Monday, 20 May 2019

Say Bollocks To Brexit

The European parliament elections on Thursday will be a proxy for the second referendum that the Tories dare not call, and that Labour's leadership has steadfastly refused to campaign for. In any such actual referendum, socialists would obviously vote to Remain, to maintain the international unity and solidarity of the working-class, free from the constraints and restrictions that national borders place upon them. It is only rational, therefore, in these elections, to vote for those parties that most clearly argue for stopping Brexit, and have the best chance of winning, in each area. On the basis of the analysis conducted by Remain United that means voting Liberal throughout England, SNP in Scotland, and Plaid in Wales. It is necessary to mobilise the greatest possible vote for these parties, as the clearest vote against Brexit, and thereby to defeat the reactionary nationalism of Farage's Brexit company, and the Tories. 

It is a tragedy that, in these elections, it is not possible to rally behind Labour as the vanguard of that fight against reactionary nationalism, but the reality is that, although 90% of Labour Party members, and about 75% of Labour voters, oppose Brexit, the party leadership has adopted the same kind of reactionary nationalist position as the Tories. There is barely a hair's breadth of difference between the policy that Theresa May has put forward in her Withdrawal Agreement, and the “Jobs First Brexit” fantasy that Labour has put forward, as its preferred Brexit option. That is why it was possible for Labour to sit in talks with our class enemy for six weeks trying to arrive at a form of words that would allow them to sell it to both Tory and Labour MP's, and activists. As Barry Gardiner honestly described it, it amounted to Labour “bailing-out the Tory government”. Labour's leadership has disgraced itself, by its actions, in similar ways to that of Ramsay MacDonald in the 1930's. 

Its understandable that Labour members and supporters, especially those that had great enthusiasm following the election of Corbyn as party leader, should try to see the glass as half full rather than half empty, to try to put a positive spin on the disastrous course that Corbyn and the party leadership have adopted over the last three years. Its understandable that they might want to allow themselves to be persuaded that it was a clever strategy of “constructive ambiguity”, which is just another term for Blair-right triangulation. But, the fact is that what really lay behind that strategy was Corbyn's own history of supporting an ideology of economic nationalism that flows from the ideas of Stalinism, of the theory of building Socialism In One Country, that also lay behind the ideas put forward by the Stalinists and their fellow travellers in the Alternative Economic Strategy, developed in the 1970's and 1980's. What lies behind the disastrous strategy adopted by the party leadership, over the last three years, is the influence behind Corbyn of those same Stalinists. 

That is made worse by the fact that, the so called far left, outside the Communist Party, itself collapsed into the same kind of economic nationalism in the 1970's. They combined it with a reactionary Sismondism that was manifest in designations of being “Anti-Capitalist”, and “Anti-Imperialist” rather than being pro-socialist. In opposing capitalism and imperialism, it forgot all about the idea that these things can be opposed from both a progressive and reactionary perspective, and settled instead for simply aligning with any forces, no matter how reactionary, how anti-working class they might be, so long as they identified themselves as being anti-capitalist, or anti-imperialist. They concentrated on tearing things down rather than building anything positive from them. 

As Marx says about this form of petty-bourgeois socialism, in the Communist Manifesto, it aims at 

“... cramping the modern means of production and of exchange within the framework of the old property relations that have been, and were bound to be, exploded by those means. In either case, it is both reactionary and Utopian.” 

That reactionary trend within the Left, and particularly far left, in the 1970's, saw it line up with reactionaries such as Enoch Powell and the National Front, to push a reactionary Little Englander opposition to EEC membership. It saw at least sections of it line up, in support of the Alternative Economic Strategy, which demanded economic nationalist policies that put the blame for the failure of British capitalism on to foreigners, by backing reactionary nationalist demands for things such as import controls, and immigration controls. Alongside that it saw sections of that Left line up with assorted reactionary forces across the globe, be it Hamas in Palestine, Hezbollah in Lebanon, the Khomeiniites in Iran, or Provisional IRA in Ireland, simply on the basis of their professed “anti-imperialism”. 

In the 1980's, many people on the Left believed that the self-styled Revolutionary Communist Party was actually a secret service created group of agent provocateurs, such were its untethered in theory, and unhinged in practice, politics and behaviour. It defended the murder of innocent civilians, including children, by the Provos, for example, in the Warrington bombings. The RCP over the years has gone through a number of metamorphoses, via “Living Marxism”, to its current manifestations as the Koch Brothers funded, Spiked Online, and the Institute of Ideas. The lazy, and decadent British bourgeois media repeatedly invites the representatives of these organisations, such as Claire Fox, Brendan O'Neill, and Ella Whelan on to TV and radio to spout their ridiculous views, despite the fact that they actually represent nothing and no one. 

It is no surprise that the self proclaimed Leftist, Claire Fox, therefore, has found herself at the top of Farage's Brexit company slate for elections to the European Parliament. Yet, Fox to this day, refuses to condemn the Warrington bombings that killed innocent civilians, including three year old Johnathan Ball, and twelve year old Tim Parry, and which she and the RCP justified, at the time the bombings occurred. But, the lazy and decadent Tory media that invite these people on to their programmes, day after day, repeatedly fail to question them about their support for such actions. That we have these elements lining up with Farage, along with Stalinists such as Galloway is no surprise, because it flows from their putrid nationalist politics. It is the same politics that allowed Oswald Moseley to move seemlessly from the economic nationalism of the Mosely Memorandum, backed by Nye Bevan, to his establishment of the New Party, on the way to the British Union of Fascists. 

It is necessary for all socialists, and progressive social-democrats to draw a line in the sand, demarcating ourselves from these reactionary nationalist forces that have combined once more in an unholy red-brown alliance on the question of Brexit. Its necessary to mobilise the greatest possible vote for the anti-Brexit parties on May 23rd, and to mobilise against the forces of reactionary nationalism. 

Of course, it sticks in the craw to vote Liberal, or SNP or Plaid. This is still the same Liberal Party that was part of the Liberal-Tory coalition of 2010-2015 that implemented the crazy policy of austerity. But, remember that Labour's economic plans, under Alistair Darling, were not that much different in 2010, and remember that, up and down the country Blair-right Labour Councillors implemented those austerity measures at local level, rather than mobilising any kind of mass campaign against them. These are the same Blair-rights that followed on from Kinnock's Labour party of the 1980's, which undermined the Miners Strike, which attacked Labour Councils in Liverpool, Lambeth and elsewhere that actually did try to oppose the Tory cuts proposed by Thatcher. Its not that we consider Labour to have a great record itself, but the fact that it is the Workers Party, the party that workers look to, that comprise the majority of its membership, and that they are intimately tied to via the trades unions that leads us to give critical support to it, as Marxists. 

Moreover, if the Brexit agenda of Corbyn were to be implemented the reality is, despite all of the fantasies of the Lexiters, it would mean that the Labour government itself would have to implement a series of attacks on workers. It would mean that capital would fly from the country, causing unemployment to rise, and tax revenues to drop sharply; it would mean the Pound would fall sharply causing inflation to rise, thereby slashing workers real wages; if a Corbyn government responded to such a situation with the same kinds of policies of economic nationalism that Trump is applying, and which are described in documents such as the Alternative Economic Strategy, it would mean again rising prices, as tariffs were implemented, and so on. 

