 Mae'r cyfrifio'r rhoi, ychydig, oherwydd yng Nghymru yn cael ei ddweud â'r rhoi'r classau. Roedd yn ei ddweud â'r palau economaidd, roedd yn ei ddweud â'r ddweud â'r meddwl a gweithio a gweithio. mae'r cyfathor yw'r gweithredog. Mae'n meddwl, gynllun, ffynwyr a'r gwaith. Rwy'r ffynwyr gwaith, roedd y gwaith, mae'n gweithio, mae'n gweithio, roedd y gwaith, mae'n gweithio, mae'n gweithio, roedd y gwaith, a'n gweithio. Mae'n gweithio, mae'n gweithio. Ac mae'n clywed o'r holl o'r hyn o'r gweithio. all y idea yw'r cyllid o'r tyfnol yn ysgrifennu i'w ddweud. Fy hoeddiwch, dafyn yw'r cyllid yn ystod o'r cyllid, a'i fyddwch yw'r cyllid yn ysgrifennu. Mae'n rhan o'r ddweud, a'n rhan o'n rhan o'r ddweud yn y gweithio ac yn ysgrifennu bryddoedd, ac mae'n ddweud yn gwneud yw'r prymig o'r cyllid yn ysgrifennu, When the pezzing tree, which existed in Britain, was completely wiped out, driven off the land... and we heard it into the towns and the cities where they were forced to work in order to make a living to survive. Yn yw'r capitalau, yw'r capitalau cymdeithasio cyfnodwch yma, eraill hefyd yn cael ei ddechrau'r piliadau, rhobarau, cyfnodau cyfnodau, ac yn cael eu cyfnodau cyfrannu. Mae hyn sy'n ymgyrch chi'n dweud o'r credu cyfnod ddiweddol. Of course we have these new classes as you exist and the classes brought about by capitalism are two fundamental classes. The emerging working class had no means of production, which they had previously, that was taken away from them. So they had to work for a living and the capitalist have a monopoly now over the means of production. And therefore the workers have to go cap in hand to the employers in order to get work, in order to earn a wage, in order to feed themselves and their family. It was Lenin that explained that it was one of the great services of Marx was to explain that economics wasn't simply a relationship between things, but it was a relationship between people. In other words we have to understand what lays beneath the surface, if you like, of capitalism itself, which is seen as an enormous amount of commodities and exchange and markets and so on. But what lies beneath that? That's the key question. And for Marx, his whole attempt was to rip away the mask to drag down the veil that covered the real exploitative relations under capitalism and expose the contradictions of capitalist society and to see where these contradictions were leading. Marx himself based himself first of all on the great bourgeois economists of the early 19th century of Adam Smith, David Ricardo and others. And they had a far more scientific view of economy than we have today. And so far as they came out with an idea, which was developed by Marx, called the labour theory of value. This is the real basis of Marx's economics. It's a very simple idea that in essence the value of a commodity and commodities are things which are produced for sale. If we grow potatoes and vegetables in the back garden, they're not commodities, they're things that we consume personally. The capitalists create commodities which are things to be sold for profit. And the value of a commodity, as I was explaining with these ideas, was determined by the amount of labour or labour time employed in its production, in its creation. Quite a simple idea, but based in a very material surroundings. Today, that idea is pur鋪ed. It's ridiculed. That's rubbish. It's out of date. The value of things are determined by all sorts of questions, including subjective feelings, they say. But this is not a view that we would endorse. We start on the basis of science, we have to understand it. And if things are going to be exchanged, commodities are going to be exchanged, how do they exchange, what basis are these exchanges take place? And Marx said, well, it's clearly that things are exchanged on the basis of their physical appearance, not because of their colour or their weight or anything else. There must have some, nevertheless, common property that exists for them to be allowed to be exchanged. And this common property was the fact that they were products of human labour. And as a result, you can measure human labour. So if a commodity, the value of a commodity is determined by the labour time involved in its production, that's a very sound definition of the value of a commodity. Of course, we have to understand the many objections to this by bourgeois. Oh, how can that be? Because it means that the most laziest workers will take much longer to produce something. And therefore, you're saying that this commodity would be more valuable than something else. Clearly, that's not the case. That's a silly way of looking at it. And therefore, Marx clarified it. We're not looking at just labour, but the socially necessary labour involved in the production of commodities. In other words, labour with the average technique, the average intensity, the average productivity of the time. And for instance, if you have an example of, I don't know, a manufacturer who produced cloth and over a one hour period they produced 10 yards of cloth. But then you had another manufacturer who used out-of-date machinery, very bad techniques, but they produced the cloth, not in an hour, but two hours. What does that mean, therefore, that the value of this cloth is double the amount of the previous factory owner? Of course, it doesn't. And if they take both their bales of cloth to market, clearly you've got one bale produced in one hour. And another in two hours, well, the one hours will be cheaper than the two hours. And the two hour cloth will not be sold. The market decides then. The market will reject, if you like, commodities which have not got the socially necessary labour involved in their production. So we see