why does capitalism have to be global?

[Remus Bleys]

Why does capitalism need to open trade borders globally? Why does it have to constantly expand, constantly update?
Also, I know the tendency of profit to fall is why capitalism fails annually, but why does this cause it to fail? Why aren't capitalists content with some profit, even though it is less than before?

[Skyhilist]

It's due to the things that drive/cause profit.

For example, suppose a new manufacturing machine is invented. It can take the place of millions of workers and the rich don't have to pay for it's labor. So they fire workers and replace them with it to make more profit.

Now there are more unemployed workers. This means more people struggling to even survive, which means less consumers, economic problems, etc. Capitalism has to expand to find new ways to profit, even while it continually perpetuates this problem each time it expands.

This is just one example though. There are many reasons.

[edwad]

sky said it pretty well, but i would say that his scenario only applies to an advanced capitalist system that has probably already expanded to a global level and is just looking to continue expanding. i think the easiest way to put it is that capitalism relies on the exploiting of resources, so capitalists want to expand to other countries that have more or different resources. I could be wrong though and making a similar mistake to that which I just accused sky of doing. either way, capitalism should be nuked ASAP.

[Venas Abiertas]

Crisis of overproduction.

Mechanization, assembly lines, multiple workshifts, access to credit, etc. allow the capitalist to produce far more than what he/she can sell locally, forcing the capitalist to continually look for new markets for the products. Eventually, even the domestic market becomes saturated so the capitalist must find new markets overseas.

Countries like the UK or the US use their military might to open up these markets by force, if necessary, but prefer to use "free trade" deals and other similar subterfuges to gain access to foreign customers.

[Remus Bleys]

Crisis of overproduction.

Mechanization, assembly lines, multiple workshifts, access to credit, etc. allow the capitalist to produce far more than what he/she can sell locally, forcing the capitalist to continually look for new markets for the products. Eventually, even the domestic market becomes saturated so the capitalist must find new markets overseas.

Countries like the UK or the US use their military might to open up these markets by force, if necessary, but prefer to use "free trade" deals and other similar subterfuges to gain access to foreign customers.

Then why don't they just produce less?

[synthesis]

Why does capitalism need to open trade borders globally? Why does it have to constantly expand, constantly update?
Also, I know the tendency of profit to fall is why capitalism fails annually, but why does this cause it to fail? Why aren't capitalists content with some profit, even though it is less than before?

Perhaps it might be better to ask - why wouldn't capitalists globalize, expand, and accrue money like they're scoring points in a video game? Unless I'm misinterpreting your question.

[Red Commissar]

Then why don't they just produce less?

Then they lose profits. Contraction in production is not actually all that good for a business, and it'll usually have ripple effects to other industries it is tied with. Say a factory making cars scales down production, this has effects on many other industries that feed into it, which in turn will have effects on industries that feed in to those. Workers are laid off which means spending in the area will probably see a hit, and then those businesses run into problems and that's another set of ripple effects. Consumption underpins the whole system- it's an important factor when GDP is calculated. All this leads back to Marx's view that overproduction is inherent in the way capitalism works, because there will always be a drive to overhaul, optimize, and expand production for more profits, even as said process ends up driving down the price of a good when supply goes to excess and leads to other problems.

This is why some cities have been hit real hard when an industry that underpinned its existence went out.

[Comrade Jacob]

It needs to constantly update so people don't catch up to their game. It needs to be global because imperialism is the hight of capitalism, they are desperate to rape the lands of their riches. They will not stop.

[Luisrah]

Well, a worker always recieves less money than the cost of what he produces.

Some product might cost 50 dollars (20 from the materials, 10 from the machine's usage, and another 20 to pay the worker), for example.
This means that while the product costs 50 dollars, the worker who made it doesn't have enough money to buy it.
This leads to overproduction. The company has to have a much larger range of consumers to be able to sell everything it produces (especially since people don't buy clothes, computers etc everyday of their lives).

This will lead to the growth of the company which will make it necessary to find an even bigger pool of consumers which will lead to more growth and so on...
Companies get so big that they have to go over borders to continue to expand and that's why the "free market" (meaning they get to sell their products wherever they want) is always being defended by them and the politicians they buy.
That's why the EU constantly removes barriers that block those companies from selling to other countries and it's one of the reasons why some of the smaller countries are in trouble. They recieved money from the EU to stop producing so that other countries could sell their products there.

