> Roger Odisio wrote:
>
> >Doug Henwood wrote:
> >
> > > Has the rate of profit hit 0 yet? I keep waiting....
> >
> >I suppose you're waiting Doug because you think Marx's the law of the
> >tendency of the rate of profit to fall was a prediction of what will
> >happen to published profit rates.
>
> I've read accounts of Marxian rates of profit too. Shaikh says the
> U.S. rate is going up.
But I repeat, for Marx, the tendency for the FROP is not a prediction about movements in observable profit rates, whether Shaikhian calculations or bourgeois. The tendency of the FROP is "just another expression for the progressive development of the social productivity of labor" in the industrial capitalism of his day. In its thirst to grow, industrial capital tries to expand surplus value by means of the progressive mechanization of production, narrowing the base of productive labor that produces surplus value. Further, technology and innovation are weapons used by capitalists in the class struggle over relative shares. FROP is, he says, a tendency inherent in the self expansion of capital.
But Marx considers the FROP only a tendency because, as you suggest, he lists 6 counteracting tendencies to its operation. The most important of these are (1) raising the rate of exploitation: manipulations desigend to transform as much as possible a given amount of labor into surplus value, and (2) the cheapening (reduction in value) of the means of production.
Was Marx right about the industrial capitalism of his day? Is that the way it works today? Capital confronts contradictions, surmounts crises, only to face new contradictions. Times change. Ways to create and realize surplus value change. Whatever answers you give those questions, and there's lots of room for debate, it is clear that Marx's list of counteracting causes was just a starting point for understanding today. Marx posited the FROP as an historical law specific to the particular material conditions of his day. It is alien to his historical method to suggest that such an answer could be abstractly given for all time.
In any case, when discussing Marx's FROP those are the right questions to ask, not what is the latest squiggle in nonfinacial corporate profit rates, adjusted to reflect the worldwide production of US based capital (a rate which no one has, btw, because data on foreign gross product of US corporate affiliates does not exist in proper form to add to domestic gross product).
In short, I'm trying to get you to focus on process (the capitalist laws of motion) and all you want to talk about is outcomes (profit rates)! As you know, Doug, all life is process; outcomes are but transitory moments within a process. Consider the inscription over the dressing room door at Wimbledon (paraphrased): oh, to have the wisdom to face those twin imposters, victory and defeat, and treat them the same. And go on to the next match.
> I confess I find the whole FROP theory - at least the kind based on
> the rising OCC - completely mystical and largely useless. The
> "countervailing tendencies" Marx identified have largely done their
> work. I'm happy to listen to arguments to the contrary, but I've yet
> to be convinced.
Here is an example of what I am talking about. You write about an outcome--FROP is useless presumably because you don't see evidence of profit rates falling. And you conclude that's because the countervailing tendencies have presumably won out. Game over.
So you think the FROP tendency has disappeared? Means of production, technology, are no longer substituted for workers as a way to expand surplus value? Or is it that other ways to expand surplus value have grown in relative importance, and in some cases togeher with the cheapening of that technology have served to maintaining profit rates? Perhaps. Think about all the ways surplus value is created, relative to the cost of necessities for labor, and what forms it takes in realization--i.e., when you come to see it in published data. There is something to both points and there is a lot of analysis that can be done with those details.
Point is, claims about the movement of published profit rates, in either direction, are neither confirmation nor refutation of the tendency for the FROP as posited by Marx.
RO