that the commodities, or the value of commodities are determined by labour time, the socially necessary labour time involved in their production. Commodity production as well is based upon, obviously, a means by which the capitalist can obtain profit. And this is the conundrum. Where does profit come from under capitalism? Clearly the working class has to sell something to the capitalist in order for them to be employed. They go there and Marx defined this, what did he sell? First of all, you think, well, does he sell his labour power? I mean, he or she, does he sell his labour rather, or do they sell something else? The capitalist always say, well, the worker sells his labour and he gets paid for his labour, therefore it's a done deal, everything's satisfied. But that's not exactly what happens. When the capitalist employs labour, they don't get the labour of the worker, they get the abilities of the worker they pay for. That's a very important distinction, the abilities of the worker, the labour power of a worker, the energy, the effort that the worker can give to the capitalist is bought by the capitalist. And this labour power also has a value insofar as it requires commodities, it requires a sustenance in order to replenish this labour power. Your effort, the energy you've used in one day has to be replenished and the wages you get allows you to do this so that you are fit and ready for work the next day. And that is something that the capitalist does genuinely pay the full value for. They pay the full value for the labour power, your effort, your energies that you're prepared to put in to the work. The only thing is, unlike any other commodity in the world, labour power produces more value than its own value. And of course this is where the secret of surplus value comes in, this is the secret where profit is made. Insofar as the worker themselves gets paid a wage, goes to work, say the working day is what, eight hours a day. And within a space, let's say, a secret argument of four hours, the worker produces enough values to cover their wages. Of course the worker doesn't say, OK then that's fine, I'll go home. He's got a contract to work for the eight hours, so he continues to work for an extra four hours. And it is this division of the working day which shows there's a part of the working day which covers wages, which is necessary labour. And it's a part which covers, and what is called, surplus labour, which produces surplus value for the capitalist. And that is the where profit comes from. It's through the exploitation of the working class and profit is nothing more than the unpaid labour of the working class itself. Of course the employer, the capitalist, is only a business to make money, they're only a business to make profits. And therefore their whole drive, if you like, is to maximise the surplus labour that can be squeezed out of the worker. And they can do this in two particular ways. First of all they could, if you think about it, they could extend the working day. So instead of working eight hours, they could say you must work ten hours. And the worker will produce, as normal, the four hours of value that covers their wages. But now the employer gets six hours surplus labour. So he's made a bigger extension of his profits. That's one way of doing it. And we've seen this in history. In fact I think it was mentioned in the last lecture that there is a separate chapter in capital volume one dealing with the working day. Because there's been a whole struggle of workers over the last 100 years, 150 years, over them trying to lessen the working day, reduce the hours in the working day. And in fact it was the bourgeois economists of 150 years ago were saying that's impossible because profit comes from the last hour of work. And if you reduce those hours you will reduce profits and you'll all be out of work. And that was the justification to have long working hours. But of course a worker can't work longer than what? Well it can't work longer than 24 hours a day. It's impossible. And even the state has to step in and say look let's try and keep it senior because you're squeezing workers to work 12, 14, 16 hours a day. Young children were working that 150 years ago and they were destroying them. And therefore don't let kill the goose that lays the golden egg here. Let's ensure the certain protection of the working class to a limited degree which they did through legislation. But there's another way which is obviously there's always a way around these things isn't it? How to get more profit out of the working class? Well if you can't extend the work in day over a certain amount then what you want to do is to increase the intensity of work. Increase the exploitation of work while the worker is in your employee. And the way they do this is to bring in machinery. Machinery helps to intensify the work process. I come from Dagenham. You had a big Ford in Dagenham a long time ago. And they brought in the production line. And as one comment said earlier on they reduce the skills of workers so that they can quickly produce as much as possible. And the production line and machinery being introduced was a means whereby the employer could squeeze more surplus value out of the labour of the working class. So that taking that work in day as a norm. Before it was four hours he produced enough value to cover his wages. Now with an intensified exploitation through machinery that worker could cover their wages now in say two hours. So you've reduced this amount of necessary labour to a bare minimum. And you've vastly increased the surplus labour. And that's what the capitalists are concerned about. So you can do it in two ways. One was called the absolute surplus