Class 6: Capital Chapters 5-9: Absolute Surplus-Value, Valorization, the Working Day

(bright dramatic music) - So the capitalist takes money, which counts for them as capital, and advances it. This is where we were last time. And with that advance buys means of production, which we're abbreviating to MP, and labor power, which we're abbreviating LP. The abbreviations are all confusing, partly because they're originally abbreviated in German, and the words have different initial consonants. So I apologize for that, like the confusion between commodity and capital in our translation, because, of course, commodity in German is (speaks German), and it's a W. So we are moving into the sphere in which we won't be talking about commodities much, and the C will stand for different kinds of capital. So the capitalist takes money and advances it in the form of C, big C, capital C, "Capital," buys MP and LP. Using those two things, the capitalist induces, one way or the other, the producers to make the commodity. And the commodity is now that which preserves the value that went into it and that which has more than went into it. Wow, or how? After this is done, the capitalist takes the product for exchange, prices it at its value, sells but ends up with more, ends up with enough to not only cover their initial outlay but to cover the cost of running the business, to cover their own existence, to cover contingencies that come up, to compete with others. We talked last time about the main contradiction in the general formula. The economists say that circulation is the sphere where equivalents are exchanged, and yet we miraculously end up with more, and nobody ends up with less. This is a (indistinct) mistake. You can't have more without less, because this is a closed sphere. The more has to come from somewhere, it has to already be there in some form. We're about to find out where it comes from. The contradiction is... Oh, I gotta get my pen. MC is an equal exchange. CM prime is an unequal exchange. How do you get this out of this? Marx takes us now to the hidden place of production. Because capital needs a source of more that doesn't get passed on and equalized among everyone. It has to be a non-economic source. It has to follow a different logic. It is a surplus that is not equal in its essence. A surplus, something beyond. We talked about the universal formula for work. A worker works a workable, this is my attempt at a satire of Marx's letters, into a worked, (laughing) but you wrote that down last time. They'll start with the same. A worker is a subject. Work is a transformation. A workable is a raw material. And here is a connection to nature. And the worked is a product, which is really W prime, right? So you know that the difference here has to come between W and W prime. It's the only place that anything changes, changes in the sense of transformation, becoming more than it was. Exchange has no transformation in it except for a change of forms. It has no increase. So this worker works a workable into a worked, turns into, under capital, a capitalist valorizes value, right? A big transformation of work from any sort of artisanal work, any sort of subsistence work, from feudal work. If you take the serf on their farm, as Marx often does, to talk about the feudal relationship, the serf has to pay a certain tithe to the owner, to the lord.

But they don't work for the lord. They work for themselves, and they give up a part of their work as part of the contract, as a gesture. They do not have to valorize value. They do have to produce a surplus beyond their own subsistence. But they don't have to valorize value, because you're not exchanging. They're not, in fact, exchanging at all. Here you realize that this, which is the shape of production, comes under this, valorization, and has to change its character almost completely. This, which we could call work, it's work or production, depending how you think about it, comes under this and becomes the instrument of valorization so that all of its parameters, how much time I get to take, how much fun I get to have, how many breaths I take, you know, the Taylorists, the Taylorites, following Frederick Taylor at the early 20th century, were even concerned with when people stopped to breathe. Could they synchronize their breathing with the work? All of that was an attempt to get more value out of the same work process. So we're gonna talk about valorization today and how that functions. But I just wanna talk about the capitalist for a minute. Because the way this sentence is set up, it seems like the capitalist is the subject of the system. And this is not true. The system has one subject, itself. It is what Marx calls an automatic subject. This may give you lots of reason to have sympathy for capitalists. "Sympathy for Capitalists," that could be the name of my memoir. Sympathy is not, you know, support. It's just like, "Okay, I get it. " Because it looks like, and in a lot of Marxist rhetoric, it sounds like the capitalist is a self-interested, domineering, uncaring, greedy, tight wad, that they're miserly, that whatever they get that's extra goes for themselves. This is not true. In fact, as any industrial capitalist will tell you, I mean, the owner of a supermarket, for example, they have a 2% margin. They have to keep moving everything, wages low, or they can't support themselves. Now, they live at a better standard of living, as we call it now, than many of their workers. That's true, but not better enough to imagine that it all goes to them or that capitalism is for their own benefit. In fact, if you read Marx carefully enough, capitalism is to nobody's