(bright music)
- We ended without talking about money's four functions.
Money as a measure of value, as a means of circulation,
as a store of value and as a means of payment.
There are other related functions like standard of price.
Standard of price simply means what you're paying in,
so and so many dollars.
The price will be counted in dollars.
The price will be counted in gold.
That's a function of the money.
It tells you that you're not gonna be paying
in calorie shells or,
locks of your hair.
That's as a standard of price.
As a measure of value
it's more substantial.
The measure of value is talking
about not the particular content of the measure of value,
that is the price.
The price is the content of the measure of value.
It just tells you that money functions to measure value.
Okay?
Marx is not gonna talk about how you arrive
at specific prices
and it turns out the factors involved in this specific price
are too much for even him to calculate
or anyone to calculate in advance.
There are many factors, it's highly contingent.
They go up and down,
but value is still the main determinant.
Makes up the body of the price
and the the clothing of the price changes minute by minute,
day by day.
You can get to where he works that out in volume three.
So, if you stick with me for the next couple of years.
Money as a measure of value
is related to money as a standard of price.
It's because that money
has stepped out of the commodity world, become independent
and serves only now its main function
as being the value of those commodities,
as being able to hold the value,
as being able to transport the value
and also being able to measure the value in its units.
(clears throat)
So, first he talks about a measure of value
as values, form of appearance.
The determining reflection,
the value mirror for labor time.
Money as the measure of value allows the value
of any commodity to appear just like the equivalent formed.
It is an equivalent.
It's the universal equivalent.
It is the mirror.
So, if you wanna know what the value of something is,
you can't give me more of that thing.
It would be ridiculous to say
the value of a banana is a banana,
or the value of a ton of iron is a ton of iron.
You have to give it either in something else
or when the system becomes complex enough,
you give it in money
and the money will tell you what the value is,
tell you that there is value and will represent that value.
So, money as a measure of value becomes the denominator
for all commodities.
Iron over gold, wheat over gold,
locks of hair over gold
and education over gold.
It's what he calls the value expression for a commodity.
So, you need to know these different terms.
Again, he's not really laying out
a scientifically finished system.
He's trying to figure out how it works
in the third or fourth iteration here,
and figure out how to express it to you
in ways you will understand.
So, if you think it's one analogy too many
or one opposite phrase too many,
you can just leave them aside.
But money is the value expression for a commodity.
It is the money form of that commodity
and that's what measure of value means.
It both represents the value
and it represents the amount of value,
which is the most important
and only quality of value is that it has an amount.
One thing that happens here, however,
is commodity gets a money name
or money gets a money name like pounds
and you say, what is the value of this commodity?
Well, it's worth so and so many pounds
or it's worth so and so many dollars.
This money name,
things have a name, they have a form
and they have a content.
For Marx, this is the way his philosophical vocabulary
is being developed.
A name,
a form, and a content.
The money name,
and he's a little bit suspicious of names,
they can do both things.
They can express something,
but they can also conceal something
and the money name conceals this entire process.
We say 10 bucks, 10 bucks.
I'll give you this thing for 10 bucks.
Gimme that thing for 10 bucks
and the 10 bucks comes to stand in
for the whole ontological machination
that makes something into a value.
Money is a real concealer
and you should remember that what expresses also conceals
because it only expresses something.
It's very particular capitalistic,
semiotics or capitalistic aesthetics
is always made to express something in particular
and hide the rest.
(clears throat)
Money as a means of circulation.
We're just about to overcome all of these.
These are, by the way, not things that Marx invented,
they're things that he found in political economy
and he's about to do a critique of it,
but calling them insufficient for understanding capital.
Any of them can be working in other systems and were,
the way they work together,
plus one extra factor, the extra,
the more the surplus,
which is what the capital system is aiming for its purpose.
Constitutes his critique of political economy.
They forgot where the more comes from.
All of this just explains value in an equivalent system
that circulates around and doesn't make any more of itself.
So, we're working between chapters three and four.
Chapter four is one of my favorite chapters,
really revelatory,
especially in the last four or five pages.
But we need to understand how these work so we can see
how central money is to the capitalist economy,
capitalistic economy,
and how it changes its nature.
So, second, money has been traditionally
a means of circulation.
It facilitates the form change
or metamorphosis of commodities
that mediates the social metabolism.
This is page 79.
Marx says this.
"Money is a means or a medium or a mediator,
a facilitator.
