Contradictions of Accumulation in Australia

Quote:
Below is the (edited) text of the paper I presented at Historical Materialism Australasia. This year’s conference happened in the context of a serious disagreement around sexual violence prompted in part by the SWP crisis. You can find some material on this here and here.
The below paper is fairly limited and suffers from conceptual and structural problems. However in the spirit of With Sober Senses I am happy to make it available as it functions both as a marker of the progress of my research and also as a fairly functional summary of my work so far.
In the discussion three major issues came out for me, and I thank those who contributed.
1. So far I still conceive of the public service/ state provision of reproduction as being too separate from capital accumulation proper. They are deeply and complexly intermeshed on the molecular and molar level.
2. More work is needed to further investigated how capital ‘thinks’ on the level of society
3. This kind of research needs to be careful that it doesn’t collapse into being a Marxian plan for a better capitalism – there is a tendency to do just that.
Quote:
For capital there is no problem: restructuring of the system is the condition for the stabilization of the regime, and vice-versa…The interests of the proletariat, are quite the opposite. The proletariat aims at a critical seizure of the nexus between stabilization and restructuring, in order then to attack it.(Negri, 2005, p. 232)

So what I want to do here is fairly simple: I want to trace out what I think are some of the major barriers of capital accumulation in Australia in our present conjuncture and I will do so with a pretty broad brush – apologies to the details and the devils they may contain. I do so because I think these barriers are some of the deep fault-lines of class antagonism in Australia. This will be a summary of the research I have been doing over the first half of this year for the blog With Sober Senses.

Note: I didn’t read out the following section as I thought it was unnecessarily small minded, took up too much time, and potentially drew focus from what was actually important to discuss
( My intention is to help to revitalise the Marxian critique of political economy in a way that is useful for comrades in struggle. In this sense my tone is quite polemical as on a whole activist Marxism in Australia is rubbish: built around either a theological understanding of crisis and the tendency of the rate of profit to decline as the explanation of everything/ or an explanation based on the idea that bad people and bad ideas - most often summed up under the rubric of ‘neoliberalism’ – are at fault. The fact that comrades can often hold to both of these individually flawed and mutually exclusive notions shows the poor quality of the doxa that goes under the name of Marxism in Australia. No wonder so many people in Australia involved in struggles hold Marx and Marxism (not a term I like by the way) to be exhausted or irrelevant. Academic Marxism whilst of a higher quality is often displaced from lived realities. Rather I am attempting (and I am ready for some alarm bells to go off here and some philosophical questions to be thrown at me that I probably can’t answer) to be genuinely materialist – to understand how capitalism and the current class composition in Australia actually functions. My other polemical aim is to help develop a communist class based response to our present moment rather than a Left/socialist Keynesian one. )

Part of my argument is that many of the barriers that capital in Australia currently faces (and this probably is changing even as we speak) are to do with reproduction. Now of course all crises are crisis of a social order trying to reproduce itself. In this case I want to be more specific – reproduction here refers to a series of events and processes that whilst are intermeshed with capital accumulation proper are at some level separate from it yet are crucial for capital’s existence. Indeed one could say that seemingly paradoxically reproduction is an a prior condition for capital’s existence. This is partially removed from Marx’s argument in Capital where capital’s process of accumulation and circulation works to constantly rebuild and expand its foundations – that ultimately what workers produce is their own condition of being workers (1990, pp. 723-724). Now this is true but in a real capitalist society more is needed. There are at least three strands of reproduction that seem crucial. Althusser (2008) on the need for ideological institutions to produce certain ideas and forms of subjectivity; the feminist arguments such as those of Fortunati, James, Della Rossa and Federici that identify the work of women in the home to care for children and male workers (1975; 2004, 2012; 1995) and then the generalisation of the argument to look at so many of the activities outside the working day proper (Midnight Notes Collective, 1985); and Paolo Virno’s (2004) insistence that since labour-power is a potential that exists in the body this is then the only sound foundation from which to grasp the origin and functioning of bio-power. All three of these tendencies focus on the question of what is necessary to produce workers as workers: how must we think about ourselves, understand our world, care for each other and ourselves and be measured monitored, internally divided and disciplined. Australian capital demands a certain kind of labour-power, a certain kind of worker, and our inability or unwillingness to be this kind of person confronts capital as a problem.

