The tendency for the rate of profit to fall is a famous theory advanced by the classical political economists, particularly Marx. He believed that this tendency was the result of an ever increasing level of fixed capital, the result of capitalist competition and the necessity to expand production. The rate of profit equation is S/(C+V), where S stands for Surplus (profit), C stands for constant capital (machinery and non-labor inputs), and V stands for variable capital (labor inputs). Therefore, in Marx’s formulation, the rate of profit would tend to fall in the long term, despite temporary counter-tendencies, due to an ever increasing magnitude of C relative to S and V.
"Unless we begin to see capitalist consumption as a share of surplus begin to fall again, we will not be seeing ... the development of Capital into a force pushing us beyond the limits of capitalism.
I have to challenge this last assertion.
"Unless we begin to see capitalist consumption as a share of surplus begin to fall again, we will not be seeing ... the development of Capital into a force pushing us beyond the limits of capitalism.