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How the Labor Theory of Value Emerges from Egalitarianism

Published by Anonymous (not verified) on Sat, 11/09/2021 - 11:38pm in

… the value of a commodity is determined
by the quantity of labour spent on it …

Karl Marx

In the 1860s, Karl Marx declared that all value stemmed from labor. A century-long firestorm ensued.

On its own, Marx’s claim seems innocent enough. But what made it incendiary was how he used it. Starting from the idea that labor creates value, Marx built a seductive critique of capitalism. If workers alone create value, then capitalists are ultimately parasites — engorged ticks living off the blood of their unwitting hosts.

Marx’s arguments were impeccable and his theoretical edifice towering. But there’s just one problem. The whole thing was based on a foundation of quicksand.

Marx proclaimed that value is proportional to labor time. But he never bothered to check if this was correct. He simply defined it to be true, and got on building his theory of capitalism. Nor did Marx think about what his theory implied about human nature. If Marx’s theory is true, why do humans judge value in terms of labor time? Do we possess some universal value-judging faculty? If so, how did it evolve? Marxists rarely ask these questions, probably because the answers are uncomfortable.

When he wrote Capital, Marx thought he was making a seminal contribution to science. The reality is sadly different. While the ideological component of his work has thrived, the scientific component has withered. Beaten back by contradicting evidence, Marxists have largely abandoned the idea that the price of a commodity is proportional to labor time. What remains is a thin husk of Marx’s original theory.

To ‘validate’ the labor theory of value, Marxists now look not at commodities, but at vast chunks of the economy. There they find that monetary value correlates strongly with labor time. This correlation, Marxists claim, is robust evidence for the labor theory of value.

I argue that it is not.

The purpose of this essay is to put the last vestiges of the labor theory of value to rest. My goal is to explain why when we look at large sections of the economy, we find that value added correlates with labor time. The correlation comes not from some universal law of value. Instead, I argue that it results from a simple heuristic: humans seek income that is equivalent to their peers’. I call this principle the ‘egalitarian heuristic’. If it holds, even in rough form, then value added will correlate strongly with labor time. In short, we do not need the labor theory of value to explain the evidence.

In a sense, my argument is tragic because it brings us back to Marx’s starting point. Looking at human society through the lens of egalitarianism, Marx concluded that capitalism was unjust. But instead of admitting that this was a value judgment, Marx attempted to enshrine his values as an objective truth. By doing so, he used the cloak of science to create a rapturous ideology.

Marx’s armchair

Economists are often accused of doing armchair philosophy. From the comfort of their academic thrones, they postulate ideas about human behavior. But they don’t follow up with the grunt work of science — the messy business of testing ideas against real-world evidence.

The armchair method was pioneered by political economists like Adam Smith and David Ricardo. Both men claimed that prices were proportional to labor time. But neither economist bothered to check the data. When Marx began writing about political economy, he adopted the same armchair method (admittedly on a ‘throne’ that was less comfortable than Smith’s or Ricardo’s). In what would become his seminal work, Marx began Capital by reasserting Smith and Ricardo’s principle that value is proportional to labor time. And like these earlier thinkers, Marx provided no evidence that this claim was true. But what followed was entirely different.

Marx took the labor theory of value in an unanticipated direction, using it to create a devastating critique of both capitalism and of mainstream political economy. The results live with us today. While Smith and Ricardo are remembered as important thinkers, there are few self-professed ‘Smithian’ or ‘Ricardian’ economists. But there are plenty of economists who call themselves ‘Marxists’.

Ernest Mandel was one of them. A Holocaust survivor and Nazi resistance fighter, Mandel was a tireless advocate of Marxist principles. But while his life as an activist was exemplary, his work as a scientist was less so. The problem boils down to the armchair method. Is it okay to build a theory on a hypothesis that goes untested? Mandel seemed to think so. In fact, he celebrated it. The labor theory of value, he argued, was not a hypothesis. It was a definition:

For Marx, labour is value.

(Ernest Mandel, 1990; emphasis in original)

Other Marxists have come to similar conclusions. The economic historian (and self-professed Marxist) E.K. Hunt concludes that the labor theory of value is “not a theory in any usual sense”. It is a definition, plain and simple. And because it is a definition, Hunt argues, the labor theory of value can’t be evaluated in the normal way (say, by testing its assumptions). Instead, we must judge the theory by asking whether it gives ‘insight’ into the nature of capitalism:

[T]he labour theory’s scientific merit rests entirely on the usefulness of the insights gained by looking at capitalism in this [Marxist] way.

(E.K. Hunt, 1983)

Given this standard for ‘scientific merit’, Hunt argues that the labor theory of value is wildly successful:

[W]hile this conception of value is definitional, it represented, for Marx, a profound scientific discovery whereby one could go behind the superficial appearance of market exchange to discover the hidden essence of capitalism.

(E.K. Hunt, 1983)

Generations of Marxists have been hypnotized by this type of euphoric thinking. But there’s a glaring problem. If you don’t test your assumptions, how do you know if your theory gives ‘useful insights’?

And there’s the rub. E.K. Hunt is doing the Marxist equivalent of Milton Friedman’s ‘F-twist’. In an attempt to defend absurd neoclassical assumptions, Milton Friedman proclaimed that assumptions are irrelevant. If the theory is ‘useful’, Friedman argued, that’s good enough. The trouble is that ‘usefulness’ is in the eye of the beholder. In other words, it is a value judgment.

In this light, the labor theory of value is an exercise in circular values. Marx used anti-capitalist sentiment to define a theory of value that he then judged by the apparent ‘rigor’ it gave to his anti-capitalist sentiment. What Hunt and Mandel seem not to realize is that this is bad science. You cannot judge a hypothesis using the same criteria that were used to create it.

Why do Marxists always go up?

Misgivings aside, suppose that we accept Hunt’s claim that we can judge the labor theory of value based on the insight it gives into the ‘hidden essence of capitalism’. There is still a problem. Scientists are not allowed to put boundaries on how others should test their theory.

Imagine if after proposing his theory of gravity, Isaac Newton declared that it could only be tested using the orbit of Mars. If scientists had obeyed such a command, no one would have discovered that Newton’s theory failed for the planet Mercury. And without this well-known aberration, there would have been no motivation for a better theory. Hence, there would be no general relativity (and today, no debate over dark matter).

If we look carefully at Hunt’s words, we see that he is doing something similar to our counterfactual Newton: Hunt is defining the terms by which we are ‘allowed’ to test the labor theory of value. Unsurprisingly, those terms place the theory in a good light. The theory, Hunt claims, reveals the ‘hidden essence of capitalism’. And it is based ‘entirely’ on this insight that we are to judge the labor theory of value.

Fortunately (for critics like me), science does not work like that. Once a theory is proposed, other scientists can test it anyway they like. Sure, Marx took the labor theory of value ‘up’ to the nature of capitalism. But we can equally take it ‘down’ and see what it implies about human nature. The problem, though, is that taking the labor theory of value ‘down’ leads to uncomfortable questions.

Figure 1: Why must we take the labor theory of value ‘up’?

Marxists like E.K. Hunt argue that we should evaluate the labor theory of value based on the insight it gives into the ‘hidden essence of capitalism’. But we are not obliged to do so. We can also judge the labor theory of value by the insight it gives into human nature. The trouble is that doing so yields nonsense.

Suppose that Marx is correct, and that ‘value’ is universally proportional to labor time. How could this be?

After having admitted that the labor theory of value is based on a ‘definition’, Marxists are immediately in a tough spot. If this definition is arbitrary (as most definitions are), then the labor theory of value is not science … it is a branch of ethics. It represents Marx’s ethical claim about value, and nothing more. But if we admit this arbitrariness, then we admit that the labor theory of value says nothing about the ‘hidden essence of capitalism’. It merely tells us what we already knew: that based on his ethics, Marx thought capitalism was unjust.

The alternative is to claim that Marx’s ‘definition’ of value is not arbitrary, but instead reveals a ‘hidden essence’ of the human mind. That is a bold claim with bold consequences. It implies that all humans are somehow endowed with a ‘value-judging faculty’ that determines value by calculating the labor embodied in a commodity. Supposing this claim is true, many questions arise:

  1. Is the ‘value-judging faculty’ omnipotent? Is it the equivalent of the neoclassical agent with ‘perfect information’? If so, how do humans acquire this information?
  2. If the ‘value-judging faculty’ is not omnipotent, does it make mistakes? If so, are they pervasive enough to render the labor theory of value moot?
  3. How did the ‘value-judging faculty’ evolve? What evolutionary problem did it solve? How long has it been with us?
  4. Is the ‘value-judging faculty’ encoded at birth? Or is it a product of cultural evolution?
  5. If the ‘value-judging faculty’ is influenced by culture, do some cultures value labor differently than others? Do some cultures value things other than labor? If so, does this variation undermine the labor theory of value?
  6. Does the ‘value-judging faculty’ differ between people? If so, why?
  7. If the ‘value-judging faculty’ is universal, why do capitalists not seem to recognize it? Why don’t they ‘price’ wages using the same method that they price commodities?
  8. If some people (like capitalists) are able to ignore the ‘value-judging faculty’, does everyone have this ability? If so, when (if ever) is the labor theory of value valid?

Looking closely at these questions, they imply one of two things. Either the human mind is endowed with a remarkably uniform method for judging value, in which case the labor theory of value is a ‘law’ of human nature. Or the human mind does not come with such a faculty, in which case ‘value’ is a complex outcome of culture, and the labor theory of value is false.

We can see, then, why Marxists rarely take the labor theory of value in this direction. Doing so gives the wrong ‘insight’. But while Marxists avoid questions of human nature, a scientific theory of value cannot. That’s because any claim about how human’s judge ‘value’ is also a claim about human nature.

Marx’s mistake was to suppose that value is underwritten by some universal substance. It is not. Instead, what seems likely is that value is the outcome of a rough heuristic. The irony is that it is a heuristic that Marx himself used when formulating his theory. It is the heuristic of egalitarianism. Humans strive for income that is similar to their peers’.

Because this is a loose heuristic, it tells us virtually nothing about the price of individual commodities. But what it does tell us is that across large sections of society, monetary value ought to correlate with labor time. Yes, that is a rather weak claim. But it is the only remaining empirical claim that the labor theory of value makes.

Evidence for the labor theory of value

If the labor theory of value were true, one would expect a striking correlation between prices and labor time. The trouble is, this correlation has always been strikingly absent. Everywhere we look, we find exceptions.

Take art as an example. A painting that took a month to create might sell for $1000. Another month-long painting might sell for $1 million. And when artists die, the price of their art usually goes up, yet the work embodied in their paintings doesn’t change. And speaking of that, why does the price of high art fluctuate wildly with time? The painters are long dead, and the work embodied in their paintings is fixed for all time. What gives? We can dismiss these examples as ‘exceptions’ to the labor theory of value. But if we take that route, we quickly realize that the exception is the norm.

Realizing this problem, Marxists have largely given up trying to test Marx’s claim that commodity prices are proportional to labor time. Instead, they’ve switched to a far weaker test of the labor theory of value. Instead of looking at individual commodities, Marxists look at sectors of the economy.1 And there they find what they are looking for — a striking correlation between value added and labor time.

Figure 2 shows an example. I’ve plotted here the correlation between value added and employment across US sectors in 2020. Variation in sector employment explains about 70% of the variation in value added. This strong correlation holds in other years (in the US), and in other countries. It appears to give striking support for the labor theory of value.

Figure 2: Across US sectors, value added scales with the number of employees.

Note: Each point represents a US sector in 2020. [Sources and methods]

Bichler and Nitzan balk

Looking at the sector-level evidence for the labor theory of value, political economists Shimshon Bichler and Jonathan Nitzan are unimpressed. The problem, they point out, is that Marx stated that his theory of value applied not to sectors, but to individual commodities.

Now, if prices correlate with labor time at the commodity level, they will also correlate at the sector level. But what about the reverse? If prices correlate with labor time at the sector level, must they correlate at the commodity level?

The answer is no.

To illustrate why, Bichler and Nitzan construct a simple thought experiment, visualized in Figure 3. Imagine that at the commodity level, there is no correlation between prices and labor time. Panel A shows what this lack of correlation might look like (a blob of data with no trend). This commodity-level evidence spells trouble for the labor theory of value. Yet when we look at the sector-level data (Panel C), we find a striking correlation between monetary value and labor time. How can this be?

Figure 3: Bichler and Nitzan’s spurious correlation.

Note: Panel A plots the labor time and unit price of individual commodities. Since there is no correlation, at the commodity level the labor theory of value fails. Panel B shows sector size (the number of commodities in each sector) plotted against itself. The correlation is (obviously) perfect. When we multiply unit prices and unit prices by sector size, we suddenly get a strong correlation between monetary value and labor time (Panel C). But this results from autocorrelation — sector size correlating with itself. (You can download Bichler and Nitzan’s original presentation of this argument here.)

The answer to this apparent paradox is contained in Panel B. Here I’ve plotted a perfect correlation. It is perfect because it plots the same variable on both axes — the number of commodities produced by each sector. It is this autocorrelation that produces the trend between value added and labor time.

