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Tuesday, 12 February 2013

Michel Foucault’s Critique of Marx’s ‘Surplus Value’ (3)

Firstly, a bit of economic history which shows that Marx was a traditionalist – even at his most “economically revolutionary”.

Michel Foucault places Ricardo- not Marx - as the true revolutionary economist of the 19th century. To Marx and most Marxists, Ricardo was seen as a “transitional figure” between the “classical economists” (e.g., Adam Smith) and Marx’s own theories. 

Foucault argues his case by arguing that it was Ricardo, not Marx, who freed labour(or labour power) from being secondary to monetary and other kinds of exchange. Labour power was the true “measure of value”; not products or their monetary values (as measured in other ways). Goods - all goods - gained value because of the labour power expended upon them; not because of "scarcity", "intrinsic value", or anything else. Labour was at the very heart of economics and thus the determiner of value and exchange. 

It follows from all this that if Marx’s “theory of value” is basically that of Ricardo, the there's no actual break at all between “bourgeois” and “socialist” economic theories (Marx’s own). More specifically, Ricardo and Marx belonged to the same “post-Classical episteme”. In fact the disputes between Marx (Marxists) and Ricardo (the “bourgeois economists”) were, according to Foucault, mere “storms in a children’s paddling pool”.

More interestingly, as mentioned earlier and as hinted at just now, it was Marx’s specific economic theory of “surplus value” (basically derived from Ricardo’s emphasis on labour) which shows Marx to have been the 19th century German metaphysician that he was.

Surplus Value


The gist of Marx’s theory of surplus value is that because the true measure of economic value is labour power (or the units of labour involved in production), then that is reflected in the price the owner of capital asks for when selling his products to others. However, in order for the capitalist to make a profit, he must demand extra labour power to guarantee that profit.

That is, if the capitalist sold goods at the value of their (real) labour power (or the units of labour involved in production), the he wouldn't make a profit because his workers would be paid at the correct (or fair) price for their labour; as expressed in the "labour theory of value". Thus the capitalist must demand extra labour from his workers - over and above what would generate the actual price of their products - to guarantee a profit. That extra surplus value of labour is what generates his profits and which, similarly, is taken away from the workers themselves (who won't now receive a correct or fair price for their labour).

But all this is philosophical baloney. 

Even if the theory can be understood clearly, it still involves incredible metaphysical assumptions. 

Who's to say there is even such a thing as a "fair value" let alone a "correct value" of given labour? How can an economist decide what belongs to the labourer and what belongs to the capitalist? The facts can’t decide this matter. This transference of value from labour is either metaphorical or metaphysical (or both). 

Without arbitrary stipulations, societal customs, norms, economic traditions, etc. none of Marx’s theory is at all factual. It is metaphysical. In a sense it's not even theoretical. It’s as if “real value” or “true price” etc. existed in the ether before any system of capitalist economics even began. Before and during capitalism Marx saw it that there is an absolute value of labour and therefore an absolute value of produce. And if these things are indeed absolute/metaphysical, then surplus value will be an absolute too. 

It must be an economic fact that the capitalist genuinely creams off surplus value from his workers. 
It must be an economic fact that there is a given price for products given a certain amount of labour. 

But how could there be? These aren’t facts. Thus they must be metaphysical or even ethical/political impositions on the economic facts or realities. 

This is like the distinction between "fact and value". Marx imposed moral/political values (literally and metaphorically) on certain economic facts and realities. But that imposition isn't itself factual. It's metaphysical and moral/political.

There is no determinate “value” for labour and therefore for price and exchange. There are facts about how much labour is involved in production. There are facts about how much the capitalist gets compared to the average worker. There are facts about how many more hours the workers work compared to the few hours of the capitalist. But none of these facts determine price and value; let alone facts about surplus value. 

All that Marx offers us is are basically metaphysical assumptions about value which are themselves determined by Marx’s hidden normative/moral position on the status of the worker vis-à-vis the capitalist who employs him. 

Thus Marx goes way beyond economics. He ventures into the realm of metaphysics; as well as into the realm of normative/moral economics.

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