[Marxism] on economics & Michael Roberts

Shalva Eliava shalva.eliava at outlook.com
Sun Oct 4 16:35:00 MDT 2015

"Marx's entire life's work is premised on the fact that workers have the
capacity to organise to replace capitalism. Given that reality, that
some Marxists feel the need to claim that the LTRPF 'leaves little to no
room for the political' is slightly odd."

Well it is odd, but it's the basis of fundamentalists' analysis. Here is
Sherman writing in Foundations of Radical Political Economy (1987):

There seem to be in Marx two different views of values and prices that
surface at different points in his work. On the one hand, Marx takes for
granted the labor theory of value, which he took - and developed - from
Ricardo. In this view, Marx sees certain inexorable laws of capitalism
deriving from the labor theory of value. The notion of such inexorable
laws derives partly from the classical economists and partly from Marx’s
Hegelian tradition. The other view in Marx, which conforms more to the
genius of his own historical approach, visualizes prices and wages as
the result of human relationships and class conflict.

Marx’s first view, the labor theory of value as the foundation for a set
of inexorable laws, is followed by a group often labeled as
fundamentalist, since they agree that the fundamentals of political
economy are all presented by Marx. Three leading members of this group
are Anwar Sheikh, Willi Semmler, and John Weeks, all of whom consider
themselves to be “orthodox” Marxists - though they differ among
themselves on some more minor points. Thus, John Weeks argues that
Marx’s work is characterized by the “central role of the law of value
and its most important manifestation, the tendency of the rate of profit
to fall. This interpretation of Marx’s work...can be called…’orthodox’

The emphasis of Weeks (and Shaikh and Semmler) is on the acceptance and
elaboration of the labor theory of value as found in their
interpretation of Marx. It is an economic determinist view in that
prices, profits, and wages are determined by impersonal economic forces
and not primarily by class conflicts. The theory is stated in terms of
the technology of commodity production rather than human relations: the
value of any commodity is the inherent amount of socially necessary
labor embodied in the commodity. Thus, Weeks even claims that Frederick
Engels “completely misconstrued Marx’s value theory” because Engels
emphasized that class conflicts determine profit and wage levels and,
therefore, income distribution, whereas Weeks believes that Marx argued
only in terms of the inherent value of any commodity, including labor.
In Weeks’ view, class conflict cannot change what the theory of value
has ordained.

The fundamentalists then argue, as Weeks stressed in the quote, that the
labor theory of value inexorably leads to a tendency of the rate of
profit to fall. This is seen as Marx’s central contribution, and the
sole cause of economic crises. In understanding
capitalism...fundamentalists downplay any views based on class
relations, lack of demand by exploited workers, or extensive monopoly.
In this view of economics as a set of impersonal laws of value, coupled
with their tendency to downplay messy phenomena like insufficient demand
or monopoly power in setting prices, they are remarkably like the
neoclassical economists [S.E.: indeed, latter day fundamentalist Andrew
Kliman regularly cites the work of right-wing economists to argue
against claims by other leftists that the worker’s share has declining;
c.f. http://bit.ly/1Z1anSN and http://bit.ly/1FxJI8u and
http://pages.citebite.com/v4j6x6x7j0qsh ]. When asked about the price of
a ton of steel, both fundamentalists and neoclassicals will discuss the
inherent value of the commodities (including labor) that went into it.
Both treat labor as being like any other commodity, and neither
discusses the human relationships involved.

Bowles and Gintis argue that Marx himself, because of his classical and
Hegelian background, sometimes remained in the fundamentalist commodity
mode of thought (though he was its strongest critic at other times).
Thus, Marx argued for socially necessary labortime as the value of any
commodity on the following reasoning: First, Marx argues that every
market exchange (under pure and perfect competition) must be the
exchange of two equal values. Second, he contends that the value must be
given by something contained in each commodity. Marx goes on to argue
that, if two things are being exchanged there must exist in equal
quantities something common to both. The two things must therefore be
equal to a third, which is itself neither the one or the other. What is
this mysterious something giving value to all commodities? Marx claims:
“This common ‘something’ cannot be either a geometrical, a chemical, or
any other natural property of commodities...If then we leave out of
consideration the use-value of commodities, they have only one common
property left, that of being products of labor.” The abstract and
ahistorical approach of this argument (contrary to Marx’s usual
historical and class approach) has led many radicals (or independent
Marxists) to reject this argument - and has led some to reject the whole
labor theory of value as wrong or irrelevant to current conflicts.

Moreover, Marx does not really prove that no other quality is common to
all commodities, because he starts with the classical view and does not
think it necessary to argue it. Bowles and Gintis contend that Marx here
was affected by the same belief in the inherent value of commodities
that he so often attacked (and called “commodity fetishism”). “His
treatment of the phenomenon of equal exchange may be considered Marx’s
own flirtation with ‘commodity fetishism’”. Marx had still not liberated
himself completely from the old view of value; he did not follow his own
approach of political economy as science of human, class relations. This
commodity approach left Marx open to many neoclassical criticisms, all
of which fail if we view the labor theory of value as a class and
relational theory of capitalist institutions.

