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Tag: commodity production

Capital, commodity production and collapse (V): After collapse, what?

Part 5: Is Marxism today out of sync with history?

“Whether you can observe a thing or not depends on the theory which you use. It is the theory which decides what can be observed.” –Albert Einstein

In first place, the failure to recognize production based on exchange value has already collapsed implies Marxists are (or may be) looking for an event to occur in the future that has already happened in the past. In second place, it is effectively the same thing as stating Marx was wrong about the ultimate trajectory of capitalist production. At best, we have to explain why Marx’s predicted breakdown has not happened already; at worst, we might conclude Marx’s theory has been falsified by history.

This problem is further complicated when Marx’s theory is misread to predict something he clearly never predicted, “a collapse of capitalism”. If capitalism did not collapse as Marx said it would — and, obviously, it has not — it must follow his theory has been falsified by history. The problem with this conclusion, of course, is that Marx never actually predicted capitalism would collapse, he predicted production based on exchange value would collapse. In Marx’s theory, the collapse of production based on exchange value might very well lead to the end of capitalism as well, but it could just as easily lead to the state becoming the national capitalist, the direct exploiter of the working class.

If you think Marx predicted the collapse of capitalism, Marx is obviously wrong. This is bad for Marx, but no worse than hundreds of would-be prophets throughout history who have turned out to be wrong, including a considerable population waiting for Jesus to return. But if you think Marx predicted the breakdown of production based on exchange value, as I do, the implications are much worse for the working class today.

If Marx was right, Marxists today are completely out of sync with history.

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Capital, commodity production and collapse (IV): Collapse or Collapsed?

Part 4: Back to the future?

If you ask the typical Marxist to name the most important prediction made by Marx’s labor theory of value, they will likely point to his prediction of a proletarian social revolution. Few, if any, Marxists will argue Marx’s most important prediction was that commodity production would break down, capitalist private property would be expropriated and the bourgeois state would be forced to undertake management of production.

Which is odd, since, in the intervening 160 years, no successful proletarian revolution has occurred, yet we have witnessed the collapse of production based on exchange value, the expropriation of capitalist private property and we have seen the state undertake management of production — a ubiquitous and routine function in all countries today. By the measure of an alleged prediction of a proletarian social revolution, it can be said Marx’s theory, at best, remains unproven. Yet, by the measure of a break down of production based on exchange value, Marx’s theory has been remarkably accurate.

It’s almost as if Marx knew what he was talking about. “Almost”, reply many of our most influential Marxist theorists.

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Capital, commodity production and collapse (III): Collapse of what?

Part 3: Breakdown in Marx’s Theory

So, I have been mulling Marx’s prediction of the ultimate result of capitalist development with increasing confusion — confusion because Marx is extremely precise, yet he never exactly predicts the breakdown or collapse of capitalism itself.

Marx makes three important predictions about capitalism.

First, in the Grundrisse, he predicts,

“As soon as labour in the direct form has ceased to be the great well-spring of wealth, labour time ceases and must cease to be its measure, and hence exchange value [must cease to be the measure] of use value. The surplus labour of the mass has ceased to be the condition for the development of general wealth, just as the non-labour of the few, for the development of the general powers of the human head. With that, production based on exchange value breaks down, and the direct, material production process is stripped of the form of penury and antithesis.”

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Capital, commodity production and collapse (II)

Part Two: The ambiguous case of the Soviet Union

To explain profit, Marx proposed the existence of a new type of commodity peculiar to the capitalist mode of production. This new commodity, labor power, had the characteristics of a typical commodity; it had a value equal to its socially necessary labor time and it had a specific social use value: it could be used as capital to produced surplus value. The specific social use value of this commodity, argued Marx, explained how capital created profit apparently out of nothing.

It also explained how capital violates the premises of commodity exchange generally.

In commodity production, of which capital is a specific historical form, the value of a commodity is equal to the socially necessary labor time required for its production. The time spent on production of the commodity in excess of what is necessary on average for its production creates no value.

To illustrate his point, Marx pointed to the case of a producer who, by lack of skill or laziness, spent more time producing her commodity than the social average. This additional labor time, argued Marx, produced a commodity with no more value than that embodied in a commodity produced by a skillful efficient producer. In the market, each would fetch the same price, with no more paid for the commodities of lazy unskillful producers than for the commodities of efficient ones.

The reproduction of labor power as a commodity, however, operates according to decidedly different laws than those of simple commodities. It is the source of surplus value and the quantity of surplus value created by its productive consumption is directly proportional to its duration. In contrast to ordinary commodities, therefore, the duration of labor expended by labor power in production must always exceed the duration of socially necessary labor time required for the reproduction of the labor power itself.

