#commodity exchange

[yngwrthr]

The unique character of the commodity labor power, which as value simply represents its costs of production, but which as use value is itself the source of the creation of new value, makes it possible for the exchange between the worker and the capitalist to simultaneously correspond to, yet contradict, the laws of commodity exchange; that this, the most important of all the acts of exchange, amounts in fact to the appropriation of alien labor, without exchange, although “under the semblance of exchange”. It is clear, however, that this semblance is a “necessary semblance”, insofar as capitalist production itself is the production of commodities, and therefore presupposes the laws of commodity exchange… Capital’s mode of appropriation, which is based on the propertylessness and expropriation of the worker, is neither a complete negation nor a “falsification” of the laws of free exchange, but is rather “their highest development”.

Roman Rosdolsky, “The Making of Marx’s Capital”, Vol. I, trans. Pete Burgess, London: Pluto Press, 1980, pp. 263, 265.

[yngwrthr]

The key to a Marxist theory of law is that the legal superstructure reflects the specific form of production relations of each particular historical stage. As a legal expression of historically determined production relations, the legal sphere corresponds to the particular economic process. Legislation sanctions prevailing production relations by conferring “rights” on relations of effective control and ownership of property. Law is established from production relations to regulate social intercourse — e.g. resolves conflicts and disputes over property, which are part and parcel of class society — in a manner to hold the economy together. A full fledged legal system obtains in capitalist society and mediates interaction which emerges from that web of ownership relations.

Moreover, to understand the emergence of a fully fledged and coherent legal system, where all social interaction is regulated by a legislative bureaucracy etc., legal institutions hold the force of an external authority whose acceptance is achieved through repression. By “singling out” those social elements which do not comply with the current form of production relations, ruling class influence of legal affairs is promoted even further. This aids to hold back the explosion of contradictions and antagonisms of capitalist society.

[yngwrthr]

Michael O. Head, “Marxism, Revolution, and Law: The Experience of Early Soviet Russia”, 2004.

[yngwrthr]

Within the sphere of circulation, valorization would only be possible if commodity C is purchased above or below its value. In this case, the sum of value advanced can be increased, but one capitalist’s gain is only possible if another capitalist takes a loss of the same amount. At the level of society as a whole, the sum of value has not changed; it has simply been redistributed, just as if a simple act of theft had occurred. Capitalist profit would therefore be explained as a violation of the laws of commodity production. If we assume the normal conditions of commodity production and circulation, then the “exchange of equivalents” applies: the commodities that are exchanged for one another have the same magnitude of value, the price paid is an adequate expression of the magnitude of the value of the commodity and does not express a coincidentally greater or lesser magnitude; the commodities are exchanged “at their true values”. If surplus value is a normal phenomenon of capitalist commodity production and not just an exception, then its existence must be explained under the presupposition of an “exchange of equivalents”, and this is exactly the question that Marx poses. Marx’s deliberations can be summarized as follows: if equivalent exchange is assumed, then surplus value cannot be constituted in circulation, not in the first act of circulation, M-C, nor in the second act, C-M’. A change must take place between both acts. But outside of the sphere of circulation, the use value of the commodity purchased is merely consumed. Thus the owner of money must find a commodity on the market whose use value possesses the quality of being a source of value, so that the use of this commodity creates value, and more value than the commodity itself costs.

Michael Heinrich, “An Introduction to the Three Volumes of Karl Marx’s Capital”, trans. Alexander Locascio, New York: Monthly Review Press, 2012, pp. 90-91.

[yngwrthr]

“Where I am now” in terms of trying to explain Rosdolsky’s interpretation of Marx on “the transition [from value and money] to capital” (chapter 11 in “Making Capital”) — if that is at all possible and the attempt further suggesting that I’m wrong or at least too simplistic — is that, in order to develop capital from money, “selling in order to buy” (C-M-C), must pass over to “buying in order to sell” (M-C-M). “Only under these conditions i.e. if the circuit C-M-C turns into the circuit M-C-M, can money become self-preserving and self-augmenting value, become capital” (p. 188).

In the simple commodity circuit “C-M-C”, a commodity owner begins by exchanging a commodity for its equal in money. Next, our commodity owner exchanges this money for an equivalent value in new commodities. Thinking qualitatively, i.e. in terms of use value, the owner exchanges a commodity which is not a use value for him for another commodity which is useful for him, via the universal equivalent — money. Considered quantitatively, there is no increase or expansion of value and the exchanges values of each commodity are equal.. which is also equivalent to the value of the money involved. We notice commodities are exchanged for their equivalent in money form. And money is exchanged for its equivalent commodity form of value. This means that simple commodity exchange is a process of exchanging equivalent exchange values with a view on consumption, not increasing exchange value.

“One commodity is ultimately exchanged for another commodity… and the circulation itself only served, on the one hand to allow use values to change hands according to need, and on the other to allow them to change hands to the extent to which labor time is contained in them… and to the extent to which they are factors of equal weight in general social labor time”. (p. 185). But “Value does not emerge from value; rather, value is thrown into circulation in the form of a commodity… The same magnitude of value which previously existed in the form of the commodity, now exists in the form of money” (pp. 186-187).

Already, we see how simple commodity exchange — selling in order to buy — is determined by the use value of a commodity. At this stage of economic development, exchange value has not yet thrown use value into the dustbin. However, dominance of exchange value.. “where exchange value as such becomes further developed” (p. 186).. “the form wherein exchange value is the point of departure” (p. 184)… is the basis of the capitalist mode of production. “Capital must be understood as self-augmenting value… And for this purpose it is necessary to proceed… from ‘exchange value’” (p. 185). But capital is not simply “self-reproducing exchange value” (p. 184). That is, cannot be accumulated unless commodities are exchanged for an increase in money.