Here’s the math. To get the labor time within each sector, we multiply the number of commodities by the labor time per commodity. But the latter is just statistical noise:

\displaystyle \begin{aligned} \text{sector labor time} &= (\text{number of commodities}) \times (\text{labor time per commodity}) \\ \\ &= (\text{number of commodities}) \times \text{noise} \end{aligned}

Likewise, to get the monetary value of each sector, we multiply the number of commodities by commodity price. But the latter is just statistical noise:

\displaystyle \begin{aligned} \text{sector value} &= (\text{number of commodities}) \times (\text{commodity price}) \\ \\ &= (\text{number of commodities}) \times \text{noise} \end{aligned}

Notice what happens when we compare monetary value with labor time. We get a striking case of autocorrelation — the number of commodities correlated with itself:

\displaystyle \begin{aligned} \text{sector value} & \sim \text{sector labor time} \\ \\ (\text{number of commodities}) \times \text{noise} & \sim (\text{number of commodities}) \times \text{noise} \end{aligned}

The result, Bichler and Nitzan argue, is that testing the labor theory of value at the sector level tells us nothing about behavior at the commodity level — the level that Marx intended. Any correlation between sector value added and sector labor time could easily be spurious — the result of sector size correlating with itself.

Cockshott’s D-twist

Faced with Bichler and Nitzan’s critique, Marxist political economist Paul Cockshott (and colleagues) responded with an argument that I’ll call the ‘D-twist’. The only valid way to test the labor theory of value, Cockshott claims, is at the sector level. That’s because a commodity-level test violates the principles of ‘dimensional analysis’.

Cockshott’s thinking works as follows. When we compare things quantitatively, they must have the same dimension. This is a measurement truism. Cockshott’s D-twist is to claim that this truism makes it invalid to compare the prices (or labor times) of different commodities.

The reason, he argues, is that all prices come with a different dimension. The price of a pencil has dimensions of $/pencil. And the price of a shirt has dimensions of $/shirt. Faced with these different dimensions, we are not allowed to test the labor theory of value at the commodity level. Dimensions forbid it.

What Cockshott seems not to realize is that this argument does much more than he claims. If we accept his reasoning, it follows that the entire price system is dimensionally invalid. That’s because the purpose of prices is to compare them to other prices. It’s this relative value that gives prices meaning. But according to Cockshott, such a comparison is unsound. By the dictates of dimensional analysis, humans must only compare the prices of identical commodities.

Luckily, no one heeds Cockshott’s advice, because doing so would make prices meaningless. The whole point of prices is to compare the otherwise incommensurable. By virtue of having a price, non-identical commodities are reduced to an identical dimension: money. The purpose of a theory of value is to explain how this reduction happens.

In this light, Cockshott’s D-twist is self-refuting. Cockshott rescues the labor theory of value by arguing that the price system (which the labor theory of value tries to explain) is dimensionally invalid. In his attempt to save the bathwater, Cockshott kills the baby.2

Show me the third factor

After arguing for the ‘D-twist’, Cockshott and colleagues lay out their ground rules for debunking the sector-level evidence for the labor theory of value. If the correlation between labor time and value added is indeed spurious (as Bichler and Nitzan claim), then we must find a third factor that causes the correlation:

The argument that the correlations [between sectoral labor time and value added] are spurious depends on the idea that there exists an independent third factor that is the cause of concomitant variation in the persons and monetary flow vectors. … [F]or an allegation of spurious correlation to be borne out, one must both identify this third factor and show that it actually does induce the correlations observed. So what could this third factor be?

(Cockshott, Cottrell and Valle Baeza, 2014)

At first glance, Cockshott’s argument sounds reasonable. If the correlation between two variables is spurious, we should find the third factor that actually causes the correlation. The problem with this reasoning is that sometimes there is no single ‘third factor’. Instead, there are many ‘third factors’, each of which contributes partially to cause and affect.

Human height is a good example. Suppose that in an effort to explain human height, I measure differences in skeletal length. I find a striking correlation between individuals’ height and the length of their skeleton. I then claim to have explained human height.

You are unimpressed. You respond: ‘The height vs. skeletal-length correlation tells us nothing about why some people are taller than others. It simply restates the data it was given (human height), with some added noise.’

I retort: ‘If my correlation is meaningless, show me the third factor that causes height.’

If you accept my premise, you have lost the argument. That’s because there is no single factor that explains variation in height. Instead, height is a complex outcome of many factors (genes, nutrition, life history, etc.). The same principle is true of prices. Like human height, prices are caused by many different factors. As such, there is likely no ‘third factor’ that explains the correlation between value added and labor time.

On that front, Bichler and Nitzan’s example of ‘spurious correlation’ is a nice thought experiment. But Cockshott and colleagues correctly note that we cannot objectively measure the proposed ‘third factor’ — the quantity of commodities produced in each sector. (Doing so would require an objective dimension for aggregating the various commodities produced by each sector — a dimension that does not exist.)

Having shot down Bichler and Nitzan’s third factor, Cockshott concludes that we must accept the labor theory of value. The reason? Nothing measurable correlates more strongly with value added than does labor time. Case closed.

I don’t buy this argument. While there is no third factor that explains value added, there is a process that does. If we assume that humans are egalitarian, then a value-labor correlation is unavoidable, and the labor theory of value is unnecessary.

The egalitarian heuristic

Let’s assume that the labor theory of value is wrong. If so, why does value added correlate strongly with labor time. The answer, I propose, is because of human egalitarianism.

This idea may seem like a non-sequitur, and in some sense it is. It’s not obvious how humans’ desire for equality would produce a correlation between labor time and value added. But I’m going to show you that it can. The basic idea is that the desire for egalitarianism places (rough) limits on income. And these limits, in turn, put constraints on value added. The result is that unless humans live with oppressive inequality, value added will strongly correlate with labor time.

We’ll get to the math in a moment. But for now, let’s look at some examples of how egalitarianism relates to income. Suppose you hire your friend Alice to paint your house. The job will take about 1 month. How much would you offer to pay her?

Although in principle you could offer any amount, in practice you will not offer her $1 for the job. But why not? One reason is that $1 per month is a starvation wage. Since Alice is your friend, you don’t want her to starve. So you’ll offer her a living wage. I call this sentiment cooperative egalitarianism. When valuing a job done by someone you care about, you offer to pay a wage that is similar to your own.

What about when you buy things from a stranger? Then cooperative egalitarianism becomes less important. Most people won’t low-ball their friends. But many people will low-ball a stranger. Still, if you hire a stranger to paint your house, you’re unlikely to get someone to do it for $1. Why? Because of competitive egalitarianism.

If you ask a neoclassical economist, they’ll tell you that an unemployed person should take any job they can get, since some income is better than no income. But this is not how humans behave. If a job pays far below the social norm, many people will refuse to do it, even if doing so means earning nothing. That’s competitive egalitarianism. Its effect is to put a lower bound on income.

The same principles of cooperative and competitive egalitarianism put an upper limit on income. For instance, few people would offer to pay Alice (the painter) a wage that is hundreds of times their own. And if they did, they’d have a horde of painters at their door offering to do the job for a smaller (but still handsome) sum.

The effect of the egalitarian heuristic, then, is to put a loose bound on income. And this loose bound is all we need to get a strong correlation between value added and labor time.

Exchange without labor, prices without ‘value’

Having proposed the ‘egalitarian heuristic’, let’s look at some evidence of its use. The evidence described below is particularly relevant since it contradicts the labor theory of value.

According to the labor theory of value, monetary value is proportional to labor time. It follows that when people participate in an exchange that has no embodied labor, they ought to price it a zero. But it turns out that humans don’t behave this way. Instead, they use the egalitarian heuristic.

We know this because of a widely-studied scenario called ‘ultimatum game’. It works as follows. The game has two participants, who we’ll call Alice and Bob. To start the game, we give Alice a small sum of money (say $20). Then we ask her to split the money with Bob. Alice makes an offer, which Bob either accepts or rejects. If Bob accepts the offer, the split goes ahead and both participants keep the money. But if Bob rejects the offer, both participants get nothing.

Notice that in the ultimatum game, there is no exchange of labor. (Neither Alice nor Bob do any work.) Hence if both Alice and Bob adhere to the labor theory of value, Alice should offer Bob nothing. Why? Because she knows that Bob has done no labor, and hence, created no value. And Bob knows that he has done no work, and so accepts the offer of nothing.

Unfortunately, when real people play the ultimatum game, they don’t heed this prediction. Instead of offering nothing, the Alices offer the Bobs a (roughly) fair share of the pie. In other words, the participants follow the egalitarian heuristic.

Figure 4 shows the pattern. I’ve plotted here data from Joseph Henrich and colleagues’ seminal study of the ultimatum game. The horizontal axis shows the offer made by the Alices, expressed as a percentage of the original sum. The black points represent the average offer within different cultures. Unsurprisingly, there is variation across societies — an indication that culture affects how people judge value. More surprising is the fact that ultimatum offers clump tightly around an average value of about 40% (as illustrated by the blue density estimate).

Figure 4: Egalitarianism in the ultimatum game.

Note: The horizontal axis shows offers made by participants in the ultimatum game (the portion of the money the Alices offer to the Bobs). Black points show average offers made within different small-scale societies. The blue curve shows the density estimate. Data is from Joseph Henrich and colleague’s paper ‘Cooperation, Reciprocity and Punishment in Fifteen Small-scale Societies’.

This evidence illustrates the heuristic of ‘cooperative egalitarianism’. Given a sum of money, people offer to split it in a way that is (roughly) egalitarian. The fact that no labor has been done seems to be irrelevant.

Henrich and colleagues also found evidence for what I’ve called ‘competitive egalitarianism’. Every now and then, the Alices would lowball the Bobs, offering them less than 20% of the pie. When that happened, the Bobs rejected the offer about 40% of the time. In other words, these spiteful Bobs would rather take nothing than accept an offer they considered unfair. That’s competitive egalitarianism.

The simplest interpretation of this evidence is that humans don’t judge value based on labor time. Instead, they judge value based on the ethic of fairness.

Accounting for ‘value added’

With the human desire for equality in mind, let’s do some math. I’m going to explain how the tight correlation between value added and labor time can result from egalitarianism.

To make the case, we’ll start with the concept of ‘value added’ itself. The name suggests a contribution to society … as in ‘Bob added value’. That’s no coincidence. Mainstream economists conceive value added as exactly that — a measure of economic contribution. But beneath the sanguine name lies a more banal definition. Value added is really just net income.

‘Value added’ is defined as the difference between a firm’s sales and the expenses it pays to other firms. This is net income by another name. Once paid to the firm, this net income then gets split between the firm’s owners (capitalists) and the firm’s employees (laborers). So value added is the sum of two types of income:

\displaystyle \text{value added} = \text{labor income} + \text{capitalist income}

Mathematicians call this kind of equation an ‘identity’, because it is something we’ve defined to be true. It is the definition of value added.

Let’s use this identity to relate value added to labor time. To do so, we’ll split labor income into two components. Labor income is the product of labor time multiplied by the average wage. Noting this fact, we can rewrite our identity as:

\displaystyle \text{value added} = (\text{labor time}) \times (\text{average wage}) ~+~ (\text{capitalist income})

Using more compact notation, we can write:

\displaystyle  Y = L \cdot W + K

This identity tells us that value added (Y) is proportional to labor time (L), with some statistical ‘noise’ mixed in:

\displaystyle  Y = L + \text{noise}

The statistical ‘noise’ is produced by variation in wages (W) and capitalist income (K). In principle, the noise could be huge, and hence drown out the correlation between labor time and value added. But in practice, the noise is negligible. To see why, we must leave the realm of pure mathematics and look at the messy world of human behavior.

A strong signal with weak noise

In mathematical terms, the value-added identity remains valid no matter what numbers we throw in for L, W, or K. But in the real world, these numbers represent configurations of human societies. And human societies cannot take just any form.

Let’s start with labor time L. Interestingly, this is the most arbitrary number in the value-added identity. No, it’s not because human work is itself arbitrary. It’s because here we’re dealing with the labor time within economic sectors, and these sectors have arbitrary boundaries. Some sectors (like ‘wholesale trade’) contain many workers. Other sectors (like ‘pipeline transportation’) contain few workers. This size difference is an artifact of how the various sectors have been defined. But it has an important mathematical consequence — it ensures enormous variation in labor time between sectors.

This labor-time variation is our ‘signal’. It is what will produce the correlation between value added and labor time. But this signal is corrupted by ‘noise’ caused by variation in wages and capitalist income. If the signal is to get through, the noise must be small.

What is key is that this noise is produced by variation in income. And this income variation, in turn, is limited by the human desire for equality. With the US as our example, let’s have a look at this egalitarian heuristic.

