Sunday, December 17, 2006

Review: Social Equality (II)

A look at the injustices and dangers of capitalism in the second installment of Earnest Mandel’s “From Class Society to Communism”.

As the first part of this review tried to introduce the human dilemma of “Socialism vs. Barbarism” and briefly discuss a few issues associated with socialism (mainly its relationship with religion and the effects of the failure of the Soviet experience), this section tries to emphasize the necessity of a social equality system, through the exposure of the inherited injustices and exploitations of the capitalistic system in two main areas: The appropriation of surplus value and Imperialism. Dire injustices that should not be tolerated by any unselfish self-respecting human being and that should eventually lead humanity to ditch this primitive jungle-themed system.

To understand the main exploit of the capitalist system, one has to be familiar with the concept of “surplus value”: the base of the whole capitalist industrialized economy. To spare the reader an essay in Marxist theory here is the most basic example on surplus value appropriation: You hire a skilled worker (carpenter) to make a chair. You buy the wood for 5 currency units, you pay the worker 5 units and spend another 5 units on expenses (tools, space,…). Now you sell the chair for 25 units. The wood value and expense are “constants”: they just cost that much. That means that the 10 units “profit” that you ended up making are the surplus value that belongs to the worker, but you appropriated it for the single reason that you owned the capital (that allowed for you to buy the raw material) and that you own the means of production. The worker deserved 15 units for his work (as evident by the final price of the chair), but you practically stole his money.

Now Notice the following facts associated with this issue:
-The early capital and early fortunes appeared as a result of parasitic exploiting of the revenues of other classes: The landlords and nobility who exploited peasants as an example, and the transfer of goods and commodities across the markets (which was practically based on deception and pillage), as an other main method. However it is still simply a result of transfer of value, and the global gain of the society is scarcely increased: Some lose what others gain. However the modern capitalistic approach no longer swallows surplus value by circulation, it made surplus value a part of the production process by buying the labor power other than paying a fair return for labor. Hence turning labor itself into a commodity. The main aim of production became solely the accumulation of more capital, which led to huge exploitation of the working class.

-The capitalist has no right to treat labor as a commodity and has no right to appropriate the surplus value. Capitalists prefers to define capital as any instrument of labor, or even vaguer, “any durable goods” (According to Ernest Mandel this definition implies that the first monkey to hit a banana tree with a stick is the first capitalist!). The Marxist definition of capital is: Any value that is increased by surplus value or which attempts to acquire surplus value. One can make the point that socialism does not fight against personal ownership as much as it fights against the ownership of means of productions, that allows one minor class in society to benefit from and capitalize on its inherited status (ownership of wealth, that is turned into capital) to continue to exploit the majority of the society and make their life miserable for the sole purpose of the accumulation of more wealth.

-One may be tempted to make the argument that these members of the exploited working class may have options to improve their situation, by:
a. Refusing to sell their labor power.
The working masses do not have the freedom of choice. The capitalist society is based on forcing people to sell their labor. Actually Mandel defines the proletariat as the class that is obliged by the economic constraints to sell their labor continuously in order to survive. The proletariat is obliged to accept the price dictated by the normal capitalist conditions of the “labor market” as the price for its labor power. A price that is usually just sufficient to buy commodities satisfying those “basic needs” which are recognized socially.
[As a follow up to the last statement, notice how the capitalist system prefers its working class to have some purchasing power (after all who is going to buy all the consumer-goods?). Hence, it is constantly trying to change the proletariat definition of socially-demanded “basic needs” through constant advertisement and popular culture. However during the time of crisis (from the capitalist standpoint) like a crisis of overproduction (which ironically enough is the result of the excessive work done for minimal wages), these working classes are left to face unemployment (and even starvation) in those times of depression, economic recovery, or any other times where the capitalists feels that their return is not being maximized].

b. Seeking self-employment, entrepreneurial opportunities and small businesses.
The capitalist society is based on the centralization of capital. They may want to lead people to believe that anyone can mange to be “capitalists” but the chances are minimal, and the system is constructed over “the big fish devouring the little fish” strategy. Large enterprises defeat smaller ones, hence the big enterprises and firms expand incessantly while small businesses continue to have a very low success rates (especially outside the services sector) even in a country like the USA. Mandel presents a chart (as an indication) that shows that the percentage of the self-employed in the USA has decreased from 37% in 1880 to 9 % in 1970, while the wage-earners percentage reached 90% that year (1970).
The rare feel-good success story of the self-employed who benefited from a situation as improbable as winning the lottery keeps the working class under the illusion that this is a “fair” system where equal opportunities (to exploit people) are offered to everybody, while in reality, the this cannot be farther than the truth.

