Exordium

A specifically bourgeois economic ethic Max Weber, the Protestant Ethic and Neoclassical Economic Theory

What the great religious epoch of the seventeenth century bequeathed to its utilitarian successor was, however, above all an amazingly good, we may even say a pharisaically good, conscience in the acquisition of money, so long as it took place legally. Every trace of the deplacere vix potest has disappeared. A specifically bourgeois economic ethic had grown up. With the consciousness of standing in the fullness 176 of God's grace and being visibly blessed by Him, the bourgeois business man, as long as he remained within the bounds of formal correctness, as long as his moral conduct was spotless and the use to which he put his wealth was not objectionable, could follow his pecuniary interests as he would and feel that he was fulfilling his duty in doing so. The power of religious asceticism provided him in addition with sober, conscientious, and unusually industrious workmen, who clung to their work as to a life purpose willed by God.

In this telling passage from the last chapter of Webers Protestant Ethic dedicated to Asceticism, the great German scholar draws a clear and unmistakable link between the worldchanging emphasis of the Protestant faith on work or labour (Arbeit) as the road to salvation and its manifestation or reward in the outward signs of material wealth and success the light cloak that nefariously turns into an iron cage. Yet in tracing this link between the Protestant Ethic and the Spirit of Capitalism and then designating the former as a specifically bourgeois economic ethic Weber unwittingly inverts, or more accurately reverses, the real content of what truly constitutes the specificity of this bourgeois ethic. The aim of this piece as intrepid, I believe, as it is original is to show that the Protestant Work Ethic, though it certainly played a historical role in the rise of the Spirit of Capitalism, most certainly could not provide a logical coherent foundation for a specifically bourgeois economic ethic, and was in fact in complete opposition to and even in contradiction with such ethic. By so doing, we hope to provide a revealing original interpretation and critique of the worldview introduced by the negatives Denken a worldview that, whilst in strident opposition to the universalistic claims of Western metaphysics and theology, has come to dominate implicitly, though not explicitly, the science and ideology of global capitalism. Our thesis here is that the Protestant Work Ethic retains the Christian and Scholastic genes of mediaeval theology and jusnaturalism (Latin, jus naturale, Natural Law theory) that will ultimately form the foundations of Classical Political Economy and of the Labour Theory of Value both of which are emphatically antithetical to any version of a specifically bourgeois (and capitalist) economic ethic. The real, true and canonic bourgeois economic ethic indeed, an entire imponent metaphysics is and could only be constituted by what has come to be known as neoclassical economic theory, a theory that from its early beginnings in the middle of the nineteenth century on the back of Hobbesian and Lockean possessive individualism and then through its direct predecessor, the negatives Denken initiated by Schopenhauer, has come to dominate and permeate the entire one-dimensional uni-verse of bourgeois orthodox economic

science. We characterize this philosophical and socio-theoretical current, immensely influential to this day - though this is far from obvious to even the most perceptive scholars in economics especially - as negatives Denken or negative thought. The meaning of this description will become apparent in the course of our exposition as we trace the salient aspects of the negatives Denken with special reference to the field of economic theory as expounded and articulated by Neoclassical Theory. For although in the worldview of the negatives Denken labour can consume existing wealth or nature to provide for individual wants when it comes into contact with this nature, it can by no means create or produce greater wealth to satisfy or provide for human wants unless this labour can be made more productive by capital. Aphoristically put, one might say that for the Protestant Ethic and for the Labour Theory of Value production leads to greater wealth and possessions by means of labour understood as penitence (toil and abstinence or parsimony) whereas for the negatives Denken it is the renunciation of present consumption that leads to future accumulation through the diversion of labour to the production of capital. The essential feature that the Protestant Ethic and the negatives Denken have in common is that for both labour is sacrifice and penance or toil and effort: yet the all-important difference is that for the first labour pro-duces greater wealth, regardless of whether this wealth is then saved or consumed, whereas for the second this is impossible given the essence of labour as want or provision for want, and only the renunciation of consumption, the conquering or sublimation of want, and therefore the suppression and extinguishment of the Arbeit can lead to the accumulation of wealth provided that this renunciation is devoted to the production of labor-saving tools and ultimately of exchange values. We wish to demonstrate here that whilst Neoclassical economic theory and a fortiori the negatives Denken give absolute pre-eminence to sacrifice and renunciation as the real foundation, source and origin of greater wealth or production, just as the P rotestant Ethic did, they deny most vehemently that labour can be the real source and origin of greater wealth and assert rather that that source and origin is to be found in capital understood as the saving of labour or better still as the diversion of labour from immediate present consumption to production goods or labour-saving tools or, in other words, means of production or capital. Indeed, for the negatives Denken and for Neoclassical Theory it is quite simply metaphysically impossible for labour to be the source and origin of wealth of any description; if anything, labour is seen as consumption of wealth, as want or as provision for want (Bedarf) to ensure survival. Hence, for Neoclassical Theory labour has no utility and is rather dis-utility; labour is effort, toil and pain: it cannot be the substance of or be embodied in any kind of wealth or goods. Not labour, but renunciation of consumption, which includes labour-as-consumption (!), in favour of the production of labour-saving tools can lead to the accumulation of wealth. Not only, then, is labour not the source of wealth-creation for the negatives Denken, but labour is even considered as a form of consumption of wealth to secure its own subsistence! Furthermore, as we will show presently, for the negatives Denken the accumulation of wealth must be devoted not to consumption but to the production of Objective Value or goods for exchange. The necessary corollary of this condition is that if the increased production is not to be consumed, that part of it

that is constituted by consumption goods can then be used only toward the purchase of the labours of other individuals who do not or cannot afford to save. The protestantische Ethik as enucleated by Weber still expressly glorifies labour as the direct and positive source and motor of wealth-creation, that is to say, as the substance of all except natural wealth, by tracing the spirit of capitalism back to the Christian notions of human expiation of the original sin through the ascetic dedication to work and prayer as in the Benedictine motto ora et labora (pray and work). The devotion to work and prayer represents a withdrawal from the world by subtracting time from the pursuit of worldly and mundane pursuits that sinfully privilege this world and this life against the other world and the afterlife, above all by exalting the toil and sacrifice to which man was condemned when expelled from the Garden of Eden. Work and prayer represent therefore the rightful pious means of expiating for the original sin of mankind and its expulsion from heaven. This is an ex -piation (Lt. pius, pious) that is equally a red-emption (Lt. red-emptio, buying back) of mans salvation, of mans original state of heavenly bliss or grace: - expiation and redemption that represent a renunciation of the evanescent terrestrial world (the Augustinian civitas terrena) and an ascent back to paradise (Lt. ascensio, climbing up [to paradise or civitas Dei]). The task and substance of this A-skesis is thus the withdrawal from and denigration of the world and mundane pleasures by the ascetic through the sheer renunciation of these pleasures and of consumption. This Christian deontology and ethic of ascetic renunciation was articulated early in the Middle Ages by the monastic sects (Benedictine and Franciscan) and was then sharpened and exasperated in the determinist eschatology of the Puritan Protestant Work Ethic. For the Protestant Work Ethic, there are two aspects to the Askesis: one is the toil represented by labour as penance and atonement for the original sin, and the other is the parsimony that devotion to labour entails as a result of being a material diversion from consumption. Yet, as we shall demonstrate here, this renunciation, in its German version as Entsagung, a term coined by Goethe, will undergo a profound and radical reformulation through Schopenhauers metaphysics and ethics as a direct and profoundly influential negation of Classical German Idealism, most virulently in opposition to the universal rationalism of Hegels dialectics. So radical was the reformulation of the Christian and ascetic worldview at the hands of Schopenhauer and the theoreticians that followed in his wake - from Nietzsche to Weber and Heidegger in philosophy, Mach in science, and the Austrian School in economics that we can indeed speak of a reversal (Um-kehrung) of that worldview whereby first its metaphysics and then its ethics were thoroughly turned inside out until they found practical expression in Neoclassical Theory from the early marginalists to the Austrian School, to General Equilibrium.

Weber perceived the central difficulty, the apory in his thesis, as these passages demonstrate:
Rationalism is a historical concept which covers a whole world of different things. It will be our task to find out whose intellectual child the particular concrete form of rational thought was, from which the idea of a calling and the devotion to labour in the calling has grown, which is, as we have seen, so irrational from the standpoint of purely eudaemonistic self-interest, but which has been and still is one of the most characteristic elements of our capitalistic culture. We are here particularly interested in the origin of precisely the irrational element which lies in this, as in every conception of a calling. (Vorbermerkung, pp.75-8).

In fact, the summum bonum of [this] ethic, the earning of more and more money, combined with the strict avoidance of all spontaneous enjoyment of life, is above all completely devoid of any eudaemonistic, not to say hedonistic, admixture. It is thought of so purely as an end in itself, that from the point of view of the happiness of, or utility to, the single individual, it appears entirely transcendental and absolutely irrational. Man is dominated by the making of money, by acquisition as the ultimate purpose of his life. Economic acquisition is no longer subordinated to man as the means for the satisfaction of his material needs. This reversal of what we should call the natural relationship, so irrational from a naive point of view, is evidently as definitely a leading principle of capitalism as it is foreign to all peoples not under capitalistic influence. At the same time it expresses a type of feeling which is closely connected with certain religious ideas. (PE, beginning of Ch.2, The Spirit of Capitalism.)

For Weber, capitalist industry is supremely rational in that it relies on the arithmetical surplus of profit over costs in the process of production and market exchange of goods. Its rationality is purely instrumental (or purposive, Zweck-rationalitat) and not substantive (Wert-rationalitat) because it is made tangible by the ability of the capitalist to calculate precisely the profitability of his enterprise through the medium of money. It is this Kalkulation that makes capitalism a supremely rational human endeavor for Weber. On the other hand, apart from the fact that all callings or vocations are irrational in the sense that they do not have a material origin, and apart from the fact that the Protestant calling leads to the indefinite accumulation of wealth, the capitalist calling appears irrational to Weber also because, on one side, the capitalist seeks to accumulate wealth through the exertion of labour, and yet at the same time the devotion to labour in the [capitalist] calling [is]irrational from the standpoint of eudaemonistic selfinterest. In other words, Weber correctly points out, the entire capitalist enterprise seems wholly irrational and counter-productive from the very self-interested standpoint of the capitalist! If indeed the aim of the capitalist is the eudaemonistic self-interested one of accumulating wealth, it is then irrational to think that this can be done through the devotion to labour or money when it is blatantly obvious that such devotion represents an indefinite renunciation of the very wealth or self-interest that the devotion to labour or to money is meant to help accumulate! And the converse is even more true and irrational: for it is irrational in the extreme to suppose that a devotion to labour that is meant as expiation for the original sin can be pursued so ascetically when one knows that it will actually result in the accumulation of wealth! Weber is saying, quite validly, that a calling that at one and the same time pursues wealth through labour when labour is ipso facto the diversion of time for consumption to time for production and therefore to total abnegation of the self or renunciation of wealth that such a calling can only be classed as irrational, in complete contradiction with the calculating rationality that money makes mathematically possible for the capitalist! Worse still, the indefinite accumulation of wealth that is a by-product of the devotion to labour is irrationally inconsistent with its original goal of expiation of the original sin. This interesting contradiction between devotion to labour and accumulation of wealth should have prompted Weber to reassess the legitimacy of the link between the Protestant Work Ethic and the Spirit of Capitalism not so much in historical terms, where it may well be accurate and even legitimate but above all in terms of the internal consistency of such a link, and therefore of its ability to be adopted effectively by the capitalist bourgeoisie as a lasting ideology capable of being presented not just as a specifically bourgeois economic ethic but indeed

eventually (in the late nineteenth century) as an economic science. ((Interestingly, it was another Neoclassical economist, the Italian Vilfredo Pareto, who first distinguished between ideologies and their derivations that may be functional to the interests underlying them and those that may be dys-functional or detract from those interests. Webers own notion of Zweckrationalitat is aimed at assessing the purposive rationality of given means at achieving stated aims.) Another important inconsistency with the Protestant ethic and Classical Political Economy is that the accumulation of wealth in capitalist industry is impossible as the result of purely individual exertion or toil or sacrifice, but rather through the command over the labours of other individuals something that is clearly inconsistent with the status of the devotion to labour as expiation or sacrifice. For it is preposterous to suggest that one may expiate and atone for ones sins vicariously by accumulating the labour of others! If indeed labour is the real substance of value and the motor of the accumulation of wealth, then it becomes impossible for the capitalist to explain the legitimacy of his profits. As every capitalist knows, any accumulation of capital on any suitable scale is possible only through the use of the labours of many workers, not just the work of the individual capitalist! (As Marx established, capital is the concentration of workers in one place, what he called the concentration of capital distinct from the concentration of capitals which refers to the need for capitalists to equalize the rate of profit across different markets.) Weber himself in the first quotation above specified how the capitalist, apart from feeling justified in his profits through the Protestant Work Ethic, acquired also through this Ethic a workforce of unusually industrious workmen. The contradiction here between private capitalist accumulation and the utilization of a large workforce that makes such private accumulation possible is entirely palpable! Yet another apory in the Protestant Ethic is that of the conflict between greater labour productivity and the depreciation of the price of labour or wages. What for Smith and the Puritans and for Weber - was wealth-creating division of labour, Hegel perceived in Smiths pin production as the paradox of greater productivity of labour that does not enrich the worker! The problem, of course, as Marx will correctly explain, is that the use value of the higher productivity of living labor (its wealth) is obviously greater with specialization, but the valuein-exchange of the labor-power of the worker is lower as a result because the employer can employ fewer workers for the same output and thus lower the wages he pays to the fewer workers he can employ! With good reason, Mandeville could chastise Smith with the harsh reality that the Publick that benefitted from Private Vices (conspicuous consumption) was not the working class whilst taking delight both in the ferity of humans as well as in exposing the hypocrisy of Smiths invisible hand (a Deus absconditus or hidden God) that justified bourgeois enrichment and working-class immiseration as a hidden divine purpose. Mandeville could still share the condemnation of laziness and of the charity halls, not for Deistic reasons related to the Protestant work ethic (for discouraging labor as an avenue to wealth), but for the quite cynical realization that they invited work-shirking on the part of proletarians to the detriment of profits and production of goods to satisfy those private vices that he mercilessly lampooned! What may appear as contradictory was in fact only sheer cynicism that Mandeville preferred to hypocrisy for him, hypocrisy is the tribute that vice pays to virtue.

