robbo203
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robbo203 wrote:Let’s remind ourselves what the nub of this interesting debate is about. The Marxist view is that increasing productivity, resulting from technological innovation, means a decline in unit costs and in the value content of individual commodities themselves. This is because only living labour can create new values; machines only transfer the value already contained in them. So as machines increasingly replace human labour, the effect should be a reduction in the value content of these commodities. That in turn should result in a lowering of prices since on average, over the long run, commodity prices broadly reflect their values – the amount of socially necessary abstract labour required to produce them. That isnt happening, according to Michel so there must be some flaw in Marx's theory: " In fact, increasingly post-industrial, post-modern bourgeois-state-capitalism is abandoning, with the advent of ever-increasing automation, the limited parameters manufactured by socially necessary labor-time in favor of the unlimited parameters manufactured by conceptual-commodity-value-management, namely, arbitrary, socially constructed value, price and wage-determinations. " According to Michel, the long run determination of market prices by labour values no longer really applies. It has been marginalised, rendered irrelevant and finally transcended by a mysterious new factor – namely the “creative power” of capitalists to arbitrarily assign prices to commodities just as they chose in their relentess desire to “accumulate profit, ad infinitum” (when did capitalists not desire to “accumulate profit, ad infinitum”, you might well ask!) . So contrary to the expectation that increased productivity by increasing output should cause prices to fall, the opposite is true, he claims. Prices are actually rising despite production costs falling (and I assume he is talking here of both prices and costs of production being adjusted for inflation). As he puts it: “Marx was wrong to think that capitalists would lower prices when production costs went down. To circumvent this faulty Marxist logic, capitalists simply made deals among themselves within their specific industries to limit competition among themselves so as to keep profits high and ever-increasing”. I have asked Michel for large-scale economy-wide data to back up this claim but he has yet to provide this data. It’s easy enough to provide anecdotal evidence of individual prices outstripping their costs of production which may indeed be falling. I have given examples of this myself in the case of certain branded “status goods”. Their prices have risen sharply thanks in part to the aggressive marketing of such goods while the costs of producing them have fallen as result of outsourcing to various Third world countries where labour is much cheaper. But in no way does this contradict the Marxian view that increasing productivity tends to cheapen the commodities being produced. Nor does the fact the wage increases may temporally dip below price increases from time to time – causing living standards to drop – prove Michel’s basic point that the capitalists can just arbitrarily raise prices by exerting their “creative power”. They can’t. Rather what this shows instead is the weakened bargaining position of workers vis-à-vis the capitalists – for example, at a time of economic recession. In other words that would be misinterpreting what is happening as evidence to support his central argument. It doesn’t demonstrate the freedom of the capitalists to just arbitrarily raise prices to whatever they want but rather the relative lack of freedom of workers to resist the downward pressure on wages in an economic recession. Not only that, there is a huge problem with his whole argument which Michel does not appear to see. If capitalists can just arbitrarily raise their prices or keep their prices high in the face of declining unit production costs then why don’t those capitalists that provide the inputs upon which other capitalists depend to manufacture their commodities, likewise raise the prices of THEIR commodities so that the unit costs of production of those other capitalists, instead of falling will be rising? Why is it assumed that only the producers of final goods are able to circumvent the need to undercut their rivals by limiting competition between themselves but not the producers of intermediate goods – that is, the goods that constitute the inputs needed to make other goods? This makes no sense. Are not the producers of intermediate goods also driven by the need to “accumulate profit, ad infinitum” ? So what is so special about the producers of final goods that enables them to hold down their costs of production but increase the price of the commodities they sell to whatever they want, which the producers of intermediate goods cannot do? Michel does not explain. There is a further point to consider and I have pressed Michel on this but have yet to receive a satisfactory answer. The costs of production, include crucially, labour costs – the wages bill. If these latter are slipping further and further behind rising prices (which have supposedly been arbitrarily raised by the capitalists whose “greed continually short-circuits Marx's elegant, scientifically quantifiable labor-time analysis” – at least in the advanced capitalist countries) then this begs all sorts of questions – not the least of which is why have these capitalists chosen now in this supposed post-modern era we are living in, to assert their “greed” in this way and only in the advanced capitalist economies, not the third world economies where Michel concedes Marx’s theory is “still valid” Let’s look at this claim more closely. The point of a business producing a commodity is to sell it and to realise a profit by doing so. So what is the point of pitching the price of a commodity so high that it cannot be sold and particularly when all that will do is force consumers to turn to some other, cheaper, supplier? If real wages are declining as part of the general decline in the costs of production then this would be even truer – workers would have even more reason to look around for the best possible bargain in the market. As a capitalist you would need to reduce your prices accordingly so that the good in question is not beyond the pocket of your potential customer – if you are to attract their custom. Otherwise you will just be left with a whole bunch of unsold goods and there is no point in that – is there? If capitalists are truly motivated by the desire to accumulate profit as Michel says then it is absolutely essential that they sell their commodities in the first place and that means selling them at a price that is not going to encourage their customers to look elsewhere. It seems to me that the only way in which he can sustain his argument and make it sound remotely plausible is if he were to argue that there are certain kinds of commodities that are simply indispensable to workers such that they cannot do without them and that the capitalists supplying these commodities can somehow conspire together with their commercial rivals to agree to push up the price of these commodities and not to break rank with each other – in other words to suspend the normal struggle between themselves over the size of the market share they command. In an increasingly globalised economy that seems even less unlikely but even if such a price fixing conspiracy could be organised and adhered to, this does not get round another very basic problem which Michel completely neglects to address. The problem is this. The opportunity costs of consumers having to pay more for these particular commodities means EITHER that they will have to buy less of these (now more expensive) commodities OR if they continue to purchase these commodities at the same volume as before, that these consumers will then have less money to spend on other commodities. That is to say, the market demand for these other commodities will fall and so the capitalists supplying these other commodities will be obliged to reduce their prices accordingly if they are not to be left with huge stockpiles of unsold goods at the end of the day. Either way the outcome will be the same – namely to validate the basic point that you cannot just arbitrarily raise prices beyond what the market can sustain from the standpoint of the economy as a whole. Certainly you can modify the pattern of demand but there is a zero sum game at work here to which Michel seems quite oblivious To fill in the huge gaping holes in his argument, Michel introduces another factor – debtOf course, the working population is seemingly making more money, today, but this is not true, as prices have been increasing at a faster rate then wages/salaries, and compounded with an ever-increasing ability to BORROW, means that an illusion of wealth grounded in debt is enveloping and masking the true nature of living in post-industrial, post-modern capitalist society, opulent poverty. This illusion of wealth is masking a fundamental contradiction, a poverty clothed in opulence, where the majority of the working population are inundated with commodities and luxury goods, goods that they do not really own outright, but make monthly or bi-weekly payments upon, debt peonage/Debt slavery masked in seeming opulence. Unless I have misunderstood him here, what he seems to saying is that the growing gap between falling wages and rising prices is something that is increasingly being filled by workers taking out loans and falling into debt. Ironically, Michel himself talks of this development as signifying simply an “illusion of wealth” and, in so doing, unwittingly confirms the validity of the Marxian theory rather than repudiates it. All debt does is delay the inevitable rather than banish it. You can’t just conjure market demand out of thin air. You can’t just spend your way out of a crisis as the Keynesians would have it with their talk of “demand management” and pump priming. There remains still the key point about the labour theory of value which Michel simply skirts over but which is fatally damaging to his whole argument – namely that at the end of the day, the sum total of prices in a capitalist economy must equate with the sum total of values generated in that economy. This is because value, as a magnitude signifying socially necessary abstract labour, only reveals itself in exchange – in exchange value or the proportions in which commodities exchange. Some goods can indeed sell at a price above their notional value but the necessary corollary of this is that other goods must sell at a price below their notional value. That means it is literally impossible that goods in general or in the aggregate can sell at a price above their value. Of course, it is quite true that the relative share of the social product that the workers receive in the form of their wages can vary upwards or downwards. For instance, according to the Economic Policy Institute, between 1979 and 2009 U.S. productivity increased by 80 percent, while the hourly wage of the median American worker went up by only 10.1 percent. ("The Sad But True Story of Wages in America", Lawrence Mishel and Heidi Shierholz, Economic Policy Institute, Issue Brief no.297, March 14, 2011). In other words most of the gains in productivity went to the super rich – the top 1%. While the real wages of workers grew by very little they nevertheless grew- thus disproving the suggestion that living standards have declined because capitalists can arbitrarily or permanently raise the prices that workers have to pay for goods above what workers are themselves paid in the form of wages. The mistake that Michel makes is to assume that the capitalists have increased their wealth in the form of profits simply by putting up prices. But profit is not made at the point of sale. Rather, it is made at the point of production and is only realised at the point of sale. In other words he is misinterpreting the growing share of social product going to the capitalists as evidence for saying the labour theory of value is no longer relevant when what it is really signifying is an increase in the rate of exploitation which is precisely what the theory seeks to demonstrate. The increased debt that workers are saddled with these days is simply a reflection of the increased share of the economic surplus appropriated by the financial capitalists and banking sector at the expense of the traditional industrial capitalists. It is not a magic money tree that allows the system to bridge the gap between falling costs of production and the ever rising price of commodities brought about by the capitalists suddenly deciding to become terribly greedy in the last two or three decades or so.
