Estimation of Costs in a Post-Capitalist Economy

Discussion

By "Les Amis de 4 Millions de Jeunes Travailleurs":

"One might be tempted to conclude that, with the disappearance of money, communist society will no longer have to regulate costs, and that it will not have to calculate the value of things. This is a fundamental error.

The fact that a good or service is distributed free of charge is one thing. The assertion that this costs nothing is something else entirely. This illusion is a direct legacy of the functioning of the commodity system. We are accustomed to identify cost with payment. We only see the payment, the monetary expenditure. We overlook the expenditure in effort and materials that gave rise to the product in the first place.

In capitalism as well as in communism free distribution is not equivalent to the absence of costs. The difference between communist free distribution and capitalist free distribution is that the latter is merely a semblance of free distribution; in the capitalist version, payment has not been eliminated, but has simply been deferred or shifted to another party. The fact that education and advertising are free does not mean that they are external to the commodity system and that the consumer does not ultimately pay for them. The freely distributed commodity is a very perverse thing. It implies an imposed or semi-imposed consumption, and hinders our ability to make choices and to refuse what is “offered” to us.

In the new society the cost of things will have to be ascertained and if necessary calculated in advance. Not because of a Manichaeism of accounting procedures or to avoid fraud, which will no longer have any reason to exist. It will be done in order provide the framework for deciding whether the particular expense incurred was justifiable, and to reduce it if at all possible. There will have to be an effort to assess the positive and negative effects on the human and natural environment of the satisfaction of a need or the implementation of a new project.

A needle, or a car—are the time and the effort devoted to their production as well as all the concomitant social costs of their use justified? Is it better to build a production facility in this location or somewhere else? Is a certain production process justified in consideration of its utilization of finite mineral resources? One cannot leave such things to chance or intuition. It is easy to see that all of this implies evaluation, calculation and forecasting.

If we retain the notion of cost, which is so redolent of economism, this is because it is not simply a matter of choice and measurement, an intellectual process, but a physical expenditure. Regardless of the technical level there will be activities that are more costly and jobs that are more arduous than others. It would be especially sad and strange if everything were to become easy and a matter of indifference in a communist society, even more so than it would be if this were to happen to other kinds of societies.

The commodity presents a double face: use value and exchange value. They seem to depend on two irreducible orders. Use value, or utility, depends on the qualitative. The user compares and evaluates the airplane and the orange, in order to decide which would suit him better. The choice cannot be made independently of his situation and his concrete needs.

Exchange value depends on the quantitative. Goods are all evaluated and objectively arranged in the framework of a single standard, whether the goods in question are airplanes or oranges.

Communism is not so much a world that perpetuates the realm of use value, finally liberated from the exchange value that parasitized it, as a world where exchange value is repudiated and becomes use value. Advantage and disadvantage come from the same order of things and are no longer either united or separated back to back. Value ceases to be value in order to reappear as concrete and diversified expenditure. Labor ceases to be the basis and the guarantee of value. There is no longer a single standard that allows for quantitative comparisons between all things, but concrete expenditures and labors, of various degrees of burdensomeness which should also be taken into account. Having ceased to perform its role as the basis of value unified by the exchange process, labor ceases to be LABOR.

“The bourgeois economy is a double economy. The bourgeois individual is not a man, but a trading company. We want to destroy all trading companies. We want to abolish the double economy in order to found a new one that is one single unit, which history already knew during the times when the cave man went to collect as many coconuts as there were comrades in his cave, with his hands as his only tools.” (Amadeo Bordiga, "Property and Capital", 1950)

Everything will be free because the “gift” will replace the act of selling. Those who carry out one or another kind of labor with the object of satisfying their own desires or being useful to others, will be paid directly by their own efforts.

Is this something new? No, since even today it never occurs to anybody to charge anyone else for the price of the saliva they used up in the course of a debate. In a conversation one does not exchange a certain time for speaking or a certain decibel level, one attempts to say what one has to say, because one feels that it has to be said. The interlocutor or the auditor does not owe us anything in exchange for their attention. Awaiting a response, the risk of running into incomprehension, silence, or the lie, are all part of the game. They are neither the expectation of payment nor the risks of the market. In everyday life the word is not a commodity; speaking is not a job.

