[lbo-talk] Definition of nation (was as if on cue)

Mark Wain wtkh at comcast.net
Thu Feb 24 16:15:13 PST 2011


I think taking the CEO as an employee and as an ordinary worker that he or she supervises is not what capitalism actually works. In the early stage of capitalism, there were no CEO's. They appeared on the scene when capitalism reached its middle stage. Now it reaches its late stage when CEO's are no longer treated as ordinary workers by majority share holders or owners of enterprises. If average workers' wage level characterized by their non-owning status is compared to CEO's compensations, it is very clear that CEO's are not at the same levels as the average workers (usually at multiples of several hundreds, if not a thousand times or more, of the average worker's wage.) CEO's compensations are, therefore, incompatible with, and their status is no longer of, ordinary wage-earners.

When their stock options, share bonus, golden parachutes, etc. are considered, his social status will be as different from an average worker as the assertion that capital creates value is different from the theory of labor power creates value. No, a CEO is treated by capital, and rightfully I believe, to be part of the majority share holder's work-ownership team. A CEO shares with the capitalists the rewards of success and the losses due to bust of the same outfit while generally speaking workers do not and cannot share.

It is, on the other hand, true that both CEO's and their team leaders (or the majority share holders) work and make contributions to generating profits for themselves. They therefore create value too. But the most important difference between their work and the mass foot soldiers' are completely different not only in quantity but also in quality and in nature. First of all, they cannot generating surplus value hence there does not exist an exploitation relation among themselves. All their labor power values are more than adequately compensated by earning and since there is no surplus value involved or created in their labor power, whatever the labor they exert is equal to necessary labor ( performed for consumption by producers and their families,) i.e., the ordinary workers do not exploit the owner's team work. Workers' labor power are, however, exploited by the team because, in order to sell labor power as an ordinary commodity, they have to do extra work without compensation and that's what surplus labor comes into being. In other words, surplus labor is defined as the difference of the total living labor performed and the necessary labor, which is worth roughly $21,400 (the U.S. poverty line in 2009) per year for a family of four. If workers' average wage was below the poverty line, they would have to suffer gravely and their survival chance become questionable; their labor power would have been undersold, or the rate of exploitation would be very high. Another empirical determination of socially necessary labor is based on the minimum wage. However, it has been widely violated recently because of mass unemployment and whether it is a more accurate measure than the poverty line I'm using remains debatable.

All in all, Labor theory of Value is a superior and scientific theory of modern economics, when compared with other "theories of value". Marx said, "But in bourgeois society the commodity form of the product of labor -- or the value form of the commodity is the economic cell-form (Capital, Vol. I, p. 19)." I feel that many critics of Marx' labor theory of value should read his masterpiece not once but several times in order to see what Marx missed in his elaboration of the "cell-form". And I like to venture to say, VERY LITTLE. Almost all latter-day questions and doubts about it had been anticipated and answered correctly by Marx. A relatively unimportant portion of passé type or lapses of pen or memory could not be avoidable, of course. But those lapses can easily updated without causiing systemic overhaul.

"assertion that Marx's writings are mainly "philology" not
> empirical science - an exercise of refuting someone else's argument by
> poking holes in its logic or using it to draw opposite conclusions. As
> Ian
> said, philological can be political and I agree with it. But rhetorics is
> not empirical science."

The above assertion turns out to be more surmise than verity. Marx' labor theory of value has been verified through law of tendency of falling rate of profit, capitalist crises theory and others all based on his labor theory. If one still has doubt one may read Ernest Mandel and other economists review works to understand what's new and old pov's about the theory. The aptness of "poking holes" looks easy work but Marx was no mean economist because he completed an independent system of vast breakthroughs in economics. There had been numerous competitive systems in the 19th century but none has his depth, ingenuity, creativity and influences. One may thus reflect as to why such a "hole-poking" smattering can attract so many top rated scholars for so long. Of course, there are always those who have grown too big with time for their britches.

