Chapter VI. Presentation: Capital

The dialectic of enlightenment has reached a contradictory stage in the era of capitalism, an economic system which creates the potential for a new humanity while exploiting people and which universally propagates an undreamed of wealth of knowledge in the form of mass deception.[1] Capital, an analysis of the system of commodity production in its ideal conceptual purity, provides clarifications which lead to a comprehension and calculus of its emancipatory and repressive tendencies. The two-faced rationalizations of bourgeois political economy – ideology in an emphatic sense – are traced by Marx to the bifurcated nature of commodities and of their production. Conceptual, social and historical analysis dispels the confusions which characterize the fetishism of commodities and paints the way to realizing the un-kept promises of our epoch. The capitalists’ most authentic language, the equations of profit, is transformed into indices of exploitation and calculations of potential human progress by questioning the foundations of capital which had remained presupposed but unspoken.

The Form of Value of Commodities

A repeated conclusion of the preceding interpretation of Marx’s work has been that the realm of production has a priority in the analysis of society and that an analysis of capitalism must therefore begin with a consideration of commodity production. Part I of the first volume of Capital is accordingly on “Commodities and Money.” The discussion takes place in terms of a theory of commodity value, designed to clear the confusions surrounding the nature of money.

In his original preface to Capital, where he warns of the difficulty of reading Part I, Marx likens his economic science to biology and chemistry, which study the elementary cell or molecule in order to understand large complex bodies. In Marxian economics, however, the “force of abstraction” must replace the tools of microscope and chemical reagents, increasing the conceptual strain. Continuing the analogy, Marx states that in capitalist society “the commodity form of the product of labor or the form of value of the commodity is the economic cell form.”[2] Thus, the starting point for a systematic presentation of capitalist production is the commodity form of products and the form of value of the commodity.

Several models of systematic presentation useful in following Marx’s arguments suggest themselves. The extreme contemporary form of systematization is axiomatization, in which one begins with formal definitions and mathematized axioms, proceeds through a hierarchy of theorems derived from the axioms and finally provides an interpretive scheme relating the most derived propositions to reality. Marx’s analysis of the way in which the quantitative value of a commodity varies under different conditions is easily adapted to this mathematical approach.[3] A parallel technique is the dialectical method Hegel employs in his Science of Logic which, for instance, analyses the mutual determinations of what he calls “reflex categories.” This approach is very much at work in Marx’s development of the form of value. However, as opposed to mathematics and idealism, Marx’s work is materialistic and political. Materialistically, the presentation of commodity production stresses the historical specificity of this mode of production and grounds the analytic categories in their historical object. As political, Capital strives to reveal the situation of people in society – a task necessitated by the tendency of commodity relations to obscure social, interpersonal relations.

Capital’s path from the simple abstraction of the commodity to the complex concreteness of capitalist production as a totality is at every level teleologically determined by its real object, as this had been encountered in the concrete history of class struggles and in a succession of pre-Marxian theories of surplus value. Of particular interest in relation to continental philosophy from Hegel to Heidegger, is the way in which Chapter 1, which culminates in the revelation of the secret of commodity fetishism, is motivated by the misleading character of the form in which the value of commodities “appear.”

Marx’s discussion of the form of value, his most original theoretical contribution to the analysis of capitalist economics, is the most difficult section of Capital. The history of Marx interpretation can be viewed as a kaleidoscope of misinterpretations of this section. Marx was well aware of the problem and posted warnings repeatedly. On the first page of text in Capital, in his Preface to the first edition, preceded only by a note on the circumstances of publication, Marx warned:

All beginnings are difficult; this goes for every science. The comprehension of the first chapter, namely the section containing the analysis of commodities, will therefore present the most difficulties. That which specifically concerns the analysis of the substance of value and of the magnitude of value, I have popularized as much as possible. Not so with the analysis of the form of value. This is difficult to understand because the dialectic is much sharper than in the first presentation. I therefore advise the reader who is not thoroughly accustomed to dialectical thinking to completely skip the section from p.15 to p.34 and instead to read the appendix at the end of the book, “The Form of Value.” There I have tried to present the matter as simply and even as didactically as its scientific nature allows. After finishing the Appendix, the reader can proceed with the text at p.35. The form of value, whose completed Gestalt is the money form, is without content and simple. Nevertheless, the human spirit has sought in vain for more than 2000 years to get to the bottom of it.[4]

In later editions and in the English translation, the section of sharp dialectics and the reference to it in the Preface have been deleted and the appendix has been moved into the text as the bulk of section 3. The popularized replacement and its translation are so commonsensical that it is easy to overlook what remains of the “sharp dialectic” and to misjudge this cornerstone of Marx’s theory.

