Critical Education Articles Placed in the Staff Lounge While I Was a Teacher, Part Nine: A Feminist Logic?

This is a continuation of earlier posts.

When I was a French teacher at Ashern Central School, in Ashern, Manitoba, Canada, I started to place critiques, mainly (although not entirely) of the current school system. At first, I merely printed off the articles, but then I started to provide a summary of the article along with the article. I placed the summaries along with the articles in a binder (and, eventually, binders), and I placed the binder in the staff lounge.

As chair of the Equity and Justice Committee for Lakeshore Teachers’ Association of the Manitoba Teachers’ Society (MTS), I also sent the articles and summary to the Ning of the MTS (a ning is “an online platform for people and organizations to create custom social networks”).

As I pointed out in a previous post, it is necessary for the radical left to use every opportunity to question the legitimacy of existing institutions.

The following is what I wrote to either the Ning or to the executive of Lakeshore Teachers’ Association or both (I cannot remember now):

I could not send the attached article to the ESJ Ning because the file size is greater than 3 MB and the Ning allows a maximum of 3MB.

I still did send the following summary and commentary, though:

The author (Caroll Hart)  of the following article, “Power in the Service of Love,” argues that Dewey’s work, Logic: The Theory of Inquiry, provides a basis for the development of a logic that addresses feminist concerns for a theory that incorporates contextual experiences into the fabric of logic (including the specific contextual experiences of women). Women’s experiences are not the same as those of men, but at the same time there are commonalities, she implies, so logic should be capable of developing a universal logic that incorporates difference within itself. Dewey’s logic attempts to do just that.

Traditional logic is primarily a male preserve that claims to be universally valid and that excludes a large part of experiences by women. Traditional logic excludes a large part of the chaotic and ambiguous nature of ordinary life and language. On the other hand, traditional logic does seem to have some validity—there is no rational ground for rejecting traditional logic in favour of no logic at all. The problem, then, is to develop a logic that incorporates some aspects of traditional logic but at the same time goes beyond such logic.

Carroll Hart argues that John Dewey’s theory of logic satisfies those conditions and that feminists would do well to incorporate Dewey’s theory into their own ways of thinking and practice.

Logic, for Dewey, is a means to an end and not an end in itself, when viewed from the point of view of ordinary experiences of human beings in their daily lives. Logic is a tool, serving human ends rather than some universal end to which human beings must submit necessarily. We use logic to improve our lives and performances in our lives, and it is our lives and our performance in our lives that logic must serve. Logic is an instrument or tool, and we are the master of that instrument or tool. Logic serves us; we do not serve logic. Logic is, as the title of the article suggests, in the service of love—for our own lives and for our environments.

A logic that serves us permits us to become more sensitive to the environment or context within which we act.

Logic in its traditional sense is ordering or organization in a systematic fashion; in a sense, it is the organization of organization, or systematic systematization. However, the nature of this systematization is in dispute. Is it a systematization of the actual order or structure of the natural world? Is it a systematization of our language?

In experimental science, logic serves a functional status as a means to economize on effort by applying logical rules to derive conclusions that can be experimentally more relevant. Logic in this context is a means for us to regulate or control our experience and not something separate from us or from a specific function. Typically, though, logic is separated from its function and becomes an entity unto itself, with the consequent degradation of human experience.

Logic and intellectualization are inherently about constant relations and connections, but the reduction of the world of human experience to pure, unchanging relations and connections ignores the nature of experience as variable and subject to change. The establishment of constant relations through logic and the intellect is a means of controlling the variable nature of experience and not of ignoring that variability.

Viewing the world in purely logical and intellectual terms (typical of schools) excludes a large part of human experience and denigrates that experience while elevating logical and intellectual experience to a superior realm above ordinary human experience. Logical and intellectual relations are important, but they are important as means for guiding and enriching ordinary human experience—not dominated and denigrating it.

Indeed, the need for logic and intellectualization emerges from the ecology of the body/mind, with a situation within that ecology leading to the need for inquiry and thus for logic and intellectualization. Logic and intellectualization also leads to that ecology by contributing to the resolution of the problem that gave rise to the need for logic and intellectualization in the first place. Learning (inquiry) exists, ultimately, for the sake of ordinary experience and not vice versa.

In a situation in ordinary experience in which a problem emerges, there are conflicting aims or ends that cannot be immediately realized. Common-sense inquiry typically emerges as a result in order to address the problematic situation. People make inferences of the consequences of acting in a certain way when certain conditions are present and judgement about the nature of the problematic situation and about what is to be done in face of such a situation.

Logical forms arise to ensure that inference and judgement are controlled rather than haphazard. Logic enables us to check our inferences and judgements against previous rules culled from past experience.

There are two general logical forms, one involving definitions (decomposable into “if-then” sentences), and the other involving actual conditions in the world. Logical forms that are definitions may be too abstract to assist in the process of inquiry, but they may be broken down into more specific and interrelated characters useful to guide inquiry. Logical definitions involve each character forming a necessary component of the total logical term. (A triangle, for example, as a logical term, must have three interior angles that add up to 180 degrees. If something is a triangle, then it must have three interior angles that add up to 180 degrees.)

The other logical form has to do with inference and the determination of the specific nature of kinds involved in a problematic situation. The determination of the various kinds involved in a situation and the kind of situation itself requires inquiry and is controlled by the logical form of definitions .

Definitions and kinds are not isolated but form part of a system of interrelated cultural meanings. Interrelated definitions permit extensive logical implication and refinement; interrelated kinds permit extensive logical inference.

Interrelated definitions and kinds, if not situated in their function as means of controlling our inquiries in the face of problematic situations as we live our lives, assume an independent form that seems to be valuable in themselves—independently of human beings. However, such autonomization of logical forms typical of the conventional view of logical and intellectual terms leads to meaningless terms since such forms have meaning only in relation to their function of aiding in guiding and controlling inquiry in the face of a problematic situation.

Logical and intellectual forms thus must be connected to the world of ordinary experience, which involves the body and not just “pure reason.” Logical forms must involve a unity of the existential and the ideal. Both, in turn, must involve the inquiry process in the context of a problematic situation arising from ordinary experience.

To reduce the world of ordinary experience to the world of logical forms is to strip our multifaceted experiences to a one-dimensional world characteristic of academics—who have mainly been male. Such a world undoubtedly has its elegance, but to take it as the whole of human experience is to confuse the part for the whole and to sacrifice the whole for the part. It is to strip the richness of human experience of its qualities and to sacrifice that richness for the sleek elegance of logical forms.

It has been male academics who have traditionally claimed such logical forms to be universally applicable regardless of differences in human experiences. Dewey, though male and an academic, recognized that such universality was a chimera. The logical forms are means for the end of enrichment of the human community and not some universal end to which we must all conform. We use logical forms when faced with a problematic situation, and those logical forms assume a universal form but always emerge from and return to differential situations with all their “chaos and messiness.”

The logical forms enable us to grasp commonalities among situations, but differences among situations lead to a refining of the logical forms as well as branches that constitute different commonalities over time.

One of the problems which the Hart does not face is whether differences may take precedence over commonalities. Although of us live on this Earth and therefore share a common situation to that extent, differences may indeed lead to irreconcilable conflicts.

The educational implications of this view of logic and intellect should be obvious. These educational implications are opposed to the modern school system, which makes intellect the end of everything. The experiences of students that do not have the intellect as their focus are considered irrelevant. Learning, and only learning, is important. Although Dewey’s logic appreciates the importance and role of learning, the intellect and logic in human life—indeed, Dewey wrote his book Logic: The Theory of Inquiry, in part, to emphasize the importance of inquiry and hence learning in the life process—it is still an end to other means for most people. To take the means (learning) for the end (improvement of human life), and to take the end as the means (human life is to be sacrificed for the sake of learning) is to pervert human nature and to assume an academic and elitist attitude towards human experience.

Schools need to treat the development of the intellect in functional terms, as means toward an end and not ends in themselves. The development of the intellect may indeed become a temporary end as students learn to appreciate the importance of intellectual development for the improvement of human life, but it should never be forgotten that the focus on the development of the intellect is a temporary perch before the child flies towards other goals that are most often more important than so-called learning goals for the students.

