Merger Mania

Rakesh Bhandari bhandari at phoenix.Princeton.EDU
Sun Dec 6 19:40:59 PST 1998

Henry c K, have you ever discussed matters with Andrew Austin?

>My suggestion for a solution to the current financial/economic crisis is
>simple: a massive across the board increase in wages worldwide, 25% annually
>for LDCs and 10% for MDCs, until consumption soaks up the world's overcapacity
>in production.
>As for mergers, they should be allowed only if they do not lead to layoff of
>workers and if they are accompanied by increased wages.

As Carrol Cox once brilliantly noted, if the working class ever had sufficient power to impose such reforms, anybody trying to get the working class to ask for no more than that would only be wrecking the possibility of the working class actually carrying out the revolution.

To my serious question (corrected):

>> Will the main effect of mergers be to give monopoly power
>> to national capital at home and thereby the ability to secure additional
>> surplus value in circulation while positioning these monopolies to better
>> compete on the global market in which each can undersell the other as each
>> sells at marginal costs only for the sole purpose of destroying
>> international rivals having made superprofits in production and circulation
>> at home?

Henry repeats his one sided analysis:

>Merger are not designed to increase competition, rather they aim to stabilized
>prices with increased efficientcy through labor cost reduction.

Like the monopoly capital theorists, Liu only sees the stagnation of present capitalism--restricted output and rationalized labor forces to stabilize prices and net revenue (profits) at the expense of gross employment and production. Unlike the fearless neo Trotskyist Comrade Robert Brenner, our hybrid Marxist does not see the aggression and fraticidal competition of modern capitalism at an international level. Eschewing simple dialectics, he cannot understand the inter-penetration of the opposites of stagnation and aggression and thus

ignores the upward spiral of violence and conflict in the modern bourgeois world system in which monopolies strengthen themselves at home the purpose of destroying their rivals abroad.

Henry, back to the ABC's of Leninism:

Imperialism is characterised both by monopoly stagnation and by aggressiveness. These tendencies have to be explained in their unity: if monopolisation causes stagnation, then how can we explain the aggressive character of international competition? In fact both phenomena are ultimately rooted in the tendency towards breakdown or imperfect valorisation due to overaccumulation, Henry c K.

But you take refuge in the decadent stagnation myths of John Maynard Keynes, Alvin Hansen and Paul Sweezy--who all built their systems on the faulty foundations of formal logic and bourgeois reason. But it is bourgeois science, that ugly flower of yes/yes-no/no thought, that again mystifies the working class about the violent direction of the system that makes it overthrow a matter of life and death.

>> What percentage of profits do these monopolies make at home? And ,
>> following Brenner, what are the implications of these mergers for the
>> nature of competition on the world market?

>I have never read the authors you named, nor do I have any desire to.

And here Henry c K Liu reveals the irrationalism that undergirds Chinese hybrid Marxism. Please see Werner Meissner's analysis of Chinese communist philosophy.

Thanks, Rakesh

More information about the lbo-talk mailing list