[All page references refer to the unabridged Penguin Edition]

Introduction

1. Production, Consumption, Distribution, Exchange (Circulation)

(1) Production

Independent Individuals, Eighteenth-century Ideas

83 Begins with a dismissal of the accounts of political economy provided by bourgeois economists who imagine political economy as functioning in the same way as it is represented in Daniel Defoe’s novel Robinson Crusoe, as though its basis is the autonomy of the individual.

84 Looking at history the fact that the individual belongs to a far larger social totality is obvious; it is only in the eighteenth century, when production and social relations reach an advanced stage that civil society arises and individuals begin to confront sociality as a means to their own end.

85 Considering production therefore requires us to investigate its historical forms; each epoch does have characteristics in common, but production in general is an abstraction it is conducted by social individuals.

86 Production is therefore not confined to a specific sector of production, it is a broader social occurrence, it forms a totality.

This broader social metabolism within which production occurs is ignored by political economists such as John Stuart Mill and Adam Smith.

87 This means their works digress into tautology; claiming that certain races, locations, climates or natural conditions are more advantageous to production than others amounts to nothing more than asserting that wealth is more easily created where it exists to a greater extent.

The aim of bourgeois economists is to present production as though it abides by eternal and natural laws which act independently of history, allowing them to smuggle bourgeois ideology into the picture, under the guise of scientific analysis.

Definition: production is the appropriation of nature on the part of an individual within and though a specific form of society.

In this sense it is a tautology to say that property is a precondition of production. The conceptual leap here is that private property or bourgeois law is a pre-condition.

88 Historically it is common property that is the more common form, in ancient or tribal societies.

In production members of society shape the products of nature in accordance with human needs.

89 Production creates the objects, distribution divides them according to social laws, exchange parcels out the divided shares according to individual needs, in consumption the object’s presence in a social movement ends and becomes a direct object and servant of individual need.

Production is the point of departure, distribution and exchange the middle and consumption the conclusion.

Distribution and exchange are themselves twofold since distribution is determined by society and exchange is conducted by individuals.

The person objectifies himself in production, the thing subjectifies itself in the person. In distribution society mediates between production and consumption in the form of general, dominant determinants and in exchange the two are mediated by the chance characteristics of the individual.

Production is the generality, distribution and exchange the particularity and consumption the singularity in which the whole is integrated.

90 Production is also consumption. The individual not only develops his abilities in production but also expends them, uses them up in the act of production, just as natural procreation is the consumption of life forces.

The means of production and raw materials are consumed in their use and dissolved into their elements again; this is productive consumption.

91 They are the same, but at the same time a mediating movement takes place between the two. Without production consumption would lack an object.

Distribution and Production

95 Bourgeois economists separate production from distribution; ground rent, wages, interest and profit are seen as belonging solely to distribution while land, labour and capital appear as agents of production.

As such they are posited multiple times; as agent of production, as source of income and determinant of specific forms of distribution

Interest and profit are also figured as agents of production in the sense that they are forms in which capital increases. Interest and profit as forms of distribution presuppose capital as an agent of production.

Similarly, distribution appears merely as the obverse of the agents of production whereas distribution is itself a product of production.

97 - 8 Deals with various historic phases through which production has proceeded, the point of which is that production is not new, nor it is wedded to industrial production, the mode of pillage for example is determined by the regnant forms of production.

Circulation is a specific moment of exchange, and it is also exchange in its totality.

99 Exchange appears independent of and indifferent to production only in the final phase where product is exchanged for consumption.

But there is no exchange without division of labour; private exchange presupposes private production. The intensity and speed of exchange, its velocity, are determined by the development and structure of production.

These are not identical, but they all form members of a totality, they are distinctions within an overarching unity.

Production predominates, not only over itself, in the antithetical definition of production, but over other moments as well; the process always returns to production to begin anew.

(3) The Method of Political Economy

100 Economists in the seventeenth century always initiated their studies by living wholes; population, nation states, groups of states, and conclude by their analysis with a series of abstractions, general relations such as divisions of labour, money, value, etc.

As soon as these individual moments had been firmly established and abstracted economic systems developed, which ascended from the simple relations.

101 These were labour, division of labour, exchange value, to the level of the state and exchange between nations.

The concrete is the concrete because it is the coming together of many determinations, it is unity of the diverse. It appears in the process of thinking as a result, not as a point of departure.

The incorrect method would be to begin with the abstractions. This was Hegel’s mistake, conceiving the real as a product of thought conceiving itself.

102 - 5 Considers the role of categories such as possession, labour and money in their historical context to demonstrate that their validity consist only for and within these relations.

Bourgeois society is the most developed and complex historic organisation of production and it therefore allows insights into preceding social formations, but bourgeois economists only view their object of consideration from one point of view.

107 Under the feudal mode of production capital possesses a landed-proprietary character, with the exception of artisanal or handicraft production in the cities. In bourgeois society the opposite happens and agriculture becomes increasingly a branch of industry.

110 - 111 Insanely good series of riffs on culture and production; cf. Hegel’s aesthetics.

The Chapter on Money

115 Series of critical notes taken on Alfred Darimon’s On The Reform of Banks (1856)

Criticises Darimon for misunderstanding the amount of bills in circulation as identical with the requirements of circulation, arguing that the quantity of discountered bills and its fluctuations express the requirements of credit.