There is a limitation to Hart’s article. Hart recognizes that she is from the middle class, but her difference from the working class may blind her to their distinct differences. For example, the middle class often denies the importance of the power of employers in influencing workers’ behaviour. Often, they cannot even face the situation that workers (whether male or female) become employees who are converted into things to be used by employers. Their personhood is denied when they are working; it is only recognized in the sale. Loss of civil rights as an employee is rarely something that the middle class can face critically. They seek to avoid engaging in debate over the issue since such debate may oblige them to rethink their lives and change the direction of their lives, and they have little desire to change the direction of their lives.

Dewey’s logic has therefore much to recommend itself to feminists, but those feminists who are of the middle class, if they do indeed wish to recognize difference within commonality, must make a sustained effort to recognize the limitations of their own experiences. Working-class women are both women and members of the working class—subject to the power not only of males but of employers. Educators, too, must come to recognize the importance of that power and incorporate such recognition in their own practices—together, in solidarity with each other and with other employees subject to the power of employers.

A working-class feminist logic may indeed appreciate and incorporate Dewey’s theory of logic into its own theory, but it must be supplemented by a logic that incorporates differences that may indeed be irreconcilable—such as the differences between employers and employees.

Educators would well incorporate Dewey’s logic into their own work and supplement it with a logic that recognizes irreconcilable differences. Equity and social justice demands such recognition.

A Short List of the Largest Employers Based in Calgary, Alberta, Canada, Based on the Number of Employees

When belonging to a leftist organization called the Toronto Labour Committee (Ontario, Canada), I worked on, in a minor position, on some statistics related to financial campaign contributions for the Toronto elections. Not being satisfied with this, I proposed that we start trying to develop a class analysis of Toronto. I indicated, though, that I did not really know how to proceed in this. I sent this over the Toronto Labour Committee listserve, and the response was–silence.

The following attempts to fill in, however inadequately, that silence, this time in relation to Calgary.

I thought it would be useful to provide a list of some of the largest employers in Canada. The reason why I think such a list would be useful is that it provides at least a somewhat concrete picture of who really has power in society and the extent of that power. Since most social-reformist leftists ignore the power of employers and assume such power as a background which they can assume as constant, they then consider their reformist policies without calling into question such power.

The following provides a list of the 20 largest employers with headquarters based in Calgary. This list is based on the number of employees. As I pointed out in another post, such lists can vary, depending on the criteria used (such as profit, the number of employees or assets).

It should be pointed out that the following does not refer to the number of employees employed in Calgary. Rather, it refers to the number of employees of the particular capitalist employer in question; it probably includes the number of employees in Calgary, in the rest of Canada and, perhaps, outside of Canada.

It is taken from Top Calgary-Based Employers Based on the Number of Employees.

Company                                                                     Number of Employees

  1. Canada Pacific Railway Inc.                          12,770
  2. Suncor Energy Inc.                                       12,080
  3. Enbridge Inc.                                                12,000
  4. WestJet Airlines Ltd.                                     11,624
  5. Shaw Communications Inc.                          10,000
  6. Canadian National Resources Ltd.                 9,709
  7. Ensign Energy Services Inc.                            7,160
  8. TransCanada Corp.                                         7,081
  9. ATCO Ltd.                                                        6,241
  10. Imperial Oil Ltd.                                              5,700
  11. Precision Drilling Corp.                                   5,471
  12. Husky Energy Inc.                                            5,157
  13. MNP LLP                                                          4,808
  14. Calfrac Well Services Ltd.                                 3,900
  15. Calgary Co-Operative Association Ltd.            3,800
  16. Parkland Fuel Corp.                                          3,051
  17. Stuart Olson Inc.                                               2,924
  18. NOVA Chemicals Corp.                                     2,900
  19. AltaGas Ltd.                                                       2,881
  20. Total Energy Services Inc.                                  2,314

Total Number of Employees                              131,571 

The social-democratic left have little to say about this situation. Probably, as long as these workers are unionized and have a collective agreement, then they have a “fair contract” and have “decent work.”

It is even difficult to say what they mean by “fair contract” and “decent work.” If the workers are not unionized but obtain a relatively higher wage or salary and benefits, is that then “decent work” and a “fair contract?”

What of the freedom of the workers? Do they really control their lives regardless of whether they are unionized or not? Twenty employers controlling over 130,000 people (with over 6500 workers per employer).  Do you find that an expression of freedom? Of democracy? Or should we call it–a dictatorship?

Do those who invest in such companies in more than a small scale (such as some workers do) have to work? Or can they live off the work of such workers through appropriating the profits that these workers produce?

The Rate of Exploitation of Workers at ScotiaBank (Bank of Nova Scotia)

Introduction

In two others posts I presented the twenty largest employers in Toronto according to level of employment (see A Short List of the Largest Employers in Toronto, Ontario, Canada) and the twenty largest employers in Canada according to profit (see A Short List of the Largest Private Employers in Canada, According to Profit). The largest employer, in terms of employment, is the Canadian Imperial Bank of Commerce.

I have tried to calculate the rate of exploitation of workers of Magna International in an earlier post (see The Rate of Exploitation of Workers at Magna International Inc., One of the Largest Private Employers in Toronto, Part One); Magna International is one of the largest employers in Toronto.

The Nature of the Rate of Exploitation

But what is the rate of exploitation? And why not use the usual rate of profit or the rate of return? The rate of profit is calculated as profit divided by investment. Since employers purchase both the means for work–buildings, computers, office supplies, raw material–and hire workers–we can classify investment into two categories: c, meaning constant capital, or the capital invested in commodities other than workers; and v, or variable capital, the capital invested in the hiring of workers for a certain period of time (wages, salaries and benefits).

The purpose of investment in a capitalist economy is to obtain more money (see The Money Circuit of Capital), and the additional money is surplus value when it is related to its source: workers working for more time than what they cost to produce themselves. The relation between surplus value and variable capital (or wages and salaries) is the rate of surplus value or the rate of exploitation, expressed as a ratio: s/v.

When the surplus is related to both c and v and expressed as a ratio, it is the rate of profit: s/(c+v).

In Marxian economics, you cannot simply use the economic classifications provided by employers and governments since such classifications often hide the nature of the social world in which we live. The rate of profit underestimates the rate of exploitation since the surplus value is related to total investment and not just to the workers. Furthermore, it makes the surplus value appear to derive from both constant capital and variable capital.

I decided to look at the annual report of some of the largest private companies in Toronto and Canada if they are available in order to calculate the rate of exploitation at a more micro level than aggregate rates of surplus value at the national or international level. Politically, this is necessary since social democrats here in Toronto (and undoubtedly elsewhere) vaguely may refer to exploitation–while simultaneously and contradictorily referring to “decent work” and “fair contracts.” Calculating even approximately the rate of exploitation at a more micro level thus has political relevance.

Conclusions First

As usual, I start with the conclusion in order to make readily accessible the results of the calculations for those who are more interested in the results than in how to obtain them.

We have the following:

Adjusted Income before income taxes $11,724=s
Adjusted Total salaries and total benefits $7,989=v

The rate of exploitation or the rate of surplus value is s/v; therefore, s/v is 11,724/7,989=147 percent.

This means that, in terms of money, $1 of wage or salary of a regular bank worker results in $1.47 Canadian dollars surplus value or profit for free. Alternatively, for every hour worked, a Scotiabank worker works 88 minutes (or 1 hour 28 minutes) for Scotiabank for free.

I will calculate the rate of exploitation or the rate of surplus value for each approximate variation of the length of the working day (a more detailed explanation of how to calculate the rate of exploitation is provided in the post  The Rate of Exploitation of the Workers of the Canadian Imperial Bank of Commerce (CIBC), One of the Largest Private Employers in Toronto and in Canada).