Another dangerous characteristic of capitalism is the phenomenon of surplus capital (abundant capital resulting from monopolies) that will lead to capitalist countries to seek new fields of investments and hence imperialism. As long as capitalism operated in the world market merely to sell its good and buy raw materials there was no major interest in the conquest of new territories by military force. But since the capital invested in a country is usually recovered after many years, the imperialist countries needs to establish permanent control over the countries they have invested capital in.

Now, Notice that:
-Young imperialist powers try to use the change in the balance of forces to modify the distribution of the world investment fields in their favor by means of wars. These are wars for new fields, sources of raw materials, control of the markets, and not wars for political ideas (and to quote Mandel “not for against democracy, or against autocracy or fascism). This is a major step towards barbarism.

-Imperialism is one of the principal sources of the under-development in two-thirds of the world. The colonial and semi-colonial (formally an independent state but under a foreign thumb) countries are vastly exploited by the imperialists. Every part of these countries’ economies is subordinated to the interest and dictates of foreign capital. The penetration of foreign capital may appear to provide some development of productive forces, maybe create a few small industrial towns and may develop a proletarian embryo, but it has been historically proven that the standard of living in such countries has stagnated or even fallen as a result of this penetration. Notice that this chronic under-development in these dependant countries is not due to lack of local capital or resources. On the contrary, these resources are exploited by the imperialists and the underdevelopment is sustained by constantly discouraging productive investments and industrialization, which leads to immense under employment (both quantitative and qualitative) of these countries populations.

-There has been a recent move from direct to indirect imperialist domination as a result of the national liberation movements all over the world. This change has created a new social layer in the dependant countries: the state bureaucracy. This bureaucracy sets itself up as a defendant and representative of national interests while in fact profiting from its imperialist-supported leadership to indulge in large scale private accumulation. These bureaucracies and autocratic governments that are allied with the foreign monopolies, the national merchants and usurers and the army are a burden on their populations and are another layer of servers to the imperialist capital, under a national cover. The rejection of capitalism (even in its deformed version being enforced on these countries) is a first step towards liberation from the imperialist influence and from the state-in-service-of-foreign- capital agents and representatives.

(Dear three readers: If you have managed to read through this one, you deserve the Abu Shreek Distinguished Individual Award (very prestigious by the way, and recognized in three countries and two Caribbean islands). This was supposed to be an idiot’s intro to a version of Socialism, which appears to have gone slightly in the wrong (a step higher) direction. I appreciate your patience, although the two parts seem to have completely missed the target audience. Well, maybe the third would be more palatable, but I highly doubt it).


Roba said...

Where do I pick up my award?

Anonymous said...

One of the main reasons Marxism or Marxist economic analysis is no longer en vogue is because of the "Surplus Value" issue which relies primarily on the theory of surplus value which has been completely discredited over a century ago. There no longer exist any real Marxist economists (Except for a very small number of academics at University of Utah and the New School and UMASS). Today we see al these so called cultural theorists (Those studying the humanities) commenting on the state of the global economy from a marxist perspective) using very little rigour (no Mathematical analysis or something of the equivelant of econometrics) and continue to theorize in abstractions. Personally I find the the so called "proofs" that these cultural studies people (cultural anthropologists, literature professor, English Professors and an assortment of other humanities people) to be less than satisfactory. And I remain wholly unconvinced, even with superstars such as Michael Hardt around.

Anonymous said...

I meant to say surplus value relies primarily on the labour theory of value

Anonymous said...

do u recommend any simple references " socialism for beginners" kind of books?

jameed said...