Without it, things couldn't circulate"
and so you need a certain amount of money
in circulation all the time,
so the deals can be happening,
the trades can be happening all over.
If there's insufficient money, people can't trade
because they're not gonna suddenly become barterers.
This is related but different function of money.
Under capital, things take on different functions,
and in economics things take on different functions.
In economies,
money is a means of circulation.
As a means of circulation, it,
produces a contradiction.
Here's what he says, let's take a look at this.
I'm looking at page 79 as means of circulation, 78.
He gives the form of circulation
as an ellipse,
which is the geometric corollary
of what he calls a real contradiction.
Here's one contradiction.
When a body is both falling toward another body
and falling away from it,
the ellipse is one of the forms of motion
through which this contradiction
is just as much realized as resolved.
And this is what happens in the circulation form.
Money is moving away and coming back at the same time.
It takes the form of an ellipse.
(clears throat)
Value is moving away and coming back at the same time.
In so far as I trade one thing for another,
the value moves along with that thing,
but it also comes back to me in a different form.
You could call this a contradiction unfolded in time.
Here we're talking about the philosophical ideas in play.
But nonetheless, if at the very instant of a trade
you said this value is both in the money
and in the commodity, it would be it's an oddity.
There has to be a moment in which it's in both of them
and then switches.
There is a ontological contradiction there,
and he wants to play that out.
Circulation he calls a moving contradiction.
What you have, I want what I have you want,
the value that I have transfers to you,
the value that you have transfers to me,
value moves in these eccentric ellipses.
Sandra.
- Where's the contradiction?
- The contradiction is that for a moment at least
the value is going in both directions.
- How does that non fiction?
- Well, it can't,
value doesn't double itself just out of nowhere.
- But there there are two commodities, right?
There's the double of value.
- Mm-hmm. - Half of it is going,
yeah, who is gonna other place.
- No, it's not half of it going, it's the whole.
- Yeah, the whole of one and the whole of the other.
- That's right, but at a moment they switch.
So, he thinks of this as a contradiction,
is a real contradiction.
That's one way to think of the transformation
or the transfer of value as a real contradiction.
I have the value now you have the value,
you have the value now I have the value.
How did it become naturalized
to think that that makes sense?
Where is the thing that's moving between the two?
There is no actual transfer that takes place.
That the physical transfer.
- While you're exchanging commodities.
- Let's keep going
and see if we can get a better handle on this.
He calls it also social metabolism.
That is taking something that's locked inside something else
and making it available
to be used in a different part of society.
This is what happens with the value in one thing,
which is not useful to me as I give it to someone else
for whom it is a value.
He calls it social metabolism
where these things are getting processed.
Another analogy he uses is digestion.
These are things becoming digested.
(clears throat)
And if you think about circulation as a kind of metabolism
on the analogy of a body,
you can also think about the rate of metabolism.
That is that things not only have to get transferred,
but if they get transferred at a certain speed,
you need more of them.
Like my nemesis, skinny people who can eat a lot.
You need more of it and it has almost no consequence.
Da.
(clears throat)
All right.
Money as a means of circulation works in this formula,
which is the formula of exchange economies.
This is famous.
People have taught this formula for 150 years.
It's kind of beautiful that Marx can boil everything down
to a simple formula or a simple visual.
But then it's not so simple
because here's the contradiction right there.
It's actually happening simultaneously.
When I sell my commodity to you for money,
you give your money to me for the commodity.
This is a kind of heuristic
or an artificial unfolding
of what happens like this.
So, the money doubles there for a minute.
This is a simultaneous thing
and you can see also that,
let's see,
it could go on,
right?
You have one transaction,
a second transaction.
This is how circulation works in simple circulation.
(clears throat)
When you get money for your commodity, as you know,
the value that's in this commodity has changed forms.
It comes in a different form altogether.
This is a change that's absolutely crucial
for the capital system
just as it's crucial for other not fully capitalist systems
that use a trade economy.
One thing you start to get here in this section,
you get even more in the next chapter,
is the picture of an economy as an immense network of trades
that are going on all at once in a fairly chaotic fashion.
Except they all have to have this form
and to some degree this commodity
has to be more or less the same.
Say it is iron for money
and money for, let's see what are we doing here?
A money for iron, that's that one thing.
So, then the iron goes to something else.
Let me think about that.
(clears throat)
What he's showing you above all here is how the sale
is different than the purchase in its perspective.
