Getting to the Bottom of the Concept

What does "Critique" mean in the "Critique of Political Economy"?

Anne-Kathrin Krug

Anne-Kathrin Krug is an attorney in Berlin and a team organizer for reading groups of Karl Marx’s Capital at the Rosa Luxemburg Foundation. She is a member of the Working Group on the Critique of Law and in this context deals with Marxist legal theory.

“Where science comes in is to show how the law of value asserts itself.  So, if one wanted to ‘explain’ from the outset all phenomena that apparently contradict the law, one would have to provide the science before the science […] Why then have science at all?”
(Marx-Engels Collected Works, Volume 43, p. 67f., Letter from Marx to Kugelmann, London, July 11, 1868)

The words “critique” and “criticism” are often used.  When we “criticize” something, we often mean that something is not as it should be.  For example, we criticize the fact that there are drastic differences between the amounts in people’s wallets, and that the profits of business are not adequately redistributed.

Marx also engages in criticism in Capital – but in a different way
Marx’s critique is directed against the capitalist mode of production itself, but without making any positive ‘suggestions for improvement’ or proclaiming them as demands.

His critique is also directed against the political economy of the time, that is to say, the scholarly discipline familiar to us today as “economics”.  Its most important representatives at the time were Adam Smith and David Ricardo.  Among other things, Marx accuses them (and others) of not, or not sufficiently, getting to the bottom of preexisting forms and concepts like value, money, capital, and profit.

That led to essential questions remaining unresolved, and the perception that these forms and concepts accompanied every type of economy.  This distorts our perspective of the specificity of the capitalist mode of production, which is not transhistorical, as well as our perspective of other possible economic systems. So, one can say: The aim of the critique of political economy is to question and analyze the forms and concepts of the capitalist mode of production as we encounter them in political economy and everyday life.  Instead of simply accepting them “as they are”, Marx asks: What is value? What is money? What is capital? What is profit? and, What are the social relations that generate these forms and concepts in the first place?  He is concerned with answering the question: What makes the capitalist mode of production the capitalist mode of production?

Marx’s mode of critique thus consists primarily in exactly analyzing and presenting what the capitalist mode of production is, that is to say which practices, concepts, and which (also compulsory) notions, contradictions, misapprehensions, obfuscations etc. accompany it. Over the course of three volumes, he sets out, piece by piece, a theoretical complex that begins at a very high level of abstraction and in the third volume arrives at “concrete forms” (Capital Volume III, p. 117, Penguin Classics edition) as they “appear on the surface of society” and “in the every consciousness of the agents of production themselves.” (ibid.)  At new levels of abstraction, concepts are repeatedly overhauled and reconstructed, without being discarded at their previously depicted levels of abstraction.  On the contrary: each level of presentation and abstraction builds upon the previous one, and is the condition for advancing.  In this manner, Marx develops a theoretical nexus, a type of derivation, which gets to the bottom of the forms and concepts of everyday life and political economy such as, for example, ground rent, profit, and the wage, instead of simply beginning with them.

These fundamental assumptions and concepts also inform our contemporary everyday understanding of economics, and make Marx’s critique of political economy so controversial even today. The central mission of the critique is to make understandable why, in everyday economic understanding and also in political economy (as well as contemporary economics), with the predominant forms and given concepts, it is not – and cannot – be clear that “the value of commodities is determined by the labour they contain” (Capital, Volume III, p. 272) and why profit is no longer traced back to unpaid labor. (ibid.)

The Connecting Factors of Labor and Value
Marx presupposes that labor is the source of value, which is expressed in money.  Only labor creates value.  This is the fundamental assumption of the so-called labor theory of value, which in Marx’s time was not as controversial as it is today.  Marx does not determine value according to an individual point of view in line with the motto: “I like to eat red cherries, but black cherries much more.”  (a popular German children’s song: Rote Kirschen ess ich gern, schwarze noch viel lieber).  Thus black cherries would be considerably more valuable than the red ones, but only if I don’t overeat.  Value is determined socially from the very beginning, not by the preferences of isolated individuals.

Things or goods are initially products of labor of a specific social context.  The ways in which labor is organized in different societies are distinct.  Marx says that things are produced in different societies under different conditions and that it is nonsensical to assume that “the first stone which the savage flings at the wild animal he pursues” (Capital, Volume I, p. 291) is already capital.  Marx makes fun of how concepts of the capitalist mode of production are projected backwards in time onto earlier social formations, such as by R. Torrens in “An essay on the Production of Wealth etc.”: “'In the first stone which the savage flings at the wild animal he pursues, in the first stick that he seizes to strike down the fruit which hangs above his reach, we see the appropriation of one article for the purpose of aiding in the acquisition of another, and thus discover the origin of capital.”  Marx comments with amusement: “No doubt this 'first stick' [Stock] would also explain why ‘stock' in English is synonymous with capital.” (ibid.)

