Grundrisse: Notebook VI / VII – The Chapter on Capital

##### Surplus value. Production time. Circulation time. Turnover time

<Before we go further with the review of opinions about fixed capital and circulating capital, we return for a moment to something developed earlier.

We assume for the time being that production time and labour time coincide. The case where interruptions take place within the production phase itself, owing to the technological process, will be looked at later.

Suppose the production phase of a capital equal to 60 working days; of which 40 are necessary labour time. Then, according to the law developed earlier, the surplus value, or the value newly posited by capital, i.e. appropriated alien labour time = 60 − 40; = 20. Let us call this surplus value (=20) S; the production phase – or the labour time employed in production – p. In a period of time which we shall call T – e.g. 360 days – the total value can never be greater than the number of production phases contained in, say, 360. The highest coefficient of S – i.e. the maximum of surplus value which capital can create on the given presuppositions – equals the number of times the creation of S is repeated in 360 days. The outer limit of this reproduction – the reproduction of capital, or rather, now, the reproduction of its production process – is determined by the relation of the production period to the total period of time in which the former can be repeated. If the given period = 360 days, and the duration of production = 60 days, then 360/60, or T/p, i.e. 6, is the coefficient indicating how many times p is contained in T, or how often, given its own inherent limits, the reproduction process of the capital can be repeated within 360 days. It goes without saying that the maximum of the creation of S, i.e. the positing of surplus value, is given by the number of processes in which S can be produced, in a given period of time. This relation is expressed by T/p. The quotient of T/p, or q, is the highest coefficient of S in the period of 360 days, in T generally. ST/p or Sq is the maximum of value. If T/p = q, then T = pq; i.e. the entire duration of T would be production time; the production phase, p, would be repeated as often as it is contained in T. The total value created by capital in a certain time would be = to the surplus labour it appropriates in one production phase, multiplied by the number of times this production phase is contained in the given time. Thus in the above example, = 20 × 360/60 = 20 × 6 = 120 days. q, i.e. T/p, would express the number of turnovers of the capital; but since T = pq, therefore p = T/q; i.e. the duration of one production phase would be equal to the total time divided by the number of turnovers. Thus one production phase of capital would be equal to one of its turnovers. Turnover time and production time would be completely identical; the number of turnovers therefore [would be] exclusively determined by the relation of one production phase to the total time.

However, on this assumption, circulation time is posited as = 0. Yet circulation time has a definite magnitude, which can never become = 0. Now assume additionally that there are 30 days for circulation for every 60 days of production time; call this circulation time added to p, c. In this case, one turnover of capital, i.e. the total time it requires before it can repeat the realization process – the positing of surplus value – would be = 30 + 60 = 90 days (= p + c) (1R (turnover) = p + c). One turnover of 90 days can be repeated in 360 days only 360/90 times, i.e. 4 times. The surplus value of 20 could therefore be posited only 4 times; 20 × 4 = 80. In 60 days the capital produces 20 surplus days; but it has to circulate for 30 days; i.e. during these 30 days it can posit no surplus labour, no surplus value. This is the same for it (as regards the result) as if it had posited a surplus value of only 20 in the period of 90 days. While previously the number of turnovers was determined by T/p, it is now determined by T/(p + c) or T/R; the maximum of value was ST/(p + c); (20 × (300/(60 + 30)) = 20 × (360/90) = 20 × 4 = 80). The number of turnovers hence = the total time divided by the sum of production time and circulation time, and the total value = S multiplied by the number of turnovers. But this formulation does not yet suffice for us to express the relations of surplus value, production time and circulation time.

The maximum of value creation contained in the formula ST/p; value creation restricted by circulation, ST/(p + c) (or ST/R); when we subtract the second amount from the first, then

 ST − ST = p p + c
 ST(p + c) − STp = STp + STc − STp = STc p(p +c) p(p + c) p(p + c)

As difference we then obtain STc / p(p + c) or ST/p × c/(p + c); ST/(p + c) or S′, as we may call this value in the second form, S′ = ST/p − (ST/p × c/(p + c)). But before we develop this formula further, there are still others to be introduced.

If we call the quotient of T/(p + c) q′, then q′ expresses the number of times R = (p + c) is contained in T, the number of turnovers. T/(p + c) = q′ ; hence T = pq′ + cq′.  pq′ then expresses the total production time and cq′ the total circulation time.

Let us call total circulation time C (hence cq′ = C). (T(360) = 4 × 60 (240) + 4 × 30 (120).) With our presupposition, q′ = 4, C = cq′ = 4c; 4 being = to the number of turnovers. We saw previously that the maximum of value-creation = ST/p; but in this case T was posited as = to production time. But the real production time is now T − q; as indeed follows from the equation. T = pq′ (total production time) + cq′ (total circulation time, or C ). Hence T − C = cq′. Hence S(T − C) / p the maximum value creation. Because production time not 360 days, but 360 − cq′, i.e. – 4 × 30 [=] 120; hence 20((360 − 120)/60); (20 × 240)/60 = 80.

Now, finally, as regards the formula

S′ = ST/p − (ST/p × c/(c + p)) = (360 × 20)/60 − 20(360/60 × 30/(30 + 60))

= 120 − (120 × 30/90) = 6 × 20 − (6 × 20 × 3/9)

= 20 × 6 − (20 × 6 × 1/3) or

= 120 − (120 × 1/3) = 120 − 40 = 80,

it signifies that value is equal to the maximum of value, i.e. to value determined only by the relation of production time to total time, minus the number which expresses how often the circulation time is contained in this maximum, plus c/(c + p) = c/R; c/R expresses the relation of circulation time to one turnover of capital. If we multiply numerator and denominator by q′ then cq′ / (c + p)q′ = C/T; c/(c + p) = 30/(30 + 60) = 1/3. c/(c + p) or 1/3 expresses the relation of circulation time to total time, for 360/3 = 120. The turnover (c + p) is contained in C, c/(c + p) or 1/3 times (or c/T times), and this number is the maximum itself multiplied by the number of times a turnover is contained in c, in the circulation time added to one turnover, or divided by the number which expresses how often c is contained in c + p or C in T. If c = 0, then S′ would be ST/p and would be at its maximum. S′ becomes smaller in the same degree as C grows, is inversely related to it, for the factor c/(c + p) and ST/p grows to the same degree. The number to be subtracted [from] the maximum value, ST/p × c/(c + p) or ST/p × c/R.

We have, then, the three equations: (1) S′ = ST/(p + c) = ST/R; (2) S′ = S(T − C) / p; (3) S′ = ST/p − (ST/p × c/(c + p)) = S[T/p − (T/p × c/(c + p))].

Hence: S:S′ = ST/p: S(T − C) / p; or S:S′ = T:(T − C). The maximum of value is to the real value as a given period of time is to this period of time minus total circulation time. Or, as well, S:S′ = pq′:(pq′ − q′c), i.e. = p:(p − c).

On (3) S′ = ST/p − (ST/p × c/(c + p)) = S[T/p − (T/p × c/(c + p))] or, since T/p = q,

S′ = S (q − q ⋅ c/(c + p)) = S(q − qc/R). The total surplus value, therefore, = to the surplus value posited in one production phase, whose coefficient is the number of times the production time is contained in the total time minus the number of times the circulation time of one turnover is contained in this latter number.

S(q − qc/R) = Sq(1 − 1c/R) = Sq((R − c)/R) = Sqp/R = ST/(p + c), which is the first equation. Thus equation 3 means … equation 1: the total surplus value equals the surplus value of one production phase multiplied by the total time, divided by turnover time or multiplied by the number of times the sum of production time and circulation time is contained in total time.

Equation 2: The total value equals surplus value multiplied by total time minus the total circulation time, divided by the duration of one production phase.>

##### Competition

(The fundamental law in competition, as distinct from that advanced about value and surplus value, is that it is determined not by the labour contained in it, or by the labour time in which it is produced, but rather by the labour time in which it can be produced, or, the labour time necessary for reproduction. By this means, the individual capital is in reality only placed within the conditions of capital as such, although it seems as if the original law were overturned. Necessary labour time as determined by the movement of capital itself; but only in this way is it posited. This is the fundamental law of competition. Demand, supply, price (production costs) are further specific forms; price as market price; or general price. Then the positing of a general rate of profit. As a consequence of the market price, the capitals then distribute themselves among different branches. Reduction of production costs etc. In short, here all determinants appear in a position which is the inverse of their position in capital in general. There price determined by labour, here labour determined by price etc. etc. The influence of individual capitals on one another has the effect precisely that they must conduct themselves as capital; the seemingly independent influence of the individuals, and their chaotic collisions, are precisely the positing of their general law. Market here obtains yet another significance. The influence of capitals as individuals on each other thus becomes precisely their positing as general beings, and the suspension of the seeming independence and independent survival of the individuals. This suspension takes place even more in credit. And the most extreme form to which the suspension proceeds, which is however at the same time the ultimate positing of capital in the form adequate to it – is joint-stock capital.) (Demand, supply, price, production costs, contradiction of profit and interest, different relations of exchange value and use value, consumption and production.)

##### Surplus value. Production time. Circulation time. Turnover time. Part of capital in production time, part in circulation time. – Circulation time. – Surplus value and production phase. Number of reproductions of capital = number of turnovers. – Total surplus value etc.

