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Wednesday, May 14, 2014


Well, I said our last exchange was the final one, but here we are again.   This one really is the last one.  I think I at least am finally clear where Andrew and Alan Freeman and I part company, and since it at the initial stage of basic premises, there is really nothing more to be said.

May 13, 2014

Dear Bob,

Thanks for another very quick reply.

I agree that I am focusing on the restriction you have imposed, that there is never a negative physical surplus (or negative net output) of any produced commodity, not even momentarily. And I agree that this is probably not “what separates us.” I am not focusing on the restriction in order to pinpoint or discuss what separates us. I am focusing on it in order to make clear that

(a)    the “death spiral” justification for the restriction is untenable: economies can and do physically reproduce themselves when the restriction does not hold true;

(b)   the physicalist analytical framework implies that there can be positive surplus X-value but negative profit, and vice-versa, if this restriction is not imposed; and

(c)    it follows from (b) that it has not been and cannot be proven, within the physicalist analytical framework, that exploitation of workers (positive surplus X-value) is the exclusive source of profit.

As far as I can see, your latest reply does not address any of these points. I hope we can reach agreement on them, so that we can then move on.

To explain what I think separates us, I will begin by rephrasing a passage near the end of your reply in a form that we—Alan Freeman and I, and perhaps Chris Byron as well—can accept:

Let me repeat.  I do not think that Marx contradicted himself.  Quite to the contrary, I think when we cast what we take to be his claims in the particular mathematical form that the physicalist analytical framework requires––that is, when per-unit prices and “values” of outputs are constrained to equal per-unit prices and “values” of inputs, and prices and “values” are determined wholly independently––we can demonstrate that many of them [not all, to be sure] are correct compatible with the implications of the physicalist models. The problem is, all of the same claims, without exception, are also true of compatible with the implications of the physicalist models when one replaces so-called “labor-values” with iron-values, corn-values, and so forth.

So it really does not matter to me whether you construct models with net negative output for some input, because whatever you prove thereby to be an implication of the physicalist models when the “values” are iron-values, corn-values, and so forth can be replicated for physicalist labor-values simply by adjusting the example and the notation appropriately.  Thus, the supposed contradictions between Marx’s conclusions and the implications of the physicalist models you generate can be generated as well, under the same assumptions, for physicalist labor-values.”

When recast in this neutral manner—such that it does not presuppose that Marx has been interpreted correctly or that compatibility with the physicalist analytical framework is tantamount to truth––what this passage says is basically what we said in our co-authored reply of a few days ago:

The above argument has demonstrated that, if one wishes to argue that “capital rests on the exploitation of the working class,” it is not possible do so validly by means of Wolff’s version of the physicalist model. Freeman and Kliman’s previous demonstrations have shown that it is also not possible to do so validly by means of physicalist versions of “the labor theory of value.”

The original version of your passage seems to suggest that Marx’s conclusion that surplus labor is the exclusive source of profit is simply incorrect. It’s not correct when we use corn-values, etc., but neither is it correct when we use “labor-values.” My amended version suggests something quite different, precisely because it does not presuppose that Marx has been interpreted correctly or that compatibility with the physicalist analytical framework is tantamount to truth.

If these presuppositions are incorrect, then it is possible that a non-physicalist interpretation and formalization of Marx’s arguments replicates the conclusions of his that the physicalist models cannot replicate—“under the same assumptions.” And it is further possible that this non-physicalist interpretation and formalization interprets Marx correctly. It follows that it is possible that the arguments of Marx that have been declared logically invalid (since his conclusions, it is alleged, are not deducible from his premises) are in fact logically valid.

We contend, and we think we have demonstrated beyond reasonable doubt, that these things are not only possibly true but actually true as well. This is what we contend regarding all of the alleged internal inconsistencies in the quantitative dimension of Marx’s value theory, including the inconsistency that allegedly renders untenable his own, original version of his exploitation theory of profit. Thus, as we said in our co-authored reply,

if one wishes to argue that “capital rests on the exploitation of the working class,” … there is a valid way to make such an argument––Marx’s way.

