From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Tue Sep 26 2006 - 08:44:16 EDT
>>Why though? Why not study foreign trade from this theoretically >controlled perspective? > >Just quickly, I suppose you can, but what for? The nature and function of the elements of capitalist production only becomes clear from the theoretically controlled perspective of expanded reproduction. This is essentially Marx's argument about the nature of wage labour. Only from said point of view can exploitation be truly grasped. Rakesh >Basically I tend to side with >Rosdolsky/Mandel on this issue, i.e. the *necessity* of crises cannot be >inferred from the reproduction schemes, only their *possibility*. Various >kinds of uneven or imbalanced development can occur. > >As I've illustrated, each year, the net gain to the US qua "the capital >value of imported goods AND services" is nearly equal to the GDP of Italy. >Every year, chomp, there goes the GDP of Italy into the US. So you can say >that foreign trade in goods and services (disregarding for the moment some >other important capital flows) makes a rather large net contribution to US >capital accumulation, we're talking about a value of more than 10% of US GDP >here (a shelf dropped on my writing desk, crushing my calculator so I cannot >calculate the percentage easily - perhaps a sign from God to better my >ways!? Not being particularly superstitious, I tend to blame it on screws >which are too small and the condition of the wall...). > >Marx's aim with the reproduction schemes is somewhat different from Quesnay. >Marx is specifically studying: > >(1) the circulation of newly produced surplus value >(2) the modalities of the accumulation process, >(3) the general motion of total social capital, >(4) the components of the value of the gross product. > >Marx is trying to show, that his theory of surplus value and capital >accumulation will also hold in the simplest/purest cases when the >reproduction and circulation of the total social capital is considered. > >It's a very ABSTRACT and incomplete discussion, leading up to an analysis of >the reproduction and growth of the national income &product, which however >he did not write down beyond comments here and there (bear in mind he was >writing this about 60-70 years or so before the first national product >accounts were devised). > >These days we would refer to national accounts, input-output tables, >flow-of-funds tables, and balance of payments data. > >Marx comments methodologically for instance: "But we take it that the gold >mines are in a country with capitalist production whose annual reproduction >we are here analysing, and for the following reasons. Capitalist production >does not exist at all without foreign commerce. But when one assumes normal >annual reproduction on a given scale one also assumes that foreign commerce >only replaces home products by articles of other use- or bodily form, >without affecting value-relations, hence without affecting either the >value-relations in which the two categories "means of production" and >"articles of consumption" mutually exchange, or the relations between >constant capital, variable capital, and surplus-value, into which the value >of the product of each of these categories may be divided. The involvement >of foreign commerce in analysing the annually reproduced value of products >can therefore only confuse without contributing any new element of the >problem, or of its solution. For this reason it must be entirely discarded. >And consequently gold too is to be treated here as a direct element of >annual reproduction and not as a commodity element imported from abroad by >means of exchange." >http://www.marxists.org/archive/marx/works/1885-c2/ch20_04.htm#12 > >and: > >"We revert once more in general terms to the objection raised against Tooke; >how is it possible that every capitalist draws a surplus-value in money out >of the annual product, i.e., draws more money out of the circulation than he >throws into it, since in the long run the capitalist class itself must be >regarded as the source of all the money thrown into circulation? We reply by >summarising the ideas developed previously (in Chapter XVII): 1) The only >assumption essential here, namely, that in general there is money enough for >the exchange of the various elements of the mass of the annual reproduction, >is not affected in any way by the fact that a portion of the commodity-value >consists of surplus-value. (...) 2) Every industrial capital, on beginning >its career, throws at one fling money into circulation for its entire fixed >constituent part, which it recovers but gradually, in the course of years, >by the sale of its annual products. (ibid.). > >Generally, in Marx's discussion, two types of reproduction and circulation >are at issue: the reproduction of specific types of use-values (common to >all societies), and the reproduction of exchange-values, or more >specifically the reproduction of capitals and their components (which are >specific to a capitalist society, in which production of output is >conditional on capital accumulation). This is explicated more clearly by >Kozo Uno. > >Engels (who was supposed to clear up Marx's manuscripts) commented that Marx >made an effort to revise Part III of Cap. 2 and compress it - in the end he >felt Marx said basically what he wanted to say, but his treatment was >sometimes "gappy" and "fragmentary". I don't have all that Marx wrote in >this regard available here. But it