An Attempt at Self-Criticism

Returning to my old Leftist Arc to Justify my Break Toward Capitalism

Back in 2019 and early 2020, I was a Marxist which I still am not scared of admitting. Out of all things, Marxian class theory was what I believed in most. That the bourgeois class had anything but my interests in view was something I was sure of. The main Marxist whose footsteps I followed in was Mas’Ud Zavarzadeh. He was probably the first critical theorist I ever read. I remember his words, “The goal of bourgeois economics is to conceal this part of the working day.” “This part” specifically being that part of the working day wherein surplus value is extracted from the worker. For Zavarzadeh, surplus labor was undifferentiable from objectivity in that it is its very conversion into surplus value that the capitalist system is predicated on. As he says, “‘Surplus labor’ is the OBJECTIVE FACT of capitalist relations of production: without ‘surplus labor’ there will be no profit, and without profit there will be no accumulation of capital, and without accumulation of capital there will be no capitalism.” Furthermore, he says, “‘surplus labor is that objective, unsurpassable ‘outside.’” For this Marxist orthodoxy, Zavarzadeh’s main argument that “Revolutionary critique is grounded in this truth — objectivity — since all social institutions and practices of capitalism are founded upon the objectivity of surplus labor” is certainly a convincing one. We should certainly follow Bohm-Bawerk from Capital and Interest when he says, “The socialist are able critics, but exceedingly weak theorists. The world would have long ago have come to this conclusion if the opposite party had chanced to have had in its service a pen as keen and cutting as that of Lassalle and as slashing as that of Marx” (390).

What even triggered this thought was a comment from an anti-fascist socialist. They said, “Cyrpto[-currency] should be outlawed. Aside from the environmental effects[.] It is a tool of oppression of the poor [proletariat].”

What causes me hesitation is the idealism that the market will just work itself out. While I certainly believe that increasingly has more and more historical precedent. I do also believe that some of my old arguments need to be sorted out.

While during 2018 I was radically capitalist and anti-socialist, 2019 was the origin of a great turn in my thinking. At the origin of my turn was obviously political humanism in that my original issue with capitalism was violence.

To quote myself from my Collectd Writings, “Capitalism is inherently violent because it normalizes inequality.” Obviously, inequality is going to be a part of any working system in that inequality shows that some parts are going forward. Embracing Darwinism is the cure to anti-capitalism. Once we realize that natural selection happens in real time, anti-capitalist sentiments wash away. I mean I even fundamentally understood this, I just didn’t like it. I said, quoting Morgan, “Equality does not fit into the equation. Capitalism runs on the principle of ‘competition.’”

Following orthodox Marxists such as Zavarzadeh and Tumino, the Labor Theory of value (hereinafter referred to as the LTV) became the second base for my rejection of capitalism.

We will critique the LTV later on. Let’s first address violence and so other critiques.

On Class Violence

The whole argument about crypto-currency that we just went over is that it is just a tool of class oppression and thus rule. In an earlier essay from 2019, I noted that many class-based leftists view racism as a tool used by the bourgeois class to divide the proletariat. They then use this supposed fact to move away from identity politics and toward class-based critique.

Growth is rejected as the basis for the expansion of inequality. Technological advancement is seen as nothing less than an organ of class oppression.

In “A Marxist Critique of Capitalism and its Tools,” I wrote, “The Bourgeoisie suppresses, divides, demeans, and imposes violence on every new generation that goes through the industrial death machine known as capitalism.” This and the idea that the bourgeois class does everything that it can to separate the working class in order to maintain its rule are the fundamental presuppositions of my old beliefs. But is this true? Ultimately, we don’t observe such a thing — empiricality is something I have a disdain for but I digress. That the bourgeois class will do anything to maintain itself obviously doesn’t hold against any basic praxeological critique of polyogism.

An Attempt at Criticism of the Labor Theory of Value

Now, all I aim to critique here is the logical basis of Marx’s notion of value and thus theory of value, as if we critique the object of the theory and render it invalid, would the extrapolations made not too be invalid?

First, what is the fundamental assumption Marx makes? Well, in Capital, he says, quoting Aristotle, “There can be no exchange … without equality, and no equality without commensurability.” He then follows from this, “What is the homogeneous element, i.e. the common substance, which the house represents from the point of view of the bed, in the value expression for the bed?” He finally furthers, “Towards the bed, the house represents something equal … And that is — human labor.”

