more light on a dark subject - part 1

LI has has a good time reading some of the contributions to the Spivak fest being hosted on LS. In particular, if you have time, the Naked Gaze blog (another we have to totally put on our blogroll – we are totally behind on that project, sorry sorry sorry!) gives a nice history of the triangle, Spivak, Derrida, Marx (not exactly as cinematic as Jules et Jim, but what the hey). NG does one of those Derrida things, which Derrida got from listening to five year olds on swing sets – he repeats a set phrase over and over. In NG’s case, the phrase is: "Writing at speed". As the five year old discovers, this is a good way to induce vertigo – to disturb the rigid separation of sound and sense. And it works best with words that are odd words anyway, like your name, or the name of the sister you are trying to torment. Which is the point, although exemplifying that point treads a thin line between art and bugging the shit out of the reader.

That I bring in kids to talk about deconstruction, is not, by the way, a sneaky way of jabbing at J.D. Why do you think this site is named Limited Inc? When Marx’s friend Kugelman pointed out that the forms of value theory in the first edition of the first volumen of Das Kapital rather confused some people, namely some unnamed review, Marx sent him a famous letter (English and German in which he implied that, really, a child could understand it:

„... when we conceive by Value something in general, we must concede my conclusions. The unhappy man doesn’t see, that, if in my book there is no chapter on Value, the analysis of the real relationships that I give contained the proof and reference to the real relationships of value. The nonsense talked about the necessity of proving the value concept rests only on the most complete ignorance, as much about the subject matter that it deals with as the method of science. That any nation would kick the bucket if labor halted for, I won’t say a year, but merely a couple of weeks, any child knows. Just as they know that the different quantities of need corresponding to quantities of products require different, quantitatively determined amounts of collective social labor. That this necessity of the distribution of social labor in specific proportions is not suspended through the specific form of social production, but instead, only its manner of appearance changes, is self evident. Natural laws cannot, in general, be suspended.“ (I’ve retranslated bits of this)

Well, it is a wise child that knows his forms of value. One wonders if Kugelmann’s eyes got a little wide at this evocation of the toddler economist. Mill says something quite similar in his own Principles of Political Economy:

“The conditions and laws of Production would be the same as they are, if the arrangements of society did not depend on Exchange, or did not admit of it. Even in the present system of industrial life, in which employments are minutely subdivided, and all concerned in production depend for their remuneration on the price of a particular commodity, exchange is not the fundamental law of the distribution of the produce, no more than roads and carriages are the essential laws of motion, but merely a part of the machinery for effecting it. To confound these ideas, seems to me, not only a logical, but a practical blunder. It is a case of the error too common in political economy, of not distinguishing between necessities arising from the nature of things, and those created by social arrangements.”

Further down in the letter, Marx says something that is rather erased in the standard translation: „The vulgar economist hasn’t the least idea that the real, daily exchange relationship and the value magnitudes cannot be directly identical. The wit [Witz] [not essence, or Wesen, as you will find in the English version] of bougeois society consists exactly in there being apriori no conscious social regulation of production.“

A remark which justly brings out the fact that problems of value haunt all economics schools. What value is is connected to how economists see their discipline: one in which there is an underlying, always arousable anxiety about its scientific status.

A famous exercise in the transvaluation of all values in orthodox, neo-classical economics is contained in a very sleek paper published in the nineties by William Nordhaus. Nordhaus’ paper is neat -- if one takes a deconstructive view -- partly because of what he does in it, and partly because his subject matter is shot through with scientific anxiety. The subject matter is the price of light. Specifically, the price of light since the invention of fire in the paleolithic age down to the halogen lamp.

Light, of course, is the supreme object of the supreme science, physics. The book I am translating by Silja Graupe demonstrates, with infinite care, following in the footsteps of Mirowski, how very much the economists of the 19th century, especially the founders of the marginal revolution, used physics as their base analogy for the creation of the central equilibrium model. And Graupe shows just how wrong the analogy is. Shelley, long ago, saw through the scientific armature of „political oeconomics,“ the maniac search for equivalents and variables, to the poetry at its core:

“We have more moral, political and historical wisdom than we know how to reduce into practice: we have more scientific and œconomical knowledge than can be accommodated to the just distribution of the produce which it multiplies. The poetry, in these systems of thought, is concealed by the accumulation of facts and calculating processes. There is no want of knowledge respecting what is wisest and best in morals, government and political œconomy, or at least what is wiser and better than what men now practise and endure. But we "let I dare not wait upon I would, "like the poor cat in the adage".”


Economics has few real jokes (Witz), but one of them is all about light: Bastiat’s little satire on the petition of the candle makers. It is an essay that still causes the port to shake in the glasses round the table at the University of Chicago. In fact, in 1868, Marx was writing about Bastiat. Nordhaus quotes the satire in his essay. It begins: “We are subjected to the intolerable competition of a foreign rival, who enjoys such superior facilities for the production of light that he can inundate our national market at reduced price. This rival is no other than the sun.”

Although it might seem a little odd to go from a reading of Das Kapital to the material concomitant of reading Das Kapital (myself, I have read it by 60 watt bulb, by florescent bulb, and even by halogen bulb, but not by gas or candle, by the light of which it was undoubtedly written), Nordhaus’ essay is in its own way a critique of the political economy that also seeks to ground economics in science. Light has the advantage of being a standard, a measure that is at the basis of other measures. So, Nordhaus ingeniously maintains, if we can look at the price of light down the millennia, we can get a sort of photographic negative that tells us about technological progress down through the years. And if we find that the prices, as they are computed in standard economics, do not give us this negative, then we have a good basis for recomputing those prices. Which (warning: Plot Giveaway) is just what Nordhaus finds. In fact, Nordhaus and his colleagues who advocated hedonic pricing to better reflect technological change won over a crucial player in the nineties economy, Alan Greenspan. LI won’t discuss, here, the way that Greenspan’s self interest in papering over inflation and the hedonic school’s insistence that qualitative change on a number of dimensions has to be reflected in the price index – that the prices have to be, oddly, hedonic prices – met in the mid nineties and allowed Greenspan to keep down interest rates when, according to traditional indicators, he should raise them (which James Galbraith rightly said was the best thing Greenspan did) – all of this is a well known story.

But … back to the charms of Nordhaus. One of the most charming things about the paper is the slightly mad Newtonian fervor in it. For instance: Nordhaus says that the earliest market for lighting fuel arose in Babylon, about 3000 B.C. At that time, the Babylonians were using sesame oil to light their lamps. Now, your average Babylonian laborer earned about one shekel a month. And Nordhaus figures that if that monthly earning was spent just on lighting, it would buy ten liters of sesame oil. BUT: big question: how much lighting power would it buy? Since, happily, physics has given us our standards of illumination, Nordhaus does a little experiment. He buys a terra cotta lamp – not Babylonian, but Roman, which doesn’t make too much difference, insofar as lamp technology had not progressed too far at this point – from Spirits, Inc, of Minneapolis Minnesota, which guarantees the provenance. He fills it with 100 percent pressed sesame oil and uses a wick from a modern candle. He found that one quarter cup burned for 17 hours with an average intensity of 0.17 foot candles.

I totally love this.

END OF PART 1