Article discreditng the thesis that Mao "killed millions of people" in The Great Leap

[kandrathe]

Again, you mistakenly think you can... win. Also, while I am encouraged that you actually cited a source, you chose a bad one.

Primitive accumulation of capital
From Wikipedia, the free encyclopedia

This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these template messages)
This article's factual accuracy is disputed. (January 2009)
The neutrality of this article is disputed. (March 2014)


This article needs serious rewriting
Reading this article makes one have the feeling like some hardcore marxist gave his heart leave to an outburst of "anti - burgoise" emotions. It's full of inaccurate and tendentious historical views about the beginnings of capitalism. I don't have anything against mentioning Marx' opinion, but when did Marx get a required training for giving such full - scale historical interpretations? And when did wikipedia start to advance old 19th century communist revolutionary philosophy of history views?

1.) This article needs to give honest account of interpretations of both the one side that introduced the term "previous accumulation" (Adam Smith) as well as interpretation of Marx and marxists. In this state, article promotes only marxist (or should I say, views of amateur philosopher Harvey, aotually a trained geographer) views about history and "criminal" acts of burgoise against poor workers. It totally neglects other views.

2.) This is basically a philosophical interpretation of the history of economy, particularly, history of England and "enclosure for sheeps". Historians have researched this period and have written about so called "previous accumulation" and enclosures, it's causes and effects. Article should report views of contemporary historians about this period, and current state of research. For example: [1] [2]

In this state, article seriously violates neutral point of view. Philosopher12 (talk) 16:21, 15 March 2014 (UTC)

Ph12, you may be unaware that the title is a Marxist subject and has little/no meaning outside of that except as a dog whistle for certain types. Given that and no more substantive complaint, delineation of a particular Marxist bias, e.g. Trotskyite, I will remove the tagging after a review as operation within the bounds of some body of knowledge is precisely what a (a good one anyway) encyclopedia is about. So first noting that "previous accumulation" is quite different from "original" or "primitive". Lycurgus (talk) 23:55, 2 January 2015 (UTC)

Philosopher12 is right; the article has been written from a marxist, WP:INUNIVERSE perspective, leading readers to believe that this stuff is actually true, rather than reflecting what reliable, mainstream, independent sources say. This is a common problem among marxist articles on wikipedia. bobrayner (talk) 09:27, 11 January 2015 (UTC)

In fact BR, you evince the only problem I can see here. You are conflating fiction with real world events, currents. "In universe" applies to works of fiction not major real world political movements. For any actual real world phenomenon, body of knowledge/thought, an interior perspective is the right, usual, and common sense way of exposition appropriate to a reference work. Lycurgus (talk) 01:45, 3 March 2015 (UTC)

No. Our neutrality policy requires us to present the mainstream view. Presenting obsolete Marxist ideas as though they were fact obviously fails this policy. It is never right or usual to present fringe ideas from an inside view. bobrayner (talk) 22:44, 19 March 2015 (UTC)

[Jester]

This is the stagnation we've been in under Obama. Fed monetary policy made it more lucrative to just leave the money in the bank. The Feds paid them to just leave it alone with zero risks.

No.



See that flat line at (nearly) zero since 2008? That's what Fed policy pays capitalists to leave their money in the bank: nothing. And that's zero *nominal* - if there is even mild inflation, you get less than nothing.

Whatever else, this is obviously not the right narrative about why investment has been slow to recover.

-Jester

[kandrathe]

This is the stagnation we've been in under Obama. Fed monetary policy made it more lucrative to just leave the money in the bank. The Feds paid them to just leave it alone with zero risks.

No.

See that flat line at (nearly) zero since 2008? That's what Fed policy pays capitalists to leave their money in the bank: nothing. And that's zero *nominal* - if there is even mild inflation, you get less than nothing.

Whatever else, this is obviously not the right narrative about why investment has been slow to recover.

Yes, the rate is low... but... since the change in 2008 to pay interest on reserves, ( https://www.federalreserve.gov/monetaryp...lances.htm ) at 0.75%



A small rate on a large pile of cash is merely profit, at US taxpayer expense.

http://www.frbsf.org/education/publicati...-reserves/

[Jester]

This is not the Fed's doing. The value of parking one's cash in fed reserves in order to earn an absolutely trivial return is surely a sign that there are no better places to park one's money, otherwise why would a mere fraction of a % return attract funds? The argument that this is somehow a critical component of the shortfall in investment seems to be nothing more than grasping at straws to somehow blame the Fed.

