“In
the long run, we’re all dead” marks an important turning point in the
intellectual prise de conscience of
the bourgeoisie: capitalism is not “the end of history”; its “economics” does
not embody “the truth” – it is not a “revelation”. Capitalism is a product of
human history and, like all historical artefacts, its time will come too. The
only “certainty” is not that of the mathematical equations of Walrasian general
equilibrium: the only “certainty” this side of “death” is “uncertainty”.
Nothing is absolute, and nothing is infallible or imperishable. If we wish to
preserve this “particular form” of “economic society”, we – “we” the
bourgeoisie – must ensure its survival: and survival means “reproduction”, and
reproduction means the co-ordination of economic activity in a manner that
remains fundamentally capitalist but that does not threaten the reproduction of
the society of capital, and that means “reproduction of the wage relation”.
Now, reproduction of the wage relation means ensuring a level of employment
that is as close to full employment as can be consistent with the reproduction
of the wage relation.
This
implies at least two things: first, the wage must not be so high that wage
labourers refuse to alienate their living labour for capital to exploit on an
expanded scale; and secondly that the wage does not fall so low that the
investment decisions of capitalists in terms of the future stream of income –
in other words, the “profitability” of capital – is not jeopardized by making
formerly “less profitable” investments become more profitable. If the “future”
of capitalism is to be secured, then the “profitability” of current capitalist
investment must also be secured. Differently
put, the “financial gearing” of investment must be “geared” in harmony or
co-ordination with the antagonism of the wage relation expressed “financially”,
in monetary units, so that the “expected future yield” from present investment
is compatible with the expanded reproduction of living labour and therefore
with the wage relation!
The
implications of this realization are absolutely enormous and astounding. First
among all bourgeois economists, in a feat almost equaling the political
analytical genius of a Karl Marx, Keynes perceives that the “financial pyramid”
of finance capital must be trans-formed from a “casino capitalism” into a
co-ordinated and “planned” maintenance of output and employment by using the
money wage as “the fundamental unit” of calculation of the total final demand
(aggregate demand and, more specifically, “effective demand”) of the capitalist
system regardless of what individual
capitalists might decide or think! The very “expectations” of individual
capitalists, the “animal spirits” of “private investors” must be adjusted
“socially”, “collectively” through the monetary medium – through the
fundamental “unit” of the money wage – so that a debt-deflation, a “financial
panic” is “politically” avoided!! “We, the bourgeoisie” must know that, in the
words of President Roosevelt in the Inauguration Speech of February 1933: “ALL
WE HAVE TO FEAR IS FEAR ITSELF!”
Death
is the only “certainty”. This side of death there is only “uncertainty”: from
Heisenberg to Einstein to Heidegger, Keynes’s language and thought closely
parallels the “existential crisis” not just of the bourgeois Individualitat that even Schumpeter has
abandoned with his “obsolescence of the entrepreneurial function”, that Weber
had abandoned with his “iron cage”, that Nietzsche had prophesised with his
Will to Power: if the only certainty is death and this side of the “long run”
is “uncertainty”, then we need a point of reference – the equivalent of a
Heideggerian Da-sein, a Lichtung, a
beam of light, to show us the way in the “world of being” that has been
“obscured” by the War and the Depression. And that “point of reference” can be
only the “actual employment” of social resources, “the annexation of the
future”, the control of the monetary “bridge” to the future, - and that must
pass through the control of the wage relation whose fundamental “social
institutional expression” is the money wage!
The
Great War was the last “European civil war”. Just as in the 1640s when Thomas
Hobbes was confronted with the English Civil War at the very dawn of bourgeois
capitalist society, the only answer to civil war is the abandonment of
“individual choice” in the face of death
(!) in favour of the establishment of a State-Machine, of a Leviathan, that
can stop us from fearing fear itself!
Let
us leap without further ado to Part Two of the General Theory, the part on
“Definitions and Ideas”. There it is! Chapter 4 on “The Money Wage”, section
II:
That the units, in terms of which economists commonly work, are unsatisfactory can be illustrated by the concepts of the National Dividend, the stock of real capital and the general price-level: --
(i) The National Dividend, as defined by Marshall [p.38] and Professor Pigou, [1] measures the volume of current output or real income and not the value of output or money-income. [2] Furthermore, it depends, in some sense, on net output;¾on the net addition, that is to say, to the resources of the community available for consumption or for retention as capital stock, due to the economic activities and sacrifices of the current period, after allowing for the wastage of the stock of real capital existing at the commencement of the period. On this basis an attempt is made to erect a quantitative science. But it is a grave objection to this definition for such a purpose that the community's output of goods and services is a non-homogeneous complex which cannot be measured, strictly speaking, except in certain special cases, as for example when all the items of one output are included in the same proportions in another output.