This conceptual inability of the Protestant Ethic to reconcile labour as the source of new wealth and the legitimacy of capitalist profits as a separate claim to wealth also based on labour is a major source of theoretical paradoxes, one that afflicted equally Classical Political Economy, and one that Marx exposed vehemently and ruthlessly. In reality, with the protestant ethic Weber is still unwittingly reprising the Labour Theory of Value in its pre-Marxian form, although in his academic lectures he had adopted already the marginalism of the Austrian School. (In the Vorbermekung, however, he embraces Cantillons notion of entrepreneurial profit whereby profits are the simple outcome of exchange. It is a well-known fact that Webers understanding and grasp of economic theory was rather limited.) Specifically, Weber was embracing Smiths theory of specialization as the source of new and greater wealth: - division of labour, specialization, as wealth-creation, as more efficient pro-duction or labour productivity, and therefore labour as pro-duction. Wealth is created through growing labour productivity enabled by exchange and therefore specialization, that is, through the pro-duction of more goods for exchange and the use of fewer goods for consumption: growth of productivity through exchange is the source of wealth. In this perspective, wealth is the squeezing out of greater output from existing means of production or resources or from their re-combination by means of higher labour intensity. By consuming less himself or by working harder the worker can exchange more and by exchanging more he can specialize more so as to produce even more! The worker can be more productive by specializing, producing more and consuming less in the exchange. Smith assumes fixed and exogenous technology. Smiths theory does not encompass innovation or the role of wealth as delayed consumption. Thus, consuming less oneself becomes producing wealth for exchange by consuming less. Both Smith and Weber single out this parsimony as a means of accumulating wealth and as an aspect of Asceticism in (PE, p161). It can be seen how this protestant work ethic rationale still preserves entirely the link between labour and wealth-creation because the aim of parsimony is not the saving of labour time through its diversion from consumption to production, but rather increasing the productivity of labour through its intensification by means of specialisation. In the Smithian worldview, faithfully adopted by Weber to describe his conception of the Protestant Work Ethic, it is still labour (Arbeit), it is the higher productivity of labour that is the immediate source and cause (fons et origo) of the increase of wealth. This rationale and aetiology is in all and for all the rationale of Natural Law, of Classical Political Economy and of the Labour Theory of Value (from the mediaeval Schoolmen such as Aquinas to Smith and to Marx through Ricardo and JS Mill). It is the ancient biblical prejudice that wealth comes only in the sweat of thy brow. (Smith refers in Astronomy to the distinction between tranquility and composure and labour and discomfort.) Labour as toil is the price to be paid for the acquisition of wealth a real cost hypothesis. As we are about to see, this worldview of wealth as a direct product of labor requires three fundamental presuppositions: the first is that human needs are fairly homogeneous, with minor exceptions; the second is that human labour, although it may be as heterogeneous as there are human activities, is quantitatively homogeneous in terms of the labour-time or labour-power required to satisfy these homogeneous human needs; and third, as a corollary of this, that labour therefore represents the most fundamental and pervasive source of human social co-operation and co-ordination to ensure the reproduction of society, the basis of the social synthesis.

In effect, these presuppositions, especially the last, are in direct contradiction with the aim of both Classical Political Economy and of the Protestant Ethic to justify and rationalize capitalist individual accumulation of social resources as private property which is why this rationale and aetiology could no longer serve the bourgeoisie after the initial phase of accumulation in the First Industrial Revolution. The central achievement of Neoclassical Theory, derived fundamentally from the philosophical reversal of Western Hellenic and Judaeo-Christian metaphysics performed by the negatives Denken, will be the outlining of a complex and comprehensive economic positivist science that will relegate labour and the working class to their subordinate place in the market economy. Above all, by severing the social-teleological osmotic link between labour and wealth, Neoclassical Theory was able to replace the JudaeoChristian Beruf, so burdened with metaphysical notions, religious tenets and moral theology (this was Schopenhauers, and Nietzsches, critique of Kant and Hegel), with the positivistic Hobbesian amoral, effective Entsagung that leads to the entrepreneurial spirit (Unternehmergeist) of the captain of industry glorified by Schumpeter. This is the specifically bourgeois economic ethic that Weber was seeking at the end of Die protestantische Ethik but understood and traced incorrectly. The new link that needs to be theorized is that between labour as consumption of nature, saving as renunciation of consumption, and thence as deliverance from the world (Schopenhauer), on one side, and then capital as diversion of labour from consumption of wealth to production of labour-saving tools or tools that increase labour productivity, utility as partial satisfaction of insatiable human appetite or as gap between want and provision for want, and therefore capital as store of utility or value meant for future exchange, value for exchange as objective [market validated] value and finally capital as interest-yielding labour-saving tools due to the discount of future goods.Only by severing the nexus between labour and wealth and replacing it with the link between wealth and utility, and only by reversing (um-kehren) the metaphysical content of wealth and labour by re-defining fundamentally the understanding of these human realities will it be possible for the bourgeoisie to establish that wealth is not an objective or intersubjective entity that can grow or be accumulated but rather a subjective estimation by atomistic individuals of the utilities in exchange or marginal utilities to be derived from the exchange of production and consumption goods in a temporal dimension, that is, through the subjective discounting of present wealth as against its use in the future. Neoclassical theory draws its conclusions thus from the application of abstract general principles from physics and psychology. This is the side that Weber neglects but that is present in Schopenhauer and is insightfully and coherently, though not always explicitly, applied in the sphere of economic theory by BohmBawerk and the Austrian School of Economics, first, and then more broadly by Neoclassical Theory. Let us look more intently then at the contrast between Classical and Neoclassical notions of wealth and value and the role of labour and capital in their creation and accumulation.

Classical Political Economy and Neoclassical Economic Theory

A. Labour as Present Consumption and Capital as Production of Delayed (Future) Consumption or Objective Value The propositions of the Protestant Ethic and of the Labour Theory of Value are fundamentally antithetical to the metaphysical positions of the negatives Denken and also of Neoclassical Theory. For Webers Calvinists and Puritans, wealth is a sign of Beruf, of divine grace and active divine calling. But the Beruf, even in its religious specification of Entsagung, of renunciation and Askesis, does not yet sever decisively the theoretical link between labour and the accumulation of wealth by interposing the role of capital in the trans-formation of existing natural resources or wealth into greater wealth for individuals. The wealth of the Protestant Work Ethic is still a constructive universal human value that can be socially aggregated and accumulated by means of labour as effort first and then as sacrifice and renunciation of consumption, even though labour is not seen as social fulfilment but rather as expiation and sacrifice by the individual soul in its univocal relation with the Divinity. The severance of labour from wealth - now defined as subjective value, that becomes objective only as value in exchange -, the strict denial of social labour and the postulation of individual labours, and the interposition of capital between labour and its imprescindible object, that is, nature, as the sole means by which individual labours can do more than satisfy individual wants all these elements are absolutely vital to the development of a specifically capitalist ethic freed from the moral theology of Judaeo-Christian eschatology and of mediaeval Natural Law or jusnaturalism that atavistically clings to the pillars of universal human values, of inter esse, and of commutative and distributive justice much to the detriment of bourgeois self-interest. Two are the essential foundations of the Protestant Work Ethic and of the Labour Theory of Value that bourgeois economic theory needs to demolish: the first is that all economically significant wealth that is to say, all use values pro-duced by human beings and not occurring naturally derive their exchange or market value from labour itself. And the second is that labour is a homogeneous entity that can be measured in terms of the amount of it that is embodied in exchange values and upon which market prices are agreed upon by market agents. Clearly, therefore, Classical Political Economy intends Value as a concordant or centripetal reality that is, as an entity whose content and quantity can be agreed upon by all human beings and be the subject of social and economic co-ordination either through planning (socialism) or through the market (liberalism). It is this universality, this concordance and possible harmony that the negatives Denken attacks most virulently. For the negatives Denken, human wants are entirely subjective and cannot in any way shape or form be regarded as homogeneous or commensurable. Consequently, wealth can be considered only from the point of view of Subjective Value pertaining to each individual worker in isolation from other workers. Hence, although it is the immediate factor in the production of wealth, labour can exist only as individual labours precisely because neither wealth nor labour can be homogeneous objective use values that apply to human beings as a species that is, phylogenetically. Labour must be regarded only ontogenetically, as mere mechanical operari, only as the physical bodily exertion on the part of the individual worker

separate from the exertions of other workers and separate from any tools that the worker may utilize. Indeed, the utility of the tools is considered to be entirely distinct and separate from the actual body of the worker. Consequently, labour always and ineluctably consumes its object, whether it be the tools it utilizes or the materials it works upon, to provide for the present material wants of the labourer. In no circumstances can labour be considered to be homogeneous or to satisfy homogeneous human needs and therefore to constitute the most basic form of the human social synthesis, of human social co-ordination and fulfilment. A fortiori, there can be no notion of social labour for Neoclassical Theory, nor can there be any separation (Trennung) in the Marxian sense between labor and the means of production - because there was never any union between them! The human operari is entirely instrumental to its goal the provision for want. There is and there can be no Gattungswesen, no species-conscious being, no original union of workers with tools or indeed with the product of the labor process because labour is not seen as a social activity. Quite to the contrary, the insatiable nature of human wants and the scarcity of their provision ensure that there is conflict between and among workers, and between workers and nature, let alone between workers and capitalists! Human beings are irreducibly and ontologically things-in-themselves; they are Wills or, as Nietzsche describes them, instincts of freedom that can co-operate or col-laborate to the extent that their needs, their iron necessities and their wants are provided for and satisfied. This is the Hobbesian status naturae, the bellum omnium contra omnes, the state of nature in which homo homini lupus obtains and that Schopenhauer postulates in Book Four of Die Welt als Wille und Vorstellung, after his pitiless critique of Kantian ethics in the Grundprobleme der Ethik, of the moral theology of the Categorical Imperative. In the negatives Denken initiated by Schopenhauer in response to the Hegelian dialectic, the instrumental operari, the Arbeit, labor itself does not have utility because it is the objectification of the Will to Life with its unfathomable Wants, with its evanescent World. Only the World is wealth; only consumption goods have utility for the Will. The Will alone ultimately measures or values or prices the marginal utility of the means of production not in an objective or substantive sense, but merely from its unfathomable desire (conatus) and appetite (appetitus), from its individual viewpoint (Gesichtspunkt), from the per-spective of the individual choice. Utility is an entirely subjective and inscrutable entity that can be measured as Value, that can be given social significance or a social Form that can be reified only through the social osmosis of the market pricing mechanism where individual Wills clash or com-pete and come into conflict for the same wealth rendered scarce by the insatiable individual human appetite. The Askesis, Webers ascetic renunciation of the world or Entsagung, is emphatically not attained through the pursuit of labor as an end in itself, but rather through the deferral of consumption and the application of the Arbeit to the construction of tools (means of production, or capital) that are more roundabout and therefore increase the productivity of labor by saving it, effectively by suppressing or extinguishing it. Like fire, labour does not pro-duce wealth but rather consumes or trans-forms the means and materials of production that it utilizes. And the higher Value derived from producing with more roundabout methods of production can be calculated not just in an instantaneous or timeless analytical dimension but even in a temporal one, in terms of time preference, that is a projection toward, a mortgage over the future. The notion of fructiferous capital, of interest-bearing capital, is all here.

Labor can have no utility because it has no intrinsic value. Instead, labor is effort (Kampf), it is the objectification of the Will, it is the operari, it is Pain (Leid) without Pleasure (Lust): labor is dis-utility! And the marginal utility of the consumption goods produced to provide for the workers wants the wage - must be equivalent to the marginal dis-utility of labor if the production of consumption goods is to be optimal. Neoclassical theory from Gossen onwards begins with Schopenhauers notion that human living activity is toil, it is effort, it is pain and want (Bedarf) in search of provision (Deckung), as BohmBawerk styles them in the Positive Theorie. It follows from this perspective that human living activity is conceptually separated from its object, from its environment which supplies it with the means of production. Consequently, human living labour is seen from the outset as pure and utter destitution, as poverty, as want. Accordingly, the means of production, the tools utilized by labour, cannot serve as means for the expression or objectification of human living labour but rather as labour-saving tools! We should note the difference between Jeremy Benthams Utilitarian or hedonistic calculus of pleasure and pain and the strict nexus established by Schopenhauer between operari as Arbeit (labor) and A-skesis as release from Pain, as renunciation of the World and therefore the identification of labor with want and pain. This nexus is entirely missing in Bentham just as it is in JS Mill who espoused the Labor Theory of Value as the last great representative of Classical Political Economy. But it is this Schopenhauerian nexus that is vital to the early development of the theory of marginal utility. What this means is that human living labour itself is already considered, for one, as a tool, as an instrument whose productivity can be measured in terms of units of output per unit of time. And for another, living labour is seen as an activity or a labour power that, just like Schopenhauers Will to Life and its objectification, the Body, is purely abstract, mere potentiality, utter possibility, sheer pro-ject not bound by any phylogenetic and social needs of any description whatsoever. In practice, it is the latter view of living labor the assumption that living labor is only mere potentiality - that serves as the premise that leads inexorably to the former conclusion that is, that living labor is only a tool, a force or power that can be rendered homogeneous not through organic co-operation but exclusively through mechanical conflict between human wills. Marxs critique of political economy as founded on abstract labor is all here. In this perspective, abstract labour is sheer, naked, destitute poverty, barren misery potential that can only become actual if, and only to the extent and manner that, it is allowed by the laws of supply and demand to come into contact as a tool with the means of production that are the endowment and possession of the capitalist. Labor is a fire that devours or consumes or at best transforms its object simply to keep itself burning - and yet cannot for all its burning cannot pro-duce anything. For the Neoclassics, then, labour and workers are by definition the factor of production that is in want or need, that suffers toil and pain and dis-utility and that needs capital (the means of production as labour-saving tools) in order to satisfy its wants that are made immediate, urgent in contrast with the capitalist owner who can defer consumption by the very fact that it does not now have provisions for its subsistence and reproduction and survival!

The blunt brutality of Schumpeters illations conclusions drawn from utterly ludicrous premises need not detain us long here. Bohm-Bawerks theory of the greater productivity of more roundabout methods of production (a feat of metaphysical fantasy unequalled in the sorry history of the Economics a bedtime story to make children laugh) is yet another version of the Schopenhauerian renunciation (Entsagung), the refusal of the pain (Leid) of the Will to Life in its abulic, incessant and insatiable search for pleasure (Lust) that can never be satis-fied, least of all at the moment of its ful-filment (Schopenhauer)! Bohm-Bawerk is clearly intimating under the pretense of economic theory that the capitalist is rewarded with higher productivity of the tools (capital) he possesses by virtue of his ascetic renunciation or deferral of immediate consumption in order to devote his labor and existing capital to the construction of more roundabout methods of production that will yield higher productivity and therefore profit when they are utilized. As we will see in Part Two, Weber argues in the Ethik that it is the Protestant calling (Beruf) of labor as an end in itself that makes up the spirit of capitalism and constitutes a specifically bourgeois economic ethic. We can see already from the quotation above that in fact it is Neoclassical Theory that provides such a specifically bourgeois economic ethic because it lays emphasis of the source of Value on the renunciation of immediate consumption by the capitalist through the preference of more roundabout means of production (capital) rather than Webers devotion to or calling for labor as an end in itself which, of course, is much closer to the Labor Theory of Value of Classical Political Economy. Here, the entire concept of interest or profit is evidently founded in Neoclassical Theory on the idea of a price struggle between capitalists and workers that, given the premises of this theory, is always decided in favour of the capitalists. Contrary to the Protestant Ethic, this negative view of labour and indeed of human agency in the world contends that labour is not ascetic deliverance from the world and from wealth; it is not renunciation but resignation, mere operari or passive acceptance of the world. The negatives Denken contends that labour is mere consumption of existing wealth or of Nature through its transformation (see the first part of Bohm-Bawerks PTC on this). For the negatives Denken, labour cannot produce and create greater wealth as value-in-exchange unless capital intervenes to aid labour in its interaction with nature. Indeed, the very notion of labour as the positive creation and accumulation of wealth (as input in productive output) is meaningful only within the perspective of the Labour Theory of Value first outlined in Classical Political Economy. For the negatives Denken and then for Neoclassical Theory, wealth quite simply cannot be pro-duced by labour without the intervention of capital. Capital here is not seen as an inert pile of labour-saving goods but rather as the pro-duct of the capitalists wilful renunciation of consumption represented by labour through the production of laboursaving tools! Quite simply, capital is the capitalists will to employ labor and dominate or command labor, that is, the worker! It follows that for the negatives Denken and for

Neoclassical Theory just as for Karl Marx! capital is not a thing but is rather a will opposed to labour. (One of the major Marxist objections to Neoclassical Theory is that it treats capital as a thing and not as a social relation of production. We can see how erroneous this objection is and indeed the Marxist notion of Value is itself tainted with the reification of socially necessary labour-power where this necessity seeks to turn the Marxian critique of capitalist social relations of production into a reified quantitative science, as we are about to show.) In the Protestant Ethic and even in Socialist movements, labour is seen as renunciation also; but this renunciation is purely the substitution of time for the consumption of goods with more time devoted to labour and not necessarily to production of production goods to produce Objective Value. As such, the renunciation of the Protestant Ethic may be seen as expiation or penance or self-flagellation or even as parsimony and as a form of saving: but it is not necessarily saving for production intended as accumulation! The negatives Denken and neoclassical theory insist that only this specific type of saving constitutes capital. Capital therefore is not just any saving of consumption: rather, capital is the delay of consumption in favour of production of Objective Value. Unlike the Protestant Ethic for which devotion to labour is a necessary and sufficient condition for the accumulation of wealth, for neoclassical theory such devotion to labour is still a form of consumption if the labourer is paid more in consumption goods (wages) to compensate for such devotion. The devotion to labour can be a sufficient condition for the creation of wealth only if direct consumption is replaced with direct production of production goods. Only in such a case, only when devotion to labour is also a postponement of consumption as its renunciation in favour of production, can such devotion to labour become the production of capital. In effect, it is diversion of labour from consumption to production goods, and therefore the deferral of consumption in favour of production, rather than devotion to labour as expiation or parsimony, that constitutes the true renunciation for neoclassical theory. The ultimate purpose of this diversion of labour and delay of consumption is at once the negation of labour as consumption, the sublimation of ones selfish wants, and the exaltation of capital as labour-saving production. The aim of the capitalist here is not devotion to labour as parsimony for its own sake or for religious reasons and such devotion to labour certainly does not necessarily lead to the accumulation of wealth. As Bohm-Bawerk puts it,
Adam Smith's celebrated proposition therefore"Parsimony and not industry is the immediate cause of the increase of capital"is, strictly speaking, to be turned just the other way about. The immediate cause of the origin of capital is production; the mediate cause is a previous saving. (PTC, II.4, fn.30) In other words, the previous saving is not just any saving (parsimony) but rather a specific kind of saving that mediates production, one that is intended to increase production by means of labor-saving tools.

