Picking up where I left off (weekends are for rest) --
Even More on the Differences Between Time-chits and Money (and how that doesn't add up):
In this case the bank is simultaneously the general buyer and the general seller in one person. Or the opposite takes place. In this case, the bank chit is mere paper which claims to be the generally recognized symbol of exchange value, but has in fact no value. For this symbol has to have the property of not merely representing, but being, exchange value in actual exchange. In the latter case the bank chit would not be money, or it would be money only by convention between the bank and its clients, but not on the open market. It would be the same as a meal ticket good for a dozen meals which I obtain from a restaurant, or a theatre pass good for a dozen evenings, both of which represent money, but only in this particular restaurant or this particular theatre. The bank chit would have ceased to meet the qualifications of money, since it would not circulate among the general public, but only between the bank and its clients...
..The bank would thus be the general buyer and seller. Instead of notes it could also issue cheques, and instead of that it could also keep simple bank accounts. Depending on the sum of commodity values which X had deposited with the bank, X would have that sum in the form of other commodities to his credit. A second attribute of the bank would be necessary: it would need the power to establish the exchange value of all commodities, i.e. the labour time materialized in them, in an authentic manner. But its functions could not end there. It would have to determine the labour time in which commodities could be produced, with the average means of production available in a given industry, i.e. the time in which they would have to be produced. But that also would not be sufficient. It would not only have to determine the time in which a certain quantity of products had to be produced, and place the producers in conditions which made their labour equally productive (i.e. it would have to balance and to arrange the distribution of the means of labour), but it would also have to determine the amounts of labour time to be employed in the different branches of production. The latter would be necessary because, in order to realize exchange value and make the bank’s currency really convertible, social production in general would have to be stabilized and arranged so that the needs of the partners in exchange were always satisfied. Nor is this all. The biggest exchange process is not that between commodities, but that between commodities and labour. (More on this presently.) The workers would not be selling their labour to the bank, but they would receive the exchange value for the entire product of their labour, etc. Precisely seen, then, the bank would be not only the general buyer and seller, but also the general producer. In fact either it would be a despotic ruler of production and trustee of distribution, or it would indeed be nothing more than a board which keeps the books and accounts for a society producing in common. The common ownership of the means of production is presupposed, etc., etc. The Saint-Simonians made their bank into the papacy of production.
What Adam Smith, in the true eighteenth-century manner, puts in the prehistoric period, the period preceding history, is rather a product of history.
This reciprocal dependence is expressed in the constant necessity for exchange, and in exchange value as the all-sided mediation. The economists express this as follows: Each pursues his private interest and only his private interest; and thereby serves the private interests of all, the general interest, without willing or knowing it. The real point is not that each individual’s pursuit of his private interest promotes the totality of private interests, the general interest. One could just as well deduce from this abstract phrase that each individual reciprocally blocks the assertion of the others’ interests, so that, instead of a general affirmation, this war of all against all produces a general negation. The point is rather that private interest is itself already a socially determined interest, which can be achieved only within the conditions laid down by society and with the means provided by society; hence it is bound to the reproduction of these conditions and means. It is the interest of private persons; but its content, as well as the form and means of its realization, is given by social conditions independent of all.
Heh, those are right next to one another, but they are both really good sections. The first, as criticism of naive socialisms (one which mimics the same criticism I've heard levied against socialism, that the Party now is both the State and the Employer), and the second for talking about scope. "Private interest" is a social relation, which Marx here points out, while real, is the product of the time (the private interests come on the scene as soon as bourgeois politics begins to undermine feudal social relations) -- one could do worse in reading Marx in always remembering that Feudalism is the historical analogue of Capitalism: it's on a scope larger than the individual, in that case, fiefs and duchies and kingdoms and the entire mess that was medieval ownership, but it's those
over time, and they are independent of any individual kingdom, duchy, fief, and so forth.
But more on
our relationship, in capitalism to the social bond:
The reciprocal and all-sided dependence of individuals who are indifferent to one another forms their social connection. This social bond is expressed in exchange value, by means of which alone each individual’s own activity or his product becomes an activity and a product for him; he must produce a general product – exchange value, or, the latter isolated for itself and individualized, money. On the other side, the power which each individual exercises over the activity of others or over social wealth exists in him as the owner of exchange values, of money. The individual carries his social power, as well as his bond with society, in his pocket.
Something interesting to note here is in relation to We-Intentions. Note how money, here, is not given power due to We-Intentions, but because it is an independent, social entity with objectively determinable properties.
But, back to the badness of time-chits:
Individuals are subsumed under social production; social production exists outside them as their fate; but social production is not subsumed under individuals, manageable by them as their common wealth. There can therefore be nothing more erroneous and absurd than to postulate the control by the united individuals of their total production, on the basis of exchange value, of money, as was done above in the case of the time-chit bank.
Or, really, I'm just stressing the point about the social being both real and independent of individuals.
