I am either, nuts, or...

[Traitorfish]

Did he? To quote from Das Kapital (Vol. 1 Ch.25):



This seems to predict that capital, or wealth, will become concentrated in the hands of fewer 'individual capitalists'.

Could he mean 'economic agent' rather than 'person' by 'individual capitalist? I find it unlikely. To quote from Ch.4:



It seems to give the impression that he thinks capitalists are people rather than firms. We don't usually talk about firms with gender pronouns, for instance. If so, his prediction seems clearly that capital will become concentrated in the hands of fewer people.

Indeed, later in Ch.25 he goes on to illustrate his assertions regarding capital accumulation by looking at income distribution data (derived from tax schedules) regarding the UK in 1854 and 1864. He believed growing inequality indicated increased capital accumulation.

If Marx were right on this, his prediction regarding capital accumulation are falsified by the observed result that income inequality has decreased significantly since Das Kapital was published and the modern day. Quite simply, Marx was wrong.

This is a rather superficial argument; that Marx's choice of words were selected based on the economy as it existed in 1867 says very little about the content of his ideas. Elsewhere he discusses capital in an abstracted sense, as in chapter 25:

It is concentration of capitals already formed, destruction of their individual independence, expropriation of capitalist by capitalist, transformation of many small into few large capitals.... Capital grows in one place to a huge mass in a single hand, because it has in another place been lost by many.... The battle of competition is fought by cheapening of commodities. The cheapness of commodities demands, caeteris paribus, on the productiveness of labour, and this again on the scale of production. Therefore, the larger capitals beat the smaller.

In which the question of whether the large capitals are owned by one man or a dozen is quite evidently secondary to their characteristics as accumulations of capital. If he doesn't keep this up, it's because, firstly, this was a largely accurate description in the 1860s, and secondly, because Marx wasn't very good at writing the dry prose expected of economists (he was a philosopher by vocation and a writer by profession, after all), and by addressing the holders of capital as individuals, he's able to write a bit more colourfully. Neither are significant comments on the compatibility of his theories with the development of corporate enterprise.

Alternatively, he somehow missed a form of collective capital that had existed since the 16th century, being so scatter-brained as to manage to write about them without realising what they were. Entirely feasible, I'm sure.

Edit: Wait, come to think of it, how is this even an argument? What you're claiming is that Marx failed to acknowledge voluntary collectivisation as well as competition as a drive towards concentration, and so was the trend he suggested has been even more pronounced than (you claim) he predicted. How does that make him "wrong"?

 

[innonimatu]

I would say that fortunately the rest of your argument doesn't rest on these two falsehoods, but I can't say I see much of an argument to be resting on anything at all. I am aware that you are 'telling me' that the profit-motive no longer provides possible motive for economic decisions, what I am saying is that you have not backed this up.

No, profit can provide motive all right, anything can be arbitrarily chosen to provide motive. We could build an economy about the accumulation of pretty seashells if we wanted. I'm just saying that taking decisions based purely on profit turn out to be counterproductive. And the argument about that is old. What is new, and what I'm arguing for, is that a system which was by nature unstable is nowadays increasingly so.

You have digressed on more-or-less eloquent tirades against the capitalist system but failed to define a clear line of argument. When you have defined a line of argument you have failed to support it. You have still failed to support your assertion that 'demand for services is more volatile than that for capital' let alone the further assertion that 'capitalist firms cannot plan appropriately in service-economies'.

Misquoted, or misinterpreted. Demand in a service economy is more volatile than in our previous industrial economies. And the reason for that can be easily understood, it's the economic equivalent of Maslow's hierarchy of needs. What is at the base are universal needs, what is on top is optional. Meaning not that people will do without it, but that people will be more free to pick and choose between different "needs".
As for planning difficulties, I could and perhaps should dig up on statistics and check whether there have been more large corporations going bankrupt in the past 20 years or so than in the previous 20. But with governments themselves apparently unable to plan things by now and having to bail out the whole world's financial system, I don't feel particularly compelled to produce any more evidence. And it goes beyond finance: just GM (granted, that one was industrial) in the US would have been a gigantic bankruptcy, which didn't happen because... the government stepped in!

We increasingly trade in services because material needs were mostly satisfied. The margins for growth, at least in developed economies, get smaller and smaller. I don't have to prove that, it is self-evident through the diminishing employment in the primary and secondary sectors of the economy. And then there comes a time when the needs for services are also satisfied, for lack of time by prospective customers to enjoy any more services. In other words, there are demand limits to what we call "economic growth". But without that growth profit margins tend to collapse (and I won't explain that, it's old, old stuff by now).

The cyclic crisis of capitalism are cyclic and allow for a "reboot". But this final crisis of lack of space to grow will be, well, final. It'll require a different economic logic. We're not there yet, certainly. But it wouldn't harm us to start changing the economic logic away from profit already.

 

[Ayatollah So]

The Euro's still in a very shaky state and I don't know what endgame looks like. Orderly exit from the Euro seems unlikely so there will either be a messy reunion or a messy divorce after the big meeting on the 6th.

I mean, yeah, the macro outlook blows. China's housing bubble is showing signs of popping. Europe's sick from both structural and deficient-demand problems. The US is suffering from deficient demand.

I really hope a 1931 isn't around the corner. It's possible to avoid one: simply do a coordinated devaluation of the dollar, euro and yen against a commodity basket, then do some more QE until the deficient-demand problems are cleared. If you say "the Fed can't inflate," call the central banker of Zimbabwe. He sure as hell seems to know how to inflate.

Just because your recommendations are technically possible doesn't mean they, or any similar moves, are politically possible. You're way too sane to be taken seriously. :suicide:

Things have clearly spun out of control.

Not yet. The suicide pact could be called off; Merkel could see the light at any mo... who am I kidding