[OPE-L:2429] Re: Re: Re: Re: Re: Re: the employment contract and capitalism

From: Steve Keen (s.keen@uws.edu.au)
Date: Sun Feb 27 2000 - 15:48:23 EST

[ show plain text ]

Hi Riccardo,

I agree that it was not truly 'populist', but I would argue that it was
more populist than the Contribution in that Marx did not try to use a
purely dialectical mode of presentation.

Though you refer to "first chapter" and "second edition" Riccardo--did you
mean "first edition"? If so then I'd like to hear more, since I haven't
done any variorum research on Marx.

At 09:21 AM 2/27/00 +0100, you wrote:
>Capital, first edition, was not truly 'populist', certainly not more
>'populist' than the Contribution. Look at the first chapter, which was very
>different from the second edition, and much more 'dialectic'.
>At 23:42 +0100 26-02-2000, Steve Keen wrote:
>>Thanks Nicky,
>>Yes, it's a fair comment that Marx's exposition of the commodity is Capital
>>is less clear, and less obvu\iously central to his analysis, than in other
>>works not written for publication.
>>The possible cause of this is that Marx was disappointed by the reception
>>accorded to "Contribution"--which he refers to as the "Preface to Capital"
>>in "Wagner". He thought it would shake the foundations, but it was regarded
>>as obscure by friend and foe alike.
>>So he tried to improve the reception of Capital by making it more
>>"populist"--and in that, he undoubtedly succeeded. We wouldn't have OPE if
>>he hadn't. But he obscured his fundamental dialectical logic in the
>>process, and it's much clearer in Wagner, the Grundrisse, etc., than in
>>Capital I.
>>One of the best such statements is almost the final word in the Grundrisse,
>>which Marx marked "to be brought forward":
>>"The first category in which bourgeois wealth presents itself is that of
>>the *commodity*. The commodity itself appears as unity of two aspects. It
>>is *use value*, i.e. object of the satisfaction of any system whatever of
>>human needs. This is its material side, which the most disparate epochs of
>>production may have in common, and whose examination therefore lies beyond
>>political economy. Use value falls within the realm of political economy as
>>soon as it becomes modified by the modern relations of production, or as
>>it, in turn, intervenes to modify them... Now how does use value become
>>transformed into commodity? Vehicle of *exchange value*. Although directly
>>united in the commodity, use value and exchange value just as directly
>>split apart. Not only does the exchange value not appear as determined by
>>the use value, but rather furthermore, the commodity only becomes a
>>commodity, only realises itself as exchange value, in so far as its owner
>>does not relate to it as use value." (Grundrisse p. 881)
>>Unfortunately, nothing so clear was written in either the Contribution or
>>Capital I.
>>At 03:18 AM 2/26/00 +0800, you wrote:
>>>Thanx Steve K, for your terrific exposition on labour power as a commodity
>>>(OPE-L; 2403). It is interesting that you make use of Marx's Notes on
>>>Adolph Wagner, where Marx makes (to my knowledge) his strongest case for a
>>>concept of 'social use value'.
>>>The argument goes like this: Commodites are products produced for the use
>>>of others (they are *social use values*). As a concept pertaining to the
>>>useful properties of *commodities* the concept of use-value must acquire in
>>>addition to its natural properties, a particular social form. Marx,
>>>stressed the point:
>>>"A thing can be useful and be the product of human labour, without being a
>>>commodity. Whoever satisfies his own need through his product, does create
>>>use-value, but not a commodity. In order to produce a commodity, he must
>>>not only produce *use-value, but use-value for others, social use-value*…So
>>>use-value itself - as the use-value of the 'commodity' - possesses an
>>>historically specific character' (Marx, 1979-80, p.199; **Marx's italics).
