Thatcherism and British Manufacturing: a Question of Hegemony
In the broadest sense we are dealing with an old phenomenon. Carthage fell, Rome fell; now it is Britain’s turn. [*] I am grateful to Peter Hall and John Holmes for valuable comments and to the Social Sciences and Humanities Research Council for financial support for the work on which this article is based. More narrowly it is a new phenomenon, the first instance of the threatened absolute decline of a fully capitalist social formation. The last phase of the internationalization of capital has finally subjected whole national economies of industrialized countries to the unforgiving judgments of the law of value. During the first two phases (the internationalization of the circuit of commodities and the internationalization ofthe circuit of finance) Britain, as the first industrializing economy, enjoyed large absolute and comparative advantages in production which permitted its commodities to undersell those of non-capitalist producers and also allowed it to appropriate surplus labour abroad.  C. Palloix, ‘The Self-Expansion of Capital on a World Scale’, Review of Radical Political Economics 9(2), 1977, pp. 3–28; also A. Brewer, Theories of Imperialism, Routledge, London 1980, pp. 23–24. The last phase, the internationalization of production, has exposed all domestic economies to the law of value, including those of the former metropolises. The increasing flexibility afforded manufacturing capital in its choice of production sites—due to technological changes making commodities lighter, production processes easier to disaggregate, transport costs lower, and (perhaps most important) the accumulated skills of specific national labour forces less crucial—has meant that the production process itself has become internationally mobile. Production can now be more and more easily shifted from one global site to another, and those which offer conditions of production below the standard of the most attractive will experience a tendency todecline. The intra-national ‘unevenness’ of capitalist production (e.g. in Britain, the decline of the old northern industrial heartlands and the rise of the south-east) is now matched by international unevenness (rise of the nics, decline of the least efficient older economies).  From this point of view, incidentally, the contemporary general world crisis, while undoubtedly having general causes such as those proposed by Mandel, Frank, Arrighi, Lipietz and others, may also be understood as a result of the operation of the law of value on the U.S. economy, whose decline produces a world-wide crisis because of its weight in total world production and consumption: including Canada, North America accounts for approximately 15% of total world trade, and 25% of OECD trade. O.E.C.D., Monthly Statistics of Foreign Trade, Paris, March 1984. I owe this highly relevant point to Bryant Fairley.
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