[OPE-L:4678] Re: real wages and the rate of surplus value

Ajit Sinh (ecas@cc.newcastle.edu.au)
Wed, 9 Apr 1997 00:12:46 -0700 (PDT)

[ show plain text ]

At 07:51 AM 4/8/97 -0700, Jerry Levy wrote:
>Ajit wrote in [OPE-L:4666]:
>> >I have a very simple question for you: [irrespective of what Marx did or
>> >did not write so that we don't get into a long exchange of Marx quotes]:
>> >can trade union struggles succeed in raising real wages over time?
>> If productivity is rising, then answer is yes.
>Is the "key" productivity? I'm not so sure. No doubt, if you look at
>actual changes in wages, then both firms and unions engaged in
>"labor-management cooperation" have tried during the post-WW2 period to
>link wage increases with productivity increases.

I'm not linking wages to productivity. My point is that without an increase
in productivity if you let wages rise secularly then it will squeeze the
profit out to zero and capitalism would collapse. However, in Marxist theory
a collapse of capitalism does not come about due to rise in wages.
Therefore, a secular rise in wages is only possible within the theory if
productivity is rising as well.

>> >If you answer "yes", then I have a couple of follow-up questions:
>> >(1) where was this subject developed more concretely in _Capital_?
>> Nowhere. For simple reason. In Marx's scheme of things, wages were not
>> supposed to rise but fall.
>So, your interpretation is that Marx held that real wages were constant
>over time?

As I said, time and time again, for a time period of a business cycle or so,
say long term, the real wage basket, on the average, is held constant.
However, in the secular time period it has a downward tendency.
>> You should keep in mind that Marx also believed
>> in falling rate of profit over time. So accumulation, on the one hand, was
>> supposed to "set labour free" at an increasing rate, and on the other hand,
>> reduce the rate of profit meaning the rate of growth of the system. Thus in
>> Marx's scheme the nature of capitalist development was such that there would
>> be a downward pressure on wages. Trade unions could fight and resist this
>> downward trend but they could not turn the historical tendency around.
>The above would only be the case if you believe that the industrial
>reserve army would grown continuously with the advance of capitalist
>accumulation. If one believes instead that the size of the IRA and
>the demand for labour-power fluctuates alongside changes in the rate of
>accumulation and the trade cycle, then a different "scenario" emerges.

I don't understand what you are talking about. A fall in profit rate would
reduce the rate of growth, which itself would reduce the rate of increase in
the demand for labor on its own account. On the other hand the nature of
tecnical change is also reducing the demand for labor per unit of capital.
Given a rate of growth of population, shouldn't one expect the rate of
unemployment to rise? What "scenario" you are talking about?

>> [...] For Marx's own theoretical perspective, it was important to have
>> real wages or rather the wage basket given from outside the market for
>> commodities. If the
>> value/prices of production of labour-power was determined according to the
>> 'law of value', then he could not hold the proposition that the 'reserve
>> army of labour' is a persistent and structural aspect of capitalis
>Could you explain the last sentence more?

'Law of value' works on adjusting supply of commodities to a given demand.
No commodity produced in capitalism has a persistent excess supply. However,
labor-power has.
>> I think it is quite unsafe to try and develop a theory of historical
>> changes. Historical changes to a great extent depend on chance factors--a
>> throw of dice. I would rather shy away from developing a theory about
>> 'abnormality' that may develop in the future.
>I certainly would not quarrel with the proposition that "chance factors"
>play _some_ role in explaining concrete historical changes. Yet, I would
>say that all modes of production have a certain logic that can be
>identified. In terms of conceptualizing capitalism as a _dynamic_ system,
>I think that it is very misleading to refer only to the "normal" since
>that seems to imply a certain ahistorical static equilibrium framework
>which is incapable of expressing the changes that occur within that mode
>of production over time.
>I, for one, could not tell you what is "normal" for capitalism or how often
>that mode of production is in a "normal" vs. an "abnormal" state of
>affairs. For instance, from my perspective, if one can identify a "normal"
>equilibrium situation, this does not by itself tell you whether the system
>is in equilibrium normally, or if it is in equilibrium whether it will stay
>in equilibrium, or if it is in disequilibrium whether it will head
>towards equilibrium or get to equilibrium. I would say, rather, that the
>'normal" equilibrium situation is only an abstract latent possibility.
>But ... the above are rather controversial points, as you are I'm sure
>well aware.

Normal does not mean "equilibrium". Unemployment of labor in capitalism is
not an equilibrium situation but it is quite normal. I'll try to respond to
your remaining post may be tomorrow. I'm feeling very tired now. Just gave a
seminar on 'Althusser-Sraffa Connection'. Cheers, ajit sinha
>> But they can also be expressed as labor magnitudes, independent of money.
>At the risk of being repetitive, let my again suggest that these "labor
>magnitudes" must necessarily within the bourgeois mode of production come
>to be expressed as money magnitudes.
>But, I guess, a fuller discussion of that topic would get us back into a
>discussion of the "single-system" vs. "dual system" interpretations.
>> Now, when you measure them in money a descripancy between the two measures
>> arises. The question is why should the money-measure be preferred over the
>> labor-measure?
>I don't think it's a question of preferring one "measure" over another.
>Rather, [socially-necessary!] labor-time is the substance of value which
>must necessarily come to be expressed as money due to the nature of the
>value and commodity forms.
>> As far
>> parameters of the system, the competitive forces of the system would
>> ensure realization of values at that prices. That's all we need for the
>> limited proposition we are making.
>It's one thing to assume that commodity values are realized (or rather
>ideal values become real/actual values) or to identify the conditions
>under which this might happen. It's quite another thing to assert that
>"the competitive forces of the system would ensure realization of values
>at that prices." I see nothing that would "ensure" this possibility.
>In solidarity, Jerry