Zulu
16th January 2013, 09:00
In continuation of my somewhat provocative assertion from another thread, which I don't want to derail any further, I'm putting out here excerpts from a paper I've read recently:
The position of Marx and Engels on distribution turns out in significant respects to be akin to that of the classical liberal economists Hayek and Mises. Of course, Marx predicted the collapse of capitalism and championed arrangements involving inter alia the abolition of money; I am not obviously identifying Marx with Mises and Hayek, only pointing to certain specific parallels reflecting the common ground that the capitalist system should not be tampered with, albeit for very different reasons.
Consider the incessant rejection by Engels and Marx of approaches to distribution under capitalism based on moral criteria relating to fairness. Such criteria are represented as short-sighted prejudice deriving from the competitive experience having no absolute justification. This was Friedrich von Hayeks position too...
I turn now to the binary approach to systems that emerges both in Engels and Marx and in Mises their insistence on pure communism and pure capitalism respectively the common position that there is no half-way house between fully-fledged capitalism and central control.
As for Marx an excellent instance of his concerns in this regard is provided by a letter of 1859 objecting to the "Proudhonist socialism now FASHIONABLE in France" that it "wants to retain private production while organising the exchange of private products, to have commodities but not money... ...Communism must above all rid itself of this "false brother""
This denial of a stable middle solution between systems is held in common with Marx and Engels with this difference, that Mises' concern was the fragility of capitalism and that of Marx and Engels the fragility of communism. Nonetheless, Marx's technical analysis of the control of bread prices is wholly in line with that of Mises.
Of particular significance for our present theme relating to "unexpected parallels" is Engels' insistance on the coordination function of markets in his criticism of Rodbertus' labour money, of which Hutchison has said without exaggeration that "Mises and Hayek could hardly have made the point more forcefully". And finally, note should here also be taken of an important observation by Vaughn regarding Hayek's emphasis on the limits of human knowledge in his technical essays on socialist planning:
Hayek was challenging not only the economics of central planning, but a particular way of conceptualizing economic theory. Economic planning requires not only the centralization of knowledge, but also the ability to identify what knowledge is worth centralizing. Yet Hayek believed that most economically useful knowledge is local, detailed, implicit and changeable. What kind of political economy indeed what kind of economic theory is relevant when economic actors possess knowledge like that?
It is precisely this perspective on "local, detailed, implicit and changeable" knowledge that in part determined Marx's rejection of rent-confiscation schemes the State did not have such knowledge.
www.gmu.edu/rae/archives/VOL17_1_2004/1_hollander.pdf
I would also like to quote Marx himself:
The banking system shows, furthermore, by substituting various forms of circulating credit in place of money, that money is in reality nothing but a particular expression of the social character of labour and its products, which, however, as antithetical to the basis of private production, must always appear in the last analysis as a thing, a special commodity, alongside other commodities.
Finally, there is no doubt that the credit system will serve as a powerful lever during the transition from the capitalist mode of production to the mode of production of associated labour; but only as one element in connection with other great organic revolutions of the mode of production itself. On the other hand, the illusions concerning the miraculous power of the credit and banking system, in the socialist sense, arise from a complete lack of familiarity with the capitalist mode of production and the credit system as one of its forms. As soon as the means of production cease being transformed into capital (which also includes the abolition of private property in land), credit as such no longer has any meaning. This, incidentally, was even understood by the followers of Saint-Simon. On the other hand, as long as the capitalist mode of production continues to exist, interest-bearing capital, as one of its forms, also continues to exist and constitutes in fact the basis of its credit system. Only that sensational writer, Proudhon, who wanted to perpetuate commodity-production and abolish money, was capable of dreaming up the monstrous credit gratuit, the ostensible realization of the pious wish of the petty-bourgeois estate.
http://www.marxists.org/archive/marx/works/1894-c3/ch36.htm
Soooo...
The money no longer appears as a thing (that is, the money - as Marx understood them - has been abolished), and a system of free credit (fiat currency made out of thin air (http://www.gonzotimes.com/2012/06/fiat-currency-no-more-money-than-a-theatre-ticket-is/)) guides social distribution of commodities, which are still to a large extent privately produced. Of course, in practice there is not even a hint that this distribution may become more equalized someday, but still, the "monstrous" Proudhonist system seems to have been established...
