Chapter Two of Capital, entitled “The Process of Exchange,” seems uncharacteristically short. Marx’s investigation here starts with the assertion that “Commodities cannot themselves go to market…” (p. 178) Indeed, a commodity that could do such a thing would most definitely be rather magical!
Rather than waltz by themselves to the market, commodities, of course, have owners. Generally speaking, that could mean you and me, folks! These owners recognize each other as owners of private property. It is no secret that capitalists are pretty big on the concept of private property; indeed, as Marx notes, relations between owners of private property are “juridical” – and they’re often codified in law as contracts.
When the owners, then, go to the market, they exchange their commodities with each other. Marx notes that in this system, all commodities are non use-values for their owners but “use-values for their non owners.” This is not as convoluted as it may sound. Obviously, if I were to embark on a long trek to the market to sell a pot of honey but then stopped and, like Winnie-the-Pooh, turned that honey into a use-value for myself by devouring it all greedily, I would no longer have a commodity left.
It takes a certain discipline to be a capitalist, no?
So if my pot of honey is to operate as a commodity on the market, it must be a non use-value to me, but a use-value to someone else.
In return for my pot of honey, I will obtain a commodity that is a use-value for me. Maybe a nice bottle of wine! In this part of the process of the exchange, we return to the idea of the universal equivalent that was broached in Chapter 1, whereby, within a simple system of exchange, I consider my pot of honey to be the universal equivalent of whatever I might want on the market. In other words, my pot of honey contains in it, in whole or in part, the equivalent value to any other commodity. But as has been established, the socially-accepted universal equivalent in the market is not usually a pot of honey or a bottle of wine or what have you: generally, it’s a precious metal like gold or silver. It’s money.
Marx notes that, at first, through the system of exchange, the value of commodities gets affixed by “chance.” It is merely the encounter between two owners of commodities that determines that a pot of honey might equal, say, one bottle of wine. In some other context, this exchange might seem a rotten deal. But “the constant repetition of exchange makes it a normal social process” (p182). And so, after many thousands of transactions, it becomes not mere chance but rather a socially accepted norm that 1 pot of honey = 1 bottle of wine. Or rather, because we’re operating in a money economy, 1 pot of honey in a simple market = $10, and a bottle of wine is also $10.
In the process of exchange, all commodities have a relationship to money, which is the universal equivalent, or the universal commodity. This means we get away from the idea that 1 pot of honey = 1 bottle of wine. These two commodities, like all commodities, now relate to money, enabling far more complex transactions. Now I can sell 10 pots of honey for $10 each and go home from the market without buying anything if I so choose. I can now horde my money until such a time as there is a glut of wine on the market and then return, like a conquering king, and buy up hundreds of bottles of wine and get leglessly drunk every day for a week. Hollah! (This scenario is taken from my imagination, not from Capital.)
OK, a few final observations in Chapter 2 before Marx moves on quickly on his swift Marxist legs. Or rather with his nimble Marxist fingers. He writes how money is like any other commodity in that it cannot express value in relation to itself; it can only express value in relation to other commodities. So $10 is pretty much valueless unless I exchange it for something other than $10; to realize its value, I need to exchange it for something. Like a kitten or an antique ashtray.
Marx then asks, how does a commodity become money? What alchemy is at work here? Well, as it so happens, there really is no alchemy: “…all other commodities universally express their values in a particular commodity because it is money. The movement through which this process has been mediated vanishes in its own result, leaving no trace behind” (p187).
In other words, commodities don’t become money, they express their value as money because money is what it is: the socially-accepted universal equivalent.
And let’s not forget that money, as a commodity like any other, is the incarnation of human labour. So within a capitalist mode of production, gold and silver, ripped out of the earth, embody human labour immediately upon their emergence into the system of exchange. Marx concludes that the “money fetish” and the “commodity fetish” are one and the same. In this system, for the hapless workers, “Their own relations of production therefore assume a material shape which is independent of their control and their conscious individual action” (p187).
David Harvey, whose lectures are enormously illuminating Capital for me (and thousands more besides), lingers on this point a lot longer than Marx does here in Chapter 2. Harvey says that Marx is agreeing with Adam Smith that capitalism is a system that is not the result of an individual or group. Rather, it is a system that operates according to its own logic, over which individuals or groups are powerless. Smith’s famous “hidden hand of the market” does indeed regulate behaviors and creates values; Marx would nod his bearded head and agree 100%. In so doing, the hidden hand of the market creates a social order. However, Marx parts ways with Ricardo and Smith; unlike them, he does not believe that the social order will be just and that it will benefit everyone. He believes it will benefit the bourgeoisie, that is, the owners of the means of production.
I’ve got a feeling we’re going to hear a little more about these injustices!