VALUE There is no objective quantity such as labor to explain prices no substance behind value. Value is quite simply the actual phenomenon indicated by market prices: no Freudian

oceanic feeling (in reply to Romain Rolland, Preface to Civilisation and Its Discontents), no Schopenhauerian sympathy (Mit-Leid) derided by Nietzsche only the physiological sign of the subjective marginal utility, its visible manifestation, the body as the objectification of Will. Therefore, no inter esse: labor is the aimless consumption of the world by the Will and the Will is the thing in itself. There is no common being, no inter esse, only strict phenomenalism, only sensations (Machian Empfindungen). To be is the same as to be perceived. Sichtbar machen: to render visible is the task of science, and to con-nect facts or public sensations in the simplest possible relation mathematically so that they can speak for themselves. In short, Simplex sigillum veri simplicity is the seal of truth. Truth is certainty. That is the aim and scope of science. It is not Labor that is the substance behind the Value that is distorted by market prices, as Classical Political Economy had it. Labor does not create pro-ducts or goods. Labor rather consumes what is already there, in Nature (!). (See for what follows the first chapters of Bohm-Bawerks Positive Theory of Capital.) Physical science tells us that nothing can be created; everything is conserved; everything is transformed. Labor simply trans-forms the natural resources available to it so as to be able to reproduce itself, to survive and provide (Bedarf) for its wants and needs. Labor has no utility therefore: it has only dis-utility in that it needs the existing wealth of Nature to preserve itself. The only way in which labor can make possible
the pro-duction of Value, then, is by utilizing labor-saving tools. And that is the precise definition of Capital. It is Capital, not Labor, that allows human labor to be productive; it is tools that

allow workers to produce more wealth and value: not in the positive substantive and objective sense that they would have if wealth and value were viewed as universal human endowments, but only in the negative subjective sense of providing for the wants of individuals by saving labor for them individually, reducing their subjective pain (Leid) of and effort of work, of the operari, its strife (Kampf) in a world in which pleasure (Lust) is only the Provision [Bedarf] for Want, the satis-faction of unlimited wants, their partial extinction their fulfilment and com-pletion only in a negative sense of the appeasement of a want or desire, never in the positive sense of its full gratification, for that is impossible! Neither labour nor utility nor wants are intended as universal entities: they are all purely subjective but they are made objective through exchange in the market (this is a major definition in B-B[PTC]). That would be Nirvana, the extinction of all wants (Robbins). And it is only by saving labor, by curbing the Will, by deferring consumption that the tools of productive capital can be produced precisely, by substituting present consumption with labor-saving tools. Here then is the inversion of Max Webers proposition in the Ethik that saw the ascetic devotion to labor as the specifically bourgeois economic ethic. No! It is not devotion to labor, it is rather the saving of labor devoted to present consumption that allows its diversion to the construction of tools or productive capital that will permit labor to be more productive! Labour is seen here as an abstract quantity, as labour-power that is made more or less productive by the capital or means of production that it uses. In the words of Bohm-Bawerk, Classical Political Economy has been turned just the other way about!
Adam Smith's celebrated proposition therefore"Parsimony and not industry is the immediate cause of the increase of capital"is, strictly speaking, to be turned

just the other way about. The immediate cause of the origin of capital is production; the mediate cause is a previous saving. (PTC, II.4, fn.30)

It is industry and not parsimony that is the immediate cause of the increase of capital. But industry here does not mean Labor! To be sure, both labor and capital are needed for

production, yet capital alone is already wealth and wealth alone, not labor (which is need) can produce other wealth. Capital alone can wait until production is complete, whereas labor cannot because it is need that requires tools to realize itself. It means the renunciation of consumption
goods in favour of labor-saving devices, the saving of labor as the operari of the Will through the use of productive capital! Labor is not and cannot be the source of Value because Value is the saving of Labor as Want! So here finally! we have what Max Weber was looking for but could not find with his definitions and approach in the Ethik: - A specifically bourgeois economic ethic in which labour and capital are antithetical and capital is mastery over renunciation and sublimation of labour as want, as poverty, as appetitus! The Neoclassical Counter-revolution against the Socialist ideology of the industrial proletariat had finally arrived to found an economic science.

Hence, it is not more labour that produces wealth as objective value or value in exchange. Instead it is the diversion of labour to labour-saving production as a deferral of consumption that leads to greater value. Here the sacrifice, the toil or effort, the true parsimony is not that of labour which is in any case condemned to being present consumption, the immediate provision for want but much rather that of the capitalist the labourer who defers consumption to produce labour-saving tools. This is the conundrum of historical economic analysis that Joseph Schumpeter and JM Keynes set out to explain. Bohm-Bawerk himself allows of Uncertainty as a source of variations in expectations as to the marginal utility of future goods. But again this is something that can be arbitraged (agio) away by the market mechanism at any one time. As he rightly notes, neither abstention nor Uncertainty can determine marginal utilities or prices for the very simple reason that they are negative or passive emotions that cannot increase the productivity of labor through labor-saving devices or means of production or capital. Abstention in and of itself cannot be the source of Value. It has to be the switched preference between consumption and production goods abstinence in this specific economic context involving labor-saving devices that is economically relevant. It is not frugality or mere industry that leads to the diversion of the existing powers of nature, but the diversion of time preferences to labor-saving tools, the substitution not the mere abstinence or frugality or saving of consumption goods with labor-saving goods that leads to a different distribution or exchange of marginal utilities. Exchange is always relative but its content (marginal utility) can be of a higher or lower order for the individuals involved because of their endowments whose stock is raised by the preference for labor-saving devices. These are not strictly time-saving devices; they are labor-saving devices because the object is always to save labor to provide for given wants, which will rise in kind as more capital is employed in production through roundabout methods. Wants expand to absorb the available output by labor: that is why economic science deals always with scarce resources. (Recall the description of economics as the dismal science.) Resources are inevitably scarce because human wants are insatiable and because wealth cannot

be created but only conserved or transformed or consumed. Capital is therefore stored-up labor at a given time of exchange in the sense that capital increases the productivity of labor by permitting the production of Objective Value that can then be used to command more labor: not labor understood absolutely or positively as utility, but rather negatively as dis-utility at a given time, given that labor too is subject to time preference. Capital is saved or suppressed or extinguished labour. Thus, Franklins formula, time is money, is to be preferred to Smiths parsimony is the source of wealth because parsimony in and of itself is neither a necessary nor a sufficient condition for the creation of wealth unless it is exercised in the sphere of production, whereas the saving of labour-time in production (which is what Franklin meant by time) is a necessary condition for the making of money or, more precisely, profit. Franklins slogan must be read as money is saving of labor-time for provision of goods for immediate consumption [therefore not exchange values but only use values] and diversion of it to production of labor-saving goods for the future production of goods [values-in-exchange] for consumption (cf. Keynes, money is a bridge between present and future).
Webers Askesis ascetic ideal is not relevant to the spirit of capitalism because it understands devotion to labor as an ascetic end in itself! Similarly, Smiths labour theory of value is also not relevant because it mistakes parsimony and frugality as sufficient conditions for industry (that is, capitalist production) when in fact they are only a renunciation of consumption! On the contrary, for the Neoclassics, what creates wealth and value (or rather, makes it possible through the diversion of the powers of nature) is not labor as an end in itself, even for ascetic goals; nor is it frugality as the renunciation of consumption. This moralistic sense of frugality is absent in the Neoclassical scientific and positivist theories. Quite to the contrary, what occasions wealth or value is the diversion of labour from present consumption to production of tools for production, that is, of means of production as labor-saving tools! It is not labor that is the source of wealth or value, as Adam Smith and Weber had it. Instead, it is the deferral of consumption that comes from the diversion of labour to the production of labor-saving tools or capital - or the sacrifice or deferral of present consumption in favour of production goods that can then pro-duce those consumption goods with less labor and therefore be relatively more valuable! If labour were the true source of value, then more labour would produce more value; yet in reality it is labour-saving tools or capital that allow labour to produce more wealth as goods for immediate consumption that can purchase fresh labour through labor-saving tools. From which it follows that it is these tools or capital, not labour by itself, that produce greater wealth and potentially valuein-exchange. Here time becomes the essential scientific element of Value. All capitalist economy is economy of time. Thus, time is money means labor-time-saving tools or capital not labor! - is money or generic social wealth or claim on social resources remembering that labor means labor-power or productivity in terms of output per unit of time - that is, not a quantity but a rate. The saving of labour time permitted by capital allows its owner to control more labour as want. The capitalist can wait (B-B, Schumpeter).

To produce capital, the renunciation of consumption goods must be aimed at the production of production goods aimed at values in exchange - because otherwise the goods produced would still be used in consumption by the labourer, not in pursuing renunciation as a means of dominating more labour-power! The production of values in exchange through the adoption of labour-saving tools (capital) allows the owner of these tools, the capitalist, to these values for the individual labours of other individuals whose wants are too pressing for them to delay consumption, in such a way that their provision for want (Bedarf) becomes dependent on their

being employed by the owner of capital, who now becomes a capitalist employer (a giver of labour, Arbeit -geber) to the dependent employee ( a taker of labour, Arbeit-nehmer). From this radically altered perspective, it is no longer the worker who gives wealth or value-creating labour to the employer to increase his wealth or capital, but rather the other way around: it is the employer who allows the labourer to consume capital so as to earn a wage (life-means or provisions, Lebens-mitteln). It is capital, not labour, that creates wealth or utility. Clearly therefore it is not labour as such that creates wealth but rather the delay in the consumption of consumption goods through the diversion of labour to the production of production goods. Labour here remains at all times a mere operari, a mere mechanical consumption of wealth. Furthermore, human wants are seen as insatiable and inextinguishable. Therefore, the decision to divert labour to production goods and to delay the consumption of consumption goods represents for the negatives Denken a Schopenhauerian ascetic renunciation and sublimation not just of ephemeral worldly pleasures but also a transcendental refusal of the Arbeit, of Labour, and of the Will to Life that motivates it in short, a renunciation of labour as consumption of the world in favour of labour-saving tools or capital as rational domination over and extinguishment of the Arbeit and of the world of Nature - through the rational sublimation of the Will to Life. In the words of Lionel Robbins, Nirvana is the satisfaction of every desire. As we will see, this renunciation turns the Schopenhauerian Will to Life into a Nietzschean Will to Power or, in Schumpeters version, a capitalist entrepreneurial will to conquer the Unternehmersgeist. Without the intervention of capital, individual labours can only either consume or transform existing wealth (nature) to ensure provision for their insatiable wants, but they cannot, as labour (!), produce greater wealth. (Similarly, Adam Smith completely ignores the possibility of social labour in his analysis of exchange as the basis of specialization and higher productivity something that Rousseau did instead see L. Colletti in Ideologia e Societa.) Labour by itself is a negative factor of production in the sense that it can only satisfy the most immediate wants in terms of the duration of the goods it can obtain for the satisfaction of individual wants if unaided by tools. Only through the use of capital can labour produce wealth in a form that can be accumulated. But the use of capital does not change the essential quality of labour which is that of being sheer operari, mere mechanical exertion. Capital becomes therefore the only positive factor of production hence the positive theory of capital. For the negatives Denken, labour has no utility in and of itself because in and of itself, by itself, without the intervention of capital, labour is mere immediate consumption of nature and cannot be the cause for the accumulation of wealth or goods with utility remembering that nature alone is a source of utility or Subjective Value. All values-in-exchange are also part of nature except that they have been trans-formed by labour with the aid of capital. Labour therefore is want, or rather, it is the only means of providing for want through the consumption of nature. But this consumption cannot produce greater wealth or utility unless it is mediated by capital, because capital alone as labour-saving tools, as means of production can yield to labour the productivity that can free it from its status as provision for want (handto-mouth existence or mere subsistence).

Labour therefore is mere want, mere operari; it is poverty by definition or at least it is the simplest form of subsistence living. Consequently, labour can have only dis-utility because it is mere effort or toil, mere labour-power or abstract labour. (Marx will later object that the unique use value of the commodity labour-power, of abstract labour or rather, of labour made abstract by capitalist command -, is precisely to produce surplus value for capitalists under their violent command. This vital Marxian distinction of the Doppelcharakter of the commodity labour-power - that is, its being a mere exchange value for capitalists but in fact being the source of all exchange value - is what re-connects the appearance of market capitalism as a scientistic eternal human condition to its actual reality as a historically specific exploitative social system.)

