"new solution"

Fred B. Moseley fmoseley at mhc.mtholyoke.edu
Tue Nov 1 10:57:15 MST 1994

I agree with Hans Ehrbar on many things, including unproductive labor
and the rate of profit, about which I appreciate his recent post on my
debate with Cullenberg and Laibman.  However, one important disagreement
is over the "new solution" to the transformation problem.  Actually, I
think the "new solution" is a step in the right direction - away from
the neo-Ricardian interpretation of Marx's theory in terms of linear
production theory - but it does not go far enough.  It rightly assumes
that VARIABLE capital is taken as given in money terms.  However, it
also assumes that CONSTANT capital is not taken as given in money terms,
but is instead derived from given technical conditions of production, as in
the neo-Ricardian interpretation.

Therefore, there is a methodological inconsistency in the "new solution"
interpretation.  Since both constant capital and variable capital are
component parts of the general concept of capital, these two components
should be treated in parallel, consistent fashion.  Either they should
both be taken as given, as I argue they are in Marx's theory, or they
should be derived from given physical quantities, as in the neo-
Ricardian interpretation.  Those who accept the "new solution" should
provide an explanation for their different treatments of constant
capital and variable capital.

My argument that both constant capital and variable capital are taken
as given in money terms is based on:  (1) Marx's general formula for
capital, M - C - M', which is the general analytical framework for
Marx's theory and which begins with a given sum of money, M; (2) the
logical relation between Parts 1, 2 and 3 of Volume 1 of Capital,
according to which the development of the concepts of money and capital
in Parts 1 and 2 provide the logical presuppositions for the analysis of
surplus-value in Part 3 and beyond; and (3) the numerous passages in
the various drafts of Capital in which Marx states that the quantity of
the initial money-capital is "presupposed" or "postulated" in his theory
of surplus-value.  Those who accept the "new solution" should either
refute these arguments or should show how they are consistent with their

For elaboration of these comments, see my paper "Marx's Logical Method
and the Transformation Problem" in my edited volume Marx's Logic in
Capital (1993, Humanities Press), especially the next-to-last section
on the "new solution".

Fred Moseley


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