The Real Movement

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Tag: quantum theory

Schrödinger’s Capital: FYI, Marx NEVER said labor creates value

NOTE 15: Some labor creates value

So, here is the problem with Heinrich saying we don’t need proof for Marx’s propositions: Not all labor creates a product that contains value.

Think of it this way: According to Arthur, money is simply use value with no labor value whatsoever, just like all other commodities. According to the value-form school, it is the physical material of money that gives all other commodities their value, by serving as the form of value, the value-form, the money-form. Commodities, says Arthur, are the product of concrete useful labor, not abstract labor. It is not until these commodities are exchange for the value-form, that they are reduced to values.

In the value-form argument, commodities do not have a social property of value prior to exchange; they remain simply incommensurable use values — objects that cannot be compared as values, because they are of completely different qualities. Thus, before exchange, we cannot say 10 apples equal one hoe because the usefulness of apples cannot be quantitatively compared to the usefulness of hoes. Somehow, the exchange of the objects for the value-form strips the commodities of their useful qualities and reduce them to abstract labor values. Read the rest of this entry »

Schrödinger’s Capital: Michael Heinrich explains why Marxists don’t have to prove anything

NOTE 14: Proof is for real sciences, not labor theory?

What sort of science is this that Marxists believe in? According to Michael Heinrich:

“Tied up with the question concerning the difference between Marx’s value theory and classical value theory is the question of whether Marx had “proven” the labor theory of value, that is, whether he had established beyond the shadow of a doubt that labor and nothing else underlies the value of a commodity. This question has been frequently discussed in the literature about Marx. But as we’re about to see, Marx was not at all interested in such a “proof [value lies behind prices].”

That statement is from Michael Heinrich’s Introduction to the three volumes of Capital, chapter 3, section 2, and it is just astonishing.

To understand the flaw in Heinrich’s reasoning, remove Marx and insert Einstein: “Einstein was not at all interested in such a proof of the existence of space-time relativity.”

Or, remove Marx and insert Darwin: “Darwin was not at all interested in such a proof of evolution.”

Would physicists or biologists accept this argument from Heinrich? Why would anyone who calls herself a Marxist? We are discussing the whole underlying structure of a modern capitalist economy, but we don’t require proof for that structure? We can just wing it until we get to extremely complex questions like the transformation problem or whether there is a law of the tendency for the rate of profit to fall, where, all of a sudden, proof value is behind prices and profits is demanded?

And Marxists wonder why no one takes them seriously.

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Schrödinger’s Capital: Money, “technological unemployment” and the cold war

NOTE 13: Historical materialism minus the history part

I have been reading, “Marx and Monetary Theory”, by Matthijs Krul. At the outset, Krul makes this statement:

“In the context of the current crisis, with ‘quantitative easing’ to the tune of hundreds of billions of dollars on the one hand and the rush to liquidity that accompanies financial crises on the other, it may be useful to take a look at how Marx’s economic theory relate to issues of money and monetary policy. The aim here is to provide a clear and understandable overview of what Marx’s theory of money was, how it relates to our current-day monetary system internationally, and how this relates to his value analysis generally.”

image-A699_4D98869BAccording to Krul in this 2010 essay, the financial crisis makes it useful to compare Marx’s approach to money (and, by implication, value and exchange value) with bourgeois monetary theory. The problem, however, is that in Marx’s theory money is the expression of the values of commodities. By contrast, bourgeois theory lacks a theory of money and treats money as a mere system for counting up incommensurable use values.

Since the commodities themselves are incommensurable, what else the prices might represent is unclear from Krul’s discussion — he never mentions the word, value, until he discusses Marx. It is possible that bourgeois economics believes money is a system for counting itself. As Arthur puts, money is both the form and measure of value.

In any case, bourgeois theory bounces between two poles: in times of relative calm it adheres more closely to the Austrian theory. During times of crisis, it suddenly declares, in the words of Milton Friedman, “We are all Keynesians now.”

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Schrödinger’s Capital: Is the US dollar world money or the end of money?

It is important to say I want to preserve the science of historical materialism. To be clear, the outcome of this debate has nothing whatsoever to do with the outcome of the class struggle. Despite claims to the contrary by various vanguardist parties, no class in history ever made a revolution based on its theoretically accurate grasp of the society it was seeking to overthrow. The proletariat will not break that pattern. We can thus safely separate the issue of the scientific veracity of historical materialism from the social implications of its conclusions to answer the troubling questions raised by the value-form school argument.

I say this to emphasize I do not think Chris Arthur is “being revisionist” or some such nonsense. Instead, the science itself is being challenged by the appearance of something many people assume labor theory never predicted, a fiat currency filling the role of ‘world money’. Historical materialism has a big problem of explaining whether this fiat ‘world money’ is in fact money, and, if so, how it works.

NOTE 12: The end of exchange value?

According to Marx, a use value has value only if it is the product of human labor. The quantity of value contained in any product of human labor is the duration of socially necessary labor time required to produce the commodity. The value of a commodity is expressed as exchange value in a transaction in which the value of the first commodity is expressed in the use value of the second commodity. According to Marx the value of a commodity can only be expressed in the use value of another commodity also having value. The commodity socially recognized as playing the role of money is simply the one whose use value serves to express the values of all other commodities in the community.

This definition of money is commonly recognized by almost all Marxists. But if Marx is correct about this, the dollar, a valueless state issued inconvertible fiat paper currency, cannot be world money. The problem with the dollar serving in the role is that, as bitcoin shows, it can be produced with no expenditure of human labor whatsoever. And, it can be produced in whatever quantity is required almost instantaneously. This means the dollar is not a product of human labor and thus contains no value at all.