>>>I think that the argument for an historical 'social' concept of use-value,
>>>is important in the context of Marx's dispute with Ricardo on the price of
>>>labour. According to Marx, Ricardo cannot explain the divergence between
>>>the quantity and value of the labour embodied in commodities: 'Ricardo has
>>>in fact no answer… He determines value here, in one of the basic
>>>propositions of the whole system, by demand and supply - as Say notes with
>>>malicious pleasure' (Marx, TSV 2, p.400).
>>>Ricardo's failure to explain how surplus value can arise - given the
>>>proposition of equal exchange - Marx puts down to a failure to distinguish
>>>between two different *forms* taken by useful labour in capitalism. On the
>>>one hand, useful labour is a quantity of expended human energy, embodied in
>>>commodities and consumed ex post following exchange: it is *materialised
>>>labour*. On the other hand, labour-power exists in commodity-form as
>>>*living labour*, consumed ex ante in production. Opposition between the
>>>bodily expression of useful labour and its commodification in the form of
>>>labour-power explains why the 'law' of equal exchange does not apply:
>>>'surplus value itself is derived from a specific use-value of labour-power
>>>which belongs to it exclusively' (Marx, 1879-80, p.200).
>>>The concept of 'social use-value' looks to be a crucial element of a theory
>>>of capitalism as a system of commodity production based on wage labour. As
>>>Marx, himself, commented in his Notes on Adolph Wagner: 'only an
>>>obscurantist' could fail to recognise that the commodity is an
>>>'historically specific' form of use-value, 'the simplest social form in
>>>which the labour product is presented in contemporary society' (Notes on W,
>>>1879-80, p.198). As a commodity, labour-power is itself a 'social
>>>use-value' - a very important one since it creates value.
>>>Unfortunately, the social character of the commodity-form of use-value is
>>>less clear in *Capital*. Having described use-value as a natural quality
>>>of 'usefulness' constituting the 'content of wealth, whatever its social
>>>form may be', Marx turns immediately to the 'form of society' in which
>>>these natural use-values (products) assume a social relation as
>>>commodities: as exchange values (C1, 1976, p.126). Perhaps this lack of
>>>clarity explains why the idea of labour-power as a special commodity (as a
>>>social use-value) isn't well understood.
>>>At 07:53 24/02/00 +1100, you wrote:
>>>>marx had much the sort of hypothetical conversation you develop with
>>>>Ricardo--in which case Marx played the role of Samuelson. He didn't need
>>>>any help from OPE, as it happens! Instead, OPE needs to read him a bit
>>>>The position you ascribe to Marx, he actually ascribes to Ricardo (of the
>>>>single "c"!), and in one of my favourite lines, notes that "Ricardo has in
>>>>fact no answer, other than ... the law of supply and demand ... He
>>>>determines *value* here, in one of the basic propositions of the whole
>>>>system, by *demand and supply*---as Say notes with malicious pleasure."
>>>>Marx's "conversation" with Ricardo, from Theories of Surplus Value Vol.
>>>>is reproduced between the dashes:
>>>>15.2.1 Quantity of labour and value of labour. [As presented by Ricardo
>>>>the problem of the exchange of labour for capital cannot be solved]
>>>>"It is clear that the proportional quantity of labour contained in two
>>>>commodities A and B, is absolutely unaffected by whether the workers who
>>>>produce A and B receive much or little of the product of their labour. The
>>>>value of A and B is determined by the *quantity of labour* which their
>>>>production costs, and not by the *costs of labour* to the owners of A and
>>>>B. Quantity of labour and value of labour are two different
things."(TSV 2:
>>>>p. 395)
>>>>"Now wage-labour, however, is a *commodity*. It is even the basis on which
>>>>the production of *products* as
>>>>*commodities* takes place. The *law of values* is not applicable to it.