Especially if one is to consider Capital as a philosophical statement adhering to rigorous methodology, it is imperative to follow the first edition^’s analysis of the form of value. For it is here that Marx unfolds his dialectical materialist presentation of abstract labor, as the defining characteristic of capitalist production. Once comprehended, this presentation preserves the revolutionary content of the labor theory of value from bourgeois revision, not least of all by revealing the secret of commodity fetishism. The genetic demystifying de-construction of fetishism disarms the power of commodity relations to obscure their origin in the labor of the working class. Accordingly, the following discussion of Capital will limit itself to retracing Marx’s sharp dialectic from the definition of the commodity, through the establishment of abstract labor, to the domination of fetishism.

Through an understanding of the significance of this dialectic, the separation of Marx’s work into an interpretive (qualitative) outlook and an explanatory (quantitative) calculus can be made more precise in terms of the analysis of the substance, magnitude and form of value. The view that human labor is the substance of all value provides a basis for proletarian “ideology.” Economics which calculates the magnitude of value on the basis of the quantity of socially necessary labor time embodied in a product can serve as a corresponding “science.” Marx’s approach is not strictly opposed to these, but neither is it limited to them. Marx’s analysis of the form of value – which presupposes neither its substance nor its magnitude – provides a basis for what would otherwise be “mere ideology,” a perspective chosen on the basis of self-interest alone. By comprehending the social constitution of abstract labor as an historically developed category, the analysis of the form of value provides the theoretical precondition for defining the substance and magnitude of value in terms of abstract human labor.

An ideology of labor makes the same false move as the ideology of capital: absolutizing categories of the present era as eternal. Marx’s goal is not the worship of labor – it was not he who coined the concentration camp slogan, “work makes one free” – but the just reward for the unfortunate necessity (un-freedom) of work. Just reward according to the theory in Capital consists in the worker owning the surplus value produced by his work or, less simplistically, a society of producers jointly owning the full product of their social labor. The theory of surplus value which spells out this goal takes labor as the substance of value and labor time as the measure of the magnitude of value. But it is the analysis of the form of value as historically specific which lends the critical sharpness to the socialist goal as anti-capitalist, as historically situated.

The common impression is thus wrong, that Marx’s primary theoretical contribution is the proposition that commodity prices are determined by the labor time required for their production. Even this proposition does not, as Heidegger has suggested, claim that labor is the substance of commodities, but rather that abstract labor is the substance of the value of commodities. However, even the correctly understood economic proposition is not peculiar to Marx. John Locke and William Petty had long before argued for such a labor theory of value and Adam Smith and David Ricardo had also accepted it. Only when the capitalist class had established itself over the aristocracy, did economists fear that the labor theory could be transformed from a bourgeois to a proletarian ideology, a possibility forcefully symbolized by the Paris Commune of 1848. Marx then championed the labor theory, but he did not present it with much fanfare in Capital.

In its simple form, the proposition that labor is the substance of value has little need of argumentation. Strictly speaking, this proposition is not only non-deductive, but for Marx it is neither descriptive nor prescriptive. It neither describes the appearance of the prevalent pricing scheme, nor simply provides a measure of values for a future society. As a theoretical abstraction, labor value grants social theory a tool for comprehending and distinguishing various aspects and categories of value. The critic of Marx’s theory must, therefore, answer to the power of Marx’s system to analyze capitalist society as well as respond to the arguments in Marx’s earlier writings and in Locke and others. It must of course be remembered that Marx never says actual prices are simply equivalent to a measure of labor time. Their “determination” (in the non-mathematical sense) by labor time is merely the first of many conditioning factors – first not so much in quantitative importance as in the chain of increasingly complex explanatory analyses presented in Capital.

Marx’s approach to the analysis of value is scarcely oversimplified by starting with a statement from near the start of Chapter I of Capital. “We know now,” says Marx already, “the substance of value. It is labor. We know its magnitude. It is labor time. Its form, which stamps value as exchange value, remains to be analyzed.”[5] This task of analyzing the form of value is indeed what remained for Marx to contribute to political economy. In a footnote concluding his presentation of this analysis (retained in a different context in later editions), Marx outlines the reasons for the previous neglect of this task as well as for its critical import:

It is one of the fundamental failings of classical political economy that it never succeeded in discovering, on the basis of analysis of the commodity value, the form of value, which makes it into exchange value. Even in its best representatives, such as Smith and Ricardo, economics treats the form of value as something completely uninteresting or external to the nature of the commodity itself. The reason is not simply that their attention is completely absorbed by the analysis of the magnitude of value. It lies deeper. The form of value of the product of labor is the most abstract, but also most general form of the bourgeois mode of production, which is thereby characterized as a specific kind of social mode of production and is thus simultaneously historically characterized. If one therefore mistakes it for the eternal natural form of social production, than one necessarily also misses what is specific in the form of value, that is, the commodity form, further developed as the money form, the capital form, and so on. One can thus find among economists who are in thorough agreement about the determination of the magnitude of value by labor time the most varied and contradictory conceptions of money.[6]

Before proceeding with his analysis of the form of value, Marx clarifies the distinction between use value and exchange value. The use value of a commodity is its utility in satisfying human needs. It is a function of the physical properties of the commodity considered as a natural object. Although use value does depend upon the social development of human needs, it is a basically trans-historical category. Exchange value, on the other hand, is the value of a commodity in exchange, on the market. It is a thoroughly social category, specific to exchange economies. Commodity production is defined by the congruence of use value and exchange value in the product. Production for the immediate satisfaction of one’s own needs is not considered “commodity production.” To produce commodities one must produce use values for others, social use value, products whose utility is only realized through the medium of exchange.

