[Marxism] "Sales"?

Leonardo Kosloff holmoff10 at hotmail.com
Mon Jul 4 22:50:38 MDT 2011

Tom Cod wrote:

“So, I mean, isn't a sale needed to realize that

surplus value. A sophomoric young high priest on a marxist

scoffed in my face when I asserted there is
"overwhelming evidence"

that supply and demand and subjective factors in the minds
of buyers

affect prices and market behavior. leaving aside Marketing
101, why

is that wrong?”

Haha, indeed, that was me: greetings comrade Cod. Well,
firstly, let me say that my pontification had no ill-intention, more of a writing
in the rush problem, in a language not my own. Anyway, I appreciate you bring
it up again, I was planning to write something about this but work is holding
me down as usual, so my response will have to be brief, but I’ll provide some
helpful links below.

As for supply and demand, Marx was clear about this in Capital,
it explains nothing 

“Classical Political Economy borrowed from every-day life
the category “price of labour” without further criticism, and then simply asked
the question, how is this price determined? It soon recognized that the change
in the relations of demand and supply explained in regard to the price of
labour, as of all other commodities, nothing except its changes i.e., the
oscillations of the market-price above or below a certain mean. If demand and
supply balance, the oscillation of prices ceases, all other conditions
remaining the same. But then demand and supply also cease to explain anything.
The price of labour, at the moment when demand and supply are in equilibrium,
is its natural price, determined independently of the relation of demand and
supply. And how this price is determined is just the question. Or a larger
period of oscillations in the market-price is taken, e.g., a year, and they are
found to cancel one the other, leaving a mean average quantity, a relatively
constant magnitude. This had naturally to be determined otherwise than by its
own compensating variations. This price which always finally predominates over
the accidental market-prices of labour and regulates them, this “necessary
price” (Physiocrats) or “natural price” of labour (Adam Smith) can, as with all
other commodities, be nothing else than its value expressed in money. In this
way Political Economy expected to penetrate athwart the accidental prices of labour,
to the value of labour. As with other commodities, this value was determined by
the cost of production. But what is the cost of production-of the labourer,
i.e., the cost of producing or reproducing the labourer himself? This question
unconsciously substituted itself in Political Economy for the original one; for
the search after the cost of production of labour as such turned in a circle
and never left the spot. What economists therefore call value of labour, is in
fact the value of labour-power, as it exists in the personality of the
labourer, which is as different from its function, labour, as a machine is from
the work it performs. Occupied with the difference between the market-price of
labour and its so-called value, with the relation of this value to the rate of
profit, and to the values of the commodities produced by means of labour,
&c., they never discovered that the course of the analysis had led not only
from the market-prices of labour to its presumed value, but had led to the
resolution of this value of labour itself into the value of labour-power.
Classical economy never arrived at a consciousness of the results of its own
analysis; it accepted uncritically the categories “value of labour,” “natural
price of labour,” &c.,. as final and as adequate expressions for the
value-relation under consideration, and was thus led, as will be seen later,
into inextricable confusion and contradiction, while it offered to the vulgar
economists a secure basis of operations for their shallowness, which on principle
worships appearances only.” http://www.marxists.org/archive/marx/works/1867-c1/ch19.htm

This, like I said that last time (if I remember correctly)
does not negate the problem of realization of surplus value by any means,
against what you had said and seem to be implying now, viz. Marx was oblivious
to it. See the Grundrisse for example, though I know it’s something of a Talmudic
crime to cite this work around here. 

Same thing goes for the staunch Leninists who dismiss Marx
because he assumed competitive capitalism. It is plain clear that Marx was more
than aware of the form the market takes with monopolies, in his critique of Proudhon,
in volume 1 of capital, not to mention his analysis of ground rent, theories of
surplus value, etc.. The point is: Marx was no political economist building
models of capitalism; ergo, he assumed nothing, other than the real determinations
presented to him. Contrary to the theoreticians who start from concepts,
interlace them, and call it “rigorous science” when they can throw a couple of
equations at it, including *many* in the Marxist political economy academic
establishment, Marx was crucially aware of the inversions this leads too.

