Saturday, August 31, 2013

Personal Note.

Dear Readers,

I have accepted a "field assignment", for the Foundation, for the month of September, 2013.

For most of September, I am scheduled to be in situations remote from my usual access to the internet.

It is unclear how often I will be able to post entries to this blog during September, and it may be that I will be unable to post for the entire month.

In that case, I look forward to resuming this blog -- including its "Heart and Soul of Marxian Theory", and "Global Strategic Hypotheses", and "In Brief" sub-series -- in October.


Here's Wishing a Happy Labor Day Holiday to you all!



Regards,

Miguel

Friday, August 30, 2013

Thorstein Veblen's Version of Marx's "Law of the Tendency of the Rate of Profit to Fall". A Commentary.


Full Title:

The Historical Dialectic of the Capital-Relation --

Thorstein Veblens Version of MarxsLaw of the Tendency of the Rate of Profit to Fall”.

A Commentary on a Potent Passage from Veblens circa 1904 Theory of Business Enterprise.     



Introduction.  In F.E.D. Dialectics, the driver of the immanent aspects of the historical dialectic of a given dialectical ‘‘‘eventity’’’ is held to be what F.E.D. names as the self-duality, or intra-duality, of that ‘‘‘eventity’’’ itself.

F.E.D. conceives such intra-dualities, generically, as a kind of ‘‘‘self-opposition’’’, or ‘‘‘internal antithesis’’’, that inheres in the innermost internity of such an ‘‘‘eventity’’’, as an ineluctable aspect of its very essence -- of its thus inescapably dual essence -- and that energizes the immanent aspect of its development -- its ‘‘‘self-development’’’, via its «causa immanens», or «causa sui» --  in counterpoint with the forces impinging upon it from its ‘externity, from its external environment, from other ‘‘‘eventities’’’ -- its «causa transiens».  Together, in combination, «causa immanens» and «causa transiens» co-determine the total development, the full life-history, of the individual ‘‘‘eventity’’’.

The classic examples of such intra-duality for F.E.D, in the context of pre-human physics -- of the pre-human and extra-human «physis» -- are those ‘hot, shining orbs’, the stars, the ‘stellar eventities’.  Their immanent development is driven by the ‘intra-dueling’ of their self-gravitational self-implosion and their thermonuclear fusion self-explosion, twin, self-generated -- internally-generated -- ‘self-forces’ that oppose one another at every point of the stellar body ‘internity’, as one core fusion fuel is exhausted, followed by resumed self-implosion, compressing and igniting the core fusion “ash” into a new -- the next -- core fusion fuel, until, typically, a stellar core of consisting of iron arises, terminating the very existence of the star as such in a combined core implosion and ‘exo-core’ explosion, enriching the interstellar medium with the dying star’s evolved, “metallic”, higher atomic species from which, eventually, ‘contra-stars’ -- “planets”, cold[er], ‘shine-less’ orbs -- are formed, in subsequent generations of stellar/planetary system-formation.

But the «genos» of intra-duality manifests «species» and instances also within the domain of ‘human physics’ as well -- within the human-social epoch of cosmological ‘self-meta-evolution’.

A prime, and salient example of such a systemic intra-duality for that epoch, is the primary ‘intra-duality’ of “the capital-relation” as the predominating “social relation of production” of modern society, i.e., of “capital-value”, and its “law of motion” -- the ‘‘‘law’’’ of its motion of “accumulation” [and of ‘‘‘dis-accumulation’’’] -- as uncovered by Karl Marx.  For “the capital-relation” [Marx], the primary intra-duality is the internal opposition, within the movement of the “total social capital” [Marx], between capital as self-expanding value, and capital as self-contracting value, which is such that both of these opposing processes are ineluctably self-caused, self-imposed, by capital, upon capital, as a result of the very nature of the capital ‘‘‘eventity’’’ itself.

Capital as self-expanding value [Marx] arises via the productive reinvestment of produced surplus-value -- e.g., in the form of profits of enterprise -- in the enterprise that produced that surplus-value, or in other productive enterprises -- thus expanding the capital-value of total social capital-assets.

