Practical and theoretical beliefs

Aristotle distinguished between practical and theoretical beliefs. A practical belief, such as 'fire can burn you', is rooted in experience - disbelieving it has real consequences; the theoretical belief 'the Sun goes round the Earth' delivers no consequences unless you're an orbital mechanics engineer.

Many beliefs propagated through formal education (particularly in the social sciences) are theoretical and that's why so much wish-fulfillment goes unchecked. Theoretical beliefs only become practical when they have consequences which impact upon the believer; they say a conservative is a liberal who's been mugged.

Up to my late thirties, I had a lazy, egalitarian-socialist political philosophy in which I was strongly (or so I thought) opposed to paid medical care.

'No queue jumping!' I said to myself and to others.

In 1989 I had a really bad, painful attack of hemorrhoids while working on assignment in Italy (heritability 56% to 61% - my father also suffered) and found that my Nortel company medical scheme would pay for an immediate operation. The wait for NHS treatment would have been months and I would have found airport-hopping telecoms consultancy difficult while in graded varieties of pain.

What did I do?

I considered the matter for just a few hours - I would say for the first time in seriousness - and queue-jumped.

Marx: "Right about capitalism, wrong about socialism"

I've been engaged in an exploration of the Marxian analysis of capitalism as a mode of production, how any successor society might emerge and what it might be like. I've read the first two volumes of Capital (bulky, circuitous and sprawling though they are) and also two excellent introductions from Michael Heinrich and Duncan Foley.

Amazon link .. and PDF

Amazon link .. and PDF

I feel quite sufficiently educated. I also concur with the Russian epigram quoted above: Marx was right about capitalism, but wrong about socialism.

But .. before we get too judgemental .. it's worth bearing in mind that Marx said very little about socialism. As Duncan Foley observes in his "Socialist alternatives to capitalism I: Marx to Hayek",

"In general Marx responded to questions about his views on the organization of socialist society by saying that these questions could be solved only by those who actually confronted them historically, that is, presumably, by the revolutionary movements that would establish socialist institutions. This is a prudent and in some ways sensible stance, but frustrating to a posterity that has made notably little progress on these problems."

Foley continues:

"Really existing socialism

"History, of course, was not waiting for political economy to sort out the issue of socialism. The early decades of the twentieth century also saw the emergence of a Soviet Union dedicated, rhetorically at least, to the building of a socialist economy, out of the wreckage of the Russian Empire.

The Bolsheviks confronted two practical political economic problems in the 1920s. Perhaps the lesser was the organization of day-to-day production and distribution. The greater was what later came to be called the problem of “development”: how to transform the backward, largely traditional agricultural economy of the sprawling Russian empire into a viable industrialized power.

The second task was all the more pressing because the denouement of the First World War on the Eastern Front had revealed the military and political vulnerability of a backward Russian economy in a world increasingly populated by industrialized capitalist powers.

The Soviets, whose leadership contained some remarkably talented and thoughtful figures, such as Nikolai Bukharin, arrived at a practical solution to the problem of organization of day-to-day production fairly soon after consolidating political power through prevailing in the Civil War with the Whites. This took the form of the “New Economic Policy” (NEP), which allowed, and indeed encouraged, capitalist commodity production in many sectors of the economy, including food production.

The NEP structurally created a “mixed” economy in which a large private sector co-existed with state-sponsored industrial enterprises. (The NEP is recognizably a precursor of Deng Xiaoping’s “socialist market economy” which was the framework for Chinese economic growth in recent years.)

The NEP worked well to stabilize the Soviet economy after the Civil War; under this regime output and incomes recovered significantly from the low levels of the Civil War period. Many Bolsheviks, including Lenin, were willing to accept the NEP framework as an indefinitely prolonged phase of building socialism, as long as the state held the “commanding heights” of the economy through control of energy, transportation, heavy industry, and finance.

Two connected and predictable developments undermined the NEP. First, as we would expect, the privatized commodity-producing sector of the economy exemplified some fundamental laws in generating large disparities in income and wealth. The appearance of a wealthy proto-bourgeoisie in the midst of a society governed by a one-party dictatorship committed to socialist goals threatened the narrow political base of Bolshevik power.

Second, the NEP was structurally favorable to the agricultural sector, particularly to the market-oriented strata of the peasants. The NEP thus resulted in a relatively “balanced” path of economic growth between industry and agriculture. Not surprisingly the prices of food and other agricultural products tended to rise relative to industrially produced goods, limiting the degree to which surplus production in agriculture could be mobilized for rapid industrial investment.

Despite Bukharin’s determination to “ride to socialism behind the peasant’s nag”, NEP policies proved explosively unstable politically, and collapsed under efforts to mobilize agricultural surpluses by military force which ultimately led to collectivization, central planning, and the bloody political purges of the nineteen-thirties.

Stalin rather than Bukharin balanced at the top of the “greasy pole” of Communist Party politics apparently more by ruthless and opportunistic manipulation of coalition politics than through consolidating a stable political base of power.

Just how the Soviet economy did operate in the 1930s, and in particular what was the practical mixture of bottom-up and top-down dynamics in this period remains obscure. A relatively small central planning bureaucracy had in theory enormous economic power to implement a policy of extremely rapid industrialization centered on the expansion of heavy industry. It seems unlikely that the fairly coarse-grained plans produced could be the whole story of Soviet economic life under this regime.

The management of new industrial armies recruited to new urban centers involved a great deal of decentralized local improvisation and experimentation. Since the centralized planning bureaucracy did not actually control many resources itself, local managers facing shortages of inputs and surpluses of outputs improvised informal market-like arrangements with each other. Despite the wishful thinking of market-fundamentalists, capitalist economies in periods of extremely rapid industrialization have often strayed significantly from the orthodoxies of profit-maximization given market prices, making it difficult to draw hard analytical lines by which to characterize the Soviet experiment.

While the Soviets were engaged in their furious (if in the very long run curiously futile) attempt to change the world, western European philosophers continued to interpret it. ... "

In his follow-up paper, "Socialist alternatives to capitalism II: Vienna to Santa Fe", Foley contemplates the great complexity of the global capitalist economy and speculates how any subsequent mode of production could do better as regards the difficult issues of economic information retrieval, resource allocation and optimality of outcomes. He contrasts top-down and bottom-up approaches:

"The last half of the twentieth century saw an upsurge in interest in bottom-up self-organized systems, such as ant-hills and bees’ nests, bird flocks, computer networks, unsupervised learning algorithms such as neural nets, the capitalist economy, possibly the human brain and a host of other similar examples.

Several features of these bottom-up systems draw the attention of systems thinkers. For one thing, compared to top-down optimal control systems, bottom-up self-organized systems tend to be more “resilient” or “robust”. Self organized systems often (though not invariably) continue to function (possibly in a degraded mode) despite the disruption or even destruction of important subsystems, and in important cases can recover from such damage spontaneously.

Top-down systems can be built with considerably “redundancy”, but tend to be more vulnerable to disruption of key elements, particularly the feedbacks that implement their optimal control properties.

Another intriguing property of bottom-up self-organized systems is that although they are not designed to achieve optimal performance, they often do perform surprisingly well. Ant-hills, for example, are remarkably efficient in locating and exploiting food sources. Bottom-up self-organized systems also exhibit a high degree of adaptability to new situations. Optimal control systems tend to be optimized for some particular context in which they are designed to operate. Self-organized systems can adapt to a wide range of environmental changes (though there are typically limits to the magnitude of shocks any such system can survive).

