The articulation of forms of economy, Causes of the sexed wage gap

 

1  Modes of economy

The Marxist starting point on these questions comes from three classical sources, the section in the communist manifesto on the abolition of the family, the analysis of the value of labour power in Capital[Marx(1887)], and the work of Morgan[Morgan(1907)] and Engels[Engels and Hunt(2010)] on the family. The Manifesto alludes in a very brief way to the aim of abolishing the family and creating a ‘community of women’, but the meaning of this is not immediately apparent from the text. To understand the implications one has to refer to the pre-existing communist literature of the day and to infer conclusions from the later works.

1.1  Basic concepts

The methodological premise of historical materialist investigation is set out in the preface to [Engels and Hunt(2010)].

According to the materialistic conception, the determining factor in history is, in the last resort, the production and reproduction of immediate life. But this itself is of a twofold character. On the one hand, the production of the means of subsistence, of food, clothing and shelter and the tools requisite therefore; on the other, the production of human beings themselves, the propagation of the species. The social institutions under which men of a definite historical epoch and of a definite country live are conditioned by both kinds of production: by the stage of development of labour, on the one hand, and of the family, on the other.

A key point that Engels wanted to emphasise, drawing on Morgan, was that monogamous marriage is a late historical invention. The aboriginal form of human sexual relations was general promiscuity within a band or horde. Natural selection operating at the group level then favoured groups or tribes who adopted successively more elaborate rules prohibiting consanguineous sex, since such rules against incest improved genetic fitness of the group. Promiscuous sex is replaced by various forms of group marriage: groups of ‘brothers’ marrying groups of ‘sisters’ who are not their sisters.

The development of first horticulture, and then plough agriculture then leads via forms of matriarchal marriage to patriarchal polygamous or monogamous marriage. The programmatic interest of Engels in what would otherwise seem arcane works of ethnology comes down I think, to his and Marx commitment way back in 1848 to the abolition of the family as it then exists. This is why he is so enthusiastic about Morgan’s discovery that group marriage was a general predecessor to modern marriage forms. Not only did this prove that contemporary marriage was just one of multiple possible forms; it suggested that just as society was, as the communists maintained, destined to move from primitive communism via class society to a future communism, so would marriage move from group or matriarchal family forms, via monogamy and private property, back to a future system of group sexual relations.

Morgan and Engels views have been controversial, and there has been a strong social pressure for writers to project back contemporary monogamy and patriarchy onto the distant paleolithic past. But the argument that pre-agricultural societies had much more promiscuous sexual relations than post agricultural ones can be supported by modern reseach. [Ryan and Jethá(2012)] collect data from anthropology, primate behaviour and sperm competition theory to argue that Morgan’s basic hypothesis of aboriginal promiscuity is right. But although with Engels the methodological point the importance of production and reproduction is hammered home, there are still a couple of key concepts that are missing and either developed by or made explicit by later Marxists. These are the concepts of combinations of modes of production and the concept of domestic or patriarchal economy otherwise called the domestic mode of production. [Lenin(1965)] described the modes of production or forms of economy in revolutionary Russia as follows:

Let us enumerate these elements:

(1)patriarchal, i.e., to a considerable extent natural, peasant farming;

(2)small commodity production (this includcs the majority of those peasants who sell their grain);

(3)private capitalism;

(4)state capitalism;

(5)socialism.

Lenin was concerned to chart a political strategy of political class alliances in a society characterised by several forms of economy. This concept was developed and popularised in [Rey(1973)]. Although Rey is little known to English readers, his ideas ( sometimes misattributed to Althusser ) are crucial and have had an influence on other thinkers.

[Sahlins and Economics(1972)] developed the concept of the domestic mode of production to describe early economies, and Delphy [Delphy(1980),Delphy and Leonard(1984)] develops the concept of the coexistence of the domestic mode of production with capitalism in her studies of French patriarchal families, particularly peasant families. The idea of the domestic mode of production or domestic economy is examined in greater depth by the Marxist anthropologist Claude Meillassoux[Meillassoux(1981)] who says:

Neither feudalism, nor slavery, even less capitalism, know such regulating and correcting built-in mechanisms governing the process of reproduction. On the contrary, in the last analysis, we find that all modem modes of production, all classes of societies depend, for the supply of labour-power, on the domestic community. As for capitalism, it depends both on the domestic communities of the colonised countries and on its modem transformation, the family, which still maintains its reproductive functions although deprived of its productive ones. From this point of view, the domestic relations of production can be considered as the organic basis of feudalism, slavery as well as of capitalism or bureaucratic socialism. None of these forms of social organisation can be said to represent an integrated mode of production to the extent that they are not based on homogeneous relations of production and of reproduction.[Meillassoux(1981),p. xiii]

The domestic mode of production in the feudal period was the real base of the economy. Peasant households grew food, milled grain, cooked it, spun wool, wove it and out of this fed themselves, clothed themselves and raised the next generation. Since this could typically be done in say 3 days labour a week, that left 3 other days during which they could work, unpaid, in the manorial economy. With the liberation of the peasantry in France from feudal dues, the surplus time could be devoted to producing cash crops to sell on the market. This was the incipient state of the domestic peasant economy when Lenin wrote A Tax in Kind.

Inside the domestic economy there is, Delphy argues, a class antagonism between patriarchs on the one side and on the other side wives and to an extent older children. The patriarchs exploit their wives and children. The wives and children provide labour which yields goods which are partly consumed on the farms, and partly sold on the market. The property relations ensure that the product from the sales of these commodities belong to the male head of household. In addition, the patriarchs typically did fewer hours work a week than their wives. This is not from a historical materialist standpoint women’s oppression, that it too liberal and vague. It is an exploitative class relationship built into the production and property relations.

In the stage of patriarchal commodity production, the patriarchs have a direct interest in their wives bearing children. Children, in a period before compulsory schooling, are an additional labour force to be exploited on the farm from an early age. The pro-natalist ideology of Catholicism, with its accompanying emphasis on pre-marital chastity for girls, is a pretty direct ideological expression of these production relations.

As capitalist industry developed the number of use values produced within the domestic economy started to decline. First went milling as water and wind mills replaced querns. This was well under way in the late feudal period. Next spinning and weaving as factory production of cloth took over by the mid 19th century. Home manufacture of clothes, extended by home sewing machines lasted until the mid 20th century. But production of people continued unabated. So much so that the domestic economy characteristically produced a surplus population that migrated to towns to become wage workers. This stage constituted Lenin’s second economic form : petty commodity producing peasant farms. It was also the dominant economic form over much of the US countryside at the same period.

