[OPE-L:2943] Re: Re: Re: Marx and Keynes and Riccardo on money

From: riccardo bellofiore (bellofio@cisi.unito.it)
Date: Sat Apr 29 2000 - 06:25:31 EDT


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Fred,

thank you very much for your detailed answer. Unfortunately, my answers to
you, as the answers which I'm sending to you and other comrades, are not
accurate as they should be. I am a bit ashamed: I am able to gain from the
list much more than I am able to contribute [I am really grateful to Jerry
for letting this list be so interesting and pluralist, and also to accept
contributors as inefficient as me!]

Frankly, I think that the differences now are clear between you and me,
though it seems difficult to go on, since we do not understand the other's
objections!

For example, you say:

>I am not saying that Keynes had NO theory of money, but rather that Marx
>had a BETTER theory of money - because Marx's theory explains the
>connection between the nature of money and the value of commodities,
>and Keynes' theory does not make this crucial connection.

Of course, my answer would be: you are recognizing that Keynes had a
*theory* of money, and this seem to be more positive than Martha's
judegmente, however you're still juding Marx's better from Marx's
*standpoint*, and this may or may not be true, but in any case, it is
inappropriate as a standard to judge Keynes's theory of money. Let us
reconstruct Keynes in his own terms, Marx in his own terms, and then ask
ourselves if in *both* there are problems, and if, by chance, Keynes saw
more clearly something Marx just hinted. But this answer of mine, I guess,
is incrompehensible in your outlook.
>

YOU SAY

>> Three answers (two are inconsistent, but let's put them forward
>>nevertheless!)
>
> (a) why Keynes should explain surplus value as objectified
> labour? That's Marx!

>I was talking about Riccardo here (two c's!), not Keynes. It seems to me
that you also want to take money as given, or at least not derive it from
the value of commodities, as Marx did. If I am wrong about that, please
explain further. But if I am right, then I would repeat the question
quoted above to you: If money is not understood as objectified labor,
then how can surplus-value (or delta M) be explained as objectified
surplus labor? More on this below.

And you go on saying:

>What is the basis of your *IF* assumption of abstract labor?
>How is this assumption grounded or justified?
>

My answer would be: I have written on this in at least all my '90s paper
(the Bergamo paper with Finelli, the Bergamo paper on Napoleoni, the
Amsterdam ISMT paper, the two Mexico papers, the IWGVT papers), where, as
you know, I put forward the idea tha Marx posits in the first book of
Capital the argument that the new value produced represents nothing but
living labour. If you go and see, my argument does not depend on money as a
commodity, or as objectified labour, but it is quite compatible with a
non-commodity theory of money. In my argument, as you may check, the idea
is that money capital "command" living labour, as potential abstract
labour, before final exchange, and this grounds the reduction of the whole
new value, and hence also surplus value, to labour, even before final
exchange. But if you've not been convinced by my papers, it is unlikely
you'll be convinced by these few lines written in a hurry.

>> BTW2, French authors coming *from* Marxism went a long way in trying to
>> ground a theory of money. Aglietta & Orlean went so far as to enroll the
>> anthropologist RenČ Girard, and Benetti & Cartelier the sociologist Georg
>> Simmel. And they all made a serious confrontation with Marx's deduction of
>> money from the commodity (serious does not mean I agree with them).

You write:
>
>As I understand it, the object of Marx's theory is an existing capitalist
>economy. Money is being invested and more money is being recovered
>through the production and sale of commodities. In this existing
>capitalist economy, there are existing stocks of means of production and
>existing stocks of the money-commodity, that have been produced in
>previous periods. Surely one has to assume a given stock of means of
>production. Otherwise means of production would also be impossible,
>i.e. means of production cannot exist prior to production because these
>means of production themselves have to be produced. Why not also assume
>in similar fashion an existing stock of of the money-commodity that has
>been produced in prior periods and that functions now as the measure of
>value? Your argument seems to deny or ignore prior periods of production.

No. I think (as Schumpeter, but I would say also Marx) that the logical
analysis must start ab ovo (I don't know how to translate this Latin term
in English). This does not mean that history is not relevant. It comes in
only when the logical deduction compels it, e.g., in my view, in the money
deduction, to explain how money becomes the representative of immediate
social labour (the role of the State etc.), and to explain how labour power
is available to capitalists.

You can actually explains the existence of durable means of production as
results of capitalist processes, but (in my view) you cannot explain
capitalist processes without finance to production , and you cannot have
money as a capitalist commodity financed by a money commodity.

Etc.. But I think this is clear to you, you simply don't accept it.

>I also think that we need to more clearly distinguish between the
>different functions of money, especially between money as means of
>circulation and money as measure of value. You seem to be talking about
>money as MEANS OF CIRCULATION, and seem to argue that a commodity-money
>has seldom if ever actually functioned as a means of circulation. But I
>am talking about (and I think Claus also) money as a MEASURE OF VALUE. I
>do not disagree that commodity-money has seldom actually functioned as a
>means of circulation. As Marx himself emphasized, commodity-money is
>usually replaced in circulation by tokens of itself, including the M at
>the beginning of the circulation of capital. However, until recent
>decades, these tokens were convertible into the money-commodity in fixed
>proportions. Through this convertibility, the money-commodity still
>functioned as the measure of value. The key question at the present time
>is whether or not, in the absence of this convertibility, gold (or perhaps
>some group of commodities?) still functions in some way as the ultimate
>measure of value.

This would deserve a longer treatment. I am not denying that there is a
problem of 'anchor' to understand how actually the monetary system works.
What I am simply saying is: to have a monetary economy you must first
logically explain how money comes 'in', before inquiring about hot it works
as a measure of value.
>I am also talking about the *LOGICAL ESSENCE* of money, not the historical
>origins. Before one can explain how money is transformed into more money,
>one must first explain what money is, the nature or essence of money.
>Marx of course did this in Part 1 of Vol. 1. Marx derived the nature of
>money as the social representation of abstract labor. This then is the
>basis for his later explanation of "more money" as the result of surplus
>labor in Chapter 7 and beyond.

>
>Riccardo, if you were writing your book, what would be your Part 1?
>Would it be different from Marx's? If so, how?
>Would it explain the "logical essence" of money? If so, how?
>

Frankly, I would not embark in writing Capital again. The starting point of
Capital is OK, provided we understand that after the III book, we should
leave aside the idea that the essence of money is that of being a
commodity? Does this mean that we have to rewrite something in the first
chapters? May be. Or may be we have to read them differently.

My general attitude is to differentiate my reading of an author from what
the author actually said. So, I take Marx as wanting a money commodity, but
I think that 930f his construction is alive and well without money
commodity, and that most of the things he said of money may be repeated in
a different non commodity theory of money framework.

I'm sure this post is useless, but I think that what we may do now is
simply to check where the differences are.

riccardo

        Riccardo Bellofiore
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