116 Attributes this mistake to his being a Proudhonist; the data he presents with one column indicating the amount of gold in a bank and the amount of bills issued by that bank only indicate that a banks portfolio filled up with bills of exchange and its vaults emptied oof metal in proportion as bills of exchange were presented to it for the purpose of withdring metal.

117 - 8 The real finding is that the metal assets of the bank and the securities are out of proportion with one another and that different observations; one increasing while the other decreases and vice versa, requires different explanations.

119 In 1855 the Bank of France saw its gold diminish by 44 million and its portfolio increase by 101 million. It therefore adopted a set of measures to defend its vaults against its portfolio by reducing the time of payment of bills presented for discount from 90 to 75; in doing so it raised the terms on which its metals were available to commerce; Darimon misreads this as the bank withdrawing its trade in gold and silver at the time when the public needs it.

120 - 1 Marx accuses Darimon of not understanding the economic laws which govern what the banks actually do and why they do it; what happened was an outcome of a broader balance of payments crisis which related to broader occurrences in the economy; it had nothing to do with the banks acting autonomously against the public interest.

122 Darimon’s erroneous conclusions arise from the Proudhonist focus on methods of distribution rather than the broader productive apparatus of which it is a part.

123 Scarcity of circulation is both an effect and cause of the accumulation of capital more broadly; expecting that money, whether it supposedly claims to represent labour or not, can perform their function without suspending the function of money is contradictory; wage labour is at the core of this antagonism.

Great line: ‘The notion of crédit gratuit, incidentally, is only a hypocritical, philistine and anxiety-ridden form of the saying: property is theft. Instead of the workers taking the capitalists’ capital, the capitalists are supposed to be comeplled to give it to them’.

124 - 6 Darimon believes that the mere form of currency, gold and silver, are at the root of the problem; if all commodities could be made instruments of exchange on an equal footing periodic commercial crises could be averted: ‘Let the pope remain, but make everybody pope’.

127 The capitalist mode of production requires a means of exchange that can serve as a repository and representation of value. Some of these instruments of exchange may be more or less convenient than others, but it is still required in its essential form or function.

128 - 9 A drain in precious metals from the banks may be caused by a food shortage such as the failure of the grain crop; this would require increased purchases of foreign grain from overseas. This drain would be caused by a shortage of grain however, and not by the drain of precious metals, although this may aggravate it.

It is not the case, as Proudhon claims, that gold and silver are the only authentic repository of value in contrast to other commodities. This can be seen in the outlined example, the rise in grain prices means that more gold and silver has to be spent on grain imports; the price of gold and silver has obviously declined relative to grain here, no privilege insulates them.

130 This is not a one-to-one relationship, the depreciation of all other commodities relative to grain is greater than the relative rise in grain prices, although there are also instances in which the depreciation does not occur; Marx notes industrial goods as an exception of recent years.

The export of gold cannot be blamed for the crisis; this reduces it to one of supply and demand, which is only relevant within the sphere of primary need.

The roles of gold and silver in economic crisis take place in two ways:

i) when the export of gold is made more difficult due to the restrictions visited upon the banks viz. the export of gold impact disadvantageously on national circulation ii) when the export of gold is necessary because foreign nations will not accept anything else

131 As soon as a note representing five pounds of gold is no longer convertible into gold a contradiction between the price of a note and the price of gold asserts itself. The point in dispute among economists is not the convertibility itself but how it is to be enforced; either by law or by the bank.

132 Convertibility into gold and silver is the practical measure of a currency, nominal value is an abstract relationship, convertibility demonstrates is the test.

133 Paper money is preferred in Scotland which is why it never followed England into monetary crisis despite it following England into every other type of economic crisis.

134 Darimon and his followers mistake the fact that gold is in certain jurisdiction the value repository of last resort for its being an authentic store of value; they miss gold’s depreciation relative to other commodities.

The real answer to the contradiction is to abolish prices by doing away with exchange value, which is a fundamental component of the bourgeois mode of production; whether money is apportioned out on the basis of the exertion of labour hours or not.

135 The fact that it is convertible will result in a situation where it appreciates or depreciates relative to other commodities; it is not the amount of labour time that determines value but the amount of necessary labour time; a time-chit representing hours of labour would only remain stable if productivity was constant, but in reality, it is always subject to change.

137 The value of all comodities is determined by the labour time required to produce them. Their price is this exchange value expressed in money.

Proudhon’s proposals seek to equate price and value but the value of commodities expressed by labour time is thier average value, which is an external abstraction calculated out as the average price of an epoch.

It is still the driving force of commodity markets and the dynamic undergirding oscillations in price and value in exchange despite it being abstract and neither is its actuality irrelevant; it determines speculation on mercantile markets mercantile speculation because the market value is always different, is always above or below this average value of a commodity

Market value equates itself with real value by means of constant oscillations never by means of an equation with real value but by means of non-equation of itself; the two never balance out, or only do so incidentally but value is nevertheless the law the former runs through.

138 Supply and demand determine the price of a commodity, they never balance, or only do so coincidentally; but the cost of production determines the oscillations of supply and demand.

Proudhonists imagine they are abolishing the contradiction between value and price by expressing value in units of labour time.

139 It simply would not function as a convertible currency as the depreciation of commodities arises out of the law of the rising productivity of labour time.

140 Because price is not equal to value, labour time cannot be the element in which prices are expressed; in that case labour time would have to express itself simultaneously as the determining and the non-determining element; labour-time exists only as an ideal it cannot serve as a means of price comparisons.