This kind of definition, distinction and clarification could be made by any Anglo-American philosopher and is not a primary accomplishment of Marx. However, in addition to stressing the social character of exchange value against the confused ideologues who saw the exchange value of a commodity as a natural property, Marx applied the distinction to labor. This latter point, that the labor embodied in a commodity has the same two-fold character as the commodity produced is, according to Marx, the fulcrum around which the comprehension of political economy revolves. Marx was the first to develop this point critically. The theory of surplus value developed in Capital, which explains the exploitation of labor by capital, is based on this point. That is, the contract between capitalist and laborer, which claims to exchange equivalents, actually pays wages equivalent to the labor power’s exchange value (subsistence) in exchange for its considerably greater use value (productivity). The revelation of this injustice in the exchange of wages for labor power is, indeed, the fulcrum for Marx’s critique of political economy.

According to Marx’s theory of surplus value, then, the social antagonism expressed in the class conflict between labor and capital is based on the distinction between the use value of labor and its exchange value. The social antagonism is thus fundamental to bourgeois production, in which both labor and its products are determined in opposing ways. For, there are not two separate kinds of labor embodied in the commodity, but rather, the labor is variously and even incompatibly “determined” (entgegengesetzt bestimmt). This is the contradiction between use value and exchange value, which is the fundamental contradiction of capitalist society and which appears in the form of many social contradictions, antagonisms and crises.

The potentially misleading term, “contradiction,” is to be understood in the sense that production is subject to criteria which make incompatible demands. In necessarily compromising on each criterion under the pressure of competing criteria, the desired effect is altered. The contradiction develops under its own impetus in directions not simply related to any one of the original criteria. For instance, the drive to produce exchange value may either eliminate (as unprofitable) the production of certain socially urgent use values or it may encourage over-production beyond the limits of consumption (as use value), resulting eventually in economic depression. Alternatively, technological progress, which is encouraged by the drive for private profit, exerts a social tendency to lower the rate at profit in a self-defeating interplay of private and social determinants.

Another way of looking at the capitalist contradiction is thus in terms of the antagonism of private and social constraints on commodity production. In pre-capitalist, non-commodity production, the individuals (or family or tribe) themselves produced what was directly necessary for themselves. Production was carried out privately in accordance with private criteria or else it was carried out communally in accordance with purely communal requirements. In commodity production, production is organized privately by the capitalist who hires wage laborers to supply the labor power and it is organized for the private end of accumulating capital. However, the means of achieving the end have a social character and the private production must fulfill social conditions. The commodity must be sold on the market in order for its exchange value to be realized: it must thus be a social use value; it must also be competitive with other commodities on the market in terms of quality and price; this means the efficiency of the productive techniques must be up to the social norm; and so on. The dynamic engendered by the definition of commodity production as production for private gain through social exchange can be seen in the macroeconomic development of capitalism out of feudalism and into crisis as well as in the microeconomic relations of the steady-state system.

The historical dynamic also reveals the material pre-conditions for the harmonious economic system implicit in a critique of the contradiction between use value and exchange value, private production and social exchange. A post-capitalist society would, that is, have to remove the antagonism of exchange to human utility by socializing the processes of production and consumption through a non-capitalist and non-private distribution of both the means of production and the results of production. At least some of the preconditions of such a social transformation are already given as results of the development of capitalism: a world market, enormous productivity, advanced communications, computerized information processing, centralized economics and, last but not least, the threats of the consequences of continuing to exist under capitalist relations and crises: nuclear war, starvation in the third world, irreparable ecological damage, fascist governments and in general the repression of free human activity as it is now possible.

The cornerstone of Marx’s analysis of the capitalist contradiction is the sharp dialectic of the form of value of the commodity form of the product of labor. The analysis of the form of value follows a dialectical format because it is an analysis of the mutual mediations of moments in the relation which defines the form of value of commodities. The analysis parallels Hegel’s famous master/slave dialectic in his Phenomenology of Spirit because both the relation of the form of value and the relation of master to slave are, like the relation of left to right, examples of what Hegel calls “reflex categories.” You cannot have the one without the other.

