What's up with Eugen von Bohm-Bawerk?

[Broletariat]

I was discussing economics with someone and they redirected me to his book Karl Marx and the Close of His System, just by glancing over the author's wiki page I gather quite a bit. My trouble is I've never actually read Das Kapital, and my economic knowledge only extends as far as The Conquest of Bread and Wage, Labour, and Capital. Can anyone give me some basic pointers on countering the basic claims made in the wikipedia?

"Böhm-Bawerk argued that capitalists do not exploit their workers; they actually help employees by providing them with an income well in advance of the revenue from the goods they produced, stating "Labor cannot increase its share at the expense of capital." In particular, he argued that the Marxist theory of exploitation ignores the dimension of time in production, which he discussed in his theory of roundaboutness and that a redistribution of profits from capitalist industries will undermine the importance of the interest rate as a vital tool for monetary policy. From this criticism it follows that, according to Böhm-Bawerk, the whole value of a product is not produced by the worker, but that labour can only be paid at the present value of any foreseeable output."

And then the bit where Marx supposedly contradicts himself in volume three or something.

Thanks yo

[KC]

1. Read Hilferding's rebuttal (http://marxists.org/archive/hilferding/1904/criticism/index.htm).

2. Learn more about Marxist economics. Bohm-Bawerk's criticism gets pretty incomprehensible for someone that has only read Wage Labour & Capital. Hilferding's piece is equally complicated (and if you take his incredibly dense writing style into account - which is profoundly elegant once you get used to it but if you're not it borders on being completely unreadable) so learn more about Marxian economics before you tackle these. Moreover, critics of Marxian economics probably don't understand what either Bohm-Bawerk or Hilferding are saying as almost nobody has even read them, much less understood them. I can guarantee that any conception that they would have of Bohm-Bawerk's argument would probably be through second hand sources (i.e. Wikipedia).

3. Don't try to justify your beliefs ex post facto. This leads to dogma. The transformation problem is something that many Marxist economists take seriously, and so don't dismiss Bohm-Bawerk's criticism just because it is "anti-Marx". It is probably the most honest, indepth, academic critique of Marxian economics.

Also, as a side note, the title Karl Marx and the Close of His System was not intended by Bohm-Bawerk to be read as if he was once and for all refuting Marxian economics and closed the system himself, but rather that Volume 3 of Capital represented the "close" of Marx's system as it was Marx's final writing on the subject. Bohm-Bawerk is too much of an "academic" to engage in such polemics.

EDIT: Another interesting piece, although written in his usual mechanical and protracted style, is Bukharin's Economic Theory of the Leisure Class (http://www.marxists.org/archive/bukharin/works/1927/leisure-economics/index.htm). Whereas Hilferding's piece focuses specifically on Bohm-Bawerk's critique, Bukharin's deals with Neo-Classical (I believe Austrian at the time) criticisms of Marxian economics in general and is also a damning criticism of bourgeois economics as it is known today. There are of course other books that are just as good or better in accomplishing this task but I take particular delight in Bukharin's book as he was responding to the leading pioneers of what we know today as "economics" as they were writing; he even attended their lectures (I believe he specifically mentioned attending Bohm-Bawerk and Menger's lectures as well as others that I don't recall off the top of my head).

[BAM]

"Böhm-Bawerk argued that capitalists do not exploit their workers; they actually help employees by providing them with an income well in advance of the revenue from the goods they produced, stating "Labor cannot increase its share at the expense of capital." In particular, he argued that the Marxist theory of exploitation ignores the dimension of time in production, which he discussed in his theory of roundaboutness and that a redistribution of profits from capitalist industries will undermine the importance of the interest rate as a vital tool for monetary policy. From this criticism it follows that, according to Böhm-Bawerk, the whole value of a product is not produced by the worker, but that labour can only be paid at the present value of any foreseeable output."

