## Thursday, 2 August 2012

### Capital I Chapter 1 - Part 4

Section 3

All commodities have a value-form common to them all. That is all commodities' values can be represented in the same way; their Money Form. In other words, any commodity can be represented as so many Pounds, Euros, Dollars or whatever the monetary unit happens to be.

Marx then sets out to discover what its origin is. He says that in plotting the route to this origin we will also uncover the riddle of what Money itself is. We can start by thinking about a situation where money doesn't exist, and so where one commodity exchanges for other commodities in varying proportions. That would exist in a barter system. Marx calls this the 'Elementary' or 'Accidental' Form of Value, where e.g. 20 yards of linen = 1 coat.

But, expressed in this equation are two different things. The first thing, the linen is having its Value expressed, whereas the coat is acting as the unit of measure of that value. The linen is acting here as 'relative value' whereas the coat acts as the 'equivalent'form of value.

The Exchange Value of any commodity always takes this Value Form of being expressed as a certain quantity of some other Use Value. The Relative Form (the linen) and the Equivalent Form (the coat) are mutually dependent and yet exclusive. It is meaningless to say that 1 coat = 1 coat, or to say £1 = £1. It only makes sense if you say something like 1 lb. Of apples = (is worth) £1.

Of course, you can reverse the equation, and say 1 coat = 20 yards of linen. But, then it is the coat whose value is being expressed, and the linen is acting as unit of measurement, the equivalent form against which it is being measured. You can only compare the actual relation between two things if you measure them in terms of the same unit. For example, I can measure the length of a table in feet, and the length of a room in feet. If the table is 6 feet, and the room 24 feet, I know that the latter is four times greater than the former.

You cannot measure linen against coats by any measure such as length, weight, hardness or even utility (because utility varies for each person, and even for the same person over time). You can only measure linen against coats as being embodiments of Value itself. Value, as an abstract concept like length, weight, or hardness are abstract concepts. The fact that a room is four times longer than a table does not in any sense imply that four tables equals one room, other than the sense that they embody the same degree of extension in space-time. 20 yards of linen = 1 coat only in the sense that both embody an equivalent amount of Value. The only quality they have which makes this comparison possible is that of Value.

So, both have the quality of Value, and it is that which allows them to be compared. But, if I state 20 yards of linen = 1 coat, then the unit of Value is coats, and it is in these units that the Exchange Value of the linen is expressed. Just like if I think that people's feet is a useful unit of measurement, I might say 1 table = 6 feet. I would not say 6 feet = 1 table, or 1 foot = 1/6 table.

Length is an abstraction. It is abstracted from the fact that all objects have extension i.e. they occupy a certain quantity of space-time. But, this abstraction can take physical form in the shape of a foot rule, or a standard metre etc. In the same way, Exchange Value can take physical shape in the form of some standard unit of measurement. Here it is the coat.

Both the length of an object, and the Value of a commodity, have a source. What is the source of the length of an an object besides the fact that some contain more, or larger, or less densely packed atoms than others? It is a question better addressed to Professor Brian Cox than to me! But, the source of the Value of the commodity we have already established, it is the fact that the particular commodity is the product of a certain type of concrete labour, and this labour is itself convertible into a given quantity of abstract labour.

Consider light. There are many different kinds of light – sunlight, starlight, candle-light, lamplight, etc. All of these have different characteristics and intensities. Yet, they are all light. What is the substance of the light, what creates it? It is photons. The light from all these sources is made up of identical photons, just as Value is made up of identical units of Abstract Labour-time. The intensity of the light is determined by the quantity of photons, just as the amount of Value is determined by the quantity of labour-time. But, although the photon is the substance of the light, and creates the light, it is not its source. A thing cannot be the source of itself. The source is the Sun, or stars, or a candle or a lamp. Similarly, Abstract Labour is the essence of Value, it creates Value, but it is not the source of Value. The source is the concrete labour which produces the Use Value in which the Value is embodied.

