Thursday, 31 August 2017

Labour's Brexit Shift Is A Step Forward

The decision of Labour's leadership to shift its position on Brexit, so as to support staying in the Single Market and Customs Union, for a provisional period, after 2019, is a step forward. The previous position was untenable. Every time a Labour spokesperson appeared before the media, it made them look either incompetent, uncertain,or dissembling, because it meant arguing two irreconcilably opposed positions, based upon the the Government's ludicrous approach of seeking to have cake and eat it. Moreover, try as Labour might to deny it, it was clear that Labour's position, in practice, was no different to that of the soft-Brexit Tories, which itself is untenable. However, all that the shift in position has done is to highlight how untenable the previous position was. It merely avoids the awkward questions that position raised in the immediate situation, only to defer them to a few years down the road.

Arguing for remaining in the Single Market and Customs Union, for now, avoids the contradictions that arise over the Irish border, citizens rights, free movement and so on, and the disastrous effects on the economy that a cliff edge split with the EU will bring with it. But, all of those questions still exist, if Labour continues to argue for withdrawal from the Single Market and Customs Union at some future point. Yes, theoretically, if Labour were to argue for becoming a member of the EEA or EFTA, some of those contradictions could be removed, but that ignores the fact that whilst such solutions might be workable for small countries like Norway or Switzerland, in practice, they are not solutions for Britain's larger economy.

Even politicians in Norway argue that its relation to the EU is not desirable. It means they are bound by EU obligations, decisions and laws, but with no input into forming those rules and obligations. But, for small countries like Norway and Switzerland, that may be a small price to pay for being able to obtain the benefits of membership of the single market or customs union. For Britain, it's clear that whilst it is a small fish compared to the whole EU, or to economies like the US, or China, it is big enough not to be prepared to play such a back seat role as a Norway or Switzerland. The current UK-EU negotiations have made that clear, as Barnier talked about Britain's stance reflecting a kind of nostalgia, of wanting to enjoy all the rights of EU membership, in framing rules and regulations, but without being a member of the club. In other words, it is an expression of the arrogant British stance of seeking to have cake and eat it. There is no way the EU will accept such a stance, and those Brexiters who continue to think otherwise are simply deluded, and are misleading the British people, as they did during the referendum campaign itself.

Labour's change of stance has already had an effect on the Tories. It is probably why May has come out to more firmly announce her intention of staying and fighting the next election, and why the hard Brexiters have rallied around her. The fact is that now, the Tory Remainers, and soft Brexiters have a flag to rally around. Its only a pity that Labour had not provided it during the parliamentary debates over Article 50. The other consequence of that, however, is that it looks like the hard right in the Tory Party are angling to create an excuse to break off talks with the EU, as UKIP had been advocating.  That will require a determined struggle in Parliament, and probably the need for another General Election.  The shift of stance is also welcome because had Labour continued to appear merely as a pale reflection of the Tories on Brexit, the chance was that many of those younger voters who flocked to Labour as the only hope of resisting hard Brexit, would begin to splinter away.

The shift in stance means that the support of those younger voters and all those that went further and joined the party, can be consolidated, and the chance of fake left parties such as the Greens, Liberals, Plaid and SNP acting as a pole of attraction is cut off. But, that only applies for so long, and the current shift in stance is only a stop-gap, in that respect. Moreover, Labour's stance is back to front. It argues that it will accept free movement, as a part of remaining in the single market, but the starting point ought to be arguing positively for free movement. It is free movement that is the basic element of promoting workers rights, whilst it is the elements of the free market ideology of the Single Market, that undermines workers rights and interests that Labour should be seeking to change along with socialists and social-democrats across the EU.

And a recent poll suggested that even amongst Leave voters, the principle of free movement has majority support, as a recent Left Foot Forward post illustrated.

Labour's stance has so far continued to be framed in those old Blair-right terms of what is good for business as being the basis of what is then good for workers. Yet, even in those terms, what the free market policies that underpinned the EU really represented was not the interests of capital per se, of large-scale socialised capital, but only the interests of the owners of fictitious capital, of share and bondholders. Its foundations framed by people like Thatcher, and other European conservatives in the 1980's, reflected the interests of that fictitious capital, in contrast to the original foundations of the Common Market, based upon extending social-democratic principles of planning and regulation, as the basis of the accumulation of real productive-capital.

What Labour, merely as a progressive social-democratic party needs to get back to is the advocacy of those same principles of longer-term planning and regulation, as the basis for creating the stable conditions under which capital accumulation can proceed across the EU. It needs to get back to the ideas that underpinned the EU's Draft Fifth Directive on Company Law, that proposed establishing the same kind of co-determination of companies by having 50% of company boards made up of elected worker representatives, as already exists in Germany. And that requires also not a breaking up of the EU, but its further integration, and the harmonising of taxes, benefits, minimum wages and so on within its borders. It requires a more rapid development of a Federal United States of Europe, as the minimum basis upon which the struggle for a Workers' Europe can be undertaken.

And that same approach also needs to be taken inside Britain itself. Blair pushed forward the devolution agenda for typically Blair-right reasons. Blair's politics was based entirely upon electoralism, as a form of populism, and the tailing of public opinion. It saw a party's politics as being merely a commodity to be sold to voters, like washing powder, simply packaged up in a fashion that its market research told it would be most effective. Every policy, if such it could be called was merely a consequence of a process of triangulation to maximise votes from different segments of the electorate, in the same way that advertisers seek to maximise sales by stratified marketing.

The various focus groups told the Blair-rights that Scots voters wanted something different to what English voters wanted, particularly those English voters in the South-East that Blair was desperate to win away from the Tories. A single Labour message across the whole of Britain thereby threatened to retain Labour's core vote, whilst alienating some of the English “middle ground”. Devolution meant that a different Labour message could be sent out in Scotland to England, and that, it was intended, would be the way of undermining the SNP, and maximising the Scottish Labour vote. In fact, it inevitably had the opposite effect. It meant the nationalists could continue to blame Westminster for all the ills of Scotland, whilst taking credit themselves for any success. It meant that politics in Scotland was increasingly fragmented along nationalist and loyalist lines rather than class lines, not yet as clear-cut as in Northern Ireland, but moving in that same direction.

Indeed, the logical extension of that has been seen more recently, where that trend has infected the Labour Movement, and Labour Party itself with increasing calls for the Scottish Labour Party to separate itself from the Labour Party in the rest of Britain, much as the SDLP in Northern Ireland exists as an independent party, and the logical extension of that is for the Scottish TUC and Scottish trades unions to separate themselves from their English brothers and sisters, much as is the case with the Northern Irish trades unions. Wherever, these vertical cleavages in society are allowed to become more decisive, or where they are by the history and nature of the society, already more decisive (for example, in Northern Ireland, but the same kind of cleavages exist in a more exaggerated form in places like Iraq, Syria Egypt etc.) they undermine the organisation of politics on class lines. They encourage the formation of cross-class alliances that always weaken the position of workers, and subordinate their interests to those of the respective national bourgeoisie.