Much of this is already prefigured by Marx in Capital Vol I. Bohm-Bawerk's theory of "time preference" is basically an updated version of Nassau Senior's "abstinence theory" (though Bohm-Bawerk had some disagreements with Senior) which holds that profit is the reward for capitalists delaying their own personal consumption in favour of investing.

As for capitalists not exploiting workers because they provide them with an income in advance of the sale of the products they make, the whole point of capitalist production is that the workers do not own what they produce, thus they have no stake in the sale of those commodities, so Bohm-Bawerk's argument is beside the point. Indeed, workers have no choice but to sell their labour power for any income at all, and of course for that we are meant to be grateful for whatever we get!

As for Marx neglecting "time", that is nonsense. Value is determined by socially necessary labour time. Turnover time is vital to increase surplus value over the course of a given production period. All economy is reducible to time, to paraphrase Marx.

The Austrian concept of "increased roundaboutness" is analogous to the Marxian concept of the "rising organic compositon of capital", that is production methods that are more capital-intensive (use more machinery, etc.). The difference is that the Austrians see this as justificaiton for profit accruing to the capitalist. Profit is a reward to the capitalist for advance of his capital.


And then the bit where Marx supposedly contradicts himself in volume three or something.

Ah, the old "transformation problem". For a beginner it's not really important to get bogged down with this. There's no real problem at all, just Bohm-Bawerk getting confused about Marx's method of presentation. Marx makes initial simplifying assumptions, only to later bring in further detail at a later stage. Thus, as the three volumes of Capital unfold, we get successive layers of analysis building a more complex and more complete picture of all the social relations of capitalism as a whole.

Basically, Bohm-Bawerk's complaint was that Marx said at the beginning of Capital Vol I that socially necessary labour time determines value, but then by Vol III argues that "prices of production" are determined by the "old" method of adding up costs and then putting a profit on top.

For Marx, price of production = cost price plus average rate of proift (k = c + p) or, what comes to the same thing, a sum of paid labour plus a sum of unpaid labour independent of that branch of production. It is a more developed formulation of value and was a solution to Ricardo's problem of why equal capitals of differing compositions are both equally profitable.

At the level of total social capital, via the process of exchange, the capitalist gets a return on the whole of the capital advanced, not just the surplus value he is "entitled" to from the variable capital he has employed. In this way, it can be seen that the captalist class as a whole exploits the working class.

Marx seems to accept in Vol III the traditional argument about the determination of prices and thus rejects his earlier labour theory of value. Except that he doesn't. Price =/= value. He says in Vol I how he will later explain in Vol III why this isn't the case, but Bohm-Bawerk seems not to have noticed. Marx assumes that price = value for the sake of investigating accumulation and surplus value in Vol I, while at the same time acknowledging that this was a simplifying assumption. By Vol III we see that price = value at the level of total social capital, rather than in the individual commodity. Thus Marx can then account for fluctuations in market prices as well as the formation of an average rate of profit - and from there he develops the concept of the fall in the rate of profit and crisis. The law of value asserts itself indirectly at the societal level via the movement of prices.

I wouldn't worry about this before you start on Vol I of Capital. It does require effort to read, but it's not that hard. David Harvey's video lectures (at davidharvey.org) are very helpful.


3. Don't try to justify your beliefs ex post facto. This leads to dogma. The transformation problem is something that many Marxist economists take seriously, and so don't dismiss Bohm-Bawerk's criticism just because it is "anti-Marx". It is probably the most honest, indepth, academic critique of Marxian economics.

I disagree. Bohm-Bawerk's critique is important, in that it has been so influential. However, it is rather trivial. He only asserted, but did not prove, that there was a contradiction between Vols I & III. The most indepth critiques of Marx have come from within Marxism and the Left itself. I am talking about the Ricardian economist von Bortkiewicz's "proof" of the transformation problem. This was picked up by the neo-Ricardian Sraffians and later Marxists. Also another fundamental attack on Marxism came from Japanese Marxist Nobuo Okishio, who "disproved" Marx's law of the tendency of the rate of profit to fall.

