IT COULD BE A WONDERFUL WORLD (MUSIC VIDEO)

 

Socialism and Resources

 

We are told that it is impossible to have an economy which excludes wages, prices and money, that wages and prices necessarily exist in any economy.

Sorry to say but it is well documented by anthropologists, that there has been many societies which has not involved a monetary economy – in fact some exist even today in isolated parts of the world. Dollars and cents, salary checks, and price tags on goods are not an intrinsic part of the human essence as such statements imply.

 

Simpler is better. 

Jane gives according to her abilities and takes according to her needs. Free access to goods and services denies to any group or individuals the political leverage with which to dominate others. This will work to ensure that a socialist society is run on the basis of democratic consensus.

 

Yet we are still told that working people don’t get screwed because an economy has wages and prices. Workers get screwed because they labour under an economic model whose method of allocation sets wages and prices unfairly and a good allocation system should accurately value goods at the level of their true costs and benefits to society. That is, the prices of the items Jane consumes should reflect their true social opportunity costs.

 

 Marx cautioned – “Instead of the conservative motto, A fair day’s wage for a fair day’s work! they ought to inscribe on their banner the revolutionary watchword, Abolition of the wages system!”

 

According to capitalist economic theory, prices are the means for determining the rational allocation of resources in a money economy. But, in fact, prices are not intended for the purpose of organising production. The function of pricing is to fix costs with a view to making profit. In practice, costing and pricing are ultimately about calculating the exploitation of labour, enabling the capitalist class to live and accumulate capital from the wealth that the working class produces but does not consume. The problem of rationally allocating productive resources in an economy is common to all human societies at least as long as these resources remain relatively limited compared to needs. However, there is no need to assume that this allocation could be effected rationally only through the exchange of resources taking the value -“price”- form.

Labour power, your ability to work, is a commodity that is sold on the open market like anything else, the `price’ you get for it is your wage. If you have special natural skills or a training to perform a particular kind of labour which is in high demand then like everything else you can command a higher price for it, as well as good working conditions.

 

A monetary economy gives rise to the illusion that the “cost” of producing something is merely financial . Money is the universal unit of measurement, the “general equivalent” that allows everything to be compared with everything else under all circumstances—but only in terms of their labour-time cost or the total time needed on average to produce them from start to finish.

Such non-monetary calculation of course already happens, on the technical level, under capitalism. Once the choice of productive method has been made (according to expected profitability as revealed by monetary calculation) then the real calculations in kind of what is needed to produce a specific good commence so much raw materials, so much energy, so much labour.

In socialism it is not the case that the choice of productive method will become a technical choice that can be left to engineers, as is sometimes misunderstood by critics, but that this choice too will be made in real terms, in terms of the real advantages and disadvantages of alternative methods and in terms of, on the one hand, the utility of some good or some project in a particular circumstance at a particular time and, on the other hand, of the real “costs” in the same circumstances and at the same time of the required materials, energy and productive effort.

 

Production-for-use would operate in direct response to need. These would arise in local communities expressed as required quantities such as grammes, kilos, tonnes, litres, metres, cubic metres, etc, of various materials and quantities of goods. These would then be communicated as required elements of productive activity , as a technical sequence, to different scales of social production , according to necessity.

Each particular part of production would be responding to the material requirements communicated to it through the connected ideas of social production. It would be self-regulating, because each element of production would be self-adjusting to the communication of these material requirements. Each part of of production would know its position. If requirements are low in relation to a build-up of stock, then this would an automatic indication to a production unit that its production should be reduced. If the register of needs and the communication of every necessary element of those needs to the structure of production would be clear and readily known. The supply of some needs will take place within the local community and in these cases production would not extent beyond this , as for example with local food production for local consumption.

Other needs could be communicated as required things to the regional organisation of production. Local food production would require glass, but not every local community could have its own glass works. The requirements for glass could be communicated to a regional glass works. These would be definite quantities of required glass. The glass works has its own suppliers of materials, and the amounts they require for the production of 1 tonne of glass are known in definite quantities. The required quantities of these materials could be passed by the glass works to the regional suppliers of the materials for glass manufacture . This would be a sequence of communication of local needs to the regional organisation of production, and thus contained within a region.

Local food production would also require tractors, and here the communication of required quantities of things could extend further to the world organisation of production. Regional manufacture could produce and assemble he component parts of tractors for distribution to local communities. These would be required in a definite number and, on the basis of this definite number of final products , the definite number of component parts for tractors would also be known . The regional production unit producing tractor would communicate these definite quantities to their own suppliers, and eventually this would extend to world production units extracting and processing the necessary materials.

This would be the self-regulating system of production for need , operating on the basis of the communication of need as definite quantities of things throughout the structure of production. Each production unit would convert the requirements communicated to it into its own material requirements and pass these on to its suppliers. This would be the sequence by which every element of labour required for the production of a final product would be known.

This system of self-regulating production for use is achieved through communications. Socialism would make full use of the means communications which have developed. These include not only transport such as roads, railways, shipping etc. They also include the existing system of electronic communications which provide for instant world-wide contact as well as facilities for storing and processing millions of pieces of information. Modern information technology could be used by socialism to integrate any required combination of different parts of its world structure of production.

Simpler is Better

For a fuller explanation see:

How Socialism Can Organise Production Without Money

 

 

Socialists desire to abolish economics. No exchange, no economy.

Socialism, being based on the common ownership of the means of production by all members of society, is not an exchange economy. Production would no longer be carried on for sale with a view to profit as under capitalism. In fact, production would not be carried on for sale at all.

 

 Production for sale would be a nonsense since common ownership of the means of production means that what is produced is commonly owned by society as soon as it is produced. The question of selling just cannot arise because, as an act of exchange, this could only take place between separate owners. Yet separate owners of parts of the social product are precisely what would not, and could not exist in a society where the means of production were owned in common.