benefit, including not the capitalists'. Certainly not in the capitalists' interest for the world to become so hot that nobody can live there, including the workers. Yeah, so that gives the critique of capital an impetus to turn towards the automatic subject rather than class critique, although the two go together. So I want to propose to you now that capital is an impersonal system, an automatic subject that takes classical subjects and objects and processes, and puts them to work for its own system to keep the system going. Everyone has an interest in the system keeping going because, for at least now, that's how we get our hamburger or our veggie burger. Work gets worked at the behest not of a greedy capitalist but of the automaton that is the system. Marx uses two metaphors for this, a machine or a monster. Sometimes he uses the metaphor of an organism. a system. It's kind of a metaphor. What is a system? Things put together in an operational sense for a particular outcome, that have a certain internal necessity. They have to keep working in these relations and these relays in order to produce their output. The oddity of the capitalist system is that it isn't just static. It isn't like your sewer system, let's say, although it does produce a lot of... Nevermind. The capitalist system has many of its parts that change in ways that seem like it should make the system change but don't. It can be totally unrecognizable. For example, there's endless books about how capital is now X type of capital, feudal, the new feudal capital system, or the new rent X capital. Don't be confused. The system doesn't change.

If it does, it's no longer capital. But it can take any instrument. It can use you as service workers or as productive workers. It grows and develops but continues along with its laws, what Marx calls its laws. And the aim of this book is to discover the laws. Okay, now we are looking at chapter what? You could say this labor metabolizes nature, but capital metabolizes labor. Okay. So I'm looking at page 154, just to talk about some of his terms. Did we talk about this last time? Not really? The object of labor and the means of labor? Marx is gonna move from a vocabulary you can figure out to his own vocabulary. So the object of labor is the thing worked, and the means prosthesis by which human laborer works that workable, right, tool, an instrument. Both of these are actually subject to technological development, and this will become very important for fully developed capital. Tech will become maybe the most important variable. And for Marx, in this chapter, chapter five, he gives you a lot of clues about how important these two things are for determining what a society is like. He thinks, and the field of historical materialism develops from this intuition, that a historical epoch is not defined by its products. It's certainly not defined by the ideas that the human beings walking around in it hold. It's defined primarily by the means used to work on nature. And we'll see why in capital this is obviously true. He thinks of this, though, as true for all historical times for the type of creature that is a socially interdependent creature. Why? Because the kinds of things we have, the way we live, if you wanna put it that way, is determined by what we can make, how we can metabolize nature. So in fact, the objects of labor are really determined by the means. Because there is no object of labor that isn't already worked. This is an important datum, right? There's no object of labor that isn't already worked. If it isn't already worked, according to Marx, it can't make any value, like air. It has to be worked in the sense that air, if you want it to be a commodity, has to be somehow contained and not available to all. So a commodity is produced by the enclosure of something that's free, and the prehistory of capital and the continuing history of capital is about the enclosure of things that are free. Anything that is free now is fodder for capital to become a commodity, a value-producing thing. The means for doing this is the means by which those free things are enclosed, taken away from your free use and made available to you as something to buy after you've worked. Does that make sense? This is why the means of labor comes first. And the history of societies is the history of the transformation, development, and un-development, de-development, because it's not just linear, of means of labor, of instruments. The reason that there's nothing... How do we say this? This is getting into the argument that we're gonna get to today about where surplus value comes from. Everything in capital, the capital system is worked, including means of labor. All of these things, like take, let's say, a hammer... Oh gosh, I'm gonna just write it. This is the first time in my life of 25 years of teaching

