The Rate Of Exploitation Under Trump

I am working on a lecture for my criminology class in which I demonstrate the relationship between surplus value and crime and criminal justice spending. This requires consulting the Annual Survey of Manufactures to calculate the rate of surplus value (exploitation, also productivity). I do this nearly every semester to stay current.

I set out to compare 1996, 2006, and 2016 (as I have early data archived). One finds a drastic increase in the rate of surplus value during the first decade measures (1996 and 2006), jumping from 4.25 to 5.60 (these a multiples of value added over wages). Clinton’s neoliberal policies really fucked the working class, who saw their wages stagnate even though they added a lot more value in production.

The rate of surplus value stays stable during the second decade (2006-2016). This is explained in part because of the Great Recession that began late in Bush’s second term and dragged on through Obama’s two terms flattened domestic production (there were other factors, of course, but I put them to one side). One may celebrate the fact that the rate of surplus value was flat (exploitation did not grow worse), but it was because the economy was awful—and that’s bad for working people. People lost their homes. They lost their jobs.

At any rate, curious, I looked at 2019, the last year before COVID-19, to see how Trump did. We know that economic growth was robust under Trump and wages grew rapidly. When wages rise in the context of economic expansion that cuts into the rate of surplus value. In other words, under Trump, workers kept more of the value added in production in wages.

Moreover, joblessness fell to its lowest point in decades under Trump. Supply and demand: shrinking labor surplus puts upward pressure on wages. That’s thanks to immigration restrictions. In other words, Trump suppressed the negative effects of globalization on American working families.

Well, it turns out that the rate of surplus value fell rather appreciably between 2016 and 2019—to 5.42. Trump’s economic nationalism worked for working families. Chalk one up to populism.

As Steve Cortes and Steve Bannon have repeatedly pointed out, the US under Trump was a striver’s economy in which the wealth produced in production was widely shared.

Finally, you may be wondering about the relationship between surplus value and crime and criminal justice spending. In 1994, in the scientific journal Crime, Law, and Social Change, Michael Lynch, Byron Groves*, Alan Lizotte, presents a theoretical and empirical examination of Marxian economy theory and criminology in which the rate of surplus value was found to explain most of variation in crime and criminal justice expenditures. As the rate of surplus value increases, so does crime and criminal justice expenditures. These findings confirm George Rusche and Otto Kirchheimer’s foundational work in Punishment and Social Structure (1939).

*Note: I currently occupy the position formerly held by Byron Groves at the University of Wisconsin-Green Bay. I have also published in the journal Crime, Law, and Social Change. See my 2006 article “Race and Lethal Forms of Social Control: A Preliminary Investigation into Execution and Self-Help in the United States, 1930-1964.”