There is a usful link here which might throw more light on some of the arguments presented above https://libcom.org/library/marxian-economics-curriculum-1935-iww-work-peoples-college
Let’s remind ourselves what the nub of this interesting debate is about. The Marxist view is that increasing productivity, resulting from technological innovation, means a decline in unit costs and in the value content of individual commodities themselves. This is because only living labour can create new values; machines only transfer the value already contained in them. So as machines increasingly replace human labour, the effect should be a reduction in the value content of these commodities. That in turn should result in a lowering of prices since on average, over the long run, commodity prices broadly reflect their values – the amount of socially necessary abstract labour required to produce them. That isnt happening, according to Michel so there must be some flaw in Marx's theory: " In fact, increasingly post-industrial, post-modern bourgeois-state-capitalism is abandoning, with the advent of ever-increasing automation, the limited parameters manufactured by socially necessary labor-time in favor of the unlimited parameters manufactured by conceptual-commodity-value-management, namely, arbitrary, socially constructed value, price and wage-determinations. " According to Michel, the long run determination of market prices by labour values no longer really applies. It has been marginalised, rendered irrelevant and finally transcended by a mysterious new factor – namely the “creative power” of capitalists to arbitrarily assign prices to commodities just as they chose in their relentess desire to “accumulate profit, ad infinitum” (when did capitalists not desire to “accumulate profit, ad infinitum”, you might well ask!) . So contrary to the expectation that increased productivity by increasing output should cause prices to fall, the opposite is true, he claims. Prices are actually rising despite production costs falling (and I assume he is talking here of both prices and costs of production being adjusted for inflation). As he puts it: “Marx was wrong to think that capitalists would lower prices when production costs went down. To circumvent this faulty Marxist logic, capitalists simply made deals among themselves within their specific industries to limit competition among themselves so as to keep profits high and ever-increasing”. I have asked Michel for large-scale economy-wide data to back up this claim but he has yet to provide this data. It’s easy enough to provide anecdotal evidence of individual prices outstripping their costs of production which may indeed be falling. I have given examples of this myself in the case of certain branded “status goods”. Their prices have risen sharply thanks in part to the aggressive marketing of such goods while the costs of producing them have fallen as result of outsourcing to various Third world countries where labour is much cheaper. But in no way does this contradict the Marxian view that increasing productivity tends to cheapen the commodities being produced. Nor does the fact the wage increases may temporally dip below price increases from time to time – causing living standards to drop – prove Michel’s basic point that the capitalists can just arbitrarily raise prices by exerting their “creative power”. They can’t. Rather what this shows instead is the weakened bargaining position of workers vis-à-vis the capitalists – for example, at a time of economic recession. In other words that would be misinterpreting what is happening as evidence to support his central argument. It doesn’t demonstrate the freedom of the capitalists to just arbitrarily raise prices to whatever they want but rather the relative lack of freedom of workers to resist the downward pressure on wages in an economic recession. Not only that, there is a huge problem with his whole argument which Michel does not appear to see. If capitalists can just arbitrarily raise their prices or keep their prices high in the face of declining unit production costs then why don’t those capitalists that provide the inputs upon which other capitalists depend to manufacture their commodities, likewise raise the prices of THEIR commodities so that the unit costs of production of those other capitalists, instead of falling will be rising? Why is it assumed that only the producers of final goods are able to circumvent the need to undercut their rivals by limiting competition between themselves but not the producers of intermediate goods – that is, the goods that constitute the inputs needed to make other goods? This makes no sense. Are not the producers of intermediate goods also driven by the need to “accumulate profit, ad infinitum” ? So what is so special about the producers of final goods that enables them to hold down their costs of production but increase the price of the commodities they sell to whatever they want, which the producers of intermediate goods cannot do? Michel does not explain. There is a further point to consider and I have pressed Michel on this but have yet to receive a satisfactory answer. The costs of production, include crucially, labour costs – the wages bill. If these latter are slipping further and further behind rising prices (which have supposedly been arbitrarily raised by the capitalists whose “greed continually short-circuits Marx's elegant, scientifically quantifiable labor-time analysis” – at least in the advanced capitalist countries) then this begs all sorts of questions – not the least of which is why have these capitalists chosen now in this supposed post-modern era we are living in, to assert their “greed” in this way and only in the advanced capitalist economies, not the third world economies where Michel concedes Marx’s theory is “still valid” Let’s look at this claim more closely. The point of a business producing a commodity is to sell it and to realise a profit by doing so. So what is the point of pitching the price of a commodity so high that it cannot be sold and particularly when all that will do is force consumers to turn to some other, cheaper, supplier? If real wages are declining as part of the general decline in the costs of production then this would be even truer – workers would have even more reason to look around for the best possible bargain in the market. As a capitalist you would need to reduce your prices accordingly so that the good in question is not beyond the pocket of your potential customer – if you are to attract their custom. Otherwise you will just be left with a whole bunch of unsold goods and there is no point in that – is there? If capitalists are truly motivated by the desire to accumulate profit as Michel says then it is absolutely essential that they sell their commodities in the first place and that means selling them at a price that is not going to encourage their customers to look elsewhere. It seems to me that the only way in which he can sustain his argument and make it sound remotely plausible is if he were to argue that there are certain kinds of commodities that are simply indispensable to workers such that they cannot do without them and that the capitalists supplying these commodities can somehow conspire together with their commercial rivals to agree to push up the price of these commodities and not to break rank with each other – in other words to suspend the normal struggle between themselves over the size of the market share they command. In an increasingly globalised economy that seems even less unlikely but even if such a price fixing conspiracy could be organised and adhered to, this does not get round another very basic problem which Michel completely neglects to address. The problem is this. The opportunity costs of consumers having to pay more for these particular commodities means EITHER that they will have to buy less of these (now more expensive) commodities OR if they continue to purchase these commodities at the same volume as before, that these consumers will then have less money to spend on other commodities. That is to say, the market demand for these other commodities will fall and so the capitalists supplying these other commodities will be obliged