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Gil has argued in a number of posts, including his most recent, that
Marx's argument in Chapter 5 is "invalid," a "non-sequiter," etc.
But I don't think so. I think Gil misunderstands Marx's argument in
Chapter 5.
1. The main point of Marx's argument in Chapter 5 is that the total
amount of surplus-value produced by capitalist production as a whole
CANNOT BE INCREASED SOLELY ON THE BASIS OF THE EXCHANGE OF COMMODITIES.
a. This is obviously true if exchange is assumed to be the exchange of
equivalents.
In its pure from, the exchange of commodities is an exchange
of equivalents, and thus is not a method of increasing value...
`Where equality exists, there can be no gain.' (p. 261)
b. Marx argued further this is also true even if non-equivalents are
exchanged.
The capitalist class of a given country, taken as a whole,
cannot defraud itself. (p. 266)
Marx stated this main conclusion of Chapter 5 as follows:
However, we twist and turn, the FINAL CONCLUSION
remains the same. If equivalents are exchanged, no
surplus-value results. And if non-equivalents are exchanged,
we still have no surplus-value. Circulation, or the exchange
of commodities, creates no value. (p. 266)
2. Gil calls this result "trivial" or "irrelevant". But Gil does not
understand. This conclusion is neither trivial nor irrelevant, although
it certainly is straightforward. This conclusion was important for Marx
because many classical economists had tried to explain the profit of
capitalist production in precisely this way - solely on the basis of
exchange. In Chapter 5, Marx discussed two such "profit through
exchange" theories:
a. Theories which explain profit through exchange on the basis of an
increase of use-values (e.g. Condillac, pp. 261-62). Marx commented on
the continuing acceptance of this theory among "modern economists":
"Still, Condillac's argument is frequently repeated by modern
economists, especially when the point is to show that the exchange
of commodities in its developed form, e.g. commerce, is productive
of surplus-value." (p. 262)
b. Neo-mercantilist theories which explain profit through exchange by
selling commodities above their value (e.g. Malthus and Torrens, pp
262-65). In an earlier draft of this chapter (in the first part of the
1861-63 Manuscripts, published for the first time in 1989), Marx wrote:
"... one still meets with the nonsensical assertion that
surplus-value as such derives from things being sold dearer than
their purchase price. Thus, e.g. Mr. Torrens (1821)."
(MECW, vol. 30, p. 26)
Later in the 1861-63 Manuscript, Marx briefly discussed "Malthus's
vulgarized view of surplus-value" of "profit upon alienation."
(MECW, vol. 32, pp. 213-17 or TSV. III. pp. 18-22)
So it was important for Marx to critique these still influential theories
of profit arising solely from exchange. And that is the main point of
Chapter 5.
3. Gil argues that the main point of Chapter 5 is something entirely
different: to prove that surplus-value can be explained only on the basis
of the assumption of the exchange of equivalents or prices = values.
However, the exchange of equivalents, or prices = values, is NOT A
CONCLUSION OF CHAPTER 5, but rather is a CONCLUSION OF CHAPTER 1 !! This
conclusion of Chapter 1 then becomes the fundamental presupposition (or
the "starting-point") for the rest of Marx's theory, beginning most
importantly with his theory of surplus-value in Part 2. Marx doesn't have
to derive in Chapter 5 what he has already derived in Chapter 1. Allin
seems to be saying something like this in his recent posts.
Now, one might not like Marx's derivation of the exchange of equivalents,
or prices = values, in Chapter 1. But that is another matter. Surely
Marx, in his own head, considered this conclusion to have already been
derived in Chapter 1, as one of the "immanent laws of commodity
exchange" that he refers to in Chapter 5. Therefore, it seems clear that
Marx was NOT trying to prove in Chapter 5 what he had already derived in
Chapter 1. Gil is right that no additional arguments are presented in
Chapter 5 to reach this conclusion. But that is because no such
additional arguments are necessary (from Marx's perspective). Rather,
this conclusion was already derived in Chapter 1, and then became the
basis on which surplus-value was to be explained. Gil says that Marx's
argument in Chapter 5 "assumes what is to be proved." We can now see more
precisely that instead Marx's argument ASSUMES WHAT HAS ALREADY BEEN
DERIVED.