The Fundamentalist Interpretation of Marx on Exploitation

The fundamentalist or orthodox argument is this:

1. Human labor-power (the capacity to work) is a commodity under
capitalism, sold in the market. It is bought and sold like all other
commodities at its long-run value, which is the amount of labor-time
necessary to produce the worker.

2. The use (or use-value) extracted by the capitalists from this
commodity, labor-power, is the expenditure of labor for a given number
of hours. Those hours may be - and are under capitalism - far more than
the hours required to produce the value of the worker (that is, wages).
So the difference between the value of the worker (wages) and the value
of the product (price) is the surplus value (or profit) going to the

This argument is very formal - it is not firmly rooted in institutional
and human relations - and has several flaws:

Labor power may be called a commodity if one wishes (that is a semantic
or definitional question). But whatever it is called, Bowles and Gintis
are correct that labor power is very different from the usual capitalist
commodity in some very important respects relevant to this argument.
Labor power is similar to the usual capitalist commodity in that is is
bought and sold in the market. This fact often means degradation and
alienation of workers and opens the door to unemployment, but is
nevertheless a fact.
Yet labor power differs from most things called commodities in several
ways. First, in a pure capitalist system, all other commodities are
produced by capitalists. Workers are not produced by a capitalist
assembly line. Workers do consume some other commodities, but most of
the labor going into the production of a worker is the unpaid love and
care of a family.

Second, all other commodities are sold by capitalists in market
exchanges, governed by impersonal supply and demand. Not only is
workers’ capacity to work (or labor power) not produced by capitalists,
it is not sold by capitalists. The workers’ power to labor is sold by
millions of workers - though capitalists, once they have bought labor
power, may sell services. So the supply conditions of labor power are
totally different than those of all other commodities bought by capitalists.

For all commodities, Marx makes the argument that capitalist profit
cannot be made by cheating. If a capitalist sells a machine to another
capitalist above its long-run value measured in labor hours, then one
capitalist makes an extra profit, but the other makes a loss. Therefore,
in the aggregate, if one capitalist cheats another, no profit is made by
the capitalist class. Yet a capitalist could make a profit by cheating a
worker in some sense, so the process of exploitation vesus simple
cheating must be further clarified. (pp. 99-103)

"If it were an inflexible "technologically determinant view of capitalism", it would have either been objectively disproved"

In my mind it's been disproved theoretically (e.g. Harvey's comments in
Limits to Capital pp. 176-189 and Michael Heinrich's two articles in
Monthly Review [http://bit.ly/1VzbhBn]), although it's pointless trying
to argue against all the empirical "proofs" that proponents of "the
tendency" endlessly produce, since they all calculate the rate of profit
differently (as Michael Roberts notes in his The Great Recession [p.
308]: "Kliman reckons it is foolish to try and develop ‘a Marxist rate
of profit’ because there is no one agreed way of doing so.  So he uses
different measures for the rate of profit according to different
purposes.") and vary amongst themselves in terms of the "correct" units
of time for measuring the fall. Certainly there have been plenty of
countervailing proofs showing no long-run rate of profit ( Joseph
Gillman's The Falling Rate of Profit from 1957 and Sherman's The
Business Cycle, in particular Chapter 12).    

The adherents of "the tendency" spend almost all of their time either on
exposition of Marx's work and or on  attacking anyone who would stray
from the "fundamentals" of Marx (as they see them) and seeking to
excommunicate from the church of marxism anyone who tries to analyze the
dynamics of capitalism and its crises outside the phenomenon of the
"rising organic composition" and the "tendency for the rate of profit to
fall".  Needless to say, Monthly Review is their favorite punching bag
in this regard. But at least Monthly Review and other non-dogmatists
like David Harvey spend some time investigating issues. If you take
Marx's observation of capitalist dynamics in the 19th century as
canonical without any possibility of adding to or amending those
observations based on the present state of affairs, then I do not think
there's much point to engaging in a discussion over this... 

On 9/30/2015 11:18 PM, John Edmundson via Marxism wrote:
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> Shalva wrote:
> "I can't say that I've read much of Michael Roberts' non-blog work (or that
> of the other new prophets of "the tendency" like Carchedi and Kliman), but
> I have to agree with the old RPE critique (explicated best in Howard
> Sherman's work) of their intellectual forefathers that "the tendency" is a
> technologically determinant view of capitalism that leaves little to no
> room for the political."
>  If it were an inflexible "technologically
> determinant view of capitalism", it would have either been objectively
> disproved or we would be on an inexorable and rapid path toward the
> overthrow of capitalism and the establishment of communism. Instead, the
> 'LTRPF' is quite clearly described as just that, a *tendency*, and subject
> to many countervailing forces, which makes for a fluid and unpredictable
> world. It is precisely within that fluidity and unpredictability that the "room
> for the political" exists.
> Certainly there have been Marxists in the past, and I am sure there are
> some today, who see these things in mechanistic and inevitable, rather than
> dynamic and dialectical ways. That such people and views exist does not
> disprove the LTRPF.
> Cheers,
> John
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