Foundations of the Critique of Political Economy (Rough Draft)

Karl Marx

Marx in 1861

Written: 1857–61;
Published: in German 1939–41;
Source: Grundrisse, Penguin Books in association with New Left Review, 1973;
Translated by: Martin Nicolaus;
Notes by: Ben Fowkes;
Scanned by: Tim Delaney, 1997;
HTML Mark-up: Andy Blunden, 2002; Dave Allinson, 2015.

This translation is licensed by the copyright owner, Martin Nicolaus, exclusively to MIA. Publication on other online sites is prohibited. Editorial notes are included by permission of Ben Fowkes.

Grundrisse in eBook formats: epub mobi pdf

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Note on the Text

Marx wrote this huge manuscript as part of his preparation for what would become A Contribution to the Critique of Political Economy (published in 1859) and Capital (published 1867).

Soviet Marxologists released several never-before-seen Marx/Engels works in the 1930s. Most were early works – like the Economic and Philosophical Manuscripts – but the Grundrisse stood alone as issuing forth from the most intense period of Marx’s decade-long, in-depth study of economics. It is an extremely rich and thought-provoking work, showing signs of humanism and the influence of Hegelian dialectic method. Do note, though, Marx did not intend it for publication as is, so it can be stylistically very rough in places.

The series of seven notebooks were rough-drafted by Marx, chiefly for purposes of self-clarification, during the winter of 1857-8. The manuscript became lost in circumstances still unknown and was first effectively published, in the German original, in 1953. A limited edition was published by Foreign Language Publishers in Moscow in two volumes, 1939 and 1941 respectively, under the editorship of the Marx-Engels-Lenin Institute, Moscow. The first volume contained the introduction and the seven notebooks translated here. The second added fragments from Marx’s 1851 notebooks of excerpts from Ricardo, the fragment ‘Bastiat and Carey’ (also included in this translation), and miscellaneous related material; also extensive annotations and sources. A photo-offset reprint of the two volumes bound in one, minus illustrations and facsimiles, was issued by Dietz Verlag, Berlin (E.), in 1953, and is the basis of the present translation. It is referred to hereafter as Grundrisse. Rosdolsky states that only three or four copies of the 1939-41 edition ever reached ‘the western world’.