Wealth and nature are seen by the negatives Denken as being antithetical to human being (in Schopenhauers phrase, the Will to Life), as ob-jects (Gegen-stande) literally standing against human beings, first, because human wants are bottomless; and second, as a corollary, because each individuals wants and labour must be antithetical to and in competition and conflict with the wants and labours of other individuals. Wealth and nature do not and cannot represent a source of uniform homogeneous commensurable and compatible objectification of human potential, of social labour, but are seen rather as the source of satisfaction of strictly individual wants that are absolutely incommensurable between individuals and indeed are a source of universal conflict between one another and between them and Nature, individually and collectively. Wealth and nature therefore are not seen as resources by means of which human beings through their labour - understood as social labour, that is, as being also a resource indivisible and inseparable from nature - necessarily and constructively objectify their abilities and fulfil their needs as a species, phylogenetically and collectively. On the contrary, both nature and wealth are seen as resources made scarce by the insatiable subjective wants of human beings understood as atomistic in-dividuals, that is, ontogenetically, in competition and in conflict both with nature and with one another infinite subjective wants for which labour can provide only immediate provision as hand to mouth subsistence. Thus, labour is first broken down into individual labours that can in no manner shape or form be regarded as social labour, and then, as a direct corollary, these individual labours are seen as unable to do more than provide for the immediate wants of labourers without the intervention of labour-saving tools or capital. Once the possibility of social labour is denied, it is obvious that the only sources of social co-ordination for individual labours are capital at the point of production (supply) and the market at the point of distribution (demand). In any case, this social co-ordination takes place only as the expression of the capitalists desire to accumulate wealth. Wealth itself therefore is not a universal intersubjective human value least of all is it made so by the uniform measure provided by labor. Rather, wealth is a purely and entirely subjective value that becomes objective only in exchange between individuals only as artificial convention denoted by market prices. (This position is wholly identical with Nietzsches vitriolic critique of human conventions, including language, that form the basis of Western humanism especially in Uber Wahrheit und Luge.) A direct corollary of this position is that there can be no such

entity as social labour and that therefore labour must be understood as simply a collective noun denoting absolutely incommensurable individual labours. Unlike Classical Political Economy and the Labour Theory of Value, which saw nature as universal use value for the human species, all wealth or value or utility is subjective for the negatives Denken to the extreme point that it is incommunicable and incommensurable between individuals and certainly not quantifiable either individually or socially. Even social welfare can be assessed only relatively as in Pareto optimality, in terms of the increase of welfare of the last individual, but cannot be aggregated because wealth is objective only to the extent that its value or utility to each individual can be exchanged between in-dividuals. Clearly then, the market economy envisaged by the negatives Denken and Neoclassical Theory is one that is always in equilibrium, as a static economy that can grow only by moving from one equilibrium to another. (The point was made by Schumpeter in the Theorie. The theoreticians who formalized general equilibrium Arrow, Debreu and Hahn later concluded what any serious reflection on neoclassical theory could have told them from the outset: - that equilibrium theory is incompatible with the notion of money as a means of exchange and a store of value.)

The culmination of this blatant nihilism implicit in the Weltanschauung of the negatives Denken can be found in the principal theoretical works of the most prestigious member of the early Austrian School, none other than the bourgeois Marx himself Eugen Bohm-Bawerk. Here is how his greatest pupil, Joseph Schumpeter, summarises his work in a manner that needs little commentary from us to be placed in the context of our discussion and that in connection with interest, that is the most fundamental aspect of profit as the most unabashedly natural claim by the bourgeoisie over social wealth (in the form of what Marx called fructiferous capital):
In 1884 there appeared Bhm-Bawerk's critical work which established not only the untenable but also the superficial character of the existing explanations of interest and opened a new era for the theory of interest. This book and the one entitled Positive Theorie, which followed four years later, trained numerous theorists of interest and hardly a single one remained unaffected by them. Of all the works on the theory of marginal utility these two volumes had the deepest and widest effect. We find the traces of their influence in the way in which almost all theorists of interest phrased their questions and proceeded to answer them. There are signs of this influence even in those writers who rejected the concrete solution of the problem of interest as offered by Bhm-Bawerk. This solution is based on the fundamental idea that the phenomenon of interest can be explained by a discrepancy between the values of present and future consumer goods. This discrepancy rests on three facts: first, on the difference between the present and the future level of supplies available for the members of the economy, secondly, on the fact that a future satisfaction of wants stands much less vividly before people's eyes than an equal but present satisfaction. In consequence, economic activity reacts less strongly to

the prospect of future satisfaction than to that of present enjoyment and the individual members of the economy are in certain circumstances willing to buy present enjoyment with one that is greater in itself but lies in the future. The discrepancy between present and future values is, thirdly, based on the fact that the possession of goods ready to be enjoyed makes it unnecessary for the economic individuals to provide for their subsistence by HISTORICAL SCHOOL AND MARGINAL UTILITY 199 producing for the moment, e.g. by a primitive search for food. The possession of such goods enables them to choose some methods of production which are more profitable but are more time-consuming: the possession of goods ready to be enjoyed in the present guarantees, as it were, the possession of more such goods in the future. In this 'third reason' for the phenomenon of interest there are contained two elements: First, the establishment of a technical fact which so far had been unknown to the theorists, namely that the prolongation of the period of production, the adoption of 'detours' of production, makes it possible to obtain a greater return which is more than proportionate to the time employed. Secondly, the thesis that this technical fact is also an independent cause of an increase in value of consumption goods which are in existence at any given time. Interest as form of income then originates in the price struggle between the capitalists on the one side, who must be considered as merchants who offer goods which are ready for consumption, and landlords and workers on the other. Because the latter value present goods more highly and because the possible use of present stocks of consumer goods for a more profitable extension of the period of production is practically unlimited, the price struggle is always decided in favour of the capitalists. In consequence, landlords and workers receive their future product only with a deduction, as it were, with a discount for the present. The achievement which this formulation contains was epoch-making and a great deal of the theoretical work of the last twenty years has been devoted to a discussion of it and to its criticism.

(Schumpeter, Economic Doctrines and Methodology.)

An increase in wealth can be obtained by human beings only through the use of tools. But for tools to be produced, labour must first be diverted from producing goods for immediate consumption. Because labour is always and everywhere a consumption of wealth, even when it is devoted to the production of tools, the real source of greater wealth for humans cannot be labour itself but rather the decision by the labourer to divert his individual labour from direct consumption and the production of consumption goods to the production of production goods that increase its productivity, not for the sake of personal consumption but exclusively for the

sake of exchange. So long as the aim of production is to satisfy the labourers personal wants, only Subjective Value (what neoclassics, inappropriately adapting the term from Classical Political Economy, call also use value) is created. But this subjective value does not and cannot constitute wealth because it is not measured against the subjective values produced by other labourers. Only (subjective) values in exchange only those consumption goods that can be exchanged with the consumption goods of other labourers - can be said to constitute Objective Value to the extent that their value is validated by their exchange in the market being priced against other values-in-exchange.
In connection with the discussion about the admissibility or possibility of introducing psychological factors into economics there stood the question of a standard of value. This question became essential as soon as the theorists saw the excellent objective measure of labour vanish. Even before Smith people had discussed the question of a standard of exchange value and it had been recognized that there could be no standard that was unchangeable in itself. All the classical writers taught this, while the old supporters of the theory of value in use, as e.g. Say, insisted on equating the exchange value of a commodity simply with the quantity of goods which it was possible to obtain for it in the market. It was, however, simply considered impossible to measure the value in use, although in practice everybody definitely compares values of commodities with each other. The psychological theory of value now seemed to demand such a standard of value in use also in economic theory. Against this doubts were raised whether it was substantially possible to measure 'quantities of intensity' and in particular whether valuations of different people could actually be compared. Yet 1 Cf. Bhm,Bawerk,'Exkurs' IX in the third edition of the Positive Theory HISTORICAL SCHOOL AND MARGINAL UTILITY 193 there is really no need for such a comparison and in measuring the valuations of one person it is quite possible to proceed merely from facts that can be observed if we start from the following formulation: The value of a quantity of a commodity for somebody is measured by that quantity of another commodity which makes the choice between both a matter of indifference to the economic individual. (Fisher, Mathematical Investigations into the Theory of Prices, 1892.) This method of basing the measurement of values on acts of choice of the individuals gained more and more adherents (Pareto, Boninsegni and others). Yet it is possible to overcome the difficulties of the problem also in a different way.1 The primary fact with which the theory of marginal utility is concerned and in which its fundamental achievement consists and on which everything else is based, is the proof that in spite of appearances to the contrary the factor of wants and as a result from this the utility character of commodities determine all individual occurrences in the economy. At first it was necessary to deal with the old antinomy of values, the opposition between utility and value. This had already been done. The distinctions between categories of want and the incitement of want, between the total value

of a store and the value of partial quantities of which the store held by the economic individual is composed, help to overcome this opposition. In this lies the importance of the conception of 'marginal utility'.2 Thus all facts relating to the determination of prices could be explained with the help of the basic principle. . in cases in which somebody estimates a commodity according to the value in use of commodities which he can obtain for it in the marketsubjective exchange valuethe 'exchangeability' and with it the subjective exchange value is based on alternative estimates of the value in use. This led to a uniform explanation of all occurrences in the exchange economy with the help of one single principle and in particular also to a classification of the relation between costs and prices.1

(Schumpeter, Economic Doctrines and Methodology) But in order to produce values-in-exchange, the labourer has to utilize tools that will enable him to produce more than is needed for the satisfaction of his bodily wants. And this can be achieved only by diverting labour to the production of tools in substitution of consumption goods. This roundabout decision then and not labour itself or devotion to labour as understood by the Protestant Work Ethic and the Labour Theory of Value - represents the real Entsagung, the true renunciation, and the true source of greater wealth. For the negatives Denken, therefore, wealth does not consist in consumption but in production of valuesin-exchange.
Indeed, it is possible for us to anticipate at this early stage the important realization made first by Hayek and more recently by Hahn that because objective value for Neoclassical Theory can consist only of strictly subjective information offered by individuals about their individual utility schedules, it can then to and be theorized as an economy of information (Hayek) or as an exchange of ideas and actions specifying the instantaneous utility schedules of market agents. In this scheme, time is taken as a

be concluded that a neoclassical economy in equilibrium would amount to and can certainly be reduced (Hahn). Such an equilibrium economy can even be given a temporal dimension, but only formally, by purely formal entity that can be discounted for future calculation. (Bohm-Bawerk suggests that even uncertainty can be arbitraged away!) Because wealth is interpreted by Neoclassical Theory as a uniquely subjective entity that has only a nominal and relative manifestation in exchange between individuals indicated by market prices, then it follows that in equilibrium this exchange is purely an individual wealth in accordance with the utility schedule of each individual market agent. Because exchange of information or of signals as to what would be the optimal exchange of existing subjective exchange occurs instantaneously, it can then be said that no real exchange of material goods need ever

take place except virtually, that is, as an exchange of ideas and actions (Hahn) or information

(Hayek). In a neoclassical economy wealth cannot be aggregated socially because it exists always and

forever as subjective estimation, which is why no real money can exist as a store of value. Wealth or welfare can only be compared relatively as in Pareto optimality. Even Pareto optimality can be assessed

only once all exchanges are concluded and the present endowments or utility schedules of each intersubjectively but only on the basis of such individual utility schedules.

individual are visible and fixed, that is to say, final. In any case, wealth cannot be estimated

B. The Problem of Co-ordination: Market Prices and Labour Values as Meta-physics. Stigler in his formidable review of utility theory insightfully denigrates from the point of view of Neoclassical Theory this Smithian position as the Scotsmans greatest fallacy: labour cannot produce wealth or be the measure of exchanged wealth or value in exchange because wealth is not the socially objective quantitative sum of use values meant for exchange but rather their valuein-exchange which is a purely qualitative subjective estimation, a function of utility, whose sole objective manifestation and calculation or valuation can be obtained only through observable market prices.
Drawing upon a long line of predecessors, Smith gave to his immediate successors, and they uncritically accepted, the distinction between value in use and value in exchange: The word VALUE, it is to be observed, has two different meanings, and sometimes expresses the utility of some particular object, and sometimes the power of purchasing other goods which the possession of that object conveys. The one may be called "value in use"; the other, "value in exchange." The things which have the greatest value in use have frequently little or no value in exchange; and on the contrary, those which have the greatest value in exchange have frequently little or no value in use. Nothing is more useful than water: but it will purchase scarce any thing; scarce any thing can be had in exchange for it. A diamond, on 308 GEORGE J. STIGLER the contrary, has scarce any value in use; but a very great quantity of other goods may frequently be had in exchange for it.2 The fame of this passage rivals its ambiguity. The paradox - that value in exchange may exceed or fall short of value in use - was, strictly speaking, a meaningless statement, for Smith had no basis (i.e., no concept of marginal utility of income or marginal price of utility) on which he could compare such heterogeneous quantities. On any reasonable interpretation, moreover, Smith's statement that value in use could be less than value in exchange was clearly a moral judgment, not shared by the possessors of diamonds. To avoid the incomparability of money and utility, one may interpret Smith to mean that the ratio of values of two commodities is not equal to the ratio of their total utilities.' On such a reading, Smith's statement deserves neither criticism nor quotation. This passage is not Smith's title to recognition in our history of utility. His role is different: it is to show that demand functions, as a set of empirical relationships, were already an established part of economic analysis.

From the jusnaturalist viewpoint of Smiths and Webers Protestant Ethic, wealth as capital is a dependent quantitative function of labour productivity. For them the market mechanism can only serve to facilitate the exchange of goods, but cannot determine the intrinsic substantial value of goods measured by the amount of labour-power they contain. This is a rationalist and humanist worldview in which human labour has a creative universal role in the world that makes all exchange values comparable and measurable, that is, homogeneous (Hegels dialectic of selfconsciousness and Marxs materialist elaboration are perhaps the highest expression of this Judaeo-Christian onto-theology).

Yet from the positivist perspective of Neoclassical Theory (which Smith also paradoxically promoted and probably founded) all wealth is subjective: there are no use values that are universally recognized as serving human needs and wants. Rather, use values and wealth can be objective (that is, be socially recognized) only through the relative estimation of their value-inexchange by market agents as displayed in market prices because only these market agents can determine subjectively the value in exchange of goods sold on the market. For Neoclassical Theory there can be no distinction between use values and exchange values because all Value is Subjective Value; and Values can become objective only to the extent that they are exchanged by means of prices fixed on the market. Consequently, for Neoclassical Theory use values as the universally recognized qualities of goods for human beings whose prices are then determined by the amount of labour necessary to bring them to market (to pro-duce them) simply cannot form the basis of economic analysis only observable market prices can. If it were at all possible to calculate scientifically the amount of labour time socially necessary for the production of a given good, it would then also be possible to decide scientifically the just distribution of the value produced according to the labour time expended. Yet this objective value independent of market prices is precisely what Neoclassical Theory denies is possible! For the Protestant Ethic and for the Labour Theory of Value, all wealth is objective; wealth is the totality of use values and is inseparable from human existence, and neither is the labour that forms the substance of exchange values. Indeed, given the homogeneity of all exchange values as products of and measurable by labour, Classical Political Economy identifies Value with exchange value because exchange values vary in relation to the labour that is embodied by goods on the market. Thus, use values are not omitted from economic analysis but are simply replaced by their labour content. In total contrast, neoclassical theory omits use value from economic analysis because all use values are seen as being strictly subjective and therefore the only objectivity possible for goods, their Objective Values, are the observable prices in market exchange. Thus, neoclassical theory can eliminate the notion of Value from economic analysis altogether and merely concentrate on market prices! The only reason why utility is retained by Neoclassical Theory to explain market prices, even if only as marginal utility, is precisely to emphasise the subjectivity and metaphysical character of use values as adopted by Classical Political Economy. And yet, if use values and labour as the substance of exchange values (that is, exchange values as the amount of labour required to bring their use values to market) are meta-physical because they are un-observable, then utility is equally meta-physical! Neoclassical Theory acknowledges that utility is a metaphysical notion; but then it simply attributes to prices the quality of showing this utility at the margin, that is, at the point of exchange between individuals. (The vulgarity, first, of taking prices at their face value, as the positivistic verdict of the market on the value of goods, and second, of assuming that individuals constitute the basic and decisive economic decision-making agents that determine prices - is the reason why Classical Political Economy referred to the early exponents of Neoclassical Theory as vulgar economists. Cf. Rowthorn essay in CC&I. Also Marx, Cap.1 at pp174-5, fn.34:
Let me point out once and for all that by classical political economy I mean all the economists who, since the time of W. Petty, have investigated the real internal framework [Zusammenhang] of bourgeois [175] relations of production, as opposed to the vulgar economists who only flounder around within the apparent framework of those

relations, ceaselessly ruminate on the materials long since provided by scientific political economy, and seek there plausible explanations of the crudest phenomena for the domestic purposes of the bourgeoisie. Apart from this, the vulgar economists confine themselves to systematizing in a pedantic way, and proclaiming for everlasting truths, the banal and complacent notions held by the bourgeois agents of production about their own world, which is to them the best possible time.)

