From Das Capital
to DOS Capital: A Look at Recent Theories of Value
(page 1 of 3)
By Jerry Harris, Chicago/Third Wave Study Group
number of schools of thought have recently developed
which place society in a new age. One common thread
is the current mania for "post" isms, i.e.,
post-industrialist, post-modernist, post-structuralist,
post-Fordist, even Peter Drucker's post-capitalist.
But these only say what the emerging society isn't,
not what it is. It's as if the last two hundred years
had been labeled post-feudalism, rather than industrial
what the new schools all recognize is that a revolutionary
transformation has taken place. What has yet to be determined
is whether society is still in a capitalist stage of
development, or whether it has entered an era for which
we have no proper descriptive name.
is crucial in naming a society? For Marx, identifying
the economic base was key to understanding the stage
of development. Central to his theory of history was
his analysis which uncovered capitalism's laws of motion,
and how they were qualitatively different from feudal
and ancient society. This analysis hinged on his theory
of value and accumulation.
and Heidi Toffler's historic perspective is very similar
to Marx's. Their three waves theory also keys in on
the economic base as the most fundamental way to identify
human development and different historic eras. For the
Tofflers, agrarian society, industrial society, and
today's information society are the three waves of civilization.
both Marx and the Tofflers, when the economic base changes,
so does the rest of society. The key to this transformation
is how wealth is created. If today is a historic period
of revolutionary change then a new theory of value,
labor and accumulation is needed. This article will
review how Marx treated this question, and then discuss
fundamental shifts in the third wave economy.
Theory of Value
Marx, a key difference between feudal-agrarian and industrial
production was the commodification of labor and products.
Agrarian labor mainly consumed what it produced, and
bartered for what it needed. Markets, usually in the
form of the medieval fair, were a secondary adjunct
to the local economy. They were not driven by competition,
but a simpler mode of exchange which sought to buy low
and sell high. Marx summed-up agrarian commercial exchange
as Money for Commodities in exchange for greater Money,
or M -> C -> M1. Small merchant production was
explained as Commodities in exchange for Money, for
which you could purchase greater amounts of Commodities,
or C -> M -> C1.
these formulas changed qualitatively with industrial
capitalism. Marx explained it as the following:
-> C -> (mp) -> P -> C1 -> M1.
is, Money in exchange for a Commodity to which is added
the means of production and labor power transforms the
Commodity through Production into a New Commodity with
greater value than the first, which then is sold for
capitalism places money as both the initiator and goal
of production. The commodity and its use are no longer
the purpose of production. As Marx explained this transformation:
"The development of commerce and commercial capital
brings about everywhere an orientation of production
towards exchange values, increases its volume, multiplies
and universalizes it, develops money into world money.
Commerce therefore has everywhere a dissolving influence
on the existing organization of production which, in
all its different forms, is primarily oriented towards
use value." (Capital III, VA III/pp. 362 4)
Tofflers also pay close attention to this difference
between agrarian and industrial society. They explain
it as a split between producer and consumer. In agrarian
society the producer mainly consumed his or her own
product, so production was based on use value. But industrial
society splits this relationship, making everyone dependent
on the market to fill their needs. A fundamental shift
occurs whereby society becomes organized around exchange
value. Everything is for sale, including labor itself.
focus on profit takes place within a competitive market.
Competition for greater and greater market share drives
the system to accumulate and expand. But unrestricted
expansion also leads to destruction. Here lay its core
contradiction, and the duality of the system.
competitive drive causes capitalism to seek new markets,
develop new products, and create new technologies, which
lower costs and speed production. Technology plays a
key role in creating surplus value. Greater profits
are not generated simply by lowering wages, but more
importantly through the higher productivity of advanced
technology. This is the basis for the tremendous creative
impulse inherent in the system.
Marx maintained that value is created only through human
labor. The addition of labor, whether intellectual or
physical, applied to the original commodity in the process
of production, is what makes it possible for the capitalist
to sell the new product for more money. Therefore the
capitalist must always strive to lower the cost of labor
through economic, social and technological means to
increase his profits. The greater his accumulation of
capital the better he is able to compete. Therefore
labor can never possess everything it produces because
that undermines profit maximization. What follows is
the crisis of overproduction, factory closures, unemployment,
and all the social ills that are familiar. In effect,
this is the destructive side of capitalism.
contradiction forms specific social property relations
and a mode of exploitation in which workers are reduced
to commodities, bought and sold on the labor market.
The labor power bought by the capitalist has no value
unless applied to the means of production, which is
also the property of the capitalist. This social form
of production trapped inside private property ownership
is the basis for the alienation and exploitation of
labor. Therefore the true potential of the productive
system can only be liberated when labor is freed from
the domination of capital, and the full creative force
of production is no longer hindered by capital's need
for accumulation. If labor received the value of what
it creates, poverty would be eliminated.
what if the worker is eliminated from production? The
capitalists, who are always at the cutting edge of economic
change, have begun to consider this question. The cover
of Fortune magazine in October 1994 declared: "Your
company's most valuable asset, Intellectual Capital,
new ways to build it and measure it." More