Commodity Fetishism and Reification - Mike Rooke

Tokyo Stock Exchange

A clearly written essay on Lukacs, Marx and philosophy, the commodity form, Marxism(s), market 'socialism', the critique of political economy versus 'Marxist' economics etc...

"Mike Rooke has a background as a political activist and teaches at Ruskin College, Oxford."

From; Common Sense No. 23, 1998.

Commodity Fetishism & Reification
Mike Rooke


In a sense the origins of this article go back to the early 70s, as a member of the International Socialists (later SWP), my conception of Marxism took shape. My early identification with working class self-activity, inclined me towards the politics of the Workers Opposition in the Bolshevik Party rather than those of Trotsky. While my anarcho-syndicalist sympathies could be accommodated in the loose framework of the IS group, in the years leading up to the formation of the SWP in 1975, I came to see that the corollary of their tailing of workers militancy was a political opportunism held in place by a leadership clique around Tony Cliff. I became a member of the oppositional Left Fraction and was expelled with them in 1975, working for a short time afterwards with what became the Workers Power Group. The analysis made of the IS-SWP was that it was a centrist grouping, vacillating between reformist and revolutionary positions, and unable to consistently express the political independence of the working class. The subsequent development of the SWP has only confirmed this view.

The 'philosophical' underpinnings of my Marxism throughout these years remained relatively eclectic and unworked. This reflected the status which 'philosophical' questions have always had on the 'revolutionary' left, long settled positions already present in the accepted canon of Marxist 'greats' (Engels, Luxembourg, Lenin, etc.). Accepting this view of theory as largely completed, I spent much of the 80s exploring what kind of programme was needed to express the political independence of the working class, and concluded that the mass partyism of much of the revolutionary left had to be rejected in favour of propaganda groups which could return to an examination of the fundamentals of the Marxist tradition. My view of Marxism remained however that of Marxism as epistemology, a method which could produce truly scientific knowledge of the world. This was consistent with a mechanical and dualistic view of the relation between party and class, theory and practice, an approach developed during my years as an activist.

Re-appraising my view of Marxism was fairly haphazard and unplanned. It began with a discarding of much of the dross produced by the academic domestication of Marxism in the post-war period, and seeing Marxism as a critique of political economy, of the commodity status of labour and the value form. This led to a clearer understanding of communism as the de-commodification of labour, as the end of eworki, a unifying theme of Marx's work from the 1844 Paris Manuscripts to the Capital of the 1860s. This further prompted a consideration of Marx's definitive break with the philosophical dualism of 18th century 'contemplative materialism' as the fundamental basis of all his subsequent work. The idea gradually took shape that it was the failure to fully appreciate and absorb the lessons of this philosophical revolution which accounted for the persisting dualisms of the mainstream Marxist tradition: those of theory and practise, party and class, and its tendency to present itself as above all else a scientific epistemology. My understanding of Marxism was beginning to change and cohere around the notion of Marxism as a form of ontology, and the concept of commodity fetishism. This article was a first venture in expressing this.

Commodity Fetishism and Reification

It is no accident that Marx should have begun with an analysis of commodities when, in the two great works of his mature period, he set out to portray capitalist society in its totality and to lay bare its fundamental nature. For at this stage in the history of mankind there is no problem that does not ultimately lead back to that question and there is no solution that could not be found in the solution to the riddle of commodity-structure.

Thus Georg Lukacs begins the chapter in History and Class-Consciousness entitled 'Reification and the Consciousness of the Proletariat' (1). Following Marx's analysis in the first chapter of Capital, and in particular the section entitled ' The Mystery of the Fetishistic Character of Commodities', he identifies the essence of the commodity structure of capitalism as its tendency to make the social relations between people appear as relations between things, possessed of an autonomous power and objectivity. This commodity fetishism is, he claims, both an objective form and a subjective stance corresponding to it, by which he means that it is no mere illusion, but rather the actual lived experience of people in capitalist society. But this lived experience is one that conceals from people the true nature of their relations with each other. In the opening chapter of volume 1 of Capital, Marx states that under capitalism the product of labour is enigmatic because it assumes the commodity form. One of the most important features of this form is that the interdependent relations between the producers,
that is to say the social character of their labour, is expressed only through the relations between the products. Marx puts it thus:

The sum total of the labour of all these private individuals and private groups makes up the aggregate of social labour. Inasmuch as the producers do not come into social contact until they exchange their labour products, the specifically social character of their individual labour does not manifest itself until exchange takes place. In other words, the labour of individuals becomes an effective part of the aggregate of social labour solely in virtue of the relations which the process of exchange establishes between the labour products and consequently between the producers. That is why the social relations connecting the labour of one private individual (or group) with the labour of another, seem to the producers, not direct social relations between individuals at work, but what they really are: material relations between persons and social relations between things. (2)

The first part of Lukacs' chapter consists in a bringing together of the various comments made by Marx on commodity fetishism. In doing so Lukacs develops points crucial for his conception of Marxism. The effects of commodity fetishism are not confined to the sphere of production, but permeate every sphere of social life. Commodity exchange is for Lukacs a universal structuring principle of capitalist society. In pre-capitalist societies the personal nature of economic relations could be understood relatively clearly, since commodity exchange was not the sole regulator of production. Only when this stage was reached and the commodity had become the universal category of society as a whole, did reification assume decisive importance 'both for the objective evolution of society and for the stance adopted by man towards it' (p.86 of Lukacs). The structure of reification develops in parallel with the development of capitalist commodity production, and reaches its most finished form when capitalism has displaced all other modes of production:

Just as the capitalist system continuously produces and reproduces itself economically on higher levels, the structure of reification progressively sinks more deeply, more fatefully and more definitively into the consciousness of man. (3)

This is the stage when, for the first time in history, society is subject to a 'unified economic process', expressing itself in the existence of unified laws of development. Lukacs talks of a 'veil' of reification, which prevents individuals in capitalist society from grasping their actual relations of production, how commodity relations subjugate human consciousness into reified forms. These reified forms constitute a 'second nature'; a mode of thinking which is disastrous for the understanding of how capitalism really works.

Lukacs illustrates the effects of reification with the category of interest-bearing capital (or money generating money). In this case the social relation which generates value (the capitalist who buys labour power and puts it to work extracts surplus value and thus augments the value of his capital) is obscured by the relation of money to itself. The actual transformation of money into capital becomes invisible, a form without content. Marx says that in this reified form of thinking, money acquires the property of generating value and yielding interest - we arrive at a fetish form of capital. The reified category of 'capital-interest or 'capital-profit' is complemented by those of 'land-ground rent' and 'labour-wages', the economic trinity of political economy as Marx calls them. Lukacs refers to Volume 3 of Capital, where Marx establishes the significance of this:

It is the capacity of money, or of a commodity, to expand its own value independently of reproduction - which is a mystification of capital in its most flagrant form. For vulgar political economy, which seeks to represent capital as an independent source of value, of valuee creation, this form is naturally a veritable find, a form in which the source of profit is no longer discernible, and in which the result of the capitalist process of production - divorced from this process - acquires an independent existence. (4)

For Lukacs the notion of capital as an independent source of value is a phenomenon produced by reification, that is to say conceived apart from the social relations of production by which it could properly be understood. In such categories Lukacs points out that:

the relations between men that lie hidden in the immediate commodity relation, as well as the relations between men and the objects that should really gratify their needs, have faded to the point where they can neither be recognised nor even perceived. For that reason the reified mind has come to regard them as true representatives of his societal existence.(5)

