Economics

Where do profits come from?

How do capitalists make profits? An individual capitalist can profit by cheating, or by what orthodox economists call “technological rents” (the ability to charge a higher price for a distinctive product, or to command royalties). But that is no explanation for the whole capitalist class. The simplest form of capitalist profit is the financial capitalist lending money at interest. But that cannot be the basic form. Capitalists cannot live by lending at interest to each other any more than an economy can be built on people taking in each other’s laundry. The question is, how does the value of...

Grundrisse and wage-slavery

How can wage-labour reasonably be described as wage-slavery? If a worker makes a free contract, as an individual equal before the law, with an employer, isn’t that a fair day’s wage for a fair day’s work? Shouldn’t the word “exploitation” be reserved for exceptional cases where workers are exceptionally at a disadvantage in the wage-bargain, rather being the word being used (as Marxists use it) for all wage-labour? The Grundrisse, Marx’s “rough draft” of 1857-8, offers a faster-burning and more vivid first draft of the answers to these questions which Marx develops in Capital. In Capital, Marx...

A dialogue with the future

Native Americans and Native Australians were flummoxed when they saw European settlers buying and selling land. When the Russian revolutionary Victor Serge came to the West in 1936, he found it hard to explain to his 16 year old son, born and brought up in the Soviet Union, how big factories could be privately owned. “This big building then... does it belong to one man, who can do just what he likes with it? Does this shop, with enough shoes for the whole of Orenburg, belong to just one owner?” “Yes, son: his name is written there in lights. The gentleman probably owns a factory, a country...

Wages, Price and Profit

At the same time as he was readying Capital volume 1 for publication, Marx gave an exposition of his view on workers’ struggles over wages in a report (in effect a lecture) delivered at two successive meetings of the General Council of the First International, on 20 and 27 June 1865. The exposition was not published at the time. It was found and published only in 1898, after Engels’ death, by Karl Marx’s daughter Eleanor, under the title Wages, Price, and Profit (or in some editions Value, Price, and Profit). Some of the exposition is a summary of the arguments in Capital volume 1 (and useful...

Capital in the 21st Century

Economic inequality has increased. It is on a solid trend to continue increasing. The USA, the most unequal of the richer countries, may set a new historical record for income inequality by 2030, and other countries are following similar though not identical trajectories. So says Thomas Piketty in his book Capital in the 21st Century. It has been a best-seller in many countries, despite costing £30 and stretching to six or seven hundred pages. Politically, Piketty has been in the orbit of the French Socialist Party. He told an interviewer: “I never managed really to read [Marx]... Das Kapital...

The next financial crisis

According to the Financial Times (1 October), credit-card and similar debt in the UK has been soaring since late 2013, and “regulators fear banks have underestimated the potential losses they face from borrowers unable to make repayments on their loans and credit cards in a downturn. “The Bank of England says that in a hypothetical stressed economic scenario the UK banking system would suffer consumer loan losses of about £30 billion over the next few years, representing a fifth of consumer credit.” In late September Deutsche Bank researchers produced a report on ‘The Next Financial Crisis’...

Nine years on from the 2008 crash. Workers' Liberty 3/58

Download the PDF with graphics. The global credit crash of 2008 and the ensuing travails have produced delayed political effects. A shift to more right-wing, nationalist, and “identity” politics may move neoliberalism sharply to the right, or even explode it from within. The economic turmoil has also produced new life on the left, as yet on a low wattage. For those who fight for a cooperative commonwealth to replace the grey miseries of neoliberalism, or the brutalities of the more right-wing alternatives, there are three imperatives: to be inside the new left-wing surges, helping them or...

"Crisis and sequels" is out, September 2017

"Crisis and sequels", a book about the 2008 economic crash and its sequels by Solidarity and Workers' Liberty contributor Martin Thomas, is out now! It is published by the academic publisher Brill, so we can't distribute copies, and in practice they market it to university libraries. Please ask the nearest university library to get it. And use the "MyBook" link http://bit.ly/cs-mybook to get your own printed copy from an e-copy held at a university library where you have access. A library recommendation form is available at: http://www.brill.com/downloads/LR-form.pdf . Or you can press the...

Nine years on: the new left, neoliberalism, and the new right

Click here to download as pdf The global credit crash of 2008 and the ensuing travails have produced delayed political effects. A shift to more right-wing, nationalist, and "identity" politics may move neoliberalism sharply to the right, or even explode it from within. The economic turmoil has also produced new life on the left, as yet on a low wattage. For those who fight for a cooperative commonwealth to replace the grey miseries of neoliberalism, or the brutalities of the more right-wing alternatives, there are three imperatives: to be inside the new left-wing surges, helping them or their...

Rosa Luxemburg's "What is economics?"

The introductory section of the course on political economy which Luxemburg gave to the SPD Party School. Click here to download pdf .

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