[OPE] Reply to Paul C. and Dave Z. on PUPL, accumulation etc.

From: Jurriaan Bendien <adsl675281@telfort.nl>
Date: Sun Jan 11 2009 - 08:39:00 EST


Fair enough, but I don't propose to deal with Sraffa's theory right now,
among other things I do not have the relevant literatures with me here
to refer to. Similar to the way Sraffa demonstrates severe problems with
the marginalist theory of factors of production, capital and profit, I
think you can prove (in some way a bit similar to Michio Morishima's
derivation of the category of surplus-value from the category of profit)
that the concept of "price" presupposes a concept of "value" which
cannot itself be completely derived from prices, and that Sraffa's
argument is in part dependent upon how inputs and outputs are themselves
defined. That is, Sraffa cannot specify price relations/magnitudes
without making value assumptions which cannot be inferred from prices
only, and (among other things) he cannot specify output magnitudes
without reference to input magnitudes and vice versa. Obviously if you
reject the notion of an equalised rate of profit altogether on the
ground that it never exists in reality, the whole Sraffian argument also
breaks down.

I have no problem with the Smithian notion that some economic activities
"depend" on other economic activities, and thus that the production of
non-basic goods "depends" on the production of basic goods in some
sense. For anybody capable of analyzing the division of labour this is
not in dispute.

What is in dispute is:

(1) the nature of that "dependence" (e.g. the policeman may depend on
the baker for his bread, but if the baker is not protected by the
policeman, his ingredients may be stolen so that no production of bread

(2) how we can non-arbitrarily distinguish between net new income
generated in society and transferred income, and between net new
additions to wealth and transfers of wealth; and how we can
non-arbitrarily define what labour is really necessary to create that

(3) whether or why the "dependence" of some kinds of production on
others has any relevance for the definition of labour as "productive"
or "unproductive".

If I prefer Marx to the doctrines of Marxism, that is because I think
Marx's analysis is actually a whole lot better than a century of Marxist
crudifications and quasi-religious misrepresentations of it. So you have
to rescue Marx from the Marxists.

My reference back to what Marx means is not arbitrary since Paul C. and
Dave Z. claim to base their theory of value and economics on Marx, yet
their theory vulgarises Marx's own argument in several ways. In Capital
Vol. 3, chapters 30-32, Marx highlights precisely the dyssynchrony of
the accumulation of money capital and the accumulation of "real" capital
(by "real capital" Marx means tangible productive assets or "genuine"
industrial capital). But point is he never argued that accumulation of
capital refers only to a net increase in the physical asset stock - the
actual problem he tries to analyze is rather that the accumulation of
money capital in fact may, or may not be, an "index" of enlarged
reproduction. In Marx's theory, the dynamic of capitalist trade arises
precisely out of the divergence of prices and values which attain a
semi-autonomous existence from each other, which has its corollary in
the dyssynchrony between accumulation of money capital, the accumulation
of commodity capital and accumulation of production capital - it is the
fact, that goods may trade above or below their value, and that
available money capital may or may not adequately express commodity and
asset values. Capitalists constantly seek to buy below value and sell
above value, it is just that their ability to do this is ultimately
constrained by the ability to extract surplus value from human labour.

The limitation of Marx's analysis is not that he adopts a crude and
vulgar view of what the "capital stock" is. Rather, it is that he is
concerned exclusively with "the monetary loans that the bankers, as
intermediaries, make to the industrialists and merchants." (Pelican ed.,
p. 610) and he assumes that finance capital will be subordinated to the
requirements of production capital. But this conflates the requirements
of the capitalist mode of production with the requirements of capitalist
society. In fact, as Rudolf Hilferding, Michael Hudson, Joseph Steindl
and Jan Toporowski point out, finance capital increasingly dominates and
delimits the development of production capital.

In the Cockshott/Zachariah social ontology, what is "real" is physical
production and social relations between people, while legal claims to
property, and trade using money-tokens, are "ideal" or symbolic and not
real. But I regard this as a "mechanistic (pre-Newtonian) materialism",
not in the least because the "ideal" is also real.


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