WEBVTT 00:00:00.449 --> 00:00:03.948 (lively orchestral music) 00:00:12.419 --> 00:00:13.720 - This is where we've come 00:00:15.089 --> 00:00:18.332 by way of certain mediating doublets. 00:00:27.059 --> 00:00:31.503 Right, we saw how values are made by this peculiar, 00:00:33.869 --> 00:00:34.859 what do you call it? 00:00:34.859 --> 00:00:38.222 Union of incompatibles I would like to call it. 00:00:43.380 --> 00:00:44.590 We saw how 00:00:56.850 --> 00:00:59.530 concrete labor becomes the bearer 00:01:01.350 --> 00:01:04.739 'cause it makes use values of abstract labor, 00:01:04.739 --> 00:01:07.229 which has to go through. 00:01:07.230 --> 00:01:08.340 You'll notice that these, 00:01:08.340 --> 00:01:10.740 I don't like to call this dialectics exactly 00:01:10.739 --> 00:01:12.390 because it isn't exact. 00:01:12.390 --> 00:01:14.852 Hegel really wanted dialectics to be exact. 00:01:16.109 --> 00:01:19.200 The kinds of pairings 00:01:19.200 --> 00:01:20.700 and the kinds of transformations 00:01:20.700 --> 00:01:23.850 that happen here are not regular. 00:01:23.849 --> 00:01:25.979 But nonetheless, this will help you see a little bit 00:01:25.980 --> 00:01:27.302 what has happened so far. 00:01:28.829 --> 00:01:30.719 Forms of value, what are they? 00:01:30.719 --> 00:01:31.552 Do you remember? 00:01:33.540 --> 00:01:34.623 The two main ones. 00:01:37.950 --> 00:01:39.040 The equivalent form 00:01:40.680 --> 00:01:42.693 and the relative form. 00:01:44.849 --> 00:01:46.379 They work together in a certain way 00:01:46.379 --> 00:01:48.060 to make money precipitate out. 00:01:48.060 --> 00:01:50.850 You can see how the way the result comes out 00:01:50.849 --> 00:01:53.519 of this strange doubling process 00:01:53.519 --> 00:01:55.352 is not the same in every case. 00:01:57.959 --> 00:01:59.559 Thank you for turning that down. 00:02:02.909 --> 00:02:05.459 This is not all that happens, but it's a kind of a skeleton. 00:02:05.459 --> 00:02:08.409 And then the question is, how do you get from here to here? 00:02:13.709 --> 00:02:17.209 And that's what we're talking about today. 00:02:19.080 --> 00:02:23.673 In the end, we get a formula, which is something like this. 00:02:30.669 --> 00:02:32.252 And it also goes... 00:02:33.569 --> 00:02:34.402 Let's see. 00:02:37.680 --> 00:02:41.223 It goes in all dimensions at once, right? 00:02:42.090 --> 00:02:44.400 Not exactly sure how, but there is a... 00:02:44.400 --> 00:02:47.189 It's probably like 00:02:47.189 --> 00:02:51.659 this money gets used for something else altogether. 00:02:51.659 --> 00:02:54.719 In any case, I would want to just point out to you again 00:02:54.719 --> 00:02:57.930 that the use process 00:02:57.930 --> 00:03:02.552 and the capital process are the same and different. 00:03:04.020 --> 00:03:08.280 This is commodity exchange. 00:03:08.280 --> 00:03:11.763 This is money exchange. 00:03:13.740 --> 00:03:15.570 This is what Marx will focus on 00:03:15.569 --> 00:03:18.709 as the signature of capitalism, 00:03:18.710 --> 00:03:20.070 of the capital system. 00:03:20.069 --> 00:03:21.599 He calls it the general formula, 00:03:21.599 --> 00:03:23.609 and it will have a lot of problems. 00:03:23.610 --> 00:03:26.130 It can't dispense with commodity exchange, 00:03:26.129 --> 00:03:28.500 especially because what this produces 00:03:28.500 --> 00:03:33.300 is everything we consume to keep going, 00:03:33.300 --> 00:03:35.550 but our consumption is now... 00:03:35.550 --> 00:03:39.453 So this is, you could call it a consumption formula, 00:03:40.439 --> 00:03:44.159 and you could call this a production formula, 00:03:44.159 --> 00:03:46.022 but it's a production of value. 00:03:47.460 --> 00:03:49.320 And this is a consumption 00:03:49.319 --> 00:03:54.319 for the purposes of surviving. (laughs) 00:03:55.469 --> 00:03:59.210 Surviving becomes the handmaid 00:03:59.210 --> 00:04:01.323 of the production of value. 00:04:03.449 --> 00:04:05.673 You survive in order to produce value. 00:04:07.259 --> 00:04:12.239 This is how, incidentally, the commodity formula 00:04:12.240 --> 00:04:15.240 and the money formula are the same and different 00:04:15.240 --> 00:04:17.939 at the same time as the economic structure 00:04:17.939 --> 00:04:20.129 of society is the same and different 00:04:20.129 --> 00:04:21.600 as the social structure of society. 00:04:21.600 --> 00:04:25.470 You begin to see that social things like surviving, 00:04:25.470 --> 00:04:28.800 what you have to eat, what you have to live with, 00:04:28.800 --> 00:04:32.160 and producing value 00:04:32.160 --> 00:04:34.620 come out of the particular change 00:04:34.620 --> 00:04:37.322 from one economy to the next, 00:04:38.279 --> 00:04:41.312 from a commodity economy to a money or value economy. 00:04:46.290 --> 00:04:49.560 There's another feature here that's really important, 00:04:49.560 --> 00:04:52.780 that a merchant 00:04:58.649 --> 00:05:01.139 looks at the capital system from here. 00:05:01.139 --> 00:05:03.689 A merchant, an investor, and a businessperson, 00:05:03.689 --> 00:05:07.170 and all the economists that Marx was arguing against, 00:05:07.170 --> 00:05:09.753 they look at it from this particular chain. 00:05:10.589 --> 00:05:12.299 They don't look at it from here. 00:05:12.300 --> 00:05:14.460 This is what Marx is adding. 00:05:14.459 --> 00:05:17.069 These are the operations that go on 00:05:17.069 --> 00:05:20.219 to turn products 00:05:20.220 --> 00:05:22.173 into capital. 00:05:27.600 --> 00:05:29.790 The economist and the businessperson looks at it 00:05:29.790 --> 00:05:32.043 from circulation, 00:05:34.230 --> 00:05:37.080 and they don't see what Marx calls the difference 00:05:37.079 --> 00:05:38.942 in content lurking in the form. 00:05:40.980 --> 00:05:44.970 This form seems the same until you break it in two, 00:05:44.970 --> 00:05:46.260 and then it's drastically different. 00:05:46.259 --> 00:05:49.209 You have different starting points and different endpoints, 00:05:51.029 --> 00:05:53.309 and the difference in content is significant. 00:05:53.310 --> 00:05:56.579 One concentrates on producing commodities 00:05:56.579 --> 00:05:58.620 and supporting consumption. 00:05:58.620 --> 00:06:00.810 The other concentrates on producing money 00:06:00.810 --> 00:06:02.552 and supporting value production. 00:06:08.879 --> 00:06:10.050 You need the one for the other, 00:06:10.050 --> 00:06:11.850 but you don't need the other for the one. 00:06:11.850 --> 00:06:15.330 This is where socialism would enter into something more. 00:06:15.329 --> 00:06:17.849 It wouldn't dispense with money necessarily. 00:06:17.850 --> 00:06:19.379 It might not even dispense with value, 00:06:19.379 --> 00:06:21.629 but it certainly would dispense with capital. 00:06:26.879 --> 00:06:28.319 I love this. 00:06:28.319 --> 00:06:31.052 Humanists don't have so many blackboards usually. 00:06:33.149 --> 00:06:35.526 I just want to point out that there is a simple... 00:06:35.526 --> 00:06:37.860 Oh, this is not what I want. 00:06:37.860 --> 00:06:42.449 There is a simpler formula, commodity to commodity, 00:06:42.449 --> 00:06:45.360 in which you might have the mediation of money, 00:06:45.360 --> 00:06:48.750 but that would be money of account only, 00:06:48.750 --> 00:06:52.560 where you would say a banana's worth three tires. 00:06:52.560 --> 00:06:53.639 Three would be money there, 00:06:53.639 --> 00:06:56.159 but it just keeps the account of the value 00:06:56.160 --> 00:06:59.460 so you know how much you need to give of bananas for tires 00:06:59.459 --> 00:07:00.602 or tires for bananas. 00:07:02.430 --> 00:07:03.263 Here, 00:07:05.610 --> 00:07:07.129 you have money as... 00:07:10.829 --> 00:07:14.979 Remember the different functions of money? 00:07:14.980 --> 00:07:17.879 Money as a standard of value or money of account. 00:07:17.879 --> 00:07:20.339 So this, if there was money in here, 00:07:20.339 --> 00:07:22.986 it would just be like, I'd say, 00:07:22.987 --> 00:07:25.290 "You know, give me 20 bananas for those tires." 00:07:25.290 --> 00:07:28.189 20 would be the money of account or the standard of value. 00:07:31.019 --> 00:07:33.959 This would be money as a means of circulation. 