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A new sandpit for long side discussions, conspiracy theories, idees fixes and so on.
John Quiggin 
@Ivor
It would help if you could give references in DK Vol 2 to support your argument. It is a long time since I read Das Kapital and Grundrisse in detail. An impression I formed at that time and which remains strong to this day is that Marx’s works were an investigation in progress. The idea that he had reached a definitive result, an entire completed system, either philosophically or in terms of political economy, is not supported by his extant works. Engels attempted to organise and complete the project but significant contradictions and lacunae remain within it.
In addition, knowledge, social progress and technology have all advanced since that day. It is not the case that we should take Marx’s words as the definitive final word on all these topics. Indeed some of his own works re-evolve his ideas and/or contradict each other. It IS the case that we should examine all his work critically, in the light of subsequent progress in philosophy and science, and make our own best determination of the logic and value of his ideas.
One always has to be careful with terms. “Capital” can be a neutral term. One important form of capital is capital equipment. Capital equipment exists under socialism just as it does under capitalism. An ideal worker cooperative bakery has capital equipment. By an “ideal” worker cooperative bakery, I mean one is which all workers have equal ownership, perform equal work and have an equal say (full democracy) in all decisions of the cooperative.
It is still the case that the cooperative could grow. More machinery could be added. More bakers or apprentices could be taken on and more bread could be baked. The capital “wealth” of the plant of the bakery could be crudely measured by a count of ovens. We can make crude counts of the wealth of the bakery without using money or capital calculations. At time “t” the bakery could have 5 ovens, 5 bakers and produce 5,000 loaves of bread a day. At time “t+1” where the time added is say one year, the bakery could have 6 ovens, 6 bakers and produce 6,000 loaves of bread a day. (I have no idea of the productivity of contemporary bakeries so these are simply arbitrary figures).
From time “t” to “t+1”, the capital wealth of the bakery has increased by 1 oven or 20%. Whether these ovens are the possessions of worker cooperative bakers or of a single, non-working capitalist owner makes no difference to this equation. The equation remains valid. Of course, the circulation of capital (as money and fictitious capital), its behaviours and systemic results will be widely different under capitalism than under socialism of some form. That is another, huge subject.
But stating that ““t to t+1” is a capitalist fetish within a capitalist society” does not hold. The validity of the “t to t+1” proposition (growth by a flow into a stock) is, in itself, a “truth” of physics and maths. It becomes a fetish when the capitalist mode of ownership and control is advanced as the only possible mode of ownership and control and is pursued to, well, the excess ends we see now in the extant, real world economy. It also becomes a fetish when growth becomes systemically mandated (as it does under capitalism) rather than a rational choice for growth or a steady state or some other state as required by environmental limits and reasonable human need factors.
Footnote: In saying that something, say an equation validated by repeated experiment, is a “truth” (of physics or maths in this case) I am simply advancing the correspondence theory of truth. There are various opinions on this theory but I maintain that it is pragmatically sound.
@Ikonoclast
It is in the chapter/section titled “Simple Reproduction”. The proportions are between workers who produce final consumption goods and those who produce intermediate goods. Marx tagged these as Departments II and I. Of course these proportions may or may not change over time BUT they do not necessarily change just because time has passed or a new product has hit the market.
If the new product required the same distribution of labour – prices stay constant.
If 80% of workers produce consumption goods, and 20% produce intermediate goods, then(once this is established) this determines prices irrespective of any changes in any basket of goods over time.
The constancy is a feature of value – how much labour is distributed to produce a particular share of society’s production.
As Marx said – the
is “self evident”.
He also noted that the amounts of products that are consumed reflect determined quantities of “society’s aggregate labour”.
See: Marx 1868 Letter
Obviously, the products can change over time – eg B&W TV (1960) to 3D plasma TV’s (2020), but IF the B&W TV used 1% of Marx’s “society’s aggregate labour” and 3D Plasma TV’s also take 1% of “society’s aggregate labour” THEN there is no change in value and both sell for the same price.
There is one trap in all this – for Marx, money was itself real market value – gold, silver. When our bourgeois economists talk about money today they usually mean IOU’s. You can always increase IOU’s over time, but this just leads to catastrophe. Marx excluded credit from his analysis.
Anyone wanting a simpler approach, just need to think what would happen if the wages share fell over time. Where would this end up?
What would happen if the share going to capital fell over time.
Or if either constantly increased. Where would this end up?
