1. V. I. Lenin, "What Is Internationalism?" The Proletarian Revolution and the Renegade Kautsky (Peking: Foreign Language Press, 1965), p. 80.

2. V. I. Lenin, "Socialism and War," in Robert Tucker ed. The Lenin Anthology (New York: W.W. Norton & Company, 1975), p. 190.

3. V. I. Lenin, "Preface" The Proletarian Revolution and the Renegade Kautsky (Peking: Foreign Language Press, 1965), p. 3.

4. Peruvian exile Adolfo Olaechea in London is the most accurate representative of this attack on Leninism, but even more wide-scatter enemies of Leninism in the imperialist countries can be found on the "Marxism List" now called the "Marxism Space" run by the Spoons Collective on the INTERNET. Listening to them, one would have thought Zinoviev kept Lenin on a short leash using some kind of opiate.

In 1965, Mao had Lenin's work "The Proletarian Revolution and the Renegade Kautsky" republished, still with no indication that Zinoviev's name should be blotted out from history; even though Zinoviev became a counterrevolutionary in later life and even though Peruvian exile Adolfo Olaechea cites Comrade Gonzalo on the 1930s to attack what Lenin defended in Zinoviev in the teens and early 1920s.

Lenin quoted extensively from his work with Zinoviev despite the fact that Zinoviev had just betrayed the October Revolution in its most critical moments by announcing the plans of the Bolsheviks for armed insurrection to the enemy. Contrary to today's post-modernists and other idealists who don't believe there is such a thing as science, only political posturing and ideological wishful thinking, Lenin believed in science. Just because Zinoviev betrayed October, 1917 does not mean there is anything wrong with Zinoviev's prior work. "2 + 2 = 4" whether Zinoviev said it or not. Today's Mensheviks attack the MIM line calling it "Zinovievite," but in reality they are attacking Lenin and all Marxist science by striking at a perceived weak link which is also that link most unpalatable to the small section of the international working-class bought-off by imperialism and turned into another exploiting class, a variety of bourgeoisie. Anyone who starts with the definitions of Marx and Lenin, and defends their application by Zinoviev and Lenin (as Stalin later had to when a hue and cry was raised against everything Zinoviev ever said), and recognizes the method also applied by Dutt in the analysis of the situation leading to World War II-- anyone who does these things will see that MIM has simply applied the definitions that the great fighters against the Second International and social-patriotism used and MIM has reached the unavoidable conclusions for our day, many of which are unchanged from Lenin's day. None of this in any way negates the contributions of comrade Dimitrov, who came up with the correct strategy and tactics for a number of European country communist movements in the 1930s. There are those who seek to use Dimitrov as proof that Lenin and Zinoviev were wrong in their fight against social- patriotism. Adolfo Olaechea is the most precise in this regard, as he represents a kind of weathervane pointing to Bolshevik history and pointing—"turn this way!" Most revisionists long ago turned down the road Adolfo Olaechea is on, but Adolfo Olaechea's particular contribution is to gather youth to send down this road and to back hopeless organizations in England that must self-destruct. Already three organizations in England claiming to be Maoist have set themselves up to follow the RIM or Co-RIM and hail the Sendero Luminoso and already all three are defunct. Adolfo Olaechea is now working on his fourth failure for the 1990s, but the fourth organization has yet to call itself one.

5. Alan Adler, ed., "On Tactics," Theses, Resolutions and Manifestos of the First Four Congresses of the Third International (London: Ink Links, 1980), pp. 293-4.

6. V. I. Lenin, "The Working Class and Its Press," 1914, Collected Works, Vol. 20, p. 368.

7. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), pp. 20-37.

Another discussion of productive and unproductive labor is in Chapter 19 of Harry Braverman's Labor and Monopoly Capital (NY: Monthly Review Press, 1974). We agree with Braverman that as a class the workers both unproductive and productive share much in common in the imperialist countries, particularly in wages and interchangeability. However, when it comes to a theory of crisis or calculations of exploitation and international value transfers, productive versus unproductive remains a fundamental distinction. Unfortunately, the questions of imperialist oppression and super-exploitation are the ones most often left out of discussions of the conditions of working classes.

The academic discussion of the unproductive sector that we most agree with is by Nicos Poulantzas, in part III of his book Classes in Contemporary Capitalism (London: New Left Books, 1975). History has treated the first two parts of the book harshly, but part III includes correct references to the Cultural Revolution and the problem of the mental versus manual distinction in labor.

8. "The sphere of productive activity provides society with material products in the places where they are to be consumed. It can be subdivided into two sectors: the primary, in which landed property has played, historically at least, the dominant role (agriculture), and the secondary, in which it is capital that plays this historical role (industries in the strict sense, together with mining and transport). In contrast to this, unproductive activity extracts nothing from nature—which does not mean that it is useless. . . . Productive means here productive of profit, which is functionally destined to accumulation, that is, to the widening and deepening of the field of action of the capitalist mode of production. As Adam Smith observed, one become poorer by employing servants, but richer by employing workers." Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p.244.

9. Statistical Abstract of the United States, 1996, p. 859.

10. "Commercial labour is the labour generally necessary for a capital to operate as merchant's capital, to help convert commodities into money and money into commodities. It is labour which realises, but does not create, values. . . . The commercial worker produces no surplus-value directly. But the price of his labour is determined by the value of his labour-power, hence by its costs of production, while the application of this labour-power. . . is as in the case of every other wage-labourer by no means limited by its value. . . . What he costs the capitalist and what he brings in for him, are two different things." Karl Marx, Capital, Vol. III, (Moscow: Progress Publishers, 1959), pp. 297-300.

11. In some contexts, the "skilled" workers are counted as labor aristocracy. Here is another context for the definition of labor aristocracy as "straw bosses."

"Economic statistics show that here a larger percentage of the workers become 'straw bosses' than is the case in the oppressed nations, a larger percentage rise to the labour aristocracy. That is a fact. To a certain degree the workers of the oppressor nations are partners of their own bourgeoisie in plundering the workers (and the mass of the population) of the oppressed nations. (2) Politically, the difference is that, compared with the workers of the oppressed nations, they occupy a privileged position in many spheres of political life. (3) Ideologically,...the difference is that they are taught, at school and in life, disdain and contempt for the workers of the oppressed nations." Lenin, "A Caricature of Marxism and Imperialist Economism," Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 23, pages 55-56.

We thank Dennis McKinsey for collecting up selected quotes from the Collected Works of Lenin and Stalin in a book titled, "The Relevance of Marxism." Placed on the INTERNET, the quotes are easily spliced into documents and here we do so throughout.

12. "c" is for fixed capital. "s" represents surplus-labor. "v" is variable capital, often thought of as the total wages that go into the phase of production where new labor and materials are combined with fixed capital to create products.

13. Recalling Lenin's definition of imperialism above, countries starting to gather super-profits will not be "characterized" by export of capital or the dominance of super-profit. Hence, although Korea and China have some multinational corporations, they may not be imperialist yet. Although Mao believed that China would become "social-imperialist" under capitalism and that is the usage we use here in this paper, there is some question whether China has actually reached that stage yet or is just on the way.

If China and Korea like Spain are imperialist, then their workers are still in the case where superprofits LESS THAN surplus labor time. Cockshott draws this line differently and believes that even in England in the productive sector superprofits in the wages LESS THAN surplus labor time. MIM regards this dispute with Cockshott to be a friendly one, while maintaining there is more evidence for our view.

14. Lenin, "Questions of National Policy and Proletarian Internationalism," Moscow, Progress Publishers page 168.

15. Lenin, "Letter to Workers of Europe and America," Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 28, p. 433.

16. Lenin, "Imperialism and the Split in Socialism," Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 23, page 115.

17. Nikolai Bukharin of 1917 quoted in Grazia Ietto-Gillies, International Production: Trends, Theories, Effects (Cambridge, ENGLAND: 1992), p. 55. Till a few years after Lenin's death, Bukharin stoutly defended Lenin's theses on this question. At about the same time that Stalin started accusing him of rightist deviations and seeing too much capitalist stabilization, Bukharin started to buy into bourgeois productivity arguments.

18. Karl Marx, Capital, Vol. II, (Moscow: Progress Publishers, 1959), p. 513.

19. Karl Marx, Capital, Vol. III, (Moscow: Progress Publishers, 1959), p. 235.

20. Frederick Engels intro., Karl Marx, The Poverty of Philosophy (NY: International Publishers, 1963), pp. 51-2. The addition is in the 1885 edition in German.

21. Karl Marx, Capital, Vol. I, (Moscow: Progress Publishers, 1959), p. 489.

22. Karl Marx, Capital, Vol. I, (Moscow: Progress Publishers, 1959), pp. 479-80.

23. Karl Marx, Capital, Vol. I, (Moscow: Progress Publishers, 1959), p. 625. Despite this statement right in Capital, Vol. 1, on the street, MIM hears, especially from Trotskyists, that the labor aristocracy is only union officials or a few other paid-off spokespeople for the bourgeoisie in the working-class. Yet Trotsky himself signed off on the most famous COMINTERN quotes MIM uses and while he was still barely under party discipline in 1926, he wrote a book that repeatedly distinguished between labor aristocrats and labor bureaucrats in England. L. Trotsky, Where Is Britain Going? (London: Communist Party of Great Britain, 1926), pp. 158, 161. Also interesting in the same book by Trotsky is the belief shared by Stalin at the time that "the fundamental antagonism of the world is that between Britain and America, and all other antagonisms, severer at a given moment and more immediately threatening, can be understood and evaluated only on the basis of the antagonism between Britain and America." (p. 4) Of course, the one people wonder about most is "A great deal less time will be necessary to turn the Labour Party into a revolutionary party than was needed for its creation." (p. 45) This was an ultraleft thesis shared by Lenin and Stalin.

24. V. I. Lenin, Imperialism, the Highest Stage of Capitalism (Peking: Foreign Language Press, 1973), p. 128-9. To see another review by Lenin of the works of Marx on this point, see his encyclopedia entry called "Karl Marx" in his Collected Works.

25. V. I. Lenin, Imperialism, the Highest Stage of Capitalism (Peking: Foreign Language Press, 1973), p. 128.

26. V. I. Lenin, Imperialism, the Highest Stage of Capitalism (Peking: Foreign Language Press, 1973), p. 129.

One common difficulty we have here is that without examining concrete conditions of today, dogmatist-revisionist critics rip Lenin out of context to say that Lenin meant a minority of a working-class within an imperialist country is bourgeoisified. In actuality, most of Lenin's statements about a "minority" of the proletariat being bought-off refer to a minority of the global proletariat. He was quite prepared to admit that entire countries would be parasites and put forward predictions of the possibility of MIM's line.

"An insignificant minority of imperialist countries is growing rich and a large number of other countries are actually on the point of ruin." Lenin, On Peaceful Coexistence, Moscow, Foreign Languages Publishing House, page 153.

"It must be remembered that the West lives at the expense of the East; the imperialist powers of Europe grow rich chiefly at the expense of the eastern colonies, but at the same time they are arming their colonies and teaching them to fight and by so doing the West is digging its own grave in the East." Lenin, 1920, Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 42, page 196.

Against MIM, there will be those who quote earlier Lenin work on the labor aristocracy being a minority, when Lenin was clearly referring to the history of the question in the imperialist countries and how even then it had expanded (with Lenin actually revising estimates of super-profits upwards from edition to edition of his pamphlets!) Here is an example of a quote from Lenin that the revisionists throw at us. It runs counter to the later material quoted above about entire countries being parasites.

"One of the chief causes hampering the revolutionary working-class movement in the developed capitalist countries is the fact that because of their colonial possessions and the super-profits gained by finance capital, etc., the capitalists of these countries have been able to create a relatively larger and more stable labour aristocracy, a section which comprises a small minority of the working class. This minority enjoys better terms of employment and is most imbued with a narrow-minded craft spirit and with petty-bourgeois and imperialist prejudices." Lenin, Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 31, page 193.