Mark


> [WS:] What does "socially necessary" mean and how can I determine it
> empirically?
>
> As to your claim that CEO is not an employee - I think it is sheer
> nonsense
> for anyone familiar with corporate organizational structure - but I also
> understand that you need to claim that to save your theory from empirical
> refutation. So if receiving stock as a part of compensation for one'e
> services makes someone not to be an employee, then all ESOP companies are
> run by owners, not employees, right? And how about CEOs or their
> equivalents in firms that have been nationalized, as it was the case in
> all
> x-Soviet economies.
>
> But regardless what semantic device your employ, this the "retrograde
> movement" that your "geocentric" economic theory cannot explain. How come
> that certain categories of people who were hired to work for a company,
> and
> who can be sacked from their positions by owners, are remunerated at a
> very
> different rate than other categories of workers, and receive more in terms
> of compensation and control than those who hold the ownership rights.
>
> So far your argument is that I did not read that you did, which is a
> philological argument, as Carrol aptly observed. This also is consistent
> with my earlier assertion that Marx's writings are mainly "philology" not
> empirical science - an exercise of refuting someone else's argument by
> poking holes in its logic or using it to draw opposite conclusions. As
> Ian
> said, philological can be political and I agree with it. But rhetorics is
> not empirical science.
>
> But you believe otherwise and think that ltv is not merely a 19th century
> rhetorical device but has some empirical validity - show me. Show me what
> empirical phenomena the ltv is supposed to explain or predict, show me how
> it does it, and show me that its predictions are consistent with
> observable
> facts. Please do, I am anxious to know. I am not really interested in
> mere exegesis of the holy scriptures.
>
> Wojtek
>
>
> On Wed, Feb 16, 2011 at 1:25 PM, Peter Fay <peterrfay at gmail.com> wrote:
>
>> It appears much of what is being attributed here to Marx is inaccurate,
>> and
>> therefore the many deriving declamations invalid. I would suggest
>> actually
>> reading Marx. For example, Value, Price and Profit (if not Capital
>> itself).
>>
>> Laughable accounting of impact of automation on value? On labor power's
>> contribution to value? Hardly. I count somewhere around 300 pages in
>> Vol
>> 1
>> of Capital examining precisely these issues in every possible
>> circumstance
>> and detail. If there is anything that explains exploitation to
>> production
>> workers oppressed by automation, it is the sections on automation in
>> Capital. I have found nothing that explains the variations in wages
>> better,
>> and the impact of automation on value, profit and labor better than the
>> labor theory of value. If you haven't done so, try reading it.
>>
>> On wages... the exchange value of a commodity is reflected by the
>> "socially
>> necessary" labor time required for its production. Labor power is a
>> commodity like all other commodities and obeys the same laws. There is a
>> social complement to the reproduction of labor which is reflected in its
>> exchange value - whether workers are crushed like dirt, or have a
>> somewhat
>> higher level of living, which reflects itself in a higher exchange-value
>> for
>> labor power.
>>
>> And CEOs are not employees. Can't say I've ever heard of a CEO not
>> receiving some amount of ownership in the company he/she runs, although I
>> guess this is sometimes possible. White-collar workers generally
>> contribute
>> to the production of surplus value, and insofar as this is true, cannot
>> be
>> considered any different than any other wage laborer.
>>
>> -PF
>>
>> On Wed, Feb 16, 2011 at 9:55 AM, Wojtek S <wsoko52 at gmail.com> wrote:
>>
>> > Joann: "Why should LTV explain any of the above?"
>> >
>> > [WS:] Good question. As I understand, ltv was a theoretical device to
>> > justify labor's claim to ownership of the means of production. For
>> > Marx,
>> > ownership of the means of production was the main mechanism through
>> > which
>> > labor was exploited by capital (i.e. paid by its exchange value rather
>> than
>> > the total value of the output it produced. By asserting that output is
