REBLOGGED: Notes on the Fragment on Machines

Fragments — فتات

The “Fragment on Machines” is the best known (and perhaps least understood) portion of Marx’s tremendous collection of notes known as the Grundrisse. It has been subjected to study by seemingly every Marxist or pseudo-Marxist theorist since the 1970s, from the pioneers of the wertkritik school to Paul Mason. While the entire passage is worth reading, the most consequential portion of the “Fragment” is its sixth paragraph, which I will include here in its entirety:

The exchange of living labour for objectified labour – i.e. the positing of social labour in the form of the contradiction of capital and wage labour – is the ultimate development of the value-relation and of production resting on value. Its presupposition is – and remains – the mass of direct labour time, the quantity of labour employed, as the determinant factor in the production of wealth. But to the degree that large industry…

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Can we afford to work less than we do now?

Not surprising, one of the most persuasive arguments against abolishing wage labor is that it leads to poverty for the workers. As the comment below from a writer on Reddit states, loss of a job can have a profoundly negative impact on an individual’s financial situation:

If this is anti-work, then how do you get by?

I’m out of a job myself (not by choice), but I still need to make money because I need to make bill payments. My parents have been helping me, but I don’t want to be a burden on them. … I just want to know how y’all get by without work to have money for wants and needs.”

Continue reading “Can we afford to work less than we do now?”

Twenty-third note on Moseley’s “Money and Totality”

Next year will be the anniversary of a rather earth-shattering event. May 29, 2019 will be 100th anniversary of the famed first confirmation of Einstein’s Theory of Relativity.

One of the key tenets of Einstein’s theory is that space-time can be distorted by the motion and mass of objects moving through it. The light from one distant object would appear to bend as it passed near the body of another sufficiently large body on its way to still a third body.

One scientist came up with a way to test this outlandish idea: the effect, although small, might still be measurable not near any body we might encounter on Earth, but on the largest body in our Solar system: the Sun: during an eclipse, and given the right conditions, we might be able to measure the slight change in position of a distant object beyond our solar system consistent with the prediction of Einstein’s theory.

This photograph from the May 29, 1919 total solar eclipse shows one of the stars used to confirm Albert Einstein’s general theory of relativity. The red dot shows where the star would have been without the sun’s interference.
Credit: Royal Observatory, Greenwich

On May 29, 1919, this measurement was successfully accomplished, changing the natural sciences forever. Our conception of the universe was no longer that of a flat, static, unchanging space-time. Within a few decades of this confirmation of Einsteins new theory, the now expanding universe was populated by all sorts of strange new theoretical objects, including black hole singularities where the known laws of the physical universe — including Einstein’s — may no longer hold.


Now, you may ask, what does any of this have to do with Moseley’s book, “Money and Totality”?

Good question.

Einstein’s theory of relativity was the answer to contradictory observations of natural phenomenon for which existing theory could not account. To explain these contradictory observations, Einstein was forced to re-conceptualize space-time itself. This new space-time was no longer flat and unvarying. Gravity, rather than affecting the trajectory of objects, described the shape of the space-time through which objects moved.

Similarly, Marx’s labor theory of value was the answer to persistent contradictions that arise in labor theory of value once prices have to account for the division of socially necessary labor time into the wages of the working class and the profits of capital. Bizarrely, it appears capitalistically produced commodities do not have prices that express their labor values. They have prices of production that no longer directly express the socially necessary labor time required to produce them.

According to Marx’s solution, once the value of labor power was converted into wages, the prices of commodities were converted into capitalistic prices of production, i.e., into the costs of the constant capital and variable capital plus an average rate of profit. The average rate of profit was calculated on the basis of the total social capital and apportioned among individual capitalists as if they were shareholders in a single capitalist firm according to the relative share of their stake.

Contrary to our expectation, division of the social product of the exploitation of the working class takes place not according the relative mass of surplus value squeezed out of the individual work forces of each capital, but by the relative share of capital controlled by each capital in the process of accumulation generally. The manner in which the average rate of profit forms means that even in the case of capitals that employ no labor power and thus create no surplus value they will realize the average rate of profit based on their total mass of employed capital.