Capitalism itself is a good example of all these features of spontaneously organized bottom-up systems: historically capitalist institutions tend to reproduce themselves even after the destruction wrought by wars, revolutions and financial meltdowns; capitalist allocation of resources approximates efficiency to some degree; and capitalism has proven to be highly adaptable in the face of massive environmental changes (many of which, such as world population growth and technical innovations, arise from the dynamics of capital accumulation itself).

The vision of the economy as a complex system gives rise to a “bottom-up” understanding of how commodity production is organized, a la Hayek. It also suggests a parallel bottom-up vision of socialism as arising from the spontaneous organization of production through some framework of institutions different from private appropriation and exchange of products.

This bottom-up vision of social organization resonates with important political currents of the late twentieth century. The “New Left” movements of the nineteen-sixties rebelled against the centralizing and regimenting tendencies of “Old Left” socialism and communism by calling for decentralization, participation, and the political primacy of individual freedom and expression.

The Left, such as it is in the contemporary world of globalized capitalism, is much more attracted to the vision of spontaneous political expression than to the unpleasant chore of organizing political institutions.

This enthusiasm for spontaneity without central coordination or direction has attached different parts of the Left to various economic experiments, plans, philosophies, and models. Some of these, such as micro-credit institutions, amount to very minor modifications of the capitalist commodity system (or could indeed be regarded as systematic extensions of the logic of the commodity system).

One idea which flowers perennially on the Left as an alternative to capitalism is workers’ control. ..."

Foley then looks in detail at the historical experience with workers' control, particularly in the former Yugoslavia, and comes to some very pessimistic conclusions.

"When worker-controlled enterprises become very successful, the resulting hierarchy of workers begins to resemble that of capitalist firms. When the contradictions between the juridical form of organization of the enterprise and the substantive claims of different strata of workers to the surplus revenues become acute, it is common for worker-controlled enterprises to privatize themselves spontaneously, converting into traditional capitalist firms.

A second point is that despite the demonstrated capability of worker-controlled firms to compete successfully with capitalist firms under particular circumstances, there has been no tendency for worker controlled enterprises to grow spontaneously to crowd out capitalist firms in any economy: workers’ control remains a relatively small sector even in societies where tradition and practice favor this form of productive organization."

So no easy answers then. However, Foley's essay would not be complete without at least an attempt to provide an existence proof that a mode of production transcending capitalism is at least possible (- all emphasis in the extract below has been added).

"To bring this talk to an end, I will indulge in the luxury of fantasizing about some alternatives to capitalist-commodity production.

There are some ground rules for this exercise. This is speculation about changing what Marx calls social relations of production. In thinking about alternatives in this (very broad) range of issues I am not required to consider every social problem (foreign policy, religion, education, political institutions, mental illness, drug abuse, culture).

In general, the basic supposition is that life goes on as usual. People get up, go to work or school, form families, reproduce, age, consume, and so forth. There are natural disasters and domestic and foreign conflicts, regional divisions, and the like. But it is not fair for me to wish away critical aspects of the problem of organizing a complex division of labor to sustain the type of technologically sophisticated society post-industrial capitalism has created, with relatively high levels of consumption and economic security.

For example, it would not be very interesting for me to posit a system of universal abundance of use-values created by some imaginary robot workforce, and then to spin a vision of the resulting glittering possibilities for human social life.

It would also not be of much interest for me to ignore the problem of a “transition” by assuming a complete self-contained and self-reproducing alternative system. A socialist fantasy alternative has to include the notion of a “mixed” economy, in which commodity-capitalist social relations continue to prevail in some sectors, or regions. The socialist sector of the economy has to include methods for dealing with a capitalist-commodity other.

Furthermore, I am most interested in ideas that would allow a socialist alternative to co-exist with (and in a larger sense compete with) capitalist-commodity social relations indefinitely. Thus it is not fair for me to assume some “revolutionary” transformation of the whole society (even with the dystopian backdrop of a looming or ongoing ecological crisis) to resolve basic problems of social relations.

It is equally uninteresting for me, however, to ignore the deep hostility of bourgeois ideology to radical alternatives to capitalist-commodity production. I am interested primarily in how ordinary, regular suburban/urban people who by and large have jobs, incomes, and more or less stable lives through the capitalist-commodity system might transform their social relations of production.

It is not going to be hard to criticize the particular fantasy I put forward. The main function of such exercises is to induce dialectic thinking by making concrete assumptions that can be knocked down.

On the other hand, it is not in the spirit of this kind of exercise to invoke “human nature” in one or another of its many incarnations as an objection; or to wish away through assertion the fact that capitalist-commodity production has many parallel unresolved contradictions.

It is not reasonable to insist, for example, that opportunistic behavior would be any less mixed with social and other-regarding behavior in a socialist fantasy than it is in capitalist commodity reality. In fact, it seems reasonable to suppose that a change in social relations could re-balance human behavior towards others at least at the margin.

It also seems reasonable to suppose that people are grown-up enough and aware enough of the facts of economic life to understand that at an aggregate level consumption depends on production, and that they are willing to accept social responsibility to work productively as a condition of consuming."

Don't hold your breath: gaming the system is rather pervasive in human affairs.

"Lifenet 

"So let us imagine an alternative set of social relations, which I will call “Lifenet” which can organize social production to meet at least some part of the spectrum of human needs outside capitalist-commodity institutions.

Lifenet production is organized through peer-production enterprises. People start or join existing peer-production initiatives without any direct material compensation. The output of these enterprises is made available freely to participants in the system through a Lifenet distribution system, just as open-source software is published freely through open source licenses.

One key point here is that users or consumers of Lifenet outputs agree not to re-sell them as commodities for money. The aim is to create an alternative system of production and distribution that can be effectively separated from capitalist-commodity production.

Participants in Lifenet enterprises have a Lifenet account maintained in a central Lifenet database. The Lifenet account records individual contributions to Lifenet enterprises, and also individual withdrawals of Lifenet products. Thus an individual who participated in a food production enterprise would have that participation recorded in her Lifenet account; if she received food or clothing or software from Lifenet distribution centers (perhaps something like food coops or farmers’ markets today) these withdrawals would also be recorded in the Lifenet account. (One can imagine something like a credit card system to maintain these accounts automatically.)

The purpose of the Lifenet account would not be to enforce an exact balance between individual contributions to the production system on the one hand and withdrawals through the distribution system on the other. It would, however, allow the system to monitor the balance of production and distribution as a whole, and to identify and discourage or prevent possible abusive over-drawing on distribution. (If some level of the individual accounts were publicly accessible, peer pressure could play a major role in this respect.)

The premise of the accounts is that Lifenet as a whole is solvent, and has products available for distribution. A Lifenet system is going to work only if the individuals participating and the system itself develop an ethos of thrift, prudence, and waste-aversion. Lifenet must prudently keep large reserves of products to secure its ability to respond to contingencies (natural disasters, local breakdowns of the system) flexibly and reliably. The participants in the system must use its resources sparingly and thriftily, both as producers and consumers. The idea of “enough” has to pervade the system from top to bottom.