Fortunately, von Bortkeiwicz's and Okishio's theories have been debunked by Andrew Kliman, Alan Freeman and others.

[KC]

I disagree. Bohm-Bawerk's critique is important, in that it has been so influential. However, it is rather trivial. He only asserted, but did not prove, that there was a contradiction between Vols I & III. The most indepth critiques of Marx have come from within Marxism and the Left itself. I am talking about the Ricardian economist von Bortkiewicz's "proof" of the transformation problem. This was picked up by the neo-Ricardian Sraffians and later Marxists. Also another fundamental attack on Marxism came from Japanese Marxist Nobuo Okishio, who "disproved" Marx's law of the tendency of the rate of profit to fall.

I wasn't claiming that Bohm-Bawerk was correct, but rather arguing against the dogma that commonly plagues the left.


Fortunately, von Bortkeiwicz's and Okishio's theories have been debunked by Andrew Kliman, Alan Freeman and others.

Do you have any links to any of these works? I have Bortkiewicz's works but have not read any of these others.

[BAM]

Duplicate post

[BAM]

I wasn't claiming that Bohm-Bawerk was correct, but rather arguing against the dogma that commonly plagues the left

Oh I wasn't thinking you thought BB was correct! I like the Austrians somewhat, even if they are full of rubbish when it comes to Marx.


Do you have any links to any of these works? I have Bortkiewicz's works but have not read any of these others.

Look for Andrew Kliman's book Reclaiming Marx's Capital. If you type his name in on a search engine you'll find his website with lots of theoretical papers on it on both Okishio and the (non-) transformation problem.

[Zanthorus]

I like the Austrians somewhat, even if they are full of rubbish when it comes to Marx. .

Eh :confused:

[BAM]

I find them interesting. There are parallels between the Austrian School and Marxian economics. For instance, Hayek's Pure Theory of Capital contains interesting similarities with Marx's reproduction schemes from Vol II of Capital. There are plenty more areas of similarity, but it doesn't surprise me given the close intellectual development of the two schools. Bohm-Bawerk even uses phrases such as "surplus value" in The Poisitive Theory of Capital.

But whenever they start talking about Marx all they ever do is cut down straw men.

[Zanthorus]

Marx and the Austrians? Now there's an interesting link. Although it could just be that most of what I know about Austrian econ is from reading the really fucking vulgar articles on the Mises Institute site who are the crazy fringe of even their own economics school :lol:

[BAM]

Yeah the Austrian theory of the business cycle is basically one of disproportionality - the production of too much means of production. Although of course their explanation lays the blame with the state rather than the mkt.

Also, theirs is a non-equilibrium school of economics, one that is more scientific than they are given credit for.

[mikelepore]

they actually help employees by providing them with an income well in advance of the revenue from the goods they produced

This might be worth mentioning if the rate of profit were usually small, but unimportant if the rate of profit is large. Suppose the worker is paid 10 dollars to perform work on 10 dollars worth of materials, and this results in a product that the capitalist later sells for 100 dollars. How can someone say that the worker isn't robbed, just because the capitalist has to wait a year before making that sale? The time delay reduces the profitability by only a slight amount, if at all.

The time delay before the sale may actually increase profitability, since the capitalist how has additional options to consider taking, options that go along with having a stocked warehouse, such as the chance to market wholesale to retailers, something that wouldn't be practical if the policy were to sell the product immediately after it gets manufactured.

Besides, that time delay is of no consequence to the worker's situation. The worker gave up the labor power this week, and got paid this week. What would Marx's critic like to see, the worker gives up the labor power this week but then gets paid for it next year? To say that the capitalist is doing the worker a favor by paying wages immediately is a very odd viewpoint. They seem to be implying that the workers should feel grateful that the exploitation isn't even worse than it is -- how kind the employer is to pay wages at the time the service is rendered.

[BAM]

Mike -

I agree. An employer has to pay his suppliers in advance of sale and there's no complaint from Bohm-Bawerk there.