Its not surprising that seeing its support collapse, the Corbyn leadership is trying yet again to use the tactic of “constructive ambiguity”. Corbyn's appearance on the Andrew Marr show, on Sunday led to a flurry of speculation that Corbyn had committed more firmly to holding another referendum. But, the truth is he didn't. There is nothing clear in anything that Corbyn says; it is all hedged around by duplicity. There is no commitment to a second referendum under all circumstances; there is still a commitment to trying to arrive at some kind of Brexit fudge; there is no commitment to actually opposing Brexit should any further referendum be held. What is more, in his interview, Corbyn again made clear that he is committed to ending free movement. As someone said recently, following Brexit, a can of baked beans will have a greater right to free movement than will workers! 

For centuries, it was only the rich, the landed aristocracy and their lackeys that had a right of free movement. Gradually, that right became available to freemen, whilst serfs remained tied to the land and the possessions of their masters. Even as late as the 19th century, in England, the law allowed any vagrant to be branded with an “S” on their forehead and turned into a slave. It took a valiant struggle of socialists and liberals to win the right of free movement, and to end the imprisonment of people in the narrow confines of their towns and villages. Without it, tens of thousands more Irish people would have died in the famines. In Britain too, workers set up Emigration Societies, so as to escape poor wages, and unemployment, in Britain, to move to the open space of America. Now, we find reactionaries again trying to deprive workers of that basic human right to free movement. 

On Thursday, we need to mobilise the greatest possible vote to oppose Brexit, by voting Liberal in England, SNP in Scotland, and Plaid in Wales. But, that is not enough. We are being forced to channel our opposition to Brexit by voting for these parties, because the Labour leadership has given us no real alternative. Having voted to stop Brexit in the clearest terms, it is then necessary to turn our focus on to the Labour leadership itself. It is not up to the job, and is standing in our way. It is an obstacle to progress. It must be swept aside. But, the failure to push through democratic reforms over the last three years means that we are hamstrung. We still have old right-wing Labour MP's like John Mann, Kate Hoey and so on, as well as Blair-right MP's, and soft left MP's. They are supplemented by a similar layer of councillors, at local level. In addition, the party apparatus has been filled with a layer of Stalinoid apparatchiks. We need to push through a thorough democratisation and cleansing of the party. Not only do we need to deselect most MP's, but we also need to introduce far more democratic control and accountability of the party apparatus itself, including ending the right of the party leader to appoint a series of influential special advisers. 

We need a recall party conference for the Summer to introduce a range of such democratic measures, and begin the process of deselections so that we can create a truly mass, democratic fighting organisation of the working-class, capable of taking the fight to the Tories and reactionaries. We need to change the party's policy on Brexit to demand a revocation of Article 50 and end to Brexit. We should begin to develop a European strategy with other European socialists for a struggle across Europe against right-wing populism on a radical, progressive social-democratic agenda, for industrial democracy, an end to austerity, and programme of infrastructure investment across the continent. We should speed up the process of European integration via the convocation of a series of Constituent Assemblies to draw up a new European Constitution. We should commit to building a United States of Europe, and for a Workers Government, on the way to building a United Socialist States of Europe. 
But, that all starts on Thursday by voting in the greatest numbers to stop Brexit.

Say Bollocks To Brexit. 

Theories of Surplus Value, Part III, Chapter 20 - Part 150

So, technological development, which brings about a rise in productivity, cheapens wage goods, and, thereby, reduces the value of labour-power. Setting aside any other effects, this raises the rate of surplus value, and thereby increases the mass of surplus value, and rate of profit

Secondly, however, the rate of profit is determined by the ratio of variable capital to the total capital, by v/c+v. The total amount of surplus-value, where its rate is given, depends of course only on the size of the variable capital, which, on the assumption made, is determined by, or simply expresses, the number of working-days worked simultaneously, that is, the total amount of labour-time employed. But the rate of profit depends on the ratio of this absolute magnitude of surplus-value, which is determined by the variable capital, to the total capital, that is, on the ratio between variable capital and total capital, on v/c+v.” (p 232) 

If the rate of surplus value is given, the mass of surplus value depends on the mass of labour employed, or “the number of working-days worked simultaneously.” (p 232). If the mass of labour is given, then any variation in v/(c+v) must be due to a change in c. Consequently, if s/v is constant and v is constant, the mass of surplus value remains constant, whilst the rate of profit, s/C, changes, as a result of changes in c. Because c comprises only a part of C, the rate of profit will, thereby, change with every change in C, but not by the same proportion as the change in c

If the rate of surplus value is 20%, and v = £1,000, surplus value will be £200. If c is also £1,000, so that C (c + v) = £2,000, v/(c + v) = 50%. So, the rate of profit is 50% of 20% = 10%, i.e. 10% of £2,000 = £200. If c rises by 100%, it's clear that the rate of profit does not fall by an equivalent amount, because c comprises only part of C. So, if c rises to £2,000 it now comprises ⅔ of C, and v comprises ⅓. So, now, the rate of profit, represented by s is £200, and 33.3% of 20% = 6.66%. In other words, surplus value is 6.66% of £3,000. 

“How the growth or decline in the constant capital affects the ratio v/c+v depends evidently on the proportion in which c and v originally constitute parts of the whole capital C (consisting of c+v).” (p 233) 

But, this value of the constant capital can vary for different reasons. If productivity rises, a given mass of labour (v), will process a greater mass of material. So, whilst the unit value of this material remains the same (i.e. no change in the value composition of capital) or may even fall, the total value of c, relative to v may rise. So, if 100 workers process 1,000 kilos of yarn, costing £1 per kilo, a 20% rise in productivity will mean that the same labour now processes 1200 kilos. If wages are £1,000 the ratio of c:v rises from 1:1 to 1.2:1. Even if the price of yarn falls to £0.90 per kilo, c is still £1,080, so c:v still rises to 1.08:1. Here, c:v rises due to a rise in the technical composition of capital, even where the value composition falls. 

But, c may rise because the value of yarn rises itself, i.e. a rise in the value composition of capital, even if the technical composition remains constant or falls. So, 100 workers may continue to process 1,000 kilos of yarn, but, if the price of yarn rises to £1.20 per kilo, c rises to £1200, and c:v rises to 1.2:1. This is a rise in the value composition of capital. Where Marx's law of the tendency for the rate of profit to fall is based upon rising productivity, this rise in the value composition is a result of a fall in productivity, which increases the value of commodities that comprise constant capital. 

“In this case therefore, the variations in constant capital are not determined by the conditions of production prevailing in the industrial process into which it enters as constant capital, but are independent of them. Whatever the causes bringing about the change in value may be, they always influence the rate of profit. In this case, the same amount of raw material, machinery, etc., has more or less value than it did previously, because more or less labour-time was required to produce them. The variations, then, are determined by the conditions of production of the processes from which the component parts of constant capital emerge as products.” (p 233) 

Sunday, 19 May 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 149

The quantity of labour employed depends upon the technical composition of capital, as well as the minimum efficient scale of production in the given industry. Moreover, the amount advanced as wages depends on the production time for the particular commodity. Some commodities have a longer working period than others, and for all this time the capital is advanced for wages. Other commodities, such as wine, that require time to ferment, or corn that requires time to grow, after the seed has been planted, whilst not being the subject of labour, during this period, have still tied up the capital advanced as wages, until they can be sold. 

