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“Is that to say we are against Free Trade? No, we are for Free Trade, because by Free Trade all economical laws, with their most astounding contradictions, will act upon a larger scale, upon the territory of the whole earth; and because from the uniting of all these contradictions in a single group, where they will stand face to face, will result the struggle which will itself eventuate in the emancipation of the proletariat.”

Karl Heinrich Marx · Marx-Engels Collected Works, Vol. VI, p. 290

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  • On the Role and Viability of Violence in the Social Struggle of Women In Particular and in Social Struggles In General

    On the Role and Viability of Violence in the Social Struggle of Women In Particular and in Social Struggles In General

    Essay · Political Philosophy · Dialectical Materialism

    On the Role and Viability of Violence in Women’s Social Struggle in Particular and in Social Struggles in General

    Violence, normality, and social order

    The word “violent” has a Latin etymological root (violentus) which the dictionary of the Royal Spanish Academy, in its tricentennial edition (2020 update), defines as that “which implies extraordinary force and intensity.”

    Was there violence in the demonstrations held around the world on International Women’s Day? Of course there was! Is that violence justifiable? To answer this question—which is precisely what this exposition seeks to do, and not merely in the case of feminist struggle—we must begin by saying that machismo is a phenomenon (described in broad terms very well by Friedrich Engels in The Origin of the Family, Private Property and the State) inherent in systems of political economy, that is, in economic systems in which differences in resources are sufficiently significant to give rise to irreconcilably contradictory social interests (antagonistic interests, whose conflict can only be resolved through the annihilation of one class by another—as the bourgeoisie physically annihilated the feudal class during and after the French Revolution, and as the feudal class annihilated the slaveholding class when Flavius Odoacer dragged Romulus Augustulus from power, deposed him, proclaimed himself King of Italy, and thereby put an end to the Western Roman Empire and to ancient Rome with it, the greatest empire any human eye has yet seen). This will be developed further below.

    As already stated, machismo forms part of the natural state of class societies (i.e., systems of political economy), just as racism, poverty, marginalization, exclusion, and so many other social facts do (to use Émile Durkheim’s terminology in The Rules of Sociological Method, where he argues that social phenomena must be treated as things—and calls such phenomena social facts). They are omnipresent not merely in capitalism but in every class society, so omnipresent that they form part of people’s everyday normality, and precisely because they are so deeply normalized they generally encounter little resistance… Thinking again about antiquity, Rome was not Rome because of the spears carried by its legions; it was Rome because of the ideas those legions imposed with those spears (financed through resources of various kinds, fundamentally economic ones) upon the minds of peoples, ideas that sedimented with the unstoppable passage of time. Of course, the key word in the preceding reflection is “normality.”

    · · ·

    Dynamical systems, ergodicity, and crisis

    In dynamical systems (a system should be understood as a kind of musical orchestra that not only possesses instruments and musicians, but also a concrete dynamics through which what occurs at one moment conditions what may occur later—any phenomenon with a sufficient degree of complexity can be studied in this way in Physics and in other sciences—) there are several notions that will shed light on this analysis. One of them is an invariant measure, which mathematically is a way of measuring the distribution of the possible states of a system that remains preserved under the system’s own dynamics. Put in a less formal way, although without losing the conceptual essence, if the system evolves according to a given rule, the invariant measure makes it possible to describe a statistical structure that does not change merely because the system advances through time.

    Connected with the preceding notion is ergodicity. Under the corresponding mathematical conditions, an ergodic system is not divided into dynamically independent regions of positive measure between which its trajectory cannot move; therefore, its temporal evolution may come to adequately represent the system’s global statistical properties. In colloquial terms (and only in colloquial terms), ergodicity expresses a particularly strong form of statistical unity in the dynamics: the system does not possess several dynamically relevant “worlds” that are completely separated from one another within the same description.

    Different from this, although later related to the study of critical phenomena and renormalization, is the notion of a characteristic length or scale. A characteristic scale is a magnitude that serves as a relevant reference for describing the structure of a system; for example, the characteristic length of a circle may be taken to be its radius, since once the radius is known its geometric scale can be completely reconstructed. In more complex physical systems there may appear, for example, a correlation length, expressing approximately the distance over which two regions of the system continue to display statistically related behavior. Near certain critical points this correlation length may grow enormously and, in the corresponding ideal limit, there may cease to be any privileged finite scale; it is precisely there that scale invariance and forms of self-similarity may appear, that is, situations in which certain relevant structural relations are approximately preserved when the system is observed at different scales.

    The importance of distinguishing these concepts is not merely terminological. Ergodicity concerns the dynamical and statistical structure of the system under an invariant measure; characteristic scale and correlation length belong to another conceptual family; and renormalization studies how the effective description of a system changes when the scale from which it is observed changes. The three notions may be related in the study of complex systems and critical phenomena, but they do not mean the same thing, nor can one simply be defined in terms of another.

    An ergodicity breaking, more precisely stated, does not consist in the disappearance of a characteristic length, but in the dynamics ceasing to behave as one single ergodic regime and in the appearance of dynamically separated regions, states, or sectors that can no longer be traversed in equivalent fashion by one and the same trajectory of the system. Put less formally, the system ceases to behave as if all its relevant dynamics belonged to one statistical “world” and begins to become trapped, divided, or differentiated among configurations with different dynamical histories. In this sense, and only at the level of qualitative structural correspondence that concerns us here, crises of capitalism may be conceived as breaks in the ergodicity of the preceding social regime: the ordinary reproduction of the system ceases by itself to guarantee the continuation of the same economic, political, and ideological regularities, and trajectories begin to open that had previously remained contained within the normality of the order.

    The contradictions of capitalism are multidimensional because capitalism is a complex system with multidimensional characteristics; nevertheless, its fundamental contradiction is the dissociation between production and consumption (which is the economic phenomenon that appears in the sphere of circulation as a dissociation between investment and saving, although the sphere of circulation is ultimately subordinated to the sphere of production; the essential dissociation is therefore between production and consumption—and this dissociation obeys institutional relations of distribution, i.e., distributive relations fixed prior to the production process and determined not by technical criteria but by purely political ones; here I am speaking of the distributive relation itself, not of distribution as such). The determination of society’s institutional relations of distribution prior to the production process is a brilliant discovery made by William Hickling Prescott, the father of History (history from its scientific perspective) in the United States (since he is generally regarded as that country’s first scientific historian) in his History of the Conquest of Peru, a matter subsequently developed by Marx in his celebrated research known as the Grundrisse (which should not be confused with Capital, since the former constitute the foundation of the latter and of A Contribution to the Critique of Political Economy).

    In the context of this article, the contradiction of interest is the one expressed in the fact that the capitalist system of political economy increasingly diffuses technology (which it in turn develops incessantly) and in the impact generated by this dizzying technological change that is increasingly homogeneously present in Western society (to generalize the preceding statement would not only be a gross error but also a profound lack of respect, since Africa and the Arab world suffer and the decent world suffers with them), together with other factors (fundamentally the intensification of exploitation—regardless of the form that exploitation assumes, what happened to George Floyd is one of the forms taken by exploitation, specifically its racial form—), producing ruptures in the dominant ideology, something poetically expressed as an awakening in the consciousness of peoples. In dynamical systems and Physics as well (both theoretical and applied), critical phenomena may appear associated with a slowing of the system’s dynamics; in Political Economy the two matters are intimately related, that is, the slowing of the system of political economy (expressed through economic crises) and the ideological rupture occur within the same interval of time (first the economic slowing occurs, then the break in ideological ergodicity or ideological uniformity in capitalist society or the capitalist social system).

    Thus stated, it becomes evident that economic crises (which form the core of capitalism’s systemic crises, although by no means their only relevant factor—the anatomy of civil society must be sought in its Political Economy—) may be understood, at the level of qualitative structural correspondence employed here, as breaks in the ergodicity of the preceding social regime, while the rearrangement of the shaken economic structure after the crisis (this rearrangement involves the centralization of capital—the large firms devouring the smaller ones after crises—the disappearance or absorption of productive units, modifications in relations between branches and productive scales, and other matters associated with them) presents a structure qualitatively corresponding to the logic studied in Physics through renormalization.

    Renormalization does not mean “returning the system to normality,” nor merely recovering a characteristic length that had been lost, but studying how the effective description of a system changes when the scale from which it is observed changes, and which relations continue to be relevant after that change of scale. In certain critical phenomena it is precisely the case that microscopic details cease independently to determine macroscopic behavior, while certain collective properties come to dominate the description of the system, allowing materially different systems to share the same effective large-scale structure.

    It should be remembered that self-similarity may appear in this context as the approximate preservation of certain structural relations under changes of scale. In colloquial terms (without thereby losing the conceptual essence), the image of Russian Matryoshka dolls remains useful provided that one small but important qualification is introduced: the point is not to claim that each doll is literally the same physical object as the preceding one, nor that every system is identical to itself at every scale, but rather that certain structural relations may reappear when the scale of observation changes. That is precisely the characteristic that matters here: the whole and its parts do not need to be formally identical for certain structural patterns to be preserved, transformed, or to reappear at different scales.

    Matryoshka dolls used as an intuitive representation of self-similarity and relations across scales.
    Figure 1 Matryoshka dolls as an intuitive representation of structural relations reappearing across different scales.
    · · ·

    Isomorphism, dialectics, and transformation

    It is worth saying here that, as the Soviet philosophers point out in the 1965 philosophical dictionary (which, incidentally, marked the systematic banishment of Stalinism from the academy—in particular from philosophical academia—even if not necessarily from everyday life in general), reality itself presents relations of isomorphism, with the word being used here in its philosophical-structural sense: materially different phenomena may reproduce internally organized relations that are qualitatively equivalent without thereby being formally identical objects. What matters philosophically in isomorphism, then, is the preservation of a particular structure of relations.

    In Mathematics the word “isomorphism” has a more restricted meaning: in general terms it designates a bijective correspondence that preserves the relevant structure of the type of objects being studied. When speaking specifically of Topology, the corresponding isomorphism between two topological spaces is called a homeomorphism, which is a continuous bijection whose inverse is also continuous; intuitively, two homeomorphic spaces possess the same topological structure even though they may differ completely in size, distances, angles, or other metric properties. A homotopy, for its part, is not simply another name for the preceding concept nor an immediate generalization of homeomorphism, but a continuous deformation between maps; and homotopy equivalence does constitute a weaker notion of equivalence between spaces, because it preserves more general topological properties without requiring the stronger structural identity imposed by a homeomorphism.

    This mathematical distinction does not contradict the Soviet philosophical use of isomorphism; rather, it helps clarify the different levels of the exposition. I am not claiming here that two phenomena belonging to different domains of reality are necessarily homeomorphic under some concrete mathematical map that has not been defined, but rather that qualitative structural correspondences may exist between them. Something similar may be observed even in the natural sciences when modifications in connectivity, configuration, or other relevant structural properties of a molecule alter the properties or functions available to it; structure is not an external ornament placed upon matter, but one of the concrete determinations of the form in which that matter exists and acts.

    This is equivalent to the way in which, in the Hegelian system (which should be remembered as seeking to synthesize the ancient Greeks’ studies of Nature with the studies of Thought undertaken by the classical German idealism that preceded him), Being-in-Itself (which expresses “that which is there,” Nature) is reflected and dialectically synthesized with Being-for-Itself. A dialectical synthesis (which in its most general form is expressed by the German word Aufheben, simultaneously meaning to abolish and to supersede—strictly speaking, the difference is that Aufheben occurs at the level of the homogeneous, whereas synthesis properly speaking occurs at the level of the heterogeneous; but because reality in general is a whole reflected with relative and varying precision in its parts, Aufheben is more general than synthesis) is the resolution of contradictions among the component parts of a whole (indissolubly linked by the very nature of reality) after a quantitative accumulation of contradictions inherent in the nature of the parts that make up that whole, permitting a qualitative leap of the whole that in turn entails a change in essence (what Hegel describes as the passage from the Abstract Universal to the Concrete Universal—Hegel is, incidentally, the only philosopher to date who includes the Concrete Universal within his system).

    In his Science of Logic, Hegel draws an analogy between Aufheben and Classical Mechanics (the Physics of his day), specifically with the torque of a lever. What the German philosopher’s example makes clear is that what matters to him is that, at the level of physical systems, the moments of force of a lever represent how the application of an action to a system alters its state or dynamics and generates a response conditioned by the system’s own structure; philosophically, what matters in this example is the relation among action, resistance, and transformation, not the claim that every social contradiction can formally be reduced to the mechanical equation of a lever.

    The preceding notion also manifests itself, under scientifically different determinations but with a qualitatively related structure, at very small physical scales. In Quantum Mechanics and, more generally, in Quantum Field Theory, particles are classified according to their spin and the statistics they obey into two broad families: bosons and fermions. Bosons have integer spin and obey Bose-Einstein statistics; fermions have half-integer spin and obey Fermi-Dirac statistics. Photons and the celebrated Higgs boson, for example, are bosons, while electrons and quarks are fermions (protons and neutrons are also fermions, although unlike electrons and quarks they are not elementary particles but composite structures).

    One of the most powerful ways of representing many-particle quantum systems is known as second quantization, in which states are described through occupation numbers and operators are introduced that are capable of increasing or decreasing the occupation corresponding to a given state. These operations are represented through the so-called creation and annihilation operators: a creation operator increases the occupation of the corresponding state and an annihilation operator decreases it. These operators do not belong only to the case of bosons; they appear for both bosons and fermions, although their algebraic structure differs: bosonic operators satisfy commutation relations, whereas fermionic operators satisfy anticommutation relations, a difference that mathematically expresses the different quantum statistics of the two families.

    What is philosophically relevant in the preceding process does not consist in converting second quantization into a demonstration of a social thesis, nor in claiming that a revolution is an interaction among quantum fields (which would obviously be absurd), but in observing that even at one of the most fundamental levels of the contemporary description of matter, processes of transformation are represented through relations between creation and annihilation, appearance and disappearance, occupation and vacancy of states. The particular scientific form belongs to Quantum Mechanics; the qualitative structural correspondence of interest to philosophy consists in the fact that transformation, negation, and the production of new determinations do not necessarily appear as external and mutually uncommunicating processes, but as related moments within one and the same material dynamics. Everything described above concerning creation and annihilation operators can be found developed, among other sources, in Richard Feynman’s Statistical Mechanics, published by Avalon Publishing in 1998, specifically on pages 167 and 174–175.

    What has been stated above concerning isomorphisms in the philosophical sense already defined—that is, the preservation of certain structural relations across different manifestations—is captured in two sayings of popular wisdom, specifically “You can dress a monkey in silk, but it remains a monkey” and “He who walks among honey gets some of it on him” (which is isomorphic to “He who runs with wolves learns to howl”). Yet it is captured with unequivocal precision in a popular expression belonging to a type of popular wisdom (surely even more popular) that is less elaborate, cruder (but often analytically more powerful): it is the same “thing” with a different smell. That is precisely what all economic restructurings following capitalist crises are, as are all promises of reformism coming from the governing class (the political-bureaucratic class) and from the ruling class (the owners of the great means of production, which is the type of private property Marx criticizes—never personal property, and distinguishing between the two should offer no difficulty to an intellect of middling stature or above), because crises are the only possible result (every result is a result insofar as it is the product of a process; that process is precisely the industrial cycle of the economy) of capitalism’s natural or normal behavior. This is what can occur when dizzying technological change is introduced into a society in which social classes exist and in which one of those classes produces in order to make a profit, but in order to realize that profit requires the final consumption of another social class with which it enters into contradiction (because wages and business profits have an inverse relation). Capitalist reality as a whole, like reality as a whole in general, reproduces in its parts certain structural relations that may be isomorphic in the philosophical sense defined above; what is required is to describe adequately which qualitative structure is preserved between the whole and its parts and, whenever one wishes to speak of isomorphism in the strict mathematical sense, to define explicitly the objects, relations, and transformations that preserve that structure.

    · · ·

    Technology, welfare, and political power

    The magnitude and direction of the social disruption produced by dizzying technological change within capitalism are due to the fact that it multiplies human productive forces in a nonlinear fashion (understanding this as a mathematical function, not merely as a scatter plot), and with them it also multiplies itself nonlinearly—in the sense previously defined—hence capital is accumulated labor, past labor, as can be seen in the following scatter plots (and in many others that can be found on the web without the slightest difficulty).

    Number of human genome base pairs sequenced per US dollar, 2001 to 2015.
    Figure 2Number of human genome base pairs sequenced per US dollar, 2001–2015. Source shown in the original chart: NHGRI / Our World in Data.
    Non-commercial flight distance records, 1800 to 2006.
    Figure 3Non-commercial flight distance records, 1800–2006. Source shown in the original chart: Our World in Data.
    Moore's Law: transistors per microprocessor.
    Figure 4Moore’s Law: transistors per microprocessor. Source shown in the original chart: Karl Rupp / Our World in Data.
    Computing efficiency, 1971 to 2015.
    Figure 5Computing efficiency, 1971–2015. Source shown in the original chart: Our World in Data.
    Technology adoption in United States households, 1903 to 2019.
    Figure 6Technology adoption in United States households, 1903–2019. Source shown in the original chart: Comin, Hobijn, and other sources compiled by Our World in Data.

    In light of the preceding graphs, it becomes indispensable to pause here to discuss the widely known ethical-moral justification of capitalism according to which it is an ideal system in ethical and moral terms because it provides greater welfare than its predecessors (primitive community, slavery, and feudalism). Such logic omits nontrivial matters. For example, the justice of a social order cannot simply be measured by the relative welfare (measured only in material terms) that it provides its citizens, because by that logic Hitler would unquestionably have been more just than some chief of a gens (from the period of primitive community when matrilineal succession prevailed—through the mother, before gender discrimination existed), even though such chiefs were not genocidal, did not discriminate (social classes did not even exist), and such reasoning would also omit the fact that technological progress is a social achievement (collective, fundamentally the achievement of the working class, which includes scientists and technicians) and cumulative (technological change may be greater under capitalism, but the capitalist class did not therefore invent it—and in general it is not even the class that conceives it intellectually). Surely not only Jews and Poles but also many Germans would disagree with such reasoning.

    The technological level available to a social system must be considered jointly with the material welfare it provides to its citizens (and this is still without complicating the issue by adding psychological welfare), because only in that way can a system be analyzed in terms of the welfare that the system itself is capable of providing, thereby avoiding vulgar reductionisms when comparing social systems whose progress is cumulative and which are separated by thousands of years. In other words, the relative technological level available to a system (relative to its contemporaries) must constitute the standardization factor that makes comparison among the different systems of social production that have existed throughout history logically optimal. In this respect it is evident that capitalism can only properly be compared with slavery, although it is obviously superior in terms of human dignity, which is simultaneously a cause for joy (we have evolved a little) and sadness (we have most definitely not evolved nearly enough).

    Political power, sociologically understood, as defined by the Salvadoran political scientist Dagoberto Gutiérrez, is a social relation based on differences in resources that serves either to transform reality or to prevent it from changing. This definition is important because it refers to the existence of a particular order.

    It was stated earlier that the moments of force of the lever crystallized the idea of the action of a force external to a reference system altering that system (not necessarily changing its state, since not every contradiction is antagonistic), and it was also said that “violence” implied extraordinary force and intensity, sufficiently extraordinary to produce the effect of taking something—whatever it may be—outside its natural state. What the preceding paragraphs expressed through the formal sciences and the so-called “hard sciences” is the natural state or natural order of the capitalist system of political economy, and the role of violence in history is, as Engels already said in a work of his own bearing the same name, to be the “midwife” of history. This is connected with the celebrated reflection of the Italian political thinker Antonio Gramsci that the old always gives way to the new, but never without first resisting it; or, what amounts to the same thing, that in the context of class societies, in the process of creating a new world, a new society, processes of annihilation simultaneously occur among the component parts of present society (the social classes of that society). This will be addressed again at the end of the exposition, since it is indissolubly connected with the answer to the question initially posed here.

    Of course, for one mode of production to be replaced by another there must also exist a certain technological level that allows one set of social relations of production to be replaced by another that is technically superior (as slave relations were technically superior to those of primitive community, feudal relations to slave relations, and capitalist relations to feudal ones). In Physics, a qualitatively similar structure of change appears in phase transitions, in which the quantitative modification of certain variables or parameters changes the conditions of stability of a previous state and, after a certain critical regime is crossed, a new qualitative organization of the system emerges. This does not mean, obviously, that a change in the mode of production is formally a physical phase transition, but rather that both processes may share the same general dialectical structure of quantitative accumulation, loss of stability, and qualitative leap (the classical example in the foundational history of Marxism is embodied in the changes of state of water under sufficient variation in physical conditions; here I have tried to present more heterodox examples).

    The preceding analogy is possible because both Nature and Society are governed by objective universal laws[1], the dialectical-materialist laws, and this is consistent with the fact that Nature is structurally reflected in its constituent parts, among which conscious organic life is found (of course, only when one speaks of formally defined mathematical isomorphisms does it make sense to require perfect mathematical equivalence). The celebrated Marxist evolutionary biologists Stephen Jay Gould, Richard Lewontin, and Richard Levins discuss this fact in various works, including The Structure of Evolutionary Theory (Gould), The Mismeasure of Man (Gould), The Dialectical Biologist (Lewontin and Levins), Biology Under the Influence: Dialectical Essays on Ecology, Agriculture, and Health (Lewontin and Levins), and “A Reply to Orzack and Sober: Formal Analysis and the Fluidity of Science” (Levins, where he also points to foundations of complexity based on the number of topological dimensions of the structure analyzed), among others.

    It is necessary, however, to make a clarification here in order to avoid a confusion that is by no means trivial: that Nature and Society form part of one and the same material reality and that certain general dialectical laws may manifest themselves in both does not mean that a society is formally a molecule, a quantum field, a thermodynamic system, or any other particular physical object; nor does it mean that a political conclusion can be directly deduced from a physical equation. What is being maintained is something different: qualitatively different material processes may reproduce the same general logical structure of transformation. The relation invoked here is therefore a qualitative structural correspondence of one and the same underlying dialectical logic, not a formal identity among the particular sciences that study each domain.

    Put differently, the fact that water changes state, that a molecule qualitatively modifies its properties or function when a relevant structural relation changes, and that a society undergoes revolutionary transformation does not mean that all three phenomena obey the same particular equations (it would be ridiculous to ask a Schrödinger equation to explain the French Revolution or an equation of class struggle to determine the energy spectrum of an atom); it means that in different domains of matter general forms of change may reappear in which a quantitative accumulation alters the conditions of stability of a previous state and makes possible the emergence of a new quality. The particular laws belong to each science; determining the most general form of change belongs to the philosophical plane.

    The particular laws belong to each science; determining the most general form of change belongs to the philosophical plane.

    What has been stated above concerning the qualitative structural correspondence between phase transitions and revolutionary changes in society (which entail the passage from one mode of production or social order to another) seeks to lay the logical groundwork so that it should not be surprising to say that the technological level necessary to replace capitalist social relations of production with others does not appear to exist (and, furthermore, no others are known; more will be said about this later), while it appears more than sufficient to reduce considerably the degree of incivility prevailing in class societies (specifically, in this case, contemporary capitalism), although this would inexorably entail a reduction in the rates of profit of the capitalist class, from which this uncivilized and uncivilizing order emanates, but which curiously does not itself suffer its “benefits.”

    · · ·

    Capitalism, socialism, and the State

    Why is it said that the technological level for such a matter does not appear to exist (at least not in a generalized form in every society—and that is a detail of vital importance both analytically and practically)? The answer is related to the refutation of another idea widely disseminated throughout the last century and regarded by many unwary people as the irrefutable scientific-technical proof of the impossibility of Communism: namely, that socialist and even communist social relations of production existed in the Union of Soviet Socialist Republics (depending on which “enlightened” person one happens to be speaking with). When capitalist social relations of production are discussed, it is possible to define them well (to situate them within a general and relatively precise theoretical framework—the precision will vary according to the aspect of reality analyzed and/or the theoretical framework employed by the researcher, which is the meaning of “well-defined” in Pure Mathematics). Does the same occur with “socialist” and/or “communist” social relations of production? Let us briefly review the theoretical-historical and empirical-historical evidence.

    The work of Marx and Engels centers on a systematic critique (a systematic analysis oriented toward transforming reality) of the capitalist system of political economy, and there are only a very few and very brief passages in which Marx and Engels discuss some future non-capitalist mode of production (considering their mature works, beginning in the temporal neighborhood centered around the publication of The Poverty of Philosophy—the immediately preceding and following publications). In particular, in Volume II of Capital, Marx lays out rudimentary guidelines for an economic policy concerning surpluses and deficits of fixed assets in a society without private ownership of the means of production and without paper money (let no one imagine Tinbergen’s On the Theory of Economic Policy or anything of the sort; it is a paragraph of a few lines). Engels, in Anti-Dühring (a book positively cited in Lewontin and Levins’s The Dialectical Biologist—which contains in its opening pages a dedication to Friedrich Engels that reads, “To Friedrich Engels, who got a lot of things wrong but got what mattered right”—as well as in other works), argues that the law of value initially ceases to govern only labor power (under socialism) and subsequently the other commodities as well (under communism), being replaced in both cases by a new law according to which the value of commodities is determined by the social needs they satisfy; Engels also develops arguments clearly reinforcing this direction concerning the validity of the law of value in Socialism: Utopian and Scientific.

    One cannot deny the furious anti-Marxists and anti-communists roaming about (and they are so dangerous because if they do not understand what Marxism is, still less do they understand what Socialism and Communism are) that the central cell—the progressive extinction of the law of value—exists and is defined. Yet surely even they cannot deny not only that it is minimally defined, but also that there is an enormous difference between a minimal cell and an organism functioning as a self-organized system (a phenomenon appearing in complex systems studied in the mathematical theory of complexity and consisting in the configuration of an order resulting from the interaction among the elements of an initially disordered system—the social state resulting from the resolution of crisis and the transition from one mode of production to another). As an example, the amount of time that elapsed before the first cell initiating life on Earth (since statistical simulations probabilistically indicate that this is how it happened) became a biological system as such was certainly not short.

    Moreover, what social relations of production were implemented in the Soviet Union? Was labor power remunerated according to the social needs that it satisfied? What scientific-statistical methodology (and here the role of technological level begins to become visible) did they use to quantify those needs—which are not merely material but also spiritual[3], as Marx makes clear in his Economic and Philosophic Manuscripts of 1844? There was no private ownership of the means of production by persons considered as members of civil society, but there was paper money (where instead there should have existed some well-defined system of equivalence among commodities not subject to artificial fluctuations—not subject to price variation, since paper money and speculation do not exist—that faithfully reflected in exchange relations the technical conditions of production of the commodities being exchanged) and there was state private property (because it is a fact that members of the Communist Party did not live in the same way as the people—even so, the people had greater material dignity than under Western capitalism then and now, although the spiritual dimension remained unresolved; and greater material dignity was hardly detrimental to the people). Thus classes existed insofar as the enjoyment of the social product did not belong to those who produced it—this is the fundamental characteristic—but to the Soviet political class, which underwent bourgeoisification and transformed the Soviet State (beginning with Stalin) into what Marx described as political power, namely, “the organized power of one class for oppressing another” (in classless societies the State is merely an administrator; organs of war directed toward political—class—repression such as police and army do not even exist, because without class antagonisms political power also ceases to exist). This was so even though oppression in the material plane was far less forceful and intense than in the West, while ideologically it was less subtle—the West is more elegant in its methods; one need only ask Merkel about the microphones installed in her office by the Government of the United States that produced a diplomatic incident some years ago—and even foreign actors appeared near the collapse of the Soviet Union, for example the bank David Rockefeller opened in Moscow’s Red Square (which does not belong to the set of “conspiracy theories”; it is a well-documented fact that an elementary web search can verify).

    Evidently, what existed in the Soviet Union was State Capitalism, a variant of the capitalist mode of production in which, as Borísov et al.’s dictionary of Political Economy states, it “constitutes a means of struggle against foreign capital, uproots the economic roots of its domination, helps strengthen and develop the national economy. The state sector increasingly stimulates the rapid rise of the productive forces and creates the economic premises for those countries to embark upon a non-capitalist path of development. In the period of transition from capitalism to socialism, state capitalism represents a special form of subordinating capitalist enterprises to the dictatorship of the proletariat, established in order to prepare the conditions for the socialist socialization of all production.” It may also be mixed in the sense that foreign private enterprises coexist with it (while their power over national society is limited) and/or in the sense that private ownership of the means of production is shared by the capitalist State together with domestic or foreign private enterprises (the latter is the case of Cuba, for example), while a case combining the types of state capitalism just mentioned is what occurs in Venezuela.

