First Published: 1887
Source: The National Reformer, August 21st 1887
Transcription: Steve Palmer
Copyleft: Internet Archive(marxists.org) 2009. Permission is granted to copy and/or distribute this document under the terms of the Creative Commons License.
Undisturbed by any suspicion of the slip in the analysis by which he laid bar; as he thought, the true value form of wares, Marx proceeds to a minute and apparently exhaustive analysis of simple circulation, and of the functions of money, which he regards asthe material form of exchange value. Some of the assertions which occur in these analyses would make a banker gasp if he took them, as he well might at a casual dip into the book, for statements of fact, unconditioned by the stage of the inquiry at which they are made, or by the normal economic hypothesis as to equal opportunity, fertility, etc., which Marx seems to take for granted, as henowhere explicitly expostulates them. As the inquiry proceeds, the statements are modified by the new considerations successively introduced; so that it is possible to quote sentences from different pages, apparently flatly contradicting one another, and yet both accurate relatively to the conditions assumed.
Throughout the chapters on money, the reader is conscious that the distinction between use value (corresponding to Jevons's total utility) and exchange value (final utility) is being seduously forced upon his attention. They arenot merely distinguished, but almost violently exhibited as antagonistic, likened to two opposite poles of a magnet, and forced asunder in his conception by every available rhetorical or dialectical artifice. In this Marx is leading up to his cardinal fact that the proletarian workman, individualist appropriation of the land having deprived him of the raw material without which his labour power is useless to him,has to live by selling that labour power as a ware in the market. Now in purchasing a ware in the market, you practically buy its use value for its exchange value-its total utility for its final utility. In the instance given here last week of an article with ause value or total utility expressed by £3 3s., we saw that additional quantities were thrown on the market until the price fell to £1,. the cost of production ; and that this became the normal price. A total utility of £3 3s.was thus sold for £1 ; or, as Marx might have put it, if he had not missed the secret of the expression of use value by money, a use value of £3 3s. sold for an exchange value of £1. Now when the workman sells his labour power for wages in the market, he does this very thing, sells its total benefit for the mere cost of producing it-its use value for its exchange value. But, according to the Marxian theory, the value of a man's labour power is the abstract human labour embodied in the victual that has created and nourished it. Thus if the labour necessary to produce a day's victual be six hours, that will be the value of a day's labour power. But a day's labour power may be exerted during twelve hours. In that case the labourer in the first six hours of the day will replace the value of six hours' labour embodied in his victual. In the remaining six hours he produces as much value again; and this, which Marx calls surplus value, goes to the purchaser of the labour power. In other words, the exercise of twelve hours' labour power appears as the consumption of six hours' labour power. Therefore, you can go into a market wherein labour power is for sale, with gold that took six hours' labour to make; buy with it as much labour force as took six hours to make; vicariously exercise that purchased labour power during twelve hours, and return to the market with the product, which, because it embodies twelve hours' labour, you can exchange for twelve hours' worth of gold. Thus you have doubled your gold by simply buying in the morning for £1 and selling in the evening for £2. To this a physiocrat would have answered that if Dick can exploit Tom in that fashion, Tom is equally free to exploit Dick; and the net result must he that, though Tom gets six hours surplus labour out of Dick, Dick can get the same out of Tom, and both will be equally well off at the end of the day; so that whilst there is surplus value, it is not misappropriated. But if Dick is a proprietor, and Tom a proletarian, which is what Marx means, then Dick is under no obligation to sell his labour power at all, since he can produce with it for himself out of the land and raw material contained in his property, whilst Tom, the propertyless, must either sell his labour power or starve. Further, Tom must sell it either to Dick or to some other proprietor: he cannot sell it to a fellow proletarian, to whom it would be useless for the same reason (lack of material ) that it is useless to himself.