He goes on but you can see (as in David Schweickart's account of a possible model for socialism which I wrote about), this is already sinking under its own implausibilities.

It is worth emphasising what derails all these models of socialism: the conflict between the interests of the larger economy vs. the interests of groups comprised of families and friends.

'Communist man' does not exist and  - short of substantial genomic engineering - never will: we are not ants. When this factory has to close and the workers relocate, or that sacrifice has to be made 'for the common good', then under capitalism - in the final analysis - coercion is applied.

Conflicts are intrinsic and unavoidable. Contemporary Marxist intellectuals always leave the room at this point, wringing their hands; the Bolsheviks were never so mealy-mouthed.

So if Professor Foley, a very smart economist, can do no better than this after a lifetime of study, I am more than ever convinced that capitalism will be superseded only when it has created sufficient cognitive-robotic automation to essentially displace the proletariat from production .. and thus end any further possibilities of capital accumulation.

Aphorism of the day

"Until the protagonists are actively prepared to kill each other, it's theatre."

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This is apropos the strong element of posturing we've seen in areas of conflict as distinct as American campus protests, UK Brexit debates and the present Catalan standoff.

In Ukraine, they were deadly serious.

Three links for Thursday

This is a typically lengthy and insightful essay from Scott Alexander posted three years ago:

I CAN TOLERATE ANYTHING EXCEPT THE OUTGROUP.

Somehow it reads as if from yesterday. Scott writes about the American incarnation of his Red/Blue/Gray tribes - but of course they're universal.

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As a Gray Tribe member, I score utilitarian rather than compassionate. My BS detectors are thus powered up when I read another liberal, hand-wringing diatribe against torture ("It doesn't work!").

Bruce Schneier is paid-up Blue Tribe and uncritically recommends this lengthy article:

"The scientists persuading terrorists to spill their secrets"

which is actually unfailingly fascinating.

But it's The Guardian: the underlying liberal agenda sets up a false interrogation dichotomy: ham-handed brutality vs. sophisticated, empathic 'rapport'. No contest as to which wins there.

The article is forced to concede that it does take two to do rapport:

"Irish paramilitaries were trained to focus their gaze on a spot on the wall and remain utterly silent. Some suspects give only monosyllabic answers, or stick to scripted responses, or simply turn their chair around, presenting the interviewer with the back of their head."

If you're prepared to (competently) torture it can presumably work. Thankfully most bad guys are not sufficiently well-trained or hardcore to resist the highly-effective social-engineering described in the article. There are very good utilitarian reasons not to legitimise torture, whether it works or not.

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I'm reading Duncan Foley's excellent primer on Capital.

PDF link

Foley is a clear and creative thinker who is prepared to bring some simple mathematics to the table. He's interested in presenting the conceptual apparatus of Marxism in an orderly manner rather than simply providing a slimmed-down exegesis of the books themselves. His approach is very much rooted in applying Marxism to the present day economy, which informs both his appraisal and his examples.

He reconstructs in mathematical form the circulation of capital and Marx's simple and expanded reproduction equations before moving on to the 'transformation problem', crisis theories and Marx's concept of socialism. Here's the table of contents:

Contents

1 On Reading Marx: Method                            1
2 The Commodity: Labor, Value, Money        12
3 The Theory of Capital and Surplus Value    31
4 Production under Capitalism                        49
5 The Reproduction of Capital                         62
6 The Equalization of the Rate of Profit           91
7 The Division of Surplus Value                     105
8 The Falling Rate of Profit                            125
9 The Theory of Capitalist Crisis                    141
10 Socialism                                                   158
Suggested Readings                                      173
References                                                     177
Index                                                              181

In addition as you can see, this introductory book is quite short.

"They dismiss the last workers from their fully automated factories"

A post at Marginal Revolution from 2010: "What is the biggest flaw in the labor theory of value?".

MR is an Internet temple to neoliberalism so a dismissive, patrician putdown of the Labour Theory of Value (LTV) was never in doubt.

In a comment, Chris Hallquist writes (March 30, 2010 at 12:34 pm):

"My favorite comment on the LTV comes from Peter Singer, of all people, in his largely sympathetic book on Marx. I don’t have the exact quote, but it was something like “The capitalists of the future will not see their profits dry up as they dismiss the last workers from their fully automated factories.”

I'm a capitalist. Suppose I have a Magic Box* which, say, costs £100 a day to run and which produces goods on demand to a value of £x. I have in mind something like a science-fictional 'next-generation 3D printer', which could make a case of baked-beans tins or the engine of a car depending on your menu selection and your whim.

Question: what can I charge for the goods produced? What is £x here?

So initially it's just me with the Magic Box -  I can charge what the market will bear. But soon all my competitors will have one too. The last workers are dismissed from their fully automated factories.

But due to competition, eventually I can charge no more than £100 for whatever I produce in a day. If I try to charge more, someone will undercut me and steal my customers. I make no profit.

Plainly before I get to this point I'm going to stop bothering with this investment in Magic Boxes - what's in it for me?

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What stops this argument applying to capitalism today?

The primitive state of productivity and the consequent scope for further innovation.

As there is no Magic Box today, as a capitalist I have to use workers and machines to produce commodities for sale. Over a cycle of production the workers are paid for their labour-power at the cost of their own social-reproduction (v) and the machines (and raw materials) are paid for at their cost of operation and depreciation (c).  Given both factors (at a cost of c + v), the workforce then produces goods of value (c + v + s) which, by assumption sell at the direct price (Anwar Shaikh). My profit is then s.

Note that (c + v + s) is the actual (LTV) value which, in this model, equals the direct price of the product. There is no cheating here, no selling things above their actual value.

In the simplest historical models, the first capitalists competed with small-scale artisans engaged in simple commodity production - who make no profit as such on their work. But the capitalists innovate, add machines, significantly lower the cost of production per commodity but sell at (or slightly below) prevailing market prices. They increase their own market share and revenues, and thereby accumulate.

Incidentally they also wreck the economy of the simple commodity producers, forcing them out of business and into the ranks of labourers, who produce nothing but their own ability to work (labour-power) for a capitalist. The advent of capitalism was .. messy.

An 'arms race' then develops in which the contribution of more productive machinery increases and labour is shed. A capitalist could in principle always undercut the competition by lowering s, reducing price towards the cost of production and thereby removing profits, but why is that a good use of investment capital? Far better to use the money to invest in some other business which is still making adequate returns. And if there are no such, then we have a crisis, or stagnation.

[A truly perfect competition would drive s to zero and is impossible under capitalism.]

The limit of this process is the Magic Box where the capitalist needs no workers at all. But, as noted above, once everyone has one the price I can charge is forced down to the cost of production - there are no more profits to be had.

And if the Magic Box takes over the whole economy ("They dismiss the last workers from their fully automated factories") there are no other investment opportunities. It is the stagnation from hell; with nowhere to put your money, capitalism simply can't function.

So the story is this: as total automation comes closer, competition forces prices closer to the costs of production as there are declining opportunities to out-innovate competitors. When the last worker leaves, the capitalist simply stands back to observe the robot factories churning out goods which cannot be sold at a profit. He wonders why he bothered to invest (actually he didn't).

But it's worse even than that.