But reification is, he stresses, only the product of a society whose essence is the satisfaction of all its needs by commodity exchange. Consequently, reification becomes a generalised feature of bourgeois thought. This effect is so pervasive and deep going that even thinkers who accept the existence of reification in social thought, fail to get beyond 'its objectively most derivative forms, the forms furthest from the real life-process of capitalism.' (6)

1923 saw the publication not only of Lukacs' History and Class ­Consciousness, but also of I.I.Rubin's Essays on Marx's Theory of Value. (7) The opening chapter of Rubin's book deals exclusively with Marx's Commodity Fetishism & Reification theory of fetishism, arguing that it forms the foundation of Marx's account of capitalist economy, in particular his theory of value. Rubin declares:

The theory of commodity fetishism is transformed into a general theory of production relations of the commodity economy, into a propadeutic to political economy. (8)

He emphasises that such a political economy does not analyse the 'material-technical aspect' of the capitalist mode of production, but is on the contrary concerned with its 'social form', the value form generated by capitalist relations of production:

Political economy is not a science of the relation of things to things, as was thought by vulgar economists, nor of the relations of people to things, as was asserted by the theory of marginal utility, but of the relations of people to people in the process of production. (9)

Rubin emphasises that those whom he calls 'vulgar economists' (the representatives of political economy after Ricardo), employ categories such as value, money and capital, which are considered not as expressions of human relations 'tied' to things, but as the actual characteristics of the things themselves. They come to focus exclusively on, and study, the 'natural-technical' characteristics of these things, believing that it is in the analysis of the movement of these that the true science of economics resides. It is the reification of production relations therefore which considers the social characteristics of things as natural characteristics belonging to the things themselves. 'Vulgar economy' remains imprisoned within the reified conceptual limits of capitalism. Insofar as it only considers the quantitative relations between fetishised categories it can neither arrive at a real understanding of the mechanism of capitalist production, nor provide a prescription for its transformation.

The social character of labour under capitalism (i.e., the interconnected society-wide division of labour) is only apparent by virtue of the value relations possessed by the products of that labour, and this is effected through market exchange. The role of `vulgar economy' is to provide a systematic rationalisation of this fetishised realm of market appearances, where social relations of production (the relation of capitalist to worker) are transmuted into the natural properties of things (capital and labour).

The focus of 'vulgar economy' on the fetishised exchange relations of the market conceals not only the inequality existing between employer and worker prior to any market transaction, but also the crucial process of surplus value extraction which takes place during the time when labour power is consumed by the employer. 'Bourgeois economics' is apologetic in the sense of justifying the existing property relations by removing them from the frame of analysis, and failing to grasp the underlying mechanisms of value creation.

But it is not that orthodox economics deliberately sets out to mystify or to conceal. The economic categories of demand and supply, prices, wages, capital, interest and profit are the immediately apprehendable facts of everyday economic life - they constitute the spontaneous, lived experience of economic life under capitalism. Since it is the market, which establishes the social character of labour, it follows logically that the categories arising spontaneously in the market provide the conceptual means for making sense of it. But the reality thus apprehended at this level is 'mystificatory'.

Both Lukacs and Rubin are distinguished by the fact that they consider commodity fetishism to be the very foundation of Marx's critique of political economy, and by that token, of Marxism itself. This is in contrast to the accounts given by orthodox social science, which treat it as at worst a sociological curiosity, and at best a valuable part of Marx's description of capitalism, but one which remains peripheral to his main theme. We have seen how in both Lukacs and Rubin, but particularly the former, the terms commodity fetishism and reification tend to be used interchangeably. To the extent that there is a distinction to be made, reification may be taken to designate the fetishistic character of bourgeois social thought in general, expressed more widely than just the sphere of market exchange. But in essence the effect is the same - instead of regarding the categories of bourgeois political economy as, what they are, the reified abstractions of real, and therefore transitory social relations, they are taken to be the embodiment of reality, an accurate representation of the way things really are. Such reified categories are discreet and unhistorical, possessing explanatory power for the way things appear under capitalism precisely because the properties of social relations appear as the properties of 'things'.

Commodity fetishism was seen by both Lukacs and Rubin as the centre-piece of Marxism. Their view however never made significant inroads into the mainstream of Marxist thought, which was at the time of their writing, crystallising into an orthodoxy. The philosophical core of Marxism after Marx had been established principally by Engels and Kautsky, and it was this core that was further ossified in the 'Diamat' of the Third International under Stalin. Philosophically, this mainstream was overwhelmingly epistemological and positivist in character. The two terms are used here to designate in the broadest and most general sense the dominant trend in modern philosophy and social theory.

By epistemological is meant a concern with the conditions and possibilities of knowledge, a focus that can be traced back to Cartesian rationalism. Its starting point is a subject-object dualism, whereby the human subject confronts a world external to it, and attempts to gain knowledge of it. The most important problem thrown up in this paradigm is that of the objectivity of knowledge. By positivism is meant the application of the methodology of the natural sciences to the study of social phenomena. It is an approach which privileges the empirical given, the raw sense-data of reality (which it refers to as the 'facts'), regarding these as more or less readily intelligible to the neutral observer. Both terms signal objectives and problems which revolve around the questions of how the individual human subject can gain knowledge of the external world, and what the status of such knowledge is. The terms are used here almost interchangeably, since the rationalist and empiricist strands in modern philosophy reflect a common preoccupation with the status of scientific knowledge. Positivist social science is anyway the logical (and historical) result of the epistemological focus assumed by a modern philosophy influenced by the growing hegemony of natural science.

In contrast to this tradition of positivist Marxism the concepts of commodity fetishism and reification provide the points of reference for Marxism as ontology. Ontology not in the speculative metaphysical sense of a philosophical system built around categories of being in general, but of a materialist, social ontology, grounded in the dialectic of social labour. Within the tradition of positivist Marxism these concepts have been read in an epistemological fashion, almost as illustrative examples of false consciousness in the debate over ideology, rather than as the specific result of Marx's analysis of the labour process of capitalism. The importance of Lukacs' History and Class Consciousness lies in the centrality that the concept of reification has in his exposition of Marxism. In Lukacs' Ontology of Social Being (the work of the last years of his life, from the mid-60s to 1971) he drew out the philosophical implications of this focus more deliberately and more explicitly, and in this sense produced an invaluable reference point for any critique of the orthodox tradition.

Subject and Object in Philosophy

"Truth is not to treat objects as alien"- Hegel.

Throughout the history of modern social science one theme has preoccupied its practitioners more than any other - the question of objectivity. This has been the coordinate around which the debates in the social sciences have remained steadfastly fixed, and it remains so even in the wake of the recent postmodernist turn. The spectre of relativism is merely another angle of this concern with objectivity. Can social science know the world through the murky lens of the human subject by employing the methods of natural science? Positivism emphatically says Yes! Relativism says No!, and in doing so tries to reformulate the question. But the original question still remains the over-riding concern of the mainstream in social science, and where this way of posing the question is avoided by those influenced by antiempiricist social theory, it is still the question that deep down animates methodological debates.