Also, a worker may have to wait a month to get paid while still incurring day to day living expenses to enable him/her to reproduce his/her labour power and to return to work in the meantime. The employee is thus in effect extending credit to the employer - without being paid any interest for it!

[REVLEFT'S BIEGGST MATSER TROL]

Does anyone have any hardish economic papers/arguments on why profit comes from exploiting labour and not time delays or capital? :blink:

[BAM]

Does anyone have any hardish economic papers/arguments on why profit comes from exploiting labour and not time delays or capital? :blink:

the onus really rests on the Austrians. They argue that a smaller amount of something is worth a larger amount of it later, that present consumption is valued higher than future consumption. This is a universal condition of humankind. A loan is an exchange of future goods for present goods: "[P]resent goods invariably possess a greater value than future goods of the same number and kind, and therefore a definite sum of present goods can, as a rule, only be purchased by a larger sum of future goods. Present goods possess an agio in future goods. This agio is interest." (Bohm-Bawerk, Capital and Interest).

In the Austrian scheme, interest is the basis for profit, as opposed to say the Marxian theory where interest is a sub-division of surplus value. Interest is a quality of time, which creates value through the interaction of subjective preferences.

The trouble is, it doesn't explain anything. First of all, it is ahistorical. Next, it rests on a mystical or magical explanation: time creates value, but where does the extra value come from? Time preference is determined by income distribution (ie those with more can wait longer). It only makes sense in a society where one class have monopolised the means of production, ie where the reward for waiting accrues to those with wealth in the first place - and it certainly does not explain how the original accumulation came about, nor how and why the tempo of economic growth changes in different times and places, except by recourse to a circular argument.

[ckaihatsu]

In particular, he argued that the Marxist theory of exploitation ignores the dimension of time in production, which he discussed in his theory of roundaboutness and that a redistribution of profits from capitalist industries will undermine the importance of the interest rate as a vital tool for monetary policy.


Here -- *real* simple.... (Hope I'm not destroying any academic cottage industry here....)

- Marxism does *not* ignore the dimension of time -- it posits a labor-supplied *perpetuation* of labor (itself), based on its own labor power, going forward.

- Saying that discontinuing the practice of profit will disrupt capitalist machinations (interest rate, monetary policy) is *** not saying much ***. The technically correct response to this statement is: "Duh!"

[ckaihatsu]

Does anyone have any hardish economic papers/arguments on why profit comes from exploiting labour


1. Since labor does not own / control the means of mass production it must deal with those who do, collectively called the bourgeois (capitalist) ruling class.

2. The bourgeois ruling class' ownership of the means of mass production, or past 'dead labor', was built up over the centuries by the products of working class efforts -- labor power.

3. Ownership and policy-influencing strata of management are *not* working class because the duties of private capital ownership are *different from* and *a surplus to* the most-immediate concerns of one's own personal physical existence.

4. So, to sum up, labor's own labor-products are taken from it in return for a wage. These labor products, as saleable commodities, are converted into quantified market-based value (cash, etc.) through their sale. The *revenue* from that sale, *beyond* the expenses of overhead (capital investment) and employees (labor costs), is *surplus*. This surplus is *entirely* (100%) expropriated by capitalist ownership as "profit", even though labor's contribution to its creation was significant, to put it lightly.

5. Being deprived of a "proportional" share of the surplus revenue -- to put it generously -- *is* *exploitation* -- a continual *robbing* of the working class of the market value of its labor.


Labor & Capital, Wages & Dividends

http://i47.tinypic.com/dzbdzq.jpg





and not time delays or capital? :blink:





To say that the capitalist is doing the worker a favor by paying wages immediately is a very odd viewpoint. They seem to be implying that the workers should feel grateful that the exploitation isn't even worse than it is -- how kind the employer is to pay wages at the time the service is rendered.





Also, a worker may have to wait a month to get paid while still incurring day to day living expenses to enable him/her to reproduce his/her labour power and to return to work in the meantime. The employee is thus in effect extending credit to the employer - without being paid any interest for it!


