Marx’s Economic Manuscripts of 1861-63
1) Transformation of Money into Capital
Labour capacity is specifically distinguished as use value from the use values of all other commodities. Firstly, because it exists as a mere ability in the living body of the seller, the worker; and secondly (this is something that imprints on it an entirely characteristic difference from all other use values) because its use value — its actual realisation as a use value, i.e. its consumption — is labour itself, hence the substance of exchange value; because it is the creative substance of exchange value itself. Its actual using-up, its consumption, posits exchange value. Its specific use value is that it creates exchange value.
As a commodity, however, labour capacity itself possesses an exchange value. The question is, how to determine this value? In so far as a commodity is considered from the point of view of exchange value, it is always viewed as a result of the productive activity that is required for the creation of its use value. Its exchange value is equal to the quantity of labour used in working on it, objectified in it, and the measure of this is labour time itself. As exchange value, commodities are distinguished from each other only quantitatively, but from the point of view of its substance each commodity is a certain quantity of average social labour, of necessary labour time, which is required to produce, and therefore also to reproduce, this particular use value under the given general conditions of production. Hence the value of labour capacity, like that of every other use value, is equal to the quantity of labour worked up in it, the labour time required to produce labour capacity (under the given general conditions of production). Labour capacity exists only as an ability of the living body of the worker. Once labour capacity is presupposed as given, its production comes down to reproduction, preservation, as does the production of every living thing. The value of labour capacity can therefore be resolved at the outset into the value of the means of subsistence needed to maintain it, i.e. to maintain the worker’s life as a worker, so that having worked today he will be able to repeat the same process under the same conditions the next day.
Secondly: Before the worker has developed his labour capacity, before he is able to work, he must live. Thus if capital is continuously to find sellers of their own labour capacity available on the market, within circulation — and this is a prerequisite for money to develop into capital, for the capital-relation to occur — It is necessary, the worker being mortal, that he should receive, apart from his own means of subsistence, enough of the means of subsistence to perpetuate the race of workers, to increase their number, or at the very least to maintain it at its given level, so that the labour capacities withdrawn from the market through unsuitability or death are replaced by fresh ones. In other words, he must receive adequate means of subsistence to nourish children until they themselves can live as workers. In order to develop a particular labour capacity, in order to modify his general nature in such a way that he is capable of performing a particular kind of labour, the worker requires practice or training: an education which must itself be paid for, and is more or less expensive according to the particular kind of productive labour he is learning to do. This therefore also forms a part of the cost of production of labour capacity. Important as the latter consideration becomes when it is a matter [I-22] of analysing the differing values of individual branches of labour, here it is irrelevant, for we are only concerned with the general relationship between capital and labour, and therefore have in view ordinary, average labour, seeing all labour as only a multiple of this average labour, the training costs of which are infinitesimally small. In any case, the training costs — the outgoings required to develop the nature of the worker so that he has expertise and dexterity in a particular branch of labour — are always included in the means of subsistence the worker requires to convert his children, his replacements, in turn into labour capacities. These costs form part of the means of subsistence required for the worker to reproduce himself as a worker.
The value of labour capacity can therefore be resolved into the values of the means of subsistence required for the worker to maintain himself as a worker, to live as a worker, and to procreate. These values for their part can be resolved into the particular amount of labour time needed, the quantity of labour expended, in order to create means of subsistence or the use values necessary for the maintenance and propagation of labour capacity.
The means of subsistence needed for the maintenance or reproduction of labour capacity can all be reduced to commodities, which possess more or less value as the productive power of labour varies, i.e. according to whether they require a shorter or longer labour time for their production, so that the same use values contain more or less objectified labour time. The value of the means of subsistence required for the maintenance of labour capacity therefore varies, but it is always precisely measured by the quantity of labour necessary to produce the means of subsistence needed for the maintenance and reproduction of labour capacity, or to maintain or reproduce labour capacity itself. The magnitude of the labour time required for this purpose is subject to variation, but a definite portion of labour time — larger or smaller — is always available, and must be devoted to the reproduction of labour capacity. The living existence of this capacity itself is to be regarded as the objectification of that labour time.