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Analytical Contents List

INTRODUCTION (Notebook M) p81
(1) Production in general p81
(2) General relation between production, distribution, exchange and consumption p88
(3) The method of political economy p100
(4) Means (forces) of production and relations of production, relations of production and relations of circulation p109
THE CHAPTER ON MONEY (Notebooks I and II, pp. 1–7) p113-238
Darimon’s theory of crises p115
Gold export and crises p125
Convertibility and note circulation p130
Value and price p136
Transformation of the commodity into exchange value; money p140
Contradictions in the money relation p147
(1) Contradiction between commodity as product and commodity as exchange value p147
(2) Contradiction between purchase and sale p148
(3) Contradiction between exchange for the sake of exchange and exchange for the sake of commodities p148
(Aphorisms) p149
(4) Contradiction between money as particular commodity and money as general commodity p150
(The Economist and the Morning Star on money) p151
Attempts to overcome the contradictions by the issue of time-chits p153
Exchange value as mediation of private interests p156
Exchange value (money) as social bond p156
Social relations which create an undeveloped system of exchange p163
The product becomes a commodity; the commodity becomes exchange value; the exchange value of the commodity becomes money p165
Money as measure p166
Money as objectification of general labour time p168
(Incidental remark on gold and silver) p169
Distinction between particular labour time and general labour time p171
Distinction between planned distribution of labour time and measurement of exchange values by labour time p172
(Strabo on money among the Albanians) p172
The precious metals as subjects of the money relation p173
(a) Gold and silver in relation to the other metals p174
(b) Fluctuations in the value-relations between the different metals p180
(c) and (d) (headings only): Sources of gold and silver; money as coin p185
Circulation of money and opposite circulation of commodities p186
General concept of circulation p187
(a) Circulation circulates exchange values in the form of prices p187
(Distinction between real money and accounting money) p190
(b) Money as the medium of exchange p193
(What determines the quantity of money required for circulation) p194
(Comment on (a)) p195
Commodity circulation requires appropriation through alienation p196
Circulation as an endlessly repeated process p197
The price as external to and independent of the commodity p198
Creation of general medium of exchange p199
Exchange as a special business p200
Double motion of circulation: C–M; M–C, and M–C; C–M p201
Three contradictory functions of money p203
(1) Money as general material of contracts, as measuring unit of exchange values p203
(2) Money as medium of exchange and realizer of prices p208
(Money, as representative of price, allows commodities to be exchanged at equivalent prices) p211
(An example of confusion between the contradictory functions of money) p213
(Money as particular commodity and money as general commodity) p213
(3) Money as money: as material representative of wealth (accumulation of money) p215
(Dissolution of ancient communities through money) p223
(Money, unlike coin, has a universal character) p226
(Money in its third function is the negation (negative unity) of its character as medium of circulation and measure) p228
(Money in its metallic being; accumulation of gold and silver) p229
(Headings on money, to be elaborated later) p237
THE CHAPTER ON CAPITAL (Notebooks II pp. 8–28, III–VII) p239-250
The Chapter on Money as Capital p239
Difficulty in grasping money in its fully developed character as money p239
Simple exchange: relations between the exchangers p240
(Critique of socialists and harmonizers: Bastiat, Proudhon) p247
Nothing is expressed when capital is characterized merely as a sum of values p251
Landed property and capital p252
Capital comes from circulation; its content is exchange value; merchant capital, money capital, and money interest p253
Circulation presupposes another process; motion between presupposed extremes p254
Transition from circulation to capitalist production p256
Capital is accumulated labour (etc.) p257
‘Capital is a sum of values used for the production of values’ p258
Circulation, and exchange value deriving from circulation, the presupposition of capital p259
Exchange value emerging from circulation, a presupposition of circulation, preserving and multiplying itself in it by means of labour p262
Product and capital. Value and capital. Proudhon p264
Capital and labour. Exchange value and use value for exchange value p266
Money and its use value (labour) in this relation capital. Self-multiplication of value is its only movement p269
Capital, as regards substance, objectified labour. Its antithesis living, productive labour p271
Productive labour and labour as performance of a service p272
Productive and unproductive labour. A. Smith etc. p273
The two different processes in the exchange of capital with labour p274
Capital and modern landed property p275
The market p279
Exchange between capital and labour. Piecework wages p281
Value of labour power p282
Share of the wage labourer in general wealth determined only quantitatively p283
Money is the worker’s equivalent; he thus confronts capital as an equal p284
But the aim of his exchange is satisfaction of his need. Money for him is only medium of circulation p284
Savings, self-denial as means of the worker’s enrichment p284
Valuelessness and devaluation of the worker a condition of capital p289
(Labour power as capital!) p293
Wages not productive p294
The exchange between capital and labour belongs within simple circulation, does not enrich the worker p295
Separation of labour and property the precondition of this exchange p295
Labour as object absolute poverty, labour as subject general possibility of wealth p296
Labour without particular specificity confronts capital p296
Labour process absorbed into capital p297
(Capital and capitalist) p303
Production process as content of capital p304
The worker relates to his labour as exchange value, the capitalist as use value p306
The worker divests himself of labour as the wealth-producing power; capital appropriates it as such p307
Transformation of labour into capital p308
Realization process p310
(Costs of production) p315
Mere self-preservation, non-multiplication of value contradicts the essence of capital p316
Capital enters the cost of production as capital. Interest-bearing capital p318
(Parentheses on: original accumulation of capital, historic presuppositions of capital, production in general) p319
Surplus value. Surplus labour time p321
Value of labour. How it is determined p322
Conditions for the self-realization of capital p324
Capital is productive as creator of surplus labour p325
But this is only a historical and transitory phenomenon p325