We have seen, then, that the surplus value a capital can posit in a given period of time is determined by the number of times the realization process can be repeated, or the capital can be reproduced in a given period of time; and that the number of these reproductions is determined by the relation of the duration of the production phase not to the total period of time, but rather to this total time minus circulation time. Circulation time thus appears as time during which the ability of capital to reproduce itself, and hence to reproduce surplus value, is suspended. Its productivity – i.e. its creation of surplus values – is therefore inversely related to circulation time, and would reach its maximum if the latter declined to 0. Circulation is an inescapable condition for capital, a condition posited by its own nature, since circulation is the passing of capital through the various conceptually determined moments of its necessary metamorphosis – its life process. In so far as it costs time for capital to run through this course, in this time capital cannot increase its value, because it is not-production time, time in which it does not appropriate living labour. Hence this circulation time can never increase the value created by capital, but can only posit not-value-positing time, hence appear as barrier to the increase of value, in the same relation as it stands towards labour time. This circulation time cannot be counted as part of value-creating time, for the latter is labour time which objectifies itself in value, and nothing else. It does not belong to the production costs of value, nor to the production costs of capital; but it is a condition which makes its self-reproduction more difficult. The obstacles which capital encounters in the path of its realization – i.e. its appropriation of living labour – do not, of course, form a moment of its realization, of its value-creation. Hence it is ridiculous to take production costs here in the original sense. Or we have to distinguish production costs as a particular form from the labour time which objectifies itself in value (as we must distinguish profit from surplus value). But even then, circulation time does not belong among capital’s production costs in the same sense as wages etc.; but rather it is an item which comes into consideration as part of the capitalists’ settling of accounts with one another, because they distribute the surplus value among themselves according to certain general proportions. Circulation time is not time during which capital creates value, but rather during which it realizes the value created in the production process. It does not increase its quantity, but rather transposes it into another form, from the form of product into that of commodity, from commodity to that of money etc.; the fact that the price which previously existed ideally in the commodity is now really posited, that it is now really exchanged for its price – money – does not, of course, increase this price. Thus circulation time appears as time which does not determine the price; and the number of turnovers, in so far as it is determined by circulation time, appears not in such a way that capital brings in a new value-determining element, an element proper to it, sui generis, as distinct from labour; but rather as a limiting, negative principle. The necessary tendency of capital is therefore circulation without circulation time, and this tendency is the fundamental determinant of credit and of capital’s credit contrivances. At the same time, credit is then also a form in which capital tries to posit itself as distinct from the individual capitals, or the individual capital [tries to posit] itself as capital as distinct from its quantitative barrier. But the highest result it achieves in this line is, on one side, fictitious capital; on the other side, credit only appears as a new element of concentration, of the destruction of capitals by individual, centralizing capitals. Circulation time is in one respect objectified in money. Attempt by credit to posit money as a merely formal moment; so that it mediates the formal transformation without itself being capital, i.e. value. This is one form, of circulation without circulation time. Money is itself a product of circulation. It will be shown how capital, in credit, creates new products of circulation. But if the striving of capital in one direction is circulation without circulation time, it strives in the other direction to give circulation time value, the value of production time, in the various organs which mediate the process of circulation time and of circulation; to posit them all as money, and, more broadly, as capital. This is another side of credit. All this springs from the same source. All the requirements of circulation, money, transformation of commodity into money, transformation of money into commodity etc. – although they take on different and seemingly quite heterogeneous forms, are all derived from circulation time. The machinery for abbreviating it is itself a part of it. Circulation time is that part of capital which may be regarded as the time it takes to perform its specific motion as capital, as distinct from production time, in which it reproduces itself; and in which it lives not as finished capital which must merely pass through formal metamorphoses, but as capital-in-process, creative capital, sucking its living soul out of labour.

The contradiction of labour time and circulation time contains the entire doctrine of credit, to the extent, namely, that the history of currency etc. enters here. Now, of course, later, where circulation time is not the only deduction from possible production time, there also appear real costs of circulation, i.e. values which have already been really posited must be spent on circulation. But these are all in fact only costs – deductions from already created surplus values – which capital undertakes in order to increase the sum of surplus values possible e.g. in a year, i.e. to increase the proportion of production time out of a given total time – i.e. to abbreviate circulation time. Of course, in practice, production time does not really appear interrupted by circulation time (except in crises and depressions of trade). But this is only because every capital is divided into parts, one part in the production phase, the other in the circulation phase. Thus, for example, it is not the entire capital that is active (depending on the relation of circulation time to production time), but only 1/3, 1/x of it; the other is engaged in circulation. Or the matter can further take the form that a given capital doubles (through credit, e.g.). For this capital – the original capital – it is then the same as if circulation time did not exist at all. But then the capital borrowed by it is in this plight. And if ownership is disregarded, again exactly the same as if one capital were divided in two. Instead of a dividing into two and b dividing into two, a absorbs b and divides into a and b. Illusions about this process frequent among credit-mystics [59] (who are rarely creditors, but rather debtors).

We already pointed out above that the double and contradictory condition of capital, the continuity of production and the necessity of circulation time, and also the continuity of circulation (not circulation time) and the necessity of production time, can be mediated only by capital dividing itself into parts, of which one circulates as finished product, and the other reproduces itself in the production process. These parts alternate; when one part returns into phase P (production process), the other departs. This process takes place daily, as well as at longer intervals (dimensions of time). The whole capital and the total value are reproduced as soon as both parts have passed through the production process and circulation process, or as soon as the second part enters anew into circulation. The point of departure is thereby the terminal point. The turnover therefore depends on the size of the capital, or rather, here, still on the total sum of these two parts. Only when the total sum is reproduced has the entire turnover been completed; otherwise only 1/2, 1/3, 1/x, depending on the relation of the constantly circulating part.

It has further been emphasized that each part can be regarded as fixed or as circulating in contrast to the other, and that they really relate to each other in this alternating way. The simultaneity of the process of capital in different phases of the process is possible only through its division and break-up into parts, each of which is capital, but capital in a different aspect. This change of form and matter is like that in the organic body. If one says e.g. the body reproduces itself in 24 hours, this does not mean it does it all at once, but rather the shedding in one form and renewal in the other is distributed, takes place simultaneously. Incidentally, in the body the skeleton is the fixed capital; it does not renew itself in the same period of time as flesh, blood. There are different degrees of speed of consumption (self-consumption) and hence of reproduction. (Here, then, already transition to many capitals.) The important thing here above all is to examine capital as such for itself first of all; since the aspects being developed here are those which make value in general into capital; which constitute the specific distinguishing characteristics of capital as such.

Before we go further, let us call attention once more to the important point that circulation time – i.e. the time during which capital is separated from the process in which it absorbs labour, i.e. the labour time of capital as capital – is only the transposition of previously created value from one form into the other, but not a value-creating, value-increasing element. The transformation of a value of 4 working days existing in the form of twist into the form of 4 working days existing as money, or of a symbol recognized as the representative of 4 working days as such, 4 working days in general, transposes the previously created and measured value from one form into another, but that value is not increased. The exchange of equivalents leaves the working days after the exchange just as they were before, qua amounts of value. If one thinks of one capital, or one thinks of the various capitals of a country as one capital (national capital) as distinct from that of other countries, then it is clear that the time during which this capital does not act as productive capital, i.e. posits no surplus value, is a deduction from the realization time available to this capital. In this abstract conception, still without any regard to the costs of circulation itself, it appears as the negation not of the really posited realization time, but of the possible realization time, i.e. possible if circulation time = 0. It is clear, now, that the national capital cannot regard the time during which it does not multiply itself as time in which it does multiply itself, no more than e.g. an isolated peasant can regard the time during which he can neither harvest nor sow, during which his labour generally is interrupted, as time which makes him rich. The fact that capital regards itself, and necessarily so, as productive and fruit-bearing independently of labour, of the absorption of labour, assumes itself as fertile at all times, and calculates its circulation time as value-creating time – as production cost – is quite another thing. In this way one can see what is wrong when e.g. Ramsay says: ‘the use of fixed capital modifies to a considerable extent the principle that value depends on quantity of labour. For some commodities on which the same quantity of labour has been expended require very different periods before they are fit for consumption. But as during this time the capital brings no return, in order that the employment in question should not be less lucrative than others in which the produce is sooner ready for use, it is necessary that the commodity, when at last brought to market, should be increased in value by all the amount of profit withheld.’ (This already assumes that capital as such regularly brings profit, like a healthy tree brings fruit.) ‘This shews … how capital may regulate value independently of labour.’ [60] E.g. wine in the cellar. (Ramsay, IX, 84.) Here as if circulation time as well as labour time – or on the same level with it – produced value. Capital, of course, contains both moments in itself. (1) Labour time as a value-creating moment. (2) Circulation time as a moment which restricts labour time and thus restricts the total value creation of capital; as necessary, because value, or capital, as an immediate result of the production process, is indeed value, but value not posited in its adequate form. The time which is required for these changes of form – i.e. which elapses between production and reproduction – is time which devalues capital. Thus, like continuity, so is the interruption of continuity contained in the character of capital as circulating, in process.

The economists who correctly characterize circulation, the revolution which capital must go through to fire itself up for new production, as a series of exchanges thereby admit that this circulation time is not time which increases the quantity of values – hence it cannot be time which posits new values – because a series of exchanges, no matter how many exchanges it may include, and how much time the completion of these operations may cost, is merely the exchange of equivalents. The positing of values – the extremes of the mediation – as equivalents naturally cannot posit them as non-equivalents. Regarded quantitatively, they can have neither increased nor diminished through the exchange.

The surplus value of a production phase is determined by the surplus labour set in motion (appropriated) by capital during it; the sum of the surplus values a capital can create in a given period of time is determined by the repetition of the production phase in this period of time; or by the turnover of capital. The turnover, however, equals the duration of the production phase plus the duration of circulation, equals the sum of circulation time and production time. The turnover approaches production time as circulation time diminishes, i.e. the time which elapses between capital’s departure from production and its return to it.

Surplus value is in fact determined by the labour time objectified during one production phase. The more frequent the reproduction of capital, the more often does the production of surplus value take place. The number of reproductions = the number of turnovers. Hence the total surplus value = S × nR (if n is the number of turnovers). S′ = S × nR; hence S = S′/nR. If the production time required by a capital of £100 in a certain branch of industry equals 3 months, then it could turn over 4 times a year, and if the S-value created each time = 5, then the total surplus value = 5 (the S created in one production phase) × 4 (the number of turnovers, determined by the relation of production time to the year) = 20. But if circulation time = e.g. 1/4 of production time, then 1 turnover would = 3 + 1 months, equals 4 months, and the capital of 100 could turn over only 3 times a year = 15. Hence, although the capital posits an S-value of £5 in 3 months, it is the same for it as if it posited a value of 5 in only 4 months, because it can only posit 5 × 3 per year. It is the same for it as if it produced an S of 5 every 4 months; hence produced only 15/4 or 3 3/4 in 3 months, and in the one circulation month, 1 1/4. In so far as turnover is distinct from the duration posited by the conditions of production, it is = to circulation time. The latter, however, is not determined by labour time. In this way the sum of surplus values which capital posits in a given period of time appears determined not simply by labour time, but by labour time as well as circulation time, in the relations indicated above. But, as shown above, the determination which capital here brings into the positing of value is negative, limiting.

