A serious work of Marxist economics – meeting on 11 July

First published: 9 July 2007

On 11 July there will be an opportunity to attend a meeting on a book summarising very serious work in Marxist economics – Andrew Kliman’s Reclaiming Marx’s Capital. The notice for the meeting is appended below, for those who wish to skip to it. But to understand its importance it is worth making some observations on the developments which led to it.

It is a truism of Marxism that theory has a relative autonomy from the direct development of the class struggle. Both parts of that phrase, the autonomy and that it is relative and not absolute, are important.

Marx’s economic writing towers over all other developments in the field not only its theoretical/logical development but above all in its scientific content – that is its factual ability to foresee what would happen (the ‘law of motion’ of society in Marx’s 19th century terminology). Ernest Mandel put this well in his introduction to the Penguin edition of the first volume of Marx’s Capital:

‘When Volume 1 of Capital was first published, capitalist industry, though predominant in a few Western European countries [and the US – SA Blog], still appeared as an isolated island encircled by a sea of independent farmers and handicraftsmen which covered the the whole world, including the greater part even of Europe. What Marx’s Capital explained, however, was above all the ruthless and irresistible impulse to growth which characterises production for private profit and the predominant use of profit for capital accumulation… contrary to a generally accepted belief, Marx is much more an economist of the twentieth century than of the nineteenth. Today’s Western world is much nearer to the “pure” model of Capital than was the world in which it was composed…

‘it would be very easy to “prove” Marx’s analysis to have been wrong, if experience had shown, for example that the more capitalist industry develops, the smaller and smaller the average factory becomes, the less it depends on new technology, the more its capital is supplied by the workers themselves, the more workers become owners of their factories, the less the part of wages taken by consumer goods becomes (and the greater becomes the part of wages used for buying the workers’ own means of production). If, in addition, there had been decades without economic fluctuations and a full-scale disappearance of trade unions and employers’ associations (all flowing from the disappearance of contradictions between Capital and Labour, inasmuch as workers increasingly became the controllers of their own means and conditions of production) then one could indeed say that Capital was so much rubbish and had dismally failed to predict what would happen in the real capitalist world a century after its publication. It is sufficient to compare the real history of the period since 1867 on the one hand with what Marx predicted it would be, and on the other with any such alternative “laws of motion”, to understand how remarkable indeed was Marx’s theoretical achievement and how strongly it stands up against the experimental test of history.’

The ultimate test of complexes of theories is their ability to predict the real world, not their logical coherence. It is well known, for example, that the theory of relativity and quantum mechanics are not compatible – this will doubtless be resolved at some point by someone developing a more profound theory that explains both, but nobody for that reason proposes to abandon probably the two most fundamental theories of modern physics. Even more strictly the proposed foundations of mathematics were known to lead to contradictions, that is paradoxes (Russel’s, Cantor’s etc), before Gödel proved definitively that no axiomatic theory capable of expressing elementary arithmetic can be both consistent and complete (which means that if it is consistent it will be incomplete and that if it is complete it will be inconsistent!). No one on that basis has, however, proposed to abandon mathematics.

A theory which predicts reality, but may be in contradiction with other theories or even to suffer from apparent or real internal contradictions, is therefore more scientific than a theory which is entirely logically consistent but unfortunately does not predict reality.

Nevertheless it is always valuable when claimed (or sometimes real) logical inconsistencies in a theory are sorted out. Ever since the publication in 1896 of Böhm-Bawerk’s Karl Marx and the Close of His System, it has been claimed that there is an inconsistency in Marx’s treatment of values and prices in Capital – the falsely named transformation problem. Among other things this particularly provided a basis from the 1970s, under the impact of defeats in the class struggle, for a series of previously Marxist economists to claim that this alleged inconsistency meant Marxism should be abandoned and what are generally known as ‘neo-Ricardian’ theories adopted – Ian Steedman’s Marx After Sraffa being a typical example of this.  Theoretical work undertaken from the 1970s by, in alphabetical order, Guglielmo Carchedi, John Ernst, Alan Freeman, Andrew Kliman, Eduardo Maldonado-Filho, Ted McGlone, Robin Murray, Nick Potts, Alejandro Ramos Martinez and others shows this is false and that Marx’s position is theoretically logically consistent.

This work, as its authors repeatedly point out, does not mean that Marx’s economics is correct – that, for exactly the reasons given above, depends on its ability to predict reality. But it does mean that the claim it should be abandoned as inconsistent is simply false. As such this is a contribution to Marxist theory of substantial significance and, morally, having been developed in a period of reaction in the class struggle of note. It is therefore of importance that one of the principal authors of this work, Andrew Kliman, is presenting his recently published book Reclaiming Marx’s Capital in London on 11 July.

Kliman does not correctly formulate one issue in his comments below. It is true that internal inconsistency is one of the principle pretexts offered for the suppression of Marx’s ideas. However this is not the cause of this censorship, which arises because it produces factual results that are unacceptable to capital as they remove its justification for existence. The advance or otherwise of Marx’s ideas will therefore ultimately depend on the class struggle.

However that does not detract from the very considerable theoretical contribution of Kliman and others who have exposed and refuted one of the main theoretical devices employed to secure the censorship of Marx’s ideas by those who devote themselves to such ends.

Socialist Action readers who are able to do so will find it valuable to attend and are urged to do so.

The notice of the meeting that has been issued follows.

‘On 11 July, a panel of scholars and political activists will convene in London to discuss Andrew Kliman’s new book, Reclaiming Marx’s ‘Capital’: A Refutation of the Myth of Inconsistency. The book claims to refute longstanding charges that Capital, Karl Marx’s major economic work, is internally inconsistent.

‘Speakers at the event include Martin Graham, a member of the Economic Committee of the Communist Party of Britain; Chris Harman, editor of the International Socialism journal; Michael Roberts, a columnist at marxist.com; Alan Freeman, an economist at the University of Greenwich; and David Black, an editor of the Marxist-Humanist journal Hobgoblin. Kliman, a professor of economics at Pace University in New York, will respond to their comments.

‘“What makes the myth of inconsistency important”, he said recently, “is that Marx’s theories couldn’t possibly be correct if they were actually inconsistent. Looking at the evidence, we might think, ‘Well, he offered cogent explanations of capitalism’s recurrent economic slumps, the perpetuation of unemployment, poverty, and inequality in the midst of great wealth’, and so forth. But we would just be deluding ourselves; internally inconsistent arguments simply can’t be right. So the myth of inconsistency has served as the main justification for the censorship of Marx’s critique of political economy and present-day research based upon it.

‘One argument of Marx’s that has been dismissed as inconsistent for more than a century is his theory that labour-saving technological progress tends to depress profitability and lead to economic crisis. Another is his theory that the exploitation of workers is the ultimate source of all profit, interest, dividends, and rent. In Reclaiming Marx’s ‘Capital’, Kliman notes that many Marxist economists have been among those who have charged that Marx was inconsistent. “This is a main reason why my book and its arguments are so controversial”, he stated recently.

‘The discussion of Reclaiming Marx’s ‘Capital’ will take place in Room B104 of the Brunei Galley, School of Oriental and African Studies (SOAS), near Russell Square, and begin at 6 pm. Copies of the book can be purchased at the event for £12, 1/3 off the list price.