Money and Price

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commodity capitalist society
Price is the money-name of the labour objectified in a commodity (Marx
1867c, 195196). A commodity expresses its value in the money price. Money is
a measure of the value of a commodity. It is the most developed form of value.
The money price is a specific monopolized form of the appearance of value that
shapes exchange in capitalist society by acting as generalized medium of exchang
e
in (almost) all market relations in which commodities are exchanged. Money has a
social monopoly [. . .] to play the part of universal equivalent within the world
of
commodities (ibid., 162). Money is related to the class conflict between labour
and capital (Cleaver 2000, 156158): Capital aims at lowering the price of
wage labour (wages) and increasing the price of commodities in order to increase
profits. Workers can refuse work in the form of strikes and thereby attack the
wage mediation and money profit, and they can refuse or eliminate prices by tryi
ng
to obtain use-values below market prices or for free (e.g. by refusing to buy
certain products and producing them together with others). So money is not only
a medium of circulation, but also a mediator between the classes (ibid., 158) and
an object of class struggle.
That two commodities have the same price does not mean that they necessarily
have the same value, only that they are assessed as having the same value.
Marx argues that value and price do not necessarily coincide. There can be
incongruences and oscillations: The magnitude of the value of a commodity
therefore expresses a necessary relation to social labour-time which is inherent
in the process by which its value is created.With the transformation of the magn
itude
of value into the price this necessary relation appears as the exchangeratio
between a single commodity and the money commodity which exists
outside it. This relation, however, may express both the magnitude of value of
the commodity and the greater or lesser quantity of money for which it can be
sold under the given circumstances. The possibility, therefore, of a quantitativ
e
incongruity between price and magnitude of value, i.e. the possibility that the
price may diverge from the magnitude of value, is inherent in the price-form
itself (Marx 1867c, 196).
Socially necessary labour time is the centre of gravity around which price
turns (Marx 1894, 279).Value is the centre of gravity of market prices, the axis
round which these fluctuate (Bidet 2009, 81). The commodities whose individual
value stands below the market price will realize an extra surplus-value or
surplus profit, while those whose individual value stands above the market price
will be unable to realize a part of the surplus-value which they contain (Marx
1894, 279). The market value is always different, is always below or above this
average value of a commodity. [. . .] The price of a commodity constantly stands
above or below the value of the commodity, and the value of the commodity
itself exists only in this up-and-down movement of commodity prices (Marx
1857/1858, 137). In Hegelian dialectical language, one can say that the price is
a
constant negation of the negation, i.e. of itself as negation of real value (ibid.
).
Robert Kurz (2012, 184) argues that prices cannot be read off commodityvalues,
but that values and prices are also not independent. For example, the price
of a toothbrush would always be much lower than the one of a car because the soc
ially
necessary labour to produce a toothbrush would necessarily be much lower
than the one required for a car. At the same time, there would be no guarantee
that the desired price can be achieved on the market because heavy competition
could force capitalists to sell their commodities below the commodities value
(ibid., 185).
The transformation problem deals with the question of how values are transformed
into prices. Based on Moishe Postone (1993), one can argue that the
engagement with this problem is based on the assumption that Marxs theory
can be used for deriving a price theory and on the assumption that this was also
Marxs intention. Postone (1993, 134) in contrast argues that the divergence of
prices from values is integral to [. . .] Marxs analysis. Marxs intention is not
that disguises it (ibid.).The price form veils the specificities of value.
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2.3.2.4. The Value and Price of Labour-Power
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Imagine two situations:
!
(1) There is only one company in the world producing computers and there is a
significant demand for this type of good.There is almost unlimited supply of
the workforce and a securitization of work by military means:Workers who
resist working are shot. There is no labour legislation, i.e. the owners of the
computer company are free to choose the standard work time, wages, rest
times, etc. It takes on average 15 minutes to assemble one computer and the
price of one computer is 500 Euros.There are fixed constant capital costs of
100 Euros.The price depends on the investment costs. Given that the labour
supply is limited, capitalists will try to reduce the labour costs to a minimum
in order to maximize profits. In the example, they can, as a result of the fasci
st
conditions of production, enslave the workers, pay no wages, and thereby
maximize the profit to the possible maximum of 400 Euros.
