Theories of Surplus Value, Part I, Chapter 3 - Part 12

Having pointed out the difference between his view and the apologist view, Smith says,

““In this state of things the whole produce of labour does not always belong to the labourer. He must in most cases share it with the owner of the stock which employs him. Neither is the quantity of labour commonly employed in acquiring or producing any commodity, the only circumstance which can regulate the quantity which it ought commonly to purchase, command or exchange for. An additional quantity, it is evident, must be due for the profits of the stock which advanced the wages and furnished the materials of that labour” ([ibid., pp. 54–55], [Garnier] l.c., p. 99).” (p 81)

To which Marx responds,

“This is quite correct. Given capitalist production, materialised Labour—in the form of money or commodity—always purchases, besides the quantity of labour which it itself contains, an “additional quantity” of living labour “for the profits of the stock”; which however in other words means nothing but that it appropriates for nothing, appropriates without paying for it, a part of the living labour.” (p 81)

Smith is ahead of Ricardo, in that he recognises that it is with capitalism that a changed relation exists, in that it is no longer a question of individual commodity producers exchanging the product of their labour. But, Marx says, Smith is behind Ricardo, who continues to argue that commodities exchange at values determined by the labour-time required for their production. Smith is behind Ricardo in this respect, because, although his own analysis had refuted the idea, he cannot get away from the idea that with the advent of wage labour and capital, commodities do not exchange at their value, because labour no longer obtains an equivalent for the value it creates, or, put another way, commodities now command a greater quantity of labour than is required for their own production. This dilemma confronts Smith because he does not distinguish between labour as the essence of value, and labour-power, the commodity sold by workers.

Smith has, therefore, shown that the worker produces one quantity of new value, but receives a smaller quantity of value in the form of wages. The difference, the surplus value, in this exchange between capital and wage labour, then takes the form of profit. Its justification, for Smith, is that capital supplies, and thereby risks the capital supplied, in the forms of means of production, and the means of consumption, supplied to workers as wages.

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