[lbo-talk] law of value

[Seth Ackerman]

bhandari at berkeley.edu wrote:

>You know, Seth, though I was on OPE-L for more than ten years only to be
>either suspended or expelled, I have never met Levy, Sinha or Bendien in
>any context. So I can't answer your
>questions.
>  
>

Okay, fair enough.

>what I have been trying to underline is that capitalism creates
>contradictory tendencies.
>  
>

I always get stuck on this point. What precisely is meant by 
"contradiction" here?

As far as I can tell, to say that capitalism has "contradictions" can 
mean one of three things:

1.  Capitalism is full of logical contradictions, therefore it's can't 
possibly exist......Obviously that's not what you're saying. (This is 
Woj's point.)

2.  Capitalism is full of contraditions, therefore it's always 
presenting us with delightful and fascinating paradoxes.....I'm pretty 
sure this is not what you're saying either, since it's more of a 
humanistic or poetic interpretation of capitalism than an attempt at 
scientific analysis.

3.  Capitalism is full of contradictions in the Hegelian sense - 
tendencies which, in order to develop, must negate themselves......I 
suspect this is closer to your meaning, but I think it's deeply 
problematic. To my mind, the claim that capitalism is built on 
contradictions of this type, if it is to have any real meaning, can 
*only* mean either

(1) "therefore, there are booms and busts." In other words, it's a 
run-of-the mill business cycle theory - and not a very good one, since 
there are plenty of others far more susceptible to empirical 
verification and forecasting;

 or

(2) "capitalism must destroy itself." In other words, it's a FROP by the 
back door. But that brings us back to the empirical question. Capitalism 
has survived these supposed contradictions for 200 years without 
exhibiting any long-run tendency to wind down.

Let me try to make my point clearer. Minsky's financial instability 
hypothesis can also be read as a claim that "contradictions" lie at the 
heart of contemporary capitalism. If the Minskyians were of a more 
Hegelian bent, I suspect they would probably use the word 
"contradiction" in every other sentence. Minsky says that robust 
business expansions encourage their own self-perpetuation through the 
accumulation of financial positions that are inherently unstable and 
whose unwinding will end the business expansion. But - and here's the 
point - Minsky's theory doesn't claim to be anything more than a theory 
of the business cycle. But at least it has the virtue of being rich with 
possibilities for empirical testing, forecasting and even policy 
prescriptions. How does that compare with the "contradictions" you're 
highlighting?

Seth