What happened in globalisation?

By Humphrey McQueen

Humphrey McQueen is a leading Marxist writer in Australia and an activist in the Socialist Alliance. A version of this article appeared in the Journal of Australian Political Economy, No. 51 (Jime 2003).


Globalising capitals

Labour times




The nation-market-state

Summing up


Although capitalism, imperialism and globalisation are three of a kind, the paths by which imperialism as monopolising capitals might have moved to a newer phase are still not clear. Without that map, we cannot know whether we have seen the start of a qualitative change to the totality, just more of the same, or little beyond hype. The answer needs to be based on the mechanisms through which capital expands, that is to say, the application of labour-time during the circuits of money, commodity and production. Those practices are integrated when money provides a measure of labour-time, commodity-capital becomes one of its embodiments, and production-capital is the locus for its value-adding.

This article continues the questioning of whether the recent changes labelled globalisation are a distinctive phase in capital growth. Of course, new things happen; otherwise capitalism would never have come into being and there would be no chance for socialism. So it is possible that the past twenty years have brought a qualitative difference to capital expansion, just as its monopolising did a century ago. Imperialism need not be the last stage just because Lenin's "novishii" was translated as "highest" rather than "newest". Alternatively, recent amendments, such as the unravelling of tariffs as the prime form of protectionism for manufactured goods, may prove to be only a blip within that monopolising.

Globalising capitals

"… it is colonies that created world trade, and it is world trade that is the precondition of large-scale industry … Thanks to the application of machinery and of steam, the division of labour was able to assume such dimensions that large-scale industry … depends entirely on the world market, on international exchange, on an international division of labour."—Karl Marx, The Poverty of Philosophy, 1847.

Although the expansion of capital across the past 600 years has always had a global dimension, neither capital's extended reproduction nor its spatial spread has been uniform. In establishing a world system for accumulation, the three forms that capital assumes have moved geographically at varying rates. Money-capital went first, though often tied to commodity-capital through trade. The transfer of instruments for production came later, to remain the least pronounced. More common has been the dispatch of money and commodities to start up production. In addition, a primitive accumulation of capital has persisted in various zones up to the present. These shifting practices will be sketched around changes in the labour-process, notably the spread of wage-labour.

For thousands of years before capitalism, the class division of labour had separated those who must work for their living from those who can live without working. Probably for just as long, a social division of labour had divided farmers from pastoralists, and both from craftspeople. With the spread of traders and the growth of cities, the exchanges between food producers and manufacturers added more trades to the social division of labour. Much later, the widening moat between town and country also rejigged class relations away from feudal lord and serf towards capitalist and wage-labourer. These practices provided the matrix for the first two of five phases in globalisation.

Globalisation Mark I, with its plundering of resources at home and in the new worlds, centred on merchant's capital (commercial and money-dealing). To surpass the putting-out system that supplied a single merchant, capitalists began to produce for their entire market. Most labour remained forced, often enslaved, despite more craftsmen operating outside the guilds.

Mark II was a mercantilist era when more free, that is, dispossessed, labourers encountered the discipline of clock-time. Machinery in factories challenged manufacture, which relied on tools. Particularisation introduced a new, technical division of labour. The capitalist allocated labour to each part of a product and then to each of the steps required to fashion each part. For instance, some shirt-makers would work on nothing but collars, and among that group one would do all the cutting-out and another all the stitching. Gathered together, labourers on each task were driven to work at the same pace as each other. That rate became universal around each factory's locale, and then across entire industries in a national market.

Mark III was the freer-trade interlude in the nineteenth century with widespread casual labour in the metropolitan economies and indentured labour throughout the colonies. Slavery in the Americas and serfdom in Russia were being replaced by more flexible forms of bonded labour. Britain sacrificed its agriculture to get cheap grains that would lower the costs of reproducing factory labour. A new international division of labour saw British cotton mills supplying India with piece goods that had previously been spun and woven by villagers. During this third stage, elements from the second stage spread to other countries. For instance, the French revolutionaries in 1791 ended all guild masterships, making opportunities for journeymen. Factories in France took another fifty and more years to overcome the impediments to capital accumulation from the putting-out system, which did not allow for discipline over labour-times.

Mark IV (Lenin's imperialism, or monopolising capitals) saw the dominance of free-trading Britain drive its rivals towards protectionism. Meanwhile, because the financial might of the City of London derived from overseas banking, British manufacturers missed the benefits of finance capital, and were devastated by a return to the gold standard in 1925. Aristocracies of labour were challenged by the beginnings of Fordism within the application of continuous flows in production. Helmholtz's calibration of physiological response intervals in 1850 had allowed for the control of fractional units of labour-time, opening the way to bookkeeping as time-keeping, epitomized by Bundy clocks and Taylorism. Bourgeois economists abandoned Smith's concern with the feudal restraints on growth to devise methods for economising on the marginal utility of labour-time.

In 1915, N. Bukharin recognised that the "vertical concentration and centralization of production" (oligopolisation) meant, "on the one hand a diminution of the social division of labour, since it combines in one enterprise the labour that was previously divided among several enterprises; on the other hand, it simulates the [technical] division of labour inside the new production unit".1 Bukharin also appreciated the significance of the mass migrations that were redistributing "the main factor of economic life, the labour power". Throughout the twentieth century, the mobility of labourers around the USA, along with immigration, has been as significant for varying and equalising the rates of profit as returns from US investments in China or Mexico. As Bukharin observed: "By and large, the whole process … reduces itself to … widening reproduction of the relations between two classes—the class of the world proletariat on the one hand and the world bourgeoisie on the other."2

This claim was truest in terms of the proletariat as a class-in-itself because colonisers were depriving their subjects of their means of subsistence. More of them, therefore, had to sell their labour-power. Bukharin accepted that the international division of labour was based, not just on the "production of different use-values", but on different production costs, which were "reduced, through international exchange, to socially indispensable labour on a world scale". That equalisation of wage-scales and of normal minimums for capital allowed for an equalising of profit rates.

The closest that Lenin came to discussing labour-power in his Imperialism was when considering the aristocracy of labour. He argued that this privileged sector of workers had become possible only because of an aristocracy of capital, that is, a stratum of firms which could achieve higher than average rates of profit, whether by monopolising, swindles or plunder. These super-profits could arise between sectors or firms within a nation-market-state, as often as derived from colonies.3

Globalisation "Mark V" comes with inverted commas because the question marks hanging over the recent past are the subject of this essay. One hope of world capital has been to install, for every commodity, labour-times that will apply across the globe. The flexible accumulation that some commentators take as the crux of "Mark V" has to be flexible in its application—here more rigid and there more malleable. To eliminate variations in quality, Intel has just adopted a factory design of "copy exactly", down to the colour of the workers' gloves. Standardisation is more essential than ever with nano-measurements.

