Theory and Practice

by Kieran Healy on September 9, 2004

“Dan Drezner”: reports on a “small tiff”: between Paul Samuelson and Jagdish Bhagwati over outsourcing. It contains a good line that tells you a lot about neoclassical economics:

bq. But Mr. Bhagwati … says he doubts whether the Samuelson model applies broadly to the economy. “Paul and I disagree only on the realistic aspects of this,” he said.

In contrast, Marxists tend to agree fully on the realistic aspects of things but disagree about the unrealistic ones, such as when exactly the revolution is coming, who will be in charge, and whether people or robots will clean the toilets afterwards.



dsquared 09.09.04 at 10:45 pm

The great thing about Samuelson is that (as veterans of the Cambridge Capital Controversy know) he is incredibly intellectually honest, but manages to end up surrounding himself with groupies who aren’t.

The issue here is that Samuelson notes that there will be short-term (the short term can last a surprisingly long time) losers from outsourcing, and therefore suggests that there should be some social policies carried out to cushion the blow for the losers.

His groupies, however, pay lip-service to this, say “of course we must do something for the losers”, and then go ahead and cut welfare. Samuelson’s giving them a nudge to keep them on the intellectual straight and narrow.

FWIW and BTW, my personal view on the outsourcing thing is that Bhagwati is probably correct in his central argument, which is nothing to do with economics but takes the form of saying “all previous predictions of imminent economic disaster as a result of trade policy have turned out to be bollocks so this one probably is too”.


Scott McLemee 09.10.04 at 12:41 am

Can we just let the “robot/toilets” thing rest for a while?

If it were possible do the 1980s over again, that is one debate I would spend a lot less time on. The revisionists made a lot of good point, now that I think back on it.


dsquared 09.10.04 at 1:07 am

“If Corsica declared war on Sardinia and won, then continued to rule over Sardinia while not itself declaring independence from France, would that be imperialist?”


Kieran Healy 09.10.04 at 1:25 am

Um, you mean there really was a robots/toilets debate?


Matt 09.10.04 at 1:34 am

I’d be happy to have either a robot or a person clean my toilet, if I don’t have to pay.


jc 09.10.04 at 9:49 am

Robots- nonsense. It will be monkey butlers for sure.


dsquared 09.10.04 at 12:03 pm

Now the question of whether the work done by trained monkeys is part of surplus-value is a discussion that I absolutely do remember having.


John Quiggin 09.10.04 at 12:04 pm

I’m having great fun imagining this debate. Are robots fellow-workers? Do they suffer alienation? Do they produce surplus value? It could go on forever, and sounds as if it just about did.


dsquared 09.10.04 at 12:22 pm

It would be nice to have a discussion about Samuelson and outsourcing, but frankly Kieran only has himself to blame. The robot toilet thing is much more interesting.

Robots are capital equipment, surely. They embody the labour used to produce them, but their own productive activities are not labour, not alienated and thus not part of surplus value. The widespread robotisation of labour would be associated with an economy-wide lowering of values.


John Quiggin 09.10.04 at 12:47 pm

DD, I see we posted the same thing simultaneously. Surplus value down the toilet!


dsquared 09.10.04 at 1:45 pm

I would also hazard a guess that although trained monkeys would be workers, and there would be a sense in which their labour was alienated, they would not be capable of being part of a relation of production, and therefore a toilet-cleaning monkey’s work would not be part of surplus-value.


Chris Bertram 09.10.04 at 2:14 pm

Do relations have parts? I suppose complex ones might be said to have. But monkeys are surely capable of being the objects of an ownership relation: I can own a monkey. Is the thought that monkeys can’t own themselves? Well neither can slaves and they are sure as hell part of a relation of production.

Of course, Marx thought that only labour power could pass on to goods in the process of production more value than it contained. But this is generally false anyway (corn, steel or widget inputs can have this property too) so surely a fortiori where monkey or robot labour power is concerned.

Monkeys of the world unite, you have nothing to lose but you nuts, you have a banana to win!


Laurie Paul 09.10.04 at 2:39 pm

Monkey hate clean.


dsquared 09.10.04 at 3:35 pm

Is the thought that monkeys can’t own themselves? Well neither can slaves and they are sure as hell part of a relation of production.

Well the idea was partly that monkey’s can’t make contracts (I checked with a lawyer) and partly that slave labour isn’t part of surplus-value, because surplus only exists under capitalism. But I may have some of the details wrong; in particular, it might be possible to have primitive accumulation of monkey labour.


dsquared 09.10.04 at 3:39 pm

I’ve also just looked in the index of Piero Sraffa’s “Production of Commodities by Means of Commodities”[1]. There’s nothing under “M” for “monkeys” or under “R” for robots, so this may be a quite intractable problem in value theory.

[1]Of course I haven’t, what do you take me for?


scott mclemee 09.10.04 at 3:46 pm

This discussion is never going to get serious until we do an Althusserian reading of “Theories of Surplus Value” and produce the concepts necessary to deal with Engels’s “The Part Played By Labour in the Transition from Ape to Man.”

I spent all my time arguing this during the 1980s, until even the Spartacists begged me to shut up. But damnit, rigor counts for something.


Kevin Carson 09.10.04 at 3:52 pm

Rather than government programs to “cushion the blow” of globalization, how about just not subsidizing it in the first place? Producing stuff overseas is artificially profitable because of all sorts of government intervention to externalize the cost on the taxpayers. For example, foreign aid and World Bank loans subsidizes the infrastructure that’s necessary for overseas investment to be profitable. Massive transportation subsidies make it artificially cheap to ship the stuff back home. Political support for anti-labor regimes, and military intervention to protect the interests of capital abroad, are also parts of the equation–American capital should be fully internalizing all the costs and risks of investment, including the political ones.

As for the robot thing, robot labor doesn’t create any value at all. Human labor creates exchange-value because of its disutility. Robot “labor” is merely a use-value. It’s exchange-value comes entirely from the embodied labor in it, and from scarcity rents charged by those who control access to it. Like a lump of coal, a robot doesn’t have to be persuaded to contribute its “services” to production. A robot doesn’t drag itself out of bed every day and groan about another day working in that shithole to pay its rent.


Chris Bertram 09.10.04 at 4:03 pm

Monkeys “can be hanged for spying for the French”: , so I’d have thought a mere contract was well within their capacities.


Kieran Healy 09.10.04 at 5:41 pm

A robot doesn’t drag itself out of bed every day and groan about another day working in that shithole to pay its rent.

“Au contraire”:


abb1 09.10.04 at 7:26 pm

That is, suppose that the U.S. stays stagnant, but China and India learn how to do everything that we know how to do. Then they will no longer export cheap goods to us, and we will lose. This, they claim, is what Samuelson’s theoretical paper describes. If so, then it does not really describe outsourcing.

We all know what ‘outsourcing’ is: US-based companies hiring foreign workers, cheap foreign labor. So, China and India don’t need to “learn how to do everything” – US companies already know how to do everything. Pertty much any job outside of a few basic trades (like hairdresser, plumber, garbage collector) can be outsourced. And, unless the exchange rates change dramatically and make the US labor cheap, eventually every job will be outsourced, because there is no reason to hire a more expensive worker. Will ‘we’ lose? Shareholders will win and workers will lose. That’s what Greenspan means when he says that there will be winners and losers.


John Quiggin 09.11.04 at 6:03 am

I’ve been ordered to take you down to the bridge. Here I am, brain the size of a planet and they ask me to take you down to the bridge. Call that job satisfaction? ‘Cos I don’t.

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