[OPE-L:6919] Re: Re: Re: Re: Re: Re: Re: Re: value-form

From: nicola taylor (n.taylor@student.murdoch.edu.au)
Date: Sat Apr 06 2002 - 00:18:57 EST

Rakesh [6910], below is a 'sketch' of the 'circulation of capital' (*my
interpretation*, drawn mostly from the first four chapters of C2).  For a
much deeper and better analysis, of the circuit's content and methodology,
I highly recommend:

 Chris Arthur (1998): 'The Fluidity of Capital and the Logic of the
Concept', in C.J. Arthur and G. Reuten (Eds.), *The Circulation of Capital:
Essays on Volume 2 of Marx's Capital* London, Macmillan, pp.95-128  

>>Yes, we disagree profoundly.  For me the forms of capital (constituted as
>>circulating capital through moments of exchange, production and exchange)
>>do indeed describe the true essence of capitalism as a form-determined
>>system.  From this disagreement, all other disagreements follow.
>Well, then let's clear about what you are saying here!
>(1) what are the forms of capital?

The forms of capital are the circuits of: Money Capital [Form 1: M...M'],
Productive Capital [Form 2: P...P(P')], and Commodity Capital [Form 3:
C'-C'] (chapters 1-4, Capital 2).Chapter 1 of Capital, volume 2, and
summarised by him in Ch.1 (C2, p.133):

	"The two forms that capital assumes within its circulation stages are
those of money capital and commodity capital; the form pertaining to the
production stage is that of productive capital.  The capital that assumes
these forms in the course of its total circuit, discards them again and
fulfils in each of them its appropriate function, is industrial capital -
industrial here in the sense that it encompasses every branch of production
that is pursued on a capitalist basis.
	Money capital, commodity capital and productive capital thus do not denote
independent varieties of capital, whose functions constitute the content of
branches of business that are independent and separate from one another.
They are simply particular functional forms of industrial capital, which
takes on all three forms in turn" (C2, p.133). 
Industrial capital as the producer of value is 'the subject of circulation'
the movement of which is 'posited as its own life's course' (Marx, 1857-58,
p.620).  All (functional) differentiation of the concept of capital into
its Forms has a relative appearance in the context of a total process, such
that the 'fixity' of capital in any one of these 3 forms cannot be
understood apart from the movement of one form towards another - which
continuously reconstitutes the 'unity' of the whole (on this see Marx,
1861-63, CW, vol 32, p.480). 

>(2) why do they apparently reduce to circulating capital?

The forms never *reduce* to circulating capital, they together *constitute*
circulating capital.  Why? Because, capital is not a quantity or a thing,
but a 'process' that presents 'as the unity of the process of production
and the process of circulation, where the production process is the
mediator of the circulation process and vice versa (Marx, C2, p.180).  What
is more, any particular form comprises but an interruption of the
metamorphoses of capital. As long as capital is 'fixated' in production it
is 'virtually devalued' but as long as it is circulating it is 'not capable
of positing surplus value'.  Thus 'unity' is capital's 'formal
characteristic', as Marx explains in Grundrisse (pp.620):

	"As the subject predominant [ubergreifend] over the different phases of
this movement, as value sustaining and multiplying itself in it, as the
subject of these metamorphoses proceeding in a circular course - as a
spiral, as an expanding circle - capital is **circulating capital**.
Capital is therefore initially **not a particular form of capital**, but is
rather capital itself, in a further developed aspect, as subject of the
movement just described... But while capital thus, as the whole of
circulation is circulating capital, is the process of going from one phase
into the other, it is at the same time, within each phase, posited in a
specific aspect, restricted to a particular form, which is the negation of
itself as the subject of the whole movement.  Therefore, capital in each of
its particular phases is the negation of itself as the subject of all the
various metamorphoses.  Not-circulating capital" (C2, pp.620).

My interpretation of this: 'capital itself' is a self-directed movement
towards the goal of its own realisation - - this involves a notion of the
irreducible totality of its three forms.  The concept of capital emerges
only within circulation as the 'unity', Marx says, of these forms.
Conversely the dissolution of capital into its particular forms - its
concrete determinations as money, means of production, commodities not yet
brought to market - are necessary to the practical reality (existence) of
capital as self-valorising value.  And value is properly the continual
advance of capital 'in which the same phases are continuously gone through
in succession'.  Or, as Chris A succinctly puts it, capital is motion:
'capital maintains its identity with itself through its flow' (Arthur,
1998, p.99).  

It's a mistake - from this point of view - to treat Marx's circuit of
capital as an economic 'model' where the moments of the circuit can be
broken down into production and exchange, with the former (or the latter)
afforded analytic priority.   The quality of capital is its continuous
circulation through moments of production and exchange.  Only as
circulating capital does value become 'value in process, money in process,
and, as such, capital' (Marx, C1, p.256).  If the circuit of industrial
capital is broken down into aliquot parts, the concept of capital loses its
fundamental economic meaning; all that is left is the circulation of
commodities on the one hand (an indeterminate exchange relation), and on
the other hand an immediate production process (an indeterminate production
>(3) as means of production (iron goods for example) and cotton cloth 
>in particular were bought on the market and such purchases often 
>financed by debt (which worked against a return to natural economy as 
>Blackburn underlines in implicit response to Charles Post),  why were 
>these 'investments' not forms of (constant and variable) capital?

