S.Artesian
24th August 2010, 19:46
Ground rent that is...which to me, being from the good old USA, and a city boy at that, is the least interesting part of Marx's work... However, I decided to reread the sections on rent in Part 2 of Theories of Surplus Value, and of course vol 3 of Capital.
Why? Because when I first read them years ago, I remember disagreeing with Uncle Charlie, and being dissatisfied with his explanation. For one-- I thought it crept closely, too closely, to "scarcity" economics.
And two.... because rent is such a mis-used concept... with it informing the notion of imperialism, and the advanced countries as "rentier" capitalisms.
And three.... because it is associated with "monopoly" and monopoly is not what exists in capitalism, although I don't think Marx intended his analysis to support a notion of capitalism as a whole organized as a monopoly or sustaining itself through rent extracted, however primitively or sophisticatedly, from "non-capitalists" or "smaller-capitalists" or "less advanced" capitalists.
And four... because looking into the price of oil, the changes in the price of oil, rent is offered as explanation, and by someone whose work is really excellent in this area-- Cyrus Bina.
So... in TSV Marx says "The significant difference between agriculture and industry remains in that in the latter, excess surplus value is created by cheaper production, in the former, by dearer production."
In vol 3 he later states "The price of production of the worse soil is always the one regulating the market price."
His assumptions here are that we are dealing with a defined economic unit, where international trade, imports, are restricted. He explicitly refers to a scarcity in land, in land being scarce; in the constantly increasing demands of the population that requires the maintenance in production of the "worse soil."
Bina applies this to oil, arguing that 1) there is no monopoly 2) OPEC is not a production cartel. {I agree again, the cartel that did exist was the original"seven sisters" of oil companies and that fell apart around 1972} 3. But... remembering that "the high cost producer sets the market," the price of oil has to be high enough to sustain US oil production which he argues is the most costly in the world [that is an area for discussion, since direct lifting costs in the US onshore, as recently as 1996, were $3.42 a barrel for the 24 companies who report to the US DOE's Federal Reporting System [FRS].
Anyway, I am troubled by the scarcity argument, to say the least. Marx refers to the price and rent increases in England during the anti-Jacobin war of 1794-1815, arguing that it is the prime example of less fertile land being brought into production.
I think something else besides that is going on-- as the price increases 1) are a mechanism for accumulation, not just of wealth for landlords, but accumulation for [I]capitalist landlords, who, unlike their feudal forefathers, have to maximize their rents, which means increasing the territory from which they can aggrandize rent, which means... consolidating tenancies into bigger units to charge greater rent to capitalist-tenant farmers and 2) a not-so-primitive method of accumulation-- of offsetting the higher wages of English workers, and in particular, driving wages of agricultural workers to or below subsistence levels and 3) driving out marginal producers.
Do I sound confused? Well, yeah, I mean I took to Marx's discussions of value, of the metamorphoses of the commodity,its rotations between use and exchange like a duck to the proverbial water... but here I find myself paddling around like a duck in the soup.
So if anybody has some insights into this.... feel free... please.
Why? Because when I first read them years ago, I remember disagreeing with Uncle Charlie, and being dissatisfied with his explanation. For one-- I thought it crept closely, too closely, to "scarcity" economics.
And two.... because rent is such a mis-used concept... with it informing the notion of imperialism, and the advanced countries as "rentier" capitalisms.
And three.... because it is associated with "monopoly" and monopoly is not what exists in capitalism, although I don't think Marx intended his analysis to support a notion of capitalism as a whole organized as a monopoly or sustaining itself through rent extracted, however primitively or sophisticatedly, from "non-capitalists" or "smaller-capitalists" or "less advanced" capitalists.
And four... because looking into the price of oil, the changes in the price of oil, rent is offered as explanation, and by someone whose work is really excellent in this area-- Cyrus Bina.
So... in TSV Marx says "The significant difference between agriculture and industry remains in that in the latter, excess surplus value is created by cheaper production, in the former, by dearer production."
In vol 3 he later states "The price of production of the worse soil is always the one regulating the market price."
His assumptions here are that we are dealing with a defined economic unit, where international trade, imports, are restricted. He explicitly refers to a scarcity in land, in land being scarce; in the constantly increasing demands of the population that requires the maintenance in production of the "worse soil."
Bina applies this to oil, arguing that 1) there is no monopoly 2) OPEC is not a production cartel. {I agree again, the cartel that did exist was the original"seven sisters" of oil companies and that fell apart around 1972} 3. But... remembering that "the high cost producer sets the market," the price of oil has to be high enough to sustain US oil production which he argues is the most costly in the world [that is an area for discussion, since direct lifting costs in the US onshore, as recently as 1996, were $3.42 a barrel for the 24 companies who report to the US DOE's Federal Reporting System [FRS].
Anyway, I am troubled by the scarcity argument, to say the least. Marx refers to the price and rent increases in England during the anti-Jacobin war of 1794-1815, arguing that it is the prime example of less fertile land being brought into production.
I think something else besides that is going on-- as the price increases 1) are a mechanism for accumulation, not just of wealth for landlords, but accumulation for [I]capitalist landlords, who, unlike their feudal forefathers, have to maximize their rents, which means increasing the territory from which they can aggrandize rent, which means... consolidating tenancies into bigger units to charge greater rent to capitalist-tenant farmers and 2) a not-so-primitive method of accumulation-- of offsetting the higher wages of English workers, and in particular, driving wages of agricultural workers to or below subsistence levels and 3) driving out marginal producers.
Do I sound confused? Well, yeah, I mean I took to Marx's discussions of value, of the metamorphoses of the commodity,its rotations between use and exchange like a duck to the proverbial water... but here I find myself paddling around like a duck in the soup.
So if anybody has some insights into this.... feel free... please.