Indeed, the same thing could be seen over Brexit itself. Much as Corbyn and others sought to fight the referendum on the basis of the shared interests of workers across Europe, the media were only interested in framing the discussion around a binary choice of the interests of Britain v the interests of the EU. And, when it came to the Scottish referendum that same binary choice was what was on offer. Labour's disastrous Scottish referendum stance was to become good English Nationalists, arguing the case for the union, as it stood, as a capitalist union.

With Kezia Dugdale standing down as Labour Leader in Scotland, the opportunity opens up for a different approach. The approach throughout the UK should be the same as our approach to Europe. We start from the position of what is in the interests of the global working-class. That is why we support the right of free movement, irrespective of whether Britain is in or out of the EU; we start from the position that the minimum practical unit in which to pursue even progressive social-democratic policies is that of the EU. The reason to advocate staying in the EU is not because it would be good for Britain, or good for British business, but because it is the best basis upon which to forge workers unity and class solidarity across the continent, and thereby to undertake the political struggle for workers' interests.

And, the same is true in relation to Scotland, as socialists we argue against Scottish independence not because we are English nationalists, or because such union is good for British business, but because nationalism is a diversionary dead-end, and distracts from the need to build ever closer unity in action of workers throughout Britain, and beyond to ever closer unity in action with workers across Europe.

Theories of Surplus Value, Part II, Chapter 8 - Part 3

Marx repeats a point made in his discussion of rent in Capital III, which may be historically accurate, but which I'm not sure is theoretically valid. He writes,

“Quite apart from the variation in rent according to the fertility of the land, the very existence of rent—i.e., the modern form of landed property—is feasible because the average wage of the agricultural labourer is below that of the industrial worker. Since, to start with, by tradition (as the farmer turns capitalist before capitalists turn farmers) the capitalist passed on part of his gain to the landlord, he compensated himself by forcing wages down below their level. With the labourers’ desertion of the land, wages had to rise and they did rise. But hardly has this pressure become evident, when machinery etc. is introduced and the land once more boasts a (relative) surplus population. (Vide England.)” (p 17)

There is no doubt that capitalist farmers sought to compensate for the payment of rent by reducing wages below the value of labour-power, but the same can be said about the less efficient capitalist producers in general, who seek to compensate for their lower profits, arising from that inefficiency, by paying lower wages, and imposing poorer conditions.

Marx also describes the response to that in agriculture, with the movement off the land into the towns, and consequent rise in agricultural wages. Again, yes, historically, the response over time was to introduce labour-saving machines, which recreated a relative surplus population on the land, but its not clear how this is different to the position labour faces in general, when such new technology is introduced to remedy a relative shortage of labour. Marx's argument, related to this, in Capital III, was that it reflects the fact that productivity in agriculture is always lower than in industry, but it is not clear that this must always be the case or that the basis of rent would disappear if it were not the case.

The basis of Marx's argument is that the difference between agriculture and industry is that increased surplus value in industry arises from cheaper production, whereas in agriculture it arises from more expensive production. Marx sets out the situation in industry. But, his argument is rather lax.

He takes the price of production of yarn, and then examines the situation of a producer that produces with a lower individual value, due to the use of fixed capital, which allows more efficient production, on a larger scale. So, if the price of production of 1 kg. of yarn is £2, this producer may be able to produce it at £1, including the average profit. Because this lower cost is the result of producing on a larger scale, say 10,000 kg. rather than 8,000 kg., this represents increased supply of 2,000 kg., a place for which must be found on the market.

Marx makes a slight error, because he says that the lower cost is only achieved because the fixed capital cost is spread over this larger output, so that if only 8,000 kg. were sold, the price would be 20% higher. In fact, of course, the fixed capital raises productivity so that also the cost of wages in each kg. of output falls.

In order to sell this 10,000 kg., therefore, the producer reduces the selling price, so as to create additional demand. However, in reality, it depends on the relative proportion of total output which this producer accounts for. If the total production of yarn is say 1 million kg., the additional 2,000 kg., of this producer, will not be significant. They would, in reality, continue to sell their output at the existing price of production of £2 per kg., making £1 per kg. of surplus profit.

But, Marx assumes that this 10,000 kg. is sufficient to require the producer to reduce their price so as to sell it. If they reduce their price to £1.50 to do so, this will be below the previous market price and price of production, but above the individual value/price of production for this 10,000 kg. thereby still providing a surplus profit of £0.50 per kg.

Marx does not pursue the ramifications of the argument, however, For example, if this 10,000 kg. represents a significantly large proportion of total output as to require a fall in the market price of yarn, to create the demand to absorb the additional supply, it must also be large enough to also affect the market value/price of production of yarn itself. It is not just this producer alone who then must sell at £1.50 per kilo, but all other producers of yarn. But, other yarn producers may produce with a price of production equal to the previous level of £2 per kg. which means that they now make profit below the average, to the extent of £0.50 per kg. Others may produce at prices of production even above the old level who now see their profit disappear, leading them to withdraw their capital.

Turning to the situation in agriculture, Marx argues that the supplier would sell, not at £1.50 per kg., but at £2 per kg, because “... if I had sufficient fertile land, the less fertile would not be cultivated.” (p 18)

But, if we assume no change in demand, in both cases, that is what would happen. In the case of industry, some of those businesses that produced at costs of production above the new price of production, of £1.50 per kg., would cease production, reducing supply. If the supply of corn rises by 2,000 kg., because some new technique raises productivity, this additional 2,000 kg. of supply can only be absorbed by the market if demand rises, and assuming no change in the demand conditions for corn, that can only happen if the market price of corn falls accordingly.

Wednesday, 30 August 2017

Theories of Surplus Value, Part II, Chapter 8 - Part 2

This difference in productivity, therefore, can only be compensated by absolute surplus value, i.e. by increases in the length or intensity of the working-day, within fairly narrow limits. If the labour-time required for the reproduction of labour-power is six hours, then the rate of surplus value, of 100%, with a twelve hour working day, can be increased to 200% with an eighteen hour working day, but its unlikely to be able to extend it beyond that.

