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Confronting Capitalism in the 21st Century pp 281–309Cite as

Palgrave Macmillan

Demographic Changes, Pension Reforms, and Absolute Surplus Value: Intertemporal Exploitation in Contemporary Capitalism?

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Abstract

This article proposes a Marxist interpretation of contemporary demographic changes and pension system reforms. The former, which have been happening since the first industrial revolution, including population aging and reduced birth rates, can potentially make it difficult for capital to replenish the labor force necessary for exploitation and accumulation at a proper rate in many countries. This possibility has important consequences for the production and reproduction of value and surplus value, insofar as it affects the inflow and outflow of different types of labor power in the circuit of industrial capital as well as the redistribution of social labor by means of taxes and government transfers. Reforming pension systems by increasing the minimum retirement age helps to keep the flow of labor power into the circuit of capital for a longer time, but with a different composition of the labor force, with more experienced workers. This work investigates whether this increased working lifetime of laborers could be seen as a form of intertemporal absolute surplus-value extraction by the equally aging capitalist class.

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Notes

  1. 1.

    Lee assumes a division of the world into more developed, less developed, and least developed countries, and presumes the maintenance of this current structure for the three centuries of demographic transition analyzed (but today’s more developed countries were not developed three centuries ago). Therefore, he takes for granted a permanent global economic inequality. More importantly, the proportion of the population living in poor countries continues to grow, absorbing virtually all the estimated world population growth for the coming decades. If this is valid, then capital can easily find where to look for available pools of labor. And this is likely to change the world economic structure. Witness Asia.

  2. 2.

    To what extent these lower wages imply a lower cost of reproduction of the labor power by means of cheaper commodities in the typical consumption basket for workers is an issue that is not discussed in this paper.

  3. 3.

    Arza and Kohli (2008) argue that intergenerational conflict has replaced class conflict, but the former will not be resolved, with the goal of achieving intergenerational equity, without reference to the latter, which remains relevant. On a more general treatment, Pampel (1994) shows the importance of the social division of classes for the determination of social spending.

  4. 4.

    Rosenthal (2013) provides further evidence about the similarities between wage labor and slave labor, mainly considering the accounting system of the plantations in Southern U.S., which allows for more accurate control of labor.

  5. 5.

    The Meidner plan in Sweden was a classic example of an utter failure in attempting to socialize surplus value through investment funds under workers’ control.

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  1. Federal University of Rio Grande do Sul, Porto Alegre, Brazil

    Marcelo Milan

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  1. Marcelo Milan
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  1. Hofstra University, Hempstead, NY, USA

    Marc Silver

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Milan, M. (2020). Demographic Changes, Pension Reforms, and Absolute Surplus Value: Intertemporal Exploitation in Contemporary Capitalism?. In: Silver, M. (eds) Confronting Capitalism in the 21st Century. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-13639-0_15

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