Something often misunderstood with Marx is how he feels about capitalism. He's actually quite fascinated with its operations. And he judges it positively:
It has been said and may be said that this is precisely the beauty and the greatness of it: this spontaneous interconnection, this material and mental metabolism which is independent of the knowing and willing of individuals, and which presupposes their reciprocal independence and indifference. And, certainly, this objective connection is preferable to the lack of any connection, or to a merely local connection resting on blood ties, or on primeval, natural or master-servant relations.
Equally certain is it that individuals cannot gain mastery over their own social interconnections before they have created them. But it is an insipid notion to conceive of this merely objective bond as a spontaneous, natural attribute inherent in individuals and inseparable from their nature (in antithesis to their conscious knowing and willing). This bond is their product. It is a historic product. It belongs to a specific phase of their development. The alien and independent character in which it presently exists vis-à-vis individuals proves only that the latter are still engaged in the creation of the conditions of their social life, and that they have not yet begun, on the basis of these conditions, to live it. It is the bond natural to individuals within specific and limited relations of production. Universally developed individuals, whose social relations, as their own communal [gemeinschaftlich] relations, are hence also subordinated to their own communal control, are no product of nature, but of history. The degree and the universality of the development of wealth where this individuality becomes possible supposes production on the basis of exchange values as a prior condition, whose universality produces not only the alienation of the individual from himself and from others, but also the universality and the comprehensiveness of his relations and capacities. In earlier stages of development the single individual seems to be developed more fully, because he has not yet worked out his relationships in their fullness, or erected them as independent social powers and relations opposite himself. It is as ridiculous to yearn for a return to that original fullness [22] as it is to believe that with this complete emptiness history has come to a standstill. The bourgeois viewpoint has never advanced beyond this antithesis between itself and this romantic viewpoint, and therefore the latter will accompany it as legitimate antithesis up to its blessed end.)
I'm sort of just quote-dumping here, but these are some great sections for clarifying misunderstandings I've come across in reading Marx : the social is independent of the individual, and alienation is a stage in seeking control over the social -- the original fullness that we might dream of cannot come back, either, because we now depend upon the world market. We were raised in an environment which taught us to become industrial citizens: if we "returned to how things were" we'd be peasants or hunter gatherers, and a great deal of the population would die off because those means of production are not able to support a population the size of what we have now.
For Marx he's always pointing out that these relationships are not natural, because they are different from how they were (feudal), and so the bourgeoisie, like every class which has ruled the world, sees itself as the end of history when it's just a moment in history.
Ye olde appearance/reality distinction -- the social
appears natural because the individual has no control over the natural, but is born into a world with such and such social realtionships already at play. But
in reality, the social relationship is much larger than our immediate surroundings, and our immediate surroundings, as well as ourselves as individuated people with personal bank accounts (the individual right to own property), are the product of social forces.
A particular expenditure of labour time becomes objectified in a definite particular commodity with particular properties and a particular relationship to needs; but, in the form of exchange value, labour time is required to become objectified in a commodity which expresses no more than its quota or quantity, which is indifferent to its own natural properties, and which can therefore be metamorphosed into – i.e. exchanged for – every other commodity which objectifies the same labour time. The object should have this character of generality, which contradicts its natural particularity. This contradiction can be overcome only by objectifying it: i.e. by positing the commodity in a double form, first in its natural, immediate form, then in its mediated form, as money. The latter is possible only because a particular commodity becomes, as it were, the general substance of exchange values, or because the exchange values of commodities become identified with a particular commodity different from all others. That is, because the commodity first has to be exchanged for this general commodity, this symbolic general product or general objectification of labour time, before it can function as exchange value and be exchanged for, metamorphosed into, any other commodities at will and regardless of their material properties. Money is labour time in the form of a general object, or the objectification of general labour time, labour time as a general commodity. Thus, it may seem a very simple matter that labour time should be able to serve directly as money (i.e. be able to furnish the element in which exchange values are realized as such), because it regulates exchange values and indeed is not only the inherent measure of exchange values but their substance as well (for, as exchange values, commodities have no other substance, no natural attributes). However, this appearance of simplicity is deceptive. The truth is that the exchange-value relation – of commodities as mutually equal and equivalent objectifications of labour time – comprises contradictions which find their objective expression in a money which is distinct from labour time.
This is an interesting paragraph to me because it highlights what "contradictions" means by Marx. Money is a concrete which resolves contradictions -- that's really interesting. "contradiction" is still a notion I'm suspicious of within the general wheel-house, because the rules for thinking dialectically are very far from clear to me, and are likewise easily subject to abuse because of that. Don't like a conclusion you've drawn? Just think dialectically about it, comrade!