Gaza Mo said...

A weak argument written in a somewhat compelling manner. I am not usually prone to commenting on blogs but I have to intercede here because there are some crucial issues that you seem to have brushed aside in your zeal to protect the impoverished masses...

1. You simplify the socio-economic conditions associated with production and trade. I understand that you may have done that for illustrative purposes so I will use the same example to retort...
You say that the laborer that made the chair deserved the total difference of 15 monetary units but what of the facility needed for production....doesn't the owner deserve anything for the use of his property? How about those who oversee the production, count the chairs, count the raw materials (so the workers don't steal everything) do they not deserve compensation? Finally, how about the person who was able to procure the raw materials needed and deliver them for the laborer to make the chair...what if the chair gets broken in the production process or the raw materials get stolen (again by the laborers...they can't ever seem to get enough)what happens then? The workers don't care, they got their wages meanwhile the person responsible for making the whole process feasible is to get shafted...where is the fairness in that???

2. You cite entrepeneurship as a means of escaping the "trap" but accuse capitalists of making that impossible. In reality it socialism that is the greatest enemy of individualism and individual achievement. marxist theory dictates that society as a whole shares the resources and rewards. No tolerance is given for those who want to go beyond being a mindless worker, as if there is some unscripted honor in bein "mawaserjee". What don't we call it what it is...ignorance, laziness and settlement for the easy path in life. I will not disagree that it is in human nature to minimize and eliminate competiton but capitalists do it by trying to buy all the resources whilst socialists do it by making laws which prohibit everyone except ofcourse the law makers from achieving independance.

3. Finally, I must have slept 2 or 3 times whilst trying to read the you think you could some pictures in the middle or some animation or something...min shan allah.

Abu Shreek said...

In conjunction with the theme of the article the prize is not of a materialistic nature. However leave your information with our operators and sentiments of appreciation would be transported to you through telepathic waves.

I am not really involved (neither interested) in the U.S.-based economics academia, hence I may have missed the memo that announced the “surplus value” theory and Marxist economics are discredited and hence void.
I appreciate your point of view that the social studies may not be as indicative or satisfying to those who prefer the more scientific approach of econometrics and solid Mathematical work, but also keep in mind that the base of this scientific approach and mathematical models (especially those designed by American higher education institutes) are not designed to describe the above Marxist theories, but on the contrary the objective of such model is to prove its failure.
Either way, I really cannot argue any further with detailed economics, I was just trying to show a side behind the morality of Socialism, and you may be more capable of creating a model that tries to be more objective when trying to match the humanities theories to solid numbers studies.

Thank comrade Jameed

Anon2 and I would like to thank you for the link.
Gaza mo,
-I really oversimplified the production process to a one item job, trying to minimize all the other effects (which believe me, the capitalist already factored in within his expenses). The use of the property (which does not really have any solid materialistic feel to it, after all it is a space), but for rent, running cost, power sources,….purposes that was also accounted for in the tools and expenses part. Again other aspects of the complexity of a production process like raw material delivery, process supervision and the worker/owner relationship is not very relevant for this trivial example, but I am sure that economist theory books would be able to satisfying your inquiries.
The bottom line is under the current format, I really don’t see anyone being shafted other than the wage-worker, who is working extended hours to satisfy “basic needs”, while the “person responsible for making the whole process feasible” is accumulating ridiculous amounts of unnecessary wealth and believes that he is entitled to it, because he is “smarter” than everyone else!

-The allegation that Socialism stunts individual growth and individual achievements is one of the most uninformed myths about the ideology. The different here in motive: Accomplishment for an individual egotistical empty-bragging self-gloating purposes, or accomplishments for a collective sense of society and national pride where the whole society elevates as one. THERE IS A well-documented HONOR IN BEING A MAWSIRJEE, and despite what we agreed upon that the Soviet Unions model was not the perfect application of Socialism you cannot claim that the accomplishments they achieved (that was superior to many of their American counterparts) in record times were a result of the ideology that stunts creativity and promotes laziness. On the contrary it is the systems that promote fast riches and unlimited luxury to those who dare to cheat, “outsmart” and con their fellow-humans that plays on the “easy path in life” sentiments.

