Web Dialogue: F.E.D.'s Dialectical Science in Relation to "Big" [for sale] Science.

Dear Readers, Below I have edited and rendered a recent web-forum dialogue between a new Discussant and I, for your consideration. Regards, Miguel [D]:  "Have you been published, peer-reviewed?" [M.D.]:  Some of my work, from before I was admitted into full Foundation membership, and merged in with the work of the entire Foundation community, has been published, by the F.E.D. Press, in volume 0 of the multi-volume treatise entitled A Dialectical Theory of Everything -- Meta-Genealogies of the Universe and of its Sub-Universes:  A Graphical Manifesto. The Foundation does not associate itself with "Big Science", and, by inclusion, with "Big Science's" "credibility-granting" institutions, for psychohistorical reasons. This takes into account the increasing public self-dis-crediting' of "Big Science", during this descendance-phase of the global capitalist system, due to the public's increasing realization of "Big Science's" increasing intellectual prostitution to the funding of the capitalist plutocracy, which can, increasingly, "buy" any "scientific" results that it wants -- force "scientific" research to reach the conclusions that this global, descendance-phase capitalist ruling class wants it to reach, whether these conclusions are scientifically valid or not. So, I'm afraid, if you want to determine the validity of our work, there are no official, ruling-class institutions for you to defer to:  you have only your own, naked reason and cognition to rely on! [D]:  "Also, what's your IQ?" [M.D.]:  Members of the Foundation secular monastic order, such as I, uphold personal vows which include abstinence from any public release of personal information.

Seldonian Dialectical Algebra Simplified.

Seldonian Dialectical Algebra Simplified.

Dear Readers,

One of my internet interlocutors recently wrote:  “. . . I can't make heads or tails out of the algebra”.

¡Here’s hoping that the simplified summary below will reveal for you here both the “heads” and the “tails” of Seldon’s sensational discovery!

Regards,

Miguel

Preliminaries.  Suppose ‘~’ stands for the operation of dialectical negation generically, and that this generic ‘~’ comes in many specific, determinate varieties, ‘~_x’, where the subscript category-variable, x, is the "determination" of the dialectical negation operation, i.e., where x specifies the variety of the negation ‘categorially’ -- as opposed to ‘¬’, standing for formal-logical negation, generically only.  

If so, by the rules of the Seldonian dialectical algebra of the _NQ dialectical arithmetic, specifically, with a and b representing qualitatively distinct “ontological” categories -- “kind of thing” categories -- then:  

a x b   =  ~_a[ b ], and, in particular: 

a x a   =  ~_a[ a ].

That is, the “times” operation, or ontological-categorial “multiplication” operation, is interpreted, in Seldonian dialectical algebra, as representing dialectical, determinate negation, of the multiplicand -- b, in our first example -- by its multiplier, a, and, also, thereby, the “time” operation as well -- as ‘time generation’, the generation of historical order-of-progression, or of the time/order-of-presentation of a step in the systematic presentation of the content of a “synchronic slice”, or “snapshot”, representing an historical present. 

In the presentation(s) / narratives below, the names of dialectical categories -- of generic categories of the Marxian dialectic -- are indicated by underscoring those names.

The arrow symbol, ‘--->’, indicates the process of historical becoming, or of a systematic shift in presentational focus, and the direction of the arrow indicates that direction of becoming / shifting.

Exponentiation is signified via the '^' sign, e.g., 3^2  =  3 "squared"  =  9.

Two different, generic dialectical interpretations of the Seldonian arithmetic/algebra are presented below, the first, ‘dyad-ic’, the second, ‘triad-ic’.

A.  Seldonian Dialectical Algebra, ‘Dyad-ic’ Interpretation.

Given:  The initial, ‘Stage 0’ category, designated as the generic dialectical “thesis” category, including the shared, implicit “connotations” of that category, assigned [‘[---]’] to the generic Seldonian ‘1st dialectical meta-number’, q₁ --  

q₁  [---]  thesis.

Stage 0:  thesis  =  thesis^1.