Expanding capitalist industry required an ever greater labour force, and got it cheap. The wage rate paid did not have to be sufficient to fully recompense the cost of reproducing the next generation, since the patriarchal domestic economy was the main source of supply of labour. This is still the case in India for example.

Marx termed the supply of workers from the countryside the latent reserve army of labour. Latent, because the reserve population was hidden but present, to be called to the colours when industrial cycle goes through an expansionary phase. But this latent reserve army eventually dries up. Once the latent reserve starts to be exhausted real wages have to rise to fully cover the cost of reproducing labour power. [Kuczynski(1946)] argued that it was not until almost a century after the start of the industrial revolution in Britain tha this stage was reached in the 1870s.

2  Domestic and market economy

Working class families are a partial transformation of the old domestic economy. They still produce people, but they do no longer produce any other commodities, and the children they produce have a quite different economic significance to the family. In the rural patriarchal family the children were, within a few years, useful workers who contributed to the family income. In the first phase of industrialisation, families would hire out their children as young factory workers. But soon capitalist industry required an educated workforce. Compulsory schooling followed. Children now became a cost not an asset. The work of child rearing lasts longer, without the income in kind or cash that kids once brought.

 

Figure 1: Characteristic capitalist law of population. Developed capitalism suppresses fertility below reproduction requirements. Illustration is the historical trend of German birth rate. From [Michael J. Kendzia(2012)].

 

Children remain necessary to society, and as a future source of labour power, they are an obvious necessity for employers, but the family now raises them in what amounts more to a social duty conditioned by ideological expectations, than an internal economic necessity. The inevitable consequence of this has been a decline in family size: a falling birth rate. As Fig 1, shows for Germany, the tendancy is for birthrate to fall below reproduction levels. Similar trends exist for other developed countries. Capitalist countries like the US with substantial immigration from predominantly agricultural countries show higher fertility due to the delayed transformation of family forms.

 

Table 1: Time use of Canadians by sex. Note: Averaged over a seven-day week, for population 15 and older. Source: Statistics Canada, General Social Survey, 2005, Catalogue no. 12F0080XWE. Last modified: 2009-09-08.
Males Females
hours per day hours per day
total 24 24
Total work 7.8 7.9
 Paid Work and related activities 4.7 3.1
   Paid work for employer 4.2 2.8
   Commuting 0.4 0.3
 Unpaid work in domestic economy 2.7 4.2
    Household work and related activities 2.3 3.8
    Child care 0.3 0.5
Civic and voluntary activities 0.3 0.4
Education and related activities 0.5 0.6
Personal Care 10.4 10.8
  Night sleep 8.2 8.4
  Meals (excl. restaurant meals) 1 1
  Other personal activities 1.2 1.4
Free time 5.7 5.3

 

In patriarchal domestic economy the labour wives and children are directly exploited by the husband. Their labour contributed directly to his property. The development of capitalist society gives women equal rights to property and eliminates most of the productive activity in the household. Both sexes are now forced to sell their labour power, something that neither did in the old patriarchal family. For both sexes the working day is divided into working hours they sell to an employer, and hours that they continue to work in the domestic economy. If we take Canada as an example, because it publishes excellent statistics on time use, we can see from Table 1 that whilst total working hours for men and women are almost exactly the same, the way these hours divide between work in the domestic and market economes are in reciprocal proportions for men and women. For men it divides [3/2] in favour of the market economy, whereas for women the ratio market/domestic is only [2/3]. The important thing to note however, is that whilst we would conventionally say that Canada is a capitalist economy, the time use statistics show that it is only at most 50% capitalist. Half the work done each day is still done in the home, and a signicant part of the paid work, particularly that done by women[Morissette et al.(2013)Morissette, Picot, and Lu], is done for the state not for private firms, and as such generates no profit.

 

2.1  Gender pay inequality

Now let us look at how the interaction of the domestic and capitalist modes of production affects the position of women in paid employment.

In 2005, the year that Table 1 covers, average male hourly pay was $ 23.41 and average female pay was $ 19.96[Morissette et al.(2013)Morissette, Picot, and Lu].Taking into account the difference in hours worked that means that on average a Candian woman earned only a little over half as much money per day as men.

Gender Paid hours Pay rate Daily earning
per day
Female 2.8 19.96 55.89
Male 4.2 23.41 98.32

It is obvious that the biggest factor affecting daily earnings of women was the shorter number of hours for which they sold their labour power. But that left a gap in pay rates to explain. Let us take what a prominent organisations speaking for women says. The Canadian Womens’ Association1 gave the following reasons for the gap.

  1. First, traditional  women s work  pays less than traditional men s work.  As one researcher notes: ” Female-dominated job classes are often seen as not being skilled because the tasks are related to domestic jobs that women were expected to carry out for free in the home. ”
  2. Second, most women workers are employed in lower-wage occupations and lower-paid industries. Women work in a narrower range of occupations than men and have high representation in the 20 lowest-paid occupations. About two-thirds of the female work force are concentrated in teaching, nursing, and health care, office and administrative work, and sales and service industries. Women aged 25 to 54 accounted for 22% of the Canada’s minimum-wage workers in 2009, more than double the proportion of men in the same age group.
  3. Another reason for the wage gap is that more women than men work part-time. About 70% of part-time workers in 2013 were women, a proportion that has remained steady for three decades. Women working part-time or temporary jobs are much less likely to receive promotions and training than those in full-time jobs.

    Women work part-time for several reasons, including lack of affordable child care and family leave policies, along with social pressure to carry the bulk of domestic responsibilities. These factors make it more likely for women to have interruptions in employment, which has a negative effect on income.

  4. A large portion of the wage gap remains unexplained and is partly due to discrimination. An estimated 10-15% of the wage gap is attributed to gender-based wage discrimination

This appears as a good surface account of the difference but it begs some questions. Why does traditional womens work pay less?

Surely that is just using the gender wage gap to explain the gender wage gap?

The same circular reasoning is present in point 2. If there is a gender wage gap, it follows that any industry with a high portion of women will have relatively low wages compared to an industry with a high portion of men. So this is again circular and can not get to the cause of the gap.

Point 3 is the only real causal explanation, related to the role of women in the domestic economy and a reason why they have difficulty getting out of that economy. Point 4 is merely saying that there is some unexplained difference and that this must by this definition be discrimination. But what causes this discrimination. Employers would like to reduce the wages of all employees. The question is why they are more successful in holding down womens’ wages?

