AskProfWolff: Basic Marxian Economics: Challenges and Questions 

Proff Wolff ffor president...,no to leftish for the States but here in Finland he should make a very good chance,I like to listen to him!

Best we keep a strong critique of his "friend and supporter". Marx was a genius in terms of insight into the relationship between society and their material bases. However, this legacy has been compromised by the political vision that was attached to it at the behest of Engels. All of that garbage about revolution is really facile compared to Marx's more brilliant ideas (a special nod to Hegel, in the latter context)

Same here

​@Gabe. I know about Vaush and wish I didn't.

@Gabe. He's a liberal who wants you to throw your vote away on Biden, and he clearly hasn't read much theory. He gives leftists a bad name.

@@Andystuff800 you need to wake up. harm reduction and progress, even if marginal, is better under Biden. Instead of attacking Vaush (and other like Prof Wolff, David Pakman, Sam Seder, etc), you should understand why serious lefties promote voting democratic in these circumstances. Bernie lost, we must continue the struggle.

​ @Gabe. Trump is not a fascist. Biden will continue the same Obama policies that gave us Trump. Whoever comes after Biden will likely be an actual fascist. ​@@gwills9337 We don't continue the struggle by voting for our oppressors.

Then he should open his own business and minimize his risks.

@@johnemero You are suggesting a paradox. who would work for him there if not other workers that he is now unloading that risk on? Your advice only works if the average worker does not take it.

@@tidakada7357 The business owner has all the risks that are experienced by his employees plus the added risks that go with the loss of his business. If the employee feels that more money would reduce his life risks then he should add more value to his employable services. Where would your over burdened risk taking workers work if not in the service of an employer or as employers themselves?

@@johnemero On a farm feeding his family

@@johnemero As workers employed by themselves, aka worker co-ops.

I enjoy him in his economic explanations. When he goes on to promote BLM and racial divisiveness, he moves from Communistic ideals to racism. The fact that Judaism is a race-based religion, must be considered whenever a Jew gives his opinions.

@@daniel8728 come again? lol

Also considering work-place injuries and deaths, specifically the more vulnerable workers like those with disabilities, immigrants, and other protected statuses. They take a risk by getting a job that can illegally fire them because of who they are. I love the reframing of these arguments from a worker perspective. People are more valuable than what they can offer to a boss.

Criminal organizations are as abusive and exploitative a capitalist hierarchy as any. Usually it's not the people at the top controlling and seizing the products of other people's labor, the mob boss, head of a prostitution ring, cartel king that takes the most risk. The whole point of their position is to force disposable underlings to take the risk of arrest, violence, murder, long prison sentences by doing the actual crimes in ways that get them caught or hurt while keeping their own hands and record clean. While maximizing the profits from the labor of those below them who suffer the real risks, using not just the threat of denying them work and income, but horrible violence from their enforcers. Basically legal capitalism on steroids.

nailed it, comrade

Excelent comment and one of the best usernames ever. :D

I have noticed this in the automobile market. I can in canada buy a vehicle for around $1000 that will reliably fulfill the transportation requirements of a car. When I was travelling in poorer countries, almost all cheap cars are problematic. It is clear that people will not sell functional vehicles at a low price. It has more utility to them than the money that could be extracted by selling it.

Thank you

Okay, but the machines and factory were produced by labor that was paid, and have yet to produce anything, so all it takes to throw wrench into your calculation, is for the owner of the factory to have also produced the machines and the factory. Now what??????

@@jgalt308 marx differentiates between workers and capitalists that's how he uses the labor theory of value to explain his theory of exploitation, ofc this differentiation isn't always true, sometimes capitalists are themselves workers. At that point this reasoning doesn't work. Even in this case there is still a problem with the amout of power that the capitalist has within his business and thus he can still extract surplus value that is more than his fair compensation as a worker.

