Date: Sun, 26 Oct 1997 23:20:50 +1000
From: Rob Schaap <rws-AT-comserver.canberra.edu.au>
Subject: Re: M-TH: The Next Thinker: The Return of Karl Marx (The New


G'day Kevin,

You write:

>    Though the qualitative content of the LTV and HM, if we use your
>definition of HM as the Marxist economic theory, implies a quantatative
>analysis if we are going to give a sound meaning to terms like exploitation
>and the creation of value.

[I guess I'd brought up the HM-context angle to highlight the role of the
dialectic, both in constituting the dynamics under investigation and
bringing into question formulaic representations.  As I (sort of) see it
now, a dialectic view is a view that must deny the transcendant - there's
no human place from which, and no human phenomenon about which, a
history-independent truth can be made (other than this one?).  I'm not
getting post-structural on you (there is, for me practically absolute truth
in every proposition that is as true as it can be); I'm just saying that
particular complexes produce every moment.  If you are discussing a
predominantly capitalist mode of production, the theory/praxis link
requires that only then can capitalism usefully be discussed.  As
capitalism itself is ever transforming, the next step is to avoid
conflating real time and mathematical time.  All is process, and
*everything* is changing during the time it takes to get from any apparent
independent variable [eg. L(1)] to any dependent variable [L(3)].  It is
upon the basis of this sensibility, I think, that reg. school thinkers deny
the possibility of prediction but maintain that of explanation of any past
(is that right, comrade comod?).  So here codified magnitudes are
problematic at two levels.

(1) They are not a formula applicable at any time other than when they fit
all the apparent and selected phenomena that characterise that moment, and

(2) they are necessarily limiting the operational scope of agentic
phenomena because the logical inability to test reliability across time
[see (1)] means that you can't correct for previously neglected magnitudes
to hone your formula.]

>    Take the case of the use-value of labor power: the use-value of labor
>power is defined by what it can produce for sale on the market. By this
>definition, the use-value of a certain quantity of labor-power changes based
>upon its capability to contribute to the production of commodities with
>exchange values. This use-value of labor is thus socially-determined by the
>capability of technology and coercive management to contribute to the
>commodity output of a fixed quantity L of labor. This creates the
>possibility of trying to discover the individual contributions of a set of
>labor inputs L(1), L(2), L(3), etc. to the final product so that we can say
>L(1) a manager, contributed X(1) amount to the final exchange-value by
>improving the productivity of L(2) a worker whose input becomes X(2) and is
>passed onto L(3) for the contribution of her marketing expertise towards the
>realization of exchange in the market, and the surplus value arising from
>this labor is passed onto L(4), a capitalist who realises surplus-value S.
>Thus value-theory can be expressed as a marginalist table of formulas:
>
>(X=contribution to the creation of value by one person in the division of
>labor)
>
>X(1)+X(2)+X(3)+X(4)+S= final exchange value of commodity

[This is a helpful pedagogical move, given the way we learn things at the
academy today - and good on you.  How much more than that is it, do you
think?],

>    This possibility seems to be a direct implication of a qualitative
>theory of labor inputs, and its interesting to figure out the success of
>this sort of reduction to mathematics on this issue and others in the LTV
>vocabulary. In some realms with high standards of truth, like the academic,
>it may be necessary.

[True.  But does this standard of truth not require that an understanding
of the implications of dialectic as I understand them above (and this is
guess work I'd love critiqued) obviates mathematical reductions?]

>    One concern of mine with your 10-point summary of Marxist Political
>Economy is it ignores the ethical aspect that forms a crux of Marxist
>analysis: that the oppression of workers (and perhaps the environment) in
>the process of the realization of profit is unnecessary. There has to be
>more goodies in Marxism for workers than the avoidance of economic cycles of
>underconsumption, and some ultimate, though uncertain, breakdown of
>investment, production, and consumption. There is more to it than crisis
>theory.

[Absolutely, fundamentally, and crucially right!  I saved the stuff you and
Justin contributed on this last year (you'll remember I tried to posit an
interpretation of it on  M-I last year).  I must incorporate this, and
will.]

>    Point (6) is confusing. It speaks of the determination of exchange value
>in a strange vocabulary of "affordability."

[Yep.  I was talking crap.]

>    The exchange-value of labor power is less than the use-value because of
>the unequal bargaining position of capitalists and workers; the differential
>relations of property and resources in society. Propertyless workers cannot
>survive without securing an agreement for wage-employment with
>productive-property owning capitalists. Capitalists, because there are many
>workers competing to work for relatively scarce employment, can hold out for
>their best deal and buy labor-power at a near subsistence-level (it's
>important to define what you mean by subsistence since many associate
>subsistence with immiseration), or often below it. Significant barriers
>exist that make it very difficult and risky for individual workers to become
>small or large-scale capitalists, and certainly it is not the case that the
>entire class can do so. Capitalists ultimately rely upon non-self-sufficient
>labor to maintain their existence.

[Yep.]