Capital as self-contracting value [Seldon] arises via the competitive-survival-incentives that the capitals-system imposes on individual capitals in general -- on those individual “personifications” of the capital-relation, the capitalist -- to boost the [relative] surplus-value / profits that their enterprises produce, by inventing and/or purchasing and installing -- investing in -- new, better capital plant and equipment, capital plant and equipment which produces more units of output per unit time than do older vintages, or that costs less to purchase while delivering the same output rate, or that costs less to operate while delivering the same output rate, or which realizes some combination of such “better” features.

The consequence of the installation and operation of such “better” capital plant and equipment, by one enterprise, upon the other enterprises that compete with it, and which have not [yet] so-installed, is to lower their profit margins as a result of the underselling of their prices of output by the prices of the installing competitor-enterprise, or to force them to de-install and write-off their old capital plant and equipment, and to install the new, to remain price-competitive, causing a drop in their net profits, at least for the accounting-period(s) in which that write-off, and the initial expenses of purchasing and installing the new capital plant and equipment, occur, or some combination of the two, after which their rate of return on the new equipment itself should recover.

Over time, in the ongoing continuity of innovation, installation, and operation of progressively improving industrial capital plant and equipment -- the continuity ofthe growth of the social forces of production [Marx], i.e., of the rising rate of human societal self-reproduction, i.e., of the rising rate of ‘self-productivity’ of humanity/of ‘human socio-mass’ -- this process that we have named ‘the self-depreciation of capital’, and ‘technodepreciation’, drives a continual devaluation of accumulated capital-value, a ‘dis-accumulation of capital’, that is “netted out” against the equally ongoing self-expansion of capital value that is driven by the reinvestment of industrial, etc., profits, into industrial, etc., production.

During the initial phase of capitalist development, which we term its ‘‘‘ascendance phase’’’, when the capital plant and equipment composition of total capital is still relatively low, reflecting lower productivity, so that the proportion of capital that is exposed to devaluation is also relatively low, the expansion of profits, and of capital, tends to outstrips their ‘technodepreciation’-driven contraction.

The accumulating, growing proportion of capital plant and equipment in total capital, and the rising rate of occurrence of ‘technodepreciating innovation’, as a result of the capitalism-immanent incentives already cited, and reflecting a rising rate of rising social productivity, eventually generates a turning point, after which the technodepreciation-driven contraction of the total social capital value outstrips capital’s co-occurring expansions.  This second main phase of capitalist development is that which we name the “descendance phase” of capitalist development, which, to our data, appears to have occurred circa 1887, at least for North American industrial capital [ for more about this determination of timing, see http://capitalismsfundamentalflaw-wayforward.blogspot.com/2012/12/part-5.html ].


It is, psychohistorically, very telling, indeed, to see how these processes, and their consequences, are observed by Thorstein Veblen, writing circa 1904, some 17 years after the silent turning point that we have ascertained, but at a time by which the profound consequences of that turn had become more widely -- and more “loudly” -- evident.

Extract and Commentary.  Below we extract a particularly pregnant passage from Veblen’s 1904 Theory of Business Enterprise, adding our own commentary regarding his perceptions, and regarding the -- psychohistorically predictable -- ideological, policy, and institutional responses of the ruling plutocracy in light of Veblen’s insights, and those of Marx, and those of others, into the inherent self-destructive destiny of capitalism -- responses which we have characterized elsewhere under the headings of ‘Anti-Marxian Marxianism’, ‘Capitalist Anti-Capitalism’, and ‘Human Anti-Humanism’.


Veblen predicted “chronic depression” as the new norm for the global capitalist economy, as a result of what we would term the turn from the ‘‘‘ascendance phase’’’ to the ‘‘‘descendance phase’’’ of the global capitals-system:  

Chronic depression, however, does not seem to belong, as a consistent feature in the course of things, in this nineteenth-century period, prior to the eighties or the middle of the seventies.” 

The usual course, it is commonly held, was rather:  inflation, crisis, transient depression, gradual advance to inflation, and so on over again.

