No, I am not claiming that "Marx's economic model doesn't pertain to the current economy of the world", that is a complete misreading of what I said. Nor did I say that "Marx's model didn't handle non-manufacturing aspects of the economy". That is another crude Marxist falsification of my position.
I wasn't really talking about Marx, but about most Marxists and Keynesians, and that is a huge difference. Most Marxists and Keynesians have screwed up Marx's though so badly that it is very difficult now to state what Marx originally said and meant, since nobody will believe it. In most Marxist thought, "the economy" = "production" = GDP. This idea has its origin in the fact that when Marx wrote Das Kapital, he was primarily interested in explaining the workings of the capitalist mode of production (how the power of capital gets to dominate production, and changes it to suit the requirements of the accumulation of capital, and what all that means for the working class on a daily basis and in the long term). Das Kapital was never intended to be a total theory of the whole capitalist economy or of the whole capitalist society. Nevertheless, it has usually been interpreted as such. It is true, that Marx does look abstractly at the interactions between money capital, commodity capital and production capital in the second volume (the circulation of capital), and that he considers bank capital, commercial capital and rentier capital in the third volume, but all this is done only "from the point of view" of capitalist production. He says explicitly, for example, that he will not deal with the credit system in its entirety, and only look at how it impacts on capitalist production. Similarly for example he doesn't deal with housing or with public finance. His models only feature two or three output sectors. Most Marxists are basically only interested in the economic data, in order to show that the rate of profit is falling. The rate of profit has to fall, and if it isn't falling, then you fiddle around with the measures, until you get a good clear fall. But I was interested in all the questions which most Marxists do not look at, such as the composition of total social capital, investment patterns and accumulation patterns, which you can investigate using SNA/NIPA, BoP and FoF data sets. One of the questions I was looking at for example was, to what extent you could say that the net additions to the capital assets in rich countries were the product of domestic production, and to what extent they were the result of net imports. If, for a simple example, the domestic net fixed stock increases faster than domestic net fixed investment, how can you explain that? Is it an artifacts of measurement, or is it real, and if it is real, what is the most likely source? Most Marxist bureaucrats just want to split the workers into "productive and unproductive" classifications, but what interests me is the real evolution of the social and technical division of labour, and how that is linked to quantities of capital. In other words, then you have to bring together labour force data and asset data. Etc. The economic data typically does not permit very exact answers, because there is lots of error in the estimates for all sorts of reasons, but the data can often give you a reasonable indication of proportions, of the magnitudes that are of interest. And it can often tell you if the general trend is up, or down. That sort of research is important to do at times, since otherwise you start to confuse a mountain with a molehill, which can be easy to do. For example, in recent years the economists were screaming about the "debt-to-GDP ratio" but they have no understanding of the total debt structure, nor of the financial economics of debt. All you get is crude propaganda about trillions of dollars of debt that is unsustainable etc. It is only if you start looking at the data in more detail, that things begin to make more sense. J.
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