-Despite the fact that I appreciate your efforts in reading the article and contributing with a long comment containing many issues that needs to be further elaborated on, I cannot help but remind you that this is an Attention Deficit Disorder unfriendly area, and the format of this space would not be compromised to make it more appealing to the dreaded casual internet surfer. However if the non-existent readership continues to falter I may be forced to provide some free porn links in between paragraphs.

Pheras Hilal said...

Abu Shreek, although you managed to write an eloquent introduction to the main premises of social equality from a Communist's point of view, I do agree that your argument is somewhat weak, due to the fact that you have documented your personal observations, rather than divulging facts and statistics.

Observations, however accurate they may prove to be, are still perceived as personal thoughts, so I am assuming that this article is a manifestation of your personal beliefs and thoughts, both concealed under the impression that they may well pass as a judgment of "right" and "wrong". Both concepts are very relative, and both tend to fall under blanket statements, as even facts and statistics these days have lost some of their credibility.

True what you have said that capitalists normally do not opt to act as benevolent social planners while managing means of production. Notice that I have excluded the false, pretentious attempts of any acts of philanthropy, as it may carry a whole hidden agenda for the benefit of the capitalist altogether (e.g. tax reduction, publicity and market penetration or positioning). However these capitalists do not exploit their laborers and workers, to the extent you have referred to.

-Workers and laborers are entitled, or more often, they are awarded with a percentage of shares in X capital, once the company goes public. If they are not awarded with a modest percentage of shares, they fall under the umbrella of the capitalist, in terms of health care, social security and sometimes other benefits and merits, such as adequate education and housing.

-Assuming that you are criticizng Jordan's labor structure. Jordan's public sector is perceived as perhaps the most communist sector in a capitalist country. How do you explain the over-abundance of workers in the public sector? With the long strings of merits and privileges granted to these workers, versus the amount of labor input (which is usually zero input)? How do you explain the ever-growing paychecks delivered to these workers as they age in their jobs, and how do you explain the most ridiculous merit of all, which is pertaining a life-long position?

-In your modest and simple example, you have totally excluded any supply chain costs and expenses, which the capitalist must pay from the company's capital! You nullified any essential means of logistics, distribution costs, advertising and promotion costs. But again, these concepts did not exist in the Soviet Union I guess, because within the Soviet Union itself, each region was to a certain extent serving itself (notice that I did not say self-sufficient, because they didn't ALL needs of residents, in fact, they supplied the needs seen sufficient in the eyes of legislators), this is what inevitably led to the collapse of the USSR.

The main premise of Communism is ultimate equality, meaning that ideally, there are no methods to induce wealth into poverty pockets, because everybody is poor, therefore, everybody must be equal! You also neglected the fact that at that time, communication was rather poor and the media was heavily censored in USSR and other communist countries. What if the Internet, or at least information then, were as ubiquitous as its current state? The fall of Communism would have accelerated by light years, simply because NOBODY would've accepted to relinquish any chances at gaining wealth, for the sake of exacerbating poverty, to include virtually everybody.

Abu Shreek, communism certainly did not create any wealth for anybody, it merely leveled everybody to the degree where the society at large is poor. So it sounds tempting for the impoverished, since they won't be alone in their misery, but it would also eradicate the middle and upper classes.

Back to Capitalism. By setting your examples, you are insulting the intelligence of both laborers and capitalists.

The general notion in Jordan, is that laborers are normally grungy and poor, because the concept of labor is relatively new, and because the wages of the middle class and the lower class vary greatly (not in terms of richness, but in terms of wealth, or in other words, how much you can buy in Jordan with your money).

When I say that concept of labor is relatively new, I mean that 10 years ago, even until today (depending on your surroundings), hiring somebody to do your garden, or somebody to clean your house, is considered as a luxury, no? The idea of working for somebody else, is frowned upon.