Positivism in the social sciences was built on subject-object dualism, a product of modern philosophy which began with Descartes. The thinking subject confronts the objective world in order to know it. In all the variations of positivism such dualism conceives of the subject as possessing a passive, contemplative relationship to the external world (the object). It is not a relation whose chief defining feature is practical activity. It is rather a relation of one-way knowledge appropriation, from object to subject, in which transformation of the object plays no part. Marx brilliantly anticipated this in the first of his Theses on Feuerbach written in the early 1840s:

The chief defect of all materialism up to now (including Feuerbach's) is that the object, reality, what we apprehend through our senses, is understood only in the form of the object or contemplation; but not as sensuous human activity, as practice; not subjectively. Hence in opposition to materialism the active side was developed abstractly by idealism - which of course does not know real sensuous activity as such.... (10)

Such dualism reflects a reification of' 'objective' reality, which assumes a separateness and autonomy from social actors, and can therefore only be known in abstraction from them. Arising logically from this separation is a parallel separation, the dualism of theory and practice. Theory in positivist social science is a closed epistemological realm, related to practice only by a process of abstraction. The subject is recognised of course to be ultimately part of social reality, but to be able to know it (objectively, that is to say without normative distortion), must be abstracted from it. This is the declared task of positivist social science. Practice, insofar as this category is given recognition, is seen as the application of principles discovered in the realm of theory, to the object social reality. But this separation of theory and practice, itself flowing from the separation of subject and object, sunders the unity of social existence. Reification of the social world is thus inscribed in the method of positivist social science at its most fundamental level.

Once the social world is objectified in this way it is closed off from social practice. Theory (theorisation) is not regarded as an aspect of social practice, a means of transforming social reality, but merely a technique of reflecting it as 'accurately' as possible. And the greater the detachment achieved by the subject (as bearer, producer of theory) the more accurate (i.e., objective) the reflection is. (Orthodox economics exemplifies this approach more obsessively than any other social science, having remained relatively immune from the incursions of anti-positivist thinking). Thus the passivity of the subject, and its separation from the social object, testifies to reification at the most general theoretical level. It has determined the preoccupation of bourgeois social theory with the question of objectivity from the beginning. Its history has been marked by alternating optimism and pessimism concerning the possibility of social knowledge. In periods of progress and advance, positivist thinking sweeps all before it, but lapses into relativist self-doubt in times of stagnation and crisis.

The strict separation of subject and object, and of theory and practice, is ultimately the product of a mode of production whose reproduction is secured, as Marx puts it, 'behind the backs of the actors'. Capitalism made social science possible insofar as the economic assumed an autonomy from the social actors, and could be abstracted from the lives of individuals and thus theorised. The very way in which capitalism reproduces itself gave to social science its reified form.

If the structure of bourgeois social thought is reified, it should hardly be surprising if we find in the Marxist tradition the presence of reified categories and method. Marxism after Marx was of course always unfinished, although this was not always the view of many of its representatives. It was at any one time always the outcome of intellectual struggle against the ruling ideology, and of disputes within Marxism itself. But in keeping with the prevailing hegemony of positivist social thought over the last two hundred years or so, the dominant current of Marxism has also been a positivist one. This has manifested itself at a general philosophical level in a preoccupation with the construction of Marxism as a science, and flowing from this concern with scientific status, has come the emphasis on epistemology as the most important way of expressing that scientificity. Such positivist strains are to be found in the work of Engels after Marx's death, in the orthodox mainstream of German Social Democracy, and in what came to be the dialectical materialism of the Third International after Lenin.

What does this positivist strain in Marxism owe to Marx? Marx always clearly distinguished his materialism from the French materialism of the 18th century (La Mettrie, Helvetius, Holbach), and qualified his materialist credentials by referring to 'the materialist basis' of his dialectical method. French materialism of course derived from, on the one hand, the mechanistic philosophy of Descartes, and on the other, the materialism of Bacon, Hobbes and Locke. For Marx, this materialism, which he encountered in its most developed form in Feuerbach, was both mechanistic and contemplative.

The French materialists in particular emphasised the influence of environment and circumstances in moulding human character, and saw the human mind in this process as a passive receiver of sensations. As Marx pointed out in the `Theses on Feuerbach,' the active side of cognition was ignored, enabling the idealists to emphasise the importance of the subject in the creation of knowledge. But Marx goes beyond the contraposition of subject and object as autonomous entities, introducing the idea of 'real sensuous activity', by which he means the unity of cognition and practical activity. Marx does not just bring these two categories together, but rather goes beyond them. Gone is the relation of man to the world as one of knowing subject confronting external object, and gone therefore are the specific problems associated with this relation: gaining knowledge of the external world, which according to the materialists exists independently of the observer. For Marx this is a false and entirely misleading issue, because there are no pre-given 'facts', there is no natural datum of experience existing independently of human subjects. The so-called objects of knowledge are in fact socially mediated objects, determined by the needs of human beings in their struggle for existence. Moreover there is no nature existing independently of and prior to humans - it too exists as it does only for human activity - nature is for Marx, 'man's inorganic body'. Humanity only knows the world which its productive activity has created. In The German Ideology, Marx says:

The sensuous world... is not a thing given direct from all eternity, ever the same, but the product of industry and the state of society; and indeed, in the sense that it is a historical product, the result of the activity of a whole succession of generations, each standing on the shoulders of the preceding one, developing its industry and its intercourse, modifying its social organisation according to the changed needs. (11)

The conventional epistemological problem, which exists for both materialism and idealism, of whether the external world exists, or how knowledge is possible, and is produced, did not exist for Marx. In this sense Marx was not pursuing epistemological lines of enquiry. Yet the post-Marx tradition of Marxism has been predominantly concerned with the construction of a scientific epistemology in the classical sense.

In place of the subject-object dualism of 'contemplative materialism', Marx employs the categories of 'sensuous activity', the 'real life process' of world-objectifying social activity ('vergegenstandlichung'). With these categories he draws attention to the fact that it is human beings engaging in social labour who create their objective world. Where materialism sees the discreet entities of object and subject in a mechanical relation of cause and effect, Marx's naturalism starts from labour as object-constituting activity. What we have is a profoundly different concept of science to the one held by materialism and its heir, positivist social science. Where the latter focuses on the knowability of the social world and nature (i.e., objective reality), distinct from the knowing human subject, Marx's starting point is 'anthropological' - the nature of man as producer whose world is his historically created reality. This is what Marx meant in referring to a science, a natural history, of man. This science is historical and therefore concrete, because its object is the succession of social relations through which humanity has produced the world. This contrasts with the foundation of materialism and positivism, which is unhistorical, and by virtue of that, abstract. The limit reached by contemplative materialism was the limit never transcended by subsequent bourgeois thought. In the forms of social science or philosophy the reigning paradigm was to be epistemology, and its chief preoccupation was the possibility and objectivity of knowledge. In this fundamental respect it remained metaphysical.

While Marx rejected the materialism of his day as contemplative and mechanical, he commended idealism at least for its 'active' side. We see this most clearly in Kant, who argued in his 'Critique of Pure Reason' that the objective world is constituted by the synthetic work of consciousness, the mind possessing innate properties by which it orders experience. In the terminology of epistemological dualism, the subject mediates the raw material of experience (the object) by means of innate categories of thought - the subject thus produces the intelligible world. Hitherto, Kant claimed, it was assumed that knowledge must conform to its objects, but in his Copernican revolution he reversed this, arguing that objects must be seen as conforming to the 'knowledge' of the subject. But while Kant stressed the synthetic role of the human mind, he remained on the idealist terrain of the epistemological subject, and did not transcend subject-object dualism. Such transcendence was to be the achievement of Marx.