According to Marx, societies are constituted by human labor.  That is in no way antiquated or far-fetched.  Marx writes in the same letter to Ludwig Kugelmann dated July 11, 1868: “Every child knows that any nation that stopped working, not for a year, but let us say, just for a few weeks, would perish.”  (MECW 43, p. 68) That economics at its core has something to do with human labor is evident.  The production of objects of utility and therefore the reproduction of society (or societies) functions first and foremost by means of human labor and through the division of labor, which is not first “invented” by capitalism.

The social nexus is constituted in a unique way under capitalism.  Objects of utility are not produced according to need, but rather are produced in order to sell them and in order to realize a profit.  Investment in means of production and labor-power is undertaken by private businesses on their own initiative and independently of each other.  Without really knowing whether anybody needs these things or how many, and whether anybody can actually pay for them, the things are produced in order to be sold.  On the market, producers no longer have any direct contact with each other.  Their contact is mediated by the things to be sold.  If these things encounter solvent demand, then it’s clear that their labor is part of the total labor of society.  It is first through an amount of money being forked out that the value of commodities is realized.  If not, then they are not part of the total labor of society.  They have no value that can be expressed in an amount of money.

Things appear to have value and a magnitude of value naturally, and they appear to be naturally products of private labor.  These characteristics of labor arise from the social form of labor.  Nonetheless, in our thoughts, they become characteristics of the things themselves.  The result is that we look at a pair of sports shoes and know that it’s worth 100 euros.  If we buy this pair of sports shoes, it actually has value, otherwise we wouldn’t fork out 100 euros for it.  That means we have to relate to things as “things of value”.

Surplus Labor and Surplus Value
The magnitude of value is not determined by individually expended labor-time, but rather by the average socially necessary labor-time required to make a specific product.  Since labor-power is itself a commodity, the magnitude of value of the commodity of labor-power is determined by the value necessary for an average worker to reproduce him- or herself.  That is the value of necessary means of subsistence.  This value of means of subsistence is therefore the value of the commodity of labor-power and is paid as a wage.  Labor-power has the peculiar quality of being the source of value and being able to produce more value than necessary for its own reproduction.  The value created that goes beyond the value of means of subsistence is surplus value.  It results from the fact that labor-power is forced to work longer than would be necessary to recreate its own value.  Labor-power provides surplus labor that is not paid.

The capitalist pockets the surplus value.  The wage laborer only receives the wage.  Regardless of how high this wage is: exploitation always occurs.  Marx refers to the process of appropriating surplus labor as “exploitation”.  This appropriation of the labor of others in the form of surplus value is a central aspect of the capitalist mode of production. The level of exploitation is measured by the rate of surplus value.  Here, the magnitude of surplus value is divided by the magnitude of value of wages.  In this we see the share of the value of labor-power in surplus value, or to put it another way: how much workers work for themselves, and how much they work for capitalists.

The question that arises throughout the three volumes can now be formulated more precisely: How can it be that human labor, as the only source of value, and the appropriation of the labor of others, as the appropriation of surplus value in the total process of the capitalist mode of production, becomes unrecognizable, that is to say, can hardly be perceived at the level of appearances? The fundamental thought that thus arises is: just because labor as the source of value and the appropriation of the labor of others becomes unrecognizable, does not mean that these circumstances cannot have an effect.  The effect is generated across various levels of mediation, at the “end” of which, price does not necessarily correspond to value, and in fact does not necessarily represent value at all (such is the case, for example, with virgin land, which has a price, but no value).

From Surplus Value to Profit
Marx asks how, and by what means, labor as the source of value and the appropriation of surplus labor as surplus value become unrecognizable “on the surface of society” (Capital, Volume III, p. 117).  He thus develops value, surplus value, and the rate of surplus value as analytical concepts, which, however, in the everyday life of people and in the concepts of political economy are already mediated by many circumstances.  Nobody talks about value, surplus value, or the rate of surplus value, but rather about price, profit, and the rate of profit.  In empirical reality, we are dealing with the results of social interrelations, which for that reason cannot be the point of departure for analysis – as they are for political economy.  They are results, i.e. that which must be explained in the first place. 

Profit is a mediated and mystifying form of appearance of surplus value: it is the result of the capital advanced for means of production and labor-power.  The fact that money must be advanced for both means of production and labor-power makes labor as the source of surplus value unrecognizable.  The further fact that workers themselves assume that they are paid for their work consolidates this perception that profit arises not due to their efforts, but rather as a result of the capital advanced.  Furthermore, profit is not the surplus that a capitalist appropriates from the surplus labor of the workers he employs.  In reality, an average profit is generated to which all capital advanced relates.  Every capitalist acquires a share in the total social profit.  The share is determined by the relationship to one’s own advanced capital – like in the distribution of dividends by a joint-stock company.

Finally, it appears that the provision of land by landlords is what generates rent.  With the expression “the trinity formula” (Capital, Volume III, p. 953), according to which profit comes from capital, ground rent from land, and the wage from labor, Marx pinpoints the misunderstandings of his contemporaries.  The fact that surplus value is distributed among various functionaries has disappeared in everyday consciousness as well as in the concepts of economics.  Bringing this to light is what is meant by “critique” in Marx’s sense.

Favorite texts on the topic:
Capital, Volumes I-III, Penguin Classics (New York and London), translated by Ben Fowkes and David Fernbach