Part III
A Flawed and Incomplete Model* By Albert Recio
James O'Connor's effort to reformulate the analysis of
capitalism to include its relationship to environmental issues
deserves the praise of all of us who are trying to construct an
analytical framework that permits us to understand the world in
which we live, and who reject the academy's sweetened and
conformist vision of the present social system. However, the
praise worthiness of his effort does not mean that we cannot
criticize it with the aim of endowing his theses with greater
analytical precision. This is the spirit in which I undertake
these comments.1
O'Connor posits that the dynamic of capitalist economies is
affected by two kinds of contradictions that impede their
development. The first has its origin in the tendency for labor
costs to decline, provoking a fall in effective demand and the
appearance of a crisis of overproduction. The second
contradiction, which is his original contribution, is
characterized by an increase in the costs of production owing to
the problems generated by what he (following Marx) calls
"conditions of production," among which the natural conditions of
production are particularly important. In this case, the crisis
would manifest itself as an increase in production costs, or a
crisis of profits. In my opinion, this treatment of the problem
is overly schematic and does not permit adequate consideration of
the constrictions and tensions to which capitalist economies are
subject.
Presenting the capital-labor contradiction as a mere problem
of insufficient demand ignores many of the problems that arise
within the world of labor. Marx wrote about the dual character of
wages, which function both as a cost and as the wellspring of
effective demand. When workers manage to obtain wage increases,
there may be a crisis of profits (a "cost-push" crisis); on the
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*Translated by Ruth MacKay.
1 The paper to which I refer is a summarized version of an
article by O'Connor in the first issue of Ecologia Politica.
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other hand, when wages decline too much, we may see the type of
crisis postulated by O'Connor (a Keynesian-type crisis). Even in
the latter case, the decline in wages does not automatically
provoke a realization crisis, as long as the fall in workers'
demand for consumer goods is offset by the increase in demand in
other sectors (luxury goods, investments, public spending, etc.)
The importance of this last point is crucial for understanding
capitalism's bonanza in the latter half of the 1980s. Indeed, the
question of profit is not limited to the realm of wages. The rate
of exploitation is always a relationship between the product
produced and the cost of labor. It is possible for an
"appropriate" salary level to be unaccompanied by "appropriate"
labor behavior, translated into falling productivity and
profitability, without there necessarily being problems of
demand. This indicates that the problems posed by the labor force
with respect to the workings of capitalist economies are more
complex than O'Connor's argument suggests.
His overly schematic approach is part of an interpretation
of the dynamics of capitalism which assumes workers are merely
passive subjects who adapt themselves to the impositions of
capital and that market mechanisms are so strong that they
generate inflexible wage and labor discipline. I disagree, and
believe that accumulated historical experience has shown that the
capital-labor problematic has manifested itself in the wide range
of situations, some of which I have mentioned.
Nor does it seem appropriate to group together the variety
of factors he introduces as conditions of production, and I fear
that the attempt to construct a simple and symmetrical scheme
such as O'Connor's is uncritical (O'Connor himself is aware of
the difficulty of fitting a wide range of situations into a
single concept). One particularly unfortunate result, I think, is
the combination of those questions concerning the distribution of
net production among social groups (e.g., the distribution of
surplus between industrial business owners and landlords), as
well as those concerning issues such as the exhaustion of natural
resources. The importance and the manner of addressing these
issues can not be uniform. In the case of distribution, social
reorganization may come about, as, in fact, has occurred with the
fusion of industrial and real estate capital (which can be
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clearly seen by observing how new industrial investments are
financed through the reappraisal of old urban factory sites).
More important is the perception that capitalist firms try
to avoid certain costs, thus undermining the "supply" of a range
of inputs that are necessary for the productive process: a
workforce with a given level of capacity, a proper setting, and
so on. But it is not at all clear that these problems always
translate into problems of rising costs.
When discussing the development of capitalism one must
differentiate from the start between those problems that can be
resolved by "internalizing" costs (e.g., workforce qualification,
water purification) and those that, in both the short and long-
run, constitute fixed limits (such as all non-reproducible
resources). The former allow for varied solutions that do not
necessarily lead to greater costs; social and technological
innovations may make cost increases unnecessary. The latter are a
long-run barrier, a real contradiction between a system that
tends toward the expansion of production levels and a world with
limited dimensions.
Although it is true that, in the first case, capitalism's
imprudence can lead to temporary increases in costs, there are
other possible results, e.g., stagnant production (such as when
construction flags due to a shortage of qualified laborers),
which leads to a fall in demand or a shift in economic activity
toward the capitalist periphery. It is far less clear that the
long-run disappearance of a non-reproducible good is
automatically translated into increased costs, as is shown daily
in relation to the price of oil. Its price does not depend upon
the destruction of a "condition of production;" a complex social
web that determines the political balance of power sets its
price.
There is yet another question: Insofar as the ecological
disaster has not been caused only by capitalism, it is obvious
that our analysis must be broader. Those, like myself, who
believe that the capitalist system must be replaced by another
type of social organization, are not going to gain credibility if
we only try to explain how the capitalist system affects the
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conditions of production. In this sense, there is a need for a
broader theoretical framework that deals with these problems, and
with the kind of society that could overcome them. I have no
doubt that the Marxist insistence on identifying social relations
as the essential factor in the analysis of capitalism will
continue to reap results. However, we must broaden our horizon
and break with the habit of drawing from our own tradition alone.
In this sense, I think O'Connor's work raises relevant questions.
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