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Oops, sorry, I was wrong in my previous post about the scope for potential
agreement, based on a misreading of a comment by Fred in the middle of this
post. I'm very sorry to be obstinate about this, but Fred continues to
insist on the validity of claims by Marx that I've criticized as invalid,
without accurately engaging my critique. Details follow.
Fred writes:
>1. Gil thinks that Marx is trying to prove in Part 2 that capitalist
>production (with wage-labor) is the only possible source of surplus-value.
>Thus, if Marx assumed capitalist production from the beginning as a
>"postulate", as I argue, then Marx's argument in Part 2 is "circular" or
>"ridiculous."
This is a misrepresentation of what I've said. I *don't* "think that Marx
is trying to prove in Part 2 that capitalist production (with wage-labor)
is the only possible source of surplus-value," although his argument, even
if valid, leaves a question mark as to the necessity of capitalist
production for surplus value based on present class conditions. I do
*know*, because it's what Marx actually writes, that he claims an inference
at the end of Ch. 5 to the effect that surplus value must be explained on
the basis that all commodities exchange at their respective values. He
then explicitly uses this result to deduce his subsequent focus on the
purchase and subsumption of labor power (that is, capitalist production).
But this deduction is necessarily circular if we are to assume that Marx
takes capitalist production as an assumption to begin with, and the
deduction is invalid (because Marx's chapter 5 conclusion is invalid) if
Marx does not take capitalist production as an assumption. Either way,
contrary to Marx's explicit argument, and Fred's representation below,
there is no *logical* basis for his subsequent focus on capitalist
production as the basis for surplus value. Given the valid remainder of
Marx's argument through Ch. 6, then, capitalist production might be *just*
as epiphenomenal to capitalist exploitation as Marx argues that price-value
disparities are.
>
>2. The problem with Gil's criticism is that Marx is NOT trying to prove
>that capitalist production is the only possible source of
>surplus-value.
I didn't say he was. See above.
> Capitalist production is indeed assumed from the
>beginning. Or, perhaps a better way of putting it: Marx's theory is ABOUT
>capitalist production from the beginning; capitalist production is the
>historically specific OBJECT of Marx's theory.
The first statement begs the question. Marx never says that, and I explore
in my "two visions" post an alternative interpretation that is entirely
consistent with what Marx wrote in Volume 1, but doesn't lead to Fred's
reading. This alternative interpretation prevents Marx's Ch.5-6 argument
from being circular, but then the latter is a non sequitur.
The second statement is more or less consistent with this alternative
reading, but doesn't get around my critique: Marx's argument through Ch. 6
is either circular or a non sequitur.
> The concepts of Marx's
>theory (commodities, money, capital, surplus-value, etc.) all are defined
>specifically and solely in relation to capitalist production. Specifically,
>the surplus-value that Marx is trying to explain in Part 2 and beyond is
>the surplus-value produced by capitalist production.
Again, this begs the question. One need not believe this given what Marx
wrote. I give at least one alternative interpretation consistent with
Marx's writing, which Fred has not addressed. In any case the consequence
of my critique is unaffected.
>Contrary to Gil, Marx is NOT trying to prove that capitalist production is
>the only possible source of surplus-value.
And I'll again repeat, this is a misrepresentation of my argument.
> This question is not addressed
>at all by Marx in these chapters. Rather, Marx was trying to prove that
>the only possible source of surplus-value WITHIN THE CAPITALIST MODE OF
>PRODUCTION is the purchase and consumption of labor-power.
First, let's be careful here. If what is meant by the latter phrase is
specifically the purchase of labor power *sold as a commodity* and its
subsequent consumption, that is essentially synonymous with capitalist
production. No other form of production involving the purchase and
consumption of labor power *as a commodity* is mentioned by Marx. If this
is right, and if Fred takes capitalist production to be a necessary
component of the capitalist mode of production (rather than a strategic
variable as in my interpretation), then Fred's statement above effectively
reads "Marx was trying to prove that the only possible source of
surplus-value given capitalist production is capitalist production," which
is circular. Second, if this sentence is *not* to be read as circular,
then Marx's conclusion is invalid, because it doesn't rule out the
possibility of surplus value via usury or merchant's capital extended to
value producers, within a system of (typical rather than universal)
capitalist production.
In this way,
>>Marx demonstrated the INTRINSIC AND NECESSARY CONNECTION between the
>appropriation of surplus-value in capitalism and the existence of
>labor-power in capitalism.
