Excerpts from the Classics: Political Economy of Capitalism

November 9, 2002

2. Political Economy of Capitalism

The sequence of quotations followed is similar to that of a Marxist political economy textbook and of Marx’s ‘Capital’; itself. It begins with abstracting and analyzing the simplest form of capitalist economic relations, the commodity. Then more complex analysis is added, moving toward capitalism as it functioned in the 19th century. The labor theory of value, surplus value, exploitation, profit, accumulation, cyclical crises, are among the categories examined. Lenin updates Marx’s analysis in terms of monopoly capitalism and the imperialist stage of capitalism and state monopoly capitalism, in the last quotations of the section. “Political economy…is the science of the conditions and forms under which the various human societies have produced and exchanged and on this basis have distributed their products.”

Engels, Anti-Duhring, 1876-78, MECW, Vol.25, p.135


“To become a commodity a product must be transferred to another, whom it will serve as a use-value; by means of an exchange.”

Marx, Capital, 1867, IP, Vol.1, p.48

“productive activity, if we leave out of sight its special form, viz., the useful character of the labor, is nothing but the expenditure of human labor power… of human brains, nerves, and muscles.”

Marx, Capital, 1867, IP, Vol.1, p.51

“If then we leave out of consideration the use value of commodities, they have only one common property left, that of being the product of labor…When looked at as crystals of this social substance, common to them all, they are – values.”

Marx, Capital, 1867, IP, Vol.1, p.45-46

“A commodity is, in the first place, a thing that satisfies a human want, in the second place, it is a thing that can be exchanged for another thing.”

Lenin, Karl Marx, Nov.1914, CW, Vol.21, p.59

The exchange of commodities is “the most ordinary and fundamental common and everyday relation of bourgeois (commodity) society. In this very simple phenomenon (in this ‘cell’ of bourgeois society) analysis reveals all the contradictions (or the germ of all the contradictions) of modern society.”

Lenin, On the Question of Dialectics, 1915, CW, Vol.38, p.360-61

“The divorcement of the direct producer from the means of production, i.e., his expropriation, which signifies the transition from simple commodity production to capitalist production (and which is the necessary condition for this transition) creates the home market.”

Lenin, Development of Capitalism in Russia, 1899, CW,Vol.3, p.67-68

“Services…as such … have a use value and because of their production costs also an exchange value.”

Marx, Theories of Surplus Value, 1861-63 Prog Moscow 1969, Part 1, p.168; MECW, Vol.31, p.24

“The exchange value of this useful effect [transportation’s change of location] is determined like that of any other commodity by the value of the elements of production (labor power and means of production) consumed in it plus the surplus value created by the surplus labor of the laborers employed in transportation.”

Marx, Capital, pub. 1893, IP, Vol.2, p.54

Value, money

“Value is a relation between two persons … a relation concealed beneath a material wrapping.”

Lenin, “Karl Marx” Nov. 1914, CW, Vol.21, p.60

“The labor-time socially necessary is that required to produce an article under the normal conditions of production and with the average degree of skill and intensity prevalent at the time.”

Marx, Capital, 1867, IP, Vol.1, p.47

“On the one hand, all labor is speaking physiologically, an expenditure of human labor-power and in its character of identical abstract human labor, it creates and forms the value of commodities.”

Marx, Capital, 1867, IP, Vol.1, p.53

“..money is the independent tangible form of existence of value, the value of the product in its independent value form, in which every trace of the use value of the commodities has been extinguished.”

Marx, Capital, pub. 1893, IP, Vol.2, p.59

Labor, Labor Power, Wages

“Wages are not what they appear to be, namely the value or price of labor, but only a masked form for the value or price of labor power.”

Marx, Wage Labour & Capital, 1849. MESW, IP, p.73; MECW, Vol.9, p.202

Labor power is “the aggregate of those mental and physical capabilities existing in a human being, which he exercises whenever he produces a use-value of any description.”

Marx, Capital, 1867, IP, Vol.1, p.164

“In contradistinction, therefore, to the case of other commodities, there enters into the determination of the value of labor power a historical and moral element. Nevertheless in a given country, at a given period, the average quantity of the means of subsistence necessary for the laborer is practically known.”

Marx, Capital, 1867, IP, Vol.l, p.168

“We must not lose sight of the indisputable fact that the development of capitalism inevitably entails a rising level of requirements for the entire population, including the industrial proletariat.”

Lenin, On the So-Called Market Question, Autumn 1893, CW, Vol.1, p.106

“Instead of paying for the labor, he only pays the value of the labor-power employed; therefore, the limit to his using a machine is fixed by the difference between the value of the machine and the value of the labor-power replaced by it.”