141 All commodities are qualitatively equal and quantitatively distinct, hence they can be measured against each other and substituted for one another in certain quantitative relations.

Value is what renders them commensurate.

142 Their exchange value expresses the extent of its exchangeability; money is the store of value in which all commodities can equate, compare and measure themselves. This is expressed via comparison, e.g. 1 unit of cheese = 2 blocks of wood

This process abstracts from the commodities concrete, real aspects; this is a contradiction.

143 This exchange value also expresses the amount of labour power congealed in the commodity.

144 Though it is straightforward to express commodities in terms of each other ideally, exchange itself is a real process and has to proceed through a determinate set of stages; it requires a third term, in the form of money, the symbol of the commodity as a commodity, the commodity’s exchange value itself which represents labour time as such.

This is a social symbol, it expresses nothing more than a social relation.

146 Money is i) a measure of commodity exchange ii) a medium of exchange iii) a representative of commodities iv) a general commodity alongside particular commodities.

By being a general commodity in relation to all others, it becomes the realised and realisable form of capital; the form of calpital whic is always valid.

As productive relations develop an production becomes increasingly social money also dvelopes and exchange becomes a process in itself, the gap between the product as a product and the product as exchange value widens. Money does not drive this process forward, it is the development of these contradictions and antitheses.

148 Just as the commodity leads a dual existence as a particulary commodity and as money so does the act of exchange split into two mutually independent acts; exchange of commodities for money, exchange of money for commodities.

In this way purchase and sale are non-identical acts, they have achived a spatial and temporal existence which are separate from one another; this creates the opportunity for them to enter into disproportion with one another, it is a source of contradiction.

These acts are also increasingly sepaate from the producers of commodities; exchange for the sake of exchange becomes the driving force rather than exchange for the sake of use; this is the development of mercantilism, an estate which buys in order to sell and sells in order to buy in order to accumulate more money; this can also arise under barter, but with less importance.

149 This is the origin of commercial crises.

Money overcomes the difficulties of barter by universalising them.

150 Two of the limitations which assert themselves in crises include i) the fact that commodities are still bound by their concrete aspects; they are prone to deterioration ii) they are connected with the immediate need which another may have or not have at the time.

A contradiction contained in the nature of money is that it comes up against its limitations as universally exchangeable by virtue of being a particular commodity.

151 In this way it is an inherent property of money to fulfil its puspoese by negating then; to achieve independence form commodities, to be a means which becomes an end, realise the exchange value of commodities by separating them from it.

153 - 4 Example of how the value form remains in place even when time-chits are used as currency; if it doesn’t serve as objectified value it isn’t money.

156 Price and exchange extend back into pre-history but under bourgeois capitalist society costs of production and the predominance of exchange over price govern society to a far greater extent.

Bourgeois economists claim that all individuals pursuing their own private interests serve the totality of interests; Marx makes the point that this could as easily amount to a war of all against all, but makes the point that private interest is itself already socially determined and can be achieved only within the conditions laid down by society and with the means provided by society; it is bound to the reproduction of these conditions and means.

157 This is obviously a significant transformation from a previously regnant mode of production in which an individual naturally reproduces themselves; under capitalism the social character of production renders private interest subordinate to relations which subsist independently of them; as an alien thing; the less social power the medium of exchange possesses - under feudalism, in antiquity, under the guild system - the greater the power of the community which binds the individuals together.

158 Relations of personal dependence are the first social forms within which human productive capacity first develops. Personal independence founded on objective dependence is the second form; it is at this point that a system of general social metabolism first develops. Free individuality, based on the universal development of individuals and on their subordination of their communal, social productivity as social wealth is the third stage.

Patriarcak as well as ancient conditions disintegrate with the development of commerce, luxury, money and exchange value while modern society grows in the same measure.

The necessity of transforming individual products and activities into exchange vlue and money so they demonstrate their social power in an objective form proves individuals produce only for society and in society that production is not directly social, rather than individuals are subsumedunder social production, which exists outside them as their fate, social production is not subsumed under individuals and managed by them as their common wealth.

159 the private exchange of all products of labour stands in antithesis not only to a disribution based on a naturla nad poliitcl super and subordination of individuals based on a natural and political super or subordinations of individuals to one anoher but also to free exchange among individuals who are associatied on the basis of common appropriation and control of the means of produciton.

Just as the divisin of labour crates antithentical forms of unity which bring the antithesis to the fore, agglomeration combination copopertion and the antithesis of private interests, sod oes private exchange create world trade, private indepenendence creates complete dependednce on hte world market and fragmented acts of exchange create a banking and credit system whose books keep a record.

A mass of antithetical forms of the social unity whose antithetical character can never be abolished through quiet metamorphosis,

160 - 1 the autonomisation of the world market would seem to increases the development of monetary relations and vice versa and as the general bond and overall interdependence in production and conumsption increase with the independence and indifference of consumers and producers to one another and this contradiction leads to crisisl institutions eemrge whereby each individual cn acuire informnation about the activity of all others anad attempt to adjust tehir wn accordingly; lists of curernt prices, rates of exchange, interconnections through those active in commerce through means of communication (Marx uses this to point to the ways in which, though supply and demand are independent of the actions of any one individual, everyone attempts to inform himself about them and this knoweldge reacts back in practice to supply and demand themselves) this holds out the possiblity of socialising production and exchagne.

