[OPE] Specially for Patrick Bond: David Harvey on equilibrium

From: Jurriaan Bendien <adsl675281@telfort.nl>
Date: Thu Sep 17 2009 - 02:20:37 EDT

I take it from the fact that you people don't respond to my substantive
argument, and start talking about hot air pressures, disequilibrium,
statistical relationships etc. that you agree with me - silence means

Jerry's vulgar Marxism boils down to saying that "how can you meaningfully
talk about variables, without constants" ? Well, quite, but that is neither
here nor there, and does not speak to my argument. Marx described the
necessary minimal proportions for the expanded reproduction of capital
without referring to equilibrium at all. He knew very well that there are
constantly adjustments in response to the uneven development of business
sectors, and that there are disproportions all the time, which, at a certain
point, become critical for the system as a whole, without there being any
market balance at any time.

The core argument of bourgeois economics is that market trade, if unimpeded
by exogenous influences, tend spontaneously by means of price movements to
create a balance of supply and demand, and this is generalised to the
economy as a whole, such that if things are left to the market, a general
equilibrium will spontaneously result. This argument is accepted by the
bourgeois Marxists, who then just argue that the economy moves from
equilibrium to disequilibrium, and back again. But as I point out, this
confuses supply-demand balance with price stability and social order, and
they are not at all the same thing. If you think they are the same thing,
you don't deserve to call yourself an economist.

How can there be disequilibrium without equilibrium? Well as a matter of
fact very easily - we could just admit there is disequilibrium (lack of
market balance between demand and supply) IN REALITY compared to the
IDEAL-THEORETICAL state of equilibrium which DOESN'T EXIST and is in fact
never reached, and for which there is no empirical proof or evidence. And
that is precisely what bourgeois economics, in its Marxist and non-Marxist
guises, often argues.

In his Bundesbank speech on January 13, 2004, Alan Greenspan, stated:

"Globalization has altered the economic frameworks of both developed and
developing nations in ways that are difficult to fully comprehend.
Nonetheless, the largely unregulated global markets do clear, and, with rare
exceptions, appear to move effortlessly from one state of equilibrium to
another. It is as though an international version of Adam Smith's "invisible
hand" is at work."

That is a perfect description of the bourgeois ideology, and the only
modification by the bourgeois Marxists is, that equilibrium is interrupted
by crises, through which equilibrium is restored.

The bourgeois Marxists just save their market equilibrium ideology by
redefining the meaning of equilibrium to suit their purpose, that is all,
they wax profoundly about systemic equilibrium or stochastic equilibrium
etc. but that is just playing with words and misses the substantive argument
by a mile. They have bought into the bourgeois ideology which conflates
market-balance with social order and price stability in a completely
unscientific way.

You can talk statistical poetry all you like but I am talking about the
foundational concepts on which the poetry is based.


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Received on Thu Sep 17 02:24:41 2009

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