The characteristic of commodities, versus products of pre-capitalist production for immediate consumption, is that they are exchanged. Furthermore, they are exchanged in specific quantitative proportions. This emphasis on quantity is characteristic of capitalism, distinguishing its systematic exchange from the more sporadic, qualitative and variable trade and barter which plays a secondary role in pre-capitalist economics. The simple, first or relative form of value of the commodity is thus:

x of commodity A = y of commodity B

or, e.g., 20 yards of linen = one coat

or twenty yards of linen are worth one coat.

The form of value is the equation. The equation posits quantities of different kinds of commodities as equivalent. The value of the one commodity is reflected in the value of another and neither has a value outside of such equations or relations of exchange. The common denominator of the commodities (their substance) which allows them to be equated in definite proportions is labor. In equating different types of products of labor, the form of value equates the different types of labor expended. The form of value is thereby the source of abstract human labor as such. The next section will follow this analysis of the form of value as presented in the first edition of Capital.

Abstract Labor in Theory and Practice

“The real relation of commodities to one another is the process of exchange.”[7] The relative form of value given by the equation, x of A = y of B, is the abstract representation of the concrete historical, social process of exchange which takes place in terms of money; this elemental form of value is “in a certain sense the cell form or, as Hegel would say, the in-itself of money.”[8]

In the language of the Grundrisse, the relative form of value is the ultimate abstraction, from which a systematic presentation of the concrete totality can begin. Later in Capital, Marx deals with the real process of exchange, but in Section 1 he is working on a high level of abstraction comparable to that of Hegel’s Logic. Unlike Hegel, however, Marx conceives of the abstract determination as itself a result of the concrete processes which it analyses. The abstract is only a “source” of the concrete in theoretical presentations, not in real historical processes. Recognizing this, Marx was consistently able to understand Hegel’s system better than Hegel had, namely as an analysis of the logic of the capitalist world as opposed to a description of actual developments. Marx’s Hegel critique is as important to his analysis of abstract labor as his critique of Feuerbach and religion is to the analysis of fetishism. Both these analyses take place in terms of Marx’s materialist dialectic of the form of value.

A fundamental point of Hegel’s master/slave dialectic, and one which Marx accepted, is that the categories of master and slave presuppose (mediate or reflect) each other, so that someone is only a master in so far as others relate to him as slaves, while the others only believe that they are slaves because he is a master. Furthermore, the process of mutual recognition is essential to ego development, to the determination of consciousness as human self-consciousness. Hegel rejects as abstract and a priori the proclamation of human self-consciousness through Descartes’ cogito sum or Fichte’s Ich bin Ich. People constitute their self-consciousness of themselves as people through a process of social mediation. Only through the relation to another as a fellow man can one first relate to oneself as a man. The other thereby serves as the form of appearance of the species man.[9]

Marx applies this dialectic of reflexive categories to the form of value, x of A = y of B. To begin with, A and B are natural objects, use values, but not yet commodities because they have not yet been determined as exchange values. For the purposes of eventual exchange, A has been equated with B in a definite proportion. A is then able to relate to itself as a value as a result of its setting itself equal to B as a value (as the embodiment of labor, not as a use value, for A and B are not equal as use values since they have different natural properties). Insofar as it relates to itself as a value, A distinguishes itself as a value from itself as a use value. Whereas the use value of an object appears in the natural characteristics of the isolated object, its labor value appears only in its relation to another commodity as qualitatively equal in certain quantities. Value thus only receives a unique form distinct from use value through its presentation as exchange value.

The simplest form of (labor) value is the relative form of the value of A relative to B, where A is seen to embody labor because it sets itself equal to another commodity and the only basis of comparability is the common characteristic of embodying labor. The fact that A reflects its value in the value of B, that A is mediated by B, has, in turn, an effect upon B. B is no longer simply a use value, but is determined as an exchangeable use value. B now possesses the form of immediate exchangeability with other commodities, the form of being an equivalent. This new determination of B as equivalent is a result of the same equation, x of A = y of B, which gave A the relative form of value. B’s equivalent form of value does not merely determine B to be a value (an embodiment of labor), but a value which in its physical Gestalt of being a use value acts as a labor value for other commodities and is thus immediately present as an exchange value. In this description of the equivalent form of value, the word “immediate” indicates that there is no third term, such as money, mediating the exchangeability of B for A. The case where A is sold for money and that money is used to buy B (the formula used later in Capital: C-M-C) is the more advanced case of the money form of value and is excluded from the simple relative or immediate equivalent form of value.