The fantasy that everyone could work from home, indeed from anywhere across the planet, has been abandoned. The limitations of on-line exchanges have been acknowledged and the necessity for face-to-face encounters in many situations accepted. Business researchers report that the internet is likely both to increase agglomeration and not to "reduce the importance of locational clusters".

Meanwhile, a new kind of reserve army of skilled labour exists in the Third World. US firms import computer specialists from India after the expense of producing their expertise has been met. In an unequal exchange, it corporations began by exporting routine tasks to India. The operation of call centres from the subcontinent has been followed by the dispatch of digitalised ct-scans for diagnosis.

If globalisation "Mark V" has been more than a catch-word, the substantial changes began from a restructuring of production-capital, notably the world car in the 1970s. Tariffs had secured monopoly profits for vehicle-makers. When those corporations faced competition from Japan, and then retooling costs to deal with oil price rises, the automobile oligopolies negotiated new protective arrangements. Manufacturing regimes in which different countries performed only some of the steps in the production stage went beyond autos and on to computers. More of the growth in world trade since 1945 has been attributed to this vertical specialisation than to tariff cuts. More than half of the exports from mainland China had been "snapped together" from parts imported from Japan or Taiwan.4

Globally integrated production encouraged financial deregulation to facilitate the transfer of investment funds and a reflux of profits. Despite the association of globalisation "Mark V" with intangibles such as banking and "infotainment", its seedbed was in meeting the needs of rust-bucket industries. These relocations of production saw US multinational enterprises repatriate less in profits than they imported as commodities. The consequent balance-of-payments crises led to floating exchange rates.

Whatever the truth about a fifth phase of globalisation, the recent expansion of capital has carried forward its monopolising competitiveness. Indeed, oligopolisation has become ever more extensive and intensive for automobiles, communications, finances, oil and pharmaceuticals. Coca-Cola consolidated its Latin American bottlers late in 2002, in reaction to a similar consolidation by the Pepsi Bottling Group. That mimicry is another instance of how competition contributes to monopolising. Mergers among oligopolies have been a feature of recent years because businesses must either consolidate or disappear. According to the Harvard Business Review, managers need to perfect their acquisition skills because "merger competence is paramount". Meanwhile, resource corporations are forming on-line purchasing pools to reap the benefits of monopsony. Wal-Mart can achieve that result on its own account. Its insistence on lower prices year after year drives its suppliers bankrupt, or offshore.

The substantive dynamics in each phase of globalisation have to be distinguished from their technologies. The internet is no more globalisation "Mark V" than the telegraph was Lenin's imperialism. In that first round of monopolising competition, the railroads and electricity speeded up the three circuits of capital. Railroads allowed the movement of larger volumes of commodities at faster rates over longer distances inland than had wagons or barges; financing railroad construction contributed to the centralisation of banking; building the rolling stock and the tracks encouraged consolidation in theUS steel industry. Electricity delivered an equal variety of opportunities: transmission lines permitted production at a distance from the generation of power; electric light completed the erasure of distinctions between day and night work. Comparable complexities flowed from the internal combustion engine and petrochemicals. All four technologies became highly oligopolised and permitted a massive expansion of values. Today, the paucity of new realms for productive-capital is one reason for doubting the distinctiveness of Mark V. The $100 billion in "good will" that spewed out as a bookkeeping fraud by aol is a long way from the wealth once generated at General Motors, aeg, ici or Mitsubishi.

Information technology is never neutral in this monopolising. For instance, Microsoft engineers write code that "will tilt the playing field in their direction".5 Nor did the collapse of the dot-coms level that field. On the contrary, such contractions trigger fresh bouts of centralisation.

The need to lift productivity has required ever more investment in the most advanced machines. That approach for extracting a greater surplus is never isolated from an intensification of the employees' effort. A German textile worker described their interplay in 1903: "Whereas a loom used to give forty-five shots per minute, the new looms have raised this to 105 shots per minute and now three hundred thousand shots are demanded each week from a worker on a new loom".6 Indeed, the more complex the machine, the more vital it becomes for the remaining operators to stay awake. Alertness is often the prime skill. Paradoxically, the simpler the new devices are to operate, the closer its functionary's "attention is forced to be".7 Intensification comes from both directions.

All technologies alter work procedures. Hard technologies, that is, new machinery, will be accompanied by soft technologies—a reorganisation of work practices. Capital seeks to reduce the times taken to implement job redesign from months down to weeks in order to pay for investment in equipment. Hence, managers enforce employee participation, whether with tqm prayer meetings or human relations therapy sessions.

From the 1970s, the adoption of computer-aided design and computer-aided manufacture (cad-cam) reshaped not only the labour-process but also marketing, a shift which soon fed back into the structures of production. The initial advantage to capital from cad-cam was a reduction in down time because lathes and their highly paid operators did not have to be idled for so long in order for the machines to be reset. A contested benefit was the deskilling of certain operations, which made it easier to replace skilled militants at lower rates of pay.

The new machines renovated marketing because they also made shorter production runs profitable. Hence, the range of models on offer could be increased. That possibility has installed a built-to-order nexus between the sales effort and manufacturing. Dell's customised computers provide the best-known case. Here, the advantage has been to cut the costs of having capital tied up in products as well as supplies. Just-in-time now applies to both ends of the chain. This expanding international trade in semi-finished goods (vertical specialisation) has combined with new production technologies to dislodge certain higher-paid skilled workers.

The cost-cutting depended on a reorganisation of transport. Freight companies have rebranded themselves so that trucks promote "Mayne Logistics". Geo-positioning satellites allow the firms to track each order around the globe, much as punch cards did for cartons inside warehouses fifty years ago. Faster and more reliable deliveries are not enough. The services delivered by logistics firms are rewriting the production script. What began as a twist to outsourcing will reshape manufacturing, giving greater salience to continuous flow inside factories. The costs of down time fall more on part-time casuals rather than capital.

No managerial innovation for the application of labour times since the 1970s has had as much impact as did continuous flow, or the micro-time controls introduced during Mark IV. Instead, the era of the most advanced technologies has been accompanied by pushing up the rate of exploitation through the crudest devices of exacting unpaid labour time throughout the service sector, and by intensification everywhere. The success of these measures was possible because of the disorganisation of the working class, shadowed by fears of dismissal, now rampant in the airline industry.

Labour times

Capital itself is the moving contradiction, in that it presses to reduce labour time to a minimum, while it posits labour time, on the other side, as sole measure and source of wealth, as Marx put it in the Grundrisse. Although our perceptions of time's passing are affected by the micro-management of the working day, subjective responses—tedium or delirium—cannot alter the nature of cosmological time. Nor can time be produced, have value added to it, or be sold. At most, a firm can manufacture and market devices to tell us the time of day. Hence, to lament the commodification of time is nonsense, even from the pen of E.P. Thompson.8 Commodification is the preserve of labour times.

