Reposting an effortpost from a while back about Super-Profit
Let’s say that the average television takes 1 hour to make. 1 hour is the SNLT for televisions. But the owner of the ACME TV factory invests in some fancy new machines that make his workers twice as productive. They can now make a television in 30 minutes. They are producing way below the SNLT. This allows ACME to produce twice as many televisions in the same amount of time.
Now if ACME sold their new TV at half the old price they wouldn’t make any more money than before and there would have been no point in investing in all that new stuff. Rather than sell them at their individual value (30 minutes) they continue to sell them at the SNLT (1 hour), or perhaps just under the SNLT in order to out-sell their rivals. Because the price of TVs hasn’t changed significantly there is still the same demand from consumers for TVs, but now there is a giant surplus of TVs on the market because ACME has been making twice as many TVs. ACME’s rivals won’t be able to sell all of their TVs. Part of their product will go unsold. Meanwhile ACME will sell most of their TVs at the SNLT, making not just their normal profit, but an additional “super-profit” because they sold their TVs above their individual values by selling at or near the SNLT.
Profit vs. super-profit
Profit comes from exploiting workers. The only way to turn money into more money is to invest it in workers, or to be precise, in labor power, the only commodity which can produce more value than it costs. (This is all covered in the video “Law of Value 5: Contradictions”.) When ACME sells TVs at under the SNLT they don’t just reap their normal profits from exploiting workers. They also get super-profits: profit appropriated in exchange because their TVs are made at under the SNLT.
It is this race for super-profits that drives much of the technological dynamism of a capitalist society as capitalists compete to constantly lower SNLT. By doing so capitalists don’t just exploit value from workers. They also appropriate value in exchange.
https://kapitalism101.wordpress.com/2010/09/21/law-of-value-6-socially-necessary-labor-time/https://www.youtube.com/watch?v=Hb6dXR6AfXE&t=4540sHobson, the social-liberal, fails to see that this “counteraction” can be offered only by the revolutionary proletariat and only in the form of a social revolution. But then he is a social-liberal! Nevertheless, as early as 1902 he had an excellent insight into the meaning and significance of a “United States of Europe” (be it said for the benefit of Trotsky the Kautskyite!) and of all that is now being glossed over by the hypocritical Kautskyites of various countries, namely, that the opportunists (social-chauvinists) are working hand in glove with the imperialist bourgeoisie precisely towards creating an imperialist Europe on the backs of Asia and Africa, and that objectively the opportunists are a section of the petty bourgeoisie and of a certain strata of the working class who have been bribed out of imperialist superprofits and converted to watchdogs of capitalism and corruptors of the labour movement.
Because, firstly, it overlooks England’s colonial monopoly. Yet Engels, as we have seen, pointed to this very clearly as early as 1882, thirty-four years ago! Although England’s industrial monopoly may have been destroyed, her colonial monopoly not only remains, but has become extremely accentuated, for the whole world is already divided up! By means of this suave lie Kautsky smuggles in the bourgeois-pacifist and opportunist-philistine idea that “there is nothing to fight about”. On the contrary, not only have the capitalists something to fight about now, but they cannot help fighting if they want to preserve capitalism, for without a forcible redivision of colonies the new imperialist countries cannot obtain the privileges enjoyed by the older (and weaker) imperialist powers.
Secondly, why does England’s monopoly explain the (temporary) victory of opportunism in England? Because monopoly yields superprofits, i.e., a surplus of profits over and above the capitalist profits that are normal and customary all over the world. The capitalists can devote a part (and not a small one, at that!) of these superprofits to bribe their own workers, to create something like an alliance (recall the celebrated “alliances” described by the Webbs of English trade unions and employers) between the workers of the given nation and their capitalists against the other countries. England’s industrial monopoly was already destroyed by the end of the nineteenth century. That is beyond dispute. But how did this destruction take place? Did all monopoly disappear?