00:07:33.959 --> 00:07:34.799 You need it in there. 00:07:34.800 --> 00:07:37.020 It would actually facilitate the handing over 00:07:37.019 --> 00:07:38.639 because, as you remember, 00:07:38.639 --> 00:07:43.082 CM is separated in space and time from MC. 00:07:44.610 --> 00:07:46.083 These are really the same M. 00:07:47.730 --> 00:07:50.009 Someone gives money for something, 00:07:50.009 --> 00:07:52.980 and that person would go and buy another commodity 00:07:52.980 --> 00:07:54.120 at a different space and time. 00:07:54.120 --> 00:07:58.079 So without money in that size of economy, 00:07:58.079 --> 00:07:59.969 you could not do your economy. 00:07:59.970 --> 00:08:01.470 You couldn't get your bananas. 00:08:02.370 --> 00:08:04.649 So we're talking very different sizes of economy, 00:08:04.649 --> 00:08:06.179 but you can see how the different functions 00:08:06.180 --> 00:08:10.079 of money are used in different kinds of economies, right? 00:08:10.079 --> 00:08:12.689 Money of account could just be a number. 00:08:12.689 --> 00:08:14.490 It could be you're counting these things in dates, 00:08:14.490 --> 00:08:15.900 but no dates have to change hands. 00:08:15.899 --> 00:08:17.429 You don't even have to have dates there. 00:08:17.430 --> 00:08:19.650 You're just like, "Okay, this is worth 20 dates. 00:08:19.649 --> 00:08:21.179 That's worth 30 dates. 00:08:21.180 --> 00:08:23.370 I'll give you, you know, 00:08:23.370 --> 00:08:27.536 I'll give you 2/3 of my thing for your other thing." 00:08:28.649 --> 00:08:31.589 This, money takes on a different function. 00:08:31.589 --> 00:08:32.970 It's very odd that the same thing 00:08:32.970 --> 00:08:34.230 can be functionally different, 00:08:34.230 --> 00:08:36.980 but this is the way Marx is beginning to see the world. 00:08:38.159 --> 00:08:41.009 Money still functions as a money of account 00:08:41.009 --> 00:08:42.269 or standard of value, 00:08:42.269 --> 00:08:46.893 but it has to be there in some sort of form to mediate, 00:08:48.090 --> 00:08:52.200 to stretch space and time so that the transaction can occur. 00:08:52.200 --> 00:08:53.850 There was a question which I missed. 00:08:53.850 --> 00:08:55.379 Yeah, Tomas. 00:08:55.379 --> 00:08:58.529 - For the first one we see C? 00:08:58.529 --> 00:08:59.362 - Yeah. 00:09:00.240 --> 00:09:01.933 - What sort of economy is that? 00:09:01.933 --> 00:09:03.449 - I mean, it could be like a barter economy, 00:09:03.450 --> 00:09:06.629 but nonetheless you could still have a standard of value, 00:09:06.629 --> 00:09:08.340 and normally you would, 00:09:08.340 --> 00:09:10.470 but because you could trade the thing for the thing 00:09:10.470 --> 00:09:12.180 because you were close enough, 00:09:12.179 --> 00:09:13.259 you'd only need to refer 00:09:13.259 --> 00:09:15.513 to the standard of value notionally. 00:09:17.220 --> 00:09:20.370 - On the side notation, referring to C and C, right? 00:09:20.370 --> 00:09:23.370 - This is a commodity economy, which is larger, 00:09:23.370 --> 00:09:25.230 and you need money to mediate. 00:09:25.230 --> 00:09:26.430 And there is something like, 00:09:26.429 --> 00:09:29.793 there's value in a more robust sense. 00:09:32.399 --> 00:09:34.653 So you notice that in this, 00:09:40.500 --> 00:09:44.389 in the middle one, money is a mediator. 00:09:44.389 --> 00:09:46.649 In this, you have a special verb. 00:09:46.649 --> 00:09:48.687 You say, "I spend money." 00:09:49.950 --> 00:09:52.983 You spend money to buy, 00:09:54.000 --> 00:09:58.200 and you gain money when you sell, 00:09:58.200 --> 00:09:59.730 and the exchange is equal. 00:09:59.730 --> 00:10:03.123 You end up with the same value on either side. 00:10:04.200 --> 00:10:05.520 Does that make sense? 00:10:05.519 --> 00:10:08.159 It starts with production and ends with consumption. 00:10:08.159 --> 00:10:10.019 And it's only about use values, 00:10:10.019 --> 00:10:12.903 although use values are mediated by value. 00:10:17.009 --> 00:10:18.059 And as we said last time, 00:10:18.059 --> 00:10:19.979 the same piece of money changes place twice, 00:10:19.980 --> 00:10:22.019 and it moves in an eccentric fashion 00:10:22.019 --> 00:10:26.403 away from the original owner of the money. 00:10:27.840 --> 00:10:30.090 The disposition of each buyer, as I said last time, 00:10:30.090 --> 00:10:31.649 is, "I don't need my money. 00:10:31.649 --> 00:10:33.299 I want a banana. 00:10:33.299 --> 00:10:34.132 Take it. 00:10:34.133 --> 00:10:35.410 Do what you want with it." 00:10:40.440 --> 00:10:43.143 In this, the commodity is the mediator for money. 00:10:44.250 --> 00:10:47.220 It's a vehicle to bring the money back to you, 00:10:47.220 --> 00:10:50.133 and money returns in a reflux. 00:10:52.350 --> 00:10:54.029 The commodity is a mediator, 00:10:54.029 --> 00:10:56.100 and money, as Marx said, is the alpha 00:10:56.100 --> 00:10:57.870 and omega of this religion. 00:10:57.870 --> 00:11:00.722 It begins, it creates, and it redeems. 00:11:03.120 --> 00:11:04.379 In this, money is not spent. 00:11:04.379 --> 00:11:06.269 It is advanced. 00:11:06.269 --> 00:11:08.673 This is what capitalists call it. 00:11:10.200 --> 00:11:11.790 I don't think I've ever advanced money. 00:11:11.789 --> 00:11:15.000 That's why I guess I'm in the situation I'm in, 00:11:15.000 --> 00:11:17.730 unless you count advancing it to my teenager. (laughs) 00:11:17.730 --> 00:11:22.200 There's no reflux there except his joy and health, 00:11:22.200 --> 00:11:23.552 and, right, that's okay. 00:11:24.690 --> 00:11:27.270 In this case, the same commodity changes place twice, 00:11:27.269 --> 00:11:28.562 but the money comes back, 00:11:30.330 --> 00:11:32.700 and this makes circulation 00:11:32.700 --> 00:11:35.070 into a circuit that has to be completed. 00:11:35.070 --> 00:11:36.780 It's not commodities flying off 00:11:36.779 --> 00:11:39.929 into people's mouths or backyards. 00:11:39.929 --> 00:11:43.079 It is money returning to the account 00:11:43.080 --> 00:11:44.613 of the original advancer. 00:11:47.730 --> 00:11:49.920 But the problem, as Marx says, 00:11:49.919 --> 00:11:51.689 is that the buyer ends up with the same... 00:11:51.690 --> 00:11:54.450 I mean, the capitalist ends up 00:11:54.450 --> 00:11:56.640 with the same thing that they started with. 00:11:56.639 --> 00:12:00.720 Give money away, you get a commodity. 00:12:00.720 --> 00:12:02.580 You sell that commodity, you get the money back 00:12:02.580 --> 00:12:05.280 because everything trades at its value. 00:12:05.279 --> 00:12:07.829 This, he says, is absurd, 00:12:07.830 --> 00:12:09.810 and yet all of the people 00:12:09.809 --> 00:12:11.729 who only see the circulation system, 00:12:11.730 --> 00:12:14.220 who see that as the source of value, 00:12:14.220 --> 00:12:18.210 imagine that out of the same, you can get more. 00:12:18.210 --> 00:12:22.410 This is the fantasy, pernicious fantasy, 00:12:22.409 --> 00:12:25.949 of the traders, 00:12:25.950 --> 00:12:27.450 the business owners, 00:12:27.450 --> 00:12:30.690 and the economists who take their perspective 00:12:30.690 --> 00:12:32.260 or their standpoint 00:12:33.539 --> 00:12:35.913 because the general formula, as you know, 00:12:38.399 --> 00:12:39.896 like "The Wizard of Oz," 00:12:42.990 --> 00:12:44.669 is MCM prime, 00:12:44.669 --> 00:12:48.929 or MC delta M, delta meaning change. 00:12:48.929 --> 00:12:50.969 There has to be a change in the advance. 00:12:50.970 --> 00:12:52.050 Otherwise, why would you do it? 00:12:52.049 --> 00:12:54.809 Because the use value of money is to bring more money, 00:12:54.809 --> 00:12:57.559 just like the use value of a seed is to bring a carrot. 00:12:58.649 --> 00:13:01.379 If your stuff doesn't grow... 00:13:01.379 --> 00:13:03.059 My one foray into gardening, 00:13:03.059 --> 00:13:05.819 I tilled this giant garden when I was in college, 00:13:05.820 --> 00:13:06.840 planted the whole thing, 00:13:06.840 --> 00:13:09.753 and one sprout of tomatoes came up in the compost heap. 00:13:11.820 --> 00:13:16.353 So, I was a very bad gardener/capitalist. 