The egalitarian heuristic among US workers

In the United States, there is tremendous wage inequality. Superstar employees (such as CEOs) can earn hundreds of times more than minimum-wage workers. But when it comes to the value-added identity (below), it’s not wage differences between individuals that matters. What we care about is wage variation between sectors. That’s what W represents:

\displaystyle  Y = L \cdot W + K

This sector variation in wages turns out to be rather small. Figure 5 tells the story. Here I’ve taken the average wage in each US sector (the annual income of a full-time-equivalent employee). Then I’ve calculated the Gini index of these average wages, and plotted the trend over time. Over the last two decades, wage inequality between sectors had an average Gini index of 0.25. On the spectrum of conceivable inequality, that’s quite low.

Figure 5: Wage inequality between US Sectors.

Note: I have plotted here the Gini index of wage inequality between US sectors. To calculate this index, I input into the Gini formula the average wage in each sector. Inter-sector wage inequality has increased slightly since 1998, but remains low when judged on the 0–1 scale of possible inequality. [Sources and methods]

Returning to our value-added identity, wage inequality between sectors creates noise in the value-labor relation. But in the US, this noise is small.

In other countries, could the wage noise be slightly larger? Almost certainly. But could it be significantly large? That’s doubtful. Given the human desire for income parity, it is extremely difficult to maintain huge wage differences between sectors. Doing so would require barring low-wage workers from moving to high-wage sectors. To some extent, trade guilds create such a barrier. Apartheid regimes do it even better. But unless there is an armed barrier between sectors (i.e. a state border), people will move where the money is, and thus limit inequality. That’s the principle of competitive egalitarianism.

The egalitarian heuristic between US workers and capitalists

When Marx wrote Capital his goal was to explain capitalist income. More specifically, he wanted to explain the capitalist share of income, which he argued was the outcome of class struggle.

Here, I think Marx was on the right track. Unfortunately, he was mute on how this class struggle should play out, other than to claim that it would culminate in the overthrow of capitalism. In most cases, that prediction didn’t pan out. Instead, capitalism has persisted, as has the capitalist share of income.

In the US, for instance, the capitalist share of income has fluctuated between about 5% and 20% of national income (Figure 6). Admittedly, these fluctuations have corresponded to seismic shifts in society. But at least in principle, we can imagine the fluctuations being much larger. There’s no mathematical law that forbids capitalists from taking 90% of income. And yet capitalists seem to take only a small minority of the pie. Why? Marx gives us no answers. But the egalitarian heuristic offers a clue.

Figure 6: Capitalist share of US national income.

Note: The capitalist income share is the sum of before-tax profits and net interest, expressed as a fraction of national income. [Sources and methods]

A defining feature of stratified societies is that there are far fewer elites than there are commoners. The exact ratio is a matter of debate. But in modern societies, capitalist elites makeup about 1% of the population.3 Let’s take this number and see what it implies about individual income.

The income of the average capitalist is proportional to the capitalist share of income (K/Y), divided by the portion of the population who are capitalsts (1%):

\displaystyle \text{average capitalist income} \propto \frac{K/Y}{0.01}

Likewise, the income of the average worker is the labor share of income (1 - K/Y) divided by the portion of the population who are workers (99%):

\displaystyle \text{average worker income} \propto \frac{1 - K/Y}{0.99}

Putting the two equations together, we can see that the capitalist share of income affects inequality between capitalists and workers. For example, if the capitalist share of income is 2%, the average capitalist earns about 2 times more than the average worker. But if the capitalist share of income is 20%, the average capitalist earns about 25 times more than the average worker.

In Figure 7, I’ve plugged these values into the Gini index to illustrate how capitalist-vs-worker inequality varies with the capitalist share of income.4 What’s interesting is that the trend is extremely non-linear. Almost all of the inequality action happens when the capitalist share of income is below 20% — a region I’ve dubbed the ‘class struggle sweet spot’.

Figure 7: The class struggle sweet spot.

Note: This figure plots a model in which I assume that capitalist income flows exclusively to the top 1%. I then measure how the capitalist share of income (horizontal axis) affects inequality between the average income of capitalists and the average income of workers (vertical axis). The vast majority of the inequality action occurs when the capitalist share of income is below 20%, a region I’ve dubbed the ‘class struggle sweet spot’. [Sources and methods]

This simple model gives a plausible reason why the capitalist share of US income has never exceeded 20%. If workers desire equality between themselves and their capitalist peers, then the battle is to keep the capitalist income share below 20% — and preferably much lower. So while the capitalist share of income could (in principle) be anything, in practice, the human desire for egalitarianism limits the capitalist share of the pie to a small minority.

Back to our value-added identity:

\displaystyle  Y = L \cdot W + K

Although the identity is true for all conceivable values of capitalist income K, only a tiny subset of these values describe real-world societies. In practice, societies restrict capitalist income so that it constitutes a small portion of total income, Y. And this restriction, in turn, limits the amount of statistical noise between labor time and value added.

The egalitarian heuristic among US capitalists

In Capital, Marx’s favorite character is a fellow named ‘Mr. Moneybags’. He is Marx’s caricature of the money-grubbing capitalist who cares only for profits. This satire has a strong element of truth. The capitalists of Marx’s day (the Vanderbilts, Rockefellers, and Carnegies) did not have a reputation for being generous to workers. Nor, for that matter, do the capitalists of today. So it would seem a bit crass to argue that capitalists (then and now) follow the egalitarian heuristic. But that is exactly what I’ll claim.

The key is that the egalitarian heuristic has two sides: a cooperative side and a competitive side. Most capitalists suppress the cooperative side, at least when it comes to solidarity with workers. But all capitalists vehemently believe in competitive egalitarianism. Indeed, it is the core of their ideology. Capitalists’ goal, Jonathan Nitzan and Shimshon Bichler observe, is to meet (or beat) the normal rate of return. In other words, capitalists want a return that is similar to their peers. That’s competitive egalitarianism.

With this egalitarianism in mind, let’s return to our value added identity:

\displaystyle  Y = L \cdot W + K

We’ve already seen that capitalist income K is restricted so that the capitalist share of total income is fairly small. The principle of competitive egalitarianism further restricts this income. Because capitalists try to meet or beat the normal rate of return, the capitalist share of income tends to be quite uniform across sectors.

Figure 8 tells the story. I plot here the results of a 2-step analysis. I first calculate the capitalist share of income (K/Y) in each US sector. I then plug this capitalist income share into the Gini index, and plot its inequality over time. Since 1998, the Gini index has averaged about 0.3. In other words, capitalist margins are fairly equal across sectors.

Figure 8: Inequality of capitalist income share between US sectors.

Note: This figure plots results from a 2-step calculation. In step 1, I measure the capitalist share of value added (K/Y) in each US sector. In step 2, I calculate the Gini index of this income share across all sectors. [Sources and methods]

The effect of this capitalist-income-share equality is to limit noise in our value-added identity. Yes, capitalist income could conceivably be anything. But in practice it is not. The capitalist share of total income tends to be below 20%. And this income share does not vary much between sectors.

From egalitarianism comes a value-labor correlation

We’re now ready to explain the tight correlation between value added and labor time. Marxists argue that this correlation is strong evidence for the labor theory of value. I propose that the correlation stems purely from the egalitarian heuristic.

To test the latter idea, I’m going to throw random numbers into the value-added identity. Then I’ll discard outcomes that are inconsistent with egalitarianism (as we observe it in the United States). I call this thought experiment the ‘random-egalitarian model’.

I’ve explained the model in detail in Box 1. But here’s a quick summary. I start by taking real-world labor times (the sector labor times observed in the US) and putting these numbers into the value-added identity. Then I input random numbers for wages and capitalist income. Next, I look at the distribution of income that results, and discard outcomes that look nothing like the real world. Finally, I measure the correlation between value added and labor time and see what I find.

Box 1: The random-egalitarian model

Randomly generated societies, selected for egalitarianism

  1. Start with the value-added identity, which relates value add (Y), labor time (L), wages (W) and capitalist income (K). We’ll apply it to each sector s:

\displaystyle  Y_s = L_s \cdot W_s + K_s

  1. Into Ls, input the actual labor times worked in US sectors in 2020. I measure labor time in terms of the number of full-time-equivalent employees, as shown in Figure 2;
  2. Generate random numbers for sector wages Ws and capitalist income Ks. (For details about the generation method, see Sources and methods);
  3. Discard (as follows) outcomes that violate the egalitarian heuristic:
    • Discard outcomes in which between-sector wage inequality exceeds a Gini index of 0.3 (the US maximum in Fig. 5);
    • Discard outcomes in which the society-wide capitalist share of income (\sum K_s /\sum Y_s ) is greater than 20% (the US maximum in Fig. 6);
    • Discard outcomes in which the capitalist income share (Ks/Ys) has a between-sector Gini index greater than 0.5 (the US maximum in Fig. 8);
  4. For the societies that remain, measure the sector correlation between value added and labor: Ys ~ Ls.

The results of the random-egalitarian model are shown in Figure 9. Let’s break down what you see. I’ve plotted here the outcome of a 2-step calculation. I first measure the sector correlation between value added and labor time in both the random-egalitarian model and the real-world US. The resulting correlation varies over time (in the US) and over different iterations (in the model). Then I take this correlation and plot its histogram, shown in blue for the US and red for the random-egalitarian model.

You can see that on average, the random-egalitarian model produces a value-labor correlation that is stronger than the one found in the United States. And it does so without a labor theory of value. It is merely randomness, selected for egalitarianism.

Figure 9: Randomness, selected for egalitarianism, creates a value-labor correlation.

Note: This figure visualizes a thought experiment in which I test if egalitarianism can create a value-labor correlation. The red histogram shows the results of a model in which I put random numbers into the value-added identity, and then discard outcomes that are non-egalitarian. (See Box 1 for details.) I’ve plotted here the distribution of correlation coefficients for the relation \log Y_s \sim \log L_s (the sector correlation between the log of value added and the log of labor time). The blue histogram shows the distribution of US values over the last two decades. The red histogram shows the correlation distribution in my random-egalitarian model. [Sources and methods]

This result does not bode well for devout Marxists. Contrary to what they claim, the strong correlation between value added and labor time may not be evidence for the labor theory of value. Instead, it could be evidence for a more fundamental feature of human nature: the desire for equality.

If we restrict inequality to a range found in the real world, then otherwise purely random numbers will generate a value-labor correlation … and a strong one at that. The idea that labor creates value is unnecessary.

Selecting against the labor theory of value

Having shown that when we select for equality, a value-labor correlation emerges, let’s now do the opposite. Let’s select for no value-labor correlation and see what happens to inequality. I call this thought experiment the ‘random-anti-Marx’ model. It is ‘anti-Marx’ because in the hypothetical societies that remain, the labor theory of value is overwhelmingly contradicted by evidence.

The random-anti-Marx model starts the same way as the random-egalitarian model. We take our value-added identity and input real-world values for labor time. Then we throw in random numbers for wages and capitalist income. Finally, we select outcomes where value added does not correlate with labor time. Box 2 outlines the steps.

Box 2: The random-anti-Marx model

Random societies, selected so that value added does not correlate with labor time

Repeat steps 1–3 from Box 1.

  1. Measure the correlation (r) between sector value added and sector labor time (r= \log Y_s \sim \log L_s) ;
  2. Discard (as follows) outcomes in which value added correlates with labor time:
    • Discard outcomes where |r| > 0.01 ;
    • Discard outcomes where the correlation p-values are less than 0.5;
  3. Observe inequality in the societies that remain.

The point of the random-anti-Marx model is to generate counterfactual societies that do not exist and will never exist. At first, this goal sounds odd. Why would we want to simulate societies that have nothing to do with reality? Because doing so helps us understand why these societies don’t exist.

Think of it as the Sherlock Holmes principle. One way to understand the path taken is to rule out the paths that were avoided:

When you have eliminated the impossible, whatever remains, however improbable, must be the truth.

The random-anti-Marx model gives clear reasons why we always find a value-labor correlation. To understand why, let’s return to our value-added identity:

\displaystyle  Y = L \cdot W + K

The question we’re asking is — under what conditions will value added (Y) not correlate with labor time (L)? The mathematical conditions are simple: the ‘signal’ must be drowned out by the ‘noise’.

In our value-added identity, the ‘signal’ is the variation in L (here taken to be variation in the labor time between sectors). The ‘noise’ is the variation in wages (W) and capitalist income (K). As we dial up this noise, we remove the correlation between labor time and value added.5

The purpose of the random-anti-Marx model is to reveal what it takes for value added to be utterly uncorrelated with labor time. The requirements, it turns out, are rather bizarre. I’ll divide them into two scenarios, shown in Box 3.

Box 3: Scenarios in which sector value added does not correlate with labor time.

The fat-capitalist/starving-capitalist scenario:

  • There is no value-labor correlation, but wage variation is in a normal range. (Condition: wage inequality between sectors has a Gini index less than 0.3.)

The fat-worker/starving-worker scenario:

  • There is no value-labor correlation, but capitalist income is in a normal range. (Conditions: the capitalist share of total income is less than 20%, and the capitalist income share has a between-sector Gini index less than 0.5.)

The fat-capitalist/starving-capitalist scenario

In the fat-capitalist/starving-capitalist scenario, there is no value-labor correlation, but wage variation between sectors is ‘normal’ (meaning it is not more extreme than found in the US). By selecting for these conditions, we create a distribution of capitalist income that is bizarre.