If that were so, Kautsky’s “theory” of conciliation (with the opportunists) would to a certain extent be justified. But it is not so, and that is just the point. Imperialism is monopoly capitalism. Every cartel, trust, syndicate, every giant bank is a monopoly Superprofits have not disappeared; they still remain. The exploitation of all other countries by one privileged, financially wealthy country remains and has become more intense. A handful of wealthy countries—there are only four of them, if we mean independent, really gigantic, “modern” wealth: England, France, the United States and Germany—have developed monopoly to vast proportions, they obtain superprofits running into hundreds, if not thousands, of millions, they “ride on the backs” of hundreds and hundreds of millions of people in other countries and fight among themselves for the division of the particularly rich, particularly fat and particularly easy spoils.
https://www.marxists.org/archive/lenin/works/1916/oct/x01.htmOr take the law of wages, the realisation of the value of labour power, which is only realised as an average, and even that not always, and which varies in every locality, even in every branch, according to the customary standard of life. Or ground rent, representing a superprofit above the general rate, derived from monopoly over a force of nature. There too there is by no means a direct coincidence between real superprofit and real rent, but only an average approximation.
It is exactly the same with the law of value and the distribution of the surplus value by means of the rate of profit.
https://www.marxists.org/archive/marx/works/1895/letters/95_03_12.htmOne might imagine that the mere appearance of the capitalist farmer in agricultural production would prove that the price of agricultural products, which from time immemorial have paid rent in one form or another, must be higher, at least at the time of this appearance, than the prices of production of manufacture whether it be because the price of such agricultural products has reached a monopoly price level, or has risen as high as the value of the agricultural products, and their value actually is above the price of production regulated by the average profit. For were this not so, the capitalist farmer could not at all realise, at the existing prices of agricultural produce, first the average profit out of the price of these products, and then pay out of the same price an excess above this profit in the form of rent.
https://www.marxists.org/archive/marx/works/1894-c3/ch47.htmMonopolies, oligarchy, the striving for domination and not for freedom, the exploitation of an increasing number of small or weak nations by a handful of the richest or most powerful nations—all these have given birth to those distinctive characteristics of imperialism which compel us to define it as parasitic or decaying capitalism. More and more prominently there emerges, as one of the tendencies of imperialism, the creation of the “rentier state”, the usurer state, in which the bourgeoisie to an ever-increasing degree lives on the proceeds of capital exports and by “clipping coupons”. It would be a mistake to believe that this tendency to decay precludes the rapid growth of capitalism. It does not. In the epoch of imperialism, certain branches of industry, certain strata of the bourgeoisie and certain countries betray, to a greater or lesser degree, now one and now another of these tendencies. On the whole, capitalism is growing far more rapidly than before; but this growth is not only becoming more and more uneven in general, its unevenness also manifests itself, in particular, in the decay of the countries which are richest in capital (Britain).
https://www.marxists.org/archive/lenin/works/1916/imp-hsc/ch10.htmEngels's negative answer to the question: "Can this revolution take place in one country alone?" wholy reflects the epoch of pre-monopolist capitalism, the per-imperialist epoch, when the conditions did not yet exist for the uneven, spasmodic development of the capitalist countries, when, consequently, the premises did not yet exist for the victory of the proletarian revolution in one country (as is known, the possibility of the victory of such a revolution in one country follows from the law of uneven development of capitalist countries under imperialism). The law of uneven development of capitalist countries, and the concomitant thesis that the victory of the proletarian revolution is possible in one country, where, and could be, advanced by Lenin only in the period of imperialism. That, incidentally, explains why Leninism is Marxism of the epoch of imperialism, why it is a further development of Marxism, which arose in the pre-imperialist epoch.
https://www.marxists.org/reference/archive/stalin/works/1925/sep/15.htmhttps://en.wikipedia.org/wiki/Unequal_exchangehttps://en.wikipedia.org/wiki/Uneven_and_combined_developmenthttps://en.wikipedia.org/wiki/Superprofit