Marxism As Ontology

Lukacs believed that Marxists could only fruitfully analyse history and society by means of Marxism as ontology. This, he argued, was only consistent with the method employed by Marx, for whom forms of existence and categories are grounded ontologically. It was invalid, according to Lukacs, to solve the problems of real life by using epistemology as a defining analytic approach. This is indeed what Kantianism, positivism and neo-positivism had tried to do, with the result that they were a block to authentic knowledge. (12)

Lukacs considered ontology as the proper form which philosophy should take, being in the most general sense philosophy based on history:

Marx established that historicity is the fundamental concept of social being, and as such of all beings. This I hold to be the most important part of Marxian theory. (13)

Lukacs considered his own Marxism as having moved in the direction of a general ontology, giving it what he called a 'true philosophical foundation'. He considered that conventional epistemological approaches dwelt only on the possibilities of knowledge, whereas ontological approaches confront the historical necessities, which bring entities into being. (14)

On his own account, Lukacs' later work (in the Ontology of Social Being) focussed on the relationship between necessity and freedom, or in his preferred terminology, between teleology and causality. He sought to go beyond traditional philosophical approaches which had always tended to fix on one or the other of these poles - in stressing necessity, freedom was denied, and vice versa. Lukacs wanted to examine the interrelatedness of the two. The central category in this enterprise was that of 'labour', whose essential feature is teleological. This is so, because the exercise of human labour always involves choices between alternative projected outcomes. In this, labour expresses human freedom. The freedom however is always bounded by objective physical laws, which cannot be transcended.

This is indeed consistent with Marx's approach, and in fact is really only a restatement of the philosophical vantage point already achieved by Marx in his early works (notably the German Ideology) - an ontology of human productive activity, where reality is understood as historically grounded (i.e., changing) human practice. In his last work The Ontology of Social Being, Lukacs writes:

Since Marx made the production and reproduction of human life into the central question, man himself, as well as all his objects, conditions, relationships, etc., acquires the double determination of an insuperable natural basis and the permanent social transformation of this. As in all Marx's work, labour is here too the central category, in which all other determinations already manifest themselves 'in nuce'. (15)

Lukacs draws out the implication of this approach for the Marxist conception of socialism, and in doing so offers an illustration of Marxism as ontology:

It is well known that Marx demarcated his conception of socialism first and foremost as scientific, as against the utopian conception. If we examine this distinction from the standpoint of Marx's ontology, the first decisive aspect that strikes us is that Marx sees socialism as the normal and necessary product of the internal dialectic of social being, of the self-development of the economy with all its presuppositions and consequences, as well as of the class struggle, whereas for the utopians, a development that was in many respects essentially defective had to be corrected by decisions, experiments, provision of models etc. (16)

But Lukacs' restatement is in itself important, since it challenges the dominant trend after Marx, of Marxism as epistemology. For much of this mainstream, the social ontology of Marx was not properly understood, and even ignored. Classical subject-object dualism remained in an ill-digested form within Marxist discourse. It provided the theoretical underpinning of the attempt to fashion Marxism as a positive science.

We have said that the epistemological focus was one which Marx had defined as irrelevant to a natural history of man. But positivistic Marxism, in retaining the category of the subject, has accepted the content and significance this has given to the concepts of consciousness and knowledge. In recognition of this, some thinkers have sought to stress that Marx's contribution centers around the concept of 'praxis' (Labriola, Gramsci, Sartre, among others). The problem with the concept of 'praxis' is that it is too easily interpreted as simply human activity in general, and does not convey what is specific to Marx's notion of human practice - as 'world objectifying activity'. The important point here is that 'praxis' in the latter sense only becomes apparent insofar as the idea of the subject as passive knowledge producer is rejected, and in its place social individuals are seen as producing their world through labour. In this respect Marx does not just give the concept of the subject a different content, but rather replaces it with the altogether different concept of social labour. This is a reversal of the epistemological tradition which runs from Descartes through to Kant, and is continued in positivist social theory.

Yet the mainstream of the Marxist tradition, in which Engels, and some would argue Lenin, were pivotal influences, has reduced the philosophical choice to one between materialism and idealism, identifying Marx as merely an elaborator of Feuerbachian materialism. In this schema Marxism as an historical ontology of social being had no place. The addition of the dialectic to the materialism in no way compensates for this exclusion, since it complements the materialism in what is basically an epistemology. Completing the philosophical revolution initiated by materialism became the raison d'etre of positivist Marxism, its emblem the honing of Marxism as a science in a decisive and self-conscious distancing from philosophy. It thus claimed to be the most thoroughgoing part of the modern scientific enterprise, fulfilling the goal which positivism was held to be incapable of - the achievement of objectivity.

Marx, from the very beginning of his philosophical enterprise, is seeking an ontological ground for the reality beneath the appearances. Throughout he seeks to establish the material presuppositions of human existence by regarding 'being' as production, as labour. Lukacs argues that Marx's so-called 'economic writings' are in fact works of science, but ones which have been arrived at through philosophy. This means that facticity is investigated from the standpoint of actually existing relations, and not facts as isolated and self contained ('fetishised' and 'deified') entities. The philosophical account of Marx's method is to be found in the first part of his book The German Ideology, written in 1845.

Cartesian epistemology attempted an account of knowledge by employing a reductive method of analysis which broke down phenomena into their constituent parts, and insofar as it created for itself a 'problem' of knowledge, turned this 'problem' into one of knowledge of the self (the subject) and its cognitive capacities. This is the 'subjective turn', which is inherent in epistemology conventionally conceived, as an abstract and metaphysical account of the possibilities of knowledge. This approach ultimately throws all questions of knowledge back on to the nature of 'mind' and 'consciousness'. Modern philosophy, dominated as it is by epistemology, is replete with variants of this 'subjective turn'. But this is something that is not only characteristic of bourgeois philosophy. It has molded the mainstream Marxist tradition in turn. An example from a Marxist critique of Economics will illustrate the point. In an article entitled 'Ideology, Knowledge and Neoclassical Economics: Some elements of a Marxist account' (17), Simon Mohun sets out to explore the question why the appearances of capitalism take the particular forms that they do, and why these appearances are systematically delusory. After explaining that the root cause is commodity fetishism, he goes on to argue that an account of fetishism is crucial to an account of ideology. Mohun then suggests that it is the task of a Marxist theory of ideology to provide an account of why ideological systems arise. His posing of the problem however, reveals an approach which falls squarely within the tradition of Marxism as epistemology:

since within Marxism ideology is counterposed to knowledge, or science, then to the extent that such a counterposition can be justified, a theory of ideology necessarily involves a theory of knowledge, and much of modern Marxism has been concerned with establishing the differences between knowledge and ideology, and the relations between the two. (18)

He goes on to elaborate that the problem is one of 'specifying the relation between the knower or subject, and the thing known or object'. (19)

Such a specification is necessary he adds, if choices are to be made between competing theories. Indeed such questions 'comprise the classical problems of epistemology and are the source of many of the areas of debate within contemporary Marxism'. (20)

Mohun takes Marx's thesis in The German Ideology that 'it is not the consciousness of men that determines their being, but, on the contrary, their social being that determines their consciousness', as the essence of the classical Marxist position, but adds that such a statement 'does not provide any solution to the epistemological problem of the relation between thought and reality'. This thesis however presents Mohun with an insoluble conundrum precisely because he chooses to interpret what Marx is saying through the lens of classical epistemology.

But, as has been argued above, this was entirely foreign to Marx's method. Marx was at pains to avoid analysing the subjective stance which proves the existence of the objective world and the degree of accuracy in knowing it. For him this was a philosophical cul-de-sac which forced a fruitless inquiry into consciousness and its conditions of existence. For Marx the question of the relation of thought to reality in its conventional philosophical form had to be transcended, and he did this by focussing his inquiry on 'sensuous activity' and the 'sensuous world':

Where speculation ends - in real life - there, real, positive science begins: the representation of the practical activity, of the practical process of development of men. Empty talk about consciousness ceases, and real knowledge has to take its place. When reality is depicted, philosophy as an independent branch of activity loses its medium of existence. (21)

The epistemological dualism of subject and object is dissolved into dialectic of knowledge as practical activity. Marx explains this at length in his critique of Feuerbach at the beginning of The German Ideology. The premises, from which he proceeds are 'real' or 'material' premises, that is to say, real men engaged in producing their conditions of existence. This is an empirically perceptible process, which has no use for the abstract concepts of 'man', 'consciousness' and 'nature'. But grasping the implications of this transcendence of subject-object dualism has proved to be the most elusive theoretical step for Marxists after Marx.

