E-M said:
It is absurd to say Marx was unaware of the existence of scarcity. Marx was well versed in the major classical economists and in the history of Europe. An economic category as big as scarcity didn't somehow just miss him.
What Marx contended was that under capitalism scarcity was no longer the driving factor of the economy. In advanced capitalist economies food and shelter no longer become truly scarce. Production has reached a point where we can reasonably expect to feed and house everybody in the capitalist economy. When people can't buy food or find housing it isn't usually a matter of supply, but of demand. In this economy we can see exactly that happening. There is a crisis in the housing market because the demand is outweighing the supply. Tons of food goes to waste in this country because there isn't the demand to buy it.
In its traditional sense scarcity is no longer an issue in the type of capitalist economies Marx described. Thus something beyond scarcity must be used to understand economics. There is no such thing as a scarcity of iphones or computers because they don't serve basic material needs. Instead the production and distribution of iphones and computers is based entirely on social conventions.
Okay, I'll reword - he wasn't ignorant to its existence, but to its function and application.
Food, water, and shelter does exist at a level where everyone can be fed and sheltered, but this is because it is driven by classical macroeconomic policies. Marxist thought eventually leads to stagnation and an internal collapse on itself as time and the world passes it by. A truly Marxist state today would be about as evolved and advanced as America would be back in the pioneer days. Greed has been a driving force for man to advance in science, technology, medicine, and general betterment of society. Yeah, under Marxist philosophy nobody would freeze or starve to death, but those are the only benefits they would have. You wouldn't have that computer you're using unless you traded grain with an advanced society.
While synthetic diamonds haven't been able to match natural diamonds 100% in chemistry or quality Marx's general point seems to stand. Synthetic diamonds that take less average man hours to produce and bring to market are less expensive than natural diamonds.
They fetch less because they're not real diamonds. There has to be intrinsic value applied to the time it takes for the earth to crush carbon into shiny little stones. Having said that, I won't argue this point because I'm not female, and I think arguing over the value of diamonds is really a female thing because they raise the cost through sentimentality and other girly bullcrap.
Marx was following a similar enlightenment tradition that the founding fathers did in his notion of human equality. Humans share basic biological and cognitive qualities that call for a basic equality. That isn't to say every human is equally in literally every way.
This, if you were wondering, is why Marx created the distinction between concrete and abstract labor. In the first few pages of Capital Marx explains that a commodities value is determined by the abstract human labor put into it. The actual concrete labor put into the actual individual commodity produced means nothing on the market side of things. The market doesn't care about how hard you individually worked on something if the average amount of labor put into that type of commodity allows the price to be lower. On the other hand, if you develop a technique which allows you to produce that commodity in less time, you can sell it for less than the average cost. If that technique becomes widespread the average abstract human labor time needed to go into will go down, which will cause it to be valued less on the market.
Of course all of this is only the basic hinge on which Marx thought economics works, not the end all be all of economics that some of his critics claim he thought. To grossly over simplify his arguments and then rashly connect them to distant political movements shows a loyalty to opportunism rather than intellectualism.
This is one of the staples to why Maxism fails. If I spent 3000 man-hours trying to build a rocketship to Saturn with some old crates and chicken wire, does it have real value to society? Of course not. Labor does not automatically equal value, and valuable labor does not have a fixed determinant value. A street-sweeper has less intrinsic value than an engineer, despite the fact that they both perform necessary functions in society, because of the amount of people who can perform each task is quite varied.
Marx was not an economist. He had no original thought that had economic principle, but only referenced classical economics and put a faulty humanistic theoretical spin on it that numbers simply don't back up. He was a philosopher, and that's all. His belief structure systematically fails from a statistical and numerical standpoint.
Honestly I am still working through the beginning of Capital, though I have already several of his other major works (some of his early Critiques of Hegel, Economic and Philosophical Manuscripts of 1844, The German Ideology, the Communist Manifesto, Critique of the Gotha Program, the preface to A Contribution to the Critique of Political Economy). Where I have not read as much of Marx's Magnum Opus as you it seems that I have studied much more or it.
Oh, I'm sure you've studied Marxism much more than I have, because my degree in economics requires a much more broad view and critique, involving some mildly complicated math to determine principles and accepted theories. Marxism was mostly discussed in the 5 minutes before the end of class because occasionally some hippie-student would challenge the professor with some unproven viewpoints and put him on point. My study of Marxism was mostly independent, as
no economics lecturer worth his salt at a major university level would have a student do a report or paper on this subject. That's what liberal arts is for.