cj#605> A dialog re/Marxism & reductionism

1996-11-18

Richard Moore

(The following is the latest in an exchange with a "Karl" who has been
berating me for being insufficiently marxist.  I hope this will be of
interest to some, and sincere apologies to the rest of you.)

-rkm

________________________________________________________________
Dear Karl,

You wrote:
>No matter what, there is only so
>much total profit in existence, surplus value...

        I'm not convinced that this nineteenth-century assumption about
finiteness is a sound one.  I'm not an economist, and can't discuss this
issue "intelligently", but my intution tells me that the total amount of
surplus value increases all the time, as a result of creativity.  I'll give
an example, just to make my meaning clear, but I don't think I'm capable of
an informed debate about the matter.

        Take for example personal computers.  Their existence has brought
into being a whole new signficant portion of the economy, relating to
software, hardware, peripherals, training, service, etc. -- not to mention
the increased level of operation of all businesses that results from
widespread use of computer applications.  Thus my intuition is that the
total amount of "surplus value" in the world is not closed and finite, but
open and expanding.

        To take a completely different tack on this, consider a factory,
and assume the workers are thinking of "taking it over".  They might look
at Marx, and say "This factory produces $100 million in annual revenue.
If we take it over we can get more of the fixed/finite profit for
ourselves."  But perhaps certain key expertise (maybe marketing) is lacking
among the workers, and when they take over the factory, it goes out of
business.  Thus the amount of value can be decreased as well as increased
-- but it isn't closed/finite.

---

>...KARL: You have once again proved my point which is that profit
>maximisation us what underlines this activity. What you call the
>pursuit of growth and the increase in value has as its motive profit
>maximisation.

        If you want to be reductionist about it, you can say "everything"
results from profit maxing, or from individual greed, or from fear of
poverty, or from the motion of atoms.  I might even agree that
profit-maxing is operative behind the scenes in every economic transaction.
But so what?  The universality of profit-motive does not mean there is no
point in identifying distinctions among different kinds of profit-related
mechanisms.

        I claim there is an important distinction that occurs when
enterprises are owned by stockholders whose sole aim is for the stock value
to increase.  Even if it is true to say "profit is behind it all", I still
claim the distinction is important.  It leads to a situation where
corporations cannot content themselves with being merely productive and
profitable, but must relentlessly pursue growth itself, in the style of a
cancer.

---

        In summary, I challenge the adequacy of marxist theory, as an
analysis of capitalism.  My experience with many nineteenth-century (and
eighteenth-century) theories has been to find that they are overly
reductionist.

        The discoveries of people like Newton had led to a revolutionary
scientific attitude, that all phenomenon could be explained by simple laws.
The immense power of laws/formulas like "f=ma" seemed to magically decode
the secrets of creation, and the overall design of "God's machine" seemed
to be discoverable by mortal man.

        People made the very natural assumption that similar simple laws
could be discovered for all manner of things, from psychology, to
economics, to evolution, to sociology, etc.  But... it ain't necessarily
so.

        We now know a lot more about complex systems, indeed we now know
about "chaos theory", which demonstrates that in many cases there _can't_
be any simple law or formula to usefully predict system behavior, but that
intensive computer simulation, incorporating many diverse driving forces,
is the only way to model what's going on with any precision, and then only
for relatively short prediction horizons.

        Thus in retrospect, we can see many of the early theorists were
grasping at straws, but at the time they had a deeply-held belief that the
simple laws were there, if only they could be identified.

        So we had Adam Smith et al thinking that they had discovered
fundamental economic laws (Invisible Hand and all that) showing that
unrestricted free markets would lead to everyone's benefit.  They were
wrong -- things just aren't that simple -- although their models are useful
in understanding how certain aspects of economic activity operate, during
intervals of relative stability.

        Their oversimplified theorizing survives to this day as
neoliberalism, and has managed to become the established "consensus
understanding" of economics over the past fifteen years -- not because it
has substance or validity, but because it, as propaganda, facilitates
further power-grabbing by the corporate elite.

        Marx saw that neoliberal theory (as we now call it) was in error.
His rebuttal also took the form of "simple laws", but ones that took into
account additional factors that neoliberalism ignores.  His slightly more
complex model showed, as you stated earlier, that recessions are not
unfortunate anomolies, as the neoliberals would say, but are a systemic
part of of a better-understood capitalist system.

        Nonetheless, my suspicion is that Marx was still too reductionist,
and that a useful understanding of capitalism requires more than what Marx
and his followers have been able to give us.  Their prediction of the
natural demise of capitalism, brought on by its internal contradictions,
seems now to have about as much reality as a prediction that the Messiah is
going to soon reappear on a certain mountain top.  And certainly, any
doctrinaire marxist must explain why socialist revolutions didn't occur
among the industrial proletariat, as Marx predicted, but rather in
countries emerging from feudalism.  How long do you patch up a theory
before you decide a fresh analysis is necessary?


-rkm
________________________________________________________________



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