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

From: Jerry Levy (Gerald_A_Levy@MSN.COM)
Date: Sat Mar 17 2007 - 17:15:10 EDT

> 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.

Hi Jurriaan:

That's certainly not the lynchpin of Keynesian economics which rejects
Say's Law and hence  the self-adjustment mechanisms of the "classics".
Yet, it is true that Keynesianism isn't inherently a dynamic theory.

In any event, recall that TSS aims to be an interpretation of Marx.
It focuses thus, not on "understanding capitalist economies"  but on
interpreting Marx.

> Ergo, if you attack and remove the idea of self-equilibrating markets,
> then a more sensible understanding becomes possible.

A  "more sensible understanding"  _of Marx_, you mean?

> 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.

As Keynes showed long ago.

> 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.

Tedious, perhaps; pretentious (when it is presented in a certain way), yes.
[I think that was suggested also by Riccardo the other day.]

There are many advocates of non-equilibrium economics -- primarily working
*outside* of a Marxian paradigm.  I'm going to tell  you what you don't want
to hear, though.  I'm going to repeat it over and again -- TSS claims to be
an _interpretation of Marx_ not  an advance in dynamic theory.

More to the point -- *when and where have they presented a dynamic model
that makes a "sensible understanding of capitalist economies" possible? *
Kliman gets in a  huff if you even suggest that he has presented a
"model" -- he prefers the term "illustrations".   Hermeneutics is their
focus, not understanding actual capitalist economies.  [NB: there are some
exceptions:  e.g. some of the writings in recent years of  Carchedi and
Giussani.  When I speak about TSST I am most often referring to the
writings on theory of  Freeman and Kliman -- their most vocal

The TSST advocates (sometimes)  say very sensible things about temporalism
and non-equilibrium theory.  But, they are prisoners to their own effort to
interpret  Marx "correctly".

Let me ask you (or anyone else): *where* have they actually developed
dynamic theory?  I.e. where have they moved beyond truisms and assertions
and walked the walk in terms of presenting a *meaningful*  dynamic model
which allows for a better comprehension of capitalism?    Until they become
surgically separated from Marx at the hip, they will not be able to do this,

The reason for this is very simple.  While I think it's true that Marx could
be said to have a temporal and dynamic understanding of capitalism,  he did
not present what our generation would call  a dynamic model.  Can Marx's
thought be  made compatible with a formal dynamic model?  Perhaps, but that
-- if successful -- would be a *reconstruction* of Marx's thought.  And
that's not  something that the TSSTers are ready to concede.  [NB: In my
view "simultaneism"  is also *clearly* a *reconstruction* of  Marx's
thought.  But, in opposing the reconstruction of the "simultaneists" the TSS
school have invented their  _own_  theory.  If they were to admit that and
get off of their high "Copernican"  horse  "defending Marx" then dialogue
with them could progress.]

Although he seemed to have toyed with the idea,  my view is that Marx
understood that there are too many variables to allow for a formal,
mathematical  presentation of his entire social theory.  His theory, in
other  words, was an *open*  one rather than a closed, determanistic one.
His concern was not primarily quantitative or formal: he understood that
there are uncertainties related to  capitalism that arise (not because of a
lack of information or theoretical understanding  but)  because of the
inherent nature  of capitalist production.  Formal  deterministic models
(TSST or  otherwise) do not work well for presenting  his perspectives.
For Marx, the dynamic of capitalism was  logical  but multi-sided, messy
and unpredictable;  for TSST the logic of capitalism can be formally
presented.  On this point, I think that Marx was right.

> 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,

I do wish we would all "get real".

Not only don't most economists know what the TP or the Okishio Theorem
is, but they have very little comprehension of the history of economic
thought  in general.  Most economists can't even intelligently discuss the
history of mainstream economics or methodological principles associated with
marginalist theory.  The history of economics itself and methodology
(rather than merely Marxian thought ) is taken to be a  dead duck.
One thing they *can* understand, though, is *numbers*: hence a desire by
some Marxians to *translate*  Marx's propositions into the language of
economics (which includes both linear and non-linear formalizations).  A lot
is lost in the translation, imo.   In this sense, I think that from a
history of  thought perspective the TSST is simply a special case of
quantitative  Marxism which historically evolved out of  "algebraic

While they like to talk about the need for dynamic theory, they present us
with simple corn models or models which assume v = 0 or other singularly
uninteresting and unrealistic "illustrations" of what is taken to be Marx's

Like many other Marxians, I originally looked hopefully and sympathetically
at what they identified as their project -- especially the need for
non-linear  and temporalist theory.  Indeed, I knew, respected, and
considered myself  the friend and comrade  of  some TSSers for decades
before this list was formed.  I *wanted* them to succeed -- especially since
I  never  identified  with dualism, linear theory, or simultaneism.  I
listened, I asked questions, and  waited.  And  waited.  And waited.
And waited. Finally  I  stopped waiting because I saw -- at least in
the form of Freeman,  Kliman,  and McGlone -- that they haven't
delivered what has been promised.  They blow a lot of whistles and they
show a lot of smoke -- and they especially like applying heat to others --
but (beyond a few generalities) where is the light?  At some point they
made a decision, it seems to me,  to stick to simply interpreting Marx.
When they did that, they closed off the most interesting and  promising
possible avenues for developing Marxian theory, imo.  I take no joy in
writing this.  I would have much preferred a different outcome.

> (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 -

"Popular opinion"?   That is the kind of out-of-touch statement that I've
been critical of.  The "popular opinion"  about Marx and Marxism hasn't been
shaped to *any* significant degree by the debates among economists about
Marx's theory.  The public doesn't have an obsession (of knowledge about)
the "transformation problem" ;  most non-Marxian  *economists* don't have
the  faintest clue what it means! -- it is a *Marxian* obsession.  If it
wasn't  for *Marxians* how often do you think the  TP would be

> 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.

You have to confront *both* the best and the worst arguments  (and
everything in the middle)  advanced by others.   Certainly, Marx didn't
focus only on the "best" arguments made by political economists;  genuine
and thorough critique requires the critique of *all*.

> 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.

A traffic control operation?  If we are to take that analogy literally that
would  make the TSST leaders the Traffic Police!

In any event, there isn't one fork in the road, there are many.  E.g. in
their quantitative determinism and their research focus on hermeneutics
(expressed infamously in the "1st thesis on Marxian Economics") I think
they took  a wrong turn long before they ever got to the issues that they
see as important.

> 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.

I don't agree.  An intellectual looks at  *all* of the reasons -- the good,
the bad, and the ugly.

Some brief points on the rest of what you wrote:

> 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.

I guess that depends on what you mean by "good intentions": they seek to
maximize their individual rate of profits.  I wouldn't call that "good
intentions"  or "bad intentions"; it is simply behavior in accord with
their essential character as capitalists.

>  You often cannot fault their intentions, but it is the aggregate
> effects of what happens that are of concern.

"Micro"  effects are important as well as aggregate effects.  (btw,
there is a moral question there.)

> 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.

The rhetoric is part of the content.  The rhetoric affects the content.  To
understand their theory, you have to comprehend both.

In solidarity, Jerry

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