Theories of Late Capitalism - Essay Example

Theories of Late Capitalism Question Part In the immediate post-war period, the US Capitalist was keen to implement Keynesian-type policies in both international and local activities, provided economic conditions and political forces prevailing at the time permitted those policies as effective. Among the most significant conditions emphasized was the insatiable demand for United States manufacturers from both abroad and at home, and the lack of significant competition for the US labor and capital. The latter enabled the US labor force to demand for better benefits and wages while simultaneously enjoying higher employment rates (Harvey 189). The global market was significantly expanding in the late 1960s and early 1970s, resulting to rivalry on both the US labor and capital. Moreover, the post-war long cycles of expansion saw the US manufacturers investing enormously in fixed capital and capacity building such that by late 1960s, profits margins for these investors were beginning to decline due to the significantly high capital-labor ratio of operations. Rephrasing this, the huge amounts of “sunk costs” especially in the form of plant, equipment, or fixed capital, had enormous eroding impacts on their profit rates. These changes in the realignment of the global market and the actual production conditions led to the abandonment of Keynesian economics, contrary to what Keynesian and liberal partisan claims. Actually, it was globalization of capital and then labor, making the New Deal-type and Keynesian economic policies loose their favor to capitalist profitability, paving way for Neoliberal and Ronald Reagan austerity economics (Wallerstein 132). This is according to the theory of capitalist crisis, globalization, and theory of falling profit rates emphasized by Harvey and Frieden. The integral dynamics of capitalism lies at the center of the theory of falling profit rates. Capitalist competition pushes capitalist to search and introduce advanced production methods that promote reduction of costs per unit. The result is a significant increase in capitalization of production, what Marx refers to as “increasing organic composition of capital” (Harvey 195). Consequently, machines replaces workers, dead labor replacing living, leading to a fall in profit rates. Part 2 With the falling profit rates, political leaders sought to make some amendments to capital accumulation laws and regulation with an objective of increasing or maintaining rates of profits. These changes came in as state policies seeking to regulate capitalism, essentially raising the living standards of the working class and their working conditions and increase capitalist profits (Harvey 168). Consequently, capitalist states introduced social welfare cuts, geographic expansion of capitalist production, and a series of mergers, acquisitions, and bankruptcy. These policies brought together led to the revival of profitability, particularly in the US beginning early 1980s. Lean production generalization through service and industry significantly increased the rate of exploitation (labor productivity). The series of mergers, bankruptcies, and acquisitions was the primary source of the financial sector growth, leading to desertion of old and inefficient operations. Political leaders also enacted regulations to reduce production capacity in some industries such as steel production, leading to a shift of investment to other fields of production (diversification of steel production into oil exploration). The boundaries of the world economy expanded due to the construction of global production chains, enabling labor-intensive operations shift to low-wage regions in the global south (Postone, 15). The economic policies of neoliberal capitalist states encouraged capital restructuring. The deregulation of labor and capital markets, together fiscal policies that focused on disinflation, enabled capitalist firms to respond to rising profits with more equipment and plant investment (majorly inventory systems and computer machinery), as well as continuous work reorganization with emphasis on lean production. Part 3 Deregulation of capital boosted the growth of transnational production chains, while deregulation of labor (such as social welfare cuts) market led to increased competition among workers, contributing to the fall or stagnation of real wages. However, neoliberals’ policies did not conquer the global market smoothly: capitalist states had to repress “shock and awe” working class individuals in the global south and North (Wallerstein 124). This led to globalization of production and the consequent independence of global markets and businesses. Another long wave of expansion beginning in the 1980s was not permanent. The increase in profits led to fresh capitalist accumulation. Consequently, the increasing production capitalization led to a decline in rates of profits and ultimately the stagnation of mass profits. The changes in laws and regulation had an impact on the experience of time and space among individuals. The changes from the radical political economy started to spatial Marxism. According to Harvey, the study of spatiality revolves around the dynamics of capitalist development. He emphasized on the role of capitalization in the development of urban and suburban