[OPE-L] the point of a dynamic model?

From: Jurriaan Bendien (adsl675281@TISCALI.NL)
Date: Fri Mar 16 2007 - 23:08:10 EDT

Hi Jerry,

Well that is probably true (though Freeman/Kliman were influenced at least
to some extent by Althusser) but I meant really the idea of "ideological
class warfare" or more simply "the battle of ideas".


The assumption being made in TSSI is that the lynchpin of bourgeois
economics is the idea of self-equilibrating markets, and that this idea
makes any sensible understanding of capitalist economies impossible.

Ergo, if you attack and remove the idea of self-equilibrating markets, then
a more sensible understanding becomes possible. But the problem is that the
notion of self-equilibrating markets is deeply ingrained, it is a dogma
upheld even when it flies in the face of the facts, or is shown to be
theoretically incoherent.

Supply and demand do adjust, sure, but equilibrium is at best only an ideal
tendency that is never realised and this becomes highly important for

If five people have $40 each to buy five white shirts on offer for $40 each,
and five people never have the money to buy five more white shirts they need
that could be produced, you can say there is equilibrium at $40 a shirt
because the market was cleared, but meantime five people remain with no
white shirt at all, although they need one. What is "demand" in that case?
$200? $400? Five people wanting shirts? Or ten people wanting shirts? I
could introduce all sorts of more variables to make a more complex story,
but I'll just leave it at this thought.

So what do you do then? Well what you do is counterpose to it another
economics with a different label, "non-equilibrium economics" and you have
to ram that home to people or at least impress them with it. You have to
tell them what they don't want to hear, and you might have to repeat
yourself. And that may seem tedious. I am very reluctant though to cast
aspersions on TSSI supporters like you do. I've met Alan Freeman, Mino
Carchedi and Paolo Giussani, and believe me they are or have been involved
in a lot more than a "small world of Marxian economists".

They would argue (1) that if only "a small proportion of economists and
graduate students know or care what the "transformation problem"  or the
"Okishio Theorem" is" - I don't think it's true - the reason is that these
items were previously taken as convincing proof that Marx's economics is a
dead duck, just as Howard & King present it (with some very sloppy argument
and discussion) in their massive overview of the Marxist discipline (in fact
in Wellington in 1994 I discussed with economists of the New Zealand
Institute of Economic Research who regarded Howard & King as the definitive
nail in the coffin of Marxian economics).

(2) If you want to revive Marxian economics, then you have to do it by
solving the core problems that caused it to be discredited in popular
opinion - the task of the intellectual is to solve the most difficult
abstract and theoretical problems which are at the foundations of the whole
theoretical edifice. You have to defeat the critics at their best, i.e. you
have to take the most substantive criticisms and show that they can be
rebutted successfully. As a sort of analogy, TSSI supporters suggest that
economists travelled along a road and they took a wrong turn at a certain
point, ending up in a place where they don't really know where they are
anymore, and then the task is to route them back to the point where they
took the wrong turn, and point them to the right direction. It's a traffic
control operation.

You are partly correct and partly wrong about the reasons why Marxism was
discredited. People accept and reject ideas for all sorts of reasons, good
ones and bad ones  or no reason at all. But an intellectual focuses on the
good reasons and the best reasons. Otherwise he would not be an
intellectual, but a word-mongerer or a propagandist. Anybody can write or
say something, but there has to be quality control. Without intellectuals,
there is no quality control. The intellectual seeks to grasp the internal
dialectics of ideas at the highest level of abstraction, i.e. the high road
of human thought, rather than the low road. Well, who says what are the best
reasons? That's an ongoing argument, and if you are not even making the
argument then you cannot change anything.


Marx is still important to us because the road to hell is paved with
capitalist good intentions. Capitalists can have very good intentions, at
least as long as you work for them and they don't work for you. Otherwise
they would not be capitalists. Well, they wil even work for you, of course,
but there's always that "pound of flesh" that must be submitted in the end.
That's business power, and if it isn't business, then it's just warm
fuzzies. You often cannot fault their intentions, but it is the aggregate
effects of what happens that are of concern. And those aggregate effects
might be the opposite of what is intended.

The task of a socialist is to look a bit beyond what people intend, to what
actually happens, what the overall result is. This is collective, social
thinking beyond individualist thinking. If people create hell on earth, that
is no reason to reconcile yourself with that hell. You can band together
with those who seek a way out of that hell, and fight the hell. The task of
the intellectual is to show that there are smart and dumb ways to fight, or,
that there are quick routes and long routes out of the hell. If they cannot
do that, there's no point in intellectuals, because they have no added value
in that case. Anybody can have an idea, what is needed is a strong idea of
good quality that modifies behaviour for the better.

