babble home
rabble.ca - news for the rest of us
today's active topics

Topic Closed  Topic Closed


Post New Topic  
Topic Closed  Topic Closed
FAQ | Forum Home
  next oldest topic   next newest topic
» babble   » right brain babble   » humanities & science   » The Labour Theory of Value and exploitation

Email this thread to someone!    
Author Topic: The Labour Theory of Value and exploitation
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 11 April 2005 04:02 PM      Profile for Stephen Gordon        Edit/Delete Post
Recently, Brad Delong posted a very nice summary of why economists don’t pay any attention to the Labour Theory of Value – and hence Marxist economics - these days. The LTV goes back to at least Adam Smith; Ricardo also made use of it in his version of the theory of comparative advantage. But although the propositions about the benefits of markets and the gains from trade could be adapted to the Marginalist Revolution Marxist economics could not. AFAICT, Marxists are the only surviving proponents of the LTV, and this explains why they’re largely ignored by economists. The LTV simply doesn’t make any sense.

[Yes, I'm bored. So much so that I even read up on the Transformation Problem.]


From: . | Registered: Oct 2003  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 11 April 2005 05:14 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:
Recently, Brad Delong posted a very nice summary of why economists don’t pay any attention to the Labour Theory of Value – and hence Marxist economics - these days. The LTV goes back to at least Adam Smith; Ricardo also made use of it in his version of the theory of comparative advantage. But although the propositions about the benefits of markets and the gains from trade could be adapted to the Marginalist Revolution Marxist economics could not. AFAICT, Marxists are the only surviving proponents of the LTV, and this explains why they’re largely ignored by economists. The LTV simply doesn’t make any sense.

[Yes, I'm bored. So much so that I even read up on the Transformation Problem.]


There can be two general results from a theory: 1) the person reading the abstract be formulate a prediction from it, and 2) the theory's description may lead the reader to investigate the actual rates in the industry, and why they may differ from one sample to another.

Generally, without going to a higher complexion of desription (less specifics), when one adds machinery or replaces old machines with new, the rate of production increases per labourer/machine operator. It is now possible to hire less people to produce the same amount perunit time or perhaps a greater amount. This means that few labourers may be employed to do an equal amount in production or more (rarely the less). From this reduction in employment comes the increase of pressure in the competive labour market i.e. there are more competitors for jobs than there are jobs. While bidding for jobs does not usually accure as a precondition for a job in a labour position (as far as we may know per se), we may infer for that fact that if there were wage bidding to offer to work for a lower wage, the lower wage may win the labour position. This gives a downward trend for wages, a simplification of labour tasks (and therefore of the mind) and an animical social condition between labourers (proletariat).

In addition, the over production of people to replace or to fill new labour demand in industry has contribution to this downward wage trend inclusive.

It is a point of view: from the bourgeois point of view, it has negative value because it alerts all to the fact of the appalling indifference of competitve markets, and, from the proletariats view, they have new awareness for their unhappy consciousness. I think that is why the LTV is rather unpopular to publicize.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 11 April 2005 05:34 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
You did read the extensive comments and objections to his analysis, didn't you, OC?
From: There, there. | Registered: Jun 2001  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 11 April 2005 05:44 PM      Profile for Stephen Gordon        Edit/Delete Post
Oh yes, of course. Though I didn't see anything there that amounted to much more than second- and third-order quibbling.

You may recall that I've made the same point here, using the example of a retired worker who is living off her savings. But since I didn't have the cool graphics, it didn't have the same punch.


From: . | Registered: Oct 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 11 April 2005 05:52 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by LeftRight:

In addition, the over production of people to replace or to fill new labour demand in industry has contribution to this downward wage trend inclusive.

Not that this has anything to do with the LTV, but it should be noted that current real wages are something like 10 times those that Marx saw.


From: . | Registered: Oct 2003  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 11 April 2005 06:18 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
I think the querulous quibbles, as you quaintly qualify them, were quite fundamental, but that's a matter of opinion, I guess.
From: There, there. | Registered: Jun 2001  |  IP: Logged
AppleSeed
rabble-rouser
Babbler # 8513

posted 11 April 2005 06:43 PM      Profile for AppleSeed     Send New Private Message      Edit/Delete Post
Quickly querluous quotidian quetzalcoatl quantum quacks quiescently quotate.
From: In Dreams | Registered: Mar 2005  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 11 April 2005 06:46 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
Quetzalcoatl and quantum were gratuitous.
From: There, there. | Registered: Jun 2001  |  IP: Logged
AppleSeed
rabble-rouser
Babbler # 8513

posted 11 April 2005 06:48 PM      Profile for AppleSeed     Send New Private Message      Edit/Delete Post
Thanks. I think.
From: In Dreams | Registered: Mar 2005  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 11 April 2005 06:58 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
Thorougly?
From: There, there. | Registered: Jun 2001  |  IP: Logged
AppleSeed
rabble-rouser
Babbler # 8513

posted 11 April 2005 07:01 PM      Profile for AppleSeed     Send New Private Message      Edit/Delete Post
Questionably.
From: In Dreams | Registered: Mar 2005  |  IP: Logged
AppleSeed
rabble-rouser
Babbler # 8513

posted 11 April 2005 07:10 PM      Profile for AppleSeed     Send New Private Message      Edit/Delete Post
You quiff.
From: In Dreams | Registered: Mar 2005  |  IP: Logged
Surferosad
rabble-rouser
Babbler # 4791

posted 11 April 2005 07:15 PM      Profile for Surferosad   Author's Homepage     Send New Private Message      Edit/Delete Post
This quite quantifiably qualifies as quackery!

[ 12 April 2005: Message edited by: Surferosad ]


From: Montreal | Registered: Dec 2003  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 11 April 2005 07:24 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
Quelle querelle, I quip.
From: There, there. | Registered: Jun 2001  |  IP: Logged
Surferosad
rabble-rouser
Babbler # 4791

posted 11 April 2005 07:28 PM      Profile for Surferosad   Author's Homepage     Send New Private Message      Edit/Delete Post
Quit quibbling!
From: Montreal | Registered: Dec 2003  |  IP: Logged
DrConway
rabble-rouser
Babbler # 490

posted 11 April 2005 08:09 PM      Profile for DrConway     Send New Private Message      Edit/Delete Post
MODHAT=1

Let's try to approach this topic seriously, shall we?

MODHAT=0
END


From: You shall not side with the great against the powerless. | Registered: May 2001  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 12 April 2005 04:01 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Paragraph three of the reply says
quote:
Now suppose that ten of these families starve themselves for a decade--living on little more than half-rations--to raise the cash to buy farm machinery, irrigation systems, fruit trees, et

He's loosely described depression era North America during the last years of laissez-faire capitalism. A dollar a day was the average wage, and farmers couldn't afford to upgrade equipment. Migrant farmers did go hungry as tens of thousands of emaciated men rode the rails in search of work. Banks wouldn't lend farmers money because it was less risk to foreclose on farms. Banks grew fat, and people lived greyish lives within moribund economies. Capitalism then was duller than Marxist-communism. At least the Bolsheviks had vodka during our own prohibition years while in North America, illegal booze made Canadian oligarchs their first millions.

[ 12 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 12 April 2005 10:52 AM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
What a suprise! An orthodox Economist that disagrees with Marx. Imagine that.

Labour Theory of Value

[ 12 April 2005: Message edited by: N.Beltov ]


From: Vancouver Island | Registered: May 2003  |  IP: Logged
thwap
rabble-rouser
Babbler # 5062

posted 12 April 2005 01:42 PM      Profile for thwap        Edit/Delete Post
I can't subscribe to the Labour Theory of Value because I believe that everything is inherently worthless.
From: Hamilton | Registered: Feb 2004  |  IP: Logged
Mr. Magoo
guilty-pleasure
Babbler # 3469

posted 12 April 2005 02:09 PM      Profile for Mr. Magoo   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
What a suprise! An orthodox Economist that disagrees with Marx. Imagine that.

Now this is a true ad hominem argument.

Many posters on the internet seemt to think any kind of insult or jab is an ad hominem argument, but strictly speaking it takes this form, namely the assumption that some characteristic of a person is the sole reason they hold a belief. An example:

Person A: I think we need to improve spending on our schools
Person B: You're a teacher, so you would say that, wouldn't you...

The assumption here is that there could be no other good reason to want to see increased educational spending than a teacher's self interest.

Why am I posting this? Because I believe that O.C. has probably forgotten more about economics than most of his critics here will ever know, but because he doesn't come at it from the radical left, this pops up frequently. I think it would be far more appropriate if his points were taken on their own merits and debated on their merits.


From: ø¤°`°¤ø,¸_¸,ø¤°`°¤ø,¸_¸,ø¤°°¤ø,¸_¸,ø¤°°¤ø, | Registered: Dec 2002  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 12 April 2005 02:34 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Mr. Magoo: O.C. has probably forgotten more about economics than most of his critics here will ever know...I think it would be far more appropriate if his points were taken on their own merits and debated on their merits.

What points? All O.C. has done is to refer approvingly to a blog by an orthodox Berkeley Economist that denounces the LTV. Oh yes. And OC has also "pooh-poohed" any contrary views. Very compelling. (Not!)

I added a link to a sympathetic Canadian academician on Marx and the LTV, which seems entirely appropriate, given that O.C. isn't making any independent remarks on the LTV as it is developed by Marx and other Marxists. And babblers should form their own conclusions and not fall for an appeal to authority , which, in case you haven't noticed Magoo, is as weak an argument as any.


From: Vancouver Island | Registered: May 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 12 April 2005 03:01 PM      Profile for Stephen Gordon        Edit/Delete Post
Actually, I don't have any self-interest to defend here. I have tenure, and if I wanted to adopt Marxism at this point in my career, no-one could do anything to make life difficult for me. Nor could anyone really accuse me of having played it safe and sucked up to conventional wisdom in order to get where I am - the number of economists who use the techniques I do is probably somewhat less that the number of Marxists. I know what it's like to be a voice in the wilderness, sure that everyone else is wrong, and frustrated that no-one will listen to reason. And that was before I started posting on babble.

Delong's stick-figure model and my recurring example of a retired worker's pension fund (does a pensioner's income consist entirely of surplus value?) summarise why mainstream economists think that the LTV and the concept of exploitation are simply not useful ways of looking at these things. What I had hoped is that those who do think that these are useful concepts would explain why that view is mistaken.

I did read that link, but it really doesn't have anything to say to me on this point. It's a history of the LTV, written for non-economists. It makes no attempt to explain why it's better than what what we're using now.


From: . | Registered: Oct 2003  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 12 April 2005 03:25 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
In fairness to O.C., not all present-day Marxists (e.g. Erik Olin Wright, theoretician of social class) subscribe to LTV. Perhaps it is time to dust off my copy of Capital and provide some answers (for myself at least).

But it is also worth adding that a lot of orthodox Economics focuses upon (the minutae of) price determination, whereas Marxism focuses on the transience of the present (socio-economic) formation. In some sense, the goals are different.

