- Ready, comrade? This chapter takes us inside the production process to look at what labor is and how capitalists use it to turn a profit.
- Labor is something that exists in all societies, not just under capitalism. Marx defines it as a process between people and nature in which people, through their own actions, change the world around them and are changed by it. They realize their conscious purpose in physical materials. The labor process is made up of purposeful activity (working), the object on which the work is performed, and the instruments or tools of work.
- Nature provides the raw materials, and people make the tools. In fact, tool-making is characteristic of the specifically human labor process. Marx says studying tools of past societies allows us to understand and distinguish between different economic epochs.
- The instruments and the object of labor count as means of production, a concept Marx talks a lot about elsewhere. Products made in past labor processes can turn out to be means of production in future labor processes. Marx looks at different examples of products that serve as raw material and instruments of labor, such as cattle, where the animal is raw material but also an instrument for producing manure. Eww.
- Instruments of labor should be considered products of past labor, though we forget that when we are busy working with them—until the tools fail, at which point we think of the toolmakers' errors.
- Labor consumes its objects and its instruments. This is called productive consumption, as contrasted with individual consumption, which is what happens when you drink a Monster Energy drink. Labor consumes instruments and its objects in order to make more products.
- Marx throws out some more big statements about what labor is. It's purposeful activity aimed at the production of use-values. It appropriates (takes advantage of) what exists in nature for people's living requirements. It's a permanent condition of human existence independent of all societies, whether they be capitalist societies, slave societies, or primitive ones.
- The capitalist is the consumer of the labor-power commodity. Workers labor under the control of the capitalist, who makes sure they do what they're ordered to. Whatever the workers produce belongs to the capitalist. From the capitalist's point of view, the labor process is just the consumption of the purchased labor-power commodity, which results in products that belong to him.
- Moving right along. Marx defines valorization as adding value.
- The capitalist, in control of the labor process, is interested in the production of exchange-values so that he or she can sell them. Exchange-values need to be worth more than the value that went into producing something, so that there will be a profit.
- Marx asks how we determine the value of the products made for the capitalist in the labor process. Then he kindly tells us the answer: the value of each commodity is determined by the quantity of labor contained in it, by the amount of socially necessary labor time. This includes the past labor that is present in the raw material and the instruments of labor.
- Marx gives us an example. Imagine cotton (raw material) and a socially average spindle (instrument of labor) worth 12 shillings (a former British coin). The capitalist wants to make yarn out of this stuff. So we have to add in here some labor, because the yarn isn't going to make itself. Marx says in our analysis we should use socially necessary labor-time, not someone who is taking forever and a day to make the yarn, but rather the healthy average. Imagine the labor is worth 3 shillings, because that's the value of the amount of time it takes to sustain the laborer creating the yarn.
- So the value of the yarn equals 12 shillings (10 for the cotton and 2 for the spindle's wear and tear) plus 3 shillings (for the labor). That's 15 shillings as the value of the yarn. Therefore 15 shillings is the fair cost of the product.
- That freaks the capitalist out, however. There's no surplus-value created by this example, no profit. Capitalists only get out of this sort of production process what they put in.
- Marx considers three objections the capitalist might make at this point based on the theories of what he calls vulgar economics, or the popular renditions of capitalist economics during his day.
- The first objection is the abstinence theory, that the capitalist is owed some reward because he or she refrained from wasting the 15 shillings. Marx says the reward is the yarn, not surplus-value.
- The second objection is that the capitalist supplied the instruments of labor, the employment, etc. Marx retorts that the workers also provide an equal service, and anyway, the point of the work was to make the yarn.
- Finally, the capitalist objects that he or she worked, too. If so, Marx says, the capitalist is paid as a manager, and not as a capitalist per se.
- Here's where the capitalist's trick comes in. The labor to make the yarn cost 3 shillings because that's the amount of work it takes to sustain labor-power. But that might only take half a day. There's still the other half of the day. That's when the capitalist can work the laborer for free and produce surplus-value. The laborer has to make twice as much yarn.
- No laws have been broken by this. The laborer sold his commodity, labor-power, and the capitalist used it. Of course, Marx doesn't think it's fair, but he points out that it is a depiction of how perfect capitalism is supposed to operate.
- Marx gets a bit of a headache talking about how the worker has to supply labor with an average or socially necessary degree of skill, because it'd really screw up the calculations if the worker were loafing on the job. But Marx's point is to examine regular, properly functioning capitalism, not exceptional cases where people are cheating the system in some way.