Date: 	Tue, 20 Sep 1994 02:18:19 -0300
From: jinigo-AT-inscri.org.ar (Juan Inigo)
Subject: Re: Positive side to anti-LTV case


Steve Keen writes:

>To repeat the
>quote I made recently in reply to a posting by Juan Inigo, this
>insight exists in the following comment by Marx on Ricardo in TSV
>Part II:

I haven't received the message Steve is referring to. Could it be reposted,
please?

Still, Steve has finally presented (in the message where this reference was
made) a positive foundation to his claim:

>The theory of value I put forward reaches the conclusion
>that all inputs to production can be sources of surplus value
>to the capitalist.

Here it is:

>The capitalist buys inputs to production at their exchange-value; their
>objective use-value is irrelevant to the price he pays for them. In
>production, he exploits a commodity's objective use-value--which is
>its ability to produce new commodities. Whereas in normal consumption,
>use-value is qualitative, in the case of productive consumption,
>use-value is quantitative. Since the exchange-value of a commodity
>and its use-value are unrelated under capitalism, there will be a
>difference between the two, and this difference is the source of
>surplus value.


Let's consider Steve's claims a little bit slower:

>The capitalist buys inputs to production at their exchange-value; their
>objective use-value is irrelevant to the price he pays for them. In
>production, he exploits a commodity's objective use-value--which is
>its ability to produce new commodities. ...

Let's follow Steve's argument in his own terms: _the exploitation of
commodities_, _the ability of a commodity to produce new commodities_. What
Steve says concerning "the capitalist" can be said concerning "the private
independent producer that simply produces commodities". If the former is
replaced by the latter in Steve's assertion, this assertion goes on making
exactly the same sense. There is just a difference: labor-power is the only
"input" a simple private independent producer doesn't buy. But if we are to
accept Steve's assertion that there is no difference concerning the
production of surplus-value between the use-value of labor-power and that
of the means of production, we have to take the fact that the simple
producer of commodities doesn't buy labor-power just as an accidental
circumstance. At most, we can specify the ability of inputs to produce new
commodities, by saying that the means of production have the ability to be
used as the means for living-labor to produce new commodities, and that
labor-power has the ability to produce new commodities by putting those
means of production into action when it transforms itself into living
labor. The ability of the means of production to produce new commodities
remains unchanged, whether they are used by a waged-laborer whose
labor-power was bought together with them or by the independent private
producer that purchased them.

Let's take, for instance, a hammer. The ability of a hammer to produce new
commodities, is completely independent from the fact that it's productively
used by a waged-laborer or by a private independent producer. The social
determination of the arm that "exploits" it is something that has no way of
getting into the iron-headed hammer. Moreover, if its ability to produce
new commodities differs even in an ounce of shavings from one case to the
other, then this difference would not concern the hammer itself, but the
social nature of the hand that holds it. But, in that case, a difference
would arise between the hammer as an input to production and the
labor-power as an input to production, and this would mean the end for
Steve's theory.

Of course, Steve has previously tried one of his typical ambiguous
assertions to avoid this point:

>Under pre-capitalist society, when trade initially occurred, it
>is quite feasible that the "utility" of what was exchanged affected
>the price. Two cultures meeting "at the border" exchange superfluous
>items which are peculiar to each culture, and the eventual price set
>may well reflect subjective valuations of the goods.
>
>However, as trade becomes routine, commodities are produced not
>for the satisfaction of the individual producer, but for exchange
>and profit. The cost of production becomes the dominant factor
>in determining price, and the use-value of the commodity is
>irrelevant. This is step one in ridiculing the neoclassical
>perspective: it is really an analysis of pre-capitalist exchange.

"it is quite feasible", "may well reflect". Maybe this is what Steve thinks
chaos theory means to scientific precision! _It is_ or _it is not_? _It
reflects_ or _it doesn't reflect_? Steve's ambiguity is essential for the
sake of his theory. To settle the question, he must choice between saying
that:
a- "utility" actually is an essential component of exchange-value in
"pre-capitalist exchange", thus openly coinciding with the _ridicule_
"neoclassical perspective". But then nobody would give a dime for his
assertion that his theory truly follows Marx's path.
b- "utility" actually is just an accidental circumstance concerning
exchange-value in "pre-capitalist exchange", thus openly accepting that
exchange-value (its transformation into price of production is obviously
out of the question at this stage) has exactly the same essential
determinations in what he calls "pre-capitalist exchange" and in
capitalism.

Instead of solving this dilemma, Steve produces one of those magic tricks
his uv-ev dialectics is so prodigal in: "as trade becomes routine,
commodities are produced not for the satisfaction of the individual
producer, but for exchange and profit." That is, "as trade becomes routine,
commodities" (which in fact are never produced for the direct satisfaction
of their individual producer, as they are non use-values for him/her) jump
from being the products of "Two cultures meeting "at the border"", to
become at once the products of capital, that is, "are produced ... for ...
profit." It seems that Steve really hates mediations.

