[OPE-L:7257] [OPE-L:782] Re: Assumptions

John R. Ernst (ernst@PIPELINE.COM)
Sun, 28 Mar 1999 02:21:56


Let's discuss your "OPE-L 781."

Referring to Marx, Andrew wrote in OPE-L780.

> He says the profit rate must fall even if workers were to live on
> air. Elsewhere, he says that the profit rate must fall even if the
> full 24 hours of the day were to be appropriated by capital. Still
> elsewhere he says that nothing is more absurd than to explain the
> fall in the profit rate on the basis of rising wages.
> A correct interpretation must correspond to the original theory. (I
> don't think there's really any disagreement about this.) <snip>

Jerry wrote:

I think it is a "correct interpretation" to assert that the category of
wage-labour was crucial for Marx. To assume v = 0 as above (I put aside,
for the moment, whether the assumption of v = 0 was actually made in the
passages that Andrew is referring to above. Listmembers might recall that
we had an exchange from way back on that topic in the "assumptions,
assumptions, assumptions" thread), is a hypothetical construct that
assumes away the very *possibility* of a capitalist economy. It even
asserts that if wage-labour were eliminated/surpassed (zero v), we
will still have capitalism!

John comments: Wait a minute. Where is the v=0 assumption? Why
have you jumped on this? I would have hoped that no one on this
list would equate the assumption that v=0 with the idea that there
is no wage labor. Here my hopes are dashed. This is truly silly.
Why not just assume that the real wage is .000000000000000000000000
0000000000000000000000000001 whenever you think someone says, "let
v=0." Do you then have a problem? Is so, what is it?

More seriously, I don't think either Marx or Andrew ever thought that
the real wage would be 0. The point of assuming that the real wage is
0 is *not* to claim that capitalism can do without workers but rather
to argue that even if the real wage is constant, the rate of profit
can fall for Marx and for Andrew. The real wage in the accumulation
process is not the independent variable even in the period of
manufacture. We read this in Vol. 1 Ch 25.

Jerry wrote:

Moreover, if a theory says that the rate of profit falls _even when
there is no wage-labor_, then this is a *big* mark against such a theory!
For it suggests that the fall in the rate of profit is *trans-historical*
and occurs even where there is no wage-labor!

John comments: You're getting excited by your own construct. You've
equated the assumption of 0 real wage with no wage-labor. No one else
is doing this. Again if it bothers you, simply make the real wage
No one would have a problem with this. Indeed, I thought we traveled
this path before when you had everyone saying, "Assume that the real
wage is very, very, very, very, very small."

Andrew wrote:

> In the
> original theory, the profit rate falls *because* productivity rises,
> and it would fall even if wages were zero. (I don't think there's
> disagreement here either.)

Jerry wrote:

See what he has pinned on this *assumption* of v = 0? First he makes this
assumption and then -- far from being a convenience to simplify the math
(as some once suggested) -- he comes to a strong *conclusion* about the
role of wages and falling productivity based (in its strongest version, as
above) solely on his assumption.

John comments: What? I really think your comment is unclear. Where is
the falling productivity to which you refer? Suppose Andrew had said

> In the
> original theory, the profit rate falls *because* productivity rises,
> and it would fall even if wages were .000000000000000000000000000001.

Would you still have a problem? If so, we might have an interesting
discussion about this matter? If not, what are we talking about?

Jerry wrote:

*At the very least*, he would have to demonstrate conclusively that:

a) Marx made this assumption;

b) it is a valid assumption to make in a situation where we are developing
a theory of capitalism.

Andrew has failed to date in both of these tasks.

John comments: So what? I hope he gives the tasks you assign him no
time at all. Clearly, he'd get the same result if he had assumed that the
real wage was .000000000000000000000000000000000000000000000000000001
or something even smaller. The assumption itself puts the focus of
the theory on the accumulation of constant capital and technical change.
Again, all we need to show Andrew's argument is in Marx's work is to
recall, again, that the level of wages is the dependent variable. It
is, in the final analysis, a dependent variable in the accumulation
process and not an independent one.

Andrew wrote:

>-- > It is true that, when the value of labor power is constant,
> technical change that is labor-saving and capital-using will lower
> the rate of profit on new investment. Yet, given a zero real wage,
> such technical changes would not be viable.

Jerry wrote:
So what? "Given a zero real wage" is an artificial situation that has no
meaning for how we interpret the dynamics of the capitalist accumulation

Indeed, capital accumulation and reproduction itself would be impossible
with such an assumption. E.g if there is zero v then *by definition* even
simple reproduction would be impossible.

John comments: Again, assume Andrew had said that the real wage is
.00000000000000000000000000000000000000000000000000000000000000001 and
falling. Your critique does little but belittle Andrew's point --
the fall in the rate of profit does not depend upon labor-saving and
capital-using technical change. Indeed, for Marx the rate of profit
can and does fall even when capital-saving techniques are used. The
degree to which they are labor-saving as well, which they generally are,
is not the focus.

Basically, if you are arguing that the level of the real wage must be
considered in order to grasp the fundamentals of the accumulation
process, then do so in a straight forward fashion. I'd listen and
perhaps have some way of either agreeing or disagreeing. But instead
you impute to Andrew the notion that capitalism can exist without
wage labor as he attempts to argue that it is not the level of wages
that causes the fall in the rate of profit. Hence, my challenge to
you is to disagree with Andrew if you want to but do so while assuming
that the real wage is very, very, very, very, very, very, very small
and either constant or falling. Should you simply keep jumping on
this v=0 assumption without also considering a real wage of
.00000000000000000000000000000000000000000000000000000000001, I would
assume you really are not into a discussion of the nature of
technical change but prefer to change the subject to something more
to your taste.

Jerry wrote:

Bottom line: the conclusions that Andrew is making rely heavily on the v
= 0 assumption. This is a assumption at odds with Marx's
understanding of the essential class relations of capitalism

John comments: What are you talking about? What conclusions? That
technical change need not be capital-using and labor-saving for the
rate of profit to fall? I'm with Andrew and Marx on this one. If
you disagree, then do so. Your "bottom line" suggests that the
level of the real wage is part of the "essential class relations of
capitalism." I disagree.

If you actually deal with the problem of technical change and choice
of technique as Andrew and I have, then I think you'd agree that
the assumption v=0 is made solely for the purpose of simplification
and one which neither of us uses as a basis for our conclusions. It
does indeed simplify the math. It is *never* made to assert that
workers receive a real wage of 0 and for some reason go on working.
That would be stupid. I'll let you decide how stupid it is to go on
arguing that it is stupid.