However, Lenin was very clear on the trend of the situation. Here is a quote on the trend Lenin saw that MIM has yet to quote in published literature. We ask the reader to note the word "increasingly." "...the exploitation of oppressed nations....and especially the exploitation of colonies by a handful of 'Great' Powers, increasingly transforms the 'civilized' world into a parasite on the body of hundreds of millions in the uncivilized nations." V. I. Lenin, "Imperialism and the Split in Socialism," Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 23, page 106.

As MIM pointed out before in MT#10, Lenin had to fight to include his material on superprofits and the labor aristocracy in the party's literature and statements. Here is an example of how he would like to strengthen the emphasis as MIM would:

"The exploitation of worse paid labour from backward countries is particularly characteristic of imperialism. On this exploitation rests, to a certain degree, the parasitism of rich imperialist countries which bribe a part of their workers with higher wages while shamelessly and unrestrainedly exploiting the labour of 'cheap' foreign workers. The words 'worse paid' should be added and also the words 'and frequently deprived of rights'; for the exploiters in 'civilized' countries always take advantage of the fact that the imported foreign workers have no rights....

It would be expedient, perhaps, to emphasize more strongly and to express more vividly in our programme the prominence of the handful of the richest imperialist countries which prosper parasitically by robbing colonies and weaker nations. This is an extremely important feature of imperialism. To a certain extent it facilitates the rise of powerful revolutionary movements in countries that are subjected to imperialist plunder, and are in danger of being crushed and partitioned by the giant imperialists...and on the other hand, tends to a certain extent to prevent the rise of profound revolutionary movements in the countries that plunder, by imperialist methods, many colonies and foreign lands, and thus make a very large (comparatively) portion of their population participants in the division of the imperialist loot."

Lenin, Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 26, pages 168-169.

28. V. I. Lenin, Imperialism, the Highest Stage of Capitalism (Peking: Foreign Language Press, 1973), p. 120. We would point out that this quote from Lenin occurs in the essay before later quotes from Engels and so Lenin should no way be seen as paying mere lip-service to Engels on this question. It was no idle review of Engels by Lenin.

Other quotes about parasitism of "rich imperialist countries," and the "citizens" not just the bourgeoisie of the imperialist countries can be found in Lenin's fight to revise the party program. "Revision of the Party Programme," Collected Works, Vol. 26, pp. 168-9.

29. See for example, "The Second Congress of the Communist International," Collected Works, Vol. 31, (Moscow: Progress Publishers, 1960), p. 261.

30. V. I. Lenin, "Socialism and War," Collected Works, Vol 21, p. 319.

31. See "How the Bourgeoisie Utilises Renegades," 1919, Collected Works, Vol. 30, p. 34. The same article talks about "workers in Britain BECOMING INCREASINGLY BOURGEOIS." (capitals instead of italics.)

32. "We have given scarcely any thought to possible retreat, and to preparations for it. Yet that is a question which. . . absolutely requires our attention. We must not only know how to act when we pass directly to the offensive and are victorious." V. I. Lenin, "The Fourth Congress of the Communist International," Collected Works, Vol. 33, p. 420-1.

33. V. I. Lenin, "Debates in Britain on Liberal Labour Policy," published in 1913, Collected Works, Vol. 10, pp. 60-1.

34. V. I. Lenin, "The Collapse of the Second International," Collected Works, Vol. 21, p. 250.

In the same essay, he refers to "the semi-petty-bourgeois aristocracy of the working class." Another interesting point is how what used to be called a "legitimate shade" within the party or movement has turned into outright traitors during World War I. Lenin was referring to people he had broken with earlier on other subjects unconnected with World War I. On a related note, he said, "In the past, before the war, opportunism was often looked upon as a legitimate, though 'deviationist' and 'extremist', component of the Social-Democratic Party. The war has shown the impossibility of this in the future. Opportunism has 'matured', and is now playing to the full its role as emissary of the bourgeoisie in the working-class movement. Unity with the opportunists has become sheer hypocrisy." "Socialism and War," Collected Works, Vol. 21, p. 311.

35. See V.I. Lenin, "Opportunism and the Collapse of the Second International" and "The Collapse of the Second International," Collected Works, Vol. 21, pp. 257, 444. Note that this issue of a stratum of the working-class being converted to petty-bourgeoisie is different than the issue of the party and movement having people of petty-bourgeois origins. That Lenin said in 1915 had been going on for a long time. See "What Next?" Collected Works, Vol 21, p. 109.

36. See "How the Bourgeoisie Utilises Renegades," 1919, Collected Works, Vol. 30, p. 34.

37. "This is the economic factor that enables the imperialist bourgeoisie to obtain superprofits, part of which is used to bribe the top section of the proletariat and convert it into a reformist, opportunist petty bourgeoisie that fears revolution."-- V. I. Lenin, 1919 "Letter to Workers of Europe and America," Collected Works, 45 Volumes, Moscow, Progress Publishers, 1960, 1963-1970, Vol. 28, p. 433.

"The industrial workers cannot accomplish their epoch-making mission. . .if they. . . smugly restrict themselves to attaining an improvement in their own conditions, which may sometimes be tolerable in the petty-bourgeois sense. This is exactly what happens to the 'labor aristocracy' of many advanced countries, who constitute the core of the so-called socialist parties of the Second International; they are actually the bitter enemies and betrayers of socialism, petty-bourgeois chauvinists and agents of the bourgeoisie within the working-class movement." V. I. Lenin, "Preliminary Draft Theses on the Agrarian Question," Collected Works, Vol. 31, (Moscow: Progress Publishers, 1960), pp. 152-3.

"The bourgeoisie, by plundering the colonial and weak nations, has been able to bribe the upper stratum of the proletariat with crumbs from the super-profits, to ensure them in peace-time a tolerable, petty-bourgeois existence." V. I. Lenin, "Draft Program of the R.C.P.(B.)," published 1930, Collected Works, Vol. 29, p. 104.

In the "Marxism Space" on the INTERNET, MIM encountered "Gina" and others who thought it ridiculous that the petty-bourgeoisie or labor aristocracy would try to smuggle itself into the proletarian movement, contrary to what Lenin said, and what various signers of the "Basle Manifesto" also said.

38. V. I. Lenin, "Third Congress of the Communist International, June 22-July 12, 1921," Vol. 32, Collected Works (Moscow, Progress Publishers, 1965), p. 454.

39. "One trend is that of the revolutionary workers who have just joined us and are opposed to the labour aristocracy; the other is that of the labour aristocracy, which in all civilised countries is headed by the old leaders. Does Crispien belong to the trend of the old leaders and the labour aristocracy, or to that of the new revolutionary masses of workers, who are opposed to the labour aristocracy?" V. I. Lenin, "Speech on the Terms of Admission into the Communist International July 30," Collected Works, Vol. 31, (Moscow: Progress Publishers, 1960), p. 247. Lenin refers to Crispien as a Kautskian and we find this speech of Lenin's on the terms of admission to the COMINTERN the most useful in his demarcation efforts.

Similar remarks on the two trends, "Letter to the German and the French Workers," Collected Works, Vol. 31, p. 281.

40. V. I. Lenin, "The Second Congress of the Communist International," Collected Works, Vol. 31, p. 231. The preceding paragraph was about the labor aristocracy of "America, Britain and France. . . The purging of the workers' parties, the revolutionary parties of the proletariat all over the world, of bourgeois influences, of the opportunists in their ranks, is very far from complete."

41. V. I. Lenin, "The Second Congress of the Communist International," Collected Works, Vol. 31, p. 245.

42. In contrast, what Adolfo Olaechea is doing today is hiding in Dimitrov's theses on the united front and substituting those for what Lenin, Stalin and Dimitrov believed about parties as opposed to the united front.

43. Lenin added he was not happy with the verbal acceptance of this fact by the Italians, because it was not true in practice. "On Struggle Within the Italian Socialist Party," Collected Works, Vol. 31, p. 388.

Similar references occur in "Theses on the COMINTERN's Fundamental Tasks," Collected Works, Vol. 31, pp. 191, 193.

44. Lenin had previously tied super-exploitation to the national question.

"The important thing is not whether one-fiftieth or one-hundredth of the small nations are liberated before the socialist revolution, but the fact that in the epoch of imperialism, owing to objective causes, the proletariat has been split into two international camps, one of which has been corrupted by the crumbs that fall from the table of the dominant-nation bourgeoisie--obtained, among other things, from the double or triple exploitation of small nations." Lenin, "The Discussion on Self-Determination Summed Up," Collected Works (Moscow: Progress Publishers, 1965), p. 343.

45. Harry Haywood, "Against Bourgeois-Liberal Distortions of Leninism on the Negro Question in the United States," in Philip Foner & Robert Shapiro, eds., American Communism and Black Americans (Philadelphia: Temple University Press, 1991), pp. 29-33. This book is in general an excellent source and historical background to MIM's own concepts and language. The major difference between the Stalin-era CP-USA and MIM now is that MIM believes that since that time it has become no longer questionable that a majority of white workers have become parasites and hence the basis for white national chauvinism exists in the majority.

46. Harry Haywood, "Against Bourgeois-Liberal Distortions of Leninism on the Negro Question in the United States," in Philip Foner & Robert Shapiro, eds., American Communism and Black Americans (Philadelphia: Temple University Press, 1991), pp. 29-33.

47. We speak here of a number of people on the now defunct Marxism List, including "Gina," the defender of the CoRIM, but also the Detroit Peru Support Committee, egged on by Adolfo Olaechea and the "MPP-USA." The list is still stored and available by Spoons at jefferson.village.virginia.edu.

48. In the U$A, "The number of black farmers around the country has plummeted from almost one million 1920 to fewer than 20,000 today. . . . In 1910 African-Americans owned some 15 million acres of agricultural land; today that figure stands at about 4 million acres. Over the last two decades, black-owned farms in Arkansas went out of business 10 times faster than white-owned farms." (Boston Globe, 8June97, p. D1.)

49. Earl Browder, "For National Liberation of the Negroes! War Against White Chauvinism!" in Foner & Shapiro eds., American Communism and Black Americans (Philadelphia: Temple University Press, 1991), p. 196. Browder later led the dissolution of the Communist Party USA with the idea of lending to the peace effort between the Soviet Union and the United $tates. Despite Browder's turn to revisionism, at the time of his intervention on the Black nation, he was following Stalin's line.

50. Mao Tse-Tung, "Statement by Comrade Mao Tse-Tung, Chairman of the Central Committee of the Communist Party of China, in Support of the Afro-American Struggle against Violent Repression," (Peking: Foreign Language Press, 1968), p. 3.

51. Liu Chun, "The National Question and Class Struggle," (Peking: Foreign Language Press, 1966).

52. Grazia Ietto-Gillies, International Production: Trends, Theories, Effects (Cambridge, ENGLAND: 1992), p. 25-6. The frenzy for finance and trade services investment and financial portfolio investments relative to direct investments is in striking contrast to a mere 22 years ago when N. Poulantzas was writing about how U.$. direct investment was re-organizing European capitalism and even creating forms of dependency. Classes in Contemporary Capitalism (London: New Left Books, 1975), pp. 51, 60-1, 65.

The 1990s was another phase of heavy outward orientation of U.$. capital. Since 1985, the percentage of direct investment going to the Third World has increased again. Net U.$. flows of capital to East Asia went from $35 billion in 1991 to over $100 billion in 1995. Globally it is true as well, as the share of FDI (Foreign Direct Investment) going to the Third World went from 12 percent in 1990 to 38 percent 1995.

Total U.$. investment abroad went up 65 percent between 1990 and 1995, but the investment in the Third World doubled. "Chapter 7," Economic Report of the President, 1997.

53. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 2.

54. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 20.

55. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 23.

56. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 70. The problem with exchange rates is that they are influenced by inflation and political perceptions of the futures of various countries. For instance, will the fight over the superprofits going into the welfare state result in a relatively large deficit? That might cause inflation and currency devaluation. It might also cause the interest rate to go up. Such issues are irreducibly political and speculators will never eradicate them except by conducting their business at set exchange rates with future currency swaps at specific rates built into their deals.

57. Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. 70.

58. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 179.

59. U.$. production was 20 percent of global production in the early 1990s, using the distorted statistics of the bourgeois economists and an even larger share of total imperialist production. Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. xiv.

60. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), pp. xv - xvi.

61. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 20.

62. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 138.

63. In 1915 Lenin wrote, "A United States of Europe is possible as an agreement between the European capitalists. . . but to what end? Only for the purpose of jointly suppressing socialism in Europe, of jointly protecting colonial booty against Japan and America." "On the Slogan for a United States of Europe," in Robert Tucker ed. The Lenin Anthology (New York: W.W. Norton & Company, 1975), p. 202.

On NAFTA, Gary Hufbauer, a former official of Jimmy Carter's presidency said, "The danger of the 1990s is that antagonistic regional trading blocs could emerge as a consequence of existing free trade areas." Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 376.

64. The Communist Party USA and Revolutionary Communist Party USA are tailing after these reactionary bourgeois elements with national loyalties to the U$A. Their approach is not Marxist.

"To describe every interference of the state in free competition--protective tariffs, guilds, tobacco monopoly, nationalization of branches of industry...as 'socialism' is a sheer falsification by the Manchester bourgeoisie in their own interests." Marx and Engels, Selected Correspondence, Moscow, Progress Publishers, 2nd Edition, 1965, page 340.

65. Lester C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 23.

66. Henry J. Aaron, Ralph C. Bryant, Susan M. Collins and Robert Z. Lawrence, "Preface," in Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. xi.

67. in Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. 46.

68. Seth Godin, ed., 1995 Information Please Business Almanac and Sourcebook (Boston: Houghton Mifflin Company, 1994), p. 356.

69. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), (Gillis et. al. hereafter), p. 386. Of course, the economists underestimate the assets held in the Third World, because the puppet regimes of poor countries unable to pay high salaries to officials are easily bribed to look the other way for tax purposes--hence a considerable accounting problem in examining Third World assets of multinational corporations.

70. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 183. We recommend this book as a superior sequel to Global Reach. We disagree with Greider, but we communists should know the facts he is talking about.

Greider believes that financial assets internationally managed to grow themselves 6 percent a year between 1980 and 1992. Since that pace outstrips the growth of the economy, it represents the growing dominance of finance capital at the expense of other sectors. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 232.

71. Lester C. Thurow, Zero Sum Solution: An Economic and Political Agenda for the 1980s (NY: Simon & Schuster, 1985), p. 150.

72. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 308.

73. The idea of globalization is nothing new. Already in 1973, Samir Amin was specifically debunking that thesis. "Just as one cannot understand the capitalist mode on the basis of empirical observation of reality at the level of the capitalist enterprises (where what appears is prices and profits, not values and surplus value), one cannot understand the world capitalist system on the basis of empirical observation of the multinational corporations." Samir Amin, The Law of Value and Historical Materialism (NY: Monthly Review Press, 1978), p. 65. The problem with the globalization thesis is that it leads both bourgeois economists and national chauvinist "Marxists" to simplify their assumptions, so that they can speak of economics without considering the national question and superexploitation, as if the world were already one laissez-faire, Liberal political entity. It is especially annoying to see Marxists speak of a free market for labor-power, when Marx and Lenin both believed that super-exploitation under non-Liberal conditions occurred all too often. By proving that exploitation is possible under a free market system, Marx was only letting the bourgeois economists have their best shot while proving them wrong even in that case.

74. Economist Adrian Wood argues that we already face one globally integrated market for capital and technology, such that manufacturing production in the Third World occurs at no capital or technology disadvantage compared with the advanced industrial countries, especially when one considers the work of multinational corporations.

Wood goes so far as to say profit rates are the same in the Third World and the industrialized countries. As far as MIM is aware, however, this is still not the case and an unwarranted assumption made just because it is attractive and easy to bourgeois economists. The investors usually justify higher rates of return by saying they took higher risks in the Third World, with political instability as one reason.

"The stock market in Hong Kong has generated a twenty-year average annual return of 21 percent; India's yield was 18 percent, Argentina's 28 percent, compared to 11 percent in the U.S. stock market or Germany's." William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 235.

Samir Amin also sees a different rate of profit in the two geographic areas, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p.162 On the other hand, if profit rates did equalize that would be fine for the long-run Marxist view of capitalism. At that point, we would also expect a severe crisis driven by a globally declining profit rate.

75. V. I. Lenin, "The Right of Nations to Self-Determination," (Moscow: Foreign Languages Publishing House, 1951), pp. 14-5. Again, against the pissants of "pc" like Adolfo Olaechea who act out the Trotskyist caricature of Stalinism as if to prove the Trotskyists right, we ask the readers to note that Stalin had this essay republished in 1951 and did not add in words attacking Kautsky for his subsequent betrayal of socialism and aiding the bourgeoisie to perpetrate World War I. Rather the favorable quotes of Kautsky are left in, because materialists have a scientific approach to truth, no matter who speaks it.

76. Opposing the use of the term "general crisis" to apply to an "entire phase," N. Poulantzas correctly points out is that "these analyses imply, in their underestimation of the conjunctures of class struggle to which alone the term crisis can properly be applied, is that imperialism or capitalism will somehow collapse by themselves, by virtue of their own 'economic contradictions'." He correctly points out it depends on the struggle what will happen. Classes in Contemporary Capitalism (London: New Left Books, 1975), p. 48.

77. One might object with the example of urbanization in some places of Latin America. However, as Lester Thurow points out in his own way in his book Head to Head, Chile and Argentina were already two of the world's richest twenty countries in 1870, before imperialism appeared. To say that imperialism is not decadent, because it does not hold back urbanization or relative development in those countries would be to miss that they were in relatively good position before imperialism.

78. Jose Edgardo Campos and Hilton L. Root, The Key to the Asian Miracle: Making Shared Growth Credible (Washington, DC: Brookings Institute, 1996), p. 31n.

79. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 59.

80. Japanese Marxists had some disagreements over this point, understandably on whether it was the land reform that smashed feudalism or the Meiji Restoration of 1868. At least one major theorist argued that it was the land reform that completely smashed the feudal class—Hyakuju Kurihara. Another major view is that it made capitalist agriculture more efficient and popular by redistributing from large landowners. Makoto Itoh, Value and Crisis (NY: Monthly Review Press, 1980), pp. 31, 36. Itoh's book is also good on the subject of the Marxist theory of crisis.

81. Takashi Hikino & Alice H. Amsden, "Staying Behind, Stumbling Back, Sneaking Up, Soaring Ahead: Late Industrialization in Historical Perspective" in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 298.

82. The gini coefficient in Mao's China was .22. Japan is .29. Taiwan is .33 and U.$. occupied Korea is .38, but Peru is .46, Mexico .53 and Brazil .57. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass, Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), p. 76.

More recent measures for Taiwan and U.$.-occupied Korea are .30 and .31 respectively in 1989 and 1988 respectively. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), pp. 229, 231.

83. Herman Kahn, "The Confucian Ethic and Economic Growth," in World Economic Development: 1979 and Beyond (Boulder, CO: Westview Press, 1979).

84. In the 1970s it may have been questionable as Samir Amin said in Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p. 213, but by 1997 we can no longer doubt the success of the "Little Dragons."

85. Lester C. Thurow is one of those who admitted in the Zero Sum Game that capitalist country failures are far more numerous than capitalist country successes. He points out that in both Africa and Latin America, per capita income actually fell. It's not just a matter of falling behind. It's a matter of absolute immiseration. C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 214.

86. The Dean of one of Amerika's foremost business schools, Lester C. Thurow said, "The late 1920s and early 1930s began with a series of world-wide financial crashes that ultimately spiraled downward into the Great Depression. As GNPs fell, the dominant countries each created trading blocks (the Japanese Co-Prosperity Sphere, the British Empire, the French Union, Germany plus eastern Europe, America with its Monroe Doctrine) to minimize imports and preserve jobs. . . . with everyone restricting trade, the downward pressures were simply magnified. . . . Eventually, those economic blocks evolved into military blocks, and World War II began." C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), pp. 55-6.

87. The same analysis can be found in Chapter 7 of the Economic Report of the President, 1997.

88. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), pp. 9-13.

89. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 14.

90. Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. 8.

91. "Between 1981 and 1986, 42 percent of Korea's growth and 74 percent of Taiwan's growth could be traced to exports to the American market." C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 62. This is all the more remarkable, because by that time, both these economies were very successful. We would guess that the two economies were even more dependent on exports to the United $tates prior to 1981.

92. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 25.

93. "Chapter 7," Economic Report of the President, 1997.

94. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 46.

95. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 237.

96. 1994 figures in 1994 dollars. Up from $91.1 billion in 1992 counting exports that are not merchandise, Taiwan reached $106.9 billion in exports in 1994. China reached $119.8 billion in 1994 up from 88.8. U.$.-occupied Korean exports were $95.4 in 1994. http://oracle.tradecompass.com/ows-bin/oowa/ExpSrv60/dbxwdevkit/xwd_init?wrldcode/sysstart In this set of figures Hong Kong is counted separately from China; even though, Hong Kong simply re-exports much material it got from China. Hong Kong imported $32.7 billion from China and exported $151.1 billion in 1994.

97. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 163, 295.

98. The Reagan administration left with more than double the percentage of imports under some kind of trade restriction as when Reagan started in 1980. Nixon delayed the inevitable surge of Third World imports by placing tariffs on textile imports and winning the presidency according to some by such promises. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 355. In Reagan's first year in office, the value of imports with no tariff duties on them fell by a quarter. In Reagan's second year in office, the total imports actually fell for the only year between 1980 and 1995. Under Clinton in 1995, the share of trade with no tariffs reached 51 percent for the first time. The average tariff reached a low of 2.5 percent. This has happened along with an expansion of trade, so it is not just a matter of trade occurring where there are no tariffs and bringing down the average. (Statistical Abstract of the United States 1996, p. 806). Bourgeois internationalists consciously groomed Carter, Bush and Clinton for power at the expense of the Amerika-First bourgeoisie. Truman, Eisenhower, Kennedy and Johnson were more natural bourgeois internationalists. Nixon and Reagan were the least internationalist in outlook; although both were forced to compromise with the bourgeois internationalists repeatedly.

99. Just like King Cotton, Clinton says, "'habits of commerce run counter to the habits of war.'" The message is the same: keep trading and bite the bullet if you lose the competition. On the other hand, Clinton's trade representative announced "'There is no such thing as free trade. . . . You have to have rules of the road.'" Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), pp. 385, 387.

100. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 32, 64.

101. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 24.

102. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), pp. 7-10. In the end, the U.S. Government including its Secretary of Defense, Vice-President and President decided not to make too much of a stink about this and the company that sold the technology to the Soviet Union, Toshiba did not have its sales banned in the United States as punishment. Japan-basher Choate says Japan should have been punished and that it is the fault of highly-paid lobbyists who work for the U.S. Government one day and Japan the next day that Japan always escapes tough action from the United States.

103. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 84.

104. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 38.

105. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 42.

106. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 62.

107. The "G-2" idea is more or less a Japanese chauvinist joke at the expense of Canada, France, Germany, Italy and the "United Kingdom" which are the other members of the "G-7," which stands for Group of Seven major industrial economies. It is a call to the world's largest market by Japan to ditch the Europeans and give Asia its due. Others miffed by the "G-7" idea are obviously Russia and China, since they were never included despite having much larger industrial sectors than most of the "G-7." According to the Clinton administration, the "G-7" finance ministers and central bankers meet several times a year to coordinate macroeconomic policy.

108. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), pp. 108-9, 126.

109. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), pp. 81-2, 133.

110. Edward J. Lincoln, Japan's New Global Role (Washington, DC: Brookings Institution, 1993), p. 170, 178, 181.

111. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 125.

112. Shintaro Ishihara, The Japan That Can Say No: Why Japan Will Be First Among Equals (NY: Simon & Schuster, 1991), p. 29.

113. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), pp. 19, 21.

114. Economic Report of the President, 1997, "Chapter 7." To obtain a copy of this Clinton administration propaganda, go to wais.access.gpo.gov.

115. Yoichi Funabashi ed., Japan's International Agenda (NY: New York University Press, 1994), p. 17.

116. Foreigners have 1 percent of Japan's assets, 9 percent of U.$. assets and 17 percent of West Germany's assets. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), pp. 158-9.

117. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), pp. 80-1.

118. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), p. 42.

119. C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 126. Looking at stockholder equity as opposed to dividends helps to capture the reinvestment of Japanese corporations. Based on that figure, profits for Japanese corporations in the world's 50 largest are 9.1 percent, still lower than the 13.3 percent for American companies, but higher than the dividend figures would represent. C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 143.

120. David Dollar & Edward N. Wolff, "Capital Intensity and TFP Convergence by Industry in Manufacturing, 1963-1985," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 214.

121. According to Wood, "Interest rates and profit rates are much the same in the South as in the North, largely because financial capital is mobile. Most capital goods, moreover, can moved freely around the world (machinery) or constructed anywhere in a year or two (buildings)." Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 5.

122. Takatoshi Ito, "U.S.-Japan Macroeconomic Policy Coordination," Yoichi Funabashi ed., Japan's International Agenda (NY: New York University Press, 1994), p. 96. The same author asks for Japanese entrance into NAFTA. R. Taggart Murphy also says that the "pump priming" ideas of Western economist John M. Keynes only result in capital formation in Japan, not a real boost in consumer demand. The Weight of the Yen (NY: W.W. Norton, 1997), p. 129.

123. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), p. 212.

124. Heizo Takenaka, "Japan's International Agenda: Structural Adjustments," inYoichi Funabashi ed., Japan's International Agenda (NY: New York University Press, 1994), p. 171 is an example of concern for consumers.

125. Makoto Sakurai, "Japan's Role in Economic Cooperation," in Yoichi Funabashi ed., Japan's International Agenda (NY: New York University Press, 1994), p. 145-6. Like other books and authors reviewed in this essay, we see the language of "trade wars" and the connection of trade conflicts to "national security." The workers should understand that the academic and political leaders of imperialist countries do not pretend to behave other than Lenin said they would in trade bloc conflicts. Lenin's understanding of inter-imperialist rivalry and trade bloc dynamics is one of his most important contributions and its truth is revealed in just about every book written on foreign trade and the subject of economic competitiveness. Understanding just land reform and trade blocs since World War II will take the worker far into understanding the changing fortunes of various countries.

126. Grazia Ietto-Gillies, International Production: Trends, Theories, Effects (Cambridge, ENGLAND: 1992), p. 22.

127. Edward J. Lincoln, Japan's New Global Role (Washington, DC: Brookings Institution, 1993), pp. 59-60.

128. With the help of negative publicity for Japanese direct investment, the United Kingdom took back its lead in foreign direct investment in the United $tates in 1993 and 1994, with $113.5 billion against Japan's $103.1 billion in 1994. (Statistical Abstract of the United States, 1996, p. 788) However, these numbers are dwarfed by Japan's loans of cash to the U.S. Government.

129. USA Today 25June97, p. 3b. The scenario of Japanese financing in cash as opposed to direct investment is completely unmentioned in N. Poulantzas's work on the subject of foreign direct investment 22 years ago. It is a shift in importance of countries and forms of capital export that was unthinkable in the European or Amerikan mind of the time.

130. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), p. 218.

131. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), pp. 219-27.

132. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 42.

133. Richard C. Marston, International Financial Integration: A Study of Interest Differentials between the Major Industrial Countries (Cambridge, ENGLAND: Cambridge University Press, 1995), pp. 149-51, 166. We would also counter Adrian Wood on this same point, because Wood believes that the whole world is already facing a uniform interest and profit rate. We have to ask, for whom and how often is capital available for borrowing—but we do see it as inevitable that capitalism will head in the direction Wood says. Nationalist politicians are the main obstacle.

134. R. Taggart Murphy, The Weight of the Yen (NY: W.W. Norton, 1997), p. 208.

135. Martin Carnoy, "Whither the Nation-State?" in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 71.

136. This idea does not work in the U.$.-Japan relationship, because the U.$. dollar is the preferred international currency of exchange and so demand for the dollar is always too high, not for any reason having to do with its exports or inflation rate at home. Since Charles De Gaulle the president of France a generation ago, there have been those imperialist politicians who maintain that this results in a transfer of wealth to the United $tates. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 109. On the other hand, Japan is unwilling to take on the role of "global hegemon" and the reason according to one investment banker in Japan named R. Taggart Murphy is that the Ministry of Finance in Japan does not want to lose control of its currency by having larger quantities of yen held by the public outside Japan. We might expect this position to evolve especially if Japan orients itself to more of an East Asia and Russia trading bloc.

137. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 21.

138. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 115.

139. Leonard Beeghley, The Structure of Social Stratification in the United States, 2nd ed., (Boston: Allyn & Bacon, 1996), p. 85.

140. Adolf Hitler, Mein Kampf, (Boston: Houghton Mifflin 1971), p. 291. We thank William Greider for warning against this sort of old view in the imperialist countries that only they can do "high caliber" work. He sees it possible everywhere. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), pp. 20, 74.

141. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), p. 12.

142. Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 2. Fernando Henrique Cardoso had been an important theorist of development closer to Marxism than bourgeois apologetics until he became Minister of Foreign Affairs in Brazil and then elected president. His essay in this book is an about-face. Whereas he was known for advocating a nationalist position against getting entangled with imperialist efforts to "develop" the Third World, he now joins authors ridiculing the nationalism of Islam and the Sendero Luminoso. "We are dealing, in truth, with a crueler phenomenon: either the South (or a portion of it) enters the democratic-technological-scientific race, invests heavily in R&D, and endures the 'information economy' metamorphosis, or it becomes unimportant, unexploited, and unexploitable." (p. 156) This is a position not unlike Fanon's more bleak outlooks on the breakdown of dialectics, a loss of interconnectedness, such that societies can be irrelevant to each other.

The line of these authors is almost word for word U.$. government propaganda. According to the Clinton administration in the Economic Report of the President, 1997, Chapter 7, "The amount of information required for planning to work far exceeded the planners' ability to gather and process it. . . . The managers of socialist enterprises lacked incentives to innovate. . . . The Communist countries made another major blunder: as a matter of policy, they insulated themselves from the world economy and ignored the opportunities that international trade offers." This latter part is laughable considering the embargoes placed by the imperialists. It was illegal for U.$. occupied Koreans to trade with their independent brothers and sisters in the North. Cuba was physically blockaded by U.$. imperialism and the United $tates dropped more bombs on IndoChina than all bombs dropped in World War II. This the imperialists remember as the communists rejecting trade!

143. Martin Carnoy, "Whither the Nation-State?" in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 53. Carnoy goes on to say that 90 percent of Japanese multinational corporate assets are in Japan, but that of course is exaggerated by the relative asset inflation in Japan discussed elsewhere.

144. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 27.

145. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 50.

146. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 53.

147. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 382.

148. Reagan gave a speech and a media extravaganza for the $2 million. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 176.

149. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), pp. 309-10.

150. C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 36, 32. According to Lester C. Thurow, both England and the United $tates are stuck in Anglo-Saxon individualism and face a competitive disadvantage from their own cultural traditions and ideology. In East Asia, China is growing the fastest, at 9 percent a year, but somehow the Amerikans and English do not get the picture and go on grinding out more free market triumphalist pulp fiction.

151. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 335. As we go to press in July, 1997, the U.S. Government approved Boeing's purchase of its main but lagging aerospace competitor McDonnell Douglas. Boeing contracts are written with U.$. airlines in such a way that those airlines are not allowed to buy their planes anywhere else for the next 20 years. This closes off 11 percent of the global market to Airbus. (USA Today, 2Jul97, p. 1) This has angered Airbus, which itself has angered the United $tates in the past, because it was formed by state-capital in Europe, smacking of "socialist" "subsidies" in U.$. ruling-class opinions. Airbus is screaming for U.$. airlines to be deprived of a certain number of landing rights at European airports, as a retaliation against Boeing. "Managed trade" theorists have targeted the aerospace industry as one of the few industries with a future creating "good jobs," which is why governments all across the globe may start trade wars over it.

152. Lester C. Thurow, Zero Sum Solution: An Economic and Political Agenda for the 1980s (NY: Simon & Schuster, 1985), p. 381.

153. See for example the admission about CIA recruitment of several hundred media members abroad, its covert operations and the operations of the US "Information Agency." Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 163.

154. Pat Choate, Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (NY: Alfred A. Knopf, 1990), p. 149. Adrian Wood also admits that by one important bourgeois method of thinking, exports by the South to the North have a net negative effect on demand for labor in the South. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 69.

It is for Wood's openness to ideas and data that we value his bourgeois academic work more than others. To MIM, this is an indirect capturing by Wood of the vicious cycle of transfer of value to the North, followed by a lowering of purchasing power and capital in the South, leading to it being even more attractive to export to the North as a quick fix. In countries with landed classes in power, it does not work at all.

155. William Lazonick, "Social Organization and Technological Leadership," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), pp. 184-5.

156. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 348.

157. Martin Carnoy, "Whither the Nation-State?" in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 51.

158. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 22. This is another area where N. Poulantzas's book Classes in Contemporary Capitalism published in 1975 is seriously out-of-date. Just as Lenin, Trotsky and Stalin all thought it would be the British-Amerikan contradiction that was principal after World War I, Poulantzas's ideas of inter-imperialist rivalry have been shown wrong less than 20 years later. Getting inter-imperialist rivalry right seems to be very difficult for us communists, especially with any degree of prediction for the future.

159. Lester C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 31.

160. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 391.

161. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), pp. 11-2.

162. Steve Dryden, Trade Warriors: USTR and the American Crusade for Free Trade (NY: Oxford University Press, 1995), p. 41.

163. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 1.

164. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 100, 102.

165. One of the better organizations falling for the line economic nationalist line of reasoning is "A/Synechia" of Greece. Their article "On the 'European Union'" from November, 1993 correctly pinpoints German dominance, but speaks for dissolution of the "European Union." They argue that the European Union means imperialist unity and alliance. Seeking to withdraw a socialist Greece would be one thing, but calling for imperialist disunity and effectively uniting with the reactionary labor aristocracy and non-monopoly capital to do so is another thing. However, we do agree that there is a "need for an internationally co-ordinated struggle of the working class." A/Synechia is also anti-GATT, but supposing we proletarians could tip the balance right now without going to socialism in each of our countries, and supposing we undid the last 50 years of GATT, what would be the result? The result would be an accelerated impetus to imperialist rivalry, a new scramble to re-divide the world. Unless, seizing socialist power (and protecting its industry from the outside capitalist world) is on the agenda, we should not sloganeer like the KKK and other most-chauvinist sections of the reactionary classes. Let us instead hold these imperialists to their free trade, free border-crossing and internationalist rhetoric and show that communism is the only guarantee of internationalism and peace.

The Communist Party of Spain (Reconstituted) has a better line on the question of how the Europeans approach the NATO, EU and GATT. "Their conception of the world obeys to the situation of the petty-bourgeoisie which crushed by the transnationals and finding no hope for the future, centers all its attacks on the imperialist State." Karl Marx Commune, Soria Prison (Spain), February, 1987. The intention was to criticize those engaged in armed struggle who target the enemy but without forming an underlying class basis for a party and program. However, the same could be said of those seeking to sink the European Union. The petty-bourgeoisie threatened by monopoly capital seeks only to be done with these individual treaties and manifestations of monopoly capital's power. It has no replacement or overall strategy beyond that.