>> > produced by labor rather than capital, the ltv provided moral
>> justification
>> > for the claim to expropriate the expropriators. Beyond that it had no
>> > value, and certainly not explanatory or predictive value one typically
>> > seeks
>> > in scientific theories.
>> >
>> > While I am very sympathetic to the proposition that capitalists should
>> > be
>> > expropriated, I also recognize that this proposition can be argued in
>> > different ways, and the ltv is not necessarily the best way. It is so,
>> > because the central claim of the ltv, that all value is produced by
>> > labor
>> > is
>> > of questionable validity, if not demonstrably false. It had some
>> semblance
>> > of validity in the times when all labor was invariably manual human
>> labor,
>> > even that involved the most sophisticated tools of the time. However,
>> this
>> > proposition is laughable today, when entire production lines are
>> automated
>> > and output their generate by far exceed the input that was needed to
>> > set
>> > them up, even if it was done by human labor.
>> >
>> > The fundamental conceptual problem that the ltv encounters is the
>> > definition
>> > of labor and attribution of output to a particular labor unit. Today's
>> > production process involves a wide range of individuals working in
>> various
>> > capacities, from assembly line operators, to designers, to IT support,
>> > to
>> > administration, and to management. All of them not only contribute
>> > something to the production process, but do so in the same relation to
>> the
>> > ownership of the means of production - as employees rather than owners.
>> > In
>> > fact, the majority of 'owners" i.e. stockholders often gets bupkes
>> > comparing
>> > to what some of the employees (CEOs) earn.
>> >
>> > This illustrates that (1) the ltv fails to explain why different labor
>> > input
>> > are remunerated at vastly different rates i.e. it fails to explain
>> > exploitation; (2) the ltv fails to accomplish what it was its main
>> original
>> > goal - namely that exploitation results from ownership of the means of
>> > production and (3) its central claim that all value is produced by
>> > human
>> > labor is either demonstrably false or it requires significant
>> > stretching
>> of
>> > the concept of labor to entail virtually any human activity, which
>> > turns
>> it
>> > to a rather uninteresting tautology that all value is produced by human
>> > activity of one sort or another.
>> >
>> > Wojtek
>> >
>> >
>> > On Wed, Feb 16, 2011 at 12:15 AM, <123hop at comcast.net> wrote:
>> >
>> > >
>> > > ----- Original Message -----
>> > > From: "Eubulides" <paraconsistent at comcast.net>
>> > >
>> > >
>> > > What are the criteria for determining that capitalism is a completed
>> > > system?
>> > >
>> > > Neither you or Joanna have produced a shard of evidence over the
>> > > years
>> > > that the so-called ltv does any explanatory work whatsoever.
>> > >
>> > > To paraphrase Hume:
>> > >
>> > > Does the ltv explain the inability of human beings to deal with
>> > > global
>> > > warming?
>> > >
>> > > Does it explain how/why one faction of the capitalists in the US want
>> > > a
>> > > strong dollar while there are PhD. economists who think the dollar
>> > > should fall?
>> > >
>> > > Does it explain why union density is falling in Germany and the US?
>> > >
>> > > Does it explain the current commodities bubble? Does it explain *any*
>> > > bubble?
>> > >
>> > > Does it explain why the USG decided to destroy Iraq?
>> > >
>> > > Does it explain why the working class in China and India are unable
>> > > to
>> > > get better wastewater treatment plants?
>> > >
>> > > If can't even help explain *any* of the above issues perhaps it
>> > > should
>> > > be consigned to the flames?
>> > >
>> > > -----------
>> > > I'm so confused. Why should LTV explain any of the above?
>> > >
>> > > Joanna
>> > > ___________________________________
>> > > http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>> > >
>> > ___________________________________
>> > http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>> >
>>
>>
>>
>> --
>> Peter Fay
>> ___________________________________
>> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>>
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