“A
measure! A measure! My kingdom for a measure!” Just as Einstein found the speed
of light as the fundamental constant of the universe, just as Heidegger finds
in death the “”lighting” of Da-sein (being there), so now does Keynes need a
measure, a unit, an indication of the level of antagonism of living labour
against the wage relation in a capitalist
society that needs to trans-form itself into a “society of capital” in which
“the control of growth becomes the growth of control”! But this must be a
“measure” that is not indicated in “real” terms because it will be quite
impossible then to relate this “measure” to the specifically capitalist
“condensation” of command over living labour in terms of “value”, of exchange
value, and then utterly impossible to co-ordinate this “real measure” with the
financial pyramid of future income
streams from present investments.
“Real wages” will never be able to tell us what the future relations of
political power between workers and capital will be: only the money wage can
allow the State to act “collectively” and “in aggregate” to mediate and
negotiate and buffer and co-ordinate the political social antagonism that the
wage relation generates.
Just
listen to Keynes! Read carefully please!! Because the problem of “measurement”
becomes especially dire and diabolical where “the command of capital over
living labour” through the wage is concerned with “the future”! At that level,
the real wage cannot even remotely be
used to homologate and homogenize the levels of industrial antagonism across
different branches of capitalist production and across “periods” of investment!
This can be done “only” (!) in terms of a “measure” that expresses “value” –
that is, the homogenized expression of antagonism across the aggregate monetary
expression of social capital:
(ii) The difficulty is even greater when, in order to calculate net
output, we try to measure the net addition to capital equipment; for we have to
find some basis for a quantitative comparison between the new items of
equipment produced during the period and the old items which have perished by
wastage. In order to arrive at the net National Dividend, Professor Pigou [3] deducts such obsolescence, etc., "as
may fairly be called 'normal'; and the practical test of normality is that the depletion
is sufficiently regular to be foreseen, if not in detail, at least in the
large". But, since this deduction is not a deduction in terms of money, he
is involved in assuming that there can be a change in physical quantity,
although there has been no physical [p.39] change; i.e. he is covertly introducing
changes in value. Moreover, he is unable to devise any satisfactory formula [1] to evaluate new equipment against old
when, owing to changes in technique, the two are not identical. I believe that
the concept at which Professor Pigou is aiming is the right and appropriate
concept for economic analysis. But, until a satisfactory system of units has been adopted, its
precise definition is an impossible task. The problem of comparing one
real output with another and of then calculating net output by setting off new
items of equipment against the wastage of old items presents conundrums which
permit, one can confidently say, of no solution.
Not
only is there “the problem of comparing one real output with another”; but,
more important, there is the far greater problem “of then calculating net
output by setting off new items of
equipment against the wastage of old
items” when there have been "changes in technique"! We will deal with this exquisitely Schumpeterian problem of "innovation" later, which Keynes ("the father of stagnation", completely overlooks!). For now, the “problem” is “to bridge” and homogenize the political command
of capital over living labour not just “across sectors” of capitalist industry,
but also “across periods” of investment, “between the present and the future”!
And, as Keynes says, only “money” can do that, and only “the money wage” can
“ground” institutionally the political command of capital. Here is Keynes
again:
In dealing with the theory of employment I propose, therefore, to make
use of only two fundamental units of quantity, namely, quantities of
money-value and quantities of employment. The first of these is strictly
homogeneous, and the second can be made so. For, in so far as
different grades and kinds of labour and salaried assistance enjoy a more or
less fixed relative remuneration, the quantity of employment can be
sufficiently defined for our purpose by taking an hour's employment of ordinary
labour as our unit and weighting an hour's employment of special labour in
proportion to its remuneration; i.e. an hour of special labour remunerated at
double ordinary rates will count as two units. We shall call the unit in which
the quantity of employment is measured the labour-unit; and the money-wage of a
labour-unit we shall call the wage-unit.[1]
We
will look at Keynes’s underlying assumptions on real wages next.
It still needs to be seen if the correlation has a direct affect. The capital adjusts as well.
ReplyDeleteOf course, wage or salary is the fundamental unit of a capitalist society. An individual who is underpaid may not be able to provide for his / her daily needs.
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