Re: [OPE-L] SV: [OPE-L] what is irrational in the functioning of capitalism?

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Fri Dec 01 2006 - 22:46:17 EST

>Quoting Rakesh Bhandari <bhandari@BERKELEY.EDU>:
>>  So contrary to the LTV, there can be a positive rate of profit and
>>  relative prices in a totally automated economy.
>Are these real prices or Kantorovich's shadow prices?

Is the difference here between spontaneous and administered prices?

My criticism of the Dmitriev/Pack/Sinha scenario is a bit different
than Ian's. I don't the the fully automated economy is a horse which
can speak but a different species than a capitalist economy. For Marx
the law of value has a historical and relative validity: the law of
value holds when the quantitative and qualitative allocation of
social labor time must be solved through reactions to the divergence
of prices from the values of the commodities by which social
producers are alone related.

Prices and profits are not always regulated by the law of value;
there is not in all social formations objectivity in the illusion
that a powerful, quasi magnetic property of commodities is their
value to which their respective prices are drawn even against
political or external interference (for example price controls). The
value of the products of social labor as a real causal power is a
socially objective illusion in a general commodity society. Things in
the saddle/And ride mankind--this is exact economic theory! Socially
objective illusion is of course a difficult and revolutionary idea as
Gideon Freudenthal has shown (Science in Context 10, 1).

As he has also argued, the meaning of critique in Marx's magnum opus
is analogous to Kant's in Critique of Pure Reason: it meant to
restrict the range of justified application of the categories of
political economy.
So too with the law of value. That prices and profits can or would be
determined independently of it in social formations other than
bourgeois society is in no way a disproof of its historical and
relative validity.

For this reason I think that the exercise of determining prices and
profits in a totally automated economy has nothing to tell us about
the validity of the law of value in the conditions specified by Marx.


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