Marx, Capital, 1867, IP, Vol.1, p.392

“The best points in my book are: 1) the two-fold character of labor, according to whether it is expressed in use value or exchange value. (All understanding of the facts depends upon this.) It is emphasized immediately in the first chapter; 2) the treatment of surplus value independently of its particular forms as profit, interest, rent, etc.”

Marx, Letter to Engels, London Aug. 24, 1867, MESC, p.226-27; MECW, Vol.42, p.407

Surplus Value

“Therefore, the value of labor power, and the value which that labor power creates in the labor process, are two entirely different magnitudes, and this difference of the two values was what the capitalist had in view, when he was purchasing the labor power.”

Marx, Capital, 1867, IP, Vol.1, p.193

“Each worker receives on the average, 246 rubles a year, but he brings the capitalist an average profit of 252 rubles a year. It follows that the worker works ‘the lesser part of the day for himself and the greater part of it for the capitalist.'”

Lenin, Workers’ Earnings & Capitalist Profit in Russia, Aug 1912, CW, Vol.18, p.257

“The rate of surplus-value is. therefore, an exact expression for the degree of exploitation of labor-power by capital.”

Marx, Capital, 1867, IP, Vol.1, p.218

“The directing motive, the end and aim of capitalist production is to extract the greatest possible amount of surplus value and consequently to exploit labor-power to the greatest possible extent.”

Marx, Capital, 1867, IP, Vol.1, p.298

“The ultimate aim of this work [Capital], to lay bare the economic law of motion of modern society.”

Marx, Capital, IP, Vol.1, p.618

“Production of surplus value is the absolute law of this mode of production.”

Marx, Capital, 1867, IP, Vol.1, p.20

“The doctrine of surplus value is the cornerstone of Marx’ economic theory.”

Lenin, Three Sources & Three Component Parts of Marxism, March 1913, CW, Vol.19, p.26

Impoverishment, Unemployment

“He [Marx] spoke of the growth of poverty, degradation, etc., indicating at the same time the counteracting tendency and the real social forces that alone could give rise to this tendency. We actually see that capitalism has a tendency to engender and increase poverty, which acquires tremendous proportions when the above-mentioned counteracting tendency is absent.”

Lenin, Review of Karl Kautsky’s Book, April 1899, CW, Vol.4, p.201

“An industrial reserve army of labor is an indispensable attribute to the capitalist economy which could neither exist nor develop without it.”

Lenin, A Characterization of Economic Romanticism, Spring 1897, CW, Vol.2, p.181

“The greater the social wealth, the functioning capital, the extent and energy of its growth, and, therefore, also the absolute mass of the proletariat and the productiveness of its labour, the greater is the industrial reserve army. The same causes which develop the expansive power of capital, develop also the labour power at its disposal. The relative mass of the industrial reserve army increases therefore with the potential energy of wealth. But the greater the reserve army in proportion to the active labour army, the greater is the mass of a consolidated surplus population, whose misery is in inverse ratio to its torment of labour. The more extensive, finally, the lazarus-layers of the working class, and the industrial reserve army, the greater is official pauperism. This is the absolute general law of capitalist accumulation. Like all other laws it is modified in its working by many circumstances, the analysis of which does not concern us here.”

Marx, Capital, 1867, IP, Vol.I, p.644

“Machinery considered alone, shortens the hours os labor, but when in the service of capital, lengthens them; in itself it lightens labor, but when employed by capital heightens the intensity of labor; in itself it is a victory of man over the forces of nature, but in the hands of capital, makes man the slave of these forces; in itself it increases the wealth of the producers, but in the hands of capital makes them paupers.”

Marx, Capital, 1867, IP, Vol.1, p.482

“The organization of the workers and their constantly growing resistance will possibly check the increase of misery to a certain extent. However, what certainly does increase is the insecurity of existence.”

Engels, A Critique of the Social-Democratic Programme of 1891, June 1891,MECW, Vol.27, p.223

Working Class & Downfall of Capitalism

“The contradiction between social production and capitalist appropriation recurs as an antagonism between the organization of production in the individual workshop and the anarchy of production in society generally.”

Engels, Anti-Duhring, 1877, FLPH Moscow 1954, p.378; Socialism: Utopian & Scientific, MESW, IP, p.423; MECW, Vol.24, p.313

“The contradiction between socialized production and capitalistic appropriation manifested itself as the antagonism of proletariat and bourgeoisie..”