1.xx -- Since labor must sell its labor power over time in return for a wage, with which to participate in the exchange economy for the necessities of life, this is a *coercive situation*. There is no significant alternative *choice* over how to acquire the modern necessities of life, separate and distinct from the exchange (capitalist) economy.

5.xx -- So the *terms* of exploitation -- (the forced necessity of selling one's labor power in return for wages robbed of their resulting products' full market-priced value) -- are *financialized* by either or both sides and are *secondary*, *trivial*, to the ongoing, long-term raw exploitation (sale and supply of labor power) itself.

[BAM]

- Marxism does *not* ignore the dimension of time -- it posits a labor-supplied *perpetuation* of labor (itself), based on its own labor power, going forward.

what does that mean? :confused:


- Saying that discontinuing the practice of profit will disrupt capitalist machinations (interest rate, monetary policy) is *** not saying much ***. The technically correct response to this statement is: "Duh!"

no, the argument from the Austrians is that state interference in the market through things like redistribution and government management of the economy disrupts market processes. This is what, in their eyes, causes crises. Left to its own devices, they argue, Say's Law holds: the market will never experience a general crisis, only minor hiccups and re-adjustments.

EDIT: cross-posted with your post above

[ckaihatsu]

what does that mean? :confused:


'Perpetuation' implies 'time'.





no, the argument from the Austrians is that state interference in the market through things like redistribution and government management of the economy disrupts market processes. This is what, in their eyes, causes crises. Left to its own devices, they argue, Say's Law holds: the market will never experience a general crisis, only minor hiccups and re-adjustments.


Oh, right -- thanks.





There are parallels between the Austrian School and Marxian economics.




Bohm-Bawerk even uses phrases such as "surplus value" in The Poisitive Theory of Capital.


If the Austrians acknowledge 'surplus value' it should be a small matter to point out that the increasing organic composition of capital (increasing proportion of total capital investment as physical / financial infrastructure, instead of for wages) leads to a *lessening* of the rate of return of surplus value, or profit.

So what's "rational" about that? -- !!! Shouldn't an investor be "rewarded" with *increasing* rates of return from this supposedly hallowed system -- ? So why should even *capitalists themselves* accept this pablum -- apologetics -- instead of real results on the bottom line -- ?

And would this politics of apologetics turn down the trillions in government handouts that we've seen since '08? If so it would cease to exist as we all watched capitalism decisively collapse into a void without necessary state oversight and subsidies.

[BAM]

5. Being deprived of a "proportional" share of the surplus revenue -- to put it generously -- *is* *exploitation* -- a continual *robbing* of the working class of the market value of its labor.

Just one minor point: workers are paid *at* the market value of their labour-power. The thing is this labour is capable of producing more in marketable goods than is required for its subsistence. That is not to say there is no exploitation, rather that the exploitation, the class relations, etc., occur through "free and fair exchange" on the market. (Of course, we know that this freedom is hollow.)

Even under the perfect market conditions advocated by the Austrians and "anarcho"-capitalists, "free and fair exchange" would lead to exploitation and class divisions.


If the Austrians acknowledge 'surplus value' it should be a small matter to point out that the increasing organic composition of capital (increasing proportion of total capital investment as physical / financial infrastructure, instead of for wages) leads to a *lessening* of the rate of return of surplus value, or profit.

By "surplus value", Bohm-Bawerk meant something else, namely the increased value of present goods over future goods. As for increasing organic composition, Bohm-Bawerk uses the similar concept of roundaboutness, but in his theory it is the movement of subjective time preferences that determines the rate of interest, and thus affects profitability. The theory is also normative in that it depends on a balance between savings and investments that would see the interest rate increase if investment in more roundabout methods rose.


So what's "rational" about that? -- !!! Shouldn't an investor be "rewarded" with *increasing* rates of return from this supposedly hallowed system -- ? So why should even *capitalists themselves* accept this pablum -- apologetics -- instead of real results on the bottom line -- ?

I'm not sure what you're saying, sorry.


