The illusions of capitalism

Reading Marx’s Capital – Vol 1, Class 2

Entering the Matrix

The first lecture had about 830k views, this one has around 136k, so by getting this far, I guess I’m in the top 16% of the class.

The video goes over chapters 1 and 2 of Capital, which is hard and painful reading. From what I read today, this is a good thing as this will help me on the road to superaging, which means you need to do things that make you feel pretty bad — tired, stymied, frustrated.

Kind of sums up my Marx experience so far, like The Matrix, this session challenged me to try and see what underlies the “socially valid” experience of the world

           / Use      \          Socially       / Abstract \            
Commodity <            > Value < Necessary   > <  [Labour]  > Exchange < (continued)
           \ Exchange /          Labour Time    \ Concrete /            

          / Relative   \
Exchange <              > Money Commodity 
          \ Equivalent /

In the last lecture, we’d got to value being “socially necessary labour time” (in red in the picture above). This section starts to unpack this definition. Labour has a dual character, concrete and abstract, but in the end, there is only one labour process, the question is how to find the abstract value and the answer is the two come together at the time of exchange.

Note about Nature

As William Petty says, “Labour is the father of material wealth, nature is the mother”, so nature has a part to play, especially as nature contains the raw resources that labour operates on.

Skill to Simple Labour

Simple average labour, “the labour-power possessed in his bodily organism by every ordinary man, on the average, without being developed in any special way” (page 135). This is a reduction Marx makes often, like any economist, and it’s forced upon him in order to move forward.

Value and Productivity

On the surface, value is dependent on productivity, but “an increase in the amount of material wealth may correspond to a simultaneous fall in the magnitude of its value” (page 136-137).

So here is where it gets messy.

The same labour, therefore, performed for the same length of time , always yields the same amount of value, independently of any variations of productivity. But it provides different quantities of use values during equal periods of time.
Capital: Critique of Political Economy v. 1 (Classics S.), page 137

Material wealth is not the same as value. When it becomes more productive, useful, concrete labour becomes a more abundant source of products, or material wealth, but have no effect on value.

Value is immaterial but objective, and it’s immaterial because it’s a social relation, “it can only appear in the social relation between commodity and commodity” (page 139), it becomes objectified in the commodity.

It gets even messier here because it’s a process that’s being objectified. Firstly as concrete labour is transformed into generic labour.

It is only the expression of equivalence between different sorts of commodities which brings to view the specific character of value-creating labour, by actually reducing the different kinds of labour embedded in the different kinds of commodity to their common quality of being labour in general.
Capital: Critique of Political Economy v. 1 (Classics S.), page 142

And secondly, as that general labour is crystalised into commodity form as an expression of that labour.

Although it is labour of private individuals, it is nevertheless labour in its directly social form. It is precisely for this reason that it presents itself to us in the shape of a product which is directly exchangable with other commodities.
Capital, page 150

And so we move from the exchange of one commodity with another to using money as an intermediate step. The main point is that for us to move from 1 to 4 (see Extra Note below), the exchange has to be generalised and systematic. And when the exchange has become customary, the values appear to come from the nature of the products.

The next step, the standard form of value (money, gold) morphs into a universal equivalent, money becomes the expression of value.

Finally, a particular kind of commodity acquires the form of universal equivalent, because all other commodities make it the material embodiment of their uniform and universal form of value.
Capital, page 160

The Fetishism of the Commodity

For me, this section is where things started to come together.

People under capitalism do not relate to one another as human beings, they relate to one another through the products they encounter in the market.

The mysterious character of the commodity-form consists therefore simply in the fact that the commodity reflects the social characteristics of men’s own labour as objective characteristics of the products of labour themselves…the definite social relation between men …assumes here…the fantastic form of a relation between things.
Capital, pages 164-165

Following this through leads to some disturbing consequences.

Running down the value chain, this puts us into relationships with the global economy. Rather than the people we see and interact with every day, commodities put us in far wider relationships – what do we know about the people who produced our breakfast? Working back through the value chain there and all the people who came into contact with the machinery, power, grain etc. What do we know about those people?

This is far wider than the religious “love thy neighbour”, which applies to face to face relationships (what we can see); we have no idea who our neighbour is in this conception. We might see it in supply chain issues (conditions of Apple or Nike manufacturing subcontractors), but it is very remote.