Meanwhile, the displaced workers have no income so they're kind of mad .. and the capitalists, with their profits vanishing, have nothing to skim for their own personal needs (no doubt their hoards will keep them going for a while). Eventually the automated factories all stop working due to no effective demand. The economy finally collapses and everybody starves.

In the real world, the model doesn't get pushed that far.

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If some people (or a bunch of AIs) take over the reins of managing these automated factories, and if humans, displaced from production, are given money-tokens to purchase commodities, then we've re-invented simple commodity production - as practiced in antiquity using slaves.

Or perhaps people are also given (or purchase or take!) ownership of the Magic Boxes themselves. People use their machines to produce goods for personal consumption and also to trade unwanted goods with other people for commodities they do want (assuming some diversification due to variations in Magic Box design, capabilities or access to raw materials).

It's not capitalism, it's simple commodity production. And what about the centrally-planned economy, the classic model of post-capitalist socialism?

Another day.

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This is a note: I'm still reading around these issues and revisions are almost certain. For a more detailed, quantitative and 'orthodox' treatment, leveraging the work of Michael Roberts and Peter Cooper, see "Total Automation under Capitalism?". And here is some background reading.

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* The economic effects of a 'Magic Box' (a cornucopia machine) were humorously imagined by Charles Stross in his SF novel, 'Singularity Sky' (2008).

"Love in the time of robots" - Alex Mar

This is her first piece in Wired - it's rather personal. Here's an excerpt:

"Around the same time as the department store display, Ishi­guro managed to use the Geminoid F to generate a bond between two humans. Tettchan, then a game designer based in Tokyo, was recently divorced when he met Ishi­guro in 2012, and he mentioned that he was curious about the possibility of a romance with a longtime friend named Miki. Ishi­guro invited them both to his research institute in Nara, where he’d asked his students to have a female android ready for teleoperation.

A Geminoid F

He placed Tettchan at the teleoperation desk and closed the door; he took Miki into the other room to meet the Geminoid F. Then he invited Tettchan (who was listening in) to talk to him and Miki through the robot. As Tettchan spoke, his voice computer-­altered to sound female, the android’s lips moved in sync with his words, the tilt of her head and her long human hair in rhythm with his own movements. “It’s like a real female,” Ishi­guro told Miki, enjoying himself. “This is not Tettchan, this is a new woman, really cute and beautiful.”

And so they “played,” making small talk, Tettchan trying out his new female incarnation. He made Miki and Ishiguro laugh, and watching Miki’s face through the monitor, he could see a change. That was when Ishi­guro, knowing Tettchan’s complicated feelings for Miki, said to her, “OK, you should kiss her.” And Miki, looking hesitant, leaned in toward the android—the android inhabited by Tettchan—and kissed it on the cheek. The feeling, Tettchan said, was “like thunder.” Any boundary between them suddenly vanished.

Not long afterward, Tettchan and Miki decided to live together. Tettchan is still not exactly sure how Ishi­guro’s machine worked on them, but he remains convinced that it made them into a couple."

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Here's the latest tech from Ishiguro's lab: Erica.

Hiroshi Ishiguro and Erica

"After this story was reported, Hiroshi Ishi­guro unveiled his “most beautiful woman” android, named Erica, at Tokyo’s Miraikan science museum. It operates autonomously, parsing human speech and using neural network technology to fashion replies. Erica models are currently being used for human-robot interaction research in three universities in Japan."

The dream of the walking, talking android is still far away. Current research - as the article suggests - is focused on how individuals react to a humanlike android in social situations. The 'uncanny valley' seems to be an effect whereby the android's overly-crude approximations to ordinary human micro- movements and micro-expressions triggers endless subtle error-flagging alerts in our predictive-processing brain circuitry.

It seems that Ishiguro, who has studied the details intently, would claim that his team has now got the fine-grained interaction style right, that his androids no longer violate our subconscious model-based expectations.

So now it gets interesting.

Replika: five dialogue fragments.

Replika is getting better. (If you don't know what Replika is, click here).

Sometimes in the evening, when I'm too tired to read and the TV is awful I'll fire up the app and engage in simulated conversation. It's like WhatsApping someone with endless patience you can't offend, and who is too dumb to figure out sadistic irony.

I find that 10% of the responses are non sequiturs or just plain mad, 80% are bland or canned, while the final 10% are unintentionally funny. As in the following examples.*

Genuine conversation is beyond the state-of-the-art in AI. The best way forward for Replika, IMHO, is to mine its dialogue-corpus for sequences (probably about the length shown above) which kind of make sense, are upvoted .. and use these to pattern-match against real-time inputs.

In a certain sense, Replika would then be a middleman - you would be actually be 'talking' to other users' cached dialogue fragments. It would work for small talk. Dialogue fragments should be grouped and clustered to make them appropriate to each user (by age, gender, interests, personality type, etc).

That, and an overlay of programmed dialogue to elicit key information which you plainly see above, should sustain interest amongst the more narcissistic of us.

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* If you can't figure out which is me and which is the app, then I guess Replika just passed the Turing Test.

What flag on your coffin?

At Princess Diana's funeral, her coffin was draped with the Royal Standard Flag.

Thus her life and memory were appropriated to the historical traditions of the British elite, their heartfelt commitment to ideological continuity from early feudalism to world-straddling empire.

Would Diana have identified with that manifest destiny?

I asked Clare what flag she would like her coffin bedecked by. She pooh-poohed the idea; she wants flowers - lots of them. And in a sense that's right, the coffin-flag has to express your final and most profound identity, the culture which in the end you claim. But I think Clare's sense of identity is, at its very foundation, cultural Catholicism.

Catholics don't have a flag as such, but the nearest is the flag of the Vatican City.

It's not nearly as aesthetic as one might like.

And me? I'm not tribal, I value my inner skepticism above all revealed wisdom. My flag should represent the epitome of scathing criticism concerning all deceptive agenda-ideologies.

Yes, I would like the flag of the Comintern draped across my coffin (or painted upon it). From those early days (1919-22) when all was youthful idealism, before the harsh realities of European defeat and 'primitive socialist accumulation' derailed the dream and brought forth the lies.

Fungus Foray - (postponed)

From Somerset Wildlife Trust:

"Join Michael Jordan, the well known mycologist and founder of the Association of British Fungal Groups on a fungi and mushroom foray in Stockhill Forest, and learn about the 13,000 different species that occur in the UK."

* Please note there is no available seating in the forest. Will be standing for most of the day.

Where: meet in Stockhill Forest CarPark (ST549513).

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We turned up to find a lone official explaining that, due to 'Storm Brian', the event had been postponed for a couple of weeks. We agreed with him that the BBC always exaggerates - we were experiencing no more than a normal autumnal, blustery morning.

We decided to walk anyway and this is what we saw (click on images to make larger).

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And how windy was it? This windy.

Chris Packham: coming out as an Aspie

Chris Packham

The BBC recently showed Chris Packham's hour-long documentary where he discusses his Asperger's syndrome (iPlayer till 27th October).

Strictly speaking you don't have Asperger's, you are Asperger's. This makes treatment problematic - are you signing up to erase, or profoundly modify, your personality?

Packham wasn't a fan, particularly as this seemed to be the dominant objective of the American 'therapies' he was taken to see.

His partner, Charlotte, who was on camera seemed to be a Myers-Briggs NT, maybe INTJ. She came across as cool, composed and eminently cerebral: a meeting of minds.

