This Outline study course in Merxian economics is offered as a help to instructors of study classes on the first volume of Marx's "Capital". It may also prove to be of value to students of such classes. The Outline attempts nothing more than to suggest procedure, to eliminate a certain amount of preparation and to allow for elaborations by the instructor in each session as well as in the stuay course as a whole. The Outline has already proved to be of some value in elasses on Marx's "Capitel" arranged by the Groups of Council Communists in the United States, and it is hoped that others may also penefit from it.SESSION ONE Before proceeding with Session One the class should be organized and the following reading assignment given: Author's Prefaces to the first and second editions; Hditor's prefaces to the first English Translation and to the fourth German Edition (Kerr Ed.) The ultimate aim of ierx in writing "Capital" was to lay bare the economic law of development in modern society. He discerned the dialectical develoment of the contradictions in the capitalist system of production and was able therefore to analyze scientifically the manifold forms of capital, fran its cellform ~ the value concent, to its most intricate finencial ramifications. It ig known that "Capital" is an application of the dialeot- icel method of thinking to Bconomy. Marxian dialectical materialism has four urinciples: 1. Think conoretely, for everything is concrete. 2. Zverything must be studied in its movoment and dovelopmont, for overything changes continual ly. 3. Whorever contradictions appear, it is necessary te soo their unity. 4. Wo must scok the contradictions in tho procossos of nature and socioty, for ovorything is put into motion by contradictions. Nothing is at a standstill. Thore is nothing static in nature, socioty or mon. Sceicty has its own laws which chango constantly. Each positive hes its nogativo; cach thosis has its anththosis. ovolopmont takes Flese tirougn the noga- tion of both: pesitive. thosis.. snogative santithesis This process illustratos tho nogation of nogetion, cut of Which develops somthing now: this i8 callod tho synthosis, waich incorpcratos the matcrial facts of thesis and antithesis, though now in diffcrent form. The process itself illustrates the turnover from quentity te quality.Thesig: Capital Antithessis; Wage labor Synthesis: Communism The quantitative growth of the class struggle brings about the revolutionary ohange to the new society where there are no capitalists and no wage laborers but freo ani equal producers. Communism thus is the synthesis. The capitelist oless oleim there is only a quantitative dif- ference between the rich and poor — "Some people have more money than others." But this quantitative difference implies also a qualitative difference: the capitalist cless is the exploiter, the workers the exploited. (Explain and illustrate). Quantitatively, one stone is but a stone, cne hundred stones may comprise a'wall and then ten thousand stones may allow the building of a house. From the quantitative proportions of a hundred stones and ten thousand stones may evolve the quaa— Hitative aspect of wall and house. Sooiclogicaliy, a hundred rebellious men are not a menace to the capitalist class; a imndred thousand rebellicus men, on tho aontrary, may consti- tute @ revolutionary force. Marx found the motive powor of sociclogical development in the bless contradictions to be the product, manifestation and the changing activity of the development of the productive forces. In leying bare the economic laws governing capitalist produc- tion, Marz's procedure is twofold: first, he isclates in its order each important feature of the productive process; second, he retraces his steps; that is, hie analysis of the isolates, weaving into his pattern all minor yet essential factors and develops in this way a "complete picture" of the capitalist system of production. "From the conerete to the abstract to an understanding of the concrete.” A thorough understanding of the real nature of capital is ar- rived at only by a scientific’ analysia of capitalism. How ever, this is not an casy task, for many factors; important and unimportant, obscure the value-form of human labor in cap= italist production. Only a knowledge of the inner laws that determine the present social aysten's development will enatle us to see through the smoke soreen of capitalist ideology. Reading Assignment; Chapter I, "Capital (pp 42 to 55). Literature Suggestions: "The Scientific Method of Tainking — An Introduction to Dialectical Mater- ialiam." By Edvard Conze (Chapman and Hall, Ltd. London, W. G. 2, 1935). "anti-Dubring" by'Frederiek Engels, (Chas. Kerr & Go. Chicago 1935).a ION THO Recapitulste with a short talk proceedings of Sesion One. 3 D: fh "The weelth of those societies in which the capitalist mode of production prevails presenta itself as an immense accumulation of commodities, its unit being a single commodity. Our inves- , tigetion must therefore begin with the analysis of a commodity. (pe 41). hat is a commodity? "A commodity is, in the first place, an object outside us, a thing thet by its properties satisfies human wants of some sort or another, The nature of such wants, whether, for in- stance, they spring from the stomach or from fancy, makes no difference, Neither are we here concerned to know how the object satisfies these wants, whether directly as means of sub- sistence, or indirectly as meons of production. fvery useful thing, aa iron, paper, etc. may be looked at from the two points of view of quality and quantity.” (pp 41-42). At the same time, every useful thing contains both use value ang exchange value. "Use values become a reality only by use or consumption: they also constitute the substance of all wealth, whatever may be the social form of that wealth. In the form of society we are sbout to consider they are, in addition, the meterial deposi- toriss of exchange value.” Exchange value, at first sight, presents itself es a quanti- va relation, as the proportion in which values of one sort are exchanged for those 2f another sort, a relation constantly changing with time end place." (pp 42-43). As use yalues commodities differ in quality; as ex values Commodities differ in quantity. oo One hundred pairs of shoes may be exchanged for an automobile. No matter what may be the use value of a commodity, it can be exchanged with another commodity, The quantitative relations enable the exchange. There are use values that have no exchange value, such as air, virgin soil, ocean water, ctc. but there exiat no exchange valves that do not have use However, as soon ss hunan labor is applied to air, the forests, ocean’ water, these alao become exchanges values. Commodities were in existence before capitalist society. But92 cemmodities had attained a certain enly after the cirtule b society aculd real capitalist production degres of devolamment i develop. i Articles in the Indian village were not exchanged on # capital- ist basis because they were not produced for the market. What- ever surplus the natives had in their community they exchanged. This method of exchange, berter, was the starting point of cap~ itelist development. Commodity preduction - the capitalist mode of production - is for exchange, for sale, for the market. Its representatives do not aim to produce the products for their personal use but rather to realize their value in the exchange. (Illustrate). Exchange yelues imply a quantitative relation, such as: ne ton of coal for 12 pounds of tea. - This exchange implies equelity, yet this equality cannot be ox- plained by the bodily substance of coal or toa. As yse values, Goel and tea exe -unliis, Tut as exvienge values they are alike. "Phe valid exchange value of a given commodity expresses some- thing equal. Exchange value, generally, is only the mode of expression, the phenomenal form of something contained in it, yet distinguishable frem it." (> 43). Assume that one ton of coal equals 12 pounds of tea. "What dees this equation tell us7 It tells us thet in two different things there exists in equdl quentities something canmen te both. The two things must therefore be equal to a third waich in itself is neither the one nor the other. Hach of them, so far ag it is exchange value, must therefore be re~ ducible to sg third.” (3.43). This third common "something" hes nothing to ao with the natural property of commodities. The exchange of commodities is evidently an act charecterized by @ total abstraction from use value. "If we leave out of consideration the use value of commodities then they have only one common property left; that of being products of labor.” If wo make abstractions from their use value we see ir the pro- ducts of labor no longer material things, such 23 2 house, table, beox, oto, but only the thing that is common to all: human Jaber in the abstract. — It is labor in general, regardless of its special form of ex- \ s ze » Fes pe. | perditure that ia the substance ef exchange value. eke en rr ceA quaatitetive relation expresses the fact thet equal quan= tities of labor are embodied ia = as we assumed above ~ one ton of coal end 12 lts. of tea. As the quantity of labor is- measured by its time - expenditure, we assume the following equation: 1 ton coal 12 lbs. tea +e. 5 hours se. 5B hours If labor time is to serve as measurement, then it must have as its basis the labor time which in general is required for the production of a given commodity. The labor time of an individval counts as exchange value only in so far as it is the labor time necessary in society. The labor time of all individuals compacted gives the average, or, as Marx calls it, the socially necessary labor time. "The introduction of power looms in England probably reduced by gne-half the lator required to weave a given quantity of yern into cloth. The hand-loom weavers, as a matter of fact, con= tinued to reaaire the same time as before, but the value of Ehedr product Pell to less then one-hsif of its former value.” (p46). Therefore: Commodities in which equal quantities of labor are embodied, or which can be produced during the seme time, have the same value, But from the point of use value the product must be socially necessary, too; otherwise it could not be exchanged (o1 g. hate out of style, etc.). As values, commodities are only definite masses of congealed labor time. The value of a commodity remsins constant if the labor tine re~ tired for its production also remains constant, but the latter changes with every variation in the producttvity of labor. sees 8 hours (constant) +1 how Example: In this case the equation would be: 1 ton of coal s.-see.++ 5 how 60 lbs of tea .. . § hours The twofold character of the labor embodied in commodities. "ab finst sight a commodity presented itself to us as a complex of two things ~ use value and exchange value. Later on we saw also Ghee dahon; boo, posseenca the same twofold nature." (pe48). 1 Let us assume two commoditiss, 1 coat and 19 yards of linen. Assume thet the coat has twice as much valuo as the linen: -S- Sneslinen equals 1 value coat” 2 values Because coat and liron are two qualitatively different use values, they thercia'o represent two different kinds of labor, ramely, tailoring and weavings Were these two commodities nbt qualitatively different, not produced by labor of different quality, they could not stand to each other in the relation of commodities. (Coats are net ox- changed for coats). One use value is not exchanged for another of the same kind. "Division of laba is @ necessary condition for the production of commodities, but it does not follow conversely that the pro- duction of commodities is @ necessary condition for the divi- sion of labor. In the primitive Indien village there is social division of labor without production of commodities. ++sOnly such products can become commodities in regard to each other, as result from different kinds of labor, each kind being ecerried on independently end for the account of private individuals." A commodity is a combination of two elements, matter and labor. "Labor is the father and earth is the mother." (Wm. Petty). If one coat represents one day of labor, then two coata repre- sent two days of labor. With the development of the produc- tivity of lebor we might produce two coats in one day. ‘kn inorease in the quantity of use values is an inoroase of material wealth.” ‘Nevertheless, an inorease@ quantity of material may correspond to @ simltancous fall in the magnitude of its value. This an- Sagonigtic movonent has ite origin in the twofold character of abor. SUMMARY Every commodity has a twofold character: Use Value - Exchange value The natural form - The form it hes in capitalism The value cen only manifest itself in the social relation of commodities: that ia, commodity to commodity. Reading assignmnt: pp. 66 to 96.We have seen that a commodity's val. embodied in the commodity itself. Under capitelism this value is expressed in the money form. ve must, therefore, trace the genesis of the money form. Following Marx's method we deal firzt with A) The Zlementary or Accidental form of value: a) Te Seyards of Tinea equal coat, oF 20 yards of linen are worth 1 coat. "The whole mystery of the form of value lies hidden in this elementary form, Its analysis 1s our real difficulty." p. 56 The two poles: Relative form and Uguivalent form. It is not possible to express tho value of linen in linen. 