1. The commodity, capitalism’s commodity, the “one,” the multiple, collective object/relation Marx explores is a use value; it is, they are, useful articles, satisfying or dissatisfying some human need. In this, production establishes its continuity with other modes of production. Production is need; is the engagement with utility, and necessity.
It, they, those commodities are the property of an owner, who cannot be the direct producer of it, those commodities…at least not for long. When Marx wrote that capitalism requires the separation of the direct producer from the products of his/her labor, Marx wasn’t kidding. The direct producer is separated from the product of direct labor. And the capitalist is not, or cannot for long, accumulate capital from his/her own labor. The condition of labor is not only that the product of the labor belongs to someone else, but that the condition itself, the conditions under which labor is undertaken is that the means, the mechanism, of production belongs to somebody else. The ability to labor serves no useful purpose for its direct owner except and in its expression as units of time, as exchange.
No quality exists in capitalism without a quantity, a number, a volume; a dimension. The units of time provide that quantity. How useful is the commodity? How useful is the commodity to others, as we’ve already established that the condition of the production is that the labor and the labor time belongs to the owner of the means of production, and the product is of no use to the producer and/or the owner except in exchange.
How useful; how valuable? These are social determinations; social measurements; social calibrations. And this is how we get to exchange value. The society of private producers, of private production, where labor-time is exchanged, will bestow, distribute the real, the socially necessary, allotment of time as value, as money, as how much money.
Short version: It’s the reverse twist with a half-gainer on the old “If you’re so necessary, useful, smart, why ain’t you rich?”….. “I’m so rich because I am necessary, useful, smart. I own. I command the labor time of others.”
2. The commodity “realizes” itself, realizes the surplus labor-time absorbed in its production in the confrontation, the engagement with all other commodities; and only by claiming, or being awarded, a portion of the total surplus value absorbed in the entire mode of production and brought forward for exchange.
Capital realizes itself in the engagement with other capitals, even if, particularly when, that engagement appears as swindle, “unfair” advantage, theft, scam; appears in the person of thieves, speculators, scammers. There are not even 6 degrees of separation between Warren Buffett and Bernie Madoff. There’s only the separation between 1 and 0; between on and off; between sale, no-sale; between inside and outside a prison wall.
This engagement, this distribution, performed in the markets is manifested in the variation, the divergence, between cost and price. Arbitrage is the social adjustment of value. The realization of a portion of any value becomes a function of information. Knowing, learning, meeting, snaring the best prices, on either/both sides of the exchange becomes the vital interaction among capitals. Welcome to information technology.
3. Value is a relation or a condition of labor that is expressed by time as a quantity. Exchange value is not only the expression of the quantity. It is simultaneously a reckoning, a calculation of the probability of the portion of total value represented by all commodities, of capital as a whole, that can be claimed by a commodity in particular. Prices are possibilities; possibilities are information. The dimension or quantity of the price does not, cannot, exist separate and apart from the probability, likelihood, of its actualization.
All previous exchanges provide a record, a guide to that probability. Welcome to the world of options, futures, puts, calls, strike prices, value-at-risk, and quantitative analysis. Welcome to the algorithm of capital– a set of rules, based on previous exchanges, for determining the probability for successful future exchanges.
The extent of the capitalists’, all capitalists’ knowledge and interest in history, comes down to, more or less, the history of exchanges, price.
For these same capitalists, when they appear as sellers in the markets, and they are always trying to sell, the actual physical existence of his or her commodities is just so much wasted space, so much down time, so much unnecessary evil. After all, the purpose of the accumulation of capital is not the accumulation of cars, or coal, or surgical instruments, but rather the accumulation of that relation, that condition of labor-time into money. The calculus of capital is always one of adjusting, approximating, evaluating the probabilities of the one money at hand versus the two monies that might be in the bush.
4. The means of circulation, the means of transportation and communication, are themselves both concrete, as container ships, locomotives, trucks, telephones, fiber optic cables, and abstract– as values. They are capital. In an additional “refinement” or “progression” of capital, the means of circulation can anticipate the realization, or materialization of value, and communicate, transport that anticipation from buyer to seller and back again. The transmission of contracts, letters of credits between and among the parties to exchanges is just such “anticipatory realization,” “concrete abstraction.” Value can be detached from, travel far ahead of, and much more quickly than its material form, its host. If value is the shadow of labor power, circulation is charged with moving the silhouettes of those shadows, and nothing moves the more images of massed values further, faster, than the digital platforms, the strings of 1s and 0s piped through fiber optic cables, or over the radio spectrum.
This function, bridging the distance and the time among capitalists is fundamental to maintaining the continuity of capitalist production; of eliminating any interruption to capitalist production, and the expropriation of future surplus labor time that might occur through a delay to realizing the previously expropriated surplus labor time. In this, at least, the means of circulation, share a continuity and commonality of function with the development of the credit system; the credit system being generated in and by the different circulation times, different rates of realization; different periods of turnover. Credit too is supposed to smooth the ragged edges of the capitalist cloth.
Still, these are capitalist means of achieving “balance” “uniformity” “continuity” “consistency,” so these means are themselves subject to the imbalance, discontinuity, inconsistency, unevenness of capital accumulation. The means of communication and transportation “suffer” from overproduction, over-accumulation, declining rates of profit, and the distribution of profit according to the size and efficiency of the capitals.
5. Whether the profit realized by the mechanisms of circulation are derived from the surplus value extracted from “their own”– if such a thing can ever be said to exist in capitalism– workers, or whether it is claimed against the surplus value dumped into the markets by the production units of capitalism, the means of communication and transportation must work ceaselessly to reduce costs, to process, circulate, increasing numbers of commodities at– not simply the “socially necessary time”– but at or towards less than the socially necessary time in order to appropriate that claim on greater increments of surplus value.