 

However, socialism is more than just not an exchange economy; it is not an economy at all, not even a planned economy. Economics, or political economy as it was originally called, grew up as the study of the forces which came into operation when capitalism, as a system of generalised commodity production, began to become the predominant mode of producing and distributing wealth. The production of wealth under capitalism, instead of being a direct interaction between human beings and nature, in which humans change nature to provide themselves with the useful things they need to live, becomes a process of production of wealth in the form of exchange value. Under this system, production is governed by forces which operate independently of human will and which impose themselves as external, coercive laws when men and women make decisions about the production and distribution of wealth. In other words, the social process of the production and the distribution of wealth becomes under capitalism an economy governed by economic laws and studied by a special discipline, economics.

 

Socialism is not an economy, because, in re-establishing conscious human control over production, it would restore to the social process of wealth production its original character of simply being a direct interaction between human beings and nature. Wealth in socialism would be produced directly as such, i. e. as useful articles needed for human survival and enjoyment; resources and labour would be allocated for this purpose by conscious decisions, not through the operation of economic laws acting with the same coercive force as laws of nature. Although their effect is similar, the economic laws which come into operation in an exchange economy such as capitalism are not natural laws, since they arise out of a specific set of social relationships existing between human beings. By changing these social relationships through bringing production under conscious human control, socialism would abolish these laws and so also the economy as the field of human activity governed by their operation. Hence socialism would make economics redundant.

What we are saying, in effect, is that the term exchange economy is a tautology in that an economy only comes into existence when wealth is produced for exchange. It is now clear why the term planned economy is unacceptable as a definition of socialism. Socialism is not the planned production of wealth as exchange value, nor the planned production of commodities, nor the planned accumulation of capital. That is what state capitalism aims to be.

 

Planning is indeed central to the idea of socialism, but socialism is the planned (consciously coordinated) production of useful things to satisfy human needs precisely instead of the production, planned or otherwise, of wealth as exchange value, commodities and capital. In socialism wealth would have simply a specific use value (which would be different under different conditions and for different individuals and groups of individuals) but it would not have any exchange, or economic, value.

 

In socialist society productive activity would take the form of freely chosen activity undertaken by human beings with a view to producing the things they needed to live and enjoy life. The necessary productive work of society would not be done by a class of hired wage workers but by all members of society, each according to their particular skills and abilities, cooperating to produce the things required to satisfy their needs both as individuals and as communities. Work in socialist society could only be voluntary since there would be no group or organ in a position to force people to work against their will.

 

“Socialist production would be production solely for use. The products would be freely available to people, who would take them and use them to satisfy their needs. In socialism people would obtain the food, clothes and other articles they needed for their personal consumption by going into a distribution centre and taking what they needed without having to hand over either money or consumption vouchers. Houses and flats would be rent-free, with heating, lighting and water supplied free of charge. Transport, communications, health care, education, restaurants and laundries would be organised as free public services. There would be no admission charge to theatres, cinemas, museums, parks, libraries and other places of entertainment and recreation. The best term to describe this key social relationship of socialist society is free access, as it emphasises the fact that in socialism it would be the individual who would decide what his or her individual needs were. As to collective needs (schools, hospitals, theatres, libraries and the like), these could be decided by the groups of individuals concerned, using the various democratic representative bodies which they would create at different levels in socialist society. Thus production in socialism would be the production of free goods to meet self-defined needs, both individual and collective.”

from final chapter of State Capitalism: the Wages System Under New Management, by Crump and Buick

 

To advocate monetary calculation, is to advocate that only one consideration—the total average production time needed to produce goods—should be taken into account when making decisions about which productive methods to employ. This is patently absurd but it is what is imposed by capitalism. Naturally, it leads to all sorts of aberrations from the point of view of human interests. In particular it rules out a rational, long-term attitude towards conserving resources and it imposes intolerable conditions on the actual producers (speed-up, pain, stress, boredom, long hours, night work, shiftwork, accidents).

Socialism, because it will calculate directly it kind, will be able to take these other, more important, factors than production time into account. This will naturally lead to different, in many cases quite different, productive methods being adopted than now under capitalism. If the health, comfort and enjoyment of those who actually manipulate the materials, or who supervise the machines which do this, to transform them into useful objects is to be paramount, certain methods are going to be ruled out altogether. The fast moving production lines associated with the manufacture of cars would be stopped for ever ; night work would be reduced to the strict minimum; particularly dangerous or unhealthy jobs would be automated (or completely abandoned).

 

Work can, in fact must, become enjoyable. But to the extent that work becomes enjoyable, measurement by minimum average working time would be completely meaningless, since people would not be seeking to minimize or rush such work.

 

from Why we don’t need money
http://www.worldsocialism.org/articles/why_we_dont_need.php

 

 

How are these needs communicated? What allocation mechanism do you use? Certainly won’t be by getting those individuals needs allotted to them.

 

Decisions involving choices of a general nature, such as what forms of energy to use, which of two or more materials to employ to produce a particular good, whether and where to build a new factory, there is a technique already in use under capitalism that could be adapted for use in socialism: so-called cost-benefit analysis and its variants. Naturally, under capitalism the balance sheet of the relevant benefits and costs advantages and disadvantages of a particular scheme or rival schemes is drawn up in money terms, but in socialism a points system for attributing relative importance to the various relevant considerations could be used instead. The points attributed to these considerations would be subjective, in the sense that this would depend on a deliberate social decision rather than on some objective standard. In the sense that one of the aims of socialism is precisely to rescue humankind from the capitalist fixation with production time/money, cost-benefit type analyses, as a means of taking into account other factors, could therefore be said to be more appropriate for use in socialism than under capitalism. Using points systems to attribute relative importance in this way would not be to recreate some universal unit of evaluation and calculation, but simply to employ a technique to facilitate decision-making in particular concrete cases. The advantages /disadvantages and even the points attributed to them can, and normally would, differ from case to case. So what we are talking about is not a new abstract universal unit of measurement to replace money and economic value but one technique among others for reaching rational decisions in a society where the criterion of rationality is human welfare.