One view, that the current form of social production is "imperishable and final" contrasts radically with the view that the current form of social production is but "a passing stage" in the economic history of humanity: these contrasting points of view are going to pose different questions, much less different answers to similar questions, based on the differing philosophical and ideological views. How could it be otherwise?

Magoo: I'm not convinced that identifying an ideological trend is an ad hominem argument: if I had identified white Economists, or male Economists I would agree with your assessment.

Time to take care of my economic needs. First things first! Perhaps we can all agree on that?


From: Vancouver Island | Registered: May 2003  |  IP: Logged
thwap
rabble-rouser
Babbler # 5062

posted 12 April 2005 03:37 PM      Profile for thwap        Edit/Delete Post
Weren't Alfred Marshall's arguments about the returns to capital similarly based on faith and politics?

blah, blah, blah ...

quote:
confirming Proudhon's argument that the loaning of capital "does not involve an actual sacrifice on the part of the capitalist" and so he "does not deprive himself. . . of the capital which he lends. He lends it, on the contrary, precisely because the loan is not a deprivation to him . . ., because he neither intends nor is able to make it valuable to him personally, -- because, if he should keep it in his own hands, this capital, sterile by nature, would remain sterile."

Nice one here ...


From: Hamilton | Registered: Feb 2004  |  IP: Logged
robbie_dee
rabble-rouser
Babbler # 195

posted 12 April 2005 03:42 PM      Profile for robbie_dee     Send New Private Message      Edit/Delete Post
Since we've already brought up a couple of logical fallacies on this thread, I thought I should point out that both Oliver and De Long are making straw man arguments against Marxism.

quote:
It makes no attempt to explain why it's better than what what we're using now.

If your question is whether neoclassical economics should just drop what it is doing now and embrace a simplified 19th Century version of the Labour Theory of Value, I at least would be happy to concede that as a dumb idea.

But, as one of the posters on De Long's blog pointed out, all Marx was doing was taking what was an accepted theory of the time - creditable to Ricardo and Smith - and applying it to try and explain a social relationship he called exploitation and he observed in the "actually-existing" capitalism (to borrow a phrase ) of his era.

The question should not be whether or not the "Labor Theory of Value" was right. The questions should be whether there really is ever such a social relationship as exploitation, whether such exploitation exists at all today, whether it is prevalent in "actually-existing" capitalism today and whether there is anything inherent in how our "actually-existing" capitalist economy works that causes this exploitation. It doesn't matter whether you can construct a thought experiment where the capitalist appears morally sympathetic compared to his wage worker. What matters is what actually happens in our economy and why. That's what I understand neo-Marxists try to explain, using their own set of analytical tools, just as neo-classicists try to explain things using their new tools.

[ 12 April 2005: Message edited by: robbie_dee ]


From: Iron City | Registered: Apr 2001  |  IP: Logged
Mr. Magoo
guilty-pleasure
Babbler # 3469

posted 12 April 2005 03:50 PM      Profile for Mr. Magoo   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
the loaning of capital "does not involve an actual sacrifice on the part of the capitalist" and so he "does not deprive himself. . . of the capital which he lends. He lends it, on the contrary, precisely because the loan is not a deprivation to him

Could anyone who believes this please lend me as much savings as you can possibly spare without defaulting on your rent? As you believe, it should be no deprivation to you, and when my get-rich-quick plan works you're almost certain to maybe get it back.


From: ø¤°`°¤ø,¸_¸,ø¤°`°¤ø,¸_¸,ø¤°°¤ø,¸_¸,ø¤°°¤ø, | Registered: Dec 2002  |  IP: Logged
Vigilante
rabble-rouser
Babbler # 8104

posted 12 April 2005 03:57 PM      Profile for Vigilante        Edit/Delete Post
I actually think people shouldn't pay attention to economics. It's all based on language and socially constructed lies.

The whole thing is a religion that for the sake of life on earth and in general should go the way of the dinos.


From: Toronto | Registered: Feb 2005  |  IP: Logged
Mr. Magoo
guilty-pleasure
Babbler # 3469

posted 12 April 2005 04:13 PM      Profile for Mr. Magoo   Author's Homepage     Send New Private Message      Edit/Delete Post
10 Criticisms of "Orthodox" Economics, from a Far-Left Perspective

10. It values some production, such as growing food or building a bridge, but totally ignores others like writing poetry or making a dandelion chain

9. All that math is clearly an attempt to exclude hippies, dropouts and English Majors

8. It makes continual reference to "Profit" (Ptui!) and I get dehydrated from spitting on the ground so much

7. You need a university degree to be an Economist. Ideally it should be taught by Starhawk at a weekend "empowerment" workshop, right after we learn to make disguises

6. It benefits only those who have something to buy, sell, rent, lease, lend, borrow or trade

5. It's not a "Hard Science" like the other Sciences I dismiss when I disagree with them

4. It persistently refers to "Capitalists" rather than the preferred term "KKKapitalists"

3. It's not 100% accurate like, say, the weatherman or my doctor, so I must shun it absolutely

2. Everything everywhere should be free for everyone, and as soon as we start valuing people over profits, it will be

1. Lalalalalala! I can't hear you!

[ 12 April 2005: Message edited by: Mr. Magoo ]


From: ø¤°`°¤ø,¸_¸,ø¤°`°¤ø,¸_¸,ø¤°°¤ø,¸_¸,ø¤°°¤ø, | Registered: Dec 2002  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 12 April 2005 04:25 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
*yawn* That was not funny, Magoo, it was tedious and trollishly strawman filled. You knew that, though, didn't you?
From: There, there. | Registered: Jun 2001  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 12 April 2005 04:25 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
Look! It's babble's own Dave Letterman, with his Top Ten. All we need is a quisling from Thunder Bay.
From: Vancouver Island | Registered: May 2003  |  IP: Logged
Mr. Magoo
guilty-pleasure
Babbler # 3469

posted 12 April 2005 04:30 PM      Profile for Mr. Magoo   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
it was tedious and trollishly strawman filled.

LOL! The very next poster suggests I'm some sort of "Quisling", and you're suggesting I'm heavy handed with the strawmen??

I wasn't aware we were at war, nor that I was collaborating with the "enemy". Honestly, with rhetoric like that floating about, I think I'm actually going easy.


From: ø¤°`°¤ø,¸_¸,ø¤°`°¤ø,¸_¸,ø¤°°¤ø,¸_¸,ø¤°°¤ø, | Registered: Dec 2002  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 12 April 2005 04:33 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
No, he suggested you were Dave Letterman. He was saying we needed a quisling to collect them all.
From: There, there. | Registered: Jun 2001  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 12 April 2005 04:37 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
Actually my "quisling" reference was in regard to Paul whats-his-name on Letterman. Gawd. Even when Dave takes a slap at things Canadian, his sidekick just sucks it up. I'd rather watch Leno or nothing at all.

Letterman does the countdown (10,9,8,...)in reverse order...which is what made me think of him.


From: Vancouver Island | Registered: May 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 12 April 2005 04:50 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by robbie_dee:
Since we've already brought up a couple of logical fallacies on this thread, I thought I should point out that both Oliver and De Long are making straw man arguments against Marxism.

If your question is whether neoclassical economics should just drop what it is doing now and embrace a simplified 19th Century version of the Labour Theory of Value, I at least would be happy to concede that as a dumb idea.

But, as one of the posters on De Long's blog pointed out, all Marx was doing was taking what was an accepted theory of the time - creditable to Ricardo and Smith - and applying it to try and explain a social relationship he called exploitation and he observed in the "actually-existing" capitalism (to borrow a phrase ) of his era.



I'd agree with that - I think I even said that in the opening post. I don't really much blame Marx for using the tools that he had at hand at the time. My point is that we shouldn't be paying any attention to it now.

quote:

The question should not be whether or not the "Labor Theory of Value" was right. The questions should be whether there really is ever such a social relationship as exploitation, whether such exploitation exists at all today, whether it is prevalent in "actually-existing" capitalism today and whether there is anything inherent in how our "actually-existing" capitalist economy works that causes this exploitation. It doesn't matter whether you can construct a thought experiment where the capitalist appears morally sympathetic compared to his wage worker.


But the LTV is what gives the term 'exploitation' any meaning in this context. If you abandon the LTV, you have to come up with some other theory of value in which exploitation is a meaningful concept.

quote:

What matters is what actually happens in our economy and why. That's what I understand neo-Marxists try to explain, using their own set of analytical tools, just as neo-classicists try to explain things using their new tools.


I certainly agree with the first part, but AFAICT, Marxists are having a heck of a time with the 'Transformation Problem', namely, how to map a theory expressed in terms of values to observeables like prices.


From: . | Registered: Oct 2003  |  IP: Logged
The Other Todd
rabble-rouser
Babbler # 7964

posted 12 April 2005 07:32 PM      Profile for The Other Todd     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Mr. Magoo:


Now this is a true ad hominem argument.


Not really. It's kind of like that "bear shitting in the woods" comment. He's coming at the matter from such a fundamentally different angle as Marx and Marxists that he's not even on the same planet, let alone the ball park.

Brad's a semi-regular over at LBO-Talk; we examined his little set-piece there. Go here:

http://mailman.lbo-talk.org/pipermail/lbo-talk/

and do a search for this phrase:

[lbo-talk] Delong puts the smackdown on ol' Whiskers

Do a reverse sort by date to find the start of the thread. Read especially the comments by Doug Henwood, Michael Perelmen, and "andie nachgeborenen".


From: Ottawa | Registered: Jan 2005  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 12 April 2005 08:50 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Vigilante:
I actually think people shouldn't pay attention to economics. It's all based on language and socially constructed lies.

The whole thing is a religion that for the sake of life on earth and in general should go the way of the dinos.


'Be stupid about economics as long you hate the bourgeois'? That's not going sell very well either.....LTV is a price difference description between owning class 'labour' and labour, nothing more. The word 'exploitation' is one those multi-meaning words, ambiguous that begs the question of ill intent, belief or indifference as to why wages are what they are. It is really irrelevant to the value of Marxs level of validity because there is no way to exclude random chance from the wage decision. Now we have minimum wage (the wage may be this low and no lower). Was there a minimum wage in Marxs time? I don't remember, but it is irrelevant because the theory is simply a means to bring up the question and the anwser as to why property has greater power than wage labour: because it is the law.

"In the social production of their life, men enter into definite relations that are indispensable and independent of their will, relations of production which correspond to a definite stage of development of their material productive forces. The sum total of these relations of production constitutes the economic structure of society, the real foundation, on which rises a *legal* and political superstructure and to which correspond definite forms of social consciousness. "

http://www.marxists.org/archive/marx/works/1859/critique-pol-economy/guide.htm


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 12 April 2005 11:07 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
I think it is good to remember that our wages are in part dependent on the strength of the union movement. A wage is created by inter-industry competition for labour. Since union wages are high, the rest of the market must pay a wage in relation to the average union wage. The "crappy" 8-10 dollar an hour job is only crappy in relation to the 15-20 dollar an hour union job and the management class only makes 50 to 60 grand a year because the wages of production labourers are high. Therefore, if unions were to disappear, it is not likely that wages will stay at their current social level and it is certain that the fat pensions would disappear. After all, it is very competitive out there. (you know the song and dance)

As for the LTV and descriptive economics in general, I think it is obvious that economic theories are only theories. Actual economic is a very complex interrelation of important factors, including supply and demand, subjectivity, social interaction, and most fundamentally the wage relation. Afterall, the only way to refute Marx's theory of value is to refute labour as an integral part of the production process, which is impossible.

