On The Issue of Machine Value within a Marxist Theory of Capitalism
In the edited collection of the Cutting Edge “Why Machines Cannot Create Value; or, Marxist Theory of Machines,” (1997) C. George Caffentzis makes the claim that “futurological assumptions and political dystopias turned out to be radically wrong in their common assumptions” i.e. why a future utopia or a riotous lower class never develops (30). He bases his claim on the fact that “machines cannot create value.” Defining the word value to a specific meaning according to Marxist theory precedes the question of what happens when the surplus value created by computing becomes a dominant force within a capitalist society. I contend that capitalism adapts to the unrealized surplus values created by machines (software as well as hardware) in a coexistent manner within a robot economy until capitalism ceases to be a dominant force.
Caffentzis frames his “article [a]s a reanalysis and defense of Marx’s original claim that machines cannot produce value;” (31) “where value is human labor that is performed under capitalist production relations, that transforms use-values, and that must realize itself through exchange as money” (Carchedi 74). Caffentzis states that “[c]omputing . . . is just another aspect of human labor power [a value] that can be exploited to create surplus value,” (53) and goes on to say that “the Marxist reason why machines cannot create value [is] because they are values already” (54). In a similar manner, Carchedi claims implicit in Marxist theory is the notion that “only labor power can produce value” (73). It is the use-values of unrealized labor power in machines such as open source software, DIY projects, unprofitable YouTube videos, Steemit.com an open source platform similar to FaceBook and countless other freely exchangeable nonprofit informational systems, and even commodities like Bitcoin (open source software) which are designated as money in some jurisdictions, that imply something other than a capitalist future.
Take for example the software that UCSB and CSUN students and professors write for the What Every 1 Says program. Funded by the Andrew Carnegie Foundation, WE1S requests that the software be made available for download on GitHub. The software must be licensed by the Creative Commons Attribution-ShareAlike 4.0 International Public License. The copyright states:
1. Subject to the terms and conditions of this Public License,
the Licensor hereby grants You a worldwide, royalty-free,
. . . irrevocable license to: . . .
a. reproduce and Share the Licensed Material, in whole or
in part; and
b. produce, reproduce, and Share Adapted Material . . .
the Licensor hereby grants You a worldwide, royalty-free,
. . . irrevocable license to: . . .
a. reproduce and Share the Licensed Material, in whole or
in part; and
b. produce, reproduce, and Share Adapted Material . . .
The WE1S software posted to GitHub (WE1S) by members of the WE1S project as well as software licensed by others with similar licenses such as the MIT License (The MIT), and the GNU Public License (gnu.org) all operate outside the Marxist idea of value. Take for another example all the machine software that our hyper-historical world (Floridi 3) runs on, such as the open source software the Internet runs and computer, and device software operating systems, AI systems and so on. To a great extent our world runs on open source software.
The informational society we live in could not have been anticipated by Marx and neither is it included in his theory. According to Floridi “by fostering the development of ICTs, the state ends by undermining its own future as the only, or even the main, information agent” (172) And further, “the more physical goods and even money become information-dependent, the more the informational power exercised by multi-agent systems acquire a significant financial aspect” (176). The royalty-free portion of our informational infrastructure has only use-value and if it were to cease to exist so too would the ecosystem of our human society which is now dependent on it.
Michael Tiemann, former RedHat CTO and co-found Cygnus Solutions, the first company to provide commercial support for open source, writes about how Cygnus, Red Hat, and other open source software support companies function within the economic system (Tiemann). The article quotes Nobel Laureate Ronald Coase saying that ‘institutional arrangements determine to a large extent what is produced, [so,] what we have is a very incomplete [mainstream economic] theory’” (Tiemann). The economic theory that Coase refers to is one that has an economy [that can] be coordinated by a system of prices [alone]. Tiemann validates that this is not so through his creation of an open source software service company. Incidentally, Red Hat purchased Cygnus for $674 in a November 1999 transaction (Red Hat), and Red Hat was purchased by IBM for $34 billion dollars this month, which implies even more demand for open source software solutions and maintenance as open source integrates into the highest levels of a supposedly capitalist economy (CNBC). Open source software is even specified for use by the U.S. Department of Defense (Tiemann).
