Wobbly times number 188

An Introduction to Bataille's ACCURSED SHARE
                     with a side trip to Debord's "Society of the Spectacle" 

Wobbly times number 185

Workers produce the wealth of nations for wages.

The upper 10% own 80% of the wealth workers
produce.  The social wage gets some of that
wealth back to the workers.  The social wage
is funded by taxes on the wealth workers
produce.  Trickle down economic theory states
that the taxes on the upper 10% should be cut.
This leads to the declaration of 'budget emergencies' 
by conservative politicians and to calls for
either more regressive taxes e.g. widening and
raising the GST or cuts to public health, education
and welfare, including the age pension.

How much wealth would be produced in Australia
during the month of May, if everyone who depends
on wages to make a living went on general strike
from May 1st to May 31st?

Wobbly times number 168

          LET'S MAKE KARL DISAPPEAR.

An Introduction to the Three Volumes of Karl Marx’s Capital
By Michael Heinrich
(translated by Alexander Locascio)
New York: Monthly Review Press, 2012, 240 pages, $15.95 paper.

This book might more properly be titled, AN INTRODUCTION TO MICHAEL HEINRICH'S INTERPRETATION OF WHAT MARX MEANT BY: VALUE, PRICE, PROFIT AND THE SOCIAL RELATION OF CAPITAL.  As much I appreciate Heinrich's effort on Marx, all too often, the man irritates me. For instance, right off the bat, he faults Engels as having a lack of understanding of Marx which led to the errors Heinrich perceives amongst the Marxists who would take up the cause of socialism in the 20th century. He's just plain wrong about this, as Marx would have had discussions with Engels over the supposed theoretical shortcomings in Engels' work, prior to his own death.  It wasn't like Marx never spoke honestly with Engels about political-economy. It's more the case that Heinrich, like so many graduate student Marxists after the death of Engels, tries to replace Fred as the better interpreter of Marx with Michael.   Is he?

For instance on page 15 he writes:

"In precapitalist societies, the exploitation of the dominated class served primarily the consumption of the ruling class: its members led a luxurious life, used appropriated wealth for their own edification or for that of the public (theater performances in ancient Greece, games in ancient Rome) or to wage war. Production directly served the fulfillment of wants: the fulfillment of the (forcibly) restricted needs of the dominated class and the extensive luxury and war needs of the ruling class.  Only in exceptional cases was the wealth expropriated by the ruling class used to enlarge the basis of exploitation, such as when consumption was set aside to purchase more slaves, to produce a greater amount of wealth."

What Heinrich neglects to add, to his otherwise cogent observations, is that war itself was a slave generator thus, an expansion of Empire in the ancient world was largely founded on the accumulation of slaves, in short, of wealth producers as well as the wealth they produced. 

Yet, there are parts of Heinrich's approach to Marx's critique of Capital which I do like and appreciate--many in fact.  For instance, his hard headed approach to capitalism and the question of the morality of the capitalists themselves.  On page 16 he writes:

"The fact that earnings do not primarily serve the consumption of the capitalist, but rather the continuous valorizastion of capital, that is, the restless movement of more and more accumulation, might sound absurd.  But the issue at hand is not an individual act of insanity.  Individual capitalists are forced into this movement of restless profiteering (constant accumulation, expansion of production, the introduction of new technology etc.) by competition with other capitalists: if accumulation is not carried on, if the apparatus of production is not constantly modernized, then one's own enterprise is faced with the threat of being steamrolled by competitors who produce more cheaply or who manufacture better products."  

Of course, a similar relation between the accumulation of wealth and the possession of political power by the few in the ruling class over other human beings pertains to pre capitalist societies.  More slaves meant more wealth and more slaves and wealth were part and parcel of the expansion of the empires of the ancients.  Heinrich doesn't point this out.  In his pretty good attempt, he demonstrates that capitalism is not based on moral choices, rather that capitalists are being forced to accumulate wealth as Capital in order to maintain political power over the producers of wealth and over their competitor capitalists in the arena, the marketplace of commodities.  But,  he fails to get beyond properly labeling this, the victory of abstraction, the victory of exchange-value over human beings, especially the producers of wealth.  The problem with Heinrich's approach is that it makes pre capitalist exploitation look substantially different in content when it is actually only different in form.   Slaves were commodities too.  The product of slave labour time belonged to the slaves' owners.  Surplus wealth in one area of class rule was traded for surplus wealth in another.  The surplus wealth, whether from the application of labour power or the mere possession of natural resources becomes private property in class dominated society.  Trade makes commodities of these use-values of wealth whether theses useful values are slaves, perfume, cattle or gold.  The use-value of the commodity is, of course, both necessary and that necessity is perceived by the human subject/buyer i.e. in the eyes of the beholder in the marketplace of commodities.

