A question for our Marxists - Page 6 - Politics Forum.org | PoFo

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#15171497
@blackjack21 wrote:
Which, of course, isn't happening at all. In fact, Colorado's election laws are stricter than the new ones in Georgia.

The bigger potential for trouble is when they take away the stimulus money. Look at the recent jobs report. They expected many, many more jobs than they got. GDP is booming. So why a weak jobs report? People are being paid not to work; that is, they will have less income if they go to work than if they remain on the covid-enhanced unemployment benefits and stimulus.


That is not correct BJ. Georgia is strict and Colorado has a lot of people with mail-in ballots for a very long time. I only vote mostly mail-in when I lived in Colorado. Now I vote via VoteFromAbroad.org using civilian overseas and military personnel codes for that. You can do it via the Election Commission. Gloria La Riva was on the ballot for 15 states of the USA as a presidential candidate. I agree with her policies 80% of the time. So I voted for her. She did pretty well for a relative unknown.

Both of your posits are incorrect.

Number 1 that Georgia is less strict than Colorado in voting conveniences and voting laws and making it easy for voters to vote? No, incorrect BJ.



You are not delving into why a lot of people can't really go back to work until the Child Care issue and the get the kids back to school full time soon. Also, it is not about the greatest thing.



Millions lose their jobs and the connection of employment and health care insurance:



Go back to work, not have anyone watching the kids on a TV virtual school, and no health coverage. No, they are coming to Mexico to save. The reasons is lack of universal health care coverage and child care and so on. Not lazy asses who don't want to work and live on the big ass $600 bucks a week on unemployment insurance. They never pay full salary on anyone.

Your theories are not valid.
#15171503
blackjack21 wrote:Exactly. That's why it crops up in places like Venezuela from people on the outskirts who are poor and desperate. Yet, Marxism can take a resource rich country like Venezuela and make it poor.

I would suggest reading up a little on the history of Venezuela and who actually benefited from its oil wealth in the days before Chavez. Hint: it wasn't the Venezuelan people.

blackjack21 wrote:After "Marxism has never been tried", this is the other main excuse for the failure of Marxism.

The only people who seriously advance the claim that "Marxism has never been tried" are liberal idealists, many of whom have rather paternalistic "white saviour" attitudes toward the Third World. This is also why you get socialists in the west who are absolutely determined to disavow modern China despite its obvious successes in many areas.

As for the other "excuse", if you think socialist projects haven't come under constant attack by the capitalist countries almost everywhere they have emerged, I don't really know what to tell you. Your own country is still imposing a Cold War-era embargo on tiny Cuba, which as far as I can tell, has your wholehearted support. Lol.
#15171505
Heisenberg wrote:

The only people who seriously advance the claim that "Marxism has never been tried" are liberal idealists



While there is some truth to that, what Marx wanted to see an economy that benefited the people. What he saw around him was pretty horrifying.

While things do need to get better, the horror show of that era is largely gone. You see, other economists of that era, including Adam Smith, felt there was a need for reform. And that did happen, although not because of economists. It definitely didn't happen the way Marx thought it would, but name a scientist from a couple hundred years ago whose ideas haven't been reworked. Time moves on.

Lastly, mercantilism gave way to capitalism, which will one day give way to something else, hopefully better.
#15171511
@late wrote:
While there is some truth to that, what Marx wanted to see an economy that benefited the people. What he saw around him was pretty horrifying.

While things do need to get better, the horror show of that era is largely gone. You see, other economists of that era, including Adam Smith, felt there was a need for reform. And that did happen, although not because of economists. It definitely didn't happen the way Marx thought it would, but name a scientist from a couple hundred years ago whose ideas haven't been reworked. Time moves on.

Lastly, mercantilism gave way to capitalism, which will one day give way to something else, hopefully better.


Hopefully better is the key phrase there Late.

Things change according to the criteria of human practice and to historical conditions and the need for adapting to whatever changes that makes the old system break down.

So far, people are demanding more from governments. Not less and just dissolve them and everyone just work and don't ask for government run services. That means that most people who have a need for a government service would rather it still exists than live with being paid very little and living with no health insurance access, no real cost effectiveness for college tuition, and no infrastructure. No one likes pot holes never being fixed, dead roadkill being left to rot on the roads, no public restrooms being stocked and cleaned, no public spaces being kept up or parks, rec centers and the list is endless of government funded services.

In fact, public schools and the reality that their children eat breakfast, lunch, and dinner there, and that libraries with air conditioning and materials to rent out for free, and public museums, and art venues, etc to be defunded and only funding private things no one can afford to pay for? Is not popular. Or just say no to social security. Don't accept the check and you eighty-year-old man or woman who worked for 50 years and retired? Get your lazy old self back to work full time at Amazon.com chucking orders into piles on a clock.

No one is going to be backing that far-Right piece of shit system. They are delegated to taking over a party on the edge of imploding on itself. They think that by radicalizing the electorate for far-right schemes that the people love it because they vote Republican even though the policies these radical types on the far right wind up shooting the vast majority of their supporters in the foot and the leg and in the head.

Everyone is vulnerable if they are not mega-rich and mega-protected in this system. If you know you can't afford to stop working and you need to move out of state to save on taxes because you need the money for when you retire? You are vulnerable. And should be advocating for a more socialist economy. If you don't? Don't complain if the capitalist nightmare you advocated for winds up making you their next victim in a financial fraud scheme and favoring the uber-wealthy over your group's tax bracket. Ignorance is not bliss with tax laws and codes.



That is all they can do Late.
#15171519
late wrote:While there is some truth to that, what Marx wanted to see an economy that benefited the people. What he saw around him was pretty horrifying.

While things do need to get better, the horror show of that era is largely gone. You see, other economists of that era, including Adam Smith, felt there was a need for reform. And that did happen, although not because of economists. It definitely didn't happen the way Marx thought it would, but name a scientist from a couple hundred years ago whose ideas haven't been reworked. Time moves on.

Lastly, mercantilism gave way to capitalism, which will one day give way to something else, hopefully better.

Despite all the inequality this is the most prosperous time in world history. That poor people can get a check, housing, and food from the government without having to work is a first.

The problem with socialists and those in the extreme left is that they paint a terrible picture that is always compared to an utopia that has never existed. All they need to do is compare to the not so distant pass and see the enormous progress. The more progress we see the greater the despair, it is a pathological state of mind.

Marx was correct in his analysis of capitalism, but he made one fatal error. Marx never understood the human condition. He assumed humans could be molded by the environment and hence I suspect he felt that individualism could be erased by an authoritarian government.

IN any event, the end result of capitalism is socialism and that happens when we reach a point of redundant wealth. This will happen naturally and not by a revolution.
#15171526
late wrote:We were on the gold standard back then. Which means we would have had to get the money to buy slaves somewhere. Because the economy was growing rapidly, and we were on the gold standard, we had recessions every few years because we ran out of money...

It's called national debt.

late wrote:And if there had been more money (like when the Gold Rush happened), the economy would have sucked it up like rain in the desert.

Rain in the desert usually results in flash floods.

late wrote:So where would the government get hundreds of billions (in 2021 dollars) to buy slaves? The short answer is nowhere.

There were about 4M slaves in the US in 1861, and they were worth about $1300 on average. That's about $5.2B.

late wrote:The longer answer is that Congress wouldn't have touched that with a quadrillion foot pole. The slave states would have rejected the proposal, and prob gone to war over it, because that would have ended their economy. I also wonder what the Supreme Court would have had to say about it, but that's a bit above my pay grade.

America had a very limited government at the time. There was no income tax. In fact, an income tax would be unconstitutional. That's why we have a 16th Amendment.

late wrote:You write fiction, it's stupid, it's obnoxious, and it's you.

The federal government borrowed over $2B to fight the Civil War--more debt than it had ever incurred. The point is that there were other alternatives, but people didn't want to pay. That's why it ended in war. In fact, Lincoln didn't pay monies owed to the Sioux Indians, causing them to revolt and Lincoln putting them down--holding the largest mass hangings in US history.

Tainari88 wrote:Number 1 that Georgia is less strict than Colorado in voting conveniences and voting laws and making it easy for voters to vote? No, incorrect BJ.

You stated something very different: that Georgia was going to have voting machines that discount minority votes. There is absolutely no evidence of that at all. The big brouhaha is that they require ID now, which is common in almost every democracy in the world--except in the United States, because Democrats insist that black people don't have IDs or drivers licenses, which is absurd.

Tainari88 wrote:You are not delving into why a lot of people can't really go back to work until the Child Care issue and the get the kids back to school full time soon.

American children take summers off to this day; although, nobody really lives on farms anymore. This is a problem caused by Democrats and their labor unions. Children haven't been a big infection vector of coronavirus.

Tainari88 wrote:Millions lose their jobs and the connection of employment and health care insurance:

They can get COBRA and they can get ObamaCare. So, you're saying ObamaCare isn't affordable? Poor people can't get on Medicaid? Or are you saying county hospitals (government owned and run healthcare) is no good? I thought Democrats said they solved all these problems for us.

Tainari88 wrote:No, they are coming to Mexico to save.

