Friday, November 30, 2007

Capitalism = making, selling, consuming, trashing – stuff, people, planet

Capitalism - RIP / RID*
* RIP / RID = Capitalism ‘Rest-in-peace’ / Get ‘Rid’ of capitalism

The following analysis allows many features of capitalism to be discerned:

- such as the inevitable drive, downwards, of wages and salaries, along with ever-increasing drive, upwards, of pollution, violence and insecurity.

Remember the ‘Wealth- and Pollution-creating Equation’ of applied chemistry and chemical thermodynamics’ from earlier posts –

raw materials + energy --> 'wealth' (or ‘Added Value’) + pollution

(Read the arrow as - ‘goes to give’ )


Diagrammatically this becomes:

[------------]

I$$$$$$$ I

I$$$$$$$ I

I$$$$$$$ I } 'Added Value'

I$$$$$$$ I

I$$$$$$$ I

I$$$$$$$ I

I$$$$$$$ I

I$$$$$$$ I

I-------------I

I$$$$$$$ I } the cost of raw materials and energy

I-------------I



This 'Added Value' gets distributed* as follows:

[ ----------------]

I $$ wages $$ I

I ------ I

I $$ salaries $$ I ------- wages, perks and salaries are

I ------------ I ------ the three forms of return 'to labour' **

I $$ perks $$ I

I-------------------I

I $$ interest $$ I

I ----------- I ------ Rent, Interest, Dividends* (RIP) are

I $ dividends $ I ------ the three forms of return to 'capital' **

I ie $ profits $ I (* including the sale proceeds of materials and energy)

I ----------- I

I $$ rent $$ I

I------------------I

I $$$$$$$ I }the cost of raw materials and energy

I------------------I



This step-wise analysis allows many other features of capitalism to be discerned, such as the inevitable drive, downwards, of wages and salaries, along with ever-increasing drive, upwards, of pollution, violence and insecurity.

For example,

Who bears the cost of a ‘competitive market’ ?!

Just guess!

[ ----------------] Overall lower 'Added Value'

I $ wages $ I So lower wages - and benefits - for waged workers

I ------ I

I $$ salaries $$ I

I ------------ I

I $$ perks $$ I

I-------------------I

I $$ interest $$ I

I ----------- I

I $ dividends $ I

I ie $ profits $ I

I ----------- I

I $$ rent $$ I

I------------------I

I $$$$$$$ I }the cost of raw materials and energy

I------------------I

?! Guess who! - 'Fighting for market share' - and 'resource use optimization' ha! (not!!)


Further: the diagram, above, describes the initial – or primary – distribution of the money proceeds from the sale of the finished products.

** Subsequent - or secondary – distribution of the primary distribution includes taxation (even though ‘deduction at source’ of income-tax occurs before the primary distribution actually reaches the hands (or bank accounts) of the primary recipients). Discussion of these secondary distributions will have to wait until later.

(Note also: the terms ‘earned-' and 'unearned-income’ might be considered here, but these terms seem to be culturally specific and, certainly, politicized. See the final note at the end of this essay.)

So, the solution to getting rid of capitalism is to have strategies that deal with:

a) inequitable ownership of the knowledge and land resources held through ownership of 'workplaces' (ie machinery - 'frozen knowledge' - and the 'soft-know-how' - licenses, patents, etc embedded in workplaces).

b) exploitation through the use of money and interest-bearing credit/debt necessary to lubricate production / trash the planet (in a money economy)

c) inequality in the 'returns to labour': the inequalities in income form wages, salaries and 'perks', along with inequalities in income from those 'in paid work' and those not 'in paid work' (carers, home parents, the elderly, students, those 'unable' to join in 'paid work' and so on)

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