 

Planning in socialism is essentially a question of industrial organisation, of organising productive units into a productive system functioning smoothly to supply the useful things which people had indicated they needed, both for their individual and for their collective consumption. What socialism would establish would be a rationalised network of planned links between users and suppliers; between final users and their immediate suppliers, between these latter and their suppliers, and so on down the line to those who extract the raw materials from nature. There is no point in drawing up in advance the sort of detailed blueprint of industrial organisation that the old IWW and the Syndicalists used to , but it is still reasonable to assume that productive activity would be divided into branches and that production in these branches would be organised by a delegate body. The responsibility of these industries would be to ensure the supply of a particular kind of product either, in the case of consumer goods, to distribution centres or, in the case of goods used to produce other goods, to productive units or other industries.

 

Since the needs of consumers are always needs for a specific product at a specific time in a specific locality, we will assume that socialist society would leave the initial assessment of likely needs to a delegate body under the control of the local community (although, other arrangements are possible if that were what the members of socialist society wanted). In a stable society such as socialism, needs would change relatively slowly. Hence it is reasonable to surmise that an efficient system of stock control, recording what individuals actually chose to take under conditions of free access from local distribution centres over a given period, would enable the local distribution committee (for want of a better name) to estimate what the need for food, drink, clothes and household goods would be over a similar future period.

 

 Some needs would be able to be met locally: local transport, restaurants, builders, repairs and some food are examples as well as services such as street-lighting, libraries and refuse collection. The local distribution committee would then communicate needs that could not be met locally to the bodies charged with coordinating supplies to local communities.

 

The individual would have free access to the goods on the shelves of the local distribution centres; the local distribution centres free access to the goods they required to be always adequately stocked with what people needed; their suppliers free access to the goods they required from the factories which supplied them; industries and factories free access to the materials, equipment and energy they needed to produce their products; and so on. Production and distribution in socialism would thus be a question of organising a coordinated and more or less self-regulating system of linkages between users and suppliers, enabling resources and materials to flow smoothly from one productive unit to another, and ultimately to the final user, in response to information flowing in the opposite direction originating from final users. The productive system would thus be set in motion from the consumer end, as individuals and communities took steps to satisfy their self-defined needs. Socialist production is self-regulating production for use.

 

To ensure the smooth functioning of the system, a central statistical office would be needed to provide estimates of what would have to be produced to meet peoples likely individual and collective needs. These could be calculated in the light of consumer wants as indicated by returns from local distribution committees and of technical data (productive capacity, production methods, productivity, etc) incorporated in input-output tables. For, at any given level of technology (reflected in the input-output tables), a given mix of final goods (consumer wants) requires for its production a given mix of intermediate goods and raw materials; it is this latter mix that the central statistical office would be calculating in broad terms. Such calculations would also indicate whether or not productive capacity would need to be expanded and in what branches.

 

The centre (or rather centres for each world-region) would thus be essentially an information clearing house, processing information communicated to it about production and distribution and passing on the results to industries for them to draw up their production plans so as to be in a position to meet the requests for their products coming from other industries and from local communities. The only calculations that would be necessary in socialism would be calculations in kind. On the one side would be recorded the resources (materials, energy, equipment, labour) used up in production and on the other side the amount of the good produced, together with any by-products.

 

Stock or inventory control systems employing calculation in kind are, as was suggested earlier, absolutely indispensable to any kind of modern production system. While it is true that they operate within a price environment today, that is not the same thing as saying they need such an environment in order to operate. The key to good stock management is the stock turnover rate – how rapidly stock is removed from the shelves – and the point at which it may need to be re-ordered. This will also be affected by considerations such as lead times – how long it takes for fresh stock to arrive – and the need to anticipate possible changes in demand.

 

A typical sequence of information flows in a socialist economy might be as follows. Assume a distribution point (shop) stocks a certain consumer good – say, tins of baked beans. From past experience it knows that it will need to re-order approximately 1000 tins from its suppliers at the start of every month or, by the end of the month, supplies will be low. Assume that, for whatever reason, the rate of stock turnover increases sharply to say 2000 tins per month. This will require either more frequent deliveries or, alternatively, larger deliveries. Possibly the capacity of the distribution point may not be large enough to accommodate the extra quantity of tins required in which case it will have to opt for more frequent deliveries. It could also add to its storage capacity but this would probably take a bit more time. In any event, this information will be communicated to its suppliers. These suppliers, in turn, may require additional tin plate (steel sheet coated with tin), to make cans or beans to be processed and this information can similarly be communicated in the form of new orders to suppliers of those items further down the production chain. And so on and so forth. The whole process is, to a large extent, automatic – or self regulating – being driven by dispersed information signals from producers and consumers concerning the supply and demand for goods and, as such, is far removed from the gross caricature of a centrally planned economy.

It may be argued that this overlooks the problem of opportunity costs .For example, if the supplier of baked beans orders more tin plate from the manufacturers of tin plate then that will mean other uses for this material being deprived by that amount. However, it must be born in mind in the first place that the systematic overproduction of goods that Marx talked of – i.e. buffer stock – applies to all goods, consumption goods as well as production goods. So increased demand from one consumer/producer, need not necessarily entail a cut in supply to another – or at least, not immediately. The existence of buffer stocks provides for a period of re-adjustment.

 

Liebig’s Law of the Minimum – states is that plant growth is controlled not by the total amount of resources available to a plant but by the particular factor that is scarcest. This factor is called the limiting factor. It is only by increasing the supply of the limiting factor in question – eg nitrogen fertiliser – that you promote plant growth. Liebig’s Law can be applied equally to the problem of resource allocation in any economy.It makes sense from an economic point of view to economise most on those things that are scarcest and to make greatest use of those things that are abundant.To claim that all factors are scarce (because the use of any factor entails an opportunity cost) and, consequently, need to be economised is actually not a very sensible approach to adopt. You cannot treat every factor equally – that is, as equally scarce – or, if you do, this will result in gross misallocation of resources and economic inefficiency. The most sensible basis on which to make such a discrimination is the relative availability of different factors and this is precisely what the law of the minimum is all about.When a particular factor is limited in relation to the multifarious demands placed on it, the only way in which it can be “inefficiently allocated” (although this is ultimately a value judgement) is in choosing “incorrectly” to which particular end use it should be allocated . Beyond that, you cannot misuse or misallocate a resource if it simply isn’t available to misallocate (that is, where there are inadequate or no buffer stocks on the shelf, so to speak). Of necessity, one is compelled to seek out a more abundant alternative or substitute .