Americans are migrating to Mexico now? Is that the big story? Or are you talking about medical tourism?

Heisenberg wrote:I would suggest reading up a little on the history of Venezuela and who actually benefited from its oil wealth in the days before Chavez. Hint: it wasn't the Venezuelan people.

PDVSA was established in 1976 as a state-owned oil and gas firm. All oil firms in Venezuela operated under PDVSA's direction. They did fine with existing wells, but they didn't have newer technology. They didn't invest in it. They used most of the profits for social programs. This is what I mean about some of the problems of socialism. To increase output, they invited foreign oil giants back in to help them. PDVSA was able to maximize profits, but the foreign firms were lightly taxed. So it's not a story of exploitation by foreign firms as such. Remember, oil hit as low as $12 per barrel in the 1990s.

Chavez came into power in 1998. He absolutely bilked PDVSA and riddled it with political loyalists. So almost nothing went in to new production, plant or equipment, and everything into social programs. That worked in the mid-2000s with oil hitting as high as $147 per barrel--even with locking out all the workers who weren't loyal Chavistas. When oil prices fell, the entire thing fell to pieces. This is why welfare states have income taxes on all sources of income, not just a few cash cow commodities. It still has boom bust cycles, but nothing like the collapse of Venezuela.

Heisenberg wrote:As for the other "excuse", if you think socialist projects haven't come under constant attack by the capitalist countries almost everywhere they have emerged, I don't really know what to tell you. Your own country is still imposing a Cold War-era embargo on tiny Cuba, which as far as I can tell, has your wholehearted support. Lol.

It's a trade embargo. My point is that socialism tends to fail, but always blames it on someone else and not the problems inherent in socialism. Human nature doesn't change fundamentally because of a political system. Union workers are as greedy as "the rich." Back in the UK, you saw that in the Thatcher years with the coal miner strike bringing the entire country to its knees.

See the interesting thing is that Chavez and Thatcher faced the same thing--a nationalized business with striking workers. Chavez fired everyone who wasn't a political loyalist. Thatcher kept as many people working and stockpiled coal. Yet, both had to fight unions in state-run businesses.

Tainari88 wrote:No one is going to be backing that far-Right piece of shit system.

They invariably do when the ravages of socialism hit them. We have lots of people in IT who used to live under Soviet communism. They have stories to tell.

Tainari88 wrote: If you know you can't afford to stop working and you need to move out of state to save on taxes because you need the money for when you retire? You are vulnerable. And should be advocating for a more socialist economy.

The taxes are for government-run operations. Britain's national coal board was getting subsidies. The best of socialism is from the fascist model, but we see how that worked in mixed economies of the 20th Century along with the non-democratic ones like Germany, Spain and Italy.

Tainari88 wrote:Don't complain if the capitalist nightmare you advocated for winds up making you their next victim in a financial fraud scheme and favoring the uber-wealthy over your group's tax bracket.

Financial fraud isn't capitalism. It's crime. All societies have fraud, impersonation, cheats, and so forth. Why you think this is unique to capitalism, but somehow doesn't happen in socialist societies because Marx failed to write that part down is mystifying. What happened when oil majors wouldn't sell majority interest in their concessions to PDVSA under Chavez? Venezuela expropriated them. That is, they stole the concessions.

Tainari88 wrote:Ignorance is not bliss with tax laws and codes.

Why do you think it would be bliss with socialist tax laws and codes? You can't run major societies without law.

Julian658 wrote:Despite all the inequality this is the most prosperous time in world history.

That is quite true. That's why I say inequality isn't a normative bad thing. Inequality in one respect could be seen as an indicator of progress. We shouldn't oppose inequality for its own sake. Cultural Marxism is essentially looking to find social inequalities and raise hell in perpetuity. Yet, it leads to really counter-intuitive results too: like Bruce Jenner running as a Republican for Governor of California as transgender "Caitlyn Jenner" and extolling values that are more conservative than typical Republicans these days while utterly horrifying the Democrats that he doesn't seem to feel any sense of allegiance or fealty to the Democrats for their advocacy of transgenderism.

Julian658 wrote:The problem with socialists and those in the extreme left is that they paint a terrible picture that is always compared to an utopia that has never existed.

Well, I think the bigger problem is the dishonesty of those extolling socialism with the performance of government-run systems. Britain had government-run coal. How did that work out? America had a more fascist style of quasi-public monopolies like AT&T. Those tended to work better. America has a lot of ESOPs. High tech businesses work that way. However, you need capital markets if the business is capital intensive. So you can't just say, "ownership by the workers" because the workers cannot afford to acquire all the resources they need to build a hospital for example.

Julian658 wrote:All they need to do is compare to the not so distant pass and see the enormous progress.

Indeed. However, honesty also plays a role. Did Christopher Columbus say, "I'm not going to sail West unless I have health care insurance"? No. People absorbed much more risk in the past, and they are very capable of it. Most people could dedicate much more of their time to study, but feel the need to be directed by a college or university--which will over charge them and waste their time on things like "woke" politics.

Julian658 wrote:Marx never understood the human condition. He assumed humans could be molded by the environment and hence I suspect he felt that individualism could be erased by an authoritarian government.

An excellent point, because this is the same problematic assumption of people who extol Marxism. These are the missing pieces in microeconomics. Everyone who goes through b-school gets taught about supply and demand, the shutdown point, or profit maximization (MR = MC). Yet, there is no similar explanation of labor seeking to maximize wages and the effects if they are allowed to exploit a system--like my friend with a master's degree in psychology making $100k+ emptying garbage cans. BART is not the bargain that the Los Angeles transit system is...

Julian658 wrote:IN any event, the end result of capitalism is socialism and that happens when we reach a point of redundant wealth.

So you believe in this inevitability theory too? Redundant wealth is governed by the law of marginal utility. Marginal utility goes negative the more you consume something you don't need. It leads to waste and decay, not socialism.

I work in open source software, and it's a really interesting area because we give the product away for free but we charge for support. The tension in our business is that demand is perfectly inelastic on the basis of price for something that is given away free. Yet, there are other forms of elasticity not really taught much in b-schools. I prefer to think of price as an impediment to demand, and that we should think of it a bit more abstractly as "impedance elasticity of demand."

The harder a product is to use, the less usable it becomes. For example, Facebook is free to you. Yet, they've spent hundreds of millions if not billions on user interface design. Staggering amounts of money... all so that you will use their product, give them copious amounts of information about you and thereby see their eerily very targeted advertisements. It's pretty incredible when you think about it.

A linux distribution like Fedora or Ubuntu already has most of what you need for computing--free browsers, word processors, spreadsheets, presentation programs, video editors, etc. I understand people like Mac or PCs better. However, I don't think they are much more advanced than open source anymore--with the possible exception of Adobe's media products (Photoshop, Illustrator, InDesign, etc are superior to any equivalent open source solution). I do think Hell, you won't get AutoCad, but you can even get free CAD programs in open source too, and they are every bit as good as the ones you'd pay top dollar for in the early 1990s.

So here you do have something that is community owned and free to everyone. Yet, people CHOOSE to buy macs or PCs with Windows installed. Why? People do not naturally choose the cheaper option.

I think Tainari88 believes that her brand of socialism would work great, but I don't think she'd like living in Mao's China wearing black pajamas and having only a bicycle for transportation.
#15171531
Rugoz wrote:If the capitalist owned the workers, no doubt wages would be at subsistence level.


I fucked up there, and you could have said most iterations of communist societies amounted to the state owning the workers. But, America is sorta like that too, with our social security numbers and our global taxes. I know you aren't American though. But it is sorta a framework for me, mostly because I'm American, but also because it's the most dominant economics force.

But it's not the worker's cost to live, or rather the cost to produce and maintain him (i.e. the "full cost of the worker minus the surplus"), that determines the wage rate. The worker is not like any other input or machinery produced in a capitalist fashion. There's a (more or less) fixed supply of workers and the capitalists have to compete for their labor.

The surplus army of the unemployed doesn't really exist. The overwhelming majority of workers wouldn't work for a subsistence wage, even one that satsifies today's standards of subsistence (which is relative to the overall level of wages). Instead real wages have been rising and rising for ages. If the subsistence wage theory were true, wages would have remained at 19th century level, maybe with a small plus for better eduction and health care.

In the US, wages have been stagnant for going on 50 years. In America, the Federal Reserve targets the preferred unemployment rate. What the Fed calls full employment is probably something between 3 and 4 percent. They don't want unemployment to get too high, lest that army of unemployed get upity.

They don't want the army of unemployed to get too low. They say it is to control inflation, there is an aspect of truth to it, but it is because they want to maintain the surplus army of the unemployed, which Marx geniusly delineated.

I don't know enough about the Swiss economy, so it is hard for me to comment on how the scene is there.

I will reiterate one thing. Marx was an economist. He used economics models. Economics models are not policy formulations.

This is something which has been misunderstood by as many Marxists at least as non-Marxists, is my guess.

I will say though, Lenin was a good economist and a good Marxist. He died early, partly because he had been shot in an assassination attempt. And Stalin was a fucking madman, who nevertheless was indispensable in defeating Nazi Germany. That seems Faustian or something.
#15171533
blackjack21 wrote:
It's called national debt.