If there are one million workers, so that the necessary social working day is six million hours, then, with this eighteen hour day, eighteen million hours of value is produced, giving twelve million hours of surplus value. If the number of workers doubles, the total amount of surplus value also doubles to twenty-four million hours, but the rate of surplus value is not changed. But, this is not the case with relative surplus value. If social productivity rises, then its possible that the needs of this working population of two million may still be met by the expenditure of six million hours of labour, but in an eighteen hour day, these two million workers produce thirty-six million hours of value, so that surplus value is now thirty million hours, giving a rate of surplus value of five hundred percent, with a consequent increase in the rate of profit.

Its possible that instead of a reduction in the value of labour-power arising from rising social productivity, a similar effect may be achieved by reducing wages below the value of labour-power, but, over the longer term, this will reduce the supply of labour-power, for a variety of reasons. Workers may leave the country, have smaller families, or be incapable of working for the same length and intensity. They will not develop the same level of skill, education and so on, so that even if the same quantity of concrete labour is undertaken, it will represent a smaller quantity of abstract labour.

Marx repeats the point made in Capital I, in response to Carey.

“In any case because in a given country the value of labour is falling relatively to its productivity, it must not be imagined that wages in different countries are inversely proportional to the productivity of labour. In fact exactly the opposite is the case. The more productive one country is relative to another in the world market, the higher will be its wages as compared with the other. In England, not only nominal wages but [also] real wages are higher than on the continent. The worker eats more meat; he satisfies more needs.” (p 16-17)

Yet, as was indicated earlier, these higher wages go along also with higher profits, and a higher rate of profit, because although these wages are higher than wages in other countries, they are not higher as a proportion of the total value of production.

“But in proportion to the productivity of the English workers their wages are not higher (than the wages paid in other countries].” (p 17)

Tuesday, 29 August 2017

Theories of Surplus Value, Part II, Index

Capital ICapital IICapital III,

Theories of Surplus Value Part I, Part II

Chapter 8 - Herr Rodbertus. New Theory of Rent. (Digression)

Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8, Part 9, Part 10, Part 11, Part 12, Part 13, Part 14, Part 15, Part 16, Part 17, Part 18, Part 19, Part 20, Part 21, Part , Part 23, Part 24, Part 25, Part 26, Part 27, Part 28, Part 29, Part 30, Part 31, Part 32, Part 33, Part 34, Part 35, Part 36, Part 37, Part 38, Part 39, Part 40, Part 41, Part 42, Part 43, Part 44, Part 45, Part 46, Part 47, Part 48, Part 49, Part 50, Part 51, Part 52, Part 53, Part 54

Theories of Surplus Value, Part II, Chapter 8 - Part 1

[CHAPTER VIII] Herr Rodbertus. New Theory of Rent. (Digression)


[1. Excess Surplus-Value in Agriculture. Agriculture Develops Slower Than Industry under Conditions of Capitalism]


In this chapter, Marx examines the theory of rent presented by Rodbertus. He begins with a short restatement of the basis of surplus value. A producer requires the expenditure of a certain amount of labour-time to produce the products required for the reproduction of their labour-power. That is the value of their labour-power. But, the value of the product of their labour is equal to the total amount of labour-time they expend. The difference between this total labour-time expended and the value of their labour-power is the amount of surplus value produced.

Where the producer is producing commodities rather than just products for their own consumption, this situation continues, but appears in a different form. The necessary labour undertaken by the producer now appears as a quantity of commodities which they exchange for the commodities required for their own consumption, or for an amount of money, the general commodity, which can be used to buy these commodities.

Under these conditions, it is then not just the productivity of the individual producer, which determines how much labour-time constitutes necessary labour, and how much surplus labour, but social productivity. If general social productivity rises, so that less labour-time is required to produce the commodities required to reproduce labour-power, the producer will have to exchange fewer of their own commodities to obtain them, leaving a greater proportion of their labour-time available as surplus labour-time and surplus value.

“Herr Rodbertus first investigates the situation in a country where there is no separation between land ownership and owner-ship of capital. And here he comes to the important conclusion that rent (by which he means the entire surplus-value) is simply equal to the unpaid labour or the quantity of products which it represents.” (p 15-16) 

Rodbertus only takes account of the growth of this relative surplus-value, as rising social productivity reduces the value of labour-power. Marx makes the point also made previously in Capital III, that all surplus value is relative, in the sense that it requires social productivity to have risen to a level where the worker does not need to spend all their time simply reproducing their labour-power.

Higher rates of profit, therefore, generally go along with higher levels of social productivity, which reduce the value of labour-power, and raise relative surplus value. Higher rates of profit usually only accompany lower levels of productivity under specific and unusual conditions.

“The relative productivity of labour necessary before a profit-monger, a parasite, can come, into being is very small. If we find a high rate of profit though labour is as yet very unproductive, and machinery, division of labour etc., are not used, then this is the case only under the following circumstances; either as in India, partly because the requirements of the worker are extremely small and he is depressed even below his modest needs, but partly also because low productivity of labour is identical with a relatively small fixed capital in proportion to the share of capital which is spent on wages or, and this comes to the same thing, with a relatively high proportion of capital laid out in wages in relation to the total capital; or finally, because labour-time is excessively long.” (p 16)

Even here, this higher rate of profit is only possible in so far as the prices of commodities remain locally, rather than globally determined. Alongside the small fixed capital goes the low level of productivity, which gives rise to the large quantity of labour, and high proportion of wages. Where this relates, for example, to textile production, in India, by small handicraft producers, and the market value is determined only in India, then a high rate of profit may result, especially as the high level of nominal wages, as a proportion of the total cost, may still represent a low level of real wages. But, as soon as these Indian textiles have to compete in the market against mass produced textiles from Britain, produced by very productive workers, using large amounts of fixed capital, the value of the Indian textiles itself collapses, and along with it the surplus value and rate of profit.

“The latter is the case in countries (such as Austria etc.) where the capitalist mode of production is already in existence but which have to compete with far more developed countries. Wages can be low here partly because the requirements of the worker are less developed, partly because agricultural products are cheaper or—this amounts to the same thing as far as the capitalist is concerned—because they have less value in terms of money. Hence the quantity of the product of, say, 10 hours’ labour, which must go to the worker as necessary wages, is small. If, however, he works 17 hours instead of 12 then this can make up (for the low productivity of labour].” (p 16)

In Capital I, Marx makes precisely this point that wages in Austria, Belgium and other parts of Europe were 50% below those in Britain, and working conditions were similarly poorer, Yet, these countries still could not compete with British industrial production, due to its higher level of productivity.

