Tuesday, April 19, 2016

Best Reasons Ever For Brexit!

The Financial Times April 18, 2016

Fears over British EU referendum hold back hiring and investment

 -Uncertainty chills business -Top London Property hit -European groups delay plans

Sarah Gordon-London
Uncertainty over the outcome of Britain's EU referendum is having a chilling effect on business activity, with companies pulling back on hiring and investment across sectors from real estate to recruitment.
The slowdown is hitting property prices at the high end of the London property market and hiring in financial service last month fell 21 percent against last year.
'[Brexit fears are] having a huge impact on general confidence,' said Lord Davies, a British businessman who chairs several private equity companies. 'What is scary for foreign direct investors and investors generally is the fear of the unknown.'
...French economy minister Emmanuel Macron yesterday said Britain would struggle to regain access to the EU's single market and would lose its negotiating power in talks to protect its ailing steel industry from Chinese rivals. {My note: that's pretty hilarious given Cameron's opposition to any protectionist measures}.
His comments followed a warning from German finance minister Wolfgang Schauble, who said Berlin would be a tough negotiator if the UK voted to leave the EU and there would be no easy trade deal between the two countries.
The London property market is already showing signs of a "Brexit effect,"....
Property prices across the UK are still at historic highs, but the growth in central London, traditionally a target of foreign investors, from French bankers to Russian oligarchs, has slowed sharply.
... The real estate arm of Union Investment, the German investment company, said it had delayed buying an office building in the City of London Because of the risk of Brexit.
Now how can anyone not want more of that? More chilling of business? More declines in London property prices? More delays to buying office buildings in the City? More discord and friction among the bourgeoisie of the UK, Germany, and France?  Bring it on, Brexiteers!

Reasons to be cheerful are........(part) three, right Ian?
1. Uncertainty chills business
2. Top London Property hit
3. European groups delay plans.

When's the last time any social movement in the UK had such a "chilling effect" on the European bourgeoisie? On real estate prices in the City? Probably not since 1973- 1974 when the miners/power workers strike pushed Heath out of office. Or maybe 1926.

This is the best news from Britain since Thatcher died.

April 19, 2016

Sunday, April 17, 2016

Time and Time Again

1. Moaning and praying like a drunk with his head in the toilet bowl, the US bourgeoisie in 2001 promised themselves, and their various gods, to never ever do that again-- that being the capital spending pub crawl/keg party they had been on since 1993.  It had been a hell of a party, with a tab running to 1.1 trillion dollars, (more than all the foreign directed investment that has been pumped into China in the last 25 years).

Shirts undone, jackets ripped, ties lost, pants wet with...well, whatever, the bourgeoisie pulled their heads up long enough to plead:
"Sweet Jesus, make it stop and we promise that not only will we never spend like that again; not only will we consume more capital than we replace; not only will we drive wages down; not only will we launch a cruise missile crusade against those enemies of Christendom,the Moslems; all of that plus we promise to never ever wear plaid pants on a golf course again!"
2. And for a short time, sober, twelve-stepping their way to Baghdad and points east, the bourgeoisie consumed their capital like there was no tomorrow, above the rate of replacement. Between 2001 and 2004, net property, plant, and equipment (PPE),  those productive assets with value yet to be transferred through production, declined six (6) percent.

But.....there's always tomorrow.  With enough of those, with enough time, with their lord busy, they thought, guiding those cruise missiles to Baghdad, and the golf carts at the Doral, the bourgeoisie went back to the bottle; that bottle which they can't ever get enough of until they've had too much.  "Hair of the dog that bit us," they laughed, as capital spending turned up.  Bit more than just the hair of that dog as it turns out-- by 2007 annual capital expenditures in US manufacturing exceeded the previous peak year, 2000.  And still the bottle wasn't quite empty as capital spending in 2008 rose another five percent. Sick drunk again, crashing to the floor again, this time the bourgeoisie pushed everyone and everything into the toilet bowl.

3. The bourgeoisie, once and forever drunken frat boys that they are, always forget the lesson they never learn.  They always forget that you know the racket's gone pear-shaped when some economist, or journalist, starts announcing:  "This time, it's different.  This time the business cycle has been conquered." 

Every time is different for the bourgeoisie but it's always the same because they are the bourgeoisie.  Deja-vu is the closest the bourgeoisie get to comprehension.

This time is the same, this time is different.  This time, in 2009,  the bourgeoisie slashed capital spending, like the last time, 2001.  Unlike that last time, however, the constraints on capital spending lasted only two years.  This time like the last time, a new peak in capital spending was reached.  Unlike the last time, the new peak was reached in only five years.

This time, like the last time, net PPE declined.  Unlike the last time, the decline lasted only a single year.  This time net PPE has continued to accumulate so that by 2015 it was 23 percent above its previous peak.

4. That, the net PPE, is a lot of weight to be carried by labor-power, particularly as the labor-power declines disproportionately to the capital applied to the production process.  Then the production process and the value-process, the valorization process, of adding increments of additional value, contradict each other.

Like the last time, like the last recovery, this recovery has been based on driving production worker wages down from previous highs.  Last time, the recovery meant driving production worker wages back from the year 2000 high. This time it has meant driving the wages back from the 2007 high (which itself was still below the 2000 peak).

Like the last recovery, this recovery is driven by the reduction in number of workers in production, and the mass of production workers' hours utilized to animate the capital accumulated in the net PPE.

Like the last recovery, this recovery has not reversed  this burden on labor power; has not driven increases in production hours, the number of production workers, or the mass of production worker wages.  Between 2000 and 2014, the number of production workers, and production worker hours have declined 33 percent.  The sum paid out in wages has declined 4 percent.

This "recovery," the one since 2009, adorned with record profits, is a recovery boosted by extra increments of surplus value extracted from fewer workers, a lower wage bill.  It is limited by, and running itself into exhaustion by reduced production hours.

In 2014, production worker hours were only 7 percent above the low point of 2009.   This is the signature of a system where the distinction between recession and recovery has all but disappeared. 

The reduced production hours are both product and producer of a system where proportionately smaller increments of new value are embodied in the mass of commodities.  Capitalism moves around an axis where commodities, as values, are more difficult to produce because of the ease with which useful objects can be produced.

5.  Like last time, this time the problem is that the value-process and the production process are in opposition.  The opposition cannot be resolved by capital.  The opposition is capital in its full development.  The bourgeoisie cannot liquidate the value relations embedded in the means of accumulation without liquidating the physical existence of the means of accumulation.  Failed states, war without end, austerity now and forever, the permanent refugee economy-- pulverizing human labor power, and the human existence that surrounds, it by unleashing social movements of thugs, goons, arsonists, realtors, scam artists, all nostalgic for a glory that never was and the misery that always is, that's the bright shiny future for the bourgeoisie.

For everyone else, the way ahead begins with the liquidation of that class and its property.

S. Artesian
April 17, 2016