Ninteenth note on Moseley’s “Money and Totality”

by Jehu

In the previous note I offer this scenario:

Assume two capitals, one of which buys labor power to produce shoes and a second capital that employs no labor power in the production of shoes.

The first capital, “A”, pays out four hours for labor power and sets this labor power to work for eight hours. At the end of eight hours, one pair of shoes has been produced.

The second capital, “B”, however, pays nothing for labor power. The capitalist sets his machines to work for eight hours, while he goes fishing, hunting and criticizing. At the end of eight hours, he returns to his workshop to find one pair of shoes has been produced by his machine.

Based on the above information:

  1. What is the value of each of the pairs of shoes?
  2. What is the value of the labor powers employed in the production of the shoes?
  3. What is the surplus value created by the labor power?

There are two approaches to answering these question. The first would initially address each of the questions for the particular capital concerned. Using this approach we get this result for “A”:

  1. 8 hours of value for the shoes
  2. 4 hours of value for the labor power
  3. 4 hours of surplus value created in the production of the pair of shoes

For capital “B”, we get this result:

  1. 0 hours of value for the shoes
  2. 0 hours of value for the labor power
  3. 0 hours of surplus value created in the production of the shoes

In other words, capital “A”, employing four hours of labor power, would at first appear to produce a pair of shoes with a market price of 8 hours of value and four hours of surplus value.

On the other hand, capital “B”, employing no labor power at all, would produce a pair of shoes with a market price of zero and no surplus value. Whatever cost involved in the shoes would solely be the cost of the constant capital used up in the production of the shoes.

To explain the formation of capitalistic prices of production in the shoes industry, some might argue that they are formed through competition between capitals, while others might suggest they are formed by the movement of capital. Still others employ all sort of fancy math to dazzle us with their brilliance.

To understand the logic of Marx’s approach, however, let’s assume there are not two but only one capital in our original example. In place of capitals “A” and “B”, we have only a single composite capital. This composite capital has introduced new methods of production so that it can double the number of pairs of shoes produced in eight hours. This means that for a given eight hours of labor, the capital can produced two pairs of shoes.

The answer then becomes simplified:

  1. 8 hours of value for two pairs of shoes, or 4 hours of value embodied in each pair of shoes
  2. 4 hours of value for the labor power consumed in production, or about two hours of labor power per pair
  3. 4 hours of surplus value created in the production of the shoes, or about two hours of surplus value per pair

If we treat the labor powers as if they were a single homogenous labor power, how the prices of production of capitalistically produced commodities form becomes a great deal easier to grasp. The value of each pair of shoes is equal to four hours socially necessary labor time. The labor power employed in the production of the two pairs of shoes is four hours of socially necessary labor time. The surplus value produced by the labor power is four hours.

If we now break out how this value is divided between capital “A” and capital “B”, we get this result for capital “A”:

  1. 4 hours of value for the pair of shoes
  2. 4 hours of value for the labor power
  3. 4 hours of surplus value created in the production of the shoe
  4. 0 hours of surplus value realized in exchange

For capital “B”, we get this result:

  1. 4 hours of value for the pair of shoes
  2. 0 hours of value for the labor power
  3. 0 hours of surplus value created in the production of the shoes
  4. 4 hours of surplus value realized in exchange

Contrary to what we might expect for a system of commodity production, it is precisely the capital that produces no value at all that realizes a profit. While the capital that produces all of the surplus value in this example finds, after accounting for the value of the labor power consumed in the production of its commodity, that it realizes no profit.

Have I missed something here?

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