If e.g. a capital of £100 needs 3 months for production, say 90 days, then, if circulation time = 0, the capital could turn over 4 times a year; and it would be entirely active as capital the whole time, i.e. positing surplus labour, multiplying its value. If 80 of the 90 days represented necessary labour, then 10, surplus labour. Now posit that circulation time amounts to 33 1/3% of production time, or 1/3 of it. Hence 1 month for every 3. Circulation time then = 90/3; a third of production time = 30 days, c = 1/3 p; (c = p/3). Well. The question is, what part of the capital can now continuously be occupied in production (during the whole year)? If the capital of 100 had worked 90 days, and then circulated as a product of 105 for one month, then during this month it could employ no labour at all. (The 90 working days can of course equal 3, 4, 5, x times 90, depending on the number of workers employed during the 90 days. These would be = to only 90 days if only 1 worker were employed. But this is beside the point for now.) (In all these calculations it is presupposed that the surplus value is not in turn capitalized, but that capital rather continues to work with the same number of workers; but at the same time as the surplus is realized, the entire capital is only then realized as money.) That is, during one month the capital could not be employed at all. (The capital of 100 employs e.g. 5 workers continuously; this contains their surplus labour, and the product which is circulated is never the original capital, but rather that which has absorbed this surplus labour and hence has a surplus value. Hence the circulation of a capital of 100 actually means e.g. circulation of the capital of 105; i.e. of capital together with the profit posited in one act of production. But this error irrelevant here, particularly in the above question.)

(Posit that at the end of 3 months £100 worth of twist have been produced.) Now it will be 1 month before the money comes in and I can begin production again. Now, in order to set the same number of workers to work during the I month while the capital is circulating, I would have to have a surplus capital of £33 1/3; for if £100 set a given quantity of labour in motion for 3 months, then 1/3 of £100 would set it in motion for 1 month. At the end of the fourth month, the capital of 100 would return to the production phase, and that of 33 1/3 would enter the circulation phase. The latter would require 1/3 of a month for circulation, given the same relations; would hence return into production after 10 days. The first capital could enter into circulation again only at the end of the seventh month. The second, which entered into circulation at the beginning of the fifth month, would have returned say on the 10th of the fifth month, would re-enter circulation on the 10th of the sixth month and would return on the 20th of the sixth month, to re-enter circulation on the 20th of the seventh month; at the end of the seventh month it would be back again, at which time the first capital would just be beginning its course again at the same moment when the second was returning. Beginning of the eighth month, and return on the etc. Beginning of the ninth etc. In a word: if the capital were 1/3 larger – just the amount the circulation time adds up to – then it could continuously employ the same number of workers. Or, alternately, it could continuously remain in the production phase if it continuously employed 1/3 less labour. If the capitalist began with a capital of only 75, then production would finish at the end of the third month; then the capital would circulate for one month; but during this month he could continue production because he would have retained a capital of 25, and, if he needs 75 to set a given mass of labour in motion during 3 months, he needs 25 to set the same in motion for 1 month. He would continuously have the same number of workers at work. Each of his commodities requires 1/12 of a year before it is sold.

If he always needs 1/3 of the production time to sell his commodities, then etc. This matter must be reducible to a very simple equation, to which we shall return later. It does not actually belong here. But the question is important because of the credit questions later. This much is clear, however. Call production time pt, circulation time ct. Capital, C. C cannot be in its production phase and its circulation phase at the same time. If it is to continue to produce while it circulates, then it must break into two parts, of which one in the production phase, while the other in the circulation phase, and the continuity of the process is maintained by part a being posited in the former aspect, part b in the latter. Let the portion which is always in production be x; then x = C − b (let b be the part of the capital always in circulation). C = b + x. If ct, circulation time, were = 0, then b likewise would be = 0, and x = C. b (the part of the capital in circulation):C (the total capital) = ct (circulation time):pt (production time); b:C = ct:pt; i.e. the relation of circulation time to production time is the relation of the part of capital in circulation to the total capital.

If a capital of 100 at a profit of 5% turns over every 4 months, so that there is 1 month of circulation time for every 3 months of production time, then the total surplus value, as we saw, will be = (5 × 12)/4 M (month) = 5 × 3 = 15; instead of 20 as when c = 0; for then S′ = (5 × 12)/3 = 20. But now 15 is the gain on a capital of 75 at 5% whose circulation time = 0; which turned over 4 times a year; was continuously occupied. At the end of the first quarter 3 3/4; at the end of the year 15. (But only a total capital of 300 would turn over; while one of 400 if in the above case ct = 0.) Hence a capital of 100, with respect to which circulation time amounts to 1 month on every 3 M production time, can constantly employ productively a capital of 75; a capital of 25 is constantly circulating and unproductive. 75:25 = 3 M:1 M, or, if we call the part of the capital occupied in production p, the part in circulation c, and the corresponding times c′ and p′, then p:c = p′:c′ (p:c = 1:1/3). The part of the C in production constantly relates to the part in circulation as 1:1/3; this 1/3 constantly represented by changing component parts. But p:C = 75:100 = 3/4; c = 1/4; p:C = 1:4/3 and c:C = 1:4. The total turnover = 4 M, p:R = 3 M:4 M = 1:4/3.

##### Change of form and of matter in the circulation of capital. – C–M–C. M–C–M.

A change of form [Formwechsel] and a change of matter [Stoffwechsel] take place simultaneously in the circulation of capital. We must begin here not with the presupposition of M, but with the production process. In production, as regards the material side, the instrument is used up and the raw material is worked up. The result is the product – a newly created use value, different from its elemental presuppositions. As regards the material side, a product is created only in the production process. This is the first and essential material change. On the market, in the exchange for money, the product is expelled from the circulation of capital and falls prey to consumption, becomes object of consumption, whether for the final satisfaction of an individual need or as raw material for another capital. In the exchange of the commodity for money, the material and the formal changes coincide; for, in money, precisely the content itself is part of the economic form. The retransformation of money into commodity is here, however, at the same time present in the retransformation of capital into the material conditions of production. The reproduction of a specific use value takes place, just as well as of value as such. But, just as the material element here was posited, from the outset, at its entry into circulation, as a product, so the commodity in turn was posited as a condition of production at the end of it. To the extent that money figures here as medium of circulation, it does so indeed only as mediation of production, on one side with consumption, in the exchange where capital discharges value in the form of the product, and as mediation, on the other side, between production and production, where capital discharges itself in the form of money and draws the commodity in the form of the condition of production into its circulation. Regarded from the material side of capital, money appears merely as a medium of circulation; from the formal side, as the nominal measure of its realization, and, for a specific phase, as value-for-itself; capital is therefore C–M–M–C just as much as it is M–C–C–M, and this in such a way, specifically, that both forms of simple circulation here continue to be determinants, since M–M is money, which creates money, and C–C a commodity whose use value is both reproduced and increased. In regard to money circulation, which appears here as being absorbed into and determined by the circulation of capital, we want only to remark in passing – for the matter can be thoroughly treated only after the many capitals have been examined in their action and reaction upon one another – that money is obviously posited in different aspects here.

##### Difference between production time and labour time. – Storch. Money. Mercantile estate. Credit. Circulation

Until now it has been assumed that production time coincides with labour time. But now there take place, e.g. in agriculture, interruptions of work within the production process itself, before the product is finished. The same labour time may be applied and the duration of the production phase may differ, because work is interrupted. If the difference is only that the product in one case requires a longer working time in order to be finished than in another case, then no case at all is constituted, because it is then clear according to the general law that the product in which a greater quantity of labour is contained is of that much greater value, and if the reproduction is less frequent in a given period of time, then the reproduced value is all the greater. And 2 × 100 is just as much as 4 × 50. As with the total value, then, so with the surplus value. The question is constituted by the unequal duration required by different products, although the same amount of labour time (namely stored-up and living labour together) is employed upon them. The fixed capital here allegedly acts quite by itself, without human labour, like e.g. the seed entrusted to the earth’s womb. In so far as additional labour is required, this is to be deducted. The question to be posed in pure form. If circulation time here the same, then the turnover is less frequent because the production phase longer. Hence production time + turnover time = 1R, larger than in the case where production time coincides with labour time. The time required here for the product to reach maturity, the interruptions of work, here constitute conditions of production. Not-labour time constitutes a condition for labour time, in order to turn the latter really into production time. The question obviously belongs only with the equalization of the rate of profit. Still, the ground must be cleared here. The slower return – this is the essential part – here arises not from circulation time, but rather from the conditions themselves in which labour becomes productive; it belongs with the technological conditions of the production process. It must absolutely be denied, it is downright nonsensical to claim, that a natural circumstance which hinders a capital in a specific branch of production from exchanging with the same amount of labour time in the same amount of time as another capital in another branch of production can in any way contribute to increasing the former’s value. Value, hence also surplus value, is not = to the time which the production phase lasts, but rather to the labour time, objectified and living, employed during this production phase. The living labour time alone – and, indeed, in the proportion in which it is employed relative to objectified labour time – can create surplus value, because [it creates] surplus labour time. * It has therefore correctly been asserted that in this regard agriculture for instance is less productive (productivity is concerned here with the production of values) than other industries. Just as in another respect – in so far as a growth of productivity in it DIRECTLY reduces necessary labour time – it is more productive than all the others. But this circumstance can accrue to its advantage only where capital already rules, together with the general form of production corresponding to it. This interruption in the production phase already signifies that agriculture can never be the sphere in which capital starts; the sphere in which it takes up its original residence. This contradicts the primary fundamental conditions of industrial labour. Hence agriculture is claimed for capital and becomes industrial only retroactively. Requires a high development of competition on one side, on the other a great development of chemistry, mechanics etc., i.e. of manufacturing industry. History shows, consequently, that agriculture never appears in pure form in the modes of production preceding capital, or which correspond to its own undeveloped stages. A rural secondary industry, such as spinning, weaving etc. must make up for the limit on the employment of labour time posited here – and located in these interruptions. The non-identity of production time with labour time can be due generally only to natural conditions, which stand directly in the path of the realization of labour, i.e. the appropriation of surplus labour by capital. These obstacles in its path do not of course constitute advantages, but rather, from its point of view, losses. The whole case is worth mentioning here actually only as an example of fixated capital, capital fixated in one phase. The point to remember here is only that capital creates no surplus value as long as it employs no living labour. The reproduction of the employed fixed capital itself is of course not the positing of surplus value.

* It is clear that other aspects also enter in with the equalization of the rate of profit. Here, however, the issue is not the distribution of surplus value but its creation.