@Ikonoclast
Just to be clearer…
If 5 bakers use 5 ovens produce 5000 loaves and later, 6 bakers use 6 ovens to produce 6000 loaves…
The price of a loaf does not change and the wealth per person does not change, wages do not change, the ratio of capital to labour does not change and one time is as good as the next.
Those spending all their time building ovens get the same share of loaves as they did before and those actually making the loaves get to use the same quantity of ovens as before.
If the bakery collective was to export their oven – they would get the same price for it in both time periods. Its exchange value will not have changed one iota.
Ivor, how do you answer the question: How old are you? And, have you always been that old?
And, is your contribution to your workers’ collective unchanged since you joined it the first time? Was there a first time or are you an eternal god?
“Value is based on your share of a pie NOT the size of the pie.” [Ivor]
This is an example of sloppy theorising on Ivor’s (or Marx’s part).
What if ‘the pie’ is an empty set, or a long list of zeroes?
@Ernestine Gross
Crazy, unrealistic and more than sloppy.
If the pie is an empty set – there is no society.
You have to put a bit more effort into your thinking.
You have not even read Marx.
Ikonoclast, you made a slight change to my definition of wealth, such that the distinction between an individual and the aggregate is lost.
In theoretical models of ‘competitive private ownership economies’ (eg the Arrow-Debreu model), it is the case that an individual’s wealth at a particular time can be described as a share of the total wealth of ‘the economy’. There are conditions on each element of ‘the economy’, which ensure that, in the logic of mathematics, ‘the pie’ (total wealth) is not an empty set and each individual’s wealth is ‘big enough’ (minimum wealth condition) such that each individual has ‘freedom of choice’ (without requiring an equal wealth distribution). It is possible to sensibly talk about a ‘wealth distribution’ across individuals in this model.
In Radner’s sequence economy with commodity and financial markets, one can sensibly talk about ‘wealth distribution’ across individuals over time, and one can sensibly talk about changes in the wealth distribution of categories of individuals over time. (This is the theoretical model underlying Piketty’s work. Perhaps this is putting it too strongly because I don’t know what Piketty thought at the time. Perhaps I should say, when reading Piketty’s book, knowledge of Radner helped me not to get lost.)
@Ivor
“If the pie is an empty set – there is no society”
Not true. There are societies where nobody eats pies as we know them. Therefore, ‘the pie’, defined as the aggregate set of all pies, is empty. The list of pies produced and consumed in this society consists of a list of zeros.
@Ivor
I want to make a specific comment and then some general comments.
“Value is based on your share of a pie NOT the size of the pie.” – Ivor.
This cannot hold. If a pie of 4,000 calories is divided into 4 shares of 1/4 each then each share yields 1,000 calories. If a pie of 8,000 calories is divided into 4 shares of 1/4 each then each share yields 2,000 calories.
C share = C total divided by total number of shares.
The correct statement is that the relative value of your share is based on your share of a pie NOT the size of the pie. Both absolute numbers and ratios matter in certain contexts but the contexts have to be stated.
Your statement “Value is based on your share of a pie NOT the size of the pie.” calls into question your definition of “value”. What do you mean by value? You cannot mean physical quantitative measures of value like calories. Therefore you must mean use value or exchange value, I guess. Use value varies according to the user. A skinny, hungry man will exchange more (if he has it) for a 1,000 calorie slice of a pie than a fat man sticking to a diet. Thus we get to exchange value. There are no absolutes about exchange values. Exchange values are relative and slide all over the place as it were. The only value I can think you refer to is that “I, as an average worker, did 1/11 millionth of the work in Australia last year so therefore I am entitled to 1/11 millionth of the country’s GDP.” This assertion is not one a Marxian would take anywhere. Not when we consider, “From each according to his ability and to each according to his need”. (Apologies for sexist formulation of that. English is awkward.)
I don’t want to pick sides, in relation to yourself and E.G. when discussing these issues, because I suspect I differ from both of you on various points. However, I will say a couple of things. It is one thing to read Marx. It is another thing to read Marx critically.
Now, I happen to hold the position that neither the labour theory of value (LTV) nor the tendency of the rate of profit to fall (TRPF) are absolute or universal truths in any sense, even within a capitalist system. I am not alone in this among modern Marxian thinkers.