Rain in the desert usually results in flash floods.


There were about 4M slaves in the US in 1861, and they were worth about $1300 on average. That's about $5.2B.


America had a very limited government at the time. There was no income tax. In fact, an income tax would be unconstitutional. That's why we have a 16th Amendment.




"As we will explain below, at the time the South seceded from the Union, the purchase of a single slave represented as much as $150,000 and more in today's prices. This was twice the average of 14 years earlier...

Total slave wealth was immense. Figure 7 shows the aggregate value of slaves adjusted to today's prices measured using the relative share of GDP. While it varies with the price of slaves over the period, it is never less than six trillion 2016 dollars and, at the time of Emancipation, was close to thirteen trillion 2016 dollars."
https://www.measuringworth.com/slavery.php

Congress back then was very reluctant to take on debt when they didn't absolutely have to. The idea that they would have, or even could have, bought all the slaves is ridiculous. It's also something the South would never have accepted.

Yeah, I know there was no income tax back then, which is a problem for your case, not mine.
#15171554
Pants-of-dog wrote:We honestly have no idea about democratic socialism since the capitalists come with guns and violence to destroy any fledgling movement.

So, it is impossible for you to make this comparison.

I stated social democracy (nordic countries etc) not democratic socialism.
#15171578
blackjack21 wrote:My point is that socialism tends to fail, but always blames it on someone else and not the problems inherent in socialism. Human nature doesn't change fundamentally because of a political system.

This is honestly the laziest, most boring "critique" of socialism ever - and yet it's always presented as some profound insight.

Socialism took the USSR from a semi-agrarian backwater to a nuclear armed, space-faring superpower in less than 50 years, including the unprecedented devastation of WW2.

Yes, the USSR ultimately broke up, for a whole range of reasons. To look at its entire 74-year history and come away with no lessons beyond "socialism doesn't work because of human nature" is completely asinine. It's like saying the end of the British Empire means that capitalism doesn't work.
#15171584
Heisenberg wrote:Socialism took the USSR from a semi-agrarian backwater to a nuclear armed, space-faring superpower in less than 50 years, including the unprecedented devastation of WW2.

That's giving way too much credit to socialism. Russia already had great universities and scientists. A lot of what happened under socialism was importing production technologies developed in capitalist and fascist economies to reform the Russian economy. Russia was already very big before 1917 and had a world beating culture. They acquired Vladivostok from China and fought a war with Japan over it. Even the Trans-Siberian railroad was completed before 1917.

Russia had great musicians, authors and scientists well before the socialists came along. Borodin, Mussorgsky, Rimsky-Korsakov, Rachmaninoff, Tchaikovsky, etc. In fact, Rachmaninoff and Stravinsky fled Soviet communism and became Americans. Pushkin, Tolstoy, and Gogol were all pre-socialist. They had great writers who became socialists like Dostoyevsky. Under the Soviet Union, anti-communist writers like Solzhenitsyn are the ones considered great. And others who became Americans, like Vladimir Nabokov. Borodin wasn't just a musician, he was also a scientist who discovered the Aldol reaction. Lamonosov was a writer, and deduced the atmosphere of Venus, and the law of mass conservation. Mendeleyev created the periodic table and was the first to predict undiscovered elements. Lobachevsky created a viable alternative to Euclidean geometry. Stoletov developed the first photo-electric element converting photons to electricity. Alexander Popov was instrumental in radio. Ivan Pavlov was the first Russian to receive a Nobel prize in 1904, and well known for his work on classical conditioning. Markov was known for the stochastic process. Zworykin also fled the Soviets to become an American. Russia wasn't just some hapless, helpless place that needed to be saved by socialism. It was already the largest country in the world and had many great people--it was its feudal system that needed undoing because they had serfs working in factories. It was more or less the same rationale as for the US Civil War. The UK was getting rid of indentured servitude and emancipating women at around the same time as the Russian revolution.

Heisenberg wrote:Yes, the USSR ultimately broke up, for a whole range of reasons. To look at its entire 74-year history and come away with no lessons beyond "socialism doesn't work because of human nature" is completely asinine. It's like saying the end of the British Empire means that capitalism doesn't work.

Both empires came apart because of human nature. Multicultural empires are very hard to hold together, because the people within them are so different. That's why I think the American embrace of multiculturalism over the last 30 years will prove to be a tragic mistake.

Socialism's problems aren't simply about multiculturalism. Socialism does not seek the most efficient allocation of resources, which is why it compares unfavorably to capitalism over time--especially when new innovations arise. Socialism seeks a more egalitarian distribution of resources, and doesn't make a clear distinction between resources for production versus consumption. This is particularly appealing when the lower classes are stressed for basic necessities. In a country like the US, where poor people are fat and have cell phones, the appeal is largely lost.

I think some aspects of socialism could work if it adopted some of the principles of capitalism, like efficient allocation of resources. It's precisely that efficiency that makes capitalists (not crony capitalists) eschew political and economic corruption. It's in that mode of "greed", as Tainari88 might put it, that capitalism shines--and that tends to happen with competition which also seems to get lost in socialist societies as unnecessary duplication, unpleasantness, etc. Socialists seem to find efficiency in state-run monopolies. As I've noted, many of those types of combines have collapsed over time in both socialist and capitalist societies. Yet, for some reason, these structures have a very strong appeal to some people. The greed of the common worker is part of human nature too. Paying people $100k+ to empty garbage cans is what you get, and that is a political patronage job where money funnels back into labor unions and to one political party.

I am not a fan of crony capitalism either, which is why I left the Republicans and why I am not a fan of Bush, Romney, McCain, etc. American crony capitalists also cripple the efficient allocation of resources and competition in favor of profit maximization. That's why US internet pricing is so expensive. It's why US cell phones were so primitive compared to Europe or Japan before smart phones. It's why Google and social media companies have seen their apogee and will probably start to wane as powerful forces. Freedom, competition and efficiency will always beat tyranny, monopoly and inefficiency (often basic corruption).
#15171600
wat0n wrote:Is he, though? As you say below it would seem Klinman is actually relaxing some of Okishio's assumptions. Up to what extent would this consist in an immanent critique?

I had the TSSI in mind when conceding Okishio's not necessarily right, but only stating that the big result of the tendency of the profit rate to fall is in fact dependent on several assumptions.

Well it doesn't introduce another assumption as much as pose the dilemma that one of the assumptions of the model is unexplained and inadequate. The assertion by Kliman is that "if profit rates are equalized across sectors, the level of the uniform profit rate is uniquely determined by physical coefficients." this he challenges.
"Yet, contrary to the apparent belief of the proponents of the Okishio theorem (and most readers of Dmitriev and Sraffa), it is simply not true that the magnitude of the uniform profit rate is uniquely determined by physical input/output coefficients."
As you can see here, there is an assumption which is being built upon. You might consider this narrowly as an expanding of the assumptions, and it certainly does as Okishio's theorem defenders are not pushing it beyond this apparently.
But the point is that there is a logical connection between the limitation of the assumption and some truth which is provable. The point is that an internal criticism begins with the premises of another school of thought but shows how they fall into contradiction. The very focus of Marxist analysis is to reveal the limits upon which something is true or not. Because truth isn't about universal truth alone, but often many things are true but within qualified limits, they fall into absurdity when they become to generalized. There is such a tendency upon new scientific discoveries like with Pavlov's generalization of the reflex with the bell and the salivating dog and suddenly everything is explained by reflexes. Except not everything is so directly synonymous with such conditioned reflexes. So they fall into error.

And that's fine that you are emphasizing that there are several assumptions in such an interpretation. Marx is often criticized on many counts for not explicitly laying out the very methods in which he analyzes things and so people had to investigate a great deal to even come up with competing interpretations of what is consistent with Marx and what they think is indeed correct (do they agree with Marx?).


Well, my understanding is that it was the standard interpretation of Marxian economics when Okishio came up with his theorem in 1961 (TSSI is from the 1980s). One may actually wonder up to what extent is either interpretation represents Marx's original claims better.

Indeed, the idea of simply finding the true interpretation would be as fruitless as the final word on a religious text. Meaning isn't entirely contained within symbols/words but is always related to the broader world, which changes.
However, the emphasis on internal consistency does have some significance, that it is somewhat damning to find contradictory claims and there needs to be a way to resolve them. Kliman only goes as far as to defend Marx as internally consistent and when interpreted as such, some criticisms fall away as not properly criticizing their target.
Think of how an theist might criticize evolutionary theory without actually having learned what it is, they miss the mark and if you have some knowledge about it you can clear see where. Just as some scientists are philosophically inept where they try to use empirical reasoning and so on to contend with a theological issue on the existence of God. They talk past one another when they're not in some mutual understanding.


Well, if you look at one of the responses to Okishio's Theorem is that indeed the result goes away if you keep the share of labor in income constant (this implies real wages can perfectly go up). Likewise, I would also not be sure that the result holds with any production function - maybe you can reproduce Marxian claims with others.