A purchase is turning a money into a commodity
and a sale is turning a commodity into money.
In a purchase, prices he calls the bedroom eyes
with which commodities wink at money.
It's a beautiful line.
And it implies the kind of power and seduction
and attraction that's involved in this.
You look at a price and you think,
my money is attracted to that price.
My money is very close to that price.
I might even have something left over for lunch.
I'll buy it.
But you see also here a kind of schizophrenia
where the seller is also a buyer.
The seller is a buyer of money,
and the buyer is also a seller.
The buyer is a seller of money.
Yeah, the buyer's a seller of money.
(clears throat)
And in this way we begin to see
how every economic activity turns into a circuit
that has to be closed.
The seller takes their money
and goes invest it in something they need.
The buyer takes their banana
and reproduces their labor-power.
It's a kind of perpetual motion machine
and this is one of the characteristics of the capital system
that is not characteristic of feudalism or other things,
although in all economic systems, you need to reproduce.
You need to reproduce your own energies,
you need to reproduce the society.
It doesn't have to become restless endless notion.
Circulation, in case you wanna know, is taken up,
exploded and developed in volume two,
which I recommend you reading.
If you look at pages 86 to 87,
you have here a really clear initial interpretation
of how circulation changes space and time.
First of all,
if you look in the middle of the second full paragraph,
starting with commodity circulation differs
from the direct exchange of products,
not only in terms of form, but also in its essence.
He says in the middle, "We see here how the exchange
of commodities bursts the individual
and local limits that go
with the direct exchange of products,
thereby advancing the metabolization of human labor.
On the other hand,
a whole network of natural social connections develops
through commodity circulation.
One that human actors involved can't control.
The weaver can sell his linen only
because the farmer has already sold his wheat.
The drunk can sell his bible.
Ha ha ha.
Only because the weaver has already sold his linen.
The distiller can sell his Eau-de-vie only because the drunk
has already sold the water of everlasting life and so on."
Marx's never tires
of ridiculing certain aspects of religion.
Drunk priests who needed a buck to buy their schnapps,
maybe not in the best taste,
but he was not always in the best taste.
What happens with circulation?
With circulation space spreads out,
the limits of a society spread
to almost unlimited spatial size.
Watch the expense.
Look at the title of that TV show.
Did you ever watch that show "Expense?"
They do mining in the outer belts
where they have a bunch of wage slaves
who do all the mining, who then rebel.
(clears throat)
Time also changes because my time
is totally dependent on when you can sell your product.
'Cause I can't sell my product to you
until you sell your product to Austin, for example.
This is called turnover times
and time becomes the measure of turnovers,
and this impinges on us.
This is like the new seasons, the seasons of capital.
It's no longer the harvest, it's the turnover.
A new calendar, a new clock,
the clock to begin with, Richard.
- So, like is time contractors is (indistinct)
- I don't know if it's as simple
as to say time is contracted and space is expanded
because space is also abrogated completely
by virtual networks.
Time becomes much more critical,
much more in need of calculation,
but not calculable in a simple clock format.
Because there's so many sets of dependencies,
you can't really fully calculate it.
So, time is incalculable, let's say in a human life
because you don't know when you're gonna die.
So, you live in a species not of infinity
as a certain romantic imaginary would have it.
But confusion and in determination, right?
Could be tomorrow, could be whenever.
This is not the time of capital.
The time of capital is not the time of existence.
Sorry, Martin Heidegger.
You can try to be a living existent under capital,
but you're likely to have to go to work in the meantime.
There's a lot to say about that.
It is important to understand
that money as a means of circulation,
if you didn't have money, if it didn't serve this function,
we would have a different universe,
a different cosmology, different space
and time pressures on ourselves.
(clears throat)
It also gets right into the center of beings.
Sorry, again, Martin Heidegger, page 87.
There is a kind of schizo tendency in capital
to split things apart,
like a thing becomes a purchase thing and a sold thing.
Those are not the same thing at all.
A sold thing could be used for its use value.
It might be resold,
but in simple circulation,
we're not talking about capital yet.
So, the person who buys it uses it.
A thing that is sold
is a couple of steps away from use value.
It is still a value.
The identity of things gets broken.
Space and time get transformed.
This is the recipe for a set of crises
in which the things don't arrive on time.
The money doesn't arrive on time.
Space becomes an obstacle rather than a facilitator.
You can see here on the bottom of page 87,
he mentions for the first time
a very important word for Marx.