Figure 2: Canadian real wages for men and women. Source [Morissette et al.(2013)Morissette, Picot, and Lu]

 

Look at Figure 2, it is clear from this that the historical trend has been for the wage gap to decline. There was a 20 year period from the mid 1980s during which men’s wages were static and during which women’s wages rose. We need to explain first why a gap exists at all, and then why the gap has changed with time.

[Morissette et al.(2013)Morissette, Picot, and Lu,table 4] examine the change in the gap by doing multi-factorial analysis against union membership, marital status, tenure of job, education and occupation. Taking all factors into account they could explain about 38% of the decline in the wage gap. The three most significant explanatory variables were union membership, educational status and occupation. Changes in union membership by men and women accounted for 11% of the decline in the wage gap(see Table 3).

Women in Canada are now more unionised and better educated than men, reversing the previous situation. Women typically have been in their job slightly longer than men again reversing the situation that used to hold and whilst both men and women are more likely to be employed in health or government services which have been growth sectors of the economy (Table 2).

 

Table 2: Change in statuses for Men and Women, Canada. [Morissette et al.(2013)Morissette, Picot, and Lu,table3]
Men Women
1998 2011 Change 1998 2011 Change
Workers aged 17 to 64
Average tenure (months) 102.2 99.9 -2.3 94.2 101.3 7.1
Percent with a university degree 19.4 24.6 5.2 20.4 29.9 9.5
Percent unionized 33 29.7 -3.3 31.3 33.1 1.8
Percent in health occupations 1.5 1.9 0.3 8.9 11.7 2.8
Percent in occupations in
 social sciences, education,
 and government service 5.2 5.3 0.1 11.2 14.5 3.3

[Morissette et al.(2013)Morissette, Picot, and Lu] have as summary conclusion:

Although women today still earn relatively less than men on average, the gender hourly wage gap decreased significantly over the last three decades. Relative to men, women increased their productivity-enhancing characteristics at a faster pace than men did.

 

Table 3: Explanation of change in wage gap according to [Morissette et al.(2013)Morissette, Picot, and Lu]

 

Change Percent of gap explained
Age 0.002 -2.8
Education -0.006 10.5
Province 0.003 -4.6
Union status -0.006 11.4
Marital status -0.001 1.3
Tenure -0.004 7.3
Occupation -0.01 18
Industry 0.002 -2.8
Total portion explained -0.021 38.4
Portion unexplained -0.035 61.6

This account depends on the idea that wages are determined by productivity. That is to say it follows the textbook neo-classical idea that wages are set by the marginal product of labour and that the wage contract is an equal non-exploitative one. But even if we accept this, which obviously Marxian economists do not, they are only able to account for 38% of the change. They are left with 62% unexplained.

The statistical analysis in Table 3 focuses on things where there are only minor differences between men and women and leaves out the one big thing that differentiates them, womens’ greater participation in the domestic economy.

Now look at Figure 3 and compare it with Figure 2, and you can see that they look pretty similar. As the womens share of the workforce rises their wage rate as a percentage of mens wages rises. In fact the correlation between the two series is 90.9%. That means that only 9.1% of the change in the wage gap needs to be explained by other factors: for instance union membership.

This strongly suggests that should men and women end up working equal number of hours the wage gap will either be eliminated or slightly reversed in Canada; taking into account womens’ higher unionisation and better education.

Figure 3: Canadian employment rates of women and men, 1976 to 2009. Source Statistics Canada, Labour Force Survey, online catalogue entry 89-503-X.

 

 

3  Exploitation and the wage gap

But what are the obstacles to a higher rate of women participating in the workforce?

The key point is that a set of activities are still performed within the domestic economy, and of those women do more than men ( Table 1). The domestic economy still organises a part of the work necessary for social reproduction. This work still needs to get done. Basically there are three ways that womens’ workload in the home can be reduced: (1) a larger share of housework has to be done by men; (2) the productivity of labour in these tasks has to rise; (3) the same tasks have to move out of the domestic economy.

3.1  Division of domestic labour

 

Table 4: Comparison of hours housework in 1998 and 2008 in the respective editions of Time Use of Canadians.

 

Year Mens’ hours Womens’ hours Ratio
housework per day housework per day m/f
1998 2.4 4.1 0.58
2008 2.7 4.2 0.64

There was a previous edition of Time use of Canadians in 1998. By comparing it with the 2008 edition we can see if, over a decade there was a change in the housework done by men and women. As Table 4 shows the share of housework done by men did rise modestly over the 10 years, but this did not reduce womens’ housework, since both men and women did more of it. If women were actually doing more housework in 2008 than in 1998, how did their participation in paid work rise ?

Because they worked longer paid hours too!

So men doing more housework only frees women of it, if the total amount of housework remains constant.

 

Table 5: Relative rates of exploitation of Men and Women in Canada 2011. s/v indicates rate of surplus value. Data derived from Statistics Canada, Income and Expenditure Tables, Statistics Canada, Labour Force Survey, and Figure 2.

 

(1) (2) (3) (4) (5) (6) (7)
(2)/(1) Av Av Av Av
wages surplus s/v Male wage Female wage Both value created
$ 766B $ 497B 0.65 $ 25.03 $ 21.85 $ 23.48 $ 38.72
s/v 0.55 0.77 0.65

References

[Delphy(1980)]
Christine Delphy. The main enemy. Gender Issues, 1 (1): 23-40, 1980.

[Delphy and Leonard(1984)]
Christine Delphy and Diana Leonard. Close to home: A materialist analysis of women’s oppression. Hutchinson, 1984.

[Engels and Hunt(2010)]
Friedrich Engels and Tristram Hunt. The origin of the family, private property and the state. Penguin UK, 2010.

[Kuczynski(1946)]
Jürgen Kuczynski. Labour conditions in Great Britain, 1750 to the present. International Publishers, 1946.

[Lenin(1965)]
Vladimir Ilyich Lenin. The tax in kind. Collected Works, 32: 329-365, 1965.

[Marx(1887)]
K. Marx. Capital, Vol. 1. The process of production of capital. Trans. S. Moore and E. Aveling, Ed. F. Engels. Moscow: Progress Publishers. URL (accessed December 2007): Marx/Engels Internet Archive http://www. marxists. org/archive/marx/works/1867-c1, 1887.