And would this politics of apologetics turn down the trillions in government handouts that we've seen since '08? If so it would cease to exist as we all watched capitalism decisively collapse into a void without necessary state oversight and subsidies.

The Austrians would argue that we don't have true capitalism anyway.

[Zanthorus]

The Austrians would argue that we don't have true capitalism anyway.

Actually, if I remember correctly, Mises criterion for wether or not a country was "capitalist" or "socialist" was wether or not it had a stock market (Since the stock market implies private ownership of firms).

EDIT:

Here's what I was thinking of:


Interestingly, Murray Rothbard relates an anecdote in which Ludwig von Mises made that distinction, or something very like it, explicit. He asked Mises: Given that there’s such a range of possible degrees of statism, from total statism to a totally free market, and given that no country approaches either absolute, what do you regard as the defining characteristic that divides essentially capitalist from essentially non-capitalist societies? Mises’ response: the existence of a stock market. A society with a market for capital goods is essentially capitalist.
http://c4ss.org/content/1992

[ckaihatsu]

As for increasing organic composition, Bohm-Bawerk uses the similar concept of roundaboutness, but in his theory it is the movement of subjective time preferences that determines the rate of interest, and thus affects profitability.




The theory is also normative in that it depends on a balance between savings and investments that would see the interest rate increase if investment in more roundabout methods rose.


We're seeing not only *reality-based* / *empirical* problems with this Austrian School line of theory, but also *theoretical* problems, too -- by bypassing the *labor* component altogether in favor of strictly *financial* calculations the author is leaving out the fact that the economy must continually *expand* just to cover the increasing global population and its need for wage-earning jobs -- just to "stand still" in rates of profitability. (The only escape would be to rely on *state* measures that increasingly gouge the *working* class, through a reduction in public services and/or increased taxes on their wages -- or, conversely, capital gains *tax cuts* -- and this *is* what happens in reality.)

Theoretically the pool of extant value should increase *endlessly*, according to this reasoning, but that would be impossible if *labor* wasn't allowed to freely reproduce itself in line with overall global population growth. And, checking in with reality, we see that the business cycle contributes to job *destruction*, thus *shrinking* the pool of value-creating work positions.





The Austrians would argue that we don't have true capitalism anyway.


Dismissing a particular civilizational policy *isn't* merely a *binary* formulation of yes-or-no -- *any* criticism is automatically *political* and is subject to the political spectrum of left-or-right.

So which is it: No-we-don't-have-true-capitalism-and-let's-let-the-state-collapse-with-the-very-real-possibility-that-organized-labor-will-fill-in-the-void, or no-we-don't-have-true-capitalism-and-let's-look-the-other-way-while-the-state-does-whatever-it-feels-it-needs-to-in-order-to-bolster-the-markets -- ???

[BAM]

Actually, if I remember correctly, Mises criterion for wether or not a country was "capitalist" or "socialist" was wether or not it had a stock market (Since the stock market implies private ownership of firms).

EDIT:

Here's what I was thinking of:


http://c4ss.org/content/1992

thanks I've seen that quote before, in this article from Rothbard himself http://mises.org/daily/2401

Of course, what the Austrians mean is that we have a state-sponsored, distorted capitalism, not that it's socialism. (EDIT: some of the more crazy ones do of course!)

[BAM]

We're seeing not only *reality-based* / *empirical* problems with this Austrian School line of theory, but also *theoretical* problems, too -- by bypassing the *labor* component altogether in favor of strictly *financial* calculations the author is leaving out the fact that the economy must continually *expand* just to cover the increasing global population and its need for wage-earning jobs -- just to "stand still" in rates of profitability.

The Austrians don't "bypass the labour component". They argue that workers are paid according to their marginal value product. In Bohm-Bawerk's theory specifically, workers are not entitled to the full value of the products they create because they are paid in advance of the sale of those products. But we've already seen how that theory is garbage. Under capitalism, the workers do not own the commodities they create - the capitalist does.


