Has the crisis divided the capitalist class?

[Psy]

It looks like the capitalist class has divided the capitalist class (more then usual). Financial capitalist has mostly used their bailout to hostilely take over other finical capitalists all while the bourgeoisie states drag their feet on dealing with floundering capitalists in the productive sectors. It seems each group of capitalist in this crisis are only out for their own interests and don't seem to be currently thinking about the survival of the capitalist class as a whole.

[KurtFF8]

The capitalist class is always divided in some aspect as it competes with itself (or better worded: those within the capitalist class compete with each other) in the pursuit of profits.

But I would certainly not say that they are too divided right now:
http://politicom.moldova.org/stiri/eng/165265/

[Psy]

The capitalist class is always divided in some aspect as it competes with itself (or better worded: those within the capitalist class compete with each other) in the pursuit of profits.

But I would certainly not say that they are too divided right now:
http://politicom.moldova.org/stiri/eng/165265/


The G20 proved while capitalists states are willing to work together they have no grand strategy to even slow down the collapse of global markets. Also the fact that capitalists states were willing to throw money at financial capitalists while are giving manufactures a hard time shows that capitalist states are unwilling to shift the balance of power back to manufactures in order stabilize markets. The bourgeoisie states are not willing to sacrifice financial capitalists (that doesn't generate capital) to save capitalism (at least in the short term).

They could end the crisis tomorrow by giving the big 3 automakers $700 Billion (no string attached like they gave the banks) as bailing out manufacturing would change the problem to one of stagnating profit rates rather then one of a falling rate of consumption. For capitalism as a whole it really doesn't matter if all the financial capitalists all go bankrupt but if productive capitalists don't exploit surplus value out of workers then capitalism can't survive.

[zimmerwald1915]

They could end the crisis tomorrow by giving the big 3 automakers $700 Billion (no string attached like they gave the banks) as bailing out manufacturing would change the problem to one of stagnating profit rates rather then one of a falling rate of consumption. For capitalism as a whole it really doesn't matter if all the financial capitalists all go bankrupt but if productive capitalists don't exploit surplus value out of workers then capitalism can't survive.
Are you joking? Please say you're joking.

[Holden Caulfield]

yes, look at the EU solution, they all decided to make an orderly system to get into the financial lifeboat but then when it came to action it was who was the strongest that was important.

Crisis have always divided the capitalist class, they seek to use national interest as a lever to protect the interests of themselves (and indirectly others in their nation), just look at the two wars for a fine example of capitalists being divided because of the crisis inherent in their system

[Psy]

Are you joking? Please say you're joking.
You do realize the financial industry gets its capital through exploiting the productive capitalists that get their capital through exploiting labor? Thus from a collective capitalists point of view the financial capitalists are expendable while the productive capitalists are not.

I'm also serious in that if instead of bailout out the financial industry the bourgeois states let them fail while throwing money at they productive capitalists we would have seen the crisis quickly develop into stagnation, yet a falling rate of profit is far better for capitalists then a falling rate of consumption.

[Enragé]

throwing billions at an industry doesn't make the rate of profit go up.

Also, it's not like the automobile industry is the only one in trouble, let alone the only one 'who's going to be in trouble in the coming years.

[Oneironaut]

I'm also serious in that if instead of bailout out the financial industry the bourgeois states let them fail while throwing money at they productive capitalists we would have seen the crisis quickly develop into stagnation, yet a falling rate of profit is far better for capitalists then a falling rate of consumption.

However, you are separating two fields of the same economic system. Financial capitalists and productive capitalists are mutually dependent on one another. One can not survive without the other: productive capitalists need the monstrous investments of the financial capitalists to produce while financial capitalists need productive capitalists to produce and grow in order to profit from industry.

That's the economics side of the issue. You mention that a falling rate of profit is far better for capitalists than a falling rate of consumption, yet there already is a falling rate of profit along side of falling rates of consumption: US auto sales have fallen to levels not seen in the past 15 years.

Source:http://articles.moneycentral.msn.com/Investing/Dispatch/US-auto-sales-plunge.aspx

[Psy]

throwing billions at an industry doesn't make the rate of profit go up.

I didn't say it would make the rate of profit go up, I actually said it would lead to stagnation (falling rate of profit) but it is better then a falling rate of consumption.



Also, it's not like the automobile industry is the only one in trouble, let alone the only one 'who's going to be in trouble in the coming years.
True and throwing money at other large productive capitalists would also help turn the crisis to one of stagnation.

[Psy]

However, you are separating two fields of the same economic system. Financial capitalists and productive capitalists are mutually dependent on one another. One can not survive without the other: productive capitalists need the monstrous investments of the financial capitalists to produce while financial capitalists need productive capitalists to produce and grow in order to profit from industry.

Yet the bourgeois state can take over the financial capitalists role by throwing money at productive capitalists.



That's the economics side of the issue. You mention that a falling rate of profit is far better for capitalists than a falling rate of consumption, yet there already is a falling rate of profit along side of falling rates of consumption: US auto sales have fallen to levels not seen in the past 15 years.