[ 13 April 2005: Message edited by: blueskyboris ]


From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
dandolfa
rabble-rouser
Babbler # 8654

posted 13 April 2005 12:08 AM      Profile for dandolfa   Author's Homepage     Send New Private Message      Edit/Delete Post
What an odd collection of posts...good job OC!

Why don't we start with a "development fact." One of the striking patterns of economic development in the so-called "industrialized world" is that real wages have risen by on average 2% per annum over the last 100 years or so. (This is enough to double wages every 35 years, or so).

I am wondering whether this basic fact (references available on request) is consistent with the LTV? (I don't know the theory well enough to know myself).


From: Burnaby | Registered: Mar 2005  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 13 April 2005 06:36 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
What about cost of living by comparison ?. What about purchasing power parity and economic well being of workers ?. The US and Canada, one-two, own the lowest rates of unionized labour among developed nations, and coincidentally, we rank the same in terms of percentage low wage employment of total workforce. As well, our two nations own some of the developed world's worst rates of child poverty with the Yanks taking first for highest infant mortality among richest nations.

"During the 1990's, Canada's aggregate economic performance has been the worst since the Great Depression, and very nearly the worst among all industrial countries." - Industry Canada, Micro, vol.7, no. 2, summer 2000
===
I think what's been shown is that the two central economic theories dominating recent history are lacking in some way. If some of us find criticizing classic economic theories easy pickings, then we should know that we're not the first to do so. We're are on our own because the experts can't help uz any more than they're able to guide politicians who are sometimes forced to take into account the real implications of economic policies. We're on our own.

Like Marx before him, Karl Polanyi realized that economists liked to fit their theories to frame established, natural theories like Darwinian evolution. I think Polanyi's critique of laissez-faire capitalism was that it was no more natural than the invisible hand as the neutral guiding force behind free markets. As Polanyi has said, laissez-faire was planned; planning was not. The theory was man-made and far removed from being natural.

[ 13 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 13 April 2005 07:15 AM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
This is a interesting subject.

The basis seeks to find some allegorical context to the wage modification idealizations?

I find problems trying to go back to this state of things without understanding that in today's world, negotiated processes seek to maintain balance on cost of living, that rises alongside of demands for the wage increase.

Inflation rates if stabilized and cost of living also stabilized( is this the avweage 2% wage increase factor?), there would be no need for such adjustments, but this is always far from the truth of things, as we see wages actually go down in relation too the average inflationary propsects over previous and coming years?

This would have to be qualified of course.

Any privatization to current Canadian properties, ex. hydro and such, is counter productive to maintaining cost of living affordability. So why "privatize," what is already own and managed, for the Canadian People?

Fair competitive market value?

If you have a niche in the marketplace why would you sell off this benefit in regards to Canadian ownership? Sell off this protential benefit of the Canadian people?

To continue attacking negotiated processes and attacking the cost analysis of the piece of the pie alloted to unionised people by companies just seems counter productive? Without people and money in their pockets you have no base in which to recognize who is keeping bsinesses healthy and alive?


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 13 April 2005 07:37 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
I agree, ForumObserver. Why sell off the family jewels and silverware to political friends of the party ?. What is the real market value of vast tracts of timber bearing, oil and natural gas producing provinces ?. Will this aid us in paying for health care, education and other necessities for a civilised society ?. Why don't we selloff the military or corporate welfare programs to private interests ?.

Missing from Marx's and Delong's LTV accounting are whole values for social capital, and according to scientists the world over now, environmental capital. Capitalism works for capitalists, but not for the rest of us who have to live with the end results.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
thwap
rabble-rouser
Babbler # 5062

posted 13 April 2005 12:16 PM      Profile for thwap        Edit/Delete Post
Me quoting Proudhon:
--------------------------------------------------------------------------------
'the loaning of capital "does not involve an actual sacrifice on the part of the capitalist" and so he "does not deprive himself. . . of the capital which he lends. He lends it, on the contrary, precisely because the loan is not a deprivation to him'"
--------------------------------------------------------------------------------

Magoo's response:

quote:

Could anyone who believes this please lend me as much savings as you can possibly spare without defaulting on your rent? As you believe, it should be no deprivation to you, and when my get-rich-quick plan works you're almost certain to maybe get it back.

There's actually a lot more going on in Proudhon's statement than you're able to make out. He's dealing with the reality that (excepting those cases on the margins of the economy like DeLong's starving farm families, or any other struggling hopestobee capitalist), most of the investor class is well-off.

They might not all be able to lend money without deprivation (or as the web link put it: lose money and not even notice it), but a significant portion of them can, and do.

Proudhon was addresing the fallacy that capitalists deserve more of the product of capital because they deprive themselves in the past and the present, precisely so that they'll enjoy the larger claim later.

Workers are supposed to consciously renounce their claims to a greater product later, supposedly because they're short-sighted and greedy: They want it all up front.

Supposedly, a burgeoning capitalist neither feeds nor shelters his or herself while "waiting" for their expected pay-offs. Supposedly nothing from the loans invested, their other job, or immediate proceeds from the new enterprise are diverted to pay for food and shelter, like the greedy workers are doing with their paycheques.

Again though, these examples are at the margins. A lot of wealth comes from nature. A lot of it came from historical inequalities. A great deal of capital is now retained earnings, plowed back into the firm. It has nothing to do with the "sacrifices" of the investor class.

And who sets the price of capital? Supposedly it is a function of supply and demand. But however problematic this reality is, money is very much a political creature. How we determine the supply, who gets it, etc., etc., these are all important questions, glossed over by mainstream economics. (So far as my reading of it goes.)



From: Hamilton | Registered: Feb 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 13 April 2005 12:26 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Workers are supposed to consciously renounce their claims to a greater product later, supposedly because they're short-sighted and greedy: They want it all up front.

Where the hell is this crap coming from?

Just as we might look at the very basis designed of this theory, how would it have been applicable to our current state of affairs?

Left/right did speak to technological advancement in terms of reduction of manpower and reducing benefits and wage paid, is the ultimate motivation of any business enterprise.

It's a method in attacking how expenses are distributed in that proverbial pie. Usually, and in our case it was 9% union and with additon workforce 8% in managerial and others.

But here's the thing companies don't like is that on this level executive counterparts representing the workers have the same responsibilties in managing and organization as any company is managed. So why should company exec's want to deal with counnterparts that represent a sector of that pie, when they could have wide sweeping statements in the way the company wants to run it's own organization?

This is a captialist dream developed by a liberal capitalist government that would secure the rights for such sweeping perspectives over those who would pay to support society and who have rights?

I linked the pope in a earlier conversation because the closest I could see to such a statement about the philosophcal derivation of any math, was hidden in his comment on behalf of Lech Walesa and the struggles for sweeping changes under the regimes that would seek to rule.

During his latest visit to the land of his fathers, Pope John Paul II had this to say on this point:

"Why do the working people in Poland - and everywhere else for that matter - have the right to such a dialogue? It is because the working man is not a mere tool of production, but he is the subject which throughout the process of production takes precedence over the capital. By the fact of his labor, the man becomes the true master of his workshop, of the process of labor, of the fruits of his toil and of their distribution. He is also ready for sacrifices if he feels that he is a real partner and has a say in the just division of what has been produced by common effort".

You have to understand history will shape the people who expound the views, and in this context, how would such reforms serve to bring new perspective to the relatiosnhip of the worker and company?

The struggle is for maintaining balance in a inflationary world. If you loose sight of the individual in all it's abilties, you will have smeared out the remaining distinctivesness of personality( a capitalistic system seeks to do this), that is offered to the whole.

Companies wil raise their prices to offset expenses they incurr, to continue to be productive? Should smart intelligent workers continue to loose, and loose the support for the money they spend in that supports foundations of the cities/towns that industries live in?

Privatization seeks to wipe out union managed people and links to social orders that was driven by concientous people who wanted to protect right human rights.

Will, seek to wipe out Tommy Douglas's view of a Health care system that would now serve two classes of citizens, based on what one could afford and what the other could not. Both should be served equally as one.

If a theory is founded on faulty premises then when it is subjected to verification, it's data viewed as a model, is also faulty? It will not show any economic sense?

Some other constant had to be established before the model was ever introduced. Without a inflationary correlation, this model could not served to show worker thinking and maintenance of the basis of it's particpation in the market place. Workers seek to support the very foundation that business enterprises would work to bring theirs products for ware to the vast number of individuals for distribution.

Smart captitalist people forget this balance that supports the foundations of it privatization programs? That the LIberal Governements would seek to wipe out, with privatization.

[ 13 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 12:35 PM      Profile for Stephen Gordon        Edit/Delete Post
Many comments in the interval; I’ll try to get back to some of them. But for now, I want to say this:

Comments to the effect that the Delong model is grossly simplified are entirely beside the point. If a theory can’t provide sensible answers when things are simple, there’s little reason to expect it to do any better when they get more complex.

Here’s what happens. We start with a case A with no exploitation (in the LTV sense), and we end with case B in which (1) everyone is materially better off than before, and (2) exploitation exists.

Someone who thought that introducing exploitation to a society where none existed before was a bad thing would conclude that situation B is worse than situation A. But I don’t recall anyone actually saying that that they really think that this is the case.

If your reply is ‘Okay, B is better than A, but...’, then the LTV becomes irrelevant – what really matters is the criterion you’re using to decide under what circumstances exploitation is acceptable or not.

More concretely, I think that most people would want to make the distinction between the profits that are generated by Paris Hilton’s wealth and are used to finance her lifestyle, and the profits that are generated by a pension fund and are used to finance pensioners’ incomes. The problem is that the LTV does not, so it’s simply not a useful tool for looking at these issues.


From: . | Registered: Oct 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 12:43 PM      Profile for Stephen Gordon        Edit/Delete Post
Me quoting thwap quoting thwap quoting Proudhon :

quote:
Originally posted by thwap:
Me quoting Proudhon:
--------------------------------------------------------------------------------
'the loaning of capital "does not involve an actual sacrifice on the part of the capitalist" and so he "does not deprive himself. . . of the capital which he lends. He lends it, on the contrary, precisely because the loan is not a deprivation to him'"
--------------------------------------------------------------------------------


Quite sensible, but only because it explicitly rejects the LTV. If you take the LTV seriously, then the sacrifice of $10k by someone earning $1m/year is exactly the same as that of someone earning $30k/yr - they're both sacrificing the same 'value'.