    All this without yet mentioning that capitalism underwent an extremely extended process of birth, since its economic development preceded by centuries its political consolidation as the dominant mode of production. Medieval boroughs, commercial expansion, mercantile accumulation, and later manufacture prepared the material conditions of the new society over several centuries (a process traceable from the High Middle Ages and which long before 1789 had reached a degree of development sufficient to distinguish the bourgeoisie clearly as a historically ascending class). Nevertheless, it is reasonable to locate its decisive political crystallization in the French bourgeois revolution of 1789 and, as the emblematic milestone of that process, in the storming of the Bastille on July 14. What occurred there was not capitalism appearing out of nowhere—it had existed for a long time and was already developed and diffused to varying degrees throughout the known world of the time—but rather the great bourgeoisie decisively conquering political power and beginning consciously to transform institutions in accordance with the needs of the new social relations of production, a process subsequently expanded across much of Europe, including through the Napoleonic Wars. The date 1789 therefore expresses the political crystallization of a much longer material transformation, not the instantaneous birth of capitalist relations.

    Of course, the advance of the new mode of social production was not linear. It is well known that France subsequently returned for a considerable period to constitutional monarchy because the feudal class temporarily regained power. Nor has it yet been mentioned that the Soviet Union found itself threatened by the West (not merely militarily—the fundamental factor driving it into the arms race—but ideologically as well—one of the factors determining the need to enter the space race), so the planning of its entire economic and social development had to be oriented under these two major constraints. It is no secret among those who knew the Soviet Union that calculations were still being made with abacuses in supermarkets while the country competed on equal footing with the United States in the space and nuclear races (even surpassing it in many respects, obviously at a high cost). In this sense, neither has it been mentioned that there are indications of substantial Soviet financial indebtedness to Western capital during at least the final period of its existence, precisely in order to finance the arms and space races.

    · · ·

    International trade, imperialism, and development

    Finally, a question of fundamental importance arises: why is the situation different in industrialized countries from countries in regions such as Latin America, Africa, and the Middle East? The answer has multiple faces, which will be presented synthetically by moving from the simplest to the most complex and, therefore, from short-run historical aspects (the more recent ones) to long-run historical aspects (those more distant in time). First, one must ask: do relations of distribution in those countries possess the same specific characteristics? Do they have the same tax structure, the same degree of government participation in the economy, the same alignment between fiscal-policy and monetary-policy objectives, the same labor regulations, the same degree of wage indexation to inflation and productivity, etc.?

    If the answer is negative, someone might even consider capitalism functional and believe that all it requires is a sufficiently high level of technological development, which could also seem intuitive to someone, although it remains false nonetheless. To verify its falsity, however, a less superficial analysis is necessary; therefore, it is useful to introduce here the role of international trade, both in its legal and illegal dimensions.

    Beginning in the 1990s, free-trade agreements were signed between industrialized countries (fundamentally the United States) and the countries of Latin America. Some thirty years have now passed since those agreements were signed in most of those countries, and the promised results in economic growth, employment, social development, and related matters never arrived. Instead, inequality increased in those countries (sometimes alongside significant economic growth, but always with rising inequality) and produced a wave of governments throughout the region that broke with Washington’s policies after reaching power through elections, something unthinkable at the end of the previous century, particularly during the Cold War. These free-trade agreements have one fundamental characteristic: they do not take technological asymmetries into account (which become asymmetries in competitiveness) between firms in industrialized and non-industrialized countries. The result of trade is therefore a situation in which, as the celebrated Uruguayan poet Eduardo Galeano put it, rich countries specialize in winning and poor countries specialize in losing (which is merely the generalization to the international plane of the class struggle occurring nationally), because firms from industrialized countries can produce at lower cost and higher quality, against which there is little or nothing that can be done. The same industrialized countries then “generously” offer loans to cover deficits that they themselves, together with the ruling class of the non-industrialized countries, have helped create, at usurious rates (as has been the tradition of international financial institutions such as the International Monetary Fund, the World Bank, the Inter-American Development Bank, etc.), while conditioning the destination of those funds (formally known as “loan conditionality clauses”), which is not only a clear violation of a country’s sovereignty but also a systematic large-scale fraud.

    Why is it said that this pairing of ruling classes produces such deficits in a country’s national accounts? First, because a deficit is generated and/or intensified by trade imbalances (the result of putting “David” without his sling and without divine backing into a fight with “Goliath,” that is, competition between industrialized and non-industrialized countries); second, because they are the only social class that generally and systematically evades and avoids taxes (even though these countries’ tax structures are deeply regressive, which should not be surprising, since the reason they founded these countries was precisely to avoid paying the corresponding tribute to the Spanish viceroyalty—the equivalent of what we now call taxes); third, because public officials whose electoral campaigns are financed by them are commonly not only those who servilely legislate in their favor (the Nobel Prize-winning economist Joseph Stiglitz describes this even for American politics in his book Globalization and Its Discontents—specifically, how those financing Bush’s political campaigns accompanied him everywhere in order to ensure that the commitments he made during the electoral campaign aligned with their interests, and conditioned the financing of the candidate accordingly[2]) but also because one attraction of such servility (in addition to direct payments) for corrupt public officials (who are usually precisely the ones who reach the most important offices, because this forms part of the design of the political system) is the plundering of public institutions. At the political-bureaucratic level, corruption is an inevitable consequence of the exercise of power in class societies (which is why the people must always remain vigilant and organized against it, since corruption never occurs in favor of the majority but only in favor of a minority—whatever minority that may be, but ultimately always of the ruling class, which opens channels favorable to capital accumulation that are legally and formally closed and can therefore only be opened through corruption), while from the political-ideological point of view it results from declassing, that is, from the lack of class consciousness among members of the working class who become corrupted.

    Fourth, we must examine transnational corporations (belonging to the industrialized countries) and the commercial behavior of industrialized countries in relation to the trade policies that they “suggest” (with a financial club in one hand and a military club in the other) that poor countries adopt. It is no secret that the policies of the Washington “Consensus” (curiously, they use such a word when none of the countries to which those policies were “suggested” participated in reaching it; empires must have a peculiar way of understanding dialogue with other nations) are not followed by Germany (which to date has not allowed Walmart to enter, something that produces no newspaper headlines about “communist enemies of the free market,” and whose state participation in the economy over the last half century—and even further back—has never fallen below 50% as a proportion of gross domestic product), still less by the United States [where the FED lends to private banks at a zero rate (and is, in fact, an institution under the power of private actors, specifically American private bankers, obtaining its operating funds from federal revenue, which in a country where the rich pay no taxes—and hence the American Occupy Wall Street protest movement around 2011—is collected fundamentally from the people—a people who paid for the 2008 financial crisis generated precisely by American private bankers, something Joseph Stiglitz describes masterfully in his article “Stupid Capitalists,” easily available on the web); where the agricultural sector contains extremely strong tariff barriers that satisfy no free-market criterion; and many other related features sharing the characteristic of being precisely the opposite of what the country prescribes in economic policy, both fiscal and monetary], Canada, Sweden, or any industrialized country (at least not until the beginning of this century, a matter to be addressed later).

    Moreover, it is no secret that these great transnational corporations, which absorb the domestic firms of non-industrialized countries through legal and less-than-legal means, do not pay taxes in the poor countries they enter. Evidence includes the military coup generated from the United States embassy against Jacobo Árbenz in Guatemala after he demanded that the United Fruit Company pay the taxes established by the Guatemalan tax regulations then in force (which predated his presidency), the military coup orchestrated by the Chilean bourgeoisie and the United States embassy in Chile against Salvador Allende during the last century (which, let us remember, was not long ago), and in general all the bloody right-wing military dictatorships installed throughout Latin America during the last century bearing the bloody seal of Uncle Sam’s democracy, with the “solidary” purpose of exploiting and plundering our peoples.

    The saying “a lamp for the street, darkness at home” may be reversed to produce “a lamp at home, darkness in the street,” which precisely describes the morally hypocritical and economically efficient behavior of the governments of industrialized countries (which express the political interests of the ruling class), whose societies are model societies fundamentally because they succeed in transferring all the social contradictions associated with the bourgeoisie’s processes of capital accumulation into underdeveloped societies, thereby intensifying their underdevelopment. In the United States, considering the same historical moment in comparison, have the same wages ever been paid, the same labor benefits provided, the same number of hours worked, the same number of vacation days granted, labor rights violated with the same intensity (except in the case of undocumented workers, which is why immigration never ends and why the great capitals of industrialized countries are precisely those least interested in seeing it end), natural resources optimized to the same extent (the United States wants to obtain the oil of the Middle East and Venezuela but curiously avoids touching its own reserves), the same quantity of taxes evaded and avoided, etc.? Evidently not.

    Observe that the American and German maquilas that enslave boys and girls in China and Vietnam (to mention only some), and the maquilas that pitilessly exploit women and men for starvation wages in countries such as Honduras, El Salvador, and Guatemala (again, only to mention some) “curiously” are not located in their countries of origin or in any industrialized country [except China; after industrialization it is well known that around 2008 China decided to move toward an “inward-growth” model (because the world economy entered recession, global demand contracted, and although China had been a country whose growth in recent decades was based fundamentally on demand for goods and services from the rest of the world—which is why its GDP grew so strongly despite very low wages and labor vulnerability, the very features of the Chinese working environment that attracted Western firms—it was not significantly affected by contractions in world demand beginning with the 2008 financial crisis because—as Marcelo Justo reports in his BBC Mundo article “The countries where the minimum wage rose the most,” published March 5, 2015—the Chinese authorities had already planned and publicly announced before the crisis that the Chinese economy would migrate toward a growth model based on domestic demand, so income redistribution had already begun within China before the crisis in order for the final consumption demand of so many millions of Chinese people to stimulate the Chinese economy instead of demand from the rest of the world—thus between 2005 and 2015 the minimum wage rose by between 8% and 13%, while Expansión/Datosmacro.com reports that China’s interprofessional minimum wage rose from 170.3 euros in 2013 to 271.6 euros in 2018—and this is how China was able, despite the contraction in global demand, to continue growing and consolidate itself as a hegemonic empire, something that occurred in the context of the COVID-19 health crisis), so Western maquilas have begun progressively moving to countries such as Vietnam, because a model based on domestic demand—which is the model found in industrialized countries—is incompatible with starvation wages and related labor conditions that those same industrialized-country maquilas seek elsewhere]. They are located precisely in underdeveloped countries, in poor countries. What interest, then, could they possibly have in the development of poor countries? The slightest common sense suggests none. Additionally, it should be said that they are equally uninterested in caring for the environment when it is not their own environment, as shown by the well-known practice of open-pit mining by Canadian corporations in Latin American countries.

    Of course, nothing has yet been said about the plunder carried out by industrialized European countries against non-industrialized European countries such as Greece, Portugal, and even Spain (which is a strange economic creature because it is relatively industrialized—not to the level of Germany, but industrialized—while being plundered without restraint by its domestic bourgeoisie and by foreign bourgeoisies, fundamentally by the bourgeoisie owning the German empire—obviously it is an empire; the fact that it does not display the caveman manners of the United States is another matter—which is the bourgeoisie fundamentally engaged in plundering all of underdeveloped Europe; Germany does not lend to Greece, Spain, or Portugal in order to lift them out of underdevelopment either—that would amount to “shooting itself in the foot,” since in imperial republics the republic depends on what the empire plunders). But this is discussed not only by Nobel Prize-winning economist Joseph Stiglitz in his article “The Capture of the ECB” (referring to the control of the European Central Bank by European financial capital), but also in the famous case of the president of the International Monetary Fund, Dominique Strauss-Kahn, who wanted to forgive Greek debt (because, as Joseph Stiglitz and Paul Krugman—also a Nobel laureate—as well as Yanis Varoufakis—the Greek Finance Minister in charge when debt renegotiations with the Troika took place—have argued, Varoufakis recounts in various interviews available on YouTube, some together with Joseph Stiglitz, others with Slavoj Žižek, and others with Noam Chomsky, that during the negotiations he received telephone threats concerning his son’s safety if he did not abandon his negotiating line—opposed to that of German capitalists, but he continued, as he should have; when someone confronts capitalism he is seeking to guarantee the survival of the species and any collateral damage that is not the species in general, the people, is acceptable—as well as evidence in both action and words from German negotiators that German financial capitalists did not actually want the debt to be paid, because the debt was not only about the profitability of capital but also possessed a political component: they wanted to politically subjugate Greece—a left-wing party, Syriza, had come to power—in order to keep it economically subjugated. Thus, for negotiations to continue, following the cowardice of the democratically elected president—who had submitted to the Greek people in a referendum whether they were willing to face the consequences of deciding not to pay the debt to the German bankers, and the people magnificently voted YES!—Yanis Varoufakis had to resign so that negotiations could continue, now in a docile tone toward international financial capital, which constituted a flagrant betrayal of the people by the Greek “left.”

    Thus another myth is dismantled, and all of this without mentioning the role played by vulture funds in the economic policy of underdeveloped countries or the plunder of the African continent and the resources of the Middle East. It would be interesting to compare the income that great international capitals obtain from the sum of the entire underdeveloped economy (both legal income and illegal income from the illicit traffic of weapons and drugs—which politicians in poor countries permit more readily—the slave labor exploited by American diamond companies in Africa, and the value of natural resources appropriated without payment) with the income they obtain within the United States alone, in order to gain an approximate idea of the magnitude of the plunder carried out in Latin America, Africa, and the Middle East. Marx expresses this in arguing that the world market merely transfers capitalism’s internal contradictions to a broader sphere of action or, in the words of the political scientist Dagoberto Gutiérrez, every imperial republic (a republic that has developed sufficiently within the international context of social classes to become an empire as well) consists precisely of the republic as such and the empire as such, and in this sense the flourishing of the republic depends upon what the empire plunders from the colonies it subjugates. Of course, although this occurs with the United States (precisely as it has been displaced by China and Russia in the world market as hegemonic powers, the flourishing of its republic has become progressively conditioned until reaching the lamentable condition in which it now finds itself—the reason is that the world surplus or surplus value is redistributed differently when hegemony changes, in a fashion that has progressively become less advantageous for the American empire), this is not the first time it has occurred, and it is a characteristic of every imperial republic, a planetary-scale social phenomenon in which class struggle reaches its most general expression; such was the case with the Romans and their plunder of barbarian peoples during the era of the slave mode of production.

    · · ·

    Primitive accumulation and the colonial legacy

    Now it is time to address the widely disseminated idea (and surely one shared by most people—alienation is powerful) that colonial plunder has no influence on the present socioeconomic conditions of the peoples of Latin America and Africa or, more generally, that the past has no influence on the present (which is merely the essence of the first idea). In the great Marxist economist Ernest Mandel’s Late Capitalism, it is stated that the value of the gold plundered from the Americas was equivalent to ten times the entirety of European railway capital of the period. Let us bring that fact into the present (afterward it will be time to examine whether the stated multiple is correct or incorrect).

    It is evident that during the implementation and diffusion of the Industrial Revolution the firms moving the greatest amounts of capital were precisely those belonging to the railway sector, since that sector or productive branch (to use Marxist terminology) moved not merely the steam engines as such (as an innovation in themselves), but also the steel from which those machines were constructed and the steel used to construct the tracks upon which those machines moved. In the midst of a process of generalized industrial expansion across an entire continent (the Industrial Revolution first manifested itself phenomenally in 1760 in Manchester—surely on a rainy day, or perhaps it did not rain that day?—and its generalized implementation in Western Europe, the United States, and Canada was consolidated by 1840), this would hardly seem a trivial matter, especially considering that, as Marx reports in Volume I of Capital, drawing in turn on well-referenced official public reports of the period, royal decrees were approved allowing the nascent bourgeoisie to plunder churches and the tombs of saints through violent means (and others not quite so violent), extracting any gold possessions (including gold teeth) for minting currency. Common sense would appear to indicate that, relative to the circulation requirements of European capital at the time, there was not enough gold; on the contrary, it became extremely scarce relative to those requirements. Merely as additional information of interest, it should be mentioned that violent means were also used to expropriate direct producers from their lands (surely more violent means, since the Church was not entirely devoid of power), and this, together with actions of the same ethical-moral stature (judge that ethics and morality however one wishes), constitutes the “secret” of primitive accumulation.

    Not only does the impact of European gold plunder appear far from negligible in terms of the initial resources available when the republics of the Americas (fundamentally Latin America) were constituted following the independence processes occurring across the continent, but it also appears to have been fundamental to the functioning of European capitalism. One should not forget that the beginnings of the Industrial Revolution in Europe were far from decorous, and grotesque facts are perfectly documented: 18-hour working days for men, 16 for women, and 14 for boys and girls, overcrowding in factories, the hiring of paid killers (the famous “strikebreakers”) in case workers organized to demand a little dignity and, for brevity, “et cetera.” European capitalism was built upon the sweat, blood, and tears of America, fundamentally Latin America.

    Now it is time to address the scale factor, that is, the claim that the plundered gold bore a ratio of 10 to 1 to railway capital. Assume that Mandel maliciously exaggerates the figure by a factor of two (to choose a relatively arbitrary number), producing a ratio of 5 to 1; then assume that Mandel takes the number from a source measuring it with a 50% error, leaving a ratio of 2.5 to 1; finally, assume that macroeconomic accounting at the time had profound deficiencies and recorded the data with another 50% error, producing a ratio of 1.25 to 1, that is, 125%.

    Evidently, the joint requirements of capital and circulation at the time of the first great Industrial Revolution in history appear to have been harsher (even socially) than those observed in 2021 during the COVID-19 pandemic; nevertheless, using this pandemic as a reference will suffice to finish making the point, which is nothing more than a simple question: what impact would it have on a businessman today, in terms of the consolidation of his firm and its future rate of capital accumulation (the rate at which surplus value—capital—reproduces itself or, in other words, at which the capitalist’s investment returns and expands the volume of functioning capital), if in the context of the health crisis and economic crisis someone for some reason simply gave him capital worth 125% of the capital he already had in operation (without interest, tricks, legal implications of fraud, or anything of that sort)? Once again, it is evident that European capitalism was built upon the blood, bones, and tears of America, fundamentally Latin America, in addition to the obvious impact that such plunder had upon America itself (everything that might have been done with those resources). And this is without yet mentioning the impact on primitive capital accumulation and on the capital accumulation that made consolidation of the Industrial Revolution possible through the slave labor power obtained by military means throughout the Americas (and that is no trivial detail, because the Roman Empire, the greatest empire in history, was built upon slaves and plunder—and the feudal class did likewise—so in the best possible case its contribution was “merely” significant).

    In a world in which things operated with absolute justice, they ought to return everything stolen with the same usurious interest rates at which their financial institutions lend to Latin American countries or pay the debt of their ancestors with their own blood, but evidently we do not live in the world of the just but in the world of the strong; it is a malicious jungle, because not everyone arrives in the jungle with the same resources (and therefore the jungle is not equally savage for everyone). Evidence of this is that the Industrial Revolution did not arrive in Latin America, and while it unfolded in Europe people here were struggling to free themselves from the colonial yoke of murderous invaders who mixed indigenous peoples with rapists, murderers, kidnappers, and other forms of lumpenproletariat; that is, Latin America was not forced to mix with Europe’s best men (and here it really is appropriate to say only men, because those who directly committed these atrocities were men, even though society in general was complicit), but rather with the decomposition of its society. In the United States they simply exterminated indigenous people without mixing with them and left a few as a kind of “exhibit” in certain enormous forest cages called “Indian reservations,” as though they were elk or deer—the ways of Yankee democracy (which is why what they did and continue to do in Washington with undocumented boys and girls should not seem surprising, not only under Trump but under Biden as well; they have done it since the country’s foundation). Finally, it should be remembered that plunder continues not only financially (through the intensification of deficits and loans at usurious rates to “correct” those deficits—to date no country has managed to correct them using those prescriptions), but also through the asymmetric free-trade agreements mentioned above, which not only dismantle the national productive fabric but legally permit aberrations such as allowing only American companies to possess a monopoly (this is the case for El Salvador under CAFTA-DR, which stands in flagrant conflict with the country’s Constitution, since the latter establishes that only the State may do so—and here the philosophy of free-market fundamentalism is clearly revealed: the market above the State or, in other words, capital above human beings).

    The foregoing does not include the fact that these trade agreements allow, explicitly or implicitly (the Salvadoran economist Raúl Moreno has written abundant and precise research on the matter), industrialized countries to patent biodiversity existing in poor countries without compensating in any way the country possessing that natural wealth, and then use that biodiversity to create medicines that are sold back in poor countries (from which the active ingredients were extracted) at exorbitant prices (far above the technical conditions of production of those medicines and, above all, far above the real costs of the inputs, since the biodiversity was obtained for free—like gold exchanged for mirrors—and at most one can count the cost of transporting it, which is trivial in comparison with the cost that might have been involved in purchasing the biodiversity and patenting it—how much would they charge if the situation were reversed?). Among many other matters that need not be mentioned because the point has been conclusively demonstrated, there is also the fact that in many instances such medicines served to cure diseases that they themselves had produced through experiments carried out behind people’s backs, using them as guinea pigs, something perfectly documented in Guatemala and Puerto Rico, although surely those were not the only countries to experience the “sweetness” of international Yankee democracy (all the foregoing concerning present plunder, merely to mention a couple of examples for the sake of brevity). Thus plunder did not merely occur in the past: it continues, and present generations of the “old” continent are therefore as guilty as their ancestors insofar as European capitalism continues to be built and to function.

    · · ·

    Violence, women’s struggle, and social transformation

    And now the time has come to close this exposition by examining more deeply why violence is the midwife of history and under what conditions violence in social struggle is justified as a historical necessity of peoples. When one analyzes the evolution of capitalism, it becomes evident that every social right obtained by the working class has been wrested by force from the capitalist class (from the eight-hour working day to the minimum wage, the year-end bonus, women’s right to vote, among others), except for the right of women to work (speaking here of the period in which the Industrial Revolution was becoming established), because this suited the capitalist class insofar as it caused wages to fall (through the simple law of supply and demand), increased the number of unemployed workers (the industrial reserve army or relative surplus population, with all the psychological importance this has in causing workers to self-exploit for fear of losing their jobs), and, holding output at a given level, even though individual wages declined, the total wage mass increased, which will always unfailingly benefit the capitalist class in its accumulation of capital, but not necessarily the working class (that depends on concrete circumstances, since one would have to examine the specific values assumed by changes in real wages—other things being equal, such as the statistical measurement of the basic consumption basket, for example—but if such changes are negative, they are not favorable, unless they are positive).

    Women are demanding a change in the culture of those men who are significant accomplices of machismo (and of those women who are significant accomplices of machismo as well); however, it is evident that these changes can only arrive through public policies that strengthen women’s security (which should not be confused with militarizing society—something much favored by Latin American oligarchies and bourgeoisies) and through ferocious public campaigns against the machismo from which society suffers as a structural disease.

    The matter becomes more complicated when one considers that implementing the two public policies just mentioned (necessary to satisfy the just demands of feminists) requires resources (which must be obtained from public coffers plundered by the domestic ruling class, the foreign ruling class, and the domestic governing class); that the ruling class is and always has been patriarchal (the “breeding ground” of oppression among human beings is the oppression of women by men, as Engels masterfully explains in The Origin of the Family, Private Property and the State—and in this sense the bourgeois class is no exception); and that this would hardly seem a trivial matter. Moreover, those two public policies require a whole set of complementary public policies given how deeply rooted machismo is in the social psyche (which implies monitoring those policies through time with a view to periodically maximizing their effectiveness—optimizing them) throughout the world, regardless of the fact that it assumes cruder and more visible forms in Latin America (at least generally, since exceptions clearly may exist), because it is associated with class struggle, the distribution of income, and another series of fundamental variables of the capitalist system of political economy in general (here I am not referring merely to the capitalist system of political economy as a productive system in particular, but to it as society or social system). The resources necessary for such public policy, at least in Latin America and especially in Latin America during the health and economic crisis, do not appear capable of coming from anywhere other than collecting more taxes from the working class (which does not appear easy, since raising wages could damage profits, public coffers are empty—they and their henchmen have plundered them—and collecting more taxes on consumption—regressive taxes paid by the people—would not only aggravate the economic crisis with near certainty but could also harm profits if final consumption demand falls sufficiently—which is the only thing they care about) or finally “daring” themselves to pay taxes (which seems like an extraordinarily abstract utopia, given that they founded these countries precisely in order not to pay taxes).

    Before continuing it is useful to distinguish several senses of the word “violence” that belong to the same genus but are not therefore identical in each of their concrete determinations. In the most general sense used in this exposition, violence is an extraordinary force or intensity capable of removing a system from the ordinary reproduction of its state; in the social realm such a rupture may take the form of strikes, blockades, occupations, disobedience, destruction of objects or symbols, intrusion into institutional spaces and, under certain historical circumstances, physical confrontation between persons or groups. All these forms share the fact that they overcome or attempt to overcome resistance from the existing order, but they are not therefore tactically identical nor do they necessarily produce the same effects.

    The general legitimacy of violence exercised by those systematically subjected to an oppressive order against the structures reproducing that order does not mean that every individual act, merely because it is violent, is automatically intelligent, necessary, effective, or ethically and politically indistinguishable from every other act. It means something prior and more fundamental: one cannot condemn the violent rupture of an order in the abstract while accepting as invisible, normal, or “civilized” the structural violence through which that same order reproduces itself every day. The concrete form that such violence should assume is a historical, tactical, and political problem and, like every concrete problem, can only be resolved through the concrete analysis of the concrete situation.

    An order that actively resists its own transformation does not change simply because it is asked voluntarily to stop being what it is.

    How could a state of affairs such as the one described above (founded upon violently spilled blood, hunger, deceit, ideological manipulation, false hopes, and in which those who benefit from such a state of affairs have no interest in seeing it change) be altered even minimally without violence? To demand “civilized” behavior from the women who took to the streets is not only to demand something whose meaning is hardly free of ambiguity; it is to demand that they not seek to alter the existing state of affairs, because those who criticize that use of violence are those who (through convenience or ideological alienation) conceive the present state of affairs as civilization itself. The same applies to racism and the demonstrations unleashed in the United States following the case of police violence that ended in the tragic death of George Floyd.

    The response “Those are not the right ways” does not appear valid, because the opposite ways have produced no result over several decades (at least since the final decade of the last century people have been talking about eradicating machismo, and in Latin America it becomes more acute by the day—and Europe in general does not seem very different), and it is they who live, breathe, walk, dream, think, love, and miss others while anguished and afraid, burdened with complexes and trauma. “Those are not the right ways”? Recall the definition of the quality of being violent: “that which implies extraordinary force and intensity,” that is, outside what is ordinary. And what is “ordinary” related to? The word “ordinal,” according to the same RAE dictionary already cited, means “belonging or relating to order”; and in this sense, understanding order as the natural order of a system of political economy in general and considering that the same dictionary defines “to violate” as “to apply violent means to things or persons in order to overcome their resistance,” it is evident that the demonstrations had to exercise some form of violence upon the present state of affairs in the general sense defined above: to interrupt, block, disobey, intrude, or in some way prevent the order from continuing to reproduce itself as if nothing were occurring. This does not determine in advance which concrete form of violence is tactically appropriate in every circumstance, but it does determine something prior and more general: an order that actively resists its own transformation does not change simply because it is asked voluntarily to cease being what it is (which is why humanity has used and will continue to use different forms of violence for as long as societies exist in which individuals cannot peacefully resolve contradictions that, by virtue of their social structure, are irreconcilable—class interests).

    Indeed, an alternative definition of “to violate” is “to enter a house or another place against the will of its owner.” If republics are the estates of the “Latin” bourgeoisie and oligarchs (who generally tend to have more European ancestry than otherwise), then the young women of a few days ago decided to enter the house to negotiate against the will of its owner because the owner refused to come out and engage in dialogue. In reality, the owners of these countries have never liked dialogue, because a ruling class must possess considerable intelligence to favor dialogue and it does not appear realistic to expect this from non-industrialized ruling classes. After all, in class societies the psyche of the ruling class is reflected (although in distorted form) in the psyche of the dominated class (this is what alienation consists in), and everyone understands perfectly well that underdevelopment is not merely material but also possesses subjective, psychological elements. If the rights of a massive sector of society (women) are being systematically violated through policies dictated by the owners of the house to its administrators (the governing class, professional politicians), if dialogue is sought with them and they refuse to engage with the affected social sector, I believe my grandmother would agree that the proverb “A word to the wise, a stick to the fool” is appropriate. She surely had not read Gramsci, but she had read life itself.

