John R. Ernst
ernst at pipeline.com
Tue Oct 17 01:24:33 MDT 1995
Let me see if I can deal with some of the concerns,
questions, and criticisms you have raised in your
last two posts. (one responding to me, the other
to Andrew Kliman).
I'm not sure whether what you wrote conveys what you meant
at the end of your post:
|Thus, it would seem that for Marx to it right we
|1. Assume that the use-value of labor-power, labor,
| is transferred to the output like that of a
|2. That the wearing out of the instruments of
| production and the role that that process plays
| in the analysis is tantamount to ignoring
| the role of use-value.
|3. That the comparison Marx makes between the
| increase in productivity and the increases in
| devaluation or depreciation as capital grows
| somehow shows that machines create value.
but if it did, that is close to what I am arguing.
You are right. The sentence that introduces the
3 points should have read:
Thus, it would seem that for Marx to BE right we
Enough of corrections, now let's see where I think
we have some agreement.
That the comparison Marx makes between the
increase in productivity and the increases in
devaluation or depreciation as capital grows
somehow shows that machines create value.
1. For now I'll say that I do, of course,
disagree with the notion that machines create
value. Indeed, there is more to the
passage in the GRUNDRISSE that you cited
than I thought. The comparison that Marx makes
between with two processes does, by example,
contradict much of modern Marxist thought. Note
that one machine has twice the value of the other
The workers, using the more valued machine,
produce three times as much output. Generally,
this is not the picture painted of Marx's notion
of accumulation. That is, Marx is
generally seen as holding fast to the
notion that the growth in machinery outstrips the
growth in output. This allows for a falling rate
of profit under the condition that
output price = input price
or what I call simultaneous valuation. That you see
this as machines creating value seems secondary
to me if we are in agreement that the Marxian
framework allows for the growth of outputs to be
greater than that of inputs. I assume you have no
problem with this since such a model would, indeed,
give rise to problems of effective demand. With
historic valuation, however, credence
to Marx's falling rate of profit even in the case where
the growth of inputs is less than that of outputs.
This, in turn, allows me to see what I regard as
a further elaboration of the contradiction between
use value and exchange value. That is, as we observe
a falling rate of profit using historic valuation,
we see the possibility of a rising rate of profit
using constant prices. The trick or, I should say,
the problem is to describe how this contradiction is
resolved. It may well be that a great deal of
significance needs to be assigned to the role of
effective demand in solving the problem. Who knows?
No one has done it as the significance of historic
valuation has been noted relatively recently.
Now on to other matters.
2. I agree with you that the use value of labor-power
is labor. Labor is an activity. For Marx, that
means value creation and not as you say the TRANSFER
of value. At first, our disagreement on this
point may, to others, seem merely a matter of words.
But you and I know that your next step is to equate
the next step you want to make. Since Marx says
the value of machinery is transferred in the
production process, machines like labor CREATE
3. It would be all to easy to dismiss your notion
that machines, like labor, create value. Or, if
want, we could say that both machines and labor
transfer value to the output. Obviously, one could
simply turn to Marx and think you are quite mistaken.
A battle of quotes would go on and, as you put it,
we, at best, would agree to disagree. But I think
there is more to it than that. However, I do think
that your position is not foreign to Marx. That is,
viewed from the capitalist perspective there is no
difference between the value creating power of labor
power and the value creating power of a machine. To
the capitalist, it makes no difference. Why
then do we would-be followers of Marx react all too
often with such sound and fury as you attribute
the power of value creation to machinery?
Here, three different reasons come to mind.
a. Religious belief. The notion that labor creates
value has not taken Marxists far in any analysis
of capitalism. Indeed, with simultaneous valuation,
it has taken us nowhere as my old friend in Boston,
Ira Gerstein, can attest. We are confronted with
an Okishio theorem which presents itself as a brick
wall when we speak of a falling rate of profit. The
most popular way around that involves blaming the
working class itself for crisis. Yet, often not knowing
the pitfalls, we cling to the notion that labor and
only labor creates value. At this level, it seems to
me that the notion that labor is the sole creator of
value is more than a little like a religious belief.
b. The Trinity Formula. If we grant Marx the assumption
that labor is the creator of value, then those
who come forth and see value creating powers in things
seem like strange beings from another planet. Why make
the assumption? Given that labor does have a social
aspect and can be aggregated, then the by seeing price
as an expression of value, one can begin to see the
manner in which social labor is distributed. But the
distribution per se, while interesting, is not the
point in Marx's work.
c. That Economic Law of Motion. Here I repeat a bit
of what was said above. By using the notions
individual value and social value as we find them in
CAPITAL, we can try to express what Marx called
"the economic law of motion of modern society."
That is, as the individual value becomes the social
value or the social the individual, we see the
possibility of the resolving the contradiction
between use value and exchange value. Again, as
I stated above, the idea that capital inputs grow
faster than outputs when measured one way and, the
contrary when measured another is a notion that begs
for further analysis. This type of growth is possible
and often present in my own work, Freeman's, and
Kliman's when we drop the assumption of simultaneous
valuation. We, of course, have a problem or two to
solve as we attempt to develop the contradiction
and show its resolution. My own hypothesis is that
Marx's clue about relating turnover time to the
periodicity of crisis may play no small role in this
effort. At any rate, we'll see.
By attributing value creating properties to things, it
seems to me that you remain within the realm of statics.
That is, I'm not sure how you capture the movement from
one period of production to the next. (Here my own
ignorance of your work may play no small role.) How does
revaluation take place as techniques change? What is the
role of "moral depreciation"?
Clearly, we should not resolve our differences simply
citing Marx. Rather I would suggest that correct
path is the one that can best be logically developed to
express that ever elusive law of motion.
John R. Ernst
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