Stage 1:  “Square” the thesis, the result of Stage 0, with itself --

thesis^2  =  thesis^1  x  thesis^1  =   

thesis^1[ thesis^1 ]     =   

thesis[ thesis ]   =   

~_thesis[ thesis ]  =  


thesis "of" thesis  =

thesis + antithesis;  


this qualitatively heterogeneous categories-sum of two ontological categories, here described only generically, as “thesis” and/versus as “antithesis”, does not “simplify” to any single category, precisely because these two categories are mutually inhomogeneous; qualitatively different, like the proverbial “apples” + “oranges”.  

Overall, we can describe this operation, of ‘ontological multiplication’, connoting also one of 'ontological [self-]proliferation' -- of the ‘dialectical [self-]multiplication’ -- of the category [ thesis ] as operand/argument/multiplicand, by itself, by that category thesis[ ... ], again, this time as operator/function/multiplier, as a «aufheben» double-conservation of the operand, [ thesis ], including by adding that operand back in the result/function-value/product, as well as by the conservation/“containment-negation” of the thesis in the antithesis: 

t x t   =  t[ t ]   =  ~_t[ t ]  =  t + delta[ t ]   =   t  +  a.

Stage 2:  “Square” the result of Stage 1 with itself --

[thesis + antithesis]^2   =    [thesis + antithesis]  x  [thesis + antithesis]   =

[thesis + antithesis]  +  

[ [thesis x thesis ] + [thesis x antithesis] + [antithesis x thesis] + [antithesis x antithesis] ]   =

[thesis + antithesis]  +  

[ [thesis + antithesis ] + [thesis + synthesis] + [antithesis + synthesis] + 

[antithesis + second antithesis] ]  =

thesis + antithesis + thesis + antithesis + thesis + synthesis + antithesis + synthesis + antithesis +

second antithesis; 


The thesis category occurs 3 times in the foregoing heterogeneous sum of categories, the antithesis category 4 times, and the synthesis category occurs twice.  

But just a single occurrence of each unique, qualitatively distinct ontological category is sufficient; more than that is redundant.  

So that sum, after we apply to it of the rule of single occurrence sufficiency just articulated, simplifies to just four terms:

thesis + antithesis + synthesis + second antithesis.

‘Retro-renaming’ the first 3 terms to cohere with the naming of the 4th term yields:  

first thesis + first antithesis + first synthesis + second antithesis. 

Using the symbol ‘--->’ to stand for the phrase “goes to”, or for the word “becomes”, we obtain the following re-rendition of the whole story of this section --

Re-Rendered in ‘Phono-Ideo-gram-ical’ Shorthand: 

t1  =  t1^1,  --->  t1^2 = t1 + a1 = [t1 + a1]^1,  --->  [t1 + a1]^2 = t1 + a1 + s1 + a2.

Summary:  Dyadic Seldon Function,

₂|-|-|_h  =  [ t1 ]^(2^h), 

for h = 0, 1, 2.

Next Stage:  Stage 3, h = 3 -- 

₂|-|-|₃   =   [ t1 ]^(2^3)   =  

[ t1 ]^(8)   =   t1 + a1 + s1 + a2 + ps1 + ps2 + s2 + a3, 

in which “ps” stands for “partial synthesis”. 

¡If the examples above have “given you the gist” of how the Seldonian rules work, then “do the math yourself” for Stage(s) 3(+), and see what you get!