    Let this era, then, be the era of revolutions at every scale or, at the very least, let it be the era in which humanity begins to move irreversibly toward its extinction because we are incapable of understanding one another, as we did manage to do so many thousands of years ago when we left Africa in search of new horizons and, as Homo sapiens, prevailed over the Neanderthals in the unbridled race for survival while confronting, as a common enemy, a nature that was merciless relative to the technological precariousness of the period. It must never be forgotten that Neanderthals were not intellectually rudimentary creatures in comparison with Homo sapiens: they possessed brains of similar and often larger absolute size, developed relatively sophisticated technologies, and there is convergent evidence of symbolic behavior and at least certain linguistic capacities[4]. In what, then, might a decisive advantage of Homo sapiens have consisted? Not necessarily in some simple intellectual superiority, but, among other factors still under debate, in demographic differences and in the capacity to construct broader social and cooperative networks; put simply, in the scale at which we managed to understand one another. It is time to begin a reverse exodus toward our roots (which will surely take several centuries) or to disappear irretrievably because of our stupidity, which curiously is a characteristic belonging only to rational animals.

    Notes

    1. The adjective “universal” is used here in a philosophical sense, not to claim that the particular laws of Physics, Chemistry, or any other science can be transferred without mediation from one domain of reality to another. Particular sciences formulate general laws within the objective domains they study, whereas dialectical-materialist laws are posited here at a higher philosophical level of generality, referring to general forms of the movement and transformation of matter. Reality is multifaceted, and one and the same material object acquires qualitatively different determinations according to the concrete relation under which it is studied: a building is fixed capital from certain categories of Political Economy and Accounting, a material body subject to physical interactions from the standpoint of Physics, a structural system from the standpoint of Civil Engineering and, in a topology-optimization problem, a structure whose design can be optimized by means of a given objective function—for example, minimizing mass, cost, or a particular measure of deformability or structural compliance subject to the corresponding constraints. The building did not change as material reality; what changed was the concrete determination under which that same reality was being studied.

    2. As subsequent institutional context—and not as proof of the specific episode involving the Bush administration described above, which predates these rulings—it is worth recalling that on January 21, 2010, the Supreme Court of the United States decided Citizens United v. Federal Election Commission. What the Court held unconstitutional was not the limits placed on direct contributions that an individual may make to a candidate, but certain prohibitions imposed on corporations and labor unions regarding independent electoral expenditures made from their own funds; the prohibitions on direct corporate contributions to candidates remained in place. Shortly afterward, on March 26, 2010, in SpeechNow.org v. FEC, the United States Court of Appeals for the District of Columbia Circuit concluded, relying precisely on the constitutional logic developed in Citizens United, that contributions to organizations devoted exclusively to independent expenditures could not be limited either. The combination of these legal developments produced the contemporary regime of so-called Super PACs, or independent-expenditure-only committees: they may receive unlimited contributions from natural persons, corporations, labor unions, and other political committees, but may not contribute directly to candidates and, precisely in order to remain legally “independent,” their expenditures may not be coordinated with the campaigns they favor.

      The difference, then, is not that a billionaire or corporation formally possesses a freedom of expression denied to an ordinary individual—natural persons may also make unlimited independent expenditures—but rather that a formally equal liberty operates upon a profoundly unequal distribution of resources and therefore produces materially very unequal capacities to finance political speech. During the 2019–2020 electoral cycle, an individual could contribute directly up to $2,800 per candidate per election, while independent expenditures reported to the FEC during that cycle exceeded $3.1 billion. That is precisely where the politically relevant issue lies: the legal separation between “direct contribution” and “independent expenditure” allows enormous differences in economic power to become enormous differences in effective political influence without any need to hand the money directly to the candidate. Profoundly changing this regime is not impossible within the legal order itself—a later Supreme Court may revisit its precedents, and the Constitution itself may be amended through the extraordinarily demanding procedures of Article V—but it is clearly an institutional structure extraordinarily difficult to transform through ordinary legislation.

    3. “Spiritual” is used here in the historical-philosophical sense corresponding to terms such as the German geistig, that is, referring to the intellectual, psychological, cultural, conscious, and affective dimensions of human life rather than to the existence of some supernatural substance or a religiously understood “spirit.” In the Economic and Philosophic Manuscripts of 1844, Marx himself contrasts and relates physical existence and energy with geistige existence and activity, precisely because from his materialist perspective human needs are not reducible to mere biological subsistence: a human being needs food and physical protection of the body, but also knowledge, creation, relationships, love, the development of capacities, participation in culture, and the conscious realization of one’s own life. In contemporary terminology, much of what was called “spiritual” in that tradition could be expressed through psychological, intellectual, cultural, and social categories without changing the substance of the argument.

    4. The fact that the absolute brain volume of Neanderthals was similar to and often greater than that of modern Homo sapiens does not allow us to conclude that they were “more intelligent,” because absolute brain size alone is not a sufficient measure of cognitive capacity and must be considered, among other factors, in relation to body size, brain organization, and the functions performed by its different regions. What can be stated on much firmer grounds is that the old representation of Neanderthals as cognitively rudimentary creatures is untenable. Sverker Johansson, in “Language Abilities in Neanderthals,” published in Annual Review of Linguistics, volume 1, in 2015, jointly reviews anatomical, archaeological, and genetic evidence and concludes that Neanderthals possessed at least certain linguistic capacities and were capable of symbolic communication, although this does not by itself establish the existence of a fully modern syntactic language identical to ours. The causes of Neanderthal disappearance remain a subject of scientific debate and cannot be reduced to supposed intellectual inferiority; factors seriously considered include demography, population size and connectivity, social networks, ecological conditions, and interactions with Homo sapiens populations.

  • ON THE POLITICAL ECONOMY OF THE SYRIAN CONFLICT (2017 ESSAY)

    ON THE POLITICAL ECONOMY OF THE SYRIAN CONFLICT (2017 ESSAY)

    Essay · Political Economy · Geopolitics

    ON THE POLITICAL ECONOMY OF THE SYRIAN CONFLICT
    (2017)

    I · SectionIntroduction

    The key to understanding the present is understanding the past, just as the key to looking toward the future is understanding the present: “Men make their own history, but they do not make it as they please, under circumstances chosen by themselves, but under circumstances directly encountered, given and transmitted from the past.” (Marx, The Eighteenth Brumaire of Louis Bonaparte, 1975).

    The Syrian political conflict is a conflict among the interests of nation-states and, consequently, it cannot be understood without first understanding what a State is, because otherwise it will also be impossible to understand which sectors of society carry their interests from the national sphere into the international sphere through the State itself.

    In general terms, this concept appears implicitly as far back as the philosophers of ancient Greece, although it is in Machiavelli’s work that the word “State” appears for the first time, where he says: “All states, all dominions that have held and hold power over men have been and are either republics or principalities.” (Machiavelli, 2006, p. 13). Subsequently, throughout history, different political theorists would define it in different ways. Here, two orthodox definitions will be introduced and then contrasted with a heterodox definition. The two orthodox definitions belong to the last classical treatise writer (Hegel) and the last modern treatise writer (Weber).

    Hegel writes on the matter: “The State, precisely, as universal and objective freedom, in the free autonomy of the individual will; the State, which as a real and organic spirit, a) of a people, b) through the relations of the specific national spirits, c) realizes and manifests itself in Universal History as the universal spirit of the world. The Law of the State is supreme.” (Hegel, 1968, p. 33).

    Weber, for his part, writes: “For sociology the reality ‘state’ is not necessarily composed of its juridical elements; or, more precisely, it does not derive from them. In any case there is no collective personality in action. When one speaks of the ‘state,’ the ‘nation’ (…) one refers only to the development, in a certain form, of the social action of a number of individuals, whether real or constructed as possible (…)” (Weber, 2002, p. 12). Having clarified this, he states: “The State, like the political associations that preceded it, is a relation of domination of men over men based on the means of legitimate coercion (that is, regarded as legitimate). Thus, for it to subsist it is necessary that the dominated submit to the authority of those who dominate in each case. When and why they do so can be understood only when the internal motives of justification and the external means on which domination rests are known.” (Weber, 2002, p. 1057).

    Machiavelli’s definition explicitly says little or nothing about the political motives underlying the formation of the State; implicitly, however, it suggests the State’s repressive role or, in his words, “the dominions that have held and hold power over men.” In Hegel’s case, a romantic vision of the State is presented, which is hardly surprising, since for this author the State was the will of God. Historical evidence, of course, shows that the State has little or nothing to do with the free autonomy of individual freedom and therefore cannot be universal and objective freedom either, since individual freedom is the sine qua non condition of universal or general freedom. It is precisely from this definition that the naïve view arises that the State is all of us. If this were so, there would be no way in which the State could be the organic spirit of a people, although it does possess a real existence as a social fact[1] through the relations among specific national spirits. Ultimately, if the State were all of us, there would be no need to create institutions that protect the rights of individuals against the State itself.

    Weber’s definition sheds light on the necessary condition for the State to subsist (the submission of the dominated to the dominant) and the sufficient condition (possessing means of coercion regarded as legitimate). The necessary condition of subsistence is, in turn, the circumstance that makes its existence possible, while the sufficient condition is the most important circumstance guaranteeing its perpetuation. Yet the most important question in terms of political philosophy is precisely the one Weber refuses to answer: why does one sector of society accept submission to another sector? How does a State concentrate the monopoly of physical violence?

    The preceding questions could be answered from Rousseau’s point of view. He wrote: “I suppose men to have reached the point at which the obstacles to their preservation in the state of nature exceed the forces that each individual can employ to maintain himself in that state. Then this primitive condition can no longer subsist, and the human race would perish unless it changed its manner of being. Now, since men cannot generate new forces, but only unite and direct those that already exist, they have no other means of preserving themselves than to form by aggregation a sum of forces capable of overcoming resistance, to bring them into play toward a single end, and to make them act together and in conformity. This sum of forces can arise only from the cooperation of many; but since the strength and freedom of each man are the principal instruments of his preservation, how can he commit them without harming himself and neglecting the obligations he owes to himself? This difficulty, reduced to my subject, may be stated in the following terms: ‘To find a form of association which will defend and protect with the common force the person and goods of each associate, and by which each, uniting with all, nevertheless obeys only himself and remains as free as before.’ Such is the fundamental problem to which the Social Contract provides the solution. The clauses of this contract are so determined by the nature of the act that the slightest modification would render them useless and without effect; so that, although they may never have been formally stated, they are everywhere the same and have everywhere been tacitly recognized and admitted, until, when the social pact is violated, each person recovers his original rights and regains his natural freedom, losing the conventional freedom for which he had renounced the former.” (Rousseau, 2007, pp. 45–46).

    Rousseau’s view, although broadly correct, contains a certain romanticism and leaves questions unanswered. It is romantic to think that a social institution as complex and historically rooted as the State would disappear at the slightest violation of the contract established among the sectors of society involved in that contract. Nor does Rousseau explain the historical pattern that determines how the clauses of such a contract are formulated at each historical moment in the transition from one form of State to another. All sciences seek, in their object of study (for the social sciences, that object is society), to establish general patterns of behavior that allow them to predict future changes in that object, because the ultimate purpose of the social sciences is not merely to explain a social fact, but to predict the behavior of the fact analyzed over time[2]; in that sense, explaining it is only an inevitably necessary step toward achieving that end.

    Once the above is established, the following question arises inexorably: is there a general pattern across the different societies that have existed in human history which explains why the clauses of the different social contracts that emerged in the transition from one social formation to another were established in a particular way? The answer is yes. Rousseau already leaves implicit a fundamental point: necessity as the foundation of the birth of the social contract or, what amounts to the same thing, a clear position on the fundamental problem of philosophy—that material causes determine and subordinate the realm of ideas.

    Rousseau is not alone in taking this position. As can be seen, Weber also attributes the subsistence of the State (what has here been called the “sufficient condition”) to possession of the means of legitimate coercion, that is, the monopoly of physical violence. Weber’s first cause or necessary condition is the submission of the dominated to the dominant, which is itself explained by internal motives of justification (which will evidently have an explanation rooted in the historical conditions of the moment) and the external means (which are objective) on which domination rests.

    Durkheim also proceeds along these lines when he states: “Thus, we must consider social phenomena in themselves, independently of the subjects who form a representation of them; they must be studied from the outside, as external things, for it is as such that they present themselves to us (…) A thing is recognized principally by the fact that it cannot be modified by a simple decree of the will. This does not mean that it resists every modification, but rather that to produce a change it is not enough merely to desire it; an effort, more or less arduous, is also required because of the resistance it opposes to our action and which, moreover, cannot always be overcome. We have already seen that social facts possess this property. Far from being a product of our will, they determine it from outside; they are like molds into which we are compelled to cast our actions.” (Durkheim, 2009, pp. 83–84). Machiavelli states that “Principalities are either hereditary (…) or new.” (Machiavelli, 2006, p. 13), and throughout his work he explains that new principalities are generally acquired by arms and virtue or by the arms and fortune of others. Comte, for his part, writes: “But this provisional instinct, without which science would then have lacked suitable nourishment, must ultimately become habitually subordinated to a just systematic appreciation, as soon as the full maturity of the positive state has made it possible always to apprehend sufficiently the true essential relations of each part with the whole, so as constantly to offer a broad horizon to the most eminent investigations while nevertheless avoiding all puerile speculation.” (Comte, 2017, p. 23). Finally, Marx, an author who will be examined in greater depth below, likewise takes a position along the same lines.

    As can be seen, one of the two great theorists of Political Law[3], one of the greatest political theorists in human history, and the four founding fathers of Sociology are clear, despite their theoretical differences, on the point under discussion[4].

    Having established the above, we can proceed to the next stage of the analysis. Humanity has witnessed four different social formations: a) primitive community, b) slavery, c) feudalism, and d) capitalism.

    If the Social Sciences are indeed sciences and, moreover, the emergence of the different social contracts corresponding to each of the social formations set out above obeys objective factors, the first task is to determine which objective factor is the most important of all. This poses no great intellectual challenge, because before anything else the human species seeks, and has always sought, to obtain the means of subsistence necessary for survival. In this sense, the production of those means of subsistence stands as humanity’s most important material or objective factor, although, contrary to what economicism assumes, it is not the only one.

    “In the production of their life, men enter into definite relations that are necessary and independent of their will, relations of production which correspond to a definite stage of development of the material productive forces. The totality of these relations of production constitutes the economic structure of society, the real basis on which a legal and political superstructure rises and to which definite forms of social consciousness correspond.” (Marx, A Contribution to the Critique of Political Economy, 1989, pp. 7–8).

    It is therefore the relations of production—those relations which members of a society establish in response to necessity at a particular historical level of technological development—that condition social life and around which a particular culture arises, reinforcing them and allowing them to remain stable over time. This in turn means that a particular social contract is constructed around the relations that members of society establish in order to secure the production of their means of subsistence. These social relations of production will also express the degree of development of the productive forces of the period, which in turn will shape the way in which the clauses of the social contract are designed. Now, do members of society establish these relations on equal terms? The answer is emphatically no. Once human beings became sedentary, the enslavement of members of one gens by another and the emergence of the social division of labor gave rise to the slave mode of production. Equality was thereafter erased from the fate of human society, and the social relations of production established in every historical-social formation became a clear expression of the relation between dominant and dominated: slaveholders and slaves, feudal lords and serfs, capitalists and proletarians. The common denominator of these power relations among social classes, expressed in the legal relations of each period (which are no more than the expression of relations of production on the juridical plane), is that one social class possesses the material means for producing wealth—the means of production—while another social class possesses only its labor power with which to secure its subsistence.

    This distribution of the means of production does not, of course, obey the whims of history or random events whose explanations are isolated in character. Rather, in general terms[5], it results from one sector of society finding itself, through historical evolution, in a privileged position that it uses to accentuate its differences from the rest of society, accumulating wealth from that position and achieving a monopoly over the means of exercising physical violence. In Europe, for example, the capitalist class has its origins in the Middle Ages among small merchants, a status accessible only to free men rather than serfs. By buying in the countryside at a lower price than they sold in the city, they began the accumulation of wealth that in its contemporary form we know as capital. Yet the primitive accumulation of capital was not limited to this: independent producers were also expropriated from their lands by force of gunpowder and blood, and decrees were even issued by different kings permitting the opening of the tombs of saints and other religious figures of Catholicism in order to extract any piece of gold—including dental prostheses—which could then be minted into coin.

    Once the foregoing has been established, the State can therefore be defined as the political organization of the economically dominant class whose ultimate purpose is to maintain the existing order and crush the resistance of the other classes through possession of the monopoly of physical violence. It is therefore unsurprising that the process of State formation consisted in setting apart a special public power with its army, police, prisons, and coercive institutions of various kinds.

    In this sense, speaking of democracy, defined as a “Form of political regime based on the proclamation of the principles of the power of the people, the freedom and equality of citizens. Democracy presupposes recognition of the principle of the subordination of the minority to the majority, the electability of the principal organs of State power, and the existence of political rights and freedoms.” (Oníkov & Shishlin, 1980, p. 140), lacks real meaning.

    Contemporary evidence of the foregoing is provided by the 2001 Nobel laureate in Economics, Joseph Stiglitz, who writes: “Finance is not the only area in which foreign investment has been an ambiguous blessing. In some cases, new investors persuaded governments (often with bribes) to grant them special privileges, such as tariff protection. In many cases the U.S., French, or other advanced industrial-country governments exerted pressure, reinforcing the notion in developing countries that it was perfectly appropriate for authorities to intervene in the private sector and presumably collect from it. In some cases, the role of the State seemed relatively innocuous (although not necessarily incorruptible). When U.S. Secretary of Commerce Ron Brown traveled abroad, he was accompanied by American businessmen seeking contacts with those emerging markets and entry into them. Presumably, the chances of obtaining a seat on the plane increased if one made significant campaign contributions.” (Stiglitz, 2003, p. 100).

    · · ·

    II · SectionHistorical Background of Syria

    Syria is a country whose population is concentrated in the northwest of its territory, which is due to the fact that only 0.06% of its surface area has water. According to (Datosmacro, 2017), Syria has a population of 18,502,413 inhabitants and a total area of 185,180 km.2, which is equivalent to a population density of approximately 100 inhabitants per square kilometer.

    According to (OPEC, 2017), Syria has 2.5 billion barrels of oil in reserve, ranking 31st in the world; however, these are only proven oil reserves[6]. According to (CIA, 2017), Syria also ranks 43rd worldwide in terms of proven natural-gas reserves, with 240,700,000,000 m.3

    This significant quantity of natural resources, while not representing proportions of global reserves as important as those of other countries—for example Iran (the country with the 5th-largest proven oil reserves and the 2nd-largest proven natural-gas reserves) or Iraq (the country with the 4th-largest proven oil reserves and the 11th-largest proven natural-gas reserves)—is sufficient reason for different nations to have a geopolitical interest in Syria. There is, however, an even more important reason: Syria borders Iraq, and Iraq in turn borders Iran, as can be seen below:

    Figure 1
    Map of the Iran–Iraq–Syria gas pipeline.
    Source: (RT, Economía, 2017)

    As can be seen, the gas pipeline runs from the Iranian coast across the Iran–Iraq and Iraq–Syria borders until it reaches the Syrian coast. Its final purpose is to supply European consumers, as well as consumers in the countries through which the pipeline passes. Syria is therefore geopolitically fundamental: whoever controls that country controls the pipeline’s final outlet and, with it, the supply of natural gas to Europeans; if, in addition, Iraq and Iran are controlled, one has in hand one of the most profitable businesses a company could imagine.

    The matter does not end there. To move the oil extracted from any of these countries, one must also go around the entire Arabian Peninsula or around the entire African continent.

    Figure 2
    Map of oil and natural-gas infrastructure in Saudi Arabia and the surrounding region.
    Source: (EIA, 2017)

    Since Euclid, it has been known that the shortest distance between two points is a straight line. Construction of the Trans-Arabian Pipeline began in 1947 and was administered primarily by the U.S. company Bechtel[7]. The pipeline was originally intended to terminate in Haifa, which at the time lay within the British Mandate for Palestine; because of the establishment of the State of Israel, however, an alternative route through Syria was established, and Lebanon was selected for one of the export terminals at Sidon. As (Little, 2003, pp. 12–13) notes, the Syrian government initially opposed the plan but ratified construction of the pipeline in 1949 after a military coup overthrew the democratic government there, and oil transport through the pipeline finally began in 1950. This coup against the government of the day—which had been chosen through free elections—was promoted by the CIA, and authoritative voices such as (Massad, 2017)[8], (Little, 2003)[9], and even declassified CIA records confirm it. Although that pipeline is no longer strategically important today, it serves as a historical reference point for understanding who has continued to destabilize Syria and why, a matter that will be examined in greater depth below.

    Although the Trans-Arabian Pipeline is no longer strategically important in geopolitical terms, Syria certainly remains so, because going around the Arabian Peninsula and crossing the Suez Canal significantly increases transport costs and also the time required to realize oil as a commodity.

    Figure 3
    Map of oil infrastructure and routes associated with regional transport.
    Source: (Puzzle de la Historia, 2017)

    As can be seen, going around the Arabian Peninsula in order to reach the Suez Canal (where fees are paid) involves traveling 11,600 kilometers, while avoiding the Suez Canal requires going around Africa, a distance of 19,800 kilometers. To give the reader a sense of scale, traveling through the Suez Canal would amount to 22.3 times the distance between Paso Canoas and Peñas Blancas, while avoiding it would mean traveling 38.05 times that same distance[10].

    Would it not be simpler to trade the oil if it could be taken out in a straight line through Syria? The answer is yes. Doing so, however, would require political control of Syria. This makes the country a fundamental geopolitical point, because whoever controls Syria will control not only those reserves of natural resources—oil and natural gas—but also the most efficient commercial route for placing them in Western markets.

    This highly strategic commercial position—in terms of any commodity, not only oil and natural gas—has made Syria desirable to various empires throughout world history, from the Persians and Greeks, through the Romans, and ultimately the Turks.

    Let us reconstruct some of that history in order to see the political evolution of the territory now known as Syria and thereby understand both the reasons for its relatively recent emergence as a nation-state and the climate of instability that has arisen within it and in its surroundings.

    The Roman Empire underwent an administrative division initiated with the tetrarchy[11] of Emperor Diocletian (284–305) and consolidated by Emperor Theodosius I (379–395), who divided it between his two sons: Arcadius became emperor of the East and Honorius emperor of the West. What remained of the Roman Empire after Odoacer (King of the Heruli) deposed the last Western Roman emperor (Romulus Augustulus) in 476 was conquered by Islam, becoming the Ottoman Empire[12] on May 29, 1453. The Ottoman Empire would then endure until the First World War (WWI).

    After WWI, small countries appeared on the map for the first time, among them Syria on September 1, 1918. Like every historical event, this occurrence was not arbitrary. As with the emergence of Iraq, Jordan, and others, it resulted from the fact that the French and British could not defeat the Ottoman Empire alone, making it necessary not only to ally with one another but also to secure the support of civilians residing within the empire. To win their favor, they promised them “Greater Palestine,” that is, a single nation for all Arabs.

    In secret, however, France and the United Kingdom concluded the Sykes–Picot Agreement[13], which consisted of distributing the geopolitical control they would exercise over the territory occupied by the Ottoman Empire in the event that they won the war. Napoleon is said somewhere to have remarked that, if one wished to succeed in politics, the key was to promise everything and fulfill nothing; that is precisely what the Europeans did, and the promise of a single nation for all Arabs was never fulfilled. Instead, as part of a distribution of Ottoman territory among the European powers of the time, they created many relatively small nation-states.

    Figure 4
    Map of the Sykes–Picot Agreement of May 1916.
    Source: (Encyclopædia Britannica, 2017)

    It was in this context, after the victory of the European nations, that Syria appeared and came under French control, a state of affairs that lasted until the end of the Second World War (WWII).

    As reported in (U.S. Department of the Army, 2017), shortly after the end of WWII, during 1944 the Syrian government assumed the functions of fourteen administrative departments that had been under direct French control since 1920. These included departments responsible for matters such as customs, social affairs, excise taxes, supervision of concessionary companies, and oversight of tribes. France retained control of social, cultural, and educational services, as well as the Levant Special Forces[14], which were used for security purposes. Despite French opposition, the Soviet Union in July and the United States in September 1944 granted Syria and Lebanon unconditional recognition as sovereign states; British recognition followed a year later. These Allied nations pressured France to evacuate Syria.

    The new Syrian government demanded the immediate and unconditional transfer of the Levant special troops to Syrian control or their dissolution, and threatened to form a national army unless that step was taken. France, however, made the withdrawal of the troops conditional on Syria signing a treaty that would assign France a privileged position in the country.

    In January 1945, the Syrian government announced the formation of a national army, and in February it declared war on the Axis powers (principally Germany, Italy, and Japan). In March, the country became a founding member of the United Nations (UN), an indication of its sovereign status, and in April it affirmed its commitment to the idea of Arab unity by signing the Arab League pact.

    Before introducing Israel’s role in Syria’s historical and current situation, it is necessary to discuss the ideological-religious conflicts in the region.

    Shortly after the end of WWII, the Arab Socialist Ba’ath Party was founded, hereafter referred to as BA’ATH in reference to the ideology of this pan-Arab party, which combined the old aspirations for a single Palestinian nation with a secular ideology and socialist foundations. It came to power in 1963 in Syria and Iraq; the Syrian and Iraqi factions of the BA’ATH clashed in 1966 and thereafter acted independently. This produced an ideological fragmentation in the region, dividing it essentially into two blocs: Syria’s allies and Iraq’s allies.

    Shortly before the BA’ATH came to power, Syria united with Egypt (with which it did not even share a border) to form the United Arab Republic between 1958 and 1961. The alliance did not last long, but it endured long enough for Egypt to persuade Syria to nationalize its natural resources. The failure of this union was not due to random or arbitrary factors either. In 1961 there was a coup d’état in Syria sponsored by the radical Syrian army, after which the country and its population endured a tyrannical government for two years; another coup followed in 1963, the one in which the BA’ATH took power in both Syria and Iraq in that same year.

    In this 1963 coup, Háfez al-Assad appeared for the first time as a political figure and became head of the BA’ATH State; the same occurred in Iraq with Saddam Hussein, also a member of the BA’ATH Party. With the Cold War, which began in 1947, Syria aligned itself with the Soviet Union, while a recently created nation-state aligned itself with NATO. Israel must now be introduced into the international setting.

    Between 1936 and 1939, a revolt took place in the Palestinian territories controlled by the United Kingdom—those formed after the defeat of the Ottoman Empire—whose cause was protest against Jewish immigration, since Arabs and Jews possessed ideological-religious differences that were irreconcilable within the framework of Middle Eastern culture. The revolt arose because of the United Kingdom’s consent to Jewish immigration into Palestinian territories[15] and its refusal to hold democratic elections to decide the future of the Jews. Since Palestinians had historically occupied those territories for centuries, they possessed an overwhelming demographic majority that would have resolved the elections in their favor.

    Thus, after the French and British withdrew from what had formerly been Ottoman territory, and amid the ideological-religious conflicts between Palestinians and Jews in the area, the United Nations General Assembly met on November 29, 1947, following the report of the Peel Commission (which evaluated the causes of the conflict), and approved a plan dividing Palestine into two States. Curiously, the plan awarded 53.6% of the territory to the Jews and 48.7% to the Arabs, while determining that Jerusalem—which represented an area equivalent to 2.7%—would be a corpus separatum administered by the United Nations. The fact that, for political reasons (Israel would be a Western ally in the Middle East), the Jews were given lands that had been occupied by Palestinians for centuries, and that despite Palestinians making up 67% of the population compared with 33% represented by Jews, the latter were awarded a larger share of the territory, led the countries representing Palestine to intervene militarily in the territory assigned to the Jews two weeks after the UN resolution was adopted. Jerusalem subsequently ceased to be a corpus separatum and became the capital of the State of Israel, with the complicity and silence of its Western allies. According to Israeli professor David Grossman, this would later mean that “since 1967, those who set the agenda and benefit from the budgets (in Israel) are the right and the settlers, a small devout group that has kidnapped an entire nation and confiscated our future.” (Grossman, 2010).

    The foregoing caused Israel’s neighbors not to recognize it as a legitimate nation-state and, once the Europeans had departed, to attack Israel instead.

    Since then, through force and the complicity of the West, and since the artificial creation of the State of Israel, geographic changes have taken place in the proportion of territory occupied by Palestinians, as shown below.

    Figure 5
    Cartographic sequence showing territorial changes in Palestine from before 1948 through 2014.
    Source: (Miller, 2017)

    This problem extends beyond geography; it concerns the distribution of resources per capita and, with it, quality of life. We will now briefly examine the variation in population density from before 1948 to 2014.

