But, of course, what applies to labour in Bailey's argument here, also applies to profits. If the value of corn rises, but the money wages of workers do not, then the value of labour/wages have fallen relative to corn. On the basis set out by Marx, that the value of labour-power is actually determined by the quantum of use values required for the reproduction of that labour-power, a rise in the value of corn would raise the value of labour-power, whatever may have been the case with the historic price/money wages paid to workers. To reproduce that labour-power, a greater proportion of the output of corn, from current production will have to be set aside for workers, and there will have to be increased money wages to buy it.
A smaller proportion of society's total production of corn is then available as surplus product, and, to the extent that money wages rise, so that workers can buy the amount of food they need, money profits will be reduced. But, similarly, it's clear that, whatever those money profits might be, they will now buy a proportionally smaller amount of corn, now that its value has risen. The rate of profit cannot be measured against the historic prices of the capital advanced, to produce those profits, as Bailey, and the proponents of the Temporal Single System Interpretation argue, but only against the current reproduction cost of those elements of capital. It is that proportional relation which gives the true nature of the extent to which the capital has self-expanded.
So, for example, the degree to which a miller can expand their production of flour, with €100 of profits, is determined not by the €10 per 100 kilo of corn he advanced last year, but by the €12 per 100 kilos of corn he must pay currently. The farmer, who uses the corn he produces himself, as seed, may only increase the seed they sow by 100 kilos, as they have done in other years, but the value of this seed, as part of their constant capital, now represents a value of €12 rather than €10. And, of course, the same is true in relation to the proportion in which a given amount of money profit can accumulate variable-capital. If, as a result of the rise in corn prices, wages rise from €10 to €12 per worker, the €100 of profit will now employ only an additional 8.5 workers, whereas previously it would have employed 10.
Marx states, this, clearly, later in Chapter XX, when he writes,
“The rate of profit (that is, the ratio of surplus-value to the total value of the capital advanced) can increase either because the quantity of capital [goods] advanced by the capitalist becomes objectively cheaper (due to the increased productivity of labour in those spheres of production which produce constant capital) or because it becomes subjectively cheaper for the buyer, since he pays for the goods at less than their value. For him, it is then always the result of a smaller quantity of labour.” (p 193)
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