Ah, I see. The issue behind my critique is not, has never been, the
connection of surplus value to "the existence of labor-power in
capitalism." This is completely beside the point. *Of course* surplus
value requires the exploitation of labor power, which is just the capacity
to labor: surplus value requires surplus labor by definition, and surplus
labor requires the capacity to labor by definition. That's *never* been in
question.
At issue is Marx's explicitly more narrow focus on the purchase (and
subsequent consumption in the framework of capitalist-controlled
production) of labor power *as a commodity*. This focus is more
problematic, and is the basis of my critique. It doesn't follow from the
premises mentioned by Marx in Ch. 5, unless, following Fred's
interpretation, one of those premises is--what? the purchase and
consumption within capitalist production of labor power as a commodity--in
which case the argument is necessarily circular.
> In other words, Marx demonstrated the
>NECESSITY of wage-labor in a capitalist economy on the basis of his
>fundamental value theory. Wage-labor is necessary in order to produce
>surplus-value.
But there's the rub. That's just what he *did not* demonstrate, and cannot
have demonstrated, unless by assumption. The point of my critique is that
it's impossible validly to establish the necessity of *wage labor*, an
aspect of capitalist production, for the production of surplus value, on
the basis of value-theoretic categories, unless you first assume the
necessity of wage labor, per Fred's interpretation. To assert otherwise is
like saying you can demonstrate the texture of corduroy on the basis of the
theory of logarithms. The two things have nothing intrinsic to do with
each other. Fred's response to my critique to date cannot possibly
establish otherwise, because to this point he has either mischaracterized
or completely ignored key elements of the critique. Fred is thus simply
reproducing the fallacies in Marx that I criticize!
>Gil says that such an argument is a "tautology". But it is not a
>tautology. It is a deduction. The conclusion (the necessity of
>labor-power) follows from the fundamental assumption of Marx's value
>theory (that value is produced by labor).
Again, the necessity of exploiting *labor-power* as the basis for surplus
value is not, and has never been, the point of my critique. This statement
is utterly beside the point.
>No other economic theory is able to explain the necessity of wage-labor in
>a capitalist economy on the basis of its fundamental value theory.
There's a huge amount packed into this statement, so that a complete
response to it would take too long. So I'll just give the highlights and
we'll see where the discussion goes from there.
1) First, it should not be assumed that because I'm criticizing one aspect
of Marx's theory that I'm denying the validity or relevance of every aspect
of his theory. Quite the contrary.
2) One interpretation of Fred's statement above is the valid insight
embodied in the "Fundamental Marxian Theorem," which states that the rate
of profit is positive if and only if the rate of exploitation is positive.
But the validity of this statement does not depend in any way on the
connection between commodity prices and values, and it most emphatically
does not depend on the existence of wage labor, that is, the purchase of
labor power *as a commodity* and its consumption in capitalist-controlled
production.
3) If the key word in Fred's statement is "labor," then the claim is
fairly uninteresting. Economists working in other frameworks will readily
grant that a necessary condition for production, and thus production of
profit, and thus capitalism, is labor, but deny that this is the key point
to make about the nature of profit. As Roemer has shown, though, any valid
statement one can make about the basis of capitalist profit in terms of
labor value theory, one can establish using a neoclassical market model.
4) If the key phrase in Fred's statement is "wage labor," meaning the
purchase of labor power *as a commodity* and its consumption in
capitalist-controlled production processes, the statement is false: there
is another theory that explains why capitalist exploitation would have to
take *this* form, rather than through usury capital (as in the case of
production loans to family farms) or merchant capital (as in the
putting-out system). That is the mainstream theory of exchange under
conditions of incomplete markets (which appears in a number of guises,
including transaction cost theory, the theory of incentives and
information, principal-agent theory, efficiency wage theory, etc.)
Conversely, if you do not give an analysis that *translates* into a story
about market or contractual incompleteness, you can't *possibly* explain
why capitalist exploitation must take the *specific* form of capitalist
production based on wage labor, rather than, say, the other circuits of
capital just mentioned. **The reason for this is that capitalist control
of production is a strategic *response* to the difficulties in exploiting
workers posed by some form of market or contractual incompleteness.**
5) Of course, I'm not suggesting by the above that Marx was wrong because
he didn't do efficiency wage theory. To the contrary, the "second half" of
my Ch. 5 critique, which I haven't been able to get to because I'm still
responding to challenges on the first half, is that Marx's *historically
contingent* analysis of the class conditions for capitalist exploitation
(presented in a body of work beginning with the Grundrisse and extending
through the Ec Manuscript of 1861-63, the Resultate, and V. III of
Capital), although not fully spelled out, *anticipates* key aspects of the
theory of market incompleteness mentioned above. **But *this* is the story
one must tell to account for the role of wage labor in capitalist
exploitation; contrary to Marx's representation in Ch. 5, the connection
between commodity prices and values has nothing to do with it.**
> In
>neoclassical economics, the "labor market" is introduced as a "factor
>market" after the theory of "product markets". No explanation is given of
>the necessity of "labor" on the labor market. It is just taken as
>given.
