Throught the whole period we also see an increasing rate in the organic composition of capital and in the productivity of labor, but of course that you can not see this if you identify the increasing organic composition of capital with the k/y ratio (which was constant during this time) given by conventional accounts. --------- What's wrong with this identification? Doesn't it simply measure the capital intensity of production? Isn't that what the OCC is a measure of anways? Honest questions. Perhaps the capital output ratio does not measure the level of mechanisation but can't that grow in technical terms (TCC) though the OCC in value terms remains constant or at least never grows faster than the rate of exploitation (these are hardly new questions)? In the latest MR, David McNally hangs his defense of Brenner on such possibilities.
Fabian, you may have noted that Brenner also emphatically rejects the wage squeeze argument as well as the falling rate of profit theory, yet Brenner does seem to imply that only increases in the real wage can ultimately explain the fall in the profit profit rate on which his treatise is focused (29). Now his conclusion does not imply acceptance of the traditional wage squeeze argument (see Crotty and Brenner exchange in the latest *Challenge*) since Brenner is not claiming that there was any upsurge in organized workers' power that brought the profit rate down, only (I suppose) a faster reduction in the nominal output capital ratio in mfg due to intl competition than in nominal wages.
Because intl competition did not prevent mark ups in non mfg allowing profit rates to rise in this sector despite rising unit labor costs, Brenner argues that intl competition must be held responsible for falling profitability in the mfg sector even if unit labor costs rose there as well. (Brenner's mark up theory of pricing has caused much consternation since it seems to imply a market power theory of profit unhinged from the actual surplus value pumped out in the production process--one would hope that in the book version he clarifies his underlying theory of profit, something to which Anwar Shaikh has already called attention.)
Note that Brenner does not deny that had real unit labor costs not risen in mfg, then the profit rate would have not have fallen.
In some ways, the big debate between Crotty/Henwood and Brenner can be read as a profound entente, no? If one considers the policy implications that follow from their causal theories of why the profit rate fell, leading to stagnation and misery, it seems to me that Crotty justifies labor's acceptance of great moderation in the wage struggle (something you have tagged Doug with here) while Brenner, whatever his intentions, has justified a form of import duty socialism. The entente takes the form of low wage mercantalism. I see no reason why it would be dishonest for Pat Buchanan to argue that his next presidential platform was indeed based on a careful synthesis of the the Crotty/Brenner theories.
By the way, you seem to be arguing that the rate of profit fell and will tend to fall even as the rate of exploitation rises; at the same time you seem to be suggesting that capital has achieved a sufficiently high rate of exploitation to ensure its expanded reproduction despite self correcting maldistributions of capital along the way. So aren't you also saying to the working class that acceptance of such a high rate of exploitation ensures a high enough rate of accumulation to maintain the demand for labor and avoid rising absolute levels of misery? Why don't conservative political conclusions follow from the 'rising exploitation' theory you are counterposing to Brenner's intl competition theory and Crotty's wage squeeze theory?
______________________ Fabian suggested a general view of bourgeois history:
Sometimes labor wins, sometimes capitals wins and now is capital's turn. __________________ What about an excluded middle here: mutual ruin if not in the convulsions of global economic crisis then surely in eco hell.
Yours, Rakesh