Figure 10 shows what these imaginary societies look like. I’ve plotted here the distribution of the capitalist share of income by sector. The blue histogram is actual US data, which has a familiar bell-curve shape. Capitalist margins clump around an average value of about 15%. In contrast, when we select for a lack of value-labor correlation (alongside a realistic wage distribution), we get a strikingly different pattern. The resulting societies (shown in red) have essentially two types of sectors:

  1. A ‘fat-capitalist’ sector where capitalist margins verge on 100%;
  2. A ‘starving-capitalist’ sector where capitalist margins verge on 0%.

Figure 10: Selecting against a value-labor correlation creates a fat-capitalist/starving-capitalist system.

Note: The blue and red histograms plot the distribution of the capitalist share of income by sector (K_s/Y_s) . The blue histogram shows actual US values over the last 2 decades. The red histogram shows what happens when we select for societies that lack a value-labor correlation, but have wage inequality within normal bounds. [Sources and methods]

The results in Figure 10 tell us why value-added always correlates with labor time: because to imagine otherwise is unthinkable. Killing the correlation between value added and labor time (while keeping a realistic wage distribution) requires a fat-capitalist/starving-capitalist system of income. But such a system violates everything we know about human behavior. It requires that starving capitalists remain idle while their peers reap vast riches.

This scenario is like imagining a herd of cows in which one group is content to starve while the other group gorges itself. Such cows do not exist. And neither do such humans.

The fat-worker/starving-worker scenario

In the alternative scenario, we select for no value-labor correlation, but keep only the societies with a realistic distribution of capitalist income. When we do so, we produce societies with wage inequality that is obscene. Figure 11 runs the numbers.

I’ve plotted here the results of a two-step calculation. I first take average wages in each sector and measure their inequality using the Gini index. Then I plot the distribution of this Gini index. The blue histogram shows the results for the US over the last two decades. Between-sector wage inequality clumps tightly around a Gini index of 0.25.

In contrast, when we kill the value-labor correlation (but keep capitalist income in a realistic range), the resulting wage inequality is extreme (red histogram). The Gini index averages 0.98.

Figure 11: Selecting against a value-labor correlation creates extreme wage inequality.

Note: The histograms plot the distribution of wage inequality between sectors. The blue histogram shows actual US values over the last 2 decades. The red histogram shows what happens when we select for societies that lack a value-labor correlation, but have capitalist income within normal bounds. [Sources and methods]

Again, this result tells us why value-added always correlates with labor time: to imagine otherwise is unthinkable. The fat-worker/starving-worker scenario kills the value-labor correlation by making wage inequality more extreme than anything found in the real world.

To give you some context, the most unequal societies on Earth — places like Botswana and Swaziland — approach a Gini index of 0.8. But this is for individual income, not sector averages. Achieving comparable inequality across sectors would mean having a sector of paupers living next to a sector of billionaires. Humans do not tolerate such inequality. And that’s why value added always correlates with labor time.

The tragedy of Marxism

Let’s review. With 150 years of hindsight, it seems clear that Marx’s contribution to science has been largely tragic. The problem is that Marx had two sides, one of which undermined the other.

On the one hand, Marx was an unrivalled empiricist. He was an astute observer of capitalism and a lucid documenter of its abuses and inequalities. And after a decade spent in the British Museum Library, he was a wise (and often riveting) historian. Marx the empiricist made seminal contributions to science.

On the other hand, Marx was also a theorist. It’s here that his work was disastrous. Yes, Marx was wrong … but that’s not the real problem. (Being wrong is part of science.) Marx’s problem was that he framed his ideas in a way that couldn’t be wrong. From the get-go, Marx’s conclusions about capitalism were so seductive that he and his followers forgot to (and often refused to) test their premise.

Marx looked at capitalism and saw a system that, in his eyes, was unjust. Then he took this ethical judgment and encoded it in a theory of value. The result was a seemingly objective way to show that capitalists exploited workers. But it all hinged on a leap of faith — the assertion that labor is value.

In a way, Marx was too clever for his own good. On top of his simplistic assertion about value, he built a towering theoretical edifice that he then wielded to great effect. Marx’s followers took up the mantle and became ‘lords of the labyrinth’6 — masters of wielding Marxist theory without ever questioning its foundation.

When the philosopher Karl Popper looked at the state of affairs in the mid-20th century, he was not impressed. Marxists, he noted, were able to explain anything and everything:

A Marxist could not open a newspaper without finding on every page confirming evidence for his interpretation of history;

… Whatever happened always confirmed [Marxist theory]. Thus its truth appeared manifest; and unbelievers were clearly people who did not want to see the manifest truth …

(Karl Popper, 1953)

Popper’s insight was to turn this triumphant attitude on its head. When your theory can accommodate any type of evidence, that’s not a strength. For Popper, it’s a sign that your theory is pseudoscience.

To be fair to Marx, we should distinguish between his theoretical edifice and the foundation on which it rests. The edifice, described by Popper, came to be known as ‘historical materialism’. It’s an approach to understanding history that is so sweeping that it can accommodate almost any sort of facts. At the core of Marx’s theory, though, is a very simple hypothesis about human behavior: we judge value in terms of embodied labor. This hypothesis is easily tested. The problem is that it is immediately falsified.

The funny thing about theories of value is that if you proclaim them ‘universal’, any opposition disproves your point. If labor was the sole source of value, then the labor theory of value should be uncontested. Everyone would agree that labor time is how they judge value. But everyone does not agree. Real-world humans, it seems, judge ‘value’ using many different dimensions. So the labor theory of value appears to be obviously false.

Faced with this glaring problem, Marx had a clever response. Yes, Marx admitted, some people may not equate value with labor. But this fact does not falsify the labor theory of value. It falsifies people’s consciousness. In other words, if you claim to judge value other than by labor time, you’re fooling yourself — you have a ‘false consciousness’.

What Marx seemed to forget is that such a bold claim should be backed by extraordinaire evidence. It’s true that human ideas can be ‘false’. (If I believe that the Earth is flat, I’m wrong.) But what does it mean for human values to be false? If I claim to value trees because they provide shade (not because they have embodied labor), what evidence would prove me wrong? Here we enter the quicksand of human psychology. The thing about values is that there is no external standard for judging them. The mere fact of holding a value makes it true for the person who holds it. Such is the power of ideas.

From the beginning, then, the labor theory of value made nonsensical claims about human psychology. Marxists, however, were undeterred. That’s because they weren’t concerned with understanding the behavior of individuals. They wanted to understand capitalism’s ‘laws of motion’. The tragedy here is that Marx’s rich empiricism could have given rise to a flourishing interplay between evidence and ideas. But that did not happen. Enamoured by Marx’s conclusions about capitalism, his followers decided that the core of Marx’s theory was not a hypothesis. It was a dogma. The task was then to find evidence that supported the conclusion.

It’s in this light that we should interpret the correlation between value added and labor time. Yes, this evidence is consistent with the labor theory of value. But it is also consistent with a much broader theory of human behavior. If humans have evolved to be egalitarian, then a correlation between monetary value and labor time is nearly unavoidable. Indeed, to create a society that lacks a value-labor correlation requires preposterous inequality.

The irony here is that in his writings, Marx clearly espoused the ethic of egalitarianism. The tragedy is that he cloaked this ethic in the facade of objective truth. We are still paying the price for his mistake.

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Sources and methods

Data for the ultimatum game (Fig. 4) is from Joseph Henrich and colleague’s paper ‘Cooperation, Reciprocity and Punishment in Fifteen Small-scale Societies’.

US income data comes from the BEA, using the tables shown below. I have defined ‘sectors’ to be the smallest unit with available data.

  • average wage by sector: Table 6.6D (annual income per full-time-equivalent worker)
  • full-time-equivalent employees by sector: Table 6.5D
  • value added by sector: Table: Value Added by Industry
  • capitalist share of national income: Table 1.12. (Capitalist income is the sum of net profits and corporate profits before tax.)
  • capitalist income by sector. Net interest data is from Table 6.15D. Corporate profit data is from Table 6.17D. The caveat here is that net interest is reported with less detail (fewer subsectors) than other forms of income. The result is that we know the distribution of capitalist income across sectors with less detail than we know the distribution of value added.

Generating random societies

My simulation assumes that sector value added Y_s is given by the identity:

\displaystyle  Y_s = L_s \cdot W_s + K_s

Sector labor time L_s equals the full-time-equivalent employment in US sectors in 2020.

I assume that sector average wages W_s and sector capitalist income K_s are random numbers that follow a lognormal distribution, dictated by the scale parameter \mu and the shape parameter \sigma :

\displaystyle  W_s \sim \text{lognormal} (\mu_W, \sigma_W)

\displaystyle  K_s \sim \text{lognormal} (\mu_K, \sigma_K)

I let \mu vary uniformly between -10 and 10. I let \sigma vary uniformly between 0 and 10.

For each iteration of the simulation, I select \mu_W , \mu_K , \sigma_W , and \sigma_K independently from a uniform distribution. I use these parameters to generate random values for W_s and K_s , which I then enter into the value-added identity. The result is simulated value added in each sector of the hypothetical society.

I repeat the simulation millions of times, after which I apply the selection criteria outlined in Box 1 an Box 2.


  1. Anwar Shaihk pioneered the method of using input-output tables to measure the total embodied labor used by each sector. Unfortunately, the complication (pointed out by Bichler and Nitzan) is that input-output tables report the flow of money. So to estimate labor time, you must convert monetary flows to labor flows. The problem is that labor time is supposed to predict monetary value, so it would seem invalid to use the latter to estimate the former.↩
  2. We can also use Cockshott’s dimensional reasoning to ‘invalidate’ physics. According to Einstein, energy and mass are related by the equation E=mc^2 . Imagine that we test this equation by converting different items (cars, pencils, houses, etc.) into pure energy. To see if Einstein’s equation holds, we then compare the change in mass against the change in energy. Lo and behold, the data checks out. Einstein’s equation is correct.

    Using Cockshott’s reasoning, however, we can argue that the experiment is invalid. Why? Because we are not minding our dimensions. The different objects we annihilate (cars, pencils, houses, etc.) have different dimensions, meaning any comparison of their mass or energy is invalid.

    The reality is that like prices, the whole point of mass and energy is to compare the otherwise incomparable. So if we accept Cockshott’s dimensional argument, we break physics.↩

  3. The exact number of ‘capitalists’ depends on how we define ‘capitalist income’. Should it include proprietors who are self employed? What about small-scale landlords who earn rent? I follow Nitzan and Bichler in defining ‘capitalist income’ narrowly as the sum of interest and corporate profits. Using this definition, the evidence suggests that virtually all capitalist income goes to the top 1%. For details, see ‘How the Rich Are Different’.↩
  4. To calculate inequality between workers and capitalists, I use the ‘adjusted’ Gini index, which accounts for small sample size. If the Gini index is G , the adjusted Gini index divides by the maximum possible Gini for the given sample size n:

    \displaystyle  G_A = \frac{G}{G_n^{max}}

    In the case of inequality between capitalists and workers, the sample size is n=2 , giving a maximum possible Gini index G_n^{max} = 0.5 .↩

  5. Interestingly, the interplay between signal and noise tells us why Marxists test the labor theory of value at the sector level. One way to counteract the statistical noise is to dial up the signal — variation in L. You do that by looking at swaths of the economy containing vastly different numbers of people. The greater the differences in sector size, the greater your ‘signal’, and hence, the stronger the correlation between value added and labor time.

    In contrast, when you look only at consumer commodities, variation in the embodied labor time is small. Because the ‘signal’ is weak, it is easy to drown out. That’s why Marxists have given up testing the labor theory of value at the commodity level. They don’t get the evidence they want.

    One way to counteract the signal-noise problem would be to redefine what you mean by a ‘commodity’. To most people, a ‘commodity’ is something small — shoes, shirts, cars, etc. If you want to dial up the labor-time signal, you could expand the concept of the ‘commodity’ to include big infrastructure projects — factories, power plants, roads, etc. By doing so you’d guarantee a price-labor correlation. You’d find that thermo-nuclear power plants are far more costly than pencils, and take far more labor. And by demonstrating this correlation, you would surprise nobody.↩

  6. ‘Lord of the labyrinth’ is linguist Rudolf Botha’s characterization not of Marx, but of Noam Chomsky. Anthropologist Chris Knight observes:

    Botha pictures Chomsky as a skilled fighter at the centre of a vast intellectual labyrinth whose forks and hidden pitfalls are used aggressively to defeat anyone foolish enough to intrude. Nobody ever wins in a battle with ‘the Lord of the Labyrinth’, because the Master makes sure that each contest will take place on terrain which he himself has landscaped and designed.

    (Chris Knight, 2016)

    Marx constructed a similar labyrinth. The best way to critique it is by not entering.↩

Further reading

Cockshott, P., Bichler, S., & Nitzan, J. (2010). Testing the labour theory of value: An exchange.