In the capital exchange circuit, “M-C-M”, value only becomes capital and the owner of money a capitalist because the commodities are produced with a view towards exchanging them for a greater exchange value than the original exchange value of “M”. In this circuit, in its complete form, the function of labor power is not only useful but becomes essential. And thus we arrive at the core of capitalist society — commodity exchange of labor power for wages.

[yngwrthr]

In the theory of the value-form, Marx sets out to unravel the riddle of a commodity’s price (i.e., the riddle of the money-form), while at the same time untangling the riddle of money. The riddle of the money-form concerns the fact that the value of a commodity is generally expressed in the form of a certain quantity of a particular use-value: gold. The riddle of money concerns how, in that case, gold’s use-value — which is the element in opposition to its value — has general validity in its given state as value. Not only had no one prior to Marx solved those riddles, there was not even an awareness that they are in fact riddles. Marx became the first to thoroughly clarify these problems by raising the theoretical question in Capital pertaining to the value-form. Marx perceived, first of all, that the money-form is the developed value-form. This means that the riddle of the money-form is nothing more than an extension of the fundamental riddle of the value-form. By tracing the money-form to its source, thereby reducing it to its elemental form, which is the simple value-form, Marx locates the core of the riddle of the money-form and of money: the fact that a commodity expresses its own value in the use-value of another commodity that it equates to itself, thereby making the use-value of that other commodity the form of its own value. This is precisely the riddle of the value-form, which is the basis of the riddle of the money-form and the riddle of money. Without unraveling the first riddle, it is quite impossible to unravel the latter two; whereas those riddles are easily unraveled once the former has been elucidated.

Samezō Kuruma, “Marx’s Theory of the Genesis of Money”, Part One, “Theory of the Value-Form and Theory of the Exchange Process”, 1957.

[yngwrthr]

Seizure of political power by the proletariat is the fundamental prerequisite of socialism. Nevertheless, experience has shown that planned production and distribution cannot replace market exchange and the market as the link between individual economic units overnight. Were this possible, then the legal form of property would be historically absolutely done for. It would have completed the cycle of its development and returned to its point of origin, to objects of direct, individual use; that is, it would in practice once more have become a primitive relation. And as a consequence of this the legal form as such would also be condemned to death. So long as the task of building a unified planned economy has not been completed, so long as the market-dominated relationship between individual enterprises and groups of enterprises remains in existence, the legal form too will remain in force.

Evgeny Pashukanis, “Law and Marxism: A General Theory: Towards a Critique of the Fundamental Juridicial Concepts”, 1924, ed. by Chris Arthur, London: Pluto Press, 1983, pp. 130-131.

[yngwrthr]

As I read more, my analysis appears to be consistent with chapters 11-14 of Rubin’s Essays on Marx. Though, I — still — have not fully digested all of this — despite having read and re-read these chapters... I began today with ch. 14 on “Abstract Labor”, which refers back to ch. 11 on “Equality of Commodities an Equality of Labor”. Next comes ch. 12 on “Content and Form of Labor”; followed by ch. 13 on “Social Labor”. It seems that Rubin’s interpretation of Marx is that “socially equalized labor” is an appropriate way to characterize pre-capitalist social forms — but, as Rubin points out, “abstract labor” does not dominate until capitalism. Socialized labor occurs not only pre-capitalism but also under communist relations. 

Maybe it is beyond my pay scale to give an accurate analysis of the distinction Rubin makes — and attributes to Marx — between socially equalized and abstract labor. Rubin, though, seems to me to be correct and in line with Marx in his analysis. Another slow, careful read of ch. 11-14 would probably be helpful in sorting this out. But “at this point”, I don’t see the distinction between “abstract labor” and “socially equalized labor” other than the fact that abstract labor rather than socially equalized labor is (overwhelmingly) used to describe the substance of value in capitalist societies. However, and again this may be above my pay grade but, for me, both seem to reflect an amount of socially necessary labor time that lurks behind exchanges in all social forms, but is not dominate/ fully developed until capitalism and neither guides production nor is necessarily a focus of accumulation in pre-capitalist societies.. If this is the case, the difference seems merely semantic to me..

I’m amazed how perfect the citation (in Chap. 1; section 4 of Capital I): When Marx states that “..value appears IN PRACTICE”, he referring to the dominance of value as not only for “occasional” exchanges in pre-capitalist social forms but (in practice) the regulation of production as well as the impetus for accumulation in capitalism. I do not feel — and also don’t feel that Marx stated — that exchange is “always” regulated by socially necessary labor time. However, I feel there are instances where “socially equalized labor” — as the substance of value — was the center of gravity as measured by stones, “bars in the mind”, cattle, etc. Consequently, there was “value” and the “value form” before the emergence of capitalism. Moreover, I assert that, opposed to capitalist societies, the value basis of exchange was weakened by exchanges based largely and more often on supply and demand as well as concrete labor/ craftsmanship, etc.

Overall, I am thus asserting that there is a difference between “value” — which is present in (almost) all social forms and described by Marx’s “Law of Value”; and the fully developed form of value — which is synonymous with capitalism and described by value form theory. (And perhaps for a later discussion: Is there a distinction between commodities — existing in pre-capitalist societies — and the universal commodity form — exclusive to capitalism?.)