It was the Marginalists who made the point that from the point of view of a household, the loss associated with a sacrifice of $10k would be a declining function of income.

[ 13 April 2005: Message edited by: Oliver Cromwell ]


From: . | Registered: Oct 2003  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 13 April 2005 12:53 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
What are the componets of inflation?


If a theory is founded on faulty premises then when it is subjected to verification, it's data viewed as a model, is also faulty? It will not show any economic sense?

Some other "constant" had to be established before the model was ever introduced. Without a inflationary correlation, this model could not served to show worker thinking and maintenance of the basis of it's particpation in the market place.

Workers seek to support the very foundation that business enterprises would work to bring their products of ware, to the vast number of individuals, for distribution? It's base.

[ 13 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
thwap
rabble-rouser
Babbler # 5062

posted 13 April 2005 12:57 PM      Profile for thwap        Edit/Delete Post
Just a reminder: I don't subscribe to the LTV.

And a factoid: I'm no expert, but Marx didn't think much of Proudhon, and Proudhon wasn't a subscriber to Marxism (think he was dead when Marx wrote, not sure).

Me quoting Proudhon is about Marshall, et.als' scientific claims about the returns to capital.


From: Hamilton | Registered: Feb 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 01:07 PM      Profile for Stephen Gordon        Edit/Delete Post
That makes sense.
From: . | Registered: Oct 2003  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 02:08 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
Delong's example is bad propaganda. The workers are still exploited regardless if their material wealth is increased. They are still propertyless freemen working for the man. They have no control over their wealth and if the union movement were to disappear their labour would be devalued accordingly.

Besides, the example starts in "property ladeeda land" where the slave societies and serf societies apparently do not exist. We are educated to believe, contrary to history, that wealth creation has simply been an individual choice, and not the documented coercion through brutality that it is. Also, it is annoying to see a blantant disconnect perpetrated between Marx's theory of human essence, exploitation, and the power of the factory system to recreate the original essence.

[ 13 April 2005: Message edited by: blueskyboris ]


From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 02:19 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by blueskyboris:
The workers are still exploited regardless if their material wealth is increased. They are still propertyless freemen working for the man.

Sure. But the question is: Are they worse off?


From: . | Registered: Oct 2003  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 02:32 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Sure. But the question is: Are they worse off?
As I have beeen alluding to over and over again, union wages drive up the overall value of labour up, so it is hard to say if the workers would be, in a human sense, better off in a completely liberalized economy.

For example, the Shenzhen factory workers are relativiely better off compared to fellow workers (but not much), but they still live impoverished lives in relation to what they produce, because they can not afford the products they produce.

If I work for you, and you make millions and live like a king off our labour, while my meager income increases by 50%, who is exploiting who? I have no property, so I am in no position to negotiate, just as most labourers are not in a position to negotiate. You are paid what you are paid. You produce for those with capital. A worker's labour-power is exploited because property is power economically (though there is a certain degree of power in knowledge based work, though not that much; the average engineer is paid the market salary for an average engineer)


From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 02:38 PM      Profile for Stephen Gordon        Edit/Delete Post
So, is that a yes or a no?
From: . | Registered: Oct 2003  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 02:40 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
You are reducing "better off" to mere material gain. Marx deals with the entire package.
From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Dex
rabble-rouser
Babbler # 6764

posted 13 April 2005 03:02 PM      Profile for Dex     Send New Private Message      Edit/Delete Post
quote:
Originally posted by blueskyboris:
As I have beeen alluding to over and over again, union wages drive up the overall value of labour up, so it is hard to say if the workers would be, in a human sense, better off in a completely liberalized economy.
But unions actually do the act opposite. Is there something superior about the work done by a union worker? No. Unions drive up the COST of labor. On top of that, the lack of flexibility (e.g., in a non-union shop, the pipe fitter doesn't risk a reprimand if he spends 30 seconds sweeping the floor after himself), restrictions on hiring, firing, and promotions, to say nothing of the additional cost of the union bureaucracy itself, all contribute to the average union worker performing LESS valuable labor. One can certainly make the argument that this is a worthy tradeoff for society to make because of improved working conditions and wages, but unions definitely don't categorically INCREASE the value of any given worker.

From: ON then AB then IN now KS. Oh, how I long for a more lefterly location. | Registered: Aug 2004  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 03:37 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
But unions actually do the act opposite.
What part of my argument do you not understand? Businesses compete with the union average wage, which drives up their wages higher than they would be.

quote:
Is there something superior about the work done by a union worker?
You are missing the point.

quote:
Unions drive up the COST of labor.
Indeed, which is my argument. Union wages drive up the overall market wage.

quote:
On top of that, the lack of flexibility (e.g., in a non-union shop, the pipe fitter doesn't risk a reprimand if he spends 30 seconds sweeping the floor after himself), restrictions on hiring, firing, and promotions, to say nothing of the additional cost of the union bureaucracy itself, all contribute to the average union worker performing LESS valuable labor.
I am glad you worship efficiency and a devaluation of labour.

quote:
One can certainly make the argument that this is a worthy tradeoff for society to make because of improved working conditions and wages, but unions definitely don't categorically INCREASE the value of any given worker.
Who said they did?

From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 04:12 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by blueskyboris:
You are reducing "better off" to mere material gain.

Not at all. I can imagine that it's possible that the gains associated by an increase in one's material well-being could be outweighed by the psychic pain of knowing that your employer is making a profit. But in the absence of empirical evidence to the contrary, I don't think that this effect is strong enough to worry much about.

[ 13 April 2005: Message edited by: Oliver Cromwell ]


From: . | Registered: Oct 2003  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 05:11 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Not at all. I can imagine that it's possible that the gains associated by an increase in one's material well-being could be outweighed by the psychic pain of knowing that your employer is making a profit. But in the absence of empirical evidence to the contrary, I don't think that this effect is strong enough to worry much about.
I am glad to see you have conceded the argument by playing the "prove it" card early.

From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 13 April 2005 05:32 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Of course, all these property rights for the rich and corporations would be worthless to the idle rich without coercive labour laws to prop them up. Stacks and stacks of money sitting in a bank vault do not a building or bridge make.
From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 13 April 2005 06:01 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Exactly, BlueSky. And now let's be off with ourselves to regroup and collect our thoughts.
From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 06:03 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by blueskyboris:
I am glad to see you have conceded the argument by playing the "prove it" card early.

So was that in fact your point? That they're better off materially, but because they're employer is making a profit, they're worse off over all? That the new situation is worse than the original?

I just want to be clear here; as I said earlier, no-one else who has commented on this has actually come out and said this yet.

[ 13 April 2005: Message edited by: Oliver Cromwell ]


From: . | Registered: Oct 2003  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 13 April 2005 06:23 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Oliver, why does the value added non-labour end of it require a larger share of the transaction and the overall income pie ?. Why do we have to fight inflation on their behalf, the minority few whose assets and wealth suffer from erosion much moreso than our own paltry savings ?.

And just in case no one else realized the value of their non-labour input, we had to fight two world wars and a cold war to prove it for them.

[ 13 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 07:48 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by Fidel:
Oliver, why does the value added non-labour end of it require a larger share of the transaction and the overall income pie ?.

Larger than what? Capital's share of income is less than the labour share. And it's not larger than it was, either. From a post in another thread about corporate profits:

quote:

- Corporate profits averages around 10% of GDP. It goes down a couple of points during during recession, and a couple of points above that during upturns. There is no discernable trend in this ratio.

- In Canada, the share of output that goes to workers is roughly 5 times the share that goes to the owners of capital. This ratio fluctuates with the cycle, jumping up significantly (up to 8 or 12 times the capital share) when profits go down during recessions.

- There is no detectable long-run trend in the labour and capital shares of output. (This is also true of the US.)



From: . | Registered: Oct 2003  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 13 April 2005 08:57 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Fidel:
I agree, ForumObserver. Why sell off the family jewels and silverware to political friends of the party ?. What is the real market value of vast tracts of timber bearing, oil and natural gas producing provinces ?. Will this aid us in paying for health care, education and other necessities for a civilised society ?. Why don't we selloff the military or corporate welfare programs to private interests ?.

Missing from Marx's and Delong's LTV accounting are whole values for social capital, and according to scientists the world over now, environmental capital. Capitalism works for capitalists, but not for the rest of us who have to live with the end results.


That's because the LTV is not the 'whole thing'. I am not sure what you mean in the word 'whole values'....I guess it means the same thing I said.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 13 April 2005 09:27 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by blueskyboris:
Who said they did?

Unions do not increase the value of non-union labour nor the price value for non-union labour. What increased the power of the worker to receive a better wage was class struggle as expressed in unionism and class politic in general, i.e. the minimum wage plus other conditions which could be over turned in future. Best keep that in mind.

There are banks in the business of loaning money, that is their business, not some kind of citizen to citizen loan, i.e. 10K means nothing to them but the credit rating of the borrower does.

The LTV....I definately must read it again, because I am sure it is a review of a theory and not Marxs subscription to a theory, i.e. just a backgrounder.

Karl Marx
Economic and Philosophical Manuscripts of 1844

Wages of Labour

"Wages are determined through the antagonistic struggle between capitalist and worker. Victory goes necessarily to the capitalist. The capitalist can live longer without the worker than can the worker without the capitalist. Combination among the capitalists is customary and effective; workers’ combination is prohibited and painful in its consequences for them. Besides, the landowner and the capitalist can make use of industrial advantages to augment their revenues; the worker has neither rent nor interest on capital to supplement his industrial income. Hence the intensity of the competition among the workers. Thus only for the workers is the separation of capital, landed property, and labour an inevitable, essential and detrimental separation. Capital and landed property need not remain fixed in this abstraction, as must the labour of the workers."

The key point in the passage is no longer current, and yet persists to be applicable today.

"Combination among the capitalists is customary and effective; workers’ combination is prohibited and painful in its consequences for them. "


http://www.marxists.org/archive/marx/works/1844/manuscripts/wages.htm


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 13 April 2005 09:38 PM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
So was that in fact your point? That they're better off materially, but because they're employer is making a profit, they're worse off over all? That the new situation is worse than the original?
I will say it right off: other things being equal, at a given moment of time, wealth is relative. We wouldn't, say, talk about high infant mortality in the "Third World" if there weren't parts of the world that had lower infant mortality. Like that.

So if some people are increasing in wealth much faster than others, then I would indeed say that the new situation is worse than the original. Or, at the very least, this is a situation that greatly needs to be corrected, and perhaps the absolute material gain is insufficient to support the loss of equality.


From: There, there. | Registered: Jun 2001  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 13 April 2005 10:08 PM      Profile for Stephen Gordon        Edit/Delete Post
You've made similar comments before, and although there certainly is something to the idea that people have preferences for status (and not just absolute levels), it seems to me as though most people would be willing to exchange an increase in inequality for a higher average. I guess the 64$ question then is how to measure inequality, and at what rate we'd want to do the tradeoff.

I'm going to do some reading (and talk to a colleague who works in this area) and maybe start another thread on it.