“... as well as on the length of time involved in the circulation of the commodity, the length of time required for the metamorphosis of the commodity, that is, the interval between its completion as a product and its reproduction as a commodity.” (p 229) 

Marx reiterates the point made in Capital III, Chapter 15, that, given the rate of surplus value, the mass of surplus value depends entirely on the number of workers employed, and if the number of workers employed is given, the mass of surplus value depends on the rate of surplus value. 

“But since profit is the ratio, not of the rate of surplus-value, but of the total amount of surplus-value to the total value of the capital advanced, then clearly its rate is determined not only by the rate, but also by the total amount of surplus-value, an amount which depends on the compound ratio of the rate and the number of working days, on the amount of capital expended on wages and the production costs of wages.” (p 231) 

Assuming that the rate of surplus value is the same in all industries, the amount of variable-capital in each industry depends on the organic composition of capital in that industry. The objection of the higher value of skilled labour-power, Marx addresses by assuming that the value created by this labour is proportional, so that the ratio of paid to unpaid labour remains the same. Given any rate of surplus value, the amount of surplus value rises or falls proportionate to the variable-capital. But, this does not apply to the rate of profit, because the rate of profit is the ratio of the surplus value to the total capital – constant and variable, and different organic compositions of capital mean that a rise in the total capital does not mean a proportional rise in the surplus value. 

“The amount of profit—as regards the different capitals—here depends on the ratio between the variable capital and the total capital, that is, on v/c+v. Thus, if the rate of surplus-value is given, and it is always expressed by s/v, by the ratio of surplus-value to variable capital, then the rate of profit is determined entirely by the ratio of variable capital to the total capital.” (p 231-2) 

A number of ratios are then involved here, in relation to the rate of profit, and changes in each of these ratios can result in a rise or fall in the rate of profit, brought about by different, and even contradictory causes. These come down to the difference between a squeeze on profits, as a result of a fall in the rate of surplus value, or a rise in the value composition of capital (i.e. a rise in the value/price of the commodities that comprise the constant capital, as opposed to a rise in the quantity of them processed by labour) as opposed to the long-term tendency for the rate of profit to fall, as a result of a rising technical composition of capital (causing a rise in the organic composition), caused by technological development, and rising productivity

“The rate of profit is thus determined, firstly, by the rate of surplus-value, that is, by the ratio of unpaid labour to paid labour; and it changes, rises or falls (insofar as this action is not rendered ineffectual by movements of the other determining factors), with changes in the rate of surplus-value. This, however, rises or falls in direct proportion to the productivity of labour and in inverse proportion to the value of labour, that is, to the production costs of wages or the quantity of necessary labour.” (p 232) 

Saturday, 18 May 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 148

Marx quotes Mill's statement that, 

““The only expression of the law of profits … is, that they depend on the cost of production of wages” (loc. cit., pp. 104-05).” (p 228) 

This is a basic Ricardian proposition, equating the rate of profit with the rate of surplus value. But, it is only true where the only capital advanced is that laid out in wages. Only if any materials or other means of production, that enter the production process, are not the product of labour would that be the case. But, as Marx previously demonstrated, with Adam Smith's example of the Scottish pebble collectors, virtually nowhere in capitalist production does such a condition apply. There are plenty of materials provided free by nature, which, thereby, also contribute to social wealth, (use value) but in every case, constant capital is required to transform them into products/commodities. Fish need to be caught, which requires nets etc., as well as the labour of the fishermen. Minerals are provided free by nature, but require mining equipment, as well as labour to extract them from the ground. What is true about these free gifts of nature, and makes them different to the raw materials used in manufacture, is that, because the former have no value, the increase in productivity that developing technology brings, does not result in a rise in the proportion of raw material value in output that exists in the latter, and is the mechanism for the law of the tendency for the rate of profit to fall. 

This is significant, for reasons I have set out elsewhere. Suppose that industry would prefer to use coal rather than wood to generate energy. However, the price of coal makes such use unprofitable. Assume that with existing technology, it would require 1,000 workers, working a 10 hour day, each paid £10 in wages, to dig 100 tons of coal. The price per ton, assuming a 100% rate of surplus value, is £200, and, at this price there is no demand, so no capital is employed, and no workers are employed. The £10,000 profit, is then only theoretical. But, if a new technology is developed, which enables the 1,000 workers to produce 100,000 tons, this situation changes. If the new technology costs £50,000, and lasts for 10 years, so that it amounts to a cost of production of £5,000 p.a. (wear and tear) the cost of production is £5,000 + £10,000 = £15,000. If the rate of surplus value remains 100%, so that the profit is £10,000, the price of the coal is now only £25 per ton. At this price, there is an adequate demand for the coal, and so the capital is advanced, the workers are employed, and the £10,000 of profit is no longer theoretical, but real, and available to accumulate additional capital. 

The rate of profit here is 10/15 = 66.66%, and the annual rate of profit is 10/60 = 16.66%. That is less than the theoretical 100% rate of profit that existed prior to the development of the new technology, but has the advantage of being real rather than theoretical. The rate of profit is equal to the ratio of the surplus value, s, to the total capital advanced, C, assuming the advanced capital turns over once during the year, i.e. s/C. Put another way, it is equal to the profit p as a proportion of the cost of production (c + v), or k, so p/k, which is also the formula for the profit margin

“This ratio is determined not only by the size of S [and all the factors which determine the production cost of wages enter into the determination of S] but also by the size of C. But C, the total value of the capital advanced, consists of the constant capital, c, and the variable capital, v (laid out in wages). The rate of profit is therefore S : (v+c)=S:C.” (p 229) 

But, S is not only determined by the rate of surplus value. It also depends upon the number of labourers simultaneously exploited. The rate of surplus value is always equal to the relation of unpaid labour to paid labour, in a working-day. If a working-day is 12 hours, and 2 hours constitute surplus labour, then the rate of surplus value is 2:10 = 20%. However, that does not determine what the mass of surplus value is, because that depends on the number of workers employed. If 10 workers are employed then 10 x 2 hours = 20 hours of surplus value, whereas if 100 workers are employed 100 x 2 = 200 hours of surplus value is produced. 

Northern Soul Classics - I'll Always Love You - Funk Brothers

Friday, 17 May 2019

Friday Night Disco - Don't Push It, Don't Force It - Leon Haywood

Theories of Surplus Value, Part III, Chapter 20 - Part 147

What is wrong with Mill's argument, here, is that the amount of corn the worker must consume is not determined by the value of the corn, but the quantity of use value required to reproduce the worker's labour-power. So, the worker does not have to consume 1.20 kilos of corn, rather than 1 kilo, as a result of the change in the value of corn. If the value of corn falls, then the kilo of corn that the worker must consume as wages falls in value. It represents a smaller portion of the working-day, leaving a larger portion of the working-day as surplus labour, thereby raising the rate of surplus value. If, as Marx said earlier, this is just a short term change in the market price, the money wage may remain the same, and, in that case, the worker might buy 1.20 kilos corn, but equally, they might use the savings on their purchases of corn to buy more meat, fish, beer, or just to take the opportunity to save money for another day. 