Nobody is going to get rich earning a fraction of a %, nominal, on reserves. This is not the behaviour of canny investors looking to rook the taxpayer, but terrified investors, looking for safety. If it isn't, then why were investors not parking their money in such quantities in banks for the 50 years prior? Interest rates were higher, not lower - even real interest rates, for most of the period.

This dog does not hunt, as Occhi would say.

-Jester

[FireIceTalon]

Capitalists expropriate surplus value from workers because said capitalists own the means of production (capital), and workers are forced to sell their labor power to said capitalist class in order to survive even though it is workers who produce all objective social value in society (including the capital they then use to create new value) - this is an antagonistic relationship that could NEVER, under any fathomable circumstances, exist without being upheld violently by some sort of state apparatus. So yes, this amounts to capitalists being moochers, free-loaders, and welfare queens or whatever other term you wish to use that correctly implies that they do NOT produce social value. This is all FACT, not an opinion. What is so goddamn fucking difficult to understand about this? Fucking christ almighty......it doesn't take a rocket scientist to see and understand this shit.

What is even more puzzling is that you basically already admitted this to be true:

Marx correctly pointed out a problem with "surplus value" and exploitation

But then you turn around and pull the red herring fallacy that capitalist exploitaton is somehow justified because they take "risks" - which I already demonstrated that they really don't, and even if they did, that it STILL isn't a justification for the power and privilege they hold over everyone else. So...



You can't have it both ways - your position is entirely incongruent. Either you accept Marx's position to be correct, and therefore justification for the extraction of surplus value and the resulting exploitation is untenable by default; or, you reject his position (which you acknowledged as being correct and thus renders your argument as invalid; unless you change your original position to that he WASN'T correct which makes your argument consistent but then makes you a flip-flopper and it becomes hard to take you seriously), and this leads to justifying capitalist exploitation (which has the further problem, again, of having serious sociopathic implications). So which is it? Either way, it isn't a good look for you.

[Jester]

This is all FACT, not an opinion. What is so goddamn fucking difficult to understand about this? Fucking christ almighty......it doesn't take a rocket scientist to see and understand this shit.

All this suggests is that you do not understand what the word "fact" means. You make a lot of interpretations, assertions, predictions. But those are not facts, and if you think they are, then you are deeply confused.

-Jester

[FireIceTalon]

Prove to me that they aren't facts, that they are just something I've conjured up in my imagination. Disprove everything I said in that post. This should be good.

[Jester]

Prove to me that they aren't facts, that they are just something I've conjured up in my imagination. This should be good.

What you really mean to do (I hope) is assert that your preferred theory is true, that it correctly maps on to the facts of the world, that it affords predictive and explanatory power. But that requires understanding what part of what you are saying is theory, and what part is fact, and in that regard, you seem quite lost.

-Jester

[FireIceTalon]

This is just an argument of semantics. Yes, an important part of the social relationship that I described is based around the 'Labor THEORY of value'. A theory which, whether you like it or not, is valid.

[kandrathe]

Nobody is going to get rich earning a fraction of a %, nominal, on reserves. This is not the behaviour of canny investors looking to rook the taxpayer, but terrified investors, looking for safety. If it isn't, then why were investors not parking their money in such quantities in banks for the 50 years prior? Interest rates were higher, not lower - even real interest rates, for most of the period.

This dog does not hunt, as Occhi would say.

-Jester

Ok, I see. I'm not really blaming the fed, so much as saying the 2008 acceleration of the 2006 law change had the unintended consequence of allowing (removing the disincentive) pooling reserve deposits. The upside is the security of the banking sector, the downside is a dearth of available capital for economic expansion. The law sought to remove the disincentive for banks to keep reserves due to it being "unused capital".

[kandrathe]

This is just an argument of semantics. Yes, an important part of the social relationship that I described is based around the 'Labor THEORY of value'. A theory which, whether you like it or not, is valid.

There are other opinions. You choose to believe that one is true. I do not. i give Marx his due credit for his contribution in revealing the flaws in classical economic theory. But, I do not concur he was correct in his conclusions. You and I even agree on the "problem" of the modern employer/employee model to some extent where the employee feels "trapped in labor" by their immediate needs for basic survival. But, take away the option of employment (or the condition of their being meaningful, enjoyable work to do). Are we not still in an even greater pickle in barbaric competition for our material needs? I'm not so inclined to blame the system for the core issue of our needs to survive. For now, consider that perhaps status quo is better than no system.