(In the human body, as with capital, the different elements are not exchanged at the same rate of reproduction, blood renews itself more rapidly than muscle, muscle than bone, which in this respect may be regarded as the fixed capital of the human body.)

As means of speeding up circulation, Storch lists: (1) formation of a class of ‘workers’ who busy themselves only with trade; (2) easy means of transport; (3) money; (4) credit. (See above.) [61]

This motley combination reveals the whole confusion of the political economists. Money and money circulation – what we called simple circulation – is the presupposition, condition, of capital itself, as well as of the circulation of capital. Money as it exists, hence, as a relation of intercourse belonging to a stage of production preceding capital, money as money, in its immediate form, can therefore not be said to speed up the circulation of capital, but is rather its presupposition. When we speak of capital and of its circulation, we stand on a stage of social development where the introduction of money does not enter as a discovery etc., but is rather a presupposition. To the extent that money in its immediate form itself has value, and is not merely the value of other commodities, the symbol of their value – for, if something which is itself immediate is supposed to be something else which is also immediate, then it can only represent the latter, in one way or another, as symbol – but rather, itself has value, is itself objectified labour in a specific use value, to that extent, money, so far from speeding up the circulation of capital, rather delays it. Regarded in both of the aspects in which it occurs in the circulation of capital, both as medium of circulation and as the realized value of capital, money belongs among the costs of circulation in so far as it is itself labour time employed to abbreviate circulation time on the one hand, and, on the other hand, to represent a qualitative moment of circulation – the retransformation of capital into itself as value-for-itself. In neither aspect does it increase the value. In one aspect it is a precious form of representing value, i.e. a costly form, costing labour time, hence representing a deduction from surplus value. In the other aspect it can be regarded as a machine which saves circulation time, and hence frees time for production. But, in so far as it itself, as such a machine, costs labour and is a product of labour, it represents for capital faux frais de production. It figures among the costs of circulation. The original cost of circulation is circulation time itself as opposed to labour time. The real costs of circulation are themselves objectified labour time – machinery for the purpose of abbreviating the original costs of circulation. Money in its immediate form, as it belongs to a historic stage of production preceding capital, thus appears to capital as a cost of circulation, and the efforts of capital hence tend in the direction of transforming it into a form adequate for its own ends; hence attempting to make it into a representative of one moment of circulation which does not itself cost labour, and has itself no value. Capital hence tends in the direction of suspending money in its inherited, immediate reality, and transforming it into something merely posited and at the same time suspended by capital, into something purely ideal. It cannot be said, therefore, as does Storch, that money as such is a means of speeding up the circulation of capital; it must rather be said to the contrary that capital attempts to transform money into a merely ideal moment of its circulation, and first to raise it into the adequate form corresponding to it. Suspension of money in its immediate form appears as a demand made by money circulation once it has become a moment of the circulation of capital; because in its immediate, presupposed form it is a barrier to the circulation of capital. The tendency of capital is circulation without circulation time; hence also the positing of the instruments which merely serve to abbreviate circulation time as mere formal aspects posited by it, just as the different moments through which capital passes in its circulation are qualitative aspects of its own metamorphosis.

As regards the formation of a special mercantile estate – i.e. a development of the division of labour which has transformed the business of exchanging into a particular kind of work – for which, of course, the sum of exchange operations must already have reached a certain height – (if the exchange among 100 people occupied the 100th part of their labour time, then each man is 1/100 of an exchanger; 100/100 exchangers would represent one single man. Then one merchant could arise per 100. The separation of commerce from production itself, or the development of exchange itself as a representation opposite the exchangers, requires as such that exchange and intercourse have developed to a certain degree. The merchant represents all buyers to the seller, all sellers to the buyer and vice versa, hence he is not an extreme, but rather the middle of the exchange itself; appears hence as mediator, middleman) – the formation of the merchant estate, which presupposes that of money, even if not developed in all its moments, is likewise a presupposition for capital, and hence cannot be listed as being a mediator of its specific circulation. Since commerce is both historically as well as conceptually a presupposition for the rise of capital, we shall have to return to it before concluding this chapter, since it belongs before or in the section on the origin of capital.

The facilitation of the means of transport, to the extent that it means facilitation of the physical circulation of commodities, does not belong here, where we are examining merely the characteristic forms of the circulation of capital. The product becomes a commodity, leaves the production phase, only when it is on the market. On the other side, the means of transportation do belong here in so far as the returns of capital – i.e. circulation time – must grow with the distance of the market from the point of production. Its abbreviation by means of transport thus appears as belonging directly, in this respect directly, to the examination of the circulation of capital. But this actually belongs to the doctrine of the market, which itself belongs to the section on capital.

Finally, credit. This form of circulation etc. directly posited by capital – which arises, hence, specifically from the nature of capital, this specific characteristic of capital – is mixed up here by Storch etc. together with money, mercantile estate, etc., which belong generally with the development of exchange and of the production more or less founded on it. The presentation of the specific, distinguishing characteristics is here both the logical development and the key to the understanding of the historical development. Thus we find in history, too, e.g. in England (likewise in France), [attempts] to replace money by paper; then also to give capital, in so far as it exists in the form of value, a form purely posited by itself; finally attempts to found credit directly with the rise of capital. (E.g. Petty, Boisguillebert.)

##### Small-scale circulation. The process of exchange between capital and labour capacity generally. Capital in the reproduction of labour capacities

Within circulation as the total process, we can distinguish between large-scale and small-scale circulation. The former spans the entire period from the moment when capital exits from the production process until it enters it again. The second is continuous and constantly proceeds simultaneously with the production process. It is the part of capital which is paid out as wages, exchanged for labouring capacity. The circulation process of capital, which is posited in the form of an exchange of equivalents, but is in fact suspended as such, and posited as such only formally (the transition from value to capital, where the exchange of equivalents turns into its opposite, and where, on the basis of exchange, exchange becomes purely formal, and the mutuality is all on one side), is to be developed in this way: Values which become exchanged are always objectified labour time, an objectively available, reciprocally presupposed quantity of labour (present in a use value). Value as such is always an effect, never a cause. It expresses the amount of labour by which an object is produced, hence – presupposing the same stage of the productive forces – the amount of labour by which it can be reproduced. The capitalist does not exchange capital directly for labour or labour time; but rather time contained, worked up in commodities, for time contained, worked up in living labour capacity. The living labour time he gets in exchange is not the exchange value, but the use value of labour capacity. Just as a machine is not exchanged, paid for as cause of effects, but as itself an effect; not according to its use value in the production process, but rather as product – definite amount of objectified labour. The labour time contained in labour capacity, i.e. the time required to produce living labour capacity, is the same as is required – presupposing the same stage of the productive forces – to reproduce it, i.e. to maintain it. Hence, the exchange which proceeds between capitalist and worker thus corresponds completely to the laws of exchange; it not only corresponds to them, but also is their highest development. For, as long as labour capacity does not itself exchange itself, the foundation of production does not yet rest on exchange, but exchange is rather merely a narrow circle resting on a foundation of non-exchange, as in all stages preceding bourgeois production. But the use value of the value the capitalist has acquired through exchange is itself the element of realization and its measure, living labour and labour time, and, specifically, more labour time than is objectified in labour capacity, i.e. more labour time than the reproduction of the living worker costs. Hence, by virtue of having acquired labour capacity in exchange as an equivalent, capital has acquired labour time – to the extent that it exceeds the labour time contained in labour capacity – in exchange without equivalent; it has appropriated alien labour time without exchange by means of the form of exchange. This is why exchange becomes merely formal, and, as we saw, in the further development of capital even the semblance is suspended that capital exchanges for labour capacity anything other than the latter’s own objectified labour; i.e. that it exchanges anything at all for it. The turn into its opposite [Umschlag] therefore comes about because the ultimate stage of free exchange is the exchange of labour capacity as a commodity, as value, for a commodity, for value; because it is given in exchange as objectified labour, while its use value, by contrast, consists of living labour, i.e. of the positing of exchange value. The turn into its opposite arises from the fact that the use value of labour capacity, as value, is itself the value-creating force; the substance of value, and the value-increasing substance. In this exchange, then, the worker receives the equivalent of the labour time objectified in him, and gives his value-creating, value-increasing living labour time. He sells himself as an effect. He is absorbed into the body of capital as a cause, as activity. Thus the exchange turns into its opposite, and the laws of private property – liberty, equality, property – property in one’s own labour, and free disposition over it – turn into the worker’s propertylessness, and the dispossession [Entäusserung] of his labour, [i.e.] the fact that he relates to it as alien property and vice versa.

The circulation of the part of capital which is posited as wages accompanies the production process, appears as an economic form-relation alongside it, and is simultaneous and interwoven with it. This circulation alone posits capital as such; is the condition of its realization process, and posits not only the latter’s characteristic form, but also its substance. This is the constantly circulating part of capital, which at no time enters into the production process itself, [but] constantly accompanies it. It is the part of capital which does not even for a single instant enter into its reproduction process, which is not the case with raw material. The worker’s approvisionnement arises out of the production process, as product, as result; but it never enters as such into the production process, because it is a finished product for individual consumption, enters directly into the worker’s consumption, and is directly exchanged for it. This, therefore, as distinct from raw material as well as instrument, is the circulating capital ϰατ᾽ ἐξοχήν. Here is the only moment in the circulation of capital where consumption enters directly. At the point where the commodity becomes exchanged for money, it may be acquired by another capital as raw material for new production. Further, given the presuppositions, capital encounters not the individual consumer but rather the merchant; someone who buys the commodity itself in order to sell it for money. (This presupposition is to be developed in connection with the merchant estate in general. The circulation among dealers thereby different from that between dealers and consumers.) Thus the circulating capital here appears directly as that which is specified for the workers’ individual consumption; specified for direct consumption generally, and hence existing in the form of finished product. Thus, while in one respect capital appears as the presupposition of the product, the finished product also at the same time appears as the presupposition of capital – which means, historically, that capital did not begin the world from the beginning, but rather encountered production and products already present, before it subjugated them beneath its process. Once in motion, proceeding from itself as basis, it constantly posits itself ahead of itself in its various forms as consumable product, raw material and instrument of labour, in order constantly to reproduce itself in these forms. They appear initially as the conditions presupposed by it, and then as its result. In its reproduction it produces its own conditions. Here, then – through the relation of capital to living labour capacity and to the natural conditions of the latter’s maintenance – we find circulating capital specified in respect of its use value as well, as that which enters directly into individual consumption, to be directly used up by the latter. It is a mistake to conclude from this, as has been done, [62] that circulating capital is therefore consumable capital generally, as if coal, oil, dye etc., instruments etc., improvements of the land etc. factories etc. were not all consumed likewise, if by consumption is meant the suspension of their use value and of their form; however, one could just as well say that none of them is consumed, if this is taken to mean individual consumption, i.e. consumption in the proper sense. In this circulation, capital constantly expels itself as objectified labour, in order to assimilate living labour power, its life’s breath. Now, as regards the worker’s consumption, this reproduces one thing – namely himself, as living labour capacity. Because this, his reproduction, is itself a condition for capital, therefore the worker’s consumption also appears as the reproduction not of capital directly, but of the relations under which alone it is capital. Living labour capacity belongs just as much among capital’s conditions of existence as do raw material and instrument. Thus it reproduces itself doubly, in its own form, [and] in the worker’s consumption, but only to the extent that it reproduces him as living labour capacity. Capital therefore calls this consumption productive consumption – productive not in so far as it reproduces the individual, but rather individuals as labour capacities. If Rossi is offended that wages are allegedly counted twice, first as the worker’s revenue, then as reproductive consumption of capital, [63] then the objection holds only against those who let wages enter directly into the production process of capital as value. For the payment of wages is an act of circulation which proceeds simultaneously with and alongside the act of production. Or, as Sismondi says from this perspective – the worker consumes his wages unreproductively; but the capitalist consumes them productively, since he gets labour in the exchange, which reproduces the wages and more than the wages. This concerns capital itself regarded merely as an object. But in so far as capital is a relation, and, specifically, a relation to living labour capacity, [to that extent] the worker’s consumption reproduces this relation; or, capital reproduces itself doubly, as value through purchase of labour – as a possibility of beginning the realization process anew, of acting as capital anew – and as a relation through the worker’s consumption, which reproduces him as labour capacity exchangeable for capital – wages as part of capital.

