COMMODITY-FORM

1. COMMODITY-FORM Introduction of political economy of capitalism

3. Marxist Tools of Analysis • Theory: Dialectical Materialism • Theory: Historical Materialism • Theory: Political Economy • Marx Major Work = Das Kapital • Centrality of Theory of Labour Value • Starting point: commodities

4. 1. The Commodity Form • Why Marx begins study of capital (i.e of capitalism) with analysis of commodities – those useful products of human labour which are bought and sold? • The answer is in two sentences of Chapter One of Capital

5. 2. The Commodity-Form • “The wealth of societies in which the capitalist mode of production prevails appears as an “immense collection of commodities” the individual commodity appears as its elementary form” (Marx, Capital). • He begins with commodity because it is the elementary form of wealth in capitalist society.

6. 3. Commodity Form • When we read the rest of Capital we discover that • All wealth takes a form of commodity-form in a capitalist society. • Commodity-form is the fundamental form of capitalism.

7. 4. Commodity Form • Capitalism is the way to organise social and economic life and social relations around the profit-motive and private ownership of the means of producing of commodities (or means of production). All aspects of life are secondary to the drive for profit-making. • Those who own the means of production for producing commodities happen to be few individuals – the capitalist class.

8. 5. Commodity Form • Those who do not control the means of producing commodities, but only sell their labour power happen to be the majority of the population – the working class. • In other words, capitalism is also these social relations, which are class relations.

9. 6. Commodity-Form • To clarify further about capitalism: • capitalism is the way in which the capitalist class imposes the commodity-form on the bulk of the population by forcing people to sell part of their lives as the commodity–labour power in order to survive and gain access to social wealth.

10. 7. Commodity-Form • This means that: • Majority of the people are put in situation where they are forced to work to avoid starvation. • The capitalist class creates and maintains this situation of compulsion by achieving total control of the means of producing social wealth – which under capitalism is immense collection of commodities.

11. 8 Commodity-Form • The general imposition of the commodity-form: • That forced work has become the fundamental means of organizing capitalist society. It means the creation of the working class, a class of people who can survive only by selling their capacity to work to the class that controls the means of producing commodities.

12. 9. Commodity-Form • If commodity-form consists of the forcible creation of a situation in which the only access to social wealth (food, clothing, etc) for workers is through selling the of their labour power, then it follows: • All products of labour must taken on the commodity-form

13. 10. Commodity-Form • All products of labour taken on commodity-form, means the following: • They must be sold the working class to ensure its survival, and • Since wealth for capital is nothing but the accumulation of labour and the products it produces, • Since both labour and those products take the commodity-form in capitalism, the individual commodity appears as the elementary form of that wealth

14. Expanded form of commodity • This means that • Capital seeks seeks to convert all of life into commodities.

15. Final Point • Commodity-form is a set of power relations – capitalist power to impose the commodity-form is the power to maintain the system itself – a system in which for most people life is converted into labour-power • Commodity-form is not apolitical concept, is ridden with class-conflict. • Commodity-form today, how much of our lives are commodified??

16. Present Capitalist Crisis and Commodities (1) • We not only high level of unemployment – but also • inflation = the general rise in prices of almost every commodity we buy. Rising prices affect all people, whether they have a waged job or not. • Whatever the form of one's income, inflation undercuts its real value.

17. Present Capitalist Crisis and Commodities (2) • For the working class in particular, • inflation has the direct effect of reducing the value of the one commodity that class has to sell: its labor-power. • For the capitalist class it is the reverse. Since they own the commodities whose prices are rising, their wealth, embodied in those commodities, tends to rise with the prices, and, therefore, so does their income derived from the sale of those commodities.

