Do machines produce surplus value?

 Slight  correction.  He does appear to have gone along with the conventional argument against Marx's views respect to the so called transformation problem"- now put to rest by the good folk from TSSI camp like Kliman and Freeman – but it was not his primary line of attack on Marx. That as I said seems to focus on the question of whether machine produce surplus valueI think the belief that they do is implicit in "Okishio's theorem" – the argument that investing in more machinery must raise profitability otherwise the capitalists wouldnt make such an investment from which it is inferred that machines must ipso facto produce surplus value. 

 Wasnt Marx's argument that the innovating capitalist would attract higher than normal profits to  begin  with but as others followed the rate of prpfit would tend to decline with the overall rise in the organic composition of capital? I understand the point you are making about more capital intensive businesses capturing more surplus value as a result of the averaging of the rate of proft but I suppose Keen would say he is not talking about this but rather about the more fundamental point of whether machines produce value and therefore surplus value .  He would probably say that even with relatively labour intensive businesses, machines still add value to the product  as opposed to simply transfer the value congealed in them over the lifetime of the machine. Intuitively I think this argument doesnt make sense but I am trying to marshall the array of different arguments that can be used against it

A quote from John Ramsay McCulloch, The Principles of Political Economy (5th ed.) [1864] http://oll.libertyfund.org/titles/mcculloch-the-principles-of-political-economy-5th-ed-1864  "That commodities could not be produced without the co-operation of the powers of nature, is most certain; and we are very far, indeed, from seeking to depreciate the obligations we are under to our common mother, or from endeavouring to exalt the benefits man owes to his own exertions by concealing or underrating those which he enjoys by the bounty of nature. But it is the distinguishing characteristic of the services rendered by the latter, that they are gratuitous. They are infinitely useful, and they are, at the same time, infinitely cheap. They are not, like human services, sold for a price; they are merely appropriated. When a fish is caught, or a tree is felled, do the nereids or wood-nymphs make their appearance, and stipulate that the labour of nature in its production should be paid for before it is carried off and made use of? When the miner has dug his way down to the ore, does Plutus hinder its appropriation? Nature is not, as so many would have us to suppose, frugal and grudging. Her rude products, and her various capacities and powers, are all freely offered to man. She neither demands nor receives a return for her favours. Her services are of inestimable utility; but being granted freely and unconditionally, they are wholly destitute of value, and are consequently without the power of communicating that quality to any thing" The implication of this is that value (and hence surplus value) is essentially a social relationship based on generalised commodity exchange.  Machines, like pristine raw materials, do not enter into an exchange with the capitalists but unlike pristine raw materials have labour already congealed in them.  Workers on the other hand , do enter into an exchange relationship with the capitalists.  Labour power is exchanged for a wage.  So there is a qualitiative difference between labour power and machines.  At the end of the day, machines are simply the extension  or amplification of human labour One further point, I think.  Value (and surplus value) is only comprehensible as a concept at the level of the economy as a whole.  As stated, it  is not a thing but a social relationship.  The suggestion that machines produce surplus value is an attempt to "concretise" (turn it into something with "thinglike" qualities) the concept of value by locating it within the confines of the individual business firm employing machinery to raise the productivity of its workforce. This makes no sense in terms of the labour theory of value Finally,  if machines produce surplus value then you could  just easily assert that slaves produce surplus value  (or indeed animals).  But they dont.  Slaves produce an economic surplus  but not surplus value.  I like Mandel's succinct explanation of the difference betrween surplus value and other forms of the economic surplus:   It can take the form of straightforward unpaid surplus labour, as in the slave mode of production, early feudalism or some sectors of the Asiatic mode of production (unpaid corvée labour for the Empire). It can take the form of goods appropriated by the ruling class in the form of use-values pure and simple (the products of surplus labour), as under feudalism when feudal rent is paid in a certain amount of produce (produce rent) or in its more modern remnants, such as sharecropping. And it can take a money form, like money-rent in the final phases of feudalism, and capitalist profits. Surplus-value is essentially just that: the money form of the social surplus product or, what amounts to the same, the money product of surplus labour. It has therefore a common root with all other forms of surplus product: unpaid labour (Ernest Mandel, 1990, "Karl Marx", Marxian Economics, John Eatwell, Murray Milgate & Peter Newman (eds.), London 1990, p.1-38).