Fewer downvotes if oscilloscope can explain why "capitalism" (or specifically let's say the US implementation) raised median wages for a period and then, didn't.
I haven't read Marx, but if you two have, then maybe you can explain what feature of the Immiseration thesis is acting here, what changed when in the economic or political landscape, etc., in order to correspond with the evidence.
As far as the crisis theory goes: is it true that workers' wealth was destroyed more than let's say upper-middle-class to upper class wealth? Stock prices declined a lot more than home prices in 2009. (Important because the medium and lower quantiles' wealth is mostly the house—but higher quantiles own liquid assets like stock shares. Some of the lower quantiles also have pensions coming to them; pension funds invest in equities and bonds and CDO's and other things. I don't know if pension funds experienced a greater hit than, let's say, hedge funds (which only take top-quantile money).) So in order to justify that "the workers" lost more wealth than "the rich" (who, obviously, have more to lose)—I'd want to see some numbers on decline in home values versus other assets, as a start.
If you haven't read Marx, then I'm not interested in having this discussion with you, sorry. It'd take far too long to even get basic terminology straight. Here is a copy of the "Grundrisse der Kritik der Politischen Ökonomie" which introduced this theory: http://www.marxists.org/archive/marx/works/1857/grundrisse/
Plenty of online forums are more than happy to provide you with a basic outline of Marx's theories, including /r/communism101 and /r/debatecommunism.
> is it true that workers' wealth was destroyed more than let's say upper-middle-class to upper class wealth?
I will point this out though: this question does not make sense in a Marxist analysis. There is no 'middle class' or even 'upper class,' these are vulgar economists' terms.
Surely you can answer my question why the wages went up and then down.
oscilloscope posted a part of Marx's theory that's hopefully topical and has some insight to share with those of us who haven't yet set aside the time to read something long. It doesn't seem unreasonable to me to want to discuss that.
harvey
Thanks for the references, I will keep them in mind. I love video lectures.
There is no 'middle class' or even 'upper class,' these are vulgar economists' terms.
OK, all I intended was rough percentiles. Let's say the 30th–60th percentiles are "all house", 60th–99th are "house and equities", and >99th may be invested in a hedge fund. Speaking of the USA.
I don't mean to imply some unified psychology to a social class, or anything like that.
> Surely you can answer my question why the wages went up and then down.
You wouldn't even understand an answer I'd give you, because it'd be in Marxist terminology.
Maybe Oscilliscope will be willing to explain their comment, I don't care to at this time.
> Thanks for the references, I will keep them in mind for the future.
No problem. Glad to be of help. I think that understanding Marx is really important, but I don't think that he has correct answers for today, exactly.
> all I intended was rough percentiles.
Right, this is fundamentally wrong. The only thing that matters is your relationship to the means of production: 'middle class' people are proletariat just like 'lower class' people are. It has absolutely nothing to do with your positioning in the table of income.
This is an example of the terminology issue. It's common to most philosophers.
The only thing that matters is your relationship to the means of production: 'middle class' people are proletariat just like 'lower class' people are. It has absolutely nothing to do with your positioning in the table of income.
I understand what you mean. I can see how that relationship might be important to the theory. But what I said about "classes" (bad word: s/classes/quantiles/) is actually true. So if we're going to discuss whether, in fact, workers lost more wealth than capitalists (or, s/capitalists/correct terminology/), those empirical issues should still be addressed.
For example, I may be a "worker bee" consultant at IBM, but holding stock factually altered my exposure to wealth shocks.
You wouldn't even understand an answer I'd give you, because it'd be in Marxist terminology. Maybe Oscilliscope will be willing to explain their comment, I don't care to at this time.
> But what I said about "classes" (bad word, s/classes/quantiles/) is actually true.
It is true within the framework you have set up to analyze the situation. One of Marx's theses is that that analysis is not adequate to explain capitalism's tendancy towards crisis, the falling rate of profit, the alienation of the worker, and many of its other features.
You're saying "but no, it's true that you can measure things in degrees" and Marx is saying "my theories and equations are all using radians."
Right, but you have a chart that only takes into account wages which ignores things like 'wars' and 'embargoes' and 'happiness index' and doesn't even cite its numbers, and a vague hunch about relative values of securities. Really, all of this is far too muddy on both of our sides, combined with said terminology gap.
I really should be coding, not typing on HN, so I'm going to gracefully bow out of this conversation, but thank you for continuing it, you've been great. Two thoughts as I leave you: 1. the fact that many people have things like stocks in their 401Ks is one of the reasons that I think Marxist theories need updated, though I think of them as generally sound. Luckily, many people have since Marx's time (First Lenin, then Mao, and many, many others) and 2. Marxism is really about a methodology than a strict set of answers: you use the tools of dialectics and historical materialism to produce a scientific analysis. That applies to Marxism itself as well, and like any science, its theories will come and go, be made stronger or weaker as history marches on. That's not a flaw, it's a strength, and it's why Marxist analyses have been used across a variety of fields, not just economics.
Thank you for this break as I work on the documentation for the impending Rails 4 release.
