Companies are increasingly using the current low interest rates to buy out the competition.
In a hypothetic future scenario, isn't it possible for just a few giantic companies to emerge who take advantage of economies of scale to keep prices high and prevent technology developing constant capital to counteract the falling rate of profit?
Are we headed towards a dystopia where profit rates will be stable?
Yes, this has been slowly happening for years.
If you tell this to an Ancap they will actually really try to tell you that dis-economies of scale mean monopolies are unnatural
Its a fucking joke
Considering how wages are falling, that probably won't be a problem. Can't make a profit if no one can afford to buy your stuff.
sure you can. Most major companies have large treasuries these days. They just pull out their capital investments and put them into the stock market or real estate, the price artificially inflates due to the current monetary policy, and the company is still making a "profit"
Until that bubble collapses and we have a crisis
Fortunately probably not. Fundamentally our economy appears to be run in the interest of bankers rather than producers, and bankers just love to plough people with debt.
It's still a dystopia, but a bipolar one.
People can always buy your stuff with electronically created bank dosh.
(except for the part where everyone gets progressively deeper into debt.)
Fortunately politicians are too ideological to take even the token steps needed to avert another crisis, so capitalism might tear itself apart with centrifugal force.
All because neoclassicals are too scared of the fact that their mode of analysis is a ridiculous farce that owes more to religion than science.
Now you're starting to get it. Prices in modern capitalism are mark-ups anyway and the state will intervene as necessary to keep rates of profit high. Capitalism can actually go on forever, in spite of its contradictions, unless we do something about it.
Wages are only falling relevant to total economic activity though. In absolute terms, wages have stayed the same or slightly increased (and will continue to do so).
Except our wages today are worth less than what they were 30 years ago. Prices and productivity are rising while wages stay the same, and more and more people are working in low-paying, precarious service or 'gig' jobs.
I guess in a world where only a few companies remain workers would be more organized, because they'd all be working for the same companies.
Economies of scale also require a ton of internal planning, maybe showing workers that markets are unnecessary.
Hence why I said they are falling relevant to total economic activity. My point was that wages aren't literally going to vanish into nothing - rather the economy is getting larger while wages are relatively static. Thus workers are fooled into thinking that their wages have not decreased at all.
They're not gonna vanish, but the relative wages are going to fall, and they're gonna fall even more as well-paying jobs are automated, and that is going to lead to a fall in profitability unless the available spending money is inflated through debt, which is only going to delay the crisis as people are unable to pay their debts. Even if workers are 'fooled' into thinking their wages are the same, they're gonna feel the difference, and the broader economy is gonna feel the difference. You can't have a functional capitalist economy if people can only afford to sustain their day-to-day life and don't get richer.
Profitability will fall but profits will never vanish.
That's exactly what we have now though, it's what we've always had really.
When you factor in inflation and some other factors, they're closer to falling than static most of the time. Real living standards will drop, either way.
Gradually yes. But the end result will likely be an equilibrium where workers have just enough to live on, with wages staying proportionally the same forever.
Not really. In the past we used to see wages rise with productivity, but today wages have completely stagnated while productivity has soared. Capitalism needs to grow to survive, and in order to grow it needs a growing consumer base, but that's not happening. Hell, you can even see this by how the bourgeoisie are investing their money. They're investing them in the stock market and real estate and buying out other companies, not production, because there is simply no market to buy new commodities. Corporations are still making a profit, but it's no longer profitable to invest in production, and that's gonna kill capitalism.
Not a fatal situation by any means. The fact that corporations are investing less in production is actually good for them. It's more stable. Investing in stocks, buying out other companies this has always been the case. Not really a bad sign either. Wages can be raised if necessary. Companies can and do still raise wages occasionally. Increasing wages can create growth again.
It doesn't really though. Recessions are actually good for Capitalism (they're just bad for the workers). Recessions are like hitting the reset button. The boom and bust cycle will just go on forever because the state will always be there to dispense subsidies, bailouts, tax breaks and golden parachutes to keep things from collapsing.
No idea if it's possible but it's what Amazon's been trying to do for years now.
There's no evidence of monopoly power.
Read Capitalism by Anwar Shaikh.
Isn't that just confirming Marx's argument that capitalism leads to the immiseration of the proletariat?
Next you'll pull out the Kliman to "prove" there's no evidence of financialization
I do agree with Marx on his point. My only disagreement is in the area of the "inevitability" of Capitalism's collapse. Key to this theory was the notion of changes in the organic composition of capital but through intellectual property laws and other barriers to market entry the technology which changes the organic composition of capital can be monopolized by large cartels.
If you choose to ignore facts that don't fit your world view you're the dogmatic one.
arxiv.org
forbes.com
And if anything things have become more concentrated since the brief discussion in the media that the Swiss researchers provoked. But somehow if a company doesn't have majority market share then monopoly power and cartelization doesn't exist. The "proof" being that competition still exists even though the trend in average commodity prices has been inflationary in the 20-21st centuries rather then deflationary as in the 19th.
If there's no such thing as monopoly power then why do the countries where the monopolies dominant capital shares are headquartered run the world. Why do countries such as China resort to using the state power I.e.de facto monopoly and a substitute for private monopolies in order to compete on the world market. State-capitalism accelerates the process of gaining world market share and quickly creating large firms capable of competing with more effecient Western ones.
He was already revising his analysis over the 20 years that vol one came out to deal with the rise of corporate power in the late 19th century. His analysis is still the best one we have but do I think Marx would've maintained everything is the same as then? Hardly.
Shaikh isn't saying that there arent monopolies, but rather that this is not a new monopoly "stage of capitalism", and that splitting capitalism into "stages" bad marxism.
Why does someone so reasonable have such an unreasonable flag
For the meme, I'm assuming.