Thursday 9 August 2018

Paul Mason's Postcapitalism - A Detailed Critique - Chapter 6(2)

The Value of Labour


Paul is then confronted by that very same contradiction that faced Adam Smith, as a result of failing to distinguish between labour as the essence and measure of value, and labour-power, the use value, sold as a commodity by wage labour. So he says, 

“But what determines the value of labour? Consistent with everything else, the answer is: other people's labour – the average amount of labour it takes to present each worker at the factory gate ready for work.” (p 152) 

In other words, Adam Smith's definition of the natural price of labour. However, as Marx sets out in Capital I, and in Theories of Surplus Value, this idea, put forward by Adam Smith, is both irrational, and leads to impossible conclusions. Firstly, Marx points out that enquiring as to the value of labour is the same as asking how long is length. Labour is not a thing, but an activity, the activity of creating value. Labour is value, the activity of labour, is the activity of creating value, so asking what is the value of labour is the same as asking what is the value of value!? 

Secondly, let's suppose that bringing the worker to the factory gate ready for a day's work, requires 10 hours of labour. In other words, it requires 10 hours of labour to produce the wage goods required to reproduce the worker for a day. So, a day's labour is equal to 10 hours labour. If the worker sells their labour at this value, therefore, they will provide to the capital 10 hours of labour, not a minute more nor less, so that, in conformance with the law of value, and commodity exchange, there is an exchange of equal value. But, then, as Marx points out, no surplus value is ever possible, as was also seen in relation to the Bangladeshi T-shirt worker. Otherwise, as Marx says, you are left making the nonsensical argument that 10 hours labour is equal to 12 hours labour, for example. 

It was precisely because Smith recognised the incompatibility of the idea that 10 hours labour in the form of commodities (wage goods) could command 12 hours labour from the wage labourer, that he concluded that as soon as capital comes into existence, the labour theory of value ceases to operate, because this labour does not exchange at its value. In reality, Smith had both failed to distinguish between labour and labour-power, but had also failed to distinguish between an exchange of commodity with commodity, and an exchange of capital with commodity. The fact that the commodities in the possession of the capitalist, as variable-capital, act as capital, self-expanding value, is precisely what enables them to command a greater quantity of labour than they themselves represent. It stems from the historically specific relation of capital to wage labour. 

Paul ends up in precisely that confusion, as with Adam Smith, just a few lines further on, in attempting to explain where profit comes from. 

“My boss can pay me the true value of the eight hours work I just did. But that true value might be just four hours.” (p 152) 

Which means that, like Smith, Paul is left in an argument that has collapsed into a reductio ad absurdum where the value of 8 hours labour is equal to 4 hours labour!!! That's like saying 100 metres is equal to 50 metres. 

The answer to this conundrum that Paul and Adam Smith find themselves in was provided by Marx. The wage worker does not sell 8 hours labour to the employer, as Paul thinks. If they did, they would have to get 8 hours labour back, in wages, as demanded by the law of value, and of commodity exchange. What the worker sells to the employer is a commodity, but that commodity is labour-power itself. It is that commodity, which may only have a value of 4 hours, i.e. require 4 hours to reproduce the wage goods required for the worker's own reproduction. The worker sells a commodity – labour-power – with a value of 4 hours, and gets an equal amount of value in exchange, as wages

What the employer has bought is a commodity, labour-power, which they now have the right to use, as with any other commodity they buy. The worker sells that commodity to them for a given duration, say 8 hours, and during that time the worker creates 8 hours of new value, for the employer. The employer thereby has obtained 4 hours of surplus value, for which they have given nothing in exchange. But, this is not the result of any unequal exchange. The worker got the value of the commodity they sold – labour-power – in the form of an equal value of wages. The surplus value arises not in this exchange, but in the process of production, precisely because the worker creates a new value greater than this value of their labour-power, and this new value is directly the property of the capitalist, who bought the labour-power for the 8 hour period.  Its nonsense therefore, to say that the 8 hours of new value actually created by 8 hours of labour really has a value of only 4 hours.

Paul comes close to that solution, when he returns to his practical example, and refers to what is being bought being “her ability to work”, but he drops it again and like Smith, falls back into a Physiocratic argument based upon physical inputs as against physical outputs. And, again trying to reconcile the contradiction whereby 60 hours of labour is equal to 30 hours of labour, he essentially falls back into the kind of “Force Theory” put forward by Duhring, and exposed by Marx and Engels. 

The first peasant direct producers who became wage workers, under the putting out system, did not do so because they were physically coerced into doing so. They were coerced rather by force of economic circumstance. For various reasons, such individuals found themselves in debt, and unable to buy the materials required to continue their own independent production. So, usually, the same merchants who sold them materials, and bought their finished products began to supply them with the materials, and to pay them a wage for the labour they added to it. In return, the merchant made an additional profit, therefore, from their labour, because what was paid to them in wages, was less than the value of the added labour. This capitalist production was able to produce commodities more cheaply than could the other individual peasant producers, so that more and more of them found it impossible to compete, and so were themselves forced to become wage workers. Given that most of these workers were also peasants living on the land, as capitalist farming expanded, they were also unable to compete in that sphere too, and as capitalist farming led to land enclosures, they were forced from the land, and into the towns. 

Its effectively not physical force that makes workers provide large amounts of unpaid labour time, but economic circumstance. For example, Marx sets out the situation of labourers, in earlier times, in relation to the Statute of Labourers, which attempted to bring into law a Minimum Working Day. It reflected the fact that labourers were in short supply and able to both live off the land, and obtain relatively high wages. Marx also cites William Petty and others who related that initially even in the latter part of the 17th century, capitalists could make no profit because they couldn't get workers to work for more than a few hours per week, during which time they obtained the money wages they required to cover their money expenses over what they provided directly for themselves. 

In the early 19th century, the excess working times etc. were a consequence of a massive oversupply of factory labour. As soon as that excess supply was used up the ability to continue on that basis ended too. Its why the capitalists had to agree amongst themselves to the creation of some kind of level playing field, and regulation, so as to husband their most precious resource, enforced by their state. Its why they turned towards the production of relative surplus value, via productivity raising innovations. 

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