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>For what it is worth, I think I completely agree with Fred's formulation
>and don't understand Gil's and Ajit's objections. Gil's appears in
>_Science and Science_ in a condensed (he tells me) but I haven't had an
>opportunity to get it from our library.
Paul, it's probably not useful to lump Ajit and me together, since we're
saying different things and apparently don't agree with what each other
says. Now, as for your agreement with Fred's formulation, I've argued that
Fred really hasn't engaged my argument yet--indeed he's left out the pieces
that most directly respond to his comments--but I can easily understand why
you find his affirmation of Marx's analysis compelling. Obviously Marx's
argument seems highly plausible; if it didn't, there would be no purpose to
a critique, since everyone would already agree about what's wrong with it.
But as for the condensed version of my critique, let me save you a trip to
the library:
Assume for a moment that in his Chapter 5 argument Marx *does not* take as
given that capitalist exploitation is based on capitalist production; in
line with Fred's interpretation, I'll consider the implications of
reversing this assumption below. Now:
1) Marx concludes Chapter 5 with the claim that surplus value has to be
explained "in such a way that the starting point is the exchange of
equivalents," that is, the condition that all commodities exchange at their
respective values. He then uses this conclusion explicitly at the
beginning of Chapter 6 to justify the inference that in order to
appropriate surplus value capitalists *must* (Marx's term) purchase labor
power *as a commodity* and extract its use value, labor, to the extent of
yielding surplus labor. Thus, if Marx's conclusion at the end of Ch. 5 is
invalid, his inference at the beginning of Ch. 6 is invalidly derived.
2) Marx advances a direct and an indirect argument for the conclusion that
surplus value has to be explained on the basis of price-value equivalence.
The direct argument is that this conclusion follows from the fact that
price-value disparities *taken alone* cannot account for the existence of
surplus value:
"The reader will see from the foregoing discussion that the meaning of this
statement [the chapter 5 conclusion mentioned above] is only as follows:
the formation of capital must be possible even though the price and value
of a commodity be the same, for it cannot be explained by referring to any
divergence between price and value." (p 269)
A)First, the statement that price-value disparities in exchange cannot *of
themselves* account for the existence of surplus value follows immediately
from the definition of surplus value as "valorization" of value, i.e. the
creation of new value rather than mere redistribution of existing value.
Creation of new value presupposes production, and exchange is obviously not
production. So you don't really need an entire chapter to make this point.
B) Second and more critically, all this point establishes logically is that
price-value disparities do not constitute a *sufficient* condition for the
existence of surplus value. *This leaves entirely open the question of
whether price-value disparities might be a *necessary* condition for the
existence of surplus value. Without addressing this additional question,
it is *logically impossible* to reach Marx's categorical conclusion at the
end of Ch. 5. So even if I go no further, I've established the invalidity
of this part of Marx's argument.
C) But the significance of this point is more than one of abstract logic.
Marx stipulates *2* conditions for the existence of surplus value in Ch. 5.
First, new value must be created; call this condition "value creation"
[VC]. But second, capitalists must *appropriate* a portion of this newly
created value via a circuit of capital. This is the point of Marx's
analysis of the commodity owner who turns leather into boots and sells the
result (p. 268, Penguin ed.) Surplus value only happens when the
capitalist, not the immediate value producer, appropriates newly created
value. Call this latter condition value appropriation [VA]. **Marx's
argument about price value disparities only applies to the condition of
value creation, not the condition of value appropriation.** Consequently
his argument is logically incomplete *by his own specification of the
subject under investigation.*
D) But this argument has *historical* substance as well. If universal
dependence of capitalist exploitation on capitalist production is not
*assumed*, then surplus value can also be appropriated by forms of usury
and merchant capital extended directly to value producers (and thus
involving VC), as in the case of production loans to family farms or the
putting-out system. **But both of these alternatives *necessitate*
targeted price-value disparities for the appropriation of surplus value:
in the former case, the divergence between the value of the money commodity
in the form of money capital, and its price embodied in the interest rate,
and in the latter case, the divergence between the value produced by
putters-out and the piece rates they're paid by the capitalist. Marx
explicitly and repeatedly acknowledges these alternative circuits as
vehicles of surplus value (references on request). Alternatively, if these
circuits are *not* understood to involve price-value disparities, then
Marx's inference at the beginning of Ch.6 is invalid.
3) The second, indirect argument for Marx's conclusion is that surplus
value should be accounted for on the basis of price-value equivalence
represents the "pure case of commodity exchange" or equivalently, is the
expression of "the immanent laws of the exchange of commodities." However,
Marx has not established (in Chapter 5, chapter 1, or anywhere else) a
valid basis for this claim. To the contrary, it is generically false: an
economy which yields surplus value is *generically* one in which
price-value disparities arise, so long as we are not taking universal
capitalist production as an explicit *premise* of Marx's ch. 5 argument.
Since I'm offering a condensation rather than the complete argument (see my
response to Allin for that), I'll just mention the following: price-value
equivalence does not correspond to classical "natural prices", or perfectly
competitive equilibrium, or the law of one price, or the "average price" of
commodities net of oscillations; it cannot be justified by the notion that
average commodity prices are "regulated" by values, since one can say with
at least much logical force that commodity values are "regulated" by
prices; and finally, if one does not *presume* universal capitalist
production, the class conditions necessary for the existence of surplus
value understood as rents *generically* create price value disparities;
more precisely, as mentioned above, certain surplus value-bearing circuits
of capital *require* targeted price- value disparities.
Thus there is no sense validly established by Marx that price-value
equivalence corresponds to "the pure case of commodity exchange", and there
are a lot of reasons to believe otherwise.
Alternatively, suppose, following Fred's intepretation, that Marx *assumes*
that capitalist exploitation takes place only on the basis of capitalist
production. *Then and only then* one can justify a sense in which
price-value disparities are merely incidental to the existence of surplus
value, but ***it doesn't matter; given this assumption, the connection
between prices and values is now completely beside the point***. In
particular, Marx's focus on the purchase and subsumption of labor power *as
a commodity* beginning in Ch. 6 follows necessarily from the fact that this
condition has been assumed to begin with! Under this assumption, Marx's
argument looks like this: "assume surplus value is premised on the
purchase and subsumption of the commodity labor-power. Then price-value
correspondence can be considered the pure case of commodity exchange. But
then, on this basis, capitalists must purchase and subsume labor power as a
commodity in order to appropriate surplus value." This is circular!
Thus, Marx's argument is either circular or a non sequitur.
Gil
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