B. Seldonian Dialectical Algebra, ‘Triad-ic’ Interpretation. Given: The initial, ‘Stage 0’ category, designated as the generic dialectical “thesis” category, including the shared, implicit “connotations” of that category, assigned [ ‘[---]’ ] to the generic Seldonian ‘first dialectical meta-number’, q1 -- q1 [---] thesis. A “cool” thing about Seldon’s algebra --  q1^n   =   q1  + ... +  qn,  -- with '+ ... +', as opposed to mere '+ ... +', meaning the sum of all of the q  numbers, with every consecutive “natrual” number subscript between 1 and n [inclusive]. Stage 0:  thesis  =  thesis^1. Stage 1:  dialectical self-negation of the dialectical self-negation of the thesis,  the result of Stage 0: thesis^3 = thesis^1 × thesis^1 × thesis^1 = thesis^1[ thesis^1[ thesis^1 ] ] = thesis[ thesis[ thesis ] ] = thesis "of" [ thesis "of" thesis ] =  ~thesis[ ~thesis[ thesis ] ] =  thesis × thesis × thesis, which involves two distinct ‘associativities’, or orders of multiplicative operation, thesis × [ thesis × thesis ], versus [ thesis × thesis ] × thesis, addressed below in (1.a.) and (1.b.), respectively, to show that both converge to the same result. (1.a.) thesis^3  =  thesis × [ thesis × thesis ], = thesis × [ thesis + antithesis ], = [ thesis + antithesis ] + [ thesis × thesis ] + [ thesis × antithesis ], = [ thesis + antithesis ] + [ thesis + antithesis ] + [ antithesis + synthesis ], = thesis + antithesis + thesis + antithesis + antithesis + synthesis, which, after removing “redundant” repetitions of categories / terms, simplifies to: thesis + antithesis + synthesis. Re-Rendered in ‘Phono-Ideo-gram-ical’ Shorthand: t1 = t1^1, → t1^3 = t1 × [ t1 × t1 ] = t1 × [ t1 + a1 ] = [ t1 + a1 ] + [ t1 × t1 ] + [ t1 × a1 ] = [ t1 + a1 ] + [ t1 + a1 ] + [ a1 + s1 ] = t1 + a1 + t1 + a1 + a1 + s1 = t1 + a1 + s1. (1.b.) thesis^3 = [ thesis × thesis ] × thesis, =  [ thesis + antithesis ] × thesis, = [ thesis ] + [ thesis × thesis ] + [ antithesis × thesis ], = [ thesis ] + [ thesis + antithesis ] + [ thesis + synthesis ], = thesis + thesis + antithesis + thesis + synthesis, which, after removing “redundant” repetitions of categories / terms, simplifies to: thesis + antithesis + synthesis. Re-Rendered in ‘Phono-Ideo-gram-ical’ Shorthand: t1 = t1^1, → t1^3 = [ t1 × t1 ] × t1 = [ t1 + a1 ] × t1 = t1 + [ t1 × t1 ] + [ a1 × t1 ] = t1 + [ t1 + a1 ] + [ t1 + s1 ] = t1 + t1 + a1 + t1 + s1 = t1 + a1 + s1. Summary: Triadic Seldon Function, 3|-|-|h = [ t1 ]^(3^h), for h = 0, 1. Next Stage: Stage 2, h = 2 --  3|-|-|2   =   [ t1 ]^(3^2)   =  [ t1 ]^(9)   =  t1 + a1 + s1 + pa1 + pa2 + a2 + ps1 + ps2 + s2,  in which “pa” stands for “partial antithesis”. ¡If the examples above have “given you the gist” of how the Seldonian rules work, then “do the math yourself” for Stage(s) 2(+), and see what you get!

Web Forum Dialogue Excerpt: Summarizing the General Message of F.E.D.