18. Present capitalist crisis and commodities (3) • Other factors assumed equal: • Inflation tends to reduce the income of the working class and increase that of capital -- causing a shift of value from one class to the other, especially when rising unemployment has the effect of further reducing nominal working-class income

19. Present Capitalist Crisis and Commodities (4) • Inflation today is not just a national phenomenon, confined to certain countries while others deflate; it is an international phenomenon. • The major elements are the dramatic rise in food and energy/oil prices

20. Present capitalist crisis and commodities (5) • These food and energy crises, involving price rises in the developed world and absolute unavailability in parts of the underdeveloped world, have been the result of explicit government policies • The sharp rise in food prices in the country and internationally were direct result of government policies – promoting speculation, monopoly pricing, bio-fuels and so on, contributing to • widespread famine in parts of Asia and Africa, nearly 900 million now living in hunger • Energy shortages and price rises (in the case of ESKOM) are a result of GEAR policy in the 1990s.

21. Now let us discuss the commodity in detail • What is a Commodity • Two Aspects of Commodity – use value and exchange • Examples of Labour Power, Food and Energy as Commodities • Class Perspectives of Commodities

22. 1. What is a Commodity? • A Commodity is a: • Useful Products of Human Labour that are bought and sold?

23. 2. Two Aspects of Commodity: Use-Value and Exchange Value (1) Marx begins his study of the commodity by analyzing it into its two characteristics. He points out that each commodity has a dual existence. It is both a • use-value and • an exchange-value.

24. 2. Two aspects of commodity (2) • A commodity is a use-value because it has a value in use -- a usefulness, or utility, it "satisfies human wants of some sort or another." • It also is an exchange-value because it has a value in exchange; that is, it can be exchanged for something else.

25. 2. Two aspects of Commodity (3) • The use-value and the exchange-value of a commodity are not just two different determinations aspects; they are contradictory aspects. • A commodity is a use-value only if it is immediately useful to whoever has it. It is an exchange-value only if it is not immediately useful but is used only for exchange to get something else.

26. 2. Two aspects of a commodity (4) • Exchange-value is thus not only different from use-value; it is exactly its opposite; they are defined by their contradictory position with respect to each other. Yet they are only the twofold aspects of the commodity, and the commodity is the unity of these opposites. • This combination of unity and opposition, in which the opposites only have their meaning vis-ˆ-vis each other and are thus inextricably joined, is exactly what Marx means by a contradictory relation. Let us talks about this more!

27. 2. Two aspects of a commodity (5) • Yet this seems to be an impossible situation, because to be a use-value a thing must be used and not exchanged. And to be an exchange-value it must not be used but must be traded off .

28. 2. Two aspects of a commodity (6) • Marx calls the realization of the two contradictory aspects that occurs in the circulation process the metamorphosis of the commodity. Before a commodity is sold and consumed, use-value and exchange-value have only an abstract and potential existence. Once it is sold, exchanged for money (C-M), then its character of exchange-value has been realized. • But in this exchange the form of its exchange-value appears as the money that realized it. When that money is then exchanged for another commodity, which is consumed (M-C), its exchange-value metamorphoses again into its other aspect as use-value, which is then realized. • We will now focus on the key commodities of the current period: labour-power, food, and energy.

29. 3. Commodity as Labour Power(1) • Commodity-Labour Power: • Goes directly to the heart of capitalism. • labour-power, or the capacity to work, is a commodity because throughout the world the working class has been forced to sell its strength and abilities to capitalist class.

30. 3. Commodity as Labour Power(2) • Use-Value of Labour Power (LP) • is its ability to work and to produce value and surplus value • Exchange Value of LP • is the value the working class gets in return for its sale.

31. 3. Commodity as Labour Power (3) • Contradictory use-value and exchange value of LP • The use-value and exchange-value of labour-power are clearly contradictory because labour-power can only be exchange-value for the working class (because it has no means of production) and not use-value. • Yet the same labour-power does have use-value for the capitalists who buy it and put it to work.

32. 3. Commodity as a Labour Power (4) • Two-sided class perspective of LP • For the capitalist class: • the use-value of labour-power, is its role as the fundamental means of capitalist social domination of working class lives. It is to be able capitalist to be able • to impose exploitation of labour is to retain social domination. But the use-value of labour-power for capitalist is also its ability to produce value and surplus value • Surplus value (profit) is therefore the aim of capitalist production to impose domination over the working class.