For example, Eugen Böhm von Bawerk in History and Critique of Interest Theories (1884)

Book I, Chapter IV - Adam Smith and the Development of the Problem is a critique of Smith's simplified view of the labor theory of price, and Book VI - The Exploitation Theory is a critique of various contributors to the mid 1800's theories developing the 'labor theory of value'. Book VI - Chapter III goes into great detail in a critique of Marx.

NOW BEFORE YOU JUMP IN AND WRITE A WALL OF TEXT on Böhm von Bawerk's book...

I'm only pointing to the plethora of alternatives of thought on one thing that differs from your LTV world view, one you ardently believe in to be "fact". Your intolerance of other world views does not make yours correct, and your inability, or unwillingness to consider alternatives makes any discussion with you frustrating. As you've indicated, you see it as a contest where you can "win".

[FireIceTalon]

Fair enough.

Can't really say I look at it as a "contest" though. I'm just a bit more "amped up" and passionate in my political convictions than most other people I guess, but this is true in everything about me and whatever I endeavor in. I don't deny it, I can be quite over the top at times.

But I don't think of it as me coming on here and trying to "win arguments" with random people I've never met. I look at it, believe it or not, as a learning process to better understand - and counter - the objections to the framework I operate within. I also learn more about my own political views in the process. I've learned an INCREDIBLE amount over the last 4 years or so about Marxian economic theory, and although a significant reason for that was reading texts as well as learning from other comrades, alot of it was also from the "debates" that I've had here on LL.

Sure, things get heated sometimes, but I'm not out to get anyone here. I promise. Mostly, just to engage in interesting and lively political discussions. We disagree on almost everything just because we operate within two completely different frameworks and thus speak a different political language, but sometimes your posts get me to really think and force me to gather my thoughts, do some research, and sharpen my knowledge to be able to engage what you said. Sometimes, these exchanges are quite a rush where I eagerly await to see what your response will be and how much it will challenge me to think about and engage it.

[Alram]

Collective farming has been a disaster throughout the communist world.

[Jester]

This is just an argument of semantics. Yes, an important part of the social relationship that I described is based around the 'Labor THEORY of value'. A theory which, whether you like it or not, is valid.

It isn't semantics. The Labour Theory of Value is, as you say, a theory. If it was valid, it would reliably lead us from old truths to new ones. But it would also be called into question by any situation where it led us from truth to falsity.

In this particular instance, the Labour Theory of Value is a troublesome problem even for diehard Marxists trying to interpret the great master's thoughts. It doesn't obviously parse into a universal theory of either values or prices generally. How does it help us understand the value of a historic building? Of knowledge and expertise? Of intellectual property? Why is owning the rights to Star Wars so much more valuable than owning the rights to Waterworld? Why is beachfront property so much more valuable than inland property? Why does the price of agricultural products go up when most of a crop is ruined just after harvest? Why are fashion products so expensive, yet valued so differently? Why are haircuts in one country versus another priced so differently, when both their labour inputs and use values are nearly identical? It just doesn't have much use for these problems - we need more sophisticated theories of value.

Salvaging any use from the Labour Theory is tricky; the usual way is to restrict the theory to exclude the obvious exceptions. It is passable as a restricted theory of the long-run price of manufactured commodities, under some assumed normal conditions, in competitive markets. I personally find it useful in understanding the way that wages can increase with economic growth even for the least skilled workers. But that seems like the opposite of the use Marx wanted to put it to.

One can also try to salvage the theory by trying to jump through enough hoops to somehow relate every conceivable value back to labour time. For example, beachfront property is valued because of the labour time it would cost to provide the same level of enjoyment-of-warmth-and-scenic-views, thus a beach functions like a piece of machinery, which is simply the value of "dead" labour. But that road is just madness, in my view, and yields no insights, only tortured attempts to make exceptions fit the rule.

So, no, the labour theory of value is neither valid nor complete. At best, it has restricted applications to easy problems. We know this because it predicts facts to be true that are known to be false, and there are many known facts which are incompatible (or at least inexplicable) with the labour theory of value.

-Jester

---

Ok, I see. I'm not really blaming the fed, so much as saying the 2008 acceleration of the 2006 law change had the unintended consequence of allowing (removing the disincentive) pooling reserve deposits. The upside is the security of the banking sector, the downside is a dearth of available capital for economic expansion. The law sought to remove the disincentive for banks to keep reserves due to it being "unused capital".