20 yards of linen equal 20 yards of linen is no expression of value. The value can only be expressed in relation to some other com modity, ¢. g. 20 yards of linen equal I coat. Here the velue of the linen is crystallized in the coat. The coat becomes the eqaivelent to measure the value. In this formula we express the value of the 20 yards of linen bub we cannot express that of the coat, The equation, however, implies that the same quantity of value substance is embodied in both, namely lebor tir "The body of a commodity that serves as the equivalent figures as the materialization of human labor in the abstract and is at the sam time the product of some specifically useful concrete labor. This concrete labor, therefore, becomes the medium for oxpressing abstrect human labor." p. 67 Relative form: 20 yards of linen - 1 coat Equivalent form: 1 coat - 20 yards of linen. The elementary form of value is the carliest form under which a labor prodact appears as a commodity. B) The Botal or Expanded (Extended) form of valuer _ ~~ Toate —_ — or 10 lbs. toa er 40 lbs. coffee 20 yards of linen or 1 quarter of corn or 1 ton of coal or 2 ounces of gold ete.Here the comparison of the Linen's v: Instead 2 single equivalent, 12 in the eleuent of value, we now have @ heterogeneous mess of different equivelents. The ex- tended expression of value is only the multitude of single or elementary expressions. The next higher form of value is C) The general form of value: a IT coat : 10 lbs, tea 40 lbs. coffee 1 quarter of corn each - 20 yards of linen 1 ton of coal 2 ounces of gold etc. Both the earlier forms of value, the slementary and the oxtended are unfit to do more than merely present a conmodity's vaiue as being distinct from that commodity's use value. In the gerieral form of value, the velues of all commoditics not only appear as qualitatively equal; they also appear as compar- able magnitudes. In our example one single commodity (the 20 yards of linen) that is excluded from the rest, becomes now the universal equivalent. The universal equivalent form is a form of value in general and can be assumed by any commodity. "The particular commodity, with whose bodily form the equiva- lent is thus socially identified, now becomes the money commodity, or serves as money." (p.S0) If gold replaces tho linen, we get D)_ The money fo valu 20 yards of Iinen 1 coat 10 lbs. tea 40 lbs. coffee each - 2 ounces of gold 1 quarter of corn 1 ton of coal etc, Gold has assumed the function of the "universal equivalent." It is now money and embodies, like all other commodities, crystal~ lized labor. To produce 2 ounces of gold requires here in our assumption as much labor time as the production of 20 yards of linen. The simple commodity equivalent form is therefore the germ of the money equivalent form. -8-Eetist gities. "A fetish ie a matcrial object, auppossd to possess powers cap able of bringing to successful issue the designs of the owner." (Ylebster's Dictionary). “Why does Marx spesk of the fetishism of commodities? Regarded as 2 use velue there is nothing mystical about a com- modity; it 1s plainly the joint product of labor and nature. ‘Neither does the mystery come from either of the two factors of the commodity's value - qualitative and quantitative labor. The mystery lies in the commodity's condition of being a com- plex of use value and value. Firat, the equality of one kind of lebor with another is not expressed as such equality, it is expressed only as another kind of equality. ond, the quantity of embodied labor time is not expressed as Guch quantity, it 13 expressed only as another quantity. "The products of labor become commodities because the relation of the individual labors of the producers to the sum total of their labor is presonted to them as a social relation, existe ing not between themselves but betwecn the products of their labor." (p. 83). "It is only by being exchanged that the products of labor acquire, as values, She witform social status, atetinet from their varied forms’ of cxistonce as objects of utility, This division of a product into s usoful thing and a value beconcs practicaily important only when exchange has acquired such an axtension thet useful articles are produced for the purpose of boing exchanged, and thoir character as value has therefore to be taken into account, beforehand, during production." (p, 84). The fetish character of commodities disappears immediately when we consider wealth production which is not the production of commoditics, Robinson Crusoe kmew nothing of value, He recognized usoful articles only, To him the means of production were merely in= struments of labor. The sane basta Laws will be velid in the Communist Society. Read carefully Section 4, pp Si to 96, Titeratura: W. H. Srmett's "The Marxian Eeonomie Handbook" pp. 78 to 903 "hat mmunism Really Is" Published by International Council Correspondenoe. — Instructor to assign two members to spoak tofly on (1) The Four Value Forms; (2) Tho Fetishism of Commodities, Roading Assignment for Scasion Four pp 96 to 162, % mG xIn the process of exchange there are necessary not only the com- modities which are to be exchanged but slso the commodity ovm= ers. Cormodities, therefore, stand to each other in a private property relation. To the owner, the commodities possess no immediate use value; to him they possess only value which he hopes to realize through exchange « Commodities are non-use values to their owners, and use values to their non-owers. Hence, commodities mist be realized as valucs before they can become use values, but at the same time they must be use values because only as such ere they exchangeable. For the omer of a commodity exchange in first a simple private transaction, second a social transaction of a general character. Tecthe owner of a commodity every other commodity is, in relation to his om, a particular equivalent, and consequently his own commodity is the universal equivalent for all others. This applies to all commodity owners. Commodity exchenge, however, requires a universal equivalent. Gold, because of ite comparative rarity as well as durability and metallic substance, wes made th: universal equivaicnt: gold deceme money. i Money, op the Circulation of Commoditics. i "Throughout this work, assume, for the sake of simplicity, gold as the moneyesommodity." (ps 106) t In this, as elso in the following sentence, Marx emphasizes i onec more that gold ia merely @ commodity. "Noney, Like every efher o tude of ite volue relatively to oth:r oo! is determined by the labor bime required for its production and | ie expressed by the quaatity of any other commodity that costs | mnodity, has to express the magnis oditics. Its value the same amount of labor time.” (p,. 106, abridged quotation). Sold enables 211 sorts of commodities to expresa and to compare their values.We already ko what determines the velue of old. How- ever, money is merely an imagizary form “hose price depends en- tirely upon the Kind of metal that ia money, It could be either gold, silver or copper; or ail three at the same time as long as the ratio between them remains stat ione: The desire to avoid fluctuations in the retio brought about a fined "standard of price." This standard of price as adapted from the pre-existing "standard of weight," for example, two ounces of gold equal one pound sterling of silver, (The standard Roman pound developed into the modern English pound sterling). As measure of value, and as standerd of price, money is different and has different functions. As measure of value it is labor time converted into gold; as the standard of price it is a fixed weight of metal. As measure of value it converts labor time into gold; as standard of price it measures that gold, variations in the value or price of gold do not affect its func- tion as a standard of measurement. No matter how the value of gold veries, the proportion of different quantities of the metal remain constant. A change in the value of gold does not interfere with its func- tion as @ measure of value. If the value of gold drops, so does the value of other conmodities because the productivity of labor does not occur in one field of production only. When the value of gold (or price of money) rempins constant and the other commodities rise in their value, or whan the value of gold drops and the value of other commodities remain constant, then we have a rise in the price of commodities, (It is, course, assumed here that price is equal to the velue and truly represents it). Under their money names commodities lose every trace of their i valus relation, The question "what is money?" can briefly be answered thus: i 1) Money expresses the value-price of commodities, 2 ) Money is a part of the metal thet acts es the standard of otroulation "hen once a commodity has found a resting place where it can serve as a use value, it falls out of the sphere of exchange into that of consumption, But the former svhere (exchange) alone ine terests us at present. fc have, therefore, now to consider ¢ohaage fro: ‘Al point of view to investigate the change of . form or met: odities which effectuates the social circulation of matter.” (p. 127) We must realize thet commodities (use values) stand opposed to money (exchange value) but that both, as commodities, are unite of use value and value. The metamorphosis takes place in the market. A weaver for example converts his 20 yards of linen into 2 dollars, and then he converts it into a 2-dollar bible. The linen anderwent two spparate conversions, via - linen - 2 dollars - bible The metamorphosis of the linen is complate. The weaver"sold in order to buy.” his process is indicated py the formula C -K- 0 The actual result was-- Commodity for Commodity or simply c c Let us consider the first metamorphosis, or sale, Commodity --- Money The social division of labor which turns products into commodities also enforces the conversion of those commoditics into monoy. The weaver, for example, unable to find a bible ower inter= ested in exchanging his bible with 20 yards of Linon, must sell nig lincn in ordor to be able to buy the bible. The first phase of the metamorphosis (the sale) is immediately linked with the sceond phase (the purchase). Money --= Commodity The weaver purchases for his 2 dollars the bible, As seller he exchanged his commodity with goldj aa buyer he exe changed his gold with a commodity. At the starting point. the commodity (linen) was not a use value to the owner, but at the fin ng@ point it was. ‘The metamorphosis is complotc.The total of all th ferent circuits constitutes the CIRCULATION OF COMMODITIES. Here is the -cifference between barter (exchange of product with product) and the circulstion of commodities. By barter both commodities go out of existence after the trans- action of exchange Ia the money circt some persons In the process - Linen - Money - Bible - first the linen steps out of cirouletion ond money steps into its place, then the pible goes out of circulation and gain money takes ita place. Marx says: "Circulation sweats money from every pore." ion the money slways remains in the hand of It ig,-of course, childish to follow: Because every purchase is 2 sale end every sale a purchase, that by this process we have an equilibrium of ssles and purchases. No one can sell unless he hes a buyer, but no one is forthwith bound to buy because he has just sold. He can keep the money avd can wait to buy as he pleases. If the interval in time between the two complimentary phases of the complete metamorphosis of e commodity becomes too great, there is @ poseibility for s crisis. Read page 128, 6th line from above. much money is needed? Marz: "The quantity tioning as the circulation medium is equal to the of the prices of the commodities di- vided by the number of moves made by coins of the same denomina- tion. This lew holds erally." (p. 135) If the money is only the reflex of circulation, then it will grow with the rapidity with which cormodities exchenge their The totel quentity of money functioning during © given period as the circulation medi on the one hand, by the sum of the prices of the circulating commodities, and on the other hand, by the rapidity with which this process C-H=d goes on, Coins and Synbols of Value There are coing and bullions. The only difverence between them de the shape. To make coins is the 7 the state. Th weight of the coins are fixe yy Tare. Ti treulstion the coins Weer avay. So the function of gold becomes completely independent of the metallic value of at gold. Therefore even things without value, like paper tes, can serve es coins. Only ineofar as paper noncy rep= resents gold it ts a symbol of value, and a means of circulation. s (1) The process of exchange, (2) The cireuletion f commodities. Read pp 163 to 196.eapitel appears. [ey Se. money of the nerohante ig the 16th century). The simplest form of circulation of commodities was: O == i = ° or Selling in order to buy. But along side with this form we find another: Money - Commodity - Money M- = 0 aeeeee i or the transformation of money into commodities and the change of commodities back into mone Buying in order to sell. Moree C ween M The result is: M -e--- M Money for Money) buy for § for $110, then w 00 two thousand pounds of cotton and sell it have exchanged S100 for S110. It would be stupid to exchange “LOO with “100 in the process MeCN. M-C-M mast heve as the result the exchenge of less mone more money Simvle circulation: Cell-C started vith 2 sale and ended with a purchese. THE CIRQULATION OF MON NDS WITH A SALE. TH A PURCHASE AND In the first case the starting point a commodities. In the second, they are goal are In the first, the medium of exchange was monsy, in the second ie is commodities. In the first case money is in the end converted into a commodity, it is spent once and for all, In the form M-C-M the buyer lays out money in order that as a seller he may recover money. He did not spend his money,The leedi e exchange velue. The man who bought nd pounds of cotton for $100 and sold it for +110 r va s form of exchange: M -- C -- M! M' equals H plus ilo "" "100" These additional 10 Marx calls Surplus Valie (8) This movement converta money into capital. * Tyo thousand pounde of cotton are still two thousand pounds of cotton, nothing has changed. But the $100 are now @110, or: Mivereeene- MN oz 10 100 10 In the course of this process the possessor of money becomes a capitalist. The expansion of value M e-= i! is the subjective aim of every capitalist. eeere Co eeeee MT ie therefore in reality the general formula of capital as it appeare in the sphere of cipoaation. — But previously we studied: the equivalent for all commodities is the labor time socially necessary for its production. We did only recognize the exchange of equivelents. And wheFe Squslity @xsts, there Gon be To gains If we exchange equivalents, then even if one commodity is @: changed above ite value, another must be exchanged pelow its pre would remain the sane. Value, but the value as a There Tf a0 Surpl S value. not _bring surplus value. Gapteel In the sphere of circulation. How then is it possible to buy commodities at tveir value and 8 them at their value and still create a surplus? This is the problem: In order to gain surplus value the capitalist has to find a commodity that creates more value then it possesses, This commodity ie labor. power whien is for sale on the merket.ee ee gs to the morket, alue to bim but Labor pover is the oo worker bri To do so, nis labor power must not have any only exchenge vola ~ Thie ia why capitaliem needs FRE What does this maan, Free laborers? Nature does not produce on the one side owners of commodities or money and on the other men that possess nothing but their labor power, This is the result of historical develorment. The value of labor power is determined, as is the case of every other commodity, by the labor time necessary for its production and reproduction. The value of Labor power resolves itself into the value of 9 de- dinite quantity of the means of subsistenee, It therefore varies with the value of these means. If six hours are necessary to produce the necessities for the Production and reproduction of the worker, then six hours are daily necessary for the production of labor power. If six hours social labor are incorporated in three dollars then three dollars express the value of one day of MODIFICATION OF THE GENERAL LAW The consumption of Labor power is at one and the same time the production of commodities and of surplus value. Speakers! Assignment 1) Transformetion of Money into Capital. 2) Buying snd Selling of Labor Power. 