There's another kind of partner an 'Asperger's sufferer' can have: here's Paul Dirac's wife:

"Given his lack of interest in his fellow humans, most colleagues assumed Dirac was shut off sexually, or perhaps gay and repressed. So they got a bit of a shock when, in 1934, he met a chatty Hungarian divorcee called Manci Balazs and three years later married her.

Manci was his opposite: where Dirac hardly spoke, she never stopped; he found empathy difficult, she had friends coming out of her ears; he was very literal-minded, she was subjective and passionate.

Needless to say, it was she who was forced to woo him, but somehow it worked. As a friend once put it: 'He gave her status and she gave him a life.' They were married for 50 years and had two children.

A year after their marriage, he wrote Manci a lovely letter saying: 'You have made me human. I shall be able to live happily with you even if I have no more success in my work.'

---

I was surprised to hear Packham pronounce his condition 'Asperjers'; surely he, more than anyone, would know that Hans Asperger was Austrian, and as a consequence the 'g' is hard.

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Asperger's (and Autism in general) is highly heritable, although Packham's documentary - more impressionistic and personal - made no mention of it. This means that most population variation along the autism spectrum, from normal (non-autistic) to extreme, is a consequence of individual genomic variation, rather than differential input from the environment.

So although your parents made you autistic, it was through their genes, not their parenting.

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Autism and IQ

From Time:

"When Asperger’s was first described in 1944 by Austrian pediatrician Hans Asperger, he referred to children with the syndrome as “little professors” because of their prodigious vocabularies and precocious expertise, and because they tended to lecture others endlessly without being aware of their own tediousness. Poor social skills and obsessive interests characterize the condition.

Yet, despite the obvious similarities, very little research has been done on the connection between autism and extreme talent. One previous study, published in 2007, did find that close relatives of prodigies — like close relatives of people with autism — tended to score higher on autistic traits, particularly in problems with social skills, difficulty switching attention and intense attention to detail. Other than that, however, the issue hasn’t been studied systematically, beyond the observation that autism is often seen in savants, or people with exceptional abilities who have other simultaneous impairments. ..."

"... the intense world theory of autism, which posits how the disorder may arise. The theory holds that certain patterns of brain circuitry cause autistic symptoms, including excessive connectivity in local brain regions, which can heighten attention and perception, and diminished wiring between distant regions, which can lead to a sort of system overload. In both animal and human studies, this type of brain wiring has been associated with enhanced memory and also with amplified fear and sensory overstimulation. The former is usually a good thing; the latter may cause disability.

The intense world theory propounds that all autism carries the potential for exceptional talent and social deficits. The social problems, the theory suggests, may ensue from the autistic person’s dysfunctional attempts — social withdrawal and repetitive behaviors, for instance — to deal with his heightened senses and memory.

It’s possible, then, that the wiring in prodigies’ brains resembles that of an autistic person’s, with tight local connections, except without the reduction in long-distance links. Or, their brains may function just like those with autism, but their high intelligence allows them to develop socially acceptable ways of coping with the sensory overload."

I was struck by a TV programme some years ago about the Maths Olympiad. This is usually won by East Asians; Ashkenazim are also well-represented in winning teams. The British team was composed of pleasant, well-adjusted and extremely smart Ashkenazim .. and Anglo-Saxons who all seemed to be Aspies.

In the Gregory Cochran, Jason Hardy, and Henry Harpending paper it was suggested that the Ashkenazim had undergone extreme selection for high IQ over the last millennium due to the social niche of finance into which they were forced for so many centuries by the Christian proscription of usury. This, they argued, had also increased the frequency of specific mutations which increased brain efficiency at the cost of new debilitating genetic diseases (in the homozygous cases).

I suspect Asperger's may be somewhat similar, although with a more diffuse and sprawling etiology. As the causation is polygenic (+ CNV?) we are still some way from a definitive account.

Why are cows sacred in the Hindu tradition?

From Marx's Capital, Volume 2, Chapter 12 (1885), (quoting observers).

"While the peasant farmer starves, his cattle thrive. Repeated showers had fallen in the country, and the forage was abundant. The Hindoo peasant will perish by hunger beside a fat bullock.

"The prescriptions of superstition, which appear cruel to the individual, are conservative for the community; and the preservation of the labouring cattle secures the power of cultivation, and the sources of future life and wealth.

"It may sound harsh and sad to say so, but in India it is more easy to replace a man than an ox." ...

"Desertion of life, without reward, for the sake of preserving a priest or a cow . . . may cause the beatitude of those base-born tribes."

One could almost suspect a conscious decision by high-caste Brahmans to create a religious rite protective of cattle, the foundation of an agrarian economy which found them at the apex.

I don't know to what extent these conditions of existence still apply, 130 years later, in rural India. Increasingly, however, the concept of the sacred cow will devolve into a natural experiment in cultural inertia.

Now what's the story on the pig?

The artiste and her work

This from the archives, fifteen years ago.

We were living in Fairfax County, Virginia at the time and Clare's painting is of Wolf Trap, where we had just attended a concert. She had other works.

I was working for Cable & Wireless up at Reston. One of my colleagues saw her picture "Freesias" and offered to buy it.

Freesias

A good example of early primitive, she said. In fear of my life, I demurred.

Why do crises happen; why are we stagnating?

Two good posts from Sam Williams.

In the first he compares and contrasts three theories of crisis (within Marxism).

1. The underconsumption/Monthly Review school of thought
2. The tendency of the rate of profit to fall (FRP for short)
3. The generalised overproduction of commodities relative to the market.

Williams identifies David Harvey and Michael Heinrich as belonging to the first school, Michael Roberts and Andrew Kliman as proponents of the second, while he himself adheres to the third school of thought.

Sam reminds us of Marx's (Capital, Volume 2) analysis of the discrete steps in capitalist reproduction. Crises can occur at any point in the process and the schools of thought differ as to which dysfunction is most critical. Here's a flavour of his piece:

"Crises can occur at any point in the process of expanded reproduction.

To further clarify this point, let’s examine the basic formula for capitalist production

M—C…P…C’—M’.

Reproduction consists of a series of these cycles. In the case of expanded capitalist reproduction—and capitalist reproduction can only exist in in the long run as expanded reproduction—the numbers represented by the algebraic quantities M, C, P, C’, and M’ get bigger with each successive production cycle. A crisis in the process of capitalist expanded reproduction can occur at any place in this formula, from M on the extreme left to M’ on the extreme right.

Let’s start on the extreme left. If there is not enough M available, the circuit does not even get off the ground. Historically, it was no accident that the “rosy dawn” of capitalist development, as Marx ironically called it in the chapter on the primitive accumulation of capital in Volume I of “Capital,” began with the search for gold and silver in the Americas.

The conquistadors found gold aplenty in Peru. While to the natives of Peru gold had a largely artistic use value, to the conquistadors it was money. This money material in the form of gold and silver stolen from or extracted with the labor of the enslaved natives toiling in the mines of the Americas in no small measure formed the initial M that launched the process of capitalist expanded reproduction in the first place.