Due to the fact that hyper-historical economies depend less over time on human labor value where value must be realized through the transaction of money, the economy based on value described and argued by Caffentzis as being a system of values misses the point of machines producing value. And, although Caffentzis is correct that within Marxist theory machines do not create value because “only humans can create value” his article outside of a philosophical exercise in Marxist theory is only relatively important as to why machines can’t create value. Machines as open source informational software systems represent a large portion of the economic foundation that societies run on. The more machines produce products and services outside the scope of Marxist theory, the more society moves to a robot economy (What is a robot economy?).
Works Cited
Carchedi G., “High-Tech Hype: Promises and Realities of Technology in the
Twenty-First Century.”Cutting Edge: Technology, Information Capitalism and Social Revolution. Davis, Jim, et al., editors.First Edition edition, Verso, 1998.
Chaffentzis, George C., “Why Machines Cannot Create Value; or, Marxist Theory of Machines.”
Cutting Edge: Technology, Information Capitalism and Social Revolution. Davis, Jim, et al., editors. First Edition edition, Verso, 1998.
https://creativecommons.org/licenses/by-sa/4.0/. Accessed 23 Nov. 2018.
Gnu.Org. https://www.gnu.org/licenses/gpl-3.0.en.html. Accessed 23 Nov. 2018.
https://www.cnbc.com/2018/10/28/ibm-to-acquire-red-hat-in-deal-valued-at-34-billion.html. Accessed 23 Nov. 2018.
The MIT License | Open Source Initiative. https://opensource.org/licenses/MIT. Accessed 23
Nov. 2018.
Accessed 23 Nov. 2018.
“WE1S -- WhatEvery1Says.” GitHub, https://github.com/whatevery1says. Accessed 23 Nov.
2018.
https://searchenterpriseai.techtarget.com/definition/robot-economy. Accessed 23 Nov.
2018.
Implications of Caffentzis’s Claim
In the edited collection of Cutting Edge, (1997) C. George Cafentzis makes the claim that “futurological assumptions and political dystopias turned out to be radically wrong in their common assumptions” because “machines cannot create value” (30). His contribution to the Cutting Edge “Why Machines Cannot Create Value; or, Marxist Theory of Machines” misleads the reader by allowing the reader to signify complex, subjective and porous connotations of value with a single word. “Value” is a symbolically challenged word, its signification imbued with meaning by referents from economics to advertising and mathematics, etc. People intuitively sense that they know what it means but like God, nobody can pinpoint exactly what it is outside of the context within which it is framed. Caffentzis frames his “article [a]s a reanalysis and defense of Marx’s original claim that machines cannot produce value” (31); “where value is human labor that is performed under capitalist production relations, that transforms use-values, and that must realize itself through exchange as money” (Carchedi 74). Without ever mentioning other forms of economic systems, he critiques a model of a capitalist system as if it is the one in which his audience lives.
Caffentzis speaks about the capitalist production of value as defined within Marxist theory; a kind of closed system of equilibrium of capitalist production wherein “only labor power can produce value.” (Carchedi 73). In Marxist theory, value may be measured quantitatively (Carchedi 83). And, while this may be true when making a Marxist critique of capitalism, when haven’t the subversive forces of ever-changing financial systems continually rendered any specific value into a state of flux?
Value fluctuates by magnitudes and in different ways depending on the whether or not the calculation is made within a specific financial system and when calculated. The question of whether or not machines can produce value plays a subordinate role to what we mean when we speak of value. Take as a rough approximation of what I mean by looking at the following graph of GDP--the total value of goods produced and services provided in a country during one year.