[Meillassoux(1981)]
Claude Meillassoux. Maidens, meal and money: Capitalism and the domestic community. Cambridge University Press, 1981.

[Michael J. Kendzia(2012)]
Klaus F. Zimmermann Michael J. Kendzia. Celebrating 150 Years of Analyzing Fertility Trends in Germany. Forschungsinstitut zur Zukunft der Arbeit, 2012.

[Morgan(1907)]
Lewis Henry Morgan. Ancient society; or, researches in the lines of human progress from savagery, through barbarism to civilization. H. Holt, 1907.

[Morissette et al.(2013)Morissette, Picot, and Lu]
René Morissette, Garnett Picot, and Yuqian Lu. The Evolution of Canadian Wages over the Last Three Decades. Statistics Canada, 2013.

[Rey(1973)]
Pierre Philippe Rey. Les alliances de classes: Sur l’articulation des modes de production: Suivi de Matérialisme historique et luttes de classes. F. Maspero, 1973.

[Ryan and Jethá(2012)]
Christopher Ryan and Cacilda Jethá. Sex at dawn: How we mate, why we stray, and what it means for modern relationships. Harper Collins, 2012.

[Sahlins and Economics(1972)]
Marshall Sahlins and Stone Age Economics. London, 1972.

Footnotes:

1http://www.canadianwomen.org/facts-about-the-gender-wage-gap-in-canada


File translated from TEX by TTH, version 4.08.

Critique of ‘the social construction of sex’

1  Introduction

There has been a controversy  on Facebook recently over whether sexual dimorphism is a conserved mamalian trait or a specific social construct in contemporary human society.

Those arguing that it is a social construct cited [Brown(2014)] as an authority. I will in what follow briefly critique the contents of the paper, but first one may ask why bother to deal with this argument at all?

Surely its basic claim is so at variance with the biological sciences that it can be ignored. That would be the case were left wing publications not taking this type of argument seriously. Misunderstandings on these issues have consequences in terms of how marxists frame long term political programmes about the future organisation of society. They also express the ideologies, social being and contemporary interests, of particular groups in in society whose social position inhibits them from being able to put forward a general programme for the progressive restructuring of family relations and family forms. So in a second section I will touch on these topics.

Another reason to deal with it though is to illustrate just how remarkably low the scientific standards of what can now pass as marxist social theory are. The contrast between the standards of evidence that Brown aduces to back a case, and those that were used by Marx, Lenin or Kautsky is striking.

2  The critique

2.1  Brown’s argument

Brown set out to critique the concept that there exists a socially constructed system of male and female gender superimposed on an underlying biological distinction between males and females. Brown wants to argue against the academic view that

Sex, on the other hand, is claimed to be innate, based on immutable biological factors. This view still upholds an essential maleness  and  femaleness  Males have penises, females have vaginas, females develop breasts and the ability to bear children, males do not, or so it goes, but it is acknowledged that gender expression may not be tied to these characteristics in a rigid way.

In evidence against this Brown says that of the methods used by the medical profession to determine sex : chromosomes, genitals, gonads, hormones and secondary sexual characteristics, all show some variation within each given sex. And that because of this variation, the distinction between male and female is, Brown claims, invalid and purely a social convention.

When we consider all five of these criteria, it becomes clear that a majority of humanity does not fit neatly into the  male  and  female  classifications.

2.2  Weaknesses of the case

Brown’s conclusion is not backed up by any statistical evidence from epidemiological or demographic papers to support this surprising claim that the majority of the population are neither male nor female. To make a valid claim Brown should have been explicit about the calculation procedure used.

The most charitable interpretation is that the conclusion is based on an underlying misunderstanding of how sex classification works. When Brown concludes that : ‘majority of humanity does not fit neatly into the male and female classifications’, the assumption is being made that to be classified as female a baby would have to have XX chromosomes, a characteristically female hormonal balance, ovaries and clearly female genitalia. Let pf be the probability that a baby fits neatly into the female classification and let ph be the probability that the hormonal test succeeds for femaleness, pg, the genital test, po the ovary test, pc the chromosome test. Brown’s hypothesis appears to be that the classification process is multiplicative thus:

pf=ph×pg×po ×pc

and that the 4 tests are statistically uncorrelated. Given the m/f sex ratio for infants is about 51/49 each of these tests would have an expected value close to [1/2] , so under these assumptions pf = [1/2]4=[1/16] and similarly for males, which would lead to the conclusion that only [1/8] of the population were clearly male or female; which would be compatible with Brown’s claim.

But of course the tests are not uncorrelated. The traits are highly correlated so it is adequate in the great majority of cases to simply carry out a genital examination.

Existing census and birth certificate data is based on nothing more elaborate than this. Using such data the literature shows that the incidence of infertility in women so classified is of the order of 10% and among men slightly less [Thonneau et al.(1991)Thonneau, Marchand, Tallec, Ferial, Ducot, Lansac, Lopes, Tabaste, and Spira]. Incidences of infertility vary geographically, for example areas where sexually transmitted diseases have a high prevalence can be significantly greater but in such areas availability of modern medicine is able to bring the rate down[Belsey(1976)]. Note that the incidence of infertility given is for all sources, genetic causes, effects of STDs, and cultural factors like the postponement of childbearing until later in life. So even on the most stringent definition of what it is to be a man or a woman : being able to either father or bear children, 90% are not only sexually differentiated but are reproductively competent.

The rest of Brown’s argument concerns the process by which male or female identity is assigned to babies with rare genetic abnormalities. XXY and XYY abnormalities occur at less than one in a thousand births[Hamerton et al.(1972)Hamerton, Ray, Abbott, Williamson, and Ducasse,Jacobs et al.(1992)Jacobs, Browne, Gregson, Joyce, and White]. It is reasonable to accept that in this, very small, congenitally reproductively incompetent population the assignment of sex as male or female is an entirely social construct. But to generalise from this clearly unrepresentative sample to the whole population would violate all normal scientific sampling procedures.

Brown’s hypothesis, that sex in humans is socially determined, although currently unsupported, is in principle testable. One could randomly select a group of neonates and perform a blinded categorisation of them as male or female. That is to say, the categoriser would be denied all knowledge of the infants’ genital morphology. They could then be brought up from birth so that they were consistently treated as belonging to their blind-assigned sex. If Brown is right, on maturity about 90% of the blind assigned females would have grown up to be reproductively competent women capable of giving birth to live offspring.

