Re: [OPE-L] SV: [OPE-L] what is irrational in the functioning of capitalism?

From: ajit sinha (sinha_a99@YAHOO.COM)
Date: Wed Nov 29 2006 - 15:32:28 EST

--- Paul Cockshott <wpc@DCS.GLA.AC.UK> wrote:

> Ajit wrote
> _______________________________
> Ian, I think you have missed the point. So let me
> try
> to get at it another way. Now, the idea of labor
> displacing technical change plays an important role
> in
> Marx's theory (Ricardo had already acknowledged in
> the
> 3rd edition of the Principles that at least
> logically,
> if not empirically, machine can displace labor in
> aggregate terms). Now, follow Marx's logic to the
> extreme. Allow technical change to continuously
> displace labor to the extent that the live labor's
> role in the production process becomes negligible.
> At
> this limiting case, if you apply Marx's exercise
> then
> either you have to argue that the value of all the
> commodities must tend to zero and the rate of
> surplus
> value must tend to infinity; or that the rate of
> profits must tend to zero. Now, Marx's or many
> Marxists position could be that of course the rate
> of
> profits must tend to zero because the case
> represents
> the c/v tending to infinity. But the problem with
> this
> answer is that Profit = S/(C+V) is the wrong formula
> for the rate of profits. What I'm asking is: can you
> logically claim that when V tends to zero, then the
> physical surplus of the system must also tend to
> zero?
> If not, then it can be easily shown that this
> limiting
> system will have well defined prices of commodities
> along with positive and equal rate of profits.
> ----------------------
> Ajit, the rise in C relative to V is predicated on
> them
> Both being measured in terms of labour value.
> Suppose we take a pure circulating capital model,
> what does this rise in
> C relative to V entail?
> Can we measure it using any non-labour based unit of
> value?
> In a purely circulating capital system of i.o
> equations the implication
> of C rising relative to V, is that the net product
> available for
> distribution is declining ( leaving aside variations
> in the wage share
> ). This would entail a decline in the ratio of net
> product to gross
> product, and so would involve a decline in the rate
> of profit whatever
> input was used as the standard of value.
Paul, I think you have missed the point as well, I'm
not saying anything of this nature. As I have
suggested above, the limiting case is compatible with
commodity values tending to zero and the rate of
surplus value tending to infinity--meaning Marx's
value accounting breaking down. The basic point I'm
making is simple: for Marx every physical surplus must
represent some amount of surplus labor. That is why
for Marx when surplus labor in the whole economy tends
to zero, the rate of profits must also tend to zero.
But, my argument is that, it is simply not true. The
physical surplus in the whole economy may not tend to
zero, and thus you can have an healthy positive rate
of profits even when the values and surplus value tend
to zero. In other words, the secret of surplus does
not reside in surplus labor. My problem here is a
logical one and not an empirical one (Robot rebellion
is not an issue here). Cheers, ajit sinha

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