The majority of Americans who voted, at least in the swing states, have voted for the republicans. Why? Do the republican policies reflect popular opinion? Or is it that their vibes are more aligned with the public? Or maybe people are worse off now than they were 4 years ago and are hoping to turn back time? As a non-american I don’t quite get it. People must think their lives will materially improve under the republicans, but why?
The tendency for the rate of profit to fall.
I mean, yeah, it looks like Kamala didn’t get the dem base out to vote for her because no one wants “more of the same” when following an incredibly unpopular president. Kamala was very openly telling the base to fuck off, and made her race singularly about attracting white, upper middle class suburban women at the cost of everyone else.
But that’s the micro view. In the macro view, Michael Roberts’ analysis of rates of profit shows it’s been falling for a while now. Capitalism was in crisis during the Great Depression, only to be “saved” by WW2. The reconstruction of the industrial world led to good times for a couple decades until there was a profitability crisis in the 1970s. Capital’s response starting the 80s was offshoring, privatization, and financialization - neoliberalism in other words. But the gains from that was only able to keep things going until 2009 or so. Since then profitability has been shit. Capital has no answers beyond just tightening the screws (austerity at home and imperialism abroad). Just increasing misery in order to slow the decline of the rate of profit.
The US needs that surplus value extracted primarily from the global south to keep running. That surplus value is how capital is able to buy off the domestic working class. But that slice of the pie keeps shrinking, i.e. material conditions keep worsening. Things are getting worse as every year goes by and everyone knows it, even if they don’t understand it. That’s why we keep bouncing between parties every four years instead of the steady 2 term presidents we had in the era of neoliberalism. Most people are not doing in depth political analysis. They are just seeing their situation get worse and blaming whoever is in charge.
Of course the economy won’t recover under Trump. It will almost certainly get worse, and I happen to think the odds of a major economic crisis are pretty high. I would bet everything we get a dem president in 2028. Things just get worse and people are fumbling around for a solution.
And that’s where we come in. WE HAVE THE ANSWERS. It’s our job to bring the light of Marxism to the world. I’m not even gonna pretend we can make much of a dent in 4 years but this is a multi-generational project.
Thank you for that. Makes too much sense and feels like the big picture to put these things in context.
Would you be and to share some resources which helped you to this conclusion? No pressure if not!
Would be cool to see this on a graph somewhere (although I can imagine we can see the correlated variables react in kind). That’s the problem of trying to sell the future and having the “promise” of future value. Seems with Trump in power, corporations will eat but since that value has to come from somewhere. Like you alluded, from the global South or from tightening the working conditions of the workers. And it probably still not be enough to “fix the economy”. There is serious cost to inaction on our part that the future will pay.
Sure thing. Regarding the rate of profit, it’s something Roberts talks about a lot, so if you go to his website and search for “rate of profit”, you’ll find many articles (and graphs).
Regarding the extraction of surplus value, that one’s a little trickier. It’s a key part of what’s in volume 2 of Capital, specifically in chapter 6 (but the chapters before are important to comprehend as they build up to ch. 6). Long story short, it is only in the sphere of production (i.e. making things) where surplus value is created. So any costs that are not directly a part of production are “unproductive” and thus must be covered by surplus value. At the individual firm level this is often called “overhead” or “indirect costs”.
But at the economy level… what about the US? We don’t make anything anymore, so where is our surplus value coming from? Production in the global south! The value is created there but it is “imported” into the US. This is plainly obvious when you consider how much it costs to make a t-shirt in Bangladesh and what it ultimately sell for in the US. (I am admittedly mixing surplus value and profit a bit here but I think it’s appropriate).
How that surplus value makes it to workers indirectly is a bit abstract. But it can be done politically or through action. Meaning, you can pass a law that grants universal health care to pacify workers. Or the workers themselves can go on strike and earn more. Or even just through market forces this can happen. It’s a hard thing to empirically “prove” but it’s something you can see historically: when capital faces pressure, they have mechanisms to redistribute surplus value. In England, there was an increasingly militant labor movement that was eventually bought off by England ramping up imperialist plunder in the second half of the 19th century. In the US, up until the early 20th century you could always just steal more indigenous land and give it to workers (stealing capital and distributing it to workers isn’t the same and sharing surplus value per se but the effect is the same).
I get you (I think). Seems you’re claiming at some point, surplus value can be shared across people who are willing to fight for it. Either via legislation, lobbying or through direct action.
Appreciate the recommendation of the blog… it’s a great rabbit hole and I think I got the graphs I was looking for…
(Edit…The graphs didn’t copy properly… I was referring to the ones here: https://thenextrecession.wordpress.com/2024/11/02/the-us-presidential-election-part-one-the-economy/)
That rate of profit seems like a powerful metric. That scarcity mindset is never a great thing for an economy or even the psyche.
Thank you for the detailed response! Look like I need to move Das Capital up my reading list.