WEED WHACKING

My brief and quite obviously humorous post yesterday elicited no fewer than twenty comments, not counting my own response to one of them.  Perhaps I should say a few words by way of explanation.

In her scattershot and rather ebullient posts, Anonymous says at one point “Theory is good, beautiful, and easy. The hard part is to implement in the world a vision that both lifts the people economically and gives rise to beauty, thought, progress, knowledge, lively political conversations, freedom, and a truly better future.”  [I say “her” because I cannot tell from the post Anonymous’ gender, and the constraints of proper English require me to make some assumption.  If I am wrong he can correct me.]

I could not agree more with her sentiment, and indeed I believe I have said as much several times in this space, though perhaps not so eloquently.  Why then do I write about theory?  I might reply, as Kierkegaard did in the Preface to Philosophical Fragments:  “When Philip threatened to lay siege to the city of Corinth, and all its inhabitants hastily bestirred themselves in defense, some polishing weapons, some gathering stones, some repairing the walls, Diogenes seeing all of this hurriedly folded his mantle about him and began to roll his tub zealously back and forth through the streets.  When he was asked why he did this he replied that he wished to be busy like the rest, and rolled his tub lest he be the only idler among so many industrious citizens.”  Kierkegaard adds, “Such conduct is at any rate not sophistical, if Aristotle be right in describing sophistry as the art or making money.”

At Hampshire College in Massachusetts forty years ago or so, I gave a talk the thrust of which was that Philosophers had hitherto only interpreted the world in various ways, whereas the point was to change it [a sentiment I lifted from Marx, needless to say.]  A student raised his hand and asked, “So why then do you write books?”  My response was no more than a prosaic version of Kierkegaard’s poetic vision.  “Social change requires many people doing many different things,” I replied.  “Some people organize protests, some people raise money, some people hand out fliers, some people lock arms and sit down to block traffic.  I write books.  It is not by any stretch of the imagination the most important task, but it has some utility, and I am good at it, so that is what I do.”

Now a word about CAPITAL.  Marx, like Jesus [and equally unfairly, I might add], has been burdened with responsibility for the inhumanities perpetrated in his name.  But Marx had nothing to say about the Bolshevik Revolution, which occurred fifty years after the publication of CAPITAL, nor did he offer comments on the Chinese Peasant Revolt thirty-two years further on, or the Cuban Revolution, yet thirteen years further still.  He did, on the other hand, have an enormous amount to say about the economic theories of his European predecessors.  Indeed, if we consider Volumes One, Two, and Three, and throw in the three volumes of the THEORIES OF SURPLUS VALUE, one might reasonably conclude that he had more to say about the economic theories of his predecessors than about anything else.  Anonymous may find theory easy as well as good and beautiful, but Marx did not think so, and he devoted much of his time in CAPITAL to struggling with it.

As I see it, Marx dealt with, among others, three big theoretical issues in CAPITAL.  The first was a problem recognized by Ricardo, namely that prices are proportional to labor values only when all sectors employ equal proportions of direct and embodied labor.  Marx believed he had a solution to that problem, but surprisingly he put off stating his solution until Volume III.

The second issue, dealt with immediately in Chapter One of Volume One, was Marx’s very important recognition that it is abstract socially necessary labor and not ordinary concrete labor that is at stake when one makes claims about the relation of prices to labor values or the distinction between necessary labor and surplus labor.  Marx’s intuitions here are spot on and mathematically very sophisticated, for all that he lacked the formalism to express them precisely.

The third issue, which goes to the heart of his central theory of exploitation, was that his predecessors were unable to explain why there is any profit at all in a fully realized competitive capitalist economy.  The first six chapters of CAPITAL are devoted to generating this problem, refuting the feeble explanations of his predecessors, and then presenting his solution, which turns essentially on the distinction, introduced by Marx, between labor power and labor.

