[OPE-L:2537] thoughts on Gil and Chapter 5

Michael Perelman (michael@ecst.csuchico.edu)
Tue, 18 Jun 1996 17:37:38 -0700 (PDT)

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Gil sent me a copy of his Vancouver paper. Here are my thoughts.
Marx used value theory to advance beyond the moralistic
discussions of exploitation common to his day. Prior to Marx,
radicals of all stripes saw exploitation within the context of a
moral economy. Wages were too low or interest was too high.
Even more thoroughgoing radicals who challenged the system of
private property based their protest in terms of justice.
Justice, however, is a very subjective concept, open to various
interpretations. What is too high a price? Should all the land
in North America revert back to the Native Americans? Should the
descendants of slaves also be expropriated? Marx attempted to go
beyond such questions with his concept of value.
To develop his value theory, Marx presupposed a capitalist
system, including wage labor. Let us call this Marx's logical
analysis of value. Now, Gil asks Marx to show how we can deduce
wage labor from value theory. I do not think that Marx or
anybody else ever believed that we could ever deduce everything
from the nature of value.
Here we get to the tricky part. Marx did use his logical value
theory to analyze contradictions within capitalism. These
contradictions, in turn, implied change. Remember that Marx
wanted to develop the laws of motion of capital. Just as he
projected forward toward the end of capitalism, Marx also shows,
much as Adam Smith had done before him, how capitalism evolved
out of the contradictions with earlier modes of production.
This historical analysis gives rise to what became known as the
historical transformation problem. According to this theory,
simple values exist a barter system or petty commodity
production. As concentrations of capital accumulate [somehow] in
the hands of a few people, prices form that deviate from values.
In a sense, we are deducing fully developed capitalism from these
earlier modes of production.
Thus, as Gil shows, surplus value can arise from merchant capital
or usury. Perhaps the most example of non-capitalist production
of surplus was the work of the slaves on the U.S. cotton
plantations who produced the crucial raw material for British
We must keep in mind that Marx's capitalist mode of production is
an abstraction, not a precise description of reality. Wage
laborers, slaves, usurers, and merchant capitalists all inhabited
that world in which he lived. In moving from the abstract mode
of production to the real world, we should expect some
Gil tells us that we should pay attention to this inconsistency.
I agree. Unfortunately, he bends the rod the too far, suggesting
that we abandon logical value analysis and move back in the
direction of an analysis that ultimately rests on subjective
judgements about justice.
My understanding of Marx's project is different. I read him as
telling us that capitalist exploitation can exist in spite of the
appearance of justice. I am drawn of many citations along these
lines. There Marx wrote:
The organization of the capitalist process of
production, once it is fully developed, breaks down all
resistance. The constant generation of a relative
surplus population keeps the law of the supply and
demand of labour, and therefore wages, within narrow
limits which correspond to capital's valorization
requirements. The ”silent compulsion of economic
relations• sets the seal on the ”domination of the
capitalist over the worker•. Direct extra-economic
force is still of course used, but only in exceptional
cases. In the ordinary run of things, the worker can
be left to the "natural laws of production," i.e., it
is possible to rely on his dependence on capital, which
springs from the conditions of production themselves,
and is guaranteed in perpetuity by them. It is
otherwise during the historical genesis of capitalist
production. The rising bourgeoisie needs the power of
the state, and uses it to "regulate" wages, i.e., to
force them into the limits suitable to make a profit,
to lengthen the working day, and to keep the worker
himself at his normal level of dependence. This is an
essential aspect of so-called primitive accumulation.
[Marx 1977, pp. 899-900; emphasis added]

Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 916-898-5321 E-Mail michael@ecst.csuchico.edu