I would say though that assumptions like constant labor power or a constant rate of surplus value are far from a foregone conclusion either. In the real world, there is a constant effort to increase the former and I don't really see any reason to assume the latter would be constant, not even in the long run. I can imagine technical developments may constantly increase the rate of surplus value.

At last, I don't see Okishio's Theorem as necessarily saying Marx was being internally inconsistent. Instead, I see it as showing his conclusions are sensitive to assumptions. That is, his assumptions are actually having a stronger role in his conclusions than he was acknowledging.

I think one concern is the idea is that machines may improve physical production or the number of use-values, but that the issue of profit is measured in exchange values and real wages is based on the comparison of what commodities i.e. goods and services which can be bought. Michael Roberts is critical of this being possible to always make such a rigorous comparison on the basis that use-value does not have a shared basis for comparison. The use-value of a car is not comparable to that of a buying a book to read, and this is exacerbated across time where there are entirely new commodities and needs for the modern person which simply did not exist in the past. How doe one compares the commodity of an old rotary telephone compared to an iPhone?
Spoiler: show
https://critiqueofcrisistheory.wordpress.com/responses-to-readers-austrian-economics-versus-marxism/andrew-kliman-and-the-neo-ricardian-attack-on-marxism-pt-2/
The fatal flaw in the Okishio theorem

Okishio was a rigorous mathematical economist. How do we in a mathematically rigorous way actually compare the real wage in one period with the real wage in another period? Before we can compare the real wage at two different points in the development of capitalism, we have to render the two real wages earned by our workers in the two different periods quantitatively comparable. That is we have to render the use values of the commodities that workers buy with their wages quantitatively comparable. But before we can do this, we have to render the use values of the commodities the workers consume qualitatively identical. And here the Okishio theorem breaks down.

Back to the corn models

One way to render real wages qualitatively identical and therefore quantitatively comparable is to assume that real wages consist of a single commodity—such as corn of a given quality. Or alternately that real wages consist of commodities whose use values never change and remain in exactly the same proportion to one another. Both are fantastic assumptions that are completely divorced from reality. Therefore, there is no way to apply the Okishio theorem to real-world capitalism. It is only applicable in a “neo-Ricardian” dreamscape.

In the real world, there is no way to compare quantitatively the real wage at different times in the history of capitalist production. As the organic composition of capital rises and labor productivity rises with it, the commodities that the workers consume change qualitatively and not simply quantitatively. Therefore when applied to real-world capitalism, the Okishio theorem is mathematically undefined. As far as the logic of his math is concerned, Okishio might as well have divided by zero.

The comparisons we cannot make

For example, suppose we wanted to calculate the rate of profit today compared with the rate of profit in the epoch of Marx. If we adopt Okishio’s approach, we have to compare the real wage earned let’s say by a worker in London in 1860 and a worker in 2010. We have to make a quantitative comparison of the use values that workers buy in London in the year 2010 with the use values of the commodities that the workers who lived in London bought with their wages in 1860.

Today, except for maybe the worst paid workers in third world countries, workers have to purchase electricity for electric lighting, for example, and also acquire cheap radios, telephones and televisions. Better-paid workers—workers who live in the imperialist countries like Britain, for example—purchase many other commodities as well. For example, they buy automobiles to get to work, electric-powered clothes dryers and dishwashers, vacuum cleaners and computers. None of these use values even existed in 1860.

And the problem doesn’t end here. The kind of telephone a worker might have owned not in the time of Marx—there weren’t any telephones in the 1860s—but in the 1950s is quite different than the cell phones that many workers own today. How many 1950s dial phones equal a cell phone of today? One brand of cell phone has been advertising that it comes with James Cameron’s Avatar preloaded. What movies came preloaded on 1950s dial phones? Exactly how many black and white TVs from the 1950s equal in use value terms a modern color TV made in 2010? And as they become cheaper, exactly how many flat screen TVs equal in use value terms a now “old-fashioned” cathode-ray tube TV, not in terms of price but in terms of use values?

Even the food we buy today in 2010 London is far from being qualitatively identical to the food that a worker might have bought when Marx was writing “Capital” in 1860s London. Any attempt to make a quantitative comparison of the use values of the commodities that make up the workers’ “real wage” in say London in 1860 with London in 2010 in a mathematically rigorous way is hopeless.

As soon as you start to talk about real wages, you are calculating in physical terms. When analyzing the capitalist economy based on profit, which is measured in money—exchange value—terms, any attempt to explain it by calculating in physical terms, Kliman correctly points out, ends in a blind alley.

And so it does suggest to me that Okishio's theorem is an example of physicalism in emphasizing real wages.
https://kapitalism101.wordpress.com/2008/10/16/falling-rate-of-profit/
3. Capitalist do not operate from a conscious labor theory of value. To them, increased physical output means increased profits. This confusion of physical output with value is referred to as “physicalism”. It is the same theoretical error that confuses many of the critics of the falling rate of profit like Nobuo Okishio and John Roemer. Both capitalists and their bourgeois theorists are stuck in a theoretical quagmire where they think the value of commodities stays the same regardless of how efficient the production process is, while it is quite obvious to any lay observer that the value of commodities is constantly decreasing with rising productivity.

https://kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/
We use machines to make our labor more productive. Productivity is a measure of the amount of use-value created in a span of time. Since, for Marx, value is determined by labor time an increase in productivity (in use-values) does not create a corresponding increase in value. The same amount of value is created, just spread out over a larger quantity of use-values. This difference between use-value production and value production is one of the hallmarks of Marx’s theory of value. It allows Marx to explain many of the most important contradictions at the heart of capitalism: the domination of living labor by dead labor, the tendency of the rate of profit to fall, ETC. This also explains why unit prices tend to fall as productivity rises. If we were to argue, contrary to Marx, that machines create value then we wind up with a theory in which use-value production is the same as value production. An increase in productivity would mean an increase in value-production. This results in a very different theoretical understanding of the economy. Such an understanding cannot derive any of the same contradictions that Marx’s theory does. There is no tendency for the profit rate to fall with rising productivity, living labor is not dominated by dead labor, profit doesn’t come from exploiting workers, and prices do not fall with rising productivity.

This at least is part of Michael Robert's criticism of the focus on real wages, that it's simply not an adequate measure, because profit isn't measuring use-value and this seems to confuse the very contradictory nature of commodities as simultaneously use-values and exchange values.

But when considering increases in physical production, the early innovater still get to sell their product at the same price as before, but their efficiency in physical productions creates a 'super-profit' because they're able to produce more physical output for less cost, but sell at the same price as before, resulting in a 'super profit'. But then the innovation becomes generalized across the competition and the price falls because productivity has increased, meaning less socially necessary labor is required to produce the commodity on the whole. Or simply put, you have the same amount of workers, but they're able to produce more within the same amount of hours of work. And it can be the case that value hasn't been expanded, rather you've spread the value across an even greater amount of commodities. More slices cut up from the 'value' pie.
Because you haven't extracted more value out of workers by having them work more hours or be paid less, you've simply increased physical production which outcompete other businesses, but the divide in the working day between labour power (wages) and labour performed hasn't changed.

Spoiler: show
https://critiqueofcrisistheory.wordpress.com/responses-to-readers-austrian-economics-versus-marxism/andrew-kliman-and-the-neo-ricardian-attack-on-marxism-pt-2/
An individual industrial capitalist might very well introduce a new method of production that increases the ratio of constant to variable capital—in everyday language introduce a labor-saving method—if it reduces the cost price—constant capital plus variable capital. That is, the capitalist will introduce the new labor-saving method only when the savings in the variable capital is greater than the increased cost of the constant capital—dead labor. This will mean that productivity of labor in our innovating capitalist’s factories, mines or fields will rise and the individual value of the commodity produced will fall.

This will mean that an hour of concrete labor preformed by the innovating capitalist’s workers now counts for a greater amount of abstract labor. This is true because our innovating capitalist only lowers the individual value of the commodity produced and not its social value. (3) But once the innovation becomes generalized, the social value of that type of commodity that our innovator produces will fall. Or what comes to exactly the same thing, an hour of concrete labor performed by the workers of our “innovating” capitalist will on average once again only represent an hour of abstract labor.

However, during the interval between the introduction of a new innovation by a particular capitalist and its generalization, our pioneering industrial capitalist is able to sell his or her commodities at a price well above the individual value—or individual price of production—though not above its social value—or social price of production. The difference between the price of production at which our “innovator” sells his or her commodity and the individual value represents a super-profit. This occurs every day in world capitalist competition.

However, once the innovation becomes generalized, the social value will fall, and sooner or later the price of the commodity—assuming the value of money remains unchanged—will also fall as market prices adjust to the new lower prices of production. Once prices have adapted to the new lower values and production prices of the commodity—which cannot happen without a competitive struggle, of course—and the rate of profit has again become equalized in all branches of industry—which also requires a competitive struggle—the general rate of profit will, all else remaining equal, be slightly lower than before.

Therefore, did our capitalist make a mistake in introducing the innovation? Not at all. For a transitional period—perhaps a prolonged transitional period—our innovating capitalist made a super-profit above and beyond the previous rate of profit. (4) Once production prices have adjusted to the new lower value of the commodity, a fellow capitalist in the same line of production who has not copied the innovation ends up with an even lower rate of profit and quite likely an outright loss. In the case of a loss, our laggard will lose all his or her capital sooner or later.

