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Theories of Surplus-Value was written by Marx between January 1862 and July 1863. This work is part of the voluminous manuscript of 1861-63, entitled by Marx Zur Kritik der Politischen Oekonomie (A Contribution to the Critique of Political Economy) and written by him as the immediate sequel to the first part of A Contribution to the Critique of Political Economy published in 1859. The 1861-63 manuscript consists of 23 notebooks (the pages numbered consecutively from 1 to 1472) running to some 200 printed sheets in length: it is the first systematically worked out draft — though still only rough and incomplete — of all four volumes of Capital. Theories of Surplus-Value forms the longest (about 110 printed sheets) and most fully elaborated part of this manuscript and is the first and only draft of the fourth, concluding volume of “Capital”. Marx called this volume, as distinguished from the three theoretical volumes, the historical, historico-critical, or historico-literary part of his work.

Marx began to write Theories of Surplus-Value within the framework of the original plan of his Critique of Political Economy as he had projected in 1858-62. On the basis of what Marx says of the structure of his work in his introduction to the first part of A Contribution to the Critique of Political Economy, in his letters of 1858-62 and in the 1861-63 manuscript itself, this plan can be presented in the following schematic form:

PLAN OF THE CRITIQUE OF POLITICAL ECONOMY AS PROJECTED BY MARX IN 1858-62 [[The scheme’s form has been adapted for the Web edition.]]

1. Capital:

1. [Introduction: Commodity and Money]
2. Capital in general:
1. The production process of capital:
1. Transformation of money into capital
2. Absolute surplus-value
3. Relative surplus-value
4. The combination of both
5. Theories of surplus-value
2. The circulation process of capital
3. The unity of the two, or capital and profit
3. The competition of capitals
4. Credit
5. Share capital

2. Landed property

3. Wage-labour

4. The state

5. Foreign trade

6. The world-market

It can be seen from this plan that Theories of Surplus-Value was originally conceived by Marx as a historical excursus to that section of his theoretical study of “capital in general” which was devoted to the problem of the production process of capital. This historical excursus was to conclude the section on the production process of capital, in the same way as in the first part of A Contribution to the Critique of Political Economy the chapter on commodities was concluded by the historical excursus “On the History of the Theory of Commodities” and the chapter on money by the historical excursus “Theories of the Medium of Circulation and of Money”.

That was Marx’s original plan. But in the process of working it out the historical excursus on theories of surplus-value went far beyond the limits of this plan. The subject-matter of the theories to be investigated and criticised by Marx itself demanded an extension of the limits of the inquiry. The critical analysis of the views of bourgeois economists on surplus-value was unavoidably interwoven for Marx with the analysis of their ideas of profit; and in so far as these ideas were bound up with erroneous conceptions of ground-rent, it was necessary also to examine the theory of rent -and so on. On the other hand, in order to make the criticism of erroneous theories comprehensive and exhaustive, Marx counterposed to them one or another positive part of the new economic theory created by Marx himself -a theory that represents the greatest revolutionary transformation in the whole of economic science.

To grasp fully the character of the material and structure of Theories of Surplus-Value it is necessary to bear in mind also the following. At the time when Marx began his work on the Theories, of the theoretical parts of Capital only the first — “The Production Process of Capital” — had been more or less worked out in writing, and even that not fully (this question is examined in the first five notebooks of the 1861-63 manuscript). The second and third parts — to be more exact, certain sections of them — existed only in the form of preliminary sketches in the manuscript of 1857-58. In writing the historical part, therefore, Marx could not simply make reference to certain pages of his theoretical work, but was obliged to undertake a positive elaboration of those theoretical questions which came up in the critical analysis of all previous political economy.

All this led to the historical excursus Theories of Surplus-Value assuming immense proportions. In the voluminous manuscript of 1861-63 the historical, or historico-critical, part fills notebooks VI to XV inclusive, plus XVIII, and a number of separate historical essays in notebooks XX to XXIII.

The main text of Theories of Surplus-Value is contained in notebooks VI to XV and XVIII, written in the period from January 1862 to January 1863 inclusive. The table of contents compiled by Marx and written on the covers of notebooks VI to XV refers also to this text. This table of contents is of great importance for an understanding of the general structure of Marx’s work, its component parts and its plan. In the present edition it is printed at the very beginning of the first part (pp. 37-39). The historico-critical essays and notes contained in the last notebooks of the manuscript, and written in the spring and summer of 1863, are supplementary to the main text.

In the course of his work on Theories of Surplus-Value the range of problems examined by Marx was constantly extending. And in the end this led Marx to the idea that it was necessary to separate off the whole of the historico-critical material to form a special, fourth volume of Capital. In the process of Marx’s work on Capital the decisive significance of the division into three parts (1. The Production Process of Capital, 2. The Circulation Process of Capital, 3. The Unity of the Two) which Marx originally had in mind only for the section “Capital in General”, became more and more apparent. This division into three parts proved to be so important and so profound that gradually even those subjects which, according to the original plan, were not among the complex of questions allocated by Marx to the section “Capital in General”, came to be included in it (for example, the competition of capitals, credit, rent). Parallel with this process of working out the three theoretical parts of Capital, which gradually incorporated all the theoretical problems of the political economy of capitalism, Marx became more and more strongly convinced that the historico-critical inquiry should be presented in the form of a separate book — as the fourth volume of Capital.

