Karl Marx

by Achille Loria

The "labour note" system cannot rationally be instituted until production has been socialised, or until the state shall impose upon each individual the production of a specified quantity and quality of commodities, correlatively imposing upon the consumer the obligation to acquire these. In such conditions, however, we could no longer speak of commodities or of exchange, for these phenomena belong exclusively to an individualistic economy and would have no place in a socialised economy. This means that the reform of exchange by the suppression of profit can only be effected by the suppression of exchange itself, by the institution of the co-operative commonwealth. Indeed, Robert Owen, who proposed the "labour note" system in 1832, and was the most brilliant of its advocates, clearly recognised this difficulty, and understood that the socialisation of production would be an indispensable preliminary to the adoption of the plan. It was the impatience of his disciples which forced him to inaugurate the system within the framework of the capitalist economy by founding the National Equitable Labour Exchange. The logic of facts gave a patent demonstration of the irrationality of the attempt; and Owen, saddened and humiliated, was compelled to witness the failure of the new institution.

It will readily be understood that these abstruse and abstract investigations, devoid as they are of any tangible connection with the burning problems of property, were not likely to arouse interest among the members of the party. Nothing could be more natural than the tone of hopeless discouragement with which the volume was greeted even by the author's most devoted friends. Liebknecht, for example, declared that he had never before experienced so great a disappointment. Biskamp enquired what on earth it was all about; Burgers deplored that Marx should have published a work so dull and fragmentary. It is true that the book had a moderate sale; Rau quoted it in his treatise; certain Russian and American economists made it the subject of profound studies. Nevertheless, the publisher refused to proceed with the issue.

Hardly had this literary bickering come to an end when Marx became involved in a violent quarrel with the distinguished naturalist Karl Vogt, who publicly charged him with setting snares for the German exiles and with having sordid relationships with the police. Marx replied with a savage booklet entitled Herr Vogt (London, 1860). The style of this polemic writing is intolerably vulgar; but in other respects the book is noteworthy, for it contains interesting revelations anent the Italian campaign and the relationships between Turin and the Tuileries. We must remember, moreover, that the accusation here launched against Vogt, that he was in the pay of the Second Empire, was subsequently confirmed beyond dispute, for in 1871 among the ruins of the Tuileries there was found a receipt for frs. 40,000 which had been paid over to Vogt.

But scientific failures, personal contests, persistent and distressing domestic discomforts, seemed to inspire our athlete with renewed strength for the continuance of the work he had begun. Nevertheless, profiting by experience, he decided upon a yet further modification in the plan of his book, resolving to defer to its final section all historico-critical disquisitions, and to concentrate his energies upon the positive analysis of concrete reality. Further, being prevented by frequent illness from tackling the more difficult themes of pure economics, he devoted these long intervals of comparative leisure to statistical investigations and to the perusal of factory inspectors' reports, of white books and of blue books, and he plunged into the study of the economic history of Great Britain, so that it became possible for him to interleave the pages of abstract theory, necessarily difficult to understand, with pages that are really living, pages that vibrate with the reflex of reality. At length, abandoning the method he had previously followed of publishing fragmentary essays, he decided to rewrite the work throughout before sending it to press.

After several years of incredible labour, the days being devoted to reading in the British Museum library, and the nights (for he often went on writing until four in the morning) to literary composition; falling again and again beneath the burden of his cross, but ever rising to his feet once more, thanks to the demon within urging him on and thanks also to the sustaining hand of his incomparable friend; he at length completed his task, and in the spring of 1867 sailed for Hamburg with the manuscript of the first volume of Capital, which he entrusted to Meissner for publication. In Hamburg he passed pleasant days with Dr. Kugelmann, a friend and fervent admirer, and with various officials, generals, and bankers; he was visited by a lawyer named Warnebold, an emissary from Bismarck, who, acting on the minister's instructions, exhorted him "to employ his brilliant talents for the advantage of the German people." Before long, however, he returned to London, where he earnestly devoted himself to giving the last touches to his book, which was finally issued from the press in the autumn of the same year.

Thus was at length given to the world the monumental work destined to revolutionise sociological thought, and to give a new and higher trend, not to socialism alone, but to political economy itself. To sum up its drift very briefly, we may say that the argument follows three chief lines, value, machinery, and primitive accumulation. He set out from the fundamental principle (a principle which the philosopher Krause had declared to be as important to political economy as the fall of heavy bodies is important to physics) that the value of products is measured by the mass of labour incorporated into them, and drew the conclusion that the profit of capital is nothing other than the materialisation of a quantity of labour expended by the worker, and is in other words unpaid labour, stolen and usurped income. The worker, that is to say, transmits into the product a value equal to the quantity of labour incorporated therein, but receives from the capitalist a value less than this, a value equal to the quantity of labour embodied in the commodities necessary to reproduce the energy expended by the worker.

Now the difference between the value of the product (that is to say the quantity of labour transmitted by the worker into the product) and the value of the labour power (that is to say the quantity of labour employed in producing the commodities consumed by the worker) constitute the surplus value which is gratuitously pocketed by the owner of the means of production in virtue of the fact that he is owner. In this way Marx attains to the qualitative notion of the income of capital, or explains whereof that income effectively consists. It remains to determine the quantity of income, which cannot be specified unless there have previously been precisely determined the measure and the figure of wages.

Now though it be true that the growth of accumulation virtually tends to bring about an increase in the amount paid in wages, it is nevertheless within the power of the capitalist to obviate this undesirable event by investing the growing accumulation in the form of technical capital, which by its very nature is without influence upon wages. But the capitalist can do more than this. He can transform into technical capital a part of the capital which has hitherto been utilised in paying wages, thus throwing some of the workers out of employment, or creating an industrial reserve army. This reserve army, on the one hand stifles all resistance on the part of the workers in active employment, keeping their wages at a level which will purchase the barest necessaries, and on the other hand permits to capitalist industry the sudden expansions in times of prosperity which to the capitalist are so desirable and so profitable.

Thus Marx's qualitative investigation is succeeded by a quantitative investigation, so that we learn, not only what surplus value is, but that it is equal to all the excess over and above the more or less limited subsistence of the worker, and that the worker is not merely defrauded of part of the value resulting from his labour, but is reduced to a wretched pittance, happy if he can secure this, and if he be not condemned by the hopeless entanglements of capitalist relationships to submergence in the backwater of the most terrible poverty. The result is that to the favoured recipients of surplus value there is subject a brutalised crowd reduced to a narrow wage, while at a yet lower level there struggles in the morass the amorphous mass of those who are condemned to labour without end.

We thus realise, adds Marx, how profit is born of capital and is in its turn transformed into capital. But none of the considerations hitherto adduced suffice to make it clear what was the origin of primitive capital, that which first of all gave birth to profit, and consequently cannot be the product of profit. The celebrated section on the secret of primitive accumulation was intended to solve this problem. Classical political economy, said Marx, regarded the formation of primitive capital as an episode which occurred during the first days of creation. In times long gone by, there were two sorts of people; one, the diligent, intelligent, and above all frugal élite; the other, lazy rascals, spending their substance, and more, in riotous living. Thus it came to pass before long that the former became impoverished whilst the latter grew wealthy, and the wealthy earned the gratitude of the poor by hiring these to work for them in return for a paltry wage. The theological legend of original sin tells us how man came to be condemned to eat his bread in the sweat of his brow; but the economic history of original sin reveals to us that there are people to whom this is by no means essential. We learn that one section of humanity has succeeded in eluding the divine judgment and in procuring for itself bread and cakes by the sweat of others.