"Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration." — Lincoln's First Annual Message to Congress, December 3, 1861.
Understanding Society
Lincoln and Marx
Daniel Little | Chancellor of the University of Michigan-Dearborn, Professor of Philosophy at UM-Dearborn and Professor of Sociology at UM-Ann Arbor
My favourite Lincoln quote: “The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers.”
ReplyDeleteMMTers are actually half way to accepting that point in that they believe in having the state create money and spend it (and/or cut taxes) in a recession: and all so as to make up for the vagarities and gyrations in demand brought about by the private money creation process organised by private banks (booms, busts, credit crunches etc).
The logical extension of that is to ban private money creation.
You cannot ban anything if your so-called "sovereign" currency is tied up and held hostage by shadow derivative banking which is unregulated.
DeleteIt is the reason why MMT is fictitious and unspoken since the neoliberals use the back door MMT to usurp the equality and access to capital.
The banks must go.
Not the rich people but the banks.
The general public does not have representation for access to currency.
During Lincoln's times:
ReplyDelete"Labor is prior to, and independent of, the metals. Metals are only availble thru the fruit of labor, and could never have existed above ground if labor had not first existed. Labor is therefore the superior of the metals, and deserves much the higher consideration."
Now today:
"A state currency system is established prior to, and independent of, labor. Labor is only performed to obtain the fruit of our state currency system, and would never have been performed if our state currency system had not first existed. Our state currency system is therefore the superior of labor, and deserves much the higher consideration."
rsp,
@Matt
ReplyDeleteIs there a sarcasm?
Truth is that present level of labor would not exist, and the advance of it would not exist as such.
Also true is that this large population could not exist without state currency system.
But people and labor can exist in gift system without state currency but not in this large numbers.
Lack of organization size and complexity possible under state currency system would reduce population size the planet can accomodate.
In other paradigm terminology, currency allows for unlimited ammount of gift memory and gift exchange.
And let's not forget Lincoln was assassinated by a libertarian shouting 'death to tyrants!'
ReplyDeleteJure,
ReplyDeleteNo, no sarcasm from me here...
(FD: I am not a libertarian in any way/shape/form...)
I think the concept of Marx's 'Capitalism' is as Warren puts it "gold standard thinking..." and does not apply today under our current system, whether there are still some who appear to choose to believe so or not...
Think about our auto industry and manufacturing/logistics/supply contracts/etc and delivering over 15m autos all the labor involved ... how can any of that get done under a "barter system", or our large healthcare institutions with surgical/pharma/rehab/etc how are we going to operate complex systems with "barter" ? Or even under the metals? It cant happen...
that is why we have systems of state currency...
And we can still gift things to each other under this system we do it all the time thru volunteering, unpaid positions, clubs, hosting parties, etc...
But when it comes to serious things that are basic to our human provision or "means of subsistence", ie food systems, education, medical, logistics, security, travel & leisure, etc... we want to be PAID and should be paid well.... ALL of us... this is best facilitated by a system of state currency...
This last line here: "Our state currency system is therefore the superior of labor, and deserves much the higher consideration."
If you think about this, if we had leadership that was not libertarian, and truly understood the authority inherent in our govt institution to operate a state currency system, there would be no more "labor problems"...
so this system DOES deserve 'the higher consideration' as this system can facilitate the elimination of not 'labor' (we are all still going to have to work to provision ourselves, we just want to be PAID well) but rather thru it we impose authority and hence judgement to eliminate 'labor problems' which imo is Marx's main point, iow Marx didnt have a problem with us having to 'labor', but he just railed against 'labor problems' like conditions/equity/etc... these problems which are inherent under metals as they are scarce and can be hoarded... but can be easily eliminated under a system of state currency....
imo this authority scares libertarians of which there are WAAAAAAY too many of these libertarian morons occupying/usurping our majesterial positions right now... this is the main problem...
rsp,
Ralph, I tend to agree with Bernard Lietaer that a single source of money creation is asking for tyranny of money. It's safer to spread the risk.
ReplyDelete"Our state currency system is therefore the superior of labor, and deserves much the higher consideration."
ReplyDeleteSo just to clarify my thinking, labor serves the function of currency... or is it the other way around?
"...there are WAAAAAAY too many of these libertarian morons occupying/usurping our majesterial positions right now..."