About a month after finishing his work on the 1861-63 manuscript Marx (in a letter dated August 15, 1863) wrote to Engels about this manuscript of his: “… I look at this compilation now and see how I have had to turn everything upside-down and how I had to create even the historical part out of material of which some was quite unknown….” By “the historical part” Marx meant the Theories of Surplus-Value, which he was therefore already considering as a separate, special part of his work; whereas as late as January 1863 he was proposing to distribute this historico-critical material among the theoretical sections of his inquiry into “Capital in General”, as is evident from the plans he drew up for the first and the third parts of Capital (see pp. 414-16 of the present volume).

Marx’s intention to carry through a critical examination of the history of political economy, starting from the middle of the seventeenth century, is shown by his detailed historico-critical essay on Petty, contained in notebook XXII of the manuscript, written in May 1863; it has the characteristic heading “Historical: Petty”. This essay, which has no internal connection with either the preceding or following text, was clearly intended by Marx for the historico-critical part of his work. Petty’s views on value, wages, rent, the price of land, interest, etc., are analysed in the essay. Such a wide treatment of Petty’s economic views shows that already in May 1863 Marx had conceived the idea which four years later (April 30, 1867) he explicitly set out in a letter to Siegfried Meyer, when he wrote regarding the structure of his Capital: “Volume I comprises the ’Process of Capitalist Production’Volume II gives the continuation and conclusion of the theories, Volume III the history of political economy from the middle of the seventeenth century” (Marx at that time proposed to issue the second and third books of Capital in one volume).

We find the first direct reference to the fourth, “historico-literary”, book of Capital in Marx’s letter to Engels of July 31, 1865. Marx wrote to Engels about how he is getting on with his Capital: “There are still three chapters to write in order to complete the theoretical part (the first three books). Then there is still the fourth book, the historico-literary one, to write, which is relatively the easiest part to me as all the problems have been solved in the first three books and this last is therefore more of a repetition in historical form.” Here the question may arise why Marx says that he still has “to write” the fourth book of Capital, although in the letter of August 15, 1863 quoted above he speaks of “the historical part” as of something already written. The difference in the formulations of 1863 and of 1865 is to be explained by the fact that in the intervening period, in the course of 1864-65, Marx recast and rewrote all three theoretical parts of his work, but the fourth part — “the historico-literary” — was still in the original form as it had been written in 1862-63, and therefore had to be worked over again in conformity with his re-editing of the first three volumes of Capital.

From Marx’s letter of November 3, 1877 to Siegmund Schott it appears that Marx also later on regarded the historical part of Capital as in some degree already written. In this letter Marx says of his work on Capital: “In fact I myself began Capital, precisely in the reverse order (beginning with the third historical part) from that in which it is presented to the public, with the qualification, however, that the first volume, which was the last to be taken in hand, was prepared for the press straightway while the two others still remained in the raw form that every inquiry originally assumes.” Here the historical part is called the third for the reason that Marx, as already mentioned, intended to issue the second and third books of Capital in one volume, as Volume 11, and the fourth book, “History of the Theory”, as the third volume.

These statements by Marx entitle us to regard Theories of Surplus-Value (with the supplementary ‘historical sketches and notes from notebooks XX-XXIII) as the original and only draft of the fourth book — or fourth volume — of Capital. Engels and Lenin called Theories of Surplus-Value the fourth volume of Capital.

For these reasons, the words “Volume IV of Capital” have, in the present volume, been added in round brackets to the title Theories of Surplus-Value given by Marx in his 1861-63 manuscript.

* * *

Engels first refers to the manuscript Theories of Surplus-Value in his letters to Kautsky of February 16, and March 24, 1884. In the second letter Engels sends word of the agreement reached with Meissner, the publisher of Capital, as to the sequence in which the second and then the third book of Capital, and Theories of Surplus-Value as the concluding part of the whole work, were to be published.

In his letter to Bernstein, written in August 1884, Engels speaks in greater detail of this concluding part of Capital. Here we find: “… ‘History of the Theory’, between ourselves, is in the main written. The manuscript of A Contribution to the Critique of Political Economy … contains, as I believe I showed you here, about 500 quarto pages of Theories of Surplus-Value, in which it is true there is a good deal to be cut out, as since then it has been worked up in a different way, but there is still enough.”

Engels’s preface (dated May 5, 1885) to Volume II of Capital gives the most detailed information about the manuscript Theories of Surplus-Value and the form in which Engels intended to publish it. He points out that Theories of Surplus-Value makes up the main body of the lengthy manuscript A Contribution to the Critique of Political Economy, written in 1861-63, and continues: “This section contains a detailed critical history of the pith and marrow of Political Economy, the theory of surplus-value, and develops parallel with it, in polemics against predecessors, most of the points later investigated separately and in their logical connection in the manuscript for Books II and III. After eliminating the numerous passages covered by Books II and III I intend to publish the critical part of this manuscript as Capital, Book IV. Valuable as this manuscript is, it could not be used for the present edition of Book II.”

In his letters of the late eighties and early nineties Engels repeatedly mentions his intention of proceeding with the preparation of the fourth volume, Theories of Surplus-Value, after the publication of Volume III of Capital. He however already speaks far less categorically about eliminating the theoretical passages contained in the manuscript of the Theories.