Naturally, the means of subsistence needed by the worker to live as a worker differ from one country to another and from one level of civilisation to another. Natural needs themselves, e.g. the need for nourishment, clothing, housing, heating, are greater or smaller according to climatic differences. Similarly, since the extent of the so-called primary requirements for life and the manner of their satisfaction depend to a large degree on the level of civilisation of the society, are themselves the product of history, the necessary means of subsistence in one country or epoch include things not included in another. The range of these necessary means of subsistence is, however, given in a particular country and a particular period.
Even the level of the value of labour rises or falls when one compares different epochs of the bourgeois period in the same country. Finally, the market price of labour capacity at one time rises above and at another falls below the level of its value. This applies to labour capacity as to all other commodities, and is a matter of indifference here, where we are proceeding from the presupposition that commodities are exchanged as equivalents or realise their value in circulation. (This value of commodities in general, just like the value of labour capacity, is represented in reality as their average price, arrived at by the mutual compensation of the alternately falling and rising market prices, with the result that the value of the commodities is realised, made manifest, in these fluctuations of the market price itself.) The problem of these movements in the level of the workers’ needs, as also that of the rise and fall of the market price of labour capacity above or below this level, do not belong here, where the general capital-relation is to be developed, but in the doctrine of the wages of labour. It will be seen in the further course of this investigation that whether one assumes the level of workers’ needs to be higher or lower is completely irrelevant to the end result. The only thing of importance is that it should be viewed as given, determinate. All questions relating to it as not a given but a variable magnitude belong to the investigation of [I-23] wage labour in particular and do not touch its general relationship to capital. Incidentally, every capitalist who for example sets up a factory and establishes his business necessarily regards wages as given in the place where and the time when he sets himself up in business.
//“Diminish the cost of subsistence of men, by diminishing the natural price of the food and clothing, by which life is sustained, and wages will ultimately fall, notwithstanding that the demand for labourers may very greatly increase” (Ricardo, On the Principles of Political Economy, 3rd ed., London, 1821, p. 460). //
//“The natural price of labour is that price which is necessary to enable the labourers, one with another, to subsist and to perpetuate their race, without either increase or diminution. The power of the labourer to support himself and his family does not depend on the quantity of money which he may receive for wages, but on the quantity of food, necessaries, and conveniences which that money can purchase. The natural price of labour, therefore, depends on the price of the food, necessaries, and conveniences.... With a rise in the price of food and necessaries, the natural price of labour will rise; with a fall in their price, it will fall — (Ricardo, l.c., p. 86).//
// The English peck (a measure of corn) = 1/4 bushel. There are 8 bushels to 1 quarter. The standard bushel contains 2,218 and 1/5 cubic inches. and measures 19 1/2 inches in diameter, and 8 1/4 inches deep. Malthus says:
“From a comparative review of corn prices and wages from the reign of Edward III onwards we may draw the inference that during the course of 500 years, the earnings of a day’s labour in this country have been more frequently below than above a peck of wheat; that 1 peck of wheat may be considered as something like a middle point, or a point rather above the middle, about which the corn wages of labour, varying according to the demand and supply, have oscillated” (Malthus, Principles of Political Economy etc., 2nd ed., London, 1836, [pp. 240,] 254).//
If a lower-grade commodity is put in the place of a higher and more valuable one, which formed the Worker’s main means of subsistence, e.g. if corn, wheat, replaces meat, or potatoes are put in the place of wheat and rye, the level of the value of labour capacity naturally falls, because the level of its needs has been pushed down. In our investigation, however, we shall everywhere assume that the amount and quality of the means of subsistence, and therefore also the extent of needs, at a given level of civilisation ‘ is never pushed down, because this investigation of the rise and fall of the level itself (particularly its artificial lowering) does not alter anything in the consideration of the general relationship.
Among the Scots, for example, there are many families that live for whole months on oat meal and barley meal, mixed with only water and salt, instead of on wheat and rye, “and that very comfortably”, says Eden in his The State of the Poor etc., Vol. I, London, 1797, b. II, Ch. II.