[M.D.]:  We interpret the passage above as noting a change in the dynamics of capitalism, reflecting what we would describe as the turn from the ‘‘‘ascendance phase’’’ into the ‘‘‘descendance phase’’’ of the global capitalist system.

Veblen continues --

On the view of these phenomena here spoken for, an attempt at explaining this circuit may be made as follows: 

A crisis, under this early nineteenth century situation, was an abrupt collapse of capitalized values, in which the capitalization was not only brought to the level of the earning-capacity which the investments would have shown in quiet times, but appreciably below that level.

[M.D.]:  In the passage above, Veblen defines what we would term “ascendance phase crisis” as a critical and precipitous ‘self-contraction of capital-value’, overshooting even the restoration of a normal ratio of net earnings to fixed-capital value -- a normal rate of “return on [capital plant and equipment] investment” -- that would register the accumulated ‘technodepreciation’ of capital plant and equipment, accumulated over the course of the “inflationary” period.  The very non-registration, up until the crisis, of this ‘technodepreciation’, was, itself, a major hidden cause of that crisis -- of that eventual precipitous contraction/deflation of plant-and-equipment capital-value, and of other, related, capital-value, which is the crisis. 

The crisis-induced drop in the value of the “return on investment” ratio’s capital-plant-and-equipment-value denominator, relative to that ratio’s net-earnings [“return”] numerator, has a post-crisis salutary effect.  It raises the magnitude of that “profit-rate” ratio as a whole.  That ratio had tended to fall as a whole, during the “non-crisis” phase.  It tended to fall because productivity-increase-induced, competitive drops in prices, hence in the net earnings numerator of that ratio, owing to the productivity-increase-induced drop in unit costs of production, failed to be compensated by a commensurate drop in the valuation of the ratio’s capital plant and equipment value denominator, such as would have registered the ‘technodepreciation’ of that capital plant and equipment value denominator, owing to the accumulated non-crisis period’ -- or pre-crisis-period’ -- productivity improvements.

Veblen then advances his argument as follows --

The efficiency and the reach of the machine industry in the production of productive goods was not then so great as to lower the cost of their production rapidly enough to overtake the shrinkage in capitalization and so prevent the latter from rising again in response to the stimulus of a relatively high earning capacity.

[M.D.]:  Above, Veblen locates the key locus of ‘technodepreciation’ in what Marx termed “Department I”, the department of “the production of means of production”, of ‘the machine production of production machinery’, for what Marx termed “Department II”, the department of the production of the means of population-sustaining consumption. 

Veblen holds that, in what we term the ‘ascendance phase’ of the capitals-system, the velocity of improvement in the efficiency [and in the design] of the means of production, thus technodepreciating older vintages of those means of production, already installed, was insufficient to match and, indeed, to exceed the crisis-induced over-shrinkage of the “capitalization” -- of the capital-valuation -- of the already-installed, ‘technodepreciated’ means of production.  Thus, there remained a margin of that overshoot, leading to a higher net-earnings numerator value relative to that ‘over-shrunk’ capital plant and equipment denominator value, after the crisis-shock waned, sufficient to stimulate a rise in the valuation of that denominator, partially restoring the pre-crisis capital-valuation of that denominator, given the higher-than-normal earnings relative to that ‘over-shrunk’ denominator.  The latter rise tended to restore a normal/expected value of that net-earnings-divided-by-capitalization ratio as a whole, correcting the initial post-crisis ‘high-side super-normal value’ of that ratio, owing to the crisis-induced undervaluation of that ratio’s denominator.

Veblen then summarizes these dynamics of ‘ascendance phase’ capitalist crisis as follows --

The shock-effect of the liquidation passed off before the cheapening of the means of production had time to catch up with the shrinkage of capitalization due to the crisis, so that after the shock-effect had passed there still remained an appreciable undercapitalization as a sequel of the period of liquidation.”

“Therefore there did not result a persistent unfavorable discrepancy between capitalization and earning capacity, with a consequent chronic depression,”

“On the other hand, the earning-capacity of the investments was high relatively to their reduced capitalization after the crisis.”

