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The Forum > Article Comments > Andrew Bolt simply does not understand Marxism > Comments

Andrew Bolt simply does not understand Marxism : Comments

By Tristan Ewins, published 24/2/2014

In response to Andrew: You're entitled to your opinion as a conservative to oppose Marxism, or leftism in general. But get your facts straight.

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Tristan,

"First there is a tendency towards a falling rate of profit; largely because competition drives constant modernisation of the means of production and more and more labour must go into this modernisation; and while innovation is a good thing the cost of this constant modernisation is passed on to workers and consumers. Many smaller businesses cannot keep up either - and this drives monopolism."

The reality is very different: competition drives modernisation, which drives productivity and specialisation. Productivity drives wage increases, prices of goods dropping, and specialisation drives the creation of small companies to supply the large companies.
Posted by Shadow Minister, Saturday, 1 March 2014 3:53:41 AM
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Tristan

A Google search:

http://www.google.com.au/#q=real+%2Bwages+historical+data

will bring up several references including a pdf of Orley Ashenfelter's "Comparing Real Wages Rates" Amer. Ec. Rev, April, 2012.

At page 4 he addresses this issue and cites Douglas (1930). This source is in Australian libraries.

Ashenfelter says: "In the United States ... even though output per hour increased in (1890-1914) real wages did not".

This is consistent with Marx.

Trade union struggles have to some extend alleviated 'capitalism in the raw' but today, most unions feel gratified if they get pay increases that merely keep pace with long-run inflation. In effect this is a real wage cut. It can be traced by watching various Australian award rates drop beneath the Henderson Poverty line.

Now we are hearing calls from various companies (QANTAS, Hunter Valley coal) to cut labour costs.

Economically, if a machine is imported from a low wage economy, and increases productivity in Australia by reducing the workforce, or shifting it to part-time, this amounts to a real wage cut in total. Even if the remaining hours are paid at higher rates.

If the machine was constructed and maintained domestically, things may be different.
Posted by Christopher Warren, Saturday, 1 March 2014 7:56:53 AM
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Shadow Minister

Your claim: "Productivity drives wage increases" only applies before Marxist crisis tendencies overwhelm countervailing tendencies.

From then on productivity leaves wages stagnant. This is clear, see:

http://www.archive.is/im398

If you click through to:

... the paper by the economist Lawrence Mishel [Economic Policy Institute] more will be revealed.

In advanced capitalism (eg. from 1970's), productivity does not drive wage increases, probably because with the amount of invested capital, most of the fresh product must go to rent and EBIT to maintain the same rate of profit.

This is a structural problem that must be understood.
Posted by Christopher Warren, Saturday, 1 March 2014 9:05:08 AM
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The problem in Australia is that Unions have priced their businesses out of a market share. In every one of the recent business closures from the cars to SPC to Qantas union bast...ry played a crucial role in their demise aided and abetted by the left policy of the carbon tax especially with Alcoa, Qantas and perhaps Virgin greatly affected.

For instance the union background at Qantas is described by Judith Sloan:

http://catallaxyfiles.com/2014/02/28/what-joyce-was-up-against/

This has nothing to do with conditions or wages but is rooted entirely in union dominance. The same dominance and its ideological basis was demonstrated during WW11 as described by Colebatch:

http://www.dailytelegraph.com.au/news/opinion/unions-exposed-as-war-saboteurs/story-fni0cwl5-1226751793596

Unions ran NSW through the crooks Obeid and McDonald; the HSU scandal will have its consequence not through Thomson's jailing but the enquiry which will lift the lid on the putridity through the rest of the union movement and if there is any justice Gillard will face criminal charges.

And this is the point; unions are the foot soldiers of Marx against the evil capitalist; yet like all Marxists they prey on their charges and on the West generally.

Their political wing, the Greens, are even worse:

http://catallaxyfiles.com/2014/03/01/moral-compass/

This is not theory as Tristan belts out but the reality. Marxism sucks.
Posted by cohenite, Saturday, 1 March 2014 9:55:18 AM
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Cohenite - Yes there's a progressive side to the competition/modernisation dynamic. It helps drive productivity and quality. And I don't see a fully planned economy as an alternative. Further: I'm with Heller/Fehr/Markus when they argue that consumers need markets in order to determine their own needs structures (that was their critique of 'big 'C' Communism')- BUT WITHIN REASON - because of areas of natural public monopoly - including most kinds of infrastructure/utilities etc; and other areas of strategic intervention.

In fact we are locked in to the global capitalist economy by trade; and Australian workers and citizens are better off if they are able to benefit from the innovations of the big multinationals than if they were locked into a kind of 'autarky'. We need to open up markets for our exports too; though again free trade should not be 'absolute' if it means losing strategic capacities, or opening ourselves up for dumping etc....

But there are other problems - such as planned obsolescence, and staggered release of technology in order to boost profits. Consumers are lucky these days if (every expensive) white goods and electricals last five years... This requires regulation.

Also capital flows to the areas of highest profitability - but that's not always where there was the need. For instance - rural Commonwealth Bank branches closing down with privatisation; Australia Post services being compromised to fatten up for privatisation. GM Holden was also profitable "but not profitable enough" for the capitalists - But the auto industry is relatively high wage - and there are the capacities and skills at stake as well... Call it 'market failure' - it's everywhere.

Also we can have the benefits of markets without the exploitation through state aid for co-operative enterprises - consumer AND producers' co-ops. And government business enterprise can actually enhance competition while provide services on the basis of need. In other words a kind of 'hybrid' which responds to market forces - but goes against them when there's an important social interest.
Posted by Tristan Ewins, Saturday, 1 March 2014 10:21:48 AM
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What a fantastic thread! It has brought out the best in all our resident intellectuals yet, sadly, it seems to have solved nothing.

It did take a lot of words to solve nothing, didn't it? While the argument raged (what was it all about? Does anyone remember? Does anyone care?) Russia invaded the Ukraine.

Now I know the argument about Bolt in Australia is very important. It is nearly as important as the argument about Abbott and his credentials to be P.M. Did they really experience clerical interference during their formative years? Did either one enjoy it? Did it add to their psycho-social development or their auto-immune system?

I think it's time to spill the beans. It should happen in Parliament of course. Bronny would have such fun. "Did you enjoy it, Dear?" would be one of her more frequent question. "Why didn't you tell your parents," would be another.

As nuclear war breaks out, Australia will be caught up in a massive, messy, sexual investigation which will last for years. The reverberations will be infinite, profound.

The final question that will be asked is: Did Australian political and intellectual development take place under the heaving sheets of Catholic or Salvation Army Institutions, etc, and can its negative effects be reversed?

Perhaps nuclear war will wipe out our unfolding splendid history and leave some questions unanswered!
Posted by David G, Sunday, 2 March 2014 12:03:54 PM
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