 

To determine priorities Maslow’s “hierarchy of needs” would be a guide to action. It would seem reasonable to suppose that needs that were most pressing and upon which the satisfaction of others needs were contingent, would take priority over those other needs. We are talking here about our basic physiological needs for food, water, adequate sanitation and housing and so on. This would be reflected in the allocation of resources: high priority end goals would take precedence over low priority end goals where resources common to both are revealed using the earlier discussed “points” system of cost benefit analysis.

 

To sum up, a socialist steady-state equilibrium, will have been reached. Gradual change, growth, will be simple and painless. The task of planning becomes one of simple routine; the role of economics is virtually eliminated.

 

As an aside, was it not Marx who said in communism it is now society’s free (disposable) time and no longer labour time that becomes the true measure of society’s wealth.

Labour Theory of Value and the Green Marx

 

This is a shortened and changed version of an article on Dissident Voice by Robin Cox 

It was actually Lenin taking advantage of the already growing revisionism of the gradualists (then called state-socialists) in the 2^nd International who was primarily responsible for the shift in the meaning of the term “socialism” away from how Marxists had originally defined it as an attempt to garner political support for the Bolsheviks’ state capitalist agenda. Thus, in 1917 Lenin declared that “socialism is merely state-capitalist monopoly which is made to serve the interests of the whole” (The Impending Catastrophe and How to Combat It).  The enormous impact that the Bolshevik Revolution had on world affairs meant that this Leninist definition of “socialism” – identifying it with the activities of a state rather than the stateless society Marx envisaged it to be — came to prevail in popular discourse while the original Marxian definition faded from sight.  Too often critiques that are is supposed to be against Marx, are in fact criticisms of Leninism and not Marxism. In Marxian socialism, goods would be produced solely and directly for use, not for sale on a market, and would be made available to the population on the basis of free appropriation (“free access”).  Needless to say, this presupposes the technological potential to produce enough to meet the basic needs of the population and socialists assert that this potential has long been around (as I will later explain).  We no longer require the “productive forces” to be “increased” (as Marx thought) in order to establish the kind of society he called socialism-cum-communism. All that we need is a working class majority – not some Leninist vanguard acting in its behalf – to consciously and democratically bring this about.

 A logical corollary of “free access” in Marxian socialism, the cooperative labour required to produce the goods we need would take the form of “freely associated” (to use Marx’s expression), voluntaristic, unpaid work where the very notion of “compensation” for work done would completely fall away. Wage labour, or any other form of coerced labour, for that matter (and by “coerced” I mean economic coercion not just physical coercion) would no longer exist since it cannot logically be reconciled with a socialist mode of appropriation based on free access.  The Gordian knot between what one consumes and what one contributes would be severed and the antagonism of interests that this presupposes would cease to apply.

That antagonism is embedded in the very institution of market exchange itself and finds expression in the conflictual relationship between buyer and seller (including the buyers and sellers of labour power). The buyer seeks to secure the lowest possible price for the commodity in question; the seller, the opposite.  So they haggle.  Exchange value is the impersonal market-imposed outcome of this haggling, mediated through the interplay of supply and demand but ultimately responsive to the Marxian law of value. The “law of value” is really only applicable to a society in which commodity production has become generalised and, above all, where labour power has itself been generally transformed into a commodity, not just the products of labour themselves.  In other words, where there is in place a system of generalised wage labour.  In fact, Marx himself treated the term, the “wages system” as a synonym for capitalism as in Capital where he spoke of “capitalistic production, or the wages system” (Vol 1, Ch.1.)

“The wealth of those societies in which the capitalist mode of production prevails, presents itself as “an immense accumulation of commodities, its unit being a single commodity.”  

Marx’s position wast that, though the law of value did indeed predate capitalism, it “develops fully only on the foundation of capitalist production”. (Capital Vol 1.)  Here Marx was alluding to the law of value governing “simple commodity exchange” and the transformation of this law under capitalist conditions where “more labour is exchanged for less labour (from the labourer’s standpoint), less labour is exchanged for more labour (from the capitalist’s standpoint)”. (1863, Theories of Surplus Value, Ch 3. Section 4.)

Thus, what distinguished capitalist from non-capitalist, or pre-capitalist, societies, in Marx’s view, is precisely the fact that most wealth did not take the form of commodities in the latter – that is, it was not produced for sale on the market. Thus the law of value is unique to capitalism. Socialism entails the complete abolition of commodity exchange.  If there is no commodity exchange then the question of exchange value cannot logically arise, in which case it is nonsensical to talk of the law of value applying in socialism.

Those who would argue there is nothing in Marx to prevent the law functioning under any conditions in which workers own the means of production, including socialism and refer to worker cooperatives, they are quite mistaken in thinking this. Marx did not consider co-ops to be an instantiation of “socialism” but, along with the capitalist joint stock company, a transitional form from the “capitalist mode of production to the associated one”.  Though he had positive things to say about co-ops as pointing the way ahead, he saw them, nevertheless, as operating fundamentally within the constraints of capitalism:  “The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system”. (Capital, Vol 3, Ch 27.)

In his Critique of the Gotha Programme (1875), Marx wrote in highly speculative terms of this first phase of communism  thus:

“Within the co-operative society based on common ownership of the means of production, the producers do not exchange their products; just as little does the labor employed on the products appear here as the value of these products, as a material quality possessed by them, since now, in contrast to capitalist society, individual labor no longer exists in an indirect fashion but directly as a component part of total labor. The phrase “proceeds of labor”, objectionable also today on account of its ambiguity, thus loses all meaning.