value increasing the work in day. And the other was a relative surplus value which means squeezing more out of the working class using machinery and technique. So that they cover their wages in a less period of time and produce a greater surplus for the capitalists. And that's precisely what has happened in the last 40 years you could say. Where there's been an intensity in the workplace. Work in life has fundamentally changed compared to 40 years ago. Now it's extremely stressful. There's enormous sweated labour basically. It's taking place in factories. The terms and conditions have been ripped up. Real wages are being forced down. Another way you could increase obviously profits is to reduce the wages of workers. Because at the end of the day in relation to the economic pie. If workers get less through wages then the employers and the bosses get more in profits. It's the seesaw if you like. And exactly that has also happened in the last 30, 40 years in particular. That the slice of the national income going to labour in wages has got less and less and less. And also the proportion going to the capitalist has increased more and more. And therefore there's been an enormous intensification of exploitation of the working class throughout the western world in particular but everywhere. It's not just in Britain's everywhere. And the reason for that is they're through competition. They're desperate to squeeze the last ounce of unpaid labour from the working class itself. Of course the capitalists operate. Or they operate through personal gain. But they're also the laws of capitalism through competition which forces them to act in a certain way. That is they need to reduce costs in order to compete on a market. And they have competitors. They have other capitalists who also are looking to maximise their profits. But the only way they can maximise their profits is to undercut their competitors and sell more commodities. And this is what also happens continuously. Where each capitalist is in competition and therefore will reduce its costs by different means. They can reduce their costs by cutting the living standards of their workers. Reducing a more advanced method of machines or technique which allows them to reduce their costs. Then they're in a position where the workers, because their work is more intensified, that the value they produce is more spread over more commodities. They're producing more commodities. So the value that's gone into those commodities is spread more evenly. It reduces the cost of every individual item, of every individual commodity. And that allows them to compete with their competitors. Of course they are in a position where if they reduce costs they can undercut their competitors by reducing price. But not so far as they can reduce price. But they still make a greater profit because the productivity and the value of the commodities contain less value. So basically what they've done is they've still a march on their competitors by undercutting them by producing commodities at a lower price. The only thing is that allows them to steal extra proportion of the market and therefore they're able to get greater profits. So they make super profits by introducing the most advanced techniques into industry. The only problem is with that is that their competitors are also want to stay in business and the only way they can stay in business is also to adopt the same or similar techniques as this individual has got the best ones. So eventually or this general modern industry that's being introduced, the most advanced technique becomes generalised. So no one has an advantage then. They're all basically on the same level of playing ground until another one introduces better machines than they've got. And you have the continued process through competition of trying to reduce the value of each commodity by spreading the values as more commodities themselves as more commodities are produced by the machines that are being introduced. So this is the driving force of the capitalist itself through competition. It is true you can say that we should make an adjustment if you like. And value is not price. That's an important concept. Value itself is like the access around which price fluctuates. Price itself is determined by supply and demand which causes if there's a great demand for cabbages and the demand goes up, the supply is not as great. It forces the prices up of cabbages. Only thing is that has a knock-on effect in the rest of the economy as well because the capitalist are always looking for greater profits. And if there's a sector of the economy which is producing greater profits than themselves they have an incentive to switch production to the more profitable sector because all they're interested, they're not interested in what they produce whether it's magazines, books, shirts, footballs, anything you like. It doesn't matter. All they're interested in is making money, making profits. And if there's a sector of the economy which is making super profits because there's a scarcity of supply and demand then there will be a shift of resources from one sector to the other. They would like to get the profits. Therefore, they'll give up producing whatever it would be, footballs, and they'll start producing cabbages because cabbages are much more profitable. The only thing is when all that capital flows in and new factories are created and new farms are created to produce more cabbages then there's an excess of cabbages and therefore the price tends to fall. And therefore there's an equalisation or you have an average rate of profit existing in the economy like this because it's not a permanent thing because supply and demand creates all these inequalities