'The Wealth of Nations'

(Photo courtesy of the Monthly Review 10.08.09)


The Wealth of a  Nation is really the amount of commodities, in whatever form ( financial commodities such as derivatives. Labour power is also a commodity hence the emphasis on education), produced for exchange in the market within its national boundaries. The less commodities produced for the basis of exchange the poorer is the nation. Marx accurately defined it thus in Capital Vol 1. The process is Production -Circulation- Production on an expanded scale (P-C-P) or Money- Commodity- Money (with profit). The money is then used again to purchase the materials necessary to continue the production of commodities. It is the commodity that is produced during the production process that is circulated through the market for consumption. This is why the extent of production of the commodity is the most important element in wealth creation. The accumulation of capital necessary to begin the production process where money capital is used to purchase the commodity capital necessary does not belong here.  With the growth of the world market dominated by capital the wealthy nations are capable of penetrating the poorer ones with their commodities and flooding them with their products particularly when the goods cannot be absorbed within its own boundaries. The growth in the world market, dominated by capital, means that wealth becomes less a matter of national boundaries but wherever capital  can sink its claws. It is national once it is taxable by the country from which it originated. The basis for the expansion of capital outside its boundaries comes with an understanding that the nation itself was primarily responsible for the accumulation of capital through the exploitation of wage labour which generates surplus value for the capitalist.This accumulation of capital and with it the expanded scale of production allows for this movement beyond the national shores. With the accumulation of capital the constant/fixed capital increases tremendously i.e. technology/machinery takes over the work of the variable element represented by wages. Workers are constantly dismissed and form the relative surplus population as improvements in the mode of production makes workers redundant although there is an absolute increase in the amount employed regardless of the relative decline. The absolute increase is on the basis of the expansion of a particular capitalist enterprise. An absolute increase is also determined by the growth in population numbers however the proportion of the fixed capital to the amount of workers increases. One worker, with the aid of machinery, will eventually be able to do the work that 20 men did before.If capital wishes to increase beyond the average rate of profit it must find new markets to exploit or set up shop in countries where the variable element is abundant and cheap  thereby exploiting the market at home more efficiently by selling the products at a cheaper price.    National relics are regularly swept aside in favour of improving commerce with wealthier nations. Poorer countries increasingly fall within the sphere of circulation as their imports exceed their exports. It is difficult for them to compete with advanced capitalism because most of them rely primarily on a semi industrial foundation which struggles with the more archaic modes of production such as the petty commodity producer associated with the peasantry or small farming communities. Gutter nations watch in horror as their archaic modes of production disintegrate as the capital of the wealthy nation pumps out the commodities and floods its shores. With the deluge on the market an acculturation process takes place whereby the wealthy nation is elevated to a high standing within the international community. This acculturation process gets underway as a result of the extent of production of the wealthy nation. This acculturation process brings with it monetary values as that wealthy nation becomes increasingly relevant as a trading partner for the other countries even those that are relatively wealthy. This monetary value brings with it the rise of the moneyed/financial class that dictates how this money flows in and out of the various companies that provide the commodities. The growth of industrial capital brings with it the growth in the services industry that appropriates the revenues of the productive classes. The dominant service providers are financial services and those petty bourgeois classes that are primarily responsible for the circulation of the commodities produced within the national boundaries of the wealthy nations. Even if a company is located overseas the basis for its wealth is still coloured by its national character. The monetary values extend to the poor, gutter nations that pride themselves on receiving the currency of the wealthier nation (s). The poorer nation is also delighted when a company from the rich nation decides to invest in its territory. This investment by that company will perhaps offset an  increase of productivity on the part of the variable element within the gutter nation and so educate the populace on the technical requirements to carry out the enterprise and so offset a boom in production.

The Wealthy nations of the world increasingly become world leaders because the  capital accumulated becomes a lever for the dominance of poorer nations that are unable to out produce their advanced counter parts. Only those poor nations that can make that sacrifice and take on the challenge of being world beaters in the production of commodities will join the  ranks of the elite. It is an international hierarchy  The advances in technology and research become important in the increase of capital accumulation and become basic requirements for being considered a wealthy nation. This is based on a standard already set by the production of commodities in the wealthy nations already in existence.