Chapter 8: Constant and Variable Capital

Submitted by libcom on August 10, 2005

Outline of Marx's Discussion

Constant Capital is the value invested in the means of production (MP) and thus embodied in them. Therefore, when Marx speaks of constant capital, he sometimes refers to the MP itself and sometimes to the value invested.

Variable Capital is the value invested in the hiring of labor power (LP) and embodied in the means of subsistence necessary for its reproduction. Therefore, when Marx speaks of variable capital, he sometimes speaks of the LP itself and sometimes of the value invested.

Labor: preserves old value, creates new value

Labor: "creates" value by virtue of its character as abstract labor
Labor: "preserves" value by virtue of its character as useful labor, i.e., because it has the specific character necessary to use the means of production and raw material and to transform them

Without the general character of abstract labor, there would be no value created.
Without the specific skill the product would not emerge or would emerge scarred or
unsellable "”i.e., with no, or less value.

LABOR, through working, creates new value, if more than the value of its labor power, then it creates surplus value. The more work, the more value. So the value transfer is variable.

The MEANS OF PRODUCTION transfer their value to the product as their use-value is expended. (Assuming they are themselves the product of labor and thus embody value.) This may be done quickly (raw materials that are consumed completely) or over a prolonged period of time (machines that are depreciated). It may include waste. But, "their value undergoes a metempsychosis. It deserts the consumed body to occupy the newly created one." So the value transfer is constant.

Secondary points:

1) Marx treats the repairs of machines, i.e., the value imparted to them during repairs, the same as their original creation. The repair labor is added to the original labor to determine their value. So depreciation in the text is that "which no doctor can cure."

2) Although the value transferred to the product = c + v + s, if for some reason the SNLT required for producing MP or LP should rise or fall, then the value of c + v in the product will rise or fall and s will diminish or increase accordingly.

This is one chapter where Marx's use of language can be particularly confusing. When he speaks of labor "preserving" or "creating" value, he makes value sound like some peculiar essence, some ethereal substance which can be conjured into being, conserved or transferred from one object to another. This is particularly true with his reference to value undergoing a "metempsychosis" which usually refers to the transmigration of souls from one body to another. Several of these verbs: preserve, create, transfer, are all transitive verbs which seem to have an object: value. Unfortunately, the meaning of value is obscured by this language.
Creating and Transferring Value

When Marx speaks of labor "creating" value, he is speaking simply of working within the context of capitalist institutions. Any labor which fills the prerequisites of capital "creates" value, that is to say it forms the substance of value. Workers "create" value every time they work within this context. To say labor "creates value by virtue of its character as abstract labor" is simply to say that it performs the roles capital assigns to it; it creates commodities which are sold and on which a profit is realized and in the process it serves as the basic means of social control, i.e., of organizing society around capitalist institutions.

When Marx speaks of labor "preserving" value, he refers simply to the way labor, if it is performed competently, guarantees that the labor already embodied in raw materials and means of production actually contributes to the creation of the final product, and therefore counts as part of the labor time required to produce that product.

We can see, therefore, that the language can be interpreted consistently with what we have already said about value before, it is just unfortunate that the language chosen is not clearer.

We should note, that in this chapter as in chapter 7, Marx is developing further aspects of the fundamental dichotomy he set out in chapter 1 between abstract labor and useful labor. Here it is the useful labor, which is to say the actual concrete processes of labor which produce a use-value, which preserves, through its competence the labor already invested in prior stages of production. It is the characteristic of that useful labor as labor as such, as labor within capital which makes it count as additional value.

