What do these 34 posters all have in common?

[SirTomJones]

and that welsh **** tom jones. fecking sheepherding farmer. you know he's on all kinds of gov't subsidies and social program.

Charming. Sometimes I think being on the dole is a lot easier than working. Hey get a girl knocked up and you get more money and a house.

[Drunken Cat]

I would have been quite offended if I was not included.

[Drunken Cat]

I'd might as well put this here.

I actually had a run in yesterday with a very friendly, and intelligent economics professor about the labor theory of value. He made the callous claim that he could destroy it in a couple of seconds.

When I challenged him to do so, he attempted to do so using Ricardian trade theory (an odd approach, seeing as how one of Marx's greatest influences was David Ricardo, and Marx knew Ricardo inside and out). He drew up a chart to demonstrate that with two countries trading in two commodities (the typical Ricardian schema), there is the potential that each country can specialize in the one commodity to the complete exclusion of the other (e.g. Country A specializing in Commodity X, and Country B specializing in Commodity Z). He argued that under such a condition, any productive effort to produce Commodity Z in Country A would be unprofitable, and therefore this disproves Marxian labor theory of value (ironically, it is actually Ricardian Labor Theory of Value, which was perfected by Marx).

I merely had to point out that under labor theory of value, the labor must be socially necessary to create value. Under the conditions which he presented, any labor expended in Country A on Commodity Z does not meet the necessity of socially necessary, and can produce no value. (I didn't have a chance to point out that the price of a good, as it reflects the good's exchange value, has nothing to do with the cost of the labor (e.g. the wage), as he also claimed. Rather, the wage is deducted from the value which is produced by the expenditure of socially necessary labor power, and the residual of this is the source of all capitalist profits.)

Well, at this point I was told that I was bringing in terminology ('socially necessary labor power') which would need to be defined to carry on the discussion, for which there was no time.

He was a nice guy, really, and is a good professor. But, these guys just make these statements, and yet they don't even know the meaning of the theories they are denouncing. The guy has no understanding of Marxian labor theory. He styles himself as something of an expert on Ricardo, but I doubt he understands Ricardo's discourses on the theory, either.

[One_Tycoon]

That guy is probably a leftist and confused...thus trouble making proper arguments simplified in easily understood terms. I'm a simple man myself and prefer the simple answers rather than esoteric academics talk where two central planning ego's think they're smarter than everybody in the world. However this piece seems to do the trick in knocking marxian labor theory in it's proper place. And it stimulates my Capitalist confirmation bias:



Labor Theory of Value


The labor theory of value is the bedrock basis of Marxist or socialist economic theory. Disagreements between the socialist theory and that of the free marketeer can ultimately be traced back to the question of the theory of value.

The labor theory of value states that all value is a result of human labor. The theory has a certain initial plausibility since laboring does commonly result in additional value. However, a closer brief analysis reveals the obvious errors in such a theory.

If the labor theory of value was correct then a diamond found in a diamond mine would be of no greater value than a rock found right next to it since each would require the same "amount" of labor-time. A photo of a loved one would have the same value as a photo of a total stranger or of a hated enemy--check your wallets or desktops to test this theory. According to the labor theory of value if you have a slice of pizza for lunch, valued because of the labor-time required to produce it, you must necessarily value the next slice the same. The labor theory of value is a denial of the well-established law of diminishing marginal utility which states that the value to the consumer falls with additional consumption of the good in question. How a true believer Marxist ever justifies ceasing pizza eating is still a mystery.

One has to wonder what two Marxists attending a movie do as they leave together. Is each timid in expressing his opinion as to the pleasure or displeasure of the experience since he may disagree with his companion? After all, the movie required the same amount of labor-time in its production. How in this theory can the value of land space, a nature-given resource, ever be explained? According to the labor theory of value, if a skilled carpenter produces a solid, comfortable chair which is useful for decades in a mere four hours, whereas a klutz in four days produces a chair which collapses with the first attempted use, the latter chair is more valuable. (Marx had an escape hatch for this last dilemma: Only "socially necessary labor" creates value; however, Marx defines socially necessary in terms of the competitive market itself--thus we are right back to the market values Marx so vehemently abhorred!)

