Capital III, Chapter 48 - Part 8

In Capital I, it was demonstrated that the concept of a “price of labour” is itself irrational. If a worker performs 10 hours of labour, and is paid £10, this appears that the price of labour is £1 per hour. But, if that were the case, profit would be impossible. If the worker performs 10 hours of labour, they create 10 hours of new value, a value of £10, if the price of labour is £1 per hour. But, if they are then paid £10 for those 10 hours of labour, this leaves nothing over for profit. What, in fact, the worker receives in £10 of wages, is not the equivalent value of 10 hours of labour, but something less, say the equivalent of 5 hours of labour. What they receive is an equivalent amount of value/labour-time as is required to produce the commodities required to reproduce their labour-power.

In that case, the value produced by an hour of labour is equal to £2. In working for 10 hours, the worker produces a value of £20, out of which £10 is returned to them as wages. Their wages are not the price of labour, but the price of labour-power, the commodity sold by the worker. It is not the value of this labour-power that creates or adds new value, the value of labour-power is not transferred to the value of the commodity, as occurs with the constant capital. It is the activity of labour, which creates new value, and it is only out of this new value, created by the activity of labour, that the value of the labour-power can be reproduced; it is only out of the fund of physical products, created by that activity, that the means of consumption, required for the physical reproduction of that labour-power can be drawn.

“We have seen that the capitalist process of production is a historically determined form of the social process of production in general. The latter is as much a production process of material conditions of human life as a process taking place under specific historical and economic production relations, producing and reproducing these production relations themselves, and thereby also the bearers of this process, their material conditions of existence and their mutual relations, i.e., their particular socio-economic form. For the aggregate of these relations, in which the agents of this production stand with respect to Nature and to one another, and in which they produce, is precisely society, considered from the standpoint of its economic structure.” (p 818)

In other words, the production of value takes place necessarily as simultaneously a production and reproduction of use values. The production of value, provides on the one hand the money form of that value, as revenues in the hands of workers, capitalists, landlords that are used by them to purchase the commodities required for their own reproduction. On the other, it produces the actual commodities, use values, consumed as part of that reproduction.

The value of commodities, used as means of production, in the production process is transferred, and thereby reproduced in the value of the society's commodity-capital. At the same time, a portion of the society's total output takes the physical form of the use values required to reproduce those same means of production. 

Not only is the value of constant capital, and variable capital reproduced, but the use values required for its physical replacement are also produced. Not only is a surplus value produced, but physical products for individual consumption by capitalists, landlords and other non-producers are created, as well as means of production to be used to expand production, as well as means of consumption required by an expanded workforce.

The production and reproduction of value, thereby, goes hand in hand with the production and reproduction of the physical products required to reproduce and expand production on the same basis.

In so doing, the particular social relations that arise on the back of capitalist property and productive relations are thereby reproduced and reinforced. The workers, obtain only the value of their labour-power, even if this value is manifest in an increasing quantity and range of use values, i.e. a steadily rising standard of living.

At the same time, the capitalist class obtain a rising mass of surplus value. As social productivity rises, this not only means that workers living standards rise, as they obtain a rising mass of use values, for the same or even a falling mass of value, but by the same token, this rise in social productivity means that a given mass of surplus value is also manifest in a rising quantity and range of use values. The capitalists too, not only expand their own living standards to unprecedented levels of affluence, but a greater proportion of the surplus value remains left over for accumulation, and as the value of means of production also falls, so this expanding mass of surplus value accumulates an even greater mass and range of means of production.

As Marx describes in the Grundrisse, therefore, even as the workers become more affluent, so they become also poorer. Their affluence rises because the rise in productivity increases real wages/living standards. They become poorer because capital acquires, by the same process, an increasing proportion of the means of production, which are thereby removed further from the ownership of the producers.

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