The last mention by Engels of the manuscript Theories of Surplus-Value is in his letter to Stephan Bauer dated April 10, 1895. As this letter shows, Engels was still hoping in 1895 that he would succeed in publishing this work of Marx’s. But Engels did not manage to prepare the concluding volume of Capital for the printer; he died barely four months after this letter was written.

From Engels’s statements quoted above it is clear that he attributed great importance to the manuscript Theories of Surplus-Value, and regarded it as Volume IV of Capital. But it is also evident that in 1884-85 Engels intended to remove from the text of this manuscript “numerous passages covered by Books II and III”.

Here the question naturally comes up: what should be our attitude with regard to this proposal or intention of Engels?

Only Engels, the great companion and comrade-in-arms of Marx, and in a certain sense the co-author of Capital, could have removed from the manuscript Theories of Surplus-Value a whole series of passages. In order that the parts of the manuscript that remained after the elimination of these passages should not appear as disconnected fragments, it would have been necessary to work them over to a considerable extent and to link them together with specially written interpolations. And only Engels had the right to work over Marx’s text in such a way.

There is one more reason in favour of keeping in the text of Theories of Surplus-Value the “numerous passages” mentioned above. Engels’s intention to cut out these passages was only his original intention, formed before he had begun a detailed study of the manuscript Theories of Surplus-Value. And we know from Engels’s preface to Volume III of Capital that, in the course of his actual work on the preparation of Marx’s manuscripts for the printer, he sometimes revised his original intentions and plans. Thus, Engels originally wanted to recast Part V of Volume III of Capital, as this part of Marx’s manuscript was still in unfinished form. Engels says in his preface that he had tried at least three times to make a fundamental recasting of this part, but in the end abandoned this idea and decided to confine himself “to as orderly an arrangement of available matter as possible, and to making only the most indispensable additions”. By analogy with this, it may be presumed that if Engels had actually come to prepare the manuscript Theories of Surplus-Value for the press, he would have kept the theoretical digressions contained in it. This presumption is all the more probable because among the digressions are some in which Marx presents very important theoretical analyses, essentially supplementing the exposition, for example, in Volume III of Capital — particularly the section on rent.

Lenin had an extremely high regard for the theoretical analyses contained in the manuscript Theories of Surplus-Value. He often referred in his writings to Theories of Surplus-Value, expressing equally great esteem for both the historico-critical and the purely theoretical content of this work of Marx. He valued particularly highly the sections in which Marx developed his own views on the nature of rent (see V. I. Lenin, The Agrarian Question and the “Critics of Marx”, Eng. ed., Moscow, 1954, pp. 29 and 158; The Agrarian Programme of Social-Democracy in the First Russian Revolution, 1905-1907, Eng. ed., Moscow, 1954, pp. 101, 140, 143). Lenin refers to “Marx’s remarkable passages in his Theories of Surplus-Value, where the revolutionary significance — in the bourgeois-democratic sense — of land nationalisation is explained with particular clarity” (The Proletarian Revolution and the Renegade Kautsky, Eng. ed., Moscow, 1952, p. 152; see The Agrarian Programme of Social-Democracy in the First Russian Revolution, 1905-1907, Eng. ed., Moscow, 1954, pp. 145, 175-76; Works, 4th Russ. ed., Vol. 15, p. 148, and Vol. 16, p. 104, etc.). He cited from Theories of Surplus-Value Marx’s principal theses on absolute rent, and stated that they confirmed the correctness of his own treatment of this problem made some years before the publication of the Theories, in his work The Agrarian Question and the “Critics- of Marx” (see Eng. ed., Moscow, 1954, p. 29).

* * *

Theories of Surplus-Value was first published by Kautsky in 1905-10, and since then has been more than once republished in this Kautsky edition both in German and in other languages; it has been published several times in Russian.

The Kautsky edition has many radical defects. Setting out from the totally false assumption that the manuscript Theories of Surplus-Value was devoid of any harmonious plan and was something of a “chaos”, Kautsky subjected it to an arbitrary “adaptation”, revising the most important principles of revolutionary Marxism.

First of all Kautsky crudely violated the arrangement of the material set forth by Marx in the table of contents which he compiled and in fact adhered to in his work. Kautsky completely ignored this table of contents in preparing his edition, and did not even include it in the book.

The material in Marx’s manuscript is arranged consistently and in definite logical sequence. Analysing the attempts of bourgeois economists to resolve the basic problems of political economy, Marx reveals the class limitations that characterised even classical bourgeois political economy, the inability of the bourgeois economists to provide any internally consistent and scientifically grounded solution of the questions they dealt with, and above all of the central problem-the problem of surplus-value. Marx’s manuscript reveals that the development of bourgeois political economy was a process full of contradictions; thus in examining the theories of Smith and Ricardo, Marx shows that in certain respects they brought science forward in comparison with the Physiocrats, but in other respects they repeated the mistakes of the Physiocrats and even took a step backwards. Kautsky distorted this deeply dialectical survey of Marx; he tried to subordinate the whole material of the manuscript to an external, purely chronological sequence, and to present the course of development of bourgeois political economy as a smooth evolutionary process.