“Actual earning-capacity exceeded nominal earning-capacity of industrial plants by so appreciable a margin as to encourage a bold competitive advance and a sanguine financiering on the part of the various business men, so soon as the shock of liquidation had passed and business had again fallen into settled channels.

[M.D.]:  Veblen then sets forth his view of the causes -- and of the consequences -- of the then-recent, “permanent” change in those dynamics of ‘‘‘ascendance phase’’’ crisis, that characterize what we term the pre-1913, early ‘‘‘descendance phase’’’ neo-dynamics’ of capitalist crisis --

Since the [M.D.:  eighteen-]seventies, as an approximate date and as applying particularly to America and in a less degree to Great Britain, the course of affairs in business has apparently taken a permanent change as regards crises and depressions.”[M.D.:  Our --transition from the ascendance phase to the descendance phase of the global capitals-system. ].

“During this recent period, and with increasing persistency, chronic depression has been the rule rather than the exception in business.”

“Seasons of easy times, “ordinary prosperity”, during this period are pretty uniformly traceable to specific causes extraneous to the process of industrial business proper.”

“In one case, the early [M.D.:  eighteen-]nineties, it seems to have been a peculiar crop situation, and in the most notable case of a speculative inflation, the one now (1904) apparently drawing to a close, it was the Spanish-American War, coupled with the expenditures for stores, munitions, and services incident to placing the country on a war footing, that lifted the depression and brought prosperity to the business community.”

“If the outside stimulus from which the present prosperity takes its impulse be continued at an adequate pitch, the season of prosperity may be prolonged; otherwise there seems little reason to expect any other outcome than a more or less abrupt and searching liquidation.”

“ ...It was said above that since the [M.D.:  eighteen-]seventies the ordinary course of affairs in business, when undisturbed by transient circumstances extraneous to the industrial system proper, has been chronic depression.  The fact of such prevalent depression will probably not be denied by any student of the situation during this period, so far as regards America and, in a degree, England ...”

“The explanation of this persistent business depression, in those countries where it has prevailed, is, on the view here spoken for, quite simple.”

“By an uncertain date toward the close of the [M.D.:  eighteen-]seventies the advancing efficiency and articulation of the processes of the machine industry reached such a pitch that the [M.D.:  fall in the] cost of production of productive goods [M.D.:  i.e., of capital plant and capital equipment, functioning as “means of production ”] has since then persistently outstripped such [M.D.:  downward] readjustment of capitalization as has from time to time been made [M.D.:  e.g., due to crises].

[M.D.]:  Thus, it is the increase, past a certain critical point, in the pitch -- the acceleration -- of the rate of improvement of the overall productivity of the means of production, for Veblen, that explains this change,  which we term the turn, from ‘‘‘ascendance phase’’’, self-overcoming aperiodic economic crises, to ‘‘‘descendance phase’’’, self-perpetuating, chronic depression-crises -- change in the crisis-dynamics of capitalism.

This change, per Veblen, manifests also as a “persistent decline” in [the rate of] “profits” [in the value of profit returns divided by the value of the “industrial apparatus” used in producing those profits] --

The persistent decline in profits, due to the relative overproduction of industrial apparatus, has not permitted a consistent speculative expansion, of the kind which abounds in the earlier half of the nineteenth century, to get under way.”

“When a speculative movement has been set up by extraneous stimuli, during this late period, the inherent and relatively rapid decline in earning-capacity on the part of older investments has brought speculative inflation to book before it has reached such dimensions as would bring on a violent crisis.

“And when a crisis of some appreciable severity has come and has lowered the capitalization, the persistent efficiency and facile balance of processes in the modern machine industry has overtaken the decline in capitalization without allowing time for recovery and subsequent boom.”

The cheapening of capital goods has overtaken the lowered capitalization of investments before the shock effect of the liquidation has warn off.”

Hence depression is normal to the industrial situation under the consummate regime of the machine, so long as competition is unchecked and no deus ex machina interposes..

