Notes for a talk on communism and free time

by Jehu

This essay is to serve as talking points on communism and free time in Marx’s labor theory of value. This summary is mostly drawn from the Grundrisse, specifically the so-called fragment on the machine. It is not in final form. I am circulating it to serve as the basis for discussion. The talking points also do not offer any proof for any of Marx’s arguments. Nothing I say here argues that Marx was right, only that this is the argument he makes in the Grundrisse.

My approach to the subject assumes that communism can be defined as free time and nothing else. Following this logic, capitalism is conceived of as the creation of the material foundation for non-labor for the majority of society.

By way of introduction, it should be noted that this short passage from Marx is from a collection of notebooks that was mostly unknown until around 1973, when it was translated into English by Martin Nicolaus and made widely available. Although it had been published as early as 1939, sources state only 3-4 copies of the notebooks that together compose the work ever reached the West until Nicolaus translated it.

As can be seen from my summary, Marx predicted the end of production based on commodity money (exchange value) was inevitable. The prediction, however, never known until the gold standard had actually already collapsed in 1971. As a result, Marx’s prediction has never been adequately integrated into Marx’s theoretical model by Marxist academics and economists.

The Grundrisse thus gives a much different perspective on events of the 20th century, from the two world wars to the Great Depression to the collapse of Bretton Woods money system in 1971 as well as many events within the world market thereafter.

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1. Necessary labor and automation

According to Marx, the buying and selling of labor power for money (i.e., wage labor) is the ultimate development of production founded on exchange value. In the literature, production based on exchange value is also sometimes referred to as “simple commodity production”, production based on exchange, or market production.

Production based on exchange value means, among other things, that production is carried on separately by individuals or groups within the community of producers and the products of this labor is later exchanged among them. Fully developed production based on exchange implies the necessary role of money as the medium for circulation of commodities. The prices of commodities, expressed in some money form, more or less equals the labor times expended on their production.

In the mode of production founded on exchange value, the determinant factor in the production of wealth is the mass of direct labor time expended in production. However, with the emergence of capitalism and the subsequent emergence of large industry, the production of real wealth (examples: shoes, houses) increasingly depends less on direct labor time. Instead, production increasingly comes to rely on the application of science and technology to production. Machines take the place of human beings in production.

The quantities of material wealth created by application of science and technology grows dramatically in comparison to a relatively small application of living labor in their production. In time, the production of material wealth (shoes, houses) comes more to depend on the application of science and technology in production than it depends on living human labor.

The increasing reliance on science and technology in production is at the same time the development of something very similar to what we today call Artificial General Intelligence:

“The development of fixed capital indicates to what degree general social knowledge has become a direct force of production, and to what degree, hence, the conditions of the process of social life itself have come under the control of the general intellect and been transformed in accordance with it. To what degree the powers of social production have been produced, not only in the form of knowledge, but also as immediate organs of social practice, of the real life process.”

Marx is thus predicting that there is a point where the production of goods will require so little human labor and becomes so reliant on science and technology that the expenditure of human labor will no longer serve as the measure of the value of the goods. Machines, not living labor, will become the immediate organs of production. These machines will essentially incorporate our scientific knowledge of physical laws directly into the production process.

With the shift of production from the direct application of human labor to the application of science and technology, production based on exchange value (on the application of human living labor in production) breaks down (collapses). Which is to say, the prices paid for commodities would no longer express the socially necessary labor time required for their production.

Although Marx is general associated with the idea that the price of a commodity is an expression of its value, most people don’t realize Marx predicted the equality between prices and values would eventually break down. After that point, prices would no longer reflect the values of commodities. Marxists at the turn of the 20th century were deeply divided over whether Marx’s theory predicted this fundamental premise of the capitalist mode of production would collapse. The debate pitted the so-called catastrophists (those who believed capitalism was headed for collapse) against non-catastrophists (those who believed capitalism would gradually evolve into communism).

It was not until the publication of the Grundrisse that the issue was settled: Marx was a catastrophist.

2. Automation and the creation of disposable labor time

Besides progressively replacing human living labor in the production of material wealth by scientific knowledge and machines, Marx argues that capitalism progressively converts an ever larger quantity of necessary labor time into what he calls “disposable labor time”, “not-labor time” or “free time” for a small stratum of exploiters.

While free time for the few exists in all earlier societies with an exploiting class or classes, in the capitalist mode of production the immediate aim of production is the appropriation of an ever larger mass of surplus labor time. The capitalist makes a profit by progressively (and aggressively) reducing employment of living labor in the production.

At the same time, the reduction of living labor in production of shoes, houses, etc. is not pursued by the capitalist so that society can be freed from necessary labor time, but in order to increase surplus (unpaid) labor time.

It is important to tease out what this means for communism. The epoch of capitalism is characterized by the progressive reduction of necessary labor in order to increase surplus labor time. Thus they have to reduce necessary labor time in such a way that surplus labor time is increased.

Pimping ain’t easy. And being a capitalist ain’t easy either. As Marx explains, converting necessary labor time into surplus labor time gets pretty chaotic at times and increasingly so. If capital  succeeds too well at reducing necessary labor, then it suffers from overproduction. Production is interrupted, because no surplus labour can be realized by capital.

