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

[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.