What we have to deal with here is a communist society, not as it has developed on its own foundations, but, on the contrary, just as it emerges from capitalist society; which is thus in every respect, economically, morally, and intellectually, still stamped with the birthmarks of the old society from whose womb it emerges. Accordingly, the individual producer receives back from society – after the deductions have been made – exactly what he gives to it. What he has given to it is his individual quantum of labor. For example, the social working day consists of the sum of the individual hours of work; the individual labor time of the individual producer is the part of the social working day contributed by him, his share in it. He receives a certificate from society that he has furnished such-and-such an amount of labor (after deducting his labor for the common funds); and with this certificate, he draws from the social stock of means of consumption as much as the same amount of labor cost. The same amount of labor which he has given to society in one form, he receives back in another.”

 Marx’s proposal to institute a scheme of labour certificates to compensate workers for their labour contributio is unnecessary and superfluous inasmuch as we have long moved away from the era of unavoidable material scarcities in which Marx lived and in which he penned this particular proposal as a way of coping with these scarcities in the early days of socialism.  Today such scarcities are no longer unavoidable but, on the contrary, have to be artificially imposed and rigorously reinforced for the sake of the system we all still live under – global capitalism.

Even if a socialist society would initially be handicapped by the problem of material scarcities inherited from capitalism and so would have to institute some form of rationing which is precisely what his labour certificate scheme amounts to. But, even if this was the case, there are other far more effective, and better targeted, ways of rationing scarce goods than the hugely unwieldly approach Marx advocated.

Not only that, the labour certificate scheme proposed by Marx would be bureaucratically cumbersome and wasteful inasmuch as it would require a very substantial amount of administrative labour to operate it and to maintain an appropriate level of labour surveillance for the scheme to work on its own terms. Furthermore, there are intrinsic technical difficulties associated with the scheme such as how one might go about valuing different forms of labour which would make it very difficult to implement.  Also, it is not just people’s labour contributions that would need to be directly measured for the purpose of distributing these certificates; the goods produced by this labour would need to be measured too in terms of the amount of concrete labour time it took to produce them – a truly daunting task given the socially integrated nature of modern production and its incredibly complex division of labour.

Having said that, it is pretty clear from what Marx wrote about this first phase of socialism that he did not envisage the law of value operating within it. For a start, the producers, Marx said, “do not exchange their products” so consequently we cannot possibly be talking about a society in which exchange value exists (and therefore one in which the law of value would apply). There is “exchange” of course – notably the performance of a certain amount of labour in exchange for a certificate — but this is not what exchange value or the law of value is about.  These certificates do not in themselves constitute money since they do not circulate and cannot be used as a means of accumulating wealth.

Moreover – and crucially — it should be noted that what is measured here for the purposes of distributing labour certificates is concrete labour, not abstract labour which, as we saw earlier, is the fundamental metric of value in Marx’s theory.  This fact alone destroys Pena’s absurd claim that Marx envisaged the law of value continuing in socialism.  The worker in Marx’s first stage of socialism receives back in the form of a labour certificate exactly what she has contributed to society in terms of her own labour – not some hypothetical social average.

Marx goes on:

“Here, obviously, the same principle prevails as that which regulates the exchange of commodities, as far as this is exchange of equal values. Content and form are changed, because under the altered circumstances no one can give anything except his labor, and because, on the other hand, nothing can pass to the ownership of individuals, except individual means of consumption.”

So this resembles the exchange of equal values in commodity exchange inasmuch as it involves an equality of exchange — you get back exactly what you contribute to society (allowing for the various social deductions Marx refers to).   But there the resemblance ends since what is happening here is that “content and form are changed”.  This is because it is not abstract labour that constitutes the basic metric of this transaction but concrete labour.

Secondly, there is indeed more than a hint in Marx that workers would be differentially compensated in this first phase of socialism according to the duration and intensity of their contribution:

“But one man is superior to another physically, or mentally, and supplies more labor in the same time, or can labor for a longer time; and labor, to serve as a measure, must be defined by its duration or intensity, otherwise it ceases to be a standard of measurement. This equal right is an unequal right for unequal labor. It recognizes no class differences, because everyone is only a worker like everyone else; but it tacitly recognizes unequal individual endowment, and thus productive capacity, as a natural privilege. ”(Ibid.)

This does indeed entail a hierarchy of sorts but I think Pena grossly exaggerates its likely consequences.  After all, we are not talking about a class-based hierarchy but rather one based purely on one’s work contribution.  As Marx says “everyone is only a worker like everyone else”.  So the hierarchical aspect of this arrangement is likely to be far less pronounced than anything one is likely to encounter in a class-based society where sectional or class ownership of the means of production massively amplifies the asymmetrical distribution of power and status. Moreover, there is nothing to suggest there might not be a significant degree of social mobility within this hypothetical first stage of socialism, as Marx conceived it.  What is to stop individuals moving up this hierarchy by, for instance, undertaking the requisite education and training, thereby boosting their status within the hierarchy?

We also need to take into consideration Marx’s views on the division of labour by which he meant the compulsory division of labour that compels a worker to do a particular kind of job but prevents her from simultaneously doing some other job.  Marx was very much opposed to this. He saw socialism as presupposing or being dependent on what might be called the polytechnic or multi-skilled worker and (rather over-optimistically) speculated that the trend in work patterns in late Victorian Britain was moving in that direction.   He could perhaps be forgiven for not “predicting” the rise of Fordist style assembly production in the early 20th century

Nevertheless, his views on the division of labour likewise help to undermine the claim that what Marx was advocating would result in some sort of rigidly oppressive social hierarchy.  Insofar as workers would be far more free to undertake a variety of jobs, rather than confine themselves to just one kind of job as is normally the case under capitalism.

 All Marx’s speculations concerning this lower or first of phase of communism were predicated on the assumption that the productive forces were not yet fully developed to permit the introduction of full socialism – or more precisely, its higher phase.  Pena talks loosely about the “Marxist conception of socialism” in this connection but this is misleading because in this particular context Marx was only talking about its first or lower phase.  He was not talking about socialism or communism, per se, as Marx himself makes abundantly clear:

“In a higher phase of communist society, after the enslaving subordination of the individual to the division of labor, and therewith also the antithesis between mental and physical labor, has vanished; after labor has become not only a means of life but life’s prime want; after the productive forces have also increased with the all-around development of the individual, and all the springs of co-operative wealth flow more abundantly – only then can the narrow horizon of bourgeois right be crossed in its entirety and society inscribe on its banners: From each according to his ability, to each according to his needs!”

