Date: Sat, 4 Oct 1997 19:48:27 +1000
From: Rob Schaap <rws-AT-comserver.canberra.edu.au>
Subject: Re: M-TH: Wall Street


G'day Rakesh,

Crucial questions, with which I shall take some liberties.  You asked:

>2)Is there anything to the distinction between predatory and productive
>capital? Does it have resonance today both in ideology or even in real
>relations?  How have they been or not been integrated (Grossmann, drawing
>on Alfred Weber, and Mattick considered it a false opposition)? What leads
>to the fetishization of productive capital and the demonology of money?
>3)How does Doug's Marxist critique of Wall Street and the most fetishistic
>forms of capital teach us to counter reactionary populist or petty
>bourgeois ideas about the power of money?

I might miss the point a little, but I really am hung up about a couple of
long-held concerns that came back to the surface as I read your posts.

I shall argue the distinction between predatory and productive capital is
not necessarily central to the socialist, that 'productive capital' is
every bit the enemy 'unproductive capital' is, and that this is a function
of capitalism's characteristics of market exchange and concomitant
individualised consumption.  This blather applies to stock market thuggery
as it does to all else.

Capitalism can not distinguish, for any practical purposes, between good
and bad capital.  I shall probably get my head bitten off for quoting the
renegades Albert and Hahnel (*Unorthodox Marxism* - a terrific read if you
can handle compelling denials of some stuff you've long held dear - and
even I, a relative newbie without life-long emotional and intellectual
investments to protect, have been finding it unsettling), but the first bit
I quote is uncontentious for us all:

'In market transactions the balancing of costs and benefits goes on only
between buyer and seller.  If people beyond the buyer and seller are
affected, if for example, there is more than one 'consumer', then market
exchange which treats commodities as if there were only one consumer, that
is, as if the use of commodities were equally as 'alienable' as their
ownership, cannot be expected to generate an accurate evaluation of goods
... In other words, the market process misestimates the human worth of
commodities whose 'consumption' has use-value for more than one economic
agent because it does not provide means for joint, or social expression of
desires.'

So, individualised consumption, the logical corollary to the commodity
form, is *the* problem.  As A&H cogently declare: 'Consumption activities
give people as much pleasure as is to be had in the social settings they
inhabit and yet simultaneously help to reinforce those settings in their
most debilitating aspects.'  Under capitalism, by definition a process by
which commodities are sold by isolated individuals to isolated individuals
(as seems both theoretically necessary and hegemonically dominant), that
which is 'productive' must in fact reproduce precisely this theoretical
necessity and hegemonic dominance.  That which is 'unproductive' is
objectively no different (and can even be seen as productive from a
political point of view, in that what is disguised by the 'productive' is
more accessible in the 'unproductive' - ie.  sensibilities such as the one
I'm trying to articulate here).  I wonder if I've annoyed any market
socialists who might be listening?  (And no, I still haven't got
Schweikart's book - but I will - promise.)

I mention all this, because the implicit totalitarianism you quote for us
is evident in the dangerous argument that: (a) there is good and bad
investment; (b) good investment is that which employs and feeds (creates
whatever real use values are du juour) while the bad is that which does
not; (c) I can make the distinction in each case (this silly lad may see it
along ethnic lines, but that's not what I'm on about here); and (d) you
need someone who can see this and who'll do away with the bad investment,
thus adding this liberated balance to the good.

A socialist who says this (I think Louis Proyect takes this line, but if I
misrepresent him I apologise - how's that for a cheap way to ensure an
ongoing thread?) is aware that 'externalities' (as mainstream economists
name the fall-out from private exchange described above) are either
inevitably present or usually present in market exchanges.  S/he's still a
totalitarian-in-effect (as opposed to 'by-intention') though, as s/he's not
addressing the question of how, in the absence of the fabled but
discredited price mechanism, the social welfare function is to be
determined.

The central planner points to the awesome power of parrallel-computing in
doing the job the stock markets demonstrably do not do (Doug's book is
*still* not available in Australia, btw).  But this compelling technical
argument still neglects the following:

'Although it would be possible to elect the central planning board to
accord with the fullest of known democratic principles, to conclude that
this would resolve the problem is to miss the point.  Self-management does
not mean electing some person or agency to make our decisions for us.  The
inter-unit mechanism of central planning is an institutional boundary that
delimits workplace and neighbourhood self-management. It doesn't provide
local councils with information concerning all the human gains and losses
associated with the inputs each council receives from the others, nor with
the human consequences of the outputs each provides to all the rest.  And
it does not provide a vahicle through which councils can propose and
collectively decide upon activities based upon knowledge of their full
consequences.  In stead central planning embodies as a core characteristic
an authoritarian command relationship, which, if it persists, can only
eventually erode any self-management characteristics that might be
initially present within the economic councils or any broader political
sphere.  For it very quickly becomes evident to any central planning
authority that it is easier to give instructions to a *manager* and hold
him responsible for carrying them out then to try and deal with worker's
committees.  And once this is done, the manager must obviously be granted
powers over the work process.'

'The road to hell' and all that.

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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