Matt - I think that the libertarian movement is in ascendancy at this time, but there are still very few actual libertarians who have been elected to public office. Moreover, if they have been elected, can you explain how they are usurping power? Aside from the handful of libertarians in Congress who have been making the headlines recently, who are you referring to?
@Matt
ReplyDeleteI would say that is 90% true.
And, yes, at the present, currency needs bigger consideration in order for labor to get deserved award. But that is because of class war that 1% is winning at the present. And only state power can reverse the loses of labor.
I mention complexity and the size as a benefit of currency use, but organization and labor are still underlying the currency.
"we just want to be paid well"
Present distribution does not value laborer as much as organizer (owner of capital) even tough both are necessery.
It is the overly random distribution that is the real problem and optimal state currency system still requeirs labor to set it up.
So even the process of setting up the state currency system demands organizing and labor so that it can be used to eliminate problems of random distribution of currency.
The values of labor against currency need to be balanced at all times and both are still interdependent.
At the present time, yes, state currency needs bigger consideration so that labor get deserved consideration.
Karl Marx was one of the unsung heroes of the Union states in American Civil War. At the time he was writing from London as a foreign correspondent for the New York Herald Tribune. He reported on how the UK was financing the Confederacy because they did not want an emerging US industrial power to compete with them. The southern economy which was dominated by cash crops like cotton and tobacco was much more akin to the British model employed throughout their colonial empire, as per Mosler's description of British efforts to cultivate coffee on plantations in Ghana.
ReplyDeleteInterestingly enough, while both North & South printed fiat currency to finance the war, the South apparently printed to excess and in the process unleashed even more inflation than the North. Not only did derivative markets flourish in this monetary environment, but they were an essential ingredient for the Confederacy to sell their debt to the UK. Confederate debt often included call option features giving investors the right to receive interest payments and redeem principal either in Confederate currency or in bails of cotton, tobacco and some other cash crop.
@Rombach
ReplyDelete"So just to clarify my thinking, labor serves the function of currency... or is it the other way around?"
It is both ways, it is in the feedback loop of a dynamic system.
Why everything has to be black and white, when most of universe is a dynamic system? Selfsustainable dynamic system with feedback loops and stock/flow dynamics.
"our majesterial positions " does not mean only Congress as you implied but all controlling elites. Super wealthy are majesties of our time.
Lincoln was a corporate lawyer before entering politics. As President, he was in the pocket of the railroads. Lincoln's populist credentials are greatly exaggerated by internet memes.
ReplyDeleteAs Nixon's attorney general advised, judge them politicians what they do, not by what they say.
"our majesterial positions " does not mean only Congress as you implied but all controlling elites. Super wealthy are majesties of our time."
ReplyDeletePerhaps so, but that doesn't make them libertarian. If anything, our corporate ruling elites are fascist.
Interestingly enough, while both North & South printed fiat currency to finance the war, the South apparently printed to excess and in the process unleashed even more inflation than the North.
ReplyDeleteLincoln realized the need to increase taxes to prevent inflation through greenback funding, anticipating Lerner. He also had the power to collect taxes levied.
The South didn't realize this and didn't have the organized tax collection power that the North had anyway.
What Lincoln says about labor and capital (goods) is obvious. Labor (real producers) produce both consumer and capital goods. This is the basis of the crude form of the labor theory of value put forward by Adam Smith for example. This was a simple extension of the observation of the economists of the time that emphasized this about agricultural production, which was the dominant form of production at that time. Smith was saying that it's also true of capital goods.
ReplyDeleteThere the disconnect between the crude and advanced forms of the labor theory of value emerge is in the distinction between knowledge work and manual work. Initially, the distinction was slight with land owners being passive in production and agricultural workers the actual producers. This hard distinction began to be blurred with the introduction of capitalism, entrepreneurship, management and knowledge work.
But the distinction remains that product, the output of production, is the result of the inputs, which are energy, materials and work, with work giving materials the characteristics of consumer and capital goods through the use of energy, some of which is used by the workers as food and some by the physical means of production as electricity, etc.
This is just analyzing production and not distribution and consumption, whose circular flow in a modern economy is monetary. But Lincoln's observation about production is correct and powerful.