Following his chronological plan, Kautsky placed at the very beginning of his edition not the characterisation of the views of James Steuart, which in Marx’s manuscript forms the introduction to the chapter on the Physiocrats, but four short fragments (on Petty, D’Avenant, North and Locke, Hume and Massie), taken for the most part from notebooks XX and XXII. Kautsky mechanically transferred these fragments (as also certain others) to the first chapter of the first volume, and by so doing jumbled together the connected exposition of notebooks VI-XVIII (from James Steuart to Richard Jones) with the supplementary essays in notebooks XX-XXIII.

In Marx’s manuscript the analysis of Quesnay’s theory on the reproduction and circulation of the total capital came after the analysis of Smith’s theories; in the Kautsky edition this part of the manuscript precedes the chapter on Smith, and is given in a form rehashed by Kautsky, who arbitrarily removed nine tenths of this section from the main text and put it into an appendix printed in small type and wedged into the main text.

Kautsky also put the theoretical digressions in which Marx sets out his own view of the reproduction of the social capital into a separate appendix printed in small type and inserted in the text of the book. Kautsky tore them out from various places in the manuscript, grossly violating the inner connection between the historico-critical and the theoretical studies of Marx.

Kautsky was also responsible for obvious departures from the arrangement of the material given in Marx’s manuscript, in the second volume of his edition. Marx began this part of the manuscript with a critique of Rodbertus’s theory of rent; the Kautsky edition starts with the chapter “Surplus-Value and Profit”, dealing with Ricardo, and the critique of Rodbertus’s theory comes only after this chapter. In Marx’s manuscript the analysis of Ricardo’s views on surplus-value and on the process of the changing rate of profit is placed after the critique of the Ricardian theory of rent; in the Kautsky edition it is in the chapter “Surplus-Value and Profit” which begins the volume. Here also Kautsky, by departing from the sequence of the material in the manuscript, obscures important points of principle in Marx’s work, in particular, Marx’s idea that Ricardo’s errors in the theory of rent had left their stamp on the Ricardian doctrine of profit.

As a result of all these arbitrary rearrangements which he made in the manuscript, problems that are organically connected are torn apart in the Kautsky edition. For example, the chapter “Ricardo’s Theory of Profit” in Marx’s manuscript contains a critique of Ricardo’s views on the process of the formation of the average rate of profit and of his views on the causes of its fall. In the Kautsky edition these two parts of one and the same chapter of Marx’s manuscript are separated from each other by 350 pages of the text.

All the material in the manuscript is given by Kautsky in a form which obscures the questions of the class struggle, and the deep connection between economic theories and the social and political environment in which they are developed. Thus for example, in the second volume of the Kautsky edition there is a section headed by Kautsky “Anderson and Malthus. Roscher”. In the corresponding passage of the manuscript Marx shows that Anderson’s views on rent were distorted by Malthus in the interest of the most reactionary elements of the ruling classes, while Ricardo’s conclusions were directed against the landowning aristocracy. After this, Marx dwells on the vulgar economist Roscher, who crudely distorted the whole history of the question. The clear, politically sharp content of this section of the manuscript, which is a model of profound class analysis of the history of political economy, has been unsystematically lumped together by Kautsky under one general and quite colourless title which is a mere enumeration of names.

This type of editorial titling is extremely characteristic of the Kautsky edition. Almost all the titles which Kautsky furnished for the chapters and paragraphs of his edition bear an objectivist, neutral character. This applies, for example, to titles such as: “Adam Smith and the Concept of Productive Labour”, “Ricardo’s Conception of Value”, “Ricardo’s Idea of Surplus-Value”, “The Rate of Profit”, “Value and Surplus-Value”, “Variable Capital and Accumulation”, and so on. Kautsky’s titles have nowhere set off Smith’s two different definitions of value, the twofold nature of Smith’s views on the relations between value and revenue, Ricardo’s inability to connect the law of the average rate of profit with the law of value, etc., which Marx had brought to light. In his titling Kautsky also glosses over the vulgar element in the views of Smith and Ricardo: and he supplies the chapters on Ramsay, Cherbuliez and Richard Jones with titles calculated to give the reader the entirely false impression that some elements of Marxist political economy were to be found already in the works of these bourgeois economists.

Kautsky’s distortions and revisions of Marx’s text are shown in their crudest and most overt form in the numerous cuts that he made. Kautsky omitted, in his edition, not only individual words and sentences, but also whole passages, some of which fill three, four or more pages of the manuscript, in Marx’s compact writing. Among the parts of the manuscript Kautsky omitted there is even a whole chapter, which appears in Marx’s table of contents under the title: “Bray as Adversary of the Economists”. Kautsky also omitted, among many others, the passage in the manuscript in which Marx speaks of the economic preconditions of the absolute impoverishment of the working class under capitalism. Having started on the path of falsification, the revisionist Kautsky, who denied the absolute impoverishment of the working class, did not hesitate to conceal from the reader Marx’s arguments on this important question, of principle.

In “editing” Marx’s manuscript, Kautsky tried to tone down the annihilating criticism to which Marx subjected the views of the bourgeois economists, and to substitute “decorous” sleek expressions for the angry, passionate, caustic language used by Marx in his merciless criticism of the apologists of the bourgeoisie. Thus Kautsky in all passages removed from Marx’s characterisation of bourgeois economists such epithets as “asses”, “dogs”, “canaille”.