Cockshott, P., Cottrell, A., & Valle Baeza, A. (2014). The empirics of the labour theory of value: Reply to Nitzan and Bichler. Investigación Económica, 73(287), 115–134.

Fix, B. (2020). How the rich are different: Hierarchical power as the basis of income size and class. Journal of Computational Social Science, 1–52.

Henrich, J., Boyd, R., Bowles, S., Camerer, C., Fehr, E., Gintis, H., & McElreath, R. (2001). In search of homo economicus: Behavioral experiments in 15 small-scale societies. American Economic Review, 91(2), 73–78.

Henrich, J., Boyd, R., Bowles, S., Camerer, C., Fehr, E., Gintis, H., … others. (2001). Cooperation, reciprocity and punishment in fifteen small-scale societies. SFI Working Papers, (2001-01-007), 1–9.

Hunt, E. K. (1983). Joan Robinson and the labour theory of value. Cambridge Journal of Economics, 7(3/4), 331–342.

Knight, C. (2016). Decoding Chomsky: Science and revolutionary politics. Yale University Press.

Nitzan, J., & Bichler, S. (2009). Capital as power: A study of order and creorder. New York: Routledge.

Popper, K. (1953). Science: Conjectures and refutations. Philosophy of Science, 104–110.

Shaikh, A. M. (1998). The empirical strength of the labour theory of value. In Marxian economics: A reappraisal (pp. 225–251). Springer.

The post How the Labor Theory of Value Emerges from Egalitarianism appeared first on Economics from the Top Down.

How to Think Like a Gramscian Historian, as Inspired By Stuart Hall

Published by Anonymous (not verified) on Mon, 06/09/2021 - 2:30am in




US Intellectual History Blog

FEB 20, 2014

Thinking Like a Gramscian Historian: An Introduction, a Provocation, and Guide to the Basics

What follows is a guide and provocation—not a formula—for writing as a mature, unorthodox Marxist historian. By the latter I mean as a “Gramscian Historian,” or perhaps something like a Critical Theorist historian. As the points below accumulate, moreover, you might see this as a guide to thinking like a Gramscian Intellectual Historian. We’ll see. [Note: This could be read as a companion to Kurt Newman’s November 19, 2013 post on Gramsci.]

The deeper I delve into the darkest corners of my theoretical self (an ongoing preoccupation over the past year, by choice and accident), I’m seeing myself as a someone who could get comfortable writing in a Critical Theorist-Gramscian historical mode of analysis. By this I do not mean using that mode to direct my selection of evidence, guide all of my interpretive decisions, or to depart from a factually rich style of writing (hopefully that sense of self will be confirmed as reviews of my book begin to appear). Rather, in a fashion true to the historicism of Max Horkheimer and the concreteness of Antonio Gramsci, I mean using that mode to help one make sense of the abstractions, generalizations, and inductions that arise from a deep immersion in evidence. A Gramscian-Critical Theorist mode of analysis is another important tool in my box of interpretive tools.

The immediate inspiration for this post is the death of Stuart Hall, but through a recommendation by James Livingston. When Jim posted a reflection about Hall on his Facebook page, he included a reference to Stuart Hall’s 1986 article “Gramsci’s Relevance for the Study of Race and Ethnicity” (Journal of Communication Inquiry, vol. 10, no. 5, pp. 5-27). I would’ve never noticed this without Jim’s shout-out, which included this marketing tag: “The best single piece on Gramsci I have ever read is not by Cammett or Genovese, or Nairn or Anderson, or, for that matter, Laclau and Mouffe, but by Hall, in the Journal of Communications Inquiry.” That is no small praise. I bought Livingston’s pitch, and this post is the result.

Almost everything in the outline, or program, below derives from the Hall article. That piece, in turn (which sadly contains no bibliography), relies primarily on Gramsci’s Prison Notebooks. But Hall also references a number of other pieces that may (I’m not sure) exist outside the Notebooks. Finally, in a bibliography afterwards I cite some other potentially useful secondary sources.

How to Think Like a Gramscian Historian, as Inspired By Stuart Hall

Note: All page references are to the Hall article. Other sources are sprinkled throughout.

1. Like any good orthodox Marxist—as distinct from a unorthodox Marxist thinker like Gramsci—you must still know and understand the economic terrain/base. This means thinking about the period, particulars, and specifics of capital and labor. Be sensitive to communities and various regional differences. This is what helps make your historical thinking historicist. This means knowing both qualitative and quantitative data, as much as is possible. (pp. 14, 18)

2. Having learned the economic terrain, let it simmer in the background. Think about the contours of the story you have just ascertained—it’s elements of commodification and reification (the ‘thingification’ of social relations, as a relation of tradeable objects).

3. Ask how these contours, in turn, affected “superstructures” as manifest in culture, thought worlds, ideology, politics, psychology, and personality. Again, sensitivity to particular communities and regions, as well as periodization, is a necessity. (p. 14)

4. Think about the relations of conceptual superstructures to social forces and individuals. What are the various levels of articulation between these classes and forces, and how do they compete with each other? Be aware of sites of struggle and crisis. Think about whether the social force, movements, and individuals (all the players) are ‘organic’ (meaning historical and deep) or incidental (“occasional, immediate”). An ‘organic’ crisis can last for decades and is not static. (p. 13)

5. Has the interaction or coordination between these forces created a ‘hegemony’ or effected a historical bloc that sustains hegemonic environment? This definition of hegemony seems useful (from here): “the success of the dominant classes in presenting their definition of reality, their view of the world, in such a way that it is accepted by other classes as ‘common sense’.” Hegemonies are seen through their effects of power and control. Hall also seems to imply, to me anyway, that for Gramsci not all hegemonies are necessarily bad; they can dominate in positive and negative ways. Hegemony is, then, more of a descriptor than a shadowy monster. Hall notes that “‘hegemony’ is a very particular, historically specific, and temporary ‘moment’ in the life of a society.” It is multi-dimensional and has a multi-arena character that involves many fronts in society’s superstructure. Finally, it is a ‘historic bloc’ rather than a ‘ruling class’ that includes the “strata of the subaltern and dominated classes, who have been won over by specific concessions and compromises and who form part of the social constellation but in a subordinate role.” (pp. 14-15)

6. Is the hegemonic class dominating or leading? Domination can maintain the ascendancy of a class, but only with limited reach. A leading hegemonic bloc wins consent by taking into account “subordinate interests” and attempts to maintain popularity. Coercion and consent run together for Gramsci, and run the gamut of cultural, moral, ethical, and intellectual concerns. (p. 16-17)

7. Consider the power—“the sturdy structure”—of “civil society” when analyzing struggles. Most all struggles, in liberal democracies, are won by protracted and complex ‘wars of position’ rather than momentary ‘wars of maneuver” that are reminiscent of WWI trench battles. Those wars of position occur in the context of civil society. The ‘art of politics’, then, is what happens in the context of “voluntary associations, …schooling, the family, churches and religious life, cultural organizations, so-called private relations, gender, sexual and ethnic identities, etc.” The state, in this scenario, is both “educative and formative”—a “point of condensation” for those diverse kinds of institutions and their relations. The state is a function of the “civil hegemony” that derives from that civil society. The complexity of these historical circumstances cannot be emphasized enough. In Hall’s words (as inspired by Gramsci): “This points irrevocably to the increasing complexity of the inter-relationships in modern societies between state and civil society.” Hall adds: “The effect is to multiply and proliferate the various fronts of politics, and to differentiate the various kinds of social antagonisms.” (pp. 17-20)

8. Enter ideology, and how it affects civil society and hegemony. Gramsci defines ideology as “a conception of the world, any philosophy, which becomes a cultural movement, a ‘religion’, a ‘faith’, that has produced a form of practical activity or will in which a philosophy is contained as an implicit theoretical ‘premiss’. …In its best sense [it is]…a conception of the world that is implicitly manifest in art, in law, in economic activity and in all manifestations of individual and collective life.” Given this definition, Gramsci declares that the essential problem of ideology is how it “preserve[s] the ideological unity of the entire social bloc which that ideology serves to cement and unify.” Ideology consists of a philosophical core or nucleus that is linked and elaborated, in Hall’s words, “into practical and popular forms of consciousness” as they affect (and effect) “the broad masses of society, in the shape of a cultural movement, political tendency, faith or religion.” Gramsci is less concerned with the philosophical nucleus than ideology as an organic form which touches thinking people and “practical, everyday, common sense.’ The key here is that philosophy values coherence while common-sense thinking is eclectic—concerned with effectiveness and practice. Common-sense thinking, to Gramsci, is “not rigid and immobile but is continually transforming itself.” It also more likely to be a deep product of historical process. Finally, Gramsi circles back to everyday politics: “The relation between common sense and the upper-level of philosophy is assured by ‘politics’.” (p. 20-21)

9. At this point you, as an historian, might be asking about ‘the self’ and real people. What of the individual thinker, however complex or simple? Gramsci hasn’t forgotten you and them. Gramsci recognizes the individual via plurality. According to Hall, Gramsci “refuses any idea of a pre-given unified ideological subject.” There is a “‘plurality’ of selves or identities of which the so-called subject of thought and ideas is composed.” As such, “the personality is strangely composite.” And on that individual’s consciousness (always a tricky subject in Marxist thought), Hall sees Gramsci as drawing “attention to the contradiction in consciousness between the conception of the world which manifests itself…in action, and those conceptions which are affirmed verbally or in thought.” The result is a “complex, fragmentary and contradictory conception of consciousness” that surpasses considerably the “false consciousness” of traditional/orthodox Marxist thought. In sum, there is no “‘given’ and unified ideological class subject” (p. 22-23). We must try to understand those who participate in hegemonies in the smallest units possible to as to reflect individual and group agency (the final term being my import).

10. Finally, Gramsci even addresses paradigm change—the transformation of hegemonies. Hall found an extraordinary passage in the Prison Notebooks that hits Kuhnian tune. Here’s Hall’s narration:

“The multi-accentual, inter-discursive character of the field of ideology is explicitly acknowledged by Gramsci when…he describes how an old conception of the world is gradually displaced by another mode of thought and is internally reworked and transformed: ‘what matters is the criticism to which such an ideological complex is subjected…This makes possible a process of differentiation and change in the relative wight that the elements of the old ideologies used to possess…what was previously secondary and subordinate…becomes the nucleus of a new ideological and theoretical complex” (p. 23).

A Gramscian vision of benign or pernicious ideological, or hegemonic, change is one where the new paradigm always contains residues of the old. New ideas are articulated, and old one disarticulated. In either case history and historical circumstance are respected.

I noted this on the USIH Facebook page, but consider the “how to” outline above my own kind of tribute to both Stuart Hall—and James Livingston?. The latter probably gets more credit as an antagonist and provocateur than as an authentic person and inspiration to good historical thinking. This one is for you, Jim, even if you think it comes off as sucky, programmatic b.s. – TL

Secondary Bibliography

Notes: (a) These are in addition the abovementioned Hall article and his embedded citations of Gramsci’s works. (b) I do not endorse these in their particulars, but rather as broad guides to thinking about Gramsci’s thought

“A Gramsci Glossary.” Workers’ Liberty. March 27, 2013.

Raney, Vanessa. “Gramsci Outside of Marx?: Defining Culture in Gramscian Terms.” Web essay, Claremont Graduate University (Fall 2003).

Rosengarten, Frank. “An Introduction to Gramsci’s Life and Thought.” Marxist Internet Archive Library, Antonio Gramsci Archive.

A Chinese socialist consensus

Published by Anonymous (not verified) on Sun, 05/09/2021 - 8:42pm in

By Carlos García Hernández (originally published in Spanish in El Común )

Deng Xiaoping and Jimmy Carter during Sino-American signing ceremony - 31/1/1979.Deng Xiaoping and Jimmy Carter during Sino-American signing ceremony – 31/1/1979. Photo: National Archives Catalog

“(a) the monopolistic political power of the Chinese Communist Party (CCP) must not be challenged; (b) within the confines of, and to strengthen, condition (a), economic development should be interpreted as the essence of socialism, and thus of the utmost importance; and (c) regarding the central decision-making process, personalistic regime should be replaced by party rule, i.e., a consensus based collective decision-making process.”

Third Plenum of the 11th Central Committee of the CCP, December 1978

The above quote reflects the consensus that has prevailed in China since 1978. This consensus marked the coming to power of Deng Xiaoping and the start of the economic reforms that have lasted until the present day, which marks the 100th anniversary of the birth of the CCP. The quote was collected by Xu Chenggang, professor of economics at the Cheung Kong Graduate School of Business in Beijing, in his seminal research work “The Fundamental Institutions of China’s Reforms and Development”. Building on this work and on previous articles on what I have called fiat socialism and modern money consensus, I will analyse the Chinese consensus in order to propose the socialist reforms that I believe would help to improve the living conditions of the Chinese people. To do so, I will interpret the information provided by Professor Xu on two levels, one ideological and the other economic.