So that said how can we sketch the current conjuncture of Australian capitalism? It is clear that we are in a moment of transition but to what and how is more opaque. The last twenty years can be summarised by the success of the mining boom and the durability of what I want to call the ‘high-work, high-consumption, high credit’ deal offered to workers. In the context of the global wall-mart economy, to use Varoufakis’ (2011) term Australia underwent a long resources boom. Of course there is a lot of work on this but here I want to draw out two points: one that until very recently the resources boom lead to a great deal of commentary from bourgeois sources on the patch-work or two speed nature of the Australian economy. This is I think a limited understanding of an inability for or at least barriers to the formation of an average rate of profit in Australia. Capitalism has a tendency towards the formation of an average rate of profit as capital moves from sections with lower rates of profit to higher rates of profit and prices are displaced(?) to circulate not around value but prices of production(Marx, 1991). As Caffentzis (2012) emphasises such a process is necessary for the both the formation of individual capitalists into a class concerned about questions of social totality and also is essential to the profitability of firms that have a higher composition of capital – as value produced elsewhere is realised by these firms. But a tendency towards a formation of an average rate of profit doesn’t mean the success of this formation. And indeed with a resources boom, and specifically this resources boom, capital runs into two limitations. The obvious one – mining requires mineral despotises thus limiting the amount of business opportunities; and secondly and perhaps more importantly there was/is a shortage of skilled blue-collar labour. This meant not only are workers able to receive impressive conditions the high cost of labour impacted on those non-mining sectors as did the high Australian dollar. The shortage of labour power is also a ceiling, be it a floating one, on the total social working day.

In the context of this boom, as part of the general shift from Fordism to post-Fordism, there was an obvious and profound change of the class composition in Australia – obvious to our lived experiences if not the mental images of the working class that haunts the mind of the Left. Capital offered us a new deal to replace the end or the restriction of the social democratic deal. The amount we worked increased, the amount of us who worked increased, wages increased – but in a highly unequal fashion – and access to credit and finance massive increased. Thus whilst the labour share of national income dropped it was not necessarily experienced as a drop in living conditions: workers had access to more money and the price of many goods became cheaper– due to the shift of production to the new workshops of the world.

In this context the major barrier facing accumulation was a shortage of labour-power. But since labour-power is a potential of the human body it isn’t simply a numerical questions – if refers not only to the amount of people available to work but what skills, abilities and ideas they have, and also the intensity they can work and the duration of the work they can do and are willing to do. This is a partly a demographic question as an aging population means a reduction in potential workers(Reserve Bank of Australia, 2012, p. 10) – something that runs into the particular racialised elements of capital’s deal offered to workers. The restriction of immigration has historically been a reactionary strategy elements of the workers’ movement and large elements of the class support in an attempt to maintain the tight labour supply and thus higher conditions(Curthoys & Markus, 1978). (An important contradiction: the tension between the racialised nature of the deal offered workers and capital’s need for more workers.)

Now of course unemployment was never as low in the 1960s and many point out problems with the ABS’s numbers. But what this doesn’t take into consideration is the lack of a job doesn’t mean that one necessarily has the labour-power, that potential to work, that capital desires. The highly fragmented nature of the current class composition means that as workers we don’t easily flow from job to job as capital requires. Thus we must always remember that behind the worker on the labour market stands a specific complex mesh of the work of reproduction that creates all of this: both the work in the home and that in the various form of service and care industries (cf. Federici, 2012; Precarias a la Deriva, 2006)

Combined with these problems are the two new barriers that capital faces as the waves of the global financial crisis start to wash on our shores again: the slow down of the rates of growth of the mining boom and the difficulties in funding state provided levels of social reproduction. The second is most obviously seen in the various forms of ‘slow’ austerity ( to use my friend Rob’s term). In the case of Queensland whilst the claims of the level of debt that the Queensland and Commission of Audit lament are overblown (Workers' Audit, 2012) the state does faces the very real difficulty of a decline in income and also more difficult global conditions to access credit – hence the obsession about credit ratings and the effects they have on the cost of borrowing. The state’s response then is to sell off, sack and intensify the quests for productivity. In practice this is an intensification of work: privatised management of services would probably result in worse working conditions, job loses mean that less workers have to do more, and the end of funding to services or restrictions to access push more work on to the household. Either the labour itself of care will intensify in the home or the costs of funding it will.

Overall this situation is obviously contradictory – on one hand capital demands more labour-power/ on the other it is less able to fund its reproduction through the state. Productivity - the intensification of labour is the proposed solution to both.