Dear Readers, Below, I have, for your information, excerpted -- and edited, slightly -- one 'unit of exchange' from a recent web forum thread dialogue on F.E.D. Dialectics, in which I participated. Enjoy! Regards, Miguel [Discussant]:  “Can you please just explain in a few clear paragraphs what is your general message all about??.” [M.D.]:  I can only hope that you realize, when you ask to be told a new, big story in few paragraphs AND with clarity, that there is a contradiction in what you ask. And the F.E.D. story -- even just the parts of it that have so far been cleared, by the F.E.D. General Council, for public dissemination -- is a Big, GIGANTIC story -- a mind-rebirthing burgeoning of breakthroughs, still ongoing. But, I will do my best to do what you requested, with both brevity and clarity -- Seeking to advance several neglected crucial contents of the Marxian project, Karl Seldon discovered, in 1996, after many years of search, an arithmetic, and its algebra, that modeled Marxian Dialectic:  an arithmetic and algebra of dialectical logic. The mathematics undergirding this dialectical algebra was radically new, and yet the algebra it generated turned out to be something that was “predicted” by some of the deepest developments in modern mathematics, but which had not been much explored by mainstream mathematics: a “non-standard model of Natural Numbers arithmetic”. This algebra also turned out to be a ‘contra-Boolean algebra’: one of its key theorems is a strong negation -- one never considered before Seldon's work -- of Boole’s “fundamental law of thought”. The Seldonian fundamental theorem of dialectic «aufheben» "contains" Boole's "fundamental law of thought -- «aufheben» "contains" / "conserves" the single Right-Hand-Side term of Boole's "law" -- but also goes beyond the Boolean "law", by adding a crucial second term to it. Since Boole’s original algebra is an algebra that models formal logic, it is not so surprising that an algebra that models dialectical logic would contain a major demurrer from at least one of the most fundamental “laws” or axioms of Boolean algebra as an algebra of formal logic. But since Seldon’s algebra is, in this sense, an opposite to Boole’s algebra -- even though it is a “supplementary opposite”, not a mere “complementary opposite” to Boole’s system -- dialectical intuition [and Seldon’s algebra, applied to model this opposition between Boolean and Seldonian algebra], would suggest a synthesis of the two, and, indeed, application of the Seldonian algebra to model this opposition generates a third logical algebra, unifying the two, which is even more powerful and useful than either of its predecessors -- than either the Boolean, "thesis" system or the Seldonian "antithesis" system alone. Likewise, self-referentially applying Seldon’s dialectical arithmetic to model the “supplementary opposition” between the standard model of “Natural Numbers” arithmetic, and Seldon’s dialectical atithmetic as a non-standard model of “Natural Numbers” arithmetic, yields a potentially unlimited dialectical progression of new systems of arithmetic/algebra, starting with a synthesis of the standard "Natural Numbers" arithmetic with Seldon’s non-standard version, including, for just one example, in the seventh system so-generated, the first “non-syncopated”, fully arithmetical, fully algorithmic, fully ideographical system of “dimensional analysis”. Applying the Seldonian “non-standard” arithmetic/algebra to the known history of the cosmos as a whole, Seldon was able to derive a brief, single equation, that categorially reconstructs the known history of the cosmos, as a single, recurrent-«aufheben» “Dialectic of Nature” ["Dialectic" here in the singular, not, as with Engles's manuscript, in the plural], and to 'pre-construct' in mathematical description [i.e., to "predict"] a next major epoch of The Dialectic of Nature / History of Nature, thus constituting a "Dialectical Theory of Everything". Applying the Seldonian dialectical algebra to Marx's Capital, Seldon was able to reconstruct and illuminate the systematic order-of-presentation of that work, and summarize its contents in a compact, mnemonic dialectical formula / equation.  He was also able thereby to derive a detailed description as to the global system of "Democratic Communism", or of "Marxian Democracy", that can succeed the global capitalist system. Applying that same Seldonian dialectical algebra to describe "sub-universes" within the universal, whole-universe description of that "Dialectic of Nature" universal equation, e.g., applying the Seldonian dialectical algebra to the history of what Marx called "the social forces of production", of what Marx called "the social relations of production", of what Marx called "social formation(s)", and of what Marx called "ideology", Seldon was able to derive four compact, dialectical equations that summarized the history of these entities as well, and that also generated "predictions" -- descriptions of their future self-development. This full system of seven dialectical equations, modeling human history, past and future, Seldon named "The Psychohistorical-Dialectical Equations". Seldon, and, later, Seldon's co-researchers in Foundation Encyclopedia Dialectica [F.E.D.], which he co-founded for this purpose, have, ever since, derived increasing myriads of such dialectical models, for numerous other kinds of entities, or "eventities", as well, by focusing their dialectical modeling upon many other "sub-universal" "scales" as well. These dialectical models are to form the core definitions of "eventities" in a systematic, universal taxonomy of such "eventities" -- forming the planned contents of the Foundation's forthcoming multi-volume text, to be entitled Encyclopedia Dialectica. These dialectical models include a compact dialectical equation that defines/summarizes the contemporary "standard arithmetics", by encoding a systematic method of presentation of 'The Goedelian Dialectic', i.e., of the contemporary progression of the standard arithmetics -- N ---> W ---> Z ---> Q ---> R ---> C ---> .... It was my privilege, and my honor, to have been commissioned, by the F.E.D. General Council, to prepare the text for the public dissemination of this dialectical model, a central entry for Encyclopedia Dialectica -- http://www.dialectics.org/dialectics/Vignettes.html http://www.dialectics.org/dialectics...,17OCT2012.pdf http://www.dialectics.org/dialectics...,14FEB2013.pdf http://www.dialectics.org/dialectics..._29NOV2012.pdf http://www.dialectics.org/dialectics..._29NOV2012.pdf

SOLUTION –

 

‘Equitist Political-ECONOMIC DEMOCRACY’; 

 

BOOK:

MARX’S MISSING BLUEPRINTS

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'Psychohistorical Dialectic': Marxian Science vs. Capitalist Ideology -- Explicit Discussion of Falling Return-on-Capital Rates among Lower Layers of the Capitalist Plutocracy.