But Marx’s argument is logically valid only if it is interpreted properly, not misinterpreted in the physicalist manner. On the basis of the non-physicalist interpretation of which we are proponents, the temporal single-system interpretation of Marx’s value theory (TSSI), it does indeed follow validly that surplus labor is the exclusive source of (real) profit.[[1]] A decade of debate confirmed this result beyond reasonable doubt.[[2]]

This isn’t the place to set out the details of the TSSI or to place to reproduce all the proofs and our defenses of them, which is why I’ve included the footnotes to the passage just quoted. What I can do here is illustrate a key difference between physicalist interpretations and the TSSI. The question I will address is, “Does it matter which specific value-forming substance we ‘choose’?” We agree that it doesn’t matter within the physicalist framework. I want to show that it does matter within a non-physicalist and temporalist (i.e., dynamic) framework.

Consider a corn model in which returns to scale are constant. Corn is produced by means of seed corn and labor. Let A be the quantity of seed corn that is planted at the start of the year, L be the quantity of labor performed during the year, and X be the quantity of corn output harvested at the end of the year. Also, let Vc(s) and Vc(e) be the per-unit values of corn at the start and end of the year, respectively, and let VL be the value added by each unit of labor.

The general form of the value-determination equation is

Vc(s)A + VLL = Vc(e)X

 In the physicalist framework, the per-unit value of the output is constrained to equal the per-unit values of the seed-corn input. Thus, Vc(s) = Vc(e) = V*, and the value-determination equation becomes 

V*A + VLL = V*X

so that

V*/ VL  = L/(X – A)

This is the case whether we choose corn, or whether we choose labor, as the value-forming substance.

In a temporalist framework, there is no constraint that Vc(s) must equal Vc(e). However, if corn is the value-forming substance, then Vc(s) = 1 and Vc(e) = 1, so the value-determination equation becomes

A + VLL = X
So that

VL = (X – A)/L

and thus

                            Vc(e) /VL = L/(X – A)             (since Vc(e) = 1)

Thus, in a temporalist framework in which corn is the value-forming substance, the relative per-unit values of corn and labor are the same as those of the physicalist framework.

But what about a temporalist framework in which labor is the value-forming substance? In this case, VL = 1, so the value-determination equation becomes

Vc(s)A + L = Vc(e)X

and thus

Vc(e) /VL  =  ­(Vc(s)A + L)/X

Now, the right-hand side of this last equation does not generally equal L/(X – A). Hence, in a temporalist framework in which labor is the value-forming substance, the relative per-unit values of corn and labor are, in general, not equal to

(a)     the relative physicalist per-unit values; or 

(b)   the relative temporalist per-unit values when corn is the value-forming substance.

It follows from (a) that, if Marx did not constrain output values to equal input values, then the results of physicalist models cannot properly be assumed to be the actual implications of his theory.

It follows from (b) that the specific value-forming substance does matter within a non-physicalist and temporalist framework.

Best wishes,


[1] See Kliman (2001), chap. 10 of Kliman (2007), and Kliman and Freeman (2006, 2008, 2009).

