Archive for the 'Economics' Category



The Mode of Production Debate in the Philippines

A Hacienda Luisita peasant plants rice in a freshly tilled field (Photo by Jack Stephens).

A peasant plants rice in a freshly tilled field in Hacienda Luisita, Tarlac, Philippines (Photo by Jack Stephens).

In her book on the Communist Party of the Philippines (MLMZT) author Kathleen Weekley briefly goes over a debate about whether the Philippines was really “semi-feudal” or more “capitalist” in nature:

The first substantial critique of this formulation from inside the national democratic movement came in the late 1970s from Rigoberto Tiglao, who presented a dependency theory perspective on the economy, concluding that concentration on the peasantry as the social base for the revolution was ill-conceived. The gist of his argument is that the Philippines is a “peripheral capitalist social formation” in the global capitalist order and was so even during the years of American colonialism. “It was precisely the capitalist means of production which made possible the transformation of Philippine agriculture into an export-producing sector.” Citing the extent of mechanization in key crop industries and the relationship of tenant farmers to the system of market forces, he concludes that “the ‘landlord class’ in the Philippines [is] more of an agrarian bourgeoisie” the biggest of whom ‘together with transnational corporations [control] the industrial component of the export industries…as well as the comprador enterprise.” the political aspects of peripheral capitalism have important implications for revolutionary strategy, Tiglao argued. “Limited sources of capital accumulation” he says, “result in explosive intra-elite struggles.” Martial law was imposed in order to manage these struggles, but it is not “semi-feudalism” that is the “social base of this fascism” as the CPP puts it. Rather, “the Philippine industrial bourgeoisie is the social basis of such political authority [and] rural and urban working class movements rapidly erode whatever level of stability such a centralized authority has achieved.” In other words, the CPP ought to concentrate its efforts on organizing and mobilizing working class resistance to the Marcos dictatorship, rather than organizing the “peasantry” into an army to fight a protracted war in the countryside, ignoring the real source of capitalist power.

In 1987, a Negros news magazine, Viewpoints, published an anonymous article criticizing the CPP analysis of Philippine society as “semi-colonial, semi-feudal.”…

The Viewpoints article countered that while a feudal superstructure remains on the island [of Negros], the economic base is largely capitalist. The crisis in the sugar industry, brought on by various factors including reduced demand from the U.S., plummeting world sugar prices, escalating production costs and shrinking domestic consumption, reached catastrophic proportions in the mid-1980s. That crisis, the Viewpoints author argued, has “shown that the sugar planters must bear the costs of production and are subject to the financial risks inherent in the industry. It follows, then, that the plantation workers cannot properly be regarded as “peasants.” While they labor on the land, the workers’ interests and aspirations are different from those of the peasnt.

“Given the choice between tilling his own land and working in a factory at satisfactory wages, it is highly probable that the farmworker would choose the factory job. (Weekley, 57-58)

When Jose Maria Sison, one of the founders of the CPP and its first chair, and latter a consultant for the National Democratic Front, got out of prison he delivered a series of lectures at the Center for Asian Studies at the University of the Philippines in order to answer these criticisms:

Agricultural land totaling 12 million hectares in 1980 is the principle means of production. It produces the food staples for domestic consumption, the overwhelming bulk of surplus products for export and some amount of raw materials for local processing.

There is negligible use of modern farm technology beyond peasant brawn, hand tools, plows and work animals on lands devoted to rice, corn and coconut, all of which comprise 90.4 percent ot total agricultural land. The promotion of costly imported farm inputs and equipment during the 1970s affected only a few hundred thousands of hectares. Estimates range from 500,000 to 800,000 hectares.

…No more than 4 percent of total agricultural land is worked by tractors and other farm machinery.

Every piece of modern equipment in the agricultural, Industrial and service sectors of the economy is imported. It is paid for with foreign exchange earned on raw material exports, mostly agricultural…

Even hand tools are imported to the extent of 85 percent. And of course, the remaining 15 percent are fabricated locally from imported metals. There are no well-established industries which produce from the available local raw material basic metals, basic chemicals, capital goods and the like.

According to NEDA figures, there were nine million peasants and farm workers, accounting for 52 percent of employment; 2.5 million industrial workers, 14 percent; and six million service sector workers, 34 percent, in 1979, which was a year of economic growth still bloated by excessive foreign borrowing.

These figures indicate, therefore, that peasants and farm workers comprise 78 percent of direct producers of goods and industrial workers 22 percent. There are four peasants for every industrial worker.

Only 74 percent of industrial workers are in manufacturing; and in turn 70 percent of workers in manufacturing are employed in small fabricating and repair shops, each employing less than ten workers and therefore hardly qualifying as truly manufacturing enterprises.