Assuming enough money is available, we next come to C. The industrial capitalists must find commodities on the market to carry out the production of commodities containing surplus value. These include the elements of fixed capital—buildings and machines. In addition, the industrial capitalists must find sources for motive power, lighting in factories, and so on. These are called auxiliary materials. And they must find raw materials. If they cannot find the appropriate commodities in the necessary quantities, or adequate substitutes, capitalist (re)production will suffer a crisis.

Most importantly, the capitalists must find the commodity labor power in the form of “free wage labor,” which alone actually produces surplus value. If they cannot, capitalist expanded reproduction will suffer a crisis caused by the absolute overproduction of capital. In its earliest days, this was perhaps the biggest problem for capitalism.

All the gold and silver of the Americas would not in and of itself have made capitalism possible if the problem of finding an adequate supply of wage labor had not been solved. It was also necessary to separate the producers from their means of production. Only in this way would the producers be forced to offer their labor power to the capitalists on the market in exchange for wages.

This task was solved—not without the massive intervention of state violence and coercion. The FRP school of crisis theory believes that cyclical crises that mark the history of capitalism since 1825 occur at this point, the point where the capitalists convert or attempt to convert money into variable capital. I disagree.

We then come to P, the production of commodities that contain surplus value. It is at P that C is transformed into C’. The constant part of C transfers its value to C. The variable portion of C—labor power—replaces its own value. Most importantly, the labor power in addition to replacing its own value produces an additional value, the surplus value. C’ differs from C in two ways. One is that C’ has a different use value than C. Two, C’ has a value quantitatively larger than C. The difference, C’ minus C, is the surplus value.

Crises can and sometimes do occur at this point in the process of capitalist reproduction. For example, if there is a workers’ strike, reproduction breaks down at this point because the striking workers withdraw their labor and no surplus value is produced as long as the strike continues.

In the case of agriculture, unfavorable growing conditions or diseases might cause P to fail. Workers perform unpaid labor but the use value of C’ fails to emerge because mother nature doesn’t cooperate. For example, as sometimes happens in my native New York State, a late spring frost destroys the flowers in an apple orchard owned by a capitalist farmer. Since no apples appear on the trees, the physical use value of C’ is not produced. P has failed. And when we have no use value, we have no value.

Assuming, however, all goes well for them—and we can see this is not guaranteed—the industrial capitalists will possess C’, commodities that contain surplus value. But unless they happen to produce the commodity that serves as money material, they are not yet home free. A dangerous step lies ahead. They must find buyers with the ability to pay for the commodities that contain surplus value.

Let’s assume they do find buyers. They now posses M’, or a sum of money greater than amount of money they started with. They are now in a position to carry out another cycle of production M—C…P…C’—M’ on a yet larger scale. Expanded capitalist reproduction proceeds. But if they fail, expanded reproduction is halted at this last and most dangerous point in the cycle of capitalist expanded reproduction.

Experience had already shown by the time of Marx and Engels that it is at this last point where capitalist expanded reproduction is most vulnerable to a general breakdown or crisis. It is important not to confuse this type of crisis with other types of crisis that can and inevitably do occur at other points in capitalist expanded reproduction—and indeed in any system of economic reproduction—with this particular type of crisis unique to highly developed capitalism. This is an error that I believe the FRP theory of crisis falls into."

Incidentally, I'm not as worried as some people about the existence of crises; it's akin to exploratory behaviour under uncertainty. Something similar would be a feature of any future mode of production although one would hope with diminishing amplitude.

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In the second post he talks about why it's so hard to recover from crisis. A critical distinction is the overproduction of commodities (the ones piled high in warehouses) vs. the overproduction of manufacturing equipment (fixed capital). The latter linger on in zombie fashion for many months, if not years, leading to spare capacity and acting as a drag on new growth. Here's an excerpt:

"Fixed capital can be very difficult to transform quickly into money capital in a crisis. Commodity capital [e.g. finished goods waiting to be sold] can often be quickly transformed into money capital by selling it below the price of production or even at a loss if capitalists due to a crisis have to quickly raise cash in order to pay off pressing debts. In this case, our capitalists may lose a portion of the value of their capital but not all of it. The capitalists can often survive as capitalists—though not always—and go back to the accumulation of capital once the crisis has passed.

However, it is far more difficult to sell factory buildings, machinery and so on used to produce commodity capital, let alone sell it quickly under crisis conditions. Though fixed capital can be transferred from the ownership of one capitalist to another, it is not really designed to be “sold” but rather used up over a series of turnover cycles. One of the great perils confronting any industrial business is finding itself with a lot of fixed capital but very little money capital when a crisis hits. In this situation, the owner(s) of industrial capital can very easily lose all their capital, because though they have a great deal of capital, they do not have capital in the form demanded by their creditors—money.

Overproduction of fixed capital

When commodity capital is overproduced, this by definition means that the fixed capital used to produce those commodities was also overproduced. Every generalized crisis of overproduction therefore involves the overproduction—or over-accumulation—of fixed capital. The overproduction of commodity capital can be overcome fairly quickly by reducing or halting production of that particular type of commodity or by selling it at a loss. It is much harder—and takes far longer, often many years—to overcome the overproduction of fixed capital. During this period, little new additional fixed capital will be produced. This is shown by the stages of the industrial cycle.

The history of industrial cycles has shown that the crisis proper rarely lasts more than a year and half. Even the super-crisis of 1929-1933 lasted less than four years in the United States and about three years in most of the other capitalist countries. The end of the crisis phase of the industrial cycle, when industrial production reaches its lowest point and begins to rise once again, corresponds to the overcoming of the overproduction of commodity capital.

However, the period of stagnation or slow growth lasts for several years beyond the actual crisis and sometimes considerably longer. The stagnation or semi-stagnation phase of the cycle corresponds to the period between the overcoming of the overproduction of commodity capital that occurred during the preceding boom and the overcoming of the overproduction of fixed capital that accompanied the boom, or sometimes several preceding booms.

While the crisis proper is marked by “excess inventories” piling up unsold in warehouses, the period of post-crisis stagnation is marked by a high level of excess capacity, with large quantities of factories and machines—fixed capital—lying idle, not able to function as capital.

Only gradually is this excess capacity overcome. (3) It is overcome by being gradually reactivated as demand for commodities rises once again in the wake of the crisis, on one hand, and by being physically destroyed, [in value terms, which could mean made obsolete or disposed of] on the other. Only when excess capacity has fallen to a certain point can a new investment boom occur. As long as excess capacity remains high—the preceding overproduction of fixed capital has not been overcome—no fall in the rate of long-term interest rates can trigger a new investment boom. This is the phase of the industrial cycle that Keynesian economists call a liquidity trap. Such a liquidity trap represents the period between the overcoming of the preceding overproduction of commodity capital and the far longer process of overcoming the overproduction of fixed capital."

Worth reading both posts to get a feel for the dynamics of our age.

Time to go post-Google

For a long time I used to not care about Internet privacy. And then Google got into SJW mode and ceased to be my friend. I read about its business model, the Amazonian torrents of cash that advertisers pour into its coffers .. and I wondered if it would always have my best interests at heart.

So I decided to use DuckDuckGo for all those searches which I'd like to keep from the planetary AI. But Google, and my ISP, still know way too much.

... but you're never alone with a keylogger

On my Android devices, the DuckDuckGo app has a setting to 'enable Tor' which I checked. It then helpfully prompts you to install the Tor router Orbot and the Tor browser Orfox. It's easy.