Xu calls the Chinese economic model a “regionally decentralized authoritarian system”. According to this model, the central government and the CCP leadership control and decide on the political representation of the various Chinese provinces. Once these officials have been chosen, they are responsible for managing most of the economy, since almost 70% of public spending is carried out at the regional level and more than 55% at the sub-provincial level. Then, what is established is a competition between the different provinces. They are placed in a ranking of economic growth and have to compete with each other to climb up the ranking. The provinces are further divided into municipalities (or prefectures), the prefectures into counties and the counties into towns. Competition is established in all subdivisions, so that the most successful subnational governments are rewarded by the central power with more resources. Access to more resources is therefore conditional on success in economic management. This is the basis on which the Chinese economy is established and what distinguishes it from any other economic model ever seen.

The economic results of this model are spectacular. Before 1978, Chinese annual growth was 4.4%; between 1978 and 2011 it was 9.5%. The share of total factor productivity in growth was 11% before 1978; between 1978 and 2011 it was 40%. As a result, between 1978 and 2011, GDP increased 8-fold, a level of growth unparalleled in human history. As Professor Xu explains, one of the consequences has been that “The Chinese population in absolute poverty (defined as $1/day income) has dropped from 50 per cent to 7 per cent in twenty years, while the number of individuals in absolute poverty was reduced by almost 400 million. This number is nearly three-quarters of the poverty reduction in the whole developing world (World Bank 2003)”.

What political interpretations can be drawn from this? In my opinion, one above all: China has definitively broken the link that Karl Marx established between the so-called problem of the realisation of profits and Law of the Tendency of the Rate of Profit to Fall.

Let us recall that, in the second volume of Capital, Marx is confronted with an inescapable question: How is it possible that the capitalists constantly take more money out of circulation than they put into it? Of course, the origin of this subtraction must be surplus value, but “the question […] is not where the surplus value comes from but whence the money comes into which it is turned”. The answer to this question is a turning point in Marx’s work. His reasoning is as follows: the origin of the money into which surplus value is converted must be compatible with the Law of the Tendency of the Rate of Profit to Fall, the fundamental thesis that Marx wants to demonstrate in order to achieve his ultimate aim, which is none other than to expose the inevitable collapse of capitalism, understood as a productive system based on the private ownership of the means of production.

However, this is clearly ad hoc reasoning. That is, instead of analysing the question empirically, Marx designs the answer to the question of the money into which surplus value is converted to fit his predetermined conclusions. Marx thus answers the question by means of the transactions that take place in the private sector and he ignores the existence of the public sector, and for this he resorts to the maxim of Parmenides of Elea, ex nihilo nihil fit, “nothing comes from nothing. The capitalist class as a whole cannot draw out of circulation what was not previously thrown into it”. This is one of the moments when the existence of the gold standard becomes a fundamental pillar of Marx’s work, without which his thoughts cannot be understood. If money cannot be created ex nihilo, then it must be a pre-existing natural phenomenon. Gold and its extraction are the pieces Marx finds to solve the puzzle. Capitalists withdraw more money than they put into the economy because more money is created from new extractions of gold and silver. Thus, “[capitalist production] develops simultaneously with the development of the conditions necessary for it, and one of these conditions is a sufficient supply of precious metals”. Sufficient here does not mean that all money is backed by precious metals, but that the quantity of precious metals must be sufficient to permit the circulation of commodities, which also depends on credit. According to Marx, this credit granted to allow private sector transactions, added to the reserves of precious metals, is enough to enable and explain all the processes occurring in capitalism, which he takes up in his schemes of expanded reproduction and simple reproduction, and he does not hesitate to resort to magical thinking to conclude that “circulation sweats money from every pore”.

By not resorting to the public sector as a source of profit realisation, Marx also manages to save his Law of the Tendency of the Rate of Profit to Fall, since the production of gold and silver, with its particularities, is also explained as the production of the rest of commodities. Thus, the contradictions within the private sector, in which the capitalists are forced to constantly lower wages and increase working hours in order to be able to compete with each other, can only tend to increase to a point where the capitalists’ share of profit, due to the ever-decreasing consumption capacity of the workers, is so reduced that the whole capitalist system collapses.

Now we get into a time machine and travel about a century into the future. When we get out of the machine, capitalism is still there. It is the 1st of January 1979. Deng Xiaoping lands in Washington D.C. to meet with President Jimmy Carter. What happened at that meeting astonished the world. The top leader of the Chinese Communist Party outlined to Jimmy Carter the three points of the Chinese consensus with which this article begins. Unlike the Soviet leaders, Deng did not frame the relationship with the US as a confrontation between two opposing and competing economic systems destined to destroy each other. There were no references to inexorable historical laws. There were no mutual threats. What Deng offered Carter were trade agreements. Deng explained to the Americans that his goal was not the destruction of capitalism in the US, but economic cooperation based on non-interference. If the Americans recognised and respected the sovereignty of the Chinese people, China would not interfere in their internal affairs. On the contrary, it would offer US companies a mutually beneficial access point to the Asian market. Carter not only seized the commercial opportunity offered by Deng, he also officially recognised the People’s Republic of China that emerged from the 1949 revolution.

In my view, the intelligence displayed by Deng Xiaoping at the time was astonishing. I am convinced that it is only thanks to this that the CCP is still in power today. What did this veteran communist militant know that Marx did not? The answer can be found in the date of the meeting, 1st of January 1979, more than 7 years after President Richard Nixon ended the gold standard on the 15th of August 1971. That is more than 7 years of proving that money has always been created ex nihilo. Deng knew this perfectly well, as he was not only the heir to Mao’s revolution, he was also the son of the country that created paper money in the 7th century. To approach China’s relations with the US from a vantage point from which to advocate the imminent collapse of capitalism would have made no sense.

Deng knew that such a collapse was not going to happen. This allowed him to go beyond the Trinity Formula enunciated by Marx in chapter 48 of the third volume of Capital, according to which there are only three sources of income: capital-profit, land rent and labour-wages. Deng knew that there were not three sources but four, since to Marx’s list public expenditure must be added as a source of profit realisation. That is why China’s central bank, called the People’s Bank of China, has played a key role in the country’s development since 1978 by financing sub-national government spending and ensuring that competition between different provinces is on a level playing field.

As Professor Xu explains, this regionally decentralised structure “converts local officials into entrepreneurs”. Decentralisation allows successes or failures to be experienced first at the local level, without destabilising the country as a whole, and allows citizens to feel closer to institutions, which weakens political opposition. This is possible because China’s regions, being so big, are largely self-sufficient, allowing a wide range of goods to be produced. The number of goods under central government control has never reached 1000 and there are only 30 ministries in China. As a result, the central government is much smaller than in other socialist countries and it only controls essential economic sectors (land ownership, banking, energy, telecommunications, railways, etc.). If a reform succeeds in one province, it is possible that other provinces will adopt the same reform. If the reform fails, it is rejected. In any case, the stability of the country as a whole is not put at risk. This is how the transition from a centrally planned economy to a mixed market economy, in which there are all kinds of enterprises (public, private, cooperative, jointly owned, etc.), came about.

Being a mainstream economist, there is a moment in his paper when Professor Xu doubts and wonders how it is possible that China has been so successful. Mainstream economics is dominated by the Washington consensus and Say’s law, according to which non-intervention is essential for flourishing markets to emerge in which, by magic, supply creates its own demand. China is an example of the opposite. There, state and CCP intervention is enormous in all areas, however, economic growth is much higher than in the West. This shows that the Chinese model, despite its obvious shortcomings, is much less corrupt and much more efficient than that of Wall Street, the European Union and all other bodies governed by the Washington consensus, the absurd Say’s law and supply-side economic models.

However, it is also necessary to address the major deficiencies of the Chinese model, since these flaws arise largely from the introduction of neoliberal economic paradigms into its institutions. The most important example of this can be found in the person of Prime Minister Li Keqiang (to whom, fortunately, Xi Jinping does not seem to pay much attention). The economic policies promoted by Li, who holds a PhD in economics from Peking University, are markedly neoliberal in character and deeply influenced by the Washington consensus. As always in these cases, the neoliberal bias translates into an irrational aversion towards public deficits. On the 28th of May 2021, Li said during a press conference:

“The central government is taking the lead in living a tighter life this time. We will reduce the central government’s direct spending by more than half, so that funds can flow to grassroots enterprises and people’s lives. All levels of government must live a tighter life. It is absolutely not allowed to engage in formality, and do those things that spend a lot of money.”

The neoliberal bias of these statements is evident. According to Li, public spending confiscates savings that diminish investment. Like all neoliberals, he understands economic phenomena backwards. Government spending encourages investment because it increases the balance of bank reserves. This encourages demand and therefore investment. To reduce public spending and to think that companies and people’s lives will benefit from this is to miss the point. The reduction in public spending advocated by Li will only increase private indebtedness and unemployment.

This graph shows the evolution of China’s public deficit and its projected evolution until 2026.

 Source IMF


Source: IMF

COVID caused the deficit to increase to 11.39% in 2020. Thanks to this deficit, China was able to contain the pandemic. From a socialist perspective, this data should make it easier to interpret the public deficit for what it really is: a tool to tackle social problems, which in China’s case are many and growing in severity. Therefore, instead of making the reduction of the public deficit an end in itself, Li should forget about the level of the deficit and focus only on social problems. To this end, my proposal for fiat socialism is based on what I have called the Lerner index, which is calculated as the distance between a particular economic situation and one in which unemployment and the absolute value of inflation are equal to zero. In the case of China, the evolution of the Lerner index between 2000 and 2016 was as follows:

The evolution of the Lerner index in China between 2000 and 2016

Chart: year / unemployment rate / inflation rate / Lerner index

The method to bring the Chinese economy to the Lerner point should be the job guarantees based on employment buffer stocks, as these schemes turn permanent full employment, guaranteed by law, into an automatic price stabiliser. The process of reaching the Lerner point in China should not be very complex, since in 1994 the Chinese government took back tax collection as one of its functions and since then has been able to control inflation very efficiently. Therefore, the establishment of full employment and the corresponding price level should occur as soon as possible.

This should be the first step towards the achievement of what I have called the five goals of socialism, which let us remember are:

  1. guaranteed and permanent full employment.
  2. full and prudent use of natural resources.
  3. a guarantee of food, shelter, clothing, health services and education to every citizen.
  4. social security in the form of pensions and subsidies.
  5. a guarantee of decent labour standards.

China has sufficient resources and capabilities to guarantee these five points for its entire population. I am therefore of the opinion that these five points should be incorporated into the three points of the Chinese consensus established by the great Deng Xiaoping. The effort to achieve these five points should not be too great for the Chinese government and the benefits to it would be glorious. I think that is the spirit of these statements by Deng in 1994: “to build socialism it is necessary to develop the productive forces […]. Not until […] we have reached the level of the moderately developed countries, shall we be able to say that we have really built socialism and to declare convincingly that it is superior to capitalism. We are advancing towards that goal.”

Unfortunately, millions of people are not assured of these five points. In China, there are still conditions of misery and exploitation, as in the most savage of capitalist societies, that have made the country one of the most unequal in the world in terms of the distribution of wealth. If the CCP decided to end this exploitation by implementing the five goals of socialism, it would gain enormous support among the lower classes, the same classes that created it 100 years ago, and would strengthen its rule of the country.

Euro delendus est











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Why Work Sucks? Could it be Better?

Published by Anonymous (not verified) on Sat, 28/08/2021 - 10:17am in



Monday morning. [A]

“These really clever people used their brains only to work out how to squeeze as much blood from the workers as possible within the boundaries of the law,” says the mother of 27-year-old Jang Deokjoon, a Coupang worker who died of a heart attack, caused by overwork – Dead on Arrival.

Capitalist societies require a division of labour, in which

[E]ach man has a particular, exclusive sphere of activity, which is forced upon him and from which he cannot escape. He is a hunter, a fisherman, a herdsman, or a critical critic, and must remain so if he does not want to lose his means of livelihood.

And if you work for a living, you know deep inside not only that that is almost trivially true but that such state of affairs is often deeply frustrating. 

I am not talking only about people like South Korean delivery driver Lee Seong-Wook slaving away in poorly-paid, dead-end, killer jobs, although for them that frustration has literally tragic connotations. I am also talking about people in better-paid but pointless, unfulfilling, soul-crushing Graeberian bullshit jobs: people who wish they could slip into an unconscious, automatic pilot, zombie-like mode early on Monday morning, to wake up back into consciousness late in the afternoon on Friday, just in time for the weekend.

Speaking on my behalf – but I would be surprised if your case is entirely different – that frustration comes in part from the realisation that, if it were not for the economic imperative of earning a living, one could do better, have a more satisfactory life, doing more interesting, more varied and productive things. In one such society – which Marx called “communism”

[N]obody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow.


While we don’t live in such a society, some of us can still have a foretaste of how working life could be under Marx’s understanding of communism.

For some of us in Oz, this may mean volunteering for reputable not-for-profit organisations (it should go without saying, but here goes nevertheless: not all organisations qualify). State volunteer fire brigades (here is the volunteer portal for the NSW Rural Fire Service) are a good example of such reputable not-for-profit organisations, but other organisations are available.

There are more alternatives.