Again, this is not disputable. Earlier on in Capital, Marx explicitly states this: “The common factor in the exchange relation, or in the exchange-value of the commodity, is therefore its value.”

In response to this, Böhm-Bawerk in Karl Marx and the Close of His System replies,

Where equality and exact equilibrium obtain, no change is likely to occur to disturb the balance. When, therefore, in the case of exchange the matter terminates with a change of ownership of the commodities, it points rather to the existence of some inequality or preponderance which produces the alteration … the old scholastico-theological theory of “equivalence” in the commodities to be exchanged is untenable.

That x=y is a misunderstanding of exchange could absolutely be said. The movement of X — Y is a much more adequate expression of exchange, and one that Marx would agree with if we follow the fact that he does such a symbolic expression with M — C and C — M as well as C — C, and M — M. Contained within X — Y is no equality implied. Böhm-Bawerk does have a point though: on a praxeological level, inequality is implied within exchange in that the exchanger is exchanging only because he finds one state of affairs (pre-exchange) unequal to another state of affairs (post-exchange). He even makes a natural argument, though the appeal is still fundamentally something we can only take notice of and not exactly extricate a principle from:

When composite bodies are brought into close contact with each other new chemical combinations are produced by some of the constituent elements of one body uniting with those of another body, not because they possess an exactly equal degree of chemical affinity, but because they have a stronger affinity with each other than with the other elements of the bodies to which they originally belonged.

Now, even if Marx is right about the idea that exchange requires equivalence, labor is not the only common property of all commodities — 2 warrants: A. Scarcity, being objects of supply and demand, appropriateness, naturality, etc. are all also properties common to all commodities — Marx even admits this. Böhm-Bawerk in Capital and Interest explicates this as follows:

In goods that have exchange value, for instance, is there not also the property of being scarce in proportion to the demand? Or that they are objects of demand and supply? Or that they are appropriated? Or that they are natural products? For that they are products of nature just as they are products of labour no one declares more plainly than Marx himself, when in one place he says, “Commodities are combinations of two elements, natural material and labour;” or when he incidentally quotes Petty’s expression about material wealth, “Labour is its father and the earth its mother.” Now why, I ask, may not the principle of value reside in any one of these common properties, as well as in the property of being the product of labour?

Obviously, when it comes to naturality, Marx rejects that in his movement of boiling away those things which induce use-value and not exchange-value. But, Böhm-Bawerk knew this objection from Marx and promptly responded to it in Captial and Interest:

The first step may pass, but the second step can only be maintained by a logical fallacy of the grossest kind. The use value cannot be the common element because it is “obviously disregarded in the exchange relations of commodities, for “ — I quote literally — ” within the exchange relations one use value counts for just as much as any other, if only it is to be had in the proper proportion.” what would Marx have said to the following argument? In an opera company there are three celebrated singers — a tenor, a bass, and a baritone-and these have each a salary of £1000. The question is asked, What is the common circumstance on account of which their salaries are made equal? And I answer, In the question of salary one good voice counts for just as much as any other — a good tenor for as much as a good bass or a good baritone — provided only it is to be had in proper proportion; consequently in the question of salary the good voice is evidently disregarded, and the good voice cannot be the cause of the good salary. The fallaciousness of this argument is clear. But it is just as clear that Marx’s conclusion, from which this is exactly copied, is not a whit more correct. Both commit the same fallacy. They confuse the disregarding of a genus with the disregarding of the specific forms in which this genus manifests itself. In our illustration the circumstance which is of no account as regards the question of salary is evidently only the special form which the good voice assumes, whether tenor, bass, or baritone. It is by no means the good voice in general. And just so is it with the exchange relations of commodities. The special forms under which use value may appear, whether the use be for food, clothing, shelter, or any other thing, is of course disregarded ; but the use value of the commodity in general is never disregarded. Marx might have seen that we do not absolutely disregard use value from the fact that there can be no exchange value where there is not a use value — a fact which Marx himself is repeatedly forced to admit.