Marx now addresses himself to this point, and consequently sets out the argument whereby, contrary to what was said at the start of the section, in relation to short-term fluctuations in the price of wage goods, he shows that changes in the value of wage goods changes the value of labour-power, and consequently the rate of surplus value, with potentially then a change in the rate of profit

“Now comes the real question: How far can a change in the value of constant capital affect the surplus-value?” (p 226) 

This analysis is also fundamental to understanding Marx's insistence on the use of the value of the commodities that comprise the productive-capital, i.e. their current reproduction cost, as opposed to their historic cost, when calculating the rate of profit. It flows into Marx's analysis, in the coming chapters, in which Marx analyses the errors that flow from the use of historic prices, for that purpose, and the illusion that such use can create of the production of surplus value/profit from other sources than labour. It is what leads to the confusion of capital gains/losses with profit/losses derived from the production of surplus value

In the earlier example, Marx assumed a 12 hour working-day, in which 10 hours are necessary labour, equivalent to the labour-time required to reproduce the labour-power. The other 2 hours constitute surplus value. This could be represented as £100 wages, £20 profit. The £100 of wages is the value of labour-power, and is equal to the value of the commodities that the worker must consume to reproduce their labour-power. But, the value of these commodities is determined, as with any other commodity, not only by the living labour required for their production, but also by the congealed labour contained in the constant capital required for their production. So, to answer the above question, the answer is that not only is the value of these wage goods changed by the amount of immediate labour required for their production, i.e. a change in its productivity, but it is also affected by any change in the labour required to produce the constant capital used in their production. 

“This would lead either to a rise or to a fall in the production costs, i.e., the value, of labour-power; in other words, if previously out of the 12 hours the worker worked 10 hours for himself, he must now work 11 hours, or, in the opposite case, only 9 hours for himself. In the first case, his labour for the capitalist, i.e., the surplus-value, would have declined by half, from two hours to one; in the second case it would have risen by half, from two hours to three. In this latter case, the rate of profit and the total profit of the capitalist would rise, the former because the value of constant capital would have fallen, and both because the rate of surplus-value (and its amount in absolute figures) would have increased.” (p 226-7) 

The consequence of this, contrary to the argument that Mill presented, is that the value of labour-power, in any industry, is determined, not by the productivity of labour in that industry, but by the productivity of labour in all industries that produce commodities that either directly are consumed by workers, or else produce constant capital used in the production of those wage goods – and by extension the constant capital used in the production of constant capital used in the production of wage goods, and so on. 

“What appears as the product in one industry appears as raw material or instrument of labour in another; the constant capital of one industry thus consists of the products of another industry; in the latter it does not constitute constant capital, but is the result of the production process within this branch. To the individual capitalist it makes a great deal of difference whether the increased productivity of labour (and therefore also the fall in the value of labour-power) takes place within his own branch of industry or amongst those which supply his industry with constant capital. For the capitalist class, for capital as a whole, it is all the same.” (p 227-8) 

Thursday, 16 May 2019

I Can't Risk Voting Labour On 23rd May

For the first time in my life, I probably will not vote Labour, when it comes to the European Parliament elections, next week. I will vote for whichever party has the clearest “Stop Brexit” position, and which has the best chance of winning in the constituency. According to the data and analysis provided by Remain United that looks likely to be the Liberals, unless something significant changes between now, and a week today. It will stick in the craw, but the risk of voting, in these elections, for any party not clearly committed to stopping Brexit is just too great. 

The reasons that Marxists support the Labour Party, as the Workers Party, have been set out by me, in this blog many times. The Labour Party is the Workers' Party. Most Workers' Parties, like the Labour Party itself, are, in fact bourgeois, as are other workers' organisations, such as trades unions. They are necessarily bourgeois, because, as Marx describes, being determines consciousness, and the working-class, like everyone else exists within the context of a bourgeois society, and its ideas are conditioned by its everyday existence and experience within that bourgeois society. As Engels describes, in relation to the election of Workers Parties, in the context of parliamentary democracies, their success is a measure of the political maturity of the working-class, and nothing more. Marxists do not fetishise elections, nor do they fetishise voting for what amounts to one bourgeois party rather than another bourgeois party in those elections. 

Marxists support the Workers Party, in part, precisely because it is a bourgeois party. In other words, workers form bourgeois organisations, such as trades unions, cooperatives, and political parties, as a defensive response to the repeated attacks on their interests that occur naturally under capitalism. So, how on Earth are they to go beyond such purely defensive responses that remain within the confines of bourgeois ideology, unless Marxists stand alongside them, every step of the way, and illustrate, in action and in ideas, why it is necessary to go beyond those bourgeois solutions. We support the Workers Parties because we are not sectarians, we do not expect the workers to already be socialists as a condition for supporting them, and insist on standing aside from them for fear of infecting our own purity as a result of such contact. Our basic position is to stick with the workers and their mass organisations, however reactionary, at any one time, they might be. For example, when the British electricians and plumbers union, the EETPU, became a reactionary, anti-communist, authoritarian witch-hunting regime, under its General Secretary, Eric Chapple, Marxists did not abandon workers to their fate, within that union, but continued to work alongside them, to try to democratise and radicalise the union, to overturn the power of the right-wing leadership. 

But, nor do we fetishise the working-class itself either. The working-class is the agent of social change under capitalism. It is the means by which capitalism will be transcended, and socialism arise to take its place. But, that is by no means inevitable nor automatic. It requires the working-class, itself, to become conscious of its own role in history, and to then actively begin to make that history. That is precisely why Marxists' role is to assist the working-class in arriving at that level of consciousness, and begin to actively make its own history. That cannot be achieved if Marxists put themselves in the position, not of mentors of the working-class, but merely its cheerleaders, or worse simply seeking approval from workers, which means tailing the working-class, and whatever set of ideas it may have adopted at the particular time. When Marxists take up positions as trades union militants, it is not because we believe that workers' interests can at all be effectively defended or promoted by them, but that a) unless workers, at a minimum, attempt to organise to defend their interests, they will have no chance of creating the means of actually promoting their own interests, and b) in taking up those positions, and being the best fighters for the working-class, in those constrained conditions, we hope to earn the right to a hearing from the workers, so as to convince them of the need to go beyond those bourgeois solutions. But, there are times when Marxists, in those positions, have to stand down from them, rather than be the instrument for the implementation of reactionary ideas. 

Again, when we support the idea of the workers creating their own cooperatives, so that the division between capital and labour is dissolved in practice, it is not because we believe that these cooperatives, within the confines of a capitalist mode of production, are a solution to their problems, or an end in themselves. We support the creation of worker owned cooperatives, because they demonstrate, in practice, that workers do not need capitalists; they demonstrate that workers both by hand and by brain, both those that labour in production, and those that labour by organising and coordinating, and managing that labour, already perform all of the necessary functions to run production and society, and that the capitalists, and their extremely well remunerated agents, are now simply unnecessary, just as, once capitalist farmers arose, the role of landlords in agriculture became irrelevant and parasitic. 