Considered purely as value, a commodity consists solely of labor, it is a crystallization or objectification of human labor. However, insofar as the natural form of a commodity reveals the labor which went into producing it – and not all commodities show such physical traces – what it presents is signs of specific, concrete labors (e.g.. weaving) and not of abstract human labor as such. To determine a commodity as a value, as the embodiment of abstract labor, requires a process of abstraction. “To take linen as a physical expression of human labor, one must ignore all that really makes it a thing.” To consider this process of abstraction a subjective act of a judging subject would be idealism: “Objectivity of human labor, which is itself abstract and lacking quality or content, is necessarily abstract objectivity, a product of thought. The woven cotton thereby becomes a figment of the imagination.” Marx transfers the Hegelian dictum, that essence must appear, into the material realms: the determinations of commodities must be expressed in their material relations. “For commodities are material objects (Sachen). What they are, they must show in their own material (sachlichen) relations.”[10]

Such materialism (Sachlichkeit) is neither a “metaphysical” assumption nor an immediate consequence of Marx’s situation in a context of rising capitalism. Its distance from both is due to the mediation of critical reflection. It represents a critique of Hegelian idealism and utopian thought, on the one hand, and that vulgar materialism which takes money as the really real, on the other. Marx’s materialism includes the thesis that the concept, the ideal and the dollar are all abstractions, to be comprehended and demystified in terms, ultimately, of commonsensical natural objects. Marx thus rejects Hegel’s claim that the concept (Begriff) can objectify itself without needing an external matter. But Marx’s approach here goes significantly further, even laying the basis for a possible critique of Heidegger.

As any hermeneute knows, the interpretation of something as something must be founded in the matter itself (Sache selbst). Where Heidegger speaks in the anonymous passive voice of the way in which beings “are given as present,” Marx not only describes the way commodities actively present themselves, but goes on to show how the apparent activity of commodities is a mask for the underlying action of their producers, human beings. This should become clear in the analysis of fetishism. For now, the comparison with Heidegger can clearly be seen in Marx’s summarizing statement: “The natural form of the commodity changes into the form of value. However this quid pro quo brings itself about (ereignet sich) . . . only within the relationship of value.”[11] Here Marx uses the term, sich ereignen, which Heidegger has more recently chosen as the term most appropriate to articulating ontological transformations. But where Heidegger uses das Ereignis as a “place holder” for transformative processes without committing himself to any content, Marx uses it to express a process of interaction between commodities, thus a social process involving the exchange market. The task of Marx’s sharp dialectic in Section 1 of Capital is, in fact, to trace this process of ontological transformation from beings as natural use values to beings as social labor values and to comprehend the change in Being as a fundamentally social process.

The use value of an object depends directly upon its natural properties. These natural properties express its use value. The use value of a commodity is non-relative, non-abstract and non-quantitative. Labor value is otherwise. It is a measure of abstract human labor, which is not simply identical to the specific concrete labor that went into producing the commodity. In the relation, x of A = y of B, A is contrasted to B as a different kind of use value. Only thereby can the concrete labor embodied in B express the abstract labor which constitutes the value of A. This is because the non-equivalence of the use values of A and B implies the non-equivalence of the concrete labors in A and B, leaving as a basis of equivalence only the fact that A and B were produced by human labor. B (a use value) becomes the form of appearance of A’s labor value because A relates to B as an immediate embodiment of abstract human labor. The labor that went into producing B is not taken as specific, goal-oriented productive activity, but only as a form of objectification or realization of human labor in general.

The natural form of A can express A’s use value, but cannot express its labor value. However, by A relating to B as an equivalent in the form, x of A = y of B, the natural form of B is made to express the labor value of A. In this relation, the concrete labor of B becomes an expression of abstract human labor. Thereby, abstract labor and labor value receive material expression in terms of concrete labor and use value. In contrast to the determination of use value and concrete labor, the determination of labor value and abstract labor can only take place within the relations of commodity to commodity, and that means within a social context in which commodities are exchanged. The theoretical concepts most central to Marx’s critique of capitalist production are thus results of capitalist praxis and are shown to be such by Marx’s theoretical practice.

The simplest forms of value of commodities, the simple relative and the simple equivalent forms, were given in the single equation which expresses the form of simple exchange, x of A = y of B. Economic science in the narrow sense is concerned with the quantitative relations of exchange value, costs, the ratio of x to y, price. This concern, however, presupposes that B has been determined as an equivalent which can be compared to A quantitatively in terms of a common denominator and (insofar as socially necessary labor time is taken to be at least one determinant of exchange value) economics presupposes that the concrete labor embodied in A and B can be determined as abstract human labor.

As a reflection upon these two presuppositions, Marx’s analysis of the form of value provides a theoretical basis for the substance of value (abstract labor) and the magnitude of value (labor time). But economics is concerned with the whole market of commodities and not with the case of the simple exchange of two commodities alone. Further, the market operates primarily in terms of monetary exchanges (not to mention such complications as stocks, etc.) rather than immediate exchange of commodities. The simple form of value must accordingly be expanded to account for the universal equivalence of all commodities with each other, the universal determination of all concrete labor as abstract human labor and the role of money in commodity exchange.