Ed,
ReplyDeleteLooks at this dork:
http://hnn.us/article/152608
Now tell me that this guy (and his employer) are not morons.... please?!?
and to repeat: I do NOT put you "in the same boat" as these people.... FAAAARRR from it Ed...
rsp,
Maybe only slightly related to the topic at hand, but I just came across it: Alan Watts On Money
ReplyDeletehttp://www.youtube.com/watch?v=kh5MhxniYh8
One can find documents Little refers to at www.marxists.org.
ReplyDeleteSalmon Chase was the guy who explained MMT finance economics to Lincoln.
"Now tell me that this guy (and his employer) are not morons.... please?!?"
ReplyDeleteMatt - I have to agree with you that this author, Carole Emberton, (don't know about her employer), is a moron. No I take that back. I wouldn't say she is a moron because that term is so over used on this blog that it has lost its meaning for me. All seriousness aside, Jack Hunter is no moron. You may not agree with him politically, but putting that aside I think he makes a highly intelligent constitutional argument against the Affordable Care Act in the following Youtube video "Nullify Obamacare"... http://bit.ly/1gHKrWe.
That said, I believe Hunter massively overplayed his hand and acted stupidly when he wrote in his article "John Wilkes Booth Was Right"..... "Although Lincoln’s assassin, John Wilkes Booth's heart was in the right place, the Southern Avenger does regret that Lincoln's murder automatically turned him into a martyr.: http://bit.ly/1fetowg. He paid the price for that statement because Rand Paul fired him from his staff as a political liability. Jack Hunter is not the only one who has criticized President Lincoln for over stepping his constitutional authority and reasonable people can disagree on this matter. Personally, I think the Civil War was a catastrophe which could have been avoided. It would have been far cheaper in blood and treasure for the federal government to simply purchase the freedom of the slaves.
I assume you are referring to Rand Paul as Jack Hunter's employer? If so, note as I indicated above that Rand Paul is Jack Hunter's former employer and he is one of the handful of libertarians in Congress I was referring to who are so few in number that I can hardly see how they would constitute "....WAAAAAAY too many of these libertarian morons occupying/usurping our majesterial positions right now...". Rand Paul is only one man, but he does get a lot of headlines and he may become the next president. For the record, I am not as phobic about the debt and deficit as Rand Paul is but I agree with him about most other issues and he is no moron either.
Ed,
ReplyDelete" it has lost its meaning for me."
Let me help then.... it means "tasteless" or "insipid"... think of them as "lacking a key ingredient" of knowledge... WE have it, THEY dont....
Ed, these people are caught up in some really dark shit... suggest seek to spend less time over there... nothing good can come out of it...
rsp,
Matt - Is exhortation the best you can do? I can appreciate that it must pain you to fathom that I am an eclectic blend of Supply Side, libertarian, Marxist and MMT thinking but there it is. There are ideologies and believe systems from one end of the political/economic spectrum to the other and in my experience each and every one of them can be dangerous when they are embraced by the religious intensity of true believers.
ReplyDeleteEd,
ReplyDeleteOther than the few hard core ideological zealots out there, whether far left or far right, libertarian or liberal oriented authoritarian control freaks, most people are just like you, a complex mix of various sentiments. Scratch most so called libertarian and you'll generally get a rainbow of internal contradictions. Invoking libertarian as invective cleverness is straw man silliness.
Tom, Re the “tyranny of money”, who has done the tyrannising over the last couple of centuries: private banks or governments? Private banks have completely abused their money creation powers: they’ve given us NINJA mortgages, credit crunches, mass unemployment, etc.
ReplyDeleteThat's true, Ed, but why did this come about, First governments abused their power and the wealthy later became strong enough to wrest it away from them. That's how the BoE became private at the time of its inception. It was a reaction to the monarch's "profligacy."
ReplyDeleteWith politicians all saint, "We running out of money," we should trust them with exclusive money creation?
In an ideal society things would be different, but we don't have an ideal society yet, nor are we even close to one.
The first priority is ending the neoliberal mindset-worldview that has a strangle hold on governments, politics, and economies.
With neoliberalism in place, it doesn't really matter who creates the money anyway, since it will always be controlled by the rich and powerful.
The only way that giving the government the full money power can work is under enlightened participatory democracy and a correct understanding of political economics aka macro.
We are not there yet, so calling for governments to take over the full money power is premature, and I believe it would just be another nail in the coffin of democracy under existing arrangements.
Or a recipe for disaster in divisively divided government with debt and deficit hawks opposed by debt and deficit doves, and no one understanding how a monetary economy works.