This makes the small countries subordinate to those countries with a better economy.
And if I haven't made any mistakes, this is what is called imperialism or neo-colonialism.

[Thirsty Crow]

Note that these will be short answers attempting to get to the bottom of things, without any pretense to wide explanations.


Why does capitalism need to open trade borders globally?
Because the national market at one point becomes insufficient as a means of realizing the mass of surplus value - through sale. I think this relates especially to the production of the means of production.



Why does it have to constantly expand, constantly update?On expansion: expanding output of course expands profits, and technological progress tends towards the same outcome, through reducing the cost of production in terms of variable capital (wages) and enabling the expansion of output. One important thing to consider here is the fact that the impetus to technological improvement also comes from working class militancy (the ruling class might be compelled at one point in time to forward this as a strategy of combating workers' militancy and class composition)

Also, I know the tendency of profit to fall is why capitalism fails annually, but why does this cause it to fail?Not every contraction and crisis can be ascribed to the falling rate of profit in a straightforward way.


Why aren't capitalists content with some profit, even though it is less than before?Because the effects of global competition and dangers arising from the accumulation process (e.g. workers' militancy, costs of raw materials and so on) not only represent a threat against the rise in profits, but also a threat to there being any profits at all.


It needs to constantly update so people don't catch up to their game. It needs to be global because imperialism is the hight of capitalism, they are desperate to rape the lands of their riches. They will not stop.
Nice catch phrases. How about some analysis?

[Kingfish]

In addition to the very valid points raised here, one of the reasons it has been successful in fulfilling these structural needs is its extraordinary productive capacity which allows it to overwhelm competing systems forcing them adapt to capitalism or hold out until eventually capitalism is forced on them.

For a nice historical example take a look at how China and Japan responded to the threat the capitalist west posed to their way of life.

[Venas Abiertas]

Capitalism is aggressive by nature. It can't be otherwise. It's very existence is based on the idea of conquering and overcoming competitors and competing systems, in order to grow and thus maximize profits. Practically every other economic system that capitalism confronts for the first time will succumb to its pressures, for the same reason that a person becomes sick the first time they are exposed to a new disease.

This is my great fear for Cuba. If Raúl dies, and is not replaced by a strong and determinedly socialist leader, we could see a massive invasion of the island by predatory North American capital, along with its cultural products, political philosophies, and even religious sects that all promote the capitalist worldview. The Cuban people would be woefully unprepared to withstand the full onslaught of the "free market" system. Houses, beaches, fertile lands, and mineral resources could all be grabbed up before the people even have time to realize what is happening to them.

[Lord Hargreaves]

Then why don't they just produce less?

There is no possibility of this kind of coordination in capitalism... they can't all come together to decide to produce less.

If one capitalist just ups and decides to produce only a certain amount and no more, he will eventually find himself unable to compete in the marketplace as it develops (he won't have the money to plow back into investment to improve the product or cut the price, and other more profitable companies will be able to buy him out) and so will lose everything.

[Yuppie Grinder]

Capitalism adapts to the falling rate of profit by developing new markets.

[Lord Hargreaves]

Why does capitalism need to open trade borders globally?

Capitalism chases foreign markets in search of new consumers and new investment opportunities.

Levels of investment are broadly determined by expectations of future profit, so a falling profit rate can trigger a drop in the amount spent investing. This probably means the economy won't grow as it should, profits will be down next cycle, etc., creating a downward spiral.

When there is low business confidence, our governments can bypass the market and engineer "sure thing" investment opportunities themselves, doing so through imperialist war and the gigantic reconstruction and development projects that come with it (not to mention the huge demand increase for arm sales etc.)

New markets also allow the expansion of the global division of labour, which is absolutely critical to capitalism. Marxists understand this as the transfer of surplus value from the periphery (concentrating in simple labour and commodity production) to the core economies (where the money itself is invested or siphoned off as profit).

And finally, when a country develops to a certain point there will be an increased consumer base to buy goods and services, counteracting the tendency toward global overproduction.