Therefore, the drive of every individual industrial capitalist to increase his or her particular rate of profit can very well lead to a fall in the rate of profit for all the contending capitalists. Unless our capitalists are able to organize a universal cartel that outlaws any innovation that increases the organic composition of capital—something the mutual antagonism among our competing capitalists renders impossible—there is no way to prevent a rise in the organic composition of capital. And this will mean— assuming the rate of surplus value remains unchanged and all else remaining equal as well—a fall in the rate of profit.

https://kapitalism101.wordpress.com/2008/10/16/falling-rate-of-profit/
1. We see the price of commodities fall all of the time due to increased efficiency. Notice the plummeting price of digital technologies, once adjusted for inflation. This means that increased productivity does not mean increased value. The same amount of workers are producing the same amount of value. This value is just spread out over more, cheaper commodities.

https://kapitalism101.wordpress.com/2010/09/21/law-of-value-6-socially-necessary-labor-time/
Physical vs. Value Productivity

A superficial look at the ACME TV factory might give one the impression that ACME is making more profit because they are creating more value. But this is not the case. The same amount of workers are doing the same amount of work as before. The same amount of labor time is being performed, spread out over a greater number of commodities. Thus the amount of value they create is not increasing merely because the physical output is increasing. It is extremely important to understand this difference between physical productivity and value productivity. As it becomes easier to make TVs their prices fall. Thus, just because we can make more of something doesn’t mean we have created more value. If other firms were to adopt technology similar to ACME’s we would see the SNLT of TVs fall to half of its former value and ACME’s super-profits would disappear.
...
SNLT and the Labor Process

This process goes on everyday in a capitalist society. We have an obsession with time and efficiency. Everything from the working day, to the motions of workers are timed and rationalized. From the moment the alarm clock rings you are checking train schedules, punching time cards, and working as efficiently as possible. There is an entire field of industrial engineering which is devoted to decreasing SNLT in society. Some of the most influential minds of the last century have been people like Henry Ford and Frederick Taylor who made substantial contributions to the reduction of SNLT, all in the quest for a super-profit.

This drive to produce a super-profit does not mean that less and less labor is happening in society. It means that the same amount of labor is producing more output. We are often told that machines will make life easier, reducing the need for work. But this has never been the case in a capitalist society. Machines just create more output per hour worked. Often times machines are used to get more work out of workers because the machine can dictate the pace and intensity of work. SNLT is a force that presses down upon us, disciplining our motions, driving us to produce value merely for the sake of producing value, rewarding us when we can produce above the average productivity and punishing us when we fall behind.



You may also wonder if Klinman is correctly interpreting Marx, too.

Indeed, it's not a foregone conclusion that he could have made some error. But it's not all that apparent based on feedback that he's necessarily and evidently wrong either. So even feeling that out has been hard as I am not familiar with much criticism of Kliman


It's possible, one may start from one school and end up agreeing with another.

Of course, different schools of thought are in some relation to one another based on the shared object of their consideration and many may cross the room. It's just not necessarily typical as it requires we invest enough time and effort with an open mind to the influence of what is initially an opposing viewpoint.
Human limitations making learning in-depth to know for ones self an arduous task.


Well, under that reasoning you could say the same about capital pretty much by definition. Am I correct?

That capital is producing the changes in raw materials into other more expensive commodities which can actualize their value on the market? This is vague because capital most certainly puts things into motion within the capitalist mode of production but it does not literally create things. In fact Marx's distinction between labor and labor power comes from his historical insight emphasizing how man has always laboured, but labour power as a commodity has not always existed.

Because for Marx, labour is the universal which underpins everything which is human, there would be no such things as a human being as we know it without consideration of the labor process underpinning the satisfaction of our needs, as well as their development.
http://d-scholarship.pitt.edu/10867/1/VWills_ETD_2011.pdf
The first premise of all human existence and, therefore, of all history, [is that humans] must be in a position to live in order to be able to "make history". But life involves before everything else eating and drinking, a habitation, clothing and many other things. The first historical act is thus the production of the means to satisfy these needs, the production of material life itself. And indeed this is an historical act, a fundamental condition of all history, which today, as thousands of years ago, must daily and hourly be fulfilled merely in order to sustain human life24.

Of which Marx would emphasize those who provided their own use-values and never turn their products of labor into commodities on a market.
http://www.abrahamlincolnonline.org/lincoln/speeches/fair.htm
They do not deny that there is, and probably always will be, a relation between labor and capital. The error, as they hold, is in assuming that the whole labor of the world exists within that relation. A few men own capital; and that few avoid labor themselves, and with their capital, hire, or buy, another few to labor for them. A large majority belong to neither class -- neither work for others, nor have others working for them. Even in all our slave States, except South Carolina, a majority of the whole people of all colors, are neither slaves nor masters. In these Free States, a large majority are neither hirers or hired. Men, with their families -- wives, sons and daughters -- work for themselves, on their farms, in their houses and in their shops, taking the whole product to themselves, and asking no favors of capital on the one hand, nor of hirelings or slaves on the other.

This is from a Speech by Lincoln which reflects a time with a lot of small farmers made up the U.S. and it reflects a point about how dominating the market can be in modern life when say there is an economic crisis but you have your own means of subsistence.

Then there are separate arguments as to how labor is the substance of value, it creates new value, and that it is pretty difficult to conceive of value ("natural price", not price) independent of labor.
https://kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/
Whether it is acquiring raw materials, molding them into a socially useful object, or social relations which make land more worthwhile acquiring and thus in higher demand. To which the idea is that labor clearly precedes capital, so the idea of somehow capital somehow being the essential thing would seem to universalize capitalist production and indifferent to qualitative differences where man clearly labours without a need for capital.

Indeed, and it's an extremely important point to consider. If you look carefully, there is a fairly standard interpretation of the neoclassical model precisely because of its mathematical formulation. Unfortunately, classical economists like Marx or Ricardo can be interpreted in different ways that can conceivably be all valid, and that's only because of the lack of a mathematical formulation. Even worse, someone like Okishio could come up with an idea that can be associated to different classical schools for that reason, since he did express it mathematically while the classical economists only used it occasionally as an aid. This also makes it easier to try to compare and relate schools to each other, since we can deal with what should be the most important differences, namely, differences in the assumptions they are making and how they arrive to their conclusions.

It's good to see even Marx himself realized a mathematical formulation of his theory was desirable.

Of course, using math has some entry costs (for starters, needing to actually learn math) and some concepts may not be easy to express mathematically. But then you could say the same applies to any language.

At last, there is the related yet different issue which is to consider the modeling and writing norms at the time the theory was postulated. For instance, if a contemporary mathematician cold read an original text from a 19th century mathematician he'd have trouble understanding it simply because modern day notation is different (arguably clearer), although once he got used to it he should be able to understand the message just fine. I actually find Marx's writing style to be fairly... Complicated in general, but you could argue that's simply because norms were different from our contemporary ones and the same holds for other writers from his time. Yet, that doesn't really help if you want to read him in the 21st century.

Math is a universal language as quantity is a prevalent concept and we've built up that concept into impressive means of analysis. Having a shared language as a basis for understanding and proofs is certainly important as I do think that is what makes comparisons more viable, of course it is insufficient also where there are different assumptions at play. Math being a kind of neutral tool, method, which can be appropriately used or not.
Indeed I do compare learning math to learning a language, you just got to get in and swim to pick it up. In fact, I'm hoping to learn a lot more math in part because I've been introduced to the sense of math having critical reasons behind procedures where as a lot of my education was the learning of procedure but not really an insight into why a lot of the time. So one can perform a math computation but not really understand its significance, I think this is what makes Math unappealing compared to a math geek who talks about the beauty of the connections and so on. A whole different experience of it.

I agree that there is sometimes a context or milieu that is missing when reading old texts that apparently were easy enough for others to read but are more cryptic from the modern view point. I have not dived in deep into Marx's text in par because some are collosal but at the same time I had spent a lot more time looking into Marxist theory so as to better approach him with some understanding rather than a cold read. Like yes you want to read the original text but it helpful to have someone lay out things for you so you can navigate it better.


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Rugoz wrote:It has nothing to do with a "historical-moral component" or a class struggle. It's a competitive market outcome. If you have a fixed supply of a resource that is essential in production, the price of that resource will go up if production in increased, because the capitalists will need it and compete for it. Compare it to land. The land owner will extract a rent from the capitalist because its not a commodity that can be produced like any other (of course that rent is not socially necessary in production). As long as workers own their working time, they will extract a "rent".

Needless to say the labor share of total income has remained more or less constant for ages.

Marx isn't somehow in contradiction to supply and demand and makes many of the same elementary points on it's influence.

However, what do you make of unions successfully struggling for a shorter working day or increases in pay and so on which would cut into productivity and profits? Is such class struggle without any impact on wages? Or is your point that it isn't primary because if there was is no demand you can't struggle for higher wages, or if their is an abundance of supply, the ability of organizing workers for collective bargaining is significantly reduced.