From the empiricist and mechanistic worldview of Neoclassical Theory, human beings behave like any other objects in nature they are not free ontologically but only selfish; their free-dom is the mechanical inertia of the self-seeking individual in conflict with other individuals and with the rest of the natural world. The founders of this empirical-mechanical positivism were unquestionably Thomas Hobbes and Arthur Schopenhauer in whom we find the most coherent and extreme exposition of what is the truest expression of the bourgeois view of the world. From this anti-humanist perspective, Nietzsche in particular will attack the jusnaturalist link between pro-duction of goods and ownership of those goods (!) just as Weber will attack the nexus between production and ownership of the means of production (in PuR, pp.146-7 and Sozialismus, p.281 of CPW, see our discussion in Weberbuch 1). Both these links, of course, form the very essence of all humanist and socialist philosophies. The universe of Classical Political Economy, of the Labour Theory of Value and of the Protestant Work Ethic is still a Newtonian ordered cosmos, a universe of absolute objective dimensions; the world of Neoclassical Theory is instead the Machian uni-verse of psychological inputs or sensations (Empfindungen) that are strictly metaphysically private and subjective, and can be rendered social and objective only by human convention of what remain absolutely private sensations or estimations. In this regard, Machism and Neoclassical Theory deny all relevance to metaphysics as the positing of a reality that goes beyond what is immediately perceived by each individual. From this perspective of methodological individualism, the principal problem of economics becomes the problem of economic co-ordination (Hayek, Loasby). The negatives Denken decries and denigrates the notion that labour or anything other than the market exchange mechanism and its prices can provide the social synthesis that allows a society to co-ordinate the activities of its members. For the negatives Denken, Nature is not the essential universal sphere of objectification for human beings, whether individually or least of all collectively, but rather it is treated as a quarry whose resources are unavoidably rendered scarce by the impossibility of human subjective individual wants ever to be fulfilled or satiated as well as by the fact that individuals are in competition with one another to provide for these insatiable individual wants. Wealth is an entirely subjective estimation of nature by single individuals, it is Subjective Value (B-B) and is incapable of objective intersubjective use or even of agreement. What is objective about wealth is not its use value or the labour-content of values in exchange, as it was for Classical Political Economy. Rather it can only be its value in exchange between individuals as determined by the wholly independent competitive exchange of goods in the market at rates that constitute their prices. Nature and wealth therefore do not have a universal human value, but only a subjective individual value whose objectivity is given only by the exchange of goods for subjective estimation as manifested by market prices. The market, not labour, is what makes otherwise

wholly Subjective Value become Objective Value. From the perspective of the negatives Denken, labour also cannot be a uniform homogeneous commensurable substance that can be embodied in a universal wealth or indeed any kind of wealth, whether use value or exchange value. Labour simply cannot provide the social synthesis, that is to say, the material coordination of human interests the material inter esse or comunitas, or even the spiritual summum bonum or social goal that commonly constitutes the social fabric. Rather, this social synthesis or co-ordination is provided by the market mechanism through the exchange of endowments owned by entirely self-interested atomistic individuals through the fixing of market prices that are the only visible and material manifestation of their utilitarian preferences. So long as labor was seen as the homogeneous direct creator of homogeneous wealth, then clearly the aim of production had to be the equitable distribution of wealth in direct proportion to the effort of each labourer. But once labor and wealth are seen as individually subjective notions, then the aim of economic coordination through the market mechanism can be only the redistribution of wealth in proportion to the initial endowments of market agents at Equilibrium where capital too constitutes an independent claim to such distribution! The principal difficulty of Classical Political Economy was always that of justifying how capital could constitute an independent claim to wealth once labor was acknowledged as the only source of wealth. Neoclassical Theory overcomes this difficulty by reinterpreting the entire metaphysics of labor and wealth-creation or value. What leads to the creation of Objective Value is the will of the capitalist to accumulate wealth by producing for Objective Value, for value in exchange. The aim of the capitalist is therefore the delay of the immediate production of consumption goods in exchange for that of production goods that will allow him to produce ultimately consumption goods with which to purchase the labour of other workers. Right from its beginnings, then, capital is intended as a will to power (Schumpeters will to conquer) over the living labour of other human beings. Capital is not a pile of tools nor is it merely a quest for wealth in the abstract, but rather capital is the very projection into the future by the capitalist of his will to power over living labour through self-abnegation, through self-denial seen as ascetic self-restraint and sublimation of want - through renunciation. It is entirely evident here how the Entsagung of the negatives Denken and neoclassical theory differs from that of the Protestant Ethic. For the latter, labour is productive of wealth and both can be and is intended to be a pious renunciation of consumption in itself. For the former instead labour is always and everywhere a form of consumption of wealth and therefore cannot be by itself a renunciation even when it is more productive. For the Protestant Work Ethic, the devotion to labour as expiation, toil and parsimony was in direct contradiction with the accumulation of wealth as eudaemonistic self-interest. For the negatives Denken, instead, self-interest becomes self-denial that is entirely consistent with the interpretation of capital as will to power!

The economy intended here is not one that furthers human interests understood collectively as a universal reality shared by all being human, but rather it is an economy that is purely instrumental in character and therefore can serve only the interests of human beings taken as in-dividuals and not collectively. We will see soon that the very notion of utility that subtends all neoclassical economic theory is and must be based entirely and exclusively on the in-commun-icability of private utilities. And because private utilities (a pleonasm) are incommunicable, the only manner in which these utilities can be measured is objectively, that is, through their observable manifestation in market prices. Utility therefore does not explain prices for the simple reason that in neoclassical economic theory prices are the ultimate facts that allow of no further explanation. Whereas classical political economy sought to discover a reality behind prices that could enable the maximization of welfare as measured by a universal substance that is, labour or labour-time or labour-power -, neoclassical theory does not admit of any such universal substance or source of wealth. Neoclassical theory understands wealth in purely subjective terms and that is why prices must be the sole and ultimate manifestation (not explanation!) of (individual, subjective) utilities. Webers notion of the Problematik der Sozialismus consists precisely in this: - that the riddle of the rationalization of the economy and society and the preservation of freedom is one that belongs properly to socialism and not to market capitalism (though perhaps Schumpeter may add monopoly capitalism). Socialist planning is not a problem for market capitalism; rather, it is the other way around! Capitalism is the problem for Socialism because it shows that the only way to act rationally is by allowing the free-dom of social conflict over need-necessities through the market, which is what Socialism wishes to eliminate! For Weber, the problematic of socialism is the impossibility of reconciling choice and rationality, freedom and science, except from the choices and free-dom of in-dividuals! This is the truth of Webers methodological individualism. Paradoxically, it is Weber and Hayek (and Mises) who end up on the side of individual freedom of choice by denying that there is any scientific roadmap to market equilibrium for the precise reason that such a roadmap would depend on the information supplied by freely-choosing individuals in complete antithesis with the planned-society tenets of the Sozialismus based on the Law of Value. Hayek of course applies the same critique to totalitarian Walrasian equilibrium. If the Law of Value is given an objective quantitative form, as every socialist wishes ardently to do, then there will be no space for that subjective Law of Value that is the common basis of both the negatives Denken and neoclassical economics! Without the social conflict of the latter springing from individual need-necessities and related choices, no proper science is possible without the last vestige of free-dom (market freedom) evaporating. For Weber, market free-dom begins precisely with the

expropriation of workers from the means of production, with the Trennung intended as a pro-duct of the stahlhartes Gebaude. Then it continues with the discipline of the factory, on which the exact calculation of profit is based.

Lowith seems to argue that Weber is either seeking to reconcile these opposites or else that he harbors illusions about being able to do so! But we know that neither is the case because in this exact respect market capitalism represents for Weber the apex of both human free-dom and scientific rationality.

The obvious antinomy between science and choice is something that neither Robbins nor the early Hayek detected in their oxymoronic description of economic science as the science of choice or the Pure Logic of Choice. Hayek will later perceive the inconsistency in this approach in connection with the debate over socialist economic planning. Like Weber, this Machian strand of the negatives Denken theorises the conflict of interests between individuals as a divergence over scarce - that is to say, commonlysought, com-petitive - resources. The difficulty is that to the extent that resources are scarce they reveal a common interest that is incompatible with conflict as an unqualified concept. And to the extent that there is unqualified conflict or universal Eris, it is impossible for this to be resolved, even through com-petition, because this requires agreement over the conduct or rules of this com-petition. The outcome can be decided either belligerently through endless war or else, if agreement is possible, cooperatively through science, given that the conflict itself reveals a common interest a com-petition in and for these resources. Indeed Weber does not spare even science from this com-petition because its direction is determined by values whose ultimate rationality *Wert-rationalitat] cannot be de-fined. And yet science needs to retain a degree of epistemological autonomy if it is to be worthy of the name and this for Weber is the rational scientific relation between ends/values and means [Zweckrationalitat]. The problem with all of these positions is that it is impossible to separate scientific means from the value ends themselves because science itself is a means devoid of all epistemological autonomy as against political activity! (To an extent, Hayek came to realize this difficulty in his attacks on scientism and with his notion of spontaneous order.) And therefore science is inseparable from values because it is itself a value *Nietzsches will to truth, which Lowith misunderstands as applying merely to philosophy, to truth as an absolute value, and not to science itself! P.43+. As such, science becomes a

political project or activity with given intentions by its practitione rs over other human beings. But at this precise point it loses its scientificity and turns into political practice.

(This also is the entire tenor of Schumpeters approach to socialism in C,S and D where in fact the Austrian seems to accept an evolutionary transition from market to monopolistic capitalism, and then to socialism. This is something that Weber and Hayek deny ferociously! Cf. here also Schumpeters high regard for Walras as the greatest economist for precisely this Machian reason: - the price mechanism maximizes the satisfaction of individual human needs human needs taken from the point of view of atomized human beings! - at equilibrium [TGE, p.79]:
The whole of pure economics rests with Walras on the two conditions that every economic unit [each individual] wants to maximize utility and that demand for every good equals supply. All his theorems follow from these two assumptions.. Whoever knows the origin and the workings of the exact natural sciences knows also that their great achievements are, in method and essence, of the same kind as Walras'. To find exact forms for the phenomena whose interdependence is given us by experience, to reduce these forms to, and derive them from, each other: this is what the physicists do, and this is what Walras did.)

Let us take a closer look at the reasoning of the Neoclassics, starting with Bohm-Bawerk.
The reason why economists failed in this simple task [of defining Capital] was that they did not allow the facts to speak for themselves. Instead of simply describing them as they were, explanations were read into them and added to them; one feature was pushed into the foreground, another kept in the background, a third was quite overlooked, while perhaps a fourth was entirely absent, but was read into them. When every man had thus imported his own particular views bodily into the facts, it was, of course, no wonder that everybody got something different out of them. (The Positive Theory of Capital. II.1.4)

The facts speak for themselves. Eugen Bohm-Bawerk, the bourgeois Marx, had already demolished the labor theory of value by uncovering its metaphysical premises. The Value of goods sold on the market their prices is the immediate fact, the empirical phenomenon that needs to be described and not explained. The task of economic science, as with the physical sciences, is not to explain phenomena but to link them together in a manner that makes them visible and predictable so as to let the facts, the phenomena, speak for themselves, without the aid of an explanation that must be superfluous and redundant. The market price is not a phenomenon that can be explained with a sub-stance, an es-sence, a hypo-stasis a whatness or reality that stands behind or under or inside the phenomenon. Such essentialism or substantivism as is proffered by the labour theory of value that seeks to go behind and beyond the empirical facts of market prices can be nothing more

than pure meta-physics, sheer confabulation, pure fantasy. Esse est percipi: what you see is what you get. Economic science must be a theory that allows us to place the phenomena in a regular and predictable relation with one another so that they can be described mathematically. And this is exactly what the new theory of marginal utility developed by Heinrich Gossen first, then by Stanley Jevons and by Karl Menger in Vienna where Bohm-Bawerk taught, and so did Ernst Mach, the scientist behind this empiricist Berkeleyan philosophy of science allows us to do. The price of a good cannot tell us anything about its objective amount of value or utility because the law of supply and demand tells us only what the actual, real, visible valuation of goods is by market participants. Therefore, the price of a good can indicate only the relative and subjective utility of that good to its sellers and purchasers: a utility obviously not measurable in quantities but in terms of the subjective utility of the last marginal quantity offered in exchange for another good. The total utility of a good can be measured not cardinally but ordinally in relative terms calculated at the margin of exchange. Prices thus indicate the marginal utility of a good to its seller and purchaser relative to all other goods exchanged on the market. Utility theory is therefore meta-physical in two important related respects: first, utility cannot be observed or measured intrinsically (just as space and time cannot because their measures have little to do with their substance Menger) because it is an entirely psychological entity; and second, a fortiori, marginal utility involves a counter-factual (Sraffa) in that it relies on utility gained or foregone for each price change. Marginal utility indicated by market prices is not a substance that can provide a social synthesis, an inter esse as did labor in the socialist metaphysics. Market prices represent only the subjective valuations of market participants. They unite only in their dividing human experience into incommunicable individual sensations that can be connected, syn-thesised socially only in their empirical manifestations. Individuals co-ordinate choices only in their self-interest, only in their atomicity. Unlike the totalitarian nightmare of collective socialist planning, the market mechanism allows the free competition of self-interest the unplanned spontaneity of individual choice. The great merit of economic science, it is claimed by its chief ideologues, is to have shown that an equilibrium is possible, that it can exist at least mathematically without the Smithian invisible hand. But such existence is a pure abstract mathematical identity that has no substantive value or meaning whatsoever. Its value is purely instrumental. As we have established in our work on Nietzsche (what we have called Nietzsches Invariance), the laws of mathematics are pure formal identities (tautologies) that have no practical content and can have practical content only by losing their status as formal identities. Machs suggestion (in The Economic Nature of Physics, recently re-proposed by Patinkin) that their content is the saving of time runs up against Nietzsches (implicit) and Wittgensteins (explicit) objection that saving time is a substantive practical content entirely logically independent of the sole truth or value of mathematical identities their being exclusively formal logic (what Arendt calls, wrongly, their irresistibility in The Life of the Mind)! In other words, the abuse of mathematics to show the rationality of human choices in terms of adopting means to stated ends (something that Weber defended) is abusive because mathematical identities cannot by definition have any practical value in terms of rationally justifying any human course of action

whatsoever. Mathematics is empty or meaningless when formal or pure and false as identity when applied: it is barren when pure and impure when fertile.