    Given the geographic change undergone by Palestinian territory, and using the total-population figures from (Datosmacro, 2017) beginning in 1970, we can calculate changes in Palestine’s population density. According to (Simpson, 2017), before 1948 Palestinian territory covered 26,626 km.2 and had an estimated population of 1,061,270 inhabitants, equivalent to 39.86 inhabitants per square kilometer. If Palestinian territory became 48% of the original in 1947 with the UN resolution, then the territory would have amounted to 12,780.48 km.2; assuming that the population did not vary significantly during that period (and even if it did, there are insufficient data to perform the calculation), the resulting population density would have been 83.03. In 1967 Palestinian territory was only 22% of the original, equivalent to 5,857.72 km.2; given that by 1970 the Palestinian population had risen to 1,124,293, this would imply a population density of 191.93 inhabitants per square kilometer. Finally, in 2014 Palestinian territory was only 12% of the original, equivalent to 3,195.12 km.2, and with a population of 4,422,143 reported by the source cited above, the resulting density would be 1,384.03 inhabitants per square kilometer. This would imply an approximate increase in population density of 3,372.23%. It is not difficult to imagine the economic difficulties that this increase in demographic pressure has implied for the Palestinian people in terms of implementing social policies, income-distribution policies, and other related government actions, even without counting the destruction of wealth caused by the wars with Israel. Conversely, it is also not difficult to imagine the economic advantages this has afforded Israel, whose population, as seen above, was the minority occupying those territories, without yet considering the substantial financing provided by the United States to Israel in various political and social areas, including the war against the Palestinian people and against countries that do not align themselves with its interests, as detailed by (Sparrow, 2017). The United States also used economic leverage in the international arena: it was the country that contributed the most to UNESCO (22%) and withdrew that support from the institution after Palestine was admitted, as reported by (El Mundo, 2017).

    What have the industrialized powers done in the face of such a violation of the civil rights of the Palestinian population? Absolutely nothing. They have simply made requests that have no coercive force, leaving Israel free to comply with them or not; naturally, those requests have not been obeyed, while the blood of hundreds of victims has been shed. According to (TeleSUR, 2017), between April and May 1948—the first year of the State of Israel—the Israelis took several Arab cities under the UN partition plan, but on April 10 the first massacre by Jewish militiamen against 100 Palestinian peasants in the village of Deir Yassin was recorded, forcing thousands of Arab civilians to flee the region. In 1967, during the Six-Day War, which began on June 5, Israel militarily occupied the West Bank and Gaza Strip, Syria’s Golan Heights, and the Sinai Peninsula. During the military offensive, Mirage 3 aircraft of the Israeli army destroyed more than 400 Arab aircraft. Those battles reportedly left 776 Israelis dead, 2,563 wounded, and 15 prisoners. On the Arab side, there were at least 24,000 dead, 45,000 wounded, and 6,000 prisoners. Between 1975 and 1981, the number of deaths officially recorded by Palestinian and UN organizations was 170, although reports from human-rights organizations speak of more than 3,000 additional deaths not officially recorded.

    In 1982, the death toll rose sharply, with 11,275 deaths recorded in the Lebanon War, where the Zionist army under then Minister of Defense Ariel Sharon launched “Operation Peace for Galilee” on June 6, with the objective of destroying the Palestine Liberation Organization (PLO), which was concentrated in Beirut after being expelled from Jordan in 1970. In the Sabra and Shatila massacre, 675 Israeli soldiers, around 9,800 Syrian soldiers, and Palestinian militiamen died. Between 2000 and 2010, an estimated 7,342 Palestinians, mostly civilians, died as a result of bombings and land and sea attacks by the Israeli army. Finally, during Israel’s prolonged occupation of Palestine, more than 1,500 civilians died and 1,215 Palestinians were displaced because of the demolition of homes by Israeli authorities. In the Gaza Strip conflict, 86% of the dead were Palestinians.

    Ultimately, “Does the so-called international community exist? Is it anything more than a club of merchants, bankers, and warriors? Is it anything more than the stage name the United States adopts when it puts on theater?” (Galeano, 2017).

    Háfez al-Assad’s arrival in power did not alter the conflicts already present in the region, specifically between Syria and Israel. Later, with the Cold War placing the two countries in different ideological blocs, tensions intensified and Syria entered into an open war against Lebanon.

    Syria’s complications were not yet over, and the ideological frictions within the region were exploited by its allies. Before proceeding to describe that social fact, however, the genesis of the political-ideological factions among the Palestinian people will be introduced.

    Contrary to what is commonly assumed, Arabs are not necessarily Muslims, although most of them are. The following table presents this segmentation.

    Table 1
    Table showing the division between Shiite Islam and Sunni Islam and the political or armed factions mentioned in the article.
    Source: Author’s own elaboration.

    The proportion between Sunnis and Shiites is shown below.

    Figure 6
    Map of the Islamic world showing the proportions of Sunni and Shiite populations.
    Source: (RT, Sunitas y chiitas: ¿Qué es lo que los separa?, 2017)

    It is estimated that Sunnis account for roughly 80–90% and Shiites for 10–20%. In Syria, because Háfez al-Assad’s government belonged to the Shiite minority while governing a Sunni majority, strong opposition movements began to emerge and were suppressed by gunpowder and blood. This internal conflict in Syria was exploited by Sunni Islamists, who took up arms against Háfez al-Assad; once again, the revolt was put down at the cost of many lives. Háfez al-Assad died in 2000 and was succeeded by Bashar al-Assad.

    As (Rafizadeh, 2017) notes, once Bashar al-Assad came to power he proposed neoliberal-style economic openings with the goal of joining the World Trade Organization (WTO). These policies even led the United States to lift its opposition to Syria entering the organization, and with 153 members in favor, the WTO granted Syria observer status[16]. However, as the cited author observes, this economic reformism was not accompanied by income-redistribution policies (as is characteristic of the neoliberal model) and generated social unrest in the country. This forced the Syrian president to return to his father’s economic policies.

    Several years later, the “Arab Spring”[17] reached Syria. There, “dozens of people demonstrated in Dar’a in the south of the country demanding freedom, political reforms and action against corruption, peaceful acts controlled by the Syrian police without violent incidents. The march against the government was launched on Internet social networks and supported by thousands of people who backed a Syrian revolution against President Bashar al-Assad until freedom and justice were achieved, but mobilization in the streets was limited. In response, Al-Assad announced economic reforms, amnesty for prisoners, and greater Internet access. The situation of instability continued throughout 2011, attracting international attention and raising the possibility that the UN Security Council might impose sanctions similar to those applied to Libya.” (EcuRed, 2017).

    Some argue that the “Arab Spring” was a social movement sponsored by the United States to destabilize governments in the region that were not aligned with its interests, as investigative journalist Lee Stranahan put it: “When Barack Obama took office as president in 2008 with Hillary Clinton as Secretary of State, one of his first foreign-policy steps was his speech in Cairo, Egypt, where he stated, in the presence of members of the Muslim Brotherhood, that ‘a new era had begun in the U.S. attitude toward Islam’ (…) What followed was the wave of Arab Spring uprisings throughout the region, which, despite initially being regarded as ‘bold movements of people desperate for freedom,’ were in fact ‘a way for Islamists to dethrone the more secular military dictators of the region (…) The U.S. openly called for the overthrow of Al Assad despite the fact that it was clear that the outcome of this overthrow would be the seizure of control by Islamist groups (…) Syria proved resistant’ to Obama and Clinton’s regime-change efforts, even though the U.S. supplied weapons to the so-called ‘rebels’ that ultimately ended up in the hands of Islamist groups.” (Stranahan, 2017).

    Likewise, according to U.S. attorney John F. Kennedy Jr.: “Our war against Bashar al Assad did not begin with the peaceful civil protests of the Arab Spring in 2011, but in 2000, when Qatar offered to build a $10 billion gas pipeline through Saudi Arabia, Jordan, Syria, and Turkey.” (Kennedy, 2017).

    Julian Assange, founder of WikiLeaks, takes a similar line, stating: “The Syrian chapter goes back to 2006, when in a very important cable Ambassador Roebuck, based in Damascus, responds to a discussion about a plan to overthrow the Assad Government in Syria (…) When the United States needs to do something, it brings together the different arms of U.S. power, which include the military, Intelligence, finance, commerce, and its information power.” (Assange, 2015). Assange also states that “Within those military strategies, the journalist highlights the role of apparently civilian institutions, such as the National Endowment for Democracy (NED) and the United States Agency for International Development (USAID) (…) Assange also mentions the alignment of the International Monetary Fund (IMF) with Washington’s foreign policy when it comes to weakening or destabilizing countries through their finances.” (HISPANTV, 2017).

    One fact does not, of course, exclude the other. From the standpoint of Western conceptions of political philosophy, many countries in the region have unfinished business regarding the political freedoms they grant their citizens. After the democratic opening, however, Bashar revived his neoliberal policies by promoting privatizations in order to smooth relations with the United States and its allies, while making no concession to the opposition movement in Syria. Thus, despite his economic-liberalization policies, as (RPP Noticias, 2017) reports, the United States and the other aligned countries called for the Syrian president’s resignation, and Obama announced economic sanctions against Syria, including a prohibition on trade with the Arab country. In the words of the U.S. Department of State: “The United States government has repeatedly called on President Bashar al-Assad to step down and has led the efforts of the international community to work toward a negotiated political solution to the conflict.” (U.S. Department of State, 2017).

    In its attempts to overthrow Bashar al-Assad, the United States financed the creation of the Islamic State, according to Julian Assange: “Thus, for example, the disastrous intervention—absolutely disastrous—in Libya, the destruction of Gaddafi’s Government, which led to the occupation by Islamic State of large segments of that country, the flows of weapons going to Syria, guided by Hillary Clinton toward jihadists inside Syria, including Islamic State, are there in those emails. There are more than 1,700 emails from the Hillary Clinton collection that we have released on Libya alone.” (RT, 2017).

    In addition, the Obama administration allowed Islamic State to grow in the expectation that this would help force the overthrow of the Syrian president, as John Kerry stated at the time: “We knew that it (Daesh) was growing, we were watching, we saw Daesh strengthening and we thought that threatened Al-Assad (…) We thought that we could probably get Al-Assad to come and negotiate, but instead of negotiations we found that Al-Assad got Putin to support him (…) The Russians have intervened because they do not want to see a Daesh government […] Unfortunately, the Russians have changed the situation. They have changed the equation.” (RT, 2017).

    Figure 7
    Demographic map of Syria.
    Source: (Heritage for Peace, 2017)

    Ultimately, the reader should remember that 241 years ago the United States, France, and England were the United States, France, and England and governed themselves; 100 years ago, by contrast, Syria did not exist on the map, and 72 years ago it did not govern itself. Moreover, unlike the Western countries just mentioned, Syria never decided its own borders: they were decided for it on the basis of geopolitical convenience rather than criteria grounded in its economic, demographic, cultural, and social needs. The country therefore contains profound design errors—errors in its geographical architecture. It is difficult to imagine implementing social projects in a country such as Syria, where water exists only in a small part of the territory and where a desert of 200,000 square miles lies between the population and its sources of natural resources (as can be seen in Figure 7), according to (Encyclopædia Britannica, 2017). It is also a country that has continually been destabilized and even controlled by the principal powers of the West, and where a profound ideological-religious contradiction, combined with foreign interventionism, makes it extraordinarily difficult to achieve the minimum social and political cohesion required to move forward as a nation-state. It is therefore not surprising that the BA’ATH repeatedly uses repression to remain in power, or that this produces social eruptions that reach the level of civil war, as has occurred in various Western countries during the past century when they faced socioeconomic problems of far smaller magnitude than Syria’s.

    · · ·

    III · SectionWars as a Mechanism for Offsetting the Fall in the Average Rate of Profit

    “War, then, is not a relation of man to man, but of State to State, in which individuals are enemies only accidentally, not as men nor even as citizens, but as soldiers: not as members of their country, but as its defenders. Finally, a State can have as its enemy only another State, and not men, since between things of different natures no true relation can be established.” (Rousseau, 2007, p. 42).

    As Rousseau argues, wars set States against one another. In the first section of this research, however, it was shown that States respond to the interests of the dominant class at each specific stage of historical-social development. When two nation-states confront one another, what lies behind the conflict is a confrontation between the interests of the dominant classes within each of them. The constant interventionism of the United States in Syria is not the product of chance or coincidence; rather, it obeys inexorable economic laws belonging to the capitalist mode of production, specifically the law of the tendency of the average rate of profit to fall.

    “(…) as the historical-natural process we call human society unfolds, Capitalism develops the productive forces to an unprecedented level and thereby generates an increase in the proportion of accumulated surplus value allocated to the acquisition of constant capital at the expense of the proportion allocated to variable capital (because technological innovation reduces necessary labor time and increases surplus labor time). Proportionally, however, the reduction in necessary labor time will be smaller than the increase in total capital or, what amounts to the same thing, increases in the rate of surplus value will be smaller than increases in total capital, and thus a downward tendency in the average rate of profit will emerge, which Marx called the law of the tendency of the rate of profit to fall.” (Gómez, 2017, pp. 51–52)

    In weighted-average terms, the foregoing means simply that the technological innovations undertaken by capitalist firms will not proportionally offset the increase in total investment and, consequently, the average rate of profit will tend downward. There are, however, counteracting causes that turn the law into a law of tendency. In Marx’s words: “(…) we see that instead of the difficulty with which economists have hitherto struggled, namely explaining the fall in the rate of profit, the inverse difficulty arises: explaining why this fall is not greater or more rapid. This is undoubtedly due to the play of influences that counteract and neutralize the effects of this general law, giving it merely the character of a tendency, which is why we present the fall in the general rate of profit here simply as a tendency to fall.” (Marx, Capital, Volume III, 2010, p. 232).

    Marx enumerated the most general causes that make the fall in profit a tendential law: an increase in the degree of exploitation of labor (the intensity and/or duration of the working day), a reduction of wages below their value (below the value of labor power), the cheapening of the elements that make up constant capital (fixed capital and intermediate consumption), relative overpopulation (the role played by the mass of unemployed workers in wage determination), foreign trade, and the increase in share capital (which generates dividends).

    Despite these counteracting causes, however, the fall in the rate of profit asserts itself tendentially, as shown below.

    Figure 8
    Chart showing the downward tendency of the average rate of profit.
    Source: Author’s own elaboration based on (Marquetti & Foley, 2017).

    Although capitalism has been the first socioeconomic formation (SEF) to exhibit cyclical crises and to make use of elements foreign to the essence of its economic philosophy, it has also shown an enormous capacity to reinvent itself and recover. In this sense, it has increasingly and more clearly employed mechanisms that were previously less prominent—for example, wars.

    Figure 9
    Chart of Kondratiev long waves and cycles of prosperity.
    Source: (Allianz Global Investors, 2017)

    Figure 9 shows a Kondratiev long wave, named after the economist Nikolai Kondratiev, who argued that the capitalist economic cycle as a whole follows periodic fluctuations in economic activity that can be represented as waves. Each wave has different stages. The starting point represents the beginning of economic activity, which expands until it reaches a peak; after that, markets become saturated as a result of overproduction (production greater than what the market, given a particular level of purchasing power, can absorb), causing capitalist economies to slow until they reach what we now know as financial crises.

    In Kondratiev’s words: “It is generally recognized today that the dynamics of economic life under the capitalist social order are not simple and linear in character, but rather complex and cyclical. Nevertheless, science has clarified very little about the nature and types of cyclical movements, which resemble oscillations. When we speak of cycles in economics, we generally refer to cycles of activity lasting seven to eleven years. But it is evident that these movements are not the final type of economic cycle. In reality, the dynamics of economic life are more complicated. In addition to the cycles already mentioned, which we shall agree to call ‘intermediate,’ it has recently been shown that the existence of still shorter oscillations, lasting approximately three and a half years, is probable. But this is not all. There are real grounds for supposing the existence of large oscillations of approximately fifty years in the capitalist economy, a fact that makes the problem of economic dynamics even more complex.” (Kondrátiev, 2017)

    Kondratiev is referring here to the three principal cycles of economic activity: Kitchin cycles (short duration), Juglar cycles (intermediate duration), and Kondratiev cycles (long duration). This section will focus on the latter, the long cycles.

    It is true that Kondratiev’s analysis is rough and relatively mechanical because it lacks a prior theoretical formulation. This leaves him unable to establish precise duration intervals for the long waves or explain the causes of those intervals; nor does it allow him to examine deeply either the reasons that give rise to crises or those that permit capitalist economies to recover, much less the causes of the point-to-point transition within the wave. Nevertheless, it does provide a general idea of the behavior of economic activity and makes it possible to identify certain patterns of behavior that can be connected with what has been developed throughout this research.

    As can be seen in Figure 9, each Kondratiev cycle has corresponded to some technological revolution. The expansionary phase begins once the innovation is introduced and, as a snowball effect develops—that is, as the innovation spreads beyond the innovating firm to imitating firms—economic activity flourishes. Once all sectors of the economy, or at least the most important ones, have adopted the innovation and produced what their production-possibility frontier permits, the economy stagnates. After some time, stagnation gives way to slowdown and finally to economic recession. It can also be seen how a new technological revolution begins the recovery and opens the curtain on a new phase, or wave, of the economic cycle. Statistically speaking, these long waves have been found to last between forty and sixty years, tending more toward the upper than the lower limit.

    What Kondratiev proves unable to explain, however, is why economic crises become deeper as the economic cycle advances. Nor does he explain why it becomes more difficult to emerge from them, or the consequences this has for the average rate of profit, capital accumulation, and competition. In general terms, this can be explained by the fact that as capitalist economies develop—and with them technological development—it becomes increasingly difficult to carry out revolutions in production techniques. Among other factors, competition forces firms constantly to introduce small innovations; as society reaches a given degree of development of its productive forces, these become increasingly costly (as explained above) and their impact on the average rate of profit becomes progressively smaller. At the same time, every SEF has shown insurmountable limits to its capacity for technological innovation. For primitive communities, for example, it would have been impossible to construct the carriages and armor produced by the Roman Empire under the slave mode of production, just as it would have been impossible for the Romans to conceive the construction of mills powered by water or wind, and for those societies in turn to discover nuclear energy. What does this mean? Simply that as historical-social development advances, each mode of production gradually exhausts its capacity for technological innovation, which also means that technological revolutions become increasingly less close at hand.

    The foregoing has two fundamental consequences. The first is an intensification of the downward tendency of the average rate of profit; the second is the centralization of capital, that is, the deepening of inefficient and weakly competitive market structures such as monopolies, monopsonies, oligopolies, oligopsonies, and others. This in turn has important effects on capital accumulation. The most important is that market structures lacking efficiency and competitiveness move away from the average rate of profit because their profit margins rise as a result of their market power[18], while firms with an average level of technology simultaneously see their rate of profit fall and firms with below-average technology are penalized by competition through bankruptcy and are absorbed by other firms, generally those with greater market power. This economic phenomenon occurs because technological innovations, for the reasons already discussed, become increasingly costly.

    The matter does not end there, because market structures to which the average rate of profit does not apply and which possess significant market power—for example, monopolies—are free to slow technological innovation because they do not face competition[19]. In this way they move still farther from the downward tendency of the average rate of profit, since their profit margins are above the average. It is not uncommon to observe, for example, that monopoly profit rates tend to rise during financial crises while the average rate of profit plummets.

    It might seem that these kinds of market structures, which promote inefficiency and lack of competitiveness, are an economic alchemy for capitalist firms. Since Adam Smith, however, economic science has understood the inverse relationship between wages and profits. Consequently, the measures by which firms distance themselves from the fall in the average rate of profit can only be possible at the cost of implementing the factors mentioned earlier by Marx. There is various evidence of this. One recent example occurred in France, an industrialized economy whose large companies were nevertheless forced to introduce greater flexibility into the labor market. Actions of this type by those operating within such market structures generate social discontent and, on many occasions, large generalized protests, as reported by (Yárnoz, 2017), one of which ended with 60 French people detained and 40 injured in a single day.

    There is, of course, a palliative measure for this problem which, while not representing a definitive solution, contributes to slowing the natural course of economic laws: wars.

    Figure 10
    Chart of a Kondratiev wave with wars and economic cycles.
    Source: (Kondratieff Winter, 2017)

    As can be seen, wars have played a major role in the recovery of capitalist economies when they have gone through crises of overproduction. This is clearly not a new phenomenon: it can be observed at least as far back as 1812, when capitalism had existed for only 23 years if its political establishment in France is dated to the storming of the Bastille in 1789. What explains this? The answer is quite simple. Part of the unemployed labor force leaves the economy, which raises wages (given the resulting shifts in the labor-supply curve, holding labor demand constant); purchasing power therefore rises and production is stimulated again. In addition, many unemployed workers die in war (so firms do not have to pay severance compensation, for example), while the Government assumes responsibility for subsidizing their families (with taxes paid by those same families). The “benefits” of war for the economy do not end there. In many countries war destroys land and industry, reducing the stock of available fixed capital. Holding other factors constant, if demand for fixed capital remains unchanged while its supply declines, its market price rises. Machinery that had been undergoing depreciation as a result of use and new technologies therefore experiences a slowing of that process, which in turn slows the need for innovation. Finally, war itself promotes economic activity by activating industries closely linked to weapons manufacturing and even industries that benefit significantly from arms production. These factors lead to higher stock-market valuations for companies wholly or partly connected to this industry, because greater economic activity increases their profitability.

    Industries most closely linked to arms production are those that belong directly to the weapons industry. “These are the first 10 companies on the 2011 ranking (figures in parentheses correspond to the 2010 ranking):

    1 (1). Lockheed Martin (United States). Missile systems, electronics, and aerospace. Sales of $36.270 billion in 2011. Net profits: $2.655 billion. 123,000 employees (132,000).

    2 (3). Boeing (United States). Aircraft, electronics, missiles, aerospace. Sales of $31.830 billion. Net profits of $4.018 billion. 171,700 employees (160,500).

    3 (2). BAE Systems (United Kingdom). Aircraft, artillery, missiles, military vehicles, ships. Sales of $29.150 billion. Net profits of $2.349 billion. 93,500 employees (98,200).

    4 (5). General Dynamics (United States). Artillery, electronics. Sales of $23.760 billion. Net profits of $2.526 billion; 95,100 employees (90,000).

    5 (6). Raytheon (United States). Missiles, electronics. Sales of $22.470 billion. Net profits of $1.896 billion. 71,000 employees (72,400).

    6 (4). Northrop Grumman (United States). Aircraft, electronics, missiles, warships. Sales of $21.390 billion. Net profits of $2.118 billion. 72,500 employees (117,100).

    7 (7). EADS (EU). Aircraft, electronics, missiles. Sales of $16.390 billion. Net profits of $1.442 billion. 133,120 employees (121,690).

    8 (8). Finmeccanica (Italy). Aircraft, artillery vehicles, missiles. Sales of $14.560 billion. Net profits of $902 million. 70,470 employees (75,200).

    9 (9). L-3 Communications (United States). Electronics. Sales of $12.520 billion. Net profits of $956 million. 61,000 employees (63,000). 10 (10). United Technologies (United States). Aircraft, electronics, engines. Sales of $11.640 billion. Net profits of $5.347 billion. 199,900 employees (208,220).”

    Source: (Moreno, 2017)

    As can be seen, of the nine companies mentioned, six are American and the other three belong to countries allied with the United States. Even public officials can benefit from war, as has been the case with Donald Trump. According to (Boggioni, 2017), Trump owns shares in Raytheon, the company that manufactures Tomahawk missiles, and therefore benefited from having initiated the attack on Syria, because Raytheon’s shares appreciated, as can be seen below.

    Figure 11
    Screenshot of the Raytheon (RTN) stock quotation included in the article.
    Source: (Raytheon, 2017)

    Nor is the impact of wars on industries only partially connected with warfare negligible, such as steel producers, pharmaceutical companies, oil producers, among others.

    In modern times, oil is fundamental to all productive processes, while natural gas also plays an important role in combustion, to the point that many regard it as the fuel of the future. If to the foregoing we add the savings in transport and commercialization costs represented by the possibility of moving these resources out in a straight line (through Syria), the significant quantity of resources the country possesses, its geopolitically strategic position on the map, and the law of the tendency of the average rate of profit to fall, it becomes entirely natural to understand the reasons why the United States conducts its current foreign policies toward Syria.

    · · ·

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    Moreno, M. (April 15, 2017). Las diez empresas que más ganan con las guerras. Retrieved from El Blog Salmón: https://www.elblogsalmon.com/economia/las-diez-empresas-que-reciben-mas-beneficios-con-las-guerras

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    Article notes

    [1] This refers to Durkheim’s definition of a social fact, which consists of “Every way of acting, whether fixed or not, capable of exercising an external constraint upon the individual; or again, every way of acting which is general throughout a given society while at the same time existing in its own right, independently of its individual manifestations.” (Durkheim, 2009, p. 68).

    [2] In general, all sciences have as their ultimate aim the prediction of changes over time in their object of study.

    [3] Rousseau is referred to here; the other is Thomas Hobbes.

    [4] Of course, this is not a reference to a mechanistic approach in which the objective world determines the world of ideas. There is no doubt that the world of ideas has influence over and a capacity to transform the objective world, as Durkheim expressed. What is argued here is that, in the last instance, the material conditions of existence determine the world of ideas.

    [5] For further discussion, one may consult Engels’s The Origin of the Family, Private Property and the State, as well as Chapter XXIV of Volume I of Marx’s Capital, entitled “The So-Called Primitive Accumulation,” for the case of Europe, or Rafael Menjívar Larín’s Acumulación Originaria y Desarrollo del Capitalismo en El Salvador for the general case of Latin America.

    [6] Proven oil reserves are those that can be extracted profitably with current technology, taking into account the price of oil in the year being analyzed. These estimates are based on geological and engineering analyses, so the quantities established enjoy a high degree of confidence.

    [7] The largest construction and civil-engineering company in the United States.

    [8] Arab intellectual who serves as Professor of Modern Politics and History at Columbia University.

    [9] Professor of History at Clark University.

    [10] According to Google Maps, the distance between the two borders is 520.4 kilometers.

    [11] A form of government in which power is shared by four persons who call themselves tetrarchs.

    [12] Turks who conquered what is now known as Syria and its surroundings, founding that empire.

    [13] Its name derives from the fact that it was secretly negotiated by François Georges-Picot (a French diplomat and lawyer) and Mark Sykes (a lawyer by profession and member of the English nobility).

    [14] Military units formed during the period of the French Mandate in Syria, in addition to the Army of the Levant. These were French armed forces that occupied part of Western Asia between WWI and WWII and were composed of locally recruited personnel, who ultimately became the basis of the national armies of Syria and Lebanon.

    [15] Due in some measure to the persecution they suffered from the so-called “Axis of Evil,” composed principally of Germany, Italy, and Japan.

    [16] Countries that are in the process of negotiating their accession to the WTO.

    [17] “The name by which the media identified the series of popular and political demonstrations that took place in the Arab region mainly from the beginning of 2011 and led to the fall of the dictatorships of Ben Ali in Tunisia and Hosni Mubarak in Egypt, the intensification of violence in Yemen, and the civil war in Libya. Some international analysts have found points of similarity between the Arab Spring and anti-crisis demonstrations in Europe, Asia, and the United States.” (EcuRed, 2017).

    [18] When speaking of the existence of an average rate of profit, reference is made to a weighted average of sectoral rates of profit. The weighting factor is simply each firm’s share of the total capital existing in an economy—that is, the proportion that its investment represents of the total investment available to a society at a given moment in time. The existence of this average rate does not presuppose a static economy; on the contrary, it arises from the very economic dynamic by which capitalist firms rapidly migrate from one productive branch to another over time in search of the highest profit margins for their investments. It is precisely this process that produces an approximate equalization of sectoral profit rates and thereby makes the existence of the average rate of profit possible.

    [19] In the case of market structures such as oligopolies, the issue can vary. Although most of the time they collude and behave as a monopoly, on some occasions they compete, and their analysis then becomes more similar to that of competitive market structures than to that of noncompetitive ones.

    End · 2017
  • ON THE NEGATIVE BINOMIAL 2 DISTRIBUTION

    ON THE NEGATIVE BINOMIAL 2 DISTRIBUTION

    Probability · Count Data · Hierarchical Models

    When Counts Refuse to Behave: Understanding the Negative Binomial II as a Measurement Instrument

    A guided reading of José Mauricio Gómez Julián’s 2020 essay Some Reflections on the Negative Binomial Distribution II as a Measurement Instrument—tracing the argument from geometric series and probability mixtures to overdispersion, latent heterogeneity, and simulation in R.

