Chapter 3 Week 2
Chapter 3 of Capital is not the most enthralling text ever written, but in the notes from this week we will see the points of culmination. So far we have discussed money and the role of money both in the exchange of commodities and in the construction of an object as a commodity. As a universal equivalent that is in itself positioned as an object of the future, we spend money later, and as a structure of social functionality, we can see how capital starts to orient the possibilities of action around some market mediated understanding of future moments. This displacement into the future comes to then shape the conditions of possibility for the present around this displacement of value into a dynamic of commodities in circulation.
For the remainder of this chapter we will continue this discussion of futurity, and get into some of the more technical elements of how futurity functions, the ways this comes to impact commodity forms and circulation and, ultimately, what the social and ontological impacts of that displacement are. I am going to keep the introduction to the material for this week minimal, to allow for the content to stand on its own.
Away we go...
- Marx begins this thread of discussion with the concept of commodity circulation operating as a circuit. In this discussion the core element is not so much the metaphor of the circuit, or even the metaphor of metabolism, but is the way that this repositions the temporality of the act. Within the process of circulation each act is displaced from its own present, and inserted into a hypothetical future, which in turn operates as a condition of possibility for the present. We can see this in a simplistic example. The act of production is premised on the exchange of the commodity for money, which is then accepted based on the assumption of its future social relevance (others accept this money as an equivalent for commodities in a future moment).
In this simple example of generic commodity production the act is displaced from itself and inserted into some outside moment which has yet to occur. This moment is not just confined to the specific anticipated exchange. Rather, it is the projection of a whole structure of social circulation and existential possibility. We will discuss the concept of circulation as point of intervention later, but for now suffice to say that this circulation is one which tends toward totality. The more people accept currency as money, and the more “stable” the political conditions are the more that these conditions facilitate commodity circulation. As such, capital only functions to the degree that all present moments are defined through the construction of the social structure of the future.
Clearly this is impossible, one cannot predict a moment that has not occurred unless we posit an existentially nullifying deterministic universe (which essentially means that all of these questions, including all of politics and the entire anarchist project are just events that were determined to occur by some controlling entity). So, if actions create contingent effects in their collision with other dynamics, and the aggregate of these effects constructs future moments, then the only way to attempt to construct the future is to limit the possibilities of the present. We have a name for the institution built to impose sovereignty as a limitation on possibility, we call them the police. It is in this sociality and futurity that we see the necessity of policing for commodity circulation to occur, and thus the necessity of the state for capitalism to function.
- In this process of alienation from the present there is a dual displacement at work. Firstly, the commodity is displaced from the present in its mere existence as a commodity, or as an object produced for exchange only. In its existence as a commodity the condition of possibility for the object is not the object, or even the material use of the object. Rather, the object only exists as a carrier of abstract value, it is completely alienated from its materiality.
When sold the object is transferred both between owners but also between structures of value. For the seller the commodity is only relevant to the degree that it carries abstract exchange value; its material form or manifestation, whether pencils or ammunition, is irrelevant. For the buyer, however, the object fundamentally changes ontological shape, morphing from this object in which materiality has been completely alienated to an object which, again, is able to hold use-value; namely, the person that buys something uses it, and returns the object to its materiality. For the seller the commodity sheds its material guise, and carries forward in the form of pure quantifiable value, or money. This separation of abstract exchange value from the materiality of the commodity becomes really critical later when we discuss savings and hoarding.
The second displacement occurs here. Money, which is the form that value takes when decoupled from the material elements of the commodity (which are relevant to the degree that they carry value through a material object, in which the shape of the object is irrelevant), only matters to the degree that a second future is posited, the future of purchase. For money to function it is not enough for it to function for two people in an exchange in the present. For a seller to accept money they have to predict that some anonymous other in some unknown future moment will accept this as money. This is important, in that the other never needs to be specified, but needs to apply to all possible others, and the unknown future does not need a date, it must apply in all possible futures.
“The two opposite changes undergone by the same commodity are reflected in the displacement, twice repeated but in opposite directions, of the same piece of coin...The frequently repeated displacement of the same coins reflects not only the series of metamorphoses undergone by a single commodity, but also the mutual entanglement of the innumerable metamorphoses in the whole world of commodities” (212).
The commodity comes to exist both as an object with material particularity, for the buyer, as well as a structuring of value and the transportation of value that renders the material shape of the object irrelevant. The ability to nullify the material shape of the commodity in circulation is a product of the way that exchange value functions to render all things equivalent, as a magnitude of quantifiable exchange value. This reductionism, however, only exists in relation to the social logistics of circulation itself, and not just production, which, is itself just a product of circulation as well.
Circulation is where the dynamics of the market come into play, it is a calculus grounded in futurity and, in itself, necessitates this equivalence. So, therefore, we can say that it is circulation, and not production, that actually lives at the heart of the logistics of capitalism; without circulation, of which production is a part, capitalism would cease to function. A similar argument was made in 20 Theses on the Subversion of the Metropolis, which made the argument that the most effective points of intervention were within the logistics chains of capital themselves.