  1. 7-hour work day: Scotiabank workers spend  170 minutes (2 hours 50 minutes)  to obtain their wage for the day, and they spend 250 minutes (4 hours 10 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  2. 7.5-hour work day: Scotiabank workers spend 182 minutes (3 hours 2 minutes) to obtain their wage for the day, and they spend 268 minutes (4 hours 28 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  3. 8-hour work day: Scotiabank workers spend 194 minutes (3 hours 14 minutes) to obtain their wage for the day, and they spend 286 minutes (4 hours 46 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  4. 9-hour work day: Scotiabank workers spend 219 minutes (3 hours 39 minutes) to obtain their wage for the day, and they spend 321 minutes (5 hours 21 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  5. 9.5 hour work day (to cover a 47.5 hour work week spread out in five days): Scotiabank workers spend 231 minutes (3 hours 51 minutes0 to obtain their wage for the day, and they spend 339 minutes (5 hours 39 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  6. 12-hour work day: Scotiabank workers spend 291 minutes (4 hours 51 minutes) to obtain their wage for the day, and they spend 429 minutes (7 hours 9 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  7. 15-hour work day: Scotiabank workers spend 364 minutes (6 hours 4 minutes) to obtain their wage for the day, and they spend 536 minutes (8 hours 56 minutes( in obtaining a surplus value or profit for free for Scotiabank.

Scotiabank workers do not belong to a union. Would their becoming unionized turn their situation into one where they had a “fair contract” and “decent work?” I think not. Unions can limit exploitation and can control some aspects of their working lives, but in principle workers are things to be used by employers even with unions. This does not mean that a non-unionized environment is the same as a unionized environment. With unions that are independent of particular employers, that is to say, are real unions, there is an opportunity for workers to develop organizations of resistance against the power of particular employers.

The ideology of unions–that somehow they can produce a “fair contract” and “decent work”–needs, though, to be constantly criticized. Workers deserve better than the acceptance of such ideology by the left.

Data on Which the Calculation Is Based

Now, the calculation:

In millions of Canadian dollars:

2019

Revenue

Interest income

Loans $ 29,116
Securities 2,238
Securities purchased under resale agreements and securities borrowed 502
Deposits with financial institutions 928

Total interest income: 32,784

Expenses

Interest expense

Deposits $13,871
Subordinated debentures  294
Other 1,442

Total interest expense: 15,607

Net interest income 17,177

Non–interest income 

Card revenues 977
Banking services fees 1,812
Credit fees 1,316
Mutual funds 1,849
Brokerage fees 876
Investment management and trust 1,050
Underwriting and other advisory 497
Non-trading foreign exchange 667
Trading revenues 1,488
Net gain on sale of investment securities  351
Net income from investments in associated corporations 650
Insurance underwriting income, net of claims 676
Other fees and commissions 949
Other 699

Total non-interest income: 13,857
Total revenue 31,034

Provision for credit losses 3,027
[Net Revenue]: 28,007

Non-interest expenses

Salaries and employee benefits 8,443
Premises and technology 2,807
Depreciation and amortization 1,053
Communications 459
Advertising and business development 625
Professional 861
Business and capital taxes 515
Other 1,974

Total non-interest expenses: 16,737

Income before taxes 11,270

Adjustments

In Marxian theory, it is necessary to question whether some expenses are expenses for both the individual employer and for the class of employers (and fractions of their class, such as those who live on interest); in such a case, the expense is deducted from total revenue. On the other hand, there are expenses that are expenses for the individual employer but are not expenses when looked at from the point of view of the class of employers; in such an instance, they are paid out from the surplus value produced or obtained by workers and are to be included in income before taxes.

In the category “Salaries and employee benefits,” there are the subcategories “Performance-based compensation” and “Share-based payments.”

Salaries and employee benefits
Salaries $ 4,939
Performance-based compensation 1,761
Share-based payments 278
Other employee benefits 1,465
$ 8,443

There is a table titled “Compensation of key management personnel” in the annual report that is relevant. This category covers the following employees:

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Bank, directly or indirectly, and comprise the directors of the Bank, the President and Chief Executive Officer, certain direct reports of the President and
Chief Executive Officer and Group Heads.

The table is as follows:

Compensation of the Bank key management personnel

For the year ended October 31 ($ millions) 2019
Salaries and cash incentives  $17
Equity-based payment  $25
Pension and other benefits 5
Total $47

It should be noted that this table refers only to the end of October 31 as does all the information above since the fiscal year for Scotiabank ends on October 31.

This more detailed information does not influence my decision to include the whole category of “Share-based payments” to the category of surplus value rather than to “Salaries.”  The CEO of Scotiabank, Brain Porter, plus five other senior executives, received a total compensation of over $29 million. It is likely that “Share-based payments” are allocated according to the level of pressure on subordinates to perform (including organizational  and policy decisions to ensure such pressure is effective); such payments likely are received by senior and middle (and, perhaps, lower management) based on performance targets that they either set or force subordinates to achieve.

This situation is somewhat similar to the calculations I made for the Royal Bank of Canada workers.

This means that “Salaries and benefits” is reduced by $278 million and the category “Income before income taxes” is increased by $278 million.

I also assume that 10 percent of the amount of the category “Performance-based compensation” is actually surplus value and not salaries that are due to actual work. In other words, some of “performance-based compensation” is due to management obliging workers to work at a certain level (and some of it is due to the workers themselves working at a certain level of intensity in order to receive some form of performance compensation).

My logic is the same as my calculation in some other banks (such as the CIBC), where I wrote:

However, the gap between executive pay and the pay of regular employees has widened over the years, so it is reasonable to infer that the category “Performance-based compensation” is divided into two parts: one part is a function of the number of hours worked by regular employees as well as the intensity of that work; the other is based on the extent to which bank managers and senior executives are successful in exploiting those regular employees. …

it is probably reasonable to assume that a minimum of 10 percent of the “Performance-based compensation” comes from the exploitation of senior bank executives of regular workers.
It would be necessary to have more detailed information to determine whether more or less of the money obtained in this category were distributed between regular bank workers and management executives. If regular bank workers received more, then the rate of exploitation would be less than the rate calculated below. If management executives received more, then the rate of exploitation would be more than the rate calculated below.

On the assumption of 10 percent, though, this means that 10 percent of the total of “Performance-based compensation, ” is reduced by 10 percent.

It also means that this 10 percent ($176 million) is allocated to the category “Income before taxes.”

Adjusted Results

Adjusted Income before income taxes $11,724=s
Adjusted Total salaries and total benefits $7,989=v

The Rate of Exploitation of Scotiabank Workers

The rate of exploitation or the rate of surplus value is s/v; therefore, s/v is 11,724/7,989=147 percent.

This means that, in terms of money, $1 of wage or salary of a regular bank worker results in $1.47 Canadian dollars surplus value or profit for free. Alternatively, for every hour worked, a Scotiabank worker works 88 minutes (or 1 hour 28 minutes) for Scotiabank for free.

The length of the working day varies. To the question: “On average, how many hours do you work a day at Scotiabank?,” the answers were:

  1. 8 to 9 hrs per day.
  2. 8 hours and 30 mins
  3. 8 hours a day from Monday to Friday with 1 hour for lunch
  4. 48 hours a week
  5. 9 Am to 6 pm
  6. Depends on department , some are typical 8:30-5 while others such require much longer hours,up to 12-15 hours per day
  7. 37.5 hrs per week

I will calculate the rate of exploitation or the rate of surplus value for each approximate variation of the length of the working day (a more detailed explanation of how to calculate the rate of exploitation is provided in the post The Rate of Exploitation of the Workers of the Canadian Imperial Bank of Commerce (CIBC), One of the Largest Private Employers in Toronto and in Canada).