[Marx was entirely right, reprising Hegel, in the Paris Manuscripts to highlight this antithesis between labor-as-poverty or need already evident (long before it became dis-utility for the Neoclassics) in Classical Political Economy, and money-as-wealth in the inverted world of commodity production (or fetishism). Hannah Arendt, again in On Revolution (ch.2, The Social Question, p.63), makes the fundamental mistake of misrepresenting Marx (!) as the avenging peoples tribune of this distorted notion of labor-as-poverty turning into the blind rage of revolution forgivable perhaps if one considers the crude statements in the Communist Manifesto, but entirely philistine and vulgar when the rest of Marxs work is canvassed. Her poverty of philosophy is to mistake Marx for Proudhon, the utopian author of Philosophie de la Misere. That poverty and freedom are two different concepts is blatantly evident. But that Marx ever made the mistake of confusing deliverance from poverty with freedom when in fact he was stating merely that freedom offers very little solace to those who are poor, is an accusation unworthy of Arendts otherwise admirable intellect. Again, we will look at this important question when we discuss Webers political sociology in Part Three.] Only once we have comprehended this reversal (Um-kehrung) of the specifically bourgeois economic ethic that is operated by Neoclassical Theory is it possible for us to solve Webers riddle his inability, even in the final paragraphs of the Vorbemerkung, to account for the spirit of capitalism as the devotion to labour [as a] calling which is, as we have seen, so irrational from the standpoint of purely eudaemonistic self-interest (p.78). Indeed it is! If we interpret the spirit of capitalism as Weber does as the devotion to labor as an ascetic end in itself!
Rationalism is a historical concept which covers a whole world of different things. It will be our task to find out whose intellectual child the particular concrete form of rational thought was, from which the idea of a calling and the devotion to labour in the calling has grown, which is, as we have seen, so irrational from the standpoint of purely eudaemonistic self-interest, but which has been and still is one of the most characteristic elements of our capitalistic culture. We are here particularly interested in the origin of precisely the irrational element which lies in this, as in every conception of a calling. (Vorbermerkung, pp.75-8).

In the negatives Denken, wealth stands against and is the ob-jective of (Gegen-stand standing op-posite) labour, not its pro-duct (bringing forth), just as in Schopenhauer the Body and the World are the objectification of the Will, its variance or resistance or polarity or source of strife. Wealth in its form as labor-saving tools or capital employs labour; labour consumes capital to earn its keep (wages or Lebens-mitteln, provisions), to produce in the sense of trans-forming wealth. But here the active part is capital, which is stored consumption or prior saving, whereas labour is the passive (passio, suffering) part, the part that consumes

capital and in consuming affirms the world. Far from being an ascetic means of renouncing the world, then, as it was for the Protestant Work Ethic, labour is instead the most worldly affirmation of the world for the negatives Denken. Capital is consumed by labour after it has been saved by the capitalist: it is delayed consumption hence the time preference theorized by Bohm-Bawerk as the source of interest or profit. Piercing the veil of Maya, seeing through the illusion of striving and labouring, the mortification of the body, the abnegation of the Will is the renunciation of consumption and the preservation of capital-aswealth. As we noted above, these features are lacking in Weber. Above all, the mundanity of wealth, its evanescence, is left unexplained and is yet another inconsistency in the Protestant ethic as a rationale for accumulation as an end in itself in the spirit of capitalism. Why labor at all, when the pro-duct of labor, this presumed mortification of the body, is in fact wealth? By contrast, this evanescence of wealth and its pursuit is the very centerpiece of Schopenhauers system, - die Unwirklichkeit der Erscheinungswelt, the unreality of the evanescent world and of the Will to Life (Simmel, Schopenhauer und Nietzsche, pp.29-30). In that case, Schopenhauers original version of Nirvana as renunciation (Entsagung) of the World and of the Will would be a far more rational goal for Webers innerweltliche Askese. But the spirit of capitalism becomes far more rational if we interpret it as Lionel Robbins does after the Neoclassical Revolution that is, from the viewpoint of a truly specifically bourgeois economic ethic: according to Robbins in his Essay, contrary to Schopenhauer, Nirvana is the satisfaction of all wants! This is the rational conclusion if one sees capitalism as the accumulation of Value and capital intended as labor-saving tools! Devastatingly put, the spirit of capitalism then becomes will to power over living labor projected into the future! The Will and its instrumental reason (Verstand), as understood by Schopenhauer, work reality/actuality, they labour the World, the subject/object of representations, to satisfy a motivation that is a need. This is the operari, the consumption of the World on the part of the Will. Because the Will is the obverse, the psychological analogue, of Kants thing in itself. The ultimate foundation of social life is the system of needs and wants. The ultimate aim and purpose of society is to satisfy these needs and wants that are ineluctably individual. Not only is the individual and its self-interest the foundation of human society, not only is the satisfaction of needs and wants their provision (Bedarf) the essential aim of social life. But also the efficient satisfaction of these needs and wants depends on the rational and systematic organization of free labor. And this free labor is understood as operari, as mere, sheer labor power or force a homogeneous and measurable quantity that does not itself create anything, pro-duce any goods, but rather consumes and utilizes the external world so as to satisfy and provide for its wants wants that are deemed to be as insatiable as the Schopenhauerian Will.

In this operari there is no telos, no qualitas occulta (hidden quality or ultimate cause, Sch., WWR, p.106), no causa finalis in the endless chain of causation (samsara, the cycle of life) that is the veil of Maya (illusion). The Will is the objectification of the Ding an sich: but Work is the motioning of the Body, which is the objectification of the Will: it is meaningless motion (the Wirklichkeit of Vorstellungen), effort and toil dis-utility or pain (cf. Hagenberg on Gossen!). Work is consumption of the World, and in this consuming it does not have utility. Utility is to be found in the things as they relate to the Will as operari, in the pro-duct of work, but work itself is only operari, consumption of the means of work, of the means of production. (This logical sequence may well be why Gossens early Fundamental Law that still privileged labour was untenable for Jevons and his epigones) Although it pro-duces wealth mechanically, the worker or labourer uses the means of production as well as his own body. But whereas the means of production have utility to the extent that they help pro-duce new objects of utility, work itself is an effort to the labourer and is therefore a dis-utility. Thus, work is neither the measure nor the substance of wealth, but rather an expense, a consumption, an erogation of Leid/Kraft (pain/effort). The source of wealth must then be negative: wealth is not pro-duced but conserved, though it can be accumulated; wealth is consumption a-voided or post-poned/delayed: wealth is saving, it is ab-negation, abstinence, the refraining from or delaying of consumption. In this negative perspective, wealth is indeed not infinite but rather indefinite just like Einsteins universe in the sense that, just like energy in nature, wealth cannot be created though it can be conserved, yet at the same time, because wealth is not an absolute quantity but rather a relative utility, wealth can be accumulated. It is impossible to understand Bohm-Bawerk and the Austrian School, starting with Menger, without understanding Schopenhauer. But even in Smith we have the beginnings of this empiricist and positivist philosophy that can be traced back to Hobbes. In Hobbess mechanicism, the living activity of human beings is already described as a Power that can be used and appropriated mechanically. Wealth is not pro-duced by labour, because wealth too is a Power that can subjugate and appropriate the labour of others by means of possessions that are another form of Power. Wealth or possessions (from Latin potestas, power over things) allow their possessors to exercise power or influence over those who do not possess them. Thus, labour is the price (the dis-utility!) that must be paid for the utility of consumption, which is the wealth represented by the Lebensmitteln/Viktualien (food) and the means of pro-duction: these are what give life, the means of life (Lebensmitteln). It is the employer, the owner of wealth/capital who employs, who gives work (he is the Arbeit-geber or employ-er of) the worker; and it is the worker who takes work (Arbeit-nehmer, employ-ee) from the employer. It is not the worker who gives labour in the sense of wealth -creating force to the employer. Furthermore, utility represents analogously the principium individuationis of Schop.s will and its shapeless, protean subjectivity, its fungibility or malleability, hence its exchangeable (Simmel, wechselseitig) character because of its manifestation or objectification in any object or reality or representation (Vorstellung). Not to mention, of course, the insatiable nature of the Will, again analogous to that of accumulation. The attempt to avoid this bottomlessness is what moved Hayek to distinguish the notion of individual from that of in-

dividuum (in CRS). Hence, the notion of utility already constitutes the in-dividual in its unbridgeable, impenetrable subjectivity, whereas labour contains immediately the concept of inter-action, of social labour. Consequently, economic science must start with the concept of utility if it wants to present social life as market exchange between atomized in-dividuals. Any economic theory that begins with labour will eventually encounter the problem that there is no such thing as individual labour and that indeed all labour is necessarily social labour. Thus, prices do not require a search into utilities. Indeed, the very subjectiveness of utility is consistent with the usurpation of the world by the Subject for whom alone the Object is now posed (not exists, for this question is inconceivable given the relation/unity of the Object with the Subject in the Vorstellung, representation). The relationship between Subject and Object is now entirely internalized, introspected away into mere mechanically ordered phenomena because this is the status of Vorstellungen. Reality is now indistinguishable from dream; it is replaced by sheer action or movement or displacement, by Wirklichkeit where the nexus with work/conatus is evident. Ultimately, exchange value or value must be re-translated into command over living labour, into a specific employment of living labour. But the brutally crude fact is that command over living labour (value) is dependent on the political control of use values (including material resources!); and this opens the way to a total re-formulation of the nature and causes of value in terms of the market, that is, in terms of the ability of goods to satisfy individual incommensurable wants. The proto-neoclassics (from Roscher and Knies to Dupuit to Gossen) therefore invert the Classical and Marxist analytical perspective: they easily take the existing relations of property for granted and proceed to calculate empirically the role of the market in satisfying wants given the existing structure of property (endowments). Given this existing structure of property, of endowments, it follows that labour power is a dis-utility in that the worker needs to consume the means of pro-duction, including its body, in order to pro-duce goods that allow its reproduction. The utility of these goods lies in the satisfaction of the workers wants, one of which is survival. The meaning of wealth then is stored resources, delayed consumption: wealth is no longer embodied labour power because this would mean that only labour power can pro-duce wealth. Rather, wealth is renunciation of the immediate satisfaction of wants; wealth is sacrifice or Vernichtung, annihilation/suppression of the Wille zur Leben something that is not done in contemplation but in the active, effective renunciation of the will to life. Nirvana is not a terminus ad quem, a summit, an apex to be reached at the end of an active process. As Schopenhauer explained, such an active search for pleasure will never lead to its satisfaction because the Will to Life is simply insatiable. On the contrary, Nirvana is the active satisfaction or extinction of wants through their renunciation. And this renunciation (Entsagung) is a saving, a delaying of consumption that leads to the accumulation of wealth, of resources, in the shape of future goods produced through the exertion of the Arbeit, of labour by workers whose wants are in need of immediate provision! Not renunciation of this or that want, then: as Robbins insightfully put it, Nirvana is the satisfaction of all wants that is to say, the total extinction of want, which is itself a task as endless as the pursuit of pleasure (Lust) by the Will is insatiable.

[Explain difference between wealth or use value and value or exchange value. This distinction does not exist for neoclassical theory because the two are identified.] Thus, whereas in Classical Political Economy the creation of Value is limited by the amount of labour or labour-power available, in neoclassical theory there is no such upper limit because Value is defined negatively in terms of relative prices that fix the distribution of existing scarce resources that is, resources rendered scarce by the insatiable search of the Will for pleasure! In Classical Political Economy, the demand side (utility) can only determine the allocation of existing labour-power to the production of different use values and their relative market prices (exchange values). In neoclassical theory, instead, the creation of value, its accumulation, is indefinite and depends on the ability of the possessors of endowments to defer their consumption, to delay their gratification. Labour is not an endowment it is simply the means to satisfy need or want; labour is pain or effort that needs to be exerted for the gratification of needs and wants. Roscher and Knies still attribute exchange value in terms of the ability to satisfy wants to goods, the object, to the thing-in-itself. (This is part of the emanationism [Parsonss translation] that Weber criticized as a Hegelian residuum in RoscherKnies.) Therefore, it still makes sense to ask how the goods are pro-duced, and to regress to labour-power or Arbeitskraft. Gossens initial Fundamental Theorem starts from this Ptolemaic perspective because it measures the utility of goods against the marginal utility of the labourpower applied to their production. Later, however, he will invert this perspective to sever once and for all the link between goods as a pro-duct and goods as endowments that are judged/valued according to their ability to satisfy individual wants, and therefore in terms of these subjective individual wants which are inscrutable except through the willingness of people to pay money for them (Dupuit and JB Clark, as well as Gossen). Now labour is no longer the nature and origin of wealth but simply another negative good to be exchan ged for goods with the ability to satisfy the workers wants. Labour becomes, not the source of value, but rather the consumption of value, of the world, of resources (wage funds), and therefore immediate consumption, non-Entsagung, enslavement to the world (mundanity), not deliverance from the world!

Similarly, utility exists only in the relationship of individuals to things and can only be defined materially or objectively in relative prices. The resultant relativism is unlike that of Einsteins theory, but rather more like Schopenhauers Principle of Sufficient Reason according to which causation is an endless chain given to perception immediately, without necessity or contingency. (Cf. Cacciari, Krisis, p.24: Al di fuori di questa analisi [neoclassica di Bohm-Bawerk] non poteva darsi nulla: nessuna misura teorica o legge del valore. I rapporti di valore erano immanenti e relativi alla struttura del ciclo. See also Simmel regarding the Funktionen, d.h. in Relativitaten auf und verdanken sich wechselseitig alle ihre Bestimmtheiten, p27 in Schop. u. Nietzsche. For distinction with Kants absolutism, see p24.) The very subjectivity and ineffability of the notion of utility the utilities of individuals can neither be compared nor measured, they are heterogeneous - gives much greater scope and weight

to the market mechanism as a tool of social and not strictly economic regulation. It is the self-regulation of the market, its ability to reflect the individual choices of members of civil society that determines not just its Economic rationality the maximization of individual utility and of social welfare in aggregate (hence, economics becomes the science of choice) but also its Political desirability, its osmotic function as co-ordination of the free choices of individuals. But here the oxymoron becomes evident: if indeed economics is a science, then clearly it cannot allow its opposite, choice! Here the determinism of economics as a science made mechanical by the conflict of individual self-interests clashes with the ostensible choice of individual market participants. If individual choice must be regulated by all other individual choices, it is evident that one can no longer speak legitimately of individual choice! Here Walrasian general equilibrium becomes entirely totalitarian. Rational choice is an oxymoron because the rationality of an individuals choice is determined by knowledge of the choices of all other individuals. Yet once the choices of other individuals are known, the last remaining individual has no choice at all because his choice will be determined by all other choices! (Cf. Hayek on one side and Walras on the other. - Also Loasby in his major work. It is obvious that the subjectivist notion of utility ultimately clashes with the determinist straitjacket of general equilibrium, especially at a microeconomic level cf. Roschers reservations against the idealist method in favour of the historical one, in Principles of PolEcon. This leads Loasby to distinguish between open and closed systems.) This may be the place to emphasize that utility is a singularly subjective metaphysical (the euphemism used is psychological) notion that can have no meaning outside of its empirical manifestations relative prices. But Smiths notion of wealth is entirely different from utility when he privileges the labour theory of value, which is not dependent on the notion of equilibrium except in the Marxian sense of simple reproduction. The reference to nations gives Smiths notion of wealth a far more sociological and objective flavour than utility. But note also the following in Papadopoulos, Karl Knies:
In the quest to find Karl Kniess contribution to the emergence of marginal utility theory, one can find a reliable source in the writings of Carl Menger himself, the founder of the Austrian branch of neoclassical economics. In Appendix C of his first and most famous publication, Principles of Economics13, Menger makes direct reference to Kniess aforementioned richly suggestive essay on value, criticizing, nonetheless, several parts of his theory, which he evaluates as leading to doubtful conclusions. First, he alludes to Kniess definition of value as the degree of suitability of a good for serving human ends, to which he objects because he says that it confuses the nature of value with the measurement of value: the measurement of value belongs as little to the nature of value as the measure of space or time to the nature of space or time (Menger 1950, p.293). Thus, Menger understands Knies to attribute inherent value to goods, which obviously cannot correspond to the psychology of the newly born (Austrian) neoclassical methodology14. (pp14-5)