The stringent isolation and control that such an experiment would require are reminiscent of that of James IV who isolated infants on Inchkeith to see what language they would naturally speak:

The king gart tak ane dum woman and pat hir in Inchekeytht and gaif hir tua zoung bairnes in companie witht hir and gart furnische them of all necessar thingis pertening to their nurischment that is to say, meit, drink, fyre and candell, claithis, witht all wther kynds of necessaris quhilk (is) requyrit to man or woman desyrand the effect hierof to come to knaw quhat langage thir bairnes walk speik quhene they come to lauchful aige. Sum sayis they spak goode hebrew bot as to myself I knaw not bot be the authoris reherse. (Robert Lindsay cited in [Campbell and Grieve(1982)])

I do however suspect that anyone attempting to test Brown’s hypothesis would encounter difficulties with a modern scientific ethics committee.

3  The implications

Towards the end of the article Brown remarks

Readers may note that thus far, there has not been anything particularly Marxist about our analysis.

This is somewhat of an understatement. This reader noted not only that there was nothing Marxist about the analysis, there was nothing remotely scientific about it. If one looks at works of classical Marxism [Marx(1887),Engels and Hunt(2010),Lenin(1964),Lenin(1999),Kautsky(2014)] one sees clear testable propositions, explicit maths, extensive use of evidence, either original statistical ones or historical ones and scrupulous reference to these sources. These are all a standard part of scientific argument, but are missing from Brown’s paper.

Why does this matter?

First because it makes the left look silly and credulous if it accepts extraordinary propositions without strong supporting evidence. We know that humans are placentals mammals and that all such are characterised by sexual reproduction with two sexes, internal fertilisation, and lactation in females. In all placentals the same basic genetic sex determination process occurs[Ferguson-Smith(2006)]. It would be quite surprising were this to have suddenly changed in the short evolutionary span that separates us from our closest relatives. To prove this you would need a huge mass of data or a really crucial experiment.

Secondly because in the absence of scientific investigation ideology steps in instead, in this case the ideology of the transsexual community. The substitution of ideology for science is bad enough, but the substitution of the ideology of a non-reproductive group in society for Marxist analysis of gender relations is detrimental to the development of a communist programme for the transformation of family relations.

References

[Belsey(1976)]
Mark A Belsey. The epidemiology of infertility: a review with particular reference to sub-saharan africa. Bulletin of the World Health Organization, 54 (3): 319, 1976.

[Brown(2014)]
Freya Brown. The social construction of sex, 2014. URL https://anti-imperialism.com/2014/02/24/on-the-social-construction-of-sex-part-1/.

[Campbell and Grieve(1982)]
Robin N Campbell and Robert Grieve. Royal investigations of the origin of language. Historiographia Linguistica, 9 (1-2): 43-74, 1982.

[Engels and Hunt(2010)]
Friedrich Engels and Tristram Hunt. The origin of the family, private property and the state. Penguin UK, 2010.

[Ferguson-Smith(2006)]
M Ferguson-Smith. The evolution of sex chromosomes and sex determination in vertebrates and the key role of dmrt1. Sexual Development, 1 (1): 2-11, 2006.

[Hamerton et al.(1972)Hamerton, Ray, Abbott, Williamson, and Ducasse]
John L Hamerton, Manoranjan Ray, Johanna Abbott, Christiane Williamson, and G Clement Ducasse. Chromosome studies in a neonatal population. Canadian Medical Association Journal, 106 (7): 776, 1972.

[Jacobs et al.(1992)Jacobs, Browne, Gregson, Joyce, and White]
Patricia A Jacobs, Caroline Browne, Nina Gregson, Christine Joyce, and Helen White. Estimates of the frequency of chromosome abnormalities detectable in unselected newborns using moderate levels of banding. Journal of medical genetics, 29 (2): 103-108, 1992.

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Defence against Vault 7 attacks

In the past cyber attacks were largely carried out by amateurs or criminal gangs. Recent releases of information from Wikileaks have made it clear that a whole range of digital devices have been subverted by intelligence agencies.

More recently they have been commercialised with a market existing in the development and detection of ‘exploits’ or weaknesses. Firms advertise on their websites that they have hacks that allow them to control computers running web browsers such as the latest versions of Internet Explorer or Google Chrome.

Companies that develop these exploits then market them to NATO approved defence and intelligence agencies. In the light of the Snowden revelations it is reasonable to fear that some of the Endpoint attacks exploits in widely used products originating from big US companies like Microsoft, Apple or Google may have been developed on the basis of inside knowledge. Either they are deliberately introduced into the software, or information about the weaknesses may leak to the exploits contractors prior to their being fixed in a subsequent software release.

Government agencies like the UK GCHQ and the US NSA systematically tap communications lines and hack into Internet switches to divert data.

 Historic examples

There is of course a long history of deliberate interception of digital information by intelligence agencies. In the early 20th century the British government operated the ‘red net’, the network of British owned undersea cables connecting the world. It was labeled ‘red’ as the British Empire was marked red on the map. As telegraph and telex information passed through British territories they were systematically copied and decrypted by the intelligence service.

This control of data flows was of decisive importance to British strategic objectives. The first act of hostilities in the First World War was the dredging up and cutting of German controlled sub-sea cables. This occurred with hours of war breaking out. In consequence German diplomatic correspondence had to be encrypted and sent via neutral Holland and then through London to the rest of the world. Using this the British were able to obtain the text of the proposed secret treaty between Germany and Mexico to divide American territory in the even of war. Publication of this treaty in the American newspapers led to the USA declaring war in Germany in 1917.

Later the leaking of secret Commintern telegrams suggesting that the Commintern should support the Labour Party, were used to precipitate the fall of the first Labour Government.

Britain remains a hub for undersea cables, now fibre optic rather than electrical.

Edward Snowden has revealed that all internet communications passing from Europe to North America and on from there are systematically tapped by GCHQ. The revelation that German and other EU communications are still tapped by the UK government caused some controversy when it was revealed by Snowden.

Edward Snowden revealed that within the USA data centers and Internet hubs are linked to the NSA which carries out diversion of information flows similar to GCHQ.

The precautionary principle suggests that chat services like Facebook, Google and Skype can be assumed to be tapped at the premises of the companies running these services.

It is perhaps significant that after Microsoft took over Skype it switched the system to a server based rather than peer to peer based making it easier to tap. Peer to peer traffic does not go through a single server making tapping harder.

From the documents released by Wikileaks it has become clear that the actual encryption algorithms are still secure, but the endpoints are easily compromised. This is one of the motivations behind our proposal: if both endpoints engaging in encrypted communication are secure, it is currently impossible to decrypt the communication.