Heinrich seems to me to continually put labour power i.e. the human producer in the backseat of the drive to accumulate wealth/capital.  While he is spot on when he says, "..a critique that takes aim at the 'excessive profit-seeking' of individual capitalists but not at the capitalist system as a whole.." because that is too 'narrow', his outline of the system as a whole fails to give credit where credit is due--to its producers, its wage labourers.  After all, without wage labour there can be no Capital.  But Heinrich wants his readers to focus on how value becomes 'valorized', not how it is produced: how it becomes an abstraction in his version of exchange-value (essentially price), as opposed to the moral shortcomings of individual capitalists.  Fair enough on the critique of liberal moralism, even radical liberal moralism.  But in his paragraph describing how the system works, he writes things like:

"By capital we understand (provisionally; we'll get more precise later) a particular sum of value, the goal of which is be 'valorized,' which is to say, generate a surplus." p.16  How does an abstraction generate a surplus?  Where does the surplus come from?  It comes from the capitalist employing labour for wages, the price of the worker's skills in the labour market.  But the price itself is not the living socially necessary labour time, the energy embodied in the finished, marketed good or service.  That living labour time is what constitutes its value. The price of a commodity is determined outside the production process by consumer' demand in the market.  The price fluctuates around the value of the supply of the produced commodity on the market and value is the socially necessary labour time embodied in those commodified goods and services.

But what does Heinrich say?

"The surplus can be obtained in various ways.  In the case of interest-bearing capital, money is lent at interest.  The interest thus constitutes the surplus.  In the case of merchant capital, the products are purchased cheaply in one place and sold dearly in another place (or at another point in time).  The difference between the purchase price and the sale price (minus the relevant transaction costs) constitutes the surplus." p.16

This sort of historical mystification is typical in Heinrich's INTRODUCTION TO THE THREE VOLUMES OF KARL MARX'S CAPITAL. Transaction costs?  Like the socially necessary labour time of the sailors, the ship builders and others who use their skills to get the commodity bought, transported and profitably sold in the market?  

No.  These are near invisible to Heinrich.  What he makes visible is the price which is in reality the abstraction. What he makes invisible is the producer who sells a skill to an employer for a wage and who thereby agrees to give up control and ownership of what s/he produces, i.e. the surplus wealth created within the labour time applied by the worker.  

I point out these flaws, not because I want to nit-pick my way though Heinrich's book; but to demonstrate that the good professor neither has the grasp of Marx's critique of political-economy that Engels had, nor is he able to come up with a totally reliable application of Marx's theories of surplus value to the 21st century.   

Heinrich just doesn't get the point that socially necessary labour time (snlt) is embodied in ALL commodities, including the individual worker's skills, skills which are being sold to an employer for their market price. He does see that commodities are exchanged on the basis of their snlt; but his emphasis on the act of exchange makes him deny the fact that without snlt the good or service would not exist in the first place to be compared for exchange. Thus, he does not take into account the fact that an electrical engineer's skills sell for a higher price than a worker who has no skills and only a high school education because the engineer's skills have more socially necessary labour time embodied them than the unskilled high school graduate does. This error leads to many, many errors in his INTRODUCTION TO MARX'S THREE VOLUMES OF CAPITAL.  He seems to confuse the abstraction of price with value, the socially necessary labour time embodied in a commodity, pretty consistently.  

"The owner of labour-power is mortal. If then his appearance in the market is to be continuous, and the continuous conversion of money into capital assumes this, the seller of labour-power must perpetuate himself, “in the way that every living individual perpetuates himself, by procreation.” [8] The labour-power withdrawn from the market by wear and tear and death, must be continually replaced by, at the very least, an equal amount of fresh labour-power. Hence the sum of the means of subsistence necessary for the production of labour-power must include the means necessary for the labourer’s substitutes, i.e., his children, in order that this race of peculiar commodity-owners may perpetuate its appearance in the market. [9]

"In order to modify the human organism, so that it may acquire skill and handiness in a given branch of industry, and become labour-power of a special kind, a special education or training is requisite, and this, on its part, costs an equivalent in commodities of a greater or less amount. This amount varies according to the more or less complicated character of the labour-power. The expenses of this education (excessively small in the case of ordinary labour-power), enter pro tanto into the total value spent in its production."

"The value of labour-power resolves itself into the value of a definite quantity of the means of subsistence. It therefore varies with the value of these means or with the quantity of labour requisite for their production." Karl Marx CAPITAL 

Heinrich claims Marx intends the first chapter of the first volume of CAPITAL as purely theoretical and that the analysis of the commodity therein can't be placed in historical context. I think he is wrong. Socially necessary labour time can be seen in traded commodities during earlier, first modes of production and exchange-- C-M-C under class rule.   A peasant knows about how much time it takes to produce something he wants to trade for something he is willing to trade from his own work. Generalised commodity production under the rule of Capital M-C-M' is generalised wage labour and this combined with the ubiquitous money commodity obscures, indeed fetishises the source of wealth and the socially necessary labour time embodied within it in the modern age.  All of which is why Marx attempts to explain how all this snlt in commodities ends up being represented in the money commodity, even in the fetishised world of generalised commodity production and sale under the rule of Capital:

"The value of a single commodity, the linen, for example, is now expressed in terms of numberless other elements of the world of commodities. Every other commodity now becomes a mirror of the linen’s value.^[25] It is thus, that for the first time, this value shows itself in its true light as a congelation of undifferentiated human labour. For the labour that creates it, now stands expressly revealed, as labour that ranks equally with every other sort of human labour, no matter what its form, whether tailoring, ploughing, mining, &c., and no matter, therefore, whether it is realised in coats, corn, iron, or gold. The linen, by virtue of the form of its value, now stands in a social relation, no longer with only one other kind of commodity, but with the whole world of commodities. As a commodity, it is a citizen of that world. At the same time, the interminable series of value equations implies, that as regards the value of a commodity, it is a matter of indifference under what particular form, or kind, of use value it appears."  (Emphasis mine)

"The universal equivalent form is a form of value in general. It can, therefore, be assumed by any commodity. On the other hand, if a commodity be found to have assumed the universal equivalent form (form C), this is only because and in so far as it has been excluded from the rest of all other commodities as their equivalent, and that by their own act. And from the moment that this exclusion becomes finally restricted to one particular commodity, from that moment only, the general form of relative value of the world of commodities obtains real consistence and general social validity."

And further on in the same chapter of CAPITAL volume I, Marx writes:
.

"The particular commodity, with whose bodily form the equivalent form is thus socially identified, now becomes the money commodity, or serves as money. It becomes the special social function of that commodity, and consequently its social monopoly, to play within the world of commodities the part of the universal equivalent. Amongst the commodities which, in form B, figure as particular equivalents of the linen, and, in form C, express in common their relative values in linen, this foremost place has been attained by one in particular – namely, gold. If, then, in form C we replace the linen by gold, we get, 

D. The Money-Form

20 yards of linen = 1 coat = 10 lbs of tea = 40 lbs of coffee = 1 quarter of corn = 2 ounces of gold = ½ a ton of iron = x Commodity A =

= 2 ounces of gold

In passing from form A to form B, and from the latter to form C, the changes are fundamental. On the other hand, there is no difference between forms C and D, except that, in the latter, gold has assumed the equivalent form in the place of linen. Gold is in form D, what linen was in form C – the universal equivalent. The progress consists in this alone, that the character of direct and universal exchangeability – in other words, that the universal equivalent form – has now, by social custom, become finally identified with the substance, gold.

CAPITAL

In my opinion, Heinrich is just plain wrong about socially necessary labour time not being materially embedded in commodities. The finished commodity is the crystallisation of applied snlt.  I think of snlt as energy which is equal to and embodied within the material object or service.  E=Matter embodied in the Commodity through Time, if you will. 

"In general, the greater the productiveness of labour, the less is the labour time required for the production of an article, the less is the amount of labour crystallised in that article, and the less is its value; and vice versâ, the less the productiveness of labour, the greater is the labour time required for the production of an article, and the greater is its value. The value of a commodity, therefore, varies directly as the quantity, and inversely as the productiveness, of the labour incorporated in it."  CAPITAL 

Other than that, Heinrich does a pretty good job of explaining many of the intentions and conceptual formations which Karl Marx put forward in his three volumes of CAPITAL. I especially enjoyed reading his critique of the tendency for the rate of profit to fall.  So many self-described Marxists (NOT ALL) are wedded to interpreting this tendency as an unbending principle of Capital's inevitable self-destruction. Still, even here, his analysis is flawed because of his inability to adequately differentiate between the abstraction of exchange-value in market price and its concrete expression as socially necessary labour time embodied in goods and services at the point of production.

Yet, Heinrich does write with flashing brilliance at times.  Here's an example:

"Wages, profits, and rent thus seem to be nothing other than the portions of the product's value that can be traced back to the functioning of wage-labor, capital, and landed property.  At the same time, the transformation of the value of labor-power into the 'value of labor' (see section 4.5) is fundamental: precisely because the wage appears to compensate the 'value of labor,' the remaining components of newly added value, profit and rent, must emanate from the remaining two 'factors of production', capital and landed property.  Since commodities are not exchanged at their values but rather at prices of production, this semblance cannot be resolved with regard to a single commodity.  There does not appear to be any sort of connection between the expended labour on the one hand, and the average profit and rent on the other: profit depends (under normal conditions) upon the size of the capital employed, regardless whether many or few laborers are employed, and rent depends upon which land and how much of it is used." p.184

He follows that paragraph up with this zinger from Marx:

"..the mystification of the capitalist mode of production, the reification of social relations, and the immediate coalescence of the material relations of production with their historical and social specificity: the bewitched, distorted and upside-down world haunted by Monsieur le Capital and Madame la Terre, who are at the same time social characters and mere things" Marx CAPITAL

One more aspect of Heinrich's work which I would like to draw your attention to is his problem with reading Engels when it comes to the question of the political State.  To Michael Heinrich, the modern bourgeois democratic State is not as much the political expression of class rule as it is an independent entity which mediates the abstractions of capitalism while attempting to control the periodic disruptions which erupt between workers and capitalists and between capitalists in the marketplace.  Engels, and Marx for that matter, saw the State as the political expression of class rule through history.  In no way did they see the State as being the same governing structure, whether ancient, feudal or the modern bourgeois democratic State. But when one reads Heinrich, one gets the impression that they did, especially Engels.