>>>>Capitalist production therefore is not governed at all by this law... The
>>>>second ... [problem] ... lies in the fact that the *utilisation* of a
>>>>commodity (as capital) is proportional not to the amount of labour it
>>>>contains, but to the extent to which it commands the *labour of others*,
>>>>gives power over *more* labour than it itself contains. This in fact is a
>>>>second latent reason for asserting that since the beginning of capitalist
>>>>production, the value of commodities is determined not by the labour they
>>>>contain but by the living labour which they command, in other words, by
>>>>*value of labour*."(TSV 2: p. 397)
>>>>"But how does the commodity labour differ from other commodities? One is
>>>>*living labour* and the other *materialised* labour. They are, therefore,
>>>>only two different forms of labour. Since the difference is only a matter
>>>>of form, why should a law apply to one and not to the other? Ricardo does
>>>>not answer---he does not even raise this question."(TSV 2: pp. 397-98)
>>>>"The question is just why *labour* and the *commodities against which
it is
>>>>exchanged*, do not exchange according to the law of value, i.e. according
>>>>to the relative quantities of labour. Posed in this way, *presupposing the
>>>>law of value*, the question is intrinsically insoluble, because
*labour* as
>>>>such is counterposed to *commodity*..."(TSV 2: p. 398)
>>>>15.2.2 @subsection = Value of labour power. Value of labour. [Ricardo's
>>>>confusion of labour with labour-power. Concept of the "natural price of
>>>>Summarising Ricardo, Marx says that in Ricardo's system "The *value of
>>>>labour* is therefore determined by the *means of subsistence* which, in a
>>>>given society, are traditionally *necessary* for the maintenance and
>>>>reproduction of the labourers.
>>>>But why? By what law is the *value of labour* determined in this way?
>>>>Ricardo has in fact no answer, other than ... the law of supply and demand
>>>>... He determines *value* here, in one of the basic propositions of the
>>>>whole system, by *demand and supply*---as Say notes with malicious
>>>>pleasure."(TSV 2: p. 400)
>>>>"As wages are equal to the necessary means of subsistence,... If the value
>>>>of the means of subsistence changes, then the value of the real wage
>>>>changes... And here we have the *hidden reason* for Adam Smith's
>>>>that as soon as capital, and consequently wage labour, intervenes, the
>>>>value of the product is not regulated by the quantity of labour bestowed
>>>>upon it, but by the quantity of labour it can command. The value of corn
>>>>determined by labour-time, changes; but, so long as the natural price of
>>>>labour is paid, the quantity of
>>>>labour that the quarter of corn can command remains the same. "(TSV 2: p.
>>>>15.2.3 @subsection = Surplus-value. [An analysis of the source of surplus
>>>>value is lacking in Ricardo's work. His concept of the working day as a
>>>>fixed magnitude.]
>>>>"Apart from the confusion between labour and labour-power, Ricardo defines
>>>>the average wages or the value of labour correctly. For he says that it is
>>>>determined ... by the *labour-time which it costs to produce it*; that is,
>>>>by the *quantity of labour materialised* in the means of subsistence of
>>>>labourer."(TSV 2: p. 404)
>>>>However Marx argues that he failed to show that only part of the worker's
>>>>working day is used to reproduce this value, while another part becomes
>>>>"Ricardo starts out from the actual fact of capitalist production. The
>>>>value of labour is smaller than the value of the product which it
>>>>creates.... The excess of the value of the product *over* the value of the
>>>>wages is the surplus-value.... For him, it is a fact, that the value of
>>>>product is greater than the value of the wages. How this fact arises,
>>>>remains unclear. The total working-day *is greater* than that part of the
>>>>working day which is required for the production of wages. Why? That does
>>>>not emerge."(TSV 2: pp. 405-06)
>>>>Typically, Marx does not provide his own answer clearly at this point
>>>>Marx really lacked was a good editor!). Instead, you can find a reasonable
>>>>didactic statement of it in his critique of Wagner (between the dashes
>>>>"Secondly, only an obscurantist, who has not understood a word of
>>>>*Capital*, can conclude: Because Marx, in a note to the first edition of
>>>>*Capital*, overthrows all the German professorial twaddle on
`use-value' in
>>>>general, and refers readers who want to know something about actual
>>>>use-value to `commercial guides',---therefore, *use-value* does not play
>>>>any role in his work...."(Wagner: p. 198-99.)