    Mauricio Gómez Julián · Theoretical & Applied Probability · Approx. 15-minute read
    Reading note. This essay explains the paper on its own terms while keeping the mathematics technically precise. Where a qualification is needed—especially in the passage from an exponential mixing distribution to the general Negative Binomial II—it is marked explicitly rather than silently altering the paper’s argument.

    The question behind the paper

    Count data appear everywhere. An economist counts firm failures, strikes, defaults, patents, accidents, or entries into a market. A political scientist counts protests, cabinet changes, violent events, legislative vetoes, or international disputes. A biologist counts surviving organisms, mutations, infections, or offspring. The elementary model for many such problems is the Poisson distribution. But real counts often fluctuate more than a Poisson model allows. Their variance is larger than their mean: the data are overdispersed.

    The Negative Binomial II—usually abbreviated NB2—is one of the central statistical instruments for precisely that situation. Yet Gómez Julián’s paper is not content to present the NB2 probability mass function, list its moments, and move on. Its organizing question is broader: what kind of object is a probability distribution, where does it come from, what other distributions does it contain or presuppose, and what is gained when we understand its construction rather than merely its final formula?

    The paper therefore has two explicit axes. The first, and more important one, studies NB2 as the outcome of a wider theoretical structure involving hierarchical models and probability mixtures. The second studies NB2 as an individual distribution—its form, interpretation, moments, and practical use, including hand calculations and R. The intended unity between these axes is philosophical as well as mathematical: probability distributions are treated as instruments for measuring natural and social phenomena under uncertainty, and the paper argues that their history, formal structure, scientific interpretation, and application should not be torn apart.

    The distribution is easier to understand when we see not only the finished formula, but also the process that produces it.
    · · ·

    Why begin with the geometric series?

    The paper begins surprisingly far away from count-data regression: with the geometric series, its historical roots, and its relation to the binomial theorem. This is deliberate. Gómez Julián wants the reader to see the Negative Binomial II as part of a mathematical genealogy rather than as a formula that appeared fully formed.

    The route is roughly this: the geometric series provides a simple infinite expansion; differentiation exposes a recurring combinatorial pattern; that pattern is used to motivate the binomial expansion; and replacing the ordinary exponent with a negative one leads to the negative binomial series. The point is not merely algebraic. The paper repeatedly emphasizes the movement from simpler structures to more general ones and from one family of mathematical objects to another.

    1 + x + x2 + x3 + ··· = 1 / (1 − x),   |x| < 1 binomial expansion negative binomial series The paper’s algebraic genealogy in compressed form

    For a nontechnical reader, the important idea is simple: a probability distribution can be understood through the transformations and relationships that generate it. The paper later reinforces this visually with a large network diagram of probability distributions, reproduced from ProbOnto, in which distributions are connected by transformations, limiting relations, and special cases. NB2 is therefore presented as one node in a densely connected mathematical ecology, not as an isolated technique.

    Probability as a measurement problem

    Before building the NB2, the paper stops to ask what “probability” means. This is not a decorative philosophical detour. Gómez Julián’s position is that formal probability calculus and philosophical interpretation cannot be completely divorced, because statistical conclusions depend on what we think probabilities are measuring and on how the scientific problem is conceptualized.

    The paper adopts an explicitly objective and dialectical-materialist orientation. Randomness is treated primarily as an epistemological condition: events appear random because their causes are unknown, too numerous, or too complicated to represent completely. At the same time, the Kolmogorov axioms provide the formal mathematical framework that makes probability calculations coherent. The paper also draws on objective Bayesianism to argue that degrees of belief should be constrained by evidence, scientific theory, and the probability calculus rather than reduced to arbitrary personal opinion.

    Why this matters statistically

    A model is not chosen only because its formula is convenient. The scientific description of the process determines which random variables, conditional relationships, latent quantities, and parameterizations are meaningful. That principle becomes concrete once the paper turns to hierarchical models.

    A family, not an isolated formula

    The paper next introduces the distributions needed for its construction: Bernoulli, Binomial, Poisson, and Exponential. Each plays a distinct role.

    Distribution Plain-language role Role in the paper
    Bernoulli One trial with two possible outcomes. The elementary unit from which repeated success/failure experiments are built.
    Binomial Counts successes in a fixed number of Bernoulli trials. The first level of the hierarchical construction.
    Poisson Counts occurrences when events arrive with a given mean rate. Makes the number of opportunities or events itself random.
    Exponential Models waiting time or positive continuous variation associated with a Poisson process. Introduces variation in the Poisson rate across observational units.

    This sequence already contains the paper’s methodological intuition. A complex phenomenon can be decomposed into simpler probabilistic stages, each corresponding to a different part of the scientific story. Instead of forcing all uncertainty into a single flat formula, a hierarchical model lets uncertainty enter at more than one level.

    Hierarchies, mixtures, and latent variables

    A hierarchical model specifies variables and parameters in stages. A mixture model appears when a parameter in one probability distribution is itself treated as a random quantity governed by another distribution. The parameter that seemed fixed at the lower level becomes variable at the higher level.

    That is the key conceptual move in the paper. It is also why Gómez Julián brings in the language of latent variables: some of the forces producing observed variation may not be directly observed, but their consequences can still be represented probabilistically. In applied work, this is familiar. Two factories, municipalities, firms, hospitals, or individuals may face different underlying event rates even if we initially write one common Poisson equation for all of them.

    The paper links this mathematical construction to the Hegelian distinction between Being-in-itself and Being-for-itself. Stripped of the philosophical vocabulary, its statistical meaning is fairly intuitive. Studying NB2 “in itself” means studying the wider process and network of relationships from which it emerges. Studying NB2 “for itself” means taking the marginalized distribution as a distinct object and examining its own formula, parameters, moments, and applications.

    The first mixture: Binomial inside Poisson

    The first major construction uses a biological example. Imagine an insect that lays many eggs. Conditional on a mother having laid Y eggs, each egg survives independently with probability p. The number of surviving eggs, X, is therefore Binomial. But instead of fixing the number of eggs Y, the paper lets it vary according to a Poisson distribution with mean λ.

    X | Y ~ Binomial(Y, p)
    Y ~ Poisson(λ) First hierarchical model

    Marginalizing means asking for the distribution of X after summing out the intermediate variable Y. Algebraically, we combine all the possible values of Y, weighted by how probable each one is. The result is elegant:

    X ~ Poisson(λp) After marginalizing over Y

    In modern probability language, this is a version of Poisson thinning. If the total number of opportunities is Poisson and each opportunity independently survives with probability p, then the surviving count is also Poisson, with its mean reduced from λ to λp. The paper also derives the same conclusion through iterated expectations:

    E[X] = E{E[X | Y]} = E[pY] = pλ

    For the paper, this is more than a computational trick. It shows how a hierarchical process that appears to contain two random layers can be “compressed” into a simpler marginal law without erasing the scientific interpretation that motivated the hierarchy.

    When the Poisson rate itself varies

    The next step introduces another level of heterogeneity. Suppose there are many insect mothers, and the Poisson mean is not the same for every mother. The paper now treats the rate itself as random:

    X | Y ~ Binomial(Y, p)
    Y | Λ ~ Poisson(Λ)
    Λ ~ Exponential(β) Three-stage hierarchy in the paper

    The statistical intuition is important. Variation does not occur only in the observed count; it can also occur in the underlying rate that generates the count. Once the rate differs across observational units, the final distribution becomes more dispersed than a single-rate Poisson model. This is precisely the kind of latent heterogeneity that makes the negative binomial family useful in economics, epidemiology, demography, political science, and many other count-data settings.

    The paper shows that the mean of the full hierarchy can be obtained by repeatedly conditioning and averaging, arriving at E[X] = pβ under its parameterization. It then integrates out the random Poisson rate and identifies the resulting expression with the negative binomial form.

    Technical qualification added for accuracy

    There is an important distinction here. An Exponential distribution is a Gamma distribution with shape parameter equal to 1. Therefore, a Poisson–Exponential mixture produces the geometric distribution, which is a special case of the negative binomial with r = 1. The general NB2 with arbitrary dispersion parameter r arises from a Poisson–Gamma mixture. Thus, the paper’s core intuition—random heterogeneity in the Poisson rate generates negative-binomial-type overdispersion—is correct, but the fully general NB2 requires the Gamma mixing family rather than the Exponential distribution alone.

    This qualification actually sharpens the paper’s broader message. The geometric distribution, the exponential distribution, the gamma family, Poisson processes, and the negative binomial are not unrelated objects. They sit inside a network of special cases and mixture relationships. The more general Gamma mixing distribution preserves the same hierarchical logic while extending the model beyond the r = 1 case.

    · · ·

    The NB2 “for itself”: what the finished distribution tells us

    Once the hierarchy has been “compressed,” the paper turns to the Negative Binomial II as an object in its own right. One common parameterization writes the probability of observing x failures before the r-th success as:

    P(X = x) = Γ(x + r) / [Γ(r) Γ(x + 1)] · pr · (1 − p)x,   x = 0, 1, 2, …

    Here, p is the success probability and r is the target number of successes. The distribution answers a reversed version of the familiar Binomial question. The Binomial asks: how many successes occur in a fixed number of trials? The negative binomial asks: how many failures occur before a fixed number of successes is reached?

    The paper’s most important statistical property appears in its first two moments. With q = 1 − p:

    μ = E[X] = rq / p
    Var(X) = rq / p2 = μ + μ2/r

    That final equality is the bridge to modern count-data econometrics. The Poisson distribution imposes Var(X) = μ. NB2 allows:

    Var(X) = μ + αμ2,   where α = 1/r

    In other words, variance can grow faster than the mean. The smaller r is—or, equivalently, the larger the heterogeneity parameter α is—the more dispersion the model permits. As heterogeneity vanishes, NB2 approaches the Poisson benchmark. This is why the paper presents NB2 as a more flexible instrument for count data when the Poisson equality between mean and variance is too restrictive.

    Feature Poisson Negative Binomial II
    Mean μ μ
    Variance μ μ + αμ²
    Extra heterogeneity Not separately modeled Captured through α (or r)
    Typical use Equidispersed counts Overdispersed counts

    For an econometrician, this variance function is often the fastest route to understanding NB2. For a broader reader, an intuitive translation is enough: NB2 expects the world to be more uneven than a simple Poisson process. Some units have persistently higher event rates than others; unobserved conditions vary; clusters form; the same mean can coexist with much wider dispersion.

    The maintenance example: counting failures before the fourth alarm

    The paper gives a concrete industrial interpretation. Imagine fixed capital—a machine—producing parts. A part is either satisfactory or defective. A monitoring system treats a defective part as the event of interest because it signals the need for maintenance. Assume independent Bernoulli trials and a constant defect probability.

    Gómez Julián sets r = 4, p = 0.005, and asks for the probability of observing exactly x = 100 failures before the fourth success, using the negative binomial mass function. Substitution gives:

    P(X = 100 | r = 4, p = 0.005) ≈ 0.000067

    The number is tiny—about 6.7 chances in 100,000. The statistical interpretation is not that “100 failures happen and then four successes happen” as two separate blocks. Rather, among an ongoing sequence of independent trials, exactly 100 non-events occur before the fourth event of interest is reached.

    The paper checks the result manually, with a Texas Instruments calculator, and with R. It then plots the corresponding distribution, illustrating how a small success probability pushes substantial probability mass toward relatively large counts before the required number of successes is accumulated.

    What the R simulation is trying to show

    The final applied part of the main text shifts from evaluating a probability to generating pseudo-random data. The paper constructs a custom card-drawing experiment: repeatedly sample from a 52-card deck until a specified rank appears, record how many draws were required, and repeat the experiment many times. It then compares the histogram produced by that “from first principles” counting procedure with a histogram generated by R’s built-in rnbinom function.

    The figures for 50, 100, 150, and 200 repetitions show the same qualitative pattern: a strongly right-skewed count distribution with many small values and a long tail. The pedagogical purpose is clear. Software is not magic. A built-in random generator is implementing a probabilistic structure that can also be approximated through an explicit sequence of elementary trials.

    A convention to watch in R

    R’s rnbinom convention counts the number of failures before a specified number of successes. A hand-built routine that counts the total number of draws including the successful draw differs by one when size = 1. For an exact one-to-one comparison, the manual routine and the software call should use the same counting convention. This does not erase the pedagogical point of the simulation, but it matters for exact numerical equivalence.

    The broader lesson is useful far beyond R. Simulation can reveal what a distribution means operationally: not merely how its formula looks, but what repeated mechanism would generate data with that shape.

    NB1, Bayes, and the annexes: why the paper keeps widening the frame

    The annexes extend the same relational approach. The paper distinguishes NB2 from NB1, emphasizing that different negative-binomial parameterizations answer slightly different counting questions. In the NB1 presentation used there, the random variable is the total number of Bernoulli trials needed to reach r events of the chosen type; in the NB2 presentation, the random variable is restricted to the number of failures before those r successes.

    The paper also returns to conditional probability, total probability, inverse probability, and objective Bayesianism. This may seem far removed from overdispersed count data, but it serves the same philosophical thesis: statistical formulas must be understood through the relationships they encode. Conditional probability is not merely a ratio; it represents a structured dependence between events. Bayesian updating is not merely algebra; it connects prior knowledge, evidence, and posterior assessment.

    Finally, the paper gives a more general NB2 expression in terms of the Gamma function and reports estimators based on the first two sample moments. This again links the abstract distribution to empirical work: the population parameters acquire meaning only because sample information provides a route to estimation.

    What should we take away?

    Gómez Julián’s paper is best read as an extended argument against treating the Negative Binomial II as a black-box formula. Its distinctive contribution is not a new NB2 estimator or a new regression algorithm. It is an attempt to reconstruct the distribution through several layers at once: historical, algebraic, probabilistic, computational, applied, and philosophical.

    For the nontechnical reader, the central statistical lesson can be stated in one sentence: when counts vary more than a single-rate Poisson model permits, the extra variability can often be understood as heterogeneity in the underlying event rate, and the negative binomial family provides a natural way to represent it.

    For the econometrician, the key signature is the NB2 variance function, Var(Y) = μ + αμ². For the mathematician, the paper is an invitation to follow the transformations linking geometric series, binomial expansions, gamma functions, conditional distributions, and marginalization. For the philosopher of science, its central claim is methodological: the formal instrument, the scientific object, the history of the instrument, and the interpretation of uncertainty should be studied in relation rather than isolation.

    And for the applied researcher, perhaps the most useful question is the simplest one: what process would have to be operating for this distribution to be a sensible measurement instrument? Once that question is asked, NB2 stops being just a convenient correction for overdispersion. It becomes a hypothesis about how heterogeneity enters the data-generating process.

    A distribution is most informative when its probability law and its generating story tell the same scientific story.
    In one compact map

    Bernoulli gives the elementary success/failure trial; Binomial aggregates such trials at a fixed size; Poisson makes the number or rate of occurrences stochastic; Gamma heterogeneity lets that Poisson rate vary across units; marginalizing the latent rate yields the Negative Binomial II, whose variance can exceed its mean.

    This explainer follows the architecture and substantive aims of Gómez Julián’s paper while separating the paper’s own philosophical framing from the technical qualifications added here for mathematical precision.

    Read the Original Paper ↗
    Editorial-academic layout · Playfair Display · Lora · DM Mono
  • The Shape of a Crisis: A General Theory of Capitalist Cycles

    The Shape of a Crisis: A General Theory of Capitalist Cycles

    Thesis Release · Political Economy

    The Shape of a Crisis

    A general theory of the cycles of the dynamics of the capitalist system in the long run — now available in English

    Every few years the same story is told twice. First, that the economy has entered a new era in which the old rules no longer apply. Then, some months later, that what happened was an accident: a shock, a bubble, a virus, a war. Both tellings share a premise so quiet that it is rarely examined — that the rise and the fall are separate events, and that a good theory of the good years need not be a theory of the bad ones.

    The thesis released today argues the opposite, and then goes to some length to measure it. The boom and the crisis are not two phenomena but two moments of one: the crisis of overproduction is the mechanism by which capitalism restores the conditions of an accumulation that its own success had eroded. Devaluation clears the field; new methods of production are introduced under duress; profitability recovers on the ruins. The recovery is not the negation of the crisis. It is its product.

    That claim is old. What is new here is the attempt to make it decidable — to state it in a form that quarterly data on the United States economy between 1992 and 2024 could have contradicted, and then to check whether they do.

    Three questions, and why the order matters

    The investigation is organised around one general objective — to analyse the long-run cyclical behaviour of U.S. capitalism in the light of the dominant economic theories — and three specific ones, asked strictly in this order:

    • Which theory explains and predicts best? Not which is most elegant, or most widely taught, but which survives being pointed at the data.
    • Which factors generate the cycle? Economic and extra-economic alike — the thesis refuses in advance to treat wars and monetary policy as noise sitting outside a clean economic mechanism.
    • By which rules do those factors interact? A list of causes is not a theory. The theory is in the grammar that binds them.

    The order is not decorative. A great deal of applied economics answers the third question with machinery borrowed from a theory it never subjected to the first. Here the selection of the framework is itself a result, defended before it is used.

    Five families of an old argument

    Before measuring anything, the thesis maps the terrain. Economic thought on the cycle is sorted into five groups: the pre-Kondratieff non-heterodox schools; the Kondratieff school; the post-Kondratieff marginalist and neoclassical schools; the heterodox schools; and the historiographic vision of long waves, which reads the cycle through the archives rather than through the equations.

    With that map in hand, three long-running disputes are adjudicated rather than summarised. Does the crisis originate in overproduction or in underconsumption? Is a sustained expansion of credit a symptom of recovery, or of the exhaustion of the conditions that made recovery possible? Is there really an inverse relation between inflation and unemployment, or is the appearance of one an artefact of the precariousness of the labour market? Each is answered, and each answer carries consequences later, when the model is specified.

    A framework that states its own conditions of failure

    A substantial part of the theoretical apparatus is devoted to a materialist characterization of the dialectical method: its fundamental categories, a Marxist ontology built from a metalogical gnoseology, and an explicit treatment of verification, falsification and decidability. The purpose is unglamorous and indispensable — to fix, in advance, which propositions of the theory are empirically decidable and which are interpretive. Without that boundary, no amount of subsequent statistics can tell you what has been tested.

    Ten dials, seven of them internal

    The empirical core is a Bayesian generalized linear model of the growth of U.S. real output, estimated with Hamiltonian Monte Carlo and cross-validated against machine-learning and deep-learning competitors. It retains thirteen coefficients across ten factors. Seven are economic:

    FactorWhat it registers
    Net Average Rate of Profit (ARoP)The central variable of the accumulation process, and the one whose long-run tendency the theory predicts.
    Elasticity of the gross rate of surplus value to the average organic composition of capitalHow the exploitation of labour power responds when the technical structure of capital changes.
    Non-residential fixed investmentThe pace of accumulation in the productive sector; the hinge between boom and crisis.
    Inventory-to-sales ratioThe gap between producing value and realising it on the market.
    S&P 500Financialization, entering through a natural cubic spline with three degrees of freedom.
    Non-financial private sector creditThe credit system as the accelerator and the brake, splined with two degrees of freedom.
    Capitalist R&D spendingThe innovative impulse; the second largest coefficient in the model.

    And three are extra-economic: military spending (splined with three degrees of freedom), the federal surplus or deficit, and the effective federal funds rate. Their presence is not a concession to realism. It follows from the argument that an imperial economy counteracts the tendency of its own profit rate to fall by means that are not internal to its national accounts.

    The Average Rate of Profit carries the fourth largest coefficient of the thirteen — behind only the intercept, R&D spending, and one basis function of the splined S&P 500. The conclusion the author draws from its behaviour is worth quoting in substance: what is favourable to the global process of capital accumulation is not thereby favourable to the dynamics of aggregate growth. The two are not the same quantity, and treating them as one is precisely the confusion the cycle punishes.

    Note, too, what the splines are doing. Three of the ten factors would not sit still in a straight line. That is not a technical footnote: it is the first quantitative sign that the interaction of these factors involves thresholds and turning points rather than a stable proportionality.

    Not random. Chaotic.

    “Unpredictable” and “random” are not synonyms, and the difference decides what kind of science economics can be. A random system has no internal structure to find. A chaotic one is rigidly determined and still unpredictable at long horizons, because arbitrarily small differences in initial conditions grow exponentially apart.

    Three measurements place the U.S. economy in the second category. The Lyapunov exponent is positive (approximately $0.0515$): small perturbations amplify rather than dissipate. The correlation dimension is not an integer ($3.32798$): the attractor reconstructed by Takens’ theorem has a fractal structure, patterns repeating across scales of time and magnitude — which is what “cyclical, but not periodic” means when it is stated precisely. And recurrence quantification finds high determinism alongside variability in laminarity and in the maximum diagonal line length: underlying deterministic structures that themselves evolve.

    $\lambda > 0 \quad\text{with}\quad D_2 = 3.32798 \notin \mathbb{Z}$

    Read together, these say something a forecaster should find sobering and a theorist should find encouraging. The long-horizon forecast is not merely hard; it is structurally bounded. But the structure that bounds it is real, stable and measurable — which is exactly what a theory of the cycle needs to have something to explain.

    The shape of time

    The most unusual instrument in the thesis is topological. The idea is to stop asking how big the numbers are and start asking which observations can see which. Convert the series into a directed visibility graph — a link from one quarter to another when the second is visible from the first over the intervening data — and study the order structure that results.

    Two topologies are built on it, and they disagree in an informative way.

    • The coarser Alexandrov topology, built on temporal reachability, turns out to be connected. At the level of its order structure the economy is globally a single piece: every observation is bound to every other by chains of temporal visibility. There is no quarter that stands apart.
    • The finer Nada topology is locally fragmented — six components under the natural visibility graph, thirty-six under the horizontal one. Zoom in, and the fabric shows seams: structural discontinuities at the level of closed neighbourhoods.

    Global unity and local rupture at once. That duality is not a contradiction to be resolved; it is the object being described. And a third measurement gives the whole thing a direction: the bitopological analysis yields $D = +4$, meaning that expansions generate more temporal visibility than contractions. The cycle is not symmetric in time. Growth accumulates gradually and in view; collapse happens abruptly and blind. Run the film backwards and it is recognisably the wrong film.

    ⚠️ Why you must not “clean” the crises

    There is a habit in applied work of treating extreme values as contamination and smoothing them away by discontinuous imputation. Here that habit is shown to be a category error with a measurable price. The extreme fluctuations of the 2020 crisis belong to a connected block even under the finer topology; severing them is a topological rupture, not a cleaning operation. The thesis reports the consequence directly: models fitted after such imputation performed worse, because one was using predictors suited to one phenomenon — real output growth — to predict a qualitatively different one: real output growth after the crisis had been removed from it. The crises are not noise around the cycle. They are the cycle.

    The grammar of the cycle

    The third question receives a seven-part answer. The factors interact through feedback (the rate of profit shapes investment, investment shapes the organic composition of capital, which feeds back into the rate of profit); time lags (R&D and fixed investment pay out on a delay, and the delay is itself cycle-generating); non-linearity (thresholds and regime changes, which is why three factors needed splines); deterministic chaos; sectoral interdependence between the department producing means of production and the one producing means of consumption; topological structure, global connectedness with local fragmentation; and the influence of the global context, which is how military spending and the S&P 500 enter a nominally domestic account.

    The unifying claim is that each phase of the cycle contains the seed of its own negation. New methods of production introduced during the crisis lay the foundations of the next boom; the overaccumulation of the boom prepares the ground for the next crisis. Innovation initially arrests the fall of the profit rate and ultimately deepens it — through the way the degree of exploitation of labour power responds, over time, to the very methods introduced to raise it.

    What a cycle is for

    The thesis closes on a question most treatments never pose. If the cycle is a mechanism, what does it accomplish? Two answers, at different depths. Its intermediate practical end is to restart the process of capital accumulation once instability has reached a critical level — this the mechanism achieves, repeatedly, at a cost borne unevenly. Its definitive practical end is to lay the material and spiritual conditions for a reorganization of the fundamental productive structure of society, one capable of a stability beyond what the capitalist mode of production can reach within its own limits.

    What this establishes, and what it does not

    The evidence supports the claim that classical Marxist economic theory possesses the greatest explanatory and predictive capacity for long-run cycles among the theories examined here, on this economy, over this period. It is a comparative result on the United States between 1992 and 2024, quarterly — not a universal proof, and not a forecast. The thesis is explicit about the cost of its own data: the Average Rate of Profit and the average rate of surplus value were available only annually through 2020, and completing the series to 2024 required temporal disaggregation and prediction, which puts a wider band of uncertainty around the most recent quarters. The philosophical, historical, conceptual and statistical scope of each result is distinguished in the text, and results unfavourable to the hypotheses are reported alongside the favourable ones.

    About this edition

    This is the English edition of a thesis originally written in Spanish and submitted to the Universidad Latina de Costa Rica for the degree of Licentiate in Economics. It is interdisciplinary by construction, drawing on Marxist political economy, dialectical and historical materialism, the history and historiography of economic thought, the philosophy and methodology of science, econometrics, Bayesian statistics, the theory of complex systems and topology.

    The edition carries a Note on the Translation that fixes the rendering of the terms whose Spanish usage is technical and not interchangeable with their nearest English cognates — gnoseology, sublation, long wave, solvent demand, technique — and records the editions from which quotations are taken, including the two distinct English and Spanish editions of the Soviet philosophical dictionary, which are cited under different transliterations because they are different books with different pagination.

  • CAPITAL ACCUMULATION THROUGH DISPOSSESSION OF INDIGENOUS PEOPLE IN COSTA RICA

    CAPITAL ACCUMULATION THROUGH DISPOSSESSION OF INDIGENOUS PEOPLE IN COSTA RICA

    Costa Rica’s Democratic Myth: How Indigenous Dispossession Built the Country’s Agrarian Wealth
    Reading Notes · Political Economy · Latin American History

    Costa Rica’s Democratic Myth:
    How Indigenous Dispossession
    Built the Country’s Agrarian Wealth

    A plain-language reading of a groundbreaking study that dismantles the “White Legend” — and asks why a “democratic” state systematically violates the very rights it claims to protect.

    Based on: Gómez Julián, J. M. (2026). Revista de Historia, N.º 93, pp. 1–45.

    Costa Rica likes to think of itself as the exception. A small, peaceful republic nestled between two oceans, crowned with universal healthcare, no army since 1948, and a democratic tradition so stable that political scientists have called it the “Switzerland of Central America.” This flattering self-image — what scholars have long called the “White Legend” (Leyenda Blanca) — is one of the most durable stories in Latin American politics. It is also, according to a meticulous new study by Costa Rican economist José Mauricio Gómez Julián, profoundly misleading.

    Published in the Revista de Historia (University of Costa Rica, No. 93, 2026), the article sets out to do something ambitious: not merely to describe the well-documented inequality in Costa Rican land ownership — earlier scholars had already done that — but to explain why a formally democratic state produces, protects, and reproduces extreme agrarian concentration, generation after generation, and why the systematic violation of indigenous territorial rights is not an unfortunate glitch in the system but one of its operating mechanisms.

    The answer, the author argues, lies in understanding land dispossession not as a historical accident but as a structural feature of capital accumulation — a process that began with Spanish colonialism, was formalized by the liberal republic, was turbocharged by coffee and banana exports, and continues today under the twin guises of “conservation” and legal impunity.

    0.7258
    Gini coefficient for land concentration in Costa Rica’s southern region (Coto Brus). For context: 0 means perfect equality, 1 means one person owns everything. Sweden’s is around 0.53.

    The Numbers Behind the Myth

    Before we get to history, let’s sit with some uncomfortable statistics — the kind that rarely appear in Costa Rica’s tourism brochures.

    The Gini coefficient — the standard measure of inequality, where 0 is perfect equality and 1 is total concentration — tells a stark story. In Costa Rica’s southern region, land concentration reaches 0.7258. In Guanacaste’s cattle ranches, it climbs as high as 0.9. Nationally, the figure hovers around 0.796. For perspective: the top 1% of farms holds more than 37% of all agricultural land, while the bottom 39% of farms collectively own just 0.2%.

    And the people who work the land? Between two-thirds and three-quarters of Costa Rica’s agricultural workforce is landless — a proportion higher than anywhere else in Central America. In some regions like Coto Brus, more than 90% of farms lack legal titles.

    These figures are not from a radical pamphlet. They come from rigorous academic work by scholars like Mitchell Seligson, Marc Edelman, Charles Brockett, Jeffery Paige, and James Dunkerley — researchers who compared census data with actual property records and found that the state’s own statistics systematically underestimate the degree of concentration. Gómez Julián builds on their empirical foundation but adds a layer they largely did not: a categorical political-economic explanation of why this pattern persists within a formally democratic state.