197 to 255 Production of Surplus Value. Reading Assignment: - 16 =QUESTIONS =rom wnat tw Gse_value ahe twofold character of value is determined by quantity and cuality. waet does quantity regreseat, en auentity equels exenanze va a what does cuelity re2resent? and quality ecuals use value. aust every exenange value have use value? Yes. imust every ase value have exchanze value? ile. at kind of value is represented by the bedily material form of @ couzodity? Use. Wnat kind of value exresses o sccial relation? Exchange. Cazitalist 2reduction is arcduction for exch: ange value. at is the weasurement of exchinze val what kind of laber de we deal with as the measurement? Simole tract. iat effect ues the development of the productive vower in relation to velug. Increases use value and decreases excharze value. cduction of 5 tons the broduction of 10 yard: then nze § tons f linen linen = 1 coat, 2 value expression? Ye stand here to coat? the equivalent form? Yes. How is tue liner measure #y_its relative velue to the oat An equivalent f; all con nedium of20) Re) 27) 28) 29) 36) 31) 32) 53) Ba) 35) 39) 40) 41) 42) fhe universal equivalent is? Lionsy. weney ig the? iversal equivelent. when we speak of money ve speak of? Golds Dees 4 change in the value of gold affect its functicn as a standard of aeasurement? Nee Tne standard or gcld is? Its Weight. If one quarter cf wheat costs y16, then 15 is cnly the name for a certain . weiznt of gola. Tf v18 exoresses the value cf one ounce of gold, then we ex- change cne cuarter cf waeat for ..-.. gne ounce of gold. Because: fo produce one cunce of gold we needed the same amount of labor time es fcr the sroduotion cf one quarter cf wheat. Simple circulation is ezsres:ed by the formala: © Sellt n order to « iicney is here the ss i mediug ~f exchange, to make O-H-C possible. Is aoardi: of money necessary? Yes. Phe caritalist form of circulation ist K- © - li duying in order tc sell. fae result is ki - 0 ~ it. In casitelist circulation the starting >oint end the goal are? Loney licney is here the ..... capital. The ciroaletion of money a8 capital has as a starting point and goal: . Koney. The money is here not sgent, it is only advanced. 2100 buy 2CCO los. of cotton, and this cotton is again sold for gll0. ub da--- © ---5+ i'. The ten dcliars are then gurolus value. San there be a surglus by the exchange cf equivalents? i San a surplus be gained in the sghere of circulation? No. pitalist nas te find Does it differ uere with any other commodity? If 6 hours of sccial labor are incorperated in 33, and $3 are encugh to 9rcduce and resroduce the labor power cf a worker, then the value cf one day is expressed by .++++y3 ~18-The reading assignment for the lest week covered 58 pages, from p. 197 to p. 255. we had two sperkers assigned: they will deal with the subject discussed in the last session. The first speaker will illustrate "The Trensfornetion of Money into Capital.” The second spesver will elaborate on "The Buy- mg and Selling of Labor Power." Make necessary corrections. Repeat the important points and then introduce the new chapter. THE PRODUCTION OF The capitalist buys labor power in ordér to use it, and labor power in use is lebor itself. What the capitalist makes the laborer produce is a particular use value, @ specificd article, a commodity for the market. Labor is, in the first place, a process in which both men and nature participate. Man sets his body in action to appropriate from neture what he needa for his specific wants. Human labor is different from labor of other species. A spider makes a good net, and a bee a good cell, but what differentiates human labor from this is the fact thet a human being creates his work in his imagination before he erects it in reality. ature gives man only the raw maverial for his work. This rav material is at the same time the msterial for the tools man needs. Franklin defines man as a tool making animal If we want to understand the past, we not only have to seok for the bonee of the fossils, but the past of society can best be understood by locking at the tools ‘shat were used. It is nob the articles made, 1¢ is how they are made, and by what instruments thet enables ae to a guiek erent economic periods. They show us at the sang tine the social condition under which lator as carried on. (Illustrate with the pyramids in Egypt, the cabins, the tmpire State Building, etc.). -19 -Products ‘ere not ¢ but elso essential conditions of labor beceuse one follovs the otier. the means of production in the capitalist society are: Raw materials, all the and means of transportation, machines and tools. 4& machine as well ag 211 other things which do not serve the purpose of labor are useless. It will decay! iron rusts, wood rots avaye. aber aas to give tiem lite. Let us follow a capitalist in iis transactions. ne buyes labor on the market. He alse buys the means of pro- duction. Then he tne labor power. The laborer works ue control of the cazitalist; the cayitalist takes cere that the work is done properly so that tne seans cf prodaction ere not sacilea or wasted. The product belongs te the capitalist; not to the real producer, tue Worker. labor process is &@ arccess between things that the capitalist purenased and tainzs that heve become nis property. talist produces a°¢ values: shces, hats, etc. Guce not only use values, 2ut com ver, modities; not only + Jue but value; not only value out sur- plus value. (semezber? 2 --- 0 --- A") Tnerefcre, the grccess mast be on value. comsodity is determinca by the d naterialized in it, by the social conditions ,for its orc~ under the casitalist mode working time n éuction. Jnis Jas. of “arn. lized in it. ose we need 10 Ins Gne casitalist has bough (de beugat the cotton fo: for tue reduction of .i cf ais macaines 10 Las. of ¥10 lbs. of cotton « bxamgle age ci wachinery 4. (2 gays labor) (1 24 nours of labor, or two working deys, ere required to y duce tae cnantity c2’ sold regresented by twelve dollars, we nave to begin here with two Gays labor that are already in- cor jorated.) If in one hour 1 £/3 lbs, of cotton can be s.un into 1 2/5 lbs. ct yarn, then 10 1bs. cf yarn indicate the absor jtion of six acurs of labor. 10 lbs. of cotton transforned into 10-lbs. of yarn in 6 hours. Six hours of labor are also embodied in a sicce of gold at the value of we Thus, by the spinning precess @ valuo of 73 is ad/ed to the cotton. 10 lbs. of cotton . use of machinery + 6 nours of spinning ‘10. er an ae scarasesdiel (BS 10 lbs. of yarn #15. 30 hours of labor, or 2.1/8 days. is converted into cazital. surplus value is cree capitalist price on tne market is #18, and y15 is Sdvanced. 7 {vuere is no surplus value created in cireulation). But let us see tais 2rcces3 froma difierent angle. awe assume the value of labor joer neurs) are endodied in that quantity Therefore, the value cf labor por labor power creates in the labor ence of the two values is ¥ as purchasing the labor and this diffe in view suen he : The ca italist we deal with knors t factory after the produc 10 1s. Jets tue work run for 12 hours. -21That means he vroduces 20 lbs. of yarn and will sell these 20 lbs. for 30 dollers. Now let us look at this process: 20 lbs. of cotton .+. 48 hours or 2 days labor use of machinery ....-% 4 12 hours for spinning 9 3 12 hours or 1 day labor per 60 hours of labor or 5 days he sells it for $30 Surplus ss... 8 3 Ke started out with $27, produced $30 i G id +. The value he has now is 1/9 larger than the advanced value. Money has been converted into capital. Equivelent hes been exchenzed for equivalent. The capitalist paid for everything he bought the full value. The process cf creating surplus value is nothing else but the continuation of the production of value beyond 4 definite point. 6 hours no surplus, 12 hourg $3 surplus. Constant and variable capital (Chapter 6). Surplus labor creates surplus value (6 hours more). The values of the means of production used up in the process are preserved, and present themselves as 2 part of the newly created product. In 29 yards of yern are presented $4 cf sent machinery (wear and tear/. of the means of srcduction is This transfer is brought t by labor. By tae very act of preducing new values, ne preserves their value. Bach use value in the labor orocess disapgears, only to rea under 2 new form in a new use value. Cotton is gone, the spindle is gone, the work is gone, but yarn is there which has all these things incorporated in its! If we apply in this precess the Development of the productivity cf labor then we have this result: ~22 eeeof cotton material. in a given time, the transferred from it to The Longer the into yara, the greater is The greater the veight of greoter is the value preserved the product. ~ a If, due to some invention, we can spin in six hours the same amount of cotton we have spun before in 36 hours, then the pro- net of 6 hours labor has increased 6 times 6, But the value is now only 1/6 of its former value. The product, however, thet is preserved end transferred into the new product is six times greater. How is the value of machinery and raw materdal transferred to the new product? Some raw material, coal, ofl, etc. vanish as use values at once, Others (tools, machinery, etc.) only partly. During the working time the machine's use-value vanishes and by this its exchange value is slowly but completely transferred to new products, If a spinning machine lasts 10 years, ite total value is grad- gally transferred to the croducts during 10 years. Means of production never transfer more value to the product than they themselves lose during the labor process by the de- struction of their om use value. A machine is worth $1000 and lasts 1000 days, then #1 a day will be transferred as value to the product. The means of production can never add more valus to the product than they themselves possess indexpendent of the process in which they aseist. That part of capital, then, which is represented by the means of production undergoes no quantitative alteration of value. That is why Marx called it the constant part of capitel, or shortly the constant capital (c). The other part of capital that is represented by labor power reproduces the equivalent of its own velue and also a surplus value. This part makes cepitel bigger, enables the change from less to more, That is why Marx called it the variable part of capital, or priefly, variable capital (v).The Rete of surplus Value. (Chaptus 9} Capital "C" is made up of two components, one, the sum of money laid out ugen the mea: ox ecduction, and the other, the sum expanded upon laber power (wages) "V" . 6 -- constant capital, V ----- variable capital. we nave first: GC Ss c-¥ : BOC = 410-90 ithen the proces of groduction is finished we have: © v 3 410 90 90 590 the difference is 3 or surzlus. co te-v 800 3 : 990 expresses the avsclute quantit oduced. fhe relative quantity orcduced, or tue increase ver cent of the variable cajital, is determined by tue ratic cf tas surplus value to the variable cavital, or is exzro -ed in tie formila+ s v In our example this ratio is ch increase cf 10! (Remember, the variable art alone creates surolus, so one tue rate cf surplus value can %e dravn.) r gets curs 33 the 6 ho re necess even without working for “order tc life necessities b him to- live. @he essential dificrence between the various economic forms cf sceiety, Yor instance, vetween @ sccizty based on slave labor, and one based on #a;e labor, is taat in each cage At ig extracted from the actual producer, the TedOre Ty we gy Saget ~24~ Pe eR RST TESS TESS REI NO AS EE VT ITEThus the rate cf surplus value is determined by the rate ef sur- plus labor. g : surplus labor ¥ : necessary labor beth egress the same thing ~ in different ways. erefore an exact expression for er_by capital, or of the The rate of surplus value is t the degres oF exploitation cf worker by the casitalists 3: 90 : 100% : Surplus labor hours hours : $3 y 36 Necessary Taber. Snours 93. The laborer here works half the day for the capitalist, the cther hel? for himselfs 243) ixample of production for profit: (Pp Spinning mill 1,000 spindles orcducing 10,000 Ibs. of yern weekly. Gp waste, consum tion: 10,600 lbs. of cotton weekly. 1C,000 sgindles ecst 910,000 Ta se they cost yearly 91,000, weekly are goot for ten years. =- $20. Vse cf mackin ry weekly 10,600 los. of cotton .. Rent weekly . Gcal, sas, oil, ste Constant opital veekl, (variable ca ital Tywee tly) Cost of the rice for yarn ist Ccst of sroduction Constant pert So we put oe v 13 3 61/2 hours. aim of eapitel- antity of us is the chi t be measured by the ¢ Since the groducticn list production, 211 extreeted surplus value ans ignmont for ignm nt ~26- ace OR A RST ATE TELE RN EEee Suss Lov In cur last sessicn (pp.197-255) we deait with the production of surplus value, constant and variable cazital bs d the rate of sar- plug value. Assignments were given to three speakers. plus Tabor time surplus labor and surplus value The second eponker will speak abcut 20 and veriable capital Is Oonstant ca) oduetion, raw a tocls, machinery. Variat es. Only variable capital can Greate surplus value. ihe value of the constant ca:ital is trans- ferred to the new srcduct. ermines the ere sferent ene If tue rate working @ay vas out 3 irglus value n labor time is neces-The working day hes & No man can work 24 hours at aj] times. Difference of working days. fore time for recreation is required fcr vetter work, time te study, etc» That is the reason for shortening the working day, hot cnly through the struzzle. oagitalist bougnt the laberer for the whcle day at his value. But woat is a working day? It must be less than the natural day. However, because profit is the only aim of ca italist »roduction, the capitalist must oy all weans try to get as auch surplus labor out of the worker as vcossible. Lierx: "Casitel is dead labor, that vampire-like, lives only by sucking labor; tne acre it'’sacks the more it lives". 9.27. valus. The capitalist does so He pays wita tue value working day? xX reconstructs leaflet the w Mt e Bnslan@ in 1660 which said that, tue worker lives 30 years, tuen tne value of wis lebor 2c er would de: tc death then, in perhavs 1 or capitalist 2 determination presents i nit of & getween collective ca and the wherever a pert of society > of groduction, tne labcrer free rking tine necessary for his oun time in er to srodice tin rs of the seans netIn the feudal system ths serf worked 5 days on his own field and 3 days on the field of the feudal lord. In oazitalism this 5 is not so distinct anymore. The worker does not work six hours every day for the capitalist, and six hours for himself, but tne surplus labor and the necessary labor combine with each other. ‘We oan express the surplus labor just ag well by saying, he works 30 seconds for himselZ and 30 seconds for the cazitalist. Sternberg's theory ist “If there were less laborers, ex- ploitation would not be pessible. The capitalist would have to bid 30 nigh that nc surlus could be derived.” This theory is unsound. erivete property and urivate ownership of the means of pro- d@uetion is"tae taing that counts", peasible. which makes exploitation niea srcducticn is interupted ana the ? TIE" for only a part cf the week, lly do not aifect the tendency to the working day. 8 business there is, the more crofit has there been on tue business done. ke less tims sent in work, the of that time nas to be turned into surplus labor time.” aiarx gives tae aistory of the exploitaticn of men ghildren in Englisi industry. See unzels "Situat laboring class in sng Night work: Ccnstant ce sital 13 of production, considere* from tae standpoint cf 3 oduc surplus value, only exist to b lsd: Livery workil brin fits 30 the ten- dency cf capital is to wave wi 24 hours if soseible. cgyitalist dses not care for the e holder did not eara for tue slave @ slave was exploited for the mark ploitaticn was more orcfitable to lifetime work of tae slave. liah bakers to death, % from Poland or Germany. tuey wore bern fastor than they died. Capitalism has ite cvm law sf vepulat Birth contrel. onus for the birta of the 8th ¥illing of workers, s cn of population be practiced 238 lo: s orcefitable. ~28-The clase struzglo was a fignt for tan 16 hour day instead of the 16 hour, and fcr the 19 hour instead of 16 nour day. And i when the workers had the 12 aour day toe cazitalist said that ' it would ve impossible to make a vrefit chat way. they fought } in the intercst cf the human race and in the name of good Going against the saortening of the working day. The 8 hour strugzle in the U.S.s., Haymerket Afiair. liarx gives us the uietory of the struggle for tne shortening of the working day. Tho -#rench “ebruary Revolution was necessary te bring about tho "In the United Sta es every indezendent mevement of the 73 was paralyzed so long as slavery disiizarod a part of the Republic. abor cannot emanzipate itself in the white skin where in the black it is branded.” Rate and lass of Surplus Values We new thet the working day detertincs the rate of surplus 6 said a worker hag to wrk (as in our example) 6 hours for nimself and six for the capitalist. he rate of surplus value would be 16 labor glus six hours surplus ssed in 2 quantum of six = 93, then 93 is th daily labor 3cwer of rker. 3y hundred workers it mould be #300. 