into capitalism occurred because of a transformation in the
understanding of exchange-value
and of labor. In a barter society, goods are exchanged in a way that
directly relates one item to another by consideration of the "specific
useful and concrete labour" used to produce the object (Marx, Capital
objects exchanged are tied closely both to the use-value
of the objects (their immediate usefulness) and to the real, material
labor expended to produce the object. In capitalism, that concrete labor
tends to get translated into an abstract quantity that can then stand
as an equivalent-form
that one can use to determine the exchangeability of all sorts of products.
In this way, "concrete labour... becomes the expression of abstract
human labor" (150).
The differences between different kinds of labor and different sorts
no longer matter: one begins to think of labor as an abstract, undifferentiated
quantity that one can exchange for analogous abstract quantities of
labor "congealed" in other products: the labor that creates
value "is now explicitly presented as labour which counts as the
equal of every other sort of human labour, whatever natural form it
may possess, hence whether it is objectified in a coat, in corn, in
iron, or in gold" (155).
As Marx goes on, "The linen, by virtue of the form of value, no
longer stands in a social relation with merely one other kind of commodity,
but with the whole world of commodities as well" (155).
We thus begin to move towards a "universal equivalent": a
single abstract measure by which one can facilitate the exchange of
categorically different items on the market. A similar transformation
occurs in the value of the given product. In the exchange of goods on
the capitalist market, exchange-value
rather than use-value
dominates. As Marx explains, exchange-value
must always be distinguished from use-value,
because "the exchange relation of commodities
is characterized precisely by its abstraction from their use-values"
(127). By abstracting value into exchange-value,
the stage is set for the eventual dominance of first gold and then paper
money as the universal equivalent of capitalist society.
By accepting money
as the universal equivalent, capitalism eventually manages to exploit
the laborer upon whom all value ultimately inheres, according to Marx.
That is, money
tends to hide the real equivalent behind any monetary exchange: labor.
The more labor it takes to produce a product, the greater its value.
Marx therefore concludes that "As exchange-values,
are merely definite quantities of congealed labour-time" (130).
However, what happens in a capitalist society is that people tend to
believe that power and value really inhere in the money-form
rather in the labor that actually produces goods and services, leading
to what Marx terms "commodity fetishism." (See the
next module on fetishism.)
in turn allows for the accumulation of capital.
exchange, one exchanges a commodity
for money, which
one then exchanges for some other commodity.
One sells in order to buy something else of use to the consumer; Marx
writes this formula as C-M-C (or Commodity-Money-Commodity). Money
allows this formula to be transformed, however: now one can buy in order
to sell (at a higher price) or M-C-M, which becomes for Marx the general
formula for capital. In this second formula, "the circulation of
money as capital
is an end in itself, for the valorization of value takes place only
within this constantly renewed movement. The movement of capital
is therefore limitless" (253).
The aim of the capitalist thus becomes "the unceasing movement
of profit-making" (254). Indeed, the formula is reduced even further
in the case of usury, when one loans money in return for the same money
with interest, or M-M. A similar process occurs on the stock market:
money making yet more money without the purchase of a tangible commodity.
Once again, what is forgotten in this process
is the labor-power
upon which the whole system of profit relies: the purchasing of a person's
in exchange for full ownership of the product thus produced. The product
is in turn sold on the market at a profit that is controlled exclusively
by the capitalist (M-C-M).