Capitalism in the 21st Century: Through the Prism of Value (IIPPE)

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Capitalism will always be capitalism, but in the 21st century new forms, controversies and challenges have appeared ... This book masterfully shows the strength of Marx’s law of value and the alternative socialist planning'

Within this definition, there is little sense of imperialism constituting a system or a stage in the development of capitalism, which are characterisations that would explain the inter-imperialist rivalry that led to the First World War and other major global conflicts. For Carchedi and Roberts, imperialism is a consequence of the formation of an international average rate of profit that transfers surplus value from the technologically underdeveloped countries to the technologically advanced countries.Regular readers of Roberts’s excellent blog, “The Next Recession”, will be ­familiar with many of the arguments presented here about money. Marx developed his theory of money in the first three chapters of the first volume of Capital: Offers a rigorous Marxist interpretation of some of the major issues in contemporary capitalism. Its analysis is firmly based on the Marxist labour theory of value and is coupled with meticulous empirical support' Over time, the effect is for the quantity and capital cost of the means of production to increase relative to the labour required to produce goods. Marx calls this shift in the balance of machinery compared to labour, a rise in the organic composition of capital. The problem for capitalism is that machinery can only transfer the value already embedded in its own production. It cannot create surplus value; only labour can do that. This means that overall, capital becomes less profitable the higher the organic composition of capital. This is the tendency for the rate of profit to fall. Carchedi and Roberts discuss this law, and the various countervailing factors which act against it, in detail, but also refer to the increasing volume of evidence showing its empirical validity across economic history. The association of planning, ownership and control by the state with a move towards socialism is very common across the entire political spectrum from left to right. Apparently, the greater state ownership and planning exists, the more progress towards socialism has been achieved. Nationalisation itself is seen as progressive. This is a conception of socialism that has been rejected by the political tradition associated with this journal, which has always argued that a transition towards a socialist society requires direct workers’ control over the economy.

Explaining changes in the inflation rate involves combining the measures of purchasing power, including both profit and wages, as well as the quantity of money. For monetarism, the latter is the active factor: if there is more money, then prices go up. However, Carchedi and Roberts argue that in fact, ‘the prices of commodities, that is, their value, determines the quantity of money in circulation and not vice versa’ (p.84). Money isn’t just a token, produced by governments at will, as MMT theorists will have it (p.52), but ‘is the manifestation of value’ and so ‘a certain quantity of new value, to realise itself, needs and determines a certain quantity of money’ (p.85). PDF / EPUB File Name: Capitalism_in_the_21st_Century_-_Guglielmo_Carchedi.pdf, Capitalism_in_the_21st_Century_-_Guglielmo_Carchedi.epubHowever, Carchedi and Roberts have a different view of imperialism to the one outlined above. In their view, imperialism is defined in terms of the relationship between a technologically advanced country and a technologically undeveloped one: 24 If crisis is recurrent and if they have different causes, these different causes can explain the different crises, but not their recurrence. If they are recurrent, they must have a common cause that manifests itself recurrently as different causes of different crises. 17 Capitalist imperialism grows out of the accumulation of capital as the ­intersection of competition between capitalist states and capitalist firms. It is a global system of powerful states competing for domination of the world system using all the economic, military and political means at their disposal. Lenin, analysing capitalism at the start of the 20th century, explained the origins of the First World War as the outcome the conflict between rival imperialist powers. 23 Conventional inflation theory, and therefore policy, relies on simplistic analysis of supply and demand in various guises, and therefore misses the real causes and cycles behind changes in inflation. There is also a persistent attachment to seeing inflation as a purely monetary phenomenon, so that attention is fixed upon factors in the financial sector, whereas it is instead still very much the productive part of the economy which drives the rest of the system. As in the present period, the result of these misconceptions, all of which exempt profit from consideration, means that policies to deal with inflation are actively harmful, without having a major effect on inflation either way. Development and imperialism