Let's quickly review the beginning and the end of Chapter 5 where Marx
referred to this "previously derived law" of the exchange of
equivalents. Marx began Chapter 5 by stating the puzzle that the
emergence of surplus-value appears to contradict
"ALL THE PREVIOUSLY DEVELOPED LAWS bearing on the nature of
commodities, value, money and even circulation itself."
It soon becomes clear that the main "previously developed law" that Marx
has in mind is the exchange of equivalents and Marx quickly comes to the
conclusion already stated above: "In its pure from, the exchange of
commodities is an exchange of equivalents, and thus is not a method of
increasing value." (p. 261)
At the end of Chapter 5, Marx restated this same "previously developed
law" and emphasized that the crucial task for his theory was to explain
surplus-value on the basis of this "immanent law" of the exchange of
equivalents which had been previously derived.
The transformation of money into commodities has to be developed
on the basis of the immanent laws of the exchange of commodities,
in such a way that the STARTING-POINT is the exchange of
equivalents. (p. 266-67)
This conclusion of logical necessity - "has to be developed" - which is
emphasized by Gil, follows from Marx's arguments in Chapter 1, not from
Marx's arguments in Chapter 5. Surplus-value "has to be developed" on the
basis of the "previously developed laws" in Chapter 1. This conclusion
follows simply and validly from the internal logic of Marx's theory.
4. This assumption of the exchange of equivalents is the reason why Marx
excluded merchant capital and interest-bearing capital (usurer
capital) from his analysis of the circulation of capital and the emergence
of surplus-value in Volume 1 (from Chapter 5 on). Since these particular
forms of capital operate solely with the exchange of commodities, which is
assumed at this abstract level to be the exchange of equivalents, merchant
profit and interest would appear to be an impossibility.
Since, however, it is impossible, by circulation alone, to explain
the transformation of money into capital, and the formation of
surplus-value, merchants' capital appears to be an impossibility
AS LONG AS EQUIVALENTS ARE EXCHANGED. (p. 266)
Gil argues that Marx's exclusion of merchant capital and interest-bearing
capital is not logically valid. But we can see that this exclusion
follows directly from Marx's assumption of the "previously derived law" of
the exchange of equivalents.
4. But, obviously merchant profit and interest do in fact exist. As I
have already explained, Marx's method of explaining merchant profit and
interest is (1) to first explain the total amount of surplus-value
produced in the capitalist economy as a whole in Volume 1 and (2) then in
Volume 3 to explain merchant profit and interest (and rent as well) as
parts of this previously determined whole. As Marx put it, merchant
capital and interest-bearing capital are later explained as "derivative
forms" of the primary form of capital, which is industrial or productive
captal (p. 267).
Notice also that, in Marx's later analysis of merchant capital and
interest-bearing capital, they are analyzed only in relation to productive
capital, i.e. in relation to the capitalist mode of production. The
income of merchant capital and interest-bearing capital are explained as
part of the surplus-value produced in capitalist production, which has
been previously determined. Merchant capital and interest-bearing capital
are never analyzed systematically in relation to non-capitalist modes of
production. All three volumes of Capital, from beginning to end, are
about the capitalist mode of produciton. Marx's theory is a SYSTEMATIC
theory of a HISTORICALLY SPECIFIC CONCRETE TOTALITY - the capitalist mode
of production. The theory is not about other modes of production at
all. Other modes of production are considered only in a few passing, ad
hoc, non-systematic, remarks.
I also want to respond to other points in Gil's most recent post,
especially his critique of the opening paragraph of Chapter 6,
but I will save that for a subsequent post.
Comradely,
Fred
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