At issue, therefore, is how firms apply the working time they buy from their employees. Labour itself cannot be bought. All that can be bought is a worker's capacity to add value. Having hired that labour-power, bosses still have to apply it to raw materials, semi-finished goods, or services. In short, the firm has to keep its workers at it. Max Weber opened his 1904 account of the Protestant ethic, not with the spirit of the capitalists, but by arguing that their success depended on their workers performing each task as if it were an absolute end in itself, a calling. But such an attitude is by no means a product of nature. It cannot be evoked by low wages or high ones alone, but can only be the product of a long and arduous process of education.9

"Once in the saddle" (to use Weber's phrase), the managers can seek more value by demanding longer hours for no more pay, or by enforcing a faster output within the existing working day, notably by mechanisation. These drives will operate whether we assume that the employees' contribution to values is 100 per cent, or only some portion thereof.

Labour time takes two forms—concrete and universal—and assumes a third—abstract. Concrete labour time is the interval that a worker takes to complete a task, and so varies with each operator: "The amount of labour-time contained in a commodity, and therefore its exchange value, is consequently a variable quantity, rising or falling in inverse proportion to the rise or fall of the productivity of labour".10 Hence, the duty of every overseer is to drive all concrete labour times towards the most efficient labour time then prevailing in a given market. This interval is known as universal labour time (ult). ults are, therefore, a smaller multitude of actual lengths of time than concrete labour times. While there was a clt for each person, there is a ult in each market for the worker's product. These "universals" are mobile measures which capitalists must pursue if their firms are to survive, "not a ready-made prerequisite, but an emerging result".11 Universal labour time is at once a standard and a compulsion to exceed that standard: universalised and universalising. A related task for managers is to speed up the ults in order to beat the times achieved by competitors. As a result, capitalism is a perpetual acceleration machine. To rephrase Marx, utopia for capitalists is labour without labour time.

Until the twentieth century, a firm's achievement of the prevailing ult could be confirmed only after profits had been reported. Even that index was rough and ready because bookkeeping remained rudimentary. Moreover, the realisation of any portion of the surplus depended on the employer's ability to sell his workers' output. That profit result is only indirectly proportionate to labour time. Taylorism sought to move beyond this post hoc calculation of the success at matching—and besting—the labour times of the competition.

Concrete labour times have no conceptual equivalent for as long as they are confined to the production of use-values. Because "abstract labour … is the source of exchange value" for the system as a whole, it cannot adhere to a specific use-value.12 The pursuit of universal labour times arises only with exchange-values. The principal one is the sale of labour-power, not just the barter or trade of its products as in feudalism.

Abstract labour time involves a different level of analysis than is applied to the chase after universal labour times. Universal and abstract labour times remain distinguishable. The former are social practices whereas the latter is the equivalent that enables money, by acting "as reification of labour-time", to provide both the measure and the medium for a fluent exchange of all other commodities.13

The price of labour is tied to the costs of its reproduction on an hourly and generational basis. Those costs rise and fall with the bargaining power of the workers, as is shown when they organise to reduce hours, improve conditions and safety, lift real wages and pressure governments for a larger share of tax-funded spending. The conflict between that range of demands and the profit-chasing by their employers is therefore multilayered. In Nike's case, a 1995 breakdown of the costs of producing and delivering a pair of shoes to a retailer showed that production labour amounted to only $2.75 of $29.00 outgoings before profit.14 Thus, holding down wages becomes only one aspect of how corporations secure the maximum from the labour-power they buy. Starvation wages are of little help if the product is too shoddy to sell, the warehouse is burned down during a strike or the value of the local currency see-saws.

Managers want to set all the factory rules to suit their production schedules. Hence, they may concede higher wages in exchange for stricter time controls. Such pay increases are recouped by shifting other costs—for example, of down time—to their workers through casualisation. The race is not a sprint to the bottom where the prize is the lowest wage, but a triathlon for reducing all the costs of production per unit, predominantly through the direction of labour time.

Of course, firms prefer both time controls and wage cuts. Chrysler's plan for a new factory at Windsor, Ontario, will slash its capital outlays and trim labour. Suppliers will be required to invest sixty percent of the construction costs and transfer theirlower wage rates into the auto maker. The Canadian Autoworkers Union bowed to the deal following the loss of 15,000 jobs since 1999. That capitulation confirms that wages are determined within the relative strengths of the contending classes.

The animal spirits that stalk the stock exchange rarely distract the calculators of labour time. Mass sackings are one form of its control. Hence, the 1990s exuberance has meant, as Business Week spelled out,

far more pain for workers … To get [corporate] earnings up—without accounting tricks—executives are going to have to make deep cuts in payrolls and productive capacity … The road to higher profits will be a painful one. To meet their profit targets, companies will cut costs again and again, shuttering factories and offices and shedding unprofitable lines of business.

Business Week estimated that "in order to boost operating profits by 12% during the next year, companies in the s&p 500 may have to cut some 900,000 jobs, or 4% of their workforce".15 The total for the whole economy was twice as great, with 300,000 shed in February 2003 alone. Those dismissals came on top of the half million from the it/telco sector during 2001 and 2002. Chief information officers switched from spreading knowledge through their corporations to cutting budgets. In August 2003, manufacturing employment fell for the thirty-seventh consecutive month. That drop was part of a 93,000 decline for all non-farm levels for the month, the biggest since March. Robust growth of five per cent in gross domestic product came at the expense of jobs. The seeming paradox of jobless growth resulted from "the ability of businesses to squeeze more output from their existing workers" as productivity grew at an annual rate of 6.8 per cent.16 This spurt continues a long-term trend in manufacturing in the G7 economies. Between 1970 and 2003, output more than doubled while employment dropped by a quarter.17 What has been called de-industrialisation has in truth been de-labourisation. Hence, postwar affluence is best understood as a "trough in unemployment", not as the norm to which capitalism is about to return.18

The background to this latest assault on jobs and incomes was a spurt in real wages during the final phase of the 1990s boom. Earlier and actual increases in profitability had followed the driving down of labour costs throughout the 1980s. Many of those savings had come by slashing staff levels in the advanced economies, glamorised as flexibility. Some firms started up in locations with few inhibitions about the ill-treatment of workers. Both tactics were part of the centuries-long trimming of unit labour costs.

