Wednesday, 1 January 2014


Marx uses the term 'Capital' in a number of ways. He talks of Capital in a number of forms, which are specified, for instance “Productive-Capital”, “Money-Capital”, “Commodity-Capital”, each of which are specific physical forms of Capital. Each of these imply a definition of Capital itself as something more than just these specific forms of it. In this sense, Marx also talks of Capital as being “a social relation”, as well as being “self-expanding value”. In fact, both of these last two definitions are aspects of the same thing. Capital is self-expanding value, but value can only self-expand within the context of a specific social relation. When Marxists speak of “Capital” then they mean something different to its usual use in vocabulary. In fact, it means something even more specific than the more restricted use that bourgeois economists apply compared to its normal use in every day language.

The essence of “Value” is labour. Value is labour, and the measure of value is labour-time. Value can always be expanded, therefore, simply by adding or performing more labour. A primitive commune creates value by performing communal labour - hunting, fishing, making tools etc. It can always create more value by performing more labour. But, there is no means by which this value can expand without the performance of additional Labour-time. It cannot be self-expanding value.

The same is true of other forms of society. In a slave-owning society, for example, the majority of people are not slave-owners, but self-sufficient peasants. Each peasant family produces an amount of value equal to the labour-time it performs. If, it produces products that are surplus to its requirements, and decides to exchange them for other products it requires, so that these surplus products become transformed into commodities, and the value of the products becomes measured in a quantity of other products, i.e. it takes the form of an exchange value, this process does not lead to the creation of any additional value. One amount of value/labour-time is simply exchanged for an equivalent amount of value/labour-time.

This is still true for the slave-owner. As Marx sets out in the Grundrisse and in Capital slaves occupy the same position in the economy as does any other pack animal, and the same is true of a machine. That is a slave, a beast of burden and a machine can all produce surplus products, in that they can produce more products than are required for their production and maintenance, but they do not produce a value greater than is required for their production and maintenance. The owner of a slave, ox, or water mill will have to expend value for their purchase and maintenance, and that value will be transferred into the value of the products they help produce, but nothing more. The illusion is created that these things create additional value only because where they are used to produce commodities, the exchange value of those commodities is determined by the average social labour-time required for their production, and that may be higher than the individual value of commodities produced using slave labour, pack animals or machines. The difference between the individual value and the social value, therefore appears as a surplus value, but if all commodities were produced using slaves, pack animals and machines in the same way, then the difference between the individual value and social value would disappear, and the surplus value would disappear with it.

The same is true of a communist society. A communist society will produce value equal to the labour-time expended. Workers will receive tokens equal to the labour-time they have contributed, and giving them an entitlement to an equivalent proportion of the total social labour-time expended, after deductions have been made to cover administration costs etc. As Marx puts it in the Critique of the Gotha Programme,

“Here, obviously, the same principle prevails as that which regulates the exchange of commodities, as far as this is exchange of equal values. Content and form are changed, because under the altered circumstances no one can give anything except his labour, and because, on the other hand, nothing can pass to the ownership of individuals, except individual means of consumption. But as far as the distribution of the latter among the individual producers is concerned, the same principle prevails as in the exchange of commodity equivalents: a given amount of labour in one form is exchanged for an equal amount of labour in another form.”

So, again although such a society produces a surplus product – a product greater than was needed to replace the means of production and the labour-power consumed in producing the current output – no surplus value is created.

It is only in the specific conditions of Capitalism, where Capital employs wage-labour, that a surplus value is produced. It is the production of surplus value, which is the means by which Capital self-expands.

“But it is only within the process of production that the value laid out in labour-power is converted (not for the labourer but for the capitalist) from a definite, constant magnitude into a variable one, and only thus the advanced value is converted altogether into capital-value, into capital, into self-expanding value.” 

(Capital II pp 217-8)

Capital is then both a social relation and self-expanding value, and one entails the other.

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