With the following quote from Karl Marx taken from "Wage, price and profit", a transcript of the lectures he gave in 1865 in the framework of the First International, my recent book begins entitled "General theory of prices, wages, production and money in economic warfare ":" The values of basic necessities and consequently, the value of labor may remain unchanged and, nevertheless, the money price of those may suffer an alteration due to a prior change in the money's value.
With the discovery of more abundant deposits etc., two ounces of gold, for example, would not cost more work than previously required the production of one ounce. In this case, the value of gold would fall by half, or 50 percent. And since, as a consequence, the values of all other commodities would be expressed at twice their previous money price, this would be extended also to the value of work. The twelve hours of work that were previously expressed in six shillings would now be expressed in twelve.
Therefore, if the worker's salary remained at three shillings, instead of rising to six, it would result that the money price of his work would only correspond to half the value of his work, and his standard of living would deteriorate frightfully. And the same would happen to a greater or lesser degree if his salary rose, but not proportionally to the decline in the value of gold. In this case, not the slightest change would have taken place, neither in the productive forces of labor, nor in supply and demand, nor in values.
Nothing would have changed less the name in money of these values. To say that in this case the worker should not fight for a proportional increase in his salary, is equivalent to asking him to resign himself to having his work paid in names and not in things. All the history of the past shows that whenever such a depreciation of money occurs, the capitalists are quick to take advantage of this conjuncture to defraud the workers. "
Marx's interventions at this conference focused on refuting the approaches of John Weston who opposed wage increases because, according to him, they would lead to price increases.
These approaches are in force in Venezuela by those who, with reformist positions and monetarist arguments full of contradictions, try to justify the non-adjustment of wages in the face of hyperinflation that has been criminally induced in the framework of an economic war against the Venezuelan people by of imperialism. In the heat of this debate that is taking place in the streets, factories and jobs, we have written this book.
Our approach is centered on the need to recognize that a fourth agent is present in the economic dynamics, whose participation in the markets serves political and war objectives, who has sufficient power to break the equilibrium creating a scenario of permanent destabilization. All the currents of economic thought, classical and neoclassical, including Marxist, only recognize three agents that interact in the markets, namely, the demanders, the suppliers and the State. In the book we show theoretically and empirically that a fourth agent operates, imperialism.
The value of money is the axis around which the statements presented in the book revolve. Its variation, manipulated by this fourth economic agent, is the determining factor of what has been happening in Venezuela with prices, wages and production. Drawing on Marx's theory of labor and money, we highlight the difference between the function of money as a measure of value and as a standard of prices. It is precisely in the recognition of this difference that the key lies in understanding how this fourth agent affects all commodity prices and unleashes an economic and therefore political destabilization. We dedicate a good part of the book to answering the question that, in our view, is crucial, on what does the value of money depend in our times? Particularly after 1971 when the US unilaterally decided to get rid of the gold standard as a benchmark for the value of money to base it on “trust”. So we ask ourselves, how do we measure trust?
In the book we dismantle, theoretically and empirically, the following arguments of monetarist economists, which we do based on their own quantitative theory of money and their own postulates, highlighting their contradictions due, many of them, due to the circular reasoning in which they incur: 1) to increase wages we must first increase production; 2) the amount of “inorganic” money cannot be increased to increase wages because it would generate hyperinflation; 3) the depreciation of the bolivar is a consequence of the increase in the amount of “inorganic money”; 4) the fall in national production is a consequence of the decrease in worker productivity, you have to work harder; 5) the financing of the “fiscal deficit” with the “inorganic” money machine is the cause of inflation; 6) it is necessary to encourage and give concessions to private capital, if they are foreigners better, to increase production; among others.
In the book we characterize the economic situation and explain the causes of the 74% fall in national production between 2013 and 2020, the increase in prices by 60 billion percent during the same period, the pulverization of the real wage by 99% and the “depreciation” of the bolivar 3,1 trillion percent since 2013.
We draw in the book the class struggle that we are waging in Venezuela that is clearly manifested in the capital-labor contradiction and in the increasingly unequal distribution of national production between profit and salary. We propose and explain in detail the indexing of the economy as a strategy to neutralize the effects of imperial attacks.
The book, which is dedicated to the Venezuelan working class and written with the scientific rigor that the debate of ideas in revolution demands of us, but with the simplicity of language as they are topics of interest to all working people, complement it in an extraordinary way. the presentation by Professor Julio Escalona, the foreword by Professor Julio Gambina and the review made by Master Luis Britto García. An honor for me to have these three views on the book.
I thank Editorial Trinchera for the confidence shown since I raised the possibility of publishing this work, which we will present this next Wednesday, July 21 at 10:00 am at the Colombeia Bookstore located in the center of Caracas, in the Palacio de las Academies.
We humbly hope to contribute with this book to the public debate, we refer to the serious and respectful debate that results in the collective construction of proposals to combat and neutralize that fourth external agent of the economy, imperialism, in order to continue advancing towards the dream of a just, humane and socialist world.