I don't really understand this: why should capital availability increase in the face of a labor shortage? Making capital doesn't actually create more labor, so wouldn't this just re-allocate labour towards those with more access to cheap capital?
Capital accumulation is necessary because of the tendency of the rate of profit to fall. In other words, you can't merely "create value" as a capitalist. Capitalists must accumulate capital merely to avoid losing everything. Capital accumulation is protected because capitalists literally created a government for that express purpose.
It's a vicious cycle inherent in capitalism. Companies with a substantial amount of capital have the power to exercise decision-making about where to invest, what to invest in, how many jobs and what kinds of jobs to create or reduce. In order to avoid any economic meltdowns, politicians are doing their best to sustain the system and stimulate growth simply by balancing the interests of wealthy people, disregarding the interests of the wider population.
Because the purpose of state-sanctioned cheap capital is to defray the cost of investing in your business...hiring people, buying capital equipment, investing in R&D. Not spiking your own share price by bidding it up on public markets. That does nothing except help managers' stock options more profitable.
It makes sense in that it encourages the holders of capital to return that capital to the domestic economy, spending it on employees, R&D, expanding domestic production, etc.
It seems inevitable in a system where owners of capital reap all the benefits of automation and efficiency. Since most people do not own sufficient capital, they get less and less of the pie.
How are we supposed to fund new capital-intensive ventures otherwise? The government just subsidizes everything at the taxpayers' expense? (Welcome to Canada and Europe.) The government just picks winners in advance? (Welcome to the PRC.)
Capitalism is supposed to reward people that were able to succeed from previous ventures, or alternatively allow people to voluntarily pool more modest amounts of capital together. Everything gets distorted in the real-world, of course.
Yeah, capital accumulation is an inherent quality of capitalism, and accumulated capital then controls the state making so-called regulation impossible. It's only a matter of time.
That's meritocracy. The core to capitalism is contingent on spending capital to gain more capital, whether this is done through merit, politics, marketing, or what have you.
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