The reduction of unit costs, the increased output or circulation, the “turnover within the turnover” is dependent upon the displacement of human labor-power by machinery, by accumulated labor-power that is embodied as capital values in the mechanical rather than the living factors of production. The displacement and devaluation of labor, relatively and absolutely, rather than the creation and reproduction of “skilled labor;” rather than the generation and regeneration of “compound labor” is the compulsion capital imposes on itself; the compulsion capitals impose on each other, in the accumulation process.
The irrepressible conflict in this process is, as always, that the increased volume of output derived from the introduction of machinery into the production process does not, cannot, no matter how desperately the bourgeoisie wish it weren’t so, increase the amount of new value extracted and realized in the valorization process.
Such applications can…under certain and very limited circumstances… reduce the time required in the labor period to reproduce a value equivalent to the wages, leaving, theoretically again in certain very limited circumstances, a greater portion of the labor period “free” for expropriation.
However outside the certain and limited circumstances, the expansion of capital values embodied in the technical platforms of the means of circulation can reduce costs faster than it does reduce prices thereby transferring value and offsetting the tendency of the rate of profit to decline among these most capital intensive sectors.
So, for example, the application of advanced radio frequency technologies, and the development of digital sensors for assessing wheel-rail adhesion in the rail industry, has led to the ability to “disperse” locomotives throughout the make-up of freight trains of almost two miles in length. This distributed power arrangement allows a single locomotive engineer located in the lead locomotive to control four or five or six locomotives distributed throughout the train make-up, allowing for “smoothing” the applications of power and braking throughout the extended length of the train; effectively controlling the “draft forces” generated by a train stretched over two miles of railroad with curves, ascending and descending grades, which if not properly controlled, literally tear the train apart.
The implementation of sensors and the software to “read” the sensors for wheel rail adhesion allow more efficient use of traction power, including removing power, taking locomotives “offline” when the locomotive is not needed over sections of the railroad that are relatively flat and straight. Again, only a single locomotive engineer is required to oversee this application and removal of tractive effort… as of now, with railroads working diligently toward automatic train operation where sensors and algorithms replace even that single employee.
Crew costs decline. Fuel consumption is reduced; wheel and brake shoe wear minimized; rail life extended; derailments prevented; train lengths and weights dramatically increase along with reduced unit operating costs; and of even greater importance, the increased train lengths and weights do not impair overall train speeds nor reduce the network velocity.
As efficient as these systems are, and they are truly efficient (and truly safer) they provide not a shred of additional new value to rail operations. The systems “pass through” increments of their own pre-existing value. They do reduce operating costs, and do reduce them more sharply and more quickly than railroads reduce their tariffs. Still the tendency of the rate of profit to decline temporarily forestalled, eventually becomes more acute as technology replaces human labor.
Question: what happens to surplus value as the necessary labor-time approaches zero? Answer: It soars. Then collapses toward zero. If necessary labor-time is zero, meaning no labor is socially necessary, then there can be no surplus value.
As the volumes of commodities, even if those commodities are nothing but the information about other commodities, circulated expand, cash flows, the echo of once-upon-a-time profit and the whisper of yet-to-be profit, expand. The bourgeoisie are always using this week’s surplus value to claim last month’s profit; and always encumbering tomorrow’s profit for today’s revenue.
6. In the last week of July 2017, Amazon announced that its second quarter profit had declined 7.7 percent vs. the 2016 second quarter. This decline in profit was coincident with a 25 percent increase in sales. Amazon now accounts for 40 percent of all online retail sales.
“Cloud” computing services, the multiply arrays of computers used for the execution of transactions; the storage of data, information, records, transactions belong to other companies is both the pot of gold and the rainbow for Amazon. The annual operating income from cloud services at $916 million exceeds the $628 million income for the corporation as a whole.
Profit as a portion of revenue in the second quarter measured 5 percent. In the first quarter of 2017, the ratio for US manufacturing, mining, and construction sectors in aggregate measured 9 percent.
Amazon explained the profit decline as a result of a 46 percent increase in capital spending, particularly in expenditures on new property and equipment under capital leasing arrangements which doubled from the prior year. Amazon’s capital investment in the second quarter exceeded the combined expenditures Microsoft and Alphabet.
The doubling of capital expenditure upon properties and equipment produced an increase in employment… of about 10 percent.
All in all, Amazon maintains its “claim” as the least profitable tech company in the US sector.
7. The mass, and the capital value, of the production platform of Amazon, and the other FANGS are the results both of the need to reduce costs, and the need to successfully handle “peak” loads, peak service requirements.
Capitalism, however, never performs at a peak. Capital accumulates cyclically, unevenly. All previously accumulated values become non-performing, non-circulating, immobile during these “down” phases of the capitalist cycles. The “solution,” as it appears to and in all phases of accumulation, is to transfer the burden of this uneven-ness directly onto the living components of capital, directly unto the workers– temporary and part-time employment become permanent and full-time features of the “new” technologies. The “cyclicality of demand” explanation veils the ongoing need of capital to continually devalue, marginalize, atomize labor-power, to drive the wage below the value of labor-power; to make it impossible for the working class to maintain its own reproduction except on a continually diminished, depreciated, debased level.
The enhanced productivity of labor does not allow for, nor does it sustain, a “higher” wage; a “first world” privilege; an “aristocracy of labor.” On the contrary the productivity of labor under capitalism demands the sustained attack on the “living wage.” It has seen its own future, and it’s Bangladesh….. virtually.