33. 3. Commodity as Labour Power(5) • For the Working Class, the perspective is: • But, even though the use-value of work is formally the domain of capitalist class, that is only from capitalist viewpoint. • From the working-class point of view, work can also have certain kinds of use-values for it. -- we can still see how the working class tries to turn the work which capitalist imposes on it to its own advantage. • To the degree that the workers get some part of the product they produce, then, at least indirectly, the use-value of their work to them is as useful labour, labour that produces use-values which satisfy their needs

34. 3. Commodity as Labour Power(6) • The exchange-value of labor-power is, as we have seen, the money which the working class receives for its sale. • Yet for the working class this exchange-value is at once income and a source of power in its struggle with capitalist class, while for the latter it is a cost and a deduction from total value produced, a threat to surplus value and thus to capitalist power. • Because of these differences there is often a struggle over the form in which the working class will receive the exchange-value of its labour-power: money wages, wages in kind, social services, welfare, unemployment benefits, pensions, and so forth.

35. 3.Commodity as Food (7) • Food as a Commodity • Much food consumed in the world, including South Africa today is produced by large capitalist agribusiness companies at home and abroad: the giant maize farms of the plains states, the banana plantations of Central America, and the beef ranches of the Argentine pampa are all capitalist producers selling their goods in an international market.

36. 3. Commodity as Food(8) • Food as a commodity • By the time it reaches the table, that food includes not only the paid and unpaid labor of production and transport workers but also the labor of the cooks -- mainly housewives

37. 3. Commodity as Food (9) • The use-value of commodity-food • is generally said to lie in its nutritional and aesthetic qualities. • The exchange-value of commodity-food • Its exchange-value lies in the money that the big agribusiness companies and middlemen receive from its sale. • As with labour-power and all other commodities, the realization of the two aspects is resolved through exchange.

38. 5. Class Perspectives on commodities (1) • Two aspects suggest two different class perspectives. Most fundamentally, • the view of the commodity as use-value is the perspective of the working class. It sees commodities (e.g., food or energy) primarily as objects of appropriation and consumption, things to be used to satisfy its needs. • Capitalist class sees these same commodities primarily as exchange-values -- mere means toward the end of increasing itself and its social domination via the realization of surplus value and profit .

39. 5. Class Perspectives on Food (2) • Two-sided class perspectives on commodity-food • while the working class is primarily concerned with the use-value of food, the fact that food does have an exchange-value, a money price that limits workers' access to it, means that they must also be concerned with that exchange-value. • Moreover, the capitalists, if it would sell its products, must pay some attention to the use-value. Rotten food rarely sells; miracle rice must have an acceptable taste; bread must be white or dark depending on the group of workers to whom it is sold. • We can see how each perspective depends on the other. It is exactly because workers have needs (and no means of producing what they need) that capital can sell those use-values and realize the exchange-values it desires. It is exactly because labour-power is a use-value for capitalist class that it is an exchange-value for labour

40. 5. Class Perspectives of Food(3) • For the working class, • the use-value of food is above all its role as our fundamental consumption good -- nourishment to live. Because of our need for this use-value of food, • capitalist class understood early on that its control over food as a commodity gave it control over workers. This was why the most basic means of production stripped from workers in the period primitive accumulation was land -- the traditionally necessary precondition for producing food.

41. 5. Class Perspectives on Food(5) • Thus the fundamental use-value of food for capital is the power to force the working class to work to get it. The need of the working class for this use-value has thus led capital to make scarcity -- hunger -- a basic ingredient of its social order. "Everything therefore depends upon making hunger permanent among the working class."