[Thorstein Veblen, The Theory of Business Enterprise, Charles Scribner’s Sons [New York: 1904], pp. 248-255, emphases added].


The questions which should leap to mind, in the aftermath of reading this circa 1904 description of the ‘‘‘law’’’ of a ‘technodepreciation-induced’ fall in the rate of profit on industrial capital, since a ‘‘‘turning point’’’ after the 1870s in the U.S., and, in lesser degree, also in the U.K., leading to a condition of “chronic depression”, of “persistent business depression”, include the following --

1.  ¿What was the capitalist class moved to enact -- in terms of new economic policy, new “popular” ideologies, and new political-economic institutions -- in response to the prospect of ‘‘‘permanent depression’’’, and the specter of a popular search for alternatives to capitalism -- for alternatives to the rule of that ruling class -- leading to the overthrow of the power and the “perks” of that ruling class?

2.  ¿Did the circa 1913 imposition in the U.S., by that ruling class, of the Federal Reserve System, of the Federal Income Tax, and of World War I, serve to mitigate the trend to “chronic depression” that Veblen observed, and essayed to explain, and to further mutate the dynamics of the global capitals-system itself, leading to the principle historical phenomena that humanity has experienced since World War I?

Perhaps key clues to the answers to these questions were captured in the paper that we have cited here before [ Geert Reuten, "The Incompatibility of Prolonged Technical Change and Competition: Concurrence and the Socialization of Entrepreneurial Losses through Inflation" http://www1.fee.uva.nl/pp/bin/642fulltext.pdf ], in which the author, Geert Reuten, summarizes as follows [emphases added]:

To the extent that technical change accelerates, price competition precludes the full amortization of capital investments.”

“In contrast with the common opinion that both technical change and competition are key characteristics of the capitalist system, they are incompatible, at least when technical change accelerates.”

“Such acceleration then gives rise to forms of concurrence — abstinence from price competition, price leaderships, cartels.”

“The particular form depends on the structure of production of enterprises (i.e. the make-up of the stratification of capital).”

Concurrence is a major determinant of the inflationary form of the accumulation of capital.”

“Because it is in their interest, banks tend to accommodate the concurrent price settings of enterprises and so to accommodate a socialisation of private losses that would be due to the devaluation of capital in the case of price competition.”

“Price inflation also puts enterprises in a relatively advantageous position vis-รก-vis labour.


Amplifying upon Reuten’s final point, above, we note that “permanent inflation” is, precisely, a permanent tendency to reduce real wages and salaries, if nominal wages and salaries remain constant, or even if wages and salaries increase, but at a rate of increase (s)lower than the rate of general consumer price inflation.

And exponential “permanent inflation” [excepting the 1930’s “Great Depression” ‘Great deflation’ aftermath to the 1920’s “roaring” inflation] is exactly what the U.S. has had, ever since the “Fed” was imposed, by the ruling class, in 1913, as shown by the data unified in the following remarkable, and little-known, graph, also cited here previously --




Certainly, the continual de facto reduction of wages, by Fed-managed chronic, exponential inflation, helps to shore up capitalist profits, and their rates, and to mask, to delay, or even to avert technodepreciation losses.

For a ruling class hell-bent on averting the massive technodepreciation of its older-vintage, legacy capital plant and equipment in its U. S. and U. K. core, due to the price competition of newly-industrializing, lower-wage nations in its periphery, installing the latest, most advanced vintages of capital plant and equipment from the start -- i.e., for a ‘Capitalist Anti-Capitalist’ ruling class, hell-bent on suppressing capitalist industrialization in the periphery of its core, hence hell-bent on creating a “Third-World” of military dictatorships and rising poverty -- it certainly helps to have a “Federal Income Tax”.

That tax allows that ruling class to, in effect, create a new category of “surplus-value”, draining away part of the wages of the working class as personal income losses, paid to the national state, and using the vast proceeds of those income taxes to force the core working class to pay for “foreign aid” to the military junta’s that the ruling class sets up in those “peripheral” nations, to suppress industrial development there, and to massacre democratic nationalists there who oppose that suppression.

