www.geocities.com/CapitolHill/Lobby/2379/liquid.htm
Excerpt below from Loren Goldner at above site; Brenner cites an unpublished paper of Goldner's and thanks him for discussion. There are indeed some striking overlaps. _______________________________________
What distinguishes a Marxian analysis of "international liquidity", etc. from all other approximations of the same "elephant" is the assertion that the ficticious "totem", the bubble of "hot air" which circulates today as the trillions of dollars making up the "dollar overhang" held by foreigners, has its origins inside the "closed system" of capitalists and wage laborers.
Capitalist practice, once again, knows nothing of our categories of analysis. It knows a "capitalization" of assets that produce a cash flow of profit, interest and ground rent. (A "capitalization" is a multiple of the cash flow generated as profit, interest, etc. by an asset, set against the general rate of profit. A bond producing $5 of interest annually in an environment where 5% is the generally available rate of profit is therefore "worth" $100.). A slum tenement or decrepit factory is similarly "worth" a capitalization of its net surplus cash flow. Such a capitalization is "ficticious", in our language, because the "net worth" of an asset over long periods can have little or nothing to do with the real social cost of reproducing it. Such capitalized "price" and true social reproductive value only "coincide" in reality at the pit of a depression, the same shakeout of ficticious value of which we have had a foretaste in the past months (or more accurately since the July 1997 devaluation of the Thai baht). Bringing "capitalizations" into line with the actual available surplus value is another way of stating the problem of "fictions" with which we began.
"Inside" the "pure" (vol. 1 and 2) system of only capitalists and wage laborers, the original ficticious bubble appears in these capitalizations of fixed assets which are steadily devalued by advancing labor productivity (the real cost of reproducing those assets) spurred by competition but which, because of the anarchic nature of the system, are not regularly devalued to reflect increased productivity. Rather, they demand valorization at the prevailing rate of profit, calculated on a capitalization basis of cash flow, regardless of the underlying real material reproductive values involved.
This initial ficticious increment of capitalization, however, circulates far beyond the "pure" system, stretches the "elastic band" of the total production process far beyond the "closed" world of only capitalists and wage laborers, through CREDIT. Through credit, the initial overvalued fixed assets generated in the sphere of production itself circulate and become indistinguishable from similar capitalizations of interest, rent, etc. and all the other instruments through which the total cash flow, and therefore part of surplus value,is tapped. Through the system of international loans, ultimately underwritten by state debts and the power of the state to tax, the fictive bubble originating in the sphere of production circulates globally as long as it can be "valorized" through a surplus generated somewhere in the system. When it cannot, we have the situation in which we find ourselves today, which is in reality a situation that has been growing ever more dangerous for 40 years by ever-greater credit expansion and wage-gouging to keep the fictive values afloat. Just as in Marx's time, when "M. le Capital and Mme. La Terre danced their macabre dance", so in ours, the valorization of stocks, bonds, deeds, "derivatives", and the like must at all costs continue, however many Indonesias, Thailands, Brazils, Koreas, Mexicos and Russias are devastated in this latest version of domination of the dead over the living.
Many aspects of the above suggest themselves for special focus, and cannot be settled here : 1) the specific liquidity situation in Japan, particularly in the banking system, 2) the possible meaning of the "return to Keynes" currently being mooted by the dominance of "center-left" governments in Europe, i.e. the possibility of reflation 3) the question of the "euro" and world liquidity, 4) the Asian crisis, 5) the recent slowdown in China, and the possibility of a Chinese devaluation (currently on hold because of the strengthened yen) 6) social resistance to austerity in different parts of the world, 7) the prospect of a "new Bretton Woods" and the possible role of the phony left in bringing it about 8) the rivalry of the three major trading blocs, as expressed through currency crisis (such as the recent revaluation of the yen) 9) the squeeze on working class incomes through the pressures of the real estate market (i.e. rent) when ficticious capital has become so preponderant over productive investment. 10) the question of dollar-denominated international liquidity in the era of deflation we are entering as opposed to the era of inflation we are exiting.
These are merely questions that occur to me, but others will have other questions. None of these are, in my view, an academic exercise, but a step toward developing strategic and tactical perspectives for intervention the coming years. Nevertheless, I will conclude with some ways in which I think the perspective outlined above will become the practical concern of a movement to end capitalism