[As signalled here a few days ago, I'm now posting a first excerpt from the joint paper by Mark Harvey and me with the above title. The excerpt below comes from the opening of section I. There's a link to a full PDF version of the paper at the end of this post. I'm omitting footnotes from the excerpt here, but these are to be found in the full version. - NG.]
In the present time of financial crisis and economic downturn, there has been renewed interest in Marx's thought and much discussion of its relevance to current problems. The interest centres, for obvious reasons, on his major economic treatise, Capital. That the three volumes of this work and the related manuscripts - the Grundrisse and Theories of Surplus Value - yield insights regarding both the periodic instability of capitalist economies and the maldistribution of the burdens of economic crisis is not to be doubted. At the same time, it is hard to think of a period since Marx's death when Marxist movements and organizations in the world's wealthiest countries were weaker than they are now. More generally, the global left is not well-stocked with practical strategies - strategies for moving towards alternative forms of economy and social organization - that look like being able to persuade Western electorates.
The need for a critical renewal of Marx's materialist theoretical legacy, and for its application to contemporary societies, is as pressing as it has ever been. Everywhere the material basis of human life is called to mind: in concerns about climate change; in problems of the availability and the cost of food; in issues of land use, the control of water, and the price of oil. The materialist conception of history, as it came to be called, may sometimes have been formulated one-sidedly by Marx, Engels and the first generations of their followers, but its focus on the material infrastructure of social and political order remains indispensable both for understanding where humankind now stands and for any realistic projection of how to maintain the movement of historical progress in forms that can be defended as increasingly just.
One thing that is not helpful in this context, however, is a blank reassertion of the validity of Marx's most central economic categories for the analysis of global capitalism. Capital remains a work of fruitful - particular - explanatory hypotheses: hypotheses regarding, for example, the underlying causes of instability and crisis, the tendency towards the concentration of capital, the persistent production and reproduction of unemployment, the restlessly innovative drive transforming and retransforming technical processes of production and, more generally, social relations at large, and the globalizing dynamic as capitalist imperatives are pressed across national and regional boundaries. It contains the wherewithal for explaining why the geographical limits sometimes imagined for capitalist markets can generally be offset by the creation of fresh consumer needs through the invention of new types of product. Marx may not have anticipated the full extent of this phenomenon, but he understood its potential.
On the other hand, the value theory that is central to the architecture of Capital and to the whole of Marx's mature theoretical enterprise is not defensible. On his own account of things, Marx set out to 'reveal the economic law of motion of modern society' and yet he could not show how labour-determined values, as defined and expounded in the first volume of his major work, were translated into the mechanisms of price and exchange in actual capitalist markets. This difficulty has long been known about under the name of the 'transformation problem'. We mention the latter here only in passing, since it is our contention that the weaknesses of Marxian value theory are more fundamental and incapacitating than are captured by the statement of that problem. Still, the labour-value-price nexus within Marxian theory remains the site of a key difficulty for those who continue to affirm the validity of Marx's central categories, and yet it is a difficulty all too often left unaddressed by them.
We will cite as exemplifying this omission recent books by three veteran Marxists: Terry Eagleton, Frederic Jameson and David Harvey. These are writers of varied intellectual styles; they address their readers in different tones and idioms. We draw attention only to the common feature uniting them (apart, that is, from their being all writers of established reputation within the stream of contemporary Marxist thought). That common feature is that all three write as if the explanatory success of Marx's theory of value for understanding capitalism needs no defence; as if it can just be taken for granted.
The book by Terry Eagleton to be discussed here bears a title of rebarbatively totalizing implication: Why Marx Was Right. Despite the title, Eagleton does not in fact claim that Marx never went wrong. He allows in the book's preface, as well as signalling here and there throughout, areas of doubt about or disagreement with Marx's ideas. Eagleton's purpose is no more, he says, than to take ten of the most standard criticisms of Marx and to try to refute them. Nowhere in this exercise, however, does Marxian value theory put in an appearance for analytical appraisal. Of course, Eagleton is not a political economist, and it may be thought acceptable for him to choose his themes according to what he knows most surely. Yet it is clear that he regards Marx as having provided, all in all, the best intellectual starting point for understanding modern capitalism, and it is hard to understand how this claim can be sustained without any defence of Marxian value theory. Sparing himself the effort of such a defence, Eagleton nonetheless lets slip that, as far as he is concerned, Marx's concept of value may be taken as being valid. For, as he writes in the preface already mentioned, 'Marx was the first... to show how it [capitalism] arose, by what laws it worked, and how it might be brought to an end' (emphasis ours). The verb 'to show' is factive: Eagleton's contention, therefore, is not one about what Marx merely set out, or hoped, to do; it is a claim about what he putatively achieved. But that claim cannot be rationally defended except by a defence of the central notion with which Marx undertook to explain 'by what laws' capitalism worked. So there is a hole at the very heart of Eagleton's book, purporting as it does to convince its readers why Marx was (mostly) right, but without any attempt to vindicate by argument the most pivotal concepts relied on by Marx in his presentation of capitalism.