@@destroctiveblade843 Okay, here is an example posted elsewhere here which illustrates the scenario you have offered for the factory owner...but changes the item produced...and the numbers here are accurate and can be verified. --------------------------------------------------------------------------------------------------------------------------------------------------------------- There is nothing abnormal about the profit..the publisher of Wolff's books is known, as are the costs. ( and yes you actually have to look to verify this and you can also research other "publishing" options, there were available to him and learn that he could have produced the book for 60% less than he is currently paying, which is the $7 to $8 range. ( shipping, handling and taxes are extra and go to the publisher ) and you should have no problem finding the current price of each of the two books available...approx $25 and $30 respectively. Now you haven't really answered the question, but we will make it easier for you by making the publisher a co-op which agrees to work for free... while Wolff invests time, paper and a typewriter, or uses a computer to write the book. Now the co-ops cost in total are $7.50. and this includes the "profit" they were willing to settle for in the actual agreement. ( but we are now calculating the division of profits based on your claim ) And these profits are 233% on the $25 item and 300% on the $30. item... So the question again is, how much of the extra profit that is represented by Wolff's share, should go to the publishing co-op that is "sharing the risk "? ( and if Wolff were a better capitalist he could have cut the costs to around $3 and taken delivery of them, hiring people to take care of the shipping and handling which is an extra charge over and above the cost of the book. ) Now you can determine how much of the 7.50 cost is actually profit for the publishing company at any number you like.....but let's work with 2.50.... Wolff's costs are reduced to that of the computer whose cost is relatively cheap to do the job required and the cost of his labor which he only has to do ONCE..... So the profit is $20 and $25 respectively less the cost of the computer and Wolff's labor.....since we know the actual production costs for the book are $5 for everything except labor....so the labor (profit) contribution is $2.50 per book......Which leaves 17.50 and 22.50 less Wolff's costs, as the profit to be divided.... Also, once Wolff recovers the value of his computer and his time.....he contributes nothing further, while for every book, publishing labor is still contributing $2.50 of profit to the profit pool....per book.....so according to your claim, if labor is responsible for 100% of the profits, and Wolff is no longer contributing any labor.....and has already been compensated for what he has contributed, why should he receive any of the profits????? -------------------------------------------------------------------------------------------------------------------------------------------------------------------- In addition to the above, there are further problems with this line of reasoning, the first one being that THIS ( our currently reality ) is NOT "capitalism" in any sense of the word....whose proper definition is: The private ownership of the means of production whereby one is entitled to the fruits of one's own labor. And here all labor is capitalistic whose value is determined by whatever the market will bear, determined by supply and demand and the law of diminishing returns...and it doesn't matter how much you attempt to alter the definitions ( as Wolff does ) it doesn't change this fundamental relationship. There are more points covered in the "original thread" which you should be able to find easily enough, given the biohazard symbol, so I won't bother you with them here....

@@destroctiveblade843 Managers are workers who provide crucial organization & coordination. Owners provide capital (plant / property / equipment). Workers get tired working 8-hour days...but so do managers running around the offices, and so does capital equipment which also "depreciates" similarly. Workers, Managers & Owners all contribute to the enterprise, and so they all deserve compensation from the total revenues earned by the company as a whole. All three of those interest groups would prefer "more" but it's not fair to preference one over the others. Imagine all the workers show up... but their are no managers, no owners & no capital. The workers show up to an empty barren field. How much can they produce? The next day, only the managers arrive at the empty field. With no workers or owners, what can they accomplish all by themselves? The next day, the factory is built, capital equipment installed, utilities connected & transportation erected... but neither workers nor managers arrive. How much work does the empty factory (and a few shareholders) accomplish? In military terms, you would never enlist in an army that was all soldiers (=workers) with no officers (=managers) or tanks & cannons (=capital). Somebody has to fight (=work), somebody else has to study Hannibal & Napoleon (=manage), and none of it does any good without weapons (=capital). If you claim that all defense spending (=revenues) should be paid to soldiers (=workers), then you are a Tsarist army Imperialist, spending all your money hiring Russian peasant soldiers (=workers) without giving them any weapons (=capital) and sending them into battle (=economy) utterly unprepared. You cannot claim Russian soldiers having (comparably) no weapons was good for them, nor can you claim that the effective economic "nuking" of Detroit Industry was good for the US economy. Only the combination of Capital & Labor coordinated by Management can be effective, as you yourself know is obvious once translated into military terms (Weapons & Soldiers coordinated by Officers). Since you know you will never see an army run differently, why expect to see businesses trying otherwise? A "Labor Theory of Value" (not "Prices") could be useful with extension to include Capital (depreciation) and Management (salaries) -- "Labor + Capital + Management Theory of Value" to society at large (including say externalities) when compared to the market-valuated Prices of those same inputs, would potentially be valuable knowledge.