Veblen pointed out how episodic wars can temporarily mitigate the tendency to chronic depression that he describes:  “it was the Spanish-American War, coupled with the expenditures for stores, munitions, and services incident to placing the country on a war footing, that lifted the depression and brought prosperity to the business community.”

World War I, launched by the core ruling class about the same time that it imposed the Fed, and the Federal Income Tax, upon the U. S. working class, certainly represented a big boost for manufacturers of munitions, and for the financiers who financed them, enabling them to shamelessly sell military “goods” to all sides of the conflict -- military goods that would not “last” on shelves, but that, instead, would be used -- and used up -- in short order, requiring rapid replacement, hence new repeat sales in rapid succession.

Making war, and preparation for war, into a permanent institution, a “military-industrial complex” [Eisenhower], massively supported by the working-class income, and by the profits of subordinated capitalists, taxed away from them by the Federal Income Tax, would give a lasting boost to “business”, at the cost of diverting vast former forces of production into forces of destruction of forces of production, whenever those resulting military “goods” were used, or to mere waste of productive forces when those military “goods” simply sit idly in arsenal.

¿But what new kinds of capitalist “crises” -- of global “Great Depressions” and “Great Recessions” -- and the Totalitarian Dictatorships, the Genocides, and the Global Wars to which they lead -- arise out of the dynamics of a capitalism mutated by National Income Taxes, National “Military-Industrial Complexes”, and National, fiat-currency-foisting “Central Banks”, a la the U.S. “Fed”?


To those questions, we plan to devote many subsequent blog-entries.



Sunday, August 18, 2013

The Historical Dialectic of the Forms of Exchange-Value. A Marxian-Algebra-Facilitated Narration.



Full Title --

The Historical Dialectic of the Forms of Exchange Value, From Commodity to Money to Capital.

A Marxian-Algebra-Facilitated Narration.



Dear Readers,

In this narration of the historical dialectic of the forms of exchange-value, I will limit myself, in the main, to the shorthand that Marx developed to describe human action, human social praxis, or human social-reproductive process, during the epochs of the subsumption of those collective-human attributes by exchange-value, by alienation -- in short, by selling, culminating in ‘‘‘self-alienation’’’, or, at root, in ‘self-selling’ [the proletarian condition:  wage-labor; labor-time based compensation in general].

Always remember that this subsumption of humanity by exchange value, a category of human ‘socio-ontology’ also created and sustained by humans, is and was humanity’s own act, even though no alternatives to that subsumption can sustainably arise until the social forces of production exceed the level at which they now reside, and at which they have resided in the past.

Indeed, the central purpose of Karl Seldon’s Foundation Encyclopedia Dialectica [F.E.D.] can be gasped as developing scientific dialectics, based upon the examples of it provided by Marx and Engels, the true fathers of scientific dialectics.

Scientific dialectics had heralds and precursors in Heraclitus, in Plato, and in Hegel, all of whom, however, mystified dialectics, and grasped dialectics mainly mystically.

That is, a central purpose of F.E.D. is to redress the consequences of the fact that Marx died trying to complete Capital, and did not live to undertake the work which he repeatedly set for himself as his next scientific task -- to “write the book” on scientific dialectics in general -- and of the fact that Engels essentially died editing Capital -- that is, died soon after sending volume II and then volume III to press, and did not live to develop, and to complete, and to publish a finished work from the draft that he left behind, of his Dialectics of Nature.

Now first, it is true:  Marx’s account, in Capital, is, directly, a systematic presentation, a presentation of present human society in terms of its fundamental social relations categories, ordered systematically, not chronologically. 

It is not meant to present the history of human social relationships [of production] from the beginnings of the human species.  

Marx’s account belongs, first and foremost, to Systematic Dialectics, not to Historical Dialectics.

However, there are, present, strong components of the history of human social relations, and of the chronological order of their genesis, “behind” Marx’s systematic account, which he deliberately accentuates, especially in the first chapters of volume I, on Commodity, Money, and Capital respectively.