He spent his whole life tracking crises,
real crises, monetary crises, overproduction crises,
natural crises like weather,
and was interested in finding out, as you know,
where the internal tendencies towards crises were
in the capital system.
He was convinced that if there wasn't gonna be a revolution,
there were certainly gonna be crises that wounded capital
and maybe even brought it down.
Although he never saw that in a fateful way,
despite some Marxist readings of this book,
there was no prediction
that within a certain amount of generations
a crisis would happen and capital would fall.
This is the philosophical explanation
of a crisis in the bottom of 87.
I just wanna point it out to you.
If things that complete each other internally
and thus aren't independent,
become externally, independent past a certain point,
then their unity will make itself felt with great force
by way of a crisis.
So, money and commodities
are absolutely internally dependent on one another.
If you take all the money out
of the system one way or the other,
that's a crisis,
that acts as though money is independent.
This is already leading towards the definition of capital,
which is not just money or value,
but money in constant circulation
and value in constant transformation for a certain purpose.
Does that make sense?
That's a very abstract view of a crisis.
We can talk about how crises happen otherwise, yes.
- Yeah, I heard actually his circuit, right?
So, it looks like the C, it mixes
that CMC will represent that there's some depend,
but like circuits that added in it,
because we get to there'll be C prime,
C prime prime, C prime prime, right?
There could be a sacrificial way the trinity of one.
But I guess my question is to what extent
or at what level do we start, right?
What level the owners of commodities
or the owners of money say, okay,
there's a point where I no longer need a commodity
and I want to like see if my body, right?
That's my first question.
And then the second question-
- Death. - To do with-
- That's my answer.
- What's the difference?
I don't know if Marx says this,
but I don't know what's the difference
between commodity circulation and barter?
The barter system (indistinct) makes that distinction.
- Yeah, no, no, he certainly makes that distinction.
The first question is when does this commodity exchange
or commodity circulation stop?
And it only stops when the whole society is destroyed
and it stops for an individual when they're dead.
It has to keep going.
That is one of the basic assumptions of Marxist system
that individuals need to reproduce their life forces
and societies need to reproduce their individuals
and their life forces interdependently.
'Cause my life forces depend on all of you
and yours all depend on me and each other.
Your individuality is not separable.
That would be another thing that if you separated it out,
it would be a big crisis.
That is if,
libertarianism were not such a ridiculous fantasy,
if you could actually carry it out
and everyone severed themselves from everyone else,
everyone would die.
So, it is libertarianism is not just a death wish,
but a murderous wish.
AJ.
- So, capital has a tendency
to split couple things into their kind of independent parts
and crises arise when that split happened.
- No, what one definition of a crisis
is when the capital system can't keep going.
So, it must keep going
and keep these interdependencies alive.
Your second question was about the difference
between the circulation of commodities and barter.
Barter is not according to Marx circulation,
it's not circular.
It doesn't send something out to get something back.
Well, it does actually.
But it doesn't circulate in society.
It goes just usually between individuals.
So, I would as a barterer, barter each one of my what?
Pens to individuals who have individual wants for them.
That is not circulation.
Circulation is where someone trades something to me
and I trade that to someone else.
Yep.
- So, does Marx explain
the evolution from barter to circulation?
- There is no evolution from barter to circulation,
at least historically,
they're just different systems.
Yep, circulation comes into play
when a society is so big that is big enough
and the form simply takes hold.
Both of those are true.
So, it's contingent,
but also there's some necessity in there,
that one producer couldn't get all that they want
from bartering their own thing.
But that doesn't happen because barter develops.
That happens for all sorts of other reasons.
Does that make sense?
Population growth, ideas,
trial and error.
The strange success of the idea of capital
in the 15th century for trading across large distances,
the historical forces
and contingencies,
accidents that make it possible
that the rollercoaster,
that the perpetual motion machine of capital gets started
are not part of the perpetual motion machine.
There is no necessity that capitalism
would have inaugurated, none whatsoever.
And you'll see that in later chapters.
It did.
Once it got going, it consumes everything
and its necessity takes over.
That's the problem really.
Yeah. - Yeah, you just-
- Another question out.
So it looks to me like from Marx
the difference between circulation and barter will be
that whereas in the barter system
there's a kind of restriction of place and time
as you mentioned earlier
in circulation there are restriction,
circulation goes beyond presents.
- Yeah.
And the name for that lack of restriction is money.