(2) There is a regime change and labour legislation is introduced. There is now
a minimum wage that requires the capitalist in the first example to pay 200
Euros in wage costs for the production of one computer. The production
conditions remain unchanged, the constant capital costs are still 100 Euros.
The capitalist is used to making 400 Euros profit per computer; based on the
calculation that he makes a profit of 400% per computer he has acquired a
luxurious lifestyle that he does not want to give up. If he demands the same
price for each computer, the profit per commodity will halve from 400
Euros to 200 Euros. Given that there is no competition but a high demand
for computers, he decides to increase the price of one computer from 500
to 700 Euros, which allows him to continue to achieve a profit of 400 Euros.
!
The examples aim to show that prices cannot simply be derived and calculated
from labour values, but depend on the politics of class struggle. Jacques Bidet
(2009) therefore speaks of the sociopolitical concept of value that is coupled t
o
the political-economic concept of value. In capitalism, labour as the substance
of
value is coupled to the social compulsion for the expenditure of labour that is
exercised over the workers by the capitalist class (ibid., 51). Labour is therefor
e
a class concept and value is connected to labours class relation to capital. Capi
tal
has to secure the command over labour, which is a political task. Labour can try
to resist this command, which would be a political answer to this command. If
the substance of value is abstract labour, expenditure, it is coupled in the mode
of production with its correlative, the social compulsion for this expenditure
(a market compulsion exercised over the workers by the capitalist class), with
which it forms, in the unity of the concept, a social and class relationship (ibi
d.).
The concepts of value and abstract labour are therefore simultaneously an expres
sion
of political economy and sociopolitical class struggle. Also Marx stressed
this connection in relation to the value and price of labour: During the time
of the anti-Jacobin war, undertaken, as the incorrigible tax-eater and sinecuris
t,
old George Rose, used to say, to save the comforts of our holy religion from the
inroads of the French infidels, the honest English farmers, so tenderly handled
in
a former chapter of ours, depressed the wages of the agricultural labourers even
beneath that mere physical minimum, but made up by Poor Laws the remainder
necessary for the physical perpetuation of the race. This was a glorious way to
convert the wages labourer into a slave, and Shakespeares proud yeoman into a
pauper (Marx 1865).
The sociopolitical concept of class has led Bidet (2007) to stress that capitali
sm
really poses the market and the organization, the two mediations, the two forms
of rational-reasonable coordination at social scale, as its logical presuppositi
ons. It
poses them while turning them into the two class factors which are combined in
the modern class relation. Although coming from another background, namely
Autonomous Marxism, Harry Cleaver (2000) argues like Bidet for a political
reading of Marxs Capital. Like Bidet, Cleaver also sees class relations as an imp
ortant
aspect of value:The exchange-value of labour-power is, as we have seen,
the money which the working class receives for its sale.Yet for the working clas
s
this exchange-value is at once income and a source of power in its struggle with
capital, while for the latter it is a cost and a deduction from total value prod
uced,
a threat to surplus value and thus to capitals power. Because of these difference
s
there is often a struggle over the form in which the working class will receive
the
exchange-value of its labour-power: money wages, wages in kind, social services,
welfare, unemployment benefits, pensions, and so forth (Cleaver 2000, 101).
What is the value of labour-power? The value of labour-power is determined,
as in the case of every other commodity, by the labour-time necessary for the
production, and consequently also the reproduction, of this specific article. [.
. .]
the value of labour-power is the value of the means of subsistence necessary for
the maintenance of its owner (Marx 1867c, 274).The means of reproduction of
a worker include his/her own subsistence costs and the ones of her/his family,
education for obtaining skills, and health care for maintaining in a physical an
d
mental status that allows the continuance of work. Harry Cleaver stresses in thi
s
concept the Autonomous-Marxist concept of the social worker and the social facto
ry:
Both housework and schoolwork are intended to contribute to keeping the
value of labour-power low (Cleaver 2000, 123).The more unpaid labour time is
available in the reproduction of labour-power, the more the amount of variable
capital necessary for the reproduction of the working class decreases, so that th
e
social worker in the social factory contributes to the expansion of surplus value
(ibid.). The technical changes of capitalism (i.e. the technical increase of pro
ductivity
or what Marx termed relative surplus-value production) result, as Mario
Tronti (1962) argues, in the emergence of a social factory.