The pressure on labour costs has also driven the restructuring, usually a contraction, of the state service sector. That feature of the recent past is so ubiquitous that many people equate it with globalisation Mark V. Almost by definition, services, whether state or corporate, will be more labour intensive than manufacturing, mining or agriculture because mechanisation can more readily improve productivity in those sectors. By contrast, the quality of care is harder to sever from the labour time spent by professionals. In addition, advances in treatment can add to the hours required per patient. Heart surgery increased the call on intensive-care wards, partly met by early discharges. In the case of "attention and affection", neo-liberals face the problem of commodifying demands which, fortunately for humanity, "have no close market substitutes".19

In the corporate sector, the shift from rural and manufacturing towards services provided jobs but also added to the burdens from unproductive capital, notably from marketing. One solution has been to reduce administrative overheads by electronic transfers; another is to make customers and clients wait. The budget airline, Ryanair, cut its administrative "costs by 62 percent by selling more than 90 percent of its tickets online".20 The World Wide Web has allowed the export of accounting to lower-wage economies which also host call centres.

Until the early 1970s, the mounting cost of these provisions in the state sector was met by expanding tax revenues. Avoidance and evasion by corporations and by the self-employed put paid to that solution, exacerbating a fiscal crisis of the state. Despite the adoption of administrative and delivery systems to shift costs from the service providers, the pressure continues to hack into state-provided services on the grounds that all government spending bolsters interest rates, thereby making corporate debt less competitive in a worldwide money market. These attacks on the welfare system to appease the financial markets show how the expansion of capital binds together seemingly discrete experiences, in this case linking labour times to money-capital.


Hence, it is only in the markets of the world that money acquires to the full extent the character of the commodity whose bodily form is also the immediate social incarnation of human labour in the abstract. Its real mode of existence in this sphere adequately corresponds to its ideal concept.

Money provides the universal equivalent for the labour time embodied in the commodities that emerge from capital's production stage. Money-capital expands through this metamorphosing because, although money is "a physical object with distinct properties", it "represents a social relation of production".21 That relationship is between labour-power and capital, although the power of the latter has to be buttressed by the state. Unless a state can also enforce a symbolic currency, the medium for the equivalent of the universal labour time embodied in commodities must remain another commodity. Gold as a universal commodity has certain advantages over rum at Botany Bay, or umbrellas in Tokugawa Japan.

The dematerialisation of money has advanced far beyond 1867 when, "for the sake of simplicity", Marx could explicate money in terms of gold. The world economy is now six times larger than in the 1930s. To match this multiplication, money circulates with ever greater velocity. This pace puts ever greater distances between money as a medium of exchange and its material form as gold. When the world economy wobbles, as it has recently, the gold price increases as it becomes attractive as a currency of flight. Nonetheless, such hoards are now built up through bookkeeping entries more often than as physical transfers of the "barbarous relic".22 Globalisation will have become as absolute as promoters of Mark V have been wont to claim only if money is freed from its commodity form. Until then, gold will hover backstage because no nation-market-state will be strong enough to impose its "imaginary money", "tokens", on world markets.

Despite this gap in the newest order of the world, the might of the US economy has kept its dollar as the lodestar for navigating storms in the flows of commodities and finance. Because commodities move money more than money moves commodities, the changing status of the US dollar's role as "world money" has registered movements in its military might and trading power. By 1945, no rival came within a country mile of US power—military, financial or industrial. During the first world war, the masters of the nineteenth-century universe in the City of London lost ground to Wall Street. In 1944, Keynes lost the second battle for Britain when, at Bretton Woods, he bowed to the installation of the imf as an instrument of the US Treasury. Since then, "[t]he advantages from controlling the world economy's currency reserve", known as seigniorage, have accrued to the United States because its trading partners have needed to hoard its dollars.23 Most Japanese foreign trade and overseas investments are in US dollars, as are almost all oil purchases.

Although Washington ensured markets for US products via the 1948 Marshall Plan, the US started running trade deficits from the late 1950s. This threat to the convertibility of the dollar accompanied the decline of Britain and a resurrection of Germany and Japan. The Japanese would transform their economy from Third World status in 1950 to one of the pillars of trilateralism by 1975. The postwar financial settlement fractured as commodity trade returned to a multi-polar pattern. Britain devalued again in 1967 while Japan maintained an artificially low exchange rate to underpin its exports. A bout of trade wars proved as potent as the Kennedy Round of the gatt. In the late 1960s, the US attempted to finance its shooting war against the Indochinese by flooding the world with devalued dollars. Rebellion against that imposition led to the collapse of Bretton Woods in 1971. opec sought to retrieve the real rate of return by driving up the number of devalued dollars per barrel. From late 1973, the tide of petrodollars, and then Britain's resort to the imf in 1977, encouraged governments to relax their exchange rates. That strand in financial deregulation exploded with globalisation Mark V.

The Plaza Accord of September 1985 drove down the US dollar in order to revive its economy. The result was "Black Monday", October 19, 1987, when the New York Stock Exchange plummeted after Japanese investors dumped assets denominated in the declining dollar. In Tokyo, the Ministry of Finance then instructed Japan's financial titans to buy US securities to underwrite the world economy. The "reverse Plaza" of 1995 pushed up the US dollar to help out Japan and Germany. The recent devaluation of the US dollar risks repeating the October 1987 crash at a time when Japan Inc. is incapable of rescuing itself, let alone the rest of the capitalist system.

International aspects of finance have always been tied to the expanded reproduction of capital in a single market. Extended credit had been vital from the start of capital's expansion in the fifteenth century, when turnover times were so long. A primitive trade in futures (the commercial face of merchant's capital) quickened accumulation by reducing the number and duration of interruptions to the circuits of capital. In the 1970s, the need to service the turnovers of capital combined with the disappearance of a global standard to help money-dealers jostle aside the old futures traders for the prime positions in the finance sector. Derivatives spun out of futures trading, continuing a little of its impetus to the acceleration of turnover times but allowing ever more space for swindles. Mechanisms for acceleration have multiplied the opportunities for capitalists to rob each other, which is a less expensive undertaking than making their workers go harder and faster. As Marx observed: "All nations with a capitalist mode of production are therefore seized periodically by a feverish attempt to make money without the intervention of the process of production".24

Whenever the output of corporate mines, farms and factories exceeds the demand from those who can afford to buy, the result must be fewer opportunities to invest in the expansion of capital. Hence, the most innovative domain after the 1970s became the financial sector. Financial goliaths such as Citigroup became gigantic by bending the law to ride the waves of funds far in excess of the investments needed for productive capacity.

By the 1990s, the paucity of profitable stocks in the old economy spurred a stampede into telecommunications, the base for high-tech start-ups. That rush, in turn, carried excess capacity into the New Economy. Only 2.5 percent of the sixty-five million kilometres of fibre-optic cables criss-crossing the US was in use.25 The toppling of the telcos and the its has left fund managers with even fewer places to invest. Outside mainland China, excess capacity in production-capitals neared one-third. The oversupply is so great in US armaments that a fifty per cent spending boost will add only 0.6 percent to gross national product.