So, it's not just an ideal lack of restriction,
it is a material lack of restriction.
We have this technology called money
that's used in this particular way
and as he'll say in commodity circulation,
the money is constantly moving in an eccentric path.
It moves from this person to that person,
and then from this person to that person,
will have a very different circulatory
movement under capital.
- But this is not the capitalist.
- We're not a capital yet.
We're in a kind of threshold form,
which is commodity circulation in an exchange market.
But no one wants the capital difference yet,
which is getting more from the same.
A totally absurd requirement, which it turns out is a lie.
Okay.
He spends a while here talking
about the circulation of money.
It's very important that money circulate too,
because insofar as commodities change places with money,
money has to be there
for these commodities to change places.
And even though the reason commodities are sold
is because of their use value, I need it.
The reason they're sold
is because money is there to make them go.
So, which of these reasons wins out?
Well, in an exchange economy, money does
or it comes to look like it does.
And so we have phrases like money is power.
Money makes the world go round.
It does make the world go round.
Of course there would be no world to go round
if we didn't make commodities
that people could use to reproduce their powers,
and to just enjoy them.
I love a good commodity,
sometimes too much.
In the commodity system,
commodities move towards consumption.
Money moves away from its starting point
and they move towards consumption.
Marx wants you to be absolutely clear,
however that commodities move money,
not the other way around.
Money in fact is a commodity.
It has value.
Somebody made it.
If nobody made it, it would be valueless like air.
Without the commodity there'd be no system.
Marx says, despite the appearance
that money makes the world go round,
commodities are prime movers.
He talks about the need
to have a certain amount of money in circulation
and to relate the amount of money in circulation
to the speed by which it circulates.
You can have less money in circulation if it goes faster,
obviously 'cause it makes its way
to the other transactions more quickly.
Okay, quickly these other ones.
Well, money has to store value because of the temporality
in an exchange economy.
When I'm waiting for something to come in,
I have to have the money for it.
So, it has to keep the value that it's representing.
This is one of its functions.
So, long as I have the money give or take,
given inflation and other things,
which is another reason it should be put into circulation.
If it's put into circulation, it can absorb inflation.
If it's taken out of circulation
is just sitting in the bank,
it will deplete along with inflation.
It has to be a store of value as well.
These are separate functions, though they're related,
insofar as it's a measure of value,
it can be a store of value.
Insofar as it's a means of circulation,
well, really everything derives
from it's being a measure of value.
I wanna mention this too
because it relates to the other aspect
that he brackets out here, which is credit.
Money has to be the accepted means of payment
when you take a loan.
If they give you a loan of your car
and you go to pay it back in bananas,
well, you can imagine.
This by the way, gives you in an important set of passages
on page 105,
the genesis of the specific type of capitalist wealth.
There's no wealth in capitalism,
even though people talk about it.
There's only capital.
We'll see that in the next chapter.
In so far as it's wealth, it's been taken out of circulation
and it's steadily becoming less wealthy.
Ask Warren Buffet.
You gotta have it all moving, all invested,
otherwise it loses.
Is this the page I want?
In so far as money stores value
and can be a means of payment,
it's worth accumulating.
Also in so far as it's a future means of circulation,
so in fact, these three go together really well.
As a future means of circulation,
as a store of value and as a means of payment,
I can accumulate, but my accumulation
is called a reserve fund.
There's no treasure store.
There's no dragon there sitting on its treasure
for eons and eons.
As it steadily goes down in value,
people look at it and be like, what are all these trinkets?
Imagine if you kept like all the old Marx,
well maybe they're worth something, I dunno.
The idea that money can be stored,
value can be stored in money,
shows you the form of wealth
and why it's important for certain people
to hoard under the capital system.
It's not for their enjoyment,
it's not for their higher purchasing power.
Even though these super wealthy people
are constantly buying luxury things,
it's so that they can put it back into circulation
and it can act as a measure of value, just to say that.
It becomes a market power,
not purchasing power, not private power.
It's a means of storing market power.
That I wanted to mention to you
because the transformation of wealth is really important.
Capital is not wealth,
it is value in circulation for a purpose,
but that value needs to be sometimes put aside as a reserve,
never as wealth for the individual person always
as a bet on future investments.
Yeah, Thomas.
- So, you say that it must always,
any accumulation must always go back
or at least that's what the individual must intend to,
but in practice must actually always go back
into circulation or can it be just accumulated?