How chaotic can this system of production get? Earlier we saw that Marx predicted that production based on exchange value would collapse — that’s how chaotic it can get. Eventually the periodic crises where production for profit is interrupted because surplus value can’t be realized becomes a permanent state of the mode of production.

3. The creation of disposable labor time and the collapse of the gold standard

The argument Marx makes in the two paragraphs is interesting, but am I reading more into Marx’s argument than he is actually asserting? I think this can only be determined by focusing on a key category Marx employs in his discussion: “Production based on exchange value”.

What does Marx mean by this phrase? In Marx’s theory “exchange value” is well defined at the beginning of Capital, volume one. Exchange value is the expression of the value of a commodity stated in terms of its exchange ratio with another commodity.

The value of a commodity is the socially necessary labor time required to produce it; while the exchange value of a commodity is the socially necessary labor time it takes to produce a commodity stated in terms of the material of another commodity.

Thus, for example, the exchange value of labor power is stated in terms of the gold paid for it in the market. If one day’s labor power can be purchased for two ounces of gold, this means that the value of one day’s labor power is equal to the socially necessary labor time required to produce two ounces of gold.

The empirical problem with demonstrating this, of course, is that no one knows how much socially necessary labor time it takes to produce anything — gold, labor power, widgets, crack cocaine, anything. But let’s ignore that for the moment. The important thing about what I said above is that Marx argues this relation between the value of a commodity and its exchange ratio with other commodities eventually would break down or collapse within the capitalist mode of production. At some point in capital’s evolution, the exchange ratio between labor power and gold would no longer reflect their comparative socially necessary labor times.

Another way to say this is that at some point the price of labor power in gold (i.e., wages) would no longer reflect the value of labor power. The prices of all commodities including labor power would no longer express their labor values. This would occur because production of material wealth (shoes, houses) would reflect the application of science and technology more than it did human labor.

Thus, Marx predicted the end of production based on money was inevitable. The publication of the Grundrisse thus throws light on the forces that ultimately led to the collapse of Bretton Woods money system in 1971.

4. Relative versus absolute overabundance of labor power and capital

According to Marx the creation of profit is accomplished by converting necessary labor time into surplus labor time. Capital relies on a relative overabundance of both capital and labor power relative to the immediate needs of society that can be devoted to the production of surplus value. Surplus value, says Marx, requires that,

“a large part of the wealth already created can be withdrawn both from immediate consumption and from production for immediate consumption, in order to employ this part for labour which is not immediately productive within the material production process itself.”

Capital thus creates profits by creating a relative overabundance of workers and capital that can be employed producing surplus value. Marx defines relative overabundance of labor power and capital this way:

“As the magnitude of relative surplus labour depends on the productivity of necessary labour, so does the magnitude of labour time – living as well as objectified – employed on the production of fixed capital depend on the productivity of the labour time spent in the direct production of products. Surplus population (from this standpoint), as well as surplus production, is a condition for this. That is, the output of the time employed in direct production must be larger, relatively, than is directly required for the reproduction of the capital employed in these branches of industry.”

Marx’s argument here is critical, since it implies that when the profit rate falls permanently to zero, the superfluous population of workers and the superfluous mass of capital created in the course of material production is no longer relatively overabundant, but absolutely overabundant.

Capital relies on relative overabundance of capital and labor to create surplus value. When the surplus value can no longer be realized as profit, this suggests the overabundance is no longer relative in comparison to the immediate consumption of society, but absolutely overabundant, absolutely unnecessary to the production of material wealth.

Of course, it remains to be shown that the events of the 20th century are related to final collapse of the profit rate to zero as I am arguing here, but if it was, it would imply that the process by which surplus value is created is now stymied by the absolute overabundance of both labor power and capital.

5. Absolute overabundance of labor power and capital

So, at the point where production based on exchange value breaks down — i.e., at the point where the gold standard collapses — too much surplus value is being created by the capitalist mode of production. At the point where production based on exchange value breaks down, how much surplus value is too much? All of it. Every single jot of surplus value is too much.

Which is to say, it is likely that every single jot of surplus value created after 1971 is too much for capital to realize.

What happens when capital finally produces too much surplus value to realize and production based on exchange value breaks down? Marx has a surprisingly comprehensive list of events scattered throughout his writings:

  • First, the rate of profit falls to zero, or even becomes negative.
  • Second, the total mass of productively employed capital no longer grows and even begins to shrink. Newly created capital can only be put to work productively, if a mass of existing capital equal to or greater than it in magnitude is withdrawn.
  • Third, existing capitals would be drawn into a competitive conflict to decide which would be employed productively and which would be forced to stand idle. This would include world wars between national capitals.
  • Fourth, capitals begin to kill each other off and property is concentrated in the hands of ever fewer and bigger capitals. Monopoly continues to the point where it is no longer compatible with social production itself. The capitalist are expropriated — if not at first by the workers themselves, then by the existing state.

To summarize Marx’s argument, then, eventually the profit rate goes to zero or even negative. There follows a global conflict among capitalists leading to the wholesale depreciation and outright destruction of capitals. The state is forced to step in and take control of the economy and the capitalists are rendered superfluous to production.

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Does any of this ring a bell to anyone? Does it look like what we passed though roughly between 1914 and 1971? Surprisingly, there is an entire cottage industry among “Marxist academics” who argue the fragment was an abortive attempt by Marx, which he ultimately abandoned.

I will look at several of these efforts next.

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