Marx then investigates the processes by which money is transformed into capital, and finds, first, that the form in which money circulates as capital is the inversion of the form in which it circulates as the general equivalent of commodities. The simple owner of commodities sells in order to buy; he sells what he does not need, and with the money thus procured he buys what he does need. The incipient capitalist starts by buying what he does not need himself; he buys in order to sell, and to sell at a higher price, in order to get back the value of the money originally thrown into the transaction, augmented by an increment in money; and Marx calls this increment surplus-value. Whence comes this surplus-value? It cannot come either from the buyer buying the commodities under their value, or from the seller selling them above their value. For in both cases the gains and the losses of each individual cancel each other, as each individual is in turn buyer and seller. Nor can it come from cheating, for though cheating can enrich one person at the expense of another, it cannot increase the total sum possessed by both, and therefore cannot augment the sum of the values in circulation. The capitalist class, as a whole, in any country, cannot over-reach themselves. And yet we find that in each country the capitalist class as a whole is continuously enriching itself before our eyes, by selling dearer than it had bought, by appropriating to itself surplus-value. We are therefore just where we were at the start: whence comes this surplus-value? This problem must be solved, and it must be solved in a purely economic way, excluding all cheating and the intervention of any force the problem being: how is it possible constantly to sell dearer than one has bought, even on the hypothesis that equal values are always exchanged for equal values? The solution of this problem was the most epoch-making achievement of Marx s work. It spread the clear light of day through economic domains in which socialists no less than bourgeois economists previously groped in utter darkness. Scientific socialism dates from the discovery of this solution and has been built up around it. This solution is as follows: The increase in the value of money that is to be converted into capital cannot take place in the money itself, nor can it originate in the purchase, as here this money does no more than realise the price of the commodity, and this price, inasmuch as we took as our premise an exchange of equivalents, is not different from its value. For the same reason, the increase in value cannot originate in the sale of the commodity. The change must, therefore, take place in the commodity bought; not however in its value, as it is bought and sold at its value, but in its use-value as such, that is, the change of value must originate in the consumption of the commodity. In order to be able to extract value from the consumption of a commodity, our friend, Moneybags, must be so lucky as to find ... in the market, a commodity, whose use-value possesses the peculiar property of being a source of value, whose actual consumption, therefore, is itself an embodiment of labour, and, consequently, a creation of value. The possessor of money does find on the market such a special commodity in capacity for labour or labour-power. Though, as we saw, labour as such can have no value, this is by no means the case with labour-power. This acquires a value from the moment that it becomes a commodity, as it is in fact at the present time, and this value is determined, as in the case of every other commodity, by the labour-time necessary for the production, and consequently also the reproduction, of this special article ; that is to say, by the labour-time necessary for the production of the means of subsistence which the labourer requires for his maintenance in a fit state to work and for the perpetuation of his race. Let us assume that these means of subsistence represent six hours of labour-time daily. Our incipient capitalist, who buys labour-power for carrying on his business, i.e., hires a labourer, consequently pays this labourer the full value of his day's labour-power if he pays him a sum of money which also represents six hours of labour. And as soon as the labourer has worked six hours in the employment of the incipient capitalist, he has fully reimbursed the latter for his outlay, for the value of the day's labour-power which he had paid. But so far the money would not have been converted into capital, it would not have produced any surplus-value. And for this reason the buyer of labour-power has quite a different notion of the nature of the transaction he has carried out. The fact that only six hours labour is necessary to keep the labourer alive for twenty-four hours, does not in any way prevent him from working twelve hours out of the twenty-four. The value of the labour-power, and the value which that labour-power creates in the labour-process, are two different magnitudes. The owner of the money has paid the value of a day s labour-power; his, therefore, is the use of it for a day a whole day s labour. The circumstance that the value which the use of it during one day creates is double its own value for a day is a piece of especially good luck for the buyer, but according to the laws of exchange of commodities by no means an injustice to the seller. On our assumption, therefore, the labourer each day costs the owner of money the value of the product of six hours labour, but he hands over to him each day the value of the product of twelve hours' labour. The difference in favour of the owner of the money is six hours of unpaid surplus-labour, a surplus-product for which he does not pay and in which six hours labour is embodied. The trick has been performed. Surplus-value has been produced; money has been converted into capital. In thus showing how surplus-value arises, and how alone surplus-value can arise under the domination of the laws regulating the exchange of commodities, Marx exposed the mechanism of the existing capitalist mode of production and of the mode of appropriation based on it; he revealed the core around which the whole existing social order has crystallised. However, this creation of capital requires that one essential prerequisite be fulfilled: For the conversion of his money into capital the owner of money must meet in the market with the free labourer, free in the double sense, that as a free man he can dispose of his labour-power as his own commodity, and that on the other hand he has no other commodity for sale, is short of everything necessary for the realisation of his labour-power. But this relation between the owners of money or of commodities on the one hand, and those who possess nothing beyond their own labour-power on the other, is not a natural relation, nor is it one that is common to all historical periods: It is clearly the result of a past historical development, the product ... of the extinction of a whole series of older forms of social production. And in fact we first encounter this free labourer on a mass scale in history at the end of the fifteenth and the beginning of the sixteenth century, as a result of the dissolution of the feudal mode of production. With this, however, and with the bringing into being of world trade and the world market dating from the same epoch, the basis was established on which the mass of the existing movable wealth was necessarily more and more converted into capital, and the capitalist mode of production, aimed at the creation of surplus-value, necessarily became more and more exclusively the prevailing mode. Up to this point, we have been following the barren conceptions of Marx, these bastards of historical and logical fantasy in which the faculty of discernment perishes, together with all honesty in the use of concepts . Let us contrast these frivolities with the profound logical truths and the definitive and most strictly scientific treatment in the sense of the exact disciplines {D. K. G. 498}, such as Herr D hring offers us. So Marx does not hold the accepted economic view of capital, namely, that it is a means of production already produced {497}; he says, on the contrary, that a sum of values is converted into capital only when it increases its value, when it forms surplus-value. And what does Herr D hring say? On page 262 {D. C.