Full Title:

'Psychohistorical Dialectic':  Marxian Science vs. Capitalist Ideology -- Explicit Discussion of Falling Return-on-Capital Rates among Lower Layers of the Capitalist Plutocracy:   

Studies in the Late-Emerging Consciousness of ‘Technodepreciation’ within the Wider Ruling Class.

Commentary on Passages from the American Management Associations’ 1974 book Return On Investment --

Undialectical, capitalist perceptions of 'the Historical Dialectic of Capitalist Ascendance ---> Descendance'.

Dear Readers,

This blog-entry contains my commentary on some passages, extracted below, from a book, authored by Robert A. Peters, a graduate of the Wharton School of the University of Pennsylvania, and, as of the time of publication of this book, the comptroller of the Consumer and Technical Products Group of the Owens-Illinois Corporation, Toledo, Ohio.

This book was published by the American Management Association[AMA]s’ AMA-COM [“Committee On Management”] division.  It contains an explicit and direful discussion of a continuing secular fall in the rate of profit on industrial [“manufacturing”] capital -- as it appears in capitalist consciousness and ideology:  as capitalists see it, and compute it -- published in 1974, that is, on the eve of the explicit public visibility of the post-1968, devastating de-industrialization of the Northeast and Midwest regions of U.S. North America, that has since more than decimated so much of the family assets, the per capita income, and the percentage numbers of the U. S. industrial working class, and its formerly “middle class” standard of living.

Sectors of the U.S. Economy as Percent of U.S.-GDP, 1947-2009*.


This blog-entry is intended to deepen both our extant data, and our extant ‘dis-falsification’, or corroboration, regarding the hypothesis of the ‘techno-depreciation meta-dynamic’ fatal flaw of the capitalist system that we have advanced in this blog. 

In particular, this commentary provides both further empirical data, further elaboration and clarification, and further corroboration of the hypotheses regarding the ‘social forces of production# social relations of production’ ‘intra-duality’ of human society in general, and of capitalist society specifically, and, within the ‘‘‘social relations of production’’’ side of that primary'intra-duality' -- i.e., within its “CAPITAL-relation” side of that primary/universal human-social‘intra-duality’ -- the ‘capital as self-expanding value # capital as self-contracting value’ subordinate, secondary ‘intra-duality’ [using the doubly-slashed/doubly-negated equals sign, '#', as our sign for immanent, dialectical, internal, or “self-contradiction”, i.e., for ‘intra-duality’ /‘self-duality’].

I both hope and intend that this blog-entry will help you to incrementally advance your understanding of the causation of the content of recent Terran human history, some of which history you may have experienced personally.

Regards,

Miguel

[Peters]:  “The subject of this book is not only important -- it is vital...  American industry, collectively, is in trouble, and trends are continuing in the wrong direction.  This is not an idle cry of alarm to attract attention.  It is very real, and very frightening.  The rewards of business have been declining in relation to the investment required to produce these rewards.  We are fast approaching the critical point where prospective rewards will not justify the perpetuation of free enterprise as we know it today.” 

Commentary by M.D.  ¡Yes, you really did just read it:  this is a technical, accountancy servant of the industrial capitalist, lower/wider ruling class, bemoaning the longstandingsecular fall in the rate of profit on capital in U.S. industry, and warning that “perpetuation of free enterprise as we know it” is in dire jeopardy due to that fall in the rate of industrial capital profitability!  

Karl Marx, from at least 1857 on, with his discovery of his “law of the tendency of the rate of profit to fall” predicted that the day would come -- ~117 years after Marx predicted it, in this case -- when even capitalists and their servants would find themselves moved, based upon their experiences, to write such words!