geography. Harvey reiterates that capitalist states and capital were the pillars shaping urban and suburban landscapes, and that the production of space is closely associated with capitalist development and accumulation. The policy changes led to competition in the labor market, creating a form of class struggle. The urban spatial development was a reflection of the class struggle (Harvey 226). Large industries established suburban manufacturing towns as a way to prevent unionized workforces in industrialized urban centers, a clear indication of how capitalists produced new urban spaces to respond to the agitation in working-class people. According to most Marxist economics and their political sympathies, the development and pattern of spatial urban and suburban geography depends primarily on capital, as the working-class population sought built environment that suit their needs. Part 4 The fact that Marxist geographers do not consider workers as actively contributing to the development of built environment is paradoxical. The primary interpretation of these geographers is in economical terms. Consequently, such interpretations conceive the working class in a reactive and passive manner, possibly capable of holding capitalistic grand designs of cities and capitalism geography, but not quite able to design and implement their own plans that may directly produce urban and suburban space for them (Harvey 223). Thus, the economic perspective of the capitalism geography completely disregards any influence of cultural and social practices of the working class nation. Harvey’s schema of urban and suburban geography explains that labor (workers) may use the build environment for consumption and reproduction, but it does not theorize workers as proactive agents with the capability to designing and implementing built environment as an integral part of their own self-reproduction. Therefore, their cultural and social practices are concepts that rely on the generational and daily reproduction on utilities presented to them by landscape, which is itself a product of capital in the reproduction process. The perception of economic interpretation (Marxist) thus presents an ontological capital privilege as the maker of space, only providing partial explanation of urban and suburban space production under capitalism, marginalizing the cultural and social practices of the workers and their institutions. Question 2 Part 1 Hegel account of the civil society advocates for determination of particularity, where there is free reign of satisfaction of subjective desires and needs. Nonetheless, the pursuit of selfish or private ends in an economy and society with minimal restrictions implicitly imposes universality in the variance of particular needs, to the extent that an individual’s welfare in society in bound intrinsically with that of others. This is because each individual requires the other in some way in order to conduct effectively reciprocal activities such as trade and commerce (Jessop 34). This system of interdependence, however, is not self-conscious, but rather exists as an abstraction from the pursuit of satisfying individual needs. Thus, universality and particularity have an external relation only. According to Hegel, one can perceive this system as a prime facie of external state, the need-based state, the state according to the understanding. Nevertheless, Hegel envisions the civil society as a realm of mediation of certain wills via social interactions, and a means that educates individuals through their struggles and efforts focusing on a higher universal consciousness. There are three important dimensions in the civil society: the system of needs, administration of justice, and the police and the corporation. The dimension of system of needs primarily involves the pursuit of satisfying needs. Human differ from animals in their capability to different and multiply needs in different ways, consequently leading to their luxury and refinement. Thus, political economy realizes the interconnections in the universalistic and social side of needs. Hegel perceives work as the principal mode of transformation and acquisition of means of satisfying needs, as well as the principal mode of practical education in understanding and abilities (Postone, 32). Moreover, work provides an ideal way in which people depend upon each other in their private pursuits, and the contribution criteria of each individual satisfaction of all the others. Essentially, the society creates a form of universal permanent capital that everyone can draw upon in principle, though natural inequalities among the individuals will result to social inequalities. The dimension of administration of justice revolves around the positing and objective existence of the principle of rightness in order to make it a civil law and legal binding. Personality and private property receive recognition and validity in the civil society through a rational legal system. Consequently, wrongdoing becomes an infringement on the holistic universal will existing in ethical life rather than a mere infringement of the individual subjective right. Thus, civil society returns to the concept of implicit universal unity with the subjective particular (Postone, 31). According to Hegel, the last dimension of the corporation and the police