From: . | Registered: Oct 2003  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 13 April 2005 10:57 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Left/Right

Unions do not increase the value of non-union labour nor the price value for non-union labour.

There is a conservative effort, by captalistic idealizations to keep unions from esatblish business practices.

The Walmart scenario is a fine case in point.

Being involved in witnessing first contracts struggles it is amazing what a community(the customer base not realized) can do when it bans together to change practices counterproductive to maintaining meaningful dialogue in wages negotiatons. Without this wage parady there is no hope other then, maintaining wage practices that are comparative to local unions in order to encourage no sign ups?

There is no way to manage corrupt practices and disfavor with personal bias in a system without the union togetherness.

What increased the power of the worker to receive a better wage was class struggle as expressed in unionism and class politic in general, i.e. the minimum wage plus other conditions which could be over turned in future.

Yes I agree with this. Poverty and living for our children in a world that demands payments for survival, it is short of hope that such progress to sustainability can ever be managed?

This is to point out the future turnover.


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 13 April 2005 11:03 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
Oliver
quote:
So was that in fact your point? That they're better off materially, but because they're employer is making a profit, they're worse off over all? That the new situation is worse than the original?

I just want to be clear here; as I said earlier, no-one else who has commented on this has actually come out and said this yet.


I am asserting that exploitation has nothing to do with wealth. A person is exploited if they create excesss value for another person in a coercive system. It is the "for the other with unequal benefits" that makes exploitation exploitation. For example, fulltime working females who do most of the housework are exploited by the male, because the male knows that society expects women to to the housework. The working women does the housework for her husband (the other) even though she knows she will have less free time (unequal benefits)


LeftRight

quote:
Unions do not increase the value of non-union labour nor the price value for non-union labour.
Thanks for that non-informative, non-counter argument.

quote:
What increased the power of the worker to receive a better wage was class struggle as expressed in unionism and class politic in general, i.e. the minimum wage plus other conditions which could be over turned in future. Best keep that in mind.
Yes, and it is also true, intracapitalism speaking, that labour is valued by the demand for labour, competition between labourers, and the supply of labour. Therefore, since labour unions increase their share of profits by banding together as a subclass, their "higher wage block" effects the price of wages market-wide. No longer are capitalists paying wages to unorganized, divideable and conquerable individuals, but to individuals competiting for the jobs offered by the unionfied blocks of labour, which, because they are unionized, have higher wages.

[ 13 April 2005: Message edited by: blueskyboris ]


From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 13 April 2005 11:49 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by blueskyboris:
Oliver
Yes, and it is also true, intracapitalism speaking, that labour is valued by the demand for labour (when the demand exceeds supply), competition between labourers (when it is not a competition for the lower wage), and the supply of labour (Did I contradict that?). Therefore, since labour unions increase their share of profits (what is profit?) by banding together as a subclass, their "higher wage block" effects the price of wages market-wide (how?). No longer are capitalists paying wages to unorganized, divideable and conquerable individuals, but to individuals competiting for the jobs offered by the unionfied blocks of labour, which, because they are unionized, have higher wages (than what?).

[ 13 April 2005: Message edited by: blueskyboris ]


Thanks for that non-informative, non-counter argument. That would be fine if all workers were unionized, but they are not..... I don't think I need to repeat that again; non-union people know. Unions make few guarantees. It would be helpful to know what the ratio/proportion of union to non-union workers is.....of course, this is whole topic is not the whole ball of wax.

Karl Marx
Economic and Philosophical Manuscripts of 1844

Antithesis of Capital and Labour.
Landed Property and Capital

"... forms the interest on his capital. The worker is the subjective manifestation of the fact that capital is man wholly lost to himself, just as capital is the objective manifestation of the fact that labour is man lost to himself. But the worker has the misfortune to be a living capital, and therefore an indigent capital, one which loses its interest, and hence its livelihood, every moment it is not working. The value of the worker as capital rises according to demand and supply, and physically too his existence, his life, was and is looked upon as a supply of a commodity like any other. The worker produces capital, capital produces him — hence he produces himself, and man as worker, as a commodity, is the product of this entire cycle. To the man who is nothing more than a worker — and to him as a worker — his human qualities only exist insofar as they exist for capital alien to him. Because man and capital are alien, foreign to each other, however, and thus stand in an indifferent, external and accidental relationship to each other, it is inevitable that this foreignness should also appear as something real. As soon, therefore, as it occurs to capital (whether from necessity or caprice) no longer to be for the worker, he himself is no longer for himself: he has no work, hence no wages, and since he has no existence as a human being but only as a worker, he can go and bury himself, starve to death, etc. The worker exists as a worker only when he exists for himself as capital; and he exists as capital only when some capital exists for him. The existence of capital is his existence, his life; as it determines the tenor of his life in a manner indifferent to him.

Political economy, therefore, does not recognise the unemployed worker, the workingman, insofar as he happens to be outside this labour relationship. The rascal, swindler, beggar, the unemployed, the starving, wretched and criminal workingman — these are figures who do not exist for political economy but only for other eyes, those of the doctor, the judge, the grave-digger, and bum-bailiff, etc.; such figures are spectres outside its domain. For it, therefore, the worker's needs are but the one need — to maintain him whilst he is working and insofar as may be necessary to prevent the race of labourers from [dying] out. The wages of labour have thus exactly the same significance as the maintenance and servicing of any other productive instrument, or as the consumption of capital in general, required for its reproduction with interest, like the oil which is applied to wheels to keep them turning. Wages, therefore, belong to capital's and the capitalist's necessary costs, and must not exceed the bounds of this necessity. It was therefore quite logical for the English factory owners, before the Amendment Bill of 1834 to deduct from the wages of the worker the public charity which he was receiving out of the Poor Rate and to consider this to be an integral part of wages. [24]"

http://www.marxists.org/archive/marx/works/1844/manuscripts/second.htm


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 14 April 2005 12:05 AM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
Yes, and it is also true, intracapitalism speaking, that labour is valued by the demand for labour (when the demand exceeds supply (no, both; the demand for labour does not stop when the demand for labour is greater than the supply)), competition between labourers (when it is not a competition for the lower wage (no, it is even more so the case when the wage rate is low)) , and the supply of labour (Did I contradict that? (no, you rejected my argument that higher union wages pull up wages market wide). Therefore, since labour unions increase their share of profits (what is profit? (as Marx argues)) by banding together as a subclass, their "higher wage block" effects the price of wages market-wide (how? (by the competition for labour market wide, of course)). No longer are capitalists paying wages to unorganized, divideable and conquerable individuals, but to individuals competiting for the jobs offered by the unionfied blocks of labour, which, because they are unionized, have higher wages (than what?(than non-unionized labour, of course)).
From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
Mandos
rabble-rouser
Babbler # 888

posted 14 April 2005 01:16 AM      Profile for Mandos   Author's Homepage     Send New Private Message      Edit/Delete Post
Let us compare, say, a prostitute in Cambodia to a prostitute in Canada. The prostitute in Canada probably has it, in absolute material terms, better than the prostitute in Cambodia. But in other terms, the Canadian and Cambodian prostitute are often subject to same kinds of risks of violence, disease, etc. It is their relative power, as partially represented by their relative wealth, that makes them subject to the violence of those more powerful than they.

Of course, the people hurting them would likely be their johns, but what is it that compels them to be in that position in the first place? In a society of greater wealth equality, I propose that there would be less opportunity for the pockets of exploitation that occur regardless of the absolute increases in average wealth. Consequently, not just any raising of the average wealth is satisfactory, but rather ones that also decrease the alienation and exploitation that exist in society.


From: There, there. | Registered: Jun 2001  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 14 April 2005 06:30 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:

Larger than what? Capital's share of income is less than the labour share. And it's not larger than it was, either. From a post in another thread about corporate profits:


- Corporate profits averages around 10% of GDP. -
...
There is no detectable long-run trend in the labour and capital shares of output. (This is also true of the US.)


That's interesting. We'd almost think corporations were doing workers in Canada a favour by being here. Here, in this land of wide open spaces and natural resources up the wazoo.

Corporate Tax Revenue as % of GDP
1960s 3.0 percent of GDP
1970s 2.4 ""
1980s 2.0 ""
1990s 1.8


Corporate taxes as a percent of Ttl Fed Rev
1960s 19.0 percent
1970s 16.0 ""
1980s 12.4 ""
1990s 10.8 ""

Personal Income Taxes as a percentage of all Fed Income
1960s 32.2 percent
1970s 41.3 ""
1980s 43.0 ""
1990s 46.9 ""

Average annual increases in personal income
1960s 8.3 percent
1970s 13.4 ""
1980s 9.7 ""
1990s 3.2 ""

"Free trade has been good for Canada." - Brian Mulroney

Average annual labour-income increases
1940s 6.9 percent
1950s 8.4 ""
1960s 9.1 ""
1970s 13.0 ""
1980s 8.9 ""
1990s 3.3 ""

Avg annual unemployment rates in Canada
1950s 4.2 percent
1960s 5.0 ""
1970s 6.7 ""
1980s 9.3 ""
1990s 9.5 ""

Corporate Profits in Canada
1967-77 $152.1 billion
1978-88 $458.4 billion
1989-99 $694.6 billion

(data from Statistics Canada and NAFTA at Seven:Its impact on workers in all three nations, EPI, Washington DC, April 2001)

Of course, we needed to reduce the availability of generous welfare and EI benefits to the working class bc we just weren't efficient enough in the 1970s. We had no incentive to work hard (or take low paid work). Gutting our social welfare system was supposed to make us all more efficient and competitive. Increasing worker desperation, I think Linda McQuaig refers to it.

Meanwhile, unemployment rates have gone up, labour participation rates are down by almost 2 percent on average since FTA, and we've gone deeper in the hole while fighting inflation on behalf of capital. The private sector's avg, contribution to new jobs dropped from 153, 200 jobs in the 1980s to 88, 300 new jobs in the 1990s. And the avg number of new full time jobs created has dropped off while part-time job growth has skyrocketed. Yes, Canadian's are doing their share in biting the bullet for corporate profits and "competitiveness." Just what kind of competitiveness are they meaning because I'll bet we still don't come close to socialist Finland's, Sweden, Denmark or Singapore's CGI ranking next year either.

What happened to flexible labour markets?. We've got the flexible end of it down pat, but where's the party ?.

[ 14 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 14 April 2005 11:23 AM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Therefore, since labour unions increase their share of profits

Just a point of clarification here.

Unions, are "non-profit" organizations.

