cyRev Online Journal

From Das Capital to DOS Capital: A Look at Recent Theories of Value (page 3 of 3)
By Jerry Harris, Chicago/Third Wave Study Group

End of Commodity Production?

Virtually free technology produced with virtually no human labor it's certainly not on our doorstep today, but just as certainly, it's within view over the next century. The implications are the end of commodity production and the capitalist market, as we know it.

This is the conclusion reached by Marxist economist Vojin Dakovic in his book, Anti-Capital. Dakovic sees cybernetics and automation as the final stage of industrial capitalism. He argues that; "technology in the process of production also takes part as labor-power," creating a surplus or free form of labor which he terms "use-labor." Use-labor is cheaper, faster, and more efficient than human labor, and thereby replaces the worker.

In effect, this is what Business Week recognized when it discussed "near zero production." Marx viewed the amount of "socially necessary labor" as determining price, or the exchange value, of a commodity. But how do you price a commodity produced with essentially free use-labor? Dakovic takes this to argue that commodity pricing is at an end and use value should become dominant. "As use labor replaced living labor in commodities, its form of use value became dominant as the form of value of the product. The point of no return has been reached. Machines are well on the way to replacing human labor once and for all as a determinant of value, and by doing so they are making the system of commodity production obsolete."

Davokic thus differs with Marx in two key areas. He argues that technology contains a form of labor independent of the worker, and that this labor adds a greater amount of surplus value than the worker.

This not only undermines the commodity market, but also the labor market. Use-labor being superior to human labor means countries are facing permanent employment stagnation. Dakovic maintains that technology has become the driving force in the global economy. As he explains: "Bringing unlimited quantities of cheaper labor . . . technology has set the stage for the final battle for capital on the world market . . . [Not only] permanent stagnation in employment in the most competitive economies, but also each national market . . . has been superseded for all times as a framework in which economic growth is possibly based on a growth of employment." This onset of global stagnation and the elimination of human labor is the "coupe de grace to capital and the capitalist mode of production."

Knowledge as Value

Capitalism's answer to the crisis of global stagnation is to move into speculative financial manipulation. Today the development of commercial capital has so increased as to totally overshadow productive capital. Capital has fled to global speculation because investment in manufacturing is limited by global wage structures, which constrain consumption, and the growing unemployment produced by the technological revolution.

Although speculation has existed from the beginning of capitalism, today its use and size has reached an historic leap. The international money market by itself is forty times greater than the exchange of physical commodities, and this is just one of the dozens of speculative markets. The revolution in telecommunications and computer technologies is what makes this possible, creating a geosynchronized world market.

Because speculative markets operate on information and not production, they are part of the new knowledge economy, rather than the industrial economy of Marx. After all in Marx's formula, value was added to a commodity through the application of labor and the tools of production. Yet here we have wealth created with no use value there is no new commodity at the end of the process. Only increased wealth. Therefore capital has moved into totally unproductive and socially useless activity.

In speculation, money buys a very specific form of commodity, information, which is then turned into greater money. Since the information is enhanced by the new tools of production in telecommunications and computer technologies, the formula may be expressed as:

M -> I -> (il) -> I1 -> M1.
(mp)

That is Money buys Information to which is added the means of production and intellectual labor to produce enhanced Information which is used to make more Money. It seems clear we are looking at a different form of value than that produced in industrial capitalism. This applies not only to the speculative markets, but to the dynamic and growing sector of the economy where the exchange of information, knowledge and design is dominant. But when information is use to enhance a physical commodity or social service, then use value, rather than speculative value, is produced.

World financier and ex-chairman of Citicorp Walt Wriston argues that currency is no longer tied to physical commodities but to information on the global electronic infrastructure. Based on the reading of a nation's diplomatic, and monetary polices, international traders place a value on a country's currency. Therefore information, not the sale of assembly line products, actually determines speculative markets. These new markets are at the center of global capitalism. Wriston therefore argues that a new calculation of wealth is needed, one based on intellectual capital rather than on the production of things. Assets are no longer a drill press and lathe, but information. The power of this new economy was demonstrated by the recent crisis in Mexico, which overnight was driven into depression by the electronic removal of money based on an analysis of information by global financiers.