  1. 7-hour work day: Scotiabank workers spend  170 minutes (2 hours 50 minutes)  to obtain their wage for the day, and they spend 250 minutes (4 hours 10 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  2. 7.5-hour work day: Scotiabank workers spend 182 minutes (3 hours 2 minutes) to obtain their wage for the day, and they spend 268 minutes (4 hours 28 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  3. 8-hour work day: Scotiabank workers spend 194 minutes (3 hours 14 minutes) to obtain their wage for the day, and they spend 286 minutes (4 hours 46 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  4. 9-hour work day: Scotiabank workers spend 219 minutes (3 hours 39 minutes) to obtain their wage for the day, and they spend 321 minutes (5 hours 21 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  5. 9.5 hour work day (to cover a 47.5 hour work week spread out in five days): Scotiabank workers spend 231 minutes (3 hours 51 minutes0 to obtain their wage for the day, and they spend 339 minutes (5 hours 39 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  6. 12-hour work day: Scotiabank workers spend 291 minutes (4 hours 51 minutes) to obtain their wage for the day, and they spend 429 minutes (7 hours 9 minutes) in obtaining a surplus value or profit for free for Scotiabank.
  7. 15-hour work day: Scotiabank workers spend 364 minutes (6 hours 4 minutes) to obtain their wage for the day, and they spend 536 minutes (8 hours 56 minutes( in obtaining a surplus value or profit for free for Scotiabank.

It should be noted that I have used the verb “obtain” rather than “produce.” In Marxian economics, bank workers, as well as sales workers do not produce surplus value but rather transfer the surplus value already produced. This does not mean that these workers are not exploited capitalistically; they are used impersonally by the employer to obtain surplus value and a profit. Furthermore, things produced by others are used by employers such as Scotiabank to control their working lives in order to obtain surplus value or profit.

Scotiabank workers do not belong to a union. Would their becoming unionized turn their situation into one where they had a “fair contract” and “decent work?” I think not. Unions can limit exploitation and can control some aspects of their working lives, but in principle workers are things to be used by employers even with unions. This does not mean that a non-unionized environment is the same as a unionized environment. With unions that are independent of particular employers, that is to say, are real unions, there is an opportunity for workers to develop organizations of resistance against the power of particular employers.

The ideology of unions–that somehow they can produce a “fair contract” and “decent work”–needs, though, to be constantly criticized. Workers deserve better than the acceptance of such ideology by the left.

The Real World of the Rule of Law: Courts as Oppressive Organizations, Part Two: The Case, Not the Truth, is Relevant in Court Proceedings

Introduction

This is a continuation of a previous post (The Real World of the Rule of Law: Courts as Oppressive Organizations, Part One). I explored how judges influence what juries define as “reasonable doubt.” As I indicated in the previous post:

The following series of posts are meant to complement the series of posts on the issue of reforming versus abolishing the police (see for example Reform or Abolition of the Police, Part One or Reform Versus Abolition of the Police, Part 8: The Police and the Political Economy of Capitalism).

The following is mainly a series of quotes from the book by Doreen McBarnet (1983) Conviction: Law, the State and the Construction of Justice as well as short commentaries related to the quotes. I use her book as a way of exposing the real nature of the rule of law and the role of courts in both hiding the real nature and enforcing the real nature of the rule of law.

A note on the limitations of the following: Ms. McBarnet draws on English and Scottish law; the situation here in Canada may be somewhat different. If anyone knows of sources relevant for determining the real operationalization of the rule of law in Canada, please provide them in the comments section.

The social-democratic left here in Toronto have little to say about the role of courts in general in oppressing members of the working class, citizens, immigrants and migrants. There are of course particular criticisms of court decisions, but there is no critique of the systemic oppression of the courts.

The Ideology of Telling the Truth Versus Legal Proof and the Construction of a Case

The common-sense view of courts is that a person is presumed innocent until proven guilty. In the previous post, it was shown that the judge influences what is sufficient evidence to convict. 

Another piece of ideology or rhetoric is that witnesses, when they testify, are to provide only the truth and nothing more nor less. From page 12: 

Witnesses are simply enjoined to ‘tell the truth, the whole truth and nothing but the truth’, a fine
piece of rhetoric, devastatingly naïve and blase, but also extremely powerful. …  Indeed when one adds the fact that most trials take place months if not years after the incident in question, and that the court in an adversary system is presented with two conflicting versions of that incident, it becomes incredible that any jury or magistrate can ever feel that what happened has been proved beyond question. Yet in the vast majority of trials it seems they are. The philosophical problem of how one reproduces ‘reality’ thus becomes a sociological one: how is it that in such a situation of ambiguity, conflict, subjectivity, fading or moulded memories, the judges of the facts can so readily find themselves convinced beyond reasonable doubt?

Truth is hardly an issue in courts–despite rhetoric to the contrary. What actually happens (the truth or the incident) and what is presented in court usually diverge substantially. 

It is from a legal point of view and not from the point of view of common sense that is important in trials: From pages 16-17:

Adversary advocacy helps solve the philosophical problem of reproducing reality quite simply by not even attempting it. Instead the search for truth is replaced by a contest between caricatures. Advocacy is not by definition about ‘truth’ or ‘reality’ or a quest for them, but about arguing a case. The concept of a case is such a fundamental part of Western legal thought that we may take it for granted, but it is a method of proof with a history of only two or three centuries, and one which provides a neat example of the abstraction which theorists oflaw under capitalism, like Pashukanis (1978), see as an essential element of the legal form. Just as the concept of the legal subject abstracts him from his real social being, so the case abstracts from the complexity of experience, and in doing so it helps solve both the practical and the ideological problems of proof.

The “case” as opposed to the truth is the central aspect of civil and criminal trials. From page 17:

An incident and a case made out about the incident are not the same thing. Conceptions of reality are multifaceted and unbounded; cases are ‘the facts’ as abstracted from this broad amorphous raw material. The good advocate grasps at complex confused reality and constructs a simple clear-cut account of it. A case is thus very much an edited version. But it is not just edited into a minimal account-a microcosm of the incident-it is an account edited with vested interests in mind. Hence the lawyer’s approach ‘that, so far as possible, only that should be revealed which supports his case’ (Napley, 1975, p. 29). Far from being ‘the truth, the whole truth and nothing but the truth’ a case is a biased construct, manipulating and editing the raw material of the witnesses’ perceptions of an incident into not so much an exhaustively accurate version of what happened as one which is advantageous to one side. In relation to an incident, then, a case is partial in both senses-partisan and incomplete. The good advocate is not concerned with reproducing incidents but producing cases, not with truth but with persuasion.

The editing of an incident arises through the twin legal aspects of proof: relevance and admissibility. From page 15: 

 … the problem of ‘unbounded reality’ is tackled by the notions of admissibility and relevance.

This situation applies as much to the prosecution as it does to the defense in the case of criminal charges. Despite the rhetoric of the prosecutor being “an impartial minister of justice” (page 19), the prosecutor systematically engages in the construction of a case (rather than determining the truth of an incident) in order to obtain a conviction. Pages 19-20:

… the prosecutor has a duty to give to the defence the names of witnesses whom he does not intend to call but who do have material evidence to offer (Archbold, I979, s. 433). The word ‘material’ is the
key. It indicates that the prosecutor is assumed to present a case selected for conviction rather than one that sets out all of even what he sees as the material facts. Again, the prescription for how and to
what end examination-in-chief should be conducted-‘to adduce relevant and admissible evidence to support the contention of the party who calls the witness’-makes no exception for the prosecuting
counsel (ibid., s. 512).

