[OPE-L:5698] Re: Re: de-bunking the de-bunk

From: Steve Keen (s.keen@uws.edu.au)
Date: Thu May 31 2001 - 08:51:47 EDT

Yes Gerry,

But you forget that my critique of LTV marxism begins from a completely 
different foundation to Sraffians et al. I don't start by saying "the LTV 
leads to logical conundrums"; I start by saying "the LTV is inconsistent 
with Marx's dialectical theory of value". So with that start, any theory 
which attempts to prove that the LTV is viable in any form doesn't even get 
to first base with me. It may be a LTV theory; but to me, it ain't Marx.

Similarly on TSS; I could, if I had the time--which I don't--put TSS into a 
general and generic dynamic form, and show that it is internally 
inconsistent (I suspect that it too would only work with constant L/K 
ratios in all industries). If I didn't believe that the LTV was itself 
badly formed, I would feel obliged to do that (if I thought that the time 
it would take was warranted).

 From my point of view, these arguments feel a bit like fighting the Black 
Knight in "Monty Python and the Holy Grail". From my point of view--and 
from the point of view of the historians of economic thought who refereed 
my papers on this issue--I've already cut off both legs (the belief that 
the LTV is Marx's fundamental theory of value, and the belief that the LTV 
is consistent with his theory of value). Now VFT and TSS interpretations 
are threatening to bite me to death. Sorry, but I'd prefer to engage with 
other heterodox economists who don't share these hangups.

Which is not to say that other heterodoxers don't have hangups, as you go 
on to argue. Yes, Keynes still accepted the marginal productivity theory of 
income distribution (a greater crime, in my opinion, than still falling for 
utility maximisation, given his macroeconomic focus). But that I see as a 
skin which he was discarding; what I focus on in Keynes are the very rich 
appreciations of uncertainty and the role of finance, which are largely 
expressed in Chapter 12 of the GT and his 1937 papers.

True, Kalecki is a better father of what is called Post Keynesianism than 
Keynes. But even Kalecki would accept that Keynes was the better writer, 
and more strongly focused on the fundamental importance of uncertainty in 
analysing capitalist investment. I'm also quite willing to regard some of 
the analyses you cite as belonging to my chapter 14--so long as they don't 
base themselves on the LTV, which many of them don't. It's the LTV (in 
whatever form) that I object to, not Marx.

However, both Keynes and Kalecki (moreso the former) didn't appreciate the 
importance of dynamic analysis over static--and many of their followers 
still make the same mistake (a failing which I point out in chapter 14).

There are some arguments I would reject in your statements 
below--Post-Keynesians aren't marginalists (but most are static theorists, 
which is almost as bad). As for myself, I can cope with being typecast as a 
Post Keynesian, but if I have the chance to apply my own economist label, 
then it is a Marxian evolutionary economist.

At 10:25 PM 5/31/01 Thursday, you wrote:
>Re Steve K's [5676]:
> > No, I won't move VFT from chapter 13 to
> > chapter 14. I see most of these
> > elements of VFT as sidesteps of the essential
> > problems in LTV marxism, just
> > as I see the Sonnenshein-Mantel-Debreu
> > conditions as sidesteps of the
> > essential problems in the neoclassical theory of
> > consumption.
>Interesting. Yet, as the 'De-Bunker Supreme',
>don't you recognize that one of the first principles
>of de-bunking is that one must be thoroughly
>familiar with the content of what one claims to
>be de-bunking?
>Furthermore, isn't your judgment that there was
>a  (illegitimate?) 'sidestep'  an unfounded assertion
>and presumption?  Do legitimate 'de-bunkers'
>  render a verdict of 'guilty' based on 'guilt by
>association'  (i.e. VFT is Marxian and adopts a
>theory of value based on, but not identical to,
>Marx's theory and therefore, according to Steve,
>it *must be* bunk?)?
>Is this similar to your view that the TSSI _can't_
>be truly dynamic even though you have admitted
>that you have not demonstrated that claim?  Isn't
>the idea that one first comes to a judgment and
>_then_ one reads the relevant material and actually
>attempts to demonstrate what one has claimed
>... illegitimate bunk?
>And, while I'm talking about bunk, let's talk
>about J.M. Keynes.  Wasn't his claim about
>why he didn't incorporate long-run analysis into
>his theory just bunk? Isn't it illegitimate for a
>macroeconomic theory to limit itself to short-run
>analysis?  Wasn't Keynes a marginalist? I.e. didn't
>he accept the marginal utility theory of value? Isn't
>that bunk?   And isn't it bunk supreme to think
>that marginalist theory, in the form of Keynesian
>theory, can be successfully wedded to (modern
>day) Ricardian theory, in the form of Sraffian
>theory? If one embraces one, doesn't one have to
>reject the other ... unless one is a bunkster?
>His politics, especially his role in the General
>Strike of 1926, could be deemed to be bunk as
>So why not reject Keynes as a bunkster and
>abandon the title of 'Post-Keynesian' in favor of
>the title 'Post-Kaleckian'?   After all, whatever can
>be said against Kalecki's perspectives, at least
>he didn't adhere to the above-mentioned bunk
>of Keynes.
>Shouldn't  you then add those Marxian
>perspectives influenced by Kalecki (who
>considered himself to be a Marxian, right?)
>to the last chapter of your book?  Here I have
>in mind several different perspectives beginning
>with Steindl and Baran-Sweezy and going to
>Foster (e.g. see _The Theory of Monopoly
>Capitalism_, MR, 1986) [an analysis in the
>tradition of Baran-Sweezy], Cowling (e.g.
>see _Monopoly Capitalism_, John Wiley and
>Sons, 1982) [an update to Kaleckian theory?],
>and Levine (e.g. see _Economic Theory_, 2
>volumes, Routledge and Kegan Paul, 1978)
>[a unique perspective, but influenced in part by
>Kalecki, Steindl, and Baran/Sweezy]?
>Or (a question for others): is Kaleckian theory,
>in any sense of the term, bunk? What about the
>others mentioned in the previous paragraph?
>Would Occam's Razor suggest that perspectives
>advanced by Baran/Sweezy and Foster have an
>advantage over Marxian perspectives which are
>based on Marx's theory of value?  After all, it is
>a simpler theory, right?  Or are these theories
>_too_ simple? Is so, how?
>In solidarity, Jerry

Home Page: http://www.debunking-economics.com
Dr. Steve Keen
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Economics & Finance
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