Tue Aug 16 16:16:51 MDT 1994

Chris Bailey has recently provided further evidence against Steve
Keen's idea that the use-value/exchange-value dialectic and
Marx's version of the labor theory of value are incompatible --
notably that Marx used specific Hegelian terms (Substance and
Magnitude) to *reinforce* his conviction that the use-value and
the exchange-value of labor-capacity are incommensurable.

In reply, Keen "simply disagree[s]" -- but he also "def[ies]
[Chris] to find any other reading of the paragraph... where Marx
first reveals the source of surplus than that use-value is
quantitative."  But such a reading is *unavoidable*, according to
the critical-dialectical version of the LTV which is Marx's,
summarized below (from an earlier post to Keen himself):

Marx uses the LTV to explain surplus-value, which arises not from
the production process alone (i.e. as a matter of "production-
inputs and -outputs"), but only from the "complete" (yet ever-
ongoing) cycle of production -> consumption -> production.
 Take as a point of departure the capitalist's purchase of labor-
capacity as a commodity: he parts with its exchange-value (pays a
wage), in order to use its use-value in production.  This use-
value in production *exceeds* the exchange-value paid for it, the
latter being (like that of all commodities) determined by its
cost of production.  This may sound as if use-value and exchange-
value are suddenly comparable  -- but no (as you rightly insist,
they are not): only exchange-values are quantifiable and
comparable; to say that labor's use-value exceeds its exchange-
value is short-hand for saying that the exchange-value
*eventually* realized, through the capitalist's sale of the goods
produced, on the labor-capacity used in producing those goods
exceeds the exchange-value *initially* expended on that labor-

On this view, use-value isn't compared directly to exchange-
value; labor-capacity use-value gets "quantified" only through
the realization of exchange-value on the goods produced by it.

Keen's response is to claim that this presentation of the
critical-dialectical LTV demotes use-value to "secondary status":

>If you treat use-value as a shorthand for the comparison of two
>magnitudes of exchange-value, you drop use-value back to the
>status of a secondary concept...

and goes on to make a good point about how important the concept of
use-value is for understanding problems of "realizing" surplus.

But recognizing use-value's imbrication *in a system* (capitalism)
does not mean demoting it to secondary status (except to the extent
that the system itself does).  There is no doubt that both terms of
the the uv/ev dialectic are crucial: but under capitalism,
"exchange-value is the predominant aspect" -- as Marx puts it in
the Grundrisse footnote Keen quotes.  Moreover, the critical-
dialectical LTV does not make the concept of use-value *itself*
short-hand for anything: it is the idea that "labor-capacity's use-
value in production *exceeds* the exchange-value paid for it"
(original emphasis) that is "short-hand" (as I put it) for a
comparison between use-value (Substance) and exchange-value
(Magnitude) that requires taking the entire cycle of production-
consumption-production into account.  In fact, this *entire cycle*
is what the uv/ev dialectic *itself* entails, when it is understood
that "this content [use-value] as such develop[s] into a [whole]
system of needs and production" -- to quote again from the
Grundrisse footnote Keen considers so important (and here again I
don't disagree: indeed, it is mainly in the context of the entire
cycle that the interesting problems of "realization" he refers to
become significant.)

So what I have been calling the "dialectical" nature of Marx's LTV
includes *both* the uv/ev analysis of the commodity labor-capacity
*and* the complete production -> consumption/reproduction ->
production cycle -- i.e. it involves not just the familiar
interaction of opposites, but also the movement of conflicting
forces within the system over time.  This, I would say (if I had
to), is what "dialectical" means in reference to Marx's critique of
political economy -- and it is this, BTW, that usually escapes
analytic Marxists like Cohen.  (Though I'm not placing Keen in that
category, it seems to have escaped him, too).

I agree with Chris that one dispute centers on whether Marx
considered labor-capacity's use-value to be strictly qualitative;
and I agree with Chris that Marx did so consider it.  The other
disagreement I have with Keen's dismissal of the LTV centers on
whether it was the production of value or of goods that
interested Marx; I asserted the former.  Keen replied "Of course
the production of goods was an interest of Marx's!  Were it
possible for you to go back in time and repeat that assertion to
[Marx] himself, I doubt that you'd survive his reply!"  And yet
in the very quotation from Marx with which Keen opens his post,
Marx had to *remind himself* that use-value (which produces
goods) remains important, so focused was he usually on the
predominance of exchange-value under capitalism.  I can explain:

The reason Marx was so interested in the production of *value*
under capitalism is that while the production and unequal
appropriation of *goods* is characteristic of *all* class
societies, the distinguishing feature of *bourgeois* class-
appropriation is that it takes the form of *value*, i.e. that it
entails exploitation (rather than direct or immediately
"political" modes of appropriation).  (Marx indeed defines
productive labor under capitalism as labor that produces surplus-
value.)  That is the sense in which Marx is interested in the
production of value and specifically of *surplus-value* in his
analysis of capitalism, rather than the production of goods per

So Keen's claim that adherents of the LTV have to "wriggle...
hard... to maintain the LTV in the face of technically competent
criticism," it seems to me, exposes his investment in
"rationalizing" (providing a rational "technical" account of) the
capitalist economic system, rather than providing a *critique* of
it on the basis of its exploitation of labor in the production of
surplus-value.  I'm clear on where Marx's interest lies.

Far from being "simple-minded" (to quote Keen's slur), Marx's
insistence that labor-capacity's use-value is qualitative
constitutes an integral part of the analysis that gives his
critique its vast power.  Keen's misreadings would only hobble

Gene Holland


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