00:13:17.700 --> 00:13:20.643 A supplement has to enter the picture somewhere, 00:13:21.509 --> 00:13:24.539 and Marx wants to argue that this supplement 00:13:24.539 --> 00:13:27.269 cannot possibly enter in circulation 00:13:27.269 --> 00:13:29.429 no matter how high you sell your stuff 00:13:29.429 --> 00:13:32.309 because as we said last time, 00:13:32.309 --> 00:13:34.019 and we'll say over and over, 00:13:34.019 --> 00:13:38.370 all overages and all underages are passed on. 00:13:38.370 --> 00:13:40.919 Someone will make it up out of somewhere 00:13:40.919 --> 00:13:44.163 because the economy in these terms is a zero-sum game. 00:13:45.149 --> 00:13:48.209 If I buy dear, 00:13:48.210 --> 00:13:49.980 then I have to get something else cheaper 00:13:49.980 --> 00:13:51.960 'cause I only have a limited amount. 00:13:51.960 --> 00:13:53.940 If someone gets something for more, 00:13:53.940 --> 00:13:55.140 they can pay more for something, 00:13:55.139 --> 00:13:57.419 and someone's gonna raise the price. 00:13:57.419 --> 00:14:00.269 Supply and demand equal out over time. 00:14:00.269 --> 00:14:04.389 You cannot get what Marx will now call surplus value 00:14:05.370 --> 00:14:07.440 out of the circulation sphere. 00:14:07.440 --> 00:14:10.920 The sphere of circulation doesn't make more of anything. 00:14:10.919 --> 00:14:12.959 It just passes around the same. 00:14:12.960 --> 00:14:16.143 You must have it, but it's not the productive source. 00:14:17.490 --> 00:14:21.149 It's the location of the realization of value. 00:14:21.149 --> 00:14:22.860 But the productive source has to be elsewhere. 00:14:22.860 --> 00:14:24.930 We don't know yet where it is. 00:14:24.929 --> 00:14:27.242 It could be in your dreams, in your fantasies. 00:14:32.820 --> 00:14:35.460 Those people who live in a commodity society, 00:14:35.460 --> 00:14:38.673 which is all of us, we all live in a commodity society, 00:14:39.899 --> 00:14:41.906 we say, "Well, you can't eat money." 00:14:44.429 --> 00:14:46.889 And those people who live in a value society, 00:14:46.889 --> 00:14:48.360 which we all do, 00:14:48.360 --> 00:14:51.210 it's just layered on top of the commodity society, 00:14:51.210 --> 00:14:53.697 you say, "We can't eat our commodities." 00:14:54.690 --> 00:14:56.670 You see the difference? 00:14:56.669 --> 00:14:58.319 The people who are out for value want 00:14:58.320 --> 00:14:59.610 to preserve their commodities 00:14:59.610 --> 00:15:01.529 to make value before they're eaten. 00:15:01.529 --> 00:15:04.682 If you eat what you produce, you're not a capitalist. 00:15:06.299 --> 00:15:08.939 So he needs a new form change. 00:15:08.940 --> 00:15:10.620 He needs a kind of form change 00:15:10.620 --> 00:15:12.990 that brings more from the same 00:15:12.990 --> 00:15:14.822 or finds a new source. 00:15:17.220 --> 00:15:21.000 Under capital, all of these processes transform 00:15:21.000 --> 00:15:23.519 to be headed towards M prime, 00:15:23.519 --> 00:15:25.769 headed towards this more or this plus, 00:15:25.769 --> 00:15:27.153 the plus of value. 00:15:29.850 --> 00:15:31.710 Now if we ask what capital means, 00:15:31.710 --> 00:15:34.860 we go back to the definition of one very good economist, 00:15:34.860 --> 00:15:36.033 Kit Sims Taylor. 00:15:36.929 --> 00:15:40.379 Capital is value held over time. 00:15:40.379 --> 00:15:42.090 We start to think, "Well, there's something missing 00:15:42.090 --> 00:15:43.590 from that." 00:15:43.590 --> 00:15:45.330 I've held a lot of things over time, 00:15:45.330 --> 00:15:47.030 and they tend to lose their value. 00:15:48.809 --> 00:15:52.769 If capital is what brings more or the more that comes, 00:15:52.769 --> 00:15:54.122 it can't simply be that. 00:15:56.759 --> 00:15:58.860 What you need is a commodity, 00:15:58.860 --> 00:16:03.100 a special commodity that brings more than it costs 00:16:04.919 --> 00:16:07.173 because of its special qualities. 00:16:08.220 --> 00:16:09.990 A couple of stipulations. 00:16:09.990 --> 00:16:13.649 When you get to studying the capital system in these terms, 00:16:13.649 --> 00:16:16.559 you can no longer say profit until the very end. 00:16:16.559 --> 00:16:18.989 We're not concerned with the genesis of profit. 00:16:18.990 --> 00:16:22.680 The terms that Marx uses are capital and surplus value. 00:16:22.679 --> 00:16:24.899 Capital is made up of surplus value. 00:16:24.899 --> 00:16:26.669 Profit is mystified. 00:16:26.669 --> 00:16:29.339 It doesn't tell you anything about where it comes from. 00:16:29.340 --> 00:16:32.399 It doesn't even tell you that it's a surplus. 00:16:32.399 --> 00:16:34.049 This is huge. 00:16:34.049 --> 00:16:37.709 In a zero-sum system, where does the surplus come from? 00:16:37.710 --> 00:16:40.650 We know one place it comes from, nature, 00:16:40.649 --> 00:16:44.523 which is thought of in capitalism as a bottomless abundance. 00:16:45.360 --> 00:16:47.702 We know how this is not true in many ways. 00:16:50.931 --> 00:16:52.920 And in fact, all surplus will come from nature. 00:16:52.919 --> 00:16:56.099 It's just it also comes from the nature of human beings. 00:16:56.100 --> 00:16:57.873 That is their capacity to labor. 00:17:00.389 --> 00:17:01.222 Okay. 00:17:02.669 --> 00:17:04.923 Capital is not just value held through time. 00:17:06.359 --> 00:17:10.829 It is value that is in movement here, 00:17:10.829 --> 00:17:13.859 but it's not just in movement through space and time. 00:17:13.859 --> 00:17:16.052 It does have to circulate to get realized. 00:17:17.609 --> 00:17:19.889 It's in movement within itself. 00:17:19.890 --> 00:17:23.940 It transforms within itself in an increasing way. 00:17:23.940 --> 00:17:25.563 It valorizes itself. 00:17:27.359 --> 00:17:30.809 We go from a production process here 00:17:30.809 --> 00:17:32.429 in which you produce a commodity. 00:17:32.430 --> 00:17:33.960 You use money to get it somewhere, 00:17:33.960 --> 00:17:35.880 and someone consumes it. 00:17:35.880 --> 00:17:36.780 This would be, 00:17:36.779 --> 00:17:39.539 the production of commodities would start this out 00:17:39.539 --> 00:17:42.339 to a system in which you are producing value 00:17:44.609 --> 00:17:46.712 that has to come back with more, 00:17:48.930 --> 00:17:51.120 and Marx calls that valorization. 00:17:51.119 --> 00:17:53.159 So every time you see valorization, 00:17:53.160 --> 00:17:56.110 it's where something is getting what it didn't have before. 00:17:57.599 --> 00:17:58.432 And Marx 00:18:00.119 --> 00:18:03.119 holds to Occam's razor, 00:18:03.119 --> 00:18:07.589 or holds to Spinoza and Leibniz. 00:18:07.589 --> 00:18:10.862 He believes everything has to have a sufficient reason. 00:18:12.539 --> 00:18:15.809 If you have more, it has to come from somewhere. 00:18:15.809 --> 00:18:17.252 Nothing comes from nothing. 00:18:18.900 --> 00:18:20.730 You can argue with this, but Marx doesn't. 00:18:20.730 --> 00:18:24.460 That's his instrument to show that the economists are silly 00:18:26.369 --> 00:18:28.559 or blind or... 00:18:28.559 --> 00:18:30.690 And you will notice how many of them he quotes 00:18:30.690 --> 00:18:32.227 in the footnotes and in the body like, 00:18:32.227 --> 00:18:34.660 "Condillac and others who say, 00:18:34.660 --> 00:18:37.620 'Yes, the one who sells something gets more back, 00:18:37.619 --> 00:18:39.299 and the one who buys something gets more back.'" 00:18:39.299 --> 00:18:42.539 And Marx was like, "Huh, that's interesting." (laughs) 00:18:42.539 --> 00:18:45.240 A lot of fantasies among the people 00:18:45.240 --> 00:18:48.450 who are thinking about the economy because it's a mystery. 00:18:48.450 --> 00:18:52.049 It was the biggest mystery, and Marx solved it, 00:18:52.049 --> 00:18:53.639 and he solved it by giving names 00:18:53.640 --> 00:18:55.380 to the parts that nobody had thought of, 00:18:55.380 --> 00:18:56.730 one of which is surplus value. 00:18:56.730 --> 00:18:58.620 Now we have to ask where it comes from, 00:18:58.619 --> 00:19:00.782 which is in our reading this week, 00:19:02.430 --> 00:19:04.230 but I want to make sure you understand this stuff 00:19:04.230 --> 00:19:05.063 before we go on. 00:19:05.063 --> 00:19:07.713 Questions while I sip my cold brew? 00:19:11.220 --> 00:19:12.870 You notice that the capitalist fuels 00:19:12.869 --> 00:19:16.173 are getting stronger and stronger? (chuckles) 00:19:18.779 --> 00:19:19.623 This all clear? 