[OPE-L:2389] RE: commodity money in Marx's theory

Duncan K Foley (dkf2@columbia.edu)
Tue, 28 May 1996 08:58:21 -0700

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On Mon, 27 May 1996, Chai-on Lee wrote:
(among other things)
> [3]. Main difference between me and others
> The main difference between us appears to be that I do want to
> discriminate the credit money from money itself while others do not
> care about it. What was a credit money in one zone of trade can be
> seen as money itself in another zone. A credit money cannot settle the
> debt but money can do it. The state paper money is also to be
> distinguished from today's paper money circulating domestically.
> The bank account is another kind of credit money. And so on.

I think you raise a real problem here. But perhaps the final settlement
function has become more political than purely economic in contemporary

> [4]. With regard to the logical orderings:
> As far as the logical orderings are concerned, I think Duncan, Riccardo,
> fred and I are all in agreement. If the money is not to be a commodity,
> the determination of the value of money must be explained independently
> of the LTV.
> Duncan is unique in trying to do this, in trying to conclude the non-
> commodity money conception. If he succeeds, then the whole system
> of Marx shall be abandoned.

I think this is too strong. You can still see money as representing
abstract labor even if the money is a unit of account linked to the state.
The source of surplus value is still unpaid labor.

It seems to me that we have historically experienced an extension of
Marx's value form analysis in which the pure exchange value function has
separated itself from produced commodities like gold and come to have an
independent existence in the unit of account (like the dollar or Yen)
representing the credit of the State. Is this so improbable?

If one doesn't follow this path, then where do you locate the link between
the national currencies and produced commodities in the present world
monetary system?

> More powerful criticism of marx than ever.
> If the value of money is determined in the way other than the LTV, why
> not the values of other ordinary commodities being determined in the
> same way?

I don't see why the two have to be linked. State credit is a derivative
form of the commodity producing society, and its value is governed (even
in Marx's own analysis of State borrowing) by very different mechanisms
from produced commodities.