"Under capitalist social relations, direct political force is not necessary for the maintenance of economic exploitation: it is sufficient for the state as a force standing above society to guarantee that all members of society behave like owners of private property.  However, the state must be a discrete, independent force, since it has to compel all members of society to recognize one another as private owners." p.204

Both Marx and Engels realised that capitalist democracy was not the same as the monarchist absolutism of feudalism or slave owning dictatorships of class rule.  Why else would they be so keen on promoting the Social Democracy of their day and age?  And while the capitalist class would like the State to appear as an independent force, cementing civil society together 'fairly', the reality is, as Marx put it in when he was in his 20s, "The existence of the state is inseparable from the existence of slavery." 

Young Marx's observation aside, Heinrich sees the governing structure of capitalist class rule like this: "The state does in fact conduct itself as a neutral instance with regard to its citizens; this neutrality is in no way merely an illusion.  Rather it is precisely by means of this neutrality that the state secures the foundations of capitalist relations of domination and exploitation. The defense of property implies that those who possess no relevant property beyond their own labor-power must sell their labor-power." p.205

Neutrality? Must is more like it. Tell it to the workers on the picket line, Professor Heinrich, especially when the police are sent in to defend the scabs crossing said picket line.  To be sure, the political expression is more about class mediation than say the absolutism of the old feudal State. But the modern, industrial political State is not neutral; it is profoundly partisan defending the class interests of those who own and control the natural resources and the collective product of labour in either companies or via the State itself.  Of course, many workers are under the illusion that government is neutral that is, until they have a run in with the armed bodies of men and women who are hired by the State to defend the property rights of the capitalists. When do the police arrest the capitalists for violating the rights of the workers to the product of their labour?

"This shattering of the former state power and its replacement by a new and really democratic state is described in detail in the third section of The Civil War. But it was necessary to dwell briefly here once more on some of its features, because in Germany particularly the superstitious belief in the state has been carried over from philosophy into the general consciousness of the bourgeoisie and even to many workers. According to the philosophical notion, “the state is the realization of the idea” or the Kingdom of God on earth, translated into philosophical terms, the sphere in which eternal truth and justice is or should be realized. And from this follows a superstitious reverence for the state and everything connected with it, which takes roots the more readily as people from their childhood are accustomed to imagine that the affairs and interests common to the whole of society could not be looked after otherwise than as they have been looked after in the past, that is, through the state and its well-paid officials. And people think they have taken quite an extraordinary bold step forward when they have rid themselves of belief in hereditary monarchy and swear by the democratic republic. In reality, however, the state is nothing but a machine for the oppression of one class by another, and indeed in the democratic republic no less than in the monarchy; and at best an evil inherited by the proletariat after its victorious struggle for class supremacy, whose worst sides the proletariat, just like the Commune, cannot avoid having to lop off at the earliest possible moment, until such time as a new generation, reared in new and free social conditions, will be able to throw the entire lumber of the state on the scrap-heap.

"Of late, the Social-Democratic philistine has once more been filled with wholesome terror at the words: Dictatorship of the Proletariat. Well and good, gentlemen, do you want to know what this dictatorship looks like? Look at the Paris Commune. That was the Dictatorship of the Proletariat."

Frederick Engels

London, on the 20th anniversary
of the Paris Commune, March 18, 1891

So yes, do read Heinrich's INTRODUCTION TO THE THREE VOLUMES OF KARL MARX'S CAPITAL. But please remember that wealth, no matter which historical era it is produced in, whether it be produced by slaves, peasants or wage-slaves, that commodified product of social labour can be sold or traded for something perceived as being of equal socially necessary labour time and that is what makes a good or service or labour power exchangeable.  In fact, I'd say that Marx's own speech to workers in 1865 is still the best introduction to CAPITAL.  It's now called "Value, Price and Profit". Keep in mind as you read Heinrich's work, the fact that private ownership of wealth is, in itself, a political power over those who produce it. Socialism means the collective product of labour is owned and controlled by labour itself and the end of class rule and its political State.

In future, the perception of the subject-object relation is what I would have had Heinrich put more focus on: humans and their mental perception of their own and their fellow producers' labour time and what that labour time results in.  Engels wasn't wrong with his interpretation of Marx's critique of political-economy.   Heinrich just can't read Engels in historical context.  Yes, Heinrich is spot on with his observations on the failures of mainstream Social Democrats and Marxist-Leninists to grasp the philosophical depth of Marx's dialectical analysis in CAPITAL.  No, Heinrich does not give his readers an adequate explanation of what socialism meant to Marx and Engels, a socialism which could begin with labour vouchers based on socially necessary labour time--to make the relationship between the product and the producer transparent.  This proposal is something which Heinrich rejects by associating it with socialist schemes which retain commodity production and exchange (see for example Proudhon).

"In Marx's time, this question was not a merely academic one. Various socialist tendencies, in devising alternatives to capitalism, aspired to a society in which private commodity production would continue to exist, but money would be abolished and replaced by certificates of entitlement to good or slips denoting hours of performed labor." p.57

Yet, contra Heinrich and his constant attempt to decouple socially necessary labour time from value embodied in goods and services, Marx suggests using labour time vouchers under a communist mode of production and exchange more than once:

The following is an excerpt from the first chapter of the first volume of CAPITAL by Karl Marx.

"Let us now picture to ourselves, by way of change, a community of free individuals, carrying on their work with the means of production in common, in which the labour power of all the different individuals is consciously applied as the combined labour power of the community. All the characteristics of Robinson’s labour are here repeated, but with this difference, that they are social, instead of individual. Everything produced by him was exclusively the result of his own personal labour, and therefore simply an object of use for himself. The total product of our community is a social product. One portion serves as fresh means of production and remains social. But another portion is consumed by the members as means of subsistence. A distribution of this portion amongst them is consequently necessary. The mode of this distribution will vary with the productive organisation of the community, and the degree of historical development attained by the producers. We will assume, but merely for the sake of a parallel with the production of commodities, that the share of each individual producer in the means of subsistence is determined by his labour time. Labour time would, in that case, play a double part. Its apportionment in accordance with a definite social plan maintains the proper proportion between the different kinds of work to be done and the various wants of the community. On the other hand, it also serves as a measure of the portion of the common labour borne by each individual, and of his share in the part of the total product destined for individual consumption. The social relations of the individual producers, with regard both to their labour and to its products, are in this case perfectly simple and intelligible, and that with regard not only to production but also to distribution."

from CAPITAL volume I, chapter one

"Within the co-operative society based on common ownership of the means of production, the producers do not exchange their products; just as little does the labor employed on the products appear here as the value of these products, as a material quality possessed by them, since now, in contrast to capitalist society, individual labor no longer exists in an indirect fashion but directly as a component part of total labor. The phrase "proceeds of labor", objectionable also today on account of its ambiguity, thus loses all meaning.

"What we have to deal with here is a communist society, not as it has developed on its own foundations, but, on the contrary, just as it emerges from capitalist society; which is thus in every respect, economically, morally, and intellectually, still stamped with the birthmarks of the old society from whose womb it emerges. Accordingly, the individual producer receives back from society -- after the deductions have been made -- exactly what he gives to it. What he has given to it is his individual quantum of labor. For example, the social working day consists of the sum of the individual hours of work; the individual labor time of the individual producer is the part of the social working day contributed by him, his share in it. He receives a certificate from society that he has furnished such-and-such an amount of labor (after deducting his labor for the common funds); and with this certificate, he draws from the social stock of means of consumption as much as the same amount of labor cost. The same amount of labor which he has given to society in one form, he receives back in another.

"Here, obviously, the same principle prevails as that which regulates the exchange of commodities, as far as this is exchange of equal values. Content and form are changed, because under the altered circumstances no one can give anything except his labor, and because, on the other hand, nothing can pass to the ownership of individuals, except individual means of consumption. But as far as the distribution of the latter among the individual producers is concerned, the same principle prevails as in the exchange of commodity equivalents: a given amount of labor in one form is exchanged for an equal amount of labor in another form.

"Hence, equal right here is still in principle -- bourgeois right, although principle and practice are no longer at loggerheads, while the exchange of equivalents in commodity exchange exists only on the average and not in the individual case.

"In spite of this advance, this equal right is still constantly stigmatized by a bourgeois limitation. The right of the producers is proportional to the labor they supply; the equality consists in the fact that measurement is made with an equal standard, labor.

"But these defects are inevitable in the first phase of communist society as it is when it has just emerged after prolonged birth pangs from capitalist society. Right can never be higher than the economic structure of society and its cultural development conditioned thereby.

"In a higher phase of communist society, after the enslaving subordination of the individual to the division of labor, and therewith also the antithesis between mental and physical labor, has vanished; after labor has become not only a means of life but life's prime want; after the productive forces have also increased with the all-around development of the individual, and all the springs of co-operative wealth flow more abundantly -- only then then can the narrow horizon of bourgeois right be crossed in its entirety and society inscribe on its banners: From each according to his ability, to each according to his needs!"

from the Critique of the Gotha Programme

"On the basis of socialised production the scale must be ascertained on which those operations — which withdraw labour-power and means of production for a long time without supplying any product as a useful effect in the interim — can be carried on without injuring branches of production which not only withdraw labour-power and means of production continually, or several times a year, but also supply means of subsistence and of production. Under socialised as well as capitalist production, the labourers in branches of business with shorter working periods will as before withdraw products only for a short time without giving any products in return; while branches of business with long working periods continually withdraw products for a longer time before they return anything. This circumstance, then, arises from the material character of the particular labour-process, not from its social form. In the case of socialised production the money-capital is eliminated. Society distributes labour-power and means of production to the different branches of production. The producers may, for all it matters, receive paper vouchers entitling them to withdraw from the social supplies of consumer goods a quantity corresponding to their labour-time. These vouchers are not money. They do not circulate."