42. 5. Class Perspectives on Food (6) • This is a very basic point which has immediate bearing on the current crisis, in which hunger is playing a deadly role in the struggle between the classes. Because food plays this role in capital's strategy against the working class, it means that the working class, too, recognizes in food a fundamental requirement for the development of its power against capital. • Especially among the least-powerful sectors of the class, those on the lowest rungs of the income hierarchy, the use-value of food in its struggles is critical. It is not surprising that peasant struggles often turn to crop or land seizures. It is generally only on the basis of an adequate supply of food that such struggles can move to other levels.

43. 5. Class Perspectives on Food (7) • The Two Aspects of a Commodity • express the two-sided contradiction characteristic of the class relations in capitalism. • Use-value and exchange-value are opposed in a contradictory unity in the same way that capitalist and working classes are opposed and united. • Each is the opposite of the other but at the same time exists, as such, only in the relation.

44. 5. Class Perspectives on Food (8) • These observations serve to clarify the importance of the two class perspectives on the exchange-value of food: • As with other commodities, its exchange-value for capital is a source of surplus value; but for the working class the exchange-value of food, relative to the exchange-value of labor-power, determines its access to food and the use-values of nutrition and power it provides. • Thus the exchange-value for food both undermines working-class income and power and strengthens capital's position in terms of both profits and control. Indeed, short of absolute scarcity, price (the money form or exchange-value) is capital's key weapon in "making hunger permanent."

45. 5. Class Perspectives on Food (9) • When, as in the current crisis, it undertakes to engineer a global rise in the exchange value of food, it is not only increasing its profits but also increasing its power vis-ˆ-vis the working class. • Thus it should not be surprising that the response of various sectors of the working class to such an attack is a function of their power. Where they have little power, they cannot avoid starvation.

46. 5. Class Perspectives on Food (10) • For the Working Class: • the use-value of food is above all its role as our fundamental consumption good -- nourishment to live. Because of our need for this use-value of food, • Capitalist class understood early on that its control over food as a commodity gave it control over workers. This was why the most basic means of production stripped from workers in the period primitive accumulation was land -- the traditionally necessary precondition for producing food.

47. 5. Class Perspectives on Food (11) • Thus the fundamental use-value of food for capital is the power to force the working class to work to get it. The need of the working class for this use-value has thus led capital to make scarcity -- hunger -- a basic ingredient of its social order. "Everything therefore depends upon making hunger permanent among the working class.“ (Marx Das Capital ) • This is a very basic point which has immediate bearing on the current crisis, in which hunger is playing a deadly role in the struggle between the classes. • Because food plays this role in capital's strategy against the working class, it means that the working class, too, recognizes in food a fundamental requirement for the development of its power against capital.

48. 5. Class Perspective on Energy (12) • Energy as a commodity: • The price rise of this commodity seems to be playing such a key role in the present capitalist crisis? A class analysis of the use- and exchange-values of energy brings out a number of important relations. The kinds of energy which we usually think of as commodities are those like oil, electricity or, in less-developed countries, wood, charcoal, or dung. • When we question the nature of the use-value of these commodities from the two class perspectives we get some interesting results.

49. 5. Class Perspective on Energy (13) • From a working-class point of view • some of these are commodities which are consumed more or less directly: electricity to power household appliances, lights, or heating equipment; natural gas, coal, wood, or dung to provide (in certain situations) energy for heating, cooking, and lighting; gasoline to provide energy for lawnmowers, boats, and, above all, cars. • Like food they are consumption goods whose use-values lie in their ability to reduce work and make life more pleasant. There is also an apparent hierarchy of sorts in the usefulness of these energy commodities; they vary in their versatility and aesthetic value. • Although ranking may vary for different uses and vary by culture, we can generally see that electricity or natural gas gives greater versatility and is easier to handle than say charcoal or dung.

50. 5. Class Perspective on Energy (14) • But this brings out another facet that must be understood. • In so far as energy is a substitute for human strength in the production process, and in so far as the working class has an interest in the expenditure of its own labor-power as use-value (in its struggles over the conditions of work), then it also can see in the energy commodity the use-value of reducing the required expenditure of human sweat. • In other words, for the working class energy has the use-value not only of reducing work at home but also of reducing work in the factory.