;)
Here I'm noticing how the concrete object resolves conceptual contradictions from a time period before -- so money comes about because we have division of labor which segments the population into roles which could not survive on their own, yet they don't produce commensurable goods. If you have 2000 pairs of shoes at the end of the day, while you are one hell of a shoe crafter, you don't have the things you want. You're reliant upon all the other laborers to do their part, and exchange their goods: basically the need for money. Hence why we have all the talk about time-chits -- I take it that it was thought to be a viable replacement to capital, where Marx is clearly coming down against that, saying that capital takes us to a better place than we were, while simultaneously laying the groundwork for the possibility of a new society).
***
Through all the parenthetical notes it's easy to get lost in just what Marx is talking about and why, so I'm going to post the conclusion:
This much proceeds from what has been developed so far: A particular product (commodity) (material) must become the subject of money, which exists as the attribute of every exchange value. The subject in which this symbol is represented is not a matter of indifference, since the demands placed on the representing subject are contained in the conditions – conceptual determinations, characteristic relations – of that which is to be represented. The study of the precious metals as subjects of the money relations, as incarnations of the latter, is therefore by no means a matter lying outside the realm of political economy, as Proudhon believes, any more than the physical composition of paint, and of marble, lie outside the realm of painting and sculpture. The attributes possessed by the commodity as exchange value, attributes for which its natural qualities are not adequate, express the demands made upon those commodities which ϰατ᾽ ἐξοχήν [36] are the material of money. These demands, at the level to which we have up to now confined ourselves, are most completely satisfied by the precious metals. Metals as such [enjoy] preference over other commodities as instruments of production, and among the metals the one which is first found in its physical fullness and purity – gold; then copper, then silver and iron.
So eat it, Proudhon!
I'm going to be real -- I totally skipped part a where he's going into why different metals couldn't be used as money, thereby scientifically demonstrating his conclusion. And I only skimmed part b.
d, though, has some interesting parts I'm slowing down and reading now. I like this clear statement about money:
But first let us note that what is circulated by money is exchange value, hence prices. Hence, as regards the circulation of commodities, it is not only their mass but, equally, their prices which must be considered. A large quantity of commodities at a low exchange value (price) obviously requires less money for its circulation than a smaller quantity at double the price. Thus, actually, the concept of price has to be developed before that of circulation. Circulation is the positing of prices, it is the process in which commodities are transformed into prices: their realization as prices. Money has a dual character: it is (1) measure, or element in which the commodity is realized as exchange value, and (2) means of exchange, instrument of circulation, and in each of these aspects it acts in quite opposite directions. Money only circulates commodities which have already been ideally transformed into money, not only in the head of the individual but in the conception held by society (directly, the conception held by the participants in the process of buying and selling). This ideal transformation into money is by no means determined by the same laws as the real transformation. Their interrelation is to be examined.
Also pushes against some of the We-Intentions notes I put before; maybe because here he's talking about money in its ideal character in addition to its real character?
But mostly I like Marx's clear statement on the dual character of money, that it is both the means of exchange and measure of value.
One of the things I think that was "lost" in dropping Marx is looking for a material analogue that connects economics to the sciences. If economics is a science, as Marx holds, then it must have some measurable natural quantity -- hence Marx positing labor-time as the measurable quantity which all commodities share in common. Not that the price is in these units, it's not -- but with the discussion about money from before, it should be seen that since money is itself also just another commodity, nothing is explained by saying it's a medium of exchange. Of course it is, but what Marx is trying to understand is
why it is a medium of exchange -- how is it that value, objectively (scientifically) increases? And for it to increase, you'd have to first say what it is, which for Marx is labor-time (though price
tracks accreted concrete labor time, too -- so price is a measure, though its value fluctuates with its market)
A quote about ideal/real:
If exchange values are ideally transformed into money by means of prices, then, in the act of exchange, in purchase and sale, they are really transformed into money, exchanged for money, in order then to be again exchanged as money for a commodity. A particular exchange value must first be exchanged for exchange value in general before it can then be in turn exchanged for particulars. The commodity is realized as an exchange value only through this mediating movement, in which money plays the part of middleman. Money thus circulates in the opposite direction from commodities. It appears as the middleman in commodity exchange, as the medium of exchange. It is the wheel of circulation, the instrument of circulation for the turnover of commodities; but, as such, it also has a circulation of its own – monetary turnover, monetary circulation. The price of the commodity is realized only when it is exchanged for real money, or in its real exchange for money.
Also, a good quote to hammer, again, how Marx's theory of capitalism depends upon an account of exchange
The circumstances which determine the mass of commodity prices to be realized, on the one hand, and the velocity of circulation of money, on the other hand, are to be examined later. This much is clear, that prices are not high or low because much or little money circulates, but that much or little money circulates because prices are high or low;
All the previous to just say how monetary policy isn't all you need to look at.
Hrm, I'm thinking I'm going to call it there today. Tomorrow, finish before the lecture. I'm probably going to restart at the beginning of part D... I can feel the reading fatigue setting in and I'm starting to speed up.
:D
(Top of Page 186 in Penguin Grundrisse)