Traditional viruses  

These install themselves and then propagate copies either by email or external storage media contact ( USB sticks, SD cards, ebook readers etc ). Once installed, what they do is up to the writer of the virus.

The most sinister recent example was the Stuxnet virus, which damaged the equipment in the Iranian gas centrifuge plant. This showed evidence of having been expertly and deliberately constructed in order to produce damage, but not to the computer on which it was run, but to industrial equipment controlled by the computer.

  • The virus was transmitted via USB sticks, copying itself onto any USB sticks inserted in the machine, and copying itself from any USB stick into all machines that the stick was placed in.
  • It specifically targeted a particular type of industrial control software. If the computer it infected had no industrial control equipment it was benign.
  • If it found the equipment, the virus made equipment operate outside safe parameters. It was particularly targeted at centrifuges processing uranium hexaflouride, which were made to run slightly faster than they should, so that they would rapidly wear out.

Although it can not be proven, it is generally assumed that the virus was developed by either Israeli or US stage agencies as part of an attempt to sabotage the Iranian nuclear power programme. It is viewed by commentators as part of an ongoing covert operation that has also involved targeted assassinations of Iranian physicists.

Buffer overflow attacks  

These rely on badly written programmes running on computer A that allow messages sent from computer B to overwrite part of the subroutine linkage area in the data memory of computer A.

  • When this happens the overwriting code gains control over computer A and can install malware. The malware may be activated at some later time to produce effects similar to those due to a virus.
  • Such attacks can be launched from malicious websites.
  • Secuirty exploits in discovered popular web browsers or display programmes such as Adobe Acrobat can take this form.
  • It is important to note that a buffer overflow is a weakness even without injection of code: a buffer overflows can crash e.g. an ssh server, thus effectively resulting in Denial of Service.

Homeric Attacks  

These rely on software that is apparently benign and useful, but which may contain secret malware. They are modelled on Homer’s myth of the giant horse built by the Greeks as a gift to the King of Troy. Typically the malware then copies confidential information from the infected computer to computers controlled by the producer of the malware.

  • The most notorious source of these are freely down-loadable utilities or apparent utilities that the user is induced to deliberately run on their computer.
  • But should government A be able to obtain collaboration from major software companies, it would be possible to introduce Trojan horse software into widely used utilities such as Email readers, word processors, PDF file readers, spreadheets etc. If these were then used by countries B and C in their government offices, then government A might be privy to the confidential reports of governments B and C.
  • In principle, it is possible to guard against this type of attack by stopping the process from communicating over the network, and many firewall products have this ability. However, in practice this is difficult because many applications exchange information with their software company to check for updates, and by blocking the communication, one stops vulnerabilities from being fixed.
  • With our proposed approach however, the need for updates largely disappears as there is much less scope for exploiting vulnerabilities.

Targets

Telephone or internet switching points. These systems fail more gracefully than power networks, but a sufficiently widespread virus attack on switching points could cause significant interruptions to traffic. Air traffic control systems

The use of malware for espionage is an obvious danger, but one has to assume that the Stuxnet virus is just one currently known exemplar of a range of similar designs that have either already been, or could soon be, developed by state cyberwar departments. These would have a wide range of possible infrastructure targets:

  • Modern atomic power stations 1. The Chernobyl accident showed that operation of nuclear power stations outside their design parameters may lead to significant adverse effects.
  • National power grids. Experience in the USA has shown that accidental overloading of a few switching points can lead to cascading failure: safety cut-outs come into operation redirecting current, causing more overloading and further cut-outs. Such cutouts induced by single accident points have led to blackouts lasting hours over substantial parts of the USA and Canada.
  • Telephone or internet switching points. These systems fail more gracefully than power networks, but a sufficiently widespread virus attack on switching points could cause significant interruptions to traffic.
  • Air traffic control systems and air defence radar systems, insofar as these have been upgraded to use modern commodity brand PCs. The hazards here are obvious.

The term ‘computer virus’ is a borrowing from medical terminology. Indeed the very idea of creating computer viruses came from a deliberate copying of biological ideas. It is not surprising that the first technical fix: anti-virus software, also borrowed from biology.

This works on the model of the vertebrate acquired immune system.

Our immune system learns to recognise pathogens and then produces antibodies to them. Our immune system learns to recognise specific amino acid sequences, or motifs, in proteins as belonging to hostile organisms, and produces anti-bodies which bind to and neutralise these proteins.

On first encounter with a new virus we have no defence ( SARS, Ebola etc). Whole races can be wiped out on contact with unfamiliar new viruses: experience of New World and island tribes on exposure to Old World viruses like colds, flu, smallpox.

Likewise, antivirus software relies on the providers of the software recognising motifs in the malicious code and thus identifying it. A software motif is a sequence of bytes invariably found in the code of a particular virus.

A brand new virus will not be detected unless it shares motifs with previous versions.

Monocultures are vulnerable  

 corn_fields blight
Healthy Blighted

Figure Monocultures are vulnerable

All organisms in a monoculture have similar genetic structure if a virus can infect one it can infect all. This is why food crops, where a single species dominates, are particularly vulnerable to infection.

A natural grassland will contain dozens of species, and the ecosystem as a whole is robust against the attack of individual microbial pathogens. A giant field of corn is vulnerable.

   Computer system monocultures

Windows PCs and Android mobile phones are two examples computer system monocultures. The equivalent to the Genome of plants in the cyber environment is the machine code of the microprocessors.

Microprocessors with the same machine code and same operating software can be infected by the same malware. But binary malware for machine code X will not infect a computer with machine code Y.

An machine code is a list of numbers with special meaning to the computer for example

code meaning
0 Load
1 Store
2 ADD
3 SUBTRACT
4 JUMP

Machines can typically recognise hundreds of such codes. Android recognises 256. All programmes run on the system rely on having a standard interpretation of these codes. The meaning of these codes is normally fixed by the electrical circuit of the computer.

In the early days of microprocessors there were many competing code schemes from different manufacturers: Intel, Motorola, Hitatchi, National Semiconductor, Zilog etc all had their own proprietary codes. The process of concentration and monopolisation in the computer industry means that now that computers, tablets and mobile phones nearly all use just two designs of machine code: the US Intel code and the code developed by the UK ARM company. Each of these software companies has licensed their codes to chip manufacturers in other countries, who in turn sell the chips to electronics manufacturers producing final consumer and industrial products.