The issue is that, precisely, by starting from concepts,
definitions and assumptions, the logical representation which then becomes –vulgar-
“science” by appending the label ‘theory’ to it, is confined to proceed by
stopping at the appearances presented to it, emptying them out of their real
determinations, their content, make them fit the with rest of the preconceived
structure at hand, and then throwing a bunch of distorted statistics around it,
call this an empirically supported image of reality. Then science is reduced to
models, that is, interpretation, philosophy in the most backward possible

Such is the case with classical political economy, and the
crudest abstractions of neoclassical theory, with the issue of supply and
demand. What happens is that these theories assume what they have to show, that
is, the form of reproduction and the realization of the unity of social
production and consumption. With neoclassical economics, we have equilibrium,
with Adam Smith the invisible hand, with the Ricardians and its followers -including
its Marxist variants- the labor theory of value which substitutes exchange
value for value, and *assumes* this unity from the start, making it all so
rigorous by putting these inverted abstractions in an input-output matrix. In
fact, in these ways, the realization problems are assumed away at the

This does not imply that Marx left out “Sales”, or that he
circumvented demand, (although, as I see it, Marx had not fully developed his
thinking about this in Value, Price and Profit,) in order to prove what he
already had in mind (like David Harvey so grotesquely puts it in his latest
book ‘A companion to Marx’s Capital’, p.22 onwards; the quote about Wagner fits
him to the letter I would say). Sales, demand, al the forms of the market, must
be explained by showing what the necessity of those forms are, so that when
they do present themselves we do not take them as having an independent
ahistorical existence of their own and from there miss the historical
specificity, and hence transitory character, of the capitalist mode of
production. The question then is, what is the market?, where does price, and
later, money, come from? What is the necessity for the representation of the
materiality of the labor invested in the production of commodities as value? Without
having these questions settled, political action is nothing short of quixotic,
and boy, is the world full of Sanchos these days.

Particularly, what is most crudely abstracted from, is that
in capitalism production doesn’t aim at the production of use values, or more
popularly, stuff, but surplus value, in other words the aim, its aim, is to
produce more of itself.  A use value in
capitalism is but the material bearer of the social relation ruled by capital,
by the form of value. And so the demand and the supply are ruled by this form
of reproduction, people don’t consume things cuz they “choose” to, people
consume in the quantities and modalities ruled by their purchasing power, the
money in their pockets, which certainly does not fall from the sky. Here it is
not a matter of computing at what exact time you ‘choose’ to buy a strawberry
ice cram instead of chicken, because such “subjective” issues are not what is
at stake for the political action which is ruled by a full knowledge of its
determinations, and as a matter of fact, the contradiction between what people
choose to buy, in an accidental fashion let’s say, and the limits of their
action as personifications of labor or capital, is the very point of the
necessity for production to be realized in the market, that is to say, ex-post.
The market exists because labor in capitalism is performed in a private and
independent manner and so insofar as I can rule my own individual private labor
process, it is presupposed that I have no purview over the actions of another
commodity producer, therefore this reciprocal independence in the control of
labor, which takes the form of the most socially interdependent society in
history, must be realized by forbidding the full control over the social
character of labor, which is to say, nobody knows how much to produce for
others. Only when the necessity for the form of this reproduction is
established can we look at what the form in which the unity of social
production and consumption is to take, what Marx calls the law of value.

But even then, what the important question is, for me at
least, is why should we think about these things at all in order to guide our
political action? Well, however many interpretations out there, the one thing
we can say is that the question of political action in capitalism has been
presented to our consciousness, and if we do mean our action to be conscious,
with knowledge of its cause as Engels would say, then we must search for what
its historical necessity is. In other words, I, contrary to Milton Friedman,
did not “choose” to be a socialist, or to read Marx, or to be political, that
is part of my determinations as a human in this society, and so, not to sound
Wittgensteinian, if the question has been presented then there is the potential
for me to come up with an answer which will resolve it on my own. Abstracting
from such historical necessity, like economic theory, I would venture say in
all its forms, does, cuts such resolution from the root at the very beginning,
indeed it serves to reproduce the opposite but equally necessary purpose, as
long as capital rules over the conscious determinations of commodity producers,
of reproducing the alienation of consciousness by imagining itself as
abstractly free.

So, there’s the question, wherefore (sorry, been watching
some Shakespeare plays done by the BBC, they’re incredibly good) such

To answer this question, I can, most certainly, use Marx’s
own answer to the question as a guide, but I have to look at my determinations
on my own, otherwise Marx is a prophet, I’m just a religious follower, and the
historical necessity is thrown out the window.

So…some useful links,

First, some shameless self promotion, a translation I’m
doing for my friend Juan Iñigo Carrera where he develops his own approach to
the necessity of these questions, as well as a straightforward but very clear
unfolding of the ways in which political economy and modern economics, of
necessity, throw all the real determinations at stake out the window to
construct their inverted ahistorical models.


Also, this article by Guido Starosta touches on some of the
questions about the law of value 


Second, I’ve been reading some good things by Simon
Clarke who has a lot of his work freely accessible here http://www.warwick.ac.uk/~syrbe/Publications.html. 
Particularly, his Marx’s
Theory of Crisis, and the one on Keynesianism, I think is useful regarding the
history and problems of sales, realization, underconsumptionism, etc. But there’s
also some other really good stuff about the changes in the ex-Soviet economy
and China, focused on the conditions of workers, I haven’t gone through it very
much though, but I bet there’s some other very good stuff there as well.



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