At the level of practice there is no doubt that prosecutors do act out the normal advocate’s role of arguing a one-sided case:

Presenting prosecutors as representatives of justice rather than as biased individuals who construct a biased case to obtain a conviction is ideological and serves to distort the real nature of legal systems (page 21):

… the notion of the prosecutor as a ‘minister of justice’ not only functions at the ideological level both in the rhetoric of the Bar as to their role, and in general to support the view of a system of justice bending over backwards to ensure the innocent are not convicted, but is also an idea that is put to good practical use by prosecutors in court to support the credibility of their cases as
opposed to the biased nature of the defence’s:

Prosecutor: Ladies and gentlemen, my function is to elicit as much evidence as possible to put before you. My friend’s is to defend his client’s best interests. I act in the public interest. (Case 103)

Representing the prosecutor as the “public’s interest” is hardly itself the truth of the situation; the prosecutor constructs a case just as much as does the defense lawyer. Consequently, the reference to “public interest” serves to hide the truth of the situation. Truth is hardly the central focus of the legal system (but, of course, if you are found lying within the legal system, you may suffer legal repercussions–despite the irrelevance of the truth often enough in legal proceedings). Page 20:

the examples throughout this book are readily supported officially by the Fisher Report on the Confait case, in which three youths-two of whom were mentally subnormal-were convicted of murder on the basis of impossible confessions-impossible, because it was subsequently proved that Confait could not possibly have died as late as the confessions alleged. But ambiguities over the time of death were
filtered out by the police and prosecution in constructing and presenting their case. Fisher (I977) notes at the prosecutor’s courtroom examination of a pathologist on the crucial issue of the time of death:

It might well be that, if Dr C. had been given sight of the other evidence and asked to reconsider his evidence in the light of it, and had been asked the relevant questions in a neutral way instead of being asked to suggest ways in which the period for the time of death could be extended after midnight, the course of the trial would have been different and an acquittal might have resulted. (Fisher, I977, p. 223)

Or again:

… far from trying to make the time of death more precise, those concerned with the investigation and prosecution … made every effort to keep it as vague as possible. The reason for this was that they were concerned to establish a case which rested wholly or mainly on confessions which could not be entirely true unless the time of death was outside the brackets given by [the experts). (Ibid., p. 20)

Of course, most social democrats and social reformers will simply ignore this situation. They either ignore legal oppression altogether, or make vague assertions about “transforming the system” into “a more humane form” (see the first post in this series about such a claim by the social democrat Herman Rosenfeld here in Toronto). Social democrats, rather, rely on such vague phrases as the “rule of law” or “democratizing the law” and similar clichés to justify their reformist views (and, indeed, their lack of practical engagement in trying to change the economic, political and social structure).

But let us continue. The construction of a case rather than determining the truth limits the function of witnesses to respondents to lawyers’ questions (which are, of course, designed to elicit responses to favour their specific construction or version of the case). From page 22:

A further feature of the form of presenting proof is that it is interrogatory. Evidence is not presented directly by witnesses, but indirectly in response to questions by counsel. The rules prohibit leading questions but the very framing of a question, whether leading or not, and the context in which it occurs, set parameters on what can be an acceptable answer. The witness is a respondent, ‘he
is there to answer questions, that is all’ (Cockburn, I952, p. IO ), and the person who asks the questions is structurally very much in a position of control (Atkinson and Drew, I979) and quick to interrupt witnesses or warn them to confine themselves to the essential facts they are being asked about, or indeed merely to answer yes or no. 

The construction of a case rather than the determination of the truth in court then presents only a partial contextualization of particular facts–a contextualization that excludes other facts deemed irrelevant to the construction of the case at hand. If witnesses offer facts deemed irrelevant, they may be reminded to confine themselves to answering the question asked of them. Pages 22-23:

Prosecutor  [to victim] Did you know him [the defendant] previously?
Witness: Yes we had a scuffle the night before.
Prosecutor [sharply] Mr Sweeney, the question was very simple. Please answer yes or no. Don’t volunteer anything. Understand? (Case g8)

What is often a gray area of unclear and contradictory facts not only becomes presented as clear facts by either lawyer but is often stripped of the meaning given to them by witnesses. From page 23: 

The questions ‘should be clear and unambiguous and as short as possible, each raising a single point’ (Walker and Walker, I975, p. 360) so particularising and abstracting the facts relevant for the case from the multiple possible facts of the incident. This style of presentation helps construct an idea of clear-cut proof, by filtering and controlling the information witnesses make available to the court, and so transforming what could emerge as an ambiguous welter of vying and uncertain perceptions into ‘the facts of the case’.

Interrogation means not just filtering potential information but imposing order and meaning upon it by the sequence and context of questions asked-whatever meaning it may have had to the witness, control by questioning can impose the meaning of the questioner. The case thus takes on its own logic within the framework of the ‘facts of the case’, and any other issues mentioned, hinted at or unknown, lose any relevancy to the meaning of the case that they may have had to the meaning of the incident.

It is not only the right (or rather obligation) of a witness  to answer only questions posed by the lawyer that leads to the filtering of what happened; the right of the lawyer to sum up the “facts of the case” (and not the witness) can easily lead to a distortion of what the witness is saying. From pages 23-24: 

Prosecutor: Weren’t you making as much noise as the others?
Accused: No I was trying to quieten them down.
Prosecutor: You were saying ‘Ssh’ in a whisper?
Accused: No I was saying ‘be quiet or you’ll get into
trouble’.
Prosecutor: And they were making a lot of noise.
Accused: Yes.
Prosecutor: So you had to raise your voice so they’d hear you.
Accused: Well maybe a wee bit.
Prosecutor: So you were shouting and bawling.
Accused: No.
Prosecutor: You just said you were! (Case 19)

The right of the advocate not just to question but to sum up-a right denied to the witnesses themselves-allows still further editing, abstraction, and imputation of meaning to be imposed on what witnesses say.

But, it may be said, the lawyer for the defense at least can do the same thing as the prosecutor (although we have already seen that prosecutors, unlike defense lawyers, use the ideological ploy of claiming to represent the “public interest”). What of the presumed need for the court to show, beyond a reasonable doubt, that the accused is guilty? In the first post, we have already shown that judges narrow proof of guilt by limiting what counts as sufficient proof of guilt. 

Are the so-called legal provisions that protect the accused, such as the presumption of innocence until proven guilty,  actually in truth the way they are presented as being? Or are the legal provisions more like fiction? I will pursue the matter in a future post in this series. 

By the way, before my experience with a court-ordered assessment of the relationship between my daughter, Francesca, and her parents, on the one hand, and the relationship between the parents, on the other, despite calling myself a Marxist, I was naïve enough to believe that the truth was relevant in court manners. I learned the hard way–and so did my daughter indirectly–just how far from the truth court-constructed cases can be (see the series of posts with the title “A Worker’s Resistance to the Capitalist Government or State and its Representatives,” such as  A Worker’s Resistance to the Capitalist Government or State and its Representatives, Part One  or A Worker’s Resistance to the Capitalist Government or State and Its Representatives, Part Four). I am no longer that naïve. 

Conclusion

The ideology that telling the truth is of prime importance in courts is just that–an ideology. What really happened and what is presented in court can diverge widely. Defense attorneys formulate a case and so too does the prosecution. The case is what is important–not the truth. The rules of evidence, for example, restrict what can be presented, and witnesses are asked questions that the defense or prosecution deems relevant to presenting the “case”–and not the truth.

And yet, on TV programs and in movies we are often presented with the proverbial “Do you solemnly swear to tell the truth, the whole truth and nothing but the truth?”–and yet the truth is one thing that really is irrelevant at court. 

But why does the left not criticize this ideology? Should not the left expose the farcical nature of various social structures, including the legal system? Why is there not discussion about the real nature of legal proceedings? Why is there too often acceptance of the illusion–the ideology–of the rule of law? 

What do you think?

Economics for Social Democrats–but Not for the Working Class, Part Two: Critique of the Social Democrat Jim Stanford’s Theory of Money, Part One

Introduction

In an earlier post, I indicated that Jim Stanford’s view concerning the creation of jobs reflects a social-democratic or social reformist position (see Economics for Social Democrats–but Not for the Working Class, Part One: Critique of Jim Stanford’s One-Sided View of Job Creation in a Capitalist Society). In this post and subsequent posts, I will begin to look in more depth at Mr. Stanford’s economic views. It is all the more necessary since the main title of his major book is Economics for Everyone. His book is most definitely not for everyone since, although it appears to be for the working class, it ultimately opposes their interest as a class to struggle for the abolition of capitalism. Furthermore, despite the subtitle of his book, A Short Guide to the Economics of Capitalism, it certainly does not express the nature of capitalist society adequately. 

For example, Mr. Stanford’s definition of money has little to recommend it since it fails to explain to workers how money (and hence prices) confers upon employers the power to direct workers’ lives. Marx’s theory of money, by contrast, is designed to do just that.