​@@jgalt308Whether you realise it or not (no disrespect, I just can't tell from one comment), this speaks to the TRUE insight of Marxism: firstly, social relations and structures are an outcome of material conditions; and secondly, this is a symbiotic process that produces value through the exploitation of labour. Value cannot be generated in the absence of that process, as we are seeing today with the gradual implosion of our economy due to the "invention" of value in the financialised mega-markets. Revolutionary teleology was just a fantasy that Marx indulged because his friend Engels fancied himself as some kind of philanthropic visionary. Shame the likes of Lenin took it and turned it into a blunt instrument of authoritarianism

THE QUESTION of the moment!! The habituation of fear around the subject destroys any opportunity for true reciprocal dialogue & discussion

I noticed in many of Wolff's videos that he often describes Socialism or Marxism without using the specific terminology. It helped me get over my fear of the subject which really allowed me to see how instilled the fear is in western culture

Money is commodity, so of course it has value. Money is the commodity with which all other commodities measure their value. For example, let's say that the value of one bicycle is 600$. If the money-commodity is gold and 600$ is just the name of 10 gram of gold, then when we say "The value of bicycle is 600$" that means: "There is equal amount of labor (socially necessary) "frozen" in the material body of bicycle and in 10 grams of gold".

It is most correct to say: "The value of a bicycle is equal to the value of 600$" and not "The value of a bicycle is 600$"

@Brian Abisdid Unless people invest collectively as owners-employees.

@Brian Abisdid Risk is a factor for any business, but cooperatives can get start up loans like anyone else. And pooling small amounts from a groups can be enough for a small business. But structural reform could really help, like right of first refusal or low interest loans or grants.

Сapital itself is a growing mass of labor, constantly circulating in the form of goods, so if it is not constantly fed with fresh blood in the form of labor, it ceases to grow and accordingly ceases to be capital.

gil-nam Moon lol

Looks like a well worn study

When everyone owns everything that's where you end up living.

(Edited) Quality of life has little to do with ownership. Somebody who rents a flat can be happier than the man who owns a mansion.

I think every professor does 😂 I used to work in a University, most of the older ones have that same vibe going on.

So the employer takes a loss and the employee collects unemployment compensation.

Dr. Howard Baetjer is also an economist. I'm not defending his arguments, but I just wanted to point it out that he is a professional in the field of economics too. However, he doesn't know much about Marxism.

Use value is how much value you get by using a commodity. This is subjective because different people value things differently. For example, I love eating pasta but my dad doesn't. Hence, I get more value from eating pasta than my dad does. Exchange value is the relative value of two commodities that are exchanged. This is objective because it's based on the amount of each commodity exchanged. For example, if I trade 2 apples for 3 bananas then each apple is worth 1.5 bananas. Now, both time and money are commodities. In the $20 wage example, the worker agrees to exchange one hour of his time for $20 in money. Thus, the exchange value of one hour of the worker's time is $20. The worker then spends one hour of his time producing a commodity for the employer. Thus, one hour of the worker's time is transformed into a new commodity. The employer then sells this commodity for $22. Thus, the exchange value of the commodity is $22. Hence, the exchange value of one hour of the worker's time is $20. However, the exchange value of the commodity produced by the worker in that one hour is $22. The employer pockets the surplus $2 per hour as profit. Thus, the employer is exploiting the worker because the worker produces more (exchange) value in one hour than what the employer gives the worker in (exchange) value for one hour of his work. Now, Dr. Howard Baetjer makes the mistake of confusing use value and exchange value in his criticism of Professor Wolff. According to Dr. Baetjer, the employer is not exploiting the worker because the employer and the worker value the one hour of the worker's time differently. The employer values one hour of the worker's time more than he values $20. However, the worker values the $20 more than he values one hour of his time. Thus, according to Dr. Baetjer neither the employee nor the worker are exploiting each other. Of course, the argument presented by Dr. Baetjer is wrong because he is thinking in terms of use value and not exchange value. The worker can value the $20 more than he values one hour of his time, and still be exploited by the employer. This is because the worker still produces more in (exchange) value in one hour than what the employer gives the worker in (exchange) value for one hour of his work. Note that this is fact is irrespective of how much the worker or the employer values one hour the worker's time.