David MacGregor in his important book The Communist Ideal in Hegel and Marx (22), has provided an important corrective to the retention in Marxism of a subject-object epistemology. He starts from the claim that Hegel's use of the dialectic is identical to that of Marx, and that the essence of both is conceiving thought (knowledge) as identical with its object. He shows that Hegel, in the Science of Logic, talks of subjectivity (the 'Idea') being active in the object, thereby giving itself reality (Truth). But MacGregor argues that Hegel is asserting more than that there is a coming together (an accommodation) of subject and object as categories which exist on their own account. This conception of the relationship is characteristic of what Hegel describes as the error of 'Understanding' (pre-dialectical thinking), which imagines the objective world as a separate, finished entity, to which the cognitive subject (as an equally separate and finished entity) must gain access. For this mode of thought, truth, as a correct correspondence of thought with an object external to and separate from it, does not go beyond the point reached by Kant with his notion of the ultimately unknowable 'thing-in-itself.

If it is MacGregor's claim that the identity of knowledge with its object is the essence of the dialectical method of both Hegel and Marx, what is the mode of existence of this dialectic? MacGregor argues that in Hegel it is 'ideality', the activity (both theoretical and practical) through which men create ideas and translate them into reality. In Marx the corresponding notion is 'revolutionary practice', For both, Labour is the activity which mediates subject and object, and in fact dissolves their separation. And it is Labour which carries with it it the concepts of teleology and contradiction. In fact MacGregor claims that the dialectic of labour as the essence of the social individual, is the core of Hegel's thought which Marx absorbs into his own work, but does not fully acknowledge. At any rate, what we have here is the ontology of social being referred to by Lukacs.

For MacGregor the failure to grasp the identity of knowledge with its object is characteristic of both 'bourgeois' and 'Marxist' thought. In fact both these traditions conceive of thought as separate from its object, and regard any claim to the contrary as idealistic and metaphysical. The error of the 'Understanding' is, MacGregor argues, 'the root of all ideology or false consciousness; it forms the dominant structure of thought in capitalist society - a structure which both Marxist and bourgeois have in common' (23).

What are the implications of Marxism as epistemology? In the most general philosophical sense it is without a dialectic. Subject and objective reality are separate entities, and as such are without any logic of transformation. The relation is one of existents whose defining feature is separation. When the formal description of dialectic as the conflict of opposites has been applied, the source of movement is conceived mechanically as the coming into conflict of two externally constituted entities. Even in the formal sense this loses the notion of dialectic as the unity of opposites, which alone generates, from its inner structure the necessary antagonism that generates qualitatively new development. The fact is that Marxism as epistemology has, because of its metaphysical leaning, remained preoccupied with formal dialectical structures, which because they rest on reified categories, are ultimately sterile. Since the unacknowledged assumption is that such dialectical formulas are to be applied to reality, they merely reproduce the separation of theory and practice so central to the contemplative approach of bourgeois philosophy.

Marxism as ontology privileges social labour as its ground, and from the dialectic of labour as a commodity under capitalism, poses the necessity of free labour. The impulse of transformation lies in the very nature of human labour as world-objectifying activity. Marxism in this sense is the 'political economy' of free labour (as communism), not scientific knowledge of an objective, and therefore reified reality. The teleology expressed in this dialectic of labour is not the assigning of an arbitrary terminus for 'history' or 'society' (again, reified categories), but is of the nature of an inner necessity, flowing from human labour in its historical development, in the complete unfolding of its social character (its decommodification as communism). Forces of production and relations of production, are second order concepts which derive their significance only insofar as they articulate the dialectic of labour. Isolated (i.e., reified), they cannot explain historical development, which is why all attempts to extrapolate a formula for historical materialism from Marx's famous 1859 Preface have proved unsatisfactory, and have more often than not led to declarations of the redundancy of Marxism.

The theory of commodity fetishism is the clearest expression of Marxism as ontology. It grounds the categories of class, value and exploitation ontologically and thereby posits the possibility of decommodified, free labour. An epistemological reading of commodity fetishism, rooted as it is in the separation of subject and object, treats it as a problem of distinguishing the forms of appearance from reality, and therefore a problem of perception (i.e., misperception), of ideology. This is a point appreciated by Etienne Balibar in his The Philosophy of Marx:

Now fetishism is not a subjective phenomenon or a false perception of reality, as an optical illusion or a superstitious belief would be. It constitutes, rather the way in which reality (a certain form or social structure) cannot but appear. (24)

The words 'cannot but appear' are key here, and they refer us to Marx's overturning of philosophy's conventional understanding of objectivity. Balibar goes on to suggest this (without, it has to be said further developing the point):

We can now see that with Marx's argument, by way of an apparently contingent detour through the analysis of the social forms of commodity circulation and the critique of their economic representation, the question of objectivity was entirely recast. The mechanism of fetishism is indeed, in one sense, a constituting of the world: the social world, structured by relations of exchange which clearly represents the greater part of the 'nature' in which human individuals live, think and act today. (25)

Marx argues, in his earliest writings (the 1844 Manuscripts in particular), that it is man's 'sensuous activity' which creates an objective world. Reality is therefore a product, an objectification of sensuous activity; so-called 'objective nature' is not simply given, but must be established, constituted by human practice. To the extent that man's reality appears over and above him, as a dominating and autonomous force, it is so precisely because of the form taken by his labour as a commodity. Alienated labour is thus the pivotal category, which makes its appearance in the 1844 Manuscripts, and which is further developed through the theory of commodity fetishism in the Capital of 1867.

In contrast to Marx's standpoint, reified thinking rests on the established separation of the subject from the world. It segregates subjectivity from 'nature', from 'objective reality', granting it only the properties of perception or knowing, which are separated from what Marx calls the 'world objectifying activity' of real, human individuals. But it does this not from any peculiar logic internal to itself, but because it reifies categories arising from a world constituted by alienated labour. The understanding of labour as a thing (as commodity), which is characteristic of capitalist society, is of course a reified one: labour fixed in its subordination to and separation from Capital (or in the terminology of orthodox economics, labour as a factor of production). The theory of commodity fetishism, in showing why labour must appear in this way, at the same time posits the negation of labour as commodity.

I have argued that Marx did not lay the basis for a scientific epistemology. In fact the originality of Marx lay in his attempt to go beyond the dualisms offered by mechanical materialism and Kantian idealism, and elaborate an ontology of social being, at the heart of which was a dialectic of labour. The orthodox tradition which grew up after Marx however, crystallised into a positivist epistemology, unable to break fully free from the reified conceptual structures of bourgeois philosophy and social theory. Such reification is rooted in the sundering of the subject from the objective world, the defining feature of modern philosophy. The passive, contemplative relation of the cognitive subject to nature underpins the separation of thought and being, theory and practice. Such a subject confronts a reality which is always finished, always 'given' prior to the observer. Theory therefore plays no active part in the constitution of this reality, but produces the concepts of science as the abstractions of the entities it appropriates. Reified thought thus 'fixes' as 'things' what are the expressions of, because actually based on, social relations. It separates and seals off its categories as discreet entities bearing no organic relation to each other. The notion of the theoretical object as a totality of interconnected categories which is in the process of continuous change, is entirely foreign to the metaphysical method of bourgeois thought.

