In relation to the previous post, which considered the idea of labor as the sole creator of value, a reader provided a link to an interesting lecture by Steve Keen. Although I had not seen the lecture prior to posting, broadly speaking I have been aware of Keen’s developing perspective on Marx’s theory of value since reading the first edition of Debunking Economics and have followed his work with interest since then. Although it may not have been evident to most readers, partly I had Keen’s critique in mind when writing the post. It seems to me that his analysis highlights a need for those of us who defend Marx’s theory to explain why it is correct to consider labor the sole creator of value. In entertaining one possible rationale, the previous post was not intended as a proof of anything. Otherwise, I would have titled it a proof rather than a musing. But now it might be worth backtracking a little to provide some background on the rationale for that post.
I am pondering the legitimacy or otherwise of Marx’s claim that labor is the sole source of value in capitalist commodity production. It is not clear that such a claim can be proved. Sometimes it is simply presented as an assumption. Other times various motivations or intuitions are offered. Here are some thoughts of that nature.
When it comes to the means of production, society can be considered as falling into two basic groups – ‘owners’ and ‘non-owners’. Acceptance of a tax-driven currency can be achieved through the exertion of pressure on one or other of these groups, or both. In a low-tech, labor-intensive economy, the state essentially compels non-owners to supply labor services to owners. In a high-tech, capital-intensive economy, there is less need for such compulsion. It will become increasingly viable to place the initiative on owners to supply final output in exchange for the currency as technology continues to advance.
In the previous post, we encountered the views of a small subset of Internet Marxists who appear to adhere to a rather hard-line, Chicago-like neoclassical understanding of the capacities of the state. There is another small subset, the Austrian Metalist Internet Marxists (or Austrian Marxists, for short), who appear to believe that a state currency not “backed” by gold must surely have zero value or, at the very least, command a level of acceptance likely to crumble at any moment. In reality, the choice between a gold standard and fiat money changes little of significance when it comes to the value of the currency or its acceptance, although it does of course affect the policy space a state leaves open to itself for as long as the currency arrangement remains in place.
There appears to be a small subset of Internet Marxists – emphasis on the words small subset – who embrace Neoclassical or Austrian ideas. Take, for instance, the Freshwater Say’s Law Internet Marxists, who maintain that the state is powerless to do anything to alter the level of capitalist production and employment. In the end, the state will supposedly drag down capitalists under the weight of its own “unproductive” activity or bring on a Fiscal Crisis of the State. This will be the day on which the issuer of the currency somehow runs out of its own currency.