Value Stuff (to Jim Miller)

John R. Ernst ernst at
Mon Oct 30 22:03:21 MST 1995


Well, you've moved me from someone who thinks
LTV is religion to one who bickers with folk like
Keen.   I suppose this is progress.

My most recent challenge to Keen is a presentation of the
LTV that allows inclusion of the FRP.  Frankly, I do not
think the LTV makes any sense at all unless it includes
the FRP and a theory of crisis.   It is not and cannot
compete with any general equilbrium analysis on the
basis of mathematical beauty, elegance, etc.  But then
again as my old friend Vivian Walsh noted -- this type
of economics has nothing to do with reality.  Vivian was

When we do battle with folk like Keen who know the
traps one can fall into with the LTV, we have to not
only  avoid the traps but also present a version of the
LTV that makes sense and, again, allows us to develop
the FRP and crisis theory.  That's what I attempt to do
in my latest post.  This is hardly bickering.  My next
move in our discussion will be to force him to use his
concept of value to describe the same system I do.
(Don't tell him this.)

At the same time, let us note his contribution to our
knowledge.  Namely, he took to a passage in the
GRUNDRISSE in which Marx descibes mechanization in
a way which both his opponents and the majority of his
defenders would claim is not in Marx.  That is, Marx, by
way of example, notes that the capital inputs increase more
slowly than outputs.  Sweezy, Dobb, Steedman, Schefold, etc.
all claim that Marx holds the opposite view.  We've simply
got to  work this into the LTV.  The last model I tossed Steve's
way does this.  Bickering?  I do not think so.

Let's also note that this pattern of accumulation should be
less foreign to those of the post-Keynesian bent like Steve,
then it is the vast majority of Marxists.  Perhaps Marx had
it right when he noted that he was not a Marxist.

I am not one who jumps on the first point that one uses against
the LTV, nor am I one who relies on my 21 year old reading of
CAPITAL.  Most who follow either path have given up on both
the FRP and crisis theory.  I am one who thinks Marx
had it right and it's up to us to complete the work. In the
process, we may have to praise Keen (he is not Steedman),
but we will bury him. (Famous last words)

Yours in orthodoxy,


John R. Ernst

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