The labor theory of value resulted from the mistake of David Ricardo, who proceeded from Adam Smith's error in ascribing value to the total costs of production. Marx understandably built on Ricardo's theory and concluded that these costs can be traced back to the costs of labor--capital equipment being "frozen labor."
The alternate theory, the correct theory of value, is that value is subjective. The subjective theory of value concludes that goods have no inherent value, that goods are valuable only to the degree that there is a valuer desiring the good.

Returning to the examples above, the diamond is more valuable because people enjoy a diamond more than a rock, a photo of someone dear is more important to the photo owner than a photo of a stranger. People stop eating pizza after a few slices because the (necessarily subjective) pleasure diminishes with additional consumption; different movies appeal to different patrons' tastes. A working chair is preferred to a pile of chair pieces.

More fundamentally, Marx came to his labor theory of value from searching for an equality in the two goods which are exchanged for one another. Of course, Marx thought that the labor embodied in each good was that equality (rather than other factors he first discarded, such as weight, volume, etc.). But the nature of exchange is such that trade only occurs when there is an inequality in the subjective value of the good received and the good exchanged. If equality were indeed the basis of exchange, and say an orange was exchanged for a fish due to the equal amount of labor embodied in each, then logically, the two parties would immediately trade the two goods again since they are still equal in labor. This would become a never ending process until the two traders collapsed dead! As another example, and to test this theory, how many times have you traded a dollar bill for a dollar bill, and then traded them back, and then again?

In short, the whole of socialist economic theory is derived from the mistaken labor theory of value--it collapses for lack of a base; the whole of free market economic theory is derived from the solid base of the valid subjective theory of value.

[Drunken Cat]

That guy is probably a leftist and confused...thus trouble making proper arguments simplified in easily understood terms. I'm a simple man myself and prefer the simple answers rather than esoteric academics talk where two central planning ego's think they're smarter than everybody in the world. However this piece seems to do the trick in knocking marxian labor theory in it's proper place. And it stimulates my Capitalist confirmation bias:



Labor Theory of Value


The labor theory of value is the bedrock basis of Marxist or socialist economic theory. Disagreements between the socialist theory and that of the free marketeer can ultimately be traced back to the question of the theory of value.

The labor theory of value states that all value is a result of human labor. The theory has a certain initial plausibility since laboring does commonly result in additional value. However, a closer brief analysis reveals the obvious errors in such a theory.

If the labor theory of value was correct then a diamond found in a diamond mine would be of no greater value than a rock found right next to it since each would require the same "amount" of labor-time. A photo of a loved one would have the same value as a photo of a total stranger or of a hated enemy--check your wallets or desktops to test this theory. According to the labor theory of value if you have a slice of pizza for lunch, valued because of the labor-time required to produce it, you must necessarily value the next slice the same. The labor theory of value is a denial of the well-established law of diminishing marginal utility which states that the value to the consumer falls with additional consumption of the good in question. How a true believer Marxist ever justifies ceasing pizza eating is still a mystery.

One has to wonder what two Marxists attending a movie do as they leave together. Is each timid in expressing his opinion as to the pleasure or displeasure of the experience since he may disagree with his companion? After all, the movie required the same amount of labor-time in its production. How in this theory can the value of land space, a nature-given resource, ever be explained? According to the labor theory of value, if a skilled carpenter produces a solid, comfortable chair which is useful for decades in a mere four hours, whereas a klutz in four days produces a chair which collapses with the first attempted use, the latter chair is more valuable. (Marx had an escape hatch for this last dilemma: Only "socially necessary labor" creates value; however, Marx defines socially necessary in terms of the competitive market itself--thus we are right back to the market values Marx so vehemently abhorred!)

The labor theory of value resulted from the mistake of David Ricardo, who proceeded from Adam Smith's error in ascribing value to the total costs of production. Marx understandably built on Ricardo's theory and concluded that these costs can be traced back to the costs of labor--capital equipment being "frozen labor."
The alternate theory, the correct theory of value, is that value is subjective. The subjective theory of value concludes that goods have no inherent value, that goods are valuable only to the degree that there is a valuer desiring the good.

