[ALB]

Went to this meeting yesterday but only participated in the sessions on Participatory Economy and Participatory Politics.  They are not as radical as they seem on paper, seeming just to want to make life as it is today more “participatory”.We have already clashed with them over their views on the economy where they want to retain pay (related to effort) and to continue to restrict people’s consumption to their work effort and so have to put a price on goods and services too. They talk about abolishing money but only in favour of credits which one of them said he was prepared to call “consumer money”.They talk of a “vision” but in fact they offer a blueprint and not a very nice one at that, as one where everybody has to fill in a form at the beginning of the year setting out what they plan to consume in the year and which has to be scrutinised by neighbourhood councils. It’s the same at work: everybody has to fill in a form saying how much effort they will put in and which will be monitored not by management (as today) but by fellow workers (which surely would be worse). And their proposal for repeated revisions (at least 7) to a provisional plan so as to eventually bring supply and demand into balance must be a joke (we’d be spending all our time in meetings); not that it would work anyway.Having said that, their views on “participatory politics” based on ideas put forward by Stephen Shalom are more sensible and correspond more or less to the sort of participatory democracy that we envisage existing in socialism but in the context of a moneyless, wageless society of common ownership and free access.We are not the only ones to criticise “parecon”. Here’s two more, detailed criticisms:Can participatory economics tame marketplace relations?An anarchist society that wallows in regulationAnother critic has described it as “nonsense on stilts”.

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Are we sure this isn’t one of his (Charlie Veitch of the Love Police) spoof videos?As to Stefan Molyneux, there’s a good point-by-point refutation of this mad marketeer by Peter Joseph here.It’s 50 minutes but everything is there: refutation of the ideas that capitalism has or could exist without the state; that resources are finite and desires are infinite; that without prices, efficient resource allocation is impossible; that the calculation problem is insurmountable; etc. In fact, this is one of the best (if not the best) video refutation of the so-called “economic calculation argument” on the internet as well as putting the case for a money-free world of abundance and open access. And it’s been seen by over 68,000.

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I made a mistake.  Chris Bambery resigned from the SWP last year. But he’s still a Trotskyist. In ant event, here is the passage where he suggests that an independent Scotland might be able to avoid austerity:

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However, on a more positive note, in campaigning for a “yes” vote for independence we can promote the argument for an “anti-austerity Yes vote”. Cameron (and now British Labour Party leader Ed Miliband) wants to doom us to at least a decade of austerity. By campaigning for Scotland to escape that nightmare we can fight for our vision of a new society and that can help build resistance south of the border.

He can campaign (and vote) as much as he likes against the nightmare of prolonged austerity but it won’t make any difference as that’s what capitalist conditions demand at the moment. Better to campaign, like us, to replace capitalism with socialism.In the meantime the Links site in Australia has published comments by two members. Go here and scroll down.

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In the 5th (1962) edition when discussing so-called “perfect competition” Samuelson does talk of “any positive profits (in excess of a ‘normal return’ on capital and labor invested) will in the long-run equilibrium be competed away” (p. 542) and of “the most perfect competition (where pure profit is zero)” (p.660). Perhaps this inconsistent distinction between “interest” and “profit” reflects a confusion in the minds of academic apologists for capitalism as to the best way to defend the income of the capitalist class.If they want to call profit “interest”, fair enough. But, in the present situation, where banks and “interest” have become a dirty word they may have backed a loser. Expect another change of emphasis in future editions of Samuelson’s Economics.I think this distinction goes back further than the “marginalist revolution in economics”. It’s also in Henry George’s Progress and Poverty (that I’ve been re-reading after getting into an argument with a Georgeist at Occupy St Pauls) which was first published in 1880. Here’s how he summarised the conclusion of Chapter 10 on “the laws of distribution”:

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Land, labor, and capital are the factors of production. Land includes all natural opportunities or forces. Labor includes all human exertion. Capital includes all wealth used to produce more wealth.The output is distributed in returns to these three factors. Rent is that part that goes to owners of land as payment for the use of natural opportunities. Wages are that part that constitutes the reward for human exertion. Interest is that part that constitutes the return for the use of capital.