Just as the intensity of light is a function of the source of the photons, so the quantity of Value is a function of the source of the abstract labour that is its substance. So, the product of 1 hour's labour by a brain surgeon, is the source of more abstract labour, and therefore Value, than an hour's labour by an unskilled machine minder, just as 1 hour's sunlight, produces more photons, and therefore intensity of light than 1 hour's candlelight.

 People seem to Value the skilled labour of singers like Robbie Williams much higher than that of say a nurse, because they are prepared to pay much more for the product of the former.
How is one type of concrete labour to be compared to another? Marx seems to suggest only by comparison of their products.

It is the expression of equivalence between different sorts of commodities that alone brings into relief the specific character of value-creating labour, and this it does by actually reducing the different varieties of labour embodied in the different kinds of commodities to their common quality of human labour in the abstract.” (p 57)

So, if we excluded the Value of the cotton from the linen, and the linen from the coat, so that all we were comparing was the living labour expended in both (the value added) then, if it takes 1 hour to weave the 20 yards of linen, and 1 hour to make the coat, if 40 yards of linen exchanges for 1 coat, we know that 2 hour's of weaver's labour is equal to only 1 hour of tailor's labour.

In reality, although we think that what we are exchanging is commodities, what we are really exchanging is amounts of labour-time, just as was the case in the examples provided earlier from anthropological studies. For example, the peasant who works on the blacksmith's fields while the blacksmith shoes his horse. But, not all concrete labour is the same. Marx makes this clear in quoting Ben Franklin .

The celebrated Franklin, one of the first economists, after Wm. Petty, who saw through the nature of value, says: “Trade in general being nothing else but the exchange of labour for labour, the value of all things is ... most justly measured by labour.” (“The works of B. Franklin, &c.,” edited by Sparks. Boston, 1836, Vol. II., p. 267.) Franklin is unconscious that by estimating the value of everything in labour, he makes abstraction from any difference in the sorts of labour exchanged, and thus reduces them all to equal human labour. But although ignorant of this, yet he says it. He speaks first of “the one labour,” then of “the other labour,” and finally of “labour,” without further qualification, as the substance of the value of everything.” (Note 1 p. 57)

The illusion that we are exchanging commodities, when, in fact, we are really exchanging amounts of our labour-time, Marx calls 'commodityfetishism'.

Human Labour is not itself Value even though it creates Value. Rather like a candle is not light, but is the source of photons that are the substance of light. Labour only becomes Value through its product i.e. when it is formed in some product Use Value. How much that Value is is measured in labour-time, but its relative size, its Exchange Value, can only be expressed in terms of some other Use Value. In the same way that the light from the Sun can be expressed as so many candle power, or the power of an engine can be expressed as so many horse power, so the Exchange Value of 100 yards of linen can be expressed as so many coats. That is so even though the units of measurement may no longer bear any resemblance to their original form.

Two commodities, 20 yards of linen, 1 coat are equivalent Exchange Values because in these quantities they both contain the same amount of Abstract Labour-time. But, changes in the productivity of weaving or tailoring mean that the amount of labour-time for each is continually changing. As a consequence the Exchange Value of Linen expressed in coats is continually changing. If the labour-time required to produce a coat remains constant, but the productivity of weaving doubles then the labour-time previously required to produce 20 yards, will now produce 40 yards. So, now 40 yards will equal 1 coat.

The same is true the other way around, if the time required for producing linen stays the same, but the time required for producing coats is halved, then 20 yards of linen will now equal 2 coats. If the labour-time required to produce both linen and coats doubled then 20 yards of linen would continue to equal 1 coat, because both would still contain the same amount of labour-time. The Value of each measured in labour-time would have doubled, but their Exchange Value would remain the same. There would only be a change in their Exchange Value, if both were compared with some third commodity.

