Monday, 12 November 2018

Theories of Surplus Value, Part III, Chapter 19 - Part 8

2. Malthus’s Vulgarised View of Surplus-Value 

When a buyer buys a commodity, the assumption is that this is an exchange of equal values. Someone who buys 10 metres of calico, with a value equal to 10 hours labour, hands over £10, which is assumed to be an amount of money that also equals 10 hours of labour. There is no assumption of unequal exchange here, in relation to the exchange of commodities. 

However, when we come to look more closely at the buyers and sellers, and the commodities or money they bring to the exchange, three further possibilities arise. If we assume that the buyer is a capitalist, they buy the 10 metres of calico at its value of £10, as with any other buyer, but what about this £10 with which they buy it? They have obtained this £10 from selling commodities of their own. But, we have seen that, when they sell a commodity for £10, this includes a profit of, say, £2. This profit arises because they are selling a commodity for £10, which has only cost them £8 to produce. 

In essence, therefore, when they buy the 10 metres of calico, for £10, it has actually only cost them £8, because they buy the calico with £10, which they obtained at a cost of only £8. 

If the seller is also a capitalist, and their 10 metres of calico only cost them £8 to produce, they still obtain £10 of value, when the buyer gives them £10 for it, even if that £10 only cost the buyer £8 to obtain. As capitalists, both the buyer and seller obtain 2 hours/£2 of profit, when they sell their commodities. In effect, in these exchanges between capitalists, it is as though they both exchange these commodities at a price of £8, that they only have a value of 8 hours, which is what it has cost them. This is the same as previously described in relation to a society where there are only slaves and slave owners, and the same would apply in a society where all production was undertaken automatically by machines. 

Of course, if the only consumers, in a capitalist economy, were capitalists, then this would cancel itself out, as previously seen, in connection to the Mercantilists. In other words, if capitalist A sells a commodity with a value of £8, to capitalist B, for £10, and B then sells a commodity to A for £10, that only has a value of £8, no profit arises for either, because they rob each other to the same extent. They could just as easily have exchanged at £8. All that exchanging at a nominal price of £10 represents is an inflation of those nominal prices. The same thing can be seen with the delusion of inflated asset prices, resulting from speculation. 

The thing is, of course, that, in a capitalist economy, capitalists are not the only consumers. 

The second case considered by Marx, then, is that the buyer is not a capitalist, but an independent producer. In other words, a peasant producer, or artisan, who employs their own labour-power. In that case, this producer also buys the 10 metres of calico for £10. They obtained this £10 from selling their own commodity, let's say 10 kilos of grain, which has a value equal to 10 hours of labour. But, unlike the capitalist, all of this £10 value is what it has cost the peasant. They may have spent £6 for seeds, and other means of production, equal to 6 hours of labour, and then expended 4 hours of their own labour-time, making up the full value of the grain. 

In this case, they exchange equivalents. They obtain calico with a value of £10/10 hours of labour, and they give for it £10, which cost them 10 hours of labour to obtain, through the production of grain. 

That the value of their labour-power, reproduced in this grain is only equal to 2 hours/£2 does not change the matter. In other words, to reproduce their labour-power, only requires 2 hours labour, or 2 kilos of grain. The other 2 hours of labour they perform is surplus labour, embodied in 2 kilos of grain. But, unlike the capitalist, this surplus product of 2 kilos has not come to them gratis. It is labour they have themselves had to perform. 

The third case is where the buyer is a wage worker. They too buy the 10 metres of calico with £10, and so this is an exchange of equal amounts of value. They obtain their £10, however, from wages paid to them. The question here then is what does this £10 of wages represent? In so far as it buys £10 of commodities, representing 10 hours of labour, it represents this same 10 hours of labour, but the question is how much labour does the worker have to sell in order to obtain this £10. 

If the answer is only 10 then no surplus value or profit would be possible, because the worker would be paid £10 in wages, having only themselves created £10 of new value. If the worker buys the £10 of wages by providing 12 hours of labour, however, then the capitalist who buys this labour thereby obtains 12 hours of labour for just 10 hours of labour. Put another way, the worker buys the 10 metres of calico for £10, which is its value. In order to obtain this £10, to buy the calico, the wage worker has to work for 12 hours. Where, for the capitalist, 8 hours of labour bought 10 hours of labour, for the wage worker, 12 hours of labour buys only 10 hours of labour. Only in the case of the independent producer does 10 hours of labour buy 10 hours of labour. 

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