This circulation between capital and labour, then, yields the characterization of one part of capital as constantly circulating, the approvisionnement; constantly consumed; constantly to reproduce. This circulation strikingly reveals the difference between capital and money; the circulation of capital and the circulation of money. Capital pays wages e.g. weekly; the worker takes his wages to the grocer etc.; the latter directly or indirectly deposits them with the banker; and the following week the manufacturer takes them from the banker again, in order to distribute them among the same workers again, etc. and so forth. The same sum of money constantly circulates new portions of capital. The sum of money itself, however, does not determine the portions of capital which are thus circulated. If the money value of wages rises, then the circulating medium will increase, but the mass of the medium does not determine the rise. If the production costs of money did not fall, then no increase of money would exercise an influence on the portion of it entering into this circulation. Here money appears as mere medium of circulation. Since many workers are to be paid at the same time, a certain sum of money is required at one time, which grows with the number of workers. Then, however, the velocity of the circulation of the money makes a lesser sum necessary than in situations where there are fewer workers but the machinery of monetary circulation is not so arranged. This circulation is a condition of the production process and thereby of the circulation process as well. On the other hand, if capital does not return from circulation, then this circulation between worker and capital could not begin anew; hence it is itself conditional upon capital passing through the various moments of its metamorphosis outside the production process. If this did not happen, it would be not because there was not enough money as medium of circulation, but rather either because capital was not available in the form of products, because this part of circulating capital was lacking, or because capital did not posit itself in the form of money, i.e. did not realize itself as capital, which in turn, however, would arise not from the quantity of the medium of circulation, but because capital did not posit itself in the qualitative aspect of money, which in no way requires that it posit itself in the form of hard cash, in the immediate money form; and whether or not it posited itself in that form would again depend not on the quantity of money circulating as medium of circulation, but rather on the exchange of capital for value as such; again a qualitative, not a quantitative, moment, as we shall point out in more detail when we speak of capital as money. (Interest etc.)

##### Threefold character, or mode, of circulation. – Fixed capital and circulating capital. – Turnover time of the total capital divided into circulating and fixed capital. – Average turnover time of such a capital. – Influence of fixed capital on the total turnover time of capital. – Circulating fixed capital. Say. Smith. Lauderdale. (Lauderdale on the origin of profit)

Regarded as a whole, circulation thus appears threefold: (1) the total process – the course of capital through its different moments; accordingly, it is posited as being in flow; as circulating; in so far as the continuity is virtually interrupted, and may resist the passage into the next phase, capital here likewise appears as fixated in different relations, and the various modes of this fixation constitute different capitals, commodity capital, money capital, capital as conditions of production.

(2) Small-scale circulation between capital and labour capacity. This accompanies the production process and appears as contract, exchange, form of intercourse; these things are presupposed before the production process can be set going. The part of capital entering into this circulation – the approvisionnement – is circulating capital ϰατ᾽ ἐξοχήν. It is specified not only in respect to its form; in addition to this, its use value, i.e. its material character as a consumable product entering directly into individual consumption, itself constitutes a part of its form.

(3) Large-scale circulation; the movement of capital outside the production phase, where its time appears in antithesis to labour time, as circulation time. The distinction between fluid and fixed capital is the product of this opposition between the capital engaged in the production phase and the capital which issues from it. Fixed is that which is fixated in the production process and is consumed within it; comes out of large-scale circulation, certainly, but does not return into it, and, in so far as it circulates, circulates only in order to be consumed in, confined to, the consumption process.

The three different distinctions in the circulation of capital yield the three distinctions between circulating and fixated capital; they posit one part of capital as circulating ϰατ᾽ ἐξοχήν, because it never enters into the production process, but constantly accompanies it; and thirdly, [they yield] the distinction between fluid and fixed capital. Circulating capital in form No. 3 also includes No. 2, since the latter is also in antithesis to the fixed; but No. 2 does not include No. 3. The part of capital which belongs as such to the production process is the part of it which serves, materially, only as means of production; forms the link between living labour and the material to be worked on. A part of the liquid capital, such as coal, oil etc., also serves merely as means of production. Everything which serves merely as a means to keep the machine, or the engine, running. This distinction will have to be examined yet more closely. First of all, this does not contradict aspect 1, since the fixed capital as value also circulates in proportion as it is worn out. Precisely in this aspect as fixed capital – i.e. in the character in which capital has lost its fluidity and become identified with a specific use value, which robs it of its ability to transform itself – does developed capital – to the extent we know it so far, as productive capital – most strikingly manifest itself, and it is precisely in this seemingly inadequate form, and in the latter’s increasing relation to the form of circulating capital in No. 2, that the development of capital as capital is measured. This contradiction pretty. To be developed.

The different kinds of capital, which, in economics, fall out of the sky, here appear as so many precipitates of the movements arising out of the nature of capital itself, or rather of this movement itself in its different moments.

Circulating capital constantly ‘parts’ from the capitalist, in order to return to him in the first form. Fixed capital does not (Storch). [64] ‘Circulating capital is that portion of the capital which does not yield profit till it is parted with; fixed etc. yields such profit, while it remains in the possession of the owner.’ (Malthus.) [65] ‘Circulating capital gives its master no revenue or profit, so long as it remains in his possession; fixed capital gives this profit without changing masters, and without requiring circulation.’ (A. Smith.) [66]

In this respect, since capital’s departure on a voyage away from its owner (‘partir de son possesseur’) [67] means nothing more than the sale of property or possessions which takes place in the act of exchange, and since it is the nature of all exchange value, hence all capital, to become value for its owner by means of sale, the definition in its above formulation cannot be correct. If fixed capital were [capital] for its owner without the mediation of exchange and of the use value [68] included in it, then, in fact, fixed capital would be a mere use value, hence not capital. But the basis of the above definition is this: fixed capital circulates as value (even if only in portions, successively, as we shall see). It does not circulate as use value. As far as its material aspect is concerned, as a moment of the production process, fixed capital never leaves its boundaries; is not sold by its possessor; remains in his hand. It circulates as capital only in its formal aspect, as self-eternalizing value. This distinction between form and content, use value and exchange value, does not take place in circulating capital. In order to circulate, to exist, as the latter, it has to step into circulation as the former, must be sold. Use value for capital as such is only value itself. Circulating capital realizes itself as value for capital as such only when it is sold. As long as it remains in its hand, it only has value in itself; but it is not posited; only in potency – but not in act. Fixed capital, by contrast, realizes itself as value only as long as it remains in the capitalist’s hand as a use value, or, expressed as an objective relation, as long as it remains in the production process, which may be regarded as the inner organic movement of capital, its relation to itself, as opposed to its animal movement, its presence for another. Hence, since fixed capital, once it has entered the production process, remains in it, it also passes away in it, is consumed in it. The duration of this consumption does not yet concern us here. In this respect, then, fixed capital also includes what Cherbuliez calls the matières instrumentales, [69] such as coal, oil, wood, grease etc., which are completely destroyed in the production process, which only have a use value for the process of production itself. The same materials, however, also have a use value outside production, and can also be consumed in another way, just as buildings, houses, etc. are not necessarily specified for production. They are fixed capital not because of the specific mode of their being, but rather because of their use. They become fixed capital as soon as they step into the production process. They are fixed capital, as soon as they are posited as moments of the production process of capital; because they then lose their property of being potentially circulating capital.

Therefore, just as the part of capital entering into the small-scale circulation of capital – or capital, in so far as it enters into this movement – circulation between capital and labour capacity, the part of capital circulating as wages – never leaves the circulation process and never enters into the production process of capital, as regards its material aspect, as use value, but rather is always ejected from a previous production process as its product, result, so, inversely, does the part of capital specified as fixed capital, as a use value, as regards its material presence, never leave the production process and never go back into circulation. While the latter only enters into circulation as value (as part of the value of the finished product), the former only enters into the production process as value, in that necessary labour is the reproduction of wages, of the part of the capital’s value which circulates as wages. This, then, is the first characteristic of fixed capital, and in this respect it also includes the matières instrumentales.