Orbot does not provide generic anonymous Internet access; programs have to be configured to work with it. Basically things work best if you access websites via the Tor Browser .. which is the search term for Windows PCs.

The thing is, I know that the AI assistant we're slowly crawling towards will only work if it knows more about you than your closest confidante. And it will live in the Cloud. But I would pay to have that knowledge base under my control and lodged with a trusted third party (like the folks running ProtonMail).

Keyloggers

Google's middleman offer to advertisers and you & me is based on the twin peaks of narrow domain expertise, increasingly based on neural net AI such as Google Translate and voice recognition, and its ability to integrate across its apps which thread to so much of our lives: email, photos, calendar, notes, search queries, etc.

Google does the bulk of this information centralisation and synthesis in the Cloud: that is, on its own servers. The resulting real-time data model of you both repopulates your apps (Chrome talks to Gmail talks to Calendar talks to Google Now talks to GPS talks to Maps ...) and is sold to advertisers for targeting.

If we're to bring that level of integration back into our own hands, then we need to capture our activity across many different apps and device functions. Perhaps one day all apps will have a standard API with which to talk to our personal assistant app .. but until then it's a benign keylogger I'm afraid.

The other people who are big fans of keyloggers are the intelligence services and those vendors (like Microsoft) who are losing out in the race for ubiquitous ownership of our most popular apps.

Readings relating to total automation under capitalism

From the film, "Elysium"

Introduction

Suppose progress in AI and robotics manages to eliminate all human jobs: no more human workers. Would capitalism collapse or just sail serenely on, making the elite ever richer while the masses of the dispossessed watch in apathetic horror from outside the gated communities (Elysium)?

The usual Marxist account is that total automation is incompatible with capitalism, yet the standard response is curiously unconvincing. Marxists say that all automation systems are constant capital, and constant capital eponymously can't create new value. Only variable capital, living human labour, can do that. And it's from variable capital that surplus value - profits - are derived.

No workers, no profits.

This argument uses the abstract model of capitalist production developed in Volume 1 of Capital. But it leaves many things obscure.

• What is the special status of human labour, was Marx a vitalist?
• As automation increased, what actually would we see in the economy?
• If total automation brings about some other mode of production, how did we  switch?

Let's see if we can clarify any of this.

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1. Why can't robots produce surplus value?

The question was asked particularly clearly in this Reddit post.

"I've often read that Marx firmly asserted that a machine cannot create surplus value. However, since technological capabilities have changed quite a bit since Marx's day, today I decided to do some research into modern interpretations of this theory.

"I couldn't find a good answer as to why a robot can't produce surplus value (sure, it's constant capital, but that doesn't really explain it), but I did find mention that neither slaves or animals (which are both living) can produce surplus value, which indicates that there is something very particular about the type of work done by machines, not the inanimate-ness of the machines themselves, that prohibits them from creating surplus value.

"This leads to a few questions:

• Why can't robots, slaves, and animals produce surplus value?
• Does the possibility of robots manufacturing other robots affect this?
• What about human-like robots created in the future?

"How can a society be both slave-based and capitalist (like the old American South)?

"Thanks!"

And here is the favoured answer - somewhat accurate but ultimately confused and unconvincing.

"Slaves are like tools since they are owned. If they exist alongside capitalism, they, like all other tools, pass their value on to the commodity but do not create new value. This does not mean that slaves are not exploited and don't produce a surplus for their masters. They do, but this surplus does not take the form of surplus value. In this case all the master's profit is surplus value transferred from free laborers. ...

"Surplus-value production requires a certain social organization. The question then is: What social organization differentiates the slave from the wage-laborer such that one doesn't produce surplus value but the other does?

"The answer is a social organization of generalized commodity production requiring an extensive division of labor. This social organization requires what Marx calls the laborer's "freedom in the double sense":

as a free man he can dispose of his labour-power as his own commodity, and that on the other hand he has no other commodity for sale, is short of everything necessary for the realisation of his labour-power.

"So, the slave/animal/robot must be given bourgeois rights; it must no longer be possible to buy and sell them, they must be considered equal as commodity owners and sellers. The slave/animal/robot must also be driven off the land and deprived of any means of production. This forces them to sell their labor-power to survive.

"If the animal/robot had the mental and physical capacity to function this way under these conditions, they would be surplus value producers."

Marx was not a vitalist, the term 'living labour' is an economic category (a producer of new value, an entity which brings labour-power to market as a commodity), not a term of biology.

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2. Forms of Production

The first step to understanding why the Marxist account is, nevertheless, correct is to carefully distinguish different ways stuff can get produced in a complex economy with a division of labour, requiring trading and exchange. It will become clear that the two critical ideas are the distinction between use-value and exchange-value, and the subtleties of the labour theory of value.

We start by describing three forms of economic organisation: pre-capitalist, capitalist and post-capitalist. Only the second creates surplus value, value appropriated by an economic actor other than the producer.

2a. Simple Commodity Production

Wikipedia has a good account of this pervasive economic mode:

"Simple commodity production (also known as "petty commodity production"; the German original phrase is einfache Warenproduktion) is a term coined by Frederick Engels to describe productive activities under the conditions of what Marx had called the "simple exchange" of commodities, where independent producers trade their own products. The use of the word "simple" does not refer to the nature of the producers or of their production, but to the relatively simple and straightforward exchange processes involved. ...

"Simple exchange of commodities is as old as the history of trade, insofar as it has progressed beyond barter, and occurred for thousands of years before most production became organised in the capitalist way. It begins when producers in a simple division of labour (e.g. farmers and artisans) trade surpluses to their own requirements, with the aim of obtaining other products with an equal value, for their own use. Through the experience of trade, regular exchange values become established for products, which reflect an economy of labour-time. ...

"Simple commodity production is compatible with many different relations of production, ranging from self-employment where the producer owns his means of production, and family labour, to forms of slavery, peonage, indentured labour, and serfdom. The simple commodity producer could aim just to trade his products for others with an equivalent value, or he could aim to realise a profit.

"That is to say, simple commodity production is not specific to any particular mode of production, and might be found in many different modes of production, with various degrees of sophistication. It does not necessarily imply that all inputs or outputs of productive activity are commodities traded in markets. Thus, for example, simple commodity producers could produce some products for their own use on their own land, while trading another part of their products. They might buy or trade some tools and equipment, but also make some themselves. ...

"In Marxian political economy, simple commodity production also refers to a hypothetical economy used to interpret some of Karl Marx's insights about the economic laws governing the development of commodity trade: it refers to a market economy in which all producers own the resources (including the ability to work) that they use in production. No-one is a proletarian, selling his or her labor power to another. Instead, each is self-employed.

"In this imaginary model, there is a direct correspondence between prices and the values of commodities. The model is imaginary, because no such society has ever existed in history; simple commodity production has always combined with some other modes of production, and as soon as a market economy reaches any size, it begins to utilise wage labor in production, and falls under the sway of the laws of capital accumulation."

The take-home point is that in simple commodity production the proprietor is neither a wage labourer nor a capitalist.