Yes it because, because purely as a *historical* matter neoclassical theory
was intended to explain different things. But as a *logical* matter, the
valid core of Marx's results could be established just as fully with
neoclassical tools. All that is necessary to make them commensurate for
the purpose Fred mentions here is to make explicit that production of
commodities requires labor.
> The existence of "labor" on the labor market is not explained in
>any way by the fundamental neoclassical value theory. Wage-labor is a
>contingent, not necessary, feature of capitalist economies.
See above.
>Therefore, Marx's demonstration of the necessity of wage-labor in a
>capitalist economy on the basis of his value theory in Part 2, far from
>being a failure as Gil says, is a significant achievement compared to all
>other economic theories.
Again, I don't ever deny that Marx's theory made significant achievements.
But he did not validly establish "the necessity of wage-labor in a
capitalist economy" on the basis of his arguments in Ch. 5 (and before) and
Fred has not yet fully engaged my critique that demonstrates this.
>Therefore, I conclude that Gil's criticisms of Marx's logic in Part 2 are
>not valid. They are based on misunderstandings of what Marx was trying to
>accomplish in these chapters.
And as I've shown here and in a previous post, this charge of
"misunderstanding" is based on a fundamental misrepresentation of what I've
actually argued, including leaving out key chunks of the critique.
>
>In Chapter 5, Marx was not trying to prove that surplus-value must be
explained on the basis of the exchange of equivalents;
But I don't know how Fred concludes this, since that is exactly what Marx
announces as part of his "double result" at the end of the chapter.
rather Marx was
>drawing out an important implication of the "previously derived law" of
>the exchange of equivalents - that surplus-value cannot arise from
>exchange alone (as a critique of the "profit through exchange" theories of
>his time).
I've already addressed this. See my previous post.
>In Chapter 6, Marx was not trying to prove that capitalist production
>is the only possible source of surplus-value;
I didn't say he was.
>rather Marx was
>demonstrating that the only possible source of surplus-value within the
>capitalist mode of production is the purchase and consumption of
>labor-power, thereby demonstrating the necessity of labor-power in a
>capitalist economy.
This is necessarily either a non sequitur or a tautology, as I've
established via arguments that Fred has not yet addressed.
>
>Thus, Gil has attributed to Marx questions and tasks that are not Marx's
>own, and then criticizes Marx for failing to answer Gil's questions.
>NO FAIR !!
"NO FAIR"....? As mentioned in the previous post, since Fred has
fundamentally misrepresented my critique in both this and the previous
post, I think that charge could with at least equal justice be reversed.
But my assessment of what are "Marx's own" questions, unlike Fred's, are
taken from what Marx actually said, rather than ex post and unproveable
assessments about what is or isn't Marx's "main point" in Ch. 5.
> In terms of Marx's own questions and tasks in these chapters,
>his logic is completely valid.
Sorry to be obstinate about this, but it isn't, and Fred has not yet
engaged the argument that establishes this.
> Circulation by itself does not produce
>value.
Of course that's true; it follows immediately from the definition of
surplus value as involving "valorization." This statement does not validly
imply Marx's concluding inference in Ch. 5, however, contrary to Marx's
quite explicit claim.
> In order to appropriate surplus-value within capitalism,
>money-bags must purchase labor-power.
If "within capitalism" means "within a system in which the purchase of
labor power as a commodity and its consumption within capitalist-controlled
labor processes is taken as a given", this statement is circular.
Otherwise it's a non sequitur; capitalists must *gain access* to labor
power, of course, but *based on the conditions validly established by Marx
at the beginning of Ch. 6*,this can be done equally well via usury capital
(the interest on production loans to small farmers, e.g.) or the
putting-out system (the difference between the piece rate paid to putting
out workers and the market value of their product). Neither of these
alternatives involve the purchase of labor power *as a commodity*, the
specific inference Marx draws at the beginning of Chapter 6.
>I look forward to further discusssion.
So do I. But Fred, I'm wondering on the basis of the preceding if you and
I define "labor power" or "wage labor" in fundamentally different ways. Gil
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