CAPITAL vs LABOR

rffrydr · Posted: Tue Jan 17, 2006 1:22 pm Post subject: CAPITAL vs LABOR

Of course this the oldest and fundamental cyle when it comes to econmics--and it precisely because of this that the answers to questions of it's twists and turns cannot fully or finally be answered within its confines.

The ultimate direction will come, I think, from the greater worLd of politics and culture. While, doubtless, there are times when economics has held both within it's grip, i.e. the rise of japan in the 70's or, say, the french love of "hollyvooood." Ultimately, culture will decide.

Presently, in regards to the latest newsletter, we have the GM Chairman and his open "letter" to america. This may be dismissed as a Chrysler-like appeal for Washington to bail GM's fast ailing ass out (I, incidently bought their bonds a few weeks back) but it is framed in cultural terms, what we want as a society and how those values will (or can) be expressed our society's companies.

I would agree with you, Henry, that the american autos mark an ending in the cycle of cap vs labor. But I would say just the opposite. The Unions have been running GM for a long time: production has been set for at least these last years on employment balance rather to any regard for efficiency or profitability. GM and the american autos represent union power in its deaththroes. GM, for instance, allows for smoking on assembly lines and "ghost-workers." For christ's sake! the same company responsible for these guy's long-term (spiraling) health care!! The notion of an "economy" of the american auto has long-since collapsed under the weight of its own bloated worker. No amount of "offshore outsourcing" will save the Corvette (unlike the "american flyer" red wagon), captial and labor are bound by time, geography and scale. All things that "market-economies" don't handle well, if at all.

But yes, the cycle is turning, it is turning back in the direction of labor and it is turning exactly at the lowest rung in labor, where you would expect it to begin. The pinnacle of captial power is not GM but WalMart/Microsoft. The change is well underway. You mention the movies, the PR (Walmart now HAS to sponsor NPR, Katrina etc) on our side. But labor is reasserting itself where it wasn't supposed to exist: China.

Walmart doesn't site new manufacturing in coastal china anymore: good help is hard to find and even the assemblylines are not only not cheap anymore; they are beginning to cost. Agricultural reform, ironically price liberalization, is keeping more peasants on the farm and off the streets in Gunangzhou.

The first hint of this change was there for those who wanted to look 5 years ago when the 1billion plus dreamt cellphone distribution topped out at 250 million and China Mobile, the "darling" of "class A" shares went flatline. China now, as always, is bifurcated place, a land of those who can and those who will never be allowed to try. Those chinese who can make it work, make China the factory to the world, are in shorter supply than we imagine, and it's now becoming clear that limits are being pressed and costs going higher.

"Environmentalism" has come late and come by necessity in china. But it is now becoming a badge of western standards--a cultural marker. The proof is in the money: they are now hiring Vancouver companies to clean their water, for example. The most powerful symbol of all now driving China, the 2008 Olympics, is really all about acceptence, admittance, as western power--albeit a la japan! Can the transformation of labor from the country writing the greatest transformation of labor in the modern world be far behind?

It was in the concept of "shareholder" that chinese communism and western capitalism were united. Is there a more "communist" idea than this??? As capital has now found its resurgent power through this concept it has also, I think we are beginning to see, opened the door to its complement and opposite, labor.

And what of the "market," the ultimate driver of this capital investment. It takes more than a belief to fully exploit the labor/capital dynamic. It takes a complete infrastructure, all the little things that we in thw west now take for granted: the ability and right of transfer for real property, stable and fair legal framework for righting economic wrongs, a neighbor who wnats what you understand he wants etc. etc. etc. IN RE: Sachs vs. Soviet Empire

Take advertising (please!), the mother's milk of captialism, how much can you sell to those who can't read or write, what does "deoderant and tampons" mean to household without hot water?

It hasn't taken long for a generation of "little emporers" to appear in China. How much longer for a "fair and decent living."? Having a lot of poeple doesn't necessarily mean having and endless supply of labor. A means of production matching the modern needs of consumption I think will be self-limiting. --And come sooner than labor.

The pinacle for Capital in this cycle may have been marked by Microsoft and Yahoo selling out its represented western value of "free spreech" opening the door to cold Chinese cellblock for a few of its "customers." The reaction is already here (rembering Dow 1968-1982).