In my opinion, this is a confusing argument that needs more clarity. He does make another argument pertaining to use-value again in Karl Marx and the Close of His System which has much more clarity to it in my opinion:

Is it possible to state more clearly or more emphatically that for an exchange relation not only any one value in use, but also any one kind of labor or product of labor is worth exactly as much as any other, if only it is present in proper proportion? Or, in other words, that exactly the same evidence on which Marx formulated his verdict of exclusion against the value in use holds good with regard to labor? Labor and value in use have a qualitative side and a quantitative side. As the value in use is different qualitatively as table, house, or yarn, so is labor as carpentry, masonry, or spinning. And just as one can compare different kinds of labor according to their quantity, so one can compare values in use of different kinds according to the amount of the value in use. It is quite impossible to understand why the very same evidence should result in the one competitor being excluded and in the other getting the crown and the prize. If Marx had chanced to reverse the order of the examination, the same reasoning which led to the exclusion of the value in use would have excluded labor; and then the reasoning which resulted in the crowning of labor might have led him to declare the value in use to be the only property left, and therefore to be the sought-for common property, and value to be “the cellular tissue of value in use.” I think it can be maintained seriously, not in jest, that, if the subjects of the two paragraphs on page 44 were transposed (in the first of which the influence of value in use is thought away, and in the second labor is shown to be the sought-for common factor), the seeming justness of the reasoning would not be affected, that “labor” and “products of labor” could be substituted everywhere for “value in use” in the otherwise unaltered structure of the first paragraph, and that in the structure of the second paragraph “value in use” could be substituted throughout for “labor.”

Now, again, even if you don’t buy this. Scarcity still specifically allows for quantification just as labor-time does, and therefore would be just as tenable as a principle of value.

B. That all commodities cost money is also a property common to all commodities. Böhm-Bawerk argues this in Karl Marx and the Close of His System when he says, “Or is not the property that they cause expense to their producers — a property to which Marx draws attention in the third volume — common to exchangeable goods?”

Now, lastly, when looking at Marx’s theory of capital which is intimately related to his theory of surplus value, some objections can also be raised: Marx is wrong about variable capital being the only source of surplus value and then profit. The phenomena of interest disproves — 2 warrants: A. The phenomena of interest allows constant capital to yield a potentially infinite amount of profit without anything being done. Therefore, meaning that constant capital is far from dead weight like Marx says it is. In Capital and Interest, Böhm-Bawerk has absolutely beautiful explication of this:

It is generally possible for any one who owns capital to obtain from it a permanent net income, called Interest. This income is distinguished by certain notable characteristics. It owes its existence to no personal activity of the capitalist, and flows in to him even where he has not moved a finger in its making. Consequently it seems in a peculiar sense to spring from capital, or, to use a very old metaphor, to be begotten of it. It may be obtained from any capital, no matter what be the kind of goods of which the capital consists: from goods that are barren as well as from those that are naturally fruitful ; from perishable as well as from durable goods ; from goods that can be replaced and from goods that cannot be replaced ; from money as well as from commodities. And, finally, it flows in to the capitalist without ever exhausting the capital from which it comes, and therefore without any necessary limit to its continuance. It is, if one may use such an expression about mundane things, capable of an everlasting life. Thus it is that the phenomenon of interest, as a whole, presents the remarkable picture of a lifeless thing producing an everlasting and inexhaustible supply of goods. And this remarkable phenomenon appears in economic life with such perfect regularity that the very conception of capital has not infrequently been based on it.

B. Time is itself a positive economic force that allows constant capital to create profit through interest. In her Ph.D. thesis Capitalism’s Transcendental Time Machine, Anna Greenspan makes this point perfectly:

Capitalism, according to Boehm-Bawerk, is characterized by a switch away from direct production in which the existence of the good immediately follows the expenditure of labour” to what he calls ‘roundabout production’ in which the means of production are themselves produced. … Boehm-Bawerk thus departs from Marx in developing a theory in which change in constant capital has a fundamental role both for the creation of profit and for the circulation of capital. For Boehm-Bawerk, then, the time of technological innovation, research and development is inserted as a positive force in the economy. For the crucial fact about roundabout production is that while it obtains a greater result and yields a larger final product than direct production (it is obviously ultimately more efficient to get your water from a tap than to have to go to the river each day to collect it) it does so by sacrificing time. Roundabout production is ‘time consuming’. … For it is by means of interest that capitalism is able to profit on the sacrifice of time inherent in its mode of production. Boehm -Bawerk’s “positive theory of capital”, then, rests on twin forces of time in which the temporal delay of roundabout production is compensated by the phenomenon of interest.