that I was called upon for a minute to draw something, but I refused. Let's take a hammer and a nail. The nail is obviously the object of labor, right, if you're building something, and the hammer is obviously the means of labor. But both of these are already worked things. That means they contain labor. They have been labored, belabored, labored on. Means of labor and almost all objects of labor are mediated by previous labor. But there are objects of labor that are unmediated, raw materials, but by the time they get to you, they've been mediated by labor, usually several times. And really, it's hard to imagine that there is a pure moment in nature in which something is unmediated. Because, let's say, iron ore, before it's ore, what is it? Earth, let's say earth. Well, somebody in the past discovered that you could take iron ore out of the earth. So maybe there's one moment in which someone is like, "Whoa, what is this heavier stuff? " In which there's no pre-mediation. Yeah, maybe just at the moment of discovering a new material, there's no pre-mediation, but it's already mediated by the idea that we take things out of the earth and centuries of people taking things out of the earth. So there's very few pure, non-pre-mediated objects. Austin? - I was gonna ask, wouldn't the enclosure of the iron mine be a kind of mediator for something raw? - Sure, yeah. - So there is no real raw material. - I mean, there's the moment when Homo originalis stumbles on something a little heavier without knowing what it is. - Right. - But it's a little bit suspect, that moment. But yeah, obviously, you might say we get it from the earth; we don't have to do any work for it. But someone had to get there. Someone had to bring the machines. Someone had to do the work to get it out of the earth. Even if it was sitting on top of the earth, someone had to gather it. Someone had to know it was there. That all counts as part of the labor, right? Richard? - So does the commodity, that it should apply here, that, like, we sort of, because labor is abstract, that sometimes we don't see the labor that's already been put into it. - it? Yeah, everything, it's labor all the way down for Marx's purpose, yep. Hard to argue against that. He's gonna make a distinction in this chapter between living labor and dead labor. This is a useful but maybe not the most true distinction, because there was living labor, and everything's a product of living labor. But there is a moment in which you add the living labor, which is the only time in which value is created for Marx. You're adding living labor to dead labor, and you can hear the metaphoric going on here, a kind of vampiric or zombie-esque, you're bringing back to life something that's dead. But it has, for understanding, let's say, the solidarity of workers, it has an important effect, which is that anything you touch as a laborer has been labored on by someone else. You are in a community or a collective already, even if those laborers are dead and gone or across the world. Does that make sense? Marx says somewhere, which I've never been able to find, so if you can find this quote, which I found quoted elsewhere, write me, that if you knew all of the labor contained in a pen, you would become nauseous. Did I say this already once? Yeah, if you find it for me... Because it's related to the whole history of the world, including the dead, all those people who labored over many, many thousands of generations to produce their living. Okay, so we're looking at this distinction between living labor and dead labor. That's a kind of metaphysical distinction. It will become the distinction between constant capital and variable capital. So he's moving from a register that you understand. Like that's old labor. Call it old labor and new labor. New value comes from new labor. That's the way it is. The old value can transfer its value. Old labor can transfer its value, but it doesn't make any new value. And we're gonna talk about why. Important to note also that for Marx, the only transhistorical characteristic of human beings is that they do living labor, that they make their ways of living. They don't just find them. They live in a society, they're interdependent, and they make their ways of living through actually working.

Okay. This holds true for any labor, for any work to produce our means of existence, let's call it. But when it comes under the system of capital, it changes. And the addition of living labor to dead labor, the addition of new labor to old labor, becomes the crucial lever for what ultimately is called profit. This requires the capitalist to own labor, to supervise it, and to make sure that profit comes out of there, that new value is made, that the worker, it's not so much that the worker is not sloughing off, spending a lot of time in the bathroom or talking at the water cooler. The concern of the capitalist is that they are adding new value to old value. They're adding enough new value. So what the capitalist does is add means of production, both of these, to labor power in order to valorize it. The capitalist adds means of production to labor power in order to valorize it. This is to say what I've said before, but I want you to have it clear. In doing this, the capital system subordinates labor to capital. Because it's only capital that needs value. It isn't the laborers. They can make their means of subsistence, as you've learned, in some cases, in half the day, and you're like, "Bye, I'm going home to enjoy my means of subsistence. " One clarification on means of subsistence, it doesn't mean bare subsistence in all cases. The subsistence is historically determined. That is whatever society thinks you need in order to be a functioning human being. So it could include, as I said last time or a few times ago, a car, an iPhone, health insurance, right? We might have a battle over whether everyone should get health insurance, but it's clearly in capitalists' best interests. It's just that the health industry in this country is taken over by capitalists too. So they're battling against the other sectors. But it's certainly in the interest of car manufacturers that someone pay for the healthcare of their workers. Although, there's a calculation there too as well. I can tell you, I was talking to a friend from before he became a billionaire, who says, "Well, you know, maybe it's cheaper if people die. " So the calculation is whether it's cheaper for the workers to, you know, expend themselves