Tom Walker wrote that he (and Max) want to hear more about accounting. I
missed Max' post somehow and am only responding to Tom's desire to find the
>>missing link that
>>I'll call "labour accounting within capitalism".
Tom take a look at an old book, JM Clark's "Studies in the Economics of
Overhead Costs." This addresses the issue of accounting from different
directions and includes a chapter titled "Labor as an Overhead Cost."
Clark was trying to come to grips with accounting while also trying
to get to a dynamic micro. You might find it interesting.
Gene Coyle
>Max Sawicky wrote,
>
>>I'd like to hear more
>>on the substance of the accounting issues, which
>>really get my juices flowing.
>
>I'd like to hear more, too. It seems to me that there is a missing link that
>I'll call "labour accounting within capitalism". Having done a literature
>scan on accounting information and collective bargaining, I have a sense of
>what the missing pieces are but the task of pulling the loose threads
>together is huge. I could write an article or even a book, but I have a
>sense there is an entire missing sub-discipline here.
>
>The usual level of analysis for accounting is the enterprise (the precise
>meaning of "enterprise" is flexible). The tools that accountants have
>developed are for analyzing the performance of enterprises. Even without any
>intent, this perspective privileges the well-being of the enterprise above
>all else. In lay terms, this translates into "your job depends on the
>profitability of the company." What they *really* means is, "*from the
>perspective of the enterprise* your job depends on the profitibility of the
>company." In other words, it's a circular argument dictated by the chosen
>level of analysis.
>
>What I've said above implies that there is a potential "other" accounting.
>Call it non-enterprise accounting or collectivity accounting or even invent
>a new word: "oeccounting". I suspect this is easier said than done. An
>alternative is neither a critique nor a caricature.
>
>ONE OF THE MOST IMPORTANT POINTS IN THE WHOLE OF POLITICAL ECONOMY
>
>To further provoke the sense of an absence, I'd like to quote from the
>Marxist-Leninist classics on accounting. Engels, in his introduction to the
>1891 edition of Marx's Wage Labour and Capital stressed the importance of
>the distinction that Marx subsequently made (years after writing WL&C)
>between "labour" and "labour power". Engels called this distinction, "one of
>the most important points in the whole of political economy."
>
>How does Engels set the stage for his discussion of this "most important
>point"? He does so with a discussion of the relationship between political
>economy and book-keeping:
>
>"Classical political economy took over from industrial practice the current
>conception of the manufacturer, that he buys and pays for the *labour* of
>his workers. This conception had been quite adequate for the business needs,
>the book-keeping and price calculations of the manufacturer. But, naively
>transferred to political economy, it produced there really wondrous errors
>and confusions."
>
>Since my purpose in citing these classics is to tantalize thought rather
>than to enshrine doctrine, I'll now leap to Lenin, on the eve of the Russian
>Revolution (State and Revolution), discussing the socialization of industry
>during the revolutionary period:
>
>"The accounting and control necessary for this have been simplified by
>capitalism to the utmost, till they have become the extraordinarily simple
>operations of watching, recording and issuing receipts, within the reach of
>anybody who can read and write and knows the first four rules of arithmetic."
>
>Note that in a mere 26 years, capitalist bookkeeping had progressed from
>"producing wondrous errors and confusions" in political economy to being
>wholly adequate for the socialist transformation. Incredible advance!
>
>Fast forward another three-quarters of a century. Did Oskar Lange give an
>adequate response to von Mises' critique of the "impossibility of economic
>accounting" under socialism? Did mathematics supersede accounting? Are these
>questions rhetorical? Where does this leave the questions of:
>
>1. socialist accounting; and
>2. accounting counter-discourse within capitalism?
>
>There are suggestive fragments all over the place. I've come across papers
>that look at the accounting issues arising from privitization in Poland and
>the dismantling of apartheid in South Africa. In an earlier post, I
>mentioned Fogarty's paper on accountants' construction of the industrial
>relations arena. There's a review of the literature on accounting and
>collective bargaining and a paper on the use of accounting in wage
>determination in the U.K. coal industry.
>
>But the literature that exists is almost exclusively critique (and that
>which isn't critique is, alas, caricature). As I said before, an alternative
>is neither a critique nor a caricature. If -- as Engels claimed over a
>century ago -- the distinction between labour and labour power is "one of
>the most important points in the whole of political economy", then what has
>prevented this *most important point* from being articulated in an
>accounting discourse?
>
>I can anticipate and reject one answer, which is that the labour theory of
>value doesn't provide an objective foundation for accounting calculation. My
>rejection of this is that the calculation doesn't need an "objective
>foundation." After all, the perspective of the enterprise is subjective.
>
>--------------------------------
>Berry, Maureen. "The Accounting Function in Socialist Economies."
>International Journal of Accounting (1982): 185-198.
>
>Bougen, P. D., Ogden, S. G., & Outram, Q. (1990). The Appearance and
>Disappearance of Accounting: Wage Determination in the U.K. Coal Industry.
>Accounting, Organizations and Society, 149-170.
>
>Cullinan, C., Clark, M., & Knoblett, J. (1994). Accounting and Collective
>Bargaining: A Literature Review. Journal of Accounting Literature, 44-80.
>
>Lange Oskar. "From Accounting to Mathematics," in On the Economic Theory of
>Socialism by Oskar Lange and Fred M. Taylor. Edited by Benjamin E.
>Lippincott. New York: Augustus M. Kelly, 1970
>
>"No Escaping the Financial: The Economic Referent in South Africa"
>http://les.mcc.ac.uk/IPA/papers/cooper57.html
>
>"The Rhetoric of Accounting in Poland: Will the Expert be On Tap or On
>Top?" de la Rosa, Denise M. & Barbara D. Merino
>
>"Extending Practice: Accountants' Constructions of the Industrial Relations
>Arena in the U.S." Fogarty, Timothy, et.al.
>
>Regards,
>
>Tom Walker
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>Know Ware Communications
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