But what about the looming slow down; how does this change things? Firstly there is a need for more research here. Two points: capitalist society moves at multiple speeds. Not only are there the many speeds of various different capitals circulating and reproducing themselves there is also the time of the state and the time of the various contenting political forces and wings of capital. Secondly the question isn’t just how the crisis impacts on capital but also what capital does in this moment, how it tries to respond and also the ability of inability of workers to pose autonomous forms of existing and acting. Now it is unlikely that capital globally can solve the current crisis without letting the crash crash – a massive devaluation of capital that might, depending on what survives, allow the possibility for another cycle of accumulation(Kliman, 2012) . This doesn’t mean that capital can’t attempt to move and this matters.

So what can we see starting to unfold? There is a form of spatial fix – with capital moving from mining to real estate. This in itself requires a massive reduction in the power of restrictions in planning and environmental laws – something we see in Queensland. What will this mean for building workers and building unions – especially if this happens in the unlikely condition of an ALP federal victory?
Secondly we can expect a shared drive from the different factions of capital around productivity. Though the various different plans for increasingly productivity are only now taking shape on the national stage. One thing that may increase is the further creation and application of ersatz market mechanisms in the public service to intensify the practice of labour in the workplace. Equally employer organisations lament that lack of the control they have at the point of production to move and control workers as they wish – we just aren’t flexible enough
And thirdly households – household debt continues to hover just under 150% of disposable income (Reserve Bank of Australia, 2012, p. 6). This is unlikely to change as the costs of financing reproduction and the high level of house prices necessary to make the spatial fix work rest on the pockets of workers and is greater than their wages.

There are many examples of this

None of this is may actually solve capital’s problems. What then is a class and communist position? Such a thing cannot be determined from the kind of research this paper has produced, it can only arise in the context of struggles and compositional research - but perhaps we can raise it in discussion. Two things do come to mind. First it is probably not a terrible idea for communists to carry out similar research as attempted here – to better understand and better communicate to struggles the large structural forces and dynamics of capital. Secondly the Left in moments such as these normally attempts what elsewhere is called a Plan B – that is a solution for overcoming capital’s barriers most often drawing on some kind of reheating of Keynesian desires. But can we start to talk how the first reaction again capital proposed solutions – which will come from the Left as much as the Right – that is the refusal to accept job cuts, the defence of environments ( wild and built) against capital expansion, etc can move from a simple NO to more articulated attempts orientated towards the ‘communist horizon’?

Althusser, Louis. (2008). On Ideology. London New York: Verso.
Caffentzis, George. (2012). Against Nuclear Exceptionalism with a Coda on the Commons and Nuclear Power. Paper presented at the Crisis and Commons: PreFigurative Politics After Fukashima, Tokyo University of Foreign Studies.
Curthoys, Ann, & Markus, Andrew (Eds.). (1978). Who Are Our Enemies: Racism and the Working Class in Australia. Neutral Bay: Hale & Iremonger.
Dalla Costa, Mariarosa, & James, Selma. (1975). The Power of women and the subversion of the community (3rd ed.). Bristol: Falling Wall Press.
Federici, Silvia. (2004). Caliban and The Witch: Women, The Body and Primitive Accumulation. Brookyln, NY: Autonomedia.
Federici, Silvia. (2012). Revolution at Point Zero. Oakland CA: PM Press.
Fortunati, Leopoldina. (1995). The Arcane of Reproduction: Housework, Prostitution, Labour and Capital (H. Creek, Trans.). Brooklyn, NY: Autonomedia.
Kliman, Andrew. (2012). The Failure of Capitalist Production: Underlying Causes of the Great Recession. London: Pluto Press.
Marx, Karl. (1990). Capital: A Critique of Political Economy (B. Fowkes, Trans. Vol. 1). London: Penguin Classics.
Marx, Karl. (1991). Capital: A Critique of Political Economy (D. Fernbach, Trans. Vol. 3). London: Penguin Books in association with New Left Review.
Midnight Notes Collective. (1985). Strange Victories: The Anti-Nuclear Movement in the US and Europe London: Elephant Editions.
Negri, Antonio. (2005). Books For Burning: Between Civil War and Democracy in 1970s Italy (A. Bove, E. Emery, T. S. Murphy & F. Novello, Trans.). London & New York: Verso.
Precarias a la Deriva. (2006). A Very Careful Strike- Four Hypotheses The Commoner: A Web Journal For Other Values(11 Spring), 33-45.
Reserve Bank of Australia. (2012). The Australian Economy and Financial Markets Chart Pack July 2013. Retrieved 23rd July, 2013, from http://www.rba.gov.au/chart-pack/pdf/chart-pack.pdf
Varoufakis, Yanis. (2011). The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy. London & New York: Zed Books.
Virno, Paolo. (2004). A Grammar of The Multitude. Los Angeles, CA & New York,NY: Semiotext(e).
Workers' Audit. (2012). Workers' Audit No1. Retrieved 10th August, 2012, from http://www.facebook.com/notes/workers-audit/workers-audit-no-1/100810233400417

