Friday 7 July 2023

The Poverty of Philosophy, Engels' Preface To The First German Edition (1885) - Part 13 of 14

In a rebuke to those statists and plannists that have dominated the socialist movement for more than a century, Engels makes the following comment, in response to Rodbertus.

“And anyone who does not believe this can apply to governmental chief revenue office accountant X in Pomerania who has checked the calculation and found it correct, and who, as one who has never yet been caught lacking with the accounts, is thoroughly trustworthy.” (p 20)

Engels describes the way crises of overproduction of commodities is the means by which these imbalances between aggregate demand and supply are resolved, but,

If now competition is to be forbidden to make the individual producers aware, by a rise or fall in prices, how the world market stands, then they are completely blindfolded. To institute the production of commodities in such a fashion that the producers can no longer learn anything about the state of the market for which they are producing – that indeed is a cure for the crisis disease which could make Dr. Eisenbart envious of Rodbertus.” (p 20-21)

And, as Marx sets out, in Capital III, nor is this resolved by having the state, or central bank, buy up the excess commodities, whether it does so by increasing taxes, borrowing, or printing excess money tokens. In short, Rodbertus, like Proudhon, does not understand the true nature of value, and how it is created, and measured by labour. He speaks only abstractly of labour, at best only admitting to different degrees of its intensity. So, any recognition of complex as against simple labour is missing from his theory, as is recognition of the fact that its only necessary labour that is value creating.

“If he had investigated by what means and how labour creates value and therefore also determines and measures it, he would have arrived at socially necessary labour, necessary for the individual product, both in relation to other products of the same kind and also in relation to society’s total demand. He would thereby have been confronted with the question as to how the adjustment of the production of separate commodity producers to the total social demand takes place, and his whole utopia would thereby have been made impossible. This time he preferred in fact to “make an abstraction", namely of precisely that which mattered.” (p 21)

Whether it is in relation to the Stalinist states or the ideas of the statists in general, this flaw underpins the flaw in their overall approach, whereby these disparities, in aggregate demand and supply, can be simply overcome, or papered over, by the state buying up the excess, stimulating demand, or nationalising the capital that is not capital. Another example of that was given recently by Michael Roberts, in the Weekly Worker, when he wrote, in respect of China,

“However, there will not be a financial crash in China, because the government controls the financial levers of power: the central bank; the big four state-owned commercial banks, which are the largest in the world; and the so-called ‘bad banks’, which absorb bad loans; big asset managers; and most of the largest companies. The government can order the big four banks to exchange defaulted loans for equity stakes and forget them. It can tell the central bank, the People’s Bank of China, to do whatever it takes. It can tell state-owned asset managers and pension funds to buy shares and bonds to prop up prices and to fund companies. It can tell the state’s asset companies to buy bad debt from commercial banks. It can get local governments to take up the property projects to completion. So, because the state controls the banking system, a financial crisis is ruled out.”


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