The disincentive to pooling reserve deposits is, and has always been, opportunity cost. That's the same as with any bank - you only save your money there if you think it won't make you more money elsewhere. (Including liquidity concerns, of course.) At most, paying interest on reserves reduces the opportunity costs of holding those reserves by 0.75% per year. The only reason that would be important, is if the opportunity costs were already very low, and the only reason that would be true is if there is a severe shortage of investment opportunities. The Fed does not control the available investment opportunities in the economy; if those are poor, that's someone else's problem.

-Jester

[FireIceTalon]

This is just an argument of semantics. Yes, an important part of the social relationship that I described is based around the 'Labor THEORY of value'. A theory which, whether you like it or not, is valid.

It isn't semantics. The Labour Theory of Value is, as you say, a theory. If it was valid, it would reliably lead us from old truths to new ones. But it would also be called into question by any situation where it led us from truth to falsity.

In this particular instance, the Labour Theory of Value is a troublesome problem even for diehard Marxists trying to interpret the great master's thoughts. It doesn't obviously parse into a universal theory of either values or prices generally. How does it help us understand the value of a historic building? Of knowledge and expertise? Of intellectual property? Why is owning the rights to Star Wars so much more valuable than owning the rights to Waterworld? Why is beachfront property so much more valuable than inland property? Why does the price of agricultural products go up when most of a crop is ruined just after harvest? Why are fashion products so expensive, yet valued so differently? Why are haircuts in one country versus another priced so differently, when both their labour inputs and use values are nearly identical? It just doesn't have much use for these problems - we need more sophisticated theories of value.

Salvaging any use from the Labour Theory is tricky; the usual way is to restrict the theory to exclude the obvious exceptions. It is passable as a restricted theory of the long-run price of manufactured commodities, under some assumed normal conditions, in competitive markets. I personally find it useful in understanding the way that wages can increase with economic growth even for the least skilled workers. But that seems like the opposite of the use Marx wanted to put it to.

One can also try to salvage the theory by trying to jump through enough hoops to somehow relate every conceivable value back to labour time. For example, beachfront property is valued because of the labour time it would cost to provide the same level of enjoyment-of-warmth-and-scenic-views, thus a beach functions like a piece of machinery, which is simply the value of "dead" labour. But that road is just madness, in my view, and yields no insights, only tortured attempts to make exceptions fit the rule.

So, no, the labour theory of value is neither valid nor complete. At best, it has restricted applications to easy problems. We know this because it predicts facts to be true that are known to be false, and there are many known facts which are incompatible (or at least inexplicable) with the labour theory of value.

-Jester

No, the LTV is in fact quite well understood by any competent Marxist economist. It is in fact, bourgeois classical economists who have misconstrued or displayed ignorance/trouble in understanding both Marx as a whole and the LTV in general - both intentionally and unintentionally. I suggest you read the following:

http://www.marxist.com/in-defence-of-ltv.htm

Your argument seems to be similar to the following:

Francis Wheen, in his book entitled Marx’s Das Kapital -- A Biography, believes he has hit upon a major contradiction in Marx, but simply reveals an ignorance of Marxist economics, a basic flaw with such writers.

“‘So far,’ Marx writes, ‘no chemist has ever discovered exchange-value either in a pearl or a diamond.’

“This is a curious example to choose, since it exposes a limitation in Marx’s own theory. If, as he implies, the exchange-value of pearls and diamonds derives solely from the labour-time spent on retrieving and transforming them, why do people sometimes pay hundreds of thousands of pounds for a single diamond ring or pearl necklace? Mightn’t these extraordinary prices also owe something to scarcity value, or to perceptions of beauty, or even to simple one-upmanship? If labour-time alone were the determinant factor, a doodle on a restaurant napkin by Picasso or a hat once worn by John Lennon would be worth no more than a few pounds -- and the ‘value’ of a bottle of claret from a great vintage would be identical to that of an inferior vintage, if both embody the same quantity of labour…

“The labour theory of value may be of little assistance in understanding why a few of Elvis Presley’s hair-clippings, collected by his barber, sold for $115,000 at auction in 2002.”

But this is a typical example of how classical economists misunderstood Marx and his analysis of the LTV. Most of the things you listed above are either monopoly or scarce based products.