4 factory with workers would daily noed@ $3CO variable ca ital. The wass cf surplus value, too, wopld ta it in gola. be 9300, if e express arx:" The sarplus tiplied by the n surplus value produced is there a the working day of one labcrer supslics, mul- er cf laborers cuployod". 9.331. In our exemple the rate und the mags of surplus value is the samc. The mass is ¥30C, the rate 100}. If the rate surplus value would ameunt to 5C% only, thon tho aass of surplus value, with the seme amount cf labcrors, would be 3150 or 100 laborers Zroducing instead of six hours only three hours surplus yalue. If the rate of surplus value is 200,, the 3 Would be 3600, cr th8 100 workars would have rk ig hours surplus labor.If the caritalist would set pid of 50 workers, he would start ut with $160 variable oa ital. He could get the same amount cf surplus oy lengtuening the working day. 300 variable capital : 190 workers BO surplus rate:y15C ital 50 workers 100% surplus rate :$150 150 variable ¢: Intensification of work due to the development of mechinery~ jie will deel with the sroblem cf all these variations when we take up relative surplus value. At present we must take notice of this tendency: The rate of surplus value nae its limits, as well as the mags of surplus value. In the chapter om accumulation of capital --which is most im- portant-- we will deal with this difference between the rate And the mass of greZit thoroughly. Today we will deal with it only briefly. = 100 workera - 16 he 260/ 9300 veriable capite rate of surjlus ve ur working day - Thais produces a mss of surplus value of $6CC or 12 x 1C0 hours. rking It_can never reach $1200 or 24 x 100 working hours. The absolute limit of the uverege working day is by nature always less than ®& hours. Thais sets an absclute limit to the compen gation or the reduction of variable by a higher rate of surplus value. It is one cf the mein contradicticns of capital to reduce as mech as possible the number of labcrers employed by it, or its variable pert, and the tendeney to produce as much ss possible survlus values The greater the varieble of velue and surplus value. given, the wass fhe mass of labor tact ter would be th he working a s only dependent upon ; With a given rate of surplus value and a given velue of labor ypewer the mess of gurplus value prcduced therefore varies di rectly in accerdance with the amount of the advanced variable capital. ie know that the constant part dces not croate velue but only trensfers its value tc the new product. =30- VWSo there stands 2s a law? That the mass of value and the surplus value produced by dif- ferent capitalists, tie value of labor power being given and its degree of exploitation being equal, very directly as the amounts cf the variable constitute parts of these capitals. The labor whish is set in motion by the total capital of a society may be regarded as 2 single collective working day. The number of workers as a million and tue Bing day (average) of a laborer 10 hours, then the social working day would consist of 10 millicn heurs. Here the mass of surplus value can only be inoreased by in- oreasing the numver of labcrers. [ne growth of the population is here the limit to the :roduction oi surplus value by the sccial capitel. 3y tais it follows that not every sum of money can de trans- formed into ceritel. @aere is © minioum, a certain limit a man must possess, before he can start production for prefit. The minioum of variable cazitel is tue cost 2rice cf a single laborer, employed for the oreduction cf surplus value. fe make a living, the capitalist would rave to exploit this sborer 100%, and tren ne could only live like the laberer. if he would like to live twice as good as the lzborer, he must advance twice as much capitel. In order to prevent the guild masters in the middle ages from becoming capitalists, they were forbidcen to hire more labcrers which would nave brouzht them more surplus value. So the possessor of money or coamedities actually vecame 2 capitalist in such cases only wheré the mininum sum advanced for the yroduction greatly exten: maximum of the miidle ages. Heve the Hegelian dialectics show a differences beyond a certain point antitative into qualitative changes". The minimum of capital to stant s with different stazes of development. Scue spheres of oroduction need so mh money for ro individual hag enowsh to tackle nis alone. i state suvsidies and the joint stock comsnies. Reading assignmen Dp. 342-404. kers' assignmeat: 1) The working day, 2)'3 suertening of the working day, 3) Rate and mass value. -31-SESSION ut The reading assignment for the last week covered 62 pages (342-404) Wie dealt with the working day, strugzles for the shortening of the working day, and we took up the question of tne rate and mags oF surplus value. Assignments were given to three speakers; The first speaker will deal with the working day; the second wil] tell us something about the struggle for the Shorter working day, and the third will deal with the rate and mass of Surplus value. The working day is a variable quantity but it has its absolute limits. Question: what are these limits? biaximum limit; The working day cannot be more than 24 hours. Kinimum limit: Tne necessary labor time. Surplus value is nothing but surplus labor time, Guestion: Suppose, the necessary labor time remains constant, wnat has the capitalist to do to raise hig orofit? Question: whet could he do during 4 crisis in relation to the Working day? wuestion: Why was the class struggle in the upward swing of Gasitalism a fight for the shortening of the surglus labor time? What was the result of this struggle? Second speaker: Ths fight for the 12 and 6 hour day. Suestion: Can the class struggle still center around the issue of shorter hours? Third speaker: Rate and mass of surplus valuc. @ho working day determines the rate of surplus value; A B-¢ A ---- Bs 6 2/39 Example: $500 variablc capital - $300 Surplus valuo = 100% $300 variable capital - 150 surplus valuc = 50% $300 variable capital - $600 surplus value = 200% -32-@xampic: 300 ¥ = 100 wWorksrs » rate of surplus 60% = $150 Yeo v _ 80 workurs - vote of surplus 100 =$150 sur~ plus valuo Limits: 300 v = 100 workers - rate of surplus 0% - g00 sv Zoo v - 100 * -"7 8 ~ 9600 8 ¥ 300 v - 100 ® « * * = 7900 sv 300 v - 100 " ~ * e -3? Bor 400% there would be necossary a day of 30 hours which is im possible. Ig the worker would work 30 hours then he woald havo orcatcd $1200. that has to bo donc to got this amount of moncy? 600 v - 200 workors - rate of surplus 200% - $1200 s v 1200 v - 400 ° -_7 8 "100% - $1200 5 v e400 v - 600 " - % « "50% ~ $1200 s v 4600 v -1600 * sn 26% fi sv 9600 v = 3200 # a # i. 4 122 - $1200 s v Give hourly proportion octwoen ncecssary labor and surplus labor. With a givon rate of surplus value ard a given value of labor power, tho mass of surplus valuc producod therefore varics dircet- jy as the amounts of the advanced variablo capital vary. 9600 v = 3200 workers - rate of surplus 200% - $19200 s v 4800 v- 1600 " =F Ww 100% - $4800 sv 2400 vy - 600 * em 4% 50% - $1200 sv 1200 v~- 400 *% -" xf 25% - $ 300 sv 600 y ~ 200 = - 7" " " 12-8 75 sv Tho mass of value and surplus vi casitals --the value of labor p of cxploitation being oqual-- the variable parts of thosc capitals. us produced by difforont r boing given and its dogroo dircetiy as amounts of Not overy sum can uc transformed into capital. The Minimum: Tho cost gricc of as good as tho laborcr,cmploying ingls laborer. To live twiee o laborcrs is nocossery. Bxplain why the guild master i @ capitalist? ddie § could not become Tho possessor of moncy or commoditics actually turns into a capitalist in such cases only * the minimum sum advanced for the production cxc.cds tho maximum of the Middlo Age —38=Hegelian Dieloctics: Chanz¢ from quantity to quality. Question: Explain joint stock companics, State railraods, ctc. Pert IV, Chapter 4IT Until now vc heve dcalt with absolute surplus valuo - which means that surplus valuo is detcrmined by surplus labor only. That portion of the working day which meroly produccs an cqui- valont, and not thc yaluc paid by the capitalist for tho labor poccr, is alvays lookud at as the constant part of capital. ~ B---- Aone BAC A ----- B20 A - What varies hore is the surplus Jabor times B ----C. Now lot us assumo tiat wo havo a given working day of 12 hours. 10 aw B 26 Sele The length of A -------------- 0 may be giyon. “o assumo that 0 cannot chango anything. Tho only possibility to lengthon h or inercasc the surplus, would be to move 3B towards A. c A waeenene---B ------B --- The extention of the surplus labor timo forecd us to take some time evay from the nceussary labor timc. Et , thon, have an alt a 7 but in its di ration, not in the longth of the working into noowssary and surplus labor timo. Bat we claimed et and so thure this possible. that: the work:rs paid for their value t to mako be a drop in the valuc We will hold to the proposition thet 211 commoditics, including labor power, arc bought and sola for thoir value. Thy fall in the samc noecsaities of life could now be produccd in 9 inercsss in tho productivi tnat productivity of values. The inercas: in t ductivity of labor is the labor preecss shortens tho tims socielly n the production of cou.oditics. 4 ntity of la produca’a groater auantity of uso ith thet th arcps.Ths technic conditions, the mode of production, must be revolutionized before the productivity of labor can inercasc. Marx called the surplus valuc produccd by prolongation of tho working day: abs c¢ aurplas valu. Ths surplus value produecd by shortening the nocssary labor through tho dcvclopmont cf the productivity liarx oallod: relative surplus voluo. 4n inercasc in tho groductivity of labor in thosc tranches of in- dustry which supply neither tho noocesitics of lifc nor the moans of production required for the sroduction of the nucossitics life Icaves the valuc of labor powur undisturbcd, sucn as diamonds, ox flowora, playing cards, oto. Tho capitalists do not cheapen t! creasing tho productivity of Isbor. commoditios consciously by in- (p.347) "It is mot our intcntion to consider here the way in which the eduction, manifest thom sclycs in the movements 23308 of onpital whero they sssort themsclva @ competition, 7a thoy sppear in tho mind 2f could not undcrstand competition before 3 ne innor naturs of expitelism. And this innor 1 und without taking com petition inte consideration. xdy b2sod on the theory of vxluo. But of competition :nd fina cut ne in rol-tion to ecmp. the creation ion. mls? 1 hour of inbor - $1 1 day of 12 hours ~ 912 heurs cf l-ber produce 12 shirts. né price cf one shirt is $2, 12 shirts - $24 are formed inte shirts trom the constant port cf (material, cf oxploitation is 5Oj. i ing 12 shirts tho etpitalist mikes 2 surplus of $6. t 0 Throug: ention he th of Inbor 100%. of Inber is still $1, 12 # 24 ahirts aro produced inste The price of the shirt is still 2. yl Arc now transferred into the shirte from the constant port of onpital. ane * surplus of $24. m4 productivit hours - $12. 12. If he sclls 21] 24 shirts 4 At first it tock this o Now it only trkus nim $ hour. If mkes $24 instexd of $6, during ist 1 hour te preduce on s 1b. ~35-But-now ho nog to find 2 markot for 2% shirts instozd of for 12. His wish docs not mko the markct largcr to absorb his @% shirts. All the other. grcducers of shirts who hove not applicd the now invention still produce only 12 shirts during the day. Wo learncd already that the rcal valuo of a commodity is not its individual veluo but its sociel value. The real value is not moasured by tho labor timo that the article in cach case costs the in@ividual producer, but tho labor timo socially required for its production. gusstions If this capitalist could get rid of his 24 shirts at the "social price” of $2 och, ho would soll his shirts over their valuc, over their produetion prico. In this case, 5/4 over their value. However, in order to get rid of his shirts he has to take tho markot away from others. But if the possibilitics of the markot arc the samc, thon in order to zst rid'of 24 shirts, ho must sell cheaper than’the others. He has te soll the shirt, oven if he solls them over thoir indiyiducl veluo, undor social value. He will sell the anirts for $14 cachi Thon he will got only $36 for his 24 shirts. He still has twicc 2s much surplus as befors jue) but at the samo time ho sells the shirts below their valuo social v ade Now, the other capitelists vill be forced to apply the samo mothod and’in tne long run tho shirts will azain bo sold at their social uc. There is an individual motiuein every capitalist to ehogpen his commoditios be incrossing the productivity of labor. And in this proccss waich is appliod to overy commodity, the value of labor power is decronging with the inercase in usc values. This’ inereesod production of surplus velue arises from the ourtail- ont of the necessary labor time and from the corrosponding pro- Jongation of surplus lebor. -----B - neni Relative surplus velus riscs and drops with the productivity of Jabe Marx: "The objcet of 211 devolopment of product within the limits of capitalist production, part of tho working day during which the we his own benefit, and by that vory shorteni other part of the day during which be gratis for tho aliste™ p.352. we have eady scon that capitalist oreduction only whon thore is 2 j08sibility to oxploit many when there is cnowgh capital on hand to do sc.a groator numbor of workers working together in one place, in ordor to produce the simc sort of 4 commodity under the master~- ship of the capitalist, constitutes, historically and logically, the starting point of capitalist production. The dovelopment of production from the middle ages to capital- jam was at first only 2 change in quantity: more money was noc- essary to hire more laborers and the cnlarging of the workshop of the mster craftsman. The number of workers did not, as we have scon, affect the rate of surplus value but the mass. But the