Theories of surplus value (Ricardo; the Physiocrats; Adam Smith; Ricardo again) p326
Surplus value and productive force. Relation when these increase p333
Result: in proportion as necessary labour is already diminished, the realization of capital becomes more difficult p340
Concerning increases in the value of capital p341
Labour does not reproduce the value of material and instrument, but rather preserves it by relating to them in the labour process as to their objective conditions p354
Absolute surplus labour time. Relative p359
It is not the quantity of living labour, but rather its quality as labour which preserves the labour time already contained in the material p359
The change of form and substance in the direct production process p360
It is inherent in the simple production process that the previous stage of production is preserved through the subsequent one p361
Preservation of the old use value by new labour p362
The quantity of objectified labour is preserved because contact with living labour preserves its quality as use value for new labour p363
In the real production process, the separation of labour from its objective moments of existence is suspended. But in this process labour is already incorporated in capital p364
The capitalist obtains surplus labour free of charge together with the maintenance of the value of material and instrument p365
Through the appropriation of present labour, capital already possesses a claim to the appropriation of future labour p367
Confusion of profit and surplus value. Carey’s erroneous calculation p373
The capitalist, who does not pay the worker for the preservation of the old value, then demands remuneration for giving the worker permission to preserve the old capital p374
Surplus Value and Profit p376
Difference between consumption of the instrument and of wages. The former consumed in the production process, the latter outside it p378
Increase of surplus value and decrease in rate of profit p381
Multiplication of simultaneous working days p386
Machinery p389
Growth of the constant part of capital in relation to the variable part spent on wages = growth of the productivity of labour p389
Proportion in which capital has to increase in order to employ the same number of workers if productivity rises p390
Percentage of total capital can express very different relations p395
Capital (like property in general) rests on the productivity of labour p397
Increase of surplus labour time. Increase of simultaneous working days. (Population) p398
(Population can increase in proportion as necessary labour time becomes smaller) p400
Transition from the process of the production of capital into the process of circulation p401
Devaluation of capital itself owing to increase of productive forces p402
(Competition) p413
Capital as unity and contradiction of the production process and the realization process p414
Capital as limit to production. Overproduction p415
Demand by the workers themselves p419
Barriers to capitalist production p422
Overproduction; Proudhon p423
Price of the commodity and labour time p424
The capitalist does not sell too dear; but still above what the thing costs him p430
Price can fall below value without damage to capital p432
Number and unit (measure) important in the multiplication of prices p432
Specific accumulation of capital. (Transformation of surplus labour into capital) p433
The determination of value and of prices p433
The general rate of profit p434
The capitalist merely sells at his own cost of production, then it is a transfer to another capitalist. The worker gains almost nothing thereby p436
Barrier of capitalist production. Relation of surplus labour to necessary labour. Proportion of the surplus consumed by capital to that transformed into capital p443
Devaluation during crises p446
Capital coming out of the production process becomes money again p447
(Parenthesis on capital in general) p449
Surplus Labour or Surplus Value Becomes Surplus Capital p450-459
All the determinants of capitalist production now appear as the result of (wage) labour itself p450
The realization process of labour at the same time its de-realization process p452
Formation of surplus capital I p456
Surplus capital II p456
Inversion of the law of appropriation p458
Chief result of the production and realization process p458
Original Accumulation of Capital p459
Once developed historically, capital itself creates the conditions of its existence p459
(Performance of personal services, as opposed to wage labour) p465
(Parenthesis on inversion of the law of property, real alien relation of the worker to his product, division of labour, machinery) p469
Forms which precede capitalist production. (Concerning the process which precedes the formation of the capital relation or of original accumulation) p471
Exchange of labour for labour rests on the worker’s propertylessness p514
Circulation of capital and circulation of money p516
Production process and circulation process moments of production. The productivity of the different capitals (branches of industry) determines that of the individual capital p517
Circulation period. Velocity of circulation substitutes for volume of capital. Mutual dependence of capitals in the velocity of their circulation p518
The four moments in the turnover of capital p520
Moment II to be considered here: transformation of the product into money; duration of this operation p521
Transport costs p521
Circulation costs p524
Means of communication and transport p525
Division of the branches of labour p527
Concentration of many workers; productive force of this concentration p528
General as distinct from particular conditions of production p533
Transport to market (spatial condition of circulation) belongs in the production process p533
Credit, the temporal moment of circulation p534
Capital is circulating capital p536
Influence of circulation on the determination of value; circulation time = time of devaluation p537
Difference between the capitalist mode of production and all earlier ones (universality, propagandistic nature) p540
(Capital itself is the contradiction) p543
Circulation and creation of value p544
Capital not a source of value-creation p547
Continuity of production presupposes suspension of circulation time p548
Theories of Surplus Value p549-602
Ramsay’s view that capital is its own source of profit p549
No surplus value according to Ricardo’s law p551
Ricardo’s theory of value. Wages and profit p553
Quincey p557
Ricardo p559
Wakefield. Conditions of capitalist production in colonies p563
Surplus value and profit. Example (Malthus) p564
Difference between labour and labour capacity p576
Carey’s theory of the cheapening of capital for the worker p579
Carey’s theory of the decline of the rate of profit p580
Wakefield on the contradiction between Ricardo’s theories of wage labour and of value p581
Bailey on dormant capital and increase of production without previous increase of capital p582
