[ Section Two] [ Circulation Process of Capital]

[ Reproduction and Accumulation of Capital]

We have now seen how, by means of the valorisation process, capital has (1) maintained its value by means of exchange (i.e. exchange with living labour); (2) increased, produced surplus value. There now appears, as the result of this unity of the production and valorisation process, the product of the process, i.e. capital itself, as it emerges as the product of the process whose precondition it was — as a product which is value. Or value itself appears as the product of this process, but a higher value, because more objectified labour is contained in it than in that from which the process originally set out. This value as such is money. However, this is the case only in itself; it is not posited as such. What is initially posited, what is actually there, is a commodity of a certain (ideal) price, i.e. a commodity which exists only in idea in the form of a certain sum of money, and which can be realised as such only in exchange, i.e. it must first re-enter the process of simple circulation in order to be posited as money. Hence we arrive at the third side of the process in which capital is posited as such.

(3) Strictly considered, the valorisation process of capital — and it is only by means of the valorisation process that money becomes capital — appears at the same time as its devaluation process, ITS DEMONETISATION. And this in two respects. Firstly, in so far as capital does not increase absolute labour time, but reduces relative necessary labour time by increasing productive power, it reduces its own cost of production, i.e. in so far as it was presupposed as a definite sum of commodities, it reduces its exchange value. A part of the existing capital is continually devalued by the reduction of the costs of production at which it can be reproduced; by the reduction not of the labour objectified in it, but of the living labour which it is now necessary to objectify in this specific product.

This constant [IV-16] devaluation of existing capital does not belong here, because it presupposes capital as completed. It is to be noted here only in order to indicate how later developments are already contained in the general concept of capital. Belongs to the doctrine of concentration and competition of capitals.

The devaluation being dealt with here, is that capital has made the transition from the form of money to that of a commodity, of a product which has a certain price, which is to be realised. As money, it existed as value. Now it exists as product and only in idea as price; but not as value as such. In order to valorise itself, i.e. to preserve and to multiply itself as value, it would first have to make the transition from the form of money into that of use values (raw material — instrument — wages). But in doing so it would lose its form as value. It now has to re-enter circulation in order to posit this form of general wealth anew. No longer does the capitalist enter into the circulation process merely as an exchanger; he does so now as a producer confronting the other exchangers as consumers. They are to exchange money to obtain his commodity for their consumption, while he exchanges his product in order to obtain their money. If this process miscarries — and the very separation [of producers and consumers] entails the possibility of miscarriage in the individual case — the money of the capitalist has been transformed into a worthless product; not only has it not gained any new value, it has lost its original value.

But whether this is so or not, the devaluation of capital constitutes a moment of its valorisation process. This is already inherent in the simple fact that the product of the process in its immediate form is not value, but must first re-enter circulation to be realised as such. Hence, if capital is reproduced as value and new value by means of the production process, it is simultaneously posited as non-value, something still to be valorised by means of exchange.

The three processes [maintenance of the value of the capital employed, valorisation, realisation of the value of the product] whose unity is formed by capital are external to one another, separate in time and space. As such, the transition from one to the other, i.e. their unity in relation to the individual capitalists, is fortuitous. They exist independently alongside one another, despite their inner unity, and each exists as the precondition of the other. Over the whole range of production it must assert itself, in so far as the whole of production is based on capital, and capital must therefore realise all the necessary moments of its self-formation and contain the conditions for the realisation of these moments. At the point which we have reached so far, capital does not yet appear as determining circulation (exchange) itself, but merely as a moment of circulation and ceasing to be capital precisely at the point where it enters into circulation. As commodity in general, capital now shares the fate of commodities in general; it becomes a matter of chance, whether or not it is exchanged for money, whether or not its price is realised.

In the production process itself — where capital always remained presupposed as value — its valorisation appeared to be entirely dependent upon its relationship as objectified labour to living labour, i.e. upon the relationship of capital to wage labour. But now as product, as commodity, it appears dependent on circulation, which lies outside the production process. (In fact, as we have seen,a it returns into that process as its ground, but just as much re-emerges from it.) As a commodity, it must be (1) use value, and as such object of need, object of consumption; (2) exchanged for its equivalent — in money. Only through a sale can the new value be realised.

If the capital previously contained objectified labour at a price of 100 thaler, and now does so at a price of 110 (the price merely expressing in money the volume of objectified labour), this has to come out in the fact that the objectified labour now contained in the produced commodity exchanges for 110 thaler. To start with, the product is devalued in so far as it must be exchanged for money at all in order to regain its form as value.

Within the production process the valorisation appeared to be completely identical with the production of surplus labour (the objectification of surplus time), and thus without any limits other than those which are partly presupposed and partly posited within this process itself, but always posited within it as barriers to be overcome.

But now barriers appear which lie outside the process. To start with, considered quite superficially, the commodity is exchange value only in so far as it is simultaneously use value, i.e. object of consumption (what kind of consumption, still quite irrelevant here). It ceases to be exchange value if it ceases to be use value (since it does not as yet exist again as money but in a specific mode of being coinciding with its natural quality).

The first barrier [it runs up against] is therefore consumption itself — the demand for it. (Within the assumptions so far made, there can be no question of an ineffective demand, i.e. a demand not backed up by a commodity or money to be given in exchange [IV-17] for the commodity demanded.) Secondly, however, an equivalent for the commodity must be available, and since circulation was originally presupposed as a fixed magnitude, as having a given volume, while capital has produced a new value in the production process, it appears that there can in fact be no equivalent available for it.

Hence, when capital emerges from the production process and returns into circulation, it appears

(a) that as production it has come up against the barrier of the given volume of consumption, or of the consumption capacity. As a specific use value, its quantity is to some extent irrelevant. But at a certain level it ceases to be required for consumption — since it satisfies only a specific need. As a particular, one-sided, qualitative use value, e.g. as grain, its quantity itself is irrelevant only to a certain degree; it is required only in a specific quantity, i.e. in a certain measure. But this measure is given partly by the quality of the commodity as use value — its specific utility, usability — and partly by the number of exchangers who have a need for this particular object of consumption. The number of consumers multiplied by the size of their demand for this specific product. Use value in itself does not possess the boundlessness of value as such. Certain objects can be consumed and are the objects of demand only to a certain degree. E.g. only a definite quantity of grain, etc., is consumed. As use value, the product accordingly has a barrier within itself — precisely that of the demand for it — but this barrier is now measured not by the need of the producer but by the aggregate demand of the exchangers. At the point where the demand for a certain use value ceases, it ceases to be use value. As use value it is measured by the demand for it. As soon as it ceases to be use value, it ceases to be an object of circulation (in so far as it is not money).

(b) As new value and value as such, capital appears to come up against the barrier of the volume of available equivalents, in the first place of money — money not as means of circulation but as money. Surplus value (the surplus over and above the original value) requires a surplus equivalent. This now appears as the second barrier.

(c) Originally, money — i.e. wealth as such, wealth existing in and through exchange for alien objectified labour—appeared to collapse into itself, in so far as it did not proceed to the exchange for alien living labour, i.e. to the production process. Circulation was incapable of renewing itself from within itself. On the other hand, the production process now appears to be IN A FIX, if it cannot make the transition into the process of circulation. Capital as production based on wage labour presupposes circulation as a necessary condition and moment of the entire movement. This specific form of production presupposes the specific form of exchange which finds its expression in money circulation. If the process is to be renewed, the whole product must be converted into money; not as in earlier stages of production, where exchange embraces only superfluous production and superfluous products, but not production in its totality.

These are the contradictions which cannot escape a simple, objective, impartial examination. How they are constantly transcended in production based on capital, yet constantly reproduced, and only forcibly transcended (although up to a certain point this transcendence appears merely as a smooth adjustment), is another question. For the moment, the important thing is to take note of the existence of these contradictions. All the contradictions of [simple commodity] circulation come to life again in a new form. The product as use value is in contradiction to itself as value; i.e. in so far as it exists in a specific quality, as a specific thing, as a product possessing specific natural properties, as a substance of need in contradiction with the substance which as value it possesses exclusively in the labour objectified in it. But this time the contradiction is no longer posited as a purely formal difference, as in [simple] circulation. Being measured by use value is here tantamount to being measured by the aggregate demand of the exchangers for this product, i.e. by the amount of total consumption.

This appears here as the measure for the product as use value and therefore also as exchange value. In simple circulation the product simply had to be transposed from the form of the particular use value to that of exchange value. Its barrier was merely that, as use value, it existed in a particular form because of its natural properties, rather than in the value form in which it was directly exchangeable for all other commodities. But now it is posited that the measure of its availability is actually given in its natural properties. If it is to be transposed into the general form, the use value must be present only in a specific quantity; a quantity the measure of which does not lie in the labour objectified in it, but arises from its nature as use value, that is to say as use value for others.

At the same time, the previous contradiction that the money existing for itself [IV-18] had to proceed to its exchange for living labour, appears even greater now, because the surplus money, in order to exist as such, or the surplus value, has to be exchanged for surplus value. Hence, as value, it comes up against a barrier in the production of others, just as, as use value, it comes up against a barrier in the consumption of others. As use value, its measure is the size of the demand for the specific product; as value, its measure is the amount of objectified labour existing in circulation. The indifference of value as such towards use value is thereby brought into just as false a position as are, on the other side, the substance and measure of value as objectified labour in general.

/ A s yet we cannot go on to the relationship of demand, supply, prices, for they presuppose capital in their characteristic development. In so far as demand and supply are abstract categories, not as yet expressing any particular economic relationships, they should perhaps be considered along with simple circulation or production?/

The main point here, where we are concerned with the general concept of capital, is that capital is this unity of production and valorisation not immediately but only as a process tied to certain conditions, and, as it appeared, external conditions.

/ W e have already seen how the valorisation process of capital presupposes the prior development of the simple production process? This will be the case with demand and supply in so far as in simple exchange a need for the product is presupposed. The (immediate) producer's own need as a need for the demand of others. In the course of this development it will appear of itself what has to be presupposed to this demand, and all this is then to be thrown into the first chapters./

Capital's creation of absolute surplus value—more objectified labour — is conditional upon the expansion, indeed the constant expansion, of the periphery of circulation. The surplus value produced at one point requires the production of surplus value at another point, for which it may be exchanged. Initially the production of more gold and silver, more money, will suffice so that, if the surplus value cannot directly become capital again, it can exist in the form of money as the possibility of new capital. A condition of production based on capital is therefore the production of a constantly expanding periphery of circulation, whether the sphere

See this volume, pp. 230-66.— Ed.

is directly expanded, or whether more points within it become points of production.

If circulation initially appeared as a given magnitude, it appears here as a moving one, expanding through production itself. In the light of this, it already appears itself as a moment of production. Hence, just as capital has the tendency to produce ever more surplus labour, it has the complementary tendency to produce more points of exchange. With respect to absolute surplus value or surplus labour, this means that capital tends to generate more surplus labour as complement to itself; au fond, that it tends to propagate production based on capital or the mode of production corresponding to it. The tendency to create the world market is inherent directly in the concept of capital itself. Every limit appears as a barrier to be overcome. At first [capital strives] to subject each moment of production itself to exchange, and to transcend the production of immediate use values which do not enter into exchange, i.e. to replace the earlier and from its standpoint naturally evolved modes of production by production based on capital. Trade appears no longer as an activity carried on between independent productions for the exchange of their surplus product, but as the essential, all-embracing prerequisite for and moment of production itself.

OF COURSE, all production directed towards the creation of immediate use values reduces the number of exchangers just as much as it does the sum of exchange values thrown into circulation, and above all the production of surplus values. HENCE

THE TENDENCY OF CAPITAL ( 1 ) TO CONTINUALLY ENLARGE THE PERIPHERY OF CIRCULA-

TION; ( 2 ) TO TRANSFORM IT AT ALL POINTS INTO PRODUCTION CARRIED ON BY CAPITAL.

On the other side, the production of relative surplus value, i.e. the production of surplus value based upon the increase and development of the productive forces, requires production of new consumption, so that the sphere of consumption within circulation is enlarged, as that of production [of absolute surplus value] was enlarged before. Firstly, quantitative increase in existing consumption; secondly, the creation of new needs by the propagation of existing ones over a wider area; thirdly, production of new needs and discovery and creation of new use values. In other words, it requires that the surplus labour obtained does not remain a merely quantitative surplus, but that at the same time the range of qualitatively distinct types of labour (including surplus labour) must be constantly extended, rendered more diverse, and internally differentiated.

E.g. if because of a doubling of productivity, a capital of only 50 needs to be invested where 100 was needed before, and a capital of 50 and the necessary labour corresponding to it are released, [IV-19] a new, qualitatively different branch of production satisfying and generating a new need, must be created for the released capital and labour. The value of the old industry is preserved [by] the creation of a FUND for a new industry, in which the relation of capital and LABOUR establishes itself in a new form.

Hence the exploration of the whole of nature in order to discover new useful properties of things; the universal exchange of the products coming from the most diverse climates and lands; new (artificial) modes of processing natural objects to give them new use values. ^ The role played by luxury in antiquity in contrast to its role in modern times, TO BE ALLUDED TO later.^ The all-round exploration of the earth to discover both new useful objects and new uses for old objects, such as their use as raw materials, etc.; hence the development of the natural sciences to their highest point; the discovery, creation and satisfaction of new needs arising from society itself; cultivating all the qualities of social man and producing him in a form as rich as possible in needs because rich in qualities and relations — producing man as the most total and universal social product possible (for in order to enjoy many different kinds of things he must be capable of enjoyment, that is he must be cultivated to a high degree)—all these are also conditions of production based on capital. This creation of new branches of production, i.e. qualitatively new surplus time, is not only the division of labour, but also the separation of a definite kind of production from itself as labour of a new use value; the development of a constantly expanding comprehensive system of different kinds of labour, different kinds of production, with a corresponding system of ever more extended and ever more varied needs.

Thus, just as production based on capital produces universal industry, i.e. surplus labour, value-creating labour, on the one hand, so does it on the other produce a system of universal exploitation of natural and human qualities, a system of universal utility, whose bearer is science itself as much as all the physical and spiritual qualities, and under these conditions nothing appears as something higher-in-itself, as an end in itself, outside this circle of social production and exchange. Thus it is only capital which creates bourgeois society and the universal appropriation of nature and of the social nexus itself by the members of society. HENCE THE GREAT CIVILISING INFLUENCE OF CAPITAL; hence its production of a stage of society compared to which all previous stages seem merely local developments of humanity and idolatry of nature. For the first time, nature becomes purely an object for men, nothing more than a matter of utility. It ceases to be acknowledged as a power for itself, and even the theoretical cognition of its autonomous laws appears merely as a stratagem for its subjection to human needs, whether as object of consumption or as means of production. It is this same tendency which makes capital drive beyond national boundaries and prejudices and, equally, beyond nature worship, as well as beyond the traditional satisfaction of existing needs and the reproduction of old ways of life confined within long-established and complacently accepted limits. Capital is destructive towards, and constantly revolutionises, all this, tearing down all barriers which impede the development of the productive forces, the extension of the range of needs, the differentiation of production, and the exploitation and exchange of all natural and spiritual powers.

But from the fact that capital posits every such limit as a barrier which it has ideally already overcome, it does not at all follow that capital has really overcome it; and since every such limit contradicts the determination of capital, its production is subject to contradictions which are constantly overcome but just as constantly posited. Moreover, the universality for which capital ceaselessly strives, comes up against barriers in capital's own nature, barriers which at a certain stage of its development will allow it to be recognised as being itself the greatest barrier in the way of this tendency, and will therefore drive towards its transcendence through itself.

The economists who, like Ricardo, conceive production as directly identical with the self-valorisation of capital, who therefore ignore the barriers of consumption or the existing barriers of circulation itself, so far as circulation must represent counter-values at all points, and who are only concerned with the development of the productive forces and the growth of the industrial population — i.e. with supply, regardless of demand— have therefore grasped the positive essence of capital more correctly and profoundly than those who, like Sismondi, emphasise the barriers of consumption and of the existing circle of counter-values, although the latter has better grasped the limitations of production based on capital, its negative one-sidedness. Ricardo has better grasped its universal tendency, Sismondi its particular restrictedness.

The whole controversy as to whether overproduction is possible and necessary in production based on capital, is about whether the valorisation of capital in production directly posits its valorisation in circulation; whether its [IV-20] valorisation posited in the production process is its real valorisation. Ricardo of course also has A SUSPICION that exchange value is not value outside exchange, and that it proves itself as value only through exchange. But he considers the barriers which production encounters in this direction as accidental, as barriers which are simply overcome. He therefore conceives the overcoming of such barriers as implied in the very essence of capital, although his exposition of this is often absurd. Sismondi, by contrast, emphasises not only the encounter-ing of the barrier but its creation by capital itself, which thus gets itself into contradictions, contradictions in which he glimpses the impending BREAKDOWN of capital. He therefore wants to impose barriers on production from outside, by means of custom, laws, etc., which, as merely external and artificial constraints, would necessarily be demolished by capital. On the other hand, Ricardo and his entire school have never comprehended the real modern crises in which this contradiction of capital discharges itself in violent thunderstorms, which more and more threaten capital itself as the basis of society and production.

The attempts made from the orthodox economic standpoint to deny the fact of general overproduction at a given moment are indeed childish. To rescue production based on capital, the orthodox economists (see e.g. MacCullocha) either ignore all its specific characteristics, all its conceptual definitions, and rather conceive of it as simple production for immediate use value. [They] entirely abstract from its essential relations. IN FACT, to purify it of contradictions, they simply drop it and negate it. Or, like e.g. Mill, they adopt a more perceptive procedure (insipidly imitated by Say): supply and demand are identical, hence they must correspond to each other. For supply is really a demand, measured by its [supply's] own amount.^[123]

Here a great confusion: (1) the identity of supply, i.e. being a demand which is measured by its [supply's] own amount, is true only to the extent that it is exchange value = a certain amount of objectified labour. To that extent, supply is the measure of its own demand as far as value is concerned. But as such a value, it is realised only through exchange for money; and as an object of exchange for money it depends upon (2) its use value; and as use

a J. R. MacCulloch, The Principles of Political Economy, Edinburgh, 1825, p. 190.— Ed.

b J. Mill, Elements d'économie politique, Paris, 1823, pp. 250-60.— Ed.

value, in turn, it depends upon the mass of existing needs for it, the demand for it. However, as use value it is absolutely not measured by the labour time objectified in it, but by a standard quite unconnected with its nature as exchange value.

Or else it is asserted that supply itself is a demand for a certain product of a certain value (which is expressed in terms of the required amount of the product). If, therefore, the product supplied cannot be sold, this proves only that too much of the commodity supplied and too little of some other commodity, demanded by the supplier, has been produced. Thus, allegedly, there is no general overproduction, only overproduction of one or some articles, but underproduction of others. What is forgotten here is the fact that producing capital demands not a particular use value but value for itself, i.e. money — money not in its role as means of circulation but as the general form of wealth, or as the form of the realisation of capital in one respect, and return to its original dormant state in the other.

The assertion that too little money is being produced is tantamount to the assertion that production does not coincide with valorisation, hence is overproduction; or, which is the same thing, that it is production which cannot be converted into money, hence into value, production which does not pass the test of circulation. HENCE THE ILLUSION of the money-conjurers (also Proudhon, etc.) that there is a shortage of means of circulation because of the dearness of money, and that more money has to be created artificially. (See also the Birmingham School, e.g. the Gemini.^[124])

Or it is said that, considered from the social standpoint, production and consumption are identical; therefore an excess of one in relation to the other or a disproportion between them can never occur. The "social standpoint" here referred to is precisely the abstraction which ignores the specific social structure and relations and hence also the contradictions arising from them. Already

Storch, for example, argued very correctly against Say⁽¹⁾ that a large part of consumption is not consumption for immediate use but consumption within the production process, e.g. consumption of machines, coal, oil, necessary buildings, etc.^[14] This type of consumption [IV-21] is not at all identical with the consumption which is being discussed here. Similarly, Malthus and Sismondi have correctly observed that e.g. the consumption of the workers is by no means in itself a sufficient consumption for the capitalist.⁽²⁾

The moment of valorisation is here completely excluded, and production and consumption simply counterposed to each other, i.e. a production based directly on use value, and hence not on capital, is presupposed.

Or in socialist jargon: let labour and the exchange of labour, i.e. production and exchange of the product (circulation), be the whole process. How could a disproportion then arise, except by an oversight or a miscalculation? Labour is not conceived here as wage labour, nor capital as capital. On the one hand, the consequences of production based on capital are taken for granted; on the other hand, the requisite and condition of these consequences is denied — necessary labour as labour posited by and for surplus labour.

Or — e.g. Ricardo⁽³⁾—since production is itself regulated by the costs of production, it regulates itself. And if a particular branch of production does not valorise itself, capital withdraws from it to a certain degree and moves into other branches in which it is necessary. But, quite apart from the fact that the very necessity of evening-up presupposes the imbalance, the disharmony and hence the contradiction, in a general crisis of overproduction the contradiction is not between different types of productive capital, but between industrial and loan capital, between capital as it is directly involved in the production process and capital as it appears as money independently (relativement) outside that process.

Finally, PROPORTIONATE PRODUCTION⁽⁴⁾ (this also already in Ricardo, etc.). But if it is the tendency of capital to distribute itself in the correct proportions, it is just as much its necessary tendency to drive beyond the correct proportion, because it strives boundlessly for surplus labour, surplus productivity, surplus consumption, etc.

(In competition, this immanent tendency of capital appears as a compulsion imposed upon it by other capital and driving it beyond the correct proportion with a constant March, march! As Mr. Wakefield correctly sniffs out in his commentary on Smith,⁽⁵⁾ free competition has never been analysed at all by political economists, however much they may chatter about it, even though it is the basis of the entire bourgeois production based on capital. It has only been understood negatively, i.e. as the negation of monopolies, corporations, legal regulations, etc., and as the negation of feudal production. But, after all, it must also be something for itself, since a mere 0 is an empty negation, an abstraction from a barrier which is immediately resurrected e.g. in the form of monopoly, natural monopolies, etc. Conceptually, competition is nothing but the inner nature of capital, its essential character, manifested and realised as the reciprocal action of many capitals upon each other; immanent tendency realised as external necessity.) (Capital exists and can only exist as many capitals; hence its own character appears as their reciprocal action on each other.)

Capital is just as much the constant positing of, as it is the constant transcendence of PROPORTIONATE PRODUCTION. The existing proportions must constantly be transcended through the creation of surplus values and the increase of productive forces. But to demand that production should be expanded instantaneously, SIMULTANEOUSLY and in the same proportions, is to impose external demands on capital, which in no way correspond to anything arising from capital itself. In fact, the departure from the given proportion in one branch of production drives all the other branches out of that proportion, and at unequal rates. So far (for we have not yet reached capital in its character as capital circulant; we still have circulation on one side and capital on the other, or production as the premiss of circulation or the ground from which it arises), even from the standpoint of production, circulation has the relation to consumption and production, in other words, surplus labour as counter-value, and differentiation of labour in ever richer variety.

The simple concept of capital must contain in itself its civilising tendencies, etc. They must not be presented, as they are up to now in political economy, as merely external consequences. Similarly, the contradictions which are later released, must be demonstrated as already latent within it.

So far, we have in the valorisation process only the indifference of the individual moments to each other, that they determine each other internally and search for each other externally, but that they may or may not find each other, balance each other, correspond to each other. The necessary inner connection of moments belonging together and their mutually indifferent, independent existence are already a foundation [IV-22] of contradictions.

However, we have by no means finished yet. The contradiction between production and valorisation — of which capital, according to its concept, is the unity — has to be grasped more intrinsically than merely as the mutually indifferent and apparently independent appearance of the individual moments of the process or, rather, of the totality of processes.

To get closer to the point: d'abord THERE IS A LIMIT, NOT INHERENT TO

PRODUCTION GENERALLY, BUT TO PRODUCTION FOUNDED ON CAPITAL. T h i s LIMIT i s two-fold, or rather it is the same limit considered from two different aspects. Here it is sufficient to demonstrate that capital contains a particular restriction on production — which contradicts its general tendency to drive beyond every barrier to production— to have uncovered the foundation of overproduction, the basic contradiction of developed capital; or, to put it more generally, to have uncovered that capital is not, as the economists believe, the absolute form for the development of the productive forces — not the absolute form for that, nor the form of wealth which absolutely coincides with the development of the productive forces.

The stages of production which precede capital appear, when looked at from the standpoint of capital, as just so many fetters upon the productive forces. But capital itself, correctly understood, appears as the condition for the development of the productive forces only so long as they require an external spur, a spur which at the same time appears as their bridle. It is a discipline over them, which at a certain level of their development becomes quite as superfluous and burdensome as [previously] the corporations, etc. These inherent limits must coincide with the nature of capital, with the essential character of its very concept. These necessary LIMITS are:

(1) necessary labour as the limit on the exchange value of living labour capacity or on the wages of the industrial population;

(2) surplus value as the limit on surplus labour time; and, with respect to relative surplus labour time, as the limit on the development of .the productive forces;

(3) what is the same, transformation into money, exchange value in general as the limit on production; or exchange based on value, or value based on exchange, as the limit on production. It is:

(4) again identical as the restriction of the production of use values by exchange value; or that real wealth has to assume a specific form distinct from itself, i.e. a form not absolutely identical with itself, if it is to become an object of production at all.

On the other hand, it arises from the general tendency of capital (and this is what in simple circulation was manifest in the fact that money as a means of circulation appeared only fleetingly, devoid of independent necessity, and hence not as a limit and barrier) that it forgets and abstracts from:

(1) necessary labour as the limit on the exchange value of living labour capacity; (2) surplus value as the limit on surplus labour and the development of the productive forces; (3) money as the limit on production; (4) the restriction of the production of use values by exchange value.

Hinc overproduction, i.e. a sudden reminder of all these necessary moments of production based on capital; hence general devaluation in consequence of forgetting them. This immediately faces capital with the task of trying again from a higher level of development of the productive forces, etc., resulting in an ever greater COLLAPSE as capital. Therefore clear that the higher the level to which capital has developed, the more it appears as a barrier to production — hence also to consumption — quite apart from the other contradictions which make it appear as a burdensome barrier on production and commerce.

^ T h e whole credit system, and the OVER-TRADING, OVER-SPECULATION, etc., connected with it, rest upon the necessity to extend the range of, and to overcome the barrier to, circulation and exchange. This appears more colossal, more classical, in the relationship between peoples than in the relationship between individuals. Thus e.g. Englishmen compelled to lend to foreign nations to have them as their CUSTOMERS. AU fond, the English capitalist carries on a two-fold exchange with productive English capital: (1) as himself, (2) as Yankee, etc., or in whatever other form he has placed his money .^ ^Capital as a barrier to production is hinted at in e.g. Hodgskin:

"IN THE PRESENT STATE, EVERY ACCUMULATION OF CAPITAL ADDS TO THE AMOUNT

OF PROFIT DEMANDED FROM THE LABOURER, AND EXTINGUISHES ALL THAT LABOUR WHICH WOULD ONLY PROCURE THE LABOURER HIS COMFORTABLE EXISTENCE... PROFIT THE LIMITATION OF PRODUCTION" [Th. Hodgskin, Popular Political Economy, London, 1827, pp. 245, 246] (IX, p. 46).^[125]

By means of FOREIGN TRADE the limit on the sphere of exchange is extended and capitalists are enabled to consume more surplus labour:

"IN A SERIES OF YEARS THE WORLD CAN TAKE NO MORE FROM US, THAN WE CAN TAKE FROM THE WORLD. EVEN THE PROFITS MADE BY OUR MERCHANTS IN THEIR FOREIGN TRADE ARE PAID BY THE CONSUMER OF THE RETURN GOODS HERE. FOREIGN TRADE MERE BARTER, AND AS SUCH EXCHANGE FOR THE CONVENIENCE AND ENJOYMENT OF THE

13* CAPITALIST. [ I V - 2 3 ] B U T HE CAN CONSUME COMMODITIES TO A CERTAIN DEGREE ONLY.

H E EXCHANGES COTTONS ETC. FOR THE WINES AND SILKS OF FOREIGN COUNTRIES. B U T

THESE REPRESENT ONLY THE SURPLUS LABOUR OF OUR OWN POPULATION AS MUCH AS THE

CLOTHES AND COTTONS, AND IN THIS WAY THE DESTRUCTIVE POWER OF THE CAPITALIST

IS INCREASED BEYOND ALL BOUNDS. T H U S NATURE IS OUTWITTED" ([The] Source and Remedy [of the National Difficulties, pp. 17-18,] p p . 27, 28). To what extent GLUT is connected with the barrier of necessary labour:

" T H E VERY MEANING OF AN INCREASED DEMAND [ f o r w o r k ] BY THE LABOURERS IS A

DISPOSITION TO TAKE LESS THEMSELVES, AND LEAVE A LARGER SHARE FOR THEIR

EMPLOYERS; AND IF IT BE SAID THAT THIS, BY DIMINISHING CONSUMPTION, INCREASES GLUT, I CAN ONLY SAY THAT GLUT THEN IS SYNONYMOUS WITH HIGH PROFITS" (Enquiry, etc., [An Inquiry into those Principles, respecting the Nature of Demand and the Necessity of Consumption, lately advocated by Mr. Malthus,] London, 1821, [p. 59] p. 12 1 2 6). Herein the one aspect of the contradiction fully expressed.

" T H E PRACTICE O F STOPPING LABOUR AT T H A T POINT WHERE I T CAN PRODUCE, IN

ADDITION T O T H E SUBSISTENCE O F T H E LABOURER, A PROFIT FOR T H E CAPITALIST,

OPPOSED TO THE NATURAL LAW WHICH REGULATES PRODUCTION" ( Hodgskin , [ o p . cit., p. 238,] 41,127 IX).

" T H E MORE T H E CAPITAL ACCUMULATES, T H E WHOLE AMOUNT OF PROFIT DEMANDED

DOES SO; SO THERE ARISES AN ARTIFICIAL CHECK T O PRODUCTION AND POPULATION" (Hodgskin, [op. cit., p. 246,] 46).

The contradictions between capital as instrument of production in general and instrument of production of VALUE are developed by Malthus thus (IX, 40 ff):

" P R O F I T S ARE INVARIABLY MEASURED BY VALUE AND NEVER BY QUANTITY... T H E

WEALTH O F A COUNTRY DEPENDS PARTLY UPON T H E QUANTITY OF PRODUCE OBTAINED BY

ITS LABOUR, AND PARTLY UPON SUCH AN ADAPTATION OF THIS QUANTITY TO THE WANTS

AND POWERS OF THE EXISTING POPULATION AS IS CALCULATED T O GIVE I T VALUE.

N O T H I N G CAN BE MORE CERTAIN T H A N T H A T I T IS N O T DETERMINED BY EITHER OF THEM

ALONE. B U T WHERE WEALTH AND VALUE ARE PERHAPS T H E MOST NEARLY CONNECTED, IS

IN THE NECESSITY OF THE LATTER TO THE PRODUCTION OF THE FORMER. T H E VALUE SET

UPON COMMODITIES, T H A T IS T H E SACRIFICE OF LABOUR WHICH PEOPLE ARE WILLING T O

MAKE IN ORDER T O OBTAIN THEM, IN T H E ACTUAL STATE O F THINGS MAY BE SAID T O BE

ALMOST THE SOLE CAUSE O F T H E EXISTENCE O F WEALTH... T H E CONSUMPTION AND

DEMAND OCCASIONED ONLY BY T H E WORKMEN EMPLOYED IN PRODUCTIVE LABOUR CAN

NEVER ALONE FURNISH A MOTIVE T O T H E ACCUMULATION AND EMPLOYMENT OF CAPITAL

... T H E POWERS OF PRODUCTION ALONE DO NOT SECURE THE CREATION OF A PROPORTION-

ATE DEGREE OF WEALTH, AS LITTLE AS THE INCREASE OF POPULATION. W h a t it r e q u i r e s in addition is SUCH A DISTRIBUTION OF PRODUCE, AND SUCH AN ADAPTATION O F T H I S

PRODUCE TO THE WANTS OF THOSE WHO ARE TO CONSUME IT, AS CONSTANTLY TO INCREASE THE EXCHANGEABLE VALUE OF THE WHOLE MASS, I.E. THE POWERS OF PRODUCTION ARE ONLY CALLED FULLY INTO ACTION BY THE UNCHECKED DEMAND FOR

ALL T H A T is PRODUCED..." [Principles of Political Economy, 2nd ed., London , 1836, pp. 266, 301, 302, 315, 361, 311 and 361].

True, this is brought about on the one hand by constant establishment of new branches of industry (and reciprocal expansion of the old), by means of which the old obtain new MARKETS, etc. Production does indeed create DEMAND in that it employs more labourers in the same branch of business and creates new branches of business, in which new capitalists employ new labourers and at the same time reciprocally become a market for the old; but

" T H E DEMAND CREATED BY T H E PRODUCTIVE LABOURER HIMSELF CAN NEVER BE AN

ADEQUATE DEMAND, BECAUSE IT DOES N O T GO T O T H E FULL EXTENT O F W H A T HE PRODUCES. IF IT DID, THERE WOULD BE NO PROFIT, CONSEQUEN FLY NO MOTIVE TO EMPLOY HIM. THE VERY EXISTENCE OF A PROFIT UPON ANY COMMODITY PRESUPPOSES A DEMAND EXTERIOR TO THAT OF THE LABOUR WHICH HAS PRODUCED IT" [ibid., p. 405, publisher's note]. " B O T H LABOURERS AND CAPITAL MAY BE REDUNDANT COMPARED WITH THE MEANS OF EMPLOYING THEM PROFITABLY" [ibid., p. 414, n o t e ] . . /

/ T o be noted for (3),a to which we shall soon proceed, that the preliminary accumulation, which is the form in which capital appears in relation to labour, and by means of which it is COMMAND over it, is initially nothing but SURPLUS LABOUR itself in the form of SURPLUS PRODUCE, and on the other hand a draft on the COEXISTING LABOUR1' of others.^ O F COURSE, the point here is not yet to analyse overproduction in all its specific characteristics, but only the predisposition to it as it is posited in primitive form in the relation of capital itself. We must therefore also omit the other possessing and consuming classes, etc., which do not produce but live from their revenue, and therefore exchange with capital, constitute centres of exchange for it. We can take them partly into account only in so far as they play a MOSI IMPORTANT role in the historical formation of capital (but they are better dealt with in connection with accumulation).

In production based on slavery, and similarly in patriarchal rural-industrial production, where the great majority of the population satisfies most of its needs directly by its labour, the sphere of circulation and exchange is very narrow; and particularly in the first, the slave does not come into consideration at all as an exchanger. But in production based on capital, consumption is at all points mediated by exchange, and labour never has direct use value for those who perform it. Its [IV-24] whole basis is labour as exchange value and as producer of exchange value.

WELL. D'abord the wage worker, as distinct from the slave, is himself an independent centre of circulation, someone who exchanges, posits

a See this volume, p p . 245-46.— Ed. h An expression from Hodgskin's anonymously published book Labour Defended against the Claims of Capital, London, 1825.— Ed.

exchange value and maintains exchange value by means of exchange. Firstly: Through the exchange between the part of capital which is determined as wages and his living labour capacity, the exchange value of this part of capital is directly posited before capital again steps out of the production process to enter into circulation; or this may itself be conceived of as an act of circulation. Secondly: In relation to each capitalist the total mass of all workers except his own appears not as workers but as consumers, possessors of exchange values (wages), of money, which they exchange for his commodities. They are so many centres of circulation, from which the act of exchange begins and by means of which the exchange value of capital is preserved. They constitute a very large proportion of consumers, although NOT QUITE so GREAT AS is GENERALLY IMAGINED if one thinks only of the industrial workers proper. The greater their number — the greater the size of the industrial population — and the greater the amount of money over which they dispose, the greater the sphere of exchange for capital. We have seen that it is the tendency of capital to increase the industrial population as much as possible.⁽⁶⁾

Actually, we are not at all concerned here yet with the relationship of one capitalist to the workers of other capitalists. It only shows the illusion of each capitalist, but does not alter the relationship of capital in general to labour. Each capitalist knows that he does not confront his own worker as a producer confronts a consumer, and so he wants to restrict his consumption, i.e. his ability to exchange, his wages, as much as possible. But of course, he wants the workers of other capitalists to be the greatest possible consumers of his commodity. Yet the relationship of each capitalist to his workers is the general relationship of capital and labour, the essential relation. It is precisely this which gives rise to the illusion — true for each individual capitalist as distinct from all the others — that apart from his own workers, the rest of the working class confronts him not as workers, but as consumers and exchangers—as money spenders. It is forgotten that, as Malthus says,

" T H E VERY EXISTENCE OF A PROFIT UPON ANY COMMODITY PRESUPPOSES A DEMAND EXTERIOR TO THAT OF THE LABOURER WHO HAS PRODUCED IT", a n d h e n c e t h e "DEMAND OF THE LABOURER HIMSELF CAN NEVER BE AN ADEQUATE DEMAND" [Principles of Political Economy, 2nd ed., London, 1836, p. 405, publisher's note].

Since one production sets another production in motion and hence creates consumers for itself in the alien capital's workers,

[ Forms Preceding Capitalist Production]^{[1 3 3]}

One of the prerequisites of wage labour and one of the historical conditions for capital is free labour and the exchange of free labour for money, in order to reproduce money and to valorise it, in order to be consumed by money, not as use value for enjoyment, but as use value for money. Another prerequisite is the separation of free labour from the objective conditions of its realisation — from the means and material of labour. This means above all separation of the worker from the land, which functions as his natural workshop, hence the dissolution both of free small holdings and of communal landed property, based on the Oriental commune.

In both these forms the labourer relates to the objective conditions of his labour as to his property; this is the natural unity of labour with its physical prerequisites. Hence the labourer has an objective existence independent of his labour. The individual relates to himself as proprietor, as master [IV-51] of the conditions of his reality. He relates in the same way to the others, and — depending on whether this prerequisite derives from the community or from the individual families constituting the community — he relates to the others as co-proprietors, as so many incarnations of the common property, or as independent proprietors coexisting with him, independent private proprietors, beside whom the common property which formerly absorbed everything and embraced them all subsists as a special ager publicus"^[1] separate from the numerous private landed proprietors.

In both forms, the individuals relate not as workers but as proprietors — as members of a community who also work. The purpose of this labour is not the creation of value, although they may perform surplus labour in order to exchange it for alien, i.e. surplus, products. Its purpose is the maintenance of the individual proprietor and his family as well as of the community as a whole. The positing of the individual as a worker, who is stripped of all qualities except this one, is itself a historical product.

In the earliest form of this landed property, a naturally evolved community is the first prerequisite: the family, and the family expanded into a tribe,^[134] or [formed] through INTERMARRIAGE between families, or a combination of tribes. Since we may assume that pastoralism, or more generally a nomadic way of life, is the first form of existence; that the tribe does not settle on a certain site but that it grazes off what it finds there and moves on — men are not settled by nature (unless perhaps in such an exceptionally fertile region that they settle on a tree like the monkeys; otherwise, they are ROAMING like the wild animals)—the tribal community, the natural community, is not the result but the precondition of the common (temporary) appropriation and use of the soil.

When men finally do settle down, the degree of change which this original community will undergo, will depend partly on various external, climatic, geographical, physical, etc., conditions and partly on their particular natural disposition, etc.— their tribal character. The naturally evolved tribal community, or, if you wish, the herd — common ties of blood, language, custom, etc.— is the first precondition for the appropriation of the objective conditions of their life, and of the life activity reproducing and objectifying itself (activity as herdsmen, hunters, agriculturalists, etc.).

The earth is the great workshop, the arsenal which provides both the means and the materials of labour, as well as the location, the basis of the community. Men relate naively to it as the property of the community, and of the community which produces and reproduces itself in living labour. Each individual regards himself as a proprietor or owner only qua MEMBER of such a community.

The real appropriation through the process of labour takes place under these preconditions, which are not themselves the product of labour but appear as its natural or divine preconditions. This form, where the fundamental relationship is the same [common property in land], may realise itself in a variety of ways. It does not contradict it at all, for instance, that, as in most Asiatic fundamental forms, the all-embracing unity which stands above all these small communities may appear as the higher or as the sole proprietor, and the real communities, therefore, merely as hereditary occupiers. Since the unity is the real proprietor, and the real precondition of common property, it is quite possible for it to appear as something distinct over and above the many real, particular communities. The individual is then IN FACT propertyless, or property — i.e. the relation of the individual to the natural conditions of labour and reproduction as belonging to him, as the objective body of his subjectivity present in the form of inorganic nature — appears to be mediated for him through a concession from the total unity — a unity realised in the despot as the father of the many communities — to the individual via the particular commune. It therefore follows that the surplus product (which, incidentally, is legally determined in consequence of the real appropriation through labour) belongs to this highest unity.

Hence, in the midst of Oriental despotism and the absence of property which it juridically appears to imply, there in fact exists as its foundation this tribal or communal property, mostly produced through a combination of manufacture and agriculture within the small community, which thereby becomes completely SELF-SUSTAINING and comes to contain within itself all the conditions necessary for reproduction and extended production. Part of its surplus labour belongs to the higher community, which ultimately exists as a person, and this surplus labour is expressed both in tribute, etc., and in common labours performed for the glorifica-tion of the unity, which is in part the real despot and in part the imagined tribal being, the god.

In so far as it is actually realised in labour, this type of communal property can appear in two ways: either the small communities vegetate independently side by side, and within each the individual labours independently with his family on the plot assigned to him. (A certain amount of labour will also be performed for the communal reserve—for INSURANCE, SO to speak — on the one hand; and [on the other] for defraying the costs of the community as such, i.e. for war, religious worship, etc.; lordly dominion, in its most original sense, emerges only at this point, e.g. in the Slavonic and Romanian communities, etc. Herein lies the transition to labour services, etc.) Or the unity can extend to the communality of labour itself, which may be systematically organised, as in Mexico and especially Peru, among the ancient Celts, and among some tribes in India.

Furthermore, the communality within the tribal body may appear either in such a way that its unity is represented in one head of the tribal kinship group, or else as a relationship between the heads of families. The former will produce a more despotic, the latter a more democratic form of this community. The communal conditions for real appropriation through labour, such as irrigation systems (very important among the Asian peoples), means of communication, etc., then appear as the work of the higher unity — of the despotic government poised above the lesser communities. Cities in the proper sense arise alongside these villages only where the location is especially favourable to foreign trade, or where the head of State and his satraps exchange their revenue (the surplus product) for labour, spend it as LABOUR funds.

[IV-52] The second form [of property] has, like the first, given rise to substantial local, historical, etc., variations. It is the product of a more dynamic historical life, of the fate and modification of the original tribes. It also assumes the communal system as the first presupposition, but not, as in the first case, as the substance of which the individuals are mere accidental factors, or of which they are only naturally evolved parts. It does not presuppose land as its basis, but the city as already constructed seat [centre] of the rural population (landowners). The cultivated fields are the territory of the city, whereas [in the first form of property] the village was a mere appendage to the land.

However great the obstacles the land may put in the way of those who till it and really appropriate it, it offers no resistance to the people relating to it as the inorganic nature of the living individual, as his workshop, his means of labour, the object of his labour, and the means of subsistence of the subject. The difficulties encountered by the organised community can arise only from other communities which either have already occupied the territory or disturb the community in its occupation of it. War is therefore the great all-embracing task, the great communal labour, which is required either for the occupation of the objective conditions for being alive, or for the protection and perpetuation of this occupation. The community consisting of families is therefore organised above all on military lines, for purposes of war, and this is one of the conditions of its being there as a proprietor. Concentration of settlement in the city is the foundation of this warlike organisation.

The nature of the tribal system leads to the differentiation of kinship groups into higher and lower, and this differentiation is developed further through intermixture with subjugated tribes, etc.

Communal property — as State property, ager publicus—is here separate from private property. The property of the individual is here not itself direct communal property, as in our first case, where the individual is not a proprietor in separation from the community, but rather merely the occupier [of the plot of communal land allotted to him].

The less it is the case that individual property can be utilised only through communal labour (such as e.g. the irrigation systems of the Orient); the more the purely naturally evolved character of the tribe breaks down through the movement of history or migration; the more the tribe moves away from its original place of settlement and occupies foreign territory, thus entering into essentially new conditions of labour and stimulating the development of the energies of the individual; and the more the communal character of the tribe appears, and must appear, rather as a negative unity as against the outside world — the more are the conditions given under which the individual can become a private proprietor of land — of a particular plot — whose particular cultivation falls to him and his family.

The community as a State is on the one hand the relationship of these free and equal private proprietors to each other, their combination against the outside world — and it is at the same time their safeguard. Communal life is here based as much on the fact that its members are working landed proprietors, smallholding peasants, as the peasants' independence is based on their mutual relation as members of the community, on safeguarding the ager publicus for the communal needs and the communal glory, etc. To be a member of the community remains the precondition for the appropriation of land, but as a member of the community the individual is a private proprietor. He relates to his private property as to land but at the same time as to his being as a member of the community, and his maintenance as such is just as much the maintenance of the community, and vice versa, etc. Since the community, though here already a product of history, not only de facto, but also in its own consciousness, is therefore conceived as having come into being, we have here the precondition for property in land — i.e. for the relation of the working subject to the natural preconditions of labour as belonging to him. But this belonging is mediated through his being as a member of the State, through the existence of the State — i.e. through a presupposition which is regarded as divine, etc.

Concentration in the city, with the land as its territory; small-scale agriculture producing for direct consumption; manufacture as the domestic sideline of wives and daughters (spinning and weaving), or made independent only in a few individual branches {fabric etc.).

The precondition for the survival of this community is the maintenance of equality among its free SELF-SUSTAINING PEASANTS, and their own labour as the condition for the continued existence of their property. They relate as proprietors to the natural conditions of labour; but their personal labour must constantly posit these conditions as real conditions and objective elements of the personality of the individual, of his personal labour.

On the other hand, the tendency of this small warlike community drives it beyond these limits, etc. (Rome, Greece, the Jews, etc.).

As Niebuhr says:

"When the auguries had assured Numa of the divine approval for his election, the first concern of the pious monarch was not the worship of the gods, but a human one. He distributed the land that Romulus had conquered in war and left to be occupied; he founded the worship of Terminus. All the ancient law-givers, and above all Moses, founded the success of their arrangements for virtue, justice and good morals upon landed property, or at least secure hereditary possession of land, for the greatest possible number of citizens" ([B. G. NiebuhrJ Römische Geschichte, Vol. I, 2nd edition, [Berlin,] 1827, p. 245).

T h e individual is PLACED IN SUCH CONDITIONS OF GAINING HIS LIFE AS TO MAKE NOT THE ACQUIRING OF WEALTH HIS OBJECT, BUT SELF-SUSTENANCE, HIS OWN REPRODUCTION AS A MEMBER OF THE COMMUNITY; THE REPRODUCTION OF HIMSELF AS PROPRIETOR OF THE PARCEL OF GROUND AND, IN THAT QUALITY, AS A MEMBER OF THE COMMUNE.

The continuation of the COMMUNE is the reproduction of all its MEMBERS as SELF-SUSTAINING PEASANTS, whose surplus time belongs precisely to the COMMUNE, to the labour of war, etc. Property in one's own labour is mediated through property in the conditions of labour — the hide of land, which is itself guaranteed by the existence of the community, which in turn is safeguarded by the surplus labour of its members in the form of military service, etc. The member of the community reproduces himself not by cooperation in WEALTH-PRODUCING labour, but by cooperation in labour for the (real or imaginary) communal interests aimed at maintaining the union against external and internal stress [nach aussen und innen]. Property is quiritarium,* property of the Romans; the private owner of land is such only by virtue of being a Roman, but as Roman he is a private landowner.

[IV-53] A third form of the property of working individuals, SELF-SUSTAINING MEMBERS OF THE COMMUNITY, in the natural conditions of their labour, is the Germanic. Here it is not the case, as in the specifically Oriental form, that the member of the community is as such co-holder of the communal property.b The Germanic form also differs from the Roman, Greek (in short, the ancient classical) form, where the land is occupied by the community, Roman land; where part of the land remains with the community as such, as distinct from its members, ager publicus in its various forms; and where the remainder is distributed, and each plot is Roman by virtue of the fact that it is the private property, the domain, of a Roman, the part of the workshop which belongs to him, but he is a Roman only by virtue of the fact that he enjoys this sovereign right over part of the Roman soil.

/ " I n antiquity, urban crafts and trade looked down on, but agriculture held in high esteem; in the Middle Ages the contrary appraisal" [B. G. Niebuhr, op. cit., p. 418]./'

/ " ' The right to use communal land through occupation originally belonged to the patricians, who later enfeoffed their clients; the assignment of property out of the ager publicus belonged exclusively to the plebeians ; all assignments in favour of plebeians as compensation for a share in the communal land. Landed property in the strict sense, if we except the area adjacent to the city wall, was originally in the hands only of the plebeians" (rural communities admitted at a later stage) [ibid., pp. 435-36]./

/"Essence of the Roman plebs as a totality of agriculturalists, as indicated in their quiritary property. The ancients were unanimous in regarding agriculture as the proper occupation of the free man, the school for soldiers. In it the ancient stock of the nation is maintained; it changes in the cities, where foreign merchants and artisans settle, as the indigenous inhabitants migrate there, enticed by the hope of gain. Wherever there is slavery, the freedman seeks his subsistence in such activities, through which he often accumulates wealth; and indeed in antiquity such occupations were mostly in their hands, and were therefore regarded as unsuitable for citizens; hence the view that the admission of craftsmen to full citizenship was risky (the early Greeks, as a rule, excluded them from it), ovbevl Èiz,r\v TcoiJLaîwv OV'TE xàiTT)Xov OISTE XEipoTexviqv ßtov è'xeiv.a The ancients had no conception of the guild pride and dignity of medieval urban history; and even here the military spirit declined as the guilds overcame the noble families, and was finally extinguished; and consequently, with it, the respect and freedom the cities enjoyed in the outside world" [ibid., pp. 614-15]./

/ " The tribes of the ancient states were constituted in one of two ways, either by kinship or by locality. Kinship tribes historically precede locality tribes, and were almost everywhere supplanted by them. Their extreme and most rigid form is the

particular part of it, hereditary or not, since any fraction of property does not belong to a member of the community for himself, but only as the direct part of the community, i.e. as someone in direct unity with the community and not as distinct from it. The individual is therefore merely an occupier. There is only communal property and private occupation. How this occupation relates to communal property may vary widely historically, locally, etc., depending on whether labour is performed in isolation by the private occupier or is itself determined by the community, or by the unity standing above the particular community." — Ed.

caste system where one caste is separated from another, without the right of intermarriage, with quite different status; each with its exclusive, unchangeable occupation.

"The locality tribes originally corresponded to a division of the area into districts and villages; so that someone residing in a village at the time of this division, in Attica under Cleisthenes, was registered as a demotes of that village, and as a member of the phyle of the area to which that village belonged. However, as a rule his descendants, regardless of place of domicile, remained in the same phyle and the same deme, whereby this division assumed an appearance of ancestral descent."

The Roman kin groups did not consist of blood-relatives; to the common name, Cicero adds descent from free men as a criterion. The members of the Roman gens had common shrines, but this had already disappeared by the time of Cicero. The joint inheritance from fellow-kinsmen who died without dependants and intestate survived longest of all. In the earliest period, members of the gens obliged to assist fellow-kinsmen in need of help to bear unusual burdens. (This originally universal among the Germans, and persisted longest among the Dithmarschen.^[136]) The gentes were guilds. "A more general organisation than that of kin groups did not exist in the ancient world. Thus among the Gaels^[137] the aristocratic Campbells and their vassals constituted a single clan" [ibid., pp. 317-35].^"

Since the patrician represents the community to a higher degree, he is the POSSESSOR of the ager publicus, and uses it through his clients, etc. (also, gradually appropriates it).

The Germanic commune is not concentrated in the city; by means of such a concentration — the city as centre of rural life, residence of the agricultural labourers, as also the centre of warfare — the commune as such gains an outward existence, distinct from that of the individual. Ancient classical history is the history of cities, but cities based on landed property and agriculture; Asiatic history is a kind of indifferent unity of town and country (the really large cities must be regarded here merely as royal camps, as an artificial excrescence on the actual economic structure); the Middle Ages (Germanic period) begins with the land as the locus of history, whose further development then proceeds through the contradiction between town and country; modern [history] is the urbanisation of the countryside, not, as in ancient times, the ruralisation of the city.

[V-l]⁽¹⁾ With its coming together in the city, the commune as such acquires an economic existence; the very presence of the city as such distinguishes it from a mere multiplicity of separate houses. The whole here is not merely a collection of its separate parts. It is a kind of independent organism. Among the Germanic peoples where the individual family chiefs settled in forests, separated by long distances, the commune exists even outwardly merely by virtue of the periodic gatherings of its members, although their unity in-itself is posited in descent, language, common past and history, etc.

The commune therefore appears as an assembly, not an association, as a unification whose independent subjects are the landed proprietors, and not as a unity. IN FACT, the community therefore does not exist as a State, as a State system, as among the ancients, because it does not exist as a city. For the community to come into real existence, the free landed proprietors must hold an assembly, whereas, e.g. in Rome, it exists apart from such assemblies, in the presence of the city itself and in the persons of the officials put in charge of it, etc.

True, the ager publicus, the communal land or people's land, occurs among the Germanic peoples also, as distinct from the property of the individual. It consists of hunting grounds, pastures, woodlands, etc., that part of the land which cannot be partitioned, if it is to serve as a means of production in this specific form. However, the ager publicus does not, as among e.g. the Romans, embody the specific economic being of the State, as against the private owners — so that they were private owners properly speaking in so far as they were excluded from, i.e. deprived of the use of, the ager publicus, like the plebeians.

The ager publicus is rather a mere supplement to individual property among the Germanic peoples, and figures as property only in so far as it is defended against hostile tribes as the common property of one particular tribe. The property of the individual is not mediated through the community, but the existence of the community and of communal property is mediated, i.e. it appears as a relation of the independent subjects to one another. Au fond, each individual household contains an entire economy, forming as it does an independent centre of production (manufacture merely the domestic sideline of the women, etc.).

In the ancient world, it is the city with its attached territory that forms the economic totality, in the Germanic world, it is the individual home, which itself appears merely as a small dot in the land belonging to it; which is not a concentration of many proprietors, but the family as an independent unit. In the Asiatic form (at least in its predominant variant), there is no property, but only occupation by individuals; the commune is properly speaking the real proprietor — hence property only as communal property in land.

Among the ancients (Romans as the classical example, the thing in its purest, most fully developed form), there is a contradiction between the form of State landed property and private landed property, so that the latter is mediated through the former, or the former itself exists in this dual form. The private landed proprietor is thus simultaneously an urban citizen. Economically, citizenship may be expressed in the simple statement that the tiller of the soil is a city dweller.

In the Germanic form, the tiller of the soil is not a citizen, i.e. not a city dweller; the foundation of this form is the isolated, independent family settlement, guaranteed by its bond with the other family settlements of the same tribe, and their occasional assembly for purposes of war, religion, adjudication, etc., which establishes their mutual surety. Individual landed property does not here appear as a contradictory form as against communal landed property, nor as mediated by the community, but the other way round. The community exists only in the mutual relation of the individual landed proprietors as such. Communal property as such appears only as a communal appendage to the individual kin settlements and land appropriations.

The [Germanic] community is neither the substance, of which the individual appears merely as the accident [as in the Oriental community], nor is it the general, which exists as such and has a unified being [as with the ancients] either in the mind or in the reality of the city and its urban requirements as distinct from those of the individual, or in the urban territory as its separate being as distinct from the particular economic being of the member of the community. The community is, rather, on the one hand, presupposed in itself to the individual proprietor as the common element in language, blood, etc.; but on the other hand it has being only in its real assembly for communal purposes. In so far as it has a separate economic existence in the communally used hunting grounds, pastures, etc., it is used in these ways by every individual proprietor as such, and not in his capacity as a representative of the State (as in Rome). It is therefore genuinely the common property of the individual proprietors, and not of the union of these proprietors as an entity endowed with an existence of its own in the city, distinct from themselves as individuals.

The crucial point here is this: in all these forms, in which landed property and agriculture constitute the basis of the economic order, and hence the economic object is the production of use values, i.e. the reproduction of the individual in his particular relationships to his community, in which he forms its basis, we find the following elements:

(1) Appropriation of the natural condition of labour, of the earth as the original instrument of labour, both as workshop and repository of raw materials; however, appropriation not by means of labour but as the prerequisite for labour. The individual relates simply to the objective conditions of labour as his own, as the inorganic nature of his subjectivity, which realises itself through them. The chief objective condition of labour does not itself appear as the product of labour, but is already there as nature. [V-2] On the one hand the living individual, on the other the earth, as the objective condition of his reproduction.

(2) However, this relation to the land, to the soil, as the property of the working individual, who therefore right from the outset does not appear merely as a working individual in this abstraction, but who has an objective mode of existence in his ownership of the land, an existence which is presupposed to his activity and is not a mere result of it, and which is as much a precondition of his activity as his skin, his sense organs, which, though he also reproduces and develops these in his life process, are nevertheless presupposed to this reproduction process — this relation is instant-ly mediated by the naturally evolved and more or less historically developed and modified being of the individual as a member of a community—his naturally evolved being as part of a tribe, etc.

An isolated individual could no more have property in land than he could speak. True, he could live off the land, as animals do. But the relation to the soil as property always arises from the peaceful or violent occupation of the land by the tribe, the community in a form more or less naturally evolved or already historically developed. The individual here can never appear so thoroughly isolated as he does as mere free worker. If the objective conditions of his labour are presupposed as belonging to him, he himself is subjectively presupposed as belonging to a community, through which his relationship to the land is mediated. His relation to the objective conditions of labour is mediated by his being as a member of a community. Conversely, the real being of the community is determined by the particular form of his ownership of the objective conditions of labour. Whether this property mediated by his being within a community is communal property, where the individual is merely occupier and where there is no private property in land,—or whether property has the dual form of State and private property, but in such a way that the latter appears as posited by the former, so that only the citizen is and has to be a private proprietor, while on the other hand his property as a citizen also has a separate existence,—or whether, finally, communal property appears as merely sup-plementary to individual property, the latter, however, as the basis, and the community does not exist for itself at all outside the assembly of its members and their association for common purposes — these different forms of relation of the members of the commune or tribe to the tribal land — to the territory on which it has settled — depend partly upon the natural character of the tribe, partly on the economic conditions under which it now actually relates itself to the soil as proprietor, i.e. appropriates its fruits by means of labour, and this, in turn, depends on the climate, the physical properties of the soil, the physically conditioned mode of its utilisation, the relationship to hostile or neighbouring tribes, and the modifications brought about by migrations, historical events, etc.

For the commune to continue to exist as such in the old way, the reproduction of its members under the objective conditions presupposed is necessary. In time, production itself, the increase in population (which also belongs to production) necessarily transcends these conditions, destroys them instead of reproducing them, etc., and as a result of this the communal system decays and dies along with the property relations on which it was based.

The Asiatic form necessarily survives longest and most stubborn-ly. This is inherent in its presupposition, namely that the individual does not become independent vis-à-vis the commune; that there is a SELF-SUSTAINING circle of production, a unity of agriculture and handicrafts, etc.

If the individual changes his relationship to the community, he thereby changes and undermines the community and its economic premiss. On the other hand, the modification of this economic premiss, which is brought about by its own dialectic, impoverish-ment, etc., particularly the impact of war and conquest, which, e.g. in Rome, belongs essentially to the economic conditions of the community itself, transcends the real bond on which the community rests.

In all these forms, the basis of development is the reproduction of presupposed relationships between the individual and his commune —relationships more or less naturally evolved or else historically developed, but become traditional — and a specific objective existence, predetermined for the individual, both as regards his relation to the conditions of labour and his relation to his co-workers, fellow-tribesmen, etc. The development therefore is from the outset a limited one, but once the limit is transcended, decay and ruin ensue. The development of slavery, the concentration of landed property, exchange, a monetary economy, conquest, etc., had this effect among the Romans, though all these elements seemed up to a certain point compatible with the basis, in part a mere harmless extension of it, in part mere abuses flowing out of it. Considerable developments are possible here within a particular sphere. Individuals may appear great. But free and full development, either of the individual or of society, is inconceivable here, since such a development stands in contradiction to the original relation.

[V-3] Among the ancients, we never come across an investigation into which form of landed property, etc., is the most productive, creates the greatest wealth. Wealth does not appear as the purpose of production, although Cato may well investigate which way of field cultivation is the most profitable, or even Brutus may lend his money at the highest rate of interest. The enquiry is always about which form of property creates the best citizens. Wealth as an end-in-itself appears only among a few trading peoples— monopolists of the CARRYING TRADE — who live in the pores of the ancient world like the Jews in medieval society. Now, wealth is on the one hand a thing, embodied in things, in material products, which man confronts as subject. On the other hand, wealth as value is simply command over alien labour, not for the purpose of domination but of private consumption, etc. In all its forms it appears in physical shape, whether as a thing or as a relationship mediated by a thing, located outside the individual, somewhere near him.

In this way, the old view according to which man always appears in however narrowly national, religious or political a determination as the end of production, seems very exalted when set against the modern world, in which production is the end of man, and wealth the end of production. IN FACT, however, if the narrow bourgeois form is peeled off, what is wealth if not the universality of the individual's needs, capacities, enjoyments, productive forces, etc., produced in universal exchange; what is it if not the full development of human control over the forces of nature — over the forces of so-called Nature, as well as those of his own nature? What is wealth if not the absolute unfolding of man's creative abilities, without any precondition other than the preceding historical development, which makes the totality of this development — i.e. the development of all human powers as such, not measured by any previously given yardstick — an end-in-itself, through which he does not reproduce himself in any specific character, but produces his totality, and does not seek to remain something he has already become, but is in the absolute movement of becoming?

In the bourgeois economy — and in the epoch of production to which it corresponds — this complete unfolding of man's inner potentiality turns into his total emptying-out. His universal objectification becomes his total alienation, and the demolition of all determined one-sided aims becomes the sacrifice of the [human] end-in-itself to a wholly external purpose. That is why, on the one hand, the childish world of antiquity appears as something superior. On the other hand, it is superior, wherever fixed shape, form and established limits are being looked for. It is satisfaction from a narrow standpoint; while the modern world leaves us unsatisfied or, where it does appear to be satisfied with itself, is merely vulgar.

What Mr. Proudhon calls the extra-economic origin of property— by which he means precisely landed property⁽²⁾—is the pre-bourgeois relation of the individual to the objective conditions of labour, and initially to the natural, objective, conditions of labour. For, just as the working subject is a natural individual, a natural being, so the first objective condition of his labour appears as nature, earth, as his inorganic, body. He himself is not only the organic body, but also this inorganic nature as a subject. This condition is not something he has produced, but something he finds to hand; as the natural world outside himself and presupposed to him.

Before proceeding in our analysis, one further point: the worthy Proudhon would not only be able to, he would have to, accuse capital and wage labour—as forms of property — of having an extra-economic origin. For the worker's encounter of the objective conditions of his labour as something separate from him, as capital, and the capitalist's encounter of the propertyless worker, as an abstract worker — the exchange as it takes place between value and living labour — presupposes an historical process, however much capital and wage labour themselves reproduce this relation and elaborate it in its objective scope, as well as in depth. And this historical process, as we have seen, is the history of the emergence of both capital and wage labour.

In other words, the extra-economic origin of property means nothing but the historical origin of the bourgeois economy, of the forms of production to which the categories of political economy give theoretical or conceptual expression. The statement that pre-bourgeois history, and each phase of it, has its own economy and an economic basis of its movement, is au fond merely the tautology that human life has from the beginning rested on production, and, d'une manière ou d'une autre,⁽³⁾" on social production, whose relations are precisely what we call economic relations.

The original conditions of production cannot initially be themselves produced, cannot be the results of production. (Instead of original conditions of production we might also say: the conditions for the reproduction of an increasing number of human beings by means of the natural process of the two sexes. For if this reproduction appears on one side as the appropriation of the objects by the subjects, it equally appears on the other as the shaping and the subjection of the objects by and to a subjective purpose; the transformation of the objects into results and repositories of subjective activity.) What requires explanation is not the unity of living and active human beings with the natural, inorganic conditions of their exchange of matter with nature, and therefore their appropriation of nature; nor of course is this the result of an [V-4] historical process. What we must explain is the separation between these inorganic conditions of human existence and this active being, a separation which is posited in its complete form only in the relationship between wage labour and capital.

In the relation of slavery and serfdom there is no such separation; rather, one part of society is treated by another as the mere inorganic and natural condition of its own reproduction. The slave stands in no relation whatsoever to the objective conditions of his labour; rather, labour itself, both in the form of the slave and of the serf, is placed along with the other natural beings such as cattle as an inorganic condition of production, as an appendage of the soil.

In other words: the original conditions of production appear as natural presuppositions, natural conditions of the existence of the producer, just as his living body, even though he reproduces and develops it, is not originally posited by himself, but appears as his own presupposition; his own (corporeal) being is a natural presupposition not posited by himself. These natural conditions of existence, to which he relates as to his own inorganic body, have a dual character: they are (1) subjective and (2) objective. The producer becomes aware of himself as member of a family, a tribe, a clan, etc.—which then, in the process of intermixture and conflict with others, assume historically different shapes; and, as such a member, he relates to a specific nature (we can still call it earth, land, soil) as his own inorganic being, as the condition of his production and reproduction. As the natural member of the community, he participates in the communal property and takes a particular share of it into his own possession; just so, as a native Roman citizen, he has (AT LEAST) a notional claim to the ager publicus and a real claim to a specified number of jugera of land, etc.

His property, i.e. his relation to the natural presuppositions of his production as belonging to himself, as his own, is mediated by his natural membership of a community. (The abstraction of a community whose members have nothing in common but e.g. language, etc., and barely even that, is plainly the product of much later historical circumstances.) With regard to the individual, for instance, it is evident that he himself relates to his language as his own only as the natural member of a human community. Language as the product of an individual is an absurdity. But this is equally true of property.

Language itself is just as much the product of a community as in another respect it is the being of the community, its articulate being, as it were.

/Communal production and communal property, as found e.g. in Peru, is evidently a secondary form, introduced and transmitted by conquering tribes, who had been familiar at home with communal property and communal production in the older and simpler form, as it occurs in India and among the Slavs. Similarly, the form found e.g. among the Celts in Wales appears to have been transmitted to them, a secondary form, introduced by conquerors among the less developed conquered tribes. The perfection and systematic elaboration of these systems by supreme central authority indicate their later origins. Just as the feudalism introduced into England was formally more complete than the feudalism which had evolved naturally in France./

/ Among nomadic pastoral tribes — and all pastoral peoples are originally nomadic — the land, like all other conditions of nature, appears in its elemental boundlessness, e.g. in the Asian steppes and the Asian high plateau. But it is grazed, etc., consumed by the herds, off which the nomadic peoples live. They relate to it as their property, though they never stabilise that property. This is the case with the hunting grounds of the wild Indian tribes of America; the tribe considers a certain region as its hunting territory, and maintains it by force against other tribes, or seeks to expel other tribes from the territory they claim. Among the nomadic pastoral tribes, the community is in fact always united, a travelling party, caravan, horde, and the forms of hierarchy evolve from the conditions of this mode of life. In fact, only the herd and not the soil is here appropriated and reproduced, but the soil is always temporarily used in common at each and every halting place.^

Let us now turn to the consideration of settled peoples. The only barrier which the community can encounter in relating itself to the natural conditions of production — to the land — as its own, is some other community which has already laid claim to them as its inorganic body. Warfare is therefore one of the earliest types of labour for every naturally evolved community of this kind, both for the defence of property and for its acquisition.

(It will actually be sufficient here to speak of original property in land, for among pastoral peoples property in natural products of the earth, e.g. sheep, is at the same time property in the pastures they pass through. In general, property in land includes property in its organic products.)

^ I f [V-5] man himself is captured together with the land as an organic appendage of it, he is captured as one of the conditions of production, and this is the origin of slavery and serfdom, which soon debase and modify the original forms of all communities, and then themselves become their basis. The simple structure is thereby negatively determined.^

Thus originally property means nothing more than man's relating to his natural conditions of production as belonging to him, as his own, as presupposed along with his own being; his relating to them as natural presuppositions of himself, which constitute, as it were, only an extension of his body. Actually, he does not relate to his conditions of production, but has a dual being, both subjectively as himself, and objectively in these natural inorganic conditions of his existence.

The forms of these natural conditions of production are dual: (1) his being as member of a community, hence the being of this community which in its original form is a tribal community, more or less modified; (2) his relation to the land by means of the community, as to his own; communal landed property, at the same time individual occupation for the individual, or in such a manner that the soil itself and its cultivation remain communal, and only its fruits are divided. (Yet, dwellings, etc., even if only the waggons of the Scythians, appear nevertheless to be always in the possession of individuals.) Membership of a naturally evolved society, a tribe, etc., is a natural condition of production for the living individual. Such membership is e.g. already a condition of his language, etc. His own productive being can only have existence under this condition. His subjective being as such is conditioned by it as much as it is conditioned by his relating to the land as to his workshop.

(True, property is originally mobile, for d'abord man takes possession of the ready-made fruits of the earth, to which, among others, belong the animals and especially those he can domesticate. However, even this situation — hunting, fishing, pastoralism, subsistence by collecting the fruits of the trees, etc.—always presupposes the appropriation of the land, whether as a place of fixed residence or a territory for ROAMING, a pasture for his animals, etc.)

Property therefore means belonging to a tribe (community) (having one's subjective/objective existence within it), and, mediated by the relation of this community to the land, to the earth as its inorganic body, [it also means] the relation of the individual to the land, to the external primary condition of production — since the earth is at the same time raw material, tool and fruit — as the preconditions belonging to his individuality, as its modes of being. We reduce this property to the relation to the conditions of production. Why not to those of consumption, since originally the act of producing by the individual is confined to the reproduction of his own body through the appropriation of ready-made objects prepared by nature for consumption? But even where the task is only to find and discover, effort, labour — as in hunting, fishing, the care of herds — and the production (i.e. the development) of certain skills are soon required on the part of the subject. This means that conditions in which man need merely reach for what is already available, without any tools (i.e. products of labour already designed for production), without alteration of form (which takes place even in herding), etc., are very transitory, and can nowhere be regarded as normal; not even as normal at the earliest stage. Of course, it has to be remembered that the original conditions of production include substances directly consumable without labour, such as some fruit, animals, etc.; thus the consumption fund is itself part of the original production fund.

The fundamental condition of property based on tribalism (which is what communalism originally amounts to) is to be a member of the tribe. This makes a tribe conquered and subjugated by another propertyless and places it among the inorganic conditions of the conquering tribe's reproduction, to which that community relates as to its own. Slavery and serfdom are therefore only further developments of property based on tribalism. They necessarily modify all its forms. They are least able to do this in the Asiatic form. In the SELF-SUSTAINING unity of manufacture and agriculture on which this form is based, conquest is not so essential a condition as where landed property, agriculture, predominate exclusively. On the other hand, since the individual in this form never becomes a proprietor but only an occupier, he is au fond himself the property, the slave of that [in] which the unity of the community exists. Here slavery neither puts an end to the conditions of labour, nor does it modify the essential relation.

[V-6] It is now further evident that: In so far as property is only a conscious relation to the conditions of production as to one's own—and, with respect to the individual, a relation posited by the community and proclaimed and guaranteed as law, the being of the producer thus appearing as a being within the objective conditions belonging to him—it is realised only through production. Real appropriation does not occur through the establishment of a notional relationship to these conditions, but takes place in the active, real relationship to them, when they are really posited as the conditions of man's subjective activity.

In the light of this it is also clear that these conditions change. Only when a tribe hunts, does a particular region of the earth become a hunting ground; only when the soil is tilled, is the land posited as the extension of the body of the individual. Once the city of Rome was built, and its surrounding land cultivated by its citizens, the conditions of the community were different from what they had been before. The object of all these communities is preservation, i.e. the reproduction of their individual members as proprietors, i.e. in the same objective mode of existence, which also constitutes the relationship of the members to each other, and therefore constitutes the community itself But this reproduction is at the same time necessarily new production and the destruction of the old form. For instance, where each individual is supposed to possess a certain amount of land, the increase in population already presents a problem. If it is to be coped with, colonisation and with it wars of conquest have to be undertaken. Hence slaves, etc., also e.g. the enlargement of the ager publicus, and hence more patricians, who represent the community, etc.

Thus the preservation of the old community implies the destruction of the conditions on which it rests, and turns into its opposite. For instance, if it were to be argued that productivity could be increased within the same territory, through a development of the productive forces, etc. (which in traditional agriculture is precisely what develops more slowly than anything else), this would imply new methods and combinations of labour, a high proportion of the day being devoted to agriculture, etc., and, once again, the old economic conditions of the community would be transcended. In the act of reproduction itself are changed not only the objective conditions — e.g. village becomes city, the wilderness becomes cultivated clearings, etc.—but also the producers, who transform themselves in that they evolve new qualities from within themselves, develop through production new powers and new ideas, new modes of intercourse, new needs, and new speech.

The more traditional the mode of production itself — and it persists for a long time in agriculture and even longer in the Oriental mutual complementation of agriculture and manufacture — i.e. the more the real process of appropriation remains the same, the more unchanging will be the old forms of property and therefore also the community as a whole.

Where the members of the community have already developed a separate entity as private proprietors from their collective entity as an urban community and owners of the urban territory, conditions already arise in which the individual may lose his property, i.e. the dual relationship which makes him both a citizen with equal status, belonging to the community, and a proprietor. In the Oriental form, this loss is hardly possible, except as a result of wholly external influences, since the individual member of the commune never enters into so independent a relation to it that he could lose his (objective, economic) tie with it. He is firmly rooted. This is also inherent in the union of manufacture and agriculture, of town (in this instance the village) and country.

Among the ancients [Greeks and Romans], manufacture already appears as degeneration (an occupation fit only for freedmen, clients and foreigners), etc. This development of productive labour (its emancipation from total subordination to agriculture, as domestic labour, labour of freedmen, manufacture devoted only to agricultural purposes and war, or to religious observances and communal requirements such as the construction of houses, roads or temples), this development, which necessarily arises from intercourse with foreigners, from slaves, from the desire to exchange the surplus product, etc., destroys the mode of production on which the community rests, and with it the objective individual—i.e. the individual Greek, Roman, etc. Exchange has the same effect, and so has indebtedness, etc.

The original unity between a specific form of communal or tribal entity and the property in nature corresponding to it, or relation to the objective conditions of production as natural, as the objective being of the individual mediated by the community — this unity, which in one sense appears as the particular form of property, has its living reality in a specific mode of production itself, and this mode is as much the relationship of the individuals to one another as it is their specific active relationship [V-7] towards inorganic nature, a specific mode of working (which is always family labour and often communal labour). The community itself appears as the first great force of production; particular conditions of production ([favouring] e.g. stock-breeding or agriculture) give rise to particular modes of production and particular forces of production, both subjective ones, i.e. those which appear as qualities of the individuals, and objective ones.

In the final analysis the community, as well as the property based upon it, comes down to a certain stage in the development of the productive forces of the working subjects, to which correspond certain relations of these subjects to each other and to nature. Up to a certain point, reproduction. Then this turns into dissolution.

Property—and this applies to its Asiatic, Slavonic, ancient [classical] and Germanic forms — therefore originally means the relation of the working (producing) subject (or the subject reproducing himself) to the conditions of his production or reproduction as his own. Hence it will take different forms depending on the conditions of production. The object of production itself is to reproduce the producer in and together with these objective conditions of his being. This relation as a proprietor — not as the result but as the presupposition of labour, i.e. of production — presupposes in turn a particular existence of the individual as member of a tribal or communal entity (whose property he himself is up to a certain point).

Slavery, serfdom, etc., where the labourer himself appears among the natural conditions of production for a third individual or community (this does not apply e.g. to the general slavery of the Orient, [or does] only from the European POINT OF VIEW)—and where property therefore is no longer the relation of the independently working individual to the objective conditions of labour — is always secondary, never original, although it is the necessary and logical result of property based on the community and on labour in the community.

It is of course very simple to imagine a powerful, physically superior individual, who starts by catching animals and proceeds to capture men in order to make them catch animals for him; in other words, uses man as a naturally occurring condition for his reproduction as he uses any other natural living being. His own labour then is reduced to domination, etc. But such a view is absurd, even though it may be correct from the standpoint of some particular tribal or communal entity, because it starts from the development of isolated individuals.

Man becomes individualised only through the process of history. Originally he is a species being, a tribal being, a herd animal—though by no means as a Çcoov TTOXLTLXOV ' ' in the political sense. Exchange itself is a major agent of this individuation. It makes herd-like existence superfluous and dissolves it. This occurs when matters have changed in such a way that man as an isolated individual relates only to himself, but that the means of positing himself as an isolated individual have become precisely what gives him his general and communal character. It is in the community that the objective being of the individual as a proprietor (e.g. a landed proprietor) is presupposed, and is so, moreover, under certain conditions which chain him to the community, or rather constitute a link in his chain. In bourgeois society, e.g., the worker stands there purely subjectively, without object; but the thing which confronts him has now become the true community, which he tries to make a meal of and which makes a meal of him.

All forms (more or less naturally evolved, but all at the same time results of historical processes) in which the community presupposes its subjects in a specific objective unity with the conditions of their production, or in which a specific subjective mode of being presupposes the communities themselves as condition of production, necessarily correspond only to a development of the productive forces which is limited, and indeed limited in principle. The development of the productive forces dissolves them, and their dissolution is itself a development of the human productive forces. Labour is only undertaken on a certain basis — first naturally evolved — then an historical presupposition. Later, however, this basis or presupposition is itself transcended, or posited as a transient one, which has become too narrow for the unfolding of the progressive human pack.

In so far as the landed property of [classical] antiquity reappears in modern smallholding property, it belongs to political economy and we shall deal with it in the section on landed property.

[V-8] (We have to return to all this for a deeper and more detailed analysis.)

What concerns us for the moment here is this: the relation of labour to capital or to the objective conditions of labour as capital, presupposes an historical process that dissolves the different forms in which the labourer is a proprietor or the proprietor works.

This means first and foremost: (1) Dissolution of the relation to the earth — to land or soil — as a natural condition of production to which man relates as his own inorganic being, the workshop of his forces and the domain of his will. All forms in which this property is found presuppose a communal entity whose members, whatever the formal distinctions between them, are proprietors by virtue of being its members. The original form of this property is therefore direct communal property (the Oriental form modified among the Slavs; developed to the point of contradiction in the property of [classical] antiquity and in Germanic property, though still constituting its hidden, if antagonistic, foundation).

(2) Dissolution of the relations in which he appears as the proprietor of the instrument. Just as the above form of landed property presupposes a real community, so this ownership of the instrument by the labourer presupposes a particular form of development of manufacture — namely handicraft labour. Guild and corporative institutions, etc., bound up with this. (The manufacture system of the ancient Orient can already be considered under heading (1) above.) Here labour itself is still half the expression of artistic creation, half an end-in-itself, etc. Craft mastery. The capitalist himself still a master craftsman. Special craft skill ensures the ownership of the instrument, etc., etc. Then, in a sense, the mode of labour becomes hereditary together with the organisation of labour and its instrument. Medieval city organisation. Labour still belongs to the labourer; a certain self-sufficient development of limited specialised capacities, etc.

(3) Included in both is the fact that man possesses the means of consumption prior to production; this necessary to enable him to keep alive as producer — i.e. during production, before its completion. As landed proprietor, he is directly provided with the necessary consumption fund. As a master craftsman he has inherited it, earned it or saved it up, and as a youth he is first an apprentice, i.e. not yet an independent worker properly speaking, but living in the master's household in the patriarchal manner.

The (real) journeyman enjoys a certain communality with regard to the consumption fund owned by the master. Even if this is not the journeyman's own property, it is, under the laws and customs, etc., of the guild, at least his co-possession. (To be gone into further.)

(4) On the other hand, dissolution, also, of the relations under which the workers themselves, the living labour capacities, are still a direct part of the objective conditions of production and are appropriated as such — are therefore slaves or serfs. For capital, the worker does not represent a condition of production, but only labour. If capital can get it performed by machinery, or even by water or air, tant mieux!" And what capital appropriates is not the worker, but his labour — and not directly, but by means of exchange.

These, then, on the one hand, are historical preconditions for the worker to be found as a free worker, as purely subjective labour capacity, devoid of objectivity, confronting the objective conditions of production as his non-property, as alien property, as ^a/we-for-itself, as capital. On the other hand, the question arises, what are the conditions in which he can find himself confronting capital}

^ The formula of capital in which living labour relates to raw material, as well as to the instrument and the means of subsistence required during work, negatively, as non-property, d'abord includes non-property in land. In other words, the condition is negated in which the working individual relates to land, to the soil, as his own, i.e. in which he works, produces as the proprietor of the land. In the best case, the working individual relates to the land not only as worker, but as proprietor of the land to himself as working subject. Potentially, land ownership includes property both in raw material and in the primordial instrument of labour, the soil itself, as well as in its spontaneous fruits. Within the earliest form, this means that the individual relates to the soil as its owner, finds in it raw material, instrument and means of subsistence created not through labour but springing from the soil itself. Then, reproducing this relation, secondary instruments and fruits of the earth produced by labour are taken as included in land ownership in its primitive forms. This historical situation is thus d'abord negated as the fuller relating-as-property in the worker's relation to the conditions of labour as capital. This is historical situation No. I, which is negated or presupposed as historically dissolved in this relation.

Secondly, [V-9] however, the situation where the worker has a property in the instrument, where the worker relates to the instrument as his own, where he works as owner of the instrument (which necessarily presupposes that the instrument is subsumed in his individual labour, i.e. presupposes a particular limited stage in the development of the productive power of labour), where this form of the worker as proprietor or the working proprietor is already posited as an independent form, separate from and alongside land ownership—the urban development of labour in its artisan forms; not as in the first case, as accidental to land ownership and subsumed under it. Raw material and means of subsistence are only mediated here as the property of the artisan, mediated by his craft, by his property in the instrument. This situation already presupposes a second historical stage, separate from and alongside the first, which must itself have been considerably modified by the fact that this second type of property or of working proprietor has established an independent existence.

Since the instrument itself is already the product of labour, i.e. the element which constitutes property is already posited by labour, the community can here no longer appear, as it can in the first case, in its naturally evolved form, as the community on which this form of property is based, but rather as a community which is itself already produced, which has come into being, as secondary, as a community produced by the worker himself. It is clear that where property in the instrument is the relation to the production conditions of labour as property, the instrument appears in real labour only as a means of individual labour; the art of really appropriating the instrument, of employing it as a means of labour, here appears as a special skill of the worker, which posits him as the proprietor of the instrument. In short, the essential character of the guild and corporative system, where craftwork constitutes its subject as proprietor, can be reduced to the distinction between the relation to the instrument of production — the instrument of labour — as property, and the relation to the soil, to the land (to the raw material as such), as one's own. Thus historical situation No. II, which is characterised by the fact that the relation to this single element of the conditions of production constitutes the working subject as a proprietor, a working proprietor, and which by its nature can exist only as contradiction, or, if you like, as complement, to the modified first situation, is also negated in the first formula of capital.

There is a third possible form, which is to relate as proprietor neither to the land nor to the instrument, hence not even to labour itself, but only to the means of subsistence, which are found as the natural condition of the working subject. This is au fond the formula of slavery and serfdom, which is also negated, i.e. posited as an historically superseded condition, in the relation of the worker to the conditions of production as capital.

The primitive forms of property necessarily dissolve into one's relation to the different objective elements conditioning production as to one's own; they both constitute the economic basis of different forms of community and presuppose specific forms of community. These forms are significantly modified once labour itself becomes one of the objective conditions of production (as in slavery and serfdom), as a result of which the simple affirmative character of all forms of property referred to in No. I is lost and modified. They all potentially include slavery, and therefore their own transcendence. So far as No. II is concerned, where labour has become particularised — where craft mastery and consequently property in the instrument of labour=property in the conditions of production — this admittedly excludes slavery and serfdom, but it may undergo an analogous negative development in the form of the caste system.^

^"The third form of property, in the means of subsistence, unless it is dissolved into slavery and serfdom, cannot contain any relation of the working individual to the conditions of production, and therefore of existence. It can therefore only be the relation of the member of the primitive community founded upon landed property who has lost his landed property and has not yet advanced to property No. II, as in the case of the Roman plebs at the time of the panes et circenses.^^[8]^

^ The relation of RETAINERS to their lords, or that of personal service, is essentially different. For personal service constitutes au fond merely the mode of existence of the landowner who no longer works himself but whose property includes the workers themselves as serfs, etc., among the conditions of production. Here the relationship of dominion exists as an essential relation of appropriation. Au fond there can be no relationship of dominion to animals, to the soil, etc., by virtue of appropriation, even though the animal serves. The appropriation of another's will is presupposed in the relationship of dominion. Creatures without will, like animals for instance, may indeed render services, but this doesn't make the owner their lord. However, what we see here is how the relationships of dominion and servitude also belong to this formula of the appropriation of the instruments of production; and they constitute a necessary ferment in the development and decay of all primitive relations of property and production, just as they express their limitations. To be sure, they are reproduced in capital, in a mediated form, and hence they also constitute a ferment in its dissolution, and are the emblems of its limitations.^

[V-10] / " The right to sell oneself and one's dependants in times of distress, was a grievous general right; it prevailed in the North, as well as among the Greeks and in Asia. The right of the creditor to take the defaulting debtor into servitude, and to redeem the debt as far as possible either by his labour or by the sale of his person, was almost equally widespread" (Niebuhr, [Römische Geschichte, Vol.] I, p. 600)../

^/Elsewhere Niebuhr attributes the difficulties and misunder-standings of Greek writers of the Augustan period concerning the relationship between patricians and plebeians and their confusion of this relationship with that between patrons and clients, to the fact that they

"were writing at a time when rich and poor constituted the only real classes of citizens; when the man in need, no matter how noble his origins, required a patron, and the millionaire, even though only a freedman, was sought after as a patron. They could find scarcely a trace of inherited relations of attachment" (I, 6 2 0 ) . /

/"Artisans were to be found in both classes" (metoikos⁽⁴⁾ and freedmen together luith their descendants), "and plebeians who abandoned agriculture passed into the limited citizen status enjoyed by these. Nor did they lack the honour of legally recognised guilds, and these were so highly respected that Numa was supposed to have been their founder. There were nine such guilds: pipers, goldsmiths, carpenters, dyers, harness-makers, tanners, coppersmiths and potters, the ninth guild embracing the rest of the crafts... Those among them who were independent citizens living outside the city limits, or who enjoyed isopolity⁽⁵⁾ and were independent of any patron (supposing such status was recognised), or those who were descendants of dependent men whose bond had lapsed with the extinction of their patrons' families: these undoubtedly remained as remote from the quarrels of ancient citizens and the commons [der Gemeinde] as the Florentine guilds remained outside the feuds of the Guelf and Ghibelline families. It is probable that the dependent men were still as a whole at the disposal of the patricians" (I, 6 2 3 ) . /

On the one hand, historical processes are presupposed which transform a mass of individuals of a nation, etc., if not immediately into genuine free workers, at any rate into workers who are free Svvà\xei,⁽⁶⁾ whose only property is their labour capacity and the possibility of exchanging it for existing values. Such individuals confront all objective conditions of production as alien property, as their non-property, but at the same time as values which can be exchanged and therefore to a CERTAIN DEGREE appropriated by living labour. Such historical processes of dissolution can take the form of the dissolution of the dependent relationship which binds the worker to the soil and to the lord but which actually presupposes his ownership of the means of subsistence (which amounts in truth to the process of his "emancipation" from the soil). They can also take the form of the dissolution of those relations of landed property which constitute him as YEOMAN, as a free working petty landowner or tenant (colonus), i.e. as a free peasant. ^ The dissolution of the even more ancient forms of communal property and of real community needs no special mention.^- Or they can take the form of the dissolution of guild relations, which presuppose the worker's property in the instrument of labour and labour itself, determined as a certain form of artisanal skill, not merely as the source of property but as property itself. Lastly, they can take the form of the dissolution of the various client relationships, in which non-proprietors appear as co-consumers of the surplus produce in the retinue of their lord, and in return wear his livery, participate in his feuds, perform real or imaginary acts of personal service, etc.

Closer examination of all these processes of dissolution will show that relations of production are dissolved in which use value, i.e. production for immediate use, predominates and in which exchange value and its production presuppose the predominance of the other form. Thus in all the above relationships, deliveries in kind and labour services predominate over money payments and services remunerated by money. All this by the way. Closer examination will also reveal that all the relations dissolved were possible only at a certain level of development of the material (and therefore also of the mental) forces of production.

What immediately concerns us here is the following. The process of dissolution which turns a mass of individuals in a nation, etc., into 8"uvà|jieia free wage workers — that is into individuals obliged to work and to sell their labour merely by their lack of property — does not presuppose the disappearance of these individuals' previous sources of income and (in part) of their previous conditions of property. On the contrary, it presupposes that only their use has changed, that their mode of being has been transformed, that they have passed into other hands as a free fund, or perhaps that they have partly remained in the same hands. But this much is clear. The same process which has d'une manière OR d'une autre separated a mass of individuals from their previous affirmative relations to the objective conditions of labour, which has negated these relations and thereby transformed these individuals into free workers, that same process has liberated 8-uvà|xei these objective conditions of labour (land, raw material, means of subsistence, instruments of labour, money, or all of these) from their previous ties to the individuals who are now separated from them. They are still present, but present in a different form, as a free fund, one in which all the old political, etc., RELATIONS are obliterated, and which now confront those separated, propertyless individuals merely in the form of values, of values maintaining themselves and each other.

The same process which confronts the masses of free workers with the objective conditions of labour, has also put them face to face with these conditions as [V-ll] capital. The historical process was one of the separation of hitherto combined elements; its result is therefore not the disappearance of one of these elements, but that each of them appears negatively related to the other: the (potentially) free worker on the one hand, (potential) capital on the other. The separation of the objective conditions on the part of the classes which have been transformed into free workers, must appear just as much at the opposite pole as the attainment of independence by these same conditions.

If we consider the relationship of capital and wage labour not as something which is already of decisive importance, determining the character of production as a whole (for in this case capital, presupposed as the condition of wage labour, is the product of wage labour, and presupposed by wage labour itself as its condition, created by wage labour as its own presupposition), but as still in the stage of historical evolution — i.e. if we consider the original transformation of money into capital, the process of exchange between capital still existing only ôvvà|xei on the one hand, and the free workers existing ôvvà|xei on the other — then of course one cannot help making the simple observation, about which the economists make a great fuss — namely that the side which appears as capital must possess enough raw materials, instruments of labour and means of subsistence to enable the worker to live while producing, before production is completed.

This, moreover, takes the form that accumulation — an accumulation prior to labour and not arising from labour — must have taken place on the part of the capitalist, which enables him to set the worker to work and to maintain him in activity, as living labour capacity.⁽⁷⁾ This action of capital, which is independent of and not posited by labour, is then further transferred from this history of its origin into the present, and transformed into a factor of its reality and effectiveness, of its self-formation. Ultimately it is from this that the eternal right of capital to the fruit of other men's labour is derived, or rather the mode of appropriation of capital is deduced from the simple and "just" laws of the exchange of equivalents.

Wealth present in the form of money can only be exchanged for the objective conditions of labour, because and if these have been separated from labour itself. We have seen that money can in part be accumulated by the simple exchange of equivalents; however, this is so insignificant a source that historically it is not worth mention — assuming, that is, that this money has been gained by the exchange of one's own labour. It is rather money accumulated by usury — especially usury inflicted on landed property — and mobile (monetary) wealth accumulated through mercantile profits, that turns into capital in the proper sense, into industrial capital. We will have occasion to say more about both forms below — that is, in so far as they themselves appear, not as forms of capital, but as prior forms of wealth which are the prerequisites for capital.

As we have seen, it is inherent in the concept of capital — in its origin — that it begins with money, and therefore with wealth in the form of money. It is likewise inherent in it that it appears as emerging from circulation, as the product of circulation. Capital formation does not therefore arise from landed property (it could only arise from a tenant farmer in so far as he is also a trader in farm produce), nor from the guild (though the latter also provides a possibility), but from merchants' and usurers' wealth. But this wealth only encounters the conditions which permit the purchase of free labour, once free labour has been detached from its objective conditions of existence as a result of an historical process. Only then does it also become possible to buy these conditions themselves. Under the guild system, for instance, mere money (unless it is guild money, money of the masters) cannot purchase looms in order to put men to work on them. There are regulations determining how many looms one man may operate, etc. In short, the instrument itself is still so intimately linked to living labour, of which it appears as the domain, that it does not truly circulate.

What enables monetary wealth to turn into capital is, on the one hand, the availability of free workers, and on the other, the availability of means of subsistence, materials, etc., which were hitherto d'une manière ou d'une autre the property of the now objectiveless masses, but are now likewise free and for sale.

However, the other condition of labour — a certain craft skill, the existence of the instrument as a means of labour, etc.—is already available to capital in this, its preliminary or first period. This is partly the result of the urban guild system, partly of domestic industry, or of such industry as exists as an accessory to agriculture. The historical process is not the result of capital, but its prerequisite. By means of this process, the capitalist then insinuates himself as a (historical) middleman between landed property, or between property generally, and labour. History knows nothing of the cosy legend according to which the capitalist and the worker form an association, etc.; [V-12] nor is there a trace of it in the development of the concept of capital. Manufacture may develop sporadically in a context belonging to quite a different period, as e.g. in the Italian cities where it developed side by side with the guilds. But if capital is to be the generally dominant form of an epoch, its conditions must be developed not merely locally, but on a large scale. (It is no contradiction of this that during the dissolution of the guilds, individual guild masters may turn into industrial capitalists; however, in the nature of the phenomenon, the case is rare. All in all, the entire guild system — both master and journeyman — dies out, where the capitalist and the worker arise.)

It goes without saying, and is borne out by closer analysis of the historical epoch which we are now discussing, that the period of dissolution of the earlier modes of production and the older relations of the worker to the objective conditions of labour, is at the same time a period in which monetary wealth has already developed to a certain extent, and also one in which it is rapidly growing and expanding, through the same circumstances which accelerate this dissolution. Monetary wealth is itself one of the agents of that dissolution, just as that dissolution is the condition of its transformation into capital. But the mere existence of monetary wealth, even its conquest of a sort of SUPREMACY, is not sufficient for this dissolution into capital to occur. Otherwise ancient Rome, Byzantium, etc., would have concluded their history with free labour and capital, or rather, they would have begun a new [stage of] history. There the dissolution of the old relations of property was also linked to the development of monetary wealth — of commerce, etc. But IN FACT this dissolution did not result in industry but in the domination of the countryside over the city.

The original formation of capital does not, as is often supposed, occur in the form that capital amasses means of subsistence, instruments of labour and raw materials, in short, the objective conditions of labour detached from the soil and already fused with human labour.⁽⁸⁾ Capital does not create the objective conditions of labour.

Its original formation occurs simply because the historical process of the dissolution of the old mode of production enables value, existing in the form of monetary wealth, to buy the objective conditions of labour on the one hand, and to exchange the living labour of the now free workers for money on the other.

All these moments are already present. Their separation is itself an historical process, a process of dissolution, and it is this which enables money to turn into capital. In so far as money itself plays a part in the process, it is only to the extent that it is itself a highly energetic agent of separation, and to that extent contributes to the creation of the plucked, objectiveless, free workers. It is certainly not by creating the objective conditions for their existence, but by helping to accelerate their separation from them, their property-lessness.

For instance, when the great English landowners dismissed their RETAINERS, who had consumed with them the SURPLUS PRODUCE of their land; when their tenant farmers drove out the small cottagers, etc., then a mass of living labour power was thrown on to the labour market, a mass which was free in a double sense: free from the old client or bondage relationships and any obligatory services, and free also from all goods and chattels, from every objective and material form of being, free from all property. It was reduced either to the sale of its labour capacity or to beggary, vagabondage or robbery as its only source of income. History records that it tried the latter first, but was driven off this road and on to the narrow path which led to the labour market, by means of gallows, pillory and whip. In this way the governments, e.g. Henry VII, VIII, etc.,^[139] appear as conditions of the historical process of dissolution and as creators of the conditions for the existence of capital.

On the other side, the means of subsistence, etc., formerly consumed by the lords with their RETAINERS, could now be obtained by money, and money wanted to purchase them in order THROUGH THEIR INSTRUMENTALITY to purchase labour. Money had neither created nor accumulated these means of subsistence. They were already present, were consumed and reproduced, before they were consumed and reproduced through the mediation of money. The only difference was, that these means of subsistence were now thrown on to the exchange market. They had now been released from their immediate connection with the mouths of the RETAINERS, etc., and transformed from use values into exchange values, thus falling into the domain and under the [V-13] sovereignty of monetary wealth.

It was the same with the instruments of labour. Monetary wealth neither invented nor manufactured spinning wheel and loom. But once they had been separated from their land, spinners and weavers with their wheels and looms came under the sway of monetary wealth, etc. The only characteristic of capital is that it brings together the masses of hands and the instruments which are already there. It agglomerates them under its sway. This is its real accumulation; the accumulation of workers along with their instruments at particular points. We shall have to go into this more deeply when we come to the so-called accumulation of capital.

Admittedly, monetary wealth in the form of merchants' wealth had helped to accelerate the dissolution of the old relations of production, and had e.g. enabled the landowner (as A. Smith has already nicely demonstrated) to exchange his corn, cattle, etc., for imported use values, instead of squandering his own production with his RETAINERS, and measuring his wealth largely by their number.⁽⁹⁾ Monetary wealth had increased for him the significance of the exchange value of his revenue. It did the same for his tenant farmers, who were already semi-capitalists, though in a rather disguised manner.

The evolution of exchange value, which is favoured by the existence of money in the form of the merchant estate, dissolves the production which is orientated mainly towards immediate use value and the forms of property which correspond to it — relations of labour to its objective conditions — thus giving an impetus to the creation of the labour market (not to be identified with the slave market). However, even this effect of money is possible only on the basis of an urban industriousness, which rests not on capital and wage labour, but on the organisation of labour in guilds, etc. Urban labour itself had created means of production for which the guilds became as great an encumbrance as were the old relations of landed property for agricultural improvement, which was in turn partly the result of the greater sale of agricultural products to the cities, etc. The other circumstances which e.g. in the 16th century increased the mass of circulating commodities as well as of money, created new needs and therefore raised the exchange value of native products, etc., increased prices, etc.—all these fostered the dissolution of the old relations of production, accelerated the separation of the worker or the able-bodied non-worker from the objective conditions of his reproduction, and thus hastened the transformation of money into capital.

Nothing is therefore more foolish than to conceive of the original formation of capital as having created and accumulated the objective conditions of production—means of subsistence, raw materials, instruments — and then having offered them to workers stripped of them. For it was monetary wealth which had partly helped to strip of these conditions the labour power of the individuals capable of work. In part this process of separation proceeded without the intervention of monetary wealth. Once the formation of capital had reached a certain level, monetary wealth could insinuate itself as mediator between the objective conditions of life thus become free and the freed but also uprooted and dispossessed living labour powers, and buy the one with the other. As regards the formation of monetary wealth itself, prior to its transformation into capital, this belongs to the prehistory of the bourgeois economy. Usury, trade, urbanisation and the development of government finance which these made possible, play the main role here. Also hoarding by tenant farmers, peasants, etc., though to a smaller extent.

Here we can see at the same time how trade everywhere mediates exchange and exchange value, a mediation which we can call trade — money acquires an independent existence in the merchant estate, as does circulation in trade — and how the development of exchange and exchange value brings about both the dissolution of labour's relations of property in its conditions of existence, and of labour itself as one of the objective conditions of production. All the relations [thus dissolved] express a predominance of use value and of production orientated towards immediate use as well as of a real community which is still in being as an immediate prerequisite of production.

Production based on exchange value and a community based on the exchange of these exchange values, however much they may appear (cf. the previous chapter on money) to posit property as the result only of labour, and to posit private property in the product of one's own labour as a condition [of labour], and thus to posit labour as a general precondition of wealth, actually presuppose and produce the separation of labour from its objective conditions. An exchange of equivalents occurs, [but it] is merely the surface layer of a [system of] production which rests on the appropriation of alien labour without exchange, but under the guise of exchange. This system of exchange has capital as its basis. If we consider it in isolation from capital, as it presents itself on the surface, as an independent system, we are subject to a mere illusion, though a necessary one.

It is therefore no longer surprising to find that the system of exchange values — the exchange of equivalents measured by labour — turns into, or rather reveals as its concealed background, the appropriation of alien labour without exchange, the total separation of labour and property. For the domination of exchange value and of production producing exchange values presupposes [V-14] alien labour capacity as itself an exchange value. I.e. it presupposes the separation of living labour capacity from its objective conditions. It presupposes relating to these — or to its own objectivity — as to alien property; in a word, relating to them as capital. The golden age of labour emancipating itself is confined to those periods when feudalism was in decay, but still engaged in internecine conflict, as in England in the 14th and the first half of the 15th centuries. If labour is once again to relate to its objective conditions as to its property, another system must replace that of private exchange. For, as we have seen,⁽¹⁰⁾ private exchange posits the exchange of objectified labour against labour capacity, and therefore the appropriation of living labour without exchange.

Historically, the transformation of money into capital often assumes quite simple and concrete forms. Thus, for instance, the merchant sets to work a number of spinners and weavers, who up to then carried on these activities as a rural secondary occupation, and turns their secondary into their principal occupation, whereby he has brought them under his sway as wage workers. The next step is to remove them from their homes and to assemble them in a work place. In this simple process it is evident that the merchant has prepared neither raw material nor instrument, nor means of subsistence for the spinner or the weaver. All he has done is gradually to confine them to one sort of labour, in which they become dependent on selling, on the buyer, on the merchant, and in which they eventually produce only for and through him. Originally he has bought their labour only by the purchase of their product. As soon as they confine themselves to the production of this exchange value, and must thus directly produce exchange values and exchange their labour wholly for money in order to survive, they come under his sway. In the end, even the illusion that they are selling him products disappears. He purchases their labour and takes away first their property in the product, before long in the instrument as well, unless he lets them have it as their sham property in order to diminish his own production costs.

Manufacture in the strict sense of the term (not yet the factory) is one of the original historical forms in which capital appears at first sporadically or locally, alongside the old modes of production, but gradually destroying them everywhere. Manufacture arises where there is mass production for export, i.e. on the basis of large-scale maritime and overland trade, in its emporia, such as the Italian cities, Constantinople, the Flemish and Dutch cities, a few Spanish ones like Barcelona, etc. It does not initially embrace the so-called urban trades, but the rural secondary occupations, spinning and weaving, the sort of work which requires the least craft skill and technical training. Outside these great emporia, in which it finds the basis of an export market, and where production is, as it were, spontaneously orientated towards exchange value — i.e. manufactures directly connected with shipping, shipbuilding itself, etc.— manufacture first establishes itself not in the cities but in the countryside, in villages beyond the range of guild restrictions, etc. The rural secondary occupations provide the broad basis of manufacture, while urban trades require a high degree of progress in production before they can be organised on a factory basis. Likewise such branches of production as glassworks, metal factories, sawmills, etc., which right from the start require more concentration of labour power, utilise more natural power, and demand both mass production and a concentration of the means of labour, etc. Likewise papermills, etc.

On the other hand, the emergence of the tenant farmer and the transformation of the agricultural population into free day-labourers. Though this transformation in the country is the last to develop to its ultimate consequences and in its purest form, its origins are among the earliest.

The ancients, who never progressed beyond specifically urban craft industry, could therefore never evolve large-scale industries. For the first prerequisite of the latter is the involvement of the entire countryside in the production, not of use values, but of exchange values. Glassworks, papermills, ironworks, etc., cannot be organised on guild principles. They require mass production, sales on a general market, monetary wealth on the part of the entrepreneur. He does not create these conditions, whether subjective or objective; but under the old property and production relations these conditions cannot be brought together.

Gradually the dissolution of the relations of serfdom and the rise of manufacture transform all branches of production into branches operated by capital. Actually, the cities themselves contain one element for the formation of genuine wage labour— the day-labourers outside the guild system, the porters, etc.

[V-15] We have thus seen that the transformation of money into capital presupposes an historical process which has separated the objective conditions of labour from, and made them independent of, the worker. Once capital has come into being, the effect of its process is to subject all production to itself, and everywhere to develop and complete the separation between labour and property, between labour and the objective conditions of labour. In the course of the argument it will become clear how capital destroys craft labour, the smallholder working for himself, etc., and even itself in all those forms in which it does not appear in contradiction to labour: in small-scale capital, and the intermediate hybrid types between the old modes of production, which may have renewed themselves on the basis of capital, and the classical, adequate modes of capitalist production.

The only accumulation which is a prerequisite for the rise of capital is that of monetary wealth, which, when considered in and for itself, is entirely unproductive, arising only from and belonging only to circulation. Capital rapidly creates for itself an internal market by destroying all rural secondary industries, i.e. by spinning and weaving for all, providing clothing for all, etc.; in short by turning the commodities formerly produced as immediate use values into the form of exchange values. This process arises of itself from the separation of the workers from the land and from property (perhaps only servile property) in the conditions of production.

Though the urban trades are essentially based on exchange and the creation of exchange values, the immediate, principal object of this production is not enrichment or exchange value as exchange value, but the subsistence [of the producer] as an artisan, as a master craftsman, i.e. use value. Production is therefore everywhere subordinate to a presupposed consumption, supply to demand, and it expands only slowly.

The production of capitalists and wage workers is therefore a major product of the valorisation process of capital. Ordinary political economy, which considers only the objects produced, entirely forgets this. In as much as this process posits objectified labour as simultaneously the non-objectification of the worker, as the objectification of a subjectivity confronting the worker, as the property of someone else's will, capital is necessarily also a capitalist. The idea of some socialists that we need capital but not capitalists,^[90] is therefore completely false. It is inherent in the concept of capital that the objective conditions of labour — and these are its own product — acquire a personality confronting labour, or, and this amounts to the same thing, that they are posited as the property of a personality alien to the worker. The concept of capital contains the capitalist.

Still, this error is in no way greater than that of e.g. all those classicists who speak of the existence of capital in antiquity, and of Roman or Greek capitalists. This is merely another way of saying that in Rome and Greece labour was free, an assertion which these gentlemen would hardly wish to make. That we now not only describe the plantation-owners in America as capitalists, but that they are capitalists, is due to the fact that they exist as anomalies within a world market based upon free labour.

If our concern were with the word "capital", which does not occur in antiquity (though corresponding to the principalis summa

rex creditae,^[3] the Greek àpxoâa),⁽¹¹⁾ then the still nomadic hordes with their flocks on the steppes of Central Asia would be the greatest capitalists, for the original meaning of the word "capital" is cattle. Hence the métairie contract⁽¹²⁾ still common in the South of France because of the shortage of capital, is paradoxically called bail de bestes à Chaptel.d If one wants to indulge in a little bad Latin, then our capitalist or Capitales Hominese would be those "qui debent censum de capite" }

The conceptual analysis of capital entails difficulties which do not arise in that of money. Capital is essentially a capitalist; but at the same time it is capital as an element in the existence of the capitalist distinct from him, or as production in general. Thus we shall further find that in the term capital much is subsumed that does not appear to belong to the concept. E.g. capital is loaned. It is accumulated, etc. In all these relations it appears to be a mere thing, and entirely to coincide with the matter of which it consists. However, this and other problems will be clarified as the argument proceeds.

(Incidentally let us note for the sake of amusement: the good Adam Müller, who takes all figurative phrases very mystically, has also heard of living capital in ordinary life, as opposed to dead capital, and rationalises this theosophically.g King Athelstan could have enlightened him about this: "Reddam de meo proprio décimas Deo tarn in Vivente Capitali, quam in mortuis fructibus terrae." ⁽¹³⁾)

Money always retains the same form in the same substratum, and is therefore more readily conceived as a mere thing. But one and the same thing, a commodity, money, etc., can represent capital or income, etc. Thus even the economists recognise that money is nothing tangible, but that the same thing can be subsumed now under the determination of capital, now under some other and quite contrary determination, and accordingly that it is capital, or is not capital. It is thus evidently a relation and can only be a relation of production.

[V-16] ⁽¹⁴⁾^One further remark on the above: The exchange of equivalents, which appears to imply property in the product of one's own labour — and therefore also to imply that one must posit as identical appropriation by means of labour, the real economic process of appropriating, and property in objectified labour (what previously appeared as a real process here appears as legal relation, i.e. is recognised as a general condition of production, and hence legally recognised as such, posited as expression of the general will)—is reversed, manifests itself by a necessary dialectic as the absolute separation of labour and property and the appropriation of alien labour without exchange, without equivalent. Production based on exchange value, on the surface of which that free and equal exchange of equivalents takes place, is basically the exchange of objectified labour as exchange value for living labour as use value; or, as it may also be expressed, labour relating to its objective conditions — and hence to the objectivity created by labour itself — as to alien property: the alienation of labour. On the other hand, the condition of exchange value is that it is measured by labour time, and thus living labour — not its value — is the measure of values. It is a DELUSION to believe that production in all its forms and hence society rests upon the exchange of mere labour for labour. In the various forms in which labour relates itself to its conditions of production as to its property, the reproduction of the worker is in no way posited merely by labour, for his property relationship is not the result but the presupposition of his labour. In the case of landed property this is clearly the case. It must also become clear in the case of the guild system that the particular type of property which labour creates is not based merely upon labour or the exchange of labour, but upon the objective connection of the worker with a community and with conditions which he finds already in existence, from which he proceeds as his basis. They are also products of a labour, of world-historical labour, of the labour of the community. They are products of its historical development, which does not proceed from the labour of individuals or from the exchange of their labours. Therefore mere labour is not the presupposition of the realisation [of the product]. A condition in which labour is simply exchanged for labour — whether in the form of immediate activity or in that of product — implies the separation of labour from its original intertwinement with its objective conditions. As a result, labour appears on the one hand as mere labour, and on the other its product as objectified labour acquires a completely independent existence as value confronting [living] labour. The exchange of labour for labour—apparently the condition for the property of the worker—is based on his propertylessness.^

(The most extreme form of estrangement in which — in the relationship of capital to wage labour — labour, productive activity, appears to its own conditions and its own product, is a necessary transitional stage. This form therefore already contains in itself, but as yet only in inverted form, the dissolution of all conditions restricting production, and creates and produces the unconditional premisses for production, and hence all the material conditions for the total, universal development of the productive powers of the individual. This will be considered later.)

[ Circuit and Turnover of Capital]

We have seen how the true nature of capital only emerges at the end of its circulation?

We must now consider circulation itself or the turnover of capital. Initially, production appeared to lie beyond circulation and circulation beyond production. The circulation of capital— circulation posited as circulation of capital — embraces both moments. In that circulation, production appears both as the end point of circulation and as its point of departure and vice versa. Now both the independence of circulation and the remote isolation of production from it are reduced to a mere semblance.b

The circulation of money set out from an infinite number of points and returned at an infinite number of points. The point of return was in no way posited as the point of departure. In the circulation of capital, the point of departure is posited as the point of return, and the point of return as the point of departure. The capitalist himself is the point of departure and the point of return. He exchanges money for the conditions of production, produces the product, and valorises it, i.e. converts it into money and recommences the process. The circulation of money considered for itself is necessarily extinguished in money as a static thing. The circulation of capital is a continuously self-igniting process, divides itself into its different moments, and is a perpetuum mobile. On the side of the circulation of money price is posited purely formally, in so far as value is presupposed independently of that circulation. The circulation of capital posits price, not only formally but really, in so far as it posits value.

If value itself appears within it as presupposition, it can only be as value posited by another capital. The circulation of money follows a path whose width has been measured in advance, and the circumstances which accelerate or retard it are external impulses. Capital in its circulation expands both itself and [V-17] its path, and the rapidity or slowness with which it circulates is one of the intrinsic moments of that path. It is qualitatively changed in circulation, and the totality of the moments of its circulation are themselves the moments of its production — of its reproduction as well as of its new production.

/ W e have seen how, at the end of the second curcuit, i.e. [at the stage] of surplus value which is employed as surplus capital, the illusion disappears that the capitalist exchanges with the worker anything other than a part of the latter's own, objectified labour. Within the mode of production already founded on capital itself, the part of the individual capital which represents raw material and instrument of course appears for that capital as a value presupposed to it and similarly presupposed to the living labour which it purchases. These two items turn out to be posited by alien capital, hence again by capital, but by another one. One capitalist's raw material is the other's product. One capitalist's product is the other's raw material. One capitalist's instrument is the other's product, and may even serve as raw material for the production of another instrument. Thus what appears as a presupposition in the individual capital, what we have called constant value, is nothing but the presupposition of capital by capital, i.e. the capitals in the different branches of industry posit one another as presupposition and condition. Each capital considered for itself can be resolved into dead labour as value become independent vis-à-vis living labour. In the last analysis, none of them contains anything other than labour — apart from the natural substances, which do not possess value. The discussion at this point must not be diverted by the introduction of many capitals. Indeed, the relationship of the many capitals will become clear when what they all have in common, their quality of being capital, has been analysed.^

The circulation of capital is simultaneously its becoming, its growth, its life-process. If anything can be compared to the circulation of blood, it was not the formal circulation of money, but the circulation of capital, which really has a content of its own.

If circulation presupposes production at all points, and is the circulation of products, whether money or commodity — and products everywhere emerge from the process of production, which is itself the process of capital — it follows that the circulation of money itself is determined by the circulation of capital, while it previously appeared to run alongside the process of production. We shall return to this point.

If we now consider circulation or the turnover of capital as a whole, the process of production and circulation itself appear as the two great distinctions within that process, both as moments of capital's circulation. How long capital remains within the sphere of the process of production depends upon the technological conditions of the process; and the time capital stays in this phase directly coincides with the development of the productive forces— however much its length must vary according to the type of production, its object, etc. The duration here is simply the labour time necessary for the manufacture of the product. (Wrong!) ^[14]° The shorter the labour time necessary, the greater is relative surplus value, as we have seen. It is the same if less labour time is required for a given quantity of products, or if in a given labour time more finished products are supplied. The reduction of the time during which a certain amount of capital remains in the process of production and is thus taken out of circulation proper, EMBARGOED as it were,a coincides with the reduction of the labour time necessary for the manufacture of a product, [which comes] with the development of the productive forces, both through the application of natural forces and machinery, and through the natural powers of social labour — the agglomeration of workers, combination and division of labour. Hence in this respect, no new moment seems to enter the process. However, if we remember that the part of the individual capital which constitutes raw material and instrument (means of labour) is the product of an alien capital, it becomes clear that the speed with which it can renew the process of production is at the same time determined by

Marx has "embarked".— Ed.

the development of the productive forces in all other branches of industry. This becomes quite clear if one supposes the same capital to produce its raw materials, its instruments and its final products. The length of time during which capital remains in the phase of the production process, itself becomes a moment of circulation, if we presuppose various capitals. But we are not yet concerned with the many capitals. This moment therefore does not belong here.

The second moment is the time which elapses between the completed transformation of capital into the product and its transformation into money. Obviously, the frequency with which capital can recommence the process of production, of self-valorisation, in a given period of time depends upon the speed at which this phase is run through, or on its duration.

If a capital of originally, say, 100 thaler turns over four times a year, and each time it is turned over at a profit of 5% of its value without the re-capitalisation of the new value, it is the same as if a capital 4 times as large, 400, at the same percentage, were to turn over once in one year. [The profit] in each case 20 thaler.

The velocity of the turnover — assuming that the other conditions of production remain the same — therefore compensates for the [smaller] volume of capital. In other words, if [V-18] a value 4 times smaller is realised as capital 4 times in the same period in which a 4 times greater value is realised as capital only once, the profit — the production of surplus value — on the part of the smaller capital is as great—at least as great—as on the part of the larger one. We say "at least", although it may actually be greater, because the surplus value itself can be employed as surplus capital.

E.g. assume that the profit on a capital of 100 is 10% each time it is turned over (for the sake of the calculation this form of surplus value is anticipated). Then [with 4 turnovers a year] at the end of the first three months the capital of 100 would be 110; at the end of the second three months 121; at the end of the third three months 133 Vioî and at the end of the fourth three months 146^[41]/ioo- Yet a capital of 400 turned over once a year [at the same rate of profit] would only be 440. In the first case the profit=46^[41]/ioo. in the second case only=40. (The presupposition is incorrect in so far as the rate of profit changes with each increase in the volume of capital. But the issue here is not to show how much more than 40 it brings in, but the fact that in the first case it brings in more than 40 — and it does.)

In our discussion of the circulation of money⁽¹⁾ we have already encountered the law of the compensation of speed by mass and vice versa. It applies as much to production as it does to mechanics. We shall have to return to it when we come to discuss the equalisation of profit rates, prices, etc. The question which concerns us here is this: does not a moment of value determination come in here which is independent of labour, a moment which does not directly take its origin from labour but from circulation itself?

^"The role of credit in ironing-out differences in the turnover of capital does not belong here yet. But the question itself does belong here, because it arises from the simple concept of capital — considered in general.^

The greater frequency of the turnover of capital in a given period of time resembles the more frequent repetition of the harvest in the more southerly countries compared to the more northerly ones in the course of the natural year. As already pointed out above,^[3] we are here completely abstracting from the difference in the time during which capital must remain in the phase of production — in the process of productive valorisation. Just as the corn put as seed into the soil loses its immediate use value, is devalued as immediate use value, capital is devalued during the period between the completion of the process of production and its reconversion into money and thence back into capital.^The speed with which a particular capital can reconvert itself from its form as money into the conditions of production — the worker himself is not subsumed under these conditions of production, as in slavery, but rather the exchange with him— depends both on the speed and continuity of the production sustained by the other capitals which supply this particular capital with its raw material and instrument, as well as on the availability of workers. With regard to the latter, a relative surplus population is the most favourable condition for capital.^

^Quite apart from capital a's production process, the speed and continuity of production process b appears as a moment which conditions the reconversion of capital a from the form of money into that of industrial capital. The duration of the process of production of capital b thus appears as a moment of the rapidity of the process of circulation of capital a. The duration of the production phase of the one determines the speed of the circulation phase of the other. Their simultaneity is a condition for the circulation of a not to be obstructed — its own elements for which it must be exchanged must simultaneously be thrown into production and circulation.

E.g. in the last third of the 18th century, hand-spinning could not supply the required volume of raw material for weaving — or, which is the same thing, spinning could not put flax or cotton through the process of production, convert them into yarn, with the required simultaneity or simultaneous speed. The result was the invention of spinning machinery which supplied an incomparably greater output in the same labour time or, which is the same thing, required an incomparably shorter labour time to produce the same output, required an incomparably shorter stay [of the raw material] in the spinning process. All the moments of capital which appear involved in it, if it is considered according to its general concept, acquire an independent reality, and moreover become manifest only when it appears in its reality as many capitals. Only then does its internal living structure, which is created within and through competition, develop on a broader scale, /f

If we consider the turnover o.f capital in its entirety, there appear to be four moments of it; or the two major moments of the process of production and the process of circulation considered as two moments, each of which contains a duality. We can begin our discussion with either circulation or production. This much has already been said that circulation itself is a moment of production, since only through circulation does capital become capital; and production is merely a moment of circulation, in so far as circulation itself is considered as the totality of the process of production.

The moments are: (I) The real process of production and its duration. [V-19] (II) Conversion of the product into money. Duration of this operation. (Ill) Conversion of the money into the appropriate proportions of raw material, means of labour and labour, in short into the elements of capital as productive capital. (IV) The exchange of a part of capital for the living labour capacity can and must be considered a special moment of the process, since the labour market is regulated by other laws than the PRODUCE MARKET, etc. In the labour market, population is the main factor, not absolute but relative population. Moment (I) does not come into consideration here, as already stated, since it coincides with the conditions of valorisation in general. Moment (III) can only be considered when we are dealing not with capital in general but with many capitals. Moment (IV) belongs to the section on wages, etc.

Here we are only concerned with moment II. In the circulation of money, there was only a formal alternation of exchange value as money and commodity. Here, money and the commodity are a condition of production; in the final analysis, the process of production. The very contents of the moments [of circulation] are different here. The difference in capital turnover, as it is posited in II, since it depends neither on greater difficulty in the exchange with labour, nor on delays resulting from the non-simultaneous presence of raw material and means of labour in circulation, nor on the different duration of the production process, could only be due to greater difficulties in valorisation. This is obviously not an immanent case arising from the relationship itself, but coincides here, where we are considering capital in general, with what we have said about devaluation as a concomitant of valorisation.⁽²⁾

No business is founded on the principle that it can sell its products with greater difficulty than another business. If this [difficulty] resulted from a smaller market [for the product], a smaller capital — not a larger, as assumed — would be invested in it than in the business with a larger market. It could be connected, however, with the greater geographical distance of the market and hence the later RETURN. The longer time required by capital a for its valorisation is due here to the greater geographical distance it must travel after the process of production in order to be exchanged as C for M.

But suppose we have a product which is produced for export to China: is it not reasonable to argue that the product is only finished, only emerges from its process of production, when it has actually reached the Chinese market? The costs of valorisation would rise by the costs of transporting it from England to China. (We cannot yet discuss here the compensation for the longer fallow period of the capital, because this presupposes the secondary and derived forms of surplus value, i.e. interest.) In this case the production costs would resolve into the labour time objectified in the immediate process of production+the labour time contained in transport.

The first question which now arises is this: according to the principles we have so far established, can a surplus value be extracted from the transport costs? Let us deduct the constant part of capital used up in transporting [the commodity], i.e. ship, wagon, etc., and everything that pertains to their application, since these elements are not relevant to the question and it is immaterial whether we posit them as^O or=x. Now, is it possible that surplus labour is embodied in the transport costs, and that capital can extract surplus value from them? The question may be simply answered by another question: what is the necessary labour or the value in which it is objectified?

The product must pay for (1) its own exchange value, which is the labour objectified in it; (2) the surplus time which the sailor, the carrier, etc., employs in transportation. Whether or not he can extract this depends on the wealth of the country to which he exports the product and on the need for it, i.e. on the use value which the product has in that country. In direct production it is clear that all the surplus labour which the manufacturer compels the worker to perform is surplus value for him, for it is labour objectified in new use values which costs him nothing. But clearly he cannot stretch the time used for transporting [the product] beyond the time actually required. If he did so, he would throw labour time away, not valorise it, i.e. he would not objectify it in a use value. If the sailor, the carrier, etc., needs to work for only half a year to obtain a year's subsistence (assuming that this is GENERALLY the ratio of necessary [to total] labour), the capitalist employs him for a whole year and only pays him for half a year. By adding a whole year's labour time to the value of the transported products but paying only for half a year, he gains a surplus value of 100% on the necessary labour. It is the same as in direct production, and the original surplus value on the transported product can only derive from the fact that a part of the transport time worked by the workers is not paid for, because it is surplus time, time over and above that which is necessary for them to live.

That a single product could be made so dear by transport costs that it could not be exchanged — because of the disproportion between the value of the product and its additional value as a transported product, the latter being a quality which is extinguished in it as soon as it has reached its destination — does not affect the matter. If a manufacturer set the whole of his machinery into operation to spin 1 lb. of TWIST, the value of this lb. would likewise rise to such an extent that it would hardly find a ready sale. The rise in the price of foreign products and their limited consumption in the Middle Ages, etc., stem precisely from this cause.

Whether I extract metals from the mines or take commodities to the places where they are consumed, both equally represent a spatial [V-20] movement. Improvements in the means of transport and communication likewise fall into the category of the development of the productive forces in general. This is not the place to discuss the fact that the extent to which products can bear transport costs may depend on their value; or that, moreover, commercial traffic on a massive scale is necessary if transport costs are to be reduced — a ship of 100 tons capacity can carry 2 or 100 tons of freight at the same production costs, etc.—and if means of communication are to be commercially profitable, etc. (Nevertheless, it will be necessary to devote a separate section to the means of communication, since they constitute a form of capital fixe, which has its own laws of valorisation.)

If we assume that the same capital performs the functions of both production and transportation, both would be subsumed under immediate production, and circulation as we have considered it so far, i.e. conversion of the product into money as soon as the product has acquired its final form for use, the form in which it is suitable for circulation, would begin only when the product had been brought to its place of destination. This capitalist's delayed RETURN as compared to that of another, who sold his product locally, would resolve into another form of greater use of capital fixe, with which we are not as yet concerned. Whether capitalist A needs 100 thaler more for his instrument than B or whether he must spend 100 thaler more on bringing his product to its place of destination, to its market, is the same thing. In both cases greater capital fixe is required [by A], more means of production which are consumed in direct production. Thus from this aspect no immanent CASE [belonging to circulation proper] would be posited here; it would have to be considered in connection with the distinction between capital fixe and capital

circulant.

Nevertheless, one additional moment does enter here: the costs of circulation which are not contained in the simple concept of circulation and do not as yet concern us. The costs of circulation which derive from circulation as an economic act — as a relation of production, not as directly a moment of production as is the case of the means of transport and communication, can be properly discussed only when we come to interest and especially to credit. Circulation, in the sense in which we are considering it, is a process of transformation, a qualitative process of value, as it appears in the different forms of money, production process, product, reconversion into money and surplus capital. This process of transformation as such concerns us here in so far as this transition from one determination into the other produces new determinations. The costs of circulation are not necessarily included e.g. in the transition from product to money. They could be = 0.

However, in so far as circulation itself involves costs, requires surplus labour, it appears as itself included in the process of production. In this respect circulation appears as a moment of the direct production process. In the case of production directed towards immediate use, and exchanging only the surplus, the costs of circulation are incurred only in relation to that surplus, not to the main product. The more production comes to be based on exchange value, and thus on exchange, the more important for production do the physical conditions of exchange become — the means of communication and transport. By its very nature, capital strives to go beyond every spatial limitation. Hence the creation of the physical conditions of exchange — of the means of communication and transport — becomes a necessity for it to an incomparably greater degree: space must be annihilated by time. In so far as the immediate product can be valorised on a mass scale in distant markets only to the extent that transport costs decline, and in so far as, on the other hand, means of transport and communication themselves can only function as spheres of valorisation, of labour organised by capital, to the extent that commercial traffic takes place on a massive scale — whereby more than the necessary labour is replaced — the production of cheap means of transport and communication is a condition of production based on capital, and therefore they are produced by it. All the labour which is required to put the finished product into circulation — it is in economic circulation only when it is on the market — is regarded by capital as a barrier to be overcome. Likewise all labour required as condition for the process of production (such as e.g. costs incurred to ensure the security of the exchange, etc.).

Water transport, along a self-propelling route, is the means of transportation xai' è^ox^v'⁽³⁾ of all trading peoples. On the other hand, roads for communication were originally the responsibility of the community; later, for a long time, they became the responsibility of the government. They represented pure deductions from production, coming out of the common surplus product of the country but not constituting a source of its wealth, i.e. they did not cover their production costs. In the original Asiatic SELF-SUSTAINING communities there was on the one hand no need for roads; on the other hand, their lack kept the communities totally isolated, and hence constituted an essential moment of their unchanging survival (as in India). The building of roads by means of forced labour or through taxation, which is another form of forced labour, amounts to the compulsory conversion of a part of surplus labour or the surplus product of the country into roads. If an individual capital is to assume that function, i.e. to produce the conditions of the process of production which do not fall immediately within that process, it must be possible for the labour [involved in road building] to be valorised.

A definite road between points A and B (assuming that the land [on which it is constructed] does not cost anything) contains [V-21] a definite quantity of labour, and hence of value. It is immaterial whether the capitalist or the State has organised its construction. Does the capitalist therefore derive a profit from it by creating surplus labour and therefore surplus value?⁽⁴⁾ First strip off what is PUZZLING about the road and arises from its nature as capital fixe. Imagine that the road could be sold AT ONCE, like a coat or a ton of iron. If it takes, say, 12 months to produce the road, its value=12 months. If the GENERAL STANDARD OF LABOUR is such that the worker can live [for a year] on, say, six months' objectified labour, then, if the worker built the entire road, he would produce surplus value to the amount of 6 months of labour for himself. Or if the community built the road, and the worker wished to work only for the necessary time, another worker would have to be engaged for six months. But the capitalist compels the one worker to work for 12 months and pays him 6. The part of the road's value which contains the worker's surplus labour constitutes the profit of the capitalist. The specific form in which the product appears need in no way upset the foundation of the theory of value through objectified labour time.

But the question is precisely: can the capitalist valorise the road, can he realise its value by means of exchange? This question can of course be asked about any product, but it assumes a special form in relation to the general conditions of production. Let us assume that the road is not valorised. But it is built because it represents a necessary use value. How does the matter stand then?

It must be built and paid for — in so far as its production costs must be given in exchange for it. It only comes into existence through the consumption of a certain amount of labour, means of labour, raw materials, etc. It makes no difference whether it is built by means of forced labour or taxes. It is built only because it is a necessary use value for the community, because it needs it à

tout prix.a

This is certainly a surplus labour which the individual must perform over and above the labour directly necessary for his own subsistence, whether it takes the form of forced labour or the mediated form of taxes. But in so far as the road is necessary for the community and for each individual as a member of it, it is not surplus labour which he performs but a part of his necessary labour, of the labour which is necessary for him to reproduce himself as a member of the community and hence to reproduce the community, which is itself a general condition of his productive activity.

If the labour time were wholly consumed in direct production (or, indirectly expressed, if it were impossible to levy surplus taxes for this particular purpose), the road would have to remain unbuilt. If the whole society were considered as a single individual, necessary labour would consist of the sum of all the particular functions of labour which are made independent by the division of labour. The single individual would have to spend e.g. so much time for agriculture, so much for industry, so much for trade, so much for the production of instruments, and so much, to return to our bugbear, for road construction and means of communication. All these necessary activities resolve into certain quantities of labour time which must be directed to different purposes and spent on particular activities. How much labour time can be employed depends on the amount of labour capacity ( = the mass of able-bodied individuals who constitute the society) and on the development of the productive power of labour (on the quantity of products which it can produce in a given time).

Exchange value, which presupposes a more or less developed division of labour, depending on the level of exchange itself, also presupposes that, instead of the single individual (the society) performing different kinds of labour, spending his labour time in different forms, the labour time of every individual is devoted solely to the necessary particular functions. When we speak of necessary labour time, the particular separate branches of labour appear as necessary [for one another]. This reciprocal necessity is mediated by exchange on the basis of exchange value, and is manifested precisely by the fact that each particular objectified labour, each particular specified and materialised labour time is exchanged for the product and symbol of general labour time, of objectified labour time pure and simple, i.e. for money, and can then be exchanged again for any particular labour. This necessity is itself subject to change, in that needs are produced just as much as products and the various craft skills. The scope of these needs and necessary labours may expand or contract.

The more the needs which are themselves historically produced, the needs produced by production itself, the social needs which are themselves the OFFSPRING of SOCIAL PRODUCTION and INTERCOURSE — the more these needs are posited as necessary, the higher the development of real wealth. Considered as physical matter, wealth consists merely in the multiplicity of needs. The crafts themselves do not appear necessary a l o n g s i d e SELF-SUSTAINING AGRICULTURE, where spinning, weaving, etc., are carried on as domestic sidelines. But if e.g. agriculture itself [V-22] is based upon scientific cultivation; if it requires machines, chemical fertilisers available through trade, seeds imported from distant countries, etc.; if — as all this implies — rural patriarchal manufacture has disappeared, then the machine-making factory, foreign trade, crafts, etc., appear as ' needs for agriculture. Perhaps guano can be obtained for it only by exporting silks. Thus silk manufacture no longer appears as a luxury industry, but as an industry necessary for agriculture. In this case, agriculture no longer finds the conditions for its own production within itself, provided by nature. These now exist outside it as independent industries, and with this outside existence, the whole complex set of interconnections in which these alien industries exist is drawn into the sphere of the conditions of agricultural production. It is chiefly and essentially owing to this that what earlier appeared as luxury is now necessary, and that so-called luxury needs appear e.g. as a necessity for the most natural industry rooted in the most basic natural need.

It is the tendency of capital to remove the natural ground from the foundation of every industry, and to transfer the conditions of its production outside it to a general context. Hence the conversion of what previously appeared superfluous into neces-sities, things whose necessity is a product of history. Universal exchange itself, i.e. the world market and hence the totality of activity, intercourse, needs, etc., of which it consists, becomes the universal foundation of all industries. Luxury is the opposite of natural necessities. Necessary needs are those of the individual reduced to a natural subject. The development of industry abolishes both natural necessity and luxury — though in bourgeois society it does so only in antithetical form, in that it itself only posits a particular social standard as the measure of what is necessary as against what is luxury.

At what point are these questions of the system of needs and system of labours to be discussed? Will emerge in due course.

Let us return to our [example of the] road. If it can be built at all, it proves that society possesses the labour time (living and objectified labour) required for that purpose.

^ I t is of course assumed here that society follows a correct instinct. It could consume its seed and let its agricultural land lie fallow, in order to construct roads. But then it would not have accomplished the necessary labour, because by this labour it would not reproduce itself, not maintain itself as living labour capacity. Or living labour capacity could also be directly murdered, as Peter I did in order to build St. Petersburg. This sort of thing does not belong here . ^

Why is it then that, when production based on exchange value and the division of labour develops, road construction does not immediately become the private business of individuals? And it is not private business when it is carried on by the State by means of taxes. D'abord, society, the associated individuals, may possess surplus time with which to construct the road, but only in association. The association is always the aggregation of that part of labour capacity which the individual can employ on road construction apart from his particular work. But it is not merely its aggregation. The unification of their forces increases their productive power. But this does not mean at all that the labour capacity of the individuals numerically added together, but not employed in working together, would be the same. For to the sum of individual labour capacities is added that surplus which only exists in and through their associated, combined labour. Hence the forcible herding together of the people in Egypt, Etruria, India, etc., for compulsory labour on buildings and public works. Capital brings about the same concentration in another way, by the manner of its exchange with free labour.

^ That capital is not concerned with isolated but with combined labour, just as it is in and for itself a social, combined force, is a point which can perhaps already be discussed here, in the general history of the emergence of capital.^ Secondly: The population may have developed to a sufficiently high level on the one hand, and on the other the aid given to it by the application of machinery, etc., may have been developed to such an extent that the productive power arising simply from material concentration on a mass scale—and in ancient times it was always this massive effect of the compulsory concentration of labour [which counted]—is now superfluous, and a relatively smaller mass of living labour is necessary.

^ The greater the extent to which production is still based on mere manual labour, on the use of muscle power, etc., in short on the physical exertion and labour of individuals, the more does any increase in productive power consist in their working together on a mass scale. In the semi-artistic crafts, the opposite aspects become important, particularisation and individualisation, the skilfulness of individual, uncombined labour. Capital in its true development combines [V-23] mass labour with skill, but in such a way that the former loses its physical power, and skill resides not in the worker, but in the machine and in the scientific combination of both in the FACTORY operating as a single whole. The social mind of labour acquires an objective existence outside the individual workers.^

A particular class of road workers which is employed by the State can emerge.⁽⁵⁾ Or a part of the population who happen to be unemployed at the moment can be used for that purpose, working under a number of master-builders, etc. The latter, however, do not work as capitalists but as more highly educated MENIALS. (About the relation of this skilled labour, etc., later.) The workers are wage workers in this situation, although they are not employed as such by the State, but as MENIAL SERVANTS.

Now, for the capitalist to undertake road construction as a business, at his expense, different conditions are necessary, which all amount to this, that the mode of production based on capital must have already been developed to its highest level. ^ I f the State organises such projects through State contractors, then it is still indirectly effected through forced labour or taxes.^

Firstly: Large-scale capital is presupposed, capital concentrated in the hands of the capitalist, for him to be able to undertake projects of such dimension and where turnover, and therefore valorisation, are going to be so slow. Hence mostly joint-stock capital, the form in which capital has worked itself through to its ultimate form, in which it is capital not only in itself, in its substance, but in which it is posited in its form as social power and product.

Secondly: It must yield interest, not profit. (It can yield more than interest, but that is not necessary.) This point need not be further discussed here.

Thirdly: The presupposition of a sufficient volume of traffic— above all, commercial and industrial traffic — for the road to be profitable, i.e. for the price demanded for the use of the road to be worth that much exchange value to the producers [using the road], or for the road to supply a productive force for which they can pay so much.

Fourthly: A part of the wealth consumed as income must be available for investment in these means of locomotion.

But the two most important presuppositions are: (1) the availability of capital which can be employed for this object in the required quantity and which contents itself with receiving interest; (2) it must be worth it for the productive capitals, for industrial capital, to pay the price of passage. Hence e.g. the first railway between Liverpool and Manchester.^[141] It had become a necessity of production for the Liverpool COTTON-BROKERS and even more for the Manchester MANUFACTURERS.

^Competition may easily create the necessity for e.g. a railway in a country where the existing level of development of the productive forces would not otherwise make it urgent. The effect of competition among nations belongs to the section on international trade. The civilising effects of capital become especially evident h e r e . ^

Capital as such — assuming its availability on the necessary scale — will only construct a road when its construction has become a necessity for the producers, especially for productive capital itself; when it has become a prerequisite for the capitalist making a profit. Then the road will also be profitable. But in these cases a large volume of traffic is already presupposed. It is the same presupposition become dual: on the one hand, the wealth of the country sufficiently concentrated and converted into the form of capital to undertake such operations as processes of the valorisation of capital; and on the other hand, the volume of traffic sufficient, and the barrier imposed on capital by the lack of means of communication sufficiently felt as such, to enable the capitalist to realise the value of the road as a road (in a piecemeal fashion, as it is used over a period of time).

All general conditions of production like roads, canals, etc., whether they facilitate circulation, perhaps even make it possible for the first time, or whether they also increase productive power (like the irrigation systems, etc., constructed in Asia and, incidentally, in Europe as well, by governments), will only be undertaken by capital rather than by the government, which represents the commonality as such, where the highest level of development of production based on capital has been attained. The separation of travaux publics'" from the State and their migration into the domain of works undertaken by capital itself indicates the degree in which the real commonality has constituted itself in the form of capital. A particular country, e.g. the UNITED STATES, may sense the importance of railways for production. Yet, the immediate advantage [V-24] accruing to production may be too small for the outlay to appear as anything but à fonds perdu.⁽⁶⁾

In that case capital shifts the burden onto the shoulders of the State; or, where the State still traditionally occupies a position supérieure to capital, the State still has the privilege and the will to force the generality of capitalists [to put] a part of their income, not of their capital, into such generally useful works, which at the same time appear as general conditions of production, and therefore not as the particular conditions for any particular capitalist. And so long as capital has not assumed the form of joint-stock capital, it seeks only the particular conditions of its valorisation, while shifting the burden of the communal conditions onto the whole country as national requirements. Capital only undertakes projects which are profitable, profitable, that is, from its own point of view.

Admittedly, it also speculates unsoundly, and is bound, as we shall see, to do so. In such cases, it undertakes investments which are not profitable and only yield a return once they have been depreciated to a certain degree. Hence the many undertakings where the first mise de capital is à fonds perdu⁽⁷⁾ and the first investors go bankrupt. The advanced capital yields a profit only at second or third hand, when it has been reduced by depreciation. Incidentally, the State itself and all that pertains to it belongs to these deductions from revenue, is part, as it were, of the costs of consumption for individuals, part of the social production costs. A road may itself so increase the productive forces that it creates a traffic through which it becomes profitable. There are works and investments which may be necessary without being productive in the sense of capital, i.e. without the surplus labour contained in them being realised as surplus value by means of circulation and exchange.

If a worker works on a road e.g. for 12 hours per day in a year, and if the generally necessary labour time on average=6 hours, he has worked a surplus labour of 6 hours. But if the road cannot be sold at [the value of] 12 hours [of objectified labour time], perhaps only at 6, its construction is not a suitable undertaking for capital, and road construction is not productive work for it. Capital must be able to sell the road (the type of sale and the length of time required for it are irrelevant here) in such a way that the necessary labour as well as the surplus labour is realised, or in such a way that it receives out of the general fund of profits, of surplus values, a sufficient share to make it the same as if this capital had [actually] created surplus value. This relation to be analysed later, in connection with profit and necessary labour.

Capital has attained the highest level of development when the production of the general conditions of the social process of production is not financed by deductions from the social revenue, i.e. out of taxation, where revenue and not capital appears as the LABOUR fund, and where the worker, though a free wage worker like all the others, stands economically in a different relation, but by capital as capital. This demonstrates, on the one hand, the degree to which capital has subjected to itself all the conditions of social production, and hence, on the other hand, the extent to which social reproductive wealth is capitalised and all needs are satisfied by means of exchange, even the socially posited needs of the individual, i.e. the needs which he feels and satisfies, not as an isolated individual in society, but socially, together with others— which by their very nature can only be satisfied socially — the extent to which even these are not only satisfied but also produced by exchange and individual exchange at that.

In the case of the above-mentioned road, its construction must be sufficiently profitable for a certain amount of labour time transformed into road to reproduce the worker's labour capacity in exactly the same way as if he had converted it into agriculture. Value is determined by objectified labour time, whatever the form it takes. But whether this value can be realised depends on the use value in which it is embodied. Here it is assumed that the road meets a need of the community, its use value is therefore presupposed. On the other hand, for capital to undertake the construction of the road, it is a prerequisite that not only the necessary labour time will be paid for [by the users], but also the surplus labour time put in by the worker — for that is the source of capital's profit. (The capitalist often enforces this payment by means of protective tariffs, monopoly, State compulsion, while under conditions of free exchange the individual exchangers would pay at most for the necessary labour.)

It is quite possible for surplus labour time to have been put in without being paid for (after all, this can also happen to any individual capitalist). Where capital is dominant (just as where slavery and serfdom or compulsory labour of any kind is dominant) the absolute labour time of the worker is posited as the condition which he must meet, if he is to be allowed to perform necessary labour time, i.e. if he is to be allowed to realise the labour time necessary for the maintenance of his labour capacity in use values for himself. In every type of labour, competition then brings it about that he must work the full time — i.e. surplus labour time. But it may happen that this surplus labour time is not exchangeable, even though it is embodied in the product. Now for the worker himself — as compared with the other wage workers — it is [still] surplus labour. But for the employer it is labour which has, to be sure, a use value for him, like e.g. his cook, but no exchange value. Hence the entire distinction [V-25] between necessary and surplus labour time does not exist.

Labour may be necessary without being productive. All general, social conditions of production — as long as they cannot as yet be produced by capital as such and under its conditions — are consequently paid for out of a part of the revenue of the country, by the government's treasury, and the workers do not appear as productive workers even though they increase the productive power of capital.

The result of our digression is, incidentally, that the production of the means of communication, the physical conditions of circulation, are put into the category of the production of capital fixe, and hence do not constitute a special CASE. But a prospect has thereby incidentally opened before us, a prospect which at this point cannot yet be clearly depicted, of a specific relation of capital to the communal, general conditions of social production, as distinct from the conditions of a particular capital and its particular process of production.

Circulation proceeds in space and time. The spatial condition, the conveyance of the product to the market, belongs, economically considered, to the process of production itself. The product is not really finished until it is on the market. The movement by which it gets there, represents a part of its costs of production. It does not constitute a necessary moment of circulation conceived as a particular process of value, for a product may be purchased and even consumed where it is produced. But this spatial moment is significant in so far as the expansion of the market, the exchangeability of the product, are connected with it. The reduction of the costs of this real circulation (in space) belongs to the development of the productive forces by capital, the diminution of the costs of its valorisation. In certain respects, as an external condition for the existence of the economic process of circulation, this moment can also be reckoned among the production costs of circulation, so that, with respect to this moment, circulation appears as a moment not merely of the production process in general, but of the direct production process as well. In any case, what appears here is the determination of this moment by the general degree of development of the productive forces and of production based upon capital in general.

This spatial moment, the conveyance of the product to the market, could be more precisely viewed as the conversion of the product into a commodity, for it is a necessary condition for its circulation, except where the place of its production is itself the market. It is a commodity only when put on the market. (WHETHER OR NOT this constitutes a particular moment is a matter of chance. If capital works to order, neither this moment nor the transformation into money exist as a particular moment for it. But working to order, i.e. supply which corresponds to a previously stated demand, is not a general or dominant situation, does not correspond to large-scale industry, and in no way arises as a condition [of the production process] from the nature of capital.)

Secondly, the temporal moment. This is an essential part of the concept of circulation. Suppose the act of converting the commodity into money is fixed by contract, this costs time — time involved in counting, weighing, measuring. The abridgement of this moment similarly constitutes an increase in productive power. This is time conceived only as the external condition for the transition from the form of commodity into that of money. The transition itself is presupposed. We are concerned with the time which elapses during this presupposed act. This belongs to the costs of circulation. There is also another thing: the time which elapses before the commodity is transformed into money; or the time during which it remains a commodity, only potential, not real, value. This is pure loss.

The conclusion from all that has been said is that circulation appears as an essential process of capital. The process of production cannot be recommenced until the commodity has been transformed into money. The uninterrupted continuity of that process, the unhindered and fluent transition of value from one form into the other, or from one phase of the process into the other, appears as a basic condition for production based on capital to a much greater degree than for all earlier forms of production.

On the other hand, while the necessity of this continuity is posited, the phases [of the process] fall asunder in time and space as particular processes indifferent to one another. Thus it appears to be a matter of chance for production based on capital, whether or not its essential condition, the continuity of the various processes which constitute the totality of its process, is fulfilled. The transcendence of this element of chance through capital itself is credit. (It has other aspects as well; but this one arises directly from the nature of the process of production and is therefore the basis of the necessity of credit.) That is why credit in any developed form does not appear in any earlier mode of production. There was borrowing and lending in earlier situations too; indeed, usury is the most ancient of the antediluvian forms of capital. But borrowing and lending no more constitute credit than working constitutes industrial labour or free wage labour. As an essential, developed relation of production, credit appears historically only in circulation based on capital or wage labour. (Money itself is a form to transcend the inequality of the time required in different branches of production in so far as this inequality obstructs [V-26] exchange.) Usury in its bourgeois form, adapted to capital, is itself a form of credit, but in its pre-bourgeois form it is rather an expression of the lack of credit.

(The reconversion of money into the objective moments or conditions of production presupposes their availability. It constitutes the various markets in which the producer encounters them as commodities — in the hands of the merchant — markets (alongside the LABOUR MARKET) which are essentially different from the markets for direct individual, final consumption.)

In its circulation, money was converted into a commodity, and in the exchange of M for C, consumption completed the process. Or the commodity was exchanged for money — and in the exchange of C for M, M was either a vanishing moment to be itself exchanged again for C, where the process again ended in consumption; or the money was withdrawn from circulation and became dead treasure, a merely symbolic wealth. At no point did the process ignite from a spark within itself, for the presuppositions of the circulation of money lay outside it and it constantly required new stimulus from without.

In so far as the two moments [C—M] exchanged for one another, the change in their form within circulation was merely formal. But in so far as content was involved in the change, it fell outside the economic process; the content did not belong within it. Neither did the commodity maintain itself as money nor the money as commodity; each was the one or the other. Value as such did not maintain itself in and through circulation as embracing its process of transformation, its change of form; nor was use value itself produced by exchange value (which is the case in the production process of capital).

With capital, the consumption of the commodity itself is not a final act; it falls within the production process and appears as itself a moment of production, i.e. of the process of positing value. Capital is now posited, but posited in each of the moments in which it appears now as money, now as commodity, now as exchange value, now as use value, posited as value which not only formally maintains itself throughout these changes in its form, but which valorises itself as well, i.e. it is posited as value relating to itself as value. The transition from one moment to the other appears as a particular process, but each of these processes is the transition into the other. In this way capital is posited as value-in-process, which is capital in every one of the moments. It is therefore posited as capital circulant; in each of the moments it is capital and circulating from one determination to the other. The point of return is simultaneously the point of departure and vice versa — i.e. the capitalist. All capital is originally capital circulant, both produced by and producing circulation, tracing its orbit as its own.

The circulation of money now, from the present standpoint, appears only as a moment of the circulation of capital, and its independence is posited as a mere semblance. It appears as determined on all sides by the circulation of capital, a point to which we shall return. In so far as it constitutes an independent movement alongside that of capital, this independence is only posited by the continuity of the circulation of capital, so that this one moment can be fixed and considered for itself.

/"'Capital permanent value multiplying itself, which no longer becomes extinct. This value detaches itself from the commodity which has produced it; equivalent to a metaphysical, insubstantial quality always in the possession of the same cultivator" (e.g.) "for whom it assumes various forms" (Sismondi, [Nouveaux principes d'économie politique, Vol. I, pp. 88-89,] VI).

"In the exchange of labour for capital, the worker demands subsistence pour vivre⁽⁸⁾; the capitalist demands du travail pour gagner*⁽⁹⁾" (Sismondi, I.e.

fP- 91])-

"The chef d'atelier^ gains, profits de tout l'accroissement des pouvoirs productifs qu'avait opéré la division du travail^" (I.e. [p. 92]). "The sale of labour=renunciation of all the fruits of labour" (Cherbuliez, [Richesse ou pauvreté, p. 64,] Ch. XXVIII^[142]).

"The three component parts of capital" (i.e. matière première, instrument, approvisionnement*) "do not grow in the same proportion, nor are they in the same relation at different stages of society. The approvisionnement remains the same for a definite time, however quickly the rapidité de la production and in consequence the quantity of products may grow. Hence the increase in productive capital does not necessarily entail an increase in the approvisionnement, which should determine the price of labour. It may actually be accompanied by its diminution" (I.e. [pp. 61-63])../

/*ln as much as the continuous renewal of production depends on the sale of the finished products, on the conversion, that is, of the commodity into money and the reconversion of money into the conditions of production — raw material, instrument, wages—; and in as much as the path capital must follow in passing from one of these determinations to the other constitutes sections of circulation, and these sections are traversed in certain periods of time; (note that even spatial distance resolves itself into time; e.g. in the case of the market, it is not its spatial distance which really matters, but the speed, the amount of time, in which it is reached) by the same token it depends on the speed of circulation, on the time taken by it, how many products can be produced in a given period of time, how often capital can valorise itself in a given period of time, how often it can reproduce and multiply its value in that time.

Thus there really does enter here a moment of value determination which [V-27] does not arise from the direct relation of labour to capital. It would seem that the relation in which the same capital can repeat the process of production (creation of new value) in a given period of time is a condition not directly posited by the production process itself. Though circulation does not give rise to a moment of value determination itself, for this lies exclusively in the sphere of labour, the speed of circulation does determine the rate at which the process of production can be repeated, and therefore the speed with which values are created. In other words, while not creating values, circulation does, to a certain degree, determine the mass of values which can be created. This will be the values and surplus values posited by the process of production X the number of times the production process can be repeated in a given period of time.

When we speak of the speed of the turnover of capital, we presume that only external barriers obstruct the transition from one phase [of circulation] to another, not ones arising from the production process and from circulation itself (as in crises, overproduction, etc.).

Thus, in addition to the labour time realised in the product, the circulation time of capital comes in as a moment of value creation — of productive labour time itself. If labour time appears as the activity which posits value, the circulation time of capital appears as the time of devaluation. This distinction appears as follows: if we assume that the totality of labour time commanded by capital is set at its maximum, say the infinite °°, in such a way that the necessary labour time would constitute an infinitely small part and the surplus labour time an infinitely large part of this °°, then this would be the greatest possible valorisation of capital, and that is what it strives for. On the other hand, if we assume that the circulation time of capital = 0, and that it traverses the various stages of its transformation as quickly in reality as it does in thought, then this would equally be the greatest possible factor by which the production process could be repeated, i.e. the greatest possible number of valorisation processes of capital which could take place in a given period of time.

The repetition of the production process would be restricted only by the duration of that process itself, the time required to transform the raw material into product. The circulation time is therefore not a positive value-creating element. If it were equal to 0, value creation would be at its highest level. If either surplus or necessary labour time^O, i.e. if necessary labour time absorbed all time, or if production could be carried on without any labour, there would be neither value nor capital, nor value creation. Hence the circulation time determines value only in so far as it appears as a natural barrier for the valorisation of labour time. Thus it is IN FACT a deduction from surplus labour time, i.e. an increase in necessary labour time. It is clear that necessary labour time must be paid for, whether the circulation process goes on slowly or quickly.

E.g. in industries in which specialised workers are required, who, however, can be employed for only a part of the year, perhaps because the product can only be sold during a particular SEASON, they would still have to be paid for the whole year, i.e. surplus labour time is diminished in proportion as they are underemployed during a given period of time, but still have to be paid d'une manière ou d'une autre. (E.g. by receiving in 4 months enough wages to subsist for a year.) If capital could employ them for 12 months, it would not pay them any more in wages, and would have gained that much [8 months'] surplus labour.

Circulation time therefore appears as a barrier to the productivity of labour=increase in necessary labour time=decrease in surplus labour time = decrease in surplus value=an obstruction, a barrier to the self-valorisation process of capital. Thus, while capital must strive on the one hand to tear down every local barrier to traffic, i.e. to exchange, and to conquer the whole world as its market, it strives on the other hand to annihilate space by means of time, i.e. to reduce to a minimum the time required for the movement [of products] from one place to another. The more capital has been developed, and the greater therefore the expansion of the market in which it circulates, which constitutes the spatial path of its circulation, the more it goes on to strive for an even greater spatial expansion of the market and for a more complete annihilation of space by means of time.

(If labour time is not considered as the working day of an individual worker but as the indefinite working day of an indefinite number of workers, all the relations of population come in here. The basic theories of population are therefore contained in this first chapter on capital, as are those of profit, price, credit, etc.)

The universalising tendency of capital becomes apparent here, which distinguishes it from all earlier stages of production. Although itself limited by its very nature, capital strives towards the universal development of the productive forces and thereby clears the way for a new mode of production, in which the productive forces are not developed just to reproduce a particular situation or, at most, to extend it, but where the free, unob-structed, progressive and universal development of the productive forces is itself the presupposition of society and therefore of its own reproduction; where the sole presupposition is the advance beyond the point of departure. This tendency possessed by capital, which simultaneously contradicts capital as a limited form of production and hence drives it towards its dissolution, distinguishes capital from all earlier modes of production and at the same time implies that it is posited as mere point of transition. All previous forms of society [V-28] were destroyed by the development of wealth — or, which is the same thing, by the development of the social productive forces. Among the ancients, who were conscious of this fact, wealth was therefore directly denounced as bringing about the dissolution of the community. Feudal society, for its part, was destroyed by urban industry, trade and modern agriculture. (Even by some inventions, e.g. gun powder and the printing press.)

With the development of wealth — and hence also of new [productive] forces and expanded intercourse among individuals— the economic conditions upon which the community was based were dissolved, as were the corresponding political relations between the various component parts of the community: the religion, in which it was viewed in idealised form (and both community and religion, in turn, were rooted in a given relationship to nature, into which all productive force resolves itself); the character, outlook, etc., of the individuals. The development of science alone, i.e. of the most solid form of wealth, both product and producer of wealth, was sufficient to dissolve this community. But the development of science, this notional and at the same time practical form of wealth, is only one aspect, one form, in which the development of human productive powers, i.e. of wealth, appears.

Considered notionally, the dissolution of a definite form of consciousness would be sufficient to destroy an entire epoch. In reality, this barrier to consciousness corresponds to a definite degree of development of the material productive forces and thus of wealth. True, development not only took place on the old basis, there was also a development of this basis itself. The highest development of this basis itself (the flower into which it is transformed, while remaining this basis, this plant as flower; hence withering after flowering and as a result of flowering) is the point at which it is itself worked out and developed to the form in which it becomes compatible with the highest degree of the development of the productive forces and thus also with the richest development of the individuals [possible on this basis]. As soon as this point has been reached, further development appears as a decline, and the new development begins from a new basis.

We have seen above^[3] that [the worker's] property in the conditions of production was posited as identical with a limited, specific form of community, a community consisting of individuals with just this kind of characteristics — limited characteristics and limited development of their productive powers. This presupposition was itself in turn the result of a restricted historical stage of development of the productive forces, of both wealth and the mode of producing it. The purpose of the community, of the individual — as well as the condition of production — was the reproduction of these specific conditions of production and of the individuals, both singly and in their social groups and relations— as the living carriers of these conditions.

Capital posits the production of wealth itself and thus the universal development of the productive forces, posits the continual overthrow of its existing presuppositions, as the presupposition of its reproduction. Value excludes no use value, i.e. includes no specific kind of consumption, etc., intercourse, etc., as absolute condition, and likewise every degree of the development of the social productive forces, of intercourse, of knowledge, etc., appears to it as a barrier which it strives to overcome. Its very presupposition — value — is posited as product, not as a higher presupposition hovering above production. The barrier to capital is the fact that this entire development proceeds in a contradictory way, and that the elaboration of the productive forces, of general wealth, etc., knowledge, etc., takes place in such a way that the working individual alienates himself; that he relates to the conditions brought out of him by his labour, not as to the conditions of his own, but of alien wealth, and of his own poverty. But this contradictory form is itself vanishing and produces the real conditions for its own transcendence.

The result is: the tendentially and 8"uva|X£i⁽¹⁰⁾ universal development of the productive forces — of wealth in general — as basis, likewise the universality of intercourse, hence also the world market as basis. The basis as the possibility of the universal development of the individuals, and their actual development from this basis as constant transcendence of their barrier, which is recognised as such, and is not interpreted as a sacred limit. The universality of the individual not as an imaginary concept, but the universality of his real and notional relations. Hence also the comprehension of his own history as a process and the knowledge of nature (likewise available as practical control over nature) as his real body. The process of development itself posited and known as the presupposition of the same. For this, however, necessary above all that the full development of the productive forces has become the condition of production; and not that particular conditions of production are posited as the limit to the development of the productive forces.

Let us now return to the circulation time of capital. Its reduction (in so far as this is not due to the development of the means of communication and transport which are necessary to bring the product to the market) is in part creation of a continuous market and hence of an ever expanding market; and in part development of economic relations, developments of forms of capital [V-29] by means of which circulation time is artificially reduced. (All forms of credit.)

^ A t this point, it may be further noted that, since only capital has the conditions of the production of capital, hence satisfies and strives to realise them, it is the general tendency of capital at all points which are presuppositions of circulation and function as the latter's productive centres, to assimilate these points to itself, i.e. to transform them into capitalising production or production of capital. This propagandistic (civilising) tendency is unique to capital — it distinguishes it from all earlier conditions of production.^"

The modes of production in which circulation is not an immanent, dominating condition of production, naturally [do] not [have] the specific circulation needs of capital, nor, consequently, do they evolve either the economic forms or the real productive forces corresponding to them.

Production based on capital initially set out from circulation. We now see how it posits circulation as its own condition and how it likewise posits the production process in its immediacy as a moment of the process of circulation and equally posits that process as a phase of the production process in its totality.

In so far as different capitals circulate in different lengths of time (e.g. one [produces for] a more distant market, the other for one near at hand; the conversion of one capital into money is secure, that of the other hazardous; one [contains] more capital fixe, the other more capital circulant), this brings about differences among them in valorisation. But this only occurs in the secondary valorisation process. Circulation time in itself is a barrier to valorisation. (Necessary labour time is, admittedly, another barrier; but it is simultaneously an essential element, for without it there would be no value or capital.) It is a deduction from surplus labour time or an increase of the necessary labour time in relation to surplus labour time. The circulation of capital realises value, as living labour produces value. Circulation time is a barrier only to the realisation of value and to that extent to value creation. It is a barrier which does not arise from production in general but which is specific to production based on capital. Its transcendence — or the struggle against it — therefore belongs to the specific economic development of capital and provides the impulse for the development of its forms in credit, etc.^

^Capital itself is subject to the contradiction that while it constantly tries to transcend necessary labour time (which implies the reduction of the worker's role to a minimum, i.e. his existence as mere living labour capacity), surplus labour time exists only in a contradictory way, only in antithesis to necessary labour time. Consequently, capital posits necessary labour time as a necessary condition for its own reproduction and valorisation. A development of the material productive forces, which is at the same time the development of the forces of the working class, at a certain point transcends capital itself.^

/ " ' The entrepreneur can only recommence production after he has sold the finished product and has used the price in purchasing new matières and new salaires. Hence, the more promptly circulation brings about these two effects, the more quickly is he in a position to recommence his production, and the greater the quantity of products capital produces in a given period of time" (Storch, [Cours d'économie politique, Vol. I, pp. 411-12,] 3 4 ) . /

, , / " T H E SPECIFIC ADVANCES OF THE CAPITALIST DO NOT CONSIST OF CLOTH, ETC., BUT OF LABOUR" (Malthus, [The Measure of Value Stated and Illustrated, p. 17,] IX, 26). ^{[1 4]}V

/ " T H E ACCUMULATION OF THE GENERAL CAPITAL OF THE COMMUNITY IN OTHER HANDS [ t h a n ] THOSE OF THE OPERATIVE LABOURERS, NECESSARILY RETARDS THE PROGRESS OF ALL INDUSTRY SAVE THAT OF THE USUAL REMUNERATION OF CAPITAL, WHICH THE TIME AND CIRCUMSTANCES AFFORD TO THE HOLDERS OF THE CAPITAL... I n the previous systems, productive force considered IN REFERENCE TO and SUBORDINATE TO ACTUAL ACCUMULATIONS, AND TO THE PERPETUATING OF THE EXISTING MODES OF DISTRIBUTION. ACTUAL ACCUMULATION AND DISTRIBUTION ARE SUBORDINATE TO THE POWER OF PRODUCING" (Thompson, [An Inquiry into the Principles of the Distribution of Wealth..., London, 1824, pp. 176, 589,] 3 ) . ⁽¹¹⁾ / It follows from the relationship of circulation time to the production process that the sum of values which is produced, or the total valorisation of capital in a given period of time, is determined not only by the new value which capital creates in the production process, or by the surplus time realised in that process, but also by this surplus time (surplus value) multiplied by the factor which expresses the frequency with which the production process of capital can be repeated in that period. The factor expressing this repetition can be regarded as the coefficient of the production process or of the surplus value created by it.

However, this coefficient is not positively but negatively determined by the speed of circulation. I.e. if the speed of circulation were absolute, that is to say, if the production process were not interrupted at all by circulation, this coefficient would be at its greatest. E.g. if the real conditions of wheat production in a given country allowed only one harvest a year, no speed of circulation could make that country's soil yield two harvests a year. But if circulation were obstructed, if the farmer could not sell his wheat quickly enough e.g. to hire workers again, production would be stopped. The maximum of the coefficient of the production process or process of valorisation in a given period of time is determined by the absolute time taken by the [V-30] production phase itself. Once circulation has been completed, capital can recommence its production process. If, therefore, circulation caused no delay at all, its speed would be absolute and its duration would be 0, i.e. if it were accomplished IN NO TIME, that would merely be the same as if capital had been able to recommence its production process just as soon as it had been completed. I.e. circulation would not have existed as a limiting barrier on production, and the repetition of the production process in a definite period of time would be absolutely dependent upon, would coincide with, the duration of the production process.

Hence, if the development of industry permitted a capital of £100 to produce x lbs of twist in 4 months, the production process could only be repeated 3 times a year with the same capital; only Sx lbs of twist could be produced. No speed of circulation could accelerate the reproduction of capital or rather the repetition of its valorisation process beyond this point. It could only come about in consequence of an increase of the productive forces. Circulation time itself is not a productive force of capital but a barrier to its productive force, arising from its nature as exchange value. The passage [of capital] through the various phases of circulation here appears as a barrier to production, a barrier posited by the specific nature of capital itself. An acceleration and reduction of circulation time—of the process of circulation — can only reduce the barrier posited by the nature of capital. The natural barriers to the repetition of the production process e.g. in agriculture, coincide with the duration of one cycle of the production phase. The barrier posited by capital is not the time which elapses between sowing and harvesting, but between harvesting and the conversion of the harvest into money and the reconversion of the money into e.g. the purchase of labour. The circulation manipulators who imagine that by accelerating circulation they can do anything other than reduce the obstacles to the reproduction of capital posited by capital itself, are on the wrong track.

(Even crazier, of course, are the circulation manipulators who imagine that credit banks and new credit devices which transcend the duration of circulation time can not only remove the delays, the interruption of production, required for the conversion of the finished product into capital, but make the capital for which the producing capital exchanges, itself superfluous, i.e. they want to continue to produce on the basis of exchange value, but at the same time to remove by some magical formula the conditions necessary for production on this basis.)

The most that credit can do in this respect, where it is a matter of mere circulation, is to maintain the continuity of the production process if all other conditions for this continuity are present, i.e. if the capital to be exchanged with actually exists, etc.

It is posited in the process of circulation that the conversion of capital into money, or the exchange of capital for capital as a barrier to the exchange of capital for labour and vice versa is posited as the condition for the valorisation of capital by production, for the exploitation of labour by capital ^ f o r from the present standpoint, we only have labour or capital at all points of circulation^.

Capital exists as capital only in so far as it passes through the phases of circulation, the different moments of its transformation, to be able to recommence the production process. These phases are themselves phases of its valorisation — but at the same time, as we have seen,⁽¹²⁾ phases of its devaluation. As long as capital remains fixed in the form of finished product, it cannot be active as capital; it is negated capital. Its process of valorisation is held up in the same degree and its value-in-process negated. This appears as a loss for capital, a relative loss of its value, for its value consists precisely in the process of valorisation. In other words, this loss [of value] of capital only means that time passes for it unutilised, time in which it could appropriate surplus labour time, alien labour, by exchange with living labour, if the DEADLOCK had not occurred.

Let us suppose a large number of capitals employed in particular branches of industry, which are all necessary (in the sense that if there were a massive flight of capital from one branch, the supply of products in this branch would fall below the demand, hence market price would rise above the natural price). Let us suppose further that it was necessary for capital a in one branch to remain longer in its devalued form, i.e. that the time it takes the capital to pass through the various phases of circulation is longer than in all other branches. This capital a would then consider the lesser new value it could produce to be a positive loss, just as if it had to invest so much more to produce the same value. Hence it would charge a proportionately higher exchange value for its products than the other capitals, in order to share in the same rate of profit. But IN FACT this could only happen if the loss were distributed among the other capitals. If a demands more exchange value for the product than is objectified in it as labour, [V-31] it can obtain this "more" only if the other capitals obtain less than the real value of their products. I.e. all the capitalists who exchanged with a would bear a fractional part of [the cost of] the less favourable conditions under which a had produced. In this way, an equal average profit would result. Yet the sum of surplus values produced by all the capitals taken together would be diminished precisely in proportion to the lesser valorisation of capital a relative to the other capitals. Only this diminution, instead of falling exclusively upon capital a, would be borne as a general loss shared proportionately by all the capitals.

Nothing could therefore be more ludicrous than to imagine (see e.g. Ramsay⁽¹³⁾) that capital can constitute an original source of value creation apart from labour, from its exploitation. For the distribution oi surplus labour among the individual capitals takes place not in proportion to the surplus labour time achieved by the individual capital, but in proportion to the total surplus labour achieved by the totality of capitals. The individual capital can therefore be credited with more value creation than is directly explicable by its particular exploitation of labour power. But this "more" on the one side must be compensated for by a "less"on the other. Otherwise, average means nothing at all. The question how the relation of capital to alien capital, i.e. the competition of capitals, distributes surplus value among them, obviously has nothing to do with the absolute amount of this surplus value. Nothing therefore more absurd than to conclude that, because a particular capital is compensated for its exceptional circulation time, i.e. calculates its relatively lesser valorisation as a positively higher valorisation, all the capitals taken together, capital, can make something out of nothing, turn a minus into a plus, minus-surplus labour time or minus-surplus value into plus-surplus value; to conclude, in other words, that it has a mystical source of value creation independent of the appropriation of alien labour.

The method of calculating the capitals' respective shares in surplus value—not only on the basis of the surplus labour time which they have achieved, but also in accordance with the length of time during which their capital has been working as such, i.e. has lain fallow, gone through the phase of devaluation — does not of course in the least affect the total amount of surplus value which they have to distribute among themselves.

This amount cannot be increased by the fact that it is smaller than it would have been if capital a had produced surplus value instead of lying fallow, in other words, by the fact that it has produced less surplus value in the same time than the other capitals. Capital a is compensated for this lying-fallow only in so far as it arises necessarily from the conditions of the particular branch of production, and so appears in relation to capital in general as an impediment to its valorisation, a necessary barriei to its valorisation generally. The division of labour allows us to regard this barrier only as a barrier to the production process of this particular capital. But if we regard the production process as carried on by capital in general, it constitutes a general barrier to its valorisation. If we regard only labour itself as productive, all larger advances which it requires during its valorisation appear as what they are—deductions from surplus value.

Circulation can create value only in so far as it requires additional employment—of alien labour—additional to that directly consumed in the production process. This is then the same as if more necessary labour were directly required in the production process. Only the real costs of circulation increase the value of the product, but they reduce surplus value.

In so far as the circulation of capital (the product, etc.) does not express merely the necessary phases [which capital must pass through] to recommence the production process, this circulation (see Storch's example⁽¹⁴⁾) does not constitute a moment of production in its totality — is not therefore circulation posited by production; and in so far as it involves costs, these are faux frais de production}" In so far as circulation costs in general, i.e. the production costs of circulation, concern the exclusively economic moments, circulation in the strict sense (bringing the product to the market gives it new use value), they have to be regarded as deductions from surplus value, i.e. as an increase of necessary labour relative to surplus labour.

The continuity of production presupposes that circulation time has been transcended. If it is not, time must elapse between the various metamorphoses through which capital must pass; its circulation time must appear as a deduction from its production time. On the other hand, the nature of capital presupposes that it passes through the various phases of circulation, not indeed as in the imagination, where one concept can turn into another with the speed of thought, IN NO TIME, but rather as real situations which are separated from one another in time. It must spend some time as a chrysalis before it can take wing as a butterfly. The conditions of production arising from the nature of capital itself are therefore mutually contradictory. The contradiction can be transcended and overcome^except if one were to imagine that all capitals work to order for each other, and the product is therefore always immediately money, a notion which contradicts the nature of capital and hence also the practice of large-scale industry^ [V-32] only in two ways:

Firstly, credit: A pseudo-purchaser B—i.e. one who really pays but does not really buy — mediates the transformation of capitalist A's product into money. But B himself is only paid when capitalist C has purchased A's product. It is immaterial whether this CREDIT-MAN B gives money to A to buy labour, or the raw material and instrument of labour, before A can replace them from the proceeds of the sale of his product. Au fond, given our premisses, B must give him both — i.e. all the conditions of production (these, however, represent a greater value than that with which A embarked on the production process). In this case, capital b replaces capital a; but both are not valorised simultaneously. B now takes the place of A, i.e. his capital lies fallow until it is exchanged with capital c. It is fixed in the product of A, who has made his product liquid in capital b.

[ Theories of Surplus Value and Profit]

The absolute confusion of the economists with respect to the Ricardian determination of value by labour time — a confusion which is rooted in a fundamental defect of his own analysis — is very clearly apparent in Mr. Ramsay's work. He says, after earlier discussing the influence of the circulation time of capitals on their relative valorisation, i.e. on their relative share in total surplus value, and coming to the absurd conclusion that:

"This shows HOW CAPITAL MAY REGULATE VALUE INDEPENDENTLY OF LABOUR" (IX, 84. R[amsay, G., An Essay on the Distribution of Wealth,] 43),

or that

"CAPITAL [is] A SOURCE OF VALUE INDEPENDENT OF LABOUR" (I.e., p . 5 5 ) ;

literally:

"A CIRCULATING CAPITAL (approvisionnement) WILL ALWAYS MAINTAIN MORE LABOUR THAN THAT FORMERLY BESTOWED UPON ITSELF. BECAUSE, COULD IT EMPLOY NO MORE THAN HAD BEEN PREVIOUSLY BESTOWED UPON ITSELF, WHICH ADVANTAGE COULD ARISE T O THE OWNER FROM THE USE OF IT AS SUCH?" (I.e., p . 4 9 ) . "Given two capitals of equal value, EACH PRODUCED by the labour of 100 MEN OPERATING FOR A GIVEN TIME, of which the one is entirely circulating, the other entirely FIXED, AND MAY PERHAPS CONSIST OF WINE KEPT TO IMPROVE. NOW, this circulating capital, RAISED BY THE LABOUR OF 100 MEN, will set into motion 150 MEN. THEREFORE THE PRODUCT AT THE END OF THE COMING YEAR will in this case be the RESULT of the labour of 150 MEN. BUT STILL IT WILL BE OF NO MORE VALUE THAN THE WINE AT THE TERMINATION OF THE SAME PERIOD, although only 100 MEN [have been ] EMPLOYED UPON THE LATTER" (50). "Or does one wish to persuade us that the QUANTITY OF LABOUR WHICH EVERY CIRCULATING CAPITAL WILL EMPLOY IS NO MORE THAN EQUAL TO [the labour] PREVIOUSLY BESTOWED UPON IT? That would mean THAT THE VALUE OF THE CAPITAL EXPENDED is equal to that of the product" (52).

There is great confusion here between the LABOUR BESTOWED UPON capital and that WHICH IT WILL EMPLOY. The capital which is exchanged for labour capacity, the approvisionnement—and this is what he calls capital circulant—can never EMPLOY more labour THAN HAS BEEN BESTOWED UPON IT. (We are not concerned here with the way in which the development of the productive forces reacts back upon existing capital.) But THERE HAS BEEN MORE LABOUR BESTOWED UPON IT THAN IT Mr. Ramsay appears to imagine that if capital is the product of 20 working days (necessary and surplus time together), this product of 20 working days can employ 30 working days. But this is by no means the case. Say that 10 days of necessary labour and 10 days of surplus labour have been bestowed on the product. Surplus value then = 1 0 days' surplus labour. By re-exchanging this for raw material, instrument and labour, the capitalist can set new necessary labour in motion again with the surplus product. T h e point is not that he would have EMPLOYED more labour time than already existed in the product, but that he re-exchanges the surplus labour time, which costs him nothing, for necessary labour time, in other words, precisely that he EMPLOYS the whole of the labour time BESTOWED UPON THE PRODUCE, WHILE HE HAS PAID [for] ONLY PART OF THAT LABOUR. Mr. Ramsay's conclusion is THAT if THE QUANTITY OF LABOUR WHICH

EVERY CIRCULATING CAPITAL WILL EMPLOY WAS NO MORE THAN EQUAL TO THAT

PREVIOUSLY BESTOWED UPON IT, THE VALUE OF THE CAPITAL EXPENDED WOULD BE EQUAL

TO THAT OF THE PRODUCE, I.E. NO SURPLUS VALUE WOULD BE LEFT. T h i s W O U l d O n l y be correct, if the QUANTITY OF LABOUR BESTOWED UPON THE CAPITAL had been fully paid for, i.e. if capital had not appropriated a part of labour without equivalent. These misunderstandings of Ricardo['s theory ] obviously derive from the fact that Ricardo himself was not clear about the nature of the process [of capitalist production], nor, as a bourgeois, could he be. Insight into this process is=to the STATEMENT that capital is not merely, as A. Smith thinks, command over alien labour, in the sense in which every exchange value is that, because it provides its owner with buying power, but that it is the power of appropriating alien labour without exchange, without equivalent, but under the guise of exchange. Ricardo knows no other argument t o refute A. Smith and others who fall into the same error about value AS DETERMINED BY LABOUR and value AS DETERMINED

BY THE PRICE OF LABOUR (WAGES), except to say that with the product of the same quantity of labour one can sometimes set a greater quantity and sometimes a lesser quantity of living labour in motion, i.e. he regards the product of labour with respect to the worker only as use value, the part of the product which the worker requires to live as a worker. But it is BY NO MEANS clear to him how it comes about that the worker suddenly represents only use value in exchange, or that he extracts only use value from the exchange, as is already proved by his [V-33] argument against A. Smith, which is never general, but always relies on the illustration of individual examples.

How, then, does it come about that the share of the worker in the value of the product is not determined by its value but by its use value, hence not by the labour time bestowed upon it but by its quality of maintaining living labour capacity? If he tries to explain this by, say, competition among the workers, the answer would be the same as the one he himself gives to A. Smith in relation to competition among capitalists — that this competition can certainly even up and equalise the level of profit, but can in no way establish the measure of this level.⁽¹⁾ In the same way, competition among the workers could bring down the higher wage levels, etc., but the general standard of wages or, as Ricardo calls it, the natural price of the wages of labour, could not be explained by competition between worker and worker but only by the original relation between capital and labour. Competition in general, this essential locomotive force of the bourgeois economy, does not establish its laws but is their executor. Hence UNLIMITED COMPETITION is not the presupposition for the validity of the economic laws but the consequence — the form of appearance in which their necessity is realised. For the economists to presuppose, as Ricardo does, that UNLIMITED COMPETITION exists,⁽²⁾ is to presuppose the full reality and realisation of the bourgeois relations of production in their differentia specifica. Competition therefore does not explain these laws, nor does it produce them; it lets them become manifest.

Ricardo also says⁽³⁾ the costs of production of living labour depend on the cost of producing the values necessary to reproduce it. If previously he regarded the product with respect to the worker merely as use value, he now regards the worker with respect to the product merely as exchange value. He does not concern himself at all with the historical process by means of which the product and living labour enter into this relation to one another. But he is just as unclear about the way in which this relation is perpetuated. In his view, capital is the result of saving, which already indicates that he misunderstands its origin and process of reproduction. He therefore also believes that production cannot be carried on without capital, while he believes that capital may very well exist without ground rent. The difference between profit and surplus value does not exist for him; proof that he is not clear about the nature of either. His procedure right from the start already shows this. Initially, he lets workers exchange with workers — and their exchange is then determined by the equivalent, by the labour time reciprocally expended in production. Then the basic problem of his political economy emerges: he must prove that this determination of value is not changed by the accumulation of capitals — i.e. by the existence of capital.

Firstly, it does not occur to him that his first spontaneously evolved relation is only a relation which has been abstracted from production based on capital. Secondly, he assumes the [prior] existence of a particular amount of objectified labour time, which may of course increase, and then asks himself how it is distributed. But the question is RATHER how it is created, and it is precisely the specific nature of the relation of capital and labour, or the differentia specifica of capital, which explains this. In fact, as De Quincey puts it ([The Logic of Political Economy, Edinburgh, London, 1844, p. 204] X, 5), modern (Ricardian) political economy is only concerned with the dividends, while the total product is regarded as fixed, determined by the quantity of labour bestowed upon it — its value is estimated in accordance with that. Ricardo is therefore justifiably reproached for a lack of understanding of [the nature of] SURPLUS VALUE, although his opponents understand it even less.⁽⁴⁾ Capital is represented as appropriating a certain part of the available value of labour (of the product); the creation of this value, which it appropriates over and above [that of] the reproduced capital, is not represented as the source of surplus value. The creation of this [surplus value] coincides with the appropriation of alien labour without exchange, and it must therefore never be clearly understood by the bourgeois economists.

Ramsay reproaches Ricardo for forgetting that capital fixe (which together with approvisionnement constitutes capital; in Ramsay's view, [circulating capital is composed of] both RAW MATERIAL and INSTRUMENT) is deducted from the sum which the capitalist and the worker have to share out among themselves.

"Ricardo overlooks the fact that the whole product is not only divided up between WAGES and PROFITS, but that a part of it is also NECESSARY FOR REPLACING FIXED CAPITAL" (IX, p. 88. R[amsay, G., op. cit.,] 174, note).

In fact, since Ricardo does not conceive the relation between objectified and living labour — which cannot be deduced from the dividends of a given amount of labour, but presupposes the positing of surplus labour — in its living movement, and does not therefore grasp the relation of the different components of capital to one another, he appears to be arguing that the total product is divided into WAGES and PROFITS, SO that the reproduction of capital itself is counted as part of profit.

Quincey (I.e., Notebook X, 5) analyses the Ricardian theory as follows:

"If the price is 10 shillings, then WAGES and PROFITS AS A WHOLE CANNOT EXCEED ] 0 SHILLINGS. BUT DO NOT THE WAGES AND PROFITS AS A WHOLE, THEMSELVES, ON THE CONTRARY, PREDETERMINE THE PRICE? NO, THAT IS THE OLD SUPERANNUATED DOCTRINE" (p. 204). "The new political economy has shown THAT ALL PRICE IS GOVERNED BY

PROPORTIONAL QUANTITY OF THE PRODUCING LABOUR, AND BY THAT ONLY. BEING ITSELF ONCE SETTLED, THEN, IpSO facto,* PRICE SETTLES THE FUND OUT OF WHICH BOTH WAGES

AND PROFITS MUST DERIVE THEIR SEPARATE DIVIDENDS'1"1 (I.e., p . 2 0 4 ) .

Capital appears here not as the positing of surplus value, i.e. surplus labour, but merely as making deductions from a given amount of labour. The fact that the instrument and raw material appropriate these dividends to themselves must then be explained by their use value in production. But this then assumes the absurdity that raw material and instrument produce use value through their separation from labour. For it is this separation which converts them into capital. Considered for themselves they are themselves labour, previous labour. Moreover, this is an affront to COMMONSENSE, since the capitalist knows very well that he counts wages and profit as part of the production costs and regulates the necessary price accordingly. This contradiction between the determination of [the value of] the product by relative labour time, and the limitation of the sum of profit and WAGES by the sum of this labour time, and the real determination of price in practice, derives simply from the failure to conceive of profit itself as a derivative, secondary form of surplus value; and the same applies to what the capitalist correctly regards as his production costs. His profit arises simply from the fact that a part of the production costs does not cost him anything, and so does not enter into his outlays, his production costs.

But this is true only in so far as ANY VARIATIONS IN THE MASS OF SURPLUS

LABOUR MUST BE DERIVED FROM A VARIATION IN THE RELATION BETWEEN NECESSARY AND SURPLUS LABOUR. But such a variation may occur either because there has been a decline in the productivity of NECESSARY LABOUR, so that a larger part of the total labour falls to it; or because there has been an increase in the productivity of total labour, so that necessary labour time is reduced. It is NONSENSE to assert that this productive power of labour originates from WAGES. On the contrary, the diminution of relative WAGES is its result. But it arises (1) from the appropriation by capital of the growth of the productive forces resulting from the division of labour, trade, which cheapens the raw materials, science, etc., (2) but this increase in the productive forces must be regarded as initiated by capital, in so far as it is realised by the employment of a greater capital, etc. Furthermore, PROFIT and WAGES, though determined by the relation of necessary to surplus labour, are not coincident with them, but merely secondary forms of the same.

The point, however, is: the Ricardians presuppose a certain amount of labour, which determines the price of the product. From this price labour now draws its dividend in WAGES and capital in PROFITS. The dividend of the worker=the price of the necessary means of subsistence. In the "EXISTING RELATIONS BETWEEN WAGES and PROFITS- the rate of profit is at its maximum and that of wages at its minimum. Competition between capitalists can alter only their proportionate shares in total profit, not the relation between total profit and total WAGES. The GENERAL STANDARD OF PROFIT is this relation of total profit to total WAGES, and this is not altered by competition. Where, then, does ALTERATION come from? Certainly not by a voluntary reduction in the rate of profit; and it would have to be voluntary, since competition does not have this result. So it must be by an ALTERATION in WAGES: their necessary costs may rise (cf. the theory of the progressive deterioration of the soil through agriculture; the theory of rent) because of a decline in the productive power of labour due to natural causes. To this, Carey, etc., rightly objects (although he bases his objection on an incorrect analysis) that the rate of profit falls, not because of the decrease, but because of the increase in productive power.^[3]

The solution of the whole problem is simply that the rate of profit does not orientate itself by absolute surplus value, but by surplus value in relation to the capital employed; and that the growth of productive power is accompanied by a reduction in the part of capital representing approvisionnement relative to the part representing invariable capital. Hence, when the ratio of total labour to the capital which employs it declines, then the part of labour which appears as surplus labour or surplus value necessarily declines [relatively], too. This inability to explain one of the most striking phenomena of modern production, is the source of Ricardo's failure to understand his own principle. The difficulties in which he thereby involves his disciples are illustrated by this quotation, among others, from Quincey:

" I T IS THE COMMON PARALOGISM, THAT IF UPON THE SAME FARM YOU HAVE ALWAYS KEPT ^[5] MEN, AND IN 1 8 0 0 THEIR PRODUCE WAS ^{[2 5]} QRS., BUT IN 1 8 4 0 5 0 QRS., YOU ARE APT

TO VIEW THE PRODUCE ONLY AS VARIABLE, AND THE LABOUR AS CONSTANT; WHEREAS VIRTUALLY BOTH HAVE VARIED. IN 1 8 0 0 EACH QR. MUST HAVE COST V5 PART OF A MAN; IN 1840 EACH HAS COST NO MORE THAN Vio PART OF A MAN" (l.C, p. 214).

In both cases, absolute labour time was the same, 5 days; but in 1840 the productivity of labour was twice that of 1800, and the COST OF PRODUCING NECESSARY LABOUR had consequently fallen. The labour BESTOWED UPON 1 QUARTER was less, but total labour was the same. But Mr. Quincey should know from Ricardo that it is not the productivity of labour which determines the value of the product — it does determine surplus value, though not in the proportion in which productivity has increased. These contradictions [speak] against Ricardo, as [do] the desperate sophistries of his disciples (e.g. Mr. MacCulloch,^[144] who explains by surplus labour the surplus value of old wine compared to new^[3]). Nor is value determined by the labour which the UNIT has cost, i.e. the price of the SINGLE QUARTER. The price multiplied by the quantity is what constitutes value. The 50 quarters in 1840 had the same value as the 25 in 1800, because they objectified the same amount of labour. The price for one single quarter, the UNIT, must have been different [in 1800 from what it was in 1840], and total price (expressed in money) may have been different [in the two years] for very different reasons.

(What Quincey says about the machine is equally true of the worker:

De Quincey says of Malthus:

"MALTHUS IN HIS POLITICAL ECONOMY REFUSES TO SEE, NAY HE POSITIVELY DENIES, THAT IF 2 MEN PRODUCE A VARIABLE RESULT OF 1 0 AND 5, THEN IN ONE CASE EACH UNIT OF THE RESULT HAS COST DOUBLE THE LABOUR WHICH IT HAS COST IN THE OTHER. O N THE CONTRARY, BECAUSE THERE ARE ALWAYS ^[2] MEN, MR. MALTHUS OBSTINATELY INSISTS THAT THE COST IN LABOUR IS CONSTANT" (I.e., p. 215, note).

IN FACT, THE COST IN LABOUR is CONSTANT, because, by presupposition, just as much labour is contained in 10 as in 5. But the COST OF LABOUR is not CONSTANT, because in the first case, since the productivity of labour has doubled, the time attributable to necessary labour is in a certain proportion reduced.

We shall examine Malthus' views immediately after this. Now, and before we discuss further the circulation time of capital and its relation to labour time, is the best time to consider the whole doctrine of Ricardo on this matter, in order to bring into sharper relief the difference between our own conception and his. (The quotations from Ricardo in Notebook VIII.)

His first premiss is "competition without limitation" and the unlimited possibility of increasing products through industry (19. R[icardo, D., On the Principles of Political Economy, and Taxation,] 3). In other words, this means nothing other than that the laws of capital are completely realised only within UNLIMITED COMPETITION and INDUSTRIAL PRODUCTION. Capital develops adequately [only] on the latter productive basis and the former relation of production. [Only] on this basis and in this relation [do] the immanent laws of capital become complete reality. As this is so, it would be necessary to show how UNLIMITED COMPETITION and INDUSTRIAL PRODUCTION are conditions for the realisation of capital, which it must itself produce to an ever increasing degree. (Instead, the hypothesis here appears as that of the mere theoretician, who places FREE COMPETITION and the productive mode of existence of capital externally and arbitrarily into the relation of capital to itself as capital, positing them not as themselves developments of capital, but as imaginary presuppositions of capital for the sake of its pure form.) This is, incidentally, the only place in Ricardo where he shows any inkling of the historical nature of bourgeois economic laws.

On this assumption, the relative value of commodities ("relative" is meaningless here, since [the concept of] absolute value is NONSENSE) is determined by the different quantities which can be produced in the same labour time, or in proportion to the quantities of labour realised in the commodities. (P. 4.) (Notebook, 19.) (Henceforth the first figure for the page in the notebook [VIII], the 2nd for the page in Ricardo.)

Ricardo is not at all interested in how we get from value as equivalent, determined by labour, to the non-equivalent, or to the value which posits surplus value in exchange, i.e. from value to capital, from one determination to the apparently antithetical one. The question for him is only: how the value relation between the commodities can remain the same, and how it can and must be determined by the relative amount of labour, despite the fact that the owners of accumulated labour and those of living labour do not exchange equivalents in labour, i.e. despite the relation of capital and labour. It is then a very simple mathematical example to show that commodity a and commodity b may exchange in proportion to the labour realised in them, although the producers of a or b share out product a or product b, for which it is exchanged, differently. But since all division here takes place on the basis of exchange, it seems in fact utterly inexplicable why one exchange value — living labour — exchanges according to the labour time realised in it, [VI-2] while the other exchange value — accumulated labour, capital — does not exchange according to the same standard. In this case, the owner of the accumulated labour could not be exchanging as a capitalist. Bray e.g. therefore believes that only with his concept of EQUAL EXCHANGE between living and dead labour has he taken Ricardo's analysis to its proper conclusion.⁽⁵⁾ That from the standpoint of simple EXCHANGE, the wages of the worker would have to be equal to the value of the product, i.e. that the quantity of labour in objective form received by the worker in wages would have to be equal to the quantity of labour in subjective form which he expends in labour, is so necessary a conclusion that A. Smith actually draws it.⁽⁶⁾

Ricardo, by contrast, avoids this fallacy, but how?

"The value of labour, and the quantity of commodities which a definite quantity of labour can buy, are not identical."

WHY NOT?

"Because the product of the worker or an equivalent for this product is not=to the remuneration of the worker."

This is to say that the identity does not exist, because the difference exists.

"Therefore" (because the identity does not exist) "it is not the value of labour which is the measure of value, but the labour bestowed upon the quantity of commodities" (19, 5).

The value of labour is not identical with the remuneration of labour. For they are different. Therefore they are not identical. This is an odd conclusion. Au fond, the only ground for this assertion is that the identity is not observed in practice. But according to [his] theory, it ought to exist. For the exchange of values is determined by the labour time realised in them. Hence equivalents are exchanged. Hence a particular amount of labour time in living form would have to exchange for the same amount of labour time in the form of past labour. What would have to be proved is precisely that the law of exchange turns into its opposite. Not even the faintest suspicion is expressed here that it does so, unless this is expressed in the frequently repeated warning against the confusion [of the amount of labour with the remuneration for that labour]. That the distinction between past and living labour cannot do the job, is readily admitted:

"The comparative quantity of commodities which a given amount of labour can produce determines their past and present value" (19, 9),

Where living labour thus even retrospectively determines the value of past labour. Thus, why is not capital also exchanged for living labour in relation to the labour realised in the capital? Why is it only an amount of living labour which is not itself=to the amount of labour in which it has objectified itself?

"Labour naturally varies in quality, and it is difficult to compare different working hours in different industries. But a scale of comparison is very quickly established in practice" (19, 13). "For short periods of time, at least from one year to another, variations in this inequality are insignificant, and are therefore left out of account" (19, 15).

This is nothing. If Ricardo had applied his own principle, the amounts of (simple) labour to which different labour capacities are reducible, the matter would have been simple. Generally, he is concerned straight away with the hours of labour. What the capitalist obtains through exchange is labour capacity; this is the exchange value for which he pays. Living labour is the use value which this exchange value has for him, and from this use value arises surplus value and the transcendence of exchange altogether.

By letting [the capitalist] exchange with living labour, and thus plunging straight into the process of production, Ricardo is left with an insoluble antinomy in his system, that a certain amount of living labour is not=to the commodity which it produces, in which it objectifies itself, even though the value of the commodity =the amount of labour contained in it.

"The labour necessary to bring the commodities to market is also included" in their value (19, 18).

We shall see that circulation time, in so far as it appears as determining value with Ricardo, is only the labour necessary to bring the commodities to market.

"The principle that the relative amounts of labour contained by commodities determine their value, becomes significantly modified by the application of machinery and other fixed and durable capital. A rise or fall in the wages of labour will affect differently 2 capitals, one of which is almost entirely circulating and the other almost entirely fixed; similarly the different duration of the fixed capital employed. For the profit on the fixed capital (interest) has to be added and also the compensation for the longer period of time which must elapse before the more valuable of the two commodities can be brought to market" (19; 25, 27, 29, 30).

This latter moment concerns only the duration of the process of production, i.e. the labour time directly employed, at least in Ricardo's example of the farmer and the baker [ibid., pp. 26, 27]. (If the former's wheat takes longer to become ready for the market than the latter's bread, then this so-called compensation already presupposes interest, as in the case of capital fixe; thus already something derivative, not an original determination.)

"Profit and wages are only the respective shares of the two classes of capitalists and workers in the original commodity, hence also in the commodity exchanged for it" (pp. 21, L19-]20).

How much the production of the original commodity, its origin itself, is determined by these shares, how it therefore precedes these shares as the basis of determination, is shown by the fact that the original commodity would not be produced at all, if it did not contain surplus labour for the capitalist.

"Commodities upon which the same quantity of labour has been bestowed differ in relative value, if they cannot be brought to market in the same time... Also, in the case of a greater fixed capital, the higher value of a commodity is due to the greater length of time which must elapse before it can be brought to market... The difference in both cases arises from profits being accumulated as capital, and is only a compensation for the time that the profits were held back" (20, 34, 30-31, 35).

This means absolutely nothing other than that capital lying fallow is reckoned and accounted for as though it were not lying fallow but were being exchanged for surplus labour time. This has nothing to do with value determination; it comes under the heading of price. (In the case of fixed capital it comes into the determination of value only in so far as it is another method of the payment of objectified labour, abstracted from profit.)

./"'THERE IS ANOTHER PRINCIPLE OF LABOUR WHICH NOTHING POINTS OUT TO THE ECONOMICAL INQUIRER IN OLD COUNTRIES, BUT OF WHICH EVERY COLONIAL CAPITALIST HAS BEEN MADE CONSCIOUS IN HIS OWN PERSON. BY FAR THE GREATER PART OF THE OPERATIONS OF INDUSTRY, AND ESPECIALLY THOSE OF WHICH THE PRODUCE IS GREAT IN PROPORTION TO THE CAPITAL AND LABOUR EMPLOYED, REQUIRE A CONSIDERABLE TIME FOR COMPLETION. AS TO MOST OF THEM, IT IS NOT WORTH WHILE TO MAKE A COMMENCEMENT WITHOUT THE CERTAINTY OF BEING ABLE TO CARRY THEM ON FOR SEVERAL YEARS. A LARGE PORTION OF THE CAPITAL EMPLOYED IN THEM IS FIXED, INCONVERTIBLE, DURABLE. I F ANYTHING HAPPENS TO STOP THE OPERATION, ALL THIS CAPITAL IS LOST. IF THE HARVEST CANNOT BE GATHERED, THE WHOLE OUTLAY IN MAKING

IT GROW HAS BEEN THROWN AWAY... T h i s s h o w s t h a t CONSTANCY IS A NO LESS IMPORTANT PRINCIPLE AS COMBINATION OF LABOUR. T H E IMPORTANCE OF THE PRINCIPLE

OF CONSTANCY IS NOT SEEN HERE, BECAUSE RARELY INDEED DOES IT HAPPEN, THAT THE LABOUR WHICH CARRIES ON A BUSINESS, IS STOPPED AGAINST THE WILL OF THE CAPITALIST... But in the COLONIES exactly the reverse happens. Here CAPITALISTS ARE

SO MUCH AFRAID OF IT, THAT THEY AVOID ITS OCCURRENCE AS MUCH AS THEY CAN, BY AVOIDING AS MUCH AS POSSIBLE OPERATIONS WHICH REQUIRE MUCH TIME FOR THEIR COMPLETION" (Wakefield, [A View of the Art of Colonisation, London, 1849,] pp. 169-70, XIV [70,] 71). "THERE ARE NUMEROUS OPERATIONS OF SO SIMPLE A KIND AS

NOT TO ADMIT A DIVISION INTO PARTS, WHICH CANNOT BE PERFORMED WITHOUT THE CO-OPERATION OF MANY PAIRS OF HANDS. E.G. THE LIFTING OF A LARGE TREE ONTO A WAIN, KEEPING DOWN WEEDS IN A LARGE FIELD OF GROWING CROP, SHEARING A LARGE FLOCK OF SHEEP AT THE SAME TIME, GATHERING A HARVEST OF CORN AT THE TIME WHEN IT IS RIPE ENOUGH AND NOT TOO RIPE, MOVING ANY GREAT WEIGHT; EVERYTHING, IN SHORT, WHICH CANNOT BE DONE UNLESS A GOOD MANY PAIRS OF HANDS HELP TOGETHER IN THE SAME UNDIVIDED EMPLOYMENT, AND AT THE SAME TIME" (L.C, P. 168). "COMBINATION AND CONSTANCY OF LABOUR ARE PROVIDED FOR IN OLD COUNTRIES, WITHOUT AN EFFORT OR [A] THOUGHT ON THE PART OF THE CAPITALIST, MERELY BY THE ABUNDANCE OF LABOURERS FOR HIRE. T H E SCARCITY OF LABOURERS FOR HIRE IS THE UNIVERSAL COMPLAINT OF

COLONIES" (l.C, p . 1 7 0 ) . " O n l y t h e CHEAPEST LAND IN A COLONY ISTHAT WHOSE PRICE AFFECTS THE LABOUR MARKET. THE PRICE OF THIS LAND, AS OF ALL BARE LAND, AND OF EVERYTHING ELSE WHICH IT COSTS NOTHING TO PRODUCE, DEPENDS OF COURSE ON THE RELATION BETWEEN THE DEMAND AND THE SUPPLY" [I.e., p . 3 3 2 ] . " I N ORDER THAT THE PRICE OF WASTE LAND SHOULD ACCOMPLISH ITS OBJECTS" (i.e. to make the worker into a non-proprietor of land) "IT MUST BE SUFFICIENT FOR THE PURPOSE. HITHERTO THE PRICE

HAS BEEN EVERYWHERE INSUFFICIENT" (I.e., p . 338).

O n t h i s "SUFFICIENT" PRICE:

" I N FOUNDING A COLONY T H E PRICE M I G H T BE SO LOW AS T O RENDER T H E QUANTITY

O F LAND APPROPRIATED BY SETTLERS PRACTICALLY UNLIMITED: I T M I G H T BE HIGH ENOUGH T O OCCASION A PROPORTION BETWEEN LAND AND PEOPLE SIMILAR T O THAT OF

OLD COUNTRIES, IN WHICH CASE, IF THIS VERY HIGH PRICE DID NOT PREVENT EMIGRATION,

THE CHEAPEST LAND IN THE COLONY MIGHT BE AS DEAR, AND THE SUPERABUNDANCE OF LABOURERS AS DEPLORABLE AS IN ENGLAND: OR IT MIGHT BE A JUST MEDIUM BETWEEN

THE TWO, OCCASIONING NEITHER SUPERABUNDANCE OF PEOPLE NOR SUPERABUNDANCE OF LAND, BUT SO LIMITING THE QUANTITY OF LAND, AS T O GIVE THE CHEAPEST LAND A MARKET VALUE, THAT WOULD HAVE THE EFFECT OF COMPELLING LABOURERS T O WORK SOME CONSIDERABLE TIME FOR WAGES BEFORE THEY COULD BECOME LANDOWNERS" (I.e., p. 339) (Notebook XIV, 71).

(The passage here quoted from Wakefield's Art of Colonisation belongs to those quoted above concerning the necessary separation of the worker from the conditions of property.)//

[VI-3] (The calculation of profit as distinct from that of the real surplus value which capital posits in its exchange with living labour, is clear e.g. in the following example.^[145] It is A STATEMENT in the First Report of the Factory Commissioners. (Malthus, Principles of Political Economy, 2nd ed. [London,] 1836, [pp. 269-70] (Notebook X, p. 42).)

CAPITAL SUNK IN BUILDING AND MACHINERY £10,000 FLOATING CAPITAL 7,000 £ 500 INTEREST ON £10,000 FIXED CAPITAL 350 ON FLOATING CAPITAL 150 RENTS, TAXES, RATES 650 SINKING FUND OF 6V2[%] FOR WEAR AND TEAR OF THE FIXED CAPITAL

£ 1,650 £ 1,100 CONTINGENCIES, CARRIAGE, COAL, OIL

2,750 2,600 WAGES AND SALARIES

5,350 10,000 FOR ABOUT 400,000 LBS. RAW COTTON AT 6D.

15,350 16,000 FOR 363,000 LBS TWIST SPUN. VALUE £16,000

The capital laid out on labour is 2,600; surplus value is=to 1,650 (850 INTEREST+150 RENTS, etc., making 1,000+650 profit).

But 2,600:1,650= 100:63 ^[6]/i3- Hence the rate of surplus value is 63^[6]/i3%. If calculated in the same way as [the rate of] profit itself, the figures would be 850 INTEREST, 150 RENTS, [etc.,] and 650 profit, or 1,650:15,350; over 10.7%.

In the above example, the circulating capital is turned over 1 ^[67]/7o times a year; the fixed capital is turned over once in 15^[5]/i3 years, once in ^[20]%3 years.^[146]

Profit: 650 OR ABOUT 4.2% [on the capital of £15,350 annually employed]. The WAGES of the OPERATIVES [and salaries] l/^[6] [of the yearly outlay]. Profit is stated here at 4.2%; let us say it was only 4%. This 4% is calculated on an outlay of 15,350. But then we still have [to add] 5% INTEREST on £10,000 and 5% on 7,000; £850 = 5% on 17,000.

We must deduct from the annual ADVANCES actually MADE (1) the part of fixed capital which does not figure in the SINKING FUND; (2) that which is calculated as INTEREST. (It is possible that capitalist B, not capitalist A, pockets the interest. In any case, it is income, not capital; surplus value.) 850 must therefore be deducted from the outlays of 15,350; leaves: 14,500. Of the 2,600 for WAGES and SALARIES there were £41 ^[2]/ ^[3] in the form of SALARY; since l/^[6] of 15,350 is not 2,600, but 2,558 7^[3]-^[147] This divided by 14,500 is [1:] 5205/^[3]o^[7], say [1:] 6.

He therefore sells the 14,500 for 16,000, giving him a profit of 1,500 or 10^[10]/29%- We can ignore the ^[10]/^[2]9% and take [the rate of profit as] 10%; 7^[6] of 100 is 16^[2]/^[3]. Thus 100 [capital] would yield 83 Vs for ADVANCES [on constant capital], 16^[2]/^[3] for wages, and profit 10. Thus:

ADVANCES Wages Sum Reproduced Profit £ 83 y ^[3] 16^[2]/^[3] 100 110 10

10 on 16^[2]/^[3] or on ^[5]% is EXACTLY 60%. Therefore, if the capitalist on his own calculation is to derive an annual profit of 10% (actually, it was somewhat greater) on a capital of £17,000, wherein labour accounts for only ^[1]/^[6] of the annual ADVANCES of £14,500, the worker (or capital, if you prefer) must produce a surplus value of 60%. Or 62 72% of the total labour time is for necessary labour and 37 7^[2]% for surplus labour. Their ratio is 625:375 or 5:3 or l:^[3]/^[5]. If, however, the ADVANCES on capital had been 50, the ADVANCES on wages also 50, then a surplus value of only 20% would have to be produced for the capitalist to derive [a profit of] 10%; 50+50+10=110. But 10:50 is 20:100 or 20%. If necessary labour posited as much surplus labour in the second CASE as in the first, the profit of the capitalist would amount to £30. On the other hand, if the rate of real value creation, of the positing of surplus labour, were only as large in the first CASE as in the second, profit would amount only to £3 7^[3]; and if the capitalist had to pay 5% interest to another capitalist, he would have to carry an actual

LOSS.

This much arises simply from the formula: (1) that to measure the real [rate of] surplus value, one must calculate the profit on the ADVANCE made for wages; the percentage which expresses the proportion between the so-called profit and wages; (2) the relatively smaller percentage expressing the proportion between the outlay on living labour and the total outlay, presupposes a greater outlay on fixed capital, machinery, etc., a greater division of labour. Although the percentage of labour is therefore smaller than in the case of the capital working with more labour, the mass of labour it actually sets in motion must be significantly greater, i.e. a greater capital generally has to be worked with. The fractional part of labour relative to total ADVANCES is smaller; but the absolute sum of labour set in motion is greater for the individual capital, which means that this capital must itself be greater. (3) If we are dealing not with a greater quantity of machinery, etc., but with an instrument which does not set more labour in motion, and does not itself represent a great fixed capital (e.g. a manually operated lithographic press), but simply replaces labour, then the profit of one [the capitalist] using that instrument is absolutely smaller than that of one working with living labour. (But the former can make a percentage of profit higher than the latter and therefore drive him from the market.) (etc.) The examination of how far the rate of profit can decline as capital grows, in such a way that GROSS PROFIT still increases, belongs in the theory of profit (competition).

In his Principles of Political Economy, 2nd ed., [London,] 1836, Malthus has an inkling of the fact that profit, i.e. not profit but real surplus value, must be calculated not in relation to the capital advanced, but to the living labour advanced, whose value is objectively expressed in wages. But this leads him into pure trivialities, which become absurdities when he tries to use them as a basis for the determination of value or for statements concerning the relation of labour to value determination.

For if I take the total value of the finished product, then I can compare every part of the product advanced with the corresponding part of the outlays; and the percentage of profit in relation to the whole product is of course also the percentage for the fractional part of the product. Say e.g. 100 thaler yielded 110. Thus 10% on the whole product. Say that 75 thaler is for the invariable part of capital, and 25 for labour; hence ^[3]/^[4] [VI-4] for the former and i/^[4] for living labour. If I now take 'At from the total product, i.e. from 110, I obtain 27 % or 27 l/^[2]. On an outlay of 25 for labour, the capitalist has gained 2i/^[2],i-e-10%. Malthus could just as well have said, if I take s/^[4] from the total product, i.e. 75, then these ^[3]/^[4] are represented in the total product by 82 l/^[2], thus 7 V2 out of 75 is EXACTLY 10%. Obviously, this means nothing more than that if my profit is 10% on 100, the profit on every part of the 100 is as much as will in total add up to 10% on the overall sum. If my profit is 10 on 100, then on 2x50 my profit is 5 each time, etc. The knowledge that, if my profit is 10 on 100, it is 2 V2 ° n V4 of 100, and 7 V2 o n ^[3]U, does not get us one step further. If my profit is 10 on 100, then what is it on ^[1]/^[4] of 100 or on ^[3]/^[4]? Malthus's inspiration comes down to this sort of trivial-ity. The advance on labour amounted to l/^[4] of 100, hence the profit on it was 10%, which is 2 V2 on 25. Or if the capitalist's profit is 10 on 100, it is V10 ° n each part of his capital, i.e. 10%. This does not in any way give the parts of capital any qualitative character relative to one another, and therefore this is just as true of fixed capital, etc., as it is of that advanced in labour.

Moreover, this [procedure] merely expresses the illusion that every part of capital has contributed equally to the newly created value. Not even the l/^[4] advanced for wages has created surplus value, but the unpaid living labour. But from the proportion of total value [outlays deducted]—in this case 10 thaler — to wages, we can ascertain what percentage of the labour has not been paid, or how much was surplus labour. In the above relation, necessary labour is objectified in 25 thaler, surplus labour in 10; hence their ratio is 25:10=100:40; 40% of labour was surplus labour or, what is the same thing, 40% of the value it created was surplus value. It is quite true that the capitalist can calculate thus: if my profit is 10 on 100, my profit on the wages of 25 is 2 72- It is not possible to see what use this calculation is supposed to be. But the purpose Malthus has in mind we shall see shortly when we go into his determination of value. That he actually believes that his simple arithmetical example contains a real determination is clear from the following:

"Suppose that capital is wholly expended in wages; £100 EXPENDED IN IMMEDIATE LABOUR. The RETURNS at the end of the year 110, 120 or 130; IT IS EVIDENT THAT IN EACH CASE THE PROFITS WILL BE DETERMINED BY THE PROPORTION OF THE VALUE OF THE WHOLE PRODUCE WHICH IS REQUIRED TO PAY THE LABOUR EMPLOYED. IF THE VALUE OF THE PRODUCE IN THE MARKET=110, THE PROPORTION REQUIRED TO PAY THE LABOURERS=10/ll of the VALUE of the PRODUCE, or PROFITS=10%" [p. 267], (Here Mr. Malthus merely expresses the original advance, £100, as a proportion of total product. 100 is 10/n of 110. To say that my profit is 10 on 100, i.e. Vio °f 100, is the same as saying that Vu of the 110 is profit.)

"If the value of the produce be 120, the proportion for LABOUR= 1 0/ 1 2, and profits 20%; if 130, the PROPORTION REQUIRED TO PAY THE LABOUR='°/I3, and profits = 30%" [ibid.].

(Instead of saying that my profit is 10 on 100, I can also say that the advances amount to 10/u of the 110; or if my profit is 20 on 100, that the advances amount to 10/12 of 120, etc. The character of these advances, whether in LABOUR or OTHERWISE, has absolutely nothing to do with this arithmetical form of expressing the matter. If a capital of 100 has only yielded 110, I can either set out from the capital and say that I have gained 10 on it; or I can set out from the product of 110 and say that I have previously advanced only 10/n of it. The relation is of course the same.)

"Now suppose that the ADVANCES of the CAPITALIST do not consist of LABOUR alone ... the capitalist expects an equal profit upon all the parts of the capital which he advances" [pp. 267-68].

(This only means that he attributes the profit he has made, and about whose origin he may be very much in the dark, equally to all parts of his expenses, abstracting entirely from their qualitative difference.)

"Assume that V4 of his ADVANCES [are] for (immediate) LABOUR, and ^[3]/^[4] consist of ACCUMULATED LABOUR and PROFITS, with ANY ADDITIONS WHICH MAY ARISE from RENTS, TAXES or other OUTGOINGS... Then it will be STRICTLY TRUE THAT THE PROFITS

OF THE CAPITALIST WILL VARY WITH THE VARYING VALUE of this 1/4 of the PRODUCE

COMPARED WITH THE QUANTITY OF LABOUR EMPLOYED" [ibid].

(Not [compared with the] QUANTITY [of labour employed], as Mr. Malthus has it, but COMPARED WITH THE WAGES PAID.)

( I t i s t h u s STRICTLY TRUE THAT HIS PROFITS WILL VARY WITH THE VARYING VALUE OF

THE 3 / 4 OF HIS PRODUCE COMPARED WITH THE ADVANCES IN ACCUMULATED LABOUR, i . e .

profit relates to the total capital advanced (10:100) in the same way as each part of the total product (110) relates to the part of the ADVANCES corresponding to it.)

"As an instance let us suppose," continues Malthus, "that a FARMER employs in CULTIVATION £2,000, 1,500 of which he expends IN SEED, KEEP OF HORSES, WEAR and TEAR OF HIS FIXED CAPITAL, etc., and £500 on IMMEDIATE LABOUR; and that the RETURNS obtained at the end [of the year] are worth 2,400. His profits will be 400 on 2,000=20%. It is straight away OBVIOUS THAT IF WE TOOK X/4 of the VALUE of the PRODUCE, namely £600, and COMPARED IT WITH THE AMOUNT PAID IN THE WAGES OF THE IMMEDIATE LABOUR, THE RESULT WOULD SHOW EXACTLY THE SAME RATE OF PROFITS" (I.e., pp. 267, 268. Notebook X, 41, 42).

(It is equally OBVIOUS that IF WE TOOK ^[3]/ ^[4] of the VALUE of the PRODUCE, namely 1,800, and COMPARED IT WITH THE AMOUNT PAID IN THE ADVANCES OF ACCUMULATED LABOUR, namely with 1,500, THE RESULT WOULD SHOW EXACTLY

THE SAME RATE OF PROFITS. 1,800:1,500=18:15 = 6:5. But 6 is Vs more than 5, hence 20%.)

(Malthus here has two different arithmetic forms in his head, and jumbles them together. Firstly: If my profit is 10 on 100, I have not gained 10 on each part of 100, but 10%; therefore 5 on 50, 2 V^ on 25, etc.; if I make 10 on 100, I have gained Vio o n

each part of 100, and profit must work itself out as Vio profit on wages. If profit is attributed equally to all parts of the capital, I can say that the rate of profit on total capital varies with the rate of profit on each of its component parts, and thus e.g. also on that advanced in wages. Secondly: If I have made 10% on 100, then total product is 110. If wages were l/^[4] of the advances=25, they now represent only a 4 ^[2]/ ^[5]th part of 110; i.e. a fraction which is smaller by ^[2]/s, and it will [have] to constitute a smaller part of the total product in the same proportion as the total product has increased in comparison with the original [capital]. This, again, is merely a different type of calculation. 10 is Vio of 100, but only Vu of 110. Therefore, I can say that in the same proportion as total product increases, each of the fractional parts of the original capital constitutes a smaller part of it. Tautology.)

In his work, The Measure of Value Stated and Illustrated, London, 1823, (Notebook IX), Malthus asserts that the - VAL UE OF LABOUR- is

••CONSTANT" and is thus the TRUE MEASURE OF VALUE GENERALLY.

"ANY GIVEN QUANTITY OF LABOUR MUST BE OF THE SAME VALUE AS THE WAGES WHICH COMMAND IT, OR FOR WHICH IT ACTUALLY EXCHANGES" (I.e., p. 5) (IX, 29).

H e is of course referring to wage labour. T h e truth of the matter is rather that ANY GIVEN QUANTITY OF LABOUR is=to the same QUANTITY OF LABOUR expressed in a product; or every product is only a particular amount of labour, objectified in the value of the product. T h e value of this product relative to that of others is measured by this amount. Certainly wages express the value of living labour capacity, but not at all that [VI-5] of living labour, which is expressed rather in terms of wages+profit. Wages are the price of necessary labour. If the worker had to work for 6 hours to live, and h e produced only for himself, as a pure worker, he would obtain commodities [to the value] of 6 hours' labour, say 6d., each day. Now the capitalist sets him to work for 12 hours and pays him 6d. H e pays him l/zd. per hour. I.e. A GIVEN QUANTITY

OF 1 2 HOURS OF LABOUR HAS THE VALUE OF 1 2 D . , AND ^{[1] [2]} D . IS INDEED THE VALUE FOR

WHICH THE PRODUCE EXCHANGES, WHEN IT GETS SOLD.

O N THE OTHER HAND, THE CAPITALIST COMMANDS WITH THIS VALUE, IF HE COULD

REINVEST IT IN MERE LABOUR, 2 ^[4] HOURS. T H E WAGES COMMAND, THEREFORE, A MUCH

GREATER QUANTITY OF LABOUR THAN THEY CONSIST OF, AND A GIVEN QUANTITY OF

LIVING LABOUR ACTUALLY EXCHANGES FOR A MUCH SMALLER ONE OF ACCUMULATED

LABOUR. T H E ONLY THING THAT IS SURE IS THAT THE PRICE OF LABOUR, WAGES, MUST

ALWAYS EXPRESS THE QUANTITY OF LABOUR WHICH THE LABOURERS WANT IN ORDER TO

KEEP SOUL AND BODY TOGETHER. T H E WAGES OF ANY QUANTITY OF LABOUR MUST BE

EQUAL TO THE QUANTITY OF LABOUR WHICH THE LABOURER MUST EXPEND UPON HIS

OWN REPRODUCTION. I N THE ABOVE INSTANCE A MAN WOULD SET TO WORK TWO MEN FOR

^{[1 2]} HOURS EACH — TOGETHER 2 4 HOURS — WITH THE QUANTITY OF LABOUR AFFORDED BY ONE MAN. In the above example, the product would be exchanged for another product to the value of 12d., or for 12 hours' labour, and in this way its profit of 6d. would arise (ITS SURPLUS VALUE for the capitalist).

The value of products is determined by the labour contained in them, not by that part of it which the employer pays for. Labour performed, not labour paid for, constitutes the value of the product; but WAGES express only labour paid for, never the labour actually performed. The measure of this payment itself depends on the productivity of labour, for this determines the quantity of necessary labour time; and since WAGES constitute the VALUE OF LABOUR (LABOUR itself posited as a commodity), this VALUE is continuously VARIABLE, and anything but CONSTANT. The quantity of labour actually performed by the worker is very different from the quantity which is embodied in his labour capacity, or which is necessary to reproduce his labour capacity. But as commodity he does not sell the use which is made of it; he does not sell himself as CAUSE but as EFFECT. Let us hear how Mr. Malthus exerts himself to get on top of the matter:

" T H E CONDITIONS OF THE SUPPLY OF COMMODITIES DO NOT REQUIRE THAT THEY SHOULD RETAIN ALWAYS THE SAME RELATIVE VALUES; BUT THAT EACH SHOULD RETAIN ITS PROPER NATURAL VALUE, OR THE MEANS OF OBTAINING THOSE OBJECTS WHICH WILL CONTINUE TO THE PRODUCER THE SAME POWER OF PRODUCTION AND ACCUMULATION ... PROFITS ARE CALCULATED UPON THE ADVANCES NECESSARY TO PRODUCTION ... THE SPECIFIC ADVANCES OF CAPITALISTS DO NOT CONSIST OF CLOTH, BUT OF LABOUR; AND AS NO OTHER

OBJECT WHATEVER CAN REPRESENT A GIVEN QUANTITY OF LABOUR,it is c l e a r t h a t it is the QUANTITY OF LABOUR WHICH A COMMODITY WILL COMMAND, AND NOT THE QUANTITY OF

ANY OTHER COMMODITY, WHICH CAN REPRESENT THE CONDITION OF ITS SUPPLY, OR ITS NATURAL VALUE" ( p p . 17, 18) ( I X , 2 9 ) .

From the fact alone that the ADVANCES of the CAPITALIST consist OF LABOUR, Malthus could see that something was wrong with this line of argument. Suppose that necessary labour time is 6 hours; A and B, two fellows both working for themselves but exchanging with one another. Let A work 6 hours, B 12 hours. If A now wishes to eat up the extra 6 hours which B has worked, wants to consume the product of the 6 surplus hours worked by B, he can do so only by giving B 6 hours of living labour, say on the next day. But B now possesses a product of 6 hours' work over and above that in A's possession. Assume now that in this situation B imagined himself as a capitalist, and stopped working altogether. On the third day, he would only have his ACCUMULATED PRODUCE of 6 hours to exchange for A's 6 hours [of living labour]; and as soon as he completed the exchange, he would have to take up working again or die of starvation. But if he continued to work 12 hours for A, and A continued to work 6 hours for himself and 6 for B, they would both exchange exactly 12 hours with one another.

The NATURAL VALUE of the COMMODITY, Malthus says, consists in its ability to return to its owner, by means of exchange, THE SAME POWER OF PRODUCTION AND ACCUMULATION. His commodity is composed of two distinct quantities of labour: one of accumulated labour, and one of IMMEDIATE labour. Hence, if he exchanges his commodity for another commodity which contains exactly the same total quantity of labour, his POWER OF PRODUCTION and ACCUMULATION is at least the same, undiminished. In fact, however, it has grown, because a part of the IMMEDIATE labour has cost him nothing, and yet he sells it. Malthus, however, concludes that the quantity of labour of which the commodity consists is only labour which has been paid for, and therefore=the sum of WAGES; or that WAGES provide the measure of the value of the commodity. If every quantity of labour contained in the commodity were paid for, Mr. Malthus's doctrine would be correct. But then it would be equally correct to say that his capitalist would not have to make any "ADVANCES OF LABOUR- and he would lose his "POWERS OF ACCUMULATION" altogether.

Where should profit come from if no gratis labour is performed? Ah, says Mr. Malthus, from the WAGES for ACCUMULATED labour. But since labour already performed has ceased to labour, it also ceases to draw WAGES. True, the product in which it exists could be exchanged again for living labour. But assume this product to be=to 6 hours' labour; the worker would then supply 6 hours of living labour and receive in return the ADVANCES, the 6 hours of already performed labour in the possession of the capitalist, who would have gained nothing from this transaction. Living labour would very soon be in possession of his dead labour. The reason put forward by Malthus is that, because "NO OTHER OBJECT WHATEVER CAN REPRESENT A GIVEN QUANTITY OF LABOUR", the NATURAL VALUE of a commodity consists of the

"QUANTITY OF LABOUR WHICH A COMMODITY WILL COMMAND, AND NOT THE

QUANTITY OF ANY OTHER COMMODITY" [ ibid . , p . 1 8 ] , i . e . A GIVEN QUANTITY OF LABOUR can only be represented by A QUANTITY OF LIVING (IMMEDIATE) LABOUR. But far from -NO OTHER" object being able TO REPRESENT A GIVEN

QUANTITY OF LABOUR, EVERY OBJECT WHATEVER CAN d o SO, viz . e v e r y o b j e c t in which the same QUANTITY [of] LABOUR is contained. Yet Malthus wants the QUANTITY OF LABOUR contained in the commodity to be measured; in his view, it should be equal to the quantity of paid labour which it sets in motion, not that of living labour which it can set in motion.

Assume that the commodity contains 24 hours of labour. Malthus imagines that the capitalist can buy 2 days' labour with it; and if the capitalist paid for the full amount of the labour [contained in it], or if the quantity of labour already performed were = to the quantity of paid living labour, he could buy only 24 hours of living labour with 24 hours of labour already performed, and his "POWERS OF ACCUMULATION" WOULD HAVE GONE TO THE WALL. But the capitalist does not pay the worker for the labour time, the quantity of labour, but merely for the necessary labour time, while he compels him to work for the REST of the time free of charge. With the 24 hours' accumulated labour time, he will thus set in motion perhaps 48 hours of living labour. With one hour of accumulated labour, he therefore pays IN FACT for 2 hours of living labour, and hence gains 100% on the exchange. The value of his commodity now=48 hours; but it is in no way equal to the WAGES for which it has been exchanged, nor to the WAGES for which it is again exchanged. If he continues in the same relation, he will purchase 96 hours of living labour with 48. hours of accumulated labour.

Suppose, that not a single capitalist existed, but only workers directly exchanging with one another, who worked more than was necessary to live, because they also wished to accumulate, etc. Call the part of the labour which the worker performs in order to live WAGES, and the surplus time he works in order to accumulate, profit. In this case, the value of his commodity would=the total quantity of labour contained in it=the total sum of living labour time; but in no way would it=the WAGES which he paid himself, or be equal to the part of the commodity which he would have to reproduce in order to live.

Because the value of a commodity is=to a certain quantity of labour, Malthus asserts that it is=to the quantity of necessary labour contained in it (i.e. the WAGES) and not to the total sum of labour contained in it; i.e. its whole is=to a fraction of it. [VI-6] Obviously, the worker's "POWERS OF ACCUMULATION- could only arise from the fact that he had worked more than was necessary to pay his WAGES to himself. If a particular quantity of living labour were=to the time for which the worker must work to live, then a particular quantity of living labour would be=to the WAGES which he produces, or the WAGES would be exactly equal to the living labour which they set in motion. If such were the case, capital would of course be impossible. If a worker cannot produce more than his WAGES in his entire labour time, he cannot with the best will in the world squeeze out a farthing for the capitalist. PROPERTY

is THE OFFSPRING OF THE PRODUCTIVITY OF LABOUR.

"If one can produce only for one, everyone a worker; THERE COULD BE NO PROPERTY. WHEN ONE MAN'S LABOUR CAN MAINTAIN 5, THERE WILL BE 4 IDLE MEN FOR 1 EMPLOYED IN PRODUCTION" (Ravenstone f Thoughts on the Funding System, and Its Effects, p. 11]).

We have seen above how Malthus's fanciful profundity expressed itself in a purely childish kind of arithmetic. Incidentally, behind it lay the doctrine that THE VALUE OF LABOUR is constant and that WAGES constitute price. Because the rate of profit upon an entire capital can be expressed as the same rate upon the fractional part which represents WAGES, he asserts that this fractional part constitutes and determines price. Exactly the same profundity as here. If commodity a —an amount of x commodity, he imagines that this can only mean that commodity a = x living labour, for only labour can represent labour. From this he concludes that commodity a=the quantity of xvage labour it can command, and that therefore the value of labour is constant, because it is always = to [that of] the commodity by which it is set in motion. The point is simply that he equates the quantity of living labour with that of wage labour, and that he believes that every fractional part of wage labour is really paid for. But x living labour can be (and as wage labour is on\y) = x — y necessary labour (WAGES) + y surplus labour. Hence x dead labour can set in motion x — y necessary labour (WAGES) + y surplus labour time, i.e. it always sets in motion as much additional living labour time as there are hours of surplus labour time over and above necessary labour time in x hours of labour.

Wage labour always consists of paid and unpaid labour. To say that the VALUE of labour is constant therefore means nothing other than that all labour time is necessary labour time, i.e. labour time producing WAGES. There is no surplus labour time and — nevertheless there are POWERS OF ACCUMULATION- and capital. Since WAGES are always equal to a given quantity of labour, i.e. the quantity of living labour which they set in motion, and this is the same quantity of labour which is contained in the WAGES, the value of labour is constant, since it is always=to the quantity of labour objectified. The fall and rise of wages thus stems from the fall and rise of the price of commodities, not of the value of labour. Whether a worker gets 8 or 16 shillings in silver a week, depends only on whether the price of shillings has risen or fallen, but the value of labour has remained the same. In both cases, he receives a week of accumulated labour for a week of living labour. Mr. Malthus proves this in the following way:

"If labour alone, without capital, WERE EMPLOYED IN PROCURING THE FRUITS OF

THE EARTH, THE GREATER FACILITY OF PROCURING ONE SORT OF THEM COMPARED WITH ANOTHER, WOULD NOT, IT IS ACKNOWLEDGED, ALTER THE VALUE OF LABOUR, OR THE EXCHANGEABLE VALUE OF THE WHOLE PRODUCE OBTAINED BY A GIVEN QUANTITY OF EXERTION" [Th. R. Malthus, The Measure of Value Stated and Illustrated, p. 33].

This means nothing but that [the value of] every commodity, leaving aside its quantity, would be determined by the labour contained in it, although this labour would be expressed in a greater quantity of use values in one CASE and a lesser quantity in another, depending upon the degree of its productivity.

" WE SHOULD, WITHOUT HESITATION, ALLOW THAT THE DIFFERENCE WAS IN THE CHEAPNESS OR DEARNESS OF THE PRODUCE, NOT OF THE LABOUR" [IBID.].

We should say that labour is more productive in the one branch of production than in the other, or also that the product costs more or less labour. In as much as no wage labour existed, we could not speak of CHEAPNESS OR DEARNESS OK LABOUR. Hence an hour of immediate labour would always command an hour of objectified labour, which would not of course prevent one hour's labour being more productive than another's. Nevertheless, in so far as we distinguish the part of labour necessary for subsistence, from surplus labour — and if any hours of the day at all are worked as surplus time, it is the same as if each fractional part of labour time consisted of one part necessary and one part surplus labour— done by the IMMEDIATE LABOURERS, it could not be said that the value of labour, i.e. WAGES, the part of the product which is exchanged for necessary labour, or the part of total labour bestowed on the necessary product, is constant. The fractional part of labour time which reproduces WAGES would change with the productivity of labour. Consequently, the value of labour, i.e. WAGES, would constantly vary with the productivity of labour. WAGES would still be measured by a definite use value; and since the exchange value of this use value constantly varies with changes in the productivity of labour, WAGES or the value of labour would vary. The concept of the value of labour in any case implies that living labour is not equal to its product, or, what is the same thing, that it is sold not as an acting cause but as itself a produced effect. To say that the value of labour is constant means nothing but that it is constantly measured by the quantity of labour contained in it.⁽⁷⁾

A product may contain a greater or lesser quantity of labour. Hence at various times a greater or a lesser portion of product a may exchange for product b. But the quantity of living labour which the product purchases can never be greater or smaller than the quantity of accumulated labour it represents; for a particular quantity of labour is always a particular quantity of labour, whether it exists in the form of objectified or that of living labour. If, therefore, a greater or lesser quantity of a product is given for a certain quantity of living labour, i.e. if wages rise or fall, this does not stem from a rise or fall in the value of labour, for the value of a particular quantity of labour is always equal to the same quantity of labour. It is due rather to the fact that the products cost more or less labour, and so a greater or lesser quantity of the products represents the same quantity of labour.

The value of labour therefore remains constant. Only the value of the products changes, i.e. the productive power of labour varies, not its value. This is THE PITH OF THE THEORY OF MALTHUS, IF YOU CAN CALL SUCH A SHALLOW FALLACY A THEORY. D'abord, a product which costs only half a day's labour time may enable me to subsist, and thus also to work, for a whole day. Whether or not the product possesses this property does not depend on its value, i.e. on the labour time which is bestowed on it, but on its use value. And the exchange which takes place between living labour and the product of labour on this basis, is not an exchange of the two as exchange values, but their relation resides partly in the use value of the product and partly in the conditions of existence of living labour capacity.

If objectified labour is exchanged for living labour, then, according to the laws of exchange value, the product which=half a day's labour could only purchase half a day's living labour, although the worker could live a whole working day on it. And if his entire working day were to be purchased, he would have to receive a whole working day in product, on which by our assumption he could live for two working days. But on the basis of capital, living labour and accumulated labour do not exchange for one another as exchange values so that both would be identical, and the same quantity of labour in objectified form would be the value of, the equivalent for, the same quantity of [VI-7] labour in living form. What is exchanged, rather, is product and labour capacity, which is itself a product. Labour capacity is not=to the living labour which it can perform, i.e. the quantity of labour which it can accomplish — this is its use value. It is equal to the quantity of labour by which it itself must be produced and can be reproduced. Hence the product is not IN FACT exchanged for living labour but for objectified labour, labour objectified in the labour capacity. Living labour itself is a use value possessed by the exchange value acquired in the bargain by the owner of the product. How little or how much more of this living labour he has traded in than he has expended — in the form of the product— for the labour capacity, depends on the quantity of living labour which has been paid to the worker in the product.

If a quantity of labour exchanged for an [equal] quantity of labour, whether in the form of objectified or of living labour, every quantity of labour would of course be equal to itself, and its value would be equal to its quantity. In that case, a product of half a day's labour could only purchase half a day's labour. But then, IN FACT, there would exist neither WAGES nor value of labour. Labour would have no value distinct from its product, or from the equivalent of its product, no specific value, and it is precisely this specific value which constitutes the value of labour, WAGES.

From the fact, therefore, that a certain quantity of labour=a certain quantity of labour, or also from the fact that a certain quantity of labour=itself; from the great discovery that a certain quantity is a certain quantity, Mr. Malthus concludes that wages are constant and that the value of labour is constant, i.e. [that they both]=the same quantity of objectified labour. This would be correct, if living labour and accumulated labour were exchanged for one another as exchange values. But then neither the value of labour nor WAGES nor capital nor wage labour, nor Malthus's investigations, would exist. These are all based on the fact that in relation to labour accumulated in capital, living labour is use value and living labour capacity is exchange value. Malthus continues calmly:

"The same is true if capital and PROFITS ENTER INTO THE COMPUTATION OF VALUE and the DEMAND FOR LABOUR VARIES" [ibid., p. 33].

H e r e we have the whole profundity. As soon as capital and profits enter the scene, it transpires that living labour capacity is purchased, and therefore a smaller portion of accumulated labour is exchanged for a greater portion of living labour. It is altogether characteristic of his profundity that capital, which posits wage labour and transforms labour into wage labour and labour capacity into a commodity, brings about absolutely no CHANGE in the utilisation of labour, as little as it does in that of accumulated labour. Capital, a specific form of the relation of labour to its product and to the value of this product, ••ENTERS", according to Malthus, WITHOUT CHANGING ANYTHING. It is as though he recognised n o change in the constitution of the Roman Republic as a result of the "ENTERING OF EMPERORS".

H e continues:

"If AN INCREASED REWARD goes to the LABOURERS without an INCREASE in the PRODUCE, this is only possible on account of a FALL OF PROFITS. T O OBTAIN ANY GIVEN PORTION OF THE PRODUCE THE SAME QUANTITY OF LABOUR IS NECESSARY AS BEFORE, BUT PROFIT BEING DIMINISHED, THE VALUE OF THE PRODUCE IS DECREASED, WHILE THIS DIMINUTION OF PROFITS IN REFERENCE T O THE VALUE OF WAGES IS JUST COUNTERBAL-ANCED BY THE INCREASED QUANTITY OF LABOUR NECESSARY T O PROCURE THE INCREASED PRODUCE AWARDED T O THE LABOURER, LEAVING THE VALUE OF LABOUR THE SAME AS BEFORE" (I.e., pp. 33, 34, Notebook IX, 29).

By assumption, the product contains the same QUANTITY OF LABOUR [as before]. But its value is supposed to be reduced, because profits have fallen. Yet why should profits fall if the labour time contained in the product has remained the same? If wages rise, while total labour time remains the same and not because of temporary causes, such as conditions of competition being favourable to the workers — this means nothing but that the productivity of labour has fallen, that a greater quantity of time is necessary to reproduce labour capacity, i.e. that a bigger part of the living labour set in motion by capital falls to necessary time and a smaller part to surplus time. Let us leave this hair-splitting till later. For the sake of completeness, just the following conclusion:

"The converse applies in the opposite case. A SMALLER QUANTITY OF PRODUCE WOULD BE AWARDED TO THE LABOURER AND PROFITS WOULD RISE. A GIVEN QUANTITY OF PRODUCE, WHICH HAD BEEN OBTAINED BY THE SAME QUANTITY OF LABOUR AS BEFORE, WOULD RISE IN VALUE ON ACCOUNT OF THE RISE OF PROFITS; WHILE THIS RISE OF PROFITS,

IN REFERENCE TO THE WAGES OF THE LABOURER, WOULD BE BALANCED BY THE SMALLER QUANTITY OF LABOUR NECESSARY TO OBTAIN THE DIMINISHED PRODUCE AWARDED TO THE LABOURER" (Malthus, p. 35) (I.e.) (IX, 29).

We shall consider later what he says on this occasion about the implications, of his PRINCIPLE for money prices in different countries.

^Commodity a can for instance purchase one day's labour, and pays for only half a day of it (the necessary part), but exchanges for the whole day. The total quantity of labour it has purchased is then equal to necessary+surplus time. Hence, if I know that the price of necessary labour =x, the price of the entire quantity of labour would=2 x, and I could then value the newly produced commodity in WAGES, and so calculate the prices of all commodities in wages. But this would be anything but a constant value. The confusion concerning the AVERAGE TIME, let us say 12 hours, which in civilised countries must indeed be worked for the prevailing wage, whatever it may be, namely as to how much of these 12 hours is necessary labour and how much surplus labour, has made even Mr. Carey, who reduces the quantity of labour to working days (and indeed they can be reduced to living working days), realise that, because the same capital costs less and less labour time to reproduce, a machine costing £100, for example, will be reduced to only £50 as a result of the progress of the productive forces during" a given period of time, and will therefore be the result of half as much labour time, working days or labour hours, AS YOU LIKE. From this Mr. Carey concludes that the worker can buy this machine, acquire it for himself with half as many working days as before.⁽⁸⁾

He commits the slight mistake of considering the growth of surplus labour time as a gain for the worker, while on the contrary the real result is that the worker works a smaller part of the entire working day for himself and a greater part of it for capital, which means that the objective power of capital in relation to him grows rapidly and in proportion to the increase in the productive forces.

Mr. Carey lets the worker buy or borrow the machine; in short, he transforms him into a capitalist. He is supposed to achieve this greater power over capital, because the reproduction of a given amount of capital requires less necessary labour, i.e. less paid labour, in other words, because wages fall in relation to profit. In America, so long as the worker there still appropriates a part of his surplus labour himself, he may be able to accumulate enough to become e.g. a farmer (although that too is now coming to an end). Where wage labour in America can still achieve something quickly [for the worker], this occurs through the reproduction of earlier modes of production and [forms of] property on the basis of capital (e.g. of the INDEPENDENT PEASANTRY). In short, Carey regards the working days as belonging to the worker, and instead of concluding that the worker must produce more capital to be employed for the same labour time, he concludes that he needs to work less to acquire capital (to appropriate the conditions of production).^[3]

If the worker previously produced 20 machines but can now produce 40, as a result of an increase in productivity, the individual machine does indeed become cheaper. But because a smaller part of the working day is needed to produce a given quantity of this machine, it does not follow that the product of the working day has increased for the worker. On the contrary, it means that less living labour is employed to produce a given quantity of the machine. Incidentally, Mr. Carey, who is concerned with harmony, has himself discovered that [even] if the rate of profit falls, GROSS PROFIT rises, because an ever larger capital is required proportionately to the living labour employed. Therefore it becomes ever more difficult for the worker to appropriate the requisite sum of capital, the minimum of capital required for the productive employment of labour at the new stage of production. The reproduction of a fractional part of capital requires less labour time, but a larger volume of capital is required to valorise the reduced labour time. The growth of productivity is expressed in the fact that the part of capital consisting of living labour [VI-8] constantly falls in comparison with that laid out in ADVANCES, machinery, etc.

Carey's whole argument, which is of course grist to Bastiat's mill, is based on his transforming the labour time or working days necessary for production into working days belonging to the worker, while in reality this time belongs to capital, and relative to the increase in productivity an ever smaller portion of his labour time remains to the worker. The less living labour time a given capital has to buy—or the more the total sum of capital increases, and the living labour employed by it declines in proportion to its volume — the greater, according to Mr. Carey, the worker's chance of becoming an owner of capital, because capital is reproduced by less living labour. The larger the capital and the smaller the number of workers it employs in proportion to its volume, the greater these workers' chance of becoming capitalists, for is not capital now reproduced with fewer working days? Can it not, therefore, also be bought, acquired, with fewer working days?

Assume a capital of £100, which employs 50 in advances [on constant capital], 50 on labour and takes 50% profit. The decline in the rate of profit is Carey's chief hobby-horse and is bound up with the theory. Let each £1 in wages be equal to one working day=one worker. Then assume another capital, of £16,000, which employs £14,500 in advances [on constant capital], £1,500 in wages (also= 1,500 workers) and only earns 20% profit. In the first case, the product =150; in the second case (to simplify the calculation we assume the fixed capital to turn over in a year)= 19,200 (3,200 profit).

This is the most favourable CASE for Mr. Carey. The rate of profit has declined from 50 to 20%, hence by ^[3]/^[5] or 60%. The first capital yields a [surplus] product of 50, the result of 50 days' living labour; in the other CASE a [surplus] product of 3,200 produced by 1,500 workers. In the first case, one working day yields a [surplus] product of [£] 1 ; in the second, it yields a [surplus] product of [£] 2^[2]/i^[5]. In the second case, less than half the labour time is necessary to produce a [surplus] value of [£] 1 as compared with the first case. Now, does this mean that in the second case the worker produces [£] 1 V15 for himself in half a working day, while in the first case he produced only [£] 1 in double the time, [and] that [now] he is therefore well on the way to becoming a capitalist? He would first have to acquire a capital of £16,000 and purchase alien labour, instead of working himself, if this reduction in necessary labour time were to be of any help to him.

The reduction has in fact merely created an unbridgeable gap between his labour and the conditions for its employment. It has reduced the rate of necessary labour, and has thus made redundant more than 6 times as many workers in proportion to the first relation. These workers who have been thrown into the street can now console themselves with the thought that if they enjoyed the conditions required to enable them to work independently or rather to work as capitalists, they would themselves require fewer workers. In the first CASE, the entire capital necessary is £100, and the individual worker thus has just a chance of saving up this much and, if he is exceptionally lucky, of himself becoming a capitalist like capitalist A [the owner of the capital of £100]. The time worked by the worker is the same whether he is employed by A or B [the owner of £16,000], although the total number of working days required by each of them is essentially different. For every 6 workers required by the first capitalist, the second requires less than one. Therefore the remaining ones must work just as much and more surplus time.

The fact that capital requires fewer living working days at a given stage of production in which it has increased equally with the productive forces, means according to Carey that the worker requires fewer working days to appropriate capital — presumably with the working days of the workers who are not "occupied". Because the capitalist needs fewer workers in order to valorise his immense capital, the worker he employs can appropriate more capital with less labour. SUCH is THE LOGIC OF MR. CAREY, THE HARMONISER.^

With respect to Ricardo's theory, Wakefield (Notebook VII, p. 74), I.e., [Vol. I, London, 1835,] p. [230-] 231, note, observes:

"TREATING LABOUR AS A COMMODITY, AND CAPITAL, THE PRODUCE OF LABOUR, AS ANOTHER, THEN, IF THE VALUE OF THESE 2 COMMODITIES WERE REGULATED BY EQUAL QUANTITIES OF LABOUR, A GIVEN AMOUNT OF LABOUR WOULD, UNDER ALL CIRCUMSTANCES, EXCHANGE FOR THAT QUANTITY OF CAPITAL WHICH HAD BEEN PRODUCED BY THE SAME AMOUNT OF LABOUR; ANTECEDENT LABOUR WOULD ALWAYS EXCHANGE FOR THE SAME AMOUNT AS PRESENT LABOUR. BUT THE VALUE OF LABOUR, IN RELATION TO OTHER COMMODITIES, IN SO FAR, AT LEAST, AS WAGES DEPEND UPON SHARE, IS DETERMINED, NOT BY EQUAL QUANTITIES OF LABOUR, BUT BY THE PROPORTION BETWEEN SUPPLY AND DEMAND." 1 4 8

^Bailey, Money and Its Vicissitudes in Value etc., London, 1837, (Notebook V, p. 26 ff), observes that DORMANT CAPITAL may be activised by means of accelerated circulation (in his view, by means of an increase in the volume of CURRENCY; he should have said, of money), and seeks to demonstrate that, in general, if a country's capital were always fully employed, no INCREASE OF DEMAND could bring forth AN INCREASE OF PRODUCTION. The concept of DORMANT CAPITAL belongs to the sphere of circulation, since capital which is not in circulation is dormant. The relevant passages are:

"Much CAPITAL and PRODUCTIVE SKILL MAY EXIST IN AN INERT STATE. It is incorrect when the economists believe THAT THE NUMBER OF LABOURERS and the QUANTITY OF CAPITAL a r e CERTAIN DEFINITIVE POWERS w h i c h m u s t INEVITABLY PRODUCE

A DETERMINATE RESULT IN ANY COUNTRY WHERE THEY EXIST" ( p . 5 4 ) . " Far FROM BEING FIXED AND DETERMINED, THE AMOUNT OF COMMODITIES w h i c h t h e EXISTING PRODUCERS and the EXISTING CAPITAL BRING TO MARKET, IS SUBJECT TO A WIDE RANGE OF VARIATION" (p. 55). Therefore, it is "NOT ESSENTIAL TO AN INCREASE OF PRODUCTION THAT NEW CAPITAL OR NEW LABOURERS SHOULD ARISE"... (E.g. in a country where WANT OF PRECIOUS METALS) "some commodities or, what is the same thing, the POWER TO PRODUCE THEM, may at one place be in excess, OTHER COMMODITIES AT ANOTHER PLACE likewise, and the HOLDERS OF EACH WISHING TO EXCHANGE THEIR ARTICLES FOR THOSE HELD BY THE OTHER, BUT KEPT IN A STATE OF NON-INTERCOURSE FOR WANT OF A COMMON MEDIUM OF EXCHANGE, AND IN A STATE OF INACTION BECAUSE THEY HAVE NO MOTIVE FOR PRODUCTION" (pp. 55, 56).

In the circulation of capital, money makes a dual appearance. [Firstly,] as the transformation of capital into money and realisation of the price of the commodity; but in this case, the positing of price is not a formal one. The transformation of the product into money is here the reconversion of capital into value as such, value existing independently; capital as money or money as realised capital. Secondly, in its determination as mere means of circulation. Here it only serves to reconvert capital into the conditions of production. In this second moment, in the form of wages, a certain volume of money must be simultaneously present as means of circulation, means of payment. The fact that money now plays this dual role in the circulation of capital, makes it appear in all crises that there is a lack of money as means of circulation; whereas actually capital is lacking in value, and thus cannot monétiser itself. In such a crisis the volume of money in circulation may in fact increase. The new determinations of money; how it is posited as a moment of the circulation of capital, partly as its means of circulation and partly as the realised value of capital, as itself capital, will require a section of its own when we discuss interest, etc.

Bailey continues:

"The labour set in motion is not at all solely dependent upon the AVAILABLE CAPITAL of a country. It depends upon whether FOOD, TOOLS and RAW MATERIALS are distributed slowly or rapidly [VI-9] TO THOSE PARTS WHERE IT is WANTED; whether it circulates with difficulty or not, whether it EXISTS FOR LONG INTERVALS IN INERT MASSES, and so as a result DOES NOT FURNISH SUFFICIENT EMPLOYMENT TO THE POPULATION" (pp. 56, 57).

(The example of Gallatin, I.e., p. 68,^[149] of the WESTERN COUNTIES of Pennsylvania.)

"Political economists are too apt to consider a certain quantity of capital and a certain number of labourers as instruments of production of UNIFORM POWER, or

V.18* OPERATING WITH A CERTAIN UNIFORM INTENSITY... The producer, who employs a certain capital, can have his products ON HAND for a long or a short time, and while he waits for the opportunity to exchange them, His POWER OF PRODUCING is STOPPED OR RETARDED, so that in a given period, for instance one year, HE MAY PRODUCE only half as much as if a PROMPT DEMAND had existed. This REMARK is EQUALLY applicable to the LABOURER, who is his instrument. The ADJUSTMENT OF THE VARIOUS OCCUPATIONS OF MEN IN SOCIETY TO EACH OTHER must be at least IMPERFECTLY EFFECTED. But if there is A WIDE DISTANCE between the stages in which [it] is effected — every EXPEDIENT which FACILITATES TRAFFIC is a STEP towards this ADJUSTMENT. T H E MORE UNIMPEDED and EASY the INTERCHANGE OF COMMODITIES BECOMES, the SHORTER WILL BE THOSE UNPRODUCTIVE INTERVALS in which MEN, EAGER FOR WORK, SEEM SEPARATED BY AN IMPASSABLE BARRIER FROM T H E CAPITAL ... which, although CLOSE AT HAND, is tied u p IN BARREN INERTNESS" (pp. 58-60).

" T h e general PRINCIPLE [is] T H A T A NEW DEMAND WILL BE MET BY FRESH EXERTIONS; BY T H E ACTIVE EMPLOYMENT O F CAPITAL AND LABOUR BEFORE DORMANT, AND N O T BY THE DIVERSION OF PRODUCTIVE POWER FROM OTHER OBJECTS. T h e latter is only possible if the employment of capital a n d labour in a country were n o longer capable of growth. T h e exportation OF T H E GOODS perhaps does not set new labour in motion directly, but then it absorbs [them], if already existing goods [are] DEAD STOCK a n d SETS AT LIBERTY CAPITAL TIED UP IN AN UNPRODUCTIVE STATE" (p. 65). "Those who maintain that an influx of money cannot promote the production of other commodities, since those commodities ARE T H E SOLE AGENTS OF PRODUCTION, prove that production could never be ENLARGED, for such an ENLARGEMENT requires T H A T FOOD, RAW MATERIALS, AND TOOLS SHOULD BE PREVIOUSLY AUGMENTED; WHICH IS IN FACT MAINTAINING THAT NO INCREASE OF PRODUCTION CAN TAKE PLACE WITHOUT A PREVIOUS INCREASE" (but is that not the economic doctrine of accumulation?) "or in other words, that AN INCREASE IS IMPOSSIBLE" (p. 70).

"Now, it is said that if the purchaser goes to MARKET with an augmented QUANTITY OF MONEY a n d does not raise the price of the commodity which he finds there, he does not give any ADDITIONAL ENCOURAGEMENT T O PRODUCTION: [but] if h e raises the price, if PRICES ARE PROPORTIONALLY ENHANCED, T H E PURCHASERS HAVE N O GREATER POWER OF DEMAND T H A N BEFORE" (p. 73). "It must be denied AS A GENERAL PRINCIPLE that A PURCHASER CANNOT GIVE ADDITIONAL ENCOURAGEMENT TO PRODUCTION, UNLESS HIS DEMAND RAISE PRICES. Apart from the circumstance that the preparation OF A LARGER QUANTITY ADMITS OF A MORE EFFECTIVE DIVISION OF LABOUR AND THE EMPLOYMENT OF SUPERIOR MACHINERY, THERE IS IN THIS MATTER THAT SORT OF LATITUDE, ARISING FROM A QUANTITY OF LABOUR AND CAPITAL LYING UNEMPLOYED, AND READY TO FURNISH ADDITIONAL COMMODITIES AT THE SAME RATE. S o it h a p p e n s t h a t A CONSIDERABLE INCREASE OF DEMAND often TAKES PLACE w i t h o u t RAISING PRICES" ( p p . 7 3 - 7 4 ) . ^ /

^ J o h n Wade, History of the Middle and Working Classes, etc., 3rd ed., London, 1835, (Notebook, p. 20 ^{[1 5 0]}):

"LABOUR IS THE AGENCY BY WHICH CAPITAL IS MADE PRODUCTIVE OF WAGES, PROFIT, OR REVENUE" (P. 161). "CAPITAL IS STORED UP INDUSTRY, PROVIDED TO DEVELOP ITSELF IN NEW AND EQUIVALENT FORMS; IT IS COLLECTIVE FORCE" ( p . 162). " C a p i t a l is b u t another name for civilisation" (p. 164).

The association of workers — cooperation and DIVISION OF LABOUR as basic conditions of the productivity of labour — appear, like all productive forces of labour, i.e. those which determine the degree of its intensity and hence of its extensive realisation, as a productive force of capital. T h e collective power of labour, its character as social labour, is therefore the collective power of capital. Likewise science and the division of labour, which appeaa as the division of EMPLOYMENTS and the exchange corresponding u; them. All social powers of production are productive forces < f capital and consequently capital itself appears as their subjeci.

Hence the association of the workers as it appears in the faciei is not posited by them but by capital. Their combination is u< their being, but rather the being of capital. To the hidnid'a worker it appears fortuitous. He relates to his own association \,ii;. other workers and to his cooperation with them as alien, as L modes of operation of capital. Where capital does not appear hi a inadequate form — say, in that of small-scale self-employed capital — it already implies [at quite an early stage] a certain, gieatei -, smaller, degree of concentration, both in objective form, i.e. ;a ta concentration in the hands of one person, which here si a coincides with the accumulation, of means of subsistence, taw material and instruments; or, in a word, the concentration • money as the general form of wealth, and also in subjective fonu, as the accumulation of the forces of labour and their concent a tion in one place under the command of capital. In this situaiù;a there is not one capitalist to one worker, but a number of wot'a- :. to one capitalist, not like the one or two journeymen who work k.>. one master.

Productive capital, or the mode of production corresponding t«; capital, can only take two forms: manufacture or large-scale industry. In the former, the division of labour prevails; in the latter, the combination of the forces of labour (with a unilen a; mode of labour) and the application of scientific POWER, where «'a combination and, as it were, the communal spirit of labour is transferred to the machine, etc. In the first form, the number a workers (accumulated) must be large in proportion to the .,.: r ,

OF CAPITAL; in the second, fixed capital is large in pi open lion to tha many associated workers. But the concentration of many work,.-; s and their allocation among the machinery as so many cogs (why ai agriculture it is different, irrelevant here) is heie aha.wv. presupposed. Therefore we do not have to consider < ASI 11 lu . any detail, but only CASE I.

The characteristic development of manufacture is th< rii aa.-, ( labour. But this presupposes that a large number ol uo-1 • , a been (previously) assembled under one command, in ju<i di; *• way as the transformation of money into capital presuppmrs /»."•' certain AMOUNT of means of subsistence, raw materials and inst)m > > labour has been set free. Here we must also abstract from iL ;';. of labour as a later development. Certain branches «•< \••• ..

18-852 e.g. mining, presuppose cooperation right from the start. As long as capital does not exist, cooperation takes place through forced labour (serf or slave labour) under an overseer. Likewise the construction of roads, etc. To undertake such activities, capital does not produce the accumulation and concentration of workers, it takes them over. This aspect is therefore not IN QUESTION.

The simplest form, and the one most independent of the division of labour, is that in which capital employs a number of hand-weavers, spinners, etc., independent of and living separately from one another. (This form still exists alongside industry.) Therefore, at this stage, the mode of production itself is not yet determined by capital, but is found by it already in existence. The unifying focus of these scattered workers is solely their mutual relation to capital, the fact that their product, and hence the surplus values they produce over and above their own income, are accumulated in the hands of capital. As associated labour, they exist only in themselves, in so far as each of them works for capital and thus possesses a centre in it, without really working together. Their association by capital is thus merely formal, [VI-10] and concerns only the product of labour, not labour itself. Instead of exchanging with many, they exchange with the one capitalist. Capital therefore effects a concentration of EXCHANGES.

Capital does not exchange as an individual, but as representing the consumption and the needs of many. It no longer exchanges as individual exchanger, but in the act of exchange represents the whole society. Collective exchange and concentrating exchange on the side of capital with individually working weavers, etc., the products of whose labour are collected and brought together by this exchange, and thus their labour is brought together, too, although they act independently of one another. The combination of their labour appears as a particular act, alongside which the independent fragmentation of their labour continues. This is the first prerequisite for money to exchange as capital with free labour.

The second prerequisite is the transcendence of the independent fragmentation of the many workers, in such a way that the single capital no longer appears relative to them merely as social collective power in the act of exchange, combining many exchanges in capital, but assembles them in one place under its command, in one place of work, no longer letting them continue in the previously existing mode of production and establishing its power on that basis, but rather creating as basis a mode of production corresponding to itself. It posits the combination of the workers in production, a combination which at first will be confined to a common place of work under the direction of overseers, regimentation, greater discipline, consistency, and a p o s i t e d dependence on capital in production itself. With this development certain faux frais de production"" are saved right away. (On this whole process, cf.

Gaskell, which is specially concerned with the development of large-scale industry in England.⁽⁹⁾)

Capital now appears both as the collective power of the workers, their social power, and as the unity which binds them together and thereby creates this power. Now as before, and at every stage of the development of capital, all this is mediated by the many exchanging with it as the one, so that the exchange itself is concentrated in capital. This is the social character of the exchange: capital exchanges socially with the workers, but they exchange individually with it.

With handicraft production, it is the quality of the product which matters, the particular skill of the individual labourer, and the master as master is SUPPOSED to have achieved mastery in this skill. His position as master rests not only on his ownership of the conditions of production, but also on his own skill in the particular trade. With production based on capital, right from the start it is not this half-artistic relationship which matters — a relationship which altogether corresponds [more] to the development of the use value of labour, to the development of the particular skill of immediate manual labour, to training the human hand, etc., for labour. Right from the start, capitalist production is concerned with quantity, because it is concerned with exchange value and surplus value. The developed principle of capital is precisely to render superfluous any particular skill, to render superfluous manual labour, immediate physical labour in general, both as a specialised skill and as muscular exertion, to locate all skill rather in the inanimate forces of nature.

Now, with the presupposition of the rise of manufacture as the emergence of the mode of production of capital (slaves are combined in themselves because they are under the direction of one master), it is presupposed that the productive power of labour to be called forth only by capital itself does not as yet exist. Hence it is presupposed that, in manufacture, necessary labour still claims a great part of all available labour time, which means that the surplus labour which can be performed by the individual worker is still relatively small.

Now, this is compensated for and the progress of manufacture is accelerated by the fact that the rate of profit is larger, and hence capital is accumulated more rapidly relative to the AMOUNT of it already in existence than in large-scale industry. If 50 thaler of [an advanced capital of] 100 thaler is paid to labour, and surplus time='/5 [of necessary time], the value created is 110, or [the rate of profit is] 10%. If only 20 thaler of [a capital of] 100 thaler is paid to labour, and surplus time='/4 [of necessary time], the value created =105, or [the rate of profit is] 5%.

On the other hand, this greater rate of profit in manufacture can only be achieved by the simultaneous employment of many workers. The greater surplus time can only be obtained by the collection of the surplus time of many workers for the benefit of capital. Absolute, not relative, surplus time predominates in manufacture. This is even more the case originally, if the scattered independent workers still make use of part of their surplus time for themselves. For capital to exist as capital, for it to be able both to live on its profit and to accumulate, its profit must=the sum of the surplus time of many simultaneous living working days. In agriculture, the soil itself, in its chemical, etc., activity, is already a machine which makes immediate labour more productive, and it yields a surplus earlier, because it is the first productive activity carried on with a machine, namely a natural one. This is the only correct basis of the Physiocratic doctrine, which considers agriculture from this angle in relation to as yet very undeveloped manufacture. If the capitalist employed one worker in order to live on the surplus time worked by that worker, then it appears that he would double his profit if [instead] he worked himself and with his own funds. For apart from the surplus time, he would gain the wages paid to the worker. In fact, he would lose in the process. For either he would not yet be in the CONDITIONS enabling him to work as a capitalist, or the worker would merely be his assistant and would not yet relate to him as capitalist.

For money to be transformed into capital, it is therefore not only necessary that it should be able to set surplus labour in motion, but that it should be able to set in motion a certain quantity of surplus labour, the surplus labour of a certain quantity of necessary labour, i.e. of many workers at the same time. The combined sum must suffice for capital both to live as capital, i.e. to represent, in consumption, wealth as against the fife of the worker, and to put aside surplus labour for accumulation. Right from the start, capital does not produce for use value, for immediate subsistence. Hence right from the start, surplus labour must be sufficiently large for a part of it to be reinvested as capital. Thus, whenever the stage is reached at which a certain quantity of social wealth is already concentrated in one hand, in an objective form, wealth which therefore as capital immediately appears as exchange with many workers and later as production by many workers, by a combination of workers, and can SIMULTANEOUSLY set TO WORK a certain quantity of living labour capacity,—when this stage is reached, production by capital begins. Right from the start, capital appears as a collective power, as a social power and as the transcendence of individual isolation, first of the exchange with the workers, and then of the workers themselves. The isolation of the workers still implies their relative independence. Complete dependence on capital, complete separation of the workers from the conditions of production, consequently imply their grouping around the individual capital as the sole source of their subsistence.

The result will be the same — or it is the same in another form — if we set out from the particular form of exchange which is presupposed for capital to exchange as capital, where money must already represent many exchangers or possess a power of exchange going beyond the scope of the individual and his individual surplus; no longer an individual power of exchange, but one which, though it belongs to the Individual, belongs to him as a Social function and by virtue of his exchanging as the representative- of the wealth of society. All this also arises from the conditions of free labour. The separation of the individual from the production conditions of labour=the assembly of many around the one capital.^

^Merchant capital also right from the start the concentration of many exchanges in one hand. It already represents a mass of exchangers both as M and as C.^

[VI-ll] "This continual progression of knowledge and experience is our great strength," writes Babbage.⁽¹⁰⁾

This progression, this social progress, belongs to and is exploited by capital. All previous forms of property condemn the greater part of mankind, the slaves, to be mere instruments of labour. Historical development, political development, art, science, etc., are located in the higher spheres above them. But it is only capital which has subjected historical progress to the service of wealth.

^Prior to the accumulation by capital, an accumulation is presupposed which constitutes capital and which belongs to its concept. We cannot really call it concentration yet, because this occurs in contradistinction to many capitals. But if one still speaks of the capital, concentration still coincides with accumulation or the concept of capital. In other words, concentration does not yet constitute a particular determination. But right from the start, capital does indeed exist as One or Unity, confronting the workers as Many. It thus appears as the concentration of the workers which confronts labour, [that is to say] as a unity located outside them. From this aspect, concentration is contained in the concept of capital — the concentration of many living labour capacities for a particular purpose; a concentration which initially need not by any means have been fully effected in the mode of production itself, or have permeated it. The centralising effect of capital upon labour capacities, or the positing of itself as their unity which exists independently of and outside their multiplicity.^.

^ I n his Leçons d'économie politique* (Notebook, p. 26), Rossi writes:

"Social progress cannot consist in the dissolution of all association, but in replacing the compulsory, oppressive associations of the past by voluntary and just ones... The most extreme form of isolation is the savage state; the most extreme form of compulsory and oppressive association is barbarism. Outside these extremes, history shows us many different varieties and nuances. Perfection is found in voluntary associations which multiply strength through union, without stripping individual power of its energy, morality or responsibility" (p. 353).⁽¹¹⁾

Under capital, the association of the ouvriers⁽¹²⁾ is not enforced through direct physical force, compulsory, serf and slave labour; it is enforced by the circumstance that the conditions of production are alien property and are themselves present as objective association, which is the same as accumulation and concentration of the conditions of production.^

^"The economists are led into all manner of DIFFICULTIES by their way of conceiving capital purely in its physical aspect, as instrument of production, and ignoring the economic form, which is what makes the instrument of production capital. For instance, Rossi asks (Notebook, 27):

"Is the raw material really an instrument of production? Is it not rather an object which is acted upon by the instrument of production?" (p. 367).⁽¹³⁾

In this passage, Rossi merges capital completely with the instrument of production in the technological sense, and on this basis every savage is a capitalist (which Mr. Torrens in fact asserts with respect to a savage who aims a stone at a bird.⁽¹⁴⁾) Moreover, even from the aspect of the purely physical abstraction — i.e. the abstraction from the economic category itself — Rossi's remark is a shallow one, and only shows that he has not understood his English teacher [Torrens].

ACCUMULATED LABOUR USED AS INSTRUMENT FOR NEW PRODUCTION, o r PRODUCE pure and simple APPLIED TO PRODUCTION⁽¹⁵⁾; the raw material is applied to production, i.e. subjected to an alteration of form, just as much as the instrument, which is also produit. The finished result of production becomes in turn a moment of the process of production. That is all the statement means. Within the process of production it can figure as raw material or as instrument. But it is an instrument of production, not in so far as it serves as an instrument in the direct process of production, but in so far as it is a means for the renewal of the process of production itself — one of its presuppositions.

More important and more TO THE POINT, is the question whether or not the means of subsistence, i.e. wages, are part of capital, and here the whole confusion of the economists becomes evident.

"One says the remuneration of the worker is capital, because the capitalist advances it to him. If only there were families of workers who had sufficient to subsist for a year, wages would not exist. The worker could say to the capitalist: you advance the capital for the common project, I will bring the labour to it; the product will be shared among us in such and such proportions. As soon as the product has been realised, each of us will take his share" [Rossi,] (p. 369[-370]). "Then there would be no advances for the workers. Even if work were at a standstill, they would still consume. What they would [in that case] consume belongs to the consumption fund, not at all to capital. Therefore: the advances for the workers are not necessary. Therefore wages are not a constituent element of production. They are of an accidental nature, a form arising from our social condition. Capital, labour and land, on the other hand, are necessary for production. Secondly: The word 'wages' is employed in a double sense: one says that wages are a capital, but what do they represent? Labour. He who says wages says labour and vice versa. Hence, if the wages advanced constituted a part of capital, one would have to speak only of two instruments of production: capital and land" (p. 370).⁽¹⁶⁾ -'•••id furthei :

'P'isirally, the icoiker does not consume the capitalist's possessions, but his own; what is : .j to him as remuneration for his labour is his own fractional part of the product" i --. 370). "The capitalist's contract with the worker is not one of the phenomena of

taction,.. The entrepreneur goes along with this arrangement in so far as it may •_ iiitate production. But this is nothing but a second operation, an operation of a •ne different nature, grafted on to a productive operation. It could disappear if '•-.nr were organised differently. Even today there are spheres of production in which ' h is no place. Wages are therefore a form of the distribution of wealth, not an

! nient of production. The pari of the fund which the entrepreneur devotes to

•••-. payment of wages does not constitute a part of capital... It is a distinct ration, which undoubtedly may promote the course of production but which root be called a direct instrument of production" (p. 370).a

To conceive the power of labour, while ignoring the worker's means of • ' i'stence during the work of production, is to conceive an imagined being. He n says labour or the power of labour says worker and means of subsistence, •ri er and wage... The same element reappears under the name of capital; as if the same •' '"^ could simultaneously form part of tivo distinct instruments of production" (pp. 370,

i here is much confusion here, justified only by Rossi taking the . miomisls at their word and equating the instrument of production - such with capital. D'abord, he is quite right in arguing that wage ': hour is not an absolute form of labour. But he forgets that

; pital is just as little an absolute form of the means and materials -:4 labour, that these two forms [wage labour and capital] are the si me form in different moments, and therefore stand and fall

;cther. Hence if is absurd of him to speak of capitalists without ^\]ge labour.

Mis example of families of workers who can subsist for a year v.-fthout the capitalist, who therefore own the conditions of their production, and who perform their necessary labour without the amission of Mr. Capitalist, reduces the capitalist whom he lets •••aie to them with his PROPOSAL to a producer of instruments of production. The coming to them is nothing but a division of : diour mediated by exchange with the outside. Even without any ri rangement — by means of simple EXCHANGES — the two share in the cunmon product. The EXCHANGE is the sharing-out; no further T rangement is necessary. What these families of workers would be exchanging would be the absolute or relative surplus labour which Me instrument would have enabled them to perform — either new ^[1] -'hour carried on as a sideline over and above the old labour on Inch they were able to live from year to year before the appearance of the capitalist, or [extra labour made possible] by the employment of this instrument in their traditional branch of work. Here Mr. Rossi transforms the worker into the owner and exchanger of his [VI-12] surplus labour, and in this way he has succeeded in removing from him the last vestige of what stamps him as a wage worker; but he has also thereby removed from the instrument of production the last vestige of what makes it capital.

It is true that the worker "basically does not consume the capitalist's possessions, but his own", however not exactly as Mr. Rossi thinks, because it is only a fractional part of the product, but because it is a fractional part of his product. If the semblance of exchange is stripped away, the payment consists in the fact that the worker works one part of the day for himself and another for the capitalist, but only gets the permission to work at all as long as his labour permits this division. As we have seen, the act of exchange itself is not a moment of the immediate process of production but one of its conditions. Yet within the total process of production of capital, which includes in itself the different moments of its EXCHANGES, i.e. circulation, this exchange is posited as a moment of the total process.

But, says Rossi, wages appear twice in the calculation: once as capital, the other time as labour. Hence wages represent two distinct instruments of production; and if they represent the instrument of production "labour", they cannot represent the instrument of production "capital". There is a confusion here which is likewise due to the fact that he takes the orthodox economic distinctions seriously. In production, wages figure only once, as the fund destined to be converted into wages, as virtual wages. As soon as they become real wages, they are paid out and now only figure in consumption as the income of the worker. What is exchanged for wages is labour capacity, and this does not figure in production at all, only the use made of it— labour. Labour appears as an instrument of production of value, because it is not paid for and hence is not represented by wages. As an activity producing use value, it has also nothing to do with itself as paid labour. Wages in the hands of the worker are no longer wages, but a consumption fund. Only in the hands of the capitalist are they wages, i.e. the part of capital destined to be exchanged for labour capacity. For the capitalist they have reproduced a saleable labour capacity, so that from this aspect even the consumption of the workers serves the interest of the capitalist. He does not pay anything at all for the labour itself, only for the labour capacity. What enables him to do this is of course precisely the efficacy of this capacity.

The double appearance of wages is not due to the fact that they represent on two occasions two different instruments of production, but to the fact that they appear at one time under the aspect of production and at another under that of distribution. Yet this particular form of distribution is not any sort of arrangement that can be altered at one's own discretion. It is posited by the form of production itself; it is merely one of production's own moments considered in another determination.

The value of the machine certainly constitutes a part of capital, which is laid out in that form; but the machine as value does not produce anything, although it makes a profit for the factory-owner. Wages do not represent labour as an instrument of production, as little as value represents the machine as an instrument of production. They merely represent labour capacity, and, since the value of that capacity exists separately from it as capital, they are part of capital.

In as much as the capitalist appropriates alien labour and with this appropriated labour purchases more labour, wages — i.e. the representative of labour — appear in a dual form, if Mr. Rossi wishes, (1) as the property of capital, (2) as representative of labour. What really worries Rossi is that wages appear as the representative of two instruments of production, of capital and of labour. He forgets that labour as a productive force is embodied in capital and that as labour in esse,⁽¹⁷⁾ not labour in posse,⁽¹⁸⁾ it is in no way an instrument of production distinct from capital, but that, on the contrary, it is only labour which converts capital into an instrument of production. As for the distinction between wages as constituting part of capital and as simultaneously the income of the worker, we shall discuss that in the section on profit, interest, with which we conclude this first chapter on capital.^

y^Malthus returns to the points made in the above-mentioned The Measure of Value etc. in his Definitions in Political Economy, etc., London, 1827. In that book he says:

" N O WRITER THAT I HAVE MET WITH, ANTERIOR TO MR. RICARDO, EVER USED THE TERM WAGES, OR REAL WAGES, AS IMPLYING PROPORTIONS. PROFITS, INDEED, IMPLY PROPORTIONS; AND THE RATE OF PROFITS HAD ALWAYS JUSTLY BEEN ESTIMATED BY A PERCENTAGE UPON THE VALUE OF THE ADVANCES. B U T WAGES HAD UNIFORMLY BEEN CONSIDERED AS RISING OR FALLING, NOT ACCORDING TO ANY PROPORTION WHICH THEY MIGHT BEAR T O THE WHOLE PRODUCE OBTAINED BY A CERTAIN QUANTITY OF LABOUR,

BUT BY THE GREATER OR SMALLER QUANTITY OF ANY PARTICULAR PRODUCE RECEIVED BY

THE LABOURER, OR BY THE GREATER OR SMALLER POWER WHICH SUCH PRODUCE WOULD

CARRY OF COMMANDING THE NECESSARIES AND CONVENIENCES OF LIFE" ( M [ althus , p p . ] 29, 30) (Notebook X, p. 49).

The sole value produced in a given production by capital, is the value added by the new quantity of labour. But this value consists of necessary labour which reproduces wages — the advances made by capital in the form of wages—, and of surplus labour, hence surplus value over and above necessary labour. The advances made in the form of material and machinery are only translated from one form into another. The instrument passes over into the product just as much as does the raw material, and its wearing out at the same time posits the form on the product. If the raw material and instrument cost nothing, as in the case of some extractive industries, where they are still almost=0 (the raw material always in each extractive industry, metal-mining, coal-mining, fishing, hunting, timber-cutting in primeval forests, etc.), they add absolutely nothing to the value of production. Their value is the result of previous production, not of the immediate production in which they serve as instrument and material. Surplus value can therefore only be estimated in relation to necessary labour. Profit is merely a secondary, derived and transformed form of surplus value, the bourgeois form in which the traces of its origin are wiped out.

Ricardo himself never understood this, (1) because he always speaks merely of the division of a finished quantity, never of the original positing of this distinction [between profit and wages]; (2) because an understanding of this distinction would have forced him to realise that the relation established between capital and labour differs entirely from that of exchange, and he dared not realise that the bourgeois system of equivalents turns into and is based on appropriation without an equivalent; (3) because his doctrine of PROPORTIONATE PROFITS and WAGES merely expresses the fact that, [if] a certain total value is divided into two parts, or if any quantity is divided into two parts, the size of the two parts is necessarily inversely related. And indeed his school subsequently reduced the matter to this commonplace.

Ricardo's purpose in putting forward the doctrine of PROPORTION-

ATE WAGES and PROFITS was not to discover the basis of the creation of surplus value — for he starts from the assumption that a given value must be divided between wages and profit, between labour and capital, and hence implies that this division is self-evident. His purpose was, rather, firstly, to assert the correct method of price determination, which he bases on value, as against the current one by showing that the limit of value itself is not affected by its distribution in various proportions between PROFITS and WAGES; secondly, to explain the reason for not only the transitory but the continuous fall in the rate of profit, which was inexplicable to him on the basis of the assumption that a fixed portion of value accrues to labour; thirdly, by explaining this fall of profits by the rise of wages, to explain this rise itself by a rise in the value of agricultural products, i.e. by the increasing difficulty of producing them, and thus at the same time to explain ground rent as not at variance with his value principle.

This also provided a polemical weapon for industrial capital against landed property, which was exploiting the progress made by industry. But at the same time, impelled by simple logic, he had thus proclaimed the contradictory nature of profit, labour and capital, [VI-13] however much he exerted himself subsequently to prove to the worker that the contradiction between profit and wages did not affect his real income, that, on the contrary, a proportional (not absolute) rise of wages is undesirable, because it impedes accumulation, and because the development of industry then benefits only the idle landowner. STILL, the contradiction was proclaimed, and Carey, who does not understand Ricardo, could therefore denounce him as the father of the communists, etc.,⁽¹⁹⁾

and in a sense he is right, though he does not himself understand in what sense.

The other economists, however, who, like Malthus, want to have absolutely nothing to do with the proportional (and hence contradictory) nature of wages, desire on the one hand to obscure the contradiction, but on the other cling to the proposition that the worker simply exchanges a certain use value, his labour capacity, for capital, and thus renounces labour's productive power, the power of producing new value, that the worker has nothing to do with the product, and that consequently the exchange between capitalists and workers, wages, just like every simple EXCHANGE where economic equivalents are presupposed, is concerned only with quantity, the quantity of use value.

However correct this may be in a sense, the apparent form of BARTER and EXCHANGE prompts the worker, when competition allows him to bargain and haggle with the capitalist, to measure his claims by reference to the capitalist's profit, and to demand a certain share in the surplus value he has produced; so that the proportion becomes a real moment of economic life itself. Furthermore, in the struggle between the two classes — which necessarily arises with the development of the working class — the measure of the reciprocal distance between them, which is expressed precisely by wages as a proportion, becomes decisively important. The semblance of exchange disappears in the process of the mode of production based on capital. The process itself and its repetition now posits what is the case in itself, namely that the worker receives in his wages from the capitalist only a part of his own labour. Eventually this enters the consciousness of both the workers and the capitalists.

Actually, the only question in Ricardo is: what proportion of the total value do necessary wages constitute in the course of development? It always remains only the necessary wages; their proportional nature is therefore of no concern to the worker, who now as before receives the same minimum, but only to the capitalist, whose deductions from his net income vary without the workers receiving any more in terms of use value. But the fact that Ricardo formulated the contradictory nature of profit and wages, even if he was seeking to deal with quite different problems, in itself shows that in his time the mode of production based on capital had taken on a form increasingly adequate to its nature.

In the Definitions referred to (Notebook IX, pp. 49, 50), Malthus comments with regard to Ricardo's theory of value:

"Ricardo's assertion, that as the VALUE OF WAGES RISES PROFITS PROPORTIONALLY FALL and vice versa, can be true only on the assumption that commodities in which the same quantity of labour has been worked up are always of the same value, and this will be found to be true in one case out of five hundred; and necessarily so because the progress of civilisation and IMPROVEMENT continually increases the QUANTITY OF FIXED CAPITAL EMPLOYED and renders more VARIOUS AND UNEQUAL the TIMES OF THE RETURNS OF THE CIRCULATING CAPITAL" (I.e., pp. 31, 32).

(This relates to prices, not value.) • With respect to HIS OWN DISCOVERY OF THE TRUE STANDARD OF VALUE, Malthus remarks:

COSTS OF PRODUCING THE WAGES OF A GIVEN QUANTITY OF LABOUR MUST ALWAYS NECESSARILY BE THE SAME" ( p p . 1 9 6 , 1 9 7 ) .

This only means that WAGES are always equal to the labour time necessary for their production, which varies with the productivity of labour. The QUANTITY OF COMMODITIES remains the same.

"If VALUE is regarded as a commodity's GENERAL POWER OF PURCHASE, this must refer to the purchase of all commodities, the GENERAL MASS OF COMMODITIES. But this mass is quite UNMANAGEABLE. NOW, OF ANY ONE OBJECT, IT CANNOT FOR A MOMENT BE DENIED THAT LABOUR BEST REPRESENTS AN AVERAGE OF THE GENERAL MASS OF PRODUCTIONS" (p. 205). "A LARGE CLASS OF COMMODITIES, such as RAW PRODUCE, rises in the PROGRESS OF SOCIETY as compared with labour, while MANUFACTURED ARTICLES FALL. SO it is not FAR FROM THE TRUTH TO SAY that the AVERAGE MASS of commodities which A GIVEN QUANTITY OF LABOUR WILL COMMAND IN THE SAME COUNTRY, DURING THE COURSE OF SOME CENTURIES, MAY NOT VERY ESSENTIALLY VARY" (p. 206). "VALUE should always be value in exchange for labour" (I.e., p. 224, note).

In other words, [Malthus's] doctrine is that the value of a commodity, the labour worked up in it, is represented by the [number of] living working days which it commands, for which it can exchange, and hence by WAGES. The living working days contain both [necessary] time and surplus time. Let us do Malthus the biggest possible favour. Let us assume that the proportion of surplus labour to necessary labour, and hence the proportion of WAGES to PROFIT, always remains constant. To begin with, the fact that Mr. Malthus speaks of the labour worked up in the commodity WITH THE ADDITION OF PROFITS, demonstrates his confusion, since profits can only constitute a part of the labour worked up. What he has in mind are the profits which are supposed to result from the fixed capital, etc., over and above the labour worked up. But this can only affect the distribution of total profit among the various SHAREHOLDERS in this capital, not its total quantity. For if everyone obtained for his commodity the labour worked up in it+pROFiTs, where do these profits come from, Mr. Malthus? If one obtains the labour worked up in his commodity+profit, another must obtain the labour worked up [in his commodity] — prof it. Profit is being considered here as greater than actual surplus value. Hence this drops out of the calculation.

Now suppose that the labour worked up = 3 working days. If the proportion of surplus [to total] labour time is 1:2, these have been obtained in payment for 1 72 working days. INDEED, the workers worked for 3 days, but each was paid only half a day [for a full day's labour]. Or the commodity which they received for their 3 working days had only 1 1/2 working days worked up in it. Hence, all other things being equal, the capitalist would obtain 6 working days for the 3 days worked up in his commodity. (This proposition is correct only because surplus labour time has been assumed as equal to necessary, so that in the second CASE only the first is repeated.)

(Obviously, relative surplus value is limited not only by the above ratio [between necessary and surplus time], but also by the proportion in which the product enters into the consumption of the worker. If the capitalist, through growth of the productive forces, could obtain double the number of cashmere SHAWLS and sell them at their value, he would not have created any relative surplus value, because the workers do not consume such SHAWLS, and the time necessary for the reproduction of their labour capacity would remain the same. In practice this would not be so, because in such cases the price rises above the value. But this does not yet concern us here in the theoretical section, for we are considering capital in itself, not in a particular branch.)

I.e. the capitalist will pay wages for 3 days and set the workers to work 6. With each half working day he buys a whole day; thus, with ^[6]/^[2] or 3 days, he buys 6 days. Therefore, to assert that the value of a commodity is expressed by the [number of] working days it commands, or the WAGES it pays, is to understand absolutely nothing about the nature of capital and wage labour. THE PITH of all value creation and capital formation is that objectified working days command a greater number of living working days. Mr. Malthus would have been correct, if he had argued that the living labour time which a commodity commands expresses the measure of its valorisation, the measure of the surplus labour which it posits. Yet this would only be the tautology that to the extent to which it posits more labour, it posits more labour, or it would express the opposite of what Malthus wants to say, namely that surplus value arises from the fact that the living labour time which a commodity commands never represents the labour time which is worked up in it.^ (Now WE HAVE FINALLY DONE WITH MALTHUS.)

[VI-14]^We have demonstrated above in the development of the concept of capital that it is value as such, i.e. money, which both maintains itself in circulation and grows through the exchange with living labour; that therefore the purpose of productive capital is never use value, but the general form of wealth as wealth. In a work which is otherwise in many ways silly and distasteful, On Political Economy in Connexion with the Moral State and Moral Prospects of Society, 2nd ed., London, 1832, the cleric Thomas Chalmers has correctly struck upon this point, and has done so without falling into the asininity of fellows such as Ferrier? etc., who confuse money as the value of capital with the metallic money actually available. In crises, capital (as commodity) cannot be exchanged, not because there are too few means of circulation; it does not circulate because it is not exchangeable. T h e significance which cash acquires in times of crisis arises only from the fact that, while capital is not exchangeable for its value — and only for that reason does its value appear to confront it fixed in the form of money — it still has obligations to pay. Alongside the interrupted circulation, a forced circulation takes place. Chalmers writes (Notebook IX, p. 57):

"WHEN A CONSUMER REFUSES CERTAIN COMMODITIES, it is not always, as it has been ASSUMED by the new economists, BECAUSE HE WANTS TO PURCHASE OTHERS IN PREFERENCE — but because he WANTS TO RESERVE ENTIRE THE GENERAL POWER OF PURCHASING. And WHEN A MERCHANT BRINGS COMMODITIES TO MARKET, IT IS GENERALLY NOT IN QUEST OF OTHER COMMODITIES TO BE GIVEN IN RETURN FOR THEM ... HE WILL EXTEND HIS GENERAL POWER OF PURCHASE OF ALL COMMODITIES It is no use saying that money, too, is a commodity. The REAL METALLIC MONEY FOR WHICH A

MERCHANT HAS ANY USE, DOES NOT AMOUNT TO MORE THAN A SMALL FRACTION OF HIS CAPITAL, EVEN OF HIS MONIED CAPITAL; ALL OF WHICH, THOUGH ESTIMATED IN MONEY,

CAN BE MADE, ON THE STRENGTH OF WRITTEN CONTRACTS, TO DESCRIBE ITS ORBIT, AND

BE EFFECTIVE FOR ALL ITS PURPOSES, WITH THE AID OF COIN AMOUNTING TO AN INSIGNIFICANT PROPORTION OF THE WHOLE. THE GREAT OBJECT OF THE MONIED CAPITALIST, IN FACT, IS TO ADD TO THE NOMINAL AMOUNT OF HIS FORTUNE. ÏT IS THAT,

IF EXPRESSED PECUNIARILY THIS YEAR BY £ 2 0 , 0 0 0 f o r e x a m p l e , IT SHOULD BE EXPRESSED PECUNIARILY NEXT YEAR BY £ 2 4 , 0 0 0 . TO ADVANCE HIS CAPITAL, AS ESTIMATED IN MONEY, IS THE ONLY WAY IN WHICH HE CAN ADVANCE HIS INTEREST AS A MERCHANT. The IMPORTANCE of this OBJECT to him is not affected by FLUCTUATIONS IN THE CURRENCY OR BY A CHANGE IN THE REAL VALUE OF MONEY. For instance, he may have advanced his fortune, by the business of one year, from £20,000 to £24,000, and yet, from a decline in the value of money, he may not HAVE INCREASED HIS COMMAND over the COMFORTS, etc. Still it was as much his interest [to have engaged in the business], as if money had not fallen; for else, his MONIED FORTUNE WOULD HAVE REMAINED STATIONARY, a n d h i s REAL WEALTH WOULD HAVE DECLINED IN THE PROPORTION OF 24 TO 20... COMMODITIES" (i.e. use value, real wealth) "are not the TERMINATING OBJECT of the TRADING CAPITALIST"

(the illusion of the monetary system^[58] lies in that it saw in REAL METALLIC MONEY (or paper money, for that matter), in short, in the form of value as real money, the general form of wealth and self-enrichment; while it is precisely as money increases as the accumulation of the GENERAL POWER OF PURCHASING that it declines relatively in its particular form as means of circulation or also as realised hoard. As assignation of REAL WEALTH or PRODUCTIVE POWER, it acquires a thousand forms)

a F. L. A. Ferrier, Du gouvernement considéré dans ses rapports avec le commerce.— Ed.

"save in the spending of his revenue in purchases for the SAKE OF CONSUMPTION. IN

THE OUTLAY OF HIS CAPITAL, AND WHEN HE PURCHASES FOR THE SAKE OF PRODUCTION, MONEY IS HIS TERMINATING OBJECT" ( N . B . not COIN) ( p p . 1 6 4 - 6 6 ) .

"PROFIT,'" says the same Chalmers, "HAS THE EFFECT OF ATTACHING THE SERVICES

OF THE DISPOSABLE POPULATION TO OTHER MASTERS, BESIDES THE MERE LANDED PROPRIETORS, WHILE their EXPENDITURE REACHES HIGHER THAN THE NECESSARIES OF LIFE" (p. [77-]78) (Notebook IX, p. 53)../

In the book from which we have just quoted, Chalmers calls the entire circulation process THE ECONOMIC CYCLE:

" T H E WORLD OF TRADE MAY BE CONCEIVED TO REVOLVE IN WHAT WE SHALL CALL AN ECONOMIC CYCLE, WHICH ACCOMPLISHES ONE REVOLUTION BY BUSINESS COMING ROUND AGAIN, THROUGH ITS SUCCESSIVE TRANSACTIONS, TO THE POINT FROM WHICH IT SET OUT. ITS COMMENCEMENT MAY BE DATED FROM THE POINT AT WHICH THE CAPITALIST HAS OBTAINED THOSE RETURNS BY WHICH HIS CAPITAL IS REPLACED TO HIM: WHENCE HE PROCEEDS ANEW TO ENGAGE HIS WORKMEN; TO DISTRIBUTE AMONG THEM, IN WAGES, THEIR MAINTENANCE, OR RATHER THE POWER OF LIFTING IT; TO OBTAIN FROM THEM, IN FINISHED WORK, THE ARTICLES IN WHICH HE SPECIALLY DEALS; TO BRING THESE ARTICLES TO MARKET, AND THERE TERMINATE THE ORBIT OF ONE SET OF MOVEMENTS, BY EFFECTING A SALE, AND RECEIVING IN ITS PROCEEDS A RETURN FOR THE WHOLE OUTLAYS OF THE CAPITAL. The intervention of money in no way changes the REAL character of this operation" (p. 85, I.e.) (Notebook IX, p. 54).

The difference in the RETURN [of different capitals], so far as it is dependent upon the phase of the circulation process which coincides with the immediate production process, depends not only on the longer or shorter labour time which is necessary for the completion of the object (e.g. canal construction, etc.), but in certain branches of industry — agriculture — also on the interruptions in labour which are inherent in the nature of the work itself, when either capital lies fallow, or labour is at a standstill. Thus the example given by A. Smith of wheat as a crop which takes a year to produce, and of oxen as one which takes five years.⁽²⁰⁾

Consequently, 5 years' labour is employed on the latter, but only 1 on the former.

Little labour is employed on e.g. cattle which grows up on the open pastures. On the other hand, in agriculture itself, little labour is employed e.g. during the winter. In agriculture (and to a greater or lesser degree in many other branches of production), there are certain interruptions, pauses in labour time, which arise from the conditions of the production process itself; work must be recommenced at a given point, to continue or to complete the process of production. Here the constancy of the production process does not coincide with the continuity of the labour process. This is one moment of the difference [in the return]. Secondly: [In some branches] the product altogether requires a longer time to be completed, to be put into its FINISHED STATE [than in others]. This is the total duration of the process of production, quite apart from whether or not there are interruptions in the operations of labour; the different duration of the phase of production in general. Thirdly: After the product is FINISHED, it may have to lie fallow for quite a long time, during which it requires relatively little labour, in order to let natural processes work upon it, e.g. wine. (Conceptually, this is approximately the same CASE as I.) Fourthly: It may take a longer time to bring the product to market, because it is destined for a more distant market. (This coincides conceptually with CASE II.) Fifthly: T h e shorter or longer time involved in the total RETURN of capital (its total reproduction), so far as it is determined by the ratio of fixed to circulating capital, evidently does not relate to the duration of the immediate process of production, but is determined by circulation. The time for the reproduction of the total capital is determined by the total process, including circulation.

"INEQUALITY IN THE PERIODS NECESSARY FOR PRODUCTION." "THE DIFFERENCE OF TIME REQUIRED TO COMPLETE THE PRODUCTS OF AGRICULTURE, AND OF OTHER SPECIES OF LABOUR, is the MAIN CAUSE of the GREAT DEPENDENCE of the AGRICULTURISTS. THEY CANNOT BRING THEIR COMMODITIES TO MARKET IN LESS TIME

T H A N A YEAR. F O R T H A T WHOLE PERIOD they are obliged T O BORROW of the shoemaker, the TAILOR, the smith, the WHEELWRIGHT, a n d the VARIOUS OTHER LABOURERS, whose products they need, b u t which are COMPLETED IN A FEW DAYS OR

WEEKS. O W I N G T O T H I S NATURAL CIRCUMSTANCE, AND OWING T O T H E MORE RAPID

INCREASE O F T H E WEALTH PRODUCED BY O T H E R LABOUR T H A N T H A T O F AGRICULTURE, T H E MONOPOLISERS O F ALL T H E LAND, [VI-15] though they have also MONOPOLISED

LEGISLATION, have not been able T O SAVE THEMSELVES AND T H E I R SERVANTS, T H E FARMERS, FROM BEING THE MOST DEPENDENT CLASS IN THE COMMUNITY" (Thomas Hodgskin, Popular Political Economy. Four Lectures, etc., London, 1827, p. 147, note) (Notebook IX, p. 44).

"THE NATURAL CIRCUMSTANCE OF ALL COMMODITIES BEING PRODUCED IN UNEQUAL PERIODS, WHILE THE WANTS OF THE LABOURER MUST BE SUPPLIED DAILY... THIS INEQUALITY IN THE TIME NECESSARY TO COMPLETE DIFFERENT COMMODITIES, WOULD in the rude state of society CAUSE T H E HUNTER E T C T O HAVE A SURPLUS O F GAME ETC., BEFORE THE MAKER OF BOWS AND ARROWS ETC. HAD ANY COMMODITY COMPLETED TO GIVE FOR THE SURPLUS GAME. NO EXCHANGE COULD BE MADE; THE BOW MAKER MUST ALSO BE A HUNTER a n d the DIVISION OF LABOUR impossible. This DIFFICULTY led to the invention of MONEY" (pp. 179, 180) (I.e.).

^ The very concept of the free labourer already implies that he is a pauper: a virtual pauper. According to his economic conditions, he is mere living labour capacity, and hence a bearer of the needs of life. All-round indigence, lacking the objective being to realise his labour capacity. If the capitalist has no use for his surplus labour, he cannot perform his necessary labour and thereby produce his means of subsistence. He cannot, in this case, obtain them by means of exchange. If he does obtain them, it can only be because alms accrue to him from the revenue. As a worker, he can only subsist so long as he exchanges his labour capacity for the part of capital which constitutes the wages fund. This exchange is itself tied to conditions which are for him accidental and indifferent vis-à-vis his organic being. Hence he is virtually a pauper.

Moreover, since the condition of production based on capital is that the worker produces an ever greater quantity of surplus labour, it follows that an ever greater quantity of necessary labour is set free. The chances of his sinking into pauperism therefore increase. The development of surplus labour implies that of surplus population.

In different social modes of production, there are different laws governing the growth of population and overpopulation; the latter is identical with pauperism. These different laws can simply be reduced to the different modes of relating to the conditions of production, or, in the case of the living individual, to the conditions for his reproduction as a member of society, since it is only in society that he works and appropriates. The dissolution of these [traditional] relations, with regard to the single individual or a part of the population, posits them outside the reproductive conditions of this particular basis, hence posits them as overpopulation, and not only as destitute but also as unable to appropriate means of subsistence by labour, hence as paupers.

Only in the mode of production based on capital does pauperism appear as the result of labour itself, the result of the development of the productive power of labour. What is overpopulation at one stage of social production may not be overpopulation at another stage, and its effects may be different. E.g. those sent by the ancients to the colonies constituted overpopulation, i.e. they could not continue to live in the same area on the basis of the existing material property relations, i.e. conditions of production. The number [of colonists] may appear very small when compared with the modern conditions of production. Nevertheless, they were a long way from being paupers. But the plebs in Rome with their panis et circenses^[1]*^[8] were paupers. The overpopulation which caused the great Völkerwan-derung presupposed yet other conditions.^[151]

Since in all previous forms of production the development of the productive forces is not the basis of appropriation, but the

7,19* particular mode of relating to the conditions of production (forms of property) appears as a presupposed barrier to the productive forces, which are confined to reproduction, it follows that the growth of population, in which the development of all productive forces is subsumed, must come up even more against an external barrier and thus appear as something to be restricted.

The conditions of communal life are only compatible with a finite size of population. On the other hand, if the limits on population which are posited by the elasticity of the particular form of the conditions of production change, contract or expand in accordance with the latter—thus overpopulation among hunting peoples differed from overpopulation among the Athenians, and the latter differed from overpopulation among the Germanic tribes — the absolute rate at which population increases also changes, and thus the rate of overpopulation and population changes as well. Therefore the [level of] overpopulation which is posited on a particular basis of production is no less determinate than the [level of] sufficient population. Overpopulation and population taken together are the population to which a particular basis of production can give rise. How far it exceeds its barrier is determined by the barrier itself — or rather by the same factor which posits the barrier. Just as necessary labour and surplus labour taken together constitute the totality of labour on a given basis.

Malthus's theory which, incidentally, was not his own discovery, but for which he got the credit by the clerical zeal with which he proclaimed it, really only by the emphasis which he gave to it, is significant in two ways: (1) because he gave a brutal expression to the brutal view taken by capital; (2) because he asserted the FACT of overpopulation in all forms of society. He did not prove it, for nothing could be more uncritical than his motley, kaleidoscopic compilations⁽²¹⁾ from historical and travel literature. His analysis is altogether wrong and childish, because

(1) he considers overpopulation as of the same kind in different historical phases of economic development, does not understand its specific differences and hence stupidly reduces those very complicated and changing relations to one relation, in which on the one hand the natural propagation of mankind, on the other the natural propagation of edible plants (or MEANS OF SUBSISTENCE) confront each other as two natural series, the one geometric and the other arithmetic in progression. In this way, he transforms historically distinct relations into an abstract numerical relation which he simply plucks out of thin air, and which is based on neither natural nor historical laws. There is supposed to be a natural difference between the propagation of men and that of e.g. grain. The monkey here assumes that the increase of mankind is a purely natural process, which requires external RESTRAINTS, CHECKS, if it is not to proceed geometrically.

The geometrical propagation is [supposed to be] the natural process of human propagation. In history, he can find that population develops under widely different conditions and that overpopulation is, likewise, an historically determined relationship, and not at all determined by numbers, or by any absolute limit to the production of means of subsistence. It is always determined by limits posited by particular conditions of production. Limited with respect to numbers. How small do the numbers now seem to us which signified overpopulation to the Athenians! Secondly, limited with respect to character. An overpopulation of free Athenians who are transformed into colonists differs significantly from an overpopulation of workers who are transformed into INMATES OF WORKHOUSES. Similarly, the mendicant overpopulation, which consumes the surplus produce of a monastery, differs significantly from that which develops in a FACTORY. It is Malthus who abstracts from these specific historical laws of population movements, which make up the history of the nature of man, his natural laws. But they are the natural laws of man only at a certain level of historical development, corresponding to a certain level of development of the productive forces which is determined by his own historical process.

Malthusian man, abstracted from historically determined man, exists only in Malthus's brain; hence also the geometrical method of propagation corresponding to this natural Malthusian man. Actual history therefore appears to him in such a light that he does not conceive the propagation of his natural man as an abstraction from the historical process, from actual propagation, but, on the contrary, he conceives actual propagation as an application of the Malthusian theory. Therefore, what constitutes in history, at every stage, the immanent conditions of both population and overpopulation, appears with him as a series of external CHECKS, which have prevented population from growing in the Malthusian way. The conditions in which men historically produce and reproduce themselves, appear as barriers on the reproduction of Malthusian natural man, who is a pure Malthusian creation. [VI-16] On the other side, the production of the means of subsistence, as it is "CHECKED", i.e. determined by the action of men, appears as a CHECK imposed by that production itself. Ferns once covered the whole earth. Their reproduction ceased only when there was no more room for any more. It did not conform to any arithmetical proportion. It is difficult to say where Malthus discovered that the reproduction of spontaneously propagating natural products comes to a halt in response to an inner urge, without external CHECKS. He transforms the immanent, historically changing limits on the process of man's propagation into external barriers; and the external CHECKS acting on natural reproduction into immanent limits or natural laws of propagation.

(2) He foolishly relates a certain number of men to a certain quantity of means of subsistence. Ricardo straight away countered this by correctly pointing out that the quantity of available grain is quite immaterial for the worker if he is without employment; that it is therefore the MEANS OF EMPLOYMENT and not OF SUBSISTENCE which determine whether or not he belongs in the category of surplus population.⁽²²⁾

But this applies more widely, and is true in general of the social mediation by which the individual relates to the means of his reproduction and produces them. Hence it is true of the conditions of production and his relation to them. For the slave in Athens, the only barrier to his multiplication was the quantity of NECESSARIES which could be produced. And we never hear that there was a surplus of slaves in antiquity. On the contrary, the demand for them rose. Yet there was certainly a surplus population of non-workers (in the direct sense), who were not too many with respect to the available means of subsistence, but who had lost the conditions enabling them to appropriate. The invention of surplus workers, i.e. of propertyless men who work, belongs to the epoch of capital.

The beggars who attached themselves to the monasteries, and helped them to consume their surplus product, belong to the same class as the RETAINERS of the feudal lords, and this shows that the surplus PRODUCE could not be entirely consumed by the small number of its owners. This is only another form of the RETAINERS OF OLD, or the MENIAL SERVANTS OF TODAY. Overpopulation among e.g. the HUNTING PEOPLES, which is manifested in the struggle between individual tribes, does not prove that the soil could not support the small number of people who lived on it, but rather that the conditions of their reproduction necessitated a large territory to feed a few mouths. Nowhere [overpopulation] relative to a non-existent absolute quantity of MEANS OF SUBSISTENCE, only relative to the conditions of reproduction, of the production of these MEANS. But this includes the conditions of the reproduction of human beings, of the total population, of relative SURPLUS POPULATION. This surplus purely relative: in no way related to the means of subsistence as such, but only to the mode of their production. Hence also a surplus only given this STATE OF DEVELOPMENT.

(3) What was not, properly speaking, Malthus's own idea at all, the bringing in of the theory of rent, [is] au fond only a formula expressing the fact that at the stage of industrial development familiar to Ricardo, etc., agriculture lagged behind manufacture, an aspect which, incidentally, is immanent in bourgeois production, although in varying degrees. Does not belong here . ^

^Generally speaking, when we look at production based on capital, an essential condition appears to be the combination of the greatest absolute quantity of necessary labour with the greatest relative quantity of surplus labour. Hence as basic condition the greatest possible growth of population — of living labour capacities. If we further look at the conditions for the development of both productive power and exchange, we find that they are the division of labour, cooperation, observation in all directions,which can only be the work of many heads, science, as many centres of exchange as possible — and all these are identical with the growth of population.

On the other hand, it is inherent in the condition for the appropriation of alien surplus labour that necessary population — i.e. the population representing necessary labour, labour necessary for production — is matched by a surplus population, which does not work. In the further development of capital, we find that alongside the industrial part of this surplus population — the industrial capitalists — a purely consuming part branches off. Idlers whose business it is to consume alien products, and [who,] since crude consumption has its limits, have to have a part of these products FORWARDED to them in refined form, as luxury products.

When the economists speak of surplus population, they are not referring to this idle surplus population. On the contrary, it is precisely they, with their consumption business, who are regarded by the population fanatics as necessary population, and [if one takes their view] justly (consistently) so. The expression "surplus population" refers exclusively to labour capacities, i.e. to the necessary population; surplus labour capacities. This arises simply from the nature of capital. Labour capacity can only perform its necessary labour if its surplus labour has value for capital, if it can be valorised by capital. If there are obstacles of one kind or another to its being valorised, labour capacity itself (1) appears to fall outside the conditions of reproduction of its existence; it exists without the conditions of its existence, and is thus A MERE ENCUMBRANCE; it has needs and lacks the means of satisfying them. (2) Necessary labour appears superfluous, because superfluous labour is not necessary. It is necessary only in so far as it is a condition for the valorisation of capital.

Thus the relation between necessary and surplus labour, as it is posited by capital, comes to this, that a part of necessary labour — i.e. of the labour which reproduces the labour capacity— is superfluous, and this labour capacity itself is needed as a surplus of the necessary working population, i.e. of that part of the working population whose necessary labour is not superfluous but necessary for capital. Since the effect of the development of productive power necessarily posited by capital is to increase the ratio of surplus to necessary labour, or to reduce the amount of necessary labour required for a given quantity of surplus labour, then, in a given quantity of labour capacity, the proportion of necessary labour required by capital must constantly diminish, i.e. a part of these labour capacities must become superfluous, because [only] a fraction of the amount previously necessary is now sufficient to perform the given quantity of surplus labour.

Positing a certain portion of labour capacity, i.e. of the labour required to reproduce it, as superfluous, is thus a necessary consequence of the increase in the ratio of surplus to necessary labour. The relative decline of necessary labour appears as a relative increase of surplus labour capacities — i.e. as the positing of surplus population. It is maintained, not out of the wages fund, but out of the income of all classes. It is not maintained by the labour of the labour capacity itself — the worker no longer maintained by his normal reproduction as a worker; he is rather maintained as a living being, by the charity of others. He therefore becomes a derelict and a pauper; in as much as he no longer maintains himself by his necessary labour, by exchange with a part of capital, he has fallen outside the conditions of the apparent relation of exchange and independence. Secondly, society [as a whole] in various proportions takes on for Mr. Capitalist the job of maintaining his virtual instrument of labour — defraying its WEAR and TEAR — keeping it in reserve for later use by him. He passes on a part of the cost of reproducing the working class, [VI-17] and so pauperises a part of the rest of the population for his own profit.

On the other hand, since capital constantly reproduces itself as surplus capital, it tends to posit this pauperism just as much as it tends to transcend it. It acts in opposing directions, so that sometimes one tendency prevails, and sometimes the other.

Finally, positing surplus capital implies the following: (1) It needs a growing population in order to be set in motion; if the relative population it needs has diminished, it has itself grown in proportion. (2) It needs an unemployed (relatively, at least) part of the population, i.e. a relative surplus population, in order to have the population necessary for its growth immediately available. (3) At a given level of the productive forces, surplus value may already be present, but not yet to the degree and in the proportions necessary for its employment as capital. Not only is a minimum level of production posited, but of its growth as well. In this case, surplus capital and surplus population. Likewise, a surplus population may be present, but not large enough, not in the proportions required for surplus production. In all this discussion, we have purposely abstracted entirely from the vicissitudes of the market, its contraction, etc., in short from everything which presupposes the process of many capitals.^

^A. Smith's view that the value of labour never varies, in the sense that for the worker a certain quantity of labour is always a certain quantity of labour, i.e. in A. Smith's view, the sacrifice is always quantitatively equal. Whether I obtain much or little for one hour of work — and that depends on its productivity and on other circumstances — I have worked for one hour. What I had to pay for the result of my labour, for my wage, is always the same hour of work, no matter how its result varies.

"Equal quantities of labour, at all times and places, may be said to be of equal value to the labourer. In his ordinary state of health, strength and spirits, in the ordinary degree of his skill and dexterity, he must always lay down the same portion of his ease, his liberty, and his happiness. The price which he pays must always be the same, whatever may be the quantity of goods which he receives in return for it. Of these, indeed, it may sometimes purchase a greater and sometimes a smaller quantity; but it is their value which varies, not that of the labour which purchases them. Labour alone, therefore, never varies in its own value. It is the real price of commodities; money is their nominal price only" ([A. Smith, Recherches sur la nature

et les causes de la richesse des nations,] éd. Garnier, Vol. I, [Paris, 1802,] pp. 64-66) (Notebook, p. 7 ^[152]).

Thou shalt earn thy bread in the sweat of thy brow! was the curse which Jehovah laid on Adam.a And so A. Smith conceives

;i Genesis 3:19.— Ed.

labour to be a curse. To him, "rest" appears as the adequate state, as identical with "liberty" and "happiness". It does not seem remotely to occur to him that the individual "in his ordinary state of health, strength, spirits, skill, dexterity" also needs a normal portion of labour and the transcendence of "rest". Certainly, the volume of labour itself appears to be externally determined by the aim to be attained and the obstacles to its attainment which have to be overcome by labour. But equally A. Smith has no inkling that the overcoming of these obstacles is in itself a manifestation of freedom — and, moreover, that the external aims are [thereby] stripped of their character as merely external natural necessity, and become posited as aims which only the individual himself posits, that they are therefore posited as self-realisation, objectification of the subject, and thus real freedom, whose action is precisely work.

Of course, Smith is right that in its historical forms of slave labour, serf labour and wage labour, work is always repulsive and always appears as externally imposed, forced labour, and as against that not-work as "liberty and happiness". This holds doubly: it is true of this antagonistic work and of everything connected with it, it is true of work which has not as yet created the subjective and objective conditions (or also of the pastoral, etc., state which has lost them) for work to become travail attractif, to be the self-realisation of the individual, which in no way implies that work is pure fun, pure amusement, as in Fourier's childishly naive conception.⁽²³⁾ Really free work, e.g. the composition of music, is also the most damnably difficult, demanding the most intensive effort.

Work involved in material production can achieve this character only if (1) its social character is posited; (2) if it is of a scientific character and simultaneously general [in its application], and not the exertion of the worker as a natural force drilled in a particular way, but as a subject, which appears in the production process not in a merely natural, spontaneous form, but as an activity controlling all natural forces.

A. Smith, by the way, has only the slaves of capital in mind. E.g. not even the skilled craftsman of the Middle Ages can be subsumed under his definition. However, our immediate concern here is not to discuss his philosophical conception of work, but the economic aspect. If we consider work only as sacrifice, therefore positing value, as price which is- paid for objects and thus endows them with price according to the greater or lesser quantity of labour they cost, we confine ourselves to a purely negative determination of labour. On this basis Mr. Senior for instance could transform capital into a source of production in the same sense as labour, sui generis, a source of value creation, because the capitalist can also be said to make a sacrifice, the sacrifice of ABSTINENCE, in that he enriches himself instead of directly consuming his product." Something that is merely negative, creates nothing. If work for instance is a source of pleasure to the worker — as Senior's abstinence surely is for the miser — the product does not thereby lose any of its value. Labour alone produces; it is the sole substance of products as values.

/ How little Proudhon understands the matter is clear from his axiom that every labour leaves a surplus.*⁽²⁴⁾ What he denies in the case of capital, he makes into a natural attribute of labour. The point is rather that the labour time necessary for the satisfaction of absolute needs leaves free time (the amount differs in different stages of the development of productive forces) and hence surplus produce can be produced if surplus labour is performed. The aim is to transcend the relation itself [the division of the product into necessary and surplus], so that surplus PRODUCE itself appears as necessary,^[153] and so that finally material production leaves every person surplus time for other activities. There is no longer anything mystical about this. Originally, the voluntary gifts of nature abundant, or at least they only had to be appropriated. From the outset spontaneous association (family) and a corresponding division of labour and cooperation. For originally human needs also slight. They themselves grow only with the development of the productive forces./

Its measure, labour time — assuming equal intensity of labour— is therefore the measure of values. The qualitative difference between workers, in so far as it is not natural in origin, posited by sex, age, physical strength, etc.—and thus au fond expresses not the qualitative value of labour but the division of labour and its differentiation — is itself an historical result and then transcended again for the great mass of labour, in that the latter is simple labour, while the qualitatively higher labour takes its measure economically from the simple.

To say that labour time or the quantity of labour is the measure of values, means only that the measure of labour is the measure of values. Two things can be measured in terms of the same unit only if they are of the same nature. Products can only be measured by the measure of labour — by labour time — because by their nature they are labour. They are objectified labour. As objects, they assume forms from which their being as labour may indeed be apparent (as their externally posited suitability for their purpose; though this is not apparent e.g. with the oxen, nor with reproduced natural products in general), but in which there is nothing else in common any more. They exist as things of the same kind [VI-18] so long as they exist as activity. This is measured by time, which therefore becomes the measure of the objectified labour. We shall examine elsewhere the extent to which this measuring is connected with exchange, not with organised social labour — a certain level of the social process of production.

Use value is not related to human activity as the source of the product, to its positing by human activity — but to its being for men. So far as the product has a measure for itself, it is its natural measure, its measure as a natural object, its heaviness, weight, length, spatial volume, etc. The measure of usefulness, etc. But as effect, or as inert being of the power which produced it, it is measured only by the measures of this power itself. The measure of labour is time. It is only because the products are labour that they can be measured by the measure of labour, by labour time, or by the quantity of labour consumed in them. The negation of rest, simply as negation, as ascetic sacrifice, produces nothing. A man may mortify, torment himself etc., the whole day long like the monks, etc., and this quantity of sacrifice which he makes will have no effect at all. The natural price of things is not the sacrifice made to produce them. This is reminiscent, rather, of the pre-industrial notion of acquiring wealth by making sacrifices to the gods. Apart from the sacrifice, there must be something else. What appears as a sacrifice of rest may also be called a sacrifice of idleness, of unfreedom, of unhappiness, i.e. the negation of a negative condition.

A. Smith considers work psychologically, with respect to the pleasure or displeasure which it gives the individual. Yet it must be something else in addition to this sentimental relation to his activity — above all for others, since the mere sacrifice of A would be of no use to B; but also the way he himself relates to the object which he works on and to his own disposition to work. Labour is a positive, creative activity. Of course the measure of labour, time, does not depend on the productivity of labour; its measure is nothing but a unit of which the fractional parts of labour express a particular number. It certainly does not follow from this that the value of labour is constant; or this follows only in so far as equal quantities of labour are of equal measured magnitude.

If we wish to define the matter more precisely, we find that the values of products are measured not by the labour which was bestowed on them, but by the labour necessary for their production. Thus not the sacrifice but the labour as the condition of production. The equivalent expresses the condition of their reproduction as given to them by exchange, i.e. the possibility of the renewal of productive activity as posited by its own product.^-

^ B y the way, A. Smith's theory of sacrifice, which actually expresses correctly the subjective attitude of the wage worker to his own activity, does not achieve the object of the exercise — namely the determination of value by labour time. For the worker, an hour of labour may always be an equally great sacrifice. But the value of commodities by no means depends upon his FEELINGS; nor does the value of his hour's labour. Since A. Smith admits that one may sometimes purchase this sacrifice more cheaply and sometimes more dearly, it is odd that it should always be sold at the same price. He is also inconsistent. For he subsequently makes wages into the measure of value, not the quantity of labour. The sacrifice of the ox when it is slaughtered is always the same. [But] that does not make beef constant in valued

^"'But though equal quantities of labour are always of equal value to the labourer, yet to the person who employs him they appear sometimes to be of greater and sometimes of smaller value. He purchases them sometimes with a greater and sometimes with a smaller quantity of goods, and to him the price of labour seems to vary like that of all other things. In reality, however, it is the goods which are cheap in the one case, and dear in the other" (A. Smith, I.e., Vol. I, p. 66) (Notebook, p. 8)../

^ The way in which A. Smith explains the origin of profit is very naive.

"In the early and rude state of society the whole produce of labour belongs to the labourer; and the quantity" (also the greater difficulty, etc.) "of labour commonly employed in acquiring or producing any exchangeable object is the only circumstance which regulates the quantity of labour which it ought commonly to purchase, command, or exchange for... But as soon as stock has accumulated in the hands of particular persons the value which the workmen add to the object resolves itself into two parts, of which the one pays their wages, the other the profits of their employer upon the whole stock of materials and wages which he advanced. He could have no interest to employ them, unless he expected from the sale of their work something more than what was sufficient to replace his stock to him; and he could have no interest to employ a great stock rather than a small one, unless his profits were to bear some proportion to the extent of his stock" (I.e., pp. 96, 97) (Notebook, p. 9 ^[152]).

(Cf. the peculiar view of A. Smith that [in the period] prior to the division of labour,

"in which everyman provides everything for himself, it is not necessary that any stock should be accumulated or stored up beforehand..." [op. cit., Vol. II, pp. 191-92].

As though in this state of society, the individual, finding no stock provided by nature, would not have to find the objective conditions of life in order to be able to work. Even the savage, even animals, accumulate reserves. What Smith talks about can only apply to the state of society where nothing but immediate, momentary instinct impels men to some immediate piece of work, and in that case, the stock must d'une manière or d'autre be present in nature without labour (Notebook, p. 19). (Smith gets things confused. Concentration of stock in one hand not then necessary.)^

^"In Vol. Ill of his edition of A. Smith [An Inquiry into the Nature and Causes of the Wealth of Nations, London, 1846], Wakefield remarks:

" T H E LABOUR OF SLAVES BEING COMBINED, IS MORE PRODUCTIVE THAN THE MUCH DIVIDED LABOUR OF FREEMEN. T H E LABOUR OF FREEMEN IS MORE PRODUCTIVE THAN THAT OF SLAVES, ONLY WHEN IT COMES TO BE COMBINED BY MEANS OF GREATER DEARNESS

OF LAND, AND THE SYSTEM OF HIRING FOR WAGES" ( p . 1 8 , n o t e ) ( Notebook V I I I , p . 1). "IN COUNTRIES WHERE LAND REMAINS VERY CHEAP, EITHER ALL THE PEOPLE ARE IN A STATE OF BARBARISM, OR SOME OF THEM ARE IN A STATE OF SLAVERY" (I.E.).,/-

^"'PROFIT IS A TERM SIGNIFYING THE INCREASE OF CAPITAL OR WEALTH; SO FAILING TO FIND THE LAWS WHICH GOVERN THE RATE OF PROFIT, IS FAILING TO FIND THE LAWS OF THE FORMATION OF CAPITAL" (W. Atkinson, Principles of Political Economy, London, 1840, p. 55) (Notebook,^[150] p. 2)../

. / " ' M A N I S A S M U C H T H E PRODUCE OF LABOUR A S A N Y O F T H E M A C H I N E S C O N -

S T R U C T E D BY HIS AGENCY; AND IT APPEARS TO US THAT IN ALL ECONOMICAL INVESTIGATIONS HE OUGHT TO BE CONSIDERED IN PRECISELY THE SAME POINT OF VIEW. EVERY INDIVIDUAL WHO HAS ARRIVED AT MATURITY MAY, WITH PERFECT PROPRIETY, BE VIEWED

AS A MACHINE WHICH IT HAS COST 2 0 YEARS OF ASSIDUOUS ATTENTION AND THE EXPENDITURE OF A CONSIDERABLE CAPITAL TO CONSTRUCT. And if a further sum is laid out in his education or QUALIFICATION for the EXERCISE OF A BUSINESS, etc., his value is proportionately INCREASED, exactly as a machine is rendered more valuable by the EXPENDITURE of ADDITIONAL CAPITAL or labour in its construction, in order to give new POWERS to it" (MacCulloch, The Principles of Political Economy, Edinburgh, 1825, p. 115) (Notebook, p. 9).

"IN POINT OF FACT, A COMMODITY WILL ALWAYS EXCHANGE FOR MORE" LABOUR (than that with which it has been produced): "AND IT IS THIS EXCESS THAT CONSTITUTES PROFITS" (MacCulloch, I.e., p. 221) (Notebook, p. 13).

The same worthy MacCulloch, of whom Malthus rightly says that for him the distinctive attribute of science [VI-19] is the equation of everything with everything, ^[3] says:

"THE PROFITS OF CAPITAL ARE ONLY ANOTHER NAME FOR THE WAGES OF ACCUMU-l.ATF.n LABOUR" (I.e., p. 291) (Notebook, p. 14)

and hence presumably also the WAGES OF LABOUR [are] ONLY ANOTHER

NAME FOR THE PROFITS OF LIVING CAPITAL.

"WAGES ... REALLY CONSIST OF A PART OF THE PRODUCE OF THE INDUSTRY OF THE LABOURER; CONSEQUENTLY, their real value is high if the LABOURER gets a comparatively large part of the product of his industry, and conversely" (I.e., p. 295) (Notebook, p. 15)./"

^ C a p i t a l ' s positing of surplus labour is generally so little understood by the economists that they present individual striking p h e n o m e n a in which it manifests itself as something extraordinary, as curiosities. Ramsay on night-work is an example. John Wade, in his History of the Middle and Working Classes, 3rd ed., London, 1835 (p. 240) (Notebook, p. 21), writes for instance:

"The STANDARD OF WAGES is also related to the hours of labour and the periods of rest. It was the policy of the MASTERS in recent years" (before 1835) "to usurp

ON | THE] OPERATIVES i n t h i s RESPECT, b y CUTTING [OFF] OR ABRIDGING HOLIDAYS a n d

MEALTIMES and gradually extending the hours of labour; knowing that an INCREASE of one-quarter in labour time is equivalent to a reduction of the same extent in the AMOUNT OF WAGES.",/'

John Stuart Mill, Essays on Some Unsettled Questions of Political Economy, London, 1844. (The few original ideas of Mill junior are contained in this slim booklet, not in his voluminously pedantic magnum opus.b)

"Whatever is destined to be employed reproductively, either in its existing shape, or INDIRECTLY BY A PREVIOUS (OR EVEN SUBSEQUENT) EXCHANGE, is capital. Suppose that I have laid out all the money I possess in wages and tools, and that the article which I produce is just COMPLETED; in the interval which elapses before I can sell the article, realise the proceeds, and lay them out again in WAGES and TOOLS, will it be said that I have no capital? Certainly not: I have the same capital as before, perhaps a greater, but it is locked up and is not DISPOSABLE" (p. 55) (Notebook, p. 36).

"At all times a very large proportion of the capital of a country is lying idle. The annual produce of a country is never anything approaching in magnitude to what it might be if all the resources devoted to reproduction, if all the capital, IN

11 Th. R. Malthus, Definitions in Political Economy, London, 1827, pp. 69-70.— Ed.

l> Principles of Political Economy with some of their Applications to Social Philosophy, in two volumes, London, 1848. Below Marx quotes from Essays....— Ed.

SHORT, of the country, were IN FULL EMPLOYMENT. / / every commodity on an average remained unsold for a length of time equal to that required for its production, it is obvious that, at ANY ONE TIME, no more than half the productive capital of the country would be really performing the FUNCTIONS of capital. The half which was in employment would be a fluctuating portion, composed of varying parts; but the result would be, that each producer would be able to produce every year only half as large a supply of commodities, as he could produce if he were sure of selling them the moment the production was completed" (I.e., pp. 55, 56). "This, or something like it, is HOWEVER the habitual state of a very large proportion of all the capitalists in the world" (p. 56).

"The number of producers, or dealers, who turn over their capital in the shortest possible time, is VERY small. There are few who have so rapid a sale for their wares, that all the goods which their own capital, or the capital which they can borrow, enables them to supply, are carried off as fast as they can be supplied. The majority have not an EXTENT OF BUSINESS, AT ALL ADEQUATE TO THE AMOUNT OF THE CAPITAL THEY DISPOSE OF. It is true that, in the communities in which industry and commerce are practised with greatest success, the CONTRIVANCES OF BANKING enable the possessor of a larger capital than he can employ in his own business, to employ it productively and derive a revenue from it notwithstanding. Yet even then, there is a great quantity of capital which remains fixed in the shape of IMPLEMENTS, MACHINERY, BUILDINGS, etc., whether it is ONLY HALF EMPLOYED, OR IN COMPLETE EMPLOYMENT: and every DEALER keeps a STOCK IN TRADE,TO BE READY FOR A POSSIBLE SUDDEN DEMAND, though he may not be able TO DISPOSE OF IT FOR AN INDEFINITE PERIOD" (p. 56). "This perpetual non-employment of a large proportion of capital, is the price we pay for the division of labour. The purchase is worth what it costs; BUT THE PRICE IS CONSIDERABLE" (p. 56).

If I have invested 1,500 thaler in a SHOP and derive a profit of 10% on it, while 500 lies IDLE in order to decorate the SHOP, etc., it is the same as if I had invested 2,000 thaler at [a profit of] 7 l/2%.

"In many TRADES, there are some DEALERS who sell articles of an equal quality at a lower price than other DEALERS. This is not a voluntary sacrifice of profits: they expect by the consequent OVERFLOW of CUSTOMERS to turn over their capital more quickly, and to be gainers BY KEEPING THE WHOLE OF THEIR CAPITAL IN MORE CONSTANT EMPLOYMENT, though on any given operation their gains are less" (pp. 56, 57). "It is QUESTIONABLE whether there be any DEALERS for whom an additional purchaser is of no use; and to the great majority this hypothesis is not applicable at all. An additional customer, to most DEALERS, is equivalent to an increase of their productive capital. He enables them to convert a portion of their capital which was lying idle (and which could never have become productive in their hands until a customer was found) into WAGES and INSTRUMENTS OF PRODUCTION... The aggregate produce of the country for the succeeding year is, therefore, increased; not by the mere exchange, but BY CALLING INTO ACTIVITY a portion of the national capital, which, HAD IT NOT BEEN FOR THE EXCHANGE, would have remained FOR SOME TIME longer UNEMPLOYED" (pp. 57, 58).

"The benefit which a producer or DEALER derives from the acquisition of a new customer can be defined as follows:

"(1) If any part of his capital was locked up in the form of unsold goods, producing (for a longer or shorter period) NOTHING AT ALL; a portion of this is called into greater activity, and becomes MORE CONSTANTLY PRODUCTIVE.

"(2) If the ADDITIONAL DEMAND exceeds what can be supplied by setting at liberty the capital which exists in the state of unsold goods; and if the DEALER has additional resources, which were productively invested (in the public funds, for instance), but not in his own TRADE; he is enabled to obtain, ON A PORTION OF THESE, not mere interest, but profit, and so to gain that difference between the rate OF PROFIT and the rate OF INTEREST.

"(3) If all the dealer's capital is employed in his own trade, and no part of it locked up as unsold goods, he can carry on an additional business with borrowed capital, and so gain the difference between interest and profit" (p. 59).

NOTES

AND INDEXES

---

Endnotes

* See this volume, pp. 150-52, 167-68 and 186-87.—Ed.

[123] Marx means James Mill's proposition that there exists a permanent and necessary equilibrium between production and consumption, between supply and demand, and between the sum-total of purchases and the sum-total of sales. First put forward in Mill's pamphlet Commerce Defended (London, 1808), it was seconded by Say. Marx discusses this proposition in greater detail in A Contribution to the Critique of Political Economy, Part One, Chapter Two, 2 (see present edition, Vol. 29) and in the manuscripts of 1861-63.— 338

[124] Marx means the "little shilling men", the Birmingham school of political economy initiated by the English banker Thomas Attwood. Its views were put forth in Letters, a book published The Currency Question. The Gemini anonymously in London in 1844 by Thomas Wright and John Harlow, who called themselves the Gemini.—339

(1) H. Storch, Considérations sur la nature du revenu national, pp. 126-59.— Ed.

(2) Th. R. Malthus, Principles of Political Economy, 2nd ed., London, 1836, p. 405 (publisher's note), and J. Ch. L. Simonde de Sismondi, Études sur l'économie politique, Vol. I, p. 61.— Ed.

(3) D. Ricardo, On the Principles of Political Economy, and Taxation, pp. 80-85.— Ed.

(4) See J. Cray, Lectures on the Nature and Use of Money, pp. 67, 108, 123, 125 and 142-48.—-Ed.

(5) A. Smith, An Inquiry into the Nature and Causes of the Wealth of Nations. With a Commentary, by the Author of England and America [E. G. Wakefield], Vol. I, London, 1835, pp. 244-46.— Ed.

13-852

[125] The last sentence is a summary of the following passage in Hodgskin's book (pp. 245-46): "When the capitalist, being the owner of all the produce, will allow labourers neither to make nor use instruments, unless he obtains a profit over and above the subsistence of the labourer, it is plain the bounds are set to productive labour much within what Nature prescribes. In proportion as capital in the hands of a third party is accumulated, so the whole amount of profit required by the capitalist increases, and so there arises an artificial check to production and population."—343

(6) Here Marx wrote, in a separate line, "JANUARY (1858)".— Ed.

[133] This section of the 1857-58 manuscript takes u p pages 50-53 of Notebook IV a n d pages 1-15 of Notebook V. T h e title, "Forms Preceding Capitalist Production", is from Marx's References to My Own Notebooks (see present edition, Vol. 29). Pages 1-15 of Notebook V are entided in the References "Continuation on the Process Preceding the Formation of the Capitalist Relationship or Primitive Accumulation". For details concerning earlier publications of this section see Note 22.—399

a Common land, state-owned land in ancient Rome.— Ed.

[134] Thg term "Stamm", translated here as "tribe", was used in the middle of the 19th century in a broader sense than today and denoted all people descended from a common ancestor, thus covering the modern concept of the "gens" as well as that of the "tribe". A precise definition and differentiation of these concepts was given by the American ethnographer and historian Lewis Henry Morgan. In his Ancient Society (1877), he brought out the importance of the gens as the basic unit of the primitive communal system and thus laid the scientific foundation for the study of the history of primitive society as a whole. Marx and Engels saw in Morgan's discoveries confirmation of their proposition — put forward by them in The German Ideology, and elaborated by Marx in the present manuscript and by Engels in his studies on the history of Ireland (1869-70)—that tribal relations constituted a stage common to the development of all peoples. (See also Note 10.) —400

a Artisans (in ancient Rome).— Ed.

11 I.e. the property of the quirites, citizens of ancient Rome in their civil capacity.— Ed. b Here Marx inserted the following passage in brackets: "Where property exists only as communal property, the individual member is as such only the occupier of a

a " N o Roman was permitted to lead the life of a petty trader or craftsman." Niebuhr quotes from Roman Archaeology by Dionysius of Halicarnassus.— Ed. 15-852

[136] Dithmarschen—a region in North Germany. Inhabited in the Middle Ages by East Saxons and Franks, Dithmarschen was a stronghold of the free peasantry, who for a long time retained the communal system and staunchly resisted the attempts by German and Danish feudal lords to subjugate them. The communal system survived even after the conquest of Dithmarschen, in 1559, by the King of Denmark.—406

[137] Gaels—the indigenous population of the mountain regions of Northern and Western Scotland, descendants of the Celts.— 406

(1) Here Notebook V of the manuscript begins. The cover bears the words: "Notebook V. January 1858. London (Begun on 22 January)." An inscription on page 1 reads: "Notebook V. Chapter on Capital (Continued)." — Ed.

15*

(2) See P. J. Proudhon, Système des contradictions économiques, ou Philosophie de la misère, Vol. II, Paris, 1846, p. 269; also Karl Marx, The Poverty of Philosophy. Answer to the "Philosophy of Poverty" by M. Proudhon, present edition, Vol. 6, p. 197.— Ed.

(3) In one way or another.— Ed.

a So much the better.— Ed.

(4) Resident aliens.— Ed.

(5) A status equivalent to citizenship.— Ed.

(6) Potentially.— Ed.

Potentially.— Ed.

(7) Once capital and wage labour are posited as their own presupposition, as the basis presupposed to production itself, then what appears initially is that the capitalist, in addition to the fund of raw material and means of labour required for the worker to reproduce himself, to produce the necessary means of subsistence, i.e. to realise necessary labour, must possess a fund of raw material and means of labour in which the worker realises his surplus labour, i.e. the capitalist's profit. Further analysis reveals that the worker is constantly creating a double fund for the capitalist, or in the form of capital, one part of which constantly fulfils the conditions of his own existence, and the other, the conditions of the existence of capital. As we have seen, in surplus capital — and surplus capital in its relation to its antediluvian relation to labour — all real, present capital, each of its elements, has been uniformly appropriated as objectified alien labour, appropriated by capital, without exchange, without an equivalent being given in return.

(8) Nothing would be more obviously and nonsensically circular than the argument that, on the one hand, the workers whom capital must set to work if it is to posit itself as capital, must first be created and called into life by its accumulation (waiting, as it were, for its "Let there be workers!"), while, on the other hand, capital could not accumulate without alien labour, could at most accumulate its own labour, i.e. that capital could itself exist in the form of non-capital and non-money; for prior to the existence of capital, labour can only realise itself in the form of handicraft work, of small-scale agriculture, etc., in short,only in forms in which no or only little accumulation is possible, which allow for only a small SURPLUS PRODUCE, and consume the greater part of that. In general, we shall have to look more closelv at this concept of accumulation later.

[139] This refers to the laws against vagabonds and beggars introduced in England under the first Tudors (Henry VII and Henry VIII) and in later years. They envisaged cruel corporal punishment (branding, maiming) and slavery, in some cases even execution, for able-bodied persons accused of vagabondage and beggary. On the part played by this legislation in turning the expropriated population into wage labourers see Capital, Vol. I, Chapter XXXVIII (present edition, Vol. 35).—431

(9) A. Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book III, Chapter IV.— Ed.

(10) See this volume, pp. 384-87.— Ed.

[90] This refers to the British Owenites John Francis Bray, John Gray, Thomas Hodgskin, William Thompson and others who drew socialist conclusions from Ricardo's theory (see Note 32). Marx discussed their views in the manuscripts of 1861-63, in connection with the pamphlet Labour Defended against the Claims of Capital (London, 1825), published anonymously by Thomas Hodgskin. He examined the tendency, common to all these socialists, to regard capital not as a social relation but as a sum of objects and explain the misery of the working people by the estranged form in which these objects appear in the hands of the capitalists (see present edition, Vol. 32).—229, 436

a The principal of a loan.— Ed.

(11) See Ch. D. Du Cange, Glossarium mediae et infimae latinitatis ..., Vol. II, Paris, 1842, pp. 139-42.—£d.

(12) Crop-sharing.— Ed. cl Contract of leasing cattle.— Ed.

e Headmen.— Ed. { Who have to pay a head tax.— Ed. s A. H. Müller, Die Elemente der Staatskunst, Part I, Berlin, 1809, pp. 226-41.— Ed.'

(13) "I shall give a tithe of my property to God, both in living cattle and in the dead fruits of the soil." Marx quotes from Du Cange's Glossarium etc.— Ed. 16-852

(14) Page 16 of Notebook V begins with a passage relating to the next section of the Chapter on Capital (see this volume, p. 439).— Ed.

a See this volume, pp. 384-87.— Ed. b The above two paragraphs are on page 16 of Notebook V.— Ed. 16*

(1) See this volume, p. 130.— Ed.

See this volume, p. 442.— Ed.

(2) See this volume, pp. 329-30.— Ed.

(3) Par excellence.— Ed.

(4) Here Marx crossed out the following passage: "Certainly not! Where then does his profit come from? The public pays him interest and profit. So far as the road facilitates production and exchange, it is a productive force, not value — use value for the act of production."—Ed.

11 At any cost.— Ed.

(5) Here Marx has the following digression in brackets: "In Rome, the army constituted a mass [of individuals] — but already divorced from the rest of the people — disciplined for labour whose surplus time belonged to the State. They sold the whole of their labour time to the State for a wage, they exchanged the whole of their labour capacity for a wage necessary for the maintenance of their life, in precisely the same way as the worker does with the capitalist. This was true of the time when the Roman army was no longer a citizens' army but an army of mercenaries. In this case the soldiers likewise freely sold their labour. But the State does not buy it for the purpose of producing values. Thus, although it may appear that the form of wage labour initially came into existence in armies, this mercenary system is essentially different from wage labour. There is a certain similarity in the fact that the State uses up the army to increase its power and wealth." — Ed.

[141] The Liverpool and Manchester Railway was opened on September 15, 1830. Built under the direction of George Stephenson, it was the first line fully served by locomotives. Earlier-built lines, including the 21-kilometre Stockton and Darlington Railway (opened in 1825), on which Stephenson's locomotive was first employed, partly used horse traction.—454

il Public works.— Ed.

(6) > A waste of money.— Ed.

(7) Investment is lost.— Ed.

[142] The Roman numeral refers to an undiscovered notebook of Marx's filled between 1844 and 1847.—461

(8) In order to be able to live.— Ed.

(9) Labour in order to be able to make a profit.— Ed.

c Factory owner.— Ed.

d By all the growth in the productive forces brought about by the division of labour.— Ed.

e Raw material, instrument, means of subsistence.— Ed.

•' See this volume, pp. 408-20.— Ed.

(10) Potentially.— Ed.

(11) Marx reproduces the two passages from Thompson in a free rendering, on the basis of his 1845 notebook of excerpts.— Ed.

(12) See this volume, pp. 329-31.— Ed. 17-852

(13) G. Ramsay, An Essay on the Distribution of Wealth, p. 55.— Ed.

17*

(14) H. Storch, Cours d'économie politique, Vol. I, pp. 404-13.— Ed.

b Overhead costs of production.— Ed.

HAS PAID FOR— SURPLUS LABOUR, WHICH IS CONVERTED INTO SURPLUS VALUE AND SURPLUS PRODUCE, ENABLING THE CAPITAL TO RENEW THIS PROFITABLE BARGAIN, WHERE THE MUTUALITY IS ALL ON ONE SIDE, ON A MORE ENLARGED SCALE. IT IS ENABLED T O EMPLOY MORE NEW LIVING LABOUR, BECAUSE DURING THE PROCESS OF PRODUCTION A PORTION OF FRESH LABOUR HAS BEEN BESTOWED UPON IT BEYOND THE ACCUMULATED LABOUR OF WHICH IT CONSISTED BEFORE ENTERING THAT PROCESS.

(1) D. Ricardo, On the Principles of Political Economy, and Taxation, pp. 338-39.— Ed.

(2) Ibid., p. 3.— Ed.

(3) Ibid., p. 86.— Ed.

(4) See this volume, pp. 252.— Ed.

[ V I - l ] b " A N Y CHANGE THAT CAN DISTURB THE EXISTING RELATIONS BETWEEN WAGES AND PROFITS MUST ORIGINATE IN WAGES" (Quincey, I.e. (X, 5), p. 205). a By virtue of this.— Ed. b On the first page of this notebook Marx wrote: "Notebook VI. Chapter on Capital. London. February. 1858." — Ed.

a H. C. Carey, Principles of Political Economy, Part I, Ch. 6, pp. 73-101.— Ed.

[25] In the manuscript, Marx rounds off the figures cited by Darimon (the latter gives the number of centimes as well as of francs). However, some of the approximations are not quite accurate.— 52

[144] McCulloch's unjustified extension of the concept of labour to the processes of Nature was discussed by Marx in detail in the manuscripts of 1861-63 (see present edition, Vol. 32).—479

"A machine, as soon as its secret is known, WILL N O T SELL FOR THE LABOUR PRODUCED, B U T FOR T H E LABOUR PRODUCING ... I T WILL N O LONGER BE VIEWED AS A CAUSE EQUAL TO CERTAIN EFFECTS, B U T AS AN EFFECT CERTAINLY REPRODUCIBLE BY A KNOWN CAUSE AT A KNOWN COST" ([I.e.] p p . 84, 85).) a J. R. MacCulloch, The Principles of Political Economy, p. 313.— Ed.

(5) J. F. Bray, Labour's Wrongs and Labour's Remedy, Leeds, 1839, pp. 28, 31, 34, 41-43, 47-50, 52, 53-57, 59-61, 68, 81-85, 153 and 154.— Ed.

(6) A. Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Vol. I, London, 1835, pp. 100-02 and 130-31.— Ed.

[145] Marx uses the same example to illustrate the calculation of profit in a letter to Engels written about a month later, on March 5, 1858 (see present edition, Vol. 40, p. 283).—485

[67] Marx is referring to a notebook he filled in Brussels in the summer of 1845 with excerpts (on which he comments) from Boisguillebert's works, as published by E. Daire in a collection entitled Economistes financiers du XVIIIe siècle (Paris, 1843).—165

[20] The Crédit Mobilier (Société générale du Crédit mobilier) was a big French joint-stock bank founded by_ the Péreire brothers in 1852. It was notorious for speculation and other irregular practices. The Crédit Mobilier took an active part in railway construction and the establishment of industrial enterprises. Though closely linked with and enjoying the protection of Napoleon Ill's government, it went bankrupt in 1867. In 1856 and 1857, Marx wrote a series of articles about its speculative activities for the Chartist People's Paper, published in London, and the New-York Daily Tribune (see this edition, Vol. 15, pp. 8-24, 270-77, 357-60).—47, 59

[146] To calculate the turnover of the fixed capital (£10,000) Marx divides it by the sinking fund (£650); to calculate the tuns.wer of the circulating capital, he divides the contingencies (£1,100), the wages (£2,600) and the cost of the raw materials (£10,000) —£13,700 in all — by trie circulating capital (£7,000).—486

[147] In his letter to Engels of March 5, 1858, Marx adduces this example of profit calculation and remarks: "It is a great pity that the above statement does not show the number of operatives, or the proportion of actual wages to what appears as salaries" (see present edition, Vol. 40, p. 283). In this passage of his manuscript Marx assumes that wages account for exactly l/ß of the annual outlays, while the rest of the £2,600 goes for salaries.— 486

[7] The heading "I. Production, Consumption, Distribution, Exchange (Circulation)" does not occur in Marx's table of contents on the cover of Notebook M and refers, strictly speaking, only to the first two sections of the Introduction, that headed "Production" (the heading in the table of contents on the cover is more accurate: "Production in general") and that headed "The General Relation of Production to Distribution, Exchange and Consumption". There are no Roman numerals in the further text of the Introduction to correspond to the figure I marking the section "Production, Consumption, Distribution, Exchange (Circulation)".—17

[12] Determination is negation—Marx quotes this thesis of Spinoza in the widely accepted interpretation given it by Hegel. In Spinoza, it means "limitation is negation" (Epistolae doctorum quorundam virorum ad B. de Spinoza et auctoris responsiones; ad aliorum ejus operum elucidationem non parum facientes. Epistola L 1674). Hegel's interpretation emphasises the element of negation 2 Junii inherent in any determined being, in any particular thing (see his Wissenschaft der Logik, Book I, Part I, Chapter 2, note on "Reality and Negation" and his Enzyklopädie der philosophischen Wissenschaften, Part I; Wissenschaft der Logik, § 91, Addendum).—28

(7) Here the following passage is crossed out in the manuscript: "In this sense, the value of every product is constant. But, Malthus says, the difference is that what measures the value of the product — namely the [living] labour bestowed on it — differs AT ALL INSTANCES from the product itself, since the latter has other properties too. The product is measured by something distinct from it — living labour." — Ed.

(8) H. C. Carey, Principles of Political Economy, Part I, pp. 73-80, 83-92, 99, 337 and 339-40.— Ed.

a Ibid.— Ed.

7.18-852

[149] This refers to a quotation in Bailey's book (pp. 57-58) from Albert Gallatin's Considerations on the Currency and Banking System of the United States, Philadelphia, 1831, p. 68.—503

a Overhead costs of production.— Ed.

(9) P. Gaskell, Artisans and Machinery, London, 1836, pp. 11-114 and 293-362.— Ed. 18*

(10) Ch. Babbage, Traité sur l'économie des machines et des manufactures, p. 485. Marx quotes in French.— Ed.

a P. Rossi, "Cours d'économie politique. Année 1836-1837", Cours d'économie politique, Brussels, 1843, p. 353.— Ed.

(11) Marx quotes in French.— Ed.

(12) Workers.— Ed.

(13) Marx quotes in French.— Ed.

(14) R. Torrens, An Essay on the Production of Wealth, London, 1821, pp. 70-71.— Ed.

(15) Ibid., pp. 33-34.— Ed.

(16) Marx quotes in German except for a few isolated words and phrases reproduced in French.— Ed.

•' Marx quotes in German except for a few isolated words and phrases •-•-••produced in French.— Ed. '' Marx quotes in French.— Ed.

(17) In existence.— Ed.

(18) In possibility.— Ed.

(19) H. C. Carey, The Past, the Present, and the Future, Philadelphia, 1848, pp. 74-75.— Ed.

"In the first place: I HAD NOWHERE SEEN IT STATED, THAT THE ORDINARY QUANTITY OF LABOUR WHICH A COMMODITY WILL COMMAND MUST REPRESENT AND MEASURE THE QUANTITY OF LABOUR WORKED UP IN IT, WITH THE ADDITION OF PROFITS... BY REPRESENTING THE LABOUR WORKED UP IN A COMMODITY, WITH THE ADDITION OF PROFITS, LABOUR represents THE NATURAL AND NECESSARY CONDITIONS OF ITS SUPPLY, OR THE ELEMENTARY COSTS OF ITS PRODUCTION. Secondly. I HAD NOWHERE SEEN IT STATED THAT, HOWEVER THE FERTILITY OF THE SOIL MIGHT VARY, THE ELEMENTARY

[58] The monetary system, an early form of mercantilism, consisted of a variety of economic measures applied by European states in the 17th and 18th centuries. Its advocates equated wealth with money and favoured policies designed to ensure the inflow of money into the country by maintaining an active trade balance and imposing protective tariffs.—148, 520

(20) A. Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book I, Chapter XI, Part I.— Ed. 7,19-852

[151] For the colonies of antiquity and the Völkerwanderung see Marx's article of March 4, 1853 for the New-York Daily Tribune, "Forced Emigration.—Kossuth and Mazzini.—The Refugee Question.—Election Bribery in England.—Mr. Cobden" (present edition, Vol. 11).—523

(21) [Th. R. Malthus,] An Essay on the Principle of Population.— Ed.

19-852

(22) D. Ricardo, On the Principles of Political Economy, and Taxation, pp. 493 and 495.— Ed.

19*

(23) Ch. Fourier, "Le Nouveau Monde industriel et sociétaire", Œuvres complètes, 3rd ed., Vol. 6, Paris, 1848, pp. 245-52.— Ed.

[153] Concerning the transformation of surplus labour into necessary labour under communism, Marx says the following in Capital, Vol. I (present edition, Vol. 35): "Only by suppressing the capitalist form of production could the length of the working day be reduced to the necessary labour-time. But, even in that case, the latter would extend its limits. On the one hand, because the notion of 'means of subsistence' would considerably expand, and the labourer would lay claim to an altogether different standard of life. On the other hand, because a part of what is now surplus labour, would then count as necessary labour; I mean the labour of forming a fund for reserve and accumulation."—

a N. W. Senior, Principes fondamentaux de l'économie politique, pp. 309-35.— Ed.

(24) P. J. Proudhon, Système des contradictions économiques, ou Philosophie de la misère, Vol. I, p. 73; Gratuité du crédit. Discussion entre M. Fr. Bastiat et M. Proudhon, p. 200.— Ed.

[14] Marx discusses the views of Say and Storch on the relation between production and consumption in the chapter "Adam Smith" of his manuscripts of 1861-63 (see present edition, Vol. 30).—31, 339

[1] The unfinished draft manuscript "Bastiat and Carey", the first of Marx's Economic Manuscripts of 1857-58, takes up the first seven pages in one of the seven notebooks containing the main manuscript of that cycle, the Outlines of the Critique of Political Economy (Rough Draft). However, the date, "July 1857", which Marx put on the cover of that notebook, shows that "Bastiat and Carey" was written somewhat earlier than the Outlines. Pages 1, 2, 3 and the upper half of page 4 contain the "Avantpropos" (Introductory Notes) to "Bastiat and Carey", the lower half of page 4 is blank, and pages 5-7 are taken up by a passage entitled "XIV. De salaires". From page 8 onwards, there follows the continuation of the text contained in Notebook II of the main manuscript (see page 219 of this volume). Marx marked this continuation "Notebook III" and dated it "November 29 and 30, and December 1857". Since in the manuscript the draft bears the same subtitle as Bastiat's book, it may be assumed that Marx originally wanted to write an extensive review, but later decided that the book did not deserve detailed discussion, and therefore gave up his original intention. The draft goes beyond the bounds of an ordinary review. In the "Avantpropos", Marx sums up the bourgeois political economy of his time and strictly delimits the era of classical political economy as beginning in the late 17th century, with the works of Petty and Boisguillebert, and ending in the first third of the 19th century, with the writings of Ricardo and Sismondi. He shows that the bourgeois economists of the subsequent period were either epigones of the classics or vulgar critics of them. The works of the Frenchman Bastiat and the American Carey, directed above all against Ricardo, were examples of that kind of criticism. The title "Bastiat and Carey" occurs in Marx's "References to My Own Notebooks", written in the summer of 1861 (see present edition, Vol. 29). This shows that Marx himself regarded the draft as part of his Economic Manuscripts of 1857-58. He quotes from Bastiat partly in French and partly in German translation. In this volume, all quotations are in English; only foreign-language phrases in Marx's own text are given in the language of the original. The draft was first published in the journal Die Neue Zeit, Vol. 2, No. 27, Stuttgart, 1903-1904. In English, it first appeared, under the title "Critique of Bastiat and Carey", in Marx's Grundrisse by David McLellan, Macmillan Press Ltd., London, 1971, pp. 47-58 and in: Karl Marx, Grundrisse. Foundations of the Critique of Political Economy (Rough Draft). Translated with a Foreword by Martin Nicolaus. Penguin Books in association with New Left Review. London, 1973, pp. 883-93.-5

[8] Contrat social—in Rousseau's theory, the voluntary agreement entered into by primitive people — originally living in "the state of nature"—which led to the formation of the political state. The theory was set forth in Rousseau's Du Contrat social; ou Principes du droit politique, London, 1782.—17

[3] According to Bastiat, "the workers' pension fund" was to be made up of contributions by the workers themselves, for thus alone the necessary degree of "stability" could be ensured (Fr. Bastiat, Harmonies économiques, 2nd edition, Paris, 1851, p. 395).—11

[41] James Steuart distinguishes between "agriculture exercised as a trade" and "agriculture exercised as a direct means of subsisting" (An Inquiry into the Principles of Political Oeconomy, Vol. I, Dublin, 1770, p. 88).—106

[5] The "supreme being" {être suprême) was Voltaire's designation of God, whom he, in contrast to the positive religions, described as an impersonal rational creator, who, having, laid down the laws of the world and given it an initial impulse, has refrained from any further intervention in the natural course of events.—13

[2] This refers to Chapter XIV in the second edition of Bastiat's book Harmonies économiques (there are 25 chapters in that edition). Since this section of the draft "Bastiat and Carey" begins on page 5 of the manuscript, while half of page 4 was left blank, it may be assumed that Marx originally intended to discuss Bastiat's book in greater detail, giving, in particular, an account of the preceding 13 chapters.—11

[6] This Introduction, prefaced by Marx to the Outlines of the Critique of Political Economy, the first rough draft of Capital, holds an important place among his Economic Manuscripts of 1857-58. It is contained in Notebook M, marked "London, 23 August '57", which is probably the day when Marx began writing the Introduction. He interrupted this work, in all likelihood, in the last days of August, leaving the Introduction unfinished. On the cover of Notebook M, Marx listed the main items to be discussed in the Introduction. The headings of the individual sections in this table of contents differ somewhat from the corresponding headings in the text proper. Marx's list is as follows: "Contents "A. Introduction "1) Production in general "2) General relationship between production, distribution, exchange and consumption "3) The method of political economy "4) The means (forces) of production and production relations; production relations and relations of intercourse, etc." As the table reflects the overall structure of the Introduction more accurately than the headings of some of the sections in the text do, one may assume that Marx wrote it after drafting the Introduction. The fourth, closing section is in the form of a detailed outline. Of the subsections listed in it, only subsection 1, containing Marx's views on art, was written, and even that not in full. For instance contrary to his original intention, he did not investigate the relation of Shakespeare to the modern world. Having put to paper his views on Greek art, Marx broke off the work on the Introduction. Later, when preparing the manuscripts for publication, he abandoned his intention to open them with an extensive introduction and confined himself to a shorter preface formulating in brief the general philosophical premisses of his method of economic research (the materialist conception of history). In the Preface to Part One of A Contribution to the Critique of Political Economy, dated January 1859, Marx wrote: "A general introduction, which I had drafted, is omitted, since on further consideration it seems to me confusing to anticipate results which still have to be substantiated, and the reader who really wishes to follow me will have to decide to advance from the particular to the general" (see present edition, Vol. 29). The Introduction was first published in the journal Die Neue Zeit, Vol. 1, Nos. 23-25, Stuttgart, 1902-1903. In English, in first appeared in A Contribution to the Critique of Political Economy by Karl Marx. Translated from the second German edition by N. I. Stone. With an appendix containing Marx's Introduction to the Critique recently published among his posthumous papers. Charles H. Kirr & Company, Chicago, 1904, pp. 265-312. It was also published in Marx and Modern Economics, ed. by D. Horowitz. Mac Gibbon & Kee, London, 1968, pp. 21-48, in Marx's Grundrisse by David McLellan, Macmillan Press Ltd., London, 1971, pp. 16-46, and in Karl Marx, Grundrisse. Translated with a Foreword by Martin Nicolaus. London, 1973, pp. 81-111.—17

[10] In subsequent years Marx modified his views on family relations in primitive society and the early tribal system in accordance with the latest studies in ethnography and ancient history, notably the books Das Mutterrecht by the Swiss historian Johann Jacob Bachofen and Society by the American Ancient anthropologist Lewis Henry Morgan, published in the 1860s and 1870s. In particular, he abandoned the view, commonly held by historians in the 1840s and 1850s, asserting the primacy of the family and the secondary nature of the tribe and deriving the tribe from the developing family. The new conception of the relation between tribe and family was reflected, in particular, in Marx's synopsis of Morgan's Ancient Society. Frederick Engels drew on this book in writing The Origin of the Family, Private Property and the State.—18

[4] Marx means the philosophical and historical constructions in Proudhon's book Système des contradictions économiques, ou Philosophie de la misère (Paris, 1846). In 1847 Marx attacked them in The Poverty of Philosophy. Answer to the "Philosophy of Poverty" by M. Proudhon (see present edition, Vol. 6, pp. 105-212, particularly pp. 111-15 and 157-60).—13

[150] Marx means his Manchester notebook of excerpts of 1845.—504, 534

[152] Marx is referring to his Paris notebook of 1844.—529, 534