THE

NATURE

AND

SIGNIfICANCE

CLASSICAL

OF'

POLITICAL

MARX'S

CRIT lQUE

or

ECONOMY

Geoffrey Pilling

This thesis is submitted to the Council for National

Academic Awards in partial fulfilment of the requirements
for the degree of PhD

Sponsoring Establishment : Kingston Polytechnic

r.

f.

,,-r

September 1983

..~"'-':' ;' ,.'\'

"

A B S T R ACT

Geoffrey Pilling

THE NATURE AND SIGNIfICANCE Of MARX'S CRITIQUE

Of CLASSICAL POLITICAL ECONOMY

The thesis is concerned with a series of methodological aspects of

Karl Marx's economic writings, notably Capital. These methodological questions are explored by means of a critical review of
Marx's relationship to the school of classical political economy
in Britain. Here emphasiS is placed on David Ricardo. The aim of
the thesis is to demonstrate that it is impossible to understand
fully the revolution wrought by Marx in the field of political
economy without having fundamental regard for the philosophical
foundation of Marx's Capital. It is argued that Hegel is above
all the key figure here and that a proper consideration of the
influence of his philosophy in shaping Marx's intellectual development is of paramount importance. After an initial survey in which
it is held that these matters have received little adequate
attention in the past, attention is directed towards the major
elements of Marx's critique of classical economics. Stress is
placed on the empiricism which underlay much of this political
economy and the consequences which this philosophical stance
involved. To develop the argument, Marx's notion of labour is
examined in detail. A more generel analysis of the concepts
employed by Marx in his work follows, designed to demonstrate
concretely the fundamental natura of Marx's critique of the work of
his predecessors. The opening chapters of Capital are subjected to
a close textual scrutiny in order to highlight the dialectical
character of Marx's work. finally the nature of the notion of
fetishism is explored with a view to establishing its centrality for
Marx as well as to explain its absence from the work of the
classical economists.

PRE f ACE

Aspects of this thesis formed the basis for papers read at Staff
Seminars in Middlesex and Kingston Polytechnics, 1981-2.

In

connection with the programme of research undertaken for this

thesis, I attended the Annual Meeting of the Conference of Socialist
Economists in 1981 and 1982.

I must thank the School of Economics,

Middlesex Polytechnic, for financial support for these visits.

CONTENTS

Page No
Abstract

Preface

:5

Abbreviations

Chapter 1

Introduction to the Themes of the

Thesis

Chapter 2

Marx's Critique of Classical Economics

6
27

(I)

Chapter :5

Marx's Critique of Classical Economics

(II )

Chapter 4

The Conceptual Basis of Marx's

, Capital'

106

Chapter 5

The Significance of the Opening

Chapters of 'Capital'

152

Chapter 6

Marx's Notion of Commodity fetishism

and the Critique of Classical Economics

192

Chapter 7

Conclusions

240

69

Notes

253

Bibliography of Works Consulted

264

Aopendix 'The Law of Value in Ricardo and Marx'

268

A 8 8 REV I A T ION 5

The following abbreviations have been used throughout the thesis:

I

Capital, Vol 1, Lawrence & Wishart, 1961.

II

Capital, Vol 2, Lawrence & Wishart, 1957.

III

Capital, Vol 3, Lawrence & Wishart, 1959.

1

Theories of Surplus Value, Part 1, Lawrence & Wishart,

1969.

Th 2

Theories of Surplus Value, Part 2, Lawrence & Wishart,

1971.

Th 3

Theories of Surplus Value. Part 3. Lawrence & Wishart,

1972.

Critique

Critique of Political Economy, Lawrence & Wishart,

1971.

Grundrisse, Penguin Books, 1973.

Lew

The Collected Works of Lenin (in 50 Vols),

Lawrence & Wishart.

SC

Marx & Engels, Selected Correspondence,

Lawrence & Wishart, 1956.

Th

Chapter 1
INTRODUCTION TO THE THEMES OF THE THESIS
This thesis is concerned with certain aspects of the relationship
between Marx's economic writings and those of classical polieical
economy_

This relationship is explored with a definite intention:

to raise a number of issues about the methodological and

philosophical positions from which Marx investigated economic
processes and phenomena.

It is one of the central contentions of

the thesis that those who have been concerned with Marx's
critique of political economy have paid insufficient attention to
the philosophical dimensions of Marx's writings in the area of
'economics'.

And this neglect of the philosophical underpinnings

of Capital and Marx's other writings in this field has, it is

suggested, taken an even more specific form, namely a neglect of
the real significance of the relationship between

Hegel and Marx.

In one of his last writings, George Lukacs dealt with the effects
of the recently fashionable efforts to distinguish between the
'Young Marx' and the 'later' Marx of Capital.

What he says has

considerable bearing upon the approach taken to this latter work.

Lukacs says at one point
"Marx never put forward an express claim to have created
a specific philosophical system. In the 1840s, Marx
struggled in philosophy against the idealism of Hegel
and particularly against the radicalism of Hegel's
pupils, which was becoming ever more subjective. After
the interruption of the 1848 revolution, the foundation
of a science of economics came to form the focal point
of his work. Many who esteem his early philosophical
writings of the 1840s draw the conclusion from this that
Marx turned away from philosophy and became 'simply' an
economic specialist."1

This, claims Lukacs, would be a very 'hasty conclusion' for

"It is based purely on external criteria, on the dominant
methodology of the second half of the nineteenth centcry,
which decreed a mechanically rigid opposion between
philosophy and the various positive sCiences, and hence
degraded philosophy itself, by way of its exclusive
foundation in logic and epistemology, to a specific
science. from a standpoint of this kind, bourgeois
science and the modes of thought influenced by it, even
among supporters of Marxism, came to see the economics of
the mature Marx as a specific science i2 contrast to the
philosophical tendencies of his youth."
And Lukacs goes on to claim that Marx's work in Capital and
elsewhere cannot properly be construed as 'economics' in the
traditional sense
"as simply one specific science: this conception isolated
so-called phenomena of pure economics from the total
inter-relations of social being as a whole, and analysed
these in an artificial way that - in principle - allows
an area thus elaborated to be artificially isolated (law,
sociology, etc.) whereas Marx's economics always starts
from the totality of social being and always flows back
into it." 3
This same point is made by another recent writer;

although his main

concern is with certain tendencies in contemporary sociological

theory his remarks apply equally for a correct conception of the
relation of Marx's 'economics' to his work as a whole:
"Marxism is not a 'sociology'. It only appears to be so,
because, from the point of view of every other particular
section of the intellectual division of labour
philosophy,
economics, history of ideas, etc. - Marxism goes beyond
their defined subject matter, insisting that the real
content of each of them is to be found in the contradictory
totality of social economic relations from which flow the
forms of activity and thought to which the separate
disciplines address themselves."4
And this same writer proceeds to speak specifically of the case of
political economy which
"is 'negated' by Marxism in the Hegelian sense. Marx's
treatment of political economy takes to their limit the
contradictory developments of classical political economy.
To do this requires the explanation of political economy's
concepts and their real content as the 'alienated'
7

consciousness of the development of bourgeois society

itself. Thus we find in the Critique of Political Economy
and in Capital a negation of political economy, which is
demonstrated as being an adequate reflection of the sphere
of exchange values and their behaviour. But this sphere is
shown to be the real world of appearances or illusions as
necessarily created by an historically limited social order,
capi tali am. "S
It was of course Lenin who designated English classical economics as
one of the three sources and three component parts of Marxism, the
others being claSSical German philosophy (especially from Kant through
to Hegel) and rrench socialism.

But it is clear that Lenin did not

wish to imply that Marxism continued to be composed of three separate

strands, a Marxist 'economics', a Marxist 'philosophy' and a Marxist
politics'.

Indeed, a study of Lenin1s work would, I believe,

a diametrically opposed tendency in his thought:

on the organic unity of Marx's thought.

reveal

one which insisted

Thus in Materialism and

Empirio-Criticism Lenin opposed all those, notably Bogdanov, who

believed that one could still be a Marxist in connection with the
study of society (historical materialism) while at the same time
rejecting the philosophical 'aspects' of the Marxist Joctrine
(philosophical materialism).

Lenin says, on this question:

"Materialism in general recognises objectively real being (matter)

as independent of consciousness, sensation, experience, etc., of
humanity. Historical materialism recognises social being as
independent of the social consciousness of humanity. In both
cases consciousness is only a reflection of being.... rrom this
Marxist philosophy, which is cast from a single piece of steel,
you cannot eliminate one basic premise, one essential part,
without departing from objective truth, without falling a prey to
bourgeois-reactionary falsehood." (LeW, 14, 326).
Plekhanov, writing at roughly the same time as Lenin, was equally
insistent on the integral nature of Marxism and the impossibility of
breaking it up into discrete bits - into economics, politics,

sociology, etc.

This is how Plekhanov opens his Fundamental Problems

of Marxism.
"Marxism is an integral world-outlook The historical and
economic aspects of this world-outlook, i.e. what is known as
historical materialism and the closely related sum of views
of the tasks, method and categories of political economy, and
on the economic development of society, are in their fundamentals almost entirely the work of Marx and Engels That
is why the term 'Marxism' is used to signify only those two
aspects of the present-day materialist world outlook not only
amongst the 'general public' but even among people, both in
Russia and the entire civilised world, who consider themselves
faithful followers of Marx and Engels. In such cases these
two aspects are looked upon as something independent of
'philosophical materialism', and at times as something almost
opposed to it."6
The particular issue which concerned both Lenin and Plekhanov in the
works from which we have quoted - the efforts on the part of certain
Marxists such as Bogdanov to create a 'new philosophy' based upon the
positivism of Ernst Mach and others - will not detain us.

But what

both Lenin and Plekhanov say about the efforts to separate rigidly the
philosophy of Marxism from those 'aspects' which are ostensibly
concerned with the study of society and its historical development are
important for the general orientation of this thesis.

For the tendency

to which they were drawing attention - and especially the form it takes
as the effort to separate out Marx's political economy from the
philosophical foundations of Marxism as a whole - would still appear
to predominate.
The main interest in what follows will not lie in tracing the historical
development of this tendency to treat Marxism in this fashion;

our

chief focus of interest will lie in an examination of Capital in an

~~

effort to show that it can be graspedLif it is seen to be as much a work

of philosophy as a work of political economy

But it will be

useful in this introduction to draw attention to certain features in

the development of Marxism which have some bearing on the problem.
Of course no attempt at completion or even less of originality is
made for this historical sketch.
During the period of the Second International (that is prior to its
collapse in 1914) there is little doubt that the main source for the
fragmentation of Marxism and its tendency to reflect uncritically
the intellectual division of labour then being established in orthodox
social science

(economics~

sociology, political science,

history of ideas, etc.) came from the influence of neo-Kantianism and

the implicit (often explicit) rejection of any concern for Hegel which
the 'return to Kant' implied.

Leaving the details aside as things

which do not centrally concern us, it is clear that this Kantian (or
more strictly neo-Kantian) influence tended to take Marxism in the
direction of mechanical materialism, a tendency noted by many
commentators, although their explanations for the tendency differ
widely.

That the influence of neo-Kantianism should take Marxism in

the direction of a mechanical materialism was almost inevitable given

the fact that Kantianism was founded upon the notion that nature (wherein
lay the realm of necessity) was to be kept rigidly apart from society
(wherein lay the realm of freedom).
This mechanical distortion of materialism and the relative neglect of
Hegel (it would not be untrue to say that of all the leaders of the
Second International only Lenin and Plekhanov had a deep knowledge of
Hegel's philosophy and its implications for Marxism) which was so
evidenced in the Second International was, it is commonly accepted, a
distortion which reappeared in the Marxism predominant in the Soviet
10

Union from the late 1920s onwards. Again the roots of this phenomena
are a matter beyond investigation in the present thesis but it is
particularly noteworthy that the orthodoxy which prevailed in the
USSR during the 1930s and continued dawn to the 1950s was associated
with a renewed attack an Hegel, who in extreme cases was dismissed
as merely a product of the aristocratic reaction to the french
Revolution of 1789.

It is warth noting that in his famous article

'On the Significance of Militant Materialism' (LeW 33) written in

connection with the launching of the journal Under the Banner of
Marxism in 1922 Lenin had proposed a programme of work between
scientists working in 'various fields and those philosophers aiming to
develop and enrich dialectics;

he in fact called for the establish-

ment of a kind of 'Society of Militant friends of the Hege~~

Dialectics'.

fallowing Lenin's lead there was indeed a lively debate

in the 1920s an problems of Marxist philosophy and its relationship

to the natural and the social sciences.

In particular there was a

lang-drawn out struggle between the 'mechanists' and the 'dialecticians' before the debate was summarily brought to an end in 1931 with
the condemnation of A M Oeborin and the ather 'dialecticians' who were
accused of blurring the distinction between Marx and Hegel.

It is nat

possible to assess these debates - if only because much of the

material is still not yet available, at least in English - but one
result seems clear.

Lenin's project - to carry out a systematic study

of Hegelian dialectics from the standpoint of materialism - was pushed

into the background. 7
We have here sketched aut developments which occured within the Soviet
Union.

But given the position of the Soviet Communist Party within

11

the international movement, these developments were bound to have a

serious impact - and in the view of the present writer a harmful
effect - on the development of Marxism in the West, including Britain.
It would perhaps be fair to say that these developments occuring in
the USSR tended to re-inforce the inclination amongst British
Marxists - including those engaged within the field of political
economy - to conceive Marxism in mechanical and deterministic terms.
Inhis recent detailed study A Proletarian Science: Marxism in Britain

1917~1933e Stuart Macintyre has much to say of interest about the

development of Marxism in Britain in the period following the Russian
Revolution, including some comments on the treatment of political
economy amongst English Marxists during this period.

He underlines

what has been almost the conventional wisdom about British Marxism
that it has always been deficient in the philosophical sphere,
displaying the same empirical and metaphysical bent as the national
culture.

As he further notes, Hegelinaism did make a certain impact

in British academic philosophy at the end of the last century,

producing a school associated with the work of T H Green and
Bernard Bosanquet.

Apart from the fact that it was based upon a very

definite many would say one-sided reading of Hegel, it was a school

which made little impact within socialist circles, where it might have
been expected to influence Marxism.

With the exception perhaps of

Belfort Sax nineteenth and early twentieth century Marxism remained

blissfully unaware or disinterested in the importance of Hegel's
dialectical idealism in the formation of Marx's views and indeed there
was a deep suspiCion of the entire notion of 'dialectics' amongst the
great majority of Marxists in Britain, as Macintyre records in detail.

12

The principal source for those who were interested in philosophical

materialism as a whole or who, on a narrower plane, showed any
inclination to concern themselves with
Joseph Dietzgen.

dialectics~

was the work of

Indeed, the criticisms of his work made by Lenin

and Plekhanov notwithstanding, many of those in Britain interested

in philosophy tended to regard his work more highly than that of
Marx and Engels themselves. 9

It is true that Dietzgen's influence

began to wane somewhat after 1917 but from this point onwards it was
replaced by those influences emanating from the Soviet Union to which
we have already referred.
In fairness to those attempting to develop Marxism at that period, it
should be pointed out that many of the major works of Marx, and
especially those which can be said to have an explicitly philosophical
character, were not as yet available in English translation.

This was

true of the 'Paris Manuscripts' where the relationship of Marx's

critique of Hegelian idealism and his growing interest in the critique
of economics is particularly clear:
until as recently as 1960.

these did not appear in English

Engels' Dialectics of Nature which clearly

has much to say about the dialectical method and the limitations of
English empiricism was not available until 1940.

As far as Lenin is

concerned, although Materialism and Empirio-Criticism was available in

English from 1927 onwards (with an important introduction by Deborin
stressing the dialectical character of the materialism which Lenin was
defending in that work - this was withdrawn in the next and subsequent
editions) Lenin's 'Philosophical Notebooks' did not appear in English
until 1960.

This was a particularly important gap in the literature

given that in these notes - based upon a new study of Hegel's work

13

which Lenin undertook after 1914 - Lenin made several important and
explicit references to Marx's Capital and the importance, as he saw
it, of a proper study of Hegel's Logic in connection with this work.
In the case of the 'economic aspects' of Marx's work things stood
somewhat better than in the case of philosophy for many of Marx's
major and lesser works were available in this area.

Even here however

there were significant gaps, amongst them the Grundlsse which remained
almost unknown to Marxists in this country (and many other countries
for that matter) and did not appear in anything like a complete form
until the edition of 1973.

Here again was a significant gap given

that the Grundisse has been widely seen as much more explicitly
~

'philosophical' than the later Capital and much more Heglian in its
language and categories
As Macintyre's study notes, great emphasis was traditionally placed
upon the teaching of Marx's

'economics' amongst socialist activists

in the pre-war period and it was a tradition which survived in the

1920s and beyond.

But it is clear from his account that the apprecia-

tion of Marx's Capital was of a severely limited character.

In the

first place most of the teaching of and writing about political

economy by Marxists was carried out by auto-didacts (Noah Ablett from
south Wales was perhaps typical here) who had little opportunity and
perhaps little inclination to consider the wider aspects of Marx's
critique of political economy.

Second, and perhaps flowing from these

factors, concentration was placed almost exclusively upon the first

volume of Capital where the doctrine of surplus value was accorded
pride of place.

In the tradition established in this period the

critique of capitalism was presented, according to the account given

14

by Macintyre, as an illumination of the extraction of surplus value

from the worker rather than as a dynamic analysis of the capitalist
system and its contradictions.

It is noteworthy that this version of

Marx's critique of capitalism encountered considerable difficulties

when it was faced with more abstract, theoretical problems such as
the 'great contradiction' between the first and third volumes of
Capital which Bohm-Bawerk claimed to have uncovered at the end of the
last century.

Those who held that the essence of Marx's Capital lay

in its demonstration of the exploitation of the working class also

had problems when confronted with the charge that Marx believed in
the inexorable immiserization of the working class or even that he
held to the 'iron law' of wages theory.
It was against this background that the leading commentator on Marx's
Capital throughout the inter-war period and for long into the postwar years, Maurice Oobb, emerged.

Oobb occupied a unique position

as the only Communist to hold an academic post in the 1920s and it

was through the work of Dobb that the impact of Marxism on the
academic study of economics can be felt.

An important contribution in

this respect was the close attention which Dobb gave in a series of
works to the relationship of classical political economy to that of
Marx.

He aimed to show that not only did Marx draw upon the classical

tradition, Ricardo especially, but that this tradition stood on an

immeasurably higher theoretical level than the neo-classical
tradition which was destined to replace it.

His Political Economy and

Capitalism first appearing in 193710 can be said to mark the beginning

of this long, often no doubt lonely, endeavour to rescue classical
political economy from the almost total neglect into which it had

15

fallen at the hands of the orthodox economics community;

its high

point was reached with the definitive edition of the Collected Works
of Ricardo, in the editorship of which Cobb collaborated with
Piero Sraffa.
One interesting feature of Macintyre's work is the fact that he
reveals that Dobb's early work in the 1920s met with considerable
criticism (much of it evidently ill-informed) which suggested that
it had made serious concessions to orthodox economics.

In some ways

he was never free of such criticisms for in the 1970s he was also
accused by a number of writers, this one included, of presenting
Marx's critique of capitalism in a manner which did not sufficiently
distinguish it from Ricardo's analysis.
One of the major concerns of this thesis will be an examination of
the relationship of Marx's work to that of Ricardo.

It is the

contention of the present writer that this relationship has in

several respects been misconstrued by many Marxists, Cobb included.
It will be suggested that involved here are a series of methodological
and philosophical matters which Marxism in general and particularly
Marxism in Britain have tended to ignore.

It should be stressed

that these weaknesses are not seen as a reflection of individual

problems;

they emerged out of the cultural and intellectual climate

sketched out above and which had the effect of viewing Marx's
critique of political economy as a discrete area of concern, separate
from the rest of his work and particularly separated from Marx's
philosophical standpOint.
Certain recent work has, I believe, laid the foundation for overcoming

16

, the difficulties and problems into which the sort of view defended
by Maurice Dobb and others led.

It will be useful to refer to this

work in a preliminary manner, although it will receive more specific

attention in the body of the thesis.
Roman Rosdolsky's The Making of Marx's Capital unlike many other
works devoted to Marx's critique of political economy places at its
centre a concern for methodological questions.

About these questions

the author says the following:

"Of all the problems in Marx's economic theory the most
neglected has been that of his method, both in general
and specifically in its relation to Hegel. Recent works
contain for the most part platitudes Which to echo Marx's
own words betray the author's 'own crude obsession with
the material' and total indifference to Marx's method.11
And this same author proceeds to say about those who have traditionally
been concerned with Marx's method
"What would one make of a psychologist who was interested only
in freud's results, but rejected the question of the manner
in which freud obtained these results as being irrelevant or
even 'metaphysical'? One could only shrug one's shoulders.
But this is precisely how most present day critics of and
'experts' on Marx judge his economic eystem. Either they
totally refuse to discuss his dialectical method because they
are opposed to 'metaphysics' or the critique is restricted
to a few platitudes better left unsaid.12
The significance of Rosdolsky's work cannot, we believe, be restricted to those topics which engaged his attention.

Some of them - such

as the distinction on which he concentrates between 'many capitals'

and 'capital in general' - are certainly of considerable importance
and enable him to throw much light on Marx's critique of political
economy.

But the real merit of the work lies in the fact that

Rosdolsky has consciously aimed to re-introduce a proper consideration of Hegel's philosophy into the study of Marx's economic theory.
He on more than one occasion refers to the dialectic as the 'soul'
17

of Capital and there seems little doubt that his work was directly
inspired by Lenin's own comments on the significance of Hegel's
Science of Logic for the study of Marx's Capital.

Lenin's comments

will also concern us at various points in this thesis and here a

general point is made about them.

Lenin was never content, in his

analysis of the degeneration of the Second International, merely to

trace its roots to the socio-economic conditions that arose with the
advent of imperialism.

Lenin in many respects went beyond this in

that he sought to probe the theoretical and philosophical method

employed by Kautsky and others.

This work was antiCipated in

Materialism and Empirio-Criticism (1908) but above all the 'Philosophical Notebooks' of the war period itself.

In both these works

Lenin was obliged to take up the baleful influences of the philOsophy of neo-Kantinaism to which large sections of the International
had fallen victim.

Lenin did not rest content with reasserting what

he took to be the truths of Marxism and showing that revisionism had

abandoned these truths.

Lenin felt obliged to go 'back to Hegel'

just as his opponents were, in the main, forced 'back to Kant'.

As

is well known, this critical re-examination of Hegel culminates in a

sharp renunciation of the former 'Marxism' which had first compromised
with and then capitulated to Kantianism:

'It is impossible to under-

stand Marx's Caoital and especially its first chapter without having
throughly studied and understood the whole of Hegel's LogiC.

Con-

sequently half a century later, none of the Marxists understood

Marx.' (LCW 38, 180).
It is the contention of the present thesis that Lenin's statement
carries the following implications: it is necessary to rework Capital

18

thoroughly always keeping Hegel in mind and only if this is done will
it be possible to deepen our understanding of Marx's method which
underpinned his entire critique of political economy.

It is further

contended that it is only on the basis of this kind of re-examination

that many of the attempts currently being made to revise the basic
categories of Marxian political economy can be adeqately appraised.
It is the first task - or rather certain aspects of it - which will
principally occupy us, although some brief mention is made of this
latter question.
This thesis can be only a small attempt at a re-examination of Marx's
method, as it is exemplified in his critique of political economy.
We have mentioned some of the weaknesses which have attended previous
work in this area, weaknesses, it has been suggested which grew out
of definite historical and cultural conditions.

It seems clear that

many of these past difficulties no longer exist, certainly not in the

same form, nor with the same degree of force.

An example of important

changes taking place in the approach to Marx's Capital can be seen in

the Soviet Union and eastern Europe.

After a long period in which an

interest 1n Hegel was at best discouraged and at worst condemned, the

period from the mid-1950s onwards witnessed a renewed interest in
German philosophy and its implications for an understanding of Marxism.
A case in point is provided by the work of the late E V Ilyenkov whose
work Dialectical Logic: Essays on its History and Theory (English
translation 1977) although concentrating on a number of themes in the
history of philosophy has much to say about Capital as well as about
the limitations of the empirical method of classical political economy.
This same writer has written specifically about certain concepts in

19

Capital in a manner which suggests that there is now a conscious

attempt to overcome the mechanical distortions of Marxism which
characterised much Soviet work from the late twenties onwards.

We

shall refer specifically to the nature of Ilyenkov's work at

appropriate stages of the thesis.

Mention at this point can also

be made of Jindrich Zeleny's The Logic of Marx (English transletion

1980) which deals with a number of problems in Marx's philosophical
method from the standpoint of his relationship to classical
political economy.

finally, in rehearsing those theoretical sources

to which the thesis is particularly indebted, mention must be made

of the work of I I Rubin whose Essays in the Labour Theory of Value
first written in the 1920s but unaveilable in English for over fifty
years is an outstanding instance of a work which attempts to deal
with the philosophical nature of Marx's work in the field of political
economy.
An important theme running through the thesis is that - on the
theoretical level at least - it was the empirical standpoint of political economy which in the last instance prevented it from answering the
questions which it had posed about the nature of capitalist economy
and its laws of motion.

It will thus be useful in this introduction

to make some preliminary remarks of a general nature about the attitude

of Marx and Engels to the philosophy of empiricism.

Urging the

natural scientists of his day to pay specific attention to the

dialectical method, Engels notes that
"the results in which its experiences are summarised are concepts,
that the art of working with concepts is not inborn and also not
given with ordinary everyday consciousness but requires real
thought, and that this thought similarly has a long empirical
history, not more and not less than empirical natural science.
20

Only by learning to assimilate the results of the development of philosophy during the last two-and-a-half thousand
years will it rid itself on the one hand of any natural
philosophy standing apart from it, outside and above it,
and on the other hand also of its own limited method of
13
thought which was its inheritance from English empiricism."
It is clear from this passage that Engels sees in empiricism a
barrier to rational thought.

This same point is made in the Dialectics

of Nature where Engels, after noting that 'empirical natural science

has accumulated such a tremendous mass of positive material for
knowledge' goes on to say that it is necessary to organise this
material and bring the various spheres of knowledge into proper
connection with one another, but
"In doing so however, natural science enters the field of
theory and here the methods of empiricism will not work,
here only theoretical thinking can be of assistance. But
theoretical thinking is an innate quality only as regards
natural quality. This natural capacity must be developed,
improved, and for its improvement there is as yet no other
means than the study of previous philosophy."14
The fact that 'theoretical thinking' (thinking in concepts, that is
to say dialectical thought) had to replace empiriCism was true
notwithstanding the fact that the orientation of English empiricism
as a whole, at least in its early phase (Bacon, Hobbes, Locke) was
to~ards

materialism.

Indeed Engels was prepared to defend, within

limits, the old natural philosophy against the lunphilosophical

theories of the empirical natural SCientists';

for despite the fact

that this philosophy contained la great deal of nonesense and fantasy'

it had however naievely and in however an idealist form attempted to
deal with the problem of the universal iner-connectedness of all
phenomena, a problem which empiricism consigned to the realm of
metaphysics.

It was for this reason that Engels also says 'As far
21

as Hegel is specifically concerned, he is in many respects, head and

shoulders above his empirical contemporarles ,15
Empiricism, in the most general sense, limits knowledge to that
derived from experience.

It was precisely because it was by its very

nature 'unphilosophical', downgrading as it did conceptual knowledge,

that it was rejected by Marx and Engels.
detail in Chapter 4 below.)

(This matter is taken up in

But this rejection of empiricism should

not be misconstrued as a rejection on Marx's part of any concern for

empirical material and its role in the development of knowledge.

As

is well known Marx spent many years in the British Museum and elsewhere collecting-a mass of empirical material as part of his investigation of the capitalise mode of production.

Indeed in connection

with these economic studies Marx says in the 'Paris Manuscripts'

"It is hardly necessary to assure the reader conversant with
political economy that my results have been attained by
means of a wholly empirical analysis based on a conscientious
critical study of political economy."16
Marx took, says Lenin,
"One of the social-economic foundations - the system of
commodity production - and on the basis of a vast mass
of data (which he studied for not less than twenty-five
years) gave a most detailed analysis of the laws
governing the functioning of this formation and its
development."1?
The point here is this.

The claims of empiricism to be an adequate

theory of knowledge (claims which Marxism rejects) should not be

confused with the fact that the material and social world is always
given to man through his sensations;

in other words the development

of all knowledge must, in a certain sense begin from empirically

given material, although it must certainly not stop there.

This

matter is raised here prinCipally because one of the effects of the

22

work of Althusser and his followers (to which reference will be made
at various points) has been to see any concern with empirical
material as a concern with the merely ideological.

To the present

writer this seems a thoroughly false position, one which bears the
imprint of a narrow rationalism.

The work of Althusser will be

examined from this point of view at various stages in the thesis.

It is intended to review a series of methodological issues surrounding Capital by means of a review of Marx's relationship to the
school of classical political economy.

Clearly this is by no means

the only manner in which such a task could be tackled and therefore
a few words of justification for such an approach are perhaps
required.
Marx's attitude to the work of his predecessors in political economy
was a thoroughly dialectical ane.

That is to say Marx clearly

recognises that each shoal in the development of political economy

is in some way connected with the previous history of the subject.
for Marx (the appropriate citations are given in Chapter 1) the
development of political economy was a reflection, in theoretical,
abstract, form of the development of actual economic relations.

This

being the case, it then followed from Marx's standpoint that it is in

principle impossible to understand a particular phase in the development of political economy without analysing all previous (and
contemporary) efforts to understand the same phenomena - even if
these turn out to have been spurious attempts.
Thus it would be a mistake to imagine that the historical path leading
to an adequate investigation of economic phenomena (which is presumably
what the history of political economy is concerned with) is only
23

relevant inasmuch as an adequate (that is scientifically correct)

conception has not been reached.

This is so because political

economy is essentially a deeply controversial subject in which, the

intentions of its practitioners notwithstanding, its doctrines have
often served, adequately or otherwise, as the instrument of various
social forces.

It would be an extremely barren view if one were to

look over the history of political economy, prior to Marx, merely

to seek out its errors.

This was ce.rtainly not Marx's attitude to

the work of his predecessors, as we shall try to demonstrate in what

follows.

Marx did of course claim to discern many errors in classical

political economy;

but he also attempted to explain the sources, both

social and methodological, of these errors;

in a certain sense he

aimed to demonstrate the necessity for these errors in the development of this particular science.

This ambition, we believe, informs

Marx's attitude to the work of his greatest predecessor in political

economy, Ricardo.
this work.

He was aware, at the same time, of the limits of

He also tried to demonstrate the historically transient

nature of these limits - that is to demonstrate, in theory and

practice, the conditions under which these limits could be overcome.
This we believe is the true meaning of Marx's claim to have negated
the greatest achievements of classical political economy.

Marx

neither accepted the results of the classical school uncritically;

nor was he disinterested in the limitations of this school, for it
was only in struggle against these limitations, in the struggle.
against the 'bad sides' of history, as Marx on one occasion put it,
that real progress could be made.
24

This is,

~e

believe the real

meaning and content of negation:

'Not empty negation, not futile negation, not sceptical
negation, vacillation and doubt is characteristic and
essential in dialectics, - which undoubtedly contains
the element of negation and indeed as its most important
element - no, but negation as a moment of connection, as
a moment of development, retaining the positive, i.e.
without any vacillations, without any eclecticism.'

(Lew 38, 226).

Marx's ability to preserve from the classical legacy all that was
positive was founded on his profound grasp of the dialectical
method, a method quite unknown to even the greatest of the classical
political economists.

This, in summary, is the central contention

of the thesis.
The material is organised as follows.

Two chapters are devoted to

an examination of Marx's critique of the classical school designed

to bring out the underlying philosophical conceptions on which that
critique was based.

This leads to a central chapter (Chapter 4)

which deals with the nature of the concepts which Marx employs in
his examination of bourgeois economy.

This leads to a more specific

examination of the nature and significance of the opening chapters

of Capital designed further to illustrate certain methodological
problems.

The notion of fetishism is subjected to a separate

examination (Chapter 5) designed to re-inforce a central theme:

the

unity of the 'economic' and the 'philosophical' in Marx's work.

finally some conclusions are offered by way of summary_

An appendix

(Appendix 1) contains a first attempt, made by the author some years

25

ago to explore some of the issues of the thesis in a preliminary

way.

1B

As the thesis was being completed an important work by V Ilyenkov,

The Dialectics of the Abstract and the Concrete in Marx's 'Capital'
appeared in English translation.

Unfortunately it was not possible

to consider this work and its implications for the central themes of
the thesis within the main body of the text.

But this is clearly a

crucial work in which IlyenKov elaborates and expands on a number of

problems which were only touched on in his other work available in
English translation.

Some consideration of this work is therefore

provided in the Conclusions to the thesis.

26

Chapter

MARX'S CRITIQUE Of CLASSICAL ECONOMICS (1)

It is perhaps hardly necessary to stress that Marx was amongst the
warmest admirers as well as the keenest students of that trend in
economic thought for which he invented the term 'classical political
economy'.

But it is perhaps necessary to recall the fact that Marx

employed this term in a manner radically different from that of

many later writers, in particular Keynes.

By classical political

economy Marx meant to designate that strand in economic thought

originating in france with Boisguillebert (1646-1714) and in Britain
with William Petty (1623-87), a trend which was to reach its high
point with the work of Adam Smith and above all David

Ric~rdo

whose

work, in Marx's opinion 'gave to political economy its final shape'.

It is important to keep this definition in view if only because the
term 'classical economics' has often been deployed in a much broader
sense;

in Keynes' case, for instance, it was a school embracing all

those who, following Ricardo, subscribed to one version or another

of 'Say's Law', who believed, that is, in the quasi-automatic selfregulating nature of capitalist economy.

On such a definition

classical economics was to culminate with the work of Marshall and

Pigou.

In an often quoted passage, Marx offered his characterization of

classical economics and differentiated it sharply from vulgar
political economy:
"Once for all I may here state, that by Classical Political
Economy, I understand that economy which, since the time of
W Petty, has investigated the real relations of production
in bourgeois SOCiety, in contradistinction to vulgar economy,
27

which deals with appearances only, ruminates without ceasing

on materials long since provided by scientific economy, and
there seeks plausible explanations of the most obtrusive
phenomena, for bourgeois daily use, but for the rest, confines
itself to systematising in a pedantic way, and proclaiming for
everlasting truths, the trite ideas held by the self-complacent
bourgeoisie with regard to their own world, to them the best
of all possible worlds."
Marx was always conscious of the enduring achievements of the
classical economists, especially when contrasted with the work of
the 'vulgar school', a school which first emerged to a position of
dominance in the period immediately following Ricardo's death.

In

Marx's estimation, classical political economy constituted a

decisive stage in the investigation of the capitalist mode of
production.

Marx sees this stage coming to an end in the period

around 1830, an end in his view intimately bound up with the

emergence of a new social and political force, the working class,
increasingly conscious of itself.

Marx did not of course wish to

imply that in a somewhat mystical manner the working class was

responsible for the 'killing' of a scientific political economy.
Rather he wished to stress that certain basic methodological
limitations of classical political economy increasingly paralysed
it in the face of the emergence of this new phenomenon.
In this connection it is perhaps necessary to stress that Marx's
considerable respect for the achievements of classical economics
notWithstanding, we should not ignore the fact that he saw in the
work of this school a series of weaknesses which were in the final
analysis to prove fatal.

Many commentators especially Professor Meek

have stressed the increasingly ideological and political considerations which inspired the attack on Ricardian political economy
after 1830, an attack which was certainly sharpened by the fact that
28

a trend within the working class movement (which for convenience may
be placed under the rubric of 'Ricardian Socialism'r tried
consciously to deploy Ricardian theory as a weapon against the
capitalist order. 2

While these factors are of undoubted importance

in explaining the relatively rapid disintegration of Ricardian

economics in the years after 1830, it is also equally true that the
opponents of Ricardo were able to seize upon real, unresolved, contradictions within the Ricardian system.

In what follows it is on

this aspect of the problem that the main concentration will be

placed.
In considering the deficiencies of Ricardo's work - deficiencies
which had rendered it susceptible to the sort of attack launched
against it by Samuel Bailey and others - Marx was to focus his
critique of classical political economy on what he considered to be
its decisive weakness - namely its tendency to view society
a-historically, or to put the matter more concretely, its inclinations to treat the capitalist economy as the final form of economy,
as one working directly in accordance with the laws of nature.

All

Marx's detailed criticisms of political economy's inadequate

conceptions of value, money, capital, etc., which are found
throughout Capital and Theories of Surplus Value, rest firmly upon
this, his basic criticism.

It is one stated in The Poverty of

Philosophy though not at that stage fully worked out:

"Economists express the relations of bourgeois production, the
division of labour, credit, money, etc., as fixed immutable,
eternal categories Economists explain how production takes
place in the above mentioned relations, but what they do not
explain is how these relations are produced, that is the
historical movement that gave them birth these categories
are as little eternal as the relations they express. They are
historical and transitory products (emphasis added).,,3
29

The implications of Marx's assertion that the standpoint of classical

political economy was fundamentally an a-historical one deserve
careful consideration.

Some commentators have taken Marx simply to

mean that Smith and Ricardo were either unaware of or disinterested

in pre-capitalist economic forms of production.
seem quite wide off the mark;

This however would

Adam Smith was concerned more than

most to demonstrate the superiority of the capitalist form of production as a means of creating wealth in contrast with feudal
economy.

Others, adopting a slightly different approach, have

assumed that Marx aimed simply to make Ricardo's analysis dynamic,

to 'set in motion' the work of the classical school, as Althusser
at one point puts it.4
Marx,asamaterialist, held that the categories of political economy
were a product of the historical development of the social relations
of production.

In his review of certain aspects of the history of

political economy, Marx at all times insisted on the objectivity of

the categories of the science: 'They are socially valid and therefore
objective thought forms' he writes.

Marx was here stressing a point

which will concern us at various points of this work, namely the

fact that science necessarily develops through definite forms which
stand outside the individual consciousness.

Men of course always

commence, in all spheres of life, with certain definite aims and

motives and the leading figures in political economy were no
exception in this respect.

But the history of political economy

cannot be reduced to the conscious aims and motives of its leading

representatives.

Science develops under determined historical

conditions in that it must always commence its work in and through

the categories which have been historically handed down to it,
30

categories which reflect the work of all previous thinkers in the field
concerned.

Thus, just as Smith's work can be properly understood only

in connection with the achievements of the Physiocrats, so Ricardo's

work was very much an effort to deal with the problems which he thought
Smith's work had left unresolved.
Marx attacked the political economists precisely because they took the
categories of their science uncritically.
look was a-historical amounted to this:

His charge that their outthe political economists

fetishistically accepted the available concepts as fixed and unalterable.

Classical economics took its categories for granted precisely

because it did not know the historical path through which they had been
created.

In short, it fell under the illusion that the relations of

modern economy not only appeared according to the categories of

political economy, but that these relations really were as they
appeared.
Although the 'Young Marx' had not at that stage of his development
worked out in detail his specific criticisms of political economy they were only to appear in detailed form with the publication of
Capital itself - he had, even at this early stage, formed his general
approach to the work of the classical economists and it was this
approach which, in essence, guided his work from that point onwards.
Thus in the Economic and Philosophical Manuscripts (1844) he draws
attention to the fact that the political economists tended to start
from certain premises which they never inquired into:
"We have proceeded from the premises of political economy.
We presupposed private property, the separation of labour,
capital and land, and of wages, profit of capital and rent
of land - likewise division of Labour, competition, the
concept of exchange value, etc. nS
31

And in the next paragraph of these Manuscripts Marx is even more

explicit about the methodological defect which he sees lying at the
heart of political economy:
"Political economy starts with the fact of private property;
it does not explain it to us. It expresses, in general
abstract formulas the material process through which private
property actually passes~ and these formulas it then takes
for~.
It does not comprehend these lews, i.e. it does
not demonstrate how they arise from the very nature of
private property. Political economy throws no light on the
cause of the division between labour and capital, and between
capital and land. When for example, it defines the relationship of wages to profit, it takes the interest of the
capitalist to be the ultimate cause, i.e. it takes for granted
what it is supposed to explain. Similarly, competition comes
in everywhere. It is explained from external circumstances.
As to how these external and apparently accidental circumstances
are but expressions of a necessary course of development,
political economy teaches us nothing. n6
Marx does not object to the concentration which the political
economists placed on the analysiS of private property.

He agrees that

the problems presented by private property must constitute the basis

for political economy.

His objection to the political economists

was they took for granted that which was, in point of fact, in need of
explanation.

Thus, says Marx in these early Manuscripts, when

characterising the relation of wages and profit of capital, economists

tend merely to say that each side (workers and capitalists) seek to
obtain as much as possible for their commodity and drag in 'competition'
to explain the course of this relationship without going to the
objective basis of such competition.

Thus Marx aims to reveal the

methodological premises of bourgeois political economy in accordance

with which the immediate inducements in the capitalist's activity,
i.e. egoism and self-seeking, are the motive forces of capitalist

32

production:

'it takes the interests of the capitalists to be the

ultimate cause, i.e. it takes for granted what it is supposed to

explain'.

As against this approach - the approach of empiricism

Marx formulates his task quite differently:

"Now, therefore, we have to grasp the intrinsic connection
between private property, avarica, the separation of
labour, capital and landed property; the connection of
exchange and competition, etc. - we have to grasp this
whole estrangement connected with the money system."?
In the light of these extracts from his early work it is perhaps
possible to begin to appreciate the central importance which Marx's
investigations into the history of political economy held for his
work as a whole.

Unlike many historians of economic thought Marx

was not interested in the past of the subject in order merely to

find prefigurations for his own ideas.

Indeed the Theories of

Surplus Value was not a history of economic thought in the conventional sense of the term.

It was, as Engels tells us:

"A detailed critical history of the pith and marrow of

Political Economy, the theory of surplus value and develops
parallel with it, in polemics against predecessors, most of
the points later investigated separately in their logical
connection in the manuscripts for Books II and III (Engels,
Preface to II)".
By 'critique', Engels here means that the categories of political
economy had to be investigated from the point of view of revealing
the contradictory nature of the concepts which the political economists
had developed and at the same time revealing how these contradictions
had been resolved.

This was a task which could only be accomplished

by one who was aware that the categories of political economy were the
product of definite sOCial relations and could not therefore be
accepted as timeless, unproblematic categories.
33

To make this matter more concrete we may take the specific example
of the law of value.

At one point Marx draws attention to the fact

that for thousands of years - ever since the first appearance of

commodity production in the ancient world - men had striven to
discover the nature of value.

It was only in the eighteenth century

that they were able - in the shape of political economy - to make

significant progress along this road.

And this progress was made

possible only because of the social conditions in which political

economy operated during that century - the fact that commodity
production was becoming predominant - made possible the clarification of issues which previously, of necessity, had remained obscure.
Now when Marx criticised the political economists for the a-historical
nature of their work, he meant that they could not grasp that their
own science had emerged and developed only under these determinate
conditions.

Political economy laboured under the misapprehension

that the categories of its subject (value, capital, money, labour,

etc.) were not only the product of merely individual minds but that
the laws which these
for all epochs.

mi~Js

had (inexplicably) discovered were valid

They conflated the laws specific to a definite mode

of production with laws which they thought to be universally valid;

they confused social with natural law.

Here lies the clue to

political economy's fondness for the parable of Robinson Crusoe.

Marx objected to such parables because of their sheer artificiality
and because the eighteenth century individual was in fact projected
back into history.

The individual was not conceived as developing

through definite social relations but as posited once and for all
by nature.
34

Do not let us go back to a fictitios primordial condition as

"the political economist does when he tries to explain.
Such primordial condition explains nothing; it merely
pushes the question away into a grey nebulous distance.
The economist assumes in the form of a fact of an event,
what he is supposed to deduce - namely, the necessary
relationship between two things - between, for example,
division of labour and exchange. Thus the theologian
explains the origin of evil by the fall of man; that
is, he assumes as a fact, in historical form, what has
to be explained. ne
It will be useful at this point to provide a brief sketch of the
main stages in the development of political economy, along the
lines provided by Marx in Theories of Surplus Value.

As we have

already suggested Marx did not aim to provide a comprehensive

history of political economy;

his purpose, in reviewing the work

of his predecessors, was first to deal with their work in the

area which he considered most vital, namely their analyses of
value and surplus value and secondly, by dealing with the decisive
turning of 'nodal' pOints in the theoretical elaboration of these
two categories, to sUbstantiate his general proposition that the
categories of political economy were the product of the development of definite social conditions which existed independently of
the thinkers concerned.

In other words, Marx's work in the

history of political economy was inspired by the general orientation

provided by the materialist conception of history.
for Marx, as is well known, Physiocracy was the first genuine
school in the history of political economy.

It consisted of a group

of writers all of whom sought to provide a critical analYSis of

Mercantilism, a system which had imagined that value and its
magnitude resulted from exchange or 'upon alienation' as the
35

Mercantilists had expressed it.

Against this viewpoint the

Physiocrats counterposed the notion that forms of production were

physiological forms arising from the necessities of production
and independent of will and politics.

They thereby turned the

attention of economics towards the study of the social conditions

of production.

for Marx, the decisive weakness of this school lay

in the fact that this production was seen only in its immediate
concrete form;

for according to Quesnay and his followers labour

on the land was alone productive of value, a conception which to

some extent persists with Smith, although in the case of the latter
it occupies a subordinate place in his overall conception.

This

narrowness in the Physiocratic view was, as Marx saw it, a

reflection of the then limited stage reached in the development of
eighteenth-century french economy, which remained one predominantly
based an agriculture.

Despite this limitation, the work of the

Physiocratic school nonetheless constituted for Marx a decisive

step forward for all the work that was to follow in the investigation of capitalist economy.

This was the case because the source

of all the major contradictions in the Physiocratic system stemmed

from its efforts to analyse feudalism from a conSistently bourgeois
standpOint.
When Marx turns to deal with the work of Adam Smith, he once more
stresses the fact that the advances which are associated with his
work stem from the fact that he was writing in a period which saw
decisive changes in the structure of economic relations.

The

Physiocrats had been able to begin the investigation of surplus

value - the difference between the value of labour power
36

and~e

value created by it - only because it appears most palpably within

the sphere of agriculture, the primary branch of production.

The

total means of subsistence consumed by the labourer is smaller than

the total means of subsistence he produces.

In manufacturing

however - which was emerging much more rapidly in Britain than in

france in the latter half of the eighteenth century - the matter
was not as simple.

for in the case of manufacturing the worker does

not produce directly his own means of sUbsistence nor therefore an

excess of them.

Under the system of manufacturing the process is an

indirect one, a mediated one, a process operating through various

acts of circulation of all commodities within the capitalist system.
The development of the value concept - in Marx's estimation the most
important single contribution made by Smith to the development of
political economy - was an expression of this indirect mediated form
of production within the capitalist system.

The fact that the

value concept is not found in Physiocracy was an indication of the

fact that the school developed under conditions where economic
relations were still palpable.
of surplus value;

This was true equally of the notion

while this surplus appeared in the form of a

surplus of use-values (the products of agriculture) no abstract

concept of such a surplus was either necessary or indeed possible.
Here, it would seem, lay for Marx the true significance of Smith's
work:

he was the first to attempt a systematic investigation of

the abstractions of value and surplus value.

The specific advance

constituted by his work lay in the fact that he saw that it was
labour in general - not merely one of its specific forms - which is
value-creating.

In his commentary on Smith's work Marx again draws

37

attention to the material basis in the development of the economy

which made possible this important step forward.

The notion of

'labour in general' was itself possible only in a rapidly

changing economy in which the traditional bond between the individual
and his labour was being shattered.

The indifference to the

particular type of labour when considering value - Smith's real,

if at times inconsistent point of criticism against Physiocracy implied the existence of a highly developed variety of specific
types of labour, none of which was predominant and all of which were
becoming increasingly subordinated to the demands of the market.
But as in the case of the French Physiocrats, so now in the case of
Smith:

Marx perceives definite limits to the advances which his

work constitutes.

From the point of view of the method

of

political economy, Smith continued and advanced the classificatory

work of his predecessors, notably William Petty.

At the same time

Smith was the first to attempt an abstract analysis of the capitalist

economy - to attempt to find the

or regularities of its develop-

ment and it was this latter aspect of his work which was carried
forward by Ricardo at a later date.
in the following way:

Marx characterises Smith's work

on the one hand he tries to uncover those

laws which would reveal the essential features which characterised

the economic system then emerging in Britain.

Herein lay the

significance of the Smithian notion of the 'hidden hand' summed up

in the well-known statement, 'It is not from the benevolence of the
butcher, the brewer or the baker that we expect our dinner but from
their regard to their own interest'?

Here, in this sentence is

contained Smith's conception of an economy which worked independently

38

of the aims of the individual.

This aspect of Smith's work Marx

refers to as its 'esoteric element'.

At the same time Marx

detects a considerable 'exoteric element' in Smith's writings,

that is one concerned, not with the inner structure of economic
relations, but with their immediately outward manifestation, that
is with the farm which such relations assume within the sphere of
competition.

It was this 'naieve duality' (Marx'S phrase) which

Ricardo saw as the major weakness in Smith's work.

It is a

duality seen most clearly perhaps in the law of value.

As is

widely recognised, Smith in fact held two, mutually inconsistent,

notions of value.

In certain places, Smith sees the value of

commodities as determined by the quantity of labour involved in

their production, as when he gives his famous example of the
beaver and deer:
"In that early and rude state of society which precedes
both the accumulation of stock and the appropriation of
land, the proportion between the quantities of labour
necessary for acquiring different objects seems to be
the only circumstance which can afford any rule for
exchanging them for one another. If amongst a nation
of hunters, for example, it usually costs twice the
labour to kill a beaver which it does to kill a deer,
one beaver should naturally exchange for or be warth
two deer. It is natural that what is usually the produce
of two days or two hours of labour, should be worth
double what is the produce of one day's or one hour's
labour." 10
In other places however Smith drops this labour exchange theory in
favour of what is in effect a labour command theory, or what amounted
to the same thing, a theory of value which sees exchange-value as
determined by the level of wages.

Thus we find Smith saying:

"The value of any commodity therefore to the person who

possesses it, and who means not to use or consume it
himself, but to exchange it for other commodities, is
equal to the quantity of labour which it enables him to
command.""
39

Smith is here in effect saying that the appearance of wages along

with profits and - once private property in land is established,
rent - overthrows the determination of value by labour time.

All

three 'factors' had now to be taken into account and Smith adopts
what is essentially an 'adding up' theory of value as Maurice Dobb
amongst others has pointed out.

Thus,

"In every state of society the price of every commodity

finally resolves itself into some one or other of all
of these three parts; and in every improved society all
the three enter more or less, as component parts, into
the price of the far greater part of commodities."12
Several later economists took hold of this latter,

e~teric,

aspect

of Smith's work and developed it into a theory of value which

constitutes the main point of the vulgar strand in political economy.
Ricardo recognised that there was indeed a contradiction in Smith's
treatment of value theory and, having recognised it he attempted to
resolve it.

And this Ricardo did by endeavouring to demonstrate

that the determination of value by labour-time could be made consistent

with the existence of wages, profits and rents.

That is, he attempted

to show that the law of value as given in Adam Smith's first formulation continued to hold for an 'improved' society.

In fact it is

possible to say that Ricardo went further and attempted to demonstrate

that the determination of value by labour-time was the only basis on
which the distribution of the social product between wages, profit
and rent could properly be explained, a task which he regarded as
being the major one facing political economy.

From the very outset

of the Principles Ricardo notes the different and ultimately

incompatible conceptions of value in The Wealth of Nations.
"Adam Smith, who so accurately defined the original source
40

of exchangeable value and who was bound in consistency to

maintain that all things become more or less valuable in
proportion as more or less labour was bestowed on their
production, has himself erected another standard measure
of value, and speaks of things being more or less valuable
in proportion as they will exchange for more or less of
this standard measure; not the quantity of labour bestowed
on an object, but the quantity which it can command in the
market: as if these were two equivalent expressions, and
as if, because a man's labour had become doubly efficient
and he could therefore produce twice the quantity of a
commodity he would necessarily receive twice the quantity
in exchange for it."13
This same point is made when Ricardo, once again objecting to Smith's
inconsistency, says
"In the same country double the quantity of labour may be
required to produce a given quantity of food and necessaries
at one time than may be necessary at another and a distant
time; yet the labourer's re~ard may possibly be very little
diminished. If the labourer's wages at the former period
were a certain quantity of food and necessaries, he could
probably not have been sustained if that quantity had been
reduced. food and necessaries in this case will have risen
by 100 per cent if estimated by the quantity of labour
necessary to their production while they will scarcely have
risen in value if measured by the quantity of labour for
which they will exchange."14
Ricarda saw that the duality to which he was here drawing attention
must be eliminated if political economy was to progress as a science.
It was through his efforts to grapple with the theoretical problems
left unresolved in the work of Smith that Ricarda was forced to
develop a quite different method in the analysis of economic phenomena.
It was this new method which for Marx constituted 'Ricarda's great
service to the science'.

Political Economy, Ricardo came to see,

must start with a fundamental proposition - the determination of

value by the quantity of labour bestowed upon a commodity.

All those

phenomena which appear, prima facia, to contradict this law must be

41

made compatible with it and the law of value thereby established as

the true axis of a scientific political economy.

'(Ricardo)

demonstrates that this law governs even those bourgeois relations

which apparently contradict it most decisively.'

(Th. 2, 60).

Here

lies the clue to the true significance of the English adage: 'it's
the exception that proves the rule':

the task of science for

Ricardo was to show that the law of value was, above all, upheld
preCisely through those phenomena which seemed, on the level of
immediate appearances, to overthrow it.
The general approach adopted by Ricardo in the Principles is as
follows:

after stating the law of value in a manner much less

ambiguous than in the case of Adam Smith, Ricardo then proceeds to

consider a number of questions in turn.
~xtent

He thus examines the

to which the law of value stands in contradiction with the

manner in which it appears in the realm of competition, as it

presents itself to the immediate eye.

Marx, in his account of this

approach tells us that,

"The basiS, the starting point for the physiology of the
bourgeois system - for understanding its internal organic
coherence and life-process - is the determination of
value by labour-time. Ricardo starts with this and
forces science to get out of the rut, to render an account
of the extent to which the other categories - the relations
of production and commerce - evolved and described by it~
correspond to or contradict this basis, this starting
point." (Th.2, 166).
The nature'of Ricardo's procedure can be illustrated by reference
to rent.

The chapter on rent in the Principles (Chapter 2) begins,

'It remains however to be considered, whether the appropriation of

land and the consequent creation of rent, will occasion any variation in the relative value of commodities, independently of the
quantity of labour necessary to production.' 15 Here Ricardo is
42

about to consider the extent to which, if at all, the existence of

the concrete category, rent, undermines, or at least forces a
modification of the basic starting point for political economy the law of value.
Ricardo deals with the question of wages in a similar manner.
Ricardo argues that, contrary to immediate appearances, the level
of wages is quite independent of the value of commodities.
Marx paid full tribute to Ricardo's efforts to create a systematic
political economy by following the method outlined here.

But Marx

drew attention to a series of weaknesses which nonetheless remained

with Ricardo and seriously vitiated his attempts to carry through
his intended task to completion.

It would of course be a mistake

to see these weaknesses as residing in the conclusions at which

Ricardo arrived;

it is clear that Marx objected to the very

structure and method of Ricardo's political economy.

We have already

noted that the opening chapter of the Principles deals with a series
of phenomena to see whether they can be reconciled with the law of
value, as Ricardo understood that law.

Ricardo examines wages and

considers that their level is independent of the determination of

value.

Here was a significant step beyond Adam Smith, who continually

allOWS a consideration of the level of wages to intrude his analysis.

Ricardo says on this matter: 'Labour of different qualities
differently rewarded.

This is no cause of variation in the relative

value of commodities.' 16 This point is elaborated further when we

43

find soon after

"The proportion which might be paid for wages is of the
utmost importance in the question of profits; for it
must at once be seen, that profits would be high or low;
but it could not in the least affect the relative value
(of fish and game) as wages would be high or low at the
same time in both occupations."1?
Having rejected Smith's claim that the emergence of wages undermines
(or at any rate seriously limits) the operation of the law of value,
Ricardo then continues (in the third section of the opening chapter)
to deal with the impact of the fact that fixed and circulating
capital exist in different proportions;

the fifth section of this

same chapter discusses how far a rise or fall in wages calls for a
modification of the initial value analysis, given the existence of
capital of varying durability and unequal rate of turnover in
different spheres of production.

Marx comments on the structure of

Ricardo's opening chapter as follows

"Thus one can see that in this first chapter not only are
commodities assumed to exist - and when considering value
as such nothing further is required - but also wages,
capital, profit, the general rate of profit and even, as
we see, the various forms of capital as they arise from
the process of circulation, and also the difference
between 'natural and market price' In order to carry
out this investigation he introduces not only en passant,
the relationship of 'market price' and 'real price'
(monetary expression of value) but the whole of capitalist
production and his entire conception of the relationship
between wages and profits." (Th.2, 168).
Here, it would seem, lies the essential point of Marx's attack upon
political economy and

t~e

key to grasping why he rejected not merely

its conclusions but its method of investigation.

tor Marx wishes

to stress that Ricardo started by assuming 'as given' the very

phenomena - the developed relations of bourgeois economy - which he
44

sought to explain.

This faulty procedure - which Marx at one point

characterises as 'giving the science before the science' - was

precisely a reflection of the a-historicism of political economy.
It should perhaps be emphasised that Marx never attacked Ricardo's
work for its abstract quality as such;

it was, on the contrary,

this very abstract quality which so appealed to him.

He did

however take Ricardo to task for the forced and inadequate nature
of the abstractions which he employed.

It was because he started

by assuming, taken as read, the social relations of capitalist

production that Ricardo tended to counterpose directlx the outward
appearance taken by these relations on the surface of society with
their inner source, which Ricardo identified with the law of
value.

Entirely missing from this procedure is a systematic

examination of the historical and logical paths by which this inner

law actuallY develops to produce and sustain the surface relations

of bourgeois society.

Or to put this same point another way:

Ricardo fails to trace the manifold and contradictory links

(mediations) between this relatively hidden inner determination

(law of value) and the immediate phenomena, or phenomenal forms, in

which this law 'moves' and finds its expression (prices, profits,
interest, etc.).

When Marx notes that 'all science would be

superfluous if the outward appearance and the essence of things

directly coincided' (III, 797), he was, by implication, rejecting
the methodological basis of Ricardo's work.

Ricardo, in effect,

allowed the day-to-day expression of the social relations of

capitalist production to stand in the way of his presentation of
the law of value.
45

It cannot be an accident that the structure of Ricardo's work is not

merely different from that of Marx but
opposite.

is in certain respects its

Whereas in the case of Ricardo all the historically developed

economic relations of 'modern society' are dealt with at the very

start of the work, quite the reverse is true in the case of Capital.
Marx in his work shows, not in the opening chapter, but over three
entire volumes, how all the economic relations of bourgeois economy
grow - and this growth it should be noted is at once logical and
historical - out of the relations of simple commodity production.
And in a fourth volume (Theories of Surplus Value)

the theoretical

reflection of this contradictory process is reviewed in the work of

all the leading (and many of the minor) political economists, both
'scientific' and 'vulgar'.

Marx is aiming to show that the essence

of all the contradictions in modern society - Which to the liberal

mind tend to assume the form of a series of separate phenomena - is
to be located, discovered, within the commodity form itself.

At

the same time, matters could not be left standing there insofar as
the growth and development of this contradiction had to be
demonstrated.

Thus while it would be a mistake to think that all

the relations of bourgeois economy (let alone of politics, ideology,

etc.) can be explained by direct reference to Marx's opening chapter
in Capital (this would imply that the structure of his work was akin
to that of Ricardo's), it would be equally erroneoud to believe that
these more complex relations can be considered in isolation from
Marx's analysis of the commodity.

Lenin sums up what is perhaps the

46

fundamental point here at issue when he writes

"In his Caoital, Marx first analyses the simplest, most
ordinary and fundamental, most common and everyday relation
of bourgeois (commodity) society, a relation encountered
billions of times, viz the exchange of commodities. In
this very simple phenomenon (in this 'cell' of bourgeois
society) analysis reveals ~ the contradictions (or the
germs of all the contradictions of modern society. The
subsequen~xposition shows us the development (~growth
~ movement) of these contradictions, and of the society
in the summation of its individual parts, from its
beginning to its end." (.k.9!L 38, pp 360-1).
Lenin here indicates that in Capital all the developed forms of
modern economy are traced to their point of origin in the simple
commodity form.

In the first volume Marx is concerned with the

nature of money and of capital and with the general relationship

of wage labour to capital.

In the second volume this concern

develops into an investigation into the turnover of capital and

the way in which this turnover modifies the analysis already made.
Having dealt with these matters, only now is Marx able (in his
third volume) to investigate the surface phenomena of bourgeois
economy and the reflection of these phenomena in the consciousness
of the agents of production themselves, as well as in political
economy.

In this way Marx aims to reveal that the appearances of

this specific mode of production are in no sense 'natural' but a

product of definite historically formed social relations;

this,

and second, that the consciousness of these relations is also not

arbitrary - not merely a false consciousness in this sense - but
is itself an objective product of these social relations.

This

tracing of the contradictory connection between social relations on

the one hand and social consciousness on the other was precisely
what was needed to demonstrate and make concrete the truth of
historical materialism, the 'testing out' of which Lenin considered
47

to be the real task of Capital.

But if this method of procedure

constituted Marx's efforts to establish that it was indeed social

being which in the last instance determined social consciousness
it also contained at the same time the essence of his critique of
political economy.

for Marx had to show that the conceptions

which lay at the base of political economy were no mere illusions,

no product of apologetic intent (this element came to prominence
only with the domination of vulgar political economy), but were the
abstract expression of actually existing social relations.

Thus at

the very outset of the third volume Marx says:

"In Book I we analysed the phenomena which constitute the
process of capitalist production as such, as the immediate
productive process, with no regard for any of the secondary
effects or outside influences. But this immediate process
of production does not exhaust the life span of capital.
It is supplemented in the actual world by the process of
circulation, which was the object of study in Book II. In
the latter, namely Part III, which treated the process of
circulation as a medium for the process of social reproduction, it developed that the process of capitalist production
taken as a whole represents a synthesis of the process of
production and circulation. Considering what this third
book treats, it cannot confine itself to general reflection
relative to this synthesis. On the contrary it must locate
and describe the concrete forms which grow out of the
movement of capital as a whole. In their actual movement
capitals confront each other in concrete shape, for which
the form of capital in the immediate process of production,
just as its form in the process of circulation appear only
as special instances. The various forms of capital as
revolUid in this book, thus approach step by step the form
which they assume on the surface of society, in the action
of different capitals to one another, in competition, and
in the ordinary consciousness of the agents of production
themselves." (III, 25).
What Marx at one point describes as the 'faulty architectonics' of
Ricardo's work stemmed from the fact that he felt no need to
investigate the basic economic categories;

48

he pre-supposed them.

It was this faulty structure of this work, Marx felt, which led to a
series of related theoretical misconceptions, ones which exposed
Ricardo to the successful attack of his opponents.

Comparing Smith

with Ricardo, Marx emphasises bath his own indebtedness to the

advance which the Principles marked but at the same time the
inadequacy of its method.

The point is summarised thus:

"Adam Smith first correctly interprets the value and

relation existing between profit, wages, etc., as component
parts of this value, and then proceeds the other way round,
regards the process of wages profits and rent as antecedent
factors and seeks to determine them independently, in order
to compose the price of the commodity out of them. The
meaning of this change of approach is that first he grasps
the problem in its inner relationships, and then in the
reverse form, as it appears in competition. These two
concepts of his run counter to one another in his work,
naievely, without his being aware of the contradiction."
(Th 2, 106).
Ricardo's method is contrasted with this approach;

while Marx sees

this as an advance he nonetheless pOints to its limitations:

"Ricardo, on the other hand, consciously abstracts from the
form of competition, in order to comprehend the laws as
~.
On the other hand, one must reproach him for regarding
the phenomenal form as immediate and direct proof or
exposition of these general laws, and for failing to interpret
it. In regard to the first, his abstraction is too incomplete;
in regard to the second, it is formal abstraction which in
itself is wrong." (Th 2, 106).
This same point is repeated by Marx elsewhere, when for instance he
remarks:
"Classical political economy seeks to reduce the various fixed
and mutually alien forms of wealth to their inner unity by
means of analysis and to strip away the form in which they
exist independently alongside ana another lt often attempts
directly, leaving out the immediate links, to carry through
the reduction and prove that the various forms are derived
from one and the same source. This is however a necessary consequence of its analytical method, with which criticism and
understanding must begin. ClaSSical political economy is not
interested in elaborating how the various forms come into
beIng, but seeks to reduce them to their unity by means of
49

analysis, because it starts from them as given premises.

But analysis is the prerequisite of genetical presentation
and of the understanding of the real formative process and
its different phases." (Th 3, p.500).
To return to a point already anticipated in the Introduction to
this thesis.

Marx is here pointing to those limitations of

classical economics which derived from its empiricism.

As we

noted this empiricism derives from the work of John Locke, but it
is clearly evidenced in the work of William Petty.

In his

Political Arithmetic Petty makes explicit his empiricist standpoint:

"Instead of using only comparative and superlative words,
and intellectual Arguments, I have taken the course to
express myself in terms of Number, Weight Or Measure; to
use only Arguments of Sense, and to consider only such
Causes as have visible foundations in Nature."18
for the empiricist knowledge is limited to experience;

for the

'pure empiriCist' any concern with matters beyond the bounds of such
experience is deemed to be 'metaphysics'.

One consequence of this

philosophical method is that it takes a series of 'facts' as given

given, that is, by experience.

Speaking of what he calls the 'old

empiricism' (this to distinguish it from 'naive realism' which is

seen as a later development of empiriCism).

Lukacs remarks:

"The old empiricism often had a very naive ontological

character; it took as its starting-point the irreducible
existence of these given facts, naively remained at the
level of direct data of this kind, and left out of account
the further mediations which were frequently the decisive
ontological relationships.,,19
flowing from the conception of empiricism is a specific conception
of law.

for empiriCism a general law of phenomena - such as the

law of value or the tendency for the rate of profit to fall - is

taken as given, as a pOint of departure.

Such a general law,

argues empiricism, can be upheld only when it can be established,

50

as an immediately given principle under which all the given facts

being considered can be subsumed, without contradiction.

for

empiricism the 'general' is mechanically constructed out of a

series of 'concrete' experiences and in this way all dialectical
relations are set aside, since the universal is merely analysed
from the empirically concrete.

Engels characterised this method

the method which starts with a series of principles or

which

are then tested against the 'facts' as ideological - as a method

which in fact inverts the true process by which knowledge is
developed and extended.
"The general result of investigation of the world are
obtained at the end of this investigation, hence are not
principles, pOints of departure, but results, conclusions.
To construct the latter in one's head is ideology, an
ideology which tainted every speCies of materialism
hitherto existing. H20
And Engels points out the roots of this ideology;

it rested on a

lack of understanding of the origin of thought in definite

historical-social conditions:
"While in nature the relationship of thinking to being was
certainly to some extent clear to materialism in history
it was not, nor did materialism realise the dependence of
all thought upon the historical material conditions obtaining at the particular time.,,21
This method of starting

from principles (instead of abstracting

them in the course of theoretical work) was essentially the same as

beginning with abstract definitions into which the facts can then
be fitted;

or, should the facts fail to 'fit', then the defini-

tions can be changed accordingly.

Engels commented upon this type of method, when, commenting
specifically on Capital and reviewing various treatments of the
51

transformation of values into prices he says that several mistakes

made by one writer
"rest upon the false assumption that Marx wishes to define
where he only investigates, and that in general one might
expect fixed, cut-to-measure, once and for all applicable
definitions in Marx's works. It is self-evident that
where things and their interconnections are conceived, not
as fixed, but as changing, their mental images, the ideas,
are likewise subject to change and transformation; and
they are not encapsulated in rigid definitions, but are
developed in their logical or historical process of
formation. This makes clear, of course, why in the
beginning of his first book Marx proceeds from the simple
production of commodities as the historic premise,
ultimately to arrive from this basis to capital - why he
proceeds from the simple commodity instead of a logically
and historically secondary form - from an already
capitalistically modified commodity." (Preface to III).
Let us consider again Ricardo's method in the light of this statemente

As we have seen Ricardo's starting point was the definition

of value according to quantity of labour.

According to him this

amounted to a general abstract category which encompassed

characteristics of all these phenomena (money, capital, profit,
etc.) which he was seeking to analyse.

Or putting the matter from

a slightly different angle, money, capital, profit, etc., were

conceived of as mere forms of value, all having a common source,
namely labour.

Labour was the common element, as it were, in each

of these economic categories.

Ricardo's abstractions:

Here for Marx lay the formalism

of

he sought merely to find what was common

in all the various phenomena which he set out to investigate.

But

for Marx the real law of a series of phenomena - their real

relationships and movement - could not be arrived at if analysis
was confined merely to establishing what these series of phenomena
held in common;

this was to confine theoretical work to the

52

category which Hegel called 'dead identity' (the point will be

elaborated further below).

It was for this reason that Marx was

unable to go along with Ricardo's definition of capital as

'stored up' 'accumulated' labour.
was a definite social relation

Capital, for Marx at any rate,

of production, a definite form in

which labour was organised and carried out.

the proposition that labour was the technical

He agreed fully with

basis for capital

(and this was an indispensible basis) but not its social basis.
Capital could not be understood in its speCificity, in its real
concreteness, if attention was confined merely to discovering
within it an element (labour) which it shared with lower economic
forms (value, money, etc.).

It could only be understood by means

of an investigation of the path whereby it had grown out of these

lower economic relations.

This involved a theoretical study of

its real birth and evolution.

It followed, assuming Marx correct,

that 'theory' and 'history' could not be separated:

to 'define'

capital was to understand the process which had brought this

social relation into being.

Science must then reproduce this

process theoretically in the form adequate notions or to use the

stricter term, in concepts.

(This matter is considered in some

detail in chapter 4 below.)

This was the essence of Marx's

dialectical method, one which distanced him considerably from the

methodological standpOint of political economy.

Speaking of the

notion of capital, Marx makes the following observations:

"To the extent that we are considering it here, as a
relation distinct from that of value and money, capital
is capital in general, that is the incarnation of
qualities which distinguish value as capital from value
as pure value or as money. Value, money, circulation,
etc., prices, etc., are presupposed, as is labour, etc.
53

But we are still concerned neither with a particular form of

capital nor with an individual capital as distinct from the
individual capital, etc. We are present as the process of
its becoming. This dialectical process of its becoming is
only the ideal expression of the real movement through which
capital comes into being. The later relations are to be
regarded as development coming out of this germ. But it is
necessary to establish the specific form in which it is
posited at a certain point.
Otherwise confusion arises. n

(G, 310).
We shall consider some further methodological aspects and implications of this and similar passages but let us at this stage note
that here Marx brings out very clearly his view of the relationship
between value and capital, a view which is quite difference from
that of Ricardo.

The value concept was arrived at by Marx not

through an aggregation of the abstract general attributes that

experience detects in all its speCial, developed forms (capital,
money, interest, etc.) as the method of empiricism would require.
Marx in point of fact arrives at his concepts by a quite different
route:

by means of an examination of one single, quite concrete,

actuallY existing relationship between people - that is, the exchange

of one commodity for another.

In the analYSis of the commodity, the

universal determinants of value are abstracted.

These determinants

are later reprodcced theoretically at higher levels of development

as abstract general determinations of money and labour-power and
capital.
In order to explore these methodological questions at greater length
and to consider more fully the differences on these questions between
Marx and the classical political economists we can consider the
problem of the relationship between value and profit, as this
relationship was dealt with in Ricardo's work.
54

We can start by

rehearsing some well-known details.

According to Ricardo the law

of the average rate of profit - which established the dependence

of the scale of profit on the quantity of capital as a whole and
the law of value - which insisted that only living labour created
value - stood 1n stark opposition or contradiction to each other.
But the problem was that both laws determine one and the same
phenomenon - that is profit.

This was an antinomy which gave

Ricardo enormous problems and one which Malthus seized upon with such
relish making it the basis for his attack upon the Ricardian school.
Here was a real problem, a real contradiction.

for Ricardo had

discovered that there was no direct, no immediate, relationship

between the law of value and its immediate appearance;
appearance stood in opposition to the law.

indeed its

As soon as Ricardo

attempted to deal with the nature of profit in a theoretical manner,

that is to understand it on the basis of the law of value, it led to
an apparently absurd conclusion.

If the law of value was universal,

if it was not to be confined to some mythical 'rude and primitive

state' as Smith proposed, then profit was in principle impossible,
a

proposition clearly denied by the most immediate and direct

experience.

Ricardo's genius and integrity allowed him to realise

that here was a real problem.

But how to resolve it?

All Ricardo's

difficulties at this point arose from the fact that he attempted to

deal with what was in fact a real material, objective, contradiction,
by means of a redefinition of his terms.

Political economy wanted to

subsume the immediate 'facts' of bourgeois economy directly under

what it took as its basic starting point - the law of value.
clearly back to the problem of empiricism, to the particular
55

We are

philosophical standpoint which according to Marx underlay the whole

of political economy.

As Marx observed, commenting upon the dis-

integration of the Ricardian school in the 1830s, in trying to make

the laws which determine value agree directly with those determining
the rate of profit, political economy got caught up with a 'much
more difficult problem to solve than that of squaring the circle
which can be solved algebraically.

It is simply an attempt to

present that which does not exist as in fact existing'.

In political economy's efforts to overcome the contradiction between
the law of value and the rate of profit by attempting to make its
concepts more precise lay the notion that the supposed problem arose
from an earlier error in thought;

it could not sBe, thanks to its

formal method, that the contradiction arose from the actual

contradictory nature of the phenomena under investigation.

In

connection with this type of method, one based exclusively on the

principles of a purely formal logic, Marx had this to say:
"Here the contradiction between the general law and further
developments in the concrete circumstances is to be
resolved not by the discovery of the connecting links but
by directly subordinating and immediately adopting the
concrete (in the example we are pursuing the average rate
of profit) to the abstract (the law of value in this
particular case). This moreover is to be brought about by
a verbal fiction, by changing the correct name of things.
(these are indeed 'verbal disputes', they are 'verbal',
however, because real contradictions which are not resolved
in a real way, are to be resolved by phrases.)". (pp.87-B).
Brought out here is another important matter:

the necessary relation-

ship between empiricism and the adherence to a purely formal logic.

Empiricism argues that the limit to knowledge is provided by
experience.

Unless one denies completely the possibility of a

56

knowledge of causality in nature or society (as did Hume) then the

question arises:
co-ordinated?

how are these individual experiences to be

In practice empiricism has relied upon the rules of

formal logic to as it were 'process' such experiences.

And the

main point here is that formal logic sees in contradiction not an

objective, and actual, contradictory relationship between the
phenomena under investigation but an error in thought.

In his widely

known 'What is Dialectic?' Karl Popper makes the essential pOint:

fA statement consisting of the conjunction of two contradictory

statements must always be rejected as false an purely logical grounds,.22

And elsewhere this same writer says, 'all criticism consists in
pointing out some contradiction or discrepancies, and scientific
progress consists largely in the elimination of contradictions
wherever we find them,.23

In ather words, on this view, the

existence of a contradiction is an expression of an as yet unresolved

error, an error which must be got rid of if progress is to be made in
the investigation concerned.

On this basis, the uncovering of a

contradiction and its removal involve an operation performed on an

aspect of the theory to bring it into harmony with another theory,
or part of theory which is regarded as true.

If we cannot succeed in

this operation then one of the two(contradictory) theories must be rejected.

Were we to follow Popper's lead, then the basic weakness of Ricardo's
theory (or at any rate that aspect of it which attempted to explore
the relationship between the law of value on the one hand and the
formation of an average rate of profit on the other) would reside in

57

its contradictory nature.

Either the law of value must be rejected

as it stands, or the notion of the rate of profit:

to be the route out of the seeming impasse.

this would seem

This was in point of

fact the main conclusion of Ricardo's leading followers.

And for

Marx none was more guilty than James Mill in his efforts to deal
with the contradictions which Ricardo had unearthed by purely
formal methods.

Mill started, says Marx, with Ricardo's system as

a purely abstract system of thought, ignoring the fact that this

system of thought expressed a (contradictory) reality.

Driven on

by the criticisms of Ricardo's opponents (Malthus was here in the

lead) and also sensing that Ricardo's work was in contradiction
with reality, Mill tried to eliminate the contradictions in the
master's thought by resort to a re-definition of terms.

What he

aimed for says Marx was 'formal, logical consistency'.

Mill was

in fact caught in a dilemma.

On the one hand he wanted to

establish that the bourgeois mode of production was the absolute

form of production 'and seeks therefore to prove that its real
contradictions are only apparent ones'.

At the same time'however,

Mill seeks 'to present Ricardian theory as the absolute theoretical

form of this mode of production and to disprove the theoretical
contradictions, both the ones pointed out by others and the ones he
himself cannot help seeing'. (Th 3, PP.84_5).24
How did Marx approach the contradictions of the Ricardian system?
Certainly in a manner quite different from that of James Mill.
In the first place, he proposed a quite different source for these
contradictions;

for him they lay not in the errors of Ricardo's

thought, in the realm of theory but arose from the real contradic58

tions in the phenomena which Ricardo, through his theoretical

endeavours, was seeking to express.

Speaking of Ricardo and here

contrasting him directly with Mill, Marx says 'with the master
what is new and significant develops vigorously amid the "manure"
of contradictions out of the contradictory phenomenat'.

follow-

ing from this, Marx held that the more deeply Ricardo penetrated
the social relations of bourgeois economy, the more openly the
contradictory nature of such relations revealed themselves in his
theoretical work.

for Marx - always an enemy of purely formal and

metaphysical thought - contradiction was the form assumed by all

development.

Thought if it aspired to be truly scientific must

aim consciously to expresses the contradictions within the phenomena

it was trying to investigate for only by so doing would it be able
to grasp the movement of such phenomena.
the contradictions in Ricardo's work;

Mill tried to eliminate

in this regard, although his

work was an attempted defence of Ricardo against his detractors,

and although Mill continued the (progressive) task of defending the
interests of industrial capital against landed capital, it really
constitutes the true beginning of the 'disintegration' (Marx) of
Ricardo's work.

Marx recognised in the contradictions of the

Ricardian system the maturing contradictions of capitalist economy.

This is Marx's meaning when he says that Ricardo's system expressed
the relations of this economy 'with social validity'.

If this were

the casa, then it followed that it was a matter of disclosing,

through investigation, how these contradictions were in reality,
in life, finding not a formal solution (re-definition of terms etc.)
but an actual, concrete, solution.
59

This Marx set out to do;

he

sought to express this solution conceptually by means of a

demonstration of the manifold links which in reality connected
the essential laws of bourgeois company (law of value, formation
of the average rate of profit) with their expression on the direct
surface of bourgeois economy and society.
It would not be an exaggeration to say that here were opposed two
quite different conceptions:
logic.

those of formal and dialectical

ror Marx a formal logic - that is one confined to the

principle of non-contradiction - could never successfully resolve

the antinomies of Ricardo's system.

It required dialectics to

'go beyond' Ricardo and this being the case one can say that
materialist dialectics lies at the very basis of Marx's critique
of classical political economy.

ror dialectics, far from abhorring

contradiction, insists that contradictions inevitably arise in the

course of scientific progress;

the scientist must resolve such

contradictions, that is he must demonstrate how such contradictions

are resolved in a higher, richer, conceptual unity;

he must not,

like Mill did, attempt to sweep them away by resort to the canons
of formal logic.

Marx saw in the contradictions which Ricardo had

discovered the great strength of his work, discoveries which placed

him at the very summit of the achievement of political economy.
Ricardo was grappling with deep-seated changes in an economy undergoing rapid change in the first part of the last century.

The fact

that Ricardo came so close to disclosing the real contradictory

nature of capitalist economy (compared that is with what had gone
on before) signified that a decisive turning point, what Hegel

60

referred to in connection with the growth of science as a whole as

a 'nodal point', had been reached with Ricardo's work.
We have argued, in this section of the development of the thesis,
that it was only because Marx raised the principles of contradiction
to the very centre of his method that he was able to go beyond the
considerable achievements of the classical school in the sphere of
economics.

As a further, although briefer, illustration of this

point we can take the problem of the origin of capital.

In the

first volume of Capital we find Marx's well-known statement

"Our friend, Moneybags must buy his commodities at their
value, must sell them at their value, and yet at the end of
the process must withdraw more value from circulation than
he threw into it at the start. His development into a
full-grown capitalist must take place, both within the
sphere of circulation and without it. These are the conditions of the problem." (I, 166).
In other words, argues Marx surplus value cannot arise within the
sphere of circulation, yet it can only arise within this spheret
Immediately before this Marx has made the same point when he says:
'It is therefore impossible for capital to be produced by circulation, and it is equally impossible for it to originate apart from
circulation.

It must have its origin both in circulation and yet

not in circulation.' (I, 165-8).

It was of course the prejudice

of Mercantilism that an economic surplus could arise only within

the realm of circulation, 'upon alienation'.

The later development

of political economy, starting with Physiocracy, was to turn the

science in the direction of production.

Yet this should not blind

us to the fact that Mercantilism did contain an element, an aspect,

of the truth, of the matter albeit one which it made into an
absolute.

It was this:

a simple commodity owner, considered in

61

relation to his own commodity, can never be the source of surplus

value but only of value.

It is therefore impossible that a

producer, outside the sphere of circulation, can, without coming

into contact with and forming relations with others, expand value,
annex surplus value, in short convert commodities into money or
capital.

So

~8rcantilism

was, within limits, right in insisting

that without circulation there could be no surplus value;

yet at

the same time it was wrong in attributing the origin of surplus

value to circulation

~~.

The adhereAt of a logic confined to the principles of non-contradiction

(formal logic) will claim:

to say that surplus value arises both in

circulation and yet cannot arise within circulation must be an

indication of some unobserved confusion, some undetected error, in the
theory concerned.

for him a solution will be obtained through the

refinement of the concepts with which the theory has been constructed.
Marx proposes a solution which is of a quite different order;

it

cannot be achieved by some redefinition of the two terms 'production'

and 'circulation' which would render them compatible (that is noncontradictory).

for Marx at any rate the solution was achieved along

the following road:

labour,

by recognising that the worker sold not his

as political economy imagined, but his labour power.

Now

the use-value of this latter commodity, labour-power, possessed the

unique property of being itself the source af surplus value.

It was

a commodity whose consumption is the materialisatian af labour, that

is to say in the creation of value, and whose circulation is therefore
production.

In ather words, the conversion of money and commodities

into capital arises in the sphere of the circulation of the commodity

62

labour power, the very circulation of which constitutes the sphere

of production.

Such a conclusion will certainly conflict with the

conceptions of a purely formal logic, for is it not self-evident

,

given to us through direct experience, that to be circulated a

commodity must first be produced?

It was precisely this rigidity

of thought, a rigidity which kept the determinations of an object

quite separate and apart, which always in the last resort
encountered . the inexplicable.
We can in passing note how a recent work on Capital deals with this
particular problem.
"Value analysis can analyse the exploitation in capitalist
production because of the concept of the value-creating
power of labour and the assumption that commodities despite
divergence 'represent' values. This means that for the
purpose of analysis of exploitation the differences between
production and circulation are obliterated, or rather, that 25
categories of exchange are interiorized within circulation."
On Marx's own account, quoted above, he never aimed to 'obliterate'
the distinction between production and circulation, as this account
has it.

What he did attempt was to show these categories in their

real unity, to show by what process such opposed categories actuallY

become identical and how this real identity-opposition provides the
only basis for explaining the nature of capital as 'self-expanding
value'.

The fact that labour power had been transformed into a

commodity (a 'fact' which the owner of capital took for granted) and
because it was a commodity which could exist only in a state of
(being bought and sold) was of course no accident.
something found in the nature of things;

Nor was it

it was something produced

by a definite development of society and specifically by the

63

enforced separation of labour from the direct ownership of the means

of production.
One of the consequences of the fact that the method of classical
economics was one limited to formal logic was that it was, in the
last resort unable to uphold the law of value.

As is well known,

under pressure from Malthus and others, Ricardo accepted that changes
in the rate of profit (rate of interest) could also, along with the
quantity of labour, effect relative commodity values.

This would

be the case, he conceded, when the organic composition of capital

(this was of course Marx's category;

in the case of Ricardo it

referred to the relationship between fixed and circulating capital)

was uniform throughout the various branches of industry.

for the

rate of profit to remain the same, the rise or fall in wages - to

which corresponds an inverse movement in profits - must have unequal
effects on capital of different organic compositions.
then profits fall and

SO

If wages rise.

does the price of commodities in whose

production a relatively large amount of fixed capital is used.

Where

the opposite is the case the result will also be the opposite.

That

is to say, the establishment of an equal rate of profit yielded by

capital of different organic compositions contradicts the law of
value.

And similarly, Ricardo admitted, with capital having different

rates of turnover and different degrees of durability.

Summing up

the point about fixed and Circulating capital Ricard says

"It appears that the division of capital into different
proportions of fixed and circulating capital, employed in
different tradesi introduces a considerable modification
into the rule, which is of universal application when
labour is almost exclusively employed in production;
namely, that commodities never vary in value unless a
greater quantity of labour be bestowed upon their
64

production, it being shown in this section that without any

variation in the quantity of labour, the rise of its value
will occasion a fall in the exchange of goods, in the
production of which fixed capital is employed; the larger
the amount of fixed capital the greater will be its fall.
(37-8).26

In short, the exchange of commodities could not, in the last reckoning, be considered as being independent of the level of wages, that
is of distribution.

After setting out to show that Smith was

mistaken on this matter, Ricardo actually yields the cass' to him.

The same is true when we consider the question of the durability of
capital.

In a letter to James Mill, written in 1818, Ricardo

states:
"I maintain that it is not because of this division into
wages and profit - it is not because capital accumUlates
that exchangeable value varies, but it is in all stages
of society due to only two causes: one the more or less
quantity of labour, the-other the greater or lesser
durability of capital: that the form27 is never superseded
by the latter, but is only modified."
Now Sraffa, in drawing attention to this letter has persuasively
argued that Ricardo was ha;!s trying to dispose of one of Adam Smith's
objections to the law of value.

More germane to the argument here

however is that Ricardo accedes to the proposition that value has

~

causes:

labour (a social phenomenon) and the durability of

capital (a natural-technical phenomenon).

We shall return to this

matter of the relationship between the social and the technical but

this passage from Ricardo seems once more to underline the fact that
he had failed, in the last resort, in his major aim - to establish
the entire science of political economy on the foundation of the
law of value.
~Because

As Marx comments:
Ricardo, instead of deriving the difference between
65

cost price and value from the determination of value itself,

admits that 'values' themselves are determined by
influences that are independent of labour time and that the
law of value is sporadically invalidated by these influences;
this was used by his opponents, such as Malthus f in order to
attack his whole theory of value." (Th 2, 100).
This last reference to Malthus reminds us that there was one 'solution'
to the unresolved contradictions of Ricardian political economy and
one which was in fact followed increasingly in the period after his
death.

This lay in divorcing entirely the law determining value from

that determining the rate of profit.

conflated, identified completely;

Cost price and value could be

what in the case of Ricardo was

a sporadically occuring exception could now be elevated to the status

of a law.

This was precisely the path which vulgar political economy

was to take.

It came to the conclusion that profit originated by no

means solely in labour, but in a diversity of what were essentially

discrete factors.

According to this line of reasoning it was

necessary to take account of the role of land, of machinery, of time,

of supply and demand, of 'enterprise' etc.
formula born:

'capital-interest;

Thus was the Trinity

land-rent;

labour-wages'.

All the problems which Ricardo had bequeathed to political economy

could now be disposed of.

Rent, profit and wages no longer confronted

each other as alienated forms having a common source, an inner unity,

but now became. heterogeneous and independent of each other.

It was

now possible to see these economic forms as merely different from

each other, but in no sense antagonistic.

The 'discords' in modern

economy which Ricardo's analysis had unearthed could now be pushed

into the background and the notion that the durability of capital
might playa role 'in the determination of value (a possiblity which
as we have noted Ricardo allowed) could now be extended to the point
66

where it was eventually claimed that all economic relations (income

distribution etc.) could be explained by reference to the given
technology.
In this sense the efforts to resolve the problems of Ricardian
political economy in a theoretical manner disappeared under this
conception.

There were simply a series of discrete factors which

'combined' to explain economic relations.

Ricardo's efforts to

establish a unified political economy which would explain economic

phenomena from one fundamental principle (the law of value) was
abandoned, at least by the majority engaged in the field of
political economy.

It was Marx who, starting with Ricardo's

achievement, attempted to resolve the contradictions of classical

economics, and resolve them in the manner indicated in this chapter,
that is in a real and not merely a formal manner.

It has been

suggested that Marx was able to begin this task only because he
rejected the empiricism of political economy;

Marx tackled many of the

basic problems of political economy by means of a (dialectical) method

which allowed him to trace the entire chain of connecting links
between the law of value and the determination of the rate of profit.
This Marx attempted in his prices of production theory in which the
contradictions of the lower economic forms (the analysis of value)
are overcome, resolved if you like, not in a formal method (redefinition
of terms) but are sublated in a richer, more diverse and concrete
conception.
Having considered several aspects of Marx's approach to the work of
the classical economists and indicated a series of philosophicalmethodological dimensions to his critique of the work of Smith,
67

Ricardo and others it is now proposed to deal at greater length with

one aspect of this critique, namely Marx's approach to the analysis
of labour.

68

Chapter
MARX'S

CRITIQUE

OF

:3

CLASSICAL

ECONOMICS

(II)

There is no doubt that in the estimation of the significance of his

work Marx himself regarded the treatment of the category labour as
of decisive importance.
"I was the first to point out and examine critically this
two-fold nature of labour contained in commodities. As
this point is the point on which a clear comprehension
of Political Economy turns we must go into more detail."
(1,41).

Writing later to Engels, Marx says (SC, 232)

"The best points in my book are 1) the two-fold character
of labour, according to whether it is expressed in usevalue or exchange value (all comprehension of the facts
depends upon this). It is emphasised immediately in the
first chapter; 2) the treatment of surplus value
independently of its particular forms as profit, interest,
ground rent, etc."
As we shall in the course of this chapter ses, these remarks are
of particular significance, given that in much recent literature
it is widely taken for granted that Marx shared a labour theory
of value which was in its essentials at least, not far removed from
that of his classical predecessors.

I shall argue in the course of

this chapter that this view is wrong and that the notion of a
'labour theory of value' in Marx's work is at best misleading and
at worst quite wrong.
Let us look again at Ricardo's formulation of the law of value,
which Marx recognised as marking a big advance on the work of Smith.
"The value of a commodity, or the quantity of any other
commodity for which it will exchange, depends upon the
relative quantity of labour which is necessary for its
production, and not on the greater or lesser compensation
which is paid for that labour."1
But to suggest that this was the theory of value developed by Marx
69

in Capital or even the basis for that theory would seem to be quite
wrong.

for on one question the whole of political economy preserved

a significant silence:

it made no analysis of the nature of this

'labour' that determined the magnitude of value, a point to which

Marx many times drew attention.
"As regards value in general, it is the weak point of the
classical school of political economy, that it nowhere and
expressly and with full consciousness distinguishes
between labour as it appears in the value of products and
the same labour as it appears in the use-value of that
product." (I, 80).
for Marx, labour was together with nature the basis for all social
life, in all epochs, a basis which remained independent of any
particular mode of production.

In all periods of history man

creates wealth only through a continual struggle against the Forces

of nature, of which forces he remains always an integral part.
a fundamental question remains still to be answered:

But

under what

particular social form did this universal relationship appear in

each epoch of history?

Replying to those who imagined it necessary -

or indeed possible - to 'prove' the law of value, Marx wrote

"The nonsense about the necessity of proving the concept of
vaiue arises from complete ignorance both of the subject
dealt with and of the method of science. Every child knows
that a country which ceased to work, I will not say for a
year but For a few months, would die. Every child knows too
that the mass of products corresponding to different needs
require different and qualitatively determined measures of
the labour of society. That this necessity of distributing
labour in definite proportions cannot be done away with by
the particular form of social production but can only
change the ~ it assumes, is self-evident. What can change
in changing historical circumstances, is the form in which
these laws operate. And the form in which this proportionate
division of labour operates, in a state of society where the
interconnection of social labour is manifested in the
private exchange of the individual products of labour is
precisely the eXChange value of these products. The science
70

consists precisely in working out ~ the law of value

operates. So that if one wanted at the very beginning to
'explain' all the phenomena which apparently contradict
this law, one would have to give the science before the
science."2
How is this passage to be interpreted?
lines.

I think along the following

Marx here pOints out to his friend Kugelmann that in every

society social labour is distributed in definite proportions.

society can dispose of this basic law.
forms in different societies.

No

But the law takes different

Under the conditions of commodity

production this universal law takes the particular form of the

'value' of the products of labour.

Simply to rest on the proposi-

tion that 'labour is the measure of value' (and to designate this a

'labour theory of value') leaves open what 1s the crucial question:
by what social and historical forces are the activities of men
expressed in the values of the products of their labour?

Now if

bourgeois economy is viewed naturalistically (that is if its social

relations are universalised, identified immediately with the laws of
nature) as was the case with political economy, then it is equally
'natural' to identify labour in its peculiarly capitalist forms
with labour in general.

It was not the least of Marx's achievements

in this field to have investigated the specific characteristics of

labour under commodity production, a matter not even considered to
be a problem for political economy.
To highlight the point at issue we can refer to a work which
rejects this standpoint and interprets the above letter to Kugelmann

in a quite different manner.

seeks to explain the

This work argues that that 'Marx

of value (value in exchange) as a

71

consequence of certain social relations (those of commodity pro duction) but in the context of a general law of value which applies to
all forms of production,.3

This argument boils down to the two

propositions that (a) 'value' is a universal economic category

found in all societies and that (b) exchange value is the particular
form taken by this universal economic relationship under conditions
of commodity production.
What do Marx and Engels say on the matter?

In Anti-Duhring (which

Marx read in the manuscript and to which he contributed a chapter)

Engels deals with the very point raised by Cutler et ale

In the

chapter 'Distribution' (Part III, Chapter IV) he makes the following

observation.
"Commodity production is by no means the only form of
social production. In the ancient Indian communities and
in the family communities of the sourthern Slavs, products
are not transformed into commodities. The members of the
community are directly associated for production; the
work is distributed on the basis of tradition and requirements and likewise the products in so far as they destined
for consumption. Direct social production and direct
distribution exclude all exchange of commodities, therefore
the transformation of the products into commodities and
consequently als0 thelr transformation into values."
(emphasis added). 4
Engels here stressed a point which is implicitly rejected by those
who adopt the position of Cutler, namely the fact that the
category value reflects a situation where the relations between men
in production assume the fetishised form of relations between the
products of their labour;

a situation where their social relations

of production are not direct but ones mediated through the

relations between 'things' which are exchanged on the market.

72

In a letter written to Kautsky in September 1884 Engels is, if

anything, even more explicit in rejecting the propositions that
'value' is a universal category and that 'exchange value' is its
particular form under conditions of commodity production.
"(You say that) value is associated with commodity production
but with the abolition of commodity production value too
will be 'changed' that is value as such will remain, and
only its forms will be changed. In actual fact however
economic value is a category peculiar to commodity production and disappears with it just as it did not exist
before it. The relation of labour to its product did not
manifest itself in the form of value before commodity
production and it will not do so after it." S
It is clear that as far as Marx and Engels were concerned the
category value arises only when the products of labour assume the
form of commodities and that exchange value is the form of
appearance of this category value, a necessary form which arises
from the very nature of the concept of value itself.
value does

exist on Robinson Crusoe's island;

The category

needless to say

the objects which Robinson needs to satisfy his various wants each
cost him a definite quantity of labour time.
give these objects a value.

But this does

Value can arise only when such objects

are eXChanged and then the labour of these products, assuming a

definite social form, become realised in the value
commodities.

of these

It should also be stressed that only when 'wage

labour is its basis does commodity production impose itself upon

society as a whole' (1,587).

Only then can the law of value emerge

from the embryonic forms which it possessed under pre-capitalist

conditions, to become one of the moving forces in the law of motion
of society as a whole.

(This point will be developed in chapter

four.)
73

It is thus important to be clear about the precise nature of labour

and its changing social forms under different historical epochs.
As one writer has with truth observed 'All Marxists agree that
labour is the content of value.
labour is under consideration.

But the problem 1s what kind of

It is known to us that the most

different forms may be hidden under the word "labour".

what kind of labour makes up the content of value?,6

Precisely
And it was

precisely such an adequate investigation of the nature of labour

in its changing historical forms that Marx found almost entirely
lacking in claSSical economic.

Instead of such a historical

investigation we were given by the classical economists a

'bald'

analysis of labour
"Without exception the economists have missed the simple
point that if a commodity has a double character - use-value
and exchange-value - then the labour represented in the
commodity must also have a double character, while the mere
bald analysis of labour as in Smith, Ricardo, etc., is bound
to come up everywhere against the inexplicable. This is in
fact the whole secret of the critical conception."?
It is surprising that this aspect of Marx's work has not received
closer attention, given the centrality which he accorded it.

This

same point is found in the famous analysis which Marx made of the
Gotha Programme of the United Workers Party of Germany.

Marx took

strong exception to a phrase in the first Article of the draft for

the programme:
culture'.

'Labour is the source of all wealth and all

He comments

"Labour is not the source of all wealth. Nature is just as

much the source of use-values (and its surely of such that
material wealth consists) as labour, which itself is only
a manifestation of a force of nature, human labour power.
The above phrase is to be found in all children's primers
and is correct so far as it is implied that labour is
performed with the appurtenant subjects and instruments.
74

But a socialist programme cannot allow such bourgeois

phrases to pass over in silence the conditions that
alone give them meaning. H8
To treat labour independently of the social conditions under which
it was performed at each historical period - social conditions
which had their basis in the means of production required to carry
out production - was to treat this category in an abstract manner.
Marx insists that value is an entirely social category ('having a
purely social reality') (I, 47) and containing not a single atom
of matter.

It is for this reason, that when Marx comes to consider

the relationship of 'labour' to 'value' he has in mind always

labour of a definite social type, namely abstract labour; it is
this labour,
..........

abstract labour, which 'creates' value, that is to say

creates and re-creates a set of social relations which are attached

to things.

Under capitalism - where commodity production has been

developed to the point where wage labour constitutes is basis - the

private labour of each individual is transformed into its OPPOSite,
social labour, only through the transformation of concrete labour
into abstract labour.
Now by abstract labour, Marx does not mean, as is commonly thought
to be case, some mental generalisation, some mere product of the
mind.

If this really were the case - if abstract labour is con-

ceived of as a category arrived at merely by picking out some element

common to all labour - then one would be forced to the inexorable
conclusion that if abstract labour is purely a mental construct
then so too must be its product, value.

(This would indeed appear

to be the position of those who consider value to be entirely

'metaphysical' - that is something beyond experience;
75

on this reading

of Capital

the law of value, having no empirical validity is reduced

merely to the status of heuristic device which, while having

possibly powerful ideological functions, has no status as scientific
category.)

According to this view only concrete labour, producing

empirically available use-values would qualify for the status of

'real' labour. 9
Let us therefore try to explore in greater detail Marx's notion of
abstract labour.

The products of labour take the form of

commodities when these products are made for exchange on the market.
As such they are the products of autonomous private labour, each
person carries out one determinate form of labour as part of the
social division of labour.

Of course, if this social division of

labour were a planned one, the products of individual labour would

not take the form of commodities.

While the production of commodities

is impossible without the division of labour, a division of labour

without the production of commodities is perfectly possible - as in
the case cited by Marx of a patriarchal peasant society.

further,

under commodity production labour is not immediately social;

it

becomes social labour only through the mediation of exchange relations

on the market.
Now in exchanging products men egualise

them.

That is, the market

as an objective process abstra,cts from the physical-natural aspects

in which one use-value differs from another;

and in so dOing the

market abstracts from that which serves to differentiate this labour.

Thus,
"Along with the useful qualities of the products themselves,
we put out of sight both the useful character of the various
kinds of labour embodied in them and the concrete forms of
that labour; there is nothing left but what is common to
76

them all human labour in the abstract." (I, 38).

and
"The labour that forms the substance of value is
homogeneous labour, expenditure of one uniform
labour-power. The total labour-power of society, which
is embodied in the sum total of the values of all
commodities produced by that society, counts here as one
homogeneoud mass of human labour-power, composed though
it be of innumerable individual units. Each of these
units is the same as any ather, so far as it has the
character of the average labour-power of society and
takes effect as such." (I, 39).
from these quotations alane, it should be clear that in the formation
of abstract labour we are far from dealing with a mental process, but
on the contrary with something that takes place in the actual process
of exchange itself.
"When we bring the products of our labour into relations with
each other as values, it is not because we see in these
articles the material receptacles of homogeneous human
labour. Quite the contrary: whenever by an exchange we
equate as values,. our different products, by that very act
we also equate as human labour, the different kinds of
labour expended upon them. We are not aware of this,
nevertheless we do it." (1).
What therefore is the real significance of this category abstract
labour?

Let us, in considering further this problem return to

certain aspects of political economy.

Ricardo and his predecessors

confused the universal character of labour (as the source, along

with nature, of wealth under all social conditions) with its
particular characteristics under capitalism, as the creator of
value.

It necessarily followed from this confusion that when Smith

and Ricardo considered primitive society, the hunter and the

fisherman should already be commodity owners and exchange fish and

77

game

in the proportion in which labour-time is embodied in these

products.

As Marx wrily observed of Ricardo:

'He commits the

anachronism of making these men apply to the calculations, so far

as their implements have to be taken into account, the annuity
tables in current use on the London stock Exchange in the year
1817'.

(I, 76).

The neglect of the historical character of that labour which is

embodied in commodities had, as far as the classical economists went,
its root in a failure to analyse the contradictory nature of the
commodity itself.

Smith - in this case followed uncritically by

Ricardo - had noted the difference between the 'value in use' and
the 'value in exchange' of commodities;

but the implications of such

a distinction had remained unexplored, namely the fact that only in

'modern society' (capitalism) does the production of use-values
take the predominant form of the creation of exchange values.

This

absence of a proper investigation of the commodity, was, for Marx,

connected with another weakness on the part of classical political
economy - its tendency to ignore the value-form in favour of an
almost exclusive preoccupation with the content of value.
nIt is one of the chief failings of classical economy that
it has never su~ceeded by means of its analysis of commodities,
and in particular of their value, in discovering that ~
under which value becomes exchange value. Even Adam Smith and
Ricardo the best representatives treat the form of value as
having no connection with the inherent nature of commodities.
The reason for this is not solely because their attention is
absorbed in the analysis of the magnitude of value. It lies
deeper. The value-form of the product of labour is not only
the most abstract, but also the most universal form taken by
the product in bourgeois production. If then we treat this
mode as production as one eternal for every state of society,
we necessarily overlook that which is the specifica differentia
of the value form, and consequently of the commodity-form and
its full development, money-form, capital-form, etc." (I, 81).
78

This exclusive concern with the content of value and the neglect of
the value-form would, said Marx, be akin to the method of a
physiologist who held that 'the different forms of life are a
matter of complete indifference, that they are only farms of organic
matter';

Marx adds 'It is precisely these forms that are alone of

importance when the question is the specific character of a mode of

social production.'

(Th 3, p.295).

It is clear that Ricardo's

false method involved inter alia a confusion, or conflation, of the

'social' and the 'natural';

for

exampl~

he saw money not as an

abstract and necessary product of the value relation, one which had
developed out of commodity production (this was Marx's conception
of the matter) but as merely a means of overcoming the technical
deficiencies of direct barter.

Nor could Ricardo aver fully grasp

the real character of capital, which he saw only in its immediate

shape as 'stored up labour' rather than as a definite social form
assumed by these means of labour.
Political economy, in the person of David Ricardo, saw labour as
the measure of the magnitude of value and it was engaged almost
exclusively with the quantitative aspects of this relationship - that
is with the quantitative relations between commodities.

It failed -

Marx suggests above why it failed - to see that when it treated the
various types of labour in a quantitative sense their qualitative
unity was always implied
labour.

that is their relationship to abstract

Here again were important, substantial, difference between

Marx and Ricardo which cannot be grasped if they are seen as merely
differences on the plane of economic theory.

Marx rejected the

social philosophy underlying the school of classical political economy;

79

this saw society as an aggregation of individuals, each engaged in

his individual labours, each tied together by market forces.

This

view of society as merely a summation of individuals - and this

can be taken as the essence of bourgeois individualism - lay at the
basis of the social philosophy of both Smith and Ricardo;

in the

former these individuals were cemented together by 'natural law'

whereas in the latter utilitarianism was the principle which made
possible the transition from the individual to the social.
Locke's philosophy is here again seen by Marx as the source of this
view 'because it was the classical expression of bourgeois society's
idea of right as against feudal society'. (Theories (1) 367).
It is notewrothy, that according to Marx, Locke conceived labour
exclusively in its concreteness;

for Locke labour constituted the

limit to private property in the sense that the only limitation of

the right to acquire private property should be the ability of the
individual to accumUlate property by dint of his labour.

Here lay

the appeal of a 'labour theory of value' to the rising capitalist

class.

Locke's stress on the connection between labour and

property constituted a blow against the conception that property

was inherited as of right. 10

It was this view of labour as a

subjective, personal, activity which was taken into political economy

and is reflected in Smith's notion of labour as 'toil and trouble'.
Implied here is the idea that labour is something engaged in by
choice rather then it being a nature-imposed, social actIvity.

(It

should be pointed out in fairness to Locke that his position was

very advanced for the period in which he wrote.

This was of course

true of his philosophical stance where his materialist empiricism 80

derived from Bacon and Hobbes - was employed as a weapon against

scholastic empiricism - but also from the standpoint of political
economy which is our immediate concern.

At a period when the

bourgeois form of property was far from being the sole form of
property and certainly not yet its dominant one, Locke chose to
regard it as precisely such.

In this respect he laid the basis for

that struggle which was taken forward in the work of Smith and
Ricardo against those feudal property forms which were becoming
increasingly outmoded.)
Despite the admiration which he expressed for the work of
Benjamin franklin, Marx also notes his confusion of labour in its
specifically bourgeois form with labour as such, with labour in
general.

Marx refers

significantly to franklin's 'restricted

economic standpoint', which took the transformation of the products

of labour for granted.

(Critique, p.56).

And again in connection

with another writer for whom Marx clearly had the highest regard,
William Petty, Marx says that his case 'Is a striking proof that
recognition of labour as the source of material wealth by no means
precludes misapprehension of the specific social form in which labour
constitutes the source of exchange-value.'

(Ibid, p.54).

Adam Smith also, for Marx, revealed his lack of any thorough
historical appreciation of the category of labour.
to see labour subjectively ('toil and trouble').

He also tended
He tries to

accomplish the transition from concrete to abstract labour by means

of the notion of the division of labour - one of the central
categories of his system.

This division of labour - from which

arises commodity production - for Smith had its basis in the famous
'propensity to truck, barter and exchange'.
81

Here in fact was an

inversion of the real relationship

the social division of labour.
that

~hile

bet~een

commodity production and

(The point being, as noted above,

commodity production necessarily involves a division of

labour the reverse is not the case.)

Stressing that at the centre of a scientific political economy must
be a concern with labour as a social process, Marx says of Ricardo
"Ricardo's mistake is that he is concerned only with the
magnitude of value. Consequently his attention is
concentrated on the relative quantities of labour which
different commodities represent, or which commodities as
values embody. But the labour in them must be represented
as social labour, as alienated, individual labour." (Th, 1,31).
Marx again points to classical political economy's limited concern
with the measure of value when he writes
"Commodities as values constitutes one substance, they are
the mere representatives of the same substance, social
labour. The measure of value (money) presupposes them as
value and refers solely to the expression and size of
their value. The measure of value of commodities always
refers to the transformation of value'into price and already
presumes the value." (I, 40).
And in

an earlier work, Wage Labour and Capital, Marx says: 'What

is the common social SUbstance of all commodities?

It is labour.

To produce a commodity a certain amount of labour must be bestowed

upon it,

~orked

up in it.

And I say not only labour but social

labour. I
It should be clearer from the above discussion
importance to the category abstract labour.
meant labour

~hich

particular goal.

~hy

Marx gives such

8y abstract labour is

is cut off, abstracted, alienated, from its

Under the capitalist system the labour of society

is by no means the mechanical summation of the labour of every

82

individual (as political economy suggested was the case).

The

labour process under capitalism has an independent existence which

stands against the labour of each individual;

the labour of each

individual has any (capitalist) validity only if it obeys the

objective laws of this social labour process.
labour for (say) ten hours;

An individual may

but this labour, viewed socially, may

only count for five hours, as in Marx's illustration of the case

of the hand-loom weaver, given early in the first chapter of
Capital.

It should be stressed that the use of the word 'count'

in this context does not imply that this 'counting' is carried out
by any individual or body;

the counting referred to here is one

accomplished by the very process of production and circulation

itself.

The acquisition of this independence on the part of the

labour process from the concrete labour of the subjects who actually
take part in the process reaches its high point with modern labour,
that is with wage labour.

The worker owns his labour power.

On

the basis of the separation of the greater part of the population

from the instruments of production this labour power itself becomes
separated from its formal owner, taking on its own independence,
becoming a commodity.

And not only does it assume an alien form

(as a value), but when realised on the market it becomes one of the
forms of capital, namely variable capital.
We have stressed Marx's strictures against the political economists
for what he took to be their limited concern with the purely quantitative side of the relation when they investigated commOdity
production and circulation.

But Zeleny in his important discussion

11

of Marx's method suggests that this should not be taken to mean that
83

Marx either rejected a concern with quantitative matters as something

of no importance, nor that he rejected entirely Ricardo's work in
this sphere.

Indeed Zeleny suggests that it was through a close

consideration of the limitations of Ricardo's one-sided quantitative

standpoint that Marx was able to advance beyond it.

He suggests the

following:
(1) That Marx did not dismiss Ricardo's analysis of the quantitative
relations of commodity exchange as worthless for an understanding of
the real basis of exchange value and the nature of capital.

Marx,

says Zeleny, recognised their positive role in rendering possible a

scientific knowledge of the true nature of the phenomena under
investigation.
(2) But, argues Zeleny, for Marx such quantitative analyses yielded
only a rough end deficient representation;

although an investiga-

tion of the quantitative aspects of the objects concerned was

necessary such an investigation constituted merely ons of the
individual aspects in the process of perceiving the objects whereas
for Smith and Ricardo the proposition that the quantity of labour
was the measure of value was taken by them to reveal the essence (or
the 'nature') of commodity Circulation.
(3) finally, suggests Zeleny, Marx's criticism of the limitations of
Ricardo's standpoint should not be read as meaning that Marx gave
less attention than his predecessor to the investigation of the
quantitative investigation of economic phenomena.

Zeleny cites the

example of 'Marx's analyses of the quantitative attributes of the

aversge rate of profit' which he suggests 'are more comprehensive and
84

more precise than those of Smith and Ricardo'. 12 Zeleny argues that
a concern with the quantitative aspect of economic relations has its
legitimate part to play in any scientific conception;

the crucial

thing he suggests is whether the limits of such quantitative

investigations are grasped, that is to say whether they are understood as part of a wider, more all-rounded process of investigation.

In this respect it is perhaps correct to draw an analogy

between formal logic and dialectical logic.

As we saw in the

previous chapter Marx traced many of the problems of Ricardian

political economy to the fact that it was based on a purely formal
method of abstraction, that is to say it was based on a method which

was limited to formal, classical logic.

But as we suggested at that

point in the argument, this should not be taken to mean that Marx
rejected out of hand any concern with formal logic.

formal logic -

the logic based on the proposition 'A equals A' was within limits
true;

was, for certain purposes, an adequate logic.

It was only

under conditions when these limits were exceeded, when formal logic
was asked to bear too great a load as it were, that it proved
inadequate and had to be transcended by a richer, more complete
logie, namely dialectical logic.
The importance of the points made by Zeleny is that they have a
direct bearing upon the central issues which we have suggested
underpinned Marx's entire critique, in all its aspects, of
classical political economy, namely that it adopted an a-historical
standpoint which had the effect of seeing the categories of
bourgeois economy as fixed and eternal.

Thus when Ricardo came to

investigate the relations of exchange between commodities he limited

85

that process of exchange to its quantitative aspects;

he had a

quantitative conception of the category of exchange whereas for Marx

'the category of exchange is employed in a new, incomparably richer
context'.

13

And this richer context arose from the fact that for

Marx every category of the understanding exists only in the process

of its alteration, exists only in the process of becoming something
else.
To illustrate this problem Zeleny takes two examples from the work
of Ricardo and Marx.

He takes first of all Ricardo's notion of the

'natural price of labour'.

On this matter Ricardo had written

nIt is not to be understood that the natural price of

labour, estimated even in food and necessaries, is
absolutely fixed and constant. It varies in different
times in the same country and very materially differs
in different countries. It depends essentially on the
habits of the customs of the people." 14
As Zeleny quite correctly notes 'Up to a point, Ricardo's concepts
of wages and the "natural price of labour" are not completely fixed,
.

15

fossilised categor1es'J but their variability is a purely quantitative variability.

Wages may vary because of changes in geographical

and historical circumstances;

but in the investigation of possible

changes in the 'natural price of labour' Ricardo fails to ask

labour (actuallY it is labour power which is involved) has a price.

Here Marx's approach is quite different.

Whilst not in any way

uninterested in the question of the particular level of wages at a

given moment Marx went beyond Ricardo's limited concerns by grasping
wages as an economic form which represents in its particular
qualitative attributes

some~hing

temporary, dependent on historical

conditions and the alterability of these overall economic conditions

(the totality of social relations within the capitalist system) of
86

which the wage relation is merely one aspect, one part.

As his second example designed to elucidate the limitations of
Ricarda's confinement to purely quantitative aspects of the various
economic relations, Zeleny takes the question of distribution.

He

quotes the well-known passage in the Principles where Ricarda

declares that the chief question for political economy is precisely
to investigate the distribution of the social product between the
three principal classes of the community;

namely the proprietor of

the land, the capitalist and the industrial labourer.

Then Ricardo

adds
"But in different stages of society, the proportion of the
whole produce of the earth which will be allotted to each
of these classes under the names of rent, profit, and
wages, will be essentially different; depending mainly an
the actual fertility of the soil, on the accumulation of
capital and population, and on the skill, ingenuity, and
instruments employed in agriculture.
As Zeleny notes in connection with this passage, although Ricarda
allows for a certain alterability in the fundamental economic

categories involved in a study of distribution, this alteration is

again of a purely quantitative character.

In other words the

peculiar form taken under capitalism by the universal category of

distribution is taken by Ricardo to be absolute.

It is only within

these 'given' parameters that quantitative differences take place.

Here again Marx's approach is of a different order;

he recognises

that the particular form taken by distribution is given by the

structure of a definite mode of production and the overthrow of one
form of distribution relations is possible on the basis of the
overthrow of the foundations of that particular mode of production.

67

Zeleny's last point - the limited nature of the Ricardian investigation of the relations of distribution - can be developed in a
specific direction, namely the understanding of the nature of class
antagonisms in work on the one hand and in that of Marx on the other.
This question is of a certain contemporary interest.

for some have

seen the recent renewed interest in political economy (as against a

more narrowly conceived 'economics') as consisting, in part at least,
of a restoration of the place of the problem of social antagonisms
into the study of economic phenomena.

It is undoubtedly true that

the neo-classical school attempted to remove entirely any consideration of class antagonisms from its theory;

this it did with its view

of a series of a-social 'factors of production' and its contention

that in the last instance distribution was determined by the level of
technology.

It is also true that this conception stood in the sharp-

est contrast to the tradition represented by Ricardo, which brought

the question of class antagonisms to the forefront of its analysis.
Marx certainly saw this emphasis upon problems of class conflict
(potential or actual) as one of the strengths of Ricardo's work (as
is well-known, and recorded by Marx, the American writer Carey
denounced Ricardo for precisely this emphasis).

And we know that

Marx, in giving pride of place to the discovery of the role of the

class struggle in history to earlier french historians, also recognised
the role of English classical economics in general and Ricardo in
particular in the investigation of the anatomy of this conflict.

But

it would be dangerous to conclude from this that Marx and Ricardo

shared a similar conception of the struggle between classes.
To form a clar conception of this matter it is important to under-

88

stand the place occupied by the notion of the class struggle in

Marx's general conception of history - historical materialism.
Despite a widespread popular misconception to the contrary it is
not the case that Marx and Engels saw in the class struggle the
fundamental contradiction of the bourgeois mode of production.
Nor, extending the point, did they see this class struggle as the
basic contradiction in history.

A glance at the famous 'Preface'

to the Critigue of Political Economy reveals this to be the case.

lri this short Preface, where Marx sets out the essentials of
historical materialism, there is no mention of classes, nor therefore
of the class struggle.

Marx does of course speak of the 'basis' of

society, a basis which consists of the social relations of production, relations which 'correspond' to a stage reached in the
development of the productive forces.

Only at a definite stage in

the growth of these productive forces do the social relations assume

antagonistic form, when society divides into classes.

Class

antagonisms must not be taken therefore as 'things-in-themselves';

they are rooted in the deeper, more basic, contradiction between the
productive forces of society on the one hand and the social relations
of a given period of history on the other.
it impinges upon the analysis of capitalism;

To summarise the point as

the struggle between

the two basic classes of bourgeois society (the class founded on

wage labour and that founded on capital) is the driving force of that
society only because it is the expression of a deeper conflict, namely
that between the increasingly socialised nature of production and its
ever more narrow private appropriation.
It should be clear that this was far from being Ricardo's view of
89

the class struggle.

He starts his work by assuming as given the three

basic classes - workers, capitalists (tenant farmers) and landlords.

Ricardo starts his work by pointing to the existence of these three
classes and reveals that the antagonisms between them are a function
of their economic interests.
landlo~-

Not only was the interest of the

enjoying as he did protection from foreign comoetition - in

conflict with the interests of the rest of society but Ricardo was
increasingly driven towards the conclusion that the development of
machinery might possibly be injurious to the interests of the worker.
These were considerable achievements;

but Marx attacked Ricardo

for

'naively taking this antagonism for a social law of nature' (Preface

to the 1859 Critique).

What Ricardo took as 'given' Marx felt it

necessary to explain.

Only at the very end of volume III - in the

famous unfinished chapter - does Marx start to deal with the class
relations of bourgeois society in a systematic fashion.

According

to Marx it is precisely in the realm of the class struggle that the

outmard forms of society - those forms which vulgar economy was
unquestioningly to accept - are continually 'smashed up' as Marx
a t one

. t says. 16

po~n

Thus the structure of Marx's work, in this

respect at any rate, can be considered as directly opposite to the

structure of Ricardo's Principles.
For Marx aimed to show not merely that the interests of the two basic
classes within capitalist society were intrinsically antagonistic this had already been established by the leading figures amongst his
predecessors - but to disclose the historical roots of this
antagonism.

For only in this way would it be possible to demonstrate

that capital not only produces the antagonism between wage labour
90

and capital but also the basis for overcoming it.

(This point should

be viewed in the light of the discussion in the Introduction above

about the limited nature of much of the pre-war Marxist political
economy which tended to be limited to precisely the demonstration
that capitalism was responsible for the exploitation of the working
class.)

This matter can be recast in the following manner:

the

ultimate aim of Marx's critique of political economy was not merely to

raveal the working cla88 as an exploited class (this fact had in any
case been recognised in the working class prior to Marx and was given
theoretical form with 'Ricardian socialism') but that it was a
revolutionary class, a revolutionary class because it is the most
decisive and revolutionary element in the productive forces of
modern society.

These productive forces, holds Marx, are driven

into increasingly sharp conflict with the social relations of

bourgeois society.

Here, at the same moment, lies both the source

of capital's most fundamental crisis and the possibility of

resolving that crisis.
In summary, whereas for Marx the existence of classes and the conflicts
between them is bound up with the development of the productive forces to which 'correspond' certain definite social relations - the
classical economists merely took as given the existence of the classes
of modern society and failed to inquire into their social and
historical origin.

Or rather, to be more precise, they tended to

explain the conflict between classes not in social terms but in

natural terms.
This is clearly the case if we consider economic crises, as they were
conceived by Ricardo.

Ricardo did not deny the possibility of such

91

crises;
~ere

his 'mistake' for Marx lay in the fact that such crises

attributed, in the final analysis, to the forces of nature

and not to the social structure

~hich

characterised capitalist

society.
The cornerstone of Ricardo's notion of economic crises rests of
course upon his theory of rent.

He starts by defining the rate of

profit as uniquely determined by the amount of surplus value to

variable capital (p1 equals s/v).

He then proceeds to confine his

discussion of changes in the rata of profit to one about changes in

the value of labour

po~er.

as advanced by Malthus

Accepting the 'principle of population',

(~hich

infinitely elastic assumes

pronouncing the supply of labour

~ages

constant at SUbsistence level),

Ricardo was then able to limit his analysis of the rate of profit to
one concerning the level of productivity in agriculture.
on the baais of the

'la~'

He believed -

of diminishing returns - that the productivity

of labour in this sector would decline over time.

This in turn would

force up wages and bring about a reduction in profits.

Hence his

famous dictum: 'The interest of the landlord is always opposed to

that of every other class in the community'.
This is intended to be only the briefest sketch of Ricardo's theory
of economic crises;

but it is clear that here was a natural theory

of crises, holding that in the final instance the rate of profit

was determined by the fertility of the soil.

Given the protection

afforded to agriculture, there must be a secular decline in the

profit rate as increasingly infertile soild is brought into
cultivation to sustain a growing population.

The corollary of

such a conclusion was that this process could be arrested if

92

sufficient fertile soil were to be brought into cultivation.

"Profits of stock fall only because land equally well
adapted to produce food cannot be procured; and the
degree of the fall of profits, and the rise of rents,
depends wholly on the increased expense of production.
If, therefore, in the progress of countries in wealth
and population new portions of fertile land could be
added to such countries, with every increase in capital,
profits would never fall, nor rents rise. 1t1 ?
Once more Marx traces Ricardo's deficiencies in this area - the
theory of economic crises - to his acceptance of the bourgeois form
of production as one in accord with the laws of nature.

Marx

observes that 'Those economists, therefore, who, like Ricardo, regard

the capitalist mode of production as absolute, feel at this point
that it creates a barrier to itself, and for this reason attribute
the barrier to Nature (in the theory of rent) not to production.'
(III, 254).

Marx certainly praised Ricardo's efforts to grasp the

movement of the rate of profit.

Not only did he probe this matter

much more deeply than Smith (who saw profit falling as a result of
growing competition - which was no explanation at all) but Ricardo
did, for Marx, see the significance of the rate of profit as the
motor of capital accumulation.
'~hat

worries Ricardo is the fact that the rate of profit,

the stimulating principle of capitalist production, the
fundamental premise and driving force of accumulation,
should be endangered by the development of production
itself. It (III, 254).

But, adds Marx, Ricardo was concerned here, as in so many other matters,
with the purely quantitative aspect of the problem (even though, as
Zeleny suggests, his understanding of the quantitative dimension of
the rate of profit - confusing as it did rate of profit and rate of
surplus value - was far less exact than Marx's).
93

Ricardo was at bast

only vaguely aware of the real forces lying behind the movement of
the rate of profit.

He conceived the problem, says Marx, 'in a

purely economic way - that is from a bourgeois point of view,

within the limits of capitalist understanding, from the standpoint
of capitalist production itself'.

(III, 254;

emphasis added).

We can develop further Marx's point that the classical economists

failed adequately to distinguish the social from the natural by
considering the efforts of Ricardo and others to 'define' value, an
attempt which as we saw from the famous letter to Kugelmann, Marx
saw as a misconceived task.
In an economy based on the production of commodities the equalisation
of labour is achieved through the equalisation of the products of
labour.

This is but another way of stressing the fact that all

varieties of concrete labour are reduced to abstract labour through

the market and in this process become social labour.

But nobody

can or does measure these many forms of labour empirically;

to

imagine that this is the case would, amongst other things, be to

ignore a fundamental feature of an economy' based on commodity
production - viz its spontaneous, anarchic,nature.

Considerable

misunderstanding will arise, suggests Rubin, if the law of value is

imagined to be an instrument which makes possible the comparison
and measurement of the various products in the act of eXChange.
It has often been held by economists and others that Marx emphasised
the category of labour precisely because he took it to be this
'practical' standard of value.

Many opponents of Marx have in the

past directed their efforts to showing that labour could not be

granted this privileged status and they have taken this position
94

precisely because of the absence of established units with which to

measure the various types of labour, which are different from each
other with regard to skill, intensity, etc.
Such a line of attack, in the estimation of the present writer,
misconceives in a fundamental manner the true nature of Marx's value
theory.

It is rather the case that it is both unnecessary and in

any case impossible to discover a measure or standard of value which

will render possible the equalisation of the various concrete types

of labour or their products.

A simple, but in the context of the

present issue, an important point to keep in mind is this:

with a

commodity producing economy the equalisation of labour can take

place only objectively, spontaneously, that is independently of the
wishes, knowledge, intention, etc., of any of the participants
within that system of commodity production and circulation.

Out of

the process of commodity production and circulation arises money

(gold).

Gold is not some external measure standing outside the

world of commodity circulation;

nor was it a devise 'selected' by

either economists or man generally as part of a conscious plan to

regulate, give stability to, that process of circulation.

This

measure (gold) was historically selected, after long trial and error,
in the sense that it was the physical-material properties peculiar
to gold which rendered it suitable to play the role of money
commodity.
The matter can be reformulated thus.
commodities commensurable;

It is not money that makes

on the very contrary, it is precisely

because all commodities are realised human labour, and therefore

95

capable of commensuration, that their values find their measure in

one and the same commodity.

By a social and historical process

this commodity is transformed into money.

We have already referred

to the social character of the labour which is the source of

value, summed up in Marx's conception of abstract labour.

It is

important here to note the significance of Marx's insistence that

it is not labour-time which creates and measures value, but
socially necessary labour-time, that is the time taken to produce
commodities at a definite stage reached in the development of the
productive forces.

It is only when a producer attempts to sell

his product on the market that he discovers its real, objective,

value (if any).

It is during periods of slump that the piles of

unsold commodities signify that the concrete labour embodied in

them (which of course was expended for a definite period of' time
with a definite intensity, etc.) was socially unnecessary.

The

expenditure' of concrete labour embodied in such commodities cannot,

through the force of the market, be transformed into abstract
labour.

Although the source of use-value, (that is of things to

satisfy human wants in a variety of ways) such labour creates no

value.

This value the owner of capital (nor the workers who have

expended the labour and embodied it in the products concerned) can

never know a-priori, even though he might be armed with the latest
market research findings, equipped with the most powerful computers
and even though he might have a knowledge of Marx's Capital.

The

essence of the capitalist process here is that the owner of capital

can discover the extent to which the concrete labour incorporated
into his products was socially necessary only at the end of the
96

process. Here, as elsewhere, 'the Owl of Minerva flies only at dusk'.

This being the case - as I believe it was in Marx's conception then the task of seeking some measuring rod for the process of value
creation within the capitalist system was not merely futile:

it

betrayed a lack of understanding of the nature of that process at

the most basic level.
Protagoras;

'Man is the measure of all things' held

in point of fact it is not man who measures the value

of commodities, nor is it a case of an external measure being brought

to bear on the mass of commodities circulating within the capitalist
system.

Rather it is the case that commodities discover their own

measure of value.

for Marx the task was to discover the nature of

the process through which this was done, to discover in the movement
of commodities the laws and tendencies of the processes involved.
This being the case - it being the case that the laws of phenomena
cannot be known simply through an empirical knowledge of individual
things - then such laws never reveal themselves directly on the
surface of the phenomena concerned.

I might for instance know that

a particular product, a chair, has taken tan hours of labour to

produce, in other words that there are embodied within it ten hours
of labour.
chair;

But this can tell me nothing about the value of this

to discover that value and its magnitude the chair has to

enter the world of commodity production and circulation as a whole,

a process that embraces all branches of the economy;
process alone can its value be discovered.

in this

This is how Marx puts

the matter early in Capital

"In the midst of the accidental and ever-fluctuating exchange
relations between products, the labour-time socially necessary to

97

produce them asserts itself as a regulative law of nature.

In the same way, the law of gravity asserts itself when a
person's house collapse on top of him. The determination
of value by labour-time is therefore a secret hidden under
the apparent movements in the relative values of commodities." (1).
And Marx makes a similat point when he writes
"Under capitalist production, the general law acts as the
prevailing tendency only in a very complicated and
approximate manner, as a never ascertainable average of
ceaseless fluctuations." (III, 161).
Classical political economy ran up against impossible difficulties
in its search for some formal standard by which to measure the
magnitude of value.

On some occasions Smith saw this standard in

'commandable labour' which amounted to seeing wages as' the measure

of value.
measure.

On other occasions he saw corn as constituting this

Others found in labour or in money such a standard.

Marx's comment on this matter reveals the not inconsiderable distance

separating him from all those who looked at matters in this way for
'The problem of an "invariable measure of value" was simply a
spurious name

for the quest for the concept, the nature of value

itself, the definition of which could not be another value.'

(Theories

3, p.134).

Marx paints out that Bailey had rendered at

least one service to science in the course of his attack on classical

economics in that 'he revealed the confusion of the "standard of
value" (as it is represented in money, a commodity which exists
together with other commodities) with the immanent standard of
value' (Theories 3, p.137).

Nor was Ricardo exempt from the criticism

levelled here by Marx, for

"Ricardo often gives the impression, and sometimes indeed writes,
as if the quantity of labour is the solution to the false, or
falsely conceived problem of an 'invariable measure of value'

98

in the same way as corn, money, wages, etc. were previously

considered as panaceas of this kind. In Ricardo's work
this false impression arises because for him the decisive
task is the definition of the magnitude of value. Because
of this he does not understand the specific form in which
labour is an element of value, and fails in particular to
grasp that the labour of the individual must present itself
as abstract general labour and in this form, as social
labour. Therefore he has not understood that the development
of money is connected with the nature of value and with the
determination of value by labour time." (Theories 3, p.137).
On this matter of the 'measure of value' Marx was in fact making a point
with wider significance;

namely the fact that involved in this false

search for a 'measure of value' was an equally wrong procedure which

imagines that science must start from a series of concepts which can
then be tested to see the extent to which they correspond to their
empirical manifestation.

Thus in his critical comments on Adolph Wagner

(Wagner had accused Marx of 'illogicality' in splitting the concept

of value into exchange-value and use-value) Marx says, inter alia,
'Above all I do not proceed on the basis of "concepts" and thus not
from the "value concept" What I proceed from is the simplest
form in which the product of labour in contemporary society manifests
itself;

and this is the "commodity".,18

We nave already in the Introduction of this thesis, drawn attention

to the leading role which Maurice Dobb for long occupied as the
leading commentator on Marx's Canital in this country.

It is clear

that Dobb himself held what we have here argued was an erroneous
position:

the belief that Marx regarded the category of labour as

the standard, or constant, most suitable as the basis on which to

develop his analysis of capitalism.

This is how Dobb puts the

issue, when explaining why Marx took labour as the principal constant
for his system:
99

"In the case of land or capital there were serious practical

objections to taking them as a basis: difficulties which
would have exceeded any of those which are charged against
the labour theory. Classical Political Economy was already
focussing attention on the non-homogeneous character of
land and was using the differences in the quality of land,
along with its scarcity, as the basis of the classical
theory of rent. Acres are more dissimilar than mon-hours
of labour. In the case of capital there was the more
crucial objection that it is itself a value, depending upon
other values, in particular on the profit to be earned."19
If the argument we have outlined above is correct then it is
necessary to conclude that Dobb's defence of Marx is at root
misconceived.

It cannot for instance be argued that 'acres are

more dissimilar than man-hours';

it is obvious that every use-value

is not only the product of different individuals, but also the

result of individually different kinds of labour.

When we consider

labour as the creator of use-values - that is labour as a material

process common to all societies - it is impossible, in principle,
to compare not merely labour of different skills but even labour in
the same trades or occupations etc.

'Oifferent use-values are,

moreover, products of the activity of different individuals and

therefore

the result of individually different kinds of labour.'

20

Here again is the danger of confining oneself to a simple 'bald'

analysis of labour.

As a concrete, material

activity it is

impossible to compara the labour of one person with that of another;

only in the course of a social process, a process in which concrete
labour is transformed into its opposite, abstract labour, does this
process of commensurability take place.

Dobb, it would seem, has

missed the significance of this vital pOint.

To take the matter a little further.

100

It will be recalled that in

his Science of Logic Hegel took exception to that very notion of the
role played by concepts in human thought

which is present in

Maurice Dobbls defence of Marxlthat is as auxiliary 'tools' through

which man came to know the phenomena he was investigating.

Indeed

the whole of the Introduction to the Science of Logic can be read

as an attack upon this separation of thought (concept) from object
which reached its high point with the philosophy of Kant.

Hegel

regards this division - in which concepts serve as mere 'means' for

apprehending the truth of the object (the 'end') - as entirely false;
for it leaves unexplored the nature of these 'means'.

The laws of

thought - the procedures by which concepts are formed and developed are assumed to inhabit a realm standing apart from the objects under
investigation.

They are, says Hegel, empty forms, forms without

living content, empty shells, into which the content of the world
is supposed to be poured.
The viewpoint of Maurice Dobb to which reference has just been made
can be considered as an example of this philosophical

standpoint~

Certain 'criteria' are selected with which to investigate economic

phenomena;

but the criteria - in the example cited, homogeneity is

the one chosen - themselves go unexamined;

taken dogmatically.

they are merely asserted,

Thus the particular work from which the passage

was taken opens with a chapter entitled 'Requirements for a Theory

of Value'.

In the course of his discussion Dobb admits, in consider-

ing the relative merits of various value-theories, that 'Quite a

number of theories of value can be devised with no means of choice
between them except their formal elegance' and as a result he
concludes with a position which borders on that of instrumentalism:
101

'The ultimate criterion (for the 'adequacy' of any value theory)

must be the requirements of practice:

the type of question which

one requires to answer, the purpose of the inquiry in hand.' (8).

Here of course the basic principle of materialism is close to being
abandoned.

For materialism insists that thought, concepts, reflect

an external world which is independent of and prior to such concepts.

It takes as its starting point the material and social world and
gives priority to this material world as against our thoughts of it.
From this paint of view the adequacy of any theory lies in the extent
to which it accurately reflects, grasps, this independently existing
material world.

It is pragmatism which replaces this priority given

by materialism to the objective world by the category of practice.

That Maurice Dobb comes close to this position arises from his false
posing of the problem of value theory.

He starts from unexamined

assumption that there are a series of criteria against which the

'adequacy' of a theory may be judged.

The fact that he comes to the

conclusion that the 'labour theory of value' best meets such criteria
is beside the paint.

For he has approached the problem from a

standpoint closer to that of Kant than of Marx.

Kant believed that

the mind was endowed with certain categories of thinking through

which it could grasp the material and social world;
of such categories was left unexplored;

but the source

the mind was simply

constituted in the way that it was constituted.

Object remained

sundered from subject (the mind).

Here again it would seem that the crucial question involved in the
understanding of Capital and the disputes amongst Marxists about
the work involve nat so much details of economic theory but are
102

inextricably connected with a number of the basic questions of

philosophy.

In the first two chapters of the thesis we have argued

that in considering the differences which separated Marx from the

classical economists it is these philosophical questions which are
of prime importance and the failure of many commentators to
differentiate sharply enough between classical economics and Marx's
critique of that economics arises in the main from a failure to
give due weight to the philosophical dimensions of that critique.
In concluding this part of the discussion and by way of summary we
can say this.

Marx poured scorn on the standpoint of the vulgar

school of political economy because it took the empirically available

'facts' of bourgeois economy as coinciding directly with the essential
features of such economy.

For it, appearance and essence COincided,

a propOSition which if true, Marx held, would render science

superfluOUS - in this domain at any rate.

Classical economy was

distinguished from the vulgar school precisely because it did

distinguish between surface phenomena and their (relatively hidden)
essence.

And for Marx this was entirely to its credit.

But this

essence of economic relations is considered by Ricardo as something

unchangeable, akin in this respect to Newton's laws, as Zeleny
notes (10).

This fixed essence, was for Ricardo the amount of labour

required for the production of a commodity;

it is this fixed

essence which for Ricardo makes it possible to understand the variOUS

phenomena of the capitalist economy, to establish their unity and at
the same time to answer what Ricardo took to be the basic task of
political economy - to elucidate the laws which determined the

103

distribution of the social product between the three main classes

of early nineteenth century Britain.

This foundation, 'the quantity

of labour', once established remains unexamined.

Why the products

of man's labour should be compared according to the quantity of

labour they contain is a question not considered.

Thus while the

essence of all the economic relations of bourgeois economy can

change this change is related merely to quantitative aspects - some
things contain more, some less, labour.

Of course qualitative

determinations are present in Ricardo's work - he is aware of the

distinction between the landlord, the capitalist farmer and the
worker for instance.

But as Zeleny notes

"his theoretical analysiS does not treat them as qualitative

determinations, since - contrary to the nature of
qualitative determinations - they are derived from
appearances, from the empirical world, uncritically, as
fixed, unchangeable, unmediated. Thus for example wages,
profit and rent are qualitatively differentiated forms of
income in capitalism. Ricardo does not examine them however
with respect to their specific qualities, but considers them
as three constant 'natural' sources of the 'natural' classes
of the population and dedicates the whole inquiry to the
question of the changes in different quantitative relations
between these three forms of income, specifically between
different factors in the capitalist mode of production and
these forms of income. This shows how the one-sided
quantitative standpoint accompanies the a-historical
standpoint".21
In the course of the discussion thus far we have attempted to show
that the a-historicism of Ricardo and his fellow political economists
stemmed from his confusion between the natural and the social, a
confusion which has decisive importance for understanding the confusions which surrounded the notion of labour in classical political
economy_

When Marx speaks of Ricardo's 'purely economic way' of

looking at things he means essentially this;

104

the fact that political

economy transformed the properties of money, commodities, capital,

etc., which arose from their social existence into properties
belonging to them naturally as things.

Here was the fetishism of

political economy, a fetishism which, we have suggested, was

related directly to the empirical standpOint of this school, in that
it attibuted to the objects in their immediately perceptible form
properties that in fact did not belong to these objects and had
nothing in common with their perceptible appearance.

That is why

Marx speaks of that 'fetishism peculiar to bourgeois Political

Economy, the fetishism which metamorphoses the social, economic
character impressed on things in the process of social production
into a natural character stemming from the material nature of those
things'.

(II, 225).

It was this fetishism, this 'purely economic' way of treating

phenomena which Marx rejected.

It goes without saying that he

rejected many of the particular conclusion arrived at by Ricardo

and others.

But he was as concerned, in his critique of the

achievements and the shortcomings of his predecessors in the

classical school, to demonstrate the limitations of that method which
had led to these wrong conclusions.

In short, Marx proposed what was

a methodological-philosophical critique of political economy.

In

the next chapter we shall therefore explore certain further aspects

of this critique and consider more specifically the contribution
which Hegel made to Marx's work.

105

Chapter 4

THE

CONCEPTUAL

BASIS

OF

MARX'S

'CAPITAL'

According to Lenin, in its most profound sense, Capital is a work

which elucidates the history of capitalism and this it does by means
of 'an analysis of the concepts which sum up this history'. (LeW 38,
320).

Whether one accepts Lenin's specific judgement on this pOint,

it is undoubtedly the case that all the most significant attacks

against Marxian economics have been ones directed against the concepts developed in Capital - value, price of production, capital,
etc.
In examining the nature of Marx's concepts - the main task of this
chapter - let us recall one decisive point which emerged from his
critique of classical economy.

In that critique Marx was anxious

to stress the historical character of the categories of political

economy.

This approach to the development of political economy was

part of a wider conception that all science necessarily develops

through its own particular categories and it is only through the
elaboration of such categories that any science is able to gain a
more rigorous understanding of the objects and processes which are
the subject of its investigations.

It was this attitude to science

as a whole which shaped Marx's general attitude to the work of the

political economists.

As we have seen, Marx's attitude to the

classical economists was by no means a negative one;

in his work

in the history of economics, Marx's concern was never confined to

pointing out the errors of Ricardo and his other predecessors but
rather to a demonstration of the limitations of a method that had

106

produced a series of concepts which, while explaining bourgeois

economic relations 'with social validity', proved, in Marx's judgement, to be incapable of probing to the 'law of motion' of those
relations.
As we have already suggested, while the categories which Ricardo
developed in his investigation of capitalist economy did express
'with social validity' the relations of that economy, Ricardo, like
political economy as a whole, remained unconscious of the real
significance of this pOint.

Unlike Ricardo, Marx started conscious-

ly from the proposition that the categories of thought were not the
product of minds considered in their individuality;

the development

of thought, like the movement of human history itself, was the

product of 'many wills'. 1

In this connection it is perhaps signifi-

cant to note that in his study of the development of ideas about

value and surplus value Marx did not confine his attention to the
work of one or two individuals.
was given to the work of Ricardo.

It is true that particular prominence

But the work of Ricardo's major

opponents was also studied at length, even though Marx considered

that this work often contained much 'vulgar' materials (Malthus would
be a case in point).

Given Marx's overall approach to the develop-

ment of knowledge this cannot be construed as an accident.

Marx

aimed to study all aspects of political economy insofar as it was

only in the clash of the many wills concerned that the science had
in practice developed.

Ricardo's own development provides what can

be interpreted as a striking confirmation of the point at issue:

the objective character of the categories of political economy.

His

early work was almost entirely dominated by a concern with monetary

matters - the question of fixed currency and tha bullion price.
107

Despite the fact that Ricardo was familiar with Smith's Wealth of
Nations at the time of these early writings, there is no evidence
that at this stage of his work he was concerned with the more
abstract questions (law of value, rate of profit, etc.) which were
to dominate his later work.

In many ways it was direct practical

necessity which obliged him to consider these latter problems, in

particular the question of the Corn Laws and the analysis of class
relations surrounding the Laws.

And this in turn meant that

Ricardo was driven to deal with the theoretical inconsistencies

which he detected in Smith's work in these areaS.

In short he was

forced to 'connect up' with the most basic and abstract categories
of political economy as they had been developed up to that point.
In considering further this issue about the objectivity of thoughtforms, let us remember Marx's well-known statement in the 18th

Brumaire~

"Men make their own history, but they do not make it just as
they please: they do not make it under circumstances chosen
by themselves, but under circumstances directly encountered,
given and transmitted from the past. The tradition of all
the dead generations weighs like a nightmare on the brain of
the living. "2
The important point here, is that for Marx, what is true of man's economic
political, etc., history holds true of his intellectual development.
Every new development in knowledge, in all spheres, necessarily grows
out of the old forms in which that knowledge has historically emerged.
And, further:

the form taken by human knowledge is always a series

of interrelated concepts which, far from reflecting the whims of a

series of individuals, express man's practice as a whole in the sphere
of the science concerned.

If this point is accepted - and it is in

the last resort based upon a philosophical proposition - then it

106

would suggest that all attempts to separate Marx's thought off

completely from that of his predecessors is, in the ultimate sense,
a sterile exercise.

This would be true of those who, for instance,

have suggested that Marx was in a fundamental sense an a-Ricardian.

The diversity of pre-Ricardian and Ricardian economic thought
reflected, for Marx, the contradictory, diverse nature of the
reality under investigation, namely the emergence of capitalist
economic forms.

Marx set out to work over, to review critically,

this body of literature, recognising that as a reflection of man's

social practice it marked an important stage forward in the efforts
to understand these forms.
It is perhaps necessary to stress that Marx never dismissed the concepts developed by classical political economy as merely 'bourgeois'.
In Marx's estimation, Ricardo's work, of all political economy, came
nearest to reflecting the real interests of industrial capital (in
its conflict with the landed interest) precisely because it came
closest to a truly objective grasp of bourgeois economic relations.
And this seeming 'paradox' is explained precisely by the fact that
at the time he was writing, the industrial,bourgeosie still had undisputed claim to leadership in the development of the productive
forces.

The immediate class interests of industrial capital did,

at the time of Ricardo's work, coincide with the elaboration of a

scientific, objective, or to use Marx's term, 'disinterested' view
of social and clas3 relations.

Only when the leadership of industrial

capital in the further development of the forces of production was

seriously challenged - as it was with the appearance of an

109

increasingly conscious working class in the period following Ricardo's

death - did this position alter.

If this was the case, as Marx

held it to be, if, that is, the development of political economy was,
in the final reckoning, a reflection of unfolding class relations,
Marx was obliged to subject the categories of political economy to the
most detailed scrutiny.

for this was part of the task of uncovering

those social forces which had given rise to these categories.

This

is perhaps the most fundamental aspect of Marx's 'critique' of

political economy;

really to criticise political economy involved the

struggle to reveal the

necessit~

of the categories which political

economy had elaborated in the eighteenth and early nineteenth century

while at the same time demonstrating the limits of these categories
once the social relations which constituted their foundation had
progressed beyond a certain stage.
This point can be re-cast in the following manner:

for Marx, new

concepts arise in science because, penetrating evermore deeply into

the phenomena concerned, man reveals new aspects of these phenomena
which simply cannot be accommodated within the existing categories
of thought.

New concepts are demanded if these new aspects are to

be adequately expressed and established, established in the sense of

being placed within the framework of the science as a whole.
Engels' discussion about the analysis of surplus value, in the
Preface to the second volume of Capital is a useful illustretion of
the point at issue.

As Engels notes, the existence of that portion

of the value of products which Marx was later to designate surplus

value was ascertained long before Marx.

And Engels goes on to note

that it had been stated with some preCision what it consisted of 110

namely, of the product of the worker for which its appropriator

had not returned an equivalent.

But classical political economy

did not get beyond this point, at least on the theoretical level,
being conteot in some cases to investigate the quantities in which
the product of labour was divided between worker and owner of the
means of production or in other instances declaring the division
to be unjust and looking for utopian solutions to this injustice.
As Engels says (II, 15) 'They all remained prisoners of the
economic categories as they had come down to them.'

The details

of Marx's efforts to explain surplus value will not be our concern

at this stage - they obviously involved the conceptual differentiation between 'labour' and 'labour power' alluded to earlier.

The

important consideration is that Marx felt it impossible merely to

recognise the existence of surplus value, nor merely to proclaim
this surplus value as standlrg in contradiction to some ethical
principle;

this category had to be explained and this involved

Marx in a critical re-examination of the fundamental categories of

political economy which had hitherto been taken for granted.
In connection with the discussion of the problems which pre-Marxian
political economy experienced in understanding the nature of
surplus value, Engels draws an analogy between the history of
political economy and the development of eighteenth century chemistry.
"We know that late in the past century J the phlogistic
theory still prevailed. It assumed that combustion
consisted essentially in this: that a certain hypothetical substance, an absolute combustible named
phlogiston, separated from the burning body. This
theory sufficed to explain most chemical phenomena then
known, although it had to be considerably strained in
some cases. But in 1774 Priestly produced a certain
kind of air 'which he found to be so pure, so free from
111

phlogiston, that common air seemed adulterated in comparison

with it'. He called it 'dephlogisticated air'. Shortly
after him Scheele obtained the same kind of air in Sweden
and demonstrated its existence in the atmosphere. He also
found that this kind of air disappeared whenever some body
was burned it it or in ordinary air and therefore called it
'fire air'. from these facts he drew the conclusion that
the combination arising from the union of phlogiston with one
of the components of the atmosphere (that is to say from
combustion) 'was nothing but fire or heat which escaped
through glass'. (II, Preface).
As Engels notes, Priestley and Scheele 'had produced oxygen without
knowing what they had laid their hands on'.

Like the political

economists they remained prisoners of the conventional categories

of science - in this case chemistry.

It fell to Lavoisier (to whom

Priestley had communicated his findings) to re-work the entire

phlogistic chemistry in the light of this discovery.

It was

Lavoisier who came to the conclusion that this kind of air was a new
chemical element, and that combustion was not the result of this
mysterious phlogiston leaving the burning body, but the result of
this new element combining with this body.

Priestly and Scheele,

who had produced oxygen, were unable to see what they had done.
Thus although Lavoisier 'did not produce oxygen simultaneously and
independently of the other two, as he claimed later on, he
nevertheless is the real discoverer of oxygen vis-a-vis the others
who had only produced it without knowing what they had produced'.
(II, Preface).
Marx was unable to take the forms developed by political economy as
given.

He held that these forms had to be thoroughly investigated

because it was only through them that the real content of economic
relations could be discovered and properly established.

Here

again was one aspect of Marx's rejection of the empirical method

112

which he considered lay at the basis of the work of classical

economics.

We have already been concerned to explore certain of

Marx's objections to the empiricism of Ricardo and others, but one

way of developing this point is as follows.

Marx objected to

empiricism's claim that the only true material and ultimate source
of knowledge is furnished by perception and sensation.

As a

materialist Marx did not of course wish to deny that a material

world, existing independently of and prior to consciousness, is
the sole source of sensation.

Such a statement however correct

was nonetheless inadequate for a theory of knowledge which aimed

to overcome the inadequacies of a limited, mechanical, materialism.
It is of course the case that a form of empiricism lay at the base
of seventeenth-and eighteenth-century materialism in England and
france.

But at the same time this very empiricist point of view

also lay at the foundation of the idealism of Berkeley as well as

the agnosticism of Hume.

How is it possible, starting with the

proposition that perception and sensation are the only legitimate

forms of knowledge, to end up by holding, as Hume held, that an
exhaustive knowledge of that world is impossible?
assumed the following direction:

Hume's argument

to men are given directly percep-

tion and sensation and they provide the sola real base for knowledge.
In these perceptions is to be found no necessary internal connection.
How can we know therefore that one thing is the cause of another
thing?

We see only one thing followed by another;

if this is

constantly repeated we come to expect the second whenever the first

occurs.

But this has the status of a mere psychological expectation

and is. not the indication of causality.

113

This was one important

conclusion drawn by Hume from the empiricist theory of knowledge

and it followed that any statements about the objectivity of the
concepts of philosophy and science (causality, interaction, law,
tendency, etc.) kbuld be of a purely metaphysical character,
reflecting nothing in the sensed material of knowledge.

On this

view the tendency is to see logical categories as schemes which we

use (out of convention and habit according to one version) for the
organisation of sense-data.
Developing this point, we can say that Marx's objection to empiricism
rests upon a contention that empiricism was concerned exclusively
with the content of knowledge and not with the
knowledge had historically developed.

in which that

For empiricism, the form

assumed by knowledge tends always to be ignored as having no inherent

or necessary connection with the content, with the source of our
knowledge.

To return to a matter already raised in connection with

classical economics:

classical political economy - above all in

the case of Ricardo - saw in labour the source as well as the measure
of value, and by extension of capital.

But Ricardo had failed to

investigate the form assumed by this labour, and here was an

expression of Ricardo's philosophical stance and not merely a weakness
in his economic analysis.
One of the few works which appears to have given adequate attention
to the question of the form of knowledge and to have considered its
implications for Marx's work in political economy is the Soviet
economist I I Rubin, to whom reference has already been made.

One

of the purposes of Rubin's Essays on Marx's Theory of Value is to

114

stress the indebtedness of Marx to Hegel's achievements in philosophy

while at the same time emphasising the nature of the gap separating
Marx from Kant on a number of basic philosophical questions, all of
which for Rubin have a direct bearing on a proper appreciation of the
significance of Capital.

On this specific question of form and

content Rubin says

"One cannot forget that on the question of the relation
between form and content, Marx took the standpoint of
Hegel and not of Kant. Kant treated form as something
external in relation to the content, as something which
adheres to the content from outside. Rather, through its
development, the content itself gives birth to the form
which is already latent in the content. Form necessarily
grows from the content itself."4
There is little doubt that the influence of the philosophy of Kant
on the development of Marxism in this century has been considerable;
Lenin for one certainly saw this philosophy as providing the basis
for all those attempting a revision of Marxism at the most fundamental
level, a theme taken up at length in Materialism and Empirio-Criticism.
Clearly a consideration of Kantianism from this point of view lies
beyond the compass of the present thesis, but something of a more
limited nature must be said about Kantianism in connection wih the
discussion about the formation of concepts.
In an effort to vindicate scientific reason in the face of Huma's
rejection of causation and of the external world, Kant held that the
mind is an instrument which, by its very constitution, always
apprehends isolated, individual facts in rational form.

Kant

realised that without categories, rational thought was impossible;

but for him such categories have their basis in our thoughts,
thoughts which are sundered from the material world.
115

Sensations and

the logical moments of knowledge do not, according to Kant, have a

common basis - there is no transition between them, nor can there
be.

Concepts, for Kant, do not grow up and develop out of the

sensed world but are already given before it, in the a-priori
categories of reasoning.

One problem involved in this view - and it

was a problem to which Hegel was to devote much attention - is that

these categories are supposed to grasp the multifarious material
provided by sensation, but they themselves remain fixed and dead.
Kant tended to counterpose 'sensation' and 'reason' in what amounted
to a mechanical manner, just as his philosophical position tended to
counterpose the forms of knowledge with its content, in the manner
already touched upon.
It was above all Hegel, on the basis largely of a critique of this
view of Kant, who attempted to resolve the problem - of the connection between the 'sensed' and the' logical' and the 'content' as
opposed to the 'form' of knowledge - and it is one of the main
propositions of this thesis that Hegel's efforts had a considerable
bearing on Marx's work in the field of political economy.

Hegel

argued, in opposition to Kant, that thought is a process, moving

always from thought of a lower to thought of a higher grade.

If

thought was seen in this way, as a continual process, then concepts

developed by thought ceased to be dead, a-priori products of the
individual mind, but were in reality endowed with life, the life
of the movement of thought itself.
In the 'Introduction' to his Science of Logic Hegel attacked the
traditional view of logic as something dealing with a series of

116

thought-forms which were separated from the subject matter under

investigation as well as from the development of thought itself:
"Hitherto, the Notion of logic has rested on the separation,
presupposed once and for all in the ordinary consciousness,
of the content of cognition and its ~, or of truth and
certainty. First, it is assumed that the material of
knowing is present on its own account as a ready-made world
apart from thought, that thinking on its own is empty and
comes as an external form to the said material, fills
itself with it and only thus acquires a content and so
becomes real knowing." S
It was as a result of reading passages of this type that Lenin
declared:

'What Hegel demands is a logic the forms of which would

be forms with content' (LCW 38, 92) and supported Hegel's attack
on the old formal logic which hod conceived logic as dealing with
external forms of thought which were quite separate from the
phenomena under investigation:
"Logic is the science not of external forms of thought, but
of the laws of development 'of all material, natural and
spiritual things' i.e. of the development of the entire
concrete content of the world and its cognition i.e. the
sum-total, the conclusion of the history of knowledge of
the world." (Ibid, 92).
One important consequence of Hegel's rejection of the old conception
of logiC - as a mere 'proof producing' instrument - was that the
role of human practice, and more specifically the role of labour in
the development of knowledge could now be placed under the rubric
of logiC, properly conceived.

This was a point recognised by Marx

early in his intellectual development, many years before he came to

work on Capital.

Thus in the Economic and Philosophical Manuscripts

we find Marx praising Hegel for having seen that labour lay at the
basis of man's actiVity, in the course of which he alone could

117

develop, both materially and spiritually:

"The outstanding achievement of Hegel's Phanomenologie
is thus first that Hegel conceives the self-creation of
man as a process, conceives objectification as loss of
object, alienation as the transcendence of this alienation;
that he thus grasps the essence of labour and comprehends
objective man as the outcome of man's own labour.,,6
We have stressed that Marx's critique of classical political economy
was centrally concerned not so much with the mere conclusions which
this school had reached on a number of specific questions but rather
with the most basic concepts which the classical economists employed.
Marx was critical of the fact that the classical economists had
failed to inquire into the nature and origin of the concepts which
lay at the very foundation of their investigations of bourgeois
economy.

Marx sees in this, the uncritical adoption on their part

of the standpoint of empiricism.

One specific feature of empiricism

and one which had an immediate bearing upon the work of the classical
school, was, it has been suggested, the acceptance of the categories
with which it dealt as immutable, whereas in fact Marx, following
here the lead of Hegel, insisted that concepts continually develop
and that this development reflects an ever-deepening knowledge of the
real nature of the phenomena under investigation.
We can now attempt to explore Marx's contention to the effect that
rational knowledge is a deeper form of knowledge than that furnished
by mere direct apprehension of the material and social world in the
form of sensations and images.

It will be convenient to do so by

means of a review of Marx's investigation of the commodity;

this

will also allow us to antiCipate a theme to be considered in the

118

next chapter of the thesis.

by

We can start

by

considering a statement

Marx:
The reality of the value of commodities thus represents
Mistress Quickly, of whom Falstaff said, 'A man knows
not where to have her'. This reality of the value of
commodities contrasts with the gross material reality of
these same commodities (the reality of which is perceived
by our bodily senses) in that not an atom of matter enters
into the reality of value. We may twist and turn a
commodity this way and that - as a thing of value it
remains unappreciable by our bodily senses. (I, 47).

How is this properly to be interpreted?

Marx would seem to be

stressing that man can of course grasp through the senses the outward
form, the material envelope, of the many different commodities which
he encounters.

He can for instance weigh

length, test their hardness, etc.

them, measure their

But such sensuwsknowledge cannot

in any way disclose the universal connection between commodity

producers, cannot that is to say, disclose the social relations which
under capitalism become attached to these
objects;

sensuous~y.

perceived

nor can a mere familiarity gained through a knowledge of

the empirical, external features of the commodity

disc~ose

that

within the 'germ' of the commodity lies money, and cannot proceed
therefore to comprehend the movement of capital as a whole.

It was

his rejection of empiricism as a theory of knowledge which led Marx

to the conclusion that if the social relations of capitalism were
to be grasped - and this was the task of Capital as Marx saw it abstraction from the immediately experienced appearances of these
relations (as merely 'things') was necessary.

Thus Marx's well-

known observation' In the analysis of economic forms neither

microscopes or chemical agents are of use.
must replace both.' (I, 8).

Lenin~

119

The force of abstraction

comment, noting Hegel's

repudiation of those philosophies which reject conceptual knowledge

on the grounds that such concepts are without the spatial and
temporal material of the sensuous, would seem here appropriate
'Hegel is essentially right:

value is a category which dispenses

with the material of sensuousness but it is truer than the law of

supply and demand'.

(LeW 38, 172).

Of course empirical observation is certainly able to detect a common

element in the phenomena it is studying.

for instance in the case

of commodity production it is clearly the case that all commodities

are the product of labour which in this sense constitutes a common
element within each commodity.

But Hegel opposed such a method of

establishing concepts, considering it to be far from adequate.

In

fact Hegel drew what was an important distinction between the mere
image of a series of phenomena and a true concept of such phenomena.
'The mind makes general images of objects long before it makes
notions of them;

and it is only through these mental images and by

recourse to them that the thinking mind rises to know and comprehend
thinkinoly.' 7

Elaborating on this distinction between image and

concept Hegel further remarks 'It may be roughly said that philosophy
puts thoughts, categories, or in a more precise language, adequate
notions in place of generalised images we ordinarily call ideas.
Mental impressions such as these may be regarded as the metaphor of
thoughts and notions.,e

Once more, in drawing this distinction

between a mere image and a concept, Hegel was attacking that procedure,
found in Kant, in which concepts were arrived at by finding some
element common to the phenomena in which one was interested.

120

Thus

in his Loqik Kant states 'The concept is a general image or

representation of that which is common to many objects, consequently a general idea provided that it can be included in several
objects.,g
Hegel rejectsd this view on the ground, amongst others, that it
was confined to what he called abstract identity or abstract
universality.

Some aspect common to a range of objects is isolated

(abstracted) as that which is general to such objects, to be set

against a 'particular' which, on this view, can exist on its own.
One problem associated with such a method is that it is impossible
to demonstrate the necessity of the aspects which are taken as the
basis for the construction of a generalised image;

and if this is

so, such a procedure must in the end prove to be subjective.

Hegel

was in effect, in attacking the formation of images basad on the

principle of abstract identity, pointing to the fact that regularity
in appearance is no proof of causality, a point already stressed by
Hume.
Let us give a specific example from Hegel to illustrate the formal
method of image-building.

Hegel rejected the consensus gentium as

a proof for the eXistence of God.

The fact that everybody agrees

that God exists is by no means an adequate proof for his existence.

Unless the nature of this individual consciousness is thoroughly
explained and its inner necessity established, the proof remains
inadequate.

Thus:

"Among the so-called proofs of the existence of God, there

used to stand the consensus gentium, to which appeal is
made as early as Cicero. The consensus gentium is a
weighty authority, and the transition is easy and natural,
from the circumstance that a certain fact is found in the
121

consciousness of everyone to the conclusion that it is

a necessary element in the very nature of consciousness.
In this category of general agreement there was latent
the deep-rooted perception, which does not escaoe the
least cultivated mind, that the consciousness of the
individual is at the same time particular consciousness
and accidental. Yet unless we examine the nature of this
consciousness itself, stripping it of its particular and
accidental elements and, by the toilsome operation of
reflection disclosing the universal in its entirety and
purity, it is only a unanimous agreement upon a given
point that can authorise a decent presumption that that
point is part of the very nature of consciousness."10
Likewise, but from the opposite standpoint, Hegel praises Rousseau.

In the Social Contract Rousseau held that the laws of the state
must spring from the universal will (volonte generale) but need not,
on that account, be the will of all (volante de tous).

This, says

Hegel, is a striking expression of 'the distinction between

what is merely common, and what is truly universal'.
For Hegel a concept is primarily a synonym for the real grasping of
the essence of phenomena and could in no

way be limited simply to

the expression of something general, of some abstract identity

discernible by the senses in the range of objects concerned.

A con-

capt, if it were to prove adequate, had to disclose the real nature

of a thing and this it must do not merely by revealing what it held
in common with other objects in the range, but by establishing its
. 1 na t ure, ~t s pecu llar~
t y. 11

spec~a

The concept was for Hegel a

unity of the universal and the particular.

Hegel insisted that it

was necessary to distinguish between a universality which preserved

within it all the richness of the particulars and an abstract 'dumb'
generality which was confined to the outward sameness of all objects
of a given kind.

Further, Hegel inSisted, this truly universal

122

concept was to be discovered by investigating the actual laws of the

origin and development of single things.

A matt"Dd of thinking which

was limited merely to registering or correlating empirically

perceived common attributes was essentiallY sterile - it could,
suggested Hegel, never come near to disclosing the actual law of
development of the phenomena concerned.

If Hegel was correct in

this matter - and certainly Marx believed him to be and followed his
lead here - then one thing followed which has direct relevance for
an appreciation of Marx's method in Capital.

It was this: the real

laws of phenomena do not and can never appear directly on the

surface of things in the form of a simple identicalness;

that they

tend to appear like this was, implicitly at least, the conception

lying behind the method of Ricardo, a question with which we have
already been concerned.

Ricardo started with an abstract law (the

law of value) and tried to show that such a law operated directly
and immediately on the surface of bourgeois economy (that is in the
market).

And as we saw, when he - and even more so his followers

found that this was not the case, the method of political economy
was thrust into a crisis from which it could not extricate itself.
As a demonstration of Marx's indebtedness to Hegel's insistence that
the general cannot be adequately grasped if it is regarded as the
mere mechanical summation of the individUal phenomena concerned, we
can quote Marx's well known comment on Feuerbach:

"lJie}

resolves the religions essence into the human essence.

But the human essence is not an abstraction inherent in
each single individual. In its reality it is the ensemble
of the social relations. feuerbach, who does not enter upon
a criticism of this real essence, is consequently compelled:
(1) To abstract from the historical process and to fix the
religious sentiment as something by itself and to presuppose
123

an abstract isolated human individual. (2) Essence, therefore

can be comprehended only as an internal, dumb generality which
naturally unites the many individuals. "12
What is the significance of Marx's criticisms of feuerbach when considered in the light of the discussion about the nature of concepts?
Essentially this:

one can never get near to the real nature of a

any class of objects (in this case to man) through the discovery of
a series of attributes possessed by each member of the class taken
separately.

The essence of man can only be arrived at historically

(feuerbach, says Engels, was a

~aterialist

in connection with nature

but left materialism behind when he came to consider the social and
historical sphere).

further, it was only possible to establish that

this essence was not something fixed and immutable (the conclusion
for which Marx criticised feuerbach), a dead generality, but rather something which developed and changed, if it was grasped that man had to
be understood as part of the social world.

By implication, says

Marx, the essence of anything is not something internal to this thing

but something which revealed itself always in its relations with
other things. (I, 26).

To grasp the essence of man, for Marx, meant

the struggle to comprehend the formation and growth of human society

as a whole - and of its separate individuals - as this process has
actually taken place and is continuing to take place.

As a separate

individual a person is only a member of a class (in this case man)

insofar as he actualises some aspect or side of a culture which has
been formed historically prior to and independently of him.

To the

degree that the individual embodies this historically developed

culture, to that extent he expresses the true, always developing and

124

changing, universal in man.

If this is so then this universal is

no mechanically repeated uniformity at 'dead repose' in each and

every member of society.

It is on the contrary reality, repeatedly

and directly broken up within itself into particular separate

spheres which complement each other and are in essence mutually
connected in their transition, thereby constituting a real living
ensemble.
Feuerbach's conception of man - a product for Marx of his contemplative
materialism - involved an inadequate understanding of human practice;
Feuerbach did not, says Marx 'conceive human activity itself as
objective activity'.

(1st Thesis on Feuerbach).

In his efforts to

understand the peculiarities of man, Marx assigned a central role to

the part played by labour in human development, a point made by Engels
when he says
"Labour is the source of wealth, the political economists
assert. And it really is the source - next to nature which supplies it with the material that it converts into
wealth. But it is infinitely more than this. It is the
prime basic condition for all human existence, and this
to such an extent that, in a sense, we have to say that
labour created man himself."13
It was because Marx saw the central role played by labour in the development of man that he regarded with such sympathy Benjamin Franklin's
definition of man as a tool-making animal.

(I. 179).

Let us consider Franklin's conception of man, a tool-making animal,

in the light of the discussion above about the purely formal method
of establishing concepts from which Hegel separated himself.

If one

accepted that a concept merely rev eels some common element found in
all men, Franklin's definition would have to be rejected.
clearly the case that only a small minority of men actually

For it is
~

tools and such a definition would have to be passed over as being

too narrow and restrictive.

It would be possible, in an effort to

avoid such narrowness, to base one's conception of man on a wider

definition by isolating a feature which all men hold in common say speech, consciousness, the use of language, etc.

It is clear

however that Marx rejected such a procedure for arriving at adequate

concepts of the phenomena being investigated.

In connection with

his critique of Feuerbach Marx says the following

"Men can be distinguished from animals by consciousness,
by religion or anything else you like (emphasis added).
They themselves begin to distinguish themselves from
animals as soon as they begin to produce their means of
subsistence, a step which is conditioned by their
physical organisation. By producing their means of subsistence, men are actually producing their actual means
of lif8."14
By implication at least, Marx is here suggesting that a definition
of man based on 'consciousness', 'religion', etc., remained wholly
abstract because it cannot provide the basis for grasping how this
phenomenon (man) actually distinguishes himsslf from the rsst
nature.

or

The point at issue - the formation of concepts adequate to

grasp the development of the phenomena being studied - can be recast

as follows:

to form an adequate concept of anything two related

questions must be asked.

First the connection between this 'thing'

and the other objects to which it is related must be established

while at the same time the difference, within this connection, must
also be established in conceptual thought.
example of man:

To return to the specific

man is connected with the rest of nature (here the

work of Darwin was of great importance for Marx and Engels) and like
all living matter reacts to the external material world;

126

but unlike

the rest of the animal world man's relationship to nature is

ourposive, that is in his life man sets out to achieve definite
aims which actually precede the action of realising them (or
attempting to realise them).

Man's ability to carry out this

struggle against nature at a level qualitatively higher than in the

case of the rest of the animal world, was for Marx and Engels
directly connected with the development of tools.

Here for Marx

and Engels lay the true uniqueness of man.

Such a view of man, Marx and Engels held, avoids both a view of man
as something standing absolutely apart from nature, in which case
one is driven in the direction of concluding that his uniqueness
arises from non-material forces (the Life force for instance) a view
which has taken the form of vitalism in biology.

On the other hand,

equally one-sided would be the view that attempted to reduce the

laws of social development to purely biological or chemical laws, a
standpOint which in effect ignores the qualitative differences between
the various forms of matter.
This latter standpoint was the one adopted by the mechanical
materialism of the seventeenth-and eighteenth-centuries, and an
outlook which found its echo in political economy.

The seventeenth-

century natural scientists picked out velocity, mass and volume as

the simplest most general aspects of all physical phenomena, which
aspects were in turn considered in a purely quantitative manner.
The transformation of these aspects into unique essential qualities
of nature led them, in effect, to a denial of qualitative distinctions in nature.

In the same manner, political economy found in

127

labour the simplest common element in all economic phenomena, an

element which was then in turn considered only from its quantitative angle.
In this chapter we have been concerned, in somewhat general terms,
to explore what Marx meant by the term 'concept' and how this
meaning differs from that normally given to the term;

further, we

have suggested that in his rejection of a purely formal and abstract

method of arriving at conceptual knowledge, Marx was directly
indebted to the example of Hegel.

It is now proposed to deal in

more detail with a series of examples from Capital in an attempt to

show how the points we have raised in a general manner actually worked
out in practice.

It is proposed to take four specific examples:

(1) Marx's treatment of the labour process.

(2) The relationship

between value and use-value in Marx's analysis of capitalism.

(3) The value concept and finally (4) The concept of capital itself.
It is important to note that when, in the first volume of Capital,
Marx comes to deal with the labour process he proceeds in a definite
way and one, we suggest, which flows from the methodological issues

raised immediately above.

Contrary to what might seem at first

sight the correct procedure, he starts not with the process of labour
as it manifests itself in its specifically capitalist form.

On the

contrary the analysis starts by considering the general (universal)

features common to the process of labour in all societies.

Thus

"The fact that the production of use-values, or goods, is

carried out under the control of a capitalist and on his
behalf does not alter the general character of that
production. We shall, therefore, in the First place, have
to consider the labour process independently of the
particular form it assumes under given social conditions."

(r,

177).

128

Only having dealt with the universal aspects of the labour process
does Marx turn to the specific features which this process assumes
within contemporary society,
"It must be borne in mind, that we are now dealing with
the production of commodities, and that up to this
point, we have only considered one aspect of the process.
Just as commodities are, at the same time, use-values, so
the process of producing them must be a labour-process,
and at the same time a process of creating value." (I, 186).
To present this last point from a slightly different angle:

the

labour-process (the general) is the pre-condition for all human life,

the process in which man effects an exchange of matter between
himself and nature, what Marx refers to as 'the everlasting Natureimposed condition of human existence, and therefore common to every
such phase'.

(I, 184).

in this general form.

But this process of labour can never exist

For Marx, unlike the political economists

with their fondness for stories of Robinson Crusoe, man can never
confront nature outside definite social relations.

This is the point

made in The German Ideology:

"In production, men not only act on nature but also on
one another. They produce by co-operating in a certain
way and mutually exchanging their activities. In order
to produce, they enter into definite connections and
relations with one another and only within these social
connections and relations does their action on nature
take place."15
Thus the general process of labour exists only in connection with
definite, specific forms.

Man's relation with nature has a definite

material basis which cannot of course be ignored in any society;

order to live, all societies are obliged to appropriate cartain
things from nature and transform them into things for use (usevalues).

Without such a process life is rendered impossible.

129

But

in

at the same time such a process can only take place through relations
between men which are 'independent of their will and consciousness'
in that they reflect not some subjective choice but the stage reached
in the development of the material forces of production in each epoch
of history.
Indeed it is possible to see Marx's task in Capital as turning on
this essential question:

to show how certain universal features

common to all societies (the labour process) found their peculiar

expression within a determinate form of society - capitalism.

Only

in this way - if this task were successfully completed - would it

be possible for Marx to demonstrate that capitalism was not some

eternal mode of production without barriers to its continued development, as the apologists for it claimed.

Capital, by expressing the

universal laws of production in its own peculiarly specific form,

aided enormously the development of the productive forces; but at
the same time, this specific social form is the source of capital's
definite historical limits.

Marx, perhaps more than anybody else,

recognised the considerable role played by capitalism in the development of the productive forces, and its 'civilising mission' is one
of the central themes of the Manifesto.

But it was only through the

effort to relate capitalism to the whole line of social development

that Marxism was able to rise above Utopian socialism with its
abstractly moralistic attitude to capitalism.

The fact that there

had been such a dramatic increase in the productivity of labour

with the advent of capitalism(and it was this increase which provided
one index of capitalist development) could not be deduced from the
process of labour viewed

~s <1 ~8terial

activity but only from the

social form (the essence of which was the production of surplus

130

value) in which this universal material process took place.

Clearly we are dealing in this instance with the relationship
between a general category and its specific particular form.

The

same methodological principle we have noted in connection with the

labour process is also present in the analysis of the commodity the starting point for Marx's investigation in Capital.

The manner

in which Marx develops his work from the analysis of this 'cell-form'
of bourgeois economy will be the specific subject of the next
chapter, and here we concentrate on only one aspect of the matter.
Just as in the investigation of the labour process Marx starts not
from the peculiar social form which this process assumes under
capitalism, so in the analysis of the commodity he starts not with
'value' but with 'use-value'.

That is to say, he starts with the

substance of wealth found in all societies, with a universal category.

Only after making clear that commodities are 'in the first place'
use-values does Marx then proceed to point out the 'peculiarity' of
commodity production, namely that under these conditions use-values
are the bearers of a definite social relation, the value relation.
Use-values constitute the substance of all wealth, whatever may
be the social form of that wealth.

In the form of society we are

about to consider they are, in addition, the material depositories of

exchange-values.

.( I,. 36).

Here again, Marx is stressing that the

production of use-values is an objective process which cannot be

dispensed with in any epoch.

But it would be a mistake to believe

that the creation of use-values involves only technical processes,

for in creating wealth men at the same time involve themselves in a

131

definite mode of life.

A mode of production must not be thought of

'simply as being the production of the physical existence of the

individuals.

Rather it is a definite form of the activity of these

individuals, a definite form of expressing their life, a definite

mode of life on their part.,16
We now turn to the question of the law of value as an illustration
of Marx's procedure in arriving at concepts in Capital.

We start

with a short summary of Marx's findings, as they appear in the early

part of this work.

In the course of the exchange of commodities,

such commodities are rendered equal despite their many different

qualitative characteristics;

or more strictly speaking, the very

fact that commodities do have qualities which differ so markedly

(that is to say they have various use-values) makes it alone possible
to establish an equality between them.
exchange of boots for boots!

There is no basis in the

Marx aims to show that a 'third' factor

alone makes it possible to establish a relationship between two

quite distinct commodities, and that this third factor is their
value.

'Therefore the common substance that manifests itself in the

exchange-value of commodities, whenever they are exchanged, is their

value.' (1,29).

And Marx proceeds to point out that the emergence

of this category value and therefore man's ability to conceptualise

it, related directly to human practical activity.

But while the

establishment of commodity production was the sole basis on which

the category of value could emerge, it requires a high level of the
development of such production and eXChange before it was possible
to discover this category.

Thus 'Although an abstraction, this is

132

an historical abstraction which could only be evolved on the basis

' 1 ar
of a par t ~cu

'

econom~c

d eve 1 opmen t 0 f SOCla

. t y. ,17

The point can

be put as follows: while the exchange of commodities remained at a

low stage of development, while such exchange occurred on the
edges of communities which remained largely and in normal times
self-sufficient it was impossible to abstract and therefore
conceptualise the category value.

For while exchange remained

strictly limited and sporadic, it could still be concluded that the

exchange of commodities was regulated by lUCK or the cunning of the
parties concerned.

Only with the generalisation of commodity

exchange - signified by the appearance of money and its general use was it possible to abstract the concept of value.

Only when

political economy was able to infer on the basis of its investigations

that all commodities can be exchanged for each other in definite
proportions was it possible to conclude that there must be something
in common between them, a common substance, namely value.
The ability to detect in commodities a common substance did not
however mean that an adequate concept of value had yet been arrived
at.

The abstraction of a new property in a series of phenomena does

not yet mean that the essential nature of this property has been
understood.

To reach an adequate concept of value it was necessary

to discover the origin and source of this common property.

And this

could only be achieved on the basis of further investigation, notablY

of the category 'labour', a category which went largely unexamined in
classical economics.

Marx went on to argue that value is nothing but

the embodiment of human labour in the abstract, the quantity of which

is measured by socially necessary working-time.
133

It became possible

to get to the essence of value, to define this concept adequately,

only under conditions of developed capitalist production, where
the equality and equivalence of all forms of labour was for the
first-time revealed, when the predominant relationship between
people became that of commodity producers and when producers were
finally separated from the means of production and labour power
itself was reduced to the status of commodity.
Here again is an expression of the fact that for Marx all concepts,
far from being generated in thought, are merely a reflection of
historical development, and specifically of the historical development of the production relations between men.

In this respect,

Marx's comments on the role played by Aristotle in the analysis of

value have considerable interest.

Marx points out that Aristotle's

genius allowed him to grasp that the money-form was only a further
development of the simple form of value.

(In this respect at least

it is possible to argue that Aristotle's achieveme,nts in the ancient

world stood ahead of those of political economy in the eighteenthcentury.)

Marx

goe~

on to note that Aristotle saw that it was also

the case that if two commodities were exchanged it necessarily

followed that they were equal to each other in a qualitative sense.
Marx quotes Aristotle 'Exchange cannot take place without equality,
and equality without commensurability.' (I, 59).
says Marx, Aristotle stopped.

At this pOint,

He found it impossible, despite what

he had said, to conceive of any commensurability between such

qualitatively different commodities.

Now Marx proceeds to a remark

which has direct bearing on the issues under examination: 'Aristotle

therefore, himself, tells us, what barred his way to further
134

analysis, it was the absence of any concept of value'. (emphasis

added) (I, 59).

His profound insight that that when commodities

exchange they do so on the basis of commensurability, and his

further insight that money, that universal form of value, grows
out of commodity circulation, were, in themselves an inadequate basis
for the formation of a concept of value.

In Marx's opinion this

was the result of the specific social conditions prevalent during

Aristotle's life, in particular the form of labour dominant in the
ancient world:
"There was however an important fact which prevented
Aristotle from seeing that to attribute value to
commodities is merely a mode of expressing all labour
as equal human labour, and consequently as labour of
equal quality. Greek society was founded upon slavery
and had, therefore, for its natural basis, the
inequality of men and their labour powers. The secret
of the expression of value, namely that all kinds of
labour are equal and equivalent because and so far as
they are human labour in general, cannot be deciphered,
until the notion of human equality has already acquired
the fixity of a popular prejudice. This, however, is
possible only in a society in which the great mass of
the products of labour takes the form of commodities,
in which consequently, the dominant relation of man and
man is that of owners of commodities. The brilliance
of Aristotle's genius is shown by this alone, that he
discovered, in the expression of the value of commodities,
a relation of equality. The peculiar conditions of
society in which he lived, alone prevented him from
discovering what 'in truth' was at the bottom of this
equality." (I, 60).
This passage serves to indicate that it was only with the eighteenth
century that real strides forward were made in uncovering the riddle
of the value relation.

It was only when the notion of human

equality - and the equality of human labour power had, because of

definite economic conditions, become established in man's mind as a
prejudice, that the real secret of value could finally be discovered.
135

Here lies the clue to seeing not only why the eighteenth century
should bring such advances in the field of political economy and
provide the beginnings of solutions to economic problems which had
eluded the minds of thinkers from the time of the ancient world
onwards, but at the same time why these advances were of a strictly
limited nature.

It was precisely because the commodity form of

wealth was becoming all-persuasive that it Was in fact treated as

a prejudice' to use Marx's word.

The existence of generalised

commodity production - which was in fact the basis for all its
advances - was taken axiomatically by political economy, as a fact
SO

obvious as requiring little investigation.

It could not grasp

that the ability of political economy to transcend the limits of

Aristotle was rooted in entirely historical conditions.

Lenin's

comment on the syllogism is perhaps appropriate here by way of an

analogy:

'The practical activity of man had to lead his conscious-

ness to the repetition of the various logical figures thousands of

millions of times in order that these figures could obtain the
significance of axioms.'

(LeW 38, 217).

So for Marx the emergence of the value concept was intimately bound
up with the history of man's 60cial practice, although man was far
from being aware that this was the case.

But let us consider some-

what more closely how the concept of value actually arose in

political economy, and more specifically how it took shape in the
minds of the thinkers concerned.

It was William Petty who in the

modern world made the earliest and most significant step towards
the elaboration of a theory of value.

This is how Patty posed the

matter 'If a man can bring to London an ounce of silver out of the

Earth in Peru, in the same time that he can produce a bushel of Corn,
then one is the natural price of the other.' (Th, 1,356) .

In' other

words, in actual fact, in spite of any axioms and precepts it may

have professed, political economy did not arrive at the notion of
value by seeking some common, abstract, element found in all
commodities (which general usage had long previously united in the
term 'value').

In point of fact, as Petty himself makes clear, its

procedure was quite different, indeed the very opposite.

It

started with one particular relationship (here the case of silver

and corn, in the case of Smith, beaver and deer).

This was the

simplest economic relationship, simplest because historically the

first.

It then attempted to move from this simple relationship to

a more general one - this involved the analysis of maney, interest,

capital, etc.

tor Marx this was the undoubtedly correct scientific

method and he levelled no criticism against political economy on

this particular score.

The political economists had groped their

way empirically towards a correct conception of value.

But having

arrived at this concept, they attempted to verify it according to

the canons of formal logic, relying principally on Locke, in the
manner already noted above.
That is to say, in attempting to arrive at the concept of value,
political economy proceeded from the simplest determinations to
ones of a richer and more concrete character.
settles the issue of a correct procedure.

But this by no means

We have already stressed

in an earlier chapter that Ricardo's method ignored, said Marx, any

conception of a mediation between the simplest determination and
their more concrete and complex development.
1 :57

The exchange of

commodities, taken as a whole, could be deduced from the exchange of

two commodities:

this was implicitly accepted by Ricarda.

And when

empirical evidence suggested that this was not the case, the simple
determination was either held to be an approximation only, or, in
the more extreme case, abandoned entirely.

It was an this point

that a considerable gulf separates Marx from political economy.

For

Marx the general is no mere mechanical summation of the various

individual phenomena, but is expressed in the real concrete interaction of these phenomena, as something which reveals itself in a
tendency.

And such a tendency can only one-sidedly and incompletely

capture the wealth of all the particulars.

Thought,

~Iarx

held, must

proceed from the abstract to the concrete not in a mechanical manner

but through a combination of abstractions.

Here again, on the very

basic questions of the method of political economy, Marx sided with

the dialectical conception of Hegel, rejecting the empirical outlook
of classical political economy.

One aspect of empiricism which

Hegel trenchantly attacks in his work lay in its tendency to rely

over-much on the method of analysis, while paying inadequate
attention to the question of synthesis.
"In the impression of the senses we have a concrete of
many elements, the several attributes we are expected
to peel off one by one, like the coats of an onion
Empiricism therefore labours under a delusion if it
supposes that while analysing its objects, it leaves
them as they were: it really transforms the concrete
into an abstract. As a consequence of this change the
living thing is killed: life can exist only in the
concrete and the one. Not that one can do without this
division, if it be our intention to comprehend The
error lies in forgetting that this is only one half of
the process and the main point is the reunion of what
has been parted."19
Thus the concrete could not be assembled from a straightforward

addition of the constituents from which it was composed, any more

than society could be conceived of as a mere addition of the
individuals of which it was composed.
of abstractions in that the
to be studied;

The concrete was a combination

relations composing the whole had

they could not be deduced from a knowledge of the

simplest phenomenon.
It must also be emphasised that while the movement from the abstract
to the concrete

,~

the only way of thinking by which the concrete is

grasped and reproduced in our own mind as concrete' (G, 101), we

must be careful not to see this process in a one-sided manner.

for

such a process would have been impossible - in the history of

political economy at least - if there had not been a prior movement
in the opposite direction.

Although Hegel might have attacked

empiricism for its one-sided emphasis upon the role of analysis,

analysis does, nontheless, constitute an indispensible element in
human thought.

Very clearly in the case of political economy, it

was only after a mass of material had been sifted out that the
science could move forward.

Thus while thought moves from the

abstract to the concrete 'this is by no means the process through

which the concrete itself comes into being'.

(G, '101).

That is

the abstractions from which political economy began presupposed a

definite and concrete form of society 'Hence in the theoretical
method, too, the subject, society, must always be kept in mind as
the presupposition.' (G, 102).

Thus in the analysis of money (a

complex relation) it was necessary to begin the analysis from a

simpler category (exchange-value);
to the more concrete.

to move that is from the abstract

But it must not be forgotten that the category

1 :39

can never exist independently of the whole (society) of which it

is in reality part.

Thus 'the simplest economic category e.g.

exchange value' in its completed form 'can never exist other than
as an abstract, one-sided relation within an already given, concrete
living whole'.

(G, 102).

This is an important point to bear in mind, for otherwise it might

seem that we are dealing with a process which simply involves the
transition from concept to concept.

This is a charge which has

indeed been levelled by some against the so-called 'capital-logic'

school, although the charge would seem to be without foundation.
One of the central pOints, to which we have several times returned,
is that unlike political economy, Marx was conscious of the
historical and material basis for the categories with which it
operated;

once this point

grasped then there could be no

possibility of forgetting that in the movement of economic concepts

(assuming always that they were accurate and adequate concepts) was
expressed the movement of definite, objective social relations of
production.
As a final instance of the nature of the concepts which form the
basis of Capital we can consider the concept of capital itself.

For

Marx it is clear that an understanding of this category was the

essential pre-condition for the understanding of the nature and law
of motion of modern society.

'Capital is the all-dominating economic

form of bourgeois society - it must form the starting point as well

as the finishing-point', says Marx at one pOint.

(G, 107).

repeated with even more force when Marx says the following:

140

This

"The exact development of the concept of capital {Ii!

necessary since it is the fundamental concept of modern
economics, just as capital itself whose abstractly
reflected image ~~ its concept ~~ the foundation of
bourgeois society. The sharp formulation of the basic
presuppositions of the relation must bring out the
contradictions of bourgeois production as well as the
boundary where it drives beyond itself." (G, 331).
The classical economists often understood capital to mean accumulated
labour which served as the means of new labour.

However, observes

Marx, it is just as impossible to proceed from labour directly to

capital as it is to move from nature to the steam engine.

Marx

objects to this conventional definition because it said little more

than that capital was a means of production, and on this basis
capital would have existed and functioned in all forms of society
and must therefore be something purely a-historical.

Dealing

incidentally with the point raised earlier about the content and
form of economic relations Marx in effect says on this question of
the definition of capital found in classical economics:

If the

specific form of capital is abstracted away and only the content

is emphasised, as which it is a necessary moment of all labour,

of course nothing is easier than to demonstrate that capital is a

necessary condition for all human production.

The 'catch' in the

definition of political economy, Marx argues, is that if it is the

case that all capital consists of objectified (accumulated) labour
which serves as a means for new production, it by no means follows
that all objectified labour which serves as means of new production
is necessarily capital, as political economy implied.
The root problem of the definition of capital adopted by the
political economists was that for them capital was understood as
a thing and not as i t really

wa~

141

a social relation, albeit one which

attached itself to a thing.

Now in what respect is capital a 'fundamental' category for the
investigation of modern society?

For Marx it was such a category

because it contained within itself implicitly all the lower

categories which were its presuppositions, its historical and
theoretical bases.

To grasp the nature of capital was therefore

the necessary pre-condition for an understanding of the lower

economic relations (value, money, etc.) out of which it had grown,
grown in bath a historical and logical sense.

To 'define' capital

for Marx in this sense meant to grasp conceptually the origin and
development of this basic relation of modern society.

Only if this

were done would it be possible to grasp the connection between the

various categories and the path of transition from one to the other.
Of course relations which were predominant in earlier social
formations continue to survive in present day capitalist economy,
but they survive always, Marx suggests, in a position of subordination, in a truncated and distorted farm.
Given that capital now dominated all pre-capitalist economic relations,
these latter relations could only be understood in their living organic
connection with capital in modern society.

At one pOint Marx says

that it would appear correct to investigate the economic categories in

the order in which they had actually appeared in history, just as, by
analogy, it might appear correct to deal with the anatomy of the ape
before that of man.

As far as political economy goes, this would seem

to suggest that one ought to deal first with rent (landed property)
then interest (mercantile capital) and then finally with profit
(industrial capital).

But such a method, holds Marx, would be

'impossible and wrong'.

The economic categories cannot be considered

in the sequence in which they evolved:

"Their sequence is determined, rather, by the relation to
one another in modern bourgeois SOCiety, which is
precisely the opposite of that which seems to be eheir
natural order or which corresponds to historical development. The point is not the historic position of ehe
economic relations in the succession of different forms
of society Rather their order within modern bourgeois
society." (G, 107-08).
But if capital is the predominant category, we are faced with a
seeming paradox.

tor in Caoital Marx starts, not with the concept

of capital, but with the commodity.

Only later - from chapter four

onwards does he begin to deal with capital.

This paradox is

explained by Marx in the distinction which he draws between the

mode of presentation of his work and the path of inguiry which had
enabled him to present his material in abstract form.

It is clear

from the many drafts which the earlier chapters went through that
Marx grappled at length with the problem of how best to present
the results of his work.

This was particularly the case with those

sections of the first chapter which dealt with the analysis of the
value-form.

On this distinction between mode of presentation and

form of inquiry Marx says

"Of course the method of presentation must differ in form
from that of inquiry. The latter has to appropriate the
material in detail, to analyse its different forms of
development, to trace out their inner connection. Only
after this work is done, can the actual movement be
adequately described. If this is done successfully, if
the life of the subject matter is ideally reflected as
in a mirror, then it may appear as if we had before us a
(I, 19).
mere a criori construction."
This last point made by Marx must be taken seriously in the light
of those suggestions that the development of Capital is merely the

143

movement of a series of categories, which are manipulated by the

author, Hegelian fashion, to produce the desired results.

~a~x

insists that contrary to the appearance of the matter, we are not

dealing with a mere a-priori construction.

Marx had to derive the

concept of capital, and this process of derivation involved much

patient work over a long number of years.
can be seen in Capital.

The fruits of this work

But it is illegitimate to concentrate

attention to the fruits, the results, without inquiring into the

conditions under which that fruit was produced.

Marx says

specifically that categories are 'a product of the working up of

observation and conception into concepts' (emphasis added).

(G, 101).

Marx is again insisting that his work should not be regarded as

merely a dialectical elaboration of concepts in Hegelian fashion.
It is based on a thorough analysis of the concrete historical conditions which led to the formation of the capitalist mode of production.
The basic premise for the existence of the concept of capital is, for
Marx, the fact that the owner of money, the capitalist, 'can exchange
his money for another's ability to work, as a commodity';

however

the fact that the owner of capital does find such a commodity - and
this says Marx is 'the presupposition from which we set out and which
forms the starting point for the production process of bourgeois
society'
"is clearly the result of a long historical development, the
resume of numerous economic charges, and presupposes the
decline of other modes of production and a particular
development of the productive powers of social labour".
This is the key to understanding the paradox noted above:

for while

capital is the central economic category of capitalist economy, its

144

analysis can and indeed must start from a simpler economic relation,
the commodity, as Marx explains in the following passage:
"The general concept of capital can be derived from the
study of simple circulation, because, within the bourgeois
mode of production simple circulation itself exists only
as a presupposition of capital and presupposing it." (G,261 ).
Simple commodity circulation which only becomes the general form
which penetrates the entire economic organism under the rule of
capital, represents no more than an 'abstract sphere' within this
mode of production 'which establishes itself as a moment, the form
of appearance of a deeper process, that of industrial capital which
lies behind it and which both produces it and springs from it'.
(G,261 ).
In dealing with the problem of the formation of concepts, we are, in
effect dealing with an aspect of the relationship between the
individual and the general.

Mention has already been made of the

concept of 'capital in general' but it will be useful to return to it

at this point as part of the discussion about the nature of the
concept of capital.

It is Rosdolsky perhaps more than anybody else,

certainly in the recent literature, who has drawn attention to the

centrality of this concept for the structure of Marx's Caoital.

Let

us, in following Rosdolsky's analysis, recall what was said earlier

about this concept.

Rosdolsky argues that Marx could not start from

the existence of each individual unit of capital, taken in isolation,

as a purely external form.

This would have been to start from the

external, outward appearance of economic relations, to start that

is from the same position as vulgar economy.

In practice, each

capital appears in relation to each other in the sphere of competition,

145

but beneath this surface and through all the contradictions of

competition there remains the undobuted fact that all the individual
capitals constitute the capital of the whole of society.

The

existence of these individual capitals in their movement reflects

social laws;

because of the inherent anarchy (anarchy meaning the

absence of an a-priori regulation or plan) of capitalist economy

these social laws can only assert themselves and reveal their nature
'behind the back' of the individual capitalist and in opposition to
his consciousness.

We are in effect returning to the proposition

that all laws of social development can operate only in a roundabout,

mediated, and indirect manner and only on the basis of continual
deviations from an average.

If this is the case then an adequate

theory of political economy cannot be based merely upon a study of the

market;

to confine attention exclusively to this realm was in fact

to start from the level of consciousness, that is from the manner in

which the laws appeared to operate to the individual participants in
the processes of production and exchange.
For Marx the concept of 'capital in general' was meant to convey not
merely the summation of all the individual capitals as they appeared
in competition.

Political economy - with Ricardo again in the lead -

had recognised the need to abstract from the manner in which capital
appeared in the sphere of competition.
abstractions were formal and incomplete.

But, charged Marx, its

It had attempted to reduce

all economic relations to a basic substance (labour), attempting

thereby to construct a general nation out of a common element it
discerned in all economic forms.
different:

Marx's approach was here qUite

in seeking the essential nature of capital (capital in

1~

general) he attempted to trace the development of capital out of its

lower economic forms (commodities, money).

In so doing

~arx

aimed

to point to the peculiarities of capital, peculiarities which

separated it from these lower forms.

Thus, to give a specific

example, Marx showed that while capital cannot exist independently

of money, equally it cannot be reduced to this lower form.

It was

for this reason that Marx objected to those who believed that the
contradictions of capital could be overcome through the abolition
of money.

But, thought Marx, equally serious mistakes arose when

higher economic forms were mechanically reduced to lower forms when, for instance, capital is conflated with one of its specific
forms, say money capital.

Marx's conclusion:

capital is value, but

value of a peculiar type, namely self-expanding value;

it is a

social relation which, attached to a thing, appropriates surplus

value created in a definite process of production, and it thereby
continually creates capital and the relation of capital itself.

The

origin of this surplus value (which was merely taken as given by the
classiral economists) was established by Marx without any reference
to individual capitals, or to the relations between them.
the point can in a sense be even more forcefully put.

Indeed

To have dealt

with the immediate form of economic relations - as they were seen

empirically within the sphere of competition - would, Marx believed,
have rendered impossible an uncovering of the process by which
surplus value is extracted from wage labour.

In the Form it takes

as profit, surplus value appears, at first view, to be created in

equal amounts by all sections of capital and, as such, capital
appears to be source of wealth, quite independent of labour.
147

It was

therefore essential for Marx, given the tasks which he had set himself,
that he should disclose the nature of this 'capital in general' before
he dealt with its specific, immediate forms (profit, interest and
rent) and why he felt it necessary to deal with the nature of surplus
value in general before dealing with the specific forms which it
assumed, as profit, rent and interest.

It is significant in the

context of this examination of Marx's method that Marx considered

this latter differentiation - between surplus value as a general
concept and its specific forms - to have been one of the two best
points in Capital.

(The other was the distinction between concrete

and abstract labour.)

A common objection to Marx's conception of 'capital in general' is
that it does not deal with the concrete reality of capitalism, that
it is an abstraction which is unable to deal with crucial problems
such as the rate of profit on a particular enterprise.

Here once

more the important questions are as much to do with philosophical

methods and positions as they are with economic theory.

for Marx

at least, abstractions - if they were adequate - had a powerful

objective character and this they have precisely because they embrace
the wealth of all the phenomena concerned.

A lead towards an

understanding of Marx's position is again provided by Hegel;

attack-

ing those who wanted to raise what was immediately given in perception
to the status of the sale legitimate source of knowledge, Hegel says
"Abstract thinking, therefore, is not to be regarded as
a mere setting aside of the sensuous material, the
reality of which is not thereby impaired; rather it
is the sublating and reduction of that material as mere
Ehenomenal appearance to the essential which is manifested
only in the Notion.,,19

148

Lenin's comment is also relevant to the question of the reality of

abstractions:
"Essentially, Hegel is completely right as opposed to Kant.
Thought proceeding from the concrete to the abstract
(Provided it is correct (N8 (and Kant, like all philosophere
speaks of correct thought) - does not get away from the truth
but comes closer to it. The abstraction of matter; of a law
of nature, the abstraction of value, etc. - in short all
scientific (correct, serious, not absurd) abstractions reflect
nature more deeply, truly, and completelY.~ (Lew 38, 171).
It was because abstractions, if accurate, do not get away from reality
but actually come closer to it that Marx says, specifically of capital
in general
"as' distinct from the particular real capitals, is itself a
real existence capital in this general form, although
belonging to individual capitalists, in its elemental form
of capital, forms the capital which accumulates in the banks
or is distributed through them while the general is
therefore on the one hand only a mental mark of distinction
it is at the same time a particular real form alongside the
form of the particular and individual". (G, 449-50).
It is clear that, once more, we are in fact discussing the relationship
between the 'individual' the 'particular' and the 'general'.

The

notion of capital in general was not arrived at by means of a

mechanical summation of each unit of capital;

nor is it an abstraction

based on some dead uniformity found in each capital.

The total social

capital consists of the ensemble of all the individual capitals in

their dynamic relations.

Dealing with the movement of this social

capital, Marx says

"However the circuits of the individual capitals intertwine,
presuppose and necessitate one another, and form, precisely
in this interlaCing, the movement of the total social
capital. Just as in the simple circulation of commodities
the total metamorphOSis of a commodity appeared as a link
in the series of metamorphoses of the world of commodities,
as now the metamorphosis of the individual capital appears
as a link in the seri~s ~f metamorphoses of the social
capital." (II, 352).
149

And what is true of individual capitals is true of particular forms

which it assumes as fixed, circulating, variable, etc.
"Capital as a whole, then, exists simultaneously, spatially
side by side, in its different phases. But every part
passes constantly and successively from one phase, from
one functional form, into the next and thus functions in
all of them in turn. Its forms are hence fluid and their
simultaneousness is brought about by their succession.
Every form follows another and precedes it, so that the
return of one part of capital to a certain form is
necessitated by the return of the other part to some other
form. Every part describes continuously its own cycle,
but it is always another part of capital which exists in
this form, and these special cycles from only simultaneously
and successive elements of the aggregate process." (II, 104).
And in its development, this total social capital asserts itself
against the individual owner of capital.

Thus

"'If social capital experiences a revolution in value, it may

happen that the capital of the individual succumbs to it
and fails, because it cannot adapt itself to the conditions
of this movement of values.' And in the same passage Marx
speaks of this movement as operating 'with the elemental
force of a natural process, against the foresight and
calculation of the individual capitalist'." (II. 106).
The development of Marx's analysis throughout the three volumes of
Capital can be seen as an attempt to demonstrate that the further
development of the capitalist system brings increasingly to the
forefront the actual power of this social capital as against the
individual unit of capital.

This says Marx is brought out with

great clarity in the case of the banking and credit system.

for in

the form of banking and credit capital all the actual and potential
capital of society is placed at the disposal of industry and
commerce.

In this sense banking and credit

"does away with the private character of capital and thus

contains in itself, but only in itself, the abolition of
capital itself banking and credit thus become the
most potent means of driving capitalist production beyond
150

its own limits, and one of the most effective vehicles

of crisis and swindles." (III, 593).
This theme - the manner in which capital develops through its various
forms - and the connection between this movement and the tendency
towards crises of various sorts will form the subject matter of a
later chapter.

151

Chaptar 5
THE

SIGNIfICANCE

OF

THE

OPENING

CHAPTERS

OF

'CAPITAL'

A correct understanding of the opening chapter of Capital was, for

Lenin, a vital pre-condition for understanding the work as a whole.
And, as we have already noted, if such an understanding was to be
achieved it was necessary in Lenin's view to study the dislectic of
this first chapter.

What is the status of this opening chapter in

which Marx subjects the commodity form of labour to a detailed

investigation?

In the Preface to Capital Marx himself warns us not

to underestimate the importance of the analysis of this, the 'ce11form' of capital, while at the same time also warning that the real
problem for any science lies always in its beginning.

Thus:

"Every beginning is difficult, holds in all sciences.

To understand the first chapter, especially the
section that contains the analysis of commodities, will
therefore present the greatest difficulty. That which
more especially concerns the analysis of the substance
of value and the magnitude of value, I have as much es
it was possible popularized. The value-form, whose
fully developed shepe is the money-form, is very
elementery and simple. Neverthelees, the human mind has
for more than 2,000 years sought in vain to get to the
bottom of it, whilst on the other hand, to the successful analysis of mora composite forms there has baen at
least an approximation. Why? Because the body as an
organiC whole, is more easy to study than are the cells
of that body To the superficial observer, the
analysis of these forms seems to turn upon minutiae. It
does in fact deal with minutiae, but they are of the same
order as those dealt with in microscopic anatomy."
(Preface to I, 1-8).
What should we make of this passage?

I think this:

The commodity

is the cell-form of bourgeois society because it is the basiC

relationship of that sociaty, basic in a double sense.

First the

economic relation, while of course not the only relation in society,

152

is certainly the simplest and one found historically prior to all

others.

Our method, Engels tells us, 'starts from the simplest

fundamental relations we can find historically, in actual fact,

that is economic relations'.

Here is a point which has direct

bearing upon and implications for the theory of historical

materialism.

tor Engels is, in effect, saying hera that economic

relations (relations between men in the course of producing their

material existence) are the ones found again and again as moments
in more complex relations (political, religious, ideological,
etc.).

The simplest relations are moments which stand at the

basis of and are involved in the richer more concrete determinations,

but of course these economic relations do not exhaust the higher
relations, any more than biology can be understood simply from the
point of view of chemistry.
But the commodity form is a fundamental category in a second sense.
Historically capital grew out of simple commodity production.
'Small scale production' Lenin explained, 'engenders capitalism and
the bourgeoisie continuously, daily, hourly, spontaneously and on a
masS scale' (LeW, 34, 24).

Exchange value has, at particular points

in time, constituted a dominant and essential economic category:

antiquity and in the economy of the Middle Ages.

in

Under modern

capitalism it is in one respect 'antediluvian' in that it has besn

transcsnded, sublated into higher and richer economic forms.

Yet it

none the less remains the basic and fundamental economic relation:
but for the exchange of commodities there could be no world market,
no commercial, industrial or finance capital.

153

In this respect the

study of the commodity-form can be likened to the study of the simplest

form of the movement of capital, one that lies at the base of all the
higher, more developed forms.

The connection between Marx's pro-

cedure and the history of science is worth noting.

Engels says, in

connection with the study of the most elementary forms of motion.

'The investigation of the nature of motion had, as a matter of course,
to start from the lowest, simplest forms of this motion and to learn
to grasp thesa befora it could achieve anything in the way of
explanation of the higher and more complicated form;' 1 and, adds
Engels,
"All motion is bound up with some change of place, whether
it be change of place of heavenly bodies, terrestrial
messes, molecules, atoms or other particles. The higher
the form of motion, the smaller this change of place. It
in no way exhausts the nature of the motion concerned, ~
it is inseparable from the motion. It therefore has to be
investigated before anything else." 2
In this sense, an investigation of the commodity, an analysis of its
inherent contradictions, a study of how those contradictions grow
and reveal themselves on the surface of society remains an
indispensable basis for the study of capitalist development.

But,

having said this, we should not at the same time be unmindful of a

certain danger here.

It is this:

while a real study and grasp of

the early chapters of Capital is vital, it would be wrong to think

that these chapters can in any way exhaust all the complexities in
the development of capital, any more than the mechanical form of
motion exhausts the higher forms of motion.

In response to

Lachatre's plan to bring out a french edition of Capital in serial

form, Marx, while recognising that this would make it more

154

accessible to the working class ('a consideration which to me outweighs everything else') also warned of the dangers involved in
such a proposal.

The danger lay in the fact that

"The method of enalysis which I have employed, and which

had not previously been applied to economic subjects,
makes the reading of the first chapters rather arduous,
and it is to be feared thet the french public, always
impatient to come to a conclusion, eager to know the
connection between general principles and the immediate
questions that have aroused their pessions, may be disheartened because they will be unable to move on at
once." (I, 21).
This question of the relationship between 'general principles' and
'immediate questions' is further complicated by the fact that
Marx's projected plan of work for Capitel was left incomplete at
his death.

In 1857 his plan envisaged the following structure for

the work:
1

The book on capital

The book on landed property

The book on wage labour

The book on the state

The book on foreign trade

The book on the world market and crises

Even on the level of economic relations (leaving aside political,

ideological, etc. factors) Marx's work was therefore incomplete:
of the above six prOjected parts, only the first three were
completed (and even here the majority only in draft form which
Engels subsequently edited for publication).

It is important to

keep this incompleteness in mind and for the following reason:

is clearly impossible to get fully to the driving forces of the
crises of capital without taking the analysis to the level which
155

it

Marx was evidently noping to deal with (Books 4-6).

Let us give a concrete instance of the sort of implications which
this involves.

It would clearly be naive to attempt an explanation

of the structure and crisis of the present world monetary system

by mere reference to what Marx says on the question of money in
Capital (and even more naive to restrict oneself to what he says in
the early chapters of Volume 1).

While, of course, this specific

question will not be our concern here, it is apparant that an

examination of the role and structure of the International Monetary
fund, established following the 1944 Bretton Woods negotiations,
cannot be carried out merely by looking into the pages of Capital.
for the particular crisis of the world money system, with which
Bretton Woods tried to grapple, is a product of the entire development and decline of capital in the present century.

A proper study

of the world money system from a Marxist standpoint would in point

of fact require amongst other things a detailed consideration of
imperialism, its development since Lenin, together with a study of
the relations between nation states (and particularly the reletionship between Europe and America) along with an analysis of the role
of the state in the economy ('Keynesianism', etc.).
would not be exhaustive.

And even this

But all these factors and others would

have to be analysed in the light of Marx's work in Capital.

Engels gives a characterisation of the early chapters of the Critique
which applies equally well to Capital.

Reviewing the Critique and

drawing attention to its dialectical method, Engels writes:

"Even after the determination of the method, the critique
of economics could still be arranged in two ways - historically
or logically. Since in the course of history, as in its
156

literary reflection, the evolution proceeds by and large

from the simplest to the more complex relations, the
historical development of political economy constituted a
natural clue, which the critique could take as a point of
departure, and then the economic categories would appear
on the whole in the same order as the logical exposition.
This form seems to have the advantage of greater lucidity,
for it traces the actual development, but in fact it would
thus become, at most, more popular. History moves often
in leaps and bounds and in a zigzag line, and as this
would have to be followed throughout, it would mean not
only that a considerable amount of material of slight
importance would have to be included, but also that the
train of thought would frequently have to be interrupted;
it would, moreover, be impossible to write the history of
economy without that of bourgeois society, and the task
would thus become immense, because of the absence of all
preliminary studies. The logical method of approach was
therefore the only suitable one. This, however, is indeed
nothing but the historical method, only stripped of the
historical form and diverting chance occurrences. The
point where this history begins must also be the starting
point of the train of thought, and its further progress
will be simply the reflection, in abstract and theoratically
consistent form, of the historical course. Though the
reflection is corrected, it is corrected in accordance with
laws provided by the actual historical course, since each
factor can be examined at the stage of development where it
reaches full maturity, ita claSSical form." (Critique, 225).
Here Engels is again stressing the unity of 'logic' and the actual
historical development.

Capital ie a reflection of the actual course

taken by the emergence and decline of a social system, a reflection

in that it sums up this movement in a series of concepts.

After

stressing this point, (ngels provides a brilliant sketch of the way

in which Marx developed this method.

Marx started, says (ngels, with

the simplest relation to be found, the economic relation first

encountered.
"We analyse this relation. The fact that it is a relation
already implies that it has two aspects which are related
to each other. Each of these aspecta is examinad
separately; this reveals the nature of their mutual
behaviour, their reciprocal action. Contradictions will
emerge demanding a solution. But since we are not examining an abstract mental process that takes place solely in
157

our mind, but an actual event which really took place

at some time or other, or which is still taking place,
these contradictions will have arisen in practice and
have probably been solved. We shall trace the mode of
this solution and find that it has been effected by
establisning a new relation, whose two contradictory
aspects we shall have to set forth and so on.~ (Ibid, 225-6).
Very important here is Engels' emphasis upon practice.

The

theoretical concepts which Marx abstracts in the course of his

investigations are abstracted from human practice;

we are dealing

here with 'an actual event' which thought must accurately depict.
And because we are dealing with an ever-changing reality our
concepts must reflect this continual change;
each other.

they must flow into

Engels now goes on to draw attention to the fact that

in the relations between things are expressed definite social

relations, that is, definite forms of practIce.

Thus:

"Political economy begins with commodities, with the moment

when products are exchanged, either by individuals or
primitive communities. The product being exchanged is a
commodity. But it is a commodity merely by virtue of the
thing. the product being linked with a relation between
two persons or communities, the relation between producer
and consumer, who are at this stage no longer united in
the same person economics is not concerned with things
but the relations between persons, and In the final analysis
between classes; these relations however are always bound
to things and aepear as things. Although a few economists
had an inkling of this connection in isolated instances,
Marx was the fIrst to reveal its significance for the entire
economy thus making the most difficult problems so simple
and clear that even bourgeois economists will now be able to
grasp them." (Ibid, 226).
And Engels continues his review by stressing the enormous superiority
of dialectical thought as against the old metaphysics.
"If we examine the various aspects of the commodIty, that
is of the fully eVOlved commodity and not as it at first
slowly emerges in the spontaneous barter of two primitive
communities, it presents itself to us from two angles that
of use-value and exchange-value, and thus we come
158

immediately to the province of economic debate. Anyone

wishing to find a striking instance of the fact that the
German dialectical method at its present stage of
development is at leest es superior to the old s~per
ficially glib metaphYSical method as railways are to the
mediaeval means of transport, should look up Adam Smith
or any other authoritative economist of repute to see
how much distress exchange-value and use-value caused
these gentlemen, the difficulty they had in distinguishing
the two properly and in expressing the determinate form
peculiar to each, and then compare the clear, Simple
exposition given by Marx."
(Ibid, 226-7).
And he ends this review of the early perts of the Critigue in the
following way:
"After use-value and exchange-value have been expounded,
the commodity as a direct unity of the two is described
as it enters the eXChange process We marely note
that these contradictions are not only of interest for
theoretical, abstract reasons, but that they also reflect
the difficulties originating from the nature of direct
interchange, i.e. simple barter, and the impossibilities
inevitably confronting the first crude form of exchange.
The solution of these impossibilities is achieved by
investing a specific commodity - money - with the
attribute of representing the exchange-value of all other
commodities. Money or simple circulation is then analysed
in the second chapter, namely (1) money as measure of
value, and, at the same time, value measured in terms of
money i.e. price, is more closely defined; (2) money as
means of circulation and (3) the unity of these two
aspects, real money which represents bourgeois material
wealth as a whole. This concludes the first part, the
conversion of money into capital is left for the second
part." (Ibid, 227).
In order to underscore the significance of the early chapters of
Capital in the light of Engels' review of the earlier Critigua,
let us take a slight detour and look at the position of Althusser
on these early chapters.

According to this author, "we ought to

re-wdte Part I of Capital so that it becomes a "beginning" which

is no longer at all "difficult", but rather simple and easy. 3
for Althusser, in direct opposition to Lenin, Part I of Capital
159

is not the key to understanding the rest, it is a positive barrier

to that understanding.
of the following advice.

He therefore gives his readers the benefit

'I therefore give the following advice:

put THE WHOLE OF PART ONE ASIDE FOR THE TIME BEING AND BEGIN YOUR
READINLi WITH PART TWO, "The Transformation of Money into Capital'" 4
adding, 'This advice is more than advice: it is a recommendation
that notwithstanding all the respect lowe5 my readers, I am
prepared to present as an imperative (p BO).'

It should be clear

from what we said earlier that the real bete noire for Althusser is
Hegel.

He is specific on this point.

Many difficulties stand in

the way of understanding Capital which arise from the 'survivals in

Marx's language and even in his thought of the influence of Hegel's
thought,.6

As an instance of these supposed 'difficulties'

Althusser cites,
"the vocabulary Marx uses in Part I: in the fact that he
speaks of two completely different things (author's
italics) the social usefulness of products on the one hand
and the exchange vale of the same products an the other,
in terms which in fact have a ward 1n cammon, the ward
'value': on the one hand use-value, and on the other
exchange value. Marx pillories a man named Wagner (that
vir obscurus) with his customary vigour in the Msrginal
Nates of 1BB2, because Wagner seams to believe that since
Marx uses the same word, value, in both cases, use-value,
and exchange-value are the result of a (Hegelian) division
of the concept of 'value'. The fact is that Marx had not
taken the precaution of eliminating the word 'value' from
the expression 'use-value' and speaking ae he should have
dane somply of the social usefulness of the products".7
What are we to make of this passage?

Althusser mekes precisely the

same mistake as that ather 'vir obscurus' Wagner.

For Marx does

not derive the terms 'value' and 'use-value', from any 'division',
Hegelian or otherWise, of the concept of value.
these concepts from an analysis of the commodity.
160

He derivas bath
And this is

crucial.

tor as earlier indicated, it means that Marx never starts

from any concepts' (including therefore the value concept).

He

begins from the simplest forms of bourgeois wealth - the commodity.

He shows, as against Althusser, that in the commodity far from
being

'completely different things' use value and value are in-

separably united, are identical but identical as opposites.

Under

conditions of commodity production a product of labour can only

assume the value-form if it constitutes a definite use-value.

In

this respect use-value is primary to value in that while use-value

can exist independently of commodity production, the reverse is
certainly not the case.

In unfolding the secret of the commodity

form Marx was taking up a problem

since antiquity.
in two ways:

Aristotle had

~hich

~ritten

had exercised man's mind

that sandals could be used

in the first place they could be worn, and second,

they could be exchanged for another object.

If with Aristotle this

two-fold nature of the products of labour was still expressed in

necessarily primitive form, the economists of the eighteenth century
onwards were much more conscious of this division (see the contrast
political economy drew

bet~een

'values' and 'riches'), even though

they railed fully to understand it.

And as Engels makes clear,

Marx's ability to provide a clear analysis of the commodity form

arose precisely from his indebtedness to Germen dialectics and
principally to Hegel.
We shall return in a moment to Marx's investigation of the commodity.
But let us

d~ell ~ith

Althusser a little longer.

He

~ants

to leave

aside Chapters 1 - 3 (that is presumably until he has got round to

redndering them into simple, non-dialectical language for us).
161

What

implications does this 'leaving aside' have?

It means, for Althusser,

that we can plunge immediately into Part II, 'The Transformation of

Money into Capital'.

This presents no problem at least for workers,

as they will readily understand this section of Marx's work:

"from Part 2 you go straight into the heart of
Volume One This heart is the theory of surplus-value,
which proletarians will understand without any difficulty,
because it is simply the scientific theory of something
they experience every day in class exploitation." a
And this is not an isolated point.

for earlier in his 'Preface' to

to Capital, Althusser writes, 'If the workers have 'understood'

Capital so easily it is becausa it speaks in scientific terms of the
everyday reality with which they are concerned:

the exploitation

which they suffer because of the capitalist systeml H9

A point

emphasised by Althusser, whan immediately following we find 'Capital

is a straightforward discussion of their concrete lives,.10
To take AlthuBser's specific paint:

is the essence of Capital a

straightforward discussion of the "concrete lives" of the working

class'?

It most emphatically is not.

Marx's aim was not to show

workers that they were exploited, 'something they experience every

day'.

He aimed for something quite different.

The working class

did not need to be told by Marx, or indeed by anybody else, that

they were

expl~t8d-

of Marxism.

this they had recognised long before the birth

It was a recognition which found a reflection, as

alwsys, in practice, in this case the practice of trade unionism.

Marx wanted to establish the revolutionary implications or this
struggle of the working class.

And this revolutionary consciousness

does not arisa directly from the immediate day-to-day struggla of

162

the working class - it involves grasping the class struggle as a

whole, on the basis not merely of everyday class exploitation,
but on a real understanding of the relationship of all classes to
each other and to the state.
is to be Done?

This is the theme of Lenin's

(LOW, vol. 5) against all conceptions of a

spontaneous struggle which would automatically generate a scientific

consciousness in the working class.
they are exploited;

The majority of workers 'know'

what the working class does

spontaneously

have is an understanding of the socia-historical roots of this

exploitation, nor

of all the theoretical and political tasks which

are posed in its elimination.

Now this matter has a direct bearing on the status of the early
chapters (Chapters 1 - 3).

For it is in these chapters that the

logical-historical path whereby capital comes into being is traced.

Speaking of the relationship of capitel to surplus value, Marx says,
"It is quite simple.

If with 100, i.e. the labour of

10 (men), one buys the labour of 20 (men) (that is,
commodities in which the labour of 20 (men) is
embodied), the value of the product will be 200 and
the surplus-value will amount to 100, equal to the
unpaid labour of 10 (men). Or supposing 20 men worked
half a day each for themselves and half for capital 20 half-days equal 10 whole ones - the result would be
the same as if only 10 men were paid and the others
worked for the capitalist gratis." (Th 3, 481).

'It is quite simple'.

But Marx immediately adds a point which

implicitly refutes Althusser and establishes that it would be quite

false to start from the transformation of money into capital without
having grasped first of the nature of commodity exchange.
"The difficulty is simply to discover how this appropriation
of labour without any equivalent arises from the law of
163

commodity exchange - out of the fact that commodities

exchange for one another in proportion to the amount
of labour-time embodied in them - and to start with
does not contradict this law." (Th 3, 481-2).
And it was here that Marx made a development on classical political
economy which was to transform completely the science - and this
development in this case consisted in tracing the connection between
the law of value and the law of surplus value, a connection which
utterly eluded Ricardo and company.
Now of course Althusser pays formal acknowledgement to the revolutionary struggle of the working class.
acknowledgement.

But it is purely formal

for in his conception the struggles are

mechanically, metaphysically separated from the defensive struggle

on wages and economic conditions.

This is how Althusser poses this

relationship:
"The economic (trade union) class struggle remains a
defensive one because it is economic (against the two
great tendencies of capitalism). The politicel class
struggle is offensive because it is political (!2t the
seizure of power by the working class and its allies).
These two struggles must be carefully distinguished
from one another; althougn they always encroach upon
11
one another; more or less according to the conjuncture."
Here Althuser's

~onjuncture'

is introduced as a pure deus ex machina

to escape from a theoretical impasse.

for the problem is

defensive struggle transformed into the offensive.

is the

In the Manifesto,

Marx shows how the very historical development of capital itself

creates the material conditions for the continual growth of the class
struggle from defensive concerns (wage regulation, etc.) to offensive
concarns (the high point of which is the seizure of power by the
working class).

Capital, from this point of view, is an elaboration

164

and working out in detail of Marx's conceptions, first sketched out

in 1848.

The point here is this:

it is not that the working class

is engaged in a defensive struggle which at some unexplained conjunctura moment 'encroaches' upon an offensive struggle.

As

Althusser presents it here the working class is an inert mass,

whose consciousness is raised by entirely outside forces ('theory').12
This is, however, far from the case.

While denying that the working

class can spontaneously reach a revolutionary consciousness (such a

conception is elaborated in the theory of 'spontaneity') Marxism at
the same time recognises that the working class is driven, by the
very nature of its struggle in the direction of socielist consciousness.

Thus in his attack on the economists, Lenin, while denying

that socialist consciousness appears as a direct result of the

proletarian class struggle, did agree with Kautsky that socialism
and the class struggle

arise side-by-side.

In a footnote in

is to be Done? Lenin poses the relationship between the working

class and a Marxist consciousness which avoids the mistakes of
8pontaneity but at the same time sees the living connection between
Marxism and the working class.

'It is often said', remarks Lenin,

'that the working class spontaneously gravitates towards Socialism'.

"This is perfectly true in the sense that socialist theory
defines the causes of the misery of the working class
more profoundly and more correctly than any other theory,
and for that reason the workers are able to assimilate it
so easily, provided, however, that this theory does not
itself yield to spontaneity, provided it subordinates
spontaneity to itself. Usually this is taken for granted,
but it is preCisely this which Rabocheye Oyelo (Workers'
Cause, a magazine published by the Economists, 1899-1902)
forgets or distorts. The working class spontaneously
gravitates towards Socialism, but the more widespread (and
continuously revived in the most diverse forms) bourgeois
ideology nevertheless ~ntaneously imposes itself upon the
165

working class still more."

(L.CW, 5).

Engels' treatment of Marx's method and Althusser's attitude to the

early section of Capital once more serve to draw attention to the
dialectical character of Capital as a whole.

In considering the

nature of Marx's starting point and his dialectical treatment of

the commodity, let us recall Lenin's characterisation of the most
general features of dialectics.

Lenin writes:

'The splitting of

a single whole and the cognition of its contradictory parts is

the essence of dialectics'.

(LOW, 38, 359).

Now this question of

the 'single whole' must be especially kept in mind when considering the point from which Capital begins.

If Marx's aim was to

present the capitalist system in the whole sweep of its development, then the commodity had also to be understood in its whole
development.

The commodity was shown by Marx to be a unity of value

and use value.

in view.

And it was necessary that

for a knowledge of

these 'sides' be kept

these opposites, in their conflict,

is necessary if thought is to get near to the real movement of

commodity production.

Lenin puts this point in the following way

'The condition for the knowledge of all processes of the world in

their "self movement", in their spontaneous development, in their
real life, is tha knowledge of them as a unity of opposites.
ment is the "struggle" of opposites.'

(LCW, 38, 360).

Develop-

As we have

seen, for Marx, in the investigation of economic terms abstraction

was essential.
one.

But this process of abstraction is a contradictory

for abstraction to a certain extent kills the living movement

of reality.

The problem for thought, therefore, is really this:

166

how to depict movement through concepts.

The ancient Greek ration-

alist Zeno regarded movement as 'sensed truth'.

rest on a mere admission of fact.

But he did not

He was among the first in the

history of philosophy to show the contradictory aepects of movement - the contradiction between 'discreteness' and 'continuity' of
'rest' and 'motion'.

He was among the first of those who attempted

to understand the connection between these eepects;

but he was

unable to comprehend this contradiction in terms of fixed concepts,

and therefore, as a rationalist, came to a denial of the reality of
movement.

But the question is not whether there is such a thing

as movement;

that is acknowledged as a fact of experience and

verified in the history of science - the problem for thought is

thus how to grasp movement through concepts which inevitably tend
to coarsen and strangle reality.

As Lenin shows this ie not a

'problem' for thought, so much as an expression of the contradictory nature of all reality, a contradiction which finds its
essential expression in dialectics.

Thus

"We cannot imagine, express, measure, depict movement,

without interrupting continuity, without simplifying,
coarsening, dismembering, strangling that which is
living. The representation of movement by means of
thought always makes coarse, kills - and not only by
means of thought, but also by sense-perception, and
not only of movement, but every concept. And in that
11ea the essence of dialectics.
And precisely this
essence is expressed in the formula: the unity, ---identity of opposites."
(Lew, JB, 259-60).
And elsewhere in this work Lenin makes this same point when he says
that Hegel showed that

~n

abstract concepts (and in the system of

them) the principle of motion cannot be expressed otherwise than

as the principle of the identity of opposites'.

167

(Ibid, 345).

The

~ay

Marx develops his investigation of the commodity testifies

both to the truth of Lenin's propositions and the essential

sterility of Althusser's position.

for Marx does in fact 'hold

fast' to both sides of the commodity.

He reveals throughout the

whole of Capital how the contradiction of the commodity form unfolds, intensifies and dominates every aspect of bourgeois society.
The contradictions of the commodity are never left behind;

nor

are they merely 'returned to' at various paints throughout the

three volumes.

This basic contradiction (use-value, value) con-

tinually reappears in newer and higher forms which grow out of the
lower forms as part of an uninterrupted process.

It is through

the development of these forms that development in the sphere of

economy takes place.
Let us examine the question more specifically, from the point of
view of the place occupied by usa-value in Marx's analysis.

One

considereble debt we owe to Rosdolsky lies in the fact that he has

done much to clear up the confusion surrounding this matter in most
popularisations of Capital.

Summing up his discussion and making

what is the decisive paint he says, 'Engels was surely right when
he perceived in Marx's treatment of use-value, and its role in
political economy, a classic ~xample of the use of the "German
dialectical method".

13

Among Marx's many criticisms of Ricardo's work was the fact that he
had tended to ignore the place of use-value in his economics.
Ricardo, says Marx, it 'remains lying dead, as a Simple presupposition'.

(G, 320).

He

~as,

168

adds Marx, only 'esoterically

for

concerned' with this category.

(G, 647).

Now, as Rosdolsky makes

clear, the importance of these comments had certainly escaped many

writers on Capital.

Sweezy's case is typical and important if only

because his Theory of Capitalist Development has long been

recognised as perhaps the standaro popularisation of Marx's
political economy.
quite wrong.

Sweezy clearly gets the matter of use-value

And one source of his error is undoubtedly the con-

fusion of 'use value' with the concept of 'utility' found in

orthodox economics.

Sweezy writes, 'Marx excluded use-value (or

as it would now be called "utility") from the field of investigation of political economy on the ground that it does not directly
embody a social relation'.

14

And pointing out that bourgeois and

Marxian value theories are 'diametrically opposed', Sweezy adds,

'Nor should it be made a matter of reproach against Marx that he
failed to develop a subjective value theory, since he consciously
and deliberately dissociated himself from any attempt to do so.' 15
Now 'utility' is a subjective,a-social category concerned with
the relationship between an individual's supposed mental state and
material objects.

Marx, of course, entirely rejects this starting

point as heving anything to do with science.

deduce aocial laws from states of mind.

for it pretends to

It would have been

impossible to develop a value theory from such a standpOint.

The

theory of marginal utility was not a rival value theory, for value
is, as a social relation of a specific kind, precisely what is
excluded by the upholders of marginal utility theory.

But when we

come to consider use-value we are dealing with an entirely different

matter.

Use-value is the substance of all wealth, with an entirely

objective existence.

Use-values are produced under all social

169

conditions.

Thus far from being uninterested in this category,

Marx is vitally concerned with it in so far as it is itself a

'determined economic form'.

This is what he says on the subject:

"To be a use-value is evidently a necessary pre-requisite

of the commodity, but it is immaterial to the use-value
whether it is a commodity. Use-value as such, since it
is independent of the determinate economic forms, is outside the sphere of investigation of political economy.
It belo s to this shere onl when it is a determinate

.!2.!!!!..

1,

2B

The key point here is that Marx is not interested in use-value

is interested solely in it in connection with the analysis

-ofsuch.givenHe economic
forms. His answer to Wagner clears up the matter
at issue:
"Only an obscurantist who has understood not a word of
Capital can conclude: Because Marx repudiates all
Germanic professional noneense about 'use-value' in
general (author.' s italics) in a note to the firstedition of Capital, and refers readers who wish to
know something about actual use-values to 'Introduction
to Commodity Theory' - for that reason, use-value plays
no role in his work. Naturally, it does not play the
role of its contrary, 'value', which has nothing in
common with it apart from the fact that 'value' occurs
in the term 'use-velue'. He could just as well have
said that 'exchange-value' is ignored in my work because
it is only appearance-form of value, but it is not
'value', since for me the 'value' of a commodity is
neither its use-value not its exchange-value.,,16
And Marx goes on:
"If one has to talk of analysing the 'Commodity' - the
simplest economic concretum - then one must keep all
relationships distant which have nothing to do with the
proposed object of analysis. What is to be said of the
commodity in so far as it is a use-value, I have said
in a few lines, therefore, but on the other hand have
emphasised the characteristic form in which the use-value
(the labour product) appears at this paint, namely (here
Marx quotes from the first volume of Capital) 'A thing
can be useful and a product of human labour without being
170

a commodity. Whoever satisfies his own need by his

product creates a use-value, admittedly, but not a
commodity. In order to produce a commodity, he not
onl has to roduce a use-value but a use-value for
others, social use-value' Thereby use-value as
use-value of the 'commodity' itself) possesses a
history-specific character Thus it would be pure
babbling (as emerges from the preceding) in the
analysis of the commodity - since it manifests itself
on the one hand as use-value or goad and on the other
hand as 'value' - to 'tie on' upon this occasion all
sorts of banal reflections concerning use-values or
17
goods which do not fall within the realm of commodities."
Immediately fallowing this passage Marx says that Wagner failed to
see that in Capital 'use-value plays a very important role different from in previous Economics, but that it precisely only carnes
from the analysis of a given economic structuring, nat from
intellectualizing hither and yon about the concepts or words ttuse_
value" and "value'tf. 18

Karl Korsch got this question right, even

though one would wish to dissent strongly from him on many others.
He writes:
"With Marx use-value is not defined as a use-value
in general, but as the use-value of a commodity. This
use-value inherent in the commodities produced In
modern capitalist society is however, not merely en
extra-economic presupposition of this 'value'. It is
an element of the value, and itself ie an economic
category. The mere fact that a thing has utility for
any human being, say for its prodUCer, does not yet
give us the economic definition of use-value. Not
until the thing hae social utility (i.e. utility tfor
other persons') does the thing has social utility (i.e.
utility 'for other persons') doee the economic definition
of use-value apply."19
(In his last sentence Korsch is not strictly correct;

as Engels

points out in a parenthesis (I, 41) in Capital, commodities do

not involve only the production of 'social use-values';

this use-

value 'must be transferred to another, wham it will serve as a

171

use-value, by means of an exchange'.)

Thus, far from being excommunicated from the investigation of
capitalism, use-value plays a central role.

We can see this in

connection with surplus value itself which, as Marx shows, arises

from the use-values of the commodity labour-power.

But let us

give a series of examples to indicate the role played by use

value.
1

Marx gives one clear example in connection with the deter-

mination of the rate of profit, to the extent thet the rate of

profit depends on fluctuations in the value of raw materials.

tor,

as Marx puts it,

nit is especially agricultural produce proper, i.e. the
raw materials taken from nature, which is subject
to fluctUations of value in consequence of changing
yields etc. Owing to uncontrollable natural conditions,
favourable or unfavourable seasons, etc., the same
quantity of these use-values may therefore have different prices".
(III, 117-18).
Such variations must always affect the rate of profit 'even if they
leave the wage untouched and hence the rate and amount of surplus
value too'.
2

(III, 115).

As a second instance the role of use-value in the investigation

of economiC forms we can take the case of the Reproduction Schema

given in the second volume of Capital.
capital turnover was a two-sided one.

tor Marx the problem of

In the first place, in order

that reproduction may be achieved, the total value embodied in the

commodities produced must be realised, that is sold at prices
equivalent to their value.

But at the same time, we are not dealing

with a purely value-creating and realising process.

172

tor at the same

time reproduction always requires, if it is to be crisis-free,

that the usa-value of the commodities produced should fulfil
definite material conditions for the recommencement of production.
If, in an extreme case, all commodities produced were raw
materials, workers and capitalists alike would starve (assuming
no reserves of food were available).

Or if all commodities

produced were consumer goods there would be no resources to make

good wear and tear of machinery and the economy would eventually
grind to a halt.

So the use-value composition of the outputs of

Departments I and II is clearly a crucial factor in an analysis

of the conditions of potential equilibrium and breakdown alike.
3

As a final example of the importance of a proper considera-

tion of the use-value side of commodity production let us take the

example ot money.

Even with simple commodity circulation, with

the emergence of the money-form of the commodity, the value of a

commodity must be represented in the farm of use-value, that is in
the natural form of the commodity.

This means that not only must

money itself be a commodity, but also that this use-value must be

connected to quite specific material properties of this moneycommodity.

As Marx puts this paint,

"In proportion as exchange bursts its local bands, and

the value of commodities more and more expands into an
embodiment of human labour in the abstract, in the same
proportion the character of money attracts itself to
commodities that are by Nature fitted to perform the
social function of a universsl equivalent. These
commodities are the precious metals." (I, 89; author's
italics).
And Marx immediately adds 'although gold and silver are not by

173

Nature money, money is by Nature gold and silver'

(I, 89;

author's

italics).
The first three sections of the opening chapter of Capital are
concerned with the formation of money.

for Marx, the problem was

not to show that money was itself a commodity (in the case of gold
this was obvious) but to demonstrate the transition from the most
simple, elementary relation of the commodity to money.

'The

difficulty', as Marx puts it, 'lies not in comprehending that money

is a commodity, but in discovering how, why and by
commodity becomes money'.

(I, 92).

~hat

means a

It is necessary to stress once

once more that Marx is not engaged in some mere manipulation of cancepts, 'applying' a few Hegelian concepts and phrases.
against precisely this

vie~

Marx warns

when he tells us:

"It will be necessary later, before the question is

dropped, to correct the idealist mannar of its
prasentation, which makes it seem as if it ware marely
a matter of conceptual determination and of the
dialectic of these concepts. Above all in the case of
the phrasa: product (or activity) becomea commodity;
commodity exchange value; exchange-value, monay." (G, 151).
Hare Marx is making a point he made over and over again;
economic categories reflect real human practica.

namely that

Engels' insistance

on the unity of the 'logical' and tha 'historical' can be seen in

practice in Capital (as well as in the Grundr!sse)

~here

the logical

derivation of the concepts 'valua' and 'money' is paralleled with a

historical derivation of thesa same categories.

Marx always can-

fronts the results of his abstract analysis with actual historical

developments.

The exchange of commodities arises from a long process

of economic development and presupposas a certain level of the

174

productivity of labour.

The decisive point for the development of

commodity production arises when communities are able to produce

more than they require for their immediate subsistence, that is as
soon as this labour can regularly generate

'surplus product'.

Now the exchange of products, says Marx, tends not to take place
within communities, but between them.

This primitive barter is

still, however, a long way (both logically and historically) from

developed exchange.

for this, developed exchange, exchange value

has to acquire an independent form.

ways.

This fact is revealed in two

The production of use-value remains the purpose of society.

Use-values cease to be merely use-values and become means of

exchange or commodities, only after a larger amount of them has
been produced than is needed for consumption.

But even when this

occurs, this surplus takes the form of commodities only within the
limits set by the nature of these use-values.

Thus 'the commodi-

ties to be exchanged by their owners must be of use-values for

both of them, but each commodity must be a use-value for its nonowner'.

(Critique,50).

It is only when a portion of the products

of labour are produced with a special view to exchange that,

"the distinction becomes firmly established between the
utility of an object, for the purposes of exchange.
Its use-value becomes distinguished from its exchangevalue. On the other hand, the quantitative proportions
in which the articles are exchangeable, becomes
dependent on their production itself. Custom stamps
them as values with definite magnitudes lt (I, 88).
So the appearance of the value-form is a reflection of the growth
of the productive forces:

'The necessity for a value-form grows

with the increasing nature and variety of the commodities exchanged.

175

The problem and the means of solution arise simultaneously.'

(author's italics).

(I, 88)

Commercial exchange in which commodity-owners

exchange and compare articles, never takes place unless the different kinds of commodities belonging to different owners are exchanged
for, and equated at values with, one single further kind of commodity.
And this commodity thereby acquires, albeit at first within narrow
limits, the form of a universal social equivalent.
yet any real stability.

But it lacks as

It appears and disappears with the momentary,

often accidental contacts (between communities) which call it into

being.

It is attached first to this, then to that commodity.

It is

only with the davelopment and growth of ax change that it fixes itself
to particular types of commodities - that is, it is crystallized out
into the money form.
To start with, Marx indicates that a commodity will serve as money
which represents in a given community the predominant form of wealth that is to say the commodity most frequently exchanged and circulated
as an object of consumption.

At this stage, the commodity 'selected'

is determined by the particular usefulness of the commodity as an

object of consumption (salt, hides, etc.) or of production (slaves).
In the case of a higher development this situation is transformed
into its exact opposite, now it is the commodity which has the least
utility as an object of consumption or production that beet serves
the needs of exchange as such.

In the first case, the commodity

becomes money merely because of its particular use-value, in the

latter case it acquires use-value precisely because of its serviceability as money.

This makes the precious metals especially suitable -

they are easily divisible and- combinable, they are readily transport176

able owing to the compression of considerable value in a little

space.
Having stressed the historical-practical nature of the process which
brings the money-form into being, let us now consider how Marx
traces this appearance in logic.

We know already that the products

of labour only constitute values in so far es they embody the same

social substance, general human labour.

But we know also that it is

the labour of individuals, expressing different degrees of intensity,

skill, etc., in short definite concrete labour 'which assimilates
particular natural materials to particular human requirements'. (I,
42).

As such this labour is alweys objectified 'in a definite

particular commodity, with particular characteristics, and particular

relations to need', but as human labour in general it needs to be
embodied 'in a commodity which expresses no more than its quota or
quantity, which is indifferent to its own natural properties, and
which can therefore be metamorphosised into - i.e. exchanged for
every other commodity which objectifies the same labour-time'.
(G, 168).

This means that 'The commodity, as it comes into being,

is only objectified individual labour-time of a specific kind, and

not universal labour-time.

The commodity is thus

immediately

exchange-value but has still to become exchange-value'.

p.43).

(Critique,

It is of course important to keep in mind the fact that

this contradiction between individual and universal labour is a

reflection of the contradictory nature of the commodity itself,
that is of objectified labour.

Thus, 'Two commodities, e.g. a yard

of cotton and a measure of oil are different by nature, have different properties, are measured by different measures, are incommensur177

able.'

(G, 141).

While,

"Considered as values, all commodities are qualitatively

equal and differ only quantitatively, hence can be
measured against each other and substituted for one
another in certain qualitative relations. Value is
their social relation, their economic quality As
value a commodity is an equivalent for all other
commodities: as an equivalent, all its natural properties
are extinguished; it no longer takes up a special,
qualitative relationship towards the other commodities:
but is rather the general measure as well as the general
representative, the general medium of exchange of all
other commodities. As value, it is money." (G, 141).
And it is for this reason that value must take on an existence
independent of the bodily existence of the commodity.

Marx explains

that vital point in the following way;

"The property of being a value not only has but must
achieve an existence different from its natural-one.
Why? Because commodities as values are different from
one another only quantitatively; therefore each
commodity must be qualitatively different from its own
value. Its velue must therefore have an existence
which is qualitatively distinguishable from it, and in
actual exchange this separability must become a real
separation, because the natural distinctness of
commodities must come into contradiction with their
economiC equivalence, and because both can exist
together only if the commodity achieves a double
existence, in which it is a mere symbol, a Cipher for a
relation of production, a mere symbol for its own value."
(G, 141; author's italics).
We can now examine Marx's analysis of the movement from direct barter;
the succession of the stages of exchange - the 'simple', the 'total'
and the 'general' value-forms.

As Marx notes:

"Everyone knows, if he knows nothing else, that commodities

have a value-form common to them all, and presenting a
marked contrast with their varied bodily forms of their usevalue. I mean their money-form. Here, however, a task is
set us, the performance of which has never yet even been
attempted by bourgeOis economy, the task of tracing the
genesis of this money-form, of developing the expression of
value implied in the value-relationship of commodities, from
178

its simplest almost imperceptible outline to the dazzling

money-form. By doing this, we shall, at the same time,
solve the riddle presented by money." (I, 47-8).
We should note, in passing, that despite the fact that Marx here
tells us that in tracing the genesis of the money-form he was
attempting something never properly considered by bourgeois economy,
very few writers on Caeital have paid the slightest ettention to the
sections in Capital dealing with the value-form and its growth.

The

late Ronald Meek in his Studies in the Labour Theory of Value

dismissed the analysis of the value-form in one short paragraph.
'There is no need', he writes,
"for us to follow Marx's rather complex analysis of the
'elementary', 'expanded' and 'money' forms of value in
any detail. Essentially, what he is trying to do here
is to reveal the contradictions which result from the
reciprocal interaction of the two sides of the value
equation, and to demonstrate the nature of the solutions
of these contradicti~8s which logic - and history demand and provide".
In our opinion this is quite inadequate, Marx's analysis on this
question cannot be dismissed on the grounds that it is 'rather
complex'.

for, as we will endeavour to show, the proper apprecia-

tion of the elementary value-form, that is the exchange of two

commodities (20 yards of linen 1 coat), not only provides the key
to understanding the nature of money (which claSSical economy, let
alone modern economic theory, failed to understand), but also the
key to Marx's notion of fetishism, which Rubin (1972) in particular
has so correctly insisted is one of the foundations of Marx's
entire analysis of capitalism.
Let us follow Marx's argument.

from the beginning he indicates that

179

in the elementary or accidental value-form (x commodity A Y

commodity 8) is expressed in 'external' form the 'internal'
contradiction within the commodity itself.

In the first edition

of Caoital we find the following crucial passage.

"The inner opposition contained in the commodity of usevalue and ~alue is thus manifested by an external
opposition; that is the relationship of two commodities
of which the one counts immediately only as usa-value,
the other immediately as exchange-value, or in which both
of the opposite determinants as use-value and exchangevalue are apportioned among the commodities in a polar
manner."21
And a similar passage is' found in the third edition where we read:
opposition or contrast existing internally in each
commodity between use-value and value, is therefore, made
evident externally by two commodities, being placed in
such relation to each other, that the commodity ~hose
value it is sought to express, figures directly as a mere
use-value, while the commodity 1n which that value is to
be expressed, figures directly as a mere exchange-value.
Hence the elementary form of value of a commodity is the
elementary form in which the contrast contained in that
commodity between usa-value and value, becomes apparent ...
(I, 61; author's emphasis).

'~he

These passages are crucial and worth considering carefully for the
following reason:
manner.

Marx is here presenting value in truly dialectical

for value is an inner relation of the commodity to itself,

reversed in outward form through the relation to another commodity.

This other commodity (here the coat) plays the passive role of the
mirror in which the inwardly contradictory nature of the commodity
that expressed its value (the linen) plays the active role.

Here. is

expressed the fact that dialectics obliges one always to discover,

behind the outward form of a thing's relation to another thing, its
own inner nature, its own being.

180

(We should note that the properties

of a thing - say the linen - are not the result of its relation to
other things - the coat - but only manifest themselves in such
relations.)

Of course dialectics does not reduce the external con-

tradictions (between two commodities in the elementary form of

exchange) to the internal contradiction of the commodity.

The question

was not one of reduction, but of deriving the former from the latter
and thus comprehending both in their objective necessity.

Exchange-

value has to be derived from the contradiction between value and usevalue within the cell of bourgeois society.
True to the dialectical conception of the whole work, Marx tells us
that this elementary form is the key to understanding the mystery
of the entire value-form, just as the contradictory nature of the
commodity is the 'germ' of all the more developed contradictions.
Thus, 'The whole mystery of the form of value lies hidden in this
elementary form.

Its analysis, therefore, is our real difficulty.'

It is, putting the matter more concretely, the contradictions of this

elementary form which provide the essential key to all the higher,
more general contradictions:

'We perceive, at first sight, the

deficiencies of the elementary form of value;

it is a mere germ which

must undergo a series of metamorphoses before it can ripen into the

price-form.'

(I, 62;

author's italiCS).

Thus Marx says, 'The

antagonism between the relative form of value and the equivalent

form, the two poles of the value-form is developed concurrently with
the form itself.' (1, pp. 67-8).

Now it is precisely because the

equation 20 yards of linen 1 coat 1s the 'germ' of all the contradictions of capital that we must investigate it thoroughly.
spoke specifically of this point in Capital when he wrote:
181

Lenin

"Just as the simplest form of value, the individuel act

of exchange of one given commodity for enother, already
includes in an underdeveloped form all the main contradictions of capitalism - so the simpr;st generalisation,
the first and simplest formation of notions (judgements,
syllogisms, etc.) already denotes man's ever deeper
cognition of the objective connection of the world. Here
is where one should look for the true meaning, significance and role of Hegel's Logic.'t This NB. (LeW 38, 178).
In other words, as Lenin pOints out elsewhere in the Philosophical
Notebooks, even in the simplest copular judgment ('fido is a dog')
is found the germ of dialectics (the relation between the individual
and the universal, between chance and neceSSity, the identity of
opposites, etc.) so in the elementary value-expression is found the
as yet hardly perciptible germ of the entire movement of capital.
Now in this elementary value form (for simplicity's sake we will
throughout use Marx's example, 20 yards of linen 1 coat) the
linen plays the active role, the coat the passive.

The qualitative-

quantitative contradiction of the commodity linen is 'resolved' in

the relationship of this commodity linen to its equivalent-form,
the coat.

But it is not resolved in the sense that the initial

contradiction disappears - it is heightened into an even sharper

antagonism.

Thus, 'The relative form and the equivalent form are two

intimately connected, mutually dependent and inseparable elements of

the expression of value;

but at the same time are mutually exclu-

sive, antagonistic extremes, i.e. poles of an expression.'

(I, p 48).

(We can note in passing that this antagonistic nature of the

elementary value-form comes across even more strikingly in German
by the fact that linen is a feminine word and coat a masculine.)
At the outset Marx leaves aside an investigation of the purely quanti182

tative side of this relationship.

Here alone is revealed one

important aspect of Marx's difference with the political economists

whose attention, as we have seen, was directed almost wholly to
this quantitative side.

Marx says, on this point,

"It is the expression of equivalence between different sorts

of commodities that alone brings into relief the specific
character of the value-creating labour, and this it does by
actually reducing the different varieties of labour embodied
in the different kinds of commodities to their common
quality of human labour in the abstract." (I, 49).
Two pOints should be noted in connection with this and many similar
passages.

first, one already made and therefore a question that

need not detain us, namely the objective character of this reduction
of concrete to abstract labour.

Second, the fact that the two-fold

character of labour embodied in the commodity is only made manifast,

only 'brought into relief' in the elementary value-form, in the
simple relation between two commodities.

Just as the two-fold

character of the commodity is only made visible through its relations

with another commodity, the same is equally true for the two-rold
nature of the labour which produces the commOdity.
But, notes Marx, it is not adequate merely to grasp the valuecreating nature of labour (that is, abstract labour);

it is

necessary to see that the reduction of concrete labour to abstract

labour is not and cannot be a direct one.

It is, by its very nature,

a mediated process, one in which the abstract labour congealed in the

commodity is congealed in the form of some object and only in this
indirect way can it become 'value'.

In a passage which shows the

not immodest distance separating Marx from all those who read him

183

as a 'consistent empiricist' we find:

"There is however something else required beyond the
expression of the specific character of the labour of
which the value of the linen consists. Human labourpower in motion, or human labour, creates value, but
is not itself value. It becomes value only in its congealed
state, when embobied in the form of some object. In order
to express the value of the linen as a congelation of human
labour, that value must be expressed as having objective
existence, as being something materially different from the
linen itself, and yet a something common to the linen and
all other commodities. The problem is already solved."
(I, 51).

Marx is here streSSing the fundamental fact that in a society of

atomized private producers the labour of the individual is not
directly social, nor can it ever be.

The labour of the individual

becomes social only through the negation of its own original

character, by appearing in

a directly

opposed form.

Despite the

increasingly socialised nature of production under the capitalist

system, there is no unified, conscious, mechanism of social planning.
The only 'planning' takes place through the blind force of the
market.

'The total movement of this order is its disorder.'

Hence,

Marx, in summing up his discussion of the relative form, says, 'The

value of the commodity linen is expressed by the bodily form of the
commodity coat;

the value of one by the use-value of the other

Thus the linen acquires a value-form different from its phYSical

form.'

(I, 52).

Speaking of the linen, Marx says, 'In order to

inform us that its sublime reality as value is not the same as its
buckram body, it says that value has the appearance of a coat, and
consequently that so far as the linen is value, it and the coat are
as like as two peas.'

(I, 52).

Marx then turns to the peculiarities

184

of the equivalent form (the coat).

It is through an examination

of these 'peculiarities' that he shows how the contradictions in

the elementary form of value are in fact overcome - overcome by
being taken into a higher unity in the money form.

tor the

peculiarities of the form 20 yards of linen 1 coat highlight with

even more force the indirect, unconscious nature of the procesa of
production under capitalism, a process which therefore demands, and
finds, some universal value-form (money) in which this indirectness
is turned into its opposite.
1

The three peculiarities are:

'Use-value becomes the form of its manifestation, the

phenomenal form of its opposite, value.'

2

The fact 'that concrete labour becomes the form under which

its opposite direct human labour manifests itself.'

3

The fact 'that the labour of private individuals takes the

form of its opposite, labour directly social in its form'.

(I, 55-8).

Here are brought out by Marx (brought out after the detailed
investigation of the elementary form which has so often been
neglected in commentaries on Capital)

all the major contradictions

of capital - although naturally only in embryonic form.

In

particular we should note the fact that the two-fold character of

labour which is first revealed in the elementary value-form
(remembering the importance of the concrete-abstract labour
distinction in Marx's work):
"The body of the commodity that serves as the eqUivalent,
figures as the mater~isation of human labour in the
abstract, and is at the same time the product of some
specifically concrete labour. This concrete labour
becomes therefore the medium for expressing abstract
human labour."
(I, 58).
185

And further
"If on the one hand the coat rates as nothing but the
embodiment of abstract human labour, so, on the other
hand, the tailoring which is actually embodied in it,
counts es nothing but the form under which that abstract
labour is realised. In the expression of the value of
the linen, the utility of the tailoring consists, not in
making clothes but in making an object, which we at once
recognise to be of value, and therefore to be a congelation of labour, but of labour indistinguishable from that
revealed in the value of the linen. In order to act as
such a mirror of value, the labour of tailoring must
reflect nothing besides its own abstract quality of being
human labour generally." (I, 58).
Precisely because of the unresolved contradictions of the elementary
value-form, it must develop into newer higher forms in which these
contradictions are never lost, but always sublated.

Out of the

internal contradictions of the form 20 yards of linen 1 coat grows

the expanded value-form, nemely 20 yards of linen 1 coat, 2 sheep,

ton of iron, etc.

This form comes into ectual existence for the

first time as soon as a particular product of labour, such as cattle,

is no longer exceptionally, but habitually, exchanged for various
other commodities.

(I, 66).

'particular' in Hegel's logic:

(This stage corresponds to the

a series of particular commodities

play the role of eqUivalent alongside eech other.)

Having looked at Marx's treatment of the elementary form in some
detail, this expanded form need not detain us over-long.

However,

we need to draw attention to the fact that the relations which were
in the elementary form (the individual) relatively imperceptible
noW manifest themselves with greater force and clarity in this
higher form.
"It is thus that for the first time that value shows itself
in its true light, as a congelation of undifferentiated
186

human labour. for the labour that creates it, now stands
expressly revealed as labour that ranks equally with every
other sort of human labour, no matter what its form,
whether tailoring, ploughing, mining, etc." (I, 63,
author's italics).
Expressed in the expanded form is an expansion of the actual social
relations of commodity production.

for the linen, by virtue of its

form of value, no longer stands in a social relation with merely

one kind of commodity, but 'with the whole world of commodities' and
becomes a true citizen of the world of commodities.

(I,

63).

The

semblance of the relations of the elementary form now takes on apparent

form in another sense.

(We should note that Marx here deals quite

consciously with this movement from 'semblance' to 'appearance', an

appearance in which it becomes possible to identify clearly the
opposites in the phenomena under investigation.)

for what seemed

previously mere chance is now ravealed to be necessity in this expanded

form.
"In the first form it might for ought that otherwise
appears, be pure accident, that the two commodities are
exchangeable in definite quantities. In the second form
on the contrary, we perceive at once the background that
determines and is essentially different from this accidental appearance. The value of the linen remains
unaltered in magnitude, whether expressed in coats, coffee,
or iron, or in numberless different commodities, the
property of as many different owners. The accidental
relation between two individual commodities disappears."
(I, 63).
further, says Marx, 'It becomes plain that it is not the exchange of
commodities which regulates the magnitude of their value;

but on

the contrary, that it is the magnitude of their value which controls

their exchange proportions', a point which, incidentally, makes
clear Marx's conception of the relationship of 'production' to

187

to 'exchange'.

And just as in the case of the elementary form so

now in the case of the expanded, Marx goes on to reveal the

deficiencies of this total form.
"In the first place, the relative expression of value is
incomplete because the series representing it is interminable. The chain of which each equation of value is a
link, is liable at any moment to be lengthened by each
new kind of commodity that comes into existence and
furnishes new material for a fresh expression of value."

(I, 64).
This form, precisely because it is always by its nature incomplete
and 'deficient in unity' (I,

64) gives way to a higher form, the

General Form of Value, expressed as follows

1 coat
10 lbs of tea
40 lbs of coffee, etc.

20 yards of linen

This form, like all economic forms, has a definite material base,
that is, a definite foundation in human history.

This form 'expresses

the value of the whole world commodities in terms of a single

commodity set apart for the purpose, namely, the linen, and this
represents to us

their values by means of their equality with linen'.

(I, 66).
It is this General Form that all the different, opposed, commodities
(and by extension all the particular concrete types of labour
embodied in these commodities) are united in one commodity.

The

previous 'defiCiency in unity' of the total form is now overcome.

As such this General Form of Value preserves within it the elementary
form, but in an inverted way:
"All commodities now express their value (1) in an
elementary form because in a single commodity; (2)
with unity, because in one and the same commodity.
188

This form of value is elementary and the same for all,

therefore general." (I, 65).
And this unity, summed up in the General concept is no mere
mechanical unity, no mere addition of each commodity, individually,
apart from the rest, 'finding' the form of its value in one single,
excluded commodity.
cal unity,
.......

quite the contrary:

the unity is a dialecti-

for in one excluded commodity is represented the

ensemble of all commodities, their joint action.

(This should be

seen in the light of the earlier discussion of the nature of

dialectical concepts es opposed to those constructed on the basis
of purely formal thought.)

This point is made clear when Marx

compares the elementary and expanded forms with the general.

"The two earlier forms either express the value of each
commodity in terms of a single commodity of a different
kind, or a series of many such commodities. In such cases,
it is, so to say, the special business of each single
commodity to find an expression for its value, and this it
does without the help of the others. These others, with
respect to the former, play the passive parts of equivalents. The general form of value, C, results from the joint
action of the whole world of commodities, and from that
alone. A commodity can acquire a general expression of its
value only by all other commodities, simultaneously with it,
expressing their values in the same equivalent; and every
new commodity must follow suit. It thus becomes evident that,
since the existence of commodities as values is purely social,
this social existence can be expressed by the totality of
their social relations alone, and consequently that the form
of their value must be socially recognised form." (I, 66;
author's italics).
Thus it is not that each commodity 'finds' its value in its passive
opposite.

Now we have a transformation of opposites.

for the

excluded commodity (here the linen) finds the value of all the other
commodities in an objective process, one where 'every new commodity
must follow suit'.

The passive has now become active and the active

189

passive.

The social relations of commodities are now revealed as

objective relations in and through which 'by joint action' the

value of each commodity is expressed in the one excluded commodity.

If the General value-form embraces,as it does, the whole

world of commodities in their movement, then it must be the

abstract epitome, a condensed history of this whole world, or, as
Marx says (I,

67), the 'social resume' of that world.

Now we are on the edge of the emergence of the money-form, expressed

by:
20 yards of linen
1 coat
40 Ibs of coffee
10 Ibs of tea, etc.

2 ounces of gold

Money appears when the exclusion of one commodity, seen in the General
form, becomes finally restricted to one commodity, gold.

A commodity

which may have served as a single equivalent in isolated exchanges

(elementary form) or as a particular equivelent alongside several
others (the expanded form) now serves as a

universal equivalent.

Only when this monopoly position is firmly established does the

general form give way to the money-form.
Clearly, not all aspects of this opening chapter of Capital have been
examined.

But in tracing the transition from commodity to money.

Marx was laying the essential basis for the rest of his work as well
as making an enormous advance over anything achieved in political
economy.

for he has now traced the origin of money and in this way

laid the foundation for understanding the mystery which surrounds

this fetishised form in which men's social relationships appear

190

embodied in a metal.

Precisely because even the best figures in

political economy were unable to tackle the problem of the historical nature of the predominant forms of bourgeois economy, for them
money did remain a mystery, merely a thing, merely a symbol.
can bast look at this problem by examining Marx's theory of
fetishism and the place which it occupies in his work.

191

We

Chapter 6
MARX'S

NOTION

Of

COMMODITY
CLASSICAL

FETISHISM
ECONOMICS

AND

THE

CRITIQUE

OF

"When therefore Galiani says: Value is a relation between

persons he ought to have added: a relation between
persons expressed as a relation between things." (I, 74)
In his important book Essays on Marx's Theory of Value, I. I.
Rubin draws attention to the fact that 'Marx's theory of
commodity fetishism has not occupied the place which is proper to
it in the Marxist economic system'.

As he observes, many

writers have failed to grasp the relationship of this notion to

Marx's critique of political economy - it has, he says, often been
regarded as a 'brilliant sociological generalisation, a theory and
critique of all contemporary culture based on the reification of
human relations'.

Rubin was surely right to oppose such a view

and also that which seeks to separate out Marx's notion of fetishism as some independent entity, having herdly any connection to
Capital as a whole.

Rubin's book was first published over fifty

years ago, but in the light of the many distortions of this aspect
of Marx's work which have appeared in recent years, what he said
then carries even more force today.

In fact we shall seek to

show that for Marx his notion of fetishism is no mere literary

digression, something ancillary to the main text.

On the contrary,

as Rubin, I think, has adequately shown, it provides one of the key

elements in the foundation of Marx's entire theory and is in
particular directly bound up with his conception of economic crisis.
We know that a separate treatment of fetishism did not appear in

192

the first edition of Capital, even though the concept is implicitly

present.

Only with the second and third editions (the basis for

the English translations) did a separate section.

'The fetishism

of Commodities and the Secret Thereof' appear at the end of Chapter

One.

We know that it was the first chapter which gave Marx the

greatest difficulty.

He wrote

and re-wrote the sections dealing

with the value-form, seeking to present in the clearest way

possible the contradictory nature of the commodity-form and reveal
the results of these contradictions.

It is no accident that the

section on fetishism appears after those dealing with the valueform and no accident that this section was added as part of Marx's
struggle to present the value-form in the

most adequate manner.

But although there is a separate section dealing with fetishism,

it is not as though Marx deals with this matter and then drops it.
It is a notion which is present throughout the entire three volumes,
and one which he develops and concretizes in these volumes as well as
in the Theories of Surplus Value.
Let us start by recalling that Marx took the political economists
severely to task for having accepted the reified, alienated forms
of bourgeois economy at face value, for having failed to inquire
into the historical and social basis of these forms.

In this

critique of the work of his predecessors, Marx rejected all notions

which sought to 'derive' value (a social relation) from use-value
(a material phenomenon).

('The mystical character of commodities

does not originate in their use-value', I, 71).

In similar fashion,

Marx opposed all those views which explained the nature of money in
terms of the material-technical properties of gold, just as he
193

poured scorn on all those who sought to understand capital from the
technical nature of the means of production.
'errors' had in common for Marx was this:

What all these

they failed to distinguish

between the technical role of the instruments of labour on the one

hand, and their social form on the other.
fetishism was this:

for Marx the essence of

under commodity production, relations between

men take the form of relations between 'things'.

The social

relations are indirect relations, relations mediated through these

things, and men simply 'represent' or 'personify' these things in
the market place.

Now Marx chastised the political economists for

taking these forms 'as given' (by Nature) and not as social forms
arising under definite historical conditions, forms which would
therefore disappear under new social conditions.

Those who accept

the social relations of capital 'uncritically' in effect attribute

to things in their immediate menifestation properties which, in
point of fact, have nothing in common with this immediate material
manifestation as such.

The attention of Ricardo was directed

almost exclusively to discovering the material base of definite

social forms.

These forms of social being were taken as read and

therefore lying outside the scope of further analysis.

It was

Marx's aim to discover the origin and development of these social

forms assumed by the material-technical production process at a
definite stage in the development of the productive forces.

Here,

inCidentally, is a further clue to the distinction between claSSical

political economy and its later degenerate form in vulgar economy.
In the latter case, vulgar political economy, certain properties

194

materially inherent in things are assigned to the social form of

these things.

Hence the power inherent in the means of produc-

tion to raise labour productivity - that is the power to increase

the production of usa-values for a given expenditure of labourtime - is ascribed falsely to capital, and by extension to the
owner of capital.

from this notion comes the apologetic theory

of the 'productivity' of capital.

hand, ascribed economic

Classical economy, on the other

forms to the specific property of things.

It attempted to derive social phenomena directly from materialtechnical phenomena.

Hence capital was 'stored-up labour', rent

arose from the soil, etc.

Now whatever the inadequacies of the

notion that 'capital is stored-up labour', it at least had the

merit over vulgar economy that the connection between 'labour' and
'capital' was kept in sight, even if this connection was misunderstood.

In the case of vulgar economy, its apologetic nature

reaches its high point with the formula:

labour-wages.

land-rent, capital-interest,

for as we have already noted, in this formula the

categories of capitalist production do not face each other as

alian, hostile forms, but rather as heterogeneous and different
forms.

The different revenues are derived from different sources,

one from land, one from labour and the other from capital.
notions of any inner connections are obliterated.

All

The three

categories work together harmoniously in the cause of production.

In so far as any contradiction is admitted by the vulgar school,
it is one merely concerned with distribution - one about the
distribution of the value jOintly created by the three agents.
we have seen, it was John Stuart Mill, with his division between
195

As

conditions of production (fixed by nature and therefore immutable)

and conditions of distribution (fixed socially and therefore within
limits amenable to modification) who elaborated this aspect of
vulgar economy into a system which was taken over by Fabianism and
various other brands of reformism.

Before turning to look at

Marx's notion of fetishism in more detail, we should say a little

about the origin of this idea and its connection with the development of Marx's work.

The notion of fetishism, sketched out in the

Critique and more fully in Capital, is the product of a long line

of development, going back to The Holy Family, with its contrast
between 'social' relations and materialised forms.

We find Marx,

in this early work, saying that property, capital, money, wage

labour and similar categories, do not, in themselves, represent
phantoms of the imagination, but very practical, very concrete
products of the self-alienation of the worker.

The material

element, dominating all economic relations, is contrasted with

an ideal, with a view of the world as it should be.

In The Poverty

of Philosophy Marx says that 'Economic categories are only the

theoretical expressions, the abstractions, of the social relations
of production'.

Marx, in opposition to Proudhon, now grasped that

social relations of production stand behind the material categories

of the economy.

But he did not yet ask why this relationship was a

necessary one under commodity production.

It was only with the

Critique and Capital that this problem is thoroughly examined and

made the basis of the criticism of political economy as a whole.
Now it is explained - and this is the essential point in the notion
of fetishism - that the:
196

"absence of direct regulation of the social process of

production necessarily leads to the indirect regulation of the production process through the market,
through the products of labour, through things. Here
the subject is the 'materialisation' of productive 3
relations and not only 'mystification' or illusion".
It is espeCially important to stress this last point - that fetishism is not mere illusion, that 'fetishism is not only a phenomenon
of social consciousness, but of social being' as Rubin (p 59)
correctly puts it.

for fetishism is often worngly equated with

mystification, merely an ideological category.

It would of course

be quite wrong to see a fully worked-out theory of fetishism in

Marx's early writings, but it would be equally one-sided to draw a
rigid distinction between Merx's early formulation of this question
and its rounded out version in Capital, a position in general
adopted by the Althusserian school.

for one element found in the

Economic and Philosophical Manuscripts of 1844 (Paris Manuscripts)

is returned to throughout all Marx's later work - namely that under
capitalist relations, the products of the workers' labour confront
him as something coercive and this is a
definite material base.

coerCion, with a

This we find in this early work:

"The worker puts his life into the object; but now his
life no longer belongs to him but to the object. Hence,
the greater this activity, the greater is the worker's
lack of objects, whatever the products of his labour is,
he is not. Therefore the greater this product, the less
is he himself. The alienation of the worker in his
product does not only mean that his labour becomes an
object, an external existence, but that it exists outside
him, independently as something alien to him, and that it
becomes a power of its own confronting him; it means
that the life which he has conferred on the object confronts him as something hostile and alien".
4

197

We shall see how this theme, far from being dropped, is enriched
and developed in Capital.
Rubin is absolutely right to say that fetishism is a phenomenon
of social being and because of this alone it is present in
consciousness.

And this 'social being' is commodity production

and commodity production alone.

Marx is quite explicit on this

point.
"The relation of the producers to the sum total of their
own labour is presented to them as a social relation of
objects which exists outside them It is a particular social relation between men themselves which in
their eyes assumes a phantasmagorical form of a relation
between theings This is what I call fetishism; it
attaches itself to the products of labour as soon as they
are produced as commodities, and it is therefore
inseparable from the production of commodities.
(I, 72).
Here Marx indicates clearly that the fetishism of economic relations
arises only with commodity production.
product of capitalism only;

for him ideology is not a

false consciousness is a product of

all societies divided into clssses.

But it is only under conditions

of capitalism that men's economic relations appear to them in the

shape of things.

So this form of false consciousness, the fetishisa-

tion of the economic relations, is unique to commodity-capitalist

production.

This must be stressed against those who wish to see

fetishism as for example a product of the division of labour.

According to this view, the division of labour means that the
individual interest diverges from the general interest, that the
deployment of activity is not determined voluntarily, but by
circumstances apparently independent of man.

Man's own activity

thus becomes, by virtue of this division of labour, an alien force

198

which confronts and enslaves him, something not controlled by him.

Each member has an exclusive field of activity;

the division of

labour means that each individual can only take on a partial view
of the social whole.

What this view 'misses' is that while it is

certainly the case that in all pre-capitalist modes the conditions

of production dominate men, only under capitalism does this take
the form of the dominance of things over men.

And these things

dominate men not by virtue of a growing division of labour, but

because of the social role the products of men's labour actually
play.

Under capitalism the social relations of production are

established by means of the transfer of 'things' from individual

to individual.

This movement of things is a coercive power over

men - for it is through the movement of these 'things' (commodities,

money, etc.) that production is organised, and not according to any
conscious plan on the part of the producers.

Thus in the elementary

value-form (20 yards of linen 1 coat) we have a movement of

'thing~'

but simultaneously a definite transfer of economic forms,

of definite activities, activities which correspond to definite

social relations of production.

So it must be stressed that it is

only with commodity production (and of course its developed form,

capitalism) that definite economic forms attach themselves to things
and develop through these things.

Thus, says Marx of pre-capitalist

society:
ItThis economic mystification arose principally with respect
to money and interest-bearing capital. In the nature of
things it is excluded, in the first place, where production for use-value, for immediate personal requirments, predominates; and secondly, where slavery and serfdom form the
broad foundation of social production, as in antiquity and
during the Middle Ages. Here the dominance of the producers
by the conditions of production is concealed by the relation
of dominance and servitude, which appear and are evident as
199

the direct motive power of the process of production."

(III, 810).

Referring to the Middle Ages, Marx notes that:

"The practical and natural form of labour, and not, as in
a society based on the production of commodities, its
general abstract form is the immediate social form of
labour the social relations between individuals in
the performance of their labour, appear at all events
as their own mutual personal relations, and are not disguised under the shape of social relations between the
products of labour."
(I, 77).
And this same point is made about those early societies:
"in which primitive communism prevailed, and even in the
ancient communal towns, it was the communal society
itself with its conditions which appeared as the basis
of production, and its reproduction appeared as its
ultimate purpose. Even in the medieval guild system
neither capital not labour appear untrammelled, but
their relations are rather defined by their corporate
rules, and by the same associated relations, and
corresponding conception of professional duty, craftsmanship, etc.".
(I, 77).
These passagas (and many others could be cited) express the fact
that the uniqueness of bourgeois society consists in the peculiar
fact that the most basic relations established between human beings
in the social production and reproduction of their lives can be
known to them only after the event and even then solaly in the
'opposed' 'inverted' form of the relations between things.

Or rather

not 'even then' but precisely because the relations are unplanned,
knowable a posteriori they can become visible only through the
results of man's activities, through the things he has produced.
Under capitalism, man's reflections on the forms of social life and
therefore his scientific investigation of these forms take a path
which is not merely different but is in fact the direct opposite to

200

that of the actual emergence and development of these forms.

begins, as he must, with the result of these activities.

He

That is

why, for instance, the proportions in which the products of man's

labour exchange, appear, and can only appear, to result from the
very nature of the products themselves.

Thus: 'The quantities vary

continuously, independently of the will, foresight and action of

the producers.

To them, their own social action takes the form

of the action of objects, which rule the producers, instead of

being ruled by them.'

(I, 75).

It is necessary to keep in mind the

fact that when we say that men's social relations of production

affix themselves to things, are moved by these things, this is no
illusion, to be 'demystified' by some pure thought.
necessarily this way.

Matters appear

The inverted form taken by man's conscious-

ness is a necessary inversion.

It is precisely because fetishism

is inherent in commodity production that it cannot be 'demystified'

in thought alone but only in practice, in the overthrown of those
social relations which create the very conditions for this fetishism.
This is how Marx expresses this point.
nThe life-process of society, which is based on the process
of material production, does not strip off its mystical
veil until it is treated as production by freely associated
men and is consciously regulated by them in accordance with
a settled plan. This however, demands for society a
certain material ground-work or set of conditions of existence which in their form are the spontaneous product of a
long and painful process of development. n
(I, 80).
Only under communism will fetishism disappear, for it is only under
commodity production and above all under capitalism - where production is unplanned, where economic and social crises strike the
working class as a kind of natural catastrophe, as something having
201

nothing to do with human activity - that the basis for fetishism

exists.

As Marx says, the formulae whereby labour is represented

indirectly, in fetishistic form, in the value of its product and

labour-time represented indirectly by the magnitude of its value,
bear stamped upon them the fact 'that they belong to a state of
society in which the process of production has the mastery over
man, instead of being controlled by him'.

(I, 81).

Involved here is the notion that if fetishism will only be finally

overcome in a society of freely associated producers, then it is
equally true that the transparency of the economic relations of
pre-capitalist economy was a product of the backwardness of the
productive forces.

Marx makes this explicit in the following

passage:
"The ancient social organisms of production are extraordinarily much more simple and transparent than the
bourgeois organism, but they are based either on the
immaturity of the individual man who has not yet torn
himself from the umbilicus of the natural speciesconnection with the other men or based upon an immediate
master-slave relationship. They are conditioned by a
lower level of the productive powers of labour, by
correspondingly restricted relationships of men within
their material process of the constitution of their 5
life, and consequently to one another and to natura."
Therefore the loss of the transparent quality of the social relations
marked by the advent of commodity production - a loss which becomes
increasingly pronounced with the development of capitalism - must
not be evaluated in purely negative terms.

for the fact that men's

social relations in production become increasingly indirect, the

fact that the internal vein connecting man to man becomes mora and
more embodied in the connection between things, testifies to a
202

development of the productive forces.

The point here is that while

the conditions of production rule producers in ancient, Asiatic,

feudal and capitalist economy alike, in the case of pre-capitalist
modes, these conditions were more immediately natural - climatic
changes, soil fertility, etc.

Under capitalism man gains increasing

control over these immediately natural conditions (although of course

it can never be complete) and this is reflected in the fact that men
become increasingly dependent on social conditions to secure their
means of life.

Under capitalism, the more man gains control over

nature the more he becomes dependent on capital.

And this dependency

takes the form of a growing domination of 'things' over man and his
activities.

Thus changes in the price of a metal (gold) can, under

certain conditions, not only seem to create economic crises unemployment, currency

depre~iation,

stock collapses, etc. - but

actually do result in these phenomena.

Marx continually draws an analogy between the commodity-form of
production and the religious conceptions developed by man.

And this

is important for us here, because it underlines the fact that the

reified character of the products of man's labour just like religion
has a definite objective basis in the social relations of production.

Religion can never be fully understood if it is regarded

merely as an ideological device, carrying a definite function - for

instance, to reconcile the masses to the conditions of their exploitation and poverty.

Undoubtedly this is one side of religion ('the

opium of the people') but for Marx only one side.

ror the fact must

not be lost sight of that religion has definite material roots - it

203

expresses man's inadequate knowledge and control over nature, a lack

of development of the productive forces and the fact that in class
society he confronts nature indirectly through a set of (antagonistic)
social relations.

Only the removal of these social relations and

conditions can lay the basis for the final disappearance of religious
conceptions.

Thus 'The religious reflections of the raal world can

only disappear as soon as the practicel workaday life represents for

men transparently resolvable relationships to one another and to
nature.'

Neither religion nor fetishism arise from a wrong way of

viewing the world to be righted by the disembodied intellectual who

has grasped the 'real' relationship between man and the products of
his labour.

Just as 'after the discovery by science of the component

gases of the air the atmosphere itself remains unaltered' (I, 74), in
the same way,
determination of the magnitude of value by labour-time
is therefore a secret, hidden under the apparent fluctuations in the relative values of commodities. Its discovery,
while removing all appearance of mere accidentality from the
determination of the values of products, yet in no way
alters the mode in which that determination takes place."

'~he

(I, 75).
Let us consider this last point further by looking at one criticism
directed by Marx against Thomas Hodgskin, a member of the 'proletarian
opposition' to political economy (Th 2, 267), and a writer for whom
Marx had much admiration.

At one place Hodgskin attacked the

notion, prevalent amongst the economists, that the level of employment together with the standard of living of the working class
depended on the amount of circulating capital available.
from Hodgskin's 'correct' reply.

Marx quotes

Hodgskin says, 'The number of

204

labourers must at all times depend on the quantity of circulating

capital;

or, as I should say the quantity of co-existing labour,

which labourers are allowed to consume'.

(p 295).

And Marx

comments:
"What is attributable (in the economists' conception) to
circulating capital to a stock of commodities, is the
effect of 'co-existing labour'. In other words, Hodgskin
says that the effects of a certain social form of labour
are ascribed to objects, to the products of labour; the
relationship itself is imagined to exist in material form.
We have already seen that this is a characteristic of labour
based on commodity production, or exchange-value and this
quid pro quo is revealed in the commodity, in money to
a still higher degree in capital, in their personification,
their independence in respect of labour. They would cease
to have these effects if they were to cease to confront
labour in their alienated form. The capitalist, as
capitalist, is simply the personification of capital, that
creation of labour endowed with its own will and personality
which stands in opposition to labour."
(Ibid, 295-6).
So, for Marx, Hodgskin recognised that political economy made a
fetish of the social conditions of capital.

But for Hodgskin, Marx

proceeds to point out, this fetish was a subjective illusion, an

illusion advanced, thought Hodgskin, to cover up the class interest
of the owners of capital.
"Hadgskin regards this as a pure subjective illusion which
conceals the deceit and the interests of the ruling
classes. He does not see that the way of looking at things
arises out of the actual relation itself;
the latter is
not an expression of the former, but vice versa. In the
same way English socialists say 'we need capital, but not
the capitalists'. But if one eliminates the capitalists,
the means of production cease to be capital." (Ibid, 296;
author's italics).
This is a vital point made by Marx against Hodgskin.

ror it

involves questions not so much in economics, as in the Marxist

theory of knowledge.

If SOcial being determines social conscious-

205

ness, then this consciousness cannot be reduced to a series of mere

'illusions' or 'mystifications', the product of a distorted way of
looking at things.
sheer idealism.

To see the matter this way would amount to

Man's consciousness is a product of his social

being, of his social practice.

Thus the manner in which man con-

ceives his social relations, the

taken by his consciousness,

cannot be divorced from these relations.

things arises out of the actual relation'.

'The way of looking at

Man's social relations

are reflected in his mind and translated into thought-forms.

But

these social relations are always reflected in thought in an

inverted form.

And this inversion arises from the fact that man's

eocial relations under capitalism are formed without first passing

through consciousness.

This last point actually provides the

criterion whereby Marxism distinguishes between social relations and

ideological relations.

Speaking of the ideas of that group of

Enlightenment thinkers which found classical expression in Rousseau's

Social Contrect, Lenin says:
ItSo long as they confined themselves to ideological social
relations (i.e. such as, before taking shape, pass through
man's consciousness) they could not observe recurrence and
regularity in the social phenomena of the various
countries. The analysis of material social relations
(i.e. of those that take shape without passing through
man's consciousness: when exchanging products men enter
into production relations without even realising that
there is a social relation of production here) at once
made it possible to observe recurrence and regularity.1t
(LCW, 1).
Thus it is not at all true that the value-relations appearing in the
exchange of the products of labour as commodities are not 'really'
relations between things, but merely imaginary relations having a

206

mystical quality.

This view is directly refuted by Marx in many

places, for instance when he says,

"The labour of the individual asserts itself as part of
the labour of society, only by means of the relations
which the net of exchange establishes directly between
the products, and indirectly through them, between the
producers. To the latter, therefore, the relations
connecting the labour of one individual with that of
the rest appear not as direct social relations between
individuals at work, but as what they really are
material relations between persons and SOCial relations
between things." (I).
This pOint, that the attachment of the social relations of production to things is no mere illusion, not something to be explained
from some self-contained 'ideological sphere', is brought out
strikingly by Marx in the Critigue.
"A social relation of production appears as something
existing apart from individual human beings, and the
distinctive relations which they enter in the course
of production in society appear as the specific
properties of a thing - it is this perverted appearance,
this prosaically real, and by no means imaginary
mystification that is characteristic of all social forms
of labour positing exchange-value. This perverted
appearance manifests itself merely in a more striking
manner in money than it does in commodities."
(Cd tigue, 49).
It should be clear from the above that (a) Marx understood fetishism
to be an objective phenomenon, a product of definite social conditions and (b) the basis for overcoming fetishism is provided by the
development of the productive forces.

from this standpoint it is

clearly impossible to treat Marx's notion of fetishism as merely

mystification.
Althusser.
ism.

It is here that once again we must take issue with

for this is preciselyhow he treats the notion of fetish-

In his view ideology (false consciousness) is not a product of

207

definite social conditions but something playing what is essentially

a functional role in all societies.

He tells us, 'Ideology is not

an aberration or a contingent excresence of History:

it is a

structure essential to the historical life of societies,.7

And it

follows necessarily from this that 'historical materialism cannot

conceive that even a communist society could ever do without ideology
in ethics, art or "world outlook"'.

Ideology, for Marx a product

of definite social conditions (and in particular the division between

mental and manual labour which arises with class society), is made by
Althusser into a product of

societies.

fetishism (which Marx

sees arising specifically in connection with commodity-capitalist

economic forms) can for Althusser have no specific material basis in
definite production relations.
One task involved in refuting Althusser's view - which involves
emongst other things the attempt to draw a rigid distinction between
'ideology' and 'science' - is to demonstrate how Marx traces the
fetishistic forms associated with capitalist economy from their
simplest forms to the more complex, which are discussed in Capital,
Volume III.

Here again it is necessary to bring out the connection,

the unity, between 'logic' and 'history', of being and social

consciousness.

If the commodity is the cell-form of

the SOcial

relations of capital, the embryo out of which all those higher forms
historically emerge, then the commodity constitutes also the cellform for all those 'necessary illusions' which dominate present
society.
point:

We shall, in dealing with this problem, have to stress one

Marx does much more than recognise that political economy

deals uncritically with reified categories.

208

Nor was he content

merely to reveal that the inverted way in which the social relations
appear in capitalist society arises from the essence of the social
relations of production which form the basis of this society.

He

wanted to show that the more the capitalist mode of production

develops, the more the social relations increasingly confront men
as an external dominating power.
"By means of its conversion into an automaton, the
instrument of labour confronts the labourer, during
the labour-process in the shape of capital, of dead
labour, that dominates and pumps dry, living labourpower. The separation of the intellectual powers of
production from the manual labour, and the conversion
of those powers into the might of capital over labour,
is, as we have already shown, finally completed by
modern industry erected on the foundation of machinery.
The special skill of each individual insignificant
factory operative vanishes as an infinitesimal
quantity before the SCience, the gigantic physical
forces, and the mass of labour that are embodied in
the factory mechanism and, together with that
mechanism, constitute the power of the 'master'." (I, 423).
And this power is a real, not 'illusory' power.

And because it is

a real power, it brings real powers, the working class, into conflict with it.

Marx stresses this point in the course of his

discussion 'Machinery and Modern Industry':

"Hence the character of independence and estrangement
which the capitalist mode of production gives to the
instruments of labour and to the product, as against
the workman, is developed by means of machinery into
a thorough antagonism. Therefore it is with the advent
of machinery, that the workman for the first time
brutall revolts a ainst the instruments of labour."
(I, 432;
In other words, says Marx, the very development of the fetishism
of the products of man's labour under capitalism - seen in naked
form with the emergence of modern industry - brings with it, at
209

the same time, the social force with the potential to bring about
an end to this fetishism.

History does not set only 'problems',

it always, in setting these problems, also brings into being the

necessary forces through which these problems can be overcome.
"Mankind thus inevitably sets itself only such tasks
as it is able to solve, since closer examination will
always show that the problem itself arises only when
the material conditions for its solution are already
present or at least in the course of formation."
(Critique, 21).
So for Marx the growth of fetishism, far from being an indication
of the growing ability of capital to suppress the revolutionary
struggle of the working class, is on the contrary an expression
of the ever-growing contradictions of capitalist society which bring
the working class face-to-face with these contradictions.
"The growing accumulation of capital implies its growing
concentration. Thus grows the power of capital, the
alienation of the conditions of social production
personified in the capitalist, from the real producers.
Capital comes more and more to the fore as a social
power, whose agent is the capitalist. This social
power no longer stands in any possible relation to that
which the labour of a single individual can create.
It becomes an alienated, independent social power which
stands opposed to society as an object, and as an object
that is the capitalist's source of power. The contradiction between the general social power into which
capital develops, on the one hand, and the private power
of the individual capitalists over those social conditions
on the other, becomes even more irreconcilable and yet
contains the solution of the eroblem because it implies at
the same time the transformation of the conditions of
production into the general, common, social conditions.
This transformation stems from the development of the
productive forces under capitalist production, and from
the ways and means by which this development takes place."
(III, 259; author's italics).
As we have said, Marx's task was to reveal the origin of this

210

reification in its most simple form, commodity production.

Let us

begin with the simplest expression of this perversion which reaches

its high point in capital - that is with the elementary value form
itself, 20 yards of linen 1 coat.

This is the first expression

of the 'externalisation' or 'alienation' of the opposition between

value and use-value which exists in every commodity.

from this

point all the higher forms of fetishism can be considered as a growth

in the contradiction between the production of use-values and the
social forms through which that production develops.

When commo-

dities come into the world as use-values this is merely their

'plain, homely, bodily form'.
"They are, however, commodities only because they are
something two-fold, both objects of utility and at
the same time depositories of value. They manifest
themselves therefore as commodities, or have the form
of commodities only in so far as they have two forms,
a physical or natural form and a value-form." (I, 47).
It is this fetishism, inherent in commodities, which is more clearly
and strikingly expressed in gold.

In making this point, Marx refers

to the value-form of the commodity as 'ideal'.

"The price or money-form of commodities is, like their
form of value generally, a form quite distinct from
their palpable bodily form, it is therefore, a purely ideal
or mental form. Although invisible, the value of iron,
linen and corn has actual existence in these very articles."
(I, 95).
Now what does it mean to say that the value-form is 'purely ideal'?
Does this mean that, like value, money is purely a mental state, a
figment of individual imagination?
means.

211

Clearly this is

!21 what

Marx

for Marx, value is an expression of a definite social relation.

And

we know that for Marx social relations were objective - therefore

value cannot be something present merely in consciousness.

5imilar-

ly, Marx explicitly rejected the idea that money was a mere symbol,
that is, he rejected the notion that money was something purely
imaginary, thus 'although gold and silver are not by Nature money,
money is by Nature gold and silver'.

What does Marx mean therefore,

when he tells us that money is purely ideal form?

In his essay

'The Concept of the Ideal', the Soviet philosopher Ilyenkov, in

examining this question of Marx's use of the term 'ideal', has done
much to throw light on the notion of fetishism.

As he notes, the

term 'ideal' is used today largely as a synonym for 'conceivable',

phenomena that are represented, imagined and thought.

(If we were

to follow this definition, as he correctly pOints out, there would

be no point in talking about any 'ideality' existing outside human
consciousness.)

When Marx uses the term ideal in connection with

the value-form, he certainly does not mean something present only

in consciousness.

On the contrary - and this is Ilyenkov's main

point in connection with the value-form - Marx means that the valueform is 'ideal' because it is totally distinct from the palpable,
corporeal form of the commodity in which it is presented.

In other

words, the value-form is 'ideal' but certainly exists outside human

consciousness,

As Ilyenkov states, in what is a clear reference to

the degeneration of philosophical work under the impact of Stalinism,

"This use of the term may perplex the reader who is
accustomed to the terminology of popular essays on
materialism and the relationship of the material to
the 'ideal'. The ideal that exists outside people's
212

heads and consciousness, as something completely

objective, a reality of a special kind that is
independent of their consciousness and will, invisible,
inpalpable and sensuously imperceptible, may seem to
them something that is only 'imagined', something
'supersensuous,.10
As Ilyenkov argues, the term 'ideal' in this debased version of
materialism, has more in common with Kantianism and the pre-Hegel
tradition in philosophy than it has with Hegel (and,
with Marx).

by

extension,

ror Hegel,

"This relationship of representation is a relationship

in which one sensuously perceived thing performs the
role of function of representation of quite another
thing, and, to be even more preCise, the universal nature
of that other thing, that is, something 'other' which iA
sensuous bodily terms in quite unlike it, and it was this
relationship that in the Hegelian terminological tradition
acquired the title of 'ideality'." (1977a, p. 94).11
It is clear that if we follow this line, Marx's designation of the
value-form as 'ideal' takes on a quite different meaning than it
would for a 'simplistic' materialism, and a meaning which throws
much light on Marx's notion of fetishism.

By 'ideal' Marx in no

way means that the value-form exists only in the brain of the

commodity owner, but in the fact that the corporeal form of a thing
(the coat) is only a form of expression of a quite different 'thing'
(linen as a value) with which it has nothing in common.

The nature

of this linen is represented, expressed, embodied, in the form of a

coat and the coat is the 'ideal' or 'represented' form of the value
of the linen.

And far from being something expressed only in

consciousness, this representation expresses a relationship entirely

objective, which actually determines the behaviour of man without
his being aware of it.

The social relations under which the linen

is produced find their embodiment, their representation, not directly,

not immediately, but in the mediated form of the coat.
213

These social

conditions are alienated in the form of the coat.

The transforma-

tion of nature by man which is involved in the production of linen,

a definite form of human objective activity, is represented in an
'object', the coat.

And this is what Marx means by ideality - the

form of human social activity represented in a thing.

Ilyenkov puts

the point this way:

"Ideality is a kind of stamp impressed on the substance
of nature by social human life activity, a form of the
functioning of the physical thing in the process of
this activity. So all the things involved in the social
process acquire a new 'form of existence' that is not
included in their physical nature and differs from it
completely - their ideal form."12
The commodity form is 'ideal' precisely because it does not include
a single atom of the SUbstance of the body in which it is represented, because it is the form of quite another body.
body exists only ideally;

And this other

the chemical enalysis of gold will find

within it not a single atom of boot polish.

Nevertheless gold

'represents' a hundred tins of boot polish (say), and this representation is performed not in the consciousness of the seller of the polish it takes place through a market according to forces which is no sense
depend on any consciousness of the money-form.

Everybody spends

money without necessarily being aware of what he is spending.

Ilyenkov correctly notes, 'In

(As

Capital Marx quite consciously uses

the term -ideal" in this formal meaning that it was given by Hegel,
and not in the sense in which it was used by the whole pre-Hegelian
tradition.'

This example alone serves to show that Marx did far more

than 'coquette' with Hegel's terminology.)

It is in this sense that the simplest value-form (20 yards of linen
214

 1 coat) contains the essence of the fetishism inherent in all

bourgeois economic forms.

The 'peculiarities' of this form

(abstract labour in the linen taking a form directly opposed to

it, the concrete labour in the coat, etc.) thus contain the key to
grasping the riddle and source of the fetishism of all bourgeois
economic forms.
The reification of production relations associated with simple
commodity production develops further with money.

The 'riddle

of the money fetish now becomes dazzling to our eyes', says Marx.
In one of his earliest economic writings he had written about the
fetish quality of money as follows:
"Why must private property develop into the money-system?
Because man as a social being must proceed to exchange
and because exchange - private property being pre-supposed
must evolve value. The mediating process between men
engaged in exchange is not a social or human relationship,
it is the abstract relation of private property to private
property and the expression of this abstract relationship
is value - whose real existence as value constitutes money.
Since men engaged in exchange do not relate to each other
as men, things lose the significance of human personal
property.n 13
This was written in 1844 as notes on James Mill's Elements of Political
Economy,.

It serves to indicate once more that r'larx's notion of

fetishism found in Capital was a true development of all his previous

economic writings right back to the 1840s.

(It puts Althusser's much

vaunted 'epistemological break' into true perspective.)

Marx con-

tinues:
"The personal mode of existence of money as money - and not
only as the inner, implicit, hidden social relationship or
class relationship between commodities - this mode of
existence corresponds more to the essence of money, the more
abstract it is, the less it has a natural relationship to

215

other commodities, the more it appears as the product and

yet the non-product of man."14
All the products in a situation of commodity production have first
to be exchanged for a third material thing, in order that these
commodities can receive their adequate social validation.

This

material medium has become independent of the world of commodities

this provides the basis for the emergence of money.

And it is

through this medium of money and through it alone that man's

social bond is established.
pocket.

Man carries his social power in his

In this sense, as the power of money grows, it constitutes

the 'objective bond of society' the 'real community' as Marx at one

point characterises it.

Thus, far from money overcoming the

reification inherent in the simplest exchange of two commodities,

this fetishism is heightened and intensified.

Thus Marx tells us,

'~he

same contradiction between the perticular nature of

the commodity as product and its general nature as
exchange-value, which created the necessity of positing
it doubly, as this particular commodity on the one side
and money on ther other contains from the beginning
the possibility that these two separated forms in which
the commodity exists are not convertible into one
another." (G, 147-8).

That is, the contradiction between use-value and value is not

definitely, finally, resolved in money, it is externalised, made
more open, more antagonistic.

Not merely does the value of one

commodity have to realise its value 1n another commodity, now, in

the money form, all commodities have to express their value in one

single commodity.

This reification of social relations is more

extreme, but, by this very fact, so is the possibility of criSiS.

Hence:
216

"As soon as money has become an external thing alongside

the commodity, the exchangeability of the commodity for
money becomes bound up with external conditions which
mayor may not be present, it is abandoned to the mercy
of external conditions."
(G, 147).
And this is not all.
dictions arise.

In the exchange of commodities further contra-

for the act of exchange is .split into two mutually

independent acts, namely exchange of commodities for money and

exchange of money for commodities - in short purchase and sale
(c - M - C).

The acts take place at different times and places and

their immediate identity is destroyed.

If purchase and sale balance,

this balance can only be the result of accident, never of conscious

will.
"Circulation bursts through all restrictions as to time,
place, and individuals, imposed by direct barter, and
this it effects by splitting up, into the antithesis of
a sale and a purchase, the direct identity that in barter
does exist between the alienation of one's own and the
acquisition of some other man's product. To say that these
two independent and antithetical acts have an intrinsic
unity, are essentially one, is the same as antithesis. If
the interval in time between the two complementary phases
of the complete metamorphosis of a commodity becomes too
great, if the split between purchase and sale becomes too
pronounced, the intimate connection between them, their
oneness, asserts itself by producing a crisis."
(I, 113-114).
Marx immediately follows this with e passage which underlines the
point we are here at pains to stress - that the growing reification
of economic relations - the process whereby they are increasingly
attached to things and their connection with human labour, man's
practice, appears to be less and less immediately obvious, involves
the very same process which creates within capitalism the source of

217

its breakdown.

That is, the theory of fetishism and theory of

capitalist crisis are in Capital completely united, inseparable.

"The antithesis, use-value and value: the contradictions
that privata labour is bound to manifest itself as
direct social labour, that a particular concrete kind of
labour has to pass for abstract human labour; the contradiction between the personification of objects and the
representation of persons by things; all these antitheses
and contradictions, which are immanent (author's emphasis)
in commodities, assert themselves and develop their modes
of action in the antithetical phases of the metamorphoSis
of a commodity."
(G, 414).
Purchase and sale are equally essential but 'there must come a
moment when the independent form is broken and when their inner
unity is established externally through a violent explosion
there lies the germ of crisis'.

(G,19B).

Here is only a

a 'possibility' of a crisis and further development is required

before this possibility is transformed into a reality.

Hence

'The conversion of this mere possibility into a reality is the

result of a long series of relations, that, from our present standpoint of simple circulation, have as yet no existence'.

(1, 114).

This path, from possibility to reality, is treated by Marx when he

traces the growing independence of this money-form, separated from
the products it 'represents'.

Exchange separates itself out as an

independent aspect, cut off from the actual production of commodities.

Now commodities are bought not only for consumption but for

re-sale.

The obtaining of exchange-value becomes the Object of

these latter transactions.

'The rise of exchange (commerce) as

an independent function torn away from the exchanges corresponds to

the rise of exchange-value as an independent entity in money, torn
218

away from products'.

(G, 149).

And here the possibility of crisis

is now considerably enhanced:

"This doubling of exchange - exchange for the sake of
consumption and therefore exchange for exchange - gives
rise to a new disproportion The possibility of
commercial crisis is already contained in this separation.
But since production works directly for commerce and only
indirectly for consumption, it must not only create but
also and equally be seized by this incongruity ~atween
commerce and exchange for consumption."
(G, 149).
And finally, the emergence of money as the general equivalent in
which all concrete labour is objectified cannot escape the contradiction that while money is a commodity unlike any other particular
commodity, it nevertheless does remain a particular commodity.
Gold still has to be brought out of the ground, refined, transported, etc.

It still has to be produced as a commodity.

The

opposition of the money-commodity to the world of commodities can

never be absolute.

As Marx says of money:

tIt is not only the

exchange-value, but at the same time a particular exchange-value.

Hence a new source of contradictions which make themselves felt in
practice'.

(G, 151).

Now of course the analysis of the fetish character of money does not
exhaust the fetishism of bourgeois economy.

This fetishism grows and

develops along with tha emergence and development of capital.

As we

have seen, it is a growth in which (a) the social relations between

men, based upon their labour, become increasingly obscured, hidden
behind the things which this labour produces.

The inner connection

between these outward forms is increasingly lost and can only be

grasped through strict scientifiC analysis but (b) this development

219

is accompanied, and must be accompanied, by an equal growth in the

coercive power of these alienated forms (money, capital, etc.)
which increasingly stand as oppressive rorces, opposed to the needs
of the working class.

So the increasing 'reification' of these

forms goes hand-in-hand with the conditions for their overthrow.

The growing social power of capital brings it increasingly into
conflict with the needs of society as a whole.

The growth of this

fetishism inherent in commodity production reaches its consummate

expression in interest-bearing capital (M - M').

ThiS, says Marx,

is the mystification of capital in its most extrme form'.

494).

(Th 3,

And elsewhere,
"of all these forms, the most complete fetish is interestbearing capital. This is the original starting point of
capital-money and the formula M - C - M' is reduced to
its true extremes M - M', money which creates more money.
It is the general formula of capital reduced to a meaningless resume."
(Ibid, 453).

Interest-bearing capital is capital which 'no longer bears any birth

mark of its origin';

it represents 'the perversion and objectifica-

tion of productive relations to the highest degree';

form without content'.

it is 'only

(Ibid, 384).

In a very interesting passage Marx deals with the various forms of capital in order to demonstrate that this interest-bearing capital is
the automatic fetish, where money appears to breed money, where capital
appears able to e,xpand without reference to any natural-objective
factors such as the length of the working day, size of the proletariat,
etc.

To illustrate this point, Marx takes the elements of the Trinity

rormula in full:

220

"The land or nature as the source of rent i.e. landed

property is fetishistic enough. 8ut~a result of
a convenient confusion of use-value with exchange-value
the common imagination is still able to have recourse
to the productive power of nature itself, which, by
some kind of hocus-pocus, is personified in'the landlord."
(Ibid, 454).
Marx turns next to the formula 'Labour is the source of wages',
and demonstrates that here there is a confusion between labour as
a material activity and labour in a definite social form.

However,

despite this,
"the common conception is so far in accord with the
facts that even though labour is confused with wagelabour and, consequently, wages, the product of
wage-labour with the product of labour, it is nevertheless
obvious to anybody ~ho has commonsense that labour itself
produces its own wages". (Ibid, 454).
Similarly, when capital is considered as part of the productive
EEocess, it still continues to be regarded as an instrument for
acquiring the labour of others, and 'here the relationship of the
capitalist to the worker is always presupposed and assumed'.
(Ibid, 454).

And even though in the case of merchant capital,

capital eppearing in the process of circulation where ideas that

profit arises from swindling, 'buying cheap and selling dear', etc.
_ even here profit is explained as a result of exchange, that is,
arising from a social relation and not from a thing.

(Ibid, 454).

Quite different is interest-bearing capital:

"It is capital in its finished form - as such representing
the unity of the productive process and the circulation
process (here is the subject of Volume III) and therefore
yields a definite profit in a definite period of time. In
the form of interest-bearing capital only this function
remains, without the mediation of either productive process
or circulation process.
Interest-bearing capital is
221

the consummate automatic fetish, the self-expanding value,

the money making money, and in this form no longer bears
any trace of its origin. The social relation is consummated as a relation of things (money, commodities) to
themselves."
(Ibid, 454).
Marx deals with these forms in Volume III but the actual growth
of the fetishism is traced throughout the entire work.

Considering

'the road travelled by capital before it appears in interest-bearing

capital', (Ibid, 481), Marx examines the connection between the
circulation process and the creation of surplus value.

Whereas, in

the immediate production process, the relationship is still very

obvious or cannot be misunderstood,

'The circulation process

obliterates and obscures the connection.

Since here the mass of

surplus-value is also determined by the circulation time of capital,

an element foreign to labour-time seems to have entered' (Ibid,
482).

And when we come to profit (as distinct from surplus value)

the inner connection between labour-time and the economic forms Is

even more obscured and reified in things.
"This profit is first received for a definite period of
circulation of capital, and this period is distinct from
the labour-time; it is secondly, surplus-value calculated
and drawn not on the part of capital from which it originates
directly, but quite indiscriminately on the total capital.
In this way its source is completely concealed. Thirdly,
although the mass of profit is still quantitatively identical
in the first form of profit with the mass of surplus-value
produced by the individual capital, the rate of profit is,
from the very beginning, different from the rate of surplusvalue; since the rate of surplus-value is s/v and the rate
of profit is sic + v. fourthly, if the rate of profit is
presumed given, it is possible for the rate of profit to rise
or fall and even to move in the opposite direction to the
rate of surplus-value."
(Ibid, 482).
And the matter becomes even more obscured when we consider the
average rate of profit and with it the conversion of values into
222

cost prices.

Here,

"the profit of individual capital becomes different from

the surplus-value produced by the individual capital in
its particular sphere of production, and different,
moreover, not only in the way it is expressed - i.e.
rate of profit as distinct from rate of surplus-value but it becomes substantially different, that is, in
this context, quantitatively different". (Ibid, 482-3).
In this form of profit:
"Capital more and more acquires a material form, is
transformed more and more from a relationship into a
thing, but a thing which embodies, which has absorbed,
the social relationship, a thing which has acquired a
fictitious life and independent existence in relationship to itself, a natural-supernatural entity; and in
this form of capital and profit it appears superficially
as a ready-made precondition. It is the form of its
reality, or rather its real form of existence. And it
is the form in which it exists in the consciousness and
is reflected in the imagination of its representatives,
the capitalists." (Ibid, 483).
The point here is this:

the formation of 'prices and production'

constitutes a more perverted and estranged form than 'value' for

now, outwardly" the price of production'depends not upon labour,

but upon capital.

This development of fetishism is a reflection

not only of increasing mystification but of the contradictory

development of the social relations of production.

That the forma-

tion of an average rate of profit - and the contradiction this

entails between value and price - is itself engendered by the
development of the productive forces was many times stressed by
Marx.

Thus:
"What competition, first in a single sphere achieves, is a
single market value and market price derived from the
various individual values of commodities. And it is

223

competition of capitals in different spheres which first

brings out the price of production equalising the rate
of profit in the different spheres. The latter process
re uires a hi her develo ment of ca italist roduction
than the previous one.
III, 177; author's italics.
It is because of the growing disparity in the organic composition
of capitals between and within industries, that values are transformed into production prices.

The regulator of capital accumu-

lation, the establishment of an average rate of profit, demands a

deviation, a 'contradiction' between price and value;

this is a

contradiction made not in thought but in material reality.

In this

form, 'price of production', is reflected the growing social power

of capital.

For now the capitalists as a class take part in the

exploitation of the working class as a class.

Expressed in this

'thing' the price of production, is the growing antagonism between

the two major classes, an antagonism raised to the level of society
as a whole:
"In each sphere (it transpires that) the individual capitalist,
as well as the capitalists as a whole, take part in the
exploitation of the total working class by the totality of
capital and in the degrees of that exploitation not only out
of general class sympathy, but also fOr direct economic
reasons. for, assuming all other conditions to be given,
the average rate of profit depends on the intensity of
exploitation of the sum total of labour by the sum total of
capital."
(III, 193).
In this form (production prices) Marx notes 'capital becomes conscious of itself as a social power in which every capitalist participates proportionally in his share of the total SOcial capital'.
191).

(III,

The capitalists now become communists, as Marx wryly observes.

But at the same time the material conditions are laid for the unity
224

of the working class in its struggle against the entire capitalist

class.
Enough has been said about these forms of surplus value to reveal
the truth of Marx's proposition that economics is not concerned
with things but with re!ations between people, and in the last
resort between classes, but that these re!ations 'are always bound
to things and appear as things' (Engels).

In place of the fetish-

ieed categories which bourgeois social science uncritically

adopted, Marx presented a quite different conception of the process
of social production, that is, one which started not with a view of
things 'in themselves' but a process in which men, in unity with
nature and with other men, continually renew both themselves and the
world of wealth which they create.

As Rubin has rightly said, this

revo!utionary conception of the scope and nature of political

economy involved drawing a consistent distinction between productive
forces and productive relations, between the materia! process of
production on the one hand and its social form on the other.

It is

under capitalism (as it develops autor commodity production) that

these social relations acquire a material form and because of this
the 'things' to which the social relations are attached playa
definite social role:

as the 'bearer' of the given social relations.

The basic notions of political economy express the essence of the

various social-economic forms which in turn express the developing
production relations between the classes in capitalist society.

As

Rubin has said, 'some of these relations between and among people
presuppose the existence of other types of production relations
among the members of a given society and the latter do not necessarily
225

presuppose the existence of the former'.

15

He gives, as an

example, the relationship between finance and industrial capital

(Ibid, 32).

This relationship involves industrial capital's

receiving loans from finance capital;

but presupposed here, or

more accurately, sublated here are the relations between

industrial capital and wage labour.

On the other hand this latter

relationship - between industrial capital and wage labour - does

not necessarily involve relations between industrial and finance
capital.

from this it is clear that the economic categories

'capital' and 'surplus value' precede the categories 'interest

bearing' capital and 'interest'.

To take this pOint further, the

relations between industrial capital and the working class take

the form of the sale and purchase of

labour-power.

Sublated here

are the relations of simple commodity producers without which the

buying and selling of labour-power would, of course, be impossible.
We have noted in several places that in Marx's opinion classical
economic theory had singularly failed to grasp the nature of
money.

And the confusion which surrounded this problem amongst the

leading bourgeois economists in the first decades of the nineteenth

century found its reflection amongst the theoreticians of the
working class.

This is clear in Marx's polemics against Proudhon

and his analysis of the writings of the English socialists on the

nature of money.

The mistakes committed by these writers amounted,

in essence, to a failure to understand the fetishism inherent in

money;

or where there was some inkling of this fetishism (Hodgskin

has already been mentioned), its source was not appreciated.

226

We can

therefore conveniently draw together some of the points made about

Marx's notion of alienation by considering the functions performed
by money in capitalist economy as well as the mistakes made by
Marx's opponents on this question.

for Marx, money fulfils the

following functions:
of value

1r

~'easure

Medium of commodity circulation

Means of accumulation (hoarding)

Means of payment

World money

Right from the start we should be careful to realise that Marx is

not 'defining' money in any abstract sense.
here of definitions which

thing~

'It is not a question

must be made to fit.

We are

"-

dealing here with definite functions which must be expressed in

definite categories.'

(II, 230).

This pOint, which has consider-

able importanca for Marx's method as a whole, applies entirely to

his notion of money.

Marx, in his treatment of the functions of

money, is actually pointing to the role which money, appearing as

a thing, plays in the organisation of the social relations of
capitalist production.

As with all his categories, the functions

of money express production relations and the various functions

represent the changes taking place in the production relations
which the development of capitalism brings.

This is stressed by

Marx when he says,

"The particular functions of money which it performs,
either as the mere equivalent of commodities, or as a
means of circulation or means of payment, as hoard,

227

or as universal money, point, according to the extent

or relative preponderance of the one Function or another,
to very diFferent stages in the process of social
production."
(I, 170; author's italics).
Here once more is expressed the great gap separating Marx from
vulgar political economy.

Conventional economic thought contents

itself with enumerating various types of money systems, some of

which exist in reality, others merely in the imagination.

Marx

used to remark ironically how proud the economists were with the
discovery that money was a commodity.

But vulgar economy has

forgotten even this discovery of its predecessors.

For economic

theory, especially since the collapse of the Gold Standard in the

1930s, the commodity is only one of a number of possible moneyforms.

On this view we seem to be offered a choice, as if we were

able to select the most suitable money-type after considering all

the advantages and disadvantages of the various possible alternatives.

Needless to say, all such 'theories' are quite deVOid of

any historical sense.

Neither money, nor any ot the various function

it fills, are the result of 'discoveries'j

the various money

systems did not arise because people consciously weighed their

comparative advantages.

They have all emerged out of definite

social relations, or, more specifically, out of the contradictions

of commodity production and circulation.

For Marx, money reflects

definite social relations, a point emphasised by Rubin when, in

his discussion of the nature of fetishism, he deals with the various
functions of money in the following way:
1

If the transfer of goods from sellers to buyers and the

inverse transfer are carried out simultaneously, then money assumes

228

the function, acts as, a 'medium of circulation'.

2

If the transfer of goods precedes the transfer of money, and

the relation between sellers and buyers is transformed into a

relation between debtor and creditor, then money has now assumed
the form of a 'means of payment'.
3

If the seller keeps the money which he receives from his sale,

postponing the moment when he enters a new relationship as a

purchaser, then money has acquired the function-form of a 'hoard'.
4

Once the emergence of capitalism takes place and a relation-

ship between a commodity owner (capitalist) and a commodity owner

(the worker selling his labour power) is established through the
transfer of money, then money has become transformed into capital.
The money which directly connects the capitalist with the worker
plays the role, or takes the form of 'variable capital'.

But to

establish the necessary relationship with the worker, the capitalist

must of necessity possess means of production, or money with which
to buy the means of production.

In this form money plays the role

of 'constant capital'.
Here are expressed the various 'sides' or 'aspects' of money, as they
have actually come into being.

Marx's task (as with all the reified

forms of bourgeois economy) was to grasp the historical character of

the various functional forms of money, or its 'conceptually determined
forms of existence', as the Grundrisse puts it.

So the various

functions of money cannot be reduced to a series of formal definitions,

akin to those encountered in conventional text-books of economics.
The functions dealt with in Capital were the ones which money has
actually played (and continues to play) in the evolution of bourgeois
229

economy.

The properties of money were abstracted from history.

Thus the first specific form of money lies in its function as a

measure of value - the first because it emerges directly from
commodity circulation 'The principal difficulty in the analysis
of money is surmounted as soon as it is understood that the
commodity is the origin of money.'

(I, 64).

And all the functions,

as evolved in Marx's analysis, must be seen in the same way - as

expressions, in the alienated form of this metal, of definite social
relations.

As commodity production develops so money assumes its

various roles, revealing its essential quality in its highest form

as world money, universal money.
"It is only in the markets of the world money acquires
to the full extent the character of the commodity whose
bodily form is also the immediate social incarnation of
human labour in the abstract. Its real mode of existence in this sphere adequately corresponds to its ideal
concept."
(I, 142).
All the mistakes of political economy in connection with money take
the following basic form:

one aspect of money, one of its several

functions, is isolated from the rest and elevated to the rank of

being the defining function of money, one from which all the rest
can be derived.

Rosdolsky quotes H Black, a critic who none the les9

appears to have some insight into Marx's work,

"The strict division of these functions from the substance
of money (social value) and likewise the separation of the
functions from one another, is a striking feature of
Marx's theory of money. Other theoreticians define money
as a means of commerce, a unit of account, e means of
exchange or a means of payment, i.e. they elevate one
particular function to the position of being the determining
function on money and then somehow derive all the remaining

230

functions from the main one. In contrast to this Marx

strictly separates the essence of money from the
services which it is able to perform, owing to its
particular character." 16
But if political economy derived the functions of money from one
basic function this derivation was necessarily devoid of any
historical content.

And for Marx this mistake - which led to a

confusion of money's various functions - is one concerned not with

economic theory as such, but again involves philosophical questions.
ror political economy, as we have seen, the social relations of
capital were fixed by Nature.

It was the very nature of 'things'

which determined the social relations of capital.

The political

economists did not grasp that these 'things' were the bearers of
historically changing and developing social relations and therefore
the changing social function of these 'things' (money, means of
production, etc.) had to be examined.

for Marx the various functions

of money, as they had evolved, represented the development of the

social relations of modern society.

........

This is why all the various

functions of money, in their transition and interconnection, had

to be investigated.

To abstract merely one function of money (as

instrument of circulation, means of accumulation) was, in effect,

to deny the historical character of bourgeois social relations.
for this had the result of isolating this 'thing' (gold) from that
totality of social relations which this metal, 1n its diverse
functions, represented.

To grasp the role of money in modern society

(that is to grasp it concretely) it was necessary to combine its

many abstract properties into a series of concepts.

This is why

the essence of money only emerges at its highest level when it

231

fulfils the role of world money and hence 'Its real mode of existence in this sphere adequately corresponda to its ideal concept.'
Mistakes of the type we have mentioned were clearly evident in the
metalist theory of money, a theory which is associated with the
early development of capitalism.

The early representatives of

this school, such as Thomas Mun (1511 - 1641), held that gold and
silver were the only true forms of wealth, trade capital the only
legitimate form of capital, and they confined the functions of
money to the single ana as a means of accumulation (money as a
hoard).

They attempted to explain this single function of gold by

reference to its very nature.

In replying to these ide8s, Marx

shows that objects of one kind or another only assuma the various
functional forms of money as the social relations demand.
the adhereQts of metalism failed to grasp.

This

Contemporary metaliata

aim to show, but without success, that the instability of capitalist economy and its contradiction can be eliminated and capitalism
rescued by means of the 'miraculous' power of gold.
Marx's treatment of 'money as hoard' also brings out another
important point connected with the question of fatishism.

When wa

said that Marx 'combined' tha abstract properties ot money, this

should not be taken to mean that he eclectically pulled together
the various functions of money as they had existed historically.
This 'combination' is always undertaken from the standpoint of
developed capitalist relations.

(The analogy of the relationship

of ape to man holds fully here.)

The hoard is, in one respect, the

clearest form of money's anatomy.

232

But although the formation of

hoards is a process cammon to ell commodity production, it constitutes

an end in itself only where this commodity production remains underdeveloped - that is, where it has nat reached the level of capitalist
commodity production.

This is so because the less intensively and

extensively has commodity production developed, the more does money

appear as actual wealth, wealth as such, wealth in general.

The

accumulation of wealth in the form of the precious metals precedes

the accumulation of wealth in the form of ather commodities.

This

is due to the natural properties of the noble metals - their durability, etc.

Under developed capitalist conditions hoarding

continues and money, in one of its functions, plays the role of hoard,
as one of the means of accumulation.
tively different.

But this rola is now qualita-

The same object (metal) now assumes a quite neW role,

expressing quite new, mare developed, social ralations.

Needless to

say, therefore, these social relations can in no way be deduced from

the natural qualities of this metal.

Now the function of money as

hoard must be understood from the point of view of the circuit of

capital in general (M - C - M').
this process.

Hoarding is now a resting place in

Whereas in pre-capitalist economy the accumUlation of

hoards signified wealth, now their over-accumulation signifies stagnation, a withdrawal from the circuit of capital, an interruption in
the process of their metamorphosis.

Thus:

"Countries in which the bourgeois form of production i8

developed to a certain extent, limit the hoards concentrated in the strong room of the banks to the minimum
required for the proper performance of their peculiar
functions. Whenever these hoards are strikingly above
their average level, it'is, with some exceptions, an
indication of stagnation in the circulation of commodities,

233

of an interruption in the even flow of their

metamorphosis." (I, 145).
This same mistake - taking one particular function of money out of
its real historical context and deriving the rest from it - was
made by Ricardo and his school, although from a different angle
than in the case of metalism.

The error committed by Ricardo con-

sisted of the fact that he raised to the level of dogma that money
was merely a medium of circulation.

According to Ricardo's con-

ception, money is only an instrument for the circulation of

commodities.

It was not, for him, a necessary form of the existence

of the commodity in which the contradictory nature of the labour

embodied in the commodity (abstract and concrete labour) must
manifest itself in exchange-value, as general social labour.

Money

was, for the Ricardians, a means for effecting the union of purchase
and sale, of the buyers and sellers of products.

The exchange of

commodities was transformed unwittingly into the mere barter of

products, of simple USB-values.

This represented a return not only

to pre-capitalist production relations, but even to condition6'

prior to simple commodity production.

Circulation, like ell economic

relations, has two aspects, closely relsted.

In so far as this

circulation transfers commodities from those for which they constitute non-use-values to those for whom they are use-values, this
process consists simply of the appropriation of objects for human
needs.

However, to the extent, that this process takes place through

private exchange, mediated by money, and the relations between these

ommodities (and indirectly the buyers and sellers of the commodi-

234

ties themselves) to one another are objectified in the different

forms of

money~

then it gives rise to definite SOCial relations.

Marx is careful to distinguish these two

aspects~

making the

latter the subject matter of political economy.

aut Ricardo

reduces this latter relationship to the former.

And implied here

was the denial of any possibility of capitalist crisis.

so precisely because the

first~

This was,

basic, condition of capitalist

production, is that the product of labour must,assume the commodityform, and therefore this product must express itself in the alienated
form of money.
"Since the transformation of the commodity into mere usevalue (product) oblitarates the essence of exchangevalue, it is just as easy to deny, or rather it is
necessary to deny, that money is an essential aspect of
the commodity and that in the process of metamorphosis
it is independent of the original form of the commodity."
(Th 2, 501 ).
This same point i's made against vulgar economy with even more force.
"With regard to this subject, we may notice two methods
characteristic of apologetic economy. The first is the
identification of the circulation of commodities with
the direct barter of the products, by simple abstraction
from their points of difference; the second is, the
attempt to explain away the contradictions of capitalist
production, by reducing the relations between the persons
engaged in that mode of production to the simple relations
arising out of the circulation of commodities. The production and circulation of commodities are, however,
phenomena that occur to a greater or lesser extent in modes
of production the most diverse. If we are acquainted with
nothing but the abstract categories of circulation, which
are common to all these modes of production, we cannot
possibly know anything of the specific pOints of difference
of these modes, nor pronounce any judgement upon them. In
no science is such a big fuss made with commonplace truisms.
for instance, J a Say sets himself up as a judge of crises,
because, forsooth, he knowa that a commodity is a product."
(I, 114).

It was the ahistorical, formal view of money which Ricardo developed into the quantity theory of money.

This theory, which affirms

that the value of money (be it gold or paper) is determined

exclusively by the quantity of it in circulation, took shape in the
eighteenth century.

Its principal exponent at that time was Hume,

who held that money lacked any innate value, that its value arose
solely as a result of its functioning as currency.

With Ricardo's

view of the essence of money one can see yet another example of
the inconsistency of his economic theory.

from the standpoint of

the law of value he held that gold and silver did indeed have an
innate value, determined (as in the case of ell commodities
generally) by the quantity of labour involved in their production.
At the same time he held that gold coins had more or less value
according to the number in circulation and that, as the quantity
of gold increased, its value would fall.
from Ricardo's value theory.

Here was a clear deviation

Reducing the essence of money to a

simple function (instrument of circulation) the upholders of the

quantity theory of money confused the laws of full-value gold money
and token money (paper money) and wrongly assumed that any quantity
of full-value gold money could be in circulation at anyone moment.
from this it followed that commodities entered circulation without
a price and money

~ithout

a value, and that prices of commodities

altered according to the quantity of money on the market.

In

criticising this theory, Marx shows that only the quantity of fullvalue money actually needed enters circulation and this quantity
is fixed spontanaously, according to the law of value.

236

Money

(gold) has its own value, formed in production before the process
of circulation.

It fulfils its function as the measure of value

of commodities before the direct act of purchase and sale.

Marx

says,
liThe first chief function of money is to supply commodities
with the material for the expreesion of their values, or
to represent their values as magnitudes of the same
denomination, qualitatively equel, and quantitatively
comparable. It thus serves as a universal measure of
value. And only by virtue of this function does gold,
the equivalent commodity par excellence become money. II

(1, 94).
Commodities therefore enter circulation with a price and money with
a specific value and it is thus impossible for the quantity of gold
money to be more or less than that needed.

Hence the depreciation

of monetary gold in the seventeenth century (to which those adhering

to the quantity thaory usually referred) was the result not of a
surplus of gold in circulation, but of an increase in the productivity
of labour in gold mining and a consequent fall in the value of gold.
This inability to see in money the universal measure of value led
not only to a series of mistakes about the determination of the
general price level.

It was directly connected with Ricardo's false

search for an invariable measure of value.

This is a problem we

have already looked at, but can return to briefly in the light of the
discussion of fetishism.

To insist, as we have done, that fetishism

is a phenomenon of the very being of capital amounts to exactly the

same as insisting that the tmeasurementt of all commodities in one
alienated (money) commodity is an objective, necessary process and
not the tinvention' of man.

All those who think there can be some

237

invariable measure of value in fact completely misunderstand the

nature of capital.

It is because man's production relations are

indirect, relations medieted through things, thet there can never

be any invariable measure of value, be it 'labour', 'money', or
the currently fashionable Sraffian 'standard commodity'.

Values

ara measured spontaneously, becoming embOdied in one commodity

(money) because the production relations ere not, and cannot be,
planned in advance.

To deny this is to deny one of the basic

qualities of capitalism as a mode of production.

The task of true

science hers is therefore not to invent fictitious 'measures' but

to demonstrate how this spontaneous process of measurement actually
takes place.

The neo-Ricardian school does nat even begin

understand this point.

to

All those who wish to discover same standard

of value in effect want to transform capitalism into a system

capable of conscious planning.

In short they want to retain

capital while removing its contradictions.

StreSSing the need for

money as a 'thing' in which the values of all commodities must be

alienated, Marx says,
"To the owner of a commodity, every ather commodity, is,
in regard to his awn, a particular eqUivalent, and consequently his awn commodity is the universal equivalent
for all others. But since this applies to every owner,
thera is, in fact, no commodity acting as universal
equivalent, and the relative value of commodities
possesses no general farm under which they can be equated
as values and have the magnitude of their values compared.
Sa far, therefore, they do not confront each other as
commodities, but only as products or use-values." (I, 86).
How is this contradiction resolved?

Nat through the 'invention' by

men of some invariable measure of value of the sort after which

Ricardo searched.

The problem is solved in practice, spontaneous-

ly:
"In their difficulties our commodity owners think like
Faust: tIm Anfang war die That t (tIn the beginning
was the deed') They therefore acted and transacted
before they thought. Instinctively they conform to the
laws imposed by the nature of commodities. They cannot
bring their commodities into relation as values, and
therefore as commodities, except by comparing them with
some other commodity as the universal equivalent."
(I, 86).
And Marx stresses that this process

~hereby

all commodities find

their representation is one alienated commodity is a social act:

Ita particular commodity cannot become the universal
equivalent except by a social act. The social action
therefore of all other commodities, sets apart the
particular commodity in which they all represent their
values. Thereby the bodily form of this commodity
becomes the form of the socially recognised universal
equivalent".
(I, 86).
There is here no question of gold being an invariable measure of
value.

Quite the contrary:

its value must fluctuate.

precisely because gold is a commodity

Its fluctuation in no way impairs its

function as a standard of prices.

Nor does it interfere with its

functions as a measure of value for 'The change affects all commodities simultaneously, and, therefore caeterle paribus, leaves their
relative values inter se, unaltered, although those values are
expressed in a higher or lower gold price.

(I, 98).

We have triad to demonstrate in a concrete menner that in Marx's

qualification to Galiani 1s involved no small quibble.

for in this

caveat was expressed an essential aspect of Marx's notion of

commodity fetishism, a notion absent from claSSical political economy,
for reasons we have also tried to elucidate.
239

Chap tar 7
CONCLUSIONS
This thesis has been concerned to elucidate certain methodologicalphilosophical aspects of Marx's critique of the work of the classical economists.

It has been a central contention of the thesis that

in this task the contribution which Hegel made to the shaping of

Marx's thought must be taken fully into account.

Writing to

Conrad Schmidt in 1891 Engels observed ' It is impossible to

dispense with Hegel and the man takes 80me time to digest.'
519).

Engels went to recommend to Schmidt a

(SC,

study of these sections

of Hegel's Shorter Logic dealing with the transition from

Being to

Essence because they gave quite a good parallel with Marx's treatment
of the development from commodity to capital in Capital.
We have attempted to show through a series of concrete cases that it
is indeed 'impossible to dispense with Hegel' if the revolutionary
significance of Marx's critical work in the field of political
economy is properly to be appreciated.

In taking this position the

thesis does of course depart from certain predominant traditions in

the Anglo-Saxon world.

As we outlined in the Introduction above, 1n

most cases scant regard has been peid to the philosophical presuppositions of Marx's 'economics'.

But in one respect nobody can

be free of a philosophical standpoint, whether this be a conscious

or an unconsciously held one.

In practice the position from which

most writers have approached Capital in Britain has been that of

empiricism.

Empiricism is that standpoint which believes that

240

experience has all the necessary elements for cognition

~hile

reason is capable merely of evaluating, processing, that

provided in experience.

from the individual impressions of sensuous experience.

sho~

is

Empiricism holds that the mind can grasp

the essence of things and therefore general and essential

tried to

~hich

kno~ledge,

We have

that this is not the case and that neither the nature

of Marx's Capital nor the development of science generally can be

understood from this narrow standpoint.
The line of argument in this thesis also clashes
interpretation of the real nature of Marx's

~ith

though~

much recent

particulerly

with those who have attempted to show that Marx's thought involved
an absolute break with that of Hegel's philosophy.

Hera the work

of louis Althusser has been amongst the moet significant.

Althusser

has proposed that Marxism must be rescued from a Hegelian-humanist

distortion.

He claims that Marx failed to understand the decisiVe-

ness and completion of his own break

~ith

Hegel, though his

practice, and especially his 'theoretical practice' for Althusser

involved precisely this break, a break to science.

According to

Althusser's account, this science must be 'produced' by means of a

reading of Marx's texts (here the significance of Reading Capital).
This anti-Hegelianism leads Althussar to a radically different view
of historical materialism than the one advanced in this thesis.
Althusser holds that when Marx speaks of 'essence' and 'appearance'
in his economic and historical analyses he is guilty of mystification and that the terms are only a transformation of the typically
idealist manner of demarcating the thing (appearance, phenomenon) and

241

and the concept of that thing (essence).

Hence Althusser is perforce

obliged to reject the view (the view to which we believe Marx subscribed) that objective reality - both material and 80cial reality is a totality of dialectical processes, forms of the spontaneous
movement of this reality, in which the essence of this world assumes
contradictory forms of appearance.

The taek of science for Marx ia

therefore to investigate these forms of appearance.

The internal

contradictions of any mode of production assume many forms of

appearance and all products of consciousness (we have been principally
interested in the specific case of classical political economy) are
to be understood in the first instance as such forms of the mode of
production concerned.

Hence Marx 'If material production itself

is not grasped in its specific historical form, it is impossible to

understand the concrete nature of the intellectual production
corresponding to it and the interplay of both factors.'

(Th 1,

276).

We have proposed that it was preCisely this inability of the cla88ical economists to grasp the socio-historical content of the categories
of thought (including its own thought) which constituted its chief
weakness.

This in turn arose from its acceptance of the specifically

capitalist form of production aa the final and 'natural' form of

production.

There is no doubt, that, considered in this light,

Hegel's thought stood on a higher plane than that of the English

economists, great though their contribution to the development of
science undoubtedly was.

for Hegel did see his own thought as the

outcome of the critical re-working of the philosophical thought of

242

all previous epochs, a re-working which aimed to preserve all that

was valuable in the spiritual culture of the past.

In short

Hegel's thought was imbued with precisely that deep historical

sense which was missing in classical political economy and this led
him to grasp that categories of thought in all fields (science,
art, philosophy, etc.) were not fixed and eternal thought-forma,
but were forma impregnated with a deep content - the content of the
development of thought itself.
The thesis has insisted that it is this historical aspect or
dimension of Marx's thought which must be stressed.

By way of a

rehearsal and summary of the central thrust of the thesis we can

return briefly to three instances of this stress on the historical
which have been encountered in the course of the development of the
argument.

In the treatment of labour we have tried to show that

for Marx labour was a sociel category which had therefore to be

examined from the historical angle.

It was the historical - social

nature of labour which fell quite outside Ricardo's fiald of

theoretical vision.

Without going over tha details of the argument

in the chapters above, it is clear that a recognition of the nature

and the not immodest distance separating Marx and tha classical
economists on this point has considerable implications for cartain
current theoretical controversies.

Although we have deliberately

refrained from dealing with the question in detail it is clear that

efforts in the direction of a reconstruction of political economy
in general and the theory of value in particular on the basie of the
concept of 'embodied labour' (an effort which can be said to be a

243

distinguishing feature of the 'neo-Ricardian' school of political

economy) can have little in common, at the most fundamental level,
with the work of Marx.

Labour is embodied in the most diverse

objects, produced under the most varied historical and social

conditions.

This simple, immediate, truth can never lead us to

understand the distinguishing features of labour within the framework of a definite historically-formed mode of production.

The

notion 'embodied labour' appears to be a most 'concrete' category

but, as in so many other cases, appearances here tUrn out to be
quite deceptive and even an inversion of the truth of the matter.
for to the extent that the concept 'embodied labour' ignores
precisely the social and historical conditions under which labour
is performed it is in fact a most abstract,. 'thin' (Hegel) notion.
It is no accident that what may be termed the 'Sraffa School' has
little if any notion of a mode of production.

And this omission

is, in our opinion, intimately connected with its use of the

category 'embodied labour' as against Marx's concept of SOCially
necessary labour time.

Needless to say this socially necessary

labour time does not appear empirically within the capitalist system.
And from the empiricist's viewpoint this is sufficient to rule it
out of the court of SCience, or if not rule it out, to reduce it to
the status of heuristic device, a perhaps useful way of lOOking at
reality but one without scientific content. Such is the position
of Joan Robinson in her criticism of Marx. 2
One way of characteriSing Hegel's philosophy is to say that it
raised the principle of contradiction to a central place in theoretical

244

work.

Here again we find a profound contrast between the stand-

point of Hegel (and by extension that of Marx) on the one hand

and the position of formal logic and empiricism on the other.
One important, though peculiar, feature of the history of economic
thought in England was thet one of the first important theoreticians of political economy was John Locke who was simultaneously
the classical representative of empiricism in the domain of
philosophy. 3

As we have earlier suggested, working from its

central premise that the facts of experience constituted the sole

and legitimate basis for knowledge, empiricism was led inescapably
to the conclusion that contradiction (lack of agreement between
two theories or of two aspects of a single theory) arose from an
error of thought - that is from a failure accurately to perceive
the phanomana under consideration.

We saw the consequences of

this approach to the problem of contradiction in connection with

Ricardo's attempt (ultimately unsuccessful) to understand the
contradictory relationship between the law of value on the one hand
and the general rate of profit on the other.

We have suggested

that Marx was able to resolve this problem concretely becausa ha

recognised that contradiction was the necessary form of all development.

It is only by taking this pOSition into account that the

controversies surrounding the 'Great Contradiction' between the

first and third volumes of Capital can be properly appreciated.

It

would be a not unfair summary of the position adopted by the neoRicardian school to say that they in general begin by assuming
the agreement of all the economic categories with one another only

245

then to discover a 'logical incongruity'

bet~een

the actual and

apparent movement of the capitalist economic system.

So too did

Ricardo, who merely noted this lack of agreement and left it

theoretically unresolved.

Here the neo-Ricardian school has

attempted to go beyond Ricardo (and in this sense, although perhaps

in this sense alone, warrants the designation 'neo-Ricardian') in
that it has attempted to resolve the problems bequeathed by
Ricardo, believing that Marx's approach to them was 'logically
unsound'.

But an issue arises here of no little importance:

the standpoint of

~hich

from

logic is it proposed to tackle the anti-

nomies left by David Ricardo?

And here one cannot escape funda-

mental questions in the theory of knowledge.

for if one takes the

position that the categories of political economy are merely

heuristic devices then they can be disposed of if, from the
standpoint of formal logic, they fail to yield a consistent solution.
(Here it can be said that Ricardo stood on a much higher theoretical
level.

He took the law of value to be axiomatically true and

attempted by deduction from it to explain all the other categories

within the capitalist economic system.)
As history alone reveals, 'logiC' by no means concerns a series of
self-evident truths.

But Ian Steedman seems to presume just this

when he says about the solution to the 'transformation problem'

offered by Dmitriev, von Bortkiewicz and Sraffa:
"first these solutions are logically coherent.
Second, that those who oppose such solutions never
attempt any direct logical criticism of them
No one has every presented a direct logical criticism
of these solutions and that for the simple reason
246

there is no logical criticism to be made. So far as

they go these solutions are logically sound - and
that is that." (33)4
Of course if one begins by assuming that the laws enunciated by
formal logiC are absolutely valid thought-forms5 (as this author
seems implicitly to do) then, should the relations between the
economic categories be found to be at variance with the imperious
raquirements of this logic, clearly such categories must be
redefined in order to 'fit' the logic.

On this view theoretical

activity tends to bs reduced to the collection of data through

observation, etc., data which can then be processed, arranged and
re-arranged to meet the needs of formal logic.

Thus one stumbles

across the fact that there is a contradiction between the

proposition that labour is the foundation of value, and the surface,
empirically given, relations of capitalist economy.

This must

indicate the fact that there was something logically unsound in the
initial premise which must accordingly be either re-defined or in
extreme cases dropped altogether.

We have

show~

that Marx took a

quite different attitude to the theoretical contradictions in

Ricardo's economics.

He saw these contradictions as not merely

arising in thought (although of course they were present there) but

in reality itself.

The economic categories could not be rendered

congruent with each other by means of the rules laid down in formal
logic for the simple reeson that these categories were not themselves harmonious, expressing in the last instant as they did the
contradictory interests of social classes in modern SOCiety.

Hera

two quite distinct logics and two quite different approaches to the
247

theory of knowledge were involved.

As a last illustration of the impossibility of ignoring the philosophical basis from which Marx approached his critique of political
economy we have taken the question of commodity fetishism.

Here

was a significant and inevitable lacuna on the part of the classical

economists.

Taking capitalist society to be the final and natural

form of economy they necessarily looked upon the individual in

such a society in a fundamentally abstract way, rather than from the
point of view of the specific social relations through which alone
he is able to confront nature.
in the theory of knowledge.

Here again are involved decisive questions

for Marx nature and society are con-

templated never abstractly, but by a concrete individual combined

into a network of social relations.

And it is for this reason that

the social and historical properties attached to things merge, in

the eyes of an uncritical observer, with their natural properties,
while at the same time the passing properties of such things appear
to such an observer to be bound up with the very essence (the very
'nature') of such things.

These fetishistic illusions are objective,

for Marx 'prosaically real' exactly because they are formed not in
the consciousness of an individual in bourgeois society but in the
reality itself which confronts such an individual.

It 1s thus

impossible for an empiriCism which merely recognises the immediate

outward form of

things to distinguish critically and clearly between

the social and the natural.

for Marx the material and SOcial world

could only be cognisad - that is grasped in its inner coherence,

movement and development - if one insisted on moving beyond the

realm of direct sensation and perception of the surface relations

of the phenomena concerned.

And this in turn demanded a break

from the empiricism which was in the final analysis the true source
of the theoretical limitations of classical economics.

Here again

without the dialectics of Hegel (which of course had to be reworked

from the standpoint of materialism) Marx could not have 'negated'
the work of the political economists in the way that he did.
In assessing the nature and historical significance of this negation we have outlined at the start of the thesis the limitations of
the tradition smongst those who have been concerned with the defence
and elaboration of Marx's work in political economy.

We also

suggested that recent years have witnessed a renaissance of interest

in Marx's Capital in the USSR, eastern Europe and elsewhere which
goes beyond what has previously been achieved.

E V Ilyenkov'a

work The Dialectics of the Abstract and the Concrete in Marx's

'Capital', is perhaps the outstanding example so far of this tendency,
although as already indicates its very recent appearence made it
impossible to deal with in the body of the thesis.

Here are merely

outlined some aspects of the work as they impinge upon the concarns
of this thesis, although this far from does justice to Ilyenkov's
achievement, which would involve much lengthier consideration.
Although the author makes meny interesting reference to the limitatione of political economy the real interest of his work is that he
is concerned centrally with the methodological aspects of Marx's
critique of political economy.

His book turns on the proposition

that all scientific investigation involves a necessary movement from

249

the abstract to the concrete;

the interest of what he says

involves his critical appreciation of the meaning of the terms

abstract and concrete for Marx.

He emphasises that these terms

are used rather ambiguously in both everyday speech as well as in

the more specialised literature of philosophy.

But in matters of

science there must be no such ambiguity for it is through thesa

terms, the abstrsct and the concrete, that dialectical logic saeks
to establish a series of its fundamental propositions ('that there
is no abstract truth';
to the concrate' etc.).

the thesis of the 'ascent from the abstract

As Ilyenkov reveals by means of close

citations from the literature, for formal logic and especially for
the tradition founded by Kant in the case of more recsnt philosophy,
the abstract is invariably taken to be synonymous with thosa
properties which reflect a property of an object considered separately
from the object itself, that is as something existing in the mind.
And concrete, in the usually deployed meaning, is taken as
referring to concretely existing objects.
implications of this position:

And Ilyenkov notes the

it creates the false notion that

individual things are more real than those universal laws and forms
of existence of the things themselves.
This point is important for the thesis as a whole in this sense:
if 'abstract' is taken to be that which exists in thought merely
than general abstract notions of phenomena will be arrived at along
a definite theoretical path.

This will involve isolating those

features which the senses detect in a range of objects.

(Thus for

instance to the extent that all imperialism involves political

250

dominance of one people over another this abstractly identicel fact

common to all imperialism, both past and present, will be taken to
constitute the conceet of imperialism, its essential quality.)

We

have tried throughout this thesis to reveal that this is not a

procedure which can disclose the real nature of social phenomena.
But it is a procedure which is fully in line with the empiriCist
tradition in Britain, a tradition strongly associated with the
standpoint of nominalism in philosophy.

Marx, here again following

the lead of Hegel, rejected this conception of the abstract.

for

Marx the abstract meant 'one sided' a partial view of the essence
of the phenomena being investigated.

And in the same manner,

concrete meant an all round, many-sided view ot the object or

objects under investigation.

So the concrete was not a thing

available immediately to the senses, but a combination of abstractions, or 'the unity of diverse aspects' (Critique, 206).

And by

unity Marx clearly has in mind connection, the interaction of

different phenomena within a definite system.
It is from just this angle that the concept of abatract labour,
discussed earlier, must be grasped.

Ilyenkov's work reinforces the

point that abstract labour can in no sense be taken to mean merely

a mental concept, arrived at by isolating a single feature which
all acts of labour have in common.

Undar capitalism the worker is

alienated from the products of his labour:

an oppressive 'second natura';

they confront him as

the labour which produces the value

of commodities (and by extension creatas the surplus value which

increases the value of capital) is labour cut off, separated, from

251

the producer and in this sense abstract labour.

So both concrete

and abstract labour are both forms of labour, both equally 'real'
in that they both exist independently of consciousness.
This thesis has attempted to highlight certain distinctive
features of Marx's work in political economy by exploring aspects
of Marx's relationship to classical political economy.

Clearly

not all matters worthy of attention have been considered:

because

of pressure of space some have been ignored and others only lightly
touched upon.

But a deliberate emphasis has been placed upon the

philosophical basis of Marx's work in the field of economics.

Needless to say, a consideration of the philosophical dimensions
of Marx's writings in political economy provides no 'magic key'
which will yield immediate answers to the complex problems to be
solved in grasping the nature of Marx's critique of capitalism
and the work of its theoreticians, both 'claSSical' and'vulgar'.
8ut we have tried to demonstrate that it does provide an essential
theoretical 'orientation' as it were in the solving and clarification of many of the key debates which continue amongst Marxists
and between Marxists and non-Marxists.

It is to be hoped that the

lines of approach mapped out here will be fruitful in the further

development and concretisation of work within the field of
political economy.

252

NOTES

TO

CHAPTER

G Lukacs, The Ontology of Social Being, Vol.2, p.10.

Ibid, p.11.

Ibid, p.12.

C Slaughter, Marxism and the Class Struggle, p.151.

Ibid, p.151.

G Plekhanov, Selected Philosophical Works, Vol.3, p.117.

for some useful background material on this topic see

G Planty-Bonjour, The Categories of Dialectical Materialism.

5 Macintyre, A Proletarian Scianca.

for Lenin's specific criticisms of Dietzgen see~,

14 pp. 243-9. Lenin of course saw positive features in the
work of Oietzgen and defended him against the Machists who
seized upon certain weaknesses of his work.

10

M H Cobb, Political Economy and Capitalism:

Economic Tradition.

11

R Rosdolsky, The Making of Marx's 'Capital', p.xii.

12

Ibid, p.xii.

13

Engels, Anti-Duhrins, pp.21-22.

14

Engels, Dialectics of Nature, pp.42-43.

15

Engels, Anti-Duhring, p.18.

16

In Marx Engels Collected Works, Vol. 3, p.231.

17

Lenin, 'What the friends of the People Are', pp.14-15.

18

G Pilling, 'The Law of Value in Ricardo and Marx',

Economy and Society, 1:3, pp.280-307.

253

Some Essays in

NOTES

TO

CHAPTER

J M Keynes, The General Theory, p.1.

See R L Meek, Economics and Ideology, pp.51-74. for an

examination of the relationship between classical political
economy, Marxism and the 'vulgar' school see R Rowthorn,
'Neo-classicism, Neo-Ricardianism and Marxism', New Left
Review: 85 (1974).

Marx, Poverty of Philosophy, p.91.

L Althusser, Reading Capital, p.50.

Marx Engels, Collected Works, Vol.3, p.270.

Ibid, PP. 270-1.

Ibid, p. 271.

Ibid, p. 271.

A Smith, Wealth of Nations, pp.25-7.

10

Ibid, p.65.

11

Ibid, p.5S.

12

Ibid, p.5S.

13

0 Ricardo, Principles, pp.13-4.

14

Ibid, p.15.

15

Ibid, p.17.

15

Ibid, p.20.

17

Ibid, p.27.

18

E Roll, A History of Economic Thought, p.100.

19

Lukacs, loc cit, p.13.

20

Engels, Anti-Duhring, p.462.

21

Ibid, p.462.

22

K Popper, Conjectures and Refutations, p.316.

23

K Popper, The Open Society and its Enemies, Vol.2, p.39.

254

24

On the question of the 'breakdown' of the Ricardian labour

theory of value and its connection with the limits of
formal logic see E V Ilyenkov, Dialectical Logic, esp.
Chapter 10.

25

A J Cutler et al Marx's Capital and Capitalism Today, p.35.

26

D Ricardo, Principles, pp.37-a.

27

Ricardo: Letters 1816-18, Vol.7 of The Works and Correspondence

of Ricardo, p.377.

255

NOTES. TO CHAPTER

0 Ricardo, Principles, p.11.

Marx Engels, Selected Correspondence, pp.73-4.

A J Cutler at aI, Marx's 'Capital' and Capitalism Today, p.26.

Engels, Anti-Duhring, part III, chapter 4.

Quoted in R L Meek, Studies in the Labour Theory of Value, p.257.

R Rosdolsky, The Makin9 of Marx's 'Capital', p.114.

Marx Engels, Selected Correspondence, pp.238-9.

Marx, Critique of the Gotha Programme, p.18.

This point is explored at length in Ilyenkov's, The Dialectics

af the Abstract and the Concrete in Marx's 'Capital'. He
establishes in detail that in formal logic 'abstract' is taken
to mean a mere mental image and 'concrete' to actually existing material things, seen in their isolated state. He
demonstrates that Marx rejected this view of the matter. See
chapter 7 below for further remarks on this work.

10

for a stimulating study of Locke's social theory see

C 8 McPherson, The Theory of Possessive Individualism. Despite
its insights this work fails to grasp the significance of
Marx's distinction between labour and labour power.

11

J Zeleny, The Logic of Marx.

12

Ibid, p.13.

13

Ibid, p.18.

14

0 Ricardo, Principles, p.118.

15

J Zeleny, p.18.

16

Marx Engels, Selected Correspondence, p.250.

17

0 Ricardo, Principles, p.18.

18

Marx, Value: Studies by Marx, p.214.

19

M H Dobb, Palitical Economy and Capitalism, p.18.

20

Ibid, p.29.

21

J Zeleny, p.20.

256

NOTES

TO

CHAPTER

See F Engels, Ludwig Feuerbach in Marx Engels Selected

(1 volume edition), p.613.

See Marx Engels, Selected Works, p.96.

C B Mcpherson finds a similar development in political theory

to that in political economy. He holds that the political
theory stretching from Locke down to James Mill was founded
upon a notion of 'possessive individualism'. This amounted
to the view that man is the absolute and natural proprietor
of his own capacities, owing society nothing for them. On
Mcpherson's account, society was seen by classical liberal
theory as a collection of individuals related to each other
through their possessions, in which relation the role of
the market is crucial. After James Mill, Mcpherson sees a
growing syncretism in the form of attempts to abandon
possessive individualism while retaining bourgeois values.
In this he finds a close parallel to the degeneration of
political economy following the death of David Ricardo. rar
this view see C B Mcpherson 'The Deceptive Tasks of Political
Theory' in Mcpherson's Democratic Theory.

I I Rubin, Essays on Marx's Theory of Value, p."?

G W r Hegel, Science of Logic, p.44.

Marx Economic and Philosophical Manuscripts in Marx Engels

Collected Works 3, pp 332-3.

G W r Hegel, op cit, p.3.

Ibid, p.6.

Quoted in E V Ilyenkov, Dialectical Looie, p.184.

~orks

10

G W r Hegel, Encyclopaedic LogiC, pp. 105-6.

11

On this matter see E V Ilyenkov, The Dialectics of the Abstract

and the Concrete in Marx's 'Caoital', p.46.

12

Marx Theses on Feuerbach in Marx Engels Selected

p.129.

13

Engels Dialectics of Nature, p.170.

14

Marx and Engels The German Ideology, p.42.

15

Ibid, p.42.

16

Ibid, p.42.

17

Marx Engels Selected Correspondence, p.48.

25?

Wo~ks

ed cit

18

G W f Hegel, Encyclopaedic Logic, pp.62-3.

19

G W F Hegel, Science of Logic, p.588.

258

NOTES

TO

CHAPTER

Engels, Dialectics of Nature, p 69.

Ibid, P 70.

L Althusser, Lenin and Philosophy, p 5.

Ibid, pp 79-80.

Ibid, p 80.

Ibid, p 89.

Ibid, p 91.

Ibid, P 80.

Ibid, p 73.

10

Ibid, p 74.

11

Ibid, p 84.

12

Opposing the 'humanist-historicist' interpretation of Marxism

Althusser argues that 'Marxist theory is produced by a
specific theoretical practice, outside the proletariat, and
that Marxist theory must be "imported" into the proletariat'.
(Reading Capital, pp 140-01).

13

R Rosdolsky, The Making of Marx's 'Capital', p 95.

14

P M Sweezy, The 'Theory of Capitalist Development, p 26.

15

Ibid, P 226.

16

Marx, Value: Studies by Marx, p 215.

17

Ibid, pp 215-6.

18

Ibid, P 216.

19

K Korsch, Karl Marx, p 123.

20

R L Meek, Studies in the Labour Theory of Value, pp 173-4.

This omission on the part of Meek is surprising given Marx's
explicit statement on the question of the value form.
Urging Marx not to alter a draft he had made of the early
sections of Capital, Engels writes 'The second sheet
especially bears rather strong marks of your carbuncles, but
that cannot be altered now and I do not think you should do
259

anything more about it an addendum, for, after all, the

philistine is not accustomes to this sort of abstract
thought and certainly will not cudgel his brains ror the
sake of the form ,of value. At most, the paints here
established dialectically might be set forth historically
at somewhat greater length, the test made from history,
so to speak, although what is most necessary in this
respect has already been said. (Se, 226). And Marx's
reply is important in bringing out the importance of the
value-form: 'As to the development of the form of value
I have and have not followed your advice, in order to
behave dialectically in this respect as well. That is to
say I have 1) written an appendix in which I describe the
same thing as simply and pedagogically as possible, and
2) followed your advice and divided each step in the
development into paragraphs, etc., with separata headings.
In the preface I then tell the "non-dialectical" reader
that he should skip pages x-y and read the appendix
instead. Hare not merely philistines ara concerned but
youth eager for knowledge, etc.' (Ibid, 228).
21

Marx, Value: Studies by Marx, p 61.

260

NOTES TO

CHAPTER

I I Rubin, Essays on Marx's Theory of Value.

for a useful survey of the treatment of the concept of

fetishism in recent literature, see T Kemp, Karl Marx's
'Capital' Today, PP 15 - 29.

Rubin, op cit, p 59.

Marx Engals, Collected Works, Vol 3

Marx, Value: Studies by Marx, p 38.

Ibid, P 38.

L Althussar, for Marx, p 232.

Ibid, p 232.

E V Ilyenkov, 'The Concept of the Ideal' in Philosophy 1n

the USSR. pp 71 - 99.

10

Ibid,

11

Ibid, P 84.

12

Ibid, P 86.

13

Marx Engels, Collected Works, Vol 3, pp 212-3.

14

Ibid, P 213.

15

Rubin, op cit, p 32.

16

R Rosdolsky, The Making of Marx's 'Capital', p 135.

72.

261

NOTES TO

CHAPTER

This is why all ideological forms have, within limits, a

definite objective content and can never be reduced
merely to a 'way of looking at the world' from a particular
social or class standpoint. This would be to adopt the
position of relativism. Marx never saw in classical
political economy merely a form of bourgeois ideology,
merely an expression of the needs and interests of a rising
class. Within limits classical economics elaborated
concepts and categories which were 'objective thought forms'
that is which did, to an extent, reflect objectively existing social relations of production.

In her little book Economic Philosophy Joan Robinson

writes (p 3) 'The hallmark of a metaphysical proposition
is that it is not capable of being tested.' Of the
concept of value she observes 'Like all metaphysical
concepts, when you try to pin it down it turns out to be
just a word.' (Ibid, p 26). Of course this is the
empiricist visw of the metaphysical as something lying
beyond immediate experience.

A point of clarification is perhaps needed here. EmpiriCism,

like every other standpoint in philosophy (rationalism,
dialectical materialism, etc.) claims to provide an account
of how knowledge develops. But this does not meen that
proponents of empiricism were actually in their work, their
practice, actually guided by this standpoint. Ilyenkov
suggests that this wss certainly the casa with Ricardo. In
the course of grappling with a series of theoretical and
practical problems Ricardo was forced to the recognition
that science could not, whatever the claims of empiricism,
rest content with the mere reworking of things given in
sensation and contemplation but had to establish the
inner unity of phenomena. Here Smith antiCipated Ricardo for
he too was obliged to deal with both esoteric and exoteric
'sides' of economic phenomena. See E V Ilyenkov, op cit,
PP 17B - 194.

Ian Steedman, Marx After Sreffa. p.33. For a perceptive

review of Steedman's book see G 8 Kay, 'POlitical Economy:
Hegel versus Ricardo' in Critigue No 10-11, pp 92 - 102:
Winter/Spring 1978-9.

262

Of course within limits the propositions of formal logic

are true; they become untrue precisely when these
tolerances are exceeded. Thus on the principle of
identity, A-A, Engels notes 'like all metaphysical
categories it suffices for everyday use, when small
dimensions or brief periods of time are in question; the
limits within which it is true differ in almost every
case and are determined by the nature of the object'.
Engels, Dialectics of Nature, p. 215.

Ilyenkov puts this point neatly in another of his writings

when he says 'It is not true that the world is cognised
in our sensations. In sensations the external world is
only given to us, just as it is given to a dog. It is
cognised not in sensations, but in the activity of thought,
the science of which is logic '
E V Ilyenkov, Leninist
Dialectics and the Metaphysics of Positivism, p 29.

263

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Philosophy in the USSR, Progress,
Moscow (1977).

ILYENKOV, E V

Dialectical Logic, Progress, Moscow

(1977).
'

ILYENKOV, E V

The Dialectics of the Abstract And

The Concrete in Marx's 'Capital'.
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ILYENKOV, E V

Leninist Dialectics & The Metaphysics

Of Positivism, New Park, London (1982).

264

KAY, G 8

"Political Economy: Hegel Versus

Ricardo", Critigue 10-11, London,
Winter/Spring 1978-79, PP 92-102.

KEMP, T

Karl Marx's 'Capital' Today.

New Park, London (1982).

KEYNES, J M

The Generel Theory Of Employment.

Interest & Money, Macmillan,
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KORSCH, K

Karl Marx, Russell & Russell,

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LUKACS, G

Histor & Class Consciousness,

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LUKACS, G

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MARX, K

Letters to Kugelmann, International

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MARX, K

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MARX, K

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Collected Works (Vols 3 & 4)

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Marx & Engels: Selected Works
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MARX, K & ENGELS, f

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McPHERSON, C 8

265

MEEK, R L

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Selected Philosophical Works (Vol 3)

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The Open Society & Its Enemies

(Vol 2), Routledge, London (1966).

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"What Is Dialectic?" in K Popper,

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Letters 1816-1B (Vol 7 Of The Works

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History or Economic Thought,

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267

oor ex In

e orl Ina

eSls.
-......-ome ex

oun

C ose 0

e sine.

-......-ome Ima es

IS or e

The law of value in

icard and

arx

by the individual families.

It h2S c\"olt"ed
the Spanish conquero:--, ane
l'\..ish colonial regime.
~ used here had it not been rer"derec
~ a landed property. So the Spa.::ish
~glicised. It Tcfers to a kind of
qnd as!?umed ethnic origins, an::: is
~~ tered by

Geoffrey Pilling

the degree to which producrion is

f course. 'IVhat is described is b:<..;;.ed 0::

q others. It refers mainly to t he
1 sser extent to the Cochab:~mb.:. :-egio::_

Kubler, George (1952) The ['~:5;':1.T!

Caste oj Peru, I795- I 9-1 o : !l F.'?'l!
Stud)1 Based

I: .,

Tax Record.; _nd

'C/1su.s Reports. \Vashington, D C.
Lewin, Bob 'ao (1957) La Rt~dior. i.
UpG1!

T,ipac Amaru y los orlgl.!1lef d. L

cmatlcipacioll America1lO. Butnc-5 _ i~<~_
Lyncb, John (1957) SpO/:.islt C.;.:.JIii,,:

Ad,ui7,;stration I782-18IO. Lo""~()n.

Morner, ;\1agnus (1969) 'Tho! -:-'1eor.and Prolcticc of Racial Segn::t;'.!t:.:l in'

Colonial Sp~nish ~~.erjc:a', H,s; cry 0/

Loti1l AIIZ(,1"1Can Clt'illsallo,,- L o:-::on.
Osborne, H. (195:!) lndiCins oj : _<

Andes. London.
Paredes, H:gnberto (1956) Tiar..L'17:"-'
y la P"O'i:i,lda de fllgrn;i. L:~ P.:Lo
Paredes, M. Rigobl.;rto (1965) La
Altipio,licie. La Paz.
parry,]. H. (1966) The Spat~,.I; _"'borne Empire, London.

ParSon, Ebie C. (1945) P <fJ:Jd:!_

Chicago.
P fialmr.a, L~.i~ (1 946) Hislon'/Z
Econolllica de Bolivia (2,\"0Is.). L.r Paz.
Piel J. (1967) 'Un soul.,,"cnlcnt =-_ru!
peru~'ien: Tocroyoc (19 21 )', R,~~
d' his toire modem/! et COlll cmpowir.!
10 XlV.
.
-Rene-Moreno, G. (195 9) La 11_!:':: d,
-Potosi i!1I 1795. PotosI.
.,
~ey >1'05, Harae! (1937) Cl quzon",. L~
~:lZ.

eyeros, Haf~d A .. (!963) Jl:slvr..::

''':)ncial del ]t1Ij,0 Boilt'1all11. L:i P;u..

Trquidi , Artllro (1,)66) EI F'iI~":'':''''''IO
" America Y la R('jonllt..l A.::nna
::!:301iviona. Cocha bam ba.
'oHmer, Gunter (1967) B,tol/;,r-_;:s
~()Iitih und I1t'1.(jl/ur1l71gs-slrul :U! :- ~ t ( f

. bstract
,\ st2.tement of ::"lIar: 5 law of \'alue and the place which it occupies in the
stru..:ture of his eco~QnUc studi~s. A ritique of the trealmenl of the
b\\ of nlue as fouod in ~e work of several writers- principally
:-'laurice Dobb and :'onzld ~reek. The implications of thi~ critiqu<": an
c~:lrnination of Rica:do's method in the light of Das K(/[>ila!. The wider

imr!ications of the

i~;;;ue.:;

discussed for l\Iarxist scholarship.

ihere can be little GOU t th2t for academic economists at ] ;J~t, the
~in object of their :;rtac~~ ag.:.:nst :\larxism cantin les to be it s thl'ory
~ ynIue. This is as t.rue of :\Iarx's 'friends' (such as Joan Robinson
~d m:my of her coL:.3g1!cs in the Cambridge School) (IS it is f his
.... Jemie ' . IVe do not pro:,ose to answer all these attacks. Thh; \\\Iuld
~ i.rnpossiblc in the con:ines of a single p"pt'r; in any lSt.: mmt f
:~"m ba\ e failed to ;:.d\"2:-ce on tho~c issued by lHihm-13awerk more
-: n ~eyenty years ago.
IIl~e.1d, we inh::nc. to restal> as simply as possible the e:scntial
, tun::::. of this law ane the place it occlIpiul in 1\1:arx's \\ lk as a whole.
- the light of this s:.att::l.cnt we wish to Sllgg<::-t that fund amenta l
~ors k\'e been coomi::ed t,articu larly by Engli:;h \\"ril~r , manv
! imi..r:g to write as : farY;sts, in their treatment of this law. Fil1~ll;!
e intend to examine the~,- errors i.n the light of l\1:.1I"X'S rcl.1tion!;hip
l" c1:!~ica l political CCa"lnor:ly, 3.!1d in particular to Ricard .1
The best statement \yhi.:h ::'1:nx maue about his bw (If "\ aluc-an
..... 'ount "hi h Lenin ~d\'i-ed dl student of Capital to co i:ult car~
:.llY-I$ to be found i::. his famolls letter to Dr. Kugelmann f July r r,
!!1 '. V,'c reproduce the c:tical passage and th n ufTcr ~OJrlC ,-OlliT11cnts
~

it.
... EYen if there '\ ere no harter on 'valLIe' in Illy hook, the
of the re;!~ rc]::,-ion3hips which r givc ,,"ould ('''Wain h
pr of of the real y;:._u\.. :-d::.~ion . The nonsense ilblllll till' n~n" it)'
(if );,o\'ing the co~-:~pt of \';.:.Ju arises from c01l1pll t ' it;T,.)!':!n,-\!
bot' of the subjec: dc.Jt \\i-h and of the method of sd.'nl:c.
Eyc:"}- hild kno\y ~ -h . : a cOHntr: "hi h cUlscd to \\f rk, I \\ ill
not :1)' for a Yl:ar, but for u few weeks woult! die. En!f\' child
kno ,'S too, t)'a t the I112."; of products COlT 'spon ding to the

an~l: sis

-!:i:olligricch Pau Zit E'ld(' tic/" };.v:, :::..;/::,,:

r.~74r-I8:iT). Herlin.
_ .
Volfe, Eric (1967) PLomllls. 1-n,;.;;'\ 'ood Cliff., N.].

282

different ne~c5 require different and quantitatively deter ::t. d

of the ro!:al1aboul" of society. That this necessity :
distributing social labour in definite proportions cannot bi:' :0'
aW:l)' with by the particular form of social production but :4~. only change 6e form it assumes, is self evident. No natur;.: L
C:ln be om' :1'.'.-:1)" "ith, ":hat can change, in changin.:::-a h:t-.,n' \..
ClrUH1.';t.lOC(;S, is the form in which these laws operate. _-ll ~ {~.
form ",hieh thi:: proportional division of labour OpeT:lt(.'$, 1.......
stah: of ~ocidy Whert! the interconnections of social labour :s
manifCf.ttU in ~he pri'i.:ate exchange of the individual produ-..; l
labo llr, is prl.cisely the exchange value of these products. '1 .C
science consists pn.ruely in working out hoZIJ the law of n: .c'~
operatc~. So th::.t if one wanted at the very beginning to 'v";)::U.,"
all tht! phenornC:1a which apparently contradicted the law, .~..:
would ha,'e to gi\'e t e science before the science. (l\1arx, 1(' 7.i,
pp, 73-4)
-- .

m(',m~;

In our view this is an extremely important passage and in. :. St"

the rest of thiJ pape:- will be a commentary on. the ideas which -;;l: '"..
are implicit in it. ~h..l.-x evidently wished to stress one basic iC! ;::-~
historico-re1ative ch:ll':lcter of all the categories of political eC1:::or y
\Ve mean thi' in the ;:en~e that for him none of the categorie.s I!1~in politic:ll cconomy--sucn as 'production', 'division of labour', ..-can be understood c,'cep: in thcir relations to the specific m<~
production of which they iormed a part.
'The categories of bourgeois economy . , . arc forms of t'::. ~!:..
expressing with social yalidity the conditions and relations of a df:::,ii
historically determL.'1ed mode of production viz., the produet:::l !
commodities' (?-.hrx, J96I, p. 76).2 But this recognition of the rL .1.:...nature of economic categories-a recognition which the thl:C:~j -f
historical materialism rcquired-did not mean however that th('rt",
not featurt!s common to m:lfiy if not all modes of production. TF;', .
inevitable in that all ~ocieties had this much in common: tha: :he;
involved some mechanism for the allocation of social labour bc:~'" ~ ....
the various branches of economy, Socialist society will be no du-:,i' 1'!
in experiencing this univer-al nee-d. However, ancl this is cruci.J., ~'-:,
form which this mechmisn: t~es differs widely from society to sOC:e~'.
The differences depend ult:.mately, upon the structure of the prodt:.::ntrelations and it was to be one of :0.Iarx's chief preoccupations to C$t..:-!;c~
. . -in opposition to the yulglr school-the dependence of 'distrib",::H..
on 'production'Having madc clear the precise nature of this task, Mar . show~ :':.tne speciji.ca differentia of the capitalist mode was the dominant po:-::cn
achieved within it of commodity production, and the transforrr;~::' '1
of the category 'labour' into the category 'labour power'. GivCH '~:~
hoW was the allocation of social labour bet\\'een the different bra!''' -

;.:L
0:

283

/1.., of .. ~uc In Ricardo and Marx

.c. r

d? It was effected,

:ln~'\

rec ::'\b. .,', only through the

. cJ:nrutJdi ti 'S:lS qui\ alent, thrc gil their x 'hange

\,,,:t.<::i,

~;changc

And, a

ali sec, this c.1tcgor~ 'c'chJ."'ge \ .Iue' \.,'as but the phenomenal
~ ~~ of '\ 11t1e', l~or l\Iarx, in oth .:- words, the law of yaJlJc reflect'd
thC' (I.'1ly , o:<sibJc, indir ct, mecha i.:;m ',\hcrt.!i>y ~oci.ll lab"ur _could he
di!t~:blltcd in:l ommodity pt:odudng .')ci .. IY. The la .o of rallle r,fleets
.. ~~dfLC social rc/aliolls {ddt}, o/I/Ira/NmdeT tOll/lllodity (an 1ta'lillllady
(. . :tdisl (OII11J1odily) IJroc/ucrion, and 1I11dl}, flt~S(! c01,c;';:if)llS aluIII'.
"pea,kjn~ of '0 ialist . OIlOlUlC org-:ni:ation, Engels said 'The p opic
' j n:T:l ~C! everything Y ry sinlpiy, \,ithout the intern'nlion of the
muc:' f3.1 cd Jaw.' (Engels, 1962, p...1-23.)3
his letter to KII dmann, .. ~ ar\ wi. hed to dra\\' Lis friend's
tt .:ion to another point \\ ~ich,;11 jl:trticu!'lrly Ollccrn U:l in this
_per-r. mdy the f:.lct that C:lpl .. Iisn w,s . Iso l'niquc in :ltV) h 'r
, n _ in l 1t the value rdation (a Slx;:tl rdaliun) appC:l J:l~ a relation
betWt n I '.illgs. Capital is Ct):'CerI e , ..bllt h;, with hoth \ ll:m itati\'c
ro' ;ems (the xcbangl..! tatio,; pi ';.liEng hct\\ ccn 'ommo Ii i 's) and
~!<':i~in. problems (that behind t' 'e qu,llll ita live ratio .. tood :;ocial
! :ions). In xchanging commo... il's men were in fa<:t \. xchaoging
their labt:l r. For J\Iarx, the to tac' .mcn~ of ~ocial l't I1t iOl'" to things
t.) 'il' J!'don', Fot' \1I11.Jl[ capit:lE~m the ~od;\ 1 r i;.lfiol1 I t"l 'n the
....bournfi~ld iviJu:lls ons icutl;". odety l()uld onl}' m"nif~~t:~h('m ch 's,
r a;pear nr the n I:ltiOl.' bet \(;en Objl' IS of mil t..:riai \h alth. 'I'll ~e
:,pc::.."3nc :> \\ere, as .. 1nrx pill'> it, 'ncct:' ;:tr), :tppear. JIClS'
\e

or

;. ~ockl relation
producion. arre:lrs :1S sotl)uiling ~ .. isting
:.. ar from inJidulIal hlln',.tn t ~ing~, ano the distinclive
r h iOllS into which they ~r.tt:r in the cour~c of 1'0 l\l~ ion
:'?pc.' ;)s th ' spccilic pl'op<;lli\:,,- of. thillg-it i~ this j net tr.;d
2?rt:~"an " tbi!; pro~~lcall: rt: " r:d by I/O /I/talls illl. ,im r)'
I.yst,~:afiolt [cmphno;,i' ddr.;o, <. ~P] ~h:\t i ch'lrnUl'rislic
cl nil !C-ocial forms pO"iting \.:xc!. '.ng\:-\ nllll.... (i\1:tr , 197 1 p. 41))

Or ag&in
'" .. 1 .c rdation cOl1nl'ctinO'th .. l bour of unl.! indi"j';,lal with
1 t of the rest :lpP\:.lr l not ;)) dirc<.t ~o ial rt:i:1tio,,:; k,', en
in 1i\iJu.l!S .ll "o1'k, but as r:hrlt ,lley "C(/lly (Jj (' [l.:mpll:1"i: .,d cd,
GP] alc)'inl rebtiolL be ~\(.cn 1 U30l1S and Goci.i n! tivns
b "w\:cn things.' (i\f.lo" lY';f, p, 73)
\ Y lr:'lpOrlant re$u]t

ilO\H:J

fr :n thi conC'\;ption of ~pp :\1.

rICC"

cs r.t(crs 11'...... r..ppL:lranCCl>: tl.I...Y c )ulo o. I)' b dcstroYl'd 1 y 1)\ erthruwing

atcgori\!s which ~llst:li:'lcd hI m. \lan~ did nut ~Cl; his

.er 1. ~s one of trippi ng aw y the iIlu',iOIl of a1 i~ li~!ll. to
~~ '~l . ing:; ':lS they 1 'ally \\' rei, Th~ conceptiun is ind~ J im )!i ... it
1..'1::1 :' O"e ~rc.\ttncnt of lIpitcl \\r 1 h ~ ck to r dlll..'t' if'. medlOd to a
\':l.."le Y Cif ~ .ciological 'moJd buililing'. TllU~ one prominr.;llt \uitt!r
th.
~"

CCO:,}OIl';C
I

284

:,r

puts tit,> mattl:r this way in discu."sing his rcqtlin:U1 m

sue'l
'modd': 'But to l')(,1'l11it all) full quantit \tiv' ~tatcmcnt . be de,
suc1l g(lrl'rnill~ dilllensions or ellliti~'s to which tIll': price-, &,:' I ~ .J.t
connectl'd ll)\bt be rdnll'lJ in J way \\hidl clnhks tlll'l \ to :'0:: r" u(.~
to :t con :non tl.:nn. ' (Dobb, t9+o, p. IT .) For him, lVl:lrxi.,:n ~ uPt:.:(!'
in an '()'wlational' sense in that 'l.lh lIr' provi<ks sllch a J"'t t..t r t
which :111 the other entities in his modd cnn be rcJu d.
For) Ian., no sl.H:ll task prc;)C1Ht,J itscJ f. IJ is :'lim \.\.13 c: to rtd:. e
nil the pkrw'ncna of the systt.'m (such as the structur -! of pric ) to
the dd.;rOlin:1tion of ynlue hy laL our-time, but on th ~ U. ,m' 01 e
of c.\'j,fai!.,l/g these phlnuml:J1.l by dcmonstrating how the) 0 :ld 1
reconcil ed. with the olwration of the law faIlle. 1Jcnee his S~OI f r
all lho$r intellt on 'pl'O\'inS' the Jaw of value, rathc:r tLan : e'-in tu
find out how it operated.
Whik not :lIlticipnting l\,Iar~'s snlution to thi " probl m.~.; uch
can be said: the entire method of apilal is bastd upon ,11C ccnt cp,; n
that thc t ling in itsdf (in this cn:;e 'val\u;') Cflll unli pre.:.:n i" if
through it~ conuatlictory opposite, its npJll!3ral1 C (to I'\n~"Uc '.
our illustr~ltioll , 'exchallgc-vnlue' is the form of appcar,l'ltl! (/ \a'ue')
In olher \\orJs, i\hrx r/~j\.!t:t('d l"unt's sc:paralion of the 'thin in j. :f'
from it.: ':lp\war,l.lIcc' in f:\\onr of IJcgd's mdholl. The ' 1. k c::\l iX'S
critique of political economy was ]lui ne which invoh l. 1 h:-n fin i~"
;)::;.a 'constam l in tt;;rms of which cverything could be qll lntiii. bl:' d
-:::.", cst:1blishing th~ laws of mcdi:ltiun through. which th e 't < net"
phcnomcru m,1I1ifcsted. it.:ielf as 'appearance'. 'Hence law i:. 11''': b:.:yo_
.\ppcaranel', bui. is ili/fn{'(lit1tc~r preStl1t in it; the rl.!:11m vf 1 'i ' ...
qui('~c 'nl counterfeit of the e. i~tillg or appearing 'Vtlrld.' (I L:- J, 19-9,
p. L33.) .\s we shall sce, \\hile Ricardo gr<lsped. the r :lttUe of -. C'
problem facing political economy his method prevcnt d '::1, fro. 1
arriving a :l satisfactory ~olution to it.
MaL ', \, haYe suggcstl..d, traces the many links bt:tWt.:"n 't1SC (;~
anel 'appearnn e', demonstrating the ncccil~'lry nalUrc of C _ 1.~: r.
This is why he is able to writt.: 'The di.~covcry [of the d tenr.:natcn
of the magnitude of value by labour-time] while rCnlovin ", a 1 l.pp 'aOl:C of mere accidcntulity from the Jelcrmination of tr . m~--nitud('
o[ the value of prod ucts, ) cl in n \\ ay alter the mode i'1. ,,:.:,' t'~
determination ta ' es place.' (196I, p. 75.) In other word,. or':: a
organisatiun of socidy can abulish fetishLm: 'Thc lifc pro .::;.s oi::...1t 'r 11
production, doc,> not strip off' its mystical veil until it i3 tTe:L:.: d :u
production by freely ::l::;soci.:lted men, :lnd is consciollsly rt-gu1zd :
them in accordance with n settled plan.' (196r, p. 80.) Or :13
Ol,'C:S
a little earlicr after the discovery by science of the com )n(. cases
of air, the atmosphere itself remained unaltered. (1961, p. -;4)
._
So far we have elaborated a number of points which nre in r telt l!l
the lctter to Kugelmann. To state matters [rom a ditTercnt ~ngi": ;., J..-':
intended to remind his fIiend of what he had already s~id ni:x 'j~ .

r:.

e It- of valu; In Rlc:'lrdo and Marx

;.:.::~C': with the publication of the Cliliqlle-th~t th<: 'guiding thr

185

ad'

, !l:S w~1rk

was the matcrialis conception of history, This was the

_!:'C.r;: which started from the proposition 1h.lt the f.ocial relalions of
ro.;:!'.:.:.tion form the 'real foundation' of Ocir::lY on which arose a
, ::ci::ll, )('gal, etc. 'superstructur .' S'p cifically Iar.; set himself the
. ~ c. .er the three volumes of Capital of tr.. ring out the m:mifolc.l
::. .. rc:mncctions betwe'n the socia l relations of pro lIction (lInder
i:.iism. the reflection of whie 1 is to be found 'n tltt t.ltq ory 'value')
-.: Ll the other phenomena \\ itbin the sy'tI!m, inc:.'uding th' class
-.!b;:e. As we shall diseov'f, this implied a In tho ~ntirely 0pP0t-'ed
. t.hr: f)f Ricardo, as Marx's I otter nlrl-ndy ~uggt,;_ :s.
It :.: now our intention, thi: pr liminnry s:~ CIncnt h,\ving he n
~ e, to l.ow that many of ~.rarx's aims anJ Inct'.ods havc be 'n
-iou.:,y mis-rcprt.:scntetl by the mnj rit)' of conul1ClH ':on, \\ ho woulJ
. ~' t::. be designated 'Murxist conomi::.ts', Wc 'n stnt with the :lSI!
.: :ne '.!adcr in this ficld, Maurice Dobb. lIe OP(:L ' his r: 'jor thlon.:tic;,l
:':":::1 the field of value theory \\ ~th a hnptcr cltitlu.. 'Thl Rlquirct::e..:.:.s of :l Theory of Value', (Dobb, 1910' ',1) I'1111lC iatdy he
t:! ::5L??OS(:s a method alien to ,iI It of i\1:ux; \~" h:\\ l aJ1'I:ndy argued
! ...! ... _ an~~lysis of 'valut;' cannot be di:;ullbo J.:eo from a 'work the
i: _ 0: y,111ch wa' to 'luy bare the law of Illotion (If m d I'll $ocicty', If
b :.."~ in mind .n.l[arx's valu.: thC01Y (us H inst that of Ricard
h: .X':11plt:) then the concern of the hapter \\\,Jt11d ~.clll to be mis". .:..c. For our only answer would cOllsi:t oC an xposi,'on of the \'alue
, ",::_.~ as deydol'l.:d in C(lJ)I'tal, If on the other hi,'),! Dobb has in
~

get/clal concept of yaluc (;,$ indeed th r main'! r of the work

him to han:) he is guilty of . tartin y flO, al1 G~~tr;tct concept
~".: lIC~ :l.S ~rarx insistc.:d we mu t. from an CXnrL1.n:lti.o 1 of the pro ss
cfsoc:.: labour as it nppC3t'S in '11 od(:;l'O sClcict)', ~larx c\'ide. tly had
h_> ~Yr..; of t:rror in mind when he n.:plicd to th~ c2.1arg~ of .\. Wngncr ;
, ....~ la~'r had accused him of 'illogirality' in " p!itting the COJW~pt of
" '_f.: i::;.+o c.change aluc and ll '~ value', 1\1:1 .' said 'Abo\ ~ all 1 do
~"t ~!z.:-: from" oncepts" thus 11 t "from the on"c.pt : raltH..". Vhat
r ~.:,:,;-, ::om is thl: ~implest SOChll form in \\hich L e pro im:t ;.f 1.\1>0111'
:... :.ne ?:'t:sent form of socidy pr ~ nts it!ldfi and his is "com lI f ,dity",'
C,L.;.;'X, :'Ji2, p. 50.) Marx j here pointing nut t. W:lgnC:f, lid others
tiu:: hi:: :St:u-,ed as a materialist from 'rcal :llli\"e ii\ illg 1 en' ,lIh.1 not
~ ~"1 iu.;aiist who tarts ahvays flom 'eo'H'cpts'. 1n thi l'l.:fil'l'l t Duhb
Ir.:Jld

~I .,..

~ "':n'... ~'

in the camp of \Vagncr, a,:, inst '\Jar".

~:!,G.i.ll'ly, when Ronald 1\Ieck writes a bo " 'to try :.ml huild
~ ::t::; Sj,t of bridge between 1\1 'rxiall econon :5 3n l their non
. h: :2.:-. colleagues' and sets ou~ to com in c ,Irs, Hobil\~on that
:,':l..":'"','S value theory '\\'as good :~n~c' (1956, p. ,) his ta:::k i:; . s ill~::.,.-;,\'t'J as Dobb's starting point the ('oml'ar'~ i1 of ~' c I lkqu:1Cy'
o'' ',.,.,.
, ,-is
. wrong. l\r
' S :1\ owed,nn
' -at. <:xp ~:")
.
I
-- ;:-,$
arx
t)
'v'r~ ::.:;:,~ ~:lg contradictions of a pll~ticular mode of prud 'ction--i

286

necessarily :1bancloncd by vulgar cconom}. \Ve need only f l,;

for l\I.i:'X, if not !'.Ieek, '1830 sounds the knell of scil.!ntific h _
econor: l." . If 'we do accep! this judgement, then WI.! ar ~ f :-:.~ ..
the in -capable concluslon that 'modern economics' with which . !
is so .k ,:~n to forge link: , cannot have a theory of valllc, 'aJ c:

othen., ist::. it was ).Iarx's point that with the emergen ce of ti'-c, ~c :.
class, i ncr(';t:;ingly consciously ranged against the capitali.:,( d.! 3'
its POh'd C,U economy, t le latter inevitably degcl1l.!rated iato ~ . :.0'
apologni c:s for the exis ting order, ultimatdy to become :l b .. ~- -'
technology . .AU modern 'price theory' (it still occasionally m a:q4!:' C
as a 'value theory') cleriv s from the category 'utility' or the rd. :i.:os' l'
between 'wealth' (for :\Iarx the aggregate of use valul:') :1 ' : t .. e
'individual consumer' . The point about lich theorie. is th 3t h.o
they are abistorical they arc necessarily a' Clcial. For 'indiviuu:lh.' ~.~:
confront 'nature' whaten'.r the moue of production; bl:wu:;e .;.
theories concern only the individual'~ relationship with natu-\.!' n I
.'.'ith his fellow man the:- are devoid of social content. 'l'hU3 it .:l- t:lpossible that 'economic:;' can hay a cate~ory , allie' which, \\ t:
is not a 'thing' but a social rdation. Yet running through t . , - '. vi
many of those who would wi. h to 'defend' l\Iarx or 'pwisc' i:. - he
concep~ :on that thq have a rival value tht!ory to answer. D obb .:-:'
of 'the tWO major vall1e thel}ries which have contl.;stccl the \.: (;o:v~ic
field' (19+0, p, u) and proceeds to sugge t that both (he m'l._ .)f
course the 'labour' theory and marginal utility analysis) mc(..~ r-:s lr.n 1
requirernc.> nts of 'adequacy': 'Quite a number of thcoric:s of a' U! il
be deri\'cd with no means of choice between them e. cept th ir -: . . l'
elegance.' And in a later work he r peats this view in cv ' n -:c':
t erms (Dobb, 1955, passim but pal'ticubrly pp. lIe-II). In t l: am'
fa shion, :\Icck aC'_l!pts P:lreto'~ and Bohm-B:.lwerk's utility "n:11, ::" .
constituting an alternative value theory to that of Marx which he - .'
to defend (11)36, ch. 6). Both these writers wrongly sec tht; ;r .: .
merely expo:;ing the penumbra of approbation with which . de
theories surround capitalism. Put another way, the mist.lke tht!Y OUl
make is to fail to see the significance of the profound tlistinction -...: h
Marx and political economy-however uncle:.lrly in this htt er Cl!l.drew between 'wealth', the sum of material objects and valll"', a . ;1'
relation :.pecific to capitalism,
_ .
This is not a minor point of difference with these writers. F i!:
,. closely connected with a number of equally erroneous concep:ior.
. f
which they hold ab out value theory. Dobb, for example, h.:G t:- -- t,
ans\ver the qucstiJn: vVby did Marx choose labour as the basi,. f- . h'
value theory? Wby not choose capital or land a the category in ~!:-;.n-s
of which everything else is computed? Here is the an wcr:

In the case of land or capital, clearly there were serious prac:5:.li

obj ections to taking them as a basis; difficulties which wou.: \l

187

ell"" of value in Rlardo and t1arx

ha 'c excttded any of thos which. were harg~d against the

labour th ('Ir),. . .. cr' are more dissimilar t }: ,n man- ours of

labour. In the case of capital there was the mo-e cn:cial

objcction that it W:!.5 iL~elf a \;llu ) depending II pon cher 'JlH
in particular UpOIl profit to be carn d. (I9'1 0 , r. 18)

S,

These, appart!ntly w rt: in~unnountable dimculti~.:. T hu,:; :l Ollr is

c11cr.;en I Thus the labour tl~l OTY of nlul!! In a s 11 '.,; we ~nn(\ analyse
t' . n:tturc of the answer which D bb provides for hi: own ucstion.

For it is

1'1/

the r.'cr:: pnsi1l" of the qucstirJ1l that thi' 'u1Ido" :enlal I'I'ror is

~.n:ilft'd. Wio:.I\ good reJson did L<:nin on on' l)c(';1~ion ~re k of 'the
~.c.Jlc d "labour" theory of "alue', (JntroJu tiC)n to :'Ia'x, 193+)
rc must n:p\,;~t-:'\farx is conce:-ned with an an.!lysis of tbc so inl
rcbtions of produc ion and his work n'v r str,I~;; ou:.-idc of thc~c
.unit!l. Man's ~(ici~' elation!' under c:lpitalism appL:lr onl., thr\Jugh the
rchtions betwl,.('n 'tl-lin(;$' ( ommoJilics). Leaving ~ ~itlc t~ ~i .. p' rticlilar

1ar:' says is ;'In arl. of I.onlern

"propri:ltc to cOlf.n1o.!rc<.'-their o,.~ common qu,llity is ~h:lt 'hey arc
rrodl1cts of ab,-trae: labour, t e (1'_ mtitntivc ml;:l~lI!'t: of .\ hi<.h is lill/t!.
In o~her words, the catc<"ory 'v'luc' is onc entirely slIborc.':lJt.,. in both
'ngiC11 and h stor;cal "-':11 C, to the commodil)., Dol J would 11;"...:

properties :IS use ....a!'.l.eS-\\ hieh

::, ).Inrx 'cho:-:e' 12bour- -:\ s bj 'cti\'(! act bec:m..:c it ..:: ,l'd him to
\'C c'rt..1in 'practkal' fll'oukms. 'The :t!llClll~ 'It \\ hi('~~ th
labU\lr
" co y implied' w.: arc told '\\3S that the l:,l'h~"IS(!-\ .Ill ~ bore :t
ttltain rdation to tic ( 'rput :1JlJ u,ing up of hum m .,., '-gil nlld in
doing provi...!ed ~ term" hich gay\.! fome mC;'lIin~ to the <iiit inctioll
_t\\~(,11 a gro:;~ an-l. nt!: pro llet a let to the COIlCl.'pt of :'... ipill~, und ;\
ai' 'rion for di:;crt::;tia Lng onl! typ~ of tn 'ome frn m :lllo~~\,;r.' (Dobb,
t~40' {':. 22)
Here anum .er ~ j~sues :1rc \'ai:uJ, all of tht'm oi (T-r\:':,~ ililportanc'
f.,)~:: correct in~L'r rd::\rion of :\1:\l".:$ wor . Fir t \\'e Sc' Dohb mo 'i nS'
directly in the dirL,,-. . ion of Ril;ardo with thl! cmph,,;s he rl,lCl'~ lIpon
quc.,tions of (;:<tnb:tti'of!. ,Y<;: nee i to recall th::t .~ w .. ~ Ricard.), not
\larx, who def: \;d "he t. ::.k 'To d~tl..nnil\l' tlw laws \ hid "l'glJl1t' this
tii.tribu tion (of thL 'oci;:l proJuet bd\\l' II Il.:nt, prqiil f I '..... ,rrl'~] ;,'
the princip:ll c"e J'.. ein,,: poli-leal economy.' (Hie.r..3u, -' 33. J'. 55)'
II following Ric~rdo. l)IJ1,b j.;; pIa) ing intu the 11.1 I.: )f ;> lh. ~': l frolll
.iC:i1 tein onwa:ds, who h;.l\\: r.lh: \. :H.Tu!',cd ;:"f:lf, ')[ 'll~ ,.r' 1'1'> "alll'
~:l or)' to 'pro\'e' t: Ie e: :sen ... e
'exploit:ttinn unti ... r c". it.lli '11. But
\\. till: 'luant::..th" prnbkm-th:l
f the diHribvion of C'1' l,OLi 11
\ e:lth hl'twccn the dOl' c. whi h Lt it tlted rapit'l:lst finci t:-., 1:11': 's
_ ~1\ preoccur ;;.ion: It ..... al' I.ot, t
<:\Jrplus (wa at' I a') , t l' lllXd'
t t:ll1tlt'diatc c )ns\:.:111;"'n i inl,\'t bJt.! :lnd I1CC\;~'~'-\ i all i tit the
:1 t primitl\'e A)(:l.tie:;. ":11. e tit ... lry m<.rdy rl.'lk ccl> t e p:.rlic,tlar

or

orm, within C<.1 :--it:::', .[11, of t 11' ~ ttl!)r..: g<'nCl'n! l'l:hltion.

This! HI!\ U-: ;:0 ::r.tlth\;r m:n:er, abn 1ll1pli d in thi:, ~:11.1{> ~u()'ation-

:.1

700

Geoffrey Pi

th:lt ,r"rx's valuc tht'ory can in scm\} $ nse c empirically \ n;n

utili';.\:, lhu value thCOlY of marginal utility an "I .. ;:is. A recent and \ ,~ ... '
rr.d tc, tboo];: st: ' ~I ':>

Thc !wo-c1a,;sieal theory [This r<:f\.'~s to t he th r:ory fOrlInd a d

by jI!VO\1$ il England :lntl Walrn: , :\I ng~ :, Pareto anll other;:;
on the Cooti ( nt in the la:t qU:1rte! of th l1im t(.'('llth CClltur ,_
GP] is not only cHvorced frolll soci.li rl'al'y as whole. It is
:11:0

tlivorc .J from the practical n:ahty of evcryday lifc, The

bhour thl'ory cun be uemonstratcu \.1 lpir' ';llty, eVen if only

in the ::\cns..: that, in the last analy:i. , :III t ~ c c\cl1lcnls of the
co"t of protiLlt;tiull of a commodity ttnd to be rcJucctl to labo r,
and to labuur nlll1le, if one goe:; b:ll'k far t nough in the an al).'
(Mandl'l, 19 08 , p. 7.6)

Oohu cchocs this point \ 'h<.:n he write. : 'It :;CClIlS ckal', (ro m tl
l1Ulun' of its subjcd Jllattl.:r alld the typ , of :;tatl. mcnts \v bich i r' I;r;:d
to mnke, that an economic theory must be; quantitative in fIJI" 1 : ,
determining l'chtion or rclatiol1s whi 'h fib"'J,e in the C<JIl\ 'n
system $houtd be tnpahlc of :'<prcssi n in tern': of 'luantit'\li\'c ~'n( ie
jn the real world.' (19+, p, 11) But \\h .~tr We must :1:;1' of tho ,' \~O
hare; this standI oint, arc thc:I 'qLl1.ntil1ti\c en.ltics in the real wor~ "
If the phrase h'lS any nW:J.ning it mU5t rdcr to (' ' Iegorlc stich a 'f ri c"
'rat or profit' 'ral~ of intcrst' etc, It d t.3 \S, t .. t j:'l, with thl~ realm ri
~1)PeClmllrcs to whicb the vulgar schoul i' c;~ cl\l siycl)' confill<: '. tl
realm where reign supreme 'equality and )'lr. Bentham'.
Spccifie"lIy. we can ;):>k Dohb: h ow do you oropo:>c 0 'mcn ,ure'
quantify , :tpitnl' or 'socially necessary labour time'.7 For r"o ,
.capital, we agail'l have to repeat, \Va' a socinl relation, the m C:l:, r
production in a specific social form-coniroML-'lg the sellers of J.t
t
power as an alien, r.ocrcivc POWUl'. In th~ S1tn~ way, how may \,.,:' 1ltlate' tht.; quantity f sort-,lIy nccc:;';:lIY IJbolir time incorpor:ltcd :nt
a commodity? As we have said, this Inter i: but the Cjuant it:! i
'ql1iYaknt of Mnlx'~ nUstr.lct labour \"hi has n category annot uP. r
1Ilpiricnlly within the enpitallst sY$tcm. In any case, th t' 'ch n'
nIne of any commodity docs not depend Ipon the productivity of the
ahom in the branch of ecoIH.>tlly in which it has been I rnuuc!!d ; I
reflects the productivity of labonr on a socinl scale. In uenlin;" \ \i t
"microscopic' entities we arc forced .to con:ider phcnomcn'l of
<macIoscopic' diml!l1sion. In other words, no one (1Il'H10 lily .:lll
;\bstracled from the totality of commodity production; < S we sldi Ricardo's false method of ab txaction force t}.S erron 'OtiS' icw UpO:l
im. Society, not Mr. Mandel, can be the onl~ accountant of sociall)
l1cccs~ary labour time.
It is clear that the last few mnttCrl' we han;! briefly con!'idered nr.: '.o~
isolated questions which flow from n series of 'p3rticular' mi tak :~. r r
they all involve a di storLion of Marxism in t h general tlil'cdu)1 0 1

law of v~IUQ In Ricardo and M~I'")(

289

~itivj~m . I\fandcl, for xamplc (op. cit., P: 7 ~6) makes this c _r whe:n
,C suggests .1hflt o~e aspect o~ the 3lJrl:rlon,t)' of the M.lt"i5t yallle

r.:ulrsis Iks 111 the Jact that ?usmc.ssmcn,

~Ibelt llncom;ciou::.J~', nctually

tiC\! thLiI' products accordIng to the labour theory of value, S\, CC%)'
F.,1) takes this
,POSItIon
" WI1en 1Ie \'. ntcs:
.
"1
.\ :tr. 's v:\!ue th ory thl1!; has
:', great merit, unlike SOI~'lC oth\;r \ Jlue , h:orics [he here inddt.:ntaHy
.;tpt5 that there c.ln be fl\ ;t1 Y:l)ue theom ~ to tpat developed by Marx
Ci ,.t of hi:; ritiquc of d'l:;siC:11 1'olitic31 CCOnt my] ofcJosc com':-:"mdcncc
tbe actu31 accounting s:tcm of apitatistic business cn:.crpJ'i:;c.':
{19.j6, p. (3) Dobb l1l:Jkcs t: ~entj~lIy the 0;:1111: point, if from :l slightly
dJil'rcnl :lnglc, "hen he bt.1tcS: .\n cconOllllC law 01" tl'l1lkncy mllst
~!l!C the po~sibility of some actunl nurse of C\l:nts oecurri;\g' (1940,
:.!y), ;lud carli r 'The ultimate critcri:m [for the trade,!l.,..:y" of n
~'l ry] must be the rCCJuin:r kilt of pract icc: the Iypc of CJue~ti" 1 wh;ch
0' nquircs to ,ln~i\\cr, tlle.. 1 trpo.e of lilt! inquiry in hand' Cp. $). lIen!
h:l\'c only a thinly disgu: 'J form (,f ill':lrum.:nfalisJ/I, the n1tthod
w: ich selects its categories. not 3ccorJin; to their congrucnce with
":',orical ol1d sacinl fore :i but ~imply by virtue of thcir ability to
Sl t~itl pn:diction!> 'in the 1'1.:;1 world',n
Tt \\,;1; posjtivi~m, wc must "cmember, which falsely deci cd rh:lt the
. dy 'rl';II' s!';icllccs were tho ! lJc:lling \\ it l1 natlll':tl ph IWllle l:1: '1'1:31'
'r ~hc ~-.cn:;e that thc)' nlolle \\em! 'x ct tOflll"h to 1ll3k(" prlJict'''!1''' But
,.r n;isIH il V01\'5 the Vil'W that the fut,trI. l'Wllution lr 'Hllb can be
'p.'Jietl:J only to the c'<tent that the 1l1.ll\;ri I ;llld SQci::l1 V.'urlJ ('r'I1!;i~ts
: a s"rics (If fixed CjtJ:lJ1titil'S. Bm the 'Iltirl! method of Capital i:; h;j~('d
en rnlil'cly the opposit(; vic\\ -that 'qlJ<Illti :' ('c I_ modity' for l ':lInplc)
~ (,oll~t:ltlt ly in process of tr:llll-iform:1tion into 01 III r qllOlnt it:cs nnu
,"'iities ('money' It) conlintl~ "itll our ('. amp le:) and tlJclte\.' i ,to IH.' V
q:~ntit it!; :\nd IJII31itics (' ':11 .;Ji' in this -Iloil'); this method fllrthe r
i :'t!> th:{t far from heing ,It. omatie. stich' .1nsformatioJ)s 1)(; til' on y
'.. tier ddinitl! historical nd ~oci31 circl1mstances, \\'l1i('11 ! U5t he
(St.ibli~hcd hy :-ciencc. l\larx 1, 0 m ,de dl'H thtlt h':C:1I15C IIIL C .piwli:.t
. ;~r TIl is fundtlllt ntnlly all :11 ,'rchic onl'--thut is, C<lnnot b(~ stl l'j~ctl:d to
a riol'i, conscious regulation ("ae11 law of ~he sy,'tl'11l :It' t'l'1~ it elf n';.1
'. :imlly \\oeking average' :1~ he nlah- k:lr in clmncctinn Illtil :,e bw
f.:1 \lc. o Ci\'l~n that this is ~~(I, the pinikt.ll lily of rutlln.. l!\~ II' Ul1llo t
dealt with in the pC'l'('mptory m:lJ1ncr Dot '). nd (,lb\.:1'1I 1'I)l)IJ h;n" us
r.~F 'rc.
Tn cite hut one ca,c. ) II ,\I,t !wn. c C:l1l i\1aI'\,:'~ l. w f tilt, fallli. ': raIl.!
f prl,jit ~'J1;1bk WI ccmcrc:tl J) to pre !:ct till. flll\l!'l> our, e of ~\li\it<di,
.... lnplllCl1t ? ft!> author Cit in l)' made nil tlch '!aillls ')11 it < belm!',
fOllllul.lting thin }:1\\' of l\,;il'! I1l'Y, I.e wi,l:cd to Ita\\, att~ ntirm 0 the
(" dh'lt (n) t 'e rille of profit II.:"" the rll;uLttof ,)1' th\! l'ntire uc ,tll.lt ::Itio'l
J: sS norl (h) tllnt this "cry process \\':1$ profounl.!Jy t.:Olltl~ldicto : and
I .. t It':lJ to pcriouic Cli~cs, But Ie ncYt'i r:l-tllldl'd that the pl'u:i:;(;
.',1!1.t talttl b) ~llch cris(:\ cO'lld he PI' eli -t\;o, 1101' I,;\'cn th\.'ir lxact

t'

I
1

290

Ci offr ., ?

n1agnitlldc or tirning. A::.. brx makes clear in many place's it :

each erisi was in a sense unique, cktct'lllinc hy the \vho!c pn t rof c:lpital :lccnmulation; it was therefore obligatory to c 'amin
fisis in it concruttIH';SS and not by mcanq of sOllie silllple fort:"
Prcci:;ely brt:(lllsf' c'lpitalist soeil.l relatiolH were :llltagoni"li - ,
based upon the struggle of cla,,!'Ie', \\ hose hislorical intcn-.,t
diametrically 0pp0scd, that is gualitati\ t ly difrt:rcllt- no prcd icti
a concrde 1I.1:ml' ahout the c\olution of l'co\lomic at~gor'
p()~sihk. More prccisciy, in cOllncctino \\ ith the 1110VCIJll.' nt of th r
of profit, 1\lao.: Ill.lc\e clear {li:lt he wa'\ ~t. ting a general law oj tella..
whi~h, a" in .tll ";' St~R, inevitaL ly prO(hlcL~t 'countcr-acting' force-' ..
peration which modified it!"; functioning in importnnt n ';p ct:. T . .
indude( the .. tr(ngth and de ermination of thc \ orkin!.; cl
'we;ight' of which could in no sense be known b~ r(lrehantl in .
depended upon both objective and subje tive for e" amClngr.t '. ' i had to be I1nmb(;ret1 thl.: rule which a know] Jgc.: of this law WOll] :
withill the organ; ~H: (l working cb,,' mOH'lnent. 7 Her \ .l\.larx, \\.-, :.
'Hect, warning 'lg.1illSt th e old m 'ch:mical matcrialislI\ which t
that the world coulJlc unJc.:r~to() , I in a purdj elll temp/a/ire I :L::r
The~e distortiol\s of l\Iarx's method are douhly importlJlt I
they al~o involve, in oLlr vicw, anotht;r lhngcr. This is thl' tend.,: _ .'I
redu ce Marxism to the It!\"c:::l of 'politic.1! economy' p'\ tieularly i t .
lutt r's Hj ";trcli:w form. \ e \\ ish thercfMc briefly to review. J..
altitude to his pr 'deccs~or~ in tho;: cia sic,l school in order to
what \\l; consider to he the funclnr'1t.!ntal break \\ bich Ili work rt.: >r
with this school. Marx's stu Jit s ill th e history (If political ,'Ct)" I
pro\-ide no mere 'appendix' to Capita!; in t::v 'ry Hen 'C TIll JTlt:.S
Sur/>Ius Vallie must hc onsidLrt.:tl as tht.! final volt II Ill.! of (,api
indcl.:d Marx intcn(lcd it to bc. For conlainl'd in th ' 'I'hcoriu i
detailed c. 'umioatioJl of t e C\ ohllion of the t.ltcgoril.. '\ nlu.' ... 'surplus valuc' n reflccted in thc wor of the princip,ll Fri,!lh.~
hngJish c(:onomists. But this work shuuld not be takl'n as 'b ~: .'
in the conventional sense; it was intendcd as hngds tit one : - ~
notes to pl'O\'ide '(\ detailed critical hi~tory of the pith nnd tn. -
of Political Economy, the theory of ,urplu.' value, tlml dc'. e.
parallc.1 with it, in polcmics against predecessors, most or tht!
' n~
latcr il1ve:-.tigated scparatdy in their logical connection in th ~
scripts for Books n and HI.' (Prl!facc to 1\I:1rx, 11)57) 1\.Jar ,.i-:this work always 'critictlU. " from the vantage point that i-; r.f !
own theory (historical mnteri,\lism), just as the anatomy of the apt.! m~.
be studied from the standpoint of its higher, furth r dcvc1opllWr.:, iman. IIe is intcrei-;tccl not merely in trncing th e origin of his own i eo:
in paying his intellectual debts, as it \\ cr '. l ~or is he intcre:;tt.:,l l -'y -=
exposing the limi tations of the cb<;sical ~chC')ol of which he \\ ' ful:T
conscious. lIe aims, throughout the Theories, to probe the L n'
dictions in the writings of Smith, Ricarlio, etc., because he sel'e; in :0

I~w

of valuo In Ricardo and

291

MI-X

a 'purer', more ab_ ract ",nd therefor heightenc "p.",.'<:ion of the

cAonomic contrudictioM of the capitalist ysterr_ whkh was their
:"...t1 crrlerpinning.
It i from this standpoint that the work of Ricard,., is jt;dat:d, il\ an.
:l.n~nd f.lshion. l\lan: nc', r saw his problem a~ OLe fl)l;rcly 0:'r~,'"ting the 'disfortion .' .in Ricardo's work, nor of "'TaI~ ~!ng apit, ~l, i.n a naive manner, frc-n thl.! 'stnndpoint of to . . wC''"ing cla:ss .
nd ,:1, as anyone acquainteJ with th' 'l'lU'Olits wili ;.no\;., :\lurx \VOlS
.,t\.l) insistent upon dra\\ 'ng ::Hention to Hic;).r..io::; ';teat 'disin -edn\;s~' (obj<.;ctiyit)) as ,gainst the spccinl plead~ng or. hI thus:ha: ':11:1111 less sycophanl' 't' at bOllght advOl.;ate of .,.?-\c rulin'.! J.1sse!)'
is _.!zrx. contcmptuou;:ly d bs him. But !vI:m, :sln...--es alw:.ys th a,
i ~.' )'S sinc('re insl:,tCl1CC that the ne <is of I roJ .etio:'. ~h(JuJd be
. ( .. j aboyC the I!ctionaJ c aim: of any cI'l~S (hl!r~in i:ly he 'di;::. :~r<t.:dness' of thi lich ~nancil!r) 'oinc;ded \\lth ~he need, of th e
.'ug c.1pitnlist closs only in th:lt period when lht.: : ou:'''coi ic h::tJ
ry intLfcst in th~ furtht" (.It;wlopmcllt f the p. d'~c~in~ forces.
\i.h (he emergence of the lI,ud 'I'll workillg' b~ -, thl. ;!Hb, tit ci::.iv(! or
I toe prodLlctive forc("s, tl-i pmgr(.$sivl! illh.r~st -,.-as :.I~i,:hed and
\ti~;.ti~ic roliti al economy ";cd. That is why the p<.:,"od .. :0\1' J 1830
t~lls for political l;C'onOlny it:) 'lill:l! ll'isis'; r;ir "'"o's Goctn:lI;$ b 'COlm;
I e b:t.... is, albeit in :l confl. 'd anti Ilnsati~fo.ctory m;l\,::'cr, fur the
; :lIil I LconOl1lY of 1.:' topi:m Socinlism.
Wh.t' were the main perle.l.!" which Mar. clisc ... rns t.'l tl.c hi.-tory 0:
~r::t!,l economy IIp to it ignouk collap~c in die iirs': .t:.2rtl'c of th e
. '::'ccnth century? \\-hilc Peay 311 IH' rt'g. ,dl.(\ .$ th e fl'\~;', in rr futht..r
?! tl.c <cill1ec, r'n;nch I'h." iccracy rcprt.:~elltl) the fir_~ tr ,I,; ~cho{)l in
I:lical c~'onOnly. The! wr;tt;:':; \\ ho formed this $(' 1?Ol ~)"l~t .0 lhat
~m.l~ ()f production Were. f liysiL logical rorll1~. :IT i.i.;)g out of the
~
it1C:~ of prodncti"n an ill(,ippcndcnt of \\ill tlnd PO':tL ..... Seeing
Ti!: c in production, th", s he tIll pJOC 'I'd~ to tr,tc-: the; 0: :1e~ti()n3
A'

~t\\cen

production ;'Inti cir ui:nion. Th' wc:\k:'1I':-;~l!;:; /If Ph.,';'\OCJ";1CY

~ th~.t 'production' \\.1S .ILl sc neon 1">\('ly tlnd no~ ab"lUC!)" fo:"::.(m:-ng to QUCfill:1Y and his followers, labour <Hi tl ~ l:l.i.J. \\.1' alone!
Uc'j, I.! of V:1Juc. But thi' limited view, :l rct1"nil):\ of d\1! li'll;t~d
'c Tt.1 hed in the e\ 0 ntion of the cit,htl'Cllti (~ll~~ - french eco
:1 . y. \\,5 nunethdcss ..icchiYI; for the fllture :.naly i.:: t t:.:! '::'i it.llist
,)

cm. For th(! c()11tr.1dictions at the hC:lTl of PhsiI)A~.lC an):;<.:

~!ltially from its at~\ mpt te. c'-linin fC\lda\i"ll ircI'r' a 1:. ~ : lllm:is'. Itl; bourgeois point . r ,iew"
. :fhc ~Fealilt of r(}tio IS mU'k~ a new leap 1'01\\ ar"! ~n i. ... it :;eui
.1 Our In gl.!l1cral' 35 ',lltle ex atitv". It was from
l:~ time o:1,\ards
\ I
,. .
I
0

: p0olt1<:a economy Co uld be pI:.. d UpOI1 1\ Inllch E::n'r ~hl,.'o\"llC:.ll

~... Hut again, Marx sec~ :he material h.15i5 for tb. ",.. nee \\ !lich
~:"li 't's \ 'or!- con<;titlll\:". T he cat 'f ory 'Jb. tract lab,,":' wi.ich .~lllith
v) ;cctly sees as forming the basis of VJiu' \\';"
an ~:'7 ~~~-ic..tI1 of the

292

Trey.

economic cakgurics which were being creJt('d by the d vc\oor.

the class strHggle; for here W3S rd lccted a society "here t'.~ v_
b ond bctwe\!Jl an indh'idual and hi~ labour was in the f -~c
,iolcnt ru pture, Smith' s in d:"fcrenct! to the p articular lypl.! f
"h en con;.;idering valut- - hisrc:l l point of criticism agaill~t Ph) lOe;
i mplied th e ('xisteuct; of highly deyd oped yarkties o( COtlcr' tc; 1
n one of \\hich wus predomin:lJ1t,
But, as in the e:l.st! of Phy,iocrac)" so now with Smith: his :\c.i;;u: .....
theoretical un c1crstnnding \\'13 sevt'rdy limited and n~ccss:lri' .,. .
was a 'tr:ll1sitiolul' fignrL~ in 1':. Yl:'ry sen".;, Thi , was particularly~" i~
fact that his work continu es l e clRssificntory and dl!scriptivc em:)
of his llriti f. h jl1\:<.!ecl'ssors-a ' seen most clearly in Petty 's r~!,
Arithmetic-and the more abstract approach which wa:; to be fOll
Ricardo's \Hit itlg: :lOllh.. fifty year:> lat~r . The 1l\'\ttcr ean b~ put
way: Smith was on the one. lund concl'tlleci with a search f-n t'
ab:;tr:lct laws which woulJ accur3tely t'xpn'ss the innenno~t wo:-~: _
capitalism as a sy:tI;:m~hence th c importanc{. fot his wo rk oi .
concept of the 'hidden h.md'. Thi' side of hi~ work-wJ~ ich l\l:m:
to :lS its 'esoteric' C1cllll'nt i set:n in his famou' phrase 'It is
the benevoh:nce of the butch r the brt.:wer or the baker that \ : ~
Pill' dinner but fHlm th ei r regarJ t their o\\n intcrl'Sl'. On t' eo:' ..
hand Smith's work conta ins also j co nsi derabl e ',-oteric' clt:n. '1
is a concern not for lhL~ inmr-strllcture nf ph 'nomena, but fer'
out\, arJ m:l'l ifl.!$taLioTl '. :\IallY cxampks thi s naive 'dtl~lity' i, ~
Smith wns unaware, could be dr:ml1 from the rVeallh of iVa ' .r
clsewlll.;re. But it is seen most clearly in hi., cO!lce ption that t ja
\'alu e only holds in ;t 'rude and primitive' state f society, alHI I .t.',t .
abandoneJ once:.: 'mo(lcrn' socidy i- rl':'Ichetl. Smith wa' th us gll
of allowing immediate irnpressions of competition bct\\'c~n the 1 r.
of economy to intrude into and ultim:1tply overthrow his b". ic ~
retical starting point,
I n this rc-;pect, Ricard's work involved n significant advar. '.,.
should in any case rl;!tnember that he first took tip the study of t:
conomy as a rc,;sult of th feeling of dis: atisCtction hI! ' IH. ricllCt
the theoretical and practical answers provided by the W~, .. th
Natiolls, For Marx, his work represents n decisive attempt to l : :.
politic:11 econo.llY as an abstract scierrce dealing with the la"
~h;
governed th e workings of the capitalist system. Ricardo, in ::e
iIl~i sts that the science can no longer ' op erate with 'description' U
one h and and 'analysis' on the other. It must, starting with it_
principle- the detcrmin:1tion of value by lnbour .timc-makc all t .' () !ward appearances of th e system 'an ' werable' to it.
, .,
This advance in meth od, what Marx at one point call:; 'H.: -:
great serl,'ice to the science' can be judged by :In exarnin.ltio~ of i!
latter's Pri1lciples. This work, consists, in its third edition, of th ~::) ~
chapters; the essential theoretical matters :U'~ however giveu in th
j

or

'-

~"

1'"

of value In Ricardo and Marx

293
"

- the rest consist of elaborations or applications of pn:1ciples

.~~"ciJtcd at the start of the work. How does Ricardo proceed? lIe
~~s with a statement .of the determination of v3 l u~ by la,bocl r time
hich is much less amblguous than that to be found 10 South. In the
'.~ sections he takes up a number of questions- the rnO\'(;::lent of
: ,j,'c wages between different branch es of economy, the varying I '
J~lt1rc of capital between the different sectors, etc. Of each he asks :
- ) ,,!.:It extent do they overthrow or force the modification of .he law
( \.. Iue as already stated? We give, as an e.xample of this p ro~e dure,
' .. f'l'ening paragraph of the scction dealing with rent : 'It re -:',::.ins to
!
Closidered whether the appropriation of land, and the cor"cqucnt ,',"I
I,
t::tio!1 of rent, will occasion any variation in the rcl:'tti\'C ~'alue of
mmoditics, independently of the quantity of !:tbaur nece.,;~ar)' to f'I'
"~l1ction.' (1953, p. 67) lIe t hu s tries to 'hol d fast' to th e law 0~' yalue,
ucn'J$ Smith had concluded as we h a\'e noted, that it haG to be
piJ!y abaudoned in the face of the immediate appcnrane(:s of the
~~c rging economic system.
1ilUS it can bc said that Ricardo posed correctly the probkr:: fac ing
'Hical economy. lIence for 'Marx th e 'great theoretical satl~:..:{' tion'
't rJd by thc c::Irlier chapte rs of thc Prillciples as :lgainst the 'diffuse
. meandering' work of Smith. The who!" bourgeois economic system I '
I
based firmly upon on e Inw and all phenomena "hieh ,ci...':1cd to
,I
nl~ il't \I ith it were exam in d in its lig ht. IIcre the clu e to :hc real
'\
:"'Illing of the English ad'lgc 'l t's thc exception that prow's t .f: ru le';
~,
,
Pic.1rdo, after neatly setting forth the 13\\' of yalllc 'd.:mo -,stratcs
r
.. :n thi-: law governs even those bourgeois rclari on~ of productioi. wh ich >"
"
C":\ ' "Hiict it most deeisi,c1y.' (Marx, I97 I, p, 60)
iI!'r,:, howcycr, lVL:./s praise for Ricardo's gnat hi storical ~chie,'e
,'nt ('nds, Each advance in political (;C01101OY UlIl be seen as :! 'criti_ m' of previous writers-Smith of macantilism ; Ricardo of th e
ridtl, of Natiolls , etc. But Marx's attitude to\\ .,l J S ~ieardo ::'not be .
11 ;'is in :my way anlllogous. For each of the writers who ~ ::-~-cc c!ed
~ :. rx accepted l!tat the laws of the capitalist s ' tU11 were akin to the
'.\$ of nature , As we have seen this was ::\1an:'::, main obj..:ction ~,) their
, ~;. which he s<-'es as the source of its ultimate brcak- up.
Bu t it \\'JS an objection directly ticd in with another : a recc ,,:lition
, : empiricism donJinated the method ofla,,~ic:Jl Cconon1\', :a this
.n', ,tion the centra l role which l\ Iarx ascribed to L ocke sho~l ~ not b'
! :. tttn: ' .. , his pllilo:::ophy 'crved the basis for nIl the iJ~~i ()[ the
. ~J1t.: of s l1b~cquent English political economy.' (1 969 , p , 3~7\ , f~;l in:
, ! h all laler hourgeois economists, as with A(bm
'nmh, : .. ck of
~,!",tica l undcrstancling need cd to d isti.ngui5h the difTl:fent ft1:-:ns of
,:
Lomic relat ions remains the rule in their CO:lrse grabhinb 2~ and
:(::,('q in the empirically available matclia 1.' (1969, p. 92)
.' 11 Hicanlo 's weakne:ses ref1ect this cmrtricbm and re~ol\'e :hcmt,!S into this : that while he starts \:orrectly from the law of \'~\l e he
"

"

29"
tilt 'l1l}lt

Geoffrey f

'f

.:._ -l;:w of value In Ricardo and Marx

295

_:"I.f1omena, as in the vulgar conception, nor were they merely counter.. -cd to their source, the law of value, as in classical economy. They
~ re now grasped as lIeccssary appfara17ces, contradictory, opposite,
... _ni.fotl!tions of definite, historically determined social rela"ions of
-;(Jduction. To take one illustration of this method: at one point Marx
.",',cs of the transformation of value and price of labour power into the
',;}:11\ of wages:

This phenomenal form, which

Ir.:l 'es the actual relation

inyisible, alld illdeed shows that d:'rect opposite of that ,'elation
ll!mphasis added-GP], forms the basis of all the juridical
notions of uoth labourer and capitalist, of all the mystifications
of t e capitalist mode of produc:ion, of all its illusions as to
liberty, of all the apologetic shim of the vulgar cconomists,
(19 61 , p, 54-0 )

We must now indicate the connection between Ricardo's faulty

(Marx .calls them ' violent' at one point) and the grave
-::,)[5 which he made on all the quC':'ti.ons of poILtical economy which
'::t his work open to ready attack by Ji '; opponents, This question can'r ,: be systt'matically dealt with ; we shall merel~' indicate some im :1;~ t issues. In the first place, R;cardo failed to sec that under
- i'il:dislll, prices could ne. \\,,1" coinc iJc wlth Y:llues, but ,,"crc trans -)r;ed into 'prices of production' around \\'1 ....ic1l prices in t1lrn oscillated,
.'= 'oHEng to the fluctuations of supply and demand. 8 Bcc:IU c Ricardo
t ... J dircctly to reduce all prir'cs to \':.I!ues (and lhis is the method of
nxcdu re that writers like Dobb would ha\"e us adopt) he ended up, as
shows, with a false theory of Tn:t, a serious matter in his case as it
~~titute d the enrn..:r-stone of his :,;"gtem. Ricardo tried diTCCtly to
'!;,hc,ld the law of yaille; this forced him to deny the possibility of
.', c!:/!c rent (rent on the least fertile land) and he focused his attention
:'lsi\'cly on the movement of d1f!erential rwt ( ('nt earned on land of
'~;')'i!l~ fertility). Marx, in his critique of J<icardo, est:lblish~s the
. :bilit_, of absolute rent, by demonstrating the indirect operation of
>;~ ~ \w of \ alue , via prices of production.
H\';.rdo also consistently confused the genc!'ic cal eeory, smplus value,
WI '!I or.1: of its specific forms, pro fir . This rC$ulted from his f:mlty
.... .c.c.:ption of capital, which he sa\" only in its immediately anli lable
!'m ns 'storcd up labour'. This in tur!"'. stcllimt:d frllm his \I rong undel" .. ':ing of the relation bet\\'C'l'n the "ouree of a category (in this case
;:plu:; value) with its various forr:1~ of appearance (n'nt, interest,
o~!). ?\Iarx shows in Volume I of Cc;pital that. surplus value is creat d
'1 :!1\: s?~ere of production, in the al:~agoni,tic relations bet\\ een wage
>o'J:- ::\d capital. It is subsequently divided hetween the three classes
') be on this surplus according to definite ~'nd objecti\'c laws, but
',\"S wb:h arc only analysed at a bttr "tagc. ~ot that this procedure
~ 'ractions

:u..

j
"I

296

Geoffr ey p. ~<:

could be rc\"ersec1, by movin; from the rcalm of appearance bwj: l

ess.;:nce, as )Iarx makes clear:

The tramformation of surplus value into profit must be ckduct 1

from the transformation d the r3~e of surplus value into the
rate of prl"lfit, not ,"ice versa ..And in fact it wns rate of p rolit
which was tbe historical pl"lint of departure. Surplus vallie :11 d
ratc of surplus val ue are, relati\-ely, the invisible and unkno\\!)
essence that W:1l1t invcstig 3ting, while rnte of profit and thl'rl:iot t
the appearance of surplus value in the form of profit are r( veal
on the su:-fac:c of rhe phen omenon . (I959, PP' 42--'\-3 )
/ Because Rieardowrollgly ~dentified the category 'profit.' with : ~
more general category 'surplus value' he wrongly conclu(kd th ;l t ,:-:
rate of profit could only change: if d-:c valLIe of wage goods chang\:J -:~
other 'vvords, and using MaL"::; terms, only if the rate of surplu' \ t';,
altered, 1\Iarx reject-:d thi~ conclusion, By dividing capital into 7. I1r:, 1 ,,'
capital (that .portion, of ca?it~1i adY~1nCed in the form .of wngc:s) . r ~
cor:stanl Cfl.pli:a\ (that portlOl1 expended on raw matenals, he'1t, I, i.~
power, machinery, etc.) i\larx \yas able to arrive at his catl'gory d,,'":
'orzan ic composition of wpit:ll', the ratio of constant to variable C.1i':1.,:
'Th-i3 was plaed at the c~ nt,e of his th,;ory of capital accl1nm: .. ~i(:l
and the potenti al brl!akdown 2.Ssociated therewith. Here ind,'t'l: ','.'
a revolutionar;' dcvclop n en t. The only possible barrier to the fun!:: ("
development of the procJuu:\'e forces which RicafLlo's ,york ,.:1
allowed was associated with ngr!Cillture. Ricardo had assumed th:1t ,\ n:'
1\Ian~ scornfl:1!y tcrt11ed the 'so-called law of diminish ing retta
operated in agriculture; t~e w~.king of t~is Jaw wo~lcl ultimatdy. i':
Ricardo, force up thl! pnce ot corn whlch would 111 turn kad k J' ,
increase in wagt:s and produce a tendency for the rate of pro(j :
dec1inc- -a pro"'pect which Sf'l1t shivers c1o\-vn the spine of the millio~ ... ; ,banker. (J Hence the net:d for a 'hef\'.: class struggle' against the \.;n.
interest if this. ominous tendency were to be checked. l\Iarx W:b :lL to shoW, howen:r, that there were force' quite internal to the nC';Un111'
tion process \vhich provided potential sources of breakdown; he \\
thuS able to reject 3.11 'explan4tion,;' of capitalist crisis which n it":.
upon the im~ortation of .'outside' factors-:-in Ricard~:s ca~e hem.) :.
sphere of agnctllture whIch l\Iarx recognised was rapldly bcco!1Hn:
force increasingly subordin te to industrial capital. Marx went 0:1 :
shoW that'" iTh the 'progres...c:, of industry-' there was an illC~[)r1\l!'!'
t endency for the rate of pron:: to decline through a tendency lOr 1 .
organic composition of capi d to rise. (We shoulL1 recall, lJl)"\:c":('~'
'what was said above about the pos ibility of this tendency 11<.l!""
p:1odified in its operation.)10

But the inadequacies of classical economy were revealed. m~,

clearly and fundamentally in its analysis of the commodity. It 15 t ~~,
question which we now WiS~l ~o deal with in that it will enabk \ ! S :

Text cut off in original

29B

Her ,e, 2ccura:dy spcukin; :\Iarx was '\Hong'

2.S

be r::rnself rel'ogn: .

,\hn at ttc bcginnio;:; of this chJpter, we 32id, ;.[1 cOIn,;-:cn

?ar1~nCt~, l~lat a comn1 odity is both a tlse-\':i!ue and an exch:ll.' _
';~Ill:: [for] ' . , a com "odi.~: is a use-valu e or oc:::ct uf ltiltt:;,

AAd a ",tlue. It n1'lI1ifc-sts i:~df as thi::; two-.:olcl t::lng, th ,1t it i.;.,

'=5 scan a.:: it:) value aSCerts 2.r1 tndependcn: :orm-\'iz, t ~.c f(',f: ;
, of exchange vaillt'. It never assumes this form \'. htn i!;oi::kd ' ...
'
, ..
'
on 1y wnen
p J:IC(: d'll1 a 'va Itie or cxc h <loge rc_atlOn
Wit h anotn':,
CnJI11-.:cJity of H diffcrei1t ki .. o, 'When once We k!10\v th:5, :U\::l
I ::I mo.";e of r.;,\ptc~;~i on caes I'O harm; it sin'..?ly !"t.:-',c:s as
abbrc;iatio;l. (196 (, p. 60)
I

T:,e m06t generalised ,'alue form taken ',' COi ... nocJit:d
cou:-~c' the money form (one C(}3.t = 2). J}.1o;x see?..J, in h;'~
of the "i.'alu~ form, LrJ tr{/~e thi' genesis of this 1IW':(": fon~! from t~e ;r.:n'
strltc::ae 0.1 the culllllmd/./y ..1!;d to demonstrate Z!.; fllr:. :",r d e1.c'tOI"1:l
the f arm oj capital. 'Here howe\'er, a task is set JS, the perfo:-m:ll ..:~
""hic::" has ncyer been atte:nptc:d by bOlllgeoi~' ('conomy, t::e. tJ :
H

t racL.'1g the ge:l<~~is of thi:;: :noncy-form, of de..-dopir:J the c'\:~'rc:~

of va.ille lr.1?lied in th(; valu.:::-relai:ion of comm o~:ties, r:.)m it.:; sin.p!
almost im?erceptible outline, to the dazzling money-form_' (\!.;:!'t,.
196r, pp. ':'7- 8 )
In gent.:al, ::,Iarx ,vas once :-nore sho\ving the o!i.gin cf ;lH !-:
'appe2:-anc;::s' within the cflp: talist system and at .. he ~ne tim", r oir r-to the ba. is for their o\'cnhl'O'.", Thus he cx?lains t:1at t:1t! C0 :-;t, diction within a single co:nmodity (as a. unity of a llSe-\'a: l: l' 2nd.
valu e) are necessarily overcomc only through :he relations b;~'.;~
tWO commodities in what :\Iarx calls thc 'ac<.:i ccnta:' or 'c!P'!I:':I.U:.
form (one coat = 20 yard.:- of lirten). 'Hence t'::e elementary rd, n ..:
value of a commodity is the e.ementary form in \'i'ruch the :::0;;;= .. !
cont:l.;ned i.:1 that commod.ity, bet\ 'cen use-vuke and Yalut, h~t J ~ ..
apparent,' OIurs, 196r, p. 0')
Here are !ivo crutial pOi.i1tS. First, the catt'gory nlue Oill or.')
appear as f.::r:clumgF.-~'({I/le; the two cannot be torn :lp:Ut, as so;:nc: :ni .
they C"'..Jl w;,en they argue tbat the category 'Y~Je' could co-t inlll!, .
exist ill. socialist economy \y.,i le i-..s form of appearance, exch~:: s:.;- \.t!' .
would dis2ope:lr,u Second, Clnd connected \\ :th this poi:- _, ,.~l"
insi"G that' 'exchange-value' arises from the c:::.:egor:,' \'alut!, an.tl a'
vice versa. 'Our analysi: h3- shown that, the fcrm ned expr{.~"; \ ):\ r:
t he value of a commodity origin::!tes ill the nih ~re of "aItle, :11lt! :l
th at" ::..!ue and its magnitude originate in the mode
thelr t::'-:P:-(:s" .
as exchange-value.' (Ivlarx, I96r, p. 60) Here We hay\! seen en: ::;, t .:"
of t he different conception of :\Iarx from t he ::tter \"Ulgar .. cor:.::,
wh ich taught th:J.t exchange could be examinee qui:e indl' ~ ncil!n .....
of th e relations of production,
1\12...-x now subjects the 'elementary' form to det:J.iled eXl:-:-.ln,1:: >:.

or

- f"!t I ~ ..., '"'

r '~ ....,Iue in

Ric:lrco ;;nd Marx

;: .. cuss cs the three 'peculiarities' of the form '20 yards of linen

. (h
'1 ent ~orm
"
)' ,W1len h e examUles
'
.',I:. (rC:<itive form ) = one coat
t e equl\'a
, role of the equiva!ent. 'The first p~cu )i arity th .:.: strikes us , , , is
:~ , . ' usc-value bears the form of manift:statio~, the phenomenal
'~r.1 cf its oppo:ite, yalue .. . the second peculiarity, , , is that,concrete
~"ur becomes the ;'orm under whic:l its opposi.e, abstract human
. '1tJr, m ... nifests itself , , " a third peculiarity . . . namely th at the
~ ur of private i.ndi\'jduals takes the form of its opposite, labour
. "t(':h ,,;ocial in its form, (M:lrx, 196r, ? p. 56-8)
:-.; x'[ WI.' see how tLis accidental 0r:-:1 leads to th e: 'expanded' form
"IT with the dc\"eJo?ment of capitaL:n. This is 6\'cn bv '20 yards
':;;ll'n c_-: one coat 0: 10 Ibs of tca, or 40 Ibs of rotf(;e;, etc. This
~1 hrings out what was only i.mplicit in the a..:cidental form 'It
cme.; ph.in that it i~ not the exchange r;f cOn1!l1oditi,_s which regulates
t ::l.!~;nitude of thcir Y:llucj but, on the contrary, th .. :- is the n1agnituJe
li,:ir \':.Jue which controls thcir exch;:;r;~e proporti,ms.' (;,Tarx, 1961,
i j) But this expanded form suffers [rom gra\'c ' defecls' in that i.t
n incomplete form-:he cr ation of c\'cry new cor.~modity lcngthel1S
c'l.:in and thereby fu rnishes the m a:t.rial for <1 f:- ci' h :~pr,~ssi n of
t, 1kncc out of th t-:::c contradiction;; ,- riSl'S rhe 'g;;~\:ral' \'alue form
,,_ {'lat, 10 Ibs of tea, ;'0 Ibs of COITLC , t: C. = 20 yar.-:s of linen). This
'at- thl.: \\lay for tLe ("nergl'11 e of th l': !l.O 1Ly for.:: "hich is in fact
,~.t ', 1 "ith this general form e;cer= that gold '.o w rtrIaces th(;
. :: of our example. Thus has "-Ian: traced the s.eries of logical. 'rical transitions frc'm the c(lmmod:, . for; :l to t:le monl'Y fo"m ,
,,~ hl! is able to enci this section (the third 5..:ction of the epening
j1tlr, :'tTarx 1961) thus ; 'Thc simple comr:1odity-f J rt'l is thprefore
.:: !/r7n [emphasis adced, GP] of the r:.loney form.' The riddle of
~,~y is :;olvcd :
'\fon(y is:l crystal formed of necessiry, in the CQu;-se of exchange,
\1 hereby different p~oducts of labour 2rc v::crlcll:y equated
\\ ith onc another and thus by practi.ce CQl1\'Lrtl"J i,,:*o commodities.
Th(' historical an d r:ogressive c:xlcns:on of l"\ch:1f-g~ dt:Ydops the
"ontr,'!st latent in cor1"Jmodities, betweLn the U 5e-\':~!l.l e and the
\,,!ttC, The neccssity of giving <1n extc,'flal .::o.pre:~i0n to this
contrast for the purpose of c()mmerci -.J intcr c.) lJr~t.. urges on
..he t::;tablishment of an independent form o( \':' h e. :1nd finds
1:0 r(',;t until it is once .1Jld (or all sati5-::1ec! by ti lt: ,~3~rLntiation
of cOI1mlOd ities into commodities and il1onc~'. (. I ,,-~') I9or,
p
S~)
I

l.r y now is Marx able to unJcr"land tre my::.t~ 0 0' :he commodity
~1 \\ hi h is treated in he famous scction : 'The Fe,:':;hi,;m of Com'it:"s and the S(crd tilcreof.' He cxp ~<;.:.ns, :der l.ts in\"l~sti gation
'.1.' c!':lilcn tary form of value lind its iurthl: d,~\ ,,:!oplnent, th ,~t
. r capitalism ; (a) the equality of hunur. labour is e 'i'rcssed not as

,,
"

~1

',I

I'
l

'j

tl

this equality but in the :onn of distinctly different corn rn(),J. ; ..,
as linen and oyercoat.>; C~) the quantity of social labour tim ~ ~~ '
in each commodity is iCct expressed in a direct cotnt'3. riso. ;
but in the indirect phenomenal form of equal quantities of .. '.
relations of people ta 'e t:'e necessary appearance as n:btiol'.:' :::
things; (d) the social cha;-actcr of labour, that is, its re :!tior ~
human output, appears : :. ; something else, as the value fl.':: I "
multitude of commodities to one uni\'er~al equivalent (:do neHaving establisheJ the;t:nesis of the money form, :'IIarx t:: ' .
how this can, under cC:-":lin historical circumstanc(s. Ie.,': 10
emergence of capital. '\-:;.lue . . . suddenly prescntf it;:df 2.;.> J.:
depclHlent substance enc..:.wed with a motion of its own. , " 'r,
in process as such, capital.' Thi' transitio n is reflecreJ in the (-:.c, I: '
schema which l\Iar:-.: discu sses ; under simple commodity p :T'~l!~'
we have C-lvI-C (co:1::.moditit.s-money-commoditie') bu: t: " ' capital M-C-M (money-commoclities-money), In the fo rm ~ _ ,,'(: "
that means of circul2.tion, 3S a means of purchasing \\ hat 0 :': 'It
in the latter it is turned i n~o itl> opposite-now the owner of ti: ::.c
of production uses money to buy what he does not need to . :...his capital, the Ltriving for ;:e of production.
As we have several tim es said, the transitions involved in tl ! ~; "t' ,
mcnts from 'commodity' ,) 'money' 'were historical as well :l.i . ' '
movements. l\1arx makes ~lis clear when examining the \'arj ()'_~ .1"
forms:
It therefore follows th2.: the elementary value-form is J.! ~(j'
primitive form under \1, hich a product of labour appear"
historicCllly as a comm odity, and that the gradual transfor..
of such products into commodities, proceeds pari pasSlt wi
the development of th e .-alue-form.' (196r, p. 61)
But these developments should be not conceived of in a ml ~:
W'i'y; one can say that 'c~:pit31' is 'latent' ,Yithin rh 'com::-::A~ '
However, it is only under c rtain objectiVe:! conditions, the O.lIt . :.....
long historical processes,
this potential can be reali:iL~'- n
circulation of commodities :L"1d the existence of money in one c; .
of its functions can and has ?re-existed capitalism by many hl1:;" . ~
of years. It is quite otherwise 'with capital.

,n:lt

The historical conditior''';; of its ex,istence are by no mean.::; p

with the mere circulatio:'!. of money and commodities. Jt C:l.::
, spring to life only when the owner of the means of proJuc:..
and subsistence meets in the market with the free laboure:
selli~ his labour-powe:-, And this one. historical condition"
comprises a world's hislery. Capital, therefore, ruUlOUncC$ t:1: -'
its first appearance a new epoch in the process of social proc.r; ..;'
(Marx. 1q61, p. 170)

'

. _ . c; alue in Ricardo and Marx

,,

301

' \-;... cid l\farx spend so much time on the problem of value. 'Vc
:1
_:~ re.:al1 that this question finds much fullcr treatr:1tnt in Capital
':.:-:, ~::'dl it. docs in the Cn'tique (1859) and was re\ i<:cd no less than
"7 ';mes, wlth the help of, Engels, Kugelm2nn :md others, between
~,,~ :.:t'te:- datc and 187:2. He did so precisely because he ",ished to
~ .:.- :;;:;h -he link betwt:en the internotl structu:'e of the commodity and
"r.eif: tcned expression of the contradictions within he commodity
":- i:1 :he form of c.al'ital. Here was a c1ccisi\'e brcak with classical
'-A;nv; because this l2.tter had ignored the Yaluc fo:-m (in tum a
._ :-::10'" of its ~cccptance of <;:apitalism as a 'natu ral' mode of pro'I
I,
c:.:cn) ~[ had failed to comprehend eithcr th: nature of money or of
:J.':.<J.l~ For classical econO!ll~', money was merely a :-:1eans of o\'er: ....:.g be difficulties of barter; many of the ca rly Uto:-ian Socia11sts,
,:::::i-;~d in Theories of Surplus Value h~J IJl;tray~'d a ~iI1lilar1y nai\'e
''''.~, i,)~ when. they had proposed the abolition
money while
...:-~::::ng .::ommodity production, equivalent to :memp:.s, ommented
"f _ tv retain Catholicism \\'ithout the Pope. SUI'ibr:y, as \\'c ha"c
~ ':~..,.i'; noted, for Ricardo, capital was Dev r seen as a :oocial relation
- ..: :~cr:::~' as accumulated labour. lIeJlcc for :\ rarx ;l "resentation of
'! :e:.>J ~ature of capit:tl-not a thing but rather a' ddinite .:ocial
: :oj:;:tiOCl rebtion-inyoh'cd him in :l critique of politic<:.l economy.
!'r':e:;s ,\YC accept the lilL'\;:S between 'conlmodity'-'mo:1cy'-'capital'
" '", ~.'1c -mity of Marx's thought is immcdiatdy ruptu:-ed and a fatal
"(. - :.,n:.::k against historical m:lterialism. \\'c mu!'t rep",at : Marx did
. _ :.: 11 H'erdy to demomtrate the cxploitalion of the ' I'o:-king class-it
.. ,_ ssd that this is implicit in Ricardo and cl:rtain:,;" brought out
....:": Ric"rciian !.'ocialists long before Marx rnbar;:ed upon his
0', -mc ;.tuJics. Nor did :\THrx wish only to show that thi. eyploitatioll i
.".:.: c;Jw:ic to the system. 'What he had to establish was the manner in
n::h the tendency to develop the productive forces ,ame into inea<..1.g collision with the social relations cf production. ] n other I ~
J:-':':. he had to show the rdation between the contradictions of the I
.Il.:'.Cl.:""~ I::::ion process and the social relations (If p~oduc:ion, the basic :
-:,;:~-:;,.o io:l of which was to be sought in t hl. ;lIt:! y~is of :hc rehtions !
!\\-.~:! commodities. It was central to M:arx's nld!1I.lU ~ J trace inner,
.' .: ..-clo:::ed contradictions to their fullest ~~iT~<."" i'_tn. S :"'lking of the '
t;-~ c:-(;;."Sing division of labour under capitali.m he 110tCS, ' . . the,
: . -:-: _1 development of the antagonisms, imm anent in a giyen form ,
. ~ .: :uC'..ion, is the only way in which that forl11 r)f Fc.dllction ,m '
- o.:.oo~\d and a ncw fo:-m established.' (I9 59, p. ;-:is)
-:>,_-::lc.illy: we do not accept t:mt there is a Sepal~ t: :'::ll'xist 'theory
, ~:!. ::ab: crisis' if this is taken to mean that thl! all:!;ysis vf capitalism's
,:"':,iic-.i')ns can in :1Oy way be considered ap:trt fro::1 the results
- .:.."'! contradictions as revealed in the proc~ 5s of capi:.3.l aCC\1n1ula.. - .ct ::.his important re:pcct, we must state that Oil .. ': more what
-::1 ~ "
lied the 'Dobb school of political ~(:()nomy' G considerably
"

or

l-J3dequate, ~ot only do t:-. cse \\;iters f:u1 entirely to deal y:',
cc;estion of tr,c form of VULc, l3 b'.!t we actually find Dobb :'.. :, ~
~".:pporting those cl assical v:cws wl-Jch :\Iarx \Va at pai ns ',., 1"",
Thus he \\T r:cs, speaking of clU$sical economy, 'money c
:-.t':rlecreu in t dC determin;Hion of exchange values, so for t . .::
: :-'!''lon could :he "amount o~ emaud" be regulated ac; a fa~t c' :
;:-jning thc proccsst.:s of pro,:::.::tion and exchange'. (ICHo, pp. I:-~J
Equ111y saious is the tn '1."::::lcr i!1 which thi, samc group of =;'.'
b~ pb:cd a :lgill line betw~C'n th eir exposition of ' crisis thc. ;,,;,,' ...
'','2, ut! theory' , Becau&e of this., they m ust tend in the direction ,~f
v::..riant of K Yj1t.si,lIli:;Jn, T h!i:. latttr theory starts from the co:' c(:;..
oi 'eS'ective d ,:T,;1.. .1J' (borro\'. ed in its essentials from Maltlm;;) u '_,
i:-: isohtion frorrl the stt'uct'-!rt: of production. Sweezy's latc.> .
(3aran and S" t:t'zy, I966) is :!lmost purely Keynesian in form.' l ~"o.;
s:"''':'!;larly acct:p:s this divisior:. between what jg conventional!: '\~t ~"
a:; the 'micro' ,b against the ' r:-tacro' problem whcn he attemprs 3: C..
point to exph>.in the relative lack of any creative work in the : '", ,
y 22ue theory in terms of th\;' fact -hat the ?ttention of l\bru" :.
n""",,~~:1I ily b.:'.:u turned on to other, 'theoretical problems t 'c. , .
p=- )bL;:n of tht: "breakdown" of capitalism) which are of mor" . ' I: !
ar:d ilmnedi3te relevance to the policy of the working cla's mOw- ...... 1.

.i ..

(}. ic-ek, 195 6, PF" :.!o2- 3)

,\.t Ont: blow, the uni iY of :\Inrx's conception is broken 3:1..1 .... .
cO:lce::sions to yu.lgar econom\" art: made, For here we sec not ;:- .:-r;1
a :-::o\'e !n the c:Jt'ction of Ke~'nes, There is also a L'lcit admi$,,:I):! :,._.
w -"'lteYe!.' the sLcngth" or ' :"I.i:,;-x;"t politic~>l economy' (and f~o:,. <
ar5":.!roent of this p aper, it should be clear that this i a c:1tcgcr:- t! ~t
ca~.not b accepted) vulgar economy may be better able to ., .. :: '
nli .:~oscopic, sho~'H'un phl:no:nena, This indeed has long b\. .... ,! ':'
ex?~icit stamlpo!nt of :1 trend amongst :\Iarxist commentat ~' :
p':2c ip:tlly by the late Oscar Lange. On.ce more the implic.1.t;.:.~
t:h:5 p05i~.ion are not confined. to purely theoretical matters. }\,!,
im?ies that some forl11 of marrbge may b e arranged between :\13:.
an.:2ys;s and neo-cla sical 'price tht:ory' (hO\v there can hi.: '1 i .
thC"J')' Ul the absence of a value theory is never explained) ir: ~ c
so,','i.ng of 'eco nomic problems' in all 'indu strial societies' \\'h: h '~
inc:-c:us.ingly broL:.sht together by the imperati \"es of planning ;~nd ...: - ,
rC'T,_:atio:l of economic :illair ,i5 Such ideas are only variants :-" ~~ ...
sp~:ious so ciological 'convergence' theory, a theory owing e\'ery~}':' '" t
l\h.;: "\,\'cber and nothing to Ka:l Marx.
'Tb.e logic of many of the va.-ious positions we have analyse.l in. ~r:c:
COl.::se of this F.lper has demonstrated the crucial importancx
:..
cor.ect understanding of Marx's value theory and the impljc.lt~ 1:;$ ,of
all\' distortions ~ 'hich lead it, via empiricism in the direction of Rl~ _ .
th;: is back to political econom:;. But it is ~ot enough !nerdy tl)
,
tha: :\Iarxism cannot be reduced to some fonn of sociological 'r:' n

.... d value in R1Clrdo and Marx

303

"~I",

,Ve rollst go on to establish, against some increasingly

that the completion of :',Ian..'s critique of political
~ '1\' and his writing of Capital would have been impossible
: ',,:t' the profoundest grasp of the Hegelian dialt'ctic. We hope that
. ,dler occasion this p,roblem can be considered in much greater
" ,han has here been possible.

-..;. ,~' .;\\t.: ideas,

!::cs
'('x anJ for all may I state, that by classic.>l PnlitiC<11 Economy I
. ;.~and lh:!t economy which ~ince the time of \V. Petty, has in\'t:~'tJga ted
"J f~!ations of production in uOlu'geois S(lCidy, in contradistinction to
.1 ~cnnomy which deals with appe~lram:es only. , . confmes itself to
1 <c"'!!':sin,t! in a pedantic way ;md pl'(;,senting fr,. t'\'(~-lastillg truth, ,he
, iJus held by the sclf-compln.c"nt bourgeoi~ic \\ .i th rLgnrd to their own
,' !J :ht!m the best of all possible worlds, .. .' (:\foll',\", J96r, p. Sr ) It
1 Lt puinted out that it is not only those writull; OlS :\1arxists who
. ' 5<: l~icardo with ::\Jnx. Thus Schumpctcr ,ells u;, thnt 'His [:'\hn:~'s]
~ (;r ',,1Iut.. is a Ricardian one' :md of our~c 'E\''-'t:'-ody kno\vs that
, .' c:.\,.ny is unsatis[pctory'. (1959, pp. 23-4) A more l'c'.:cnt writer is
J~' I'-Tical \\'h,~n he sp<..a!;.s of 'thc labour th~)ry of \-aluc which :\IaTx
l\tr (rum Adarll Smith and Ri 'ardo'. (Gi..:!J,'ns, II)7!, p. 46)
" '. , . ),1. Proudhon, mainly because hc 1" .s tltl: historic;ll kno "ledge,
~ rcrcLiYed that as mcn dcvelop tbl:r pro2uctiYC facuities, tbat is, as
'c. they develop certain relations with 01',\' :lllO her :Jlld that thc nature
~c rdutions ml.;st necessarily ch;mge \\'ith tl:e ella 'bC anu gro\ '1h of
,.,~a (ti'.. e facultie~, He has not perceiYcd (lat erO.'iomjc I'Ofegorics are
:1 \! al'stml;t f),JJ1'essions of these actual rebtin! .s and I1ly lCI11ain n'ue
:f. ~~ Ic.lations c:xist. He therefore falls into th\' <.lTl)r of the bourgeois
~.11't$ who regard these econon,ic c:!teg(\n~~ no, eternal anclnot as
.' '.,: hws for a p3:licular historical deyelopr:lt;m, a do;.:wlopmem d;;:terr ' ';) the pJOductive forces.' (Marx &; Engd<, 1956, p, 45)
'j;, '(:;;l<rk by Engels has occasioned consi derable controversy md we
""! :I.! ["c! obliged ~o comment upon some ?<tJ"et~ (\~ it, Lngels, in the
n in .ll1ti-Diilzrilig from which it is t,(li:en, c1C<lrly wishes to strtss
",hrr\':\S the diSt~bl.lti()n of social labour t:l:':(;~ pLh~e i1ldirraiy withi n
ium. th:tt is through the exc1l:tnge of com::'co,liti...s. under soei::tli"m
'",::ihll ~ion will be sLhievcd directly, in t h~t ~(,l1S" '",irnply'. lIence
si,ould no! be;; taken to mean that cconmnlC pl::lr:r.in{~ Wl)tlld r<::prcsLnt
r lk1!1S, Sllciatist Lconomy would, for inst ':CI', , ".1 to (lrl',:mg~ that
'tt' :tion of its om"put was used to 111:"intain anJ l' ~ ten d the means of
t ( n. But this 'O\'crprodllction' of he nll'~n!> ,,1' ['~odtlction would
l/. ~ );11' quite oPP'Jsitc to that under cnpita 1:<m 'This sort of O\'el' '. ,: '11 i, tantamount to control by f>ociety C" '<" 1' ilk materi::t1 m C.itlS of
11 r<:;)roductiol1. HuLunder cap-italist socid,' it ;'s ,. H clclI1l!nt of Ill;a,.c/ry!'
, . ),):7, p. 469) Thus wc l'al11Jot mechanic'.lly t ',c,; te the I'cpro <.:!uction
.-- .. - nf the ~ccond volun1c of Cnpittli intl') the ttna!~ .. ;~ :1 S()Ci~l)ist !:; 1Icicty.
oj;,. 1"Iorc suhst:m\ial point concerning tre di":1!" ,1nncc of til" bw
I, under ~()cialism. It was of course Joscrh 51::1!:: who tcnnjn .. t~d the
~! '11 which had long continuer.! in the CSSR \l'i h his edict that the
:~
diJ indeed continuc to operatc withi ll SO\:<:1 ee.)J1om,-. :!lbci t
': 1. l'lCeI' form, This pronOUtlCClncllt: still CO!'Hinlw5 to fnnn the b<:sis for
-I S.)yjct tbinkin,q in this area . Stalin's stat.::rl'nt tbn:w writers like

: !ue

304

Gcoifrc) ,

i\Ie(;k into cor.s:dnable difficlIltic:. 1t 'wns clcady in couflict with ::'lJ.rx'.

explicit slatcm:.,nts that the bw c:- Y:llue was n reflection of econoI':'l.c for
opcrutinz Oil', uncleI' commodity ?~oduction, and would di~aPJle r with
socialism- '\\'h;ch involved the cE::1ination of such fom1s of prodl:c!ion.
On the other h:md Stalin had als" Nonounced tlut the USSR "':15 ),. t ..
193 0 $, alr<'aJy 'socialist'. The re:!: ~hcoreticOlI point is thi~: we ha\;
distinguish, as :\Jarx does in his ,;;-:rer, bet\'\een 'economic laws' a.r.d 'I~ ll""
Jaws'. Cnc1er c3pit',list commc,dit:; producti n, and under thh fOIIn 01
protiLlctioll aim!!!, tIll: need to dL tr .blltc bbolll' in ddJnitc propo,t: ):1< ( ~,...,
the form of the cr<'Jtion of Hill/c.s. In other w01'd~, the labour proc ~s C~!!l
take! place only tnmugh the ' :'I h.lc c:-cating process.
As we ha';e already impl ied, Er.;;:ds' tatcnJenl CUll be supported by 11' :.y
drawn from). hrx's own writings. In hi;) Critique oj tlte Gotha ['ro 'r,Wrn:'
(l'.TUfX & EII.,,"i5, 196z, pp. 22-3) ::.<." state;): 'Within o-op<!ra~ive ',kil;Y
bns<ld upon tilt, common oIYncl'shi? of th<l means of prouuc-rion, ~<! pw,; ~
do not e;xch~llg" their pn)dt:cts. Jw.t as tittle ducs the labour employJ O!l
the plOllucts ::!ppt:ar here as the 'i:C ':liJ of these products, as a material '1,dJp0ss cS eu by them, since now, in contrast to capitali$t society, ill,li;i,iu .ll
labo1.1l' no lon f<lr exists in an indirel. f3shion but directly as a com! ')11 'm
part of the tOt~:! h bour. ' It is also snell forgotten by those who wish to
countcrpose Engels' 'wrong' forrm..la.tions to the 'correct' statcm..::n:; maJ.:
by lVlnrx thnt the \\ hvle of AlIti-D:::hJ'illg was read by Engels to 1\ lan,
partly writtt'n by the latter and P' tjlished with hi full lmowlcdgc. (En"d
19 6z, p. q)
4 . It m:gl.t seem that there is a p.l;,;,dox here. For on the one hand RI\; t !,
defined the SlIcj.,ct mnttl'r oE policc.o l economy as one COJlcernl'd rr-jn1Jnl~
with thp questions of distribution. 1t W:lS this emphasis upon clistl'ibu:t OI1
,\'hich implici 1: exposed the contr:.clictions bctween the Ja5Ses; th.!~ wir c
for i\Ja\")(, Ricar"':o rcmained 'that ~:o:;t stuical opponent of the \\'o~,,inr.
c!n"g' for others, likc the American Carey ('iVIr. Ricardo's system is one oj
disconh;') he W~,$ dCllonoced as t h~ f:1tltl r of eOll11nunism'. Yet i\1::rx :n.m:
times also SC{'s Hicflrdo HS the eeor. 'Tlist )[ productioll, par excel/en.:.'. Hu'
as he explains (:\Iarx, li)7 1 , pp. 2ev-I) t11i.) apparent contradiction ')nly
arOse hecause Ricardo had 'instin..:.....;.dy treated the forms of distri;;)Uti(Hl ,
thc most precise expressiun in whi.:~ the hctors of production roa nif' t
themselves in :l given society'. Yet Debb's cmpha is, when dealinr; "ith
l\larx's value th':'ory is wrongly pl- ~d on distribution. Equally mis,;tk t':t 11
1\ fc:ek ",hCll ht:: 5ays : c fill econo:n.ists, whether c13ssical, l\brxim or
modern, ha\"e been largely cnncerno-d with the laws go\'erning the (ESlribu~
of the national cnke bctw-:en the 11'...:.:n social classes.' (1955, p. 232) For
l\laf)l:, this was positively 1Jot his 'rr :,.j.n concern'. "'hot he <.lid show ".IS
that rdations of tlistribution ancl cxc.hange cannot be understood 'in .
thcmseh-es ' but only as a reflection of dt:finite social relatioll.S of pro,;'lIctlOrt.
It almost gOl'S without saying that \"Ulgar economy treats 'production' (!n,~
'distribution' as discrete sectors. It was John Stuart ?-.Iill who mado! of thl:>
distinction a ,j rhlc; for him the l!l\'.s of (capitalist) production were
.. ,
i.rn.mutablc while the laws of distrib.lti n might be capable of some modIlH';Jtion in their oper,1tion. TI is trite iCt':l l'l.ter formed the basis for Fahirm
economics.
.
5. \Ve can see how clos<l Dobb, r.L:...,del and others are to the mot ntlf::.I!
pragmatism Whdl we read in :.\lilto') Fricdman--amongst the most
promi.ncnt apolo:;ists of instrllmen:..lism-' .. , the only rclevant tL'S: f the
validity of a hypothesis is compar!' - n of its predictions with c. perienc'::
(1953, pp. 8-9) and speaking of the '3dequacy' of hypotheses he say.s '\\!l,,:,:C:
they are sufficiently good approxlrr_.rions for the purpose in hand [IS a

t;

..... of \"atue In Ricarc::> and Marx

305

,',,., we can only 2.C.swer by] seeing whether the theory works.' (I953,
:;'~:o r Marx, in opposition to this concepti0n, his C<.tt!gories were not
,to.' :1' :!ccording to prngm.atic criteria, but weIt! lusto:-ical and social in
~;cr. Thus the caregory 'labour power' (the ability to work) ,,,as not
.~ ";1" 'seJected'; it ,vas a commodity brought into being by the process
, ... '~~n.tggJc, in t he :Jlanner described by l\1arA: ill ~he sections of Capital
. \Iith the forcibk sep2.r:1tion of the English pe<l!';.:..!ltry from its 1311d
~
I:. t;ansfonnation eto a' da~s of wage labourers .
'Tl ~ \'ulgur cconolrist has not the faintest idta (1\;" che ;!clual e\'eryday
"".b: ,;~ relutions can t:ot be directly idelltica[ v;ith the! :nagnitudc of yalue,
:.t' t""nCC ,)f bourgecis society consists preci5cly in ~:.:s, that a pn'ori there
" ("'(':l;cious social r<!-,;ularion of production. The rU:i'>llal and necessary
.. ~ ~s i:sdf only as a b!.indly working 3.\'eragc, And tr ;-n the yulg-,.r
( "\ 'n.: t think. he h:u made a great disco\'ery ,,'hen. :!.S against the rcveht't": tb: interconnecton, he proudly claims th:1t in :,.?pearance things
'. i:l'cren t. In fact. be b ,,:::s ts that he holds fa,t to a??,::uan("(;~', and takes
. ,': :',c ultimate. \\ h:, th en, haye any science at all?' p.1arx, 1931, p, 74)
...... \{..n:, 1959, Chs, 13- 15,
.. t'o : :hc 'transforrna7ion problem' aJ1d its ' solution.' se i\1;trx, 1959,

... f5:-7 0 .
H,,'.. in~ Jcfined the :-ate of profit as uniquely d,:tcrm.incd by the fate of
"":':~ \'.lluc to variau:e cap;~1 (1" = s: \"), RicarJ') c,', dlned his disCllSsiof'
.'...:. ~cS in the rate 0: profit to a d ehctte about ch:l. ~", in th 'l.alue of
, ~ ('l) \\ cr. Having o!ccepted the infamol1s 'p ~in cir k of population' as
'l':I~:,d by 1\ [althus, which by prv no wlcing the ,"J:,?iy of labour
!',c:y da~tic 35~Um(::s wa::;:;;:s const;:;" at slIbsi,;te!ICI ''\'cl, Ric;lrJo
, .~d 10 limit the c.::batc about the 'l-uluc of hlbc,~: power to the
-j ':1 of the produc:.!\,ity of agricuimrlll !nLour, 11.< :, elil!\'ed'-al~ o
~'n;! th;:: 'law' of ci:nini5hing tdurns-that agri(. ':ural productivity
.JJ decline over tim:: and thus, by [orcin .. up "a, . bring- aboLll a
" .<1i ~ ill profi t~. H ence his d il:tLun: 'the intut';;t ,': ;:h e landlord is al\\'~ys
. "".lion to th;1t (:~ e\'cry cl:lsS in the commUllity'.
'n::: bdsi.: idea ru:u as follows i as C;:i?it.al ;ict.\urllL.:.: , there is a
: _:' for the cOI1:;tJ.nt eh::m.nt (c) within tht: total c<'j)ilal to in~re,sc as
. '.: ' lJtc than the \'S'iuble 1-'ortioll (\,), The o:gani<: compositi\\u of capital
;.r" r tic CJf const3l1t c~pit a to vnriabJe apital (c: \'). Tf the rate of profit
~~l.:.::n(cd by the re'!ationship of l'i;f:-plus val ue (s; t ' tOlal capital
\}, then, if the ra:::io C:\' is rising, Ihc ratio s : (c - \) must tend to
'r on the aSSW1)p::i0!'1. that there is no incre;,->e in ti-.e rate of <!y.ploitation,
\. Hussain (197:, ?P, 35-<)) takes this p o~i,ion in ::ttl'mpting to show
~ L: zcl!; wa<; wrong :n the st,li.cOlent we quoted fro~... /iuti-Dfilirilig
r. i.i,' ~tlggcsts , sp.:.;ifi cU}", that EngeJ~ ,vas ~ltilt:. ()f conflis ing " ':llue'
: ;:5 i,hcnomC'na l k:;11 '('xchangc-\,luUC' . \Ye L:\\ I: .' tread.)' argued that
,~: :\ CH:ccssary ca~,nection be1ween ''':111..1'''' Ilnd ;ts ~1odc of "PI'<c, ran<:e,
' . h rx shows is a n....I1"iu tl of the nature of the ,'.,:1J1lQUit\' its ... lf .
t-: in~istellce or: the r -imacy f the cnm' J1( , 1-: ;?,; agai l~t .. :1Y
cpt of val\lC', Second h o" ever, how do',s H1I55~1r. r(;cUlh.ik l'is pnsi ri011
?: "'X '~ imistcnce <hat t 1)e law of \'111u(' of nect ".. j,\. can only tJ!,,,rat~
:.;- UlliJ1.moc'o , bJin.:i. way; 1t is from this unc .:rs t<ln~:nlZ that ::.rux ecs
..! :.le' ;1:1d 'price' :'lU;r Jiwq"c, a di\'crgcr.cc d~:r'.'ndeu by 11 ,.: ,"cry
.: c' luc ltsdf, 1'\0.. ~f we a..:ccpt th :lt "oe;:;l.is-n ill \.. :"cs not tlv blind,
~.; r: ~',nsri(,,(s rcgu!;:'~i()n \.if production (that i~, ~oci.":';~111 il1\ol\'l's the
.1., ; n of w(:alth, 0: usc ...."Iues, not the pro." uctio'1 ,)f '\':,!UI'S ') then
~... ,.,f v,tlue Cl.aSe5 lO h old in such ~ mode 0: prod1..:ction ,
-,

306
12. 'Tht! gentry the economists hay.:' hitherto overlooked the CXb~7.eiJ
simple puint that th e form 20 yarJs of linen equal one coat is on:: :~f:
underde .... dopl,d b asis of 20 yards of linen equals 2 and that th('7 e:~;-i.:
silllplest/orm of cOll/lllodify, in which its value is not yet expreSSt'C -.:.., 2rdation to all other commoditi ..s but only as something difjrfl':lI t i ,'_ ' i- _
tht;; commodity in its nahLral form. cOlllaiJl .~ the f~11.) le secret of liz.: .' ,._,
form null with It, in embryo, of all bOllrgcoi~ f('lnn' of the produr' ,;: "
(, Iarx, 1956, p. 2:lS)
13. A notabk ,'xccption is Bl,\kc, 1')39
l,~. In this wurk (Haran and Swce,, :.-, 1966) we find virtually no -c:.re.l
the theory oJf \allle in a stud,' which purports to deal with the str ,'::.'-1;_
dyn".ITlics (If capitalism. Inst<'1d modern oligopoly 'price th.:ory' i: " '-:~r
wltltout qll<.! ... ti .. n :mel an alI ,'>st purely Keync~i:tn, undcrconsulll ?::::>:1;~
view of economic crisis clabonted . \Vith the benefit of hindsight :: ~$"
possible to disc~rn many of th.: ,o;,-,ds of thi1l p05ition in Sweezy',; c '.:: and still popubr work (Swee7.Y, T946) wh"re Again a nc~r-Keyn t:' ':"--:', ' . .
of tIlt! fWI"tioiling of capitalism i~ presented and no link what~oe ' t;
established between the exposition of value theory ,1I1d the rest 0: >be
analysis.
15. A drcac\e aftl'r t c publication of his stlldy of value theory w:- ' . h -,
paper has cliticis(;(\ (i\ r~'ek , T956) :'\Ieck had moved to precisdy t:"':;. r '-'-_'!l.
In a later worle (:\kck, 1967) he hat! construcled extremely firm, -:cil:.:!
toward" the \ uJ ~ar school. For now he was arglling for a rccolll.i;';;:::c:-:
betwcen :\IHr'(i~m anel wh"t no df)Ubt he would rarlier have c'lllt:': ' co' " :t

. ,

t:conOlnlCS .

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"ently Pub l ished Books

: v;n Routledge & Kegan Pau l
b;!doo and Bosto n

.--

--_ ..----.-----

The l'1arket in a Socialist Economy

','LODZIMIFRZ BRUS formerly University of Warsaw. PrOrtlSsor Brus ,,,:is one o f
c rlrst C.lSte-1'n Europ(!:n ccono,.nlsts to :ldvoc3te the type of (conc,mic reform
tl.l1ed in this book. He show. hoY( a sOClztist economy rqt:ires :l m(!rket to
~ . ~,r it to oper:lte efficlently. He surveys rho'! histcry of the problem , discusses
t I. w of value in a socialist 'conon'y, and pl'lw! nts a mocel of the pl3nJ1ed
w~n, . ..,y with a built-in market mech2nism .
2 SO
t

Economy and Society in Early t-<1odcrn Europe

t :"t; (rom 'Annales'
EJ1TED BY PETER BURI([! Lecturer in History, Utliversity of Sussex. Annales, the
~~':lrlea l lournal founded by Lucien Filbvre ~ '1d Marc 810.:h, became under their

d.~or~hl" one ofthe most Influential in the world. The sr lect iols in this volum.:!

roner-roed with the debate on the price revolution of the sixteenth century
'Annales school ' a pproach.
2 25

~(j ~II reflect the

Historism
Tr: Rise cf a New HistcrriciJl Outlook
fRIEDRICH MEINECKE Foreword by Sir I-aiah Berlin. A m~lor co",ribution to the
l(~dy of th" history of ideas. l'1eineckc uses the term 'llstoris-' to d'lnote the
i:,1 in,portJrrce or inT<:licctual history in the study of the- dr-velc~mcnt or nations
.nd ('Jltures and traces its origins from the eighteenth century through to its
;-Clt t exponents, ~1cscr, Herder <lnd Goethe.
.6

The Origin and Diversification of Language

:'O~RiS SWADESH E.dited by Joel F. Silerzer, with {111lntroduction b..- Dell H. Hymes.

!1'<! Ia~t major work frerr ono of this cemury's forem os t scienti;,;: inve-stigJtors of
'l~tuJl:e. He dlscu~scs the simple qualit ies of human speech pre,,' nt in animJI

hl~u3gCS :lnd establis",,~ distinctively human techniques of eYpl'I.:ssion by com

,UIO Gthe comn'lon features round In modern and ancient languJges,
375
,

'