That curious philanthropist and ennobled Yankee, Count Rumford, exerted his limited brainpower at the end of the last century in the artificial creation of a low average. His Essays a are a fine cookery book with recipes of all kinds of the cheapest possible grub for replacing the present expensive normal food with surrogates for the workers. The cheapest meal which can be prepared, according to this “philosopher”, is a soup of barley, Indian corn, pepper, salt, vinegar, sweet herbs and 4 herrings in 8 gallons of water. In the work cited above Eden heartily recommends this pretty pig-swill to workhouse overseers. 5 lbs of barley, 5 lbs of Indian corn, 3d. worth of herring, 1d. salt, 1d. vinegar, 2d. pepper and herbs, in all 20 3/4d., provide a soup for 64 people, and given the average price of corn it should be possible to reduce the cost per portion to ‘/4d.
// “The mere workman, who has only his arms and his industry, has nothing unless he succeeds in selling his labour to others.... In every kind of work it cannot fail to happen, and as a matter of fact it does happen, that the wages of the workman are limited to what is necessary to procure him his subsistence” (Turgot, Reflexions sur la formation et la distribution des richesses. (appeared first in 1766) in Oeuvres de Turgot, ed. by Eugène Daire, Vol. I, Paris, 1844, [p.] 10).//
[I-26] // It is possible, on the one hand, to bring down the level of the value of labour capacity by reducing the value of the means of subsistence or the way needs are satisfied, through replacing better by cheaper and inferior provisions, or in general through reducing the scope, the volume of provisions. But in view of the fact that the nourishment of women and children enters into the determination of the level, the average level, it is also possible, on the other hand, to push down this level by forcing them to work. Children are already made use of for work during the time when they should be developing. But we are leaving this case out of consideration, like all other cases affecting the level of the value of labour. We are therefore giving capital a fair chance by assuming precisely its greatest abominations to be non-existent. // //The level can equally be lowered by reducing the period of apprenticeship or its cost as near to zero as possible through simplification of work.//
//The following passage from the Whig sycophant Macaulay can be adduced here, in reference to the early exploitation of children as workers. It is characteristic of the kind of history-writing, and the kind of attitude in the economic sphere too, which, while not being laudator temporis acti, limits its audacity to the retrospective, transferring it into the passive. Concerning child labour in factories, similar things in the 17th century. But the passage dealing with the historical process or the machine, etc., is better [suited for it]. See Factory Reports, 1856.// [I-26]
[I-24] It was naturally of the highest importance for grasping the capital-relation to determine the value of labour capacity, since the capital-relation rests on the sale of that capacity. What had above all to be established was the way in which the value of this commodity is determined, for the essential feature of the relation is that labour capacity is offered as a commodity; but as a commodity the determination of its exchange value is the decisive factor. Since the exchange value of labour capacity is determined by the values or the prices of the means of subsistence, the use values necessary for labour capacity’s preservation and reproduction, the Physiocrats were able to form on the whole a correct conception of its value however little they grasped the nature of value in general. Hence this wage of labour, which is determined by the average necessities of life, plays an important role with these people, who established the first rational conceptions of capital in general.
//In his anonymously published work A Critical Dissertation on the Nature, Measures, and Causes of Value etc., London, 1825, directed against Ricardo’s theory of value altogether, Bailey remarks as follows on the former’s determination of the value of labour capacity:
*"Mr. Ricardo, ingeniously enough, avoids a difficulty, which, on a first view, threatens to encumber his doctrine, that value depends on the quantity of labour employed in production. If this principle is rigidly adhered to, it follows that the value of labour depends on the quantity of labour employed in producing it — which is evidently absurd. By a dexterous turn, therefore, Mr. Ricardo makes the value of labour depend on the quantity of labour required to produce wages; or, to give him the benefit of his own language, he maintains that the value of labour is to be estimated by the quantity of labour required to produce wages; by which he means the quantity of labour required to produce the money or commodities given to the labourer. This is similar to saving, that the value of cloth is to be estimated, not by the quantity of labour bestowed upon its production, but by the quantity of labour bestowed on the production of the silver for which the cloth is exchanged” * ([pp.] 50-51).