166. http://www.france.diplomatie.fr/frmonde/euro/eu22.gb.html

167. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), pp. 132-3.

168. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 201.

169. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 77.

Greece, Spain, Italy and Portugal may have been catching up without EU assistance. Bourgeois economists speaking of the developed society "club" say that they were averaging about 2 percent a year catch-up with the United $tates between 1950 and 1989. This makes European Union unity an easier historical occurrence for the ruling classes of Europe. Out of 42 places examined, only Taiwan, Korea and Japan did better. Angus Maddison, "Explaining the Economic Performance of Nations," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 27.

170. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 203.

171. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 110 footnote. See also p. 117 for what currencies the European Community residents prefer to have in their accounts.

172. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 84.

173. Grazia Ietto-Gillies, International Production: Trends, Theories, Effects (Cambridge, ENGLAND: Polity Press, 1992), pp. 198-202.

174. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 107.

175. Peter B. Kenen, Economic and Monetary Union in Europe (Cambridge, ENGLAND: Cambridge University Press, 1995), p. 25.

176. The head German central banker said he would prefer the new European currency to be called the mark. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 243.

177. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 170.

178. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 225.

179. Stephen S. Cohen, "Geo-Economics and America's Mistakes," in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 99.

180. The Communist Party of China says it has a long-run goal of going toward floating exchange rates. In July, 1996 it tried to make it sound like it opened a market for foreign companies to trade in China's currencies without government intervention. "Implementation of the new measure represents a major step leading to the eventual convertibility of the renminbi under current accounts." What it did was say the companies could go directly to the People's Bank of China to settle their currency exchanges, thereby supposedly increasing efficiency. The renminbi is the Chinese currency.

"Implementation of the new measure has narrowed the gap between China's existing exchange control system and stipulations in Article 8 of the Agreement of the International Monetary Fund. The effort has also demonstrated China's determination to further its opening policy. At the same time, ongoing implementation effort has created favorable conditions for ensuring the future free convertibility of the renminbi." BEIJING REVIEW, Vol. 39, No. 39, SEPTEMBER 23-29, 1996.

181. "Chapter 7," Economic Report of the President, 1997.

182. "Chapter 7," Economic Report of the President, 1997.

183. Collected Works, Vol. 31, p. 230.

184. In the 1980s, one percent owned 50 percent of the wealth in the United $tates. Perlo also points to Domhoff who uses 0.5 percent as capitalist class. The smaller the class, the less surplus-value we have to account for, so to humor our critics we take the larger 1 percent figure. Perlo also is useful in admitting that he thinks the 100 billionaires worth $225 billion in the 1980s is significant enough to disallow our thesis that the oppressor nation workers are not exploited. He also admit that the capitalists only spend 5 to 10 percent of their wealth, so to account for capitalist wealth, we need only account for net capital formation owned by the capitalist class and add 5 or 10 percent to understand what surplus-value does not go to the unproductive workers and petty-bourgeoisie. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), pp. 3, 51, 53.

If we take the people who in 1989 had net worth $1 million or more as capitalist, then we are only talking about 0.64 percent of the population as capitalist. If we add in those also worth $600,000 or more, we get to 1.34 percent of the population as capitalist. Leonard Beeghley, The Structure of Social Stratification in the United States, 2nd ed., (Boston: Allyn & Bacon, 1996), p. 177.

185. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 30.

186. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 95. These pages contain the most explicit attempted rebuttal of the MIM line that exists, and before MIM wrote its own MT#1 but after distribution of Sakai, Edwards and xerox MT on the subject.

187. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), pp. 346-7.

188. 11 percent of the income of those in the $1 to $20,000 category is capitalist income. 7 percent of the income in the $20,000 to $50,000 category is from capitalist income. The under $20,000 category alone accounts for more than 50 percent of all people, so the average of this group is closer to 11 than 7, but we split the difference at 9 anyway to humor our critics generously given that this is admittedly a complex calculation. Dennis Gilbert and Joseph A. Kahl, The American Class Structure: A New Synthesis, 4th ed., (Belmont, California: Wadsworth Publishing Company, 1993), pp. 92-4. (.80) share of income pie times (.09) percent of income of bottom 94% that is capitalist= (.072) share of total income pie that is capitalist income going to the bottom 94 percent.

189. The top one percent of about 90 million households made an average of $429,813 each in 1985. Splitting the difference between an estimate of 37 percent for the lower strata ($500,000 to $1 million) and 52 percent for the upper strata ($1 million plus), we estimate that 45 percent of that income came from capitalist income. (900,000 households)x(429,813)x(.45)=$174.1 billion = the capitalist share of property income. Dennis Gilbert and Joseph A. Kahl, The American Class Structure: A New Synthesis, 4th ed., (Belmont, California: Wadsworth Publishing Company, 1993), pp. 86-105.

Now if instead of following Perlo's logic we follow MIM further and count superprofits in the salaries of these capitalists, we can see what that adds up to. The idea of "excess compensation" or "profits of control" is really an idea agreeable to MIM, contrary to the usual dogma opposing MIM that workers only get the value of their labor-power and never more than the value of their labor or they would not be hired. Those who admit that some workers get paid more than their labor have already gone a long way toward MIM, so here we check on just the capitalists and the excessive pay they receive as employees.

If we left these households with $42,981 a year to live on or 10 percent of their income by taking away their capitalist income and excessive employment and other compensation, we would only come up with less than $350 billion a year. That means if $350 billion a year are due to racism and national oppression, then the capitalist class is living off of just racism and national oppression. However, strictly speaking, if Perlo had broken down property income to see who it had gone to, he would have concluded that he already explained the capitalist class's income as property-holders by his figure for racism and profits abroad, which was $246 billion. In fact, using Perlo's figure for racism and foreign profits, we still have over $70 billion a year to throw into overpaying workers, and as we make clear, Perlo by no means exhausted all calculations of the means by which a transfer of value to imperialism occurs from abroad.

190. Statistical Abstract of the United States, 1996, p. 784.

191. Statistical Abstract of the United States, 1996, p. 407.

192. Statistical Abstract of the United States, 1996, p. 398.

193. Lenin made it very clear that he regarded hundreds of millions in the oppressed nations to be exploited by the imperialist countries, and according to Lenin, they had "no rights," and were handled by force, not negotiated with in a "free market." See for example, what Lenin wanted to add into the party program in 1917. "Revision of the Party Programme," Collected Works, Vol. 26, p. 168.

"A privileged upper stratum of the proletariat in the imperialist countries lives partly at the expense of hundreds of millions in the uncivilized nations." V. I. Lenin, "Imperialism and the Split in Socialism," Collected Works, 45 Volumes, (Moscow: Progress Publishers, 1963-1970), Vol. 23, p. 107.

"England, France, the United States and Germany--have developed monopoly to vast proportions, they obtain superprofits running into hundreds, if not thousands, of millions, they 'ride on the backs' of hundreds and hundreds of millions of people in other countries and (economically--Ed.) fight among themselves for the division of the particularly easy spoils." V.I. Lenin, "Imperialism and the Split in Socialism," Collected Works, 45 Volumes, (Moscow: Progress Publishers, 1963-1970), Vol. 23, p. 115.

"...the brute force required to ensure 'peaceful' rule in the colonies, for example, can hardly be called peaceful. Peace reigned in Europe, but this was because domination over hundreds of millions of people in the colonies by the European nations was sustained only through constant, incessant, interminable wars, which we Europeans do not regard as wars at all, since all too often they resembled, not wars, but brutal massacres, the wholesale slaughter of unarmed peoples." V.I. Lenin, "War and Revolution," 1917, Collected Works, 45 Volumes, (Moscow: Progress Publishers, 1963-1970), Vol. 24, pp. 400-401.

Lenin also sums up the quotes he found in Marx on the subject of the labor aristocracy in his encyclopedia entry called "Karl Marx," published in 1915.

194. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 70.

195. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 477.

196. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 400. China's rapid growth most confounds statisitcians as does its government's setting of exchange-rates. For this reason, Wood found estimates of Chinese manufacturing at 106.37 million in 1985, which is much higher than what UNIDO found, but probably more accurate.

197. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 13. Wood also concludes that "the number of hours of labour embodied in a dollar's worth of manufactured imports from the South is much greater than the number of hours that would be embodied in a dollar's worth of output of the same items in the North, and it would be wrong to use the latter as an estimate of the former." Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 123. This same observation is why the exports to China do not offset the imports from China into the imperialist countries, when it comes to transfer of value.

198. Statistical Abstract of the United States 1996, p. 801. 199. Judging from U.S. Government numbers, this estimate is too high, because all exports combined for 1991 only account for 1.7 million jobs directly and another 1.7 million jobs indirectly in manufacturing exports of $314.1 billion direct exports or $546.9 billion total direct and export-related production in manufacturing. (Statistical Abstract of the United States, 1996, p. 746.) Thus, $80 billion in exports from the United $tates could easily mean less than half a million worker-years, which reflects the parasitic white-collar "work" and trade margins added into costs in the U.$. export sector. It raises the question why the Third World does not produce everything itself, which we will answer later.

200. This is a combination of statistics, first the 50 cents an hour from the Financial Times already cited for Chinese workers in manufacturing. Secondly we use a proportion of wages to value-added derived from profitability figures for 1994 in United Nations Industrial Development Organization (UNIDO), Industrial Development: Global Report 1996 (Oxford, ENGLAND: Oxford University Press, 1996), p. 148. An older figure from 1985, would show wages just over 1 in 7 dollars of value-added, (UNIDO, International Yearbook of Industrial Statistics, 1995, p. 193) which would reduce the estimate of value transferred to about 12 million Chinese-worker years. The same page 148 of 1996 UNIDO data for 1994 offers other means of calculating the value transfer to imperialist countries. With exports over $80 billion and an industrial production value-added of under $240, billion, one might decide that one-third of the 61.9 million workers employed would be more appropriate. That would mean a transfer of 20.6 million Chinese industrial worker-years of value to imperialism. In 1995, the United $tates imported $45.6 billion in Chinese goods, (Statistical Abstract of the United States 1996, p. 800) which should the be thought of as a transfer of value of at least 10 million Chinese industrial worker-years for free.

We should point out in our China calculations, we left out the question of inputs used in production and where they are from and what workers produced them. To the extent that they come from other agricultural, mining or industrial sectors in China, there is no point in changing anything to estimate value transfers. To the extent that inputs in industrial production come from the imperialist countries, we should cut down our estimate of Chinese labor-years transferred to imperialism. If all OECD exports to China actually went right back into China's industrial production as inputs for export (not very likely), then by using 1994 figures, we would have under $50 billion used in Chinese production from imperialist sources. (See Statistical Abstract of the United States 1996, p. 854.) Then we would be talking about a transfer of only about 6 million Chinese industrial worker-years per year to the imperialist countries. We are not going to estimate how much China imports its inputs for export production, because we believe we have underestimated the transfer of value in other regards.

201. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 396.

202. Trevor Rayne, "Squeezed to Breaking Point: Work, Exploitation and Profits," Fight Racism! Fight Imperialism! August/September, 1996 (London: Revolutionary Communist Group), p. 11.

203. Revolutionary Communist Group, Fight Racism! Fight Imperialism! June/July, 1997 (London: Revolutionary Communist Group), p. 8.

204. Paul A. Samuelson, Economics 9th ed. (NY: McGraw-Hill Book Company, 1973), pp. 586-7.

205. Assar Lindbeck blames the problem on younger economists who seem more interested in technique than substance, and thus do not stray far from a handful of theoretical models. The Political Economy of the New Left: An Outsider's View (NY: Harper & Row, 1971), p. 22.

