Marx begins with an analysis of the commodity, which he treats as the key to unlocking the mysteries of capitalism. “A commodity appears at first sight an extremely obvious, trivial thing. But its analysis brings out that it is a very strange thing abounding in metaphysical subtleties and theological niceties.” Commodities have a “dual character.” As material things that can be used in different ways in consumption, commodities have use-values. But commodities “are also the material bearers of . . . exchange-value,” which “appears first of all as the quantitative relation, the proportion, in which use-values of one kind exchange for use-values of another kind.” “As use-values, commodities differ above all in quality, while as exchange-values they can only differ in quantity, and therefore do not contain an atom of use-value.” Human labor is “objectified” or “materialized” in commodities. The value of commodities, then, is determined by the quantity of labor, or more accurately, the quantity of labor-time, required to produce them. But this value is not based on the specific labor-time involved in each case, but rather on an average, the “socially necessary labor-time” needed to produce the commodity. Socially necessary labor-time is “the labor-time required to produce any use-value under the conditions of production normal for a given society and with the average degree of skill and intensity of labor prevalent in that society.” But the value of a commodity cannot be found anywhere in its physical being (“We may twist and turn a single commodity as we wish; it remains impossible to grasp it as a thing possessing value”); it can only be expressed through exchange with another commodity. That is, value “can only appear in the social relation between commodity and commodity.” This manner in which value “transcends sensuousness” leads to the “fetishism” of the commodity. “The mysterious character of the commodity-form consists . . . simply in the fact that the commodity reflects the social characteristics of men’s own labor as objective characteristics of the products of labor themselves, as the socio-natural properties of these things. . . . It is nothing but the definite social relation between men themselves which assumes here, for them, the fantastic form of a relation between things. . . . I call this the fetishism which attaches itself to the products of labor as soon as they are produced as commodities, and is therefore inseparable from the production of commodities.” For their initial owners, commodities have no use-values, but have to be exchanged for commodities that do have desired use-values. They are not directly consumed by their producers but exchanged, and the development of the capitalist mode of production leads to a tendency of all commodities being produced for exchange. As exchange historically develops, one commodity becomes a “universal equivalent,” through which any other commodity can express its value. Any commodity can become the universal equivalent, but money (for Marx, gold) ultimately specializes in the function. The process or “circuit” of exchange then takes the form of Commodity-Money-Commodity, or C-M-C: a commodity is brought to the market and exchanged for money, and that money is then used to purchase another commodity. In this circuit, money functions merely as a “medium of exchange.” Money becomes capital, however, when it enters into a process of exchange that takes the form Money-Commodity-Money, or M-C-M, in which money is exchanged with the goal of acquiring more money. Exchanging money for the same amount of money would be pointless, so the second quantity of money must be greater than the original quantity exchanged. That is, the circuit takes the form M-C-M’, in which M’ contains “surplus value” that makes it greater than M. In M-C-M’, the original money offered has been “valorized”: the magnitude of its value has increased through the process. C-M-C and M-C-M’ appear very similar, but there are important differences. Commodity exchange, C-M-C, serves the purpose of acquiring specific use-values. Capitalist valorization, M-C-M’, however, serves the purpose of increasing exchange-value. “[T]he circulation of money as capital is an end in itself, for the valorization of value takes place only within this constantly renewed movement. The movement of capital is therefore limitless.” The circulation of commodities does not add to their value (that is, it does not alter the socially necessary labor-time of their production), so where does surplus value, the difference between M and M’, come from? “In order to extract value out of the consumption of a commodity, our friend the money-owner must be lucky enough to find within the sphere of circulation, on the market, a commodity whose use-value possesses the peculiar property of being a source of value. . . . The possessor of money does find such a special commodity on the market: the capacity for labor, in other words labor-power.” “We mean by labor-power, or labor-capacity, the aggregate of those mental and physical capabilities existing in the physical form, the living personality, of a human being, capabilities which he sets in motion whenever he produces a use-value of any kind.” Historical conditions are necessary for the money-owning capitalist to discover labor-power on the market. Individuals must be free to offer their labor-power temporarily as a commodity, and they must be compelled to do so because they have nothing else to offer on the market. There is nothing natural about this division of society into those who own money and commodities and those who have nothing to offer but their own labor-power. Capitalism is not an eternal form of society but rather a specific, temporary “epoch in the process of social production.” “The value of labor-power is determined, as in the case of every other commodity, by the