- Well, it can be,
but it runs the risk of becoming worthless
in a crisis, for example.
If you own capital in a crisis,
let's say you own a factory,
it's possible that after the crisis that becomes,
goes back up to its value.
But in a crisis, the money you can just burn it.
Yeah. - Yeah.
- Yes, please.
- I'm a bit confused because this CMC circulation
is also possible in a pre-capitalist society
that uses money.
- Yes. - It's not money
that makes the capital, right?
- No, but this circulation by means of money as a mediator
is crucial for capital.
Capital is like a parasite.
It takes older things and it makes them do its bidding.
- But the process
we're talking about is not unique to capitalism.
- It's unique to capitalism.
The question is, is this process unique to capitalism?
It's unique to capitalism in its totality and scope.
For example,
a feudal society did have some circulation of commodities.
There were trades people
and there were some exchange of money,
but there were other ways
to get your needs fulfilled as well.
This takes over completely.
Alright, we understand a little bit about money,
now we have to understand money and simple circulation.
We have to understand
how money gets transformed into capital.
The main thrust of this chapter,
because this is a critique of political economy,
is to show all the wrong opinions
about where capital comes from.
It does not come from circulation.
He's gonna demonstrate this to you by showing
that it's impossible that it comes from circulation.
I just wanna read because I love his polemical voice.
This is the last two pages of the chapter 148 to 149,
in which he makes fun.
Ridicules the people who think
that profit comes from circulation.
"The sphere of circulation or commodity exchange
within whose limits
the movement of buying and selling labor-power occurs,
is in fact a veritable Eden of innate human rights.
You can tell already since he's got religion in there
that he's making fun of somebody.
What reigns is exclusively freedom, equality,
property and Bentham.
Freedom because only the free wills of the buyer
and seller of a commodity,
for example, labor-power determine how these figures act.
They enter into business dealings
as free persons equal before the law, ha.
The end result is the contract
that represents a joint legal expression of their wills.
Equality, because they interact only as commodity owners
and exchange an equivalent for an equivalent, ha.
Property, because each owner does whatever he wants
with only what is his.
Ha.
Bentham.
Bentham, poor Jeremy Bentham,
because each cares only about himself.
The only force that brings the two parties together
and into a relation with each other as self concern,
private interests, personal gain.
This is the view of the market that he wants to knock down.
That profit comes from the market
that it is selfishly motivated that everyone is equal in it.
Not that they're unequal
because if they had equal access to the market,
they would be equal.
But the market is inherently unequal,
not because of the market,
because of the way production works.
This is where he tells us
that we will leave together with the money owner
and the labor-powers owner will leave the surface area
and follow them into the hidden place of production.
The rest of the book will be about the way surplus value
is made in production
and then the origins of the capital system.
So, before we move on, we need to understand
why this is not true,
why he feels so free at the end of this chapter
to ridicule these people.
One simple definition of capital
is that it is the products of labor held through time.
The products of labor held through time.
So, if I make something and I hold it through time,
it becomes worth more.
This is a funny economist's idea of capital.
I just hold onto it.
Maybe that happens with some things
if they disappear off the face of the earth,
but insofar as they're still there,
it shouldn't change at all just by holding it.
Of course it has to hold its value, we know that.
But it's more than this.
It's more than value.
It's more than the super sensible
quasi metaphysical substance
that we've been talking about.
In fact, he's gonna ask you to go beyond.
First he asks you to go beyond the commodity
and see it as double.
Then he asks you to go beyond physical and useful things
to see them as the bearers
of quasi metaphysical objects called value.
Then he asks you to think that labor is double,
which he is gonna now exploit.
Then he wants you to understand
how commodity exchange makes money happen and this blows up
and changes space and time
and changes the identity of a simple object,
and it has to keep going or else everyone starves.
Now he's gonna ask you to put all that aside to overcome it
and see where the more comes from.
Because under capital we need constantly more
to keep the minimum of life going.
All of social life in the capital system
is dedicated to making this more.
In youth societies more comes generally from nature.
The idea is that nature is abundant
and we can just take some more,
which is also perhaps now clearly a pernicious idea,
but it's nature's repetitions
that give more in a youth society.
It gives more humans, it gives more crops,
it gives more air and water,
and there's also a sense
that there's a cycle there where we're giving back our water
and food in a certain form and our bodies in the end.
This is an idea.
This is not the only way,
you have to think about the exchange
between humans and nature,
but it has a kind of virtuous cycle.