>>>>"Whoever satisfies his own need through his product, does create a use
>>>>value, but not a commodity. In order to produce a commodity, *he must not
>>>>only produce a use value,* but *use-value for others, social use
value*. So
>>>>use value itself---as the use value of the `commodity'---possesses an
>>>>historically specific character."(Wagner: p. 199.)
>>>>"On the other hand, the obscurantist has overlooked that my analysis of
>>>>commodity does not stop at the dual mode in which the commodity is
>>>>presented, [but] presses forward [so] that in the dual nature of the
>>>>commodity there is presented the twofold *character* of *labour*, whose
>>>>product it is: *useful* labour, i.e., the concrete modes of labour, which
>>>>create use values, and abstract *labour, labour as the
>>>>expenditure of labour-power*,... that *surplus value* itself is derived
>>>>from a `specific' *use-value of
>>>>labour-power* which belongs to it exclusively etc etc., that hence with me
>>>>use value plays an important role completely different than [it did]] in
>>>>previous [political] economy, but that, *nota bene*, it only comes into
>>>>picture where such consideration [of value, use value, etc.] springs from
>>>>the analysis of given economic forms, not from helter-skelter quibbling
>>>>over the concepts or words `use-value' and `value'."(Wagner: p. 200.)
>>>>Marx's "way out", in other words, is not that labor is not a commodity,
>>>>an analysis of the commodity itself which differs from any preceding
>>>>commodity, and in which the concept of use-value is crucial. The best
>>>>statement of that is in Capital I:
>>>>The past labour that is embodied in the labour-power, and the living
>>>>that it can call into action; the daily cost of maintaining it, and its
>>>>daily expenditure in work, are two totally different things. The former
>>>>determines the exchange value of the labour-power, the latter is its use
>>>>value. The fact that half a [working] day's labour is necessary to keep
>>>>labourer alive during 24 hours, does not in any way prevent him from
>>>>working a whole day. Therefore, the value of labour-power, and the value
>>>>which that labour-power creates in the labour process, are two entirely
>>>>different magnitudes; and this difference of the two values was what the
>>>>capitalist had in view, when he was purchasing the labour-power... What
>>>>really influenced him was the specific use-value which this commodity
>>>>possesses of being a source not only of value, but of more value than it
>>>>has itself. This is the special service that the capitalist expects from
>>>>labour-power, and in this transaction he acts in accordance with the
>>>>'eternal laws' of the exchange of commodities. The seller of labour-power,
>>>>like the seller of any other commodity, realises its exchange-value, and
>>>>parts with its use-value. (Capital I: p. 188)
>>>>Finally, Marx's reason is somewhat clearer: his analysis of why
>>>>surplus-value arises from labor/labor-power is derived from a
>>>>analysis of the commodity, in which the concepts of use-value and
>>>>exchange-value are essential. The basic notion is that a consumer of *any*
>>>>commodity in capitalism pays a commodity's exchange-value in order to
>>>>commandeer its use-value. As to why this distinction exists, we have to
>>>>turn to earlier in Vol I:
>>>>"The exchange of commodities, therefore, first begins on the boundaries of
>>>>such communities, at their points of contact with other similar
>>>>communities, or with members of the latter. So soon, however, as products
>>>>once become commodities in the external relations of a community, they
>>>>also, by reaction, become so in its internal intercourse. The proportions
>>>>in which they are exchangeable are at first quite a matter of chance. What
>>>>makes them exchangeable is the mutual desire of their owners to alienate
>>>>them. Meantime the need for foreign objects of utility gradually
>>>>establishes itself. The constant repetition of exchange makes it a normal
>>>>social act. In the course of time, therefore, some portion at least of the
>>>>products of labour must be produced with a special view to exchange. From
>>>>that moment the distinction becomes firmly established between the utility
>>>>of an object for the purposes of consumption, and its utility for the
>>>>purposes of exchange. Its use-value becomes distinguished from its
>>>>exchange-value. On the other hand, the quantitative proportion in which
>>>>articles are exchangeable, becomes dependent on their production itself."
