Hi Dave Z:
A couple of brief comments:> I > think it was pointed out in Anwar Shaikh's critique that cheaper > commodities may also be cheaper inputs in other industries thereby > counter-acting the effects on the average rate of profit.
One has to look, though, specifically at the rate of change of prices of
commodities which constitute inputs (elements of constant capital
and intermediate goods) rather than cheaper commodities in general.
> Moreover, I > can't see why a declining US industry should weaken Japanese > profitability if it is the equivalent industry in Japan that is gaining > a world market share.
Let's start with the recognition of the importance of the US *market*
to Japanese industry (NB: this could also form a good starting point
for thinking about the effect of the crisis in the US on the Chinese
economy). As US industry declines and jobs are lost here, average
and real wages decline. With the decline in wages, there is a decline in
the standard of living of most workers (and an increase in consumer
indebtedness). This decline in real wages is also expressed as a decline
in disposable income and, hence, demand. That, then, can be able to
weaken Japanese profitability. In an inter-connected capitalist world
economy, the loss for one advanced capitalist nation's economy does
not necessarily mean an equivalent gain for another or other capitalist
economies. Because the US is the leading imperialist power, other
trading partners economies are vulnerable because of that reality.
It's because of this that there are moves afoot to "de-link" their
economies from the US economy.
In solidarity, Jerry
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Received on Tue Feb 3 10:24:05 2009
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