When commodity A enters the market, it sets itself in exchange relations with all other commodities. In addition to x of A = y of B, the following equations are also necessary to express the expanded form of value: x of A = u of C, x of A = v of D, x of A = w of E, and so on for all other types of commodities. Here the seemingly accidental relation of the two commodities A and B is replaced by a system of relations of value. It becomes clear in this form that the relations of exchange are determined by the relative magnitude of value, rather than value being determined by exchange. That is, the realm of production has a priority over circulation in that value is first of all a function of productive labor time and not primarily of supply and demand. Furthermore, this system of commodity relations provides a complete material expression for the abstraction of human labor.

In the simple form of value the concrete labor in A is explicitly set equivalent to the concrete labor in B and only implicitly thereby determined as human labor. Any other common factor would be purely coincidental since it is implicitly assumed that examples of commodities could be substituted for A or B which would not have the coincidental, inessential commonality. This implicit assumption is made explicit with the expanded form of value, in which A is related to every possible commodity and thus the labor in A is expressed as every possible kind of productive human labor and is thereby explicitly materially determined as abstract labor.

A further step in the development of the form of value is taken by reversing the equations of the expanded form. Clearly, if A can be exchanged for any other commodity than it is also true that any other commodity can be exchanged for A. The expanded equivalent or universal equivalent form of value, which states this, can be represented as: y of B = x of A, u of C = x of A, v of D = x of A, w of E = x of A, etc. Here all commodities express their value in the commodity A. Through A as a social expression of value, all commodities differentiate themselves as use values (expressed by their own natural form but not by A’s natural form) from themselves as exchange values (exchangeable with A). Transitively, as all exchangeable with A, all commodities relate to each ether as magnitudes of value, as qualitatively equal and quantitatively comparable. Here for the first time all commodities appear to each other as values, “Their value is hereby given its appropriate form of appearance as exchange value.”[12] That all commodities are (labor) values appears in the fact that they are all exchangeable with A. Their embodied abstract labor is expressed by the concrete labor embodied in A and their (labor) value is measured in terms of the quantities of A with which they are exchangeable.

Through a dialectical materialist analysis of the form of value of commodities, Marx has argued that the essence of the value of commodities is labor value and that its appearance is exchange value. This form of appearance is at once an expression of the essence and its obfuscation. The half-truth character of exchange value, its socially necessary falsehood, provides the basis for bourgeois ideology, with its doctrine of just exchange, its emphasis on the realm of circulation, its rejection of labor as the source of surplus value, its confusion of the private and the social and its distorted view of the nature of money. Marx’s analysis of abstract labor is a striking example of the dialectical and materialist character of his methodology, for he analyses the “universal,” human labor, as a relation between material entities (the commodities B, C, D, . . .) and, shows how it is materially expressed (in the universal equivalent, commodity A, which mediates all commodity exchanges by positing itself and all other commodities as objectifications of abstract labor). Rather than rejecting the power and dynamic of the abstract as e.g., non-empirical, Marx comprehends the life of the abstraction by focusing on its material expression. This task automatically subjects the ideal which is glorified by ideology to a critique in terms of its actual social manifestation. The analysis of the form of value also clarifies the role of money in the economy by showing its derivation from the simple form of value.

Money is the result of further transformations of the form of value beyond the form of the universal equivalent. In Capital, Marx uses linen as an illustration for commodity A, the universal equivalent. One could just as well use any other commodity as the material expression of labor values: corn, wampum, gold, silver, etc. Money is merely a symbolic representation of the material universal equivalent. In the form of paper money or bank balances, money is a “pure” expression of value in the sense that it expresses no use value. Its “purity,” however, helps obscure its social roots, its derivation from the simple form of value and its relation to concrete labor, to the organization of social production, to the producers. Money specifies a particular social form of exchange, even as it hides its socio-historical specificity.

Whether the universal equivalent is linen or money, it serves all other commodities as a universal corpus of value, a universal materialization of abstract human labor, a universal form of realization of universal labor. Insofar as all commodities reflect themselves as quantities of value in one and the same equivalent, they all reflect each other as quantities of value. The universal equivalent mediates the relations of exchangeability between all other commodities, so that in a monetary economy linen is not immediately exchangeable with coats the way each is with money: it they are exchanged, the one is sold for money and the other is bought with money.

The determination of a universal equivalent with which all commodities are immediately exchangeable is a social determination, as it must be valid throughout the commodity market: “In the form of exchange values, commodities appear to each other and relate to each other as values. Thereby, they also relate themselves to abstract human labor as their common social substance. Their social relation consists exclusively in being for each other nothing but quantitatively different, qualitatively equal, interchangeable and exchangeable expressions of this, their social substance.”[13] The form of exchangeability of commodities, their form of value, is their social form, because it is their value, their exchangeability, which sets them all in social rapport.

To analyze capitalist society, in which value is expressed as money, it is thus necessary to analyze the money form as a form of value and to show that the money form is socially specific by distinguishing it from natural forms (e.g. the use value of gold) and from forms of value in other social formations. This is the task of Marx’s critique of the fetishism of commodities.