The dealers also fed off business debts in the US, which rose from $2000 billion in 1984 to $7200 billion by 1994 before shooting past $17,700 billion for 2001. Since then, they stabilised as another sign of recession. Most of the later tranche of debts was incurred for mergers and acquisitions, which is the growth that performance-paid executives pursue when they can't achieve growth. Not onlymust these debts be serviced at compound rates of interest, but a bout of deflation would increase the effective outstanding principals.

One late investment opportunity appeared to be electricity production. As a result of a torrent of funds, the sector expected excess capacity to last till 2006. If the projected expansions were to proceed, there would be fifty-six per cent overcapacity in the eleven western US states. Duke Power cut its forward prices from $51 per megawatt hour in 2003 to $39 for 2005. Calpine Corp. cancelled $3.4 billion in its construction spending for 2003-05.26 All gluts have multiple depressing effects, first on profits through lower prices but also indirectly on suppliers by slashing orders for equipment.

Institutional investors swerved away from making profits from production and towards the arranging of financial deals. Their endeavours were facilitated by the invention in the 1970s of discount brokerage, indexed funds, cash-management accounts, junk bonds and spreadsheets. These instruments marshalled the retirement savings of employees. The amounts required for a secure old age grew with longevity, the interval between retirement and death, and the socially necessary costs of dying. After the 1960s, the fiscal crisis of the state had led governments and employers to encourage workers to contribute to superannuation schemes. The vastness of these savings added to the turbulence at a time of excess capacity. Instead of planting them in government bonds or gilt-edged securities, the fund managers chased the highest nominal rates of return. In turn, the companies getting those investments reported quarterly returns to impress the funds managers by slashing staff, R&D, inventory and auditing standards.

These deferred wages and salaries were invested in their employers' businesses. Workers were soon advancing money-capital as well as labour-power to their bosses. For instance, at the Coca-Cola Company, four-fifths of the 401(k) retirement assets of employees were invested in company stock, the value of which slumped by thirty per cent in the three years to late 2001 and a further twenty per cent during 2002. The ceo who presided over the start of that slide exited with $17 million on top of his stock options, which had already siphoned value out of his employees' assets. The US government agency insuring these benefits has been run into the red. Since 2000, Japanese corporate and government funds have sunk into negative territory, causing firms to renege on their commitments. That default is repeated in Europe and the US. Between 1998 and 2002, US pension funds went from a surplus of $257 billion into a deficit of $243 billion.27 The Pension Benefits Guaranty Corp. went from a $7.7 billion surplus to a $3.6 billion deficit during 2002.28 The creator of low-cost share trading, Charles Schwab, has reneged on pension promises to his own staff.29

This depletion of retirement provisions represents a transfer from the workers' earnings on top of the expropriation of their surplus value at the point of production. The German middle class was bankrupted in 1923 by inflation that stripped the purchasing power from their bank deposits and government bonds. Today, working people are in danger of a similar fate, this time from a deflation of their savings held in shares.

Where have all the losses gone? Some went nowhere because they never were more than paper. Investors who got in early had only nominal fortunes when the number of their shares was multiplied by the price of the latest trade. To see where the actual losses went, we need to distinguish "lost" from "transferred". None of the actual losses are missing in the sense that Lasseter's Gold Reef can no longer be located. Many have been transferred to whoever was smart enough to get out early, to vote themselves share options or otherwise strip assets. A third loss is actual when, to fund takeovers, sectors of the target company are cast aside. Its book value is then worthless. On top of the paper losses, the semi-legal transfers and the frauds, much physical stock, not to mention intangibles such as goodwill, has been stripped of its use-value. Warren Buffett, the renowned US investor, is dead right to stress that the worth of a stock is not how much money has already gone into a firm, but how much dividend can still be taken out.

Buffett is portrayed as the good capitalist whose personal style is modest and who invests for long-term growth, not speculative plunder. These attributes are compared favourably with the excesses of Dennis Kozlowski at Tyco, who bought $6000 shower curtains, or with the havoc that George Soros wreaks on entire economies by betting against their exchange rates. Yet, from the standpoint of the expansion of capital, Buffett's behaviour is more exploitative than any speculator's. The surplus that he re-invests, rather than lavishes on himself, extracts ever more value from workers at the firms into which he has put his clients' money. The morality of capitalism is to be judged by its logic of expansion, not the fables of its folklorists.

Apologists for capitalism cannot make up their minds whether the recent round of corporate crimes results from a few bad apples, or should be sheeted home to all of human nature, genetically determined. In practice, greed is stimulated by the expansion of capital far more than the other way around. If avarice were all there was to the multiplying of wealth, capital would rarely have grown. Instead, the surplus would be either hoarded or squandered on commodities that did not extend its reproduction.


Commodity-capital appears in four forms: precious metals as money, labour-power, production goods and consumption goods. Several Marxian analysts (e.g., Baran and Sweezy) have suggested that mass personal consumption now constitutes a fourth circuit of capital. Without underrating the importance of post-1950 consumer spending for the turnover of capital, the inscription of a fourth circuit seems superfluous, indeed little more than metaphorical.

Although money itself need not be a commodity, money must maintain a position in the exchange between commodities. A commodity has not fulfilled its function as a commodity until its buyer's money is in the hands of the seller. Profits must be realised through all the three circuits of capital, that is, from money going into the production-stage and thence as commodities into the marketplace. Only by selling those products at a price above the costs of their production and distribution, and then getting as large a share as possible of those earnings back to the firm's bank account, is it possible for capitalists to maximise the profits out of which to fund their next round of expansion.

That growth of production requires ever more consumption. The importance of sales potential was shown by a 1997 survey that asked managers to rank thirteen criteria for deciding whether to invest overseas. The size of the foreign market and a need to exclude rivals were towards the top of that list. Quality of labour came fifth, with labour costs down in ninth position.30 Inadequate transport or poor communications disrupt these priorities. Mobile phones leapt over the poor landline system in Thailand, but getting a crate from a Bangkok factory to its airport can still be a trial—a job for "Mayne Logistics".

The primary commodity needed for capital expansion is labour-power, which becomes useful only when alienated in the double sense of sold and estranged. On being purchased, labour-power is transformed into commodity-capital. Its new owners will lavish every attention on their possession throughout the production stage to ensure that labour time is applied as efficiently as possible.

