[OPE-L:6300] Re: Re: grossman (response to paul z) [or, the "silences" of Grossman and Lenin]

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Sun Jan 13 2002 - 01:17:49 EST

Dear Paul,
I just don't know what to say. No one accuses Mattick Sr of fealty to 
Lenin, yet in the former's Economic Crisis and Crisis theory the 
council communist has almost nothing to say about Lenin's theory of 
value, accumulation and crisis. A couple of lines; his attention is 
consumed by Tugan, Hilferding, Bauer, Luxemburg   And this is how it 
has to be because Lenin did not contribute much to the debate about 
breakdown (or the impossibility thereof)  And Grossman did criticize 
in detail those Bolsheviks who had abused Luxemburg. His treatment of 
Bukharin is brutal.

>Seems to be Mattick's charge against Luxemburg ("her own solution of the
>problem comprises, in essence, no more than a misunderstanding of the
>relation between money and capital and a misreading of the Marxian text"),
>which in turn is based on Bukharin's distortion that for Luxemburg
>accumulation of capital is accumulation of money capital.  I reply in my
>published article.

I do think it's important that we revisit these critiques by Bauer 
and Bukharin, and I think you are right that we should not accept 
that their criticisms of Luxemburg were decisive--as Howard and King 
tell us those criticisms were. I thank you for reopening debates that 
were thoguht to be long ago settled.

  Mattick is not only making the same point as Bukharin, viz. that all 
of the surplus value which may be embodied in commodities or the 
means of production does not have to be immediately realized as money 

In fact this is not Mattick's emphasis at all. Like Duncan Foley, 
Mattick argues that the mechanisms of credit can allow for the 
realization of that surplus value which is to be accumulated and 

Mattick writes:

"The transformation of surplus value into additional capital can be 
accomplished without additional commodity money, and capital can be 
accumulated in commodity form. No actual commodity money corresponds 
to the credit money necessary for this; it is the 'symbolic form' of 
an additional sum of money that does not exist in reality; but it 
suffices to carry out the tranformation of the commodity values into 
additional capital: additional capital that in turn determines the 
future expansion of credit. Thus it is the accumulation of capital 
itself which solves theproblem of the addiotnal money necessary and 
eliminates the difficulties of realization by means of the techniques 
of finance...

"It is of no consequence at all whether this transformation [of 
surplus value into money] is accomplished with commodity money or 
symbolic money. The latter however can be increased at will and so 
adapted to the needs of accumulation. Its growth accompanies that of 
the accumulating capital but is also limited by the latter. In this 
way re return to the point that which appeared to unlikely to RL, 
namely the production for the sake of production which she believed 
impossible in a closed system, having failed to find an explanation 
for the additional money required.

"If capital can realize its surplus value through accumulation, then 
the enlarged cpaitals are represented as increased sums of money 
capital. But accumulation depends not on money or credit but on 
profitability. If profit falls, and with them the rate of 
accumulation, the the demand for credit declines along with the total 
demand. The insufficient demand appears as a lack of money and the 
crisis of production also as a financial crisis." Economic Crisis and 
Crisis Theory, p. 114.

In Mattick's reading, Marx introduces the gold sector of the perfect 
size as a deus ex machina so he does not have to get into the 
intricacies of the credit creation process.

Another mistake that Luxemburg made was that she forgot that 
imbalances could possibly be overcome if exchange was at prices of 
production rather than at value as stipulated in the schemes.

Mattick Sr's critique is thus quite different in emphasis than Bukharin's.

>Isn't this a charge that Luxemburg is no Marxist?

She is a Marxist in political theory and practice, and a splendid 
Marxist at that whose example will always rise from the ashes as the 
proletariat reasserts its revolutionary aspiration.

  Her readings of Capital may well be generally illuminating. It's 
been a long time since I read those lectures, but they were eclipsed 
in my mind once I discovered Blake's textbook.

But her theory of accumulation, crisis and catastrophe abstracts the 
relations of exchange and the problem of realization from the 
concrete capitalist totality, and such abstraction puts her closer to 
bourgeois economics than Marx's critique of political economy. This 
however is not why the Austro Marxists or the Bolsheviks calumnied 
her; it is however why Grossmann and Mattick critiqued here.

>Maybe this is the intention in formulating criticism of her in such
>stark terms ('don't rely on her economics, ergo, don't rely on her

But I am not saying that. I am explicitly not saying that.

>Still, my topic in [OPE-L:6284] was not Luxemburg, but rather 1941 Grossman
>on Marx and the Classicals, and absent any discussion of Lenin's contrary

I think you are making too much of Grossmann's refusal to name Lenin 
in a footnote!

>P.S. Rakesh, did you ever get Bernice Shoul's 1947 Radcliffe dissertation
>and, if so, what's her "shocking" contribution? (Grossman "proceeded on the
>basis of a provisional acceptance of Say's Law for the purposes of
>discovering contradictions independent of demand. this aspect of grossman
>was best understood by bernice shoul who anticipates in shocking detail
>much of what raya dunayevskaya would later say on the matter as well")

yes I did read her dissertation, I thank Jerry for alerting me to it. 
What is surprising is what Shoul says in criticism of Luxemburg is 
quite like what Dunayevskaya says much later in her book on 
Luxemburg. Shoul was a very careful student of Grossman's.

All the best, Rakesh

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