Thank you for doing all this research.

@@aaditshah4689 You are welcome, a rare "thank you" from the EGOTISM-filled human population. HOMO SAPIENS [SAPIENS] SPECIATED-OUT ~50Kya **IN DENIAL** AND IT IS THAT DENIAL WHICH IS NOT ONLY THE BEDROCK OF ITS DNA BUT WHICH ALSO WILL DRIVE IT TO ITS EXTINCTION THIS CENTURY, 2115AD AT THE LATEST.

Worker ownership of their work is the only way to install and cement democracy.

Dr. Howard Baetjer is a professor with a Ph.D. in economics, just like Dr. Wolff. However, he's not a Marxist. Here's his original article. fee.org/articles/debunking-marxism-101-why-your-boss-isnt-ripping-you-off/

@@aaditshah4689 ah.

I don't really understand where you're going, what question are you asking?

The business owners themselves don't actually have to do all or indeed any of the planning / leadership. They often do take up those roles, but not always. The amount of the profits invested back into the business is also varied, and how often is that profit invested back into the workers? Not very often.

Of course he has to do the planning. If you decide to open a restaurant, you better know what type of cuisine you are going to sell, and who to hire for the job. Part of the profit will pay your debts, unless your father is rich, an other part will be used to buy bigger or newer ovens, an other part will be spent on educating the staff about hygiene, or buy more chairs, or change the interior design of the restaurant, etc...Assuming that the business owner should spend all company's profit on the workers, is no short from a mythical kindergarden where all the costs are paid by the church or Santa Claus. ps: A professor in America is the most overpaid professor on the planet. The guy in the video sounds like a cigar smoker telling people to stop smoking cigarettes.

@@wilsonkorisawa7026 I mean, they literally don't have to do the planning. They have to provide the capital, they can very easily employ someone to do the planning. You're also acting like businesses always put their profits back into the business and the fact is they don't. Also, if you're a cigar smoker, it doesn't mean you're wrong when you say it's unhealthy to smoke cigars. It's clearly unhealthy. What you've done there is called the fallacy of hypocrisy.

@@maximthefox None of your arguments makes sense, you are just playing with words and dancing around the bush. Ask any business owner if he had to do the planning before he opened his business, and he will tell you a BIG "Yes". A business plan is done before a single brick is bought. Anyhow, from the way you dodge the arguments tells that you have never studied economics nor business, and probably you never owned a business either. You are just ideology driven. Defending an American cigar smoker and making him a champion of an anti-cigarette campaign is the biggest fuckery I have heard for a long time, and that speaks volume about how corrupt your intellect is.

@@wilsonkorisawa7026 you're trying to pretend to me right now that you've studied economics and or business??

Their schizophrenic misinterpretation of the parable of ten minas is the perfect sign of the monstrous inversion. Jesus talks about a usurer running an extortion racket and then butchering his opponents in a vendetta, and they immediately recognize that figure as their god. The irony is real.

Yea, its not a black or white issue. Its a spectrum. There is also the question of voluntary contract. Also, if its a partnership its not really exploitation. Im sure the high paid management workers arent complaining about exploitation. The real problem is the unequal ownership of the means of production, and unjust income inequality.

I read the thing and it's the most post-modern mindfudge (in the bad sense) I've read in a long time. According to him, people with different interests (worker, capitalist) actually live in separate universes with no material intersection (not just figuratively like"the rich live in a different world"), and this way both can benefit from the same "contract" despite the obvious fact that the employer ends up much richer than all his employees put together.

Rational thought is not the forte of the Marxist philosophy. Capitalism at it's core is voluntary exchange with minimal government intervention and Marxism is some people telling other people what to do by the coercive power of government. Unless you're talking about being a libertarian Marxist. Spoiler alert they are not libertarian Marxists.

@@msp5138 Observed reality is at odds by your conclusions. Why is it that the more you have collective ownership and centralized control the more people migrate and vote with their feet to places of greater freedom which includes systems of private property protection. Remember, protection is not violence. Capitalism does not initiate force. See en.wikipedia.org/wiki/Tragedy_of_the_commons I agree with you that most forms of governments are bad in your latter remarks. You want to minimize government.