My view is that Marx’s solution to Ricardo’s problem is brilliant and almost right.  His treatment of the second issue is dead right.  And his solution to the third problem is wrong, even though Marx’s most important inference from that solution is in fact correct, namely that Capitalism rests essentially on capitalists’ exploitation of workers, regardless of how enlightened, well-meaning, and woke they are.

I shall endeavor to communicate all of that to my students.

DEEPER INTO THE WEEDS

In some religions, there is a distinction between the exoteric doctrines taught by the priests to the faithful and the esoteric doctrine reserved for the initiates.  The question posed to the priests is when, and whether, to lift the veil and allow the masses to glimpse the sacred Mysteries.

As I prepare my next lecture, I confront a version of this dilemma.  I shall, on Tuesday, rehearse Marx’s mocking debunking of the feeble and absurd explanations given by Vulgar Economists for the existence of profit in a capitalist economy [no, it is not that the entrepreneurs live frugal lives and save, nor is it that they earn the wages of management, nor do they all somehow manage to buy cheap and sell dear].  Then I shall reveal the Word, which is that profit is but the money appearance of the surplus labor extracted from the workers.  From which it follows that:

CAPITALISM RESTS ON THE EXPLOITATION OF THE WORKING CLASS.

It is a dramatic story, brilliantly told by Marx in the opening chapters of CAPITAL.  But there are secret truths, Mysteries known only to me and a tiny handful of others, truths unknown not because I have concealed them but because, alas, so few people have read the journal article in which I revealed them.

The secret truth is that Marx’s explanation of the source of profit is wrong, even though he is absolutely right that Capitalism rests on the exploitation of the Working Class.  My problem is this:  Shall I reveal this truth to my class?

Why ever not? You ask.  Considering the fortune they being charged for a Columbia education, do they not have a right to learn the Mysteries?  To be sure.  But just as the ancient Mysteries of Eleusis required fasting and mortification of the flesh, so the Mysteries of Marx require Mathematics, a mortification more painful than self-flagellation to most college students.

This dilemma has kept me up at night.

INSIDE BASEBALL

I don’t know whether anyone is interested in this, but I will post it in case someone is.  I said in class on Tuesday that Ricardo could not figure out what to do with the case in which there are unequal capital/labor ratios [unequal organic composition of capital] and Marx had an answer that almost worked.  It worked when the economy is on what is now called a Von Neumann balanced growth path.  A graduate student in the course asked me where he could find an exposition of that and I drew a blank, so I wrote him this email:

            We start with Ricardo, who spent some time analyzing an imaginary economy with only one commodity – corn is Ricardo’s choice.  If there is only one commodity, then the only inputs into production are corn and labor.  One unit of corn is taken as money, the wage is some amount of corn, and the profit rate is paid in corn units.  Not surprisingly, everything in this model is simple and unproblematic.  Prices are proportional to labor values, the total profit in the system is equal, in corn money units, to the surplus labor extracted from the labor inputs, and so forth.

            Now fast forward to Sraffa, who not only wrote the very important monograph Production of Commodities by Means of Commodities [1960] but also edited the splendid 10 volume edition of the complete works of David Ricardo.  In his monograph, Sraffa analyses an economy with nothing but “basic” commodities and no “luxury goods,” a basic commodity being defined as a commodity required directly or indirectly in every line of production, and a luxury good being defined as a commodity that is not required, directly or indirectly, in the production of all commodities.  [Mathematically, this means that the square matrix of input coefficients is a non-negative non-decomposable matrix, although Sraffa never uses that language – is this clear?]

            Sraffa defines a notional complex commodity which he calls a “standard commodity”, consisting of quantities of all the basic commodities so chosen that the balance of the components of the Standard Commodity exactly equals the proportions of basic commodities in the economy when it is balanced, so that there is no excess or shortfall of demand.  Sraffa then proves that every economy with no luxury goods but only basic commodities can, by the workings of competition with each producer seeking to maximize profits, be brought into balanced form.  Thus it can be thought of as though a quasi-one commodity economy, the commodity being that Standard Commodity.  For details, see Chapter Six of my book, Understanding Marx, especially the Technical Appendix. 

