The Real Movement

Communism is free time and nothing else!

Tag: labor power

July 30, 2015

How Keynes’ smuggled Marx’s concept of labor power into his General Theory

In chapter 4 of his General Theory, Keynes is looking for a quantitative unit of measure that reflects his subject of inquiry: what determines the level of employment? He was looking for a unit of measure that was, in his words, “appropriate to the problems of the economic system as a whole”.

When I first read this statement, I was confused, since it seemed obvious to me that the currency was the unit of measure in bourgeois economics. In this sense, I thought, bourgeois economics differed from labor theory, because the latter’s unit of measure is some definite weight of a commodity money. Since bourgeois political-economy rejects the notion of value, I assumed it was left with only the currency.

It turns out that I was wrong. Keynesian economics does not use the national currency as its unit of measure at all. The reality is much more interesting.

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July 6, 2015

A proposed outline for Professor Varoufakis’s next book

This tweet just crossed my timeline:

Now he has resigned @yanisvaroufakis can get back to what really matters, heterodox microeconomics ( via @McCaineNL )

Nov_1948_strike_negotiations_AAD-5595The reference is to the post-referendum resignation of the wildly popular finance minister of Greece, Yanis Varoufakis. I guess he is supposed to get back to churning out stale academic writing no one reads because this is so much more important than discussing how his approach — fixing capitalism — worked in practice.

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August 2, 2014

V: How Peter Jones demolished Andrew Kliman’s book in 22 brief pages

Does the collapse of the gold standard and the switch to commodity money have any implications for labor theory? The Brazil labor theorist, Paulani argues it does not:

“when, historically, the umbilical cord that linked the money form to the commodity form was cut (in 1971), the dollar value of goods shifted in relation to other currencies, but they kept between themselves the relations which their labour values (prices of production) produced earlier, backed in gold…”

According to Paulani, then, the prices of commodities may have no longer been convertible into gold after 1971, but they did not shift relative to each other. If, before the collapse of the gold standard, four candy bars exchanged for one pair of teatssocks, this much remained unchanged afterwards. Whether this is true is not the point, since, stated in this simplistic form, it can easily be disproven; however, many such changes can be written off to supply and demand “shocks” of one sort or another. Since any such shock is accidental, Paulani’s argument can be reduced this: whatever change did occur, they were accidental and did not result from the collapse of the gold standard. In fact, since relative prices fluctuated constantly even before the collapse of the gold standard, this is a reasonable explanation.

However this argument by Paulani in her 2014 paper is directly challenged by Peter Jones in his 2013 paper, The Falling Rate of Profit Explains Falling US Growth”. Jones argues the collapse of the gold standard directly explains the difficulty labor theorists are having substantiating Marx’s falling rate of profit thesis.

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July 30, 2014

IV: Simon Mohun’s unproductive effort to identify productive labor

As I explained in my last post, substantiating Marx’s falling rate of profit as the cause of capitalist crises, and, in particular, as the cause of the so-called great financial crisis of 2008, runs into the difficulty that Marx made his argument on the basis of values. The difficulty this poses for analysis is that, since 1971, the various categories of analysis employed in measuring the rate of profit are denominated in inconvertible fiat dollars. Fiat dollars are not money in themselves, but tokens — 2007-10-20-77368474placeholders — for commodity money. Prices denominated in this inconvertible fiat, therefore, are not values in the sense Marx employs this term throughout Capital.

Thus, in order to construct an empirical proof of Marx’s thesis on the causes of capitalist crises using the empirical data, labor theorists are forced to convert inconvertible fiat prices into Marxian values. This is a new problem that did not exist before the period between 1933 and 1971 when the gold standard began to come unraveled. Since the dollar was pegged to some definite quantity of gold, dollars prices represented some definite quantity of gold as well. After the collapse of Bretton Woods in 1971, however, this relationship was severed and the dollar’s exchange rate with gold was allowed to float.

The question immediately arose whether Marx’s theory applied in the case where the currency used in daily transactions no longer had any fixed and definite relation to commodity money. Since the quantity of fiat in circulation has always been determined by the state, not by the values of the commodities in circulation, was it not the case that the socially necessary labor time required for production of commodities (value) no longer determined how a capitalistic economy functioned?