And, the same is true with the Workers Party. We do not at all accept that the bourgeois ideas of the Workers Party are a solution to the workers problems or an adequate means of promoting workers' interests. We are always seeking to improve the ideas of the Workers Party, to move its programme in a more adequate direction, and thereby, at least in the realm of ideas, to move the consciousness of the working-class itself, in a more socialist direction. In 1979. for example, I, along with other Marxists in the Labour Party, called for a vote for Labour in the General Election, but not on the basis of Labour's official programme. We sought to mobilise Labour activists, trades unionists, CLP's and LP branches around a Socialist Campaign for a Labour Victory. I argued for a similar campaign in 2010, and, in the EU Referendum, in 2016, I argued that we needed a Socialist Campaign for Europe, along similar lines. 

I have also argued that we needed something similar for these European Parliament elections. Its not that there are not enough LP members that support an international socialist position in relation to Europe. Around 90% of LP members oppose Brexit. The majority of them do not want to simply offer workers the old Blair-right version of the EU, but want to adopt the same kind of progressive social-democratic agenda they rallied behind as part of the Corbyn surge, to be carried forward into our approach to Europe. Every indication is that the 75% of Labour voters, particularly all of the new young Labour voters that Labour pulled in in 2017, also support that progressive, internationalist, outward looking approach. We have a number of campaigns such as Love Socialism, Hate Brexit that reflect that. Yet, the fact is that when it comes to the vote next week, what voters will actually be confronted with is a Labour Party that has selected its candidates on a thoroughly undemocratic basis, whereby, on the one hand, old Blair-right MEP's have simply been put back up for election, and on the other hand, we have Stalinist hacks from within the party machine having been appointed as candidates where vacancies arose. 

We have a situation, whereby it is impossible to run an effective alternative socialist campaign for Labour in these elections, and where Labour's own programme for the elections is reactionary. If this were simply a General Election, local council elections, or even a European parliament election, under any other conditions, I would argue the need to vote Labour, but prepare to fight. But, it isn't. This election is more like a General Election in which the two main parties were more or less agreed on cancelling all future elections, because what we have is a common position between the leadership of both main parties to push through with Brexit. In a General Election, if the Labour Party is elected on an inadequate programme, it is still possible for socialists to work to highlight that fact, and to use it to mobilise the more advanced sections of the labour movement to change it. That does not apply with Brexit. If Britain is taken out of Europe, it prevents any such action. Britain would be out for at least a generation. Moreover, the reactionary consequences of such a decision, would begin immediately, and in themselves would put workers in a weaker position from which to fight back. 

For all of the insane pipe dreams of the Lexiters, the immediate beneficiary of Brexit will be Farage. But Farage is merely an advance scout for the same political strand within the right-wing of the Tory Party. At the start of this year, I predicted that May would call a snap General Election in February, on the basis of having once again made a sharp rightward turn to adopt a No Deal Brexit position. More correctly, I said that if she did not do that, she would be mad. In fact, in the intervening period, May has shown just what a totally incompetent politician she is. She failed to make that turn and call an election, which she would have had every chance of winning, whilst the Liberals were still in obscurity, and Labour was seen as a confused and dissembling outfit with no clear position on Brexit, and its leadership seen as merely a bunch of Brexit supporting also rans. May has failed repeatedly to get her deal approved, but also failed to respond to her failure. The result is that the Tory Party has seen the vast bulk of its support transfer directly to Farage and his Brexit company. 

The 34% support for Farage's Brexit company, is comprised almost entirely of Tory Leave voters. Put that together with the 12% remaining support for the Tories, and May, had she made a right turn, to promote a No Deal Brexit, and called an election on that basis, could have expected to have picked up around 40% of the vote, having perhaps lost 5-6% of the current 12%, who would not stomach such a No Deal position. But, with the rest of the population faced with supporting a Labour Party that itself appears committed to pushing through Brexit, it would have lost a large chunk of the support it obtained in 2017, as its members became demoralised, and its voters either sat on their hands, or switched their allegiance to the Liberals, Greens, Chukas, or to Plaid and the SNP. It would have been enough for May to get a clear parliamentary majority and push through her Brexit agenda. 

Now the decision for May looks set to be made for her. The Tory Right are set to remove her, and they will then make that turn, and call that election. Corbyn's Labour, in the meantime, has disgraced itself with the class collaborationist talks it has undertaken with the government, and which Barry Gardiner correctly described, when he said that Labour were “bailing out the government”. Its terrible position has merely acted to facilitate Farage. 

The upcoming European Parliament elections have, thereby, been turned into a proxy for a referendum on EU membership. In any such referendum, I would vote to remain in the EU, whatever position the Labour Party itself took on that issue. Consequently, it is only rational, in this vote, to do the same, and to vote for that party which most clearly represents opposition to Brexit, and has best chance of winning. As Remain United said, had Labour adopted a clear Stop Brexit position, then that party would have been Labour. But it hasn't. 

Indeed, the Labour leadership has done everything possible to undermine the party adopting such a position, including fudging the already fudged conference decision from 2018. What is more, the main representative of the rank and file of the party, Momentum, and its representatives on the NEC, also failed to ensure that the leadership was held to account, and the party policy, and wishes of the members enforced. The reason the leadership has been able to do that is that time and again, Momentum, and its Chief Executive, Jon Lansman, have pulled back from pushing through the democratic reforms required to vest power in the hands of the party membership. Its ironic that Lansman, a prominent member, in the 1980's, of the Campaign for Labour Party Democracy, which campaigned for the mandatory reselection of MP's, has time and again, refused to campaign for it now, at a time, when the Left is preeminent within the party, whilst the PLP is overwhelmingly dominated by right-wing, Blair-right, and soft left MP's, hostile to Corbyn and the party membership, and waiting at every opportunity to overthrow him, and attempt to regain control of the party for themselves. 

Had the last three and a half years been used to really democratise the party, to introduce mandatory reselection of MP's, including for MEP's, we would not have the position we have today. Nor would we have a position where the campaign for the European elections can be conducted essentially on a centralised basis, leaving no room for a more adequate socialist campaign for those elections to be organised, based on the grass roots membership. Labour's membership, and its electorate are overwhelmingly opposed to Brexit. In line with the party's insane triangulating policy of constructive ambiguity that is being used to try to claim both that Labour is committed to another referendum (but only on a Tory deal), and so is not a pro-Brexit party, whilst, at the same time, claiming that Labour is a pro-Brexit Party, and is seeking to achieve its own, impossible Brexit. No wonder only 13% of voters think that Labour has a clear position. 

In the 2017 General Election, it is clear that many people came to Labour because they wanted to oppose the Tories hard Brexit. They saw Labour as the best means of opposing that, and also the possibility that Labour, in the process, would stop Brexit altogether. That is obvious both from the fact that around 90% of party members want to stop Brexit, and 75% of Labour voters want to stop Brexit. Yet, the Tories and other Brexiteers have used every opportunity to claim that, because Labour fought the 2017 election on the basis that it would “respect the referendum vote”, this meant that 85% of voters in 2017, backed parties that support Brexit! That is an insane and totally duplicitous conclusion. 

But, it is a powerful piece of propaganda for the Brexiteers to use. There is no doubt that no matter how much Labour tries to be constructively ambiguous in its propaganda for the EU elections, whatever vote share it gets will be touted, by the Brextremists, as a vote for Brexit, in the same way. It will not be, because there will be many Labour voters, who will hold their nose, and vote Labour despite its pro-Brexit position, trying to convince themselves that Labour is committed to another referendum and so on. And, yet, the Brexiters will have some point, because the truth remains that no matter how much we know that the Labour Party, as defined by its members, is an anti-Brexit Party, the truth will still be that the Labour leadership have shown, by all their actions, that they are pro-Brexit, and prepared to ride roughshod over the wishes of members and voters to try to push through that agenda. 