The only thing right about this polemic is that Ricardo has the capitalist use his money to buy labour directly, instead of disposition over labour capacity. Labour as such is not directly a commodity, for this is necessarily objectified labour, worked up in a use value. Ricardo does not distinguish between labour capacity as the commodity the worker sells, use value, which has a definite exchange value, and labour, which is merely the use of this capacity in actu. He is therefore incapable, leaving aside the contradiction picked out by Bailey — that living labour cannot be estimated by the quantity of labour employed in its production — of demonstrating how surplus value can emerge, namely the inequality between the quantity of labour the capitalist gives to the worker as a wage and the quantity of living labour the capitalist buys for this amount of objectified labour. For the rest Bailey’s remark is silly. The price of cloth does indeed consist also of the price of the cotton yarn consumed in it, just as the price of labour capacity consists of the means of subsistence that enter into it through the metabolic process. Incidentally, the reproduction of living, organic things does not depend on the labour directly applied to them, the labour worked up in them, but on the means of subsistence they consume — and this is the way of reproducing them. Bailey could also have seen this in the determination of animals’ value; even in the case of machines, in so far as coal, oil and other matières instrumentales consumed by them enter into their cost. To the extent that labour is not restricted merely to the maintaining of life, the need being rather for a special kind of labour which directly modifies labour capacity itself, develops it in such a way that it can practise a particular skill, this too enters into the value of labour — as is the case with more complex labour — and here it is directly incorporated in the worker, is labour expended to produce him. Otherwise Bailey’s joke only has the upshot that the labour applied to the reproduction of the organic body is applied to its means of subsistence, not directly to the body itself, since the appropriation of these means of subsistence through consumption is not work but rather enjoyment.//
[I-25] The necessities of life are renewed daily. If we take for example the mass of necessities of life that are required during a year for the worker to be able to live as a worker and maintain himself as a labour capacity, and the exchange value of this sum — i.e. the quantity of labour time that is worked up, objectified, contained in these means of subsistence — the total quantity of the means of subsistence the worker requires on the average in a day, taking one day with another, and the value of the same needed to live the whole year through, represent the value of his labour capacity on each day, or the quantity of the means of subsistence required on one day so that this labour capacity may continue to exist, be reproduced, as living labour capacity.
Some of the means of subsistence are consumed more quickly, others more slowly. For example, the use values that serve daily as sustenance are also consumed daily, and the same is true of the use values that serve for heating, soap (cleanliness) and lighting. Other necessary means of subsistence, in contrast, such as clothes or housing, are worn out more slowly, although they are used and needed every day. Some means of subsistence must be bought afresh every day, renewed (replaced) every day, others, like for example clothes, need replacing or renewing only at longer intervals although they have to be used every day. This is because they continue to serve as use values for longer periods of time and only become worn out, unserviceable, at the end of these periods.
If the total amount of the means of subsistence the worker must consume every day in order to live as a worker = A, in 365 days it = 365A. In contrast to this, if the total amount of all the other means of subsistence he needs, which only need replacing, i.e. buying anew, three times a year, = B, he would only need 3B in the whole year. Taking them together, therefore, he would need 365A+3B in a year; and every day (365A+3B)/365 . This would be the average amount of the means of subsistence he needed every day, and the value of this amount would be the daily value of his labour capacity, i.e. the value required day by day, counting one day as equivalent to another, to buy the means of subsistence necessary for the maintenance of his labour capacity.
(If one counts the year as 365 days it will contain 52 Sundays, leaving 313 working days; one can therefore take an average of 310 working days.) If now the value of (365A+3B)/365 = 1 thaler, the daily value of his labour capacity would = l thaler. He must earn this amount every day in order to be able to live through the year day by day, and nothing in this is altered by the fact that the use value of certain commodities is not renewed every day. The annual total of his necessities of life is therefore given; then we take their value or price; then we take the daily average, i.e. we divide the total by 365, and we thus obtain the value of the worker’s average necessities of life or the average daily value of his labour capacity. (The price of 365A+3B = 365 thalers, hence the price of his daily necessities of life (365A+3B)/365 = 365/365 = 1 thaler.)