Like this brief piece explicitly opens with the issue of supply and demand.
https://www.marxists.org/archive/marx/works/1847/wage-labour/ch04.htm
Now, the same general laws which regulate the price of commodities in general, naturally regulate wages, or the price of labour-power. Wages will now rise, now fall, according to the relation of supply and demand, according as competition shapes itself between the buyers of labour-power, the capitalists, and the sellers of labour-power, the workers. The fluctuations of wages correspond to the fluctuation in the price of commodities in general. But within the limits of these fluctuations the price of labour-power will be determined by the cost of production, by the labour-time necessary for production of this commodity: labour-power.

He then goes onto briefly discuss the minimum wage being based on the reproduction of the working class as a whole, rather than any one individual as many individual workers may barely subsist.
Thus, the cost of production of simple labour-power amounts to the cost of the existence and propagation of the worker. The price of this cost of existence and propagation constitutes wages. The wages thus determined are called the minimum of wages. This minimum wage, like the determination of the price of commodities in general by cost of production, does not hold good for the single individual, but only for the race. Individual workers, indeed, millions of workers, do not receive enough to be able to exist and to propagate themselves; but the wages of the whole working class adjust themselves, within the limits of their fluctuations, to this minimum.

However, I don't think he finds it sufficient as there is more going on in determining the price of a commodity.
The idea I take is that commodities aren't priced in an arbitrary fashion but tend t fluctuate around the value of a commodity ('natural price'), except when somethings perhaps stretch them far apart.
Remember Marx doesn't focus solely on price and in fact may even argue that the fixation on price alone is an infatuation with an appearance but doesn't understanding economic phenomenon beyond their appearances because if "the real laws of phenomena do not and cannot appear directly on the surface of the phenomena under investigation in the form of simple identicalness. If concepts could be grasped merely by finding a common element within the phenomena concerned then this would be equivalent to saying that appearance and essence coincided, that there was no need for science.".

So can see how he finds this narrow focus inadequate in engaging Samual Bailey, who denies the existence of value and says that only price exists. The emphasis being that the regularity of pricing in commodities is to be explained on the basis of value otherwise we have left prices unexplained. The idea being against those who say pricing is simply subjective referencing do not really explain price as they just push the relation to price to price at an earlier time, remaining at the same level of analysis and not going deeper.
Spoiler: show
https://kapitalism101.wordpress.com/2014/04/28/intrinsic-value/
https://kapitalism101.wordpress.com/2011/11/15/law-of-value-8-subjectobject/
Even more damning is the fact that capitalist societies don’t have anything to do with barter. People don’t produce to directly exchange products for other products. We produce in order to exchange things for money. Money is an intermediary in all economic activity. So it makes no sense to say we measure our subjective utility for coconuts against fish when exchanging. We measure everything against money. When you are in the supermarket calculating your preference scales with the Preference App on your iPhone you aren’t just considering your preferences for fish and coconuts in the abstract, as if on a desert island. You are also considering the market prices of these commodities. This market price already exists before you make your subjective value judgements.

But this is problematic. Subjective valuations were supposed to explain price, but now we have to assume the prior existence of prices in order to explain subjective value judgements. It seems we are stuck in a big messy circle.

And if we are exchanging everything for money then we must have a utility for money right? But money has no direct utility. It’s not even good for blowing your nose on. The value of money is what it will buy. And this is not set by our preferences but instead reflects the relation of money to all other commodities, reflecting the vast interpenetration of millions of markets all over the world. There is no such thing as a personal utility for money because money’s value is already established by forces beyond our control. (3)
...
Objections to Marx’s theory of value often have to do with the way his theory of value relates to market prices. If value comes from the amount of labor that goes into producing things, then how do we explain the fact that a rise or fall in demand changes market prices? The fact that demand influences price makes it seem like subjective decisions influence value as much as labor time.

https://www.marxists.org/archive/rubin/value/ch12.htm
One can see that here Marx had in mind an opponent who wanted to show that nothing exists except relative exchange values, that the concept of value is thoroughly superfluous in political economy. Who was the opponent alluded to by Marx?

This opponent was [Samuel] Bailey, who held that the concept of value is thoroughly unnecessary in political economy, that one must restrict oneself to the observation and analysis of individual proportions in which various goods are exchanged. Bailey, who was more successful in his superficiality than in his witty critique of Ricardo, tried to undermine the foundations of the labor theory of value. He maintained that it is wrong to speak of the value of a table. We can only say that the table is exchanged once for three chairs, another time for two pounds of coffee, etc.; the magnitude of the value is something thoroughly relative, and it varies in different instances. From this Bailey drew conclusions which led to the negation of the concept of value as a concept which differs from the relative value of a given product in a given act of exchange. Let us imagine the following case: the value of a table equals three chairs. A year later, the table is exchanged for six chairs. We think we are right if we say that even though the exchange value of the table has changed, its value has remained unchanged. Only the value of the chairs fell, to half their former value. Bailey finds this statement meaningless. Since the relation of exchange between the table and the chairs changed, the relation of the chairs to the table changed also, and the value of the table consists only of this.

In order to disprove Bailey's theory, Marx considered it necessary to develop (in Capital) the conception that exchange value cannot be grasped if it is not reduced to some common factor, namely to value. The first section of Chapter 1 of Capital is devoted to giving a foundation to this idea of the transition from exchange value to value and from value to the common basis under both, namely labor. Section 2 is a completion of Section 1, since here the concept of labor is analyzed in greater detail. We may say that Marx passed from the differences which are manifested in the sphere of exchange value to the common factor which is at the basis of all exchange values, namely to value (and in the last analysis, to labor). Here Marx shows the inaccuracy of Bailey's conception of the possibility of restricting analysis to the analysis of the sphere of exchange value. In Section 3, Marx undertakes the opposite course and explains the way the value of a given product is expressed in its various exchange values. Earlier Marx had been led by analysis to the common factor, and now he moves from the common factor to the differences. Earlier he refuted Bailey's conception, and now he completes Ricardo's theory, which did not explain the transition from value to exchange value. In order to refute Bailey's theory, Marx had to develop Ricardo's theory further.

Actually, Bailey's attempt to show that there is no value other than exchange value, was facilitated significantly by Ricardo's onesidedness. Ricardo could not show how value is expressed in a determined form of value. Thus Marx had two tasks: 1) he had to show that value must be revealed behind exchange value; 2) he had to prove that the analysis of value necessarily leads to different forms of its manifestation, to exchange value.

How did Marx make the transition from exchange value to value?

Usually, critics and commentators of Marx hold that his central argument consists of his famous comparison of wheat and iron on page 3 of the first volume of the German edition of Capital. If wheat and iron are equated with each other, Marx reasoned, then there must be something common to both and equal in magnitude. They must be equal to a third thing, and this is precisely their value. One usually holds that this is Marx's main argument. Almost all critiques of Marx's theory are directed against this argument. Unfortunately, every work directed against Marx maintains that Marx tried to prove the necessity of the concept of value by means of purely abstract reasoning.

But what has been completely overlooked is the following circumstance. The paragraph in which Marx treats the equality of the wheat and the iron is merely a deduction from the previous paragraph, which says: "A given commodity, e.g., a quarter of wheat is exchanged for x blacking, y silk, or z gold, &c. - in short, for other commodities in the most different proportions. Instead of one exchange-value, the wheat has, therefore, a great many. But since x blacking, y silk, or z gold, &c., each represent the exchange-value of one quarter of wheat, x blacking, y silk, z gold, &c., must, as exchange-values, be replaceable by each other, or equal to each other. Therefore, first: the valid exchange-values of a given commodity express something equal; secondly, exchange-value, generally, is only the mode of expression, the phenomenal form, of something contained in it, yet distinguishable from it" (C, I, p. 37).

As can be seen from this passage, Marx does not examine the individual case of equalization of one commodity for another. The starting-point of the argument is a statement of a well-known fact about the commodity economy, the fact that all commodities can be equalized with each other, and the fact that a given commodity can be equated with an infinity of other commodities. In other words, the starting point of all of Marx's reasoning is the concrete structure of the commodity economy, and not the purely logical method of comparison of two commodities with each other.

Thus Marx starts from the fact of manyfold equalization of all commodities with each other, or from the fact that every commodity can be equated with many other commodities. However, this premise in itself is still not enough for all the conclusions which Marx reached. At the basis of these conclusions there is still a tacit assumption which Marx formulates in various other places.

Another premise consists of the following: we assume that the exchange of one quarter of wheat for any other commodity is subsumed by some regularity. The regularity of these acts of exchange is due to their dependence on the process of production. We reject the premise that the quarter of wheat can be exchanged for an arbitrary quantity of iron, coffee, etc. We cannot agree with the premise that the proportions of exchange are established every time, in the act of exchange itself, and thus have a completely accidental character. On the contrary, we affirm that all the possibilities for the exchange of a given commodity for any other commodity are subsumed under certain regularities based on the production process. In such a case, Marx's entire argument takes the following form.

