Re: Unproductive labor and the "Mage Heresy" II: A Reply to Fred

Fred B. Moseley (
Tue, 3 Feb 1998 15:02:19 -0500 (EST)

Thanks very much to Murray for his recent post, continuing the
discussion of the costs of unproductive labor - about whether these costs
are part of the surplus-value component of the price of commodities or
part of the constant capital component. Sorry for my delay in

I am glad that Murray seems to agree that the passages I had presented
in my last post do suggest that the costs of unproductive labor are
"deductions from surplus-value" and that the word "deduction" implies
a simple subtraction, i.e. an absolute deduction and not a "relative
deduction" as Murray has argued previously. Therefore, these passages
support the "standard" intepretation that the costs of unproductive
labor are part of the surplus-value component of the price of
commodities. However, Murray argues that these passages are
contradicted by at least three other passages and therefore that we are
forced to choose between two contradictory interpretations, each of
which is supported by different textual evidence. This post reviews
each of Murray's three passages.

1. First of all, Murray argues that the only place where Marx clearly
said what he meant by "deduction from surplus-value" is from the
Grundrisse (p. 548) in which it is described as an "increase of necessary
labor in relation to surplus labor." Murray continues:

This definition suggests that, as a proportion of the value of the
commdity, surplus-value will shrink as a result of an increase in the
value of the elements of cost-price (constant capital or variable capital or

But I do not see how Murray's conclusion follows. Murray seems to be
defining necessary labor to correspond to both constant capital and
variable capital. However, the concept of necessary labor, as I
understand it, is not related to constant capital in any way. Necessary
labor is a part of the total labor of the CURRENT period of production.
The total labor of the current period produces a certain quantity of value
added (what Marx often called "new value"). This quantity of "new
value" is then divided into two parts: one which is necessary to replace
the variable capital invested and the remainder which is surplus-value.
Necessary labor is the number of current hours required to produce "new
value" equal to the variable capital. Surplus labor is the rest of the
working day. Thus, necessary labor has nothing to do with constant
capital or the recovery of constant capital. Necessary labor is a part of
CURRENT labor; constant capital, on the other hand, is not replaced by
current labor, but rather from previously existing value which is
transferred to the price of the product.

This is exactly how Marx defined necessary labor and surplus labor in
Chapter 9 of Vol. 1. At the beginning of this chapter, constant capital is
subtracted from the total price of commodities; Marx said in effect that
constant capital is "set = 0". The remainder, after subtracting constant
capital, is the "new value" produced in the current period, which is then
divided into variable capital and surplus-value, which in turn is equated
to the division of the current working period into necessary labor and surplus
labor. Necessary labor has nothing to do with constant capital.

At a lower level of abstraction (including circulation labor), Marx
appears in this passage to redefine necessary labor and surplus labor,
compared to his earlier Vol. 1 definition (I know of no other such
passages). Necessary labor here is defined as the productive labor time
necessary to reproduce an equivalent both of the variable capital and the
costs of circulation labor, and surplus labor is the difference between the
total productive labor time and this necessary labor, as just redefined.
However, this does not mean that necessary labor also includes the time
necessary to reproduce the equivalent of the constant capital. Indeed,
this would contradict Marx¹s basic theory of value. Necessary labor is a
part of current labor and constant capital is not recovered from the value
produced by current labor.

Therefore, this passage about necessary labor in the Grundrisse
reinforces the standard interpretation, instead of contradicting it. If these
costs are recovered out of the value added by current labor, then they
cannot be a part of constant capital.

Furthermore, this passage further also supports the standard
interpretation that these costs of circulation are "deductions from
surplus-value" and that deduction means subtraction, not a "relative
deduction" as Murray suggests. The circulation costs increase necessary
labor (in this more concrete sense), and this increase of necessary labor is
SUBTRACTED FROM the abstract total surplus labor to obtain the
redefined more concrete restricted sense of surplus labor. Deduction
means subtraction. The increase of the ratio of necessary labor to
surplus-value does not result from an increase in the constant capital
component of the price of commodities.

Finally (on this point), this passage from the Grundrisse is not the only
passage in which Marx described what he meant by "deduction from
surplus-value." The most important such passage is Marx's "general
law" of circulation costs (from Chapter 6 of Vol. 2), which has already
been quoted several times in this discussion, and which states clearly
that the meaning of "deduction of surplus-value" is that these costs must
be recovered out of surplus-value and, in that sense, are a part of

The replacement of these costs must come from the surplus
product, and from the standpoit of the capitalist class as
a whole it forms a DEDUCTION OF SURPLUS-VALUE ...
(p. 226; emphasis added)

2. The "general law" of circulation costs just quoted starts with the

The general law is that *all circulation costs that arise simply
from a change in form of the commdity CANNOT ADD ANY VALUE
TO IT.* (pp. 225-26; double emphasis added)

Murray argues that this is a misstatement by Marx; Marx should have
said "cannot add any NEW value" to the value of commodities instead of
"cannot add any value." According to Murray, "OLD value" (value
transferred by the constant capital) IS ADDED to the value of
commodities, so that the total value of commodities INCREASES as a
result of circulation costs.