Thus, although, ultimately, labor is the only source of profit in the mode of production, empirically it appears each capitalist firm can create its own profit by progressively shedding the costs of wage labor.

This then sets the stage for the self-negation of the capitalist mode of production.

IAN WRIGHT: The solution to Marx’s transformation problem: my article in the Cambridge Journal of Economics

REBLOG: Ian Wright offers his very interesting solution to the transformation problem


I’m happy to say that my article on Marx’s transformation problem has now been published in the Cambridge Journal of Economics. After a little negotiation with Oxford University Press, I am able to link to a free version of the article from my website. Here it is.

Marx’s transformation problem and Pasinetti’s vertically integrated subsystems

This article is quite theoretical, and I’ve mentioned it previously Here, I want to be a little more blunt, in order to simplify the main message.

First, a frequent claim, both on the right and left of the political spectrum, is that the classical labour theory of value, and especially Marx’s version, is provably false, in virtue of a transformation problem. My paper unequivocally demonstrates the opposite: I prove that equilibrium prices, even in a capitalist economy with positive profits, represent the labour time actually supplied by workers. So the central claim and intent…

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The tragedy of Postone

“You know, my analogy is if you want to understand the significance of  great work of art, you don’t necessarily interview the artist.”

One of the great tragedies of Moishe Postone was that he was never able to extend his profound grasp of Marx’s thinking to the problem of strategy in the 21st century before his death. In this video he explains the likely reason for his failing at about the 31 minute mark while commenting on Marx.

Marxists aren’t the only dumb-ass mother-fuckers with doctorates…

Preferring to focus on unworkable, half-baked solutions like “an economy-wide cap-and-trade program, plus a suite of complementary policies to boost energy efficiency and the use of renewable energy in key economic sectors” that will never be supported by Washington nor win even a modicum of political support among ordinary citizens, the Union of Concerned Scientists has completely neglected the idea, originally proposed by Keynes in 1930, that by 2030 society could produce everything it needs with little more than a 15 hours work week.

Such a reduction of working hours would easily achieve UCS’s stated goal of reducing the threat of climate change — AND FIX MASSIVE SOCIAL INEQUALITY AND POVERTY.  But that would be too easy for these addled brainiacs because it doesn’t involve math, I guess.

The executive summary of the silly UCS proposal can be read here.

Twenty-second note on Moseley’s “Money and Totality”

We have seen that with the transformation of the value of labor power into wages, the conversion of the values of commodities into their prices also undergoes a conversion.

If before the price of an individual commodity was the direct expression of the individual socially necessary labor time required for its production, this is no longer true. While the sum of prices still equal the sum of labor values, the price of any individual commodity no longer equals its individual value. Rather, the price of the individual commodity equal its price of production, i.e., the value of the constant capital and the value of the labor power consumed in its production plus an average rate of profit.

This average rate of profit is calculated against the total capital of society and divided among capitals as their share of the total loot.

The capitalist mode of production establishes a new form of sociality that directly conflicts with the sociality of exchange relations found in simple commodity production. In this form of capitalistic sociality, the act of production is mediated as a totality. The labor power consumed in the production of commodities is mediated as a single homogenous labor power. The product of this labor power, the surplus value produced by it, is treated as a single product to be divided up among the various shareholders of the total capital in proportion to their share in it.

This new sociality of capitalistic production works to the direct advantage of those owners of capital who most aggressively replace the employment of living labor in production with machines. It concentrates and centralizes capital in their hands.

This, Marx argues, has real implications for the employment of wage labor, which Moseley and his various Marxist colleagues completely neglect in their discussion of the transformation problem:

“And whilst centralisation thus intensifies and accelerates the effects of accumulation, it simultaneously extends and speeds those revolutions in the technical composition of capital which raise its constant portion at the expense of its variable portion, thus diminishing the relative demand for labour.

