When I saw the Mattick stuff you posted, I thought, wow, this is the perfect example to illustrate what happens when you confuse wages with the value of labor power, following up on our discussion from last summer. Mattick saying the following is simply jibberish: "The increase in profits by means of inflation encounters definite barriers, however, as the reduction of the value of labor power has absolute limits, and even these cannot be reached because of the resistance of the workers". Inflation reduces real wages, not the value of labor power. And, with a given wage, workers welcome a reduction of the value of labor power because it is the cost of their necessities. They can buy more of them or a luxury or two! What clearer example of this kind foolishness, committed by marxists all time, can there be?
But I made the mistake of using v as a shorthand for the vlb and, I see, confusion reigned.
So, as a preface to one more stab at this, back to the beginning: the distinction between, vlb, v, and wages. I'll be brief. When Marx developed the capitalist law of value, he distinguished between labor and labor power, and determined the value of labor power to be what it costs to reproduce (productive) labor in a given social setting. When he set down production of goods and services in notational form, he wrote c+v+s--output consists of constant capital plus variable capital plus surplus value. This the *value* form of production. Theses values correspond to the *money* form (after the exchange process) of depreciation, wages, and profits. Thus, variable capital (v) is the notational value form of the value of labor power (the reproduction cost of labor).
I said all of this last summer, both on list, and in a couple of offlist notes to you. I see I made no dent. You say again that wages are the same thing as variable capital, as if you have no idea about the difference between the value and price form, between value and exchange relations. To say nothing of the fact that if they are the same thing, why do both terms exist--why did Marx bother with v, since obviously wages as a term already existed, and was well understood? (As you know, he created the value form to get behind exchange relations.) If wages and variable variable capital are the same magnitudes, that means, with a given c/depreciation, surplus value and profits must also be the same! Surely you can't believe that! You know that today surplus value is realized in exchange in many ways, profits being only one of them.
But suppose you still find all of this unconvincing and cling to your wage-variable capital equation. For this discussion of Mattick, *it doesn't matter*. He writes only of the value of labor power being the same as wages. He never mentions v. Forget my lazy notation of v for the vlp. Substitiute vlp for v in what I said and think about it. From day one in our discussion you have said you understand that wages can vary from the value of labor power, and that is all that is necessary to see Mattick's mistake now.
Now to your comments.
Rakesh wrote:
> You will have to clarify whether by v you mean value of labor power or
> variable capital. The increase in profits by means of
> inflation encounters definite barriers, however, as the reduction of the
> value of labor power has absolute limits, and even these cannot be reached
> because of the resistance of the workers.
>
> Inflation does increase surplus value by way of upward redistribution of
> value. It is not itself the additional production of value. Mattick speaks
> precisely here.
If I understand this it appears to be the same thing I said, yet you seem to think you're expressing some disagreement with my cricism of Mattick ("Mattick speaks precisely here"). I said inflation adds nothing to surplus value, but instead redistributes some of it from labor to capital. You say inflation "is not itself the additional production of value"--apparently agreeing with my first point. And you preface that with "inflation does increase surplus value by way of upward redistribution of value". From whom? Labor, right? Which, again, is what I said.
> The increase in profits by means of
> >inflation encounters definite barriers, however, as the reduction of the
> >value of labor power has absolute limits, and even these cannot be reached
> >because of the resistance of the workers.
As shown above this is the key passage of Mattick that I said showed his confusion most clearly. But here you're replying to him, not me. I guess you wanted to take your own crack at it?
> The value of labor power rises and falls simultaneously. This is not a
> paradox. It depends on what it is in relation to.
>
> At one level, value of labor power is a dynamic entity which includes a
> historico-moral element which itself is *partially* determined by the
> strength of the class struggle within narrow boundaries. That is, the
> historico-moral element is not a wholly indeterminate entity; it is
> conditioned first and foremost by the development of the productive forces.
> The value of labor power in terms of the use values enjoyed will thus tend
> to increase with the development of the productive forces, though how much
> will depend on the class struggle.
>
Yes and no. Labor productivity can raise the vlp by making more goods and services available as social necessities. But it also can lower the vlp but cheapening those g&s (which I mentioned in my note).
> But at the same time the value of labor in relation to total capital falls
> exactly because of how the declining unit values of the (increased)
> commodities that go into the workers reproduction allows the rate of
> exploitation to increase even with rising living standards.