Engels, Anti-Duhring, 1877, FLPH Moscow 1954, p.378; Socialism: Utopian & Scientific, MESW, IP, p.421; MECW, Vol.24, p.311

“Along with the constantly diminishing number of magnates of capital, who usurp and monopolize all advantages of this process of transformation, grows the mass of misery, oppression, slavery, degradation, exploitation; but with this too grows the revolt of the working class, a class always increasing in number, and disciplined, united, organized by the very mechanism of the process of capitalist production itself. The monopoly of capital becomes a fetter upon the mode of production which has sprung up and flourished along with, and under it. Centralization of the means of production and socialization of labor at last reach a point where they become incompatible with their capitalist integument. This integument is burst asunder. The knell of capitalist private property sounds. The expropriators are expropriated.”

Marx, Capital, 1867, IP, Vol.1, p.763

Formation of the working class. “Only the development of capitalist production, modern industry and agriculture on a large scale, gave continuity to its existence, enlarged its number and formed it as a special class – with special interests and with a special historical mission.”

Engels, “The Workers Movement in America”, London, Jan.26, 1887, IP 1953, Letters to Americans: 1848-1895, Appendix, p.288; The Labor Movement in the United States, MECW, Vol.26, p.438

“Even the most favorable situation for the working class, no matter how it improves the material conditions of the worker, does not eliminate the contradictions between his interests and those of the bourgeois, the capitalist.”

Marx, Wage Labor & Capital, April 8, 1849, MECW, Vol.9, p.220

Accumulation & Primitive Accumulation

“Employing surplus-value as capital, reconverting it into capital, is called accumulation of capital.”

Marx, Capital, 1867, IP, Vol.1, p.543?

“The so-called primitive accumulation, therefore, is nothing else than the sustained process of divorcing the producer from the means of production. It appears as primitive, because it forms the pre- historic stage of capital and of the mode of production corresponding with it… And the history of this, their expropriation is written in the annals of mankind in letters of blood and fire.”

Marx, Capital, 1867, IP, Vol.1, p.714-715

Capital, Capitalism

“Capital as self expanding value embraces not only class relations, a society of a definite character resting on the existence of labor in the form of wage-labor. It is a movement, a circuit-describing process going through various stages, which itself comprises three different forms of the circuit-describing process. Therefore it can be understood only as motion,not as a thing at rest.”

Marx, Capital, pub.1893, IP, Vol.2, p.105

“Capital is not a thing, but rather a definite social production relation, belonging to a definite historical formation of society, which is manifested in a thing and lends this thing a specific social character.”

Marx, Capital, pub.1894, IP, Vol.3, p.814

“The process of production, considered, on the one hand, as the unity of the labor-process and the process of creating value is production of commodities; considered on the other hand, as the unity of the labor-process and the process of producing surplus- value, it is the capitalist process of production or capitalist production of commodities.”

Marx, Capital, 1867, IP, Vol.1, p.197

“By capitalism is meant that stage of the development of commodity production at which not only the products of human labor, but human labor power itself becomes a commodity.”

Lenin On the So-Called Market Question, Autumn 1893, CW, Vol.1, p.93

“The capitalist mode of production rests on the fact that the material conditions of production are in the hands of non-workers in the form of property in capital and land, while the masses are only owners of the personal conditions of production, of labor- power.”

Marx, Critique of the Gotha Programme, 1875, MESW, IP 1977, p.325; MECW, Vol.24, pp.87-8

“Capitalist production, therefore of itself reproduces the separation between labor-power and the means of labor. It thereby reproduces and perpetuates the condition for exploiting the worker. It incessantly forces him to sell his labor power in order to live, and enables the capitalist to purchase labor-power in order that he may enrich himself.”

Marx, Capital, 1867, IP, Vol.1, p.577

Profit & Its Rate

“Profit is nevertheless a converted form of surplus-value, a form in which its origin and the secret of its existence are obscured and extinguished.”

Marx, Capital, pub.1894, IP, Vol.3, p.48

“The actual difference of magnitude between profit and surplus- value… in the various spheres of production now conceals completely the true nature and origin of profit, not only for the capitalist who has a special interest in deceiving himself on this score, but also for the laborer. By the transformation of values into prices of production, the basis of the determination of value is itself removed from direct observation.”

Marx, Capital, pub.1894, IP, Vol.3, p.168

“The capitalist cost of the commodity is measured by the expenditure of capital, while the actual cost of the commodity is measured by the expenditure of labor.

Marx, Capital, pub.1894, IP, Vol.3, p.26

“The rate of profit is the motive power of capitalist production. Things are produced only as long as they can be produced with a profit.”

Marx, Capital, pub.1894, IP, Vol.3, p.259

“Expansion or contraction of production are determined by the appropriation of unpaid labor …, by profit and the proportion of this profit to the employed capital …, rather than the relation of production to social requirements, i.e., to the requirements of socially developed human beings… It comes to a standstill at a point forced by the production and realization of profit, and not the satisfaction of requirements of socially developed human beings.”

Marx, Capital, pub.1894, IP, Vol.3, p.258

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