Positivist Marxism identified itself as a scientific theory of knowledge, embodied in the theory and the programme, and applied to its object, the proletariat. But such a conception reflected the reified structures of the ruling ideology, albeit delivered in the language of Marxist concepts. Thus:

Scientific epistemology--------->Produces knowledge--------->Applies knowledge to object

A positivist Marx sees capitalism, more specifically Capital, as a finished entity (ready-made and essentially complete), separate from labour, to which labour has to adapt and confront, and which it therefore has to 'know', as one knows an alien object. This is Capital as object or 'thing'. Reifying Capital at the same time reifies the category of Labour. It too becomes a fixed and unchanging essence in the world, moved only by Capital, to which it is always subordinate. A dialectical Marxism by contrast, knows capital as a social relation, produced and reproduced by labour under definite historical conditions. Capital and labour are but the expression of alienated labour in a system of generalised commodity production. The relation of labour to capital is only the relation of labour to itself, and going beyond capital is the self-transforming of labour, a transformation which is driven by contradictions internal to its form as value.

Arising from these different conceptions of the capital-wage relation, are opposed conceptions of class struggle. Positivist Marxism sees the class struggle as the conflict of exclusive entities (Capital and Labour) which move into relations of contingent, but not necessary, opposition. Dialectical Marxism recognises the class autagonisn embodied in alienated labour, not as the result of the subjective inclinations of capitalists or workers (although this is the form through which class struggle is expressed), but because of the form that this labour takes - as value producing labour.

Marx, in Capital, and in Theories of Surplus Value (26), makes the value form of labour the crux of his criticism of Ricardo. He asks why Ricardo 'never once asked the question why labour is expressed in value', pointing out that in failing to examine the specific form that labour takes under capitalism, he is unable to understand the historical specificity of capitalism as such (as opposed to production in general). The point is that only in this historically specific form of supply does labour produce value, that is to say, where the labour of individuals is expressed as abstract social labour. Value, for Marx, is the product of social labour and its form is exchange value.

Analysis of the value form is critical, for as Scott Meikle has argued, the driving contradiction in capitalist society is that between the form and content of the commodity form. The contradiction is immanent in the value form, expressing itself as that between human social labour and its value-creating form. Meikle's outline of Marx's analysis of the value form of labour, is part of his larger exposition of Marxism as an 'essentialism', a philosophical standpoint in stark contrast to the prevailing empiricist 'atomism' of bourgeois theory. He further argues that Marx's conception of the historical process and its contradictions are founded upon an essentialist ontology of the real natures of things, an ontology which transcends the false dualisms of empiricist epistemology. (27)

The Emergence Of Marxist Economics

Positive economics is essentially the study of reified categories (in the language of the discipline, variables such as, price, cost, demand, profit, demand, profit, etc). Such 'economic facts' are reified insofar as they are abstracted from the social relations in which they are rooted, and of which ultimately they are the expression, however distortedly. Such abstraction is total, investing in such variables a self-sustaining power which in reality only social relations between people possess. In granting variables such 'thing-like' qualities, the nature of the social relations underlying them is totally obscured. Such reification is expressed most succinctly in the idea of the `economy' as a thing, separate from other spheres of life (politics, the family, etc.,), and made up of those 'facts' designated as 'economic'. The economy thus reified has a life of its own, operating above and beyond the actual existence of its participants (who are identified as 'economic actors'). The economy as machine is the most telling metaphor at work in orthodox economic, and the language of modern economics is replete with the associated reified imagery: the economy is talked about as something which either harms or benefits people, which is beyond or under their control, which overheats, stagnates or prospers. The unifying idea is that the economy is an entity, a thing, autonomous of the human beings who are largely powerless to affect its laws of working.

The concepts of 'the economy' and the 'economic' possess no methodological significance in the work of Marx. Yet despite this, the overwhelming majority of Marx commentators, and indeed many Marxists, compartmentalize Marx's work into philosophical, political and sociological writings. To refer to Marxist economics is commonplace among avowed Marxists. So for example, Ernest Mandel refers to Marx's 'economic theory', and contends that 'Marx's contributions to economic analysis lie essentially in the field of the theory of value and surplus value...'(28). Those who eschew the idea of a Marxist economics invariably prefer the notion of Marxist political economy, but even here Marx was very clear that he was engaged in a critique of political economy, a critique that meant going beyond the social and property relations which made political economy necessary.

The reified character of bourgeois economics has had a pervasive impact on the attempt to develop Marx's critique of political economy, an impact resulting from developments following the Bolshevik revolution. The years leading up to the Russian revolution of 1917 were dominated by the work of Hilferding, Lenin and Luxemburg, and focussed chiefly on the question of Imperialism. This reflected the emergence of a truly global capitalism in the last quarter of the 19th century, and it concentrated the minds of the best Marxists on the material preconditions of the world revolution. In the early 1920s the survival of the young soviet workers state generated the industrialisation debate involving among others, Bukharin, Preobrazhensky and Trotsky. While the possibility of revolution in Germany still existed, the debate could encompass the view that socialism could only be built in the Soviet Union if capitalism was overthrown elsewhere - the question of the victory or defeat of revolutionary class struggle outside the USSR was therefore still the central issue. But with the ebbing of the revolutionary tide in the mid-20's, and the defeat of the Left Opposition in the Soviet Union, the debate turned inward, focussing on the Stalinist strategy of socialism in one country. Varga became the most prominent Soviet analyst under the Stalin regime, devoting his attention to the question of whether capitalism would stabilise or experience further stagnation. If socialism in one country was possible, an accurate assessment of capitalism's prospects was critical for deciding the internal and external policy of the Soviet Union. Since Stalinism was to mean the complete atomisation of the working class under a command economy policed by terror, a political economy crystallised whose limitations reflected the needs of such a regime.

Soviet historical materialism was conceived as an account of the objective logic of world history, where successive modes of production were seen as the motors of historical evolution. The Stalin regime regarded the economy over which it presided as the incarnation of the newly emerging socialist mode of production. But in this view, Marx's class struggle as the motor of history was entirely absent, replaced by productive forces which developed objectively according to their own inherent laws. Labour as a dialectical category disappears completely in this reified political economy, and to the extent that class antagonism remains, it is transmuted into the competition of rival economic systems. History becomes the succession of modes of production, the progressive unfolding of which has a logic independent of the will of the human beings involved. Such objectivism became the hallmark of orthodox Marxism, indicating its degeneration into a closed, reified dogma.

The ebb of the world revolution and the consequent isolation and bureaucratisation of the Soviet workers state, were the key factors leading to the ossification of Marxism into a dogmatic and apologetic state ideology. The output of Soviet political economy for over 60 years, was the work of official 'economists' in the service of the Stalinist State. But through the vehicles of national Communist parties, Soviet 'Histomat' also influenced an entire generation of Marxist intellectuals outside the Soviet Union. With the consolidation of Stalinist power in the 'east', and the onset of the democratic counterrevolution in the 'west', Marxism after 1945 retreated into the academy. Reflecting the influence of segregated social science disciplines, Marxist political economy fell increasingly under the umbrella of Economics, and was increasingly identified as Marxist economics. The double influence of waning class struggle and the quantitative approach of orthodox academic economics, gradually reduced the presence of labour and class antagonism from the literature of Marxist economics. The latter retained Marxist categories, but tended to employ them in the standard areas of research, and in the theoretical framework favoured by the orthodox mainstream. Emptied of a focus on labour and class struggle, Marxist economics could become, despite its radical terminology, just another safe area of academic study.