refers to the public authorities in the civil society. Apart form fighting crime, these public societies safeguard public utilities as well as regulation and intervention of activities that relate to distribution, production, and sale of services and goods in a society, or measures that protect the welfare and rights of individuals and the society in general. Part 2 Hegel’s account of freedom form his doctrine of moral freedom differs from Kant’s account of freedom in the Prolegomena. Principally, Hegel overcomes Kant’s a-priori, individualistic, and formalistic account of moral autonomy with his substantive, realistic, and social conception of moral subjectivity. The attempts by Kant to deliver an ideal moral subjectivity that embodied beings can actualize fails as he considers desires to be external forces controllable by our transcendentally, pre-formed free self must control to obtain absolute freedom. Hegel, on the other hand, considers the achievement of absolute freedom through desires. From this argument, Hegel differs from Kant because he integrates the natural interest of human beings in happiness into his perception of moral good. Additionally, Hegel argues that pursuing moral freedom without the chances of achieving happiness would definitely mean alienating ourselves from the world, to the extent that satisfying our concerns for living well would fail (Jessop 67). Therefore, Hegel successfully adopts Kant’s strategy of conceiving ethical norms as universal laws of freedom, though his doctrine indeed offers a provocative solution to the Kant’s Prolegomena. This is because his vision incorporates a substantive and realistic conception of human moral good, which is in direct contrast with Kant’s formalistic and a priori moral good account. Part 3 According to Hegel, government arises from three distinct levels: universal government, absolute government, and free government (Wallerstein 213). The ruling power is initially absolute, or the military class, and must rule all other classes besides itself. Moreover, the responsibilities of ruling reside with priests and elders, who Hegel perceives as indifferent to personal interest. Therefore, mediation relations are active in government rather than recognition (Fukuyama 317). On the other hand, the universal government exhibits separation of power, or system of needs (the economy) as what contemporary geographers would call. Here, Hegel provides some discussion over several issues, including avoiding amassing of excessive wealth, need for taxation, public infrastructure, the poverty problem, and extremes of business cycles. The second government system is the system of justice that functions as a universal class with administrators from the military class of absolute government. In other terms, this second government system functions as an indifferent universal person. The system of discipline is the third government system, whose primary functions include policing, military training, and education. Hegel adds another level over the separation of power, which he calls the free government (monarchy, democracy, aristocracy), though he does not provide further explanations (Postone, 34). Hegel’s conceptualization of the universal and the determine freedom is similar to Harvey and company in that they both envision freedom as the ultimate determinant of happiness and progress. However, Harvey’s and company fail to differentiate between potential freedom and inner freedom as manifestation of actual freedom. Part 4 This difference in understanding is evident in their interpretation of late capitalism and the potential to free the economy from effects capitalism. Harvey and group interpret late capitalism was the historical era when development of capitalist production mode was at its prime, where there was a contradiction between the survival of capitalist production relations and growth of production forces erupted, or assumed an explosive form. Consequently, this contradiction gave rise to a spreading crisis among these production relations (Jessop 51). In essence, Harvey and company attribute the crisis of the 1960s and the falling rates of profit to the capitalist policies that encouraged accumulation, resulting to a high ratio of capital-labor operations. Moreover, they constantly refer to the reproduction schemas in Marxist tradition. This presents a challenge, as there are no available arithmetic solutions prove the compatibility of harmonious growth with the capitalist laws of accumulation. Both versions present the same problem, which makes alternation of recessive or extensive long waves difficult. It seems in one case, the crises become incomprehensible, and in another case, the failure of the system to collapse becomes inexplicable. Works Cited Fukuyama, Francis. The End of History and the Last Man. London: Penguin Books Limited, 2006. Print. Harvey, David. The Condition of Post Modernity. Cambridge: Blackwell Publishing, 2004. Print. Jessop, Bob. The Future of the capitalist State. Cambridge: Blackwell Publishing, 2002. Print. Wallerstein, Immanuel. World-System Analysis: An Introduction. North Carolina: Duke University Press, 2005, Print. Postone, Mioshe. Time, Labor, and Social Domination: A reinterpretation of Marx’s Critical Theory. New York: Cambridge University Press, 1996. Print. Read More