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 Sunday, September 22 2019 5:56am Hongkong Time

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The difference between Capital and Capitalism

Sidney J Gluck

Reproduced with permission of the copyright owner.

The 21st century is witnessing an epical change, something to be noted in the emergence of two poles – one dominated by western capitalism and the other, in the process of forming an association of the former colonial countries in various levels and forms of economic development. Sociol-economic changes have taken place in history similarly, but not in such an explosive and defining character. As an exception, capitalist colonial domination was a part of its growing industrialization and impinged on societies outside of the developing countries for personal gain.

Long before capitalism, under tribal communal society, there was no exploitation of man by man. Elders ran a collective society, which lived off nature's own production with little input of human labor other than gathering. That changed when some clever individuals learned how to use the forces of nature itself to increase nature's own production. They ultimately enslaved others, creating class dominated society. This continued for centuries, developing into control of extended agriculture terrain and animal husbandry which became the main means for human sustenance and growth – this, under feudal serfdom.

During the feudal era, private ownership in many forms developed in early stages where individuals produced desirable items as commodities and ultimately exchanged for money. This was individual production which began to flourish and created the beginning of a mass market. Some clever individuals set up facilities, inviting these individual producers into a "factory" and sell their products to the owners of the factory for mass marketing. This relationship between owner and producer changed into another form of remuneration – that is wages based on the labor-time in the production process and this was the beginning of the capitalist wage-labor system that went through a number of changes that ultimately culminated towards the higher forms of mass production, adding monopolization and today high-tech production which reduces the direct labor time content. Thus, the wage-labor form of exploitation became the basis of industrialization and economic growth. Adam Smith, in his "Wealth of Nations" [1] did not understand that and concluded that an "invisible hand" (Book IV, Chapter II, Para 9) will resolve the fluctuation of market conditions. The fact is, the quantification of labor-time is basically the value of a commodity because the monetary payment to the laborer is only a part of the values created. The total labor-time is realized in the market in the form of money and that is where the accumulation of wealth begins, since the money becomes a form of capital and can be re-injected into a growing economy and can increase financial private wealth accumulation in the market place. This concept of capitalism is Classical Economics, first developed by Karl Marx and published in 1857 [2], that was some thirty years later supplanted by British economist into neo-Classical Economics which established its own version that the wealth is created in the money market – that is merely the area into which the wealth changes its form from commodity into its money value. (The Money Value relates to the cost of labor as a part of the total labor time and that of course, is where the capitalist attempt to control the profits that they accumulate via their pricing.)

The 2008 economic crisis is a good new example of the anti-social effect of the capitalist development, since, for the first time it reveals that private capital takes its own course towards the highest rate of profit – to the neglect of the building of industries and sustained employment in their own countries. However, capitalism has contributed a historic development in the building of industrial production, through individuals amalgamating a work force of wage-laborers in factories small and large. The incentive was private accumulation, but it took the form of capital investment into production of commodities whose values were exchanged in the market, for money as a form of wealth accumulation. Capitalists compete but also monopolized – where private control of a sector of industry magnified exploitation by preventing completion to better control prices and wage-labor relationship. The quantification of wealth is created in the factories based on the labor-time input and is the primary source of the creation of wealth. Capitalist don't produce anything. They market commodities and turn them into the money-form of capital, which can then be reinvested.

Monopolization arises and leads to a higher level of capital investment but preventing competition. Ultimately, financial capital dominates the system and investments in industries ceased in the developed countries while they sought cheap labor overseas. Even further, they incorporated high-tech since there is little cost in training labor for high-tech production – further increasing their accumulation of wealth.

The fact is that the present economic crisis in the USA is an excellent example of the fact that the capitalist class itself has split into two functions – financial and industrial – with finance the dominant factor in the economic structure. The result is not only a cessation of industrial growth but the neglect of exiting industries and the continuation of an economic crisis for workers and the middle class while capital investment overseas has created more profits for the capitalists in 2010 than in the history of Capitalism. True, industrial capital seeks a profit and wealth accumulation, but at least jobs are created and the industrial capital contributes to national economic development and ultimately with high-tech, adds to the level of consumption and living standards.

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Note 1: See "The Inquiry into the Nature and Causes of the Wealth of Nations" by Adam Smith at (or download the PDF backup (2.13MB))

Note 2: See also "Capital", volumes I, II and III by Karl Marx at (or download PDF backup (3.78MB)), (or download PDF backup (2.30MB)), and (or download PDF backup (3.37MB)).