Marx never said that exchange-value was the only thing that determined price. Works of art, such as John Lennon’s hat or Elvis’s hair-clippings, cannot be produced or reproduced, except as inferior imitations, and therefore such things are unique, one-off things. This monopoly situation has a direct bearing on their price or what simply people are prepared to pay. Their price is not based on their original value, but is determined solely by supply and demand, as Marx and the classical bourgeois economists had explained. In practice, such unique things lie beyond the realm of the labour theory of value, which deals with commodities that can be reproduced without limitations or restrictions. What we are dealing with here are monopoly prices. If the item is one of a kind, the restricted supply means it can attract an astronomical price. This has nothing whatsoever to do with their original value, but simply the uniqueness of the object and what people are prepared to pay.

The classical economist, David Ricardo, explained this point very well. “There are some commodities,” he wrote, “the value of which is determined by their scarcity alone. No labour can increase the quantity of such goods, and therefore their value cannot be lowered by an increased supply. Some rare statues and pictures, scarce books and coins, wines of a peculiar quality, which can be made only from grapes grown on a particular soil, of which there is a very limited quality, are all of this description. Their value is wholly independent of the quantity of labour originally necessary to produce them, and varies with the varying wealth and inclinations of those who are desirous to possess them.”

Yes, there are certain commodities which cannot be explained by the LTV alone, but Marx nor Ricardo ever said they did. By and large, though, political economy is STILL governed by the LTV, and this is certainly the case for the products that we actually NEED in order to survive.

[Jester]

No, the LTV is in fact quite well understood by any competent Marxist economist. It is in fact, bourgeois classical economists who have misconstrued or displayed ignorance in understanding both Marx as a whole and the LTV in general - both intentionally and unintentionally.

In addition to this just being an assertion, it is also a strawman. I make no argument about who has understood or misunderstood the labour theory of value, but about the validity of the theory itself.

I suggest you read the following:

http://www.marxist.com/in-defence-of-ltv.htm

There does not seem to be any useful shadow of an economic argument there. Was there some argument in particular contained therein that is of use?

But this is a typical example of how classical economists misunderstood Marx and his analysis of the LTV. Most of the things you listed above are either monopoly or scarce based products.

If one's theory of value is incapable of describing the value of scarce products (unless "scarce based products" means something else?) then I might suggest it is a useless theory, because everything we care about is scarce. Nothing can be reproduced "without limitations or restrictions," and if the labour theory explains only those things that can be, then it explains nothing. Economics is the study of scarcity. That's the whole point of having theories of price and theories of value.

If the theory claims that there is an abstract thing called value, imbued on objects by labour alone, which may or may not have anything to do with either use-values or exchange-values (prices), then this is an ethical stance, not a scientific theory. It does not describe observable things, and does not offer any empirical predictions. This is a dead end for saving the labour theory of value as a useful contribution to economic theory.

Yes, there are certain commodities which cannot be explained by the LTV alone, but Marx never said they did.

So, you accept that there are commodities whose value cannot be explained by the labour theory of value (which is a criticism of the *theory*) but your defense is that Marx did not say they could be? But that is a defense of Marx, not a defense of the LTV. Can you defend the theory, or no?

-Jester

[FireIceTalon]

In addition to this just being an assertion, it is also a strawman. I make no argument about who has understood or misunderstood the labour theory of value, but about the validity of the theory itself.

Not a strawman. Understanding competently the theory has a direct relationship to being able to conclude whether or not the theory is valid - an understanding which you, and most bourgeois economists in general, seem to lack.

There does not seem to be any useful shadow of an economic argument there. Was there some argument in particular contained therein that is of use?

There is all kinds of solid economic arguments made throughout in it. For instance:

In contrast, the whole marginal utility approach is based upon a microeconomic perspective, and has little, if anything to do with the macroeconomic level of things. It is essentially a one-sided, undialectical, reductionist approach to capitalist economy. While Marxism fully understands the dialectical unity of different levels of the capitalist economy, bourgeois economics maintain a massive Chinese wall between the micro and macro. Chris Giles, a columnist for the Financial Times, revealed the bankruptcy of bourgeois economics when he wrote recently, “Economists live in secluded silos. Absorbed in abstract thought, those at the academic frontier rarely have much useful to impart to those grubbing around real policy issues. The pond life in the microeconomic policy puddle too seldom talks to those in the macro pool -- and vice versa.”27

This reflects their whole narrow abstract outlook and false method. They are incapable of understanding capitalism as a whole, in its real development and contradictions, as this is not their intention. The marginal school is maintained solely in order to prove and promote the subjective view, namely that of the atomised individual. Their view is based upon a false abstraction in an attempt to mystify the real relationships -- class relationships -- under capitalism. We are led to believe that we are all individuals, with our individual preference, irrespective of our class or income. The idea was represented by Thatcher when she said there was no such thing as society. But as soon as we think in terms of society as a whole, the labour theory of value becomes self-evident. The total number of hours worked by society is the ultimate factor of production, which is then divided amongst the needs of society. This is the central feature.