(The only escape would be to rely on *state* measures that increasingly gouge the *working* class, through a reduction in public services and/or increased taxes on their wages -- or, conversely, capital gains *tax cuts* -- and this *is* what happens in reality.)

Agreed. In practice capital relies on the state. It's only in the fairy-tale land of free market ideologues that a stateless capitalism is possible.


Theoretically the pool of extant value should increase *endlessly*, according to this reasoning, but that would be impossible if *labor* wasn't allowed to freely reproduce itself in line with overall global population growth. And, checking in with reality, we see that the business cycle contributes to job *destruction*, thus *shrinking* the pool of value-creating work positions.

Again, agreed. That would be the General Law of Capitalist Accumulation: the harder the workers work, the more likely they are to find themselves unemployed. The real barrier to capitalist accumulation is capital itself.


Dismissing a particular civilizational policy *isn't* merely a *binary* formulation of yes-or-no -- *any* criticism is automatically *political* and is subject to the political spectrum of left-or-right.

So which is it: No-we-don't-have-true-capitalism-and-let's-let-the-state-collapse-with-the-very-real-possibility-that-organized-labor-will-fill-in-the-void, or no-we-don't-have-true-capitalism-and-let's-look-the-other-way-while-the-state-does-whatever-it-feels-it-needs-to-in-order-to-bolster-the-markets -- ???

Whoa! Too many hyphens!

[ckaihatsu]

The Austrians don't "bypass the labour component". They argue that workers are paid according to their marginal value product. In Bohm-Bawerk's theory specifically, workers are not entitled to the full value of the products they create because they are paid in advance of the sale of those products. But we've already seen how that theory is garbage. Under capitalism, the workers do not own the commodities they create - the capitalist does.


Y'know, even this "Hey, it's the market, buddy" kind of explanation would be okay *if* the bourgeois state didn't use coercive physical force (and corporate-media-driven establishment politics) against organized labor. In other words it's one thing to point to the standard operating procedure -- the markets -- given the status quo, but once workers' freedoms to self-organize and control production are abridged with the use of force, then it's a class rulership based on brutality and not a market-based democracy.

[BAM]

Y'know, even this "Hey, it's the market, buddy" kind of explanation would be okay *if* the bourgeois state didn't use coercive physical force (and corporate-media-driven establishment politics) against organized labor. In other words it's one thing to point to the standard operating procedure -- the markets -- given the status quo, but once workers' freedoms to self-organize and control production are abridged with the use of force, then it's a class rulership based on brutality and not a market-based democracy.

Of course the separation of the producers from their products is ultimately based on violence. That's certainly how it came about during the period of primitive accumulation, when the peasantry were dispossessed of the land and a class of people with nothing to sell other than their labour was formed:


the accumulation of capital presupposes surplus-value; surplus-value presupposes capitalistic production; capitalistic production presupposes the pre-existence of considerable masses of capital and of labour power in the hands of producers of commodities. The whole movement, therefore, seems to turn in a vicious circle, out of which we can only get by supposing a primitive accumulation

The violence will show itself wherever workers try to organise and where that organisation is perceived as a threat to capital. But in its "normal" day-to-day functioning this violence does not show itself.

But even if you take away the violence, the market, even in its most pure and perfect form, will still produce the separation of workers from what they produce. The accumulation of capital produces not only commodities and surplus value, but also wage-labourers who need money and who are compelled to work, and at the other end of the pole, a class of capitalists.

[ckaihatsu]

But even if you take away the violence, the market, even in its most pure and perfect form, will still produce the separation of workers from what they produce. The accumulation of capital produces not only commodities and surplus value, but also wage-labourers who need money and who are compelled to work, and at the other end of the pole, a class of capitalists.


Okay, I'll take the bait here and address a "pure and perfect form" of capitalism -- but only if we can include the *labor* component as an extant *social* force, in addition to the regular financial-myopic definition of the system of capitalism.

