Why Marxist academics are charlatans — all of them, without exception

by Jehu

The argument that needs to be explored is that between 1867 and 1971 an essential category of Marx’s Capital disappeared. In 1867 money was a commodity with value, transactions involving money were exchanges of value, exchanges of socially necessary labor times; by 1971 this was no longer true. Its disappearance was predicted by Marx’s labor theory of value, but has not been recognized by the Marxist school of political economy.

The Marxist school have refused to recognize this change, its cause and its implications. For the life of me, I cannot understand why they are so stubborn on this. Even if you don’t agree with my view on this, it is a testable counterfactual: the dollar in 1867 was pegged to gold, today it is not. Both gold and the dollar continue to exist today. We know gold is money. And we know why it is money. The question is whether currency is money apart from its relation to gold.

To test the counterfactual that currency in circulation today is not money, all you have to do is compare dollar prices since 1867 to gold prices since 1867. If the relation between the two is unchanged since 1867, my counterfactual argument is falsified. Not a single Marxist who has challenged Marx’s theory of money has ever provided any empirical proof for their claim. They will provide charts and graphs to prove any assertion except the one that says fiat currency behaves like gold.

Mind you the implications of debased fiat currency are staggering: if my counterfactual is falsified, Capital Volume 1 can be thrown in the trash. There is no more Marx’s labor theory of value. And no need to ever speak of it again. All it takes to completely discredit Marx is a single empirical demonstration that fiat prices and gold prices behave the same way.


Why might the gold/fiat counterfactual be important apart from me wanting to expose Marxists for being pitiful charlatans? In Marx’s theory, gold is the universally recognized embodiment of exchange value. In this function gold (commodity money generally) expresses the socially necessary labor time required for production of commodities. Fiat is not money precisely because it cannot express the socially necessary labor time required for the production of commodities. If fiat cannot express the socially necessary labor time required for production of commodities, it would be nice to know what it does express, right?

If fiat can’t express the values of commodities, what function is it fulfilling when it serves as means of exchange? We know it is not a measure of the values of commodities according to Marx. This means wages paid in this fiat currency are not a measure of the value of labor power. Groceries paid in fiat are not the measure of the values of the groceries. And, if they are being paid in valueless counterfeit, they are using valueless counterfeit to purchase groceries. Which means, as things now stand, neither labor power nor any other commodity have exchange value.

Essentially, paying for commodities in fiat currency is the same as handing them out for free!

Do you think the working class might just want to know their wages don’t express the value of their labor power? Do you think the working class might want to know they being paid in valueless counterfeit? Do you think they might want to know that paying for necessities with fiat is the same thing as handing them out for free?


What evidence do I have for the proposition that paying for commodities with fiat is the same getting them for free? Simple, when the fascist state paid for its new aircraft carrier, the Gerald R Ford, it simply “printed” the currency up and paid for it. Another example: When the financial system began to collapse, Bernanke simply “printed” currency up and bought outstanding toxic assets. In both case, the fascists raised no taxes and had to borrow no capital for these items, they simply printed up what they needed. The fascist state could do this because it is the sovereign issuer of the currency.

This is just not limited to aircraft carriers and toxic assets; the fascists can purchase anything, from labor power to corn. And they do this without paying anything for the commodities.

This should immediately raise a question: if the fascists can print up money and bail out banks why can’t they print up money and hand out UBI? Why can’t they print up money and hand out free healthcare or free college education? Why can they print up money and pay off the student debt of millennials? Do you think there are millions of folks out there who might want to know the answers to these questions? Just maybe?

But we can’t get to why the state buys toxic assets but won’t buy up student debt because we have a bunch of fucking Marxist academics who insist fiat is fucking money!

You can’t print money, you have to dig it out of the ground; which means, you can’t hand out UBI, free healthcare, free education or pay off student loans with money. But you can do all of this and more if you can just print up as much valueless currency as it takes. Bernie Sanders and a host of reform-minded fascists propose programs like this and Marxist academics have nothing to say about it because they base their own arguments on obsolete assumptions. Bernie Sanders comes off looking like the radical and Marxists come off looking stupid.


And here is the kicker: if you can just print up currency and pay for any commodity, you can just as easily abolish prices outright. Which is to say, if you print up currency to pay for healthcare, you really don’t need to pay for healthcare at all; if you can print up currency and pay for labor power, groceries, healthcare and education, all these things could be provided free. There is no reason for wages and thus no reason for any other commodity purchased by wages to have a price.

Now, I don’t know what that sounds like to you, but to me that sounds like full communism.

The same argument that argues the counterfactual — namely, that fiat is not money — also implies a fully developed communist society is possible right now. We could possibly have a society based on the old communist ideal of “from each according to ability, to each according to need”. Thus, by falsifying my counterfactual argument, it is possible not only to refute Marx, and discredit Capital, but also to show why a fully development communist society is not possible now.

To put this another way: our ability to determine how close we may be to fully communistic society hinges on the capacity of fiat to accurately tell us how much of the social labor day at present is socially necessary. The communization theory argument that it is possible to move directly from capitalism to a fully communistic society largely depends on evidence for a very large mass of unnecessary labor time that can be converted directly into free time for all members of society. Only a money commodity can tell us how much of the present working day is unnecessary, because only a money commodity can express the socially necessary labor time required for production of commodities.

Fiat currency can serve as means of exchange, but it cannot tell us the values of the commodities for which it is exchanged. It is possible, therefore, for fiat prices to conceal a rather large amount of socially unnecessary labor time within the social labor day and none of us would be the wiser.

Potentially, fiat prices could even conceal unnecessary labor that, on the surface, appears to be socially necessary like, for example, the steel used to build an aircraft carrier. Few Marxists would argue that aircraft carrier production is necessary labor, but how many realize that the steel that goes into the production of the aircraft carrier is also unnecessary precisely because it ends up in production of the aircraft carrier? All of the labor expended on all of the commodities going into the production of the aircraft carrier and all of the new labor expended directly on it’s production is unnecessary because the final product, the aircraft carrier, is unnecessary to material production.

Despite this, however, the production of aircraft carriers can be extremely profitable for capital; more profitable in fact than any other production because none of the outlay of capital for its production can possibly add to the subsistence of the workers, nor does it reenter the circulation of capital as new additional capital.

But let’s not get ahead of ourselves counting our communist chickens before the capitalist eggs have even been laid.


Given the huge stakes here, I can’t understand why none of these fiat loving Marxists don’t just go ahead and falsify my counterfactual argument. All you academics who think Marx was wrong about money, here is your chance to make a name for yourself by proving him wrong. Take the gold and dollar prices of 100 commodities since 1867 — iron, cotton, labor power, shoes, etc — and show that the prices of these commodities denominated in gold and dollars track one another within the limits of accurate measurement.

  • There goes your next book, Andrew Kliman.
  • There goes your next book, Michael Heinrich.
  • There goes your next book, David Harvey.
  • There goes your next book, Michael Roberts.
  • There goes your next book, Gerard Dumenil.
  • There goes your next book, Chris Arthur.
  • There goes your next book, Anwar Shaikh.
  • There goes your next book, Fred Moseley

Make a real name for yourselves by showing conclusively, based on real empirical data, that Marx was wrong about money.