=) You're welcome. Have fun and I'll get back to work as well. I agree that stocks and mortgages don't capture happiness, wars, and so on.
For anyone who cares to pick up the thread, steveklabnik has left you with:
Marxism is really about a methodology than a strict set of answers: you use the tools of dialectics and historical materialism to produce a scientific analysis
>Right, this is fundamentally wrong. The only thing that matters is your relationship to the means of production: 'middle class' people are proletariat just like 'lower class' people are. It has absolutely nothing to do with your positioning in the table of income.
I do think it's interesting to look at class from the Marxist perspective, but eh, the Marxist terminology I know is sloppy and inexact at the intersections of class; where a whole lot of the action happens.
Petite bourgeoisie refers both to me, the owner-operator of capital goods who must add his labour in order for those capital goods to produce value, as well as to those who own nothing but manage everything; managers of large companies who might not own any stock at all except for the options given as payment, people employed by the capitalist class to do the actual work of managing capital (and yes, it is complex and difficult (difficult in the sense of difficult to get right, not difficult in the sense of physical difficulty) work.)
I can not imagine two classes of people who are more different. I mean, your owner-operators? The means of production we own? we know intimately and control absolutely. Sure, we might take on apprentices from time to time, and we might delegate some of the less critical work, but room for delegation is limited, mostly because any mistake or misfortune that decreases the value of the capital good we operate generally harms us directly. I still assemble all my servers, because nobody else cares about 1 in 10 or 1 in 100 errors introduced by improper ESD control. But me? I care because I'm the one who has to get up at 4am and deal with the problem. I'm the one who has to make apologies to the customers, and I'm the one who gets to watch my customer base shrink when those sorts of problems happen. So yeah; I'm sure I could pay some kid ten bucks an hour to assemble servers... but generally speaking? I don't. I have people I trust with root that I won't let touch hardware. It's better, sometimes, to do some things yourself.
Your managers? Generally, they have much broader and shallower knowledge. They are all about delegation; not only delegating the decisions, and the work, but also delegating the risk. If a manager screws up, the worst thing that might happen is that they lose their job and any future compensation, usually not even that.
Managers? Managers control the largest corporations around. Owner-operators, usually, control very small operations.
Moreover, the Manager's customers are the owners. Really, the Manager only needs to be perceived as compitent by the capitalists that own the company; the perceptions of the employees and customers don't matter except in how they change the perceptions of the capitalist-class owners of the company.
Personally, I would argue that this manager class; those hired by the owners to manage what the owners have no time, ability, or interest in managing, are now a more powerful class than the actual owners. Mutual funds and index funds are very popular. How many here actually vote the stock they own? Not many, I'd wager. The Managers control most corporations, really, to a greater extent than the owners do. I mean, yeah, every now and again, one of the capitalists tries to fight the managers; even when the capitalist is clearly right he often loses to the manager.
> the Marxist terminology I know is sloppy and inexact at the intersections of class;
I would say that your definition of 'sloppy and inexact' is sloppy and inexact. ;) But that's slightly trolling. The definitions are pretty simple, I'd argue that you're meaning to say that you don't feel they map to today's class structure cleanly.
> I can not imagine two classes of people who are more different.
There's two things about this: 1, in Marx's time, this was generally much simpler. Things were more clear then. 2, the idea is that your incentives are the same: you'll be upholding bourgeoisie society. The whole point of the 'petite bourgeois' designation refers to the awkwardness of a group of people who _should_ be proletariat, but have juuuust enough incentive to act against that interest, because they're almost bourgeoise.
That said, point #1 is why I prefer to talk about later thinkers who have modified and extended Marxism over the years, rather than stick to Marx's teachings only.
>2, the idea is that your incentives are the same: you'll be upholding bourgeoisie society. The whole point of the 'petite bourgeois' designation refers to the awkwardness of a group of people who _should_ be proletariat, but have juuuust enough incentive to act against that interest, because they're almost bourgeoise
It's more complex than that. And the explanation I always got was that the petit bourgeois acted against their own interest because they aspired to be and thought of themselves as likely to become part of the capitalist class, not that they shared real interest with the capitalist class.
Management actively steals from the capitalist class. The last thing that management wants, for instance, is shareholder rights. In fact, they side with labour more often than they side with capital, as far as I can see. Look at Yahoo in 2008. Any fool could have seen that the Microsoft buyout offer was the best yahoo could do. And Yahoo shareholders clamoured to make the deal. But management killed the deal, siding with the employees, and destroying a great deal of value for the capitalists.
One can argue, in fact, that labour rights (which is to say, making it more complex and legally dangerous to hire or fire someone) is in the best interest of management, as it means that a Capitalist would have to learn significantly more before they could take an active role in managing what they own.
Owner-operators... culturally, you see that same aspiring up against our own interest. Our interests are aligned with the capitalists on labour issues, certainly; Much like the capitalists and unlike management, we want to be able to hire and fire without complexity, and as a class, we generally don't value job security, or really even comprehend why job security is such a huge deal to the workers. But otherwise? We have radically different interests. Owner operators are just as likely, if not more likely to need 'safety net' type social services than similarly skilled workers. One can make a good argument that owner-operators benefited more than any other class from the affordable care act.