The figure for employment in the service sector is bloated by decreases of employment in the agricultural and industrial sectors during the 1970s. Agricultural employment went down from 59 percent in 1970 to 52 percent in 1979; and industrial employment from 17.6 percent in 1970 to 14 percent in 1979. The employment rate of the real producers of goods has decreased from year to year since 1979. (Sison, 81-83)

And while still in prison, earlier in 1982, Sison and de Lima (released around that time), wrote:

It is said that farm workers are now 55 percent of the farm population and are bigger in number than the peasants with definite plots to till…It is difficult to make a national survey distinguishing the farm workers who depend mainly or wholly on their wages and the poor and middle peasants who augment their income as farm workers. But assuming the figure is correct, it does not mean any significant advance into capitalism away from semifeudalism…it means that the semifeudal economy is bursting at the seams with surplus labor it cannot employ…

Land concentration mainly by landlords and semifeudal rich peasants continues. Foreign and local farm capitalists still have to deal with local owners of land. However, the new-type of landlords take the initiative of employing capitalist processes such as getting crop loans, using imported agricultural inputs, hiring farm workers, etc. (ibid., 49-50)

Sources

Anon. “The Negros Enigma.” Viewpoints 2, no. 15 (1987), reprinted in Diliman Review 36, no 4, quoted in Weekely.

Sison, Jose Ma. and Julieta de Lima. Philippine Economy and Politics. Philippines: Aklat ng Bayan, 1998.

Tiglao, Rigoberto. “Non-Progress in the Periphery.” The Diliman Review (1979), quoted in Weekley.

Weekley, Kathleen. The Communist Party of the Philippines 1968-1993: A Story of its Theory and Practice. Quezon City, Philippines: University of Philippines Press, 2001.

Marx and the Commodity Fetish

Capitalism

In the July 2009 issue of Rethinking Marxism John Lutz goes over Marx’s theory of commodity fetishism and how it relates to human relations and the human psyche in a capitalist society:

One of the central contradictions that Marx seeks to identify in his theory of commodity fetishism involves the extent to which capitalism, in inverse proportion to the extent that it expands the power of human beings over nature, disempowers individual subjects by subordinating them to the imperatives of capital.  While it appears to expand the sphere of human freedom, the concrete effects of the labor process lead to the economic and psychological diminishment of the majority in order to benefit the minority materially.  Marx’s theory of commodity fetishism is intended to expose the mystification of social relations in the commodity form as the basis for a bourgeois conception of autonomy that exists in the implicit contrast with its socialist alternative.  In this respect, the dual manifestation of commodity fetishism as a mystification of social relations promising power and fulfillment and its reality as a form of economic domination are fundamentally intertwined. (Lutz, 421)

Source

Lutz, John.  “A Marxian Theory of Subject: Commodity Fetishism, Autonomy, and Psychological Deprivation.”  Rethinking Marxism 21, no. 3 (July 2009): 420-34.

Information Capitalism

information technology

Christian Fuchs writes that despite all of the talk about living in a “post-capitalist,” “post-modern,” or “information society” we still live in a society that is dominated by the structures of capitalism and class divisions:

For describing contemporary society, Marxist scholars have suggested terms that focus on transformation of the productive forces, like digital capitalism…high tech capitalism…informatic capitalism…and communicative capitalism…I prefer such terms to radical discontinuous terms like information society or postmodern society because the first contain a critical negativity.  But they convey the impression that technology (digital, virtual, high technology) determines society: that is, that the relations of production are a linear result of the productive forces.  Change in contemporary society affects forces and relations, structures and actions, because society is based on a dialectical dynamic of these two qualities…

Concepts like knowledge, information, postmodern, postindustrial, Internet, and network society fail to grasp the dialectic of continuity and discontinuity of society.  They construct the changes connected to new media as radical novelties and ignore the continuing dominance of capitalist structures.  In order to stress that capital accumulation is transformed by the rise of knowledge and information technologies and the transnational spatial model connected to the flexible regime of accumulation, I have suggested using notions like transnational network capitalism, transnational informational capitalism, or transnational knowledge capitalism as key concepts for describing contemporary society. (Fuchs, 390, 399)

Source:

Fuchs, Christian.  “A Contribution to the Critique of the Political Economy of Transnational Informational Capitalism.”  Rethinking Marxism 21, no. 3 (July 2009): 387-402.

Jose Maria Sison on Globalization

For Democracy and Socialism Against Imperialist Globalization

In October of 1998 founder of the Communist Party of the Philippines (MLM) and political consultant to the National Democratic Front of the Philippines, Jose Maria Sison, wrote:

In the name of promoting economic growth and preventing inflation, monopoly capitalism has used its imperialist state to trample upon the hard-won rights of the proletariat, bring down the wages and living conditions of the people, provide tax cuts to the monopoly firms but raise taxes on basic consumer goods and services and cut down government spending for social benefits and social services.  It has done so to accelerate the accumulation of capital, maximize profits and counter the general tendency of profit and growth rates to fall in the imperialist countries. (Sison, 138)

Source

Sison, Jose Maria.  Selected Writings of Jose Ma. Sison, 1991-2009, Volume 2: For Democracy and Socialism Against Imperialist Globalization.  Philippines: Aklat ng Bayan, Inc., 2009.

Marx and Mode of Production and Social Formation Theory

The Third International Comintern where some of the MPSF theory was hammered out.

The Third International Comintern where some of the MPSF theory was hammered out.