CAPITAL Volume II, chapter 18, page 358

Finally, there is no doubt that the credit system will serve as a powerful lever during the transition from the capitalist mode of production to the mode of production of associated labour; but only as one element in connection with other great organic revolutions of the mode of production itself. On the other hand, the illusions concerning the miraculous power of the credit and banking system, in the socialist sense, arise from a complete lack of familiarity with the capitalist mode of production and the credit system as one of its forms. As soon as the means of production cease being transformed into capital (which also includes the abolition of private property in land), credit as such no longer has any meaning. This, incidentally, was even understood by the followers of Saint-Simon. On the other hand, as long as the capitalist mode of production continues to exist, interest-bearing capital, as one of its forms, also continues to exist and constitutes in fact the basis of its credit system. Only that sensational writer, Proudhon, who wanted to perpetuate commodity-production and abolish money, was capable of dreaming up the monstrous crèdit gratuit, the ostensible realization of the pious wish of the petty-bourgeois estate. 

CAPITAL Volume III, chapter 36, page 607


Thus, Marx proposes to demystify the relations which occur with money and generalised commodity production. Marx and Engels hoped that this beginning for socialism would be developed by the producers, democratically organised in free association and as they shed the the scars of class society (e.g. the free-rider syndrome among others), the distribution of the collective produce of society would morph into one based purely what humans needed while gaining maximum sovereignty for the individual to decide what to do with their lives and free-time.

Wobbly times number 167

Monsieur Le Capital and Madame La Terre

"It is an enchanted, perverted, topsy-turvy world, in which Monsieur le Capital and Madame la Terre do their ghost-walking as social characters and at the same time directly as mere things."  Marx, CAPITAL V.3

"Capital and 'land' in capitalist society obtain magical abilities similar to those of wooden or cloth fetishes in allegedly 'primitive socieites'."  Michael Heinrich, AN INTRODUCTION TO THE THREE VOLUMES OF KARL MARX'S CAPITAL, p.184

Can wooden or cloth fetishes produce material things, services or ideas?

Can the Ford Motor Corporation produce cars?

Can land create wealth?

Or is it the case that humans produce material things, services and/or ideas. And that the workers (employed for the wages their labour power market for) by the capitalists who own Ford Motor Corporation who actually produce cars using tools, machines and buildings on land owned by others.  And that the land creates nothing, unless human labour is applied its productive use to grow food, mine ore or dam rivers, to use to produce power from dynamos produced by workers.

"Profit seems to be determined only secondarily by direct exploitation of labour, in so far as the latter permits the capitalist to realise a profit deviating from the average profit at the regulating market-prices, which apparently prevail independent of such exploitation."  Marx, CAPITAL V.3 

Value, price and profit appear to be generated in the sale of the commodity on the market.  The reality is that the good or service is produced by humans applying skill over time.  Without labour, nothing gets produced.  The fact that labour power is paid for in wages, makes it appear that labour is merely one element of the cost-price going into the finished good or service (the others being the cost-amortizing means of production, raw material and transport, including marketing) as opposed to being the generator of its product, wealth which becomes a surplus of value over and above what is paid out in wages for the value of labour power sold to the employer.  This surplus-value is realised in the market through sale for a price and profit (money in hand), an extra amount of wealth over and above what existed before the workers arrived to begin their eight hours of socially necessary labour time. Mystery solved!  The reality is that capital, land and raw materials produce nothing: THEY ARE INANIMATE OBJECTS.   

"In surplus-value, the relation between capital and labour is laid bare; in the relation of capital to profit, i.e., of capital to surplus-value that appears on the one hand as an excess over the cost-price of commodities realised in the process of circulation and, on the other, as a surplus more closely determined by its relation to the total capital, the capital appears as a relation to itself, a relation in which it, as the original sum of value, is distinguished from a new value which it generated. One is conscious that capital generates this new value by its movement in the processes of production and circulation. But the way in which this occurs is cloaked in mystery and appears to originate from hidden qualities inherent in capital itself."  Marx CAPITAL V.3

Socially necessary labour time is the 'hidden' quality inherent in capital--hired human skill.  Capital is a social relation between capitalist employers and labouring humans.  The capitalists produce no value.  The capitalists buy the value of labour power and employ humans for wages to produce more  wealth than the the value inherent in the value of these self-same humans' labour power.  The cost-price of the commodities sold at what appear to be more than their value are actually the product of the unpaid labour time of workers being paid a fraction of the wealth they create.  Certainly, capital + land + labour power=a surplus over and above the cost-price.  But this surplus is not produced magically by capital and land: Madame La Terre seems to produce wealth with her consort Monsieur Le Capital--after the sale of wealth produces a profit.  In reality, these abstractions produce nothing and labour is the source for the creation of wealth not already existing (unrealised) in the ground, in natural resources like gold, iron and fertile soil and in the sea.  To be sure, existing wealth may be found on other planets and in other places in the Universe as human labour fashions the instruments, machines and vehicles necessary for their discovery and use.  But Mercury produces no wealth in 2013.  Neither do Mars or Jupiter.  And without production, sale cannot take place except in the imagination of the beholder.  