If the labour-time required for ALL commodities rises by the same proportion then their Exchange Values remain constant, although the Value of all of them will have risen. Its important to note that this is NOT the same as inflation, therefore, where all prices rise. If the labour-time required for production of all commodities rises in the same proportion, the result is not higher prices, but a reduction in the quantity of commodities that can be produced in a given time. In other words a reduction in real wealth.

The Value Form consists of this, the Relative Form of Value (20 yards of linen) is expressed in a certain quantity not of Exchange Value, but in a definite quantity of Use Value i.e. the Equivalent Form of Value (1 coat). A quantity of Exchange Value cannot be expressed as an equivalent amount of Exchange Value. It is meaningless to say £1 = £1, just as its meaningless to compare a certain amount of Use Value to the same Use Value e.g. 1 apple = 1 apple.

Such expressions of relations in general, called by Hegel reflex categories, form a very curious class. For instance, one man is king only because other men stand in the relation of subjects to him. They, on the contrary, imagine that they are subjects because he is king.” (note 1 p 63)

This relation, which as Marx says escapes bourgeois economists, unlocks the riddle of money, which we will come to later.

Importantly, the Use Value that serves as the equivalent form of value is also the materialisation of Abstract Labour-time, and at the same time the product of a specific type of concrete labour.

This concrete labour becomes, therefore, the medium for expressing abstract human labour. If on the one hand the coat ranks as nothing but the embodiment of abstract human labour, so, on the other hand, the tailoring which is actually embodied in it, counts as nothing but the form under which that abstract labour is realised. In the expression of value of the linen, the utility of the tailoring consists, not in making clothes, but in making an object, which we at once recognise to be Value, and therefore to be a congelation of labour, but of labour indistinguishable from that realised in the value of the linen. In order to act as such a mirror of value, the labour of tailoring must reflect nothing besides its own abstract quality of being human labour generally.

In tailoring, as well as in weaving, human labour power is expended. Both, therefore, possess the general property of being human labour, and may, therefore, in certain cases, such as in the production of value, have to be considered under this aspect alone. There is nothing mysterious in this. But in the expression of value there is a complete turn of the tables. For instance, how is the fact to be expressed that weaving creates the value of the linen, not by virtue of being weaving, as such, but by reason of its general property of being human labour? Simply by opposing to weaving that other particular form of concrete labour (in this instance tailoring), which produces the equivalent of the product of weaving. Just as the coat in its bodily form became a direct expression of value, so now does tailoring, a concrete form of labour, appear as the direct and palpable embodiment of human labour generally.

Hence, the second peculiarity of the equivalent form is, that concrete labour becomes the form under which its opposite, abstract human labour, manifests itself.” (p 64)

A commodity is both a Use Value and a Value. That is it has utility (for someone) and it is the product of human labour. Its Value is the amount of labour-time required for its production. Technically, however, as Marx points out, it only has Exchange Value, when this Value takes an independent form. That is when the commodity is brought into contact with, and expressed in relation to some other commodity. That is when this Value ceases being Individual and becomes social.

In every society throughout history the products of human labour are Use Values. But, it is only when the labour spent in producing such Use Values becomes expressed as a quality of that article, as its Value, that it becomes a commodity.

 At the Chicago Mercantile Exchange, the relative prices of thousands of commodities are determined minute by minute.
So far, we have only shown how one commodity's value is expressed by a certain quantity of some other, but what we need is to show how any one commodity's value is related to all other commodity's value.

So, 20 yards of linen might = 1 coat, but 2 oz. Gold, or 10 cwt. of potatoes and so on. What at first seems an accidental relation of exchange of all these commodities is now, however, uncovered. The Value of any commodity does not change because it is exchanged against another, all that changes is the units in which it is expressed – coats, gold, potatoes. The Values of commodities remain constant (provided there is no change in the labour-time required for their production), and it is these Values which determine the proportions in which they exchange – their Exchange Values – not vice versa.

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