Two economists, William J. Baumol and Edward N. Wolff writing with a third academic named Richard R. Nelson said, "As Veblen reminded us, we academics pursue such topics out of 'idle curiousity.'" William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 6.

206. Lenin in contrast did not consider the origins of capital a neutral question. Marx called capital "unpaid labor." Thus the capital at a worker's disposal via his or her hiring capitalist is a class issue from the beginning, and according to Lenin most of that capital (wealth) comes from the oppressed nations. (True we should admit that not all wealth is from labor since some is natural, but the quote below does not concern that matter.)

"...Britain...which has created this (its--Ed.) wealth not so much by the labour of its workers as by the exploitation of innumerable colonies.... ...it can be said without exaggeration that there is not a patch of land in the world today on which this capital has not laid its heavy hand, not a patch of land which British capital has not enmeshed by a thousand threads." V. I. Lenin, "War and Revolution," (a 1917 lecture), Collected Works, 45 Volumes, Moscow, Progress Publishers, 1963-1970, Vol. 24, page 403.

"Britain has industrialized owing to the fact that it plundered colonies for decades and centuries, gathered 'surplus' capital there, which it invested in its own industry, and thus accelerated its own industrialization. That is one method of industrialization." Stalin, Collected Works, 13 Volumes, Moscow, Foreign Languages Publishing House, Vol. 8, page 130.

"They (the American billionaires--Ed.) have converted all, even the richest countries into their tributaries. They have grabbed hundreds of billions of dollars." Lenin, "A Letter to American Workers," Moscow, Foreign Languages Publishing House, 1952.

207. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), pp. 9, 103.

208. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), p. 9.

209. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 22.

210. United Nations Industrial Development Organization (UNIDO), Industrial Development: Global Report 1996 (Oxford, ENGLAND: Oxford University Press, 1996), p. 5.

211. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 53.

212. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 137.

213. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), pp. 35, 55.

Wood is rather more concerned with whether the capital-labor ratios embodied in Third World exports are the same as they would be if those exports were produced in the First World. Wood finds some evidence that in Taiwan and Korea, they use more labor-intensive methods of production, but on the whole he continues to dismiss the idea of a difference in capital per worker as relevant to trade. He also finds that labor productivity statistics in multinational corporate subsidiaries is the same in the South as in the North, despite assumptions elsewhere contrary. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), pp. 92-3, 133.

MIM is more interested in the capital per population generally not just in the export sectors. Wood looked at similar issues, and we agree with Wood who has presented the thorough empirical evidence that imports from the South displace a (non-existent) proletariat in the North, but we are not satisfied with Wood's overall approach to commodity fetishism. Expenditures on capital and labor by a multinational corporation subsidiary in the Third World may have the same ratio as in the North, but in the case of the South, that same expenditure will result in a much higher embodiment of labor in the commodities in the case of the South. Wood is aware of this, but does not care for his purposes, except to the extent that labor-intensive industries are the first to leave the First World.

If we were to argue with Wood on Wood's own turf, we would say what drives trade is super-exploitation of labor-power, not skill differences in labor.

214. Magnus Blomstrom & Edward N. Wolff, "Multinational Corporations and Productivity Convergence in Mexico," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), pp. 266-73.

215. Wood is an interesting exception, but he is only interested in the export sectors. Even there he is only interested in the ratio of two capital-labor ratios, the North's and the South's. Since such ratios are calculated using money figures and not things per worker or even dollars of assets per worker, we have the commodity fetishism problem. As Wood knows, the same money spent on labor in the North and South buys a lot more labor in the South.

216. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), pp. 288-90.

217. Thurow believes that risk aversion is built in to investors and countries could do a better job of making risky investments than individuals can. C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 145.

218. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), p. 389.

219. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), p. 474.

220. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), p. 42.

221. http://oracle.tradecompass.com/ows-bin/oowa/ExpSrv60/dbxwdevkit/xwd_init?wrldcode/sysstart 222. Intel pulled this off against the United $tates and Japan. More than half of Intel's export income was taxed in no country. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 96.

223. Gillis et. al. pp. 304.

224. World Bank, Hoover Institute and Brookings Institute authors Jose Edgardo Campos and Hilton L. Root have admitted this too, not so much from a tax perspective, but a fear of confiscation perspective: "This uncertainty about the ruler's future behavior induces firms to be secretive. Firms know that their assets can be confiscated, so they attempt to keep them hidden. Rather than register their assets, firms hide accounts and expatriate capital to safe havens abroad." Jose Edgardo Campos and Hilton L. Root, The Key to the Asian Miracle: Making Shared Growth Credible (Washington, DC: Brookings Institute, 1996), p. 77. This is another reason we cannot take bourgeois reports of profit repatriation from the Third World as seriously as profit reports from operations within the First World.

225. Grazia Ietto-Gillies, International Production: Trends, Theories, Effects (Cambridge, ENGLAND: 1992), p. 36.

226. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 96.

227. In 1988 in the United $tates for instance, fully 30 percent of exports and 20 percent of imports involved transfer pricing, trade within one company. Other estimate are nearly twice as high. Martin Carnoy, "Whither the Nation-State?" in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 45.

228. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 22. The Clinton administration estimates transfer pricing at 40 percent of imports into the United $tates. See Chapter 7, The Economic Report of the President, 1997.

229. Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 49.

230. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 59. This is also an important page, because it explains why Shaikh and Tonak think they do not have to explain where the huge profits of the unproductive sector are. They are wrong, because while there is shuffling of profits back and forth between the productive and unproductive sectors, there must be some snapshot of the economy, some way of accounting that would show profits a certain 2 or 3 times higher than unproductive sector worker compensation. That is not going to happen in the imperialist countries. This would force Shaikh and Tonak to admit with Perlo that if the rate of exploitation is the same in the unproductive sector as the productive sector, then "s" counts profits realized for the capitalists that are turned right over to workers hired under "profits of control," which is another phrase for profits not retained by capitalists but which go to unproductive sector workers. However, the concept of "profits of control" while not unfriendly to MIM, because we have emphasized the political process of class formation, it does make a mockery of the idea of a distinct "s" and "v" for the unproductive sector. Hence, although we can concede Shaikh and Tonak this means of thinking of (s/v) for unproductive sector workers, in their hands, it quickly proves contradictory in use in the actual imperialist countries, unless Shaikh and Tonak are willing to admit the MIM analysis.

231. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p. 247.

232. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p. 248.

233. Pierre Jalee, The Third World in World Economy (NY: Monthly Review Press, 1969), p. 114.

234. Samir Amin, The Law of Value and Historical Materialism (NY: Monthly Review Press, 1978), p. 62.

235. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p.144.

236. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 227.

237. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 2.

238. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), pp. 40-2.

239. Lawrence put together his figures to see if there was any reason to believe imperialist country workers are being displaced by Third World imports. We have different reasons for making this calculation. We choose 10 percent of the unproductive sector's surplus-value as the figure for a combination of the following reasons. The trade has exploded since 1990 by growing over 50% to 1994 while U.$. value-added in manufacturing went up less than 20% in the same years. Thus, if that pace kept up another four or five years, imports from the Third World would be projected to cross 20 percent of value added anyway. Since, good prices are double value-added, that would mean imports from the Third World would be projected to be 10 percent of all good prices. We suspect Europe probably lags slightly in this regard, but in the OECD average, Japan probably made up for it, because over half its imports are now Third World.

Even if our projections are wrong, then there are two other areas to consider for keeping the figure. One is the differential (higher) rate of exploitation of Third World labor. The price of the goods imported does not reflect their potential for surplus-value realized. To return to our Swiss Army knife example, if traders buy them for $1 each from China and sell them for $2, they are getting a 100 percent mark-up. If they buy them for $8 from Switzerland but can only sell them for $10, then they are only getting a 25 percent mark-up. We think this is likely the case. The margin on trade from China and other Third World countries is probably a multiple of the margin on OECD goods imported.

Finally, there is the question of the stages of production and accounting. The main reason not to use the Lawrence figure to calculate a share of surplus-value attributable to the Third World productive sector is that inputs (raw materials used) into imperialist production are about equal to the value-added in production. Thus, the final prices include not just value-added but the price of the raw materials that went into making the goods; hence, what we really want is the ratio of the final price of imports to the final price of imperialist country manufactured goods. Making things more difficult is that we do not really know where the inputs come from either, except that they are raw agricultural supplies and other raw materials from both inside and outside the country. On the balance, though, we favored our first two arguments above as sufficent reason to use 10 percent as a conservative estimate of the total mark-up realized by the First World unproductive sector on account of Third World imports.

As in the question of net transfer of labor-years of work from a Third World country to a First World country through trade, the question of lost chances for mark-ups in the retail sector are also unequal. Yes, exports from the imperialist countries to the Third World also transfer value to the unproductive sectors in the Third World. However, because of the differential rate of exploitation allowing for less mark-up of First World goods, and judging from the purchasing power and size of the unproductive sectors (in countries where most people are still peasants and workers), there will still be a huge net transfer of surplus-value to the imperialist countries by this mechanism.

240. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 121. Here we are taking 10 percent of S* listed on page 121.

241. An advocate of the examination of terms of trade who is not naďve would be Pierre Jalee, who showed how the Third World's terms of trade worsened between 1950 and 1962 in The Pillage of the Third World (NY: Monthly Review Press, 1968), p. 45. Samir Amin also found figures that showed the Third World in 1930 obtained only 60 percent what it used to receive in 1880. However, he also argued that it could be explained partly by the increased productivity in manufacturing compared with agriculture. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p.163-4.

242. V. I. Lenin, "Immediate Tasks of the Soviet Government," in Robert Tucker ed. The Lenin Anthology (New York: W.W. Norton & Company, 1975), p. 450.

243. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), pp. 74-5.

244. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 217.

245. John W. Wright, ed. The Universal Almanac (NY: Andrews & McMeel, 1991), p. 234.

246. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), pp. 37, 220-1. There is nothing surpassing the work of the Monthly Review Press in evaluating the national question in relationship to exploitation.

247. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 35.

248. One graph demonstrating this fact appears in Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 119.

249. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), p. 9.

250. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), p. 20.

251. United Nations Industrial Development Organization (UNIDO), Industrial Development: Global Report 1996 (Oxford, ENGLAND: Oxford University Press, 1996), p. 17.

252. On the issue of the labor productivity of oppressor nations being higher, Samir Amin and Arghiri Emmanuel pointed out that Marx saw wages as the value of labor-power, and those wages were unconnected to the productivity of labor-power. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p. 145. This leaves open the question of a global wage for the reproduction of labor-power based on internationalist considerations, and not one country's capability to live in luxury at the expense of others.

Even if we grant our critics that wages should cover the costs of educating the workers, it is not a simple matter that workers in the oppressor nations pay for their own education. Aside from the brain drain from the Third World, there is the matter again of surplus-value flowing from the Third World to the first, thus making possible higher levels of education. In any case, it is far from the case that wages in the First World are the same as those for the Third World except for a little something extra to cover student loans.

253. The late Trotskyist economist and leader of the Trotskyists' organization internationally, Ernest Mandel said back in 1964 already that the decline of the Third World's relevance would mean that the advanced industrial countries were due for crisis. Pierre Jalee correctly refuted this line of argument in The Pillage of the Third World (NY: Monthly Review Press, 1968, p. vii). 33 years later we can see that there was no crisis and that the Third World has been an increasingly important source of surplus-value.

Between 1965 and 1995, the Third World share of a much larger export pie grew from 27 percent to 33 percent. "Chapter 7," Economic Report of the President, 1997.

In 1993, some put forward the Mandel thesis in the name of the "Information Age." Despite the addition of manufacturing to the Third World export repertoire, four ruling class experts put forward that the Third World is breaking up, including into a large part that is irrelevant to the world economy. To their credit, they at least argue that the majority may be integrated into the capitalist system. Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), pp. 7, 12. Although it is a university press book, it reads like a Time-Warner-HarperBusiness book.

254. Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 21. The article by Cohen argues that "cheap labor countries" are not the problem for Europe and Amerika. "The trouble is with Japan, where wage costs no longer significantly differ."(p. 146) According to Cohen, the Japanese have taken up "lean production." Their breakthrough in the organization of production is as great as the invention of the assembly line itself. (pp. 108-110) Though we are generally critical of Cohen, we should like to commend his work for the emphasis on the organization of production and also for recognizing how the view of research science as separate from production is holding back technology. Mao held a similar view of how science advances.

255. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), p. 11.

256. Assar Lindbeck, The Political Economy of the New Left: An Outsider's View (NY: Harper & Row, 1971), p. 58. A much lower estimate of human capital combined with public investment accounted for one-third of inequality within Europe. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 204.

As MIM discusses here, we are more interested in global inequality, but the inequality arising within the United $tates in the 1960s and 1970s can be traced to the growth of parasitic sectors made possible by value transfers from the Third World.

257. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), p. 56.

258. "The requirements of accumulating capital may exceed the increase of labour-power or of the number of labourers; the demand for labourers may exceed the supply, and, therefore, wages may rise. This must, indeed, ultimately be the case if the conditions supposed above continue. For since in each year more labourers are employed than in its predecessor, sooner or later a point must be reached, at which the requirements of accumulation begin to surpass the customary supply of labour, and, therefore, a rise of wages takes place." Karl Marx, Capital, Vol. I, (end of chapter VII), (Moscow: Progress Publishers, 1954), p. 575. According to Marx, it was possible for labour to become an obstacle to accumulation with its wage demands, but after a period when capital did not replenish itself and expand, wages would go down. (Ibid., p. 580)

259. "S" today is further limited in that over half the workers in the imperialist countries are unproductive and produce no "s," but we assume here that all the workers produce surplus-value. Of course then there are the children, retired and others unable to work who would also be deducted from the portion of the population that contributes to "s," so we assume that none of these people exist either. We also have granted the capitalist system the assumption that it can create "full employment," in order to grant it the most favorable conditions possible for the examination of s/(c + v) and capitalism's self-image. In other words, in looking at this situation, we have granted capitalism every possible favorable assumption for its high-tech life and still we can see its dynamics of crisis.

For a further discussion of "full employment" tendencies of capitalism, see Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), pp. 74-5.

260. Angus Maddison, "Explaining the Economic Performance of Nations," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 48.

261. Economists claim that the number of people who want to work in the developing countries increases 2 percent a year right now. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), p. 187. We suspect that on a one-time basis the labor supply for capitalism could grow much faster with the liberation of wimmin and extraction of peasants out of semi-feudalism. This possibility which communists have to organize also has the effect of extending the life of capitalism by increasing sources of surplus-value. On the other hand, the sooner the world reaches that point, the sooner it can go on to socialism.

262. Lester C. Thurow, Zero Sum Solution: An Economic and Political Agenda for the 1980s (NY: Simon & Schuster, 1985), pp. 325, 329.

263. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 254.

264. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), p. 58.

265. Angus Maddison, "Explaining the Economic Performance of Nations, 1820-1989," in Convergence of Productivity: Cross-National Studies and Historical Evidence, William J. Baumol, Richard R. Nelson and Edward N. Wolff eds. (Oxford, England: Oxford University Press, 1994), p. 47.

266. Robert Z. Lawrence, Single World: Divided Nations—International Trade and OECD Labor Markets (Paris: Brooking Institution Press, 1996), p. 13 graph.

267. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p. 166.

268. Samir Amin, Unequal Development: An Essay on the Social Formations of Peripheral Capitalism (NY: Monthly Review Press, 1976), p.167.

269. Angus Maddison, "Explaining the Economic Performance of Nations," in William J. Baumol, Richard R. Nelson & Edward N. Wolff, eds., Convergence of Productivity: Cross-National Studies and Historical Evidence (Oxford, ENGLAND: Oxford University Press, 1994), p. 48. Countless others have written about this shift from productive to unproductive labor already. Especially relevant is Harry Braverman, Labor and Monopoly Capital: The Degradation of Work in the Twentieth Century (NY: Monthly Review Press, 1974), pp. 254-5.

270. Statistical Abstract of the United States, 1996, p. 732. The 34.9 percent that is white-collar received half of manufacturing employee compensation in 1992. See page 740.

271. Statistical Abstract of the United States, 1996, p. 843.

272. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 11. Of course, this shift to manufactured goods is a step up from just exporting agricultural and other raw materials. We believe that to be a redeeming factor.

273. Victor Perlo comes up with an increasing rate of exploitation of U.$. productive sector workers, ranging from about 1.5 in 1925 to 3.02 in 1984. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 43.

274. Statistical Abstract of the United States, 1996, p. 732.

275. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 132.

276. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 88. They believe it has been proved that the rate of exploitation is the same in the two sectors, within 10 percent of each other since World War II.

277. Backing Fusfeld, the U.S. Government says that as of 1995, 79.3 percent of employment is service employment. A real nuts and bolts calculation would move transport services and public utilities which is 5.3 percent of employment over to the goods-producing sector to come up with the unproductive sector at 74.0 percent, but then by various estimates a third or a half of the goods sector would be taken out again to remove white-collar workers from the productive sector. Hence, the unproductive sector is over 80 percent, and outnumbers the productive sector by over 4:1. Statistical Abstract of the United States, 1996, p. 417.

278. Daniel R. Fusfeld, Economics: Principles of Political Economy 3rd ed. (Glenview, Illinois: Scott, Foresman and Company, 1988), pp. 526-7.

279. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 291.

280. Statistical Abstract of the United States, 1996, p. 445.

281. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), pp. 38, 106.

282. Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), (Gillis et. al. hereafter), p. 47. One problem with these figures is that they do cover the subject of growth in output counting security guards, lawyers and speculators, but they are calculated "by dividing the average share of gross domestic investment in gross domestic product by the rate of growth in gross domestic product." If we assume that investment is subject to diminishing returns, then a superior capital-output ratio of this sort could arise simply from a cutback in the fraction of investment relative to output. Thus from year to year, the effect measured by a decline in this capital-output ratio could arise because of the diminishing returns aspect or because adding $1000 in computers does much better this year than the year last measured. In the first case, the workers have computers coming out their ears and cannot do anything with them so capital-output rises because of a cutback in investment and in the second case, the workers can really use the superior computers to their fullest extent.

283. Statistical Abstract of the United States, 1996, p. 732.

284. In 1990 constant dollars, thus slightly understated relative to U.S. Government numbers. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 254.

285. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 36.

286. Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 36.

287. Lester C. Thurow, Zero Sum Solution: An Economic and Political Agenda for the 1980s (NY: Simon & Schuster, 1985), pp. 80-2.

288. Lester C. Thurow, Head to Head: The Coming Economic Battle Among Japan, Europe, and America (NY: William Morrow and Company, 1992), p. 168. Thurow, William Lazonick, Bluestone, Harris and others are closer to the classical tradition of economics of which Marx was a part which drew the distinction between the productive and unproductive sectors. They take cues from the Japanese who also run their economy as if in fear of de-industrialization. Japanese economics teaching is also much more inclined to classical thinking than neo-classical. These authors believe that to the extent the U.$. believes its own economists' propaganda about service or white-collar work, the more of a competitive disadvantage it will accumulate.

289. Martin Carnoy, "Whither the Nation-State?" in Martin Carnoy, Manuel Castells, Stephen S. Cohen, Fernando Henrique Cardoso, The New Global Economy in the Information Age: Reflections on Our Changing World (University Park, Pennsylvania: Pennsylvania State University Press, 1993), p. 63. This data is relevant to the parameters used by Adrian Wood who assumes that the profit rate, technique of production and capital availability is the same in the Third World as in the First World. Wood assumes that Third World workers are half as productive as First World workers, but here we learn that the data more backs the idea that Third World workers have half as much capital to work with per worker.

290. 80 percent of income is employee compensation. 75 percent of that goes to unproductive sector employees. That is 60 percent of income. Then (s/v) = (20% of nation income/60 percent of national income)=.33.

291. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 196.

292. http://oracle.tradecompass.com/ows-bin/oowa/ExpSrv60/dbxwdevkit/xwd_init?wrldcode/sysstart Although it makes little difference to the figures, we do not count Central and Eastern Europe as Third World. We did not manage to exclude Russia as Third World, but recently its wage levels are comparable to the Third World anyway. The ex-USSR's total exports to the world were $27.6 billion in 1994, down from $49.8 billion in 1993. In 1994, 19.3 billion of the exports went to Europe and $1.9 billion to the United $tates.

There is a large discrepancy over trade from Latin America between OECD and Trade Compass figures. We chose the more than twice as high Trade Compass figures. Apparently Trade Compass figures count Mexico as South America. Accounting for that, we reduce the discrepancy between the OECD and Trade Compass figures to about one percent. There is still some degree of discrepancy because, OECD figures show U.$. imports at $663.8 billion and Trade Compass figures show $700 billion. There are differing methods of counting freight and insurance.

The Third World trade figure total is derived from the OECD figures in the Statistical Abstract of the United States, 1996, p. 854.

293. The biggest mistake to avoid is counting consumption of fixed capital in the year as surplus-value produced, because workers would have to use up fixed capital in a socialist country too. GNP as opposed to GDP removes this problem. Another problem with some countries, but not all, is that they mix together "household profits" with other profits as if households made profits on their business, construed various ways, some quite far from the Marxist idea. On top of that is the problem of how to count the conventional petty-bourgeoisie's income and profits. One other problem is to look at "operating surplus," which is just a residual number invented out of thin-air to cover statistical discrepancies in adding up the accounts. By juggling numerous tables, one may figure out what operating surplus really is in a particular country. U.S. figures so neatly established in tabular form, Statistical Abstract of the United States, 1996, p. 448. The U.$. figures exclude foreign profits from total surplus. Actually, the non-U.$. OECD bourgeoisie exploits the U.$. workers for a few billion a year on a net basis considering outflow of property income from the United $tates. For this reason, the U.$. should be considered almost exactly a draw for this table, with no profits going to the oppressor nation capitalist-class from oppressor nation workers, and some tiny profits going to the non-OECD bourgeoisie, but not large enough to be said to be coming from the oppressor-nation workers. Figures for other imperialists are from Department for Economic and Social Information and Policy Analysis Statistics Division, United Nations, National Accounts Statistics: Main Aggregates and Detailed Tables, 1993 (NY: UN, 1996).

Belgium, p. 113. Property income disbursed and net savings.

Canada, p. 195. Property income disbursed and net savings.

Denmark, p. 291-2. Households receive negative property income in Denmark. Corporations and quasi-corporations are also non-factors in property income. The government receives three times more property income than the corporate and quasi-corporate sector. Consumption is less than worker compensation. A generous interpretation of surplus-value would be net saving for capital formation.

England, p. 1373.

France, p. 458. Households receive only one-quarter of disbursed property income, apparently because much income ends up in the hands of unincorporated private enterprises, presumably the petty-bourgeoisie, which as always causes the problem of whether to count their money as work income or property income. To get around this, for France, we offer a figure of household property income plus the capital formation of corporations and quasi-corporations, because France also offers such a breakdown in its figures. 550.2 billion French francs for households and non-profit institutions in property income is added to 222.7 billion French francs for net saving of corporations and quasi-corporations that went into capital formation=772.9 billion French francs. Alternatively, we can use a figure of 2,215.8 billion francs for property income that ends up with the government and mostly residual for private unincorporated enterprises (1,034.7 billion) francs. It seems likely to MIM that a traditional petty-bourgeoisie is receiving this latter sum equal to one-seventh of the GDP.

Germany, p. 513. We exclude quasi-corporations as petty-bourgeoisie, except for a trifling sum.

