In OPE 3895, Jerry wrote:
Quoting me:
A reply to John's [OPE:3894]:
You somehow are able to state that "In extremis, this could mean s = 0."
Why stop at 0? You assure us that s is 'not' negative. Why is it not? If
capitalists advance $100 and end up with $90, how could s be greater than
or equal to 0?
He then comments:
Surplus-value must be *transformed* into profit. Simply because s is
produced, it does not mean that it will be realized.
If capitalists advance $100 (for c + v) and if they end up with $90 this
will count as a loss, to be sure. But, a loss of *what*?
John responds:
A loss of capital. Note that in Marx's formulation, M-C-M', here M > M'
and hence delta M is negative. For positive surplus value to exist delta M
must be positive. For negative surplus value to exist, delta M must be
negative. This seems to make sense. What is the difficulty in saying that
surplus value can be negative?
Jerry continues:
Surplus-value, like c and v, can not be negative because they are not
*by themselves* ratios. Of course, v *must be* greater than 0 :-). But, s
can equal 0.
John responds:
What does this mean -- "Surplus value, like c and v, can not be negative
because they are not 'by themselves' ratios."?
Must a variable be a ratio to be negative? I'm a bit lost.
Quoting himself, Jerry continues:
(2) there could be an extreme reduction in the value of commodities
produced (output) due to hyperinflation. Profitability could be negative,
then, as the cost of inputs (c + v) increases.
To which I had asked:
How does hyperinflation reduce the value of commodities?
Jerry answered:
Inflation can raise the costs of c + v for capitalists. As the costs of
production for capitalists increase, profitability would decline (unless
they are able to increase the market price of the commodities that they
sell by a rate at least equal to the rate of inflation).
I stated:
It now seems clear that you determine the value produced without any
reference at all to money.
Jerry remarked:
Clear to you but not to me.
I now add:
OK. Let's see if I can be clearer. If I advance $100 and receive $110, I've
made $10. What you seem to be saying is that if inflation is taking place, my
costs might have been $120 if I were to price inputs using the prices outputs.
Hence, I have a nominal profit of $10; but with the simultaneous pricing of
inputs and outputs, I would suffer a loss of $10. To track this process out
we would need to keep going and agree to some definitions of terms like
profitablity and the rate of inflation.
Jerry then states, quoting me:
Hence, we can have negative profits and
positive surplus value.
and he remarks:
I haven't discussed that case.
I now add:
Ok. What you seem to be saying is that with negative profits, surplus
value can equal 0. Can it be positive as well, given negative profits?
Let's discuss.
I then asked:
Yet, if workers consume more than they produce, is
not surplus value negative?
To which, Jerry responded:
Suppose in time t, capitalists advance $100 for v and $100 for c, but
receive after sales a total of $90. In that case, they would have advanced
$200 but only received $90 back. Would this be a case of negative surplus
value? No, because there is no s. Their profit would then be negative yet
their s would be 0.
I now remark:
I don't get it. Why is s=0 in your example? Why is it not negative?
Granted there is no positive s, but s would equal 0 if from your
advance of $100, you got only $100 back. Here, you get less than $100, or
$90, and still you maintain that s=0. Again, I do not get it.
Quoting me, Jerry continues:
In (6), you seem to want to
separate losses in constant capital from the production of surplus value.
Indeed, I think this is the heart of the matter.
He then states:
Remember that I was dealing with natural disasters and social disasters
(e.g. wars). Suppose that the value of c in time t equals $100. Along
comes a typhoon in time t + 1 and the c is washed out to sea. What happens
to the value of that c? It is lost at sea. Although the s *produced*
hasn't been affected, the ability of c to transfer its value has been
reduced. In that case, profit would decrease because the value of c has
been "lost." Even if one accepts the idea that value is conserved *in
exchange*, that doesn't mean that it can't disappear afterwards even
though its use-value hasn't been wholly consumed.
But that returns us to the question of moral depreciation, does it not?
I now add:
Well, I do agree we seem to have some sort of depreciation in your example.
You seem to say that surplus value is produced even in cases where
delta M is negative or where M > M'. Hence, I am not at all clear that
you would agree that surplus value can be negative. Perhaps we're back
to your ratio thing (See above.).
John