What is true today of the word, when it is not recorded and sold as a commodity, will be true tomorrow for all of production. The estimation of the cost of production will no longer be distinct from the effort dedicated to its fulfillment. The very first step in this calculation will be the impulse that will lead towards this or that kind of activity. A book or a pair of shoes will be “offered” in the same way that words can be offered today. The gift implies, up to a certain point, reciprocity, the word implies the response, but this is no longer the anonymous and antagonistic process of exchange." (http://libcom.org/library/world-without-money-communism-part-two-les-amis-de-4-millions-de-jeunes-travailleurs)

Why Measuring Labor Time will not work

"The whole idea of using labor time as a standard of measurement is somewhat fanciful.

The idea of measuring all productive activities by the time they require would be like measuring and comparing all liquids only by their volume. It is true that every activity takes a certain amount of time, just as a particular liquid occupies a certain volume. This is not a trivial point. A one-liter bottle of water could instead contain a liter of wine. But no one would ever deduce from that fact that a bottle of water is always equal to a bottle of wine, or alcohol, or soft drink, or hydrochloric acid. Strictly speaking, only from the narrow point of view of the wholesale dealer would this make sense.

Time is the only objective language that can be used to express the creative force of the slave or the worker, from the point of view of the exploiter. This implies external measurement, control and conflict. The duration and the intensity of the activity are privileged above its nature and its particular difficulty, which become matters of indifference. The subjectivity of what is experienced is sacrificed in favor of the objectivity of the standard of measurement. Creation and life are forced to submit to production and repetition.

Measuring by means of time is older than the commodity system. Instead of providing a certain quantity of a particular product, the exploited put a certain amount of their time at the disposal of the exploiter: the labor services of the feudal era, for example. This procedure was especially developed in the system of the Incas, a great agrarian empire under the unified rule of a bureaucracy where money was unknown. The labor services were performed in the form of days of labor spent in one or another task. This required a very rigorous system of accounting.

In the peasant or rural communities, an individual spent one day harvesting the fields of another person and vice-versa. The peasant and the blacksmith bartered their products on the basis of production time. The activity of a child was valued as a portion of that of an adult. These practices can be seen as the beginning of the use of time as universal standard and even of the submission of the planet to the commodity economy; but only the beginning. These marginal practices were more of the order of mutual aid than of exchange. The activities subject to measurement were of the same or concretely comparable nature. Measurement by time was not yet independent of the content of what was being measured.

With the two-pronged development of the commodity system and the division of labor, measurement by means of time began to assume its fanciful character, becoming detached from the content of activity as the latter was diversified.

This process was accentuated when exchange penetrated into the sphere of production. Measurement by means of time developed in relation to the tendency of the economy to be based on labor time. The maximum amount must be produced in the least amount of time. The possibility to use time as a standard of measurement is inseparable from the compression of human activity within the smallest possible span of time. Not only did labor produce the commodity; the commodity produced labor through the despotism of the factory.

With this development, the practice of measurement by means of time lost its innocent airs, but was concealed behind money and justified by financial necessities.

Bourgeois ideologists, especially those who invoke Saint Marx, project this fetishism of time and production over all of human history. In their view, the latter is nothing but an incessant struggle for free time. If primitive peoples remained primitive this is because, dominated by their low level of productivity, they did not have the time necessary for the accumulation of a surplus. Time is scarce; one must concentrate into it the densest activity possible.

Instead of thinking only about how to save time, primitive peoples were instead busy with the most effective means of squandering it. These peoples often present the most indolent character. Besides the tools needed for hunting, they hardly sought to accumulate goods of any kind.

In the 18th century, Adam Smith renounced the attempt to base value on labor time with reference to modern times. But this labor-value did play a role, according to Smith, in those primitive societies where things were still relatively uncomplicated.