Marx says: Let us take, not the chance exchange of two commodities, iron and wheat, but let us take exchange in the form in which it actually takes place in a commodity economy. Then we will see that every object can be equalized with all other objects. In other words, we see an infinity of proportions of exchange of the given product with all others. But these proportions of exchange are not accidental; they are regular, and their regularity is determined by causes which lie in the production process. Thus we reach the conclusion that the value of a quarter of wheat is expressed once in two pounds of coffee, another time in three chairs, and so on, independently of the fact that the value of a quarter of wheat has remained the same in all these cases. If we assumed that in each of the infinite proportions of exchange, the quarter of wheat has another value (and this is what Bailey's statement can be reduced to), then we would admit complete chaos in the phenomenon of price formation, in the grandiose phenomenon of the exchange of products by means of which the comprehensive interrelation of all forms of labor is carried out.

The above reasoning led Marx to the conclusion that even though the value of the product is necessarily manifested in exchange value, he would have to subsume the analysis of value under that of exchange value and independently of it. "The progress of our investigation will show that exchange-value is the only form in which the value of commodities can manifest itself or be expressed. For the present, however, we have to consider the nature of value independently of this, its form" (C., I, p. 38). Consistently with this, in the first and second sections of Chapter 1 of Capital, Marx analyzed the concept of value in order to pass to exchange value. This distinction between value and exchange value leads us to ask: what is value as opposed to exchange value.

I imagine for Marx, the idea in emphasizing minimum wage in terms of the reproduction of the working class is that it constitutes the value of workers within a capitalist economy.

And it was my impression that "labor share of total income" has actually decreased in recent decades. Is your statement qualified in some way in time, place, or something.
[ur]https://blogs.imf.org/2017/04/12/drivers-of-declining-labor-share-of-income/[/url]
After being largely stable in many countries for decades, the share of national income paid to workers has been falling since the 1980s.

Image
Which is quite compatible with the point that income inequality has greatly increased the last few decades.
https://blogs.imf.org/2017/03/20/chart-of-the-week-inequality-and-the-decline-in-labor-share-of-income/
Labor’s share of income declines when wages grow more slowly than productivity, or the amount of output per hour of work. The result is that a growing fraction of productivity gains has been going to capital. And since capital tends to be concentrated in the upper ends of the income distribution, falling labor income shares are likely to raise income inequality.

So I don't understand your claim here, as I see it only being true for the 20th century up to a point where it has since declined.
https://www.bls.gov/opub/mlr/2017/article/estimating-the-us-labor-share.htm
The labor share—the fraction of economic output that accrues to workers as compensation in exchange for their labor—was thought by some early-to-mid-20th-century economists to be relatively stable. Yet its decline during the second half of the 20th century and on into the early years of the 21st century has shown otherwise, attracting the interest of many researchers.
#15171609
blackjack21 wrote:
So you believe in this inevitability theory too? Redundant wealth is governed by the law of marginal utility. Marginal utility goes negative the more you consume something you don't need. It leads to waste and decay, not socialism.

I work in open source software, and it's a really interesting area because we give the product away for free but we charge for support. The tension in our business is that demand is perfectly inelastic on the basis of price for something that is given away free. Yet, there are other forms of elasticity not really taught much in b-schools. I prefer to think of price as an impediment to demand, and that we should think of it a bit more abstractly as "impedance elasticity of demand."

The harder a product is to use, the less usable it becomes. For example, Facebook is free to you. Yet, they've spent hundreds of millions if not billions on user interface design. Staggering amounts of money... all so that you will use their product, give them copious amounts of information about you and thereby see their eerily very targeted advertisements. It's pretty incredible when you think about it.

A linux distribution like Fedora or Ubuntu already has most of what you need for computing--free browsers, word processors, spreadsheets, presentation programs, video editors, etc. I understand people like Mac or PCs better. However, I don't think they are much more advanced than open source anymore--with the possible exception of Adobe's media products (Photoshop, Illustrator, InDesign, etc are superior to any equivalent open source solution). I do think Hell, you won't get AutoCad, but you can even get free CAD programs in open source too, and they are every bit as good as the ones you'd pay top dollar for in the early 1990s.

So here you do have something that is community owned and free to everyone. Yet, people CHOOSE to buy macs or PCs with Windows installed. Why? People do not naturally choose the cheaper option.

I think Tainari88 believes that her brand of socialism would work great, but I don't think she'd like living in Mao's China wearing black pajamas and having only a bicycle for transportation.


Wealth creation happens every day. For example you can buy dining tables made from reclaimed scrap wood for as much as 2000.00 USD. A pile of worthless scrap wood transformed into wealth. Every time the carpenter creates a new piece furniture he adds to the wealth of the world because there are people that are highly interested in that table. A person that writes an app that helps vendors sell a product adds massive wealth to the world. When Taylor Swift makes an album and everybody wants a copy massive wealth is created. JK Rowlings created enormous wealth with Harry Potter. There is no point where wealth creation does not happen despite marginal utility of a given product because new products are created on a daily basis. I apologize as you know this, but it seems others don't. The left wingers and the socialists types such as POD, Tainari88, late, et al-------------see wealth as a pie with a finite number of slices. If Gates and Bezos have too much money that means that they took very large slices from the available wealth of the world and hence the poor get less. This is how they think.

As for capitalism culminating in socialism. This would be a natural if wealth is too abundant. The biggest socialist in the world is Bill Gates! He knows he cannot spend all the money he made so he gives it away. A world filled with Bill Gates types would be a bonanza for those that think all day long about wealth redistribution. However, they see the Bill gates as the enemy.

The first cell phone was phone huge; it measured 11 inches tall and weighed about 2.5 pounds. Motorola DynaTAC ($3,995): After the first mobile cell phone demonstration, it took about a decade of further development before it was available to consumers. The Motorola DynaTAC 8000X hit the market in 1983 with a hefty price tag of $3,995. Today homeless people have free cell phones. All of that in less than 40 years. If this trend continues the poor will have access to the same luxuries the rich have and it will be FREE!
#15171613
Julian658 wrote:
If this trend continues the poor will have access to the same luxuries the rich have and it will be FREE!



You mean like a roof over their head?

Only if you support Progressives...
#15171614
@blackjack21 I am pressed for time. But a lot of Black Democrats think it might be a rigged system for discounting the Black vote in Georgia. Georgia is getting purple and as such the Red ones are upset and they want a bar code system that could be easy to hack. I trust that opinion. For me the Republicans in Georgia are steaming mad at having Trump lose due to Georgia's Stacy Abrams getting active and pushing in that Ossoff guy and Warnock. But? I have zero trust in the two Republicans who were given millions for campaign funds and lost and cry all damn day about it. I don't trust Democrats in general either, but Black people screaming about Georgian racist Republican tactics? I do trust.

https://www.ajc.com/news/state--regiona ... bLcUEwTlN/

Kids need summer activities and all kinds of activities and families need support. It is way too hard raising kids, going to work full time, trying to get advanced educations, cleaning and cooking and rat racing all day. I know BJ. I have been there and done that.
#15171615
late wrote:You mean like a roof over their head?

Only if you support Progressives...

late

Homeless is a different issue, that is nihilism, mental illness, and drug use. The few homeless people that are not like that are every easy to help. Note, how homelessness is greater in woke cities.

The downside of giving people free stuff is a dystopic world where people have no purpose to exist.

The culmination of capitalism into socialism happens naturally. The woke people trying to take away the money of the rich by force is not the answer. The rich will give away their money once they have a lot of wealth. We want the list of philanthropists to be very large.

https://en.wikipedia.org/wiki/List_of_philanthropists
#15171616
late wrote:You mean like a roof over their head?

Only if you support Progressives...

How come a person that is homeless has a cell phone?
Image

This trend will continue and at some point the poor will be driving Teslas and BMWs. Actually, some already do. Capitalism and technology will eventually eliminate poverty. However, those that contribute nothing to society and get everything for free will be dysfunctional and nihilistic. That is what we see in San Francisco and Seattle.
#15171618
Julian658 wrote:
Capitalism and technology will eventually eliminate poverty.



Capitalism was making poverty worse before Biden.

Actually, it was corrupt and sleazy politics, and it could go back to getting worse as soon as Republicans can get back to being corrupt, sleazy, and in power.
#15171621
Wellsy wrote:Well it doesn't introduce another assumption as much as pose the dilemma that one of the assumptions of the model is unexplained and inadequate. The assertion by Kliman is that "if profit rates are equalized across sectors, the level of the uniform profit rate is uniquely determined by physical coefficients." this he challenges.
"Yet, contrary to the apparent belief of the proponents of the Okishio theorem (and most readers of Dmitriev and Sraffa), it is simply not true that the magnitude of the uniform profit rate is uniquely determined by physical input/output coefficients."
As you can see here, there is an assumption which is being built upon. You might consider this narrowly as an expanding of the assumptions, and it certainly does as Okishio's theorem defenders are not pushing it beyond this apparently.
But the point is that there is a logical connection between the limitation of the assumption and some truth which is provable. The point is that an internal criticism begins with the premises of another school of thought but shows how they fall into contradiction. The very focus of Marxist analysis is to reveal the limits upon which something is true or not. Because truth isn't about universal truth alone, but often many things are true but within qualified limits, they fall into absurdity when they become to generalized. There is such a tendency upon new scientific discoveries like with Pavlov's generalization of the reflex with the bell and the salivating dog and suddenly everything is explained by reflexes. Except not everything is so directly synonymous with such conditioned reflexes. So they fall into error.