            A Balanced Growth Path is a growth path in which the excess of each commodity in one cycle, which is to say the excess over and above what is needed to run the economy for another cycle at the same level, is just enough to expand production in the next cycle with no shortfalls or excesses of inputs.  Von Neumann proved a famous theorem about capitalist economies on a Balanced Growth Path which essentially shows [he did this before Sraffa, by the way] that any capitalist economy without luxury goods has a balanced growth path in which all surplus output in one cycle is reinvested in expanding the scope of production in the next cycle.  [If you Google “Von Neumann balanced growth theorem” lots of results pop up.]

            Now, it is easy to prove that in a Sraffian Standard Commodity economy or alternatively in a Von Neumann economy on a maximal Balanced Growth path, Marx’s claim is correct that total profits are proportional to total surplus labor.  This is obvious because such an economy is in effect a one commodity economy in which the inputs and outputs consist of quantities of the Standard Commodity.

LGA BLUES

Tuesday, after my class, I spent an hour with a student.  Then, at 5 p.m., I caught the M60 bus at Broadway and 116th street for LaGuardia.  I got home and into my apartment at 12:15 that night.  Just another seven hour trip courtesy of LaGuardia and its endless delays.  I love the teaching but the commute may kill me!

WHISTLING TO KEEP MY SPIRITS UP

One of the problems I have faced in preparing my up-coming Columbia lectures is that there is simply not enough time to say everything I want to say in the three remaining seminar meetings devoted to Marx.  Obviously one solution is to refer the students to the books I have written, but I was concerned that I might scare them away from the first book, Understanding Marx, if I mentioned that it had math in it.

Well, some years ago when I was working pro bono at Bennett College, an HBCU in Greensboro, I surfed the web until I found the state-wide standards promulgated by the North Carolina State Board of Education for all public schools K-12.  There I discovered that the math I use in the body of the text of my book is required to be taught in all North Carolina schools in grade 9.

So I shall say to my Columbia students, by way of encouragement, that if they made it through the Freshman year of high school, they can handle my book.

As teachers, we do what we can.

IDLE SPECULATION ON A SLOW SUNDAY

Stymied in my lecture preparation by the fact that I have too much to say and not enough time in which to say it, I decided to relax by reminding myself of the rules governing the Iowa caucuses and by checking 538.com for the last month and half of Iowa polls.  It was as I thought.  Candidates getting less than 15% in the first round are eliminated and their supporters sort themselves, if they so choose, among the remaining possibles.  For the past six weeks, the polls indicate that only Biden, Sanders, and Warren would make it past the first round, freeing up anywhere from 45% to 28% of caucus goers to reassign themselves. Biden leads all the polls, save for one outlier, but the two crucial questions are obviously: First, which candidates can get their supporters to the caucuses? and Second, who is the second choice of those caucus goers freed up by the cut?

I think [which is to say, I hope against hope] that this is bad news for Biden.  If his current lead is more or less his ceiling, then Warren or Sanders should beat him out for the win.  Since the number of delegates at stake is tiny, what matters is the momentum and publicity of the win, not the actual group of delegates awarded.  My hope is that his huge lead among the African-American vote, based apparently on his popularity with older Black voters, will evaporate should he come out of the caucuses [and perhaps also the New Hampshire primary] a loser.

I really, really, really don’t want Biden.

IMPORTANT NEWS FLASH

The twin towers existed!  I have epistemically solid proof.  I just received this message from my son, Patrick:

"I can tell you how you can be pretty certain the Twin Towers existed. Anand played the 1995 World Championship match against Kasparov there, and I was Anand’s second, thereafter writing a book about the match. I went into one of those towers (I forget which one) many times."

Now, if my sister had only bagged a job in the West Wing ...