Finally, characteristic of the entire Kautsky edition are the numerous and sometimes extremely crude mistakes in deciphering the text of the manuscript, inaccurate and in a number of cases obviously incorrect translations of English and French expressions occurring in the text, arbitrary editorial interpolations inconsistent with the movement of Marx’s thought, the absolutely impermissible substitution of some of Marx’s terms by others, and so on.

The complete disregard of Marx’s table of contents, the arbitrary and incorrect arrangement of the manuscript material, the objectivist titles which avoid the class essence of the conceptions criticised by Marx, the obscuring of the fundamental antithesis between Marx’s economic teaching and the whole bourgeois political economy, the removal of a number of passages containing important theses of revolutionary Marxism, from which Kautsky more and more departed — all this suggests that what we have here is not only gross violations of the elementary requirements of a scientific edition, but also the direct falsification of Marxism.

* * *

The present edition contains in full both the main text of Theories of Surplus-Value — to which the table of contents compiled by Marx refers and which gives a connected exposition of the “history of the theory” from James Steuart to Richard Jones — and the digressions supplementing this main text which are in notebooks V, XV, XX, XXI, XXII and XXIII. These supplementary sections are put in the form of appendices, in order not to interfere with the sequence of the exposition given in the main text.

The length of all this material (about 110 printed sheets) makes it necessary to divide the book into three parts. The appendices are distributed among these three parts in such a way that each part concludes with those supplementary digressions and notes which directly refer to its contents.

The arrangement of the main text follows exactly the table of contents which Marx compiled. Only those few changes which Marx himself indicated have been made in the order of the text in some of the manuscript books. Thus, for example, in notebook VII Marx, in dealing with Smith’s conception of productive labour, and referring in this connection to the vulgarisation of Smith’s views by Germain Garnier, makes a long digression about John Stuart Mill. This begins with these words: “Before dealing with Garnier, something incidentally here [by way of a digression] on the above-mentioned Mill junior. What is to be said here really belongs later in this section, where the Ricardian theory of surplus-value is to be discussed; therefore not here, where we are still concerned with Adam Smith.” In accordance with this indication and with the table of contents of notebook XIV, later compiled by Marx, the excursus on John Stuart Mill has been placed in the present edition in the third part of Theories, in the chapter on the decline of the Ricardian school, where Marx allocates a special section to John Stuart Mill. Another example of transposition: notebook X contains a short chapter on the English socialist Bray (pp. 441-44 of the manuscript); in the later compiled plan of the contents of the last chapters of Theories of Surplus-Value (on the cover of notebook XIV) Marx however assigned the section “Bray as Adversary of the Economists” to the chapter “Adversaries of the Economists”; following this indication by Marx, in the present edition pages 441-44 have also been transferred to the third part of the work.

The division of the text into chapters follows Marx’s directions in the table of contents he compiled and in various places in the manuscript itself. For the titles given to the separate parts of the manuscript, use has been made of (1) the titles from Marx’s table of contents; (2) the titles from Marx’s draft plans for Parts I and III of Capital, which have reference to certain sections of the manuscript of Theories; (3) the few headings in the text of Theories itself. All these taken together, however, form only a comparatively small part of the titles that had to be provided for the sections and subsections of the manuscript. The rest of the titles -the majority -have been drawn up by the editors on the basis of the text of corresponding parts of the manuscript, with the fullest possible use of Marx’s own terminology and formulations. The titles given by the editors — as in general all that the editors are responsible for — have been put in square brackets, so that they can be easily distinguished from titles given by Marx.

Obvious slips of the pen occurring in the manuscript have been corrected as a rule without being expressly mentioned in footnotes. A few obvious slips of the pen in the text of notebooks VI and X were corrected by Engels’s own hand, in the manuscript itself. Specific terms used by Marx in the 1861-63 manuscript are explained in notes. The titles of books cited and mentioned by Marx are given in the text of this edition in the language of the original.

* * *

In spite of the fact that Theories of Surplus-Value was left in a form that had not prepared for the press, this work gives a connected and complete picture of that “History of the Theory” which Marx intended to form the final, fourth volume of Capital. In it Marx sets forth the whole course of evolution of bourgeois political economy from the time of its birth up to its “grave”, as vulgar political economy was called by Marx.

As already mentioned, in the present edition all the material of Theories of Surplus-Value and the supplementary sections relating to it have been divided into three parts. The content of the manuscript itself determines the way in which the material is divided.

The first part consists of seven chapters of the main text (notebooks VI-X) and thirteen supplementary sections. This part is devoted in the main to a critical analysis of the views of the Physiocrats (chapters II and VI) and of Adam Smith (chapters III and IV). Chapter I (“Sir James Steuart”), characterising Steuart’s hopeless attempt to give a rational form to the monetary and mercantile system, serves as an introduction to the analysis of Physiocratic theory. By contrasting the Physiocrats with Steuart Marx was able to bring out more sharply the role of the Physiocrats and their significance in the development of political economy — namely, that they transferred the origin of surplus-value from the sphere of circulation to the sphere of production.

Analysing the economic views of the Physiocrats, Marx shows the contradictions in their system, the dual nature of their conception of surplus-value, which is presented in their works sometimes as a pure gift of nature, at other times as the result of the special productivity of agricultural labour appropriated by the owner of the land. It is this that gives the key to an understanding of the further evolution of the Physiocratic school.