Marxians, by and large, have not fully appreciated the meaning and the import of the two fundamental concepts that permeate Marx’s “Marxian” works from beginning to end -- from The German Ideology, through the Grundrisse and A Contribution to the Critique of Political Economy, to all of the four volumes of his Capital -- namely the concept of the social forces of production, and the concept of the social relations of production [the latter was originally named, by Marx and Engels, the forms of [human, social] intercourse as of the time that they wrote The German Ideology, and later re-named].

But it is clear, at least, that, besides the social relations of primitive, communal hunting and gathering extended-familial groups, of slavery, of feudal serfdom, etc., the term “social relations of production” was intended, by Marx and Engels, to encompass the forms of “the exchange value”, principally Commodity [“the Commodity-relation”], Money [“the Money-relation”], and Capital [“the Capital-relation”].


So let us describe these three social relations of production, in the chronological order of their arising, using Marx’s shorthand, and, thereby, reveal the human-historical dialectic that “they” -- that human beings, personifying them -- have created.

The “dialectical algebra” developed by F.E.D. is rooted in this shorthand developed by Marx.


Consider the Commodity-relation, as it arises, historically, prior to the existence of -- prior to humanity’s discovery and embodiment of -- either the Money-relation or the Capital-relation.

The human praxis around this, first, form of exchange-value, is commodity barter, or, in Marx’s '''algebraic''' shorthand --

C -- C’

-- describing the kind of human act in which the human holder of one kind of commodity, denoted by C, exchanges it for a different kind of commodity, held by another human holder, denoted by C’.

This is the highest form of exchange-value praxis that humanity manifests -- the highest form that the level of the human social forces of production, or of “human productivity”, can either support or necessitate -- for many millennia.

It already requires a level of the productive forces capable of producing a surplus production of the commodities traded between communities -- too much of one commodity produced for all of it to remain use-value in one community, too little of it produced in the other, barter-partner, community, for that particular commodity.

But the C -- C’ human praxis / process both expresses a rise in the human, social forces of production, and stimulates a further rise in those social forces of production.

Gradually, social productivity, social productive force, grows to the point where a money-commodity -- eventually, a precious metal -- separates itself out, in human praxis, from the rest of the commodities, and, at length, congeals, in human praxis, as full Money.

The Money-relation is born, from out of the womb of the Commodity-relation.


Each unit of Money is a ‘meta-Commodity’ unit, made up out of -- in the MINDs of the human agents of exchange -- that heterogeneous multiplicity of the limited ensemble of the units of all of the different kinds of Commodities for which Money will effectively trade, given the social conventions of the time and place in which those agents live.

Money is thus not exclusively a physical-material reality, but a psychohistorical materiality, combining both physical objects and meme objects, or mental objects.

Thus, the action of the growing population of Commodity-relations, of “Cs”, among themselves -- as that population of C-relations expands and densifies with the growth of the social forces of production -- at a certain threshold in that growth, irrupts a whole new kind of human social relation, called the Money-relation, which Marx “shorthands” by M.

As a result, the “circulation” of human production takes a new, Money-mediated form --

C -- M -- C’

-- the “money-mediated circulation of commodities”.


¿So, what do we have of this [his]story and [her]story of humanity so far?


The symbol C denotes the original form of exchange-value, the “Commodity” of the Commodity barter process, and of the Commodity-social-relation-of-production.

The internal action within the growing manifold of Cs, reflecting the growing human social force of human social re-production, at length irrupts something new, which Marx notates as M, “Money”, the Money-social-relation-of-production.

So, historically, “C of C” still reproduces C, but, past a certain productive-force threshold, also produces something new, M:

C of C becomes C + M.

That is the first phase of an “historical dialectic”.


The “original” or “thesis” form of exchange-value, C, acting on/within itself, further expands itself, but also gives rise to a new, supplementary opposite form of exchange-value, M, so that, where once only C existed, later both C and M co-exist, together, or --

C goes, in time, to C & M:  C   --->   C + M + . . .

Then also, C and M do not merely coexist, but they synthesize, in human action, into a unified, society-wide process of the human movement of human products, forming a third category, “circulation”:

C -- M -- C’ -- M -- C’’ -- M -- C’’’-- M -- C’’’’-- . . ..