Returning to the examples above, the diamond is more valuable because people enjoy a diamond more than a rock, a photo of someone dear is more important to the photo owner than a photo of a stranger. People stop eating pizza after a few slices because the (necessarily subjective) pleasure diminishes with additional consumption; different movies appeal to different patrons' tastes. A working chair is preferred to a pile of chair pieces.

More fundamentally, Marx came to his labor theory of value from searching for an equality in the two goods which are exchanged for one another. Of course, Marx thought that the labor embodied in each good was that equality (rather than other factors he first discarded, such as weight, volume, etc.). But the nature of exchange is such that trade only occurs when there is an inequality in the subjective value of the good received and the good exchanged. If equality were indeed the basis of exchange, and say an orange was exchanged for a fish due to the equal amount of labor embodied in each, then logically, the two parties would immediately trade the two goods again since they are still equal in labor. This would become a never ending process until the two traders collapsed dead! As another example, and to test this theory, how many times have you traded a dollar bill for a dollar bill, and then traded them back, and then again?

In short, the whole of socialist economic theory is derived from the mistaken labor theory of value--it collapses for lack of a base; the whole of free market economic theory is derived from the solid base of the valid subjective theory of value.

I'll give this a read. But, I'll interject my comments, as I go.

Labor Theory of Value


The labor theory of value is the bedrock basis of Marxist or socialist economic theory. Disagreements between the socialist theory and that of the free marketeer can ultimately be traced back to the question of the theory of value.

The labor theory of value states that all value is a result of human labor. The theory has a certain initial plausibility since laboring does commonly result in additional value. However, a closer brief analysis reveals the obvious errors in such a theory.

If the labor theory of value was correct then a diamond found in a diamond mine would be of no greater value than a rock found right next to it since each would require the same "amount" of labor-time.

This is a pure fallacy of interpretation. No labor power expenditure can produce value which is not socially necessary. The general bench mark of what is socially necessary is the condition of 'exchange value'. Therefore, whereas the diamond has considerable exchange value, the rock next to it does not. Therefore, any labor power expended on excavating the rock is merely wasted.

The principal is based on the observation that, whereas basically everything is reducible to a common medium (i.e. land, machinery, etc.), labor is the one thing for which there is the ability to distinguish with respect to the systematic dynamics of capitalist production; moreover, it is the one thing for which there is a capability to systematically (and on a social scale) exploit.

A photo of a loved one would have the same value as a photo of a total stranger or of a hated enemy--check your wallets or desktops to test this theory.

A simple suggestion, from me to thee. Read Marx. And, then criticize it. In other words, you can't criticize something of which you have no knowledge.

According to the labor theory of value if you have a slice of pizza for lunch, valued because of the labor-time required to produce it, you must necessarily value the next slice the same.

And, now I am done. I have already done all of the explaining above.

Thank you, one capitalist. This is precisely the sort of example I was referring to, when I spoke of people criticizing Marxian economic theory, who are completely ignorant of it. Great example.

The labor theory of value is a denial of the well-established law of diminishing marginal utility which states that the value to the consumer falls with additional consumption of the good in question. How a true believer Marxist ever justifies ceasing pizza eating is still a mystery.

One has to wonder what two Marxists attending a movie do as they leave together. Is each timid in expressing his opinion as to the pleasure or displeasure of the experience since he may disagree with his companion? After all, the movie required the same amount of labor-time in its production. How in this theory can the value of land space, a nature-given resource, ever be explained? According to the labor theory of value, if a skilled carpenter produces a solid, comfortable chair which is useful for decades in a mere four hours, whereas a klutz in four days produces a chair which collapses with the first attempted use, the latter chair is more valuable. (Marx had an escape hatch for this last dilemma: Only "socially necessary labor" creates value; however, Marx defines socially necessary in terms of the competitive market itself--thus we are right back to the market values Marx so vehemently abhorred!)