Now though the process here described is at the first blush remarkably like what is actually taking place, Marx's theory of it will nor bear examination any better than his analysis of wares did. In the firstplace, the proprietor's monopoly completely upsets those conditions as to equal opportunity, etc-, on which alone it is true that "commodities in which equal quantities of labour are embodied, or which can be produced in the same time, have the same value". The commodity which the proprietor offers is not gold or any other ware it is access to the material of production, a privilege which costs the proprietor no labour, and is yet of practically infinite utility tothe proletarian, since it is a matter of life or death to him. Again, the commodity, labour-power, which the proletarian offers to the proprietor, differs from ordinary wares in one respect, the immense importance of which will appear if the bargain between proprietor and proletarian be followed carefully. The proletarian says, in effect, to the proprietor, "I have to sell to you my labour-force, which will enable you to produce without consuming-to live without working. I want in exchange access to the land, which will enable me to live byworking." Evidently the proletarian is at a disadvantage; for the proprietor's commodity, life itself, is of far greater utility than the proletarian's, which is only idleness-i dleness for the proprietor at the cost of toil for himself. Therefore the proletarian loses by the exchange, and would, if the commodities in question were of the usual kind, direct his labour in future to the production of fresh land instead of fresh labour-power. But the first course is impossible, since the labourer is not Jehovah. All he can do, then, is to abstain from producing fresh labour-power and so cheapening it by increasing the supply. But now he is baffled by the factthat unskilled labour-power differs from all other commodities in that its production, instead ofbeing an effort or a sacrifice, is a pleasurable act to which man isdriven by an irresistible instinct. Therefore fresh supplies of unskilled labour-force pour into the market; and the successive increments are less and less desired by the proprietary class, as, when they have added luxury to its idleness, they can only add satiety to its luxury, whilst its property remains as necessary to the workers as ever. The price of labour-force falls thus until it reaches subsistence wage, then starvation wage, and finally zero: the proprietors wanting no more of it, and the proletariat yet driven by their animal instinct to continue producing it. At this point we have the unemployed, and the value of unskilled labour-force down to nothing. Naturally, the proprietors take as much as they want for nothing, keeping it alive in such condition as they require it by feeding it with a portion of its own produce. They may even turn it, at its own cost, into skilled labour-force in such quantities as they desire; and, though the first few educated will avail themselves of free contract to obtain a price for the exceptional utility of their services, continuation of the education process will bring down the value of skilled labour-force to zero also. So that finally, by the operation of population increase and Individualism, the proprietors attain as much labour-force, skilled and unskilled, as they desire, absolutely for nothing: the workers not only maintaining one another at the various standards of comfort required by their different specific utilities (the doctor, for instance, needing for the purposes of the proprietors more expensive habits and education than the shepherd), but, as policemen, soldiers, sheriffs, etc., preventing one another from waxing fat and kicking.
Here again, though Marx missed the theory, he did not miss the facts. No one could show more forcibly how wage so effectually reached a bare subsistence for labour, that a danger arose of its going beyond that, and thelaw had to interfere to prevent the individual labourers being used up faster, instead of exactly as fast, as they could be replaced. Further, he is not only aware that the unemployed are always with us: he actually forces them strenuously on our attention as a reserve army of industry which guarantees the employer against scarcity of labour power at sudden revivals of trade. He seems even to see that the unemployed are unemployed because their labour has no utility, and that havingno utility it can have no exchange value; but fie does not see that, by what is sometimes called "the law of indifference", it is impossible for one part of the stock of a commodity available a t an y given time to have value whilst another part has none, since no man will give a price for that which he can obtain for nothing. This second oversight of his is the more remarkable, as it puts the condition of the proletariat in a light much more terrible than does his assumption that the subsistence wage is the value of the labour force, a view as untenable even on Marxian principles as thatthe manufacturer's coal bill and water rate are the value of his steam power. I can imagine a Marxite, on the spur ofthe moment, pointing out here that the labour socially necessary to produce a clay's victual or a day's coals can be separated from that necessary to produce a labourer or steam engine; but both must enter into the value of the power they produce; and Marx himself carefully proves in the case of the steam engine that it transmits to the product not only the value of its fuel food, but of itself. But when he attempts, as he does, to differentiate labour power from steam power, the man from the engine, his logic breaks down. He is as usual quite right as to the fact that labour power differs from steam power and other commodities; but he mistakes the difference. As we have seen, the momentous peculiarity of labour power is that, unlike all other marketable commodities, its supply is not checked when no more is wanted: it will be produced even when the producers are losing desperately by it, Marx's