 

In this higher phase the very fact that goods and services would be universally available on the basis of free appropriation is what would deprive any individual or group of the social leverage by which they could exert power over others and coerce them to do their bidding.  Contrary to the claims of anarcho-capitalists and other exponents of the free market, the material basis of a truly free society would be precisely Marxian socialism. Anarcho-capitalists may routinely claim they have no objection to others operating a socialist society, providing they themselves should be allowed to produce for the free market. Well, let us extend this hypothetical possibility to them and see how far they can run with it. How would they persuade others to relinquish the freedom of voluntary associated labour and submit to the economic coercion of wage labour instead? How would they entice them to buy what they had to sell – and with what? – in a society in which what individuals wanted would be available for them to freely take? Free access trumps free markets every time!

Marxian socialism, by contrast, operates according to a completely contrary principle — generalised reciprocity.  Instead of separating out individuals who then confront each as buyers and sellers in the market place with opposed interests, generalised reciprocity brings them together.  It serves to cement the social relationships that bind us to each other.  It highlights our mutual inter-dependence and reinforces our sense of mutual obligation to one another. Marxian socialism is what the anthropologists mean by a “moral economy” in the sense that the transactions between individuals would not simply be self-interested (as in Adam’s Smith mechanistic model of the market) but other-oriented as well – although one might quibble with notion that socialism might be called an “economy” at all.  In fact, the very idea of something called an economy arose out of the emergence of capitalism itself and the identification by Smith and others of a distinct economic realm within society which was subject to certain economic laws pertaining sui generis to this realm.  In traditional pre-capitalist societies, by contrast, the different facets of social life — morality, politics, religion and “economics” — were much more closely intermeshed and one suspects the same would be true of a future socialist society – further grounds, one might add, for rejecting the claim that the Marx’s law of value would operate in such a society.

The emergence of a distinct disembedded economic realm in capitalism was accompanied by, and mirrored in, emergence of distinct concept of the individual as sovereign and free floating – cut adrift from the ties that bound individuals to each other in earlier traditional societies.   It is this market economy of capitalism that atomises individuals and interposes between them the cold nexus of cash payment.  When money mediates everything, our essential human sociality is rendered opaque. We objectify and separate ourselves from our fellow human beings in much the same way as soldiers in a war seek to dehumanise the enemy in order to more effectively liquidate it.

It is this kind of thinking that underlies the idea that workers should be compensated for their work which is really another way of saying that they should be externally coerced and cajoled into working which tells us a lot about the nature of work and by extension the nature of the society we live in that requires its citizens to be thus coerced.  It is nor for no reason that Marx spoke of labour becoming “not only have a means of life but life’s prime want” in higher communism.  Human beings have a fundamental need to creatively express themselves in work.  Though we tend not to call it work under capitalism (where work tends to be equated with employment) it is highly significant that even under capitalism people work more hours without any kind of monetary “inducement” than they do with such an “inducement” and there is ample evidence that so called money incentives can negatively impact on what industrial psychologists call our intrinsic motivation to work.

In Marx’s first phase of socialism the need to compensate workers for their labour in the guise of labour certificates was rationalised on the grounds that in this phase society would still be subject to material scarcity which he envisaged would eventually give way of abundance.  Material abundance is a precondition of Marxian socialism.  Without the technological potential to produce enough to satisfy people’s basic needs, the establishment of a socialist society becomes problematic if not downright impossible. Marx’s labour certificate scheme was predicated on precisely this insight.  In the early days of socialist society he speculated there would be not quite enough to go around to adequately meet the needs of everyone.  It was only when “all the springs of co-operative wealth flow more abundantly” that society could abandon this scheme and move on to implement fully the socialist principle of “from each according to ability to each according to need” – the system of free access and voluntaristic labour we associate with the higher phase of communism.

These speculations on Marx’s part relate to a possible future post-capitalist socialist world.  But the world in which Marx made these speculations was one in which the socio-economic system we call capitalism was still developing and had not yet fully matured.   Indeed, in contrast to today’s global capitalism vast chunks of the world back then in the mid-19th century still remained relatively untouched by the spread of the capitalist market economy.

It was in this context that the 1848 Communist Manifesto’s talked in such glowing terms of the way in which capitalism was developing the productive potential of society. It spoke candidly of the need “to increase the total productive forces as rapidly as possible” precisely because Marx and Engels believed this would hasten the day that a communist society could be established.  That was not an unreasonable argument to make given the circumstances of the times in which Marx was writing.  If the productive forces were not sufficiently developed to allow society to meet the needs of the people the result would be scarcity.  This would unleash a competitive scramble for goods – and greed as the inevitable product of a scarcity mind-set – that would likely undermine the entire communist project even assuming it could even be realised under these circumstances in the first place.

As they put in The German Ideology: “This development of the productive forces is an absolutely necessary practical premise [of communism], because without it want is generalised, and with want the struggle for necessities begins again, and that means that all the old crap must revive.” (1846, Vol 1.)

 Material scarcity is bad news for socialism and bad news for the environment as well.  Yet one gets the distinct impression that many eco-activists scorns the need for a developed infrastructure and the opportunity to take advantage of the best that modern technology has to offer in favour of us all wearing hair shirts. For scarcity is what they are urging us to embrace with all the stoicism of a Buddhist monk.  At least Buddhist monks have the charity of others to fall back upon for their means of subsistence but a whole society cannot depend on this.  But in abandoning the machines we also diminish our productivity and what we are able to produce.

In a small spa town in southern Spain.  The water that flows non-stop into the numerous fountains dotted around the town is to all intents and purpose the same water that is bottled by the bottling plant located just outside the town that is then sold on to various supermarket chains throughout the region and beyond. The former is freely available to take without limit but you, frankly, don’t find the good citizens of the town frenetically rushing to the nearest fountain to fill up every available container they can lay their hands on.  There is simply no need to.  They know the water is always going to be available for them to take whenever they need to.  Curiously (under the circumstances) the bottled version of the same water is stocked in the local supermarket and, needless to say, comes with a price tag.