Commentary and reflection pages by Raymond Cheng, PhD DPA FRSA

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COUNT ON THE STATISTICS  100% Towels (c) Daniel Chittka
Photo © Daniel Chittka

This new section contains some interesting statistics in bribe and corruption, please check back for more as we pile up our numbers!

It's statistics time!  Using n-gram: kickback, graft, bribe and corruption - Comparison of their historical occurrences from 1810 to 2009 A.D.

  The word guanxi (collocation) and meanings of bribe: Deeply rooted, disgusting, sad endings

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Photo © Doug Logan
tagged by area of interestBY AREA OF INTEREST
Pragmatics: Politeness trends from the historical perspective of global trade
Computer mediated communications: Social network – Came riding the waves of amazing coincidences
Language acquisition:
A critique on "A corpus driven study of the potential for vocabulary learning through watching movies"

Grammatical analysis: "When a linguist stumbled upon a Buttonwood"
Lexicon and the corpus: "John Sinclair's lexical items – an introduction"
tagged by regionBY REGION • Anything AsiaUS Presence in Asia
ChinaTaiwanHong Kong and MacauJapanKoreaSingaporeMalaysiaPhilippinesPakistanIndiaAfghanistanVietnam, Laos, Cambodia, Thailand and MyanmarTimor-Leste and IndonesiaMongoliaNew Zealand and Australia
tagged by topicsBY TOPIC • BiofuelRhino and elephant poachingAmerican movies hit China marketChina Internet censorshipChina's outward FDI opportunitiesGlobal rice yield
Island disputes in Southeast Asia | Senkakus-Diaoyu and historical findings | Dokdo-Takeshima | Spratly, Paracel, Scarborough | Kurils

For those you who don't have time to read all our news excerpts about the Asian island disputes (links above), you may find the following video, "The economic impact of a war between Japan and China", very enlightening.

© Minute MBA: More from

Free Pussy Riot!
Free Pussy Riot!

Photo © Igor Mukhin, retrieved from Wikipedia

"This trial is another example of the Kremlin's attempts to discourage and delegitimize dissent. It is likely to backfire." John Dalhuisen, Director of Amnesty International's Europe and Central Asia Programme

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10/10 Katya freed, 2 years for Nadya and Masha
10/16 Masha and Nadya sent to remote labor prison

BBC • Pussy Riot women begin life in prison

11/16 Merkel challanges Putin on imprisonment
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11/28 Tolokonnikova's appeal case goes to court
12/24 Extremist videos appeal adjourned

01/15 Masha's sentence deferment denied
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02/07 Pussy Riot files complaint with ECHR
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03/08 Protesters detained in Moscow
04/13 PR gets reprimand: parole problematic
04/21 PR defense seeks abolition of conviction
07/26 Parole denied, PR remains defiant

The Knife supporting PR at Pukkelpop

08/17 Against verdict on PR – Day of Solidarity
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GLUCK ON SOCIALISM AND CHINA Asia (c) Robert Churchill
Photo © Robert Churchill

Professor Sidney Gluck (c) Sandi BachomI am honored to have obtained Professor Sidney Gluck's (right) permission to allow me to repost here some of his work and interview related to China and socialism. Professor Gluck is professor emertius at the New School University in New York. A classical Marxist, Gluck has been studying China for 60 years in history and modern development. He has lectured all over the U.S. and still welcomes engagement at the age of 94 – photo © Sandi Bachom


Usman Khurshid on Mike McCune's HD Monitor with Paths logo with Maartje van Caspel's Public Space
I am proud to announce that the website is now carrying the technology updates from Usman Khurshid's Usman is a network consultant and works in a mixed environment of Windows and Linux platforms. He likes to study about the latest advancements in computer technology and shares his views on his blog.

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Photo © Usman Khurshid, Mike McCune, Maartje van Caspel
COMING 2019 – COMPUTING CORPUS Active Network Hub (c) Phil Sigin-Lavdanski
Photo © Phil Sigin-Lavdanski

Oh, please do not get me wrong. This new section is not about computers, electronics or any engineering stuff, but rather I am currently constructing a new corpus based on Spectrum, the monthly publication from the Institute of Electrical and Electronics Engineers USA, from July 2007 to date. Having been a member for over 20 years since 1992, I am always fascinated by some of the terms scientists use when they talk about or envision their new inventions or methodologies. How many of them eventually come into practice? Could there be some insights we could possibly derive, from the linguistics perspective?


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