Trump has declared war on the Federal Reserve…

Taken from CNBC:

The knives are out. Trump will campaign against the Democrats by using the Fed as a foil. Just to be clear, the Fed is a proxy for Wall Street. When the Democrats rush to its defense, they will destroy their own credibility.

MELTing the concept of socially necessary labor time

Not Sally

I have been reading a series of essays by the Australian economist Peter Cooper on the alleged compatibility between Marx’s labor theory of value and modern monetary theory, which he has given the title, Marx and MMT. In particular I have been studying this particular essay, Part 1: Three Kinds of Macro Variables, which purports to show consistencies between Marx’s approach and modern money theory.

Needless to say, I am not impressed.

Peter borrows heavily from the TSSI school, who employ the so-called MELT approach to money as a substitute for Marx’s own theory of money. Here is the problem with the so-called monetary expression of labor time employed by the TSSI school as a substitute for Marx’s theory of money:

In the United States, according to the Bureau of Labor Statistics, during the month of May, 2019, approximately 162.6 million workers were employed. The BLS also estimates that, on average, these employed workers worked about 34.4 hours each week. This amounts to a total of 5.6 billion hours of labor time per week.

Does this mean that the value produced by these workers amounts to the equivalent of 5.6 billion hours of labor?

Perhaps, but how would we know?

Bernie Sanders’ horrifying vision of “democratic socialism” | FULL VIDEO

For the convenience of my readers, the full, uncut disaster that is the Sanders’s campaign in its full horrifying scope.

 

Marx, TSSI and Modern Money

The Daddy-State economy in modern money theory according to MMT theorist Billy Mitchell

Here is an interesting post: Marx, Fiat Money and a Simple Business Card Economy, from the blog, Magpie’s Asymmetric Warfare. The motto of the blog is appropriate: “Maybe the world is going to hell. But I’m not going down in silence.”

The post is actually from February 2016. As things so often happen, it is only now coming to my attention. I came across this piece from the internet the way I come across most things I come across on the internet when it popped up on my blog as a link.

I usually ignore these referrals, but this one contained three words I cannot resist: Marx, Fiat and Money. So I went to investigate. The post began with a quote from one of my old posts and it seems the writer thinks my take on fiat money is wrong. My error appears to have something to do with my misunderstanding of modern monetary theory.

At the top of the page there is a category titled, “Marx + MMT“. Although I think MMT is a crock, I was intrigued by what possible connection this group thought existed between Marx and the modern money school. So I decided to check it out.

Pro-Tip: To Fight Austerity the Radical Left Must Embrace Austerity

I have already said that if you want to make sense of the European elections, don’t look at the results in the UK.

Okay, the statement was a little bit cryptic and could even be said to be reductionist. So, let me expand on this argument briefly. Instead of trying to make sense of the European Parliament results, look instead at Fiat Chrysler. That’s right, Fiat Chrysler, not the Brexit Party, Labour Party or even the UK European elections results generally.

From SYRIZA to Brexit

Don’t make the mistake of trying to make sense of the EU parliament election results. Remember, in Britain a party that didn’t exist a month ago managed to come from nowhere and capture the plurality. You can’t make sense of the complete collapse of the nation-state, because the nation-state was how you made sense of everything up until this point.

But there is a pattern if you are cunning enough to catch it. We have been here before. In 2015, SYRIZA, just three years old, swept aside the major parties in Greece and became the ruling party. It had all the appearance of a party in power. The reality turned out to be otherwise, of course. What SYRIZA actually had was the opportunity to bury the state — an opportunity it squandered foolishly in a vain attempt to hang on to state power.

I said at the time that SYRIZA’s failure would be to the benefit of the fascists and let me just emphasize that I was absolutely correct. The radical Left refuses to admit its mistakes, refuses to correct its errors. It paves a path for its political enemies. Even now radicals want us to believe that the results of the European election have no domestic political consequences, that business as usual, in the most literal sense of a continuation of wage slavery, can continue unhindered.

Suit yourselves, the nation-state is dead; stick a fork in it … and the radical Left.

Farewell to the Labour Party … and the European Union

A party that didn’t exist a month ago, now leads in Britain and will determine the UK’s relations with the European Union.

Wage Labor and Inflation I

This post is based on a discussion I had on Reddit, r/antiwork. It is a work in progress.

I posted this item to Reddit and was not surprised by the reaction. In fact, I expected it:

If the minimum wage kept pace with depreciation of the dollar it would be $45 an hour today

In 1970, the minimum wage was about $1.25. Today it is about $7.25. If some on the Left had their way, the minimum wage would be $15.

To see how low the Left sets it sights, we need only realize that in 1970 an ounce of gold went for $35. Today that same ounce of gold fetches $1,250. Over the intervening 50 years gold hasn’t become more valuable, the dollar’s purchasing power has declined.

This means your real wage has collapsed without you even realizing. In truth, to have the same standard of living your parents had working a minimum wage job in 1970, you would have to be earning $45 an hour today.

You’re not even close. Wage slavery doesn’t work for wage slaves. That’s why they call it slavery.

The post garnered several negative comments, that took exception to my approach, which uses gold price as the metric for inflation. Most people preferred the Bureau of Labor Statistics Consumer Price Index (CPI) instead:

Marx, Breakdown and the renegade Kautsky

I have come across a very interesting paper by Terrence McDonough and Robert Drago with the absurdly long title, “Crises of Capitalism and the First Crisis of Marxism: A Theoretical Note on the Bernstein-Kautsky Debate“. The paper tries to get a handle on the link between the capitalist recovery from the first “Great Depression” (what some today call “The Long Depression“) at the end of the 19th century and the first crisis among the Marxist leaders of the Second International.

According to McDonough and Drago, Marxists at the turn of the 20th century were not prepared for the recovery that welcomed the dawning of the 20th century. This unexpected recovery of capitalism, the authors argue, triggered the crisis sometimes referred to as the rise of Bernstein revisionism:

“The Marxists of the Second International had no concepts with which to handle the Phoenix-flight of capitalism that they were experiencing. The Second International had developed a somewhat mechanical view of Marxism and the world. All phenomena were seen as an expression of certain laws inherent in the nature of matter. This notion was transferred to the analysis of the capitalist economy. Marx’s tendencies became laws analagous to the laws of physics. This included Marx’s observations about capitalism’s tendency toward crisis (Colletti 1972). Such a view was unable to explain capitalist recovery from long-term crisis. The crisis of Marxism was, in the last analysis, a product of the recovery from the Great Depression.”

Whether this explanation make sense is of no concern to me. I am not in the habit of trying to trace purely contingent political events back to their economic causes. Mostly it is a fool’s errand in my opinion.

Society chose Barbarism and it has its own peculiar political economy

Adam thinks the society I am describing no longer resembles the capitalist mode of production as described by Marx in Capital. He wonders why changes in the monetary system would have such far-reaching changes in how the mode of production operates. And he questions the validity of my reading of Marx’s labor theory:

The implication, Jehu, of what you say is that since April 5, 1933, capitalism has been replaced by a different system of society, an implication which no doubt you accept and which is the basis of your whole approach. But I don’t think it holds water. Society today is still based on the ownership and control of productive resources by rich individuals, corporations and states; production is still carried for sale on a market with a view to making a monetary profit, and is performed by people hired to do the work for a monetary payment. The change in the currency that took place in the USA in 1933 hasn’t altered this basic social fact. And, as a purely monetary change, there is no reason why it should have done. That workers should be paid in tokens for money rather than money itself is not a significant change. Nor was 1933 the first time it had happened.

Has capitalism been replaced by a different system?