@@msp5138 Capitalism by itself is not enough, correct. However, I know of no system that has high degrees of freedom and prosperity that doesn't use capital. Capital is a necessary condition but not a sufficient condition. And, past aggressions exist and fortunately those aggressions are constantly being revisited and evaluated and forms of compensation are constantly being debated. That's a good thing. That means we as a society realize that those forms of aggressions were done not with persuasion but with violence. Which is everything a free society should be against. Keep in mind the human species is a violent species. But, violence does not breed prosperity - which is why the founding fathers gave the government a monopoly. Government is unfortunately necessary, but only as a monopoly to repel violence and aggression. Do keep in mind, that of course at the end of the day, might makes right which is why as the government keeps us in check we have to keep the government in check.

@@msp5138 this comment is 100% spot on. There has never been any such thing as a free-market. Capitalism cannot be understood in a historical vacuum either. When you're trying to understand capitalism you have to realize that you are heavily influenced by cultural biases which are profoundly ideological, and shape your perception of what you deem to be "fair". For example, are you factoring in inherited wealth (Weber), educational inequalities, access to Capital, systemic racism and class power and oppression? The bottom line is, whether a worker enters into a labor agreement freely or not, surplus value is always extracted in the form of profit, which is inherently exploitative. It's true that Marxists argue for fairer wages, and regulations to prevent the abuses of capital, but truly what they argue for is collective ownership of the means of production, which means production is carried out for the common good of all, not the private profit of the individual. When the social contract between labor and capital breaks down you have a crisis in capitalism.

That’s a good point! Although, I think we also need to consider the fact that large corporations tend to have hundreds of thousands of employees. Even if the profits are split 50/50, corporate officers and shareholders still make massive amounts of money. In the case of smaller companies, they’d have a harder time splitting profits, but if you invest 20 years of your time and energy into building something it shouldn’t be because you expect it to make you rich. That’s one of the inherit negatives of capitalism - the motivation of huge profits, usually leading to the exploitation of resources and people. However, I understand that small business owners should be rewarded for their efforts. And they will be, assuming their product or service is in demand. Their company should grow (assuming they make wise decisions), despite splitting profits with employees. That’s just my personal opinion.

I think you're right that it is real work to setup and run a business, however, I think it's worth pointing out that the person setting up and running a business is not necessarily the owner. So you could imagine a business that is managed by a worker and ran by other workers and the profits go to an owner, the capitalist. In this example the capitalist doesn't do any work they just make money from their investment. You could argue that they did work to get the money in the first place, however that is not necessarily true because that money could have been inherited, gotten from other investments, through chance, stolen, etc. In reality most people with money are both workers and capitalists. They do some real work but, if they're rich, they get most of their money from owning things. This is potentially problematic for many reason: 1. Money can be past down from generation to generation so vast fortunes can accumulate over time, this means that you can be born into a rich family and never have to work a day in your life. This should be seen as unfair because you're getting a vast sum of money without contributing to society. 2. Nobody would invest in something unless they expect to get more than they put in. This means growth(think of the exponential growth of the stock market), this is potentially unstable and could easily destroy the planet, for instance growth in the fossil fuel industry increases CO2 emission causing global warming. Growth in the plastics industry has polluted the oceans with micro plastics and filled dumps with plastic waste. Most industries, if they get too big, cause problems for the environment. I could go on but this is already getting long. I hope this helps you understand some of the problems with capitalism.

The employer should simply get a real job

He never assumed that. Don't build a straw man. What Professor Wolff said at 9:58 is that IF the employer is rich, as most capitalists are, then he wouldn't put all his eggs into one basket. Instead, he would take a manageable limited risk. As you can see, that limited risk depends upon the capitalist being rich and not being stupid. You can very well have a capitalistic who uses his entire life's savings to start a local business. Professor Wolff never said that workers ALWAYS take greater risk. He just said that USUALLY the risks that workers take are life changing risks whereas USUALLY the risks that employers take are limited risks.

I think the point was that the employer most likely loses some money while the worker most likely loses his ability to feed, shelter and cloth himself. Yet, unlike the employer he/she has no say in the operations of the company.

Dinner with Franklin. not to mention the employers decision can affect much of an entire community and all that that implies.

As others have already written, the risk involved on the part of workers vs owners is a matter of _scale_ . There's never zero risk on either's part, but there usually is a stark difference in each party's ability to absorb the consequences of failure.