Here is an example:

-You hire a plumber to fix your bathroom. Ok, I just remembered that you have a dirty mind, forget the plumber. You hire a carpenter to fix your chair. In Jordan, you would pay that carpenter let's say JD2 per hour. Given that your salary is JD700 (placing you in the middle class, you are earning double the GDP per capita for Jordan). So the carpenter needs to work at least 40 hours a week, in order to earn as much as the GDP per capita for Jordan, which is ideally, his monthly income. So the disparity between middle class and lower class is relatively slim. However, in an advanced country, where the carpenter, let's say brings home 3,600 monetary units, and you would earn 7,200 units. The carpenter is much more well off living in advanced country, rather than living in Jordan. So a laborer in an ideal capitalist society, is not really part of the impoverished, otherwise, behemoth corporations would not have switched their production plants to countries wehere labor is cheap!

The laborer in Jordan could not afford to buy the same things that you could buy, however, in a developed country, you and your laborer both shop from the Gap. The laborer in Jordan would find the idea of forking out JD60 for a pair of jeans somewhat absurd. While you won't.

A laborer in Jordan would ultimately exclude many "amenities" from his income to make room for necesseties. However, in a capitalist country, a laborer could afford what is considered to be an amenity to his Jordanian counterpart. Why? Because the capitalist in his country generated so many products, that these amenities have reached the economies of scale, therefore, became more accessible and cheaper in prices. But in an emerging country such as Jordan, where such amenities have lesser demand, therefore are less produced, which means that we must import these amenities from capitalist countries to satisfy consumers!

Take cereal for example. A laborer in Jordan would consider this paricular item as a luxury (oh-la-la-Ammanis might raise an eye brow at this). However, his American counterpart impetuously purchases his cereal, because its relatively cheap to his income.

Now, in your example, the capitalists are not exploiting their laborers, their laborers are happy campers working for a capitalist, but in fact, these capitalists are exploiting other laborers in emerging countries, sometimes, countries all together.

So Abu Shreek, Communism does not eradicate poverty, however it lessens the disparity between income. This is not equality, this is deprivation! I don't want to be equally poor with everybody else!

Capitalism, does not exploit its own laborers (it did in its beginnings), but then capitalists became smarter and said, "Hey, why not come up a solution, and invent Globalization? That why, we can still make money, except, we achieve that on the backs of poor and uneducated people."

A laborer in a capitalist country, is not unhappy working for his corporation, but a laborer in an emerging country, working for a corporation based in a capitalist country, is in fact the victim of all this.

Anyway, I've been silently reading your blog for quite a while, and I can easily say it's the best in Jordan. I love your wicked black humor!

Anonymous said...

Well done Abu Hilal.
Loved your polite argument and the fact that you are only 20 years old.

Abu Shreek, Keep it up and hats up for your marxist perseverance (You are not the typical ex EHZOOBAT man)

Bloggers of Jordan, unite

Mefleh 25.01.07

Anonymous said...

رئيسية الموقع :
مصر اليوم
اخر مواضيع منتديات مصر اليوم :
ترددات قنوات النايل سات الجديدة
اسعار السيارات فى مصر 2012 بالصور

اسعار السيارات فى مصر 2012

مشاركة ارباح ادسنس

اهلا بكم , اضع لكم موقعى لتتطلعوا عليه

منتديات مصر اليوم هى منتديات عامة تهتم بالكثير من الاشياء المصرية . منتديات مصر اليوم هى منتديات عربية عموما مصرية خصوصا و هى منتديات عامة تهتم بكل ما يهتم به الشباب المصرى من الحوار او النقاش او اخر الاخبار او جديد الصور و الاغانى و الالبومات و الكليبات و الافلام و النكت و الفيديوهات و الموبايلات و تحتوى على اقسام مميزة مثل قسم اللغة الانجليزية و قسم اصحاب المواقع و المنتديات و قسم البرامج و القسم الاسلامى و قسم المرأة و قسم الرومانسية و الرياضة المصرية و الكثير ....
شاهد اقسام المنتدى :
اخبار مصر صور نكت مصرية اغانى قنوات و ترددات اخبار الرياضة المصرية مشاهدة مباريات بث مباشر اسعار السيارات