In Capital III,
Marx
Revised/Further-
Concretized
his
Profit-Rate
Model.
Part 6.:
Karl Seldon on Karl Marx Series.
GLOBAL STRATEGIC
HYPOTHESES.
Dear Reader,
It
is my pleasure,
and my honor, as an elected member
of the Foundation Encyclopedia Dialectica [F.E.D.]
General Council, and
as a voting member of F.E.D., to share, with you, from time to time, as they are approved for public release by the F.E.D. General Council, Karl Seldon’s commentaries on the
world-historic breakthrough work of Karl Marx.
This 6th text in this by now long-running
series is posted herewith, together
with supporting text-images and diagrams
[Some E.D.
standard edits have been applied, in the version presented below, by the editors
of the F.E.D. Special Council for the Encyclopedia,
to the direct transcript of our co-founder’s
discourse].
Seldon
–
“In volume three of Marx’s “Capital:
A Critique of Political Economy”, in Part III thereof, “The
Law of the Tendency of the Rate of Profit to Fall”, at the end of Chapter
XIII , “The Law as Such”, Marx revises, or rather, further concretizes,
his profit-rate metric and model, bringing it a step closer to “the surface of
[capitalist] society” [Marx].”
“Marx wrote: “The rate of profit must be
calculated by measuring the mass of produced and realized surplus-value not
only in relation to the consumed portion of capital, reappearing in the
commodities [K.S.: e.g., Marx’s “c”],
but also to this part plus that portion of unconsumed but applied capital which
continues to operate in production [K.S.: let’s call this ‘f’, for the remaining, so far wear-and-tear undepreciated
value of “fixed capital” for the give round of production].”*
“At this point in Marx’s argument, the profit-rate
ratio is no longer just (s/(c + v)),
but has developed/- ‘thought-concretized’ to s/(f + c + v).”
“Thus, at this stage in his systematic-dialectical
exposition of the critiqued categories of classical capitalist “political
economy”, Marx is no longer abstracting from the reality of “fixed capital”.”
“The latter ratio is not a question of
“mixing up flows with stocks”, with f
denoting a “static stock” of capital-value, and (c + v) denoting a “flow” of capital value. In any given round of production, a certain
value of the wear-and-tear-still-undepreciated fixed capital “stock”, and the [“flow”] part of that
fixed capital-value that was wear-and-tear-depreciated in that specific round
of production, the cd portion**
of c, as well as the value of the wages paid out to the
workers whose labor-power was consumed in that round of production, v, need to be considered as components of the total input
that caused/enabled the commodity-capital-value output of that
round of production. They need to be
combined, and can be added together, because they are all commensurable in
value-terms, i.e., as quantities of capital-value.”
“The principle informing this reformed form of
profit-rate metric is this: all the capital-value that causally
participates in the production of commodities and of their value, including
their component surplus-value, must be included in the denominator, and
measured against a numerator which represents the gain of value result
of that production, i.e., of that causal participation; the gross gain, s, or, better, the net gain, s’.”
“The profit-rate ratio is to be a “gain ratio”, analogous to an “amplification factor”, a ‘value-effect divided by its value-cause ratio’, measuring the upper bound of the potential rate of accumulation of capital-value. It is to be an input-over-output ratio. If I denotes the capital-value Input to the production process, and O its capital-value Output, then the ratio (O/I) is the gross gain-rate ratio, and ((O – I)/I) is the net gain-rate ratio. Both are ‘causal gain-rate ratios’.”
“In terms of the value-components of Marx’s model of
commodity value, namely (c
+ v + s); in Marx’s
earlier-in-the-exposition, more abstract profit-rate metric, the s/(c + v) metric, with O = s
taken as the, commodity-capital, value-output of the commodity production
process, and with
I = (c + v)
taken
as the capital-value input to that commodity-capital production process, Marx’s
profit-rate metric arises as [commodity-]capital-value-output divided by
capital-value input –
((c + v + s) – ( c + v))/( c + v) = (s)/(
c + v).”
“To reformulate the above ratio-metric in terms of
Marx’s two other key ratios, namely “the rate of exploitation of labor”, (s/v), and the “organic composition of capital”, (c/v), we can multiply the ratio above by 1, in the specific form of ((1/v)/(1/v)). But note that
this ratio, to produce a defined multiplicand, presupposes that v is never equal to 0:
((1/v)/(1/v)) x (s/( c + v)) =
((s/v)/( (c/v) + 1)).”
“The, now a component-ratio, of this ‘ratio of ratios’,
(c/v), is an imperfect index/proxy for the level of the
social forces of production. The
component-ratio (s/v) is an imperfect proxy for the resulting rate,
increasingly, of “relative surplus-value” as opposed to “absolute
surplus-value” [Marx].”
“With the concretization to s/(f + c + v), the above transformation produces, instead, the
ratio –
((s/v)/( (f/v) + (c/v) + 1))
– implying a more ‘thought-concrete’, less-imperfect
version of the “organic composition of capital” to be, instead of just (c/v), the ratio (f + c)/v.”
“Note that capitalists’ measure the, ‘thought-concrete’, “surface of society” profit rate, typically, as “ROI”; “Return
On Investment”, R/I, but in an ideological and delusory way. They do not include
labor-costs, wages, v, as part of their Investment. They denigrate labor costs as a
mere “expense of doing business”, along with raw materials, auxiliary
materials, power expenses, rent expense, interest expense, and taxes expense,
etc. They deny human labor as a directly
causal agency in the creation of their “Returns”. Their
profit-rate metric, in terms of Marx’s variables, is something like (s/f).”
“There is much discussion today about recent
accelerated progress in the development of the social forces of production, and
of “fixed capital”, in the form of AI Android Robots, and the potential of such
robots to replace human workers.”
“Elon Musk, and others, have even speculated about a
tendency toward a complete replacement, in social production, of
the human workforce, by such robots.”
“Were that to become possible, we would experience what
we call ‘The Elon Musk Singularity’ –
Limvà0((s/v)/( (f/v) + (c/v) + 1)) à
((s/0)/( (f/0) + (c/0) + 1)) =
((¥)/( ( ¥) + (¥) + 1)) =
(¥/¥): “indeterminate”/“undefined”.”
“In future discussions, we will see how such a
‘robotization of production’ does not, as some today are wont to
say, invalidate Marx’s “labor theory of value”.”
*[p.
229 in the New World paperback edition of 1967.].
**[Marx
typically decomposes his “constant
capital” category into three sub-categories – (1) wear-and-tear depreciation of fixed capital value, plus (2) the value
of raw materials consumed in producing the commodity output,
plus (3) the value of “auxiliary
materials”, consumed in the process of that production, which can be
conveniently notated as cd,
cm, and ca, respectively, such that –
cd + cm + ca
= c ].
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¡ENJOY!
Regards,
Miguel
Detonacciones,
Voting Member, Foundation Encyclopedia Dialectica [F.E.D.];
Elected Member, F.E.D. General Council;
Participant, F.E.D. Special Council for Public Liaison;
Officer, F.E.D. Office of Public Liaison.
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