GDP, as shown above, is dependent on credit growth within debt-based economies. In the graph above, the issuance of debt (the upper line) is shown to determine GDP (Salmon). According to Marx, The “capital-value of such paper is nevertheless wholly illusory.” It is “fictitious capital.” But within the debt-based economy of the U.S. since the Greenspan era, the credit cycle has replaced the business cycle of late capitalism. Debt now determines value and not human labor power. Within the centralized wealth structure of debt-based economies, the allocation of value may be assigned to those first in line to receive debt instruments--monetary sums--at lower interest rates than others. And, value in the form of debt provides students with funding to go to college, and so on. Value as debt functions slightly differently in other G20 nations but nonetheless, debt has replaced the value of money.
Rather than human labor power, debt allocation enables machines to create use value that in turn keeps the system running. One reason for this is that the use-value of the products produced must be exchanged on the market in a Marxist capitalist system “through the intermediation of money” (Carchedi 74). But in a debt-based economy, use-values are exchanged for the liabilities of the Federal Reserve Banks. Secondly, the machines provide the necessary software for the exchange of financialized instruments of debt that transfer wealth from one location of the world to another. In China, for example, the surpluses of human labor production have been redistributed to the West while the West relies on the use value of machine software to exchange those products for instruments of debt. And although a person that adheres to Marxist theory might claim that this is what Chaffentzis explains when he quotes that capitalists recognize “‘their profits are not derived solely from the labor employed in their own individual sphere’ and they are involved in the collective exploitation of the total working class,” (41) he fails to mention that the “capitalists” are well aware that they are buying back their companies stock with borrowed Federal Reserve notes as a means to increase their profits per share.
The elephant in the room of Caffetzis’s article is the western world’s central banking system that controls the motion of debt around the world and the fact that he fails to mention, outside of a Marxist capitalist system, monetary systems at all. Federal Reserve banking policy provides a type of financial system that allows the use of derivatives and all manner of financial instruments of the types Randy Martin alluded to in 2006 in his article “Where Did The Future Go?”; he indicates this when he says that capital was “reincarnated as a plethora of financial instruments” (Martin 2). According to Mike Maloney a guest of Chris Martenson during a Peak Prosperity interview, “every 30 to 40 years, the world had a brand-new monetary system, completely different from the last one. The classical gold standard before World War I, the interwar gold exchange standard and the Bretton Woods from 1944 to 1971, and now the global dollar standard” (ChrisMartensondotcom).
Caffentzis misleads his reader by failing to state that Marxist capitalism which he bases his article on is a historical financial model now superseded by centrally controlled models of fictitious capital which are that exact thing (third-order simulacra) Baudrillard tried to warn us about. The answer Caffentiz gives as to “Why Machines Can’t Create Value?” can only be answered by constraining meaning to Marxist theory. Thus, his article doesn’t answer the question of whether to not machines can create value independent of human labor power. Within debt-based economies and within special economic zones and inside and outside the scope of larger economies machines can and do create value.
Works Cited
Carchedi G., “High-Tech Hype: Promises and Realities of Technology in the
Twenty-First Century.”Cutting Edge: Technology, Information Capitalism and Social Revolution. Davis, Jim, et al., editors.First Edition edition, Verso, 1998.
Chaffentzis, George C., “Why Machines Cannot Create Value; or, Marxist Theory of Machines.”
Cutting Edge: Technology, Information Capitalism and Social Revolution. Davis, Jim, et al., editors. First Edition edition, Verso, 1998.
ChrisMartensondotcom. Mike Maloney: One Hell Of A Crisis. YouTube,
https://www.youtube.com/watch?v=sIbB5o2A9Qk&feature=youtu.be. Accessed 19 Nov. 2018.
RANDY MARTIN -- WHERE DID THE FUTURE GO? -- LOGOS 5.1 WINTER 2006.
http://www.logosjournal.com/issue_5.1/martin.htm. Accessed 19 Nov. 2018.
Salmon, Felix. “Chart of the Day: Growth and Debt.” Reuters Blogs, 16 Mar. 2012,
http://blogs.reuters.com/felix-salmon/2012/03/16/chart-of-the-day-growth-and-debt/.
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