Last updated on December 6, 2020
This post in the Anticapitalist Chat supports a group reading of Karl Marx’s Capital Vol 1. #GoodMorningMarx #WeeklyMarx.
Not quite this type of commodity, but more like a pork barrel.
M. Proudhon has the misfortune of being peculiarly misunderstood in Europe. In France, he has the right to be a bad economist, because he is reputed to be a good German philosopher. In Germany, he has the right to be a bad philosopher, because he is reputed to be one of the ablest French economists. Being both German and economist at the same time, we desire to protest against this double error.
The reader will understand that in this thankless task we have often had to abandon our criticism of M. Proudhon in order to criticize German philosophy, and at the same time to give some observations on political economy.
Marx famously opens the first volume of Capital with the statement that ‘The wealth of societies in which the capitalist mode of production prevails appears as an “immense collection of commodities”; the individual commodity appears as its elementary form. Our investigation therefore begins with the analysis of the commodity’ (1990: 125). So, what’s a commodity? Well, to start with, a commodity is a product or service that’s bought and sold on the market on the basis that it satisfies someone’s needs or wants. This useful characteristic of the commodity Marx calls its use-value. Simply put, ‘The usefulness of a thing makes it a use-value’ (1990: 126). You might buy a cup so that you can drink from it or a bed in order to sleep in it.
Use-value is therefore comprised of a commodity’s material characteristics—the shape and solidity of the cup, for instance, which allows it to hold and carry liquid—and so is a matter of its qualitative properties. Use-values, then, ‘constitute the material content of wealth’ in all societies, as Marx writes, ‘whatever its social form may be. In the form of society to be considered here they are also the material bearers of exchange value’ (1990: 126). In other words, a cup is a cup, whether it was made by a medieval craftsman or mass produced in a factory. But where its social form in a feudal economy might be a tribute or a tithe, in a capitalist economy it is a commodity, which has both a use-value and an exchange-value.
A commodity’s exchange-value is its quantitative aspect. That is, what you can trade it for on the market. For one cup, perhaps you can get a pair of socks. The exchange-value of a cup is thus a pair of socks, and vice versa. Or four knives. Or a hat. A commodity has many exchange-values. There’s an equivalence here between a cup, a pair of socks, four knives and a hat, insofar as they are all interchangeable amounts of something else. In other words, their exchange value must be a ‘form of appearance’, as Marx says, ‘of a content distinguishable from it’ (1990: 127). What is this something else, this ‘third thing’’ (1990: 127) as Marx calls it, that the cup and the hat have in common?
It cannot be a matter of their material properties, since it is precisely the abstraction from use-value that renders these objects exchangeable, an abstraction that occurs at the moment of exchange. What’s left when we abstract from the useful, concrete, material properties of a commodity? What’s left is that they are products of human labour, and not particular, concrete acts of labour—cup making or hat stitching—but ‘human labour in the abstract’, in Marx’s words (1990: 128). Whenever we abstract from the use-values of commodities in the act of exchange, Marx writes:
- There is nothing left of them in each case but the same phantom-like objectivity; they are merely congealed quantities of homogenous human labour, i.e. of human labour-power expended without regard to the form of its expenditure. All these things now tell us is that human labour-power has been expended to produce them, human labour is accumulated in them. As crystals of this social substance, which is common to them all, they are values (1990: 128).
The value of a commodity is not the measure of an individual’s concrete, particular labour, but of ‘human labour in the abstract’, which is to say a social average, or what Marx calls socially necessary labour time, which is the average time socially necessary to produce a given commodity.
Labour in a capitalist economy therefore has a dual character. It is both concrete labour, or the particular form of labour that produces a cup, for instance, and abstract labour, or labour abstracted from its concrete particulars in the act of exchange. Marx notes that he was ‘the first to point out and examine critically this twofold nature of the labour contained in commodities’, and states that ‘this point is crucial to an understanding of political economy’ (1990: 132). This category of abstract labour is crucial on several levels: it is distinct from the concrete particular activity of a given form of useful labour; it is a purely social determination, abstracted from the material properties of a commodity’s use-value; its existence is peculiar to capitalist society; and it is the source of value in a capitalist economy.
What is value? To explain this mysterious thing called value, Marx famously uses the example of 20 yards of linen, which for purposes of explication he says are worth one coat. Here, we are working with two commodities in isolation, linen and a coat, and it’s entirely arbitrary or accidental which commodities we use for this thought experiment. So, if 20 yards of linen are worth one coat, then the value of the linen is expressed in the form of a coat. The linen now has a ‘value-form’ distinct from its physical form as linen. The coat ‘represents’ the value of the linen, which exists only as a relation between the two commodities: Marx writes, ‘in the expression of value of the linen the coat represents a supra-natural property: their value, which is something purely social’ (1990: 149).