should be clear that no theory of capital >reproduction is complete without a consideration of credit and capital >finance. > >I am not sure what you take Grossmann and Tony Smith to be saying (haven't >read Tony's book). > >What I take Grossmann to be saying is that there is a logic to the >reproduction process of the total social capital, such that it must >inevitably lead to one specific disproportionality, i.e. excess constant >capital invested in production, depressing the average rate of industrial >profit (but various causal chains are conceivable that lead to such an >overaccumulation). > >What I take Luxemburg to be saying is that imperialism grows necessarily out >of the conditions for the enlarged reproduction of capital, specifically the >realisation and capitalisation of newly produced surplus value (this is a >somewhat "economistic" interpretation of imperialism). Luxemburg does not >discuss the principle of comparative advantage at all, as far as I recall. >This principle anyhow became popularised mainly after World War 2, probably >because it seemed to show the benefits of foreign trade. But Luxemburg's >general definition of imperialism (start of chapter XXXI in The Accumulation >of Capital) is quite good. > >Marx also doesn't really discuss Ricardo's theory of foreign trade very much >at all in the known manuscripts, except in relation to the balance of >trade/payments. > >There is as I recall: > >(1) a fragment in the Grundrisse (relating more to monetary matters) >(2) the bits in Cap. 3 on foreign rate vis-a-vis the TRPF, and vis-a-vis the >national balance of trade and payments >(3) a few comments in TSV, >(4) some comments in journalistic articles. > >Note here that Marx says in Cap. 3 re TPRF the additional question he raises >about foreign trade is "beyond the scope of our analysis", i.e. it really >belonged to the analysis of international trade. Ricardo had, he says, >"overlooked" the contradictory outcomes of foreign trade, and instead >suggested that economic harmony would result from foreign trade, i.e. the >trading parties would gain in equal amounts, at least in the long term. > >The only directly relevant passage I know of in Cap. 3 is: > >"What Ricardo fancies is mainly this: with the higher prices realised abroad >commodities are bought there in return and sent home. These commodities are >thus sold on the home market, which fact can at best be but a temporary >extra disadvantage of these favoured spheres of production over others. This >illusion falls away as soon as it is divested of its money-form. The >favoured country recovers more labour in exchange for less labour, although >this difference, this excess is pocketed, as in any exchange between labour >and capital, by a certain class. Since the rate of profit is higher, >therefore, because it is generally higher in a colonial country, it may, >provided natural conditions are favourable, go hand in hand with low >commodity-prices. A levelling takes place but not a levelling to the old >level, as Ricardo feels." >http://www.marxists.org/archive/marx/works/1894-c3/ch14.htm (the Pelican >translation is bettter). > >I did not mean "Michel Husson" but "Michael Hudson", sorry typo. The >relevant work by Hudson is: "Trade, Development and Foreign Debt" (2 vols). >He discusses the evolution of comparative advantage/cost theories. > >Carchedi criticizes comparative advantage/cost theories in his book "For >Another Europe". So does Robert Went, in his dissertation about >globalisation. Pierre Salama and Jacques Valier in France have also >commented on it (also from the export-led development versus >import-substitution angle). Theories of "unequal exchange" such as those of >Prebisch, Emmanuel and Amin are a direct critical response to the ideology >of comparative advantage/cost theories. I'm not really familiar with the no >doubt extensive Japanese Marxian literature on this. > >My impression is that most of the conventional Ricardo-based (or >Hechsler-Oehlin) theories about the "gains from international trade" are now >in fact discredited among real economic policy makers, even although they >are still being taught as "economic wisdom" in universities and >polytechnics. > >As the World Bank says nowadays "Different policies can have the same >effect, and the same policies can have different effects, depending on the >context". > >International trade is supposed to be *beneficial to all*, and ideologically >Ricardian-type theory just seemed to provide the outline for an economic >argument of why that is. But the underlying idea is simply, that "you grow >wealthy through trading", which is the classic bourgeois idea (the >corrollary of which seems to be that you cannot grow wealthy if you do not >trade, except through crime or conquest). The idea that you could grow >wealthy through sharing or producing for the common good, is a completely >alien "socialistic" idea in this context. > >An excellent, clear introduction to recent economic thinking about >international trade is: Nigel Grimwade, "International Trade; New Patterns >of Trade, Production and Investment" (second edition), 2000. By its clarity, >it shows at the same time there exists nowadays no coherent theoretical >framework anymore for the explanation of patterns of foreign trade, only an >eclectic one (various theories or facets that are not mutually consistent). > >Haven't got time to go into greater depth, too much to do... > >Jurriaan
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