Secondly: Fixed capital can enter into circulation as value, however, only to the extent that it passes away as use value in the production process. It passes, as value, into the product – i.e. as labour time worked up or stored up in it – in so far as it passes away in its independent form as use value. In being used, it is used up, but in such a way that its value is carried over from its form into the form of the product. If it is not used, not consumed in the production process itself – if the machinery stands still, the iron rusts, the wood rots – then of course its value passes away together with its transitory presence as use value. Its circulation as value corresponds to its consumption in the production process as use value. Its total value is completely reproduced, i.e. is fully returned via circulation only when it has been completely consumed as use value in the production process. As soon as it is completely dissolved into value, and hence completely absorbed into circulation, it has completely passed away as use value and hence must be replaced, as a necessary moment of production, by a new use value of the same kind, i.e. must be reproduced. The necessity of reproducing it, i.e. its reproduction time, is determined by the time in which it is used up, consumed within the production process. With circulating capital, reproduction is determined by circulation time; with fixed capital, circulation is determined by the time in which it is consumed as use value, in its material presence, within the act of production, i.e. by the period of time within which it must be reproduced. A thousand pounds of twist can be reproduced as soon as they are sold and the money obtained for them is again exchanged for cotton, in short, for the elements of the production of twist. Their reproduction is determined, hence, by circulation time. A machine of a value of £1,000 which lasts 5 years, which is used up in 5 years and then becomes nothing more than scrap iron, is used up, say, by 1/5 per year, if we take the average consumption in the production process. Hence every year only 1/5 of its value enters into circulation, and only with the passing of the 5 years has it completely gone into circulation and returned from it. Its entry into circulation is thus purely determined by the time of its wearing out; and the time which its value needs to enter totally into circulation and to return from it is determined by its total reproduction time, the time in which it must be reproduced. Fixed capital enters into the product only as value; while the use value of circulating capital has remained in the product as the latter’s substance, and has merely obtained another form. This distinction essentially modifies the turnover time of a total capital divided into circulating and fixed capital. Let total capital = S; its circulating part = c; its fixed part = f; let the fixed capital form 1/x S; the circulating capital S/y. Let the circulating capital turn over 3 times a year, the fixed capital only twice every 10 years. In 10 years, f or S/x will turn over twice; while in the same 10 years S/y will turn over 3 × 10 = 30 times. If S were = S/y, i.e. circulating capital only, then R, its turnover, would be = 30; and the total capital turned over = 30 × S/y; the total capital turned over in 10 years. But the fixed capital turns over only twice in 10 years. Its R′ = 2; and the total fixed capital turned over = 2S/x. But S = S/y + S/x and its total turnover time = the total turnover time of both these parts. If the fixed capital turns over twice in 10 years, then in one year 2/10 or 1/5 of it turns over; while in one year the circulating capital turns over 3 times. S/5x turns over once a year.

The question simply this: if a capital of 1,000 thalers = 600 circulating capital and 400 fixed capital; thus 3/5 circulating and 2/5 fixed capital; if the fixed capital lasts 5 years, hence turns over once in 5 years and the circulating turns over 3 times a year, then what is the average turnover or turnover time of the total capital? If it were circulating capital only, then it would turn over 5 × 3, 15 times; the total capital turned over in the 5 years would be 15,000. But 2/5 of it turn over only once in 5 years. Hence, of the 400 thalers, 400/5 = 80 thalers turn over in one year. Of the 1,000 thalers, 600 annually turn over 3 times, 80 once; or, in one year, only 1,880 would turn over; hence in 5 years 5 ×1,880 = 9,400 turn over; i.e. 5,600 less than if the total capital consisted only of circulating capital. If the entire capital consisted only of circulating capital, then it would turn over once in 1/3 of a year.

If the capital = 1,000; c = 600, turns over twice a year; f = 400, turns over once a year; then 600 (3/5 S) turns over in half a year; 400/2 or 2S/(5 × 2) likewise in half a year. Hence in half a year, 600 + 200 = 800 (i.e. c + f/2) turns over. IN A WHOLE YEAR, hence, 2 × 800 or 1,600 turn over; 1,600 thalers in 1 year; hence 100 in 12/16 months, hence 1,000 in 120/16 months = 7 1/2 months. The total capital of 1,000 thus turns over in 7 1/2 months, while it would turn over in 6 months if it consisted of circulating capital only. 7 1/2: 6 = 1:1 1/4 or as 1:5/4. If the capital = 100, circulating = 50, fixed = 50; the former turns over twice a year, the latter once; then 1/2 100 turns over once in 6 months; and 1/4 100 likewise once in 6 months; hence in 6 months 3/4 of the capital turns over, 3/4 100 in 6 months; or 75 in 6 months, and 100 in 8 months. If 2/4 100 turn over in 6 months, and in the same 6 months 1/4 100 (1/2 of the fixed capital), then 3/4 100 turn over in 6 months. Hence 1/4 in 6/3 = 2 [months]; hence 4/4 100 or 100 in 6 + 2, in 8 months. The total turnover time of the capital = 6 (the turnover time of the entire circulating capital and 1/2; of the fixed capital or 1/4 of the total capital) + 6/3 i.e. + this turnover time divided by the number expressing the ratio of the remaining fixed capital to the capital turned over in the turnover time of circulating capital. Thus in the above example: 3/5 100 turns over in 6 months; ditto 1/5 100; hence 4/5 100 in 6 months; hence the remaining 1/5 100 in 6/4 months; hence the total capital in 6 + 6/4 months = 6 + 1 1/2 or 7 1/2 months. Thus, expressed in general terms:

Average turnover time = the turnover time of circulating capital + this turnover time divided by the number which expresses how often the remaining part of the fixed capital is contained in the total sum of the capital which was circulated in this turnover time.

If there are two capitals of 100 thalers, one of them entirely composed of circulating capital, the other half fixed capital, each at 5% profit, the one turning over twice a year, and in the other the circulating capital likewise twice, but the fixed capital only once; then the total capital turning over would be = 200 in the first case, and the profit = 10; in the second = 3 turnovers in 8 months, 1 1/2 in 4; or 150 would turn over in 12 months; profit then = 7 1/2. This kind of calculation has strengthened the common prejudice that circulating capital or fixed capital through some mysterious innate power brings a gain, as even in Malthus’s phrase ‘the circulating capital brings a gain when its possessors part with it etc.’; [70] likewise, in the above-quoted lines from his Measure of Value etc., the way in which he makes fixed capital accumulate profits. [71] The greatest confusion and mystification has arisen because the doctrine of surplus profit has not been examined in its pure form by previous economists, but rather mixed in together with the doctrine of real profit, which leads up to distribution, where the various capitals participate in the general rate of profit. The profit of the capitalists as a class, or the profit of capital as such, has to exist before it can be distributed, and it is extremely absurd to try to explain its origin by its distribution. According to the above, profit declines because the turnover time of capital increases * in proportion as the component part of it which is called fixed capital increases. A capital of the same size, 100 in the above case, would turn over entirely twice a year if it consisted only of a circulating capital. But it turns over only twice in 16 months, or only 150 thalers are turned over in one year, because half of it consists of fixed capital. As the number of its reproductions in a given period declines, or the amount of it reproduced in this given time declines, so does the production of surplus time or surplus value decline, since capital posits value at all only in so far as it posits surplus value. (This at least is its tendency, its adequate action.)

* Its size posited as permanent – this does not concern us here at all, since the statement is true for a capital of any size. Capitals have different sizes. But the size of each individual capital is equal to itself, hence, in so far as only its quality as capital is concerned, any size. But if we examine two capitals in comparison to each other, then the difference in their size introduces a relation of a qualitative characters. Size becomes itself a distinguishing quality. This is an essential aspect, of which size is only one single instance, of how the study of capital as such differs from the study of one capital in relation to another capital, or the study of capital in its reality.

Fixed capital, as we saw, circulates as value only to the degree that it is used up or consumed as use value in the production process. But the time in which it is consumed and in which it must be reproduced in its form as use value depends on its relative durability. Hence its durability, or its greater or lesser perishability – the greater or smaller amount of time during which it can continue to perform its function within the repeated production processes of capital – this aspect of its use value here becomes a form-determining moment, i.e. a determinant for capital as regards its form, not as regards its matter. The necessary reproduction time of fixed capital, together with the proportion of the total capital consisting of it, here modify, therefore, the turnover time of the total capital, and thereby its realization. The greater durability of capital (the diminution (duration) of its necessary reproduction time) and the proportion of fixed capital to the total capital, then, here influence realization just as does a slower turnover due either to a greater distance in space of the market from which the capital returns as money, so that a longer time is required to complete the path of circulation (as e.g. capitals working in England for the East India market return more slowly than those working for nearer foreign markets or for the domestic market), or to the production phase being itself interrupted by natural conditions, as in agriculture. Ricardo, who was the first to emphasize the influence of fixed capital on the realization process, throws all these aspects into one motley heap, as one can see from the excerpts quoted above. [72]

In the first case (fixed capital), the turnover of capital is reduced because the fixed capital is consumed slowly within the production process; or the cause lies in the duration of the time required for its reproduction. In the second case the reduced turnover arises from the prolongation of circulation time (in the first case the fixed capital necessarily always circulates as rapidly as the product, in so far as it circulates, enters circulation at all, because it circulates not in its material existence, but only as value, i.e. as an ideal component part of the total value of the product) and, specifically, from the circulation time of the second half of the circulation process proper, the retransformation into money; in the third case the reduced turnover arises from the longer time the capital requires, not, as in the first case, to pass away in the production process, but rather to emerge from it as product. The first case is peculiar specifically to fixed capital; the other belongs to the category of capital which is not liquid, but fixated, fixated in one or another phase of the total circulation process (fixed capital of a considerable degree of durability, or circulating capital returnable at distant periods. McCulloch, Principles of Political Economy. Notebook, p. 15.) [73]

Thirdly: We have regarded fixed capital so far only from the aspect in which its particular relation, its specific relation, distinguishes it from the circulation process proper. Still further distinctions will arise in this respect. Firstly, the return of its value in successive parts, whereas each part of circulating capital is exchanged in its entirety; this because in the former, the existence of the value coincides with that of the use value. Secondly, not merely [because of] its influence on the average turnover time of a given capital, as we have indicated up to now, but also [because of] its own turnover time. The latter circumstance becomes important where the fixed capital appears not as a mere instrument of production within the production process, but rather as an independent form of capital, e.g. in the form of railways, canals, roads, aqueducts, improvements of the land, etc. This latter aspect becomes notably important for the proportion in which the total capital of a country is divided into these two forms. Then, the way in which it is renewed and maintained; which the economists formulate in the form that it can bring revenue only by means of circulating capital etc. This last is basically nothing but the examination of the moment where it appears, not as a particular independent existence alongside and outside circulating capital, but rather as circulating capital transformed into fixed capital. But what we want to examine here first of all is the relation of fixed capital not towards the outside, but rather the extent to which the relation is given through its continued enclosure within the production process. It is thereby posited that it is a definite moment of the production process itself.