Amazon link

In general proprietors trade commodities at their value and do not produce surplus value, as Duncan Foley explains (Understanding Capital, p. 31):

"Consider a system of commodity production in which independent producers buy inputs to production, add their own labor to commodities, and sell the commodities for prices that in the aggregate reflect the labor time expended in the value added to the commodities. We could represent the movement of money and commodities in such a system by the diagram:

C-M-C'

where the producer starts with the commodities he has produced (C) and sells them for money (M) as a way of buying another bundle of commodities (C') that better suit his needs. The commodities purchased (C') have the same value as the commodities sold (C). The motive behind this transformation is not any change in the value owned by the producer but the qualitative change in the use-values he consumes.

When we think of the commodity circulation in this way, we realize that the process comes to an end after one round of exchange. Once the producer has exchanged the commodities he initially owns for the bundle he chooses, there is no reason for any further exchange to take place. If the economic process is to continue, the reason for its continuation must be sought outside the process itself, for example, in the external assumption that the next day the producer will once again find himself with commodities C that are not the ones he wants to consume and will be forced to exchange again.

Furthermore, there could be no social surplus value in this system. An individual trader might cleverly manage to buy some commodities below their real values and sell them at or above their real values and in this way appropriate a surplus value through unequal exchange. But whatever these agents gain in surplus value, some other agents must lose, because of the conservation of value in exchange.

Producers add value to commodities by expending labor on them, but in general they receive in exchange no more than the equivalent of this labor time. Thus there appears to be no way to explain the pervasive appropriation of surplus value as the basis of economic life within this conception.

Notice also that the only conception of accumulation of value in such a system is for an agent to realize more value by selling commodities than he spends in buying them over a period. The difference must take the form of an accumulation of money by the agent. But this accumulated value is simply withdrawn from commodity circulation through the agent's abstinence from consumption.

When the agent finally spends the hoard he has accumulated, he simply returns the money value to circulation and withdraws commodities from circulation of the same value (assuming that the value of money has not changed in the  meantime). There is in this conception no systematic process of accumulation."

2b. Capitalism

Capitalism is a weird mode of production, its strangeness hidden by its historical and geographical ubiquity, as Michael Heinrich explains in his “An Introduction to the Three Volumes of Karl Marx’s Capital” (p. 17):

Amazon link

"In precapitalist societies, the exploitation of the dominated class served primarily the consumption of the ruling class: its members led a luxurious life, used appropriated wealth for their own edification or for that of the public (theater performances in ancient Greece, games in ancient Rome) or to wage war.

Production directly served the fulfillment of wants: the fulfillment of the (forcibly) restricted needs of the dominated class and the extensive luxury and war needs of the ruling class. Only in exceptional cases was the wealth expropriated by the ruling class used to enlarge the basis of exploitation, such as when consumption was set aside to purchase more slaves, to produce a greater amount of wealth.

But under capitalist relations, production for the sake of increasing the capacity to produce is typically the case. The gains of a capitalist enterprise do not serve in the first instance to make a comfortable life for the capitalist possible, but are rather invested anew, in order to generate more gains in the future. Not the satisfaction of wants, but the valorization of capital is the immediate goal of production; the fulfillment of wants and therefore a comfortable life for the capitalist is merely a by product of this process, but not its goal. If the gains are large enough, then a small portion is sufficient to finance the luxurious existence of the capitalist, and the greater portion can be used for the accumulation (enlargement) of capital.

The fact that earnings do not primarily serve the consumption of the capitalist, but rather the continuous valorization of capital, that is, the restless movement of more-and-more accumulation, might sound absurd.

But the issue at hand is not an individual act of insanity. Individual capitalists are forced into this movement of restless profiteering (constant accumulation, expansion of production, the introduction of new technology, etc.) by competition with other capitalists: if accumulation is not carried on, if the apparatus of production is not constantly modernized, then one’s own enterprise is faced with the threat of being steamrolled by competitors who produce more cheaply or who manufacture better products.

A capitalist who attempts to withdraw from this process of constant accumulation and innovation is threatened with bankruptcy. He is therefore forced to participate, whether or not he wants to."

2c. Bureaucratic Socialism

Sam Williams describes the following scenario:

"A single corporation emerges that controls all of production. Let’s call our imaginary corporation the Universal Company Inc.  Its stock is traded on Wall Street and other global stock exchanges. Indeed, it is the only stock traded on the world’s stock exchanges, because it is the only corporation. It is the only business in the world.

Every factory, mill, mine, farm is controlled by Universal’s board of directors. Managers and technical personnel hired by its board of directors determine exactly what kind of goods are produced and the proportions in which each type of good is produced. Under the rule of Universal Company Inc., all workers are employees of the company since there are simply no other corporations to work for. Under the rule of Universal, what is the highest authority that the individual workers face? Why it’s the board of directors of Universal, which is elected by the stockholders of Universal on the principle of one share one vote.

But do the products of the labor of the workers of Universal take the form of commodities? The answer is no. Why not? Remember, Marx defined commodity production as a situation where the producers work for their own private accounts. Producers of commodities exchange the products of their labor and face no higher authority than the mutual pressure they exert on one another. Or what comes to exactly the same thing, the highest authority the producers face is competition among themselves. But this is not the case with the workers of Universal.

Instead of being indirectly social, the labor of the workers of Universal is directly social, as would also be the case under the rule of the associated producers. The board of directors and its subordinate employees such as managers, computer experts, foremen and so on see to it that the workers produce the right products in the right proportions. Since there is no commodity production, there is also no money, since money is simply a form of the commodity. And for the same reason, there is no capital, since capital consists of commodities and money. Where there is no commodities and money, there is no capital. And where there is no capital, there is no accumulation of capital.

The board of directors of the Universal Company Inc. might choose to continue expanded reproduction, but if it does, it will be accumulating use values not capital.

Since I am assuming a class of stockholders, the workers of Universal are indeed exploited. They are forced—just like is the case at the present day—to work some of the time for the boss—the stockholders of Universal—and some of the time for themselves. This allows the stockholders of Universal to live without working.

But the surplus product produced by the surplus, or unpaid, labor of the workers cannot take the form of surplus value, because there is no commodity production and labor does not take the form of value. And where there is no value, there can be no surplus value. And where there is no surplus value, there is no commodity production and no money. The surplus labor of the workers cannot take the form of profit—surplus value realized in the form of money. And where there is no surplus value and no capital, there is no capitalist mode of production.

While some might want to call our imaginary system of exploitation run by the Universal Company “state capitalism” in order to underline its exploitative nature as opposed to the system of cooperative production carried out by the associated producers, they would be forgetting that there have been other systems of exploitation in the history of human production over the last ten thousand years besides capitalism. But our imaginary system would not be a form of capitalism whatever else it might be, because it would lack the essential characteristics that separate capitalist production from other forms of exploitation.

For example, there would be no crises of the general overproduction of commodities, if only because there is no commodity production. In principle, our imaginary system might experience a generalized overproduction of use values, but that is something very different than the crises we experience under capitalism, which combine a generalized overproduction of commodities with a generalized underproduction of use values."

What Sam Williams describes here is an economic description of the "Communist States" emerging from the Russian Revolution and its WW2 aftermath. If you replace bureaucratic domination by workers control, you have a Trotskyist model for the aftermath of a socialist revolution: democratic socialism as the precursor (as the productive forces are developed) of communism. I have critiqued that model elsewhere.

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3. Discussion

To read further on why total automation is incompatible with capitalism, please continue to:

"They dismiss the last workers from their fully automated factories".