[OPE-L:4903] Re: ideal vs real value

Gerald Levy (glevy@pratt.edu)
Sun, 4 May 1997 08:07:25 -0700 (PDT)

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Before commenting further, I want to say that:

a) the delay in continuing this thread is most probably caused by the
desire to develop a thoughtful response to, among other posts, [4873],
[4874], [4876], and [4889].

b) the decrease in volume would suggest that now might be a good time to
raise additional topics for discussion. Let's remember that many schools
will close for the summer next month and listmembers will be on vacation,
so it is better, IMHO, to raise subjects for discussion now than to wait
till later.

I now will return to the discussion of the "conservation of value"

(1) The creation, transfer, and destruction of value

The conservation of value principle holds that the magnitude of value is
determined in production and can not be increased _or decreased_ in
circulation. According to that principle, the magnitude of value is
"given" following production and can not be "lost" , "spoiled" or
"destroyed." Rather, if one accepts that principle, then value and surplus
value can *only* be re-distributed among capitalists. Thus, in considering
the affect of technical change, the magnitude of value and s "lost" by
some capitalists is _exactly_ equal to the magnitude of value and s
"gained" by other capitalists. The result is then like a "zero-sum game".
>From my perspective, this theorem has the very real disadvantage that
it denies the possibility of the *destruction* of capital values such that
the aggregate magnitude of value can be *diminished* rather than *only*
transferred. This *destruction _and_ redistribution* of value is
precisely what I believe occurs in a crisis.

Is there _any_ reason to believe that the magnitude of value can not be
diminished following production _except_ as an assumption, i.e. if we
stipulate that the magnitude of value is "given" following production,
what is the logical reason for assuming it to be "given"?

Further, during a crisis if some portion of the total product physically
degrades because it was not able to be sold "within a definite period of
time" (and therefore can not continue to be a bearer of exchange-value),
*why* would we expect -- *except* by assumption -- that the "value" "lost"
or "spoiled" by some capitalists to be _exactly_ equal to the magnitude of
value gained by other capitalists?

(2) The algebra of value

If we reject the conservation of value principle and insist on the
distinction between "ideal" and "real/actual" value, then ... don't we
have to introduce an additional "unknown" into our calculations on value?
Wouldn't this mean that there are _too many unknowns_ to solve the
equations???!!! Or, alternatively, if we take the magnitude of "value" as
"given" by assumption, wouldn't we have to recognize that all of our
calculations on "value" really are _not_ calculations of "real" value, but
rather calculations of "ideal" value???!!!

To continue ... what would happen to all of the "solutions" to the
transformation and calculations regarding the tendency for the general
rate of profit to fall (New Solution and TSS solution included), if the
"conservation of value" principle was rejected in the sense that "value"
could _diminish_ following production? Wouldn't we no longer have the
same determinate results??? Is this desire for determinate results a
major reason for resistance to rejecting the "strong version" of the
conservation of value principle? Is this good theory, i.e. should we let
the desire to develop solvable algebraic equations unduly simplify a
complex topic?

In solidarity, Jerry

PS: Gerard Dumenil and Dominique Levy, two former listmembers, presented a
paper at the IWGVT conference concerning the conservation of value
principle which many listmembers may not have yet seen. If this is
"unencoded", perhaps it should be posted on this list for discussion.