Fetishism as Appearance and Reality

The form of value given by the equations of exchange between commodities is a form specific to an economy where social production is carried out by private labor. Commodities are products of mutually autonomous private labors, which, however, are interdependent in terms of a developed social division of labor. This interdependence is a function of the material differences between the products as use values. The products are not social values in the immediate sense of products of cooperative work, but are only determined as values through their relations to each other or, derivatively, to a universal equivalent. The commodity form of value is a mediated form of social value, to be contrasted both with non-social and pre-capitalist production and post-capitalist social production through cooperative association. The social form of commodities consists in their relations to each other, relations of identical human labor, relations of non-identical concrete labors in their abstractions as abstract labor. This relation of the products of labor to each other as products of abstract human labor defines the social form of labor specific to bourgeois (commodity) production.

One might object that all instances of labor by people in all societies have been instances of the general category (universal or abstraction), human labor. But Marx materialistically insists that the standard of “sociality” whereby the form of labor is categorized must “be drawn out of the nature of the characteristic relations of each mode of production and not out of conceptions external to them.”[14] The labor involved in producing a commodity is not immediately determined, as human labor, but rather as concrete labor of weaving, tailoring, etc. Only mediately, through the relations of exchange, is such labor determined as abstract labor by being set equal to the labor embodied in the universal equivalent. Wage labor, for instance, is abstract labor worth so much per hour when its concrete labor power is posited as relative to gold or wages. Labor, the activity of people in society, is interrelated in capitalist society through a highly developed network of productive specializations. However, this nexus of social relationships has a mediated form: it only comes to expression through the relations of exchange of the products of labor, the commodities. In particular, people’s social relations are expressed by the universal equivalent commodity or, as relations of wage labor to capital, interpersonal relations of productions are expressed in monetary terms.

The universal equivalent exhibits a tendency to conceal its origin in commodity relations, let alone in the social relations of the people who produce the commodities. This tendency towards a false appearance (falsche Schein) begins with the simple equivalent, B in the equation x of A = y of B. In the simple form of value, A takes the active role, setting itself equal to B. The character of equivalence that B has in the simple relation only as a result of this reflexive relation seems to belong to B “naturally.” It seems that A relates to B because B is a materialization of abstract human labor, something already present as a corpus of value. The illusion is, however, not yet complete in the simple form, because along with the tendency to attribute B’s immediate exchangeability to B as a physical characteristic independent of its relation to A is the opposing tendency to treat A and B as interchangeable by reversing the equation.

With the development of the form of value from the simple equivalent to the universal equivalent, the tendency for the underlying relations to be obscured is strengthened. The universal equivalent seems merely to be a “natural” expression of value because the opposed moments of this form of value no longer develop identically for the commodities which are related. The form is now an asymmetric many-to-one relation of all possible types of commodities to the single equivalent. This form distinguishes the universal equivalent as something entirely set apart from all other commodities. Further, the character of the universal equivalent is in fact no longer dependent upon its relation to any one other commodity and it therefore seems to be prior to and independent of each of the relations which determine it. The tendency of the universal equivalent to obscure its origin in the form of value and its nature as an expression of exchange relations and of the social relations which underlie exchange resulted in the myriad confused theories of money which Marx confronted.

The system of commodity production, in which money plays a well-defined role, is one possible means for relating the various specialized labors which take place in a technological society. People here relate their various labors to each other as abstract human labor by means of relating their products to each other as values. The social, inter-personal relation is concealed by the physical form of the commodities. In commodities, the substance of value (human labor) is no longer visible. In order to relate their products as commodities, people are forced to equate their labors with abstract human labor. The relations of commodities, expressed in money as the universal equivalent of all commodities, force this upon people regardless of what theories people may have concocted to explain the form of their activity. In a society of commodity production, the economic relations, which are after all results of human interaction, take over a priority and autonomy from people’s conscious intentions. In such a situation, economics forms a “base” underlying the “superstructure” of all attempts to comprehend and control economic forces.

Marx’s theory of capitalist society uncovers the determination of the magnitude of value by labor time as the secret hiding beneath the apparent development of the relative value of the commodity. It does this by showing how the form in which value appears in capitalist production forces people to equate their labors to abstract labor by equating all the products of labor to a universal equivalent which expresses the objectification of abstract labor. It is precisely this form of value which conceals the social relations of the private laborers and the social specificities of the private labors in objects rather than revealing them. The form of value which the product of labor takes in the historically-specific bourgeois mode of production, the exchange value of commodities, results in a fetishism of the products as things independent of social relations.

The mode of production analyzed in Capital is one in which private producers establish social contact with one another through their private products, through material objects. The determinations of social criteria for production, consumption and distribution are mediated by commodity relations. Consequently, rather than the social relations of products being and appearing as social relations of people at work, they appear as material relations of people or social relations of material objects.[15] The social relations of people make their appearance in the realm of material objects in a form which seems independent of the interpersonal realm. In analogy with religion, in which, according to Feuerbachian critique, social relations of people are worshipped as sacred entities in a heavenly realm prior to human society, Marx calls this apparent transference “fetishism.”