>>>>(Capital I: p. 91)
>>>>Marx's analysis of the commodity therefore is his "way out", with his
>>>>argument being that the labor exchange is like that of any other
>>>>but that this commodity has the peculiar attribute that its use-value to
>>>>its capitalist consumer is not qualitative but quantitative. Since the
>>>>general rules of commodity exchange, according to marx, mean that
>>>>and exchange-value are incommensurable, this translates to a quantitative
>>>>difference between the two in the case of this exchange, and this is the
>>>>source of surplus value.
>>>>However, I argue that this "way out" generates another dilemma for Marx
>>>>which he can't solve: how to prove that labor/labor-power is the only
>>>>commodity to which this applies.
>>>>At 01:29 PM 2/23/00 -0500, you wrote:
>>>>>---------- Forwarded message ----------
>>>>>Date: Wed, 23 Feb 2000 19:17:07 +0100
>>>>>From: Ernesto Screpanti <screpanti@unisi.it>
>>>>>Dear comrades,
>>>>>It seems to me that the discussion on the employment contract is going in
>>>>>several directions that, although very interesting, are inducing us to
>>>>>focus on the real theoretical problem. Therefore I hope you will allow me
>>>>>to try to redress the discussion. And let me start with an attempt to
>>>>>bring to light two important theoretical difficulties of Marx's
theories of
>>>>>exploitation and class. These are the problems that prompted my research
>>>>>agenda on the employment contract.
>>>>>1. The "labour-power value" paradox. Marx and Engels assume the so called
>>>>>"law of value" or "low of exchange", whereby any commodity is paid in the
>>>>>market its real value (to avoid entering the TLV question, let me assume
>>>>>that commoditities exchange at production prices). Competition brings
>>>>>this result. Marx and Engels make this assumption to make sure that the
>>>>>analysis of exploitation is focused on production conditions and not on
>>>>>unequal exchange in the market. In analytical terms the law of value
can be
>>>>>reformualte as follows: The price of any commodity coincides with its
>>>>>production costs and with the present value of its future streams of
>>>>>The question is: Where does a positive profit come out if labour
power too
>>>>>is a commodity? If competition compels it to receive a price coinciding
>>>>>with the present value of its future streems of services, there can be no
>>>>>exploitation. Marx would answer - If the capitalists earn no profit they
>>>>>reduce investments, the industrial reserve army rises, etc. etc.
>>>>>the capitalist must earn at least a "normal" profit.
>>>>>Samuleson would answer: Oh, yes! This precisely what I say. In fact the
>>>>>normal profit in competitive equilibrium is nil.
>>>>>Marx - But the value of labour power is a subsistence wage.
>>>>>Samuelson - But certainly not a purely physical subsistence.
>>>>>Marx - Certainly not. There are habits and customs and trade unions and
>>>>>Samuelson - No. You assumed comnpetition. Therefore no bargaining.
>>>>>Marx: OK. So what?
>>>>>Samuelson - The long run equilibrium prices are fixed by the forces of
>>>>>competition at the level that makes them coincide with the cost of
>>>>>production. The value of labour power must be established accordingly, if
>>>>>labour power is a commodity. And also the production conditions of labour
>>>>>power must be determined accordingly
>>>>>Enters Veblen - Pricesely what I say: Habits and customs are
endogenous in
>>>>>the long run.
>>>>>Marx - Yes, but I insist: so what?
>>>>>Samuelson - If there is a positive profit, investements increase, the
>>>>>industrial reserve army shrinks and wages (and habits and customs, in the
>>>>>long run, and therefore the real production cost of labour power) rise to
>>>>>their equilibrium value. When they reach this value profits must be nil.
