[OPE-L] On Kliman and double divergence

From: Rakesh Bhandari (bhandari@BERKELEY.EDU)
Date: Sun Jul 08 2007 - 01:51:17 EDT

Fine I will desist, and since Jurriaan will be with you, I will stay
off the list until he takes or is asked to take a break from it. I am
not a shopkeeper Marxists and I encourage plunges into statistical
data with the critical mind recommended by Desroisieres which I hope
people appreciate my forwarding to the list as it is the most
sophisticated analysis out of the Bourdieu school.

  I'm obliged to send this correction about Andrew's book to this list
and the public archive because I did indeed miss the paragraph where
he discusses double divergence on p. 109 (it's a very short paragraph
at the very end of an chapter) and  I  wish to rectify the error.

I don't wish to impose this long post on anyone, but since my posts
are challenged in Kliman sympathetic circles, I address it to them
via the archive.

To begin with the most obvious point: I see no reason to make the
value of a commodity the sum of two different kinds of things--direct
labor time and the value of money required to buy mop at current
prices rather than indirect labor time itself. Why do we skip from
labor time to the value of money? It's antithetical to Marx to take
the entrepreneur's point of view of the value of the means of
production. Which is what Kliman does by taking the value of his
money outlay for means of production.  The question is however a
social one--how much of its socially necessary labor time does the
production of a commodity represent to society, not the entrepreneur.
The answer to that question can only be the sum of direct and
indirect labor time. Which does not mean I mean am a dual systems
theorist. I have long accepted DeVroey's interesting attempt to
create a single system interpretation.

And now for the empirical relevance:

It seems to that with global value chains US purchasers are close to
monopoly buyers as a result of their control of design and
distribution. It seems to me that they may be buying intermediate
goods, means of production at prices below value so that some of the
surplus value embodied in them shows up in the final product (say the
iPod) which the
US company owns. Here profitability is maintained for some capitals
at the expense of other capitals which are getting pushed to the
wall. This simply can't happen in Kliman's single system because the
value transferred from say the intermediate goods is simply the value
of the money required to purchase them at current prices. But let's
say the
value transferred from these intermediate goods is given by their
actual value and they are purchased at prices below their value; then
the profits of US companies also include the surplus value produced
by the workers in the supplying firms farther down the value chain.
US profits then combine
exploitation of workers at home and abroad. And you couldn't separate
high US profitability from low supplier country profitability with
all the pressure on the workforce that this implies.

Kliman's system can't account for this kind of thing as far as I see.
It's one empirically important reason to reject his argument for a
single system. And it will be no problem finding places where Marx
speaks of surplus value being claimed farther down the value chain so
to speak.

Now here is my response to that very short paragraph:

First, Kliman seems to be saying that value transferred in a value
economy is determined by value of the mop themselves while value
transferred in a price of production economy is determined by value
needed to acquire mop at current prices. But why would this be so? Of
course he could be saying that value transferred is always determined
by value needed to acquire mop and in a value economy the value
needed to acquire mop is the same as value of mop themselves (this is
why Smith could conflate a command and embodied labor theory of
value).  This is the missing premise to his own argument.  But should
value transferred be determined by value needed to acquire mop at
current prices rather than the value of the mop themselves? Where is
the theoretical argument? And it's clear in many, many places--too
many places to count--that Marx understands value as the sum of the
labor value of  the mop themselves and the labor added. It's what
Ricardo thought and I know of not one passage where Marx challenges
Ricardo on that point! As Kliman himself notes, the places in which
Marx does infer the value transferred frm the value needed to acquire
mop at current prices are those places in which he still assumes
price is proportional to value. But once he drops the assumption,
then he notes that there are two reasons for divergence. Allin was
right, and I am right to agree with him.

Second, Marx is clearly talking about double divergence between
commodities' value and their respective prices and a commodity's
value and its price. Kliman  says that since Marx did not speak of
the latter, then he is comparing two different kinds of economies--a
value economy and a price of production economy. This seems to be a
non sequitur to me. At any rate this reintroduces a kind of dual
system--a value system and a price of production system. What is the
status of the former? Is it is only a mental construct or a
historical stage? No clarity here in this one short paragraph. It
seems that Kliman hs argued himself into a corner, reintroducing two
systems to save his one system. I on the other think that the value
system only exists in, as and through the price of production system
which brings into existence the law of value even as it generates the
contradictory tendency of the equalization of the profit rate . So
Marx could not be and more importantly should not be comparing a
value system to a price of production system.

And why did Kliman not cite Allin and me for together making the
argument and putting the two passages on double divergence together?

And why does he not quote those two passages about double divergence
in full as he seems to recognize the importance of these passages?
Indeed the passage from the 1861-63 manuscript will show that the
quote he takes on page 107 is simply out of context, and it is the
strongest evidence he has!!! But the passage as a whole is pretty
garbled; we are best taking the passage from Capital 3 on double
divergence, and here Kliman is simply twisting it in unreasonable
fashion while arguing himself into a corner. He thinks Samuelson was
exemplary in the capital switching debate; Fred has been just that in
admitting these two minor passages create problems but should be


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