Imagine, if you will, some hunters who want to exchange among themselves the various animals they took in the hunt. Upon what basis can they do this, other than the basis of labor time, as a function of the time required to get the animals? This is the assumption made by an economistic and banker’s mentality when confronted by a situation where the rules of sharing and reciprocal bonds prevail.

Let us assume, however, that exchange already existed or that our primitive peoples decided to rationally employ their forces to acquire meat with the least expenditure of effort. Would they have constructed their system on the basis of necessary labor time?

There are pleasures and risks involved in hunting, concerning which the time employed in hunting is totally uninformative. What is the comparative value of a lion as opposed to an antelope, when considered on the basis of the duration of the hunt without reference to the different risks involved in each hunt? Certain modes of hunting may take more time but may also be more certain of success, less arduous, less dangerous, and more or less cruel.

If they still wanted to practice this type of measurement, could they do so? It is hard to evaluate with precision the time necessary to obtain this or that animal. By systematically hunting the most productive animals, from this narrow point of view, they would risk modifying the conditions and the necessary time for the hunt. In any event, one often goes out to hunt antelopes and comes home with rabbits. It is useless to predict the unpredictable.

Will we be told that this is no longer valid for our civilized epoch, and that the hunt is a very special case of productive activity? Let’s face the facts. It is the ubiquity of exchange that conceals reality. Measurement by means of labor time does not exempt us from the hazards of human existence or of the exhaustion of natural resources. These problems are not specific to primitive man but apply to all societies. Not acknowledged by the logic of capital they return with a vengeance….

Measurement by time only indirectly accounts for any repercussions on the environment and the difficulty of the activity concerned. Can it be used in communism by translating the transformation or destruction of a rural region, the exhaustion of a mine’s resources, or the production of oxygen in a forest, into its language? The inherent advantages or drawbacks of a production process will be reckoned in terms of the labor time that is virtually saved or virtually expended. It would surpass the absurdity of capitalism if it were to seek to consciously reduce use values and qualities to labor-values. What value does a stretch of countryside have? Should it be based on the expenditure that would be required to rebuild it from scratch? At this price, nothing would be worth undertaking.

To assess the different values of two labor processes of equal duration in which the risks or the discomfort of the jobs are different, do we have to find a single standard by which they can be compared? One hour of bricklaying would count as one and a half hours of carpentry. Let us say that the difference would be accounted for by the expenditure of time necessary to provide for the bricklayer, to wash his clothing … and we refuse to reduce everything to the expenditure of labor time, but then how can we establish the coefficients that express the differences in value or discomfort that distinguish the two jobs? Why, on the other hand, should we want to establish such coefficients when these differences depend on the conditions and the rhythm of the activities concerned and the inclinations of the participants?

When the workers take over, the advocates of measurement by time or remuneration as a function of labor time run the risk of being left behind. From the moment when activity ceases to be compulsory, its nature will change and its duration will be extended. The quantity and the character of production will no longer be evaluated with respect to the duration of the consumed labor. One person will produce enough in a little time, while another will take a long time to produce little. If remuneration were to be based on the time expended then we will need to have strict prison guards on the jobsite or we would soon be faced with an incitation to laziness.

Whether the workers will agree to guarantee a certain amount of production or devote a certain number of hours each day to productive labor, is a question of practical organization that is not directly pertinent to the determination of the cost of what they produce. In one factory it might take twice as long as another factory to produce objects of the same cost.

One can certainly speak of the social allocation of labor time at the community’s disposal, but one must not forget that time is not a material that one can dish out with a ladle. It will be men who will go to such and such a location in order to assume responsibility for such and such a task. From the moment when free time is no longer extraordinarily scarce and is not devoted to the satisfaction of absolutely vital needs, there will be some jobs that are more urgent than others, and men who work faster than other men.

With capital it is necessary to dissociate the price, the expenditure of labor power and what this expenditure contributes, and the labor that does not have any value. With communism this dissociation makes no sense. Labor power and labor, man and his activity, can no longer be separated.