Next up: ROBOTS.
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rffrydr · Posted: Mon Dec 22, 2008 11:34 pm Post subject:

Unions sue CA Governor over furloughs--the sacrifice is just too much:

http://www.latimes.com/news/local/la-me-budget23-2008dec23,0,6770801.story
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rffrydr · Posted: Mon Dec 22, 2008 9:04 am Post subject:

After dismissing GM as old-timey and driving off into their own Wall St. sunset--Barron's is back, taking a second look in this decidedly old time analysis.

http://www.tickerforum.org/cgi-ticker/akcs-www?post=75995
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rffrydr · Posted: Mon Dec 08, 2008 7:30 pm Post subject:

The battlelines are forming. History doesn't repeat, it rhymes (Mark Twain):

http://www.nytimes.com/2008/12/09/us/09chicago.html?_r=1&hp
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rffrydr · Posted: Thu Oct 02, 2008 11:53 am Post subject:

The Madman and self-described hedge-fund wizard has some choice words for his market-mavens:

rffrydr · Posted: Sun Sep 28, 2008 8:09 am Post subject:

Banks shamelessly standing infront of "CreditCard Bill of Rights":

"The timing of all this couldn't be more glaring," said Bill Hardekopf, chief exec of LowCards.com, a website that tracks credit card rates and trends. "While banks say they would be tanking without taxpayer money, here comes a bill that would help taxpayers, and the banks say it isn't right.

"I'm amazed that there's not more humility at a time like this."

Humility? The banking industry couldn't have been bolder in its opposition to the House bill. Within minutes of the 312-112 vote approving the legislation, American Bankers Assn. President Edward Yingling issued a statement denouncing the move.

http://www.latimes.com/business/la-fi-lazarus28-2008sep28,0,3890727.column
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rffrydr · Posted: Sat Sep 27, 2008 7:09 pm Post subject:

A grand cycle....holding the promise of return:

rffrydr · Posted: Thu Sep 25, 2008 8:15 am Post subject:

Demos balk at bailout of golden parachutes....A "radical" idea:

http://www.workforce.com/section/00/article/25/77/70.php

The "Clawback" provisions maybe the last swipe of this great bear.
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rffrydr · Posted: Mon Aug 11, 2008 9:12 pm Post subject:

The gap needs "adjusting." And of course China plays a role--the new welfare.

http://www.economist.com/finance/displaystory.cfm?story_id=11791427
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rffrydr · Posted: Thu Jun 12, 2008 10:41 am Post subject:

Some housing is alive and well.

...."No, [but] these are our current-day aristocrats and feudal leaders . . . and this is what they want."

http://www.latimes.com/news/local/la-me-mansions12-2008jun12,0,6491528.story

Interested to know how many (any) of these are actual "'mericans."
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rffrydr · Posted: Tue Apr 29, 2008 6:36 am Post subject:

In at least one area, western labor has regained its strategic value and is in postition to impose:

http://www.ft.com/cms/s/0/2fdf57be-132a-11dd-8d91-0000779fd2ac.html

In S. America and E. Europe this has been going on now for a couple years. China--maybe too, in its own quiet way. To what extent are we now "followers"?
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rffrydr · Posted: Sat Apr 12, 2008 6:56 am Post subject:

G-7 set against a greater turn:

http://www.ft.com/cms/s/0/d912a4fc-07f5-11dd-a922-0000779fd2ac.html
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rffrydr · Posted: Mon Mar 31, 2008 3:09 pm Post subject:

Muncie--"Measure of a Nation"

http://www.mercurynews.com/nationworld/ci_8758278
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rffrydr · Posted: Fri Mar 28, 2008 1:17 pm Post subject:

That is the main reason to buy GM, still a global favorite. Very Happy

I'm starting to look at its "CCC" bonds again.
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HenryTo · Posted: Fri Mar 28, 2008 12:22 pm Post subject:

Chalk up another one for "capital." The UAW is now at its smallest size since the 1930s:

http://www.bloomberg.com/apps/news?pid=20601087&sid=abyDJ1SlWRb0&refer=home

rffrydr · Posted: Thu Mar 27, 2008 7:39 am Post subject:

Just like old times: axle strike at GM finds its way to cars, which hurts. Not half as much as the pain to this month's job report.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aZGCH6cfbXwM&refer=news
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