In Chapter 13 entitled “False Interest” (but in the book edition I have “Of spurious capital and of profits often mistaken for Interest”) he says:

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Profits properly due to the elements of risk are also frequently mislabeled interest. Some people acquire wealth by taking chances in ventures where most suffer losses. There are many such forms of speculation, especially that method of gambling known as the stock market. Nerve, judgment, and possession of capital give an advantage. Also, those skills known as the arts of the confidence man. But, just as at a gaming table, whatever one person gains someone else must lose.Everyone knows the tyranny and greed with which capital, when concentrated in large amounts, is frequently wielded to corrupt, rob, and destroy. What I wish to call the reader’s attention to here is this:These profits should not be confused with the legitimate returns of capital as an agent of production. Any analysis will show that much of what is commonly confused with interest is really the result of the power of concentrated capital. For the most part, this should be attributed to bad legislation, blind adherence to ancient customs, and superstitious reverence for legal technicalities.Examine the great fortunes said to exemplify the accumulative power of capital: the Rothschilds, the Vanderbilts, the Astors. They have been built up, to a greater or lesser degree, by the means we have been reviewing — not by interest.

In other words, precisely the arguments employed by Steele, though George placed himself on the left, seeing “profits” as bad and arguing in the preface to the first edition that “laissez-faire (in its full true meaning) opens the way to a realisation of the noble dreams of socialism” !

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Just thought. I wonder what our comrades in the WSP(NZ) think of this.

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Interesting. I see from following your link that as long ago as 2007 this NZ organisation’s What We Stand For started:

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Profit, the fuel of capitalism, flows from the dual exploitation of labour and nature

Maybe this is what the “CPGB” would like the SWP here to adopt? In any event, it is wrong. Profit arises from the exploitation of labour. No doubt capitalism mistreats nature but this is not the same sense of “exploitation”.”Exploitation” is not the same as mistreatment. Even if workers are not mistreated at work, eg by bullying foremen or dangerous working conditions, they are still exploited in the Marxian sense.To come back to JonDWhite’s original point about “wealth” and “value”, workers under capitalism produce wealth (from and with materials that originally came from nature) in the form of value, but only get paid the value of their labour power (their working skills) not the value of what they produce. The difference is surplus value, ie  they produce more value than the are paid for. That is the sense in which they are exploited. Nature contributes nothing to the creation of value (as opposed to wealth) and so not to profits (which derive from labour-produced surplus value alone).

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Reluctant as I am to defend the SWP I have to say that the “CPGB”‘s criticism of them on this is very petty. To say that “the workers create all wealth under capitalism” is not all that bad and misleading. Only work creates wealth (ie transforms parts of nature into something useful to humans) and this is as true under capitalism as under any other form of society. So the SWP statement is basically correct.The “CPGB” claim that this ignores nature and their speaker gives a garbled version of a quote that Marx used from the 17th century economic writer Sir William Petty about calling “labour the father and earth the mother of wealth”. Apparently this is what the “CPGB” would like the opening words of the SWP’s “What We Stand For” statement to be.What Marx wrote, in the opening pages of Capital, was:

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When man engages in production, he can only proceed as nature does herself, i.e. he can only change the form of the materials. Furthermore, even in this work of modification he is constantly helped by natural forces. Labour is therefore not the only source of material wealth, i.e of the use-values it produces. As William Petty says, labour is the father of material wealth, the earth is its mother.

The “CPGB” are playing on the difference between labour “creating” wealth and labour “being the source” of wealth. The SWP statement does not say (as the Gotha Programme did and which Marx criticised for it doing so) that labour is the source of wealth but only that it creates, or produces, it.What Petty actually wrote was (Marx must have been quoting from memory):

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Labour is the Father and active principle of Wealth, as Lands are the Mother.