    “Nearly three-quarters of the Costa Rican peasantry today are landless” — a fact that contradicts the national story of a country of small, equal farmers.

    A Timeline of Dispossession: From Encomienda to Enclave

    The article reconstructs the history of indigenous land loss in Costa Rica across five major phases. Each one reveals a different mechanism, but all serve the same structural function: clearing land and resources for capital accumulation.

    1. Colonial Foundations (pre-1821)

    Spanish conquest introduced three key instruments of dispossession: encomiendas (assigning indigenous labor to settlers), reducciones (forced resettlement into concentrated villages), and composiciones fraudulentas (legal maneuvers to convert indigenous land into colonial property). Roman law justified the entire operation by declaring indigenous lands to be property of the Spanish Crown. Though later laws like the Leyes Nuevas of 1542 formally attempted to protect indigenous peoples, the legislation on “vacant lands” (baldíos) declared as empty the very territories where indigenous communities lived, making them available for non-indigenous appropriation. By the end of the colonial period, a fragile but real legal recognition of “indigenous property” still existed through reducciones and “indigenous neighborhoods.” This legal floor is precisely what the post-colonial liberal state would systematically dismantle.

    2. The Liberal Republic Strikes (1821–1880)

    Independence did not bring recognition — it accelerated dispossession. In 1841, under the dictatorship of Braulio Carrillo, the Código General formally abolished the communal indigenous land regime as a protected legal category. Then, in 1882, Presidential Decree No. XIV declared vast stretches of northern territory — including the homeland of the Maleku people (historically called “Guatuso”) — to be baldíos: vacant state land open to appropriation by non-indigenous settlers and ranchers. The Maleku suffered what the article describes as one of the most intense proportional territorial and demographic reductions in Costa Rican indigenous history.

    1841
    Year the Código General, under dictator Braulio Carrillo, formally abolished communal indigenous land tenure — legalizing de facto what colonial expansion had already done.

    3. Coffee, the Beneficio, and Silent Proletarianization (1830–1930)

    The coffee boom created Costa Rica’s agrarian structure — and its contradictions. Unlike Guatemala or El Salvador, Costa Rica did not develop enormous haciendas. The largest farm was 604 hectares; the average was 41. By 1963, 58.5% of cultivated land was in units smaller than 35 hectares. This is the image the “White Legend” celebrates: a nation of smallholders.

    But the fine print tells a different story. Over 70% of the rural population was landless — a higher proportion than anywhere else in Central America. Power concentrated not through land-grabbing alone but through the beneficio (coffee-processing mill): in 1850, just sixteen beneficios controlled 85% of coffee exports, and access to the beneficio determined a small producer’s ability to finance and sell their crop. Credit systems tied small producers to merchant-landowners in relationships of dependency. Land prices inflated roughly twenty-fold in thirty years, incentivizing small producers to sell their parcels and then sell their labor.

    Critically, the Huetar people of Orosí resisted the coffee frontier around 1860 — an episode largely absent from standard histories of the coffee cycle. The “virtual absence of indigenous population” in the Central Valley during the great coffee expansion, which Dunkerley cited as one factor explaining Costa Rica’s distinct political development, was not a pre-existing geographic condition. It was, the article argues, the result of colonial epidemics (severe die-offs between 1576 and 1581), the legal dissolution of communal landholding in the 19th century, and physical displacement in the face of the advancing coffee frontier.

    4. Bananas, the Atlantic Enclave, and the Displacement of the Bribri and Cabécar (1870–1940)

    On Costa Rica’s Caribbean side, a parallel story unfolded — this one driven by foreign capital. The Soto-Keith Contract of 1883 granted Minor Keith 800,000 acres of state land, a 99-year railway lease, and sweeping tax exemptions. By 1890, his operation was the largest banana producer on Earth. The standard narrative presents this as development on “vacant land.”

    It was not. The Bribri and Cabécar peoples who inhabited the Talamanca valley were forced to move inland, deeper into their ancestral territory, because the banana concession included a significant portion of indigenous lands along the Sixaola river basin. The article calls this one of the key regional mediations of the dispossession process: the banana enclave was not merely a deal between a state and a transnational — it was a concrete mechanism of indigenous dispossession, legally articulated through the fiction of the baldío and materially executed through corporate control of Caribbean space.

    The United Fruit Company (UFCO) would later reduce its Atlantic plantations, face a major strike in 1934, and eventually shift production to the Pacific after the sigatoka disease devastated crops in 1938. But the damage was done: the “absence of indigenous population” in banana-region analyses reproduces, with different words, the same ideological device that operates in the coffee narrative — it naturalizes absence by hiding the dispossession that produced it.

    5. Limited Reform, Titulación, and the Persistence of Inequality (1957–1990)

    Costa Rica did attempt reform. International Convention 107 of the ILO (approved domestically in 1959) recognized indigenous and tribal peoples’ rights. Law 2825 of 1961 repealed the baldíos framework and declared such lands “state property” grounded in the social function of ownership. The Indigenous Law of 1977 (Law 6172) reserved portions of territory for indigenous peoples and granted full legal capacity to their communities through Asociaciones de Desarrollo Integral (ADIs).

    Yet the contradictions were glaring. The 1961 law allowed expropriation of idle land but required cash payment at market value — a provision that severely limited implementation. By 1970, only 1,272 families had been settled on roughly 35,400 hectares. The titling program backed by USAID reached a partial result of about 20,462 titles (some 339,761 hectares) by September 1979, at a rate of 425 titles per month against a theoretical capacity of 900–1,000.

    The results were telling. After receiving a title, the proportion of beneficiaries with access to credit rose from 18% to 31.7% — but the Gini coefficient for titled land was about 0.708, and when all land possessed by beneficiaries (titled plus other holdings) was included, it rose to nearly 0.781, almost identical to the national figure. Titling did not correct structural inequality — it potentially consolidated it. As the article puts it: these programs reached only a fraction of landless families while maintaining the fundamental structures of concentration.

    “Titling does not correct structural inequality and may consolidate it.”

    Conservation as Dispossession: The Modern Face of an Old Story

    One of the most striking arguments in the article is that the Costa Rican state itself — not just private ranchers or transnational corporations — has become a primary agent of indigenous dispossession, and it has done so wearing the respectable clothes of environmentalism.

    In 1982, Costa Rica created the Parque Internacional La Amistad (PILA), which was recognized as a UNESCO Biosphere Reserve that same year and as a World Heritage Site in 1983. What the celebratory narrative omits is that the park appropriated, as state-managed protected area, significant extensions of ancestral territory claimed by the Bribri and Cabécar peoples — without prior, free, and informed consultation. Its buffer zone includes the indigenous territories of Ujarrás, Salitre, and Cabagra. Inside the Biosphere Reserve, sixteen indigenous territories of five different peoples are situated. The state thus re-emerged, in this phase, as the principal agent of dispossession, this time through the legal figure of conservation.

    A similar dynamic operates through the Pago por Servicios Ambientales (PSA) — Costa Rica’s flagship Payment for Environmental Services program, administered by FONAFIFO. As documented by researcher Vargas Mena, the PSA has operated inside officially recognized indigenous territories. The forest, the water, and even the air (in the form of the carbon market) are commodified as “environmental services” whose monetary yield flows out of indigenous territory or is captured through institutional mechanisms that subordinate community decisions to the timelines and requirements of external agencies. This is not, the article argues, a correction of agrarian capitalism — it is a new phase of it.

    Add to this the contemporary presence of pineapple and palm oil multinationals in the southern zone, whose expansion encroaches on Bróráni, Bribri, and Cabécar territories. Their externalities — intensive water use, agrochemical contamination, pressure on adjacent lands — operate as mechanisms of environmental and economic dispossession on indigenous communities.

    16
    Indigenous territories of five different peoples situated inside the PILA Biosphere Reserve — appropriated without prior, free, and informed consultation.

    Recovering What Was Lost — and Dying for It (2011–Present)

    Faced with the persistent failure of the state to enforce legally recognized rights, indigenous movements launched what they call recuperaciones de facto: community-led recoveries of territories formally inscribed under the ADIs but materially usurped by non-indigenous occupants. Beginning in 2011 in places like Salitre, Cabagra, and Térraba, these recoveries triggered the organized, violent reaction of ranchers determined to suppress them.

    The consequences have been lethal. On March 18, 2019, Bribri leader Sergio Rojas Ortiz was assassinated. On February 24, 2020, Brórán leader Jethy Rivera was killed. Both murders occurred despite the existence of precautionary measures from the Inter-American Commission on Human Rights (Measure 321-12, issued in 2015). The impunity has been near-total: the Rojas case was archived in January 2024 with no detained suspects. In the Rivera case, the material perpetrator was initially convicted in February 2023, but the appellate court in Cartago reversed that conviction in July 2023, and in a second trial in August–September 2024, the accused was acquitted — despite his confession — under the principle of in dubio pro reo.

    The UN Special Rapporteur on the Rights of Indigenous Peoples documented that these attacks remain unpunished, with Costa Rican authorities failing to investigate even when perpetrators are known to the community. The cycle of dispossession–resistance–repression, the article argues, reveals that the de facto recoveries are not isolated incidents but the empirical manifestation of an ongoing class struggle over the means of production, mediated by a persistent colonial condition.

    “The contemporary accumulation by dispossession requires the same extra-economic violence that Marx identified in primitive accumulation.”

    A Broader Pattern: The State Always Chooses Sides

    The indigenous story does not exist in isolation. The article places it within a broader pattern of how the Costa Rican state has responded to rural land conflicts throughout its modern history — and the answer is consistent: it favors capital.

    The 1983 crisis is emblematic. When United Brands announced it was leaving, the state bought its land at $35,000 per hectare — a price that demonstrated the state’s weakness vis-à-vis transnationals. Standard Fruit demanded $200 million in credits and fired 700 workers. In the first eighteen months of the Monge administration alone, 185 rural conflicts were registered. In July 1983, 3,500 hectares of United Brands land were occupied by union militants and campesino federation members — and they were evicted by 600 police officers.

    Land occupations surged across administrations: 70 under Trejos, 500 during the Figueres (second) and Oduber governments, 120 in Carazo’s first year alone. The “land question” was never limited to Guanacaste, where cattle-ranching concentration had always been extreme and conflictive — it was a national structural feature.

    Rebuilding Political Categories from the Ground Up

    Here is where the article makes its most ambitious theoretical move. Rather than importing Marxist categories as ready-made tools, Gómez Julián claims to reconstruct them inductively from the historical evidence itself. The sequence is deliberate: facts first, categories second, return to facts with new interpretive power third.

    The State, in class societies, is the social organization of the political power of the economically dominant class. Law is the system of enforceable norms established by state power — it is the legal organization of that political power. Government is the administration of state institutions, and crucially, the economically dominant class is not necessarily the governing class: those who hold power are not always those who administer it, but the governing class is factually subordinate to the dominant class.

    Democracy, in its most general sense, is the government of the majority over the minority. But this concept was coined in slave-owning Athens of the 5th century BC, where only adult male citizens could vote, excluding women, slaves, and foreigners. The democracy of adult male citizens was a dictatorship for everyone else — the overwhelming majority. This dialectical relationship extends to all class societies: every democracy is a dictatorship for those systematically excluded from the majority’s will, and every dictatorship preserves an internal “democracy” for the class that imposes its hegemony. The relationship is dialectical, not identical.

    The Rule of Law (Estado de Derecho) is the idea that the state’s power is regulated and guaranteed by law — meaning the state creates law and then voluntarily submits to its own creation. But the article argues this is a sophism: states do not create law to submit to it; they create it as a regulatory framework founded on the interests of the politically and ideologically dominant class. As evidence, the author points to Article 105 of Costa Rica’s own Constitution, which prohibits referendums on budgetary, tax, fiscal, monetary, credit, pension, security, and administrative matters — that is, on virtually every fundamental issue of national social life. The validity of any referendum result is ultimately subject to the decision of the Legislative Assembly. The state, in other words, has structurally exempted itself from popular will on every matter that counts.

    And corruption? It is not an aberration. Defined as the practice in which a public official formally deviates from the functions for which they were entrusted with power, corruption “formally” (not factually) departs from stated commitments. Why is the deviation formal rather than factual? Because, within this framework, corruption is a necessary mechanism for the interests of the dominant class to impose themselves over the rest of society while electoral democracy reigns — one of several mechanisms that enable factual dictatorship through the alienation of the dominated classes.

    Three Processes, Two Levels of Abstraction

    The theoretical heart of the article lies in the way it reconstructs the relation among primitive accumulation, accumulation by dispossession, and what it calls acumulación entrelazada. In this post, I translate the latter deliberately as intertwined accumulation. The choice matters because it allows us to distinguish the concrete process reconstructed in the Costa Rican case from the broader concept of entangled accumulation developed by Guilherme Leite Gonçalves and Sérgio Costa.

    The distinction is not merely terminological. At the level of objective historical processes, primitive accumulation and accumulation by dispossession can possess relative autonomy: they are distinguishable mechanisms with their own immediate forms, temporal locations, and material effects. Relative autonomy does not mean isolation. It means that one can identify each process in reality without denying that, under concrete historical conditions, they coexist, penetrate one another, and alter the conditions under which the other operates.

    Primitive Accumulation

    Marx’s original problem: the violent historical separation of producers from their means of production and the construction of the property relations required for capitalist production. In the Costa Rican sequence, this includes colonial dispossession, Carrillo’s 1841 abolition of communal tenure, the 1882 decree that treated Maleku territory as vacant land, and the Soto-Keith concession of 1883. These are not simply old events remembered by a later capitalism; they establish legal and material conditions that subsequent accumulation inherits.

    Accumulation by Dispossession

    David Harvey’s formulation identifies the continuing and contemporary use of expropriatory practices: privatization of land and common goods, suppression of collective rights, commodification of previously non-commodified spheres, colonial or neo-colonial appropriation of assets, and the use of credit, law, and state power to transfer resources. In the Costa Rican case, this logic appears in contemporary territorial occupation, conservationist appropriation, environmental-service markets, and other mechanisms that convert collectively preserved resources into fields of accumulation.

    Intertwined Accumulation

    As reconstructed here from Gómez Julián’s Costa Rican case, intertwined accumulation names the concrete relation of mutual conditioning and reinforcement among relatively distinguishable accumulation processes. It is the point at which an earlier expropriation creates the legal, spatial, or social conditions for a later dispossession; the later dispossession reproduces or deepens the effects of the earlier one; and both become connected to new fractions of capital, state institutions, and wider circuits of accumulation. In this sense, intertwined accumulation is not a synonym for either primitive accumulation or accumulation by dispossession, nor does it abolish their analytical distinction.

    Relative Autonomy Does Not Mean Separation

    This way of reading the historical record avoids a false choice. We do not need to say either that primitive accumulation is a closed episode belonging only to the birth of capitalism, or that every later dispossession is simply the same phenomenon under a new name. A concrete process may be identified as primitive accumulation when it restructures property relations by separating communities from the conditions of their reproduction. A contemporary process may be identified as accumulation by dispossession when already existing rights, assets, commons, or public resources are transferred into circuits of capital. And a third analytical problem appears when the effects of these processes become causally linked.

    That third problem is what intertwined accumulation captures here. The relevant relation is not merely chronological succession. It is a material interaction: one process changes the conditions of possibility of another. Earlier legal destruction of communal tenure can make later private occupation easier; later occupation can normalize and reproduce the property regime created by the earlier rupture; state regulation can connect both to transnational commodity chains, tourism, conservation finance, or carbon markets. The processes remain distinguishable, but their effects are no longer additive. They become synergistic.

    Concrete analytical structure
    Primitive accumulation + accumulation by dispossession → mutual conditioning → intertwined accumulation

    The arrow does not mean a rigid historical sequence. It represents a causal relation that may operate across different periods, regions, and institutional forms.

    The Costa Rican mapping makes this visible. Carrillo’s abolition of communal tenure created a legal environment within which the Huetar coffee-frontier dispossession could advance. Decree XIV of 1882 converted Maleku territory into legally available space and enabled its appropriation by ranchers and settlers. The Soto-Keith concession connected territorial dispossession in Talamanca to transnational banana capital. PILA and the PSA later inserted ancestral territory into conservationist and environmental-value circuits, linking local territorial conflict to tourism, state administration, and global carbon capital. The post-2011 de facto recoveries reveal the contemporary collision between the collective indigenous regime and the individual capitalist regime produced through this long history.

    Entangled Accumulation: The Broader Category

    This is where Gonçalves and Costa’s concept of entangled accumulation becomes especially useful. Their 2019 formulation is deliberately broader. It seeks a comprehensive category for the interdependencies that have structured capitalist expansion across history: exploitation and expropriation; wage and slave or otherwise unfree labor; state power and illegal violence; capitalist and non-capitalist economies; different geographical scales; different historical periods; and intersecting social hierarchies such as class, race, ethnicity, and gender.

    In that broader framework, primitive accumulation, accumulation by dispossession, financial expropriation, superexploitation, and other forms do not follow a rigid chronology. They may coexist in the same period and space, disappear and re-emerge, and become connected through law, politics, corruption, culture, discourse, and the changing boundary between state and market. Entangled accumulation therefore operates at a higher level of abstraction: it is a general category for the historical interpenetration of multiple mechanisms and dimensions of capitalist accumulation.

    The two concepts can therefore be related without collapsing them into one another. Intertwined accumulation, as used in this post to interpret the Costa Rican article, is the more concrete category: it identifies a specific process of causal articulation and synergy among distinguishable modes of accumulation inside a determinate historical formation. Entangled accumulation, in Gonçalves and Costa’s sense, is the more general category under which such concrete articulations can be theorized together with many other forms of interdependence.

    Relationship between the concepts
    EintertwinedEentangled

    This set-theoretic expression is an interpretive shorthand used in this post, not a formula stated verbatim by either paper. It means that the specific Costa Rican process can be treated as one concrete determination within the wider family of interdependencies captured by entangled accumulation.

    This distinction also clarifies why the Costa Rican article can speak of the convergence of primitive accumulation, accumulation by dispossession, and intertwined accumulation without reducing all three to one undifferentiated process. The first two refer to mechanisms that can be identified with relative autonomy; the third refers to their concrete articulation when they coexist and reinforce one another. At the same time, that entire configuration can be located within Gonçalves and Costa’s more encompassing theory of entangled accumulation. What looks like a terminological inconsistency at a purely abstract level thus becomes, at the level of historical reality, a useful distinction between mechanisms, their interaction, and the general category capable of containing both.

    The key distinction is between a mechanism and a relation among mechanisms: primitive accumulation and accumulation by dispossession can be identified separately, while intertwined accumulation names the historically concrete synergy through which they condition and reproduce one another.

    A Timeline of Dispossession: Key Milestones

    1542–1880

    Laws on baldíos, early decrees (e.g., Guatuso). Legal-administrative dispossession: Crown → State → Private hands.

    1830–1890

    Coffee boom and beneficio system. Concentration via processing and credit. Huetar resistance in Orosí (c. 1860). Dissolution of communal land regime.

    1870–1910

    Banana concessions (Keith/UFCO). Bribri-Cabécar displacement. Atlantic enclave; corporate spatial control; dispossession in Sixaola.

    1933–1940

    Coffee regulatory bodies (Instituto de Defensa del Café). Crisis management without reversal of concentration.

    1950s–1970s

    Internal colonization (ITCO/IDA). Convention 107. Law 2825. Partial titling; insecurity and frontier appropriations persist.

    1977

    Indigenous Law 6172. Formal recognition vs. persistent non-indigenous occupation.

    1982

    Creation of Parque Internacional La Amistad (PILA). State-conservationist appropriation of Bribri-Cabécar ancestral territory.

    2011–present

    De facto recoveries in Salitre, Cabagra, Térraba. Community reoccupation. Threats and attacks intensify.

    2019–2024

    Assassinations: Sergio Rojas (March 18, 2019), Jethy Rivera (February 24, 2020). UN/IACHR: impunity. Rivera conviction reversed; Rojas case archived.

    Why Land Is Not Just Land: The Question of Rent

    The article introduces one more theoretical tool that deserves attention: the Marxist concept of ground rent — both natural and differential. Contemporary indigenous struggles, the author argues, cannot be explained solely by the seizure of land as a means of production. They also revolve around the natural resources those lands contain: water, forests, biodiversity, scenic beauty, carbon sequestration capacity. The yield from these resources can be converted into rent that is appropriable by various fractions of capital — agroindustrial, extractivist, touristic, conservationist (private or state-run).

    The PSA inside indigenous territories, the nature tourism surrounding national parks created on ancestral lands, the monetization of environmental services in the carbon market, and adjacent agroindustry are all concrete devices through which capital captures or redistributes rents whose material base is precisely the territories that indigenous peoples have preserved through their historical struggle. Indigenous territorial defense is therefore simultaneously defense of communal use-value against capitalist exchange-value, and a material obstacle to the full realization of differential rent by capital.

    What This Means — and Why It Matters Beyond Costa Rica

    The article’s conclusions are blunt. The “White Legend” of Costa Rican democratic exceptionalism does not survive contact with the evidence. A country where nearly three-quarters of the peasantry is landless, where the Gini coefficient for land ownership approaches 0.8 nationally and reaches 0.9 in cattle regions, where over 90% of farms in some zones lack legal titles, and where indigenous leaders are assassinated with impunity for reclaiming territories that the state itself has legally recognized as theirs — that country is not a democratic anomaly in an unequal region. It is a case study in how formal democracy and extreme agrarian concentration coexist, and how the latter is structurally enabled by the former.

    The argument is not that Costa Rica is uniquely evil. It is that the myth of its exceptionalism serves a function: it legitimizes the very regime of accumulation that makes extreme inequality possible. The “White Legend” is not a miscalculation or a public-relations excess. It is, in the article’s framework, an ideological device that is functional to the system it obscures. As long as Costa Rica believes it is democratic and equal, the structural mechanisms that produce dispossession operate without scrutiny.

    And the final, perhaps most unsettling implication: the article concludes that non-indigenous civil society participation is essential to defend rights that are “fundamentally irreconcilable with the needs of accumulation.” The rights of indigenous peoples over their territories, in other words, cannot be secured within the existing accumulation regime without a political rupture that extends beyond indigenous communities alone. This is not a call for charity or solidarity in the conventional sense. It is a structural observation: the system that dispossesses indigenous peoples is the same system that produces landlessness among non-indigenous peasants, and their interests converge at the point where the logic of accumulation is challenged.

    §

    A Note on the Source

    This post is primarily a reading of José Mauricio Gómez Julián, “Acumulación por despojo y el mito del excepcionalismo democrático costarricense: el despojo indígena como rasgo estructural de la concentración agraria,” Revista de Historia, No. 93 (January–June 2026), pp. 1–45, published by the Universidad Nacional de Costa Rica. The article is available under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International license. The author is an independent researcher specializing in political economy and statistical methodology, with a degree in Economics from the Universidad Latina de Costa Rica.

    The conceptual clarification developed above also engages Guilherme Leite Gonçalves and Sérgio Costa, “From primitive accumulation to entangled accumulation: Decentring Marxist Theory of capitalist expansion,” European Journal of Social Theory (2019), DOI 10.1177/1368431018825064. To keep the analytical levels distinct, this post deliberately reserves entangled accumulation for Gonçalves and Costa’s broad category and uses intertwined accumulation for the more concrete process reconstructed from the Costa Rican case. That terminological distinction is an interpretive choice of this post rather than a claim that the two papers themselves explicitly establish the same hierarchy in those exact words.

    The article is explicitly situated within Marxist political economy and historical materialism. It does not claim neutrality: it argues that the theoretical framework it employs has superior explanatory power for the phenomena it documents, and it reconstructs its core political categories (State, Law, Democracy, Rule of Law, Corruption) inductively from the historical evidence rather than importing them as axioms. Readers who disagree with the theoretical framework may still find the empirical documentation — drawn from census data, property records, legislation, UN reports, Inter-American Commission records, and direct indigenous testimony — valuable in its own right.

    The data referenced throughout — Gini coefficients, titling statistics, acreage figures, occupation percentages — are drawn from the sources the article cites (Seligson, Edelman, Brockett, Dunkerley, Paige, Guevara and Chacón, Vargas Mena, Zúñiga et al., and others). No figures have been invented or extrapolated beyond what the article itself presents.

    “The history of the communities indigenous from the conquest to the present reveals not an exceptional democratic inclusion but a systematic dispossession as a structural feature of capital accumulation.”

  • SOME REFLECTIONS ON MARX’S PRICES OF PRODUCTION

    SOME REFLECTIONS ON MARX’S PRICES OF PRODUCTION

    Was Marx Wrong About Prices of Production? — A 260-Page Investigation Says No

    Political Economy • Econometrics • Marx

    Was Marx Wrong About Prices of Production?
    A 260-Page Investigation Says No.

    How one researcher spent years showing that the most famous critique of Marx’s economics rests on a mistake Marx never made.

    Based on: Gómez Julián (2026), “Some Reflections on Marx’s Prices of Production” — Introduction, Conclusions & the Formal-Empirical Chapter · DOI 10.5281/zenodo.21842251

    A Fatal Flaw, or a Fatal Misreading?

    For over a century, a single mathematical argument has been wielded as the definitive proof that Karl Marx’s economics doesn’t work. It goes like this: Marx claimed that the value of goods is determined by the labor that produces them, and that market prices eventually gravitate toward “prices of production” — modified versions of those labor values, adjusted for how capital-intensive each industry is. But when you try to verify this with a system of simultaneous equations, the numbers don’t add up. The sums of values don’t equal the sums of prices. The theory, critics have said since the early 1900s, contains a fatal algebraic error.

    This paper — spanning 260 pages and drawing on philosophy, history, sociology, and statistics — argues that the error was never Marx’s. It was the error of the people who checked his math using a method he never used.

    The Photograph vs. the Movie

    Imagine you’re trying to understand a river. You could take a photograph of it — capturing one frozen moment — or you could film it as a movie, watching how the water flows over time. For over a hundred years, the economists who criticized Marx took a photograph of his theory and then complained that it didn’t look like a movie.

    Here’s the specific issue. Marx described a two-step process: first, a general rate of profit forms across the entire economy; then, each industry’s price deviates from its pure labor value according to how much capital it ties up relative to the average. The standard critique — originating with Ladislaus von Bortkiewicz in 1907 and repeated ever since — takes all of Marx’s accounting identities and solves them simultaneously, as if input prices and output prices were determined at the same instant. Under that framework, Marx’s three aggregate equalities cannot all hold at once.

    The “inconsistency” that has been attributed to Marx for over a century is the inconsistency of the simultaneous-dualist framework that was imposed on him, and it dissolves as soon as time is restored. — Gómez Julián, summarizing the central thesis

    But here’s the catch: solving everything simultaneously is equivalent to assuming that the economy is a photograph — that there is no time. And Marx’s entire framework is built on the opposite premise: that the economy is a process, an unfolding sequence in which the prices that exit one period become the input prices that enter the next. Once you restore that temporal dimension, the “inconsistency” vanishes. The three equalities hold simultaneously — not because Marx was secretly consistent in some miraculous way, but because the contradiction was an artifact of the framework imposed on him, not of his own logic.

    The paper calls the simultaneous approach “Walrasian Marxism” — a phrase that captures the irony: economists imported the logic of Léon Walras’s general equilibrium theory and used it to read Marx, then blamed Marx when the result didn’t work.

    In Plain Language

    Marx was accused for over a century of getting the arithmetic wrong. What actually happened is that someone redid his arithmetic under an assumption he never made — that the prices of things you buy to produce and the prices of things that come out of production are the same prices, set at the same time. If you assume that, Marx’s accounts don’t close. But that assumption is equivalent to saying the economy doesn’t happen in time.

    But Was the Movie Real?

    Pointing out that Marx’s logic works when you read it correctly is necessary but not sufficient. The “temporalist” school has been making this argument for nearly fifty years. But the author noticed a critical gap: nobody in that school had ever taken real-world data and actually estimated the three types of prices Marx described — direct labor values, prices of production, and market prices — and then tested whether market prices actually gravitate toward prices of production as the theory predicts.

    This matters because, as the paper puts it, leaving the correct reading of Marx “in the territory of conceptual argumentation while the incorrect reading occupies alone the territory of measurement” is a strategic vulnerability. If you can’t show that real prices behave the way your theory says they should, your theory remains a philosophical argument, however internally consistent.

    But before presenting any numbers, the paper devotes substantial space to establishing that the process Marx described actually happened in history. This is not an appendix; it’s a foundational part of the argument.

