[OPE-L:7619] Re: money and historical contingency

From: Rakesh Bhandari (rakeshb@stanford.edu)
Date: Fri Sep 06 2002 - 11:44:11 EDT

Hi Jerry. You write in 7615

>Isn't  whether money took the form of a money commodity  under
>capitalism a matter of historical contingency?

Perhaps. So the better question here is not whether money must be a 
commodity but whether once there is  commodity money will anything 
other than an inherently scarce, relatively indestructible precious 
metal likely serve as a commodity money. The claim that is being 
advanced here is that not all commodities are subject to the laws of 
competitive price formation. Ricardo excluded those commodities which 
are not freely reproducible. Gold is not freely reproducible. Michele 
has aruged that commodities in which scarce land serves as a means of 
production are in particular not subject to the laws of price of 
production  on account of the role absolute rent plays in Marx's 
system.  I have argued that the long term needed to equilibriate the 
exchange value with the price of production of commodities whose 
supply dwarfs current output is much too long term to say that the 
tendency towards the price of production is really effective.

>   After all, the state could
>have offered paper currency printed in its name as money and banned
>the use of any other materials (gold and silver included) as money.

Yes then we would seem to be dealing with fiat money. And then 
Bortkiewicz's and Sweezy's argument for the use of gold as the unit 
of account cannot hold.

>That paper currency  issued by the state was first introduced under
>a monetary system where there was a money commodity and was
>"backed-up" by the stock of gold and silver held by the state seems
>also to be a matter of historical contingency.  This topic -- the state's
>in a capitalist monetary system -- wasn't fully developed in Volume One
>-- or the rest of _Capital_ -- since the state-form was being abstracted
>from at that level of exposition.

This of course is a very important point.

All the best, Rakesh

>In solidarity, Jerry

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