Which bring Marxists face to face with a paradox: If the dollar is world money, Marx must be wrong by his own definition. If Marxists recognize dollars as world money, they are — by the same definition — no longer Marxists.

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Schrödinger’s Capital: How Marxists missed the biggest story of the last 45 years

NOTE 11: What the fuck happened to wages?

This is what US price inflation looks like from 1913 to 2012 according to Bureau of Labor Statistics (BLS).

Consumer Price Index 1913-2012 (BLS Series Id: CUUR0000SA0)

Consumer Price Index 1913-2012 (BLS Series Id: CUUR0000SA0)


This is what the change in the standard of prices (gold) look like over the same period:

Gold price standard - 1913-2012 (

Gold price standard – 1913-2012 (

I would like to you to see what happens when I set these two measures of depreciating dollar purchasing power side-by-side

CPI versus Gold measure of dollar purchasing power depreciation - 1913-2012

CPI versus Gold measure of dollar purchasing power depreciation – 1913-2012

One of these measures of dollar purchasing power depreciation is lying. Can you guess which one it is?

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Schrödinger’s Capital: Why the value-form school never publishes supporting empirical data on money

NOTE 10: What is the value of empirical evidence?

According to Arthur (2003):

“The primary function of gold money is to ‘posit the presupposition’ that commodities count as values.   This it does in virtue of the price-form, not because as a material body it has any such magical powers.   So a substitute material may be found in paper, if this is granted forced circulation by the State,   and hence acquires the key determination of immediate exchangeability.”

Money, according to Arthur, plays a purely symbolic role in that it introduces the assumption use values in a commodity producing   community are values. The use values become values because they are exchanged for the value-form, money, not because they contain any intrinsic value. What the prices (exchange values) of commodities tell us is that the object has been exchanged for a money, nothing more.

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“Schrödinger’s Capital”: The neoclassical core of the value-form argument

NOTE 9: Value equals price?

Marx makes a pretty simple argument in Capital: In any exchange, the only property a commodity has in common with any other commodity is that it is a product of labor. The values of the commodities consists of an expenditure of homogenous human labor power.

Later (in chapter six), Marx defines labor power this way:

“By labour-power or capacity for labour is to be understood the aggregate of those mental and physical capabilities existing in a human being, which he exercises whenever he produces a use-value of any description.”

For some odd reason, Marx only actually says what he means by the term, human labor power, in chapter six. But, okay. What he means by the term “labor power” is the “capacity for labor”. And this must be emphasized: labor power, or labor capacity is not actual labor, which latter is always concrete. So far as I can tell, human beings do not labor in the abstract any more than any other animal.

The total capacity for labor of a commodity producing community, or its total labor power, however, is the aggregate mental and physical capabilities they possess.

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Schrödinger’s Capital: Chris Arthur explains why inconvertible fiat is as ‘good as gold’

NOTE 7: Why the value-form school carefully avoids empirical proof of its claims

In his 2003 paper, Money as Measure of Value, Arthur seems to recognize the obvious fact that, taken in isolation, commodities do not possess a value property in the same way they possess physical properties like weight, mass, chemical composition and spatial dimensions.

schroedingers_catOf course, this was the whole point of the first few paragraphs of chapter 1 of Capital. There, Marx argues, try as we might, no amount of physical decomposition of a use value will find even an atom of value. The value of commodities is not a property they individually possess, as they might possess weight, mass, chemical properties or spatial dimensions; rather, the property of value arises solely from the social context within which the use value is produced.

Thus, the reason why we can’t see the values of commodities is because these values are the manifestation of social relations of production, not a physical property of the objects. In this sense, Arthur’s argument is a welcome advance over the vulgar reading of Marx where it is sometimes assumed each commodity actually contains a substance called value. Again, following Marx, Arthur explains that money is the only adequate form of exchange value: it is the only way the value (i.e., social properties) of commodities can appear to us.

And then, inexplicably, Arthur goes weird on us.

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Schrödinger’s Capital: Is Marxism now a variant of anarcho-capitalism?

NOTE 6: Why did the gold standard collapse?

In 2003, Chris Arthur wrote a paper which if valid has staggering implications for labor theory. The topic of the paper was one question facing labor theorists: Was Marx correct to insist money had to be a commodity?

The implication of the question is staggering, because, since 1971, the international currency system is not tied to any commodity. The system is a collection of valueless currencies not backed by any commodity that float against each other. All Marxists agree Marx himself held that in the final analysis money had to be a commodity. If this is true, something with huge implications for labor theory of value occurred in 1971 — something so huge no labor theorist can ignore it.

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“Schrödinger’s Capital”: How Marxist academics use ‘Dialectical’ to turn bullshit into a theory

NOTE 5: The paradox of the value-form

What do you do when you can’t explain how concrete labor is reduced to abstract labor?


You just do what Chris Arthur did in 2012: deny that labor is the source of value.

Chris Arthur realized the argument of the value-form school was falling apart on a critical question. The value-form school could not explain the process by which concrete labor was ‘reduced’ to abstract homogenous labor. Certainly, the value-form school argued, value required the value-form, i.e., money, but how exactly could you explain where money comes from without assuming the prior existence of value and exchange value?

According to Marx’s labor theory, money began as a simple commodity long before it emerged as the money commodity. But even as money the commodity serving as money is a simple use value having no unique value characteristics. Value, on the other hand, is complete abstraction from the useful qualities of the commodity.

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