Feb

23

Since Eddy and her mother abandoned me for the pleasures of visiting Charlotte and Charleston this weekend, I have had to amuse myself with reading Marx and Engel's (mostly Marx's) dispatches to the New York Tribune. Poor man; if only he had lived a century or so later, I am certain he would have been able to win the Nobel Prize AND write for the Times.

It is fascinating how much Marx despises the man who gave him and Engels their claim to fame. David Ricardo's assertion that profits and wages inexorably contend with one another is surely the basis for the Marxist's "labor theory of value". Yet neither revolutionary author has even a single kind word to say about the first great English-speaking practical speculator. Neither, for that matter, does Wikipedia. One wonders why. Ricardo was an abolitionist, he opposed the Corn Laws and favored an expansion of trade as the only means by which the poor could escape permanent destitution.

There are only two explanations that I have come up with in a weekend's reading of MarxEngelian journalism (which could, with a few changes of names, easily be reprinted as commentary on the current "Greek" crisis. One, Ricardo was truly at home with international finance and counting; his father was a stockbroker, his sister a mathematician and his family, through its religious connections, had ties with Holland and Portugal. In an age when nationalist rivalries, religious bigotries and Marxian envy were as stupidly persistent as they are now, Ricardo's 19th century liberal belief in freedom and enterprise was an insult to both Right and Left. The other explanation is that Ricardo at the end of his life (he died in 1823) was abandoning the very idea of "value" that was to dominate the ideologies of economics itself. The longer he worked on the idea of labor as the basis of value, the more he came to see it as a theological question that had no practical meaning. There were only prices expressed in currencies; and markets were the only free way of setting those prices.

We are, yet again, at that lovely point where the official Left and Right can come to agreement. How can the Greeks, who are clearly unable to pay the debts to themselves, let alone those to other nations and entities, be allowed to declare bankruptcy? Unthinkable in the minds of anyone whose opinions are likely to be heard on the subject. In the great game of central bank cold warfare, such a surrender to the speculators would be an absolute heresy. Leaving Greek enterprise and labor to find their best prices would be anarchy. Leaving the discounting of the various monies used to price that enterprise and labor and "capital" would be absolute anarchy. Everybody with a proper education knows that the fluctuations of credit can be restrained; it simply requires wise administration by people with the authority to own the means of production or regulate the measure of capital (choose One).

Whatever the current solution to the crisis of "Grexit", the end resolution remains the same: default by the borrowers and– depending on their perceived leverage– large or small trouble for the lenders.


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