Source:http://articles.moneycentral.msn.com/Investing/Dispatch/US-auto-sales-plunge.aspx


True, but with bailouts of the productive sectors they could try to stabilize the levels of consumption at the cost of the rate of profit, rather then have both fall.

[Oneironaut]

Yet the bourgeois state can take over the financial capitalists role by throwing money at productive capitalists.

You are exactly right. It will be astonishing if Obama's government takes strides in that direction.



True, but with bailouts of the productive sectors they could try to stabilize the levels of consumption at the cost of the rate of profit, rather then have both fall.

IMO, the US auto industry is doomed. Even die hard "buy american" consumers, like my father for instance, have realized that US cars are complete shit. US auto manufacturers cannot compete with Asian manufacturers. I don't think they are going to be able to stabilize consumption rates even if they lowered the price of their vehicles to compete with Asian vehicles. It is a shame that many good workers have lost their jobs because of their shit fucking companies. Its horrible to think of how drastically this depression could potentially hit workers, which makes our job as revolutionary militants that important right now.

[Psy]

You are exactly right. It will be astonishing if Obama's government takes strides in that direction.

What choice does Obama has in the long run if the crisis continues to destabilize markets? China is already being hit hard and starting to close down factories, if this crisis continues to grow we will get to have a live example of what happens in capitalism when the M-C-M' cycle totally freezes up. So far all the attempts by the bourgeoisie states to bailout the financial capitalists has only accelerated the destabilization of the markets as financial capitalists used the bailouts to hoard more capital so they can realize more fictitious capital.



IMO, the US auto industry is doomed. Even die hard "buy american" consumers, like my father for instance, have realized that US cars are complete shit. US auto manufacturers cannot compete with Asian manufacturers. I don't think they are going to be able to stabilize consumption rates even if they lowered the price of their vehicles to compete with Asian vehicles. It is a shame that many good workers have lost their jobs because of their shit fucking companies. Its horrible to think of how drastically this depression could potentially hit workers, which makes our job as revolutionary militants that important right now.
The Japanese auto companies are hurting too just not as much since they are in a far better position the US auto makers yet if the crisis continues to grow they will eventually be looking at bankruptcy too.

[ckaihatsu]

They could end the crisis tomorrow by giving the big 3 automakers $700 Billion (no string attached like they gave the banks) as bailing out manufacturing would change the problem to one of stagnating profit rates rather then one of a falling rate of consumption. For capitalism as a whole it really doesn't matter if all the financial capitalists all go bankrupt but if productive capitalists don't exploit surplus value out of workers then capitalism can't survive.


Capitalism is a system that is geared towards conquest -- it pools investments together in order to seek out new territory (markets) to pillage and exploit. Now that the entire world has been pulled into the market system, and most places have industrialized, there's nothing left to do.

At this point all that businesses *can* do is merge -- an intramural activity -- or else sit on their hands. All else is bluster and propaganda...!



I didn't say it would make the rate of profit go up, I actually said it would lead to stagnation (falling rate of profit) but it is better then a falling rate of consumption.

True and throwing money at other large productive capitalists would also help turn the crisis to one of stagnation.


All of the money in the world doesn't matter if there are no *markets* left -- because workers' wages have been gutted -- so then there are no *profits* to be made. *Anyone* can find a suit and wear it....


Chris




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[Psy]

Capitalism is a system that is geared towards conquest -- it pools investments together in order to seek out new territory (markets) to pillage and exploit. Now that the entire world has been pulled into the market system, and most places have industrialized, there's nothing left to do.

At this point all that businesses *can* do is merge -- an intramural activity -- or else sit on their hands. All else is bluster and propaganda...!





All of the money in the world doesn't matter if there are no *markets* left -- because workers' wages have been gutted -- so then there are no *profits* to be made. *Anyone* can find a suit and wear it....


Chris




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RevLeft.com -- Home of the Revolutionary Left
www.revleft.com/vb/member.php?u=16162 (http://www.revleft.com/vb/member.php?u=16162)

Photoillustrations, Political Diagrams by Chris Kaihatsu
community.webshots.com/user/ckaihatsu/

3D Design Communications - Let Your Design Do Your Footwork
ckaihatsu.elance.com

MySpace:
myspace.com/ckaihatsu

CouchSurfing:
tinyurl.com/yoh74u
That raises the question of how the bourgeoisie can solve the crisis if they can't stabilize mass consumption and production.

[fabiansocialist]

It looks like the capitalist crisis has divided the capitalist class (more then usual). Financial capitalist has mostly used their bailout to hostilely take over other finical capitalists all while the bourgeoisie states drag their feet on dealing with floundering capitalists in the productive sectors. It seems each group of capitalist in this crisis are only out for their own interests and don't seem to be currently thinking about the survival of the capitalist class as a whole.

I don't think any more so than previously. Finance capital and industrial capital have been divorced for a while now. Finance capital has been in the driving seat for decades and industrial capital is subservient and neglected. This is partly what neoliberalism connotes (see Harvey's book, "A Brief History of Neoliberalism," for a fuller discussion). At the level of grand strategy, this means finance capital looks at financial investments, speculation, and asset bubbles all over the world, and doesn't pay any extra attention to industrial capital in North America or Europe. And the power of US militarism safeguards these financial investments worldwide.