Marx shows the battle of ideas within this school, and traces the vulgarisation of Physiocratic theory by its epigones. His analysis of the ideological struggle within the Physiocratic school is inseparably linked with his characterisation of the class essence of the Physiocrats’ views.

Marx also reveals the contradictions and inconsistencies in the treatment of the most important economic categories in Adam Smith’s theory (Chapter III). Subjecting Smith’s theory to a critical analysis, Marx brings out the vulgar element it contains. This contrast between the scientific and the vulgar element in Smith’s doctrine provides the necessary basis for understanding the further evolution of bourgeois political economy, which, as Marx shows, took on a more and more vulgar character as the class struggle between the proletariat and the bourgeoisie grew sharper.

In Chapter III, in connection with the criticism of Smith’s dogma which resolves the entire value of the social product into revenue, Marx gives a theoretical analysis of the reproduction of the total social capital, and deals particularly fully with the problem of the replacement of constant capital. In addition to its general theoretical significance, this excursus (the longest of the theoretical digressions in the first part) is of great importance also because it shows how Marx arrived at his theory of the two departments of social production.

Chapter IV deals with Smith’s views on productive and unproductive labour. Along with this it gives an analysis of the struggle that flared up in connection with Smith’s views, and describes the vulgarisation of bourgeois political economy in handling the question of productive and unproductive labour. Marx traces the process of vulgarisation not only of Smith’s views on this question, but also of the views of the Physiocrats. Many of the vulgar conceptions here criticised by Marx are widely held also in contemporary bourgeois political economy, which has degenerated into open apologetics of capitalism.

Chapter VI (“Quesnay’s Tableau économique”) takes us back to the Physiocrats. There was good reason for this arrangement of the material. Though Adam Smith’s theory, as Marx’s comprehensive analysis shows, represented as a whole a considerable step forward in the development of bourgeois political economy, in his analysis of the process of reproduction Smith takes a step backwards in comparison with the Physiocrats. Marx’s arrangement of the material indicates the zigzag course of development of classical bourgeois political economy, its forward movement in the treatment of particular questions and its backward movement in the treatment of others.

Two short chapters on Necker and Linguet give an analysis of two early attempts to portray the antagonistic nature of the two classes under capitalism.

The appendices to Part I contain the historico-critical essays and notes from notebooks V, XX, XXI, XXII, XXIII and the cover of XIII. Appendices 1-7 contain characterisations of the economic views of Hobbes, Petty, Locke, North, Berkeley, Hume and Massie. In these views Marx discerns the rudiments of the labour theory of value, and of the doctrine of capital and of interest. Appendices 8-10 give supplementary material on the Physiocratic school. Appendix 11 contains a critique of the apologetic conception of the productiveness of all trades — a conception that is widespread in contemporary bourgeois political economy. Appendix 12 is a lengthy theoretical essay from notebook XXI of the manuscript, in which Marx elaborates his own view — which is the only scientific view — of the problems of productive and unproductive labour. This theoretical essay as it were draws the general conclusions from the historico-critical analysis of the problem of productive labour given by Marx in the lengthy Chapter IV of the main text. Finally, we print in Appendix 13 the draft plans for Parts I and III of Capital. They are very important for an understanding of the history of how Capital took shape; moreover, they contain formulations of certain themes which relate to its historico-critical part.

In the second part of Theories of Surplus-Value (chapters VIII-XVIII, notebooks X-XIII) the critical analysis of Ricardo’s doctrine holds the central place. Along with this there is an analysis of Adam Smith’s theory of cost-price and of rent. In his analysis of Ricardo’s system, Marx shows that it contains a number of faulty premises which owed their origin to Smith. In this connection, Marx subjects the corresponding views of Smith to special scrutiny.

In conformity with the arrangement of the material in Marx’s manuscript, the second part begins with the lengthy “excursus” dealing with Rodbertus’s theory of rent (Chapter VIII). The fact that the concept of absolute rent was altogether missing in Ricardo’s theory of rent constituted in Marx’s view its principal defect. Marx therefore prefaces his analysis of Ricardo’s theory with an extensive examination of Rodbertus’s attempts to develop this concept. In this connection, Marx substantiates his own theory of absolute rent.

The second “excursus” (Chapter IX) is a compressed historical sketch of the development of views on differential rent. Marx here lays bare the class roots of the various theories on this question. In addition, Marx gives in this chapter a profound analysis of the basic premises of the theory of rent, and reveals the close connection between the theory of rent and the theory of value, showing how errors in the theory of value lead to erroneous conclusions in the theory of rent.

These two “digressions” in this way prepare the ground for the thorough-going analysis of Ricardo’s theory contained in chapters X-XVIII.

While stressing Ricardo’s great theoretical merits, Marx at the same time underlines the defects of his method in principle — Ricardo’s inability to link the law of the average rate of profit with the law of value, the presence of vulgar elements in his theory of profit, his confusion of the process of formation of market value with the process of equalisation of the average rate of profit, his confusion of the laws of surplus-value with the laws of profit, and so on. All these defects, as Marx shows, are also evident in Ricardo’s theory of rent. Criticising this theory, Marx develops his own theory of rent, embracing both the theory of absolute rent and the theory of differential rent.