Monday, 28 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 30

[(I) The Problem of Productive Labour from the Standpoint of the Total Process of Material Production]


“With the development of the specifically capitalist mode of production, in which many labourers work together in the production of the same commodity, the direct relation which their labour bears to the object produced naturally varies greatly. For example the unskilled labourers in a factory referred to earlier have nothing directly to do with the working up of the raw material. The workmen who function as overseers of those directly engaged in working up the raw material are one step further away; the works engineer has yet another relation and in the main works only with his brain, and so on. But the totality of these labourers, who possess labour-power of different value (although all the employed maintain much the same level) produce the result, which, considered as the result of the labour-process pure and simple, is expressed in a commodity or material product; and all together, as a workshop, they are the living production machine of these products—just as, taking the production process as a whole, they exchange their labour for capital and reproduce the capitalists’ money as capital, that is to say, as value producing surplus-value, as self-expanding value.” (p 411)

As stated earlier, this is most apparent in the case of socialised capital, and particularly in respect of the worker owned co-operative. The division of labour not only divides various tasks into their component parts, but it also divides mental from manual labour.

“This however does not prevent the material product from being the common product of these persons, or their common product embodied in material wealth; any more than on the other hand it prevents or in any way alters the relation of each one of these persons to capital being that of wage-labourer and in this pre-eminent sense being that of a productive labourer. All these persons are not only directly engaged in the production of material wealth, but they exchange their labour directly for money as capital, and consequently directly reproduce, in addition to their wages, a surplus-value for the capitalist, Their labour consists of paid labour plus unpaid surplus-labour.” (p 412)

[(J) The Transport Industry as a Branch of Material Production. Productive Labour in the Transport Industry]


Marx finally examines transport. Transport is like a service in that the production and consumption cannot be separated, whether it is goods or people who are to be transported. The service is consumed simultaneously with it being produced.

This has no bearing upon whether the labour employed is productive or unproductive, which again depends upon whether it exchanges with capital or revenue. It is an issue that arises with Uber, i.e. are the drivers owners of their own means of production, and so neither productive nor unproductive labourers, or else wage workers employed by capital, and so productive labourers.

As I have set out in relation to Marx’s discussion of transport, in Capital II, I believe Marx's argument is wrong. He argues that by changing the geographical location of a commodity, transport changes its use value, and thereby adds to its value.

“When the commodity has reached its destination, this change which has taken place in its use-value has vanished, and is now only expressed in its higher exchange-value, in the enhanced price of the commodity. And although in this case the real labour has left no trace behind it in the use-value, it is nevertheless realised in the exchange-value of this material product; and so it is true also of this industry as of other spheres of material production that the labour incorporates itself in the commodity, even though it has left no visible trace in the use-value of the commodity.” (p 413)

I think this is wrong. I think that the consumer buys two commodities – the commodity itself and its transportation. This is highlighted by the fact that the sellers of commodities themselves often present the matter in that way, listing the price of the commodity, applicable wherever the buyer might be, plus a separate charge for delivery.

If I go to watch a football match at Wembley, I pay the same price to buy that commodity, wherever I live. The fact that I pay a train fare, if I live in Stoke, in order to consume this commodity, does not change, in any way, the use value of the football match, or its value. I have simply consumed another commodity – rail travel, in addition to the football match.


Sunday, 27 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 29

[(G) Supplementary Definition of Productive Labour as Labour which is Realised in Material Wealth]

“In considering the essential relations of capitalist production it can therefore be assumed that the entire world of commodities, all spheres of material production—the production of material wealth—are (formally or really) subordinated to the capitalist mode of production - for this is what is happening more and more completely; [since it] is the principal goal, and only if it is realised will the productive powers of labour be developed to their highest point. On this premise—which expresses the limit [of the process] and which is therefore constantly coming closer to an exact presentation of reality—all labourers engaged in the production of commodities are wage-labourers, and the means of production in all these spheres confront them as capital. It can then be said to be a characteristic of productive labourers, that is, labourers producing capital, that their labour realises itself in commodities, in material wealth. And so productive labour, along with its determining characteristic—which takes no account whatever of the content of labour and is entirely independent of that content—would be given a second, different and subsidiary definition.” (p 409-10)

But, as discussed earlier, capitalist production has moved on considerably in the 150 years since Marx wrote that. Marx refers to the capitalist production of services in his time being an exception, but today service industries account for more than 80% of output in all developed economies.

“Non-material production, even when it is carried on purely for exchange, that is, when it produces commodities, may be of two kinds:” (p 410)

Firstly, it can result in an actual commodity, such as a book, painting and so on. Marx comments,

“Here capitalist production is applicable only to a very restricted extent: as for example when a writer of a joint work—say an encyclopaedia—exploits a number of others as hacks. In this sphere for the most part a transitional form to capitalist production remains in existence, in which the various scientific or artistic producers, handicraftsmen or experts work for the collective trading capital of the book-trade—a relation that has nothing to do with the capitalist mode of production proper and even formally has not yet been brought under its sway. The fact that the exploitation of labour is at its highest precisely in these transitional forms in no way alters the case.” (p 410)

But, again, today that is not the case. The modern equivalents of the examples that Marx gives, are the film, TV, and video production industries, computer games production and so on, and these are vast and very profitable industries, in which a lot of the labour employed is highly complex and highly paid.

The second is where the commodity is a service the consumption of which cannot be separated from its production. The examples Marx gives here are the performances of a singer or actor, or the work of a teacher. Again Marx notes,

“Here too the capitalist mode of production is met with only to a small extent, and from the nature of the case can only be applied in a few spheres. For example, teachers in educational establishments may be mere wage-labourers for the entrepreneur of the establishment; many such educational factories exist in England. Although in relation to the pupils these teachers are not productive labourers, they are productive labourers in relation to their employer. He exchanges his capital for their labour-power, and enriches himself through this process. It is the same with enterprises such as theatres, places of entertainment, etc. In such cases the actor’s relation to the public is that of an artist, but in relation to his employer he is a productive labourer. All these manifestations of capitalist production in this sphere are so insignificant compared with the totality of production that they can be left entirely out of account.” (p 411)

But they certainly cannot be left out of account today. Besides the fact that many of the commodities of this second kind can now be transformed into those of the first kind, because a performance, a lecture, or a football match etc. can be recorded, as well as instantaneously transmitted across the globe, even the live performance of these activities has been transformed into mammoth industries.

Live performances of singers, actors, sports people and so on are now multi-billion dollar events. The “educational factories” that Marx describes in his day appear as mere workshops compared to the mammoth Fordist education factories that capital has established as part of the welfare state, and the same is true of the health and social care factories. The same is true with the provision of environmental health services and so on, all produced by a huge army of wage labourers, exchanging their labour with capital.

Back To Part 28

Forward To Part 30

Saturday, 26 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 28

In the case of a joint stock company, the money-capital is loaned by shareholders, who likewise are entitled to interest on their loan, in the form of dividends. But, in both cases, the productive-capital is collectively owned by the firm, i.e. the associated producers, not the shareholders, and the profit is likewise the property of the associated producers, not the shareholders. The dividends paid to the shareholders represent a deduction of interest from those profits.

