Monday, 17 December 2018

Theories of Surplus Value, Part III, Chapter 19 - Part 43

15. Malthus’s Principles Expounded in the Anonymous “Outlines of Political Economy” 

Marx quotes from the Malthusian, John Cazenove's work, Outlines of Political Economy; being a Plain and Short View of the Laws relating to the Production, Distribution, and Consumption of Wealth etc., London, 1832, on why they were so opposed to the Smithian/Ricardian labour theory of value. 

““That labour is the sole source of wealth seems to be a doctrine as dangerous as it is false, as it unhappily affords a handle to those who would represent all property as belonging to the working classes, and the share which is received by others as a robbery or fraud upon them” ([John Cazenove, Outlines of Political Economy, London, 1832, ] p. 22, note).” (p 63) 

Cazenove confuses the value of commodities with the utilisation of commodities, and money and capital, but, in doing so, in the following he correctly identifies the origin of surplus value

““The value of capital, the quantity of labour which it is worth or will command, is […] always greater than that which it has cost, and the difference constitutes the profit or remuneration to its owner” (op. cit., p. 32).” (p 64) 

In other words, commodities or money of a certain value can only ever exchange for other commodities of the same value. It is the fact that these commodities or money are used as capital that enables it to produce surplus value, because it exchanges for the commodity labour-power, at this value, but the seller of the labour-power must then undertake labour that produces a greater value, a surplus value

“The following, too, which is taken from Malthus, is correct as an explanation of why profit is to be reckoned as part of the production costs of capitalist production: 

“… profit upon the capital employed” [“unless this profit were obtained, there would be no adequate motive to produce the commodity”] “is an essential condition of the supply, and, as such, constitutes a component part of the costs of production” (loc. cit., p. 33).” (p 64) 

And, as Marx demonstrated, in Capital, for society, the profit, or surplus value is a cost of production, because the labour it entails had to be performed by someone. It is only that it is not a cost born by the capitalist. Cazenove combined the notion that surplus value arises as a result of the relation between capital and wage labour with the idea that having produced the surplus value, it is only realised in circulation. 

““… a man’s profit does not depend upon his command of the produce of other men’s labour, but upon his command of Labour itself.” (Here the correct distinction is made between the exchange of one commodity for another and the exchange of the commodity as capital for labour.) “If”(when the value of money falls) “he can sell his goods at a higher price, while his workmen’s wages remain unaltered, he is clearly benefited by the rise, whether other goods rise or not. A smaller proportion of what he produces is sufficient to put that labour into motion, and a larger proportion consequently remains for himself “ (op. cit, , pp. 49-50).” (p 64) 

The same thing applies, Marx says, where new machinery is introduced by one firm, which reduces the individual value of its output, but where the firm can still sell at the old market value, thereby obtaining a surplus profit. 

“It is true that when this happens, the worker does not directly work a shorter period for himself and a longer one for the capitalist, but in the reproduction process, “a smaller proportion of what he produces is sufficient to put that labour into motion”. In actual fact, the worker therefore exchanges a greater part of his immediate labour than previously for his own realised labour. For example, he continues to receive what he received previously, £10. But this £10, although it represents the same amount of labour to society, is no longer the product of the same amount of labour-time as previously, but may represent one hour less. So that, in fact, the worker works longer for the capitalist and a shorter period for himself. It is as if he received only £8, which, however, represented the same mass of use-values as a result of the increased productivity of his labour.” (p 64) 

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