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> On Apr 21, 2020, at 8:16 PM, Dayne Goodwin via Marxism > <marxism@lists.csbs.utah.edu> wrote: > > … MMT's apparent claim > that there is no relationship between the value of a currency and the labor > theory of value is valid. I don’t think any of the main MMT proponents holds that view. Here are the concluding paragraphs of Randy Wray’s paper, “Theories of Value and the Monetary Theory of Production,” in which he embraces and defends the labor theory of value: "It is frequently argued that the LTV is "metaphysical" (an argument also adopted by Robinson 1967, p. xi), or that one could just as well argue that capital produces all value, or that petrol does, and so on.31 This involves a fundamental misunderstanding of a monetary production economy. In an economy that is able to produce, and in which most production occurs on the basis of hiring labor at a money wage, wages are simultaneously the major cost of production and the source of the revenues that validate production. Labor simultaneously produces the physical output–but, more importantly, it sets in motion the monetary flows that are the purpose of production. Because the majority of worker income will be used to purchase the necessities of life, the wage bill returns as capitalist receipts, while the link between capitalist income and spending is different because the goal of capitalist activity is money and not necessities. In Kalecki's terminology, workers spend what they get and capitalists get what they spend; Marx's equivalent expression is "the part of the variable capital that A advances at any one time to his workers constantly flows back to him from the circulation sphere". (Marx Vol 2, p. 406). "There are other reasons why adoption of some other "factor" of production as the source of value would be mistaken. First, of course, there is the problem of adoption of a measure of value that is not itself a value. The separation of labor (not a value) from labor power (a commodity with value) provides the external measure of value. The problem with trying to use capital as the source of value is that it is itself a value, a value that depends on other values (for example, prospective profits); further, the heterogeneity problems with capital are surely much greater than those encountered in the case of labor. (Dobb 1945) Second, the focus on labor is consistent with the observation that it is obvious that man as a tool using animal manufactures instruments to increase control over nature. Third, the focus on labor and relations of production is consistent with the view of capitalist production as the product of relations of men with men. Value is not an attribute of things, but is a social relation between men. (Dobb 1945, p. 59) It should be noted, however, that no claim is made that other "factors of production" are not "productive" in a technical sense; even Marx argued that capital produces wealth. Nor is there any claim that embodied labor is the only thing commodities have in common. It is merely claimed that labor fulfills the requirements of a theory of value while other "factors" do not, and that the LTV is consistent with Keynes's analysis. "Similarly, the choice of the money-unit (wage unit) in Keynes's system is due to the prominent role given to liquidity preference and expectations. This in turn reflects a fundamental characteristic of a capitalist society in which the individual faces a type of uncertainty that is unique to an economy based on atomistic diffusion of decision making and individual responsibility for one's own welfare. This cannot be dismissed by handwaves about the "long run" or "fundamentals". In this sense, liquidity preference reflects social relations of production in a manner similar to but distinct from the way labor values reflect social relations in production.” Maybe it would be useful if people would offer source references for positions they attribute to “MMT,” rather than just pulling stuff out of the air. _________________________________________________________ Full posting guidelines at: http://www.marxmail.org/sub.htm Set your options at: https://lists.csbs.utah.edu/options/marxism/archive%40mail-archive.com