Wade’s explanation of capital. Capital, collective force. Capital, civilization p584
Rossi. What is capital? Is raw material capital? Are wages necessary for it? p591
Malthus. Theory of value and of wages p595
Aim of capitalist production value (money), not commodity, use value etc. Chalmers p600
Difference in return. Interruption of the production process. Total duration of the production process. Unequal periods of production p602
The concept of the free labourer contains the pauper. Population and overpopulation p604
Necessary labour. Surplus labour. Surplus population. Surplus capital p608
Adam Smith: work as sacrifice p610
Adam Smith: the origin of profit p614
Surplus labour. Profit. Wages p616
Immovable capital. Return of capital. Fixed capital. John Stuart Mill p616
Turnover of capital. Circulation process. Production process p618
Circulation costs. Circulation time p633
Capital’s change of form and of substance; different forms of capital; circulating capital as general character of capital p637
Fixed (tied down) capital and circulating capital p640
Constant and variable capital p649
Competition p649
Surplus value. Production time. Circulation time. Turnover time p650
Competition (continued) p657
Part of capital in production time, part in circulation time p658
Surplus value and production phase. Number of reproductions of capital = number of turnovers p663
Change of form and of matter in the circulation of capital C–M–C. M–C–M p667
Difference between production time and labour time p668
Formation of a mercantile estate; credit p671
Small-scale circulation. The process of exchange between capital and labour capacity generally p673
Threefold character, or mode, of circulation p678
Fixed capital and circulating capital p679
Influence of fixed capital on the total turnover time of capital p684
Fixed capital. Means of labour. Machine p690
Transposition of powers of labour into powers of capital both in fixed and in circulating capital p699
To what extent fixed capital (machine) creates value p701
Fixed capital & continuity of the production process. Machinery & living labour p702
Contradiction between the foundation of bourgeois production (value as measure) and its development p704
Significance of the development of fixed capital (for the development of capital generally) p707
The chief role of capital is to create disposable time; contradictory form of this in capital p708
Durability of fixed capital p710
Real saving (economy) = saving of labour time = development of productive force p711
True conception of the process of social production p712
Owen’s historical conception of industrial (capitalist) production p712
Capital and value of natural agencies p714
Scope of fixed capital indicates the level of capitalist production p715
Is money fixed capital or circulating capital? p716
Turnover time of capital consisting of fixed capital and circulating capital. Reproduction time of fixed capital p717
The same commodity sometimes circulating capital, sometimes fixed capital p723
Every moment which is a presupposition of production is at the same time its result, in that it reproduces its own conditions p726
The counter-value of circulating capital must be produced within the year. Not so for fixed capital. It engages the production of subsequent years p727
Maintenance costs of fixed capital p732
Revenue of fixed capital and circulating capital p732
Free labour = latent pauperism. Eden p735
The smaller the value of fixed capital in relation to its product, the more useful p737
Movable and immovable, fixed and circulating p739
Connection of circulation and reproduction p741
Rate of profit. Fall of the rate of profit p745
Surplus value as profit always expresses a lesser proportion p753
Wakefield, Carey and Bastiat on the rate of profit p754
Capital and revenue (profit). Production and distribution. Sismondi p758
Transformation of surplus value into profit p762
Laws of this transformation p762
Surplus value = relation of surplus labour to necessary labour p764
Value of fixed capital and its productive power p765
Machinery and surplus labour. Recapitulation of the doctrine of surplus value generally p767
Relation between the objective conditions of production. Change in the proportion of the component parts of capital p771
Money and fixed capital: presupposes a certain amount of wealth. Relation of fixed capital and circulating capital. (Economist) p778
Slavery and wage labour; profit upon alienation (Steuart) p778
Steuart, Montanari and Gouge on money p781
The wool industry in England since Elizabeth; silk-manufacture; iron; cotton p783
Origin of free wage labour. Vagabondage. (Tuckett) p785
Blake on accumulation and rate of profit; dormant capital p786
Domestic agriculture at the beginning of the sixteenth century. (Tuckett) p788
Profit. Interest. Influence of machinery on the wage fund. (Westminster Review) p789
Money as measure of values and yardstick of prices. Critique of theories of the standard measure of money p789
Transformation of the medium of circulation into money. Formation of treasures. Means of payment. Prices of commodities and quantity of circulating money. Value of money p805
Capital, not labour, determines the value of money. (Torrens) p816
The minimum of wages p817
Cotton machinery and working men in 1826. (Hodgskin) p818
How the machine creates raw material. (Economist) p818
Machinery and surplus labour p819
Capital and profit. Relation of the worker to the conditions of labour in capitalist production. All parts of capital bring a profit p821
Tendency of the machine to prolong labour p825
Cotton factories in England. Example for machinery and surplus labour p826
Examples from Glasgow for the rate of profit p828
Alienation of the conditions of labour with the development of capital. Inversion p831
Merivale. Natural dependence of the worker in colonies to be replaced by artificial restrictions p833
How the machine saves material. Bread. D’eau de la Malle p834
Development of money and interest p836
Productive consumption. Newman. Transformations of capital. Economic cycle p840
Dr Price. Innate power of capital p842
Proudhon. Capital and simple exchange. Surplus p843
Necessity of the worker’s propertylessness p845
Galiani p846
Theory of savings. Storch p848
MacCulloch. Surplus. Profit p849
Arnd. Natural interest p850
Interest and profit. Carey p851
How merchant takes the place of master p855
Merchant wealth p856
Commerce with equivalents impossible. Opdyke p861
Principal and interest p862
Double standard p862
On money p864
James Mill’s false theory of prices p867
Ricardo on currency p870
On money p871
Theory of foreign trade. Two nations may exchange according to the law of profit in such a way that both gain, but one is always defrauded p872
Money in its third role, as money p872
(I) VALUE (This section to be brought forward) p881
Bastiat’s economic harmonies p883
Bastiat on wages p889