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Re: [ox-en] Re: Role of markets

Hi Paul,

I've replied to individual statements below, which makes my reply rather bitty, but I hope there is a visible theme.. (also apologies to list-members for such a marx-heavy discussion...)

Paul Cockshott wrote:

The idea of labour being the measure of value has a long pedigree, going
back to classical political economy, and there is now a large body
of econometric literature which indicates that exchange value in
a capitalist economy does correlate very closely with labour values.
Studies typically get correlation coefficients of above 95% between labour content and exchange value of commodity types.

I have no problem with those statements.

Smith explained why this is when he said that labour was the original
currency with which we purchase our wants and necessities from nature.

I assume you yourself do not believe this, or labour value would be found in all societies

The idea of labour being the basis of distribution is classic communism,
originating with Owen, and being elaborated by Marx in the Critique of
the Gotha programme.

'elaborated' as in 'replaced': 'from each according to his abilities, to each according to his needs'. That is precisely not distribution based on labour time.

The common response to this argument would be "that is the second stage, preceded by a long period of 'to each according to his work'" But we have a long period of history of the previously existing socialist states to show that 'to each according to his work' - measure by labour time - never showed the slightest tendency to evolve into 'to each according to his needs'.

It sounds like you believe it is simply not possible to have a society based on this principle, or that like the old Soviets, it is to be postponed to a distant non-time in the future when all people are saints.

Its objective is to eliminate the exploitation
of worker by employer not to solve ecological problems.

I think Marx would have been horrified by such a narrow description. The end of class-based societies is the chance for a real human history to begin, a history where people can make conscious decisions about the truly important problems instead of having them decided by the movements of share prices. Ecological problems are an example of the kind of issue that simply cannot be decided sensibly within a capitalist system, but which we might have a chance to fix in a non-labour-time based society.

A secondary justification given by Marx, is that calculation of
costs in labour rather than as wage costs accelerates technical progress.
Since wages represent only part of the labour expended, capitalism
impedes technical progress, only employing machinery if it saves wages
rather than saves labour. The cut off point for capitalist investment
in labour saving machinery is about half what it should be, as wages
are typically only about 50% of labour performed.

This is secondary to my main argument, but IIRC in the socialist countries this was one of the arguments against using labour value: attempts to use labour value would lead to lack of investment in labour-saving equipment as managers tried to maximise rather than minimize the labour value of their output to improve their apparent performance. Measurement in terms of goods produced (tons of steel, rather than man-hours of steel-workers) was supposed to avoid this (sorry if I've got that wrong, I know this is your specialty not mine).

You are right that ecological problems can not be solved by the minimisation
or maximisation of any single scalar quantity. The idea of minimising
labour input is to increase leisure and to achieve the best output for
the minimum effort.

This sparks a lot of questions:

- Suppose I want to achieve the best output for the maximum enjoyment of my work, instead? (this would be the William Morris variant of Marxism)

- Suppose I want to use my leisure productively, does my output get included in the calculations? (the free software problem, continued below)

- What is the size of the overhead used in checking on how many hours everyone is working?

- The classic argument against communism (in my sense) is 'who will collect the rubbish'? Your system will try to automate the collection as much as possible. Minimization of a scalar will never come up with a different idea, or allow for people's own initiative in finding different methods. Hill-climbing as a method doesn't allow for deliberate changes in the landscape.. 'Best output' is only best for the particular configuration you start with.

Ecology can not be dealt with using cost calculation -- ie, calculation
in money or time. Ecological constraints are not a scalar.

Exactly, just as human life isn't. Reduction of human life to the scalar time is the fundamental problem of the current system.

However it is possible in a planned economy to enter ecological constraints
as a set of additional linear constraints, and then solve the plan using
some form of linear programming using simplex or interior point methods.
If one were just going to solve for labour values one  has only a system
of linear equations rather than a system of linear inequalities. However
the complexity of planning in both cases is quite tractable to modern
computer technology.

I have a tutorial paper showing how you can use Kantorovich's method to solve
for environmental constraints in energy production on my web page

If I'm right about which paper you mean (standalone.dvi ?) it shows an example of such a solution concluding "the whole calculation can be done in PHYSICAL UNITS [my caps] without recourse to money or prices". No requirement for any use of labour values, then. But also no relative weighting in importance against labour values. So presumably the fundamental decisions are made using labour values, and as an afterthought people can then tinker with the results according to the ecological constraints. This sounds remarkably like the current system.

I notice also that this article (page 29) confirms that firms in the old USSR tended to try to maximize, not minimize, the labour value of their output.

It also doesn't help in trying to analyze free software and similar production, or in working out how to generalize it - one thing I'm quite sure of is that as soon as you try to measure the labour time used in communal free software production (the Stefans' 'triply free production'), that production stops dead.


The labour used in communal free software is part of the social surplus
labour. It is only possible for it to be produced insofar as there are
people who are either able to put time into it because they are
in an academic environment where they have surplus paid time, or
because the advance of technology has reduced the working week
sufficiently that people have time after paid work to do it.

There has been unpaid, voluntary communal labour in all societies.
Its existence in no way depends on technology decreasing working hours, unless you take the hours of a nineteenth century millworker as your base for normal human working hours. Almost everyone else before and after has had time to have a social life, which pretty much automatically includes some communal labour. That my example is specifically software of course depends on technology, but that's because I chose a modern example..

Anyway, I'm unfamiliar with the term 'social surplus labour'. If it is substantial in relation to 'official' labour, how do you take it into account in planning? Is it also measurable in labour-hours? Where are its boundaries (teaching my children to read? Helping my elderly next-door neighbour? reading about a subject useful for my job? gardening?).

As I said in an earlier post, goods whose marginal costs of reproduction
tends to zero fall into one of the categories for which even indicative
markets are not appropriate.

The question of markets is a bit separate from the question of use of labour values in planning though. How does labour-value based planning of production relate to production of goods with low marginal cost of reproduction, especially in an environment where people are also creating those goods for pleasure? I would suspect the labour-time approach can't say anything useful about it at all.


I specified that I thought that the role of a consumer goods market was limited to
those goods whose labour of reproduction remained considerable, and for which no objective assesment of need can be arrived at.

Where either of these criteria are absent, a market is not appropriate.
Information goods -- scientific laws, mathematical theorems, software,
electronic copies of music, etc should be distributed freely.
Goods that require substantial labour input but for which need can
be objectively assesed, should be free but not ad libitum, distribution
has to be rationed on the basis of need: examples would be surgery,
speech therapy, communal childcare etc.

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