Globalization

Globalization of the world economy is one of the main results of the technological revolution. Some Marxists have begun to look at this as; "a new contradiction . . . insurmountable under capitalism." So argues Samir Amin in Monthly Review (April 1995). Amin approaches the question along similar lines as the Tofflers did in their 1980 book, The Third Wave. Both writers see an eroding of the national state as a result of the growth in a single world economy and culture. Amin observes that capitalism; "is inconceivable without a social and political dimension, which implies a state . . . Now, however, have we entered a new era characterized by a separation between the globalized space of capitalism's economic management and the national spaces of its political and social management?" Amin sees the current anti-government movement as part of imperialism's drive to dominant the world economy. There will be no borders or independent states, only vast areas of accumulation. Ca undermining itself in the mad pursuit of profits.

The Tofflers see the anti-state discourse as part of the Third Wave revolution. Economies, cultures, and borders cease to function as part of nation states as regions connect to each other through telecommunications. Cultural and economic networks create a global exchange no longer dependent on any centralized government.

For Dakovic the world economy is moving to a new stage based on the historic flowering of technological labor, destroying commodity production, profit rates, and wage slavery. He argues this sets the stage for communism, and a world economy based on use value.

Wriston also sees a single global market where "money is asserting its control over government, disciplining irresponsible policies, and taking away free lunches everywhere." This type of "disciplining" of the Mexican government has produced a disaster for people throughout the nation. But Wriston maintains that an economy run by global financiers is the best of all possible worlds because; "the ability to move capital is fundamental to the continuous efforts of mankind to live a better life." Of course guerrillas in Chiapas maintain a different point of view.

Outmoded Capitalist Market What is being recognized across the board is that fundamental changes are rapidly developing all around us. From capitalists like Wriston, to Marxists like Dakovic, and futurists like the Tofflers all agree something new is being born. These revolutionary shifts are occurring in five essential ways:

Knowledge has become the most important element in the production of value, rather than physical inputs.
Technological labor is dominant over human labor, and will continue to replace workers on a massive scale.
Speculative finance dominates productive capital as the largest sector of the global economy.
Globalization will undermine nation states as the basis of economic markets, ending the era of national capitalist development with the rise of a global bourgeoisie.
Economic shifts are creating social tensions which result in anti-government movements seeking to deconstruct the centralized state.

As we can see, fundamental changes are occurring in the mode of accumulation, the production of value, labor, markets and the political superstructure. But if Third Wave society is designed with the same values as capitalism, the above changes will reproduce existing inequalities. In fact, the dominant trends reveal growing dangers. Ethnic wars instead of local empowerment, the destruction of social programs rather than grassroots democracy, unemployment instead of shorter workweeks, and speculation instead of social wealth. The new society can only develop its positive potential within a new paradigm. The outmoded capitalist market will act as a straitjacket on the new forces of production. The ownership and monopoly control of information will be destructive to the growth of knowledge. The socialization of information, (in effect the new means of production), through free and democratic access is the only way to expand the new economic base in the most dynamic manner.

Only this can insure source of knowledge, and the productive use of information technology.
Business Week is already seeking to define what the new market may look like. In a society overloaded with information they suggest an "attention economy" where competition centers on a consumer focus. Roger Nagel, deputy director of Lehigh University's Iacocca Institute argues that since cost will be incidental to price, companies need to sell service. Says Nagel; "Tomorrow's factories will sell customer gratification, not things."

We can let the new era be structured by speculative greed, or we can struggle to define it from a cyber-socialist perspective. Visions of an ever-expanding consumer market where human gratification is defined by an array of products and services, crashes on the crisis of unemployment and poverty. Near zero production is only possible with near zero labor. You can't disconnect the two. The "attention economy" for the majority may be where to find food and shelter, while 20 percent of the population looks for new software. Only if technology is used to enrich us all can the crisis be avoided. A new historic era is being born, but class struggle will still determine its shape. The Third Wave market must be based on equity, social wealth, and valuing the worker who produces intellectual capital. If we approach the new society with the values and methods of industrial capitalism, a fundamental contradiction will be produced between the economic base and civil society. The results will poverty and political crisis. The future can and should be better.