and not pay for their healthcare than it is to pay for their healthcare. That's the capitalist's decision. The capitalist subordinates... I know you have a question. The capitalist subordinates labor to capital supervises the SNALT, makes sure everyone is observing that, right, that you don't take too long, 'cause they have to live up to socially necessary abstract, average labor time. Make sure the commodity is being treated as something to be valorized. That is a bare gelatinous blob. The workers are responsible for the useful qualities. The capitalist is responsible for the geletinicity, such that the value of the object is the principle motivator of all actions, including the capitalist's. And that's why capital is an automatic subject. Value is autonomous. It will be, it wants to be valorized. Value This is the formula for the capital system. It's automatic. Everyone has to hop to. If you don't hop to, you lose your livelihood and your workers. Or the workers lose their livelihood and their boss's. Or an industry goes out or a business goes out. Gisella? - Oh my question is back a bit to the like object (indistinct) distinction. - Yeah, - Wait, I'm so sure how, like I'm understanding of like the leads that, so you going into the hammer and that could really is like, some like causal story behind or like the stuff that goes on, but like why would that affect like the stages of the hammer? Because isn't that... Well, actually, that would just demand like two different questions that isn't like on like when also not like the contact of this kind or like the media stuff. Like why would like a question that isn't about the harm but just like some like narrative about these past

like processes in or- - Well, the past processes, I'm gonna see if I understand your question, you can tell me if I don't, the processes that go into making a hammer or the object of labor, so either the, what do I call it? The means of labor or the object of labor. Those processes are kind of sedimented processes over time. And you could do the history of like the coming to be of a carburetor, a great media theorist, technological theorist, Simon Dunne, did that to show you all of the things that need to happen to knowledge, to materials for a carburetor to come about. But really the idea here is that they're made of old lab... Someone made up. So you can't think of them as just showing up out of nowhere. If you're asking about why Marx thinks it's the means of labor that distinguishes a historical epoch or how a society lives rather than an object, is that what you're asking? Or you have another- - Well, I guess, it's just the idea of like the means, transparency of the object of labor. - Yes, just because to have a new object, you need a new means. It could be that you discovered a new material, but usually it is the tools that determine what the object is. - But does he's like explanatory parts? - He means that a society, an epoch and a society we describe by a phrase as vague as the way we live, and that way we live is basically about how we do our subsistence, right? Let's say our mode of communication. We do our subsistence, I have to give you a call or I have to text you or I have to, I am to... Now there's so many damn modes of communication. I often miss one or two and people have been waiting for me for weeks. Is it WhatsApp, is it... Nevermind. In any case, say our mode of communication that is absolutely down to the means of production, how we make those things. There's a whole field called technology, technological innovation, entrepreneurship, science, that builds those things. But only in so far as you can build those things, can we live that way. That's Marx's argument. Because we can build those things, we then go find new materials, lithium, all those rare earth metals, right? But you don't just, according to Marx, pull some rare earth metal out of the ground, know what it is and be like, "What can I do with this? " It comes the other way around for Marx. That's gonna become important later, when we talk about how technology drives capital into utter insanity, the insanity of the automatic subject, the insane automatic subject. Okay. So for Marx, whatever the dominant means of labor is for a certain epoch defines that epoch. And not only that, whatever the dominant means of labor are for an epoch have to be used by everyone because it changes SNALT, it changes the Socially Necessary Average Labor Time. So if I have WhatsApp, you have to get WhatsApp, because you're gonna miss my messages. If I have a faster machine for spinning yarn, you gotta get it too 'cause you'll go outta business. Sometimes the technology is cheaper labor and more labor in a different part of the world. But that's a kind of technology too for Marx. In any case, that soon comes to be technologized. These are the two requirements for labor power. So the requirement for the means of production is that it labor, means of production, which are both of those things, is that they are consistent with everyone else's means of production. At least in this age, you can't be doing weaving sweaters in a cottage when someone else is weaving sweaters with a machine. You will go outta business. Except for a luxury market, which is not being considered here. The conditions for labor is that it must function under normal conditions. This is very important. Whatever they are. So that means labor has to work with the technologies that are there, and you can see immediately that what this means for labor is that if you learned how to do it one way and there's a technological change in your lifetime, the way you learned how to do it is worth nothing.