With respect to Marx's comments on the repair of machinery, the point is a simple one: the labor it takes to create a machine and the labor it takes to keep it running are all necessary for its existence as a machine and must count as value. More interesting for us is the analogy we can draw between the labor that repairs machinery and the labor that repairs labor power. Later on in chapter 23 of Capital Marx has some discussion of this issue but we can at least mention it here.
Repairing and Producing Labor Power

In Marx's discussion in chapter 6 the labor required to reproduce the ability and willingness to work was that involved in creating the value of labor power, that is to say the labor embodied in the means of subsistence. The issue of the labor of repair, however, raises new issues. Partly such labor can be analogous to that already discussed. For example, the labor that produces on the job coffee that keeps workers going is much the same as that which produces the food they buy with their wages. The coffee is clearly part of a non-money wage. But what of the labor of cooking, of caring for the sick, of patching back together the psychological wounds incurred on the job? What, in short, of all the work called housework which contributes to the daily, weekly and annual repair of labor power? This labor does not create commodities purchased with the wage. Nor does it create commodities which the capitalist purchases and then provides to the worker. (Unless we want to see the family wage as purchasing such services from houseworkers.) Such labor, because it does not produce a capitalist marketed good, is not counted in the value of labor-power. It certainly effects that value, but it is not included in it.

How does it effect the value of labor power? It does so by influencing the value necessary for the reproduction of labor power. One of the reasons why labor power in rural areas of the Third World is so cheap is because a great deal of housework is done on subsistence plots of land. That housework produces subsistence crops and other forms of food as well as household implements and even sometimes clothing. In the cities, where such work cannot be done, wages in general must be higher simply to guarantee the reproduction of the labor force. It would seem that the more of this work is done the less the value of labor power, ceteris paribus.

Even in the developed countries such labor is important. In the early 1970s when food prices jumped as a result of Nixon Administration manipulation of the supply and demand for agricultural goods, there was a rapid expansion in home gardening and canning. This home production constituted an expansion of housework to offset an attack on the real wage (the value of labor power). People wanted to continue to eat as well as they did before prices jumped. Of course, they sometimes forgot that even when they were successful in maintaining their standards of consumption, the increase in the amount of work they were forced to perform meant a drop in that part of their standard of living made up of leisure time.

In general the amount of work involved in patching up, in repairing labor power is probably much greater than that involved in repairing machinery. When you count all the work done by individuals trying to take care of themselves and all the work done by spouses and even kids, you have a tremendous amount of work "”and none of it is taken into account by capitalist accounting methods, e.g., national income accounting which only tallies up the market values of sold commodities. Only when workers are forced to have such work done by professionals: cooks, housekeepers, cleaning establishments, prostitutes, psychotherapists, and so on, does such work produce a marketed service which is counted as part of the value of labor power.

In one area this has become a public point of contention. In recent divorce and separation legal cases women have argued persuasively that their work has economic value and should be reimbursed. Some economists have argued that housework should have a value imputed to it and should be included in measures of Gross National Product. There has even been an international "wages for housework" campaign of women demanding regular payment for their work "”by business, of course, through the state. To the degree that such payments become commonplace, such housework comes to be counted directly in the value of labor power.

All of this concerns a situation in which capital has more or less successfully extended its control into the community. But, of course, at the same time it creates a new terrain of struggle and one on which the working class has won some victories in recent years.
Recommended Further Reading

On the logic of the "wages for housework" analysis of the work of women in the home and their demands for payment for their work see the seminal work by Mariarosa Dalla Costa and Selma James, The Power of Women and the Subversion of the Community, Bristol: Falling Wall Press, 1972.
Concepts For Review
creation of value
preservation of value
Questions For Review
(An * means that one possible answer to the question can be found at the end of the study guide.)

*1. What do you think Marx means by the "creation" or "preservation" of value? If you disagree with the interpretation I have set forward, explain your reasons.

2. Define and distinguish constant and variable capital. In what sense is there a conflict between the two?

3. Why might workers want more constant capital as opposed to less?

*4. Discuss the analogy I have suggested between the work of repairing constant capital and that of repairing variable capital. What do you think of the way Marx ignores housework in his calculation of the value of labor power?

5. What is there about subsistence peasants that makes it cheap for capitalists to hire them?

*6. What would be the counterparts of constant and variable capital in the "industry" of creating and repairing labor power?