Chapters XV, XVI and XVII contain a critical analysis of Ricardo’s views on surplus-value, profit and accumulation. In Chapter XVII Marx counterposes the genuinely scientific understanding of crises as a necessary outcome of the internal contradictions of capitalism to Ricardo’s mistaken views regarding the nature of crises. Chapter XVIII is a critique of Ricardo’s views on the question of gross and net revenue, and also of his views on the economic consequences of the introduction of machinery.

Thus the critical analysis of Ricardo’s doctrine which Marx makes in the second part of Theories of Surplus-Value embraces all aspects of Ricardo’s system, showing his scientific merits and at the same time bringing out the theoretical errors and class limitations of his views.

Marx’s short supplementary notes, written on the covers of notebooks XI and XIII, are given as appendices to Part II. They contain brief observations by Marx on particular historical questions connected with the theory of capital and of rent.

Part III of Theories of Surplus-Value (chapters XIX-XXIV, notebooks XIII-XV and XVIII) deals in the main with the dissolution of the Ricardian school and the economic views of the English socialists whom Marx spoke of as “the proletarian opposition based on Ricardo”.

In Parts I and II Marx demonstrated how bourgeois political economy was vulgarised in relation only to particular questions; in Part III, however, he shows how, with the sharpening of the class struggle between the bourgeoisie and the proletariat, the process of vulgarisation lays hold of the very foundations of political economy, its initial principles, its essential categories.

In the lengthy chapter on Malthus (Chapter XIX) Marx exposes the absurdity and profoundly reactionary character of the Malthusian defence of extravagance by the unproductive classes which he glorifies as a means of avoiding overproduction. In this chapter, as in other places in his work, Marx brands Malthus as “a shameless sycophant of the ruling classes”, who falsified science in the interests of the landed aristocracy and the most reactionary elements of the bourgeoisie.

Marx shows that Ricardo’s successors also took a step backward on the basic questions of political economy; they in fact more and more openly renounced all the valuable elements in Ricardo’s system (Chapter XX). He points to the denial by Torrens that the labour theory of value is applicable to capitalist economy, and shows that James Mill returned to the vulgar conception of supply and demand in the question of wages. Marx exposes the return to this conception also in the case of Wakefield and Stirling.

This process of dissolution of the Ricardian school reaches its completion with McCulloch, whose cynical apologetics for the capitalist mode of production were most closely linked with “unscrupulous eclecticism” in the sphere of theory. Marx shows that the distortion of the concept of labour by McCulloch, who extended it to natural processes, meant in fact the complete abandonment of the labour theory of value.

Marx detects deeply reactionary features also in the polemical essays against Ricardo written by English bourgeois economists of the 1820s, in their denial of the objective character of the laws of political economy, their confusion of value with price, and their abandonment of even the category of value.

In Chapter XXI Marx analyses the economic views put forward by the “proletarian opposition based on Ricardo” (Havenstone, Hodgskin and others). Their merit, Marx points out, was that they strongly emphasised the capitalist exploitation of the workers, their view that profit, rent and interest were the surplus-labour of the workers, their polemics against the apologetic theory that capital was productive and against the conception that the capitalists accumulated means of subsistence for the workers.

Along with this, Marx traced the theoretical errors in the economic views of the socialist adherents of Ricardo: their underestimation of the significance of materialised, past labour; their incorrect idea of the process of reproduction in capitalist society; their lack of comprehension of the inner connection between the fetishisation of capital and the real relations which of necessity give birth to this fetishisation, and so on. Marx shows that these socialist adherents of Ricardo were unable to pass beyond the bourgeois premises of Ricardo’s theory, to reconstruct its very foundations.

Chapters XXII, XXIII and XXIV are devoted to a critical analysis of the ideas of Ramsay, Cherbuliez and Richard Jones. Marx notes that they attempt to differentiate between constant and variable capital and that in this connection they conjecture on the significance of the organic composition of capital. In his critical analysis of their views Marx shows how the limits of their bourgeois horizon made it impossible for these economists to develop the germs of correct ideas which in their minds were combined with vulgar conceptions of capital and the rate of profit.

The main text of Theories of Surplus-Value ends with the analysis of the views of Jones. In the plan or table of contents written by Marx on the cover of notebook XIV, after the chapter “Richard Jones” come the words “(End of this Part 5)” (see p. 38 of the present volume).

There is a long appendix to Part III of Theories of Surplus-Value, entitled “Revenue and Its Sources. Vulgar Political Economy”. The main theme of this section, which fills the second half of notebook XV, is the problem of revenue and its sources. But along with this Marx also lays bare the class and gnosiological roots of vulgar political economy, which clings to the outward semblance of the fetishised forms of revenue and its sources, and builds on them its apologetic “theories”. Marx brings out the essential difference between classical and vulgar political economy. In passing, Marx criticises also the economic views of representatives of vulgar socialism. This section, therefore, although written by Marx not so much from the historical as from the theoretical point of view, bears a direct relation to the historico-critical studies in Part III of Theories of Surplus-Value, and so must be included in it as an appendix to Part III. Later on Marx wrote that the last, historico-critical volume of Capital would contain a special and comprehensive chapter on the representatives of vulgar political economy (see Marx’s letter to Kugelmann, July 11, 1868).

