In Part 2,
it was indicated how money acts to obscure what are relations between
human beings, turning them instead into relations between things. In
the first instance, the workers gave the employers 1 billion hours of
their labour-time, by working for five days, 200 million hours per
day. In return, the employers have given the workers commodities
with a value of 800 million hours of labour-time. This seems to be
an unequal exchange, and viewed in this way it is. The employers
have obtained 200 million hours of labour-time for which they have
paid nothing. It is represented by a surplus product, which
constitutes 20% of the total product.
However,
viewed purely in terms of the laws of commodity exchange, it is not
unequal. The workers sold to the employers a commodity,
labour-power, whose value is equal to 800 million hours of
labour-time, i.e. that is how much labour-time is required to produce
it. In exchange for that commodity they were given 800 million hours
of value in commodities. So equal values were exchanged.
The reason
the workers provide the additional 200 hours of labour-time for free,
is because they have no choice. The workers, to work, have to have
factories to work in, machines to work with and materials to process.
They own none of those things. They are all owned by the employers
as are the other things the workers require, the food to eat, the
property to live in and so on.
In order to
obtain any of the latter, the workers must work, but to work they
must be allowed to use the means of production in the hands of the
employers, and so the employers say, “We will allow you to use
our means of production on condition that you work for free for a
part of the day.”
The real issue facing Greece, therefore, should not be whether there
are enough Euro notes and coins in existence to make payments, but
whether, in the relations described above, there is adequate capital.
That is the situation described above can continue so long as, of the
1 billion hours of labour expended by workers, only 800 million hours
are required for their reproduction. That can be seen quite easily
again in the example of the kind of situation that the Physiocrats
described of the agricultural worker.
Suppose the agricultural worker produces the quantity of food they
require for their own subsistence in 4 days, as above. They work for
5 days, as above, so that a surplus product/value equal to 1 day
(20%) is produced. However, suppose there is a crop failure. The
workers continue to work for 5 days, as before, and so, as before,
create 5 days of new value. But, the workers still require the same
quantity of food as they did previously for their subsistence. As
Marx makes clear their subsistence needs are a function of use value
not value. Suppose, now then that after the crop failure, it takes 6
days rather than 4 to produce the food they require.
In that case, although they continue to produce 5 days of new value,
the value of their labour-power has risen to 6 days, because that is
what is now required to reproduce it. Instead of producing a surplus value, therefore, they produce a loss of 1 day. In order for the
worker's labour-power to be reproduced out of current production, not
only would the capitalist have to give up their surplus value, but
they would have to make up the deficit out of their capital. This
can be seen in those instances in poor countries where such crop
failures do occur, where the seed that should have replaced that used
in production, is instead consumed, thereby leading to a contraction
of capital and output.
As this
example shows, money itself is an actual irrelevance. It is merely
an equivalent form of value, acting as nothing more than a physical
visible representation and measure of these different components of
value. Whether the means of production and labour-power consumed in
the production process have or have not acted as capital, i.e.
whether they have resulted in the production of a surplus value, has
absolutely nothing to do with money, whether that money takes the
form of a money commodity, such as gold or silver, or takes the form
of money tokens, such as Euros, or the form of credit money.
It comes
down only to the question of whether the new value created by labour
is greater than the value of the labour-power that created it. To
allow a money fetish to get in the way of this understanding, is as
Marx says, ridiculous.
As Marx
describes, in 1847, a severe crisis occurred because the 1844 Bank
Act limited the amount of Bank of England banknotes put into
circulation by the amount of gold reserves in the country. So, at
the very moment the country needed additional liquidity put into
circulation, the Bank Act curtailed it, creating a credit crunch,
from which followed a 37% economic contraction.
As Marx put
it, the bankers, in order to defend a nominal value of paper notes,
and the nominal wealth of the money lenders, created the destruction
of millions of pounds of real capital and real wealth. To destroy
millions of Euros of capital in Greece, for the sole purpose of
protecting the nominal value of paper Euros, makes no more sense, and
yet that is what the policy of austerity has done, in the last five
years, as economic activity was shrunk by 25%.
The question
for Greece comes down to a question of capital not money. In other
words, are the means of production and labour-power acting as
capital? But, in that case, why is so much being made of the
shortage of money? Why are people queuing at cash machines to take
out notes?
I will
examine that in Part 4
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