One approach to understanding why the control of labour times is central to capital's expansion is to ask why excessive hours have returned as a problem for so many workers. In the mid-1950s, the panic had been that automation would re-instate mass unemployment. By the 1970s, the concern was that there would be a social crisis as people failed to cope with an avalanche of leisure. One commentator proposed in 1974 that "if everyone did a short stint of factory work each year, it would be possible for everyone to be free from such work for most of the year".31 The reverse has happened because no firm or national economy could survive against its monopolising competitors if it gave up so large a share of the values added in labour time. Everywhere and always, the expansion of capital is necessitated because of the conflicts between labour and capital on the one hand, and among rival capitals on the other.

Employees are now more reluctant to accept a shorter working week if that reform reduces or constrains their earnings. They must maintain that income to match the ever increasing costs of reproducing their labour-power. Capitals induce those mounting expenses in order to absorb the overproduction that results from competitiveness. Demand levels are set by the relations of production, not within the domain of consumption. The pattern of consumption is a consequence of the ratio of wages to profits. Expansion is suspended, and the system approaches crisis, if the commodities do not encounter a user who can also afford to buy. In that case, money-capital is fallow.

The expansion of capitals has provided enough material wealth for everyone to live in more than frugal comfort, yet that abundance cannot be distributed because the proletarianisation of the populace precludes their having the effective demand required to consume the surplus. The irrationality of capitalism is manifest in the contradiction between its socio-technical capacity to grant much reduced hours and the socioeconomic impossibility of its doing so.

One of the ways in which money-capital speeds the turnover is by credit. Just as free labour can, without paradox or oxymoron, be called wage slavery, so consumer sovereignty can be rebranded as credit-card peonage. A peon has to return to work each season to pay off debts to the company store, whereas free labourers are bound to the entire mass market by the loans, advances and mortgages necessary to meet the capital-induced socially necessary costs of reproducing their labour power. In 1970, an Australian household could have paid all its debts with the earnings from twenty-two weeks' work. Today, that clearance would take a year's income. In the US, the unemployed borrow against their retirement funds. So many of the better off remortgaged their homes to pay off their credit cards to avoid higher interest charges that personal debt levels fell for the first time in decades. The business press now worries about "redundant consumers".

The growth of household debt carries us back to the core of this analysis. As living costs increase, so must real wages. But because of competition, capitalists must reduce labour costs per unit. The cheapest way to achieve that result is through an acceleration of universal labour times; notwithstanding that cheaper approach, intensification is often achievable only when allied to the expense of new machines, which have a rate of obsolescence approaching that of the consumer goods they churn out.

Completion of the proletarianisation of the work force in the advanced economies meant that almost all of the resources needed to reproduce labour-power were wage goods, which put upward pressures on the price of labour. There was nothing outside the market—as Derrida should have said. Furthermore, production of those goods had been taken over by capital-intensive corporations that had to reduce their unit costs by inducing more needs in the work force, thereby adding to the socially necessary costs of labour-power. Because of the postwar social compact and the industrial strength of the unions, wage levels could not be reduced or labour times increased. Until Reagan and Thatcher, the trade-off between wages and unemployment had been lost. The open slather associated with globalisation Mark V was essential to hack into the high wages to sustain the high sales on which the postwar boom had been constructed.

Commodity-capital is more than it seems to a suburban shopper armed with a Visa card. The bulk of commodities such as steel, petrochemicals and grains are traded in bulk and often outside the market. One-third of US exports and half of its imports take place inside multinational corporations.32 Raw materials, semi-finished goods, final products and labour-power are all outputs from one industrial cycle and the commodities for the next. Other bulk items, such as electricity, are auxiliary to the production stage.


"Production is thus as the same time consumption, and consumption is at the same time production."—Karl Marx, A Contribution to the Critique of Political Economy, 1857.

A failure to distinguish the three circuits of capital's expansion permits the chatter about the mobility of an unspecified capital being the crux of globalisation Mark V. Money-capital can now go at near the speed of light along a fibre-optic cable, and some commodity-capital close to the speed of sound in a cargo jet. Meanwhile, production-capital shifts at walking pace. The costs of uprooting equipment from one site to another remain prohibitive. When plant is moved, it is most often commodity-capital on its way to being installed for its purchaser. A sign that Mark V may possess some substance is that equipment is moving as much as it does. Even so, very few firms have transferred existing buildings and machines from one nation-market-state to another. Mostly, businesses start up in green fields. The idea that functioning production-capitals can slip across borders like a backpacker is believable only if you have never run anything bigger than a photocopier.

Nike, for instance, does not move any production-capital between countries. The burdens of relocation have been carried by its suppliers, who must recoup them from their work force, or by swindling other business partners and governments. Nike appears "weightless" by externalising the cost of relocation. Even contracting to a new supply house is never easy, as Nike found when it tried to work with state enterprises in mainland China. Nike can switch its orders around between competing producers once they are up and running. Even then, delays and disruptions will arise from forging new chains of supply, thereby incurring expenses for both Nike and its contractors.

The worth of Nike's suppliers remains sunk in their physical properties. For a firm to abandon those facilities before they have passed their use-by dates would be to risk bankruptcy or crippling debts. Once machinery is installed in Bangkok, the costs of moving it lock, stock and barrel to Hanoi could have the same result. A supplier, however, could follow Nike's example and hire the machines as well as renting a factory. The costs of moving would then be passed down the line to the machine-makers. Either way, the expense of equipment has to be borne. Recently, that has been reduced by designing machinery and buildings that can be assembled with a minimum of labour time. These relocation costs spur firms to seek relief from government regulations and imposts and to demand tax-funded subsidies. The significance of the production stage in the expansion of capitals is never confined to their current owners and controllers. Access to the resources to meet one's needs is at the root of the social relationship that is capitalism. This class division of labour is determined by the want of productive property, which is why the vast majority of us must offer to sell our labour-power. In terms of the ownership of productive property, all workers are always the working poor.

That deprivation is also the ground on which to decide whether the poor have become poorer, or more numerous, during globalisation Mark V. The expropriation of communal or familial resources has been more significant than any income shifts. That loss of productive property is absolute, not relative, and almost always final. A recent survey across the past 500 years argues that the imposition of imperial institutions and the destruction of indigenous ones reversed the relative wealth of areas colonised by Europe. Australia, for instance, moved upwards while Peru went down the scale.33 Erstwhile landowners are reduced to potential wage labourers—swelling a reserve army of the underemployed. In addition, separation from the capacity to grow or gather one's own food leaves the landless more dependent on store goods, which are more expensive and less nutritious. The costs of reproducing labour-power thereby increase, while health deteriorates. The loss of productive resources also disrupts family-based welfare whereby the aged could be sustained by their children. Without traditional production resources, the family becomes subject more to the vagaries of commodity, money and labour markets than the weather. This proletarianisation on a global scale was necessary to marshal a new reserve army.