labor-time necessary for the production, and consequently also the reproduction, of this specific article. . . . Labor-power exists only as a capacity of the living individual. Its production consequently presupposes his existence. Given the existence of the individual, the production of labor-power consists in his reproduction of himself or his maintenance.” The capitalist purchases the commodities needed for production, including labor-power, but it is impossible to discover how surplus value is produced unless one leaves the sphere of circulation and dives “into the hidden abode of production.” Regardless of the mode of production, the labor process involves individuals using their labor-power (and, at a certain point of development, instruments) to form “the materials of nature” according to some purpose. But in the capitalist mode of production, the capitalist strictly controls the process of production, the final “product is the property of the capitalist and not that of the worker, its immediate producer,” and the purpose of the entire operation is the production of surplus-value. Surplus-values can be produced because of a potential discrepancy between the value of labor-power and the value that labor-power valorizes. The capitalist purchases labor-power, paying for its value, i.e., the cost of maintaining it. For the time that his labor-power has been purchased, the laborer “alienates” from himself the use-value of his labor-power. The capitalist appropriates for himself that use-value, which produces more value than the original cost of the labor-power. The difference between the original value of labor-power and the value it produces is the surplus-value. To carry out the process of production, the capitalist must turn some of his capital into “means of production,” such as materials and instruments. Marx calls this part of the capital spent “constant capital” because its value does not change as it is transferred into the commodities produced. The capitalist must also spend the other part of his capital on labor-power. Marx calls this part of the capital spent “variable capital” because labor-power produces more value, that is, it causes the quantity of value to vary. The rate of surplus-value is measured by the ratio of surplus-value (s) to variable capital (v), or s/v (the rate of surplus-value is different from the rate of profit, which Marx more fully treats in volume 3). The higher the rate of surplus value, the more the worker is forced to labor beyond the time necessary for his own maintenance and reproduction. “The rate of surplus-value is therefore an exact expression for the degree of exploitation of labor-power by capital, or of the worker by the capitalist.” One of the primary means through which the capitalist can obtain “absolute surplus-value” is the extension of the working day, which results in more total value being produced without increasing the cost of the labor-power purchased. Left unchecked, capitalism even has a tendency to extend the working day to the point that the quality of labor-power deteriorates and the reproduction of labor-power is undermined. “The establishment of a normal working day is therefore the product of a protracted and more or less concealed civil war between the capitalist class and the working class.” Because there are natural and historical limits to increasing absolute surplus value (the former is the maximum of 24 work hours in a day), capitalists attempt to produce “relative surplus value” by revolutionizing the labor process. The transformation of the conditions of production increases the productivity of labor, so less labor-time is socially necessary to produce a commodity. When productivity is increased in those industries that produce the commodities required for labor’s reproduction and maintenance, the value of labor-power decreases because it costs less to produce the laborer himself. Individual capitalists can also acquire relative surplus value by increasing productivity ahead of their competitors. Adopting new production techniques and technologies allows individual capitalists to produce commodities more cheaply while selling them at the average social value. But competition eventually forces everyone to become more productive, driving down the average social value of the commodities until this ephemeral form of relative surplus value disappears. Capitalism truly comes into its own when production reaches a certain scale and a large number of workers are brought together to labor cooperatively. The exceptional power of the collective workers, unfortunately, is placed under the command of the capitalist, or at least the managers and professionals who eventually come to specialize in this function. The cooperation of workers under capitalism therefore does not lead to the freeing of man’s species being. The workers “enter into relations with the capitalist, but not with each other. Their co-operation only begins with the labor process, but by then they have ceased to belong to themselves. On entering the labor process they are incorporated into capital. . . . Hence the productive power developed by the worker socially is the productive power of capital. . . . Because this power costs capital nothing, while on the other hand it is not developed by the worker until his labor itself belongs to capital, it appears as a power which capital possesses by its nature—a productive power inherent in capital.” The deepening of the division of labor inhumanly forces each worker to carry out only one “simple operation for the whole of his life.” It also creates a hierarchy of skills and a growing mass of “so-called unskilled laborers.” The adoption of machines furthers this deskilling of the worker and ultimately subjects the worker to a labor process determined according to technical rather than human criteria. As constant capital, machines do not