to reduce their prices accordingly if they are not to be left with huge stockpiles of unsold goods at the end of the day. Either way the outcome will be the same – namely to validate the basic point that you cannot just arbitrarily raise prices beyond what the market can sustain from the standpoint of the economy as a whole. Certainly you can modify the pattern of demand but there is a zero sum game at work here to which Michel seems quite oblivious To fill in the huge gaping holes in his argument, Michel introduces another factor – debtOf course, the working population is seemingly making more money, today, but this is not true, as prices have been increasing at a faster rate then wages/salaries, and compounded with an ever-increasing ability to BORROW, means that an illusion of wealth grounded in debt is enveloping and masking the true nature of living in post-industrial, post-modern capitalist society, opulent poverty. This illusion of wealth is masking a fundamental contradiction, a poverty clothed in opulence, where the majority of the working population are inundated with commodities and luxury goods, goods that they do not really own outright, but make monthly or bi-weekly payments upon, debt peonage/Debt slavery masked in seeming opulence. Unless I have misunderstood him here, what he seems to saying is that the growing gap between falling wages and rising prices is something that is increasingly being filled by workers taking out loans and falling into debt. Ironically, Michel himself talks of this development as signifying simply an “illusion of wealth” and, in so doing, unwittingly confirms the validity of the Marxian theory rather than repudiates it. All debt does is delay the inevitable rather than banish it. You can’t just conjure market demand out of thin air. You can’t just spend your way out of a crisis as the Keynesians would have it with their talk of “demand management” and pump priming. There remains still the key point about the labour theory of value which Michel simply skirts over but which is fatally damaging to his whole argument – namely that at the end of the day, the sum total of prices in a capitalist economy must equate with the sum total of values generated in that economy. This is because value, as a magnitude signifying socially necessary abstract labour, only reveals itself in exchange – in exchange value or the proportions in which commodities exchange. Some goods can indeed sell at a price above their notional value but the necessary corollary of this is that other goods must sell at a price below their notional value. That means it is literally impossible that goods in general or in the aggregate can sell at a price above their value. Of course, it is quite true that the relative share of the social product that the workers receive in the form of their wages can vary upwards or downwards. For instance, according to the Economic Policy Institute, between 1979 and 2009 U.S. productivity increased by 80 percent, while the hourly wage of the median American worker went up by only 10.1 percent. ("The Sad But True Story of Wages in America", Lawrence Mishel and Heidi Shierholz, Economic Policy Institute, Issue Brief no.297, March 14, 2011). In other words most of the gains in productivity went to the super rich – the top 1%. While the real wages of workers grew by very little they nevertheless grew- thus disproving the suggestion that living standards have declined because capitalists can arbitrarily or permanently raise the prices that workers have to pay for goods above what workers are themselves paid in the form of wages. The mistake that Michel makes is to assume that the capitalists have increased their wealth in the form of profits simply by putting up prices. But profit is not made at the point of sale. Rather, it is made at the point of production and is only realised at the point of sale. In other words he is misinterpreting the growing share of social product going to the capitalists as evidence for saying the labour theory of value is no longer relevant when what it is really signifying is an increase in the rate of exploitation which is precisely what the theory seeks to demonstrate. The increased debt that workers are saddled with these days is simply a reflection of the increased share of the economic surplus appropriated by the financial capitalists and banking sector at the expense of the traditional industrial capitalists. It is not a magic money tree that allows the system to bridge the gap between falling costs of production and the ever rising price of commodities brought about by the capitalists suddenly deciding to become terribly greedy in the last two or three decades or so.
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:,If everybody paid at the cash register a price that was wage normalized, than would that not be a wageless society in that everyone effectively has the same buying power regardliess of their wage?No. Obviously. Socialism does not mean "everybody gets paid the same". Socialism is a society in which "payment " ( i.e. economic exchange, market transactions, buying and sellinng , money , barter etc etc) ceases to exist. Period. This has been said to you many times. Why do you continue to ask questions that presuppose something else?
Marcos wrote:In regard to price, there are many commodities that their prices have been decreased like in the case of electronics, a few months ago the price for a 4k television was over 5,000.00. and right now some 4k tv cost around $500.00,Yes, this is why I think Michel's whole argument is highly dubious. He talks of prices steadily rising , boosted by the "creative power" of the capitalists (meaning, marketing or branding) to revalue commodities upwards, while the costs of production have been steadily declining. That just doesnt make any sense. The figures dont add up. Since the wages of workers are a signifcant component of these costs of production that would suggest workers' earnings are dropping (which is not true – they have actually slightly increased in recent decades). But if the purchasing power of workers is diminishing how are those commodities going to be sold if businesses insist on steadily raising their prices? The reality is more complex. Some prices have been rising in relative terms – particularly for status goods – but other prices have been falling in these terms due to falling unit production costs and the competitive need for busineses to attract more customers by undercutting each other pricewise. The rise in prices of status or Veblen goods is a reflection of a secular trend in contemporary capitalism towards increasing inequality in the distribution of wealth and income, Veblen goods (which is really what Michel is talking about) are different from ordinary commodities in that increased prices (which the rich can afford anyway) is precisely what induces them to buy more of these goods, Its a way of differentiating them from the riff raff – us workers – who cannot afford such things. Marx's labour theory has not been marginalised as Michel claims. It is the circumstances that have changed but the theory allows us to understand what is going on behind these changes. The rate of profit – not the the same thing as the mass of profit which can increase with increased output despite a fall in the rate of profit – has been declining in the long run but at the same time the share of social wealth appropriated by the capitalists has been increasing. Most of the value of productivity gains over the last few decades has gone to the top 1 per cent. There is a lot of money swilling around in their hands but they find it increasingly difficult (relatively speaking) to productively reinvest it. Which is why some big corporations are sitting on big piles of the stuff and why you find an increasing tendency for the super rich to splash out on the unproductive consumption of status goods like posh houses and fancy yachts
Vin wrote:Came across this left forum – http://hollaforums.com/section/activism. Dicussions about Labour time vouchers and 'value'. Thought some members might be interested.Vin, I tried joining it but repeatedly found the sign-in facility temporarily disabled. Did you have any luck joining it?