“The determinate social character of the means of production in capitalist production—expressing a particular production relation —has so grown together with, and in the mode of thought of bourgeois society is so inseparable from, the material existence of these means of production as means of production, that the same determinateness (categorical determinateness) is assumed even where the relation is in direct contradiction to it. The means of production become capital only in so far as they have become separated from labourer and confront labour as an independent power. But in the case referred to the producer—the labourer— is the possessor, the owner, of his means of production. They are therefore not capital, any more than in relation to them he is a wage-labourer. Nevertheless they are looked on as capital, and he himself is split in two, so that he, as capitalist, employs himself as wage-labourer.” (p 408)

That is not only clear in relation to the peasant producer, or the self-employed, but is also clearly the case in relation to the worker-owned co-operative, as Marx sets out in Capital III, Chapter 27.

“The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour.”

Marx points out that this way of presenting the matter, of the owner of the means of production owning their own capital is “irrational”, and yet, “... is nevertheless so far correct, that in this case the producer in fact creates his own surplus-value commodity at its value>, in other words, only his own labour is materialised in the whole product. But that he is able to appropriate for himself the whole product of his own labour, and that the excess of the value of his product over the average price for instance of his day’s labour is not appropriated by a third person, a master, he owes not to his labour —which does not distinguish him from other labourers —but to his ownership of the means of production. It is therefore only through his ownership of these that he takes possession of his own surplus-labour, and thus bears to himself as wage-labourer the relation of being his own capitalist.” (p 409)

This is true also in relation to the socialised capital of the joint stock company. The surplus value belongs to its associated producers collectively, not to the shareholders. The shareholders are entitled only to the average rate of interest on their loaned money-capital. That the power of these shareholders, and their representatives on company boards, obtain returns in excess of this, at some times, does not invalidate the underlying economic relation.

It is why there are increasing demands to limit the undue influence of these shareholders, for example, to legislate for elected worker directors on company boards, as in Germany, and as proposed in the EU's Draft Fifth Company Law Directive. It was also reflected in the comments, in July 2015, by Bank of England economist, Andy Haldane, complaining about “capitalism eating itself”, as well as in comments, at the same time, by Hillary Clinton, complaining about the problems caused by “Quarterly Capitalism”. Both reflected the concerns of this socialised productive capital against the interests of fictitious capital, which resulted in excessive amounts of profits going as revenue to shareholders rather than being used for productive investment.

Separation appears as the normal relation in this society. Where therefore it does not in fact apply, it is presumed and, as has just been shown, so far correctly; for (as distinct for example from conditions in Ancient Rome or Norway or in the north-west of the United States) in this society unity appears as accidental, separation as normal; and consequently separation is maintained as the relation even when one person unites the separate functions.” (p 409)

And Marx could also have said when one corporate person, as in the case of a co-operative or joint stock company unites the functions.

“Here emerges in a very striking way the fact that the capitalist as such is only a function of capital, the labourer a function of labour-power.” (p 409)

The individual peasant or handicraft producer was bound either to turn themselves into capitalist producers, or else to be turned into wage labourers themselves. But, similarly, as Marx sets out in Capital I, Chapter 25, and in Capital III, Chapter 27, even the largest private capitalists were to represent a fetter on further capitalist development, and were themselves to be expropriated by socialised capital in the form of the co-operatives and joint stock companies.

Northern Soul Classics - Because Of You - Jackie Wilson

Friday, 25 August 2017

Friday Night Disco - Trouble In Paradise - Al Jarreau

Theories of Surplus Value, Part I, Chapter 7 - Part 27

[(F) The Labour of Handicraftsmen and Peasants in Capitalist Society]


Marx then examines the production of non-capitalist producers, such as handicrafts-men and peasants within a capitalist society. The basic fact here is that the term productive or unproductive labour does not apply, precisely because it is not capitalist production. The term productive labour means productive of capital, labour that exchanges with capital, produces surplus value, and thereby reproduces capital.

But, non-capitalist production, by definition does not employ capital and so the labour does not exchange with capital, and does not reproduce capital. It is not that the labour is unproductive, but that the terms productive and unproductive do not apply to such labour. The peasant or independent handicraft worker produces commodities, which they bring to market.

“In this capacity they confront me as sellers of commodities, not as sellers of labour, and this relation therefore has nothing to do with the exchange of capital for labour; therefore also it has nothing to do with the distinction between productive and unproductive labour, which depends entirely on whether the labour is exchanged for money or for money as money as capital. They therefore belong neither to the category of productive nor of unproductive labourers, although they are producers of commodities. But their production does not fall under the capitalist mode of production.” (p 407)

Such producers may produce a surplus value, as peasants did in the past, which was appropriated as rent by the feudal lord. That is in the sense that any labour they perform in excess of the necessary labour required for the reproduction of their labour-power represents a surplus value. As independent producers, they can appropriate this surplus value, less whatever is taken from them in rent, interest and taxes.

Marx does not deal here with the fact that this would also appear to be the case with the individual provider of services. A prostitute, for example, may need to work for four hours per day to earn enough to reproduce their labour-power, but if they work for six hours they will produce a surplus value of two hours, which they may appropriate for themselves.

“And here we come up against a peculiarity that is characteristic of a society in which one definite mode of production predominates, even though not all productive relations have been subordinated to it... 

The independent peasant or handicraftsman is cut up into two persons. As owner of the means of production he is capitalist; as labourer he is his own wage-labourer. As capitalist he therefore pays himself his wages and draws his profit on his capital; that is to say, he exploits himself as wage-labourer, and pays himself, in the surplus-value, the tribute that labour owes to capital. Perhaps he also pays himself a third portion as landowner (rent), in exactly the same way, as we shall see later, that the industrial capitalist, when he works with his own capital, pays himself interest, regarding this as something which he owes to himself not as industrial capitalist but qua capitalist pure and simple.” (p 408)

This represents the situation with those relics of former modes of production that continue into capitalist society, but the same thing applies also to those harbingers of the new mode of production that emerges out of capitalist production. With socialised capital, whether it is in the form of the co-operative or the joint stock company, the capital itself belongs to the company, i.e. to the associated producers themselves, just as with a peasant producer.

But, the company obtains the productive-capital by borrowing money-capital. In the case of a co-operative, the money-capital is loaned by its members, be they workers, in the case of a worker-owned co-operative, or consumers in a consumer co-operative. In either case, these members act as shareholders, entitled to interest, paid out of the profit.