“The peculiar fetishism of the Austrian School,” explained Bukharin, “which provides its adherents with individualistic blinders and thus shuts off from their view the dialectical relation between phenomena -- the social threads passing from individual to individual and alone constituting man a ‘social animal’ -- this fetishism precludes any possibility of their understanding the structure of modern society.”

If one's theory of value is incapable of describing the value of scarce products (unless "scarce based products" means something else?)

Indeed, 'scarce based products' does mean something else, although it was Ricardo rather than Marx who first explained this. You fail to understand that price (which is subjective) has little or no relationship to value (which is objective). Value is created in the realm of production, not in the realm of exchange. Also from the article:

The classical economist, David Ricardo, explained this point very well. “There are some commodities,” he wrote, “the value of which is determined by their scarcity alone. No labour can increase the quantity of such goods, and therefore their value cannot be lowered by an increased supply. Some rare statues and pictures, scarce books and coins, wines of a peculiar quality, which can be made only from grapes grown on a particular soil, of which there is a very limited quality, are all of this description. Their value is wholly independent of the quantity of labour originally necessary to produce them, and varies with the varying wealth and inclinations of those who are desirous to possess them.”

Ricardo then goes on to explain that “these commodities, however, form a very small part of the mass of commodities daily exchanged in the market. By far the greatest part of those goods which are the objects of desire, are procured by labour; and they may be multiplied, not in one country alone, but in many, almost without any assignable limit, if we are disposed to bestow the labour necessary to obtain them.”

“In speaking then of commodities, of their exchangeable value, and of the laws which regulate their relative prices, we mean always such commodities only as can be increased in quantity by the exertion of human industry, and on the production of which competition operates without restraint.” 17

Objects, which are not products of human labour, and do not have value, can certainly have a price when offered for sale. Through their price they take on a “commodity form”. As Marx explained, “things which in and for themselves are not commodities, things such as conscience, honour, etc., can be offered for sale by their holders, and thus acquire the form of commodities through their price. Hence a thing can, formally speaking, have a price without having a value. The expression of price is in this case imaginary, like certain quantities in mathematics.” 18 He goes on to give the example of the price of uncultivated land, which is without value because no human labour has been spent in its production. Nevertheless, given an attractive location, it can attract a hefty price.

Society however cannot live off honour, works of art or priceless artefacts, no matter what their price. Human beings can only live by the production of real wealth. Labour transforms nature and forms the basis for the production and reproduction of life. As Marx explained, it is socially necessary labour time, expressed in value, which lies at the centre of things. Monopoly prices are a product of definite circumstances, and do not reflect value as such. Despite our critics, the law of value, remains the key regulator of the capitalist economic life.

because everything we care about is scarce.

False. You are conflating actual scarcity with artificial scarcity. Production under capitalism (along with laws that protect private property) is structured in such a way that it is in the direction of profit and not use-value, so it deliberately creates scarcity in many places where there would otherwise be none. There are plenty of observable examples of this.

Nothing can be reproduced "without limitations or restrictions," and if the labour theory explains only those things that can be, then it explains nothing.

Not only is this a rigid assertion, it is also a propositional fallacy.

Economics is the study of scarcity.

In the context of bourgeois vulgar economics, this could very well be the case, and the study of economics in that realm as being the study of "scarcity" seems indicative to how they approach it. Too bad it is a myopic framework, placed upside down on its head, that completely ignores historical and social forces and political factors that CANNOT be separated from the realm of economics. This of course, is done on purpose, and you know very well why.

http://www.worldsocialism.org/spgb/socia...-economics

Marx made a distinction between such men as Petty, Smith and Ricardo and their successors. He wrote of the former that they devoted their efforts 'to the study of the real interrelations of bourgeois production', while the latter were 'content to elucidate the semblance of the interrelations' and to act in effect as apologists for the capitalist class. He called them 'vulgar economists'.

