From: "John R. Ernst" <ernst-AT-pipeline.com>
Date: Fri, 24 Nov 1995 05:23:29 -0500
Subject: Three J's


Dear Chris, 
 
I hope you don't mind my chopping up your 
post a bit as I respond.  
 
Chris says: 
 
While I have not been able to follow all the details, I very much welcome 
that John, Jim and Juan have been continuing to slog out the value 
of the Marxist concept of the law of value.  
 
My standpoint is that we need a non-reductionist, non-mechanistic  
rediscovery of the relevance of the LOV  for commodity-based  
exchange value, *within the wider global set of all socially valued human 
relations* 
(value in its widest sense). 
 
As hopefully a reasonable intelligent non-economist I would like to  
risk quadrangulating briefly in the debate. 
 
John says: 
 
Well, I do think that the three of us would 
agree on one thing -- the devil is in the  
details on this one.  Neither Juan nor Jim 
have allowed me to gloss over a single  
issue -- even when I might want to argue  
the pro-gloss position.  But all of us should 
be clear on one thing -- quite a bit is at  
stake.  We're talking about whether or not Marx 
had brains enough to make an intelligent argument. 
We are agreed, ultimately, that he did.  But, 
given what we've posted, it is an assumption. 
In other words, I do not think you chop up CAPITAL 
and pick and choose where Marx is right and where 
he is wrong and call it a coherent work.   
 
Chris says: 
 
I welcome John's willingness to concentrate on the issues, 
and to ignore some of Juan's sharper remarks personally. 
I also welcome as good practice his attempt to go Back to the  
Beginning to redefine more accurately the problem over which the  
argument is taking place. However I suspect there needs 
to be more clarification of exactly what the problem is that 
people are arguing over. 
 
(Quoting John)  
  
2. What's basically at issue is the notion of a  
    falling rate of profit in Marx's work.  What   
    I am saying is that nearly everyone who reads  
    Marx, using the common definitions of value,   
    concludes that Marx is wrong.   
 
 
Now I thought, John, that it was accepted in previous debates 
on this list that what people were arguing about was Marx's 
description not of the falling rate of profit but of the *tendency* 
of the rate of profit to fall. Further that Marx and his followers 
recognize countervailing tendencies. So that the net result 
may be a fluctuating pattern of rate of profit resulting from  
many different factors. 
 
John says: 
 
I am "pro" countervailing tendencies.  There are  
right there in Marx.  But they are not worth much 
if to get the rate of profit to fall, you need: 
 
a.  a theory of technical change that demands  
    capitalist innovation take the form of  
    Rube Goldberg designs.  
 
and/or  
 
b.  your theory of how the rate of profit falls 
    depends upon "greedy" workers who demand  
    higher wages. 
 
Now, none of us believe this but given the manner 
in which Marx is commonly read by economists and 
in which their students are "taught" Marx, this  
is the state of things.   
 
I do not know on what basis folk "on this list" 
came to conclusions about countervailing tendencies. 
It would seem premature as the there is no law  
established (commonly understood) save under  
"a" and "b" above.  I can't believe the members 
of this list consciously swallowed those conditions 
and then moved to countervailing tendencies. 
 
 
Chris says: 
 
I think the problem should be defined differently at a higher 
macro level to that at which you bravely attempt to pitch it: 
That Marx's general and concrete description of the laws of  
working of the capitalist economy describes with remarkable  
relevance still today, a system that in his time appeared for  
various reasons likely to become more and more  
polarized, so that increasingly frequent crises would herald 
a total qualitative change to another system.  
 
The problem however for us is that on re-reading, Marx's  
economics also describes a system that can accommodate to  
social pressures for example over factory legislation and the  
division of exchange value between workers and capitalist  
accumulation.  Marx describes a complex dynamic  
self-reproducing self-perpetuating system, in which  
one but only one of the motions, is a *tendency* of the  
rate of profit to fall, but there are many other tendencies too. 
 
John says: 
 
What Juan, Jim, and I are discussing is ultimately  
extremely fundamental.  Indeed, Juan correctly (I think)  
asserts that the argument can be traced back to the very 
beginning of CAPITAL itself.  As far as I know, Marx spoke 
of one and only one "economic law of motion of modern  
society" and the FRP and its causes and countervailing 
tendencies certainly make up a big part of that law, once 
fully understood and expressed.    
 
 
Chris says: 
 
The problem is paradoxically that if we  understand more  
fully, more dialectically and more materialistically, the workings 
of the capitalist economic system and why it is so resilient, that 
is the necessary theoretical condition to start  bringing it politically, 
under social control, and in the widest sense, social ownership. 
 
Is that not the problem? 
 
John says: 
 
I'd agree with this.  But what does it say?  The three 
of us are going at to get a better understanding of how 
capitalism works.  All of us, I am sure, wish that matters 
were clearer.  But they are not.  None of us gloss over  
things by telling one another to understand things -- "more 
dialectically and more materialistically."  We're still  
doing some basics -- hopefully, in that fashion.   
 
The sad thing is this is, more or less, the state of the art. 
Any economist who wants to jump beyond the problems we are 
dealing is, at best, mistaken; at worst, stupid.  I suppose 
we could chuck it in and say Marx was a precursor to Keynes 
or to some post-Keynesian thinkers;  but then we'd be less 
than honest as we have assumed Marx is relevant to the  
situation of today.    
 
Should capitalism find itself opposed by significant 
forces, it would be nice if we knew how capitalism itself 
operated. Given our working hypothesis that Marx can  
help us in this quest, we continue. If we are taking up 
too much time and space on the list with all this, please 
tell us.  None of us seem willing to let go and I'm sure 
we could find space elsewhere.  


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