[ 14 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 14 April 2005 11:36 AM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Fidel,


quote:
Corporate Tax Revenue as % of GDP
1960s 3.0 percent of GDP
1970s 2.4 ""
1980s 2.0 ""
1990s 1.8


Corporate taxes as a percent of Ttl Fed Rev
1960s 19.0 percent
1970s 16.0 ""
1980s 12.4 ""
1990s 10.8 ""

Personal Income Taxes as a percentage of all Fed Income
1960s 32.2 percent
1970s 41.3 ""
1980s 43.0 ""
1990s 46.9 ""

Average annual increases in personal income
1960s 8.3 percent
1970s 13.4 ""
1980s 9.7 ""
1990s 3.2 ""

"Free trade has been good for Canada." - Brian Mulroney

Average annual labour-income increases
1940s 6.9 percent
1950s 8.4 ""
1960s 9.1 ""
1970s 13.0 ""
1980s 8.9 ""
1990s 3.3 ""

Avg annual unemployment rates in Canada
1950s 4.2 percent
1960s 5.0 ""
1970s 6.7 ""
1980s 9.3 ""
1990s 9.5 ""

Corporate Profits in Canada
1967-77 $152.1 billion
1978-88 $458.4 billion
1989-99 $694.6 billion

(data from Statistics Canada and NAFTA at Seven:Its impact on workers in all three nations, EPI, Washington DC, April 2001)


That's interesting. We'd almost think corporations were doing workers in Canada a favour by being here. Here, in this land of wide open spaces and natural resources up the wazoo.


Looking at source I could not find these statistics?

Good work on your post, as this is the kind of information that is needed to qaulify the corporate world dominances on views, over worker's.

So often once you get a preview of a aspiring lad trying to gain a foothold in the corporate world, the ramblings are sickening based on the perspectve that are directed, to the up and coming.

Security Breech: Freetrade, Privatization and the Open Borders

I couldn't help seeing the banter in our house about privatization, as to who is really leading the charge there. Diverionary tactics.

In my own home town, It was stated by Emerson that if he had his way privatization should take over completely in British Columbia. He said it was good for business.

Do you have a link to these statistics?

[ 14 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 14 April 2005 06:36 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Institute for Policy Studies: FACTSHEET ON THE NAFTA RECORD 2003


NAFTA at Seven: Economic Policy Institute, Washington DC

laborresearch.org: More Free Trade is Not the Answer

[URL=www.econ.ubc.ca/riddell/canusune.pdf ]UBC Economics: Craig Riddell[/URL]

Corporations Return Act


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 14 April 2005 07:49 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Thanks Fidel,

Amazing isn't it.

Whipsawing: NAFTA has had a detrimental impact on the power of American workers to fight for better wages and working conditions. Cornell University Professor Kate Bronfenbrenner has documented threats by U.S. employers to move to Mexico and other low-wage countries in order to fight unions and restrain wages. She found that the use of such threats in union organizing drives increased from about 50 percent in the early 1990s to 62 percent in 1998 and 68 percent in 1999. [7] Most economists concede that such pressures were a factor in the meager growth of U.S. real wages in the late 1990s, despite near record low unemployment.

IN bold, what happpens is not always clear when we are confined to our hovels

Blackmail in Canada: In Canada, the business community has used NAFTA to push for cuts in social programs, arguing that it was necessary to compete with the United States, which generally offers lower levels of protection. The clearest example of their impact is the scaling back of Canada’s unemployment insurance. According to a publication of the Canadian Centre for Policy Alternatives, the percentage of unemployed that qualified for this insurance dropped from 87 percent in 1989 to only 39 percent in 2001. [8]

Again, it is amazing that what Candians owned have been sold off to build specific government coffers, to give back, what they originally took from people, who were already paying a decent price, on what they already owned as citizens of this country. Maybe Circular reasoning using the shell game? WE already owned the shells, and the pea, we just let business play the game, and confuse us.

I had not even mentioned outsourcing that goes on, to diversify the current labour force, and provide for the cheaper paying jobs for those unemployed, or who are about to be unemployed. Ths is athreat that a governement will use to pay cheaper wages?

So the lesson is never take a hit on your benefits if threatened, always on the wage, so such government tactics to lower your wages is past directly to the community.

Let the community know up front, that what happens when you cut a wage, you cut something from the community, and it is a government that you elect to do these things. This is the liberal tactic in the province of British Columbia.

Really it's making me sick, that business interests has demolished the sovereign nation they called Canada and they figure they are doing a good job.

I am looking for a Canadian identification again, that recognizes the people in this country, and one, that is not being sold down the drain by selling off the interests we have.

So you aligned the statistics from these sources?

[ 14 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 14 April 2005 08:07 PM      Profile for Stephen Gordon        Edit/Delete Post
I suppose it would have been too much effort to put NAFTA posts on one of the kazillions of active NAFTA threads.
From: . | Registered: Oct 2003  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 14 April 2005 08:13 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
It's still all about labour OC.

Exploitation of workers, and the Canadian people.

Without these stories about how tactics are used and developed, you'll never understand why people band togehte to protect themselves.

One might go to a church and a spiritual haven for comfort, and some, will find it in the protections of numbers and their resources.

Negotiate is a very important word in a democracy?

[ 14 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 14 April 2005 08:44 PM      Profile for Stephen Gordon        Edit/Delete Post
Oh well, could be worse - Fidel could have used this thread to talk about infant mortality again.
From: . | Registered: Oct 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 14 April 2005 08:46 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:
Oh well, could be worse - Fidel could have used this thread to talk about infant mortality again.

[edited to add:]

Oh. He did.


From: . | Registered: Oct 2003  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 14 April 2005 09:53 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by blueskyboris:
Yes, and it is also true, intracapitalism speaking, that labour is valued by the demand for labour (when the demand exceeds supply (no, both; the demand for labour does not stop when the demand for labour is greater than the supply)), competition between labourers (when it is not a competition for the lower wage (no, it is even more so the case when the wage rate is low)) , and the supply of labour (Did I contradict that? (no, you rejected my argument that higher union wages pull up wages market wide). Therefore, since labour unions increase their share of profits (what is profit? (as Marx argues)) by banding together as a subclass, their "higher wage block" effects the price of wages market-wide (how? (by the competition for labour market wide, of course)). No longer are capitalists paying wages to unorganized, divideable and conquerable individuals, but to individuals competiting for the jobs offered by the unionfied blocks of labour, which, because they are unionized, have higher wages (than what?(than non-unionized labour, of course)).

Assumptions: the demand for labour is insatiable, there can be more postions for labour than labourers, competition necessarily requires employers to offer more money, the union market is the same as the non-union labour market.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
maestro
rabble-rouser
Babbler # 7842

posted 14 April 2005 09:56 PM      Profile for maestro     Send New Private Message      Edit/Delete Post
Having read Brad Delong's article I would say he knows nothing at all about either economics or Marx. What he does know is how to use rhetorical device to shore up a non-existent argument.

First off, he ignores the primitive accumulation of capital. This is essential for all capitalist economists. That's because all primitive accumulation of capital was theft.

In his example, capital is accumulated by thrift and hard work. In the real world, capital was accumulated by force of arms.

In his example the thrifty farmers save money to buy "farm machinery, irrigation systems, fruit trees, et cetera from the cities." But that ignores where that machinery etc come from. They come from a pre-exisitng capitalist economy.

The thrifty farmers are in fact just taking advantage of an earlier instance of expropriation of common property.

In a society where all propety is 'common', there can be no accumulation of wealth (indeed there doesn't need to be). What Delong is trying to do here is present an example of primitive accumulation, but his example presupposes an already existing capitalist economy.

The machinery etc. that the thrifty farmers are planning on buying were made by cooperative labour, which had it's surplus value expropriated by the owners of the means of production. Delong just ignores that in his example.

The surplus value created was created by the cooperative efforts of labour, and expropriated by the owners of the means of production.

Delong tries to put a nice face on this by making his farmers thrifty and hard working. Who could argue with that. But the manufacture of the machinery that they're going to buy may not have been thrifty or hard working.

In fact, whether they're hard working or not is immaterial to the argument.

I could be a thrifty and hard working person who purchases items from a fence, and then resells them for a profit. Are the items that I sell still stolen property?. Not according to Delong, or for that matter, any capitalist apologist.

Great example in the Financial Post yesterday with Terence (capitlus ignoramus) Corcoran decrying the fact the Russian government is retrieveing their oil supply.

According to Corcoran:

quote:
The Yukos case, too, started with a claim for back taxes, which escalated to a surreal bill for US$28-billion. It led to the arrest of Mr. Khodorkovsky and fellow Yukos officials, and to Yukos's major oil-producing asset being "sold" to - that is, stolen by - state-owned Rosneft, which is run by one of Mr. Putin's old KGB cronies.

Corcoran ignores the fact Yukos was stolen from the Russian people.

And that's what Delong and other capitalist apologists do. They ignore the original theft, then go on to make their arguments.

They also ignore the fact that capital moves around freely. When they deny workers are exploited, citing examples of how our standard of living has increased, they ignore the fact the theft has just changed location.

Our standard of living is being subsidised by the people of the third world, whose resources (common property) are being stolen by force of arms, and shipped to the industrial countries for remanufacture.

The fact workers in the industrialised countries receive a greater percentage of surplus value than they used to doesn't affect the labour theory of value, nor the fact of the primitive accumulation (theft) of capital.


From: Vancouver | Registered: Jan 2005  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 14 April 2005 10:41 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by maestro:

In his example, capital is accumulated by thrift and hard work. In the real world, capital was accumulated by force of arms.

In his example the thrifty farmers save money to buy "farm machinery, irrigation systems, fruit trees, et cetera from the cities." But that ignores where that machinery etc come from. They come from a pre-exisitng capitalist economy.


Not necessarily. Another way of telling the story would have been to suppose that they simply reduced the amount of time producing consumption goods, and used the freed-up labour time to build the capital goods themselves. It doesn't change the result.

Good rant, though.


From: . | Registered: Oct 2003  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 14 April 2005 11:36 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:

Not necessarily. Another way of telling the story would have been to suppose that they simply reduced the amount of time producing consumption goods, and used the freed-up labour time to build the capital goods themselves. It doesn't change the result.

Good rant, though.


"Build up capital goods" You mean they forged the iron themselves and machined pistons and engine blocks? ha ha ha Or perhaps they used a co-operative metal work shop and rented the machining machinery. ha ha ha Good B'S' though.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 14 April 2005 11:42 PM      Profile for Stephen Gordon        Edit/Delete Post
Or they could have traded wheat for capital goods at a non-explotative rate of exchange. The point is that capital accumulation is the result of sacrificed consumption.
From: . | Registered: Oct 2003  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 15 April 2005 12:42 AM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
iT could be worse--

Trivia?

Money

Money, get away
get a good job with more pay and you're O.K.
money, it's a gas
grab that cash with both hands and make a stash
new car, caviar, four star daydream
think I'll buy me a football team

Money, get back
I'm alright, Jack, keep your hands off my stack
money, it's a hit
don't give me that do goody good bullshit
I'm in the hi-fidelity first class travelling set
and I think I need a Lear jet

Money, it's a crime
share it fairly but don't take a slice of my pie
money, so they say
is the root of all evil today
but if you ask for a rise it's no surprise that they're giving none away, away, away


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 15 April 2005 03:47 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
quote:
Originally posted by maestro:
Having read Brad Delong's article ...First off, he ignores the primitive accumulation of capital. This is essential for all capitalist economists. That's because all primitive accumulation of capital was theft.