  • Windows, Apple and Linux computers all use the Intel machine code.
  • Nearly all smartphones and tablets use the ARM machine code.

  Virtual machine codes

Not all programmes depend directly on the raw machine code. Some use a virtual machine code that is interpreted by software rather than hardware. Some widely used virtual machine codes are those from the following US companies :

Oracle:
the JVM into which Java programmes are translated.
Google:
the Dalvik code that is used for Android apps.
Adobe:
the Postscript and subsequent PDF codes used in printers and document viewers.
Microsoft:
the Macro code used in Word documents and Excel spreadsheets.

Whilst the existence of many hardware machine codes protects the computer ecosystem against virus spread, the proliferation of popular virtual codes makes it easier for viruses to spread.

This is because a single computer can now be infected by viruses adapted to several different codes. An Intel PC with virtual machines from Oracle, Microsoft and Adobe installed provides 4 different targets for viruses to infect.

Permuted systems

The basic approach to protecting computer ecosystems should be to create a diversity of machine codes. But this runs up against the high cost of designing computers. A country could not afford to design and build hundreds of completely different microprocessor architectures. The contemporary cheapness of computers is due to millions of identical microprocessors produced by what amounts to a sophisticated printing technology.

We propose to retain this manufacturing advantage, but to introduce as part of the hardware a  permutation unit that shuffles the machine code just before it is executed.

Permuting means re-ordering or shuffling things.

If you construct an chip device with a permuted set of meanings for its machine code no software designed for a standard chip will run on it.

code meaning Permuted meaning
0 Load JUMP
1 Store ADD
2 ADD Load
3 SUBTRACT Store
4 JUMP SUBTRACT

Thus no malware designed for the standard chip machine code will run on it.

It is in principle relatively easy to modify the design of a processor chip so that it incorporates a permutation unit that permutes the machine code. A sensible place to put the permutation unit is between main memory and the instruction cache, meaning that the circuit delay for permutation is only met on loading the cache rather than each time an instruction is executed.

 permuteunit

Figure Permute unit

Suppose you have a machine whose 32 bit codewords looked like this:

field Opcode r1 r2 offset
bits 8 4 4 16

One could use two alternative permutation techniques.

  1. The simplest is to permute the order of the meanings of the opcode field as shown in our previous example. The machine has 256 possible opcodes, so a 256 element permutation table would be needed. This allows 256! different possible unique designs of machine code.
  2. Alternatively one could permute or shuffle the bits in the whole instruction words. Since there are 32 bits, this would allow 32! factorial different codes.

Clearly the first alternative is much better. Each chip would have its unique permutation table stored in non-volatile memory, allowing the permutations to be loaded as a final manufacturing step on chips that were otherwise architecturally identical, and thus run unique machine codes on each of chips coming off the production line. One might allow a facility of field programmability of the permutation table.

Suppose that such chips were available and incorporated into PCs, tablets etc. For markets where there was no particular security problem one could use devices with a null permutation. These would run the native, unpermuted machine code supported by the hardware, but would run the risk of malware infestation.

Suppose the governments of countries B and C want to secure their government ecosystem against viruses, what do they need to do?

  1. Assume that they each settle upon a specific version of Linux for their machines. Country B uses Debian and Country C Ubuntu. Each country has a server for distributing approved copies of Linux to government machines.
  2. Each country maintains a secret database that associates with a identifier of every computer it uses a unique permutation table. The unique id can be conveniently calculated as a hash function of the permutation table.
  3. When the government in country C buys a new computer it sends the machine to a depot containing ServerC . Staff at this depot construct two files: a permutation table, and a boot disk image containing a permuted copy of Linux.
  4. The permutation table is burned into a ROM on the machine and the boot disk installed in the machine.

A binary to binary translator on the server would convert the raw public Linux software to a permuted version able run on a machine with a particular permuted instructionset. A similar binary translation process would be used to provide periodic software upgrades. In this case it would be necessary for the client machine to send its unique identifier when requesting a software upgrade.

Summary

  • ‘Species barriers’ prevent the spread of viruses among the machines of either country B or country C.
  • Buffer overflow attacks launched from country A against either B or C will fail as the introduced malware would not be a valid programme and so would cause an immediate crash on visiting the malicious website in country A. To guard against buffer overflow attacks that could bring down the entire system, the communication stack will be implemented in hardware.
  • Homeric attacks would only be possible if malware was introduced into the source code of the Linux images used by the servers in B and C. The governments would have to insist that software was only mounted on the servers whose source code was:
    • Openly available
    • Had been subjected to inspection to attempt to detect obfuscated malware. This route could not be completely closed, but the ease by which such homeric attacks could be carried out would be much less.
    • Did not contain interpretive code. This is harder to ensure since so many contemporary Linux utilities depend on interpretive code. The consequence would be that the range of software supported on these machines would be strictly limited to a relatively small range of essential utilities.
  • It is not difficult to envisage a similar schema being applied to a range of smart phones which could be distributed with an appropriate permuted operating system.

Why law of value really applies in socialist economies

The term law of value has exoteric and esoteric meanings. The exoteric or superficial meaning is that in capitalist type economy, relative labour values will act as an attractor for relative prices. The more esoteric meaning is that the distribution relations in all societies are constrained by the distribution of labour. In a capitalist economy the great branches of production subsist by trade and their respective revenues have at least to be roughly proportional to the populations that they support.

New Harmony Utopian community designed by Owen

New Harmony Utopian community designed by Owen

Although in a socialist economy the great bulk of the economy is publicly run, the distribution of the population accross sectors of the economy continues to exert an influence as does the fact that the population still live in households. This may seem an unexceptional observation, but communist organisations that grew up within previous class societies dispensed with the household as an institution. Think of a monastic community or Owen’s New Harmony. In such householdless communities there would be no personal property as opposed to community property. Food preparation, was communal, and childcare was either abolished as in monastic orders, or carried out communally. But if you have households then private property of the household is distinct from community property. Since the composition and consumption needs of households differ, it is impractical to give all households a uniform ration of goods. An old couple would have little need for children’s shoes or toys, for example. So a socialist economy with households has to allow some flexibilty in consumption, which they have achieved by distributing a portion of people’s income in money. In principle they could have used something other than coins and notes. They could have kept social credit accounts or labour accounts for people, but in all cases, many goods for household consumption would have something very like a price.

In a socialist society then, with households, how does the esoteric aspect of the law of value, the underlying constraint posed by the social division of labour, express itself?