produce new value, but slowly transfer their value to the commodities they produce. However, machines do increase the productivity of labor, and therefore decrease the amount of labor-time needed to produce commodities. In addition to potentially decreasing the value of labor-power, machines allow capitalists who first adopt them to obtain relative surplus value until competition forces the general use of the machines. The integration of machines reaches its culmination with the factory. “In the factory we have a lifeless mechanism which is independent of the workers, who are incorporated into it as its living appendages.” Like every mode of production, capitalism must not only produce things but also continually reproduce itself. The “simple reproduction” of capitalism requires the production of a class of workers. “The capitalist process of production, therefore, seen as a total, connected process, i.e. a process of reproduction, produces not only commodities, not only surplus-value, but it also produces and reproduces the capital-relation itself; on the one hand the capitalist, on the other the wage-laborer.” In reproduction on an expanded scale, i.e., the accumulation of capital, some of the surplus product is transformed into capital. As a result, the social basis of production expands and the size of the proletariat grows. The wages of this proletariat even might grow, but they are “confined within limits that not only leave intact the foundations of the capitalist system, but also secure its reproduction on an increasing scale.” As the accumulation of capital progresses, there is a concentration as well as a centralization of capital. The “organic composition” of capital also changes as less variable capital (labor-power) tends to set into action a greater quantity of constant capital (such as machinery and materials). In other words, expanded reproduction ultimately tends to cast off workers who are no longer needed due to changes in the organization of production. “The working population therefore produces both the accumulation of capital and the means by which it is itself made relatively superfluous.” In fact, this “surplus population . . . becomes a condition for the existence of the capitalist mode of production. It forms a disposable industrial reserve army, which belongs to capital just as absolutely as if the latter had bred it at its own costs. Independently of the limits of the actual increase of population, it creates a mass of human material always ready for exploitation by capital in the interests of capital’s own changing valorization requirements.” But eventually, the “monopoly of capital becomes a fetter upon the mode of production which has flourished alongside and under it. The centralization of the means of production and the socialization of labor reach a point at which they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.”
Sunday, March 20, 2011
Karl Marx: Capital Volume I
Marx begins with an analysis of the commodity, which he treats as the key to unlocking the mysteries of capitalism. “A commodity appears at first sight an extremely obvious, trivial thing. But its analysis brings out that it is a very strange thing abounding in metaphysical subtleties and theological niceties.” Commodities have a “dual character.” As material things that can be used in different ways in consumption, commodities have use-values. But commodities “are also the material bearers of . . . exchange-value,” which “appears first of all as the quantitative relation, the proportion, in which use-values of one kind exchange for use-values of another kind.” “As use-values, commodities differ above all in quality, while as exchange-values they can only differ in quantity, and therefore do not contain an atom of use-value.” Human labor is “objectified” or “materialized” in commodities. The value of commodities, then, is determined by the quantity of labor, or more accurately, the quantity of labor-time, required to produce them. But this value is not based on the specific labor-time involved in each case, but rather on an average, the “socially necessary labor-time” needed to produce the commodity. Socially necessary labor-time is “the labor-time required to produce any use-value under the conditions of production normal for a given society and with the average degree of skill and intensity of labor prevalent in that society.” But the value of a commodity cannot be found anywhere in its physical being (“We may twist and turn a single commodity as we wish; it remains impossible to grasp it as a thing possessing value”); it can only be expressed through exchange with another commodity. That is, value “can only appear in the social relation between commodity and commodity.” This manner in which value “transcends sensuousness” leads to the “fetishism” of the commodity. “The mysterious character of the commodity-form consists . . . simply in the fact that the commodity reflects the social characteristics of men’s own labor as objective characteristics of the products of labor themselves, as the socio-natural properties of these things. . . . It is nothing but the definite social relation between men themselves which assumes here, for them, the fantastic form of a relation between things. . . . I call this the fetishism which attaches itself to the products of labor as soon as they are produced as commodities, and is therefore inseparable from the production of commodities.” For their initial owners, commodities have no use-values, but have to be exchanged for commodities that do have desired use-values. They are not directly consumed by their producers but exchanged, and the development of the capitalist mode of production leads to a tendency of all commodities being produced for exchange. As exchange historically develops, one commodity becomes a “universal equivalent,” through which any other commodity can