mass of surplus value varies with the number of workers omployed. If a capitalist employs one laborer who may be an cfficient worker, tho cap- italist makes a good profit. Another wrker may not be as good and therofore the capitalist would make less profit on him, But if many workers aré employed, the question is no longer that of good cr bad workers, tut their labor is figured on the average. Tf one worker is mare efficient than encther, then the average amount of work they perform is neither good nor bed. If one worker puts out four shirts during the day and the other worker produces siz, they both prodwe 10, or an average of 5 shirts each. Cocperation of labor is necessary in capitalist production. Example; also give illustration. A bigger capitalist oan produce mcre economically and cheaper. Not only a minimum for variable, but also a certain winimum fcr constant capital ig necessary to produce successfully in a cep~ itelistie way. This is why the big capitalist can eliminate s smaller competitor. Later cn we will see that even in competition there are fundamental contradictions. Cooperation is cosbined with division of labor. In Chapter XIV, Marx gives 4 good illustration of the develop~ ment and consequent results of the division of labor and mant- facture. (Use the stockyards and the ford Motor Plant as examples in illustrating the latest results in the division of lebor. In the beginr rker produced the ecuplete rr o- duct. The modern yr, on the other hand, performs only ono operation in the large factories whore mass production is carriod on). The result of the labor of the one worker in a large factory is tho starting point of the labor of another. Since the Collec- tive laborer has functions both simple and ccmplex, the indivi- dual laborer requires difforent oducation and must therefore have different values, or higher end lover wagos.It develops in a factory inthe same way es it develops in soc~ dety as a wocle, but here it finds its limite in the private property reletions and can only be freed ina communist society, he anerehy is siowly vanishing, gut camnct be done away with completely in capitalist society. (A capitalist planned economy is not possible). Reading assignment: Pages 405-556. First speaker: Relative surplus value. Second" Cooperation and Wivision of labor. Thira " Division of laber in manufacture and in society.SESSION NINE Session Bight, pages 342 to 404 dealt with Relative Surplu Value, Gocperation and Division of Labor, Division | emitao~ ture and in Society. Three spegkers were assigned. The first will speak on the con- ception of relative surplus value. The second on the coopere- tion in capitalist production. The third speaker will tell us scmething about the division of labor in manufacture and in “society. The mechine is a means for producing surplus value. In the beginning cf capitalism, in manufacture, the revolution in the mode of production began with labor-power. Cooperation and division of labor is only @ process of arrangement of work and workers. The revolution in the mede of production in modern industries has its beginning in the development of the instruments of labor. The machine is a mechanism, performing the same operation that was formerly done by workmen. Marx deseribes the dcvelopment of the machine. It has grown out of the cld-tcecls. A pump was still a pump, but driven by an engine instead of by arm-power. The machine dcvelcps the machine. So came the production of machines by machinus. (World market, mass production, from one process te another). The productive forecs resulting from ésoporaticn and @ivision of labor costs capital nothing. (Question). They are the natural forces of scoial labor. The arrangement of production is an cxamplc. ory, as ell the other perts of constant capital, neither nor adds, value te the new product. So instead of becoming clpaper, thc produits of the m should be doarer, as theso contain part of val machina. ino machine, theugh always enteri ng progoss, enters in the value begetting process only artially. ' Cn an average, by wear and tear, it nevor adds more value than it loses. as a whole in the labor- a =39-SESSION NINE Session Bight, pages 342 to 404 dealt with Relative Surplu Value, Gocperation and Division of Labor, Division | emitao~ ture and in Society. Three spegkers were assigned. The first will speak on the con- ception of relative surplus value. The second on the coopere- tion in capitalist production. The third speaker will tell us scmething about the division of labor in manufacture and in “society. The mechine is a means for producing surplus value. In the beginning cf capitalism, in manufacture, the revolution in the mode of production began with labor-power. Cooperation and division of labor is only @ process of arrangement of work and workers. The revolution in the mede of production in modern industries has its beginning in the development of the instruments of labor. The machine is a mechanism, performing the same operation that was formerly done by workmen. Marx deseribes the dcvelopment of the machine. It has grown out of the cld-tcecls. A pump was still a pump, but driven by an engine instead of by arm-power. The machine dcvelcps the machine. So came the production of machines by machinus. (World market, mass production, from one process te another). The productive forecs resulting from ésoporaticn and @ivision of labor costs capital nothing. (Question). They are the natural forces of scoial labor. The arrangement of production is an cxamplc. ory, as ell the other perts of constant capital, neither nor adds, value te the new product. So instead of becoming clpaper, thc produits of the m should be doarer, as theso contain part of val machina. ino machine, theugh always enteri ng progoss, enters in the value begetting process only artially. ' Cn an average, by wear and tear, it nevor adds more value than it loses. as a whole in the labor- a =39-There is a great difference between the value of the machine and the velac transforred to the new vroduct. he longer the life of the machine the greater is the diffcrcnes Given the difference between the value cf the machinery and the value transferred to tac new product, tho extont to which this latter value makes tue product dearer depends on the mass of the product made by tho machine: The preduetivity of a machine can only labor-power it replaces. bs measured by the human IZ it costs es mic lavor to produce e maching as is saved by he employment of the machine, employment of the macaine would be senscloss. Thercforc, no ineroasc in the productivity of labor. Machine Production in capiteligm,. thereforo, has its absolute limits. Capitalism uscs or develops the machine only so long a3 it reduces tho cost of production and increases profits. If a machine weuld save labor tut its application would cost more than the available laber--power, the machine would not be introduced. The use of machinery for the exclusive purpose of cheapening tho products is limitod insofar as loss labor must be oxpended in producing the machinery than is displaced by the omployment of the machiner, Absolute Limit: Invontion of a machine that enables us te out down transporta- tion of 100,000 tens of goods between Chicago and New York te B hours. Without the new railroad te transport 100,000 tons had to put in 200 workinz hours or 2000 working hours for a illicn tons. But this no kot railrcsd lasts only 10 trips on account of the speed and tho special building. 1d have this result: Old railroad 1,000,000 --- 2000 work: Now railrced 1,000,000 --- 2006 work machine may be a very smart invention but it could not be usod for it would not have inorossod tin productivity. What docs the development of the machine Tho machine, by roplacing direct muscular powor, made the ox- ploitation of women and children possitlc. 3y this, value cf the labor > not, as before, determined by the nec~ assitics to maintain the adult laborer with his family, but 40~Se ee : P : 3 by throwing every mombor ez his family on the lebor market, sproad tho valuo of the labor~powor of this man over his wh ole family. At fikst, the income cf one could feed fcur persons. Now with four persons working, the income of feur could only feed four. The capitalist could pay the worker less. The value cf labor- power decreased on this account. Marx gives some gcod illustrations tc what extent children and women were exploited. In the United States in 1936 there was still one-half million children working in the industries. Wo said, the longer the life of a machine the greater is the mass of products but the amaller is the value transferred te each single commodity. The active lifetime of a machine again is based,on the length cf the working day. The wear and tear of a machine is net exactly proportional to its working ti 4& machine working daily 16 hours during 7 1/2 yoers and = mach- ine working daily 8 hours during 15 years transfors to the total preduct tho same valus, but the transfer took in tho first in- stance enly 7 1/2 yoars. Tho capitalist gets his surplus labor in a shorter time and thereby also his edvanced capital. The weer and tear of the machine has to be considerod from two anglos..... Uso and Non-use. Look et @ niekel that is Tong in circulation and ecmparo the book that has never been used. The elements of dscay diminish the valy The machine undorgocs a moral depreciation ge valué, bocauso machines of ti and better machines onter the cor It leses ox~ @ produced tition process. both casos, tho valuc of the machine ig not any more deter- ed by its actual production cost, but by the production cost the new and better machinc. Becausc only sccielly necessary labor in the average is the measuremcnt of value. [i Ssttent. In this case the machine has lest value. Tho less time the machine takos to repreduce its total value the less is the danger of moral depreciation; the longer the wer day, the sherter is this period. Whon machinery was first introduced, new it more cheaply followed one methods of reproducing or another. ~41-In the early days of capitolism, therefore, the prolongation of the werking day wes mestiy tried. On e higher developed stage, are te the over-accumulasion of ‘capital and due to the limits of capitalist tochnique, and also to the limits of technique as ! gueh, tho value of the machine is more static. Given the length of the working day, #11 other circumstange! o> Raining the same, the exploitation of double the numbot of work- {ng men demands,'nct only double s part of constant capital ing oer a in machinery and buildings, but also of that part which investenced in rew material. The longthoning of the working aay, is eiventnor hand, allows a production on an extended soale with Gat any alteration in the ancunt of capital edvanced in machinery and buildings. Woohinery produces reletive surplus value, not only by directly depreciating the valuc of labor power and by indircetly cheapen- ing the samo through cheapening the commodities, put also when itis first intreducod in the production process. i During this transition period, when the use of the machines’. is During vi eonepoly, the profite are. oxceptional end the capitel- af ities bo hold om to this situation es long as possible by Jongthening the working day. Profit whets his appetite for more profit. sg tho use of machinery becomos more general in’a parti cular {naustry, tho social velue of the preduot sinks to its indivi- dual value. Surplus yelue arises from the variable capital alone. (Ques- tion). The amount of durplus value depends on two fectors: fexcetion) fe rato cf surplus value and the number, of workers empl oyod. Given the length of the working day, the rate of surplus Salus ig dotorminod by the rolative duration of the necessary labor and of the surplus labor during @ day- The numbor of laborers employod depends upon the ratic of the variable to the constant capital. With the devolopmont of machinery, the number of working men Suployed by © given capital decreased, What was formerly var- fable capital invested in laborpower is now invested in meohinery and becomes constant ‘capital, which does net croate surplus value but only transfers its value to the new product + De mon do not bring as much surplus value as % mone The application of gachinory brings with it a eontradietionsWith a given emow not be increased of capital tue rate of surplus value can ithout decreasing the number of working men. If a man has $500, and he employs 50 laberers at 5, then he in- vested $250 variable cazital and ¥250 constant capital. If he uses a new machine for which he invested 400 constant capital then he can only y 20 laborers instead of 50, or a variable of §100. But tho mass of surplus value was, as we saw first, dependent on the amount of laborers. So it'’should decrease, but it does not because the machine makes more products and by thet lowers ‘the nocessary labor-time and, at tho same time, increases the rate of surplus value, or the lengthening of the working day; that is, social working day. This contradiction forces the capitalist to lengthen the work- ing day absolute or relative--in order that hc may compensate the decrcase in the relative number of laborors oxploitod--by an increase not only of the relative but also of the absolute surplus labor. By this samo process the surplus population develops which has to submit to the dictation of capital. In ma¢hino production the capitalist also intensifies labor. 48 soon ss the lengthoning of tho working day (absolute) was stop 0d by laws the capitalist threw himgolf into the produc- tion of relative surplus value, by hastening thc further improvo~ ment of machinery, from speod-up by foree, to the ?aylor System. The replacement of human labor-power by machinery drove the workors in the early period of capitalism to fight the machine. tors were killod in order tc kill the application of their tion. The Luddite movement in the Hen Century destroyed the machine as the menacing monster. The German weavers did likowise. The instruments of labor, in the form of a machine, become competitors to the worker himsclf. The sclf-expansstn. of capital by mean ly progorticnal te tho number of thé 4 oxistonce is béd s of machinery is dircet- king pecplc, Sew tretr dostroyed by this process. sea The wholc aystom of capitalist production is based on the fact that the working mon sell thoir labor-powor as a commodity. Divisien of labor specializes this labvor-power, vy reducing its skill in handling a particular tool. 4s scon as the handling of this tool boeomos tho work of tho machine, then with tho use value, the exchange value cf the worker vanishos. ~43-These workers swamp the labor market and bring down the price cf lebor-power. The capitalists say tais is not true. And the thoory of compon? on comes into ooing. Ret us examine this theory. Capitalist idoas and thoorics agree thet machinery displices workers but at tho samo time sets free an amount of capital to omploy an equal number of workers. Suppose a capitalist employs 100 workers at $300 a yoar. e has a variable capital for the year of 100 X 300 - $30,000 © of S. 1007). Now he buys now machinery that costs him $15,000+ He only employs 50 workers now or $15,000 variable capital ‘por year. The raw material, ote. before and after: $30,000 remain the samc. Is there capital sot froe? No. There was $60,000 espital, $30,000 constant plus {39,000 var~ jable.