The EU Parliament elections will be a proxy for another referendum. It is necessary to maximise the anti-Brexit vote in those elections, in order to deny the reactionary Brexiters the propaganda tool they desire. Farage's Brexit company is on 34%, and the Tory media continually present this as though it were a majority. It clearly is not. It is only a third of the potential electorate. Even adding in the rest of the Tory vote (much of which is now actually Tory Remainers, not Leavers), and the handful of votes going to UKIP, it remains a minority. And, just as the Tory vote has collapsed into the Brexit company, so Labour's vote is increasingly collapsing into the Liberals, Greens, SNP and Plaid. Most of Labour's vote will be comprised of Remainers who do not switch their vote, but the Brextremists will try to claim that Labour's vote is a vote for a Brexit supporting party. We should not give them that opportunity. 

It would have been better had Labour called off its class collaborationist talks with the Tories, and come out some time ago to clearly oppose Brexit. Then the anti-Brexit vote could have been mobilised behind Labour, and on the basis of carrying a progressive social-democratic agenda into Europe itself. Labour has failed to do that. So, for now, it is necessary, in these elections, to vote for the anti-Brexit parties with the best chance of winning seats, which appears to be Liberals in England, Plaid in Wales, and SNP in Scotland. 

Socialists should continue to fight to hold the Labour leadership to account, and to push forward with the required democratic reforms. We need to organise for a recall conference to establish a clear, internationalist, anti-Brexit position, and demand that the leadership fight for it, or get out of the way. A tactical vote for another bourgeois party in these elections other than the Labour Party, to stop Brexit, is a very small price to pay. If we stop Brexit, we can then continue to transform the Labour Party, and make it more adequate to our needs. Then we can be in a position to take on all of these other bourgeois parties from a stronger position. 

Theories of Surplus Value, Part III, Chapter 20 - Part 146

The opposite is the case where a good harvest results in the supply of cotton exceeding the demand, so that market prices fall below the exchange-value/price of production. The same thing applies, as I have set out elsewhere, in relation to the long wave cycle. At the start of periods of strong global increases in output, where new technological developments also result in rapid increases in demand for inputs, the process that Marx describes, above, whereby primary producers gear their output to expected increases in demand, fail to keep pace. During all of the stagnation/Winter phase of the long wave cycle (i.e. about 12-15 years), the growth in this demand is sluggish. Primary producers are reluctant to invest in new facilities, and seek to simply exploit existing mines, quarries, oil and gas fields more exhaustively. Only when they are convinced that demand is increasing sustainably do they start to engage in exploration and the development of new facilities. But, these, in turn, take around 12 years to reach optimum production, and in the meantime primary product prices continue to rise. That is what was seen between 1999-2014. When all the new production does hit the market, it represents an oversupply, which results in sharp falls in market prices of those primary products, as seen in 2014. 

The rate of profit—and possibly, as we saw above, the total amount of profit—increases, consequently, not only in the proportion in which it would have increased had the cotton which has become cheaper been sold at its value; but it increases because the finished article has not become cheaper in the total proportion in which the cotton-grower sold his raw cotton below its value, that is, because the manufacturer has pocketed part of the surplus-value due to the cotton-grower. This does not diminish the demand for his product, since its price falls in any case due to the decrease in the value of cotton. However, its price does not fall as much as the price of raw cotton falls below its own value.” (p 223) 

Marx notes, 

“In cases in which the price of the raw material declines, not as a result of a permanent or continuous fall in its average production costs but because of either an especially good or an especially bad year (weather conditions), the workers’ wages do not fall, the demand for labour, however, grows. The effect produced by this demand is not merely proportionate to its growth. On the contrary, when the product suddenly becomes dearer, on the one hand many workers are dismissed, and on the other hand the manufacturer seeks to recoup his loss by reducing wages below their normal level. Thus the normal demand on the part of the workers declines, intensifying the now general decline in demand, and worsening the effect this has on the market price of the product.” (p 223) 

Marx then quotes passages from Mill, which demonstrate the fallacy of his argument. But, Marx’s argument against them also contradicts the position he has just outlined, in relation to short-term changes in the price of wage goods. Mill says, 

““If the cost of production of wages had remained the same as before, profits could not have risen. Each labourer received one quarter of corn; but one quarter of corn at that time was the result of the same cost of production as 1 1/5 quarter now. In order, therefore, that each labourer should receive the same cost of production, each must […] receive one quarter of corn, plus one-fifth” ([John Stuart Mill, Essays on some unsettled Questions of Political Economy, London, 1844,] p. 103). 

“Assuming, therefore, that the labourer is paid in the very article he produces, it is evident that, when any saving of expense takes place in the production of that article, if the labourer still receives the same cost of production as before, he must receive an increased quantity, in the very same ratio in which the productive power of capital has been increased. But, if so, the outlay of the capitalist will bear exactly the same proportion to the return as it did before; and profits will not rise.” (This is wrong.) “The variations, therefore, in the rate of profits, and those in the cost of production of wages, go hand in hand, and are inseparable. Mr. Ricardo’s principle […] is strictly true, if by low wages be meant not merely wages which are the produce of a smaller quantity of labour, but wages which are produced at less cost, reckoning labour and previous profits together” (loc. cit., p.104).” (p 225) 

Wednesday, 15 May 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 145

Mill gets confused, Marx says, between surplus value and profit, because he confuses the cost of producing surplus value, and the cost of producing profit. The former depends only on wages, whereas the latter depends on the total capital advanced. On the basis of Mill's argument, Marx says, it would take longer for a worker to reproduce their wages, if the materials they process are more expensive than if they are cheap. But, the necessary labour-time depends on the value of the commodities they consume, not the commodities they produce. The capitalists are concerned with their rate of profit, which is why they are concerned to minimise the value of their constant capital, which forms a growing proportion of the value of their output. 

“This analysis shows the importance of the cheapness or dearness of raw materials for the industry which works them up (not to speak of the relative cheapening of machinery), even assuming that the market price is equal to the value of the commodity, that is, that the market price of the commodity falls in exactly the same ratio as do the raw materials embodied in it.” (p 221-2) 

Marx also comments in a note, 

“By relative cheapening of machinery, I mean that the absolute value of the amount of machinery employed increases, but that it does not increase in the same proportion as the mass and efficiency of the machinery.” (Note *, p 221) 

Marx says that Torrens is, therefore, correct when he says, 

“In relation “… to a country in the condition of England, the importance of a foreign market must be measured not by the quantity of finished goods which it receives, but by the quantity of the elements of reproduction which it returns” (R. Torrens, A Letter to [the Right Honourable] Sir Robert Peel […] on the Condition of England etc., second ed., London, 1843, p. 275).” (p 222) 

In other words, Britain sought to obtain cheap raw materials and foodstuffs as imports, in return for the high value manufactured goods it exported. The cheaper it could obtain those inputs, required for the reproduction process, the higher its rate of profit, the greater its potential for expansion, because a given mass of profit, thereby accumulated a greater mass of the physical components of capital. 