But Marx does not say here "cannot add any new value" (nor in the
numerous other places where Marx said essentially the same thing). He
says "cannot add any value." Neither "old value" or "new value". The
value of commodities remains the same as a result of the exchange

Furthermore, Marx's statement "cannot add any value" is consistent
with the sentence that follows (quoted above) in which the circulation
costs are described as "deductions from surplus-value", hence as a part
of surplus-value. If these circulation costs really were added to the value
of the product, as part of constant capital (as Murray suggests), then
they would be recovered out of this constant capital component and
would not have to be recovered from surplus-value.

So, in order to make Marx's statement of his "general law" of circulation
costs consistent with his interpretation, Murray has to say that Marx
made two big mistakes in this key passage: (1) he said "cannot add any
value" when he should have said "cannot add any NEW value;" (2) the
second sentence ("deduction from surplus-value") logically contradicts
the reinterpreted first sentence.

To the contrary, I think that Marx "general law" means exactly what it
says - that no value is produced in exchange and that circulation costs
must therefore be recovered out of surplus-value - rather than being a
sloppy misstatement and a basic logical contradiction.

3. The final passage left to support Murray's argument is the following
passage from Vol. 3 (pp. 405-06):

Although [circulation capital] forms additional capital, it does not
form any more surplus-value. It must be replaced out of the
commodities' value, for a portion of this value must be reconverted
back into these circulation costs... [The] additional value that
[the merchant] adds to commodities to his expenses is reducible to
the ADDITION OF PREVIOUSLY EXISTING VALUES, even though the question
still arises here as to how he maintains and conserves the value of
this constant capital. (emphasis added)

Murray argues that this passage states that circulation costs
increase the value of commodities and that this addition to the value of
commodities comes from "previously existing value", which is similar to
constant capital.

This passage actually consists of two parts which are a page and a half
apart in Marx's text. The first part does not state that circulation
costs increase the value of commodities. Rather it says that they do not
increase the surplus-value and that they must be recovered out of the
value of commodities. This statement is by itself consistent with with
the standard interpretation or with the Mage-Murray interpretation.
These costs could be recovered out of the constant capital or the
surplus-value component of the value of commodities.

The second part of Murray's quoted passages is a parenthetical remark.
The sentence within which this parenthetical remark is made begins as

Since the merchant, being simply an agent of circulation,
(for the the additional value that he [the merchant] adds to
commodities ... )

On the face of it, the first part of the sentence ("the merchant ...
produces neither value nor surplus-value") appears to be contradicted by
the parenthetical remark ("the additional value that the merchant adds to
commodities").However, I think what Marx meant by "additional value"
in his parenthetical remark is made clear from the general context of this
passage. Marx was discussing in this chapter the price mechanism
through which merchants are able to recover their costs and make a
SURPLUS-VALUE (that is the general presupposition throughout).
This mechanism is that the "wholesale" price at which industrial
capitalists sell to merchants is less than the full value (or price of
production) of commodities, which is determined solely in production.
The "retail" price at which merchants sell is then the full value (or
price of production) of commodities. The difference between the
merchant's buying price and selling price enables him to recover his costs
and make a profit. But this "ADDITION" to the whosesale price is in
reality nothing but the realization of value that was "PREVIOUSLY
EXISTING" but not fully realized in the sale of the producer to the

Marx said exactly this a few pages earlier:

In the supplementary equalization of profits brought about by
the intervention of commercial capital, we saw that NO ADDITIONAL
the money capital that the merchant advances, and that the ADDITION
TO THE PRICE, whereby the merchant makes his profit, is simply the
portion of the commodity value that productive capital has not
included in the production price of the commodity, and has in fact
left out. (p. 401; emphasis added)

So it seems to me that within this broader context of the entire chapter,
the parenthetical remark quoted by Murray does not support his
interpretation. Furthermore, even if Murray's interpretation of this
passage were accepted, then we would be faced with a choice between
one parenthetical remark in which Marx said that circulation costs "adds
to the value of commodities" - a passage which could reasonably be
interpreted differently - and all the other passages that we have
discussed in my previous post and in this post in which Marx stated that
circulation costs "do not add to the value of commodities" and that they
are "deductions from surplus-value." Maybe Marx was inconsistent in
this one parenthetical remark (I don't think so), but all the other
textual evidence overwhelmingly supports the standard interpretation.

4. Finally, Murray makes a "still more fundamental point", and argues
that there is an "elementary logical problem" with the standard
interpretation: "how can a cost - any cost - be both a "deduction from
surplus-value" and a component of surplus-value? How can a deduction
from surplus-value still be a part of it?"

I do not see the logical problem here. The total amount of surplus-value
(S) is first determined as the difference between the total value added
(VA) and the variable capital (V)

S = VA - V

According to Marx's theory, a part of this surplus-value has go to
recover the unproductive circulation costs (U). In this way, these costs
are "deductions from surplus-value." The remaining difference - after the
"deduction from surplus-value" - is the profit of capitalists (P):

P = S - U

In other words, the total surplus-value is divided into two parts: one
part that pays for unproductive costs and the remaining profit for

S = P + U

In this sense, the unproductive costs of circulation are both deducted
from surplus- value and are one part of the surplus-value.

So I don't see the "elementary logical problem". Am I missing

Thanks again for the stimulating discussion.