MBellemare wrote:An ideologue, is one who, with tooth and nail, defends his or her own ideology by professing all other forms of thought as totally false, misunderstood and lacking in comprehension. Marx is still valuable, I never said he wasn't. Much of what I say is grounded in Marx. I simply think that what Marx saw as an exception in 1867, is now paramount in post-industrial, post-modern society. His law of value, and the fundamental basis of his whole theoretical apparatus as being founded on quantifiable labor-time is now marginal. It is has been pushed to the capitalist periphery such as India and China, while American Capitalism, functions increasingly on a post-industrial, post-modern basis, i.e., arbitrary/artificial constructions of value, price and wage. This is why Bernie Sanders states, without fully knowing why, capitalism is rigged, the whole system is rigged where the same people lose all the time or most of the time, while the same select few always win. It is rigged because even if workers get higher wages, capitalists can recoup their loses by arbitrarily raising prices a few percentage points above any wage increase. And presto! the workers lose again, even while, superficially winning a pay raise. As a result, capitalists appease workers by giving them pay raises (they are happy) and appease their capitalists stock holders by increasing profits, via a slight price increase that off-sets any pay raise, slightly increasing profits via small increments. Of course, this sort of system cannot continue indefinately, hence, the ever-increasing debt-load workers have to carry. But hey! capitalism is still intact! To quote Guy Debord " society has gone from being, to having, to appearing".Two good examples are the automobile industry and the North American Housing Industry: Today, no-one can truly afford a new car, in North America, but everyone can LEASE a new car, making it look as if one owns what one does not actually own. Moreover, one can LEASE a luxury car, a Mercedes, a BMW, a JAGUAR etc., via reasonable inflated monthly payments, making it look as if one is a massive success, despite the fact that, in reality, one, at best, only owns the steering wheel, or the key-chain. I ask how did this happen, when production costs for automobiles, have been steadily decreasing for roughly a century. And according to Marx, price should be decreasing as well, accordingly. The only plausible answer is that price have not been decreasing but increasing. But the opposite APPEARS to be the case because of all sorts of creative financings and leasing going on (A different type of mortgage). So yes! more people are driving and seemingly "buying" cars (The American Dream is Still IN TACT) , but they, in reality, own less and less of the cars they seemingly "buy" and drive because, in truth, the majority of North Americans citizens, do not in fact "buy" brand-new-automobiles anymore, they RENT/LEASE them. The majority of North Americans cannot afford new Cars, because prices are outlandish and out of whack, out of the realm of their real salaries, but they drive new cars because of creative financings. The truth is that behind it all, the majority of these new cars, with "SOLD" written on them, still belong to the car-companies and their dealerships. So leasing a new car, looks like real ownership, feels like real ownership, looks like real ownership to others, eventhough in reality it is not! In a world of arbitrarily-constructed values, prices and wages, debt-management is key. its all about managing debt, i.e., different types of mortgages, and one's ability to unleash capital, i.e., borrow. The same logic applies to the North American Housing Market. No one actually owns a house anymore, because, housing prices are out of whack and outlandish, despite building costs for new homes steadily decreasing over the last 50 years. And according to Marx, prices should as well have decreased in the housing market in the last 50 years, but they have not. In truth, WE PAY MORE FOR LESS. And this applies across many spheres of production. But via creative financing, more people than ever can seemingly borrow, thus more people then ever can seemingly "buy" a house, a MCMANSION in fact. However, how much of that MCMANSION do most people actually own, maybe, if thing are slightly good for a few years, the FRONT DOOR. A house mortgage is a fancy term for a rent-to-own scheme. Thus, North Americans rent from the BANKS the houses they seemingly appear to OWN and hope to eventually own outright on fine day, but they do not in truth currently own. (The American Dream is DEBT-RIDDEN). Moreover, add property taxes onto this and we, in fact, rent the land from the city and the house from the banks. Why is this? because values, prices and wages are no longer founded in production, i.e., real expenditures of quantifiable labor-power within the production sphere, but upon ideological nonsense, unfounded capitalists desires and network-power. What I am describing as post-industrial, post-modern capitalism, is far-more dangerous, far-more crazy, than Marx ever concieved. At least, Marx had sound economic laws to corral capitalists and explain values and prices. For Marx, everyone was subject to such economic laws, which limited behavior and instilled a sense of fairness across the sum of social reality. In constrast, Post-Industrial, Post-Modern capitalism is in effect lawless, extreme and fundamentally unfair. And even worst, for those who lack power and network-support. Its scary because when values, prices and wages are arbitrarily-determined, the working population, can theoretically lose everytime and indefinately, the game called post-industrial, post-modern capitalism. In fact, its not even a game, as games have set rules, which every player, regardless of social standing, must follow. Post-industrial, post-modern capitalism, is theoretically a free-for-all, where "whatever one can get away with in the market-place" is valid and legitimate, once normalized. And things can get very chaotic, alienated and violent, because it is a lawless free-for-all. The truth is that I wish Marx was completely right, because, what he described in DAS CAPITAL was an ordered economic universe, understandable, rational and