Engels had already warned, and shown great foresight, in 1843 when he wrote in his Outlines of a Critique of Political Economy: 'The nearer to our time the economists whom we have to judge, the more severe must our judgment become. For while Smith and Malthus found only scattered fragments, the modern economists had the whole system complete before them: the consequences had all been drawn; the contradictions came clearly enough to light, yet they did not come to examine the premises and still accepted the responsibility for the whole system. The nearer the economists come to the present time, the further they depart from honesty'.

That last part has particularly proven true, even and especially today, to the point where even bourgeois economists are admitting having difficulty in propping up their theories without them having look like propaganda for capitalism rather than being scientific theories that seek to actually provide any insight has to how things actually work or make empirical obervations and predictions.

If the theory claims that there is an abstract thing called value, imbued on objects by labour alone, which may or may not have anything to do with either use-values or exchange-values (prices), then this is an ethical stance, not a scientific theory.

Again, value is objective, and is created in the realm of production - not in the realm of exchange. So no, the LTV is not an ethical stance (one could try and justify it through an ethical context by saying something like "extracting surplus value from workers is morally wrong because its theft", but that isn't the basis for the LTV or for Marxist theory in general - class interests are objective - any ethical or moral implications that result from them are an afterthought and not used as the basis for understanding political economy).

It does not describe observable things, and does not offer any empirical predictions.

Actually it is your theory, of marginal utility, that suffers this problem - not the LTV.

You will notice that more often than not the supporters of marginal utility prefer to give “examples” about water and diamonds, rather than ordinary mass-produced commodities, that can be reproduced at will. They fail to explain, for instance, why the price of bread in the shops is the same for the hungry unemployed person as it is for the millionaire tycoon, despite the fact that the marginal utility of an additional unit is a thousand times more for the former than the latter. This is conveniently swept under the carpet by these theorists.

For the Marginalists, we are all simply individual “consumers” with so much money (“effective demand”) with which to make individual choices. The fact that under capitalism, we are faced with massive levels of inequality, generated by the workings of the market economy, is completely ignored. The fact that the working class is incapable of buying back the full value of its labour never enters the Marginalists’ head. Such contradictions are of no concern to them and their mechanical view of economics. Nevertheless, their abstract examples are the theoretical bedrock of marginal utility theory, and the rotten floor on which modern bourgeois economics stand.

The whole Marginalist theory is rooted in the concept of individual consumer preferences, namely that our value judgements about our purchases are the basis of the value of commodities. In fact, our value judgements do not decide the exchange-value of commodities. While these expressions use the same word (“value”), they have very different meanings, based upon a whole different outlook.

In reality, the marginal utility school is the subjectivist land of Robinson Crusoe, or the “isolated man”, to use the words of Böhm-Bawerk. Economics, based upon a subjective preference theory, is reduced to individual tastes and individual choices, which serve to maximise a thing’s utility. This approach is completely abstract without any notion of real society. Market relations are simply individual relations between a person and a commodity. For the Marginalist, it is individual behaviour that is the key to understanding the capitalist economy. Using this reductionist approach, they want us to artificially strip away all the social and historical vestiges of capitalism, including existing class relationships, in order to reduce everything to this simple model of individual behaviour. The whole concept is a false abstraction. It has no historical content. As a society, we do not live as individuals in isolation on a desert island, like individual atoms. Our natural desires/choice preferences are not inborn, or subject to “free” choice, but are a product of society and our place within it. It is not simply a question of individuals confronted with choices in a supermarket, irrespective of time and place. How does the subjectivist island of the Marginalists translate into the realities of everyday capitalist relations? They do not. That is why, in their myopic world, they have no explanation of capitalist crisis.

Marginal utility is in short, idealist nonsense, constructed and operating only in the realm of microeconomics, that bears no relationship to capitalist reality.

[Alram]

Value is objective? Please explain.

[Jester]

Indeed, 'scarce based products' does mean something else, although it was Ricardo rather than Marx who first explained this. You fail to understand that price (which is subjective) has little or no relationship to value (which is objective).

Okay, then. What is the difference between "scarce products" and "scarce based products"? I do not understand this distinction.

Either the LTV is a theory of price, or it is a theory of value (meaning something other than price). If it is a theory of value, the question is, what kind of value. It is clear it does not mean use-value, because that is subjective, nor exchange-value, because that is price. We could, of course, say that value is *intrinsically* the value of labour power inputs, but that would be a tautology - all value is labour value because all value is defined as labour value.