express its value. Any commodity can become the universal equivalent, but money (for Marx, gold) ultimately specializes in the function. The process or “circuit” of exchange then takes the form of Commodity-Money-Commodity, or C-M-C: a commodity is brought to the market and exchanged for money, and that money is then used to purchase another commodity. In this circuit, money functions merely as a “medium of exchange.” Money becomes capital, however, when it enters into a process of exchange that takes the form Money-Commodity-Money, or M-C-M, in which money is exchanged with the goal of acquiring more money. Exchanging money for the same amount of money would be pointless, so the second quantity of money must be greater than the original quantity exchanged. That is, the circuit takes the form M-C-M’, in which M’ contains “surplus value” that makes it greater than M. In M-C-M’, the original money offered has been “valorized”: the magnitude of its value has increased through the process. C-M-C and M-C-M’ appear very similar, but there are important differences. Commodity exchange, C-M-C, serves the purpose of acquiring specific use-values. Capitalist valorization, M-C-M’, however, serves the purpose of increasing exchange-value. “[T]he circulation of money as capital is an end in itself, for the valorization of value takes place only within this constantly renewed movement. The movement of capital is therefore limitless.” The circulation of commodities does not add to their value (that is, it does not alter the socially necessary labor-time of their production), so where does surplus value, the difference between M and M’, come from? “In order to extract value out of the consumption of a commodity, our friend the money-owner must be lucky enough to find within the sphere of circulation, on the market, a commodity whose use-value possesses the peculiar property of being a source of value. . . . The possessor of money does find such a special commodity on the market: the capacity for labor, in other words labor-power.” “We mean by labor-power, or labor-capacity, the aggregate of those mental and physical capabilities existing in the physical form, the living personality, of a human being, capabilities which he sets in motion whenever he produces a use-value of any kind.” Historical conditions are necessary for the money-owning capitalist to discover labor-power on the market. Individuals must be free to offer their labor-power temporarily as a commodity, and they must be compelled to do so because they have nothing else to offer on the market. There is nothing natural about this division of society into those who own money and commodities and those who have nothing to offer but their own labor-power. Capitalism is not an eternal form of society but rather a specific, temporary “epoch in the process of social production.” “The value of labor-power is determined, as in the case of every other commodity, by the labor-time necessary for the production, and consequently also the reproduction, of this specific article. . . . Labor-power exists only as a capacity of the living individual. Its production consequently presupposes his existence. Given the existence of the individual, the production of labor-power consists in his reproduction of himself or his maintenance.” The capitalist purchases the commodities needed for production, including labor-power, but it is impossible to discover how surplus value is produced unless one leaves the sphere of circulation and dives “into the hidden abode of production.” Regardless of the mode of production, the labor process involves individuals using their labor-power (and, at a certain point of development, instruments) to form “the materials of nature” according to some purpose. But in the capitalist mode of production, the capitalist strictly controls the process of production, the final “product is the property of the capitalist and not that of the worker, its immediate producer,” and the purpose of the entire operation is the production of surplus-value. Surplus-values can be produced because of a potential discrepancy between the value of labor-power and the value that labor-power valorizes. The capitalist purchases labor-power, paying for its value, i.e., the cost of maintaining it. For the time that his labor-power has been purchased, the laborer “alienates” from himself the use-value of his labor-power. The capitalist appropriates for himself that use-value, which produces more value than the original cost of the labor-power. The difference between the original value of labor-power and the value it produces is the surplus-value. To carry out the process of production, the capitalist must turn some of his capital into “means of production,” such as materials and instruments. Marx calls this part of the capital spent “constant capital” because its value does not change as it is transferred into the commodities produced. The capitalist must also spend the other part of his capital on labor-power. Marx calls this part of the capital spent “variable capital” because labor-power produces more value, that is, it causes the quantity of value to vary. The rate of surplus-value is measured by the ratio of surplus-value (s) to variable capital (v), or s/v (the rate of surplus-value is different from the rate of profit, which Marx more fully treats in volume 3). The higher the rate of surplus value, the more the worker is forced to labor beyond the time necessary for his own maintenance and reproduction. “The rate of surplus-value is therefore an exact expression for the degree of exploitation of labor-power by capital, or of the worker by the capitalist.” One of the primary means through which the capitalist can obtain “absolute surplus-value” is the extension of the working day, which results in more total value being produced without increasing the cost of the labor-power purchased. Left