scientifically sound. The Capitalism we live in now is opaque, confusing, odd, seemingly irrational and unscientific, without order and sound judgements. And the only logical principle I have been able to extract from this nonsensical capitalism is the logical principle: "To maximize profit by any means necessary, at the lowest financial cost, as soon as possible". From this logical principle, stems all the nonsense the post-industrial, post-modern capitalism generates. In post-industrial, post-modern capitalism, there are even super-profits to be extracted from all sorts of human suffering and disasters!This is all very impressionistic, Michel , but can you give any hard emprical evidence to back up what you are saying? For example , you talk about automobiles and say "production costs for automobiles, have been steadily decreasing for roughly a century. And according to Marx, price should be decreasing as well, accordingly". You say on the contary that the prices have been increasing and are now "outlandish". But according to the evidence I presented earlier the prices of new automobiles ARE decreasing in relative terms (allowing for inflation) along with a number of other categories of goods, due to increasing producitivty. True, there are some goods where the prices have gone up relatively speaking for various reasons – like branded goods . The direct costs of producing these goods may have fallen due the production being relocated to low wage economies in the Third World but, I suspect, you neglect take into account the increased costs of marketing these goods in an increasingly competitive global market Then you talk about the North American Housing Market. "No one actually owns a house anymore, because, housing prices are out of whack and outlandish". I am not too familiar with the US figures but what is the differnece between now and, say, fifty years or 100 years ago? You make it sound like there was some golden age of working class housing in the past when everyone owned their own home and things have just deteriorated since then. In continental Europe for example there has long been a tradition of renting accommodation and the greater emphasis on purchasing a home is a relatively new development Finally you go on about that these super profits that the capitalists procure today in our so called post-industrial postmodern world due to the outrageous price mark ups and price gouging they engage in today though you dont quite explain what stopped them from engaging in mark ups on the same scale in the past. It seems to me your basic mistake is to assume that profits are made at the point of sale rather than at the point of production (the Marxian explanation) and again you dont explain where all this additonal purchasing power is supposed to come from to afford these outlandish price increases. If the answer is workers getting more into debt then all this really boils down is a redistribution of surplus value from the industrial capitalists to the financial capitalists. It doesnt in itself neceesarily mean an increase the total amount of surplus value generated in the economy As I said before the long term evidence seem to point to the rate of profit gradually declining, not rising . See the link I posted earlier http://weeklyworker.co.uk/worker/1126/rate-of-profit-continues-to-fall/.. How would you respond to this point?
J P Morgan wrote:Can you recommend an article, or provide a link, that gives the Marxian explanation of the bank rate. I'd be obliged.Came across this http://www.worldsocialism.org/spgb/socialist-standard/1960s/1967/no-751-march-1967/money-nothing
J P Morgan wrote:Can you recommend an article, or provide a link, that gives the Marxian explanation of the bank rate. I'd be obliged.Try the search facility at the top right hand corner. It comes up with some stuff but I am not sure if that is what you are looking for. Good luck
MBellemare wrote:Yes, Steve San Francisco, you are banging your head against a wall, a certain wall of ideologues, trapped in the past. Semantics and the ignoring of concrete facts as somehow illigitimate, is the last resort of an outdated argument backed-up against the wall, a dying argument. So don't fret too much about it, this is how new paradigms come to the foreground. To be positive and optimistic, one can only hope on this forum, that some, who are truly interested in furthering knowledge, will examine the evidence objectively. The fact is that Marx's analysis cannot fully explain the post-industrial condition. He is helpful in pointing in the right direction and offers good insights, but cannot explain a litany of post-modern, socio-economic phenomena, which are out of reach of Das Capital. So let me quote, the American, philosopher of science, Thomas Kuhn, who can incapsulate how these issues with Marx and his ideologues will be resolved:Michel I hope this is not an endorsement on your part, as an anarchist, of Steve San Francisco's ludicrous statement:Capitalist call that a store and it fits the definition of "an immense accumulation of commodities". Socialist call it a store and it fits the definition of "an immense accumulation of commodities". As an anarchist, I take it you would agree that the kind of society we are all looking toward – socialsm – would indeed entail the complete disappearance of all commodity production – of buying and seling – however much we might disagree on how to get there On the question of examining the evidence objectively I am very keen to do precisely that. Ive cited some evidence already that seems to call into question your central thesis that Marx.'s Labour Theory of Value has been effectively marginalied by modern or, should I say, post modern developments. I am not convinced by your argument but I am open to persuasion. I think the argument you have presented thus far is too one sided and fails to see the wood for the trees, In relative tems, though some prices have risen sharply, for reasons such as branding (although I think you overlook the costs of marketing which have also to be factored into the equation), others have fallen as you would expect with rising industrial productivity and declining unit costs (adjusted for inflation) Could you perhaps address some of the concerns that I raised in post 129?