[Peters]:  “Chart 1-1 shows that over the past 25 years not only have profits declined in relationship to the equity of shareholders, but, much more important, the return on investment earned by durable goods manufacturers has fallen even more and now can only be classified as marginal." 

“The “return on investment” shown in Chart 1-1 is calculated according to the technique described in Chapter 5 of this book; it is a very real number, directly comparable with the familiar interest rate on savings accounts, bonds, and so on.  But almost any way one puts together data involving profit or cash flow on one side, and some definition of investment on the other, the trend lines point the same way -- down! These are, of course, averages; some companies have done better, others not so well. But collectively the industrial bastion of our economic system is being seriously undermined.”

Commentary by M.D.  Capitalists do not compute the rate of profit on capital in the analytically deep and correct way that Marx did, in relation to his presently-socially-necessary-labor-time-value / surplus-value theory of the capitals-system and of its profitability-dynamics, as s’/(c + v), wherein the s’ numerator denotes the output, the net[’] surplus-value [“profit”] produced -- net of taxes, rents, interest, insurances, losses, and many other expenses -- by means of their productive use of the (c + v) denominator input.  That denominator, in turn, sums the inputs whose productive uses caused that net output.  The component c denotes the cost of the “constant capital” “invested”, e.g., of the non-surplus-value-producing means of production consumed -- the raw materials used-up in the product, and the plant and equipment, partially consumed by “wear and tear” in their productive use -- in producing the output whose successful sale yields the s’.  The v component denotes "variable capital", the wages-cost of the “labor-power” input, of the ‘power-to-labor’ also “consumed” in producing what ultimately became that s’ profit:  the cost, paid by the capitalist, of the human muscle, nerve, brain, and bodily and mental human energy input used-up in the process of producing what ultimately yields that same s’ as output.

Thus, in the Marxian analysis, the “wages bill” is part of the capital invested; is part of the capital input to the production of the s’ “profit” / “return” net output. 

Capitalist, ideological consciousness, on the contrary, tends to deny the wage-labor source of profit.  It even tends, at times, to fetishistically hold that capital, and only capital, magically -- including in the form of fixed capital plant and equipment, as well as, sometimes, in the form of mere paper titles, which directly produce no output of goods -- is the sole source and cause of profit returns, including that only dead labor [fixed capital plant and equipment, apart from the workers who “work” it] -- never living labor -- produces profit returns. 

Anyway, competition enforces that capitalists act as if such were true.

So the capitalists’ metrics for profitability are typically on the theme of something more like s’/C, whose denominator, here denoted by “Capital”, C, denotes, not c, but the source and opposite of c, of constant capital consumed, namely, C = remaining, not-yet-“circulating”, i.e., still “fixed”, Capital; ‘‘‘constant capital’’’ not-yet-consumed /- depreciated.

Capitalist profit-rate metrics tend to treat wage-labor cost as a just another mere, denigrated, “expense of doing business”, not as an investment input/cause of profit. 

[Peters]:  “In the late 1940s, business depreciated its assets over an average life of about 20 years.  In recent years, however, book depreciation rates for manufacturers of durable goods now average closer to 15 years.  The significance of this is very great. Economic obsolescence as a result of advancing technology has a much greater impact than it used to.  And the trend undoubtedly will continue, since the rate of technological progress shows no sign of leveling off.  While cash flows are being stimulated by the increased depreciation, the need to modernize is now demanding reinvestment more quickly than before.  Even with the stimulus given to cash flow by depreciation, total cash flow (profit and depreciation) in relation to investment has declined.  As a consequence, business has been forced to take on additional debt. Much of this debt has been justified under the banner of expansion, but unfortunately it has in reality resulted from industry’s inability to earn enough of a return to provide the capital needed to maintain itself in a viable state. ..."

"From the vantage point of shareholders, cash flow in relation to equity has improved slightly, and acted as a tranquilizer or mask to the aforementioned danger signals. But this is phony.  The “improvement” is exclusively the result of a sharp increase in the percentage of debt as a part of capitalization. ...  The real problem has been obscured."

"If all this isn’t enough, the persistent inflation of recent years has further aggravated matters.  Today’s profits and cash flows are being measured against yesterday’s costs of assets, which of itself tends to produce an illusion of well-being that is totally unwarranted....  In a few words:  Business desperately needs new tools, for the old ones are leading us down the primrose path.  When returns become insufficient to attract capital, economic stagnation and decay are inevitable.  There isn’t much time left to change direction.”