The Wille zur Macht in Nature From Newton to Mach

341. The Heaviest Burden.What if a demon' crept after thee into thy loneliest loneliness some day or night, and said to thee: "This life, as thou livest it at present, and hast lived it, thou must live it once more, and also innumerable times; and there will be nothing new in it, but every pain and every joy and every thought and every sigh, and all the unspeakably small and great in thy life must come to thee again, and all in the same series and sequence and similarly SANCTUS JANUARIUS 271 this spider and this moonlight among the trees, and similarly this moment, and I myself. The eternal sand-glass of existence will ever be turned once more, and thou with it, thou speck of dust!" Wouldst thou not throw thyself down and gnash thy teeth, and curse the demon that so spake? Or hast thou once experienced a tremendous moment in which thou wouldst answer him: "Thou art a God, and never did I hear anything so divine!" If that thought acquired power over thee as thou art, it would transform thee, and perhaps crush thee ; the question with regard to all and everything : "Dost thou want this once more, and also for innumerable times?" would lie as the heaviest burden upon thy activity ! Or, how wouldst thou have to become favourably inclined to thyself and to life, so as to long for nothing more ardently than for this last eternal sanctioning and sealing? (GS)

From Schop to Nietzsche:

PATINKIN, DAVIDSON AND FRIEDMAN on Economic Theory and Mathesis: Note in passing this remarkable passage from Don Patinkins The Chicago Tradition at p58: For one of the fundamental facts of the history of ideas is that in general the full implications of a set of ideas are not immediately seen. Indeed, as has been frequently noted, if they were, then all mathematics would be a tautology; for its theorems are implicit in the assumptions made. The failure to see such implications is also familiar from many episodes in the history of economic doctrine: for example, from the tortuous and faltering manner in which the full implications of the marginal productivity theory were developed. Patinkin does not notice that mathematics IS a tautology if we are faithful to his explanat ion as to why it is not one! The mystery to be solved is precisely this (!): how can a tautology tell us anything? Why does it not destroy or eat itself up the way Nietzsche said about a snake biting its tail or Janus entering and exiting at the same time? The reason is that mathematics does not inform us at all yet it is not a tautology!! It is a pure tool, the purest instrument based on ENTIRELY CONVENTIONAL bases. Therefore its application to any reality or human praxis is always false, it is always INEXORABLY an error the most inexorable error of all! - because it deceives us into assuming that the realities we equate are absolutely equal!! So it is not correct to say with Patinkin that all mathematics would be a tautology[IF] the full implications of a set of ideas [were] immediately seen [because] its theorems are implicit in the assumptions made! The usefulness of mathematics is not in the fact that it allows us to work out implications in a mediate (not im-mediate or instantaneous manner)! The usefulness lies rather in the FACT (!) in the PRACTICE! of the conventional assumption of equality of units!! And this assumption is false, because it is either a tautology a nothing , or it is not, in which case it cannot be true! Mathesis is therefore the biggest lie of all! A lie so big that it makes possible ALL values! Just as incorrect is the saying that time is a device to ensure that everything does not happen at once! In point of fact, everything does happen at once for everything happens now, this moment! Things that do not happen now, this moment no longer happen! They are stored in memory, so that, as Nietzsche diabolically perceived, mathematics is possible and laws of nature are impossible precisely because everything draws to its conclusion in the hic et nunc! Time is a convention connaturate with mathesis because its intra -temporal definition (Heideggers now sequence) has nothing to do with time itself, or the intuition of time, or primordial time, which is extra-temporal, as it were just as mathematical equations have nothing to do with the temporal extrinsication of the entities equated! There is a conceptual extrinsication but then there cannot be actual equality! Mathesis is

Janus-faced because it enters as it exits: it is useful only if its equations are un-equal (are applied to life and the world, intra-temporally); but it is tautologous if the equation is purely conceptual. And t his shows that there can be no such purely conceptual equation because it is auto-phagous or a-poretic, it enters as it exits! Small wonder Heidegger posits time extra-temporally as the horizon of Being! And Nietzsche shows what vis inertiae is needed to ensure forgetfulness and how memory requires a countervailing memory of the will (that is, the wills power to impose memory on us!).

An important point with regard to mathematical equations is that truth is not a category even applicable to them. As Nietzsche rightly notes, if truth existed, it would not be noticed! If the definiens is identical with the definiendum, then no adaequatio is possible at all! Therefore equations must either be tautologous be nothing in their form -, or be substantive in their applications, so that 3=1 plus 2 is a tautology at best or simply in-adequate at worst (we should not say untrue, unless it is simply to remind us that there is no truth). Yet the very fact that truth is conceivable, like all values, means that it does not ec-sist, it is not a being or even a proper concept. But the crunch is that because it is possible to have equations that are neither tautologies nor true shows the precise space in which mathesis ec-sists as will to power, as rationalization of the world. And this Will to Power, this place is conceivable only intuitively in Nietzsches notion of time where everything happens at once now! Mathesis would not be possible were it not for the fact that there is no truth. Mathesis, as Cacciari puts it, yields good results so it becomes a matter of (like Jevons in Keyness description) predictions and regularities.

Milton Friedman on Marshallian and Walrasian Methods: The alternative that now appeals to me is that the difficulty is a different approach to the use of economic theory the difference between what I termed a Marshallian approach and the Walrasian approach in an article I wrote many years ago (Friedman 1949, reprinted in Friedman 1953) . From a Marshallian approach, theory is, in Marshalls words, an engine for the discovery of concrete truth. In this view, Economic theoryhas two intermingled roles: to provide systematic and organised methods of reasoning about economic problems; t o provide a body of substantive hypotheses, based on factual evidence, about the manner of action of causes. In both roles the test of the theory is its value in explaining facts, in predicting the consequences of changes in the economic environment. Abstractness, generality, mathematical elegance these are all secondary, themselves to be judged by the test of application (Friedman 1953, pp. 90-91). On this view, there is no such thing as "the" theory, there are theories for different problems or purposes; there is nothing inconsistent or wrong about using a theory that treats the real interest rate as constant in analysing fluctuations in real income; the one theory may be more useful for the one purpose, the other theory for the other. We lose generality by this procedure but gain simplicity and precision. From a Walrasian approach, abstractness, generality, and mathematical elegance have in some measure become ends in themselves, criteria by which to judge economic theory. Facts are to be described, not explained. Theory is to be tested by the accuracy of its assumptions as photographic descriptions of reality, not by the correctness of the predictions that can be derived from it (Friedman 1953, p. 91). If the real interest rate enters one part of the model, it must be used in all, hence it is logically inconsistent and presumably invalid to regard it as a constant for one purpose but as variable for another. Source: The Journal of Political Economy, Vol. 80, No. 5 (Sep. - Oct., 1972), pp. 906-950 Friedman is wrong to say that the Marshallian approach gains in simplicity what it loses in generality because the very generality of the Walrasian-Machian method encompasses the entire subject-matter it theorises, right from its axiomatic and therefore simpler premises, which Mach derived from the most fundamental experiences or sense-data, contra Husserls apodictic introspective method. Friedman is closer to the mark with the photographic description of reality of Walrasian method (its fr ozen-ness in time), which abstracts and generalizes away the

empirical variations from conceptually-derived laws of physical or social reality. In this sense, Machism bears a close resemblance to Misesian neo-Kantism and Mengerian anti-historicism. Note a little later in the piece Friedmans monetarist parallel with Misesian theory disregarding first -round effects of monetary policy in line with Hayeks Ricardo effect approach. Again, the long run, and wealth effect fundamentals take precedence over partial analyses of economic reality in Marshall-Keynes. This shows that Friedman is not so Marshallian after all!

The Wille zur Macht in Nature From Newton to Mach

The Cartesian dichotomy between mechanistic operari and transcendental esse governs the worldview of the triumphant bourgeoisie at the beginning of the seventeenth century with the formation of the Hobbesian state-machinery in Cromwellian England. (See Tronti and our Civil Society 1.) The individual is a Body that is either in motion or at rest. It generates a Force necessitated by its conatus or appetitus that, applied over time, produces and determines its Power. Already with Hobbess Leviathan, published one year before the Principia Mathematica, we have all the physical and political notions (body, motive, momentum, force, power) that will provide the basis of Newtonian mechanics. The space in which bodies move is strictly Newtonian, it is external (the forum externum) as against the internal time of the soul or psyche that perceives passively the bodies in this space and that is determined by the forces in it just as much as are heavenly bodies. Just as we learned to re-interpret the categories of truth and falsehood applied from the standpoint of a historical human society, so can we re-examine the worldview associated with liberal bourgeois society from its contrast with the mythical state of nature or neutral state that Hobbes invokes in order to enucleate scientifically his categories of that bourgeois society. As we have seen, the analytical separation of the categories of truth and science, of knowledge, from those of the structure of society, of its social synthesis that allows its reproduction through social labour and symbolic interaction is not warranted ab initio because and this is the point we wish to establish here following Nietzsche the worldview that a social system generates may well depend not on an objective scientific observation of life and the world but rather on the self-understanding that the social system may have of itself! In other words, it may well be that science itself is not an objective set of tools and instruments that allow us to study social systems but may be itself the pro-duct of a given social system. If it turned out indeed that the very definition or con-ception of science depended entirely on the mode of activity of social interaction of that social system, then we would need to examine the society more closely to understand science rather than the other way around! Make no mistake: this is not a hermeneutic or perspectivist stance because, as we shall see, perspectives are neither neutral nor equal. But the re-interpretation of science will give us a new and powerful vantage point from which to understand and orient our activity in life and the world.

The existential aims of the nascent and rapidly dominant bourgeoisie are dual: one is to assert the freedom of each individual human being from all social ties so as to allow him to alienate his living activity as labour-power to the bourgeoisie already in possession of the means of production. The second is to permit the an-nihilation of the human environment for the purpose of its appropriation by the bourgeoisie to be utilized as further means of production to be worked on by an ever-expanding number of alienated human workers in exchange for a part of the past, objectified living labour, now dead labour, so as to enable their own survival and reproduction on an expanded scale. The capitalist bourgeoisie therefore has the twin aims to assert the political freedom of individual workers with the aim of utilizing and subordinating the human physical and social environment for the purpose of its own economic exploitation subject to the laws of science and economics that rationalize and regulate this domination. In the circumstances, the living activity of each individual has to be defined and rewarded through its exchange with dead labour by separating it not just from the means of production that ensure its reproduction but also from one individual to another, in such a manner that social labour appears as a collage of separate individual labour-powers that are brought together, that are concentrated by the capitalist himself. As a result of this concentration of social labour as individual labours capital appears as an independent factor or power of production without which the production of social wealth and the very reproduction of society could not take place! What compels and constrains capital to expand its own accumulation as dead labour commanding more living labour is the antagonism of living labour itself which compels individual capitals to become concentrated the better to be able to organize and command living labour. It is this process of accumulation of dead labour as capital that is then used to command expanded living labour that characterizes the antagonistic motor of capitalist accumulation and development. At the same time, as is evident, this expanded reproduction of capital and alienated living labour, this accumulation of capital requires an expanded control and dominion over the living and social environment of workers. But because workers are understood and described as free subjects, the means of production and the entire world become potential objects of domination by capital to be exploited for the sake of the expanded reproduction of capitalist society. It is this process that the bourgeoisie comes to define as science. The process of accumulation requires the regularity and predictability as well as the acceleration of the process of production which in turn necessitates the indefinite repeatability of these processes under controlled conditions (what is known as experimentation). Following the logic of free human agent alienated from its object and calculable operari, an opposition arises ineluctably between Subject and Object in which the latter, already separated from the former, becomes the object of experimentation that can be accurately predicted and repeated theoretically ad infinitum and therefore be described and related by means of abstract mathematical laws that, finally, are deemed to explain the observed phenomena that make up the experiments. It is at precisely this point that the necessity of the mathematical relation or description of events that are deemed to be linked causally becomes problematic because the description or

explanation of the causal nexus can never fully describe or capture the necessity of the events that remain in any case separate both in time and in thought. Both the order and the connection between events is problematic because the very separation of observing Subject and causal Object makes it impossible to reconcile with certainty the ordo et connexio idearum with the ordo et connexio rerum. What remains mysterious is whether the order and connection between events belongs to the things themselves, the Object, or whether it belongs rather to the ideas produced by the Subject to describe and explain the events! The very attempt to segregate the discovery of relations between observable events from the practical interest of the scientific observer what Mach calls vulgar and scientific interests con-veniently removes the political interest of the owner of the means of production, the capitalist, from the operation of the process of production that subsumes to itself, dominates and subordinates from the very inception of the bourgeois era the experimental activities of natural philosophers.

The attempt to overcome these obvious deficiencies of Cartesian dualism and Newtonian physics begins with Berkeleys idealism whereby what seems or appears to be external is in reality ultimately re(con)ducible to the internal perceptions or ideas formed in the psyche. There is therefore a picto-grahic notion of the re-presentation of physical events as ideas akin to images that are impossible to con-nect with one another. Leibniz will overcome the difficulty with the windowless monads connected in a pre-established harmony by a Deus absconditus. David Hume, instead, will engage in a systematic skepticism that denies both the necessary connection of images, and therefore of cause and effect between events, and also, more devastatingly, the very presence of an image or idea corresponding to the subject, the ego, that is supposed to be the repository of these images and perceptions! Kants epistemology will seek to address this Humean skepticism but it will still operate within the framework of Newtonian space and time. And the same can be said for Berkeley. In his attempt to divorce the scientific mathematical application of laws to physical events that clearly originated independently of human perception, Schopenhauer will adopt the Berkeleyan idealism of esse est percipi, but at the same time will locate the laws not, as with Kant, in a Pure Reason (Vernunft) that is necessitated by the very human ability to con-nect events in a predictable manner by applying mathematical reasoning, but rather by relegating human mathematical faculties to an intra-temporal Understanding (Verstand) that simultaneously perceives and orders the phenomena that form its representations. Schopenhauer therefore is able to jettison the need to postulate the intervention of a Kantian Pure Reason as a qualitas occulta or causa sui at the very end of the chain of causation! For Schopenhauer the chain of causation is based simply and entirely on the principle of sufficient reason there are con-nections be-tween e-vents be-cause we are able to con-nect e-vents in our very act of perceiving! That is their actu-ality (Wirklichkeit). In other words, what we perceive are not raw phenomena that e-manate from noumena or things-inthemselves and that are subsequently ordered rationally by a Pure Reason that is not intuited but necessitated by the very logic of the mathematical judgements that we make the Kantian synthetic a priori judgements. Schopenhauer does not deny the validity of mathematical laws but relegates them to the level of understanding, to an intuitive level from which

Kant had sought to remove them through the transcendental aesthetic ascending from pure intuition of internal time and external space, to the sphere of the imagination with its Schematismus of the Understanding, and then finally to the empyrean of Pure Reason as the necessary pre-supposition of the very possibility of a priori knowledge made possible by experience and yet independent of it (against Humean inductivism). Schopenhauer adopts Kantian transcendental idealism but refutes the positing of a Thing in itself from which mere phenomena (bloss Erscheinungen) emanate. Instead, he posits the coincidence, the congruence of perception and mathematical synthesis in the principle of sufficient reason so that our perceptions become representations (Vorstellungen) simultaneously ordered by an intuitive Understanding (Verstand). The e-limination of the Thing-in-itself, impossible to penetrate, inscrutable and unknowable, thus allows Schopenhauer to posit the obverse of the Thing, of Kants physical world: in its stead, Schopenhauer substitutes the most interior thing conceivable for us in the World the Will, the one thing that we know best, even though, precisely because it is the qualitas occulta, the causa sui, the Weltprincip, it too is inscrutable and unknowable it is only intuitable. But because it is inscrutable and unknowable, just like Kants Ding an sich, Schopenahuer conceives of the Will as a non-descript, yet unitary entity that acts through the body which is the objectification of the Will. So once more we have and this is the entire basis of Nietzsches objection to both Schopenhauer and Kant, as well as all their predecessors back to Descartes the dualism of the Will as esse or intelligible freedom in that it is not conditioned by any prior cause, and the body which represents the operari which is entirely determined like any other physical body, as Kant himself conceded. This intelligible freedom of the Will is what Nietzsche attacks fiercely and rejects disdainfully as a lie, a trick, a ruse, a mask an Eskamotage,a Verstellungskunst (see quotation below). Leibniz had already objected to this dualism and proposed the mechanical preestablished harmony of the monads by the Divinity. The truly revolutionary aspect of Nietzsches Entwurf is the blunt challenge to Newtonian spacetime that even Mach (or Berkeley and Hume or Kant and Schopenhauer) had not dared to contemplate. Let us see how.