[2] See Kliman and Freeman (2008) and Freeman and Kliman (2009).
Dear Andrew,
I am rushing to write this while preparing to leave for Seattle where, on Saturday, my wife's grandson will be bar mitzvah'd.  As I am sure you will understand, this event takes precedence over merely settling the fate of capitalism.
Let me pass over your re-writing of some of what I have written and come directly to the eight lines of equations in the second half of your message.  You introduce what you call the temporalist framework  by distinguishing between the value of a unit of corn at the start of the year [which I take it means as input] from the value of a unit of corn at the end of the year [which, again, I assume means as output.]  The key to your analysis is your insistence that corn and other commodities that are both inputs into and outputs of production may have values as inputs that differs from their values as outputs.
However, in your fourth equation, which you say represents the situation, in a temporalist framework, where corn is the "value-forming substance," there is only a term for labor [represented in the equation by the letter L], not a term for labor at the start of the year and another term for labor at the end of the year.  If there were such terms, then the temporalist framework representations of a labor-value and corn-value analysis would be identical.
But, you may object, there is no labor industry;  labor is not a produced commodity.  So the distinction between the value of labor at the start and at the end of the production process makes no sense.
And suddenly it dawned on me why we have been unable to come to an agreement.  To put it simply, you and the Sraffians agree that labor is, as economists like to say, exogenous to the system.  It is given, it is not produced.  I, on the other hand, think that the only way to capture Marx's brilliant insight into the real nature of capitalism is to treat labor as a produced commodity. 
Well, you may once more object, if labor is a produced commodity, why doesn't the labor-producing industry earn the economy-wide rate of profit?  But that is not an objection to my analysis.  It is the whole point of my analysis!  Let me explain.  As I read Capital, Marx sees capitalism as thoroughgoingly mystified, precisely in order to conceal from view the fact that it rests on exploitation.  One aspect of this mystification is capitalism's treatment of the worker. In the marketplace, that "very Eden of the rights of man," as Marx puts it with brilliant irony, the worker stands "as owner of the commodity 'labour-power' face to face with other owners of commodities, dealer against dealer."  But of course this is a delusion, a mystification, as Marx goes on to show us, for as soon as he steps into the factory he is no longer treated as the producer of commodities, but as a wage-slave, chained to the machine.
The point of my effort to model labor as a produced commodity which yet does not earn a profit when it is sold was to find some way of capturing, in the equations, the anomalous status of labor in a capitalist economy.  I freely acknowledge that  I may have failed, but that is what I was trying to do.
From my point of view, you and the Sraffians against whom you argue agree on the one premise that I reject -- you both assume that labor is exogenously given.  Thirty years ago and more, when I was working on these ideas, Sraffa and his followers were the only game in town, or so I thought [I was unaware of your work -- perhaps you had not then begun to publish it].  Consequently, I directed my arguments against their modern reformulation of Marx's critique of capitalism.  Now that we have had this interesting series of exchanges, I finally realize that you share with Sraffa the very assumption that I rejected.  Not surprisingly, therefore, I am no more able to come to an agreement with you than I was with them.
In light of this fundamental difference between us about the premises of our alternative analyses of capitalism, I do not think there is any further we can go, so I am going to call it a tie and leave the field of battle.  I wish you good fortune in your on-going struggle with the Sraffians.  Perhaps if you and I are more fortunate than we have any right to expect, there will be barricades where may meet and join forces.
All the best,


TheDudeDiogenes said...

I don't mind more discussion on Marx's Labor Theory of Value but the title made me cringe when I saw it.

Robert Paul Wolff said...

sorry about that. A phrase from my childhood.

Robert Paul Wolff said...

sorry about that. A phrase from my childhood.

Jerry Fresia said...

"The point of my effort to model labor as a produced commodity which yet does not earn a profit when it is sold was to find some way of capturing, in the equations, the anomalous status of labor in a capitalist economy. "


Sheryl Mitchell said...

Professor Wolff, this is enough. You have been VERY patient with these guys. I've been watching this exchange, and your forbearance is truly awe inspiring. I thought that between you and John Roemer the LTV had been put to rest--it must be thirty years ago now! But no, the zombies just keep coming back! (In my more paranoid moments I sometimes think that Kliman et al. are really fronts for the FBI--keeping the Left pinned down and distracted in doctrinal disputes that have nothing to do with progressive politics. But, of course, it's probably not so.) Anyway, let's get back to Piketty!

Robert Paul Wolff said...

Sheryl, as they used to say when I was a boy [but not in my home, needless to say], From your mouth to God's ear. Thank you.

Chris said...

Sheryl, I'm not sure why you implicate Kliman, Freeman, and myself, as zombies and possible FBI officials. The first article was drafted by the three of us, all subsequent articles were Kliman. Yet you write that he has been very patient with "these guys" and go on to criticize all of us. That's mean spirited.

I'm not sure how this debate between Wolff and (mostly) Kliman puts the LTV to rest though? Since Wolff readily admits in his published essay that he takes for granted that the LTV is false. But there is no actual argument as to why it is or is not false. This debate has not been about the truth of the LTV, so far as I can tell. The debate has been about rendering Marx's system tenable and consistent.

I'm not trying to rehash the debate, or start a fresh one, I'm only trying to point out that your post is...well..unnecessarily hostile, and frankly mean.

Timothy said...

