Thursday, 27 December 2018

Theories of Surplus Value, Part III, Chapter 20 - Part 6

Marx sets out here basically the same historical process he discusses in Capital III, in relation to the transformation of exchange-values into prices of production. When production is undertaken by self-sufficient producers with their own means of production, they are not compelled to sell their products on the market, which is why the commodity, and exchange-value does not take on its fully mature form. The costs for the direct producer consist of the tools and materials he uses, plus his own immediate labour. The commodity he produces, therefore, has a value equal to the labour contained in the tools and materials (materialised labour) plus his own immediate labour, and it is this value which is then compared with that of other commodities in determining its exchange value. Because the immediate labour expended on its production may be greater than what is required for the labourer's own reproduction, the value of the commodity already contains a surplus value, just as his product constitutes a surplus product, but it is not a surplus that has come to him freely, it is a surplus created by his own labour

The direct producer, therefore, is only interested in exchanging this commodity so as to obtain an equal amount of value in a different form, a different set of use values to meet their needs. But, in doing so, they automatically transform what was their own surplus labour and surplus product into a surplus product, or a surplus value, of some other form, including money, which they may use to pay rent and taxes etc. But, for the capitalist, the situation is different. 

The cost to the capitalist consists in the capital he advances—in the sum of values he expends on production—not in labour, which he does not perform, and which only costs him what he pays for it.” (p 74-5) 

The capitalist may advance the same amount of value as the direct producer, for tools and materials, but they only advance as wages, to the worker, an amount of value equal to their necessary labour, i.e. to the labour required to reproduce their labour-power. The direct producer may only have needed to work for four hours to reproduce their labour-power, but worked for eight hours. The additional four hours was surplus labour, embodied in a surplus product, which they took to market. With the money obtained from this surplus product, they could pay rents and taxes, so that their surplus value was appropriated by the landlord and the state. 

It's not as though there was some golden age for direct producers, therefore, prior to them becoming wage labourers. They performed surplus labour that was incorporated in a surplus product that was either directly appropriated by the landlord and state (Labour Rent and Rent in Kind, taxes and tithes) or indirectly (Money Rent, and taxes). This is one reason that, today, in many industrialising economies, peasants are keen to leave their villages, to become wage workers, in the town, where wages provide them with a higher standard of living. 

As Lenin describes, in “The Development of Capitalism in Russia”, the fact that peasant producers hand over surplus production or surplus value to landlords, or the state, does not mean that this affects all such producers equally. Some are able to retain a portion of their surplus production, which can then be used to acquire additional or better means of production, which raises their productivity further. They may also be able to employ day labourers themselves. By these means, a differentiation of the peasantry arises, with some becoming capitalist producers, whilst, at the other end, they become wage workers. 

The capitalist producer then only has costs of what they pay for the constant capital, and what they pay in wages, but the surplus product, and surplus value comes to them directly, for free. Moreover, where the capitalist producer differs from the direct producer is that the latter only produces so as to consume. What they sell on the market only covers what they need to buy, or to pay in rents and taxes. But, the capitalist only produces in order to obtain surplus value, which, in turn, they seek only to expand their production, so as to produce even more surplus value. What guides their decision, therefore, is what produces for them the greatest profit, in relation to the capital they advance. And, it is this which means that competition drives capital into the high profit areas, and thereby raises supply, of those commodities, reducing the market prices for them below their exchange-value, until they reach the price of production. 

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