No, sorry, maybe Robert Brenner is pulling this info together? I only know South Africa dynamics. It's a revolting tale, full of rich white swine decapitalising industry/mining, and running their apartheid-era funds into numbered accounts across the world's offshore banking centres (see Elite Transition, from Pluto, 2000, for gory details). On the real side, we've had net foreign direct disinvestment since liberation in 1994, plus on the financial side, terrible portfolio tidal waves in and out, with three episodes ('96, '98 and '00) of 25% currency crashes.
> a firm like
> Ford that finances purchases of its own vehicles is capturing profits
> its bankers would have gotten in another era,
Hang on, last I checked (ok, 11 years ago when I wrote a piece on this for Multinational Monitor), Ford's financial-sourced profit stream wasn't impressive from vehicle financing (they did interest rate discounts to help move their stock), but instead came largely from Nationwide S&L (is that still the US' largest home mortgage depository institution?)... like GM did with GMAC's massive augmentation of car-financing to home mortgage securitisation, around the same time. Isn't this the issue we're concerned with? (I recall a guy called Chris Niggle doing a paper on this topic in the late 1980s, and surely Robert Pollin has been doing updates on hollow-corporate profit streams?)
> and financial profits
> are redistributions from profits of production
No, Doug, not if those profits are acquired simply through M-M', i.e., money blowing out of and into a speculative bubble, right?
> so you could still
> say that the overall rate of profitability of U.S. capital is
> substantially up over the last two decades.
Well sure, we can say that whenever there's a profitability problem, you find capital frantically invoking countervailing tendencies (not just relative and absolute surplus-value extraction, but a whole range of tactics to move the overaccumulation problem around through time and space). What is more interesting is whether higher rates of overall US corporate profitability -- esp. at a time when the wage share is rising again after the 1975-95 crash -- are truly a function of surplus-value extraction, or whether the profits are partially (and increasingly) bogus, based on the Ponzi pyramid scheme known as the US financial system.
> > and b) doesn't this
> >upturn still fall far short of Golden Age profitability?
> Not far short, but short, yes. But a lot higher than 20 years ago.
> > (And didn't
> >it leave the rest of the world behind during the late 1990s
> >volatility and general slowdown?)
> Japanese profitability is in the tank, but EU profits aren't. They're
> not as buoyant as U.S. profits have been, but they're not in a
> Japanese funk, either.
Damn it, Doug. That's why people accuse you of never leaving the Upper West Side. I said "rest of the world" and you gave me a tiny corner characterised by hedonistic consumption norms and malevolent geopolitical power. Come around to Johannesburg and I'll show you a national per capita standard of living that today is precisely where we were in 1961. And there's far worse decline just north of here.
> >If you check Wall Street (new edn), pp.73-77, you
> >find that new capital spending by US nonfinancial
> >corporations declined from levels in excess of 8.5% of
> >GDP during the 1950s-60s, to less than 7% during the
> >1970s, to 4.7% during the 1980s, before recovering
> >slightly to 5.3% from 1990-97.
> You're averaging the 4.5% figure for 1990-94 and the 6.2% for
> 1995-97, right? Several problems - one being that the first is a
> five-year period and the second is a three-year;
That makes my case even stronger.
> two, the 6.2% isn't
> far below the 6.8% average I show for the entire 1952-97 period;
So? There are always little upticks within a broad cycle. The point is that 1952-70 was a high investment era, and the 1980s-90s was a sickly period, off from the earlier 8.5% range to around 5%. Can't we talk in terms of an era (even if decade isn't the right unit of analysis) in relation to the accumulation process? I think, based on these simple data (which I'd guess are pretty typical of world-economy investment rates), that the economic logic of US fixed capital investment declining from Golden Age peaks is impeccable, and we should face up to that.
> three, the data doesn't include 1998-2000, which were pretty good
> years;
(Loosely corrected in my averaging.)
> and four, these whole series was rendered obsolete with the
> latest NIPA revisions, which, among other things, now class software
> purchases as investments rather than current expenditures (which
> seems pretty right to me).
Really? I thought your book on the New Economy fetish will debunk the idea that there would be enormous surplus-value-extracting gains from the latest (quickly-obsolescent) software. I wouldn't contest that s.v. gets extracted in more innovative ways through CAD and other technical innovations, but still, for these kinds of longer-range comparisons (over decades), isn't it fair to compare apples and apples? So adding a new investment category, software, as if it were uniformly the same kind of investment as, say, a machine tool, seems dubious, no? (And have earlier investment data, dating to the 1970s, been corrected to account for the new definition?)
> I never said the rentiers weren't doing well.
So, what does that tell you about the character of the accumulation process these past two decades, Doug? Sustainable?
> >As for the replacement of internal revenue streams for
> >debt more generally, the US ratio of all forms of credit
> >market debt to GDP was fairly stable, in the 130-150%
> >range from 1950-1975. It then soared to 250% over the
> >next two decades.
> We were talking corporate, not personal, debt, so now who's
> aggregating excessively?
Same trend line, right? Anyhow, the point about credit is its role (whether corporate, consumer or even state-related debt) in displacing the overaccumulation problem across time, so you pay later for mopping up excess production now.