and capital is immediately searching out where the maximum profit can be made in an economy itself. So you have this continual search for the maximisation of profits. But price and value are different. Value is the key nutshell, if you like. The access and the prices are affected by supply and demand. They go up and down. But they are tied to the value of a commodity. So although a value of a commodity is determined by the amount of necessary social and energy labour time involved in it, which is correct, it's valuable, it's value, the price of a commodity can fluctuate above and below this value according to the laws of supply and demand. But these are sort of surface things. It's a bit like the sea level and the different tides you get. So it goes out and the tide comes in. But now this is a sea level which is fixed. And the value of a commodity is the fixed item around which we have the fluctuation of prices. Of course, the capitalist economists just focus on price. That's all they're interested in. They don't understand value. Whereas Marxists understand you, you have to look at the real underlying fundamentals which is a value of a commodity and then you can understand price later on. Of course, this discussion about the work in day reveals where profit comes from and how the capitalists themselves are constantly looking for ways of increasing the profitability through productivity deals, just-in-time production, various ways of squeezing more labour out of the efforts of the working class itself. Marx also tried to explain more detail about capital and how capital can be divided into two different sectors. And this has the importance as we develop the argument. And he said, well, there's constant capital and there's variable capital, there's two sectors. Constant capital is things such as buildings, raw materials, machinery, which are constant in so far as when they are used up in production, they don't create new value, they just gradually transfer their own value to the new commodity. So even a machine, although it doesn't do it immediately over a period of five or ten years, gradually it will become obsolete. And after that period of time, that machine would have transferred the value of itself to the commodities that it's produced over a longer period of time. Then you've got electricity, power. All the things that go with making up a commodity in that form, constant capital, which just simply transfers its own value to the new commodities, it's constant, i.e. constant value. Variable capital is what Marx explained was wages. The capital which is spent in wages and employs labour power. And the reason why it's a variable is because this is the source by which new value is created. Machinery doesn't create it, it's labour. You can see that even by just common sense. You go to a factory, you go look at a factory, you can look at it all day, you can look at it all year. It doesn't do anything. Machinery doesn't do anything. In fact it depreciates, it rots away, it rusts. You just look at it. Only when you have the application of human labour of workers employed to work the machines, do you have real production and the development of new values. The machinery and all the other constant capital simply transfers their already existing value to new commodities. But the application of human labour power produces new values, extra value. And that's why the capitalist, that's where the profit comes from. Otherwise if the capitalist was simply paid for their labour, then what's the point in going into business? Because they know the capitalist would not make any profit. The profit has to come from somewhere. And it can't come from buying cheaply and selling more dearly because it's like swings and roundabouts. Eventually you will have to buy more dear of somewhere else. So sell cheaply, et cetera. It's just a circular motion. There's no extra value created in that particular way of doing business. It does happen, but there's no extra value created in that particular way of doing business. There's no extra value created in that particular way of doing business. You just take from Peter to pay Paul, that's all. You're just transferring the same amount of value from one hand to another. You're not creating any extra value. And the only way you can get extra value is the work employed by the working class itself in order to produce new values and commodities. Of course this is important in so far as what has the history of capitalism shown us? It's shown us that there's a greater concentration and a greater centralisation of capital. Out of every crisis is born, is destroyed the weaker sectors and the bigger powerful monopolies become even more powerful. The banks become even more greater in its power and influence. So this is the natural progress and development of capitalism is bigger machinery, bigger factories, more advanced production where workers are getting more and more excluded from production because of the productivity of labour. Instead of employing 100 workers, you won't need to. You can now employ 20 workers and they, because of the machinery and technology that's available, will produce the same amount or more than 100 workers previously. So the general thrust of capitalism is to increase constant capital at the expense of variable capital of the workers. The problem being, it's the workers who produce the surplus value. It's the workers who produce the new values. And if you're squeezing them out, then as a consequence and the consequence has been a natural tendency in capitalism for the rate of profit to decline. In other words, if you have a lot, because profit is determined by the surplus value created in relation to the total capital