Exactly. All of Canada's billionaire families sold illegal booze on their way to "earning" their first million except one. KC Irving was a log thief, and then he became a respectable billionaire.

quote:

In his example, capital is accumulated by thrift and hard work. In the real world, capital was accumulated by force of arms.

Predatory capitalism, good-good. Carry on.

quote:

The thrifty farmers are in fact just taking advantage of an earlier instance of expropriation of common property.

"They hang the man or woman who steals the goose from off the common.
But they let loose the greater evil who steals the common from under the goose." - 18th century English folk poem

quote:

In a society where all propety is 'common', there can be no accumulation of wealth (indeed there doesn't need to be). What Delong is trying to do here is present an example of primitive accumulation, but his example presupposes an already existing capitalist economy.

I agree. We must assume that wealth and power are to be chanelled to what is an apex of a pyramidal hierarchical society, because it's "natural." It's the thing to do. Remember, two world wars and a cold war to maintain the established order of the cosmos according to capital. Darwin would have wanted it this way, or something like that.

quote:

The machinery etc. that the thrifty farmers are planning on buying were made by cooperative labour, which had it's surplus value expropriated by the owners of the means of production. Delong just ignores that in his example.

Delong seems to be re-creating an example from the 1930's when farmers had no access to capital and therefore could not afford to upgrade farm equipment to increase productivity. If agribusinesses can access capital, why not farmers ?. Why don't elected governments compete with private enterprise if it were truly a free market?. Why dregulate when we can bail out taxpayer enterpise for as much or less than state-capitalist monoplies?. We already know that socialized medicine and hydro-electric power are less expensive than privatised American examples. Hellen, even our beer and wine stores make money for us.

And I agree about Khodorkovsky and Yukos. Putin's people renationalised the oil using perfectly legal free market mechanisms. The people now own a money-making oil field almost as bountiful as Libya's total annual oil production. The oligarchs stole oil rights and more when that drunk, Yeltsin, was giving away half of Russia's silverware.

Edited because I suck at remembering old English folk rhymes.

[ 15 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 15 April 2005 04:08 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:

[edited to add:]

Oh. He did.


If I did mention infant mortality, then I suppose I should apologize. What I should have pointed to was Canada's appalling child poverty rates, one of the worst among developed first world nations. It's but one more dysmal measure of the state of labour and economic well being of workers in this country while corporate profits are at all time highs.

I don't need a Humvee just as much as I don't need a plastic shower curtain liner which used-up thousands of gallons of fresh water in the process of creating it. Canadian's want health care, access to education, day care, affordable housing and meaningful work. We want to be as economically competitive as socialist Finland or Sweden or even socialist Singapore fcs. And btw, OC, was Lee Kwan Yew a Friedmanist or a protege of British socialist, Harold Wilson ?.

[ 15 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
maestro
rabble-rouser
Babbler # 7842

posted 15 April 2005 07:44 AM      Profile for maestro     Send New Private Message      Edit/Delete Post
From Oliver Cromwell:

quote:
Not necessarily. Another way of telling the story would have been to suppose that they simply reduced the amount of time producing consumption goods, and used the freed-up labour time to build the capital goods themselves. It doesn't change the result.

Good rant, though.


LeftRight responded to this quite well,

quote:
"Build up capital goods" You mean they forged the iron themselves and machined pistons and engine blocks? ha ha ha Or perhaps they used a co-operative metal work shop and rented the machining machinery. ha ha ha Good B'S' though.

but I’ll add a point. If the story didn’t require the supply of capital goods from the city, why did Delong put it in?

Obviously he felt it was necessary. You say it’s not, but as LeftRight pointed out, these thrifty farmers had no way to manufacture the capital goods required to increase their productivity (which is true in real life as well). And that’s why Delong put it in his story – he needed the farmers to be able to increase their productivity to make the example work.

Before they could ‘reduce the amount of time’ needed to produce consumption goods; they had to have the machinery in order to do so. They couldn’t produce those goods on their own, so the ‘city’ provided for them. Once the ‘city’ was there to provide the capital goods, they could use their ‘thriftiness’ (sacrificed consumption) to save money to purchase those goods.

In his example, the ‘city’ is ‘deus ex machina’, the miracle that makes it work.

Further from O C

quote:
Or they could have traded wheat for capital goods at a non-explotative rate of exchange. The point is that capital accumulation is the result of sacrificed consumption.

Capital accumulation is the result of the owner of the means of production expropriating the surplus value created by the division of labour. That’s really what’s happening in Delong’s example.

The factory owner takes advantage of the division of labour, taking the profit realized when he pays the workers for their individual effort, while selling their cooperative effort.

Note the thrifty farmers don’t reap any benefit from this transaction, unless they in turn can hire workers and do the same thing.

In order to make a profit; the thrifty farmer first has increase the size of holdings, and have some labour to hire.

Before capital can accumulate, people have to be thrown off the common land – which is precisely what happened in the real world of primitive accumulation.

The point about the trading wheat for machines is no different than the original example, which ignores primitive accumulation.

Also the ‘non-exploitative’ rate of exchange is immaterial. Whether the rate was exploitative or not doesn’t change the facts of the example. The more exploitative the rate, the more labour required to make the farm profitable.


From: Vancouver | Registered: Jan 2005  |  IP: Logged
Fidel
rabble-rouser
Babbler # 5594

posted 15 April 2005 08:01 AM      Profile for Fidel     Send New Private Message      Edit/Delete Post
We've just got to have faith in the sanctity of private property rights over common rights, maestro. Us working class slobs have got to learn to lower our expectations in order for their market ideas to work. The law of property within a free market says, essentially, that all of us, rich and poor, are free to starve to death in any corner of it while state-funded law enforcment makes sure we don't do it on someone elses private property.

It's amazing how much state power is actually required to prop-up a so-called free market economy. Just keep thinking like we're supposed to though, like homo economicus. You're a one dimensional, greed-driven borg with no other thoughts but to make plastic widgets and share the value of what you produce with the idle rich.

[ 15 April 2005: Message edited by: Fidel ]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 15 April 2005 12:06 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Don't mind me I had to do some refreshing here.


The labor theory of value (LTV) is a theory in economics and political economy concerning a market-oriented society: the theory equates the "value" of an exchangeable good or service (i.e., a commodity) with the amount of labor required to produce it.

The dominant view sees this as a theory of price determination in competitive markets, a substitute for the neoclassical theory of price determination. But to others, it is a tool for understanding the social relations of production, more of an historical and institutional theory than a price theory

So I'll have to go back over and get it right I guess

Left/RightIn addition, the over production of people to replace or to fill new labour demand in industry has contribution to this downward wage trend inclusive

Over production of people, decreased by modifications for sure, but how would this contribute to downward trend. More people fewer jobs? IN a unionized environment we recognize such things as loss of jobs but never a increase of people for the same job, just modificatiosn to lines of progressions.

Secondly we recognize technological advancements and increaase productivity and efficiency when trying to increase production. So you look for this in your assumption of increasing that same production.

One that you can reduce benefits and wages by eliminating jobs. So more production, fewer jobs, higher cost for initial investment, to boost production. Ultimatey a ratio of higher production with fewer people.

If you look at this further, the subjective valuation of such moves, have far reaching effects. Not only for the individual, but of the dollar value removed from the community.

Added wealth from investment to boost production. So this recognition of technological change does not benefit the community nor does it benefit the worker who loses that wage.

But this can be dissected even further in that lines of progression ultimately experience diversification of the remaining labour, which technological advancement does not see. In this case increased production assume that technological advancement will always remove the worker form the picture, but does not make allowances for the "extra" work load the production seeks to increase in the initial investment?

To further speak to this one must realize that such recognitins of the lines of progression increased production have a role to play in a redetermination of the wage that was original paid under the auspice of the cureent production standards and relevant changes to come in theinitial investment to increase that production. There is a analysis for this, but in no way does it satisfy the work that is distriubuted on assuptions that technological change will benefit the company. Workers work harder no matter what.

Just relying on human expeirence to see if such applicabilties of model make sense in contrast to opening statement. Ultimately model structures have to correlate to the real world.

I still lacking the vision OC relates to ignoring Marxist views in a economic sense. Patience.

Marx begins Capital by analyzing the commodity, the relationship of commodities with each other, and the implications of this for social relationships. From the analysis of the commodity, Marx builds a labour theory of value which he uses to explain not only exchange relationships in capitalism, but the economic and social structures of capitalism, and their development.

[ 15 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
blueskyboris
rabble-rouser
Babbler # 7764

posted 15 April 2005 02:19 PM      Profile for blueskyboris   Author's Homepage     Send New Private Message      Edit/Delete Post
forum observer
quote:
Therefore, since labour unions increase their share of profits

Just a point of clarification here.


Unions are political organizations, not non-profits.

leftright

quote:
Assumptions: the demand for labour is insatiable, there can be more postions for labour than labourers, competition necessarily requires employers to offer more money, the union market is the same as the non-union labour market.

1. No, I am not making the assumption that the demand for labour is unsatiable. I am aware of the Dark Ages.

2. Yes, I am assuming there can be more positions than labourers. The specialized and engineering fields are specific examples, and the the coming Baby Boom retirement is a general example. Boom cycles can also create a higher demand for more labour then exists.

3. Necessarily? Heavens no.

4. ?? Labour Unions do not struggle for higher wages? ??


From: Nova Scotia | Registered: Dec 2004  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 15 April 2005 04:23 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
Unions are political organizations, not non-profits

Unions are non profit, and political affiliations they have, depends on the vote that they believe suits the interest and means of protecting "their rights at a most basic level of human understanding".

It is a "entity", like any corporation? Except, the non profit cannot be considered if it makes a profit(corporations do).

For the Union there is no profit to be gained other then what is negotiated according to the recognition of what inflation dictates to us.

This serves us well under democratic principals and law in this country. Any lawyer can jump in here to validate if they wish.

Corporations are smart though, so recognizing this they can manipulate the situation to suit them and the influx of ideaology that they import intothis country from the United States.

Christian Labour Associations? They found a way to use this front to negotiate contracts,and then dictate wages, as they hire them.

You see they only needed to form the organization and form its constitutions and bylaws. Form it's executive positions, and then negotiate a contract. They bid, and then pay the inferior wages to people who are competing for jobs lost to technological change and consolidations of corporate entites.

I have participated in such creations of organizations other then unions, so I well know what it takes to form such organizations, and become a legal entity.

A lawyer could validate what I am sayng very easy, and touch up what I am saying to further clarify.

This is a very important lesson for corporate people to understand, especially if you are working for any corporation. I recognize th population and the way it will dictate how this corporation will do if the populations takes the human dignity back into the consideration. The right and freedoms cannot be dictated by these corporations.

You must understand we need business to ensure the population continues to thrive, but we do not want scrupolous people at the helm, with ulterior motives, to corral people to cities and find ways to easily manage them.

WE see where th ereationship between diamonds and water are compared, where labour intensiveness correlates to the diamonds worth.

