John Keeley

trying to understand!

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The Law of Uneven Development

Political-Military competition is rooted in economic competition.

Comparative advantage is a flawed theory; absolute advantage governs world trade just as it governs domestic markets.
The key difference between national & world trade relates to labour productivity, which is determined by the level of development of the productive forces. This results in differing prices of labour power (wages).

Unequal Exchange:
If no world trade the social value (price) of commodities is determined on a national basis.
If world market fully formed, ignoring transportation costs, the price will be determined on an international basis.
Many commodities will be in between, so there can be differences between national values & international values (domestic price & price on the world market).
Countries with higher developed forces of production can sell their commodities to less developed countries (LDC’s) at prices that are above its nationally determined value but below the national value of the country with the less developed productive forces.
This is a source of super-profits.
Competition tends to force the producers of that commodity in LDC’s out of business, unless they can develop their forces of production to increase labour productivity to be able to compete, or lower wages. The latter results in mass poverty & economic migration. Imperialist exploitation & domestic class exploitation combine.
The LDC’s end up concentrating production on commodities that they have a natural, geographical advantage, e.g. oil, copper, tin, gold, tropical fruit, etc.
As these commodities are subject to speculation from finance capital of imperialist countries, their prices can be volatile, making employment conditions in these industries even more insecure & exploitative.

China:
Countries developing their productive forces above the world average will increase their labour productivity more quickly, run trade surpluses & develop their home markets. They will have a growing share of the world market. This is China.

USA (& the UK)
Countries that have developed first & are rich in productive capital cannot develop their productive forces as quickly without incurring depreciation in the investments already made. They inevitable suffer relative decline. Even more so when finance capital drives the shift of productive capital to other parts of the world with cheaper labour costs. De-industrialisation.
Hence the law of the uneven development from working for Britain & the USA now works against them.

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