1.1  Intersectoral relations

I shall divide the socialist economy into three sectors

  1. The production of means of production.
  2. The production of articles of personal consumption that are distributed for sale or charge to individual workers’ families. At this point it makes no difference whether the articles are sold for actual money, or against the debit of a labour account.
  3. The provision of uncharged services such as education, healthcare, defence, and public infrasctucture. This is not to say that being conscripted into the army is not a charge on the conscript, but that they do not individually have to pay in cash or labour credits for their military service. Similarly education costs adult society time and resources, and costs the pupils their play time, but it is assumed that there are no school fees.

I will use the subscripts 1,2,3 to denote these sectors. Sectors 1 and 2 produce physical outputs, that is to say they are materially productive in the sense of Adam Smith’s use of the term productive. I will call the output of sector 1 machines, though it also includes all other means of production, and will use the symbol m, in lowercase to indicate a flow, for the gross output of machines and the stock of machinery and equipment used in the sectors as M1,M2,M3.

Machines wear out. I assume that a fraction δ of them wear out each year. So for the sectors the flow of new machines needed to simply stand still is given as δM1,δM2,δM3. If the economy is growing there will be some surplus flow of machinery over wear and tear, set asside for growth, which I will call mg.

mg = m −( δM1+δM2+δM3)
(1)

I will assume that the working population is P divided into P1,P2,P3 working in the three sectors, and that for each year of work the government credits a person with a wage of w either by paying them cash or by recording some units into their personal consumption account in a database. The state also, for budgetary purposes has to account for the usage of machinery and equipment in different sectors right down to the individual factories, hospitals etc. The accounting unit for such charging is assumed to be the same, either money, labour hours, concievably energy, as is used for personal consumption accounts. I will use c for the charging rate for a machine. This then gives the current accounting costs Ci of each sector, assuming that the government does not charge itself interest, of

C1=cδM1+wP1
(2)

 

C2=cδM2+wP2
(3)

 

C3=cδM3+wP3
(4)

The accounting costs of each sector are made up of the charge for the use of publicly owned machinery , and the payments to the people working there. The first is a charge internal to the public sector but the government has to carry out such sectoral charging if it is to make overall budgetary decisions about the scale of the sectors. The only point at which an actual sale, with change of ownership, happens is when the output of the consumer goods industry is sold to the working population. I will call this the bread or baking industry and label the total output of the industry b and the price of bread p. If we assume for the moment that there is no mechanism by which the working population can save, then we have

pb=w(P1+P2+P3)(1−t)
(5)

where t is the income tax rate. That is to say, the price of bread times the bread output equals the after tax income that the working population gets. This is their money wage but in addition they consume a social wage of education, healthcare etc provided by public sector 3. Equation 5 gives the price of bread as a function of the money wage.

It is not so obvious how the government should set the charge for machinery used by the public sector but one obvious way is to set the charge for machines at their imputed cost of production

c=C1/m
(6)

The tax revenue plus any profit on sales of consumer goods is then used to cover the cost of the free public services and the net accumulation of new machinery

cmg+C3=tw(P1+P2+P3)+pb−C2
(7)

We have 7 equations 1 to 7 with 8 unbound variables mg,c,w,t,p ,C1,C2,C3. I assume that m, b, M1,M2,M3, P1,P2,P3, δ are fixed by the actual structure of activity so in principle the government could fix either the tax rate or the wage rate, but having done that, all the other variables are constrained. Let us look at options.

I will present a simple example and compare the effect of different wage and tax policies.

Sector P M output
1 4000000 250000 100000
2 6000000 250000 1000000000
3 5000000 250000 no physical output
  1. The wage is fixed at 1, this ends up equivalent to valuing things at labour values, no profit is made on the sale of consumer goods and income taxes are adjusted to meet the cost of the public services and accumulation. We end up with
    p c t income tax rev turnover tax rev
    0.0073 53.3 51% 7666570 0
  2. In this scenario income tax is held low at 10% and the price of the consumer goods have to rise to cover the shortfall in government revenue. Given that the physical output of consumer goods stays the same, the only effect of reducing income tax is to increase prices. The net effect is that the goverment raises most of its income from what can either be viewed as a tax on consumer goods, or on the profits of nationalised industry. Wages turn out to be the same, as does the charge for means of production, but consumer goods cost almost twice as much.
    p c t income tax rev turnover tax rev
    0.0135 53.3 10% 1500000 6166666

    The relative prices of machinery and bread now diverge significantly from labour values, with bread being sold at a premium due to the tax being levied on it.

The conclusion is that the extent to which a socialist government can disregard labour values is constrained by the level of income tax that they levy. If they rely on income tax for public revenue, then sectoral prices will be proportional to labour values. If they attempt to curtail income tax to a level too low to support public services, then the price of consumer goods has to be raised in what amounts to a sales tax to prevent the accumulation of purchasing power in the hands of the public, and thus suppressed inflation.

1.2   Intra sectional constraints

Even if you assume that the number of people allocated to make consumption goods does not change, that still leaves considerable flexibility in what consumer goods are made. Asume the intention is to adjust output to consumer wants as expressed by the goods they chose to spend their social credits on. What does this imply for the relative prices of goods?

Should these relative prices correspond to relative labour values?

Yes they must, for it is only under this condition that the attempted adjustments people make in their consumption will be compatible with the pre-determined number of people working making consumer goods. Suppose that one group of goods – say furniture is systematically undervalued compared to another group of goods, let us say clothes. Suppose clothes are priced at par for labour values and furniture is sold at a 50% discount with respect to its labour value. Note that it does not matter if the social credits are measured in hours or in some arbitrary currency units, there will always be some quantity of the currency that, averaged accross all prices, represents an hour of embodied labour. Consumers then attempt to shift part of their clothes consumption to furniture. Suppose they cut clothes consumption by the equivalent of 100 million hours of credits, and switch these credits to furniture. Since the furniture is being marked at a 50% discount, these 100 million hours of credits switched from clothing appear to be enough to buy furniture that took 200 million hours to make. Even if the workers who in the past worked the 100 million hours in the clothing industry were shifted to make furniture, that would not provide enough additional labour to make 200 million hour’s worth of chairs, tables etc.

More generally, if prices are not proportional to labour values, then shifts in purchases from one good to another will lead either to patterns of demand that to big to be met with the existing workforce, or if the demand shift goes from undervalued to overvalued goods, to unemployment and short time working in the consumer goods industry.