The free access to potable spring water that the town’s residents and visitors alike enjoy might well be taken as an exemplar of the principle of distribution in Marx’s higher phase of communism.  The point is that it works.  And there are multiple other examples of the same principle that can be found to work even under capitalism today.  People do adjust their behaviour to fit the material circumstances they find themselves in.

When Marx talked about all the “springs of co-operative wealth” flowing more abundantly in his higher phase of communism this should not be taken to mean that he had in mind some unlimited cornucopia of absolute abundance.  That particular gloss on the term is an idealised abstraction or reflex that springs from the basic precept of bourgeois or mainstream economics – the dogma that human wants are insatiable.  Given the allegedly insatiable nature of such wants abundance is unobtainable – unless you mean this idealised version of “absolute abundance” of literally everything and we all know that that is unobtainable. Therefore, goes the argument, “socialism is impossible”.  Case closed. But is it? “Scarcity” according to this argument is built into the very concept of opportunity costs – namely, to do or to have X we must necessarily forego Y.   But this particular construction of scarcity is a trite truism.  It is what you might call “psychologically empty”.  Nevertheless it allows our budding undergraduate economist in the rarefied world of bourgeois economics to smugly maintain that socialism is a pipe dream since it presupposes that we will be able to do or to have both X and Y in order for socialism to be possible. In short, the disappearance of opportunity costs altogether.   Since this is indeed impossible then so too must socialism be impossible.

But this is not what socialists mean by “scarcity” or “abundance” at all.  The fact that I choose to play tennis in the afternoon does indeed mean I have to forego the opportunity to take a walk in the park at the same time or any other of the countless activities I could be doing. But in what sense, pray, is this going to present a problem?  Am I going spoil my game of tennis by fretting over the opportunity I have thereby foregone to engage in some other activity? Any reasonable person would surely think not.

It is an all too wearily familiar refrain from (some) environmentalists unfamiliar with Marx’s writings that he was sceptical or disbelieving of the notion of ecological limits and was religiously devoted to some promethean goal of unlimited “production for the sake of production”. However, there has been a veritable spate of books and articles published in recent decades that have utterly debunked the idea that Marx was unaware or unconcerned about the destructive impact of capitalist economic activity on environment.  I refer the reader to books such as Howard Parson’s Marx and Engels on Ecology (1977), Paul Burkett’s Marx and Nature: A Red and Green Perspective (2014) and more recently still Kohei Saito’s Karl Marx’s Ecosocialism: Capital, Nature, and the Unfinished Critique of Political Economy (2017).

Engels, Marx’s collaborator, was no less passionately committed to the environmental cause. In his Outlines of a Critique of Political Economy (1843) he observed how the private ownership of the land, the drive for profit and the degradation of nature all hang together. “To make earth an object of huckstering — the earth which is our one and all, the first condition of our existence — was the last step towards making oneself an object of huckstering” 

Forty years later in his The Dialectics of Nature (1883) he penned what is arguably one of the most beautiful and compelling passages of environmental prose one is likely to encounter:

“Let us not, however,  flatter ourselves overmuch on account of our human conquest over nature. For each such conquest takes its revenge on us. Each of them, it is true, has in the first place the consequences on which we counted, but in the second and third places it has quite different, unforeseen effects which only too often cancel out the first. The people who, in Mesopotamia, Greece, Asia Minor, and elsewhere, destroyed the forests to obtain cultivable land, never dreamed that they were laying the basis for the present devastated condition of these countries, by removing along with the forests the collecting centres and reservoirs of moisture. When, on the southern slopes of the mountains, the Italians of the Alps used up the pine forests so carefully cherished on the northern slopes, they had no inkling that by doing so they were … thereby depriving their mountain springs of water for the greater part of the year, with the effect that these would be able to pour still more furious flood torrents on the plains during the rainy seasons. Those who spread the potato in Europe were not aware that they were at the same time spreading the disease of scrofula. Thus at every step we are reminded that we by no means rule over nature like a conqueror over a foreign people, like someone standing outside nature — but that we, with flesh, blood, and brain, belong to nature, and exist in its midst, and that all our mastery of it consists in the fact that we have the advantage over all other beings of being able to know and correctly apply its laws.”

But did not the Communist Manifesto argue for the need “to increase the total productive forces as rapidly as possible” you might ask.

Certainly it did. But in no way can this be construed as a rallying cry for unlimited production for the sake of production and consumption for the sake of consumption.  In fact, that claim makes no sense at all.  The whole point of the exercise was to raise the productive potential of society to the point at which the reasonable needs of the population can be adequately met, at which point the competitive pressure on our natural resource arising out of material scarcity can then begin to ease off. The notion of “limit” is implicit in the very logic of the argument itself. Arguing for the need to increase production up to a certain point cannot be squared with the idea of unlimited production or production for the sake of production.

Unless we can increase production up to that point where our basic needs can be adequately met it is inevitable that, in the words of The German Ideology, all “the old crap must revive”. A truly ecological socialist society has also to be a post scarcity society.

As stated, in Marx’s time the prospect of a post scarcity was not on the cards. This perhaps helps to account for some of the more questionable ideas he put forward – like his labour certificate scheme — which socialists today are under no obligation to go along with.  Nevertheless, he and Engels were sensitive to ongoing developments in their time and not dogmatically attached to what they had previously written. Thus, in the 1872 Preface to Communist Manifesto we find them saying:

The practical application of the principles will depend, as the Manifesto itself states, everywhere and at all times, on the historical conditions for the time being existing, and, for that reason, no special stress is laid on the revolutionary measures proposed at the end of Section II. That passage would, in many respects, be very differently worded today. In view of the gigantic strides of Modern Industry since 1848, and of the accompanying improved and extended organization of the working class, in view of the practical experience gained, first in the February Revolution, and then, still more, in the Paris Commune, where the proletariat for the first time held political power for two whole months, this programme has in some details been antiquated

The mention here of the “gigantic strides of Modern Industry since 1848” is a reference to the growing productive potential of modern industry to supply the population with their means of subsistence.  Socialists today would argue that this productive potential to create a post scarcity society has been around for at least a century.  Consequently, there is no need to defer socialism on the grounds that that productive forces need to be “further developed” as Marx and Engels had argued in their time.