Comments

Y
Aug 11 2013 04:57

You assert, "Capitalism has a tendency towards the formation of an average rate of profit as capital moves from sections with lower rates of profit to higher rates of profit and prices are displaced(?) to circulate not around value but prices of production(Marx, 1991)."

What do you mean by 'value' and how do prices circulate around prices of production which I presume you are arguing are not prices circulating around value within the production dynamic?

I think you need to re-write this sentence with a view to more clarity: "As Caffentzis (2012) emphasises such a process is necessary for the both the formation of individual capitalists into a class concerned about questions of social totality and also is essential to the profitability of firms that have a higher composition of capital – as value produced elsewhere is realised by these firms."

I agree with this statement (although it needs work); but would add something concerning the fact that the high wages are due to a lack of supply in the face of an increasing demand for labour power, plus the unionisation of significant parts of the workforce. Higher prices for labour power, of course, are out of kilter with the value of the labour power itself and lead to lower rates of profit for the mining capitalists, at least lower than what they could potentially market for, if the supply of labour power was allowed to inflate e.g. the 457 visa program. "And indeed with a resources boom, and specifically this resources boom, capital runs into two limitations. The obvious one – mining requires mineral despotises thus limiting the amount of business opportunities; and secondly and perhaps more importantly there was/is a shortage of skilled blue-collar labour. This meant not only are workers able to receive impressive conditions the high cost of labour impacted on those non-mining sectors as did the high Australian dollar. The shortage of labour power is also a ceiling, be it a floating one, on the total social working day."

I would add that unpaid overtime is rampant in Australia.

You observe, "In this context the major barrier facing accumulation was a shortage of labour-power. But since labour-power is a potential of the human body it isn’t simply a numerical questions – if refers not only to the amount of people available to work but what skills, abilities and ideas they have, and also the intensity they can work and the duration of the work they can do and are willing to do. This is a partly a demographic question as an aging population means a reduction in potential workers(Reserve Bank of Australia, 2012, p. 10) – something that runs into the particular racialised elements of capital’s deal offered to workers. The restriction of immigration has historically been a reactionary strategy elements of the workers’ movement and large elements of the class support in an attempt to maintain the tight labour supply and thus higher conditions(Curthoys & Markus, 1978). (An important contradiction: the tension between the racialised nature of the deal offered workers and capital’s need for more workers.)"

This is partially true; but flawed in that immigration to Australia has seen increasing numbers of non-Australian born workers becoming naturalised citizens or on permanent resident visas. The increase in the labour pool is a boon for capitalists in that it actually does put pressure on labour to lower its price in the marketplace for commodities. The reactionary aspects of dividing the working class into competing races plays into the hands of those who know how to play the political game of divide and rule, namely the more conscious members of the ruling class.

You more make the case for the conservatives than the case for class struggle to achieve more ownership and control of the social product of labour here: "Combined with these problems are the two new barriers that capital faces as the waves of the global financial crisis start to wash on our shores again: the slow down of the rates of growth of the mining boom and the difficulties in funding state provided levels of social reproduction. The second is most obviously seen in the various forms of ‘slow’ austerity ( to use my friend Rob’s term). In the case of Queensland whilst the claims of the level of debt that the Queensland and Commission of Audit lament are overblown (Workers' Audit, 2012) the state does faces the very real difficulty of a decline in income and also more difficult global conditions to access credit – hence the obsession about credit ratings and the effects they have on the cost of borrowing. The state’s response then is to sell off, sack and intensify the quests for productivity. In practice this is an intensification of work: privatised management of services would probably result in worse working conditions, job loses mean that less workers have to do more, and the end of funding to services or restrictions to access push more work on to the household. Either the labour itself of care will intensify in the home or the costs of funding it will."

Most of the rest, I can vaguely agree with. The contention that capitalists are barracking for a rollback to the Work Choices era is more or less obvious.