employed. And if the total capital employed is getting bigger and bigger and the amount of surplus value in relation is smaller then obviously you're going to have a falling or a tendency for the rate of profit to fall. And that has been a problem for capitalism since its inception. Of course, it doesn't happen. They are countervailing factors. Otherwise, it will just fall and fall and fall and fall and fall. Presumably when you reach zero, the capitalists will then will just hang themselves because they can't make any profit. They'll just give up. But that doesn't happen, of course. There are tendencies which counter influence this tendency for the rate of profit to fall, countervailing tendencies. And that comes largely through just a couple of examples. The exploitation of the working class. If you can intensify the exploitation, like we've said before, relative surplus value being created, that can increase the counteract, the falling rate of profit. And that's been happening now again. I mean, in the 1960s there had been quite a decline in the rate of profit in British industry right up actually until about 1970s. And then you had thatcherism. And with thatcherism you had a counterrevolution in the factory floor, the feet of the miners, the feet of all section of workers, and a brutal regime imposed in the factories and the workplaces. Inefficient plants, as they call it, were shut down and they concentrated in more profitable plants. But there was an almost onslaught against the working class. And because of that, the rate of profit began to rise in the late 1980s, the 1990s and in the 2000s up until 2008, there was a rise in the rate of profit because of an increased intensity and increased exploitation of the working class. Also other markets opened up in other parts of the world, in China, globalization, providing them with new outlets for their goods and so on. These acted as countervailing factors of this tendency, that's what it was called, a tendency for the rate of profit to decline itself. So there are numerous pressures and numerous contradictions in the capitalism, but the biggest contradiction of all, really, is the fact that the working class cannot buy back the full values that it produces. Because if it did, there would be no profit. The profit is an unpaid labour of the working class. So the workers as a whole cannot buy back what they produce. And that's a major contradiction, a headache for capitalism. How can capitalism survive then? If no one will buy its goods, it will collapse in a state of overproduction from the day one. But it didn't and the reason for that, that the capitalist would able to overcome this contradiction by taking the surplus produced by the working class and investing it back into machinery, back into production and creating a further market for capitalism itself through capital goods, then the workers employed in the capital goods industries would spend their money on consumer goods, which in turn would set the whole ball going again and develop the economy. So the capitalists were able to get around this problem where the workers couldn't buy back from them the full value they produced by taking the surplus and investing it to create a new market. And therefore Bob, you solved the problem. But there's a catch. And the catch is that if the capitalists are investing this surplus value into new machinery, new technique, they're producing enormous amounts of extra capacity in the economy. So they are now, their economy produces far more goods than before. And of course there comes a time, there comes a point when there's a crisis and the crisis is that of overproduction. It's never occurred anywhere in other forms of historical society. In other forms of society prior to capitalism you had a crisis of underproduction. You didn't produce enough, therefore people starved. Whereas under capitalism you have a crisis now of overproduction although let's also qualify that overproduction on the basis of private profit. It's not overproduction for the needs of society of course. People need a lot of things, houses, carpets, you name it, they need it. But they can't have access to it because they haven't got the money to buy it. So it's not the needs of society, it's the needs of, this overproduction is linked to the profitability and interests of capitalism. So they reach a point where there's an overproduction for capitalism. Capitalism in other words cannot make any more profit out of extra production because they cannot sell it. Because at the end of the day profit comes from the production of commodities that have to be sold in order to realise the value contained in them. In other words the market is just as important as the production, both are linked. And the problem of capitalism is a society ultimately which fosters an economy which produces to the maximum because each of them are competing against one another. At the same time they're cutting the market. Why? Because they're cutting costs. They want workers to work more for less wages etc etc. So they cut the market at a time where they're vastly trying to increase the output of capitalism and that reaches a crisis point and you have a crisis of overproduction. That took place in 2008, there were other ones in the past. 2008 was a classic one, World Trade collapsed, people were made unemployed, factories were closed down, factories were bankrupt, some were mothballed. You have a destruction of capital, you think about that's what happens in a crisis. The system now has produced too much and the only way it can get out of this crisis is eliminate the overproduction. So what they call creative destruction is the word the capitalist uses. In other words they have to