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Unfortunately, I have not had much time to follow the interesting
discussion between Rakesh and Paul C. and others about the relation
between labor-time and money in Marx's theory. But I noticed that Rakesh
mentioned my "monetary" interpretation of the initial givens in Marx's
theory (according to which the initial magnitudes of constant capital and
variable capital are taken as given in terms of money-capital) and that
Paul has criticized this interpretation. This is a brief response to
Paul.
I have explained the rationale for this assumption in several papers (the
main ones are my 1993 paper in *Marx's Method in Capital* and a
forthcoming paper in the RRPE ("A Sympathetic Critique of the `New
Solution'," which I would be happy to send anyone).
Let me try to briefly summarize the rationale for this interpretation:
1. The circulation of capital is the overall analytical framework for
Marx's theory, and is of course expressed symbolically as M - C - M', or
in its expanded form as M - C ... P ... C' - M'. This "general formula
for capital", it should be noted, BEGINS WITH MONEY, i.e. with M, a
certain amount of money-capital invested to purchase means of production
and labor-power. Therefore, this "general formula for capital" itself
suggests (especially in combination with the textual evidence and other
points discussed below) that the starting-point of Marx's theory, the
initial givens with which the theory begins, are the quantities of
money-capital, M, that initiate the circulation of capital, the process
that Marx is analyzing. The purpose of Marx's theory, in a nutshell, is
to explain how the given quantity of money-capital, M, increases its
magnitude, i.e. becomes M + dM. As Marx put it in the
"Results" manuscript (using in this passage x instead of M to stand for
money): "The fact that the purpose of the process is that x should be
transformed into x + dx also points to the path our own investigations
should take." (C.I: 977)
2. This interpretation is further supported by the logical structure of
Parts 1, 2, and 3 of Volume 1 of Capital. In Part 1, money is derived as
the necessary form of appearance of the value of commodities. In Part 2,
capital is defined in terms of this previously derived concept of
money: as money that becomes more money, i.e. as M - C - M'. Part 3 then
analyzes the origin of the increment of money that is characteristic of
capital, WITH THE INITIAL MONEY-CAPITAL TAKEN AS GIVEN. In this way,
Parts 1 and 2 provide the logical presuppositions (the "givens") for
Marx's theory of surplus-value in Part 3 and beyond. Marx did not
suddenly in Part 3 ignore the prior logical development of money and
capital in Parts 1 and 2 and introduce out of nowhere the technical
conditions of production and the real wage as the initial givens in his
theory of surplus-value in Part 3.
The Sraffian interpretation, on the other hand, has no explanation for
Marx's analysis in Parts 1 and 2 or for the logical relation between these
two parts and the theory of surplus-value in Part 3. These key parts of
Volume 1 are usually just ignored by this interpretation, and Marx's
theory is turned into Sraffa's theory, starting with the technical
conditions of production and the real wage.
Another related aspect of the logical structure of the first three parts
of Volume 1 is that Parts 1 and 2 are about the "sphere of
circulation" and Part 3 begins Marx's analysis of the "sphere of
production" (with the famous passage at the end of Part 2 about moving
from the "noisy sphere of circulation" to the "hidden abode of
production" marking the transition between these two stages of the
analysis). Marx argued that, in his theory of capital, the analysis of
circulation is a necessary prelude to the analysis of production because
the circulation of capital begins in the sphere of circulation; it begins
with the purchase of means of production and labor-power by a certain
quantity of money-capital in the sphere of circulation, i.e M - C. Again,
Marx's prior analysis of the sphere of circulation in Parts 1 and 2
provides the logical presuppositions (the "givens') for his later analysis
of the sphere of production in Part 3 and beyond.
Marx emphasized that the means of production do not simply enter
capitalist production as physical goods or as use-values; rather they
enter capitalist production through circulation, as commodities, with
prices; i.e. they have been purchased with a certain amount of
money-capital in the sphere of circulation. This quantity of
money-capital that initiates the circulation of capital prior to
production are the initial givens, the starting-point of Marx's
theory. As Marx put it succinctly in the "Results": "the means of
production enter production as COMMODITIES, i.e. as MONEY." (C.I: 952)
Again, the Sraffian interpretation of Marx's theory completely ignores
this initial analysis of the circulation of capital in the sphere of
circulation, and implicitly assumes that capital first appears, not in
circulation, but in production, as the physical inputs to
production. This is clearly not Marx's logical method in the first three
parts of Volume 1. The initial quantities of money capital that provide
the givens in Marx's theory of surplus-value come from circulation, not
from production.
3. Finally, this interpretation is strongly supported textually by
numerous passages throughout the various drafts of Capital in which Marx
explicitly stated that the money-capital which initiates the circulation
of capital is the "PRESUPPOSED capital" or the "POSTULATED capital" or the
"STARTING POINT" or the "POINT OF DEPARTURE" for his analysis of the
circulation of capital and the production of surplus-value. These
references can be found in Chapter 4 of Volume 1 of Capital and in the
earlier drafts of this chapter in the Grundrisse (G: 250-64) and in the
"1861-63 Manuscript" (Marx-Engels Collected Works, vol. 29,
pp. 501-07; and vol. 30 pp. 9-20 and 66-75). There are also numerous
similar passages in the "Results" manuscript. One especially clear
passage is the following:
"Here, where we are concerned with MONEY only as the POINT OF DEPARTURE
for the immediate process of production, we can confine ourselves to the
observation: capital exists here as yet only as a GIVEN QUANTUM OF VALUE =
M (MONEY), in which all use-value is extinguished, so that nothing but the
monetary form remains... If the ORIGINAL CAPITAL IS A QUANTUM OF VALUE =
X, it becomes capital and fulfills its purpose by changing into x + dx,
into a quantum of money or value = the original sum + a balance over the
original sum. In other words, it is transformed into the GIVEN AMOUNT OF
MONEY + additional money, into the GIVEN VALUE + surplus-value.... As a
GIVEN SUM OF MONEY, x is a constant from the outset and hence its
increment = 0. In the course of the process, therefore, it must be change
into another amount which contains a variable element. Our task is to
discover this component and at the same time to identify the mediations by
means of which a constant magnitude becomes a variable
one. (C.I: 976-77).
Nowhere that I know of did Marx refer to the means of production as the
"givens" or the "starting point" for his analysis of the circulation of
capital. Either Marx, who it should be remembered had a Ph. D. in
Philosophy and paid a great deal of attention throughout the various
drafts of Capital to questions of logical method, was extremely sloppy in
these many passages, or (which seems to me by far more
reasonable) Marxintended the usual methodological meanings for the terms
"given," "postulated," "presupposed," etc. - i.e. that they are the
initial data with which his theory begins.
4. Constant capital and variable capital are then defined in Chapter 8 of
Volume 1 as the two components of the money capital (M) that initiate the
circulation of capital. In other words, M = C + V. Constant capital is
the money capital used to purchase means of production and variable
capital is the money capital used to purchase labor-power. The key point
to be emphasized again is that constant capital and variable capital, like
the general concept of capital of which they are component parts, are
taken as given in terms of money.
I would of course appreciate comments, questions, criticisms, etc.
Comradely,
Fred
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