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Marx formulated the essential conclusions from his deep and comprehensive analysis of the history of bourgeois political economy, in concise and generalised form, in the Afterward to the second edition of Volume I of Capital (January 1873): In so far as it is bourgeois “Political Economy can remain a science only so long as the class struggle is latent or manifests itself only in isolated phenomena.” He wrote of classical bourgeois political economy in England that it “belongs to the period in which the class struggle was as yet undeveloped”. With the development of the class struggle between the bourgeoisie and the proletariat the character of bourgeois political economy undergoes a sharp change. From the time of the conquest of political power by the bourgeoisie in France and England “the class struggle, practically as well as theoretically, took on more and more outspoken and threatening forms. It sounded the knell of scientific bourgeois economy… In place of disinterested inquiries, there were hired prize-fighters; in place of genuine scientific research, the bad conscience and the evil intent of apologetic”.

Against the background of this general degradation of bourgeois political economy the figures of a few economists stood out, who tried, as Marx says, “to harmonise the political economy of capital with the claims, no longer to be ignored, of the proletariat”. Such an attempt to “reconcile the irreconcilable” was made by John Stuart Mill. Marx notes the complete hopelessness of such attempts, which remained wholly within the bounds of bourgeois political economy and bore witness to its decay and bankruptcy. In this connection Marx strongly emphasises the outstanding significance of “the great Russian scholar and critic” N. G. Chernyshevsky, who in his Outlines of Political Economy According to Mill, as Marx says, “has thrown the light of a master mind” on the bankruptcy of bourgeois political economy.

Chernyshevsky wrote his critical analysis of John Stuart Mill’s book in 1860-61, that is, almost at the same time as Marx was at work on his Theories.

Through all of Chernyshevsky’s writings runs the idea of the need to create a new political economy, which, as opposed to former political economy which he characterised as “the theory of the capitalists”, he called quite explicitly “the theory of the working people”.

To create a new, genuinely scientific political economy, involving a radical revolutionary upheaval in economic science, was possible only for the leader and teacher of the revolutionary proletariat — Karl Marx. And only Marx, constructing the magnificent edifice of Capital on radically new principles, could build up that scientific history of all bourgeois political economy which he presented in the historico-critical part of his work of genius — Theories of Surplus-Value.

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In the imperialist epoch all the contradictions of the capitalist system reach their greatest intensity, and the class struggle grows extremely sharp. This is reflected in the most acute form also in the economic fabrications of the latest apologists of capitalism. In their efforts to defend the decaying social system of the exploiters which is doomed to destruction, contemporary bourgeois economists and the pseudo-socialists who echo their views cling fast to the most reactionary of the vulgar conceptions which were put forward by their predecessors in the pre-monopoly epoch of capitalism and were subjected to annihilating criticism in Marx’s Theories of Surplus-Value.

Thus in contemporary bourgeois literature the old hackneyed thesis, that every increase in wages leads inevitably to higher prices, still runs its course. This thesis, the vulgar and antiscientific nature of which Marx emphasised again and again in Theories of Surplus-Value, is now used to justify the bourgeoisie’s attack on the living standards of the working class.

Contemporary bourgeois economists (as for example Keynes, who made a sensation with his “anti-crisis” projects, and his followers) shamelessly repeat the reactionary idea of Malthus, exposed by Marx, of the salutary role of the unlimited growth of unproductive consumption as a means to fight economic crises. Praise for wasteful unproductive consumption in the conditions of today sounds particularly ominous: it brings to the fore that form of unproductive consumption which is linked with the preparation of a new world war and which consumes an ever-growing share of the budgets of capitalist states. Present-day bourgeois literature, especially American, preaches in every way the “theory”, that only increased armaments orders, and in the final account war itself, can avert economic crises of overproduction.

Malthus’s population theory — routed by Marx in Theories of Surplus-Value and in other works — is also used to justify imperialist wars. Contemporary American and British Malthusians, (for example, Vogt in the U.S.A. and Huxley in England) preach the cannibal “doctrine” that only a war of annihilation can establish the appropriate “balance” between the number of people on the earth and the means of subsistence at their disposal. They declare that a high death-rate is a salutary factor for civilisation, and hold up as an example to all nations those countries where the death-rate reaches particularly high proportions.

In fashioning their reactionary anti-scientific conceptions bourgeois economists of today rely on the outworn theories, long since exposed by Marxism, of the old vulgar political economy fabricated in the first half of the nineteenth century. They also reject the labour theory of value, and strive to replace it with vulgar “theories” of utility, demand and supply, costs of production, and so on. They also take their stand on the famous “trinitarian formula”, according to which rent is determined by nature, interest by capital, and wages by labour. Like all preachers of a “general harmony” in capitalist society who preceded them, they too deny the inevitability of capitalist crises, which are the necessary outcome of the internal contradictions of capitalism.

In Theories of Surplus-Value Marx subjected all these apologist subterfuges of vulgar political economy to devastating criticism. This great work of Marx has for that reason outstanding importance not only for understanding the history of bourgeois political economy, but also for the struggle against the present-day representatives of bourgeois reaction, who try to revive long-routed pseudo-scientific conceptions in order to use them in their dirty trade of justifying and defending the inhuman system of imperialism, that last stage of the capitalist system which has outlived its time.

Institute of Marxism-Leninism, CC CPSU