In 2018 British Columbia resident and amateur astronomer Scott Tilley was looking for the Zuma satellite, writes Kristen Pope for National Geographic (paywalled), when he spotted something else. Upon further investigation Tilley discovered it was spacecraft 26113, missing since 2005.

Urged by his wife, Tilley informed NASA of his discovery:

He says he “woke up the next morning to an inbox that had just exploded… My phone had gone nuts. All these people from NASA were trying to reach out to me and find more information”.

Tilley’s finding allowed NASA recover data from 26113. Good work, Scott!

Pope provides links to places where US resident citizen scientists can volunteer. Here are some:

I compiled a short and certainly non-exhaustive list of similar places Down Under:

Image Credits:
[A] Group of zombies, shooting of the film Meat Market 3. Author: Joel Friesen. Source: WikiMedia. File is licensed under the Creative Commons Attribution 2.0 Generic license. Nobody endorses me or the use I make of the file.


Published by Anonymous (not verified) on Fri, 27/08/2021 - 5:38pm in

Radical Gender Theory and the Left

As a trans person, I’ve really been struggling with the idealism of trans activism as it pertains to identity. They seem to say that however you identify your gender is who you are. So if you say you’re a woman, you’re a woman, and if you say you’re non-binary, then you are. But isn’t this the core of idealism, to put identity in the determinant position? 

—comment on Reddit’s r/communism forum

In his latest series of documentaries Can’t Get You Out of My Head (reviewed by Guy Rundle in Arena no. 6), sociologist and film-maker Adam Curtis focuses on a number of individuals who sit at the uneasy intersection of modern individualism, an increasingly technologised vision of the human mind and human behaviour, and a liberatory politics denuded of grand historical narratives. Key portraits in this gallery include the US rapper Tupac Shakur, who attempts to recreate in music something of the political radicalism of his mother (the Black Panther Afeni Shakur) but finds himself trapped by celebrity culture, and the countercultural author Kerry Thornley, who sought to satirise conspiracy thinking, only to succumb to it in later life. But perhaps the most interesting figure of all, in terms of the ideological positioning of the contemporary ‘mainstream’ radical Left, is the transgender activist Julia Grant, whose story Curtis glosses in an article for the Guardian

Julia Grant grows up near Blackpool in the 1970s. She comes to London—and realises that she wants to live as a woman. She is part of a shift that will sweep through modern society that says that true freedom doesn’t come any longer from changing the world—but changing yourself—to become who you know inside you really are. At the start of the 1980s, Julia sets out to take on the medical establishment. An anonymous psychologist behind the camera in the TV documentary A Change of Sex wants to stop her. Julia has extraordinary courage—and decides she will stand up to him and what he represents about an old uncaring society in Britain.

Here, as in the documentary itself, Curtis’s admiration for Grant is more than tinged with reservation. For while Grant does indeed show plenty of courage in her clashes with her (assigned) psychiatrist, who is callously unsympathetic to her desire for gender reassignment surgery, she is also a paradigmatic case of the individualisation of politics that is one of Curtis’s principal themes. The question, for the Left no less than for Curtis, is whether this ambivalence necessarily implies a demotion of Grant’s struggle for recognition. If Julia’s claim to womanhood is bound up with a more general malaise, what do we make of the claim itself?  

I find it surprising that this question has barely arisen in the responses to Curtis’s documentary. As one of the first ‘transsexuals’ to share their story with a mainstream audience, Grant would have cut an exotic figure when she first came to prominence in the 1980s. But in recent years transgender issues have entered mainstream culture and politics with remarkable rapidity and force, such that we now have an entirely new language in which to talk about sex, gender and the relationship between the two. For some, this new language contains a recognition that the old one could not fully register, or even perhaps begin to register, the rich complexity of sex and gender, while for others it represents an attempt to rewrite the rules of nature itself. Indeed, and whatever else they denote, words and phrases such as ‘gender fluidity’, ‘non-binary’, ‘cisgender’ and ‘heteronormativity’ are ideological Rorschach prints that will strike the culture warrior as either the conceptual architecture of a new and hopeful gender politics or the modish cant of ‘cultural Marxists’ bent on revolution by stealth. Grist to the outrage-media’s mill, the status and rights of transgender people—i.e. people whose gender identity is at odds with their birth sex—is an issue in which the underlying themes of our political era coalesce. Identity, safety, rights, language, expertise and techno-science are all in the discursive mix. 

For a section of the contemporary Right, the issue of transgender activism is now an ideological twofer that allows it to hold its conservative/reactionary and liberal/libertarian troops together for the sake of a few raids into progressive territory. On the one hand, it can take the claims of transgender activists as an opportunity to press its case for traditional notions of sexuality and gender, and on the other it can present the style of that activism (not always erroneously, it should be said) as an attack on classical liberal verities such as freedom of speech and freedom of assembly. No doubt it is significant that the conservative psychologist Jordan Peterson came to prominence on the back of a controversy about an amendment to the Canadian Human Rights Act, which, he argued, would compel Canadians to modify their use of gendered pronouns when addressing transgender and non-binary people—a stance that it suited him to present as a liberal defence of open debate but was also, clearly, an antechamber to his views on the ‘crisis of masculinity’ that had come about as a consequence of postmodernism and identity politics. Similarly, the Safe Schools anti-bullying program was characterised as both a postmodern assault on long-established beliefs and behaviours and as an example of intellectual policing, all the more sinister for being aimed at kids whose sexuality and critical faculties were both in the early stages of development. (Again, this characterisation was not entirely erroneous. The materials for the Safe Schools program do appear to channel a view of the body as a ‘blank slate’ onto which culture projects gender, while the decision to introduce such subject matter in the form of an anti-bullying program, instead of as part of the syllabus, may appear from a certain angle to be an attempt to get one’s retaliation in first.) 

In broadly progressive circles, by contrast, support for transgender and non-binary causes is acquiring the quality of a shibboleth. Clearly, much of this support is based on simple solidarity with a marginalised group subject to prejudice and violence, and on a deep (and deeply liberal) conviction that it is wrong to require someone to live in a way that feels untrue to their ‘real’ self. But there is also plenty of evidence to suggest that radical gender theory has left its mark on progressive politics as well, even if only superficially. The sudden prominence of the word ‘cisgender’ to describe those whose gender identity correlates with their birth sex, the incorporation of pronoun preferences into social media profiles and the like, the passing of laws that make it permissible to change the sex on one’s birth certificate without assessment or reassignment, and a succession of highly mediatised controversies around allegedly ‘transphobic’ statements on the part of celebrities and journalists, suggest not only broad acceptance (or unthinking assimilation) of the core tenets of radical gender theory but also a desire to put that acceptance in the shop window of progressive politics. The recent statement by Duncan Maskell, vice-chancellor of the University of Melbourne, that academic freedom does not extend to comments that cause ‘harm’ to transgender people, will strike many on the Left as overreach, and some of us as ludicrous (not because we are in favour of harm, but because we see how the extension of the harm principle is eroding what’s left of the public sphere). But it is the symptom of a more general feeling that the question of transgender selfhood is settled, and that statements to the contrary are politically toxic. 

TERF wars 

In some progressive circles, however, the idea that one’s gender identity can be neatly separated from one’s physical being, or that one’s physical being is itself ‘gendered’ in a way that makes any talk of its reality necessarily ideological, is proving deeply controversial. For an older generation of feminists, in particular, the prominence of transgender issues can often seem like a challenge to, and even a rejection of, some very different shibboleths to the ones on offer from GLAAD and its analogues. Often characterised (not always unfairly) as ‘trans-exclusionary radical feminists’ (TERFs), these activists and commentators may make the point that some of the men who identify as women (and vice versa) are apt to reproduce the stereotypes that underpin patriarchal attitudes. More basically, their objections stem from a feeling that transgender politics downplay or deny the centrality of the body to female lived experience. It was this issue that got J. K. Rowling into hot water when she objected to the phrase ‘people who menstruate’ in an article on menstrual health in the global South. Or here is the journalist Suzanne Moore, in the article that got her sacked from the Guardian:

The radical insight of feminism is that gender is a social construct—that girls and women are not fated to be feminine, that boys and men don’t have to be masculine. But we have gone through the looking-glass and are being told that sex is a construct… Female oppression is innately connected to our ability to reproduce. Women have made progress by talking about biology, menstruation, childbirth and menopause. We won’t now have our bodies or voices written out of the script. 

In an article in The Sociological Review, a number of British academics characterised these comments, and others like them, as inseparable from a reactionary campaign against transgender and non-binary rights, and it is true that the doctrine of ‘my enemy’s enemy’ will mean that any criticism of queer/radical gender theory will be taken up and weaponised by those whose opposition to ‘transgenderism’ is fuelled by simple prejudice. But to assume that criticisms such as Moore’s are therefore channelling such prejudice is obviously a non sequitur that serves to stifle genuine debate, precisely in the way that the Right often claims. Moreover, it stifles debate about precisely the thing we need to be debating as we move deeper into the techno-scientific era—namely, the ontological status of the human being/animal in a society that invites us to regard ourselves as in some sense above, or remote from, nature. Reading the criticisms of Moore and Rowling, and many other commentators besides, one has the sense that biological sex (or, more usually, ‘biological sex’) is regarded as, at best, a red herring, and, at worst, a Trojan horse from which, when night falls, the forces of reaction will emerge and set about their bloody business. But of course for certain traditions within feminism, and also for the wider material Left into which those feminist traditions were marbled, the issue of whether there is a physical ‘nature’ that is prior to and influential on cultural meanings or ‘scripts’ is one of foundational importance.

As Arena’s Simon Cooper has noted, in a piece on the fallout from Germaine Greer’s comments on the status of transgender women, ‘it’s one thing to distinguish between sex and gender; it’s quite another thing to say embodiment and biology float free of history and culture, subject to the needs of identity’. Greer has suggested, with characteristic indelicacy, that she doesn’t ‘believe a woman is a man without a cock’ and that ‘If you didn’t find your pants full of blood when you were 13, there’s something important about being a woman you don’t know’—comments that have earned her a severe dressing-down in some sections of the mainstream press. Nevertheless, and as Cooper suggests, we should look past Greer’s off-colour flourishes to her invocation of those ‘markers of embodiment’ that are, for her, inseparable from the experience of being a woman. As he puts it:

Greer’s listing of some of the features and biological processes of the female body—ovaries and uterus, menstruation and menopause—is not simply biological essentialism but indicates how these things are integral to gendered identity. They are physical processes subject to culture and to forms of social integration and understanding, and they are experienced over time. Their meanings can/should be challenged as part of a political project, but they cannot be dismissed by an act of will.

That such meanings, derived in part from biology, are ‘dismissed by an act of will’ is evident from some of the reactions to the Greer controversy, and to others, in progressive circles. In an essay in Meanjin, for example, Eleanor Robertson referred to Greer’s ‘biological essentialism’ and accused her of ‘policing a line of demarcation she perceives as the enabling force of collective struggle’ and of attacking ‘nascent forms of solidarity she doesn’t understand’. Engaging in a bit of ‘policing’ of her own, Robertson describes as ‘morally and organisationally bankrupt’ the idea that there may be a biological basis for female solidarity, though why such a basis must always lead back to the ‘class interests of men’ she doesn’t say. Similarly, the revelation in 2015 that a US anti-racism activist had been ‘passing’ as Black caused many progressives to tie themselves in knots in response to (often mischievous) comparisons between the activist in question, Rachel Dolezal, and the transgender celebrity Caitlyn Jenner. What should have been an opportunity to think through a few important distinctions, and to consider the ways in which gender and race are socially and psychically constructed on the basis of biological differences that may or may not shape experience in ways prior to those psychosocial constructions, descended into a brawl in which any comparison between Dolezal and Jenner was treated in progressive circles as axiomatically transphobic and racist. The (Black) professor Adolph Reed, a tireless critic of identity politics, was happy to point out what he and others regarded as a double standard: ‘The transrace/transgender comparison makes clear the conceptual emptiness of the essentializing discourses, and the opportunist politics, that undergird identitarian ideologies. There is no coherent, principled defense of the stance that transgender identity is legitimate but transracial is not, at least not one that would satisfy basic rules of argument’.

It is not, then, transgender people as such but the informing assumptions of radical gender theory that need to be debated and challenged. The idea that there is no significant relationship between sex and gender carries with it an assumption about human beings that should strike those on the material Left as a challenge to an idea of freedom without which ‘the Left’ as a political entity would never have come into being at all—the idea that human beings can only flourish if certain material needs are met, and that these needs derive from our status as creatures that are bound by and are a part of nature. Indeed it is precisely the materiality of freedom that separates the Left from the (liberal) Right. While the right-libertarians of the Institute of Public Affairs regard freedom as reducible to negative rights such as freedom of speech or the freedom to own property, socialists are supposed to know that freedom entails enabling conditions that are ultimately based in our creatural needs—that arise, so to speak, from embodiment

Indeed, radical gender theory presents the Left with an ‘identity crisis’ of its own, in a way that goes beyond the usual (and often legitimate) gripes about how the politics of identity has taken contemporary progressives away from issues of class or material distribution. That crisis does not begin with radical gender theory. Nor, rest assured, will it end with it. But it is very important to understand exactly what is at stake in this debate, and the very different visions of the future that necessarily emerge from it. 