Ultimately though, I remember talking with Jasper that it seemed likely that capitalists will begin to set prices higher than the natural price (which is the monetary expression of the value of the commodity as Marx argues in Value, Price, and Profit) in order to displace, so to speak, the rate of profit to fall. My friend Jack has argued with me in the past that this isn’t possible because of the labor theory of value, and of course, that the rate of profit to fall as a contradictive tendency, again, so to speak, is entailed by the labor theory of value is why I even see the labor theory of value to have any theoretical purchase on anything at all. But, we have critiqued its basis, and it is now time to provide an alternative, which is to say, other than labor, what do we claim to be the principle of value?

But, what works in the place of Marx’s labor theory of value?[1] We have seen that use-value can be the principle of value in that all commodities have utility and it can be quantitatively recognized, and in certain respects is syntactically interchangeable with Marx’s usage of labor is certain parts of Capital, but does that mean we follow Menger and Böhm-Bawerk in their marginal utility theory of value? It seems so. That exchange is either equal or inequal seems so logically and that we reject its equal nature due to the fact that an expression of equality is not symbolically valid as 5X — 7Y is much better. That 5 beds, to follow Aristotle, is equal to $500 and 1 house is equal to $700 means exactly this, 5 beds ≠ 1 house, yet can they be exchanged for one another? Yes! So, on a very basic level, equality is not a praxeological requisite, which is to say, requisite for the action of exchange. But, that praxeology is involved is important because the subject and specifically subjective action comes into play. But that exchange is a form of action, equality in a certain sense is prohibited from this. X≠Y. Exchange is really the exchange of one state of affairs to another. X, one state of affairs, for another, Y. And action is the proof of this inequality! That a subjective theory of value is praxeologically necessitated is certain. A subjective theory of value is one of subjective utility, one of subjective demand and objective supply. That natural prices are a preposterous idea from Smith and that market prices are all that is within the market is another certainty it seems.

Let us to return to Aristotle and the issue of ratios. That 4X:1Y then tells me that within that exchange between those two people 1X exchanges for 0.25Y or 1X:0.25Y. But, during another exchange, 5X was exchanged for 5Y. Then we realize that between those two people, the exchange ratio would be 1X:1Y. That prices allows for exchange is already a simple conclusion that can be made. As Ian Sturdy says in his Aristotle’s Theory of Just Exchange, “In cases where there is no natural relation between two units, there may be a postulated one; one can, for example, convert between units of a good and money at a price(so many dollars per unit), despite the units not being equivalent.” Thus, that equality/equivalence is required is not true. Subjects can be those postulators who lay the necessary conditions for exchange ratios. In a certain sense, that things are set by active socialities is an argument that reminds me of Reza Negarestani’s argument relating to the socio-semantic basis of the mind as a teleonomy, but I digress. Also do note that in A Contribution to the Critique of Politicl Economy, Marx admits that commensurability within exchange is achieved by Aristotle “by means of money.” That exchange existed before money is also true. But again, subjects can still act as postulators.

Again, I will note that my relationship to value theory will always be complex in that I currently maintain no theory of value. Consider all you have read with a grain of salt — I’m sure I will do the same in a few days time!

Notes

[1]: I do want to note that some, such as my great friend Jojo, hold that Marx in fact never believed in the labor theory of value. This is an interesting argument but it is also a semantic one. The transformation problem is not an issue for my friend Jojo, for example, because he believes that Marx was only demonstrating another contradiction within capitalism, within political economy, itself. Essentially, for Jojo then, in a socialist society, the labor theory of value would not hold true. The issue with this I find is its semantic use of belief as “Well, Marx believed in socialism not capitalism, and therefore didn’t believe in those properties of political economy such as the labor theory of value.” Another issue is the fact that this just doesn’t hold up against Marx’s fundamental argument from Aristotle that exchange necessitates equality. The reason this latter fact is a defeater for a belief such as “Marx didn’t believe in the labor theory of value” is because it demonstrates that exchange has been the same before capitalism, in Aristotle’s times, and during capitalism, and thus also after capitalism. That labor is the common element of commodities, which are oddly and specifically seen as products of labor that have a utility and are exchanged but seen as other things in other parts of Capital as Böhm-Bawerk abstractly recognizes in Karl Marx and the Close of His System, should not change, if Marx is right, in a socialist society. In this sense, Marx did in fact believe in some sort of labor theory of value in that abstract human labor is forever the principle of value.