Carrol Cox wrote:
> I would like to see more discussion of the intersection and
> overlapping of bourgeios and marxist economic categories,
> but I don't quite see why it has (at least to begin with) to
> be cast in terms of who does what worse.
Conceptually, the basic similarities between bourgeios and marxist categories are fairly straightforward. The GDP is a bourgeios measure of annual production (output), that can also be seen as a compilation of factor payments (income) to capital and labor. ( I hasten to add that the bourgeios concept of labor differs markedly from that used by Marx.) Capital receives two kinds of payments from the proceeds when a product or service is sold: (1) funds to cover the part of its investment in plant and equipment used up in a production round, commonly called by bourgeios analysts return *of* capital, and (2) profits, money to pay taxes on profits, and interest payments to finance capital, called return *on* capital. Labor receives employee compensation, including fringe benefits. Together, these three categories, (1) depreciation (called capital consumption allowances in the GDP), (2) employee compensation, and (3) the various returns on capital, comprise GDP factor payments.
Marx uses a similar three category distinction to represent the value of output. Constant capital, which is the means of production used up in a production round, and surplus value accrue to the capitalist. Variable capital is the value of labor's share, or more precisely the value of productive labor's share (productive labor is labor that produces surplus value for capital). Marxian value categories correspond to, and can be measured by, the same raw data used to compile the GDP (setting aside, for our purposes, certain problems like those connected with transforming values into prices).
Of the three categories, both systems treat the depreciation of means of production in a similar way. Understand, depreciation is not a number given from business receipts, like wages paid or profits, but must be calculated, both by individual firms and by the gov't when it put together aggregate data. Individual firms use IRS depreciation rules to calculate depreciation. The gov't doesn't just add up the IRS data. Instead it creates a new number meant to reflect price and technological changes; i.e., what can be called economic depreciation, reflecting the replacement value of the asset being written off. This corresponds to what Marx means by circulating constant capital–the value of this part of capital advanced in production that adds only its value to output. So capital consumption allowances in the GDP can be taken as a reasonable proxy for the marxian concept of circulating constant capital.
But similarities end there. Conceptual measurement of the rest of the division between capital and labor is very different. Bourgeios analysts see the firm as composed of investors and employees (an individual, of course can be both an investor and employee), in which receipts appear as either profits to investors or compensation in one form or another to employees. Profits (and taxes on the profits, and interest payments) are simply that which is reported to the IRS. With one adjustment. When the gov't aggregates these data it adjusts reported profits to reflect its calculation of economic depreciation (since cash flow available to capital is both the return of and on capital–depreciation plus profits). If the govt's capital consumption number is less than the sum of business' reported depreciation, aggregate profits will be greater than reported profits, and vice versa. In any case, once depreciation is accounted for, all the rest of the product is considered employee compensation, including, for example 8 figure salary and benefits packages of corporate executives. As a result, employee compensation typically accounts for about 75%-80% of the gross product of nonfinancial corporations.
Marxian categories divide the product very differently. Productive labor's share is defined as its reproduction cost (social consumption needs). Once the depreciation of constant capital is accounted for, all else is surplus value, i.e., that over and above what is needed to reproduce productive labor. In Marx's day most of surplus value was realized in exchange as profits to capital. Today, surplus value pays the wages of a growing army of unproductive labor, the difference between the wages of productive labor and their subsistence needs (should wages exceed labor's subsistence), the costs of government at all levels, as well as the returns on capital recognized in bourgeios categories (which in fact comprise only a small share of surplus value now generated). It is clear then that marxian surplus value is much larger than bourgeios return on capital, and labor's share much smaller than employee compensation.
I'm painting with a broad brush here, but I want to interject one qualification on the marxian side. Actually those products or services that can enhance labor productivity and/or social development should be considered part of variable capital, not paid out of surplus value, even though they may be paid for out of tax funds and/or provided by government. Education costs are an example. General education both improves labor productivity and is part of an individual's social development. Marx explicitly included that as part of labor's subsistence needs. It doesn't matter if the education is provided for by gov't through taxes.
One other thing. GDP used to be called Gross National Product. But capital exploits labor on an international scale, and the name of the accounts has been changed to reflect that: GDP measures only the domestic production of US based capital, plus the production of foreign based capital within US borders. Foreign production of US affiliates, which has tended to be more profitable than domestic production, is not included in the US GDP.
I argue that the different approaches to the question of distribution result largely from a different view the labor market exchange. Marxists see it as an unequal exchange in which labor receives only its subsistence, while capital accumulates the surplus value created by labor. Bourgeios analysts see distribution as the result of payments to factors of production according to their contribution (their productivity). The differences lead to a very different focus for each and, of course, very different analyses.
Roger