00:19:21.509 --> 00:19:23.670 - Does cold brew valorize? 00:19:23.670 --> 00:19:25.860 - Cold brew of course valorizes, yeah, 00:19:25.859 --> 00:19:28.132 by the poor guys who are pulling shots all day. 00:19:29.009 --> 00:19:29.910 - Is it monetized? 00:19:30.920 --> 00:19:34.410 - (laughs) No, I'm not invested, if that's what you mean. 00:19:34.410 --> 00:19:37.110 I always think it would be good to invest in something, 00:19:37.109 --> 00:19:39.236 and I think, "How does one do that?" 00:19:40.319 --> 00:19:42.769 - Will you say more about (speaks faintly) topic? 00:19:45.720 --> 00:19:47.039 - Sure. 00:19:47.039 --> 00:19:49.559 I will say also that I taught this book. 00:19:49.559 --> 00:19:52.802 In prison, one of the guys asked me if when they got out, 00:19:53.819 --> 00:19:56.250 they use it to start a business. 00:19:56.250 --> 00:19:58.410 You might learn how to invest. 00:19:58.410 --> 00:20:00.720 I mean, it is real economics, 00:20:00.720 --> 00:20:05.720 so you might learn how to invest here, but I resist. 00:20:06.839 --> 00:20:08.282 Why not profit? 00:20:10.470 --> 00:20:12.299 Because profit seems to be the thing 00:20:12.299 --> 00:20:16.113 that comes from trade. 00:20:16.950 --> 00:20:17.783 That's what it means. 00:20:17.782 --> 00:20:18.899 It seems to emerge 00:20:18.900 --> 00:20:21.423 at the moment where you're selling something. 00:20:22.559 --> 00:20:24.779 Profit is what you get back. 00:20:24.779 --> 00:20:27.242 Surplus value is what goes in. 00:20:28.230 --> 00:20:31.180 So if you're asking where's this extra coming from 00:20:32.724 --> 00:20:36.839 in a ontologically sufficient universe, 00:20:36.839 --> 00:20:39.149 then it has to come from somewhere, 00:20:39.150 --> 00:20:41.130 and profit denies that. 00:20:41.130 --> 00:20:44.940 Profit is the most mystified concept. 00:20:44.940 --> 00:20:47.037 Wait, there was a question up here. 00:20:47.037 --> 00:20:51.480 - Right, so my question is about value in society. 00:20:51.480 --> 00:20:54.450 When you're buying a commodity with money, 00:20:54.450 --> 00:20:56.109 and then you exchange the commodity, 00:20:56.108 --> 00:20:57.982 you know, and you leave it there, 00:20:57.982 --> 00:21:01.409 are you using the commodity as a store of value? 00:21:01.410 --> 00:21:02.243 - Yeah. 00:21:02.242 --> 00:21:05.692 - And so M prime is a newer value? 00:21:05.692 --> 00:21:07.139 - Uh-huh, it comes from somewhere, 00:21:07.140 --> 00:21:08.630 extra value. - Right, okay. 00:21:08.630 --> 00:21:09.463 - Yep. 00:21:09.462 --> 00:21:10.829 Yep, commodities store value too. 00:21:10.829 --> 00:21:13.769 If these things didn't hold value and preserve value... 00:21:13.769 --> 00:21:15.480 Now we're gonna see in the labor process 00:21:15.480 --> 00:21:17.190 how preserving the value 00:21:17.190 --> 00:21:20.880 of the semi-products that come in 00:21:20.880 --> 00:21:22.890 and also of your means of production, 00:21:22.890 --> 00:21:24.870 your tools and your equipment, 00:21:24.869 --> 00:21:28.949 is one of the chief jobs of the capitalist 00:21:28.950 --> 00:21:32.430 to ensure by/through two methods, 00:21:32.430 --> 00:21:36.029 discipline, called supervising, 00:21:36.029 --> 00:21:39.482 and propaganda, 00:21:40.410 --> 00:21:42.033 Marx calls real subsumption. 00:21:43.049 --> 00:21:47.879 You preserve your stuff at work much more carefully 00:21:47.880 --> 00:21:49.830 and with much less effort on the part of the owner 00:21:49.829 --> 00:21:51.153 when you love your work. 00:21:53.910 --> 00:21:56.130 - So you say value and mainly while, I guess, 00:21:56.130 --> 00:21:57.780 still talking like simple society. 00:21:57.779 --> 00:22:00.389 You say this added value, this valorization, 00:22:00.390 --> 00:22:02.460 can't come from circulation. 00:22:02.460 --> 00:22:04.413 - Oh, well, Marx says that. 00:22:08.099 --> 00:22:10.740 - But if we bring something from a market in which, 00:22:10.740 --> 00:22:12.375 say, if we bring a commodity from a market, right, 00:22:12.375 --> 00:22:13.952 in which it's very easy to produce 00:22:13.952 --> 00:22:16.202 to a place where it's much harder to produce, 00:22:17.250 --> 00:22:21.000 then doesn't value simply come from that circulation? 00:22:21.000 --> 00:22:23.789 Or are we saying that, like, transporting the commodity... 00:22:23.789 --> 00:22:26.609 Say we bring bananas from a very sunny place to a very cold. 00:22:26.609 --> 00:22:29.699 - You mean, imagine that, let's say, 00:22:29.700 --> 00:22:32.130 a shirt is made much more cheaply in Bangladesh? 00:22:32.130 --> 00:22:35.610 Just imagine (student speaks faintly) 00:22:35.609 --> 00:22:37.589 it's made more cheaply in Bangladesh than here. 00:22:37.589 --> 00:22:39.359 Yeah, it just means that the market switches 00:22:39.359 --> 00:22:40.979 to get all the fashion from Bangladesh, 00:22:40.980 --> 00:22:44.009 so you're not really comparing anything there. 00:22:44.009 --> 00:22:46.529 - But we're getting this delta M 00:22:46.529 --> 00:22:48.452 from moving something, right? 00:22:50.452 --> 00:22:52.470 Like, you bought it- - Well, yeah, I mean, it's... 00:22:52.470 --> 00:22:54.750 Well, you're getting the shirt from there, 00:22:54.750 --> 00:22:56.039 but you're no longer comparing it 00:22:56.039 --> 00:22:58.529 to shirts made in the US, for example, 00:22:58.529 --> 00:22:59.972 except as a luxury good. 00:23:01.170 --> 00:23:03.810 So there's no added value to getting it from there. 00:23:03.809 --> 00:23:05.190 It's just that when you go 00:23:05.190 --> 00:23:07.620 to a place where labor is much cheaper 00:23:07.619 --> 00:23:11.459 or technology is much more efficient, 00:23:11.460 --> 00:23:14.043 then the cost of production goes down. 00:23:15.630 --> 00:23:17.640 Sorry, Richard and then Tomas. 00:23:17.640 --> 00:23:19.470 - I'm trying to think about the relationship 00:23:19.470 --> 00:23:21.990 between production and consumption here 00:23:21.990 --> 00:23:24.720 because it's all in one circuit, basically, 00:23:24.720 --> 00:23:26.220 in throughout the society. 00:23:26.220 --> 00:23:30.990 So does circulation conceal production? 00:23:30.990 --> 00:23:33.599 - Yes, circulation conceals production 00:23:33.599 --> 00:23:35.730 and consumption, actually. 00:23:35.730 --> 00:23:37.113 In this circuit, 00:23:38.339 --> 00:23:40.349 the question is about production and consumption. 00:23:40.349 --> 00:23:43.449 In this circuit, Marx says consumption happens 00:23:44.930 --> 00:23:46.140 outside of circulation. 00:23:46.140 --> 00:23:48.333 This is for private consumption. 00:23:50.160 --> 00:23:52.521 I can't load this anymore, can I? 00:23:52.520 --> 00:23:53.354 Ah. 00:23:54.599 --> 00:23:55.619 It's big, the economy. 00:23:55.619 --> 00:23:56.792 You noticed? 00:23:57.960 --> 00:24:00.579 Private consumption 00:24:03.660 --> 00:24:04.493 here. 00:24:05.579 --> 00:24:08.339 In this, there's a kind of consumption, as you'll notice, 00:24:08.339 --> 00:24:10.352 that he calls productive consumption, 00:24:12.180 --> 00:24:16.740 which money uses to make a commodity 00:24:16.740 --> 00:24:18.480 to make more money, 00:24:18.480 --> 00:24:23.163 and that is raw materials and means of production. 00:24:24.210 --> 00:24:26.670 Those are consumed in the production process. 00:24:26.670 --> 00:24:28.623 So there's two types of consumption. 00:24:30.359 --> 00:24:31.709 It is true that circulation, 00:24:31.710 --> 00:24:36.120 at least historically for the economists, 00:24:36.119 --> 00:24:38.549 has concealed the abode of production 00:24:38.549 --> 00:24:39.839 or the place of production, 00:24:39.839 --> 00:24:41.429 and that's where we're going today. 00:24:41.430 --> 00:24:44.580 Marx makes it very dramatic in this version of the book. 00:24:44.579 --> 00:24:46.740 In other versions of the book, it's much drier. 00:24:46.740 --> 00:24:49.380 But he wanted this to captivate you. 00:24:49.380 --> 00:24:50.970 So he says, "We will now move 00:24:50.970 --> 00:24:52.947 into the hidden place of production." 00:24:53.849 --> 00:24:55.709 Production is hidden historically 00:24:55.710 --> 00:24:57.150 because economists have just thought 00:24:57.150 --> 00:25:00.509 that magically the more comes out of there. 