From: Paul Cockshott (wpc@DCS.GLA.AC.UK)
Date: Tue Oct 09 2007 - 06:27:45 EDT
Jurrian Your assumption is that capital can exist only in labour-products which have value. But capital can also exist simply as a financial claim. If I divest from $1m of means of production and invest in $1m of gold, and thereafter divest from $1m of gold and invest in $1m of government bonds, then other things being equal, my capital is still $1m, only the form of that capital has changed. Paul From your private point of view nothing has changed, until that is, the rate of interest rises and the imputed value of your bonds is written down. From the standpoint of society as a whole, government bonds to $10billion and a powerstation with a capital value of $10billion are very different things. The bonds are the ghosts of wasted labour, the powerstation is a productive asset that still embodies labour. The bonds correspond to labour previously appropriate by the US government in the form of expended munitions and soldiering. To treat these both as capital, is, in my opinion, to confuse the surface illusions experienced by economic actors with the underlying material reality.
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