And Marx makes this as an assumption
that there is a virtuous cycle
and then there is a vicious cycle.
(clears throat)
How do we explain this different kind of more
that is capital.
Boswell, economists explain it from circulation.
We look at the capital system and we see circulation.
We say, you know, I can sell to Alan my computer,
and I'm like $3,500,
why not?
And he's gullible and he'll say, sure.
But then when Alan goes to buy lunch,
he's gonna be about, I don't know, $2,000 in the hole.
Where's it gonna come from?
It has to come from someone else.
This is Marx's argument.
He's gonna then pay that much less for a car
or that much less for his lunch,
or his poor partner is gonna be like,
where's or where's all the money gone Alan?
We needed to redo the roof
on our beautiful 18th century house.
Yeah.
All of the extra that you could get
from circulation Marx argues, gets passed on.
Someone will pay it and it comes out to the same,
because the circulation system
is an exchange of equivalence.
You can't get more out of the same.
But they're saying we get more out of the same.
There is, he says,
a formal difference
between CMC and MCM.
We still don't know how you get more out of the same,
but he's gonna tell us
that there's a certain kind of circulation
that is necessary for it.
Now if you look at this,
they're embedded in one another.
Obviously this is an infinite series,
so what's the difference?
It turns out if you cut this series here,
it's totally different than if you cut this series here,
which you're an initial starting point
is determines whether you're in a capitalist system
or a commodity exchange system.
There is a difference in content lurking
in the form, he says.
Okay, let's just give you the outline
and then we'll fill in the details next time.
'Cause we have only a little time left.
The commodity circulation system starts with production
and ends with consumption.
It is only about use values
and in a system where use values
are all that we're concerned with, you can't get any profit.
The extra will be passed on one way or the other.
In this system, the commodity exchange system,
the same piece of money changes place twice.
I give to Alan 10 bucks
and Alan gives 10 bucks to Samuel.
I won't use you in as an example forever, I promise,
to get something else.
The money changes hands twice.
Money moves in this eccentric fashion
because I have a need and Alan has a need
and Samuel has a thing that he wants
and I have a thing that Alan wants.
You can see where the money goes just to exemplify it.
Marx says this, it's pretty clear,
the money goes from me to Alan to Samuel.
That's not capitalism.
The money has to be back to me.
(clears throat)
And this produces a certain kind of disposition
in the buyer.
The buyer says it's fine to give money away
if I get what I want.
I don't need to see that money back.
Everyone is this kind of buyer fundamentally,
Marx would say.
Our capitalist economy, our high capitalist economy
is still a commodity circulation system.
We still need to get our needs
and they're in some way primary,
but not for the capitalists.
There's two primaries here.
And again, the ultimate purpose is consumption
and Marx says this is an end outside
of the circulation system.
You take your thing outside, you devour it,
you sleep with it, you watch it on TV,
it doesn't get traded again.
The MCM circuit starting with money, totally different.
Obviously your disposition is, Hey, gimme that money back.
What are you gonna get if you give your money away
for a commodity that you don't need?
You need to get money out of that.
You need to get your money back.
In this version, the same commodity changes place twice.
I give money to Alan for his commodity
and then what happens?
- And you sell it?
- Then I sell the commodity.
- To get more money.
- To get money, to get more money, exactly.
That's right, okay, sorry.
I'm not an economist,
so all this stuff is like, why should I waste my time?
Sorry.
That's right, exactly.
Then I get my money back by selling it on, by selling it on.
So, the commodity has an eccentric movement,
because I don't need it.
What I need is money.
This is a beautiful illustration of the switch of values,
what nature would call
the transvaluation of values under capital.
You can see this is not just a technical or formal switch.
This is a switch in psychology, in valuing,
in everything that's gonna be important in the society.
When money flows back to its starting point,
it is a circuit that has to be completed.
If I buy something from Alan,
and he has the money,
there's no reason he has to buy anything.
If he's satisfied, he can just, I don't know,
burn the money in his fireplace if he wants.
That's not the case for a money circuit.
The ultimate purpose for the money
is that it returns to its starting point.
So, money has a different purpose.
It's not to satisfy wants and needs.
Oddly though, the buyer ends up
with exactly what they started with.
It seems like nothing happened,
and this is where this formula is not sufficient,
and we need to discover
where this mysterious change delta comes from,
and we'll talk about that next time.
(tense music)