The LTV cannot be taken as an inviolable material axiom though it can form the basis of a moral philosophy about distribution of the surplus above the reproductive requirements of labour. Why do I say this? It is simply the case that other sources of value do exist, for example, nature itself. Value (use value) also comes from nature. Marx himself indicated as much. Value can also come from the machines themselves at the sophisticated end of the automation spectrum. This reading comes Marx’s “fragment on the machines” in Grundrisse. It is entirely Marxian, even Marxist, to realise dialectically (i.e. emergently) that high end automation becomes the antithesis of human labour and thus of the LTV. It negates the crude level of synthesis in early stage capitalism with a higher synthesis which can break or at least severely attenuate the connection between human labour and production. In industrial capitalism with crude machines and crude mechanically-automatic machines (crude by today’s standards) the LTV is a good approximation. It can cease to be a good approximation at higher levels of automation. This does not remove the moral force of the LTV. What comes from nature is free (until sustainable limits are exceeded) and what comes from human inventiveness, shared and socialised by time and custom, properly and morally belongs to all.
TRPF also has to be understood in context. It is a real tendency in genuinely competitive capitalism but there are many counter-tendencies including the tendency to anti-competitive beahviour and to monopoly.
@Ernestine Gross
If you were honest you would know that the issue is not restricted to pies.
If you had a bit more education you would know that you could also use widgets or anything.
Your compentancy is awesome.
@Ikonoclast
If you base yourself on the labour theory of value – it all falls out easily.
For example:
If in one day you produce 4,000 calories then 1/4 is exchangeable for 1/4 of someone elses production – say 1 unit of gold.
If in one day you produce 8,000 calories then 1/4 is exchangeable for someone elses production – 1 unit of gold.
In both cases the production of 1/4 day exchanges for 1/4 of a day. It does not matter if this is 1,000 calories or 2,000 calories or a B&W TV or a plasma TV.
Note: production of 8,000 calories cannot coexist with production of 4,000 because the more productive will outcompete the less productive.
If the average worker did 1/11 th million of work then they would, absolutely, be entitled to 1/11th million of national production. But this would not be undiminished proceeds – as Marx explained in his Critique of the Gotha Program.
Value cannot come from machines but diving into this is diversionary.
“Your compentancy is awesome” [Ivor]
You said it.
@Ivor
The specification that 1/4 day of labour of type A on machine type X equally exchanges for 1/4 day of labour of type B on machine type Y, is a normative formulation not a descriptive formulation. It is an (ill-advised) attempt to set a moral and economic norm rather than an attempt to describe real-world behavior and the real-world setting of values (use and exchange) in society.
I could decide that I am “The People’s Poet” like the anarchist Rick in the Young Ones. I could decide my labour consists of 1 sonnet per working day or 3.5 lines of verse in 1/4 of a working day. In my mind, these sonnets would be works of genius deserving adulation… and pay. In the minds of others they would be fustian doggerel worth nothing. Already, we see that 1/4 day of labour of type A (versification) on machine type X (typewriter) does not necessarily equally exchange for 1/4 day of labour of type B on machine type Y. My attempt to normatively define the value of my work fails in this case. The value is socially decided in some manner: anywhere from a command decision, not mine unless I am the dictator, to a market determination.
Thus there can be no valid, a priori normative determination that 1/4 day of labour of type A on machine type X must equally exchange for 1/4 day of labour of type B on machine type Y and so on as we iterate this formualtion.
The labour theory of value, as an incomplete exposition of the origin of value, cannot aid us in setting 1/4 day of labour as equal to any other 1/4 day of labour. The origin of value (use or exchange) is complex and manifold: it originates in the human/social interaction with natural resources and with each others’ forces of human production (labour) and with technology and with human needs and desires. The whole is an interacting complex. The interacting complex generates values and assessment of values.
Note: In the above, I have given an example of “labour without value”.
See: DID MARX HOLD A LABOR THEORY OF VALUE? – 1987 Peter King and Arthur Ripstein.
Click to access LTV.pdf
The conclusion of this article is complex and it leads to further complexities. The LTV is a useful way of looking at things, especially in certain historical phases. It does aid us to see exploitation and appropriate of surplus value which could otherwise go to workers (or widows for that matter). The LTV is not any kind of absolute or complete truth about all sources and all generation of value.
This is a reply to Ivor, taking our “cause” discussion away from Monday message and placing it here.