But if it isn't that, then what IS it? What does it help us DO?

For Ricardo, the answer was obvious: It does tell us about prices. The exceptions to the labour theory are real, because they do *not* tell us about prices. For Ricardo, it was not a satisfying theory, but it was the best he had, fully acknowledging its exceptions. As you quote, he suggests that commodities not well described by the labour theory (as a theory of *price*) are only a small part of the economy.

That may well have been true in 1800, but it certainly isn't true today. Real estate in large cities. Blockbuster movies. Airline tickets. Patent medicines. High-education services. These are not tiny parts of the economy any more, and the failure of the labour theory to describe them is not a small matter. It means, as I said earlier, that at best, the labour theory explains a restricted set of prices.

The labour theory is also useless at international economics, and has essentially nothing to say about the fact that labour prices vary enormously across the world. Does my London haircut have the same "value" as a haircut produced in Mumbai at a fraction of the price? If so, what does this even mean? If not, how is that compatible with a labour theory of value?

Objects, which are not products of human labour, and do not have value, can certainly have a price when offered for sale. Through their price they take on a “commodity form”. As Marx explained, “things which in and for themselves are not commodities, things such as conscience, honour, etc., can be offered for sale by their holders, and thus acquire the form of commodities through their price. Hence a thing can, formally speaking, have a price without having a value. The expression of price is in this case imaginary, like certain quantities in mathematics.” 18 He goes on to give the example of the price of uncultivated land, which is without value because no human labour has been spent in its production. Nevertheless, given an attractive location, it can attract a hefty price.

This is exactly the sort of gnomic evasion that makes Marx so difficult. Things which are not produced by labour but have the form of commodities have price, but not value, because value is imbued by labour. Their price is "imaginary, like certain quantities in mathematics." But that doesn't mean anything! It doesn't map usefully onto an idea of imaginary numbers, or variables, or any other mathematical concept. It's just a way of saying that value is NOT observable, and therefore, we are back to the ethical interpretation - the labour theory of value says nothing scientific, but is instead an ethical statement, about what we SHOULD value.

Monopoly prices are a product of definite circumstances, and do not reflect value as such. Despite our critics, the law of value, remains the key regulator of the capitalist economic life.

As an empirical statement, these "definite circumstances" are all around us, all the time. They are not strange exceptions, they are entirely normal occurrences. I can point to dozens of exceptions in the room I am sitting in. The room I am sitting in *itself* is an exception. The internet I am typing this on, and its provision, is an exception. The computer programs used to process this information are all exceptions. The coffee in my cup is an exception.

As I said, the labour theory of value of limited use, in describing the *simplest* commodities - shirts, cars, televisions. And even then, it doesn't really add anything, it's just a different way of understanding input costs, with an arbitrary focus on labour.

False. You are conflating actual scarcity with artificial scarcity. Production under capitalism (along with laws that protect private property) is structured in such a way that it is in the direction of profit and not use-value, so it deliberately creates scarcity in many places where there would otherwise be none. There are plenty of observable examples of this.

Most of the scarcity that matters is not artificial. Space in cities is limited, and people inflict congestion externalities. Roads only fit so many cars before they turn into parking lots. Air space is limited, and overfilling it leads to plane crashes. Infrastructure of all kinds is scarce, and building more of it is much more complex than simply adding labour, because it inflicts costs on others.

Abolishing property rights does not remove scarcity. The whole point of property rights is to incentivize production and trade, and to disincentivize theft and destruction. You can say this is all an elaborate edifice created by the ruling classes etc, etc, but it's not the fundamental source of economic scarcity.

This of course, is done on purpose, and you know very well why.

Please stop doing this. You cannot read my mind, nor can I read yours. It reeks of conspiracy theory, and adds no value to the argument.

Again, value is objective, not subjective or abstract.

(...)

Actually it is your theory, of marginal utility, that suffers this problem - not the LTV.

What are the objective, empirical predictions of the LTV, that demonstrate its usefulness? You've already said you don't view the LTV as being about prices, so what is it about, that we can observe and measure, to test whether the LTV leads us from truth to truth?

-Jester

[EspyLacopa]

Again, value is objective, and is created in the realm of production - not in the realm of exchange.

So, water in a desert has the same value as water in a city by a lake?

After all, you don't produce water, it's just a thing you pipe out to places and exchange it.