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Imperialism and the Law of Value
Imperialism and the Law of Value 1 John Smith2
Introduction We have yet to see a systematic theory of imperialism designed for a world in which all international relations are internal to capitalism and governed by capitalist imperatives. That, at least in part, is because a world of more or less universal capitalism [...] is a very recent development. Ellen Meiksins Wood. 3 What contribution do the 300,000 workers employed by Foxconn International in Shenzhen, China who assemble Dell’s laptops and Apple’s iPhones—and of the myriad of other ‘arm’s length’ firms in other low-wage countries producing cheap intermediate inputs and consumer goods for western markets—make to the profits of Dell & Apple, and of the service industries that provide their premises, retail their goods etc? According to mainstream economic theory, none whatsoever. According to radical and Marxist critiques of neoliberal globalisation and theories of its current crisis, none worth mentioning. Yet what Foxconn epitomises, namely the global shift of manufacturing production to low-wage countries, is neo-liberal globalisation’s cardinal transformation, expressed in a dramatic increase in the importance to firms in all sectors of the imperialist economies of super-profits extracted from southern living labour, or as Morgan Stanley economist Stephen Roach put it, the “extract[ion of] product from relatively low-wage workers in the developing world has become an increasingly urgent survival tactic for companies in the developed economies.” 4 Here is the principal driver of the vertiginous growth of the global South’s industrial
I wish to acknowledge the major contribution Andy Higginbottom has made to core theoretical concepts presented in part one of this paper, and in particular his intellectual authorship of key concepts concerning the relationship between capitalism and national oppression, and the reasons why concepts developed by Marx in Capital cannot be immediately applied to analysis of the contemporary imperialist world economy. Citations alone cannot do justice to this contribution, since much of it was rendered during our conversations over many years. 2
This paper is drawn from my PhD thesis, Imperialism & the Globalisation of Production, (completed in 2010 at Sheffield University). It can be downloaded from http://www.mediafire.com/? 5r339mnn4zmubq7. I am currently teaching at Kingston University. Comments, questions, criticism are welcome: please send them to [email protected]
Ellen Meiksins Wood,  2005, Empire of Capital. London, Verso (p127).
Stephen Roach, 2003, Outsourcing, Protectionism, and the Global Labor Arbitrage. Morgan Stanley Special Economic Study, pp5-6.
John Smith proletariat, rising from approximate parity with its counterpart in the ‘industrialised’ nations in 1980 to its current ratio of 4:1. The refusal of mainstream economists to countenance any such contribution is understandable—exploitation of labour by capital and of southern labour by northern capital is impossible according to marginalist theory rules, but the reticence of the Marxists is harder to explain. It reflects the absence of a theory of how the law of value expresses itself in today's imperialist world economy, but this absence itself needs to be explained. This absence in many cases results in an explicit or implicit acceptance of the bourgeois economists’ definition of ‘productivity’—that is, ‘valueadded’/worker—in which the low wages of Foxconn workers reflect their supposedly low productivity, even though they are working flat out with state-of-t