° It has now changed to $46,000 constant and $15,000 variablo. Yet it still is only $60,000 together. With each improvomont in the machine fower workors will be employed, if ether circumstances romain the samo. But the capitalists havo to omploy more mohinists in order to make the mchines. If tho mchire is manufactured, it lests gous time, 30 in order te employ tho nechinists ali factorios have to introduec tho machino. (Thé capitalists argue this). But what the capitalists mean by "Compensation" is something olse. They have in mind the means of subsistence of those workers dis- placed by machinery. As a mattor of fact, when tho capitalist gots rid of 60 workers, as in cur oxample, these workers do not consume any more to tho value of 815,000. That moans, a change takes place with the $15,c00. It'is nct any more consumed by the workers but be~ ccemes capitel for the employment of workers. (Fixed capital). This theory says that the 315,000 wore capital, It now fol] cut of production but it will’look for new application in order te bring profit. But for the workers this $15,000 never was capital, but tho moans of subsistence. What confronts them ss capital is $15,000 afterwards laid out in machinery. In rogara to the $15,000 of which formerly tho wo bvuycrs of commodities, thoy are not buyers any mor cf the commodity will drop rs wero the price nore workers will be’ discharged. nA beThe setting froe of wcrkers in cno brench ef industry does not Qompensate. in the ompleyment of othor branches, but sete workers in other branches free toc. The labcrers who are taromm out of work in any trench of in- dustry cannot sock employment in soe other industry. They. find 4t only whon a new capitalist is out for new investments. As scon as machinery sets free a part of the workingmen employed ina given branch cf industry, the resorve men are also divert- cd ingo new channels of employment and become absorbed in other branches; meanwhilo, the original viotims during the period of transition are left’ to charity and seml-starvation. Mechinery as such is not responsible fer disconnecting the werkers from the means of subsistence. Machinery as such considered alene, shortens the hours of 1a bor. Sut in-the use of the capitalist machinery lengthens the hours of leber. In itself it makes the werk easier, in capitalism it mekes the Work more intensive. Machinery of itself is a victory of man tver nature but in she hands of ths capitelist it makes man its slave. In itself machinery increases wealth, in capitalism it makes paupers. Although machinery necessarily throws men and women out of work in those industrios into wnich it is introduced, yet it may des- vite this, oring about en increase of employment in cther indus- tries. This effect however, has nothing in common with the so-called theory of compensation. We will see later hew this works. So far, we can say: The new later spent on the instruments of labor, on the mach~ inery, must be less than the labor-power displaced by the use of th$ machinery, ctherwise the product of the machino would be dearer than the product of mamal laber. And the cheapen- ing of the commodities was tho reascn for the caployment of the machine. In proportion es machinery increases so docs the mass of raw material. The instruments of laber split into numberloss branches. Scoial production increases in diversity. Tt rease cf the means of production and the subsistence (by tho growing luxuries cf the ever richer capitalists) accompanied by a relative diminugticn in the number of ~45-ed deucna for laborers in making canals, bridges, etc., worszrs that can only bear fruit in the future. Entirely new branches of production, creating new fields of labor, are also farmed as the direct result of either machinery or thé general inaustriel changes brought about. eauses an incr The porticn of producing workers becomes smaller and smaller, while the parasites are absolutely increasing. The cheapening cf the articles produced and the improved means cf transportation furnish the weapon for ccnquering new markets. At the same time the encrmous power inherent in the factory system, which expands by leaps and bounds, as well as the de~ pendence of that system on the markets of the world, necessarily beget feverish production, over-filling of the markets, ocntra- dictions on the market, crippling of production, crises. Except in the period cf prosperity there rages between the cap- italists the mcst furious combat for their share in the market. s share is directly proportional to the cheapness of the pro~ duct. In the sphere of agriculture, modern industry has a mcre revolu- ticnery effect, because it does avay with the bulwark cf the old society, the farmer; the peasant replaces him a3 a wage laborer. But all progress in capitalist agriculture is a twofold progress. The robbing of the laborer, that is exploitation, and the robbing cf the soil at the sametime. Reading assignment: pages 557-617. Speakers’ " 1) The development of machiner, 2) The e2 the machine on wor 3) The theory of compensation.; Feading assignment: 8 557-617 Birst Speak The Development of Machinery Second * The Effect of the Machine on the workor Third" 6 Theory of Compensation 4 cake necessary corrections) The Production of Absolute and of Telative Surplus Value. pitalist producti modities, it is ess on is not merely the production of com- ntially the production of surplus value laborer does not produce for himself, but for the capital- eduction of absolute sur capitalist system. It is production of relative surplus v there in order te make the 1a’ is the principal aim star int for the value. he former must be tho nocossary labor is Gquitalont for the wagos i produc upon the len. surplus valug revolutionizes and the composition of soci nds exclusively roduction of relative rocesses of labor A distinetion b cars illusory, yt the diffe: makes itself: Zolt te cf surplus val plus valuo t other and ive surplus valuo \ a @ raising the n labor is paid at its value; that ven productivity of intcnsi ity rate of surplus valu “actual proten labor-power, rand its normal only be raised by eecssary and plus value is of labor. length of the working cd roums tanecs ~4a7-sane, and given the length of the working day, labor will vary with the physical oon- with the fertility of the soil, ete. remai: vag’ th the quan dition of the fitted for the development of capitalist production. whore nature spreads its fruit toc freely, there is no nocessity | But this docs not moan that the most fruitful soil ia the most | for dcvelopment. I It is not the mere fertility of tho soil, but the difforontie- tion of thc scil, the variety of its natural process, tho chanzes of the scasons, which form tho physical basis for the | social division of labor and by that lod to capitalist produc- | tion. Favorable natural conditions alone give us only the possibility, nover the rcality, of surplus labor and of profit. The necessary laber-time is differcnt under differont oirouh- stances. £ labor-power and Jation to But lot us sce in which dircetion the price surplus value could vary. Changes arc possible in r the absolute and relative surplus value. The value of labor-power is doterminod by (Question) the value of the neecssitics of life habitually requircd by the average worker. mat a Tho quantity of those nocessitios is ix of a given society. y given opoch ¢ it aa & constant magnitude; what changes nbity. is sold at its tude of sur- ys assumed that covery ¢on + Under such conditions the relative valuc and the pride of labor-pow three circumstances: 1) The length of the 2) Tho intensity o 3) The productiv itudes: Ict us look at different offects of a Assume that the length of the working o intensity of labor is nt, while tho productivity of labor varics. What will h {1 and 2 constant, 3 variabls). 4A working day of a th alseys orcates the samo amount of valuc, no mattcr how the productivity of labor, the mass of tho product and t of cach si commodityproduced way vary. If the valuo oveuted by a working day of 12 hours would ve #6 then, althcuyh the mass of the article produced vary with the productivity of labor, the only result would be (Question) that the value represented by $6 is spread over 8 greater num- ver cf articles. : Surplus value and the value of lator-power vary in opposite directions; If the value created by a working day of 12 hours is co then, the one part of the value (surplus value) can only erease if the other (labor-power) increases, or the opp $3 surplus value plus §3 labor-power, thon the valuc cf labor- power cannot rise from $3 to $4, without the surplus valus falling from $3 to $2. The valuc of labor-powcr cannot fall, snd oonsoguontly surplus value cannot without e rise in’the productivity of labor. An increase in the productivity of Jaber causes & in the veluc of labor-power and conscqusntly causes a ris the surplus value; While on the othor hand, a docroasc in such pro~ ivity ca 4@ ris¢ in the value of 1: and a fall proportional inercasc or diminugtion in surplus valuc, change in the productivity of labor, consequently is on ths Criginal magnitude of that porticn of the work- day which ombedios itsclf in surplus valuc; the smallor that portica, the groater is the proportional chango; the greater that portion, the less is thc proportional change. while in cur cas $3, by 1/4 or 265) i/2 or ‘i the valuo of labor-power fallg from,$4 to tho surplus valuc risos from 72 to $3 or sary labor-tinc $4; surplus 1socr-time 32). o The valuo of iabe: quantity ef nce rainca by @ givon It _is tno valuc and not the mass cf those ncoessities thet Varios with the productivity of Tabor. Ricardo was the first who formulatcd thcso laws, but he had net investigatcd surplus valuo as such; that is, indopondently of its particular form, as profit, rent, ote. For him the rate of profit and the rate of surplus value wero tho same. Tho rate cf prefit is the ratio surplus valuc to the total capital advanced; the rat rplug valuo is theratio of the surplus value to the variable capital. A capital (0) of $500 The constant part $400, tho variable part $100 tho surplus value $10C. Thon the rate of surplus value is s: $100: 100% vi $100 But the rate of profit is With a given rate of surplug value, we can have difforent ratos cf profit. Ricardo mixed up the profit with tho surplus valuc. Ho was only interested to find the magnitude ot profit to the produc- tivity of labor, but then he never analyzed surplus value as such. We can censidcr this subject from another anglo. Assume that the working day is constent and the productivity of labor is constant. In this case it is the intensity of labor which variss. What ao wo aco now? Increased productivity of laver will also supply more preducts. But in this case the value of cach singlo product falls; it costs less labor than before. By mercly intensifying the production, tho valuc romains un- enengod, for cach article ecats the samc labor as bofore. We heve only an inoreass in tho numbor of p: their number incroasts so docs the sum of th oducts, and as sir prices. ut by increascd over a greater mass of products. If the intensity of equally in overy branch of industry, i r dogree would become the norm! degre fore cease te be taken into aco unt. But it would still] make a differerce in relaticn to other countrics. Moro monoy would ve made, because the intensity brings more capitalist, wodlth to th ing the valuc of the m0! The of money ti nation would bo _ropre~ would be the lossintense of ancthor nation. let us investigate waat wuld take placo if the productivity and the intensity of labor would be constant but the length of the working day would very. A shortening of tuc working day loaves the value of labor-paver, the neceasary labor-timc, unaltercd. It reduces the surplus labor and surplus value. Qnly by loworing the price of labor below its value could the capitalist save his surplus value. ay lengthening the working dey, the price of labor-powor may remein the amo, yet it would have dropped rejativoly. i WAGES il On the surface of bourgeoia socicty the wages of the workers appear as the yrice of labor. 4 certain quantity of monoy is paid for a cortain quantity of labor. rkor sells his lebor-powor as a commodity on the mar- the beur- nt when demand and supply are in cquilibrium, i$ ite natural price, dotemmined infepondently of the relation cf supply and domand. Supply and demand oupleins the price on the marist above or below its real ccat. As socn as supply and domnd balance, explain the price. kmow whet determines the value en of labor~ Ore i arns $3 a day ho © ar to him ag his che e o 2 tH Bo 6 orm doos. away » v Sesdry and ‘aurplus Lebior=timo + capitalist poys him $3 for nour. But in roelity he pay the worker ercated u vaius ofIn slate iaber, eli labor, aver in which tho sieve is only replaci means cf cxistence, 2.pears te hin part of the working day the value of its own ss laber for his master. In the system, even unpaid le or, eppears as paid. Thore are many forms of wages, but two arc fundamental: time and piece wages. The unit moesure for timo wages, the price of the working hour, is the value of @ day's labor-power divided by the number of hours of the average working day. If the capitalist would employ a laboror 6 hours instead of 12, only 6 hours would represent the worker's wagos for a half day; that is, he would pay the worker half of his wages. The longor the working day in any branch of industry, tho lewer arc the wagos. The price of lebor being givon, the daily / cr wookly wage deponds upon tho quantity of¢labor=poyer ox- ponded. The lower the price of labor-powsr, the greater must be tho quantity cf labor, or the longer must be the working day for the laborer to secure oven a miserable average wage. Tho lewored price of labor acts here as a stimulus to the exton- on of the labor-time. Picce Wages 1 jagce by the picce are nothing other than a converted form of wages by time just as wages by time arc a converted form of the us cf labor-power. f If a worker in tho averags can produce in 1 hour 12 pieces of a certain articlo and ho is peid 60¢ the hour, ho gots paid for 1 picoo 5¢. The capitalist may pay him by the pieco, sey 4 i/2g and intensifies the worker's labor by sc doing. At the samo timo, net to watch the worker so carofully, for orker Will labor the much harder to make cnough to get is price. ified form of timc wages. wages is that form cf wages which is mcst in harmony n the capitalist mode cf production. ing Assignment: Pages 616-670 Speakers' Assignment: 1) The production of absolute and i iva surplus value.SSICN ELSVIN Roading Assignmcnt; Pagos 618-670 First Speakor: Tho Production of relative and absolute surplus value. Second Speaker: Time Wages. Third Speaker Piece Wages. (Make necessary corrections} Tho Accumlation of Capit. The conversion of money into means of prcduction and labor- pewer is the first stop in the differcnt functions of capital. This tekes place cn the mrket, within tle sphere cf circula- tion. The second step is the production of commodities whieh ecntain the advanced original capital, plus a surplus valuc. Those commodities must be thrown into circulation. Their value must bo realized in money. This moncy must be converted into capital, ote. Such movement forms ths ciroula- tion cf capital, So tha first condition of accumulation is that the capitalist gots rid of his commoditics, rocsives more money than he at iirst invested and then continues production more capital. In the intercgt of a bottcr understanding of the process of accumulation we assune that the process of circulation is “normal”, th: ans the capitalist gots always rid of his commodities, this is assurance that thoro is no distur- bance in ths sphere of circulation. Quostion: Is this sc in roality? Noe In volume 2 Karx deals with oll the different possibili- ties in the sphorc of circulation. Sut to find out wacther tt aro to be found in t real diffioultics of capitaliam 5 sphere of circulation wo dismiss theoretically this difficulty. Wc want to f4 cthor * cspital could harmoniously sav if tae eir- culation would nct oxist. Later on, ve take up el] questions conecrning circulation. During this snclysis wo im that the ciroulat is "normai" and that, outsidc of the proletariat there are only capitalists in tho world. tion: Is this so? No, it is not. Even if the capitalists 53+at’ wo aro trying to find he surfaco we cannot see in op ortance. 