>From a historical point of view, the transition from "Two cultures meeting
"at the border"" to the rise of capitalism as the general social relation
of present-day society, has had at least 50,000 years of human life to left
"utility" out of the determination of the exchange-value of the simple
commodities. And, aren't there in the society where Steve lives any
peasants, artisans, or independent professionals that produce use-values
only for others as the sole objective of their productive labor? Or do
independent dentists evaluate the possibility to consume on themselves the
use-value, the "utility", of their professional work each time they have to
establish the exchange-value of pulling out somebody's teeth?

But there is a point of view still more important: when we attempt to
discover the determinations of capitalist society, can we avoid starting
from their simplest specific forms, which means, starting from the simplest
social form commodities have? (just recall  Marx notes on Wagner). Marx
didn't devote Capital's first part to some "ridicule" "pre-capitalist
exchange" but to the simplest specific social forms of which capitalism is
the necessary concrete development.

So, as Steve has left the issue open and he enjoys alleging that he is
following Marx, he can't claim we are no longer following his (Steve's) own
developments when we find that "utility" is not a determination of the
exchange-value of simple commodities.

>... Whereas in normal consumption,
>use-value is qualitative, in the case of productive consumption,
>use-value is quantitative. Since the exchange-value of a commodity
>and its use-value are unrelated under capitalism, there will be a
>difference between the two, ...

In Steve's terminology, "normal consumption" means "individual
consumption", as opposed to productive consumption. As I have shown again
and again, use-value an exchange-value are always both qualitatively and
quantitatively determined. What happens is that each of their
determinations plays a different role along the different moments in the
process of the production of commodities. Still, it doesn't matter here.
Let's assume for a moment that Steve's assertion is worth for what it says.
Then it should correspond to labor-power and to the means of production
alike. So when a simple producer of commodities purchases and productively
consumes the use-value of a hammer, we must take for granted that this
"use-value is quantitative". And of course, "since the exchange-value of a
commodity and its use-value are unrelated under" the production of simple
commodities, "there will be a difference between the two,"

>... and this difference is the source of
>surplus value.

Oops! If we are to follow Steve's positive exposition of his theory we must
unavoidably conclude that surplus-value exists even when the means of
production don't have the social form of capital but of simple commodities!
Ricardo presented the primitive hunter and fisher as taking into account
the rates of interest to finally set the price of their "commodities", but
he never was so blind to say that surplus-value or profit was present in
this exchange. Of course, as Marx points out, in Ricardo's day there still
existed the possibility for classical political economy to advance on a
scientific base, instead of becoming the plain apologetics of capitalism.

There is no logical way out for Steve's theory from here on. If he openly
claims that surplus-value exists prior to capital, the nonsensical content
of his theory would be obvious. If Steve agrees that surplus-value only
belongs in capitalism, then he has to accept there are two different
situations, capitalism and the simple production of commodities. In both of
them, the determinations concerning the commodities that enter production
as the means of it, are the same. But these situations have a twofold
difference. In the former case, we have the purchase of labor-power and
surplus-value. In the latter, neither of these appears. Unless Steve wants
to deny the elementary primacy of the _caeteris paribus_ principle in
theoretical analysis, (who can actually say what Steve's uv-ev dialectics
is not capable of) then surplus-value must be related only with the
purchase of labor-power.

Maybe Steve could turn the problem upside-down and claim that surplus-value
is absent in the simple production of commodities and present in capitalism
because the different aim pursued by the purchase of the means of
production, or "inputs", in each case. In the latter, the means of
production are purchase to make a profit out of them, in the former, just
to produce a new commodity where their value would be preserved. This
answer does nothing but to place, as the solution to the problem, the very
problem that has to be solved: where does surplus-value, profit, come from?
If it comes from the intention to produce it, it would be just a question
of willing hard enough. We all know perfectly well where does this rubbish
belong. (Still, this inversion indirectly appears in Steve's posting, but
later)

Maybe Steve would like to claim that the difference arises as a consequence
of being all the use-values in which capital is materialized the opposite
to capital, and that this opposite must be the source of surplus-value. But
then he will get into some grammatical troubles with what he
euphemistically calls his "abridged", and I have shown cut-out, quotation
of Grundrisse.

So, Steve himself makes the point for the only scientific path still opened
in front of where his own analysis has brought us: surplus-value must arise
from a specific determination that the input labor-power has among
commodities. No wonder Steve gives the case of labor-power as the only
example of his theory about the sources of surplus-value. Why didn't he
take a modest hammer instead, thus really supporting his point of view?
Nobody in the discussion has questioned the capacity of labor-power to
produce surplus-value, but the capacity of the means of production to be
such source.

Nevertheless, the social necessity that Steve personifies is strong enough
to make him develop his "logically inconsistent" theory further. The social
necessity I personify makes me see in this development a relevant case
concerning science as a necessary form of political action. So I will
follow Steve through the developed forms his theory takes concerning more
concrete social forms in a forthcoming message to the list.

Juan Inigo
jinigo-AT-inscri.org.ar



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