Prof. Wolff's comments on this topic have been a model of civility. Chris, I have to agree with Sheryl's general sentiment ((though not her specific hyperbole) that you've been unreasonable toward Prof. Wolff and his forbearance was stupendous. Your comment, immediately on the heels of his saying he didn't fully accept the LTV, that it irritated you when ppl who reject the LTV call themselves Marxist, was just rude. Prof. Wolff's response, obliquely pointing out that Marxism doesn't need doctrinal litmus tests like religion has, was a friendly, humorous defense of himself, and showed much better cheer than mine would have.

What really showed forbearance was Prof. Wolff's response to the initial essay from Kliman, Freemen, and you, which was very patronizing and showed, as Prof. Wolff put it, a lot of irritation. And your last comment makes it clear you still don't understand Prof. Wolff's position, though I won't pursue that debate.

I'm sorry to come down on you like this, since I've lurked for awhile here and I do like you. But this discussion has subjected Prof. Wolff to extensive unfairness, and for some reason you've had blinders on regarding it.

The only other thing that I'll say bothered me in the discussion is that non-generic matrices are not *usually* a rebuttal to a general theory (unless obviously, it outright contradicts it). If the theory holds generically then it holds, since there's only a probability of 0 for it to fail - at least taking the matrix space as the sample space. I almost posted about this before, but in this case the mistake was harmless.

In any case, this exchange, starting w/ your (Prof. Wolff's) discussion of the physiocrats, has inspired me to get some textbooks about econ history (a course I skipped in college). The only heterodox theory I've had in school formally is a bit of Keynesianism. My exposure to Marxism was just through two political philosophy classes rather than econ classes.

Chris said...

To be frank, I think you're just rooting for the home team without considering the plays made.

The debate started because Wolff openly asked: why does Michael Roberts critique Piketty for conflating housing capital with other capital. I said because Roberts accepts the law of value. Wolff had specifically asked can any "real marxists" explain this? Then Wolff responded what he thinks Marx got wrong. My comment was to point out that it's odd to say one's a Marxist and yet reject the foundation upon which all of Marx's economics rests, his LTV.

Now I don't know how you're able to tell that Wolff's comments on religious doctrine are good cheer, but mine were not? Especially since that would imply that to accept the LTV one has to be pious and faithful, and that there exist no good arguments in its favor. You do realize that's a way of avoiding argument and just ridiculing the opponent right? I know that wasn't Wolff's intention, but it does imply that no rational argument exists to justify the alternative position. Wolff even retracted the claim in the debate with Kliman, which was very considerate and respectful.

I don't want to rehash the debate, but you and Sheryl are just throwing people under buses and being openly cruel without consideration of the circumstances you're talking about.

Also I do understand Wolff's position, I'd recommend reading page 98-100 of his published article though, what I said isn't false.
So, I think Wolff's a fantastic guy. I never entered the debate to upset him, and Wolff knows good and well that although we (amicably) disagree on a lot of things, as he says, we will be on the same side of the barricades. But I do think you and Sheryl aren't playing nice.

Chris said...

And since I am nice - :) - I'll let you know that Robert Heilbroner's The Worldly Philosophers, is a great place to START reading about the history of political economy. That and I.I. Rubin's history of political economy.

Heilbroner is very much aimed at all audiences. Rubin is aimed at let's graduates (in any subject).

Timothy said...

Chris, saying I've been "openly cruel" in my post is just unbelievable. Well, we can agree it's unusual to say one's a Marxist while not accepting the LTV. But Wolff was saying that Marxism is *not* a religion, not that it was (or that you said it was), and so pointing out that then there's no need for litmus tests. We agree it was hugely amiable of Prof. Wolff to withdraw the comment.

In any case, this is my last comment on tone. Your response was very surprising as the matter is very clear-cut. Cheers.

Chris said...

I specified that the cruel comment was in conjunction with Sheryl's - openly cruel - remarks that everyone involved in the debate (on our side) - was a zombie and a possible FBI stooge. And then you followed that with "i have to agree with Sheryl's general statements", instead of any attempt at a counter response to her invective post.

So, no you're not cruel as a stand alone, but the conjunction of posts was certainly more invective than anything Kliman, Alan, or myself wrote.

decessero said...