The position of Marx and Engels on distribution turns out in significant respects to be akin to that of the classical liberal economists Hayek and Mises. Of course, Marx predicted the collapse of capitalism and championed arrangements involving inter alia the abolition of money; I am not obviously identifying Marx with Mises and Hayek, only pointing to certain specific parallels reflecting the common ground that the capitalist system should not be tampered with, albeit for very different reasons.
Consider the incessant rejection by Engels and Marx of approaches to distribution under capitalism based on moral criteria relating to fairness. Such criteria are represented as short-sighted prejudice deriving from the competitive experience having no absolute justification. This was Friedrich von Hayeks position too...
I turn now to the binary approach to systems that emerges both in Engels and Marx and in Mises their insistence on pure communism and pure capitalism respectively the common position that there is no half-way house between fully-fledged capitalism and central control.
As for Marx an excellent instance of his concerns in this regard is provided by a letter of 1859 objecting to the "Proudhonist socialism now FASHIONABLE in France" that it "wants to retain private production while organising the exchange of private products, to have commodities but not money... ...Communism must above all rid itself of this "false brother""
This denial of a stable middle solution between systems is held in common with Marx and Engels with this difference, that Mises' concern was the fragility of capitalism and that of Marx and Engels the fragility of communism. Nonetheless, Marx's technical analysis of the control of bread prices is wholly in line with that of Mises.
Of particular significance for our present theme relating to "unexpected parallels" is Engels' insistance on the coordination function of markets in his criticism of Rodbertus' labour money, of which Hutchison has said without exaggeration that "Mises and Hayek could hardly have made the point more forcefully". And finally, note should here also be taken of an important observation by Vaughn regarding Hayek's emphasis on the limits of human knowledge in his technical essays on socialist planning:
Hayek was challenging not only the economics of central planning, but a particular way of conceptualizing economic theory. Economic planning requires not only the centralization of knowledge, but also the ability to identify what knowledge is worth centralizing. Yet Hayek believed that most economically useful knowledge is local, detailed, implicit and changeable. What kind of political economy indeed what kind of economic theory is relevant when economic actors possess knowledge like that?
It is precisely this perspective on "local, detailed, implicit and changeable" knowledge that in part determined Marx's rejection of rent-confiscation schemes the State did not have such knowledge.
www.gmu.edu/rae/archives/VOL17_1_2004/1_hollander.pdf
I would also like to quote Marx himself:
The banking system shows, furthermore, by substituting various forms of circulating credit in place of money, that money is in reality nothing but a particular expression of the social character of labour and its products, which, however, as antithetical to the basis of private production, must always appear in the last analysis as a thing, a special commodity, alongside other commodities.
Finally, there is no doubt that the credit system will serve as a powerful lever during the transition from the capitalist mode of production to the mode of production of associated labour; but only as one element in connection with other great organic revolutions of the mode of production itself. On the other hand, the illusions concerning the miraculous power of the credit and banking system, in the socialist sense, arise from a complete lack of familiarity with the capitalist mode of production and the credit system as one of its forms. As soon as the means of production cease being transformed into capital (which also includes the abolition of private property in land), credit as such no longer has any meaning. This, incidentally, was even understood by the followers of Saint-Simon. On the other hand, as long as the capitalist mode of production continues to exist, interest-bearing capital, as one of its forms, also continues to exist and constitutes in fact the basis of its credit system. Only that sensational writer, Proudhon, who wanted to perpetuate commodity-production and abolish money, was capable of dreaming up the monstrous credit gratuit, the ostensible realization of the pious wish of the petty-bourgeois estate.
http://www.marxists.org/archive/marx/works/1894-c3/ch36.htm
Soooo...
The money no longer appears as a thing (that is, the money - as Marx understood them - has been abolished), and a system of free credit (fiat currency made out of thin air (http://www.gonzotimes.com/2012/06/fiat-currency-no-more-money-than-a-theatre-ticket-is/)) guides social distribution of commodities, which are still to a large extent privately produced. Of course, in practice there is not even a hint that this distribution may become more equalized someday, but still, the "monstrous" Proudhonist system seems to have been established...