00:25:00.509 --> 00:25:03.420 But it's also the case 00:25:03.420 --> 00:25:07.620 that circulation is very public, 00:25:07.619 --> 00:25:10.379 and production is hidden even by capitalists. 00:25:10.380 --> 00:25:11.760 It's locked behind doors. 00:25:11.759 --> 00:25:13.799 It's hidden for all sorts of reasons. 00:25:13.799 --> 00:25:17.039 So there's a factual material concealment 00:25:17.039 --> 00:25:18.182 that goes on as well. 00:25:19.259 --> 00:25:20.279 What of course is hidden 00:25:20.279 --> 00:25:23.940 because we didn't have the analytic tools to see it 00:25:23.940 --> 00:25:27.093 is the capital process in its real operations. 00:25:28.710 --> 00:25:32.039 Nobody had seen that before, not Ricardo, not Smith, 00:25:32.039 --> 00:25:33.332 certainly not Hegel, 00:25:36.329 --> 00:25:37.413 according to Marx. 00:25:39.779 --> 00:25:41.369 One more question, yeah. 00:25:41.369 --> 00:25:43.409 Tomas. - To the previous question, 00:25:43.410 --> 00:25:44.243 on value- 00:25:44.242 --> 00:25:45.146 - Yeah. - We'd need the (indistinct) 00:25:45.146 --> 00:25:46.439 and the dash. 00:25:46.440 --> 00:25:49.380 So when the conditions of productions of, 00:25:49.380 --> 00:25:52.680 we have a car that won't (indistinct) change, 00:25:52.680 --> 00:25:54.727 which is what today in like, yeah, 00:25:54.727 --> 00:25:58.083 "Financial Times" is called adding value, right, 00:25:59.039 --> 00:26:01.409 that's no longer the same commodity. 00:26:01.410 --> 00:26:04.650 What happens is that the commodity changes entirely anew, 00:26:04.650 --> 00:26:06.120 so that's all you can compare, 00:26:06.119 --> 00:26:07.739 yeah, right, wouldn't you say? 00:26:07.740 --> 00:26:10.019 - No, it's because the conditions of production. 00:26:10.019 --> 00:26:15.019 Once you start making cheap Xs in Mexico, 00:26:16.140 --> 00:26:17.250 it doesn't matter where it is, 00:26:17.250 --> 00:26:20.940 but it does obviously for the lives of the people there 00:26:20.940 --> 00:26:22.650 and international relations. 00:26:22.650 --> 00:26:25.200 But wherever it is that you're making a thing cheaper 00:26:25.200 --> 00:26:26.033 because labor is cheaper 00:26:26.032 --> 00:26:28.413 or because there's better technology, 00:26:31.440 --> 00:26:34.860 then everything switches to that source. 00:26:34.859 --> 00:26:35.692 So, 00:26:37.307 --> 00:26:39.957 it may be that it's cheaper for the people to buy it, 00:26:41.220 --> 00:26:43.623 for us to buy it here in a core economy. 00:26:44.519 --> 00:26:47.789 But, I mean, it's just like any other value production, 00:26:47.789 --> 00:26:49.409 just happened to move there, 00:26:49.410 --> 00:26:52.713 and the factors of production have changed. 00:26:53.819 --> 00:26:56.169 It doesn't change the way value is made at all. 00:26:57.674 --> 00:27:00.299 - It's also, like, one market. 00:27:00.299 --> 00:27:01.888 There aren't different markets, 00:27:01.888 --> 00:27:02.882 so it's just the socially necessary labor time. 00:27:04.310 --> 00:27:06.000 - Yeah, exactly, socially... 00:27:06.000 --> 00:27:08.700 So I'm trying to call it SNAALT 00:27:08.700 --> 00:27:10.799 with a kind of Swedish accent, 00:27:10.799 --> 00:27:14.167 socially necessary average abstract labor time, 00:27:14.167 --> 00:27:15.902 (laughs) SNAALT. 00:27:17.009 --> 00:27:19.680 So hold on to that one, but that's right. 00:27:19.680 --> 00:27:24.680 It's just that the parameters of SNAALT have changed, 00:27:24.990 --> 00:27:27.960 but anyone who wants to get a shirt 00:27:27.960 --> 00:27:30.633 has to compete with Bangladesh. 00:27:34.109 --> 00:27:34.942 Okay. 00:27:37.710 --> 00:27:39.809 We know that the main contradiction, 00:27:39.809 --> 00:27:41.849 what he calls a contradiction in the general formula, 00:27:41.849 --> 00:27:45.452 is that in the general formula, 00:27:47.670 --> 00:27:51.120 you have to somehow get more out of the same. 00:27:51.119 --> 00:27:52.412 That's the contradiction. 00:27:57.000 --> 00:27:59.282 We're looking at chapter four. 00:28:00.299 --> 00:28:02.519 If you take a look at the last four or five pages, 00:28:02.519 --> 00:28:03.962 they're very important. 00:28:09.569 --> 00:28:11.169 They start to tell you some of 00:28:14.549 --> 00:28:16.082 the real inputs here. 00:28:20.009 --> 00:28:23.970 Buying and selling labor power is an important section. 00:28:23.970 --> 00:28:26.519 This will be the special commodity 00:28:26.519 --> 00:28:30.240 that allows more to be added 00:28:30.240 --> 00:28:32.279 to the money that you circulate. 00:28:32.279 --> 00:28:36.423 That means, actually, that the more comes in here. 00:28:38.849 --> 00:28:40.379 It's the only place it can come in. 00:28:40.380 --> 00:28:41.970 It doesn't come in in consumption. 00:28:41.970 --> 00:28:44.430 How am I adding more to it when I consume something? 00:28:44.430 --> 00:28:46.529 In fact, I'm using it up. 00:28:46.529 --> 00:28:48.750 The value will be gone by the time I'm done, 00:28:48.750 --> 00:28:52.259 or slowly over the use of a hammer, 00:28:52.259 --> 00:28:54.573 I will waste the value of that hammer. 00:28:55.710 --> 00:28:57.180 It doesn't come in in circulation 00:28:57.180 --> 00:28:59.039 'cause that's just the exchange of equal values. 00:28:59.039 --> 00:29:02.250 There's no way I'm gonna give you my car, 00:29:02.250 --> 00:29:04.950 old and crappy as it is, for your banana. 00:29:04.950 --> 00:29:08.130 Sorry, you'll have to give me a few bushels 00:29:08.130 --> 00:29:09.513 of bananas, at least. 00:29:12.509 --> 00:29:17.509 The only place Marx says it can happen is in production, 00:29:17.700 --> 00:29:21.210 and particularly in one aspect of production, 00:29:21.210 --> 00:29:24.029 in the buying and selling of labor power. 00:29:24.029 --> 00:29:26.579 This is the only place the change of value can happen 00:29:26.579 --> 00:29:31.470 because of the schizoid nature of labor. 00:29:31.470 --> 00:29:32.793 Labor's double. 00:29:36.359 --> 00:29:39.990 This is really what makes capital the difference 00:29:39.990 --> 00:29:41.942 between labor power and labor. 00:29:43.859 --> 00:29:46.173 This you will have noticed from your reading, 00:29:48.420 --> 00:29:53.279 that like any commodity, 00:29:53.279 --> 00:29:56.067 the capacity to use the commodity 00:29:56.067 --> 00:29:58.799 and the using of commodity are different things. 00:29:58.799 --> 00:30:01.740 One is kind of stored in it, 00:30:01.740 --> 00:30:04.500 and the other is used up when you consume it. 00:30:04.500 --> 00:30:08.880 In fact, labor power is consumed when you're laboring. 00:30:08.880 --> 00:30:09.963 Does that make sense? 00:30:11.009 --> 00:30:13.420 There's no question that labor is a commodity 00:30:14.730 --> 00:30:17.039 in a market economy, right? 00:30:17.039 --> 00:30:18.599 It's a natural endowment. 00:30:18.599 --> 00:30:22.799 It's an enhanced endowment through skill-building 00:30:22.799 --> 00:30:24.480 and education and all of those things. 00:30:24.480 --> 00:30:27.779 It's a natural cultural/societal endowment 00:30:27.779 --> 00:30:30.482 that can be stretched and built, and waxes and wanes. 00:30:31.619 --> 00:30:33.029 But nonetheless, 00:30:33.029 --> 00:30:37.232 what makes this all go round is that it's traded. 00:30:39.210 --> 00:30:41.340 In fact, if you think of an economy, 00:30:41.339 --> 00:30:43.139 if I couldn't trade my labor power, 00:30:43.140 --> 00:30:45.690 if I couldn't use my labor power for trade, 00:30:45.690 --> 00:30:47.279 I wouldn't get anything back 00:30:47.279 --> 00:30:50.913 so that I could go to the supermarket, right? 00:30:52.170 --> 00:30:53.003 I must. 00:30:53.002 --> 00:30:55.319 My labor power has to become a commodity 00:30:55.319 --> 00:30:57.240 in a large exchange economy. 00:30:57.240 --> 00:31:00.539 Otherwise, I wouldn't have that thing I need to 00:31:00.539 --> 00:31:03.450 unless I started out with a huge amount of capital. 