unchecked, capitalism even has a tendency to extend the working day to the point that the quality of labor-power deteriorates and the reproduction of labor-power is undermined. “The establishment of a normal working day is therefore the product of a protracted and more or less concealed civil war between the capitalist class and the working class.” Because there are natural and historical limits to increasing absolute surplus value (the former is the maximum of 24 work hours in a day), capitalists attempt to produce “relative surplus value” by revolutionizing the labor process. The transformation of the conditions of production increases the productivity of labor, so less labor-time is socially necessary to produce a commodity. When productivity is increased in those industries that produce the commodities required for labor’s reproduction and maintenance, the value of labor-power decreases because it costs less to produce the laborer himself. Individual capitalists can also acquire relative surplus value by increasing productivity ahead of their competitors. Adopting new production techniques and technologies allows individual capitalists to produce commodities more cheaply while selling them at the average social value. But competition eventually forces everyone to become more productive, driving down the average social value of the commodities until this ephemeral form of relative surplus value disappears. Capitalism truly comes into its own when production reaches a certain scale and a large number of workers are brought together to labor cooperatively. The exceptional power of the collective workers, unfortunately, is placed under the command of the capitalist, or at least the managers and professionals who eventually come to specialize in this function. The cooperation of workers under capitalism therefore does not lead to the freeing of man’s species being. The workers “enter into relations with the capitalist, but not with each other. Their co-operation only begins with the labor process, but by then they have ceased to belong to themselves. On entering the labor process they are incorporated into capital. . . . Hence the productive power developed by the worker socially is the productive power of capital. . . . Because this power costs capital nothing, while on the other hand it is not developed by the worker until his labor itself belongs to capital, it appears as a power which capital possesses by its nature—a productive power inherent in capital.” The deepening of the division of labor inhumanly forces each worker to carry out only one “simple operation for the whole of his life.” It also creates a hierarchy of skills and a growing mass of “so-called unskilled laborers.” The adoption of machines furthers this deskilling of the worker and ultimately subjects the worker to a labor process determined according to technical rather than human criteria. As constant capital, machines do not produce new value, but slowly transfer their value to the commodities they produce. However, machines do increase the productivity of labor, and therefore decrease the amount of labor-time needed to produce commodities. In addition to potentially decreasing the value of labor-power, machines allow capitalists who first adopt them to obtain relative surplus value until competition forces the general use of the machines. The integration of machines reaches its culmination with the factory. “In the factory we have a lifeless mechanism which is independent of the workers, who are incorporated into it as its living appendages.” Like every mode of production, capitalism must not only produce things but also continually reproduce itself. The “simple reproduction” of capitalism requires the production of a class of workers. “The capitalist process of production, therefore, seen as a total, connected process, i.e. a process of reproduction, produces not only commodities, not only surplus-value, but it also produces and reproduces the capital-relation itself; on the one hand the capitalist, on the other the wage-laborer.” In reproduction on an expanded scale, i.e., the accumulation of capital, some of the surplus product is transformed into capital. As a result, the social basis of production expands and the size of the proletariat grows. The wages of this proletariat even might grow, but they are “confined within limits that not only leave intact the foundations of the capitalist system, but also secure its reproduction on an increasing scale.” As the accumulation of capital progresses, there is a concentration as well as a centralization of capital. The “organic composition” of capital also changes as less variable capital (labor-power) tends to set into action a greater quantity of constant capital (such as machinery and materials). In other words, expanded reproduction ultimately tends to cast off workers who are no longer needed due to changes in the organization of production. “The working population therefore produces both the accumulation of capital and the means by which it is itself made relatively superfluous.” In fact, this “surplus population . . . becomes a condition for the existence of the capitalist mode of production. It forms a disposable industrial reserve army, which belongs to capital just as absolutely as if the latter had bred it at its own costs. Independently of the limits of the actual increase of population, it creates a mass of human material always ready for exploitation by capital in the interests of capital’s own changing valorization requirements.” But eventually, the “monopoly of capital becomes a fetter upon the mode of production which has flourished alongside and under it. The centralization of the means of production and the socialization of labor reach a point at which they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.”
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