Proudhon's method is to determine successive historical stages, each of which he perceives following logically from the one before it. As part of such a logical progression, or unfolding of The Idea, this is necessarily manifest first in Men's minds, and, then, enacted in the real world, as each individual proposes to others its implementation. In fact, Proudhon misses out a whole epoch of human society, in setting out this historical schema, i.e. he misses out all of that period of primitive communism, in which there were unsatisfied needs, as well as division of labour, but no exchange, and so no exchange-value.
On this basis,
“Exchange has a history of its own. It has passed through different phases.” (p 33)
The first is that when only surplus products are exchanged, followed by another when all products become the subject of exchange, and production itself depends upon exchange.
“How are we to explain this second phase of exchange – marketable value at its second power?” (p 33-4)
And, that is followed by another phase in which everything, including “virtue, love, conviction, knowledge, conscience, etc.” can be bought and sold. How is this to be explained?
“M. Proudhon would have a reply ready-made: Assume that a person has “proposed to other persons, his collaborators in various functions,” to make a marketable value out of virtue, love, etc., to raise exchange value to its third and last power.” (p 34)
In other words, Proudhon explains nothing, because he simply assumes what has to be explained. He has no basis for these assumptions, other than that, with the benefit of hindsight, they appear to be logical solutions to a problem.
Marx moves on to Proudhon's description of the relation of use-value and exchange-value. I will let Marx summarise this description.
“If we have thoroughly grasped M. Proudhon’s thought the following are the four points which he sets out to establish:
- Use value and exchange value form a “surprising contrast,” they are in opposition to each other.
- Use value and exchange value are in inverse ratio, in contradiction, to each other.
- Economists have neither observed nor recognized either the opposition or the contradiction.
- M. Proudhon’s criticism begins at the end.” (p 35)
Proudhon's claim that economists had not recognised the opposition and contradiction of use-value and exchange-value was nonsense. In fact, as far back as Aristotle, this duality, within the commodity, had been noted. Marx quotes comments from Sismondi and Lauderdale to disprove Proudhon's assertion. And, Marx notes,
“Sismondi founded on the opposition between use value and exchange value his principal doctrine, according to which diminution in revenue is proportional to the increase in production.
Lauderdale founded his system on the inverse ratio of the two kinds of value, and his doctrine was indeed so popular in Ricardo’s time that the latter could speak of it as of something generally known.” (p 35)
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