That book does at least have the merit of being written in a language which is clear and easy to comprehend. The same cannot be said of Frederic Jameson's Representing Capital: A Commentary on Volume One. This is a commentary many readers will find impenetrably obscure and written as if addressed to a circle of initiates in some arcane cult. One of the few points it does register clearly, all the same, is the one we have identified in Eagleton: namely, that Marx exposed the inner laws governing the operation of capitalism. Jameson is explicit about what stands at the centre of these laws. '[T]he theory of value', he writes, '... secures the existence, behind all appearances of price and market exchange, of those deeper laws which it is the vocation of Marxian theory to bring to light'. The vocation of Marxian theory - but does Marxian theory succeed in this vocation? One must make one's way through more than a hundred pages of further abstruse commentary before discovering that the author will simply dodge the question. It is not his purpose, Jameson says, 'to defend the "truth" of Capital from its anti-Marxist enemies'. (He betrays there, incidentally, a certain supposition about the qualifications he requires for inclusion of others within the Marxist fold.) It is not his purpose to do that, because Capital's critics, Jameson declares, subscribe to a reflection theory of truth, whereas the work 'stands or falls as the representation of a system'. That is it, all of it: the author's entire attempt to deal with the issue of validating Marx's most fundamental concept, a concept that according to his belief secures the existence of capitalism's deeper laws. He brushes aside the issue with no more than a glancing reference to clashing epistemological assumptions.
Finally, David Harvey who, like Eagleton and unlike Jameson, respects some norms of clarity of exposition, is similarly evasive. In his A Companion to Marx's Capital he, too, is committed to the idea that, embracing science, Marx undertook 'a mode of investigation and inquiry that can uncover the deep structure of capitalism'. As Harvey also refers to this structure, it is a 'deep value structure'. Again, however, one is entitled to ask if Marx's mode of investigation not only can but actually did uncover the deep structure of capitalism - a structure which might be shown to be significantly determinative of the relevant object of explanation (capitalism itself) and consequently capable of explaining it. Harvey does address this question at one point, if only indirectly and whether or not he is aware that that is what he is doing. Observing that a price can be put on things which are not the product of labour, he writes: 'if prices can be put on anything independent of their value, and if they can in any case quantitatively fluctuate all over the place independent of [labour-determined] value, then why is Marx so fixated on the labor theory of value?' The answer Harvey gives to this question refers to the material basis of life, to the real transformation that labour effects upon nature and which is crucial to human existence. As he writes: 'if everybody tried to live off the spectacle of waterfalls or through trading in conscience and honor, no one would survive'.
Intended as support for a specifically labour theory of value, this suggestion is philosophically inept. It appeals to entities and processes which certainly do include human labour and its transformative effects, but which include, as well, material inputs to the production process that are not productive of value according to Marx: natural resources, raw materials, tools, machines and so forth. Harvey's answer to the question he himself poses, in other words, does not distinguish why, in Marx's theory, the expenditure of human labour-power should, but the use of, say, horse power, or of the natural force of a river, should not, yield objective economic value. And this is as much as he has to offer in support of a thesis informing his entire presentation of Capital, the thesis that Marx found the way to uncovering capitalism's deep structure.
There is, to be sure, nothing wrong with the idea that in the social sciences explanation may uncover laws and/or structures which are not immediately visible to the participants in the social processes under investigation but are the product of research and analysis and the construction of theoretical hypotheses. But the mere enunciation of some supposed law or deep structure is not sufficient unto itself. Its claims to intellectual attention, to actually being explanatory of what it is thought to explain, requires an effort of argument, of following through to show how the surface appearances of social life (to put this in the way Marx himself sometimes put it) can be traced back to their determinant causes; or conversely to show how - that is, by what paths and mechanisms - these causes work through to the actual consequences, events, tendencies or what have you, of the real world. For two other possibilities have always to be considered than that an effectively determining and explanatory underlying structure has been identified. First, it is possible that the structure hypothesized does not exist and so can explain nothing. Second, it is possible that even though it does exist it either does not explain anything or does not explain what those invoking it think it explains.
Both of these abstract possibilities are pertinent to the case in hand. Marxian value is defined as being determined by the labour-time on average socially necessary in given conditions to reproduce some particular commodity, and prices are held by Marx to fluctuate around this value (in his simpler model) or to be governed by it in a more indirect but not fully specified way (in the more complex model). As readers of Capital will know, however, one crucial commodity, at the very centre of his account of exploitation, is labour-power itself, the capacity of the labourer to work. Apart from several other difficulties with Marx's theoretical treatment of labour-power - difficulties we shall come to shortly - the value of labour-power is held by him to include a historical and moral element, since it is not a matter simply of brute natural fact what workers require in order to be in a 'normal' condition of health and capacity when presenting themselves ready for work; there is, as we might say today, a cultural component involved. But this means that identifying a value of labour-power that is, so to say, 'underneath' its varying prices is no longer a viable enterprise. There is no determinate value of labour-power definable separately from the price of labour-power and its fluctuations - in other words, separately from actual wage levels - because it will be impossible to bypass the latter in settling what is the historical and moral component in the needs of the labourer.
Even if this problem - a disabling circularity - did not exist, and value could be arrived at as Marx says it is, there is the second possibility to be faced: which is that, existent as they may be, labour-determined values do not uniquely determine price, because price is set by a number of factors, the labour-content of the commodity only one amongst them. Marx, as it happens, was perfectly well aware of this when he needed to be: he accepted that a produced object which is 'useless' (for which there is no demand) has no value at all, however much labour may be embodied in it. But he thought to restrict, without more ado, the influence of social utility and demand on the determination of value to that one effect. Why usefulness and effective demand may determine whether a commodity has any value at all but not, also, contribute to determining how much value it has, is a question to which he gave no persuasive answer.
In any case, the books by Eagleton, Jameson and Harvey which we have referred to are as if innocent of the existence of such questions, while putting forth knowledge claims on behalf of Marx's Capital that depend on the questions having been addressed and satisfactorily answered. From reading those three books one might think it were enough simply to assert that labour is the unique source of economic value, without having to go to the trouble of showing how prices in the real world are governed by labour-determined values. Yet unless this can be shown, Marx cannot have revealed 'the economic law of motion of modern society'.
[I shall be posting further excerpts in the days ahead. For the full paper (PDF), 'Marx's economy and beyond', just click through the link. See also 'On working together'.]