162 the indpeendent function of this system certainly renders it more productie and progressive than feudalism but it would be facile to regard it as natural or spontaenous; it is an historic product; it is the bond natrual to individuals within a specific and limited relation of production; they are not products of nature but history.

In earlier stages of production it might appear that the individual is developed more fully because they have not yet worked out their relationships in their fullness or or ereticed them as independent social powers and relations opposite themselves; but it is reactionary and impossible to yearn for their restoration, the bourgeois viewpoint has never advanced beyond this antithesis and this romantic viewpoint.

163 In underdeveloped productive regimes such as feudalism, relations appear to be personal, but only happen between individuals imprisoend within certain definitions or estates, such as feudal lord, vassla, landlord or serf. Under capitalism these ties are exploded and individuals seem independent, but this is illusory.

164 In this sense individuals are ruled by abstracitons, which are the theoretical expressions of the material relations.

165 Important to remember that under feudalism these relations took on an objective character within their own sphere, for example the development of landed propreitarship out of military subordinations proprietorship .

166 Under feudalism objects which have the most use serve as currency; hides or slaves, while under a society governed by the requirements of exchange precious metals serve as currency precisely because of their less utility as an object of consumption or instruemnnt of production.

167 the proportiion in which a particular commodity is exchanged for money, is determiend by the amount of albour time objectified in thecommodity, the commodity is an exchange value because it is the realisation ofa specific amount of labour time; every commodity is continuously exchange for labour time within production; the necessity of money other than labour time arises because the quantitty of labour time must not be expressed in its immediate, particular product but in mediated geenral product.

168 The objecitification of hte general social characer of labor is precisely what makes teh product of labour time into exchange value; this is what gives the commodity the attributes of money.

173 How livestock functons as a measure before it becomes a medium of exchange in antiquity because in barter each commodity is sitll its own medium of exchange, but it cannot be its own measure.

174 - 185 series of notes on the distinct physical properties of precious metals and their uses across distinct stages of social development.

188 - 91 A mediation is required for a commodity to be posited as exchange value, in the form of price. Once this mediation is achieved, price has achieved a form of existence separate from the commodity; it is the commodity in an ideal form.

193 A developed system of prices presupposes the individual no longer directly produces his means of subsistence, but that his direct product is exchange value and must first by mediated as a social process.

In purchase and sale this ideal transformation becomes actual and a particular exchange value must be exchanged for exchange value in general. The commodity is realised as an exchange value only through this mediating movement in which money plays the role of a middleman; it circulates in the opposite direction from commodities.

194 The point here is that realisation, purchase and sale are all non-identical acts.

What money circulates is not commodities but titles of ownership.

What is realised is no tthe commodities but their exchange value in the form of price.

We have already noted that the quantity of money which is in circulation is determined initially by the prices of the individual commodities and secondly by the quantity of commodities at given prices which enter into circulation; the amount of money required is dpeendended on the level of commodity prices and the quantity of commodities at specified prices as well as the rapidity with which money circulates or completees the task of realisation.

If 1 thaler in one hour makes 10 purchases at 1 thaler each, if it is exchanged 10 times it performsthe same task that 10 thalers would do if they made only 1 purchase per hour.

195 No matter how many ebbs and floods this quantity of the circulating medium is exposed to an average level always comes into existence, since the permanent changes are always very gradual, take place only over longer periods.

198 If the commodity cannot be realised in money it can no longer circulate and its price becomes merely imaginary. It then devaluates.

199 As production becomes less oriented towards immediate subsistence an agent of circulation which can serve as a store of value becomes increasingly important.

200 Exchange being split into purchase and sale, making them non-simultaneous acts, renders it possible for one to buy without selling (accumulate commodities) or sell without buying (accumulate capital). This turns exchange into a specialised activity; it results in the creation of a merchant estate.

201 The two distinct types of circulation, which each proceed through three non-identical moments:

i) Commodity -> Money -> Commodity ii) Money -> Commodity -> Money

In situation i) one sells a commodity in order to get money to get another commodity.

In situation ii) one begins with money, to buy a commodity to sell it for more money.

There is a specific distinction between a commodity in circulation and money in circulation; a commodity fulfills its function by dropping out of circulation, money remains in circulation perpetually.

202 Exchanging a commodity for another commodity makes sense as individual commodities fulfill specific qualitative functions. Exchanging money for money only makes sense if there is an increase in the amount acquired.

203 In this way money serves a function that goes beyond its serving as a repository of value and a medium of exchange; it becomes a measure of wealth and an end in itself.

206 The two commodities being exchanged, the gold for the e.g. bushel of wheat, have nothing to do with one another other than the congealed labour time which render them commensurate.

213 As the total sum of prices to be realised in circulation changes with the prices of the commodities and with the quantity thrown into circulation and since the velocity of the medium of exchange is determined by circumstances independent of itself, it follows that the quantity of media circulating must be capable of changing, expanding and contracting.

In its role as a medium of circulation it can be said that money ceases to be a particular commodity when its material is irrelevant and it meets only the needs of circulation itself and no other direct need; gold and silver cease to be commodities as soon as they circulate as money.

222 On how the social form of money facilitates and encourages its accumulation, how greed is the product of a definite social development.

223 The full development of money necessarily represents the antithesis of the social bonds observed in antiquity; in these periods of history the greed for accumulation can be observed only in the merchant estate; only with the Greeks and Romans does money appear unhampered in its first two functions, as measure and medium of circulation. But as soon as trade develops or conquest brings money in vast quantities, money sppears in its third role and the further it does so the more the decay of their community sets in.