New subjectivities 

As Guy Rundle demonstrates in his article, ‘How radical gender theory hijacked Marxism and why we need to get it back’, published in Crikey in 2016 in the midst of the Safe Schools controversy, the route from revolutionary socialism to radical gender/queer theory is based on two problematic aspects, or perceived aspects, of Marx’s thought. The first is the idea that the economic ‘base’ dictates the cultural and institutional arrangements that constitute the ‘superstructure’, up to and including the family unit; and the second is the idea that human liberation entails a transcendence of our biological condition—an idea based, in my opinion, on a highly tendentious reading of Marx. (For a thorough critique of this idea, see Norman Geras’s Marx and Human Nature.) In the 1960s, as the limitations of the base-superstructure model became apparent, some on the Left looked to deepen the idea that social and cultural meanings were ‘constructed’ by turning, first, to structuralism—an idea from anthropology that stressed how societies create meaning and hierarchy by constructing oppositions (e.g. male/female) that effectively define each other—and then to the ‘post-structuralist’ idea that social meanings are entirely constructed. When this notion of the arbitrariness of social meaning combined with the notion that liberation necessitates a radical break with nature, many radicals moved decisively beyond the philosophical materialism that had defined revolutionary socialism and adopted the idealism (as I take it to be) of post-structuralism. Fleshed out in Judith Butler’s Gender Trouble (1990), the new ‘queer theory’ asked us to consider ‘the duality of sex’ as itself a construction. ‘[W]hat is “sex” anyway?’ Butler asked; ‘Is it natural, anatomical, chromosomal, or hormonal, and how is a feminist critic to assess the scientific discourses which purport to establish such facts for us?’ But as important as these questions were, the underlying notion that social meanings are entirely constructed—that they are ideological ‘all the way down’—has militated against any clarifying answers. For a large section of the radical Left, it has simply become enough to say that there is no relationship between sex and gender. 

As Rundle notes in his article, such beliefs are connected in a deep way to a particular form of being in the world. The post-industrial economy in countries such as Australia is one in which a newly expanded class of ‘knowledge’ or information workers deals principally in data, texts, images, statistics and the like. It is a world not of old-style manual labour but of representations of the world, and it is within such a cultural and intellectual ecology that something like queer theory (in its hard and soft versions) is able to take hold and flourish. Indeed, it is significant that queer theory was nourished in the academic fields of criticism and cultural studies before being re-exported to the social sciences—a history to which the many references to ‘tropes’ and ‘scripts’ and ‘performances’ attest. ‘There’s a lot of identities, selves, and self-shaping in the literature of Safe Schools’, writes Rundle; ‘there’s a decided absence of actual bodies and sex, the viscous, vicious, unequal, powerful and chaos-bringing embodiment of sex, which is pretty uppermost in adolescents’ lives’. Queer theory offers a dematerialised activism for increasingly dematerialised thought-worlds. 

The sudden prominence of radical gender theory, then, is consistent with a form of life in which identities do indeed appear to float free of embodied being. But of course it is precisely this ‘freedom’ that capitalism in its current phase finds it so rewarding to cultivate, not least through new technologies in which it is not only possible but necessary to perpetually construct one’s identity—technologies to which performance is central. As grounded social life recedes in the face of neoliberalism, our relations with others become increasingly mediated, as well as increasingly ephemeral and fraught; and the more we are remade as individuals who must continually remake ourselves, the more we turn to the marketplace. This is not to adopt a crude base-superstructure-ideology model, or to suggest that queer theorists are neoliberalism’s useful idiots, but to stress the way in which new subjectivities are folded into both techno-scientific capitalism and certain kinds of activism. In a time of ‘liquid modernity’ (Bauman), ‘fluidity’ is celebrated, albeit often in the contradictory form of a great proliferation of new fixed sexual/gender identities. 

The focus on the psychic ‘safety’ of transgender and other minority groups is central to this picture. For the Right, the progressive emphasis on safe spaces, trigger warnings, no-platforming and so forth is evidence of a ‘snowflake’ generation; but this is to misunderstand entirely the cultural shift that is taking place. For while accusations of offence and bullying are often tiresome and politically expedient, they are also clearly related to the cultural and technological developments described above. Subject to constant curation and monitoring, and scattered across a range of media, identities need to be shielded from injury lest they break apart entirely. The endless expansion of the ‘harm principle’ is a necessary bulwark against psychological crack-up—a supplement to the new armouring competencies of mindfulness, resilience and empathy. That queer theory was introduced to mainstream Australia through an anti-bullying program is in this sense perfectly explicable. 

Radical gender theory, then, is difficult to separate from the wider shifts that are taking place as capitalism steers us ever deeper into the techno-scientific era—an era that even now offers ways to change or transcend our given embodiment, through implants, brain–computer interfaces and (perhaps most important in the long run) CRISPR-Cas9 gene-editing technology. At the moment, many of these technologies are subject to rigorous ethical constraints, though the medical imperative to ‘do no harm’ is as likely, in my view, to permit new interventions as it is to hold them back. But as we become habituated to such technologies as are already extant, and as the market continues to heroicise the sovereign, wired-up individual, they are sure to become less marginal. What this will mean for gender and sexuality in the long term is impossible to say, but surely it is significant that the sector that is often held up as exemplary in its attitude to LGBTQ issues is the one charged with innovating such transformative tech. Indeed my sense is that radical gender theory makes for a pretty tidy fit with the body-as-hardware/mind-as-software view of human beings favoured by many in Silicon Valley and its analogues. Though worlds apart in many ways, the informing assumptions of radical gender theory share a common base with the technological ‘transhumanism’ that seeks to dramatically extend human life and even replicate human consciousness in a way that ‘liberates’ us from our bodies entirely. 

Such an ambition remains in the realms of fantasy. But the view of human life that fuels it is sure to sanction—will continue to sanction—interventions that radically recast the relationship between human beings and the ‘natural world’, up to and including the human body. In such circumstances, one would want to see a Left that could think critically about the subjectivities that allow such promethean dreams to flourish, and demand not only common ownership of such technologies as are already with us (as per the ‘fully automated luxury communists’) but also an urgent moratorium on a developmental ethos that is itself inseparable from techno-scientific capitalism. My fear is that radical gender theory, and the ways of seeing to which it is related, make that difficult, if not impossible. 

A promethean synthesis? 

It seems to me that many progressives are desperate to avoid the questions thrown up by radical gender theory, not least because its most strenuous advocates have mounted guard over the rights and safety of transgender and non-binary people with passion and single-mindedness. For these progressives, the idea that ‘all claims to liberation from an inherited conservative order are valid’ (Rundle) is the fundamental political value. Nevertheless, it is highly unlikely that many of them would accept the full implications of radical gender theory in its Butlerite form, and it is here that the progressive attitude to science and/or expertise is likely to play an important role. As the expert-managers of the knowledge economy, rightly appalled by the Right’s stupidity and nihilism in respect of climate change and vaccination, many ‘soft’ progressives now evince a more or less reflexive regard for scientific or credentialled opinion. Positions are asserted (often correctly) on the basis of ‘the science’ alone, rather than any worked-out position, and my sense is that, in the case of trans issues, this reflexive reverence has now combined with a spirit of solidarity and compassion in a way that effectively removes the topic of gender theory from the sphere of contention. Dan Andrews’ comments in March 2016 on proposed government changes to the Safe Schools program, which set the experts against the ‘bigots’, were in this sense representative of a more general progressive stance. Similarly, the ABC’s documentary on the paediatrician Michelle Telfer, who has been subject to a vicious campaign from The Australian, stressed both her compassion and her professional rigour, but had little to say about the science and psychology informing the process of gender reassignment it is her role to facilitate.

My point is not that the small minority of transgender people who want to transition shouldn’t be allowed to do so. Such transitions may indeed be what some people need in order to be/feel free. My point is about the way an issue of identity and recognition has quickly become a taken-for-granted good, and medicalised under certain pressures. No longer able to think outside the social and economic conditions in which they play a central role, progressives have shifted the burden of decision to social actors they trust as ‘theirs’: the activist charity, the medical practitioner, the academic with a feel for how conventional notions of x or y are replete with bias and bigotry, and, of course, the experience and choices of those who would live differently, outside the mores of mainstream society. If this process can occur with an issue as central to human culture as sex and gender, it can occur with almost anything.  

For all the (very real) threats we now face from the new reactionary Right, the most momentous development of our era has been the continued subordination of nature by techno-scientific capitalism—a socioeconomic ensemble to which a certain idea of liberation is central. It follows that a radical left-materialism must begin by acknowledging our groundedness in nature, reflect on the cultural and intellectual conditions that have permitted a contrary world-picture to flourish, and identify, as aspects of the same delusion, the idea that we can endlessly manipulate the environment, and the idea that we can manipulate ourselves to better fit the cultural reality that has grown up in the shadow of that promethean project. Today techno-scientific capitalism presses in on us at every turn. A socialism that has nothing to say about that, and about the kinds of creatures we are, is a socialism that will reproduce its radically antihuman assumptions and facilitate its assault on ‘all that is solid’.

1971-2021: 50 Years Since the USA Reneged on Bretton Woods

Published by Anonymous (not verified) on Thu, 19/08/2021 - 5:26am in

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For the CWO, and indeed the entire political tendency to which we belong, it is axiomatic that we are living through capitalism’s third global economic crisis. For over a century the economic system (mode of production) which was once progressive for humanity, in that it created the material possibility of a prosperous world community without national borders or class divisions, has represented a barrier to human progress when it is not a direct threat to human existence itself.

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After the Cuban Protests: Discussion with Proletarios Cabreados

Published by Anonymous (not verified) on Wed, 18/08/2021 - 1:51am in


Cuba, Marxism, Protests

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We are publishing here our translation of a further document on the Cuban protests in July, entitled Análisis de la actual crisis y revuelta en Cuba desde la perspectiva comunista radical, by a group in Ecuador which goes under the name of Proletarios Cabreados (Pissed off Proletarians). You can find them at

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Minor Threats And Attacks – 45 years of political experience in India

Published by Anonymous (not verified) on Sun, 15/08/2021 - 11:01pm in

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Born in a village in Jaunpur district in eastern Uttar Pradesh, Hari Lal after working in brick kilns on the East Pakistan border, plying rickshaw in Benaras, breaking iron in Bareilly...

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The Victoria Street Green Ban and Juanita Nielsen.

Published by Anonymous (not verified) on Wed, 04/08/2021 - 4:22am in


Fifty years ago, Australian unions pioneered the modern conservation and environmental movement in Australia. The first half of the 1970s was the time of the green bans.



Leaders of the NSW Builders Labourers’ Federation, convinced that unionism went far beyond standard “bread-and-butter” issues – wages, working conditions, OH&S – mobilised their union’s power to oppose urban development projects requiring the eviction of low income households, the destruction of the environment or the loss of heritage buildings:

“It’s not much good winning a 35-hour week if we’re going to choke to death in planless and polluted cities, where rents are too high, where ordinary people can’t live” – NSW BLF secretary Jack Mundey

It was a popular move and sometimes even the well-heeled would join that kind of protest. Enter Juanita Nielsen, who was murdered during the backlash against the green bans. It has received considerable attention from the ABC Radio National. A fascinating read: the unlikely but tragically true story of the fight between sexy and fashion-conscious Juanita Nielsen, journalist, publisher, and heiress to a wealthy and conservative Anglo family, her low-income neighbours, a bunch of activists/squatters of varying races, and their working class, Commie BLF and Water and Sewerage Employees Union allies against ruthless developer Frank Theeman and organised crime boss Abe Saffron (and here), their army of goons, and their many powerful and allegedly corrupt friends – including the president of the federal BLF, Maoist “Big” Norm Gallagher, the NSW Premier Sir Bob Askin, and the NSW Police Force.

History is a lot messier than historians and philosophers make it appear, isn’t it? To his credit, Michael Dulaney tells it well, from beginning to bittersweet aftermath.

Other accounts:
Caroline Graham writes about “The Life and Times of Juanita Nielsen”.  In “Vale Jack Mundey: The Builders Labourers’ leader who saved Glebe”, Meredith Burgmann focuses on Mundey. First row witnesses Ian Milliss and Teresa Brennan tell the story of the last days of the Victoria Street Green Ban.
 Ah! McCain, you’ve done it again! If you live in Oz, you’ve heard that slogan. Sadly, it’s true!
For the second time in two weeks McCain Australia locked out 90 workers of their Smithton plant (north-western Tasmania). Why?

Because after taking a pay cut during last year’s lockdowns and recession, those workers are now asking their pay to match that of their mainland comrades (up to 15% higher). You see, those workers wanted to help McCain (Tassie comrades, seriously, there’s nothing more heartwarming than a naive kid who believes in Father Christmas; but you aren’t kids anymore: learn that lesson).

McCain workers in Smithton are willing to wait it out, but they can’t do it alone. Can you show your solidarity and support by making a donation?