Thursday, 24 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 26

Marx distinguishes between a commodity and a service on the basis that a commodity is a tangible product, whereas a service is intangible and inseparable from the labour that provides it. But, as described earlier, the labour that provides a service rather than produces a tangible commodity can just as easily be productive of surplus value. At the time Marx was writing, it was more likely that services were provided by unproductive labour, but that is not the case today.

“These services themselves, like the commodities which I buy, may be necessary or may only seem necessary—for example, the service of a soldier or physician or lawyer; or they may be services which give me pleasure. But this makes no difference to their economic character. If I am healthy and do not need a doctor or am lucky enough not to have to be involved in a lawsuit, then I avoid paying out money for medical or legal services as I do the plague. 

Services may also be forced on me—the services of officials, etc.” (p 405)

This again demonstrates the point that labour cannot be designated as productive or unproductive from the perspective of the consumer. From the perspective of a consumer all those commodities required to reproduce or enhance their labour-power are productive, in that they enable them to be able to sell their labour-power. As Marx describes in the Grundrisse, this is an example of the way consumption is at the same time production, just as the labour-power produced by this consumption is at the same time consumed as it engages in production.

If the worker buys gin, however, this may not be necessary for the reproduction of their labour-power, certainly if consumed in excess, it may even be destructive of it. Yet, the worker who produces gin, in a distillery, would be a productive worker, whereas the tutor who provides education directly, as a service, would be an unproductive labourer.

“But the particular utility of this service alters nothing in the economic relation; it is not a relation in which I transform money into capital, or by which the supplier of this service, the teacher, transforms me into his capitalist, his master.” (p 405)

The ability to employ unproductive labour depends on revenue, and so the workers are the least able to employ unproductive labour. But, the employment of a larger number of unproductive labourers does not increase the ability to employ more productive labour. On the contrary, a capitalist who uses a large part of their profit as revenue, to employ domestic servants, thereby reduces the amount of their profit they can accumulate as capital, so as to employ productive labour.

“The first formal act of exchange between money and labour or capital and labour is only potentially the appropriation of someone else’s living labour by materialised labour. The actual process of appropriation takes place only in the actual production process, behind which lies as a past stage that first formal transaction—in which capitalist and labourer confront each other as mere owners of commodities, as buyer and seller. For which reason all vulgar economists—like Bastiat —go no further than that first formal transaction, precisely in order by this trick to get rid of the specific capitalist relation. The distinction is shown in a striking way by the exchange of money for unproductive labour. Here money and labour exchange with each other only as commodities. So that instead of this exchange forming capital, it is expenditure of revenue.” (p 407)

Back To Part 25

Forward To Part 27

Wednesday, 23 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 25

[(E) Unproductive Labour. As Labour which Performs Services; Purchase of Services under Conditions of Capitalism. Vulgar Conception of the Relation Between Capital and Labour as an Exchange of Services]


Labour cannot be defined as productive or unproductive on the basis of being one type of concrete labour as opposed to another. In the same way, it cannot be defined as productive or unproductive from the perspective of the buyer of the product of that labour.

If I employ a cook, I do not buy their labour-power as a commodity, but the service their labour provides in cooking my dinner. If this cook works for me in exchange for a payment for this service, their labour is unproductive. It creates no surplus value.

Suppose I buy the service of this same cook, however, who is employed by a catering company, or an employment agency who pay their wages. As far as I am concerned, there is no difference. I pay the same amount of money, and obtain the same service. The money I have spent is not capital, in either case. It is simply money used as means of circulation, the same as if I bought any other commodity for consumption.

However, in the second case, the labour of the cook is productive, because it exchanges with capital; not my capital, but the capital of the catering company or employment agency, which employed them, and pays their wages, with the express intention of producing a profit from doing so.

I may even pay less, in the second case, than in the first case, because the capitalist employer of this labour will have all of the advantages of capitalist production to reduce the cost of production that an individual worker does not possess. This is why the self-employed often end up paying themselves lower wages per hour than if they were selling their labour-power to a capitalist employer. 

“I buy the tailoring labour for the service it renders me as tailoring labour, in order to satisfy my need for clothing and consequently to serve one of my needs. The merchant-tailor buys it as a means to making two talers out of one. I buy it because it produces a particular use-value, renders me a particular service. He buys it because it produces more exchange-value than it costs, as a mere means for exchanging less labour for more labour. 

Where the direct exchange of money for labour takes place without the latter producing capital, where it is therefore not productive labour, it is bought as service, which in general is nothing but a term for the particular use-value which the labour provides, like any other commodity; it is however a specific term for the particular use-value of labour in so far as it does not render service in the form of a thing, but in the form of an activity, which however in no way distinguishes it for example from a machine, for instance a clock.” (p 403-4)

Anyone, including workers, can buy services provided directly by unproductive labour. It is simply the purchase of a commodity in exchange for money.

“The service which he buys may be more or less necessary —for example, the service of a physician or of a priest, just as he may buy either bread or gin. As buyer—that is, as representative of money confronting commodity—the labourer is in absolutely the same category as the capitalist where the latter appears only as buyer, that is to say, where there is no more in the transaction than the conversion of money into the form of commodity.” (p 404)

Back To Part 24

Forward To Part 26

Tuesday, 22 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 24

[(D) The Specific Use-value of Productive Labour for Capital]


The direct producer of commodities produces use values for their direct consumption or to be exchanged for money, which can be exchanged for other commodities required for their consumption. But, the capitalist produces for neither of these reasons. The purpose of their production is not to produce a use value that they can consume, nor to produce a commodity, which they can sell in order to consume. It is only to produce in order to create profit, and thereby to transform money into capital.

The means of achieving this is via the employment of labour-power. The result of the production process is that a greater quantity of labour is absorbed than was paid for. More labour is contained in the materialised product of this process than was contained in the means of production and labour-power that went into it.

The use value of the labour-power bought by capital, therefore, is not its specific use value, as a particular kind of concrete labour, but as the source of abstract labour, of labour as the essence of value. Capital exchanges with labour-power because this labour-power creates new value and thereby the potential for surplus value and an expansion of capital.

“Labour which is to produce commodities must be useful labour; it must produce a use-value, it must manifest itself in a use-value. And consequently only labour which manifests itself in commodities, that is, in use-values, is labour for which capital is exchanged. This is a self-evident premise. But it is not this concrete character of labour, its use-value as such—that it is for example tailoring labour, cobbling, spinning, weaving, etc.—which forms its specific use-value for capital and consequently stamps it as productive labour in the system of capitalist production. What forms its specific use-value for capital is not its specific useful character, any more than it is the particular useful properties of the product in which it is materialised.” (p 400)

In other words, capital is not exchanged with abstract labour. Abstract labour does not and cannot exist, as a form of labour-power that is sold as a commodity, precisely because it is abstract and not concrete labour. A capitalist does not go into the labour market and say “I'd like £100 of abstract labour please.” They go into the labour market wanting to employ £100 of dock labour, £100 of weaving labour and so on.