    Before Capitalism

    In pre-capitalist societies, exchange was regulated by labor time — not because someone enforced a theory, but because the material conditions made it so. Barter was dominant, inflation did not exist, and prices could only reflect production costs given available technology. Evidence from anthropology (Malinowski’s Trobriand Islands studies), sociology (Mauss on gift exchange), accounting history (Kula’s analysis of feudal estate records), and even paleogenomics all converge: objects were valued in proportion to the labor they embodied.

    The Transition

    The dissolution of feudal relations, the monetization of exchange, and the destruction of pre-industrial normative frameworks created the conditions for capital to move freely between industries. Thompson’s work on the “moral economy” documents how the new free-market ideology had to be violently imposed, destroying customary protections and creating an unprecedented relationship of exploitation.

    Capitalism Established

    Once barriers to capital movement were destroyed, capital flowed from commerce to industry chasing higher profits, and generalized competition forced a redistribution of total surplus value across sectors. The crisis of 1873 — which destroyed nearly half the blast furnaces in major iron-producing countries — is presented as concrete evidence of the mechanism: firms whose costs were still based on older, individually more labor-intensive methods went bankrupt when they couldn’t compete with prices of production dictated by modern technology.

    In Plain Language

    Prices of production didn’t appear the day someone wrote an equation. They appeared the day capital could freely move from one industry to another chasing the highest profit — which didn’t happen until legal, moral, and political barriers were destroyed. Before that, things were exchanged roughly according to the labor they cost, and there is more than enough evidence — ethnographic, accounting, archaeological, and genetic — to show it.

    What Is a Production Price, Exactly?

    This is where the paper moves into its most technically original territory. The author carefully separates two things that must not be confused:

    What a production price is (the explanandum): it is the expected value, over the distribution of economic perturbations, of the long-run time average of market prices. In plain language: it’s the center of gravity around which actual market prices keep spinning. Not the price they arrive at and stay at (that would be equilibrium), but the average around which they never stop oscillating.

    Key Concept

    The production price is neither an eternal, timeless equilibrium (the error of the simultaneous approach and of Walrasian economics, which takes the law as such for the whole and eliminates time) nor a chaos of prices without law (the error of empiricism, which stays at the level of individual prices and loses the law). It is the law of the whole realizing itself through the contingency of the parts.

    How each step of the process works (the explanans): a rule that determines this year’s market price from last year’s market price and last year’s latent production price, and nothing else. This is modeled as a hierarchical Ornstein-Uhlenbeck process — a three-level cascade in which the production price is itself a latent state with its own dynamic gravitating toward value, and market prices gravitate toward that latent state rather than toward a fixed, noisy index.

    The uncertainty is built into the model explicitly: uncertainty in the average rate of profit, uncertainty in the advanced capital, uncertainty in the disaggregation of national accounts into 37 sectors (handled through multiple imputation with 25 imputations combined by Rubin’s rule), and parametric uncertainty estimated through Bayesian Markov Chain Monte Carlo methods.

    One crucial point: no magnitude is obtained by solving a simultaneous system. Value is constructed empirically and directly as $V = c + v + p$ (cost plus surplus value), and production price as $\Phi = c + K \cdot G’$ (cost plus capital times the general rate of profit). There is no Leontief inversion, no simultaneous algebra, anywhere in the construction.

    In Plain Language

    Think of a production price as the “gravitational center” of a spinning object. The object (a market price) never stops moving — it wobbles, it swings, it drifts — but over time its average position is pulled toward that center. The math describes both what the center is and how each wobble happens, and it does so while honestly accounting for all the uncertainty in the measurement.

    The Defining Equations: (9) Through (11)

    Here is where the metaphor turns into mathematics. The paper writes the definition of a production price in three successive steps — each one making explicit an assumption the previous step left implicit — numbered (9), (10), and (11) in the original text. None of the three generates a trajectory by itself; together they define the explanandum — what the object is — that the cascade below then generates.

    Equation 9 — What a Production Price Is
    $$ \lim_{t\to\infty} E\!\left[\varphi^i_t\right] \;=\; k^i_t + K^i_t\, E\!\left[G'(t,X)\right] \;=\; \Phi^i_t $$

    Here $\varphi^i_t$ is sector i’s market price at time $t$, $k^i_t$ is its cost price (constant capital consumed plus variable capital), $K^i_t$ is the total capital advanced, and $G'(t,X)$ is the general rate of profit — itself a stochastic process indexed by a perturbation $X$ that bundles the exodus of capital between branches and technological innovation.

    In words: a production price is the long-run limit of the average market price. Not the price itself at any instant — that keeps oscillating forever — but where its time-average settles as the horizon stretches out. Notice the object on the right-hand side, $k + K \cdot E[G’]$: it is the same accounting identity introduced earlier (cost price plus the average profit rate applied to capital advanced), except the profit rate is now written as an expectation, because it fluctuates.

    Equation 10 — Making the Averaging Explicit
    $$ \Phi^i_t = \lim_{t\to\infty} E\!\left[\varphi^i_t\right] = \int_{-\infty}^{\infty} \!\left(\lim_{t\to\infty} \varphi^i_t(x)\right) f_X(x)\, dx \;=\; k^i_t + K^i_t \int_{-\infty}^{\infty} G'(t,x)\, f_X(x)\, dx $$

    $f_X$ is the probability density of $X$. The equation says the expectation is an average over every possible state $x$ of the system’s turbulence, weighted by how likely that state is.

    Equation (10) earns its keep by making a subtle move legitimate: swapping the order of the limit and the expectation. That looks harmless, but it hides a real question — does the market price $\varphi^i_t$ even converge to anything as $t \to \infty$? The paper’s answer is no: a capitalist system doesn’t settle into a fixed point, it settles into a limit cycle — perpetual oscillation. So the convergence the argument needs isn’t of the instantaneous price, but of its cumulative time-average. That average does converge, for almost every state of the world, precisely because the system is ergodic — the fraction of time the cycle spends in each region of its orbit stabilizes. This is the Birkhoff ergodic theorem doing, in mathematical language, exactly what Marx says in economic language: the production price isn’t the value the market price reaches and stays at, it is the average around which it never stops oscillating. The oscillation isn’t an obstacle to the average — it is the average’s condition of existence.

    Why the Order of Operations Matters

    The paper invokes Lebesgue’s Dominated Convergence Theorem to justify swapping “limit of the average” for “average of the limit.” This requires bounding market prices by some integrable envelope — economically, that no price can grow without limit, which technological ceilings and competitive pressure guarantee — and, crucially, it does not require that the convergence be uniform across sectors. Uniform convergence would mean competition equalizes profits instantly and identically everywhere, with no room for a shock to hit one industry harder than another. Marx’s theory says the opposite, and the math is built to allow it.

    Equation 11 — When the Capital Base Is Also Uncertain
    $$ \Phi^i_t = \lim_{t\to\infty} E\!\left[\varphi^i_t\right] = \int_{-\infty}^{\infty}\!\!\int_{-\infty}^{\infty} \left[k^i_t + K^i_t(y)\, G'(t,x)\right] f_{X\mid Y}(x\mid y)\, f_Y(y)\; dx\, dy $$

    Equation (10) still treated the capital base $K^i_t$ as known exactly. Equation (11) drops that simplification: $Y$ is a second random variable carrying the estimation error in $K$, with density $f_Y$, and $f_{X \mid Y}$ lets the profit-rate perturbation depend on which realization of that error occurred. The object is the same double average — only now uncertainty is propagated from two sources instead of one.

    This last equation is not a mathematical flourish; it is the reason the empirical section spends so much effort on multiple imputation. National accounts don’t hand anyone a clean measurement of capital advanced by sector — it has to be reconstructed from incomplete data, and that reconstruction carries its own error. Equation (11) is the license to treat that error as a random variable to be averaged over rather than a nuisance to be ignored. The uncertainty is propagated externally — by a generator outside the statistical model itself — rather than estimated as an internal parameter of the dynamic model: estimating $K$’s error inside the model would confound it with the model’s own measurement-noise term, opening a ridge of non-identification between two magnitudes that the data alone cannot tell apart. Kept external, twenty-five complete reconstructions of the data are generated first, each respecting the Marxian aggregate identities to machine precision, the dynamic model is fit on each, and the twenty-five fits are combined by Rubin’s rule. That is the outer average of equation (11), computed by literally drawing from the distribution of $Y$ instead of assuming it away.

    The Engine: A Three-Level Ornstein–Uhlenbeck Cascade

    Equations (9)–(11) define the target; they don’t generate a path toward it. The explanans — the mechanism that actually produces a year-by-year trajectory consistent with that target — is a hierarchical Ornstein-Uhlenbeck process with up to three nested levels, fit as a single Stan program (the same program handles one, two, or three levels, which guarantees that adding levels can never silently break the simpler cases nested inside them). All series enter standardized; time is discretized one year at a time using the Euler–Maruyama scheme.

    Level 1 — The Market Price
    $$ dev_{t,s} = \varphi_{t-1,s} – \Phi_{t-1,s} $$
    $$ \kappa^m_{t,s} = \kappa_{\mathrm{cap}} \cdot \mathrm{invlogit}\!\left(\kappa_s + \beta_1\, z^{TMG}_t\right) $$
    $$ \Delta\varphi_{t,s} = \kappa^m_{t,s}\!\left(-\,dev_{t,s}\right) \;+\; a_{3,s}\, dev_{t,s}^{\,3} \;+\; \gamma\, COM^{std}_{t,s} \;+\; \varepsilon_{t,s} $$

    Subscripts $s$ (sector) and $t$ (year) run throughout. $dev$ is last year’s gap between market price and the latent production price. $\kappa^m$ is the sector’s reversion speed, passed through a logit link that caps it inside $(0, \kappa_{\mathrm{cap}})$ and lets the general rate of profit ($z^{TMG}$) modulate it without ever pushing the system out of the stable region of the discretization. $\varepsilon$ is a fat-tailed (Student-t), stochastic-volatility innovation, so volatility can cluster in time without destabilizing the mean.

    Read the Level 1 line as a spring. The term $-\kappa \cdot dev$ is the restoring force: it pulls the market price back toward the production price with a force proportional to how far it has drifted. The cubic term $a_{3,s} \cdot dev^3$, with $a_{3,s}$ constrained negative by construction — not estimated, imposed — makes that restoring force grow faster than proportionally once the deviation gets large: the further the market strays, the harder it snaps back. This is a declared stability assumption, not a discovery: it guarantees the model can never generate an explosive regime, at the real cost that if such a regime existed in some sector of the actual economy, this particular specification could not detect it.

    Levels 2–3 — Where the Latent Center Itself Reverts
    $$ \mu_{s,t} = m_{0,s} + m_1\, G’_t + m_v\, V_{s,t} $$

    The production price $\Phi$ is not treated as a fixed, observed index; it is itself a latent state that reverts — more slowly, with its own sector speed $\kappa_p$ — toward this mean $\mu$. $m_1$ is the channel running through the general rate of profit; $m_v$ is the coefficient measuring how strongly the production price tracks the directly-constructed value $V_{s,t} = k + p$ (Level 3, and the reason the cascade goes up to three levels rather than stopping at two).

    This is the bridge back to the abstract equations above, term by term. $\mu_{s,t}$ is the estimable stand-in for the right-hand side of (9): $m_{0,s} + m_1 G’_t$ plays the role of $k + K \cdot E[G’]$, and $m_v V_{s,t}$ is the specific functional form chosen for the value-tracking channel that the abstract definition deliberately leaves open (the paper is careful to say that capitalist competition as a function of the value structure is declared at the level of equations 9–11, not derived; giving it the concrete shape $m_v V$ is a modeling choice made at the cascade level, defended by how it performs under validation rather than deduced from the definition). And the expectation of $G’$ from equation (9) has its operational counterpart in the profit rate averaged across the twenty-five multiple imputations — the mechanism equation (11) licenses.

    The coefficient $m_v$ carries real theoretical weight: it is the empirical stand-in for Chapter 9’s claim that prices of production gravitate around values. It is given a neutral prior, $m_v \sim \mathcal{N}(0,\, 0.5)$ — centered at zero, symmetric, assigning equal plausibility to $m_v > 0$ and $m_v < 0$ before seeing any data. That matters for the same reason a fair coin matters in a coin-flip experiment: if the data carried no signal, the posterior would sit wherever the prior put it, hugging zero. It doesn’t. It lands at $m_v \approx 1.0136$ with $P(m_v > 0) = 1$ — evidence that the data moved it there, not the prior. The anchoring to value is found, not assumed into the setup.

    In Plain Language

    The cascade is three springs stacked on top of each other. The market price is tied by a spring to the latent, unobserved production price. The production price is tied by its own, slower spring to a moving target that blends the general rate of profit with the directly-measured labor value. Pull any one spring and let go: it doesn’t snap to a fixed point, it settles into the kind of perpetual, decaying oscillation that equations (9)–(11) describe as an average. The springs are estimated from sixty-one years of real U.S. data, not assumed; the coefficient tying prices of production to values, specifically, could have come back negative or zero — the model gave it every chance to — and it didn’t.

    What the Numbers Say

    The empirical core of the paper is a panel of 37 productive branches of the United States economy over 61 years, from 1960 to 2020. The hypothesis tested encloses three distinct relationships, and the paper is meticulous about not conflating them. Each is stated, tested, and reported separately.

    Market Prices ↔ Prices of Production: The Strongest Link

    This is the relationship with the firmest statistical support, confirmed through six independent lines of evidence:

    Central Finding

    Gravitation exists, and it is slow. The median speed across sectors is $\kappa_m = 0.0770$, equivalent to a half-life of approximately 9 years. Market prices take about a decade to cover half the distance toward their production-price center. This is consistent with Marx’s characterization of gravitation as a tendential, mediated regulation, not an instantaneous fit.

    The number is remarkably stable under stress tests:

    • Removing five of the six productive blocks from the panel barely moves the estimate — it shifts in the third decimal place. The sixth, which gathers 18 of the 37 sectors, does produce a shift (from 9 years to 6 years), and the paper decomposes it: about half the acceleration is the generic effect of halving the panel — removing 18 sectors at random already gives 0.0929 — and not the block itself.
    • Dismantling the value anchor in three different ways — including permuting surplus value across spheres — moves the speed in the third decimal place. This is significant: it means the conclusion about market-to-production gravitation does not depend on the less robust production-to-value link.
    • The market deviation has its own dynamic signature. Compared against a random walk matched in variance, three out of six test statistics separate cleanly (the weighted-sum convergence reaches a tolerance of 0.01 while the null never reaches a tolerance ten times more lenient; recurrence analysis laminarity triples the null; recurrence entropy doubles it). The ones that don’t separate are recurrence-analysis determinism and the two deterministic-chaos invariants — the Lyapunov exponent and the correlation dimension — which the paper never claimed to find.
    • The estimate is invariant to secondary methodological choices. Sweeping the latency regularizer across three values produces life medias of 9 years in all three arms (speeds of 0.0774, 0.0770, 0.0772).
    • The known bias of disaggregation pushes against the result. Splitting a national figure among 37 branches is underdetermined and biases speed estimates downward — meaning the true half-life is probably 7–8 years rather than 9. A bias that works against your conclusion is one you can live with, because the result holds despite it, not thanks to it.

    Prices of Production ↔ Values: The Thinnest Leg

    This is the weakest part of the empirical argument, and the paper states so with complete transparency. The problem is not a defect of the instrument but a property of the object:

    Methodological Transparency

    The coupling coefficient estimated within the dynamic model is $m_v = 1.0136$ with a 95% credible interval of $[1.0096,\; 1.0176]$ — but the same procedure returns 1.0365 when surplus value is permuted across spheres, preserving all annual aggregates. Why? Because production price and value share the cost price, which explains 66.1% of the variance of the former and 72.0% of the latter, and their correlation in levels is 0.9987. The coefficient would land near one even if the law of value didn’t hold at all. The paper therefore reports it as a consistency check, not as evidence.

    The real support for this relationship comes from cross-sectional tests, not from the dynamic coupling. When temporal common trends are removed and analysis is conducted within-year, the slope of the markup on own surplus value is 0.675 with the true data versus 0.090 under permutation, with intervals that don’t come close to overlapping. The sectoral ordering of the wedge between $\Phi$ and $V$ has an inter-annual rank correlation of 0.986 and a 60-year value of 0.558 — highly persistent structure, not noise.

    A collateral finding worth noting: the coefficient of variation of sectoral profit rates is 0.669 — meaning profit rates across industries show considerable and persistent dispersion. Far from contradicting the theory, this dispersion is the condition of existence of the mechanism: if profit rates were already equalized, there would be no differential to drive capital migration, and gravitation would have nothing to operate on. Marx postulates equalization as a tendency, not an accomplished fact.

    Market Prices ↔ Values: Sustained in Form, Adjusted in Existence

    The structural modification across sectors exists and is nonlinear (the nonlinearity step holds comfortably at 6.8 null deviations). But the existence step is adjusted: 44% of its gain is obtained equally with sectoral characteristics unpaired from their spheres, and the gap against the maximum null is on the order of one paired standard error. The coefficients survive a deliberately severe correction for serial dependence (tripling the error).

    The Instrument Behind That Number: A Nested Ladder in gdpar

    That test is a small ladder of nested distributional-regression models, fit with gdpar (Gómez Julián, 2026b), the author’s own R package for generalized distributional parameter regression, published on CRAN on July 15, 2026. The ladder climbs from a bare model — “the market-to-value ratio has no sector-specific correction at all” — through a model where organic composition, wage share, and sector size shift that ratio linearly, up to a model where the correction is a flexible spline rather than a straight line. Two gains matter, measured in units of predictive density: adding the linear correction buys 207.3 units; letting it curve buys another 215.1. Both were checked against a control built to be hard to pass — shuffling which sector gets which characteristics 99 times, refitting each time, with the spline’s knots held fixed across every shuffle so the comparison can’t be won by a better basis alone. The curvature gain clears its null with room to spare (6.8 null standard deviations; the best of 99 shuffles reaches only 114.8 against 215.1 observed). The existence gain is honestly reported as thinner: shuffled sectors still buy about 44% of the real gain merely by having some characteristics to fit — three covariates and an intercept give a model room to accommodate noise even when it is being told nothing true — so the genuine margin over the null sits at about one paired standard error (23.2, against a gap of roughly 24 units). Both numbers are reported together, precisely so the large one isn’t read alone.

    A companion specification, estimated in the same gdpar fit, asks the same question about dispersion rather than location: not where the market-to-value ratio is centered, but how tightly it clusters. Larger sectors and sectors with higher capital composition show systematically less relative dispersion — elasticities of $-0.226$ and $-0.104$ — consistent with equalization operating more effectively where capital is more concentrated. Both effects clear a “breaking factor” (the multiple of the standard error at which the 95% interval would first touch zero) north of six and four respectively, past the 2.94 ceiling reached anywhere else among this paper’s location coefficients, and the finding reproduces under a completely different likelihood family (a gamma distribution on the price ratio) to within 5.2%.

    Three Failures That Confirm the Theory

    One of the most intellectually striking features of this paper is how it handles results that, at first glance, look bad for its thesis. There are three, and the paper reports all of them without softening — then shows deductively why each one was expected if the theory is correct.

    Negative Result No. 1

    The model does not out-of-sample predict better than a random walk. But this was deductively implied by the slow form of the thesis. At a horizon much shorter than the half-life, a mean-reverting process is, to first order, a random walk. If something takes a decade to get halfway back, looking at a single year won’t let you see it return.

    Negative Result No. 2

    The value term is predictively indistinguishable. Again, this follows from the slow coupling between prices of production and values: with half-lives on the order of decades and only 61 years of data, univariate root-unit tests are structurally underpowered.

    Negative Result No. 3

    No univariate test separates the true wedge from its permuted placebos. But this was predicted before measuring, by the persistence of sectoral ordering itself (inter-annual rank correlation of 0.986). A highly persistent time series is hard to distinguish from its permuted version using tests designed for shorter memory.

    Finding these signatures is corroboration of the slow form of the thesis, and not finding them would have been the real problem. — Gómez Julián, on the negative results

    The paper’s stance on this is worth highlighting: “Lejos de refutar la tesis, los tres están deductivamente implicados por su forma lenta” — far from refuting the thesis, all three are deductively implied by its slow form. A single mechanism (slow gravitation) explains both the substantive thesis and all the apparently negative results, and it also survives in the validated posterior. “That a single cause explains the thesis and all the apparently negative results, and that it additionally survives in the validated register, is the opposite of a petitio principii: it is a unified, falsifiable, and internally validated narrative.”

    Temporalism Isn’t a Preference — It’s a Condition of Measurement

    Perhaps the most consequential result in the entire paper is not a number but a statement about what can and cannot be measured. It concerns the “modulator” — the component of Marx’s argument in which the general rate of profit enters into the structural modification of each sphere, meaning the deviation of each sphere is not independent of the reference but generated by it.

    The Identifiability Argument

    When the model was run with a single, fixed general rate of profit for all 61 years (as a simultaneous approach would require), the posterior exhibited a flat ridge: two completely different functional bases (a degree-two polynomial and a spline basis) produced the same pathology to the third decimal place, with an effective sample size of only six draws. The diagnostic got worse with more sampling (R-hat rising from 1.33 to 1.73). This is the unmistakable signature of a direction in parameter space along which the likelihood does not change.

    The cause is theoretical, not computational. With one fixed reference, the modulator can only be identified evaluated at that single point — a single number, not a function over the space of references. You cannot estimate three coefficients from a polynomial if you have one data point.

    When the reference was allowed to vary year by year (61 different general rates of profit), the model converged within minutes, with a large improvement in both time and effective sample size, and zero divergences.

    Named, Not Improvised: Theorems 1A and 1E

    This diagnosis isn’t an ad hoc read of a misbehaving sampler. gdpar (Gómez Julián, 2026b) — the same package behind the nested ladder above — ships a formal identifiability result for exactly this situation. Its Theorem 1A establishes that, with a single fixed reference point, a distributional modulator is identified only at that point: as one number, not as a function over the space of possible references. Theorem 1E is the positive counterpart: letting the reference vary restores identifiability of the modulator as a function. Fitting a degree-two polynomial (three coefficients) or a five-knot spline basis (five coefficients) against one single, unmoving reference asks for more than a single data point in that dimension can support — which is exactly what a flat likelihood ridge looks like from the sampler’s side.

    The figures behind the improvement, precisely: a fixed reference with a degree-two polynomial gives an R-hat of 1.7333, an effective sample size of 6, and 8 divergent transitions in 39 minutes; a one-knot spline basis reproduces the same pathology — R-hat 1.7335, effective sample size 6, 14 divergences, 5.6 hours. Letting the reference vary year by year (61 distinct annual values of the general rate of profit), centering the additive component and raising the sampler’s adaptation parameter to 0.99, gives an R-hat of 1.0035, an effective sample size of 1332, and zero divergent transitions — in 2.9 minutes. That is the 115-fold improvement in time and 222-fold improvement in effective sample size referenced above, and it is a theorem, not a tuning trick: no amount of additional sampling closes that gap under a fixed reference, because the object being asked for — the modulator as a function — simply is not there to find.

    The consequence is stated precisely: with a single fixed general rate of profit obtained by solving the system simultaneously, the claim of Chapter 9 of Volume Three of Capital is unverifiable by construction. It is not that the data are insufficient — the object is not identified, and no amount of data would identify it. The argument does not establish that simultaneism is false as a description of capitalism (that is established by historiography and sociology); it establishes that a simultaneous procedure cannot, even in principle, empirically verify the specific part of Marx’s argument that this work estimates.

    In Plain Language

    Marx says: first a general rate of profit forms, then each industry deviates from it according to how capital-intensive it is. To check whether the deviation depends on the general rate, you need to see what happens to the deviation when the general rate changes. If you calculate one general rate for the entire 61-year span, it never changes, and there is nothing to observe. That is exactly what happened: the model with one fixed rate doesn’t converge — not because of computational limitations, but because it is being asked to measure a relationship with a single observation of one of the two variables. Calculating one rate per year — which is what the temporal reading says you should do — the same model converges in three minutes.

    What This Is, and What It Isn’t

    The paper is careful, almost painstakingly so, about the limits of what it claims. This section matters because a reader coming from the “pro-Marx” or “anti-Marx” side might be tempted to over-read the results. The author doesn’t let you.

    What the evidence authorizes: In the United States between 1960 and 2020, market prices gravitate toward prices of production with a decadal half-life that is sectorially heterogeneous, and this speed survives three independent assaults (removing five of the six productive blocks, destroying the value anchor, varying secondary methodological decisions). This is a measured, calibrated, and falsifiable fact.

    What the evidence does not authorize:

    • It does not claim superior predictive power (the model does not out-predict a random walk, which was expected).
    • It does not claim that univariate root-unit tests confirm gravitation (they are structurally underpowered at this time scale).
    • It does not claim uniqueness or categorical novelty. The contribution is the explicit integration and canonization of a slow gravitation cascade with value anchoring, measured on real data, with propagated uncertainty, validated, and subjected to a diagnostic whose unfavorable results are reported alongside the favorable ones.
    • It does not claim that this statistically demonstrates the law of value, “and not for rhetorical prudence but because it would be false: a price series can show that a magnitude behaves as the law predicts, and cannot explain why that magnitude exists or whether the category with which we name it is the correct one.”

    That last point is the paper’s deepest epistemological commitment. Questions about whether “value” is the right category for what prices ultimately measure are not answerable by any price series, no matter how long. They are answered by history, sociology, and philosophy — and the firm answer is the one obtained when all four disciplines (those three plus statistics) point in the same direction. The four-dimensional convergence is the argument, not any single leg of it.

    The paper also addresses the homology that unifies its seemingly disparate halves — the historiographical-filosofical first chapter and the econometric second chapter. The relationship between necessity and contingency that governs the transition from feudalism to capitalism (where the same demographic shock produced opposite outcomes in different regions of Europe) is structurally identical to the relationship between prices of production and market prices. A law determines the center; circumstances determine each particular outcome. Neither fact negates the other, because they describe different levels of the same reality.

    What It All Adds Up To

    Here is the simplest version of what this 260-page paper establishes:

    Marx was reproached for a century for having done an arithmetic calculation wrong. What happened is that his calculation was redone under an assumption he never made: that the prices of things bought to produce and the prices of things that come out of production are the same prices, fixed at the same time. If you assume that, Marx’s accounts indeed don’t close. But that assumption is equivalent to saying the economy doesn’t happen in time. As soon as you accept that what exits the factory this year is what enters the factory next year, the accounts close without anyone having to fix anything. — Gómez Julián, Summary for the Reader

    But recognizing the conceptual error was only the first half. What had been missing — and what this paper contributes — is doing those accounts with real data instead of with fictitious numerical examples, which is what the school that had the correct conceptual reading had never done.

    The empirical results show that prices in the U.S. economy over six decades do behave as the theory predicts: they gravitate, slowly, toward prices of production calculated with Marx’s theory and no other. This finding survived every attack the author could devise — removing productive sectors, destroying the value anchor, permuting surplus values, varying methodological decisions, and running diagnostics whose unfavorable results are reported in full alongside the favorable ones.

    The part of the argument linking prices of production to labor values is also supported by real evidence, though less firmly, and the paper says exactly where the weak points are and why they are properties of the object, not defects of the instrument.

    And the paper does not claim to have demonstrated the law of value with a series of numbers, because “questions of that kind are not answered with numbers: they are answered with history, with sociology, and with philosophy, and the firm answer is the one obtained when the four things (the previous three, together with statistics) all point in the same place.”

    That convergence doesn’t make the result eternal — better evidence can overturn it tomorrow. But it makes it, for now, “our best possible approximation to the truth.”

    — — —

    “In science as in life, overcoming adversity is what makes us truly strong.”

    This post summarizes the introduction, conclusions, and the formal-empirical chapter (§2.4) of Gómez Julián, J. M. (2026). Some Reflections on Marx’s Prices of Production: Historicity of the Law of Value, Dialectical-Materialist Foundation, and Dynamic Formalization Under Uncertainty. Zenodo. https://doi.org/10.5281/zenodo.21842251. The full paper spans approximately 260 pages across two chapters covering philosophy, historiography, mathematical formalization, and empirical econometrics. Equations (9)–(11) and the model specification cited here reproduce that chapter’s notation; gdpar is cited separately as Gómez Julián (2026b).

    Written for the curious. An invitation to read.

  • Is It Scientifically Possible for Central America To Be a Single Country?

    Is It Scientifically Possible for Central America To Be a Single Country?