The labor theory of value resulted from the mistake of David Ricardo, who proceeded from Adam Smith's error in ascribing value to the total costs of production. Marx understandably built on Ricardo's theory and concluded that these costs can be traced back to the costs of labor--capital equipment being "frozen labor."
The alternate theory, the correct theory of value, is that value is subjective. The subjective theory of value concludes that goods have no inherent value, that goods are valuable only to the degree that there is a valuer desiring the good.

Returning to the examples above, the diamond is more valuable because people enjoy a diamond more than a rock, a photo of someone dear is more important to the photo owner than a photo of a stranger. People stop eating pizza after a few slices because the (necessarily subjective) pleasure diminishes with additional consumption; different movies appeal to different patrons' tastes. A working chair is preferred to a pile of chair pieces.

(I had to delete the last two paragraphs, because it was too long to post, so see One Capitalist's post, for the last two paragraphs).

[SirTomJones]

Copy and paste job again.


Bore off.

[One_Tycoon]

So basically you just added some more confusing mumbo jumbo for me to decipher, pretending to be a snobby economist.....followed up by 'nobody understands theory of value, go readit'..even though the guy simplified it and broke it down like a champ.

Ok...

From what I do know is that

Capitalism >>> Socialism.

[Drunken Cat]

So basically you just added some more confusing mumbo jumbo for me to decipher, pretending to be a snobby economist.....followed up by 'nobody understands theory of value, go readit'..even though the guy simplified it and broke it down like a champ.

Ok...

From what I do know is that

Capitalism >>> Socialism.

No, I basically interjected some of my critique of the 'critique', based on my own personal readings of Marxian economic theory, and also alluded to the fact that so-called critiques are frequently grounded in ignorance, as in the case of the one you quoted.

And no, it does not break it down and make it understandable. As a precondition to breaking something down, you must first understand it, which this writer very obviously does not (with respect to Marxian labor theory of value).

And I know that the language and terminology gets complicated, but this is quite unavoidable.

[Drunken Cat]

And to the "pretending to be a snobby economist" line, I've said it on here already, so no point in being shy.

I've just completed a Master's in economics.

I am no economist. I am simply someone who has studied economics, a bit.

That's where I am coming from, nothing more.

[One_Tycoon]

And to the "pretending to be a snobby economist" line, I've said it on here already, so no point in being shy.

I've just completed a Master's in economics.

I am no economist. I am simply someone who has studied economics, a bit.

That's where I am coming from, nothing more.

Good luck. Hopefully though..you get hired by someone in the Japanese govt or at best a private company... rather than our U.S. govt giving you a job to further help in wrecking our economy.

I prefer substance over confusing linguistics. Furthermore, pure Free Market Capitalism of the Minarchist kind doesn't require Full-time Economists as a profession in the first place; it works because of it's ideal simplicity and economic non-intervention from govt forces. The only reason Free Market, Austrian type Economists exist or are even needed around is because we need a push back on the monopoly in economic ideas. They are a necessary response to the already existing Socialist/Marxist/Keynesian/Central planning (difference without distinction) control freak Economists, who have a monopoly in our Universities; Who think they've got it all figured out, and if only someone high up in govt puts them in charge, they can run our lives from the top down with their grand ideas and theories. But hey, don't question them because "you're not an economist or as smart as them, therefore you don't understand". Right...therefore they shouldn't be running anything of that magnitude if the masses don't understand. Not on monetary or fiscal policy. Stay in the private sector.

Rather, we need a decentralized economy with the public sector looking like a needle in a haystack compared the huge Private Sector, without any domino effects because the govt screwed up. In other words...You run your business and be the economist of your independent business, and I'll be the boss/economist/statistician of mine. And lets see who generates revenue, who profits and attracts demand. And if I fail and you do better, then good....i don't get a govt bailout or vice versa. The ease and conditions of doing business stay the same (no knee jerk policies, laws or regulations) i and the whole country doesn't crumble because of one Company's failure. Pretty simple stuff.

One_Capitalist....