As far as I understand: Price tries to measure value. Therefore: A price needs a value, but value doesn’t need price. They correlate but are not the same.
This is probably where your misunderstanding is, and it is the justification Adam Smith gives for the free market. If price is a measure of value (or an approximation), then the price must be fair (after all, you are paying for an equivalent of use value).
Marx evaluates price and value differently. He delineates ‘real price’ (the price to produce a good, including costs to the capital owner and the cost of labor) and ‘market price’ (which includes the profit extracted). He also defines value differently - Smith argues value is mostly subjective (which is a necessary condition for price to be a measure of value), while Marx argues that value is more specifically related to the labor that goes into it and the use-value, and criticized capitalist systems for fetishizing commodities and obscuring the role of labor. To Smith (and to those who take issue with the ‘labor theory of value’), value justifies the price (it is the price a buyer is willing to pay if they were perfectly rational), but to Marx, the use value is more firmly grounded in the commodity itself (a shovel produces the same amount of use-value whether it is sold for $5 or $25), and the market price they end up paying is dictated more by other factors than the value it represents. The capital owner, then, is adding to the cost to the buyer without adding to the ‘use value’ , which means they are either stealing from the laborers (since the product exists thanks to the labor that produces it) or the purchaser (who is being taken advantage of by paying more for a product than what the product’s use-value is). In either case, the owner is only able to do this by virtue of their ownership - of the means of production and the product of the laborers. They only part they play is choosing to put their capital to use and choosing to sell the commodity, and both the labor and the buyer operate at the risk of the capital owner withholding what others have produced (the buyer needs goods to sustain, and the laborer needs wages to purchase goods to sustain, but the capital owner puts their capital to work only to make a profit)
TLDR - People incorrectly associate LTV with Marx, even though other proponents of capitalism also make heavy use of it (namely Adam Smith), and they also assume that LTV is a statement about the price of a commodity dictated by the labor it embodies (e.g. I moved this boulder 200 miles, who is going to pay me for my value?) and instead it is a description of labor’s relationship to value and is generally agnostic to the degree. It is, as you said, a framework for understanding how labor relates to value. While ‘stolen surplus value’ is explicitly a marxist statement, ‘labor theory of value’ is not, and is often misunderstood anyway as a way of dunking on something marx does not assert.
a shovel produces the same amount of use-value whether it is sold for $5 or $25
Not disagreeing with anything you said, but use-value is a qualitative property of a commodity, not quantitative, so we can’t speak of an “amount of use-value”, AFAIK.
True, and I think this is the point of contention that underlies the discussion. Currency is a stand in for exchange value, which is meant to be a zero-sum representation of ‘value’. The ‘transformation problem’ only exists as a need to reconcile that desire to quantify what is (IMHO) a fundamentally unquantifiable thing. Just ask yourself “what is the value of my own life”, and feel the humanity drain from you as you ponder the arithmetic.
The video this person is referencing critiques LTV through the lense of modern economics, which is built on quantifiable exchange values. I can’t speak to Marx’s intent, if he was trying to ‘prove’ a calculation for value and labor’s objective contribution to it (I read Capital through a metaphysical lense, maybe that was wrong of me), but I find this need to rationalize price values objectively to be a waste of time.
If a pragmatist heard this conversation, they’d be asking “what do you precisely mean by ‘value’?” To quote William James:
There can be no difference anywhere that doesn’t make a difference elsewhere - no difference in abstract truth that doesn’t express itself in a difference in concrete fact and in conduct consequent upon that fact, imposed on somebody, somehow, somewhere and somewhen. The whole function of philosophy ought to be to find out what definite difference it will make to you and me, at definite instants of our life, if this world-formula or that world-formula be the true one.
What a mess we’ve made.
As far as I understand: Price tries to measure value. Therefore: A price needs a value, but value doesn’t need price. They correlate but are not the same.
Were am I making the mistake? Genuine question.
This is probably where your misunderstanding is, and it is the justification Adam Smith gives for the free market. If price is a measure of value (or an approximation), then the price must be fair (after all, you are paying for an equivalent of use value).
Marx evaluates price and value differently. He delineates ‘real price’ (the price to produce a good, including costs to the capital owner and the cost of labor) and ‘market price’ (which includes the profit extracted). He also defines value differently - Smith argues value is mostly subjective (which is a necessary condition for price to be a measure of value), while Marx argues that value is more specifically related to the labor that goes into it and the use-value, and criticized capitalist systems for fetishizing commodities and obscuring the role of labor. To Smith (and to those who take issue with the ‘labor theory of value’), value justifies the price (it is the price a buyer is willing to pay if they were perfectly rational), but to Marx, the use value is more firmly grounded in the commodity itself (a shovel produces the same amount of use-value whether it is sold for $5 or $25), and the market price they end up paying is dictated more by other factors than the value it represents. The capital owner, then, is adding to the cost to the buyer without adding to the ‘use value’ , which means they are either stealing from the laborers (since the product exists thanks to the labor that produces it) or the purchaser (who is being taken advantage of by paying more for a product than what the product’s use-value is). In either case, the owner is only able to do this by virtue of their ownership - of the means of production and the product of the laborers. They only part they play is choosing to put their capital to use and choosing to sell the commodity, and both the labor and the buyer operate at the risk of the capital owner withholding what others have produced (the buyer needs goods to sustain, and the laborer needs wages to purchase goods to sustain, but the capital owner puts their capital to work only to make a profit)
TLDR - People incorrectly associate LTV with Marx, even though other proponents of capitalism also make heavy use of it (namely Adam Smith), and they also assume that LTV is a statement about the price of a commodity dictated by the labor it embodies (e.g. I moved this boulder 200 miles, who is going to pay me for my value?) and instead it is a description of labor’s relationship to value and is generally agnostic to the degree. It is, as you said, a framework for understanding how labor relates to value. While ‘stolen surplus value’ is explicitly a marxist statement, ‘labor theory of value’ is not, and is often misunderstood anyway as a way of dunking on something marx does not assert.
Not disagreeing with anything you said, but use-value is a qualitative property of a commodity, not quantitative, so we can’t speak of an “amount of use-value”, AFAIK.
True, and I think this is the point of contention that underlies the discussion. Currency is a stand in for exchange value, which is meant to be a zero-sum representation of ‘value’. The ‘transformation problem’ only exists as a need to reconcile that desire to quantify what is (IMHO) a fundamentally unquantifiable thing. Just ask yourself “what is the value of my own life”, and feel the humanity drain from you as you ponder the arithmetic.
The video this person is referencing critiques LTV through the lense of modern economics, which is built on quantifiable exchange values. I can’t speak to Marx’s intent, if he was trying to ‘prove’ a calculation for value and labor’s objective contribution to it (I read Capital through a metaphysical lense, maybe that was wrong of me), but I find this need to rationalize price values objectively to be a waste of time.
If a pragmatist heard this conversation, they’d be asking “what do you precisely mean by ‘value’?” To quote William James: