III. Chapter on Capital - Section 1: Production process of Capital

• • Introduction
  • II. Chapter on Money
  • III. Chapter on Capital - Section 1: Production process of Capital
  • III. Chapter on Capital - Section 2: Circulation process of Capital
  • III. Chapter on Capital - Section 3: Capital as Fructiferous. Transformation of Surplus Value into Profit
  • Addenda to the Chapters on Money and on Capital

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III. Chapter on Capital

Continuation of Notebook II

‘From the beginnings of civilization, men have fixed the exchange value of the products of their labour not by comparison with the products offered in exchange, but by comparison with a product they preferred.’ (Ganilh, 13,9.)

Simple exchange. Relations between exchangers. Harmonies of equality, freedom, etc. (Bastiat, Proudhon)

The special difficulty in grasping money in its fully developed character as money – a difficulty which political economy attempts to evade by forgetting now one, now another aspect, and by appealing to one aspect when confronted with another – is that a social relation, a definite relation between individuals, here appears as a metal, a stone, as a purely physical, external thing which can be found, as such, in nature, and which is indistinguishable in form from its natural existence. Gold and silver, in and of themselves, are not money. Nature does not produce money, any more than it produces a rate of exchange or a banker. In Peru and Mexico gold and silver did not serve as money, although it does appear here as jewellery, and there is a developed system of production. To be money is not a natural attribute of gold and silver, and is therefore quite unknown to the physicist, chemist etc. as such. But money is directly gold and silver. Regarded as a measure, money still predominates in its formal quality; even more so as coin, where this appears externally on its face impression; but in its third aspect, i.e. in its perfection, where to be measure and coinage appear as functions of money alone, there all formal character has vanished, or directly coincides with its metallic existence. It is not at all apparent on its face that its character of being money is merely the result of social processes; it is money. This is all the more difficult since its immediate use value for the living individual stands in no relation whatever to this role, and because, in general, the memory of use value, distinct from exchange value, has become entirely extinguished in this incarnation of pure exchange value. Thus the fundamental contradiction contained in exchange value, and in the social mode of production corresponding to it, here emerges in all its purity. We have already criticized the attempts made to overcome this contradiction by depriving money of its metallic form, by positing it outwardly, as well, as something posited by society, as the expression of a social relation, whose ultimate form would be that of labour-money. It must by now have become entirely clear that this is a piece of foolishness as long as exchange value is retained as the basis, and that, moreover, the illusion that metallic money allegedly falsifies exchange arises out of total ignorance of its nature. It is equally clear, on the other side, that to the degree to which opposition against the ruling relations of production grows, and these latter themselves push ever more forcibly to cast off their old skin – to that degree, polemics are directed against metallic money or money in general, as the most striking, most contradictory and hardest phenomenon which is presented by the system in a palpable form. One or another kind of artful tinkering with money is then supposed to overcome the contradictions of which money is merely the perceptible appearance. Equally clear that some revolutionary operations can be performed with money, in so far as an attack on it seems to leave everything else as it was, and only to rectify it. Then one strikes a blow at the sack, intending the donkey. However, as long as the donkey does not feel the blows on the sack, one hits in fact only the sack and not the donkey. As soon as he feels it, one strikes the donkey and not the sack. As long as these operations are directed against money as such, they are merely an attack on consequences whose causes remain unaffected; i.e. disturbance of the productive process, whose solid basis then also has the power, by means of a more or less violent reaction, to define and to dominate these as mere passing disturbances.

On the other hand, it is in the character of the money relation – as far as it is developed in its purity to this point, and without regard to more highly developed relations of production – that all inherent contradictions of bourgeois society appear extinguished in money relations as conceived in a simple form; and bourgeois democracy even more than the bourgeois economists takes refuge in this aspect (the latter are at least consistent enough to regress to even simpler aspects of exchange value and exchange) in order to construct apologetics for the existing economic relations. Indeed, in so far as the commodity or labour is conceived of only as exchange value, and the relation in which the various commodities are brought into connection with one another is conceived as the exchange of these exchange values with one another, as their equation, then the individuals, the subjects between whom this process goes on, are simply and only conceived of as exchangers. As far as the formal character is concerned, there is absolutely no distinction between them, and this is the economic character, the aspect in which they stand towards one another in the exchange relation; it is the indicator of their social function or social relation towards one another. Each of the subjects is an exchanger; i.e. each has the same social relation towards the other that the other has towards him. As subjects of exchange, their relation is therefore that of equality. It is impossible to find any trace of distinction, not to speak of contradiction, between them; not even a difference. Furthermore, the commodities which they exchange are, as exchange values, equivalent, or at least count as such (the most that could happen would be a subjective error in the reciprocal appraisal of values, and if one individual, say, cheated the other, this would happen not because of the nature of the social function in which they confront one another, for this is the same, in this they are equal; but only because of natural cleverness, persuasiveness etc., in short only the purely individual superiority of one individual over another. The difference would be one of natural origin, irrelevant to the nature of the relation as such, and it may be said in anticipation of further development, the difference is even lessened and robbed of its original force by competition etc.). As regards the pure form, the economic side of this relation – the content, outside this form, here still falls entirely outside economics, or is posited as a natural content distinct from the economic, a content about which it may be said that it is still entirely separated from the economic relation because it still directly coincides with it – then only three moments emerge as formally distinct: the subjects of the relation, the exchangers (posited in the same character); the objects of their exchange, exchange values, equivalents, which not only are equal but are expressly supposed to be equal, and are posited as equal; and finally the act of exchange itself, the mediation by which the subjects are posited as exchangers, equals, and their objects as equivalents, equal. The equivalents are the objectification [Vergegenständlichung] of one subject for another; i.e. they themselves are of equal worth, and assert themselves in the act of exchange as equally worthy, and at the same time as mutually indifferent. The subjects in exchange exist for one another only through these equivalents, as of equal worth, and prove themselves to be such through the exchange of the objectivity in which the one exists for the other. Since they only exist for one another in exchange in this way, as equally worthy persons, possessors of equivalent things, who thereby prove their equivalence, they are, as equals, at the same time also indifferent to one another; whatever other individual distinction there may be does not concern them; they are indifferent to all their other individual peculiarities. Now, as regards the content outside the act of exchange (an act which constitutes the positing as well as the proving of the exchange values and of the subjects as exchangers), this content, which falls outside the specifically economic form, can only be: (1) The natural particularity of the commodity being exchanged. (2) The particular natural need of the exchangers, or, both together, the different use values of the commodities being exchanged. The content of the exchange, which lies altogether outside its economic character, far from endangering the social equality of individuals, rather makes their natural difference into the basis of their social equality. If individual A had the same need as individual B, and if both had realized their labour in the same object, then no relation whatever would be present between them; considering only their production, they would not be different individuals at all. Both have the need to breathe; for both the air exists as atmosphere; this brings them into no social contact; as breathing individuals they relate to one another only as natural bodies, not as persons. Only the differences between their needs and between their production gives rise to exchange and to their social equation in exchange; these natural differences are therefore the precondition of their social equality in the act of exchange, and of this relation in general, in which they relate to one another as productive. Regarded from the standpoint of the natural difference between them, individual A exists as the owner of a use value for B, and B as owner of a use value for A. In this respect, their natural difference again puts them reciprocally into the relation of equality. In this respect, however, they are not indifferent to one another, but integrate with one another, have need of one another; so that individual B, as objectified in the commodity, is a need of individual A, and vice versa; so that they stand not only in an equal, but also in a social, relation to one another. This is not all. The fact that this need on the part of one can be satisfied by the product of the other, and vice versa, and that the one is capable of producing the object of the need of the other, and that each confronts the other as owner of the object of the other’s need, this proves that each of them reaches beyond his own particular need etc., as a human being, and that they relate to one another as human beings; that their common species-being [Gattungswesen] is acknowledged by all. It does not happen elsewhere – that elephants produce for tigers, or animals for other animals. For example. A hive of bees comprises at bottom only one bee, and they all produce the same thing. Further. In so far as these natural differences among individuals and among their commodities (products, labour etc. are not as yet different here, but exist only in the form of commodities, or, as Mr Bastiat prefers, following Say, services; Bastiat fancies that, by reducing the economic character of exchange value to its natural content, commodity or service, and thereby showing himself incapable of grasping the economic relation of exchange value as such, he has progressed a great step beyond the classical economists of the English school, who are capable of grasping the relations of production in their specificity, as such, in their pure form) form the motive for the integration of these individuals, for their social interrelation as exchangers, in which they are stipulated for each other as, and prove themselves to be, equals, there enters, in addition to the quality of equality, that of freedom. Although individual A feels a need for the commodity of individual B, he does not appropriate it by force, nor vice versa, but rather they recognize one another reciprocally as proprietors, as persons whose will penetrates their commodities. Accordingly, the juridical moment of the Person enters here, as well as that of freedom, in so far as it is contained in the former. No one seizes hold of another’s property by force. Each divests himself of his property voluntarily. But this is not all: individual A serves the need of individual B by means of the commodity a only in so far as and because individual B serves the need of individual A by means of the commodity b, and vice versa. Each serves the other in order to serve himself; each makes use of the other, reciprocally, as his means. Now both things are contained in the consciousness of the two individuals: (1) that each arrives at his end only in so far as he serves the other as means; (2) that each becomes means for the other (being for another) [Sein für andres] only as end in himself (being for self) [Sein für sich]; (3) that the reciprocity in which each is at the same time means and end, and attains his end only in so far as he becomes a means, and becomes a means only in so far as he posits himself as end, that each thus posits himself as being for another, in so far as he is being for self, and the other as being for him, in so far as he is being for himself – that this reciprocity is a necessary fact, presupposed as natural precondition of exchange, but that, as such, it is irrelevant to each of the two subjects in exchange, and that this reciprocity interests him only in so far as it satisfies his interest to the exclusion of, without reference to, that of the other. That is, the common interest which appears as the motive of the act as a whole is recognized as a fact by both sides; but, as such, it is not the motive, but rather proceeds, as it were, behind the back of these self-reflected particular interests, behind the back of one individual’s interest in opposition to that of the other. In this last respect, the individual can at most have the consoling awareness that the satisfaction of his antithetical individual interest is precisely the realization of the suspended antithesis, of the social, general interest. Out of the act of exchange itself, the individual, each one of them, is reflected in himself as its exclusive and dominant (determinant) subject. With that, then, the complete freedom of the individual is posited: voluntary transaction; no force on either side; positing of the self as means, or as serving, only as means, in order to posit the self as end in itself, as dominant and primary [übergreifend]; finally, the self-seeking interest which brings nothing of a higher order to realization; the other is also recognized and acknowledged as one who likewise realizes his self-seeking interest, so that both know that the common interest exists only in the duality, many-sidedness, and autonomous development of the exchanges between self-seeking interests. The general interest is precisely the generality of self-seeking interests. Therefore, when the economic form, exchange, posits the all-sided equality of its subjects, then the content, the individual as well as the objective material which drives towards the exchange, is freedom. Equality and freedom are thus not only respected in exchange based on exchange values but, also, the exchange of exchange values is the productive, real basis of all equality and freedom. As pure ideas they are merely the idealized expressions of this basis; as developed in juridical, political, social relations, they are merely this basis to a higher power. And so it has been in history. Equality and freedom as developed to this extent are exactly the opposite of the freedom and equality in the world of antiquity, where developed exchange value was not their basis, but where, rather, the development of that basis destroyed them. Equality and freedom presuppose relations of production as yet unrealized in the ancient world and in the Middle Ages. Direct forced labour is the foundation of the ancient world; the community rests on this as its foundation; labour itself as a ‘privilege’, as still particularized, not yet generally producing exchange values, is the basis of the world of the Middle Ages. Labour is neither forced labour; nor, as in the second case, does it take place with respect to a common, higher unit (the guild).

Now, it is admittedly correct that the [relation between those] engaged in exchange, in so far as their motives are concerned, i.e. as regards natural motives falling outside the economic process, does also rest on a certain compulsion; but this is, on one side, itself only the other’s indifference to my need as such, to my natural individuality, hence his equality with me and his freedom, which are at the same time the precondition of my own; on the other side, if I am determined, forced, by my needs, it is only my own nature, this totality of needs and drives, which exerts a force upon me; it is nothing alien (or, my interest posited in a general, reflected form). But it is, after all, precisely in this way that I exercise compulsion ever the other and drive him into the exchange system.

In Roman law, the servus is therefore correctly defined as one who may not enter into exchange for the purpose of acquiring anything for himself (see the Institutes). It is, consequently, equally clear that although this legal system corresponds to a social state in which exchange was by no means developed, nevertheless, in so far as it was developed in a limited sphere, it was able to develop the attributes of the juridical person, precisely of the individual engaged in exchange, and thus anticipate (in its basic aspects) the legal relations of industrial society, and in particular the right which rising bourgeois society had necessarily to assert against medieval society. But the development of this right itself coincides completely with the dissolution of the Roman community.

Since money is only the realization of exchange value, and since the system of exchange values has realized itself only in a developed money system, or inversely, the money system can indeed only be the realization of this system of freedom and equality. As measure, money only gives the equivalent its specific expression, makes it into an equivalent in form, as well. A distinction of form does, it is true, arise within circulation: the two exchangers appear in the different roles of buyer and seller; exchange value appears once in its general form, in the form of money, then again in its particular form, in the natural commodity, now with a price; but, first of all, these forms alternate; circulation itself creates not a disequation, but only an equation, a suspension of the merely negated difference. The inequality is only a purely formal one. Finally, even equality now posits itself tangibly, in money as medium of circulation, where it appears now in one hand, now in another, and is indifferent to this appearance. Each appears towards the other as an owner of money, and, as regards the process of exchange, as money itself. Thus indifference and equal worthiness are expressly contained in the form of the thing. The particular natural difference which was contained in the commodity is extinguished, and constantly becomes extinguished by circulation. A worker who buys commodities for 3s. appears to the seller in the same function, in the same equality – in the form of 3s. – as the king who does the same. All distinction between them is extinguished. The seller qua seller appears only as owner of a commodity of the price of 3s., so that both are completely equal; only that the 3s. exist here in the form of silver, there again in the form of sugar, etc. In the third form of money, a distinguishing quality might seem to enter between the subjects of the process. But in so far as money here appears as the material, as the general commodity of contracts, all distinction between the contracting parties is, rather, extinguished. In so far as money, the general form of wealth, becomes the object of accumulation, the subject here appears to withdraw it from circulation only to the extent that he does not withdraw commodities of an equal price from circulation. Thus, if one individual accumulates and the other does not, then none does it at the expense of the other. One enjoys real wealth, the other takes possession of wealth in its general form. If one grows impoverished and the other grows wealthier, then this is of their own free will and does not in any way arise from the economic relation, the economic connection as such, in which they are placed in relation to one another. Even inheritance and similar legal relations, which perpetuate such inequalities, do not prejudice this natural freedom and equality. If individual A’s relation is not in contradiction to this system originally, then such a contradiction can surely not arise from the fact that individual B steps into the place of individual A, thus perpetuating him. This is, rather, the perpetuation of the social relation beyond one man’s natural lifespan: its reinforcement against the chance influences of nature, whose effects as such would in fact be a suspension of individual freedom. Moreover, since the individual in this relation is merely the individuation of money, therefore he is, as such, just as immortal as money, and his representation by heirs is the logical extension of this role.

If this way of conceiving the matter is not advanced in its historic context, but is instead raised as a refutation of the more developed economic relations in which individuals relate to one another no longer merely as exchangers or as buyers and sellers, but in specific relations, no longer all of the same character; then it is the same as if it were asserted that there is no difference, to say nothing of antithesis and contradiction, between natural bodies, because all of them, when looked at from e.g. the point of view of their weight, have weight, and are therefore equal; or are equal because all of them occupy three dimensions. Exchange value itself is here similarly seized upon in its simple character, as the antithesis to its more developed, contradictory forms. In the course of science, it is just these abstract attributes which appear as the earliest and sparsest; they appear in part historically in this fashion, too; the more developed as the more recent. In present bourgeois society as a whole, this positing of prices and their circulation etc. appears as the surface process, beneath which, however, in the depths, entirely different processes go on, in which this apparent individual equality and liberty disappear. It is forgotten, on one side, that the presupposition of exchange value, as the objective basis of the whole of the system of production, already in itself implies compulsion over the individual, since his immediate product is not a product for him, but only becomes such in the social process, and since it must take on this general but nevertheless external form; and that the individual has an existence only as a producer of exchange value, hence that the whole negation of his natural existence is already implied; that he is therefore entirely determined by society; that this further presupposes a division of labour etc., in which the individual is already posited in relations other than that of mere exchanger, etc. That therefore this presupposition by no means arises either out of the individual’s will or out of the immediate nature of the individual, but that it is, rather, historical, and posits the individual as already determined by society. It is forgotten, on the other side, that these higher forms, in which exchange, or the relations of production which realize themselves in it, are now posited, do not by any means stand still in this simple form where the highest distinction which occurs is a formal and hence irrelevant one. What is overlooked, finally, is that already the simple forms of exchange value and of money latently contain the opposition between labour and capital etc. Thus, what all this wisdom comes down to is the attempt to stick fast at the simplest economic relations, which, conceived by themselves, are pure abstractions; but these relations are, in reality, mediated by the deepest antithesis, and represent only one side, in which the full expression of the antitheses is obscured.

What this reveals, on the other side, is the foolishness of those socialists (namely the French, who want to depict socialism as the realization of the ideals of bourgeois society articulated by the French revolution) who demonstrate that exchange and exchange value etc. are originally (in time) or essentially (in their adequate form) a system of universal freedom and equality, but that they have been perverted by money, capital, etc. Or, also, that history has so far failed in every attempt to implement them in their true manner, but that they have now, like Proudhon, discovered e.g. the real Jacob, and intend now to supply the genuine history of these relations in place of the fake. The proper reply to them is: that exchange value or, more precisely, the money system is in fact the system of equality and freedom, and that the disturbances which they encounter in the further development of the system are disturbances inherent in it, are merely the realization of equality and freedom, which prove to be inequality and unfreedom. It is just as pious as it is stupid to wish that exchange value would not develop into capital, nor labour which produces exchange value into wage labour. What divides these gentlemen from the bourgeois apologists is, on one side, their sensitivity to the contradictions included in the system; on the other, the utopian inability to grasp the necessary difference between the real and the ideal form of bourgeois society, which is the cause of their desire to undertake the superfluous business of realizing the ideal expression again, which is in fact only the inverted projection [Lichtbild] of this reality. And now, indeed, in opposition to these socialists there is the stale argumentation of the degenerate economics of most recent times (whose classical representative as regards insipidness, affectation of dialectics, puffy arrogance, effete, complacent platitudinousness and complete inability to grasp historic processes is Frederick Bastiat, because the American, Carey, at least brings out the specific American relations as against the European), which demonstrates that economic relations everywhere express the same simple determinants, and hence that they everywhere express the equality and freedom of the simple exchange of exchange values; this point entirely reduces itself to an infantile abstraction. For example, the relation between capital and interest is reduced to the exchange of exchange values. Thus, after first taking from the empirical world the fact that exchange value exists not only in this simple form but also in the essentially different form of capital, capital is then in turn reduced again to the simple concept of exchange value; and interest, which, to crown all, expresses a specific relation of capital as such, is similarly torn out of this specificity and equated with exchange value; the whole relation in its specific character is reduced to an abstraction and everything reduced to the undeveloped relation of commodity exchange. In so far as I abstract from what distinguishes a concrete from its abstract, it is of course the abstract, and does not differ from it at all. According to this, all economic categories are only so many names for what is always the same relation, and this crude inability to grasp the real distinctions is then supposed to represent pure common sense as such. The ‘economic harmonies’ of Mr Bastiat amount au fond to the assertion that there exists only one single economic relation which takes on different names, or that any differences which occur, occur only in name. The reduction is not even formally scientific to the minimal extent that everything is reduced to a real economic relation by dropping the difference that development makes; rather, sometimes one and sometimes another side is dropped in order to bring out now one, now another side of the identity. For example, the wage for labour is payment for a service done by one individual for another. (The economic form as such is dropped here, as noted above.) Profit is also payment for a service done by one individual for another. Hence wages and profit are identical, and it is, in the first place, an error of language to call one payment wages, the other profit. But let us now look at profit and interest. With profit, the payment of the service is exposed to chance fluctuations; with interest, it is fixed. Thus, since, with wages, payment is relatively speaking exposed to chance fluctuations, while with profit, in contrast to labour, it is fixed, it follows that the relation between interest and profit is the same as that between wages and profit, which, as we have seen, is the exchange of equivalents for one another. The opponents then take this twaddle (which goes back from the economic relations where the contradiction is expressed to those where it is only latent and obscured) literally, and demonstrate that e.g. with capital and interest there is not a simple exchange, since capital is not replaced by an equivalent, but that the owner of capital, rather, having consumed the equivalent 20 times over in the form of interest, still has it in the form of capital and can exchange it for 20 more equivalents. Hence the unedifying debate in which one side asserts that there is no difference between developed and undeveloped exchange value, and the other asserts that there is, unfortunately, a difference, but, by rights, there ought not to be.

Capital. Sum of values. – Landed property and capital. – Capital comes from circulation. Content exchange value. – Merchant capital, money capital, and money interest. – Circulation presupposes another process. Motion between presupposed extremes

Money as capital is an aspect of money which goes beyond its simple character as money. It can be regarded as a higher realization; as it can be said that man is a developed ape. However, in this way the lower form is posited as the primary subject, over the higher. In any case, money as capital is distinct from money as money. The new aspect is to be developed. On the other hand, capital as money seems to be a regression of capital to a lower form. But it is only the positing of capital in a particular form which already existed prior to it, as non-capital, and which makes up one of its presuppositions. Money recurs in all later relations; but then it does not function as mere money. If, as here, the initial task is to follow it up to its totality as money-market, then the rest of the development is presupposed and has to be brought in occasionally. Thus we give here the general character of capital before we proceed to its particularity as money.

If I state, like for example Say, that capital is a sum of values, then I state nothing more than that capital = exchange value. Every sum of values is an exchange value, and every exchange value is a sum of values. I cannot get from exchange value to capital by means of mere addition. In the pure accumulation of money, as we have seen, the relation of capitalizing [Kapitalisieren] is not yet posited.

In so-called retail trade, in the daily traffic of bourgeois life as it proceeds directly between producers and consumers, in petty commerce, where the aim on one side is to exchange the commodity for money and on the other to exchange money for commodity, for the satisfaction of individual needs – in this movement, which proceeds on the surface of the bourgeois world, there and there alone does the motion of exchange values, their circulation, proceed in its pure form. A worker who buys a loaf of bread and a millionaire who does the same appear in this act only as simple buyers, just as, in respect to them, the grocer appears only as seller. All other aspects are here extinguished. The content of these purchases, like their extent, here appears as completely irrelevant compared with the formal aspect.

As in the theory the concept of value precedes that of capital, but requires for its pure development a mode of production founded on capital, so the same thing takes place in practice. The economists therefore necessarily sometimes consider capital as the creator of values, as their source, while at other times they presuppose values for the formation of capital, and portray it as itself only a sum of values in a particular function. The existence of value in its purity and generality presupposes a mode of production in which the individual product has ceased to exist for the producer in general and even more for the individual worker, and where nothing exists unless it is realized through circulation. For the person who creates an infinitesimal part of a yard of cotton, the fact that this is value, exchange value, is not a formal matter. If he had not created an exchange value, money, he would have created nothing at all. This determination of value, then, presupposes a given historic stage of the mode of social production and is itself something given with that mode, hence a historic relation.

At the same time, individual moments of value-determination develop in earlier stages of the historic process of social production and appear as its result.

Hence, within the system of bourgeois society, capital follows immediately after money. In history, other systems come before, and they form the material basis of a less complete development of value. Just as exchange value here plays only an accompanying role to use value, it is not capital but the relation of landed property which appears as its real basis. Modern landed property, on the other hand, cannot be understood at all, because it cannot exist, without capital as its presupposition, and it indeed appears historically as a transformation of the preceding historic shape of landed property by capital so as to correspond to capital. It is, therefore, precisely in the development of landed property that the gradual victory and formation of capital can be studied, which is why Ricardo, the economist of the modern age, with great historical insight, examined the relations of capital, wage labour and ground rent within the sphere of landed property, so as to establish their specific form. The relation between the industrial capitalist and the proprietor of land appears to be a relation lying outside that of landed property. But, as a relation between the modern farmer and the landowner, it appears posited as an immanent relation of landed property itself; and the [latter], as now existing merely in its relation to capital. The history of landed property, which would demonstrate the gradual transformation of the feudal landlord into the landowner, of the hereditary, semi-tributary and often unfree tenant for life into the modern farmer, and of the resident serfs, bondsmen and villeins who belonged to the property into agricultural day-labourers, would indeed be the history of the formation of modern capital. It would include within it the connection with urban capital, trade, etc. But we are dealing here with developed bourgeois society, which is already moving on its own foundation.

Capital comes initially from circulation, and, moreover, its point of departure is money. We have seen that money which enters into circulation and at the same time returns from it to itself is the last requirement, in which money suspends itself. It is at the same time the first concept of capital, and the first form in which it appears. Money has negated itself as something which merely dissolves in circulation; but it has also equally negated itself as something which takes up an independent attitude towards circulation. This negation, as a single whole, in its positive aspects, contains the first elements of capital. Money is the first form in which capital as such appears. M–C–C–M; that money is exchanged for commodity and the commodity for money; this movement of buying in order to sell, which makes up the formal aspect of commerce, of capital as merchant capital, is found in the earliest conditions of economic development; it is the first movement in which exchange value as such forms the content – is not only the form but also its own content. This motion can take place within peoples, or between peoples for whose production exchange value has by no means yet become the presupposition. The movement only seizes upon the surplus of their directly useful production, and proceeds only on its margin. Like the Jews within old Polish society or within medieval society in general, entire trading peoples, as in antiquity (and, later on, the Lombards), can take up this position between peoples whose mode of production is not yet determined by exchange value as the fundamental presupposition. Commercial capital is only circulating capital, and circulating capital is the first form of capital; in which it has as yet by no means become the foundation of production. A more developed form is money capital and money interest, usury, whose independent appearance belongs in the same way to an earlier stage. Finally, the form C–M–M–C, in which money and circulation in general appear as mere means for the circulating commodity, which for its part again steps outside circulation and directly satisfies a need, this is itself the presupposition of that original appearance of merchant capital. The presuppositions appear distributed among different peoples; or, within society, commercial capital as such appears only as determined by this purely consumption-directed circulation. On the other side, the circulating commodity, the commodity which realizes itself only by taking on the form of another commodity, which steps outside circulation and serves immediate needs, is similarly [the] first form of capital, which is essentially commodity capital.

On the other side it is equally clear that the simple movement of exchange values, such as is present in pure circulation, can never realize capital. It can lead to the withdrawal and stockpiling of money, but as soon as money steps back into circulation, it dissolves itself in a series of exchange processes with commodities which are consumed, hence it is lost as soon as its purchasing power is exhausted. Similarly, the commodity which has exchanged itself for another commodity through the medium of money steps outside circulation in order to be consumed, destroyed. But if it is given independence from circulation, as money, it then merely represents the non-substantial general form of wealth. Since equivalents are exchanged for one another, the form of wealth which is fixed as money disappears as soon as it is exchanged for the commodity; and the use value present in the commodity, as soon as it is exchanged for money. All that can happen in the simple act of exchange is that each can be lost in its role for the other as soon as it realizes itself in it. None can maintain itself in its role by going over into the other. For this reason the sophistry of the bourgeois economists, who embellish capital by reducing it in argument to pure exchange, has been countered by its inversion, the equally sophistical, but, in relation to them, legitimate demand that capital be really reduced to pure exchange, whereby it would disappear as a power and be destroyed, whether in the form of money or of the commodity.

The repetition of the process from either of the points, money or commodity, is not posited within the conditions of exchange itself. The act can be repeated only until it is completed, i.e. until the amount of the exchange value is exchanged away. It cannot ignite itself anew through its own resources. Circulation therefore does not carry within itself the principle of self-renewal. The moments of the latter are presupposed to it, not posited by it. Commodities constantly have to be thrown into it anew from the outside, like fuel into a fire. Otherwise it flickers out in indifference. It would die out with money, as the indifferent result which, in so far as it no longer stood in any connection with commodities, prices or circulation, would have ceased to be money, to express a relation of production; only its metallic existence would be left over, while its economic existence would be destroyed. Circulation, therefore, which appears as that which is immediately present on the surface of bourgeois society, exists only in so far as it is constantly mediated. Looked at in itself, it is the mediation of presupposed extremes. But it does not posit these extremes. Thus, it has to be mediated not only in each of its moments, but as a whole of mediation, as a total process itself. Its immediate being is therefore pure semblance. It is the phenomenon of a process taking place behind it. It is now negated in every one of its moments: as a commodity – as money – and as a relation of the two, as simple exchange and circulation of both. While, originally, the act of social production appeared as the positing of exchange values and this, in its later development, as circulation – as completely developed reciprocal movement of exchange values – now, circulation itself returns back into the activity which posits or produces exchange values. It returns into it as into its ground. It is commodities (whether in their particular form, or in the general form of money) which form the presupposition of circulation; they are the realization of a definite labour time and, as such, values; their presupposition, therefore, is both the production of commodities by labour and their production as exchange values. This is their point of departure, and through its own motion it goes back into exchange-value-creating production as its result. We have therefore reached the point of departure again, production which posits, creates exchange values; but this time, production which presupposes circulation as a developed moment and which appears as a constant process, which posits circulation and constantly returns from it into itself in order to posit it anew. The movement which creates exchange value thus appears here in a much more complex form, since it is no longer only the movement of presupposed exchange values, or the movement which posits them formally as prices, but which creates, brings them forth at the same time as presuppositions. Production itself is here no longer present in advance of its products, i.e. presupposed; it rather appears as simultaneously bringing forth these results; but it does not bring them forth, as in the first stage, as merely leading into circulation, but as simultaneously presupposing circulation, the developed process of circulation. (Circulation consists at bottom only of the formal process of positing exchange value, sometimes in the role of the commodity, at other times in the role of money.)

Transition from circulation to capitalist production. – Capital objectified labour etc. – Sum of values for production of values

This movement appears in different forms, not only historically, as leading towards value-producing labour, but also within the system of bourgeois production itself, i.e. production for exchange value. With semi-barbarian or completely barbarian peoples, there is at first interposition by trading peoples, or else tribes whose production is different by nature enter into contact and exchange their superfluous products. The former case is a more classical form. Let us therefore dwell on it. The exchange of the overflow is a traffic which posits exchange and exchange value. But it extends only to the overflow and plays an accessory role to production itself. But if the trading peoples who solicit exchange appear repeatedly (the Lombards, Normans etc. play this role towards nearly all European peoples), and if an ongoing commerce develops, although the producing people still engages only in so-called passive trade, since the impulse for the activity of positing exchange values comes from the outside and not from the inner structure of its production, then the surplus of production must no longer be something accidental, occasionally present, but must be constantly repeated; and in this way domestic production itself takes on a tendency towards circulation, towards the positing of exchange values. At first the effect is of a more physical kind. The sphere of needs is expanded; the aim is the satisfaction of the new needs, and hence greater regularity and an increase of production. The organization of domestic production itself is already modified by circulation and exchange value; but it has not yet been completely invaded by them, either over the surface or in depth. This is what is called the civilizing influence of external trade. The degree to which the movement towards the establishment of exchange value then attacks the whole of production depends partly on the intensity of this external influence, and partly on the degree of development attained by the elements of domestic production – division of labour etc. In England, for example, the import of Netherlands commodities in the sixteenth century and at the beginning of the seventeenth century gave to the surplus of wool which England had to provide in exchange, an essential, decisive role. In order then to produce more wool, cultivated land was transformed into sheep-walks, the system of small tenant-farmers was broken up etc., clearing of estates took place etc. Agriculture thus lost the character of labour for use value, and the exchange of its overflow lost the character of relative indifference in respect to the inner construction of production. At certain points, agriculture itself became purely determined by circulation, transformed into production for exchange value. Not only was the mode of production altered thereby, but also all the old relations of population and of production, the economic relations which corresponded to it, were dissolved. Thus, here was a circulation which presupposed a production in which only the overflow was created as exchange value; but it turned into a production which took place only in connection with circulation, a production which posited exchange values as its exclusive content.

On the other hand, in modern production, where exchange value and developed circulation are presupposed, it is prices which determine production on one side, and production which determines prices on the other.

When it is said that capital ‘is accumulated (realized) labour (properly, objectified [vergegenständlichte] labour), which serves as the means for new labour (production)’, then this refers to the simple material of capital, without regard to the formal character without which it is not capital. This means nothing more than that capital is – an instrument of production, for, in the broadest sense, every object, including those furnished purely by nature, e.g. a stone, must first be appropriated by some sort of activity before it can function as an instrument, as means of production. According to this, capital would have existed in all forms of society, and is something altogether unhistorical. Hence every limb of the body is capital, since each of them not only has to be developed through activity, labour, but also nourished, reproduced, in order to be active as an organ. The arm, and especially the hand, are then capital. Capital would be only a new name for a thing as old as the human race, since every form of labour, including the least developed, hunting, fishing, etc., presupposes that the product of prior labour is used as means for direct, living labour. A further characteristic contained in the above definition is that the material stuff of products is entirely abstracted away, and that antecedent labour itself is regarded as its only content (matter); in the same way, abstraction is made from the particular, special purpose for which the making of this product is in its turn intended to serve as means, and merely production in general is posited as purpose. All these things only seemed a work of abstraction, which is equally valid in all social conditions and which merely leads the analysis further and formulates it more abstractly (generally) than is the usual custom. If, then, the specific form of capital is abstracted away, and only the content is emphasized, as which it is a necessary moment of all labour, then of course nothing is easier than to demonstrate that capital is a necessary condition for all human production. The proof of this proceeds precisely by abstraction from the specific aspects which make it the moment of a specifically developed historic stage of human production. The catch is that if all capital is objectified labour which serves as means for new production, it is not the case that all objectified labour which serves as means for new production is capital. Capital is conceived as a thing, not as a relation.

If it is said on the other hand that capital is a sum of values used for the production of values, then this means: capital is self-reproducing exchange value. But, formally, exchange value reproduces itself even in simple circulation. This explanation, it is true, does contain the form wherein exchange value is the point of departure, but the connection with the content (which, with capital, is not, as in the case of simple exchange value, irrelevant) is dropped. If it is said that capital is exchange value which produces profit, or at least has the intention of producing a profit, then capital is already presupposed in its explanation, for profit is a specific relation of capital to itself. Capital is not a simple relation, but a process, in whose various moments it is always capital. This process therefore to be developed. Already in accumulated labour, something has sneaked in, because, in its essential characteristic, it should be merely objectified labour, in which, however, a certain amount of labour is accumulated. But accumulated labour already comprises a quantity of objects in which labour is realized.

‘At the beginning everyone was content, since exchange extended only to objects which had no value for each exchanger: no significance was assigned to objects other than those which were without value for each exchanger; no significance was assigned to them, and each was satisfied to receive a useful thing in exchange for a thing without utility. But after the division of labour had made everyone into a merchant and society into a commercial society, no one wanted to give up his products except in return for their equivalents; it thus became necessary, in order to determine this equivalent, to know the value of the thing received.’ (Ganilh, 12, b.) This means in other words that exchange did not stand still with the formal positing of exchange values, but necessarily advanced towards the subjection of production itself to exchange value.

(1) Circulation, and exchange value deriving from circulation, the presupposition of capital

To develop the concept of capital it is necessary to begin not with labour but with value, and, precisely, with exchange value in an already developed movement of circulation. It is just as impossible to make the transition directly from labour to capital as it is to go from the different human races directly to the banker, or from nature to the steam engine. We have seen that in money, as such, exchange value has already obtained a form independent of circulation, but only a negative, transitory or, when fixated, an illusory form. It exists only in connection with circulation and as the possibility of entering into it; but it loses this character as soon as it realizes itself, and falls back on its two earlier roles, as measure of exchange value and as medium of exchange. As soon as money is posited as an exchange value which not only becomes independent of circulation, but which also maintains itself through it, then it is no longer money, for this as such does not go beyond the negative aspect, but is capital. That money is the first form in which exchange value proceeds to the character of capital, and that, hence, the first form in which capital appears is confused with capital itself, or is regarded as sole adequate form of capital – this is a historic fact which, far from contradicting our development, rather confirms it. The first quality of capital is, then, this: that exchange value deriving from circulation and presupposing circulation preserves itself within it and by means of it; does not lose itself by entering into it; that circulation is not the movement of its disappearance, but rather the movement of its real self-positing [Sichsetzen] as exchange value, its self-realization as exchange value. It cannot be said that exchange value as such is realized in simple circulation. It is always realized only in the moment of its disappearance. If the commodity is exchanged via money for another commodity, then its value-character disappears in the moment in which it realizes itself, and it steps outside the relation, becomes irrelevant to it, merely the direct object of a need. If money is exchanged for a commodity, then even the disappearance of the form of exchange is posited; the form is posited as a merely formal mediation for the purpose of gaining possession of the natural material of the commodity. If a commodity is exchanged for money, then the form of exchange value, exchange value posited as exchange value, money, persists only as long as it stays outside exchange, withdraws from it, is hence a purely illusory realization, purely ideal in this form, in which the independence of exchange value leads a tangible existence. If, finally, money is exchanged for money – the fourth form in which circulation can be analysed, but at bottom only the third form expressed in the form of exchange – then not even a formal difference appears between the things distinguished; a distinction without a difference; not only does exchange value disappear, but also the formal movement of its disappearance. At bottom, these four specific forms of simple circulation are reducible to two, which, it is true, coincide in themselves; the distinction consists in the different placing of the emphasis, the accent; which of the two moments – money and commodity – forms the point of departure. Namely, money for the commodity: i.e. the exchange value of the commodity disappears in favour of its material content (substance); or commodity for money, i.e. its content (substance) disappears in favour of its form as exchange value. In the first case, the form of exchange value is extinguished; in the second, its substance; in both, therefore, its realization is its disappearance. Only with capital is exchange value posited as exchange value in such a way that it preserves itself in circulation; i.e. it neither becomes substanceless, nor constantly realizes itself in other substances or a totality of them; nor loses its specific form, but rather preserves its identity with itself in each of the different substances. It therefore always remains money and always commodity. It is in every moment both of the moments which disappear into one another in circulation. But it is this only because it itself is a constantly self-renewing circular course of exchanges. In this relation, too, its circulation is distinct from that of simple exchange values as such. Simple circulation is in fact circulation only from the standpoint of the observer, or in itself, not posited as such. It is not always the same exchange value – precisely because its substance is a particular commodity – which first becomes money and then a commodity again; rather, it is always different commodities, different exchange values which confront money. Circulation, the circular path, consists merely of the simple repetition or alternation of the role of commodity and money, and not of the identity of the real point of departure and the point of return. Therefore, in characterizing simple circulation as such, where money alone is the persistent moment, the term mere money circulation, money turnover has been applied.

‘Capital values are self-perpetuating.’ (Say, 14.) ‘Capital – permanent’ (‘self-multiplying’ does not belong here as yet) ‘value which no longer decayed; this value tears itself loose from the commodity which created it; like a metaphysical, insubstantial quality, it always remained in the possession of the same cultivateur’ (here irrelevant; say owner) ‘for whom it cloaked itself in different forms.’ (Sismondi, VI.)

The immortality which money strove to achieve by setting itself negatively against circulation, by withdrawing from it, is achieved by capital, which preserves itself precisely by abandoning itself to circulation. Capital, as exchange value existing prior to circulation, or as presupposing and preserving itself in circulation, not only is in every moment ideally both of the two moments contained in simple circulation, but alternately takes the form of the one and of the other, though no longer merely by passing out of the one into the other, as in simple circulation, but rather by being in each of these roles at the same time a relation to its opposite, i.e. containing it ideally within itself. Capital becomes commodity and money alternately; but (1) it is itself the alternation of both these roles; (2) it becomes commodity; but not this or the other commodity, rather a totality of commodities. It is not indifferent to the substance, but to the particular form; appears in this respect as a constant metamorphosis of this substance; in so far as it is then posited as a particular content of exchange value, this particularity itself is a totality of particularity; hence indifferent not to particularity as such, but to the single or individuated particularity. The identity, the form of generality [Allgemeinheit], which it obtains is that of being exchange value and, as such, money. It is still therefore posited as money, in fact it exchanges itself as commodity for money. But posited as money, i.e. as this contradictory form of the generality of exchange value, there is posited in it at the same time that it must not, as in simple exchange, lose this generality, but must rather lose the attribute antithetical to generality, or adopt it only fleetingly; therefore it exchanges itself again for the commodity, but as a commodity which itself, in its particularity, expresses the generality of exchange value, and hence constantly changes its particular form.

If we speak here of capital, this is still merely a word. The only aspect in which capital is here posited as distinct from direct exchange value and from money is that of exchange value which preserves and perpetuates itself in and through circulation. We have so far examined only one side, that of its self-preservation in and through circulation. The other equally important side is that exchange value is presupposed, but no longer as simple exchange value, such as it exists as a merely ideal quality of the commodity before it enters into circulation, or as, rather, a merely intended quality, since it becomes exchange value only for a vanishing moment in circulation; nor as exchange value as it exists as a moment in circulation, as money; it exists here, rather, as money, as objectified exchange value, but with the addition of the relation just described. What distinguishes the second from the first is that it (1) exists in the form of objectivity; (2) arises out of circulation, hence presupposes it, but at the same time proceeds from itself as presupposition of circulation.

There are two sides in which the result of simple circulation can be expressed:

The simply negative: The commodities thrown into circulation have achieved their purpose; they are exchanged for one another; each becomes an object of a need and is consumed. With that, circulation comes to an end. Nothing remains other than money as simple residue. As such a residue, however, it has ceased to be money, loses its characteristic form. It collapses into its material, which is left over as the inorganic ashes of the process as a whole.

The positively negative: Money is negated not as objectified, independent exchange value – not only as vanishing in circulation – but rather the antithetical independence, the merely abstract generality in which it has firmly settled, is negated; but

thirdly: Exchange value as the presupposition and simultaneously the result of circulation, just as it is assumed as having emerged from circulation, must emerge from it again. If this happens in a merely formal manner, it would simply become money again; if it emerges as a real commodity, as in simple circulation, then it would become a simple object of need, consumed as such, and again lose its quality as form. For this emergence to become real, it must likewise become the object of a need and, as such, be consumed, but it must be consumed by labour, and thereby reproduce itself anew.

Differently expressed: Exchange value, as regards its content, was originally an objectified amount of labour or labour time; as such it passed through circulation, in its objectification, until it became money, tangible money. It must now again posit the point of departure of circulation, which lay outside circulation, was presupposed to it, and for which circulation appeared as an external, penetrating and internally transforming movement; this point was labour; but [it must do so] now no longer as a simple equivalent or as a simple objectification of labour, but rather as objectified exchange value, now become independent, which yields itself to labour, becomes its material, only so as to renew itself and to begin circulating again by itself. And with that it is no longer a simple positing of equivalents, a preservation of its identity, as in circulation; but rather multiplication of itself. Exchange value posits itself as exchange value only by realizing itself; i.e. increasing its value. Money (as returned to itself from circulation), as capital, has lost its rigidity, and from a tangible thing has become a process. But at the same time, labour has changed its relation to its objectivity; it, too, has returned to itself. But the nature of the return is this, that the labour objectified in the exchange value posits living labour as a means of reproducing it, whereas, originally, exchange value appeared merely as a product of labour.

Exchange value emerging from circulation, a presupposition of circulation, preserving and multiplying itself in it by means of labour

< I. (1) General concept of capital. – (2) Particularity of capital: circulating capital, fixed capital. (Capital as the necessaries of life, as raw material, as instrument of labour.) (3) Capital as money. II. (1) Quantity of capital. Accumulation. (2) Capital measured by itself. Profit. Interest. Value of capital: i.e. capital as distinct from itself as interest and profit. (3) The circulation of capitals. (α) Exchange of capital and capital. Exchange of capital with revenue. Capital and prices. (β) Competition of capitals. (γ) Concentration of capitals. III. Capital as credit. IV. Capital as share capital. V. Capital as money market. VI. Capital as source of wealth. The capitalist. After capital, landed property would be dealt with. After that, wage labour. All three presupposed, the movement of prices, as circulation now defined in its inner totality. On the other side, the three classes, as production posited in its three basic forms and presuppositions of circulation. Then the state. (State and bourgeois society. – Taxes, or the existence of the unproductive classes. – The state debt. – Population. – The state externally: colonies. External trade. Rate of exchange. Money as international coin. – Finally the world market. Encroachment of bourgeois society over the state. Crises. Dissolution of the mode of production and form of society based on exchange value. Real positing of individual labour as social and vice versa.)>

Product and capital. Value and capital. Proudhon

(Nothing is more erroneous than the manner in which economists as well as socialists regard society in relation to economic conditions. Proudhon, for example, replies to Bastiat by saying (XVI, 29): ‘For society, the difference between capital and product does not exist. This difference is entirely subjective, and related to individuals.’ Thus he calls subjective precisely what is social; and he calls society a subjective abstraction. The difference between product and capital is exactly this, that the product expresses, as capital, a particular relation belonging to a historic form of society. This so-called contemplation from the standpoint of society means nothing more than the overlooking of the differences which express the social relation (relation of bourgeois society). Society does not consist of individuals, but expresses the sum of interrelations, the relations within which these individuals stand. As if someone were to say: Seen from the perspective of society, there are no slaves and no citizens: both are human beings. Rather, they are that outside society. To be a slave, to be a citizen, are social characteristics, relations between human beings A and B. Human being A, as such, is not a slave. He is a slave in and through society. What Mr Proudhon here says about capital and product means, for him, that from the viewpoint of society there is no difference between capitalists and workers; a difference which exists precisely only from the standpoint of society.)

(For Proudhon in his polemic against Bastiat, ‘Gratuité du crédit’, everything comes down to his own wish to reduce the exchange between capital and labour to the simple exchange of commodities as exchange values, to the moments of simple circulation, i.e. he abstracts from just the specific difference on which everything depends. He says: ‘At a given moment, every product becomes capital, because everything which is consumed is at a given moment consumed reproductively.’ This very false, but never mind. ‘What is it that makes the motion of the product suddenly transform itself into that of capital? It is the idea of value. That means that the product, in order to become capital, needs to have passed through an authentic evaluation, to have been bought or sold, its price debated and fixed by a sort of legal convention. E.g. leather, coming from the slaughterhouse, is the product of the butcher. Is this leather bought by the tanner? The latter then immediately carries it or carries its value into his exploitation fund [fonds d’exploitation]. By means of the tanner’s labour, this capital becomes product again etc.’ Every capital is here ‘a constituted value’. Money is the ‘most perfect value’, constituted value to the highest power. This means, then: (1) Product becomes capital by becoming value. Or capital is just nothing more than simple value. There is no difference between them. Thus he says commodity (the natural side of the same, expressed as product) at one time, value another time, alternatively, or rather, since he presupposes the act of buying and selling, price. (2) Since money appears as the perfected form of value such as it is in simple circulation, therefore money is also the true constituted value.)

Capital and labour. Exchange value and use value for exchange value. – Money and its use value (labour) in this relation, capital. Self-multiplication of value is its only movement. – The phrase that no capitalist will employ his capital without drawing a gain from it. – Capital, as regards substance, objectified labour. Its antithesis, living, productive (i.e. value-preserving and value-increasing) labour. – Productive labour and labour as performance of a service. – Productive and unproductive labour. A. Smith etc. – Thief in Lauderdale’s sense and productive labour

The transition from simple exchange value and its circulation to capital can also be expressed in this way: Within circulation, exchange value appears double: once as commodity, again as money. If it is in one aspect, it is not in the other. This holds for every particular commodity. But the wholeness of circulation, regarded in itself, lies in the fact that the same exchange value, exchange value as subject, posits itself once as commodity, another time as money, and that it is just this movement of positing itself in this dual character and of preserving itself in each of them as its opposite, in the commodity as money and in money as commodity. This in itself is present in simple circulation, but is not posited in it. Exchange value posited as the unity of commodity and money is capital, and this positing itself appears as the circulation of capital. (Which is, however, a spiral, an expanding curve, not a simple circle.)

Let us analyse first the simple aspects contained in the relation of capital and labour, in order by this means to arrive at the inner connection not only of these aspects, but also of their further development from the earlier ones.

The first presupposition is that capital stands on one side and labour on the other, both as independent forms relative to each other; both hence also alien to one another. The labour which stands opposite capital is alien [fremde] labour, and the capital which stands opposite labour is alien capital. The extremes which stand opposite one another are specifically different. In the first positing of simple exchange value, labour was structured in such a way that the product was not a direct use value for the labourer, not a direct means of subsistence. This was the general condition for the creation of an exchange value and of exchange in general. Otherwise the worker would have produced only a product – a direct use value for himself – but not an exchange value. This exchange value, however, was materialized in a product which had, as such, a use value for others, and, as such, was the object of their needs. The use value which the worker has to offer to the capitalist, which he has to offer to others in general, is not materialized in a product, does not exist apart from him at all, thus exists not really, but only in potentiality, as his capacity. It becomes a reality only when it has been solicited by capital, is set in motion, since activity without object is nothing, or, at the most, mental activity, which is not the question at issue here. As soon as it has obtained motion from capital, this use value exists as the worker’s specific, productive activity; it is his vitality itself, directed toward a specific purpose and hence expressing itself in a specific form.

In the relation of capital and labour, exchange value and use value are brought into relation; the one side (capital) initially stands opposite the other side as exchange value, and the other (labour), stands opposite capital, as use value. In simple circulation, each of the commodities can alternately be regarded in one or the other role. In both cases, when it counts as commodity as such, it steps outside circulation as object of a need and falls entirely outside the economic relation. In so far as the commodity becomes fixed as exchange value – money – it tends towards the same formlessness, but as falling within the economic relation. In any case, the commodities are of interest in the exchange-value relation (simple circulation) only in so far as they have exchange value; on the other side their exchange value is of only passing interest, in that it suspends the one-sidedness – the usefulness, use value, existing only for the specific individual, hence existing directly for him – but not this use value itself; rather, it posits and mediates it as use value for others etc. But to the degree that exchange value as such becomes fixed in money, use value no longer confronts it as anything but abstract chaos; and, through just this separation from its substance, it collapses into itself and tends away from the sphere of simple exchange value, whose highest movement is simple circulation, and whose highest perfection is money. But within the sphere itself, the distinctness exists in fact only as a superficial difference, a purely formal distinction. Money itself in its highest fixedness is itself a commodity again, and distinguishes itself from the others only in that it expresses exchange value more perfectly; but, as currency, and precisely for that reason, it loses its exchange value as intrinsic quality, and becomes mere use value, although admittedly use value for determining the prices etc. of commodities. The aspects still immediately coincide and just as immediately they separate. Where they relate to one another independently, positively, as in the case of the commodity which becomes an object of consumption, it ceases to be a moment of the economic process; where negatively, as in the case of money, it becomes madness; madness, however, as a moment of economics and as a determinant of the practical life of peoples.

We have seen earlier that it cannot be said that exchange value is realized in simple circulation. This is so, however, because use value does not stand as such opposite exchange value, as something defined as use value by exchange value; while inversely use value as such does not stand in a connection with exchange value, but becomes a specific exchange value only because the common element of use values – labour time – is applied to it as an external yardstick. Their unity still immediately splits, and their difference still immediately coincides. It must now be posited that use value as such becomes what it becomes through exchange value, and that exchange value mediates itself through use value. In money circulation, all we had was the different forms of exchange value (price of the commodity – money) or only different use values (commodity – C), for which money, exchange value, is merely a vanishing mediation. A real connection of exchange value and use value did not take place. The commodity as such – its particularity – is for that reason an irrelevant, merely accidental, and in general imaginary content, which falls outside the relation of economic forms; or, the latter is a merely superficial form, a formal quality: the real substance lies outside its realm and stands in no relation at all to the substance as such; therefore if this formal quality as such becomes fixed in money, then it transforms itself on the sly into an irrelevant natural product, a metal, in which every trace of a connection, whether with the individual or with intercourse between individuals, is extinguished. Metal as such of course expresses no social relations; the coin form is extinguished in it as well; the last sign of life of its social significance.

Posited as a side of the relation, exchange value, which stands opposite use value itself, confronts it as money, but the money which confronts it in this way is no longer money in its character as such, but money as capital. The use value or commodity which confronts capital or the posited exchange value is no longer the commodity such as it appeared in opposition to money, where its specific form was as irrelevant as its content, and which appeared only as a completely undefined substance. First, as use value for capital, i.e. therefore as an object in exchange with which capital does not lose its value-quality, as for example does money when it is exchanged for a particular commodity. The only utility whatsoever which an object can have for capital can be to preserve or increase it. We have already seen, in the case of money, how value, having become independent as such – or the general form of wealth – is capable of no other motion than a quantitative one; to increase itself. It is according to its concept the quintessence of all use values; but since it is always only a definite amount of money (here, capital), its quantitative limit is in contradiction with its quality. It is therefore inherent in its nature constantly to drive beyond its own barrier. (As consumption-oriented wealth, e.g. in imperial Rome, it therefore appears as limitless waste, which logically attempts to raise consumption to an imaginary boundlessness, by gulping down salad of pearls etc.) Already for that reason, value which insists on itself as value preserves itself through increase; and it preserves itself precisely only by constantly driving beyond its quantitative barrier, which contradicts its character as form, its inner generality. Thus, growing wealthy is an end in itself. The goal-determining activity of capital can only be that of growing wealthier, i.e. of magnification, of increasing itself. A specific sum of money (and money always exists for its owner in a specific quantity, always as a specific sum of money) (this is to be developed as early as in the money chapter) can entirely suffice for a specific consumption, in which it ceases to be money. But as a representative of general wealth, it cannot do so. As a quantitatively specific sum, a limited sum, it is only a limited representative of general wealth, or representative of a limited wealth, which goes as far, and no further than, its exchange value, and is precisely measured in it. It thus does not by any means have the capacity which according to its general concept it ought to have, namely the capacity of buying all pleasures, all commodities, the totality of the material substances of wealth; it is not a ‘précis de toutes les choses’ etc. Fixed as wealth, as the general form of wealth, as value which counts as value, it is therefore the constant drive to go beyond its quantitative limit: an endless process. Its own animation consists exclusively in that; it preserves itself as a self-validated exchange value distinct from a use value only by constantly multiplying itself. (It is damned difficult for Messrs the economists to make the theoretical transition from the self-preservation of value in capital to its multiplication; and this in its fundamental character, not only as an accident or result. See e.g. Storch, how he brings this fundamental character in with an adverb, ‘properly’. Admittedly, the economists try to introduce this into the relation of capital as an essential aspect, but if this is not done in the brutal form of defining capital as that which brings profit, where the increase of capital itself is already posited as a special economic form, profit, then it happens only surreptitiously, and very feebly, as we shall later show in a brief review of all that the economists have contributed towards determining the concept of capital. Drivel to the effect that nobody would employ his capital without drawing a gain from it amounts either to the absurdity that the good capitalists will remain capitalists even without employing their capital; or to a very banal form of saying that gainful investment is inherent in the concept of capital. Very well. In that case it would just have to be demonstrated.) – Money as a sum of money is measured by its quantity. This measuredness contradicts its character, which must be oriented towards the measureless. Everything which has been said here about money holds even more for capital, in which money actually develops in its completed character for the first time. The only use value, i.e. usefulness, which can stand opposite capital as such is that which increases, multiplies and hence preserves it as capital.

Secondly. Capital is by definition money, but not merely money in the simple form of gold and silver, nor merely as money in opposition to circulation, but in the form of all substances – commodities. To that degree, therefore, it does not, as capital, stand in opposition to use value, but exists apart from money precisely only in use values. These, its substances themselves, are thus now transitory ones, which would have no exchange value if they had no use value; but which lose their value as use values and are dissolved by the simple metabolism of nature if they are not actually used, and which disappear even more certainly if they are actually used. In this regard, the opposite of capital cannot itself be a particular commodity, for as such it would form no opposition to capital, since the substance of capital is itself use value; it is not this commodity or that commodity, but all commodities. The communal substance of all commodities, i.e. their substance not as material stuff, as physical character, but their communal substance as commodities and hence exchange values, is this, that they are objectified labour. The only thing distinct from objectified labour is non-objectified labour, labour which is still objectifying itself, labour as subjectivity. Or, objectified labour, i.e. labour which is present in space, can also be opposed, as past labour, to labour which is present in time. If it is to be present in time, alive, then it can be present only as the living subject, in which it exists as capacity, as possibility; hence as worker. The only use value, therefore, which can form the opposite pole to capital is labour (to be exact, value-creating, productive labour. This marginal remark is an anticipation; must first be developed, by and by. Labour as mere performance of services for the satisfaction of immediate needs has nothing whatever to do with capital, since that is not capital’s concern. If a capitalist hires a woodcutter to chop wood to roast his mutton over, then not only does the wood-cutter relate to the capitalist, but also the capitalist to the wood-cutter, in the relation of simple exchange. The woodcutter gives him his service, a use value, which does not increase capital; rather, capital consumes itself in it; and the capitalist gives him another commodity for it in the form of money. The same relation holds for all services which workers exchange directly for the money of other persons, and which are consumed by these persons. This is consumption of revenue, which, as such, always falls within simple circulation; it is not consumption of capital. Since one of the contracting parties does not confront the other as a capitalist, this performance of a service cannot fall under the category of productive labour. From whore to pope, there is a mass of such rabble. But the honest and ‘working’ lumpenproletariat belongs here as well; e.g. the great mob of porters etc. who render service in seaport cities etc. He who represents money in this relation demands the service only for its use value, which immediately vanishes for him; but the porter demands money, and since the party with money is concerned with the commodity and the party with the commodity, with money, it follows that they represent to one another no more than the two sides of simple circulation; goes without saying that the porter, as the party concerned with money, hence directly with the general form of wealth, tries to enrich himself at the expense of his improvised friend, thus injuring the latter’s self-esteem, all the more so because he, a hard calculator, has need of the service not qua capitalist but as a result of his ordinary human frailty. A. Smith was essentially correct with his productive and unproductive labour, correct from the standpoint of bourgeois economy. What the other economists advance against it is either horse-piss (for instance Storch, Senior even lousier etc.), namely that every action after all acts upon something, thus confusion of the product in its natural and in its economic sense; so that the pickpocket becomes a productive worker too, since he indirectly produces books on criminal law (this reasoning at least as correct as calling a judge a productive worker because he protects from theft). Or the modern economists have turned themselves into such sycophants of the bourgeois that they want to demonstrate to the latter that it is productive labour when somebody picks the lice out of his hair, or strokes his tail, because for example the latter activity will make his fat head – blockhead – clearer the next day in the office. It is therefore quite correct – but also characteristic – that for the consistent economists the workers in e.g. luxury shops are productive, although the characters who consume such objects are expressly castigated as unproductive wastrels. The fact is that these workers, indeed, are productive, as far as they increase the capital of their master; unproductive as to the material result of their labour. In fact, of course, this ‘productive’ worker cares as much about the crappy shit he has to make as does the capitalist himself who employs him, and who also couldn’t give a damn for the junk. But, looked at more precisely, it turns out in fact that the true definition of a productive worker consists in this: A person who needs and demands exactly as much as, and no more than, is required to enable him to gain the greatest possible benefit for his capitalist. All this nonsense. Digression. But return in more detail to the productive and unproductive).

The two different processes in the exchange of capital with labour. (Here the use value of that which is exchanged for capital belongs to the specific economic form etc.)

The use value which confronts capital as posited exchange value is labour. Capital exchanges itself, or exists in this role, only in connection with not-capital, the negation of capital, without which it is not capital; the real not-capital is labour.

If we consider the exchange between capital and labour, then we find that it splits into two processes which are not only formally but also qualitatively different, and even contradictory:

(1) The worker sells his commodity, labour, which has a use value, and, as commodity, also a price, like all other commodities, for a specific sum of exchange values, specific sum of money, which capital concedes to him.

(2) The capitalist obtains labour itself, labour as value-positing activity, as productive labour; i.e. he obtains the productive force which maintains and multiplies capital, and which thereby becomes the productive force, the reproductive force of capital, a force belonging to capital itself.

The separation of these two processes is so obvious that they can take place at different times, and need by no means coincide. The first process can be and usually, to a certain extent, is completed before the second even begins. The completion of the second act presupposes the completion of the product. The payment of wages cannot wait for that. We will even find it an essential aspect of the relation, that it does not wait for that.

In simple exchange, circulation, this double process does not take place. If commodity A is exchanged for money B, and the latter then for the commodity C, which is destined to be consumed – the original object of the exchange, for A – then the using-up of commodity C, its consumption, falls entirely outside circulation; is irrelevant to the form of the relation; lies beyond circulation itself, and is of purely physical interest, expressing no more than the relation of the individual A in his natural quality to an object of his individual need. What he does with commodity C is a question which belongs outside the economic relation. Here, by contrast, the use value of that which is exchanged for money appears as a particular economic relation, and the specific utilization of that which is exchanged for money forms the ultimate aim of both processes. Therefore, this is already a distinction of form between the exchange of capital and labour, and simple exchange – two different processes.

If we now further inquire how the exchange between capital and labour is different in content from simple exchange (circulation), then we find that this difference does not arise out of an external connection or equation; but rather that, in the totality of the latter process, the second form distinguishes itself from the first, in that this equation is itself comprised within it. The difference between the second act and the first – note that the particular process of the appropriation of labour by capital is the second act – is exactly the difference between the exchange of capital and labour, and exchange between commodities as it is mediated by money. In the exchange between capital and labour, the first act is an exchange, falls entirely within ordinary circulation; the second is a process qualitatively different from exchange, and only by misuse could it have been called any sort of exchange at all. It stands directly opposite exchange; essentially different category.

Capital and modern landed property. – Wakefield

<Capital. I. Generality: (1) (a) Emergence of capital out of money. (b) Capital and labour (mediating itself through alien labour). (c) The elements of capital, dissected according to their relation to labour (Product. Raw material. Instrument of labour.) (2) Particularization of capital: (a) Capital circulant, capital fixe. Turnover of capital. (3) The singularity of capital: Capital and profit. Capital and interest. Capital as value, distinct from itself as interest and profit. II. Particularity: (1) Accumulation of capitals. (2) Competition of capitals. (3) Concentration of capitals (quantitative distinction of capital as at same time qualitative, as measure of its size and influence). III. Singularity: (1) Capital as credit. (2) Capital as stock-capital. (3) Capital as money market. In the money market, capital is posited in its totality; there it determines prices, gives work, regulates production, in a word, is the source of production; but capital, not only as something which produces itself (positing prices materially in industry etc., developing forces of production), but at the same time as a creator of values, has to posit a value or form of wealth specifically distinct from capital. This is ground rent. This is the only value created by capital which is distinct from itself, from its own production. By its nature as well as historically, capital is the creator of modern landed property, of ground rent; just as its action therefore appears also as the dissolution of the old form of property in land. The new arises through the action of capital upon the old. Capital is this – in one regard – as creator of modern agriculture. The inner construction of modern society, or, capital in the totality of its relations, is therefore posited in the economic relations of modern landed property, which appears as a process: ground rent – capital – wage labour (the form of the circle can also be put in another way: as wage labour – capital – ground rent; but capital must always appear as the active middle). The question is now, how does the transition from landed property to wage labour come about? (The transition from wage labour to capital arises by itself, since the latter is here brought back into its active foundation.) Historically, this transition is beyond dispute. It is already given in the fact that landed property is the product of capital. We therefore always find that, wherever landed property is transformed into money rent through the reaction of capital on the older forms of landed property (the same thing takes place in another way where the modern farmer is created) and where, therefore, at the same time agriculture, driven by capital, transforms itself into industrial agronomy, there the cottiers, serfs, bondsmen, tenants for life, cottagers etc. become day labourers, wage labourers, i.e. that wage labour in its totality is initially created by the action of capital on landed property, and then, as soon as the latter has been produced as a form, by the proprietor of the land himself. This latter himself then ‘clears’, as Steuart says, the land of its excess mouths, tears the children of the earth from the breast on which they were raised, and thus transforms labour on the soil itself, which appears by its nature as the direct wellspring of subsistence, into a mediated source of subsistence, a source purely dependent on social relations. (The reciprocal dependence has first to be produced in its pure form before it is possible to think of a real social communality [Gemeinschaftlichkeit]. All relations as posited by society, not as determined by nature.) Only in this way is the application of science possible for the first time, and the development of the full force of production. There can therefore be no doubt that wage labour in its classic form, as something permeating the entire expanse of society, which has replaced the very earth as the ground on which society stands, is initially created only by modern landed property, i.e. by landed property as a value created by capital itself. This is why landed property leads back to wage labour. In one regard, it is nothing more than the extension of wage labour, from the cities to the countryside, i.e. wage labour distributed over the entire surface of society. The ancient proprietor of land, if he is rich, needs no capitalist in order to become the modern proprietor of land. He needs only to transform his workers into wage workers and to produce for profit instead of for revenue. Then the modern farmer and the modern landowner are presupposed in his person. This change in the form in which he obtains his revenue or in the form in which the worker is paid is not, however, a formal distinction, but presupposes a total restructuring of the mode of production (agriculture) itself; it therefore presupposes conditions which rest on a certain development of industry, of trade, and of science, in short of the forces of production. Just as, in general, production resting on capital and wage labour differs from other modes of production not merely formally, but equally presupposes a total revolution and development of material production. Although capital can develop itself completely as commercial capital (only not as much quantitatively), without this transformation of landed property, it cannot do so as industrial capital. Even the development of manufactures presupposes the beginning of a dissolution of the old economic relations of landed property. On the other hand, only with the development of modern industry to a high degree does this dissolution at individual points acquire its totality and extent; but this development itself proceeds more rapidly to the degree that modern agriculture and the form of property, the economic relations corresponding to it, have developed. Thus England in this respect the model country for the other continental countries. Likewise: if the first form of industry, large-scale manufacture, already presupposes dissolution of landed property, then the latter is in turn conditioned by the subordinate development of capital in its primitive (medieval) forms which has taken place in the cities, and at the same time by the effect of the flowering of manufacture and trade in other countries (thus the influence of Holland on England in the sixteenth and the first half of the seventeenth century). These countries themselves had already undergone the process, agriculture had been sacrificed to cattle-raising, and grain was obtained from countries which were left behind, such as Poland etc., by import (Holland again). It must be kept in mind that the new forces of production and relations of production do not develop out of nothing, nor drop from the sky, nor from the womb of the self-positing Idea; but from within and in antithesis to the existing development of production and the inherited, traditional relations of property. While in the completed bourgeois system every economic relation presupposes every other in its bourgeois economic form, and everything posited is thus also a presupposition, this is the case with every organic system. This organic system itself, as a totality, has its presuppositions, and its development to its totality consists precisely in subordinating all elements of society to itself, or in creating out of it the organs which it still lacks. This is historically how it becomes a totality. The process of becoming this totality forms a moment of its process, of its development. – On the other hand, if within one society the modern relations of production, i.e. capital, are developed to its totality, and this society then seizes hold of a new territory, as e.g. the colonies, then it finds, or rather its representative, the capitalist, finds, that his capital ceases to be capital without wage labour, and that one of the presuppositions of the latter is not only landed property in general, but modern landed property; landed property which, as capitalized rent, is expensive, and which, as such, excludes the direct use of the soil by individuals. Hence Wakefield’s theory of colonies, followed in practice by the English government in Australia. Landed property is here artificially made more expensive in order to transform the workers into wage workers, to make capital act as capital, and thus to make the new colony productive; to develop wealth in it, instead of using it, as in America, for the momentary deliverance of the wage labourers. Wakefield’s theory is infinitely important for a correct understanding of modern landed property. – Capital, when it creates landed property, therefore goes back to the production of wage labour as its general creative basis. Capital arises out of circulation and posits labour as wage labour; takes form in this way; and, developed as a whole, it posits landed property as its precondition as well as its opposite. It turns out, however, that it has thereby only created wage labour as its general presupposition. The latter must then be examined by itself. On the other hand, modern landed property itself appears most powerfully in the process of clearing the estates and the transformation of the rural labourers into wage labourers. Thus a double transition to wage labour. This on the positive side. Negatively, after capital has posited landed property and hence arrived at its double purpose: (1) industrial agriculture and thereby development of the forces of production on the land; (2) wage labour, thereby general domination of capital over the countryside; it then regards the existence of landed property itself as a merely transitional development, which is required as an action of capital on the old relations of landed property, and a product of their decomposition; but which, as such – once this purpose achieved – is merely a limitation on profit, not a necessary requirement for production. It thus endeavours to dissolve landed property as private property and to transfer it to the state. This the negative side. Thus to transform the entire domestic society into capitalists and wage labourers. When capital has reached this point, then wage labour itself reaches the point where, on one side, it endeavours to remove the landowner as an excrescence, to simplify the relation, to lessen the burden of taxes etc., in the same form as the bourgeois; on the other hand, in order to escape wage labour and to become an independent producer – for immediate consumption – it demands the breaking-up of large landed property. Landed property is thus negated from two sides; the negation from the side of capital is only a change of form, towards its undivided rule. (Ground rent as the universal state rent (state tax), so that bourgeois society reproduces the medieval system in a new way, but as the latter’s total negation.) The negation from the side of wage labour is only concealed negation of capital, hence of itself as well. It must now be regarded as independent in respect to capital. Thus the transition double: (1) Positive transition from modern landed property, or from capital through the mediation of modern landed property, to general wage labour; (2) negative transition: negation of landed property by capital, i.e. thus negation of autonomous value by capital, i.e. precisely negation of capital by itself. But its negation is wage labour. Then negation of landed property and, through its mediation, of capital, on the part of wage labour, i.e. on the part of wage labour which wants to posit itself as independent.>

<The market, which appears as an abstract quality at the beginning of economics, takes on total shapes. First, the money market. This includes the discount market; in general, the loan market; hence money trade, bullion market. As money-lending market it appears in the banks, for instance the discount at which they discount: loan market, billbrokers etc.; but then also as the market in all interest-bearing bills: state funds and the share market. The latter separate off into larger groups (first the shares of money institutions themselves; bank shares; joint-stock bank shares; shares in the means of communication (railway shares the most important; canal shares; steam navigation shares, telegraph shares, omnibus shares); shares of general industrial enterprises (mining shares the chief ones). Then in the supply of common elements (gas shares, water-supply shares). Miscellaneous shares of a thousand kinds. For the storage of commodities (dock shares etc.). Miscellaneous in infinite variety, such as enterprises in industry or trading companies founded on shares. Finally, as security for the whole, insurance shares of all kinds.) Now, just as the market by and large is divided into home market and foreign market, so the internal market itself again divides into the market of home shares, national funds etc. and foreign funds, foreign shares etc. This development actually belongs properly under the world market, which is not only the internal market in relation to all foreign markets existing outside it, but at the same time the internal market of all foreign markets as, in turn, components of the home market. The concentration of the money market in a chief location within a country, while the other markets are more distributed according to the division of labour; although here, too, great concentration in the capital city, if the latter is at the same time a port of export. – The various markets other than the money market are, firstly, as different as are products and branches of production themselves. The chief markets in these various products arise in centres which are such either in respect of import or export, or because they are either themselves centres of a given production, or are the direct supply points of such centres. But these markets proceed from this simple difference to a more or less organic separation into large groups, which themselves necessarily divide up according to the basic elements of capital itself: product market and raw-material market. The instrument of production as such does not form a separate market; it exists as such chiefly, first, in the raw materials themselves which are sold as means of production; then, however, in particular in the metals, since these exclude all thought of direct consumption, and then the products, such as coal, oil, chemicals, which are destined to disappear as auxiliary means of production. Likewise dyes, wood, drugs etc. Hence:

I. Products. (1) Grain market with its various subdivisions. E.g. seed market: rice, sage, potatoes etc. This very important economically; at the same time market for production and for direct consumption. (2) Colonial-produce market. Coffee, tea, cocoa, sugar; spices (pepper, tobacco, pimento, cinnamon, cassia lignea, cloves, ginger, mace, nutmegs, etc.). (3) Fruits. Almonds, currants, figs, plums, prunes, raisins, oranges, lemons etc. Molasses (for production etc.). (4) Provisions. Butter; cheese; bacon; hams; lard; pork; beef (smoked), fish etc. (5) Spirits. Wine, rum, beer etc. II. Raw Materials. (1) Raw materials for mechanical industry. Flax; hemp; cotton; silk; wool; hides; leather; gutta-percha etc. (2) Raw materials for chemical industry. Potash, saltpetre; turpentine; nitrate of soda etc. III. Raw materials which at the same time instruments of production. Metals (copper, iron, tin, zinc, lead, steel etc.), wood. Lumber. Timber. Dye-woods. Specialized wood for shipbuilding etc. Accessory means of production and raw materials. Drugs and dyes. (Cochineal, indigo etc. Tar. Tallow. Oil. Coals etc.) Of course, every product must go to market, but really great markets, as distinct from retail trade, are formed only by the great consumption goods (economically important are only the grain market, the tea, the sugar, the coffee market (wine market to some extent, and market in spirits generally), or those which are raw materials of industry: wool, silk, wood, metal market etc.) To be seen at what point the abstract category of the market has to be brought in.>

Exchange between capital and labour. Piecework wages. – Value of labour power. – Share of the wage labourer in general wealth determined only quantitatively. – The worker’s equivalent, money. Thus confronts capital as equal. – But aim of his exchange satisfaction of his need. Money for him only medium of circulation. – Savings, self-denial as means of the worker’s enrichment. – Valuelessness and devaluation of the worker a condition of capital

The exchange between the worker and the capitalist is a simple exchange; each obtains an equivalent; the one obtains money, the other a commodity whose price is exactly equal to the money paid for it; what the capitalist obtains from this simple exchange is a use value: disposition over alien labour. From the worker’s side – and service is the exchange in which he appears as seller – it is evident that the use which the buyer makes of the purchased commodity is as irrelevant to the specific form of the relation here as it is in the case of any other commodity, of any other use value. What the worker sells is the disposition over his labour, which is a specific one, specific skill etc.

What the capitalist does with his labour is completely irrelevant, although of course he can use it only in accord with its specific characteristics, and his disposition is restricted to a specific labour and is restricted in time (so much labour time). The piece-work system of payment, it is true, introduces the semblance that the worker obtains a specified share of the product. But this is only another form of measuring time (instead of saying, you will work for 12 hours, what is said is, you get so much per piece; i.e. we measure the time you have worked by the number of products); it is here, in the examination of the general relation, altogether beside the point. If the capitalist were to content himself with merely the capacity of disposing, without actually making the worker work, e.g. in order to have his labour as a reserve, or to deprive his competitor of this capacity of disposing (like e.g. theatre directors who buy singers for a season not in order to have them sing, but so that they do not sing in a competitor’s theatre), then the exchange has taken place in full. True, the worker receives money, hence exchange value, the general form of wealth, in one or another quantity; and the more or less he receives, the greater or the lesser is the share in the general wealth he thus obtains. How this more or less is determined, how the quantity of money he receives is measured, is of so little relevance to the general relation that it cannot be developed out of the latter. In general terms, the exchange value of his commodity cannot be determined by the manner in which its buyer uses it, but only by the amount of objectified labour contained in it; hence, here, by the amount of labour required to reproduce the worker himself. For the use value which he offers exists only as an ability, a capacity [Vermögen] of his bodily existence; has no existence apart from that. The labour objectified in that use value is the objectified labour necessary bodily to maintain not only the general substance in which his labour power exists, i.e. the worker himself, but also that required to modify this general substance so as to develop its particular capacity. This, in general terms, is the measure of the amount of value, the sum of money, which he obtains in exchange. The further development, where wages are measured, like all other commodities, by the labour time necessary to produce the worker as such, is not yet to the point here. Within circulation, if I exchange a commodity for money, buy a commodity for it and satisfy my need, then the act is at an end. Thus it is with the worker. But he has the possibility of beginning it again from the beginning because his life is the source in which his own use value constantly rekindles itself up to a certain time, when it is worn out, and constantly confronts capital again in order to begin the same exchange anew. Like every individual subject within circulation, the worker is the owner of a use value; he exchanges this for money, for the general form of wealth, but only in order to exchange this again for commodities, considered as the objects of his immediate consumption, as the means of satisfying his needs. Since he exchanges his use value for the general form of wealth, he becomes co-participant in general wealth up to the limit of his equivalent – a quantitative limit which, of course, turns into a qualitative one, as in every exchange. But he is neither bound to particular objects, nor to a particular manner of satisfaction. The sphere of his consumption is not qualitatively restricted, only quantitatively. This distinguishes him from the slave, serf etc. Consumption certainly reacts on production itself; but this reaction concerns the worker in his exchange as little as it does any other seller of a commodity; rather, as regards mere circulation – and we have as yet no other developed relation before us – it falls outside the economic relation. This much, however, can even now be mentioned in passing, namely that the relative restriction on the sphere of the workers’ consumption (which is only quantitative, not qualitative, or rather, only qualitative as posited through the quantitative) gives them as consumers (in the further development of capital the relation between consumption and production must, in general, be more closely examined) an entirely different importance as agents of production from that which they possessed e.g. in antiquity or in the Middle Ages, or now possess in Asia. But, as noted, this does not belong here yet. Similarly, because the worker receives the equivalent in the form of money, the form of general wealth, he is in this exchange an equal vis-à-vis the capitalist, like every other party in exchange; at least, so he seems. In fact this equality is already disturbed because the worker’s relation to the capitalist as a use value, in the form specifically distinct from exchange value, in opposition to value posited as value, is a presupposition of this seemingly simple exchange; because, thus, he already stands in an economically different relation – outside that of exchange, in which the nature of the use value, the particular use value of the commodity is, as such, irrelevant. This semblance exists, nevertheless, as an illusion on his part and to a certain degree on the other side, and thus essentially modifies his relation by comparison to that of workers in other social modes of production. But what is essential is that the purpose of the exchange for him is the satisfaction of his need. The object of his exchange is a direct object of need, not exchange value as such. He does obtain money, it is true, but only in its role as coin; i.e. only as a self-suspending and vanishing mediation. What he obtains from the exchange is therefore not exchange value, not wealth, but a means of subsistence, objects for the preservation of his life, the satisfaction of his needs in general, physical, social etc. It is a specific equivalent in means of subsistence, in objectified labour, measured by the cost of production of his labour. What he gives up is his power to dispose of the latter. On the other side, it is true that even within simple circulation the coin may grow into money, and that in so far as he receives coin in exchange, he can therefore transform it into money by stockpiling it, etc., withdrawing it from circulation; fixes it as general form of wealth, instead of as vanishing medium of exchange. In this respect it could thus be said that, in the exchange between capital and labour, the worker’s object – hence, for him, the product of the exchange – is not the means of subsistence, but wealth; not a particular use value, but rather exchange value as such. Accordingly the worker could make exchange value into his own product only in the same way in which wealth in general can appear solely as product of simple circulation in which equivalents are exchanged, namely by sacrificing substantial satisfaction to obtain the form of wealth, i.e. through self-denial, saving, cutting corners in his consumption so as to withdraw less from circulation than he puts goods into it. This is the only possible form of enriching oneself which is posited by circulation itself. Self-denial could then also appear in the more active form, which is not posited in simple circulation, of denying himself more and more rest, and in general denying himself any existence other than his existence as worker, and being as far as possible a worker only; hence more frequently renewing the act of exchange, or extending it quantitatively, hence through industriousness. Hence still today the demand for industriousness and also for saving, self-denial, is made not upon the capitalists but on the workers, and namely by the capitalists. Society today makes the paradoxical demand that he for whom the object of exchange is subsistence should deny himself, not he for whom it is wealth. The illusion that the capitalists in fact practised ‘self-denial’ and became capitalists thereby – a demand and a notion which only made any sense at all in the early period when capital was emerging from feudal etc. relations – has been abandoned by all modern economists of sound judgement. The workers are supposed to save, and much bustle is made with savings banks etc. (As regards the latter, even the economists admit that their proper purpose is not wealth, either, but merely a more purposeful distribution of expenditure, so that in their old age, or in case of illness, crises etc., they do not become a burden on the poorhouses, on the state, or on the proceeds of begging (in a word, so that they become a burden on the working class itself and not on the capitalists, vegetating out of the latter’s pockets), i.e. so that they save for the capitalists; and reduce the costs of production for them.) Still, no economist will deny that if the workers generally, that is, as workers (what the individual worker does or can do, as distinct from his genus, can only exist just as exception, not as rule, because it is not inherent in the character of the relation itself), that is, if they acted according to this demand as a rule (apart from the damage they would do to general consumption – the loss would be enormous – and hence also to production, thus also to the amount and volume of the exchanges which they could make with capital, hence to themselves as workers) then the worker would be employing means which absolutely contradict their purpose, and which would directly degrade him to the level of the Irish, the level of wage labour where the most animal minimum of needs and subsistence appears to him as the sole object and purpose of his exchange with capital. If he adopted wealth as his purpose, instead of making his purpose use value, he would then, therefore, not only come to no riches, but would moreover lose use value in the bargain. For, as a rule, the maximum of industriousness, of labour, and the minimum of consumption – and this is the maximum of his self-denial and of his moneymaking – could lead to nothing else than that he would receive for his maximum of labour a minimum of wages. By his exertions he would only have diminished the general level of the production costs of his own labour and therefore its general price. Only as an exception does the worker succeed through will power, physical strength and endurance, greed etc., in transforming his coin into money, as an exception from his class and from the general conditions of his existence. If all or the majority are too industrious (to the degree that industriousness in modern industry is in fact left to their own personal choice, which is not the case in the most important and most developed branches of production), then they increase not the value of their commodity, but only its quantity; that is, the demands which would be placed on it as use value. If they all save, then a general reduction of wages will bring them back to earth again; for general savings would show the capitalist that their wages are in general too high, that they receive more than its equivalent for their commodity, the capacity of disposing of their own labour; since it is precisely the essence of simple exchange – and they stand in this relation towards him – that no one throws more into circulation than he withdraws; but also that no one can withdraw more than he has thrown in. An individual worker can be industrious above the average, more than he has to be in order to live as a worker, only because another lies below the average, is lazier; he can save only because and if another wastes. The most he can achieve on the average with his self-denial is to be able better to endure the fluctuations of prices – high and low, their cycle – that is, he can only distribute his consumption better, but never attain wealth. And that is actually what the capitalists demand. The workers should save enough at the times when business is good to be able more or less to live in the bad times, to endure short time or the lowering of wages. (The wage would then fall even lower.) That is, the demand that they should always hold to a minimum of life’s pleasures and make crises easier to bear for the capitalists etc. Maintain themselves as pure labouring machines and as far as possible pay their own wear and tear. Quite apart from the sheer brutalization to which this would lead – and such a brutalization itself would make it impossible even to strive for wealth in general form, as money, stockpiled money – (and the worker’s participation in the higher, even cultural satisfactions, the agitation for his own interests, newspaper subscriptions, attending lectures, educating his children, developing his taste etc., his only share of civilization which distinguishes him from the slave, is economically only possible by widening the sphere of his pleasures at the times when business is good, where saving is to a certain degree possible), [apart from this,] he would, if he saved his money in a properly ascetic manner and thus heaped up premiums for the lumpenproletariat, pickpockets etc., who would increase in proportion with the demand, he could conserve savings – if they surpass the piggy-bank amounts of the official savings banks, which pay him a minimum of interest, so that the capitalists can strike high interest rates out of his savings, or the state eats them up, thereby merely increasing the power of his enemies and his own dependence – conserve his savings and make them fruitful only by putting them into banks etc., so that, afterwards, in times of crisis he loses his deposits, after having in times of prosperity foregone all life’s pleasures in order to increase the power of capital; thus has saved in every way for capital, not for himself.

Incidentally – in so far as the whole thing is not a hypocritical phrase of bourgeois ‘philanthropy’, which consists in fobbing the worker off with ‘pious wishes’ – each capitalist does demand that his workers should save, but only his own, because they stand towards him as workers; but by no means the remaining world of workers, for these stand towards him as consumers. In spite of all ‘pious’ speeches he therefore searches for means to spur them on to consumption, to give his wares new charms, to inspire them with new needs by constant chatter etc. It is precisely this side of the relation of capital and labour which is an essential civilizing moment, and on which the historic justification, but also the contemporary power of capital rests. (This relation between production and consumption to be developed only under capital and profit etc.) (Or, then again, under accumulation and competition of capitals.) These are nevertheless all exoteric observations, relevant here only in so far as they show the demands of hypocritical bourgeois philanthropy to be self-contradictory and thus to prove precisely what they were supposed to refute, namely that in the exchange between the worker and capital, the worker finds himself in the relation of simple circulation, hence obtains not wealth but only subsistence, use values for immediate consumption. That this demand contradicts the relation itself emerges from the simple reflection (the recently and complacently advanced demand that the workers should be given a certain share in profits is to be dealt with in the section wage labour; other than as a special bonus which can achieve its purpose only as an exception from the rule, and which is in fact, in noteworthy practice, restricted to the buying-up of individual overlookers etc. in the interests of the employer against the interests of their class; or to travelling salesmen etc., in short, no longer simple workers, hence also not to the simple relation; or else it is a special way of cheating the workers and of deducting a part of their wages in the more precarious form of a profit depending on the state of the business) that, if the worker’s savings are not to remain merely the product of circulation – saved up money, which can be realized only by being converted sooner or later into the substantial content of wealth, pleasures etc. – then the saved-up money would itself have to become capital, i.e. buy labour, relate to labour as use value. It thus presupposes labour which is not capital, and presupposes that labour has become its opposite – not-labour. In order to become capital, it itself presupposes labour as not-capital as against capital; hence it presupposes the establishment at another point of the contradiction it is supposed to overcome. if, then, in the original relation itself, the object and the product of the worker’s exchange – as product of mere exchange, it can be no other – were not use value, subsistence, satisfaction of direct needs, withdrawal from circulation of the equivalent put into it in order to be destroyed by consumption – then labour would confront capital not as labour, not as not-capital, but as capital. But capital, too, cannot confront capital if capital does not confront labour, since capital is only capital as not-labour; in this contradictory relation. Thus the concept and the relation of capital itself would be destroyed. That there are situations in which property-owners who themselves work engage in exchange with one another is certainly not denied. But such conditions are not those of the society in which capital as such exists in developed form; they are destroyed at all points, therefore, by its development. As capital it can posit itself only by positing labour as not-capital, as pure use value. (As a slave, the worker has exchange value, a value; as a free wage-worker he has no value; it is rather his power of disposing of his labour, effected by exchange with him, which has value. It is not he who stands toward the capitalist as exchange value, but the capitalist toward him. His valuelessness and devaluation is the presupposition of capital and the precondition of free labour in general. Linguet regards it as a step backwards; he forgets that the worker is thereby formally posited as a person who is something for himself apart from his labour, and who alienates his life-expression only as a means towards his own life. So long as the worker as such has exchange value, industrial capital as such cannot exist, hence nor can developed capital in general. Towards the latter, labour must exist as pure use value, which is offered as a commodity by its possessor himself in exchange for it, for its exchange value, which of course becomes real in the worker’s hand only in its role as general medium of exchange; otherwise vanishes.) Well. The worker, then, finds himself only in the relation of simple circulation, of simple exchange, and obtains only coin for his use value; subsistence; but mediated. This form of mediation is, as we saw, essential to and characteristic of the relation. That it can proceed to the transformation of the coin into money – savings – proves precisely only that his relation is that of simple circulation; he can save more or less; but beyond that he cannot get; he can realize what he has saved only by momentarily expanding the sphere of his pleasures. It is of importance – and penetrates into the character of the relation itself – that, because money is the product of his exchange, general wealth drives him forward as an illusion; makes him industrious. At the same time, this not only formally opens up a field of arbitrariness in the realiz …

Notebook III (29 November – mid December 1857)

(Labour power as capital!) – Wages not productive

… processes of the same subject; thus e.g. the substance of the eye, the capital of vision etc. Such belletristic phrases, which relate everything to everything else by means of some analogy, may even appear profound the first time they are expressed, all the more so if they identify the most disparate things. Repeated, however, and then repeated with outright complacency as statements of scientific value, they are purely and simply ridiculous. Good only for belletristic sophomores and empty chatterboxes who defile all the sciences with their liquorice-sweet filth. The fact that labour is a constant new source of exchange for the worker as long as he is capable of working – meaning not exchange in general, but exchange with capital – is inherent in the nature of the concept itself, namely that he only sells a temporary disposition over his labouring capacity, hence can always begin the exchange anew as soon as he has taken in the quantity of substances required in order to reproduce the externalization of his life [Lebensäusserung]. Instead of aiming their amazement in this direction – and considering the worker to owe a debt to capital for the fact that he is alive at all, and can repeat certain life processes every day as soon as he has eaten and slept enough – these whitewashing sycophants of bourgeois economics should rather have fixed their attention on the fact that, after constantly repeated labour, he always has only his living, direct labour itself to exchange. The repetition itself is in fact only apparent. What he exchanges for capital is his entire labouring capacity, which he spends, say, in 20 years. Instead of paying him for it in a lump sum, capital pays him in small doses, as he places it at capital’s disposal, say weekly. This alters absolutely nothing in the nature of the thing and gives no grounds whatsoever for concluding that – because the worker has to sleep 10–12 hours before he becomes capable of repeating his labour and his exchange with capital – labour forms his capital. What this argument in fact conceives as capital is the limit, the interruption of his labour, since he is not a perpetuum mobile. The struggle for the ten hours’ bill etc. proves that the capitalist likes nothing better than for him to squander his dosages of vital force as much as possible, without interruption. We now come to the second process, which forms the relation between capital and labour after this exchange. We want to add here only that the economists themselves express the above statement by saying that wages are not productive. For them, of course, to be productive means to be productive of wealth. Now, since wages are the product of the exchange between worker and capital – and the only product posited in this act itself – they therefore admit that the worker produces no wealth in this exchange, neither for the capitalist, because for the latter the payment of money for a use value – and this payment forms the only function of capital in this relation – is a sacrifice of wealth, not creation of the same, which is why he tries to pay the smallest amount possible; nor for the worker, because it brings him only subsistence, the satisfaction of individual needs, more or less – never the general form of wealth, never wealth. Nor can it do so, since the content of the commodity which he sells rises in no way above the general laws of circulation: [his aim is] to obtain for the value which he throws into circulation its equivalent, through the coin, in another use value, which he consumes. Such an operation, of course, can never bring wealth, but has to bring back him who undertakes it exactly to the point at which he began. This does not exclude, as we saw, but rather includes, the fact that the sphere of his immediate gratifications is capable of a certain contraction or expansion. On the other side, if the capitalist – who is not yet posited as capitalist at all in this exchange, but only as money – were to repeat this act again and again, his money would soon be eaten up by the worker, who would have wasted it in a series of other gratifications, mended trousers, polished boots – in short, services received. In any case, the repetition of this operation would be precisely limited by the circumference of his moneybag. They would no more enrich him than does the expenditure of money for other use values for his beloved person, which, as is well known, do not – pay him, but cost him.

The exchange between capital and labour belongs within simple circulation, does not enrich the worker. – Separation of labour and property the precondition of this exchange. – Labour as object absolute poverty, labour as subject general possibility of wealth. – Labour without particular specificity confronts capital

It may seem peculiar, in this relation between labour and capital, and already in this first relation of exchange between the two, that the worker here buys the exchange value and the capitalist the use value, in that labour confronts capital not as a use value, but as the use value pure and simple, but that the capitalist should obtain wealth, and the worker merely a use value which ends with consumption. <In so far as this concerns the capitalist, to be developed only with the second process.> This appears as a dialectic which produces precisely the opposite of what was to be expected. However, regarded more precisely, it becomes clear that the worker who exchanges his commodity goes through the form C–M–M–C in the exchange process. If the point of departure in circulation is the commodity, use value, as the principle of exchange, then we necessarily arrive back at the commodity, since money appears only as coin and, as medium of exchange, is only a vanishing mediation; while the commodity as such, after having described its circle, is consumed as the direct object of need. On the other hand, capital represents M–C–C–M, the antithetical moment.

Separation of property from labour appears as the necessary law of this exchange between capital and labour. Labour posited as not-capital as such is: (1) not-objectified labour [nicht-vergegenständlichte Arbeit], conceived negatively (itself still objective; the not-objective itself in objective form). As such it is not-raw-material, not-instrument of labour, not-raw-product: labour separated from all means and objects of labour, from its entire objectivity. This living labour, existing as an abstraction from these moments of its actual reality (also, not-value); this complete denudation, purely subjective existence of labour, stripped of all objectivity. Labour as absolute poverty: poverty not as shortage, but as total exclusion of objective wealth. Or also as the existing not-value, and hence purely objective use value, existing without mediation, this objectivity can only be an objectivity not separated from the person: only an objectivity coinciding with his immediate bodily existence. Since the objectivity is purely immediate, it is just as much direct not-objectivity. In other words, not an objectivity which falls outside the immediate presence [Dasein] of the individual himself. (2) Not-objectified labour, not-value, conceived positively, or as a negativity in relation to itself, is the not-objectified, hence non-objective, i.e. subjective existence of labour itself. Labour not as an object, but as activity; not as itself value, but as the living source of value. [Namely, it is] general wealth (in contrast to capital in which it exists objectively, as reality) as the general possibility of the same, which proves itself as such in action. Thus, it is not at all contradictory, or, rather, the in-every-way mutually contradictory statements that labour is absolute poverty as object, on one side, and is, on the other side, the general possibility of wealth as subject and as activity, are reciprocally determined and follow from the essence of labour, such as it is presupposed by capital as its contradiction and as its contradictory being, and such as it, in turn, presupposes capital.

The last point to which attention is still to be drawn in the relation of labour to capital is this, that as the use value which confronts money posited as capital, labour is not this or another labour, but labour pure and simple, abstract labour; absolutely indifferent to its particular specificity [Bestimmtheit], but capable of all specificities. Of course, the particularity of labour must correspond to the particular substance of which a given capital consists; but since capital as such is indifferent to every particularity of its substance, and exists not only as the totality of the same but also as the abstraction from all its particularities, the labour which confronts it likewise subjectively has the same totality and abstraction in itself. For example, in guild and craft labour, where capital itself still has a limited form, and is still entirely immersed in a particular substance, hence is not yet capital as such, labour, too, appears as still immersed in its particular specificity: not in the totality and abstraction of labour as such, in which it confronts capital. That is to say that labour is of course in each single case a specific labour, but capital can come into relation with every specific labour; it confronts the totality of all labours δυνάμει, and the particular one it confronts at a given time is an accidental matter. On the other side, the worker himself is absolutely indifferent to the specificity of his labour; it has no interest for him as such, but only in as much as it is in fact labour and, as such, a use value for capital. It is therefore his economic character that he is the carrier of labour as such – i.e. of labour as use value for capital; he is a worker, in opposition to the capitalist. This is not the character of the craftsmen and guild-members etc., whose economic character lies precisely in the specificity of their labour and in their relation to a specific master, etc. This economic relation – the character which capitalist and worker have as the extremes of a single relation of production – therefore develops more purely and adequately in proportion as labour loses all the characteristics of art; as its particular skill becomes something more and more abstract and irrelevant, and as it becomes more and more a purely abstract activity, a purely mechanical activity, hence indifferent to its particular form; a merely formal activity, or, what is the same, a merely material [stofflich] activity, activity pure and simple, regardless of its form. Here it can be seen once again that the particular specificity of the relation of production, of the category – here, capital and labour – becomes real only with the development of a particular material mode of production and of a particular stage in the development of the industrial productive forces. (This point in general to be particularly developed in connection with this relation, later; since it is here already posited in the relation itself, while, in the case of the abstract concepts, exchange value, circulation, money, it still lies more in our subjective reflection.)

Labour process absorbed into capital. (Capital and capitalist)

(2) We now come to the second side of the process. The exchange between capital or capitalist and the worker is now finished, in so far as we are dealing with the process of exchange as such. We now proceed to the relation of capital to labour as capital’s use value. Labour is not only the use value which confronts capital, but, rather, it is the use value of capital itself. As the not-being of values in so far as they are objectified, labour is their being in so far as they are not-objectified; it is their ideal being; the possibility of values, and, as activity, the positing of value. As against capital, labour is the merely abstract form, the mere possibility of value-positing activity, which exists only as a capacity, as a resource in the bodiliness of the worker. But when it is made into a real activity through contact with capital – it cannot do this by itself, since it is without object – then it becomes a really value-positing, productive activity. In relation with capital, this activity can in general consist only of the reproduction of itself – of the preservation and increase of itself as the real and effective value, not of the merely intended value, as with money as such. Through the exchange with the worker, capital has appropriated labour itself; labour has become one of its moments, which now acts as a fructifying vitality upon its merely existent and hence dead objectivity. Capital is money (exchange value posited for itself), but no longer is it money as existing in a particular substance and hence excluded from other substances of exchange value and existing alongside them, but rather money as obtaining its ideal character from all substances, from the exchange values of every form and mode of objectified labour. Now, in so far as capital, money existing in all particular forms of objectified labour, enters into the process with not-objectified, but rather living labour, labour existing as process and as action, it is initially this qualitative difference of the substance in which it exists from the form in which it now also exists as labour. It is the process of this differentiation and of its suspension, in which capital itself becomes a process. Labour is the yeast thrown into it, which starts it fermenting. On the one side, the objectivity in which it exists has to be worked on, i.e. consumed by labour; on the other side, the mere subjectivity of labour as a mere form has to be suspended, and labour has to be objectified in the material of capital. The relation of capital, in its content, to labour, of objectified labour to living labour – in this relation, where capital appears as passive towards labour, it is its passive being, as a particular substance, which enters into relation with the forming activity of labour – can, in general, be nothing more than the relation of labour to its objectivity, its material – which is to be analysed already in the first chapter, which has to precede exchange value and treat of production in general – and in connection with labour as activity, the material, the objectified labour, has only two relations, that of the raw material, i.e. of the formless matter, the mere material for the form-positing, purposive activity of labour, and that of the instrument of labour, the objective means which subjective activity inserts between itself as an object, as its conductor. The concept of the product, which the economists introduce here, does not yet belong here at all as an aspect distinct from raw material and instrument of labour. It appears as result, not as presupposition of the process between the passive content of capital and labour as activity. As a presupposition, the product is not a distinct relation of the object to labour; distinct from raw material and instrument of labour, since raw material and instrument of labour, as substance of values, are themselves already objectified labour, products. The substance of value is not at all the particular natural substance, but rather objectified labour. This latter itself appears again in connection with living labour as raw material and instrument of labour. As regards the pure act of production in itself, it may seem that the instrument of labour and the raw material are found freely in nature, so that they need merely to be appropriated, i.e. made into the object and means of labour, which is not itself a labour process. Thus, in contrast to them, the product appears as something qualitatively different, and is a product not only as a result of labour with an instrument on a material, but rather as the first objectification of labour alongside them. But, as components of capital, raw material and instrument of labour are themselves already objectified labour, hence product. This does not yet exhaust the relation. For, e.g. in the kind of production in which no exchange value, no capital at all exists, the product of labour can become the means and the object of new labour. For example, in agricultural production purely for use value. The hunter’s bow, the fisherman’s net, in short the simplest conditions, already presuppose a product which ceases to count as product and becomes raw material or more specifically instrument of production, for this [is] actually the first specific form in which the product appears as the means of reproduction. This link therefore by no means exhausts the relation in which raw material and instrument of labour appear as moments of capital itself. The economists, incidentally, introduce the product as third element of the substance of capital in another connection entirely, as well. This is the product in so far as its character is to step outside both the process of production and circulation, and to become immediate object of individual consumption; approvisionnement, as Cherbuliez calls it. That is, the products presupposed so that the worker lives as a worker and is capable of living during production, before a new product is created. That the capitalist possesses this capacity is posited in the fact that every element of capital is money, and, as such, can be transformed from its general form of wealth into the material of wealth, object of consumption. The economists’ approvisionnement thus applies only to the workers; i.e. it is money expressed in the form of articles of consumption, use values, which they obtain from the capitalist in the act of exchange between the two of them. But this belongs within the first act. The extent to which this first relates to the second is not yet the question here. The only diremption posited by the process of production itself is the original diremption, that posited by the difference between objective labour and living labour itself, i.e. that between raw material and instrument of labour. It is quite consistent of the economists to confuse these two aspects with each other, because they must bring the two moments in the relation between capital and labour into confusion and cannot allow themselves to grasp their specific difference.

Thus: the raw material is consumed by being changed, formed by labour, and the instrument of labour is consumed by being used up in this process, worn out. On the other hand, labour also is consumed by being employed, set into motion, and a certain amount of the worker’s muscular force etc. is thus expended, so that he exhausts himself. But labour is not only consumed, but also at the same time fixed, converted from the form of activity into the form of the object; materialized; as a modification of the object, it modifies its own form and changes from activity to being. The end of the process is the product, in which the raw material appears as bound up with labour, and in which the instrument of labour has, likewise, transposed itself from a mere possibility into a reality, by having become a real conductor of labour, but thereby also having been consumed in its static form through its mechanical or chemical relation to the material of labour. All three moments of the process, the material, the instrument, and labour, coincide in the neutral result – the product. The moments of the process of production which have been consumed to form the product are simultaneously reproduced in it. The whole process therefore appears as productive consumption, i.e. as consumption which terminates neither in a void, nor in the mere subjectification of the objective, but which is, rather, again posited as an object. This consumption is not simply a consumption of the material, but rather consumption of consumption itself; in the suspension of the material it is the suspension of this suspension and hence the positing of the same. This form-giving activity consumes the object and consumes itself, but it consumes the given form of the object only in order to posit it in a new objective form, and it consumes itself only in its subjective form as activity. It consumes the objective character of the object – the indifference towards the form – and the subjective character of activity; forms the one, materializes the other. But as product, the result of the production process is use value.

If we now regard the result so far obtained, we find:

Firstly: The appropriation, absorption of labour by capital – money, i.e. the act of buying the capacity of disposing over the worker, here appears only as a means to bring this process about, not as one of its moments – brings capital into ferment, and makes it into a process, process of production, in whose totality it relates to itself not only as objectified by living labour, but also, because objectified, [as] mere object of labour.

Secondly: Within simple circulation, the substance of the commodity and of money was itself indifferent to the formal character, i.e. to the extent that commodity and money remained moments of circulation. As for the substance of the commodity, it fell outside the economic relation as an object of consumption (of need); money, in so far as its form achieved independence, was still related to circulation, but only negatively, and was only this negative relation. Fixed for itself, it similarly became extinguished in dead materiality, and ceased to be money. Both commodity and money were expressions of exchange value, and differed only as general and particular exchange value. This difference itself was again merely a nominal one, since not only were the two roles switched in real circulation, but also, if we consider each of them by itself, money itself was a particular commodity, and the commodity as price was itself general money. The difference was only formal. Each of them was posited in the one role only in so far as and because it was not posited in the other. Now however, in the process of production, capital distinguishes itself as form from itself as substance. It is both aspects at once, and at the same time the relation of both to one another. But:

Thirdly: It still only appeared as this relation in itself. The relation is not posited yet, or it is posited initially only in the character of one of its two moments, the material moment, which divides internally into material (raw material and instrument) and form (labour), and which, as a relation between both of them, as a real process, is itself only a material relation again – a relation of the two material elements which form the content of capital as distinct from its formal relation as capital. If we now consider the aspect of capital in which it originally appears in distinction from labour, then it is merely a passive presence in the process, a merely objective being, in which the formal character which makes it capital – i.e. a social relation existing as being-for-itself [für sich seiendes] – is completely extinguished. It enters the process only as content – as objectified labour in general; but the fact that it is objectified labour is completely irrelevant to labour – and the relation of labour to it forms the process; it enters into the process, is worked on, rather, only as object, not as objectified labour. Cotton which becomes cotton yarn, or cotton yarn which becomes cloth, or cloth which becomes the material for printing and dyeing, exist for labour only as available cotton, yarn, cloth. They themselves do not enter into any process as products of labour, as objectified labour, but only as material existences with certain natural properties. How these were posited in them makes no difference to the relation of living labour towards them; they exist for it only in so far as they exist as distinct from it, i.e. as material for labour. This [is the case], in so far as the point of departure is capital in its objective form, presupposed to labour. On another side, in so far as labour itself has become one of capital’s objective elements through the exchange with the worker, labour’s distinction from the objective elements of capital is itself a merely objective one; the latter in the form of rest, the former in the form of activity. The relation is the material relation between one of capital’s elements and the other; but not its own relation to both. It therefore appears on one side as a merely passive object, in which all formal character is extinguished; it appears on the other side only as a simple production process into which capital as such, as distinct from its substance, does not enter. It does not even appear in the substance appropriate to itself – as objectified labour, for this is the substance of exchange value – but rather only in the natural form-of-being [Daseinsform] of this substance, in which all relation to exchange value, to objectified labour, and to labour itself as the use value of capital – and hence all relation to capital itself – is extinguished. Regarded from this side, the process of capital coincides with the simple process of production as such, in which its character as capital is quite as extinguished in the form of the process, as money was extinguished as money in the form of value. To the extent to which we have examined the process so far, capital in its being-for-itself, i.e. the capitalist, does not enter at all. It is not the capitalist who is consumed by labour as raw material and instrument of labour. And it is not the capitalist who does this consuming but rather labour. Thus the process of the production of capital does not appear as the process of the production of capital, but as the process of production in general, and capital’s distinction from labour appears only in the material character of raw material and instrument of labour. It is this aspect – which is not only an arbitrary abstraction, but rather an abstraction which takes place within the process itself – on which the economists seize in order to represent capital as a necessary element of every production process. Of course, they do this only by forgetting to pay attention to its conduct as capital during this process.

This is the occasion to draw attention to a moment which here, for the first time, not only arises from the standpoint of the observer, but is posited in the economic relation itself. In the first act, in the exchange between capital and labour, labour as such, existing for itself, necessarily appeared as the worker. Similarly here in the second process: capital as such is posited as a value existing for itself, as egotistic value, so to speak (something to which money could only aspire). But capital in its being-for-itself is the capitalist. Of course, socialists sometimes say, we need capital, but not the capitalist. Then capital appears as a pure thing, not as a relation of production which, reflected in itself, is precisely the capitalist. I may well separate capital from a given individual capitalist, and it can be transferred to another. But, in losing capital, he loses the quality of being a capitalist. Thus capital is indeed separable from an individual capitalist, but not from the capitalist, who, as such, confronts the worker. Thus also the individual worker can cease to be the being-for-itself [Fürsichsein] of labour; he may inherit or steal money etc. But then he ceases to be a worker. As a worker he is nothing more than labour in its being-for-itself. (This to be further developed later.)

Production process as content of capital. Productive and unproductive labour (productive labour – that which produces capital). – The worker relates to his labour as exchange value, the capitalist as use value etc. – He divests himself [entäussert sich] of labour as the wealth-producing power. (Capital appropriates it as such.) Transformation of labour into capital etc. Sismondi, Cherbuliez, Say, Ricardo, Proudhon etc.

Nothing can emerge at the end of the process which did not appear as a presupposition and precondition at the beginning. But, on the other hand, everything also has to come out. Thus, if at the end of the process of production, which was begun with the presuppositions of capital, capital appears to have vanished as a formal relation, then this can have taken place only because the invisible threads which draw it through the process have been overlooked. Let us therefore consider this side.

The first result, then, is this:

(α) Capital becomes the process of production through the incorporation of labour into capital; initially, however, it becomes the material process of production; the process of production in general, so that the process of the production of capital is not distinct from the material process of production as such. Its formal character is completely extinguished. Because capital has exchanged a part of its objective being for labour, its objective being is itself internally divided into object and labour; the connection between them forms the production process, or, more precisely, the labour process. With that, the labour process posited prior to value, as point of departure – which, owing to its abstractness, its pure materiality, is common to all forms of production – here reappears again within capital, as a process which proceeds within its substance and forms its content.

(It will be seen that even within the production process itself this extinguishing of the formal character is merely a semblance.)

In so far as capital is value, but appears as a process initially in the form of the simple production process, the production process posited in no particular economic form, but rather, the production process pure and simple, to that extent – depending on which particular aspect of the simple production process (which, as such, as we saw, by no means presupposes capital, but is common to all modes of production) is fixed on – it can be said that capital becomes product, or that it is instrument of labour or raw material for labour. Further, if it is conceived in one of the aspects which confronts labour as material or as mere means, then it is correct to say that capital is not productive, because it is then regarded merely as the object, the material which confronts labour; as merely passive. The correct thing, however, is that it appears not as one of these aspects, nor as a difference within one of these aspects, nor as mere result (product), but rather as the simple production process itself; that this latter now appears as the self-propelling content of capital.

(β) Now to look at the side of the form-character, such as it preserves and modifies itself in the production process.

As use value, labour exists only for capital, and is itself the use value of capital, i.e. the mediating activity by means of which it realizes [verwertet] itself. Capital, as that which reproduces and increases its value, is autonomous exchange value (money), as a process, as the process of realization. Therefore, labour does not exist as a use value for the worker; for him it is therefore not a power productive of wealth, [and] not a means or the activity of gaining wealth. He brings it as a use value into the exchange with capital, which then confronts him not as capital but rather as money. In relation to the worker, it is capital as capital only in the consumption of labour, which initially falls outside this exchange and is independent of it. A use value for capital, labour is a mere exchange value for the worker; available exchange value. It is posited as such in the act of exchange with capital, through its sale for money. The use value of a thing does not concern its seller as such, but only its buyer. The property of saltpetre, that it can be used to make gunpowder, does not determine the price of saltpetre; rather, this price is determined by the cost of production of saltpetre, by the amount of labour objectified in it. The value of use values which enter circulation as prices is not the product of circulation, although it realizes itself only in circulation; rather, it is presupposed to it, and is realized only through exchange for money. Similarly, the labour which the worker sells as a use value to capital is, for the worker, his exchange value, which he wants to realize, but which is already determined prior to this act of exchange and presupposed to it as a condition, and is determined like the value of every other commodity by supply and demand; or, in general, which is our only concern here, by the cost of production, the amount of objectified labour, by means of which the labouring capacity of the worker has been produced and which he therefore obtains for it, as its equivalent. The exchange value of labour, the realization of which takes place in the process of exchange with the capitalist, is therefore presupposed, predetermined, and only undergoes the formal modification which every only ideally posited price takes on when it is realized. It is not determined by the use value of labour. It has a use value for the worker himself only in so far as it is exchange value, not in so far as it produces exchange values. It has exchange value for capital only in so far as it is use value. It is a use value, as distinct from exchange value, not for the worker himself, but only for capital. The worker therefore sells labour as a simple, predetermined exchange value, determined by a previous process – he sells labour itself as objectified labour; i.e. he sells labour only in so far as it already objectifies a definite amount of labour, hence in so far as its equivalent is already measured, given; capital buys it as living labour, as the general productive force of wealth; activity which increases wealth. It is clear, therefore, that the worker cannot become rich in this exchange, since, in exchange for his labour capacity as a fixed, available magnitude, he surrenders its creative power, like Esau his birthright for a mess of pottage. Rather, he necessarily impoverishes himself, as we shall see further on, because the creative power of his labour establishes itself as the power of capital, as an alien power confronting him. He divests himself [entäussert sich] of labour as the force productive of wealth; capital appropriates it, as such. The separation between labour and property in the product of labour, between labour and wealth, is thus posited in this act of exchange itself. What appears paradoxical as result is already contained in the presupposition. The economists have expressed this more or less empirically. Thus the productivity of his labour, his labour in general, in so far as it is not a capacity but a motion, real labour, comes to confront the worker as an alien power; capital, inversely, realizes itself through the appropriation of alien labour. (At least the possibility of realization is thereby posited; as result of the exchange between labour and capital. The relation is realized only in the act of production itself, where capital really consumes the alien labour.) Just as labour, as a presupposed exchange value, is exchanged for an equivalent in money, so the latter is again exchanged for an equivalent in commodities, which are consumed. In this process of exchange, labour is not productive; it becomes so only for capital; it can take out of circulation only what it has thrown into it, a predetermined amount of commodities, which is as little its own product as it is its own value. Sismondi says that the workers exchange their labour for grain, which they consume, while their labour ‘has become capital for its master’. (Sismondi, VI.) ‘Giving their labour in exchange, the workers transform it into capital.’ (id., VIII.) By selling his labour to the capitalist, the worker obtains a right only to the price of labour, not to the product of his labour, nor to the value which his labour has added to it. (Cherbuliez XXVIII.) ‘Sale of labour = renunciation of all fruits of labour.’ (loc.cit.) Thus all the progress of civilization, or in other words every increase in the powers of social production [gesellschaftliche Produktivkräfte], if you like, in the productive powers of labour itself – such as results from science, inventions, division and combination of labour, improved means of communication, creation of the world market, machinery etc. – enriches not the worker but rather capital; hence it only magnifies again the power dominating over labour; increases only the productive power of capital. Since capital is the antithesis of the worker, this merely increases the objective power standing over labour. The transformation of labour (as living, purposive activity) into capital is, in itself, the result of the exchange between capital and labour, in so far as it gives the capitalist the title of ownership to the product of labour (and command over the same). This transformation is posited only in the production process itself. Thus, the question whether capital is productive or not is absurd. Labour itself is productive only if absorbed into capital, where capital forms the basis of production, and where the capitalist is therefore in command of production. The productivity of labour becomes the productive force of capital just as the general exchange value of commodities fixes itself in money. Labour, such as it exists for itself in the worker in opposition to capital, that is, labour in its immediate being, separated from capital, is not productive. Nor does it ever become productive as an activity of the worker so long as it merely enters the simple, only formally transforming process of circulation. Therefore, those who demonstrate that the productive force ascribed to capital is a displacement, a transposition of the productive force of labour, forget precisely that capital itself is essentially this displacement, this transposition, and that wage labour as such presupposes capital, so that, from its standpoint as well, capital is this transubstantiation; the necessary process of positing its own powers as alien to the worker. Therefore, the demand that wage labour be continued but capital suspended is self-contradictory, self-dissolving. Others say, even economists, e.g. Ricardo, Sismondi etc., that only labour is productive, not capital. But then they do not conceive capital in its specific character as form, as a relation of production reflected into itself, but think only about its material substance, raw material etc. But these material elements do not make capital into capital. Then, however, they recall that capital is also in another respect a value, that is, something immaterial, something indifferent to its material consistency. Thus, Say: ‘Capital is always an immaterial essence, because it is not material which makes capital, but the value of this material, a value which has nothing corporeal about it.’ (Say, 21.) Or: Sismondi: ‘Capital is a commercial idea.’ (Sismondi, LX.) But then they recall that capital is a different economic quality as well, other than value, since otherwise it would not be possible to speak of capital as distinct from value at all, and, if all capitals were value, all values as such would still not be capital. Then they take refuge again in its material form within the production process, e.g. when Ricardo explains that capital is ‘accumulated labour employed in the production of new labour’, i.e. merely as instrument of labour or material for labour. In this sense Say even speaks of the ‘productive service of capital’, on which remuneration is supposed to be based, as if the instrument of labour as such were entitled to thanks from the worker, and as if it were not precisely because of him that it is posited as instrument of labour, as productive. This presupposes the autonomy of the instrument of labour, i.e. of its social character, i.e. its character as capital, in order to derive the privileges of capital from it. Proudhon’s phrase ‘le capital vaut, le travail produit’ means absolutely nothing more than: capital is value, and, since nothing further is here said about capital other than that it is value, that value is value (the subject of the judgement is here only another name for the predicate); and labour produces, is productive labour, i.e. labour is labour, since it is precisely nothing apart from ‘produire’. It must be obvious that these identical judgements do not contain any particularly deep wisdom, and that above all, they cannot express a relation in which value and labour enter into connection, in which they connect and divide in relation to one another, and where they do not lie side by side in mutual indifference. Already the fact that it is labour which confronts capital as subject, i.e. the worker only in his character as labour, and not he himself, should open the eyes. This alone, disregarding capital, already contains a relation, a relation of the worker to his own activity, which is by no means the ‘natural’ one, but which itself already contains a specific economic character.

To the extent that we are considering it here, as a relation distinct from that of value and money, capital is capital in general, i.e. the incarnation of the 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. But we are still concerned neither with a particular form of capital, nor with an individual capital as distinct from other individual capitals etc. We are present at 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 developments 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.

Realization process [Verwertungsprozess]. – (Costs of production.) – (Surplus value not explicable by exchange. Ramsay. Ricardo.) Capitalist cannot live from his wage etc. (Faux frais de production.) – Mere self-preservation, non-multiplication of value contradicts the essence of capital

Hitherto, capital has been regarded from its material side as a simple production process. But, from the side of its formal specificity this process is a process of self-realization. Self-realization includes preservation of the prior value, as well as its multiplication.

Value enters as subject. Labour is purposeful activity, and the material side therefore presupposes that the instrument of labour has really been used as means to an end in the production process, and that the raw material has obtained a higher use value as product than it had before, whether this is due to chemical alteration or mechanical modification. However, this side alone, as impinging merely on the use value, still belongs in the simple production process. It is not the point here – this is, rather, understood, presupposed – that a higher use value has been created (this in itself is very relative; when grain is transformed into spirits, the higher use value is itself already posited in respect of circulation); no higher use value has yet been created for the individual, the producer. This, in any case, is accidental, and does not affect the relation as such; rather, a higher use value for others. The point is, [rather,] that a higher exchange value be created. In the case of simple circulation, the process ended for the individual commodity by its being consumed as use value. With that, it left circulation; lost its exchange value, its economic form-character [Formbestimmung] in general. Capital has consumed its material with labour and its labour with material; it has consumed itself as use value, but only as use value for itself, as capital. Its consumption as use value therefore in this case falls within circulation itself, or rather it itself posits the beginning of circulation or its end, as one prefers. The consumption of the use value itself here falls within the economic process, because the use value here is itself determined by exchange value. In no moment of the production process does capital cease to be capital or value to be value, and, as such, exchange value. Nothing is more ridiculous than to say, as does Mr Proudhon, that capital changes from a product into an exchange value by means of the act of exchange, i.e. by re-entering simple circulation. We would then be thrown back to the beginning, to direct barter even, where we observe the origin of exchange value out of the product. Already its presupposition as self-preserving exchange value comprises the possibility that capital can and does re-enter into circulation as a commodity at the end of the production process, after its consumption as use value. However, in so far as the product now again becomes commodity, and as commodity, exchange value, and obtains a price and is realized as such in money, to that extent it is a simple commodity, exchange value as such, and, as such, its fate within circulation may be to be realized in money, or it may equally be that it does not realize itself in money; i.e. that its exchange value becomes money or not. Thus its exchange value has become much more problematic – before, it was posited ideally – than the fact that it came into existence. What is more, its being really posited as a higher exchange value in circulation cannot originate out of circulation itself, in which, in its simple character, only equivalents are exchanged. Therefore, if it comes out of circulation as a higher exchange value, it must have entered into it as such.

Capital as a form consists not of objects of labour and labour, but rather of values, and, still more precisely, of prices. The fact that its value-elements have various substances in common during the production process does not affect their character as values; they are not changed thereby. If, out of the form of unrest – of the process – at the end of the process, they again condense themselves into a resting, objective form, in the product, then this, too, is merely a change of the material [Stoffwechsel] in relation to value, and does not alter the latter. True, the substances as such have been destroyed, but they have not been made into nothing, but rather into a substance with another form. Earlier, they appeared as elemental, indifferent preconditions of the product. Now they are the product. The value of the product can therefore only = the sum of the values which were materialized in the specific material elements of the process, i.e. raw material, instrument of labour (including the merely instrumental commodities), and labour itself. The raw material has been entirely used up, labour has been entirely used up, the instrument has been only partly used up, hence continues to possess a part of the value of the capital in its specific mode of existence as present prior to the process. This part therefore does not come under view here at all, since it has suffered no modification. The different modes in which the values existed were a pure semblance; value itself formed the constantly self-identical essence within their disappearance. Regarded as a value, the product has in this respect not become product, but rather remained identical, unchanged value, which merely exists in a different mode, which is, however, irrelevant to it and which can be exchanged for money. The value of the product is = to the value of the raw material + the value of the part of the instrument of labour which has been destroyed, i.e. transferred to the product, and which is suspended in its original form, + the value of labour. Or, the price of the product is equal to these costs of production, i.e. = to the sum of the prices of the commodities consumed in the production process. That means, in other words, nothing more than that the production process in its material aspect has been irrelevant to value; that value therefore has remained identical with itself and has merely taken on another mode of existence, become materialized in another substance and form. (The form of the substance is irrelevant to the economic form, to value as such.) If capital was originally = to 100 thalers, then afterwards, as before, it remains equal to 100 thalers, although the 100 thalers existed in the production price as 50 thalers of cotton, 40 thalers of wages + 10 thalers of spinning machine, and now exist as cotton yarn to the price of 100 thalers. This reproduction of the 100 thalers is a simple retention of self-equivalence [Sichselbstgleichbleiben], except that it is mediated through the material production process. The latter must therefore proceed to the product, for otherwise cotton loses its value, instrument of labour used up for nothing, wages paid in vain. The only stipulation for the self-preservation of value is that the production process really be a total process, i.e. continue to the point where a product exists. The completeness [Totalität] of the production process, i.e. the fact that it proceeds to the product, is here in fact the precondition of the self-preservation, the self-equivalent retention of value; but this is already contained in the first precondition, that capital really becomes use value, a real production process; is therefore presupposed at this point. On the other hand, the production process is a production process for capital only to the extent that it preserves itself in this process as value, i.e. as product. The statement that the necessary price = the sum of the prices of the costs of production is therefore purely analytical. It is the presupposition of the production of capital itself. First capital is posited as 100 thalers, as simple value; then it is posited in this process as a sum of prices of specific value-elements of itself, elements specified by the price of production itself. The price of capital, its value expressed in money, = the price of its product. That means the value of capital as the result of the production process is the same as it was as the presupposition of the process. However, during the process it does not retain the simplicity it had at the beginning, and which it takes on once again at the end, as the result; rather, it decomposes into the initially quite irrelevant quantitative elements of value of labour (wage), value of the instrument of labour, and value of the raw material. No further relation has been posited, other than that the simple value decomposes quantitatively to form the price of production, as a number of values which recombine in their simplicity in the product, but which exists now as a sum. But the sum is = to the original unity. Otherwise, as regards value, and apart from the quantitative subdivision, there is not the least difference in the relation between the distinct amounts of value. The original capital was 100 thalers; the product is 100 thalers, but now 100 thalers as the sum of 50 + 40 + 10 thalers. I could just as well have regarded the original 100 thalers as a sum of 50 + 40 + 10 thalers, but equally as a sum of 60 + 30 + 10 thalers, etc. The fact that they now appear as the sum of specific amounts of units is posited because each of the different material elements into which capital decomposed in the production process represents a part of its value, but a specific part.

It will be seen later that these amounts into which the original unity is decomposed themselves have certain relations with one another, but this does not concern us here yet. In so far as any movement in the value itself is posited during the production process, it is the purely formal one which consists of the following simple act: that value exists first as a unity, a specific amount of units, which are themselves regarded as a unity, a whole: capital in the amount of 100 thalers; secondly, that this unity is divided during the production process into 50 thalers, 40 thalers and 10 thalers, a division which is essential to the extent that material, instrument and labour are required in specific quantities, but which here appears, in regard to the 100 thalers themselves, merely as an irrelevant decomposition of the same unity into different amounts; finally, that the 100 thalers reappear as a sum in the product. The only process, as regards value, [is] that it sometimes appears as a whole, unity; then as a division of this unity into certain amounts; finally, as sum. The 100 thalers which appear at the end as a sum are just as much a sum and in fact exactly the same sum as that which appeared at the outset as a unity. The character of being a sum, of being added up, arose only out of the subdivision which took place in the act of production; but does not exist in the product as such. The statement thus says nothing more than that the price of the product = the price of the costs of production, or that the value of capital = the value of the product, that the value of the capital has preserved itself in the act of production, and now appears as a sum. With this mere identity of capital, or, reproduction of its value throughout the production process, we would have come no further than we were at the beginning. What was there at the outset as presupposition is now there as result, and in unchanged form. It is clear that it is not in fact this to which the economists refer when they speak of the determination of price by the cost of production. Otherwise, a value greater than that originally present could never be created; no greater exchange value, although perhaps a greater use value, which is quite beside the point here. We are dealing with the use value of capital as such, not with the use of value of a commodity.

When one says that the cost of production or the necessary price of a commodity is = to 110, then one is calculating in the following way: Original capital = 100 (e.g. raw material = 50; labour = 40; instrument = 10) + 5% interest + 5% profit. Thus the production cost = 110, not = 100; the production cost is thus greater than the cost of production. Now, it is no help at all to flee from exchange value to the use value of the commodity, as some economists love to do. Whether the use value is greater or lesser is not, as such, determined by the exchange value. Commodities often fall beneath their prices of production, although they indisputably have obtained a higher use value than they had in the period prior to production. It is equally useless to seek refuge in circulation. I produce at 100, but I sell at 110. ‘Profit is not made by exchanging. Had it not existed before, neither could it after that transaction.’ (Ramsay, IX, 88.) This signifies the attempt to explain the augmentation of value with the aid of simple circulation, despite the fact that the latter expressly posits value as an equivalent only. It is clear even empirically that if everyone sold for 10% too much, this is the same as if they all sold at the cost of production. The surplus value [Mehrwert] would then be purely nominal, artificial, a convention, an empty phrase. And, since money is itself a commodity, a product, it also would be sold for 10% too much, i.e. the seller who received 110 thalers would in fact receive only 100. (Consult Ricardo on foreign trade, which he conceives as simple circulation, and says, therefore: ‘foreign trade can never increase the amount of exchange value in a country’. (Ricardo, 39, 40.) The grounds he cites for this conclusion are absolutely the same as those which ‘prove’ that exchange as such, simple circulation, i.e. commerce in general, in so far as it is conceived as such, can never increase exchange values, never create exchange value.) The statement that the price = the cost of production would otherwise have to read, also: the price of a commodity is always greater than its cost of production. In addition to the simple division and re-addition, the production process also adds the formal element to value, namely that its elements now appear as production costs, i.e. precisely that the elements of the production process are not preserved in their material character, but rather as values, while the mode of existence which these had before the production process is consumed.

It is clear, on another side, that if the act of production is merely the reproduction of the value of capital, then it would have undergone a merely material but not an economic change, and such a simple preservation of its value contradicts its concept [Begriff]. True, it would not remain outside circulation, as in the case of autonomous money, but would, rather, take on the form of different commodities; however, it would do so for nothing; this would be a purposeless process, since it would ultimately represent only the same sum of money, and would only have run the risk of suffering some damage in the act of production – [moreover, it is a process] which can fail, and in which money surrenders its immortal form. Well then. The production process is now at an end. The product, too, is realized in money again, and has again taken on the original form of the 100 thalers. But the capitalist has to eat and drink, too; he cannot live from this change into the form of money. Thus, a part of the 100 thalers would have to be exchanged not as capital, but as coin for commodities as use values, and be consumed in this form. The 100 thalers would have become 90, and since he always ultimately reproduces capital in the form of money, more precisely, in the quantity of money with which he began production, at the end the 100 thalers would be eaten up and the capital would have disappeared. But the capitalist is paid for the labour of throwing the 100 thalers into the production process as capital, instead of eating them up. But with what is he to be paid? And does not his labour appear as absolutely useless, since capital includes the wage; so that the workers could live from the simple reproduction of the cost of production, which the capitalist cannot do? He would thus appear among the faux frais de production. But, whatever his merits may be, reproduction would be possible without him, since, in the production process, the workers only transfer the value which they take out, hence have no need for the entire relation of capital in order to begin it always anew; and secondly, there would then be no fund out of which to pay him what he deserves, since the price of the commodity = the cost of production. But, if his labour were defined as a particular labour alongside and apart from that of the workers, e.g. that of the labour of superintendence etc., then he would, like them, receive a certain wage, would thus fall into the same category as they, and would by no means relate to labour as a capitalist; and he would never get rich, but receive merely an exchange value which he would have to consume via circulation. The existence of capital vis-à-vis labour requires that capital in its being-for-itself, the capitalist, should exist and be able to live as not-worker. It is equally clear, on the other side, that capital, even as conventionally defined, would not retain its value if it could retain nothing but its value. The risks of production have to be compensated. Capital has to preserve itself through the fluctuations of prices. The constantly ongoing devaluation of capital, resulting from the increase in the force of production, has to be compensated, etc. The economists therefore state flatly that if no gain, no profit were to be made, everyone would eat up his money instead of throwing it into production and employing it as capital. In short, if this not-realization [Nichtverwerten], i.e. the non-multiplication of the value of capital, is presupposed, then what is presupposed is that capital is not a real element of production, that it is not a specific relation of production; then a condition is presupposed in which the production costs do not have the form of capital and where capital is not posited as the condition of production.

It is easy to understand how labour can increase use value; the difficulty is, how it can create exchange values greater than those with which it began.

Suppose that the exchange value which capital pays the worker were an exact equivalent for the value which labour creates in the production process. In that case, an increase in the exchange value of the product would be impossible. Everything which labour as such had brought into the production process, in addition to the already present value of the raw material and of the instrument of labour, would have been paid to the worker. In so far as the value of the product is a surplus over and above the value of raw material and instrument, that value would go to the worker; except that the capitalist would pay him this value in his wages, and that the worker pays it back to the capitalist in the product.

Capital enters the cost of production as capital. Interest-bearing capital. Proudhon

<Interest on borrowed capital makes tangible the truth that what is meant by the cost of production – even by economists who make this assertion – is not the sum of values which enter into production. For the industrial capitalist, interest is among his direct expenses, his real costs of production. But interest itself already presupposes that capital emerges from production as surplus value, since interest is itself only one form of this surplus value. Therefore, since, from the standpoint of the borrower, interest already enters into his direct production costs, it is apparent that capital enters as such into the cost of production, but that capital as such is not the mere addition of its value-components. – As interest, capital itself appears again in the character of a commodity, but a commodity specifically distinct from all other commodities; capital as such – not as a mere sum of exchange values – enters into circulation and becomes a commodity. Here, the character of the commodity is itself present as an economic, specific determinant, not irrelevant as in simple circulation, nor directly related to labour as its opposite, as its use value, as with industrial capital; [but, rather,] capital as it exists in its further aspects, after emerging from circulation and production. The commodity as capital; or capital as commodity, is therefore not exchanged for an equivalent in circulation; by entering into circulation, it obtains its being-for-itself; it obtains its original relation to its owner, even when it passes into the possession of another. It is therefore merely loaned. For its owner, its use value as such is its realization [Verwertung]; money as money, not as medium of circulation; its use value as capital. The demand raised by Mr Proudhon, that capital should not be loaned out and should bear no interest, but should be sold like a commodity for its equivalent, amounts at bottom to no more than the demand that exchange value should never become capital, but always remain simple exchange value; that capital should not exist as capital. This demand, combined with the other, that wage labour should remain the general basis of production, reveals a happy confusion with regard to the simplest economic concepts. Hence the miserable role he plays in the polemic with Bastiat, about which, later. His chatter about considerations of fairness and right only amounts to this, that he wants to use the relation of property or of law corresponding to simple exchange as the measuring-rod for the relation of property and law at a higher stage of exchange value. Which is why Bastiat himself, unconsciously, stresses those moments of simple circulation which drive in the direction of capital. – Capital itself as commodity is money as capital or capital as money.>

<The third moment to be developed in the formation of the concept of capital is original accumulation [ursprüngliche Akkumulation] as against labour, hence the still objectless labour vis-à-vis accumulation. The first moment took its point of departure from value, as it arose out of and presupposed circulation. This was the simple concept of capital; money on the direct path to becoming capital; the second moment proceeded from capital as the presupposition and result of production; the third moment posits capital as a specific unity of circulation and production. (Relation between capital and labour, capitalist and worker itself [posited] as a result of the production process.) A distinction is to be drawn between the accumulation of capitals, which presupposes capitals, the relation of capital as present [daseiend], which also presupposes its relations to labour, prices (fixed capital and circulating capital), interest and profit. But in order to come into being, capital presupposes a certain accumulation; which is already contained in the independent antithesis between objectified and living labour; in the independent survival of this antithesis. This accumulation, necessary for capital to come into being, which is therefore already included in its concept as presupposition – as a moment – is to be distinguished essentially from the accumulation of capital which has already become capital, where there must already be capitals.>

<We have already seen so far that capital presupposes: (1) the production process in general, such as is common to all social conditions, that is, without historic character, human, if you like; (2) circulation which is already a specific historic product in each of its moments, and even more so in its totality; (3) capital as a specific unity of the two. Now, the extent to which the production process in general comes to be modified historically as soon as it becomes merely an element of capital has to be found out in the course of developing it; just as the simple conception of the specific characteristics of capital must yield its general historic presuppositions.>

<Everything else is empty chatter. Only at the end, and as a result of the whole development, can it become clear which aspects belong in the first section, ‘Production in General’, and which into the first section of the second section, ‘Exchange Value in General’. We already saw, for example, that the distinction between use value and exchange value belongs within economics itself, and that use value does not lie dead as a simple presupposition, which is what Ricardo makes it do. The chapter on production objectively ends with the product as result; that on circulation begins with the commodity, which is itself again a use value and an exchange value (hence, also, distinct from both, a value), circulation as the unity of both – which is, however, merely formal and hence collapses into the commodity as mere object of consumption, extra-economic, and exchange value as independent money.>

Surplus value. Surplus labour time. – Bastiat on wages. Value of labour. How determined? – Self-realization is self-preservation of capital. Capitalist may not live merely from his labour etc. Conditions for the self-realization of capital. Surplus labour time etc. – To the extent that capital is productive (as creator of surplus labour etc.), this only historic-transitory. – The free blacks in Jamaica. – Wealth which has gained autonomy requires slave labour or wage labour (forced labour in both cases)

The surplus value which capital has at the end of the production process – a surplus value which, as a higher price of the product, is realized only in circulation, but, like all prices, is realized in it by already being ideally presupposed to it, determined before they enter into it – signifies, expressed in accord with the general concept of exchange value, that the labour time objectified in the product – or amount of labour (expressed passively, the magnitude of labour appears as an amount of space; but expressed in motion, it is measurable only in time) – is greater than that which was present in the original components of capital. This in turn is possible only if the labour objectified in the price of labour is smaller than the living labour time purchased with it. The labour time objectified in capital appears, as we have seen, as a sum consisting of three parts: (a) the labour time objectified in the raw material; (b) the labour time objectified in the instrument of labour; (c) the labour time objectified in the price of labour. Now, parts (a) and (b) remain unchanged as components of capital; while they may change their form, their modes of material existence, in the process, they remain unchanged as values. Only in (c) does capital exchange one thing for something qualitatively different; a given amount of objectified labour for an amount of living labour. If living labour reproduced only the labour time objectified in the labour price, this also would be merely formal, and, as regards value, the only change which would have taken place would have been that from one mode to another mode of the existence of the same value, just as, in regard to the value of the material of labour and the instrument, only a change of its mode of material existence has taken place. If the capitalist has paid the worker a price = one working day, and the worker’s working day adds only one working day to the raw material and the instrument, then the capitalist would merely have exchanged exchange value in one form for exchange value in another. He would not have acted as capital. At the same time, the worker would not have remained within the simple exchange process; he would in fact have obtained the product of his labour in payment, except that the capitalist would have done him the favour of paying him the price of the product in advance of its realization [Realisation]. The capitalist would have advanced him credit, and free of charge at that, pour le roi de Prusse. Voilà tout. No matter that for the worker the exchange between capital and labour, whose result is the price of labour, is a simple exchange; as far as the capitalist is concerned, it has to be a not-exchange. He has to obtain more value than he gives. Looked at from the capitalists’ side, the exchange must be only apparent; i.e. must belong to an economic category other than exchange, or capital as capital and labour as labour in opposition to it would be impossible. They would be exchanged for one another only as identical exchange values existing in different material modes. – Thus the economists take refuge in this simple process in order to construct a legitimation, an apology for capital by explaining it with the aid of the very process which makes its existence impossible. In order to demonstrate it, they demonstrate it away. You pay me for my labour, you exchange it for its product and deduct from my pay the value of the raw material and instrument which you have furnished. That means we are partners who bring different elements into the process of production and exchange according to their values. Thus the product is transformed into money, and the money is divided in such a way that you, the capitalist, obtain the price of your raw material and your instrument, while I, the worker, obtain the price which my labour added to them. The benefit for you is that you now possess raw material and instrument in a form in which they are capable of being consumed (circulated); for me, that my labour has realized itself [sich verwertet]. Of course, you would soon be in the situation of having eaten up all your capital in the form of money, whereas I, as worker, would enter into the possession of both.

What the worker exchanges with capital is his labour itself (the capacity of disposing over it); he divests himself of it [entäussert sie]. What he obtains as price is the value of this divestiture [Entäusserung]. He exchanges value-positing activity for a predetermined value, regardless of the result of his activity. Now how is its value determined? By the objectified labour contained in his commodity. This commodity exists in his vitality. In order to maintain this from one day to the next – we are not yet dealing with the working class, i.e. the replacement for wear and tear so that it can maintain itself as a class, since the worker here confronts capital as a worker, i.e. as a presupposed perennial subject [Subjekt], and not yet as a mortal individual of the working species – he has to consume a certain quantity of food, to replace his used-up blood etc. He receives no more than an equivalent. Thus tomorrow, after the completed exchange – and only after he has formally completed the exchange does he execute it in the process of production – his labouring capacity exists in the same mode as before: he has received an exact equivalent, because the price which he has obtained leaves him in possession of the same exchange value he had before. Capital has paid him the amount of objectified labour contained in his vital forces. Capital has consumed it, and because it did not exist as a thing, but as the capacity of a living being, the worker can, owing to the specific nature of his commodity – the specific nature of the life process – resume the exchange anew. Since we are dealing here not with any particularly qualified labour but with labour in general, simple labour, we are here not yet concerned with the fact that there is more labour objectified in his immediate existence than is contained in his mere vitality – i.e. the labour time necessary to pay for the products necessary to maintain his vitality – namely the values he has consumed in order to produce a specific labouring capacity, a special skill – and the value of these shows itself in the costs necessary to produce a similar labouring skill.

If one day’s work were necessary in order to keep one worker alive for one day, then capital would not exist, because the working day would then exchange for its own product, so that capital could not realize itself and hence could not maintain itself as capital. The self-preservation of capital is its self-realization. If capital also had to work in order to live, then it would not maintain itself as capital but as labour. Property in raw materials and instruments of labour would be merely nominal; economically they would belong to the worker as much as to the capitalist, since they would create value for the capitalist only in so far as he himself were a worker. He would relate to them therefore not as capital, but as simple material and means of labour, like the worker himself does in the production process. If, however, only half a working day is necessary in order to keep one worker alive one whole day, then the surplus value of the product is self-evident, because the capitalist has paid the price of only half a working day but has obtained a whole day objectified in the product; thus has exchanged nothing for the second half of the work day. The only thing which can make him into a capitalist is not exchange, but rather a process through which he obtains objectified labour time, i.e. value, without exchange. Half the working day costs capital nothing; it thus obtains a value for which it has given no equivalent. And the multiplication of values can take place only if a value in excess of the equivalent has been obtained, hence created.

Surplus value in general is value in excess of the equivalent. The equivalent, by definition, is only the identity of value with itself. Hence surplus value can never sprout out of the equivalent; nor can it do so originally out of circulation; it has to arise from the production process of capital itself. The matter can also be expressed in this way: if the worker needs only half a working day in order to live a whole day, then, in order to keep alive as a worker, he needs to work only half a day. The second half of the labour day is forced labour; surplus-labour. What appears as surplus value on capital’s side appears identically on the worker’s side as surplus labour in excess of his requirements as worker, hence in excess of his immediate requirements for keeping himself alive. The great historic quality of capital is to create this surplus labour, superfluous labour from the standpoint of mere use value, mere subsistence; and its historic destiny [Bestimmung] is fulfilled as soon as, on one side, there has been such a development of needs that surplus labour above and beyond necessity has itself become a general need arising out of individual needs themselves – and, on the other side, when the severe discipline of capital, acting on succeeding generations [Geschlechter], has developed general industriousness as the general property of the new species [Geschlecht] – and, finally, when the development of the productive powers of labour, which capital incessantly whips onward with its unlimited mania for wealth, and of the sole conditions in which this mania can be realized, have flourished to the stage where the possession and preservation of general wealth require a lesser labour time of society as a whole, and where the labouring society relates scientifically to the process of its progressive reproduction, its reproduction in a constantly greater abundance; hence where labour in which a human being does what a thing could do has ceased. Accordingly, capital and labour relate to each other here like money and commodity; the former is the general form of wealth, the other only the substance destined for immediate consumption. Capital’s ceaseless striving towards the general form of wealth drives labour beyond the limits of its natural paltriness [Naturbedürftigkeit], and thus creates the material elements for the development of the rich individuality which is as all-sided in its production as in its consumption, and whose labour also therefore appears no longer as labour, but as the full development of activity itself, in which natural necessity in its direct form has disappeared; because a historically created need has taken the place of the natural one. This is why capital is productive; i.e. an essential relation for the development of the social productive forces. It ceases to exist as such only where the development of these productive forces themselves encounters its barrier in capital itself.

The Times of November 1857 contains an utterly delightful cry of outrage on the part of a West-Indian plantation owner. This advocate analyses with great moral indignation – as a plea for the re-introduction of Negro slavery – how the Quashees (the free blacks of Jamaica) content themselves with producing only what is strictly necessary for their own consumption, and, alongside this ‘use value’, regard loafing (indulgence and idleness) as the real luxury good; how they do not care a damn for the sugar and the fixed capital invested in the plantations, but rather observe the planters’ impending bankruptcy with an ironic grin of malicious pleasure, and even exploit their acquired Christianity as an embellishment for this mood of malicious glee and indolence. They have ceased to be slaves, but not in order to become wage labourers, but, instead, self-sustaining peasants working for their own consumption. As far as they are concerned, capital does not exist as capital, because autonomous wealth as such can exist only either on the basis of direct forced labour, slavery, or indirect forced labour, wage labour. Wealth confronts direct forced labour not as capital, but rather as relation of domination [Herrschaftsverhältnis]; thus, the relation of domination is the only thing which is reproduced on this basis, for which wealth itself has value only as gratification, not as wealth itself, and which can therefore never create general industriousness. (We shall return to this relation of slavery and wage labour.)

Surplus value. Ricardo. Physiocrats. A. Smith. Ricardo

The difficulty of grasping the creation of value shows itself (1) in those modern English economists who accuse Ricardo of not having understood the surplus, the surplus value (see Malthus on value, who at least tries to proceed scientifically), whereas, among all the economists, Ricardo alone understood it, as is demonstrated by his polemic against A. Smith’s confusion of the determination of value by wages and by the labour time objectified in the commodity. The newcomers are just plain simpletons. However, Ricardo himself often gets into confusion, because, although he well understands that the creation of surplus value is the presupposition of capital, he often goes astray in conceiving the multiplication of values on any basis other than the investment of additional objectified labour time in the same product, in other words, on any basis other than when production becomes more difficult. Hence the absolute antithesis in his thinking between value and wealth. Hence the one-sidedness of his theory of ground rent; his erroneous theory of international trade, which is supposed to produce only use value (which he calls wealth), not exchange value. The only avenue for the increase of values as such, apart from the growing difficulty of production (theory of rent), remains population growth (the natural increase among workers resulting from the growth of capital), although he himself never plainly summarized this relation. The basic mistake, that he never investigates where actually the distinction between the determination of value by wages and that by objectified labour comes from. Money and exchange itself (circulation) therefore appear only as purely formal elements in his economics; and although, according to him, economics is concerned only with exchange value, profit etc. appears there only as a percentage share of the product, which happens just as much on the basis of slavery. He never investigated the form of the mediation.

(2) The Physiocrats. Here the difficulty of grasping capital, the self-realization of value, hence the surplus value created by capital in the act of production, presents itself in tangible form, and this was necessarily so among the fathers of modern economics, just as was the case with the creation of surplus value in Ricardo, which he conceives in the form of rent, during the final classical conclusion of this economics. It is at bottom the question of the concept of capital and of wage labour, and therefore the fundamental question which presents itself at the threshold of the system of modern society. The Monetary System had understood the autonomy of value only in the form in which it arose from simple circulation – money; it therefore made this abstract form of wealth into the exclusive object [Objekt] of nations which were just then entering into the period in which the gaining of wealth as such appeared as the aim of society itself. Then came the Mercantile System, an epoch where industrial capital and hence wage labour arose in manufactures, and developed in antithesis to and at the expense of non-industrial wealth, of feudal landed property. [The Mercantilists] already have faint notions of money as capital, but actually again only in the form of money, of the circulation of mercantile capital, of capital which transforms itself into money. Industrial capital has value for them, even the highest value – as a means, not as wealth itself in its productive process – because it creates mercantile capital and the latter, via circulation, becomes money. Labour in manufactures – i.e. at bottom industrial labour, but agricultural labour was and appeared to them, in antithesis, as chiefly productive of use values; raw products, processed, are more valuable, because in a clearer form, likewise more suitable for circulation, commerce; creating more money for the mercantile form (in this regard the historic view of wealth of non-agricultural peoples such as Holland, for example, in antithesis to that of the agricultural, feudal; agriculture did not appear at all in industrial form, but in feudal, hence as source of feudal, not of bourgeois wealth). Thus one form of wage labour, the industrial, and one form of capital, the industrial, were recognized as sources of wealth, but only in so far as they produced money. Exchange value itself therefore not yet conceived in the form of capital. Now the Physiocrats. They distinguish between capital and money, and conceive it in its general form as autonomous exchange value which preserves and increases itself in and through production. They also therefore examine the relation for itself, not merely as a moment of simple circulation, but rather as its presupposition which constantly rises out of it to become its presupposition again. They are therefore the fathers of modern economics. They also understand that the creation of surplus value by wage labour is the self-realization [Selbstverwertung], i.e. the realization [Verwirklichung] of capital. But how does labour act as a means to produce a surplus value out of capital, i.e. already-present value? Here they let the form drop altogether and only look at the simple production process. Hence only that labour can be productive which takes place in the kind of field where the natural force of the instrument of labour tangibly permits the labourer to produce more value than he consumes. Surplus value therefore does not arise from labour as such, but rather from the natural forces which labour uses and conducts – agriculture. This is therefore the only productive labour, for they have come so far that [they consider that] only labour which creates surplus value is productive (that surplus value has to express itself in a material product is a crude view which still occurs in A. Smith. Actors are productive workers, not in so far as they produce a play, but in so far as they increase their employer’s wealth. But what sort of labour takes place, hence in what form labour materializes itself, is absolutely irrelevant for this relation. It is not irrelevant, again, from later points of view); but this surplus value surreptitiously transforms itself into a quantity of use value coming out of production, larger than that which is consumed in it. This multiplication of use values, the excess of the product above that which has to serve as a means for new production – of which a part can therefore be consumed unproductively – appears tangibly only in the relation between the natural seed and its product. Only a part of the harvest has to be directly returned to the soil as seed; products found in nature, the elements air, water, earth, light, and added substances such as fertilizer, then recreate the seed again in multiplied quantity as grain etc. In short, human labour has only to conduct the chemical processes (in agriculture), and in part also to promote them mechanically, or promote the reproduction of life itself (cattle-raising) in order to obtain the surplus, i.e. to transform the identical natural substances from a useless into a valuable form. An over-abundance of agricultural products (grain, cattle, raw materials) is therefore the true form of general wealth. From the economic viewpoint, therefore, rent is the only form of wealth. Thus it is that the first prophets of capital conceive only the not-capitalists, the feudal landed proprietors, as the representatives of bourgeois wealth. The consequence, the levy of all taxes on rent, is then, however, entirely to the advantage of bourgeois capital. The bourgeois glorify feudalism in theory – many a feudal figure, like the elder Mirabeau has been duped by this – only in order to ruin it in actual practice. All other values merely represent raw material + labour; labour itself represents grain or other products of the soil, which labour consumes; hence the factory worker etc. adds no more to the raw material than he consumes in raw materials. Therefore, his labour as well as his employer create no additional wealth – wealth being the surplus above the commodities consumed in production – but merely give it forms more pleasant and useful for consumption. At that time the utilization of natural energy in industry had not developed, nor the division of labour etc. which increases the natural force of labour itself. This was the case, however, in A. Smith’s time. With him, therefore, labour in principle the source of value, likewise of wealth, but actually labour too posits surplus value only in so far as in the division of labour the surplus appears as just as much a gift of nature, a natural force of society, as the soil with the Physiocrats. Hence the weight A. Smith lays on the division of labour. Capital, on the other hand, appears to him – because, although he defines labour as productive of value, he conceives it as use value, as productivity for-itself [für sich seiend], as human natural force in general (this distinguishes him from the Physiocrats), but not as wage labour, not in its specific character as form in antithesis to capital – not as that which contains wage labour as its internal contradiction from its origin, but rather in the form in which it emerges from circulation, as money, and is therefore created out of circulation, by saving. Thus capital does not originally realize itself – precisely because the appropriation of alien labour [fremde Arbeit] is not itself included in its concept. Capital appears only afterwards, after already having been presupposed as capital – a vicious circle – as command over alien labour. Thus, according to A. Smith, labour should actually have its own product for wages, wages should be = to the product, hence labour should not be wage labour and capital not capital. Therefore, in order to introduce profit and rent as original elements of the cost of production, i.e. in order to get a surplus value out of the capitalist production process, he presupposes them, in the clumsiest fashion. The capitalist does not want to give the use of his capital for nothing; the landowner, similarly, does not want to give land and soil over to production for nothing. They want something in return. This is the way in which they are introduced, with their demands, as historical facts, but not explained. Wages are actually the only economically justifiable, because necessary, element of production costs. Profit and rent are only deductions from wages, arbitrarily wrested by force in the historical process by capital and landed property, and justified by law, not economically. But on the other side, since he [Adam Smith] then confronts labour with the means and materials of production in the form of landed property and capital, as independent entities, he has essentially posited labour as wage labour. Therefore contradictions. Hence his vacillation in the determination of value; the placing of profit and ground rent on the same level; erroneous views about the influence of wages on prices etc. Now Ricardo (see 1). With him, however, wage labour and capital are again conceived as a natural, not as a historically specific social form [Gesellschaftsform] for the creation of wealth as use value; i.e. their form as such, precisely because it is natural, is irrelevant, and is not conceived in its specific relation to the form of wealth, just as wealth itself, in its exchange-value form, appears as a merely formal mediation of its material composition; thus the specific character of bourgeois wealth is not grasped – precisely because it appears there as the adequate form of wealth as such, and thus, although exchange value is the point of departure, the specific economic forms of exchange themselves play no role at all in his economics. Instead, he always speaks about distribution of the general product of labour and of the soil among the three classes, as if the form of wealth based on exchange value were concerned only with use value, and as if exchange value were merely a ceremonial form, which vanishes in Ricardo just as money as medium of circulation vanishes in exchange. Therefore, in order to bring out the true laws of economics, he likes to refer to this relation of money as a merely formal one. Hence also his weakness in the doctrine of money proper.

The exact development of the concept of capital [is] necessary, since it [is] the fundamental concept of modern economics, just as capital itself, whose abstract, reflected image [is] its concept [dessen abstraktes Gegenbild sein Begriff], [is] the foundation of bourgeois society. The sharp formulation of the basic presuppositions of the relation must bring out all the contradictions of bourgeois production, as well as the boundary where it drives beyond itself.

<It is important to note that wealth as such, i.e. bourgeois wealth, is always expressed to the highest power as exchange value, where it is posited as mediator, as the mediation of the extremes of exchange value and use value themselves. This intermediary situation [Mitte] always appears as the economic relation in its completeness, because it comprises the opposed poles, and ultimately always appears as a one-sidedly higher power vis-à-vis the extremes themselves; because the movement, or the relation, which originally appears as mediatory between the extremes necessarily develops dialectically to where it appears as mediation with itself, as the subject [Subjekt] for whom the extremes are merely its moments, whose autonomous presupposition it suspends in order to posit itself, through their suspension, as that which alone is autonomous. Thus, in the religious sphere, Christ, the mediator between God and humanity – a mere instrument of circulation between the two – becomes their unity, God-man, and, as such, becomes more important than God; the saints more important than Christ; the popes more important than the saints. Where it is posited as middle link, exchange value is always the total economic expression, itself one-sided against the extremes; e.g. money in simple circulation; capital itself as mediator between production and circulation. Within capital itself, one form of it in turn takes up the position of use value against the other as exchange value. Thus e.g. does industrial capital appear as producer as against the merchant, who appears as circulation. Thus the former represents the material [stofflich], the latter the formal side, i.e. wealth as wealth. At the same time, mercantile capital is itself in turn the mediator between production (industrial capital) and circulation (the consuming public) or between exchange value and use value, where both sides are posited alternately, production as money and circulation as use value (consuming public) or the former as use value (product) and the latter as exchange value (money). Similarly within commerce itself: the wholesaler as mediator between manufacturer and retailer, or between manufacturer and agriculturalist, or between different manufacturers; he is the same mediator at a higher level. And in turn, in the same way, the commodity brokers as against the wholesalers. Then the banker as against the industrialists and merchants; the joint-stock company as against simple production; the financier as mediator between the state and bourgeois society, on the highest level. Wealth as such presents itself more distinctly and broadly the further it is removed from direct production and is itself mediated between poles, each of which, considered for itself, is already posited as economic form. Money becomes an end rather than a means; and the higher form of mediation, as capital, everywhere posits the lower as itself, in turn, labour, as merely a source of surplus value. For example, the bill-broker, banker etc. as against the manufacturers and farmers, which are posited in relation to him in the role of labour (of use value); while he posits himself toward them as capital, extraction of surplus value; the wildest form of this, the financier.>

Capital is direct unity of product and money or, better, of production and circulation. Thus it itself is again something immediate, and its development consists of positing and suspending itself as this unity – which is posited as a specific and therefore simple relation. The unity at first appears in capital as something simple.

<Ricardo’s reasoning is simply this: products are exchanged for one another – hence capital for capital – according to the amounts of objectified labour contained in them. A day’s work is always exchanged for a day’s work. This is presupposition. Exchange itself can therefore be entirely left out. The product – capital posited as product – is exchange value in itself, to which exchange merely adds form; formal form with him. The only question is now in what proportions this product is divided up and distributed. Whether these proportions are regarded as specific quotas of the presupposed exchange value, or of its content, material wealth, [is] the same thing. Moreover, since exchange as such is merely circulation – money as circulation – it is better to abstract from it altogether, and to examine only the proportions of material wealth which have been distributed within the production process or because of it to the various factors. In the exchange form, all value etc. is merely nominal; it is real only in the form of the proportion. Exchange as a whole, to the extent that it creates no greater material variety, is nominal. Since a full day’s work is always exchanged for a full day’s work, the sum of values remains the same – the growth in the forces of production affects only the content of wealth, not its form. An increase of values can arise, therefore, only out of an increasing difficulty in production – and this can take place only where the forces of nature no longer afford an equal service to equal quantities of human labour, i.e. where the fertility of the natural elements decreases – in agriculture. The decline of profits is therefore caused by rent. Firstly the false presupposition that a full day’s work is always worked in all social conditions; etc. etc. (see above).>

Surplus value and productive force. Relation when these increase. – Result. – Productive force of labour is productive force of capital. – In proportion as necessary labour is already diminished, the realization of capital becomes more difficult

We have seen: The worker needs to work only e.g. half a working day in order to live a whole one; and hence to be able to begin the same process again the next day. Only half a day’s work is objectified in his labouring capacity – to the extent that it exists in him as someone alive, or as a living instrument of labour. The worker’s entire living day (day of life) is the static result, the objectification of half a day’s work. By appropriating the entire day’s work and then consuming it in the production process with the materials of which his capital consists, but by giving in exchange only the labour objectified in the worker – i.e. half a day’s work – the capitalist creates the surplus value of his capital; in this case, half a day of objectified labour. Now suppose that the productive powers of labour double, i.e. that the same labour creates double the use value in the same time. (For the moment, use value is defined in the present relation as only that which the worker consumes in order to stay alive as a worker; the quantity of the means of life for which, through the mediation of money, he exchanges the labour objectified in his living labouring capacity.) The worker would then have to work only 1/4 day in order to live a full day; the capitalist then needs to give the worker only 1/4 day’s objectified labour in exchange, in order to increase his surplus value in the production process from 1/2 to 3/4; so that he would gain 3/4 day’s objectified labour instead of 1/2. At the end of the production process, the value of the capital would have risen by 3/4 instead of by 2/4. Thus the capitalist would have to make the workers work only 3/4 day, in order to add the same surplus value – that of 1/2 or 2/4 objectified labour – to his capital. However, as representative of the general form of wealth – money – capital is the endless and limitless drive to go beyond its limiting barrier. Every boundary [Grenze] is and has to be a barrier [Schranke] for it. Else it would cease to be capital – money as self-reproductive. If ever it perceived a certain boundary not as a barrier, but became comfortable within it as a boundary, it would itself have declined from exchange value to use value, from the general form of wealth to a specific, substantial mode of the same. Capital as such creates a specific surplus value because it cannot create an infinite one all at once; but it is the constant movement to create more of the same. The quantitative boundary of the surplus value appears to it as a mere natural barrier, as a necessity which it constantly tries to violate and beyond which it constantly seeks to go. Therefore (quite apart from the factors entering in later, competition, prices etc.) the capitalist will make the worker work not only 3/4 day, because the 3/4 day bring him the same surplus value as the whole day did before, but rather he will make him work the full day; and the increase in the productive force which allows the worker to work for 1/4 day and live a whole day now expresses itself simply in that he now has to work 3/4 day for capital, whereas before he worked for it only 2/4 day. The increased productive force of his labour, to the extent that it is a shortening of the time required to replace the labour objectified in him (for use value, subsistence), appears as a lengthening of the time he labours for the realization of capital (for exchange value). From the worker’s standpoint, he now has to do a surplus labour of 3/4 day in order to live a full day, while before he only had to do a surplus labour of 2/4 day. The increase, the doubling of the productive force, has increased his surplus labour by 1/4 [day]. One remark here: the productive force has doubled, the surplus labour the worker has to do has not doubled, but has only grown by 1/4 [day]; nor has capital’s surplus value doubled; but it, too, has grown by only 1/4 [day]. This shows, then, that surplus labour (from the worker’s standpoint) or surplus value (from capital’s standpoint) does not grow in the same numerical proportion as the productive force. Why? The doubling in the productive force is the reduction of necessary labour (for the worker) by 1/4 [day], hence also the [increase of the] production of surplus value by 1/4, because the original relation was posited as 1/2. If the worker had to work, originally, 2/3 day in order to live one full day, then the surplus value would have been 1/3, and the surplus labour the same. The doubling in the productive force of labour would then have enabled the worker to restrict his necessary labour to half of 2/3 or 2/(3 × 2), 2/6 or 1/3 day, and the capitalist would have gained 1/3 [day] of value. But the total surplus labour would have become 2/3 [day]. The doubling of the productive force, which resulted in 1/4 [day] surplus value and surplus labour in the first example, would now result in 1/3 [day] surplus value or surplus labour. The multiplier of the productive force – the number by which it is multiplied – is therefore not the multiplier of surplus labour or of surplus value; but rather, if the original relation of the labour objectified in the labour price was 1/2 of the labour objectified in 1 working day, which always appears as the limit, † then the doubling is equal to the division of 1/2 by 2 (in the original relation), i.e. 1/4. If the original relation was 2/3, then the doubling equals the division of 2/3 by 2 = 2/6 or 1/3. The multiplier of the productive force is thus never the multiplier but always the divisor of the original relation, not the multiplier of its numerator but of its denominator. If it were the former, then the multiplication of the productive force would correspond to the multiplication of the surplus value. Instead, the surplus value is always equal to the division of the original relation by the multiplier of the productive force. If the original relation was 8/9, i.e. the worker needs 8/9 of a working day to live, so that capital gains only 1/9 in its exchange with living labour, if surplus labour equals 1/9, then the worker can now live from half of 8/9 of a working day, i.e. with 8/18 = 4/9 (whether we divide the numerator or multiply the denominator the same thing), and the capitalist, who orders a full day’s work, would have a total surplus value of 4/9 working day; subtracting the original surplus value of 1/9 from this leaves 3/9 or 1/3. The doubling of the productive force therefore = here an increase in surplus value or surplus time by 1/3. This is simply because the surplus value is always equal to the relation between the whole working day and that part of the working day necessary to keep the worker alive. The unit in which surplus value is calculated is always a fraction, i.e. the given part of a day which exactly represents the price of labour. If that is = 1/2, then the increase in the productive force = the reduction of necessary labour to 1/4; if it is = 1/3, then reduction of necessary labour to 1/6; hence in the first, the total surplus value = 3/4; in the second = 5/6; the relative surplus value, i.e. relative to that present before, in the first case = 1/4, in the second = 2/6 or 1/3. Therefore the value of capital does not grow in the same proportion as the productive force increases, but in the proportion in which the increase in the productive force, the multiplier of productive force, divides the fraction of the working day which expresses the part of the day belonging to the worker. The extent to which the productive force of labour increases the value of capital thus depends on the original relation between the portion of labour objectified in the worker and his living labour. This portion is always expressed as a fractional part of the whole working day, 1/3, 2/3, etc. The increase in productive force, i.e. its multiplication by a given amount, is equal to a division of the numerator or the multiplication of the denominator of this fraction by the same amount. Thus the largeness or smallness of the increase of value depends not only on the number which expresses the multiplication of the productive force, but equally on the previously given relation which makes up the part of the work day belonging to the price of labour. If this relation is 1/3, then the doubling of the productive force of the working day = a reduction of the same to 1/6; if it is 2/3, then reduction to 2/6. The objectified labour contained in the price of labour is always equal to a fractional part of the whole day; always arithmetically expressed as a fraction; always a relation between numbers, never a simple number. If the productive force doubles, multiplies by 2, then the worker has to work only 1/2 of the previous time in order to get the price of labour out of it; but how much labour time he still needs for this purpose depends on the first, given relation, namely on the time which was required before the increase in productive force. The multiplier of the productive force is the divisor of this original fraction. Value or surplus labour therefore does not increase in the same numerical relation as productive force. If the original relation is 1/2 and the productive force is doubled, then the necessary (for the worker) labour time reduces itself to 1/4 and the surplus value grows by only 1/4. If the productive force is quadrupled, then the original relation becomes 1/8 and the value grows by only 1/8. The value can never be equal to the entire working day; i.e. a certain part of the working day must always be exchanged for the labour objectified in the worker. Surplus value in general is only the relation of living labour to that objectified in the worker; one member of the relation must therefore always remain. A certain relation between increase in productive force and increase of value is already given in the fact that the relation is constant as a relation, although its factors vary. We see therefore, on one side, that relative surplus value is exactly equal to relative surplus labour; if the working day was 1/2 and the productive force doubles, then the part belonging to the worker, necessary labour, reduces itself to 1/4 and the new value is also exactly 1/4; but the total value is now 3/4. While surplus value rose by 1/4, i.e. in the relation of 1:4, the total surplus value = 3/4 = 3:4. Now if we assume that 1/4 was the original necessary working day, and a doubling in productive force took place, then necessary labour is reduced to 1/8 and surplus labour or surplus value exactly = 1/8 = 1:8. The total surplus value by contrast = 7:8. In the first example the original total surplus value = 1:2 (1/2) and then rose to 3:4; in the second case the original total surplus value was 3/4 and has now risen to 7:8 (7/8). In the first case it has grown from 1/2 or 2/4 to 3/4; in the second from 3/4 or 6/8 to 7/8; in the first case by 1/4, in the second by 1/8; i.e. in the first case it rose twice as much as in the second: but in the first case the total surplus value is only 3/4 or 6/8 while it is 7/8 in the second, i.e. 1/8 more.

† Messrs the manufacturers have, however, also prolonged it into the night, ten hours’ bill. See the report of Leonard Horner. The working day itself does not recognize daylight as a limit; it can be lengthened deep into the night; this belongs to the chapter on wages.

Let necessary labour be 1/16, then total surplus value = 15/16; which was 5/8 = 10/16 in the previous relation; thus the total surplus value presupposed is by 5/16 higher than in the previous case. Now let the productive force double, then necessary labour = 1/32; which was previously = 2/32 (1/16); hence surplus time has risen by 1/32, surplus value by the same proportion. As regards the total surplus value, which was 15/16 or 30/32, this is now 31/32. Compared to the earlier relation (where necessary labour was 1/4 or 8/32), the total surplus value is now 31/32, whereas it was only 30/32 earlier, hence grew by 1/32. But regarded relatively, the doubling of production increased it in the first case by 1/8 or 4/32, while it has now increased by only 1/32, i.e. by 3/32 less.

If necessary labour had already been reduced to 1/1,000, then the total surplus value would be = 999/1,000. Now if the productive force increased a thousandfold, then necessary labour would decline to 1/1,000,000 working day and the total surplus value would amount to 999,999/1,000,000 of a working day; whereas before this increase in productive force it amounted to only 999/1,000 or 999,000/1,000,000; it would thus have grown by 999/1,000,000 = 1/11 (with the addition of 1/(11 + 1/999), i.e. the thousandfold increase in productive force would have increased the total surplus by not even 1/11, i.e. not even by 3/33, whereas in the previous case it rose by 1/32 owing to a mere doubling of the productive force. If necessary labour falls from 1/1,000 to 1/1,000,000, then it falls by exactly 999/1,000,000 (for 1/1,000 = 1,000/1,000,000), i.e. by the surplus value.

If we summarize this, we find:

Firstly: The increase in the productive force of living labour increases the value of capital (or diminishes the value of the worker) not because it increases the quantity of products or use values created by the same labour – the productive force of labour is its natural force – but rather because it diminishes necessary labour, hence, in the same relation as it diminishes the former, it creates surplus labour or, what amounts to the same thing, surplus value; because the surplus value which capital obtains through the production process consists only of the excess of surplus labour over necessary labour. The increase in productive force can increase surplus labour – i.e. the excess of labour objectified in capital as product over the labour objectified in the exchange value of the working day – only to the extent that it diminishes the relation of necessary labour to surplus labour, and only in the proportion in which it diminishes this relation. Surplus value is exactly equal to surplus labour; the increase of the one [is] exactly measured by the diminution of necessary labour.

Secondly: The surplus value of capital does not increase as does the multiplier of the productive force, i.e. the amount to which the productive force (posited as unity, as multiplicand) increases; but by the surplus of the fraction of the living work day which originally represents necessary labour, in excess over this same fraction divided by the multiplier of the productive force. Thus if necessary labour = 1/4 of the living work day and the productive force doubles, then the value of capital does not double, but grows by 1/8; which is equal to 1/4 or 2/8 (the original fraction of the work day which represents necessary labour) − 1/4 divided by 2, or = 2/8 minus 1/8 = 1/8. (That value doubles itself can also be expressed, it grows 4/2 [-fold] or 16/8 [-fold]. Its growth would relate to that of the productive force by 1:16. (That is it!) If the fraction was 1/1,000 and the productive force increases a thousandfold, then the value of capital does not grow a thousandfold, but rather by far less than 1/11; it grows by 1/1,000 − 1/1,000,000, i.e. by 1,000/1,000,000 − 1/1,000,000 = 999/1,000,000.)

Thus the absolute sum by which capital increases its value through a given increase of the productive force depends on the given fractional part of the working day, on the fractional part of the working day which represents necessary labour, and which therefore expresses the original relation of necessary labour to the living work day. The increase in productive force in a given relation can therefore increase the value of capital differently e.g. in the different countries. A general increase of productive force in a given relation can increase the value of capital differently in the different branches of industry, and will do so, depending on the different relation of necessary labour to the living work day in these branches. This relation would naturally be the same in all branches of business in a system of free competition, if labour were simple labour everywhere, hence necessary labour the same. (If it represented the same amount of objectified labour.)

Thirdly: The larger the surplus value of capital before the increase of productive force, the larger the amount of presupposed surplus labour or surplus value of capital; or, the smaller the fractional part of the working day which forms the equivalent of the worker, which expresses necessary labour, the smaller is the increase in surplus value which capital obtains from the increase of productive force. Its surplus value rises, but in an ever smaller relation to the development of the productive force. Thus the more developed capital already is, the more surplus labour it has created, the more terribly must it develop the productive force in order to realize itself in only smaller proportion, i.e. to add surplus value – because its barrier always remains the relation between the fractional part of the day which expresses necessary labour, and the entire working day. It can move only within these boundaries. The smaller already the fractional part falling to necessary labour, the greater the surplus labour, the less can any increase in productive force perceptibly diminish necessary labour; since the denominator has grown enormously. The self-realization of capital becomes more difficult to the extent that it has already been realized. The increase of productive force would become irrelevant to capital; realization itself would become irrelevant, because its proportions have become minimal, and it would have ceased to be capital. If necessary labour were 1/1,000 and the productive force tripled, then it would fall to only 1/3,000 or surplus labour would have increased by only 2/3,000. But this happens not because wages have increased or the share of labour in the product, but because it has already fallen so low, regarded in its relation to the product of labour or to the living work day.

(All these statements correct only in this abstraction for the relation from the present standpoint. Additional relations will enter which modify them significantly. The whole, to the extent that it proceeds entirely in generalities, actually already belongs in the doctrine of profit.)

So much in general for the time being: the development of the productive force of labour – first the positing of surplus labour – is a necessary condition for the growth of value or the realization of capital. As the infinite urge to wealth, it strives consistently towards infinite increase of the productive forces of labour and calls them into being. But on the other hand, every increase in the productive force of labour – leaving aside the fact that it increases the use values for the capitalist – is an increase in the productive force of capital and, from the present standpoint, is a productive force of labour only in so far as it is a productive force of capital.

Concerning increases in the value of capital

This much is already clear, can at least be mentioned in anticipation: the increase in the productive force does not in and by itself increase prices. For example the bushel of wheat. If a half of a working day objectifies itself in one bushel of wheat, and if this is the worker’s price, then the surplus labour can only produce 2 bushels of wheat. Thus 2 bushels of wheat [is] the value of one working day, and if that = 26s. in money, = 26s. Each bushel = 13s. Now if the productive force doubles, then the bushel of wheat no more than = 1/4 working day; = 6 1/2s. With the productive force, the price of this fractional part of the commodity fell. But the total price remained; but now a surplus of 3/4 working day. Every fourth = 1 bushel wheat = 6 1/2s. Thus the total product = 26s. = 4 bushels. Same as before. The value of the capital increased from 13s. to 19 1/2s. The value of labour diminished from 13s. to 6 1/2s.; material production rose from 2 bushels to 4. Now 19 1/2. Now, if the force of production were to double also in gold production, so that, if 13s. were the product of half a working day and this half a day were the necessary labour before; now 1/4 [working day] produces 52s. or 52 − 13 = 39s. more. 1 bushel of wheat now = 13s.; the same fractional price afterwards as before; but the total product = 52s.; before only = 26s. On the other hand, the 52s. would now buy 4 bushels, while the 26, earlier, bought only 2.

Well. First of all it is clear that if capital has already raised surplus labour to the point where the entire living work day is consumed in the production process (and we here assume the working day to be the natural amount of labour time which the worker is able to put at the disposal of capital; this is always only for a specific time, i.e. specific labour time), then an increase in the productive force cannot increase labour time, nor, therefore, objectified labour time. The product objectifies one working day, whether the necessary time of labour is represented by 6 or 3 hours, by 1/2 or 1/4 of the working day. The surplus value of capital has grown; i.e. its value relative to the worker – for if it was only = 2/4 before, it is now = to 3/4 of objectified labour time; but its value increased not because the absolute but because the relative amount of labour grew; i.e. the total amount of labour did not grow; the working day is as long before as after; hence no absolute increase in surplus time (surplus labour time); rather the amount of necessary labour decreased, and that is how relative surplus labour increased. The worker in fact worked a whole day before, but only 1/2 day of surplus time; afterwards, as before, he works the whole day, but 3/4 of a day of surplus time. To that extent, therefore, the price (presupposing this as its gold and silver value), or the exchange value of capital, has not increased with the doubling of the productive force. This therefore concerns the rate of profit, not the price of the product or the value of the capital, which became a commodity again in the product. But in fact the absolute values also increase in this manner, because that part of wealth which is posited as capital – as self-realizing value – also increases. (Accumulation of capitals.) Take our earlier example. Let capital = 100 thalers, and let it decompose in the production process into the following parts: 50 thalers cotton, 40 thalers wages, 10 thalers instrument. Assume at the same time, in order to simplify the arithmetic, that the entire instrument of labour is consumed in one act of production (and this is quite beside the point here, so far), so that its entire value would reappear in the form of the product. Suppose in this case that the 40 thalers which go to labour express a labour time objectified in living labouring capacity of, say, 4 hours, giving capital 8 hours. Presupposing the instrument and the raw material, the total product would amount to 100 thalers, if the worker works only 4 hours, i.e. if the raw material and the instrument were his property and he worked for 4 hours only. He would increase the 60 thalers by 40, which he could consume, since firstly he replaces the 60 thalers in raw material and instrument required for production, and then adds a surplus value of 40 thalers as reproduction of his own living labour capacity or of the time objectified in him. He could repeat the work again and again, since he would have reproduced the value of the raw material and of the instrument as well as of the labouring capacity; the latter by constantly increasing the value of the former by 4 hours of objectified labour. But now let him receive the 40 thalers in wages only by working 8 hours, so that he would add to the material and instrument of labour, which now confront him as capital, a surplus value of 80 thalers; while the former surplus value of 40 thalers, which he added, is only exactly the value of his labour. He would thus add a surplus value exactly = to the surplus labour or surplus time. The value of capital would thus have increased from 100 thalers to 140. †

† Assume further that raw material doubles and the instrument of labour (for the sake of simpler arithmetic) increases by one-half. Then capital costs would amount to 100 thalers cotton, 20 thalers instrument, i.e. 120 thalers; for labour, now as then, 40 thalers; altogether 160 thalers. If a surplus labour of 4 hours increases 100 thalers by 40%, then it increases 160 thalers by 64 thalers. Hence the total product = 224 thalers. We here have presupposed, further, that the rate of profit does not vary with the size of capital; and material and instrument of labour are not regarded as being themselves realizations, capitalizations of surplus labour; as we saw, the greater the already posited surplus time, i.e. the size of capital as such, the more is it presupposed that an absolute increase of labour time is impossible, and that a relative increase, resulting from an increase in the productive force, declines in geometric proportion.

Now, capital regarded as simple exchange value would be absolutely greater, 140 thalers instead of 100; but in fact, a new value would merely have been created, i.e. a value which is not merely necessary to replace the 60 thalers in advances for the materials and the instrument of labour and the 40 thalers for labour, a new value of 40 thalers. The values in circulation would have been increased by 80 thalers, by 40 thalers of additional objectified labour time.

Now assume the same presupposition. 100 thalers capital; specifically, 50 for cotton, 40 for labour, 10 for instrument of production; let the surplus labour time remain as before, i.e. 4 hours, and the total labour time 8 hours. Thus in all cases the product only = 8 hours labour time = 140 thalers. Now suppose the productive force of labour doubles; i.e. 2 hours would be enough for the worker to realize raw materials and instrument to the extent required to maintain his labouring capacity. If 40 thalers were an objectified labour time of 4 hours, then 20 thalers would be the objectified labour time of 2 hours. These 20 thalers now express the same use value as the 40 thalers before. The exchange value of labouring capacity has diminished by half, because half of the original labour time creates the same use value, while the exchange value of the use value is measured purely by the labour time objectified in it. But the capitalist makes the workers work 8 hours now as before, and his product therefore represents now as before a labour time of 8 hours = 80 thalers of labour time, while the value of raw material and material remain the same, namely 60 thalers; altogether, as before, 140 thalers. (In order to live, the worker himself would have had to add to the 60 thalers of raw material and instrument a value of no more than 20 thalers, he would thus have created a value of only 80 thalers. The total value of his product would have diminished, by the doubling of production, from 100 to 80, by 20 thalers, i.e. by 1/5 of 100 = 20%.) But the surplus time or surplus value for capital is now 6 hours instead of 4, or 60 thalers instead of 40. Its increment is 2 hours, 20 thalers. His accounts would now show the following: for raw material, 50; for labour, 20; for instrument, 10; costs = 80 thalers. Gain = 60 thalers. Now as before he would sell the product for 140 thalers, but would show a gain of 60 thalers instead of 40 as before. On one side, therefore, he throws only the same exchange value into circulation as before, 140 thalers. But the surplus value of his capital has grown by 20 thalers. Accordingly, only the share he gets of the 140 thalers [is] the rate of his profit. The worker in fact worked 2 hours more for him free of charge, i.e. 6 hours instead of 4, and this is the same for him as if he had worked 10 hours instead of 8 in the earlier relation, had increased his absolute labour time. But indeed a new value has arisen also; namely 20 additional thalers are posited as autonomous value, as objectified labour which has become free, unbound from the task of serving only in exchange for earlier labour power [Arbeitskraft]. This can present itself in two ways. Either the 20 thalers set as much additional labour into motion as becomes capital and creates larger exchange value: make more objectified labour into the point of departure for the new production process; or the capitalist exchanges the 20 thalers as money for commodities other than those which he needs in its production as industrial capital; all commodities other than labour and money themselves thus are exchanged for 20 more thalers, for 2 more hours of objectified labour time. Their exchange value has thus increased by just this liberated sum. In fact, 140 thalers are 140 thalers, as the very ‘perceptive’ French publisher of the Physiocrats remarks against Boisguillebert. But it is false that these 140 thalers only represent more use value; they represent a greater amount of independent exchange value, of money, of latent capital; i.e. of wealth posited as wealth. The economists themselves admit this later when they allow the accumulation of capitals to accumulate not only the mass of use values, but that of exchange values too; for, according to Ricardo himself, the element of the accumulation of capitals is posited just as completely with relative surplus labour as with absolute – impossible any other way. On the other side, it is already implicit in the thesis best developed by Ricardo, that these excess 20 thalers, which are created purely by the increase in productive force, can become capital again. Earlier, only 40 of the 140 thalers (leaving capital’s consumption aside for now) could become new capital; 100 do not become capital but remain capital; now 60 [can], i.e. the present capital is greater by an exchange value of 20 thalers. Thus, exchange value, wealth as such, has increased, although the total sum of the same has not directly increased. Why has it increased? Because that part of the total sum has increased which was not a mere medium of circulation, but money; or which was not merely equivalent, but exchange value for-itself [für sich seiend]. Either the liberated 20 thalers were accumulated as money, i.e. added to the stock of exchange values in general (abstract) exchange value form; or they all circulated, and then the prices of the commodities bought with them rise; they all represent more money, as well as, since the production cost of gold has not fallen (rather, risen relative to the commodity produced by the more productive capital), more objectified labour (because of this, the excess production, which at first only appeared on the side of the one producing capital, now appears on the side of the others, which produce the more expensive commodities); or the 20 thalers are directly used up as capital by the originally circulating capital. Thus a new capital of 20 thalers is posited – a sum of self-preserving and self-realizing wealth. Capital has risen by the exchange value of 20 thalers. (Circulation actually does not yet concern us here, since we are here dealing with capital in general, and circulation can only mediate between capital in the form of money and capital in its form as capital; the first capital may realize money as such, i.e. exchange it for commodities, consume more than before; but in the hand of the producer of these commodities this money becomes capital. Thus it becomes capital directly in the hands of the first capital, or, via a detour, [in those] of another capital. But the other capital is always in turn capital as such; and we are concerned here with capital as such, [let us] say the capital of the whole society. The differentiation etc. of capitals does not concern us yet.) In general, these 20 thalers can appear only in a double form. As money, so that capital again exists in the character of money which has not yet become capital – its point of departure; the abstract-autonomous form of exchange value or of general wealth; or itself in turn as capital, as a new domination of objectified labour over living labour. (Every increase in the mass of capital employed can increase the productive force not only at an arithmetical but at a geometrical rate; although it can increase profit at the same time – as increase of productive force – only at a much lower rate. The influence of the increase of capital on the increase of productive force is thus infinitely greater than that of the increase of the productive force on the growth of capital.) As general wealth, materialized in the form of money (of the thing, in its mere abstractness), or of new living labour. The capitalist consumes, say, 20 of the 140 thalers as use values for himself, through the mediation of money as means of circulation. Thus, in the first presupposition, he could begin the process of self-realization only with a larger capital, a larger use value of 120 (as against 100). After the doubling in the productive forces, he can do it with 140 thalers without restricting his consumption. A larger part of the exchange values solidifies as exchange value, instead of vanishing in use value (whether it solidifies as such, through production, directly or indirectly). To create a larger capital means to create a larger exchange value; although exchange value in its direct form as simple exchange value has not been increased by the growth of productivity, it has in its intensified form as capital. This larger capital of 140 thalers represents, absolutely, more objectified labour than the earlier capital of 120 thalers. It therefore also, at least relatively, sets more living labour into motion and therefore also ultimately reproduces more simple exchange value. The capital of 120 thalers at 40% produced a product or simple exchange value of 60 thalers at 40%; the capital of 140 thalers a simple exchange value of 64 thalers. Here, then, the increase in exchange value in the form of capital is still posited directly as an increase in exchange value in its simple form. It is of the highest importance to remember this. It is not enough to say, like Ricardo, that exchange value does not increase; i.e. the abstract form of wealth; but only exchange value as capital. In saying this he is looking only at the original production process. But if relative surplus labour increases – and capital therefore increases absolutely – then there is necessarily also an increase within circulation also of relative exchange value existing as exchange value, money as such, and therefore, through the mediation of the production process, absolute exchange value. In other words, of this same amount of exchange value – or money – and the product of the realization process appears in this simple form – the product is surplus value only relative to capital, to value such as it existed before the production process; for itself, regarded as an independent existence, it is merely quantitatively defined exchange value – a part has become liberated, which does not exist as equivalent for already present exchange values or for already present labour time. If it is exchanged for those already present, it gives them not an equivalent but more than an equivalent, and thus liberates a part of the exchange value on their side. In a static state, this liberated exchange value by which society has become richer can only be money, in which case only the abstract form of wealth has increased; [is] in motion: [it] can realize itself only in new living labour (whether labour which had been dormant is set into motion, or new workers are created (population [growth] is accelerated) or again a new circle of exchange values, of exchange values in circulation, is expanded, which can occur on the production side if the liberated exchange value opens up a new branch of production, i.e. a new object of exchange, objectified labour in the form of a new use value; or the same is achieved when objectified labour is put in the sphere of circulation in a new country, by an expansion of trade). The latter must then be created.

The form in which Ricardo attempts to clarify the matter for himself (and he is very unclear in this regard) says at bottom nothing more than that he just introduces a certain relation, instead of saying, simply, that out of the same sum of simple exchange values a smaller part posits itself in the form of simple exchange value (equivalent) and a larger part in the form of money (money as the original, antediluvian form out of which capital always arises anew; money in its character as money, not as coin etc.); that therefore the part posited as exchange value for-itself, i.e. as value, increases, i.e. wealth in the form of wealth (whereas he comes to just the mistaken conclusion that it increases only in the form of material, physical wealth as use value). The origin of wealth as such, in so far as it arises not from rent, i.e., according to him, not from the increase in productive force, but rather from the decrease of the same, is therefore totally incomprehensible to him, and he entangles himself in the wildest contradictions. Let us take the form of the matter. Capital 1,000 sets 50 workers into motion; or 50 living work days; through a doubling of the productive force, it could set 100 working days into motion. But these latter do not exist in the presupposition, and are introduced arbitrarily, because otherwise – unless more real working days are introduced – he does not grasp the increase in exchange value which arises from increased productivity. At the same time, the growth of population is never developed by him as an element in the increase of exchange values; never clearly and definitely stated. Let the presupposition be capital 1,000 and workers 50. The correct deduction, which he himself also draws (see Notebook) : capital 500 with 25 workers can produce the same use value as before; the other 500 with the other 25 workers establish a new business and likewise produce an exchange value of 500. The profit remains the same, since it arises not from the exchange of 500 for 500, but from the proportions in which profit and wages originally divide in the 500, and since exchange deals in equivalents, which can no more increase value than external trade can, which Ricardo explicitly demonstrates. Since the exchange of equivalents just means nothing more than that the value in the hands of A before the exchange with B still exists in his hands after the exchange with B. The total value or wealth has remained the same. Use value, however, or the material of wealth, has doubled. Now, there is absolutely no reason here why wealth should grow as wealth, exchange value as such – as far as the increase in the productive forces is concerned. If the productive forces again double in both branches, then capital A can again divide into two of 250 with 12 1/2 working days each, capital B can do the same. There are now four capitals with the same total exchange value of £1,000, consuming 50 living work days as before, producing four times as much use value as before the doubling of consumption value. Ricardo is too classical to commit absurdities, like those who claim to improve on him, who derive the larger value after the increase in productive force from one party selling at a higher price within circulation. As soon as the capital of 500 has become commodity, simple exchange value, instead of exchanging it for 500, he exchanges it for 550 (at 10%), but then the other party obviously only gets 450 in exchange value instead of 500 and the total sum remains 1,000 as before. This happens often enough in commerce, but explains the profit made by one capital only by the loss of the other capital, and not the profit of capital; and without this presupposition there can be profit neither on one nor on the other side. Ricardo’s process can therefore go on without any other limit than the increase of the productive force (and this is again physical, located outside the economic relation itself) possible with a capital of 1,000 and 50 workers. See the following passage: ‘Capital is that part of the wealth of a country which is employed with a view to future production, and may be increased in the same manner as wealth.’ (Wealth for him the abundance of use values; and, seen from the standpoint of simple exchange, the identical objectified labour can express itself in limitless use values and constantly remain the same exchange value, as long as it remains the same amount of objectified labour, for its equivalent is measured not by the mass of use value in which it exists, but rather by its own amount.) ‘An additional capital will be equally efficacious in the formation of future wealth, whether it be obtained from improvements of skill or machinery, or from using more revenue productively; for wealth’ (use value) ‘always depends on the quantity of commodities produced’ (also somewhat on their variety, it seems), ‘without regard to the facility with which the instruments employed in production may have been produced’ (i.e. the labour time objectified in them). ‘A certain quantity of clothes and provisions will maintain and employ the same number of men; but they will be of twice the value’ (exchange value) ‘if 200 have been employed on their production.’ If, owing to an increase in the productive force, 100 produce as much in use values as 200 earlier, then: ‘of the 200, half are let go, so that the remaining 100 produce as much as the 200 did before. Thus a half of the capital can be withdrawn from this branch of business; as much capital has become free as labour. And since one half of the capital now does quite the same service as did the whole, two capitals have now been formed etc.’ (cf. 39, 40 ibid. on national trade, to which we must return). Ricardo does not speak here about the working day; [the fact] that, if the capitalist earlier exchanged half of an objectified working day for the worker’s entire living work day, [he] thus at bottom gains only half a living work day, since he gives the other half in objectified form to the worker, and obtains it from him in the living form, i.e. pays the worker a half of the working day, instead of in the form of simultaneous working days, i.e. of different workers; this does not alter the matter, only its expression. Each one of these working days furnishes so much more surplus time. If the capitalist, before, had the working day as limit, he now has 50 working days etc. As has been said, this form does not posit an increase in exchange values with an increase in the number of capitals through productivity, and, according to Ricardo, it would also be possible for the population to fall from, say, 10,000,000 to 10,000, without a decrease in exchange values or the quantity of use values (see conclusion of his book). We are the last to deny that capital contains contradictions. Our purpose, rather, is to develop them fully. But Ricardo does not develop them, but rather shifts them off by considering the value in exchange as indifferent for the formation of wealth. That is to say, he contends that in a society based upon the value of exchange, and wealth resulting from such value, the contradictions to which this form of wealth is driven with the development of productive powers etc. do not exist, and that a progress of value is not necessary in such a society to secure the progress of wealth, consequently that value as the form of wealth does not at all affect that wealth itself and its development, i.e. he regards exchange value as merely formal. Then, however, he remembers (1) that the capitalists are concerned with value, (2) that, historically, with the progress of the productive forces (of international trade too, he should have noted), there is a growth in wealth as such, i.e. the sum of values. Now, how to explain this? Capitals accumulate faster than the population; thus wages rise; thus population; thus grain prices; thus the difficulty of production and hence the exchange values. The latter are then finally reached by a detour. We will here entirely omit the moment of rent, since we are not yet concerned with increased difficulty of production but rather with its opposite, with increase in the productive forces. With the accumulation of capitals, wages rise unless population grows simultaneously; the worker marries, production is spurred on or his children live better, do not die before their time etc. In short, the population grows. Its growth, however, gives rise to competition among the workers, and thereby forces the worker to sell his labour power to the capitalist at its value again, or momentarily even below it. Now the accumulated capital, which has meanwhile grown up more slowly, again has the surplus which it earlier spent in the form of wages, i.e. as coin, in order to buy the use value of labour, available to it in the form of money, in order to realize it as capital in living labour, and, since it now also disposes over a greater amount of working days, its exchange value grows in turn. (Even this not really developed in Ricardo, but mixed up with the theory of rent; since the surplus which capital earlier lost in the form of wages is now lost to it in the form of rent, owing to the growth of population.) But even the growth of population is not really comprehensible in his theory. At no time has he shown that there is an inherent relation between the whole of the labour objectified in capital and the living work day (whether the latter is represented as one working day of 50 × 12 hours, or as 12 hours of labour by 50 workers, is the same thing as far as the relation goes), and that this inherent relation is just the relation between the fractional part of the living work day, or that between the equivalent of the objectified labour with which the worker is paid, and the living working day; where the whole is the day itself, and the inherent relation is the variable relation (the day itself is a constant) between the fractional part of the necessary hours of labour and the hours of surplus labour. And, just because he has not developed this relation, he has also not developed [the point] (which did not concern us up to now, since we were concerned with capital as such and introduced the development of the productive forces as an external relation) that the development of the productive forces itself presupposes both the increase of capital and the increase of simultaneous working days, which, however, within the given barrier of a capital that sets one working day into motion (even if it be a day of 50 × 12 hours, 600 hours), is itself the barrier to the development of its productive force. The wage covers not only the worker, but also his reproduction; so that when this specimen of the working class dies, another replaces it; after the 50 workers are dead, 50 new ones are there to replace them. The 50 workers themselves – as living labour capacities – represent not only the costs of their own production, but also the costs which had to be paid to their parents above and beyond their wages as individuals, in order to replace themselves with 50 new individuals. Thus the population progresses even without a rise in wages. But now, why does it not progress rapidly enough? and why does it need a special stimulus? Surely only because the aim of capital is not served merely by obtaining more ‘wealth’ in the Ricardian sense, but because it wants more value, to command more objectified labour. But indeed, according to him, it can command the latter only if wages fall; i.e. if more living work days are exchanged for the same capital with objectified labour, and hence a greater value is created. In order to make wages fall, he presupposes increase of population. And in order to prove increase of population here, he presupposes that the demand for working days increases, in other words, that capital can buy more objectified labour (objectified in labouring capacity), hence that its value has grown. Originally, however, he proceeded from just the contrary presupposition, and took the detour only because that is where he began. If £1,000 was able to buy 500 working days, and the productive force increases, then either it can proceed to employ the 500 in the same branch of work, or it can divide up and employ 250 in one branch of work, 250 in another, so that this capital splits into 2 capitals of 500 each. But it can never command more than 500 working days, since otherwise, according to Ricardo, not only the use values it produces but also their exchange value must have multiplied itself, the objectified labour time over which it exercises command. Thus, given his presupposition, an increased demand for labour cannot take place. But if it does take place, then capital’s exchange value has grown. Compare Malthus on value, who senses the contradictions, but falls flat when he himself tries to develop them.

Labour does not reproduce the value of the material in which, and of the instrument with which, it works. It preserves their value simply by relating to them in the labour process as to their objective conditions. This animating and preserving force costs capital nothing; appears, rather, as its own force etc.

We have always spoken only about the two elements of capital, the two parts of the living work day, of which one represents wages, the other profit; one, necessary labour, the other, surplus labour. But what about the other two parts of capital, which are realized in the material of labour and the instrument of labour? As far as the simple production process is concerned, labour presupposes the existence of an instrument which facilitates the work, and of a material in which it presents itself, which it forms. This form gives it its use value. This use value becomes exchange value through exchange, to the extent that it contains objectified labour. But are they, as components of capital, values which labour must replace? Thus in the above example (and such objections [were] heaped on Ricardo; that he regarded profit and wages only as components of production costs, not the machine and the material), it seems that if the capital is 100, divided 50 for cotton, 40 for wages, 10 for instrument; and if the wages, of 40 thalers, = 4 hours of objectified labour, and capital orders a working day of 8 hours, then the worker who has to reproduce 40 thalers for wages, 40 thalers surplus time (profit), 10 thalers instrument, 50 thalers cotton = 140 thalers, reproduces only 80 thalers. For 40 thalers are the product of half a working day; 40 are the other, surplus half. But the value of the two other component parts of capital is 60 thalers. Since the worker’s real product is 80 thalers, he can reproduce only 80, not 140. He would have, instead, decreased the value of the 60; since 40 of the 80 [is] replacement for his wages; and the remaining 40 of surplus labour [is] smaller by 20 than 60. Instead of a profit of 40, the capitalist would have a loss of 20 on the part of his original capital consisting of instrument and material. How is the worker supposed to create still another 60 on top of the 80 thalers of value, since one half of his working day, as his wages show, creates only 40 thalers out of the instrument and the material; the other half only the same; and he disposes of only one working day, cannot work two days in one? Suppose the 50 thalers in material = x lb. of cotton yarn; the 10 thalers in instrument = spindle. Now, first, as regards the use value, it is clear that if the cotton did not already have the form of yarn and wood and iron the form of the spindle, then the worker could produce no fabric, no higher use value. For him himself, the 50 thalers and the 10 thalers in the production process are nothing but yarn and spindle, not exchange values. His labour has given them a higher use value, and added objectified labour to the amount of 80 thalers to them, i.e. 40 thalers to reproduce his wages, 40 surplus time. The use value – the fabric – contains one additional working day, half of which, however, replaces only that part of capital for which the disposition over the labouring capacity has been exchanged. The worker has not created the objectified labour contained in yarn and spindle, which form a part of the value of the product; for him they were and remain material to which he gave another form and into which he incorporated new labour. The only condition is that he should not waste them, and this he did not do, in so far as his product has use value, and a higher use value than before. It now contains objectified labour in two parts – his working day, and that already contained in his material, yarn and spindle, independent of him and before him. The previously objectified labour was the condition of his labour; it was necessary to make his labour what it is, costs him no labour. Suppose they were not already presupposed as components of capital, as values, and had cost him nothing. Then the value of the product, if he worked a whole day, would be 80, if a half day, 40 thalers. It would just = one objectified working day. Indeed, they cost him nothing in production; however, this does not destroy the labour time objectified in them, which remains and merely obtains another form. If, in addition to the fabric, the worker also had to create the yarn and the spindle in the same working day, then the process would be in fact impossible. The fact, therefore, that they call for his labour neither as use values in their original form, nor as exchange values, but are on hand, makes it possible for the addition of a working day by him to create a product of a value higher than one working day. He succeeds in this, however, to the extent that he does not have to create this additional part, but rather finds it on hand as material, as presupposition. It can therefore only be said that he reproduces these values in so far as without labour they would rot, be useless; but without them, labour would be equally useless. In so far as the worker reproduces these values, he does so not by giving them a higher exchange value, or entering into any process with their exchange value at all, but merely by subordinating them to the simple production process, merely by working. But this costs him no additional labour time besides what he needs for their processing and higher realization. It is a situation into which capital has put him so that he may work. He reproduces the values only by giving them a higher value, and this giving of a higher value is = his working day. Otherwise he lets them be as they are. That their old value is preserved happens because a new one is added to them, not that the old is itself reproduced, created. In so far as they are products of previous labour, a product of previous labour, a sum of previously objectified labour remains an element of his product, so that the product contains, in addition to its new value, the old as well. He therefore in fact produces in this product only the day’s work which he adds to it, and the preservation of the old value costs him absolutely nothing apart from what it costs him to add the new. For him it is only a material, and remains that no matter how it changes its form; therefore [it is] something present independently of his labour. That this material, which remains that, since it only obtains a different form, itself already contains labour time is the business of capital, not his own; similarly, it is independent of his labour and continues on after it, just as it existed before it. This so-called reproduction costs him no labour time, but is rather the condition of his labour time, since it is nothing more than positing the substance on hand as the material of his labour, relating to it as material. He therefore replaces the old labour time by the act of working itself, not by the addition of special labour time for this purpose. He replaces it simply by the addition of the new, by means of which the old is preserved in the product and becomes an element of a new product. Thus the worker in his working day does not replace the raw material and the instrument in so far as they are values. The capitalist thus obtains this preservation of the old value just as free of charge as he obtains surplus labour. But he obtains it free of charge, because it costs the worker nothing, and is, instead, the result of the fact that the material and the instrument of labour are already in his hands as presupposition, and the worker cannot work, therefore, without making this already objectified labour, now in the hands of capital, into the material of his own labour, thereby also preserving the labour objectified in this material. The capitalist, then, pays the worker nothing for the fact that the yarn and the spindle – their value – reappear, as far as their value is concerned, in the fabric, and are thus preserved. This preservation takes place simply by the addition of new labour, which adds a higher value. What arises from the original relation between capital and labour, then, is that the same service which living labour as living labour performs for objectified labour costs capital nothing, just as it costs the worker nothing, but merely expresses the relation that the material and the instrument of labour confront the worker as capital, as presuppositions independent of him. The preservation of the old value is not a separate act from the addition of the new, but happens by itself; appears as a natural result of the same. But the fact that this preservation costs capital nothing and costs the worker nothing either is already posited in the relation of capital and labour, which in itself is already the former’s profit and the latter’s wage.

The individual capitalist may imagine (and for his accounts it serves as well) that, if he owns a capital of 100 thalers, 50 thalers in cotton, 40 thalers to buy labour with, 10 thalers in instrument, plus a profit of 10% counted as part of his production costs, then labour has to replace his 50 thalers of cotton, 40 thalers subsistence, 10 thalers instrument plus 10% of 50, of 40 and of 10; so that in his imagination, labour creates 55 thalers of raw material, 44 thalers subsistence and 11 thalers instrument for him, together = 110. But this is a peculiar notion for economists, even though it has been advanced with great pomp as an innovation against Ricardo. If the worker’s working day = 10 hours, and if he can create 40 thalers in 8 hours, i.e. can create his wage, or, what is the same, can maintain and replace his labour capacity, then he needs 4/5 of a day in order to replace his wages for capital, and he gives capital 1/5 in surplus labour, or 10 thalers. In exchange for the 40 thalers in wages, for 8 hours of objectified labour, therefore, capital obtains 10 hours of living labour, and this excess constitutes the entirety of its profit. The total objectified labour which the worker has created, then, is 50 thalers, and, regardless of the costs of the instrument and of the raw materials, more he cannot add, for his day cannot objectify itself in more labour than that; now, the fact that he adds these 50 thalers – 10 hours of labour (of which only 8 replace the wage) – to the 60 thalers contained in raw material and instrument – and thereby has simultaneously preserved the raw material and the instrument – they are preserved just by coming into contact again with living labour, and being used as instrument and as material – this costs him no labour (and he would have no time available in which to do this), nor does the capitalist pay him for it. Like every other natural or social power of labour unless it is the product of previous labour, or of such previous labour as does not need to be repeated (e.g. the historical development of the worker etc.), this natural animating power of labour – namely that, by using the material and instrument, it preserves them in one or another form, including the labour objectified in them, their exchange value – becomes a power of capital, not of labour. Hence not paid for by capital. As little as the worker is paid for the fact that he can think etc.

We have seen the original presupposition of the coming into being of capital is the existence of money as money, i.e. as money which has withdrawn from circulation and asserts itself negatively towards it, i.e. value which has become independent from and against circulation – i.e. the commodity for which the character of exchange value is not merely a formal, vanishing character, [which it possesses only] before being exchanged for another use value and finally disappearing as an object of consumption. On the other side, money (in its third, adequate form) – as value which no longer enters circulation as equivalent, but is not yet potentiated as capital, i.e. value independent of and relating negatively against circulation – is at the same time the result of capital’s product, in so far as that product is not merely its own reproduction (but this reproduction is merely formal, since, of the three parts of its value, only one is really consumed and hence reproduced, namely that which replaces wages; profit, on the other hand, is not reproduction but addition of value, surplus value). Just as money at first appeared as the presupposition, the cause of capital, so it now appears as its effect. In the first movement, money arose out of simple circulation; in the second it arises from the production process of capital. In the first, it makes a transition to capital; in the second it appears as a presupposition of capital posited by capital itself; and is therefore already posited as capital in itself [an sich], already contains the ideal relation towards capital. It does not simply make a transition to capital, but rather, as money, its potential to be transformed into capital is already posited in it.

Absolute surplus labour time. Relative. – It is not the quantity of living labour, but rather its quality as labour which simultaneously preserves the labour time already contained in the material etc. – The change of form and substance in the direct production process. – The preservation of the previous stage of production by the subsequent one is contained in the simple production process etc. – Preservation of the old use value by new labour etc. – Process of production and process of realization. The quantity of objectified labour is preserved because contact with living labour preserves its quality as use value for new labour. – In the real production process, the separation of labour from its objective conditions of existence is suspended. But in this process labour already incorporated in capital etc. Appears as capital’s power of self-preservation. Eternalization of value

The increase of values is therefore the result of the self-realization of capital; [regardless of] whether this self-realization is the result of absolute surplus time or of relative, i.e. of a real increase in absolute labour time or of an increase in relative surplus labour, i.e. of a decrease in the fractional part of the working day which is required as labour time necessary to preserve the labouring capacity, as necessary labour in general.

Living labour time reproduces nothing more than that part of objectified labour time (of capital) which appears as an equivalent for the power of disposition over living labour capacity, and which, therefore, as an equivalent, must replace the labour time objectified in this labouring capacity, i.e. replace the production costs of the living labour capacities, in other words, must keep the workers alive as workers. What it produces in addition to that is not reproduction but rather new creation, and, more specifically, creation of new values, because it is the objectification of new labour time in a use value. That the labour time contained in the raw material and instrument is preserved at the same time is a result not of the quantity of labour, but of its quality of being labour as such; and there is no special payment for this, its general quality, for the fact that labour, as labour, is labour – leaving aside all special qualifications, all specific kinds of labour – because capital has bought this quality as part of its exchange with the worker.

But the equivalent for this quality (for the specific use value of labour) is measured simply by the quantity of labour time which has produced it. Initially the worker’s use of the instrument as an instrument, and his shaping of the raw material, adds to the value of the raw material and of the instrument as much new form as is = to the labour time contained in his own wage; what he adds additionally is surplus labour time, surplus value. For their part, the raw materials and the instrument are preserved not in their form but in their substance, through the simple relation of being used as instrument and being posited as the raw material of labour, the simple process of coming into contact with labour, being posited as its means and object and therefore as objectification of living labour, moments of labour itself; and, viewed economically, their substance is objectified labour time. By being posited as a material mode of existence – means and end [Objekt] – of living labour, objectified labour time ceases to exist in a one-sided, objective form, in which, as a mere thing, it is at the prey of processes of chemical decay etc. There is an indifference on the part of the substance [Stoff] towards the form, which develops out of merely objectified labour time, in whose objective existence labour has become merely the vanished, external form of its natural substance, existing merely in the external form of the substantial [das Stoffliche] (e.g. the form of the table for wood, or the form of the cylinder for iron); no immanent law of reproduction maintains this form in the way in which the tree, for example, maintains its form as a tree (wood maintains itself in the specific form of the tree because this form is a form of the wood; while the form of the table is accidental for wood, and not the intrinsic form of its substance); it exists only as a form external to the substance, or it exists only as a substance [stofflich]. The dissolution to which its substance is prey therefore dissolves the form as well. However, when they are posited as conditions of living labour, they are themselves reanimated. Objectified labour ceases to exist in a dead state as an external, indifferent form on the substance, because it is itself again posited as a moment of living labour; as a relation of living labour to itself in an objective material, as the objectivity of living labour (as means and end [Objekt]) (the objective conditions of living labour). The transformation of the material by living labour, by the realization of living labour in the material – a transformation which, as purpose, determines labour and is its purposeful activation (a transformation which does not only posit the form as external to the inanimate object, as a mere vanishing image of its material consistency) – thus preserves the material in a definite form, and subjugates the transformation of the material to the purpose of labour. Labour is the living, form-giving fire; it is the transitoriness of things, their temporality, as their formation by living time. In the simple production process – leaving aside the realization process – the transitoriness of the forms of things is used to posit their usefulness. When cotton becomes yarn, yarn becomes fabric, fabric becomes printed etc. or dyed etc. fabric, and this becomes, say, a garment, then (1) the substance of cotton has preserved itself in all these forms. (The chemical process, regulated by labour, has everywhere consisted of an exchange of (natural) equivalents etc.); (2) in each of these subsequent processes, the material has obtained a more useful form, a form making it more appropriate to consumption; until it has obtained at the end the form in which it can directly become an object of consumption, when, therefore, the consumption of the material and the suspension of its form satisfies a human need, and its transformation is the same as its use. The substance of cotton preserves itself in all of these processes; it becomes extinct in one form of use value in order to make way for a higher one, until the object is in being as an object of direct consumption. But when cotton is posited, say, as twist, then it is posited in a specific relation to a further kind of labour. If this labour were not to take place, then not only has the form been posited in it uselessly, i.e. the previous labour is not reaffirmed by new labour, but the material is also spoiled, because, in the form of twist, it has a use value only in so far as it is worked on further: it is a use value only in respect of the use which further labour makes of it; is use value only in so far as its form as twist is suspended in the form of fabric; while cotton in its existence as cotton is capable of an infinite number of useful employments. Thus, without further labour, the use value of cotton and twist, material and form, would be botched; it would be destroyed instead of produced. Material as well as form, substance like form, are preserved by further labour – preserved as use value, until they obtain the form of use value as such, whose use is consumption. It is therefore already a part of the simple production process that the earlier stage of production is preserved by the later, and that positing the higher use value preserves the old, or, the old use value is transformed only to the extent that it is raised to a higher use value. It is living labour which preserves the use value of the incomplete product of labour by making it the material of further labour. It preserves it, however, i.e. protects it from uselessness and decay, only by working it in a purposeful way, by making it the object of new living labour. This preservation of the old use value is not a process taking place separately from the increase or the completion of the use value by new labour; it takes place, rather, entirely in this new labour of raising the use value. When the labour of weaving transforms yarn into fabric, i.e. treats yarn as the raw material of weaving (a particular form of living labour) (and twist has a use value only if it is woven into fabric), it thereby preserves the use value which cotton had as such, as well as that which cotton had obtained specifically as yarn. It preserves the product of labour by making it into the raw material of new labour; but what happens is not that it (1) adds new labour and (2) besides that, by means of additional labour, preserves the use value of the raw material. It preserves the utility of cotton as yarn by weaving the yarn into fabric. (All this belongs already in the first chapter on production in general.) Preserves it by weaving it. This preservation of labour as product – of the use value of the product of labour by its becoming the raw material of new labour, being again posited as material objectivity of purposeful living labour – is given with the simple production process. As regards use value, labour has the property of preserving the existing use value by raising it, and it raises it by making it into the object of new labour as defined by an ultimate aim; by changing it in turn from the form of its indifferent consistency into that of objective material, the body of labour. (The same holds for the instrument. A spindle maintains itself as a use value only by being used up for spinning. If it is not, the specific form which is here posited in iron and wood would be spoiled for use, together with the labour which posited it and the material in which it did the positing. The use value of wood and iron, and of their form as well, are preserved only by being posited as a means of living labour, as an objective moment of the existence of labour’s vitality. As an instrument of labour, it is their destiny [Bestimmung] to be used up, but used up in the process of spinning. The increased productivity which it lends to labour creates more use values and thereby replaces the use value eaten up in the consumption of the instrument. This appears most clearly in agriculture, because there the instrument appears most easily, because most anciently, as a use value, directly as a means of life – in contrast to exchange value. If the hoe allows the tiller to grow twice as much grain as before, then he has to spend less time on the production of the hoe itself; he has enough food to make a new hoe.) Now, in the realization process, the value components of capital – the one in the form of the material, the other in the form of instrument – confront the worker, i.e. living labour (for the labourer exists in the process only as such) not as values, but rather as simple moments of the production process; as use values for labour, as the objective conditions of its efficacity, or as its objective moments. It lies in the nature of labour itself to preserve them by using the instrument as instrument and by giving the raw material a higher form of use value. But, as components of capital, the use values thus obtained from labour are exchange values; as such, determined by the costs of production contained in them, the amount of labour objectified in them. (Use value is concerned only with the quality of the labour already objectified.) The quantity of objectified labour is preserved in that its quality is preserved as use value for further labour, through the contact with living labour. The use value of cotton, as well as its use value as yarn, are preserved by being woven; by existing as one of the objective moments (together with the spinning wheel) in the weaving process. The quantity of labour time contained in the cotton and the cotton yarn are therefore also preserved thereby. The preservation of the quality of previous labour in the simple production process, – hence of its material as well – becomes, in the realization process, the preservation of the quantity of labour already objectified. For capital, this preservation is the preservation of the amount of objectified labour by the production process; for living labour itself, it is merely the preservation of the already present use value. Living labour adds a new amount of labour; however, it is not this quantitative addition which preserves the amount of already objectified labour, but rather its quality as living labour, the fact that it relates as labour to the use values in which the previous labour exists. But living labour is not paid for this quality, which it possesses as living labour – if it were not living labour, it would not be bought at all – rather, it is paid for the amount of labour contained in itself. What is paid for is only the price of its use value, like that of all other commodities. It does not receive payment for its specific quality of adding new amounts of labour to the amounts of labour already objectified, and at the same time preserving labour which is already objectified as objectified labour; and this quality does not cost the worker anything either, since it is a natural property of his labouring capacity. Within the production process, the separation of labour from its objective moments of existence – instruments and material – is suspended. The existence of capital and of wage labour rests on this separation. Capital does not pay for the suspension of this separation which proceeds in the real production process – for otherwise work could not go on at all. (Nor does this suspension take place in the process of exchange with the worker; but rather in the process of work itself, during production. But, as ongoing labour, it is itself already incorporated in capital, and a moment of the same. This preserving force of labour therefore appears as the self-preserving force of capital. The worker has merely added new labour; as for previous labour – owing to the existence of capital – this has an eternal existence as value, quite independent of its material existence. This is how the matter appears to capital and to the worker.) If it had to pay for this quality also, then it would just cease to be capital. This is part of the material role which labour plays by its nature in the production process; of its use value. But as use value, labour belongs to the capitalist; it belongs to the worker merely as exchange value. Its living quality of preserving objectified labour time by using it as the objective condition of living labour in the production process is none of the worker’s business. This appropriation, by means of which living labour makes instrument and material in the production process into the body of its soul and thereby resurrects them from the dead, does indeed stand in antithesis to the fact that labour itself is objectless, is a reality only in the immediate vitality of the worker – and that the instrument and material, in capital, exist as beings-for-themselves [für sich selbst seiende]. (Return to this.) The process of the realization of capital proceeds by means of and within the simple production process, by putting living labour into its natural relation with its moments of material being. But to the extent that labour steps into this relation, this relation exists not for itself, but for capital; labour itself has become already a moment of capital.

Capitalist obtains surplus labour free of charge together with the maintenance of the value of material and instrument. Labour, by adding a new value to the old one, at the same time maintains, eternizes [sic] the latter. – The preservation of values in the product costs capital nothing. – By means of the appropriation of ongoing labour, the capitalist already possesses a claim to (and, respectively) appropriation of future labour

We see therefore that the capitalist, by means of the exchange process with the worker – by indeed paying the worker an equivalent for the costs of production contained in his labour capacity, i.e. giving him the means of maintaining his labour capacity, but appropriating living labour for himself – obtains two things free of charge, first the surplus labour which increases the value of his capital; but at the same time, secondly, the quality of living labour which maintains the previous labour materialized in the component parts of capital and thus preserves the previously existing value of capital. But this preservation does not take place as a result of an increase in the amount of labour objectified by living labour, a creation of value, but simply as a result of its existence as living labour in the proper relation with material and instrument, i.e. through its quality as living labour. As such a quality, it is itself a moment of the simple production process and does not cost the capitalist anything, any more than yarn and spindle do, apart from their price, for having also become moments of the production process.

When e.g. in times of stagnations of trade etc. the mills are shut down, then it can indeed be seen that the machinery rusts away and that the yarn is useless ballast and rots, as soon as their connection with living labour ceases. If the capitalist employs labour only in order to create surplus value – to create value in addition to that already present – then it can be seen as soon as he orders work to stop that his already present capital, as well, becomes devalued; that living labour hence not only adds new value, but, by the very act of adding a new value to the old one, maintains, eternizes it. (This shows clearly the absurdity of the charge against Ricardo, that he conceives only profits and wages as necessary components of the cost of production, and not also the part of capital contained in raw materials and instrument. To the extent that the value which they represent is merely preserved, there are no new production costs. But as far as these present values themselves are concerned, they all dissolve again into objectified labour – necessary labour and surplus labour – wages and profit. The purely natural material in which no human labour is objectified, to the extent that it is merely a material that exists independently of labour, has no value, since only objectified labour is value; as little value as is possessed by the common elements as such.) The maintenance of present capital by the labour which realizes it therefore costs capital nothing and hence does not belong among the production costs; although the present values are preserved in the product and equivalents have therefore to be given for them in exchange. But the maintenance of these values in the product costs capital nothing and cannot therefore be cited among the costs of production. Nor are they replaced by labour, since they are not consumed, except in so far as they are consumed apart from and outside labour, i.e. as labour consumes (suspends) their transitoriness. Only the wage is really consumed.

Let us return once more to our example. 100 thalers capital, i.e. 50 thalers raw material, 40 thalers labour, 10 thalers instrument of production. Let the worker require 4 hours in order to create the fraction of production necessary for his maintenance, the 40 thalers representing the means of his life. Let his working day be 8 hours. The capitalist then obtains a surplus of 4 hours free of charge; his surplus value equals 4 objectified hours, 40 thalers; hence his product = 50 + 10 (preserved, not reproduced values; remained constant, unchanged as values) + 40 thalers (wages, reproduced, because consumed in the form of wage) + 40 thalers of surplus value. Sum: 140 thalers. Of these 140, 40 are excess. The capitalist had to live during production and before he began to produce; say 20 thalers. He had to own the latter apart from his capital of 100 thalers; hence equivalents for them had to be present in circulation. (How these arose does not concern us here.) Capital presupposes circulation as a constant magnitude. These equivalents now present again. Thus consumes 20 thalers of his gain. These enter into simple circulation. The 100 thalers also enter into simple circulation, but only in order to be transformed again into the conditions of new production, 50 thalers of raw material, 40 subsistence for workers, 10 instrument. There remains a surplus value, an addition as such, newly created, of 20 thalers. This is money, posited as a negatively independent value against circulation. It cannot enter into circulation as a mere equivalent, in order to exchange for objects of mere consumption, since circulation is presupposed as constant. But the independent, illusory existence of money is suspended; it now only exists in order to be realized, i.e. to become capital. In order to become that, however, it would again have to be exchanged for the moments of the production process, subsistence for workers, raw material and instrument; all these dissolve into objectified labour, can only be posited by living labour. Money, then, in so far as it now already in itself exists as capital, is therefore simply a claim on future (new) labour. It exists, objectively, merely as money. Surplus value, the new growth of objectified labour, to the extent that it exists for itself, is money; but now, it is money which in itself is already capital; and, as such, it is a claim on new labour. Here capital already no longer enters into relation with ongoing labour, but with future labour. And it no longer appears dissolved into its simple elements in the production process, but as money; no longer, however, as money which is merely the abstract form of general wealth, but as a claim on the real possibility of general wealth – labour capacity, and more precisely, labour capacity in the process of becoming [das werdende Arbeitsvermögen]. As a claim, its material existence as money is irrelevant, and can be replaced by any other title. Like the creditor of the state, every capitalist with his newly gained value possesses a claim on future labour, and, by means of the appropriation of ongoing labour has already at the same time appropriated future labour. (This side of capital to be developed to this point. But already here its property of existing as value separately from its substance can be seen. This already lays the basis for credit.) To stockpile it in the form of money is therefore by no means the same as materially to stockpile the material conditions of labour. This is rather a stockpiling of property titles to labour. Posits future labour as wage labour, as use value for capital. No equivalent on hand for the newly created value; its possibility only in new labour.

In this example, then, an absolute surplus labour time of 4 hours created, added to the old values, to the world of available wealth, a new value of 20 thalers money, and money already in connection with its form as capital (already as posited possibility of capital, not as before, becoming the possibility of capital as such only by ceasing to be money as such).

Now if the productive force doubles, so that instead of 4 hours the worker has to put in only 2 hours of necessary labour, and if the capitalist makes him work 8 hours as before, then the accounts are as follows: 50 thalers material, 20 wages, 10 instrument of labour, 60 surplus value (6 hours, 4 before). New growth of absolute surplus value: 2 hours or 20 thalers. Sum: 140 thalers (in the product).

A total of 140 thalers as before; but now 60 of them are surplus value; of which 40 for absolute increase in surplus time as before, 20 for relative. But the simple exchange value only contains 140 thalers as before. Now, is it only the use values which have increased, or has a new value been created? Before, capital had to begin again with 100 in order to realize itself anew at 40%. What happens to the 20 of surplus value? Before, the capitalist ate up 20 of them; he was left with a value of 20. Now he eats up 20 and is left with 40. On another side, the capital entering into production remained 100; now it has become 80. What is gained in value on one side in one form is lost as value on the other side in another form. The first capital re-enters into the production process; again produces a surplus value (capitalist’s consumption deducted) of 20. At the end of this second operation, a newly created value is present without equivalent. 20 thalers together with the first 40. Now let us take the second capital.

Material, 50; wages (2 hours), 20; instrument, 10. But in the 2 hours he produces a value of 8, i.e. 80 thalers (of which 20 for costs of production). Remainder, 60, since 20 reproduce the wage (disappear as wage). 60 + 60 = 120. At the end of this second operation, 20 thalers for consumption; remainder surplus value 20; together with the first operation, 60. In the third operation with the first capital, 60; with the second, 80; in the fourth operation with the first capital 80, with the second, 100. The first capital has increased as value in proportion as its exchange value, as productive capital, has decreased.

Suppose both capitals together with their surplus can be used as capital; i.e. their surplus exchanged for new labour. We then get the following calculation (leaving consumption aside): the first capital produces 40%, the second 60%. 40% of 140 is 56; 60% of 140 (i.e. capital, 80; surplus value, 60) is 84. The total product in the first case 140 + 56 = 196; in the second 140 + 84 = 224. In the second case absolute surplus value 28 higher than in the first. The first capital has 40 thalers with which to buy new labour time; the value of the hour of labour was presupposed at 10 thalers; therefore, his 40 thalers buy 4 new hours of labour, which produce 80 for him (of which 40 go to replace the wages of 8 hours of labour). At the end it was 140 + 80 (i.e. reproduction of the capital of 100: surplus value of 40, or reproduction of 140; or, in the first case, 100 thalers reproduce themselves as 140; the second 40, since they are spent only to buy new labour, hence do not simply replace value – impossible presupposition, by the way) which produce 80. 140 + 80 = 220. The second capital of 140; the 80 produce 40; or the 80 thalers reproduce themselves as 120; the remaining 60, however, reproduce themselves (since they are spent purely for the purchase of labour, and do not therefore simply replace any value, but reproduce out of themselves and posit the surplus) as 180; then 120 + 120 = 240. (Produced 40 thalers more than the first capital, exactly the surplus time of two hours, for the first is a surplus time of 2 hours as assumed in the first case). Thus the result is a greater exchange value, because more labour objectified; 2 hours more surplus labour.

Something else should be noted here as well: 140 thalers at 40% yield 56; capital and interest together = 140 + 56 = 196; but we have obtained 220; according to which the interest on 140 would be not 56 but 84; which would be 60% on 140 (140:84 = 100:x; x = 8,400/140 = 60). Similarly in the second case: 140 at 60% = 84; capital and interest = 140 + 84 = 224; but we obtain 240; according to which the interest on the 140 is not 84 but 100; (140 + 100 = 240); i.e., %, (140:100 = 100:x; x = 10,000/140); [x = 71 3/7%]. Now where does this come from? (In the first case 60% instead of 40; in the second 71 3/7 instead of 60%.) In the first case, where it was 60 instead of 40, hence 20% too much came out; in the second case 71 3/7 instead of 60, i.e. 11 3/7 too much. Why, then, firstly the difference between the two cases and secondly the difference in each case?

In the first case, the original capital was 100 = 60 (material and instrument of labour) plus 40 in labour; 2/5 labour, 3/5 (material). The first 3/5 bring no interest at all; the last 2/5 bring 100%. But computed on the basis of the whole capital, the increase is only 40%; 2/5 of 100 = 40. But the 100% on the latter amount to only 40% on the whole 100; i.e. an increase of 2/5 in the whole. Now, if only 2/5 of the newly arrived capital of 40 had increased by 100%, then this would yield an increase of the whole by 16 [thalers]. 40 + 16 = 56. This together with the 140 = 196; which is then actually 40% on 156, capital and interest reckoned together. 40 increased by 100%, doubled, is 80; 2/5 of 40 increased by 100% is 16. 40 of the 80 replace capital. Gain of 40.

The account then: 100c + 40 interest + 40c + 40i = 220; or, capital of 140 with an interest of 80; but if we had calculated 100c + 40i + 40c + 16i = 196; or, capital of 140 with interest of 56.

An interest of 24 on a capital of 40 is too much; but 24 = 3/5 of 40 (3 × 8 = 24); i.e. in addition to the capital, only 2/5 of the capital grew by 100%; the whole capital therefore by only 2/5, i.e. 16%. The interest computation on 40 is 24% too high (by 100% on 3/5 of the capital); 24 on 24 is 100% on 3 × 8 (3/5 of 40). But on the whole amount of 140, it is 60% instead of 40; i.e. 24 too much out of 40, 24 out of 40 = 60%. Thus we figured 60% too much on a capital of 40 (60 = 3/5 of 100). But we figured 24 too high on 140 (and this is the difference between 220 and 196); this is first 1/5 of 100 then 1/12 of 100 too much; 1/5 of 100 = 20%; 1/12 of 100 = 8 4/12% or 8 1/3%; thus altogether 28 1/3% too high. Thus on the whole not 60%, as on 40, but only 28 1/3% too much; which makes a difference of 31 2/3, depending on whether we figure 24 too many on the 40 [or on] the capital of 140. Similarly in the other example.

In the first 80 which produce 120, 50 + 10 was simply replaced, but 20 reproduced itself threefold: 60 (20 reproduction, 40 surplus).

Hours of labour

If	20	posit	60,	making up triple the value, then
	60		180.

Notebook IV (Mid-December 1857 – 22 January, 1858)

Confusion of profit and surplus value. Carey’s erroneous calculation. – The capitalist, who does not pay the worker for the preservation of the old value, then demands remuneration for giving the worker permission to preserve the old capital. – Surplus value and profit etc. – Difference between consumption of the instrument and of wages. The former consumed in the production process, the latter outside it. – Increase of surplus value and decrease in rate of profit. (Bastiat)

This highly irksome calculation will not delay us further. The point is simply this: if, as in our first example, material and instrument amount to 3/5 (60 out of 100), and wages 2/5 (40), and if the capital yielded a gain of 40%, then it equals 140 at the end (this 40% gain equal to the fact that the capitalist made the workers put out 12 hours of labour, where 6 were necessary, hence gained 100% on the necessary labour time). Now if the 40 thalers which were gained go to work again as capital with the same presuppositions – and at the present point, the presuppositions have not changed yet – then of the 40 thalers 3/5 i.e. 24 thalers have to be used for material and instrument, and 2/5 for labour; so that the only thing that doubles is the wage of 16 which becomes 32, 16 for reproduction, 16 surplus labour; so that altogether at the end of production 40 + 16 = 56 or 40%. Thus the entire capital of 40 would have produced 196 under the same conditions. It should not be assumed, as happens in most of the economics books, that the 40 thalers are spent purely for wages, to buy living labour, and thus yield 80 thalers at the end of production.

<If it is said: a capital of 100 yields 10% in one period, 5% in another, then nothing is more mistaken than to conclude, as do Carey and consorts, that the share of capital in production was 1/10 and that of labour 9/10 in the first case; in the second case, the share of capital only 1/20 and that of labour 19/20; i.e. that the share of labour rises as the rate of profit falls. From the viewpoint of capital – and capital has no awareness whatever of the nature of its process of realization, and has an interest in having an awareness of it only in times of crisis – a profit of 10% on a capital of 100 looks like a profit on each of its value components – material, instrument, wages – equally and indifferently, as if this capital were simply a sum of 100 thalers of value which had, as such, increased by 10%. But the question is, in fact: (1) what was the relation between the component parts of capital and (2) how much surplus labour did it buy with the wage – with the hours of labour objectified in the wage? If I know the total size of a capital, the relation of its value components to one another (in practice, I would also have to know what part of the instrument of production is used up in the process, i.e. actually enters into it), and if I know the profit, then I know how much surplus labour has been created. If 3/5 of the capital consisted of material (which for the sake of convenience we here suppose to be entirely consumed productively as material of production), i.e. 60 thalers, and wages 40, and if the profit on the 100 thalers is 10, then the labour bought for 40 thalers of objectified labour time has created 50 thalers of objectified labour in the production process, hence has worked a surplus labour time or created a surplus value of 25% = 1/4 of the necessary labour time. Then if the worker works a day of 12 hours, he has worked 3 hours of surplus time, and the labour time necessary to maintain him alive for one day was 9 hours of labour. The new value created in production may only be 10 thalers, but, according to the real rate, these 10 thalers are to be reckoned on the base of the 40, not of the 100. The 60 thalers of value have created no value whatever; the working day has. Thus the worker has increased the part of capital spent for labour capacity by 25%, not by 10%. The total capital has grown by 10%. 10 is 25% of 40; it is only 10% of 100. Thus the profit rate on capital in no way expresses the rate at which living labour increases objective labour; for this increase is merely = to the surplus with which the worker reproduces his wage, i.e. = to the time which he works over and above that which he would have to work in order to reproduce his wages. If the worker in the above example were not a worker for a capitalist, and if he related to the use values contained in the 100 thalers not as to capital but simply as to the objective conditions of his labour, then, before beginning the production process anew, he would possess 40 thalers in subsistence, which he would consume during the working day, and 60 thalers in instrument and material. He would work only 3/4 of a day, 9 hours, and at the end of the day his product would be not 110 thalers but 100, which he would again exchange in the above proportions, beginning the process again and again. But he would also work 3 hours less; i.e. he would save 25% surplus labour = 25% surplus value out of the exchange which he undertakes between 40 thalers in subsistence and his labour time; and if at some time he worked 3 hours extra, because the material and the instrument were there on hand, then it would not occur to him to say that he had created a new value of 10%, but rather one of 25%, because he could buy one fourth additional subsistence, 50 thalers’ worth instead of 40; and, since he is concerned with use values, these items of subsistence by themselves would be of value for him. This illusion that the new value is derived not from the exchange of 9 hours of labour time as objectified in 40 thalers for 12 hours of living labour, i.e. a surplus value of 25% on this part, but that it comes from an even 10% increase in the total capital – 10% of 60 is 6 and of 40 is 4 – this illusion is the basis of the notorious Dr Price’s compound interest calculation, which led the heaven-born Pitt to his sinking fund idiocy. The identity of surplus gain with surplus labour time – absolute and relative – sets a qualitative limit on the accumulation of capital, namely the working day, the amount of time out of 24 hours during which labouring capacity can be active, the degree to which the productive forces are developed, and the population, which expresses the number of simultaneous working days etc. If, on the other side, surplus value is defined merely as interest – i.e. as the relation in which capital increases itself by means of some imaginary sleight of hand, then the limit is merely quantitative, and there is then absolutely no reason why capital cannot every other day convert the interest into capital and thus yield interest on its interest in infinite geometrical progression. Practice has shown the economists that Price’s interest-multiplication is impossible; but they have never discovered the blunder contained in it.

Of the 110 thalers which emerge at the end of production, 60 thalers (material and instrument), in so far as they are values, have remained absolutely unchanged. The worker took nothing away from them and added nothing to them. Of course, from the standpoint of the capitalist, the fact that the worker maintains the value of objectified labour by the very fact of his labour being living labour appears as if the worker still had to pay the capitalist to get permission to enter into the proper relation with the objectified moments, the objective conditions, of labour. Now, as regards the remaining 50 thalers, 40 of them represent not only preservation but actual reproduction, since capital has divested itself of them [von sich entäussert] in the form of wages and the worker has consumed them; 10 thalers represent production above and beyond reproduction, i.e. 1/4 surplus labour (of 3 hours). Only these 50 thalers are a product of the production process. Therefore, if the worker, as is wrongly asserted, divided the product with the capitalist so that the former’s share were 9/10, then he would have to get not 40 thalers (and he has obtained them in advance, in exchange for which he has reproduced them and paid them back in their entirety, as well as maintaining the already existing values for the capitalist free of charge), which is only 8/10 but rather 45, which would leave capital only 5. Then, having begun the production process with 100 thalers, the capitalist would have at the end only 65 thalers as product. But the worker obtains none of the 40 thalers he has reproduced, nor any of the 10 thalers of surplus value. If the 40 thalers which have been reproduced are to serve for the purchase of further living labour, then, as far as the relation is concerned, all that can be said is that an objectified labour of 9 hours (40 thalers) buys living labour for 12 hours (50 thalers) and thus yields a surplus value of 25% of the real product (partly reproduced as wage fund, partly newly produced as surplus value) in the realization process.

Just now the original capital of 100 was: 50 – 10 – 40. Produced surplus gain of 10 thalers (25% surplus time). Altogether 110 thalers.

Now suppose it were: 60 – 20 – 20. The result would be 110 thalers, so says the ordinary economist, and the even more ordinary capitalist says that 10% has been produced in equal proportions by all parts of the capital. Again, 80 thalers of capital would merely be preserved; no change taken place in its value. Only the 20 thalers would have turned into 30; i.e. surplus labour would have increased by 50%, not by 25% as before.

Take the third case: 100: 70 – 20 – 10. Result 110.

Then the invariable value, 90. The new product 20; hence surplus value or surplus time 100%. Here we have three cases in which the profit on the whole capital is always 10, but in the first case the new value created was 25% above the objectified labour spent to buy living labour, in the second case 50%, in the third: 100%.>

The devil take this wrong arithmetic. But never mind. Commençons de nouveau.

In the first case we had:

Invariable value	Wage labour	Surplus value	Total
60	40	10	110

We continue to presuppose a working day = 12 hours. (We could also assume a growing working day, e.g. x hours before, but now x + b hours, while productive force remains constant; or both factors variable.)

	Hours	Thalers
If the worker produces in	12	50
then in	1	4 1/6
then in	9 3/5	40	} in 12 hours 50 thalers
then in	2 2/5	10

The worker’s necessary labour then amounts to 9 3/5 hours (40 thalers); hence surplus labour 2 2/5 hours (value of 10 thalers). 2 2/5 hours is 1/5 of the working day. The worker’s surplus labour amounts to 1/5 of the day, i.e. = the value of 10 thalers. Now if we look at these 2 2/5 hours as a percentage which capital has gained above the labour time objectified in 9 3/5 hours, then 2 2/5:9 3/5 = 12/5:48/5, i.e. = 12:48 = 1:4. Thus 1/4 of the capital = 25% of it. Likewise, 10 thalers : 40 thalers = 1:4 = 25%. Now, summarizing the whole result:

No. I	Original capital:	Constant value:	Value reproduced for wages:	Surplus value from production:	Total sum:	Surplus time and value:	% of objectified labour exchanged:
	100	60	40	10	110	2 2/5 hours or 10. (2 2/5 of labour)	25%

(It might be said that the instrument of labour, its value, has to be not only replaced but reproduced; since it is in fact used up, consumed in production. This to be looked at under fixed capital. In actuality the value of the instrument is transposed to that of the material; to the extent that it is objectified labour, it only changes its form. If in the above example the value of the material was 50 and that of the instrument 10, then now, with the instrument used up by 5, the value of the material is 55 and that of the instrument 5; if it disappears altogether, then that of the material has reached 60. This is an element of the simple production process. Unlike wages, the instrument has not been consumed outside the production process.) Now to the second presupposition:

Original capital:	Constant Value:	Value reproduced for wages:	Surplus value from production:	Total sum:
100	80	20	10	110

If the worker produces 30 thalers in 12 hours, then in 1 hour 2 2/4 thalers, in 8 hours 20 thalers, in 4 hours 10 thalers. 10 thalers are 50% of 20 thalers; as are 4 hours out of 8 hours; the surplus value = 4 hours, 1/3 of a day, or 10 thalers surplus value. Thus:

No. II	Original capital	Constant value:	Value reproduced for wages:	Surplus value from production:	Total sum:	Surplus time and value:	% on capital:
	100	80	20 8 hours	10	110	4 hours or 10. 2 working days	50%

In the first case, like the second, the profit on a total capital of 100 = 10%, but in the first case the real surplus value which capital obtains from the production process is 25%, in the second, 50%.

The conditions presupposed in No. II are in themselves as possible as those in No. I. But brought into connection with one another, those of No. II are absurd. Material and instrument have been raised from 60 to 80, the productivity of labour has fallen from 4 1/6 thalers per hour to 2 3/4 and surplus value increased by 100%. (Suppose, however, that the increased expenditure for wages expresses more working days in the first case, fewer in the second, and then the presupposition is correct.) It is in itself irrelevant that necessary wages, i.e. the value of labour expressed in thalers, have fallen. Whether the value of an hour of labour is expressed in 2 thalers or in 4, in both cases the product of 12 hours of labour is exchanged (in circulation) for 12 hours of labour, and in both cases surplus labour appears as surplus value. The absurdity of the presupposition comes from the fact (1) that we have posited 12 hours as the minimum working time; and hence cannot introduce additional or fewer working days; (2) the more we make capital increase on one side, the more we not only make necessary labour decline, but have also to decrease its value, although the value is the same. In the second case, the price would, rather, have to rise. The fact that the worker can live from less work, i.e. that he produces more in the same number of hours, would have to be shown not in a decrease in the thalers for necessary labour, but in the number of necessary hours. If he gets, as e.g. in the first case, 4 1/6 thalers, but if the use value of this value, which has to be constant in order to express value (not price), had multiplied, then he no longer needs 9 3/5 but only 4 hours for the reproduction of his living labouring capacity, and this would have to express itself in the surplus over the value. But the way we have set up the presuppositions, our ‘invariable value’ is variable, while the 10% are invariable, here a constant addition to reproductive labour, although it expresses different percentage parts of the same. In the first case the invariable value is smaller than in the second case, but the total product of labour is larger; since, if one part of 100 is smaller, the other has to be larger; and, since absolute labour time is fixed at the identical amount, and since further the total product of labour becomes smaller, in proportion as ‘invariable value’ becomes larger, and larger as the latter becomes smaller, we therefore obtain less product (absolutely) from the same labour time in proportion as more capital is employed. Now, this would be quite correct, since, if out of a given sum such as 100 more is spent as ‘invariable value’, less can be spent for labour time, and thus, relative to total capital, less new overall value can be created; but then, if capital is to make a profit, one cannot hold labour time constant, as is done here, or, if one holds it constant, the value of the working hour cannot become smaller, as it does here; which is impossible if ‘invariable value’ becomes larger and surplus value becomes larger; the number of working hours would have to become smaller. But that is what we have assumed in the example. We assume in the first case that 50 thalers are produced in 12 hours of labour; in the second case, only 30 thalers. In the first, we make the worker work 9 3/5 hours; in the second only 6, although he produces less per hour. It’s absurd. But, understood differently, is there not after all something correct in these figures? Does not absolute new value decrease despite an increase in the relative, as soon as relatively more material and instrument than labour is introduced into the component parts of capital? Relative to a given capital, less living labour is employed; hence, even if the excess of this living labour above its costs is greater, and therefore the percentage of wages rises, i.e. the percentage relative to capital actually consumed, then the absolute new value does not necessarily become relatively smaller than in the case of a capital which employs less material and instrument (and this is the main point of the change in invariable value, i.e. value unchanged as value in the production process) and relatively more living labour; precisely because relatively more living labour is employed? An increase in the productive force then corresponds to the increase in the instrument, since the surplus value of the instrument does not keep pace, as in the previous mode of production, with its use value, its productive force, and since any increase in productive force creates more surplus value, although by no means in the same numerical proportion. The increase in the productive forces, which has to express itself in an enlargement of the value of the instrument – the space it takes up in capital expenditure – necessarily brings with it an increase in the material, since more material has to be worked in order to produce more product. (The increase in the productive force can, however, also relate to quality; but if that is given, only to quantity; or to quantity if quality is given; or to both.) Now, although there is less (necessary) labour in relation to surplus labour, and absolutely less living labour in relation to capital, is it not possible for its surplus value to rise, although in relation to the capital as a whole it declines, i.e. the so-called rate of profit declines? Take for example a capital of 100. Let material be 30 at first. 30 for instrument. (Together, invariable value of 60.) Wages 40 (4 working days). Profit 10%. Here profit is 25% on wages and 10% on capital as a whole. Now let material become 40 and instrument 40. Let productivity double, so that only 2 working days necessary = 20. Now posit that the absolute profit be smaller than 10; i.e. the profit on total capital. Is it not possible for profit on labour employed to be more than 25%, i.e. in the given case, more than merely a fourth of 20? In fact, a third of 20 is 6 2/3; i.e. less than 10, but 33 1/3% of labour employed, while in the previous case it was only 25%. In this case, we would end up with only 106 2/3, while in the previous case we would have had 110, but still, with the same capital (100) the surplus labour, surplus gain relative to labour employed, would be greater than in the first case; but since 50% less labour was employed, in absolute terms, than in the first case, while the profit on labour employed was only 8 1/3 more than in the first case, it follows that the absolute quantity which results has to be smaller, and the same applies to the profit on total capital. For 20 × 33 1/3 is smaller than 40 × 25. This whole instance is improbable and cannot count as a general example in economics; for an increase in the instrument and an increase in the material worked are both presupposed, while not only the relative but the absolute number of workers has declined. (Of course, when two factors = a third, one has to grow smaller as the other grows larger.) But an increase in the value of the instrument in relation to capital as a whole, and an increase in the value of the material, all in all presuppose a division of labour, hence at least an absolute increase in the number of workers, if not an increase relative to capital as a whole. However, take the case of the lithographing machine, which everyone can use to make lithographs without special skill; suppose the value of the instrument immediately upon its invention to be greater than that which 4 workers absorbed before these handy things were invented; it now requires only 2 workers (here, as with many instrument-like machines, no further division of labour takes place; instead, the qualitative division disappears); let the instruments originally have a value of only 40, but let 4 working days be necessary (necessary, here, for the capitalist to make a profit). (There are machines, e.g. forced air heating ducts, where labour as such disappears altogether except at a single point; the duct is open at one point, and carries heat to the others; no workers are required at all. This the case generally (see Babbage) with energy transmission, where, previously, energy had to be carried in material form by numbers of workers, here firemen, from one point to another – where the transmission from one room to another, which has now become a physical process, appeared as the labour of numbers of workers.) Now, if he uses this lithographing machine as a source of income, as capital, and not as use value, then the material must necessarily increase, since he can put out more lithographs in the same amount of time, which is precisely where this greater profit comes from. Let this lithographer then employ an instrument to the amount of 40, material 40, 2 working days (20) which [give] him 33 1/3%, i.e. 6 2/3 out of an objectified labour time of 20; then his capital, like the other’s, consists of 100, only yields 6 2/3%, but he gains 33 1/3 on labour employed, while the other gains 10 on capital, but only 25% on labour. The value obtained from labour employed may be smaller, but the profits on the whole capital are greater if the other elements of capital are relatively smaller. Despite this, the business at 6 2/3% on the total capital and 33 1/3% on labour could become more profitable than the earlier one based on 25% on labour and 10% profit on the total capital. Suppose e.g. that grain prices etc. rose so that the maintenance of the worker rose by 25% in value. The 4 working days would now cost the first lithographer 50 instead of 40. His instruments and material would remain the same: 60 thalers. He would then have to lay out a capital of 110. With this capital, his profit on the 50 thalers for 4 working days would be 12 (25%). Hence 12 thalers on 110 (i.e. 9 1/6% on the total capital of 110). The other lithographer: machine 40, material 40; but the 2 working days will cost him 25% more than 20, i.e. 25. He would thus have to lay out 105; his surplus value on labour 33 1/3%, i.e. 1/3, is 8 1/3. He would gain then, 8 1/3 on 105; 13 1/8%. Then suppose a 10 year cycle with 5 bad and 5 good harvests at the above average proportions; then the first lithographer would gain 50 thalers of interest on the second during the first 5 years; in the last 5 45 5/6; altogether 95 5/6 thalers; average interest over the 10 years 9 7/12 thalers. The other capitalist would have gained 31 1/3 in the first 5 years, 65 5/8 in the last; 96 23/24 altogether; a 10-year average of 9 84/120. Since No. II uses up more material at the same price, he sells cheaper. It could be said in reply that he sells dearer because he uses up more instrument; especially because he uses up more of the value of the machine in proportion as he uses up more material; however, it is in practice not true that machines wear out and have to be replaced more rapidly as they work more material. But all this is beside the point. Let the relation between the value of the machine and that of the material be constant in both cases.

This example attains significance only if we assume a smaller capital which employs more labour and less material and machinery, but yields a higher percentage on the total capital; and a larger capital employing more machinery and more material, as many working days in absolute numbers but relatively fewer, and a smaller percentage on the whole, because less on labour, being more productive, division of labour used, etc. It also has to be postulated (which was not done above) that the use value of the machine significantly greater than its value; i.e. that its devaluation in the service of production is not proportional to its increasing effect on production.

Thus, as above, a press (first, hand-operated printing press; second, self-acting printing press).

Capital I, 100, uses 30 in material; 30 for the manual press; 4 working days = 40 thalers; gain 10%; hence 25% on living labour (1/4 surplus time).

Capital II, 200, uses 100 in materials; 60 in press, 4 working days (40 thalers); gain on the 4 working days 13 1/3 thalers = 1 working day and 1/3, compared to only 1 working day in the first case; total sum: 213 1/3. I.e. 6 2/3%, compared to 10% in the first case. Nevertheless, the surplus value on the labour which has been employed is 13 1/3 in this second case, as against 10 in the first; in the first, 4 days create 1 surplus day in 4 working days; in the second, 4 days create 1 1/3 surplus days. But the rate of profit on the total capital is 1/3 or 33 1/3% smaller than in the first; the total amount of the gain is 1/3 greater. Now let us suppose that the 30 and the 100 in material are sheets of book paper, and that the instruments wear out in the same space of time, say 10 years or 1/10 per year. Then No. I has to replace 1/10 of 30 in material, i.e. 3; No. II, 1/10 of 60, i.e. 6. The material does not enter further into annual production (which may be regarded as 4 working days of 3 months each) on either side, see above.

Capital I sells 30 sheets at 30 for materials + 3 for instrument + 50 (objectified labour time) (production time) = 83.

Capital II sells 100 sheets at 100, material, + 6, instrument, + 53 1/3 = 159 1/3.

Capital I sells 30 sheets for 83 thalers, 1 sheet at 83/80 thalers = 2 thalers, 23 silver groschen.

Capital II sells 100 sheets for 159 thalers, 10 silver groschen; 1 sheet at

159 thalers 10 silver groschen	i.e., 1 thaler, 17 silver groschen, 8 pfennigs.
100

It is clear then that Capital I is done for, because its selling price is infinitely too high. Now, although in the first case the profit on total capital was 10% and in the second case only 6 2/3%, the first capital only took in 25% on labour time, while the second takes 33 1/3%. With Capital I, necessary labour is greater relative to the total capital; and hence surplus labour, while smaller in absolute terms than with Capital II, shows up as a higher rate of profit on the smaller total capital. 4 working days at 60 are greater than 4 at 160; in the first, 1 working day corresponds to a capital of 15; in the second, 1 working day corresponds to 40. But with the second capital, labour is more productive (which is given both in the greater amount of machinery, hence the greater amount of space that it takes up among the value components of capital; and in the greater amount of material in which a working day, which consists of a greater proportion of surplus time and hence uses more material in the same time, is expressed). It creates more surplus time (relative surplus time, i.e. determined by the development of the force of production). In the first case, surplus time is 1/4, in the second, 1/3. It therefore creates more use values and a higher exchange value in the same amount of time; but the latter not in proportion with the former, since, as we saw, exchange value does not rise in the same numerical proportion as the productivity of labour. The fractional price is therefore smaller than the total production price – i.e. the fractional price multiplied by the amount of fractional prices produced is greater. Now, if we had assumed an absolutely greater number of working days than in No. I, although a relatively smaller number, then the matter would have been even more striking. The profit of the larger capital, working with more machinery, therefore appears smaller than that of the smaller capital working with relatively or absolutely more living labour, precisely because the higher profit on living labour appears as smaller, when calculated on the basis of a total capital in which living labour makes up a lesser proportion of the whole, than the lower profit on living labour which makes up a larger proportion of the smaller total capital. But the fact that No. II can employ more material, and that a larger proportion of the total value is in the instrument, is only the expression of the productivity of labour.

This, then, is the unfortunate Bastiat’s famous riddle; he had firmly convinced himself – to which Mr Proudhon had no answer – that because the rate of profit of the larger and more productive total capital is smaller, it follows that the worker’s share has grown larger, whereas precisely the opposite is the case; his surplus labour has grown larger.

Nor does Ricardo seem to have understood the matter, for otherwise he would not have tried to explain the periodic decline of profit merely by the rise in wages caused by the rise in grain prices (and hence of rent). But at bottom, surplus value – in so far as it is indeed the foundation of profit, but still distinct from profit commonly so-called – has never been developed. The unfortunate Bastiat would have said in the above case that in the first example the profit was 10% (i.e. 1/10), in the second only 6 1/4%, i.e. 1/16 (leaving out the percentage), so that the worker receives 9/10 in the first case, 15/16 in the second. The relation is correct in neither of the two cases, nor is their relation to one another correct. Now, as far as the further relation of the new value of capital to capital as indifferent total value is concerned (and this is how capital as such appeared to us at the beginning, before we moved on into the production process, and it must again appear to us in this way at the end of the process), this is to be developed partly under the rubric of profit, where the new value obtains a new character, and partly under the heading of accumulation. We are here initially concerned only with developing the nature of surplus value as the equivalent of the absolute or relative labour time mobilized by capital above and beyond necessary labour time.

The consumption, in the production process, of the element of value consisting of the instrument cannot in the least [serve to] distinguish the instrument of labour from the material – here, where all that is to be explained is the creation of surplus value, self realization. This is because this consumption is part of the simple production process itself, hence the value of the consumed instrument (whether it be the simple use value of the instrument itself or the exchange value, if production has already progressed to where there is a division of labour and where at least the surplus is exchanged) has to be recovered again in the value (exchange value) or the use value of the product – so that the process can begin anew. The instrument loses its use value in the same proportion as it helps to raise the exchange value of the raw material and serves as a means of labour. This point must, indeed, be examined, because the distinction between the invariable value, the part of capital which is preserved; that which is reproduced (reproduced for capital; from the standpoint of the real production of labour – produced); and that which is newly produced, is of essential importance.

Multiplication of simultaneous working days. (Accumulation of capital.) – Growth of the constant part of capital in relation to the variable part spent on wages = growth of the productivity of labour. – Proportion in which capital has to increase in order to employ the same number of workers if productivity rises

It is now time to finish with the question of the value resulting from the growth of the productive forces. We have seen: this creates a surplus value (not merely a greater use value) just as in the case of an absolute increase in surplus labour. If a certain limit is given, say e.g. that the worker needs only half a day in order to produce his subsistence for a whole day – and if the natural limit has been reached – then an increase of absolute labour time is possible only if more workers are employed at the same time, so that the real working day is simultaneously multiplied instead of only lengthened (in the given conditions, the individual worker can work no more than 12 hours; if a surplus time of 24 hours is to be gained, then there have to be 2 workers). Capital in this case, before entering the self-realization process, has to buy 6 additional hours of labour in the act of exchange with the worker, i.e. has to lay out a greater part of itself; at the same time it has to lay out more for material, on the average (beside the fact that the extra worker has to be available, i.e. that the working population has to have grown). Hence the possibility of this further realization process depends here on a previous accumulation of capital (as regards its material existence). If, however, productivity increases, and hence relative surplus time – at the present point we can still regard capital as always directly engaged in the production of subsistence, raw materials etc. – then less expenditure is necessary for wages and the growth in the material is created by the realization process itself. But this question belongs, rather, with the accumulation of capitals.

We now come to the point where we last broke off. An increase in productivity increases the surplus value, although it does not increase the absolute amount of exchange values. It increases values because it creates a new value as value, i.e. a value which is not merely an equivalent destined for exchange, but which asserts itself as such; in a word, more money. The question is: does it ultimately also increase the amount of exchange values? This is, at bottom, admitted; for even Ricardo admits that along with the accumulation of capitals there is an increase in savings, hence a growth in the exchange values produced. The growth of savings means nothing more than the growth of independent values – of money. But Ricardo’s demonstration contradicts his own assertion.

Our old example. 100 thalers capital; 60 thalers in constant value; 40 in wages; produces 80; hence product = 140. Let these 40 in surplus value be absolute labour time.

Now suppose that productivity doubles: then, if a wage of 40 gives 8 hours of necessary labour, the worker could now produce a whole day of living labour in 4 hours. Surplus time would then increase by 1/3 (2/3 of a day to produce a whole day before, now 1/3). 2/3 of the product of the working day would be surplus value, and if the hour of necessary labour = 5 thalers (5 × 8 = 40), then he would now need only 5 × 4 = 20 thalers. For capital, then, a surplus gain of 20, i.e. 60 instead of 40. At the end, 140, of which 60 = the constant value, 20 = the wage and 60 = the surplus gain; together, 140. The capitalist can then begin production anew with 80 thalers of capital:

Let capitalist A on the same stage of old production invest his capital of 140 in new production. Following the original proportions, he needs 3/5 for the invariable part of capital, i.e. 3 × 140/5 = 3 × 28 = 84, leaving 56 for necessary labour. Before, he spent 40 on labour, now 56; 2/5 of 40 additionally. Then at the end, his capital = 84 + 56 + 56 = 196.

Capitalist B on the higher stage of production would similarly employ his 140 thalers for new production. If out of a capital of 80 he needs 60 for invariable value and only 20 for labour, then out of a capital of 60 he needs 45 for invariable value and 15 for labour; thus the total would be = 60 + 20 +20 = 100 in the first and, secondly, 45 + 15 + 15 = 75. Thus his total yield is 175, while that of the first = 196. An increase in the productivity of labour means nothing more than that the same capital creates the same value with less labour, or that less labour creates the same product with more capital. That less necessary labour produces more surplus labour. The necessary labour is smaller in relation to capital; for the process of its realization this is obviously the same as: capital is larger in relation to the necessary labour which it sets into motion; for the same capital sets more surplus labour in motion, hence less necessary labour.

It is sometimes said about machinery, therefore, that it saves labour; however, as Lauderdale correctly remarked, the mere saving of labour is not the characteristic thing; for, with the help of machinery, human labour performs actions and creates things which without it would be absolutely impossible of accomplishment. The latter concerns the use value of machinery. What is characteristic is the saving of necessary labour and the creating of surplus labour. The higher productivity of labour is expressed in the fact that capital has to buy a smaller amount of necessary labour in order to create the same value and a greater quantity of use values, or that less necessary labour creates the same exchange value, realizes more material and a greater mass of use values. Thus, if the total value of the capital remains the same, an increase in the productive force means that the constant part of capital (consisting of machinery and material) grows relative to the variable, i.e. to the part of capital which is exchanged for living labour and forms the wage fund. This means at the same time that a smaller quantity of labour sets a larger quantity of capital in motion. If the total value of capital entering into the production process increases, then the wage fund (this variable part of capital) must decrease relatively, compared to the relation if the productivity of labour, i.e. the relation of necessary to surplus labour, had remained the same. Now let us assume in the above case that the capital of 100 is agricultural capital. Then, 40 thalers for seeds, fertilizer etc.; 20 thalers instrument of labour, and 40 thalers wage labour, at the old level of production. (Let these 40 thalers = 4 days of necessary labour.) At the old production level, these create a total of 140. Now let fertility double, owing to improvement either in the instrument or in the fertilizer etc. In this case the product has to = 140 thalers (given that the instrument is entirely consumed). Let fertility double, so that the price of the necessary working day falls by half; so that only 4 necessary half days of work (i.e. 2 whole ones) are necessary in order to produce 8. 2 working days to produce 8 is the same as when 1/4 of each working day (3 hours) is required for necessary labour. Now, instead of 40 thalers, the farmer has to spend only 20 for labour. Thus at the end of the process the component parts of capital have changed; from the original 40 for seed etc., which now have double the use value; 20 for instrument and 20 for labour (2 whole working days). Before the relation of the constant part of capital to the variable = 60:40 = 3:2; now 80:20 = 4:1. Looking at the whole capital, necessary labour was = 2/5; now 1/5. Now, if the farmer wants to continue to use labour in the old relation, then by how much would his capital have to increase? Or – in order to avoid the nefarious presupposition that he continued to operate with a constant capital of 60 and a wage fund of 40 – after a doubling of productive force, which introduces false relations; because it presupposes that, despite the doubled force of production, capital continued to operate with the same component parts, to employ the same quantity of necessary labour without spending more for raw material and instrument of labour; † then, therefore, productivity doubles, so that he now needs to spend only 20 thalers on labour, whereas he needed 40 before. (If it is given that 4 whole working days were necessary, each = 10 thalers, in order to create a surplus of 4 whole working days, and if this surplus is provided for him by the transformation of 40 thalers of cotton into yarn, then he now needs only 2 whole working days in order to create the same value, i.e. that of 8 working days; the value of the yarn expressed a surplus time of 4 working days before, now of 6. Or, each of the workers needed 6 hours of necessary labour time before in order to create 12; now 3. Necessary labour time was 12 × 4 = 48, or 4 days. In each of these days, the surplus time was = 1/2 day (6 hours). It now amounts to only 12 × 2 = 24 or 2 days; 3 hours per day. In order to bring forth the surplus value, each of the 4 workers would have to work 6 × 2 hours; i.e. 1 day; now he needs to work only 3 × 2 hours; i.e. 1/2 day. Now, whether 4 work 1/2 a day or 2 a whole (1) day is the same. The capitalist could dismiss 2 workers. He would even have to dismiss them, since a certain quantity of cotton is only enough to make a certain quantity of yarn; thus he cannot order 4 whole days of work any more, but only 4 half days. But if the worker has to work 12 hours in order to obtain 3 hours, i.e. his necessary wage, then, if he works 6 hours, he will obtain only 1 1/2 hours of exchange value. But if he can live for 12 hours with 3 hours of necessary labour, then with it he can live only 6 hours. Thus if all 4 workers were to be employed, each of the 4 could live only half a day; i.e. the same capital cannot keep all 4 alive as workers, but only 2. The capitalist could pay 4 out of the old fund for 4 half days of work; then he would pay 2 too many and would make the workers a present of the productive force; since he can use only 4 half days of living labour; such ‘possibilities’ neither occur in practice, nor can we deal with them here, where we are concerned with the relation of capital as such.) Now 20 thalers of the capital of 100 are not directly employed in production. The capitalist uses 40 thalers of raw material, 20 for instrument, together 60 as before, but now only 20 thalers for labour (2 working days). Of the whole capital of 80 he uses 3/4 (60) for the constant part and only 1/4 for labour. Then if he employs the remaining 20 in the same way, 3/4 for constant capital, 1/4 for labour; then 15 for the first, 5 for the second. Now since 1 working day = 10 thalers (given), 5 would be only = 6 hours = 1/2 working day. With the new value of 20, gained through productivity, capital could buy only 1/2 a working day more, if it continues to realize itself in the same proportion. It would have to grow threefold (namely, 60) (together with the 20 = 80) in order to employ the 2 dismissed workers for the previous 2 full working days. In the new relation, the capital uses 3/4 in constant capital in order to employ 1/4 as wage fund.

† Suppose cotton alone doubled in productivity, the machine remains the same, then – this to be examined further.

Thus if 20 is the whole capital, 3/4 i.e. 15 constant and 1/4 labour (i.e. 5) = 1/2 a working day.

With a whole capital of 4 × 20, hence 4 × 15 = 60 constant, hence 4 × 5 = 20 wages = 4/2 working days = 2 working days.

Therefore, if the productive force of labour doubles, so that a capital of 60 thalers in raw materials and instrument now needs only 20 thalers in labour (2 working days) for its realization, whereas it needed 100 before, then the total capital of 100 would have to grow to 160, or the capital of 80 now being dealt with would have to double in order to retain all the labour put out of work. But the doubling of productive force creates a new capital of only 20 thalers = 1/2 of the labour time employed earlier; and this is only enough to employ 1/2 a working day additionally. Before the doubling of the productive force, the capital was 100 and employed 4 working days (on the supposition that 2/5 = wage fund of 40); now, when the wage fund has fallen to 1/5 of 100, to 20 = 2 working days (but to 1/4 of 80, the capital newly entering into the realization process), it would have to rise to 160, by 60%, in order still to be able to employ 4 working days as before. It can only employ 1/2 a new working day with the 20 thalers drawn from the increase in the productive force, if the whole old capital continues operating. Before, it employed with 100, 16/4 (4 days) working days; it could now employ only 5/4. Therefore, when the force of production doubles, capital does not need to double in order to set the same necessary labour into motion, 4 working days; i.e. it does not need to rise to 200, but needs to rise only by double the whole, minus the part deducted from the wage fund. (100 − 20 = 80) × 2 = 160. (By contrast, the first capital, before the increase in productive force, which divided 100 as 60 constant 40 wages (4 working days), in order to employ two additional days, would need to grow from 100 to only 150; i.e. 3/5 constant capital (30) and 2/5 wage fund (20). If it is given that the working day doubles in both cases, then the second would amount to 250 at the end, the first only 160.) Of the part of capital which is withdrawn from the wage fund owing to the increase in the force of production, one part has to be transformed again into raw material and instrument, another part is exchanged for living labour; this can take place only in the proportions between the different parts which are posited by the new productivity. It can no longer take place in the old proportion, for the relation of the wage fund to the constant fund has decreased. If the capital of 100 first used 2/5 for wage fund (40) and, owing to a doubling of productive force, then used only 1/5 (20), then 1/5 of the capital has become free (20 thalers); and the employed part, 80, uses only 1/4 as wage fund. Thus, of the 20, similarly, only 5 thalers (1/2 working day). The whole capital of 100 therefore now employs 2 1/2 working days; or, it would have to grow to 160 in order to employ 4 again.

If the original capital had been 1,000, divided in the same way: 3/5 constant capital, 2/5 wage fund, then 600 + 400 (let 400 equal 40 working days; each working day = 10 thalers). Now double the productive force of labour, i.e. only 20 working days required for the same product (= 200 thalers), then the capital necessary to begin production anew would be = 800; that is 600 + 200; 200 thalers would have been set free. Employed in the same relation, then 3/4 for constant capital = 150 and 1/4 wages = 50. Thus, if the 1,000 thalers are employed in their entirety, then now 750 constant + 250 wage fund = 1,000 thalers. But 250 wage fund would be = 25 working days (i.e. the new fund can employ labour time only in the new relation, i.e. at 1/4; in order to employ the entire labour time as before, it would have to quadruple). The liberated capital of 200 would employ a wage fund of 50 = 5 working days (1/4 of the liberated labour time). (The part of the labour fund disconnected from capital is itself employed as capital at only 1/4 for labour fund; i.e. precisely in the relation in which that part of the new capital which is labour fund stands to the total sum of the capital.) Thus in order to employ 20 working days (4 × 5 working days), this fund would have to grow from 50 to 4 × 50 = 200; i.e. the liberated part would have to grow from 200 to 600, i.e. triple; so that the entire new capital would amount to 800. Then the total capital, 1,600; of this, 1,200 constant part and 400 labour fund. Thus if a capital of 1,000 originally contained a labour fund of 400 (40 working days), and if, owing to a doubling of productive force, it now needs to employ a labour fund of only 200 in order to buy necessary labour, i.e. only 1/2 of the previous labour; then the capital would have to grow by 600 in order to employ all the previous labour in its entirety (in order to gain the same amount of surplus time). It would have to be able to employ twice the labour fund, i.e. 2 × 200 = 400; but, since the relation of the labour fund to the total capital is now = 1/4, this requires a total capital of 4 × 400 = 1,600.

Or, which is the same thing, it is = 2 × the new capital which owing to the new productive force replaces the old in production (800 × 2) (thus if the productive force had quadrupled, quintupled etc. = 4 ×, 5 × the new capital etc. If the force of production has doubled, then necessary labour is reduced to 1/2; likewise the labour fund. Thus if it amounted, as in the above case of the old capital of 1,000, to 400, i.e. 2/5 of the total capital, then, afterwards, 1/5 or 200. This relation, by which it is reduced, is the liberated part of the labour fund = 1/5 of the old capital = 200. 1/5 of the old = 1/4 of the new. The new capital is = to the old + 3/5 of the same. These trivia more closely later etc.)

Given the same original relations between the parts of the capital and the same increase in the productive force, the largeness or smallness of the capital is completely irrelevant for the general theses. Quite another question is whether, when capital grows larger, the relations remain the same (but this belongs under accumulation). But, given this, we see how an increase in the force of production changes the relations between the component parts of capital. If in both cases 3/5 was originally constant and 2/5 labour fund, then doubling the productive force acts in the same way on a capital of 100 as on one of 1,000. (The word labour fund is here used only for convenience’s sake; we have not yet developed capital in this specificity [Bestimmtheit]. So far two parts; the one exchanged for commodities (material and instrument), the other for labour capacity.) (The new capital, i.e. the part of the old capital which represents its function, is = the old minus the liberated part of the labour fund; this liberated part, however, = the fraction which used to express necessary labour (or, same thing, the labour fund) divided by the multiplier of the productive force. Thus, if the old capital = 1,000 and the fraction expressing necessary labour or the labour fund = 2/5, and if the force of production doubles, then the new capital which represents the function of the old = 800, i.e. 2/5 of the old capital = 400; this divided by 2, the multiplier of productive force, = 2/10 = 1/5 = 200. Then the new capital = 800 and the liberated part of the labour fund = 200.)

We have seen that under these conditions a capital of 100 thalers has to grow to 160, and a capital of 1,000 to 1,600, in order to retain the same labour time (of 4 or 40 working days) etc.; both have to grow by 60%, i.e. 3/5 of themselves (of the old capital), in order to be able to re-employ the liberated labour time (in the first case 20 thalers, in the second 200) of 1/5 – the liberated labour fund – as such.

Percentage of total capital can express very different relations. – Capital (like property) rests on productivity of labour

<Notabene. We saw above that identical percentages of the total capital can express very different relations in which capital creates its surplus value, i.e. posits surplus labour, relative or absolute. If the relation between the invariable value-part of capital and the variable part (that exchanged for labour) such that the latter = 1/2 the total capital (i.e. capital 100 = 50 (constant) + 50 (variable), then the part exchanged for labour would have to increase by only 50% in order to yield 25% on the capital; i.e. 50 + 50 (+ 25) = 125; while in the above example 75 + 25 (+ 25) = 125; i.e. the part exchanged for living labour increases by 100% in order to yield 25% on the capital. Here we see that, if the relations remain the same, the same percentage on the total capital holds no matter how big or small it may be; i.e. if the relation of the labour fund to the total capital remains the same; thus, above, 1/4. Thus: 100 yields 125, 80 yields 100, 1,000 yields 1,250, 800 yields 1,000, 1,600 yields 2,000 etc., always = 25%. If capitals whose component parts are in different relations, including therefore their forces of production, nevertheless yield the same percentages on total capital, then the real surplus value has to be very different in the different branches.>

<Thus the example is correct, the productive force compared under the same conditions with the same capital before the rise in productive force. Let a capital of 100 employ constant value 50, labour fund = 50. Let the fund increase by 50%, i.e. 1/2; then the total product = 125. Let the labour fund of 50 thalers employ 10 working days, pay 5 thalers per day. Since the new value is 1/2, the surplus time has to be = 5 working days; i.e. the worker who needed to work only 10 working days in order to live for 15 has to work 15 for the capitalist in order to live for 15; and his surplus labour of 5 days constitutes capital’s surplus value. Expressed in hours, if the work day = 12 hours, then surplus labour = 6 per day. Thus in 10 days or 120 hours, the worker works 60 hours = 5 days too many. But now with the doubling of productivity, relations within the 100 thalers would be 75 and 25, i.e. the same capital now needs to employ only 5 workers in order to create the same value of 125; the 5 working days then = 10; doubled; i.e. 5 working days are paid, 10 produced. The worker would need to work only 5 days in order to live 10 (before the increase in productive force he had to work 10 to live 15; thus, if he worked 5, he could live only 7 1/2); but he has to work 10 for the capitalist in order to live 10; the latter thus makes a profit of 5 days; 1 day per day; or, expressed in days, the worker had to work 1/2 to live 1 before (i.e. 6 hours to live 12); now he needs to work only 1/4 to live 1 (i.e. 3 hours). If he worked a whole day, he could live 2; if he worked 12 hours, 24; if he worked 6, 12 hours. But he now has to work 12 hours to live 12. He would need to work only 1/2 in order to live 1; but he has to work 2 × 1/2 = 1 to live 1. In the old state of the productive force, he had to work 10 days to live 15; or 12 hours to live 18; or 1 hour to live 1 1/2, or 8 hours to live 12, i.e. 2/3 of a day to live 3/3. But he has to work 3/3 to live 2/3, i.e. 1/3 too much. The doubling of the productive force increases the relation of surplus time from 1:1 1/2 (i.e. 50%) to 1:2 (i.e. 100%). In the earlier labour time relation: he needed 8 to live 12, i.e. 2/ 3 of the whole day was necessary labour; he now needs only 1/2, i.e. 6, to live 12. That is why capital now employs 5 workers instead of 10. If the 10 (cost 50) produced 75 before, then now the 25, 50: i.e. the former only 50%, the second 100. The workers work 12 hours as before; but in the first case capital bought 10 working days, now merely 5; because the force of production doubled, the 5 produce 5 days of surplus labour; because in the first case 10 working days yielded only 5 days of surplus labour; now, with the force of production doubled, i.e. risen from 50% to 100% – 5, 5; in the first case 120 working hours (= 10 working days) produce 180; in the second, 60, 60; i.e. in the first case, the surplus time is 1/3 of the whole day (50% of necessary labour) (i.e. 4 hours out of 12; necessary time 8); in the second case surplus time is 1/2 the whole day (100% of necessary labour) (i.e. 6 hours out of 12; necessary time 6); hence the 10 days yielded 5 days of surplus time (surplus labour) in the first case, and in the second the 5 yield 5. Thus relative surplus time has doubled; relative to the first relation it grew by only 1/2 compared to 1/3; i.e. by 16 4/6%.>

	constant		variable
100	60	+	40	(original relation)
100	75	+	25	(+ 25) = 125 (25%)
160	120	+	40	(+ 40) = 200 (25%)

Since surplus labour, or surplus time, is the presupposition of capital, it therefore also rests on the fundamental presupposition that there exists a surplus above the labour time necessary for the maintenance and reproduction of the individual; that the individual e.g. needs to work only 6 hours in order to live one day, or 1 day in order to live 2 etc. With the development of the forces of production, necessary labour time decreases and surplus labour time thereby increases. Or, as well, that one individual can work for 2 etc. (‘Wealth is disposable time and nothing more. … If the whole labour of a country were sufficient only to raise the support of the whole population, there would be no surplus labour, consequently nothing that can be allowed to accumulate as capital . . . Truly wealthy a nation, if there is no interest or if the working day is 6 hours rather than 12 … Whatever may be due to the capitalist, he can only receive the surplus labour of the labourer; for the labourer must live.’ (The Source and Remedy of the National Difficulties.)

‘Property. Origin in the productivity of labour. If one can produce only enough for one, everyone worker; there can be no property. When one man’s labour can maintain five, there will be four idle men for one employed in production. Property grows from the improvement in the mode of production … The growth of the property, this greater ability to maintain idle men and unproductive industry = capital … machinery itself can seldom be applied with success to abridge the labours of an individual: more time would be lost in its construction than could be saved by its application. It is only really useful when it acts on great masses, when a single machine can assist the labours of thousands. It is accordingly in the most populous countries where there are most idle men that it is always most abundant. It is not called into action by scarcity of men, but by the facility with which they are brought together … Not 1/4 of the English population provides everything that is consumed by all. Under William the Conqueror for example the amount of those directly participating in production much greater relative to the idle men.’ (Ravenstone, IX, 32.)

Just as capital on one side creates surplus labour, surplus labour is at the same time equally the presupposition of the existence of capital. The whole development of wealth rests on the creation of disposable time. The relation of necessary labour time to the superfluous (such it is, initially, from the standpoint of necessary labour) changes with the different stages in the development of the productive forces. In the less productive stages of exchange, people exchange nothing more than their superfluous labour time; this is the measure of their exchange, which therefore extends only to superfluous products. In production resting on capital, the existence of necessary labour time is conditional on the creation of superfluous labour time. In the lowest stages of production, firstly, few human needs have yet been produced, and thus few to be satisfied. Necessary labour is therefore restricted, not because labour is productive, but because it is not very necessary; and secondly, in all stages of production there is a certain common quality [Gemeinsamkeit] of labour, social character of the same, etc. The force of social production develops later etc. (Return to this.)

Increase of surplus labour time. Increase of simultaneous working days (Population). (Population can increase in proportion as necessary labour time becomes smaller, i.e. the time required to produce living labour capacities decreases.) – Surplus capital and surplus population. – Creation of free time for society

Surplus time is the excess of the working day above that part of it which we call necessary labour time; it exists secondly as the multiplication of simultaneous working days, i.e. of the labouring population. (It can also be created – but this is mentioned here only in passing, belongs in the chapter on wage labour – by means of forcible prolongation of the working day beyond its natural limits; by the addition of women and children to the labouring population.) The first relation, that of the surplus time and the necessary time in the day, can be and is modified by the development of the productive forces, so that necessary labour is restricted to a constantly smaller fractional part. The same thing then holds relatively for the population. A labouring population of, say, 6 million can be regarded as one working day of 6 × 12, i.e. 72 million hours: so that the same laws applicable here.

It is a law of capital, as we saw, to create surplus labour, disposable time; it can do this only by setting necessary labour in motion – i.e. entering into exchange with the worker. It is its tendency, therefore, to create as much labour as possible; just as it is equally its tendency to reduce necessary labour to a minimum. It is therefore equally a tendency of capital to increase the labouring population, as well as constantly to posit a part of it as surplus population – population which is useless until such time as capital can utilize it. (Hence the correctness of the theory of surplus population and surplus capital.) It is equally a tendency of capital to make human labour (relatively) superfluous, so as to drive it, as human labour, towards infinity. Value is nothing but objectified labour, and surplus value (realization of capital) is only the excess above that part of objectified labour which is necessary for the reproduction of labouring capacity. But labour as such is and remains the presupposition, and surplus labour exists only in relation with the necessary, hence only in so far as the latter exists. Capital must therefore constantly posit necessary labour in order to posit surplus labour; it has to multiply it (namely the simultaneous working days) in order to multiply the surplus; but at the same time it must suspend them as necessary, in order to posit them as surplus labour. As regards the single working day, the process is of course simple: (1) to lengthen it up to the limits of natural possibility; (2) to shorten the necessary part of it more and more (i.e. to increase the productive forces without limit). But the working day, regarded spatially – time itself regarded as space – is many working days alongside one another. The more working days capital can enter into exchange with at once, during which it exchanges objectified for living labour, the greater its realization at once. It can leap over the natural limit formed by one individual’s living, working day, at a given stage in the development of the forces of production (and it does not in itself change anything that this stage is changing) only by positing another working day alongside the first at the same time – by the spatial addition of more simultaneous working days. E.g. I can drive the surplus labour of A no higher than 3 hours; but if I add the days of B, C, D etc., then it becomes 12 hours. In place of a surplus time of 3, I have created one of 12. This is why capital solicits the increase of population; and the very process by means of which necessary labour is reduced makes it possible to put new necessary labour (and hence surplus labour) to work. (I.e. the production of workers becomes cheaper, more workers can be produced in the same time, in proportion as necessary labour time becomes smaller or the time required for the production of living labour capacity becomes relatively smaller. These are identical statements.) (This still without regard to the fact that the increase in population increases the productive force of labour, since it makes possible a greater division and combination of labour etc. The increase of population is a natural force of labour, for which nothing is paid. From this standpoint, we use the term natural force to refer to the social force. All natural forces of social labour are themselves historical products.) It is, on the other side, a tendency of capital – just as in the case of the single working day – to reduce the many simultaneous necessary working days (which, as regards their value, can be taken as one working day) to the minimum, i.e. to posit as many as possible of them as not necessary. Just as in the previous case of the single working day it was a tendency of capital to reduce the necessary working hours, so now the necessary working days are reduced in relation to the total amount of objectified labour time. (If 6 are necessary to produce 12 superfluous working hours, then capital works towards the reduction of these 6 to 4. Or 6 working days can be regarded as one working day of 72 hours; if necessary labour time is reduced by 24 hours, then two days of necessary labour fall away – i.e. 2 workers.) At the same time, the newly created surplus capital can be realized as such only by being again exchanged for living labour. Hence the tendency of capital simultaneously to increase the labouring population as well as to reduce constantly its necessary part (constantly to posit a part of it as reserve). And the increase of population itself the chief means for reducing the necessary part. At bottom this is only an application of the relation of the single working day. Here already lie, then, all the contradictions which modern population theory expresses as such, but does not grasp. Capital, as the positing of surplus labour, is equally and in the same moment the positing and the not-positing of necessary labour; it exists only in so far as necessary labour both exists and does not exist.

If the relation of the necessary working days to the total number of objectified working days was = 9:12 (hence surplus labour = 1/4), then the striving of capital is to reduce it to 6:9 (i.e. 2/3, hence surplus labour = 1/3). (Develop this more closely later; still, the major basic traits here, where we are dealing with the general concept of capital.)