Commentary by M.D.  In the first paragraph of the three above, Peters begin to address the causation of the profitability predicament that he has been heralding. 

Like Veblen, in the passages commented-upon in another recent-previous blog-entry here -- http://capitalismsfundamentalflaw-wayforward.blogspot.com/2013/08/thorstein-veblens-version-of-marxs-law.html -- Peters attributes the fall in the rate of return on industrial capital that he documents most explicitly to the rising “rate of technological progress”, i.e., to what we term ‘the rising time-rate of technodepreciation’, not explicitly, here, also, to the rising “cross-section” of exposure of fixed capital plant & equipment to ‘technodepreciation’  due to something like what Marx named “the [tendentially rising] technical composition of capital” in relation to “the [tendentially rising] organic composition of capital”, and to the tendentially rising c/v ratio, or even to a rising C/v ratio, as their -- imperfect -- quantitative metric. 

Peters’s phrase in that first paragraph that reads “cash flows have been stimulated by increased depreciation” could be taken as an indirect acknowledgement of a rising ‘fixed capital composition of total capital’, if not of the ‘co-causal’ role thereof in rendering the fall in the post-WWII rate of profit, since ~1950, that he notes:  a greater proportion, and mass, of fixed capital to total capital resulting in a greater proportion, and mass, of depreciation “expense”, especially if wear-and-tear, physical depreciation costs are combined with ‘technodepreciation’, obsolescence write-offs against gross profits.  

Maybe Peters thought that this rising fixed capital composition is simply, empirically too obvious to need mentioning. 

However, a casual reader might, at this stage in Peters’ argument, attribute this “increased depreciation” to federal tax law changes that had increased the availability of “accelerated depreciation” expensing methods. 

Moreover, Peters references this “increased depreciation” in the context of rising“ top-line”/numerator cash flows from gross sales, not in the context of falling “bottom-line” net profits. 

So Peters, circa 1974, still falls short of the deeper insights into capitalist profitability-dynamics that Marx achieved circa 1857, ~117 years earlier, in the Grundrisse, although Peter’s is clearer -- or oppositely one-sided -- regarding the profitability-depressing moment of the ‘technodepreciation dynamic’ than Marx often was. 

Marx often emphasized the profit-rate-raising, denominator-impact of ‘technodepreciation’ write-offs, especially for later owners, in later accounting periods, after the earlier owner’s businesses failed due to such ‘technodepreciation’ write-offs / losses.

Marx also thus often de-emphasized the profit-rate-lowering, numerator-impact of such write-offs of ‘“morally-depreciated”’ fixed capital plant and equipment value, when subtracted from gross profits, because that equipment had been retired from production-use “prematurely -- long before its full “wear-and-tear”, ‘‘‘physical depreciation’’’ -- due to its technological, or "moral" [Marx], obsolescence. 

[Peters]:  “In summary, the conclusion is that cash flow provides a better way to get a handle on results than does reported profit.  If depreciation [M.D.:  of “fixed-capital” plant and equipment] were only of nominal influence, this entire discussion would be a tempest in a teapot.  But as business in general has become more capital-intensive,depreciation correspondingly has grown to a very large number.  In heavy industry, it is quite common for book depreciation to equal or exceed reported profits.”

Commentary by M.D.  Here is the nod, from Peters -- almost explicitly -- to the capital composition change ‘co-cause’ of the falling profitability that he has presented, and that Marx emphasized so consistently:  “If depreciation were only of nominal influence, this entire discussion would be a tempest in a teapot.  But as business in general has become more capital-intensive, depreciation correspondingly has grown to a very large number.  In heavy industry, it is quite common for book depreciation to equal or exceed reported profits.”  Note, however, that Peter’s emphasis here is on the improved management discernment of actual profitability rates that results from using cash flow in place of reported “profits” for the numerator of his proposed [profit-]Return On Capital Investment [ROI] ratio, not on the causal role of increasing fixed capital composition of total capital in creating a growing ‘‘‘shortage’’’ of net profit-"mass" and of net profit-rate -- especially "net of" technological obsolescence write-offs.

