Here Brenner concedes implicitly (at least) that scientific and technological development has given capitalism the possibility of immortality through continuous reductions in the capital output ratio as long (and this is implicit in his theory) as institutions such as monopolistic practices regulate "competition" and the overproduction to which it gives rise. So yes it is competition, not wage squeeze, that generates crises in Brenner's basic theory.
Brenner argues that if productivity were higher in the capital goods industry--that is if machines were created that lasted longer or were more powerful and thereby reduced the c or indirect labor per unit and therewith the denominator in the unit rate of profit--then capital would
not founder on profitability difficulties. Quite the opposite in fact.
It follows from Brenner's framework that all capital would need is to apply more and better scientific talent to the production of capital goods, credit-backed demand for which will remain strong given the ever greater profit-making possibilities they open up, as long as labor does not demand unreasonable real wage increases. The limit to capital is no longer capital itself but the shortage of irreproducible technical talent supplying the machine making sector and the unreasonableness of wage demands.
In short, Brenner dimisses this belief in a rising capital-output ratio as neo Malthusian. He argues implicitly the possibilities of capital saving or indirect labor saving are open and great in a scientific technological age--as Gillman, Blaug and Sweezy did before him.
In a closed abstract model, the life of capital is infinite as long as depressions can be weathered that elminate the high cost, high "capital to output" production that reduces the rate of profit and therewith accumulation. But in open international system of intense rivalry, fraticidal competition can engender premature obsolescence and falling profit rates. Perhaps monopolistic practices could solve this problem of uncontrolled competition, as Schumpeter theorized. Perhaps given Brenner's argument monopolistic practices would have to be coordinated at the international level. But theoretically they would solve the problem. Anyways, international joint ventures have become a staple of bourgeois life.
Anyways, I never find it clarified if capital savings innovations save capital in their flow or stock form. Bohm Bawerk wrangled with this question (I believe) . But check out the semiconductor industry: capital savings per unit of output have been achieved at the expense of minimum capital requirements in wafer fabrication plants exceeding one billion dollars. Now as long as there is direct labor saving change. And as long as the competition *which breaks out at a late stage of accumulation* is raging and the life of technology is being cut short by competitors trying to a claim a bigger share of that slow growing market--there seems every reason to expect that surplus value will fall short to assimilate capital- and labor-saving innovations. The relations of production fetter the forces of production.
Of course if capital remained a fixed magnitude, upward pressure on the OCC->declining real wages from the reduced demand for labor. But capital accumulates as well: it increases absolutely the labor power it exploits which enables the production of ever greater masses of surplus value even as the greater demand for labor, spurred by accumulation, enables workers to attentuate the increase in the growth of the rate of exploitation and thus enjoy real wage gains.
At any rate, direct labor saving beats out indirect labor saving technical change; and there may not be a sufficient mass of surplus value to assimilate expensive stocks embodying capital saving technical advance.
This elimination of direct labor seems to be a simple indication of technological progress but in capitalism it is expressed as a falling rate of profit and over time as an outbreak of fraticidal competition.
This does not mean that there are technical or "Malthusian" limits to the development of more powerful or longer lasting machines by which the capital output ratio could be reduced; only that exploitative and (yes) competitive relations of production no longer facilitate their assimilation to the same degree that they once did.
And since surplus value is siphoned off from the third world in a myriad of ways--something Brenner can't concern himself with-- the first place to expect the shortage to show up is in the breakdown of the periphery and thus the fall off in the third world and newly industrializing countries' demand for new machines. The shortage of surplus value on total capital will thus appear as realization problems posed by those putatively big "emerging" (ha!ha!) markets to first world capital goods producers and exporters. And there will be a lot of concern about global growth as impoverished periphery, one after another, goes down.
At any rate, the system is short of surplus value, not technological and scientific possibilities and talent. Indeed because value governs bourgeois life, capitalists may find it more profitable to use direct labor, paid only as wage labor, instead of these wonderful machines--a possibility Brenner ignores. Profitability can be maintained at the expense of technological progress.
Progress is no longer to be won simply through direct technological gains but through the destruction of exploitative relations of value production; indeed proletarian revolution would be the greatest productive force of all.
Brenner seems to have conceded to the immortalization of capitalism or at least the possibility thereof in its basic theory. This kind of theory contains all the "dilemmas" of the bourgeois marxist: capital, having allied itself with science, is immortal but it enforces nasty crises of "adjustment" nonetheless. Schumpeter was the greatest bourgeois marxist and Brenner demonstrates more than a family resemblance to the type. But Luxemburg and Grossmann fought the bourgeois Marxists tooth and nail.
Or perhaps splendid rebel that he is, Brenner has had to invoke inter-capitalist rivalry that escapes state capitalist or monopolistic control to demonstrate that the system cannot put a stop to the inter capitalist rivalry on a world scale that engenders the objective overproduction crisis conditions out of which the subjective readiness for revolutionary action arises. But then why will all the attempts to create international regimes, bilateral trade agreements, voluntary export restrictions, etc--all that work of bourgeois politicians and bourgeois political scientists-fail? How has the role of the revolutionary working class be clarified? Is Brenner's theory a primer for trade negotiators on the dangers of dumping in everyone else's backyard?
best, rakesh