Wobbly times number 162

The future is bright.  "Be happy in your work."

 Real wages in the USA have been stagnant since the mid-60s as labour productivity has increased in real terms at a 1.3% clip.  Marx demonstrated that the exchange-value of a commodity decreases as the productivity of labour increases.  The lower the value of commodities produced by labour, the lower the rate of profit, which of course, only occurs after the commodities have been sold at prices which fluctuate with supply and demand around their exchange-values.

Who will buy these beautiful commodities?

Some will be purchased by capitalists and landlords; but they will only buy as much as they think they need. After all, it's socially necessary labour time which goes into the commodities which are being sold.  Part of what makes up the concept of 'socially necessary' is in the eyes and pocketbooks of the consumer. When the commodities being sold are more in number than the mass market can absorb (mostly because the the mass market's stagnating real wages), capitalists don't invest in industries in which workers would be producing more commodities than could be sold ergo, the cash sloshing around in capitalist bank accounts these days.  So, there is a capitalist tendency to invest in ephemeral finance capitalist instruments, including government bonds issued by nations where capitalists are in a selling boom e.g. Australia's mining capitalists.

Australia's dollar (AUD) is now very much stronger (59 USD cents in 2000/$1.05 USD 2013), as a result of the industrial mining boom while the U.S. dollar (USD) is very much weakened through the export of the non-finance/industrial capital to areas of the world where increased rates of profit can be achieved via much lower prices for labour power of the same value as in the U.S.A.. However, the U.S. working class will begin to catch up with the low prices for labour power in other parts of the world and will be kept in that state as the price of the USD commodity (yes, money is a commodity too) falls due to Quantitative Easing (QE).  The falling USD will stimulate the export of commodities produced by U.S. workers making ever lower real wages, especially when those wages are in USD with less and less value. So, expect more investment in the USA by foreign and domestic capitalists in future where rates of profit will be greater due to lowered real wages and ever increasing labour productivity.   The AUD will remain strong as long as capitalist consumers in China, India and other industrialising political States keep buying iron ore and other natural resources like coal from Australian capitalists prices exceeding the value of the commodities being sold.  That is, Australian mining capitalists are selling coal and iron at prices computed in the overpriced AUD.  When and if other sources for this wealth found in Nature are found, the AUD and the Australian economy will fall.  Then and only then, will Australian capitalists not in the mining business be able to hire cheaper Australian labour power, denominated in a lower priced AUD for the purpose of producing commodities like solar power panels and so on for export to the mass markets of the world.

The private ownership of wealth is, in itself, a political power over those whose share of the wealth, the majority produce, is considerably less than it should be--I mean, seeing as the majority produced it in the first place. M>C>M' =wage-labour

Wobbly times number 146

Michael R. Krätke - Why Could Max Not Complete Capital? from FastBodies on Vimeo.

I think Kraetke's assessment of the GRUNDRISSE is spot on. Marx wanted clarity and the GRUNDRISSE is Marx thinking in left Hegelian conceptual language.  The GRUNDRISSE was never meant for generalised publication.  I'd be wary though of distancing Marx too far from Hegel, as one can then miss the dialectical analyses which continue through CAPITAL and the THEORIES OF SURPLUS VALUE. The first chapter of the first volume of CAPITAL is a masterpiece; but if you can't discern the dialectical movement, the unity of opposites, the subject/object relationship, it may appear to be too difficult to grasp. I think this is what Lenin was getting at when he quipped that none of the Marxists had been able to grasp CAPITAL except in a very mechanical way...this was after his close reading of Hegel's LOGIC during his sojourn in Switzerland. Haw! But my critique of Lenin is that he didn't grasp the necessity for removing wage-labour from Soviet daily life. ;p I would be most interested in any expansion Marx made in his observations vis a vis the fetishism of commodities. I also find the general topic of fetishism which Kraetke indicates was of further interest to Marx fascinating.

The exploitation of the producers of wealth by the owning, ruling classes has been a world system since most of humanity left the classless hunting and gathering means of producing sustenance. Political States develop out of these producer/owner social relations. How to overcome exploitation inherent in class dominated societies and modes of production, this was the political project of communists like Marx, IMO.  Marx was able to develop his critique of political-economy as he learned more about how the complexities of the system operated historically and were developing as he was alive. Obviously, Marx didn't repudiate the labour theory of value; but he was becoming more aware of how the price of commodities was being manipulated into reflecting much more value than they had through the development of promissory notes via various forms of credit--to Marx 'fictitious capital'. 


State forms of development out of pre-agricultural classless society also caught his attention via Morgan's ANCIENT SOCIETY.  The attempt to link calculus to Capital's boom/bust cycles is also fascinating.  I never knew that Samuel Moore was a math consultant to Marx.  Anyway, an interesting lecture given by a well informed academic.  

