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22nd June 2014, 17:25
Hi there,
I'm in the early stages of getting to grips with Marxian analysis, and I find that often things become clearer when they are applied to things happening in the contemporary world.
With this in mind, I've been looking into the divergence between increases in productivity vs. worker compensation (otherwise known as 'decoupling'). The graphs that I and seen up to now seemed to show a direct confirmation of Marx's thesis on the relative impoverishment of the working class (rather than the absolute impoverishment that he is so often credited with), insofar as they are receiving a smaller and smaller chuck of the increases in productivity over time. I'm sure most people here have seen them too, they look something like this:
nytimes. com/imagepages/2011/09/04/opinion/04reich-graphic.html
Having researched this a bit deeper however, it appears that things are not so clear cut. Rather than being a simple competitive cash grab by those who own the means of production (in order to remain competitive), the division shows itself as a division within the 'working class' itself (more on this later), between those at the higher end of the income bracket and those at the bottom.
That is, what the statistics (livingstandards. org/wp-content/uploads/2012/02/Decoupling-of-wages-and-productivity.pdf) show is that while decoupling does occur with regard to median wages (so called gross-decoupling), average wages do in fact track the increase in productivity (and thus the relative proportion of the GDP spent on wages has remained constant). There is a nice summary of all this here: oecdinsights. org/2012/02/20/do-workers-reap-the-benefits-of-productivity-growth/
As I understand it this is problematic for Marx, insofar as although the bankers, lawyers, and advertising gurus are no doubt responsible for the average wage keeping track of productivity (i.e. they are taking that section of increased productivity that would proportionally speaking (i.e. not in real terms) been passed on to the worker in the past), they nonetheless cannot be said to own the means of production as such. That is they may work for HSBC or whoever, and be paid ludicrous amounts of money, but they themselves are not directly exploiting labour in the way that a factory or call centre owner is.
The question is, I guess, how do we separate these people from the working class proper, since they are still workers? We can't just base the distinction on income as that just begs the question. Even saying that their exploitation in indirect - insofar as the higher income brackets are far more likely to be heavily invested in various equities - doesn't really work as even the working class in the west is 'indirectly' involved in such exploitation, since many of our savings accounts and pension plans (even state run ones) take advantage of investment returns, not to mention the cheap oil, goods and services that come from all over the developing world (Nigeria, China and India for instance) - sweat shop exploitation that we all 'indirectly' participate in.
I hope this isn't misinterpreted, I genuinely want an answer - inequality and exploitation is an obvious problem - but I'm just questioning whether an interpretive framework based on the question of the ownership of the means of production is sufficient to explain the split in worker salary. Perhaps it is just that the higher income brackets provide services that are directly helpful in sustaining the status quo - but even so, that certainly seems to muddy the waters in terms of the relative impoverishment of the working class over time, and is no way near as clear cut as the gross-decoupling charts would have you believe.
Finally, here is a nice patronising response to this issue from the good old LSE, which was the driving incentive behind me trying to find an adequate reply: blogs. lse. ac. uk/politicsandpolicy/wage-growth-productivity-van-reenen-pessoa/
Any suggestions will be gratefully received.
I'm in the early stages of getting to grips with Marxian analysis, and I find that often things become clearer when they are applied to things happening in the contemporary world.
With this in mind, I've been looking into the divergence between increases in productivity vs. worker compensation (otherwise known as 'decoupling'). The graphs that I and seen up to now seemed to show a direct confirmation of Marx's thesis on the relative impoverishment of the working class (rather than the absolute impoverishment that he is so often credited with), insofar as they are receiving a smaller and smaller chuck of the increases in productivity over time. I'm sure most people here have seen them too, they look something like this:
nytimes. com/imagepages/2011/09/04/opinion/04reich-graphic.html
Having researched this a bit deeper however, it appears that things are not so clear cut. Rather than being a simple competitive cash grab by those who own the means of production (in order to remain competitive), the division shows itself as a division within the 'working class' itself (more on this later), between those at the higher end of the income bracket and those at the bottom.
That is, what the statistics (livingstandards. org/wp-content/uploads/2012/02/Decoupling-of-wages-and-productivity.pdf) show is that while decoupling does occur with regard to median wages (so called gross-decoupling), average wages do in fact track the increase in productivity (and thus the relative proportion of the GDP spent on wages has remained constant). There is a nice summary of all this here: oecdinsights. org/2012/02/20/do-workers-reap-the-benefits-of-productivity-growth/
As I understand it this is problematic for Marx, insofar as although the bankers, lawyers, and advertising gurus are no doubt responsible for the average wage keeping track of productivity (i.e. they are taking that section of increased productivity that would proportionally speaking (i.e. not in real terms) been passed on to the worker in the past), they nonetheless cannot be said to own the means of production as such. That is they may work for HSBC or whoever, and be paid ludicrous amounts of money, but they themselves are not directly exploiting labour in the way that a factory or call centre owner is.
The question is, I guess, how do we separate these people from the working class proper, since they are still workers? We can't just base the distinction on income as that just begs the question. Even saying that their exploitation in indirect - insofar as the higher income brackets are far more likely to be heavily invested in various equities - doesn't really work as even the working class in the west is 'indirectly' involved in such exploitation, since many of our savings accounts and pension plans (even state run ones) take advantage of investment returns, not to mention the cheap oil, goods and services that come from all over the developing world (Nigeria, China and India for instance) - sweat shop exploitation that we all 'indirectly' participate in.
I hope this isn't misinterpreted, I genuinely want an answer - inequality and exploitation is an obvious problem - but I'm just questioning whether an interpretive framework based on the question of the ownership of the means of production is sufficient to explain the split in worker salary. Perhaps it is just that the higher income brackets provide services that are directly helpful in sustaining the status quo - but even so, that certainly seems to muddy the waters in terms of the relative impoverishment of the working class over time, and is no way near as clear cut as the gross-decoupling charts would have you believe.
Finally, here is a nice patronising response to this issue from the good old LSE, which was the driving incentive behind me trying to find an adequate reply: blogs. lse. ac. uk/politicsandpolicy/wage-growth-productivity-van-reenen-pessoa/
Any suggestions will be gratefully received.