This is what the market system, money, conceals from us. Value, therefore, does not have its description branded on its forehead; it rather transforms every product of labour into a social hieroglyphic.
Capital, page 167

So Who is in Control?

Not us.

For Adam Smith, it’s the “hidden hand of the market”.

For Marx, it’s back to the socially necessary labour time, which is embodied in commodities and is the basis of the exchange rate between commodities, or value. But for Marx as well, this constant or underlying basis is hidden, and to the participants “these magnitudes of value vary continually, independently of the will, foreknowledge and actions of the exchangers” (page 167). Nonetheless, it remains as a regulatory principle, a control. “In the midst of the accidental and ever-fluctuating exchange relations between the products, the labour time socially necessary to produce them asserts itself as a regulatory law of nature” page 168.

Appearance and Reality When Appearance Is Reality

Marx then moves into how to think about the world when appearance is different to reality. Marx is trying to construct a science to look at this and finds many others have simply been deluded by appearances.

But the surface appearances are real. The analogy here with psychoanalysis – the surface behaviour conceals something else, but the reality of the behaviour of the affected person must be dealt with as it is really happening, there is just something we can’t see going on behind it.

It is however precisely this finished form of the world of commodities – the money form – which conceals the social character of private labour and the social relations between the individual workers, by making those relations appear as relations between material objects, instead of revealing them plainly.
Pages 168-169

The trouble is these surface appearances are “socially valid, and therefore objective for the relations of production belonging to this historically determined mode of production” page 169.

Actions are Commodities Too

Had an additional thought here on the fetishism side of things that our behaviour is also alienated. When confronted with a situation, we often think of how we should react, and a lot of that comes from the actions of characters in books and movies, which could also be termed commodities. So just as our labour is alienated away from us and given a homogenous value, so too are our actions. They are not the natural (concrete?) actions we might have given ourselves, but rather the actions society expects of us.

Chapter 2: The Process of Exchange

The constant repetition of exchange makes it a normal social process. In the course of time, therefore, at least some parts of the products must be produced intentionally for the purpose of exchange. From that moment the distinction between the usefulness of things and their usefulness in exchange becomes firmly established.
Capital, page 182.

In the end, Marx accepts Adam Smith’s version of the hidden hand. Autonomous individuals acting freely in the market would produce a social good for the benefit of all. Classical economics (liberal theory) held that the market would produce a good result if everything else was got out of the way.

Having accepted this, he then attempts to prove that given their premises, the closer it gets to its conclusion, the But he then asks the question, does this really benefit everyone?


Going through this took a lot of time and mental effort, but it did start to clarify some things for me.

The old theme of appearance and reality is a good way to understand it; things appear to be one thing (and they are very real), but there might be an underlying reason things are the way they are.

But custom and repetition mean it’s difficult to see this underlying reason. David Hume said you can’t derive an ought from an is, but we accept what is as the only thing there is because we can’t see underneath the structure. The surface is real, it’s “socially valid” and convenient to accept, but bourgeois might not be the only form society can take.

Like The Matrix, Marx challenges us to see there might be another way.

It is however precisely this finished form of the world of commodities – the money form – which conceals the social character of private labour and the social relations between the individual workers, by making those relations appear as relations between material objects, instead of revealing them plainly.
Pages 168-169

Extra Note: First, Second, Third, Fourth Form

Below are my notes on the development of the argument from commodities to money. Took way too long and not ultimately all that relevant, but I just couldn’t bear to push delete!

Notes on theMarx’s reasoning takes three steps, broadly as below:

  • In the first form,
    X commodity A (relative) = Y commodity B (exchange)
    can go forward and backwards on this.
  • In the second form, the expanded form,
    X commodity A = Y commodity B = Z commodity C, etc.,
    can’t be reversed. Only one single commodity at a time can expand its relative value, so to get from A to C, we have to go via B.
  • In the third form, the general social relative form, a commonly traded commodity takes the form of exchange value, this means we can eliminate some of the steps of the second form.
         Y commodity B = X commodity C
    or Z commodity C = X commodity C
  • In the fourth form, the general social relative form, a particular commodity (money) (relative) = all commodities; a universal equivalent, this is excluded from the relative value form. Money is relatively expressed by all commodities.
         Y commodity B = X money
    or Z commodity C = X money

One thought on “Reading Marx’s Capital – Vol 1, Class 2

  1. Pingback: Reading Marx’s Capital – Vol 1, Class 3 | Another five foot shelf

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