Consider this the population of United States is over 200 million, and in Canada, 36 million. Do you realize that in California alone, there are 36 million people? There is only about 1% freshwater(help here?) on our planet and in Canada we have lots of this. If shipped to the states a cheap commodity? But seen in context of dollars, what is it worth to 36 million people in california? This is quite the contrast is it not?

Protectionism has been taught us by the UNited States, the same one who wants to open the borders(control our security), and with capitaliist intentions, Martin as one of the three amigos, is saying this is good for soverneignty?

Wrong. Stop selling off cheap commodities. Stop selling of hydro power so that we have to compete for it on the open market.

[ 15 April 2005: Message edited by: forum observer ]


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 15 April 2005 04:36 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Unions are political organizations, not non-profits

What?? Unions are economic organizations (of self-defence). And the classic (Marxist) critique of them is that they don't go far enough and, therefore, need to be supplemented by political parties that represent working people.

It is the arrogance of certain political parties, not mentioning any names, of course, that tell union activists to shut the hell up and support Party "X", which is presented as the only vehicle for the political aspirations of working people.

In Canadian working class history, unions that made their prime focus politics failed. They failed for a variety of reasons but fail they did. Think of the OBU, or the Wobblies, etc. Of course, Canadian (labour) law made sure of that. The compartmentalization of activity, the separation of politics from economics, as though these are 2 hermetically sealed domains, is a tendentious lie of our society, substantiated and justified by law. You say Economics, I say Political Economy, let's call the whole thing off!

Hee hee


From: Vancouver Island | Registered: May 2003  |  IP: Logged
forum observer
rabble-rouser
Babbler # 7605

posted 15 April 2005 04:50 PM      Profile for forum observer   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
What?? Unions are economic organizations (of self-defence). And the classic (Marxist) critique of them is that they don't go far enough and, therefore, need to be supplemented by political parties that represent working people.

I like to take right down to the "source of things." Economic might be a bad word when it is tied to political organizations? People are the base of society

Rather, the "institutions" that support humanity in its social condtions.


From: It is appropriate that plectics refers to entanglement or the lack thereof, | Registered: Dec 2004  |  IP: Logged
N.Beltov
rabble-rouser
Babbler # 4140

posted 15 April 2005 05:07 PM      Profile for N.Beltov   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
forum observer: I like to take right down to the "source of things." ....People are the base of society

If we go to "the source of things", then it would be more complete to assert that society is the basis of people . It's Aristotle, long before Marx, who asserted that we are the social animal, the zoon politikon , and it doesn't really serve much of a purpose to posit some abstract being, squatting somewhere outside of society, whose humanity is somehow "inherent" and independent of the social milieu in which they live.


From: Vancouver Island | Registered: May 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 15 April 2005 07:17 PM      Profile for Stephen Gordon        Edit/Delete Post
quote:
Originally posted by maestro:

Capital accumulation is the result of the owner of the means of production expropriating the surplus value created by the division of labour.

It might be useful to recall some identities. These are not theories; they're relationships that must always hold, regardless of how the economy is structured:

Capital is accumulated expenditures on investment goods (i.e., productive capacity), less accumulated depreciation.

Savings = income minus expenditures on consumption goods.

Investment = savings.

Clearly, expected profits have a role in the consumption/savings decision: higher profits mean a higher returns on savings. And this generally means an increase in savings (or, equivalently, investment) that will in turn accelerate the rate of capital accumulation.

Profits may explain why capital is formed. But they're not how it's formed.

Just a clarification.


From: . | Registered: Oct 2003  |  IP: Logged
Rufus Polson
rabble-rouser
Babbler # 3308

posted 15 April 2005 08:14 PM      Profile for Rufus Polson     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:
Comments to the effect that the Delong model is grossly simplified are entirely beside the point. If a theory can’t provide sensible answers when things are simple, there’s little reason to expect it to do any better when they get more complex.

The funny thing is that DeLong really has nothing to say about whether the answers are sensible. His initial analysis claims that the moral judgments he portrays the LTV as making are bad morality. Someone else then points out that Marx didn't actually say the introduction of exploitation to a system was necessarily a bad thing, that indeed he regarded the shift from pastoralism to capitalism as a good thing. He conceded that, but didn't seem to think it affected his analysis much.
But it renders his analysis irrelevant. The term "exploitation" in the LTV is descriptive of a certain type of relationship between workers and capital, but is not necessarily a moral term at all. An analysis that does nothing other than make claims about the morality of exploitation says nothing if you don't take the term as a moral one, which apparently it wasn't.

quote:

If your reply is ‘Okay, B is better than A, but...’, then the LTV becomes irrelevant – what really matters is the criterion you’re using to decide under what circumstances exploitation is acceptable or not.

But without the LTV, you're generally not describing economics in terms of the relationship between labour's contribution and the rewards it receives at all. So you're not going to talk about exploitation, nor about under what circumstances it's acceptable. How then can the LTV be irrelevant? It would appear to be a descriptive economic framework within which you can discuss under what circumstances exploitation is acceptable. It could probably use some sprucing up, but then apparently it has received some.
It's really strange. First DeLong, an economist, objected to the LTV on moral grounds. Now you, an economist, seem to be objecting to the LTV on the grounds that it is economics rather than morality, and therefore irrelevant. Shouldn't those be moralists' objections, or perhaps soft-headed lefty ideologues' (like me), not economists'?


From: Caithnard College | Registered: Nov 2002  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 15 April 2005 08:24 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by Oliver Cromwell:
Or they could have traded wheat for capital goods at a non-explotative rate of exchange. The point is that capital accumulation is the result of sacrificed consumption.

Who would do the non-exploiting? The bank shall have their interests. Capital accumulation is the result of collective bourgeois action. The material accumulation goes far beyond what the bourgeois may themselves consume, and their human capital far beyond what they could use for their human needs. The fact is obvious.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
LeftRight
rabble-rouser
Babbler # 2379

posted 15 April 2005 08:44 PM      Profile for LeftRight   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
Originally posted by blueskyboris:
forum observer

1. No, I am not making the assumption that the demand for labour is unsatiable. I am aware of the Dark Ages.

2. Yes, I am assuming there can be more positions than labourers. The specialized and engineering fields are specific examples, and the the coming Baby Boom retirement is a general example. Boom cycles can also create a higher demand for more labour then (than presently) exists.

3. Necessarily? Heavens no.

4. ?? Labour Unions do not struggle for higher wages? ??


1) The 'dark ages'? 2)We should check the market to see if that ever happened and why ("over qualified"). Unfortunately the baby boom is not a material industry; it is a service industry that takes more material wealth for it's operation. I doubt it shall make very good stock investment for the market. It is also a need not an entertainment product. 3) whatever [the envious greedy envious greedy envious .....needy?] 4)unions strike, non-unions don't; this not a connection to mediate union and non-union employees wages.


From: Fraser Valley | Registered: Mar 2002  |  IP: Logged
Jason Kauppinen
rabble-rouser
Babbler # 5932

posted 15 April 2005 10:48 PM      Profile for Jason Kauppinen   Author's Homepage     Send New Private Message      Edit/Delete Post
quote:
AFAICT, Marxists are the only surviving proponents of the LTV, and this explains why they’re largely ignored by economists. The LTV simply doesn’t make any sense.

Righty-o.


From: Kingston, Ontario | Registered: May 2004  |  IP: Logged
maestro
rabble-rouser
Babbler # 7842

posted 15 April 2005 11:13 PM      Profile for maestro     Send New Private Message      Edit/Delete Post
quote:
It might be useful to recall some identities. These are not theories; they're relationships that must always hold, regardless of how the economy is structured:

Capital is accumulated expenditures on investment goods (i.e., productive capacity), less accumulated depreciation.

Savings = income minus expenditures on consumption goods.

Investment = savings.

Clearly, expected profits have a role in the consumption/savings decision: higher profits mean a higher returns on savings. And this generally means an increase in savings (or, equivalently, investment) that will in turn accelerate the rate of capital accumulation.

Profits may explain why capital is formed. But they're not how it's formed.

Just a clarification.


Wow! What a typical bit of obfuscation. None of this addresses the issue of where profits come from.

Profits start with the primitive accumulation of capital, which comes from forcing people off common property. In other words, theft.

Once capital has been accumulated, and labour forced into wage work, profits come from the difference paid to individual labourers and the value in their collective output.

Delong is trying to make forgone consumption the source of profits. That's just hogwash.


From: Vancouver | Registered: Jan 2005  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 15 April 2005 11:16 PM      Profile for Stephen Gordon        Edit/Delete Post
Well, I tried.

What is your opinion of pension funds?


From: . | Registered: Oct 2003  |  IP: Logged
Stephen Gordon
rabble-rouser
Babbler # 4600

posted 15 April 2005 11:38 PM      Profile for Stephen Gordon        Edit/Delete Post
Rufus:

You’re quite right to point out that there are two ways of looking at the LTV. One is moral, and says that exploitation is inherently a bad thing. Another is empirical, and says that the LTV is a useful way for analysing the world we observe.

In this context, the Delong model is designed to illustrate the weaknesses of the LTV as a universal moral principle. Being an economist in this context doesn’t give him (or me) any particular moral authority, but it does help clarify just what the choices are. Capital is the result of accumulated sacrificed consumption, and the stick-figure example is set up to bring this home. The decision of those 10 families to save and invest increased their income by 100%, and increased the other 90 families’ incomes by 50%. If the introduction of exploitation when none existed before was always a bad thing, then we would view this new situation as being worse than before. The fact that few people – apparently, not even Marx – are willing to say this seems to suggest that the LTV can’t be used as a moral guide in all contexts; some other criterion (presumably involving whether or not it increases the economic welfare of many/most/all households) is more important.

Nor does the LTV seem to be much use as a guide for empirical analysis; the transformation problem (how ‘values’ are transformed into the prices we observe) was identified some 100 years ago, and no-one yet seems to come up with a convincing solution. If a theory can’t generate predictions, its usefulness as a guide for explaining what we observe is essentially nil.


From: . | Registered: Oct 2003  |  IP: Logged
Rufus Polson
rabble-rouser
Babbler # 3308

posted 16 April 2005 04:14 AM      Profile for Rufus Polson     Send New Private Message      Edit/Delete Post
But, hang on, there aren't any economic theories that do a lot in terms of generating predictions.
From: Caithnard College | Registered: Nov 2002  |  IP: Logged
DrConway
rabble-rouser
Babbler # 490

posted 16 April 2005 04:44 AM      Profile for DrConway     Send New Private Message      Edit/Delete Post
*CRUMP* Thread closed, bagged, and tagged! You all know the routine.
From: You shall not side with the great against the powerless. | Registered: May 2001  |  IP: Logged

All times are Pacific Time  

Post New Topic  
Topic Closed  Topic Closed
Open Topic    Move Topic    Delete Topic next oldest topic   next newest topic
Hop To:

Contact Us | rabble.ca | Policy Statement

Copyright 2001-2008 rabble.ca