This must be the case, for the reason Marx sets out here, that although capital's objective is the production of surplus value, this surplus value is always embodied in some concrete use value, a particular type of commodity, which is produced by some specific, concrete labour. Concrete labour is the source of value, whilst abstract labour is the essence of value. As I have described previously, a candle or the Sun are both sources of light, but neither are the essence of light, which is comprised of the photons, which stream out from these different sources.

“For it [capital], the use-value of labour-power is precisely the excess of the quantity of labour which it performs over the quantity of labour which is materialised in the labour-power itself and hence is required to reproduce it. Naturally, it supplies this quantity of labour in the determinate form inherent in it as labour which has a particular utility, such as spinning labour; weaving labour, etc. But this concrete character, which is what enables it to take the form of a commodity, is not its specific use-value for capital. Its specific use-value for capital consists in its quantity as labour in general, and in the difference, the excess, of the quantity of labour which it performs over the quantity of labour which it costs.” (p 400)

Any concrete labour may be useful, in that it produces use values, but that does not make it productive. If I employ a cook, to provide my meals, the cook's labour is useful, it is embodied in my meals, and thereby has created new value. But, it is not productive. The money wages I pay the cook may appear to be in form exactly the same as the wages I pay to my productive workers, but they are not.

The wages I pay to my cook are not intended to act as variable-capital, to produce a profit. They are only intended to produce my dinner. At the end of this process, I have spent a certain amount of money buying commodities – food, energy for the cooker, - and employing a cook who supplies a certain amount of labour, and at the end of this process I have a product – my dinner – which has the same amount of value. No surplus value is produced. The cook's labour was useful, it created new value, but it was not productive, it created no surplus value, it did not exchange with capital.

“It follows from what has been said that the designation of labour as productive labour has absolutely nothing to do with the determinate content of the labour, its special utility, or the particular use-value in which it manifests itself.” (p 401)

Marx uses the example of Milton, who produced Paradise Lost and sold it for £5. His work, Marx says, was like the activity of the silk worm, simply a manifestation of his nature. It was not intended to produce a profit, and was not, therefore, 'productive'. Yet, the words churned out by writers employed by various publishing houses were productive because they were employed with the express intention of creating a profit.

“A singer who sells her song for her own account is an unproductive labourer. But the same singer commissioned by an entrepreneur to sing in order to make money for him is a productive labourer; for she produces capital.” (p 401) 

Marx also returns to this question in the next volume, in again examining Smith's two different theories of value. In particular, Marx sets out in relation to the prices paid for pebbles sold by poor Scottish pebble collectors to stone cutters, that Smith should have considered whether the pebbles were sold at or below their value. In effect, if the pebbles were sold below their value, the poor collectors were simply acting as wage labourers in a disguised form, and thereby providing a surplus value for the stone-cutters. It is rather like a worker paid on piece rates, where the price paid per piece is determined not on the basis of its value, but on the basis of a division of a day's wage. The same thing applies today with the supposedly self-employed Uber drivers, or other workers in the “gig economy”.

Monday, 21 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 23

[(C) Two Essentially Different Phases in the Exchange Between Capital and Labour]


There are two interdependent phases, in the exchange between capital and labour. In the first phase, there is the straightforward exchange of commodities, which takes place according to the laws of commodity exchange on the basis of equal values.

“From a conceptual or legal standpoint the sale of labour-power takes place in this first process, although the labour is paid for only after it has been performed—at the end of the day, of the week, etc.” (p 397) 

A commodity, labour-power, is exchanged by the worker, for an equal amount of value in money. But, what the worker sells is not some commodity already materialised in a product, but their power to perform labour, and thereby to create value.

“The wagethe value of the labour-power—appears, as explained earlier as the direct purchase price, the price of labour.” (p 397)

But, the only reason that the capitalist buys the commodity is that the labour they thereby obtain represents a greater value than the value they have advanced in the form of money to buy it. But, this appropriation of the additional value arises not as a consequence of this exchange, but only as a consequence of the subsequent consumption of the commodity bought.

In other words, when I buy £1 of food, I exchange £1 in value, in the form of money, and receive £1 in value, in the form of food. This exchange of values is an independent act from my subsequent consumption of the food. The two acts are of course interdependent, because I only buy the food because I intend to consume it, and I can only consume it, because I have bought it.

The same thing arises here. The capitalist only buys labour-power because they intend to consume it in the production process, and can only consume it, because they have bought it – even though they pay for it after it has been consumed. I buy food because I need to eat; the capitalist buys labour-power because they need to produce surplus value. But, the two acts exchange and consumption are separate.

What is different, however, is that when I consume the £1 of food; its use value disappears, whilst its value has been transferred to me. But, that is not the case with labour-power. The very act of its consumption, in the labour process results not only in the creation of new value able to replace the value of the labour-power, consumed, but an additional surplus value too. Where when I consume food I consume and thereby destroy the original use value, incorporating that use value into my body, and transferring its value to me, the use value of labour-power is not transferred to its product, and nor is its value.

That was part of the mistake of Adam Smith, who saw the value of commodities, in some versions of his theory of value, being resolved in the value of the labour-power. But, the value of labour-power used in the production of a commodity is not transferred to the value of the commodity in the way that the value of constant capital is transferred.

Labour-power is consumed in the production process, and in that process, the use value and value of labour-power is consumed, and disappears. But, alongside this process of consuming labour-power, is the very act of creating new value. Labour-power, with a value of £100 is consumed, in the production process. It is destroyed and disappears in that process. But, in that process labour is expended and creates new value to the amount of £120. This new value created in the production process is thereby enabled to reproduce the £100 of value of the labour-power consumed, and to produce a surplus value of £20, but this value of £120 is in no sense contingent upon the original £100 value of the labour-power. That £100 value is not transferred, in any way, to the commodity produced in this process. It would be all the same if labour-power with a value of £120 were employed in the production process, and yet, as a result of a fall in productivity, the value produced by this labour-power, created only £100 of new value. In that case, instead of creating a surplus value of £20, it would produce a loss of £20.

“In this process, therefore, labour is directly materialised, is transformed directly into capital, after it has been formally incorporated in capital through the first transaction. And indeed more labour is here transformed into capital than the capital which had earlier been expended on the purchase of labour-power. In this process a part of unpaid labour is appropriated, and only thereby does the money transform itself into capital.” (p 398)

The basic reality here is that a given value of materialised labour, embodied in the means of production and means of subsistence (c + v) is now materialised in commodities representing a greater sum of value (c + v + s).