>>>>>Marx - But the subsistence wage changes slowly, certainly much slower
>>>>>the the market prices of the other commodities.
>>>>>Samuelson - This means that the law of value, that you assumed to avoid
>>>>>explaining exploitation as a production phenomen and not as a market
>>>>>phenomen, does not apply to labour power. You can account for
>>>>>only if the law of value does not apply to labour power.
>>>>>Marx - what does that mean?
>>>>>Samuelson - It means that you are explaing exploitation as a market
>>>>>phenomenon: there is exploitation because there is no perfect competition
>>>>>in the labour market!
>>>>>Marx - OPEL comrades, help!
>>>>>Screpanti - there is only one way out: Labour power is not a
commodity. The
>>>>>wage is not a price of a commodity. The labour market does not exist.
>>>>>Unions and labour movements do exists. Exploitation is the consequence of
>>>>>the exercise of power in the labour process. It occurs because the wage
>>>>>rate is fixed through bargaining ex ante (before the beginning of the
>>>>>production process), while labour productivity is determined by the
>>>>>capitalists' power ex post (i.e. in the labour process).
>>>>>2) The paradox of "class demarcation". Now I have no time to present you
>>>>>this second problem. Let me reserve it for another message.
>>>>>Ernesto Screpanti
>>>>>Dipartimento di Economia Politica
>>>>>Piazza S. Francesco 1
>>>>>53100 Siena
>>>>>tel: 0577 232784
>>>>>fax: 0577 232661
>>>>Dr. Steve Keen
>>>>Senior Lecturer
>>>>Economics & Finance
>>>>University of Western Sydney Macarthur
>>>>Building 11 Room 30,
>>>>Goldsmith Avenue, Campbelltown
>>>>PO Box 555 Campbelltown NSW 2560
>>>>s.keen@uws.edu.au 61 2 4620-3016 Fax 61 2 4626-6683
>>>>Home 02 9558-8018 Mobile 0409 716 088
>>>>Home Page: http://bus.macarthur.uws.edu.au/steve-keen/
>>>>Workshop on Economic Dynamcs: http://bus.macarthur.uws.edu.au/WED
>>Dr. Steve Keen
>>Senior Lecturer
>>Economics & Finance
>>University of Western Sydney Macarthur
>>Building 11 Room 30,
>>Goldsmith Avenue, Campbelltown
>>PO Box 555 Campbelltown NSW 2560
>>s.keen@uws.edu.au 61 2 4620-3016 Fax 61 2 4626-6683
>>Home 02 9558-8018 Mobile 0409 716 088
>>Home Page: http://bus.macarthur.uws.edu.au/steve-keen/
>>Workshop on Economic Dynamcs: http://bus.macarthur.uws.edu.au/WED
> Riccardo Bellofiore
>Office: Department of Economics
> Piazza Rosate, 2
> I-24129 Bergamo, Italy
>Home: Via Massena, 51
> I-10128 Torino, Italy
>e-mail bellofio@cisi.unito.it, bellofio@unibg.it
>tel: +39 035 277545 (direct)
> +39 035 277501 (dept. secr.)
> +39 011 5819619 (home)
>fax: +39 035 249975
Dr. Steve Keen
Senior Lecturer
Economics & Finance
University of Western Sydney Macarthur
Building 11 Room 30,
Goldsmith Avenue, Campbelltown
PO Box 555 Campbelltown NSW 2560
s.keen@uws.edu.au 61 2 4620-3016 Fax 61 2 4626-6683
Home 02 9558-8018 Mobile 0409 716 088
Home Page: http://bus.macarthur.uws.edu.au/steve-keen/
Workshop on Economic Dynamcs: http://bus.macarthur.uws.edu.au/WED

This archive was generated by hypermail 2b29 : Fri Apr 21 2000 - 09:47:47 EDT