> It seems that corporate borrowing is more likely to go towards
> funding "financial" activity, like takeovers and buybacks, while real
> investment is internally funded. So debt is less a matter of
> replacement than supplementation.
But higher corporate debt bought back equity in a context in which P/E ratios were, through the 1990s, at historic highs. It's still a speculative-cum-Ponzi phenomenon (in the strict Minskyian sense), no?
> The chart on p. 324 of Wall Street, which is where I'm guessing you
> got the first column (real long-term bond rates), shows that in the
> second half of the 19C, real rates were 5% or higher, which was a
> time of high - excessive even - real investment.
But comparability? Accumulation in the late 19th century US entailed extraordinary unevenness, with the rise of the corporate form, the beginnings of massive centralisation and concentration of capital in key manufacturing and financial subsectors, periodic bank failures (maybe justifying the relatively higher risk associated with lending/borrowing money), and indeed periodic system-wide crashes until JP Morgan established the Fed in 1910 as a bailout mechanism. It was, as Hilferding described it, a period of immaturity, and I don't have the historical background to extend the theory of accumulation back that far. (I've tried to do so here in SA, in an article called "A history of finance and uneven development in South Africa" which I'll send you offlist.) But I think the theory applies; both because Christian Suter's 1992 (Westview) history of debt cycles runs back that far, and because Simon Clarke's (1988, Elgar) study of Keynesianism, Monetarism and the Crisis of the State also puts the overaccumulation+financial phenomena into cyclical perspective, going back through the 19th century (if I recall correctly).
But I'm glad history's on your agenda. Let's do geography too.
> Hmmm, I get nervous when women and the environment are mentioned in
> the same breath. I get in trouble whenever I say this, but you could
> argue that women are better off for entering the paid labor force
> than they would be staying at home with the family. So while they
> enter "exploitation" in the Marxian sense, they may perceive their
> lives as having improved somewhat. And in the First World, I don't
> think there's much doubt that most women are better off in 2001 than
> they were in 1951.
This is trouble, Doug. I'm just looking at the excellent book by Robert Biel, The New Imperialism (Zed, 2000), which has a good rap on unremunerated labour and the "partial monetarisation of the periphery" which means that for most women, the 1970s-90s international economic crisis has made things worse. Biel talks about "women's labour not being modernised in the sense of abolishing the old determinants, but the old forms of exploitation have been supplemented by new ones. In effect, an attempt to `empower' women (which means developing their initiative enough to make it easier to exploit them) has been grafted on top of basically unchanged relationships."
I'd go further, to look at the ensemble of problems associated with urban deindustrialisation plus multiple rural crises in Southern Africa, and as a result, the amplification of what the neo-marxists here used to call the articulation of (capitalist/pre-capitalist) modes of production. There's still a massive amount of labour within this region still bound up in migrant traditions, and as industry and mining wither away, urban survival is being achieved only through new kinds of rural-urban surplus flows (maize is brought into Harare, for instance, when newly-unemployed urbanites return from a rural visit, because it's so expensive in town now).
Those dynamics make women (who stay in the countryside, rearing kids, looking after sick workers and taking care of the elderly, because capitalists and states don't want to pay for labour-power's reproduction if super-exploitable women will do it for free) all the more prone to multiple oppressions. AIDS is of course the main and most immediate, life-threatening crisis (now 4.2 million HIV+ cases in South Africa). But to make the point about migration all the more urgent, looking at today's Jo'burg newspapers I see that the 12,000 cases of cholera in the KwaZulu-Natal province (beginning in August 2000)--where Zulu-speaking migrant workers went home to in December for the annual month-long break--have rebounded here in Jo'burg, as (women) domestic workers are bringing the disease into the bourgeoisie's very homes.
What's the point? The reason for the cholera outbreak was that poor households couldn't pay their rural KwaZulu municipality a new $6.80 connection fee, and so heartless bureaucrats cut their supply off, so more than 1,000 households were forced into dirty rivers for their water/sanitation, and things spread rapidly from there given the lack of reticulated water systems in the vicinity. Now, the reason the water supply was cut off was very obvious: the bureaucrats were under explicit pressure from higherups, who in turn were enforcing a set of World Bank-designed development policies, including macroeconomics, infrastructure investment, rural development and even water pricing, in which the WB claimed in its 1999 Country Assistant Strategy it played an "instrumental role" -- including the insistence on vigorous water cutoffs.
So, in these very explicit ways, I get reminded all the time of how the global economic slowdown from the 1970s (and consequent dramatic decline in price of all SA's export commodities), the international rise of financial power during the 1980s-90s, the viciousness of the Washington financial-policing agencies' neoliberal ideology, the repeated contagion of financial crises to South Africa these past five years, the quarter-century long organic overaccumulation problem here in SA, and so forth and so on, are all bound up in capitatist crisis formation and displacement. So what looks to you, Doug, like sustainable, vibrant, energetic, and dynamic NY-centred capitalism (until very recently) sounds to me, instead, like a giant sucking sound. Come round to Jo'burg this year and we'll do some touring of those articulations of modes of production, and you'll be more sympathetic to the merits of crisis theory. Jo'burg was just named as the site for the Rio+10 conference ("World Summit on Sustainable Development") in 2002: what an appalling irony. Come, let's make a mess of that conference, the way They do of our lives here.