This is a simple matter of logic:  
a) I posited the Value Form as the abstract expression for market
determinations that allows dissociated (i.e. 'free') labour to be
re-associated with means of production (I explicitly mentioned the labour
market as an example).
b) I posited value as the concept for 'forms' that arise in this Value-Form
determined system: commodity-form, money-form, capital form, etc 

Therefore, The commodity form is a Value form; i.e. commodities can only be
produced by wage labour.  Assuming that the iron and the cloth that you
talk about (above) are commodities (produced by wage labour), then they
enter circulation in the first stage of the capital circuit as debt
financed means of production.  Do means of production in themselves produce
surplus value?  I suppose not; to produce surplus value a second exchange
would have to take place in the first stage of the circuit; i.e a purchase
of wage labour (see justification next para).  Suppose now that these
commodities leave the circuit of capital and are now worked up into new
products by slaves, do the new products contain surplus value?  I suppose

Simply, the products worked up by slaves do not contain new value.  To say
that they do confuses potential exchange-value for value and the exchange
relation for the "capital relation which arises only in the production
process because it exists implicitly in the act of circulation, in the
basically different economic conditions in which buyer and seller confront
one another, in their class relation" (Marx, C2, p.115).  This is exactly
the conclusion to Marx's argument (C2, pp.113-118) for wage labour as the
necessary and sufficient condition for 'production that is pursued on a
capitalist basis'.  It is expressed in first stage of circulation in the
purchase of labour power (denoted L, by Marx: hence (M->L):

	"M-L [the exchange of money for labour power] is the characteristic moment
of the transformation of money capital into productive capital, for it is
the essential condition without which the value advanced in the money form
cannot really be transformed into capital, into value-producing surplus
value.  M-mp [the exchange of money for means of production] is necessary
only to realise the mass of labour bought by way of M-L" (Marx, C2, p.113).

Wage labour is necessary to the capital relation because: 1) it is the
*only* input that turns money into money-capital (the first form of
capital), and 2) it is the presupposition of its further transformation
into 'productive capital', and the latter depends not on money's function
as a means of payment (as you are suggesting) but upon the existence of
wage labour (i.e. the use to which the means of payment are put).  In
short, money becomes money-capital (a capital form) only when it enables
particular agents in the economy to *buy* the commodity labour power (as an
input to production).  This means (imo) that hte Value-form is an
opposition of possession, that alone enables labour power (a
non-capitalistically produced phenomenon) to take the form of a use-value
sold on markets to the possessors of means of production (Marx, C2,
113-118).  The separation of labour power 'from the objective means of its
application' and the need to overcome this separation in labour markets, is
the 'true' essence of the capitalist mode of commodity production and
characterises it as the only true form of monetary economy in which both
labour power and money enter into the productive process as capital (an
argument by implication from, C2, p.114)   
A conclusion logically follows.  If wage labour is essential for
'production that is pursued on a capitalist basis', and the monetary wage
contract is a 'fundametnal characteristic of the capitalist mode of
production' (C2, p.111), then it logically follows that these are necessary
in order taht money borrowed and advanced can exist 'in the state or form
of productive capital, with the ability to function as creator of value and
surplus value (p.111).  Since capital is not a thing but the motion and
metamorphosis of its forms, capital produces value from wage labour.
>Marx is describing a theoretically pure capitalism. Now you are going 
>on Marx's words: just because Marx only deals with this form of 
>proletarian exploitation in his pure theoretical work does not mean 
>that this can be the only form of exploitation consistent with the 
>production of capital and surplus value.

If capitalist production is a social form based on wage labour, a variety
of forms of exploitation are ruled out.  Slaves do not produce commodities
(values) just because they produce products (exchange values) for markets.
Producers using slaves may take advantage of capitalist markets, but the
exchange relation shouldn't be confused with the capital relation (which
implicitly refers to the whole of the circuit and conditions for its
reproduction, as Marx himself was at pains to point out).  Of course, we
don't need to go on Marx's words (it is just that I find them to make a lot
of sense in this context).  Consider the alternative.  If capitalist
production is possible on the basis of slave labour, serf labour and wage
labour, how is a theory of a specifically capitalist exploitation possible?
 Production for markets, lending and borrowing, are not after all the
features distinguishing capitalism from other social forms.       

>His journalism is quite responsible, and massively 
>informed. You ask me how I have a life forwarding journalism to this 
>list. How did Marx have a life writing journalistic work like this 
>along with his theoretical investigations.  A lot can be learnt from 
>reading it.

I believe you, but its a question of time!  Hence my awe of those who
manage it :)
best N.
Nicola Taylor
Faculty of Economics
Murdoch University
South Street
W.A. 6150

Tel. 61 8 9385 1130 
email: n.taylor@stu.murdoch.edu.au

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