This means, first of all, that there is no more surplus value, not even for the benefit of the community, or a new form of social surplus. One can no longer speak of accumulation or of expansion except in physical and material terms. To speak of socialist accumulation is an absurdity even if at any given moment more steel or more bananas are produced than before, even if more social time is devoted to production. These processes no longer assume the form of value or time employed.

As a result, this means that labor, which in capitalism has no value, acquires value in communism. This value that it acquires is neither moral nor monetary. This is not the apotheosis of labor but instead expresses its supersession.

Labor, the source of value, is not susceptible to numerical measurement. One can economize on it, but its identity is unquestionable. In communism this or that activity will no longer be distinguished from the effort made by the human beings who engage in it. Not all jobs have the same human cost. It is a matter of developing the least costly ones.

In capitalist society, if one shifts one’s perspective from that of capital to that of the worker, labor also has a cost; one job is preferable to another.

When night arrives one feels one’s fatigue or anxiety. But finally the differences are small. Labor is always considered time that is more or less lost. No one devotes any time to calculating boredom or health damage. For the worker the price of all of this shit is his wage. One already knows that it is a mystification and that the wage is not determined by the effort expended or the discomfort experienced.

The superiority of communism lies in the fact that is not content with the satisfaction of the needs of “consumption”. It applies its efforts to the transformation of productive activities, that is, to the conditions of labor. As a matter of principle, investment decisions will not be made on the basis of the economy of labor time, even if the possibility exists that the task can be expedited. These decisions will have the objective of producing the conditions in which activities can be enriched, favoring the most pleasant ones. The determination of the conditions of activity does not mean that the activity itself and the behavior of the producers themselves will be determined in advance. The producer will still be master of his activity, but he will act in certain conditions, within the framework of certain limitations that constitute the arena in which he can act.

The production by men of the instruments and the plan of production allow for this transformation of human activity. The development of technology can be oriented so as to be more or less favorable for the producers. This or that kind of machine or ensemble of machines could allow those who use them to experience less exhaustion and be less subject to a certain rhythm of production. Those characteristics that would allow men to be as free as possible can be systematically developed in the productive process.

Don’t tell us that personal preferences or subjectivity would objectively prevent any such choices. There are some things that do not change. We are not saying that the criteria must have a universal scope. They will vary according to the time and the situation. Men will make agreements to determine what suits them best. The diversity of personal preferences and the willingness to experiment can follow different roads in the context of a similar objective.

The estimation of costs cannot be reduced to the need to balance “income and expenditures”; equilibrium must be conceived as a dynamic equilibrium. Starting from the basis of the conditions inherited from capitalism, what is required is to give development a certain direction. Is the estimated cost of constructing a particular productive facility or way of life justified? Does the automation of this or that unit of production justify the efforts required for the fabrication of the automated machinery? The logic of the economy of labor time that serves as the organizing principle of the construction of situations in the capitalist world will yield to a different logic, a logic that is no longer external to the men that put it into practice. Humanity will organize and control the construction of situations in view of its needs. In this sense it will become situationist." (http://libcom.org/library/world-without-money-communism-part-two-les-amis-de-4-millions-de-jeunes-travailleurs)

Source

"Part Two of this three-part series, first published in 1975-1976, begins with a brief summary of the Marxist critique of money and the law of value and distinguishes between the “estimation of costs”—which will still be necessary in communist society—and capitalist value—which will be abolished completely; the authors reject social planning and remuneration based on labor-time quantities, speculate regarding the principles of communist production and distribution (calculation, estimation of costs, free distribution, etc.), and conclude Part Two with a long essay on politics, the state, the workers councils and democracy, among other things.

Communism is a world without money. But the disappearance of money does not signify the end of all evaluation of costs. The societies and human activities of the past, present and future are necessarily faced with this problem whether or not they use monetary symbols. The criteria selected for these evaluations obviously vary according to the essential nature of the society in question." (http://libcom.org/library/world-without-money-communism-part-two-les-amis-de-4-millions-de-jeunes-travailleurs)