Jim doesn't want our very civil offlist exchange on the list so i'm just sending my reply especially because i want to share the quote with which i end:
Constatin Pecquer, 1839: "One fact is certain, general...it is the silent but very decisive struggle of the workers against their masters with a view to forcing the captains of industry to raise their wages... "How can one not see that to leave [the wage earners] dependent on the insufficiency of a fluctuating wage is to wish to find oneself surrounded in times of crisis and general unemployment by a famished multitude, to create riot and civil war, and perhaps to arm new Spartans..." __________ Marx didn't write the book on the state, so it's up to us to figure out what a value theoretic based view of the state would be and then to determine whether such a theory is illuminating, right? I refer to Mattick because he saw himself working out exactly this--a strictly value theoretic analysis of state deficit spending. yes but that implies that govt bonds are directly fictitious. That is, the state borrows sum of money and then buys arms or hires people to buy roads. That value which the state has borrowed has now been pulverized in the sense that it will not itself expand. The road may however encouage more investments in car and truck making. NO MARX does not refer to an immediate crowd out effect. HE DOES NOT SAY THAT MONEY BORROWED BY THE STATE WOULD HAVE OTHERWISE BEEN INVESTED BY THE PRIVATE SECTOR. But my point is that deficits do not necessarily increase the size of the surplus value or necessarily encourage entrepreneurs to make investments that they wouldn't have otherwise. I think Marx does have multiplier and accelerator effects in vol 2 from private investments, but this is a good question, and i am excited to stick my head back into vol 2. the problem is that radical keynesians do not entertain the possibility of fiscal policy inadequacy. it's always a matter of pushing for more intervention or a different kind of policy mix. even the radical keynesians are bourgeois: they believe that the state can set things right even if idle money and productive capital are left in private hands. if you want to read a real inflationist deficit spending fanatic, check out george gilder who wants interest rates to go ever lower, no matter the effect on the retired, and defense to be ever stregthened, no matter the effect on world peace. While taxes on capital are ever reduced even if that is irrational from an efficient stimulus point of view as the Kaleckian John Foster has very interestingly argued. People like Sweezy and Foster accept the technical validity of Keynesian economics but do not think the state can be used *given the political balance of class forces in a monopolized capitalism* to mediate the conflict between property owners and the property less. Constatin Pecquer, 1839: "One fact is certain, general...it is the silent but very decisive struggle of the workers against their masters with a view to forcing the captains of industry to raise their wages... "How can one not see that to leave [the wage earners] dependent onthe insufficiency of a fluctuating wage is to wish to find oneself surrounded in times of crisis and general unemployment by a famished multitude, to create riot and civil war, and perhaps to arm new Spartans..." Rakesh