The following necessarily involves a theory of money, and it is not easy.

Stanford’s Inadequate Definition of Money Has a Historical Antecedent

Let us look at one of Mr. Stanford’s references to money (related to prices) in his book. Page 189:

Very broadly, money is anything that allows its holder to purchase other goods and services. In other words, money is purchasing power.

Mr. Stanford’s identification of money with “purchasing power,” interestingly enough, already had been expressed by a nineteenth-century author, Samuel Bailey, whose theory Karl Marx criticized. From Elena Lange (2021), Value without Fetish Uno Kōzō’s Theory of ‘Pure Capitalism’ in Light of Marx’s Critique of Political Economy, pages 225-226:

… this position echoes Bailey’s identification of money with ‘power of purchase.’  [Quoting Bailey] ‘If the value of an object is its power of purchasing, there must be something to purchase. Value denotes, consequently, nothing positive or intrinsic, but merely the relation in which two objects stand to each other as exchangeable commodities’. Although we will return to this, Marx’s critique of the notion of money as ‘power of purchase’ presents a useful summary of the previous discussion, namely the inability of a formal, functionalist and nominalist theory of money to explain money’s function of general social exchangeability, or, which is the same, the measure of value. ‘Power of purchasing’
hence does not explain the logical significance of money, but presents a tautology. It is well worth quoting the passage at length: [from Marx]

[Bailey’s] entire wisdom is, in fact, contained in this passage. ‘If value is nothing but power of purchasing’ (a very fine definition since ‘purchasing’ presupposes not only value, but the representation of value as ‘money’), ‘it denotes’, etc. However let us first clear away from Bailey’s proposition the absurdities which have been smuggled in. ‘PURCHASING’ means transforming money into commodities. Money already presupposes VALUE and the development OF VALUE. Consequently, out with the expression ‘PURCHASING’ first of all. Otherwise we are explaining
VALUE by VALUE. Accurately expressed it would read as follows: ‘If the value of an object is the relation in which it exchanges with other objects, value denotes, consequently’ (viz., in consequence of the ‘if’) nothing, but merely the relation in which two objects stand to each other as exchangeable objects’ (I.e., [pp.] 4–5). Nobody will contest this tautology. What follows from it, by the way, is that the ‘VALUE’ OF AN OBJECT ‘DENOTES NOTHING’. For example, 1lb. of COFFEE = 4 lbs of COTTON. What is then the value of 1lb. of COFFEE? 4 lbs of COTTON. And of 4 lbs of COTTON? 1lb. of COFFEE. Since the value of 1lb. of coffee is 4 lbs of COTTON, and, on the other hand, the value of 4 lbs of COTTON = 1lb. of COFFEE, then it is clear that the value of 1lb. of COFFEE= 1lb. of COFFEE (since 4 lbs of COTTON = 1lb. of COFFEE), a = b, b = a, HENCE a = a. What arises from this explanation is, therefore, that the value of a use value = a [certain] quantity of the same use value.

The problem with Bailey’s and Stanford’s characterization of money is that nowhere do they explain why a specific thing called money has this power to purchase at all, and how this power to purchase is different from (and yet related to) other things that are on the market (call them commodities–products of labour that are produced for sale). Other commodities do not have “purchasing power” directly–whereas money does. Why is that? Is there a connection with the purchasing power of money and the lack of purchasing power of all other commodities? 

If money is the power to purchase, then what it purchases, by implication, is not money and lacks purchasing power. Hence, money has a monopoly of power over purchasing, and all other commodities lack this direct power of purchasing.

At one pole, there is money, with its monopoly power of purchasing commodities directly, and at the other pole are commodities that lack this power of direct purchasing power. What explains this situation? Mr. Stanford does not address the issue since he is undoubtedly unaware of the problem. For him, the purchasing power of money is simply given rather than something to be explained. 

[As an aside, this definition is obviously inadequate even from the point of view of workers’ everyday experience. For instance, I use my Royal Bank Westjet Master Card to purchase almost everything (in order to accumulate Westjet dollars to be used to see my daughter, Francesca. 

Although my credit card has purchasing power and thus falls under Stanford’s definition of money, obviously the day of reckoning will arise if I do not transfer my deposit funds to pay off my credit card. From this point of view, the deposit funds are money, but not my credit card.)

Stanford’s Distortion of Marx’s Labour Theory of Value Related to Ignoring Marx’s Theory of the Commodity, Value Form, Money and Prices 

This lack of an explanation of the unique monopoly power of money goes hand in hand with a distortion of Karl Marx’s theory of value and commodities. Mr. Stanford reduces Marx’s theory to the so-called theory that labour in general, and only labour, produces value. From his book (2008) Economics for Everyone: A Short Guide to the Economics of Capitalism, page 54:

An economic underpinning for this fightback was provided by Karl Marx. Like the classical economists, he focused on the dynamic evolution of capitalism as a system, and the turbulent relationships between different classes. He argued that the payment of profit on private investments did not reflect any particular economic function, but was only a social relationship. Profit represented a new, more subtle form of EXPLOITATION: an indirect, effective way of capturing economic surplus from those (the workers) who truly do the work. Marx tried (unsuccessfully) to explain how prices in capitalism (which include the payment of profit) could still be based on the underlying labour values of different commodities. [my emphasis] 

Mr. Stanford’s evident distortion of Marx’s theory comes out even more clearly from the following passage (page 71): 

For simplicity, the classical economists adopted a labour theory of value. In this theory, the prices of producible commodities reflect the total amount of labour required to produce them (including both direct labour and the indirect labour required to produce machines and raw materials used in production – a complication we’ll discuss in the next chapter). Marx realized this simplified theory was wrong: prices under capitalism must also reflect the payment of profit. But he was politically committed to explaining prices on the basis of their “underlying” labour values, so he undertook a complicated (and ultimately unsuccessful) attempt to explain prices on the basis of labour values  [my emphasis]. Neoclassical economists, responding to Marx, tried to provide an intellectual and moral justification for the fact that profits are paid on capital investments by attempting to show that capital itself is actually productive. These efforts, too, were unsuccessful.

In the end, the relevance of this long controversy is not entirely clear. Productive human effort (“work,” broadly defined) is clearly the only way to transform the things we harvest from our natural environment into useful goods and services. In this sense, work is the source of all value added. For society as a whole, just as for that lazy teenager, if we don’t work, we don’t eat. Nothing else – not alien landings, not divine intervention, and not some mystical property of “capital” – is genuinely productive. Under capitalism, profits are paid on capital investments. These profits reflect a social institution called “private ownership,” not any real productive activity or function. (In fact, as we’ll see, it’s not even possible to clearly measure capital, let alone to prove that it is productive.) Because of this institution of private ownership of capital, profits are reflected in the prices of various goods and services (and hence also in GDP).

We can accept that human work is the sole driving force of production while simultaneously recognizing that prices (and things that depend on prices, like GDP) depend on other factors, too – namely, under capitalism, profit.

There are a couple of points worthy of notice in this passage. Firstly, Mr. Stanford’s view that labour is a primary but not exclusive determinant of value (and price–for him there is really no difference between them since he reduces money to purchasing power) is somewhat similar to David Ricardo’s nineteenth century theoretical position, which held a 90 percent labour theory of value, so to speak since Ricardo argued that it was labour mainly but not exclusively that formed the value (and price) of commodities. . Ricardo (1821/2004)  wrote in his On the Principles of Political Economy and Taxation (page 30):

SECTION IV

The principle that the quantity of labour bestowed on the production of commodities regulates their relative value, considerably modified by the employment of machinery and other fixed and
durable capital.

In the former section we have supposed the implements and weapons necessary to kill the deer and salmon, to be equally durable, and to be the result of the same quantity of labour, and we have seen that the variations in the relative value of deer and salmon depended solely on the varying quantities of labour necessary to obtain them,—but in every state of society, the tools, implements, buildings, and machinery employed in different trades may be of various degrees of durability, and may require different portions of labour to produce them. The proportions, too, in which the capital that is to support labour, and the capital that is invested in tools, machinery and buildings, may be variously combined. This difference in the degree of durability of fixed capital, and this variety in the proportions in which the two sorts of capital may be combined, introduce another cause, besides the greater or less quantity of labour necessary to produce commodities, for the variations in their relative value—this cause is the rise or fall in the value of labour.

