Saturday, 2 January 2016

Capital III, Chapter 21 - Part 13

The fact, as seen earlier, that with the advance of capitalist production, an increasing quantity of capital must take the form of money hoards, and these money hoards are increasingly in the hands of money capitalists does not change this. However,

“The entire transaction, as assumed, takes place between two kinds of capitalists — the money-capitalist and the industrial or merchant capitalist.” (p 353)

And because the money-capitalist drains a portion of profit in the shape of interest, this establishes a contradiction of interests between these two groups.

“If we want to call interest the price of money-capital, then it is an irrational form of price quite at variance with the conception of the price of commodities.” (p 353)

Price is the value of a commodity expressed in money, as the universal equivalent form of value. But, price is irrational here insofar as the value lent is itself a sum of money. It is irrational to say that the price of £100 is £100, and even more irrational to say that the price of £100 is £5!

“How, then, can a sum of value have a price besides its own price, besides the price expressed in its own money-form? Price, after all, is the value of a commodity (this is also true of the market-price, whose difference from value is not one of quality, but only one of quantity, referring only to the magnitude of value) as distinct from its use-value. A price which differs from value in quality is an absurd contradiction.” (p 354)

The answer, as seen, is that the commodity here is not the sum of money lent as capital, but its use value as capital. But, the price is then irrational for the second reason which is that this use value has no value, and as price is only value expressed in money, it is a contradiction to have something which has no value, expressed in money.

“This shows how absurd it is from the very first to apply here to the simple relations of exchange through the medium of money in buying and selling, as Proudhon does. The basic premise is precisely that money functions as capital and may thus be transferred as such, i.e., as potential capital, to a third person.” (p 354-5)

As stated earlier, the use value of capital, whether in the form of money or commodities, depends on the ability of that capital to self-expand. Money or commodities can be employed simply as money or commodities, or else as capital, and what enables the latter is the existence of its opposite, wage labour, which is the basis of its self-expansion.

“The contradictory social features of material wealth — its antagonism to labour as wage-labour — are expressed in capitalist property as such independently of the production process. This particular fact, set apart from the process of capitalist production itself, from which it constantly results and as whose constant result it serves as a constant prerequisite, expresses itself in that money and commodities alike are latent, potential, capital, so that they may be sold as capital, and in that they can in this form command the labour of others bestowing a claim to appropriate the labour of others, and therefore represent self-expanding values. It also becomes clearly apparent that this relationship, and not the labour offered as an equivalent on the part of the capitalist, supplies the title and the means to appropriate the labour of others.” (p 355)

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