Wages are a limited measure for shifts in inequality, though the easiest to compute. Moreover, wages are only part of income. Total earnings involve tax transfers and access to health and education. Monetarising that mix in the standard of living is not the same as evaluating the quality of life. These limits have to be remembered when judging contrary claims about patterns of equity. A long-run study of incomes indicates that inequalities within countries widened from the 1820s until the second world war, since when the widening spread has been between countries.34 A survey of incomes alone for only the past thirty years concluded that "global inequality increased slightly during the 1970s, declined during the 1980s and went back up during the 1990s" while "within-country inequality has increased monotonically".35 Investigation of twentieth-century incomes in the US shows that the "working rich" have overtaken rentiers, and that the top wage shares are now higher than before World War ii.36 The decline of inequalities in twentieth-century France has been identified as a "capital income phenomenon".37

Attributing a greater spread of earnings in the first world to globalisation Mark V may rest on a mistaken belief that full employment and welfare spending had improved social equity through the immediate postwar years. As early as 1963, Richard Titmuss concluded that the British welfare state "had not led to any significant redistribution of income and wealth in favour of the poorer classes". On the contrary, social democrats had "gravely under-estimated the growing strength of the forces working in the other direction".38 If the apologists for freer trade and deregulation are right to claim that first world inequalities of income have not worsened recently, perhaps the reason is that circumstances had remained worse than a previous conventional wisdom had allowed.

Irrespective of the accuracy of any of these estimates, changing levels of poverty or inequality cannot be discerned from comparative earnings alone. More potently, people in subsistence economies are being stripped of their access to soil and waters. Dams, factory ships and pollution from mines are three of the indirect means by which proletarianisation is being accelerated. These assaults are conducted by the police and the army, not by executives from the corporations that will take over the forests or other resources. In Colombia, the thefts are perpetrated under the guise of poisoning coca crops. In Bolivia, the police killed peasants protesting the takeover of municipal water by Vivendi. The oil majors and Bechtel followed the marines into Iraq. They could not have financed, let alone executed, the takeover out of their own resources.

The arms trade is pivotal in this impoverishment. Dictatorships sell bulk natural resources at or below the costs of production to generate revenues to purchase weapons to maintain their dominance. This unequal exchange enriches first world arms manufacturers and pleases the Pentagon because these weapons of destruction suppress resistance to exploitation, a defence of property rights denigrated as terrorism. The definition of the nation-market-state as attempting "for capital what its managers cannot achieve through corporations" continues to be written in blood. The chill hour of the last instance does arrive, not at the economic level, but at the political, where class struggles are decided.

The nation-market-state

Ellen Meiskins Wood explains the endurance of the nation-market-state in terms of the uniqueness of how the surplus is expropriated under capitalism. In "other systems of exploitation classes or states extract surplus labour from producers by direct coercion".39 By contrast, the capitalist relies first on the propertilessness of others to oblige them to sell him their labour-power. Their lack of resources is the outcome of earlier interventions by the state to separate them from the means of reproducing their lives. The capitalists then use all manner of controls inside workplaces to extract advantage from the labour-power they have purchased. A few of these tactics look back to feudal arrangements, with private militias or model townships. Either way, force is integral to the class divisions of capitalism. Yet the state as an instrument of class rule is not the same as the nation-market-state, which is peculiar to capitalism. Because capital expands by separating the moment of appropriation from the moment of realisation, a space exists between the economic and the political. The more globalised the circuits of capital become, the wider is that gap, and the more capital's expansion must rely on state apparatuses to close the breach. Commentators on the impact of globalisation on the nation-market-state render themselves irrelevant by denying its basis in class conflict. The nation-market-state has the twin tasks of maintaining a regime for the expropriation of the surplus at home and aiding its realisation everywhere. Success at the former is decided by the relative strengths of the contending classes. Achievements in the latter follow from that domestic contest but encounter opposition from other states, especially the imperial ones. The latter took shape when the Dutch traders were defining the law of the sea with the range of their cannon, the results of which Grotius then legitimated, forty years before the Treaties of Westphalia attempted the same for land borders.

These rivalries are now concentrated between the three economies—the US, Europe and Japan—on which the latest round of expansion was built. The impasse at the wto over agriculture and intellectual property is matched by the division in the United Nations Security Council over Iraq. Compliance with the dollar hegemon has never been total, as is apparent again with the creation of the euro and Tokyo's concurrent attempts to install a yen bloc in east Asia. Meanwhile, Iran and Iraq were selling oil for petro-euros. These measures show how far globalising capitals are from forming a mega-corporation and hyper-state that can dominate the planet. A displacement of the dollar as the global fiat currency would be one effect of the demise of Washington's political dominance, not its cause.

As the circuits of capital expansion became wider, risks grew, and their management encountered ever more diseconomies. The organisational structures of the corporations most identified with the globalised New Economy vary from the highly focused Intel and Microsoft, through the vertically dis-integrated Toyota and Dell, the conglomerates of General Electric and Virgin, and the old-style multi-divisional transnationals of ibm and bp Amoco. This array points up "the enormous uncertainty that business people face in deciding which coordination mechanisms would be best to employ … and the ongoing uncertainty they face about the direction of change".40

In an effort to compensate for the absence of a global-market-state, several organisations have attempted to facilitate the extension of each of the forms assumed by capital: money-capital through the imf and World Bank; commodity-capital through the gatt and the wto; and production-capital in multinational corporations. These bodies also concern themselves with labour costs. The imf and World Bank attach codes of labour flexibility to the granting of loans to governments. The rules of those bodies are enforced—and resisted—by nation-market-states. Criss-crossing these alliances and disputes have been efforts to integrate the three circuits and smooth the rival claims. As the postwar settlement fell apart, David Rockefeller initiated the Trilateral Commission in 1973. The World Economic Forum (first meeting at Davos in 1970) provided a sorting house for a select group of Europe's ceos until it became another gab-fest.

The expanded reproduction of capital continues the reordering of power among nation-market-states and the reallocating of their functions between central and regional authorities. The major beneficiary has been the US in its reach for global dominance. In the late eighteenth century, a section of North Americans fought to get the English out of the thirteen colonies. Throughout the nineteenth century, the US developed the Monroe Doctrine to justify clearing all kinds of Europeans out of the western hemisphere, thereby making more room for US capital from Alaska to the Argentine. Shortly after the founder of Time-Life, Henry Luce, in 1941 proclaimed the twentieth century as "the American century", the US imperialists conquered western Europe and Japan, militarily, financially and industrially. In the 1990s, US corporations charged into the disintegrating Soviet bloc. For the twenty-first century to be another American century—as the Bush strategists pledged in their 1997 manifesto—the US imperium will have to suborn a uniting Europe, occupy the Middle East, police an unstable Latin America and restrain a potent east Asia. In the medium term, the US will also have to shift the burden of its economic crisis onto its domestic work force and its dominions. The US hyper-power must impose its pax, validate its token money, and back capital against labour. The magnitude of these tasks indicates how far the expansion of capital is from writing finis to nation-market-states.