It is this process which results in the productive labour, i.e. labour which is directly exchanged with capital, creating surplus value, and which thereby creates capital.

“This statement covers: (1) the relation of money and labour-power to each other as commodities, purchase and sale as between the owner of money and the owner of labour-power; (2) the direct subsumption of labour under capital; (3) the real transformation of labour into capital in the production process, or what is the same thing, the creation of surplus-value for capital. Two kinds of exchange take place between labour and capital. The first expresses merely the purchase of labour-power and therefore in reality of labour and therefore of its product; the second, the direct transformation of living labour into capital, in other words the materialisation of living labour as the realisation of capital.” (p 399)

Back To Part 22

Forward To Part 24

Sunday, 20 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 22

Money becomes capital, as the money is used to buy means of production and labour-power. But, it is not this purchase that turns the money into capital. In fact, the money itself is not directly turned into capital. The money buys means of production and labour-power, and it is only in this form, via the production process, that the living labour itself is transformed into capital. That is this living labour as a materialisation of a given quantity of value, of social labour-time, becomes transformed by the labour process into a greater quantity of value. What was a fixed amount of value, becomes a variable quantity of value dependent upon the extent of labour performed.

It is only because this living labour itself thereby becomes capital, variable-capital, that a surplus value is produced, and that its monetary equivalent thereby expands.

“In the actual production process the living labour is transformed into capital through the fact that on the one hand it reproduces the wages —that is, the value of the variable capital —and on the other hand it creates surplus-value; and through this process of transformation the whole sum of money is transformed into capital, although the part of it which varies directly is only the part expended in wages.” (p 395)

Marx makes special note of this fact that although it is only the variable capital which produces the surplus value, it represents an expansion of the whole capital – c + v. This is important because it is the basis of the rate of profit, and for capitalist production, where prices of production rule, those prices are based on this expansion of the whole capital, i.e. the cost of production, c + v, plus the average profit, p.

“Moreover the transformation of v into v+x, and therefore of (c+v) into (c+v)+x, could only take place through the transformation of a part of the money into c, The one part can only be transformed into variable capital through the other part being transformed into constant capital.” (p 395)

This indeed is the specific difference between surplus value and profit that Smith and Ricardo did not understand, and which leads Ricardo into numerous problems in relation to understanding why the market value, or natural price of commodities is not equal to their price of production, as will be seen in the next volume.

Marx emphasises this point that it is only in the production process that the means of production and labour-power become capital, and, therefore, that the money which bought those commodities can be considered, in retrospect, to have been consumed as capital.

“Up to that point, the money—whether it exists in its own form or in the form of commodities (products) of a kind that can serve as means of production of new commodities —is only an sich capital.” (p 395)

The capital – be it money or commodities in the form of means of production and subsistence – which confronts the worker, is only capital in so far as it is used as capital, and engages in this production process, but it is nevertheless capital in essence. The capitalist only confronts the worker with the potential capital, because it is their intention to use it as capital, i.e. to engage in production for the purpose of creating a profit.

“They are in their essence capital because of the independent form in which they confront labour-power and labour-power confronts them—a relationship which conditions and ensures the exchange with labour-power and the subsequent process of the actual transformation of labour into capital. They have from the outset the specific social character in relation to the labourers which makes them into capital and gives them command over labour. They are therefore pre-conditions confronting labour as capital.” (p 396)

Labour is productive, therefore, only where it exchanges with capital.

Productive labour is therefore labour which reproduces for the labourer only the previously determined value of his labour-power, but as an activity creating value increases the value of capital; in other words, which confronts the labourer himself with the values it has created in the form of capital.” (p 397)

Saturday, 19 August 2017

Theories of Surplus Value, Part I, Chapter 7 - Part 21

[(B) Productive Labour in the System of Capitalist Production]


“Only bourgeois narrow-mindedness, which regards the capitalist forms of production as absolute forms—hence as eternal, natural forms of production—can confuse the question of what is productive labour from the standpoint of capital with the question of what labour is productive in general, or what is productive labour in general; and consequently fancy itself very wise in giving the answer that all labour which produces anything at all, which has any kind of result, is by that very fact productive labour.” (p 393)

Taken in general, all labour that creates products, use values that someone wants, is absolutely productive, i.e. it produces value. But, as Marx says in Chapter 4, productive labour is based upon relative not absolute productivity. 

“Productivity in the capitalist sense is based on relative productivity—that the worker not only replaces an old value, but creates a new one; that he materialises more labour-time in his product than is materialised in the product that keeps him in existence as a worker. It is this kind of productive wage-labour that is the basis for the existence of capital.” (p 153) 

Capitalism is not based upon the creation of products, but commodities, products created only in order to be sold at a profit. In other words, capitalism is a system, based upon the creation of profit, and so only what creates profit is productive in capitalist terms. 

“Only labour which is directly transformed into capital is productive; that is, only labour which makes variable capital a variable magnitude and consequently [makes the total capital C] equal to C+Δ.” (p 393)

Capital appropriates the productive power of labour, including the productive power that results from co-operative labour, from mental labour, and so on. But, this applies only to the use value of capital. In other words, it affects the physical aspects of the labour process, thereby increasing the quantity of output resulting from that process. 

If 100 handicraft workers, working independently, produce 100 chairs, in a week, but 100 workers working cooperatively, as a result of a division of labour produce 200 chairs in a week, double the number of chairs has been produced, but only the same amount of value has been produced, i.e. 100 weeks of labour.

“Whether a hundred work together, or each one of the hundred works by himself, the value of their product is equal to a hundred days’ labour, whether represented in a large or small quantity of products; that is to say, the productivity of the labour does not affect the value.” (p 393)

The only way this affects value is where this type of production is the exception to the normal labour process. In other words, if production of chairs continues to be undertaken, in the main, by handicraft workers, working independently. Then the individual value of the chairs produced built by the co-operative labour will be half that of their market value. But, this only applies in respect of the production of a particular type of commodity, not between one industry and another.

“As against this, take another branch of production, for example type-setting, in which up to now no machinery is used. Twelve hours in this branch produce just as much value as twelve hours in branches of production in which machinery, etc., is developed to the utmost. Hence labour as producing value always remains the labour of the individual, but expressed in the form of general labour. Consequently productive labour—as labour producing value—always confronts capital as labour of the individual labour-power, as labour of the isolated labourer, whatever social combinations these labourers may enter into in the process of production. While therefore capital, in relation to the labourer, represents the social productive power of labour, the productive labour of the workmen, in relation to capital, always represents only the labour of the isolated labourer.” (p 394)