In fact, on one of the biggest issues of the day, owner-operators have interests aligned with the workers against the capitalists: Capital gains taxes. Nearly all owner operators, outside of real-estate, pay full income taxes on most of their income; We'd be better off if the government taxed all income as income and just lowered the income tax rate to make up for it. And the difference in what you pay is huge. Like more than 50%. This is the primary reason why everyone thinks that an exit strategy is so important; building up a company that can be sold to a capitalist is the most realistic way for an owner operator to pay that lower capital gains rate. It's hugely damaging, too; it makes us act like management; like our customers are the capitalists rather than the people who buy our products or services.
Capitalists and management (through stock grants/options) get to pay the (much lower) capital gains rate on most of their income.
"Surely you can answer my question why the wages went up and then down."
Pretty funny - explain some complicated topic that scientists have probably been debating for decades in a HN comment. While you're at it, could you also explain Quantum Mechanics to me, I always wanted to understand how that works.
I will point this out though: this question does not make sense in a Marxist analysis. There is no 'middle class' or even 'upper class,' these are vulgar economists' terms.
Not quite true. I would label the middle class as the portion of the proletariat or petit bourgeoisie with some savings or even investment income to keep them afloat.
The issue being that the middle class and the "poor" proletariat have different relations to swings in currency and investment values. Inflation, for example, is good or neutral for the portion of the population who live month to month or remain consistently in debt. But the middle class have net savings, which inflation destroys. Likewise, low inflation or even slight deflation is good for the middle class, who have savings and small investments, but strong deflation is good only for the "true" capitalist class.
In the period 1947-1970 where wages were increasing, I don't know. Perhaps it had to do with legislation like the G.I. Bill, which increased human capital during that period and could have helped trend wages upward:
America is not a pure capitalist society. We have free public education, for instance. Capitalism also has obviously good effects, such as increased productivity and relatively efficient distribution of goods and services without central control. Profits from these effects can be distributed in the form of wages, if that's what employers choose to do.
In terms of the crisis, again I'm not sure. You'd have to consider not only the losses of the crisis, but the gains of the boom. Who benefited from the boom, and did those gains survive the bust?
19th century Marxist theory doesn't have the answer, but it frames these issues in an important way. Rather than crises and falling wages as abberations from normal steady growth, they are considered part of the capitalist system.
For a more modern perspective in the Marxist tradition, check out Max Weber or Georg Simmel. There are even radical, almost psychadelic strains of Marxism like Foucault, Deleuze and Guattari.
> America is not a pure capitalist society. We have free public education, for instance.
Surely Marx would still say that, because the means of production are privately owned, resource allocation is provided through a market, and wage labor is dominiant, that the states would be still absolutely captialist, no? "Free public education" doesn't really matter.
> Capitalism also has obviously good effects,
Certainly, and I think this is something that we should keep repeating to people who don't know Marx.
> There are even radical, almost psychadelic strains of Marxism like Foucault, Deleuze and Guattari.
Are the means of production privately owned? It seems to me that one of the most important means of production in the 21st century is computing.
Computational power is cheaply available and open-source software is free (as in freedom). With the internet, anyone can acquire knowledge, distribute a good, or work remotely.
Google, for example, has some of the largest computing clusters on the planet. This entire website is dedicated towards creating a vision of computing that is privately owned and used by capitalists to extract surplus value. Not to mention most of the backbones and actual physical wires.
I think there are gray areas, for sure, but the factories, the land, much of the computing, most of the telecommunications infrastructure, etc are all privately owned. The vast, vast majority is.
Of course. That's why I used the word "implementation". But I thought you had some kind of Marxist critique in mind that relates to some of the capitalistic aspects of the USA. (Since that is what this article is about.)
19th century Marxist theory doesn't have the answer, but it frames these issues in an important way.
Can you describe how you think it frames the present topic?
I haven't read Marx, but if you two have, then maybe you can explain what feature of the Immiseration thesis is acting here, what changed when in the economic or political landscape, etc., in order to correspond with the evidence.
On the broad whole, over multiple generations, "capitalism" seems to have been good for workers: http://25.media.tumblr.com/tumblr_lzdx1tJidd1qc38e9o2_500.pn... (via @delong)
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As far as the crisis theory goes: is it true that workers' wealth was destroyed more than let's say upper-middle-class to upper class wealth? Stock prices declined a lot more than home prices in 2009. (Important because the medium and lower quantiles' wealth is mostly the house—but higher quantiles own liquid assets like stock shares. Some of the lower quantiles also have pensions coming to them; pension funds invest in equities and bonds and CDO's and other things. I don't know if pension funds experienced a greater hit than, let's say, hedge funds (which only take top-quantile money).) So in order to justify that "the workers" lost more wealth than "the rich" (who, obviously, have more to lose)—I'd want to see some numbers on decline in home values versus other assets, as a start.