Summing up

Globalisation Mark V can be traced back to the solution to the crisis of accumulation that struck capital in the 1930s. The "trough in unemployment" from the 1940s to the mid-1970s pushed up wages at a time when the political, industrial and ideological strength of the working classes were also unprecedented. The usual conflict between the capitalist as employer and as marketer then assumed gigantic proportions. The cost of labour time had to be attacked if accumulation were to resume. Since the 1980s, that aim has been achieved by restructurings. However, the competition between oligopolies expanded production investments just when effective demand was either being contained, or sustained by debt. The resultant excess capacity is now threatening to inscribe deflation, which will be compounded by debt traps. The drive to profitability is cutting jobs and savings, adding to deflationary pressures.

Globalisation Mark V has seen proletarianisation become worldwide as a precondition for a global reserve army of labour. The sale of labour-power is now the prerequisite for existence in the old Soviet bloc, mainland China and almostanywhere else in the Third World. Labour times have been accelerated and lengthened. The money circuit is clogged with funds that can only go around in circles: not surprisingly, the banks were the biggest US profit makers in the first quarter of 2003. The commodity circuit remains relatively open because of the policy of zero inventory. The production stage, meanwhile, is clogged by excess capacity despite the fifty per cent increase in US military spending since 2000. Those outlays, moreover, have done nothing to weaken at least one of the nation-market-states that globalisation was supposed to be dissolving. Pentagon revenues are more than twice those of Fortune 500's top performer, Wal-Mart.

Hegel believed that understanding could not be attained until after the "real" had been fulfilled as the "ideal". Marx had this assumption in his sights when he concluded his doodles on Feuerbach by remarking that while philosophers had interpreted the world, the point was to change it. This aphorism is itself misunderstood when limited to a call to arms. The changes that Marx had in mind involved all human activities: science, production and social life as much as politics. He meant that we change the world, including ourselves, through the totality of actions we call history. Equally significantly, Marx had proposed in his previous ten jottings against Feuerbach that we could understand the world—"the real"—only by working to change the subject of our investigation. On those grounds, the above appraisal of globalisation Mark V cannot be advanced without further no-global protesters and anti-war activists. Yet, activist-interpreters will not make the most out of the actualities that researchers expose without thinking beyond "the real" towards "the ideal". That pursuit will carry us ever deeper into the continuities and disjunctures that score capital's command over labour times to accelerate the circuits of its self-expansion.


1. N. Bukharin, Imperialism and the World Economy, Merlin, London, 1972, p.70.

2. Ibid., p.27

3. V.I. Lenin, Imperialism, the Highest Stage of Capitalism, Foreign Languages Press, Peking, 1975, pp. 9-10, 127-32, 151-52.

4. Asian Wall Street Journal, August 14, 2003.

5. New York Times, July 1, 2001.

6. Quoted in Richard Biernacki, The Fabrication of Labor, Germany and Britain, 1640-1914, California University Press, Berkeley, 1995, p. 383.

7. Karl Marx, Capital, I, Foreign Languages Publishing House, Moscow, 1958, p. 178.

8. E.P. Thompson, "Time, Work-discipline and Industrial Capitalism", Past and Present, 38, 1967.

9. Max Weber, The Protestant Ethic and the Spirit of Capitalism, Scribner's, New York, 1958, p. 62.

10. Karl Marx, A Contribution to the Critique of Political Economy, Progress Publishers, Moscow 1970, p. 37.

11. Ibid., p. 45.

12. Ibid., p. 36.

13. Ibid., p. 47.

14. Jeff Atkinson and Tim Connor, Sweating for Nike: labor conditions in the sports shoe industry, Community Aid Abroad, Fitzroy, 1996, pp. 7-8.

15. Business Week, November 4, 2002, pp. 107 and 110.

16. Asian Wall Street Journal, September 8, 2003,p. A2.

17. Economist, September 27, 2003, p. 76.

18. Walter Korpi, "The Great Trough in Unemployment: A Long-Term View of Unemployment, Inflation, Strikes and the Profit/Wage ratio", Politics and Society, 30 (3), 2002.

19. Mohamed Jellal and Francois-Charles Wolff, "Insecure old-age security", Oxford Economic Papers, 54 (2), 2002.

20. New York Times, March 17, 2002, p. BU5.

21. Marx, Critique, p. 35.

22. Peter Cochrane, "Gold: the durability of a barbarous relic", Science & Society, XLIV (4), 1980-81.

23. Kristen Nordhaug, "The Political Economy of the Dollar and the Yen in East Asia", Journal of Contemporary Asia, 32 (4), 2002, p. 518.

24. Karl Marx, Capital, II, Foreign Languages Publishing House, Moscow, 1957, p. 56.

25. Robert Brenner, "Towards the precipice", London Review of Books, March 6, 2003, pp. 21-22.

26. Wall Street Journal, February 12, 2003, p. A13.

27. G. Bennett Stewart, "Pension Roulette", Harvard Business Review, June 2003, p. 107.

28. Business Week, April 14, 2003, pp. 62-63.

29. Wall Street Journal, May 1, 2003, p. D1.

30. David Kucera, "Core Labor Standards and Foreign Direct Investment", International Labor Review, 141 (1-2), 2002, p. 35.

31. Donald D. Weiss, "Marx vs. Smith on the Division of Labour", Monthly Review, 28 (3), 1976, p. 110.

32. Foreign Policy, Jan/Feb 2003, p. 169.

33. Daron Acemoglu, Simon Johnson and James A. Robinson, "Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution", Quarterly Journal of Economics, CXVII (4), 2002.

34. Francois Bourguigon and Christian Morrisson, "Inequality among World Citizens: 1820-1992", American Economic Review, 92 (4), 2002.

35. Xavier Sala-i-Martin, "The Myth of Exploding Income Inequality in Europe and the World", in Henryk Kierzkowski (ed.), Europe and Globalization, Palgrave, Basingstoke, 2002.

36. Thomas Piketty and Emmanuel Saez, "Income Inequality in the United States, 1913-1998", Quarterly Journal of Economics, 118 (1), 2003.

37. Thomas Piketty, "Income Inequality in France, 1901-1998", Journal of Political Economy, 111 (51), October 2003, pp. 1004-42.

38. Richard Titmuss, "Goals of Today's Welfare State", in Perry Anderson and Robin Blackburn (eds.), Towards Socialism, Fontana, London, 1965, pp. 360-2.

39. Ellen Meiskins Wood, "Global capital, national states", in Mark Rupert and Hazel Smith (eds.), Historical Materialism and Globalization, Routledge, London, 2002, p. 30.