Secondly, like many reformists (as well as some self-proclaimed Marxists), Mr. Stanford identifies Marx’s labour theory of value as either identical to or merely a variant of Ricardo’s labour theory of value. Ricardo identified labour as such or general labour (which was performed in prehistoric times, in ancient Greece, in feudal Europe, etc.) as the main determinant of the value of commodities. Labour as such is what Mr. Stanford calls “human work is the sole driving force of production.”  Mr. Stanford implies that this is supposedly Marx’s position. Such a view is a complete distortion of Marx’s theory–since it lacks any relation to Marx’s theory of commodities, value, use value, money (and hence prices).

It should be pointed out immediately that Ricardo had a labour theory of value but failed to connect his labour theory of value to the existence of money and its monopoly power of immediate purchasing power. The same applies to Mr. Stanford’s own reference to the purchasing power of money, on the one hand, and his attempt to partially dissociate prices from labour on the other (we cannot even talk of “value” in relation to Stanford’s theory since for him there is really only prices). 

If money is purchasing power, or the capacity to immediately be exchangeable with other commodities (with the other commodities lacking this power), then a theory should be able to explain how and why and through what means money has this power. From Capital: A Critique of Political Economy. Volume 1:  page 186: 

The difficulty lies not in comprehending that money is a commodity, but in discovering how, why and by what means a commodity becomes money.

In terms of the structure of the first two chapters of volume one of Capital, Samezo Kuruma (2018), in his Marx’s Theory of the Genesis of Money How, Why, and Through What is a Commodity Money? has this to say (pages 54-55): 

Marx analyses the how of money in the theory of the value form, and the why of money in the theory of the fetish character, whereas in the theory of the exchange process he examines the question of through what. …  Marx’s indication of these three difficulties clearly suggests that he managed to brilliantly overcome them, but no hint is provided as to where this is carried out. My view is that Marx answered the questions of how, why, and through what, respectively, in Section Three [of chapter one of Volume 1 of Capital], Section Four [of chapter one of Volume 1 of Capital], and Chapter Two [of Volume 1 of Capital]. So the three problems in the sentence are listed in the order that Marx solves them in Capital.

Incidentally, Marx does not pose these three problems as a sort of logical schema or in some frivolous manner; they are realistic problems. Without solving each, an adequate understanding of money is not possible. Indeed, earlier political economy slipped into a variety of errors by failing to solve those problems.

Marx’s explanation of the purchasing power of money lies, on the one hand, in the specific nature of the labour that results in the existence of money as a monopoly power–abstract labour or general human labour or universal labour without distinction. This general social labour, unlike earlier societies, does not find its expression in the immediate results of the production process (the process of producing our lives as human beings).

The reference to the immediate results of a labour process that does not result in a social product directly means that it can only be expressed indirectly or through a process of mediation–the exchange process. Contrary to Stanford’s characterization of Marx’s theory of value, the kind of labour is therefore historically specific and not some general social labour that exists and acts as or functions exclusively as social labour regardless of  the kind of society. Stanford, however, presents Marx’s labour theory of value as just that: as ahistorical. 

Abstract labour is a kind of negative labour–it is not social labour as workers work concretely or materially, and it is this labour which produces the value of a commodity, say beer, and not the labour which produces the beer as beer concretely.

On the other hand, a definite kind of labour, concrete labour, produces a definite kind of  use value, say beer. But the result of this concrete labour, since it is linked to abstract labour, is a commodity that is not yet social in its concrete form of beer. A further process–the exchange process–is required to convert the beer into a form where it can function as “purchasing power”–by being able to be converted into any form of commodity–money. 

At one pole is the commodity, beer, which lacks “purchasing power,” and at the other pole is money, which monopolizes purchasing power. 

I will elaborate on this in the next section.

Mr. Stanford, therefore, does not have a theory of money that links money to a specific kind of production. His theory of money as purchasing power, like Bailey’s theory, is an exchange theory of money. Marx, on the other hand, had a production theory of money that referred to a specific kind of society. That theory, however, cannot be characterized as merely a labour theory of value; Marx in fact had a dual or twofold theory of labour.

Marx’s Dual or Twofold Theory of Labour and Commodities

This labour that is connected to the monopoly purchasing power of money is not general labour that human beings have performed throughout history, but labour that is organized in a specific way–as I pointed out in one of my published articles, Dewey’s Materialist Philosophy of Education: A Resource for Critical Pedagogues? In pages 259-288, The European Legacy, Volume 11, Issue 3, pages 274-275: 

Marx provided a systematic logical critique of present capitalist society (the contextual basis for the functioning of schools), on the basis of a dual theory of use or a dual theory of labour. It is this theory which provides the ground for his analysis and critique of capital as well as his subsequent account of the history of the emergence of capital. It is an understanding of capital logically via the twin concepts of concrete and abstract labour, and their further development, which constitutes his critique; an understanding of the coming into being of capital presupposes this logical determination.

Marx relied on Aristotle’s distinction between the use of shoes as shoes and the use of shoes as a means for obtaining another commodity (as a means of exchange):

Take for example, a shoe—there is its wear as a shoe and there is its use as an article of exchange; for both are ways of using a shoe, inasmuch as even he that exchanges a shoe for money or food with the customer that wants a shoe uses it as a shoe, though not for the use peculiar to a shoe, since shoes have not come into existence for the purpose of exchange.

Both are uses of shoes, but they are not the same kind of use. Marx expanded the idea of the dual use of things to include labour in capitalist society. Labour in capitalist society has a dual use which constitutes a contradictory dynamic that develops the material production process, while also tending to undermine the material production process through crises. Marx evidently considered that a dual theory of the use of things or a dual theory of labour was central for a critical understanding of capitalist society:

[London], August 24, 1867
The best points in my book are: 1) the two-fold character of labour, according to whether it is expressed in use value or exchange value. (All understanding of the facts depends upon this.) It is emphasised immediately, in the first chapter.

Marx reiterated the importance of the two-fold character of labour for his critique of capitalist society a few months later:

[London], January 8, 1868

It is strange that the fellow [Eugen Duhring] does not sense the three fundamentally
new elements of the book:
. . . 2) That the economists, without exception, have missed the simple point that if the commodity has a double character—use value and exchange value—then the labour represented by the commodity must also have a two-fold character, while the mere analysis of labour as such, as in Smith, Ricardo, etc., is bound to come up everywhere against inexplicable problems. This is, in fact, the whole secret of the critical conception.

It is Marx’s argument that social labour, in the form of abstract human labour, has distinctive characteristics which oppose it to human labour as concrete labour. It is only through being connected to other labours indirectly that it becomes social labour. The concrete labour that is performed has no direct connection to the labour of other people. To put it another way, the material process of life and the social process of life, which form a unity in the case of human beings, since human beings are both material and social beings, is sundered in capitalist society.

This situation can also be expressed in terms of parts and wholes. Each capitalist unit is a part of the total division of labour. However, this part is quite curious. It is a part that does not function as a part qualitatively while human labour is being expended. The labour being performed is not social labour, connected to other human labour and determinate needs. It needs to become a part only after the micro-production process is at an end, if it is to count as a part of the whole.

Since concrete labour is not social labour as it is being performed, and since the latter is not expressed immediately in concrete use-values, the possibility arises that the amount of concrete labour does not translate into the same amount of social labour. This possible non-identity has major implications for the structure of human life: a dynamic quantitative process is built into production. The quantity of labour required to produce output becomes a concern because the mere expenditure of concrete human labour does not necessarily suffice to meet standards set by the general level of productivity in a particular industry. If those standards are not met, the capitalist firm cannot in the long run reproduce itself. For the capitalist firm to survive, an external pressure is brought to bear on producers to meet that standard. The peculiar character of the part of a whole in capitalist production is thus that the quality of functioning as part of total social labour is transformed into a purely quantitative form. The specific quality of social labour in capitalist society is the priority of its quantity over its concrete quality, or abstract labour over concrete labour.

