 In the meantime, give us a tariff. Give us a period of time in which you will protect us from the offensive capitalists so we can get our act together. And Congress may do that. Or they may put a quota on the foreign goods. So in the automobile industry, I can't remember exactly when this was, there was a quota on Japanese cars being imported into the United States. So the Japanese manufacturers had a voluntary quota. The American president flew over there, they had an agreement in which the Japanese manufacturers put a quota on the amount of cars that they would export to the United States. And hence the price of a Japanese car was higher than what it would be otherwise. And so Detroit for a period of time was able to compete until it could get its act together so it could compete with those Japanese products. Third, there can be an appeal to national labor to cut the real wage. So it's possible that the capitalists, when they sit down with the workers supported by the state and the media may say look, in order for us to compete, you have to cut your real wage. Cut the real wage part of V. So cut the V. So this is an appeal to domestic labor, I should have put that in, domestic labor to cut their real wage to reduce the V so we can compete on the international market. So it's not just a search the world for cheap sea and perhaps put plants someplace else but to appeal to domestic labor to decrease their real wage. What else? Well, all of these things may be working. It still may not be sufficient. It's possible that the struggle, the competitive struggle could turn to war. War amongst the capitalists. In other words, the very struggle of a super profit becomes so intense and so much is at stake in this that it's possible that war will be a result and so Mr. Lennon connected this struggle over super profits to the emergence of war, World War I and he tried to show that, no, he tried to show that there was an economic contribution to that war, a capitalist contribution which is that the struggle over the super profits took the form of the Germans and the French and the British struggling with one another over the survival of these industries. I'll come back to that a little bit, but that's fascinating because it shows how capitalist competition, intense capitalist competition, rivalry across these different national borders can be connected to an outbreak of a major war. Let's again remember the first part of the course. We do not want to reduce war, international conflict amongst these nations to economics and into this competition over super profit. People go to war for many, many, many different reasons, but what this is suggesting on a what Lennon is suggesting here is that there's an economic component to war then and today. That's the important lesson here. Alright, I want to just before I go on and talk about how this works out this global economy, I just want to go back and make sure that we understand the importance of a cheapening of C and V. So I just want to go back for a moment and talk about the numerator here to make sure that this is clear and again this will be a good review of what we've done here before. So I'm going to go back and I'm going to use the exact same numbers that we have been using here. I'm going to use UK Germany and France and this is again C, V and S. So I had here 4, 2, 2 8, 2, 2, 4, 2, 2. This is the W, the total value was 8, this 12 is 8, the use values 1, 2, 1. Alright, let me put in because it's useful to me the revenues, the costs and the profits. The new price was 28, 4 that was then 7, 14, 7, 6, 10, 6, 1, 4, 1. That's the problem. This new vector of profits is the problem for the British and the French in the success of the Germans. It's a redistribution of surplus. The market, the world market now redistributes surplus away from the relatively inefficient French and British to the innovating Germans. Suppose in reaction to this the British are able to cut real wages in Britain. So that's one reaction. Suppose this becomes 1. Everything else stays the same but suppose this becomes 1. This is a good review now. This then becomes 3 and you can ask yourself, okay, why? You're going to answer that for this course and for the exams that you have taken already and you will continue to take to finish the course. Why? Well, because, and I'll put it up here, the length of the work day has not changed. There's no, there's no change in absolute surplus value. There's no change in the number of laborers. By assumption I'm assuming all that's changed. The living labor has not changed. It hasn't gone down. It hasn't gone up. Okay, so same length of work day, same number of the little l is the same, the same number of people are being employed. The only change which has occurred is the division of the work day. This used to be the division, V surplus. Now the workers have been forced or they accept a lower real wage, a lower real wage, so the green, and hence the surplus grows. It grows to 3 and this becomes 1. It used to be 2 and 2, now it becomes 1 and 3. So there's a radical radical change, if you want, in the distribution of income by the productive laborers. They now get a smaller portion of that which they produce. So the use value of labor power is the same. So the capitalists are getting now, okay, they're getting that component of 4, like they did before, 2 plus 2, they're now getting 1 plus 3, but they can pay the workers less for getting the same. The rate of exploitation has increased. So what does that mean? Well that means over here, there's no change in the world price, as you can see. 8 is the same, 4, 5, there's no change here, there's no change in the quantities, so we still have 6, 7, but now the costs for the British become 5 and hence their profits now become 2. So you can see here the recovery of the British from what it was before. So before they had 1, now they have 2. They've been able to withstand the offensive action by the Germans raising the rate of exploitation in Britain. Nothing to do with now what's going on in France and Germany. That's a successful strategy to summarize this. Not only are the British workers exploited, but their exploitation rises because of this strategy in order to compensate the British capitalists for not being able to compete effectively with the Germans. That's a hell of a critique of capitalism. And how do you sell that to workers? Because what I just said is outrageous. How do you sell that to British workers? Well, in a variety of ways. The state may say to them and the media may say to them or both may say to them, look in order for us to, in order for you to keep your jobs in order for this textile industry not to go out of business, we all have to pull together. Kind of in the spirit of nationalism we all have to get together, capitalist workers and state and so forth etc. And you, your part of this will be to cut your wages and the part of the capitalist will be to innovate and so forth etc. Notice what that does. That pays absolutely no attention whatsoever to exploitation. It pays no attention whatsoever to the source of surplus and the inability of the British capitalists to maintain their surplus because of the offensive action of the Germans. Let me give you the second example now. Okay, so I want to get the same tableau on the black board so I don't want to change the numbers too dramatically. So let me go back to 2-2 and let me change this now to what it was. Alright. Suppose the, the just get rid of this here, this is 6, 4 plus 2 so I'm going back to what I had. Suppose instead of a cut in the real wages, suppose the British are successful in cheapening their C, okay? Suppose they're able to cut this to 2, okay? For example text that cotton shirts are produced with the raw material cotton and suppose somehow, and I'm going to come to the moment, somehow the British are able to get cheaper cotton from say Egypt or say from India, okay? And since cheaper cotton translates into a cheaper C. So let's do this one for the moment. So this now becomes 6 2, 4, 6. Still producing one. The only thing that's changed here is that the cotton has become cheaper. So this now is 26 of total value divided by 4. That's 6.5, okay? And so the revenues now become 6.5, 6.5, sorry 13 because there's two shirts by the Germans 6.5 and the costs then become 4 because they're able to cut their C 10, 6 and hence the new profits would be 2.5, 3 and 0.5. So again just focusing on the British. That's a recovery of the British from what it was. That is, before they took an offensive action they were being clobbered. This was one. Now they're able to recover and fight the Germans because they've been able to cheapen the C. Put that together. The British, and by extension every other country including the Germans the British have an interest in developing cheap C and V all over the world. And so Marx and Marxist after Marx when he after he died begin to focus on and analyze the global economy as one way to get cheapen C and V goods all over the world enabling those capitalist countries to survive and prosper. So let me turn to that then, that examination. Let me get this tableau away.