- Money functions to the degree that the use of a specific commodity is standardized as a medium of representational value. In other words, money exists both as the marker of abstract value, and is a commodity in itself; in Marx's context he is using gold here, but today we can speak of paper and coin metals. This constructs the object of money along the lines of three distinct existential structures; the commodity, the mechanism of abstract value circulation ans as material object with use value. It is this structure that allows us to think of money as something that is able to be separated from circulation.
In the initial incursions into this area Marx discusses money through the lens of spending, leading to the impression of a smooth transition from sale to purchase, with all money staying in circulation. But, if this is the case then something like a bank becomes impossible. To the degree that we can separate money into a mechanism for conveying value, separate from its material commodity form or its use-value as a mechanism of circulation, we can begin to speak of the movements of value, and the storing of value for use in the future. In this existence as a mechanism of circulation money functions as coin, but when it is immobilized, removed from circulation, either through savings or interruptions in circulation, it only functions as abstract money devoid of a physical form.
“The continuous circular movement of the two antithetical metamorphoses of commodities, or the repeated alternating flow of sale and purchase, is reflected in the unceasing turnover of money, in the function it performs of a perpetuum mobile of circulation. But as soon as the series of metamorphoses is interrupted, as soon as sales are not supplemented by subsequent purchases, money is immobilized. In other words, it is transformed, as Boisguillebert says, from 'meuble' to 'immeuble', from coin into money” (227).
So, here we can see that money, as store of value, need not take the form of coin, or money in circulation. Rather, it is able to store value, as a conceptual quantity, separate from its utility in purchasing. It is this potential of to store immobile money that shifts the calculation. Money changes role from mechanism of circulation to an end in itself.
“When the circulation of commodities first develops, there also develops the necessity and the passionate desire to hold fast to the product of the first metamorphosis. The product is the transformed shape of the commodity, or its gold chrysalis. Commodities are thus sold not in order to buy commodities, but in order to replace their commodity-form by their money-form. Instead of being merely a way of mediating the metabolic process, this change of form becomes an end in itself. The form of the commodity in which it is divested of content is prevented from functioning as its absolutely alienable form, or even as its transient money-form. The money is petrified into a hoard, and the seller of the commodity becomes a hoarder of money” (227-228).
To the degree that money functions socially everything becomes represented in a commodity form, giving the one who accumulates money “social power”. In other words, if all action, and therefore all possibility, falls within the commodity circulation process, as it necessarily must, then the accumulation of money allows for the purchasing of greater quantities of possibility, but a very limited form of possibility. Capitalism, unlike state run economies, prioritizes movement and a certain form of experimentation. Capitalists use this to claim that this means that capitalism is an expression of all life, when in reality it merely means that the categories relevant within capitalism displace life entirely, and reshape it within its image. As such, we can take whatever action we want, to the degree that it is commodified or commodifiable, and the more money we accumulate the greater the possibility of action is. Actions like looting, riots and the burning of police stations necessarily escapes commodification to the degree that these acts wholly live within the realm of the disruption of circulation.
- The drive toward accumulation is grounded in a contradiction in the money-form. On the one hand money is boundless, it can be used as the equivalent for any commodifiable entity. Yet, on the other hand, there always exists a finite quantity of money, meaning that one can never accumulate enough to ever have maximal possibility.Money must always be finite for a relatively simple reason, exchange value is practically based on scarcity, or the imposition of scarcity.
For example, say that there was enough food to feed all the people on the planet, and there is plenty to do this. If that food were available openly then there would not be much of a reason to pay for it; the same applies if there are not police preventing theft. So, food becomes a commodity with exchange value to the degree that there is a scarcity of food. Now, we do actually produce enough food for all humans, so scarcity is not a product of limitation in supply, but is a product of limiting the possibilities of acquisition. This is why stores have loss prevention teams and why starvation can still occur on a planet with an abundance of food.
The same applies for money. During the time of this writing this would have existed within the calculations around commodity based currencies, such as the gold standard. In that space the value of the currency is directly connected to the quantity of gold divided by the amount of currency units exist in total, with each currency unit representing a fraction of this gold supply. In this structure every unit of currency created, either through printing money or the magic of fractional reserve banking and debt creation, adds to the total quantity of currency, lowering its value per unit in relation to gold, and driving up inflation. If an infinite supply were to be created, then it would be essentially worthless, hence people in Italy in the interwar period wallpapering and insulating their homes with money and, in many cases, reverting to a barter economy. The calculations are now based in supply of a currency compared to the demand for that currency in international currency markets, but the same principle applies in its core tenants, even if the actual math has changed.
As such, there is always the possibility of accumulating more money and, therefore, more social power, but this can never lead to a total accumulation, which in itself would lead to the end of commodity circulation. Therefore, though money can be accumulated, and the drive to accumulate is directly tied to power and possibility within capitalism, one can never accumulate all money, and must preserve the money of others in order for the economy to function. This is the core of the continual drive toward accumulation, but also the economic danger of wealth stratification (trickle-down economics is an attempt to disingenuously work around this, but at its core it is just bad, speculative economics theory with no veracity or much support outside of conservative circles in the US and UK).
“This contradiction between the quantitative limitation and the qualitative lack of limitation of money keeps driving the hoarder back to his Sisyphean task: accumulation. He is in the same situation as the world conqueror, who discovers a new boundary with each country he annexes” (131).