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:robbo203 wrote:robbo203 wrote:MBellemare wrote:I never said Marx's critique is no longer valid, I said it is marginalized, i.e., that capitalism functions according to a different, post-modern, post-industrial logic, that no longer holds scientific quantification of labor-power as first and foremost, but merely as a secondary minor consideration. What was in Marx's time an exception, i.e., the arbitrary construction of values, prices, and wages, where no labor-power is found, is now primary. That is all I've said. Marx readily admits that value and price can be dreamed-up and applied to thing. I merely state that now this sort of thing is primary to any quantifiable theory/law of value. By doing this, I can rightly explain from a post-industrial, post-modern point of view, why prices are rising as production costs drop, why there is ever-increasing financial inequality, why there is an ever-increasing debt load dropped upon the working population. Mr. San Francisco, supplied some excellent statistics, which prove my thesis, concerning arbitrary, artificial mark-ups, that continually rise, over the last 40 years.Michel Something does not quite add up in this argument you present of steadily rising prices and falling costs of production. Another forum user here, Steve San Francisco, comes to your aid by presenting the following evidence: “According to economists Jan De Loecker of Princteon University and Jan Eeckhout of the University College London, this basically describes the US economy since 1980. In a recently released paper, De Loecker and Eeckhout analyzed the balance sheets of listed companies from 1950 to 2014. (In 2014, these firms accounted for around 40% of all sales.) They found that average markups, defined as the amount above cost at which a product is sold, have shot up since 1980. The average markup was 18% in 1980, but by 2014 it was nearly 70%." However such evidence hardly clinches the argument for the obvious reason provided in the quote itself – that the firms concerned account for only 40% of all sales. We do not know what the situation is regarding firms accounting for the other 60% of all sales. It is quite conceivable that the former have been able to substantially raise their prices because of the changing pattern of supply and demand but at the expense of the latter, perhaps because relatively greater productivity in the latter sector has greatly increased the output of goods there bringing about a fall in their relative prices. In fact, according to this article I came across, there are “seven categories of goods and services that are comparatively cheaper today than they were 10 years ago. All figures are based on a BLS comparison of like products and services from August 1998 and August 2008.” These include phones, electronics, footwear, new vehicles, toys, apparel, watches” (http://www.bankrate.com/finance/personal-finance/7-falling-price-tags-1.aspx) So the picture you present is somewhat misleading – some businesses or industries may have been able make substantial mark-ups but only because other businesses of industries have not been able to do so. So what you have in fact is a shift in the overall pattern of demand from the latter to the former, relatively speaking.
Can anyone provide some data concerning the average mark up for industry as a whole not just a select number of businesses, as in the above quote, that account for only 40 per cent of total sales?
Gee, those are some pretty well funded researchers that came up with the 40% figure. I don't think any data that comprehensive and consolidated exists outside of deep capitalist HQ information vaults.
So essentially what this boils down to saying is that there is no hard emprical eviidence to back up the claim that businesses across the board can just arbitrarily mark up their prices in the face of (allegedly) falling production costs and this rather calls into question Michel's whole thesis that Marx's theory has been "marginalised" by the supposed ability of modern day businesses, using their "creative power" to enhance the value of commodities, in general, way above their abstract labour content. Some commodities may well sell above their value in the Marxian sense but the logical corrollary of this is that others sell below their value since the total sum of values must in the end equate with the total sum of prices
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:No. That's not what Marx or I meant in every case that we use the phrase "immense accumulation of commodities". I'm refering to a region of space like a store where an immense collection of things like toasters and blenders (aka commodities) are accumulated. You could define "an immense accumulation of commodities" with geography and a map in the lexicon of discusstion that's relevant and I'm using. Capitalist call that a store and it fits the definition of "an immense accumulation of commodities". Socialist call it a store and it fits the definition of "an immense accumulation of commodities".I feel like I am banging my head against a brick wall here. You clearly dont understand what a "commodity" is if you think a non market socialist system of production is one in which there will be "an immense accumulation of commodities". Everyone, apart from you, seems to understand that socialism in the Marxian senses entails the abolition of commodity production. Your eccentric interpretation is something that is unique to you alone, dont bring Marx into the picture. He would have guffawed heartily at such an example of profound ignorance on the subject Incidentally "toasters and blenders" are emphaticaly NOT "aka" commodities. They only become commoditiies when they are produced for the express purpose of being sold. This is so basic and elementray I have no idea why you can't seem to get your head around it
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:I think Robo203 can speak for himself. But I'll wager 1 hour of yout time reading on a topid the other chooses based on Robo203's sole determination of whom he feels owes whom an hour reading. for his service as judge Robo203's can also add an hour of time and any reading comprehension quizes to the wage and he gets to choose the topic the loser has to read. Care to put your means and abilitiy where your mouth is? If you're more than just an angry idiot then put up or shut up and let robo203 decide in his sole discretion and at his sole judgement criteria who he wants to spend an hour of time reading what. That would be the socialist way if you can see past your preconceptioins to recognize it and not get all scardy cat of an hours time lost having to think and answer a few simple reading comprehension questions. You accused me of caliming I know more than Karl Marx? So socialist defer to elites and prestigious figures to settle arguments? what difference does it make if I know more than Karl Marx except for offending your religous veneration of him which I don't think he would have wanted anyway. I want you to consider the phrase "I stand