The other influence facilitating the development of a domesticated Marxist economics was the challenge of Keynesianism. The theoretical significance of the work of Keynes lay in his claimed break with the Classical tradition, and the inspiration it gave to a new generation of economists to break new ground for their discipline. The Keynesian thesis that a capitalist economy could remain in equilibrium with high levels of unemployment and stagnating output has provided a powerful pole of attraction for left-leaning and radical thinkers since Keyne's General Theory appeared in 1936. In particular, the Keynesian revolution gave rise to a radical strand of orthodox economics known as Post-Keynesian theory.(29) Based on the twin contributions of Keynes and Kalecki, it's most prominent exponent in England was Joan Robinson, and its focus was the instability and tendency to crisis of the capitalist system. For this reason many academic Marxists saw in this wing of orthodox economics a research agenda and a theoretical framework not that dissimilar to their own. For 30 years after the emergence of Keynesianism, a 'Marxist' presence in the field of economics was represented by a small number of academics - Maurice Dobb, Ronald Meek, Paul Sweezy, Paul Baran, Joseph Gillman; while others, such as Michal Kalecki and Joseph Steindl, presented a radical profile by incorporating 'Marxist' concepts into what was essentially an orthodox framework. In the 1970s there was a revival of interest by the orthodox economics establishment in Marx, and a new generation of academic Marxist economists sprang up. But with exceptions this was Marxist economics, which when not seen merely as a sub-discipline of the mainstream, was firmly situated in the tradition of positivist social science.

A crucial development which did take place in the 70s-80s revival of Marxist scholarship was the emphasis placed by some Marxists on 'value theory'. This placed the labour theory of value (or law of value) at the very center of the Marxist analysis of capitalism, attempting to engage with the question which Marx reproached Ricardo for not asking: why does labour take the form that it does, as value creating labour? John Weeks, as a proponent of this standpoint sums it up as:

the view that value theory is the key to unlocking the inner nature of capitalism; that because of what Marx called 'the fetishism of commodities', capitalism cannot be fruitfully analysed in terms of its surface manifestation (prices, profits, wages, etc.,). Rather, the surface appearances hide the true nature of capitalist society and must be understood as reflections of the underlying value relations. (30)

The task is therefore primarily one of demystifying the obfuscating appearances of capitalism. Weeks identifies Lenin, Rubin and Henryk Grossman as earlier representatives of this approach, while pointing out that 'Marxists' such as Baran and Sweezy explicitly rejected 'value theory' as a tool of analysis. The dividing line between those who identify with a 'value theory' approach and those who do not, is clearly important in deciding the very validity of Marxist economics as a disciplinary practice.

Marxist economics has largely focussed its efforts on the elaboration of theories of capitalist crisis. What is striking about these contributions is that the concepts traditionally identified in Marx's writings - surplus value, organic composition of capital, the falling rate of profit, etc., and relationships such as those between departments of production (disproportionality, underconsumption, overproduction), have for the most part been employed in the quantitative and technical fashion characteristic of positive economics. This means that the concepts thus used are abstracted from class struggle and become reified. So for example, much of Marxist economics has been concerned to pinpoint the origins of capitalist crisis in configurations of disembodied, technical categories. It is no accident that labour has been the one category which has been largely absent in this approach. Marxist economics in this way reproduces the objectivism of orthodox economics - the tendency to regard capitalism as an entity autonomous of its human actors, and insofar as labour is included in its list of variables, it is as a factor of production, and not as the central, integrating category of its analysis.

The technical, quantitative approach has led to a preoccupation with identifying those tendencies leading to the breakdown and collapse of capitalism. This search for the cause of system dysfunction is reified thinking par excellence. As Lenin famously pointed out, there is no such thing as a terminal crisis of capitalism - the final collapse never arrives, since all crises can be resolved IF the working class is prepared to foot the bill. The precise outcome of a crisis is always in the last analysis a question of the balance of class forces. But systems thinking does not appreciate that capitalism is the particular and unique way in which a class of capitalists pumps the surplus out of the direct producers, and is thus the changing series of forms which that exploitation of labour takes. The various forms of the labour process are always the original outcome of the conflict generated over the distribution of the surplus product, the resolution of one phase of conflict preparing the conditions for the form that the next phase will take. It is in this process that the source of the crisis of capital accumulation is to be located. To adhere exclusively to a theory of underconsumption, overproduction, or falling rate of profit, is to grant such measurements an explanatory power which they do not possess.

There are those Marxist economists who see the development of a 'quantitative Marxism' as the means of avoiding the marginalization of the 'discipline'. The Marxist debate over 'value theory' in the 70s and 80s is regarded as having led to a dead end, failing as it did to generate an engagement with orthodox economics. The antidote to such sterility lies in taking up 'the tools and data of orthodox analysis' in order to capture such phenomena as 'the dynamics of capital accumulation' (31). The failure of 'value theory' Marxism is quite clearly seen to be its antiempirical bias. But the argument turns on what is meant by the empirical. What quantitative Marxism means by empirical is reference to the statistical data which an engagement with the techniques and analysis of orthodox economics makes available. However what is crucially forgotten is that when 'value theory' employs categories which start from the relations of commodified labour (value-producing labour), this is a concrete analysis of social relations. This is in complete contrast to the approach of orthodox economics, which while priding itself on starting from the 'empirical' (price, profit, cost, etc.,), is in fact only looking only at the surface appearances of capitalist distribution, appearances which obscure social relations rather than illuminate them, and which is therefore anything but concrete.

The recent efforts to elaborate a quantitative Marxism have been paralleled by renewed interest in models of market socialism. Although the first market socialists were early 19th century utopian socialists and radicals, such as Hodgskin, Gray and Proudhon, against whom Marx polemicised, the twentieth century version of market socialism was a response to the claim made in the 1920s and 30s by Ludwig von Mises, Lionel Robbins and Friedrich Hayek, that rational economic calculation and an efficient allocation of resources was impossible in a socialist economy. The recent revival has been fuelled largely by the collapse of the soviet model of command economy, leading to a thoroughgoing questioning by the radical intelligentsia of the traditional Social-Democratic forms of public ownership and state intervention in a capitalist economy.

Market socialism asserts the indispensability of markets in any system of resource allocation. It thus believes that socialism cannot aspire to the complete replacement of markets with planning. Oskar Lange, Fred Taylor, H.D. Dickinson and Abba Lerner produced the basic market socialist model. (32) The challenge they addressed was the one laid down by Neoclassical economic theory and defended vociferously by von Mises and Hayek: that only under a free market capitalist system is it possible to achieve efficient resource allocation. Their broad solution was to suggest that a central planning board would set market-clearing prices (through a process of trial and error) to which individual enterprises could adjust their output (or in the case of Lerner, allow 'socialist' enterprises to form their own market prices). This was to be supplemented by a state provided social dividend payment to offset the inequality of wages resulting from market determined wage differentials.

The key point was that such a system was supposed to be capable of simulating the resource allocation function of decentralised perfect competition and delivering an allocation of resources as good as, if not better, than could be achieved under capitalism. Most importantly, the standard of efficiency adopted was the one fashioned by Neoclassical economics. In fact the use of the label socialist to describe the system was entirely misleading, since it presupposed the continued existence of wage labour and capital, and of course markets.

Hayek aptly called it a model of 'competitive socialism'. Despite the extensive debate now taking place over market socialism (33), contemporary proponents of market socialism add nothing new to the older models, except perhaps a greater preoccupation with the politics, as opposed to the economics of the case.