<It is not necessarily the case that fixed capital is capital which in all its aspects serves not for individual consumption, but only for production. A house can serve for production as well as for consumption; likewise all vehicles, a ship and a wagon, for pleasure outings as well as a means of transport; a street as a means of communication for production proper, as well as for taking walks etc. Fixed capital in this second aspect does not concern us here at all, since we regard capital here only as process of realization and process of production. The second aspect will enter when we study interest. Ricardo can have only this aspect in mind when he says: ‘Depending on whether the capital is more or less perishable, hence must be more or less frequently reproduced in a given time, it is called circulating or fixed capital.’ (Ricardo, VIII, 19.) [74] According to this, a coffee-pot would be fixed capital, but coffee circulating capital. The crude materialism of the economists who regard as the natural properties of things what are social relations of production among people, and qualities which things obtain because they are subsumed under these relations, is at the same time just as crude an idealism, even fetishism, since it imputes social relations to things as inherent characteristics, and thus mystifies them. (The difficulty of defining a thing as fixed capital or circulating capital on the basis of its natural qualities has here, by way of exception, led the economists to the discovery that things in themselves are neither fixed nor circulating, hence not capital at all, any more than it is a natural quality of gold to be money.)>

(Also included in the points listed above, so that it is not forgotten, is the circulation of fixed capital as circulating capital, i.e. transactions through which it changes its owners.)

‘Fixed capital – tied up: capital so tied up in one kind of production that it can no longer be diverted to another kind of production.’ (Say, 24.) [75] ‘Fixed capital is consumed in order to help produce the things useful to man … it consists of durable foundations which increase the productive powers of future labour.’ (Sismondi, VI) [76] ‘Fixed capital the capital necessary to maintain the instruments, machines etc. of labour.’ (Smith, Vol. II, p. 226.) ‘Floating capital is consumed, fixed capital merely used in the great work of production.’ (Economist, Notebook VI, p. 1.) [77] ‘We shall show that the first stick or the first stone which he took in his hand to assist him in the pursuit of these objects, by accomplishing a part of his labour, performed precisely the function of the capitals presently employed by the commercial nations.’ (Lauderdale, p. 120. Notebook, 8a.) ‘It is one of the characteristic and distinguishing traits of the human species to replace labour in this way with a capital transformed into machines.’ (p. 120.) (p. 9, Notebook Lauderdale.) ‘It may now be seen that the profit of capitals always arises either because they replace a portion of the work which man must do by hand, or because they accomplish a portion of work which is beyond the personal effort of man, and which he could not perform by himself.’ (p. 119 loc. cit.) Lauderdale polemicizes against Smith and Locke, whose view that labour is the creator of profit, has the following result, according to him: ‘if this idea of capital’s benefits were rigorously correct, then it would follow that it would not be an original source of wealth, but rather a derived one; and one could not consider capital as one of the principles of wealth, its profit being nothing more than a transfer from the worker’s pocket to that of the capitalist.’ (loc. cit. 116, 117.) ‘The profit of capitals always arises either because they replace a portion of the work which man must do by hand, or because they accomplish a portion of work which is beyond the personal effort of man, and which he could not perform by himself.’ (p. 119, loc. cit., p. 9b.) ‘It is well to remark that while the capitalist, with the use he makes of his money, saves the class of consumers a certain amount of labour, he does not substitute for it an equal portion of his own; which proves that his capital performs it, and not he himself.’ (10, Notebook, loc. cit., p. 132.) ‘If Adam Smith, instead of imagining that the effect of a machine is to facilitate labour, or, as he expresses it, to increase the productive power of labour (it is only through a strange confusion of ideas that Mr Smith has been able to assert that the effect of capital is to increase the productive power of labour. With the same logic one could very well claim that to shorten by half a roundabout path between two points is to double the walker’s speed) had perceived that the money spent on machinery brings a profit by replacing labour, he would have attributed the origin of profit to the same circumstance.’ (p. 11, p. 137.) ‘Capitals in domestic commerce, whether fixed or circulating, far from serving to set labour in motion, far from increasing its productive power, are, on the contrary, useful and profitable only in two circumstances, either when they obviate the necessity of a portion of the work which man would otherwise have to do with his hands; or when they perform a particular piece of work which man does not have the power to do unaided.’ This, says Lauderdale, is not merely a semantic difference. ‘The idea that capital sets labour into action, and adds to its productive power, gives rise to the opinion that labour is everywhere proportional to the quantity of existing capitals; that a country’s industry is always in proportion to the funds employed: from which it would follow that the increase of capital is the sovereign and unlimited means of increasing wealth. Instead of that, if one admits that capital can have no profitable or useful employment other than to replace a certain work, or to perform it, then one will draw the natural conclusion that the State would gain no benefit whatever from the possession of more capitals than it can employ in doing the work or in substituting for it in the production and fabrication of the things the consumer demands.’ (p. 151, 152, pp. 11, 12.) To prove his view that capital is a source sui generis of profit and hence of wealth, independently of labour, he points to the surplus profits which the owner of a newly invented machine has before his patent runs out and competition presses down the prices, and concludes then with the words: ‘This change of rule for the price does not prevent the benefit’ (as regards use value) ‘of the machine from coming from a fund of the same nature as that from which it came before the expiration of the patent: this fund is always that part of a country’s revenues which was formerly destined to pay the wages of the labour which the new invention replaces.’ (loc. cit. 125, p. 10b.) By contrast, Ravenstone (IX, 32): ‘Machinery can seldom be applied with success to abridge the labours of an individual; more time would be lost in its construction than could be saved by its application. It is only really useful when it acts on great masses, when a single machine can assist the labours of thousands. It is accordingly in the most populous countries where there are most idle men that it is always most abundant. It is not called into action by a scarcity of men, but by the facility with which they are brought together.’ (loc. cit.) [78]

‘Division of machines into (1) machines employed to produce power; (2) machines whose purpose is simply to transmit power and to perform the work.’ (Babbage, Notebook, p. 10.) [79] ‘Factory signifies the cooperation of several classes of workers, adults and non-adults, watching attentively and assiduously over a system of productive mechanisms, continually kept in action by a central force … excludes any workshop whose mechanism does not form a continuous system, or which does not depend on a single source of power. Examples of this latter class among textile factories, copper foundries etc. … In its most rigorous sense, this term conveys the idea of a vast automaton, composed of numerous mechanical and intellectual organs operating in concert and without interruption, towards one and the same aim, all these organs being subordinated to a motive force which moves itself.’ (Ure, 13.) [80]

##### The labour process. – Fixed capital. Means of labour. Machine. – Fixed capital. Transposition of powers of labour into powers of capital both in fixed and in circulating capital. – To what extent fixed capital (machine) creates value. – Lauderdale. Machine presupposes a mass of workers.

Capital which consumes itself in the production process, or fixed capital, is the means of production in the strict sense. In a broader sense the entire production process and each of its moments, such as circulation – as regards its material side – is only a means of production for capital, for which value alone is the end in itself. Regarded as a physical substance, the raw material itself is a means of production for the product etc.

But the determination that the use value of fixed capital is that which eats itself up in the production process is identical to the proposition that it is used in this process only as a means, and itself exists merely as an agency for the transformation of the raw material into the product. As such a means of production, its use value can be that it is merely the technological condition for the occurrence of the process (the site where the production process proceeds), as with buildings etc., or that it is a direct condition of the action of the means of production proper, like all matières instrumentales. Both are in turn only the material presuppositions for the production process generally, or for the employment and maintenance of the means of labour. The latter, however, in the proper sense, serves only within production and for production, and has no other use value.

Originally, when we examined the development of value into capital, the labour process was simply included within capital, and, as regards its physical conditions, its material presence, capital appeared as the totality of the conditions of this process, and correspondingly sorted itself out into certain qualitatively different parts, material of labour (this, not raw material, is the correct expression of the concept), means of labour and living labour. On one side, capital was divided into these three elements in accordance with its material composition; on the other, the labour process (or the merging of these elements into each other within the process) was their moving unity, the product their static unity. In this form, the material elements – material of labour, means of labour and living labour – appeared merely as the essential moments of the labour process itself, which capital appropriates. But this material side – or, its character as use value and as real process – did not at all coincide with its formal side. In the latter,

(1) the three elements in which it appears before the exchange with labour capacity, before the real process, appeared merely as quantitatively different portions of itself, as quantities of value of which it, itself, as sum, forms the unity. The physical form, the use value, in which these different portions existed did not in any way alter their formal identity from this side. As far as their formal side was concerned, they appeared only as quantitative subdivisions of capital;

(2) within the process itself, as regards the form, the elements of labour and the two others were distinct only in so far as the latter were specified as constant values, and the former as value-positing. But as far as their distinctness as use values, their material side was concerned, this fell entirely outside the capital’s specific character as form. Now, however, with the distinction between circulating capital (raw material and product) and fixed capital (means of labour), the distinctness of the elements as use values is posited simultaneously as a distinction within capital as capital, on its formal side. The relation between the factors, which had been merely quantitative, now appears as a qualitative division within capital itself, and as a determinant of its total movement (turnover). Likewise, the material of labour and the product of labour, this neutral precipitate of the labour process, are already, as raw material and product, materially specified no longer as material and product of labour, but rather as the use value of capital itself in different phases.

