[OPE-L:5392] RE: Luxury goods and profit rate

Ajit Sinha (ecas@cc.newcastle.edu.au)
Sun, 31 Aug 1997 19:55:43 -0700 (PDT)

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At 09:38 26/08/97 -0700, Riccardo wrote:
>The points here are two, but connected:
>(i) why I speak of a privilege to monetary macro view?
>(ii) the rate of exploitation as length of the social total working day
>less the necessary labour needed to produce the real wage, assumed as given.
>Now, over (ii) there must have been some confusion (because of my
>English?). In the phrase quoted I exactly meant to SUPPORT your position
>here. My difference with you, may be, is on the *interpretation* of talking
>of exploitation as (embodied) surplus labour. If I understand you well, you
>stress the similarity between capitalist exploitation and feudal (or, in
>general, precapitalist) exploitation. I rather stress the disomogeneity
>between capitalist and pre-capitalist exploitation. I hold that for Marx
>the product, as value, can be reduced to labour only in capitalism, and
>hence the exploitation as depicted in (ii) can be affirmed rigorously only
>for a capitalist situation. I never spoke of something so mysterious to me
>as a monetary measure of exploitation. Differently for many others, I think
>that money is crucial for Marxian political economy, but first of all as
>the finance needed to start the production processes, which - again, as I
>understand well - is far away from most of new 'monetary' Marxists who
>stress money as means of exchange, or as store of value, or as unit of
>account etc. I hold that in a macromonetary view the fact that the
>capitalist class has a privileged access to money is what account for the
>ability for firms as a whole to define the composition of output (i.e.,
>defining what will be the wage goods for workers), and hence to produce
>exactly the result in terms of exploitation which you stress.
>So, we are back to (i), but in a way which I do not see as too much opposed
>to your views. Let me say now simply that there are many persons on this
>list - two examples: Duncan Foley and Fred Moseley; but may be also Simon
>Mohun and Duménil-Levy - who agree on that proposition about method, but
>gives a different definition of exploitation. My point in the post you
>quoted is to say that indeed a macromonetary view lends support to the view
>of exploitation in embodied abstract labour terms, because in this view
>what matters is what the working class consumes, not what the individual
>worker consumes.


You are right. I think we are quite close in our understanding of the
concept of exploitation in Marx, and that is the most crucial aspect.
However, I wonder how your point that capitalists are able to exploit the
workers because of their control over finance needed to start the
production process is different from the classical Marxist position, which
I also hold, that capitalists are able to exploit the workers because they
control the means of production. Isn't the control over finance is a
surrogate for control over the means of production? I have not denied the
significance of money in the context of analyzing capitalist crisis. I'm
wondering about its significance in the context of long term price

About your other point, I agree that the product as value 'can be' reduced
to labor only in a capitalist system. Of course, in a feudal system there
is no need to go via products to reveal or bring to light exploitation in
the system. But one has to keep in mind that the classical Marxist position
that prices are naturally the manifestation of labor cannot be taken for
granted any more. Values must be defined in terms of labor and the choice
of this unit must be defended on some theoretical ground. My point is that
once we make relations that produce surplus, and so exploitation defined in
labor terms as the central aspect of the theory we have a justification for
defining values in labor terms. Cheers, ajit sinha
>>> That is, the whole of individual capitalists' behaviour, backed by
>>>the banking system, is not just the way the capitalist class appropriates
>>>the 'profit-goods'? And hence, cannot we say that necessary labour is the
>>>labour embodied in the production of wage goods, and surplus labour the
>>>labour embodied in the goods which are not made available to workers?
>>> The important points here are two: (i) bank finance to production
>>>allows firms to decide the composition of output; (ii) the monetary nature
>>>of capitalism means also that there are subjects (firms, the State) who
>>>can define their demand in real terms, while that's not true for workers
>>>as a class.
>>The question is why should composition of output determine the rate of
>>exploitation? Unless, we make the claim that the composition of output
>>determines the real wages. But that begs the basic question I have raised
>>in my response to Duncan in my previous post. I think that the monetary
>>point of view implicitly makes the argument that class struggle is about
>>the sharing of the given net output between the working class and the
>>capitalist class, and this struggle takes place at the level of price
>>determination, one way or the other. My position is that relative price
>>determination is not the cite of class struggle in the long term sense. it
>>is the length of the working day, week, or year that is the true cite of
>>class struggle. And if you look at the history of capitalism, then I think
>>my position comes out to be much stronger.
>Again, here it seems we are on the same side of the barricade, BUT for the
>fact that what I am saying is that your statement must be supported by a
>truly macromonetary view. The fact is that the site of the class struggle
>is production, but that in a monetary economy production must be started
>(with money) and wages are paid in money. Hence, we have a monetary
>sequence. My view is that if we look at this monetary sequence in class
>terms, we see - sorry if I repeat myself - that the monetary nature of the
>capitalist economy means that there is one class, workers, that decide in
>nominal terms, and another which decides in real terms (I am talking about
>*classes*). Thus, though the wage bill is paid in money, the capitalist
>class is able to define the real wage for workers and extract a surplus
>product from surplus labour.
>I don't understand why to say that the composition of output determines the
>real wage begs the question.
>>Good to see you back on ope-l. I had intended to respond to your earlier
>>message. But since you were gone, I thought I would do that when you come
>>back. But it's been too long and now I can't find your earlier post. But I
>>guess we are discussing the same issues anyway. Cheers, ajit sinha
>Yes, it is the same issue - though taken from this side may be our
>differences are much less that on the interpretation of value theory. But
>it is important to agree, and not only to disagree.
>Sorry for the delay in asnwering, but I was in England in the meantime and
>had no easy access to Mac computers on-line.