You have to get retrained. A whole educational apparatus is made to upgrade your skills. We have terms for this like lifelong learning. This seems to be a good in itself, but it isn't. Down with education. Whatever the dominant means of labor are for a certain industry, they have to be used for every firm in that industry. And usually one industry affects all the other industries, 'cause suddenly you're making more widgets at a much faster rate for a lower price. They can't process them in the other industry fast enough to sell them. They have to upgrade their technology. Upgrade, it's the perfect example of a capitalist function. Must function under normal conditions, labor, power, and it must function as normal labor. That is with an average level of skill and dexterity and stamina. So it has to have the technology that everyone else has and use that. And then whatever the labor is doing, it has to do it comparable to everyone else. This includes two terms that I want you to keep in mind, 'cause we'll come back to them. Formal and real subsumption. Subsumption names the way labor is included in the capital project, and it's my contention that at least in the core economy's, real subsumption has been the lever of productivity increase and profit increase in the last 50 years. The main lever, real subsumption, which very few people talk about. Formal subsumption is when you go to work and someone still has to tell you what to do and how to do it efficiently. Real subsumption is when you do it because you love it, you've internalized and become really subsumed in your labor. We'll talk about that later, but keep it in mind. Now we're going on to chapter six, very quickly. We're a little behind, but better to understand no than to race ahead. Constant capital and variable capital. You're like, "Karl, enough with the terms! ", right? Just wait. Constant capital will later be called fixed capital. With each set of new terms, he's getting at a different aspect of the entity, because the entities are not simple, natural, unified entities. They're being used for other purposes and so different characteristics of them are coming into existence. You could say, in the 10th century, nobody knew an iPhone had value. Okay, they didn't have iPhones in the 10th century. Whatever it was, they didn't think of it as a value object. Value became part of the entity, commodity only after capitalism happened. It wasn't even there before. The strange history of things in history. So here in chapter six, the means of production become constant capital and labor power or labor become variable capital. You'll remember that we are tracking this. This is the (indistinct) nature of labor. It is both actual labor and labor power, and the actual labor is greater than the labor power. That's the peculiarity of labor under capital. You can get more out of someone than the labor power they sold you. So we're tracking that. That becomes what he calls variable capital. Why is it variable? Because you can get more labor out of the laborer than what they sold you. It's a variable magnitude. The magnitude of this, the means of production, is not variable, it's constant. So I advance $100 for a machine and some raw, what are we making?

Terrible at examples. Chewing gum materials. We're making chewing gum, a great capitalist invention. No nutritional value. What is the use value of chewing gum? Entertaining your mouth? I dunno. Bothering your neighbors? Let's make chewing gum our commodity. The means of production, you just invest $100 in a chewing gum machine and you invest 1 cent in the materials. Is it petroleum? Is that what it... I don't even wanna know, right? And so it's $100 and 1 cent that you put in constant capital. And then variable capital say it costs you a dollar to make a stick of chewing gum. Just to say it, I'm not gonna work this out in this particular instance, but what he wants to say is this all goes into the stick of chewing gum. The $100, how many sticks of chewing gum can you produce with a chewing gum machine? 10 years? Like let's say, what would it be? 10,000, let's just say 10,000 for that. So it puts 1 cent of value into the stick of chewing gum and the materials cost put 1 cent of value. So from constant capital you got 2 cents in there, 2 cents of value. Why? Because the machine keeps going and can make another, what did I say? 9,999. 99, whatever, sticks of chewing gum, okay? It's not that constant capital. It doesn't add value, it's just that the value is not added because it was already there. For the capitalist, it is a mere exchange of equivalents. You couldn't have a stick of chewing gum without this transfer of value. But it doesn't add a thing. It doesn't help the capitalist get to their product. In fact, the more expensive the machine is, the less they're gonna have, because the only place you can get more is here. And the only place that more comes from is the difference between labor and labor power. You have to see more about how that works. We have in this chapter a couple of operations, which I wanna go over. We're talking about how value gets into the product. He talks about this in a fairly alchemical way, as though the