In F.E.D. notation, this story can be summarized, in “shorthand” [in terms of what we call a “Triadic” Seldon Function] as --

C   --->   C + M + q/MC

-- wherein q/MC “shorthands” that synthesis of C and M which is “the movement of the circulation of Commodities, mediated by Monies”.


As humanity’s productive forces grow further, higher -- in part, under the stimulus of that expanded and accelerated exchange and circulation of Commodities to those who want/need them, that this mediation by the Money-relation enables, a second threshold is crossed.

The “reflection” of “the Money/Commodity Circulation Process” upon itself reveals/produces its own inversion --

C -- M -- C’ -- M -- C’’ -- M -- C’’-- M -- C’’’’-- . . .

-- becomes, or also soon includes --

M -- C -- M’ -- C’ -- M’’ -- C’’ -- M’’’-- C’’’ -- M’’’’-- . . .

-- and the Capital-relation, K, is borne, e.g., at first, in the “antediluvian form” of “merchants’ capital”.

In our notation, this further story can be summarized, in “shorthand”, as --

C    --->    C + M + q/MC    --->    C + M + q/MC + . . . + K + . . ..



Each unit of this “new category on the block”, this new supplementary opposite to both Commodity and Money, this new kind of exchange-value, this new social relation of production -- namely, “the Capital-relation”, which we “shorthand” here as “K”, or as “K”, from the German «Kapital» [since the “C” or “C” is “already taken”, by “Commodity”] -- is “a ‘meta-Money’ unit, made up out of a multiplicity of [past profit/loss-]Monies units”.

E.g., a merchant’s capital, or “retained earnings”, come to be made up out of the net of that merchant’s history of trades, of that merchant’s “period[ic] income statements”, of the net of that merchant’s negative [net loss] and or positive [net gain] monetary results over time, over many [accounting] periods:

M’ minus M;

M’’ minus M’;

M’’’ minus M’’;

M’’’’ minus M’’’, . . .



C of C” becomes C + M, and then, later,

q/MC of q/MC” becomes q/MC + K.

The money-mediated circulation of commodities [q/MC] still persists, but some of it later turns into the circulation of [the total social] Capital, mediated by Money-Capital and Commodity-Capital, the new forms that the ancient Money and Commodity relations take on when they have been subsumed by their successor form of exchange-value, namely, by Capital-value.


By the “arithmetical”, “algorithmic” rules of Seldon’s notation, this story of the human, historical dialectic of the human social relations and human social forces of human social [re]production can be re-told, and remembered, in a four-symbol, powerfully semantically-concentrated cognitive form, for the advancing Marxian-historical epochs, generically denoted by t [using color-spectrum ordinal characters-coding below] --

C3t:

for epoch t = 0, C30 = C,

for epoch t = 1, C31 = C + M + q/MC,

for epoch t = 2, C32 = C + M + q/MC + . . . + K + . . .

-- and so on, into the possible epochs beyond the present, beyond the society founded upon the Capital-social-relation-of-production.

This historic example --

C   --->   C + M + q/MC   --->   C + M + q/MC + . . . + K + . . .   --->    . . . .

-- or --

C--C’     --->     C--C’  &  C--M--C’     --->     C--C’  &  C--M--C’  &  M--C--M’     --->      . . .

-- is the classical example of Marxian, historical dialectic, and all of the developments by F.E.D. are an elaboration, an extension, a generalization, and, ultimately, a “universalization” of this classical example.



In our model, ‘‘‘Equitism’’’, the “Way Forward” out of and beyond that self-destruction of capitalism which is descendant-phase capitalism, becomes possible human-social-relations-of production ontology in the next epoch, that of t = 3 and of C33 --

C    --->    C + M + q/MC    --->    C + M + q/MC + . . . + K + . . .    --->   

C + M + q/MC + . . . + K + . . . + . . . E + . . ..



This example, to epoch t = 2, can be rendered, in part, pictorially, as below.









Regards,

Miguel