The word “reason” is unfortunately an ambiguous term. “Reason” can mean “cause” or something approximating it. “Reason” can also mean the processes of reasoning. “Reasons” can even mean explanations or even mere rationalisations. The Stanford Encyclopedia of Philosophy seems to use “reason” as at least an approximate synonym for “cause” in this definition.
“The Principle of Sufficient Reason is a powerful and controversial philosophical principle stipulating that everything must have a reason or cause.”
It continues a little later to say:
“If you accept the Principle of Sufficient Reason (= PSR), you will require an explanation for any fact, or in other words, you will reject the possibility of brute, or unexplainable, facts.”
Your overall point of view places you in the philosophical camp which accepts the Principle of Sufficient Reason at least for physical objects or processes. “There is no physical object or process that does not have a physical cause…” You also state “Universes can exist without “reason” but not without a physical cause.” But what is the physical cause of the Universe? Is it the physical cause of itself? This is a circular logic fallacy or problem. Is another Universe or another Universe-causing cause (in both cases physical) the cause of this physical Universe? What causes the other Universe or what causes the Universe-causing cause? This is an infinite regress fallacy or problem.
When you state “There is no physical object or process that does not have a physical cause…” you leave open the question of whether you are a kind of dualist (there is physical and non-physical “substance”) or whether you are a monist physicalist (there is only physical substance). Therefore you have left open (so far in this discussion) the issue of whether uncaused causes might exist outside the physical, material or corporeal (Descartes’s Res Extensa). Descartes postulated two other substances namely Res Cogitans (Mind) and God.
I don’t agree with Descartes. I postulate (in this Universe which is as far as we can perceive or detect with instruments) that there is only one overall “substance”. It is “matter” or “stuff” or “substance” for want a better word but it actually comprises both processes and the field of action for the processes (the space-time manifold). These exist together and in relation to each other and only exist in that fashion. What they are “in themselves” is not examinable. It may even be that “existence in itself” of components of the Universe is nonsensical. Only the composite exists. So I am “physical monist”. But at this level the word “physical” loses meaning if there is nothing non-physical to contrast it to. So strictly I am not a “physical monist” but simply an “existence monist”. The Universe to me is one all-connected existent. Everything is connected and related. Things or processes or phenomena may be either of distantly connected and related or closely connected and related or anything in between. To state that something is “all-connected” is not to state or imply that it is undifferentiated. Indeed connection implies differentiation. In addition the basic “things” or “processes” simply do not and can not exist without each other. At least I contend this. The space-time manifold cannot exist without what we call matter and matter cannot exist except as a thing or rather a process in space-time.
I do hold there is no explanation for this state of affairs or no cause if we will. It simply is. It simply exists. Existence (in total as all existence) is a brute fact. All we can do is discern connections or correlations within existence and pragmatically manipulate some processes to continue our existence. Notions of simplistic causation, rather than complex interconnection and interaction, assist us in physics and pragmatics to some extent. Notions of simplistic causation, rather than complex interconnection and interaction, do not assist us in political economy. Simple classical materialism (like classical physics) is not going to assist us to determine “the laws of motion” of political economy. Complex systems theory is more promising in this regard. The “laws of motion” will be found to include (I assert) issues of indeterminism, chaos and complex systems interaction involving equilibria and disequilibria. That’s a short screed on it.
@Ikonoclast
Anything that is caused has a “sufficient reason”, but not a metaphysical “sufficient reason”.
@Ivor
You seem to think you don’t have a metaphysical position (in the philosophical sense). A metaphysical position is not necessarily that there is a God or gods or immaterial spirits or immaterial substances. It could also be, for example, that there is consciousness and matter of different subtstances or that there is only matter or more precisely only a physical Universe and that consciousness supervenes on the physical or is emergent. These are all metaphysical positions. These function, in each case, as an priori justification for a subsequent thought-system. The a priori justification can never be proved. It can be supported well or badly, it can be demonstrated to be plausible or implausible, it can be demonstrated to lead to consistent or inconsistent results. But it cannot be proven. Technically it probably can’t even be refuted but it may be possible to get very close to a refutation of a very poor a priori justification.
Then what use is even a good metaphysical a priori justification and its ensuing philosophical system? The bottom line for modern scientific pragmatists is that it could lead to a string of testable hypotheses and better enable us to link empirical phenomena.
@Ikonoclast
Those are not metaphysical. They certainly lead to thoughts and they can be tested.
Any such thoughts can be corrected or falsified by tests and science.