I would say that is actually a relaxation of an assumption. Although I'd need to check the argument in more detail, because e.g. Okishio relies on some particular production function.

Wellsy wrote:And that's fine that you are emphasizing that there are several assumptions in such an interpretation. Marx is often criticized on many counts for not explicitly laying out the very methods in which he analyzes things and so people had to investigate a great deal to even come up with competing interpretations of what is consistent with Marx and what they think is indeed correct (do they agree with Marx?).


Indeed, and that's because Marx and the classical economists in general didn't use enough math. This doesn't really mean they didn't have important insights, but it does mean their ideas may have some ambiguities that can be avoided by using a more formal approach in theorizing.

Wellsy wrote:Indeed, the idea of simply finding the true interpretation would be as fruitless as the final word on a religious text. Meaning isn't entirely contained within symbols/words but is always related to the broader world, which changes.
However, the emphasis on internal consistency does have some significance, that it is somewhat damning to find contradictory claims and there needs to be a way to resolve them. Kliman only goes as far as to defend Marx as internally consistent and when interpreted as such, some criticisms fall away as not properly criticizing their target.
Think of how an theist might criticize evolutionary theory without actually having learned what it is, they miss the mark and if you have some knowledge about it you can clear see where. Just as some scientists are philosophically inept where they try to use empirical reasoning and so on to contend with a theological issue on the existence of God. They talk past one another when they're not in some mutual understanding.


I agree with you that internal consistency is important, although in this case it would refer to the internal consistency of a particular interpretation of what did Marx really mean. Another good thing about math is that it makes achieving internal consistency either, because you can spot the holes in a formal proof if you want to (if the proof is incorrect, you can find counterexamples to show so).

Wellsy wrote:I think one concern is the idea is that machines may improve physical production or the number of use-values, but that the issue of profit is measured in exchange values and real wages is based on the comparison of what commodities i.e. goods and services which can be bought. Michael Roberts is critical of this being possible to always make such a rigorous comparison on the basis that use-value does not have a shared basis for comparison. The use-value of a car is not comparable to that of a buying a book to read, and this is exacerbated across time where there are entirely new commodities and needs for the modern person which simply did not exist in the past. How doe one compares the commodity of an old rotary telephone compared to an iPhone?


That's an old problem in economics and actually in index theory as well. How do you introduce a new product in e.g. a consumer price index? There is no silver bullet to respond to it, but it is possible to at least do some linking to get a more less internally consistent series that allows some rough comparisons.

Wellsy wrote:And so it does suggest to me that Okishio's theorem is an example of physicalism in emphasizing real wages.
https://kapitalism101.wordpress.com/2008/10/16/falling-rate-of-profit/

https://kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/

This at least is part of Michael Robert's criticism of the focus on real wages, that it's simply not an adequate measure, because profit isn't measuring use-value and this seems to confuse the very contradictory nature of commodities as simultaneously use-values and exchange values.

But when considering increases in physical production, the early innovater still get to sell their product at the same price as before, but their efficiency in physical productions creates a 'super-profit' because they're able to produce more physical output for less cost, but sell at the same price as before, resulting in a 'super profit'. But then the innovation becomes generalized across the competition and the price falls because productivity has increased, meaning less socially necessary labor is required to produce the commodity on the whole. Or simply put, you have the same amount of workers, but they're able to produce more within the same amount of hours of work. And it can be the case that value hasn't been expanded, rather you've spread the value across an even greater amount of commodities. More slices cut up from the 'value' pie.
Because you haven't extracted more value out of workers by having them work more hours or be paid less, you've simply increased physical production which outcompete other businesses, but the divide in the working day between labour power (wages) and labour performed hasn't changed.



Well, here you would run into the issue of whether it makes sense to rely on use values at all. I think that, with innovation factored in, it makes less sense to consider use values because innovation may in itself change the physical properties of the goods produced and may even change the usefulness of other physical or natural elements (e.g. uranium probably had a low unit use values 1000 years ago, while one may agree unit use values are very high today).

This is one reason why I don't really think the LVT is all that useful in practice. It would seem its very use will force you into some theoretical straightjackets you don't really need to rely on. And of course, one may also wonder if use values are observable or if, like utility, they are actually an abstract measure (but, unlike utility, use values have a cardinal rather than an ordinal nature).

If you want to keep the distinction, however, one would then run into the issue of what do you mean about "profit" here. Are you measuring it in terms of use or exchange value? If the prices of commodities tend to go down and unit use values, why wouldn't the capitalist be better off even if profits eventually go back to their normal levels or decrease? I'm asking because it seems part of the criticism is claiming there would be deflation, but without taking the consequences of it to its full extent.

Wellsy wrote:Indeed, it's not a foregone conclusion that he could have made some error. But it's not all that apparent based on feedback that he's necessarily and evidently wrong either. So even feeling that out has been hard as I am not familiar with much criticism of Kliman


It's also possible Marx himself was vaguer than he thought, and as such there is some indeterminacy in his verbal modelling because of some definitions he uses. If that's the case, then it would also be possible for two different interpretations of Marx to be correct at the same time, even if they lead to different conclusions. Same could hold for other classical economists.

Wellsy wrote:Of course, different schools of thought are in some relation to one another based on the shared object of their consideration and many may cross the room. It's just not necessarily typical as it requires we invest enough time and effort with an open mind to the influence of what is initially an opposing viewpoint.
Human limitations making learning in-depth to know for ones self an arduous task.


Indeed, and sometimes it takes an investment to even get into the jargon.

Wellsy wrote:That capital is producing the changes in raw materials into other more expensive commodities which can actualize their value on the market? This is vague because capital most certainly puts things into motion within the capitalist mode of production but it does not literally create things. In fact Marx's distinction between labor and labor power comes from his historical insight emphasizing how man has always laboured, but labour power as a commodity has not always existed.


Think about AI advances in the last few years. Up to what extent can you automate processes so humans don't have to bother with them? Is it possible that an AI will allow us to automate more processes as to become able to produce more on its own? If a whole line becomes automated, what role is labor playing here?

Wellsy wrote:Because for Marx, labour is the universal which underpins everything which is human, there would be no such things as a human being as we know it without consideration of the labor process underpinning the satisfaction of our needs, as well as their development.
http://d-scholarship.pitt.edu/10867/1/VWills_ETD_2011.pdf

Of which Marx would emphasize those who provided their own use-values and never turn their products of labor into commodities on a market.
http://www.abrahamlincolnonline.org/lincoln/speeches/fair.htm

This is from a Speech by Lincoln which reflects a time with a lot of small farmers made up the U.S. and it reflects a point about how dominating the market can be in modern life when say there is an economic crisis but you have your own means of subsistence.

Then there are separate arguments as to how labor is the substance of value, it creates new value, and that it is pretty difficult to conceive of value ("natural price", not price) independent of labor.
https://kapitalism101.wordpress.com/2014/05/03/on-labor-as-the-substance-of-value/
Whether it is acquiring raw materials, molding them into a socially useful object, or social relations which make land more worthwhile acquiring and thus in higher demand. To which the idea is that labor clearly precedes capital, so the idea of somehow capital somehow being the essential thing would seem to universalize capitalist production and indifferent to qualitative differences where man clearly labours without a need for capital.


You can derive other notions of value that also rely deeply on humans and humanity. Subjective, marginalist notions are probably the best example of such an alternative, and that one would also consider taking care of the basic physical needs of humans... And a lot more than that as well.

Wellsy wrote:Math is a universal language as quantity is a prevalent concept and we've built up that concept into impressive means of analysis. Having a shared language as a basis for understanding and proofs is certainly important as I do think that is what makes comparisons more viable, of course it is insufficient also where there are different assumptions at play. Math being a kind of neutral tool, method, which can be appropriately used or not.
Indeed I do compare learning math to learning a language, you just got to get in and swim to pick it up. In fact, I'm hoping to learn a lot more math in part because I've been introduced to the sense of math having critical reasons behind procedures where as a lot of my education was the learning of procedure but not really an insight into why a lot of the time. So one can perform a math computation but not really understand its significance, I think this is what makes Math unappealing compared to a math geek who talks about the beauty of the connections and so on. A whole different experience of it.

I agree that there is sometimes a context or milieu that is missing when reading old texts that apparently were easy enough for others to read but are more cryptic from the modern view point. I have not dived in deep into Marx's text in par because some are collosal but at the same time I had spent a lot more time looking into Marxist theory so as to better approach him with some understanding rather than a cold read. Like yes you want to read the original text but it helpful to have someone lay out things for you so you can navigate it better.


I agree with you here. I hope you get more into math, and it's not just useful because it deals with quantities (it can deal with more abstract concepts than that too). The real usefulness is that it will discipline your thinking and reasoning.

I actually think many professions have students learning more math than they'll actually use because of the latter. Sometimes the way you think is more important than the technical skills you learn.
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