00:31:03.450 --> 00:31:07.590 But if I came into this world with nearly nothing, as I did, 00:31:07.589 --> 00:31:11.522 I have only my labor power to sell. 00:31:13.650 --> 00:31:17.043 And on the other side, commodity sales, 00:31:18.240 --> 00:31:21.660 capitalism requires someone with labor power 00:31:21.660 --> 00:31:23.370 to sell so that they can have money 00:31:23.369 --> 00:31:25.559 to buy the commodities that I'm making. 00:31:25.559 --> 00:31:27.779 Marx uses the example of the company store. 00:31:27.779 --> 00:31:28.829 You go to work. 00:31:28.829 --> 00:31:30.476 You make a, what, a shoe. 00:31:30.477 --> 00:31:32.759 And then of course to shoe your family, 00:31:32.759 --> 00:31:34.319 you need to go to your boss 00:31:34.319 --> 00:31:36.119 and buy the shoes at full price, 00:31:36.119 --> 00:31:38.429 even though you can make them. 00:31:38.430 --> 00:31:40.650 These are the ironies of the capital system. 00:31:40.650 --> 00:31:43.560 So if I didn't have labor power to sell, right, 00:31:43.559 --> 00:31:45.210 my being able to shoe my family, 00:31:45.210 --> 00:31:47.940 though I have the skills to make the shoes, 00:31:47.940 --> 00:31:51.303 is now mediated by labor power. 00:31:52.319 --> 00:31:53.153 I have this thing. 00:31:53.153 --> 00:31:58.022 I promise them I'm gonna give them X amount of my time. 00:32:00.779 --> 00:32:01.833 Does that make sense? 00:32:09.960 --> 00:32:14.460 The split that makes this not an economy 00:32:14.460 --> 00:32:17.130 for the laborer, but a schizonomy, 00:32:17.130 --> 00:32:20.100 if you want to be Deleuzian about it or something like that, 00:32:20.099 --> 00:32:23.490 what makes it for me as a worker a schizonomy 00:32:23.490 --> 00:32:27.692 is that I sell my labor power, but the owner gets my labor. 00:32:28.650 --> 00:32:31.230 What's the difference between labor and labor power? 00:32:31.230 --> 00:32:33.960 Labor power is what I promise as my capacity to do things, 00:32:33.960 --> 00:32:36.090 but labor is as much as they can get out of me 00:32:36.089 --> 00:32:39.512 in the time I've contracted to work, actual labor. 00:32:43.740 --> 00:32:47.220 My labor power is valued at its cost of reproduction, 00:32:47.220 --> 00:32:48.990 just like any commodity. 00:32:48.990 --> 00:32:51.660 What does it cost to produce my labor power? 00:32:51.660 --> 00:32:53.160 What are the factors in my labor power? 00:32:53.160 --> 00:32:54.310 Can you shout them out? 00:32:56.190 --> 00:33:00.212 Strength, it's a cost, but what builds strength? 00:33:01.200 --> 00:33:03.330 Food, sleep. 00:33:03.329 --> 00:33:06.389 So, a house, all of those things, right? 00:33:06.390 --> 00:33:07.570 This is called my 00:33:12.450 --> 00:33:13.410 means of subsistence. 00:33:13.410 --> 00:33:15.783 There's a lot of little monograms. 00:33:16.619 --> 00:33:17.549 My means of subsistence. 00:33:17.549 --> 00:33:21.220 So labor power is sold 00:33:22.440 --> 00:33:24.003 from my means of subsistence. 00:33:24.869 --> 00:33:26.669 But you see what the issue is here. 00:33:26.670 --> 00:33:30.690 The capitalist has to pay my means of subsistence 00:33:30.690 --> 00:33:34.232 and their means of subsistence out of my labor power. 00:33:36.359 --> 00:33:39.389 They have to pay for next year's contingencies 00:33:39.390 --> 00:33:41.009 out of my labor power. 00:33:41.009 --> 00:33:45.299 They have to hedge their bets against weather and thieves 00:33:45.299 --> 00:33:47.190 and the up and downs of the markets 00:33:47.190 --> 00:33:49.230 all out of my labor power. 00:33:49.230 --> 00:33:51.390 So that better be pretty elastic 00:33:51.390 --> 00:33:53.580 because it's not just gonna be... 00:33:53.579 --> 00:33:55.289 They're not just gonna be getting out of it 00:33:55.289 --> 00:33:56.343 what they pay me. 00:34:02.460 --> 00:34:04.470 A laborer lives a schizonomy 00:34:04.470 --> 00:34:06.539 in which their labor power is what is sold 00:34:06.539 --> 00:34:10.440 and that what they get is the cost to reproduce themselves. 00:34:10.440 --> 00:34:12.720 What they give, however, is the cost 00:34:12.719 --> 00:34:14.163 to reproduce the business, 00:34:16.650 --> 00:34:18.780 which might include a higher standard of living 00:34:18.780 --> 00:34:21.450 for the owner, but doesn't necessarily have to. 00:34:21.449 --> 00:34:23.750 The whole business depends on the value put in 00:34:24.989 --> 00:34:27.089 through actual labor. 00:34:27.090 --> 00:34:28.920 The value of labor power is determined 00:34:28.920 --> 00:34:30.363 by my wants and needs. 00:34:32.250 --> 00:34:36.420 It's worth saying that this is not a natural determination, 00:34:36.420 --> 00:34:37.860 but a historical determination. 00:34:37.860 --> 00:34:42.423 So if my wants and needs include an iPhone, 00:34:43.710 --> 00:34:46.409 what else, an umbrella, 00:34:46.409 --> 00:34:48.210 what do we need that are historical, 00:34:49.559 --> 00:34:52.139 socially determined rather than naturally determined? 00:34:52.139 --> 00:34:53.579 Huh? 00:34:53.579 --> 00:34:55.773 Tuition for your children, amen. 00:34:57.690 --> 00:35:00.179 That's right, the things I've done for tuition, 00:35:00.179 --> 00:35:01.730 future tuition for my children. 00:35:02.760 --> 00:35:04.230 Yep, depends on the society you live in. 00:35:04.230 --> 00:35:06.119 If you live in Argentina, where my partner is from, 00:35:06.119 --> 00:35:09.029 you don't save for tuition because the universities are? 00:35:09.030 --> 00:35:10.380 - Free. 00:35:10.380 --> 00:35:13.950 - You pay taxes, but the state has decided it wants 00:35:13.949 --> 00:35:18.159 to allow you to go to these extremely dilapidated buildings 00:35:19.349 --> 00:35:21.960 without a charge, right? 00:35:21.960 --> 00:35:23.519 So this list of wants 00:35:23.519 --> 00:35:27.869 and needs are not just, like, biological. 00:35:27.869 --> 00:35:29.789 I don't want you to think that any of this is natural. 00:35:29.789 --> 00:35:30.929 It's socially determined, 00:35:30.929 --> 00:35:33.902 and it might very well include a car, 00:35:35.159 --> 00:35:36.572 a state government, 00:35:38.190 --> 00:35:39.450 diapers for your kids 00:35:39.449 --> 00:35:41.789 rather than running around pooping all over the place. 00:35:41.789 --> 00:35:42.960 Yeah. 00:35:42.960 --> 00:35:46.470 - So labor power is based at the (indistinct), 00:35:46.469 --> 00:35:48.239 but it's in the (indistinct) sense, right? 00:35:48.239 --> 00:35:49.319 - Yeah. 00:35:49.320 --> 00:35:54.320 - And goods are priced as their SNAALT. 00:35:54.630 --> 00:35:55.463 - Yes. 00:35:56.309 --> 00:35:57.559 - How do we... 00:35:59.070 --> 00:36:01.590 There's gotta be a difference between 00:36:01.590 --> 00:36:04.110 like how we're pricing labor times 00:36:04.110 --> 00:36:05.220 and how we're pricing means, 00:36:05.219 --> 00:36:07.469 and how we're valuing labor power. 00:36:07.469 --> 00:36:08.302 - That's right. 00:36:09.420 --> 00:36:10.500 Yeah, you have to... 00:36:10.500 --> 00:36:13.260 Well, one of the main controls 00:36:13.260 --> 00:36:16.000 when we get to talking about 00:36:17.099 --> 00:36:19.409 relative surplus value later, 00:36:19.409 --> 00:36:21.389 you'll see that one of the main controls 00:36:21.389 --> 00:36:24.900 that a capitalist has to increase their surplus value 00:36:24.900 --> 00:36:29.309 is to diminish the cost of those goods 00:36:29.309 --> 00:36:32.222 that maintain the means of subsistence. 00:36:33.690 --> 00:36:35.460 So it doesn't help the capitalist 00:36:35.460 --> 00:36:37.619 to drive down prices anywhere, 00:36:37.619 --> 00:36:40.269 but it does help them to drive down the price of rice 00:36:41.460 --> 00:36:42.900 because that means they can reproduce 00:36:42.900 --> 00:36:44.730 the worker more cheaply. 00:36:44.730 --> 00:36:47.519 So there's a lot of pressures on the agricultural sector 00:36:47.519 --> 00:36:49.679 and other kind of infrastructure sectors 00:36:49.679 --> 00:36:52.739 for individual consumption to go down and down and down. 00:36:52.739 --> 00:36:55.649 Technologies in those parts of the economy 00:36:55.650 --> 00:36:59.733 actually help profits rise or surplus value increase. 00:37:00.809 --> 00:37:02.070 Richard. 00:37:02.070 --> 00:37:04.170 - Talking about labor power, 00:37:04.170 --> 00:37:06.539 and she says it's like all the capacities 00:37:06.539 --> 00:37:07.980 that exist in a person. 