unsound analysis of wares and consequent error as to valueblinded him to this; and he tried to account for the peculiarity of labour power by other differences which either do not really exist, or, like the specific differences in labour or in utilities, have no economic significance. Thus he pointed out that six hours' labour will prime a man to work twelve hours. But the same thing is true of asteam engine, from which he insists that no surplus labour, and consequently no surplus value, can be got. He cannot escape the parallel by saying that steam power is riot human power; for that difference is one of the specific differences in the method of applying energy which he expressly abstracted in his analysis of wares; and, besides, he states directly in his first chapter that "productive activity, if we leave out of sight its special form, is nothing but the expenditure of human labour power". Unless, by insisting on the ordinary interpretation of this statement, wedismiss it as false on the face of it, we must take it to mean that steam power is only a special form of human labour power: therefore "surplus" steam power, which, taking the word "surplus" in Marx's sense, is the hardest of hard facts, is surplus human labour power, and consequently produces surplus value. Yet Marx's whole theory of the origin of surplus value depends on the accuracy of his demonstration that steam power, machinery, etc., cannot possibly produce surplus value. If Marx were right, then a capital of £10,000, invested in a business requiring £9,000 for machinery and plant, and £1,000 for wages (or human labour power) would only return one ninth of the surplus value returned by an equal capital of which £1,000 was in the form of plant, and . £9,000 in wage capital. As a matter of fact the "surplus value" from both is found to be equal. At this difficulty Mr. Frederick Engels is nothing abashed. He glories in it, and challenges all and sundry to solve it before he, by publishing the third hook, reconciles that and many other irreconcilables. But his challenge only concerns the Marxites themselves; for the difficulty is created by the surplus value theory, and does not exist for those who have not adopted that theory. To them, the very name "surplus value" is a contradiction in terms; and to those of them who are Socialists the implication that what takes place between the proprietors and the proletariat is an exchange of wares,is specially objectionable. The third book may reconcile the contradiction; but it will do so by practically recanting the errors of the first. This is said with the greater confidence because, even in this first book, Marx, as he goes on, leaves his own theorising far behind.
I must now leave the subject with a confession that I never took up a book that proved better worth reading than "Capital". It is unavoidable that the merits of the book should occupy a relatively insignificant space here; whilst, on the contrary, its errors occupy a relatively insignificant space in the book. In pointing out these errors, and so implying that Marx was fallible, I have incurred the risk of being accused, as I once was by an enthusiastic Marxite at a public meeting, of attempting to pooh-pooh Marx as an idiot. Undoubtedly I have taken a course somewhere between that and worshipping him as a God. To me it seems that his errors arose from several causes. He was a born materialist; and when lie attempted to carve a theory with the tools of the born metaphysician, he cut his fingers. In his time, too, the germ of the truth about value lay in the old supply and demand theory, which was historically anti-popular, whereas the labour theory of Ricardo had a delusive air of being the reverse. Again, the question of the value of labour force was inseparable from the population question; and that, too, he disliked as a recognized staple of capitalist apologetics. This was prejudiced, doubtless; and it cost him the coveted secret of value; but he knew the condition of the people; and his sympathies were too wide and his imagination too active to permit him to investigate economic subjects in the purely scientific spirit of Jevons. He would have been more or less than human if he could have written the history of capital with academic coolness. The Marxites who cannot bear to admit that a person named Jevons was right where Marx was wrong, may console themselves with the reflection that a person named Young was right where Newton was wrong, and that Newton's reputation stands nevertheless.
I am strongly tempted to launch into a description of the extraordinary picture of modern industrialism which gives the book its main force and fascination; but I have already abused the indulgence of the editors beyond all reason in the matter of space. My last word for the present is-Read Jevons and the rest for your economics; and read Marx for thehistory of their working in the past, and the conditions of their application in the present. And never mind the metaphysics.
G. Bernard Shaw
 This fact is of interest to students of Adam Smith-The radical mistake made by him was his assumption that men are insatiable, from which it would follow that a man with a million servants would be as anxious to have a million-and first as a man with only one servant is to have a second. If that were so, then poverty could never appear until the population began to overtax the fertility of the earth. But it is not so; and by failing to see that, Adam Smith missed the solution of the labor problem.
 it should be borne in mind here that a bare subsistence for the labor required to satisfy the proprietors (the true wage fund of individualism) does not mean sufficient subsistence to enable cad.) individual laborer 10 live out hit natural term of life, Dr. Drysdale has estimated the lifetime of a Lambeth wage-worker at 29 years, and that of a gentleman of means at 55. But if the labor power of the wage-worker used up at 29 can be replaced by that of a fresh laborers labor has had its subsistence wage, though the individual laborer has been starved.