value is here and it goes into the product there. It's a useful way to talk about it, but we shouldn't get confused and think that Marx thinks there is a transmigration of souls, as he calls it, whenever he uses those religious or metaphysical terms, he is ridiculing capital, but also saying that it has this side to it, it has a metaphysics to it, and it's a real metaphysics because he can't simply choose to not believe it. You have to treat these objects as though they had value, even though the value is not there physically. We're talking about the valorization process. And in valorization there's a mode that he calls the preservation of value. There's a kind of law of the preservation of value. It's like the E equals mc squared of capitalism. It goes from here into the product. There is some wear and tear on things just from sitting around. There is waste. Like he says, when you make yarn, you lose, I don't know, 10% of the cotton. So there's waste as well. That waste has to be figured though into the rate of transfer. So whatever waste would go maybe be 0. 0105 cents because it's part of the cost of production. Value here is preserved from here and here to here. What does this mean for the worker? Can you imagine? The boss is like, 'why are you flossing your teeth with that cotton? I need to get value out of it," right? You can't misuse the materials of production. That's what formal assumption is there to ensure, that the supervisor says, "No, no, no. All of this is for value creation. " So a prime job of the laborer is to preserve the boss's value, not to abuse the machine. This is why sabotage is so effective. Not only because it stops work, but because it affects value. It might even ruin the value that the capitalist has invested in the machinery

by ruining the machine. Okay. So a main job of a laborer is to make sure that none of that labor that previously existed there goes to waste, as little as possible. It's a funny idea that you are there stewarding as a worker, someone else's property. But from stewarding someone else's property, they don't get anything more. They have to pay you to do that, but they don't get anything more out of it. Constant capital is the value advanced for the means of production. Part of the value advanced for labor, variable capital, goes towards preserving this value that was already there. This is what he's talking about, in part at least, in chapter six. Variable capital goes for the purchase of labor power, but it only part of it. I'm gonna give you a leap into the next chapter before we quit for the day. That is, don't you love all these acronyms? It goes into the laborer's means of subsistence. The means of subsistence is too much in the perspective of the laborer still, like, "What do I need to survive? " The owner is thinking, "What do they need to survive? " And it may include noise-canceling headphones, especially given how noisy Yale students are. It could include all of those things, right? Means of subsistence. So with a historical epoch, it goes up and down, depending what the general social level of means of subsistence are. And it could actually go down. You can actually give up very expensive things that you don't need. People who move to a city don't need a car, for example. Austin? - The means of subsistence doesn't just apply to the individual workers, it applies to their children, and to put a preservation of a workforce, right? So it's not just enough for the worker to stay alive, it's make more workers. - So we are getting to that. We're now moving from the narrow entry point into the capital system through the commodity to the people who are, like puppets, moved around by the system. And that includes not just the worker, but the, I love that, I don't have to write out words now. You can just read letters. The future worker, that is the worker tomorrow and next year, but also the baby worker. (students giggling) And how about the domestic labor? Traditionally in 19th century Europe and in many other places, a woman, often too an immigrant, now especially, all of this belongs to the means of subsistence, and it all has to be paid for out of the wage. That's the way capital works. It's not that if you paid house workers, as they wanted to do in second wave feminism, a wage, this would change. It would just raise the cost of the means of subsistence, and it would probably push the need for free labor elsewhere, right? They'd be like, someone would be like, "Well, you know, couldn't you get your kids to do that? " I've been trying for years. Richard? Did you raise your hand? Oh, I thought you did. We are now moving into... Okay, we're talking about variable capital, V. Gets split into two, when you pay the worker, it gets split into the means of subsistence and surplus value. Next time, which will be next week, you should read the "Working Day" chapter, which is about 100 pages long. But we will spend the first part of the lecture talking about the production of surplus value. Just keep in mind that the means of subsistence are taking care of during necessary labor time

and surplus value is taking care of during surplus labor time. And have a good weekend. (dramatic music)