Erik K. Olsen writes about the historical formation of Mode of Production and Social Formation Theory (MPSF):

Looking beyond the Preface [to A Contribution to the Critique of Political Economy] to other parts of Marx’s mature writing, the claim that MPSF accurately represents Marx’s theory of society and history becomes even more difficult to sustain because the theory is plainly incompatible with them.  In the introduction to the Grundrisse (1973), for example, Marx describes the relationship among various aspects of the economy and society as “organic,” and his historical analyses illustrate this.  Marx’s nuanced and multifaceted discussion of the development of capitalism in Britain in volume 1 of Capital (1967, pt. 8), for example, would be irrelevant if he hled a view of society and social change based on a simple expressive totality.  Instead, the three basic sociological laws of MPSF theory imply that a history of technology would be sufficient to describe the origins of capitalism in Western Europe.  The analysis Marx does provide would not only be unnecessary, but it would distract attention from the prinum agens.  Marx’s writing on the prospects for changes in class relations in nineteenth-century Russia (collected in Shanin 1983) provide another, similar counterexample.  In neither case does he approach the question from the perspective of how the social structure conforms to the necessity imposed by production technology.  Instead, he analyzes these situations in terms of the complex set of forces and factors that contest and shape one another…The basis for the expressive-totality ontology in Marxist theory is found not in Marx but rather in Engels.  (Olsen, 183)

Source

Olsen, Erik K.  “Social Ontology and the Origins of Mode of Production Theory.”  Rethinking Marxism 21, no. 2 (April 2009): 177-95.

Althusser and Marx’s Value-Form Analysis

Marx

John Milios writes in this quarters Rethinking Marxism that the:

prevailing Marxist tradition portrays Marx‘s value theory as a continuation and completion of the classical labor theory of value, specifically in the version formulated by David Ricardo [1772-1823]….

In the context of this tradition, value is defined as the quantity of (socially necessary) labor contained in a commodity, and surplus value as the quantity of labor appropriated by the ruling classes…But there is a an alternative Marxist tradition that comprehends value and surplus value as historically specific social relations: namely, as the specific form assumed by economic relations, exploitation, and the products of labor in societies based on commodity production (i.e., capitalism).  This alternative tradition emphasizes Marx’s analysis of the value form and the money, above all in section 1 of volume 1 of Capital, an analysis that seems to have been neglected by all “classical” approaches to Marxian value theory. (Milios, 260)

Louis Althusser (1918-1990) himself also saw value as apart of social relations and understood Marx’s concept of value as seen in Capital: Volume 1.  But, at a certain point in volume 3 of Capital Marx seems to mix these two distinctive features by trying to compensate his theory of value in volume 1 with some way to measure it in volume 3:

Marx’s monetary theory of value demonstrates that value and price are not situated at the same level of analysis…

Nevertheless, at certain points in volume 3 of Capital (especially when dealing with the ‘transformation of values into prices of production’), Marx distances himself from the implications of his own theory…making quantitative comparisons between values and production prices. (267)

(All though, and I forget where I heard this, I believe it was during one of David Harvey‘s lectures, that Marx wrote Capital in reverse; starting with volume 3, then 2, then 1, and then editing it by starting with volume 1.  Which is why I believe Marx’s theory is more developed in volume 1 then in volume 3 and if he had lived to finish his series [he was notorious for not completing his works] he might have developed his theory of value more in relation to volumes 1 and 3.

Also, Marx’s theory in volume 3 was developed quite a bit by Engels in his edition, which one can see between the Marx-Engels Gesamtausgabe edition and Engels’ edits.)

Althusser, while grasping this concept:

did not systematically question the concept of value per se…He presented Marx’s break with Ricardo primarily in terms of the fact that the latter was not able to analyze the class relations determining the commodization of labor power…(270)

Source

Milios, John.  “Rethinking Marx’s Value-Form Analysis from an Althusserian Perspective.”  Rethinking Marxism 21, no. 2 (April, 2009): 260-74.

Capitalist Economists

William Gropper, "Black Thursday"

William Gropper, "Black Thursday"

In the June issue of the Monthly Review sociologist Richard York, et. al. explain:

Bouchaud penetratingly observes, “The supposed omniscience and perfect efficacy of a free market stems from economic work done in the 1950s and 1960s, which with hindsight looks more like propaganda against communism than plausible science.” The capitalist ideology that undergirds economics in the United States has led the profession to be detached from reality, rendering it incapable of understanding many of the crises the world faces. Mainstream economics’ obsession with the endless growth of GDP—a measure of “value added,” not of human well-being or the intrinsic worth of ecosystems and other species—and its failure to recognize the fundamental ecological underpinnings of the economy, has led to more than simply an inability to perceive the deterioration of the global environment. In fact, the problem goes much deeper. Orthodox economics, like the capitalist system that it serves, leads to an “Après moi le déluge!” philosophy that is anything but sustainable in orientation.

Sources

Bouchaud, Jean-Philippe.  “Economics Needs a New Scientific Revolution.” Nature 455 (October 30, 2008).  Quoted in “Capitalism in Wonderland.”

York, Richard, et. al.  “Capitalism in Wonderland.”  Monthly Review.


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