Yes, the vlt can fall absolutely, as I just said, and it can fall relative to capital, as you indicate here. Certainly with a given surplus value, a falling vlp (actually we must write v here, damn it, because v and s are the comparable notational value forms) implies a rise in s/v (the rate of exploitation).
> Now the wages of certain workers may even rise over the value of their
> labor power, but there are good reasons to believe that capital will have
> the upper hand in ensuring such a situtation is temporary and surely does
> not obtain for the class as a whole (these are the same reasons why Brenner
> casts doubt on any story of increased worker power). It is also possible
> for wages to fall below the value of labor power but this will tend--if it
> does not provoke the revolt of the working class--to exhaust or even
> annihilate the working force so capital cannot rest on such a foundation
> unless a nazi employment policy, as described by Kalecki and Doug, is
> implemented.
Your version of the variation of wages from the vlp. But I must quarrel with one part of it. At about the same time Mattick was writing this stuff, Ronald Meek made an interesting observation. Wages surley exceed the vlp, he said, and have done so consistently for some time. If Marx were to come back, this is one of the first things he would notice, Meek said, and he would set out to find an explanation, which would have great bearing on his understanding of the laws of motion. Meek said that in part, I think, because of the appalling number of marxists who don't even understand that wages can vary fron the vlp (they think they are the same).
But the point is, at least for advanced capitalists countries wages were signficantly larger than the vlp, and remained so for decades. Probably still true now for many workers. And certainly has been true for labor as a class in the major capitalists powers. Was it, or is it, true world wide? Hard to say. First you have to figure out what the vlp is in each place, because it is socially determined, and varies in several ways, before you can answer that question.
> >No, it's a reduction in real wages, not a lowering of v, and this produces no
> >necessary link to crisis.
>
> To the extent that v as variable capital is money wages to productive labor
> (again this is a variable sum of money-capital because the commodity it
> buys enables production of greater value), then money wages can rise though
> real wages are undercut by inflationary pressure. This was why Keynes was
> welcomed by German finance capital.
There is that wages to v equation again. And the rest is a banality: Money wages can rise while real wages fall. Ok. That's, in fact, usually the way it works as a glance at data since the mid 70s would easily confirm.
> >He has slipped into talking of wages now, instead of v, as if wages and v were
> >the same thing.
>
> For our purposes I think they (wages and variable capital) are the same
> thing if we confine ourselves to the wages of productive labor only because
> that has the capacity to be variable capital. I am repeating myself. What
> is not the same thing is v (that is variable capital) and v (the value of
> labor power).
There it is again! Well, maybe after you read what I wrote above....
> >You see now a basic problem with equating wages and v. What is this "absolute
> >limit" to the decline of v he mentions? He doesn't say.
>
> As you say the value of labor power is a social magnitude, though not
> wholly indeterminate thereby. Moreover, depression of wages below it can
> create quite real social and physical misery that provokes the revolt of
> the working class. Needs are no less so for being historical. And the ones
> that we create that lead us to struggle for a classless society are no less
> real either. Indeed it will be our creation of new needs that will commence
> the struggle for a class less society, not simply a contradiction between
> forces and relations of production that develops behind our backs.
We're back to a key point. Mattick talks about the "absolute limit" to a declining vlp. Since there is no such thing, as I explained, it's clear he is talking about wages, not the vlp. Wages do have a floor. It's the vlp!
But here you go on about what the vlp being a social magnitude means. Which has nothing to do with my point.
A conversation: you say something, I respond, then you respond to what I said, and so on.
> > Does he tell us
> >somewhere else? I don't see how he could, because v has no limit,
> >either up or
> >down. It is the socially determined reproduction cost of labor, determined
> >outside the production process, but of course affected by labor productivity.
> >As you know, for example, rising labor productivity cheapens the
> >necessities of
> >life, thus lowering v. Workers have no reason to resist this and in fact can
> >benefit from it, depending on what happens to wages.
>
> I agree with the thrust of this. The question of rendering the
> historico-moral element of the value of labor power less indeterminate is
> one of the great questions in Marxian theory, but as I have been saying,
> Paolo Giusanni has made great progress on this question.
Here was the rest of my key point. You say you agree "with the thrust of it". Hmmm. I can't possibly know what that means, since you have not reponded to any of it. As indicated by the fact that you follow with an unrelated thought of your own.
RO