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Hah, I went to the library to find in the RRPE, vol 32, no 2 Fred's
critique of the new solution. I am submitting more comments here. They are
not just intended for Fred.
1. Now one way Fred may have already answered my objection is to say that
price of the means of production determines the constant capital invested,
not the value of those means of production which plays no role in his
reconstruction of Marx's transformation, though Marx does indeed refer to
the value of the means of production going into the output commodities That
is, his argument depends on separating constant capital from the value of
the means of production.
Yet if a capitalist purchases a waterfall as a source of energy, that
would then be constant capital according to Fred which transfers *value* to
some final product.
But that would then mean that something other than even indirect labor has
entered into the value of the final product , thereby undermining the labor
theory of value since value would no longer represent indirect and direct
labor per se but merely the labor value of the money laid out for machines,
raw materials and even pure gifts of nature plus direct labor. It seems to
me that non labor is getting in there.
But more importantly if constant capital were equated with the labor value
of the money needed to purchase means of production, c could never be
dynamically redetermined as the socially necessary labor time to produce
the means of production is reduced or increased over the course of its
amortization. So it seems to me that Fred's set of definitions won't be
able to deal with any real problems in dynamics, though it seems to me that
it has been Fred who has argued that c should be defined in replacement
terms. Of course I agree that cost price remains a datum.
2. I agree of of course with Fred that the initial givens are in the form
of money capital; otherwise why would have Marx referred to cost PRICE?
3. On that basis, I agree that "the magnitudes of constant capital and
variable captial are not first determined as the values of the means of
production and wage goods, and then later transformed into the prices of
production of the same means of production and wages goods as in the
Sraffian interpretation."
As I have said many times, it is exactly because the givens are in money
that the means of production need to be transformed into values--the exact
opposite of the dominant misinterpretation of Marx. In correctly saying
that they don't need to be transformed one way way (=>prices of
production), Fred is also claiming (wrongly I believe) they don't have to
be transformed the other way (=>values) which again should have no effect
on the calculation of the average rate of profit and production prices as
long as we are assuming the labor theory of value, viz that total prices
was determined by total value produced in the prior period as well.
4. However, I agree with Grossmann that the reason Marx is not looking for
such a 'simultaneous' solution is that in the transformation tableaux Marx
has dropped the assumption of constant value (or price) built into the the
simple reproduction scheme which was developed at much greater remove from
reality (other assumptions include exchange at value and annual
turnover--note how Marx also relaxes this through his used up capital
column which differs from constant capital as such).
It is not only that the inputs already have prices that we do not need a
Sraffian solution to determine them on the basis of data within the period.
It is also because Marx in greater respect to the reality on which he is
approximating is now allowing the unit output prices to differ from the
unit input ones.
Alan F, Andrew and Ted, Murray, Paolo G, Carchedi have correctly questioned
the assumption of constant value (or price) but they have not explained why
Marx accepts it in the reproduction schema but not the transformation
tableux. Sweezy thinks a condition in the former needs to be met in the
latter--he has reified an assumption made for purposes of cognitive
tractability.
The source of the mistake was already explained in 1932 by the person
whose method of successive relaxation of assumptions Sweezy claimed to be
appropriating! Only if it were so!
Note that neither Sweezy nor Duncan ever actually justifies why the
transformation tableux should indeed be conjoined to the reproduction
schema given the assumptions that are built into the latter. Should all of
them be accepted? But Marx relaxes annual turnover. Well then why is it not
asked what other assumptions he is dropping? Shouldn't we pay some
attention to Marx's method in Capital!
As John E knows, Grossmann extirpated simultaneism in 1932 (and don't tell
Andrew because he already has to deal with the fact that Dunayevskaya's
'breakdown' understanding of Capital in Marxism and Freedom is just
vulgarized Grossmann whom she did not even have the courtesy to cite in
even a footnote) .
Yaffe is the only one I know who recognized his debt to Grossmann when
pointing to the confusion in the levels of abstraction in the
Bortkiewicz-Sweezy tranformation problem; unfortunately Yaffe only noted
the point superficially, perhaps because he had not grasped Grossmann's
point yet. I may not be doing much better, but greater talent will take my
lead.
And I think Fred's focus on the macro and micro levels of abstraction is
missing the real confusion in abstraction or Bort's collapse of two models
(reproduction and transformation) at different levels of approximation to
reality.
At any rate, how are Howard and King justified in dismissing Yaffe as a
dogmatist without even inquiring in what all this confusion about levels of
abstraction is all about? They doubtless read Grossmann's early 30s pieces,
yet they do not even note in the most superficial way G's objection to the
Bort schema on which the bourgeois attack on Marx latched after Bohm had
been outdebated by Hilferding, Bukharin, Boudin and Blake.
The mistake of these great thinkers was not to anticipate how a critique
based on so many misunderstandings could ever become with the sanction of
the Anglo American's leading marxist a lethal weapon. They also did not
anticipate how most of their theoretical heirs would be confounded by such
a thing. One only wishes that Bortkiewicz was remembered today for what
Blake claims was his greatest accomplishment--his withering critique of
Bohm's agio theory. Has anyone read this?
4. I have already expressed at length my objection to Fred's formulation
here: " even if the cost price of the means fo production is not equal to
the value of the means of production, it is this cost that is taken as
given (a 'given precondition'" in the determination of value and surplus
value." I agree that cost price is a datum, a given precondition...but the
cost price of the means of production does not determine the value they
transfer in their respective branches of production. See arguments in 1.
Yours, Rakesh
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