In order to function productively money must be not only the precondition but also the result of circulation; as the Romans acquired money through plunder, this was not the case.

It is inherent in hte simple character of money itself that it can exist as a development moment of prodcution only where and when wage lbour exists, and rather than representing a subversion of the social formation in this case it is a condition for its development anda driving wheel for the development of all forces of production.

The dissolution of this individual within modern society is in itself only the enrichment of the productive section of society. The owner of money, in the ancient sense is dissolved by the industrial process.

224 ‘Where money is not itself the community it must dissolve the community’

[Slavery]

In antiquity one could buy a slave but the slave could not make money through his labour. Makes the argument that black slavery ‘a purely industrial slavery’ is incompatible with the development of bourgeois society and disappears with it and that it presupposes wage labour; if other free states with wage labour did not exist alongside it all social conditions there would immediately return to pre-civilised forms.

225 The period which precedes the development of modern industrial society opens with a general greed for money on behalf of individuals and nation states; the real development of the sources of wealth take place behind their backs as a means of gaining possession of the representatives of wealth.

Wherever it does not arise out of circulation, as in Spain, but has to be discovered physically, the nation is impoverished, while the nations whcih have to work in order to get it from the Spaniards develop the sources of wealth and really become rich.

[Transition to capitalism]

This is why the search for and discovery of gold in new continents, countries, plays so great a role in the history of revaluation, because by its means colonisation is improvised and made to flourish as if in a hothouse. The hunt for gold in all countries leads to its discovery; the formation of new states; initially to the spread fo commodities, which produce new needs, and draw distant continents into the metabolism of circulation, i.e. exchange. This, in this respect, as the general representative of wealth and as individualised exchange value, it was doubly a means for expanding the universality of wealth, and for drawing hte dimensions of exchange over the whole world; for creating the true generality of exchange value in substance and in extension’

227 Historical material on gold and silver in the Americas.

230 Under feudalism and antiquity the accumultion of wealth was undertaken solely for the purpose of possessing wealth as such, a display of overabundance, to finance public works and to gift to gods in temples or security in cases of extreme need to buy arms.

Later in antiquity accumulation becomes political, a state treasury develops and the temple is the first place this is placed.

232 Historical material linking Protestantism with deflationary spending

The Chapter on Capital

239 The difficulty in grasping money in its fully developed character is in its character as a social relation, it is at once a defined object made of metal or stone and a social relation.

240 It is the most consummate form of exchange value.

Some social reformers have therefore posited that it be made a direct representation of labour-money. This would fail to overcome the nature of exchange value; as long as opposition to the present form of social relations develop the social forms which arise under capitalism transform themselves, this is why social reformers have proposed this programe. But tinkering with the money-form in isoaltion won’t resolve these contradictions.

241 One of the most important functions of money is to render all commodities commensurate with one another, as commodities consist of exchange values, they become equal to one another.

243 The capacity to satisfy mutual needs, a recognition of common species-being and forms of social life which depend on it is what distinguishes man from the rest of the animal kingdom.

244 But in exchange society this reciprocity is not the real form of the exchange, the common interest which appears as motive, rather it takes place behind the back of one’s individual interest.

245 Consideration of this as a social form in history and how voluntary exchange was not present in antiquity or in medieval society.

248 Bourgeois economists overlook these aspects of the process and focus instead on the simplest forms of exchange, the fact of labour and capital acting within them, and incorrectly emphasise the freedom or mutual interest that subsist within them.

251 Capital is money at a higher stage of social development.

252 In prior societal modes, this order may be reversed, and a less complete development of value, as in social syswtems based on landed property may be the result. These prior systems are a predicate, a necessary stage of a contemporary system based on capital.

Studying the system of landed property reveals the gradual transforation of the feudal landlord into the landowner, the unfree tenant becoming the modern farmer and the serfs, bondsmen becoming agricultural day-labourers.

253 Capital comes initially from circulation and its point of departure is money. Money which enters into circulation and at the same time returns from it to itself, it negates itself as something which merely dissolves in circulation but equally negates itself as something which takes up an independent attitude towards circulation. This negation, contains the first elements of capital.

Commercial capital, or circulating capital, is the first form of capital, at which point it is not yet the foundation of production. A more developed form is money capital or money interest, urusy, whose independent appearance belongs also to an earlier stage.

The form C-M-M-C, in which money and circulation appear as mere means for the circulating commodity, which steps outside circulation and satisfies a need, this is teh presupposition of that earlier stge of merchant capital.

254 The simple movement of exchange values, as in pure circulation, can never realise capital, it can lead to the withdrawal and stockpiling of money, but as soon as money steps back into circulation, it dissolves itself in a sieres of exchange processes with commodities which are consumed, since it is lost as soon as its purchasing power is exhausted.

Circulation therefore does not carry within it the principle of self-renewal.

255 Commodities are the realisation of definite labour time and are as such values; their presupposition is both the production of commodities by labour and their production of exchange values.

258 Capital is therefore not a sum of values but a process.

259 As soon as money is posited as exchagne value which not only becomes independent of circulation but maintains itself through it it is no longer money but capital.

260 - 2 Series of notes and reflects on the jettisoning of particularity when exchange is understood in the totality and in abstract terms.

