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Re: [OPE-L] [Fwd: Re: [OPE-L] basics vs. non-basics and financial services]

You may cite this message only if you do not disclose who wrote it. 

I must say that your position confuses me; one day you appear
sympathetic to Keynes, the other day you are saying pre Keynesian things.


On Tue, 4 Oct 2005 21:10:22 +0100
 Paul Cockshott <wpc@xxxxxxxxxxxxx> wrote:

Neither of these.

If the rate of profit is too low relative to long term rates
of interest capitalists decline to accumulate constant capital.
This prevents extended reproduction and, if nothing is done will
lead to contracted reproduction. In either case unemployment will
rise significantly.


I get this case. What is the other case?



State expenditure on unproductive activities can create additional
demand which allows simple reproduction to take place by converting
some of the output into commodities which are not accumulated.
This corresponds to a shift in the working population out of the
production of means of production and into  the production
of weapons etc.


Huh? This assumes full employment; there need not be a shift in the working
population.


The absorbtion of another part of the population 
in unproductive financial activities also prevents accumulation since
the people who work in stock exchange offices of banks are people
who are not working in factories producing means of production.


Yes but by giving a market to div i and div ii excess capacity can be worked off, possibly
creating the conditions for an investment led boom.

Do you agree with Keynes or not?

Rakesh



-----Original Message-----
From: OPE-L on behalf of Rakesh Bhandari
Sent: Tue 10/4/2005 4:26 PM
To: OPE-L@xxxxxxxxxxxxxxxx
Subject: Re: [OPE-L] [Fwd: Re: [OPE-L] basics vs. non-basics and financial services]

At 11:35 AM +0100 10/4/05, Paul Cockshott wrote: 

I agree that mature capitalist economies can have a tendancy to spiral
into unemployment, and that the expenditure of the state on  weapons
can prevent this. But it prevents unemployment by at the same time
preventing accumulation and shifting the economy from expanded to simple
reproduction.


Not following. Prevents higher levels of employment? And how is the
state preventing accumulation if the economy is already spiralling
into unemployment as a result of slow down in accumulation? Or are
you saying that the state causes that downward spiral by, say,
regressive taxes or the coddling of labor? Were Thatcher and Reagan
right?

rb



--
Paul Cockshott
Dept Computing Science
University of Glasgow



0141 330 3125

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