Japan, p. 757, 735-6. The nub of the problem is that corporations and quasi-corporations are viewed as borrowing money to finance capital accumulation and different accountings have never been reconciled. In 1993, it looks like non-financial corporations went into debt and liquidated assets, but financial corporations do not appear to have been able to lend the difference. Thus, it looks like government loaned corporations money. Households, government and borrowing appear to be the sources of capital accumulation, but corporations and quasi-corporations do suddenly appear as sources of fixed capital consumption. Like France, the ratio of disbursed property income to household income from property sources is almost 4:1, so where did the money go? We are going to say there is 78.1 trillion yen in net capital formation in 1993. Since net savings of households exceeded property income received, we are going to say there was no consumption of property income at the household level. In fact, consumption was almost exactly equal to employee compensation.

Switzerland, p. 1289. In Switzerland, profits from abroad appear to be counted in household income based on the fact that that household income adds up to GDP.

Sweden, p. 1267, 1243. Swedish companies disbursed more property income than they took in 1993. The government ended up receiving more of the property income than the households did. At the risk of incorrectly tripling surplus-value, we will count all the residual in the statistics as hidden property-income. Household and non-profit property income was only 74.1 billion Swedish kronor compared with 60.1 billion kronor received from profits from the rest of the world.

Netherlands, p. 930. We will double the surplus-value for this calculation, to count petty-bourgeois enterprises and humor our critics.

294. Earlier in this essay, we showed how to calculate this for the United $tates. Numerous studies have shown that the United $tates has the most unequal distribution of wealth and income in the imperialist countries, because of its total lack of social-democratic tradition. Hence, we doubt that any country in the imperialist countries exceeds 30 percent of its income going to the top 1 percent. In some cases there will be a severe divergence, such as in Japan where CEOs receive peanuts in stock and compensation compared with U.$. executives. We have set a floor of 22 percent going to the capitalist-class, even if the evidence would support a lower figure.

To obtain percentage of surplus-value appropriated by the capitalist-class of each country, we took each country as having a percentage of the U.$. inequality. For example, we estimate German inequality to be about 70 percent as bad as U.$. inequality, based on data in Angus Maddison, Monitoring the World Economy 1820-1992 (Paris: OECD, 1995), p. 52. Contradicting this evidence somewhat is the evidence for Australia in Malcolm Gillis, Dwight Perkins, Michael Roemer & Donald Snodgrass Economics of Development, 3rd ed. (New York: W.W. Norton & Co., 1992), (Gillis et. al. hereafter), p. 76. Thus, for Australia, Switzerland and New Zealand, we will use the same parameter as the United $tates. Evidence shows that English income inequality is about 60 percent as bad as U.$. inequality and improving in recent years. We are impressed by the concentration of wealth pointed to in Cockshott and Cottrell, but we also note that English capitalists seem to get away with lighter capital intensity in their operations anyway.

295. % Foreigners column is the percent of the labor force that is foreigner. Australia, Canada and the United $tates use the same idea, but the others have differing concepts of citizenship, which is why we must tread carefully. Statistical Abstract of the United States, 1996, p. 833.

Some information on internal oppressed nationalities also in John W. Wright, ed., The Universal Almanac, 1992 (NY: Andrews & McMeel, 1991).

296. These figures are from Department for Economic and Social Information and Policy Analysis Statististics Division, United Nations, National Accounts Statistics: Main Aggregates and Detailed Tables, 1993 (NY: UN, 1996).

297. A strict interpretation of the residual in Finnish accounting would see it as the income of the petty-bourgeoisie, which is neither a corporation nor an employee. That would show that the Finnish bourgeoisie does not exploit the Finnish workers, as in the other cases. That is why it is labeled in the last column as + OECD exploitation, because the outflow of income is important in Finland's case.

On the other hand, since the profits from Finland work themselves into the wages of other OECD workers, because the bourgeoisie in the other imperialists is taken care of by other means, it is also difficult to say Finland is exploited by the OECD bourgeoisie. It points more to a division between the unproductive sector petty-bourgeoisie and the workers.

In the cases of the United $tates, Switzerland, Netherlands, Luxembourg etc. it would not have mattered to the result if we thought of the bourgeoisie as trading workers with each other, and taking their net property income from abroad. Hence, to say that there is a an OECD surplus-value pool is true, but not significant politically, because the core of the imperialist world does not need it to take care of its capitalist-class. In other words, Australia, Canada, Finland and New Zealand could complain about OECD exploitation, but their money is really ending up in the pockets of other OECD workers or petty-bourgeoisie.

298. V.I. Lenin, "What Is Internationalism?" The Proletarian Revolution and the Renegade Kautsky (Peking: Foreign Language Press, 1965), p. 83.

299. Capital letters instead of italics--ed., "Preface to F. Sorge Correspondence," Collected Works, Vol. 12, p. 373.

300. V. I. Lenin, "'Left-Wing Communism,'--An Infantile Disorder," Collected Works, Vol. 31, p. 50.

301. V. I. Lenin, "'Left-Wing Communism,'--An Infantile Disorder," Collected Works, Vol. 31, p. 53. He defines the masses as proletarian and semi-proletarian, which in some readings of his work would exclude the traditional petty-bourgeoisie. He apparently does not expect comrades to go to meetings or organizations of the traditional petty-bourgeoisie or labor-aristocracy, which only brings us around right back to the original scientific question, who is proletarian and who is labor aristocracy? Without a precise analysis of the class structure, it is useless to proceed into strategic and tactical squabbles.

In any case, MIM is further anti-ultraleft than Lenin, because Lenin apparently would have agreed not to pursue the petty-bourgeoisie, but since we in the imperialist countries are often in situations where it is difficult not to be confronting a petty-bourgeois majority, we will throw aside Lenin's reservations on this and keep to the spirit of opposing sectarianism by getting out into the imperialist countries.

302. V. I. Lenin, "The Second Congress of the Communist International," Collected Works, Vol. 31, p. 231.

303. V. I. Lenin, , "Speech on the Terms of Admission into the Communist International July 30," Collected Works, Vol. 31, (Moscow: Progress Publishers, 1960), pp. 248-9.

Similar quotes how it is not just a matter of telling the leaders and purging the leaders but of aggressively telling the workers too about the labor aristocracy appear in "Letter to Sylvia Pankhurst," Collected Works, Vol. 29, p. 563: "Without the destruction of every trace of its prestige among workers, without convincing the masses of the utter bourgeois corruption of this stratum, there can be no question of a serious communist workers' movement. This applies to Britain, France, America and Germany."

304. Miles Kahler, International Institutions and the Political Economy of Integration (Washington, DC: Brookings Institution, 1995), p. 73.

305. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 262.

306. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 460.

307. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 357.

308. Chapter 7, Economic Report of the President, 1997.

309. Mao Tsetung, A Critique of Soviet Economics (NY: Monthly Review Press, 1977), p. 50.

310. Jane Degras, ed., The Communist International: 1919-1943 Documents, Vol. I (London: Frank Cass & Co., 1971), p. 78. This was adopted from Lenin's own published work of March, 1920, "Draft (or Theses) of the R.C.P.'s Reply," Collected Works, Vol. 30, p. 343. The same page of the Lenin document explains that if the comrades in Switzerland, Britain, France and the U.$.A. do not use illegal methods of work in combination with legal ones, there will be no revolutionary party. This stands as an answer to those bourgeois democrats calling on MIM to operate completely in the open.

311. The New Columbia Encyclopedia (NY: Columbia University Press, 1975), p. 568.

312. The New Columbia Encyclopedia (NY: Columbia University Press, 1975), pp. 2286-7.

313. V. I. Lenin, "The Immediate Tasks of the Soviet Government," in Robert Tucker ed. The Lenin Anthology (New York: W.W. Norton & Company, 1975), p. 449.

314. Richard Crawford, In the Era of Human Capital: The Emergency of Talent, Intelligence, and Knowledge as the Worldwide Economic Force and What It Means to Managers and Investors (None: HarperBusiness, 1991), p. 17.

315. Charles E. Hurst, Social Inequality: Forms, Causes, and Consequences, 2nd ed., (Needham Heights, Massachusetts, USA: Allyn & Bacon, 1995), pp. 149-50.

316. Karl Marx, Capital, Vol. I, (end of chapter VII), (Moscow: Progress Publishers, 1954), p. 192.

317. Karl Marx, Capital, Vol. I, (Moscow: Progress Publishers, 1954), p. 420.

318. Britain 1995: An Official Handbook (London: Central Office of Information), p. x.

319. Charles E. Hurst, Social Inequality: Forms, Causes, and Consequences, 2nd ed., (Needham Heights, Massachusetts, USA: Allyn & Bacon, 1995), pp. 152.

320. Britain 1995: An Official Handbook (London: Central Office of Information), p.30-1.

321. Britain 1995: An Official Handbook (London: Central Office of Information), p. 175.

322. W. Paul Cockshott and Allin Cottrell, Towards a New Socialism (Nottingham, ENGLAND: Spokesman, 1993), pp. 15-17. Adrian Wood also reveals data that shows workers in petroleum refining earn much higher pay than other industrial sectors. For Wood this is on account of more skill being used in petroleum refining than other industries, instead of just the fact that certain industries lend themselves to the capture of monopoly rents. Adrian Wood, North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World (Oxford, ENGLAND: Clarendon Press, 1994), p. 79.

323. W. Paul Cockshott and Allin Cottrell, Towards a New Socialism (Nottingham, ENGLAND: Spokesman, 1993), p. 18-20.

324. Trevor Rayne, "Squeezed to Breaking Point: Work, Exploitation and Profits," Fight Racism! Fight Imperialism! August/September, 1996 (London: Revolutionary Communist Group), p. 11. This organization disagrees with MIM and actually believes English workers are super-exploited: "The price of labour is pushed below the value of labour power."

325. John W. Wright, ed. The Universal Almanac (NY: Andrews & McMeel, 1991), p. 379.

326. V. I. Lenin, Imperialism, the Highest Stage of Capitalism (Peking: Foreign Language Press, 1973), p. 122.

327. V. I. Lenin, "The Tasks of Revolutionary Social Democracy in the European War," Collected Works, Vol. 18, (NY: International Publishers, 1930) reprinted in Helmut Gruber, ed., International Communism in the Era of Lenin: A Documentary History (Greenwich, CT: Fawcett Publications Inc., 1967), p. 59.

328. Richard Krooth, Arms & Empire (Harvest Books), p. 102.

329. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 498.

330. (http://www.bundesregierung.de/.bin/lay/ausland/magazines/deutschland/d960203.html, "Deutschland" No. 2 / April 1996)

331. ("Deutschland" No. 2 / April 1996) http://www.bundesregierung.de/ausland/index_e3.html

332. Anwar M. Shaikh & E. Ahmet Tonak, Measuring the Wealth of Nations: The Political Economy of National Accounts (Cambridge, ENGLAND: Cambridge University Press, 1994), p. 141.

333. Loukas Tsoukalis, The New European Economy Revisited (Oxford, ENGLAND: Oxford University Press, 1997), p. 21.

334. http://www.bundesregierung.de/.bin/lay/ausland/sectors/sect0102.html

335. http://www.bundesregierung.de/ausland/index_e3.html

336. Charles E. Hurst, Social Inequality: Forms, Causes, and Consequences, 2nd ed., (Needham Heights, Massachusetts, USA: Allyn & Bacon, 1995), pp. 152-3.

337. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 378.

338. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 363.

339. William Greider, One World Ready or Not: The Manic Logic of Global Capitalism (NY: Simon & Schuster, 1997), p. 420.

340. Heizo Takenaka, "Japan's International Agenda: Structural Adjustments," Yoichi Funabashi ed., Japan's International Agenda (NY: New York University Press, 1994), p. 174.

341. Victor Perlo, Super Profits and Crises: Modern U.S. Capitalism (NY: International Publishers, 1988), p. 383.

342. Statistical Abstract of the United States, 1996, p. 393.

343. Statistical Abstract of the United States, 1996, p. 398.