Date: Fri, 15 Nov 1996 09:02:46 GMT From: Chris Burford <cburford-AT-gn.apc.org> Subject: M-I: SC on Rate of Profit Siddharth on Rate of Profit: --------- However, the capitalist and Marxian definitions of the rate of profit are different since the capitalist divides the profit by the *total* capital investment not by the capital investment consumed during a year (one measure of which is depreciation and the annual costs of raw materials, utilities, etc.). So when we talk about the "falling rate of profit", which definition is implied? Also, how are the two definitions related? Chris B: ------- Siddharth's points here highlight the fact that any serious discussion of an economy, marxist or captialist, really must see it as a perpetuating system, month by month, year by year, which renews itself. It is a living system. In capitalist accounting, depreciation is one way of allowing for the fact that past effort must be over time renewed. But as S points out, the assumption in bourgeois concepts of the ownership of property, the capitalist is assumed to have a right in perpetuity. Marxists refer to this in another way as the tyranny of dead labour over living labour - pernicicious both for the exploitation this involves and for the disempowerment of current labour to decide democratically what it really wants to do. The bourgeois property conventions that underly capital have the consequence that capital continually enlarges itself, in an economy with a finite labour supply, so that the rate of profit must have a tendency to fall. This is only relieved by the periodic discounting of capital, sometimes by inflation, at other times, through bankruptcy or mass crises in which large amounts of capital are destroyed. --- from list marxism-international-AT-lists.village.virginia.edu ---
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