00:37:07.980 --> 00:37:11.579 But like, as one notices, like, an office worker, 00:37:11.579 --> 00:37:14.043 which is like typing on Excel, saying something, 00:37:16.800 --> 00:37:18.420 you know, (speaks faintly), 00:37:18.420 --> 00:37:21.570 like, how are they, like, valued typically 00:37:21.570 --> 00:37:23.100 if they're valued differently? 00:37:23.099 --> 00:37:24.659 - No, they're always valued at the cost 00:37:24.659 --> 00:37:27.269 to reproduce the worker regardless of what it is. 00:37:27.269 --> 00:37:31.233 This is an another averaging force. 00:37:33.210 --> 00:37:35.039 Right, all labor is the same. 00:37:35.039 --> 00:37:37.980 That's why the proletariat is ultimately uniform 00:37:37.980 --> 00:37:40.260 because they only get... 00:37:40.260 --> 00:37:42.270 Their wages get driven down... 00:37:42.269 --> 00:37:46.170 Wait till you see the mystification of the wage form. 00:37:46.170 --> 00:37:48.000 Their wages get driven down 00:37:48.000 --> 00:37:51.599 to the minimum of their historical means of subsistence 00:37:51.599 --> 00:37:53.282 when at all possible. 00:37:54.420 --> 00:37:57.480 Workers' groups can fight against that and can raise it, 00:37:57.480 --> 00:38:00.230 but it gets taken out in other places, as he will show. 00:38:01.793 --> 00:38:04.769 The capital system eats its limits, including unions. 00:38:04.769 --> 00:38:06.840 So what do you do? 00:38:06.840 --> 00:38:08.400 Form a union? 00:38:08.400 --> 00:38:09.452 Shorten the day? 00:38:10.590 --> 00:38:13.380 You can do that, but as he shows in the 19th century, 00:38:13.380 --> 00:38:17.250 this increased the pressure to raise productivity 00:38:17.250 --> 00:38:19.110 to such a degree that people were just dying 00:38:19.110 --> 00:38:20.103 in a shorter time. 00:38:22.619 --> 00:38:24.029 We don't have to be cynical about it, 00:38:24.030 --> 00:38:27.210 but it is worth showing, understanding how capital, 00:38:27.210 --> 00:38:28.949 the capital system, eats its limits. 00:38:28.949 --> 00:38:32.730 Or if you try to make a reasonable capital system, 00:38:32.730 --> 00:38:34.619 it always backfires. 00:38:34.619 --> 00:38:36.119 This is Marx's view. 00:38:36.119 --> 00:38:39.269 There is no way to make a better capital system. 00:38:39.269 --> 00:38:41.639 It can be better temporarily. 00:38:41.639 --> 00:38:43.469 It can be better for certain groups. 00:38:43.469 --> 00:38:45.359 But it will always recoup 00:38:45.360 --> 00:38:47.220 in one way or the other the misery 00:38:47.219 --> 00:38:48.632 that it imposes on people. 00:38:50.250 --> 00:38:51.690 This is Marx's position. 00:38:51.690 --> 00:38:53.909 It's a structural analytic position. 00:38:53.909 --> 00:38:56.252 It's not a moral position by any means, 00:38:57.119 --> 00:39:00.869 and this is a very strong challenge to current economics 00:39:00.869 --> 00:39:04.589 and liberalism that is worth thinking through, 00:39:04.590 --> 00:39:06.750 whether you end up agreeing with it or not. 00:39:06.750 --> 00:39:11.070 It is relentlessly and resolutely negative, 00:39:11.070 --> 00:39:12.220 the effects of capital. 00:39:13.260 --> 00:39:14.850 Though it feeds the world, 00:39:14.849 --> 00:39:17.849 it drives the majority of people 00:39:17.849 --> 00:39:20.670 into an immiserated circumstance 00:39:20.670 --> 00:39:23.550 such that their lives are kind of keeping pace 00:39:23.550 --> 00:39:24.663 with their own misery. 00:39:27.900 --> 00:39:28.733 AJ. 00:39:32.610 --> 00:39:34.079 Sure, you can for a short time, 00:39:34.079 --> 00:39:36.150 but as Marx says in one of these chapters, 00:39:36.150 --> 00:39:40.079 the quality of their work suffers, (laughs) right? 00:39:40.079 --> 00:39:41.639 You can give them less than they need to eat, 00:39:41.639 --> 00:39:43.619 but they're gonna wear out faster. 00:39:43.619 --> 00:39:46.500 You can see that humans are now a form 00:39:46.500 --> 00:39:49.260 of capital that are invested in, 00:39:49.260 --> 00:39:53.440 and we end today's session talking about 00:39:54.300 --> 00:39:56.130 constant and variable capital. 00:39:56.130 --> 00:39:57.390 What used to be called workers 00:39:57.389 --> 00:39:59.639 are now called variable capital, 00:39:59.639 --> 00:40:02.190 variable because you can get more 00:40:02.190 --> 00:40:05.010 and less surplus value out of them 00:40:05.010 --> 00:40:07.173 depending how you turn the dials. 00:40:09.900 --> 00:40:11.430 Okay, a few more things. 00:40:11.429 --> 00:40:12.902 We only have 10 minutes left. 00:40:15.840 --> 00:40:17.700 We go to chapter five, 00:40:17.699 --> 00:40:20.492 the labor process and the valorization process. 00:40:22.710 --> 00:40:25.559 But do reread if you have a chance the last pages 00:40:25.559 --> 00:40:26.793 of chapter four. 00:40:33.599 --> 00:40:35.670 One irony that comes up in the last pages 00:40:35.670 --> 00:40:36.869 of chapter four, which I love, 00:40:36.869 --> 00:40:40.109 is that in addition to being exploited, 00:40:40.110 --> 00:40:43.740 that is, paid less than the value they actually create, 00:40:43.739 --> 00:40:47.369 the workers have to loan their labor to the employer 00:40:47.369 --> 00:40:49.289 and get paid at the end of the week. 00:40:49.289 --> 00:40:51.119 Isn't that astounding? 00:40:51.119 --> 00:40:54.029 The workers, not only are they exploited, 00:40:54.030 --> 00:40:57.573 but they're the capitalist's first creditor, 00:40:58.769 --> 00:41:01.230 and they have no choice but to lend them to work. 00:41:01.230 --> 00:41:02.909 I always found it astounding. 00:41:02.909 --> 00:41:06.059 Why do I have to wait till the end of the month to get paid? 00:41:06.059 --> 00:41:08.559 Well, because they're extorting the work from you. 00:41:11.579 --> 00:41:13.293 Did I tell you the four Xs? 00:41:14.190 --> 00:41:18.720 Extortion, expropriation, extraction, exploitation. 00:41:18.719 --> 00:41:20.309 This is the relentless negativity 00:41:20.309 --> 00:41:23.670 that this book is giving you, the four Xs. 00:41:23.670 --> 00:41:28.233 Those are the modes by which capital depletes everything. 00:41:33.989 --> 00:41:34.822 Okay. 00:41:36.570 --> 00:41:39.600 We're going into the sphere of production now, 00:41:39.599 --> 00:41:42.449 but we're going in, first of all, 00:41:42.449 --> 00:41:44.489 from the standpoint of the capitalist. 00:41:44.489 --> 00:41:46.469 This is what production looks like 00:41:46.469 --> 00:41:48.722 for the capitalists from their standpoint. 00:41:49.860 --> 00:41:51.480 I'm giving you a lot of formulas today, 00:41:51.480 --> 00:41:54.393 but let's do this one last one. 00:42:03.480 --> 00:42:05.103 This is what it looks like. 00:42:10.829 --> 00:42:14.252 This is where value is created. 00:42:27.809 --> 00:42:31.500 You start with money that's advanced from the capitalist 00:42:31.500 --> 00:42:34.952 to get a commodity that's a raw material. 00:42:36.960 --> 00:42:38.403 It goes into production. 00:42:39.599 --> 00:42:43.409 It gets worked by labor and becomes commodity prime, 00:42:43.409 --> 00:42:44.730 that is, you get a lump of iron, 00:42:44.730 --> 00:42:47.193 and it comes out cast-iron pot, right? 00:42:49.590 --> 00:42:51.150 And that cast-iron pot goes out 00:42:51.150 --> 00:42:54.630 and brings more than the money you invested 00:42:54.630 --> 00:42:58.480 in the means of production, which is 00:43:00.780 --> 00:43:04.200 raw materials and the means of labor, 00:43:04.199 --> 00:43:08.522 tools and equipment and objects, 00:43:13.079 --> 00:43:15.063 and the labor power you've bought. 00:43:17.099 --> 00:43:18.599 You've bought labor power. 00:43:18.599 --> 00:43:20.009 You've bought means of production. 00:43:20.010 --> 00:43:21.150 It goes into production, 00:43:21.150 --> 00:43:23.160 and you get out something more than you got in, right? 00:43:23.159 --> 00:43:24.779 That's what we understand work to be. 00:43:24.780 --> 00:43:26.010 You've worked something, 00:43:26.010 --> 00:43:27.840 and the thing is different, more, 00:43:27.840 --> 00:43:30.450 better suited to something than it was before. 00:43:30.449 --> 00:43:33.539 It's more developed like the lump, 00:43:33.539 --> 00:43:36.483 like iron ore becomes an iron rod. 00:43:37.469 --> 00:43:39.089 You just snap your fingers. 