263 The important point to underline here: the means by which capital becomes a process, rather than a tangible thing, and within this process labour too is objectified in the process of its reproduction.

266 Introduces the notion of labour and capital as antagonistic, one being alien to the other; in the first positing of simple exchange value labour was structured in a way that the product was not a direct use value, not a means of subsistence, but it is teh requirement of exchange.

267 The use value the worker offers the capitalist is not materialised in a product, does not apepar as apart from him, it exists as potential, as a capacity.

It becomes a reality only when it has been solicited by capital.

268 - 9 Criticises bourgeois economists whose fundamental criterion is the notion of utility since use is subordinate to exchange in capitalist society and stands in no relation to the substance to such.

270 Since value has become independent in the form of money it is inherent to its nature to drive beyond its own value. Value preserves itself through increase and does so by constatnyl driving beyond its own quantitative barrier; increasing wealth is an end in itself.

272 On that basis, the only important use value for capital is labour, and productive labour, as opposed to the provision of services, which is the consumption of revenue and exists within simple circulation: ‘From whore to pope there is a mass of such rabble’, as well as the lumpen-proletariat, ’the great mob of porters…who render service in seaport cities’.

273 Workers are productive insofar as they increase the capital of their master, unproductive as to the material result of their labour.

274 The worker sells his commodity, labour, which has a use-value and also a price, like all other commodities, for a sum of exchange values.

The capitalist obtains labour as value-positing activity, as productive labour, he obtains the productive force whcih maintains and multiplies capital and which thereby becomes the productive force, a force belonging to capital itself.

These two processes are separate. They can take place at different times and they need not coincide. The first process can be and usually is completed before the second even begins. The completion of the second act presuppose the completion of the product. The payment of wages cannot wait for that.

276 Capital is the creator of modern landed property or ground rent; just as its action therefore appears also as the dissoluton of the old form of property on land. Capital is therefore the creatior of modern agriculture.

Once wage labour is created the propreitor clears the land of excess mouths and transforms labour on teh soil itself into a mediated source of subsistence. Only then is the application of science possible and the full forces of production unleashed; industrial development becomes possible.

277 Wage labour in its classic form is something permeating the entire expanse of society is therefore created by modern landed property.

Merchant capital can emerge without this transformation taking place, but not industrial capital; even the development of manufacture requires this to happen.

Only with the development of modern industry t a high degree does this dissolution at individual points acquire its totality and extent, but it occurs more rapidly to the degree that modern agriculture and the form of property have developed.

Similarly, if the first form of industry, large-scale manufacture presupposes dissolution of landed property, this dissolution is conditions by the subordinate development of capital in its primitive medieval forms which has taken place in cities and at the same time the effect of manufacture and trade flourishing in other counries, the example offered is the influence of Holland on England in teh sixteenth and the first half of the seventeeth century; these counries had already undergone the process, agriculture had been sacrified to cattle-raising and grain was obtained from those countries which had been developmentally outstripped, such as Poland.

278 While in the bourgeois system every economic relation presupposes every other and everyting posited is thus also a presupposition this is the case with every organic system, which, as a totality, has its presuppositions; its development in its totality consists in subordinating all elements of society to itself, or creating out of it the organs which it still lacks, this is how it becomes a totality.

If, within one society, capital seizes conrol of the relations of production and develops productive forces to their totality this society seizes control of another, e.g. colonies then its representative, the capitalit, finds that his capacity ceases to be capital without wage labour and that one of the presuppositons of teh latter is not only landed property in geenral but modern landed property, which as capitalised rent, is expensive and whcih, as such, excludes the directuse of the soil by individuals.

Hence colonisation; landed property is here artifically made more expensive to transform the workers into wage workeers, make capital act as capital and to make the colony productive, to develop wealth in it, instead of using it for the momentary deliverance of the wage labourers as in America.

279 - 281 Notes on colonies and the world market.

282 The wage system gives the impression that the worker has a share in the product; if the worker receives money, exchange value, the geenral form of wealth he has received a greater or lesser share in the value of the product he produces, but the exchange value of his commodity cannot be determined by the manner in whcih the buyer uses it, only the amount of objectified labour contained in it, by the amount of labour required to reproduce the worker himself, the use value he offers exists only as an ability, as a capacity of his bodily existence, it has no existence apart from that.

283 The appropriate measure of teh amount of value, the sum of money, the woker obtains in exchange is the objectified labour necessarily bodily to maintain the general substance in whcih his labour power exists but also that required to modify this general substance so as to develop its particular capacity.

The worker’s life is the source in which his own use value constantly re-kindles itself up to a certain time when it is worn out and constantly confronts capital again in order to begin the exchange anew.

Since he exchanges his use value for the general form of wealth he becomes co-participant in general wealth up o the limit of his equivalent; a quantitative limit which turns into a qualitative one, as in every exchange.

The worker is distinct from the slave in the sense that the sphere of his consumption is not qualitatively restricted but quantitatively except insofar as the qualitative is posited through the quantitative.

284 Because the worker receives the equivalent in the form of money, there is a semblance of equality with the capitalist; but this semblance exists as an illusion on his part; what he obtains from the exchange is not wealth, but a means of subsistence, objects for the peservation of his life.

285 It is theoretically possible for the worker to use their wages to accumulate wealth; bourgeois economists issue apologia for exploitation along these lines, calling on the owrkers to practice self-denial, there is some notion that this is what capitalists have done in order to accumulate their wealth. This is of course an exception to the relation.

