Re: Economics of commodities

[Jurriaan Bendien <bendien@xxxxxxxxxxxx>]

As usual, I agree with Jim's comments, except that I would add that Capital
Volume 2 may sometimes also have relevance for research into specific
primary products, insofar as the production of just one or two products may
constitute an economic sector which link to other economics sectors. When I
studied the New Zealand economy in the later 1980s, I had a look at e.g. the
production of agrarian products, which starts on the farms, then the
processing industries, and then distribution and export. With the aid of
input-output tables and various others data sources, you could actually
develop a better understanding of the generation and distribution of new and
transferred income in these sectors.

Successive governments bought the farm vote with agricultural subsidies,
which aimed at increasing output to solve the "terms of trade" problem, or
to cope with negative fluctuations in world market prices for farm products
(for example, sometimes the state would buy wool when prices were low, and
store it until prices recovered). But in fact not infrequently these state
subsidies had quite different effects than the ones intended, which at the
time I considered an important argument for the public ownership of farms
and a social re-organisation. In fact, what happened since 1984 was that
farm subsidies were reduced to near-zero (as you can easily verify from the
NZ national accounts data), forcing a portion of farmers off the land, and
with the liberalisation of the capital market, many farms were bought up by
agribusiness, finance companies and foreign owners, leading to the decline
of the family-owned and operated farm, and the rise of the "farm manager".
Whereas the rural population was in the vicinity of 10 percent or so of the
population, in fact this economic sector was vital to the export industry,
and New Zealand is more dependent on exports than most other OECD countries.

In most of Marx's Capital, abstraction is made from specific use-values
(except for mainly illustrative purposes here and there) because Marx
focuses on the social and economic conditions for the private accumulation
of capital, when the entire production process of an economic community
becomes subject to trade relations. Nevertheless, use-values have an
extremely important role to play in political economy, as the Ukrainian
Marxist Roman Rosdolsky emphasises in the first chapter of his book "The
Making of Marx's Capital". Indeed Marx's story could be expanded, because an
aspect of commodity fetishism and commoditisation is that, sociologically
speaking, people actually view objects more and more in terms of their
functional "use-value", i.e how an object might be appropriated and used,
and if an object has no apparent use to them, they don't attribute any
(social) value to it either, a fact of considerable cultural significance.
Thus, similarly, you could argue that the ideology of "marginal utility" is
to a certain extent a direct consequence of the development of capitalism
and the resulting reification of economic relations (obviously class
conflict also creates an ideological need to deny that any exploitation of
labour occurs).

I had a debate on OPE-L about this once with Jerry, who, as I recall, argued
doctrinally and dogmatically that use-values had no real role to play in
Marxian political economy, and that the "nasty capitalists" were just
indifferent to the specific use-values produced, what mattered to them was
only the surplus-value they generated, and that Marx had said so, and
therefore that is how it really is. I replied to Jerry's argument that this
showed an extremely poor understanding of real capitalist behaviour, for the
simple reason that, in order to obtain profits, output must be sold, and in
order to be able to sell it, capitalists could hardly be indifferent to the
specific use-values of products. Likewise, in order to produce products,
specific use-values are required as inputs (including specific forms of
labour capacity), and the capitalist could hardly be indifferent to those
either. Jerry prefers to keep the discussion to the pure forms of capital
and abstract theory, but obviously this is absolutely useless if you
actually want to understand any real economy in order to change it, and
businesspeople know very well these days what a "product chain" means (the
computer industry is a good example of that).

Jurriaan