But, Torrens' explanation of this, Marx says, is wrong. Torrens' explanation is based on supply and demand. So, Torrens argues that a more rapid growth in Britain, which produces cotton goods, than in the US, which supplies it with cotton, would result in an increased demand for cotton, and rise in cotton prices, so that the price of cotton goods would fall, relative to cotton. Marx sets out another argument here, also described in Capital III, Chapter 6. That is that where demand for cotton rises, as here described by Torrens, the market price of cotton may indeed rise, but this is a rise in the market price, above its exchange value/price of production, as a result of supply failing to increase to match demand. Furthermore, the rise in the price of cotton may be such that the textile producer cannot pass it on, because to do so would severely depress demand for their own output. So, the manufacturer must absorb some or all of the rise in the cotton price, out of their own profits, so that a profits squeeze arises. In effect, the cotton grower, by selling cotton above its value, appropriates some of the surplus value of the textile manufacturer. The same thing occurs where monopoly producers are able to appropriate surplus profits. 

“The demand for raw materials—raw cotton, for example—is regulated annually not only by the effective demand existing at a given moment, but by the average demand throughout the year, that is, not only by the demand from the mills that are working at the time, but by this demand increased by the number of mills which, experience shows, will start operating during the course of the coming year, that is, by the relative increase in the number of mills taking place during the year, or by the surplus demand corresponding to this relative increase.” (p 222-3) 

Tuesday, 14 May 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 144

The industrial capitalists sought to repeal the Corn Laws, because, in doing so, it would mean that the cost of providing the food required by their workers was reduced, so that they could pay them less in money wages. They did not do so so that they could keep paying the workers the same money wages, so that their workers could buy more food, or use the savings to buy additional commodities. Money wages may rise above or fall below the value of labour-power, where such temporary phenomenon raise or lower the value of the wage goods required for the reproduction of labour-power, but such fluctuations cancel each other out. Any more permanent change in the value of wage goods changes the value of labour-power, and consequently the level of wages, and rate of surplus value

However, whilst money wages, and the rate of surplus value may remain constant, in such conditions, the same is not true for the rate of profit. If the price of cotton falls sharply, due to a bumper harvest, this reduces the value of the constant capital of the spinner. If the spinner continues to produce on the same scale, the value of their output will fall. For example, suppose they buy 1,000 kilos of cotton, at a price of £100, and employ 10 workers to process it, at a wage of £10 each (£100), and they produce surplus value of £20. The rate of surplus value is 20%, and rate of profit 10%. If the output is 1,000 kilos of yarn, it has a value of £220, or £0.22 per kilo. If the spinner now buys the cotton for £50, their costs are: 

£50 c + £100 v = £150. 

The surplus value is still £20, so that the value of output falls to £170, or £0.17 per kilo. The yarn sold to the weaver then similarly reduces their costs, which reduces the value of the cloth they produce, which reduces the costs of the clothes producers. The cost of clothes bought by workers falls, but Marx assumes this is a temporary phenomenon so that workers' money wages remain the same, enabling them to temporarily increase their consumption. 

Going back to the spinner, therefore, the money wages they pay to their workers remains £100, and as these workers still produce £120 of new value, by their labour, £20 of surplus value is produced. So, the amount and rate of surplus value remains constant. However, as a result of the fall in the price of cotton, to £50, the total capital advanced by the spinner has fallen from £200 to £150, so that now the rate of profit rises from 10% to 13.3%. 

Marx points out that, if the spinner uses the fall in the value of cotton, and release of capital, thereby, to increase output, not only the rate of profit, but also the mass of profit can rise. So, the spinner can now buy twice as much cotton for £100, as they could before. But, to process it, they require twice as many workers. So: 

£100 c + £200 v + £40 s. 

The rate of surplus value remains 20%, but the mass of surplus value now doubles, because twice as much labour is employed. The reverse is true where the price of cotton rises. This is the same situation that Marx discusses in Capital III, Chapter 6. In other words, a sharp rise in material prices causes the rate of profit to fall. Moreover, if the rise in material prices is sufficient, the capitalist may have to cut back the scale of their operation, employing less material and less labour to process it. In that case, the amount of surplus value falls, because less labour is employed. 

“The result would be the same if, owing to a bad harvest, there were not enough cotton available to absorb the same amount of living labour as formerly.” (p 219) 

That is the same situation that Marx describes in Capital III, Chapter 6, where the US Civil War caused the supplies of cotton to the UK cotton mills to be cut off. So, labour had to be laid off, leading to a breakdown in the circuit of capital, and an economic crisis. 

“Thus, when the rate of surplus-value, that is, when the value of labour, remains unchanged, a change in the value of constant capital must produce a change in the rate of profit and may be accompanied by a change in the total amount of profit.” (p 220) 

Monday, 13 May 2019

Theories of Surplus Value, Part III, Chapter 20 - Part 143

[c) On the Influence a Change in the value of Constant Capital Exerts on surplus-value, Profit and Wages

This section demonstrates why it is important to take Marx's writings as a whole into consideration, rather than taking particular phrases and even paragraphs in isolation. Marx sets out, at the start of the section, an argument in relation to wages, which he then completely reverses in the latter part of the section. The point relates to a question raised earlier, in relation to the effect of a fall in the value of constant capital, used in the production of wage goods. Marx begins the section by arguing that such a fall cannot affect wages, or the rate of profit. But, in the latter part of the section, Marx says this is only true if the change is merely a short-term, temporary change in prices. 

So, for example, if there is a bumper cotton crop that reduces the price of cotton, this reduces the value of constant capital, used by the yarn producer, weaver, and clothes producer. That, in turn reduces the price of clothes, for example, cotton shirts, blouses, skirts and trousers. As workers buy these items, it reduces what they have to spend on them as wage goods, to reproduce their labour-power. In value terms, therefore, the value of labour-power has fallen, so that wages should also fall, and so surplus value, and the rate of surplus value rise. However, Marx makes the point that, in practice, with workers paid money wages, the effect is that they now have to spend less of their wages on these items, so either they can buy more of them, or else they can use the money saved to buy more of some other commodities, or even some totally new commodity. 

But, later in the section, Marx makes clear that whilst this is true for such short-term fluctuations – the opposite would apply where a bad harvest next year caused cotton prices, and so clothes prices to rise – which average out, it is not true for those permanent changes in the value of the commodities that comprise the constant capital, and which, thereby, influence the price of wage goods. In short, it is a distinction between market prices, and exchange values. As Marx himself makes clear, as against Mill, the worker requires a certain minimum of use values, for their reproduction, and this minimum is not changed by the value of those use values. 

Sunday, 12 May 2019

Value and Its Historical and Logical Development - An Exchange On The Use of Value - Part 2

In Part 1 of this series, I set out an introduction to an analysis of the history of value, in relation to discussions in the pages of the Weekly Worker, on the matter. In this second part, I continue to examine this historical and logical development of value, in the context of an exchange of views on the matter, with John Bridge.

John Bridge, in his letter, notes, 

“According to Moshé, Marx is of the view that value - ie, exchange value, as opposed to use-value - exists “under any form of social organisation”. Well, looking through the text of Marx’s 1868 letter, that contention is simply unsupportable. Marx does not argue that value exists “under any form of social organisation”. 