Market socialists have always been united in seeing the market as an economically neutral mechanism for the allocation of resources, and one which will still be required under a socialist system. According to this view markets may operate inefficiently under capitalism (market failure), but they can be made to work efficiently and in the service of human needs - they are, in other words, essentially system neutral. Such a view of markets comes directly from neoclassical economics, which conceptualises them as mechanisms for reconciling the supply and demand of use-values, and which therefore, any system of economy must rely on.(34) But this is to think of markets as the means of distributing use-values as opposed to the regulation of exchange value; in other words a physical as opposed to a value conception of markets. For Marx, the market is the medium through which the law of value regulates the allocation of labour time - markets presuppose value-creating labour, and it is quite mistaken to imagine that you could have one without the other. If socialism is defined as the defetishising of the relations of production, the decommodification of human labour, then this means nothing less than the ending of labour as a value-creating activity, and with it the role of the market as the regulator of this activity. (35)

The contradiction which has always existed at the heart of market socialism is that between the reality that the retention of markets means the retention of capitalism, and the claim that retaining markets is compatible with socialism, and in this respect market socialism is the ultimate contradiction in terms. Clearly, it all depends on how socialism is defined, and if, as is the case, it increasingly means only a more humanitarian regulation of the capitalist system, resolution of the contradiction means the disappearance of socialism as a meaningful alternative to capitalism. Recent attempts to provide greater philosophical and methodological sophistication to the market socialism model have come from Analytical Marxism, a current of thought which has emerged as one of the leading edges of Marxism in the academy. Associated with the names of G.A.Cohen, Jon Elster, John Roemer and Erik Olin Wright, it is highly self-conscious of its claim to theoretical innovation. What this amounts to is an attempt to read Marx, and reformulate the conclusions of the Marxist tradition, from the standpoint of methodological individualism, in particular using concepts originating in the marginalist revolution of neoclassical economics. In many respects this is nothing new, but it has made the running in many academic circles given the demoralised state of many of the radical intelligentsia. Analytical or rational choice Marxism, is usually perceived to be the result of the importation into Marxism of a positivist method. But if the Marxist orthodoxy is, as I have argued, already strongly positivist, Analytical Marxism should be construed not so much as an alien import, but rather the further reification of an already reified body of thought.


Marx argued that the commodity (which was the starting point of his whole analysis) was 'mysterious' precisely because the social character of labour appears as the objective character of the relations between commodities themselves, i.e., commodity fetishism 'attaches itself to the products of labour, as soon as they are produced as commodities' (36).

This concept of commodity fetishism is therefore a property of value-producing labour. Since it is through the mechanism of exchange that the social character of the labour of individual producers is expressed, the market is an integral aspect of this value producing process. Thus the products of labour assume the form of things which dominate the lives and labour of the producers, and reify the very forms of thought, which seek to apprehend the process of wealth creation.

But the mainstream tradition of Marxism has moved a long way from the ontology of social being which Marx fashioned to demystify value creation. It has correspondingly displaced the categories of fetishism and reification from the analysis of labour, and in doing so has fallen prey itself to the use of reified concepts. Nowhere has this been more marked than in the practice of Marxist economics, for it is in the sphere of economics that reified categories exert their strongest influence. Thus the task of re-establishing value analysis as the core of Marxist thought (and resisting the pull of quantitative Marxism, analytical Marxism, and market socialism), is part of the task of reestablishing Marxism as ontology, and the defetishisation of labour as its object. The socialism registered by this ontology is thus the abolition of wage labour, of commodity production and the market - in short, the suppression of the law of value. At the end of an era of reified socialisms, in the space created by the collapse of Keynesian 'socialism' and Stalinist 'communism', it is socialism as the emancipation of labour which Marxists must fashion anew.



1. Georg Lukacs, History and Class-Consciousness (Studies in Marxist Dialectics). Merlin 1971.
2. Karl Marx, Capital (in 2 volumes), Volume 1, translated from the 4th German edition by Eden and Cedar Paul, p. 46. Dent 1957.
3. Lukacs, op. cit, p.93.
4. Ibid., p.94. 5. Ibid., p.93. 6. Ibid., p. 95.
7. I.I.Rubin, Essays on Marx's Theory of Value, translated by Fredy Perlman from the 3rd Moscow edition. Black and Red, Detroit 1972.
8. Ibid., p. 6.
9. Ibid., p. 31.
10. Marx and Engels, The German Ideology, Parts 1 and 3, p.197. New York 1947.
11. Ibid., p. 35.
12. Theo Pinkus, Ed, Conversations with Lukacs, p. 24. Merlin 1974.
13. Georg Lukacs, Record of a Life (An Autobiography), p. 142. Verso 1983.
14. Ibid., p. 164.
15. Georg Lukacs, The Ontology of Social Being, 2: Marx, p.6. Merlin 1978.
16. Ibid., p. 159.
17. Simon Mohun, "Ideology, Knowledge and Neoclassical Economics", in Francis Green and Petter Nore, Eds, Issues in Political Economy. MacMillan 1979
18. Ibid., p. 250.
19. Ibid., p. 251. 20. Ibid., p. 251.
21. The German Ideology, p. 15.
22. David MacGregor, The Communist Ideal in Hegel and Marx. George Allen and Unwin 1984.
23. Ibid., p. 12.
24. Etienne Balibar, The Philosophy of Marx, p. 60. Verso 1995. 35. Ibid., pp. 65-66.
26. Karl Marx, Capital, Volume 1, p. 174. Harmondsworth 1976. And Marx's Theories of Surplus Value, Volume 2, p. 164. London 1969.
27. Scott Meikle, Essentialism in the Thought of Karl Marx. Duckworth 1985. 28. Ernest Mandel, 'Economics', in Marx: [i]The First 100 Years, Ed by David McLellan. Fontana 1983.
29. See Alfred. S. Eichner, A Guide to Post-Keynesian Economics. MacMillan 1979.
30. John Weeks, Capital and Exploitation, p. 6. Arnold 1981.
31. See the collection of essays in Paul Dunne, Ed, Quantitative Marxism. Polity Press 1991.
32. Oskar Lange and Fred Taylor, On the Economic Theory of Socialism, Ed by B.E. Lippincott. Minneapolis 1938; H.D.Dickinson, Economics of Socialism, Oxford 1939; A.P.Lerner, The Economics of Control, New York 1944.
33. For an informative survey of the literature, see Fikret Adaman and Pat Devine, On the Economic Theory of Socialism, New Left Review 221, Jan/Feb 1997.
34. This approach is to be found in Ota Sik, The Third Way, Wildwood House 1976, and in Alec Nove, The Economics of Feasible Socialism, Allen and Unwin 1983.
35. For a sustained critique of the tradition of market socialism, see David McNally, Against the Market (Political Economy, Market Socialism and the Marxist Critique). Verso 1993.
36. Marx, Capital Volume 1, p. 76. Progress 1974.

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Jul 13 2008 06:14

The response to market socialism, while clearly knowledgable, assumes an embarrassingly narrow definition of 'socialism' which retroactively writes many non-Marxist (and some Marxist) socialist tendencies out of the socialist movement, even the ones that preceded and influenced Marx himself.

Socialism is not universally defined as the suppression of markets, wages, or profit.

Furthermore, the critique in no way addresses the potential for market socialist models to provide a universally high quality of life, equitable and efficient allocation of resources, and social stability even if they don't fit into a particular dogmatic view of socialism (and one which seemingly equates anything that doesn't fit in this view with another form of capitalism).