So, according to this formulation -- *without* the reliance on legal violence -- we'd have to wonder if state-less markets would go unopposed by groupings of workers that might come together for the intentional and explicit purpose of raising *political* issues, especially about their own, work-based interests and concerns.

Again, *my* concern here is that we *not* ignore socio-political dynamics and fall into the brainwashed mentality that only recognizes *financial* components as the sum total of the system of capitalism.





The Austrians would argue that we don't have true capitalism anyway.





Dismissing a particular civilizational policy *isn't* merely a *binary* formulation of yes-or-no -- *any* criticism is automatically *political* and is subject to the political spectrum of left-or-right.

So which is it: No-we-don't-have-true-capitalism-and-let's-let-the-state-collapse-with-the-very-real-possibility-that-organized-labor-will-fill-in-the-void, or no-we-don't-have-true-capitalism-and-let's-look-the-other-way-while-the-state-does-whatever-it-feels-it-needs-to-in-order-to-bolster-the-markets -- ???

[BAM]

Okay, I'll take the bait here and address a "pure and perfect form" of capitalism -- but only if we can include the *labor* component as an extant *social* force, in addition to the regular financial-myopic definition of the system of capitalism.

why is that "taking the bait"? That's Marx's method in Capital. He wants to show that even if we accept the assumptions of the political economists of pure and perfectly functioning markets, we get the accumulation of wealth at one end and the accumulation of misery at the other. So, even if we take the Austrians at their word of a harmony of interests between classes, we still get class divisions. Thus too, exploitation occurs even when labour-power is sold at its value.


So, according to this formulation -- *without* the reliance on legal violence -- we'd have to wonder if state-less markets would go unopposed by groupings of workers that might come together for the intentional and explicit purpose of raising *political* issues, especially about their own, work-based interests and concerns.

Agreed, and that's why stateless capitalism is a fantasy, but we have to show how it is, even if we take the assumptions of its proponents at their word.


Again, *my* concern here is that we *not* ignore socio-political dynamics and fall into the brainwashed mentality that only recognizes *financial* components as the sum total of the system of capitalism.

Are you saying that I am ignoring "socio-political dynamics"?

[ckaihatsu]

Are you saying that I am ignoring "socio-political dynamics"?


No, I'm saying that the "pure markets" argument is.

[GPDP]

Okay, I'll take the bait here and address a "pure and perfect form" of capitalism -- but only if we can include the *labor* component as an extant *social* force, in addition to the regular financial-myopic definition of the system of capitalism.

So, according to this formulation -- *without* the reliance on legal violence -- we'd have to wonder if state-less markets would go unopposed by groupings of workers that might come together for the intentional and explicit purpose of raising *political* issues, especially about their own, work-based interests and concerns.

Again, *my* concern here is that we *not* ignore socio-political dynamics and fall into the brainwashed mentality that only recognizes *financial* components as the sum total of the system of capitalism.

I guarantee as soon as you inject the discussion of socio-political dynamics
into an argument with an Austrian/ancap about their perfect free-market society, they will either dodge the issue or show their true authoritarian anti-worker attitudes.

Ancaps envision their utopia to be thoroughly apolitical - every decision in their fantasy land would be made through the market, after all, since they are not only anti-state, but anti-government as well. As such, the thought rarely crosses their mind that a group of people (the workers) may come to the realization that the system works far less in their interest than it does for their bosses.

If pressed on the possibility of workers organizing against the very logic that the system runs under (that of exploitation through the taking of surplus value), ancaps will invariably side with the bosses, probably dropping some spiel about such organizing violating property rights or initiating aggression, wherein they would support the suppression of worker organizations through the sta- I mean, private defense agencies.

At this point, one could easily question the hypothetical ancap stating his support for such measures as to whether their system could really be regarded as apolitical and without any form of government if the possibility is there that a group of people may resort to the suppression of another due to a clear contrast in interests. And where there is a contrast of interests, there is politics - ours and theirs. We know that political conflict as the class struggle, and in siding with the bosses, such an Austrian would be mad to deny its existence even within their perfect dreamland.