} this is further developed: What is it then that distinguishes the D hringian conception of capital from the Marxian? Capital, says Marx, has not invented surplus-labour. Wherever a part of society possesses the monopoly of the means of production, the labourer, free or not free, must add to the working-time necessary for his own maintenance an extra working-time in order to produce the means of subsistence for the owners of the means of production. Surplus-labour, labour beyond the time required for the labourer's own maintenance, and appropriation by others of the product of this surplus-labour, the exploitation of labour, is therefore common to all forms of society that have existed hitherto, in so far as these have moved in class antagonisms. But it is only when the product of this surplus-labour assumes the form of surplus-value, when the owner of the means of production finds the free labourer free from social fetters and free from possessions of his own as an object of exploitation, and exploits him for the purpose of the production of commodities it is only then, according to Marx, that the means of production assume the specific character of capital. And this first took place on a large scale at the end of the fifteenth and the beginning of the sixteenth century. Herr D hring on the contrary declares that every sum of means of production which forms shares in the fruits of the general labour-power {D. C. 40}, that is, yields surplus-labour in any form, is capital. In other words, Herr D hring annexes the surplus-labour discovered by Marx, in order to use it to kill the surplus-value, likewise discovered by Marx, which for the moment 3 does not suit his purpose. According to Herr D hring, therefore, not only the movable and immovable wealth of the Corinthian and Athenian citizens, built on a slave economy, but also the wealth of the large Roman landowners of the time of the empire, and equally the wealth of the feudal barons of the Middle Ages, in so far as it in any way served production all this without distinction is capital. So that Herr D hring himself does not hold the accepted view of capital, namely, that it is a means of production already produced {D. K. G. 497}, but rather one that is the very opposite of it, a view which includes in capital even means of production which have not been produced, the earth and its natural resources. The idea, however, that capital is simply produced means of production is once again the accepted view only in vulgar political economy. Outside of this vulgar economics, which Herr D hring holds so dear, the produced means of production or any sum of values whatever, becomes capital only by yielding profit or interest, i.e., by appropriating the surplus-product of unpaid labour in the form of surplus-value, and, moreover, by appropriating it in these two definite subforms of surplus-value. It is of absolutely no importance that the whole of bourgeois economy is still labouring under the idea that the property of yielding profit or interest is inherent in every sum of values which is utilised under normal conditions in production or exchange. In classical political economy, capital and profit, or capital and interest, are just as inseparable, stand in the same reciprocal relations to each other, as cause and effect, father and son, yesterday and today. The word capital in its modern economic meaning is first met with, however, at the time when the thing itself makes its appearance, when movable wealth acquires, to a greater and greater extent, the function of capital, by exploiting the surplus-labour of free labourers for the production of commodities; and in fact it was introduced by the first nation of capitalists in history, the Italians of the fifteenth and sixteenth centuries. And if Marx was the first to make a fundamental analysis of the mode of appropriation characteristic of modern capital; if he brought the concept of capital into harmony with the historical facts from which, in the last analysis, it had been abstracted, and to which it owed its existence; if by so doing Marx cleared this economic concept of those obscure and vacillating ideas which still clung to it even in classical bourgeois political economy and among the former socialists then it was Marx who applied that definitive and most strictly scientific treatment {498} about which Herr D hring is so constantly talking and which we so painfully miss in his works. In actual fact, Herr D hring s treatment is quite different from this. He is not content with first inveighing against the presentation of capital as a historical phase by calling it a bastard of historical and logical fantasy {498} and then himself presenting it as a historical phase. He also roundly declares that all means of economic power, all means of production which appropriate shares in the fruits of the general labour-power {D. C. 40} and therefore also landed property in all class societies are capital; which however does not in the least prevent him, in the further course of his exposition, from separating landed property and land rent, quite in the traditional manner, from capital and profit, and designating as capital only those means of production which yield profit or interest, as he does at considerable length on page 156 and the following pages of his Cursus. With equal justice Herr D hring might first include under the name 'locomotive" also horses, oxen, asses and dogs, on the ground that these, too, can be used as means of transport, and reproach modern engineers with limiting the name locomotive to the modern steam-engine and thereby setting it up as a historical phase, using barren conceptions, bastards of historical and logical fantasy and so forth; and then finally declare that horses, asses, oxen and dogs are nevertheless excluded from the term locomotive, and that this term is applicable only to the steam-engine. And so once more we are compelled to say that it is precisely the D hringian conception of capital in which all keenness of economic analysis is lost and the faculty of discernment perishes, together with all honesty in the use of concepts; and that the barren conceptions, the confusion, the frivolities palmed off as profound logical truths and the fragility of the foundations are to be found in full bloom precisely in Herr D hring s work. But all that is of no consequence. For Herr D hring s is the glory nevertheless of having discovered the axis on which all economics, all politics and jurisprudence, in a word, all history, has hitherto revolved. Here it is: Article One: Labour produces. Article Two: Force distributes. And this, speaking in plain human language {D. K. G. 496}, sums up the whole of Herr D hring's economic wisdom.
1877: Anti-Duhring - Capital and Surplus Value