This Ohnmacht of the forma sempre nova e cheia de encanto, semelhante a do mundo onrico vis-a-vis the novo mundo regular e resistente que se ergue diante dele como uma fortaleza is what Nietzsche will confront later once he rejects the humanistic sentimentalism of this earlier late-romantic Grand Refusal. (This is what Vattimo and Heidegger understand Nietzsche to be saying within the revaluation framework. On Heidegger, see the truly wayward [a play on Holzwege and Weg-marken] essay on Lorigine de la pensee by Gadamer, a paean to the Entzauberung pathos about the separation of art, religion and philosophy from science operated by Greek metaphysics now that is a turn!) The later Nietzsche of course would cringe at the thought of how this mysticism (the soul) completely eclipses his search for physio-logical demands!

A distinction must be made between the ostensible or purported objective of an activity and its real motive, the conatus or appetitus or instinct that is its real origin. The motive of every value - every judgement on life, a valuation, a value-positing, and an activity at the same time - must be that it replace the appearance of reality with the truth. Yet the motive for rectifying an appearance is different from the fact that it is an appearance. For even the truth is an appearance in the sense that no definitive, final truth actually ec-sists! It is not just the truth that does not ec-sist error also does not for the reason that it is error. Our perception of life and the world may always be in error: but that is not to say that error actually ec-sists, and the same goes for truth. If truth existed, we would not need to call it truth we would just take each e-vent or happening (Geschehe) for what it is. But to do so we would have to mimetise with life and the world and only living in the moment can do that. Truth and falsehood can ec-sist only in a world in which there are judgements and valuations of life and the world only in a world with con-cepts that introduce a distance between reality and its observation or :idea. Living in the moment (forgetfulness) can be called as the state of unanswerability or unaccountability. It is not evil or good it is extra-moral and extramundane because it is immediate and un-reflected, spontaneous: it is the neutral state or the state of nature. For us to begin valuing we must have a memory of the will, we must exit forgetfulness to varying degrees, depending on the ontogeny of thought. There is no essential difference between appearance and reality, between error and truth, then: they are all judgements. There is only a dif-ference, that is, different practical implications. Truth as a value has practical implications. Indeed, it ec-sists not as such but only as a conviction, and therefore only for its practical implications. It must involve a certain ordering of values and judgements, of convictions. It involves a struggle of convictions. Truth has pre-suppositions that truth is better than appearance or error, for instance. In the neutral state, there is a com-penetration or mimetisation of human existence with the world itself, because life and the world are identical: what lives is part of the world and the world is part of life. This neutral state or extra-moral, extra-mundane and extra-temporal state is one in which the Will to Power has effect just as much as it has effect in the intra-state. But in the intra-state, as a result of physiological demands, as a by-play or inter-action of the Will to Power mani-festing itself in life and the world, certain per-spectives or symbols are developed that pre-tend to account for life and the world in terms of accountability, of responsibility and therefore of blame and guilt and evil and goodness and innocence the distinction is first made between truth and lies. Nietzsche argues here that these per-spectives or Gesichtspunkte or inter-pretations or masks are still real, they are still ef-fective, otherwise they could not have any internal consistency or coherence no predictability or regularity. But Nietzsche does not explain how or why this occurs! At this stage he seems prepared to accept utility as a motivation and a standard. And a distinction arises also not just between truth and falsehood, between knowledge and error, but also between vulgar pursuits done for immediate practical gain or advantage and scientific research engaged in for the purpose of seeking knowledge and truth. The distinction is paramount in Machs approach to science because he is sensitive to the fact that with Schopenhauer and the negatives Denken which includes Nietzsche and Jevons (cited by

Mach in EuI) - the philosophical status of appearance and reality, of phenomenon and noumenon has been radically transformed in favour of phenomena, in favour of sensations and perceptions [Empfindungen]. So much so, that the thing-in-itself, the objective independence of things and reality (res, thing) has been diminished together with the Newtonian and Kantian notions of (external) space and (internal) time. Already, as we saw earlier, Nietzsche and Schopenhauer had dis-solved the physical uni-verse of Galileian and Newtonian science into its phenomenological a-spects, into its perceived manifestations, its representations [Vorstellungen]. The world is not made up of unknowable things-inthemselves. By the very fact that they are unknowable and inscrutable, these things in themselves are mere figments of the imagination: it is simply im-material, a matter of indifference, whether they exist or not. What we know and can know are the sensations, the sense impressions, the phenomena that we can experience and that go up to make our life-world. There is nothing that lies behind or beyond or beneath our experiences, what we call phenomena there are no noumena, no essences, no sub-stances, no hypo-stases, no material Ob-ject (Gegen-stand) op-posed to the (spiritual) Sub-ject. What you see is what you get: esse est percipi. This is the radical, revolutionary inversion of the Newtonian and Kantian universe operated by Schopenhauer first and then amplified and per-fected by Nietzsche and by Mach. A position that goes well beyond Berkeleys by emphasizing the primacy of experience: vivo ergo cogito. [Later, of course, he will reject it strenuously. At this stage Nietzsche sees only the representation, the mask, and therefore the hypo-crisy of society: truth is a metaphor for the conventionalism and hypocrisy of society that covers up its conflicts and arrogates to itself the thing, the sufficient reason (Satz vom Grund). It therefore turns the real world into a fable, which does not mean that the real world disappears. But Nietzsche cannot explain yet how these conventions can be effective, how they can function! He will do so in the later works when the critique of truth and all values becomes far more refined and potent. These perspectives are still an ex-pression and mani-festation of the Will to Power, of life compelling us to have perspectives and views! It is not the case that there is no real world in the sense of a neutral state: it is rather that what we call the real world contains a series of lies that make the reality of the neutral state more palatable to us! Therefore what we de-scribe (but cannot explain!) as the real world is in fact an error in the sense that it hides and masks the operation or mani-festation of the Will to Power (the physiological demands) in the neutral state (the real world of nature and history) which continue to operate by other means in the civil state. The value-lessness or neutrality of this neutral state its un-accountability, its ir-responsibility or innocence is demonstrated by our very ability to describe it with logico-mathematical instruments that are ef-fective (they implement the Will to Power, the physio-logical demands), and that yet are not true because they are pure formal instruments that are either tautologous (identities) or errors (abstractions of the neutral state, therefore not true).]

The analysis then needs to move on to the practice of science to the selection of a scientific method and that of scientific problems to be resolved. The crucial aspect to understand and realize is that the search for truth is a new kind of imposition, a search that leads from the sphere of morality to that of experimentation. But this occurs only to the extent that moral truth seeks to explain the world upon which scientific practices come up with their own explanations that principally had to do with commercial interests. Thus, what is behind science, its propulsor is something other than science or truth itself! So, clearly Nietzsche is reverting back to the neutral state, to the state that Hobbes described incompletely as state of nature when in fact Nietzsche more accurately identifies it as a state of unaccountability [Un-ver-antwort-lichkeit] which is practically how Leo Strauss describes Hobbess state of nature as being non-evil or as Nietzsche would say, extra-moral (both closer to Heidegger who conceives of evil without sin against the moral theology of Schelling and German Idealism). Science and scientific truth itself then need to be interpreted within the optic or the horizon (BGE, aph188) of the Will to Power. To this day scientific research is subsumed under and subservient to commercial, industrial and military uses (cf. Webers WaB and Schumpeter). The much more powerful point Nietzsche will make later is that a particular framework of intersubjectivity, such as the one provided by physico-mathematics, is necessarily an instrument whose neutral conventionality, far from establishing a truth as objectivity or even as inter-esse, characterizes instead the inevitability of domination, of the Will to Power! No perspective is or can be equally valid because each perspective is commensurable with others only in their antagonism. And the antagonism of values can be detected by the very instrumentality of the so-called truth! If the truth itself is a Will to Power, then there is no truth or real world but there is only the neutral world (the state of nature) of (what appears to us as) conflict! (See Cacciari quotes on Unfreiheit and conflict further down.) Even an activity (Wirklichkeit) such as experimenting is not objective because in its very act of experimenting it is taking a perspective with regard to the use and interpretation of life and the world. Nowhere is this more evident than when experiments are conducted on human beings and on societies, as Nietzsche points out in GM. It is at that point that the truth of science is revealed in all its practical implications. [Man would rather will nothingness than not will at all! This is a realization similar to Sartres condemnation to freedom. The Will to Truth originates as Subjectivism with Protagoras but ends with the questioning and undermining of the very notion of Truth.]

The aim of scientific research had always been to dis-cover the truth about nature to be able to penetrate the operation of every thing and everything in life and the world so as to know it as intimately as its being. This cor-respondence of knowledge and being, or the adaequatio of idea and thing (adaequatio intellectus et rei), was meant to give us certainty of knowledge: in other words, truth was seen as the per-fect cor-respondence of knowledge and being, the perfect predictability of life and the world. (Apart from Heidegger, see Mach at p32.) Even the motive of scientific research could be further dis-sected into a vulgar element for practical or

commercial or military purposes and for pure or exquisitely scientific purposes that reflected the purity and dis-interestedness of philosophic speculation the actual pursuit of truth or knowledge as truth (Mach, ch1). But in this very purity of scientific research one can already detect the exhaustion of philosophic speculation: as Ernst Mach put it (p.15, ch1 of EuI), scientists want to arrive there where philosophers begin! Yet the converse is also valid in the sense that philosophers search for a method that may lead invariably to the truth: philosophers want to arrive there where scientists begin! Put in other words, the aims of philosophy and science converge and become identical at the point where both kinds of activity share a methodology, that is, a definition of the right procedure to be adopted in the pursuit or the re-search of the truth. Once the truth and Being are seen as presences, as qualitates occultae, as the nature of things, then it is obvious that the task of both scientific and philosophic inquiry becomes the same namely, the discovery of an infallible methodology for the dis-covery of truth! (Mach, p41.) Science and philosophy therefore suddenly lose their substantive status to become pure methodology a procedure of investigation and experimentation according to logical and mathematical rules that represents an end in itself! (See Mach, p40.) This is how all traditional metaphysics from Plato onwards has become a long practice run for the establishment of scientific research to the point where philosophic speculation abuts onto the territory of science, decreeing thus its own ful-filment and com-pletion (Vollendung). For Mach, the scientist begins (research) where the philosopher ends, so that science seeks to realize practically the goals of philosophy, whereas philosophy begins where science has reached, so that philosophy extrapolates speculatively from the realm of scientific research it inspires! What constitutes nihilism in its incomplete or complete modes is ultimately the inability to live with this de-centredness, with this existential un-certainty that the very objectification of life and the world sought by philosophy and com-pleted by scientific methodology poses for human beings. Even Schellings Angst that throws man off his centre the ec-stasis of ecsistence is still perceived as Angst, under the gravity or gravamen of this existentialist pathos that characterizes all of the negatives Denken from Schopenhauer and Kierkegaard to Heidegger. But what distinguishes Nietzsche from the rest of the negatives Denken, what allows him alone of all its string of philosophers is the realization that this nihilism itself can be overcome if and only if its origin and cause is located immanently in the ontogeny of thought as the expression of the operation of the Will to Power in life and the world! The need for such immanent analysis is what Nietzsche understands and Heidegger does not which is why it is the former that explains the latter rather than the other way around! (For all this, cf. Heideggers initial chapters of The End of Philosophy taken from Vol.2 of Nietzsche. As we argued in the previous chapter, Heideggers quest for Being, even under the veil of a-letheia, offers ample justification for this claim.) At p.45 Mach finally if unwittingly gives the entire game away when he claims that [l]e success justifie notre hypothese de la stabilite, introduite methodiquement pour edifier la science. But at this stage, if success is the ultimate criterion of the scientific application of

methodology, then it is evident that scientific methodology serves purposes (ends and goals) that have very little of the scientific about them! We are left with the initial question of the purpose and meaning of scientific activity that has little to do with truth and everything to do with those vulgar aims Mach deprecated earlier! We are back to Nietzsches accusation of utility in Uber Wahrheit. But we still need to look deeper into this success or utility. Echoes of this sentimental, late-romantic pathos linger on in Nietzsches mature writings in the Gaya Scienza and the Genealogy especially. There he adverts to the abstract hubris of human beings understood generically, without the analytical screen or filter of the Will to Power. For instance, on nihilism Nietzsche laments that with the Copernican revolution both God and Man are de-throned, ejected from their privileged seats in the order of things. Morality itself, under the Church, is not nihilistic because it posits values. But it and its ascetic ideal are selfdissolving because they need to subject themselves to the criterion of truth, which is the adaequatio, and therefore the ri-scontro, com-parison, con-frontation of belief (faith) with events. (See Heideggers enucleation of this in The End of Philosophy, esp. p.24.) Nihilism starts with the Will to Truth, the search for certainty (Heidegger, ibid.) that inevitably degenerates into the Will to Death: the erection of standards to which human beings must measure up as if in a Procrustean bed starts with Copernicus (see GM, Bk.3, Aph.9 on human hubris and 25). In the Uber Wahrheit, Nietzsche laments the human hubris of the Subject pretending to know the Object and of humans masking the reality of the state of nature anthropomorphically, that is presumptuously and hypocritically for convenience. Here he is speaking of man in general. Later, however, he will come to see this mask as Will to Power, an ineluctable form of domination over others (that necessarily operates differentially) not as sheer human arbitrary or velleitary presumption over other living things and over other equally-valid perspectives, but rather as need-necessity! (Vattimo in Oltre il Soggetto, essay 2, completely mis-takes thi point, forgetting that the hubris in Bk3, Aph9 is never advanced as an explanation or origin for the reification of Man but quite evidently as an aspect of it that Nietzsche then proceeds to account for under the heading of the ascetic priest and nihilism, starting from the very next aphorism [!], whereupon he offers the physiological reasons that we are enucleating here.)

Nietzsche soon makes it clear that his analysis of historical developments has changed profoundly from 1873 when the notes on Uber Wahrheit were dictated. Now the imposition of Values as absolutes and the denouement of these idols into nihilism is no longer simply the product of a philosophical or existential process investing man in general (as it appears in Heidegger). Rather, the Will to Truth and the self-dissolution of both Christianity and Science, their degeneration into a Will to Death, are firmly located in the historical physio-logical process of internalization of the instincts of freedom that we described earlier as the ontogeny of thought. Here it is no longer Man who is the object of Nietzsches attention, but rather the antagonism of values and the conflict between human beings, and the domination and overpowering of some human beings by other human beings!