There is further evidence that Marx considered the twofold character of labour to be of major importance. Ironically, Marx explicitly underlines its importance by providing a separate heading for it in the first chapter and emphasizing its importance for his critique of political economy (Capital, Volume 1: pages 131-132):  

2. THE DUAL CHARACTER OF THE LABOUR EMBODIED IN COMMODITIES

Initially the commodity appeared to us as an object with a dual character, possessing both use-value and exchange-value. Later on it was seen that labour, too, has a dual character: in so far as it finds its expression in value, it no longer possesses the same characteristics as when it is the creator of use-values. I was the first to point out and examine critically this twofold nature of the labour contained in commodities. As this point is crucial to an understanding of political economy, it requires further elucidation.

This dual character of labour produces a commodity–a contradictory unity of use value and value, and this is linked to the nature of money.

The Dual or Twofold Character of Labour and Commodities, on the One Hand, and the Nature of Money (or the Form of Value) on the Other: Or How a Commodity Becomes Money 

Marx’s dual theory of labour is related to Marx’s dual theory of commodities. Commodities have two essential aspects to them: they are both use values and values, and concrete labour produces use values whereas abstract labour produces the value of the commodity. 

This nature of commodities as involving two essential aspects is not, however, immediately expressed in the commodities themselves. It is only concrete labour that is expressed in the use value of the commodity as the specific kind of labour that produces the specific kind of commodity, such as beer. The concrete labour which we performed in the Calgary brewery where I worked, for example, resulted in the concrete beer as beer. Simultaneously, the social nature of the labour performed, as forming part of the total labour of society within a division of labour, is not social labour in its immediate form as beer.

Since a social process emerged that resulted in the performance of labour that is not immediately social in nature (a negative process, if you like), another process is required to express the social nature of the labour performed–a process of exchange. 

From Capital, Volume 1, page 165:

Objects of utility become commodities only because they are the products of the labour of private individuals who work independently of each other. The sum total of the labour of all these private individuals forms the aggregate labour of society. Since the producers do not come into social contact until they exchange the products of their labour, the specific social characteristics of their private labours appear only within this exchange. In other words, the labour of the private individual manifests itself as an element of the total labour of society only through the relations which the act of exchange establishes between the products, and, through their mediation, between the producers. 

Since the concrete labour performed is not social labour directly but only indirectly, its social nature can only be expressed indirectly–through another, different commodity, in the use value of another commodity. However, merely expressing one commodity, say beer, in another commodity, say in steel, would not express the general social nature of the labour that produces value. To express adequately abstract labour and value, it is necessary that the internal opposition between the concrete labour and concrete use value, on the one hand, of the commodity be completely contrasted with abstract labour and value on the other in an external form–ultimately in money as the unique commodity that has the monopoly power of being able to purchase any commodity. This monopoly power of money necessarily excludes such power attaching to the other commodities. Capital, Volume 1, page 161:

Finally, the last form, C [practically, the money form], gives to the world of commodities a general social relative form of value, because, and in so far as, all commodities except one are thereby excluded from the equivalent form. A single commodity, the linen, therefore has the form of direct exchangeability with all other commodities, in other words it has a directly social form because, and in so far as, no other commodity is in this situation. 26

26. It is by no means self-evident that the form of direct and universal exchangeability is an antagonistic form, as inseparable from its opposite, the form of non-direct exchangeability, as the positivity of one pole of a magnet is from the negativity of the other pole. This has allowed the illusion to arise that all commodities can simultaneously be imprinted with the stamp of direct exchangeability, in the same way that it might be imagined that all Catholics can be popes. It is, of course, highly desirable in the eyes of the petty bourgeois, who views the production of commodities as the absolute summit of human freedom and individual independence, that the inconveniences resulting from the impossibility of exchanging commodities directly, which are inherent in this form, should be removed.

Money is the form of value–the expression of value, or the expression of the general nature of the labour that is not directly social. The internal opposition of abstract labour and concrete labour, and value and use value, finds expression through the external opposition of all commodities on the one side expressing their value in one commodity–money.

Stanford’s definition of money as “purchasing power” simply fails to address “how, why and through what means” something can serve as money or purchasing power of commodities. 

Obviously, not all social labour is expressed in this form; when I cooked for my daughter, my cooking was social in nature but it did not assume a form different from the concrete result. In a capitalist society, by contrast, the social nature of labour assumes–and must assume–a form external to the concrete use value produced by concrete labour. 

Political Implications of the Monopoly of the Purchasing Power of Money

The connection between a specific character of social labour and money has political implications since such a connection expresses a kind of society that necessarily escapes the control of the workers and in fact leads, ultimately, to the control over them of their own products. 

Elena Lange(2019) has addressed this issue by noting that Marx’s theory is a theory of fetishism and not just a labour theory of value in her article “The Transformation Problem as a Problem of Fetishism,” pages 51-70, in Filosofski Vestnik, Volume 40, issue Number 3, page 52: 

To treat Marx’s theory as purely an economic theory without any political implications, of course, is useful for both academics–and for the class of employers. 

For Marx, lacking in the classics, and strangely ignored in Marx‘s modern interpreters, the distinction between abstract and concrete labour is the crucial critical heuristic to clear the path to a thoroughgoing critique of the capitalist relations of production and its inverted self-representations. This distinction is directly reflected in the formulation of the labour theory of value, by determining the social substance of value as abstract-general human labour and distinguishing it from concrete labour as manifested in the commodity’s use-value.  This conceptualisation equally allowed Marx to pierce the problem of form and content – the problem of fetishism.

Mr. Stanford, by assuming as a fact the direct purchasing power of money rather than explaining it, misses the connection between the monopoly of the purchasing power of money and the lack of social power of all other commodities–including workers (after all, there is a market for workers, is there not?). 

The nature and implications of this connection between the production of commodities (a contradictory unity of use value and value) via abstract and concrete labour, the expression of the value of a commodity in money and the fetishism of commodities will be addressed in another post in this series, however. The next post in this series will look at how the exchange process escapes the control of the participants in the exchange process 

Conclusion

Mr. Stanford’s definition of money as purchasing power is definitely an inadequate definition of the nature of money since it excludes the conditions for something to be money: concrete labour cannot be directly social labour. His interpretation of Marx’s so-called labour theory of value is also definitely inadequate since it excludes any consideration of the dual nature of labour and commodities in a capitalist society; in effect, he treats Marx’s theory to be a variant of Ricardo’s ahistorical theory of all labour throughout history somehow producing (exchange) value. Ricardo’s labour theory of value has little connection with the necessity for money to arise, on the one hand, and the monopoly nature of money (and the simultaneous exclusion of other commodities) on the other.   

Mr. Stanford’s definition of money as “purchasing power” has also a parallel in Ricardo’s theory in that both fail to connect their theory of money to capitalist production. 

Stanford’s view, similar to Ricardo’s view, that somehow labour is more or less the primary cause of the quantitative price of commodities but not the exclusive cause once “capital” (meaning machinery and other means of production that last longer than one year) fails to engage in any inquiry into the peculiar kind of labour (really a kind of organizing social labour) that needs to be expressed in something other than the immediate use value (such as beer) which is produced. 

 His reduction of Marx’s theory to Ricardo’s theory leaves Mr. Stanford’s theory of money without any connection to the purchasing power that money has–a power that ultimately is exercised over the working class. The twofold or dual nature of labour necessarily involves the expression of the nature of abstract labour as value in the form of money, which excludes all other commodities from being money; purchasing power on one side necessarily involves a lack of such a power on the other side. 

Mr. Stanford’s economics for everyone–is it really for the working class? 

The connection between a specific character of social labour and money has political implications since such a connection expresses a kind of society that necessarily escapes the control of the workers and in fact leads, ultimately, to the control over them of their own products. That connection will be explored in another post.