Subject: Re: Actually it's potential/real, actual, experience
Date: Mon, 19 Feb 2001 06:22:33 -0700



Dear Seminar-Listers:

There was a good discussion between Viren, Greg, Ruth,
Victor, and Norm about the ontology of scientific laws.
What we observe in an experiment is not the law itself but
its actualization under controlled circumstances.  The law
itself is the tendency of something to act.  This something
is part of reality and may therefore be accessible to us
also in other ways, and may also act in different ways.

Viren asks whether laws must always actualize themselves.
Bhaskar's answer to this is: No.  He writes in RTS2:17:

> Tendencies may be possessed unexercised, exercised
> unrealised, and realized unperceived (or undetected) by
> men; they may also be transformed.

I think "exercised unrealized" means: the thing tries to
exert its tendency but it is counteracted by other things.
The vase tries to follow the law of gravity and fall down
but this tendency is counteracted by the table on which it
stands.  But the law of gravity has the effect that the vase
stays put and does not float around and bump against things.
This is an example how a tendency can be transformed.
"Possessed unexercised" means: a law does not always try to
act.  Humans have to eat but they are not always hungry.


Norm brought as counterexample the law of gravity.  He said
it is not the tendency of some thing to act but it acts
between things, it acts at a distance.  I agree that this is
a problem for Bhaskar's theory, but I think the better we
understand the laws of physics the more it becomes apparent
that they are indeed the tendencies of things to act.  I
don't know enough about physics to speak here with full
confidence, but as I understand things, modern quantum field
theory no longer talks about fields acting at a distance,
but about particles scurrying back and forth to generate the
effects which were formerly modeled as a "field".  Instead
of Maxwell's equations governing electromegnetic fields we
are talking about photons.  Perhaps at some point gravions
will be discovered, whose interaction mediates the laws of
gravity.


What about the falling rate of profit?  It follows from three
basic assumptions Marx makes about the capitalist economy
and the nature of technical progress:

(1) value and therefore also profits come from labor only;
machines do not add new value to the product, they only
transfer their own value.

(2) As long as there is capitalism, there must be technical
innovation.

(3) Technical efficiency gains, i.e., the overall shortening
of the labor time it takes to produce a product, can
generally only be gained by making labor more and more
"roundabout" as some economists call it, i.e., a greater and
greater portion of the total labor time to produce the
product must go into long lasting machines and other
preparatory work, and a smaller and smaller portion is
living labor needed to produce the individual product.

If these three theses are correct, then the rate of profit
must fall, because capitalists need more and more constant
capital, which does not create value, in order to be able to
put their laborers to work, which do create value and
profits for them.  There is no way around this as long as
capitalism exists.  Now the capitalists are the ones who
make the decisions to innovate, and they hacve many means at
their disposal to maintain their profitability, etc., and
they are often successful.  This is why there are so many
"countervailing influences."  But this does not annul the
mechanism which I just described.  Whatever schemes the
capitalists come up to counteract it, the mechanism itself
is still operative, and it is more permanent than any one of
these schemes.

One particular strategy to counteract the fall in the rate
of profits has become available with modern information
technology: shorten the turnover cycle, just-in-time
deliveries, immediate shutdown of production before unsold
products can pile up, etc.  But such quick reactions can
make the market system unstable.  I.e., the actual effect of
the above-described mechanism is not that the rate of profit
falls, but that the economy becomes more unstable.  Again an
example of a transformation.


Yes, Victor, traditional Econ courses try to avoid any
mention of the rate of profit as the devil avoids the holy
water.  The rate of profit is one of the most fundamental
macroeconomic data, and it is not even measured by the
government-run statistical offices.  According to
neocloassical economics, profits should be competed away.
It is a huge embarrassment for the discipline that this is
obviously not the case, but this is simply swept under the
rug, or explained away with flimsy excuses.  One version of
the theory of investment functions says for instance that
the rate of profit is positive because capitalists are too
slow to realize their investment plans, therefore there is
not enough investment.  It is an age-old adjustment problem
which the capitalists simply cannot solve.  The stories
economists come up with after one strips away the math are
often truly comical and preposterous.


-Hans.


     --- from list seminar-14-AT-lists.village.virginia.edu ---