There is an interesting argument by Chossudovsky on how finance capital is going to be used to purchase real physical assets over here (http://www.globalresearch.ca/index.php?context=va&aid=10977). Some excerpts:


In turn, this unprecedented concentration of financial power spearheads entire sectors of industry and the services economy into bankruptcy, leading to the layoff of tens of thousands of workers.

The upper spheres of Wall Street overshadow the real economy. The accumulation of large amounts of money wealth by a handful of Wall Street conglomerates and their associated hedge funds is reinvested in the acquisition of real assets.



Paper wealth is transformed into the ownership and control of real productive assets, including industry, services, natural resources, infrastructure, etc.
And remember, it's finance capital that has political influence today, and not industrial capital, which has been marginalised and shunted to one side.

[Psy]

I don't think any more so than previously. Finance capital and industrial capital have been divorced for a while now. Finance capital has been in the driving seat for decades and industrial capital is subservient and neglected. This is partly what neoliberalism connotes (see Harvey's book, "A Brief History of Neoliberalism," for a fuller discussion). At the level of grand strategy, this means finance capital looks at financial investments, speculation, and asset bubbles all over the world, and doesn't pay any extra attention to industrial capital in North America or Europe. And the power of US militarism safeguards these financial investments worldwide.

There is an interesting argument by Chossudovsky on how finance capital is going to be used to purchase real physical assets over here (http://www.globalresearch.ca/index.php?context=va&aid=10977). Some excerpts:


And remember, it's finance capital that has political influence today, and not industrial capital, which has been marginalised and shunted to one side.
The problem is the capitalists already indebted the proletariat, there is tons of fictitious capital that existence depends on the current income levels of the proletariat. Capitalists has painted themselves into a corner, by squeezing the proletariat more capitalist will causing more devaluation of fictitious capital (as workers won't be able to pay for what they already consumed) and workers would be consuming less (as they would have less spending power).

[fabiansocialist]

The problem is the capitalists already indebted the proletariat, there is tons of fictitious capital that existence depends on the current income levels of the proletariat. Capitalists has painted themselves into a corner, by squeezing the proletariat more capitalist will causing more devaluation of fictitious capital (as workers won't be able to pay for what they already consumed) and workers would be consuming less (as they would have less spending power).

What you are saying is all true: this is the perpetual contradiction of capitalism (insufficient buying power by workers), and this is the form it's taking today. But because finance capital has political power, it can look after its interests. Thus it will be awarded trillion-dollar bailouts and not industrial capital, and certainly not workers. In my opinion, the whole financial and economic system itself will buckle under the kind of stress that the demands of finance capital are putting on it.

[Psy]

Well looking at the current situation it seems the ruling class is divided over letting the auto industry going extinct or to save the auto industry to save capitalism (since a growing number of bourgeois economists predict a domino effect that would cause a total collapse of the GDP if the auto industry fails)

[KC]

Economic crisis brings a sharp increase in class struggle. This aggravation of class struggle occurs not only between the bourgeoisie and the proletariat, but also within different strata of the bourgeoisie itself.


You do realize the financial industry gets its capital through exploiting the productive capitalists that get their capital through exploiting labor? Thus from a collective capitalists point of view the financial capitalists are expendable while the productive capitalists are not.

The reason why your comment was ridiculous was that first, giving the big 3 any amount of money isn't going to have a significant impact on the state of the economy; and second, giving the big three any reasonable (realistic) amount of money isn't going to save them from possibly going bankrupt.


I didn't say it would make the rate of profit go up, I actually said it would lead to stagnation (falling rate of profit) but it is better then a falling rate of consumption.

Deflation (falling rate of consumption) has already started happening.


True, but with bailouts of the productive sectors they could try to stabilize the levels of consumption at the cost of the rate of profit, rather then have both fall.

How would they "stabilize the levels of consumption"? Do you understand how deflation works?


That raises the question of how the bourgeoisie can solve the crisis if they can't stabilize mass consumption and production.

Mergers do stabilize production.

[Psy]

Economic crisis brings a sharp increase in class struggle. This aggravation of class struggle occurs not only between the bourgeoisie and the proletariat, but also within different strata of the bourgeoisie itself.



The reason why your comment was ridiculous was that first, giving the big 3 any amount of money isn't going to have a significant impact on the state of the economy; and second, giving the big three any reasonable (realistic) amount of money isn't going to save them from possibly going bankrupt.

There are bourgeois economist that are now coming to the realization that the failure of the auto industry would lead to more downward pressure of consumption thus they have become alarmist over the reluctance of a bailout of the auto industry, stating a domino theory were if the auto industry fails there is the risk of it spreading through the entire productive economy were industry after industry fails because the auto industry failed.




Deflation (falling rate of consumption) has already started happening.



How would they "stabilize the levels of consumption"? Do you understand how deflation works?

The idea is to avoid further downward pressure on consumption.




Mergers do stabilize production.
Wrong, mergers would fuel downward pressure on consumption as it would lead to lay-offs that would lower the consuming power of the work force.