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V. Grey

Shop Talks on Socialism

Machines Create No New Value

(24 August 1946)

From The Militant, Vol. X No. 34, 24 August 1946, p. 6.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Here is a steel plant worth a hundred million dollars. Thousands tons of steel are produced each day in this plant The product is worth hundreds of thousands of dollars.

What is happening to the plant itself as the products come rolling out the gate? What is happening to the plant while the ten thousand workers are producing surplus value for the owners?

Why, the plant is wearing away. Bit by bit, rust, corrosion, decay, wear and tear – all take their toll. You see machinists, millwrights, riggers, pipefitters always repairing and replacing. (In the blast furnace department, for instance, there are over a hundred maintenance men, with only about a hundred and fifty workers actually operating the furnaces.) Every so often a whole furnace is relined and rebuilt. Shops are torn down or remodeled. Mills grow old fashioned. New ones replace them.

Company-owned lake boats bring ten to twenty thousand tons of ore in a load. The weird “leg” unloaders that dip down into the hold like men-from-Mars, scoop up twenty tons at a grab, and a hopper sifts their load onto a moving belt to the huge piles of ore in the rear. They unload the limestone in the same way.

Behind the “legs,” up skyward over these mountains of ore and lime are the “bridges.” These are cranes on straddled stilts 60 feet high, running back and forth to pick up more tons of lime and ore for the waiting gantry cars on the trestle, still further inland, parallel to the ore piles. These cars rumble up and down the trestle day and night – loading and dumping their twenty tons or so every few minutes. Everything clatters, bumps and wears out.

The stock house below the trestle receives the loads of lime, coke and ore into its bins. And still another group of “larry” cars run up and down inside the stock house – getting their smaller loads from the bins above. They stop opposite each furnace and spot their loads above the waiting “skip” cars, which take the stock up to the top of the furnace, five and ten tons at a time.

So before the stock is even put into the blast furnace for its first operation, millions of dollars of machinery handles it, and wears out in the process.

Then the million and a quarter dollar blast furnace blows, burns and blasts the stock. It coughs up the slag and finally pours the molten iron. Huge ladles, each mounted on eight railway car wheels, receive the iron below the furnace floor. Steam and Diesel locomotives pull the live iron to the Open Hearth.

The Open Hearth has machinery almost as tremendous and expensive as the blast furnace. The charging machines which lift up the “coffin” boxes full of lime or scrap steel, turn them over, knock them against the side of the door to be sure they are empty; the overhead cranes which pick up small ladles of live iron and pour them into the furnace; the locomotives which also run up and down, the Open Hearth floor.

When the “heat” is tapped and the new steel leaps into the pit behind the Open Hearth Furnace, a huge 80 ton vessel receives it into its battered sides lined with clay and brick. A hundred ton crane overhead picks up this full ladle, and pours the liquid steel into ingot moulds on flat cars.

After all this, the resulting steel ingot, with its iron ore, coke, limestone, carbon, silicon, sulphur and sometimes other things as well is only worth around 80 dollars a ton! And these materials have gone through machines and processes costing millions upon millions of dollars.

Instead of saying that machines produce profits by themselves, you might almost say, “How on earth can the company afford to sell steel for 80 dollars a ton when they use up such expense machinery?”

But there are thousands of tons produced. For each dollar of value worn away in the machinery, a dollar of value reappears in the steel product; and a mew value appears above this, which is added by the creative human beings who run the machines.

The corporation enters this in its bookkeeping. The money it takes in which represents the surplus value produced by the workers, it calls “profits” or “dividends” and pays them to the owners. The money it takes in, which represents the value of the worn-away machinery, it lays aside and calls a “sinking fund.” If it takes a machine or a furnace ten years to wear out entirely, then the sinking fund must contain one-tenth of the machine’s value each year and purchase a new one at the end of ten years.

U.S. Steel, for example, has to produce and sell fifteen million tons of steel a year before they start making a profit. The enormous machinery they have to replace will wear out in a few years whether it produces steel or not.

The machinery and plants of U.S. Steel do not produce any new value. Not only that. If less than fifteen million tons of steel can be produced, these machines and plants are a liability.

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