Which is even stronger than what Marx remembered him saying to back up the view that all wealth results from work (on nature-given materials). It also refutes the “CPGB”‘s speaker’s view that nature is more important than labour in the creation of wealth because a mother does more than a father in the creation of babies. They seem to have gone all Green by giving more importance to Mother Earth than to the Working Class.The new SWP formulation that “under capitalism workers’ labour creates all profit” is not wrong either.

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DJP wrote:

Not sure if you’re confusing profits with super profits?

I don’t think Robin is but Walras and Steele certainly are. Both definitely meant the profits that accrue to firms because of some market condition over and above “normal” profits which they disguise under the name of “interest” (which is somehow mysteriously generated by fixed capital).Their definition is not followed by other bourgeois economists. For instance, here’s what Paul Samuelson writes in his widely-used textbook about the same imaginary situation envisaged by Walras where price (P) is exactly equal to long-run costs:

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Under such conditions of free “replication,” is it not obvious that long-run P cannot remain above this same critical breakeven point at which they all cover their long-run total costs—including in these(1) all labor, materials, equipment, tax and other expenses;(2) all wages payable to the identical managers at the level determined competitively by the bidding in all industries for people of such talents and industriousness; and(3) the interest yield that any of them could get on the amounts of capital that they tie up in this industry instead of investing it elsewhere?These “full competitive costs” are seen to include more than accountants usually include in costs: they include a normal return to management services, as determined competitively in all industries; and a normal return to capital as determined competitively everywhere by industries of equal riskiness. In the above sense we may say that “normal profits” are included in costs and that “excess profits” are competed away by entry and “abnormal losses” are eliminated by long-run exit of firms (Economics, 5th edition, pp.470-1).

Of course Walras’s “generalised equilibrium” is only a mathematical construct that is never realised and in fact never could be realised under capitalism, but despite this is considered by most bourgeois economists to be the normal state of capitalism. Capitalism in fact is in a permanent state of disequilibrium brought out precisely by firms seeking “super profits” and leading to recurring cycles of boom and slump.

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ALB wrote:

The Occupy movement in London seems to be sinking lower and lower as the panel of speakers for this meeting on Sunday 15 January seems to show:

I may have been a little harsh as the audience of 100 or more at the meeting applauded those panellists who said they were “anti-capitalist” and critcised and even heckled those wouldn’t. So the spirit of anti-capitalism, however vague, still seems to be abroad amongst many occupiers.  The organiser had just set out to invite a panel of speakers suggested by members of the Occupation’s Economics Working Group and which he thought would be interesting without endorsing their views.Hopefully, the non-anti-capitalist performance of such speakers as Robin Smith, Ben Dyson and Fred Harrison will have discredited their views.  Of course even those who did declare themselves “anti-capitalist” weren’t in our sense, but it’s still good that capitalism should be a dirty word and we’ll get a better hearing from those who think it is than from those who don’t.I have to say, though, that interesting as the meeting was it could have taken place a 100-150 years ago, with speakers advocating interest-free banking (Proudhon), to tax away ground rent (JS Mill and Henry George), and co-operative societies (Robert Owen). Which are even less the way out today than they were then.

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Romney’s views on capitalism and capitalist corporations may be conventional but his religious views are positively weird. As a Mormon he believes (and he really does as he was a bishop in that sect) that an angel called Moroni visited Joseph Smith in the 1820s and revealed to him where to find the Book of Mormon and that their god lives on a planet called Kolob. Mind you, Mohamet claimed the same sort of thing and christian claims about their demi-god are even more moronic. If Romney becomes US president David Icke will be able to entertain the hope that some day he can become prime minister of Britain.

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Brian wrote:

In regards to use-values being subjective and therefore not capable of being measured into a common unit I have to disagree.  What about  the calculation in kind solution being used has a form of measuring use-value?