on the shoulders of genious" and consider what that might mean. I read a few marx books and summaries in college long ago and it had a profound effect on me, but clearly wasn't relevant or actionable so I didn't get much value from practicing it or talking about it most of the time. I have spent a lot of time studying human behavior in capitalist markets, usually on the inside doing some horibble job to survive making presentations for the very worst of capitalist because you got to pay the rent. Speaking of which I need a roommate now and I have one of the last rent controlled wharehouse bohemian room shares in SF that I'm renting at an incredibly low price because that's the law, and I completely approve of the law and my rent control and you have me all wrong because of your preconceptioins. Political Economic is just part of what I study and it was just part of what Marx studied. I have come after marx and my genious is added to his not in competition with his genious. Please don't apply the law of competition to me and marx because that's a capitalist way of thinking.Could you please stop wandering all over the place and address the argument in a simple straightforward fashion. I find your style f argumentation distracting and frustrating, frankly
robbo203 wrote:MBellemare wrote:I never said Marx's critique is no longer valid, I said it is marginalized, i.e., that capitalism functions according to a different, post-modern, post-industrial logic, that no longer holds scientific quantification of labor-power as first and foremost, but merely as a secondary minor consideration. What was in Marx's time an exception, i.e., the arbitrary construction of values, prices, and wages, where no labor-power is found, is now primary. That is all I've said. Marx readily admits that value and price can be dreamed-up and applied to thing. I merely state that now this sort of thing is primary to any quantifiable theory/law of value. By doing this, I can rightly explain from a post-industrial, post-modern point of view, why prices are rising as production costs drop, why there is ever-increasing financial inequality, why there is an ever-increasing debt load dropped upon the working population. Mr. San Francisco, supplied some excellent statistics, which prove my thesis, concerning arbitrary, artificial mark-ups, that continually rise, over the last 40 years.Michel Something does not quite add up in this argument you present of steadily rising prices and falling costs of production. Another forum user here, Steve San Francisco, comes to your aid by presenting the following evidence: “According to economists Jan De Loecker of Princteon University and Jan Eeckhout of the University College London, this basically describes the US economy since 1980. In a recently released paper, De Loecker and Eeckhout analyzed the balance sheets of listed companies from 1950 to 2014. (In 2014, these firms accounted for around 40% of all sales.) They found that average markups, defined as the amount above cost at which a product is sold, have shot up since 1980. The average markup was 18% in 1980, but by 2014 it was nearly 70%." However such evidence hardly clinches the argument for the obvious reason provided in the quote itself – that the firms concerned account for only 40% of all sales. We do not know what the situation is regarding firms accounting for the other 60% of all sales. It is quite conceivable that the former have been able to substantially raise their prices because of the changing pattern of supply and demand but at the expense of the latter, perhaps because relatively greater productivity in the latter sector has greatly increased the output of goods there bringing about a fall in their relative prices. In fact, according to this article I came across, there are “seven categories of goods and services that are comparatively cheaper today than they were 10 years ago. All figures are based on a BLS comparison of like products and services from August 1998 and August 2008.” These include phones, electronics, footwear, new vehicles, toys, apparel, watches” (http://www.bankrate.com/finance/personal-finance/7-falling-price-tags-1.aspx) So the picture you present is somewhat misleading – some businesses or industries may have been able make substantial mark-ups but only because other businesses of industries have not been able to do so. So what you have in fact is a shift in the overall pattern of demand from the latter to the former, relatively speaking.
Can anyone provide some data concerning the average mark up for industry as a whole not just a select number of businesses, as in the above quote, that account for only 40 per cent of total sales?
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:robbo203 wrote:Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:. Capitalism in the form that you and marx understood has already ended.Really? The wealth of those societies in which the capitalist mode of production prevails, presents itself as “an immense accumulation of commodities,”1 its unit being a single commodity. Our investigation must therefore begin with the analysis of a commodity.(Capital vol 1 ch 1) Has this ended?
When all you have is a single limited theory of socialism, then any “ immense accumulation of commodities,” looks like capitalism to be stamped out. I think the hypothetical general store is an "immense accumulation of commodities". So the theoretical socialist general store is capitalsm becuase inside of it is an immense (indead unlimited) accumulation of commodities, by your own logic.
What on earth are you talking about? I can make no sense of this response whatsoever. How is it the case that "by my own logic", socialism too will exhibit an "immense accumulation of commodities"? You apprently do not understand what a commodity is. It is not an object or good providing use value per se. Rather , it is good that is specifically produced for sale on a market. What characterises capitalism is that most goods are produced for same. i.e. there is generalised commodity production. In socialism there are no commodities whatsoever. There are goods providing use value, certainly, but these goods are not bought and sold. They are not commodities.That is because socialism is not a market exchange economy. Market exchange implies private or sectional ownersjip of the mean of wealth production but in socialism those means are owned in common, by everyone. If you own something you dont need to exchange something else for it in order to gain the right to access to the thing in question, That is why in socialism there will be no commodities and, therefore, "immense accumulation of commodities"
Steve-SanFrancisco-UserExperienceResearchSpecialist wrote:. Capitalism in the form that you and marx understood has already ended.Really? The wealth of those societies in which the capitalist mode of production prevails, presents itself as “an immense accumulation of commodities,”1 its unit being a single commodity. Our investigation must therefore begin with the analysis of a commodity.(Capital vol 1 ch 1) Has this ended?