[Peters]:  “We have seen that ROIs for business in total have atrophied over the years to the point of threatening the economic viability of the free enterprise system.  If business, collectively, cannot generate a satisfactory return on its investment, our way of life is in deep trouble. And we are getting close to that point ...”

"...the deteriorating trend of performance in U. S. industry is unmistakable.  Of perhaps more significance, the absolute numbers are now becoming  alarming.  Who wants to put their money out to risk in U. S. durable goods manufacturers with returns like these?”

[Robert A. Peters, Return On Investment, American Management Associations, AMACOM division, 1974, pp. 1-5, 13, 35, 44, italic, bold, and underline emphasis added by M.D.].  

Commentary by M.D.  Again, in conclusion, Peters sounds the alarm, in dire terms for the interests of -- for the wealth of, and for the 'socio-econo-political' power of -- at the very least, the “outer”, “lower” layers of the capitalist ruling class who he is addressing in this book, from a collective human psychohistorical state expressed in written language -- expressed using words -- expressing that state, and whose utterance, and whose writing-down Marx essentially foresaw, from back over a century ago.  

Global Strategic Hypothesis:  The “innermost”, “highest” layer, the core, of the capitalist ruling class became aware of this death dynamic of the capitalist system far earlier, circa the 1880s, and began their counter-offensive, with their engineering of the 1907 'designer depression', to "argue for" their Federal Reserve Act, with their 1913 imposition of that “Federal” Reserve Act, and of their Federal Income Tax, so as to have deductions from the wages of workers to finance the suppression of industrialization / productive forces growth in the capitalist periphery, with their engineering of World War I, and their hyper-"profitable" selling of munitions to all of its sides, with the foundation that World War I laid for the industry-wasting “Military-Industrial Complex” [Eisenhower] to come, with their massive funding of their “Eugenics” ideology, and, facilitated by their engineering of the 1929+ “Global Great Depression I” 'designer depression', their world-wide imposition of Fascist, genocidal [“Eugenics”] state-capitalist totalitarian dictatorships -- under their, unified, control -- across much of Latin America, Europe, and Asia, until their agenda for global reversal of the historic growth of the human-social forces of production, and therefore also their agenda for global dictatorship, and for global, “Eugenics” multi-genocide, was interrupted, temporarily, when their erstwhile ‘servant-dictator’, Hitler, turned ‘Franken-Dictator’, and then again when Stalinism challenged their global rule, after the Hitler regimes removal by World War II...until they could finally resume that agenda, in earnest, in 1989. 






*Image source(s) [used with permission but not endorsement] --

• Economic Report of the President: 2011 Report Spreadsheet Tables, B-12. Gross domestic product (GDP) by industry, value added, in current dollars and as a percentage of GDP, 1979-2009, U.S. Government Printing Office [1] (11/25/2011)
• Economic Report of the President: 2003 Report Spreadsheet Tables, B-12. Gross domestic product by industry, 1959-2001, U.S. Government Printing Office [2] (11/25/2011)
• Value Added by Industry in Current Dollars, Quantity Indexes by Industry, and Price Indexes by Industry, 1947-1997; Value Added by Industry, Gross Output by Industry, Intermediate Inputs by Industry, and the Components of Value Added by Industry, 1987-1997, Gross-Domestic-Product-(GDP)-by-Industry Data, Bureau of Economic Analysis, U.S. Department of Commerce, [3] (11/25/2011)

• MERCHANDISE IMPORTS, EXPORTS, AND TRADE BALANCE: 1790-2006 (percent of GDP) [4] (11/27/2011)

Date:   27 November 2011
Source: Own work
Author: Jmk7

Note the precipitous fall in the share of “Total manufacturing” in total U.S.-GDP [broken/dashed blue graph line], in ‘contra-parallel’ with the rise in the GDP share of the “FIRE” sector -- Finance, Insurance, Real Estate, Rental, and Leasing [broken/dashed red graph line] -- with the rise in the GDP share of “Services” --  “Professional and Business Services” [solid red graph line] -- with the rise in the GDP share of “Educational services, health care, and social assistance [dotted green graph line], and with the rising foreign trade deficit [solid black line with dot-tics].