Even in their time they were able to detect the growing contradiction between what society was able to produce and what it profitably allows to be produced.  Even as early as 1848 they noted in their Manifesto that in the guise of economic crises “there breaks out an epidemic that in all earlier epochs, would have seemed an absurdity – the epidemic of overproduction”. Increasingly, the problem that capitalism has to contend with is its ability to produce too much, not too little, by its own yardstick of what is “too much”.  An oversupply of commodities in relation to what the market demands causes prices to fall and along with that, profits.  Some may dismiss the concept of a contradiction as metaphysical mumbo jumbo but for the workers laid off when it is no longer profitable to employ them in the face of glutted markets, that contradiction is all too tangible.

Since Marx the contradiction between what society actually produces and its potential to adequately meet human needs has, if anything grown exponentially.  In fact, the existence of such things as empty homes alongside homeless people or the destruction of food to boost prices in the face of starvation is only one small aspect of the sheer waste of capitalism.  More significant still is the fact that the bulk of economic activity carried on in capitalism today has nothing to do with meeting human need at all.  It has simply to do with meeting the systemic needs of capitalism itself and with enabling this system to tick over.

The entire financial sector is one among many examples of capitalism’s steadily growing, and already enormous, “structural waste” which diverts vast quantities of materials and labour into activities that are completely irrelevant and useless from the standpoint of meeting human needs.  Yet you will never grasp the full extent of this waste unless you view it through the prism of a perspective informed by Marx’s notion of full communism – a society in which individuals produce directly to satisfy their human needs rather than for sale on the market.

The ecological implications of this argument are absolutely huge yet Pena seems to have not the slightest inkling of any of this.  He does not understand that simply by virtue of fundamentally changing the mode of production to a fully socialist or communist one (in the Marxian sense) and thereby eliminating the enormous structural waste of capitalism we can, in one stroke, significantly increase the output of socially useful wealth and, at the same time, significantly reduce the pressure we currently exert on the environment.  We can produce more with much less by diverting all those massive quantities of material and human resources that we currently waste on socially useless production into socially useful production.

However, it is not just a question of supply.  Scarcity – or abundance – is a function of both supply and demand. I am reminded of Marshall Sahlin’s seminal work Stone Age Economics: the original Affluent Society (1972) in which he talked of there being two possible routes to affluence:

“Wants may be “easily satisfied” either by producing much or desiring little. The familiar conception, the Galbraithean way, makes assumptions peculiarly appropriate to market economies: that man’s wants are great, not to say infinite, whereas his means are limited, although improvable: thus, the gap between means and ends can be narrowed by industrial productivity, at least to the point that “urgent goods” become plentiful. But there is also a Zen road to affluence, departing from premises somewhat different from our own: that human material wants are finite and few, and technical means unchanging but on the whole adequate. Adopting the Zen strategy, a people can enjoy an unparalleled material plenty-with a low standard of living.”

Marxian socialism represents a kind of dialectical fusion or interplay of both these approaches to achieving affluence.  Marx’s humanism is predicated on the belief that we are fundamentally social animals at heart and that we are capable of recognising our basic interdependence as individuals and act upon this in ways that encourage responsibility to each other and towards our natural environment upon which we all depend. Our attitude towards nature is conditioned by our attitude towards each other.  As C S Lewis once said: “What we call Man’s power over Nature turns out to be a power exercised by some men over other men with Nature as its instrument”.  The Abolition of Man, 1843.)

The kind of society we live in today, however, makes it difficult for such an outlook to take hold and gain a footing.  When a multi-billion dollar global advertising industry relentlessly eggs us on to buy yet more stuff and insidiously drip feeds into us a sense of personal inadequacy that can only be assuaged through that curious ritual that goes by the name of retail therapy, we know we are in the presence of powerful forces bent on shaping and moulding our view of the world to fit its own particular agenda — the maximisation of profit.

Such is the expansionist dynamic built into a system of market competition.   Capitalism is a zero sum game in which one business enterprise must seek to capture a larger slice of the market at the expense of another or go under. This is the material basis of “productionism” — production for the sake of production — in a profit driven economy in which the overriding imperative is to accumulate more and more capital out of profit in order to stay ahead of the competition.  Its natural corollary is “consumption for the sake of consumption”.

Consumerism, as this is called, is inextricably intertwined with the very existence of capitalism, with the very existence of production for sale on the market.  Individual business desperately seek to increase what they can sell on the market even if the contradictory nature of capitalism is such that in their individual effort to produce and sell more they collectively bring about a state of affairs in which the markets for what they blindly produce become glutted. Production for the market, as we have seen, nurtures individualist values just as it undermines collectivist values.  But if we put ourselves at the centre of the universe and have little or no regard for the wellbeing of others what is there to restrain us from seeking to accumulate without limit and in the process inflict damage on the environment?

In the acquisitive society that is market capitalism the status of an individual, the esteem in which she is held, tends to boil to her wealth and her conspicuous consumption of such wealth.  No amount of moralising against the “consumerism” of the average citizen is going to prove effective when we live in a world in which a tiny handful of multi-billionaires — the very exemplars of “capitalist success” which we are urged to look up to and strive to become — own more wealth than half this world’s population combined, this grotesque inequality being the very product of market capitalism itself.

In stark contrast, Marx’s vision of a socialist society renders such a notion of “status” completely meaningless simply by virtue of the fact that each and every individual has free access to those goods and services she requires.  Actually, the only way in which you can earn the respect and esteem of your fellows in such a society would be through what you contribute to it, not what you take out of it.

Marxian socialism recommends itself as the most appropriate and most direct route to a truly ecological society.

Abridged and adapted from here

https://dissidentvoice.org/2020/10/the-marxian-theory-of-value-a-response-to-david-pena-part-three/