30 wo abstract and try to take up capital ich is these on in ultimate owner er capitalists, nevortholess differen- 38 essen- af ‘al icrm, not disturbed by sidc-tracking influences but “nor- 3 pleco, moditics,ons, sc mush be reproduction. ve 20 surplus value in a pro- cess of production, get again $20 surplus relue ne nag to invest yloo again. ist dows this over amd over 4g us, this surplus is te him 4 ain, getting all the steady rovenue. ae If he consumes the $20 cach time, then wo have what Merz calls simple reproduction. Tae purcheso of labor-powor for a fixed period is the prolude to the procoss of production. Bat tho laborer is not aid until after he has expendod his labor-power, and realized in ¢onmodities not only its value but surplus value. producca surplus valuo i also the fund out of which ho him- capital. His employment lasts only reproduce fund. has not only p: ets back in sagos is 2 partion of the product transaction is veiled by tho commodity-form o2 This simp the 4 the money-forn commodity. he Workers cannot buy itelists ere not in- but just tho oppesite. aapitalis ne production of con- sumption gcods for th , a3 an individual, inte: ted in h: own workers) in order tc A capitalist whe caly solis diamonds | is interested in vory low x spond more le, theso dif-worlcr sota, the more nterosted only in his m no market, but poople Th the own shar ormers reprose for whom ho fuels sorry und Capitalism is only intercsted in surplus valuc. Surplus lab- er can cnly bo giinod by shortenins nocessary labor-tine or longthening the surplus lubor-timo. Both ways have one effect on t riors-- cutting from their own shero of the greduct they producc. The worker movor gots zere then he necds for his repreduction, so the capitalist class as a veannot think to ict nim buy back more particular historic providing the nccossities of life its form changes. Nor if th Besant 16 cag ant land from the yr the lord, th throes 42 627) "The m is and must roduction of capits: nd fhe capitalist, on the t would start cut 7 4200 surplus @ every 1a bo 5 timss $200 or 000, advanood by the eapital apital of $1000 ‘plus value would surplus 7 equal with tho capit Tf only. a end of 10 5. of ~1000.Production would neve come to sa ond. ¢ the machinery, the ys. But wo are deal- no more valuc, it f course the capi 1000 actual ing with valuc would be out of date. dhen @ person “gots tiough" with ali of his property, by t ing upon himsolf debts cqual to the value of that proporty, ts bat the § it is oloar that ais property roprese total of his debts. Thorefore, simplo roproduction sooner or converts cvory capitalist inte en individual who accumlates capital; it converts every capital into eacoun ) or oaD= italizcd surplus valuo. Conversion of surplus value into capital. Up to this point wo have plus value. Now wo will found cut how oapits Boe 5 how surplus yaluc beconcs capital. it into cap- Bmploying surplus valuo ital, is called Accumul ati Mat is accumulation? Let tno standpoint of an individual capitalis Production: 240,00 of 312,000. The t in $10,000. ds of cotton. coats 32000. 1 ai 4 t a part of th groduction and abovs ¢ capital the surIg the exploitation of the existing workers does act increase, then, additional lavor power must be Zound. \ The mechanism of capitalist production needs not only a class de- pendent on wages but also for its increase. It is only necessary for capital to incorporate this additional jebtor with the surplus moans of production and the conversion of gurplus value into capital, and tho accumulation is complete. Accumulation resolves itself into the reproduction of capital on 2 progressively inercasing scale. Tne cirele in which simple reproduction moves alters its form, it changes into a spiral. Lf we forgot for a moment that the capitalist eats, and this fect doca not change our system in any way, thon we see that if a surplus of $2000 wore capitalised and brought $400, this $400 i capitalized would bring $80, and so on. The original capital wo started out with was $10,000. How aid the capitalist got tais $10,000? "By his own and the labor of his fo: say. This is nct 30. Can he sey the samo ab $2000 -- $400 -- $60, and so on? No. In both not say 30. Later, by primitive ted; he athers” w ut the add tances he could cumulation, we will seo how the capitalist rx put it'“is like the conqueror whe buys the money he has robbed them". But by tho additions ap of unpaid lab elearly see that it is made work2ra eir products. This is what is called "oreatin 2 out of capital" accaFirst we ascuned taat the capitalist (simple repreduction) gcngumes all the surolus vaite himself. Then we said that the capitalist docs not consume at 211 but, instead, capitalized the wacle of the sur value. Both things, howorer, do not take place. The capitalist is deing both things at tho same time. He eats from the surplus and he capitalizes a part of the surplus value. In order to vat more than before he ac- cumulated the surplus value. Therefore, with a given mass of surplus value, the larger ono of these parts, the smaller the other. I? th oapltslist cate much, he can eccumulate loss and vise vorsa. The part of the surplus value that he does not eat aved" by him. Marx: " Fanatically bont on making value expand itself, he ruth- asly forces tae human race to produce for production's sake. thus forces the dcvelopmont of the productive forces of s eiety and creates ge a ee ee et ee ae the real basis for = higher form of society, 4 society in which the fall and free development of overy individual forms the ruling principle.” The development of capitalist production mkea it constantly necessary to keep ineroasing the amount cf the capital laid out in a given industrial undertaking, and competiticn makes the eminent laws of capitalist production to be felt by each in- dividual capitalist 28 extornal lews. It compels him to keep ecnatantly extending nis capital in order to preserve it, but the only way of extension is by means of progressive accumulation. The proportion in which surplus value breaks up into capital nd revenue, the magnitude of the accumulated casital depends glearly on the absolute magnitude of the surplus value. nat 80% wore capitalized a: 11 be $2400 by a total sur: surplus of 1500. 207% eaten up, the accumulated plus of 3000, and 1200 with ce the cost of surplus value constant vendency of of back tewards zero. (Rone: leitation)}. ulation of Jaber, the degree With the productive power © hich & certain valu provuéts inerezsos of aBut hand in hand with the increasing productivity of lebor gces the cheapening of the labor and by that a higher rate of sur- plus value. Then the same value in variable capital sets in motion more labor-power. The same value in constant capital is then embodied in more means of production, in mere instruments of labor, ete. It therefore supplies more elements for the pro- duction of both use value and value. In this oase then, the value of the additional capitel remaining the seme or even decreasing, accelereted accumulation still takes place. Net only does the scale of reproduction materially ex- fand, but the producticn of surplus value increases more rapidly than'the value of the additional capital. Generally it can be said that "with 2 given degree of exploita- tion of labor-power, the mass of the surplus value produced ig determined by thé number of workers simultaneously exploited; and this corresponds, altzough in varying proportions, with the magnitude of the capital. Therefore, the mere capital increases by means of successive accumulation, the more does the sum of value increage that is divided inte’ consumption fund and fund. The i therefore live a mc ly life and at the seme re abstin he springs of production act with g: its scale extents with the mass of ths of zelua it is ded inte cons cduetion snd variable process of produc duction andetermincd by its tectnical composition and mirrors the changes of the latter, the organic composition of capital. The many individual capitels invested in a partioular branch of production havo, one with the other, more or less different compositions. The average of their individual composition gives us the cozposition of the total capital in this branch of industry. Lastly, the average of these averages in all branches of production, gives us the composition of the total social capital of s country and with this alone we are now k goncerned. Growth of capital involves growth of its variable constituents. A pert of the surplus value tuvned into additional capital mst i ways be retransformed i ble tala | If the composition of cepital remains the same, that means that i a definite mass of means of production constantly needs the same mass of labor-power to set in motion, then the demand for labor increases in the same proportion as capital. And the more rap- idly, the quicker ths capital increases. With the opening of now markets, (Marx oslls this special Seimlus 0 enrfomont)or new epheres fer tho cutlay of capital, newly daveloped social wants, capita? on a progres- \ sive scale, means alao more or larger capitalists on one side, moro wage Workers on the other. Accumulation of capital is therefore an inorease of the pro~ te Roading assignment: Pages 671-783 Speakers! assignments: 1) Simple reproauct 2) Conversicn value into cap 3) Productivity of laber and accumulat. ~61-SESSION TWELVE Reading Assignment Pages 671-763 lst Sp Simple R end Qonversi Sra Speaker: Produe eproducticn of aurplus value ints capital. ty of labor and accumulation. Refer to the study cf Sesgion Ten. ae sugply. Then in the price o capitel, only means ia fa the golden chai self allews a relaxation But this docs not clter nich it m isalist productionIt cannot be othermise. don men is governed by the products of his vain, 90 talist production he is governed by the products of his om hend. | According to Marx the dovelopment o the motor of the historical devel opre With the new productive rovers the ; preduction and with it way and mo ing. Gazdtelisn, more than ang other mode of (on account of the value relation) deve: power. This is why capitalisc was nece ard in the omaneipation of the human fast step The development of the productive power is reflocted in the technical composition cf capital, or in the growth of the means of production. This again 1s reflected in the value composition by the increase of constant cepital at the ex- pense of the variable. he inoreasin. of ti the value ore rises capital ~ Value Tho mags is 10 tines developed, The increase in t capital is therefor m the mass iable cs z 2 oreases with the(Blackboart) 6000 Constant Capital 50 ~~ Variable Capital 50 3000 3000 18000 Constant Gapital 60 -- Variable Capital 20 14400 3600 To increase 3000 to 3600 variable, it was necessary to raise the original capital under this new organic composition 3 times. 4 20% increase of the variable capital makes a 300% increase of the total necessary. he development of the productive power is necessary. Marz, B. 685; "With the accumulation o ital, tho specific mode of production developes and with the capitelist mode of production accumulation of capital. Both thesceconomic fac- tors bring about thet change in the technical composition of capitel by which the variable constituent becomes always smaller a5 compared with the constant." Every accumulation vecemes the means cf now accumulation. With the accwmlation capital so the number of capital ists inerease. With the increasing mass of wealth which functions as cap- ital, accunulation increasos the concentration of this wealth in the hands of individual capitalists, and so widens the basis of production on a large sale. The growth of capital is effected ty the zrowth of many in@ividue] capitalists. etition is fought by oheapening of oom- depends on the pr vity_f on the sacle of preducticn. So the beat the smalier one. italist can opens now talists. Sc oon ana cent: né@ in hand; same time defeat the Centralization in a certain line of industry woulda have reached its extreme limits if all the individual capitals in- vested in it would have been analzazated inte one sinzle cagitel. (Paze 682). Contralisation supplements the work of lation byitalists to expand the sacle of The economic ism ys ths samo, even in State ¢ angifies the’ accumulation. ne technol pesiticn takes variable capita: ich mirrors tho orzaniz.¢ as constant ani If it wes ori, it will become: 8-1, ete re than 1/2 but ower; and 2/; By this 2 surplus laber population is a necsssery uot of capitalist accwulrtion. It is the law cf population the casitslist mode of ¢ {an abstract ution exists for plants 2 only, and not interfere’ w: ty masa muman taterial al w: D eyelicel character of production depends algo on the existence of an 1 reserve arny ohildhoed of canitaliam gomposition of capital ged slowly, and as 4 result there wes @ steadily gr demand for laborers. Thi nereases with acoumulation and hi rel ion Read Marx, »: concern us here.” “Phe lateseeee es 764 to the ond. } Crganie Compo ) } The Industrial Accumulation. can edaSESSION THIRTEEN CONCLUDING SESSION Reading Acsignnent; Pages 784 to the end. Speakers! Assignments; 18t, Organic Composition of Capital. 2nd, The Industrial Reserve Army. 3rd, Accumulation. RECAPULATE Technical Composition; Value Composition; Organic Composition. Wo have dealt with "Scoial Capital" - one capitalist, with only Igbor at the othor pole. Development of the organic composition ion ig first a natural pro- ceas of the development of tho produc ve powers of soe It has a val ¢ character in capitcliam and this is the reason why it develops so feat. ard to the necessities of mankind mt z surplus value; in When it comes in conflict with this historical Zorm (capital- igm,-- value the mode cf pr then a new scelety must productive pow With the workers goes of workers is luce to the Stion ere The reserve aray is necessary, ready for the creation of now's socond, te check the wages cf t The theory of supply dustrial reserve aruy Explain the 1 wages rise and don cf the wage mov w far can they risc, at brings thendown again? With the develozamt of the crganie ecmposition dhe mass of the means of production snd the products ere increasing, but its values is decreasing at the same time. ass 10 Machines (Blackboard) Constant Capitel: Value * # " ess 100 Machines Here the mass has 10 times developed but the value only 5 times. This goes for commodities, labor-power, ote. By this, the increase in the difference between constant and variable tal is lese than the difference between tho means of production and labor~powor. (Blackboard) Capital: 6000 Constant: 3000 .... Variable: 3000 (508) Gepitel: 16000 Cons ° se 3000 to 3600 v2 #000 to 18000 tot capitel makes en 60% inerease in the 200% in total capital. was necessary to accumu~ rease in the stant nec- &66606 able capital in relation to tz a@ resnit unemployment.1d meen in relation to on of capital: of surplus vel it: le, rate of s.v. 100% nate gt sae 109%, : 8 to the end cf capitalism if not ass of profits would increase. Value 500: Value 2500 : Q congtant, coe 4 58 ver}e Lin the r. of p. would jmultanecusly wita it, t (Back to pago 88, bls cause re the rate of he fall in Let accumula ti acoumulation 1 ye 200 000-v R of 8.7. 