There was a little aha moment when reading Kali Akuno et al, specifically this part:
Marx demonstrated that as capitalist production develops and advances, competition and the need to secure greater productivity from workers drives the adoption of more productive, labor-saving technology and techniques that replace workers with machines. When labor-saving techniques are introduced, more of each dollar of capital expended in production is invested in machinery and other tools of production, while less is used to hire workers. But the increase in productivity does not cause new value to be created. According to Marx it is workers’ living labor that adds all value to commodities (whether goods or services), and the exchange value of a commodity in the marketplace is determined by the socially necessary (average) labor time required to produce it. Every average hour of labor required to produce a specific commodity yields the same amount of value, independent of any variations in productivity from technological advances.
Since technological innovation decreases the socially necessary (average) labor time required, it decreases the value of the commodity. The same amount of value is spread out among more items, so the increase in productivity causes the values of individual items to decline. As things can be produced more cheaply, and because they can be produced more cheaply, their prices tend to fall. Due to competition, companies must lower their prices when production costs decline. If they don’t, they risk a significant loss of market share or even bankruptcy when competitors cut their prices in response to reduced production costs. As a result, the amount of surplus value (profit) created per dollar of capital invested, the rate of profit, necessarily falls as well. The reality is that productivity increases under capitalism produce a tendency for the general rate of profit to fall.
Since the 1960s and more intensely since the 1990’s, we have witnessed capital’s steady incorporation of automation, computerization, and digitization into the commodities production process. The mass introduction of containerization, computer numeric control (CNC) production, and digitization have displaced millions of workers from the global labor market. And with the introduction of the internet and cell phone technology, etc., there are hardly any people left on Earth who aren’t being directly impacted by this rapid technological change
But capital’s ability to reproduce itself and expand, depends on the accumulation of surplus value, a portion of which must be reinvested in means of production and labor. In more stable periods of capital accumulation, the crisis of realizing profits which is endemic to capitalism is moderated. But the general tendency of decline in the rate of profit, or accumulation of surplus value, forces efforts to bridge the gap between needed and actual rate of profit through extreme measures. Some of the extreme measures capital employs to reproduce itself include the deployment of vicious social control strategies like neoliberalism, which call for austerity and the privatization of social goods, or fascism which calls for political terror. Both of these strategies are designed to discipline labor and make it more compliant, drive down wages, and enable the plunder of natural resources more intensely and efficiently in order to restore profitability.
and even more specifically, the part where he wrote "Since technological innovation decreases the socially necessary (average) labor time required, it decreases the value of the commodity. The same amount of value is spread out among more items, so the increase in productivity causes the values of individual items to decline."
Amazing! It feels good when it a concept clicks.
The part I was missing was the direct and non-negotiable link between labor and value, which I suppose is pretty important concept in Marxism.
Nice!
What really made it click for me (and surprisingly few others in the profession) is that as a civil engineer, today’s technology allows me to do the work in a day that would take a team a week a few decades ago (e.g. drafting, gis, digitized plan sets, etc). But wages have overall been relatively driven down- especially in civil engineering - where tasks are more akin to “labor” tasks (analyzing, drafting and preparing a plan set using hardware and software owned by a company), vs “professional/managerial” (project management, supervisory). But the majority of engineers still view themselves as “professional/managerial” and thus are resistant to collective action.
Boring engineering profit analysis
When one prepares a “bid estimate” for the number of hours they’ll work, it gets multiplied by an hourly rate and a “markup”. If an engineer is curious enough (and few are, unfortunately) they can back calculate what they “bill” (ie what the company gets paid) vs what’s received by them in compensation (wage and benefits). And then can compare that to the “billable rate” of, for instance their supervisor, and see that those who work the most hours and actually “produce” work are compensated the least (eg drafters/techs, early careerists, surveyors). But yet the primary thing that the managerial and overall corporate structure provides are access to the tools (drafting software, gis, survey equipment), professional insurance/counsel, and health insurance that are otherwise cost prohibitive to the engineer to acquire if they’d perform their own work. However the managerial/corporate structure do not actually produce any of the “products” that the company actually sells.And so if, due to tech advancements, a staff member performs the work of 5 staff (ie produces 5x the deliverables or at 5x the pace), then it would follow that the company would see >5x the profit because of that efficiency. However, profits are driven down by “low bid” systems and generally underfunded infrastructure, and so engineers are tasked with doing more and more with the same tools.
So the increase in efficiency of the tools, while maintaining a “presentable” profit margin for the company, ultimately presents minimal benefit to the laborer who does not themselves own the tools. And when the market tightens (as it has been and increasingly so since Covid, and will increase further due to climate change combined with aged infrastructure) these profits continue to fall for the companies and in order to maintain a “presentable” profit margin management tasks labor to produce more still and use “magic silver efficiency bullets” like “AI” to try and pick up the slack.
But ultimately none of these fix the systemic issue of a lack of public funding. The lack of funding stems from a reduced tax income from an overdrawn tax base (since most taxpayers are also on the receiving end of capitalism) not wanting to raise taxes to support infrastructure which does not benefit them directly, and capital does not want to spend any of its profit on maintenance and replacement.
And so bottom line - profit is extracted from the labor of workers and siphoned to owners - owners do not reinvest this profit into the society and create nothing of value themselves - and so as capital consumes itself and runs out of ways to exploit the workers the profit inevitably falls.
And as that falls far enough - it becomes socialism v barbarism - either abolishing capitalism or oppressing workers to a precarious enough position where they can be exploited and further profit can be squeezed from them (eg prison, deportation/“citizenship”, un-abortable pregnancy, etc).
Thanks for this comment, I find it fascinating to read about applications of practices / concepts in fields I'm not familiar with.
You bet! Not sure it’s done me much professional good to beat the drum on this particular issue - but I fear how public infrastructure proceeds to be commodified like healthcare (eg directly tied to the whims of capital) and the affect that has on marginalized communities. Idk.
The world needs lots of reform and imo land/infrastructure reform will further grow to be a battleground in years to come as the climate gets less amenable to existing infrastructure and land use practices