction between the conditions under which this surplus-value is produced and those under which it is realised." http://www.marxists.org/archive/marx/works/1894-c3/ch15.htm German original: Sobald das auspreßbare Quantum Mehrarbeit in Waren vergegenständlicht ist, ist der Mehrwert produziert. Aber mit dieser Produktion des Mehrwerts ist nur der erste Akt des kapitalistischen Produktionsprozesses, der unmittelbare Produktionsprozeß beendet. Das Kapital hat soundsoviel unbezahlte Arbeit eingesaugt. Mit der Entwicklung des Prozesses, der sich im Fall der Profitrate ausdrückt, schwillt die Masse des so produzierten Mehrwerts ins Ungeheure. Nun kommt der zweite Akt des Prozesses. Die gesamte Warenmasse, das Gesamtprodukt, sowohl der Teil, der das konstante und variable Kapital ersetzt, wie der den Mehrwert darstellt, muß verkauft werden. Geschieht das nicht oder nur zum Teil oder nur zu Preisen, die unter den Produktionspreisen stehn, so ist der Arbeiter zwar exploitiert, aber seine Exploitation realisiert sich nicht als solche für den Kapitalisten, kann mit gar keiner oder nur teilweiser Realisation des abgepreßten Mehrwerts, ja mit teilweisem oder ganzem Verlust seines Kapitals verbunden sein. Die Bedingungen der unmittelbaren Exploitation und die ihrer Realisation sind nicht identisch. Sie fallen nicht nur nach Zeit und Ort, sondern auch begrifflich auseinander. Die einen sind nur beschränkt durch die Produktivkraft der Gesellschaft, die andren durch die Proportionalität der verschiednen Produktionszweige und durch die Konsumtionskraft der Gesellschaft. Diese letztre ist aber bestimmt weder durch die absolute Produktionskraft noch durch die absolute Konsumtionskraft; sondern durch die Konsumtionskraft auf Basis antagonistischer Distributionsverhältnisse, welche die Konsumtion der großen Masse der Gesellschaft auf ein nur innerhalb mehr oder minder enger Grenzen veränderliches Minimum reduziert. Sie ist ferner beschränkt durch den Akkumulationstrieb, den Trieb nach Vergrößerung des Kapitals und nach Produktion von Mehrwert auf erweiterter Stufenleiter. Dies ist Gesetz für die kapitalistische Produktion, gegeben durch die beständigen Revolutionen in den Produktionsmethoden selbst, die damit beständig verknüpfte Entwertung von vorhandnem Kapital, <255> den allgemeinen Konkurrenzkampf und die Notwendigkeit, die Produktion zu verbessern und ihre Stufenleiter auszudehnen, bloß als Erhaltungsmittel und bei Strafe des Untergangs. Der Markt muß daher beständig ausgedehnt werden, so daß seine Zusammenhänge und die sie regelnden Bedingungen immer mehr die Gestalt eines von den Produzenten unabhängigen Naturgesetzes annehmen, immer unkontrollierbarer werden. Der innere Widerspruch sucht sich auszugleichen durch Ausdehnung des äußern Feldes der Produktion. Je mehr sich aber die Produktivkraft entwickelt, um so mehr gerät sie in Widerstreit mit der engen Basis, worauf die Konsumtionsverhältnisse beruhen. Es ist auf dieser widerspruchsvollen Basis durchaus kein Widerspruch, daß Übermaß von Kapital verbunden ist mit wachsendem Übermaß von Bevölkerung; denn obgleich, beide zusammengebracht, die Masse des produzierten Mehrwerts sich steigern würde, steigert sich eben damit der Widerspruch zwischen den Bedingungen, worin dieser Mehrwert produziert, und den Bedingungen, worin er realisiert wird. http://www.mlwerke.de/me/me25/me25_251.htm You asked also: "why important to relax those assumptions in addition to the many assumptions that he did relax in the course of study of counter-tendencies?" Basically because of the nature of capitalist economic growth. As E. Mandel (who based his Phd Thesis largely on Grossmann) noted, in the boom phase as well as the recessive phase of capitalist development, an unequal development will ocur, with regard to investment in Department I and Department II, and unequal growth rates will occur. Dept I industries are intrinsically less flexible in adapting to demand fluctuations than Dept II industries. This is also reflected in the differential growth rates of S/V and C/V. Generally C/V is higher in Dept I than in Dept II. Jurriaan
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