    Political Science & History

    Science, Youth, and the Rebirth of a Central American Nation

    The Origins of Scientific Unionism in Central America and Its Unavoidable Future

    History is rarely kind to fragmented nations. At the dawn of the 20th century, Central America was a collection of small, vulnerable republics plagued by authoritarian rule, economic volatility, and the looming shadow of international imperialism. Yet, from the cloistered halls of the University of San Carlos in Guatemala, a quiet revolution was brewing. It was led not by generals, but by students. This is the story of how a group of young intellectuals pioneered “Scientific Unionism”—a movement to reunite Central America not through romantic nostalgia, but through the rigorous application of social sciences.

    Based on Margarita Silva Hernández’s illuminating research, this post explores the historical genesis of this movement. Furthermore, it asks a vital question for today’s political scientists and economists: If Scientific Unionism was valid a century ago, is it not an absolute, long-term historical inevitability for Central America’s survival on the global stage today?

    The Catalyst: 1898 and the Shift in Global Power

    To understand the birth of Scientific Unionism, we must look at the pivotal year of 1898. The Spanish-American War resulted in a resounding victory for the United States, establishing it as a first-rank global power with expansionist ambitions in the Caribbean and Central America. For a group of young university students, this was not merely a geopolitical shift; it was an existential threat. They perceived the conflict as a clash between the Anglo-Saxon and Latin worlds, sparking a profound anti-imperialist consciousness.

    Simultaneously, the region was suffering the aftershocks of the 1897 coffee price crash. The liberal economic model, heavily reliant on agricultural exports and foreign capital (like the newly formed United Fruit Company), had left the isthmus vulnerable. The students saw the economic crisis as a symptom of a deeper disease: the fragmentation of Central America. To them, the petty dictators of the region were complicit in this backwardness, suppressing social mobility and selling out national resources.

    The Birth of Scientific Unionism

    On June 18, 1899, a clandestine group of students formed a society called El Derecho (The Law). Led by a young Nicaraguan, Salvador Mendieta, these students—mostly in their late teens and early twenties—originated from across the isthmus. They were the children of provincial merchants and professionals, united by a shared frustration with the lack of political mobility under authoritarian regimes.

    What set El Derecho apart from previous attempts at Central American unity was their methodological approach. They did not want to simply restore the old Federal Republic of the 1820s through military decrees. Instead, they turned to sociology. Influenced by the positivist ideas of Auguste Comte, Herbert Spencer, and John Stuart Mill, they sought to discover the “social laws” governing Central America.

    “They designated their movement ‘scientific unionism’ to evidence the intellectual condition of its founders and the scientific-social bases of their working methods.”

    Their thesis was clear: Central America was a single nation artificially divided. To reunite it, one could not rely on mere political pacts (which had repeatedly failed, such as the brief “Greater Republic” in 1898). Instead, they needed to build a cultural unity. They believed that through civic education, the eradication of localism, and the application of scientific principles to governance, they could forge a strong, unified state capable of resisting foreign intervention and achieving modernization.

    From Theory to Political Action

    The students of El Derecho did not remain in the classroom. They organized five Central American Student Congresses between 1901 and 1911, creating a regional network of young thinkers. They published pamphlets, established night schools for workers, and delivered public conferences. They positioned themselves as the intellectual vanguard destined to replace the old oligarchic guard.

    Naturally, this provoked the wrath of local dictators. Manuel Estrada Cabrera in Guatemala met their denunciations with brutal repression. Students were imprisoned—some, like Marciano Castillo, dying in the penitentiary—and the movement was forced into exile. By 1904, the students had evolved into a formal political entity: the Central American Unionist Party (PUCA). The student movement had matured into a regional political force.

    A Modern Perspective: The Inevitability of Union

    The preceding sections summarize the historical findings of Margarita Silva Hernández. The following section represents the extrapolation of this blog’s author, using the historical foundation of Scientific Unionism to pose contemporary political and economic questions.

    When Salvador Mendieta and his peers looked at Central America in 1899, they applied the scientific method to diagnose a fractured region. If we apply modern political science and economic theory to Central America today, does the scientific case for union remain valid? The data suggests not only that it is valid, but that it has become a historical inevitability.

    Geopolitical Scale and Relevance: In the 19th century, Mendieta feared absorption by the US. Today, the threat is irrelevance in a multipolar world dominated by giants. A united Central America would encompass a territory of approximately 423,000 square kilometers—larger than Germany. This is not merely a trivia fact; it implies a geopolitical footprint capable of negotiating on equal terms with global powers, managing its own maritime routes, and securing a strategic position between two oceans.

    Diversifying the Production Matrix: Historically, the region has suffered from a monoculture export model (coffee then, and various agricultural or low-tier assembly maquilas now). A unified state would possess an unprecedented diversity of microclimates, resources, and cultural demographics. This diversity would allow for a scientifically planned diversification of the production matrix. The agricultural backbone (coffee, bananas, sugarcane, livestock) would not be abandoned, but rather complemented. A single Central American market of over 50 million people provides the necessary domestic consumer base to justify intense, state-sponsored industrialization. It creates a rationale for heavy infrastructure, regional supply chains, and a unified digital economy.

    The Science of Scale: Modern economics validates the original premise of Scientific Unionism. Fragmented states suffer from duplicated bureaucratic costs, border frictions, and an inability to capture economies of scale. A unified Central America would eliminate these inefficiencies. It could pool its scientific and intellectual capital—much like the students of El Derecho envisioned—into a single educational and technological ecosystem.

    Therefore, the question is no longer merely historical. If Central America wishes to be more than a peripheral zone of extraction for larger economies, union is not a romantic dream of the past; it is a scientific, economic, and historical necessity for the future. The students of 1899 understood the math of their era. We must be brave enough to do the math of ours.

    ~ Exploring the past to architect the future ~

  • Fiscal and Monetary Policy Usually Hold Hands

    Fiscal and Monetary Policy Usually Hold Hands

    Fiscal and Monetary Policy Usually Hold Hands: What 60 Years of U.S. Data Reveal About Economic Independence

    Fiscal and Monetary Policy Usually Hold Hands

    What 60 years of U.S. data reveal about the myth of independent economic instruments

    Imagine you are steering a ship with two sets of controls—one for the rudder and one for the engine. Conventional wisdom says these controls work independently: you can adjust the rudder without affecting the engine, and vice versa. For more than seventy years, this is essentially how mainstream economics has treated a country’s fiscal policy (government spending and lending) and its monetary policy (interest rates and central bank operations). Each set of tools was supposed to be independent of the other, allowing policymakers to pursue multiple goals at the same time without interference.

    A new study published in the Revista Cubana de Economía Internacional challenges that assumption head-on. Using six decades of quarterly U.S. data—from January 1960 to October 2022—and a battery of modern Bayesian statistical techniques, economist José Mauricio Gómez Julián finds that American fiscal and monetary instruments are far from independent. They are, in fact, deeply intertwined, both in straightforward linear ways and in more complex, nonlinear patterns. The implications ripple outward from econometric theory into the practical world of how governments manage economies.

    The Rule That Started It All

    The story begins in 1952, when the Dutch economist Jan Tinbergen—who would later share the first Nobel Memorial Prize in Economic Sciences—formulated a deceptively simple principle: to achieve n independent policy goals, you need at least n independent policy instruments. Known today as the “Tinbergen Rule,” this idea became a cornerstone of economic policy theory. It told governments that if they wanted to control inflation, unemployment, and growth simultaneously, they needed at least three tools that did not overlap in their effects.

    The American economist James Tobin later sharpened this: instruments are independent when “the effects of any instrument on the targets are not proportional to those of any other, or of any combination of others.” In modern econometrics, this independence assumption has been formalized as super exogeneity—a technical condition saying that the statistical relationships between economic variables remain stable even when policymakers intervene. If super exogeneity holds, a central bank can freely adjust interest rates without worrying that the Treasury’s spending decisions will systematically interfere with those adjustments.

    “If a central bank is free to choose the adjustments to its instruments to pursue its final objectives, it has instrument independence.”

    — Laurence H. Meyer, former Federal Reserve Governor

    The problem? Despite its foundational role in economic theory, nobody had rigorously tested this assumption econometrically for the U.S. case—until now.

    Six Instruments, Six Decades

    The study examines six economic policy instruments, divided into two groups:

    Instruments Studied

    • Fiscal instruments: Federal government current spending (GCGF) and federal government policy lending (GACL)
    • Monetary instruments: The effective federal funds rate (FEFR), the Federal Reserve discount rate (TD), other assets held by the monetary authority (TDFG), and the 3-month Treasury bill secondary market rate (LT3M)

    Data sourced from the Federal Reserve Economic Data (FRED) database and YCharts, spanning 252 quarterly observations.

    With these variables in hand, the researcher embarked on a two-stage investigation. First, he tested whether each pair of instruments showed any meaningful statistical association. Then, he built a predictive model to see whether one instrument could be reliably forecasted from the others—which would be impossible if they were truly independent.

    Stage One: Mapping the Web of Connections

    The preliminary analysis used three different correlation measures—Pearson, Kendall, and Spearman—in both their classical (frequentist) and Bayesian versions. The results were striking. Eight pairs of instruments showed significant correlations, with partial correlation coefficients at or above 0.5 in absolute value. For context, a Pearson correlation of 0.5 means one variable explains about 25% of the variation in another—a substantial relationship by any standard.

    Some highlights from the correlation analysis:

    1. The 3-month Treasury bill rate and federal policy lending showed a strong positive correlation (Pearson partial correlation of approximately 0.78).
    2. Federal policy lending and the discount rate were also strongly positively correlated (about 0.77).
    3. Federal government spending and federal policy lending were negatively correlated (about −0.69), suggesting that as one rises, the other tends to fall.
    4. Government spending showed negative correlations with all three monetary interest rate instruments (around −0.59 to −0.61).

    The fact that these correlations held across different statistical measures and survived the stationarity adjustments (seasonal corrections applied via the X-13ARIMA-SEATS method) gives them added credibility. The seasonality adjustments also provided strong evidence that the variables follow approximately normal distributions, further validating the correlation analysis.

    Linearity, Quadratics, and Beyond

    Correlation tells you that two variables move together, but not how they move together. Is the relationship a straight line? A curve? Something more exotic? To answer this, the study employed Bayesian linear regression models and RESET tests (a standard diagnostic for detecting nonlinear relationships), both reinforced with Bayesian bootstrapping—a resampling technique that generates thousands of synthetic datasets to test the robustness of results.

    The findings revealed that most instrument pairs have linear relationships, but in two notable cases—the discount rate versus policy lending, and the federal funds rate versus government spending—quadratic (curved) relationships also play a role. This means the effect of one instrument on another is not constant; it changes depending on the level of the variable, adding a layer of complexity that the Tinbergen framework simply does not account for.

    For example, the relationship between the federal funds rate and government spending follows a parabolic pattern: at lower spending levels, the federal funds rate behaves one way, and at higher spending levels, it behaves differently. This kind of interaction is precisely what “independence” was supposed to rule out.

    Stage Two: Building the Model

    Armed with a clear map of which instruments are connected and how, the researcher constructed a Bayesian Generalized Linear Model (BGLM) to predict federal government policy lending (GACL) from the other instruments. This was not an arbitrary choice: among all the instruments studied, GACL emerged as the most consistently dominated—meaning it is explained by other instruments 75% of the time rather than explaining them. It was the natural candidate for the response variable.

    To handle the nonlinear relationships identified in Stage One, the model used natural cubic splines—flexible mathematical curves that can bend to fit complex patterns without requiring the researcher to guess the exact shape in advance. Think of splines as a series of smoothly connected curve segments that together approximate any function, much like a skilled draftsman’s French curve. The model also incorporated the central bank’s asset holdings (TDFG) as a log-normally distributed random variable, based on the best-fitting distribution identified through empirical testing.

    Model Performance at a Glance

    • Average R-squared: 0.908—the model explains about 91% of the variation in federal policy lending
    • Mean Absolute Error: 68.5 (on a variable that ranges from 146 to 1,682)
    • Root Mean Squared Error: 92.8
    • Convergence (R-hat): 1.0—indicating the Markov Chain Monte Carlo simulations ran cleanly
    • Multicollinearity check: Generalized VIF values below 10 for all effective predictors

    In plain terms: a fiscal instrument can be predicted with high accuracy from a combination of fiscal and monetary instruments. If these tools were truly independent, this would be impossible. The model’s strong performance is the mathematical proof that the independence assumption does not hold.

    What Does History Say?

    The econometric findings do not exist in a vacuum. The study enriches its statistical conclusions with historical evidence from American economic policy, and the alignment is remarkable.

    Consider the Troubled Asset Relief Program (TARP), launched during the 2008 financial crisis. As former Federal Reserve Vice Chairman Alan Blinder has written, TARP “was not about cutting taxes, spending money, or lowering interest rates.” It was not purely fiscal policy, nor was it purely monetary policy. It was a hybrid—designed jointly by the Treasury and the Federal Reserve, using taxpayer money to purchase potentially depreciating financial assets. It was, in Blinder’s words, “financial stability policy, something the U.S. government had not needed since the Great Depression.”

    “TARP was not about cutting taxes, spending money, or lowering interest rates. Instead, it was about putting taxpayer money at risk by purchasing assets that could decline in value. The program was also jointly designed by the Treasury and the Federal Reserve.”

    — Alan S. Blinder, A Monetary and Fiscal History of the United States, 1961–2021 (2022)

    The same pattern recurred with the bank stress tests announced in February 2009—again a joint product of the Treasury and the Fed, again neither purely fiscal nor purely monetary. And it happened once more in 2020, when the COVID-19 pandemic demanded unprecedented coordination between fiscal stimulus checks and the Fed’s asset purchases. Each crisis forced policymakers to blur the lines between fiscal and monetary tools, confirming at the practical level what the data confirm statistically.

    So Which Side Dominates?

    One of the study’s more intriguing findings is a pattern of fiscal dominance. In five out of eight significant instrument pairings, the fiscal instrument is the “dominant” variable—meaning it serves as the predictor rather than the predicted. Federal government spending (GCGF) in particular emerges as a highly dominant instrument, while federal policy lending (GACL) is predominantly the variable being explained.

    However, this is not a clean sweep for fiscal policy. In two cases, monetary instruments dominate fiscal ones, and in one case the direction depends on whether the relationship is modeled linearly or quadratically. The overall picture is one of asymmetric but bidirectional interdependence—fiscal instruments tend to drive the relationship, but monetary instruments are far from passive.

    Why This Matters Beyond the Ivory Tower

    If you are not an economist, you might wonder why the independence of policy instruments matters. The answer is practical and consequential.

    Central bank independence—the idea that monetary authorities should operate free from political pressure—is one of the most widely advocated institutional designs of the past four decades. But this advocacy typically focuses on independence from electoral cycles: the Fed should not cut interest rates simply because an election is approaching. The study’s findings do not challenge that kind of independence. What they challenge is a different, more technical assumption: that the tools themselves operate in separate silos.

    The study concludes that fiscal and monetary authorities in the U.S. are not independent in their instruments—the Treasury’s spending decisions and the Fed’s rate decisions are statistically entangled. This does not mean that central bank independence from political cycles is undesirable or unviable. Quite the opposite: the author suggests that if fiscal and monetary instruments are this deeply intertwined, both fiscal and monetary authorities should perhaps enjoy independence from electoral pressures, not just the central bank.

    Moreover, the finding that fiscal instruments tend to dominate has a subtle but important implication: in complex economic scenarios—financial crises, pandemics, supply shocks—monetary policy alone may be insufficient. The historical record confirms this. The U.S. recovery from the 2008 crisis, which “eventually broke all longevity records,” was driven not by monetary easing alone but by an unprecedented combination of fiscal stimulus and monetary accommodation working in concert.

    Limitations and Open Questions

    The author is admirably transparent about what the study does and does not accomplish:

    1. The analysis is specific to the United States and to the 1960–2022 period. Whether the same patterns hold in other economies remains an open question.
    2. The study examines instrument-to-instrument relationships but does not directly model how these instruments jointly affect policy goals like growth, employment, and price stability—though the author recommends this as a natural next step.
    3. The model presented is robust but not necessarily the best possible model. The goal was to test the independence assumption, not to optimize predictive power, and for that purpose the model is more than adequate.
    4. The strong coordination between U.S. fiscal and monetary authorities may partly explain the findings, but the author argues that the underlying economic dynamics themselves also contribute—the variables are intertwined not just because policymakers coordinate, but because the real economy forces them to.

    The Bottom Line

    For over seven decades, mainstream economic theory has assumed that fiscal and monetary policy instruments are independent of each other. This assumption underpins the Tinbergen Rule, shapes how economic models are built, and influences how central banks are designed. The study by Gómez Julián applies modern Bayesian econometrics to 60 years of American data and finds, with considerable statistical rigor, that this assumption does not hold.

    The instruments of U.S. economic policy are deeply interdependent—in linear ways, in curved ways, and in historically documented, crisis-tested ways. A fiscal instrument can be predicted with over 90% accuracy from a combination of other fiscal and monetary instruments. The Tinbergen Rule’s condition of independent instruments is not just violated; it is violated comprehensively.

    This does not invalidate the Tinbergen framework entirely, but it does suggest that a new paradigm is needed—one that starts from the reality of interdependence rather than the ideal of independence. The economic instruments of the world’s largest economy do not work in isolation. Perhaps it is time our theories stopped assuming they do.

    · · ·

    Reference: Gómez Julián, J. M. (2023). “Análisis econométrico de las relaciones entre los instrumentos de política económica en Estados Unidos.” Revista Cubana de Economía Internacional, 10(2), 72–97. Available at: revistas.uh.cu

    This post is an accessible summary of the original peer-reviewed research article. All quantitative claims and methodological details are drawn directly from the published paper. The interpretations offered here aim to make the findings approachable for a broad audience without distorting the author’s conclusions. Readers seeking the full technical treatment are encouraged to consult the original article.

  • ON THE IMMANENT DIALECTIC IN THE COMMODITY METAMORPHOSIS

    ON THE IMMANENT DIALECTIC IN THE COMMODITY METAMORPHOSIS

    The Hidden Logic Inside Every Price Tag — Reading Marx Through Hegel’s Syllogisms
    Political Economy × Philosophy

    The Hidden Logic Inside Every Price Tag

    How Hegel’s syllogisms reveal the contradictions Marx saw in every commodity — and why those contradictions still matter for understanding capitalism’s future.

    Every time you buy a cup of coffee, two completely different things happen at once. The coffee satisfies a need — warmth, caffeine, pleasure. But it also embodies a social relationship: someone grew the beans, someone roasted them, someone set a price. That double life of every commodity is what Marx called the contradiction between use value and exchange value. An economist recently set out to show that this contradiction follows an exact logical structure — one that Marx sketched but never fully completed.

    Why This Paper Exists

    Karl Marx built his critique of political economy on the logical scaffolding of the German philosopher G.W.F. Hegel. This is not a minor footnote: Hegel’s dialectical logic — the idea that concepts develop through contradiction, moving from thesis to antithesis to synthesis — is the engine room of Capital. Marx famously said he turned Hegel “right side up,” replacing idealism with materialism. But he kept the machinery.

    The problem, as Gómez Julián points out, is that Marx never finished the philosophical job. He used Hegel’s logic to analyze commodities, money, and prices, but he never fully explained how the internal contradictions of the commodity resolve themselves at the level of pure logic. He identified the cycle M–D–M (commodity–money–commodity) and even mapped it onto Hegel’s qualitative syllogism. But then he stopped the philosophical analysis and moved on to economics. This paper tries to pick up where Marx left off.

    “The contradiction between use value and exchange value is one of the most fundamental discoveries of Marxian Economics, a principle without which all the conclusions of the theory of value and money remain dead.”
    — Roman Rosdolsky, cited in the article

    Three Words You Need: Use Value, Exchange Value, Money

    Before going further, let’s make sure the key terms are crystal clear — no economics degree required.

    • Use value is what a thing is good for. A coat keeps you warm. Bread feeds you. This is qualitative — it answers the question “what does it do?”
    • Exchange value is what a thing can be traded for. The coat might be worth three loaves of bread, or $80. This is quantitative — it answers the question “how much is it worth?”
    • Money is the universal translator. It lets every commodity express its exchange value in one common language (dollars, euros, colones). But money also separates buying from selling, creating new contradictions.

    The central tension is this: a commodity is both a useful object and a bearer of abstract social value. These two identities don’t sit comfortably together. The article’s claim is that this tension follows a precise logical structure that Hegel’s system can decode.

    Hegel’s Toolkit: Concept, Judgment, Syllogism

    Hegel’s Science of Logic develops in three stages that mirror how we think. Gómez Julián draws on all three:

    The Concept (Begriff) has three “moments”: universality (what something shares with everything in its class), particularity (what distinguishes it within that class), and singularity (the concrete, individual thing that unites both). Think of it this way: “fruit” is universal; “citrus” is particular; “this orange in my hand” is singular.

    The Judgment (Urteil) is what happens when those moments are set against each other — when we say something is this but also is not that. It’s the moment of contradiction.

    The Syllogism (Schluss) is the resolution. It’s the logical form in which the contradiction finds its movement — not by disappearing, but by developing into something richer. A syllogism has a major term (universal), a minor term (particular), and a middle term (singular) that mediates between them.

    Everyday Analogy Imagine a job market. Workers (particular individuals) want wages (universal standard). The job interview is the singular mediation — the concrete encounter where “this worker” meets “the market price for labor.” The contradiction between what a worker needs and what the market offers doesn’t vanish; it plays out in the negotiation. Hegel’s syllogism captures the logical skeleton of exactly this kind of process.

    Syllogism No. 1 — The Act of Buying and Selling

    The first syllogism Gómez Julián develops is what Hegel calls the syllogism of reflection in its exclusive form. It addresses the most basic question: how can a commodity and money — two fundamentally different things — be exchanged at all?

    Consider the act of selling (M → D). The seller has a particular commodity — say, a specific handmade chair. Money plays the role of the universal: it’s the general equivalent against which all commodities measure themselves. What bridges the two? The social nexus — the web of production relations, market norms, and shared conventions that make exchange possible in the first place.

    In the act of buying (D → M), the logic mirrors itself: money (now universal) is exchanged for a particular commodity, again mediated by the social nexus. The syllogism looks like this:

    Selling: M → D Particular (commodity) — Singular (social nexus) — Universal (money)

    Buying: D → M Universal (money) — Singular (social nexus) — Particular (commodity)

    The key insight is that the social nexus is not an add-on — it is the logical middle term. Without it, the contradiction between a chair and a stack of bills would be irreducible. Marx himself recognized this when he wrote that “a relation of social production appears as something existing outside individuals.” The chair doesn’t inherently “know” it’s worth $200. That knowledge is embedded in social practice.

    Syllogism No. 2 — Price vs. Value

    The second syllogism tackles a subtler problem. Even after an exchange happens, there’s a gap: the price of a commodity almost never equals its value (the socially necessary labor time embedded in it). Prices fluctuate with supply, demand, speculation, season, mood. Marx acknowledged this explicitly:

    “The price-form … allows for the possibility of a quantitative incongruity between price and the magnitude of value — that is, a deviation of the former from the latter.”

    Gómez Julián uses Hegel’s syllogism of analogy to model this. In this syllogism, the middle term is a singularity taken in its essential universality — a particular thing considered not just as itself but as representative of its genus. Here’s how it maps:

    Price–Value Relation: S — U — P Singular: exchange value (the real labor time, which never appears directly on the market — it enters the “capricious volatility of competition”)
    Universal: price (the monetary expression, which carries value inside it but also differs from it — “value in-itself and also value distinct from itself”)
    Particular: exchange value over the long run (the average around which supply and demand oscillate)

    The punchline is elegant: price and value are never identical at a single point in time, but value is always the gravitational center around which prices orbit. This is not a failure of the system — it’s the way the contradiction moves. As Marx wrote, echoing Hegel: identity here is “the identity of negation.”

    Think of It Like This A stock’s price on any given day can be wildly off from its “intrinsic value” (however you measure it). But over time, market forces push the price back toward something like fair value. The deviation is not noise — it’s how the market processes information. Gómez Julián is arguing that this pattern is not just an empirical regularity but a logical necessity embedded in the structure of commodities.

    Syllogism No. 3 — The Big One Marx Identified But Didn’t Complete

    Marx himself noticed that the cycle M–D–M (commodity–money–commodity) can be mapped onto Hegel’s qualitative syllogism P–U–S (particular–universal–singular). The two M’s in the cycle play different roles:

    The first M is particular — it’s a specific commodity I own and want to get rid of (say, the chair I made). The D (money) is universal — it can buy anything. The second M is singular — it’s the concrete commodity I actually need (say, groceries). The money mediates, translating my particular surplus into the particular thing I lack.

    But here’s where the article makes its most original contribution. Marx only named the syllogism and stopped. Gómez Julián argues that the full Hegelian development reveals something Marx left implicit: the commodity embodies both social labor (exchange value) and private labor (use value). Money — as the “universal equivalent” — is the form in which these two kinds of labor temporarily reconcile. But reconciliation is not resolution. The contradiction persists and drives the system forward.

    “The development of the commodity does not suppress this contradiction: rather, it creates the forms in which it can move.”
    — Marx, cited in the article

    Marx compared this to planetary motion: a body is constantly falling toward the sun and constantly being flung away. The orbit is not a resolution of gravity vs. inertia — it is the contradiction in motion. Commodity circulation works the same way.

    From Logic to Collapse: The Tendency of the Rate of Profit to Fall

    The paper doesn’t stop at philosophy. It follows the thread all the way to what Marx considered the long-run fate of capitalism: the tendency of the average rate of profit to fall.

    The logic runs as follows. The average rate of profit is the weighted average of profit rates across all sectors of the economy:

    Average Rate of Profit g'M = Σ wᵢ · g'ᵢ

    where g'M = average profit rate, wᵢ = weight of sector i‘s capital in total social capital, g'ᵢ = profit rate in sector i.

    As capitalism develops, technological innovation replaces living labor (variable capital) with machinery and materials (constant capital). This raises productivity — each worker produces more. But it also means each commodity contains less total labor time and therefore less surplus labor time (the source of profit). Even though the proportion of surplus time within each commodity may rise (higher exploitation rate), the absolute mass of surplus per unit falls.

    To compensate, capitalists must produce at exponentially larger scales — what Marx called the “faux frais” (overhead costs) of production and circulation. Meanwhile, technological unemployment grows, wages are pressured downward, and social tensions mount. The article presents this as the logical terminus of the contradictions embedded in the commodity itself.

    For Non-Economists Imagine a bakery that replaces bakers with machines. Each loaf now costs less labor to make, so the profit per loaf shrinks. The bakery compensates by selling far more loaves — and by cutting the remaining workers’ wages. Scale this across the whole economy, and you get Marx’s picture: profits per unit fall, production must explode, workers are squeezed, and the system becomes increasingly fragile. That’s the “falling rate of profit” thesis.

    Why Does This Matter?

    You don’t have to agree with Marx’s conclusions to appreciate what this paper accomplishes. It demonstrates three things:

    • Hegel’s logic is not decorative. The syllogistic structures are not metaphors — they are the formal architecture that makes Marx’s economic categories cohere. Ignoring them leaves Capital half-read.
    • Contradictions are not bugs — they’re features. The gap between use value and exchange value, between price and value, between private labor and social labor, is not a flaw in capitalism. It’s the mechanism that keeps it moving. Understanding this changes how you think about crises: they’re not accidents but structural expressions of unresolved logical tensions.
    • The long-run trajectory matters. Whether or not capitalism “collapses” in the dramatic sense Marx envisioned, the falling-rate-of-profit framework offers a structural explanation for secular stagnation, financialization, and the persistent pressure to expand into new markets — themes that remain urgently relevant.
    · · ·

    At its heart, Gómez Julián’s paper is an invitation to read Marx the way Marx read Hegel — not as a collection of slogans, but as a living logical system where every economic category carries a philosophical skeleton inside it. The commodity is not just a thing with a price. It is a logical knot tying together private desire, social labor, monetary abstraction, and historical trajectory. Untying that knot — or at least seeing its shape — is the first step toward understanding why economies work the way they do, and why they sometimes don’t.

    Original article: Gómez Julián, J. M. (2017). “Sobre la dialéctica inmanente en la metamorfosis mercantil.” Revista de Filosofía, Universidad de Costa Rica, 56(145), 45–53. ISSN 0034-8252.

    About the original author: José Mauricio Gómez Julián holds a B.A. in Economics from Universidad Latina de Costa Rica. The paper was received in April 2016 and approved in June 2016.

    This blog post is an explanatory summary, not a peer review. For the full mathematical derivations and primary-source quotations, consult the original article.