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May 23, 2014

Prices, Profit and the Sraffian “One-Commodity” Corn Model

A drop in the rate of profit is attended by a rise in the minimum capital required by an individual capitalist for the productive employment of labour; required both for its exploitation generally, and for making the consumed labour-time suffice as the labour-time necessary for the production of the commodities, so that it does not exceed the average social labour-time required for the production of the commodities. Concentration increases simultaneously, because beyond certain limits a large capital with a small rate of profit accumulates faster than a small capital with a large rate of profit. At a certain high point this increasing concentration in its turn causes a new fall in the rate of profit. (Karl Marx, Capital, Volume 3, Chapter 15)

The problem of prices and profit and of the relation between the two, which has bedeviled the simpleton economist for two hundred years, has reared its ugly head again in a series of posts amounting to a food fight among bourgeois silverqueensimpletons. The question raised in the exchanges, which I have previously covered here, involves the question of the source of profits in the capitalist mode of production and the interrelation between profit and prices.

At stake is far more than is apparent in the obscure criticism raised by heterodox economists against the mainstream neoclassical school that the neoclassical school wants to determine profit by the marginal productivity of capital, and then calculate the quantity of capital in part by asking how profitable it is to own the capital goods. If prices and profit are dependent on each other in this way it calls into question the historical trajectory of the mode of production itself.

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April 30, 2014

Anselm Jappe and the end of the wertkritik school?

JappeI might turn out to be wrong, but based on my reading of Anselm Jappe’s “Towards a History of the Critique of Value”, I think wertkritik has encountered its limits. In the essay, Jappe shows that all you can get from wertkritik is an ever longer laundry list of dumb shit that will go when labor goes. This effort played a crucial role historically by challenging Marxism in all of its varieties, but it cannot do what we need right now — indicate a path forward.

Jappe states wertkritik has refused to come up with practical actions based on its methodology, but this is a specious argument: What he should have said is what the critics say themselves: wertkritik cannot provide a practical guide to action.

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April 27, 2014

How the basic income scheme could become the Left’s worst nightmare

So, let’s do a thought experiment just for the hell of it.

WARNING: This exercise is definitely not recommended for the fainthearted nor for those trapped in the social democratic delusion that the fascist state is a neutral field for competition between classes:

generation-basic-income-1024x682In my last post I asked if basic income can be employed to maintain wage slavery in face of chronic overproduction of capital. I explained, in this regard, the fact the basic income was incompatible with wage slavery has no place in the discussion, because chronic overproduction itself is already incompatible with wage slavery.

This means chronic overproduction itself should have already brought down wage slavery whether a system of basic income existed or not. Given this fact, the task is to explain why chronic overproduction did not bring down wage slavery and how  the capitalists managed to prevent this from happening.

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April 25, 2014

When Charles Murray met David Graeber

charlesmurrayOne of the great difficulties Leftists who support the idea of basic income have is trying to explain why some of the most notorious Rightists in post-war United States have, at one time or another, embraced this idea themselves.

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March 24, 2014

Notes on the essay, “The Logic of Gender”

 Endnotes has published an essay that purports to correct Marx’s “deficient” discussion of the reproduction of labor power. Admittedly, I am not by any means an authority on many of the issues discussed, so I confine myself to matters on which I feel qualified to comment.

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March 8, 2014

How superfluous labor time creates inflation

Dollarpurchasingpower

The purchasing power of one dollar, as measured in percentage of an ounce of gold. (1970-2012)

I want to turn to the question of the impact of the growing mass of superfluous labor time has on the exchange value and prices of commodities. Once i am finished, I hope you will understand why inflation is not a mystery — and, consequently, why all inflation within the mode of production can be traced to the growing mass of unproductive labor.

As I explained in the previous post, the emergence of a significant mass of superfluous labor time within the mode of production is the result of the tendency toward overproduction of commodities, of overproduction of capital in the form of commodities.

According to Marx in Volume 3 of Capital, this overproduction necessarily results in the devaluation of capital: At the point where overproduction of capital becomes a general condition of the mode of production, no increase in the mass of capital can add to the mass of profits; indeed, the possibility exists that an increase in the mass of capital actually results in a fall in the mass of profits.

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