Anyone who has been reading my blog posts over the last few months, looking at Marx's analysis in Theories of Surplus Value, Chapter 20, will immediately see what is wrong with this statement, because, in it, Comrade Bridge explicitly equates value with exchange value, in opposition to use value. But, in considerable detail, in Theories of Surplus Value, Chapter 20, Marx draws out the difference between value and exchange value, demonstrating that these are, necessarily, two different concepts, and that, before exchange-value can come into existence, value itself must exist, just as before commodities can exist, products must exist. A product, as Marx describes, in the opening chapter of Capital I, is a use value that has been produced by free human labour, as opposed to having been provided free by Nature. A product, Marx says, has value, whereas a use value provided free by Nature does not, precisely because the former is the product of this free human labour. 

“A thing can be a use value, without having value. This is the case whenever its utility to man is not due to labour. Such are air, virgin soil, natural meadows, &c. A thing can be useful, and the product of human labour, without being a commodity. Whoever directly satisfies his wants with the produce of his own labour, creates, indeed, use values, but not commodities. In order to produce the latter, he must not only produce use values, but use values for others, social use values.” 

(Capital I, Chapter 1) 

In other words, it is a product, containing both use value, and value, but it is not a commodity, and consequently does not have an exchange-value. It is not an exchange-value, precisely because, and only because, it is not produced for, or placed in a position of being exchanged for some other product. But, this product certainly is, and does have value, for the reason that Marx set our earlier in the chapter. 

“Let us now consider the residue of each of these products; it consists of the same unsubstantial reality in each, a mere congelation of homogeneous human labour, of labour power expended without regard to the mode of its expenditure. All that these things now tell us is, that human labour power has been expended in their production, that human labour is embodied in them. When looked at as crystals of this social substance, common to them all, they are – Values. We have seen that when commodities are exchanged, their exchange value manifests itself as something totally independent of their use value. But if we abstract from their use value, there remains their Value as defined above. Therefore, the common substance that manifests itself in the exchange value of commodities, whenever they are exchanged, is their value. The progress of our investigation will show that exchange value is the only form in which the value of commodities can manifest itself or be expressed. For the present, however, we have to consider the nature of value independently of this, its form.” 


So, Marx, here, in this final sentence, specifically delineates value from exchange-value. Exchange-value is merely the form in which the value of a commodity manifests itself, but value as opposed to exchange-value exists “independently of this, its form” as manifest in the commodity. What is value? It is, as Marx sets out above, the amount of abstract labour embodied in a product. Its measure is abstract labour-time. This is the direct and immanent measure of value, as Marx discusses in Theories of Surplus Value, Chapter 20. 

For example, responding to the subjectivist Samuel Bailey, who also equates value, with exchange-value and price, Marx says, 

““There is, in actual fact, a very significant difference (which Bailey does not notice) between “measure” (in the sense of money) and “cause of value”. The “cause” of value transforms use-values into value. The external measure of value already presupposes the existence of value. For example, gold can only measure the value of cotton if gold and cotton—as values—possess a common factor which is different from both. The “cause” of value is the substance of value and hence also its immanent measure.” 

What, by contrast, is exchange-value? It is the form that this value takes, when the product itself becomes a commodity. Instead of being the direct, immanent measure of value, it can only exist as a secondary, external, relative measure of value, as Marx describes in Theories of Surplus Value, Chapter 20. In other words, I can directly measure the value of a litre of wine as being 10 hours of abstract labour-time, but I cannot measure the exchange-value value of that litre of wine in that way. 

I can only measure the exchange-value of a litre of wine as being the quantity of some other use value that I can obtain in exchange for it. In other words, I can variously measure the exchange-value of a litre of wine as being 1 metre of linen, or it might be 10 kilos of corn, or alternatively 1 gram of gold. What is it that establishes this exchange value, this exchange relation between these disparate use values? It is precisely, as Marx states above, that before they are commodities, they are first of all products, each of which has a value, completely independent from subsequently also becoming a commodity, and thereby having an exchange-value. The product and value is necessarily, logically and historically prius to the commodity and to exchange-value. Exchange-value is not just the form in which value manifests itself for commodities, it is a derivative of value. I can only determine that a litre of wine has an exchange value of 1 metre of linen, because I know that a litre of wine has a value of 10 hours of abstract labour-time, and a metre of linen also has a value of 10 hours of abstract labour-time. If exchange-value is a derivative of value, then clearly value and exchange-value cannot be the same thing, and it is impossible to derive something from something else that does not itself exist, independently, and prior to this derivation. 

Unless these commodities exist as products, each with their own intrinsic value, determined by and measured in abstract labour-time, it is impossible to establish any objective relation between them whatsoever. It is only because these commodities, as products, are repositories of an equal amount of value, of an equal amount of abstract labour that any equivalence between them can be derived. In fact, as Marx points out, in Theories of Surplus Value, a commodity is only a commodity when it is actually thrown on to the market, so that its value, can be expressed as an exchange-value. 

If we take a product that is not a commodity, as defined by Marx above, in Capital I, then it is quite clear that such a product has value. In Capital I, Marx says, 

“The mediaeval peasant produced quit-rent-corn for his feudal lord and tithe-corn for his parson. But neither the quit-rent-corn nor the tithe-corn became commodities by reason of the fact that they had been produced for others. To become a commodity a product must be transferred to another, whom it will serve as a use value, by means of an exchange.)” 

Did these products have value, even though they were not commodities? Certainly they did. Moreover, in Capital III, in examining pre-capitalist forms of rent, Marx details the historical development, from Labour-Rent, To Rent in Kind, to Money Rent. How could this latter form of feudal rent be possible, unless the product of the peasant represented a quantity of value? The Money Rent is merely the value of the product, paid as Rent In Kind, converted into an exchange-value, i.e. the exchange value of that product expressed in money. 

Discussing commodity fetishism, and the way exchange-value hides the true nature of value, as determined by labour-time, Marx says, in Capital I, Chapter 1 

“The determination of the magnitude of value by labour time is therefore a secret, hidden under the apparent fluctuations in the relative values of commodities. Its discovery, while removing all appearance of mere accidentality from the determination of the magnitude of the values of products, yet in no way alters the mode in which that determination takes place.” 

Marx then goes on to strip away that fetishism that exists as a result of the measurement of value indirectly, as exchange value, by examining the actual determination of value from the perspective of Robinson Crusoe, who measures the value of all the products he requires for his existence on the basis of the labour-time he requires for the production of each. As Marx says, 

“All the relations between Robinson and the objects that form this wealth of his own creation, are here so simple and clear as to be intelligible without exertion, even to Mr. Sedley Taylor. And yet those relations contain all that is essential to the determination of value.” 

And, Marx also then gives the example of the medieval peasant, and this payment of Rent in Kind. 

“Personal dependence here characterises the social relations of production just as much as it does the other spheres of life organised on the basis of that production. But for the very reason that personal dependence forms the ground-work of society, there is no necessity for labour and its products to assume a fantastic form different from their reality. They take the shape, in the transactions of society, of services in kind and payments in kind. Here the particular and natural form of labour, and not, as in a society based on production of commodities, its general abstract form is the immediate social form of labour. Compulsory labour is just as properly measured by time, as commodity-producing labour; but every serf knows that what he expends in the service of his lord, is a definite quantity of his own personal labour power.” 

I will continue this analysis in the context of the discussion with John Bridge in Part 3