Re: [OPE-L] Capital in General

From: Fred Moseley (fmoseley@MTHOLYOKE.EDU)
Date: Sun Oct 23 2005 - 09:29:51 EDT

On Wed, 19 Oct 2005 glevy@PRATT.EDU wrote:

> > I do not mean to minimize the importance of capitalism's tendency toward
> > crises.  I have devoted a lot of years to Marx's crisis theory, especially
> > the falling rate of profit as applied to the US economy.  However, I have
> > come to realize that the three volumes of Capital are generally at a
> > higher level of abstraction than crises.  "Crises and the world market"
> > was the 6th book in Marx's original 6-book plan.  Capital was only the
> > first book.  Capital provides the basis for a more concrete theory of
> > crises, but such a theory is not presented in the three volumes.  Before
> > concrete crises can be analyzed, the production and distribution of
> > surplus-value must be explained.  These fundamental questions are
> > explained in Capital on the basis of the assumption that capitalism is
> > "functioning normally", i.e. that S = D and price = value or = price of
> > production.
> Fred:
> I agree with you on this point,

Jerry. I am very glad that we agree on this important point.

> but I wonder:  after you came to this
> realization, how did that impact and/or modify your understanding of the
> more concrete mechanics of crisis?  I'm genuinely curious about that.
> In solidarity, Jerry

Nothing has changed fundamentally.  I still think that Marx's
theory of the falling rate of profit provides the basis for the theory of
crises in capitalism.  But it is an abstract basis, and more factors need
to be considered at more concrete  levels of abstraction in order to
analyze real capitalist crises.

In the first place, the possible effects of government intervention of the
rate of profit must be analyzed, as Mattick did.  (Marx planned to include
"the state" in book 4 of his original 6-book plan) .  A second factor:
the distinction between productive labor and unproductive labor should be
incorporated.  Marx's theory of the falling rate of profit applies only to
productive capital.  I (and Shaikh and others) have extended Marx's
abstract theory of the falling rate of profit to this more concrete level
and analyze the "conventional rate of profit" for the total capital,
including unproductive capital.

Beyond that, debt-credit relations are obviously very important for
crises, and much more work needs to be done along these lines.

Plus, I would also add international economic relations, including
exchange rates (which Marx also planned to analyze in book 5).

I just realize more clearly that the 3 volumes of Capital are at a very
high level of abstraction.  Capital is a book of "basic theory" or
"principles".  Much work needs to be done - by us - to develop Marx's
theory toward more concrete applications.


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