As long as the means of labour remains a means of labour in the proper sense of the term, such as it is directly, historically, adopted by capital and included in its realization process, it undergoes a merely formal modification, by appearing now as a means of labour not only in regard to its material side, but also at the same time as a particular mode of the presence of capital, determined by its total process – as fixed capital. But, once adopted into the production process of capital, the means of labour passes through different metamorphoses, whose culmination is the machine, or rather, an automatic system of machinery (system of machinery: the automatic one is merely its most complete, most adequate form, and alone transforms machinery into a system), set in motion by an automaton, a moving power that moves itself; this automaton consisting of numerous mechanical and intellectual organs, so that the workers themselves are cast merely as its conscious linkages. In the machine, and even more in machinery as an automatic system, the use value, i.e. the material quality of the means of labour, is transformed into an existence adequate to fixed capital and to capital as such; and the form in which it was adopted into the production process of capital, the direct means of labour, is superseded by a form posited by capital itself and corresponding to it. In no way does the machine appear as the individual worker’s means of labour. Its distinguishing characteristic is not in the least, as with the means of labour, to transmit the worker’s activity to the object; this activity, rather, is posited in such a way that it merely transmits the machine’s work, the machine’s action, on to the raw material – supervises it and guards against interruptions. Not as with the instrument, which the worker animates and makes into his organ with his skill and strength, and whose handling therefore depends on his virtuosity. Rather, it is the machine which possesses skill and strength in place of the worker, is itself the virtuoso, with a soul of its own in the mechanical laws acting through it; and it consumes coal, oil etc. (matières instrumentales), just as the worker consumes food, to keep up its perpetual motion. The worker’s activity, reduced to a mere abstraction of activity, is determined and regulated on all sides by the movement of the machinery, and not the opposite. The science which compels the inanimate limbs of the machinery, by their construction, to act purposefully, as an automaton, does not exist in the worker’s consciousness, but rather acts upon him through the machine as an alien power, as the power of the machine itself. The appropriation of living labour by objectified labour – of the power or activity which creates value by value existing for-itself – which lies in the concept of capital, is posited, in production resting on machinery, as the character of the production process itself, including its material elements and its material motion. The production process has ceased to be a labour process in the sense of a process dominated by labour as its governing unity. Labour appears, rather, merely as a conscious organ, scattered among the individual living workers at numerous points of the mechanical system; subsumed under the total process of the machinery itself, as itself only a link of the system, whose unity exists not in the living workers, but rather in the living (active) machinery, which confronts his individual, insignificant doings as a mighty organism. In machinery, objectified labour confronts living labour within the labour process itself as the power which rules it; a power which, as the appropriation of living labour, is the form of capital. The transformation of the means of labour into machinery, and of living labour into a mere living accessory of this machinery, as the means of its action, also posits the absorption of the labour process in its material character as a mere moment of the realization process of capital. The increase of the productive force of labour and the greatest possible negation of necessary labour is the necessary tendency of capital, as we have seen. The transformation of the means of labour into machinery is the realization of this tendency. In machinery, objectified labour materially confronts living labour as a ruling power and as an active subsumption of the latter under itself, not only by appropriating it, but in the real production process itself; the relation of capital as value which appropriates value-creating activity is, in fixed capital existing as machinery, posited at the same time as the relation of the use value of capital to the use value of labour capacity; further, the value objectified in machinery appears as a presupposition against which the value-creating power of the individual labour capacity is an infinitesimal, vanishing magnitude; the production in enormous mass quantities which is posited with machinery destroys every connection of the product with the direct need of the producer, and hence with direct use value; it is already posited in the form of the product’s production and in the relations in which it is produced that it is produced only as a conveyor of value, and its use value only as condition to that end. In machinery, objectified labour itself appears not only in the form of product or of the product employed as means of labour, but in the form of the force of production itself. The development of the means of labour into machinery is not an accidental moment of capital, but is rather the historical reshaping of the traditional, inherited means of labour into a form adequate to capital. The accumulation of knowledge and of skill, of the general productive forces of the social brain, is thus absorbed into capital, as opposed to labour, and hence appears as an attribute of capital, and more specifically of fixed capital, in so far as it enters into the production process as a means of production proper. Machinery appears, then, as the most adequate form of fixed capital, and fixed capital, in so far as capital’s relations with itself are concerned, appears as the most adequate form of capital as such. In another respect, however, in so far as fixed capital is condemned to an existence within the confines of a specific use value, it does not correspond to the concept of capital, which, as value, is indifferent to every specific form of use value, and can adopt or shed any of them as equivalent incarnations. In this respect, as regards capital’s external relations, it is circulating capital which appears as the adequate form of capital, and not fixed capital.

Further, in so far as machinery develops with the accumulation of society’s science, of productive force generally, general social labour presents itself not in labour but in capital. The productive force of society is measured in fixed capital, exists there in its objective form; and, inversely, the productive force of capital grows with this general progress, which capital appropriates free of charge. This is not the place to go into the development of machinery in detail; rather only in its general aspect; in so far as the means of labour, as a physical thing, loses its direct form, becomes fixed capital, and confronts the worker physically as capital. In machinery, knowledge appears as alien, external to him; and living labour [as] subsumed under self-activating objectified labour. The worker appears as superfluous to the extent that his action is not determined by [capital’s] requirements.

# The Chapter on Capital (continuation)

The full development of capital, therefore, takes place – or capital has posited the mode of production corresponding to it – only when the means of labour has not only taken the economic form of fixed capital, but has also been suspended in its immediate form, and when fixed capital appears as a machine within the production process, opposite labour; and the entire production process appears as not subsumed under the direct skilfulness of the worker, but rather as the technological application of science. [It is,] hence, the tendency of capital to give production a scientific character; direct labour [is] reduced to a mere moment of this process. As with the transformation of value into capital, so does it appear in the further development of capital, that it presupposes a certain given historical development of the productive forces on one side – science too [is] among these productive forces – and, on the other, drives and forces them further onwards.

Thus the quantitative extent and the effectiveness (intensity) to which capital is developed as fixed capital indicate the general degree to which capital is developed as capital, as power over living labour, and to which it has conquered the production process as such. Also, in the sense that it expresses the accumulation of objectified productive forces, and likewise of objectified labour. However, while capital gives itself its adequate form as use value within the production process only in the form of machinery and other material manifestations of fixed capital, such as railways etc. (to which we shall return later), this in no way means that this use value – machinery as such – is capital, or that its existence as machinery is identical with its existence as capital; any more than gold would cease to have use value as gold if it were no longer money. Machinery does not lose its use value as soon as it ceases to be capital. While machinery is the most appropriate form of the use value of fixed capital, it does not at all follow that therefore subsumption under the social relation of capital is the most appropriate and ultimate social relation of production for the application of machinery.

To the degree that labour time – the mere quantity of labour – is posited by capital as the sole determinant element, to that degree does direct labour and its quantity disappear as the determinant principle of production – of the creation of use values – and is reduced both quantitatively, to a smaller proportion, and qualitatively, as an, of course, indispensable but subordinate moment, compared to general scientific labour, technological application of natural sciences, on one side, and to the general productive force arising from social combination [Gliederung] in total production on the other side – a combination which appears as a natural fruit of social labour (although it is a historic product). Capital thus works towards its own dissolution as the form dominating production.

While, then, in one respect the transformation of the production process from the simple labour process into a scientific process, which subjugates the forces of nature and compels them to work in the service of human needs, appears as a quality of fixed capital in contrast to living labour; while individual labour as such has ceased altogether to appear as productive, is productive, rather, only in these common labours which subordinate the forces of nature to themselves, and while this elevation of direct labour into social labour appears as a reduction of individual labour to the level of helplessness in face of the communality [Gemeinsamkeit] represented by and concentrated in capital; so does it now appear, in another respect, as a quality of circulating capital, to maintain labour in one branch of production by means of co-existing labour in another. In small-scale circulation, capital advances the worker the wages which the latter exchanges for products necessary for his consumption. The money he obtains has this power only because others are working alongside him at the same time; and capital can give him claims on alien labour, in the form of money, only because it has appropriated his own labour. This exchange of one’s own labour with alien labour appears here not as mediated and determined by the simultaneous existence of the labour of others, but rather by the advance which capital makes. The worker’s ability to engage in the exchange of substances necessary for his consumption during production appears as due to an attribute of the part of circulating capital which is paid to the worker, and of circulating capital generally. It appears not as an exchange of substances between the simultaneous labour powers, but as the metabolism [Stoffwechsel] of capital; as the existence of circulating capital. Thus all powers of labour are transposed into powers of capital; the productive power of labour into fixed capital (posited as external to labour and as existing independently of it (as object [sachlich]); and, in circulating capital, the fact that the worker himself has created the conditions for the repetition of his labour, and that the exchange of this, his labour, is mediated by the co-existing labour of others, appears in such a way that capital gives him an advance and posits the simultaneity of the branches of labour. (These last two aspects actually belong to accumulation.) Capital in the form of circulating capital posits itself as mediator between the different workers.

Fixed capital, in its character as means of production, whose most adequate form [is] machinery, produces value, i.e. increases the value of the product, in only two respects: (1) in so far as it has value; i.e. is itself the product of labour, a certain quantity of labour in objectified form; (2) in so far as it increases the relation of surplus labour to necessary labour, by enabling labour, through an increase of its productive power, to create a greater mass of the products required for the maintenance of living labour capacity in a shorter time. It is therefore a highly absurd bourgeois assertion that the worker shares with the capitalist, because the latter, with fixed capital (which is, as far as that goes, itself a product of labour, and of alien labour merely appropriated by capital) makes labour easier for him (rather, he robs it of all independence and attractive character, by means of the machine), or makes his labour shorter. Capital employs machinery, rather, only to the extent that it enables the worker to work a larger part of his time for capital, to relate to a larger part of his time as time which does not belong to him, to work longer for another. Through this process, the amount of labour necessary for the production of a given object is indeed reduced to a minimum, but only in order to realize a maximum of labour in the maximum number of such objects. The first aspect is important, because capital here – quite unintentionally – reduces human labour, expenditure of energy, to a minimum. This will redound to the benefit of emancipated labour, and is the condition of its emancipation. From what has been said, it is clear how absurd Lauderdale is when he wants to make fixed capital into an independent source of value, independent of labour time. It is such a source only in so far as it is itself objectified labour time, and in so far as it posits surplus labour time. The employment of machinery itself historically presupposes – see above, Ravenstone – superfluous hands. Machinery inserts itself to replace labour only where there is an overflow of labour powers. Only in the imagination of economists does it leap to the aid of the individual worker. It can be effective only with masses of workers, whose concentration relative to capital is one of its historic presuppositions, as we have seen. It enters not in order to replace labour power where this is lacking, but rather in order to reduce massively available labour power to its necessary measure. Machinery enters only where labour capacity is on hand in masses. (Return to this.)

Lauderdale believes himself to have made the great discovery that machinery does not increase the productive power of labour, because it rather replaces the latter, or does what labour cannot do with its own power. It belongs to the concept of capital that the increased productive force of labour is posited rather as the increase of a force [Kraft] outside itself, and as labour’s own debilitation [Entkräftung]. The hand tool makes the worker independent – posits him as proprietor. Machinery – as fixed capital – posits him as dependent, posits him as appropriated. This effect of machinery holds only in so far as it is cast into the role of fixed capital, and this it is only because the worker relates to it as wage-worker, and the active individual generally, as mere worker.