The masses of capital fused together overnight by centralisation reproduce and multiply as the others do, only more rapidly, thereby becoming new and powerful levers in social accumulation. Therefore, when we speak of the progress of social accumulation we tacitly include — today — the effects of centralisation.

The additional capitals formed in the normal course of accumulation (see Chapter XXIV, Section 1) serve particularly as vehicles for the exploitation of new inventions and discoveries, and industrial improvements in general. But in time the old capital also reaches the moment of renewal from top to toe, when it sheds its skin and is reborn like the others in a perfected technical form, in which a smaller quantity of labour will suffice to set in motion a larger quantity of machinery and raw materials. The absolute reduction in the demand for labour which necessarily follows from this is obviously so much the greater the higher the degree in which the capitals undergoing this process of renewal are already massed together by virtue of the centralisation movement.

On the one hand, therefore, the additional capital formed in the course of accumulation attracts fewer and fewer labourers in proportion to its magnitude. On the other hand, the old capital periodically reproduced with change of composition, repels more and more of the labourers formerly employed by it.” (Marx, Capital, V1, ch.25)

Twenty-first note on Moseley’s “Money and Totality”

We have seen in the previous note that Capital “A”, employed 30 hours of labor power in its production of widgets and created 30 hours of surplus value, while capital “C” employed no labor power in its production and produced no surplus value.

Despite this fact, the commodities sold by capital “C” realize a price in the market for its commodities above their value, while the widgets sold by capital “A” realize a price below their value.

The commodities sold by capitals “A”and “B” are thus sold not at their respective values, but at their prices of production. The commodities sold by capital “C” are sold at their value, but only because the organic composition of capital are the average for the three.

As noted by Moseley in a footnote on page 39, Bohm-Bawerk, who, apparently could read as well as (or perhaps better than) any Marxist, saw this bizarre result and remarked on it:

“Böhm-Bawerk 1949 criticised Marx for assuming that prices are equal to values (in Volumes I and II) and that prices are equal to prices of production (in Volume III), which he said is contradictory: prices cannot both equal values and not equal values. But Böhm-Bawerk did not understand Marx’s logical method of the two levels of abstraction – the total economy and individual industries. In Marx’s theory, total price = total value, but individual prices = prices of production. There is no contradiction with Marx’s logical structure of the two levels of abstraction.”

In this footnote, three issues are being conflated:

  • Is there a contradiction in the formation of capitalist prices of production?
  • Is Marx talking only about the total economy?
  • Is there a contradiction in Marx’s logical method?

Let’s take the second issue first, because it is easiest to to dismiss: as Thomas Lord notes in an earlier comment, Marx is not simply talking about the ‘total economy’ — whatever that means. The same principles Marx describes should generally hold as true between departments of a single capital, an industry, a region, a national economy or the world market as a whole. To be clear, there is no reason to assume this relationship holds for, say, a national economy or a certain industry, but not for a regional bloc, (like the EU), or the world market. Lenin’s superprofits can as easily be explained by Marx’s transformation of values into prices of production as by Lenin’s imperialist division of the world market.

So, is there a contradiction between the values of commodities and the formation of their capitalist prices of production or are we just seeing Marx’s labor theory of value going badly off the rails?

In first place, we know Marx was not the first theorist to encounter this conundrum. Ricardo and Smith ran into it as well. This would suggest that either labor theory suffers an intractable flaw that cannot be expunged, or that it is accurately revealing a more fundamental — and, for our purposes, more significant — flaw in the mode of production itself.

What flaw could this be?

While it generally holds true that the sum of prices equals the sum of values and the sum profits equals the sum of surplus value, this relation is no longer true in the case of any actual commodity.

Of course, under simple commodity production this is already true to some extent. Fluctuations in the market prices of commodities owing to supply and demand and other influences mean that only over the long-run will these prices reflect the value of the commodity on average. But under the capitalist mode of commodity production, the prices of commodities no longer equal their values even in the long-run. Individual prices and individual values have become permanently detached.

At the individual level, the relationship between labor values and prices have already begun to disintegrate.