2° 220 000-0 sre zon uw oH ee0eeen0lating under a rate of exploitation of 100%. 3c and Z20C; rate of surplus would heve hasten- ed the on process, that meang wore constant capital (te maxe this 3 oxplcitation possible) but even under our circumstances the rate of profit hag dropped in spite of in ereasing the masa cf profit. , Volume 3; “The fall in the rate of profit shows the re- ive fail te the surplus value of the advanced capital.” he rate of profit is an index that shows the in the mass of profit. 1 SURPLUS VALUE 1937 ee | q ac IM SC CAPITAL 7 Ss 1937 | | arc Kiev | ce i 1 Seemus vag 1408 CAPITAL apital hag grown from 1900 to 1938. (See belows) So hes the o: ganic composition; but because the crganic composi- tion develops, an always bigger part of the s.v. must go into accumulation cf constant aapital. Tho amount which is left for the capitaligt and worker becenes smller. means, the surplus oan grow absclutely and s does net to feed tho capitalist and the worker. Every surplus ig needed for the accumulation, and if there is no acoumu- lation there is a crisis. You may ask, Why doesn't the capitalist stop this process? The mass that is necessary fer the oonti: lation progcss is not depondent on the ret the mass of the existing total cayital. The goes on With the powor it already possesses, not in to the rate of profit. a faster scoumulation is the sate process; both « duetive power. Even if s cagitelist concern rot WAeC = Accumulated Conatant AeV = * Variable C-C - Capitalists’ Consumption Fundwid bs foreed (by yompetition) to renew its appeer- ance not in relation te the 50% used but in relation te the 100% of the oxisting fixed capital. But let us lock at a process cf accumulation through orisis and prosserity and find the general tendency working there. Marx, Volume 3, P. 303. "Zhe devolcpmont in the productive power of labor creates in the falling rate of prefit a law which turns into an antagonism of this ucde of production at 4 certain point and requires for ita defect periodical crisis." General tendency of capitalist accumulation: Wealth on the one hand and pauperizetion on the other With the acounulation of capital the acoumulation of poverty goes parallel. ‘This absclute law is ucdifica by differont Girounstanoes,not ehanged-- only modificd. This law is, as the inner law, working through 17 modifications. Accumlation, no mitter how it may beasne sodified, hus as the last result misery for the workers to thc samo extent as wealth ig produced. Accumulation can only go on se long as ther nde and sc long a3 there is srofit oapitel w late. A crisis could only be explained i some reascn cepital eannot meke any more pr “p . e crisia scts ais depression wuld ome.But lubcr is tho only souree to capitalize capital. But re- letively there is, a8 accumul:tion recs on, always less and Jess labor: the rate cf profit drops 211 the tine, but at periods the mass of profit gains. Aa long as this goes on, eepitalism is on en upward trend in spite of the drop in the rete of profit. But then, as we saw, the mags also falls, or is not sufficient encugn to bring tho organie composition hizher, then the accumulation stops. The crisis is there. And that would mean the end of capitalism, because it is the ond of profit-making. The class struggle sharrens, the cisery becomes go zroat that the revolution takes place. co orisis sets in at the peak of accumlation. It there before. was not So we call it Over-acoumiation. Money from the already existing capital is still ocming in, but nobedy wants it because it would not bring profit; so it swanpe ar-production of capital. dAccumlation steps. All tho industries, wiich were engazed in producing for acouu~ lation on the given accumlaticn rate get rid of their workers. Gazitalists ao not buy any csterial for the industries, so the preduction in these industries stops; production of ocrs umption z00s ceases because the feedin; of laborers becomes unnecessary. The capitalists are zoing cut of tusiness but every indiviawl capitalist tries to save himself. He can only do so in the slo of competition. This means he hes to bring up his roduetive power in der + er than the other capitalist. He applies now 8 production (hizher nia composition ) by which he can sell over his indi vidual ue but hnder tho socizl value. He gains an extra profit and more capital, but whieh gradually are nullified; for as soon ag he dces $0, other talists apply the same methods reduelly become the social methods and the value the social value, The capitalist in the samc time always tries to Ec because his profit is determined by the gapital he possoases. one c2pitalist makes in a certain production sphere an extra prefit, nore capital flows into this sphere, and goon the rato cf profit is the same as the social rote. But then profit is detormined by the cap- ital that the eapitelist possesses. RE Tho hizner organic composi order to live. So in tryi! making profit, they develo higher scale. tion is &@ necessity for capital in ng to cverecne the impossibility of p this inpossibility only on 4 In order to overcome the crisis 72) the impossibility of util brings us to the cyclical charceCounter tendencies: gher vate of profit througu the development of the produc- tive power. Rationalization. Concentration 4 Factories: Concentration of 4 to 3 factories with the same production There will be unomployment, but for sometime more profit. iffcation, more commodities in loss 72 More sxploitation, inttim, the noccssary labor-time. wetening Shortening cf the time of turnover: better circulation pro- cess. With this, more money on the market. The rate of profit is now dotcrmined by 2 smaller total capital. New sphere of production. Doing away with ground rent. Doing away with the merchent profit. Killing of the profit-ceting midile strata. Devaluation. (Cepitel becomes valueless due to the develop ment of productive power). War - bankrupte y+ World market. Export of capital. Exploitation abroad. Cheap raw material - Imperialism. Monopoly. Desbh crisis if 211 those counter tendencies are not strong enough tc compensate the general tendency that loads to the vroakd own. But before this the revolution will take pleco. The erisis due to the over-accumulation of capital is also always a crisis of over-production cf commodities. 1) Bris itive Accumulation accumulation presu as a circle. poses surplus value; the whole move~ M-C-M- C-li Where was the beginning? Money and commodities are no more capital than the means of production and means of subsistonce. They were transformed into Gapital, (Use and Exchange Value). @kero is no capital without freo labor; this means people who have nothing to sell but their lubor-powor. The capitalist syatem presupposes the complete separation of the laborers from all proporty in tho means of preduation « ~73-con ug capitalist production is working it reproduces this socic] reletion. The primitive accumlation is nothing else than the historical precess of divorcing the producers from their means of living; that is, the means of production. Ib appears as primitive, because it forms the pre-historic atage of capital. The economic strwtire nas grown cut of feudalism. The dissolution cf foddelism sets free the clenents fof the development of the capitalist node of production. Free labor could only be there when the laborer wae not any- mora bound to tho soil. Tho guilds had to be dissolved to overcome their labor regula- tions. On the one side the emancipation from serfdom and guilds, on the other the new form cf exploitation, wage work. But this ig at tne same time the development cf the productive power of sccisty. The bourgeois revolution of the 16, 17, and 18 centuries: the expropriation of the agricultural producers, of the peasants fron tho soil, is the basis of the whole process. The history of this process in different countries varies with Gifferont pericds. But essontially it is always the 8 In England it ‘Llustrations are given by Marx. ad its “clessical" forn. In England sorfao: ctically disappeared in tho last part cf the lath They lord century. A massThe new nobility was @ child of the tim for which money was the power of all powers. Transformation of land into sheepwalks. Merx illustrates the process of driving the people from their land and using the lend for the manufacture cf wool and the free labor for the production of wool commodities. Primitive accumlation: The expropriation of the church propert the robbery of the common land, the usurpation of feudal and clan property, its transfornaticn into modern private proporty under circumstances of reckless terrori They conquered the field for capitalist agriculture and created for the town industries the neceasary supply of "free" laborers The laboreracould not be absorbed as fast as they were thrown on the market. Thoy could not fast enough adept themselves to the new conditions. The result- beggars, robbers, vagabonds. For this reason there was passed bloody legislation in Burppe against all vagabonds. Flogging, branding, killing and hard labor prisons, end various foras’of torture, were in full foroc. Marx gives some laws for the sake of illustration. In he beginning, (not much machinery} variable capital was The domand for wage lebor grow rapidly with + A large part of national produet, e fund alist accumulation, then stil} entered into the consumption fund of the laboror. Then the .+> period of legislation of labor took place. set thebbight of wages, laws against trades unions, 8 dropped only in 1825, etc. We know by now how the proleteriat Was created, but what about Let us begin with the talist farmer. This was a slow preeess going on throughout cen uries. The serfa ag well as free small p under very difforont economic aonditii cprietors hela land nS « In England the first form of the farmer is the bailiff, hin- Self 2 serf. Ho was replaced by the farmer, whose landlord provides him with scod, cattle and iuplinents. He exploits tore laborers. He advances on half of the steck, the landlord on th half. They divide the products. otherThis fora disappesrs ani mexes place to farmer proper, who wakes “Zig own c@pitul breed by employing laborers and pays @ part of the Surplus product to the landlord as rent. With the agricultw revolution, (such as wool manufacturers) he enriches himecl? very fast. With that, he develope in the samo time the industriel capitalists. The sxproprietion ené eviction of 2 part of the agricul tural population not only set free for the industrial capitaliststhe jabererg, thoir means of subsistence, and material tor labor, it also created the homo market. In fect, the events that transformed the small peasants into wage laborers and their means of subsdstence into material clemonts of capital, created at the same time a home market for the capitalists. Formorly the pess2ntsproduced the means of subsistence and the yaw material for tomselves and they consumed them. Now these thingshed become commoditice; the large farmer sells them on the market, he finds this market in manufacturers. Many small guildmastors transformed thonsolves into capitalists, ‘The money capital formed by moans cf commerce was prevented from turning into industrial capitel by tho feudal constitu- tions, (Guild organization). With the breakdown of feudalism this wes done away with. The discovery of gold and silver in Anerica, the beginning of looting of tho Bxét Indies, Africa es the commercial hunting ground for sbaves, eimalized dawn of capitalist produc- tions loree ig the widwife of every ola society prognant with 2 ow ons. It is in itself an econowie power. story of ‘alism fren tae 15th century, the Netherlands, Spain, eto.) oe ae yerx illustrates the brutal process cf the outspreading of upitalism. Rebvery, killing, Java in 1760 equalled 60,000; 1815, 18,000). Thus colonial systons ripened 1 and navigation developed. a hot house Dlant. Trade Today industriel supremacy inp. the period of manufacturo it that tho industr eoloni lies comercial supremacy. In g the comueroial supremacyThe benk tion) mone same time a 2 toc. Bekers loaned (private institu. s“erment. They printed money. In the ational credit system has developed. So capitalism spread. The modern system of taxation was necessary to cover the ex- pense of interest by the government to the banking capitel. Merx: "Capital comes into the world dripping from hoad to Zoot, from every poor, with blood and dirt.” In weatern Europe the process of primitive Accumiletion is al- most completed. ¢ tho capitalist regime has either dirsotly conquerod the whole domain of nationa? production, or, where sccnomia conditions ara lesa devolcped, it at least, indirectly controls those strata of society which, belonging to the an~ tiquated node of production, continue to exist side by side with the gradual acoay. Bat in the colon with the resistence eondition of labor, stead of the capitalis ime comes into collision no a3 the owner cf his to enrich himself, in- 24 Thet brings cbeut = struggle between them. The capitalist tric tation by force if ezploiter if neces nothing else then tition on exploi- the original mization is Exploitation of later in golonizetion, also raw a stcrical Te: brough prisitive accumu: accumulation end f 2th cn one side pov: a is the acounulati tendeney cf accu the bosom of tion fotters then; keeps tion sust be annilated. -77-the oxyropristion cé place. One ca xpropriated. gations. The expro’ 2 mess by a fow. Central- gs many. The oxpro- cnt of productivity. 21 ticn of the few by the mas. on of nogeti SEI IRI feck aod ERRATA Page 68 - second linc from the bottom;continued on page 69- first line from the top shculd read: ( In this oxample,wc maintaincd until the tenth year a rate of surplus value of 100%. Later we adopted a rate of 200% and another of 300%. the inercase in exploitation the growth of the mass of profit compensates for the fall in the rato of profit.But this rate surplus value has to be cd constantly to compensate for the fall in the profit.)Lit ATURE fe recommen . The Bourgeo: e of Bolshevism 10 Cente R. Luxemburg: Leninisn or Marxism jo" R. Luxemburg: Social Reform or Revolution 25 The Permanent Crisis That Communism Really Is? °° What Next For The American ‘Yorkers 5! Horid-Wide Fascism or “orld Revoluhio’ 5 0 Bolshevism or Communism 6 4 he Inevitability of Communism 25" A. 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