Groucho Marxism

Das Kapital is the foundational theoretical text in Marxist philosophy, economics, and politics. It is one of the most influential works of social science ever written and represents the culmination of Karl Marx’s lifelong project to develop a comprehensive theory of capitalism. The central argument, which runs through all three volumes, is that capitalism necessarily involves the exploitation of workers. In putting forth this argument, Marx synthesized, critiqued, and built on three main intellectual traditions: the classical political economy of Smith and Ricardo; the dialectical philosophy of Hegel; and the utopian socialism of Fourier and Proudhon. Marx’s aim in writing Das Kapital was, in his own words, to ‘lay bare the economic law of motion of modern society’.

The presentation of Das Kapital follows an ‘ascending path’, starting from the most abstract essence of capitalism and building up a theory from there. This is reminiscent of the axiomatic method in mathematics, which involves building a theory from a fixed set of axioms. Marx employs what he calls the ‘power of abstraction’ to analyse fundamental dynamics of capitalism. Das Kapital begins with a lengthy description of the commodity, which is a term used for anything produced by human labour that fulfills a human desire or want. The commodity may be considered the ‘elementary particle’ of capitalism. Hegel’s dialectic method is central to Marx’s approach in building up his theory; however, Marx adapts Hegel’s method by employing it in a materialist, scientific way.

The writing of Das Kapital was a long and arduous process spanning several decades. Marx’s perfectionism and tendency to get sidetracked delayed completion, as did his fondness for alcohol. It is well-known that only volume 1 of Das Kapital was completed in Marx’s lifetime, with volumes 2 and 3 being completed posthumously by Friedrich Engels, Marx’s long-time collaborator. What is less well-known is that Marx originally planned to write six volumes! Perhaps we should be grateful that he only managed three, as reading just one volume involves a significant investment of time. I personally have only managed to read volume 1 (so far). In the remainder of this blog post I will attempt to provide a short synopsis.

As mentioned above, volume 1 begins with a lengthy description of the commodity. There are two values associated with a commodity: a use-value, which is the value that arises from satisfying some human want or need; and an exchange-value, which may be defined as the proportion in which a commodity exchanges for other commodities. According to Marx, the ‘substance’ of exchange value is ‘human labour in the abstract’, and the magnitude of a commodity’s exchange value is determined by the ‘socially necessary labour time’ required to produce it. We now refer to this as the labour theory of value, although Marx himself never referred to it as such. This theory implies that exchange values are determined by social relations and are not properties of commodities themselves.

Marx then goes on to discuss what he calls the transformation of money into capital. He first talks about the simple circulation of commodities, whereby commodities are produced, brought to market and sold for some amount of money which is then used to buy other commodities. This is usually how we think of markets working and may be characterized as ‘commodities-money-commodities’, or C-M-C for short. However, what actually happens under capitalism is that a capitalist first invests some money to produce commodities, which are then brought to market and sold for more money than was originally invested. This may be characterized as ‘money-commodities-money’, or M-C-M’, where M’ is greater than M. The difference M’-M is referred to as ‘surplus value’.

A surplus cannot arise if equivalents are exchanged. So where does surplus value come from? The answer, according to Marx, is from workers – or more specifically from ’labour power’, the capacity to do work. Marx argues that in order for surplus value to arise, the value created by the labourer must be greater than the value of their own labour-power, which is what they receive in wages. Thus, the value that workers receive is lower than the value they provide, with the difference – the surplus value – being appropriated by capitalists. It is in this sense that workers are exploited under capitalism. This, I think, represents the key point of volume 1 and possibly even the whole of Das Kapital. The rate of exploitation is just the ratio of surplus value to wages, or ‘variable capital’ in Marx’s terminology.

Marx then goes on to discuss two different types of surplus value, which he terms ‘absolute’ and ‘relative’. Absolute surplus value is created by capitalists prolonging working time for longer than is necessary for workers to produce what they actually need. Working time thereby becomes a locus of the struggle between capitalists and workers, with the former seeking to prolong it and the latter seeking to shorten it. In contrast, relative surplus value is created by capitalists shortening the socially necessary labour time required to produce a given commodity or commodities. They can do this through the concentration of many workers under the command of a single capitalist, the division of labour, the introduction of new technology, or a combination of the three.

The final part of volume 1 concerns the process of capital accumulation. Under what Marx calls simple reproduction, the entire surplus is consumed by the capitalist. However, what usually happens under capitalism is that capitalists are driven to reinvest the surplus into further production; this is what is referred to as capital accumulation. Marx argues that capital accumulation relies on the constant maintenance of an ‘industrial reserve army’ of labourers – a permanent sub-class of unemployed workers. He then goes on to formulate what he calls the ‘law of capital accumulation’, which basically says that under capitalism, things only get worse for workers. Looking at how things are going at the moment, it is hard to disagree.