Now now boys. Enough of that. Once you are over seven years of age It isn't about who has the last word but rather who has the best one. That portion will remain hotly contested as all things Marx are imbued with a fervor not unlike... yes... religion. (Oh the irony of it all!) When it comes to tone, Professor Wolff's (not "Wolff" - he is worthy of his honorific, no?) is head and shoulder above the rest of you - articulate and elegant. Now stop bickering and go back to being the fine people you are

escaiguolquer said...

First of all, i hope you all could forgive my terrible english and, more important, that i could get myself understood.
I'd like to make some remarks on this key matter, but i don't want in any way to make anybody to feel bothered. Specially for those 'in my same side of barricades', which i think is the case of everybody in this debate, including blog comments.
Professor, i agree with you in that the root of the disagreement is about the nature of labour, and its role in capitalism, indeed, in any commodity social mode of production. You say:
"To put it simply, you and the Sraffians agree that labor is, as economists like to say, exogenous to the system. It is given, it is not produced. I, on the other hand, think that the only way to capture Marx's brilliant insight into the real nature of capitalism is to treat labor as a produced commodity"
That way of treating labour, not only is incompatible with Marx. Worse, there is no way for labour to be conceived as a 'produced commodity', because it can't be a commodity. In fact, capitalism is featured by the existence of wage labour, as opposed to serf or slave labour. But even if labour was performed by slaves, it wouldn't be labour which was a commodity, but labour-power (Though in empiric history of slavery, production of slaves always has had little presence compared to the plain kidnapping of free people to make a commodity out of them).
Anyway, i don't mean that foundation of the essence of the special status of labour in society (i.e. economics) is an easy matter. I suspect that it has much to do with the fact that is a human activity, and society is a homocentrism issue (in fact, it's not strange that i can be absolutely confident about the fact that it will be a human being that who is reading this, as well as you can be absolutely sure that the writer of this lines has been a person, and we don't need to have special powers to guess. Isn't this the roots of humanism?). I have to leave the way to the philosophers on this matter.
Then, the matter has been, from the beginning, if physicalism is compatible with Marx's version of Labour Theory of Value (MLVT, if you want to put it so), which in turn is the foundation of scientific socialism, which in turn is the bare bone of Marx works. I think that TSSI has proved (too many times, indeed) that it's not. If anybody doesn't like the ways in that proponents of TSSI do their (excellent) work in achieving that, it's a pity. It could be boring, or uninteresting, or upsetting. But the work has been done, and it can't be claimed that MLVT admits ANY physicalist formulation.
(it'll cont.)

escaiguolquer said...

That doesn't mean that physicalism was a criminal attitude, or that it can't be hold in any desired way (this, by the way, is what has been hold against TSSI sometimes). Anyone can declare herself physicalist. The point is that, then, she can't be simultaneously marxist.
And that finally gets us to the important thing, already raised in the comments of this post: so what? is there any strategical, tactical, or any species of consequences? There are. And are of the greatest importance.
Being or not being marxist: that's NOT the question. Marx himself declared that he surely wasn't a marxist, if you have to grasp with what 'marxists' say. The question is instead that, for many people marxism has been and still is the best tool for a insightful and revolutionary understanding of capitalism. In fact, it has been so not only for people interested in social revolution, but also for those afraid of it. And for these latter, including P.A.Samuelson or Bortkiewitz, distorting marx's scientific socialism is a powerful way of disactivating it. Many other people with a true interest in the working class struggle has been told that a distorted version of Marx was Marx itself, but it is not. And this could be innocuous, were it not that we loose the tool, and also the flag, to the working class avoiding the decoy of different apologists of capitalism, were they conservatives or reformist progressives. I think that some loose commentaries on this and precedent posts prove what i say.
Anybody has the right to think in the way they want. But also we marxists have the right to reclaim that marxism hold (and try to prove) that value is created only by labour, and that profits flow from and is made of surplus labour, and that this results in that profit rate has a long run tendency to fall, that crisis are necessary and unavoidable, that unemployment is a feature and a natural result of capitalism, that we can't get ride of periodical surpluses of commodities, whilst there are human needs not yet met, and the coincidence of misery in front of the greatest wealthiness is not a product of mistakes or evil, but a natural and necessary result of our social mode of production.
Without MLVT (for example, with physicalist modes of understand the capitalism) all that doesn't necessary hold, and you can always find a way to deviate working class from its interest and from its revolution.
To that extent the issue matters.