Wobbly times number 125

"At the end of the chapter [on primitive accumulation] the historic tendency of [capitalist] production is summed up thus: That it itself begets its own negation with the inexorability which governs the metamorphoses of nature; that it has itself created the elements of a new economic order, by giving the greatest impulse at once to the productive forces of social labour and to the integral development of every individual producer; that capitalist property, resting as it actually does already on a form of collective production, cannot do other than transform itself into social property. At this point I have not furnished any proof, for the good reason that this statement is itself nothing else than the short summary of long developments previously given in the chapters on capitalist production."   Karl Marx
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I think that the 'development of every individual producer' was undermined by the very historical process on which collective production expanded. Through this lens we see the commodification of human relations. With the cheapening of the commodity through industrialisation came the cheapening of social relations of solidarity in both the working class and its masters. The commodity is corrosive to community.  Yes, communities can develop under class rule, even with all their dominance and submission fetishes. Reactionaries seize on the feelings of insecurity which generalsed commodity production induces and push the need to look backwards in time for salvation from moral corruption.  Liberals feel the commodity's alienating powers, describe them and then resign themselves to the absurdities of life and shop on. Use-value (the material core of the commodity, encased in its capitalist shell of exchange-value) is lost in a haze of electronic blips, buying and selling, gaining market share. And always, the relentless cheapening of the commodity mingling with capitalist class society as a whole. And the proletariat calls itself the middle class and thinks of themselves as individual consumers, competing for the lowest prices.  And with less and less labour time in the collective product, the fact that it is a collective product of labour disappears in an immense, constant sale. Wherever you look, you see an advertisement for a commodity. The 'development of every individual producer' is not something to be assumed.  History demonstrates that this development requires education, agitation and organisation by and amongst the workers themselves about who creates the wealth and which class appropriates the lion's share of both wealth and political power through the wages system of slavery.  

"Labour is, in the first place, a process in which both man and Nature participate, and in which man of his own accord starts, regulates, and controls the material re-actions between himself and Nature. He opposes himself to Nature as one of her own forces, setting in motion arms and legs, head and hands, the natural forces of his body, in order to appropriate Nature's productions in a form adapted to his own wants. By thus acting on the external world and changing it, he at the same time changes his own nature. He develops his slumbering powers and compels them to act in obedience to his sway. We are not now dealing with those primitive instinctive forms of labour that remind us of the mere animal. An immeasurable interval of time separates the state of things in which a man brings his labour-power to market for sale as a commodity, from that state in which human labour was still in its first instinctive stage." Karl Marx 


But what also has happened is the commodification of human relations, of social relations. The discipline necessary to maintain the sophisticated division of labour within industrially developed capitalism, to keep it running the show, so to speak, is made easier for our rulers as the commodity invades our everyday lives at every level and even our relation with Nature. Commodification develops cheapness in critical thinking as it destroys Nature in the pursuit of market share. "We had to destroy the Earth in order to save the economy."   The commodity puts a price on everything. Our mind's eyes are fixed firmly on consumer prices. Reification is built into the language as corporations become thought of as subjects creating wealth. "Mercedes produces the best cars."  The legalised separation of the product from the producer is aided and abetted by commonplace notions, embedded in the cultural intercourse which distance concepts like 'expoitation' from 'wage' and hitch words like 'fair' and 'social justice' to more 'humanely' moderated wage-slavery.  

The possibility of securing for every member of society, by means of socialised production, an existence not only fully sufficient materially, and becoming day by day more full, but an existence guaranteeing to all the free development and exercise of their physical and mental faculties -- this possibility is now for the first time here, but it is here.

With the seizing of the means of production by society, production of commodities is done away with, and, simultaneously, the mastery of the product over the producer. Anarchy in social production is replaced by systematic, definite organisation. The struggle for individual existence disappears.

Then for the first time man, in a certain sense, is finally marked off from the rest of the animal kingdom, and emerges from mere animal conditions of existence into really human ones.

The whole sphere of the conditions of life which environ man, and which have hitherto ruled man, now comes under the dominion and control of man who for the first time becomes the real, conscious lord of nature because he has now become master of his own social organisation.

Friedrich Engels, from Anti-Dühring, part 3, chapter 2 (1877)

Wobbly Times number 41

Professor Richard Wolff, who works at the University of Massachusetts, tells it like it is. I should explain that my conception of socialism is a little more defined. Socialism is the common ownership of the means of production under the direct control of the producers in a classless (and therefore Stateless) society. Wolff implies as much at the end of his lecture. What he doesn't mention about socialism from the Marxian informed position is the total abolition of wage-labour; production for use and need and the abolition of commodity production, all of which, I think, are absolutely necessary to sustain socialism.

Take forty minutes from your daily life and watch this very erudite lecture. After you've finished, you'll know a hell of a lot more than almost anyone else about what's basically going on now.

Wobbly Times number 2

$80 billion to AIG

who does it go to

Goldman

Bank of America

Deutsche Bank

UBS

Chase

creditors all

flowing on

into the coffers

transfer of wealth

the usual game

it's the wage system

we all pay the price

well most of us anyway

for selling ourselves

into wage-slavery

and all

losing control

of the wealth we create

We sit here and wonder

what is our fate

when it's all done and dusted

by their goddam State.