Marx goes beyond Feuerbach’s critique of religion by situating contemporary religious forms within the superstructure of commodity production. He argues that, “for a society of commodity producers, whose general social relations of production consist in relating to their products as commodities, thus as values, and in relating their private labors to each other in this material form as identical human labor, Christianity, with its cult of abstract man – namely in its bourgeois development, Protestantism, deism, etc. – is the corresponding form of religion.” Against Feuerbach, Marx insists that an intellectual criticism of religion, especially an argument which itself adopts a cult of abstract man and which fails to situate religion in a social context, cannot be effective. As early as in his fourth “Thesis on Feuerbach” Marx had pointed out that a prerequisite to defeating religion was the removal of its original social motivation.

In Capital, Marx has precisely located the origin of religious fetishism along with fetishism of commodities in the cult of abstract man and abstract labor, which mediate social relations under capitalism. Religion cannot be abolished without eliminating commodity fetishism. The latter can only disappear once the form of value is transformed into a social structure which does not obscure the social, interpersonal relations of production. This is tantamount to a call for the overthrow of wage-labor and commodity production. It should, incidentally, be clear that Marx’s position is forcefully opposed to any cult of abstract man, including the “humanism” Heidegger tries to saddle him with. Capital, Marx’s mature theory, which was at least implicit in his earlier Manuscripts, does not object to alienation on the basis of some idealistic conception of the nature of man. It reveals the process whereby the social relationships, which in every society determine the form of human potential, are alienated from people through the fetishism or commodities. The economic basis for this development is given by the form of value of commodities as exchange value. This form of value is due to the relation of the worker as wage laborer to the capitalist as owner of the produced commodities.

Although abstract human labor is the substance or essence of value in bourgeois society, the form of value taken by this essence, the form in which it manifests itself in appearance, is exchange value. This appearance is not an arbitrary lie, but a socially necessitated illusion. As part of his analysis of the essence of (labor) value, Marx was thus obliged to analyze the form of material expression of this value in the exchange value of inter-related commodities. This analysis of the form of material expression of value, was, in fact, Marx’s major contribution to the theory of labor value, combining classical political economy’s concern with the appearance of exchange value and proletarian ideology’s insistence on the essence of human labor value.

Such a unity of theory and practice within the concerns of social theory is necessary if social theory is to contribute effectively to the transformation of capitalist society. Social reform is objectively impossible under advanced capitalist society. The contradictions of capitalism do not make reformation easier, rather, they infect any attempts at change, distorting and strangling them. Surely any action against the social system which unknowingly adopts that very system’s ideologies (e.g. a naively moralistic demand for equality based on the cult of abstract man) without subjecting them to social critique is doomed from the start to fail in its simplistic objectives. The failure of reforms is today attributed to “cooptation” and not to a lack of theory, however.

Cooptation can, nevertheless, be comprehended within Marx’s theory of capitalist society. A reform is undertaken on the basis of its inherent or essential qualities as perceived abstractly. When the reform is put into practice, however, it is mediated by its social context, by all the other existing criteria which also condition its object. The aided reformist criteria interact with the pre-existing social criteria to develop qualitatively new and unexpected effects. Thereby, something which may “work in theory” may not have the anticipated results in practice. This is particularly true in the context of bourgeois social relations, where essential determinants are obscured and distorted. The appearance created by the effects upon reforms due to pervasive commodity relations and the consequent obfuscation of commodity fetishism tend to result in cooptation. The attempted reform is transformed under the commodity form of relations. The relation of the conscious reformers to their intended reform is obscured and takes on the apparent form of a relation of “the owners of capital” to a reform which has been altered to serve their interests. The apparent benefactors of the distorted reform need not be identifiable, they need not exist as individual people. The reform has simply been made to serve the criteria of exchange value or capital and the human agents presumed to be behind this fetish are invisible, autonomous, abstract, indefinable: the System, the Man, the They, the Power Elite.

Abstract moralism and purely practical power politics fail equally to challenge the status quo if they do not reflect upon the ways in which reforms are mediated by their form of material expression in the given social context. Because the various determinations interact in opposing ways and develop beyond their original forms, the materialistic analysis of the form of appearance or the essence must be dialectical. It must, furthermore, be informed by an historical sense, both of the continuous social dynamic and of differing historical forms as various possible forms of appearance of a particular essence.

Idealism and empiricism, theory without concern for practical expression and the acceptance of appearance without comparison to essence are both ideological, uncritical. They are instances of the one-dimensional thought which corresponds to bourgeois society without being able to transcend it.[16] Marx’s presentation of an analysis of capitalist society in Capital, on the contrary, unifies the theoretical and the practical within theory, thereby penetrating for any political practice which it informs the illusions generated by the fetishism of commodities.