>    Marx is, rightly, emphatic that there is no "exchange value" intrinsic
>to labor-power. The exchange-value of labor is socially determined through
>bargaining for contracts and prices. It is important to emphasize that there
>is no permanently fixed value for certain types of labor: i.e. that
>secretaries make $20,000 a year when they first begin working for a firm,
>and as they gain seniority they eventually max out at $35,000. There is
>nothing substantive other than contracts negotiated between agents. Changes
>in wages in contracts are the result of a gain or loss of competitive
>bargaining advantage for worker or capitalist. Workers can take collective
>action to fix prices at which they individually agree not to work below, as
>in trade unionism, and may also gain the sympathy of political apparatuses
>which can give workers a certain social safety net that will give them a
>competitive advantage, or guarantees against the breaking of strikes - which
>is ultimately the decision of individuals to break the collective agreement.
>Thus there is a rational-choice aspect here that is useful to use to clarify
>this whole thing.

[Useful, perhaps.  I've got warning bells going off though  (Rawls reckons
rational choice gets you a comfortable lumpen proletariat; Habermas implies
something like it gets you ideal speech situations; and Marx implies it
gets you class consciosness.  Maybe I'm being too rudely general re,
'rational choice'.  If not, RC theorists have to explain the 0/3 we've
scored on this test.  I'll have a think.  Maybe you have time to clarify
the clarification?]

>Capitalists have a motivation to run a
>cost-benefit analysis to figure out how much variable capital they can
>afford to replace with constant capital. Or how they can get more out of
>their variable capital. (8) and (9) therefore miss Marx's distinction
>between the relative increase of surplus value and the absolute increase of
>surplus value. The relative increase enters in the case of management
>theory, and all forms of speedups. The latter in the case of the replacement
>of variable (living-labor) capital with constant (machine) labor.

[This sounds important.  Which is a pity as I'm not quite understanding
this.  A few words?]

>    Moreover, capitalists engage in competition for *both* labor and the
>material resources which labor interacts with to create products with useful
>use-values, like computer processors from silicon. Thus Marx's comment in
>the conclusion of the chapter on Large-Scale Machinery in Capital 1 about
>capitalism undermining the roots of all value, the soil and the laborer.
>This is really important to emphasize; especially with reference to
>environmentalism. If you want more on the applicability of Marxism to
>environmentalism, you should read James O'Conner.

[You're overestimating me, Kevin.  Expand please.  The marking is nearly
over and O'Connor is one of the five books I shall take on my Chrissy hols
(Postone, Schweikart, Bhaskar and Henwood are off to Tasmania as well).]

>    (10) sounds odd, since profits are (it is widely thought) increasing as
>technology is increasing. To talk about the LTV in these terms you need to
>either put some stats together, along with a rebuttal of common explanations
>about why the rate of profit does'nt fall, or that crisis of
>underconsumption can't occur: i.e. Say's Law. Maybe Rakesh can forward
>something he's written on this.

[Doug's book is waiting for me at the book co-op.  I'll start there in
getting a better handle on FROP in our time.]

>You seem to show a lot of doubt about this at the end of
>this message with your comments about the potential of the seas and space,
>and the demonstrated capacity for capitalism to bounce back from crises. I
>don't think that capitalism is doomed. Many Marxists don't think so.

[Like whom?]

>there is a quantative aspect that is significant in refining, confirming, or
>altering the economic model that is formed in this qualitative description.
>I guess I just don't buy this strong distinction between qualitative
>description and quantatitive description;

[I've not bought the distinction yet, but I've made a substantial deposit.]

>    Remember: labor does things to nature to be productive, that is make new
>use-values out of natural resources. Thus nature is a necessary factor of
>production. There would be no production without labor, but there would also
>be no production without resources.

[Yeah, but nature, at any moment, can't help but be there, can it?  The
labour is but a potential, and its social form is what we're on about.
It's the bit where human agency comes in.  Exchange value, at any moment,
can only come from labour already done (ie commodities) or labour that is
to come (say, services, futures, or a block of land).]

>To have another factor of production
>besides labor does'nt mean that capitalists have to come into the fray. But
>they do when we start to talk about how capitalists compete for nature's
>resources.

[I'm not saying nature isn't a factor of production - I'm saying *labour*
isn't a factor of production.  Labour *is* production.]

>Of course it's solvable. Here considerations of supply, demand,
>competitive advantage, and monopoly come into the picture as a determinate
>of how much surplus value can be realized above the cost of labor and
>capital in a market. Is there something anathema to Marxist political
>economy, or just good political economy, here? Am I missing a problem with
>this simple speculation? The degree of surplus value that can be realized is
>dependent upon the price of a commodity which is reliant upon market forces
>in the consumer, i.e. consumption demand, and productive, i.e. wages,
>realms. These two realms are interconnected in ways that Marxist economic
>theory, as well as all economic theory (especially non-Marxist economics
>after Keynes) tries to explain.

[I don't know yet.  I'm just too bloody confused.]


Thanks a lot, Kevin.  This is doing me the world of good.  I just hope I'm
not wasting your time (or that of anyone else who's got this far).

Cheers,
Rob.


************************************************************************

Rob Schaap, Lecturer in Communication, University of Canberra, Australia.

Phone:  02-6201 2194  (BH)
Fax:    02-6201 5119

************************************************************************

'It is questionable if all the mechanical inventions yet made have
lightened the day's toil of any human being.'    (John Stuart Mill)

"The separation of public works from the state, and their migration
into the domain of the works undertaken by capital itself, indicates
the degree to which the real community has constituted itself in
the form of capital."                                    (Karl Marx)

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