destroy the industry, destroy the machinery in order to survive. And capitalism does this through economic crisis. It's crazy, I know, it's bedlam, but that's the only way capitalism can function. So you have idle workers facing idle factories and idle machinery. That's the definition of a capitalist crisis. However, just as the seeds of a crisis were contained in a boom, so also the seeds of recovery are contained within a slump because the slump itself does the job of destroying the excess capacity that's been created, the overproduction that's been created and therefore allows capitalism to restore a certain rate of profit because all the bankrupt indices are destroyed, all the weakest ones have gone to the wall and therefore on a new basis is the beginnings of a recovery that takes place. And this is not just the physical destruction of factories and machinery, which does occur through rusting and so on. It's real ill use, they are no good, they have to be scrapped, but also values are destroyed. I mean, if you looked at the television in 2008, they said, oh my God, the banks have reported that the shares on the stock markets have resulted in 12 trillion dollars being destroyed, et cetera, et cetera. In other words, all this value has gone up in smoke. You could say it's paper value, but it's all gone up in smoke. And therefore on the basis of this destruction, the conditions are created for a recovery of capitalism and here you have the gradual development of investment taking place because now it's more profitable to do so and with investment you take on more labour, when you take on more labour you get a greater market, you buy in different goods, you buy in different renewing your machinery, all this creates a market now and stimulates the development of capitalism itself. And that's how you have the emergence of recovery in capitalist society. Of course there's a slight thing we need to understand here, that's the theory. In the last 10 years, there should have been a recovery. There hasn't been, or the recovery has been the weakest in history. And the reason for that is that capitalism has exhausted itself. As an economic system, it's now reaching its limits. Just as capitalism and slavery went into decline and also prepared the way for a new society, so also capitalism has reached its limits in so far as it's carved up the world to begin with, it's financed monopoly capitalism on a world scale, it's imperialism, it's the highest stage it can develop to, and it's become a barrier to itself. And that's why there's no real recovery. And now there's going to be another world slump. So in other words, we've missed the real recovery and they're going for a world slump instead. And this world slump is going to be really, really deep. Even the Governor of the Bank of England said a couple of weeks ago that we're in danger because of automation and that we could return into conditions of the 19th century where the workers were not getting paid, or the share of the working class were getting paid was getting less and less. That's true. But now we're going to have a world trade war on our hands as well. Even today's paper in the Financial Times talked about China and America facing one-on-one off, and Trump has made the great ploy of demanding the Chinese within two years cut their surplus by two-thirds, which is impossible, but these are the way things are moving. On the base of a new world slump, there'll be protectionism. With protectionism, as in 1930-31, that can drive the world economy into a depression, not just a slump, a depression that can last for how long? The only reason why the depression in the 1930s ended was the Second World War. We can't have another world war because it would destroy the entire planet. Even the capitalists don't want to do that because they want to make profits. Therefore, you'll have a continual deep crisis or depression of capitalism, and in that context, that the working class's consciousness will change dramatically, and you will have revolutionary developments on a world scale. It doesn't mean to say that everything is connected to that, but if capitalism can't offer a way out, working conditions are being driven down, mass unemployment is going to take place. Those are the conditions whereby revolutionary consciousness will develop on a world scale. As happened in the 1920s and the 1930s. Economics is an important aspect. That's why Marx actually spent most of his life studying it, to go into the nuts and bolts of these laws that govern capitalism, to prepare the working class for what's coming, but to understand also the limits of the capitalist system and that it has to give way to a new form of society where private profit is done away with, and we have the planning, the rational planning of the resources of the planet in the interest of people itself, which would allow us to not have a mass unemployment, would allow us to reduce the working week, for instance, to possibly 20 hours or 10 hours. I have an enormous increase in automation, the light and the burden of work, but if it's done in a planned way, we can get the benefits of this rather than a tiny handful of people there to speculate on the lives of ordinary workers. So that's the importance of economics. That's the importance of Marx's economics, which gives us a view of what we're about to see, the contradictions which are insoluble, and the need, therefore, to understand the only way forward is the overthrow of capitalism. It's not us who will learn those lessons, but the working class itself will learn those lessons painfully by experience, by the events that will face them and prepare the way for a socialist revolution in Britain and internationally.