Of course different quantities of the same use-value can be compared in a single unit, whether that be number, weight, volume or whatever. What cannot be compared in a single unit are, for instance, steel (tonnes) and electricity (killowatt hours).Calculation in kind  will be calculation of the various use-values used (or useable) in production, but in their specific units, not in a common unit such as value and money as under capitalism. As a matter of fact calculation in kind (ie in use values) already occurs under capitalism, only it is duplicated by calculation in money. In socialism we will dispense will calculation in money and calculate in kind and make decisions on what to produce and how on this basis.

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What? us? !!Didn’t you forget this:

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Just listened to this and he himself is not advocating “a World Without Money” whatever the organiser of the event at which he spoke might have in mind. The argument he puts forward about a society charging interest being mathematically impossible in the long run because it requires an impossible exponential growth was refuted long ago by Marx in chapter 24 of Volume III of Capital where he quotes the Rev Dr Richard Price as writing in 1774:

Quote:

Money bearing compound interest increases at first slowly. But, the rate of increase being continually accelerated, it becomes in some time so rapid, as to mock all the powers of the imagination. One penny, put out at our Saviour’s birth to 5 per cent compound interest, would, before this time, have increased to a greater sum, than would be contained in a hundred and fifty millions of earths, all solid gold.

and comments:

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But Price entirely forgets that the interest of 5% presupposes a rate of profit of 15%, and assumes it to continue with the accumulation of capital. He has nothing whatsoever to do with the actual process of accumulation, but rather only with lending money and getting it back with compound interest. How that is accomplished is immaterial to him, since it is the innate property of interest-bearing capital.

Professor Hörmann makes the same mistake. The capitalist economy does not expand because banks lend at compound interest but because workers produce surplus value. As interest has to be paid out of surplus value it cannot be greater than this and in fact is a great deal smaller. It is profit not interest that drives the capitalist economy.

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The Occupy movement in London seems to be sinking lower and lower as the panel of speakers for this meeting on Sunday 15 January seems to show:

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11:15-1pm: Session 1: Tax and GovernmentRichard Murphy (Tax Justice Network)Gordon Kerr (Cobden Partners)Robin Smith (Systemic Fiscal Reform)1pm-1:30pm Lunch Break1:30pm-2:15pm: Session 2: Money and SocietyBen Dyson (Positive Money)Dada Jii (Progressive Utilization)Peter Challen (Global Justice Movement)2:15pm-4pm: Session 3: Land, Commons and Cooperative EconomicsDerek Wall (Green Party, Goldsmiths)Fred Harrison (Land Research Trust)Cliff Mills (Mutuo)

Bem Dyson is a currency crank who thinks banks can create money out of thin air and who supports way-out Tory MPs Douglas Carswell and Steve Baker. Robin Smith is a supporter of Henry George (who stood for free market capitalism) and wants to stand at the next general election as a Tory candidate. Fred Harrison is another follower of Henry George who argues that George “proposed qualitative changes that would have built equity and greater efficiency into the capitalist mode of production”. The only person who knows anything about socialism as we understand it is Derek Wall who knows us well.Anyway, some of us will be there to leaflet and take part in the discussion as the meeting should attract some who really do want to go “beyond capitalism” and who won’t be interested in mere banking and/or land and/or tax reform.

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Of course wealth (useful things fashioned from materials that originally came from nature) will continue to exist in socialism. It’s only exchange value that won’t exist (won’t come into existence since wealth will no longer be produced to be bought and sold). Wealth and use-values are the same or, rather, wealth is made up of use-values.The thing about use-value is that it is subjective in that what is considered (valued as) useful by one person or group of persons is not necessarily so considered by another person or group and so can’t be measured in a common unit in  the way that exchange value can.Socialist society will have to decide what it is useful (what use values) to produce and then individuals can decide what is useful to them and take this from the distribution centres without the goods (use-values) being priced and without having to hand over money or use a card.

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