Discussing Marx with zloj and russiangambit
September 09, 2010
– Comments (41)
I'm very excited for this post. I've spent the last 2-3 weeks working my way through Marx's Das Kapital Volume I, along with a couple of critical works. I will get into the critical works a little later.
This is not a book review. This isn't a debate, per se, either. We are lucky to have with us two individuals that saw application (or inappropriate application) of Marxist doctrine first hand. But there's more than that. I happen to really enjoy zloj and russiangambit's writings. russiangambit doesn't blog much, but provides us with very insightful commentary on some of the most controversial topics.. zloj will always be a special adversary. We agree on so much, but on certain issues we will most likely be perpetually opposed. That, however, is made up by zloj's willingness to investigate opposing viewpoints and his very funny and insightful criticisms of both the American Left and Right. In other words, zloj always surprises me - and usually pleasantly!
I'm going to keep this initial post short. I hope you will keep up by clicking the "Follow" button as this discussion may go on for several days. I certainly welcome any participation outside of my guests, but please keep the discussion topically relevant and cordial. Thanks!
(Quick note: if I make a reference to the book, I will be usinig chapter numbers instead of page numbers. The copy I used for this post is here and does not have page numbers.)
I'm going to start this discussion with two questions (of course, you know me, I have many many more), but I'll let zloj and rg answer them and then we'll move on.
1. The major shortcoming of the classical economists was their price theory. They didn't have a satisfactory explanation of why things you don't need to survive cost so much more than things you do. If you turn to Chapter V of Adam Smith's Wealth of Nations: "Of the Real and Nominal Price of Commodities, or of Their Price in Labour, and Their Price in Money", you will find an explanation of vlaue that is a Labor Theory of Value. In other words, the value things comes from the labor the person expends in creating it.
This is a very similar theory to Marx's Transformation of Labor into Value in Chapter 19 of Das Kapital. But neither Smith nor Marx offered a satisfactory explanation as to why reality differed from their theory. For Marx, market prices are "accidental-market prices" (Chapter 19).
I think Marx was a victim of classical economists more than knew. Das Kapital was printed in 1867. In 1873, Carl Menger published Principles of Economics, which explained price formation as a subjective evaluation of the marginal utility of the next available unit (bottle water is plentiful relative to high quality diamonds, so the economic actor gains more utility by adding one diamond than by adding one bottle of water.) Marx never published a rebuttal or critique of Menger.
Did Marx or any of his adherents ever address the "marginalist revolution" - as it came to be called? Did Soviet scholars ever address subjective price formation? How did the Soviets apply the Labor Theory of Value in practice?
2. Karl Marx was no friend of The State - the corrupt governments of Europe, more precisely. Chapter 28, for example, lists some of the atrocious policies European governments employed to exploit the working class. Certainly, no libertarian can object to Marx's view that The State has used force to extract wealth from the poor for centuries. What explanation, if any, did Marx ever provide for why the forces working against those policies (laissez-faire thinkers of the period, for example the persecuted School of Salamanca, and the working class citizens) failed to stop the onslaught of exploitative legislation?
And to take it the next step further, why did Marx believe that strengthening the coercive apparatus (The State) that instituting these cruelties would lead to a "withering away" of The State.
Let the discussion begin....
David in Qatar
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