Introduction

Alan Woods

Following the great success of the first volume of the Classics of Marxism, a second volume is now published containing five more important titles: Marx’s pioneering works on economics, Wage Labour and Capital and Value, Price and Profit; Lenin’s Left-Wing Communism: An Infantile Disorder and In Defence of October and Stalinism and Bolshevism by Trotsky.

Broadly speaking, Marxism can be split into three distinct yet interconnected parts – what Lenin called the three sources and three component parts of Marxism. These generally go under the headings of Marxist economics, dialectical materialism and historical materialism. Each of these stands in a dialectical relation to the others and they cannot be understood in isolation from one another.

The present work opens with two of Karl Marx’s best-known works on economics. Wage Labour and Capital is based on lectures delivered by Marx at the German Workingmen’s Club of Brussels in 1847, that is, before the Communist Manifesto and at a time when Marx had not yet fully developed his theories of political economy. Engels later explained that if Marx had had the opportunity to have revised this text he “would unquestionably have brought the old work, dating from 1849, into harmony with his new point of view.”

Engels nevertheless decided to publish it unchanged – with one important exception. When he gave these lectures, Marx said that what the worker “sold” to the capitalist was his or her labour (that was the accepted theory of the time as put forward by classical bourgeois economists like Ricardo). But in reality what the worker sells is not labour, but labour-power, as Marx explains in Capital and Engels points out in his introduction to Wage Labour and Capital:

“My alterations centre about one point. According to the original reading, the worker sells his labour for wages, which he receives from the capitalist; according to the present text, he sells his labour-power. And for this change, I must render an explanation: to the workers, in order that they may understand that we are not quibbling or word-juggling, but are dealing here with one of the most important points in the whole range of political economy; to the bourgeois, in order that they may convince themselves how greatly the uneducated workers, who can be easily made to grasp the most difficult economic analyses, excel our supercilious “cultured” folk, for whom such ticklish problems remain insoluble their whole life long.

“Classical political economy borrowed from the industrial practice the current notion of the manufacturer that he buys and pays for the labour of his employees. This conception had been quite serviceable for the business purposes of the manufacturer, his book-keeping and price calculation. But naively carried over into political economy, it there produced truly wonderful errors and confusions.”

Although it is an early work, Wage Labour and Capital contains the outline of the Labour Theory of Value and many important insights into the workings of the capitalist system and the way in which workers are exploited. It is well worth reading. Value, Price and Profit, however, was produced at a time when the labour theory of value had already matured in Marx’s brain. It was first delivered as a speech delivered by Marx to the International Working Men’s Association (The First International) in June 1865, while he was working on the first volume of Capital that was published two years later. Marx writes in Capital:

“In order to be able to extract value from the consumption of a commodity, our friend Money Bags must be so lucky as to find in the market a commodity whose use-value possesses the peculiar property of being a source of value, and consequently a creation of value. This special commodity is labour-power and other as seller of the commodity labour-power. This is the difference between wage labour and other forms of exploitation. In slavery it appears as if the owner of the slave gets the entire value of the labour of the slave (of course this is not so). Under serfdom, the relation between serfs and lords, and the division of labour of the serfs, was clear.” (Capital Volume I, Chapter 6)

When the worker accepts employment he or she arrives at a “voluntary” contract whereby the worker advances the use-value of labour-power to the capitalist. The workers give their labour-power to the capitalists, but only receive payment after it is used, in the form of a monthly or weekly salary. Thus, the workers extend free credit to the bosses. Moreover, the value of labour-power (wages) has nothing to do with the real value of labour. Once the worker has agreed to sell labour-power, the boss can use it for as long as he wants.

The value of labour-power is determined by the labour-time necessary for production and reproduction of the labourer. It is the value of the means of subsistence necessary for the maintenance of the labourer in his normal state. The value of labour-power, however, differs from that of other commodities insofar as it has a moral and historical element. As Marx explains:

“It is the product of historical development and depends therefore, to a great extent, on the degree of civilisation of a country.” (Ibid)

What was an acceptable level of sustenance to a worker in Victorian England is not the same as what it is today. What may be an acceptable level of sustenance to an agricultural labourer in India today will not be for a farm worker in the USA. However, in a given country, in a given period, at different times, the average quantity of the means of subsistence necessary for the labourer, in practice, is known.

Through the consumption of labour-power the capitalists produce commodities, but also surplus value, which is nothing more than the unpaid labour of the working class. The aim of the capitalist is to produce the maximum surplus value from the labour-power of the workers. This he achieves by a number of means: lengthening the working day, intensifying the labour process, productivity incentives, etc.

The process of the extraction of surplus value takes place in the field of production – within the four walls of the workplace. The value of labour-power (wages) is what the worker receives, but the product of the workers’ labour is the property of the capitalist, not the worker. However, in order to convert the commodities produced by the workers into actual profit, the capitalist must find a market for them. New contradictions arise as soon as the commodity leaves the factory and enters the anarchy of the market. The greed of the capitalists for surplus value knows no limits. But the power of capitalist society to absorb the mass of commodities produced is limited by the poverty of the masses. Moreover, the individual capitalist has to compete with many other capitalists for a share of the market. In the end the inevitable result is periodic crises of overproduction.

The class struggle under capitalism is the struggle for the division of the surplus value created by the labour of the working class. As long as the capitalists are extracting surplus value in sufficient quantities, they can buy social peace. But that is not the case now. The present crisis has an unprecedented character. Even the most modest demands of the workers are met with stubborn resistance. This is a finished recipe for an intensification of the class struggle. Sooner or later the workers will come to understand that the only solution is a complete transformation of society – a revolution.

Until recently the accepted wisdom was that the market, if left to itself, was capable of solving all the problems. According to the bourgeois economists, crises of overproduction were not supposed to happen. The university professors were convinced that the free market forces of supply and demand would automatically arrive at equilibrium (the “efficient market hypothesis”). The bourgeois economists never tire of repeating that Marx’s economic theories were outdated “ideas of the 19th century”. But the economic collapse of 2008 completely demolished the smug assertions of the alleged superiority of market economics. Nothing that has happened since then gives us any reason to doubt it. As I write these lines China, which was one of the main motor forces of the world economy, is facing a serious crisis of overproduction that can very easily turn into a deep slump that will drag down the whole world.

For further reading on economics, go to the first volume of Capital. My friend and comrade Ted Grant used to say that you could then go straight to Volume III. I would also recommend The Living Thoughts of Karl Marx, a condensed version of Capital Volume I with a brilliant introduction by Trotsky (an extract of which is available in the economics section of Wellred Books’ What Is Marxism?). Normally I would not recommend selections, but the Penguin Marx on Economics is very well done. We hope that by reading these works, the reader will be encouraged to study Marx’s writings themselves. After all, nobody has ever expounded Marx’s ideas better than Marx himself.