286 If as a class workers succeed in raising their general level of industriousness they increase not the value of the commodity but its quantity; if they all save, a general reduction of wages would reduce their conditions once again, for general savings would demonstrate to the capitalist that their wages are too high, that they are receiving more than its equivalent for their labour.

An individual worker can be more industrious on average, more than he has to be in order to labour, only because another, in the average, works less. The most he can achieve on the average is to be better able to endure the fluctuations of prices; he can manage his consumption better, but never attain wealth; the capitalists demand that they always hold a minimum of life’s pleasures to make crises easier to bear for the capitalist.

288 If the worker is to ameliorate their station through accumulation via savings at a certain point the saved-up money has to become capital, establishing at another point the contradiction that bourgeois philanthropists are seeking to overcome.

Notebook III

294 What the struggle for reductions in the working day provdes is that the capitalists prefers for the worker to squander their dosage of vital force as much as possible without interruption.

No wealth is created in exchange, either for the capitalist, because for the latter the payment of money is a sacrifice of wealth not its creation, for whcih he aims to pay as small an amount as possible, nor for teh worker, because it brings him only subsistence, the satisfaction of individual needs.

295 The worker who exchanges his commodity goes through the cycle C - M - M - C in the exchange process. If the point of departure in circulation is the commodity we necessarily arrive back at the commodity, since money appears only as coin and as a medium of exchange is only a vanishing mediation; while the commodity as such is consumed as the direct object of need.

Capital represents the opposite movement M - C - C - M.

295 - 6 Account of the differences between concrete and abstract labour; the former being specific and particular to the material(s) to which it is applied, the latter existing in a totality, indifferent to specificity but capable of encompassing all of them.

297 This opposition between capitalist and worker, capital and labour develops more purely and adequately in proportion as labour loses all characteristics of art, as its particular skill becomes something more and more a purely abstract or mechanical activity.

298 It is this process of differentiation and suspension, in which capital bcomes a process. On one side the objectivity to which it exists has to be cosumed by labour, on the other there mere subjectivity of labour as a mere form has to be suspended and labour is objectified in the material of capital.

300 Bourgeois economists only regard money in the form of articles of consumption and use-values obtained through exchange, rather than a capacity in every predicate of general wealth.

In reality there are discrete sequences of productive consumption underlying these activities; Marx explains them through chemical metaphors.

302 Once again, capital is a passive presence in the process, as objective being in which the formal character which makes it capital - the social relation - is extinguished because cotton or yarn or cloth enters into the process as material existences which certain natural properties; how these were posited in them makes no difference to the relation of living labour towards them; living labour does not directly relate to the objectified labour in the object.

304 Hegelian account of capital abolishing itself to realise / multiply itself in production.

305 It is correct to say that capital is not productive in the sense that it is merely the object or material that confronts labour, but it is more correct to say that it does not appear as any of the aspects of the productive process, nor their differences but rather as the self-propelling content of the process in general.

Productive labour is labour which produces capital. The piano maker is productive, but not the piano player, who only exchanges labour for revenue. The player might produce music but that does not make it productive labour anymore than ’the madman who produces delusions’; labour becomes productive by producing its own opposite.

Labour as a use-value exists only for capital, it does not belong to the worker who has no access to it.

306 The use value of a thing does not concern its seller, but its buyer. The property of a commodity does not determine its price but the cost of producing it, the amount of labour incarnated within it.

307 The worker therefore sells labour as a simple, pre-determined exchange value, determined by a previous process - as objectified labour - he sells it only insofar as it already objectifies a definite amount of labour; capital buys it as the general productive force of wealth.

In this way, the worker cannot become rich he necessarily impoverishes himself in surrendering the creative power of his labour which is appropriated by an alien power.

308 Capital cannot therefore be productive in and of itself.

311 It is not the point that in the course of the productive process that raw material achieves a higher status qua object, rather that it attains to a higher exchange value.

312 Raw material may be used up in the course of the production process but all that has changed is the material in relation to value; it does not change the latter.

313 The value of the product = value of the raw material + the value of the part of the instrument which has been destroyed, i.e. transferred to the product, which is suspended in its original form + the value of the labour.

314 - 5 Value is increased in the production process

318 The very existence of interest demonstrates the cost of production is not the sum of values which enter into production. For the industrial capitalist, interest is among his real costs of production; interest itself already presupposes capital.

325 The great historic task accomplished by capital is to create labour that is superfluous to subsistence; this is fulfilled once there has been such a development of needs that surplus labour above and beyond necessity has become a general need arising out of individual needs and when the severe discipline of capital acting on succeeding generations has developed general industriousness as the general property of the new species.

327 - 333 Critique of the physiocrats.

334 - 335 Capital is the endless and limitless drive to go beyond a limiting barrier.

335 - 337 Proof that surplus value does not grow in the same numerical proportion as productive force.

339 This is becuase the increase in the productive power of living labour increases the value of capital (diminishing the value of the worker) not because it increases the quantity of products or use values created by the same labour but rather because it diminishes necessary labour.

340 The smaller the fractional part of the working day which forms the worker’s necessary labour time, the smaller the increase in surplus value which capital obtains from the increase in productive force.

Thus, the more developed capital is, the more surplus labour it has created, the more extensively it must develop productive force to realise itself in smaller proportions; the self-realisation of capital becomes more difficult to the extent that it has already been realised.

