A Critique of Political Economy

IN the mid-1850s Marx began to set down his thoughts on political economy in manuscript form—but only after he had in long years of painstaking labour worked his way through a fantastic number of books, technical writings, legal journals, parliamentary records, and had analysed all the available economic and sociological statistics, newspapers, reports on industry, trade and the stock exchange.

At first he looked upon all this as only preparatory work. But in 1857, what he had long been predicting came to pass: a worldwide economic crisis. His theoretical view, arrived at through his study of the economic processes of the past and the present, that economic crises regularly arise in capitalism, was now confirmed in practice. His belief in the intimate connection between economic and political development was also shown to be correct once more.

The outbreak of the new crisis persuaded Marx to bring his researches to an end for the time being and put together his economic studies. On January 21, 1859, the fair copy of the manuscript was ready but could not be sent off. “The unfortunate manuscript is ready,” Marx wrote to Engels, “but cannot be sent forth, because I don’t have a farthing to liberate it and to insure it.  The latter is necessary, since I do not have a copy.” The greatest theoretician on the role of money did not have the money to mail the first fundamental work about money to the publisher! But Engels helped out again, so that the manuscript could shortly be sent off to Berlin, where it appeared in June in 1000 copies under the title, “A Critique of Political Economy, Book One.”

When Marx informed his friend Weydemeyer of publication of the book, he wrote: “I hope to win a victory for our party in the field of science.”  How could a purely scientific book help the advance of the workers’ revolutionary movement? It did just that because in it Marx began to solve the phenomenon that had remained a mystery for the bourgeois scientists, or which they had avoided tackling: the essence of capitalist exploitation.

With compelling logic and on the basis of irrefutable evidence Marx showed that the commodity and value are not eternally valid, “naturally evolved” phenomena, but have an historically transient character. He therein made a discovery that was the key to the solution of a whole series of complicated problems in political economy.

“A Contribution to the Critique of Political Economy”, one of Marx’s most brilliant works, opens with his preface, giving a concise outline of his economic research and a classic definition of the materialist view of history, which suggest highly revolutionary conclusions equally important for theory and practice. Marx says:

“In the social production of their existence, men inevitably enter into definite relations which are independent of their will, namely, relations of production appropriate to a given stage in the development of their material forces of production. The totality of these relations of production constitutes the economic structure of society, the real foundation, on which arises the legal and political super-structure and to which correspond definite forms of social consciousness. The mode of production of material life conditions the general process of social, political and intellectual life. It is not men’s consciousness that determines their existence, but their social existence that determines their consciousness. At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production, or—this merely expresses the same thing in legal terms—with the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an era of social revolutions.” This classic definition of the basic conclusions and propositions of materialism as applied to social relations makes the preface a document with a scientific value of its own.

Apart from the preface, the first part of “A contribution to the Critique of political Economy” consisted of two chapters: “The Commodity” and “Money or Simple Circulations”.

The chapter “The Commodity” is the most difficult in terms of exposition and comprehension. Marx brings out in the most simple form of the commodity the contradictory character of capitalist production, thereby establishing the initial theoretical principles for a further analysis and criticism of the economic categories of bourgeois society. An important feature of Marx’s method is that he starts with the more elementary forms and then proceeds to the more complex ones. His analysis of commodities and value is not an end in itself. It paves the way for a logical transition to an analysis of money and capital.

At first sight bourgeois wealth appears to be a vast accumulation of commodities, with the individual commodity as the elementary existence of this wealth. The commodity—the object of purchase and sale—is defined by Marx as a contradictory unity of use-value and exchange-value.

Use-value signifies the capacity of a thing to be the necessary, useful, to be object of human requirement. Use-value constitutes, in any society, under all social forms of production, the material content of wealth, and is produced by concrete labour, the labour of the cobbler, the tailor, the carpenter, the ploughman, and so on.

By contrast, exchange-value represents an economic relation. The labour embodied in the commodity which produces it is indifferent to the specific substance of use-values and to the specific, concrete form of labour itself. It is labour deprived of distinction and lacking quality, “labour in which the individual characteristics of the workers are obliterated.” This labour, which constitutes the substance of value, is called abstract-universal labour by Marx. Abstracting universal human labour means reducing various types of labour to simple average labour, that is, to the labour which the average individual of a given society is capable of performing. The labour represented in value is performed as the labour of a separate individual, but through the medium of exchange and market relations it assumes the form of its opposite and becomes abstract-universal labour. Thus, this labour is the specific social form of laour.

Although his predecessors, including Ricardo, drew a distinction between use-value and value, they were unable to define their relationship. Having discovered labour as the source of value, they were unable to establish the specific feature of labour which creates value. Concerned solely with the magnitude of value, and defining it as labour-time embodied in the commodity, they were unable to see the qualitative side and show the specific nature of the forms of labour represented in use-value and value. Marx was the first to do this. His great scientific accomplishment is his detailed exposition of his doctrine on the twofold nature of the commodity as a unity of use-value and exchange-value, and the twofold character of labour as concrete labour and abstract-universal labour. He dispelled the mistakes notion that the sphere of commodities consists of relations between things, and set out the scientific prerequisites for a profound and general critique of all the distorted forms in which the economic laws of capitalism appear.

In the second chapter, Marx produced a truly scientific theory of money and money circulation, and showed that money is not introduced into the circulation for the sake of convenience, but is produced by circulation itself. A specific commodity begins to function as money, because its natural properties—ease of transportation, divisibility and so on—enable it, and no other, to serve as an adequate expression of value, and to appear in the process of exchange between private commodity producers as the embodiment of social labour. Money has value not because it performs a definite social function, but because it is a product of labour, and consequently possesses a real value, like all other commodities, not an imaginary or conventional one. Money is the supreme expression of value, which has evolved from the development of the contradiction between concrete labour and abstract labour, between use-value and the value inherent in commodities. It is the form in which individual labour appears as social labour.

Having analysed all the historically rooted functions of money—money as a means of circulation, as a means of payment, and as world money as a means of hoarding—Marx formulated the law governing the quantity of money required for circulation, and other laws of the circulation. 
“A Contribution to the Critique of Political Economy” was a real revolution in political economy. Marx demonstrated the superiority of his economic views over the theories and dogmas of the bourgeois economists. The advantages of his method and his uniquely correct approach to the subject of Political economy enabled Marx to draw conclusions in his study of the fundamental categories of bourgeois economics which exploded notions that had seemed established and well-nigh unshakable. He also gave further evidence of theoretical flimsiness of Proudhon’s critique of bourgeois property and all his plans to eliminate its “evil aspects” through the reforms, which Proudhonism, a false brother of scientific Communism was advocating.

Consequently, the publication of “A Contribution to the Critique of Political Economy” was a twofold theoretical victory for the revolutionary party of the working class, a victory over bourgeois political economy and a victory over the petty bourgeois brand of political economy as represented by Proudhon and his followers.

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