Well there is no Christmas for Jains, so I'll break the holiday silence. I am an atheist anyway. Gil, you have caught me in a logical contradiction, to be sure, though you have been kind of enough to drive the point home (though please feel free to do so, i certainly don't want to be stuck with an interpretation or a theory which is fatally logically flawed--this is why i have sought every criticism of Ajit and Allin on the transformation issue; they both seem focused now not so much on the failure to transform the inputs but Marx's failure to include the money commodity, while I have argued that much like Newton assumes an inertial frame of reference, Marx holds constant the value of and labor commanded by the unit of account throughout the three volumes of *Capital*, thereby ensuring that all changes in price are due to changes on the commodity side of the exchange relationship--this last point Grossmann emphasized). As for our debate, I have argued two contradictory things, so I do need to stick to one position as you have rightly said. I would agree with you that in your merchant capital case there is indeed surplus value for the mercant capitalists even though the sum of value has not been increased through this circuit. As I have quoted Marx, he himself underlines this possibility, but argues that if we first explain how the sum of value in circulation itself increases, then we will see how modern merchant capital is derived from this newly produced sum of surplus value. So there are two definitions of surplus value: one is the difference M' minus M in *the circuit of capital*, as you have rightly insisted, and this does not require the production of more value (this is also the definition I have used in my debate with Allin over the transformation problem); the other definition of surplus value--which I think is the more important one in chapter 5--is simply a greater sum of value at t+1 in the *system as whole* than at t. You are absolutely correct that given the claim of the nature of the substance of value, the sum of value cannot be greater at t+1 without an additional expenditure of labor, so circulation in itself cannot be the source of surplus value. In his critique of Condillac, I think Marx is trying to show that what circulation does then increase (for it does increase something) is the use values of commodities to their owners, not the aggregate exchange value in circulation. There is indeed something 'analytic' about the claim here, but I read it as a helpful demonstration and reinforcement of the new meanings of the concepts which Marx is developing. I would not dismiss it as mere tautology (hereI think you are being ungenerous); one gets a feel for new meanings exactly by working out 'analytical' truths like this. As I understand Marx, he fully recognizes that capitalists can obtain surplus value in the first sense without an increase in the value in circulation in the second sense. Do you agree that Marx himself notes this possibility in the form of commercial cheating near the end of ch 5? In his theory as a whole--to which I simply don't think you are paying sufficient attention-- Marx is arguing modern merchant (and interest-bearing) capital derives from the additional sum of value produced out of the circuit of industrial capital at t+1. This is nothing more than the ABC's of Marx's theory. Marx's chapter 6 argument is that the industrial circuit of capital can only increase the value in circulation if it is labor power in the form of commodity that free wage workers, qua juridical persons, alienate, instead of their labor time. Out of this increase in the sum of value then modern merchant and interest bearing capital is derived. The demonstration that in modern capitalism that the latter two forms of capital, though historically primary, now derive from industrial capital is what I have suggested is quite pregnant in its implications for the critique of the socialism of fools. There are other implications of this theory of the relationships among the forms of capital. But the great theoretical achievement here is to show how the oldest forms of capital become subordinate forms as commodity production has become generalized. Again the ABC's of Marx's historical dialectics. Do you agree that there is an achievement of great significance here? All the best, Rakesh
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