Piero Sraffa is important to us because (1) he was a genuine socialist, (2)
he provided a much better understanding of the importance of David Ricardo's
economic writings (3) he shows that marginalist capital theory confronts
severe problems of internal incoherence (4) by implication, the problems of
Marxian economics are really no worse than those of neo-classical economics,
(5) he helped to rehabilitate surplus economics generally, which is an
important element for understanding economic growth and the exploitation of
that growth.

In one slim volume, (6) he struck a blow at economic orthodoxy that set a
lot of economists thinking for a very long time, and he did it by using
their own language.
Sraffa says, okay, so you don't like value theory. Well here is another way
of looking at it and you get fairly much the same result. Sraffa affirmed
that there was not just one critique of economics possible (Marx's), you
could have many different critiques, you could make your own critique, and
that was a tremendously liberating idea. You could write your own Das
Kapital in your own style, as it were.


I do need more time, I just haven't enough time to do all I want to do. It
is not my intention to "take a position" on TSSI, my intention is to learn
from it what can be learnt from it. You have to skip the Marxist rhetoric,
and concentrate on the content. I am somebody who thinks that theoretical
foundations are very important, and I believe that we live in an epoch in
which the old theoretical have crumbled or are crumbling, and we need some
new ones. And I do not get very far by dismissing the old foundations as
mere rubbish.


Genuine theoretical development occurs through a dialectic of tradition and
innovation. Why dialectical? Because they are a unity-in-contradiction, i.e.
opposite yet mutually dependent, and move in tandem in such a way that one
prevails over the other in the end. You cannot innovate unless you are
thoroughly familiar with what came before. Otherwise you just think you are
doing something new, whereas that idea had already been mooted or worked out
before. You think you are making history, but you are just replicating it.
That is not scholarship.

If you want to free yourself from a tradition, you have to understand what
it is. Otherwise you imagine you are freeing yourself from it, while you are
replicating it. We are all a lot more traditional than we might think.
Consciousness is rooted in memory. A tradition is usually a practice or way
of doing things which arose out of a long evolution, i.e. lots of people
faced the same problem and reached the conclusion that a particular practice
solved it, and therefore that practice became embedded and institutionalised
in human action, it becomes habit. It becomes akin to a "truth". Its
strength is in the fact that it works, and that the practical experience of
a lot of people is behind it. But a lot of people can also be wrong, plus of
course the world changes, people change. Tradition has to be critically
re-examined in that case.

What a radical then does, is to show there is a new way of looking at things
or doing things which responds much better to how things are now, even if
tradition rules it out as impossible or impracticable. Or he takes up a
tradition again, against the inane mob that says "change is good" or some
such banality. The radical is basically an innovator however, instead of a
traditionalist. He doesn't fetishize tradition, and he doesn't necessarily
"go with the flow". He is creative, rather than conformist.

If however a new way of looking at things or doing things is not to be just
a "flash in the pan", it has to derive from a very thorough understanding of
what came before. The challenge to tradition is then not based on where the
tradition is weak anyway, but precisely at its strongest points. And if the
radical challenge succeeds, then the tradition is well and truly stuffed,
and people will switch to the new way of doing things, for which the radical
was the harbinger. If we are to return to an old idea, it has to be very
clear about how this contrasts with the new, and why the old idea was
better. That takes historical thinking.

It is not that the radical just has the satisfaction that "he said or did it
first", that is a superficiality, but rather that he opened up a new
development and thus changed the world, some way. It happens all the time,
people develop new products, new services, new ideas, new practices, new
characteristics. Postmodernistically they also root around in the past and
dig up new discoveries of old things. Capitalists can be very radical also.
Sometimes it is all too radical, because it destroys a basic continuity
which all people need to function, or the new way that people adopt is worse
than the old way. This makes it necessary to distinguish between progressive
and reactionary radicalism.


The tragedy of the true radical can be that in laying new foundations, to
reach a new idea, he disregards his very own personal foundations. Thus he
suffers for his own idea. He ignores, rebels against, or resists tradition
to his own peril. Sometimes he is by nature congentially unable to follow
tradition, he is forced to innovate or improvise in his life, because he
cannot imitate, or he has no tradition or precedent or experience to fall
back on. He might be astonishingly intelligent in some ways, and
astonishingly dumb in other ways.

This makes the radical predicament altogether rather complex:

"I can will knowledge, but not wisdom; going to bed, but not sleeping;
eating, but not hunger; meekness, but not humility; scrupulosity, but not
virtue; self-assertion or bravado, but not courage; lust, but not love;
commiseration, but not sympathy; congratulations, but not admiration;
religiosity, but not faith; reading, but not understanding" - L. Farber, The
ways of the will. NY: Basic Books, 1966, p. 15.

We all need to be able to relativise things, but a volatile radicalism can
explode, leaving only fragments.


- PS an ironical popsong has these lyrics:

Call out the instigator
Because there's something in the air
Weve got to get together sooner or later
Because the revolution's here
And you know its right
And you know that it's right
We have got to get it together
We have got to get it together now

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