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Capital, commodity production and collapse (I)

Part One: Capital and commodity production

The anti-communist, Karl Popper has argued a good scientific theory is one that can be falsified by evidence. By this measure Popper claimed Marxism was not scientific.

Another, broader, view of what constitutes a scientifically valid theory is offered in Lee Smolin’s book, The Trouble With Physics, which makes this point about good theory: It brings together things once thought separate and thereby broadens our understanding of the world around us. A good theory, even when it cannot be immediately verified by experiment, revolutionizes our understanding of the world around us:

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Money and socially necessary labor time: A (Pre-)Review of Moseley’s new book

You are not supposed to review a book without having read it. This often poses a problem for me, since I never buy books, but sometime want to say something about them before I can steal them off the internet.

Such is the case with Fred Moseley’s new book, ‘Money and totality’. Fortunately, in the case of Moseley’s new book, there is a paper trail going back at least to the 1990s on which I can draw to raise questions about his argument. These pre-publication texts (here, here, and here, along with a recent review of the book by Michael Roberts, raise enough questions about Moseley’s so-called ‘macromonetary’ approach to capital that allow me the opportunity to outline a number of troubling problems with methods.

I will detail them in the following post. The reader is forewarned, however, that what I say here may have already been addressed by Moseley in the book.

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Why Keynes predicted a 15 hour workweek, but Marx did not

One final question raised by John Milios’ paper on crisis theory remains to be addressed.

I have shown that Keynes’ explanation of the Great Depression was identical to that underlying Marx’s prediction that commodity production would collapse, namely the constant reduction of the socially necessary labor time required for production of commodities.

3026617I have also shown that the Great Depression took the form predicted by Marx: a collapse of production on the basis of exchange value. If, as Marx’s theory asserts, exchange value must take the form of commodity money, we should expect the collapse of production on the basis of exchange value to express itself as a crisis of commodity money. The minutes of the Federal Reserve from the outbreak of the Great Depression does indeed indicate that commodity money stopped circulating in the “economy” after 1929.

Keynes failed prediction

Moreover, Keynes initially argued this crisis made necessary both the reduction of hours of labor as well as existing “social customs and economic practices, affecting the distribution of wealth and of economic rewards and penalties”. In other words, Keynes thought the Great Depression established the immanent economic necessity for an end to a society founded on wage slavery. If the critical question debated by the classical Marxists was whether or not Marx had established the immanent economic necessity for socialism, Keynes appears to suggest he did — although he never mentions Marx in his essay.

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The Value of Labor Theory: Money as a class dictatorship

Continued from here

Labor screen_shot_2014-04-13_at_7.29.21_pmtheorists are so used to expressing their ideas in the form of abstract, scholastic, indecipherable bullshit, they have lost all ability to state in clear language, comprehensible to the working class, the gist of the argument they wish to make.

Take, for instance, this passage from Paulani’s paper:

“the categorical evolution of money results in a need for the expulsion of the materiality of money, that is, its ‘natural’ logical movement leads it to a figure that is no longer connected with a real (produced by labour) commodity.”

What does this gibberish even mean?

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The Value of Labor Theory: Money is a political weapon of one class over another

Continued from here

Here is a fact that is absolutely vital to your material standard of living and that of your children:

Money is political.

atlanticapril2012It is a political weapon employed by one class in society to subjugate the other class and force it to labor ceaselessly.

Yet, today, we have a bunch of useless labor theorists running around who approach money as if it is above classes. There are two classes in society and, therefore, two antagonistic and incompatible expressions of the socially necessary labor time of society. This cannot but give rise to two fundamentally incompatible money forms. The struggle in society over which money form will be established as the universal equivalent cannot be divorced from the struggle over what constitutes the socially necessary labor time of the working class.

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The Value of Labor Theory: Money as an unconscious class war raging in society

Continued from here

One of the difficulties I often encounter when discussing money is that the discussion is so couched in incomprehensible philosophical or scholastic bullshit that the absolutely vital stake ordinary working folks have in the debate never dwars 88 Unifac Financien - Basia Dajnowiczsees the light of day. The question at issue in the debate is not just “What is money?” Rather, the question posed is “What would be the socially necessary labor time of society today if the money we used was a commodity money as Marx argued?”

Labor theorists have a number of very interesting answers to the question, “What is money?” But not a single one of them has ever actually investigated the implications for wage slavery if their pet answer were true. You can look at the writings of people like Moseley, Foley, Nelson, Arthur, Campbell, etc. All have very interesting answers to the question, “Must money be a commodity?” However, one thing you will notice in common in all of these papers is that not one of these useless academics ever manages to explain how their particular answer affects the labor time of the working class.

It is time to put an end to this sort of nonsense: money is class warfare and labor theorists are fighting on the wrong side.

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