In this simple expression of the value-relation there is a relative form, the linen, and an equivalent form, the coat. In other words, the relative form of value, the linen, is valued in relation to the coat, which is therefore the equivalent form of value in this equation. The inverse is also true. If we then expand this equation, to consider for instance that 20 yards of linen are not only worth one coat, but also ten pounds of tea and two ounces of gold, we now have an expanded form of value, which is nothing other than many simple forms of value considered together. If we invert this string of equations into the general form of value, we can say that a coat, ten pounds of tea and two ounces of gold are all worth the same amount, represented here by the 20 yards of linen, which has now assumed the form of a ‘general equivalent’. And ‘by social custom’, Marx argues, the money-form of value comes to assume the role of a ‘universal equivalent’ (1990: 162-63), here represented by the two ounces of gold. In this manner, Marx is able to solve the mystery of how it is that things which are entirely different from each other in their material properties can somehow come to be exchanged as equals on the market.
Yet there remains something rather strange about a commodity. On the one hand, a commodity—a table, for instance—is a thing with material properties and subjective utility. It is made of wood, and there is a demand for it because it is useful to its owner to eat or write upon, or perhaps to burn as firewood. In this, its use-value, the table is ‘an extremely obvious or trivial thing’, as Marx writes, ‘an ordinary, sensuous thing’ (1990: 163), perceptible to the senses and entirely lacking in mystery. ‘But as soon as it emerges as a commodity’, Marx continues, ‘it changes into a thing that transcends sensuousness. It not only stands with its feet on the ground, but, in relation to all other commodities, it stands on its head, and evolves out of its wooden brain grotesque ideas’ (1990: 163).
What could Marx possibly mean by this? A table, standing on its head, sprouting grotesque ideas from a wooden brain? This rather gothic poetic passage is in fact a dramatic and suggestive way of gesturing to what Marx calls the ‘mystical’ or ‘enigmatic character’ of the commodity form, which:
- arises from this form itself. The equality of the kinds of human labour takes on a physical form in the equal objectivity of the products of labour as values; the measure of the expenditure of human labour-power by its duration takes on the form of the magnitude of the value of the products of labour; and finally the relationships between the producers, within which the social characteristics of their labours are manifested, take on the form of a social relation between the products of labour. The mysterious character of the commodity-form consists therefore in the fact that the commodity reflects the social characteristics of men’s own labour as objective characteristics of the products of labour themselves (1990: 164-65).
What we find in capitalist society is a world in which relations between people are mediated by things: in other words, you have social relations between things, and material relations between people. And it is in this section on ‘The Fetish-Character of the Commodity and its Secret’ that Marx explains that what distinguishes his critical approach is attention to the form of value:
- Political economy has indeed analysed value and its magnitude, however incompletely, and has uncovered the content concealed within this form. But it has never once asked the question why this content has assumed that particular form, that is to say, why labour is expressed in value, and why the measurement of labour by its duration is expressed in the magnitude of the value of the product. These forms, which bear the unmistakable stamp of belonging to a social formation in which the process of production has mastery over man, instead of the opposite, appear to the political economists’ bourgeois consciousness to be as much a self-evident and nature-imposed necessity as productive labour itself (1990: 173-75).
At the outset, capital appears as money. The capitalist spends the money to buy commodities of equivalent value: labour power, machinery, semi-finished products, energy and raw materials. At this second ‘moment’ in the circulation process, value resides (as does capital) in these various commodities, waiting to be incorporated in production. In the next ‘moment’, workers use their labour power, under the direction of the capitalist, to re-shape the raw materials and semi-finished products to make a new commodity. This labour process preserves and transfers the pre-existing values, of labour power and the means of production, into the new commodity and adds a surplus value to it. Value, then, is a social relation, which operates as an ‘invisible thread’ within the circulation of capital, which takes on different material forms as it circulates.
Value is initially defined as the cumulative ‘socially necessary labour time’—past and present labour—embodied in these new commodities. The surplus value arises because the labour power employed congeals more value in the commodity than is required to pay for the value of the labour power itself, which is fixed by the value of the commodities needed to reproduce the labourer at a given standard of living. The new commodity is then sold in the market, an operation that transforms value back into the money form. But there is now more money than at the beginning. ‘Profit’ is the money name and material representation of surplus value. Capitalists typically seek to maximize their amassed profit, either by raising the rate of exploitation of labour power or hiring more workers to increase production. The total value realized in money form is then distributed to the various factions that have claims upon it: to workers in the form of wages, to industrial producers as profits, to merchant capitalists as a monetary reward for facilitating sales, to bankers as interest on their loans, to landlords as rent and to the state as taxes. The capitalists, driven by competition, then reinvest to make more profit, and the process starts again. Repeated production of surplus value creates, however, a net accumulation of values in the form of compounding growth. The reproduction of capital becomes a never-ending spiral of endlessly expanding accumulation in space and time.
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