355 The material the worker engages in the course of his labour contains objectified labour, a necessary condition of his work; if cotton did not already have the form of yarn and wood and iron a spindle the worker could produce no higher use value in the form of fabric.

Without labour this dead labour would be useless; in addition to creating new labour the worker reproduces it in the course of the labouring process. This reproduction costs no labour time but is rather the condition of relating to it as material. The capitalist therefore obtains this preservation of the old value just as free of charge as he obtains surplus labour.

389 The key characteristic of machinery is not that it saves labour, rather it saves necessary labour and creates surplus labour. This higher productivity of labour is expressed in i) the fact that capital has to buy a smaller amount of necessary labour to create the same value and a greater quantity of use values and ii) that less necessary labour creates the same exchange value, realises more material and a greater mass of use values.

Thus, if the total value of the capital remains the same an increase in the productive force means the constant part of capital (machinery and material) grows relative to the variable, i.e. to the part of capital which is exchanged for living labour, the wage fund; this means a smaller quantity of labour sets a larger quantity of capital in motion.

398 Surplus time is the excess of the working day above that part of it referred to as necessary labour time.

399 It is a law of capital to create surplus labour, disposable time, it can do this only by setting necessary labour in motion; by entering into exchange with the worker.

It is its tendency therefore to create as much labour as possible, just as it is its tendency to reduce necessary labour to a minimum.

It is therefore also a tendency of capital to incrase the size of the labouring population, as well as to posit a part of it as surplus population; people who are useless until such a time as capital wishes to utilise it.

402 So far we have seen how capital maintains its own value and attains a surplus; this is completed via a process of devaluation.

Firstly, capital does not increase absolute labour time but rather decreases the necessary labour time by increasing the force of production. Costs of its own production are reduced to the extent that it does so.

403 Capital has made the transition from the form of money to the form of a commodity of a product. In its money form it existed as value, it now exists as product and only ideally as price but not as value as such. The capitalist enters the process of circulation not as one engaged in exchange but as producer and the others engaged in exchange relative to him, consumers; they exchange money to obtain his commodity for their consumption, he exchanges his product to obtain their money.

Whether or not the capitalist succeeds in transforming this commodity they have obtained by their money into a sale demonetisation has taken place within this process, this is implied in the fact that the product of the process in its immediate form is not value, but has to enter anew into circulation to be realised as such. Therefore, while capital is reproduced as value and new value in the production process it is at the same time posited as not-value, as something which first has to be realised as value by mean of exchange. Each take place at different times and in different places; though they form a unity each is contingent.

404 - 6 In circulation the commodity is therefore confronted by a series of barriers which appear external to it; the first is consumption itself; the need for the commodity, the second is the availability of an equivalent, the commodity needs to be able to transform itself into money to realise itself.

In this sense the product as use value is in contradiction with itself as value.

407 The creation by capital of absolute surplus value is contingent on the constant expansion of the sphere of circulation. The surplus created at one point required the creation of surplus at another point for which it may be exchange, if only the production of more gold and silver so that if surplus value cannot directly become capital again it may exist in the form of moeny as the possibility of new capital.

408 The tendency towards the creation of a world market is therefore within capital itself; every limit appears as a barrier to be overcome.

The creation of relative surplus value, the production of surplus value based on the increase and development of the productive forces requires the production of new consumption; quantitative expansions of old consumption, creation of new needs by propagating existing ones and production of new needs, in other words, taking advantage of the fact that labour tends towards more diversity and differentiation.

409 Imperialism is a big part of this picture as well as higher levels of culture.

Thus just as production founded on capital creates universal industriousness on one side so does it create on the other side a system of general exploitation of the natural and human qualities; bourgeois society and its civilising qualities.

410 Nature thus becomes purely an object for humankind, purely a matter of utility, no longer recognised as a power for itself, the theoretical discvoery of its autonomous laws become a ruse so as to subjugate it under human needs. Along with this tendency capital drives byond national barriers and prejudices as much as beyond nature worship. It is destructive of this and revolutionises it.

411 - 4 Critical account of orthodox economists who deny the possibility of overproduction which arises from the non-identity of production and consumption.

415 There is a limit, not to production itself, but to production founded on capital, this is its general tendency to drive beyond every barrier to production. This is the kernel in which the inhibitor capital represents ot the development of the forces of production, it is not the absolute form of development, it is a condition of development as long as they require an external spur, which nevertheless also act as a bridle; the stages of productive development which precede capital nevertheless appear as fetters upon productive forces.

These limits are i) necessary labour, as imposing a limit on the exchange value of living labour capaciy and or the wages of the working population ii) surplus value, relative surplus labour time iii) the transformation into money iv) the restriction of the production of use values by exchange value.

416 However these limits come up against the general tendency of capital to abstract from:

i) necessary labour as limit of the exchange value of living labour capacity ii) surplus value as the limit of surplus labour and development of the forces of production iii) money as the limit of production iv) the restriction of the production of use values by exchange value.

Hence overproduction, i.e. the recall of all these necessary moments of production founded on capital.

Capital at the same time is thereby faced with the task of launching its attempt anew from from a higher level of the development with of productive force with each time greater collapse as capital.

THe entire credit system and the over-trading, over-speculation etc associated with it rests on the necessity of expanding and leaping over the barrier to circulation and the sphere of exchange. This eppars classically in the relations between peoples than in individuals, e.g. the English forced to lend to foreign nations to have them as customers.