00:43:39.090 --> 00:43:42.597 An iron rod becomes a cast-iron pot (snaps) like that. 00:43:42.597 --> 00:43:43.769 You just snap your fingers. 00:43:43.769 --> 00:43:46.710 No, there's this labor that happens in the meantime. 00:43:46.710 --> 00:43:48.090 So he's adding this in here 00:43:48.090 --> 00:43:51.329 and showing you what hides behind circulation 00:43:51.329 --> 00:43:55.019 is actually the hidden place of production 00:43:55.019 --> 00:43:58.050 in which these factors of production depend 00:43:58.050 --> 00:44:01.083 on this difference in order to produce the more, 00:44:04.559 --> 00:44:06.539 the difference between labor power 00:44:06.539 --> 00:44:08.402 and the actual labor that comes out. 00:44:10.019 --> 00:44:12.300 Okay, before we get to surplus value, 00:44:12.300 --> 00:44:14.222 which I think we'll get to next time, 00:44:17.579 --> 00:44:18.690 and remember, just we're doing 00:44:18.690 --> 00:44:20.943 this weird formula dance today. 00:44:29.820 --> 00:44:32.580 This is what a laborer sees, 00:44:32.579 --> 00:44:35.639 sees their labor power exchanged for money, 00:44:35.639 --> 00:44:37.079 which they use to buy a commodity, 00:44:37.079 --> 00:44:38.880 which is their means of subsistence. 00:44:41.730 --> 00:44:43.659 So this is the standpoint of labor 00:44:44.550 --> 00:44:48.150 and the standpoint of capital, 00:44:48.150 --> 00:44:50.190 if they knew it, 00:44:50.190 --> 00:44:54.003 which they don't, unless they read Marx, 00:44:55.739 --> 00:44:56.589 which they don't. 00:45:00.239 --> 00:45:02.250 Okay, before we go, I want to just say a few things 00:45:02.250 --> 00:45:06.090 about what labor is for Marx, where it comes from, 00:45:06.090 --> 00:45:08.193 how it differs from Ricardo and Smith. 00:45:09.599 --> 00:45:12.929 I'm gonna leave this up here 'cause it looks so good. 00:45:12.929 --> 00:45:15.569 I realize spending a life reading texts like poems 00:45:15.570 --> 00:45:18.420 with people, you don't put anything on the board, really. 00:45:19.590 --> 00:45:20.740 It's not as impressive. 00:45:23.460 --> 00:45:24.932 Okay, what is labor? 00:45:32.070 --> 00:45:34.400 Labor is according to Marx... 00:45:35.340 --> 00:45:36.570 What is labor? 00:45:36.570 --> 00:45:38.070 Do you have a good definition? 00:45:40.980 --> 00:45:42.063 Seminar moment. 00:45:46.380 --> 00:45:47.403 Labor work? 00:45:50.190 --> 00:45:51.023 AJ? 00:45:51.023 --> 00:45:53.880 - The thing done to transform a thing. 00:45:53.880 --> 00:45:55.740 - Thing done to transform one thing to another. 00:45:55.739 --> 00:45:57.329 So if I take a hat, 00:45:57.329 --> 00:46:00.989 and I pull a rabbit out of it, that's labor? 00:46:00.989 --> 00:46:02.369 Well, maybe. 00:46:02.369 --> 00:46:03.989 Could be. 00:46:03.989 --> 00:46:05.339 Yeah. - So maybe add to that 00:46:05.340 --> 00:46:06.269 it's an ability, 00:46:06.269 --> 00:46:10.860 so it's a capacity to make change 00:46:10.860 --> 00:46:12.630 or work on something. 00:46:12.630 --> 00:46:15.750 - It is true Marx is Aristotelian in this way. 00:46:15.750 --> 00:46:19.260 He thinks things go from capacities to actualities. 00:46:19.260 --> 00:46:21.120 So, labor, if you can do it, 00:46:21.119 --> 00:46:22.222 there was a capacity that preceded it. 00:46:22.222 --> 00:46:24.298 This is not the only way to think about things. 00:46:24.298 --> 00:46:25.132 Hazal. 00:46:25.132 --> 00:46:26.670 - There has to be an idea behind it, 00:46:26.670 --> 00:46:29.309 so it's not like the land engages in it. 00:46:29.309 --> 00:46:31.380 - Okay, so nature does not do labor. 00:46:31.380 --> 00:46:33.390 Nature transforms. 00:46:33.389 --> 00:46:36.572 But as he says, quoting Aristotle, 00:46:37.829 --> 00:46:41.009 labor, human labor, has an idea 00:46:41.010 --> 00:46:44.790 and leads that idea as part of the capacity into actuality. 00:46:44.789 --> 00:46:45.623 That's true. 00:46:46.530 --> 00:46:47.363 Yeah. 00:46:47.362 --> 00:46:48.195 - Is it like energy? 00:46:49.530 --> 00:46:51.660 - Labor, that would be a physical definition of it, 00:46:51.659 --> 00:46:54.179 that it's energy that does work 00:46:54.179 --> 00:46:56.702 or effort that produces a product, yeah. 00:46:59.623 --> 00:47:01.679 I'm gonna do another formula. 00:47:01.679 --> 00:47:02.639 This is good. 00:47:02.639 --> 00:47:03.940 Ooh, I can pull this down? 00:47:05.099 --> 00:47:05.932 Is that true? 00:47:07.289 --> 00:47:08.130 Yeah, look at that. (object whirring) 00:47:08.130 --> 00:47:08.963 Ah. 00:47:11.969 --> 00:47:14.822 Labor has a very particular intentional structure. 00:47:16.829 --> 00:47:18.273 It's gonna sound insane. 00:47:20.969 --> 00:47:21.802 - Wow. 00:47:26.396 --> 00:47:27.480 - How's that? 00:47:28.650 --> 00:47:31.230 This is the intentional structure of labor. 00:47:31.230 --> 00:47:34.143 A worker works a workable into a worked. 00:47:35.099 --> 00:47:36.752 It has a temporal structure too. 00:47:40.050 --> 00:47:41.730 This is the subjective element, 00:47:41.730 --> 00:47:43.579 what he calls the subjective element. 00:47:45.000 --> 00:47:48.719 This is the objective element. 00:47:48.719 --> 00:47:50.222 And this is a process. 00:47:54.179 --> 00:47:56.012 These two belong to nature. 00:47:59.849 --> 00:48:02.559 The process of work belongs to human nature 00:48:04.199 --> 00:48:05.909 according to Marx. 00:48:05.909 --> 00:48:07.649 I'm not sure I agree with this, 00:48:07.650 --> 00:48:10.829 but it certainly has a non-natural element, 00:48:10.829 --> 00:48:15.512 which is that the way of working changes socially. 00:48:17.190 --> 00:48:20.849 But fundamentally, working is a natural, 00:48:20.849 --> 00:48:23.699 as is the workable object, 00:48:23.699 --> 00:48:24.752 comes from nature. 00:48:25.679 --> 00:48:28.269 And the process here he likens to 00:48:31.110 --> 00:48:33.059 another natural. 00:48:33.059 --> 00:48:36.179 He likens to it, it's a little different, 00:48:36.179 --> 00:48:39.119 where at least, in work in socialism 00:48:39.119 --> 00:48:42.179 or pre-capitalist formations, 00:48:42.179 --> 00:48:43.710 work is like a metabolism. 00:48:43.710 --> 00:48:47.130 It takes a workable, and it digests it 00:48:47.130 --> 00:48:49.083 and spits it out as a worked, 00:48:50.309 --> 00:48:52.619 or as as a work, if you want to put it that way. 00:48:52.619 --> 00:48:53.452 Yeah. 00:48:53.452 --> 00:48:56.130 - Do capitalists do labor or do work? 00:48:56.130 --> 00:48:57.750 - No. 00:48:57.750 --> 00:48:59.373 Nope, capitalists never work, 00:49:00.630 --> 00:49:03.210 not because they're sitting around either. 00:49:03.210 --> 00:49:04.653 Capitalists are, 00:49:05.940 --> 00:49:07.710 what do you call them? 00:49:07.710 --> 00:49:09.360 What do they call them here? Stewards. 00:49:09.360 --> 00:49:11.309 It's a terrible institutional name. 00:49:11.309 --> 00:49:12.509 They're stewards of work 00:49:12.510 --> 00:49:14.910 or overseers of work, organizers of work, 00:49:14.909 --> 00:49:16.799 but always other people's work. 00:49:16.800 --> 00:49:19.350 So work is not equivalent to effort. 00:49:19.349 --> 00:49:21.549 You make a lot of efforts that are not work. 00:49:22.800 --> 00:49:25.293 Richard. - So it's not really labor. 00:49:25.293 --> 00:49:27.180 It's laboring. 00:49:27.179 --> 00:49:28.172 - Yeah, laboring. 00:49:29.159 --> 00:49:30.182 It's a process. 00:49:33.539 --> 00:49:35.550 This changes somewhat. 00:49:35.550 --> 00:49:39.090 This is the basis for labor under capitalism, 00:49:39.090 --> 00:49:40.980 but it changes somewhat, 00:49:40.980 --> 00:49:43.079 and we'll talk about that next time 00:49:43.079 --> 00:49:44.849 when we get into surplus value, 00:49:44.849 --> 00:49:46.230 the different modes of capital. 00:49:46.230 --> 00:49:48.030 Just warning you that for next week, 00:49:48.030 --> 00:49:49.890 we're talking about the working-day chapter, 00:49:49.889 --> 00:49:51.779 which is about 100 pages. 00:49:51.780 --> 00:49:54.330 It's not theoretical exactly. 00:49:54.329 --> 00:49:55.469 It's historical, 00:49:55.469 --> 00:49:57.932 but might want to get started on your reading. 00:49:59.713 --> 00:50:01.411 (electronic signal humming) 00:50:01.411 --> 00:50:05.996 (electronic device buzzing) (bright music)