Monday, 26 November 2018

Theories of Surplus Value, Part III, Chapter 19 - Part 22

If the value of commodities is, as Malthus argues, equal to the value of labour contained in them, plus profit, and if the workers are paid the full value of this labour, then profit can only be a surcharge levied on top of that value. In other words, if the value of labour contained in the commodity is equal to wages, then profit must be an additional amount on top. But, if that is the case, it means that, in so far as capitalists exchange commodities with each other, they equally cheat each other, so that they are unable to realise any profits from such exchanges. It's only where capitalists sell commodities to workers that they can realise any such profit, because the capitalist sells commodities to the worker above their value, whilst the worker only sells labour to the capitalist. However, what this then means is that the capitalist sells a commodity containing 10 hours of labour, to the worker, in exchange for 11 hours labour. The price of the commodity is labelled up as 11 hours, because its price is the 10 hours of labour contained in it, plus 10%, i.e. 1 hour of profit. But, then Marx says, this is the same thing as if the worker, and the worker alone, in all these exchanges, performs 11 hours of labour, but is only paid for 10. The worker here works for 11 hours, and produces a mass of commodities, but they are then paid back with the commodities they produced, during 10 hours, with the capitalist keeping all those produced in the other hour for themselves, as a surplus product. In so far as not all capitalists sell commodities to workers, their profits would be imaginary, in the case of those who sell only to other capitalists. 

“And what does it mean but that profit—as far as the working class is concerned—is made by their working for the capitalists for nothing part of the time, that therefore “the quantity of labour” does not come to the same as “the value of labour”. The other capitalists however would only be making an imaginary profit, since they would not have this expedient.” (p 33) 

However, this imaginary profit, on the part of those capitalists who do not sell commodities to workers disappears if the idea of profit as a surcharge is disposed with. If, instead, we start from the proposition not that commodities are sold at their value plus a surcharge for profit, but that they are sold at their value, and this value includes the profit, then it becomes clear that part of the value is value for which the capitalist has given no equivalent, that they have obtained labour for which they have not paid. In that case, all capitalists that employ wage workers, thereby obtain this surplus value, even when they sell their commodities at their value. 

Malthus fails to understand this concept or that profit can arise other than as a surcharge. Ricardo himself fails to analyse the source of surplus value, instead assuming its existence. Yet, its clear from Ricardo's own theory of value that profit can arise other than as simply a surcharge. But, Malthus also fails to understand these propositions of Ricardo either. So, for example, Malthus writes, 

““Allowing that the first commodities, if completed and brought into use immediately, might be the result of pure labour, and that their value would therefore be determined by the quantity of that labour; yet it is quite impossible that such commodities should be employed as capital to assist in the production of other commodities, without the capitalist being deprived of the use of his advances for a certain period, and requiring a remuneration in the shape of profits. 

In the early periods of society, on account of the comparative scarcity of these advances of labour, this remuneration would be high, and would affect the value of such commodities to a considerable degree, owing to the high rate of profits. In the more advanced stages of society, the value of capital and commodities is largely affected by profits, on account of the greatly increased quantity of fixed capital employed, and the greater length of time for which much of the circulating capital is advanced before the capitalist is repaid by the returns. In both cases, the rate at which commodities exchange with each other, is essentially affected by the varying amount of profits” (Definitions etc., ed. by Cazenove, p. 60).” (p 33) 

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